Tetra Technologies Inc (TTI) 2025 Q1 法說會逐字稿

Good morning, everybody, and thank you for joining Tetra's first quarter of 2025 results conference call. I'm Kurt Hallead, VP, Treasurer and head of IR.

大家早安，謝謝您參加 Tetra 2025 年第一季業績電話會議。我是副總裁、財務長兼投資者關係主管 Kurt Hallead。

The speakers for today's call are Brady Murphy, Chief Executive Officer, and Elijio Serrano, Chief Financial Officer. I'd like to remind you that this conference may contain statements that are may deemed to be forward-looking, including projections, financial guidance, profitability, and estimated earnings.

今天電話會議的發言人是執行長布雷迪墨菲 (Brady Murphy) 和財務長埃利吉奧塞拉諾 (Elijio Serrano)。我想提醒您，本次會議可能包含被視為前瞻性的聲明，包括預測、財務指導、獲利能力和預計收益。

These statements are based on certain assumptions and analysis made by Tetra and are based on several factors. These statements are subject to several risks and uncertainties, many of which are beyond the control of the company. You're cautioned that such statements are not guarantees of future performance and that actual results may differ materially from those projected in the forward-looking statements.

這些聲明是基於 Tetra 所做的某些假設和分析，並基於多種因素。這些聲明受到多種風險和不確定性的影響，其中許多超出了公司的控制範圍。請注意，此類聲明並非對未來業績的保證，實際結果可能與前瞻性聲明中預測的結果有重大差異。

In addition, in the course of the call, we may refer to EBITDA, adjusted EBITDA, adjusted EBITDA margins, free cash flow, net debt, net leverage ratio, liquidity, returns on net capital employed, or other non-GAAP financial measures. Please refer to yesterday's press release or to our public website for reconciliation of non-GAAP financial measures to the nearest GAAP measures.

此外，在電話會議過程中，我們可能會參考 EBITDA、調整後的 EBITDA、調整後的 EBITDA 利潤率、自由現金流、淨債務、淨槓桿率、流動性、淨資本使用回報率或其他非 GAAP 財務指標。請參閱昨天的新聞稿或造訪我們的公開網站，以了解非公認會計準則財務指標與最接近的公認會計準則指標的對帳。

These reconciliations are not a substitute for financial information prepared in accordance with GAAP and should be considered within the context of our complete financial results for the period. In addition to our press release announcement, we encourage you to refer to our 10Q that we also filed yesterday. I will now turn it over to Brady.

這些對帳不能取代根據 GAAP 編制的財務信息，應結合我們該期間的完整財務結果進行考慮。除了我們的新聞稿公告外，我們還鼓勵您參考我們昨天提交的 10Q。現在我將把麥克風交給布雷迪。

Thanks, Kurt. Good morning, everyone and welcome to Tetra's first quarter of 2025 earnings call. I'll summarize some highlights for the first quarter and provide an update on our strategic growth initiatives before turning the call over to Elijio to provide some more details on our segments and an update on cash flow on our balance sheet.

謝謝，庫爾特。大家早安，歡迎參加 Tetra 2025 年第一季財報電話會議。我將總結第一季度的一些亮點並提供我們戰略增長計劃的最新情況，然後將電話轉給 Elijio，以提供有關我們各部門的更多詳細信息以及資產負債表上現金流的最新情況。

We're very pleased with our record first quarter adjusted EBITDA of $32.3 million and adjusted EBITDA margins of 20.5% at the Tetra level, led by strong performance from our completion fluids and product segment.

我們對第一季創紀錄的 3,230 萬美元調整後 EBITDA 和 Tetra 水準 20.5% 的調整後 EBITDA 利潤率感到非常滿意，這得益於我們完井液和產品部門的強勁表現。

Total revenue of $157 million increased 17% sequentially and 4% from last year, while adjusted EBITDA of $32.3 million increased 41% sequentially and also when compared to last year. During the quarter, we successfully completed the first of the three scheduled Tetra CS Neptune wells and made significant progress on the second well, which was subsequently completed in April.

總營收為 1.57 億美元，季增 17%，比去年成長 4%，調整後的 EBITDA 為 3,230 萬美元，較上季成長 41%，與去年相比也成長。本季度，我們成功完成了 Tetra CS Neptune 計劃開採的三口井中的第一口，並在第二口井上取得了重大進展，該井於 4 月完工。

Year over year we saw a 60% increase in offshore deep water operations, having worked on 24 deepwater projects during the quarter compared to 15 in the first quarter of 2024.

與去年同期相比，我們的海上深水作業成長了 60%，本季度我們開展了 24 個深水項目，而 2024 年第一季為 15 個。

This is consistent with what we have been seeing for some time that the deepwater market has been gaining momentum since the 2021 post-COVID pandemic low point for deepwater rig activity. The nature of these large higher pressure deepwater jobs can make our business somewhat lumpier depending on the timing of well completions, but the year over year deep water trend is a steady increase.

這與我們一段時間以來看到的情況一致，即自 2021 年新冠疫情後深水鑽井平台活動處於低谷以來，深水市場一直在增長勢頭。這些大型高壓深水作業的性質可能會使我們的業務根據井完井時間而變得有些不穩定，但逐年深水趨勢呈現穩定成長。

As a result of the stronger deepwater activity and the start of the seasonally strong industrial chemicals business in Northern Europe, completion fluids and products adjust the EBITDA margins increased to 35.7% from 27.3% in the fourth quarter. Revenue for water and flow back services segment declined 2% sequentially, outperforming US frac activity that declined approximately 10%.

由於深水活動的加強和北歐季節性工業化學品業務的開始，完井液和產品調整後的 EBITDA 利潤率從第四季度的 27.3% 上升至 35.7%。水和回流服務部門的營收季減 2%，表現優於美國壓裂活動約 10% 的降幅。

The margins on water and flow of 13% were down slightly from the fourth quarter, but up 340 basis points from Q4 last year despite much lower frac activity levels as cost control actions and continued focus on automation contributed to improved year on year margins in a weaker environment.

水和流量的利潤率為 13%，較第四季略有下降，但比去年第四季上漲了 340 個基點，儘管壓裂活動水平低得多，但成本控制措施和對自動化的持續關注在較弱的環境下促進了利潤率同比上升。

In anticipation of weaker US land activity at current oil prices, we are taking cost actions within this segment, including exit of the poly pipe business, a small lower margin subsegment of our water transfer business. As we head into the second quarter, an encouraging aspect of the water and flowback segment is that our automated sandstorm and automated drill out units are operating at close to 100% utilization.

由於預計在當前油價下美國陸地活動將會減弱，我們正在對該部門採取成本行動，包括退出聚乙烯管道業務，這是我們輸水業務中利潤率較低的一個小部門。進入第二季度，水和回流部分的一個令人鼓舞的方面是，我們的自動沙塵暴和自動鑽出裝置的利用率接近 100%。

This is strong validation that our customers see the operational benefit and cost savings of less manpower to operate what are typically manpower intensive jobs. In this business environment, we will be reducing our overall CapEx for the water and flow back segment, but only, but with only 25% of our fleet automated, we will be prioritizing our CapEx to further automate our fleet.

這有力地證明了我們的客戶看到了透過減少人力來完成通常需要大量人力的工作所帶來的營運效益和成本節約。在這種商業環境下，我們將減少水和回流部分的整體資本支出，但由於我們只有 25% 的船隊實現了自動化，我們將優先考慮資本支出以進一步實現船隊的自動化。

Looking towards the second quarter, we expect to see the full benefit of our European industrial chemicals seasonal peak, the first well from our recently awarded multi-well, multi-year deepwater Brazil project and expect to complete the last well of the three wells CS Neptune project in the Gulf of Mexico.

