Natural Gas Services Group Inc (NGS) 2024 Q2 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to the Natural Gas Services Group Inc., quarter two earnings call. (Operator Instructions)

早安，女士們、先生們，歡迎參加天然氣服務集團公司第二季財報電話會議。 （操作員說明）

I would now like to turn the call over to Ms. Anna Delgado. Please begin.

我現在想把電話轉給安娜·德爾加多女士。請開始。

Thank you, Luke, and good morning, everyone.

謝謝你，盧克，大家早安。

Before we begin, I would like to remind you that during the course of this conference call, the company will be making forward-looking statements within the meaning of federal securities laws. Investors are cautioned that forward-looking statements are not guarantees of future performance, and those actual results or developments may differ materially from those projected in the forward-looking statements.

在我們開始之前，我想提醒您，在本次電話會議期間，本公司將做出聯邦證券法含義內的前瞻性聲明。請投資人注意，前瞻性陳述並不能保證未來業績，實際結果或發展可能與前瞻性陳述中的預測有重大差異。

Finally, the company can give no assurance that such forward-looking statements will prove to be correct. Natural Gas Services Group disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

最後，該公司不能保證此類前瞻性聲明將被證明是正確的。天然氣服務集團不承擔任何更新或修改任何前瞻性聲明的意圖或義務，無論是由於新資訊、未來事件或其他原因。

Accordingly, you should not place undue reliance on forward-looking statements. These and other risks are described in yesterday's earnings press release and in our filings with the SEC, including our Form 10-Q for the period ended June 30, 2024, and Form 8-Ks and in our Form 10-K for the year ended December 31, 2023. These documents can be found in the Investors section of our website located at www.ngsgi.com. Should one or more of these risks materialize or should underlying assumptions prove incorrect, actual results may vary materially.

因此，您不應過度依賴前瞻性陳述。這些風險和其他風險在昨天的收益新聞稿和我們向SEC 提交的文件中進行了描述，包括截至2024 年6 月30 日的期間的10-Q 表格、截至2024 年6 月30 日的期間的8 -K 表格和10-K 表格2023 年 12 月 31 日。如果其中一項或多項風險成為現實，或者基本假設被證明不正確，則實際結果可能會產生重大差異。

In addition, our discussion today will reference certain non-GAAP financial measures, including EBITDA, adjusted EBITDA and adjusted gross margin, among others. For reconciliations of these non-GAAP financial measures to the most directly comparable measures under GAAP, please see yesterday's earnings release.

此外，我們今天的討論將參考某些非公認會計準則財務指標，包括 EBITDA、調整後 EBITDA 和調整後毛利率等。有關這些非公認會計原則財務指標與公認會計原則下最直接可比較指標的調節表，請參閱昨天的收益報告。

I will now turn the call over to our Chief Executive Officer, Justin Jacobs. Justin?

我現在將把電話轉給我們的執行長賈斯汀·雅各布斯。賈斯汀？

Thank you, Anna, and good morning. I'd like to welcome everyone to our second quarter 2024 earnings conference call. Thank you for joining us this morning. We appreciate your interest in Natural Gas Services Group. I'll start by introducing the team.

謝謝你，安娜，早安。歡迎大家參加我們的 2024 年第二季財報電話會議。感謝您今天早上加入我們。我們感謝您對天然氣服務集團的興趣。我先介紹一下團隊。

Joining me on the call this morning is Brian Tucker, our President and Chief Operating Officer; and John Bittner, our Interim Chief Financial Officer. I'll start today with a quick recap of the quarter, a brief discussion of updated guidance followed by some high-level remarks regarding the industry.

今天早上與我一起參加電話會議的是我們的總裁兼營運長布萊恩·塔克 (Brian Tucker)。和我們的臨時財務長約翰比特納。今天，我將首先快速回顧本季度，簡要討論更新後的指導意見，然後發表一些有關該行業的高層評論。

I'll move next to our strategy with our four areas of growth opportunities and value levers and our progress to date. I'll then turn the call over to John Bittner, who will review the quarter in more detail. I'll end with a few closing comments on our increased guidance for 2024 and our longer-term outlook, which remains quite bullish.

接下來我將介紹我們的策略，包括成長機會和價值槓桿的四個領域以及我們迄今為止的進展。然後我會將電話轉給約翰·比特納 (John Bittner)，他將更詳細地審查本季。最後，我將就我們增加的 2024 年指引和長期前景發表一些總結評論，該前景仍然相當樂觀。

As for our Q2 results, we are quite pleased with our performance as we reported higher revenue net cash from operations and adjusted EBITDA, while delivering tangible results against the key growth and value levers I outlined in our last call. We reported a 45% increase in rental revenue year over year and a 4% increase sequentially with the growth driven by more horsepower rented as well as rate increases.

至於我們第二季的業績，我們對我們的表現非常滿意，因為我們報告了更高的營運收入淨現金和調整後的EBITDA，同時根據我在上次電話會議中概述的關鍵增長和價值槓桿取得了切實的成果。我們報告稱，租賃收入年增 45%，季增 4%，成長是由租賃馬力增加和費率上漲所推動的。

Adjusted EBITDA of $16.5 million increased 67% compared to last year's second quarter and looking sequentially is right between our prior two quarters, which were $16.3 million and $16.9 million. Based on our results year to date and our favorable outlook moving into the second half of the year, we increased our 2024 adjusted EBITDA outlook from $61 million to $67 million to a range of $64 million to $68 million.

調整後 EBITDA 為 1,650 萬美元，與去年第二季度相比增長了 67%，按順序來看，我們的前兩個季度（分別為 1,630 萬美元和 1,690 萬美元）是正確的。根據我們今年迄今的業績以及我們對下半年的樂觀前景，我們將 2024 年調整後 EBITDA 前景從 6,100 萬美元至 6,700 萬美元上調至 6,400 萬美元至 6,800 萬美元。

At the midpoint of the range, this equates to roughly 45% growth over 2023 after posting growth of 56% last year. I'm certainly pleased with our Q2 performance, but I am particularly excited to announce our future growth plans. We are taking advantage of supply constraints strong customer demand for both our equipment and service levels, along with our greater access to capital to grow our rental fleet.

