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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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32-0498321
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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14201 Caliber Drive Suite 300
Oklahoma City, Oklahoma |
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73134
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
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Accelerated filer
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Non-accelerated filer
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Smaller reporting company
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Emerging growth company
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ý
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Page
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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Item 1A.
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Item 2.
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Item 4.
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Item 5.
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Item 6.
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The following is a glossary of certain oil and natural gas industry terms used in this report:
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Acidizing
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To pump acid into a wellbore to improve a well's productivity or injectivity.
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Blowout
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An uncontrolled flow of reservoir fluids into the wellbore, and sometimes catastrophically to the surface. A blowout may consist of salt water, oil, natural gas or a mixture of these. Blowouts can occur in all types of exploration and production operations, not just during drilling operations. If reservoir fluids flow into another formation and do not flow to the surface, the result is called an underground blowout. If the well experiencing a blowout has significant open-hole intervals, it is possible that the well will bridge over (or seal itself with rock fragments from collapsing formations) down-hole and intervention efforts will be averted.
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Bottomhole assembly
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The lower portion of the drillstring, consisting of (from the bottom up in a vertical well) the bit, bit sub, a mud motor (in certain cases), stabilizers, drill collar, heavy-weight drillpipe, jarring devices (“jars”) and crossovers for various threadforms. The bottomhole assembly must provide force for the bit to break the rock (weight on bit), survive a hostile mechanical environment and provide the driller with directional control of the well. Oftentimes the assembly includes a mud motor, directional drilling and measuring equipment, measurements-while-drilling tools, logging-while-drilling tools and other specialized devices.
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Cementing
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To prepare and pump cement into place in a wellbore.
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Coiled tubing
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A long, continuous length of pipe wound on a spool. The pipe is straightened prior to pushing into a wellbore and rewound to coil the pipe back onto the transport and storage spool. Depending on the pipe diameter (1 in. to 4 1/2 in.) and the spool size, coiled tubing can range from 2,000 ft. to 23,000 ft. (610 m to 6,096 m) or greater length.
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Completion
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A generic term used to describe the assembly of down-hole tubulars and equipment required to enable safe and efficient production from an oil or gas well. The point at which the completion process begins may depend on the type and design of the well.
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Directional drilling
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The intentional deviation of a wellbore from the path it would naturally take. This is accomplished through the use of whipstocks, bottomhole assembly (BHA) configurations, instruments to measure the path of the wellbore in three-dimensional space, data links to communicate measurements taken down-hole to the surface, mud motors and special BHA components and drill bits, including rotary steerable systems, and drill bits. The directional driller also exploits drilling parameters such as weight on bit and rotary speed to deflect the bit away from the axis of the existing wellbore. In some cases, such as drilling steeply dipping formations or unpredictable deviation in conventional drilling operations, directional-drilling techniques may be employed to ensure that the hole is drilled vertically. While many techniques can accomplish this, the general concept is simple: point the bit in the direction that one wants to drill. The most common way is through the use of a bend near the bit in a down-hole steerable mud motor. The bend points the bit in a direction different from the axis of the wellbore when the entire drillstring is not rotating. By pumping mud through the mud motor, the bit turns while the drillstring does not rotate, allowing the bit to drill in the direction it points. When a particular wellbore direction is achieved, that direction may be maintained by rotating the entire drillstring (including the bent section) so that the bit does not drill in a single direction off the wellbore axis, but instead sweeps around and its net direction coincides with the existing wellbore. Rotary steerable tools allow steering while rotating, usually with higher rates of penetration and ultimately smoother boreholes.
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Down-hole
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Pertaining to or in the wellbore (as opposed to being on the surface).
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Down-hole motor
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A drilling motor located in the drill string above the drilling bit powered by the flow of drilling mud. Down-hole motors are used to increase the speed and efficiency of the drill bit or can be used to steer the bit in directional drilling operations. Drilling motors have become very popular because of horizontal and directional drilling applications and the day rates for drilling rigs.
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Drilling rig
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The machine used to drill a wellbore.
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Drillpipe or Drill pipe
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Tubular steel conduit fitted with special threaded ends called tool joints. The drillpipe connects the rig surface equipment with the bottomhole assembly and the bit, both to pump drilling fluid to the bit and to be able to raise, lower and rotate the bottomhole assembly and bit.
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Drillstring or Drill string
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The combination of the drillpipe, the bottomhole assembly and any other tools used to make the drill bit turn at the bottom of the wellbore.
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Horizontal drilling
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A subset of the more general term “directional drilling,” used where the departure of the wellbore from vertical exceeds about 80 degrees. Note that some horizontal wells are designed such that after reaching true 90-degree horizontal, the wellbore may actually start drilling upward. In such cases, the angle past 90 degrees is continued, as in 95 degrees, rather than reporting it as deviation from vertical, which would then be 85 degrees. Because a horizontal well typically penetrates a greater length of the reservoir, it can offer significant production improvement over a vertical well.
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Hydraulic fracturing
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A stimulation treatment routinely performed on oil and gas wells in low permeability reservoirs. Specially engineered fluids are pumped at high pressure and rate into the reservoir interval to be treated, causing a vertical fracture to open. The wings of the fracture extend away from the wellbore in opposing directions according to the natural stresses within the formation. Proppant, such as grains of sand of a particular size, is mixed with the treatment fluid to keep the fracture open when the treatment is complete. Hydraulic fracturing creates high-conductivity communication with a large area of formation and bypasses any damage that may exist in the near-wellbore area.
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Hydrocarbon
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A naturally occurring organic compound comprising hydrogen and carbon. Hydrocarbons can be as simple as methane, but many are highly complex molecules, and can occur as gases, liquids or solids. Petroleum is a complex mixture of hydrocarbons. The most common hydrocarbons are natural gas, oil and coal.
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Mesh size
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The size of the proppant that is determined by sieving the proppant through screens with uniform openings corresponding to the desired size of the proppant. Each type of proppant comes in various sizes, categorized as mesh sizes, and the various mesh sizes are used in different applications in the oil and natural gas industry. The mesh number system is a measure of the number of equally sized openings per square inch of screen through which the proppant is sieved.
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Mud motors
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A positive displacement drilling motor that uses hydraulic horsepower of the drilling fluid to drive the drill bit. Mud motors are used extensively in directional drilling operations.
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Natural gas liquids
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Components of natural gas that are liquid at surface in field facilities or in gas processing plants. Natural gas liquids can be classified according to their vapor pressures as low (condensate), intermediate (natural gasoline) and high (liquefied petroleum gas) vapor pressure.
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Nitrogen pumping unit
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A high-pressure pump or compressor unit capable of delivering high-purity nitrogen gas for use in oil or gas wells. Two basic types of units are commonly available: a nitrogen converter unit that pumps liquid nitrogen at high pressure through a heat exchanger or converter to deliver high-pressure gas at ambient temperature, and a nitrogen generator unit that compresses and separates air to provide a supply of high pressure nitrogen gas.
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Plugging
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The process of permanently closing oil and gas wells no longer capable of producing in economic quantities. Plugging work can be performed with a well servicing rig along with wireline and cementing equipment; however, this service is typically provided by companies that specialize in plugging work.
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Plug
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A down-hole packer assembly used in a well to seal off or isolate a particular formation for testing, acidizing, cementing, etc.; also a type of plug used to seal off a well temporarily while the wellhead is removed.
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Pounds per square inch
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A unit of pressure. It is the pressure resulting from a one pound force applied to an area of one square inch.
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Pressure pumping
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Services that include the pumping of liquids under pressure.
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Producing formation
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An underground rock formation from which oil, natural gas or water is produced. Any porous rock will contain fluids of some sort, and all rocks at considerable distance below the Earth’s surface will initially be under pressure, often related to the hydrostatic column of ground waters above the reservoir. To produce, rocks must also have permeability, or the capacity to permit fluids to flow through them.
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Proppant
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Sized particles mixed with fracturing fluid to hold fractures open after a hydraulic fracturing treatment. In addition to naturally occurring sand grains, man-made or specially engineered proppants, such as resin-coated sand or high-strength ceramic materials like sintered bauxite, may also be used. Proppant materials are carefully sorted for size and sphericity to provide an efficient conduit for production of fluid from the reservoir to the wellbore.
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Resource play
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Accumulation of hydrocarbons known to exist over a large area.
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Shale
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A fine-grained, fissile, sedimentary rock formed by consolidation of clay- and silt-sized particles into thin, relatively impermeable layers.
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Tight oil
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Conventional oil that is found within reservoirs with very low permeability. The oil contained within these reservoir rocks typically will not flow to the wellbore at economic rates without assistance from technologically advanced drilling and completion processes. Commonly, horizontal drilling coupled with multistage fracturing is used to access these difficult to produce reservoirs.
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Tight sands
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A type of unconventional tight reservoir. Tight reservoirs are those which have low permeability, often quantified as less than 0.1 millidarcies.
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Tubulars
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A generic term pertaining to any type of oilfield pipe, such as drill pipe, drill collars, pup joints, casing, production tubing and pipeline.
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Unconventional resource
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An umbrella term for oil and natural gas that is produced by means that do not meet the criteria for conventional production. What has qualified as “unconventional” at any particular time is a complex function of resource characteristics, the available exploration and production technologies, the economic environment, and the scale, frequency and duration of production from the resource. Perceptions of these factors inevitably change over time and often differ among users of the term. At present, the term is used in reference to oil and gas resources whose porosity, permeability, fluid trapping mechanism, or other characteristics differ from conventional sandstone and carbonate reservoirs. Coalbed methane, gas hydrates, shale gas, fractured reservoirs and tight gas sands are considered unconventional resources.
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Wellbore
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The physical conduit from surface into the hydrocarbon reservoir.
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Well stimulation
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A treatment performed to restore or enhance the productivity of a well. Stimulation treatments fall into two main groups, hydraulic fracturing treatments and matrix treatments. Fracturing treatments are performed above the fracture pressure of the reservoir formation and create a highly conductive flow path between the reservoir and the wellbore. Matrix treatments are performed below the reservoir fracture pressure and generally are designed to restore the natural permeability of the reservoir following damage to the near wellbore area. Stimulation in shale gas reservoirs typically takes the form of hydraulic fracturing treatments.
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Wireline
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A general term used to describe well-intervention operations conducted using single-strand or multi-strand wire or cable for intervention in oil or gas wells. Although applied inconsistently, the term commonly is used in association with electric logging and cables incorporating electrical conductors.
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Workover
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The process of performing major maintenance or remedial treatments on an oil or gas well. In many cases, workover implies the removal and replacement of the production tubing string after the well has been killed and a workover rig has been placed on location. Through-tubing workover operations, using coiled tubing, snubbing or slickline equipment, are routinely conducted to complete treatments or well service activities that avoid a full workover where the tubing is removed. This operation saves considerable time and expense.
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The following is a glossary of certain electrical infrastructure industry terms used in this report:
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Distribution
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The distribution of electricity from the transmission system to individual customers.
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Substation
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A part of an electrical transmission and distribution system that transforms voltage from high to low, or the reverse.
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Transmission
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The movement of electrical energy from a generating site, such as a power plant, to an electric substation.
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•
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business strategy;
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•
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pending or future acquisitions and future capital expenditures;
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•
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ability to obtain permits and governmental approvals;
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•
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technology;
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•
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financial strategy;
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•
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future operating results; and
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•
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plans, objectives, expectations and intentions.