展望第二季度，我們預計將充分受益於歐洲工業化學品季節性高峰、我們最近授予的多井、多年期深水巴西項目中的第一口井，並預計將完成墨西哥灣三口井 CS Neptune 項目中的最後一口井。

We continue to track a healthy pipeline of CS Neptune projects across the globe but given the significance of these projects that have on our financials, we will wait until a project is awarded with a defined date before making any announcements.

我們將繼續追蹤全球 CS Neptune 專案的健康發展，但考慮到這些專案對我們財務的重要性，我們將等到專案在確定日期授予後再發布任何公告。

With regards to tariffs, both segments within Tetra have a high percentage of products and raw materials sourced from within the US, so we don't expect much, if any, financial impact from tariffs. However, the current oil price environment does create more uncertainty for US land activity than previously anticipated.

關於關稅，Tetra 旗下兩個部門都有很大比例的產品和原料來自美國境內，因此我們預期關稅不會產生太大的財務影響。然而，目前的油價環境確實為美國陸地活動帶來了比之前預期更多的不確定性。

As we've demonstrated in the past, we will be monitoring activity levels and our customer plans very closely to respond accordingly. Given our record first quarter performance and strong second quarter outlook, we have moved up the lower end of our previously communicated first half 2025 adjusted the guidance to now be between $57 million and $0.65 million. It was previously $55 million to $65 million.

正如我們過去所展示的那樣，我們將密切監控活動水平和客戶計劃，並做出相應的反應。鑑於我們第一季創紀錄的業績和強勁的第二季前景，我們已將先前公佈的 2025 年上半年調整後指引的下限上調至 5,700 萬美元至 65 萬美元之間。此前該數字為 5500 萬至 6500 萬美元。

Attainment of the adjusted even guidance for the first half of the year would also be a record high for the company with Tetra's current business segments, which will be achieved despite the uncertain environment the industry is experiencing.

儘管產業環境充滿不確定性，但實現上半年調整後的預期利潤也將是 Tetra 現有業務部門所創下的歷史新高。

We generate strong free cash flow in the first quarter with a year over year free cash flow improvement of $41 million from the base business, including the benefit of the sale of our Kodiak shares. We have a strong free cash flow generating based business that should be able to navigate us through the near-term macro uncertainty and position the company to capitalize on its emerging growth opportunities for the coming years.

我們在第一季產生了強勁的自由現金流，基礎業務的自由現金流較上年同期增加了 4,100 萬美元，其中包括出售科迪亞克股份的收益。我們擁有強大的自由現金流產生業務，這應該能夠引導我們度過近期的宏觀不確定性，並使公司能夠利用未來幾年的新興成長機會。

Before turning over to Elijio to discuss more details on each of the segments, I'd like to highlight the progress that we have made with regards to our emerging growth initiatives. 2025 will be a key year for us to complete milestones that will allow us to quantify the financial benefits for each initiative.

在請 Elijio 討論每個部分的更多細節之前，我想強調一下我們在新興成長計畫方面的進展。 2025 年將是我們完成里程碑的關鍵一年，這將使我們能夠量化每項計劃的財務效益。

On the desalination of produced water side, with the announcement of our commercial launch of Tetra Oasis TDS and our collaboration with EOG Resources, we are very encouraged by our prospects for desalination of produced water for beneficial reuse. During the quarter, we announced a commercial pilot with EOG for a grassland study from Delaware Basin produced water.

在採出水淡化方面，隨著我們宣布商業推出 Tetra Oasis TDS 以及與 EOG Resources 的合作，我們對採出水淡化以實現有效再利用的前景感到非常鼓舞。本季度，我們宣布與 EOG 合作進行一項商業試點，對特拉華盆地產出水進行草地研究。

We continue to see growing momentum across the customer base and regulatory support for this much needed industry solution. Energy estimates that in the Permian Basin alone over 6.3 billion barrels of produced water are discharged into saltwater disposable wells per year that could be recycled and reused for agriculture or industrial purposes, including semiconductor chip manufacturing and data center cooling.

我們持續看到客戶群和監管機構對這一急需的行業解決方案的支援勢頭不斷增強。Energy 估計，光是在二疊紀盆地，每年就有超過 63 億桶採出水被排放到鹹水一次性井中，這些水可以回收再利用於農業或工業用途，包括半導體晶片製造和資料中心冷卻。

Such reuse will enable oil and gas operators to mitigate the risk associated with reducing disposal of poor space and the transport of produced water. Since our commercial launch of Oasis TDS, our customer and regulatory engagement has increased significantly, including visits to our research facility and commercial proposal discussions.

這種再利用將使石油和天然氣業者能夠減輕與減少劣質空間處置和採出水運輸相關的風險。自從我們將 Oasis TDS 商業化推出以來，我們的客戶和監管機構的參與度顯著提高，包括參觀我們的研究設施和商業提案討論。

There are several reports suggesting that with the current and projected rate of water injection occurring in the Permian Basin, that by 2030 or a few years after, there will not be available for space for water disposal injection. That is the reason why on April 21 of this year, the Wall Street Journal published an article calling this the Oil Patch's Manhattan Project.

有幾份報告表明，按照二疊紀盆地目前和預計的注水速度，到 2030 年或幾年後，將沒有可用於注水處理的空間。這就是為什麼今年4月21日《華爾街日報》發表文章稱此為「石油區的曼哈頓計畫」。

On the energy storage front, as the contracted strategic supplier of electrolyte products for Eos' Z3 utility energy storage systems, we're all positioned to benefit as Eos scales its manufacturing capabilities and delivers on its backlog.

在儲能方面，作為 Eos Z3 公用事業儲能係統電解質產品的簽約策略供應商，隨著 Eos 擴大其製造能力並完成其積壓訂單，我們都將從中受益。

We believe that the high purity characteristics of our pure flow zinc bromide, electrolyte, the flame-retardant characteristics, and mostly US, but 100% North American content makes it ideal for large scale utility use. We are encouraged by the progress of the US implementing their automated production lines that is expected to result in significant step changes in electronic volume requirements from Tetra.

我們相信，我們的純流溴化鋅、電解質的高純度特性、阻燃特性以及大部分美國製造（但 100% 北美成分）使其成為大規模公用事業使用的理想選擇。我們對美國實施自動化生產線的進展感到鼓舞，預計將導致 Tetra 的電子產品產量需求發生重大變化。

Regarding our Arkansas Evergreen brine production unit on April 24, we announced that the Arkansas Oil and Gas Commission, or approved our evergreen unit expansion, which will allow us to further optimize long-term bribe flow for bromine, future lithium, and other critical minerals extraction.

關於我們在 4 月 24 日的阿肯色州常青鹽水生產裝置，我們宣布阿肯色州石油和天然氣委員會批准了我們的常青裝置擴建，這將使我們能夠進一步優化溴、未來鋰和其他關鍵礦物提取的長期賄賂流。

We completed the drilling and sampling operations for our final test well on the evergreen unit that indicated good reservoir results. The Tetra well results also identified encouraging levels of magnesium and manganese, both of which are listed as US critical minerals that are largely supplied from countries outside the United States.

我們完成了常綠裝置上最後一口測試井的鑽探和取樣作業，結果顯示儲層結果良好。Tetra 油井的勘探結果也發現了令人鼓舞的鎂和錳含量，這兩種礦物都被列為美國關鍵礦物，主要由美國以外的國家供應。

We're continuing to advance the bromine project with critical milestone investments funded from our base business free cash flow. We're planning to commence drilling of the Evergreen unit's first of five planned production wells in the coming months while finalizing the plant engineering and plant site preparation for erecting the bromine tower later this year.

我們將繼續推進溴項目，並利用基礎業務自由現金流資助關鍵里程碑投資。我們計劃在未來幾個月內開始鑽探長榮裝置計畫中的五口生產井中的第一口，同時完成工廠工程和工廠場地準備工作，以便在今年稍後建造溴塔。

We are also encouraged that on April 22, 2025, the OGC approved SWA lithium's application to establish a unit for acreage under an option agreement between standard lithium, SWA lithium, and tetra.

