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CST: 21/10/2019 04:40:45   

Mammoth Energy Services, Inc. Announces Second Quarter 2019 Operational and Financial Results

80 Days ago

  • Second Quarter net loss of $11 million, or $0.24 per diluted share
  • Second Quarter Adjusted EBITDA of $9 million
  • Suspended dividend due to oilfield service market conditions
  • 2019 capital budget decreased 49% from $80 million to $41 million

OKLAHOMA CITY, Aug. 01, 2019 (GLOBE NEWSWIRE) -- Mammoth Energy Services, Inc. ("Mammoth" or the "Company") (NASDAQ: TUSK) today reported financial and operational results for the quarter ended June 30, 2019.

Financial Highlights for the Second Quarter of 2019:

Total revenue was $181.8 million for the three months ended June 30, 2019, down from $262.1 million for the three months ended March 31, 2019 and down from $533.6 million for the three months ended June 30, 2018.

Net loss for the three months ended June 30, 2019 was $10.9 million, or $0.24 per fully diluted share, as compared to net income of $28.3 million, or $0.63 per fully diluted share, for the three months ended March 31, 2019 and net income of $42.7 million, or $0.95 per fully diluted share, for the three months ended June 30, 2018.

Adjusted EBITDA (as defined and reconciled below) was $8.6 million for the three months ended June 30, 2019, down from $82.8 million for the three months ended March 31, 2019 and down from $148.6 million for the three months ended June 30, 2018.

Arty Straehla, Mammoth's Chief Executive Officer, stated, “The second quarter of 2019 was a challenging environment as further capital restraint by our oilfield customers continued to apply downward pressure on pricing and resulted in several completions being delayed or canceled with short notice. In addition, we worked through the challenges of demobilizing our equipment from Puerto Rico. As a result of current market conditions, we have begun to right size our operations and we expect this process to be completed in the coming months. Demand for infrastructure services remains high with the competencies and experience of our crews allowing for unique bidding opportunities in both the US and overseas. While our work in Puerto Rico has ended, we have continued to receive payments from PREPA, with $42 million received in the second quarter of 2019. For the remainder of 2019, we are taking a disciplined approach to our spending and we have reduced our 2019 capital expenditure budget from $80 million to $41 million. As a result of oilfield market conditions, our board of directors has suspended the quarterly cash dividend.”

Infrastructure Services

Mammoth's infrastructure services segment contributed revenues of $41.8 million for the three months ended June 30, 2019, a decrease from $108.7 million for the three months ended March 31, 2019 and a decline from $360.3 million for the three months ended June 30, 2018.

During the second quarter of 2019, Mammoth demobilized approximately 1,000 pieces of equipment from Puerto Rico back to the Lower 48.

Pressure Pumping Services

Mammoth's pressure pumping division contributed revenues (inclusive of inter-segment revenues) of $84.6 million for the three months ended June 30, 2019, a decrease from $92.1 million for the three months ended March 31, 2019 and a decrease from $101.4 million for the three months ended June 30, 2018.

Mammoth's pressure pumping division completed a total of 1,717 stages for the three months ended June 30, 2019, as compared to 1,889 stages for the three months ended March 31, 2019 and 1,815 stages for the three months ended June 30, 2018. An average of 2.7 of our 6 fleets were active for the three months ended June 30, 2019, compared to average utilization of 4.4 fleets during the three months ended March 31, 2019 and an average utilization of 4.3 fleets during the three months ended June 30, 2018.

Natural Sand Proppant Services

Mammoth's natural sand proppant division contributed revenues (inclusive of inter-segment revenues) of $40.4 million for the three months ended June 30, 2019, an increase from $37.9 million for the three months ended March 31, 2019 and a decrease from $52.8 million for the three months ended June 30, 2018.

The Company sold 812,611 tons of sand during the three months ended June 30, 2019, a 22% increase from the 665,806 tons sold during the three months ended March 31, 2019 and a 4% increase from the 777,850 tons sold during the three months ended June 30, 2018. The Company's average sales price for the sand sold during the second quarter of 2019 was $30.09 per ton, a 7% decrease from the $32.20 per ton average sales price during the first quarter of 2019 and a 30% decrease from the $43.09 per ton average sales price during the second quarter of 2018.