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Three Months Ended June 30,
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Six Months Ended June 30,
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2018
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2017
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2018
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2017
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||||||||
REVENUE
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(in thousands, except per share amounts)
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Services revenue
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$
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455,545
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$
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29,659
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$
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864,204
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$
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56,751
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Services revenue - related parties
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40,611
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44,603
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89,699
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77,565
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||||
Product revenue
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27,708
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10,395
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52,748
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13,767
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Product revenue - related parties
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9,730
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13,605
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21,192
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25,145
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Total revenue
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533,594
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98,262
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1,027,843
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173,228
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COST AND EXPENSES
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Services cost of revenue (exclusive of depreciation, depletion, amortization and accretion of $26,898, $51,473, $17,651 and $33,489, respectively, for the three and six months ended June 30, 2018 and three and six months ended June 30, 2017)
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302,283
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|
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57,104
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593,262
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|
102,565
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||||
Services cost of revenue - related parties (exclusive of depreciation, depletion, amortization and accretion of $0, $0, $0 and $0, respectively, for the three and six months ended June 30, 2018 and three and six months ended June 30, 2017)
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2,428
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|
262
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|
|
4,220
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|
692
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Product cost of revenue (exclusive of depreciation, depletion, amortization and accretion of $3,879, $6,193, $2,204 and $3,566, respectively, for the three and six months ended June 30, 2018 and three and six months ended June 30, 2017)
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35,117
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19,974
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68,447
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32,581
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|
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Selling, general and administrative (Note 12)
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64,595
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7,393
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102,677
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13,806
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Selling, general and administrative - related parties
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532
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|
307
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961
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|
631
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|
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Depreciation, depletion, amortization and accretion
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30,795
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|
19,893
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57,703
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|
37,130
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|
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Impairment of long-lived assets
|
187
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|
—
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|
187
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|
|
—
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|
||||
Total cost and expenses
|
435,937
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|
|
104,933
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|
|
827,457
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|
|
187,405
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|
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Operating income (loss)
|
97,657
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(6,671
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)
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|
200,386
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(14,177
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)
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||||
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OTHER (EXPENSE) INCOME
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|
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Interest expense, net
|
(959
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)
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|
(1,112
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)
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|
(2,196
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)
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|
(1,509
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)
|
||||
Bargain purchase gain, net of tax
|
—
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4,012
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—
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4,012
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|
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Other, net
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(486
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)
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(203
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)
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(514
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)
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(387
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)
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Total other (expense) income
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(1,445
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)
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|
2,697
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(2,710
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)
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2,116
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Income (loss) before income taxes
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96,212
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(3,974
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)
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197,676
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(12,061
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)
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Provision (benefit) for income taxes
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53,512
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(2,804
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)
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99,430
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(5,910
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)
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||||
Net income (loss)
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$
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42,700
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|
$
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(1,170
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)
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$
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98,246
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|
$
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(6,151
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)
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||||||||
OTHER COMPREHENSIVE INCOME (LOSS)
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Foreign currency translation adjustment, net of tax of $86, $272, $434 and $454, respectively, for the three and six months ended June 30, 2018 and three and six months ended June 30, 2017
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(325
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)
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181
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|
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(786
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)
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|
409
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|
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Comprehensive income (loss)
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$
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42,375
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$
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(989
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)
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|
$
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97,460
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|
|
$
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(5,742
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)
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||||||||
Net income (loss) per share (basic) (Note 14)
|
$
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0.95
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|
$
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(0.03
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)
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|
$
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2.20
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|
|
$
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(0.16
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)
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Net income (loss) per share (diluted) (Note 14)
|
$
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0.95
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|
$
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(0.03
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)
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|
$
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2.18
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|
$
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(0.16
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)
|
Weighted average number of shares outstanding (basic) (Note 14)
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44,737
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|
39,500
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|
|
44,700
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|
|
38,506
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|
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Weighted average number of shares outstanding (diluted) (Note 14)
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45,059
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|
39,500
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|
|
44,977
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|
|
38,506
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||||||||
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|
|||||||||||||
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Retained
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Additional
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|
|||||||||||||
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Common Stock
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Members'
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Earnings
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Paid-In
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|
||||||||||||||
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Shares
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Amount
|
Equity
|
(Deficit)
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Capital
|
AOCL
|
Total
|
|||||||||||||
|
(in thousands)
|
|||||||||||||||||||
Balance at January 1, 2017
|
37,500
|
|
$
|
375
|
|
$
|
81,739
|
|
$
|
(56,323
|
)
|
$
|
400,206
|
|
$
|
(3,216
|
)
|
$
|
422,781
|
|
Net income of Sturgeon prior to acquisition
|
—
|
|
—
|
|
640
|
|
—
|
|
—
|
|
—
|
|
640
|
|
||||||
Stingray acquisition
|
1,393
|
|
14
|
|
—
|
|
—
|
|
25,748
|
|
—
|
|
25,762
|
|
||||||
Sturgeon acquisition
|
5,607
|
|
56
|
|
(82,379
|
)
|
—
|
|
78,313
|
|
—
|
|
(4,010
|
)
|
||||||
Stock based compensation
|
89
|
|
1
|
|
—
|
|
—
|
|
3,743
|
|
—
|
|
3,744
|
|
||||||
Net income
|
—
|
|
—
|
|
—
|
|
58,324
|
|
—
|
|
—
|
|
58,324
|
|
||||||
Other comprehensive income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
555
|
|
555
|
|
||||||
Balance at December 31, 2017
|
44,589
|
|
$
|
446
|
|
$
|
—
|
|
$
|
2,001
|
|
$
|
508,010
|
|
$
|
(2,661
|
)
|
$
|
507,796
|
|
Equity based compensation (Note 15)
|
—
|
|
—
|
|
—
|
|
—
|
|
17,487
|
|
—
|
|
17,487
|
|
||||||
Stock based compensation
|
164
|
|
2
|
|
—
|
|
—
|
|
2,924
|
|
—
|
|
2,926
|
|
||||||
Net income
|
—
|
|
—
|
|
—
|
|
98,246
|
|
—
|
|
—
|
|
98,246
|
|
||||||
Other comprehensive loss
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
(786
|
)
|
(786
|
)
|
|||||||
Balance at June 30, 2018
|
44,753
|
|
$
|
448
|
|
$
|
—
|
|
$
|
100,247
|
|
$
|
528,421
|
|
$
|
(3,447
|
)
|
$
|
625,669
|
|
|
Six Months Ended June 30,
|
||||||
|
2018
|
|
2017
|
||||
|
(in thousands)
|
||||||
Cash flows from operating activities:
|
|
|
|
||||
Net income (loss)
|
$
|
98,246
|
|
|
$
|
(6,151
|
)
|
Adjustments to reconcile net income (loss) to cash provided by operating activities:
|
|
|
|
||||
Equity based compensation (Note 15)
|
17,487
|
|
|
—
|
|
||
Stock based compensation
|
2,916
|
|
|
1,620
|
|
||
Depreciation, depletion, accretion and amortization
|
57,703
|
|
|
37,130
|
|
||
Amortization of coil tubing strings
|
1,120
|
|
|
1,046
|
|
||
Amortization of debt origination costs
|
199
|
|
|
199
|
|
||
Bad debt expense
|
53,790
|
|
|
19
|
|
||
(Gain) loss on disposal of property and equipment
|
(128
|
)
|
|
127
|
|
||
Gain on bargain purchase
|
—
|
|
|
(4,012
|
)
|
||
Impairment of long-lived assets
|
187
|
|
|
—
|
|
||
Deferred income taxes
|
(27,906
|
)
|
|
(6,529
|
)
|
||
Changes in assets and liabilities, net of acquisitions of businesses:
|
|
|
|
||||
Accounts receivable, net
|
(122,908
|
)
|
|
(4,793
|
)
|
||
Receivables from related parties
|
3,114
|
|
|
(12,995
|
)
|
||
Inventories
|
4,156
|
|
|
(4,932
|
)
|
||
Prepaid expenses and other assets
|
(1,195
|
)
|
|
1,528
|
|
||
Accounts payable
|
34,186
|
|
|
20,557
|
|
||
Payables to related parties
|
538
|
|
|
(83
|
)
|
||
Accrued expenses and other liabilities
|
10,193
|
|
|
1,301
|
|
||
Income taxes payable
|
94,753
|
|
|
(28
|
)
|
||
Net cash provided by operating activities
|
226,451
|
|
|
24,004
|
|
||
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
||||
Purchases of property and equipment
|
(105,349
|
)
|
|
(66,575
|
)
|
||
Purchases of property and equipment from related parties
|
(3,436
|
)
|
|
—
|
|
||
Business acquisitions
|
(13,356
|
)
|
|
(39,570
|
)
|
||
Proceeds from disposal of property and equipment
|
898
|
|
|
781
|
|
||
Business combination cash acquired (Note 4)
|
—
|
|
|
2,671
|
|
||
Net cash used in investing activities
|
(121,243
|
)
|
|
(102,693
|
)
|
||
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
||||
Borrowings from lines of credit
|
52,000
|
|
|
79,150
|
|
||
Repayments of lines of credit
|
(151,900
|
)
|
|
(14,150
|
)
|
||
Repayments of equipment financing note
|
(145
|
)
|
|
—
|
|
||
Repayment of Stingray acquisition long-term debt
|
—
|
|
|
(7,074
|
)
|
||
Net cash (used in) provided by financing activities
|
(100,045
|
)
|
|
57,926
|
|
||
Effect of foreign exchange rate on cash
|
(98
|
)
|
|
73
|
|
||
Net change in cash and cash equivalents
|
5,065
|
|
|
(20,690
|
)
|
||
Cash and cash equivalents at beginning of period
|
5,637
|
|
|
29,239
|
|
||
Cash and cash equivalents at end of period
|
$
|
10,702
|
|
|
$
|
8,549
|
|
|
|
|
|
||||
Supplemental disclosure of cash flow information:
|
|
|
|
||||
Cash paid for interest
|
$
|
2,543
|
|
|
$
|
1,086
|
|
Cash paid for income taxes
|
$
|
32,584
|
|
|
$
|
912
|
|
Supplemental disclosure of non-cash transactions:
|
|
|
|
||||
Purchases of property and equipment included in accounts payable and accrued expenses
|
$
|
20,897
|
|
|
$
|
7,836
|
|
Acquisition of Sturgeon, Stingray Cementing LLC and Stingray Energy Services LLC (Note 4)
|
$
|
—
|
|
|
$
|
23,091
|
|
1.
|
Organization and Nature of Business
|
|
|
At June 30, 2018
|
|
At December 31, 2017
|
||||||||
|
|
Share Count
|
|
% Ownership
|
|
Share Count
|
|
% Ownership
|
||||
Wexford
|
|
22,252,277
|
|
|
49.7
|
%
|
|
25,009,319
|
|
|
56.1
|
%
|
Gulfport
|
|
9,943,645
|
|
|
22.2
|
%
|
|
11,171,887
|
|
|
25.1
|
%
|
Rhino
|
|
104,100
|
|
|
0.2
|
%
|
|
568,794
|
|
|
1.3
|
%
|
Outstanding shares owned by related parties
|
|
32,300,022
|
|
|
72.1
|
%
|
|
36,750,000
|
|
|
82.5
|
%
|
Total outstanding
|
|
44,752,765
|
|
|
100.0
|
%
|
|
44,589,306
|
|
|
100.0
|
%
|
2.