我們也感到鼓舞的是，2025 年 4 月 22 日，OGC 批准了 SWA 鋰公司的申請，根據標準鋰、SWA 鋰和四鋰之間的選擇協議建立土地面積單位。

The option agreement compensates Tetra with a 2.5% royalty on gross revenues from the lithium that standard lithium produces from the tetra option acreage. In addition, Tetra maintains the ownership of the bromine and other mineral interests that will meet the planned phase two bromine plant production capacity.

該選擇權協議將向 Tetra 支付標準鋰從四價選擇權土地上生產的鋰的總收入的 2.5% 的特許權使用費作為補償。此外，Tetra 還保留了溴和其他礦產權益的所有權，以滿足計劃中的第二期溴工廠的生產能力。

To ensure clarity on our bromine project, it's important to understand that we are taking all the necessary steps, including long lead investments, to ultimately build the bromine processing facility. With our deep-water bromine fluids demand flourishing and Eos still in the early stages of ramping production. The business case for the bromine facility is still very much intact.

為了確保我們的溴項目清晰明了，重要的是要了解我們正在採取一切必要步驟，包括長期投資，以最終建造溴加工設施。隨著我們對深水溴液的需求不斷增長，Eos 仍處於提高產量的早期階段。溴設施的商業案例仍然非常完整。

We have also been clear that our intention is to fund the project from our base business cash flow without issuing expensive equity or increasing debt and overlevering Tetra at a time with uncertainty in the market.

我們也明確表示，我們的目的是透過基礎業務現金流為該項目提供資金，而不會在市場不確定的情況下發行昂貴的股權或增加債務並過度槓桿化 Tetra。

We are currently balancing long lead investments with bromine demand projections from Eos and our deep-water projects while reducing risks, including bridging supply agreements in the event that bromine demand outpaces our current outlook.

我們目前正在平衡長期投資與 Eos 和深水項目的溴需求預測，同時降低風險，包括在溴需求超過我們目前預期的情況下達成過渡供應協議。

Given these objectives, we have not yet set a final completion date for the plan. We remain of the opinion that this year our base business will generate in excess of $50 million free cash flow, so we are moving forward with planned investments likely between $40 million and $50 million on the project, advancing the engineering, putting in place the bromine tower, and bringing power requirements we need to the site.

鑑於這些目標，我們尚未確定該計劃的最終完成日期。我們仍然認為，今年我們的基礎業務將產生超過 5000 萬美元的自由現金流，因此我們將繼續推進計劃中的項目投資，預計投資額將在 4000 萬至 5000 萬美元之間，推進工程建設，安裝溴塔，並為現場提供我們所需的電力。

At the end of the year, we'll reassess next steps and timing of next investments and target a go live date with our project. Each of these initiatives represent a material financial benefit to the company that we will quantify as we complete key milestones for each throughout the year. Collectively they are transformational for the company.

年底，我們將重新評估下一步措施和下次投資的時間，並確定專案上線日期。每一項舉措都為公司帶來了實質的財務利益，我們將在全年完成每項舉措的關鍵里程碑時對這些利益進行量化。總的來說，它們對公司來說是一次變革。

Now I'll turn it over to Elijio to give more specifics on the segments and the balance sheet.

現在我將把話題交給 Elijio，讓他提供有關各個部門和資產負債表的更多細節。

Thank you, Brady, and good morning, everybody. Completion fluids and products segment first quarter revenue of $93 million. Increased 35% sequentially driven by a strong driven by strong activity. Adjusted EBITDA $33.2 million increased 77% sequentially. Representing I fall through of nearly 60%.

謝謝你，布雷迪，大家早安。完井液和產品部門第一季營收為 9,300 萬美元。在強勁活動的推動下，季增了 35%。調整後 EBITDA 為 3,320 萬美元，季增 77%。代表我失敗了將近60%。

Adjusted EBITDA margins of 35.7% compared to 27.3% in the fourth quarter of last year, reflecting the impact of Neptune and the stronger offshore market. Water and flowback services revenue of $64 million decreased 2% sequentially but was up 13% versus a year ago.

調整後的 EBITDA 利潤率為 35.7%，而去年第四季為 27.3%，反映了海王星和更強勁的離岸市場的影響。水和回流服務收入為 6,400 萬美元，季減 2%，但比去年同期成長 13%。

While adjusted EBITDA $8.3 million increased $1.2 million year on year. It's fourth quarter slowdown in the US onshore completion activity carried over into the first quarter. Adjusted even though margins were down only slightly from the fourth quarter as our focus on leveraging technology.

調整後的 EBITDA 為 830 萬美元，年增 120 萬美元。美國陸上完井活動第四季的放緩延續到了第一季。儘管利潤率與第四季度相比僅略有下降，但由於我們專注於利用技術，因此進行了調整。

And automation plus cost reductions to minimize the worker volumes are made an impact. First quarter adjusted free cash flow was $4.2 million of which $15.4 million was from the base business inclusive of $19 million proceeds from the sale of our investment in Kodiak.

自動化加上降低成本以最大程度減少工人數量會產生影響。第一季調整後的自由現金流為 420 萬美元，其中 1,540 萬美元來自基礎業務，包括出售我們在 Kodiak 的投資所得的 1,900 萬美元。

We got the timing right on when to monetize the Kodiak shares, selling them around $42 per share in early January. This morning, Kodiak was trading below $34 having dropped to as low as [$29.50]. Total capital expenditures in the first quarter were $18 million inclusive of $11 million associated with the expansion of our Arkansas roaming plant, addressing some of the areas Brady mentioned earlier.

我們選擇在適當的時機將科迪亞克股票貨幣化，在 1 月初以每股 42 美元左右的價格出售。今天早上，科迪亞克的交易價格跌破 34 美元，最低跌至[29.50美元]。第一季的總資本支出為 1800 萬美元，其中包括與擴建阿肯色州漫遊工廠相關的 1100 萬美元，解決了布雷迪之前提到的一些領域。

We expect working capital to come down materially in the second and third quarters as we monetize the Neptune receivable. And the calcium chloride inventory in northern Europe. As Brady mentioned, we remain of the opinion that free cash flow from the base business this year will be in excess of $50 million.

隨著我們將海王星應收帳款貨幣化，我們預計第二季和第三季的營運資金將大幅下降。以及北歐的氯化鈣庫存。正如布雷迪所提到的，我們仍然認為今年基礎業務的自由現金流將超過 5,000 萬美元。

We also further expect the free cash flow from the base that will fulfill our cash flow requirements for Arkansas this year, and we will not need to draw on a revolver or use the delayed draw feature from our term loan in 2025.

我們也進一步預計，基地的自由現金流將滿足我們今年對阿肯色州的現金流需求，我們將不需要動用循環信貸或使用 2025 年定期貸款的延期提款功能。

This is consistent with our plans of self-funding as much as possible of our capital requirements for the roaming project. We're moving methodically in advancing our brooming plant. Liquidity is at the end of this week was approximately $219 million.

這與我們盡可能自籌資金滿足漫遊計畫資金需求的計畫一致。我們正在有條不紊地推進我們的掃帚工廠。本週末的流動性約為 2.19 億美元。

Inclusive of the $75 million dollar delayed drop page is available for the roaming project. At the end of the first quarter, our net leverage ratio improved to 1.5 times from 1.8 times at the end of the year. If we see a slowdown in the onshore business, we know how to manage in such an environment.

其中包括為漫遊項目提供的 7,500 萬美元延遲投放頁面。第一季末，我們的淨槓桿比率由年底的1.8倍改善至1.5倍。如果我們發現國內業務放緩，我們知道在這樣的環境下如何應對。

We manage cost and capital expenditures aggressively. We are doing this now. We'll pull back on capital expenditures in this segment and we focus on the markets, services, and customers that have technology competitive advantages.