Blended second quarter production costs came in at approximately $12 per ton during the second quarter of 2019, unchanged from the first quarter of 2019 production costs and a 24% decrease from production costs of approximately $15.70 per ton during the second quarter of 2018.

Other Services

Mammoth's other services, including contract land and directional drilling, coil tubing, pressure control, flowback, cementing, acidizing, equipment rentals, crude oil hauling and remote accommodations, contributed revenues (inclusive of inter-segment revenues) of $28.4 million for the three months ended June 30, 2019, a decrease from $38.5 million for the three months ended March 31, 2019 and a decrease from $37.3 million for the three months ended June 30, 2018.

An average of 601 pieces of equipment were rented during the three months ended June 30, 2019, down 3% from the average 621 pieces of equipment rented during the three months ended March 31, 2019 and a 77% increase from an average of 339 pieces of equipment rented for the three months ended June 30, 2018. As a result of market conditions, the Company has temporarily shut down its cementing and acidizing operations as well as its flowback operations subsequent to June 30, 2019.

Selling, General and Administrative Expenses

Selling, general and administrative ("SG&A") expenses were $9.5 million for the three months ended June 30, 2019, as compared to $17.3 million for the three months ended March 31, 2019 and $65.1 million for the three months ended June 30, 2018.

Following is a breakout of SG&A expense (in thousands):

  Three Months Ended   Six Months Ended
  June 30,   March 31,   June 30,
  2019   2018   2019   2019   2018
Cash expenses:                  
Compensation and benefits $ 2,154     $ 10,978     $ 9,230     $ 11,384     $ 18,677  
Professional services 2,934     2,981     3,789     6,723     5,568  
Other(a) 3,381     3,935     3,244     6,626     5,542  
Total cash SG&A expense 8,469     17,894     16,263     24,733     29,787  
Non-cash expenses:                  
Bad debt provision(b) 262     28,263     4     266     53,790  
Equity based compensation(c)     17,487             17,487  
Stock based compensation 724     1,483     1,069     1,792     2,574  
Total non-cash SG&A expense 986     47,233     1,073     2,058     73,851  
Total SG&A expense $ 9,455     $ 65,127     $ 17,336     $ 26,791     $ 103,638  

a.     Includes travel-related costs, IT expenses, rent, utilities and other general and administrative-related costs.
b.     $28.3 million and $53.6 million of the bad debt expense recognized during the three and six months ended June 30, 2018 was subsequently reversed during the third quarter of 2018.
c.     Represents compensation expense for non-employee awards, which were issued and are payable by certain affiliates of Wexford (the sponsor level).

SG&A expenses, as a percentage of total revenue, were 5% for the three months ended June 30, 2019 as compared to 7% for the three months ended March 31, 2019 and 12% for the three months ended June 30, 2018.

Liquidity

As of June 30, 2019, Mammoth had cash on hand totaling $7.2 million and outstanding borrowings under its revolving credit facility of $82.0 million. As of June 30, 2019, the Company had $93.5 million of available borrowing capacity under its revolving credit facility, after giving effect to $8.7 million of outstanding letters of credit, resulting in total liquidity of approximately $100.7 million. As of July 31, 2019, the Company had cash on hand totaling $11.6 million and outstanding borrowings under its revolving credit facility of $85.5 million.

Capital Expenditures

The following table summarizes Mammoth's capital expenditures by operating division for the periods indicated (in thousands):

  Three Months Ended   Six Months Ended
  June 30,   March 31,   June 30,
  2019   2018   2019   2019   2018
Infrastructure services(a) $ 2,177     $ 40,778     $ 3,254     $ 5,431     $ 56,556  
Pressure pumping services(b) 4,013     8,233     7,329     11,342     16,099  
Natural sand proppant services(c) 990     6,958     985     1,975     12,658  
Other(d) 2,767     17,042     8,705     11,472     23,472  
Total capital expenditures $ 9,947     $ 73,011     $ 20,273     $ 30,220     $ 108,785  

a.     Capital expenditures primarily for truck, tooling and other equipment for the periods presented.
b.     Capital expenditures primarily for pressure pumping and water transfer equipment for the for the periods presented.
c.     Capital expenditures primarily for maintenance for the 2019 periods presented and plant upgrades for the 2018 periods presented.
d.     Capital expenditures primarily for equipment for the Company's rental business and upgrades to its rig fleet for the periods presented.