|
Basis of Presentation and Significant Accounting Policies
|
Balance, January 1, 2017
|
|
$
|
5,377
|
|
Additions charged to expense
|
|
16,206
|
|
|
Additions other
|
|
179
|
|
|
Deductions for uncollectible receivables written off
|
|
(25
|
)
|
|
Balance, December 31, 2017
|
|
21,737
|
|
|
Additions charged to expense
|
|
53,790
|
|
|
Deductions for uncollectible receivables written off
|
|
(1,758
|
)
|
|
Balance, June 30, 2018
|
|
$
|
73,769
|
|
|
REVENUES
|
|
ACCOUNTS RECEIVABLE
|
|||||||||||
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
At June 30,
|
At December 31,
|
||||||||
|
2018
|
2017
|
|
2018
|
2017
|
|
2018
|
2017
|
||||||
Customer A
(a)
|
65
|
%
|
—
|
%
|
|
65
|
%
|
—
|
%
|
|
59
|
%
|
56
|
%
|
Customer B
(b)
|
9
|
%
|
59
|
%
|
|
11
|
%
|
59
|
%
|
|
9
|
%
|
12
|
%
|
a.
|
Customer A is a third-party customer. Revenues and the related accounts receivable balances earned from Customer A were derived from the Company's infrastructure services segment.
|
b.
|
Customer B is a related party customer. Revenues and the related accounts receivable balances earned from Customer B were derived from the Company's pressure pumping services segment, natural sand proppant services segment, contract land and directional drilling services segment and other businesses.
|
3.
|
Revenues
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30, 2018
|
|
June 30, 2017
|
|
June 30, 2018
|
|
June 30, 2017
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Pressure pumping services
|
$
|
101,406
|
|
|
$
|
50,196
|
|
|
$
|
202,544
|
|
|
$
|
90,836
|
|
Infrastructure services
|
360,250
|
|
|
1,709
|
|
|
685,709
|
|
|
1,709
|
|
||||
Natural sand proppant services
|
52,845
|
|
|
24,762
|
|
|
103,860
|
|
|
40,359
|
|
||||
Contract land and directional drilling services
|
17,210
|
|
|
12,472
|
|
|
32,440
|
|
|
23,223
|
|
||||
Other services
|
20,167
|
|
|
10,242
|
|
|
43,062
|
|
|
19,092
|
|
||||
Eliminations
|
(18,284
|
)
|
|
(1,119
|
)
|
|
(39,772
|
)
|
|
(1,991
|
)
|
||||
Total revenue
|
$
|
533,594
|
|
|
$
|
98,262
|
|
|
$
|
1,027,843
|
|
|
$
|
173,228
|
|
4.
|
Acquisitions
|
|
|
WTL
|
||
Property, plant and equipment
|
|
$
|
2,960
|
|
Identifiable intangible assets - customer relationships
(a)
|
|
930
|
|
|
Identifiable intangible assets - trade name
(a)
|
|
650
|
|
|
Goodwill
(b)
|
|
1,567
|
|
|
Total assets acquired
|
|
$
|
6,107
|
|
a.
|
Identifiable intangible assets were measured using a combination of income approaches. Trade names were valued using a "Relief-from-Royalty" method. Non-contractual customer relationships were valued using a "Multi-period excess earnings" method. Identifiable intangible assets will be amortized over
10
-
20
years.
|
b.
|
Goodwill was the excess of the consideration transferred over the net assets recognized and represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Goodwill recorded in connection with the acquisition is attributable to the assembled workforce and future profitability expected to arise from the acquired entity.
|
|
|
2018
|
||
Revenues
|
|
$
|
595
|
|
Net income
(a)
|
|
5
|
|
|
Six Months Ended
|
||||||
|
June 30, 2018
|
|
June 30, 2017
|
||||
Revenues
|
$
|
3,354
|
|
|
$
|
1,553
|
|
Net income
|
90
|
|
|
62
|
|
|
|
RTS
|
||
Inventory
|
|
$
|
180
|
|
Property, plant and equipment
|
|
7,787
|
|
|
Goodwill
(a)
|
|
133
|
|
|
Total assets acquired
|
|
$
|
8,100
|
|
a.
|
Goodwill was the excess of the consideration transferred over the net assets recognized and represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Goodwill recorded in connection with the acquisition is attributable to the assembled workforce and future profitability expected to arise from the acquired entity.
|
|
|
2018
|
||
Revenues
|
|
$
|
630
|
|
Net income
(a)
|
|
7
|
|
|
Six Months Ended
|
||||||
|
June 30, 2018
|
|
June 30, 2017
|
||||
Revenues
|
$
|
10,160
|
|
|
$
|
8,326
|
|
Net income (loss)
|
(848
|
)
|
|
653
|
|
|
|
5 Star
|
||
Accounts receivable
|
|
$
|
2,440
|
|
Property, plant and equipment
|
|
1,863
|
|
|
Identifiable intangible assets - trade names
(a)
|
|
300
|
|
|
Goodwill
(b)
|
|
248
|
|
|
Total assets acquired
|
|
$
|
4,851
|
|
|
|
|
||
Long-term debt and other liabilities
|
|
$
|
2,413
|
|
Total liabilities assumed
|
|
$
|
2,413
|
|
Net assets acquired
|
|
$
|
2,438
|
|
a.
|
Identifiable intangible assets were measured using a combination of income approaches. Trade names were valued using a "Relief-from-Royalty" method. Identifiable intangible assets will be amortized over
10
years.
|
b.
|
Goodwill was the excess of the consideration transferred over the net assets recognized and represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Goodwill recorded in connection with the acquisition is attributable to the assembled workforce and future profitability expected to arise from the acquired entity.
|
|
|
2018
|
|
2017
|
||||
Revenues
(a)
|
|
$
|
86,720
|
|
|
$
|
25,216
|
|
Net income
(b)
|
|
12,903
|
|
|
4,191
|
|
|
Six Months Ended June 30, 2017
|
||
Revenues
|
$
|
6,332
|
|
Net loss
|
(282
|
)
|
|
|
Higher Power
|
||
Property, plant and equipment
|
|
$
|
1,744
|
|
Identifiable intangible assets - customer relationships
|
|
1,613
|
|
|
Goodwill
(a)
|
|
643
|
|
|
Total assets acquired
|
|
$
|
4,000
|
|
a.
|
Goodwill was the excess of the consideration transferred over the net assets recognized and represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Goodwill recorded in connection with the acquisition is attributable to the assembled workforce and future profitability expected to arise from the acquired entity.
|
|
|
2018
|
|
2017
|
||||
Revenues
(a)
|
|
$
|
122,734
|
|
|
$
|
39,571
|
|
Net income
(b)
|
|
16,205
|
|
|
5,127
|
|
|
Six Months Ended June 30, 2017
|
||
Revenues
|
$
|
4,481
|
|
Net loss
|
(411
|
)
|
|
|
Total
|
||
Property, plant and equipment
(a)
|
|
$
|
23,373
|
|
Sand reserves
(b)
|
|
20,910
|
|
|
Total assets acquired
|
|
$
|
44,283
|
|
|
|
|
||
Asset retirement obligation
|
|
1,732
|
|
|
Total liabilities assumed
|
|
$
|
1,732
|
|
Total allocation of purchase price
|
|
$
|
42,551
|
|
Bargain purchase price
(c,d)
|
|
(6,231
|
)
|
|
Total purchase price
|
|
$
|
36,320
|
|
a.
|
Property, plant and equipment fair value measurements were prepared by utilizing a combined fair market value and cost approach. The market approach relies on comparability of assets using market data information. The cost approach places emphasis on the physical components and characteristics of the asset. It places reliance on estimated replacement cost, depreciation and economic obsolescence.
|
b.
|
The fair value of the sand reserves was determined based on the excess cash flow method, a form of the income approach. The method provides a value based on the estimated remaining life of sand reserves, projected financial information and industry projections.
|
c.
|
Amount reflected in unaudited condensed consolidated statements of comprehensive income (loss) reflected net of income taxes of
$2.2 million
.
|
d.
|
The fair value of the business was determined based on the excess cash flow method, a form of the income approach.
|
|
|
2018
|
|
2017
|
||||
Revenues
(a)
|
|
$
|
35,128
|
|
|
$
|
22,847
|
|
Net income
(b)
|
|
10,694
|
|
|
5,520
|
|
|
Six Months Ended June 30, 2017
|
||
Revenues
|
$
|
1,312
|
|
Net loss
|
(72
|
)
|
Consideration attributable to Cementing
(a)
|
|
$
|
12,975
|
|
Consideration attributable to SR Energy
(a)
|
|
12,787
|
|
|
Total consideration transferred
|
|
$
|
25,762
|
|
|
|
SR Energy
|
Cementing
|
|
Total
|
||||||
|
|
(in thousands)
|
|||||||||
Cash and cash equivalents
|
|
$
|
1,611
|
|
$
|
1,060
|
|
|
$
|
2,671
|
|
Accounts receivable, net
|
|
3,913
|
|
495
|
|
|
4,408
|
|
|||
Receivables from related parties
|
|
3,684
|
|
1,418
|
|
|
5,102
|
|
|||
Inventories
|
|
—
|
|
306
|
|
|
306
|
|
|||
Prepaid expenses
|
|
35
|
|
32
|
|
|
67
|
|
|||
Property, plant and equipment
(a)
|
|
13,061
|
|
7,459
|
|
|
20,520
|
|
|||
Identifiable intangible assets - customer relationships
(b)
|
|
—
|
|
1,140
|
|
|
1,140
|
|
|||
Identifiable intangible assets - trade names
(b)
|
|
550
|
|
270
|
|
|
820
|
|
|||
Goodwill
(c)
|
|
3,929
|
|
6,264
|
|
|
10,193
|
|
|||
Other assets
|
|
7
|
|
—
|
|
|
7
|
|
|||
Total assets acquired
|
|
$
|
26,790
|
|
$
|
18,444
|
|
|
$
|
45,234
|
|
|
|
|
|
|
|
||||||
Accounts payable and accrued liabilities
|
|
$
|
5,890
|
|
$
|
2,063
|
|
|
$
|
7,953
|
|
Long-term debt
(d)
|
|
5,074
|
|
2,000
|
|
|
7,074
|
|
|||
Deferred tax liability
|
|
3,039
|
|
1,406
|
|
|
4,445
|
|
|||
Total liabilities assumed
|
|
$
|
14,003
|
|
$
|
5,469
|
|
|
$
|
19,472
|
|
Net assets acquired
|
|
$
|
12,787
|
|
$
|
12,975
|
|
|
$
|
25,762
|
|
a.
|
Property, plant and equipment fair value measurements were prepared by utilizing a combined fair market value and cost approach. The market approach relies on comparability of assets using market data information. The cost approach places emphasis on the physical components and characteristics of the asset. It places reliance on estimated replacement cost, depreciation and economic obsolescence.
|
b.
|
Identifiable intangible assets were measured using a combination of income approaches. Trade names were valued using a "Relief-from-Royalty" method. Non-contractual customer relationships were valued using a "Multi-period excess earnings" method. Identifiable intangible assets will be amortized over
5
-
10
years.
|
c.
|
Goodwill was the excess of the consideration transferred over the net assets recognized and represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Goodwill recorded in connection with the acquisition is attributable to the assembled workforces and future profitability expected to arise from the acquired entities.
|
d.
|
Long-term debt assumed was paid off subsequent to the acquisitions.
|
|
2018
|
|
2017
|
||||||||||
|
SR Energy
|
Cementing
|
|
SR Energy
|
Cementing
|
||||||||
Revenues
(a)
|
$
|
16,034
|
|
$
|
5,131
|
|
|
$
|
11,572
|
|
$
|
7,500
|
|
Net loss
(b)
|
(1,586
|
)
|
(806
|
)
|
|
(1,626
|
)
|
(1,963
|
)
|
a.
|
Includes intercompany revenues of
$1.6 million
and
$0.6 million
for SR Energy in 2018 and 2017.
|
b.