以該範圍的中點計算，這相當於繼去年增長 56% 後，到 2023 年增長約 45%。我當然對我們第二季的業績感到滿意，但我特別高興地宣布我們未來的成長計劃。我們正在利用供應限制，客戶對我們的設備和服務水準的強烈需求，以及我們更容易獲得的資金來發展我們的租賃車隊。

We increased our outlook for growth CapEx for 2024, and we expect it will be even higher in 2025. The increase to our CapEx guidance is to support the new long-term contracts we've recently signed with Premier customers, including a long-term customer who will become our second largest customer once all these new units are operating in the field. The new contracts are all for large horsepower compression investments above our average rental rate for the fleet and above our target rate of return.

我們上調了 2024 年資本支出增長預期，預計 2025 年將會更高。將成為我們的第二大客戶。新合約全部用於大馬力壓縮投資，高於我們的機隊平均租金率和高於我們的目標回報率。

Importantly, approximately 40% of the horsepower added as a result of these new contracts will be electric motor-driven units. I think it is a testament to the strength of our customer relationships and the technological innovation of our units that we were able to move into the large horsepower electric space in an organic nature.

重要的是，這些新合約增加的約 40% 的馬力將是電動馬達驅動的裝置。我認為，我們能夠有機地進入大馬力電動領域，這證明了我們客戶關係的實力和我們單位的技術創新。

Going forward, we can address market demand in any combination of natural gas engines and electric motor-driven compression. With these new units, we have taken an important step to diversify our customer mix, reduce concentration with larger accounts and enhance our rental fleet capabilities.

展望未來，我們可以滿足天然氣引擎和電動馬達驅動壓縮的任意組合的市場需求。有了這些新單位，我們邁出了重要的一步，使我們的客戶結構多樣化，減少對大客戶的集中度，並增強我們的租賃車隊能力。

I'd like to take a second to thank all of our team members working out in the field. From the mechanics turning wrenches through district management. We could not have done this without your dedication and commitment to exceptional service.

我想花一點時間感謝我們所有在現場工作的團隊成員。從機械師轉動扳手到地區管理。如果沒有您的奉獻精神和對卓越服務的承諾，我們不可能做到這一點。

As for the market, both near- and long-term industry dynamics remain strong for us, and my comments from prior quarters hold true today. Demand for high horsepower compression remains strong, both from existing customers as well as new ones as evidenced by the new contracts we announced for large horsepower units.

至於市場，近期和長期的行業動態對我們來說仍然強勁，我之前幾季的評論今天仍然適用。對高馬力壓縮的需求仍然強勁，無論是現有客戶還是新客戶，我們宣布的大馬力機組新合約就證明了這一點。

While the natural gas industry continues to see some instability in terms of pricing, this has a lesser impact on us as approximately 75% of our active fleet is in oil and liquids-oriented basins where activity is primarily driven by oil. Crude oil prices remain relatively stable and the industry forecasts anticipate increased production over the coming years. As we look at the industry opportunity, we see significant growth on the horizon as customers are already looking out as far as 2026.

雖然天然氣產業在定價方面繼續存在一些不穩定，但這對我們的影響較小，因為我們大約 75% 的活躍船隊位於石油和液體導向盆地，這些盆地的活動主要由石油驅動。原油價格保持相對穩定，產業預測未來幾年產量將會增加。當我們審視行業機會時，我們看到了即將出現的顯著成長，因為客戶已經在展望 2026 年。

I'd like to shift now to our strategy. using the four growth opportunities and value levers that I've discussed as the framework for tracking our progress. To recap, the first is optimizing our utilized fleet second, improving our asset utilization. Third, driving new unit growth, particularly in large horsepower. And fourth, executing accretive M&A.

我現在想談談我們的策略。使用我討論過的四個成長機會和價值槓桿作為追蹤我們進展的框架。回顧一下，首先是優化我們的使用機隊，其次是提高我們的資產利用率。第三，推動新機組成長，特別是大馬力機組。第四，執行增值併購。

In Q2 and since quarter end, I believe we showed demonstrable progress against two of these buckets, leading to our strong quarterly results and increased 2024 guidance. Let me start with asset utilization which encompasses two parts, converting noncash assets into cash and increasing the utilization of our existing fleet.

在第二季和季末以來，我相信我們在其中兩個方面取得了明顯的進展，從而實現了強勁的季度業績並提高了 2024 年指引。讓我從資產利用率開始，包括兩個部分，將非現金資產轉化為現金以及提高現有機隊的使用率。

With respect to the former, our accounts receivable went from $42 million to $33 million, a $9 million cash improvement in one quarter. This represents approximately $0.75 per share in cash. We believe there is more opportunity to reduce accounts receivable as well as create cash from other assets, notably the income tax receivable and owned real estate. I'm confident -- I am confident that as we continue to execute, you will see more of our noncash assets converted into cash, leading to higher returns for our shareholders.

就前者而言，我們的應收帳款從 4,200 萬美元增加到 3,300 萬美元，一個季度內現金增加了 900 萬美元。這相當於每股約 0.75 美元的現金。我們認為，有更多機會減少應收帳款以及從其他資產（特別是應收所得稅和自有房地產）創造現金。我有信心——我相信，隨著我們繼續執行，您將看到我們更多的非現金資產轉化為現金，為我們的股東帶來更高的回報。

As I noted on our last quarter call. This is an ongoing initiative and will take up to 24 months to fully execute. With respect to increasing utilization of our rental fleet, this is a key priority for us, but more of a medium-term initiative as we look to make modest investments in our fleet to upgrade technology, convert units and increase unit readiness. We expect to have more information to share in future quarters.

正如我在上個季度的電話會議中指出的那樣。這是一項持續的舉措，需要長達 24 個月的時間才能完全執行。關於提高租賃機隊的利用率，這是我們的首要任務，但更多的是一項中期舉措，因為我們希望對機隊進行適度投資，以升級技術、轉換設備並提高設備準備。我們期望在未來幾季分享更多資訊。

Next key opportunity is our fleet expansion. And here, we have made consistent progress with significantly more to come. As of June 30, we had 1,242 natural gas compressors, totaling approximately 455,000 horsepower rented, representing a 22% increase in horsepower rented year over year. Horsepower utilization stood at 82.3%, which was up 370 basis points from last year. In our earnings release, we announced new contracts with blue-chip customers to expand our fleet.

