Tetra Technologies Inc (TTI) 2025 Q3 法說會逐字稿

Hello and thank you for standing by. My name is Tiffany, and I will be your conference operator today. At this time, I would like to welcome everyone to the Tetra Technologies Third quarter 2025 earnings conference call.

(Operator Instructions). I would now like to turn the call over to Kurt Hallead, Treasurer and Investor Relations. Kurt, please go ahead.

Thank you, Tiffany. Good morning and thank you for joining Tetra's Third quarter of 2025 earnings call. The Speaker for the speakers for today will be Brady Murphy, Chief Executive Officer, and Elijio Serrano, Chief Financial Officer.

Before we begin, I'd like to call your attention to the Safe Harbor statement in our Forum 10-Q. Some of the remarks we make today may be forward-looking and are subject to risks and uncertainties as outlined in our SEC filings.

Actual results may differ materially from those expressed or implied. In addition, we may refer to adjusted EBITDA and other non-GAAP financial measures. Please refer to our press release for reconciliation of GAAP and non-GAAP measures.

These reconciliations are not a substitute for GAAP Financials, and we encourage you to refer to our 10-Q that was filed yesterday. After Brady and Eli Hill provide their comments, we will open the line for Q&A. I will now turn the call over to Brady.

Mm Thanks, Kurt, and good morning everyone. Welcome to Tetcha's Third quarter 2025 earnings call.

Late last week, our colleague and good friend Elio announced that he will retire at the end of March next year.

As part of Tetra's succession planning process, Matt Sanderson will replace Elihio as CFO. Matt is currently executive Vice President and Chief Commercial Officer, having joined Tetra in November of 2016.

Through the end of March 2026, both executives will continue in their existing duties and responsibilities to deliver and execute on the company's one Tetra 2030 objectives. Upon his retirement, Ely Hill will continue to serve in an advisory capacity for the company.

Since I became CEO in May of 2019, Elio has played a key role in working with me and our executive team to refocus the company on our core fluid chemistry expertise, and the results speak for themselves.

From guiding the company through arguably the industry's most challenging period during the COVID-19 pandemic to the divestiture of our general partnership in CSI Comresco and shaping our one Tech of 2030 strategy, Lee has been a strong contributor to our current success and future outlook.

The board of directors, and the rest of the executive team are very grateful for his contribution and are pleased he will continue to serve in a non-executive advisory role.

Fortunately, we have a strong executive team that many of our investors had the chance to see and hear from at our recent investor day at the New York Stock Exchange in September. And as part of our succession planning process, Matt is well prepared for the transition to CFO.

The recent addition of Kurt Howland as VP of Industrial Relations FTNA and Treasury, along with Catherine Kokinis as CAO has significantly strengthened our current and future financial organization. I'm confident there will be a smooth and seamless transition.

Now I'll summarize some highlights for the quarter, provide an update on our strategic initiatives before turning the call over to Lehio to provide some more details about the financials and our guidance.

Our employees delivered a very strong Thirdrd quarter results against the backdrop of an ongoing challenging industry environment. Our Third quarter, combined with our first quarter, first half year results, allowed us to reach the highest revenue of $484 million and adjust to the EBITDA of $93 million in the past 10 years.

Mainly driven by chemicals and deep water completion fluids, this 10 year record is further highlighted by the fact that the overall deepwater recount is 40% lower than it was 10 years ago, emphasizing the significant deepwater market penetration we have achieved.

For the quarter, we achieved revenue of $153 million and adjusted the EBITDA of $25 million with adjusted EEA margins of 16%.

This represents an 8% year over year increase in revenue and 7% rise in adjusted EBITDA, driven by continued strength in our offshore completion fluids and industrial calcium chloride business.

Third quarter completion fluids and products revenues increased 39% compared to the previous year period with adjusted EO margins rising by [6.9 EI] rising by $6.9 million.

Through the first nine months of the year, completion of fluids and products suggest that even that margin reached 34.5%, a 500 basis points improvement compared to the same period in 2024.

This was driven by a successful completion of three tetraneptune wells in the Gulf of America, increased demand for high density zinc bromide completion fluids, strong contributions from Brazil deep water projects, and robust calcium chloride results in Northern Europe.

Before year 2025, we believe completion fluids may reach a ten-year high.

As highlighted at our recent investor day, the long-term outlook for the completion fluids and products business remains strong, driven by deep water completion activity, exceptional performance in our industrial chemicals business, and a material increase in battery electrolyte revenue as our customer ramps up deliveries from its first automated production line.