Explanatory Note Regarding Financial Information

The financial information contained in this release should be read in conjunction with the financial information contained in Mammoth’s Annual Report to be filed on Form 10-K with the Securities and Exchange Commission ("SEC"), Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings.

The Company's Chief Executive Officer and Chief Financial Officer comprise the Company's Chief Operating Decision Maker function ("CODM"). Segment information is prepared on the same basis that the CODM manages the segments, evaluates the segment financial statements and makes key operating and resource utilization decisions. Segment evaluation is determined on a quantitative basis based on a function of operating income (loss) as well as a qualitative basis, such as nature of the product and service offerings and types of customers.

Conference Call Information

Mammoth will host a conference call on Friday, August 2, 2019 at 10:00 a.m. CDT (11:00 am EDT) to discuss its second quarter 2019 financial and operational results. The telephone number to access the conference call is 844-265-1561 in the U.S. and the international dial in is 216-562-0385. The conference ID for the call is 6178026. The conference call will also be webcast live on www.mammothenergy.com in the “Investors” section.

About Mammoth Energy Services, Inc.

Mammoth is an integrated, growth-oriented energy service company serving companies engaged in the exploration and development of North American onshore unconventional oil and natural gas reserves and government-funded utilities, private utilities, public investor-owned utilities and co-operative utilities through its energy infrastructure services. Mammoth’s suite of services and products include: pressure pumping services, infrastructure services, natural sand and proppant services and other energy services.

For additional information about Mammoth, please visit its website at www.mammothenergy.com, where Mammoth routinely posts announcements, updates, events, investor information and presentations and recent news releases.

Investor Contact:
Don Crist
Director of Investor Relations
dcrist@mammothenergy.com 
405-608-6048

Media Contact:
Peter Mirijanian
peter@pmpadc.com 
(202) 464-8803

Forward-Looking Statements and Cautionary Statements

This news release (and any oral statements made regarding the subjects of this release, including on the conference call announced herein) contains certain statements and information that may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements. The words “anticipate,” “believe,” “ensure,” “expect,” “if,” “intend,” “plan,” “estimate,” “project,” “forecasts,” “predict,” “outlook,” “aim,” “will,” “could,” “should,” “potential,” “would,” “may,” “probable,” “likely” and similar expressions, and the negative thereof, are intended to identify forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include statements, estimates and projections regarding our business outlook and plans, future financial position, liquidity and capital resources, operations, performance, acquisitions, returns, capital expenditure budgets, costs and other guidance regarding future developments. Forward-looking statements are not assurances of future performance. These forward-looking statements are based on management’s current expectations and beliefs, forecasts for our existing operations, experience and perception of historical trends, current conditions, anticipated future developments and their effect on us, and other factors believed to be appropriate. Although management believes that the expectations and assumptions reflected in these forward-looking statements are reasonable as and when made, no assurance can be given that these assumptions are accurate or that any of these expectations will be achieved (in full or at all). Moreover, our forward-looking statements are subject to significant risks and uncertainties, including those described in our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings we make with the SEC, including those relating to our acquisitions and our contracts, many of which are beyond our control, which may cause actual results to differ materially from our historical experience and our present expectations or projections which are implied or expressed by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: the failure to receive or delays in receiving governmental authorizations, approvals and/or payments; the outcome of an ongoing government investigation relating to the contracts awarded to our subsidiary Cobra Acquisitions LLC by the Puerto Rico Electric Power Authority; our inability to replace the prior levels of work in our infrastructure segment; risks relating to economic conditions; the loss of or interruption in operations of one or more key suppliers or customers; the effects of government regulation, permitting and other legal requirements; operating risks; the adequacy of capital resources and liquidity; weather; natural disasters; litigation; competition in the oil and natural gas and infrastructure industries; and costs and availability of resources.

Investors are cautioned not to place undue reliance on any forward-looking statement which speaks only as of the date on which such statement is made. We undertake no obligation to correct, revise or update any forward-looking statement after the date such statement is made, whether as a result of new information, future events or otherwise, except as required by applicable law.



