CES Energy Solutions Corp.

Q2 2026 revenue was $714.1 million, up 24.4% year over year from $574 million. Adjusted EBITDAC was $119.2 million, versus $88.3 million in Q2 2025, and adjusted EBITDAC margin was 16.7% versus 15.4% a year ago. Funds flow from operations was a record $97 million versus $77 million in Q2 2025; cash flow from operations was $60 million versus $66 million, and free cash flow was $25 million versus $35 million. U.S. revenue was $497 million and Canada revenue was $217.1 million. Total debt was $513 million and total debt to adjusted EBITDAC was 1.15x. For 2026, management expects cash CapEx of about $100 million, split evenly between maintenance and expansion capital, and said margins should stay in the higher end of the 15.5% to 16.5% range.

Ken Zinger struck a confident tone, emphasizing that CES is taking share across U.S. and Canadian markets and that the core business is benefiting from stronger activity and more complex wells. He repeatedly pointed to U.S. land production chemicals as the biggest near-term growth engine, while offshore, heavy oil, and international opportunities remain longer-dated and trial-based. He also said current market volatility, including supply chain disruptions and pricing swings tied to Middle East events, has not changed his belief that margins can stay within the stated range.

Tony Aulicino highlighted the quarter’s financial strength, including record revenue of $714 million, adjusted EBITDAC of $119.2 million, and margin of 16.7%. He said the margin was helped by a one-time Canadian project, a weaker Canadian dollar, and some inventory/cost accounting effects, but even excluding those items he suggested margins would still have been within roughly 16% to 16.5%. He also noted record funds flow from operations of $97 million, CapEx of $24 million net of disposals, the $100 million 2026 CapEx plan, and the June refinancing of $300 million of 5 5/8% senior unsecured notes, which lowered annual interest costs by about $2 million and extended maturities to 2033. He reiterated leverage discipline at 1 to 1.5x, with quarter-end debt-to-EBITDAC at 1.15x.

Analysts pressed on why margins were so strong and whether guidance should be raised; management said they prefer not to overpromise because cost and pricing conditions remain volatile, especially due to supply chain disruption and the Middle East conflict. They said the 16.7% margin reflected some one-time benefits, but they still expect margins to land in the higher half of the 15.5% to 16.5% range. Questions also focused on which growth initiatives will come first, and management said U.S. land production chemicals is the clearest and most immediate driver, while offshore and heavy oil are progressing more slowly through trials. On M&A, management said there is no obvious gap in the portfolio, and any deal would need to be strategic and meet their high return and margin standards.