Water and flowback services revenue declined 2% for the second quarter and 18% year over year. Adjusted rose 18% sequentially due to better cost controls.

I fell 33% from the same period last year on lower activity. Sequential adjusted margins improved by 200 basis points to 12%, driven by higher utilization of our patented automated tetras sandstorm and auto drill out units, efficiency gains, and cost controls.

This performance was achieved despite a 12% sequential decline in the US frac crew crew count and a 27% decrease compared to the second quarter of 2024.

Despite a muted outlook for the US frac crude count, we expect our onshore testing and flowback business to benefit from three industry trends longer laterals, increased sand, and water usage, and a continuous rise in overall volumes of produced water.

Outside of the US, we are seeing the benefit of material increase in overall unconventional activity in Argentina and the Middle East.

We're currently 100% utilized with our automated sandstorms units in Argentina. And have recently been awarded Tetris sandstorm work in the kingdom of Saudi Arabia.

In Argentina's Vercamorta region, we've been awarded 5 contracts related to production testing, sandstorms, and two production facilities, one of which is now operational, and the second is expected to go live in the first quarter of 2026.

These recent winds in Argentina.

Utilizing the technology we've developed in the US on conventional shale plays are expected to almost double our revenue next year in Argentina, helping to minimize the uncertainty in the US onshore activity.

With respect to our Arkansas brooming plant, we've generated $58 million of business free cash flow and invested $28 million in the project through the first nine months of this year.

We are on schedule and under budget for phase one of the project and remain confident that the plant will be fully operational by the end of 2027.

The plant will have a capacity to process 75 million pounds of roaming per year, which is more than double that of our current long-term third-party supply agreement. This will also enable Tetra to generate between $200 million to $250 million in additional revenue and between $90 million and $115 million of adjusted.

As noted in our definitive feasibility report.

Adjusted to EA target contribution is underpinned by lower input costs and additional volumes for the battery, electrolyte and deep water completion fluids business.

At our investment date on September 25, 2025, we unveiled One Tetra 2030, a strategy focused on leveraging our core fluids chemistry expertise into new high growth and markets, notably delivering battery electrolytes for long duration energy storage, as well as oil and gas produced water desalination solutions.

Elgas to more than double revenue to over $1.2 billion and triple adjust the EBITDA to over $300 million by 2030. We're very appreciative of the attendance and the interest in our investor day presentation. The feedback has been overwhelmingly positive and supportive of the strategy and the executive team that will deliver the one Tetra 2030 targets.

On the electrolyte front, we're encouraged by the progress Eos Energy continues to make in automating their first manufacturing assembly line and its recent announcement that it will expand its manufacturing capacity in 2026.

As the AI push continues to drive increasing energy demand, the importance of power stability through zinc bromide long duration storage systems appears to be gaining traction, mainly due to its safety, scalability, and domestic sourcing.

To account for that, we have completed the installation of our bulk delivery system, which will significantly increase the electrolyte volumes in 2026.

Moving to water treatment and desalination, the US oil and gas industry is facing an increasingly urgent challenge in managing produced water, particularly in the Permian Basin, where over 6 billion barrels of wastewater are injected into saltwater disposal wells annually.

This traditional underground injection method is becoming less feasible as downhole formation pressures keep increasing and storage storage pore pressure fills up.

With the commercial launch of Tetra Oasis and the engineering design of the Industry's 1st 25,000 barrels per day produced water treatment and recycling facility. Tech is well positioned to lead in solving this problem.

The front end engineering and design has been completed and the estimated capital and operating expenses are within our initial projections for the project.

This step is facilitating commercial discussions with multiple customers, and we remain confident that we could sign our first commercial contract in the coming quarters.

We have a strong free cash flow generating based business and our one Tetra 2030 strategy will enable us to leverage our fluids chemistry expertise into new high growth and markets. We believe this transformation will enable Tetra to generate over $100 billion in annual adjust to free cash flow by 2030 and drive meaningful cash returns for our shareholders. I'll turn it over to Elio to discuss the financials.

Thank you, Brady, and thank you for the kind words. I'm not going anywhere, nor slowing down between now and next March. We've got a job to do.

We ended the third quarter with $67 million of cash on hand and net leverage ratio of 1.2 times.