MAMMOTH ENERGY SERVICES, INC.
CONSOLIDATED BALANCE SHEETS

ASSETS   June 30,   December 31,
    2019   2018
     
CURRENT ASSETS   (in thousands)
Cash and cash equivalents   $ 7,245     $ 67,625  
Accounts receivable, net   385,626     337,460  
Receivables from related parties   37,400     11,164  
Inventories   22,114     21,302  
Prepaid expenses   10,196     11,317  
Other current assets   699     688  
Total current assets   463,280     449,556  
         
Property, plant and equipment, net   408,408     436,699  
Sand reserves   69,762     71,708  
Operating lease right-of-use assets   52,184      
Intangible assets, net - customer relationships   1,563     1,711  
Intangible assets, net - trade names   5,625     6,045  
Goodwill   101,245     101,245  
Other non-current assets   6,843     6,127  
Total assets   $ 1,108,910     $ 1,073,091  
LIABILITIES AND EQUITY        
CURRENT LIABILITIES        
Accounts payable   $ 72,671     $ 68,843  
Payables to related parties   1,020     370  
Accrued expenses and other current liabilities   42,658     59,652  
Current operating lease liability   17,338      
Income taxes payable   30,780     104,958  
Total current liabilities   164,467     233,823  
         
Long-term debt   82,036      
Deferred income tax liabilities   56,580     79,309  
Long-term operating lease liability   34,807      
Asset retirement obligation   3,534     3,164  
Other liabilities   4,270     2,743  
Total liabilities   345,694     319,039  
         
COMMITMENTS AND CONTINGENCIES        
         
EQUITY        
Equity:        
Common stock, $0.01 par value, 200,000,000 shares authorized, 45,004,795 and 44,876,649 issued and outstanding at June 30, 2019 and December 31, 2018   450     449  
Additional paid in capital   533,151     530,919  
Retained earnings   232,990     226,765  
Accumulated other comprehensive loss   (3,375 )   (4,081 )
Total equity   763,216     754,052  
Total liabilities and equity   $ 1,108,910     $ 1,073,091  



MAMMOTH ENERGY SERVICES, INC. 
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

  Three Months Ended   Six Months Ended
  June 30,   March 31,   June 30,
  2019   2018   2019   2019   2018
   
  (in thousands, except per share amounts)
REVENUE  
Services revenue $ 115,760     $ 455,545     $ 193,101     $ 308,861     $ 864,204  
Services revenue - related parties 36,837     40,611     44,073     80,910     89,699  
Product revenue 18,362     27,708     12,309     30,671     52,748  
Product revenue - related parties 10,861     9,730     12,655     23,516     21,192  
Total revenue 181,820     533,594     262,138     443,958     1,027,843  
                   
COST AND EXPENSES                  
Services cost of revenue (exclusive of depreciation, depletion, amortization and accretion of $25,597, $26,898, $25,682, $51,280 and $51,473, respectively, for the three months ended June 30, 2019, June 30, 2018 and March 31, 2019 and six months ended June 30, 2019 and 2018) 132,688     302,283     158,106     290,794     593,262  
Services cost of revenue - related parties (exclusive of depreciation, depletion, amortization and accretion of $0, $0, $0, $0 and $0, respectively, for the three months ended June 30, 2019, June 30, 2018 and March 31, 2019 and six months ended June 30, 2019 and 2018) 2,650     2,428     713     3,363     4,220  
Product cost of revenue (exclusive of depreciation, depletion, amortization and accretion of $4,525, $3,879, $2,871, $7,395 and $6,193, respectively, for the three months ended June 30, 2019, June 30, 2018 and March 31, 2019 and six months ended June 30, 2019 and 2018) 32,677     35,117     30,251     62,928     68,447  
Selling, general and administrative 8,796     64,595     16,902     25,698     102,677  
Selling, general and administrative - related parties 659     532     434     1,093     961  
Depreciation, depletion, amortization and accretion 30,145     30,795     28,576     58,721     57,703  
Impairment of long-lived assets     187             187  
Total cost and expenses 207,615     435,937     234,982     442,597     827,457  
Operating (loss) income (25,795 )   97,657     27,156     1,361     200,386  
                   
OTHER INCOME (EXPENSE)                  
Interest expense, net (1,551 )   (959 )   (523 )   (2,074 )   (2,196 )
Other, net 4,019     (486 )   24,557     28,576     (514 )
Total other income (expense) 2,468     (1,445 )   24,034     26,502     (2,710 )
(Loss) income before income taxes (23,327 )   96,212     51,190     27,863     197,676  
(Benefit) provision for income taxes (12,438 )   53,512     22,857     10,419     99,430  
Net (loss) income $ (10,889 )   $ 42,700     $ 28,333     $ 17,444     $ 98,246  
                   
