Q1 2024 Cactus Inc Earnings Call Transcript
Key Points
- Cactus Inc (WHD) reported strong sales in Spoolable Technologies, showing growth from the previous quarter due to robust sales to large integrated customers.
- The company's total revenue for Q1 was $274 million with an adjusted EBITDA of $95 million and an adjusted EBITDA margin of 34.8%, demonstrating solid financial performance.
- Cactus Inc (WHD) increased its cash balance to $194 million, indicating strong liquidity and financial health.
- The company paid a quarterly dividend of $0.12 per share, reflecting its ongoing commitment to returning value to shareholders.
- Cactus Inc (WHD) is pursuing expansion plans in the Mideast, targeting a market for surface pressure control equipment that exceeds $0.5 billion annually, which could significantly enhance future revenues.
- The Pressure Control segment saw a revenue decrease of 3% sequentially, primarily due to decreased customer activity, highlighting potential volatility in market demand.
- Operating income and adjusted segment EBITDA in the Pressure Control segment both decreased due to lower operating leverage and margin declines.
- The Spoolable Technologies segment faced increased input costs, which negatively impacted the adjusted EBITDA margin by 240 basis points.
- Cactus Inc (WHD) reported a sequential decrease in GAAP net income from $62 million in the fourth quarter to $50 million in the first quarter, largely due to an increase in the remeasurement of the earn-out liability.
- Despite the increase in cash balance, the company faces challenges with the macroeconomic backdrop providing little optimism for 2024 U.S. activity levels in the oil and gas sector.
Good day, and thank you for standing by, and welcome to the Cactus Q1 2024 earnings conference call. (Operator instructions) Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Alan Boyd, Director of Corporate Development and Investor Relations.
Thank you and good morning. We appreciate you joining us on today's call. Our speakers will be Scott Bender, our Chairman and Chief Executive Officer; and Al Keifer our Interim Chief Financial Officer. Also joining us today are Joel Bender, President; Steven Bender, Chief Operating Officer; Steve Tadlock, CEO of FlexSteel; and Will Marsh, our General Counsel.
Please note that any comments we make on today's call regarding projections or expectations for future events are forward-looking statements covered by the Private Securities Litigation Reform Act. Forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control. These risks and uncertainties can cause
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