Liberty Oilfield Services Inc. (NYSE: LBRT; “Liberty”) announced
today first quarter 2018 financial and operational results.
Summary Results and Highlights
- Revenue of $495 million and net income
of $54 million1 for the first quarter of 2018
- Adjusted EBITDA of $100 million2 and
annualized adjusted EBITDA per average active fleet of $20.4
million for the first quarter of 2018
Message from Chris Wright, CEO
“We are proud of our first quarter results. The Liberty team
came together to deliver record revenue and Adjusted EBITDA despite
significant operational challenges arising from unusual winter
weather and sand logistics issues during the first quarter.
“We are excited for the remainder of 2018. The frac market
remains strong and in partnership with our customers we continue to
drive increases in throughput across our entire fleet. The second
quarter is off to a great start and we expect results for this
period will surpass our Adjusted EBITDA per average active fleet
from last year’s third quarter.
“In the Permian, we are pleased with our deepening customer
relationships and the results we are seeing. During the first
quarter, we deployed our sixth Permian fleet under a dedicated
arrangement. The Permian market remains tight for top tier,
high-efficiency frac fleets, and pricing is strong. More
importantly, we are seeing meaningful throughput and efficiency
gains across our fleets in the basin.”
Fleet Deployment Update
During the first quarter of 2018, Liberty deployed fleets 20 and
21 under dedicated arrangements with existing customers. Liberty
has staffed fleet 22 and is on schedule to deploy that fleet on a
dedicated basis at the end of the second quarter of 2018. As
previously announced, Liberty anticipates fleets 23 and 24 will be
delivered at the end of the third and fourth quarters of 2018 under
dedicated arrangements.
__________________________
1 Net income attributable to Predecessor, controlling and
noncontrolling interests 2 “Adjusted EBITDA” is not presented in
accordance with generally accepted accounting principles in the
United States (“U.S. GAAP”). Please see the supplemental financial
information in the table under “Reconciliation of Net Income to
EBITDA and Adjusted EBITDA” at the end of this earnings release for
a reconciliation of the non-GAAP financial measure of Adjusted
EBITDA to its most directly comparable GAAP financial measure.
First Quarter 2018 Results
For the first quarter of 2018, revenue grew 10% to $495 million
from $449 million in the fourth quarter of 2017.
Net income totaled $54 million1 in the first quarter compared to
net income of $58 million in the fourth quarter. First quarter
results included a $3 million one-time, non-recurring expense
related to the early retirement of debt in conjunction with our
initial public offering. First quarter income tax expense totaled
$8 million. Liberty was not subject to income tax prior to its
initial public offering.
Adjusted EBITDA increased 9% to $100 million from $92 million in
the fourth quarter. Annualized adjusted EBITDA per average active
fleet increased to $20.4 million in the first quarter compared to
$20.2 million in the fourth quarter. Please refer to the
reconciliation of adjusted EBITDA (a non-GAAP measure) to net
income (a GAAP measure) in this release.
For the trailing twelve-months ended March 31, 2018, the Pre-Tax
Return on Capital Employed (“ROCE”) was 39%. Please refer to the
calculation of ROCE in this release.
Balance Sheet and Liquidity
As of March 31, 2018, Liberty had cash on hand of $98 million
and total debt of $107 million, net of discount. There were no
borrowings drawn on the ABL credit facility, and total liquidity
including availability under the credit facility was $311 million.
On January 17, 2018, Liberty completed its initial public offering
of approximately 14.6 million shares of its Class A common stock at
a price of $17.00 per share.
Conference Call
Liberty will host a conference call to discuss the results at
8:00 a.m. Mountain Time (10:00 a.m. Eastern Time) on Tuesday, May
8, 2018. Presenting Liberty’s results will be Chris Wright, Chief
Executive Officer, Ron Gusek, President and Michael Stock, Chief
Financial Officer.
Individuals wishing to participate in the conference call should
dial (866) 807-9684, or for international callers (412) 317-5415.
Participants should ask to join Liberty's call. A live webcast will
be available at http://investors.libertyfrac.com. The webcast can
be accessed for 90 days following the call. A telephone replay will
be available shortly after the call and can be accessed by dialing
(877) 344-7529, or for international callers (412) 317-0088. The
passcode for the replay is 10119425. The replay will be available
until May 15, 2018.
About Liberty Oilfield Services Inc.