|
Includes depreciation and amortization expense of
$2.8 million
and
$1.0 million
, respectively, for SR Energy and Cementing in 2018 and
$3.4 million
and
$4.1 million
, respectively, for SR Energy and Cementing in 2017
.
|
|
Six Months Ended June 30, 2017
|
||
Revenues
|
$
|
18,333
|
|
Net loss
|
(1,612
|
)
|
5.
|
Inventories
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
Supplies
|
|
$
|
7,264
|
|
|
$
|
9,437
|
|
Raw materials
|
|
321
|
|
|
219
|
|
||
Work in process
|
|
1,326
|
|
|
2,370
|
|
||
Finished goods
|
|
3,806
|
|
|
5,788
|
|
||
Total inventory
|
|
$
|
12,717
|
|
|
$
|
17,814
|
|
6.
|
Property, Plant and Equipment
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
Useful Life
|
|
2018
|
|
2017
|
||||
Pressure pumping equipment
|
3-5 years
|
|
$
|
199,333
|
|
|
$
|
190,211
|
|
Drilling rigs and related equipment
|
3-15 years
|
|
137,075
|
|
|
132,260
|
|
||
Machinery and equipment
(a)
|
7-20 years
|
|
140,308
|
|
|
97,569
|
|
||
Buildings
|
15-39 years
|
|
47,593
|
|
|
45,992
|
|
||
Vehicles, trucks and trailers
(b)
|
5-10 years
|
|
91,680
|
|
|
54,055
|
|
||
Coil tubing equipment
|
4-10 years
|
|
28,068
|
|
|
28,053
|
|
||
Land
|
N/A
|
|
14,183
|
|
|
11,317
|
|
||
Land improvements
|
15 years or life of lease
|
|
9,614
|
|
|
9,614
|
|
||
Rail improvements
|
10-20 years
|
|
13,101
|
|
|
5,540
|
|
||
Other property and equipment
|
3-12 years
|
|
15,006
|
|
|
12,687
|
|
||
|
|
|
695,961
|
|
|
587,298
|
|
||
Deposits on equipment and equipment in process of assembly
|
|
|
33,349
|
|
|
20,348
|
|
||
|
|
|
729,310
|
|
|
607,646
|
|
||
Less: accumulated depreciation
(c)
|
|
|
305,995
|
|
|
256,629
|
|
||
Property, plant and equipment, net
|
|
|
$
|
423,315
|
|
|
$
|
351,017
|
|
a.
|
Included in machinery and equipment are assets under capital leases totaling
$1.8 million
and
$1.8 million
, respectively, at
June 30, 2018
and
December 31, 2017
.
|
b.
|
Included in vehicles, trucks and trailers are assets under capital leases totaling
$3.8 million
and
$1.0 million
, respectively, at
June 30, 2018
and
December 31, 2017
.
|
c.
|
Accumulated depreciation for assets under capital leases totaled
$0.9 million
and
$0.8 million
, respectively, at
June 30, 2018
and
December 31, 2017
.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Depreciation expense
(a)
|
$
|
27,058
|
|
|
$
|
17,229
|
|
|
$
|
51,456
|
|
|
$
|
32,196
|
|
Depletion expense
|
1,340
|
|
|
382
|
|
|
1,427
|
|
|
384
|
|
||||
Amortization expense
|
2,382
|
|
|
2,268
|
|
|
4,790
|
|
|
4,536
|
|
||||
Accretion expense
|
15
|
|
|
14
|
|
|
30
|
|
|
14
|
|
||||
Depreciation, depletion, amortization and accretion
|
$
|
30,795
|
|
|
$
|
19,893
|
|
|
$
|
57,703
|
|
|
$
|
37,130
|
|
a.
|
Includes depreciation expense for assets under capital leases totaling
$0.4 million
and
$0.2 million
, respectively, for the
six
months ended
June 30, 2018
and
2017
.
|
7.
|
Intangible Assets and Goodwill
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
Customer relationships
|
|
$
|
36,725
|
|
|
$
|
35,795
|
|
Trade names
|
|
9,443
|
|
|
8,793
|
|
||
Less: accumulated amortization - customer relationships
|
|
(30,521
|
)
|
|
(26,172
|
)
|
||
Less: accumulated amortization - trade names
|
|
(2,717
|
)
|
|
(2,277
|
)
|
||
Intangible assets, net
|
|
$
|
12,930
|
|
|
$
|
16,139
|
|
|
|
Amount
|
||
Remainder of 2018
|
|
$
|
3,969
|
|
2019
|
|
1,293
|
|
|
2020
|
|
1,293
|
|
|
2021
|
|
1,288
|
|
|
2022
|
|
1,266
|
|
|
Thereafter
|
|
3,821
|
|
|
|
|
$
|
12,930
|
|
Balance, January 1, 2017
|
|
$
|
88,727
|
|
Additions - 2017 Stingray Acquisition (Note 4)
|
|
10,193
|
|
|
Additions - Higher Power Acquisition (Note 4)
|
|
643
|
|
|
Additions - 5 Star Acquisition (Note 4)
|
|
248
|
|
|
Balance, December 31, 2017
|
|
99,811
|
|
|
Additions - WTL Acquisition (Note 4)
|
|
1,567
|
|
|
Additions - RTS Acquisition (Note 4)
|
|
133
|
|
|
Balance, June 30, 2018
|
|
$
|
101,511
|
|
8.
|
Accrued Expenses and Other Current Liabilities
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
Deferred revenue
|
|
15,100
|
|
|
15,210
|
|
||
Accrued compensation, benefits and related taxes
|
|
19,917
|
|
|
11,552
|
|
||
Financed insurance premiums
|
|
1,638
|
|
|
4,876
|
|
||
Insurance reserves
|
|
4,183
|
|
|
2,942
|
|
||
State and local taxes payable
|
|
8,205
|
|
|
2,126
|
|
||
Other
|
|
5,658
|
|
|
4,189
|
|
||
Total
|
|
$
|
54,701
|
|
|
$
|
40,895
|
|
9.
|
Debt
|
10.
|
Other Liabilities
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
Capital lease obligations
|
|
$
|
4,253
|
|
|
$
|
2,015
|
|
Equipment financing arrangement
|
|
1,436
|
|
|
1,605
|
|
||
Other
|
|
250
|
|
|
500
|
|
||
Total
|
|
5,939
|
|
|
4,120
|
|
||
Less: Current portion of capital lease and equipment financing obligations included in accrued expenses and other current liabilities
|
|
(1,839
|
)
|
|
(831
|
)
|
||
Total Other Liabilities
|
|
$
|
4,100
|
|
|
$
|
3,289
|
|
2018
|
$
|
890
|
|
2019
|
2,593
|
|
|
2020
|
1,696
|
|
|
2021
|
664
|
|
|
2022
|
360
|
|
|
Total future minimum payments
|
6,203
|
|
|
Less interest payments
|
(514
|
)
|
|
Present value of future minimum payments
|
$
|
5,689
|
|
11.
|
Variable Interest Entity
|
12.
|
Selling, General and Administrative Expense
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Cash expenses:
|
|
|
|
|
|
|
|
||||||||
Compensation and benefits
|
$
|
10,978
|
|
|
$
|
2,966
|
|
|
$
|
18,677
|
|
|
$
|
5,381
|
|
Professional services
|
2,981
|
|
|
1,652
|
|
|
5,568
|
|
|
3,581
|
|
||||
Other
(a)
|
3,935
|
|
|
2,015
|
|
|
5,542
|
|
|
3,880
|
|
||||
Total cash SG&A expense
|
17,894
|
|
|
6,633
|
|
|
29,787
|
|
|
12,842
|
|
||||
Non-cash expenses:
|
|
|
|
|
|
|
|
||||||||
Bad debt provision
|
28,263
|
|
|
17
|
|
|
53,790
|
|
|
(25
|
)
|
||||
Equity based compensation
(b)
|
17,487
|
|
|
—
|
|
|
17,487
|
|
|
—
|
|
||||
Stock based compensation
|
1,483
|
|
|
1,050
|
|
|
2,574
|
|
|
1,620
|
|
||||
Total non-cash SG&A expense
|
47,233
|
|
|
1,067
|
|
|
73,851
|
|
|
1,595
|
|
||||
Total SG&A expense
|
$
|
65,127
|
|
|
$
|
7,700
|
|
|
$
|
103,638
|
|
|
$
|
14,437
|
|
a.
|
Includes travel-related costs, IT expenses, rent, utilities and other general and administrative-related costs.
|
b.
|
Represents compensation expense for non-employee awards, which were issued and are payable by certain affiliates of Wexford (the sponsor level). See Note 15 for additional detail.
|
13.
|
Income Taxes
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Foreign current income tax expense
|
$
|
67,665
|
|
|
$
|
21
|
|
|
$
|
125,712
|
|
|
$
|
606
|
|
Foreign deferred income tax benefit
|
(15,266
|
)
|
|
(14
|
)
|
|
(25,386
|
)
|
|
(20
|
)
|
||||
U.S. current income tax expense
|
1,636
|
|
|
—
|
|
|
1,624
|
|
|
—
|
|
||||
U.S. deferred income tax benefit
|
(523
|
)
|
|
(2,811
|
)
|
|
(2,520
|
)
|
|
(6,496
|
)
|
||||
Total
|
$
|
53,512
|
|
|
$
|
(2,804
|
)
|
|
$
|
99,430
|
|
|
$
|
(5,910
|
)
|
14.
|
Earnings (Loss) Per Share
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Basic earnings (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Allocation of earnings:
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
42,700
|
|
|
$
|
(1,170
|
)
|
|
$
|
98,246
|
|
|
$
|
(6,151
|
)
|
Weighted average common shares outstanding
|
44,737
|
|
|
39,500
|
|
|
44,700
|
|
|
38,506
|
|
||||
Basic earnings (loss) per share
|
$
|
0.95
|
|
|
$
|
(0.03
|
)
|
|
$
|
2.20
|
|
|
$
|
(0.16
|
)
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Allocation of earnings (loss):
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
42,700
|
|
|
$
|
(1,170
|
)
|
|
$
|
98,246
|
|
|
$
|
(6,151
|
)
|
Weighted average common shares, including dilutive effect
(a)
|
45,059
|
|
|
39,500
|
|
|
44,977
|
|
|
38,506
|
|
||||
Diluted earnings (loss) per share
|
$
|
0.95
|
|
|
$
|
(0.03
|
)
|
|
$
|
2.18
|
|
|
$
|
(0.16
|
)
|
a.
|
No
incremental shares of potentially dilutive restricted stock awards were included for the three and six months ended
June 30, 2017
as their effect was antidulitive under the treasury stock method.
|
15.
|
Equity Based Compensation
|
16.
|
Stock Based Compensation
|
|
|
Number of Unvested Restricted Shares
|
|
Weighted Average Grant-Date Fair Value
|
|||
Unvested shares as of January 1, 2018
|
|
640,632
|
|
|
$
|
19.44
|
|
Granted
|
|
93,556
|
|
|
26.83
|
|
|
Vested
|
|
(149,098
|
)
|
|
21.29
|
|
|
Forfeited
|
|
—
|
|
|
—
|
|
|
Unvested shares as of June 30, 2018
|
|
585,090
|
|
|
$
|
21.07
|
|
17.
