Source Energy Services Reports Strong Year-End Growth
Source Energy Services' Strong Year-End Results
Source Energy Services Ltd. is thrilled to share its impressive financial outcomes for the year concluding December 31, 2024. This marks a significant milestone for the company as it experiences robust growth across various performance metrics.
Financial Achievements in 2024
During the past year, Source Energy Services achieved remarkable financial results:
- Sand Sales Volumes: The company realized sand sales volumes of 3,527,248 metric tonnes, generating $532.9 million in sand revenue, marking a 16% increase from 2023.
- Total Revenue Growth: Source recorded total revenue of $674.0 million, an increase of $104.2 million compared to the previous year.
- Gross Margins: Gross margin surged to $127.3 million, alongside an Adjusted Gross Margin of $162.6 million, reflecting increases of 16% and 20% respectively.
- Net Income: The company reported a net income of $9.5 million, a positive indicator of its business performance.
- Adjusted EBITDA: Adjusted EBITDA rose significantly to $123.9 million, an improvement of $24.8 million from 2023.
- Refinancing and Liquidity: Source successfully refinanced its existing credit facilities, securing a new five-year, US$135.0 million Term Loan and a $40.0 million credit facility, improving liquidity by $68.8 million.
- Partnerships and Infrastructure Developments: The company announced a strategic partnership with Trican Well Service Ltd. to build a new terminal facility capable of housing unit trains in Taylor, British Columbia. They also completed key acquisitions, enhancing their trucking assets in the process.
Quarterly Overview
Source achieved remarkable quarterly results as well. The company harvested sand sales volumes of 767,712 metric tonnes, resulting in revenue of $117.7 million during the last quarter. This marks a slight decrease from an exceptionally strong fourth quarter in 2023 but demonstrates resilience in an evolving market.
Expansion of Services and Facilities
Source's operational footprint continues to grow. The ongoing construction of the Taylor Facility, with an impressive capacity for 55,000 metric tonnes of sand storage and a throughput exceeding 12,000 tonnes daily, will significantly enhance Source's logistical capabilities. Additionally, the company deployed its tenth and eleventh Sahara units on the North Slope in Alaska, achieving superb utilization rates across its fleet.
Operational and Financial Forecast
Looking ahead, Source Energy Services anticipates increased activity levels in the Montney basin in 2025 driven by new large exploration and production customers. The company aims to leverage its strategic positions established through recent acquisitions and developments. With anticipated growth in demand for natural gas and logistical services, Source is positioned to capitalize on upcoming opportunities.
Moreover, Source is keen to maintain its edge by diversifying its service offerings and enhancing logistics support, thus ensuring timely delivery of frac sand and completion materials directly to well sites. The company is committed to fostering strong relationships with its customers while navigating any uncertainties that may arise in the landscape of natural gas exports and market dynamics.
Commitment to Sustainable Practices
Source Energy Services recognizes the importance of responsible practices in the energy sector. By focusing on reduced carbon intensity and adhering to sustainable mining and logistical operations, the company positions itself favorably amid growing environmental consciousness among investors and consumers alike.
Frequently Asked Questions
What were Source's key financial highlights for 2024?
Key achievements included a total revenue of $674 million, sand sales volumes of 3.5 million metric tonnes, and an adjusted EBITDA of $123.9 million.
How does Source plan to enhance its operational footprint?
The company is constructing the Taylor Facility for increased sand storage capacity and collaborating with Trican Wel Service for enhanced logistics capabilities.
What factors contributed to Source's revenue growth in 2024?
Growth was driven by strong customer activity levels and the addition of new customers in the Western Canadian Sedimentary Basin.
How did Source mitigate cost pressures in 2024?
Cost management efforts included optimizing production efficiencies and reducing production costs gained from recent acquisitions.
What is Source's outlook for 2025?
Source anticipates deeper customer engagement and increased demand for natural gas, positioning itself to capitalize on market opportunities in the forthcoming year.
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