Liberty is an independent provider of hydraulic fracturing
services to onshore oil and natural gas exploration and production
companies in North America. Liberty was founded in 2011 with a
relentless focus on improving tight-oil completions, and an
emphasis on customer partnerships and technology to find innovative
answers to frac optimization. Liberty is headquartered in Denver,
Colorado. For more information about Liberty or this event, please
contact Investor Relations at IR@libertyfrac.com.
Non-GAAP Financial Measures
This press release includes unaudited non-GAAP financial
measures, including EBITDA, Adjusted EBITDA and Pre-Tax Return on
Capital Employed. We believe that the presentation of EBITDA and
Adjusted EBITDA are useful because they allow the evaluation of our
operating performance and compares the results of our operations
from period to period without regard to our financing methods or
capital structure. We believe that the presentation of Pre-Tax
Return on Capital Employed allows the evaluation of our investment
returns on capital and our effectiveness in deploying our assets.
Non-GAAP financial measures do not have any standardized meaning
and are therefore unlikely to be comparable to similar measures
presented by other companies. The presentation of non-GAAP
financial measures is not intended to be a substitute for, and
should not be considered in isolation from, the financial measures
reported in accordance with GAAP. See the tables entitled
“Reconciliation and Calculation of Non-GAAP Financial and
Operational Measures” for a reconciliation or calculation of the
non-GAAP financial or operational measures to the most directly
comparable GAAP measure.
Forward-Looking and Cautionary Statements
The information above includes “forward-looking statements”
within the meaning of the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended. All statements, other than statements of
historical facts, included herein concerning, among other things,
the deployment of fleets in the future, Adjusted EBITDA per average
active fleet in future quarters, planned capital expenditures,
future cash flows and borrowings, pursuit of potential acquisition
opportunities, our financial position, business strategy and
objectives for future operations, are forward-looking statements.
These forward-looking statements are identified by their use of
terms and phrases such as “may,” “expect,” “estimate,” “project,”
“plan,” “believe,” “intend,” “achievable,” “anticipate,” “will,”
“continue,” “potential,” “should,” “could,” and similar terms and
phrases. Although we believe that the expectations reflected in
these forward-looking statements are reasonable, they do involve
certain assumptions, risks and uncertainties. These forward-looking
statements represent our expectations or beliefs concerning future
events, and it is possible that the results described in this press
release will not be achieved. These forward-looking statements are
subject to certain risks, uncertainties and assumptions identified
above or as disclosed from time to time in Liberty's filings with
the Securities and Exchange Commission. As a result of these
factors, actual results may differ materially from those indicated
or implied by such forward-looking statements.
Any forward-looking statement speaks only as of the date on
which it is made, and, except as required by law, we do not
undertake any obligation to update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise. New factors emerge from time to time, and it is not
possible for us to predict all such factors. When considering these
forward-looking statements, you should keep in mind the risk
factors and other cautionary statements in the “Risk Factors”
section of Liberty’s Annual Report for the year ended December 31,
2017 and in our other public filings with the SEC. These and other
factors could cause our actual results to differ materially from
those contained in any forward-looking statement.
Liberty Oilfield Services
Inc.Selected Financial Data
(unaudited)
Three Months Ended March 31,
December 31, March 31, 2018
2017 2017 Statement of Income Data:
(amounts in thousands, except for fleet data) Revenue $
495,160 $ 448,883 $ 252,394 Costs of services, excluding
depreciation and amortization shown separately 376,827 339,315
211,633 General and administrative 21,677 20,738 17,084
Depreciation and amortization 28,016 25,642 14,146 Loss (gain) on
disposal of assets 80 160 (43 )
Total operating expenses 426,600 385,855 242,820 Operating income
68,560 63,028 9,574 Interest expense (6,494 ) (5,347
) (1,452 ) Net income before taxes 62,066 57,681 8,122
Income tax expense 8,079 — —
Net income attributable to Predecessor, controlling and
noncontrolling interests $ 53,987 $ 57,681 $ 8,122 Less: Net income
attributable to Liberty LLC, prior to Corporate Reorganization
8,705 57,681 8,122 Less: Net income attributable to noncontrolling
interests 21,607 - - Net
income attributable to Liberty Oilfield Services Inc. stockholders
$ 23,675 $ - $ -
Other
Financial and Operational Data Capital expenditures $ 82,867 $
60,255 $ 136,524 Adjusted EBITDA (1) $ 100,167 $ 91,753 $ 30,437
Total Fleets at beginning of period (2) 19.0 17.0 10.0 Total Fleets
at end of period (2) 21.0 19.0 12.0 Average Active Fleets (3) 19.9
18.0 11.4 Annualized Adjusted EBITDA per Average Active Fleet (4) $
20,414 $ 20,223 $ 10,828
__________________________
(1) Adjusted EBITDA is a non-GAAP financial measures. See
the tables entitled "Reconciliation and Calculation of Non-GAAP
Financial and Operational Measures" below. (2) Total Fleets
represents the number of deployed and active fleets as of the
designated date. (3) Average Active Fleets is calculated as the
daily average of the number of active fleets for the period
presented. (4) Annualized Adjusted EBITDA per Average Active Fleet
is calculated as Adjusted EBITDA for the respective quarter
annualized, divided by the Average Active Fleets, as defined above.
