Financial Overview of Mammoth Energy Services, Inc.

Mammoth Energy Services, Inc. is an integrated, growth-oriented energy services company focused on providing products and services to enable the exploration and development of North American onshore unconventional oil and natural gas reserves, as well as the construction and repair of the electric grid. The company operates in four main business segments: well completion services, infrastructure services, natural sand proppant services, and other services.

Revenue and Profit Trends

For the first quarter of 2025, Mammoth Energy Services reported total revenue of $62.5 million, a 45% increase from $43.2 million in the first quarter of 2024. This increase was primarily driven by higher revenue in the well completion services, infrastructure services, and natural sand proppant services segments.

Well completion services revenue increased 161% to $20.9 million, due to an 118% increase in the number of stages completed and higher utilization of the company’s pressure pumping fleets. Infrastructure services revenue grew 23% to $30.7 million, mainly from an increase in average crew count and higher storm restoration activity, partially offset by lower substation revenue. Natural sand proppant services revenue rose 56% to $6.7 million, resulting from a 30% increase in tons of sand sold and $1.6 million of shortfall revenue, despite a 12% decline in average price per ton.

Despite the revenue growth, Mammoth Energy Services reported a net loss of $0.5 million in the first quarter of 2025, an improvement from a net loss of $11.8 million in the same period of 2024. The company’s Adjusted EBITDA, a non-GAAP measure, was $2.7 million in the first quarter of 2025 compared to $4.5 million in the first quarter of 2024.

Segment Performance

Well Completion Services:

• Revenue increased 161% to $20.9 million, driven by an 118% increase in the number of stages completed and higher fleet utilization.
• Cost of revenue, exclusive of depreciation and amortization, increased 138% to $18.8 million, but as a percentage of revenue decreased from 99% to 90%, reflecting improved operational efficiency.
• Adjusted EBITDA was $1.1 million, compared to a loss of $0.9 million in the prior-year period.

Infrastructure Services:

• Revenue increased 23% to $30.7 million, due to more crews and higher storm restoration activity, partially offset by lower substation revenue.
• Cost of revenue, exclusive of depreciation and amortization, increased 18% to $25.4 million, but as a percentage of revenue decreased from 86% to 83%, reflecting the higher-margin storm restoration work.
• Adjusted EBITDA was $1.6 million, down from $8.5 million in the first quarter of 2024, which included $10.5 million of interest on delinquent accounts receivable.

Natural Sand Proppant Services:

• Revenue increased 56% to $6.7 million, driven by a 30% increase in tons of sand sold and $1.6 million of shortfall revenue, partially offset by a 12% decline in average price per ton.
• Cost of revenue, exclusive of depreciation, depletion and accretion, decreased 4% to $5.5 million, and as a percentage of revenue decreased from 133% to 82%, reflecting the higher sales volume and shortfall revenue.
• Adjusted EBITDA was $0.4 million, compared to a loss of $2.4 million in the prior-year period.

Other Services:

• Revenue, which includes directional drilling, aviation, equipment rental, remote accommodations, and equipment manufacturing, decreased 14% to $5.9 million, primarily due to lower equipment manufacturing and remote accommodations revenue.
• Cost of revenue, exclusive of depreciation and amortization, decreased 15% to $5.5 million, and as a percentage of revenue decreased from 94% to 93%.
• Adjusted EBITDA was a loss of $0.4 million, compared to a loss of $0.7 million in the first quarter of 2024.

Strengths and Weaknesses

Strengths:

• Diversified service offerings across the energy value chain, including well completion, infrastructure, and proppant services
• Improved operational efficiency and cost control, as evidenced by the decrease in cost of revenue as a percentage of revenue in several segments
• Strong liquidity position, with $56.7 million in unrestricted cash and $67.5 million in available borrowing capacity under the revolving credit facility as of May 2, 2025

Weaknesses:

• Continued net losses, although improved from the prior-year period
• Reliance on the volatile oil and gas industry, which has faced persistent challenges in recent years
• Potential exposure to the bankruptcy proceedings of PREPA, a significant customer for the infrastructure services segment

Outlook and Future Prospects

Mammoth Energy Services expects 2025 activity levels to be relatively steady, with the potential for upside in the well completion and natural sand proppant services segments driven by incremental demand associated with natural gas. The company believes positive trends, such as LNG export capacity coming online and increased electricity and power demand, could contribute to increased activity.

The company recently completed the sale of a portion of its infrastructure services entities, including its distribution, transmission, and substation operations, for $108.7 million. Mammoth believes this transaction will be accretive for its shareholders and that the increased cash position will allow it to explore opportunities to deploy capital at accretive returns.

However, the company continues to face external challenges in the current economic environment, including persistent weakness in the natural gas basins in which it operates and macroeconomic uncertainty. Mammoth remains disciplined with its spending and is focused on improving operational efficiencies and its cost structure to enhance value for its shareholders.

Overall, Mammoth Energy Services’ financial performance in the first quarter of 2025 showed signs of improvement, with increased revenue and a narrower net loss compared to the prior-year period. The company’s diversified service offerings, focus on operational efficiency, and recent divestiture of infrastructure assets position it to navigate the challenges in the energy industry and potentially capitalize on future growth opportunities.