下一個關鍵機會是我們的機隊擴張。在這方面，我們已經取得了持續的進展，未來還會取得更多進展。截至6月30日，我們擁有1,242台天然氣壓縮機，租賃總馬力約455,000馬力，租賃馬力年增22%。馬力利用率為82.3%，比去年上升370個基點。在我們的財報中，我們宣布了與藍籌客戶的新合同，以擴大我們的機隊。

As I mentioned, all of the new units are large horsepower and a significant portion are electric-driven compression units. We will be increasing our growth CapEx this year and next year to support these contracts something we are able to do given our leverage position and larger credit facility. These are material awards for natural gas services and are all long-term contracts with return on invested capital projected above our target rate of 20%.

正如我所提到的，所有新機組都是大馬力，其中很大一部分是電動壓縮機組。我們將在今年和明年增加我們的成長資本支出，以支持這些合同，鑑於我們的槓桿狀況和更大的信貸額度，我們能夠做到這一點。這些是針對天然氣服務的物質獎勵，並且都是長期合同，投資資本回報率預計高於我們 20% 的目標率。

As a result, I believe we'll see strong growth in revenue, utilization, profitability and cash flow. A key driver of these new contracts is our technology and commitment to innovation. We are consistently hearing this from our customers. Our technology stands apart as does our service and commitment to exceed customer expectations.

因此，我相信我們將看到收入、利用率、獲利能力和現金流的強勁成長。這些新合約的關鍵驅動力是我們的技術和對創新的承諾。我們不斷從客戶那裡聽到這樣的說法。我們的技術與眾不同，我們的服務和超越客戶期望的承諾也是如此。

Again, with many of our customers looking out towards 2026, this is another good sign for the future. And beyond the new awards, our pipeline is growing as is interest from large potential customers.

同樣，我們的許多客戶都在展望 2026 年，這是未來的另一個好兆頭。除了新獎項之外，隨著大型潛在客戶的興趣，我們的管道也在不斷增長。

I'll come back to this of my closing remarks. And it's now my pleasure to turn the call over to John.

我將回到我的結束語。現在我很高興將電話轉給約翰。

Thank you, Justin, and good morning, everyone. Let me jump into the review of our second quarter results. Total revenue for the three months ended June 30, 2024, increased to $38.5 million, which was up $11.5 million or 43% from $27 million in Q2 2023. Our revenue was up from $36.9 million for the three months ended March 31, 2024.

謝謝賈斯汀，大家早安。讓我回顧一下我們第二季的業績。截至2024 年6 月30 日止三個月的總收入增至3,850 萬美元，較2023 年第二季的2,700 萬美元增加1,150 萬美元，增幅43%。 ，我們的收入為3,690 萬美元。

Rental revenue for Q2 2024 was $34.9 million, up from $24.1 million in Q2 2023 for a 45% increase year-over-year and up $1.2 million from $33.7 million in Q1, a 4% sequential increase. Our total adjusted gross margin of $21 million in the second quarter increased approximately 65% when compared to $12.8 million in the same period in 2023. Sequential adjusted gross margin dollars decreased 1% from $21.1 million last quarter.

2024 年第二季的租金收入為 3,490 萬美元，較 2023 年第二季的 2,410 萬美元增長 45%，較第一季的 3,370 萬美元增長 120 萬美元，季增 4%。第二季調整後毛利率總額為 2,100 萬美元，與 2023 年同期的 1,280 萬美元相比增長了約 65%。

Adjusted gross margin as a percent of sales for Q2 2024 was 54.6% versus 47.4% for Q2 2023, and 57.2% in Q1 2024. This material increase year over year in margin percent was driven primarily by increased rental adjusted gross margins driven by a combination of increased rented horsepower along with an increase in pricing from the previous year. The decrease from Q1 was driven by lower gross margins across the board in but primarily from lower rental adjusted gross margins in Q2 2024 as compared to Q1.

2024 年第二季調整後毛利率佔銷售額的百分比為54.6%，而2023 年第二季為47.4%，2024 年第一季為57.2%。調整後毛利率增加所致租賃馬力的增加以及價格較前一年的上漲。較第一季下降的原因是 2024 年第二季毛利率全面下降，但主要是由於與第一季相比，2024 年第二季租金調整後毛利率較低。

Our rental adjusted gross margin dollars increased year over year to $20.7 million for Q2 2024 from $12.8 million in Q2 2023, representing a 62% increase. Sequentially, rental adjusted gross margin dollars were essentially flat increasing by $78,000 from $20.6 million in Q1 2024.

我們的租金調整後毛利率年比從 2023 年第二季的 1,280 萬美元增至 2024 年第二季的 2,070 萬美元，增幅為 62%。隨後，租金調整後毛利率基本上持平，較 2024 年第一季的 2,060 萬美元增加了 78,000 美元。

Our rental adjusted gross margin as a percent of sales for Q2 2024 was 59.3% versus 52.9% for Q2 2023 and 61.1% in Q1 2024. As we mentioned on our last earnings call, our rental adjusted gross margins have been somewhat above historical levels for the previous two quarters. We stated that we expected these amounts to move in the direction of historical averages and we saw that somewhat in Q2 with rental adjusted gross margins moving from approximately 61% of revenue for the previous two quarters to 59% for the most recent quarter.

我們2024 年第二季的租金調整後毛利率佔銷售額的百分比為59.3%，而2023 年第二季為52.9%，2024 年第一季為61.1%。如同我們在上次財報電話會議上提到的，我們的租金調整後毛利率略高於歷史水準前兩季。我們表示，我們預計這些金額將朝著歷史平均水平的方向發展，我們在第二季度看到了這一點，租金調整後的毛利率從前兩個季度佔收入的約61% 上升到最近一個季度的59 %。

We expected this slight margin contraction and a movement towards historical averages. We will need to add incremental labor and overhead costs as we continue to grow. This, combined with natural variability of maintenance repair costs due lead to some fluctuation in rental margins. With that said, we now have three successful quarters of strong rental margins, and we are increasingly confident about the margin potential of our business as evidenced by the increase in our adjusted EBITDA guidance for 2024.

