Flotek Industries Inc (FTK) 2023 Q2 法說會逐字稿

Greetings, and welcome to the Flotek Industries Second Quarter 2023 Earnings Conference Call. (Operator Instructions) As a result, this conference is being recorded. It is now my pleasure to turn the call over to Larry Busnardo, Investor Relations Representative for Flotek. Thank you. You may begin.

您好，歡迎參加 Flotek Industries 2023 年第二季度收益電話會議。 （操作員指示）因此，本次會議正在錄製中。現在我很高興將電話轉給 Flotek 投資者關係代表 Larry Busnardo。謝謝。你可以開始了。

Thank you, Dave, and good morning. We appreciate your participation in Flotek's Second Quarter 2023 Earnings Conference Call. Joining me on the call today are Ryan Ezell, Chief Executive Officer; and Bond Clement, Chief Financial Officer.

謝謝你，戴夫，早上好。我們感謝您參加 Flotek 2023 年第二季度收益電話會議。今天和我一起參加電話會議的是首席執行官瑞安·埃澤爾 (Ryan Ezell)；和首席財務官邦德·克萊門特。

On today's call, we will first provide prepared remarks concerning our business and results for the quarter. Following that, we will open up the call for any questions you have. We issued our earnings announcement for the second quarter of 2023 yesterday afternoon, which is available on the Investor Relations section of Flotek's website. We've also posted an updated and enhanced corporate presentation that we will be referencing on today's call. We encourage you to take the time to review it.

在今天的電話會議上，我們將首先提供有關本季度業務和業績的準備好的評論。之後，我們將打開電話詢問您的任何問題。昨天下午，我們發布了 2023 年第二季度的收益公告，您可以在 Flotek 網站的投資者關係部分查看該公告。我們還發布了更新和增強的公司演示文稿，我們將在今天的電話會議上參考該演示文稿。我們鼓勵您花時間查看它。

In addition, today's call is being webcast, and a replay will be available on our website shortly following the conclusion of this call. Please note that the comments we make on today's call regarding projections or our expectations for future events are forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control.

此外，今天的電話會議正在進行網絡直播，電話會議結束後不久將在我們的網站上提供重播。請注意，我們在今天的電話會議上發表的有關預測或對未來事件的期望的評論均為前瞻性陳述。前瞻性陳述受到許多風險和不確定性的影響，其中許多風險和不確定性超出了我們的控制範圍。

These risks and uncertainties can cause actual results to differ materially from our current expectations. We advise listeners to review our earnings release and the risk factors discussed in our filings with the SEC. In addition, please refer to the reconciliations provided in our earnings release as management may discuss non-GAAP financial metrics on this call.

這些風險和不確定性可能導致實際結果與我們當前的預期存在重大差異。我們建議聽眾查看我們的財報以及我們向美國證券交易委員會提交的文件中討論的風險因素。此外，請參閱我們的收益發布中提供的調節表，因為管理層可能會在本次電話會議上討論非 GAAP 財務指標。

With that, I will turn the call over to Ryan Ezell, Chief Executive Officer. Ryan?

接下來，我會將電話轉給首席執行官瑞安·埃澤爾 (Ryan Ezell)。瑞安？

Thank you, Larry, and good morning. We appreciate everyone's interest in Flotek and for joining us today as we discuss our second quarter 2023 operational and financial results. As most of you know, this is my first earnings call as CEO of Flotek, and I'm honored to be in this role as such a transformational time in the organization. I'd like to take a moment to thank Harsha Agadi for his tenure as interim CEO and congratulate him on his return to Flotek's Board of Directors as Chairman.

謝謝你，拉里，早上好。我們感謝大家對 Flotek 的興趣，並感謝大家今天加入我們討論 2023 年第二季度的運營和財務業績。正如你們大多數人所知，這是我作為 Flotek 首席執行官的第一次財報電話會議，我很榮幸能夠在組織轉型的時刻擔任這一職務。我想花點時間感謝 Harsha Agadi 擔任臨時首席執行官，並祝賀他重返 Flotek 董事會並擔任董事長。

Now turning to the quarter. Our second quarter performance demonstrates the meaningful progress we've made in improving Flotek's business fundamentals as we execute our corporate strategy. This, in turn, has resulted in a significant increase in the profitability of Flotek's complementary and unique business segments. Furthermore, I expect the organization to continue its trajectory of improving results for the remainder of the year.

現在轉向季度。我們第二季度的業績證明了我們在執行公司戰略時在改善 Flotek 業務基礎方面取得的有意義的進展。這反過來又導致 Flotek 互補且獨特的業務部門的盈利能力顯著增加。此外，我預計該組織將在今年剩餘時間內繼續改善業績。

And let's make no mistake. Our efforts are laser-focused on revenue growth, market share expansion and cost efficiency gains via our differentiated technologies in both chemistry and Data Analytics solution platforms. Both carry an undeniable value proposition that maximize our customers' value chain while generating a meaningful return on investment for our shareholders.

我們不要犯錯誤。我們的工作重點是通過我們在化學和數據分析解決方案平台上的差異化技術來實現收入增長、市場份額擴大和成本效率提升。兩者都具有不可否認的價值主張，可以最大化我們客戶的價值鏈，同時為我們的股東帶來有意義的投資回報。

With that in mind, I'd like to turn to Slide 7 and touch on our second quarter highlights. I'm pleased with the overall results as we delivered a 72% increase in total revenues in the second quarter of 2022. We also had strong growth in gross profit, which more than doubled from the first quarter of 2023. We reported positive adjusted gross profit for the second consecutive quarter and showed an improvement in adjusted EBITDA for the eighth consecutive quarter and are now forecasting positive adjusted EBITDA before year-end.