OTHER COMPREHENSIVE INCOME (LOSS)                  
Foreign currency translation adjustment, net of tax of $92, $86, ($90), $182 and $272, respectively, for the three months ended June 30, 2019, June 30, 2018 and March 31, 2019 and six months ended June 30, 2019 and 2018 350     (325 )   356     706     (786 )
Comprehensive (loss) income $ (10,539 )   $ 42,375     $ 28,689     $ 18,150     $ 97,460  
                   
Net (loss) income per share (basic) $ (0.24 )   $ 0.95     $ 0.63     $ 0.39     $ 2.20  
Net (loss) income per share (diluted) $ (0.24 )   $ 0.95     $ 0.63     $ 0.39     $ 2.18  
Weighted average number of shares outstanding (basic) 45,003     44,737     44,929     44,966     44,700  
Weighted average number of shares outstanding (diluted) 45,003     45,059     45,063     45,060     44,977  
Dividends declared per share $ 0.125         $ 0.125     $ 0.25      



MAMMOTH ENERGY SERVICES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS

  Six Months Ended
  June 30,
  2019   2018
   
  (in thousands)
Cash flows from operating activities:      
Net income $ 17,444     $ 98,246  
Adjustments to reconcile net income to cash provided by operating activities:      
Equity based compensation     17,487  
Stock based compensation 2,233     2,916  
Depreciation, depletion, accretion and amortization 58,721     57,703  
Amortization of coil tubing strings 1,003     1,120  
Amortization of debt origination costs 163     199  
Bad debt expense 266     53,790  
Loss (gain) on disposal of property and equipment 176     (128 )
Impairment of long-lived assets     187  
Deferred income taxes (22,911 )   (27,906 )
Other (199 )    
Changes in assets and liabilities, net of acquisitions of businesses:      
Accounts receivable, net (48,530 )   (122,908 )
Receivables from related parties (26,236 )   3,114  
Inventories (1,815 )   4,156  
Prepaid expenses and other assets 1,115     (1,195 )
Accounts payable 7,366     34,186  
Payables to related parties 650     538  
Accrued expenses and other liabilities (17,129 )   10,193  
Income taxes payable (74,172 )   94,753  
Net cash (used in) provided by operating activities (101,855 )   226,451  
       
Cash flows from investing activities:      
Purchases of property and equipment (30,085 )   (105,349 )
Purchases of property and equipment from related parties (135 )   (3,436 )
Business acquisitions     (13,356 )
Contributions to equity investee (680 )    
Proceeds from disposal of property and equipment 2,465     898  
Net cash used in investing activities (28,435 )   (121,243 )
       
Cash flows from financing activities:      
Borrowings from lines of credit 108,000     52,000  
Repayments of lines of credit (25,964 )   (151,900 )
Dividends paid (11,219 )    
Principal payments on financing leases and equipment financing notes (992 )   (145 )
Net cash provided by (used in) financing activities 69,825     (100,045 )
Effect of foreign exchange rate on cash 85     (98 )
Net change in cash and cash equivalents (60,380 )   5,065  
Cash and cash equivalents at beginning of period 67,625     5,637  
Cash and cash equivalents at end of period $ 7,245     $ 10,702  
       
Supplemental disclosure of cash flow information:      
Cash paid for interest $ 1,830     $ 2,543  
Cash paid for income taxes $ 116,442     $ 32,584  
Supplemental disclosure of non-cash transactions:      
Purchases of property and equipment included in accounts payable $ 2,339     $ 20,897  



MAMMOTH ENERGY SERVICES, INC.
SEGMENT INCOME STATEMENTS
(in thousands)

