Total Energy Services (TOT) Q2 2024 earnings summary

Executive summary

• Achieved record Q2 2024 financial results, driven by stable Canadian and Australian markets, strong North American compression/process equipment demand, and the Saxon Energy Services acquisition, offsetting lower U.S. drilling activity.

• Saxon Energy Services Australia acquisition contributed $19.2 million in Q2 revenue and expanded Australian operations.

• 46% of Q2 revenue from the U.S., 36% from Canada, and 18% from Australia; CPS segment contributed 51% of consolidated revenue.

Financial highlights

• Q2 2024 consolidated revenue rose 2% year-over-year to $213.3 million; consolidated margin improved to 23% from 19%.

• Q2 net income surged 150% year-over-year to $15.5 million; Q2 EBITDA increased 24% year-over-year to $37.4 million; CPS segment EBITDA up 42%.

• Q2 working capital at $71.8 million, including $24.8 million cash; net debt at quarter-end was $29.2 million.

• Diluted EPS for Q2 was $0.39, up from $0.15 last year.

Outlook and guidance

• Optimistic for H2 2024, with Australian investments, Saxon integration, and capital projects expected to drive further growth.

• Three rigs to be reactivated in Q3 and two more in Q4, all under long-term contracts.

• Strong CPS fabrication sales backlog exceeding $200 million, providing visibility into Q1 2025.