Throughout the year, our focus has been on generating free cash flow from the base business to maintain a strong balance sheet and to self-fund as much of the roaming project as we can.

We have accomplished this through aggressive cost reductions in our onshore business, carefully scrutinizing all capital expenditures, and remain very focused on managing our working capital.

Working capital was $113 million at the end of September, an increase of only $4 million from year end. As a comparison, third quarter revenue of $153 million was $19 million higher than the fourth quarter.

Yet working capital is only up $4 million. The ESO has improved two days from the fourthrthrthrth quarter. This highlights the focus we have on generating cash from the base business by managing inventory and receivables.

Since the end of September four weeks ago, our liquidity has further improved.

Increasing $10 million from $208 million to $218 million inclusive of the $75 million dollar delay drop feature.

That is available to Tetra for the Broome project. In an effort to further reduce our cost structure and reduce corporate G&A expenses. We are expecting to relocate to a new corporate office later this quarter. The new office is a short distance from the current office in the Woodlands.

Compared to our current lease, we expect to reduce lease expense by approximately $2 million per year. We updated our 2025 guidance. Income before taxes will reflect on a fourth quarter non-cash charge as we early terminate the existing lease and move to a new lease with significant lease concessions for the 1st 2 years.

With respect to the outlook, to your projected even is now expected to be between $107 million and $112 million.

This compares to our prior total year estimate of between $100 million and $110 million. And this takes into account the stronger than expected Third quarter. They benefited once again by strong offshore activity.

The fourth quarter is expected to see continued weakness on the onshore site. The timing of deepwater projects in the fourth quarter will dictate whether we are near, nearer to the lower or the higher end of the guidance range.

We call that as deepwater activity improves, some projects moving between quarters can have a meaningful impact on this or the next quarter, and some of these projects are hard to predict exactly when they will be completed.

US onshore remains challenging, but we continue to leverage automation. Technology and strong cost control to keep our margins in the double-digit range. The wind, the winds in in Argentina would, will be a tailwind for us next year and are expected to improve our onshore margins.

EOs in the deep water market will also be a tailwind for us next year. Let me close by summarizing what I believe to be the items everyone should focus upon. First, the Third quarter was another quarter where we outperform with stronger than expected revenue.

EBITDA and cash flow. We like the cadence that we're on. Second, we continue to wind work both offshore and now with the significant wins in Argentina that Brady mentioned. The base business is performing in a challenging market environment.

Third, the immediate milestones we laid out is the road markers for 2030 are materializing. EO volumes are increasing and EOS is launching to build out their second line. The bromine plant remains on schedule and within budget, all self-funded.

The front-end engineering study for the first decenthalation facility was completed on schedule and confirmed by cappex and OE numbers. Now we are changing terms and pricing with customers and we're ex expect and we're expanding our business internationally with the Argentina wins that Roy mentioned during the investor days as a goal.

The journey towards one tetra 2030 remains on schedule.

Brady, let me turn it back to you for closing comments.

Thanks, Leo.

Despite the ongoing macroeconomic and energy market uncertainty, we have strong conviction in the longer-term outlook, our ability, proven ability to differentiate in the markets in which we operate and our one of 2030 strategy. With that, we'll turn it open for questions.

(Operator Instructions)

Your first question comes from the line of Bobby Brooks with Northland. Please go ahead.

Hey, good morning, guys. Thanks for taking the question and want to congrats lie on an incredible career.

Just first on the Oasis commercial engineering, it's great to hear you completed the feed study, but I just wanted to understand. Are there any further engineering work that needs to be completed or just maybe more broadly, what are the next steps there?

Yeah, no, certainly, Bobby.

Yeah, no, the feeds is an important milestone because it validates, what we had estimated in terms of the CapEx and the apex and the overall financials.

For our desalination technology. 25,000K is still a relatively small scale commercial plant. We expect, in fact, the discussions we're having are, much larger facilities where the economics will even get improved from there, as we get higher volumes.

But the next steps are really socializing, discussing these, the economics, financials with the customers that we're engaged with, as we've mentioned before, we've got seven NDAs in place, those customers have been waiting for us to get to a point where we could have commercial discussions and and those those discussions are initiated.

So as far as additional engineering, we have enough confidence in the engineering that's been done to this point to enter into commercial discussions and a contract, but there is still the, detailed engineering that has to be done in order to construct the final plan. So that, that'll be part of the next steps.

Would that detail engineering to then construct the final plan would is it reasonable to think that that would.