考慮到這一點，我想轉向幻燈片 7，談談我們第二季度的亮點。我對整體業績感到滿意，因為我們在2022 年第二季度的總收入增長了72%。我們的毛利潤也出現了強勁增長，比2023 年第一季度增長了一倍多。我們報告了正調整後毛利潤連續第二個季度盈利，調整後 EBITDA 連續第八個季度有所改善，目前預計年底前調整後 EBITDA 為正值。

Our transactional chemistry business revenues increased 68% from the first quarter of 2023. This is due to our rapidly expanding customer base and continued adoption of our Prescriptive Chemistry Management business model, which has exhibited 171% growth in applications of our proprietary Complex nano-Fluids compared to the second quarter of 2022. Also, our Data Analytics revenues have continued to gain momentum as the first half of 2023 revenues have approximately equaled what we had in all of 2022.

我們的交易化學業務收入較2023 年第一季度增長了68%。這是由於我們快速擴大的客戶群以及我們的處方化學管理業務模式的持續採用，該模式在我們專有的複雜納米流體的應用中表現出171% 的增長與 2022 年第二季度相比。此外，我們的數據分析收入繼續保持增長勢頭，2023 年上半年的收入大致等於 2022 年全年的收入。

These improved results reflect the positive and impactful changes we have achieved during a very short period of time. Most importantly, all of these milestones were achieved with 0 recordable and lost time incidences in the field of operations. I'd like to thank all of our employees for their commitment to safety and service quality in achieving these outstanding results.

這些改進的結果反映了我們在很短的時間內取得的積極和有影響力的變化。最重要的是，所有這些里程碑都是在操作領域實現了 0 可記錄和誤工事件。我要感謝我們所有員工對安全和服務質量的承諾，才取得了這些出色的成果。

Now as highlighted on Slide 12, Flotek continues to differentiate itself as the collaborative partner of choice in the industry for sustainable, optimized chemistry and data solutions for E&P operators and oilfield service providers. What truly distinguishes Flotek from its peers is our global presence in over 15 countries, including all major U.S. shale basins and our extensive expertise providing sustainable, chemical and data solutions on over 20,000 completed wells worldwide.

現在，正如幻燈片 12 所強調的那樣，Flotek 繼續將自己定位為行業中首選的合作夥伴，為 E&P 運營商和油田服務提供商提供可持續、優化的化學和數據解決方案。 Flotek 與同行的真正區別在於我們在超過15 個國家/地區的全球業務，包括美國所有主要頁岩盆地，以及我們為全球20,000 多口已完井提供可持續、化學和數據解決方案的廣泛專業知識。

A recent example of this differentiation is the approval of Flotek's slick water system by Aramco. Our fluid solution is now 1 of only 2 approved hydraulic fracturing systems currently being utilized in Saudi Arabia. This competitive advantage not only relates to being technologically advanced, but also being operationally efficient in reducing cost and environmental impact while improving the overall performance of our customers' assets.

這種差異化的最新例子是阿美石油公司 (Aramco) 批准了 Flotek 的滑水系統。我們的流體解決方案現已成為沙特阿拉伯目前使用的僅有的 2 個經批准的水力壓裂系統之一。這種競爭優勢不僅涉及技術先進，還涉及在降低成本和環境影響方面的運營效率，同時提高客戶資產的整體性能。

Another important aspect of Flotek's competitive advantage is our producer customers reporting enhanced well productivity while utilizing our chemistry applications. Slide 16 depicts a comparative production analysis of wells utilizing Flotek's Prescriptive Chemistry Management for wells in the Permian Basin versus wells from non-Flotek wells. As shown in the graph, wells that employed our Prescriptive Chemistry Management exhibited a 26% average uplift in performance or a cumulative increase of 75,000 barrels of oil equivalent after 24 months compared to wells that did not have Flotek chemistry. This highlights how powerful Flotek's chemistry solutions are in delivering improved asset performance. While this only represents a sample of results from the Permian Basin, we have also seen similar results in all other shale basins.

Flotek 競爭優勢的另一個重要方面是我們的生產商客戶報告說，在利用我們的化學應用程序時，油井生產力得到了提高。幻燈片 16 描述了對二疊紀盆地的井和非 Flotek 井使用 Flotek 規範化學管理的井進行的生產對比分析。如圖所示，與未採用 Flotek 化學管理的油井相比，採用我們的規範化學管理的油井在 24 個月後表現出平均性能提升 26%，即累計增加 75,000 桶油當量。這突顯了 Flotek 化學解決方案在提高資產性能方面的強大作用。雖然這僅代表二疊紀盆地結果的樣本，但我們在所有其他頁岩盆地中也看到了類似的結果。

Turning to Slide 17. We continue to leverage our expertise into emerging and existing market verticals. This positions Flotek to capitalize on our proprietary patents, technology advancements and collaborative partnerships that have proven commercial applications in other industry subsectors, providing significant future growth opportunities while diversifying our revenue stack. We believe that the demand for our sustainable chemistry solutions will continue to increase and will provide opportunities in other international and domestic market verticals, such as industrial, geothermal, agricultural, solar and hydrogen.

