Flowco Holdings Inc.

Second quarter total revenue increased 13% sequentially to $236 million. Adjusted EBITDA was approximately $94 million, or $93.9 million, with adjusted EBITDA margins of roughly 40%. Production Solutions revenue increased 22% sequentially to $171 million and adjusted segment EBITDA increased approximately 16% to $71 million. Natural Gas Technology revenue and adjusted segment EBITDA each decreased 6% sequentially to approximately $65 million and $28 million. Free cash flow was approximately $50 million, capex was $45 million, and annualized adjusted return on capital employed was approximately 18%. As of August 7, Flowco had about $274 million of borrowings outstanding under its credit facility, $722 million of borrowing base, and about $446 million of available capacity. For Q3, management guided adjusted EBITDA to $92 million to $98 million. Management said the full-year capital outlook remains unchanged.

Joe Bob Edwards emphasized that Flowco delivered profitable growth while staying focused on service quality, execution, and free cash flow generation. He highlighted Valiant as a key strategic addition that broadens the production optimization platform and improves cross-sell opportunities across the life of the well. His tone was constructive and confident, with repeated comments that Flowco is well positioned to benefit from non-discretionary production optimization spending.

Jon Byers said Q2 performance was within the original guidance range, supported by growth in high-margin rental businesses and a full quarter of Valiant contribution. He noted modest margin pressure from higher operating and maintenance expenses in Production Solutions, including lubricant and fuel costs, and said those pressures are expected to continue into Q3 and are included in guidance. He also detailed strong cash generation of about $50 million versus $45 million of capital investment, said leverage moved further below 1x, and pointed to about $274 million of borrowings against $722 million of borrowing base with roughly $446 million of available capacity. He said the board approved a $0.14 per-share one-time special dividend to Class A shareholders, in addition to the quarterly discretionary dividend of $0.09, and said no similar special dividends are expected in the future.

Analysts focused on Valiant’s progress, asking whether the acquisition is ahead of plan and where cross-selling and international opportunities could emerge. Management said integration is substantially complete, customer expansion is underway, and the guidance looks “eminently achievable,” but declined to give a more specific update until later in the year. Questions also centered on cost inflation, especially lube oil; management said Q3 pricing is already largely locked in, contracts limit pass-through, and operating and maintenance expense is a bigger medium-term lever for improvement. Analysts also asked about AI in artificial lift and VRU demand; management said AI-enabled monitoring and predictive maintenance is still early and customer adoption will be uneven, while VRU demand remains supported by Permian standardization, takeaway improvements, and in-basin power.