Be kicked off once a commercial agreement was signed or that maybe come before that that when.

Yeah, we'll most likely, I mean, we have high confidence in commercializing this technology, and so we're already getting a proposal together from the engineering firm that we're working with to start the detailed engineering ahead of any commercial contracts.

Very helpful color and then just on the CFP sales, so I'd step down about $19 million sequentially, but obviously it's more importantly up $15 million year over year and obviously a big factor on the sequential step down is the absence of Neptune jobs in the seasonal industrial industrial calcium chloride sales.

What I was hoping to get a little bit more color on is. Thinking about that $90 million step down, is that all essentially the absence of those two factors and then reversely looking at the $15 million dollar year over year increase, could you maybe break down what were the different breakdown, what were the different factors that drove that growth? Thank.

You.

Leo, you want to take.

That one? Yeah, so Bobby, the vast majority of it was the European calcium chloride seasonality, and recall that we also had a Neptune, a well and half of Neptune that we completed in the second quarter.

So it was those two partially offset by the ramp up in activity in Brazil that we've been talking about.

Fair enough, thank you.

Your next question comes from the line of Martin Malloy with Johnson Rice. Please go ahead.

Good morning, Leo. Best of luck with your future endeavors upon retirement.

Thank you.

First question I wanted to ask about was just in terms of the offshore market, it seems like it's been strengthening for you all. And when you look at the subc preorders for the industry, they've been trending up.

Can you maybe talk about your confidence as you look forward to 26, 27, and any early indications as to whether Neptune projects are a possibility in 206?

Yeah, sure. Thanks, Marty. Now, look, we have, we see the same thing you do with the offshore activity from our customers' discussions as well as the subtre subtre, subsea tree orders.

So yes, we have a strong confidence in 26 and 27 and beyond, quite frankly, we think that the deep water market is going to be on a pretty nice long run.

Certainly as the US shale play starts starts to plateau. But in terms of Neptune, I think our pipeline is as strong as it's ever been. So I would say we have a fairly high degree of confidence that we will be executing.

Work in 2026 and beyond with Neptune. Obviously, we don't want to give any specific, information on that until we have the well defined the project awarded, and then we can give more detail, but we have, we have a high confidence level.

Great, thank you. And for my follow-up question, wanted to ask about on the desalinization side and very encouraging to see the you expect a first commercial project in the early 2026.

Can you remind us of the the capital cost for one of these standard facilities and and maybe your outlook for initial couple commercial projects, whether they're going to be owned by the customer.

The facilities that is are owned by Tetra, how that breaks down.

Yeah, I'll answer the commercial model, Marty, that we are utilizing. First of all, the core technology within the plant will always be owned by Tetra.

We have a couple of different commercial models. One is a licensing model, a long-term licensing model, but what Tetra will continue to maintain ownership. We have a shared capital, a project. Financials as well as one where the customer funds the capital if they have a lower cost of capital and they prefer to do that.

So we have a couple of different models with that type of flexibility, but in either case, Tetravv will maintain control and ownership of the of the core technology within within the plant itself.

As far as the CapEx goes, I think general industry numbers that are out there are, a million dollars of CapEx for every 1,000 barrels of DSA.

I would say that those numbers are are relative to the core technology that we bring to the equation. There's also Civil works and depending on, where power is derived for the project that would be an addition to that. But those those are order of magnitude type numbers that we're confident in.

Great, thank you. I'll turn it back.

Your next question comes from the line of Steven Gingaro with Staple. Please go ahead.

Thanks. Good morning, everybody.

Good morning. Good morning, Stephen.

I apologize if you touched on this earlier, but at a high level when we think about 26 versus 25 and we think about the first half of 25 and the fluid side, can you outline the puts and takes into 26, maybe even off the back half of 25 if it's it's easier given what we know about.

The deepwater fluid business in the first half and then and maybe along with that you you did mention confidence in the deep water business. What's the timing look like because it it sounds like the ramp recovering deep water is kind of a mid 26 event based on what some of the larger cap service guys are playing and how does that kind of fold into the timing of your process?

Yeah, I'll take that first, Steven, and then Elio let you add some additional.

Comments. So as we look forward to 2026, there's a couple of, really strong growth pieces of our business. We mentioned Argentina, the awards that we've recently received, as I mentioned, we should double our revenue. In Argentina in 2026/2025.