轉向幻燈片 17。我們繼續將我們的專業知識應用於新興和現有的垂直市場。這使得Flotek 能夠利用我們的專有專利、技術進步和合作夥伴關係，這些專利、技術進步和合作夥伴關係已在其他行業子行業中得到驗證的商業應用，提供重大的未來增長機會，同時使我們的收入來源多樣化。我們相信，對我們可持續化學解決方案的需求將繼續增加，並將為其他國際和國內垂直市場提供機會，例如工業、地熱、農業、太陽能和氫能。

Turning now to Slide 18. As discussed last quarter, our Data Analytics segment received the first prototype of the next-generation spectrometer for field testing and validation, which is shown on the slide. The proprietary Verax analyzer can monitor the quality of hydrocarbons in real time versus traditional sampling practices. When operational, this next-generation Verax unit will represent a massive step change in our manufacturing capabilities and operational costs for the Data Analytics segment as we make the important transition to a more subscription-based service model.

現在轉向幻燈片 18。正如上個季度所討論的，我們的數據分析部門收到了用於現場測試和驗證的下一代光譜儀的第一個原型，如幻燈片所示。與傳統採樣方法相比，專有的 Verax 分析儀可以實時監測碳氫化合物的質量。一旦投入運營，隨著我們向更加基於訂閱的服務模式的重要轉變，這一下一代 Verax 單元將代表我們數據分析領域的製造能力和運營成本發生巨大的變化。

As outlined on Slide 19, extensive industry applications exist throughout the upstream, midstream and downstream segments. We believe the next-generation model will have the scalability to further penetrate what we believe will be [an immense] upstream market opportunity. I would now like to turn the call over to Bond to discuss the detailed financial highlights.

如幻燈片 19 所示，廣泛的行業應用存在於上游、中游和下游領域。我們相信下一代模型將具有可擴展性，可以進一步滲透我們認為將是[巨大]的上游市場機會。我現在想把電話轉給邦德，討論詳細的財務亮點。

Thanks, Ryan. It's great to be with you all this morning. I want to start by saying that everyone here at Flotek is extremely excited about the results we announced yesterday. I think yesterday's release checks a lot of the boxes regarding items that we've been working hard to achieve and that shareholders have been wanting to see.

謝謝，瑞安。今天早上能和大家在一起真是太好了。首先我想說，Flotek 的每個人都對我們昨天宣布的結果感到非常興奮。我認為昨天的發布檢查了我們一直在努力實現的目標以及股東一直希望看到的目標的很多方面。

Moving back to Slide 7 for a bit. We reported a huge growth in gross profit. We generated strong revenue contribution from our transactional chemistry business. We provided visibility on reaching positive adjusted EBITDA before year-end, and we updated you on significant progress towards securing an ABL.

回到幻燈片 7。我們報告毛利潤大幅增長。我們的化學交易業務為我們帶來了強勁的收入貢獻。我們提供了在年底前實現正調整 EBITDA 的情況，並向您通報了在確保 ABL 方面取得的重大進展的最新情況。

Our success in execution during the first half of the year gives us confidence in achieving our full year guidance, which calls for total revenues of between $210 million and $230 million, which equates to more than 60% growth in annual revenue versus last year and achieving an 8% to 10% adjusted gross profit margin. Hitting the midpoint of these 2 metrics would represent a nearly $22 million annual improvement in adjusted gross margin versus the results we achieved last year. Obviously, quite a turnaround and an accomplishment that we're proud of.

我們上半年的成功執行使我們對實現全年指導充滿信心，該指導要求總收入在 2.1 億至 2.3 億美元之間，相當於年收入比去年增長 60% 以上，並實現調整後的毛利率為8% 至10%。達到這兩個指標的中點意味著與去年相比，調整後毛利率每年可提高近 2200 萬美元。顯然，這是一個讓我們感到自豪的轉變和成就。

Moving to the income statement. Sequentially, revenues were up 5% in spite of a well-documented pullback in upstream land activity during the quarter. As Ryan discussed, our transactional chemistry revenues jumped by more than $6 million during the quarter and ended up making up over 30% of total revenue, which is up from only 19% in the first quarter. This is a significant accomplishment as it provides a revenue source diversity in terms of reducing our customer concentration.

轉到損益表。儘管上游土地活動在本季度出現有據可查的回落，但收入仍增長了 5%。正如 Ryan 所討論的，我們的化學交易收入在本季度增長了超過 600 萬美元，最終佔總收入的 30% 以上，而第一季度僅為 19%。這是一項重大成就，因為它在降低客戶集中度方面提供了收入來源多樣性。

Turning to Slide 10. Our second quarter gross profit was up 108% from the first quarter, and our adjusted gross profit, which excludes certain noncash costs achieved a 92% jump in the first quarter. Gross profit margin and adjusted gross profit margin during the quarter increased to 8% and 10%, respectively. With back-to-back quarters of positive gross profit, our cumulative gross profit through the first 2 quarters of 2023 is running nearly $10 million higher than the cumulative gross profit for the preceding 2 final quarters of last year.

轉向幻燈片 10。我們第二季度的毛利潤比第一季度增長了 108%，調整後的毛利潤（不包括某些非現金成本）在第一季度實現了 92% 的增長。本季度毛利率和調整後毛利率分別增至8%和10%。由於連續兩個季度實現正毛利潤，我們到 2023 年前兩個季度的累計毛利潤比去年最後兩個季度的累計毛利潤高出近 1000 萬美元。

Contributing to positive margins during the quarter were $1.2 million of revenue related to the ProFrac contract modification that we announced earlier this year, along with a 13% sequential reduction in our freight costs. This marks the second consecutive quarter of double-digit reduction in freight costs. In terms of dollars, second quarter freight costs were about $0.5 million less than first quarter 2023 and about $1.3 million less than the fourth quarter of 2022. And that's in spite of revenues being 5% higher for the second quarter.