我們積極管理成本和資本支出。我們現在正在做這件事。我們將減少該領域的資本支出，並專注於具有技術競爭優勢的市場、服務和客戶。

Going into the second half of the year, the volumes of zinc bromide electrolyte shipments to yields will continue to increase. As Eos scales its manufacturing capabilities and delivers on its backlogs. We stay very close to that management team. We visited their production line in Pittsburgh three weeks ago. And came back very comfortable with their progress.

進入下半年，溴化鋅電解液出貨量與產量比將持續增加。隨著 Eos 擴大其製造能力並完成其積壓訂單。我們與該管理團隊保持著非常密切的聯繫。三週前我們參觀了他們在匹茲堡的生產線。他們對自己的進步感到非常滿意。

We get a rolling forecast from me that gives us confidence on the progress that they are making, and we expect every quarter to be stronger than the prior quarter. For upcoming investor events, we'll be in New York City on May 14 and 15 attending the Debora conference and also hosting an investor dinner and breakfast meeting.

我從我這裡得到了滾動預測，這讓我們對他們正在取得的進展充滿信心，我們預計每個季度都會比上一季表現更強勁。對於即將舉行的投資者活動，我們將於 5 月 14 日和 15 日在紐約參加 Debora 會議，並舉辦投資者晚宴和早餐會。

We'll be in Boston on June 3 and 4 at the Stifel conference. And back to New York City on June 4 for the RBC conference. We will also participate in two virtual conferences, the Lytham Partners on May 29. In the Northland Growth Conference on June 25. We are working to expand our investment base into the water technologies, and the energy transition sectors, given the growth of our battery storage and produced water desalination technology.

我們將於 6 月 3 日和 4 日參加在波士頓舉行的 Stifel 會議。並於 6 月 4 日返回紐約參加 RBC 會議。我們也將參加兩場虛擬會議，即 5 月 29 日的 Lytham Partners。在 6 月 25 日舉行的北地增長會議上。鑑於電池儲存和採出水淡化技術的發展，我們正在努力將投資範圍擴大到水技術和能源轉型領域。

Please visit our website or reach out to Kerr and Rye for more details. It was also very encouraging to see that in the last month, Tetra shares were acquired by two water index passive funds following our Oasis TDS and EOG announcements.

請造訪我們的網站或聯絡 Kerr 和 Rye 以了解更多詳細資訊。令人鼓舞的是，繼我們宣布 Oasis TDS 和 EOG 之後，上個月有兩隻水指數被動式基金收購了 Tetra 股票。

I believe that this is the start of our investor base expanding beyond the traditional oil and gas investors as we make progress with our growth initiatives.

我相信，隨著我們的成長計畫取得進展，我們的投資者基礎開始超越傳統的石油和天然氣投資者。

I'll turn this back to Brady for closing comments before we open up the call for questions.

在我們開始提問之前，我將把這個問題交還給布雷迪，請他發表最後評論。

Thanks, Elijio. In closing, we're off to a great start for the year and anticipate a very strong second quarter. Despite recent macroeconomic uncertainty, we have a strong conviction in the longer-term outlook and our proven ability to differentiate in the markets in which we operate.

謝謝，Elijio。最後，我們今年的開局很好，預計第二季也會表現強勁。儘管近期宏觀經濟存在不確定性，但我們對長期前景充滿信心，並且已證明我們有能力在經營的市場中實現差異化。

Our balance sheet is solid with close to $219 million of liquidity. We anticipate further growth in 2025 and expect to continue to generate strong free cash flow from our base business to fund our emerging growth investments.

我們的資產負債表穩健，擁有近 2.19 億美元的流動資金。我們預計 2025 年將進一步成長，並預計將繼續從我們的基礎業務中產生強勁的自由現金流，為我們的新興成長投資提供資金。

The combination of these plus advances with our produced water beneficial reuse solution, our Arkansas resource position, and strategic partnerships provides us the opportunity to continue to drive long term shareholder value. With that, we'll open it up to Q&A.

這些成果加上我們生產的水有益再利用解決方案、我們的阿肯色州資源地位和策略合作夥伴關係的進步，為我們提供了繼續推動長期股東價值的機會。接下來，我們將開始問答環節。

Thank you. Good morning and ladies and gentlemen, we will now begin the question-and-answer session should you have a question please press start followed by one on your touchstone phone. (Operator Instructions)

謝謝。女士們、先生們，早上好，我們現在開始問答環節，如果您有任何問題，請按“開始”，然後在您的 Touchstone 電話上按“1”。（操作員指示）

And your first question comes from Mr. Bobby Brooks of Northland Capital Markets. Please go ahead.

您的第一個問題來自 Northland Capital Markets 的 Bobby Brooks 先生。請繼續。

Alright guys, thank you for taking the question. So, I was just curious, you've been engaged with customer, you've been engaging customer discussions on Oasis for from with a number of parties, both EMPs and midstreams, and I was just really curious to hear what you guys believe is kind of the biggest hold up from these perspective customers on doing a commercial pilot and eventually an an actual commercial unit.

好的，謝謝大家回答這個問題。所以，我只是很好奇，您一直在與客戶接觸，您一直在與來自多方（包括 EMP 和中游）的 Oasis 客戶討論，我真的很好奇想听聽你們認為這些潛在客戶在進行商業試點並最終成為實際商業單位方面最大的阻礙是什麼。

Yeah, sure, Bobby. I think the first step is the customers need to get, totally comfortable, with the technology itself and with the, environmental framework that that's evolving, quite frankly, and it's come quite a long way. I think if you track, what's what's happening on the regulatory side, the legislative side, all things are starting to move in a positive direction, both in Texas and in Mexico.

是的，當然，鮑比。我認為第一步是客戶需要完全適應技術本身以及不斷發展的環境框架，坦白說，它已經取得了長足的進步。我認為，如果你追蹤監管方面和立法方面發生的事情，你會發現所有事情都開始朝著積極的方向發展，無論是在德克薩斯州還是在墨西哥。

We are, as I've mentioned previously in our calls, our expectations for this year was that we would have multiple pilot projects running, and in 2026, I think we would really start to see more commercial projects being negotiated.

正如我之前在電話會議中提到的那樣，我們今年的預期是將運行多個試點項目，到 2026 年，我認為我們將真正開始看到更多商業項目正在談判中。

I think that timeline now as we look at it could be accelerated. We're starting to see more requests by customers for commercial discussions of smaller scale commercial projects. So, we'll see how things evolve as we go through the year. It's a pretty dynamic environment.

我認為現在看來這個時間表可能會加快。我們開始看到更多客戶要求就小規模商業專案進行商業討論。因此，我們將觀察一年來事態如何發展。這是一個相當有活力的環境。

But we are seeing things trending, I would say quicker on the commercialization side than than maybe we were, on our last earnings call.

但我們看到事情正在呈現趨勢，我想說商業化方面的發展速度可能比我們上次財報電話會議的速度還要快。

It's very helpful caller and then just kind of piggybacking on that. You had mentioned that I think in the prepared remarks that you've seen some more regular and you just mentioned it on the on the in that answer but like more regulatory support for beneficial reuse could you maybe just point us to some specifics where you're seeing that, more that the better, the more support for this, revolutionary technology.

這對呼叫者非常有幫助，然後就可以搭便車了。您曾提到，我認為在準備好的評論中您已經看到了一些更為常規的情況，並且您剛才在回答中提到了這一點，但就像對有益再利用的更多監管支持一樣，您能否向我們指出一些具體情況，您看到的情況是，越多越好，對這項革命性技術的支持就越多。

Yeah, so we're engaged very heavily with both the Texas Railroad Commission and the TCEQ. That really looking over the permitting process now for Texas and so we have our own direct engagement with them so that's obviously we get a direct read from that. But I think if you look at some of the legislation that has been moving through the Texas House and Senate.