Three months ended June 30, 2019 Infrastructure Pressure Pumping Sand All Other Eliminations Total
Revenue from external customers $ 41,821   $ 82,973   $ 29,223   $ 27,803   $   $ 181,820  
Intersegment revenues   1,668   11,170   584   (13,422 )  
Total revenue 41,821   84,641   40,393   28,387   (13,422 ) 181,820  
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion 44,864   59,835   32,676   30,640     168,015  
Intersegment cost of revenues   11,797   1,141   562   (13,500 )  
Total cost of revenue 44,864   71,632   33,817   31,202   (13,500 ) 168,015  
Selling, general and administrative 3,035   2,664   1,380   2,376     9,455  
Depreciation, depletion, amortization and accretion 7,818   10,174   4,528   7,625     30,145  
Operating (loss) income (13,896 ) 171   668   (12,816 ) 78   (25,795 )
Interest expense, net 386   452   72   641     1,551  
Other (income) expense, net (4,045 ) 9   (32 ) 49     (4,019 )
(Loss) income before income taxes $ (10,237 ) $ (290 ) $ 628   $ (13,506 ) $ 78   $ (23,327 )


Three months ended June 30, 2018 Infrastructure Pressure Pumping Sand All Other Eliminations Total
Revenue from external customers $ 360,250   $ 100,333   $ 37,439   $ 35,572   $   $ 533,594  
Intersegment revenues   1,073   15,406   1,776   (18,255 )  
Total revenue 360,250   101,406   52,845   37,348   (18,255 ) 533,594  
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion 210,189   61,593   35,117   32,929     339,828  
Intersegment cost of revenues 754   16,174   1,019   60   (18,007 )  
Total cost of revenue 210,943   77,767   36,136   32,989   (18,007 ) 339,828  
Selling, general and administrative 39,786   20,822   1,787   2,732     65,127  
Depreciation, depletion, amortization and accretion 4,094   13,829   3,881   8,991     30,795  
Impairment of long-lived assets       187     187  
Operating income (loss) 105,427   (11,012 ) 11,041   (7,551 ) (248 ) 97,657  
Interest expense, net 106   341   76   436     959  
Other expense, net 330   80   36   40     486  
Income (loss) before income taxes $ 104,991   $ (11,433 ) $ 10,929   $ (8,027 ) $ (248 ) $ 96,212  


Three months ended March 31, 2019 Infrastructure Pressure Pumping Sand All Other Eliminations Total
Revenue from external customers $ 108,721   $ 90,595   $ 24,964   $ 37,858   $   $ 262,138  
Intersegment revenues   1,544   12,897   658   (15,099 )  
Total revenue 108,721   92,139   37,861   38,516   (15,099 ) 262,138  
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion 58,965   64,211   30,252   35,642     189,070  
Intersegment cost of revenues   13,537   1,047   497   (15,081 )  
Total cost of revenue 58,965   77,748   31,299   36,139   (15,081 ) 189,070  
Selling, general and administrative 9,517   3,213   1,519   3,087     17,336  
Depreciation, depletion, amortization and accretion 7,719   9,893   2,873   8,091     28,576  
Operating income (loss) 32,520   1,285   2,170   (8,801 ) (18 ) 27,156  
Interest expense, net 39   198   30   256     523  
Other expense, net (24,824 ) (1 )   268     (24,557 )
Income (loss) before income taxes $ 57,305   $ 1,088   $ 2,140   $ (9,325 ) $ (18 ) $ 51,190  


Six months ended June 30, 2019 Infrastructure Pressure Pumping Sand All Other Eliminations Total
Revenue from external customers $ 150,542   $ 173,568   $ 54,187   $ 65,661   $   $ 443,958  
Intersegment revenues   3,212   24,067   1,243   (28,522 )  
Total revenue 150,542   176,780   78,254   66,904   (28,522 ) 443,958  
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion 103,828   124,047   62,928   66,282     357,085  
Intersegment cost of revenues   25,334   2,188   1,060   (28,582 )  
Total cost of revenue 103,828   149,381   65,116   67,342   (28,582 ) 357,085  
Selling, general and administrative 12,553   5,876   2,899   5,463     26,791  
Depreciation, depletion, amortization and accretion 15,537   20,068   7,401   15,715     58,721  
Operating income (loss) 18,624   1,455   2,838   (21,616 ) 60   1,361  
Interest expense, net 425   649   102   898     2,074  
Other (income) expense, net (28,869 ) 8   (32 ) 317     (28,576 )
Income (loss) before income taxes $ 47,068   $ 798   $ 2,768   $ (22,831 ) $ 60   $ 27,863  


