The market expects Atlas Energy Solutions Inc. (AESI) to deliver a year-over-year decline in earnings on higher revenues when it reports results for the quarter ended March 2025. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected ...

Acquisition and Integration Risks - The company is currently facing uncertainties regarding the anticipated benefits and projected synergies from the Moser Acquisition, which may not be realized within the expected timeframe or at all [14]. - The company is subject to risks related to the integration of Moser's business, which may not yield the expected benefits [26]. - The company’s ability to maintain financial flexibility may be limited due to existing and future debt following the Moser Acquisition [14]. Customer Base and Quality - The company had 49 customers in 2024, with 10 classified as investment grade, compared to 33 customers and 6 investment grade in 2023, indicating a significant increase in customer base quality [486]. Commodity Price Exposure - The company does not currently intend to hedge its indirect exposure to commodity price risk, which is influenced by fluctuations in crude oil and natural gas prices [481]. - The company is exposed to volatility in natural gas prices, which are critical for its proppant manufacturing operations, and has not entered into any commodity derivative contracts for 2023 and 2024 [482]. - The company’s operational performance may be adversely affected by a material decline in oil and natural gas prices or activity levels in the Permian Basin [485]. Operational Challenges - The company is focused on improving its production facilities following a fire incident at the Kermit facility on April 14, 2024, which may impact future performance [14]. - The company is facing risks related to environmental regulations and operational disruptions that could affect its business operations [19]. Inflation Impact - Inflationary factors may adversely affect the company's results of operations due to increased product and overhead costs [487]. - The company does not believe inflation has materially impacted its financial position or results of operations to date [487]. - A high rate of inflation in the future may negatively affect the company's ability to maintain current gross margin levels [487]. - Selling prices of the company's products may need to increase to keep pace with rising costs [487]. - Selling, general, and administrative expenses as a percentage of net revenue may be impacted by inflation [487]. Debt and Financial Flexibility - As of December 31, 2024, the company had $70.0 million of debt outstanding under the 2023 ABL Credit Facility, with a potential annual interest expense fluctuation of approximately $0.4 million for a hypothetical 1.0% change in interest rates [483].

Financial Data and Key Metrics Changes - Total company's adjusted EBITDA was $288.9 million or 27% of revenue [29] - Fourth quarter reported total sales of $271.3 million and adjusted EBITDA of $63.2 million or 23.3% of revenue [29] - Net income was $14.4 million or 5.3% of revenue, with earnings per share at $0.13 [35] - Adjusted free cash flow was $47.9 million or 17.7% of revenue [35] - CapEx during the quarter was $50 million, with maintenance CapEx at $15.3 million [36] Business Line Data and Key Metrics Changes - Revenue from proppant sales was $128.4 million, with total profit sales volumes per quarter declining to 5.1 million tons due to seasonal slowdown [30] - Average revenue per ton for the quarter was $25.31, adjusted to $23.28 per ton when accounting for contractual payments [31] - Logistics revenue for the year was $140.5 million [29] Market Data and Key Metrics Changes - Spot sand prices fell to cyclical lows during the fourth quarter due to reduced customer demand and aggressive pricing from competitors [18] - The company expects a gradual return to normalcy in sand pricing, with expectations for a return to mid-teen levels [21][36] Company Strategy and Development Direction - The company aims to ramp up volumes and achieve full effective utilization of the Dune Express by midyear [8] - The acquisition of Mosier Energy Systems is seen as a platform investment into the distributed power market, with plans to grow its fleet from 212 megawatts to approximately 310 megawatts by the end of 2026 [15][16] - The company is focused on shareholder returns, having increased its quarterly dividend by 4% [13][36] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about a gradual recovery in the Permian profit market and rational pricing behavior among competitors [20][21] - The company expects Q1 volumes to be up 10% to 15% sequentially and anticipates adjusted EBITDA for Q1 to be between $75 million and $85 million [41] - Full-year 2025 adjusted EBITDA is expected to reflect the contribution from the Mosier acquisition [42] Other Important Information - The company has paid out $252 million in total dividends and distributions since inception [53] - The Dune Express is described as the world's first commercial driverless delivery operation, enhancing logistics efficiency [10][49] Q&A Session Summary Question: Can you speak to the volume moved down the Dune Express and gating factors for full utilization? - The company is currently running at 50% to 60% of capacity and expects to reach full utilization by midyear, with some planned downtime for optimization [60][62] Question: How are you balancing growth opportunities with returning cash to shareholders? - The company aims to maintain a stable dividend while pursuing high-return growth projects, with a focus on optimizing cash flow [66][68] Question: Can you discuss plans for the Mosier acquisition and future power generation? - The Mosier acquisition is viewed as a platform for growth in the power business, with potential for rapid expansion based on customer demand [75][76] Question: What are the cost savings of using autonomous trucks versus regular trucks? - The company noted that labor constitutes about 70-80% of truck operating costs, indicating significant potential savings with autonomous trucks [82] Question: What is the current contract coverage for the year? - The company has approximately 22 million tons contracted for 2025, with expectations for this number to increase [117] Question: Are you seeing interest from customers for longer-term contracts? - There is a trend towards longer-term contracts, which may have lower pricing but provide volume stability [120]

