Dawson Geophysical Company (DWSN) Q2 2024 earnings summary

Executive summary

• Revenues for Q2 2024 declined 38% year-over-year to $12.5M, mainly due to lower crew utilization and a $5.2M drop in reimbursable revenues.

• Net loss for Q2 2024 was $3.5M ($0.12/share), an improvement from a $4.4M loss in Q2 2023; net income for the first six months of 2024 was $2.3M versus a $4.8M loss in the prior year period.

• U.S. operations reduced to one crew in late May to conserve cash, with plans to redeploy a second crew in Q3 and resume Canadian operations in Q4.

• General and administrative expenses declined 37% year-to-date, supporting improved profitability.

• A special cash dividend of $0.32/share ($9.9M total) was paid in May 2024.

Financial highlights

• Q2 2024 revenues: $12.5M vs. $20.2M in Q2 2023; reimbursable revenue fell to $4.2M from $9.3M.

• Q2 2024 fee revenue: $8.3M (down 23% year-over-year); Canadian fee revenue nearly flat at $5K due to seasonal halt.

• Q2 2024 operating costs: $16.3M, down 35% year-over-year, reflecting cost reduction initiatives and lower crew activity.

• Adjusted EBITDA for Q2 2024 was $(2.3)M; six-month Adjusted EBITDA: $5.3M.

• Cash and equivalents at June 30, 2024: $11.2M; positive working capital of $9.0M.

Outlook and guidance

• Q3 2024 revenue expected to be comparable to Q2, with a significant increase anticipated in Q4 as U.S. and Canadian operations ramp up.

• Activity expected to ramp up in late Q3 2024, with two crews deployed and full equipment utilization through Q2 2025.

• Canadian operations to resume in Q4 2024 after seasonal halt.

• Strategic adjustments in bidding and marketing aim to improve utilization and cash flows.

• Bid activity in the U.S. continues to improve.