Six months ended June 30, 2018 Infrastructure Pressure Pumping Sand All Other Eliminations Total
Revenue from external customers $ 685,709   $ 196,912   $ 73,942   $ 71,280   $   $ 1,027,843  
Intersegment revenues   5,632   29,918   4,193   (39,743 )  
Total revenue 685,709   202,544   103,860   75,473   (39,743 ) 1,027,843  
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion 404,265   128,205   68,447   65,012     665,929  
Intersegment cost of revenues 2,545   31,576   5,305   327   (39,753 )  
Total cost of revenue 406,810   159,781   73,752   65,339   (39,753 ) 665,929  
Selling, general and administrative 71,637   23,485   3,431   5,085     103,638  
Depreciation, depletion, amortization and accretion 6,501   27,815   6,197   17,190     57,703  
Impairment of long-lived assets       187     187  
Operating income (loss) 200,761   (8,537 ) 20,480   (12,328 ) 10   200,386  
Interest expense, net 182   845   156   1,013     2,196  
Other expense (income), net 332   92   23   67     514  
Income (loss) before income taxes $ 200,247   $ (9,474 ) $ 20,301   $ (13,408 ) $ 10   $ 197,676  


Adjusted EBITDA

Adjusted EBITDA is a supplemental non-GAAP financial measure that is used by management and external users of the Company's financial statements, such as industry analysts, investors, lenders and rating agencies. Mammoth defines Adjusted EBITDA as net income (loss) before depreciation, depletion, amortization and accretion expense, impairment of long-lived assets, acquisition related costs, public offering costs, equity based compensation, stock based compensation, interest expense, net, other (income) expense, net (which is comprised of the (gain) or loss on disposal of long-lived assets) and provision (benefit) for income taxes, further adjusted to add back interest on trade accounts receivable. The Company excludes the items listed above from net income (loss) in arriving at Adjusted EBITDA because these amounts can vary substantially from company to company within the energy service industry depending upon accounting methods and book values of assets, capital structures and the method by which the assets were acquired. Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, net income (loss) or cash flows from operating activities as determined in accordance with GAAP or as an indicator of Mammoth's operating performance or liquidity. Certain items excluded from Adjusted EBITDA are significant components in understanding and assessing a company’s financial performance, such as a company’s cost of capital and tax structure, as well as the historic costs of depreciable assets, none of which are components of Adjusted EBITDA. Mammoth's computations of Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. The Company believes that Adjusted EBITDA is a widely followed measure of operating performance and may also be used by investors to measure its ability to meet debt service requirements.

The following tables provide a reconciliation of Adjusted EBITDA to the GAAP financial measure of net income (loss) on a consolidated basis and for each of the Company's segments (in thousands):

Consolidated

  Three Months Ended   Six Months Ended
  June 30,   March 31,   June 30,
Reconciliation of Adjusted EBITDA to net income (loss): 2019   2018   2019   2019   2018
Net (loss) income $ (10,889 )   $ 42,700     $ 28,333     $ 17,444     $ 98,246  
Depreciation, depletion, accretion and amortization expense 30,145     30,795     28,576     58,721     57,703  
Impairment of long-lived assets     187             187  
Acquisition related costs 45     77         45     31  
Public offering costs     731             731  
Equity based compensation     17,487             17,487  
Stock based compensation 944     1,660     1,289     2,233     2,916  
Interest expense, net 1,551     959     523     2,074     2,196  
Other (income) expense, net (4,019 )   486     (24,557 )   (28,576 )   514  
Interest on trade accounts receivable 3,234         25,735     28,969      
(Benefit) provision for income taxes (12,438 )   53,512     22,857     10,419     99,430  
Adjusted EBITDA $ 8,573     $ 148,594     $ 82,756     $ 91,329     $ 279,441  


Infrastructure Services

  Three Months Ended   Six Months Ended
  June 30,   March 31,   June 30,
Reconciliation of Adjusted EBITDA to net income: 2019   2018   2019   2019   2018
Net income $ 6,210     $ 52,359     $ 35,665     $ 41,875     $ 99,658  
Depreciation and amortization expense 7,818     4,094     7,719     15,537     6,501  
Acquisition related costs 12     4         12     (4 )
Public offering costs     360             360  
Stock based compensation 9     606     462     471     1,063  
Interest expense 386     106     39     425     182  
Other (income) expense, net (4,045 )   330     (24,824 )   (28,869 )   332  
Interest on trade accounts receivable 3,234         25,735     28,969      
(Benefit) provision for income taxes (16,447 )   52,632     21,639     5,193     100,589  
Adjusted EBITDA $ (2,823 )   $ 110,491     $ 66,435     $ 63,613     $ 208,681  