我們預計利潤率會略有收縮，並會朝歷史平均移動。隨著我們的不斷發展，我們將需要增加增量勞動力和管理費用。再加上維修成本的自然變化，導致租金利潤率出現一些波動。話雖如此，我們現在已經連續三個季度實現了強勁的租金利潤率，而且我們對我們業務的利潤率潛力越來越有信心，2024 年調整後 EBITDA 指導的增加就證明了這一點。

SG&A expense for Q2 2024 was $4.8 million or 12.4% of revenue versus $4.9 million or 18% of revenue in Q2 2023. SG&A expense was $4.7 million or 12.7% of revenue in Q1 2024. Factors leading to the increase in SG&A expense over Q1, include an increase in costs related to professional fees, specifically related to public company costs. Pretax operating income $8.5 million for Q2 2024 which was improved from approximately $700,000 in Q2 2023 and was down sequentially from $9.3 million in Q1.

2024 年第二季的SG&A 費用為480 萬美元，佔營收的12.4%，而2023 年第二季的SG&A 費用為490 萬美元，佔營收的18%。美元，佔營收的12.7%。 2024 年第二季稅前營業收入為 850 萬美元，較 2023 年第二季的約 70 萬美元有所改善，較第一季的 930 萬美元有所下降。

Net income in Q2 was $4.3 million compared to $504,000 in Q2 2023, down slightly from $5.1 million in Q1 2021. Earnings per share for Q2 2024 were $0.34 on both a basic and fully diluted basis compared to $0.04 per share for Q2 2023. And earnings of $0.41 per share for Q1 2024.

第二季淨利為430 萬美元，而2023 年第二季為504,000 美元，略低於2021 年第一季的510 萬美元。而2023 年第二季每股收益為0.04 美元。

Our second-quarter 2024 adjusted EBITDA was $16.5 million compared to $9.9 million in Q2 2023 or 67% increase year-over-year, with a 2% sequential decrease from $16.9 million in Q1 2024. Our adjusted EBITDA in Q2 was negatively impacted by lower rental adjusted gross margin percent compared to Q1 2024. In Q4 2023 and partially offset by a 4% growth in our rental revenue from Q1 2024.

我們的 2024 年第二季調整後 EBITDA 為 1,650 萬美元，而 2023 年第二季調整後 EBITDA 為 1,650 萬美元，而 2023 年第二季為 990 萬美元，年成長 67%，較 2024 年第一季的 1,690 萬美元季減 2%。一季度相比，租金調整後毛利率百分比。

At the end of Q2 2024, we had 1,242 rented units compared to 1,249 rented units as of June 30, 2023. In Q2 2024, rented units represented just under 455,000 horsepower compared to approximately 373,000 horsepower rented as of June 30, 2023. Our total fleet as of June 30, 2024, was 1,899 units consisting of 552,599 horsepower ending the quarter with a 65.4% utilization on a per unit basis and 82.3% utilization on a horsepower basis.

截至2024 年第二季末，我們擁有1,242 台租賃單位，而截至2023 年6 月30 日，我們擁有1,249 台租賃單位。 6 月30 日，租賃單位約為373,000 匹馬力。

Our average horsepower per unit as of June 30, 2024, was 291 horsepower per unit, up from 277 at year-end 2023 and 286 at the end of in 2024.

截至 2024 年 6 月 30 日，我們的平均每台馬力為 291 匹馬力，高於 2023 年底的 277 匹馬力和 2024 年底的 286 匹馬力。

Turning to the balance sheet. We ended the second quarter with $3.6 million in cash and $163 million outstanding on our amended and restated revolving credit facility. In looking at our key financial covenants contained in our credit agreement, our leverage ratio was 2.51 times, down just slightly from 2.57 times as of Q1. Our fixed charge coverage ratio for Q2 was 2.68 times. Thus, we were comfortably in compliance with both of our financial covenants as of June 30, 2024.

轉向資產負債表。第二季結束時，我們的現金為 360 萬美元，經修訂和重述的循環信貸額度未償還金額為 1.63 億美元。從我們的信貸協議中包含的主要財務契約來看，我們的槓桿率為 2.51 倍，略低於第一季的 2.57 倍。我們第二季的固定費用覆蓋率為 2.68 倍。因此，截至 2024 年 6 月 30 日，我們完全遵守了兩項財務契約。

Our accounts receivable balance at June 30, 2024, was $33 million, a $9.3 million decrease from Q1. On our last earnings call, we discussed the reasons why our receivables balance have become elevated from normal and expected levels. We stated at that time, we felt this was more of a timing issue and that there was no real concern about our customers' willingness to be.

截至 2024 年 6 月 30 日，我們的應收帳款餘額為 3,300 萬美元，比第一季減少 930 萬美元。在我們上次的財報電話會議上，我們討論了我們的應收帳款餘額高於正常和預期水準的原因。我們當時表示，我們認為這更多的是一個時間問題，並且並不真正擔心我們的客戶是否願意這樣做。

We're certainly pleased with the progress to date on accounts receivable but continue to believe we have more improvement to make, and that improvement is likely to take until the end of 2024 to fully achieve what we expect to be sustainable go-forward levels. The net book value of our rental fleet at quarter end was approximately $388 million.

我們當然對迄今為止在應收帳款方面取得的進展感到滿意，但仍然相信我們還有更多改進要做，而且這種改進可能需要到 2024 年底才能完全達到我們預期的可持續前進水平。截至季末，我們租賃機隊的帳面淨值約為 3.88 億美元。

We generated cash flow from operations of $31.1 million in the first half of 2024 compared to $22.6 million for the first half of 2023. The increase is primarily related to higher net income in 2024 along with the reduction of our accounts receivable balance as discussed earlier in the call. We had capital expenditures of approximately $28.2 million in the first half of the year, which can be broken out to $24.5 million of new unit growth CapEx and rental upgrades with the remaining $3.7 million being maintenance CapEx.

2024 年上半年，我們的營運現金流為 3,110 萬美元，而 2023 年上半年為 2,260 萬美元。電話。今年上半年，我們的資本支出約為 2,820 萬美元，其中可細分為 2,450 萬美元的新單位成長資本支出和租賃升級，其餘 370 萬美元則是維護資本支出。

We paid down the balance on our amended and restated credit facility by a net $1 million during the first half of 2024. With that, I will turn it over to Justin for some closing remarks.