|
Related Party Transactions
|
|
|
REVENUES
|
|
ACCOUNTS RECEIVABLE
|
|||||||||||||||||
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
At June 30,
|
At December 31,
|
||||||||||||||
|
|
2018
|
2017
|
|
2018
|
2017
|
|
2018
|
2017
|
||||||||||||
Pressure Pumping and Gulfport
|
(a)
|
$
|
33,831
|
|
$
|
41,100
|
|
|
$
|
72,377
|
|
$
|
72,845
|
|
|
$
|
20,127
|
|
$
|
25,054
|
|
Muskie and Gulfport
|
(b)
|
9,730
|
|
13,605
|
|
|
21,192
|
|
25,145
|
|
|
4,428
|
|
1,947
|
|
||||||
Panther Drilling and Gulfport
|
(c)
|
—
|
|
952
|
|
|
56
|
|
1,994
|
|
|
12
|
|
872
|
|
||||||
Cementing and Gulfport
|
(d)
|
2,048
|
|
903
|
|
|
4,876
|
|
903
|
|
|
1,739
|
|
2,255
|
|
||||||
SR Energy and Gulfport
|
(e)
|
4,626
|
|
1,565
|
|
|
11,579
|
|
1,565
|
|
|
4,292
|
|
3,348
|
|
||||||
Panther Drilling and El Toro
|
(f)
|
—
|
|
—
|
|
|
345
|
|
—
|
|
|
—
|
|
—
|
|
||||||
Redback Energy and El Toro
|
(g)
|
92
|
|
34
|
|
|
92
|
|
158
|
|
|
—
|
|
—
|
|
||||||
Coil Tubing and El Toro
|
(h)
|
—
|
|
—
|
|
|
360
|
|
—
|
|
|
(2
|
)
|
—
|
|
||||||
Bison Drilling and Predator
|
(i)
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
234
|
|
||||||
Other Relationships
|
|
14
|
|
49
|
|
|
14
|
|
100
|
|
|
78
|
|
78
|
|
||||||
|
|
$
|
50,341
|
|
$
|
58,208
|
|
|
$
|
110,891
|
|
$
|
102,710
|
|
|
$
|
30,674
|
|
$
|
33,788
|
|
a.
|
Pressure Pumping provides pressure pumping, stimulation and related completion services to Gulfport.
|
b.
|
Muskie has agreed to sell and deliver, and Gulfport has agreed to purchase, specified annual and monthly amounts of natural sand proppant, subject to certain exceptions specified in the agreement, and pay certain costs and expenses.
|
c.
|
Panther Drilling performs drilling services for Gulfport pursuant to a master service agreement.
|
d.
|
Cementing performs well cementing services for Gulfport.
|
e.
|
SR Energy performs rental services for Gulfport.
|
f.
|
Panther provides services for El Toro, an entity controlled by Wexford, pursuant to a master service agreement.
|
g.
|
Redback Energy performs completion and production services for El Toro pursuant to a master service agreement.
|
h.
|
Coil Tubing provides to El Toro services in connection with completion and drilling activities.
|
i.
|
Bison Drilling provides equipment rentals to Predator, an entity in which Wexford owns a minority interest.
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
At June 30,
|
At December 31,
|
||||||||||||||
|
|
2018
|
2017
|
|
2018
|
2017
|
|
2018
|
2017
|
||||||||||||
|
|
COST OF REVENUE
|
|
COST OF REVENUE
|
|
ACCOUNTS PAYABLE
|
|||||||||||||||
Cobra and T&E
|
(a)
|
$
|
1,486
|
|
$
|
—
|
|
|
$
|
2,762
|
|
$
|
—
|
|
|
$
|
289
|
|
$
|
457
|
|
Higher Power and T&E
|
(a)
|
950
|
|
—
|
|
|
1,458
|
|
—
|
|
|
576
|
|
3
|
|
||||||
Panther and DBDHT
|
(b)
|
—
|
|
—
|
|
|
—
|
|
128
|
|
|
—
|
|
77
|
|
||||||
The Company and 2017 Stingray Companies
|
(c)
|
—
|
|
207
|
|
|
—
|
|
444
|
|
|
—
|
|
—
|
|
||||||
Other
|
|
(8
|
)
|
55
|
|
|
—
|
|
120
|
|
|
—
|
|
218
|
|
||||||
|
|
$
|
2,428
|
|
$
|
262
|
|
|
$
|
4,220
|
|
$
|
692
|
|
|
$
|
865
|
|
$
|
755
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
SELLING, GENERAL AND ADMINISTRATIVE COSTS
|
|
SELLING, GENERAL AND ADMINISTRATIVE COSTS
|
|
|
|
||||||||||||||
The Company and Everest
|
(d)
|
$
|
55
|
|
$
|
50
|
|
|
$
|
86
|
|
$
|
108
|
|
|
$
|
6
|
|
$
|
19
|
|
The Company and Wexford
|
(e)
|
290
|
|
165
|
|
|
473
|
|
398
|
|
|
78
|
|
150
|
|
||||||
The Company and Caliber
|
(f)
|
145
|
|
72
|
|
|
346
|
|
72
|
|
|
47
|
|
1
|
|
||||||
Other
|
|
42
|
|
20
|
|
|
56
|
|
53
|
|
|
—
|
|
2
|
|
||||||
|
|
$
|
532
|
|
$
|
307
|
|
|
$
|
961
|
|
$
|
631
|
|
|
$
|
131
|
|
$
|
172
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
CAPITAL EXPENDITURES
|
|
CAPITAL EXPENDITURES
|
|
|
|
||||||||||||||
Cobra and T&E
|
(a)
|
$
|
757
|
|
$
|
—
|
|
|
$
|
1,131
|
|
$
|
—
|
|
|
$
|
170
|
|
$
|
66
|
|
Higher Power and T&E
|
(a)
|
1,575
|
|
—
|
|
|
2,773
|
|
—
|
|
|
750
|
|
385
|
|
||||||
|
|
$
|
2,332
|
|
$
|
—
|
|
|
$
|
3,904
|
|
$
|
—
|
|
|
$
|
920
|
|
$
|
451
|
|
|
|
|
|
|
|
|
|
$
|
1,916
|
|
$
|
1,378
|
|
a.
|
Cobra and Higher Power purchase materials and services from T&E, an entity in which a member of management's family owns a minority interest.
|
b.
|
Panther rents rotary steerable equipment in connection with its directional drilling services from DBDHT.
|
c.
|
Prior to the 2017 Stingray Acquisition, the 2017 Stingray Companies provided certain services to the Company and, from time to time, the 2017 Stingray Companies paid for goods and services on behalf of the Company.
|
d.
|
Everest has historically provided office space and certain technical, administrative and payroll services to the Company and the Company has reimbursed Everest in amounts determined by Everest based on estimates of the amount of office space provided and the amount of employees’ time spent performing services for the Company.
|
e.
|
Wexford provides certain administrative and analytical services to the Company and, from time to time, the Company pays for goods and services on behalf of Wexford.
|
f.
|
Caliber leases office space to Mammoth.
|
18.
|
Commitments and Contingencies
|
Year ended December 31:
|
|
Operating Leases
|
|
Capital Spend Commitments
|
|
Minimum Purchase Commitments
|
||||||
Remainder of 2018
|
|
$
|
12,148
|
|
|
$
|
16,393
|
|
|
$
|
19,254
|
|
2019
|
|
18,091
|
|
|
—
|
|
|
12,125
|
|
|||
2020
|
|
15,622
|
|
|
—
|
|
|
400
|
|
|||
2021
|
|
12,029
|
|
|
—
|
|
|
165
|
|
|||
2022
|
|
8,995
|
|
|
—
|
|
|
—
|
|
|||
Thereafter
|
|
6,057
|
|
|
—
|
|
|
—
|
|
|||
|
|
$
|
72,942
|
|
|
$
|
16,393
|
|
|
$
|
31,944
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
Environmental remediation
|
|
$
|
3,582
|
|
|
$
|
3,582
|
|
Insurance programs
|
|
2,486
|
|
|
2,486
|
|
||
Rail car commitments
|
|
455
|
|
|
455
|
|
||
Total letters of credit
|
|
$
|
6,523
|
|
|
$
|
6,523
|
|
19.
|
Reporting Segments
|
Three months ended June 30, 2018
|
Pressure Pumping
|
Infrastructure
|
Sand
|
Drilling
|
All Other
|
Eliminations
|
Total
|
||||||||||||||
Revenue from external customers
|
$
|
100,333
|
|
$
|
360,250
|
|
$
|
37,439
|
|
$
|
17,126
|
|
$
|
18,446
|
|
$
|
—
|
|
$
|
533,594
|
|
Intersegment revenues
|
1,073
|
|
—
|
|
15,406
|
|
84
|
|
1,721
|
|
(18,284
|
)
|
—
|
|
|||||||
Total revenue
|
101,406
|
|
360,250
|
|
52,845
|
|
17,210
|
|
20,167
|
|
(18,284
|
)
|
533,594
|
|
|||||||
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion
|
61,593
|
|
210,189
|
|
35,117
|
|
15,280
|
|
17,649
|
|
—
|
|
339,828
|
|
|||||||
Intersegment cost of revenues
|
16,174
|
|
754
|
|
1,019
|
|
(40
|
)
|
129
|
|
(18,036
|
)
|
—
|
|
|||||||
Total cost of revenue
|
77,767
|
|
210,943
|
|
36,136
|
|
15,240
|
|
17,778
|
|
(18,036
|
)
|
339,828
|
|
|||||||
Selling, general and administrative
|
20,822
|
|
39,786
|
|
1,787
|
|
1,591
|
|
1,141
|
|
—
|
|
65,127
|
|
|||||||
Depreciation, depletion, amortization and accretion
|
13,829
|
|
4,094
|
|
3,881
|
|
5,349
|
|
3,642
|
|
—
|
|
30,795
|
|
|||||||
Impairment of long-lived assets
|
—
|
|
—
|
|
—
|
|
187
|
|
—
|
|
—
|
|
187
|
|
|||||||
Operating income (loss)
|
(11,012
|
)
|
105,427
|
|
11,041
|
|
(5,157
|
)
|
(2,394
|
)
|
(248
|
)
|
97,657
|
|
|||||||
Interest expense, net
|
341
|
|
106
|
|
76
|
|
265
|
|
171
|
|
—
|
|
959
|
|
|||||||
Other expense
|
80
|
|
330
|
|
36
|
|
32
|
|
8
|
|
—
|
|
486
|
|
|||||||
Income (loss) before income taxes
|
$
|
(11,433
|
)
|
$
|
104,991
|
|
$
|
10,929
|
|
$
|
(5,454
|
)
|
$
|
(2,573
|
)
|
$
|
(248
|
)
|
$
|
96,212
|
|
Three months ended June 30, 2017
|
Pressure Pumping
|
Infrastructure
|
Sand
|
Drilling
|
All Other
|
Eliminations
|
Total
|
||||||||||||||
Revenue from external customers
|
$
|
49,924
|
|
$
|
1,709
|
|
$
|
24,000
|
|
$
|
12,472
|
|
$
|
10,157
|
|
$
|
—
|
|
$
|
98,262
|
|
Intersegment revenues
|
272
|
|
—
|
|
762
|
|
—
|
|
85
|
|
(1,119
|
)
|
—
|
|
|||||||
Total revenue
|
50,196
|
|
1,709
|
|
24,762
|
|
12,472
|
|
10,242
|
|
(1,119
|
)
|
98,262
|
|
|||||||
