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- **Revenue & Margin Growth**: Q3 revenue up 5% to $167 million, adjusted EBITDA margin expands to 13% (100 bps Q/Q).
- **Segment Standout**: Northeast Mid-Con segment revenue surges 29%, driven by completions activity and reduced white space.
- **Cost Efficiency**: SG&A expenses down 30% YoY, with 2025 guidance for 9-10% of revenue.
- **Natural Gas Growth**: Dry gas revenue up 15% Q/Q, aligning with Haynesville rig count rebound and LNG export expansion.
- **Q4 Outlook**: Mid-single-digit revenue decline, but stable margins supported by cost controls and fleet turnover.
- **Balance Sheet Health**: $65 million liquidity, with Q4 free cash flow expected to improve due to working capital unwind.

**【CEO Summary Section】**
- **Q3 Revenue Growth**: $167 million (5% sequential increase), driven by a 29% surge in Northeast Mid-Con segment revenue.
- **Adjusted EBITDA**: $21 million (14% sequential increase), with margin expanding 100 basis points to 13%.
- **Segment Performance**: 
  - **Northeast Mid-Con**: Outperformed with 29% revenue growth, benefiting from reduced white space and completions activity.
  - **Southwest**: Revenue declined 4% (vs. 9% rig count drop), outperforming industry trends.
  - **Rockies**: Revenue down 6%, impacted by delayed completions and refrac activity decline.
- **Operational Efficiency**: Q3 revenue and EBITDA per rig ($318k, $40k) were 20% and 227% higher than Q4 2021 levels, reflecting cost optimization.
- **2026 Outlook**: Anticipates stable demand, margin resilience, and benefits from natural gas demand growth (e.g., LNG exports).

**【CFO Financial Commentary】**
- **Cost Control**: Adjusted SG&A expenses reduced 30% year-over-year to $14.8 million, with 2025 guidance of 9-10% of revenue.
- **Balance Sheet**: 
  - Total debt: $259.2 million (unchanged Q/Q), with $65 million liquidity ($8.3 million cash, $56.9 million ABL availability).
  - Q3 interest PIK: $6 million, with 100% cash payment in Q3.
- **Cash Flow**: Q3 free cash flow: $11 million, with Q4 expected to improve due to working capital unwind.
- **Capital Efficiency**: Q3 CapEx: $12 million (6% sequential decline), with 2025 net CapEx guidance of $30-35 million.

**【Q&A Highlights】**
- **Northeast Mid-Con Strength**: 15% Q/Q dry gas revenue growth, driven by Haynesville activity rebound (6 rigs added) and market share gains.
- **Rockies Challenges**: Margin pressure from episodic completions delays, highlighting negative operating leverage.
- **Q4 Guidance**: Mid-single-digit revenue decline (less severe than 2024's 13% drop), with stable margins supported by cost controls and fleet turnover.
- **2026 Outlook**: Optimism around natural gas demand (11 Bcf/d new LNG capacity) and consolidation-driven opportunities, with recent RFQ wins.
- **Balance Sheet Flexibility**: Liquidity maintained at $65 million, with Q4 asset sales and prudent PIK decisions to manage leverage.

KLX Energy Services Holdings, Inc. (KLXE) Q3 2025 Earnings Call Transcript

- **Q2 Strong Performance**: Revenue $159M (+3% QoQ), EBITDA $19M (+34% QoQ), margin 12% (up 260bps). Rockies and Northeast/Mid-Con segments led growth.
- **Gas Basin Momentum**: Dry gas revenue +25% QoQ, 40% below 2023 highs, positioning for LNG export growth.
- **Cost Efficiency**: SG&A reduced 12% YoY, free cash flow $12M in Q2, liquidity improving.
- **Strategic Growth**: Q3 targeting low-mid single-digit revenue growth, M&A pipeline active amid sector consolidation.
- **Balance Sheet Strength**: Debt reduced 1% QoQ, $65M liquidity, disciplined CapEx ($40-50M gross for 2025).