Even the Middle East with the recent sandstorm awards, that will be some additional growth for us. EOS will be, as anticipated to be a very large material ramp up from us.

EOS activity for us in 2025. It's well up over 2024, but it's still, I would say it's not really, has not really been a material part of our business so far. It will, we believe it will be very much so material business for us in 2026.

As far as the deepwater work, the markets that we're strongest in the Gulf of America, Brazil, North Sea, particularly on the Norway side, we have good visibility into the projects and our customer plans for those markets in 26.

And so we, that's why we have a confidence level and because of those markets and those customers for us in 26. Now, the Neptune can move the deal for us as you well know.

Our confidence level, as I've mentioned, is high for 2026. Now whether those come in the first half of the year or second half of the year, we'll give a little more color as we get into, the start of the year, with a little bit there's a visibility on that, but those are all contributing factors to what we think will be a pretty strong 2026 for us on the deepwater side.

Milli here, did you want to add anything?

Kirk, hey Steven, you referenced an interesting point just on rig activity. Look, as right, the rig count doesn't necessarily, it underrepresents what our opportunity set is from the completion side.

So I would not necessarily take what you're hearing from the the drilling contractors about a little bit of a lull in contracting activity and suggest that there's any direct correlation to our outlook for the completion side of the business.

Yeah, and, even to add if you want to sequence the second half of this year to the first half of next year, Brady mentioned Argentina, we got a ramp up occurring there. Obviously we expect yield continues to increase volumes.

Every second quarter we we see around a $15 million dollar increase in our Europe calcium chloride business, and the Brazil market continues to perform quite nicely for us. So there's quite a few tailwinds that I think are going to benefit us in the first half of.

Next year compared to the second half of this year.

I don't know if you'll answer this, but if we exclude EOS, does fluids grow 26/25?

We believe so because of the the water market and the activity that we're seeing out there.

Okay, great.

That is all for me. I appreciate all the.

Color.

Your next question comes from the line of Tim Moore with Clear Street. Please go ahead.

Thanks and congratulations to Leo for his retirement plan and he will be well missed. So.

Just maybe starting out on desalination.

You maybe provide us with an update on the beneficial reuse, a growing season, for EOG, I can't remember if that needed maybe two growing seasons and then just on the topic, you talked about feed study and progress and everything.

Can you just maybe remind us of any remaining regulatory related milestones that that first customer might have to do in Texas to get signed off to really start the construction.

Yeah, I think that the regulatory side of that equation is, has really been constructive Tim over this past year. I mean we're again, a reminder that, we're not the ones that apply for the permit.

Our customers are, so they're the ones who will still own the water and will be responsible for the permitting, but all of the information that we have, tells us that is being. Well facilitated by the regulators these days, so no real concerns on that on that side of it.

As far as the program we have with EOG, we do have an NDA in place on that project, and so, we're limited to the details that we can give, we can say it's going very smoothly, very successfully, and very encouraged by the progress of the pilot.

It is a grasslands studies as we've, it's actually a grasslands growth project. But that's really as much detail as we can share at this point other than it's going very well.

Understood that that was helpful color and then just, switching gears to EOS Energy, they hold their quarterly earnings call next week on the 6th.

Can you just give us a sense of maybe, Tetra's lead time visibility, rolling orders. I mean, is it kind of a rolling, 60 days or 90 days advanced planning period, for you to get the solutions ready for ure fillow plus and electrolytes, just kind of thinking about that, as we model out the fourth quarter and that probably ramps up for them and you benefit.

Yeah.

So we're in constant dialogue with the, on a weekly basis between our manufacturing team and their procurement team at the executive level, appears to be almost like a weekly or every other week call.

Once we get the purchase orders, we can turn it around quite quickly. As we're producing the electrolyte out of our West Memphis facility. That facility is producing the the zinc bromide that is either used for the offshore market or we further purify it and increase the purity levels there to meet the EO's demands.

And all the incremental products that we buy are available on short orders, so we can turn around purchase orders within 30 days from you.

Great. That, that's really helpful, color, and then, my last question is because most of the others already asked.

And my favorite thing in the last few years has been desalination, but you don't get asked a lot about your calcium chloride business, and you know we know there's seasonality drop in the third quarter every year. But how would you kind of quantify maybe that overall business, nine months year-to-date, does it grow more than 5% this year, the industrial accounting clients?