我們在 2024 年上半年淨付清了修訂和重述的信貸額度餘額 100 萬美元。

Thanks, John. With respect to our 2024 guidance, our current outlook for 2024 adjusted EBITDA is $64 million to $68 million, which marks an increase from the prior guidance provided on our Q1 results call of $61 million to $67 million. We have moved our range up based on our results through the first half of the year and our confidence in the margin generating potential of our rented compressor units.

謝謝，約翰。關於我們的2024 年指導，我們目前對2024 年調整後EBITDA 的預期為6400 萬美元至6800 萬美元，這標誌著我們在第一季業績電話會議上提供的先前指導6100 萬美元至6700 萬美元有所增加。根據上半年的業績以及我們對租賃壓縮機組的利潤創造潛力的信心，我們提高了產品範圍。

We are mindful of costs looking to improve efficiencies, lowering non-core expenses where we can and reallocating cash to growth and cash flow generating initiatives. With that said, there are some incremental investments that are necessary as it relates to improving scalability and efficiency of our operations in addition to making sure we have the best people in the industry.

我們專注於成本，希望提高效率，盡可能降低非核心支出，並將現金重新分配給成長和現金流產生計畫。話雖如此，一些增量投資是必要的，因為除了確保我們擁有業內最優秀的人才之外，這還關係到提高我們營運的可擴展性和效率。

With respect to growth capital expenditures, we expect to spend between $60 million to $80 million in 2024, reflecting investments in new large horsepower compression units. As noted in our release, the wider range is primarily due to the fact that the contracts were just awarded, and we are still working on the exact timing in terms of what will hit in Q4 '24 versus early next year.

關於成長資本支出，我們預計 2024 年將支出 6,000 萬至 8,000 萬美元，反映對新大馬力壓縮機組的投資。正如我們在新聞稿中指出的，範圍擴大主要是因為合約剛剛授予，我們仍在研究 24 年第四季與明年初的具體時間。

At the midpoint of our range, assuming $70 million, we would currently expect 2025 growth CapEx to increase by roughly a third over 2024. To the extent that 2024 is at the lower or higher end of the range, we would expect 2025 growth CapEx to adjust accordingly. This is a similar issue we faced in 2023 and 2024. While we are not providing 2025 guidance, we wanted the investment community to have a rough sense of the growth opportunities we currently have signed.

在我們範圍的中點，假設為7000 萬美元，我們目前預計2025 年的成長資本支出將比2024 年增加約三分之一。資本支出為進行相應調整。這是我們在 2023 年和 2024 年面臨的類似問題。

As we move further into the year, we will update 2024 CapEx projections accordingly. It is our expectation that all the units related to these new contracts will be set in the field in 2025. Our outlook for 2024 maintenance CapEx remains unchanged at $8 million to $11 million with the majority of the expenditures related to our rental compression units with smaller amounts for field equipment, including trucks and other equipment.

隨著今年的臨近，我們將相應更新 2024 年資本支出預測。我們預計，與這些新合約相關的所有裝置均將於2025 年投入使用。裝置有關。

In terms of return on invested capital, our 2024 target remains at least 20%. In closing, we are taking advantage of the tight compression market, our industry-leading technology and our strong customer relationships. We believe we are growing faster than our peers, certainly the public ones, and we are well positioned to capture an increasing share of the large horsepower compression market, including in the large horsepower electric market.

在投資資本報酬率方面，我們2024年的目標仍然是至少20%。最後，我們正在利用緊張的壓縮市場、領先業界的技術和強大的客戶關係。我們相信，我們的成長速度比同行（尤其是公共同行）更快，而且我們處於有利地位，可以在大馬力壓縮市場（包括大馬力電動市場）中佔據越來越大的份額。

We are profitable and continue to generate higher net cash from operating activities to reinvest in our business. Our balance sheet remains strong, and our expanded credit facility provides us the flexibility to capture high-return growth. We are executing on our strategy to drive cash flow and earnings while never losing sight on increasing both near- and long-term shareholder value. Considering the many opportunities on the horizon, I'm quite excited about what NGS can achieve in the coming years.

我們已實現盈利，並繼續從經營活動中產生更多的淨現金，用於對我們的業務進行再投資。我們的資產負債表依然強勁，擴大的信貸額度為我們提供了實現高回報成長的靈活性。我們正在執行推動現金流和收益的策略，同時永遠不會忽視增加近期和長期股東價值。考慮到即將出現的許多機會，我對 NGS 在未來幾年能夠取得的成就感到非常興奮。

This concludes our prepared remarks. So I'll ask the operator to queue up for the question-and-answer portion of our call. Luke, please go ahead.

我們準備好的演講到此結束。因此，我會要求接線員排隊等候我們通話的問答部分。盧克，請繼續。

(Operator Instructions) Mr. Rob Brown, Lake Street Capital.

（操作員說明）Lake Street Capital 的 Rob Brown 先生。

Congratulations on all the progress. Just want to get a little bit into the new contracts and the demand environment. I think you talked about a pretty good pipeline into '25, and I guess the CapEx discussion implies that. But how is the demand environment? And maybe just characterize kind of what you're seeing and when you start to see the next cadence of new contracts.

祝賀所有的進展。只是想了解新合約和需求環境。我認為您談到了 25 年的一個相當好的管道，我想資本支出的討論暗示了這一點。但需求環境如何？也許只是描述一下您所看到的情況以及您何時開始看到新合約的下一個節奏。

Well, we just announced a bunch of them. So we're certainly focused on those right now, and we're going to have significant activity in the second half in 2024 and throughout 2025. So I think I could characterize overall that it is a robust environment in terms of demand for compression. And so we are going to have a very busy time in terms of getting all of these new units set.

好吧，我們剛剛宣布了其中的一些。所以我們現在肯定會關注這些，我們將在 2024 年下半年和整個 2025 年開展重大活動。因此，我們將度過一段非常忙碌的時間來設置所有這些新單位。

Obviously, we had a bunch that are still coming on in the second half of '24 and into now 2025 is going to be a very active period in terms of getting new units out into the field. In terms of beyond that, we're already having and have been having conversations with customers for 2025 and 2026. And so that is kind of next on the docket, but overall, it's an active environment.

