October 29, 2018
FORT WORTH, Texas (AP) _ FTS International Inc. (FTSI) on Monday reported third-quarter net income of $49.6 million.
The Fort Worth-based company said it had profit of 45 cents per share. Earnings, adjusted for asset impairment costs, were 52 cents per share.
“The third quarter was a challenging quarter causing us to reduce fleets for the first time in over two years; however, profitability remains strong and we continue to generate free cash flow and reduce debt levels,” said Michael Doss, FTSI’s CEO.
FTSI said it ran into continued operational pressure in the third quarter 2018 due to earlier than anticipated budget exhaustions by some of its dedicated customers. This softer demand led FTSI to more actively compete for work in the spot market and to stack fleets during the third quarter 2018. The company exited the third quarter 2018 with 19 active fleets.
Average active fleets during the third quarter 2018 were 21.8, down from 28.0 in the second quarter 2018.
FTSI completed 6,991 stages during the third quarter 2018, or 321 stages per active fleet. This compares to 9,356 stages in the second quarter 2018, or 334 stages per active fleet. Lower average active fleets during the quarter, coupled with lower efficiencies due to less exposure to the Marcellus/Utica contributed to the decline in profitability.
“As we look ahead, activity levels are starting to stabilize. Our plan, based on feedback from some major customers, is to reactivate a number of fleets in the first quarter of 2019 and we will ensure that neither the equipment, labor, nor capital will be a limiting factor on the speed of our re-deployments,” said Doss.
“With our in-house manufacturing and refurbishing capabilities, we are well positioned to reactivate fleets rapidly, which we believe is a key competitive advantage that allows us to maximize returns even in short cycles.”
The results did not meet Wall Street expectations. The average estimate of six analysts surveyed by Zacks Investment Research was for earnings of 61 cents per share.
The provider of hydraulic fracturing services posted revenue of $334.4 million in the period, also missing Street forecasts. Four analysts surveyed by Zacks expected $407.9 million.
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This story was generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on FTSI at https://www.zacks.com/ap/FTSI