**【CEO Summary Section】**
- **Q2 Revenue and EBITDA Growth**: Reported $159 million revenue (+3% QoQ), adjusted EBITDA of $19 million (+34% QoQ). Rockies and Northeast/Mid-Con segments drove growth, offsetting Southwest decline.
- **Margin Improvement**: EBITDA margin rose 260bps to 12%, driven by cost control and utilization of completion services (e.g., coiled tubing, tech services).
- **Geographic Performance**: Rockies revenue up 13% QoQ, Northeast/Mid-Con EBITDA doubled. Southwest faced white space due to customer completion holidays.
- **Outlook**: Q3 targeting low-mid single-digit revenue growth, supported by restarted completions programs and seasonal activity. Long-term focus on gas basins (Haynesville, Marcellus) with 25% QoQ revenue increase in dry gas.
- **M&A Strategy**: Actively pursuing consolidation opportunities, with renewed engagement from targets amid sector challenges.

**【CFO Financial Commentary】**
- **Financial Highlights**: GAAP net loss of $16.7 million, but adjusted EBITDA of $18.5 million. SG&A expenses reduced 12% YoY to $15.1 million (9-10% of revenue guidance for 2025).
- **Segment Results**: Rockies EBITDA +55% QoQ, Northeast/Mid-Con EBITDA +167% QoQ. Southwest EBITDA down 38% due to Permian rig count decline.
- **Balance Sheet**: $16.7 million cash, $65 million liquidity, $259 million debt (-1% QoQ). Q2 free cash flow of $12 million, with Q3 liquidity expected to improve.
- **CapEx Management**: 2025 gross CapEx $40-50 million, net $30-40 million, focused on fleet maintenance.

**【Q&A Key Highlights】**
- **Revenue Guidance**: Q3 low-mid single-digit growth despite rig count decline, supported by restarted completions and seasonal activity.
- **Gas Basin Opportunities**: Haynesville rig count up 12, Northeast stability. Q2 dry gas revenue +25% vs. Q1 2023 high by 40%.
- **Cash Flow and M&A**: Q2 free cash flow $12 million, Q3 liquidity improvement expected. M&A targets showing capitulation amid operational challenges.
- **Seasonal Impact**: Q4 gas activity not expected to be less severe; Haynesville completions steady, Marcellus/Utica stable.


KLX Energy Services (KLXE)-7 Aug 25-2025 Q2 Earnings call transcript

- **Southwest Dominance**: Southwest segment revenue up 6% QoQ, accounting for 42% of total Q1 revenue, with highest EBITDA since Q3 2023.
- **Margin Expansion**: Adjusted EBITDA margin improved 208 bps YoY to 9%, despite 12% revenue decline, driven by cost control.
- **Gas Play Focus**: 12.5% of revenue from dry gas, with expanding market share in tech services (e.g., Oracle SRT Gen 2 with 0.5M running feet).
- **Financial Flexibility**: New debt structure allows $2.5M/month PIK interest savings; 2025 CapEx reduced to $40-50M.
- **Q2 Outlook**: Revenue growth low-mid single digits, with Rockies recovery and Mid-Con frac fleets resuming activity.


**【CEO Summary Section】**
- Q1 2025 revenue was $154 million, down 12% YoY but up 6% sequentially in the Southwest segment, driven by higher-margin product service lines.
- Adjusted EBITDA margin improved 208 bps YoY to 9%, despite a 12% revenue decline, reflecting strong cost control.
- Southwest segment revenue reached $65.2 million, highest since Q3 2023, with 42% of total Q1 revenue.
- Rockies segment revenue declined 11% sequentially but was 5% higher YoY, with expected Q2 recovery.
- Company pivoting to natural gas-focused basins, with 12.5% of revenue from dry gas plays, and expanding market share in rentals and tech services.
- New debt structure allows PIK interest payments, saving $2.5 million/month, and flexibility for strategic opportunities.

**【CFO Financial Commentary】**
- Q1 2025 GAAP net loss was $12.4 million, but adjusted EBITDA was $13.8 million, up 24% YoY.
- SG&A expenses reduced 12% YoY to $16.5 million (excluding non-recurring items), with G&A headcount down 3%.
- Liquidity ended Q1 at $58.1 million, with $14.6 million cash and $43.5 million revolver availability.
- 2025 CapEx reduced to $40-50 million (gross), focused on high-margin service lines like rentals and fishing.
- Refinancing costs totaled $33 million, including $10 million in fees and $23 million in debt reduction.

