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KLX Energy Services Holdings, Inc. Financial Results for Q4 and Full-Year 2024

KLX Energy Services Holdings, Inc. (Nasdaq: KLXE) has released its financial results for the fourth quarter and the entire year of 2024, addressing key metrics that highlight the company's current financial health and future prospects.

Overview of 2024 Financial Highlights

In 2024, KLX reported total revenue of $709 million despite encountering a net loss of $(53) million, reflecting a net loss margin of (7%). Diluted loss per share stood at $(3.27). Notably, the adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) was recorded at $90 million, translating to an adjusted EBITDA margin of 13%.

The fourth quarter reported a revenue of $166 million and a net loss of $(15) million, equivalent to a net loss margin of (9%), with diluted loss per share at $(0.90). Adjusted EBITDA for this period was $23 million, with an adjusted EBITDA margin of 14%.

Strategic Refinancing Initiatives

Following the end of the year, KLX Energy Services completed the refinancing of its existing 2025 senior secured notes and established a new asset-based lending (ABL) credit facility, enhancing its financial flexibility moving forward.

CEO Insights

Chris Baker, the President and CEO of KLX, expressed satisfaction with the company’s performance by emphasizing their strength despite encountering seasonal challenges. “We finished the year strong; 2024 Q4 revenue was the midpoint of our guidance. Our cost control measures allowed us to improve our adjusted EBITDA margin, even with a decline in revenue and rig counts,” he stated.

The company is marking its focus on opportunities stemming from increasing gas-directed activity, influenced by the demand for LNG exports and trends in data centers and artificial intelligence. The expectation for U.S. LNG export capacity to double by 2030 suggests heightened domestic activity in the natural gas market, a positive indication for the oilfield services (OFS) pricing and utilization.

Segment Analysis

KLX operates three geographic business segments: Rocky Mountains, Southwest, and Northeast/Mid-Con. Below is a summary of the Q4 performance per segment:

• - Rocky Mountains: Revenue was $54 million, showing a 20.5% decline due to seasonal factors but contributing $11.8 million to adjusted EBITDA.
• - Southwest: This segment garnered $61.4 million in revenue with $9.6 million in adjusted EBITDA, resulting from a mixture of revenue adjustment and reduced overhead.
• - Northeast/Mid-Con: It experienced a revenue of $50.1 million and $9.8 million in adjusted EBITDA despite a decrease in activity due to budget constraints.

The Corporate and Other segment reported losses, demonstrating the ongoing effects of overhead concerns, with a loss of $11.1 million.

Future Outlook

Looking to 2025, KLX anticipates a steady revenue stream, potentially increasing slightly while projecting an adjusted EBITDA margin ranging between 13% and 15%. Baker concluded by highlighting the company's strategic positioning, operational excellence, and resilience, paving the way for sustainable value creation for its shareholders.

Conclusion

KLX Energy Services' financial outlook showcases a company that is navigating challenges while capitalizing on growth opportunities in a transforming energy landscape. Their strategic focus on cost efficiencies, alongside leveraging emerging market demands, positions them well for future success.

For latest updates and detailed financial data, KLX encourages stakeholders to participate in their upcoming conference call scheduled for March 13, 2025.