NexTier Oilfield Solutions (NEX) Tops Q2 EPS by 16c

NexTier Oilfield Solutions (NYSE: NEX) reported Q2 EPS of ($0.37), $0.16 better than the analyst estimate of ($0.53). Revenue for the quarter came in at $196.2 million versus the consensus estimate of $195.57 million.

Second Quarter 2020 Results and Recent Highlights

• Reported revenue of $196.2 million in the second quarter of 2020, compared to $627.6 million in the first quarter of 2020
• Reported net loss of $112.5 million in the second quarter of 2020, compared to net loss of $71.8 million in the first quarter of 2020
• Reported SG&A of $38.0 million in the second quarter of 2020, compared to $56.9 million in the first quarter of 2020. Reported adjusted SG&A(1) of $31.0 million in the second quarter of 2020, reflecting a decrease of 35% compared to $47.9 million in the first quarter of 2020
• Adjusted EBITDA(1) of $1.7 million in the second quarter of 2020, compared to $72.0 million in the first quarter of 2020
• Averaged 11 fully-utilized fracturing fleets in the second quarter of 2020 compared to 27 average fully-utilized fracturing fleets in the first quarter of 2020; deployed a second completion fleet internationally
• Reported revenue of $169.5 million in the second quarter of 2020 when considering only fracturing and bundled wireline, compared to $460.4 million in the first quarter of 2020
• Generated annualized adjusted gross profit per fully-utilized fracturing fleet(1) of $11.4 million in the second quarter of 2020, compared to $13.4 million in the first quarter of 2020
• Advanced digital initiative program, including the successful deployment of NexHub on all deployed U.S. fleets
• Exited the second quarter of 2020 with total liquidity of $430.5 million, including cash of $337.1 million and no term loan maturities through 2025

Management Commentary

"NexTier's second quarter performance in an extremely challenging market demonstrates we can consistently deliver on our commitments through solid execution," said Robert Drummond, President and Chief Executive Officer of NexTier. "During the quarter, U.S. producers abruptly halted much of their activity and production in response to economic shutdowns resulting from COVID-19. Our quick and decisive actions around cost control, continued focus on service quality, and the enhanced strength of our overall platform through the deployment of NexHub, our integrated digital technologies including remote monitoring capabilities, are evident in our financial performance. As we continue to navigate the current market environment, our proactive actions to improve service delivery, increase efficiency and reduce costs further differentiate NexTier and enhance its ability to compete in any environment."

"We delivered adjusted EBITDA decrementals that were meaningfully ahead of our guidance, completion fleet market share at the high-end of our forecast, and increased our cash balance by $23 million," said Kenny Pucheu, Executive Vice President and Chief Financial Officer. "As the market rapidly changed, we reacted quickly to restructure our organization to be even more lean and nimble, enhancing NexTier's ability to generate free cash flow and leading returns as the market eventually recovers. Our results and financial health demonstrate that NexTier is a business partner our customers can rely on over the long haul."

"While future activity remains highly uncertain, we are managing what is within our control, while maintaining an intense focus on NexTier's market readiness," continued Mr. Drummond. "Our ability to respond quickly and efficiently in a recovery is led by the capabilities of our world-class team, flexibility of our balance sheet, readiness of our asset base, and the further evolution of our innovation program. With the hard work and commitment of our entire team, we are further evolving NexTier's position as a leading completions platform."

For earnings history and earnings-related data on NexTier Oilfield Solutions (NEX) click here.

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