In the second quarter of 2024, Total Energy Services Inc. (TESI) posted a record performance, with revenue up just 2% from the same period the previous year. The firm credits the successful purchase of Saxon Energy Services, stable industrial conditions in Canada and Australia, and rising demand for compression and process equipment in North America for this expansion.
Total Energy Services Performance
In the second quarter of 2024, Total Energy Services Inc. (TESI) posted a record performance, with revenue up just 2% from the same period the previous year.
The firm credits the successful purchase of Saxon Energy Services, stable industrial conditions in Canada and Australia, and rising demand for compression and process equipment in North America for this expansion.
Total Energy is in a great financial position, with $24.8 million in cash and $71.8 million in working capital. This will allow the company to produce significant free cash flow for the rest of the year. Through share buybacks, the corporation also deliberately decreased the number of outstanding shares by 2.8%.
Important lessons
Consolidated revenue at Total Energy climbed by 2% annually as a result of robust demand for particular equipment and steady overall industry conditions.
In terms of revenue, the United States dominated the world with 46%, followed by Canada with 36% and Australia with 18%. With 51% of the overall revenue, the Compression Process Services (CPS) category was the top revenue producer.
Both sales and EBITDA for the Contract Drilling Services (CDS) division increased significantly. The company’s ability to keep the 12-month total recordable event frequency rate below 1 demonstrates its dedication to safety.
Daniel Halyk, the CEO, thanked the staff for their contributions to the business’s success.
Business Prognosis
With growth prospects in the Australian company and sustained solid demand in North America, the second part of the year appears optimistic. The business expects to produce a large amount of free cash flow.
Negative Aspects
Capital expenditures may be slightly delayed from 2024 to 2025. Going forward, fewer chances for capital expenditures in equipment improvements are anticipated.
Positive Highlights
Exceeding expectations, the acquisition of Saxon Energy Services made it possible to reuse previously dormant equipment.
The CPS segment’s fabrication backlog is still expanding. By year’s end, the company intends to finish the majority of its important projects, with about CAD 30 million left over.
Total Energy Services Inc. is still committed to improving operational effectiveness and pursuing its expansion plan. Daniel Halyk highlighted the company’s solid financial standing and the strategic efforts putting it in a position for long-term success during the earnings call.
With strong second-quarter results and an optimistic outlook for the remainder of the year, Total Energy Services Inc. seems well-positioned to successfully navigate the upcoming market landscape.