是的，我們與德克薩斯鐵路委員會和 TCEQ 都有密切的合作。這實際上是在審查德克薩斯州的許可程序，因此我們與他們有直接的接觸，因此顯然我們可以直接從中獲得資訊。但我認為，如果你看看德州眾議院和參議院正在審議的一些立法。

All, as I mentioned earlier, I can't point to a specific piece of legislation right now, but there have been several pieces of legislation moving through that supports the surface discharge and use of produced water for beneficial reuse, which in the past, has really been prohibited. So those are some key, I would say some key things to look at, Bobby from your perspective.

正如我之前提到的，我現在無法指出具體的立法，但已經有幾項立法正在通過，支持地表排放和生產水的有益再利用，而這在過去實際上是被禁止的。所以這些是一些關鍵，我想說一些需要關注的關鍵事項，Bobby，從你的角度來看。

Thank you, that's very helpful. And then maybe just the last one for me and I'll jump back in the queue is you're going to commence drilling for Evergreen's first production while in the coming months.

謝謝，這非常有幫助。然後也許對我來說只是最後一個，我會跳回隊列，您將在接下來的幾個月內開始為長榮的第一次生產進行鑽探。

And I just and I just wanted to understand, is this kind of a scenario where you can drill it and then leave it as like a duck like uncompleted and then as you build once the processing facilities is fully up, you can just kind of quickly go back there and turn it online. I just want to make sure I'm kind of understanding the timing here right.

我只是想了解一下，這種情況是不是這樣的：你可以先進行鑽探，然後把它像鴨子一樣擱置著，等到處理設施完全建成後，你就可以快速回到那裡並將其投入使用。我只是想確保我理解這裡的時間安排正確。

Yeah, that's that's exactly right. We will drill, obviously one well at a time. Once we drill and complete the first well, we'll essentially put it on standby without production until we have the bromine processing facility and then the full plant ready to be commissioned and then essentially you turn the brine field on and again, we'll start the first well this year.

是的，完全正確。我們會鑽井，顯然是一次鑽一口井。一旦我們鑽完並完成第一口井，我們基本上就會將其置於待命狀態，不進行生產，直到我們擁有溴處理設施，然後整個工廠準備好投入使用，然後基本上你打開鹽水田，再次，我們將在今年啟動第一口井。

We'll announce the timing of the second through the fifth well, which is what we have planned for the Evergreen unit as we as we go through the year.

我們將宣布第二至第五口井的開鑽時間，這也是我們全年為 Evergreen 裝置制定的計劃。

Brady, I think it's also important to remind everybody that we have a partner for all the upstream work and the cost of anything we do on the upstream side is shared with our partner proportional to the ownership that we have in the Evergreen Unit.

布雷迪，我認為有必要提醒大家，我們在所有上游工作上都有一個合作夥伴，我們在上游所做的任何事情的成本都是與我們的合作夥伴按我們在長榮單位的所有權比例分攤的。

Correct.

正確的。

Very helpful, thank you guys and congrats on the strong quarter.

非常有幫助，謝謝你們，並祝賀本季業績強勁。

Thank you.

謝謝。

And thank you. Our next question is coming from Mr. Martin Malloy from Johnson Rice. Please go ahead.

謝謝你。下一個問題來自約翰遜賴斯公司的馬丁·馬洛伊先生。請繼續。

Oh good.

哦，太好了。

We lost you there, Marty, if you can repeat.

我們在那裡失去了你，馬蒂，如果你能重複的話。

Marty, can you hear us? We can't hear you.

馬蒂，你聽得到我們說話嗎？我們聽不到你的聲音。

Yeah, I'm sorry, I'll dial back in.

是的，很抱歉，我會再撥過去。

We got you now.

我們現在抓住你了。

Kim, let's go to the next one and we'll circle back to Marty, make sure we cover him.

金，我們去下一個，然後繞回馬蒂，確保我們掩護他。

Sure, alright, next question is from Jesse Sobelson from the Boral. Go ahead, sir.

當然，好的，下一個問題來自 Boral 的 Jesse Sobelson。請說，先生。

Hey guys, thanks for taking my question. Just real quick on the numbers here, somewhat of a housekeeping item, but I noticed from the guidance that.

嘿夥計們，謝謝你們回答我的問題。這裡的數字非常簡短，有點像家務事，但我從指南中註意到了這一點。

The, I noticed that the number coming up a little bit was appreciative, but there seems to be, is it correct that you guys are implying a $30 million range for the second quarter of the year here, and I'm just kind of curious if so or not, yeah, second quarter of the year, and then I'm just curious if so, what the drivers of that dramatic, range could be to get to both sides of the high end of the line. Thank you.

我注意到，這個數字略有上升，這是值得讚賞的，但似乎有，你們暗示今年第二季的銷售額範圍是 3000 萬美元，對嗎？我只是有點好奇是不是這樣，是的，今年第二季度，然後我只是好奇，如果是這樣，那麼推動這一戲劇性範圍發展的因素是什麼，可以達到這個範圍的高端。謝謝。

Yeah, we're simply looking at the timing of the deep-water projects. We've mentioned in the past that they're large projects. We believe that we're obviously going to be in the range that we've highlighted both on the revenue and leave it.

是的，我們只是在關注深水計畫的時機。我們過去曾提到過，它們都是大型專案。我們相信，我們的收入和利潤顯然都會在我們所強調的範圍內。

If I understand your question though, also you were saying a $30 million range for just Q2, that's actually for the first half of the year, the range just to clarify.

不過，如果我理解你的問題的話，你剛才說的是第二季度的 3000 萬美元範圍，這實際上是上半年的範圍，只是為了澄清一下。

And then in the ranged the range spread is no different than what we said coming out the beginning of the year we just kind of reduced the range of the 315 to 345. So ranges comparable to what we said it's just a little bit lower.

然後，在範圍內，範圍擴散與我們年初所說的沒有什麼不同，我們只是將範圍從 315 縮小到 345。因此範圍與我們所說的相當，只是稍微低一點。

Okay, and the timing of the project is what's really going to determine what that number is and where we perform in the second quarter here. Okay, great, thanks. Thanks for taking my question.

好的，專案的時間安排實際上將決定這個數字是多少以及我們在第二季的表現如何。好的，太好了，謝謝。感謝您回答我的問題。

Okay, thank you. And our next question is from Tim Moore from Clear Street. Go ahead, sir.

好的，謝謝。下一個問題來自 Clear Street 的 Tim Moore。請說，先生。

Thanks, and nice operational execution in the March quarter. For my favorite perennial topic, the desalination of produced water, I mean, you have such an early first mover advantage there. You got the prior pilot experience ahead of any other competitors and you know that recent EOG Resources, important pilot project, the agricultural irrigation study with the acre.

謝謝，三月季度的營運執行情況很好。對於我最喜歡的長期話題，即採出水的海水淡化，我的意思是，你在那裡擁有如此先發優勢。您比其他競爭對手擁有更豐富的試點經驗，並且您知道最近的 EOG 資源公司的重要試點計畫是針對英畝的農業灌溉研究。

So, my question really is, how do you decide which additional pilot plant customers to prove you're going to have this. Inflow of demand, do you have a preference for ones that you already do the pre-treatment stuff advantage for in place. Just kind of curious how your kind of sorting through that and wait listing folks.

所以，我的問題實際上是，您如何決定哪些額外的試驗工廠客戶來證明您將擁有這一點。需求流入，您是否優先考慮那些已經做好預處理工作且具有優勢的。我只是有點好奇你是如何整理這些並把人們列入等候名單的。

Yeah, so I think we've announced we have seven NDAs in place with major operators. They're all important to us. They're all actually current customers of ours that we serve for our water and flow back business and recycling and treatment today.

是的，我認為我們已經宣布與七家主要營運商簽署了保密協議。它們對我們來說都很重要。他們實際上都是我們目前的客戶，我們今天為他們提供水和回流業務以及回收和處理服務。

So quite frankly we treat them all, equally as we can. Some are wanting to just do, testing at our research facility to demonstrate our capabilities with Oasis. Others are looking at deploying small pilots depending on, their appetite for risk and how quickly they want to move.