我們今年早些時候宣布的與 ProFrac 合同修改相關的 120 萬美元收入，以及我們的貨運成本環比減少 13%，為本季度帶來了正利潤。這標誌著貨運成本連續第二個季度出現兩位數下降。以美元計算，第二季度的貨運成本比 2023 年第一季度減少約 50 萬美元，比 2022 年第四季度減少約 130 萬美元。儘管第二季度的收入增長了 5%。

Moving to Slide 11. Second quarter adjusted EBITDA improved another 48% sequentially. As noted in yesterday's release, we are now forecasting reporting positive adjusted EBITDA before the end of this year. I, and I'm sure many of you are very excited about the prospect of no longer having to discuss the relative improvement in negative numbers.

轉到幻燈片 11。第二季度調整後 EBITDA 環比又增長了 48%。正如昨天的新聞稿中所指出的，我們現在預測在今年年底前將報告調整後的正 EBITDA。我相信你們中的許多人都對不再需要討論負數的相對改善的前景感到非常興奮。

Moving to SG&A. As a reminder, for everyone, the first quarter of 2023 did benefit from a $1.1 million credit for noncash stock comp that was associated with headcount reductions that we implemented in the first quarter. Excluding stock comp, SG&A during the second quarter increased by about $0.5 million and included legal fees related to the settlement of a portion of our legacy litigation, and it also included the final costs associated with our CEO transition. We have now settled 2 of the 3 components in our legacy litigation, so we're encouraged that this can be wrapped up before the end of the year. Accordingly, we expect G&A costs to trend back down during the third quarter.

轉向 SG&A。提醒大家的是，2023 年第一季度確實受益於 110 萬美元的非現金股票補償信貸，這與我們在第一季度實施的裁員相關。不包括股票補償，第二季度的銷售、管理和管理費用增加了約 50 萬美元，其中包括與解決部分遺留訴訟相關的法律費用，還包括與首席執行官過渡相關的最終成本。我們現在已經解決了遺留訴訟中 3 個組成部分中的 2 個，因此我們很高興這件事可以在今年年底之前結束。因此，我們預計第三季度一般管理費用將呈下降趨勢。

Quickly touching on the severance expense credit during the quarter. We had previously accrued certain severance costs associated with the legacy litigation just discussed. In connection with that settlement of this portion of the litigation, we were able to reverse that accrual during the second quarter.

快速討論本季度的遣散費抵免額。我們之前已經累計了與剛才討論的遺留訴訟相關的某些遣散費。隨著這部分訴訟的解決，我們能夠在第二季度扭轉該應計費用。

Moving to the bottom line. We reported a slight net loss this quarter versus $21 million of net income during the first quarter. Net income for the first quarter did benefit from a $26 million noncash gain associated with the fair value change of our convertible notes as well as a $4.5 million gain associated with our PPP loan forgiveness. The final tranche of the convertible notes converted in May to 63.5 million shares, so we'll no longer have the earnings volatility associated with the fair value measurement of the notes going forward.

移動到底線。我們報告本季度出現輕微淨虧損，而第一季度淨利潤為 2100 萬美元。第一季度的淨利潤確實受益於與可轉換票據公允價值變化相關的 2600 萬美元非現金收益以及與 PPP 貸款減免相關的 450 萬美元收益。最後一批可轉換票據已於 5 月份轉換為 6350 萬股，因此我們將不再面臨與票據公允價值計量相關的收益波動。

Touching on the balance sheet. In connection with the conversion of that final tranche of convertible notes to equity, our June 30 balance sheet is now almost completely delevered with only about $300,000 of total debt reflected.

觸及資產負債表。隨著最後一批可轉換票據轉換為股權，我們 6 月 30 日的資產負債表現在幾乎完全去槓桿化，僅反映了約 30 萬美元的總債務。

Moving to Slide 21 real quickly. I am very pleased to report considerable progress has been made towards securing an ABL facility. The fact that a loan like this was simply unavailable to Flotek a year ago, highlights the substantial financial improvements made by the company over the last few quarters. The ABL is expected to be secured by certain of our receivables, inventory as well as our Marlow, Oklahoma blending facility. We recently received credit approval from the prospective lender, and we are reviewing the loan documents currently and completing some final administrative items prior to closing. We are very excited about the expectation of announcing the results of this process well before the end of the month.

快速轉到幻燈片 21。我很高興地向大家報告，在確保 ABL 設施安全方面已經取得了相當大的進展。事實上，Flotek 一年前根本無法獲得此類貸款，這一事實凸顯了該公司在過去幾個季度中取得的重大財務改善。 ABL 預計將由我們的某些應收賬款、庫存以及我們位於俄克拉荷馬州馬洛的混合設施來保證。我們最近收到了潛在貸款人的信貸批准，目前正在審查貸款文件並在成交前完成一些最終的管理項目。我們對在本月底之前宣布這一過程的結果感到非常興奮。

Quickly touching on the NYSE sub-$1 listing issue. We're obviously going to monitor how the stock trades over the next few weeks. As we've mentioned before, our strong preference would be to cure the deficiency organically by leveraging the potential benefits from the very positive financial results we reported yesterday. Additional updates on our progress regarding an ABL as well as our participation at the EnerCom conference next week. Our compliance deadline is October 12, so we have some time before we have to decide. As a reminder, and as we mentioned last quarter, we already have shareholder approval to enact up to a 1-for-6 reverse split if necessary.

