Total Energy Services (TOT) Q4 2024 earnings summary

Executive summary

• Q4 2024 revenue rose 15% year-over-year to $246.8M, driven by the Saxon acquisition and strong CPS performance, offsetting lower U.S. drilling and completion activity.

• Net income for Q4 was $10.1M, reversing a $7.9M loss in Q4 2023; full-year net income up 46% to $60.7M.

• EBITDA declined by CAD 4.7 million due to lower U.S. activity, extended Canadian holiday shutdowns, wet weather in Australia, and negative FX impacts.

• 2024 was a record year, with significant free cash flow used for debt reduction and shareholder returns.

• Saxon Energy Services Australia acquisition contributed to results from March 2024.

Financial highlights

• Q4 consolidated gross margin was 23%, down from 27% in Q4 2023.

• Q4 EBITDA decreased 10% to $40.6M; full-year EBITDA up 2% to $171.8M.

• Positive working capital of $78.7M at year-end, including $38.4M in cash.

• Long-term debt and lease liabilities (excluding current portion) decreased 21% to $79.2M; net debt nearly neutral at $0.4M.

• $35.2M returned to shareholders in 2024 via dividends and buybacks.

Outlook and guidance

• Preliminary 2025 capital budget set at $61.9M, with $27.6M for maintenance and $34.3M for upgrades and growth, mainly in Canadian rig upgrades and compression fleet.

• $16.6M of 2024 growth capital carried into 2025, focused on Australian upgrades.

• Board approved an 11% dividend increase, payable April 15, 2025.

• Strong North American demand for compression/process equipment and high bid activity in CPS segment.

• Capital program expected to be funded by cash on hand and operating cash flow.