因此，坦白說，我們盡可能平等地對待他們所有人。有些人只是想在我們的研究機構進行測試，以展示我們使用 Oasis 的能力。其他人則考慮部署小型試點，這取決於他們的風險承受能力和行動速度。

We're able to run multiple pilot projects whether we're running them at our research facility or in the field. So, we have the capacity to work with all of them to demonstrate and get them comfortable with the technology. That's really not a challenge at this point.

無論是在我們的研究機構還是在現場，我們都能夠運行多個試點項目。因此，我們有能力與他們所有人合作，展示並讓他們熟悉這項技術。從這一點來說這確實不是一個挑戰。

I think the challenge will be if all of them, decide to start wanting to stand up a commercial plant, within a short period of time, that that is where we'll have to, start negotiating and discussing with them how we can handle the timing of that.

我認為，挑戰在於，如果他們都決定在短時間內開始建立一個商業工廠，那麼我們就必須開始與他們談判和討論如何處理這個時間安排。

Great, yeah, that, that's what I was definitely getting out more on the commercial side, but I'm just switching gears to Eos. I mean, you mentioned you visited their production facility earlier this month.

太好了，是的，那，那絕對是我在商業方面得到的更多的東西，但我只是轉向了 Eos。我的意思是，您提到您本月初參觀了他們的生產設施。

I expect you probably have a rolling production order schedule from them as they ramp up their output this summer for battery storage systems. If their first production line reaches that 2 gigawatt hours of annual production rate, maybe, I don't know, late next year, early 2027.

我預計您可能會收到他們的滾動生產訂單計劃，因為他們今年夏天將提高電池儲存系統的產量。如果他們的第一條生產線達到 2 千兆瓦時的年生產力，也許，我不知道，明年年底，2027 年初。

Do you have all the sourcing already in place, or do you need to sign up more 30, third party suppliers to meet that demand?

您是否已經做好了所有採購準備，或者是否需要簽約 30 多家第三方供應商來滿足這項需求？

Yeah, that's a fair question, and obviously this is something we track very closely for our deepwater project demands versus the EOS ramp up. We're very comfortable that for the first line of production for EOS there are two gigawatt hours that, we will be able to source and supply, all that we need.

是的，這是一個合理的問題，顯然，我們密切關注深水計畫的需求與 EOS 的成長。我們非常有信心，EOS 的第一條生產線將有兩千兆瓦時的電力，我們將能夠採購和供應我們所需的一切。

To meet that, the timing of when they move to their, additional capacity, which they talked about I think up to eight potential gigawatt hours, depending on the timing of that is clearly where we will need to have additional sources of certainly bromine, everything else we can source with the quantities that we need.

為了滿足這項要求，他們談到了何時轉向額外產能，我認為最多可達 8 千兆瓦時，這取決於具體時間，顯然我們需要額外的溴資源，以及其他所有我們可以提供的、滿足我們所需數量的資源。

Brooming will be the one that will have to closely match our future demand with their planned production, and we have those discussions with them, as Elijio said, very frequently.

Brooming 必須將我們未來的需求與他們的計劃生產緊密結合起來，正如 Elijio 所說，我們經常與他們進行此類討論。

And we're putting in place a lot of different things to make sure we're ready, whether it's our own bromine plant that will provide plenty of bromine to meet both our deep water and EO's future demand or the bridging supply agreements that we are having discussions with existing suppliers with today. So that's the balance that we're managing.

我們正在採取許多不同的措施來確保我們做好準備，無論是我們自己的溴工廠，它將提供足夠的溴來滿足我們深水和 EO 的未來需求，還是我們今天正在與現有供應商討論的過渡供應協議。這就是我們所管理的平衡。

Great, Brady. I got one last question for you and Elijio. So just for the potential bromine development project, I mean, it truly seems like you can self-fund it without triggering any equity dilution, which I think investors aren't giving you credit for yet, but would you.

太好了，布雷迪。我還想問您和 Elijio 最後一個問題。因此，僅對於潛在的溴開發項目而言，我的意思是，看起來你確實可以自行籌資而不會引發任何股權稀釋，我認為投資者還沒有給你信任，但你會這樣做嗎？

I mean, you don't have to answer this now, but are you, would you consider a project financing partner for, maybe, I don't know, 20%-25% stake, or would you rather maybe have project finance partners to roll out more desalination plans later on? I'm just trying to think about it in the back of my head, just, keep your leverage low.

我的意思是，您現在不必回答這個問題，但是您是否會考慮與專案融資合作夥伴合作，也許，我不知道，20％-25％的股份，或者您是否寧願有專案融資合作夥伴以後推出更多的海水淡化計劃？我只是試著在腦海裡思考一下，保持低槓桿率。

Absolutely, assume that we're constantly testing the market. We're looking for partners so that we can move with a higher degree of confidence in case the base business free cash flow does not move as fast as we expect. We are constantly looking for partners and testing the markets to find the optimal solution without diluting our shareholders and without over levering the company.

當然，假設我們不斷地測試市場。我們正在尋找合作夥伴，以便在基礎業務自由現金流沒有像我們預期的那樣快速成長的情況下，我們能夠以更高的信心採取行動。我們不斷尋找合作夥伴並測試市場，以找到最佳解決方案，既不稀釋股東權益，也不過度利用公司槓桿。

Great, thank you, I'm Brady. That's it for my questions.

太好了，謝謝，我是布雷迪。我的問題就這些。

Thank you.

謝謝。

And our next question is from Colby Sasso from Daniel Energy Partners. Go ahead, sir.

下一個問題來自 Daniel Energy Partners 的 Colby Sasso。請說，先生。

Hi, thanks for having me on the call. Your water and flow back margins for this quarter were 13%, which is down slightly quarter over quarter, but up nicely year over year. And you highlighted that automation and technology combined with cost controls are the reason for the expanded margins in the last 12 months.

你好，謝謝你接聽我的電話。本季的水和回流利潤率為 13%，較上季略有下降，但較去年同期大幅成長。您強調，自動化和技術與成本控制相結合是過去 12 個月利潤率擴大的原因。

Are there still more benefits to be seen from automation and technology, and can you maybe just speak to how you see the margins for the in the intermediate to long term?

自動化和科技是否還能帶來更多好處？您能否談談您如何看待中長期的利潤率？

Yeah, absolutely, probably one thing we didn't mention for the year over year improvement in margins. You'd mentioned the automation, certainly that's contributed the cost management, that's contributed, but we've also have a much larger portion of our water and flow back business that is treatment and recycling of produced water that has been a rapidly growing segment of our business throughout 2024, and we expect that to continue to grow.

是的，絕對是如此，可能我們沒有提到利潤率逐年提高的一件事。您提到了自動化，這當然有助於成本管理，但這也為我們的水和回流業務帶來了更大的份額，即生產水的處理和回收，這是我們在 2024 年業務中快速增長的部分，我們預計它將繼續增長。

In 2025 and that is typically a higher margin profile business for us. Yeah, as we go forward, I think I mentioned on the call, we only have about 25% of our fleet automated between sandstorms and our auto drill outs. We will be looking at directing the capital that we spend for this segment into automation as a priority and supporting our recycling and treatment.

2025 年，這對我們來說通常是一項利潤率較高的業務。是的，隨著我們不斷前進，我想我在電話中提到過，在沙塵暴和自動鑽探之間，我們只有大約 25％ 的車隊實現了自動化。我們將優先考慮將我們為這一領域投入的資金用於自動化，並支援我們的回收和處理。

Operations, so we believe we still have the ability to move margins up from where we are today. Now, second half uncertainty right now with the current climate, oil prices, tariff situation, it has created some uncertainty that that it's a little bit harder to give us specific guidance for the second half of the year, but our expectations is with the things that we're putting in place. We will still be able to move, margins upward from the from where we posted this quarter.