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion
|
35,826
|
|
1,626
|
|
19,974
|
|
12,033
|
|
7,881
|
|
—
|
|
77,340
|
|
|||||||
Intersegment cost of revenues
|
847
|
|
—
|
|
267
|
|
—
|
|
5
|
|
(1,119
|
)
|
—
|
|
|||||||
Total cost of revenue
|
36,673
|
|
1,626
|
|
20,241
|
|
12,033
|
|
7,886
|
|
(1,119
|
)
|
77,340
|
|
|||||||
Selling, general and administrative
|
2,403
|
|
307
|
|
2,416
|
|
1,435
|
|
1,139
|
|
—
|
|
7,700
|
|
|||||||
Depreciation, depletion, amortization and accretion
|
9,626
|
|
340
|
|
2,206
|
|
4,974
|
|
2,747
|
|
—
|
|
19,893
|
|
|||||||
Operating income (loss)
|
1,494
|
|
(564
|
)
|
(101
|
)
|
(5,970
|
)
|
(1,530
|
)
|
—
|
|
(6,671
|
)
|
|||||||
Interest expense, net
|
303
|
|
4
|
|
353
|
|
440
|
|
12
|
|
—
|
|
1,112
|
|
|||||||
Bargain purchase gain
|
—
|
|
—
|
|
(4,012
|
)
|
—
|
|
—
|
|
—
|
|
(4,012
|
)
|
|||||||
Other expense
|
4
|
|
—
|
|
140
|
|
60
|
|
(1
|
)
|
—
|
|
203
|
|
|||||||
Income (loss) before income taxes
|
$
|
1,187
|
|
$
|
(568
|
)
|
$
|
3,418
|
|
$
|
(6,470
|
)
|
$
|
(1,541
|
)
|
$
|
—
|
|
$
|
(3,974
|
)
|
Six months ended June 30, 2018
|
Pressure Pumping
|
Infrastructure
|
Sand
|
Drilling
|
All Other
|
Eliminations
|
Total
|
||||||||||||||
Revenue from external customers
|
$
|
196,912
|
|
$
|
685,709
|
|
$
|
73,942
|
|
$
|
32,354
|
|
$
|
38,926
|
|
$
|
—
|
|
$
|
1,027,843
|
|
Intersegment revenues
|
5,632
|
|
—
|
|
29,918
|
|
86
|
|
4,136
|
|
(39,772
|
)
|
—
|
|
|||||||
Total revenue
|
202,544
|
|
685,709
|
|
103,860
|
|
32,440
|
|
43,062
|
|
(39,772
|
)
|
1,027,843
|
|
|||||||
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion
|
128,205
|
|
404,265
|
|
68,447
|
|
29,755
|
|
35,257
|
|
—
|
|
665,929
|
|
|||||||
Intersegment cost of revenues
|
31,576
|
|
2,545
|
|
5,305
|
|
122
|
|
234
|
|
(39,782
|
)
|
—
|
|
|||||||
Total cost of revenue
|
159,781
|
|
406,810
|
|
73,752
|
|
29,877
|
|
35,491
|
|
(39,782
|
)
|
665,929
|
|
|||||||
Selling, general and administrative
|
23,485
|
|
71,637
|
|
3,431
|
|
2,844
|
|
2,241
|
|
—
|
|
103,638
|
|
|||||||
Depreciation, depletion, amortization and accretion
|
27,815
|
|
6,501
|
|
6,197
|
|
9,704
|
|
7,486
|
|
—
|
|
57,703
|
|
|||||||
Impairment of long-lived assets
|
—
|
|
—
|
|
—
|
|
187
|
|
—
|
|
—
|
|
187
|
|
|||||||
Operating income (loss)
|
(8,537
|
)
|
200,761
|
|
20,480
|
|
(10,172
|
)
|
(2,156
|
)
|
10
|
|
200,386
|
|
|||||||
Interest expense, net
|
845
|
|
182
|
|
156
|
|
660
|
|
353
|
|
—
|
|
2,196
|
|
|||||||
Other expense
|
92
|
|
332
|
|
23
|
|
72
|
|
(5
|
)
|
—
|
|
514
|
|
|||||||
Income (loss) before income taxes
|
$
|
(9,474
|
)
|
$
|
200,247
|
|
$
|
20,301
|
|
$
|
(10,904
|
)
|
$
|
(2,504
|
)
|
$
|
10
|
|
$
|
197,676
|
|
Six months ended June 30, 2017
|
Pressure Pumping
|
Infrastructure
|
Sand
|
Drilling
|
All Other
|
Eliminations
|
Total
|
||||||||||||||
Revenue from external customers
|
$
|
90,377
|
|
$
|
1,709
|
|
$
|
38,912
|
|
$
|
23,223
|
|
$
|
19,007
|
|
$
|
—
|
|
$
|
173,228
|
|
Intersegment revenues
|
459
|
|
—
|
|
1,447
|
|
—
|
|
85
|
|
(1,991
|
)
|
—
|
|
|||||||
Total revenue
|
90,836
|
|
1,709
|
|
40,359
|
|
23,223
|
|
19,092
|
|
(1,991
|
)
|
173,228
|
|
|||||||
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion
|
64,533
|
|
1,712
|
|
32,582
|
|
22,986
|
|
14,025
|
|
—
|
|
135,838
|
|
|||||||
Intersegment cost of revenues
|
1,532
|
|
—
|
|
454
|
|
—
|
|
5
|
|
(1,991
|
)
|
—
|
|
|||||||
Total cost of revenue
|
66,065
|
|
1,712
|
|
33,036
|
|
22,986
|
|
14,030
|
|
(1,991
|
)
|
135,838
|
|
|||||||
Selling, general and administrative
|
4,180
|
|
355
|
|
4,474
|
|
2,728
|
|
2,700
|
|
—
|
|
14,437
|
|
|||||||
Depreciation, depletion, amortization and accretion
|
18,784
|
|
340
|
|
3,569
|
|
9,942
|
|
4,495
|
|
—
|
|
37,130
|
|
|||||||
Operating income (loss)
|
1,807
|
|
(698
|
)
|
(720
|
)
|
(12,433
|
)
|
(2,133
|
)
|
—
|
|
(14,177
|
)
|
|||||||
Interest expense, net
|
431
|
|
4
|
|
486
|
|
657
|
|
(69
|
)
|
—
|
|
1,509
|
|
|||||||
Bargain purchase gain
|
—
|
|
—
|
|
(4,012
|
)
|
—
|
|
—
|
|
—
|
|
(4,012
|
)
|
|||||||
Other expense
|
7
|
|
—
|
|
154
|
|
224
|
|
2
|
|
—
|
|
387
|
|
|||||||
Income (loss) before income taxes
|
$
|
1,369
|
|
$
|
(702
|
)
|
$
|
2,652
|
|
$
|
(13,314
|
)
|
$
|
(2,066
|
)
|
$
|
—
|
|
$
|
(12,061
|
)
|
|
Pressure Pumping
|
Infrastructure
|
Sand
|
Drilling
|
All Other
|
Eliminations
|
Total
|
||||||||||||||
As of June 30, 2018:
|
|
|
|
|
|
|
|
||||||||||||||
Total assets
(a)
|
$
|
277,895
|
|
$
|
341,171
|
|
$
|
199,421
|
|
$
|
92,578
|
|
$
|
150,579
|
|
$
|
(32,521
|
)
|
$
|
1,029,123
|
|
Goodwill
|
$
|
86,043
|
|
$
|
891
|
|
$
|
2,684
|
|
$
|
—
|
|
$
|
11,893
|
|
$
|
—
|
|
$
|
101,511
|
|
As of December 31, 2017:
|
|
|
|
|
|
|
|
||||||||||||||
Total assets
(a)
|
$
|
297,140
|
|
$
|
205,275
|
|
$
|
190,859
|
|
$
|
88,527
|
|
$
|
243,767
|
|
$
|
(158,325
|
)
|
$
|
867,243
|
|
Goodwill
|
$
|
86,043
|
|
$
|
891
|
|
$
|
2,684
|
|
$
|
—
|
|
$
|
10,193
|
|
$
|
—
|
|
$
|
99,811
|
|
a.
|
Total assets included in the All Other column include Mammoth LLC corporate assets totaling
$34.3 million
and
$148.8 million
, respectively, as of June 30, 2018 and December 31, 2017, of which
$16.9 million
and
$137.4 million
are inter-segment accounts receivable which are eliminated in consolidation.
|
20.
|
Subsequent Events
|
|
Three Months Ended
|
||||||
|
June 30, 2018
|
|
June 30, 2017
|
||||
|
(in thousands)
|
||||||
Revenue:
|
|
|
|
||||
Pressure pumping services
|
$
|
101,406
|
|
|
$
|
50,196
|
|
Infrastructure services
|
360,250
|
|
|
1,709
|
|
||
Natural sand proppant services
|
52,845
|
|
|
24,762
|
|
||
Contract land and directional drilling services
|
17,210
|
|
|
12,472
|
|
||
Other services
|
20,167
|
|
|
10,242
|
|
||
Eliminations
|
(18,284
|
)
|
|
(1,119
|
)
|
||
Total revenue
|
533,594
|
|
|
98,262
|
|
||
|
|
|
|
||||
Cost of revenue:
|
|
|
|
||||
Pressure pumping services (exclusive of depreciation and amortization of $13,841 and $9,597, respectively, for the three months ended June 30, 2018 and 2017)
|
77,767
|
|
|
36,673
|
|
||
Infrastructure services (exclusive of depreciation and amortization of $4,088 and $340, respectively, for the three months ended June 30, 2018 and 2017)
|
210,943
|
|
|
1,626
|
|
||
Natural sand proppant services (exclusive of depreciation, depletion and accretion of $3,879 and $2,204, respectively, for the three months ended June 30, 2018 and 2017)
|
36,136
|
|
|
20,241
|
|
||
Contract land and directional drilling services (exclusive of depreciation of $5,349 and $4,970, respectively, for the three months ended June 30, 2018 and 2017)
|
15,240
|
|
|
12,033
|
|
||
Other services (exclusive of depreciation and amortization of $3,620 and $2,744, respectively, for the three months ended June 30, 2018 and 2017)
|
17,778
|
|
|
7,886
|
|
||
Eliminations
|
(18,036
|
)
|
|
(1,119
|
)
|
||
Total cost of revenue
|
339,828
|
|
|
77,340
|
|
||
Selling, general and administrative expenses
|
65,127
|
|
|
7,700
|
|
||
Depreciation, depletion, amortization and accretion
|
30,795
|
|
|
19,893
|
|
||
Impairment of long-lived assets
|
187
|
|
|
—
|
|
||
Operating income (loss)
|
97,657
|
|
|
(6,671
|
)
|
||
Interest expense, net
|
(959
|
)
|
|
(1,112
|
)
|
||
Bargain purchase gain
|
—
|
|
|
4,012
|
|
||
Other expense, net
|
(486
|
)
|
|
(203
|
)
|
||
Income (loss) before income taxes
|
96,212
|
|
|
(3,974
|
)
|
||
Provision (benefit) for income taxes
|
53,512
|
|
|
(2,804
|
)
|
||
Net income (loss)
|
$
|
42,700
|
|
|
$
|
(1,170
|
)
|
|
Three Months Ended
|
||||||
|
June 30, 2018
|
|
June 30, 2017
|
||||
Cash expenses:
|
|
|
|
||||
Compensation and benefits
|
$
|
10,978
|
|
|
$
|
2,966
|
|
Professional services
|
2,981
|
|
|
1,652
|
|
||
Other
(a)
|
3,935
|
|
|
2,015
|
|
||
Total cash SG&A expense
|
17,894
|
|
|
6,633
|
|
||
Non-cash expenses:
|
|
|
|
||||
Bad debt provision
|
28,263
|
|
|
17
|
|
||
Equity based compensation
(b)
|
17,487
|
|
|
—
|
|
||
Stock based compensation
|
1,483
|
|
|
1,050
|
|
||
Total non-cash SG&A expense
|
47,233
|
|
|
1,067
|
|
||
Total SG&A expense
|
$
|
65,127
|
|
|
$
|
7,700
|
|
a.
