Flowco (FLOC) Barclays 39th Annual CEO Energy-Power Conference 2025 summary

Company overview and business model

• Focuses exclusively on production optimization and artificial lift for oil and gas wells, with no exposure to drilling or fracking expenses.

• Holds number one market position in all product lines, serving over 200 customers and operating in every major U.S. basin.

• Vertically integrated with domestic manufacturing and a largely domestic supply chain, minimizing tariff impacts.

• Formed from the merger of three production-focused companies about 18 months ago, now organized into two divisions: Production Solutions and Natural Gas Technologies.

• Recurring revenue streams and a stable, loyal workforce of about 1,300 employees.

Market dynamics and growth strategy

• Producer operating expenses are projected to grow at a 4% CAGR despite flat production, due to the need to manage more wellbores over time.

• The company is present throughout the well lifecycle, offering technologies for early, mature, and late-stage production.

• U.S. addressable market for artificial lift is about $3.5 billion, with the company leading in all niches and pursuing organic growth.

• High-pressure gas lift (HPGL) technology, invented six years ago, has grown to 800 units and 60 customers, capturing about 20% of the addressable market.

• Recent acquisition of 155 units from Archrock expanded the fleet and customer base, reinforcing sector leadership.

Product innovation and competitive advantages

• HPGL systems are displacing legacy ESPs, offering 99.6% uptime versus 92% for ESPs, and are suitable for shale production environments.

• Only about half of ESP demand is addressable by HPGL due to specific well conditions; current market share is around 20% and growing.

• Once customers adopt HPGL where appropriate, retention is high with no reversions to ESPs.

• Vapor recovery units (VRUs) capture methane and NGLs, providing both environmental and commercial benefits, with about 50% U.S. market share and 2,500+ systems on rent.

• VRUs deliver rapid payback and are not significantly impacted by low natural gas prices due to high BTU content of captured vapors.