Mammoth Energy Services found the third quarter to be challenging as it reported a drop in total revenue compared to a year earlier and to this year’s previous quarter.
The Oklahoma City company released financial and operational results showing third quarter total revenue was $65 million, down from the $75.4 million reported in the second quarter and below the $107.2 million recorded a year ago.
However, the company’s net loss was also down. Net loss for the third quarter of 2023 was $1.1 million, or $0.02 loss per diluted share, compared to net income of $7.7 million, or $0.16 per diluted share, for the same quarter last year and net loss of $4.5 million, or $0.09 loss per diluted share, for the second quarter of 2023.
Adjusted EBITDA also fell. It was $13.4 million for the third quarter of 2023, compared to $29.8 million for the same quarter last year and $16.4 million for the second quarter of 2023.
“We are pleased to have announced that we entered into a new revolving credit facility agreement and a new term loan agreement, which refinanced, in full, Mammoth’s indebtedness outstanding under our previous revolving credit facility,”stated Arty Straehla, Chief Executive Officer of Mammoth in releasing the financial report.
“We believe these new agreements will provide Mammoth with a strong base of liquidity for years to come.”
He went on to explain the third quarter results were challenged by the persistence of demand and activity pressures which negatively impacted Mammoth’s pressure pumping fleet utilization, something that affected the firm’s overall performance.
“These market pressures that began earlier this year are largely attributable to commodity price fluctuations and delayed customer schedules. In response, we continue to closely manage our costs. Despite the softness we’ve experienced this year, we are now seeing encouraging signs of increasing activity and customer planning for 2024. We are also pleased with the improving line of sight for the next few quarters, and we expect an improvement in frac fleet counts in 2024.”
Mammoth had been in a legal battle to get paid for millions of dollars in power restoration work following the 2017 Hurricane Maria that devastated Puerto Rico. It reached a settlement earlier in the year and Straehla reported a payment of $11.4 million was received from PREPA, the Puerto Rico Electric Power Authority.
Mammoth’s well completion services division contributed revenue (inclusive of inter-segment revenue) of $20.3 million on 577 stages for the third quarter of 2023, compared to $51.5 million on 1,897 stages for the same quarter of 2022 and $27.6 million on 956 stages for the second quarter of 2023. On average, 1.2 of the Company’s fleets were active for the third quarter of 2023 compared to an average utilization of 3.5 fleets during the same quarter of 2022 and 1.6 fleets during the second quarter of 2023.
Mammoth’s infrastructure services division contributed revenue of $26.7 million for the third quarter of 2023 compared to $33.3 million for the same quarter of 2022 and $28.3 million for the second quarter of 2023. Average crew count was 81 crews during the third quarter of 2023 compared to 96 crews during the same quarter of 2022 and 86 crews during the second quarter of 2023.
Mammoth’s natural sand proppant services division contributed revenue (inclusive of inter-segment revenue) of $10.6 million for the third quarter of 2023 compared to $12.9 million for the same quarter of 2022 and $11.6 million for the second quarter of 2023. In the third quarter of 2023, the Company sold approximately 352,000 tons of sand at an average sales price of $30.18 per ton compared to sales of approximately 341,000 tons of sand at an average sales price of $29.95 per ton during the same quarter of 2022. In the second quarter of 2023, sales were approximately 384,000 tons of sand at an average price of $30.08 per ton.
Mammoth’s drilling services division contributed revenue (inclusive of inter-segment revenue) of $2.8 million for the third quarter of 2023 compared to $3.1 million for the same quarter of 2022 and $3.3 million for the second quarter of 2023. The decrease in drilling services revenue is primarily attributable to decreased utilization for our directional drilling business.