顯然，我們有很多在 24 年下半年仍在進行中，而到了 2025 年，在將新設備投入使用方面將是一個非常活躍的時期。除此之外，我們已經並一直在與客戶進行 2025 年和 2026 年的對話。

Okay. Great. And I wasn't minimizing the new contracts you signed, so congratulations on those. I did want to ask about those. I think you said 40% or electric drive. How is that market developing? And I guess, what's the what's sort of the comparison in that market of the rental rates and I guess the margins of that product line?

好的。偉大的。我並沒有最小化你簽署的新合同，所以恭喜你。我確實想問那些。我想你說的是 40% 或電力驅動。這個市場發展得怎麼樣？我想，該市場的租金率和該產品線的利潤率有何比較？

I would call them just generally comparable. There are some differences in a number of different areas. But overall, I would think of them as generally similar. In terms of the market, I think there has been a significant increase in demand for electric over the last several years. And then there is also a constraint -- a practical constraint is there power at the particular site to power these large machines.

我認為它們只是總體上具有可比性。許多不同領域存在一些差異。但總的來說，我認為它們總體上是相似的。就市場而言，我認為過去幾年對電力的需求顯著增加。然後還有一個限制——一個實際的限制是特定地點是否有電力為這些大型機器供電。

And the answer is, in some cases, yes, and in some cases, no. And our perspective is one of flexibility in being able to offer our customers whatever they need. They need natural gas, and in fact, what they want at their particular site or do they want electric.

答案是，在某些情況下是的，在某些情況下則不是。我們的觀點之一是能夠靈活地為客戶提供他們需要的任何東西。他們需要天然氣，事實上，他們需要在特定地點使用天然氣或電力。

And so in that way, we really want to let the market decide that as the grid increases in terms of power that's provided, and that's a reasonably uncertain exercise to understand at this point, we'll let our customers tell us what they want, and we have the flexibility to be able to provide it for them.

因此，透過這種方式，我們真的希望讓市場決定，隨著電網提供的電力增加，這是一個相當不確定的練習，我們將讓我們的客戶告訴我們他們想要什麼，我們可以靈活地為他們提供服務。

Mr. Jim Ardissono, Raymond James.

吉姆·阿迪索諾先生，雷蒙德·詹姆斯。

Justin, maybe you started talking with the new contracts and just reference the fact that rates on those are higher than where your kind of fleet average is today. Maybe just a little sense of magnitude so we can kind of think about where the shift is headed here over the next several quarters as those new contracts roll in? Just trying to understand that kind of delta there, if you don't mind.

賈斯汀，也許您開始談論新合約時只是提到了這樣一個事實：這些合約的費率高於您目前的機隊平均值。也許只是一點點規模感，這樣我們就可以思考一下，隨著這些新合約的到來，未來幾季的轉變將走向何方？如果你不介意的話，只是想了解那裡的那種三角洲。

Sure. I mean, I'm not going to get into specifics on pricing. I wanted to indicate that it is above the average for the fleet to show that it is overall a good pricing environment, particularly for new equipment, if you have it available. And that it is, I think, supportive of the fact that -- these new units are going to be above our target return on invested capital. And so they're above -- I'm not at a point where I want to quantify that amount, but they are above.

當然。我的意思是，我不會詳細討論定價問題。我想指出的是，它高於機隊的平均水平，以表明總體上這是一個良好的定價環境，特別是對於新設備（如果有的話）。我認為，這支持了這樣一個事實：這些新單位將高於我們的投資資本目標回報率。所以它們高於——我不想量化這個數額，但它們高於。

Got it. And when I look at the range now of growth CapEx this year and you kind of alluded to where 25 million is headed from there. Just maybe a little bit of color on how much incremental horsepower that would equate to?

知道了。當我查看今年資本支出的成長範圍時，您提到了 2500 萬美元的未來方向。也許只是稍微說明一下這相當於多少增量馬力？

We haven't disclosed the horsepower amount. I would say that the cost of building this horsepower is generally in line with what's out there in the market. A significant percentage of this is fabricated externally just because of the size we're doing that with partners at this point. And it's not a number that we've disclosed in terms of forward-looking, although if you look at the horsepower we've added over the last one to two years, it's generally going to be in line with those price levels.

我們還沒有透露馬力的大小。我想說的是，製造這種馬力的成本通常與市場上的成本一致。其中很大一部分是外部製造的，只是因為我們目前與合作夥伴一起做的規模很大。這不是我們在前瞻性方面披露的數字，儘管如果你看看我們在過去一到兩年中增加的馬力，它通常會與這些價格水平一致。

Got it. Appreciate that. And maybe just one last one on kind of your cash initiatives between DSOs, which you made really nice progress on this quarter and some of the other things you're doing. You mentioned the time line could be out to 24 months, but curious if you have any visibility on some of these items just here over the next handful of quarters?

知道了。很欣賞這一點。也許只是最後一個關於 DSO 之間的現金計劃的內容，您在本季度以及您正在做的其他一些事情上取得了非常好的進展。您提到時間軸可能長達 24 個月，但想知道您在接下來的幾個季度中是否對其中一些項目有任何了解？

Sure. There are a couple of buckets and time frames. Certainly, we've shown good progress on the accounts receivable front, and that is something that's a little bit more in our control, and I'm happy the way we've executed against that and continue to believe we will execute further on that. As John mentioned, it's something to get within kind of historical levels is by year end.

當然。有幾個時間段和時間範圍。當然，我們在應收帳款方面取得了良好的進展，這是我們更能控制的事情，我很高興我們在這方面的執行方式，並繼續相信我們將在這方面進一步執行。正如約翰所提到的，到年底，這將達到歷史水平。

And certainly, in the recent past, we've been well above historical levels, but we want to return back to that. The income tax receivable, we are making progress against, but we're dealing with a government agency there. And so at the end of the day, we are somewhat at their -- if not significantly at their mercy, but we believe it is -- we will receive that. And it's just a question of timing, and we're doing everything on our side that we can to accelerate that.

