#United States #Houston #financial results #Q1 2025 #KLX Energy Services

KLX Energy Services Holdings, Inc. Reports First Quarter 2025 Results

KLX Energy Services Holdings, Inc. (Nasdaq: KLXE) released its financial results for the first quarter of 2025, revealing a significantly mixed performance amidst ongoing challenges in the energy sector. The company documented revenues of $154 million, marking a 6.9% decrease from the preceding quarter. This decline reflects the seasonal slowdown in market activity as well as reduced completions and directional drilling activity in the Mid-Continent region.

Key Financial Highlights

In its report, KLX announced a net loss of $(27.9 million), translating to a diluted loss per share of $(1.62). These figures depict a concerning trend as the previous quarter also recorded losses amounting to $(14.7 million). Conversely, the adjusted EBITDA for the first quarter reciprocated positively with a 14% increase, totaling $13.8 million compared to the same period last year, showcasing a 208 basis point surge in adjusted EBITDA margin to 9.0%.

Segment Performance

As part of its detailed analysis, KLX provided insights into its performance across three geographic business segments:

• - Rocky Mountains: Revenue for this segment stood at $47.8 million, reflecting an 11.5% sequential decrease but an increase of 5% year-over-year. The segment's operating loss was recorded at $(0.2 million) with an adjusted EBITDA of $6.7 million.

• - Southwest: Highlighting a significant upturn, the Southwest segment generated $65.2 million in revenue, a 6.2% sequential improvement propelled by strategic market share expansions in key areas like the Permian Basin. With an operating income of $3.0 million, the segment achieved an adjusted EBITDA of $11.7 million, marking a striking 75% year-over-year increment.

• - Northeast/Mid-Con: Challenges dominated this sector, as revenue plummeted to $41.0 million, representing an 18.2% decline sequentially due largely to dampened regional gas-focused activities. This segment recorded an operating loss of $(8.1 million), with an adjusted EBITDA of only $2.7 million.

Financial Flexibility and Future Outlook

Chris Baker, CEO of KLX, expressed a cautious outlook, noting that economic uncertainties are influencing their industry perspective for 2025. Consequently, the focus on cost controls enabled the business to manage margin expansion despite adversity. The total liquidity as of March 31, 2025, stood at approximately $58 million, which comprises $15 million in cash and an additional $43 million from available credit facilities.

A prudent approach towards capital management is evident, as KLX will continue evaluating share repurchases post-refinancing efforts completed in March 2025, enhancing the company’s financial leeway.

Conclusion

As KLX Energy Services navigates through volatile market conditions, its strategic efforts in maintaining financial health and operational excellence position it favorably for future endeavors. The company is optimistic about growth in the coming quarters and will continue to pursue opportunities to strengthen its market standing while adapting to dynamic energy landscapes.

To learn more about KLX Energy Services and its operations, please visit www.klx.com.