快速討論紐約證券交易所低於 1 美元的上市問題。顯然我們將在接下來的幾週內監控股票的交易情況。正如我們之前提到的，我們強烈傾向於利用我們昨天報告的非常積極的財務業績所帶來的潛在收益，有機地解決這一缺陷。有關 ABL 進展以及我們下週參加 EnerCom 會議的其他更新。我們的合規截止日期是 10 月 12 日，因此我們有一些時間才能做出決定。提醒一下，正如我們上季度提到的，我們已經獲得股東批准，可以在必要時實施最多 6 股 1 股的反向分割。

Touching upon our special shareholder meeting scheduled for September 5, we have filed the definitive proxy statement and shareholders should be receiving voting materials. We have engaged a proxy solicitor to conduct an outreach campaign to ensure that we get maximum participation from shareholders. Our Board unanimously recommends a vote for both proposals. As a reminder, everyone, shareholder approval of the June 2022 prefunded warrants held by ProFrac provides Flotek the opportunity to receive $4.5 million in cash proceeds upon the conversion of those warrants to shares. Obviously, that's something that would benefit all shareholders.

談到定於 9 月 5 日舉行的特別股東大會，我們已經提交了最終的委託書，股東應該會收到投票材料。我們聘請了一位代理律師來開展宣傳活動，以確保我們獲得股東的最大程度的參與。我們的董事會一致建議對這兩項提案進行投票。謹此提醒大家，股東對 ProFrac 持有的 2022 年 6 月預融資認股權證的批准，使 Flotek 有機會在這些認股權證轉換為股票後獲得 450 萬美元的現金收益。顯然，這將使所有股東受益。

There's a lot to be proud of in terms of what we've accomplished at the midway point of the year. Through June, we've reported a nearly $10 million improvement in adjusted gross margin and nearly $7 million improvement in adjusted EBITDA as compared to the first 6 months of last year. We expect to see gross margins continue to rise over the coming quarters, and we will keep attacking SG&A at every opportunity.

就我們在​​今年中期取得的成就而言，有很多值得自豪的事情。截至 6 月份，與去年前 6 個月相比，調整後毛利率提高了近 1000 萬美元，調整後 EBITDA 提高了近 700 萬美元。我們預計未來幾個季度的毛利率將繼續上升，我們將利用一切機會繼續攻擊銷售、管理和行政費用。

As it relates to SG&A cuts, we recently executed a new lease for our corporate headquarters. We expect to complete the move over the next 2 weeks. With a significantly reduced footprint, our new office lease will provide annual savings of over $500,000 versus the current office location we are exiting.

由於與 SG&A 削減有關，我們最近為公司總部簽訂了新的租約。我們預計在接下來的兩週內完成搬遷。由於佔地面積顯著減少，與我們現有的辦公地點相比，我們的新辦公室租賃每年將節省超過 500,000 美元。

That concludes my remarks. I'll now turn the call back over to Ryan for closing comments.

我的發言到此結束。我現在將把電話轉回瑞安以徵求結束意見。

Thanks, Bond. Now turning to Slide 22. In summary, Flotek is a compelling investment opportunity to date as the turnaround momentum we've gained in rightsizing our business and improving our profitability is not currently reflected in our share price. And I'm confident in our ability to execute our corporate strategy going forward.

謝謝，邦德。現在轉向幻燈片 22。總而言之，Flotek 迄今為止是一個引人注目的投資機會，因為我們在調整業務規模和提高盈利能力方面獲得的扭轉勢頭目前尚未反映在我們的股價中。我對我們執行未來企業戰略的能力充滿信心。

Flotek's new leadership team has deep industry experience to lead Flotek forward and execute on our next phase of growth. We have complementary business segments, and we'll continue to drive revenue expansion and a sustained improvement in profitability as we anticipate delivering greater than 60% growth in annual revenues and greater than $20 million in annual gross margin improvement.

Flotek 的新領導團隊擁有豐富的行業經驗，能夠帶領 Flotek 前進並執行我們下一階段的增長。我們擁有互補的業務部門，我們將繼續推動收入擴張和盈利能力持續提高，預計年收入增長超過 60%，年毛利率提高超過 2000 萬美元。

We maintain a $2 billion backlog of future revenue over the next decade as supported by our long-term ProFrac partnership. In addition, we expect ongoing domestic and international growth in our high-margin transactional chemistry and data analytics businesses as we continue to gain market share in both areas.

在我們長期的 ProFrac 合作夥伴關係的支持下，我們在未來十年保持著 20 億美元的積壓未來收入。此外，隨著我​​們繼續在這兩個領域獲得市場份額，我們預計我們的高利潤交易化學和數據分析業務將在國內和國際上持續增長。

We also continue to benefit from our cost control initiatives that enhance profitability and underpin a transition to positive adjusted EBITDA by year-end. And finally, we maintain a strong balance sheet with very little debt that has to be augmented with the additional liquidity from the proposed ABL facility we are working to put in place in the near term.