當然，在最近的過去，我們的水平遠高於歷史水平，但我們希望回到這個水平。我們正在應收所得稅方面取得進展，但我們正在與那裡的政府機構打交道。因此，歸根結底，我們在某種程度上受到了他們的擺佈——即使不是很大程度地受到他們的擺佈，但我們相信——我們會接受的。這只是一個時間問題，我們正在盡一切努力加速這一進程。

When it comes to the owned real estate, practically, that's just a little bit longer term. And I think that is probably more towards the range I gave up to 24 months. Certainly, we hope to make progress more quickly, but it just does take some time with some real estate, and there's some significant value there. And so it's something we're focused on. I think just the timing is a little longer.

實際上，當談到自有房地產時，這只是一個更長的期限。我認為這可能更接近我給出的 24 個月的範圍。當然，我們希望取得更快的進展，但在一些房地產方面確實需要一些時間，而且那裡有一些重要的價值。所以這是我們關注的重點。我覺得只是時間長一點而已。

Tate Sullivan, Maxim Group.

泰特·沙利文，馬克西姆集團。

Can you talk about the procurement of the engines themselves? Is it a longer process than a couple of months ago? And is that part of your competitive advantage access to different kinds of engines than the competitors.

能談談引擎本身的採購嗎？與幾個月前相比，這個過程是否更長？您的競爭優勢的一部分是獲得比競爭對手不同類型的引擎。

I think that the procurement time frame, it certainly isn't longer than it was over the past year or so and generally trending probably a little bit better but it's still a long lead time item, and it's not the only long lead time item. They're really kind of three longer lead time general items, which are the engine, the compressor frame and then getting space with a fabricator to have it done. And those are all still slightly less than they were two years ago, but it's still a long lead item.

我認為採購時間框架肯定不會比過去一年左右的時間長，而且總體趨勢可能會好一點，但它仍然是一個長交貨時間的項目，而且它不是唯一一個長交貨時間的項目。它們實際上是三個交貨時間較長的一般項目，即發動機、壓縮機框架，然後與製造商一起獲得空間來完成它。這些仍然比兩年前略少，但它仍然是一個長期領先的項目。

And so that leads to some of the just uncertainty on exact timing of CapEx spend between '24 and '25 of we're roughly six months to the end of the year as we were looking at these contracts and saying how much is going to fall in Q4 and Q1, but an expectation that they will all be set by the end of 2025. And so I think it is still a reasonably long lead time, but probably a little better than it was before.

因此，這導致了 24 年至 25 年間資本支出的確切時間存在一些不確定性，距離年底大約還有六個月，因為我們正在研究這些合約並確定將下降多少在第四季度和第一季度，但預計它們將在2025 年底之前全部確定。

And related to your comments about industry-leading technology. Is that related to more of the natural gas engines or what -- can you talk about what you're referring to?

並與您對行業領先技術的評論相關。這與更多的天然氣引擎有關還是什麼——你能談談你指的是什麼嗎？

I think that those are the units overall. There are a couple of key items that I would point to in terms of the run times of our units is not the mechanical availability, but the actual run time that the customer sees due to our smart technology is quite strong, and we've received a lot of favorable feedback from customers that, that delivers productivity to them and that's important from a service level and ultimately profitability perspective on there. And so that's one component of it.

我認為這些是整體的單位。在我們設備的運行時間方面，我要指出的幾個關鍵項目不是機械可用性，而是客戶由於我們的智能技術而看到的實際運行時間非常強大，並且我們已經收到了來自客戶的許多積極反饋，這為他們提高了生產力，從服務水準和最終獲利的角度來看，這很重要。這就是其中的一個組成部分。

And the second major component, which relates to engines, but also some of the technology that we put on to the units is reducing emissions, and that is an increasingly important characteristic or need for the producers. And so those are certainly two of the big ones, not the only ones, but two of the larger drivers of the technology of the units where we're getting very favorable responses from customers.

第二個主要組成部分與引擎有關，但我們在設備上採用的一些技術正在減少排放，這對生產商來說是一個越來越重要的特徵或需求。因此，這肯定是兩個重要的因素，不是唯一的因素，而是我們從客戶那裡得到非常有利的反應的單位技術的兩個更大的驅動因素。

And last, do you already have electric motor horsepower in the field or not?

最後，您是否已經在現場擁有電動馬達馬力？

We do.

我們做到了。

Oh, you do. Okay.

哦，你知道。好的。

Yes, we do.

是的，我們願意。

Okay. And I assume the service related to those, is it much less compared to the natural gas engine components are not necessarily.

好的。我認為與這些相關的服務與天然氣引擎組件相比是否少得多，不一定。

It is lower just because you have some lower levels of maintenance in that you got dealing with an electric motor versus an engine fewer moving parts, requires some less maintenance but it is an area that we have significant experience going all the way back to fabricating these years ago. So it's an area that we have a good bit of experience from.

它之所以較低，只是因為你的維護水平較低，因為與發動機相比，你處理的電動機更少的運動部件，需要更少的維護，但這是一個我們在製造這些產品方面擁有豐富經驗的領域。因此，我們在這個領域擁有豐富的經驗。

Selman Akyol, Stifel.

塞爾曼·阿克奧爾，史蒂菲爾。

A couple of quick ones for me. So you talked, I think, about 40% of your delivery is going to be electric drive and you guided a little bit towards 2025. Would you expect that percentage to move meaningfully one way or the other as you look into 2025 and beyond?

對我來說有幾個快速的。因此，我認為您談到，大約40% 的交付將是電力驅動，並且您對2025 年進行了一些指導。地變化？

Just to confirm your question is will the electric percentage differ much in 2025?

只是為了確認你的問題，2025 年電力百分比會相差很大嗎？

Correct.

正確的。

I would say, remainder of '24 and '25 on the new contracts, that's looking overall that 40%.

我想說，新合約的 24 年和 25 年剩餘時間，整體看來是 40%。

Got it. And then is something changing out there because -- I mean, especially for large horsepower, right? It's just not electric, but it's large electric. Is there something your customers are seeing that's given them confidence to go that way? Because we have been hearing that that's still kind of a huge stumbling block?