|
Includes travel-related costs, IT expenses, rent, utilities and other general and administrative-related costs.
|
b.
|
Represents compensation expense for non-employee awards, which were issued and are payable by certain affiliates of Wexford (the sponsor level).
|
|
Six Months Ended
|
||||||
|
June 30, 2018
|
|
June 30, 2017
|
||||
|
(in thousands)
|
||||||
Revenue:
|
|
|
|
||||
Pressure pumping services
|
$
|
202,544
|
|
|
$
|
90,836
|
|
Infrastructure services
|
685,709
|
|
|
1,709
|
|
||
Natural sand proppant services
|
103,860
|
|
|
40,359
|
|
||
Contract land and directional drilling services
|
32,440
|
|
|
23,223
|
|
||
Other services
|
43,062
|
|
|
19,092
|
|
||
Eliminations
|
(39,772
|
)
|
|
(1,991
|
)
|
||
Total revenue
|
1,027,843
|
|
|
173,228
|
|
||
|
|
|
|
||||
Cost of revenue:
|
|
|
|
||||
Pressure pumping services (exclusive of depreciation and amortization of $27,818 and $18,725, respectively, for the six months ended June 30, 2018 and 2017)
|
159,781
|
|
|
66,065
|
|
||
Infrastructure services (exclusive of depreciation and amortization of $6,489 and $340, respectively, for the six months ended June 30, 2018 and 2017)
|
406,810
|
|
|
1,712
|
|
||
Natural sand proppant services (exclusive of depreciation, depletion and accretion of $6,193 and $3,566, respectively, for the six months ended June 30, 2018 and 2017)
|
73,752
|
|
|
33,036
|
|
||
Contract land and directional drilling services (exclusive of depreciation of $9,703 and $9,934, respectively, for the six months ended June 30, 2018 and 2017)
|
29,877
|
|
|
22,986
|
|
||
Other services (exclusive of depreciation and amortization of $7,463 and $4,490, respectively, for the six months ended June 30, 2018 and 2017)
|
35,491
|
|
|
14,030
|
|
||
Eliminations
|
(39,782
|
)
|
|
(1,991
|
)
|
||
Total cost of revenue
|
665,929
|
|
|
135,838
|
|
||
Selling, general and administrative expenses
|
103,638
|
|
|
14,437
|
|
||
Depreciation, depletion, amortization and accretion
|
57,703
|
|
|
37,130
|
|
||
Impairment of long-lived assets
|
187
|
|
|
—
|
|
||
Operating income (loss)
|
200,386
|
|
|
(14,177
|
)
|
||
Interest expense, net
|
(2,196
|
)
|
|
(1,509
|
)
|
||
Bargain purchase gain
|
—
|
|
|
4,012
|
|
||
Other expense, net
|
(514
|
)
|
|
(387
|
)
|
||
Income (loss) before income taxes
|
197,676
|
|
|
(12,061
|
)
|
||
Provision (benefit) for income taxes
|
99,430
|
|
|
(5,910
|
)
|
||
Net income (loss)
|
$
|
98,246
|
|
|
$
|
(6,151
|
)
|
|
Six Months Ended
|
||||||
|
June 30, 2018
|
|
June 30, 2017
|
||||
Cash expenses:
|
|
|
|
||||
Compensation and benefits
|
$
|
18,677
|
|
|
$
|
5,381
|
|
Professional services
|
5,568
|
|
|
3,581
|
|
||
Other
(a)
|
5,542
|
|
|
3,880
|
|
||
Total cash SG&A expense
|
29,787
|
|
|
12,842
|
|
||
Non-cash expenses:
|
|
|
|
||||
Bad debt provision
|
53,790
|
|
|
(25
|
)
|
||
Equity based compensation
(b)
|
17,487
|
|
|
—
|
|
||
Stock based compensation
|
2,574
|
|
|
1,620
|
|
||
Total non-cash SG&A expense
|
73,851
|
|
|
1,595
|
|
||
Total SG&A expense
|
$
|
103,638
|
|
|
$
|
14,437
|
|
a.
|
Includes travel-related costs, IT expenses, rent, utilities and other general and administrative-related costs.
|
b.
|
Represents compensation expense for non-employee awards, which were issued and are payable by certain affiliates of Wexford (the sponsor level).
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
Reconciliation of Adjusted EBITDA to net income (loss):
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income (loss)
|
$
|
42,700
|
|
|
$
|
(1,170
|
)
|
|
$
|
98,246
|
|
|
$
|
(6,151
|
)
|
Depreciation, depletion, accretion and amortization expense
|
30,795
|
|
|
19,893
|
|
|
57,703
|
|
|
37,130
|
|
||||
Impairment of long-lived assets
|
187
|
|
|
—
|
|
|
187
|
|
|
—
|
|
||||
Acquisition related costs
|
77
|
|
|
961
|
|
|
31
|
|
|
2,208
|
|
||||
Public offering costs
|
731
|
|
|
—
|
|
|
731
|
|
|
—
|
|
||||
Equity based compensation
|
17,487
|
|
|
—
|
|
|
17,487
|
|
|
—
|
|
||||
Stock based compensation
|
1,660
|
|
|
1,050
|
|
|
2,916
|
|
|
1,620
|
|
||||
Bargain purchase gain
|
—
|
|
|
(4,012
|
)
|
|
—
|
|
|
(4,012
|
)
|
||||
Interest expense, net
|
959
|
|
|
1,112
|
|
|
2,196
|
|
|
1,509
|
|
||||
Other expense, net
|
486
|
|
|
203
|
|
|
514
|
|
|
387
|
|
||||
Provision (benefit) for income taxes
|
53,512
|
|
|
(2,804
|
)
|
|
99,430
|
|
|
(5,910
|
)
|
||||
Adjusted EBITDA
|
$
|
148,594
|
|
|
$
|
15,233
|
|
|
$
|
279,441
|
|
|
$
|
26,781
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
Reconciliation of Adjusted EBITDA to net income (loss):
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income
|
$
|
(11,433
|
)
|
|
$
|
1,187
|
|
|
$
|
(9,474
|
)
|
|
$
|
1,369
|
|
Depreciation and amortization expense
|
13,829
|
|
|
9,626
|
|
|
27,815
|
|
|
18,784
|
|
||||
Acquisition related costs
|
33
|
|
|
—
|
|
|
33
|
|
|
—
|
|
||||
Public offering costs
|
202
|
|
|
—
|
|
|
202
|
|
|
—
|
|
||||
Equity based compensation
|
17,487
|
|
|
—
|
|
|
17,487
|
|
|
—
|
|
||||
Stock based compensation
|
453
|
|
|
503
|
|
|
871
|
|
|
774
|
|
||||
Interest expense
|
341
|
|
|
303
|
|
|
845
|
|
|
431
|
|
||||
Other expense, net
|
80
|
|
|
4
|
|
|
92
|
|
|
7
|
|
||||
Adjusted EBITDA
|
$
|
20,992
|
|
|
$
|
11,623
|
|
|
$
|
37,871
|
|
|
$
|
21,365
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
Reconciliation of Adjusted EBITDA to net income (loss):
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income (loss)
|
$
|
52,359
|
|
|
$
|
(568
|
)
|
|
$
|
99,658
|
|
|
$
|
(702
|
)
|
Depreciation and amortization expense
|
4,094
|
|
|
340
|
|
|
6,501
|
|
|
340
|
|
||||
Acquisition related costs
|
4
|
|
|
42
|
|
|
(4
|
)
|
|
42
|
|
||||
Public offering costs
|
360
|
|
|
—
|
|
|
360
|
|
|
—
|
|
||||
Stock based compensation
|
606
|
|
|
—
|
|
|
1,063
|
|
|
—
|
|
||||
Interest expense
|
106
|
|
|
4
|
|
|
182
|
|
|
4
|
|
||||
Other expense, net
|
330
|
|
|
—
|
|
|
332
|
|
|
—
|
|
||||
Provision for income taxes
|
52,632
|
|
|
—
|
|
|
100,589
|
|
|
—
|
|
||||
Adjusted EBITDA
|
$
|
110,491
|
|
|
$
|
(182
|
)
|
|
$
|
208,681
|
|
|
$
|
(316
|
)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
Reconciliation of Adjusted EBITDA to net income (loss):
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income
|
$
|
10,929
|
|
|
$
|
3,409
|
|
|
$
|
20,301
|
|
|
$
|
2,643
|
|
Depreciation, depletion, accretion and amortization expense
|
3,881
|
|
|
2,206
|
|
|
6,197
|
|
|
3,569
|
|
||||
Acquisition related costs
|
—
|
|
|
916
|
|
|
(38
|
)
|
|
1,954
|
|
||||
Public offering costs
|
95
|
|
|
—
|
|
|
95
|
|
|
—
|
|
||||
Stock based compensation
|
205
|
|
|
182
|
|
|
391
|
|
|
252
|
|
||||
Bargain purchase gain
|
—
|
|
|
(4,012
|
)
|
|
—
|
|
|
(4,012
|
)
|
||||
Interest expense
|
76
|
|
|
353
|
|
|
156
|
|
|
486
|
|
||||
Other expense, net
|
36
|
|
|
140
|
|
|
23
|
|
|
154
|
|
||||
Provision for income taxes
|
—
|
|
|
9
|
|
|
—
|
|
|
9
|
|
||||
Adjusted EBITDA
|
$
|
15,222
|
|
|
$
|
3,203
|
|
|
$
|
27,125
|
|
|
$
|
5,055
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
Reconciliation of Adjusted EBITDA to net income (loss):
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net loss
|
$
|
(5,454
|
)
|
|
$
|
(6,470
|
)
|
|
$
|
(10,904
|
)
|
|
$
|
(13,314
|
)
|
Depreciation and amortization expense
|
5,349
|
|
|
4,974
|
|
|
9,704
|
|
|
9,942
|
|
||||
Impairment of long-lived assets
|
187
|
|
|
—
|
|
|
187
|
|
|
—
|
|
||||
Acquisition related costs
|
—
|
|
|
3
|
|
|
—
|
|
|
25
|
|
||||
Public offering costs
|
34
|
|
|
—
|
|
|
34
|
|
|
—
|
|
||||
Stock based compensation
|
301
|
|
|
180
|
|
|
408
|
|
|
292
|
|
||||
Interest expense, net
|
265
|
|
|
440
|
|
|
660
|
|
|
657
|
|
||||
Other expense, net
|
32
|
|
|
60
|
|
|
72
|
|
|
224
|
|
||||
Adjusted EBITDA
|
$
|
714
|
|
|
$
|
(813
|
)
|
|
$
|
161
|
|
|
$
|
(2,174
|
)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
Reconciliation of Adjusted EBITDA to net income (loss):
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net (loss) income
|
$
|
(3,453
|
)
|
|
$
|
1,272
|
|
|
$
|
(1,346
|
)
|
|
$
|
3,853
|
|
Depreciation and amortization expense
|
3,642
|
|
|
2,747
|
|
|
7,486
|
|
|
4,495
|
|
||||
Acquisition related costs
|
40
|
|
|
—
|
|
|
40
|
|
|
187
|
|
||||
Public offering costs
|
40
|
|
|
—
|
|
|
40
|
|
|
—
|
|
||||
Stock based compensation
|
94
|
|
|
184
|
|
|
183
|
|
|
301
|
|
||||
Interest expense, net
|
171
|
|
|
12
|
|
|
353
|
|
|
(69
|
)
|
||||
Other expense, net
|
8
|
|
|
(1
|
)
|
|
(5
|
)
|
|
2
|
|
||||
(Benefit) provision for income taxes
|
880
|
|
|
(2,813
|
)
|
|
(1,158
|
)
|
|
(5,919
|
)
|
||||
Adjusted EBITDA
|
$
|
1,422
|
|
|
$
|
1,401
|
|
|
$
|
5,593
|
|
|
$
|
2,850
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||
Net income, as reported
|
$
|
42,700
|
|
|
$
|
(1,170
|
)
|
|
$
|
98,246
|
|
|
$
|
(6,151
|
)
|
Equity based compensation
|
17,487
|
|
|
—
|
|
|
17,487
|
|
|
—
|
|
||||
Adjusted net income
|
$
|
60,187
|
|
|
$
|
(1,170
|
)
|
|
$
|
115,733
|
|
|
$
|
(6,151
|
)
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share, as reported
|
$
|
0.95
|
|
|
$
|
(0.03
|
)
|
|
$
|
2.20
|
|
|
$
|
(0.16
|
)
|
Equity based compensation
|
0.40
|
|
|
—
|
|
|
0.40
|
|
|
—
|
|
||||
Adjusted basic earnings per share
|
$
|
1.35
|
|
|
$
|
(0.03
|
)
|
|
$
|
2.60
|
|
|
$
|
(0.16
|
)
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per share, as reported
|
$
|
0.95
|
|
|
$
|
(0.03
|
)
|
|
$
|
2.18
|
|
|
$
|
(0.16
|
)
|
Equity based compensation
|
0.39
|
|
|
—
|
|
|
0.39
|
|
|
—
|
|
||||
Adjusted diluted earnings per share
|
$
|
1.34
|
|
|
$
|
(0.03
|
)
|
|
$
|
2.57
|
|
|
$
|
(0.16
|
)
|
|
June 30,
|
|
December 31,
|
||||
|
2018
|
|
2017
|
||||
Cash and cash equivalents
|
$
|
10,702
|
|
|
$
|
5,637
|
|
Revolving credit facility availability
|
169,233
|
|
|
169,233
|
|
||
Less long-term debt
|
—
|
|
|
(99,900
|
)
|
||
Less letter of credit facilities (environmental remediation)
|
(3,582
|
)
|
|
(3,582
|
)
|
||
Less letter of credit facilities (insurance programs)
|
(2,486
|
)
|
|
(2,486
|
)
|
||
Less letter of credit facilities (rail car commitments)
|
(455
|
)
|
|
(455
|
)
|
||
Net working capital (less cash)
(a)
|
5,688
|
|
|
88,798
|
|
||
Total
|
$
|
179,100
|
|
|
$
|
157,245
|
|
a.