Liberty Oilfield Services Inc. Condensed
Consolidated and Combined Balance Sheets (unaudited, amounts in
thousands)
March 31, December
31, 2018 2017 Assets Current assets: Cash
and cash equivalents $ 98,070 $ 16,321 Accounts receivable and
unbilled revenue 293,527 258,788 Inventories 60,072 55,524 Prepaids
and other current assets 26,847 21,396 Total current assets
478,516 352,029 Property and equipment, net 549,297 494,776
Other assets 11,113 5,298 Total assets $ 1,038,926 $
852,103
Liabilities and Equity Current liabilities: Accounts
payable $ 139,084 $ 66,846 Accrued liabilities 110,699 153,648
Current portion of long-term debt, net of discount 370 11
Total current liabilities 250,153 220,505 Long-term debt, net of
discount 106,905 196,346 Deferred tax liability 28,657 — Payable
pursuant to tax receivable agreement 2,291 — Total
liabilities 388,006 416,851 Redeemable common units —
42,486 Member equity — 392,766 Stockholders' equity: Common Stock
1,182 — Additional paid in capital 347,965 — Retained earnings
23,675 — Total stockholders' equity 372,822 — Noncontrolling
interest 278,098 — Total Equity 650,920 435,252 Total
liabilities and equity $ 1,038,926 $ 852,103
Liberty Oilfield Services Inc. Reconciliation and
Calculation of Non-GAAP Financial and Operational Measures
(unaudited, amounts in thousands)
Reconciliation of Net
Income to EBITDA and Adjusted EBITDA Three
Months Ended March 31, December 31,
March 31, 2018 2017 2017
Net income attributable to Predecessor, controlling and
noncontrolling interest $ 53,987 $ 57,681 $ 8,122 Depreciation and
amortization 28,016 25,642 14,146 Interest expense 6,494 5,347
1,452 Income tax expense 8,079 — — EBITDA $
96,576 $ 88,670 $ 23,720 Fleet start-up costs 3,309 3,171 4,612
Asset acquisition costs — (498 ) 1,354 Loss (gain) on disposal of
assets 80 160 (43 ) Advisory services fees 202 250
794 Adjusted EBITDA $ 100,167 $ 91,753 $
30,437
Calculation of Pre-Tax Return on Capital
Employed Twelve Months Ended March
31, 2018 2017 Net income
attributable to Predecessor, controlling and noncontrolling
interest $ 214,366 Add back: Income tax expense 8,079
Pre-tax net income $ 222,445 Capital Employed Total debt, net of
discount $ 107,275 $ 105,914 Redeemable common units — 40,197 Total
equity 650,920 236,691 Total Capital Employed $ 758,195
$ 382,802 Average Capital Employed (1) $ 570,499
Pre-Tax Return on Capital Employed (2) 39 % (1) Average
Capital Employed is the simple average of Total Capital Employed as
of March 31, 2018 and 2017. (2) Pre-tax Return on Capital Employed
is the ratio of pre-tax net income for the twelve months ended
March 31, 2018 to Average Capital Employed.
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version on businesswire.com: https://www.businesswire.com/news/home/20180507006124/en/
Liberty Oilfield Services Inc.Michael Stock,
303-515-2851Chief Financial OfficerIR@libertyfrac.comorDamon
Overal, 303-515-2851Head of Investor
RelationsIR@libertyfrac.com
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