知道了。然後，事情發生了變化，因為——我的意思是，特別是對於大馬力，對嗎？它只是不是電動的，但它是大型電動。您的客戶看到的某些東西是否讓他們有信心這樣做？因為我們聽說這仍然是一個巨大的絆腳石？

I think it was -- I would say, generally, it's been the last several years that we've seen increasing although somewhat uneven interest in the large horsepower. I think there is an attractiveness from the operator's perspective in certainly, the emission side as it relates to the compressor units and potentially some on the run time just with less maintenance, but that's assuming that there is -- that one power exists at that particular site, and then two, that it is consistent power.

我認為，總的來說，在過去的幾年裡，我們看到人們對大馬力的興趣增加，儘管有些不平衡。我認為從操作員的角度來看，排放方面當然具有吸引力，因為它與壓縮機組有關，並且可能在運行時只需較少維護，但這是假設存在 - 在特定的情況下存在一種功率現場，然後兩個，那就是動力一致。

And that is, I think, really the -- a material restriction in terms of the potential penetration on compression overall and specifically large horsepower and there's a fair bit of uncertainty around that. The customers are uncertain as to will they have power for instances of -- they thought they would. And then suddenly, they didn't and they'd already planned to put electric horsepower there.

我認為，這確實是對整體壓縮的潛在滲透性和特別是大馬力的實質限制，並且存在相當大的不確定性。客戶不確定他們是否會擁有權力——他們認為他們會擁有權力。然後突然間，他們沒有這麼做，他們已經計劃在那裡安裝電動馬力了。

And so I think the power supply and consistency is really the big question mark. And that's kind of an unknown, which is one of the reasons that we want to take a an approach that is either or it's whatever the customer wants there, we can supply either. And so I think there's significant interest. I think it will continue to increase over some long period of time, but it's going to be uneven.

所以我認為電源和一致性確實是一個大問號。這是一種未知數，這就是我們想要採取一種方法的原因之一，或者是客戶想要的任何東西，我們都可以提供。所以我認為人們對此很感興趣。我認為在很長一段時間內它會繼續增加，但不平衡。

Got it. And I know you focus on the Permian, we always talk about the Permian, but are you guys seeing demand in any other basins out there?

知道了。我知道你們關註二疊紀，我們總是談論二疊紀，但是你們看到其他盆地的需求了嗎？

I would say that the Permian is certainly the most robust. And for us, with it around 75% of our business, the area that we focus most we are seeing, certainly in other basins that are more oil driven. We're continuing to see demand. It's just on a relative basis for size for us, it's just smaller, but it doesn't mean it's not there.

我想說二疊紀肯定是最強的。對我們來說，它占我們業務的 75% 左右，這是我們最關注的領域，當然在其他更多石油驅動的盆地。我們繼續看到需求。對我們來說，它只是相對大小而言，它只是更小，但這並不意味著它不存在。

Got it. And then last one for me. Can you just touch on your outlook for acquisitions?

知道了。然後是我的最後一張。您能談談您對收購的展望嗎？

It's an ongoing process. I think it is an opportunity for us but it's not one that we have to do for our shareholders to see, I believe, very good returns. And so I think I look at it that way. It's an ongoing set of discussions with potential acquisitions, whether entire companies or portions of fleets, but it's not one that I feel that we are pressured to do.

這是一個持續的過程。我認為這對我們來說是一個機會，但我相信，這不是我們必須為股東看到非常好的回報而做的機會。所以我想我是這樣看的。這是一系列與潛在收購（無論是整個公司還是部分機隊）的持續討論，但我認為我們沒有壓力這樣做。

We are in an advantageous position to I think there is strategic logic to it, but we'll remain disciplined on the composition of the fleets that we're looking at, the customer mix, the base and obviously valuation. And so it will be an ongoing process, of which we'll continue to look at, and we'll pull the trigger if we see something that we think makes sense for shareholders.

我們處於有利地位，我認為這是有戰略邏輯的，但我們將在我們正在考慮的機隊組成、客戶組合、基礎和明顯估值方面保持紀律。因此，這將是一個持續的過程，我們將繼續關注，如果我們看到我們認為對股東有意義的事情，我們將扣動扳機。

In terms of just acquisitions, not thinking so much about another compression company, but just thinking about do you have customers who may be looking to sell units from basins that either are not working out as well as maybe originally thought?

就收購而言，不要過多考慮另一家壓縮公司，而只是考慮是否有客戶可能希望出售來自盆地的設備，而這些盆地的效果並不像最初想像的那麼好？

I'm sorry, Selman can you just repeat the question? I'm not sure I heard that right.

抱歉，塞爾曼，你能重複這個問題嗎？我不確定我沒聽錯。

Yes. Yes. Let me phrase it better. So are there any packages from your customers that you could potentially acquire from them where either their basin is not spooling up as fast as they thought or less of an emphasis. So is there any opportunity to buy compressor packages from your customers?

是的。是的。讓我更好地表述一下。那麼，您是否有可能從客戶那裡獲得的任何包裹，其中要么他們的盆沒有像他們想像的那麼快，要么不太受重視。那麼是否有機會向您的客戶購買壓縮機組呢？

I see from the customers. I missed that part, sorry. We've seen it, although that's not I wouldn't describe that as a material portion of where we would -- where we are spending our time in M&A. If that becomes a larger opportunity, it's something that we'll certainly look at, but it's not a big part of it today.

我從顧客那裡看到的。我錯過了那部分，抱歉。我們已經看到了這一點，儘管那不是，但我不會將其描述為我們將在併購中花費時間的重要部分。如果這成為一個更大的機會，我們肯定會關注它，但今天它並不是其中的重要組成部分。

(Operator Instructions) I don't see any other questions. Go ahead, please.

（操作員說明）我沒有看到其他問題。請繼續。

Thank you, Luke, and thanks for all of your questions and participation on the call. We sincerely appreciate your support. I want to thank all of our employees who delivered these results for our shareholders. I also want to thank our customers for trusting us with their business. We look forward to updating you on our progress in the next quarter. Thank you, everyone, and we're done with the call.

謝謝盧克，感謝您在電話會議中提出的所有問題和參與。我們衷心感謝您的支持。我要感謝所有為股東帶來這些成果的員工。我還要感謝我們的客戶對我們業務的信任。我們期待向您通報下一季的最新進展。謝謝大家，我們的通話結束了。

This concludes today's conference call. Thank you, everyone, for attending.

今天的電話會議到此結束。謝謝大家的出席。