|
Net working capital (less cash) is a non-GAAP measure and is calculated by subtracting total current liabilities of
$365 million
and cash and cash equivalents of
$11 million
from total current assets of
$382 million
as of June 30, 2018. As of December 31, 2017, net working capital (less cash) is calculated by subtracting total current liabilities of
$220 million
and cash and cash equivalents of
$6 million
from total current assets of
$314 million
.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net cash provided by operating activities
|
$
|
125,128
|
|
|
$
|
9,586
|
|
|
$
|
226,451
|
|
|
$
|
24,004
|
|
Net cash used in investing activities
|
(85,755
|
)
|
|
(71,952
|
)
|
|
(121,243
|
)
|
|
(102,693
|
)
|
||||
Net cash provided by (used in) financing activities
|
(39,073
|
)
|
|
57,926
|
|
|
(100,045
|
)
|
|
57,926
|
|
||||
Effect of foreign exchange rate on cash
|
(45
|
)
|
|
62
|
|
|
(98
|
)
|
|
73
|
|
||||
Net change in cash
|
$
|
255
|
|
|
$
|
(4,378
|
)
|
|
$
|
5,065
|
|
|
$
|
(20,690
|
)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Pressure pumping services
(a)
|
$
|
8,233
|
|
|
$
|
24,737
|
|
|
$
|
16,099
|
|
|
$
|
53,402
|
|
Infrastructure services
(b)
|
40,778
|
|
|
3,958
|
|
|
56,556
|
|
|
3,958
|
|
||||
Natural sand proppant services
(c)
|
6,958
|
|
|
2,795
|
|
|
12,658
|
|
|
2,970
|
|
||||
Contract and directional drilling services
(d)
|
7,083
|
|
|
3,632
|
|
|
10,701
|
|
|
5,901
|
|
||||
Other
(e)
|
9,959
|
|
|
344
|
|
|
12,771
|
|
|
344
|
|
||||
Total capital expenditures
|
$
|
73,011
|
|
|
$
|
35,466
|
|
|
$
|
108,785
|
|
|
$
|
66,575
|
|
d.
|
Capital expenditures primarily for upgrades to our rig fleet and real estate purchases for the
six
months ended
June 30, 2018
and upgrades to our rig fleet for the six months ended
June 30, 2017
.
|
Year ended December 31:
|
|
Operating Leases
|
|
Capital Spend Commitments
|
|
Minimum Purchase Commitments
|
||||||
Remainder of 2018
|
|
$
|
12,148
|
|
|
$
|
16,393
|
|
|
$
|
19,254
|
|
2019
|
|
18,091
|
|
|
—
|
|
|
12,125
|
|
|||
2020
|
|
15,622
|
|
|
—
|
|
|
400
|
|
|||
2021
|
|
12,029
|
|
|
—
|
|
|
165
|
|
|||
2022
|
|
8,995
|
|
|
—
|
|
|
—
|
|
|||
Thereafter
|
|
6,057
|
|
|
—
|
|
|
—
|
|
|||
|
|
$
|
72,942
|
|
|
$
|
16,393
|
|
|
$
|
31,944
|
|
|
|
|
|
Incorporated By Reference
|
|
|
|
||||||
Exhibit Number
|
|
Exhibit Description
|
|
Form
|
|
Commission File No.
|
|
Filing Date
|
|
Exhibit No.
|
|
Filed Herewith
|
Furnished Herewith
|
|
|
8-K
|
|
001-37917
|
|
11/15/2016
|
|
3.1
|
|
|
|
||
|
|
8-K
|
|
001-37917
|
|
11/15/2016
|
|
3.2
|
|
|
|
||
|
|
S-1/A
|
|
333-213504
|
|
10/3/2016
|
|
4.1
|
|
|
|
||
|
|
8-K
|
|
001-37917
|
|
11/15/2016
|
|
4.1
|
|
|
|
||
|
|
8-K
|
|
001-37917
|
|
11/15/2016
|
|
4.2
|
|
|
|
||
|
|
8-K
|
|
001-37917
|
|
11/15/2016
|
|
4.3
|
|
|
|
||
|
|
8-K
|
|
001-37917
|
|
5/31/2018
|
|
10.1
|
|
|
|
||
|
|
8-K
|
|
001-37917
|
|
7/13/2018
|
|
10.1
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
X
|
|
||
|
|
|
|
|
|
|
|
|
|
X
|
|
||
|
|
|
|
|
|
|
|
|
|
X
|
|
||
|
|
|
|
|
|
|
|
|
|
X
|
|
||
|
|
|
|
|
|
|
|
|
|
X
|
|
||
|
|
|
|
|
|
|
|
|
|
X
|
|
||
|
|
|
|
|
|
|
|
|
|
X
|
|
||
101.1
|
|
Interactive data files pursuant to Rule 405 of Regulation S-T.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
#
|
|
Confidential treatment requested as to certain portions, which portions have been omitted and filed separately with the Securities and Exchange Commission.
|
|
|
|
|
|
MAMMOTH ENERGY SERVICES, INC.
|
Date:
|
August 7, 2018
|
|
By:
|
|
/s/ Arty Straehla
|
|
|
|
|
|
Arty Straehla
|
|
|
|
|
|
Chief Executive Officer
|
|
|
|
|
|
|
Date:
|
August 7, 2018
|
|
By:
|
|
/s/ Mark Layton
|
|
|
|
|
|
Mark Layton
|
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
SELLER:
|
CUSTOMER:
|
Muskie Proppant, LLC
|
Gulfport Energy Corporation
|
By: /s/ Arty Straehla
Name: Arty Straehla
Title: CEO
|
By: /s/ Michael G. Moore
Name: Michael G. Moore
Title: CEO
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Mammoth Energy Services, Inc. (the “registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
MAMMOTH ENERGY SERVICES, INC.
|
|
By:
|
|
/s/ Arty Straehla
|
|
|
|
Arty Straehla
|
|
|
|
Chief Executive Officer
|
|
|
|
8/7/2018
|
|
|
|
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Mammoth Energy Services, Inc. (the “registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
MAMMOTH ENERGY SERVICES, INC.
|
|
By:
|
|
/s/ Mark Layton
|
|
|
|
Mark Layton
|
|
|
|
Chief Financial Officer
|
|
|
|
8/7/2018
|
|
|
|
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
MAMMOTH ENERGY SERVICES, INC.
|
|
By:
|
|
/s/ Arty Straehla
|
|
|
|
Arty Straehla
|
|
|
|
Chief Executive Officer
|
|
|
|
8/7/2018
|
|
|
|
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
MAMMOTH ENERGY SERVICES, INC.
|
|
By:
|
|
/s/ Mark Layton
|
|
|
|
Mark Layton
|
|
|
|
Chief Financial Officer
|
|
|
|
8/7/2018
|
|
|
|
|
•
|
Section 104 S&S Citations: Citations received from MSHA under section 104 of the Mine Act for violations of mandatory health or safety standards that could significantly and substantially contribute to the cause and effect of a mine safety or health hazard.
|
•
|
Section 104(b) Orders: Orders issued by MSHA under section 104(b) of the Mine Act, which represents a failure to abate a citation under section 104(a) within the period of time prescribed by MSHA. This results in an order of immediate withdrawal from the area of the mine affected by the condition until MSHA determines that the violation has been abated.
|
•
|
Section 104(d) Citations and Orders: Citations and orders issued by MSHA under section 104(d) of the Mine Act for unwarrantable failure to comply with mandatory health or safety standards.
|
•
|
Section 110(b)(2) Violations: Flagrant violations issued by MSHA under section 110(b)(2) of the Mine Act.
|
•
|
Section 107(a) Orders: Orders issued by MSHA under section 107(a) of the Mine Act for situations in which MSHA determined an “imminent danger” (as defined by MSHA) existed.
|
Mine (a)
|
Section 104
S&S
Citations(#)
|
Section104(b)Orders (#)
|
Section104(d)Citations and Orders(#)
|
Section 110(b)(2) Violations(#)
|
Section107(a)Orders (#)
|
Proposed Assessments (2)($, amounts in dollars)
|
Mining Related Fatalities (#)
|
||||||||
Taylor, WI
|
4
|
|
—
|
|
—
|
|
—
|
|
—
|
|
$
|
1,144
|
|
—
|
|
Menomonie, WI
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
$
|
118
|
|
—
|
|
New Auburn, WI
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
$
|
138
|
|
—
|
|
a.
|
The definition of mine under section 3 of the Mine Act includes the mine, as well as other items used in, or to be used in, or resulting from, the work of extracting minerals, such as land, structures, facilities, equipment, machines, tools and minerals preparation facilities. Unless otherwise indicated, any of these other items associated with a single mine have been aggregated in the totals for that mine. MSHA assigns an identification number to each mine and may or may not assign separate identification numbers to related facilities such as preparation facilities. We are providing the information in the table by mine rather than MSHA identification number because that is how we manage and operate our mining business and we believe this presentation will be more useful to investors than providing information based on MSHA identification numbers.
|
b.
|
Represents the total dollar value of proposed assessments from MSHA under the Mine Act relating to any type of citation or order issued during the quarter ended
June 30, 2018
.
|