**【Q&A Key Highlights】**
- **Q2 Outlook**: Revenue expected to increase low-mid single digits, driven by Southwest strength and Rockies seasonality recovery.
- **Tariff Impact**: 100% U.S.-manufactured products (e.g., plugs, ERT) mitigate supply chain risks; passing costs where possible.
- **M&A Strategy**: Actively evaluating deals with enhanced debt flexibility; focus on accretive, deleveraging transactions.
- **Gas vs. Oil Split**: 29% of Q1 revenue from production/intervention services, with optimism on LNG exports boosting gas-directed activity.
- **Liquidity Management**: Used PIK interest in Q1 to preserve cash; ATM program reactivated for potential buybacks.


KLX Energy Services (KLXE)-9 May 25-2025 Q1 Earnings call transcript

- **2024 Performance**: $709M revenue, $90M EBITDA (13% margin) despite 15% YoY revenue decline. 
- **2025 Outlook**: Flat to up revenue, 13%-15% EBITDA margin target. 
- **Key Drivers**: 
  - 50%+ revenue from post-frac services (rentals, coiled tubing). 
  - SG&A down 8% YoY to $79.6M. 
  - $232M refinanced notes reduce interest expense. 
- **Gas Basins Growth**: LNG export capacity doubling by 2030 could drive Haynesville rig count from 65 (Q4 2024) to 119 (Q1 2023 levels). 
- **M&A Focus**: High-spec equipment acquisitions with 75%+ free cash flow to debt repayment.

**【CEO Opening Remarks】**
- Q4 2024 revenue: $166 million (down 15% YoY), with adjusted EBITDA margin of 13.7% (up from 11.8% YoY). 
- Full year 2024 revenue: $709 million, adjusted EBITDA: $90 million (13% margin). 
- 2025 outlook: Flat to slightly up revenue, with adjusted EBITDA margin target of 13%-15%. 
- Key drivers: Cost-cutting (SG&A down 8% YoY), mix shift to higher-margin PSLs (post-frac services), and refinanced debt reducing interest expense. 
- LNG export growth expected to boost gas-directed activity in Haynesville, Marcellus/Utica basins. 

**【CFO Financial Details】**
- Q4 2024: 
  - Rockies segment: $54M revenue, 11.8% EBITDA margin. 
  - Southwest: $61.4M revenue, 9.6% EBITDA margin. 
  - Northeast/Mid-Con: $50.1M revenue, 9.8% EBITDA margin. 
- Full year 2024: 
  - SG&A expenses: $79.6M (down 8% YoY). 
  - CapEx: $51M (net $48M after asset sales). 
  - Cash flow: $112M liquidity (including $92M cash). 
- Refinancing: 
  - $232M notes due 2030, $160M ABL due 2028. 
  - Interest rate flexibility and $0.75/$1 excess cash flow to debt repayment. 

**【Q&A Highlights】**
1. **Margin Improvement Drivers**: 
   - 50%+ revenue from post-frac services sustained activity late in Q4. 
   - EBITDA per rig up 100% YoY (from $20k to $40k) due to cost cuts and mix shift. 
2. **2025 Cash Flow Expectations**: 
   - CapEx: $45-55M (down from $51M in 2024). 
   - Free cash flow likely used for debt repayment (75% of excess). 
3. **Haynesville Outlook**: 
   - 2023 Q1 peak revenue in gas basins: $150M/annualized vs. Q4 2024: $80M/annualized. 
   - LNG export capacity doubling by 2030 could drive rig count growth. 
4. **M&A Strategy**: 
   - Focus on accretive, deleveraging deals in existing PSLs (e.g., high-spec equipment). 
   - New debt docs allow $232M pari passu debt for acquisitions. 

**【2025 Key Themes】**
- Gas-directed activity growth in Haynesville, Northeast. 
- Cost structure locked in for 2025 (SG&A ~$70M). 
- Capital allocation: 70% maintenance, 30% growth in high-margin PSLs. 
- LNG export-driven demand for frac services in 2025+.

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