我們還繼續受益於我們的成本控制舉措，這些舉措提高了盈利能力，並支持到年底向正調整 EBITDA 過渡。最後，我們保持了強勁的資產負債表，債務很少，必須通過我們正在努力在短期內落實的擬議 ABL 設施提供的額外流動性來增強資產負債表。

We realized that there is more work to be done, but we are all positioned to capitalize on the significant opportunity set we have before us as we build value for our shareholders. We appreciate the continued support of all our stakeholders, and we hope that you'll share our excitement regarding the future of Flotek.

我們意識到還有更多工作要做，但我們都準備好利用擺在我們面前的重大機遇，為股東創造價值。我們感謝所有利益相關者的持續支持，希望您能分享我們對 Flotek 未來的興奮之情。

Operator, we are now ready to take questions.

接線員，我們現在準備好回答問題。

(Operator Instructions) The first question comes from Don Crist with Johnson Rice.

（操作員說明）第一個問題來自 Don Crist 和 Johnson Rice。

Ryan, I wanted to start on Slide 16. Obviously, I haven't seen this data before. But the 26% uplift in well performance. Number one, how widespread or how many wells is that covering? And number two, is this really kind of getting some traction for your transactional business out there in the Permian?

Ryan，我想從幻燈片 16 開始。顯然，我以前沒有見過這些數據。但油井性能提升了 26%。第一，覆蓋範圍有多廣或有多少口井？第二，這真的能為您在二疊紀盆地的交易業務帶來一些吸引力嗎？

Yes. Don, when you look at this data, we were very meticulous about how we went at doing this analysis, and we looked at over 1,800 wells in the Permian Basin. More importantly, we set strict guidelines on when we looked at it, lateral length, completion design, proppant intensity and fluid system choice, which we got from the publicly available data. And you're 100% correct that we are starting to see significant traction in our transactional business, driven by the value proposition around our customized chemistry technologies.

是的。 Don，當您查看這些數據時，我們非常仔細地進行分析，並且查看了二疊紀盆地的 1,800 多口井。更重要的是，我們從公開數據中獲得了關於何時查看橫向長度、完井設計、支撐劑強度和流體系統選擇的嚴格指導方針。您說得100%正確，在我們定制化學技術的價值主張的推動下，我們的交易業務開始受到巨大的關注。

And what's unique about this is we went down this pursuit. It's kind of been a long-term pursuit for us. In that, we started these EUR type interactions with our customers almost 18 months ago, and you're really starting to see them come to fruition as you can see what's coming out of this data.

其獨特之處在於我們不斷追求這一目標。這對我們來說是一個長期的追求。在這一點上，我們大約 18 個月前開始與客戶進行歐元類型的互動，您真的開始看到它們取得成果，因為您可以看到這些數據的結果。

It's very exciting data. And one other question on the cost side. You called out freight and logistics cost coming down. I know you've been working on that for quite a while. Where are we in that progress? And do you see additional cost savings going forward?

這是非常令人興奮的數據。還有一個關於成本方面的問題。您呼籲運費和物流成本下降。我知道你已經為此努力了一段時間了。我們目前進展到了什麼程度？您認為未來會節省更多成本嗎？

Yes. So if we look at freight, when you look at, say, where we ended the year in Q4 of '22 versus this current quarter, our freight costs were down about $1.3 million when we had an increase of almost $500,000 in revenue. And more importantly, we saw -- just from Q1 to Q2, we saw a $500,000 drop in freight costs with increasing revenue. So you can start to imagine that we are gaining significant efficiencies in terms of how we look at our long-term short hauls and also what we look [at infield] delivery.

是的。因此，如果我們看一下貨運，比如說，與本季度相比，我們在 22 年第四季度結束時，我們的貨運成本下降了約 130 萬美元，而我們的收入增加了近 50 萬美元。更重要的是，我們看到，僅從第一季度到第二季度，隨著收入的增加，貨運成本下降了 50 萬美元。因此，您可以開始想像，我們在如何看待長期短途運輸以及我們如何看待[內場]交付方面正在獲得顯著的效率。

Okay. And Bond, just one for you. Now that the convertible notes are all converted, can we get a clean share count? I mean, obviously, there's the warrant center still out there, but what's the clean share count today?

好的。還有邦德，就是為你準備的。現在可轉換票據已全部轉換，我們可以獲得乾淨的股份數量嗎？我的意思是，顯然，認股權證中心仍然存在，但今天的淨股數是多少？

Yes. Assuming both of the items in the special meeting passed, there's 2 tranches of prefunded warrants that need to be approved by shareholders. The final share count is going to be somewhere around 190 million shares.

是的。假設特別會議上的兩項議題均獲得通過，則有兩批預撥認股權證需要獲得股東批准。最終的股票數量將約為 1.9 億股。

All right. I appreciate the color, guys. Good quarter. I'll turn it back.

好的。我很欣賞這個顏色，伙計們。好季度。我會把它轉回來。

Our next question comes from Richard Dearnley with Longport Partners.

我們的下一個問題來自 Longport Partners 的理查德·迪恩利 (Richard Dearnley)。

Doing the math on your comments about transactional business being 30% of revenue, that would be about $15.2 million versus $9.1 million in the first quarter. Am I getting that correctly?

根據您關於交易業務佔收入 30% 的評論進行計算，這一數字約為 1,520 萬美元，而第一季度為 910 萬美元。我理解正確嗎？

That's correct. It was up about $6 million Q1 to Q2.

這是正確的。第一季度至第二季度增長了約 600 萬美元。

Right. So then your ProFrac business would be down about 11% quarter-to-quarter?