Core Viewpoint - Atlas Energy Solutions Inc. reported quarterly earnings of $0.06 per share, missing the Zacks Consensus Estimate of $0.17 per share, and down from $0.37 per share a year ago, indicating a significant earnings surprise of -64.71% [1] Financial Performance - The company posted revenues of $271.34 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.11%, and showing a substantial increase from year-ago revenues of $141.14 million [2] - Over the last four quarters, Atlas Energy Solutions has not surpassed consensus EPS estimates, with the most recent quarter also reflecting a decline in earnings expectations [2][6] Stock Performance - Atlas Energy Solutions shares have lost about 7% since the beginning of the year, contrasting with the S&P 500's gain of 2.2%, indicating underperformance in the market [3] - The current Zacks Rank for the stock is 5 (Strong Sell), suggesting that shares are expected to underperform the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the coming quarter is $0.26 on revenues of $298.98 million, and for the current fiscal year, it is $1.50 on revenues of $1.27 billion [7] - The trend of estimate revisions for Atlas Energy Solutions has been unfavorable ahead of the earnings release, which may impact future stock performance [6] Industry Context - The Oil and Gas - Integrated - United States industry is currently in the top 20% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8]

Acquisition Details - Atlas Energy Solutions Inc. announced a definitive agreement to acquire Moser Energy Systems for a total transaction value of $220 million, consisting of $180 million in cash and approximately 1.7 million shares valued at $40 million[1][2]. - The acquisition is anticipated to be immediately accretive and is expected to close by the end of Q1 2025, pending customary closing conditions[4][7]. - Moser Energy Systems has a strong EBITDA margin profile of over 50%, which is expected to enhance Atlas's cash flow generation and shareholder returns[4]. - The company is in the process of completing the Moser Acquisition, which is subject to various risks and uncertainties[27]. - The company anticipates potential synergies from the Moser Acquisition, but the realization of these benefits is uncertain[27]. Financial Projections - For Q4 2024, estimated revenue is projected to be between $270.0 million and $272.0 million, representing an increase of approximately 92% compared to Q4 2023 revenue of $141.1 million[11]. - Estimated Adjusted EBITDA for Q4 2024 is expected to be between $62.2 million and $64.2 million, a decrease of approximately 8% from Q4 2023 Adjusted EBITDA of $68.7 million[12]. - For the fiscal year 2024, revenue is expected to be between $1,055.0 million and $1,057.0 million, an increase of approximately 72% compared to $614.0 million in fiscal year 2023[19]. - Estimated Adjusted EBITDA for the fiscal year 2024 is projected to be between $287.9 million and $289.9 million, a decrease of approximately 12% from $329.7 million in fiscal year 2023[19]. - Full Year 2023 Net Income was $226,493,000, with an estimated range for Full Year 2024 between $58,392,000 and $59,792,000[30]. - Full Year 2023 Adjusted EBITDA was $329,655,000, with an estimated range for Full Year 2024 between $287,866,000 and $289,866,000[30]. Cash Flow and Income - Cash and cash equivalents are expected to total approximately $71.7 million, a decrease of approximately 66% from $210.2 million at the end of fiscal year 2023[19]. - Net Income for Q4 2023 was $36,050,000, with an estimated range for Q4 2024 between $12,850,000 and $14,250,000[30]. - EBITDA for Q4 2023 was $64,057,000, with an estimated range for Q4 2024 between $64,928,000 and $67,328,000[30]. - EBITDA for Full Year 2023 was $316,957,000, with an estimated range for Full Year 2024 between $232,145,000 and $234,545,000[30]. Operational Strategies - Atlas continues to invest in technologies such as autonomous trucking and artificial intelligence to improve operational efficiencies and reduce costs[20]. Risks and Uncertainties - The company is facing risks related to commodity price volatility, particularly due to geopolitical tensions in regions like Ukraine and the Middle East[27]. - The company has outlined a stock repurchase program, but the successful execution of this program is uncertain[27].