運營，因此我們相信我們仍然有能力提高利潤率。現在，由於當前的氣候、油價、關稅情況等因素，下半年存在不確定性，這帶來了一些不確定性，因此很難為我們提供下半年的具體指導，但我們的預期取決於我們正在實施的措施。我們仍然能夠提高利潤率，使其比本季公佈的水平更高。

And Colby, to add a little bit to what Brady said, we've taken investors out to visit some of our water treatment facilities in the Permian Basin. And we've been on job sites where we're treating 100,000 barrels a day, and there's only one person at the job site, per shift, and that's because of the automation that we've got in place.

科爾比，補充一下布雷迪所說的，我們帶投資者參觀了二疊紀盆地的一些水處理設施。我們曾在一些工地上每天處理 10 萬桶石油，但每班次現場只有一個人，這是因為我們採用了自動化技術。

And obviously those are much higher margins. The second point is we also mentioned that some of our lower margin businesses that we're closing and exiting those, so we'll end up with a better profile of the remaining business that we have as part of this changes that we're making.

顯然，利潤率高得多。第二點是，我們還提到，我們正在關閉並退出一些利潤率較低的業務，因此，作為我們正在進行的這些變革的一部分，我們將對剩餘的業務有更好的了解。

That was great color. Thank you so much. And just kind of switching up a little bit, going back to Oasis, could you talk about your expectations for the program and the Permian and what success would look like in your opinion compared to the results you've achieved in South Texas?

顏色真棒。太感謝了。稍微轉換一下主題，回到 Oasis 的話題，您能談談對這個專案和 Permian 的期望嗎？與您在南德克薩斯州的成果相比，您認為二疊紀盆地會取得什麼樣的成功？

Are you talking about technical results or commercial results or both Colby.

您談論的是技術成果還是商業成果，或者兩者兼而有之，科爾比。

Both would be perfect.

兩者都很完美。

Yeah, so in South Texas, because it's a much lower TDS total dissolved solids, we were able to achieve a 92% recovery of desalinated water from the from the feed water, which is obviously very high. The Permian is a much higher total dissolved solids, about 150,000 on average or so compared to 30,000 in South Texas. So, the yield that we will get, we're hopeful to get as high as 60%.

是的，在南德克薩斯州，由於 TDS 總溶解固體含量低得多，我們能夠從給水中實現 92% 的淡化水回收率，這顯然非常高。二疊紀的總溶解固體含量要高得多，平均約為 150,000，而南德克薩斯州則為 30,000。因此，我們希望獲得的收益率能夠高達 60%。

Yield of desalinated water from produced water that can go higher if we decide to start precipitating solids, precipitating salts out of the feed water, but initially that would be our target from a from a performance standpoint and an acceptable target from the customers that we're dealing with. As I've mentioned commercially, we've got commercial pilots.

如果我們決定開始沉澱固體，從給水中沉澱出鹽分，那麼從生產水中分離出的淡化水產量可能會更高，但最初這是我們從性能角度設定的目標，也是我們與之打交道的客戶可以接受的目標。正如我在商業上提到的，我們有商業飛行員。

We are getting paid for the pilot operations that we have. We're having discussions with multiple customers on first commercial scale units. Still early days for that. It's actually ahead of schedule from where I thought we would be, but we'll keep you posted as we go through the year in terms of our progress with commercial discussions for commercial plans.

我們正在因所進行的試點操作而獲得報酬。我們正在與多位客戶討論首批商業規模的裝置。目前還處於早期階段。事實上，這比我預想的要提前，但我們會在今年內隨時向大家通報商業計劃的商業討論進度。

Thanks for the color, I'll turn it back.

謝謝你的顏色，我會把它變回來。

Thank you. So, next question is coming from Steven Yenshaw from Stifel. Go ahead, sir.

謝謝。下一個問題來自 Stifel 的 Steven Yenshaw。請說，先生。

A couple for me. What I, what I'd start with, if you don't mind, is maybe for Leo on the free cash flow side you guys during COVID and other periods have always done a good job of maintaining, cash flow at solid levels. You mentioned kind of base free. Cash flow I think of about $50 million, and I think $30 million of that is excluding the sale of stock.

對我來說是一對。如果你不介意的話，我想首先要說的是，對於 Leo 來說，在自由現金流方面，你們在 COVID 和其他時期一直做得很好，將現金流維持在穩定的水平。您提到了無鹼類型。我認為現金流約為 5000 萬美元，其中 3000 萬美元不包括股票出售。

How do you think about that number in the in the environment we're in over the next several quarters and into next year? You think it's sustainable at that level? How do you kind of look at the puts and takes there?

您如何看待未來幾季以及明年我們所處的環境下的這個數字？您認為這種水平是可持續的嗎？您如何看待那裡的投入和產出？

Let me first clarify a comment. We keep saying in excess of 50, and we're trying to give us enough cushion in here so that we can exceed the benchmarks that we're laying out. In 2020, the first year of COVID, we generated almost $50 million of free cash flow as we monetized a lot of the receivables and inventory.

首先讓我澄清一下評論。我們一直說要超過 50，我們正在嘗試在這裡提供足夠的緩衝，以便我們能夠超越我們制定的基準。2020 年是新冠疫情爆發的第一年，我們將大量應收帳款和庫存貨幣化，產生了近 5,000 萬美元的自由現金流。

We don't think we're going to see a slowdown this year anywhere near what we saw with COVID. So, while we'll monetize some of the working capital, we still think that we've got a growth business occurring both with desalination and with the growth in the calcium chloride business and the electrolytes for Eos. We're pulling back on capital expenditures for the onshore business, and we will be below levels that we've been at before.

我們認為，今年的經濟放緩幅度遠不如新冠疫情期間那麼大。因此，雖然我們會將部分營運資金貨幣化，但我們仍然認為，我們的業務在海水淡化、氯化鈣業務和 Eos 電解質的成長方面都將實現成長。我們正在削減國內業務的資本支出，支出水準將低於以前的水準。

Also recognized that in the recent years, we had expanded capacity on the offshore fluids by building more storage and blending capacity in Brazil and also in the Gulf of Mexico. So those are behind us. We think that we can continue to pull down base business CapEx.

也認識到，近年來，我們透過在巴西和墨西哥灣建立更多的儲存和混合能力，擴大了海上流體的產能。這些都已經過去了。我們認為我們可以繼續降低基礎業務資本支出。

Without impacting the slowdown, without impacting our opportunity to take advantage of that offshore market, and that's why we keep repeating, we'll be north of $50 million of free cash flow inclusive of the Kodiak sales, and that does not imply $30 million for the base business.

在不影響經濟放緩、不影響我們利用離岸市場機會的情況下，這就是我們不斷重複的原因，包括科迪亞克的銷售額在內，我們的自由現金流將超過 5000 萬美元，而這並不意味著基礎業務的自由現金流為 3000 萬美元。

Okay, great, thank you. That helps. The other two questions I had, what was the bigger picture, and I get this from investors a lot, and when you think about the water desal opportunity and the technology, as it evolves, like what should we be thinking about as far as the Environment in which it's most applicable as far as it's one thing to kind of recycle the water, it's another thing to have a beneficial reuse. So what are sort of the drivers or parameters of an area that need to be in place for it to be kind of most applicable?

好的，太好了，謝謝。這有幫助。我還有另外兩個問題，那就是更大的前景是什麼，我經常從投資者那裡聽到這個問題，當你考慮海水淡化機會和技術時，隨著它的發展，我們應該考慮什麼，就其最適用的環境而言，回收水是一回事，進行有益的再利用是另一回事。那麼，為了讓某個領域最適用，需要具備哪些驅動因素或參數呢？

Yeah, Stephen, so there's a couple components to that question. I think the first one is. That you know the available pore space directly in the Permian Basin, where the water is being produced. And the Delaware Basin, but the available pore space is filling up. These reservoirs are overpressuring.

