Why ProFrac Shares Are Down Today

ProFrac Holding Corp. ACDC shares are trading lower after the company reported fourth-quarter FY23 results.

Revenue of $489 million missed the consensus of $594.97 million. Adjusted EBITDA of $110 million declined from $263.4 the prior year quarter.

The company reported a net loss of $(99.1) million vs. an income of $40.9 million the prior year quarter.

In the quarter, operating cash flow was $43 million, and capital expenditures were $33 million.

As of Dec. 31, 2023, ProFrac had $103 million of liquidity, including $19 million in cash and cash equivalents (excluding Flotek) and $83 million of availability under its asset-based credit facility.

Outlook: ProFrac expects higher profitability levels in 2024 in the Stimulation Services segment, with the projected higher fleet count, increased pumping hours, and the cost actions anticipated to offset any pricing pressures.

In the Proppant Production segment, the company anticipates modest improvement to mine utilization in the first quarter of 2024, with pricing per ton in the $25-$30 range and further improvement in utilization to 65%-75% in the second quarter of 2024.

Matt Wilks, executive chairman said, “Our fourth quarter results were challenged, as we expected, due to softness that persisted throughout the second half of the year.”

“To start the year, in January we surpassed our highest pumping efficiency since the fourth quarter of 2022 and in February we pushed the bar even higher as we increased our pumping hours per active fleet to the highest level ever recorded at ProFrac, nearly 20% over our 2023 average.”

ACDC Price Action: Profrac Holding shares are down 0.94% at $7.86 at last check Wednesday. 

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