正確的。那麼您的 ProFrac 業務將環比下降約 11% 嗎？

Yes. It's off about 10% from the first quarter. That's correct as well.

是的。較第一季度下降約 10%。這也是正確的。

And what were the dynamics there?

那裡的動態是什麼？

So there's a couple of things to look at. And so a lot of this has been spoken about in the public market is that what we've seen is a little bit of disruption in activity where the E&P operators who are transacting the business for pressure pumping activities and completions, we've started to see what I would call white space in between activities. Traditionally speaking, we would see 1 to 2 days, maybe 3 days transitioning pad to pad, et cetera. But we're seeing a lot of customers buying in the spot market, and we're seeing bigger delays between pads, sometimes 5 to 7 days.

所以有幾件事需要注意。因此，公開市場上談論的很多內容是，我們所看到的活動受到了一點干擾，正在處理壓力泵活動和完井業務的勘探與生產運營商，我們已經開始看看我所說的活動之間的空白。傳統上講，我們會看到 1 到 2 天，甚至 3 天的時間來更換墊子，等等。但我們看到很多客戶在現貨市場購買，而且我們發現墊之間的延遲更大，有時為 5 到 7 天。

So although your average fleet count is staying relatively the same quarter-on-quarter, the amount of activity or pumping days went down a little bit. And so with some of that, we would look at our total fleet count. We moved chemistry on a similar number of fleets. But when you average out the volume, it was down a little bit, particularly in what we saw in May, but we've seen that come back strong in July and coming into August.

因此，儘管您的平均機隊數量與上一季度相比保持相對相同，但活動量或泵送天數略有下降。因此，我們會看看我們的機隊總數。我們在類似數量的艦隊上轉移了化學物質。但當你平均成交量時，會發現成交量略有下降，特別是我們在 5 月份看到的情況，但我們看到成交量在 7 月份和 8 月份強勁回升。

Right, I see. And on Slide 16, back to the productivity question. How much of that improvement is -- this is a soft guess kind of answer, but how much of that is due to analytics? How much is due to nano-Fluids? And how much is due to the rest of everything?

對，我明白了。在幻燈片 16 上，回到生產力問題。這種改進有多少是——這是一種軟猜測的答案，但其中有多少是由於分析帶來的？有多少是由於納米流體造成的？還有多少是由於其餘的一切造成的？

So that's a great question and something that we have kind of combined in our overall approach. You heard me mention that we have 20,000 wells under the belt of applications of our chemistry. So in combination with what our Data Analytics group does with the chemistry, we've done a lot of, I would say, machine learning on applications of our proprietary chemistries in the various basins and target zones. And we've brought that into discussions with our customers, how we choose our chemistry.

所以這是一個很好的問題，我們已經將其結合到我們的整體方法中。您聽到我提到我們在化學應用領域擁有 20,000 口井。因此，結合我們的數據分析小組在化學方面所做的工作，我想說，我們對我們專有的化學物質在各個盆地和目標區域的應用進行了大量的機器學習。我們已將這一點納入與客戶的討論中，討論我們如何選擇我們的化學品。

And what's even more important is we look at our overall engineering process that we call Prescriptive Chemistry Management where we look at the X-ray diffraction of the cuttings and core samples, we look at the produced water and its composition, we look at the compositional analysis of the potential crude and hydrocarbons that are coming out of the reservoir. And we also look at other potential opportunities around the biocide selections, et cetera.

更重要的是，我們著眼於我們稱之為規範化學管理的整體工程流程，我們著眼於岩屑和岩心樣本的 X 射線衍射，我們著眼於產出水及其成分，我們著眼於成分分析從油藏中流出的潛在原油和碳氫化合物。我們還關注殺菌劑選擇等方面的其他潛在機會。

And we give them a holistic customized approach, which is choosing the right friction reducer, clay control, corrosion components as well as when we can have an application of a surfactant enhanced possibility, which you look at as a [flowback aid] or a Complex nano-Fluids. Because what we see is sometimes, traditionally, when [it's just] look at pure Complex nano-Fluids, it's a little bit higher, but we look at a holistic approach of the chemistry management side. And that's where we get the 26% number. And I will say it varies well to well, depending on the formation type and completion design.

我們為他們提供整體定制方法，即選擇正確的減摩劑、粘土控制、腐蝕成分，以及何時應用表面活性劑增強可能性，您將其視為[回流助劑]或複合物納米流體。因為我們有時看到的是，傳統上，當[它只是]考慮純複雜納米流體時，它會稍微高一點，但我們會考慮化學管理方面的整體方法。這就是我們得到 26% 的數字。我想說的是，它因井而異，具體取決於地層類型和完井設計。

So you're saying that it's not possible to break out the nano-Fluids and the analytics and so on? It's just a [big package].

所以你是說不可能突破納米流體和分析等等？這只是一個[大包裹]。

I think it is in terms of we can look at it just where we have specific to just Complex nano-Fluid is being applied. We have those analytics. But we like to prefer to look at our holistic engineering approach for the full design of the slick water system that we're utilizing. But we do have that data. And in some of -- I think some of the more detailed presentations that we'll be doing at some of the upcoming investor conferences, we'll talk specifically around impacts of Complex nano-Fluids versus the full engineering and scope design.