Pressure Pumping Services

  Three Months Ended   Six Months Ended
  June 30,   March 31,   June 30,
Reconciliation of Adjusted EBITDA to net income (loss): 2019   2018   2019   2019   2018
Net income (loss) $ (290 )   $ (11,433 )   $ 1,088     $ 798     $ (9,474 )
Depreciation and amortization expense 10,174     13,829     9,893     20,068     27,815  
Acquisition related costs 18     33         18     33  
Public offering costs     202             202  
Equity based compensation     17,487             17,487  
Stock based compensation 489     453     410     899     871  
Interest expense 452     341     198     649     845  
Other expense (income), net 9     80     (1 )   8     92  
Adjusted EBITDA $ 10,852     $ 20,992     $ 11,588     $ 22,440     $ 37,871  


Natural Sand Proppant Services

  Three Months Ended   Six Months Ended
  June 30,   March 31,   June 30,
Reconciliation of Adjusted EBITDA to net income (loss): 2019   2018   2019   2019   2018
Net income $ 628     $ 10,929     $ 2,140     $ 2,768     $ 20,301  
Depreciation, depletion, accretion and amortization expense 4,528     3,881     2,873     7,401     6,197  
Acquisition related costs 8             8     (38 )
Public offering costs     95             95  
Stock based compensation 236     205     203     439     391  
Interest expense 72     76     30     102     156  
Other (income) expense, net (32 )   36         (32 )   23  
Adjusted EBITDA $ 5,440     $ 15,222     $ 5,246     $ 10,686     $ 27,125  


Other Services(a)

  Three Months Ended   Six Months Ended
  June 30,   March 31,   June 30,
Reconciliation of Adjusted EBITDA to net income (loss): 2019   2018   2019   2019   2018
Net (loss) income $ (17,515 )   $ (8,907 )   $ (10,542 )   $ (28,057 )   $ (12,250 )
Depreciation and amortization expense 7,625     8,991     8,091     15,715     17,190  
Impairment of long-lived assets     187             187  
Acquisition related costs 7     40         7     40  
Public offering costs     74             74  
Stock based compensation 210     396     214     424     592  
Interest expense, net 641     436     256     898     1,013  
Other expense, net 49     40     268     317     67  
Provision (benefit) for income taxes 4,009     880     1,217     5,226     (1,158 )
Adjusted EBITDA $ (4,974 )   $ 2,137     $ (496 )   $ (5,470 )   $ 5,755  

a.     Includes results for Mammoth's contract land and directional drilling, coil tubing, pressure control, flowback, cementing, acidizing, equipment rentals, crude oil hauling and remote accommodations services and corporate related activities. The Company's corporate related activities do not generate revenue.

After Tax Return on Invested Capital

After tax return on invested capital is a supplemental non-GAAP measure that is used by management to evaluate the Company's performance. Mammoth defines after tax return on invested capital as net income divided by total capital employed, which is the average of ending debt and equity for the last two years. Management believes after tax return on invested capital is a useful measure of how effectively the Company uses capital to generate profits and it provides additional insight for analysts and investors in evaluating the Company's financial and operating performance. After tax return on invested capital should not be considered in isolation or as a substitute for financial measures reported in accordance with GAAP. The following table provides the calculation of after tax return on invested capital using the GAAP financial measures of net income, total debt and total equity.

  Twelve Months Ended
  June 30,
  2019   2018   2017
   
  (in thousands)
Net income $ 155,163     $ 163,360      
Capital Employed          
Total debt $ 82,036     $     $ 65,000  
Total equity 763,216     625,669     440,410  
Total capital employed $ 845,252     $ 625,669     $ 505,410  
           
Average capital employed(a) $ 735,461     $ 565,540      
Trailing twelve month after tax return on invested capital(b) 21 %   29 %    

a.     Average capital employed is the average of total capital employed as of end of the period and end of the prior period.
b.     After tax return on invested capital is the ratio of net income for the period to average capital employed.

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