So Brady, I'll take that 111 of the things that we joke about is our the leader for our calcium chloride business, Tim Mo, every time he gets in front of the board, he talks about our record quarter, and they literally have been achieving a record quarter with the calcium chloride business.

They have found, additional applications for the for the calcium chloride. They continue to expand and gain market share. So that business is one of our little crown jewels that probably isn't recognized and appreciated as much as it should, and they've been outperforming the consumer price index by a nice factor.

And if I could just add to that, Tim, if we look as we laid out in our investor day, that business tends to outpace the growth of GDP by something north of 300 basis points.

No, yeah, it's, I'm pretty familiar with that, I think the investors just really haven't caught on in the last few years that I mean it was something like I calculated, 35% to 40% or, you, last year or the year before, so I'm always curious of how that's going. It seems like it's going great, so that's it for my questions. Thank.

You, Tim. I will add that we updated our investor deck and posted it on our website this morning to reflect Q3 numbers, and it includes TTM Q3 calcium chloride revenue and the trend. I encourage you to take a look at it to appreciate how that business is performing.

Oh, that's great. That's good visibility. Thanks, Leo.

Your next question comes from the line of Josh Jane with Daniel Energy Partners. Please go ahead.

Good morning. Thanks for taking my question. First, just as we think about offshore opportunities in the next year, you've hit on it a little bit. Maybe you could just talk through your key markets, Brazil, Gulf of America, North Sea, and in the event that we've seen this over the last couple of years.

Things can slip to the right when thinking about offshore projects.

Could you discuss which of those markets you may expect to hold up better than others in the event operators become increasingly cautious and just talk through those opportunities a bit more?

Yeah, sure, Josh. I mean.

I think, keep in mind the Brazil Awards that we were awarded, we, we've really only seen a half a year of benefit from Brazil this year. So next year we're expecting to see a full benefit and not really anticipating any.

Any change to that program, I would say the same for the Gulf of America we've mentioned in our investor day, as more and more operators start moving out to the lower tertiary, these wells are have have significant productivity.

And even in a lower cost environment we anticipate those projects to continue to move forward so no real change in our outlook for for Gulf of America and then North Sea, I'd say the same. Ecuador and the and the businesses in Norway continue a very strong pace again, we're not anticipating much change there.

Now keep in mind the rest of the markets, even though we may not have a strong service operation in a lot of other markets around the world, we do sell our completion fluids through the major service providers. Since again, they don't manufacture their own completion fluids, they buy them from companies like Tetra.

So we actually have a pretty strong market presence around international markets around the world, but through the service providers that can probably be a little bit more volatile than the three key markets that I've mentioned and we'll see as we get into the 2026 planning process with our customers. But again, we're Everything we're hearing about the deep water market is is is a multi-year growth story for us.

Josh, the other thing I would add is if you look at our investor deck and our historical results for the completion fluids and product segment, those margins hold up in almost any cycle during COVID, we saw margins improved in 20 during the COVID years over the prior year.

So that business has strong resilient margins even during slower periods.

Absolutely, and then as the follow-up, I just wanted to, maybe you could talk about sandstorm and opportunities in Saudi just as a, how do you see that evolving as potentially a multi-year opportunity? Could you speak to that a bit more?

And is that the type of product and business that is ultimately going to consume more of your capital over the next two to three years? Thanks.

Yeah, absolutely. Yeah, I mean it's very exciting opportunity for us. I mean, we're starting to really see, unconventional activity outside of the US ramp up. As I've mentioned, our Argentina growth, which really was fueled by sandstorm, and our, production testing capabilities.

Is going to double next year compared to this year. It's anticipated to double compared to this year. Now Saudi, we're not seeing that type of growth yet, but having our first award with Sandstorm is a great start because it typically leads to the, growth of other pieces of our business as we've seen in Argentina.

So yeah, we're we're very excited about, getting a foothold into that market with such a key piece of technology that that will be a catalyst for growth force.

Thanks, I'll turn it back.

Again, if you would like to ask a question, press star send the number one on your telephone keypad.

There are no further questions at this time. I will now turn the call back over to Brady Murphy for closing remarks.

Thank you. I appreciate everyone joining us for the call today. Again, despite the current, macro and energy markets on certainly, again, we have very strong convictions and our base business performing to the levels that it is as well as the future outlook, again related to our [12,030] strategy.

So thank you very much for your participation.

We conclude the call.

Ladies and gentlemen, this concludes today's call.

Thank you all for joining. You may now disconnect.