我認為這是因為我們可以在我們特定於應用複雜納米流體的地方查看它。我們有這些分析。但我們更願意關注我們正在使用的滑溜水系統的完整設計的整體工程方法。但我們確實有這些數據。在一些——我認為我們將在即將舉行的一些投資者會議上進行的一些更詳細的演示中，我們將專門討論複雜納米流體與完整工程和範圍設計的影響。

(Operator Instructions) At this time, there are no more questions. The next question comes from Don Crist with Johnson Rice.

（操作員說明） 此時，沒有更多問題了。下一個問題來自唐·克里斯特和約翰遜·賴斯。

Ryan, I just want to ask about JP3. Obviously, you had some field tests going on with the new design. Where are we in that? And are you seeing some interest in more widespread adoption of JP3?

Ryan，我只是想問一下JP3 的事。顯然，您對新設計進行了一些現場測試。我們在哪裡？您是否對更廣泛採用 JP3 感興趣？

Yes. Don, that's another good question is that, as I mentioned, we have the new generation model in the field testing. We've got 2 units. The testing has grown -- gone phenomenal. And we're expecting scale up of that business coming to the latter part of Q4 and going into 2024 for having the new units on the production side coming out and that's opened up.

是的。唐，另一個好問題是，正如我提到的，我們已經在現場測試了新一代模型。我們有 2 個單位。測試已經增長——變得驚人。我們預計該業務將在第四季度後期擴大規模，並進入 2024 年，因為生產方面的新單位將會問世並開放。

We recently went over with our Board kind of the strategic applications of this new technology into the field. And we see significant opportunities in the upstream segment by looking at the quality and energy count and BTUs and natural gas. We look at flare gas operations and we also look at power generation overall, whether you're powering rigs, frac fleets, electrical turbines, et cetera. So we're really excited about JP3.

我們最近與董事會討論了這項新技術在該領域的戰略應用。通過觀察質量和能源數量以及 BTU 和天然氣，我們看到了上游領域的重大機遇。我們關注火炬氣運營，也關注整體發電，無論您是為鑽機、壓裂船隊、電動渦輪機等提供動力。所以我們對 JP3 感到非常興奮。

And when you look at what JP3 and chemistry do together, we see not only applications in domestically North America land, but we see significant applications for these internationally for both units and then particularly even offshore for our chemistry. So it's really exciting about what synergies being created between data and chemistry alone because data is the monitoring of the actual chemistry at the well site.

當你看看 JP3 和化學一起做什麼時，我們不僅看到北美國內陸地上的應用，而且我們看到這兩個裝置在國際上的重要應用，特別是我們化學的海上應用。因此，數據和化學之間產生的協同作用確實令人興奮，因為數據是對井場實際化學的監測。

Right. That's very exciting going forward. Bond, if I can ask just one more with you as well. Obviously, there were some moving parts in G&A this quarter. Are you still pretty confident that you can get it close to that $5 million a quarter run rate or below by year-end?

正確的。未來的發展非常令人興奮。邦德，我還能再問你一個問題嗎？顯然，本季度的一般管理費用有一些變化。您仍然非常有信心在年底前能夠將其運行成本接近 500 萬美元或更低嗎？

Yes. We're working hard. That's the goal internally. We just -- we had a few items that we mentioned here, some higher legal costs. We're trying to get this litigation wrapped up. We were able to knock out 2 of the 3 components. We have one piece left. We've got the CEO transition cost behind us. So yes, I mean, Don, that's the goal internally, and that's what we're working towards.

是的。我們正在努力工作。這就是內部目標。我們只是 - 我們有一些我們在這裡提到的項目，一些更高的法律費用。我們正在努力結束這場訴訟。我們能夠消除 3 個組件中的 2 個。我們還剩下一件。我們已經擺脫了首席執行官過渡成本。所以，是的，我的意思是，唐，這就是我們的內部目標，也是我們正在努力的方向。

I'm looking forward to seeing positive EBITDA going forward. I appreciate it guys. Good color.

我期待看到未來積極的 EBITDA。我很感激你們。顏色好。

This concludes our question-and-answer session. I would like to turn the conference back over to Larry Busnardo for any closing remarks.

我們的問答環節到此結束。我想將會議轉回拉里·布斯納多 (Larry Busnardo) 發表閉幕詞。

Thank you again for joining us today. I would like to remind you that Flotek's CEO, Ryan Ezell, will be presenting next Tuesday, August 15 at EnerCom Denver, the Energy Investment Conference in Denver at 8:50 a.m. Mountain time. He will be joined by CFO, Bond Clement, in hosting meetings with investors throughout the day. A copy of the presentation that will be posted to the website -- a copy of the presentation will be posted to the website prior to the start of the presentation. Dr. Ezell will also be participating in a service industry panel discussion at the same conference on August 16 at 9:50 a.m. Both events will be webcast, and we look forward to seeing many of you next week. Thank you again for joining us today. Please feel free to contact the company if you have any additional questions. Have a good day.

再次感謝您今天加入我們。我想提醒您，Flotek 首席執行官 Ryan Ezell 將於山地時間下週二（8 月 15 日）上午 8:50 在丹佛能源投資會議 EnerCom Denver 上發表演講。首席財務官 Bond Clement 將與他一起主持全天與投資者的會議。將發佈到網站的演示文稿副本——演示文稿的副本將在演示開始之前發佈到網站。 Ezell 博士還將參加 8 月 16 日上午 9:50 在同一會議上舉行的服務業小組討論。這兩個活動都將進行網絡直播，我們期待下週見到你們中的許多人。再次感謝您今天加入我們。如果您還有任何其他問題，請隨時與公司聯繫。祝你有美好的一天。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連接。