Calfrac Well Services Ltd.

Revenue from continuing operations in Q4 2024 was $381.2 million, down 10% year over year, mainly due to lower activity and pricing in the U.S. Adjusted EBITDA was $34.5 million, down 45% year over year, reflecting lower North American utilization, weaker U.S. pricing, and unplanned downtime in Argentina in October. Net loss from continuing operations was $6.4 million versus net income of $13.2 million in Q4 2023; the quarter included a $12.7 million write-off of obsolete U.S. fracturing assets and a one-time depreciation impact tied to salvage value estimates. Capital expenditures were $33 million versus $49.4 million a year ago, and the Board approved a $135 million capital budget for 2025, including about $50 million for Argentina expansion funded locally by cash flow. Year-end working capital from continuing operations was $273.9 million, including $44 million of cash, and net debt to adjusted EBITDA was 1.57. Available credit was $97.1 million after $150 million of borrowings under the revolving term loan facility and $2.9 million used for letters of credit. Management expects Q1 2025 U.S. revenue to be down about 10% year over year, with profitability better than last year but not substantially; Canada is also expected to be down on the top line with profitability holding up, though February cold weather and tariffs may pressure costs.

Pat Powell emphasized safety, fleet modernization, and Argentina growth as the core strategic priorities. He said Calfrac set a 25-year safety record with a TRIF of 0.92, ended 2024 with 66 Tier IV pumps, and expects the equivalent of five Tier IV fleets in North America by the end of Q1. He also highlighted that the second large Argentine fleet started earlier than planned and said he is confident the company can navigate current headwinds and deliver strong returns in 2025.

Michael Olinek focused on the quarter’s weaker financial performance and the balance-sheet position. He cited Q4 revenue of $381.2 million, adjusted EBITDA of $34.5 million, net loss of $6.4 million, and capex of $33 million, noting the $12.7 million asset write-off and the depreciation change affected earnings. He also pointed to $273.9 million of working capital, $44 million of cash, $97.1 million of available credit, and the amended springing maturity date moving from September 15, 2025 to January 15, 2026, which gives flexibility to address second lien note maturities.

Analysts focused on Argentina utilization and contract duration, U.S. pricing, fleet modernization, Appalachia and Bakken demand, and tariff impacts on sand and other inputs. Management said the second Argentine fleet is largely contracted or in the process of being contracted, with utilization expected to be strong, while U.S. pricing may be at or near a bottom but remains competitive, especially for Tier II fleets. They also said the Appalachia work appears to be incremental demand rather than displacing another provider, and that Q1 U.S. revenue is expected to be about 10% lower year over year with modestly better profitability.