是的，史蒂芬，這個問題有幾個部分。我認為是第一個。您可以直接了解二疊紀盆地中可用的孔隙空間，那裡正在生產水。還有特拉華盆地，但可用的孔隙空間正在被填滿。這些水庫壓力過大。

You can see various reports that show the pressure trends within the reservoirs where they inject. That's public information. And so there is a time horizon where the in basin space in basin injection is essentially going to be restricted even further, considerably further than what it is today. So what you see now are operators who have to start designing.

您可以看到各種報告，顯示注入油藏內的壓力趨勢。這是公開資訊。因此，在某個時間範圍內，盆地內的注入空間基本上會受到進一步的限制，比現在的限制大得多。所以你現在看到的是操作員必須開始設計。

Midstream systems working with midstream companies to carry produced water outside of the basin and that's pretty, that's expensive both from a capital and an CapEx perspective. I think you've probably seen several announcements made in the last few months about out of basin disposal systems being set up by the midstream companies.

中游系統與中游公司合作將採出水運送到盆地外，從資本和資本支出的角度來看，這是相當昂貴的。我想您可能已經看到過去幾個月中游公司發布的幾份關於建立盆地外處置系統的公告。

But again, ultimately, that's going to face the same type of challenge that you see with the in basin. It's just such a huge volume of water that physics, will ultimately take over. So that's one part of it, the cost the operators have to find a solution to the problem.

但最終，這將面臨與盆地內同樣的挑戰。水的體積如此巨大，物理學最終將佔據主導地位。這就是其中的一部分，即營運商尋找問題解決方案的成本。

I think the other part of it is water is a valuable resource. The Permian goes through a lot of droughts, a lot of parts of Texas, South Texas, go through periods of droughts. There's incredible need for water. That we can treat this for, as we say, beneficial reuse for agricultural purposes, industrial purposes, the data centers that are going to be stood up.

我認為另一方面是水是一種寶貴的資源。二疊紀經歷了多次乾旱，德州的許多地區、德州南部都經歷了一段時間的乾旱。人們對水的需求量極大。正如我們所說，我們可以將其用於農業用途、工業用途以及即將建立的資料中心等有益的再利用。

All of these, the manufacturing centers that we're talking about now, all of these applications require, pretty high spec water in some cases that we can meet. So, I think it's a combination of both factors that set the conditions that are going to make this this thrive, Stephen.

我們現在談論的所有這些製造中心，所有這些應用在某些情況下都需要相當高規格的水，我們可以滿足。所以，我認為是這兩種因素的結合創造了使這項事業蓬勃發展的條件，史蒂芬。

Okay, thanks. And then my file, you, I think Elijio alluded to this response to a prior question, but when you think about the margin profile in water and the automation, I think Elijio suggested that there is potentially some upside in the second half of the year, or was that a longer-term comment?

好的，謝謝。然後我的文件，你，我認為 Elijio 提到了對先前問題的回答，但是當你考慮水和自動化的利潤率時，我認為 Elijio 認為下半年可能會有一些上行空間，或者這是一個長期評論？

Well, so let's be clear. I think it depending on the magnitude of the pullback in the second half of the year and how much excess capacity might be out there to compete against, that's an unknown. We think we can control our destiny by focusing on those clients that value technology.

好吧，讓我們說清楚一點。我認為這取決於下半年回檔的幅度以及可能有多少過剩產能需要競爭，這是一個未知數。我們認為，專注於那些重視科技的客戶，我們可以掌控自己的命運。

That take advantage of the differentiations that we bring, that we keep upgrading the revenue base and keep moving to produced water and away from the lower margin business, but we don't have this completely under our control. It's going to be partially market dependent and a lot of our efforts are going to be to counter that.

這利用了我們帶來的差異化優勢，我們不斷升級收入基礎，不斷轉向生產水，遠離利潤率較低的業務，但我們並不能完全控制這一點。這將在一定程度上依賴市場，我們將付出很多努力來應對這種情況。

Got it. Great. Thank you for the details.

知道了。偉大的。感謝您提供詳細資訊。

Thanks.

謝謝。

Alright, next question is from Mr. Bobby Brooks from Northland Capital Markets. Go ahead.

好的，下一個問題來自 Northland Capital Markets 的 Bobby Brooks 先生。前進。

Hey guys, thanks for taking this, second round of questions. Just one for me. I was just curious, had not necessarily touched on in the Q&A, but I was really.

嘿夥計們，感謝你們回答第二輪問題。對我來說只有一個。我只是好奇，在問答中不一定提到，但我確實好奇。

It interested in, could you maybe just compare and contrast the deepwater market outlook now versus when you reported 4Q in February and WTI was in the low 70s? Does the long cycle nature of these deep water market deep water products projects really help insulate development from stalling due to commodity price downturns?

有趣的是，您能否將現在的深水市場前景與您在 2 月報告的第四季度和 WTI 價格處於 70 年代初期時的情況進行比較和對比？這些深水市場深水產品專案的長週期特性是否真的有助於避免因商品價格下跌而導致開發停滯？

Yeah, Bobby, clearly, deep water is a longer term cycle. So I mean I would answer that by saying, we haven't seen any changes by operator deepwater projects, that are scheduled for this year.

是的，鮑比，顯然，深水是長期週期。所以我的意思是，我會這樣回答，我們沒有看到運營商今年計劃進行的深水項目有任何變化。

There is obviously some uncertainty in the market right now. Commodity prices went lower. You could potentially see some projects being pushed to the right, but probably not the projects that are on the calendar for this year. They're most likely already contracted, already a lot of things put in motion to deliver those wells.

目前市場顯然存在一些不確定性。大宗商品價格走低。您可能會看到一些項目被推到右邊，但可能不是今年日曆上的項目。他們很可能已經簽訂了合同，並已開始實施許多措施來交付這些油井。

So, we don't expect any real change to the water this year. Now if oil prices go lower and stay lower for longer, for the rest of this year, you could start to see some projects again pushed out to the right. We don't expect that, but clearly there's quite a bit of uncertainty that we can't say specifically that won't happen.

因此，我們預計今年水質不會發生任何實質變化。現在，如果油價繼續走低並維持較長時間，那麼在今年剩餘時間內，你可能會看到一些項目再次被推遲。我們並不期望這種情況發生，但顯然存在相當大的不確定性，我們無法具體地說這種情況不會發生。

Bobby just real quick, just want to add to that. I think this week we've already had a couple of offshore drillers announce their earnings and provide some outlooks with some additional contracts which are slated to the start in 206 and roll into 2027. So as of this juncture, there's been no real pause on these deep-water drilling programs.

鮑比只是很快地補充一下。我認為本週我們已經有幾家海上鑽井公司宣布了他們的收益，並對一些額外的合約做出了一些展望，這些合約預計將於 206 年開始並持續到 2027 年。因此，截至目前，這些深水鑽探計劃尚未真正暫停。

Got it. Okay, that's really helpful caller. I'll return to the queue. Thanks guys.

知道了。好的，這位來電者確實很有幫助。我會回到隊列。謝謝大家。

Thanks.

謝謝。

This concludes our question and answer session. I would like to turn the conference back over to Mr. Murphy for any closing marks.

我們的問答環節到此結束。我想將會議交還給墨菲先生，由他來做結束語。

Thank you very much for joining us again. We're very pleased with the start that we've got to the year, very pleased with the outlook we have for both the second quarter and the business that we are we are evolving to with our with our future projects. So, thank you for your interest and thanks for joining us.

非常感謝您再次加入我們。我們對今年的開局感到非常滿意，對第二季的前景以及我們未來專案正在發展的業務感到非常滿意。所以，感謝您的關注並感謝您加入我們。

Ladies and gentlemen, this concludes today's conference call. Thank you for participation. You may now disconnect.

女士們、先生們，今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。