Acquisition Details - Langford Energy Partners (LEP) acquired Midland Basin assets from Murchison Oil and Gas, LLC, closing the deal on December 6, 2024 [1][2] - The acquired assets include approximately 8,000 net acres primarily located in Howard, Borden, and Midland Counties, Texas [1] - The assets have a net production of approximately 7,200 boe/d, with 72% being oil, primarily from 63 operated horizontal wells [1] - The acquisition includes established oil, gas, and water infrastructure, such as two owned saltwater disposal wells, to support future production and development [1] Management Perspective - LEP's CEO, Lance Langford, views the acquisition as an opportunity to expand the company's operational success and deliver value to investors, leveraging the asset for further bolt-on acquisitions in the Midland Basin [3] - Executive Chairman Bud Brigham highlights the high-quality nature of the asset, which aligns with the company's strategy, and expresses personal excitement about re-entering the Midland Basin, where he began his career [3] Financing and Advisors - The acquisition was funded through equity from LEP's flagship fund, Langford Energy Partners I, LP, and senior bank debt from a new credit facility led by Texas Capital Bank [5] - Legal counsel for LEP was provided by Vartabedian Hester & Haynes LLP, Vinson & Elkins LLP, and Kirkland & Ellis LLP [6] - RBC Richardson Barr served as the exclusive financial advisor, and Holland & Knight LLP acted as legal counsel for Murchison [6] Company Background - Langford Energy Partners manages a direct-to-LP fund focused on operated oil & gas investments, led by General Partners Lance Langford and Bud Brigham, who have over three decades of industry experience [7] - The Brigham Platform, led by Bud Brigham, consists of four enterprises, including LEP, aiming to capitalize on traditional energy sources while prioritizing innovation and operational efficiency [9]

Core Insights - Brigham Exploration (BEXP) has acquired nonoperated assets from Great Western Drilling Ltd. (GWDC) in Texas and New Mexico, significantly expanding its footprint in the Permian Basin [1][2]. Acquisition Highlights - The acquisition includes over 7,000 net acres in the Delaware and Midland Basin, primarily located in Eddy and Lea Counties, New Mexico, and Martin, Midland, Loving, and Winkler Counties, Texas [2]. - As of August 2024, the net production from the acquired assets is approximately 2,700 barrels of oil equivalent per day (boe/d) from around 29 net producing wells [2]. - The pro forma balance sheet post-acquisition is expected to maintain a strong leverage ratio below 1.0x [2]. - The acquisition was finalized on November 22, 2024, with an effective date of April 1, 2024 [2]. - Following the acquisition, BEXP's estimated average net daily wellhead production is projected to be around 15,500 boe/d from a combined total of approximately 79 net producing wells [2]. Strategic Alignment - The acquisition aligns with BEXP's strategic focus on high-quality properties with low geologic risk in the Permian Basin [2]. - Bud Brigham, BEXP's Executive Chairman, emphasized that this acquisition enhances their existing asset base and diversifies their positions geographically and geologically [3]. - The acquisition was funded through existing equity commitments, a new credit facility led by BOK Financial, and available cash [3]. Advisory Support - Vinson & Elkins LLP acted as legal counsel for BEXP, while Redfield Energy Advisors served as financial advisor and Lynch, Chappell & Alsup provided legal counsel to GWDC [4]. Company Background - BEXP is a premier non-operated oil and gas acquisition and management company focused on the Permian Basin, founded in 2017 by Bud Brigham, who has extensive experience in the oil and gas sector [5]. - The Brigham Platform, led by Bud Brigham, consists of multiple energy enterprises, emphasizing innovation, capital discipline, and operational efficiency [7].

Production Capacity and Operations - The company reported a combined annual production capacity of approximately 29 million tons as of September 30, 2024[98]. - The company operates four proppant production facilities near Kermit, Texas, and a fifth facility near Monahans, Texas[98]. - The company’s proppant is essential for the recovery of hydrocarbons from oil and natural gas wells[98]. - The Dune Express, an overland conveyor infrastructure solution, is currently under construction to enhance logistics efficiency[98]. - The company’s operations are significantly influenced by the demand for proppant in the Permian Basin[97]. Financial Performance - Adjusted EBITDA for the three months ended September 30, 2024, was $71,051 thousand, compared to $84,078 thousand for the same period in 2023, reflecting a decrease of approximately 15.5%[113]. - Adjusted Free Cash Flow for the three months ended September 30, 2024, was $58,669 thousand, down from $68,521 thousand in the prior year, representing a decline of about 12.7%[115]. - Net income for the three months ended September 30, 2024, was $3,918 thousand, significantly lower than $56,327 thousand for the same period in 2023, indicating a decrease of approximately 93%[114]. - Adjusted EBITDA Margin for the three months ended September 30, 2024, was 23.3%, down from 53.3% in the prior year, indicating a significant decline in profitability[116]. - Adjusted Free Cash Flow Margin for the three months ended September 30, 2024, was 19.3%, compared to 43.5% for the same period in 2023, reflecting a decrease of approximately 55.6%[116]. - Gross profit for September 2024 was $53,018, compared to $79,625 in September 2023, reflecting a decrease of approximately 33.4%[117]. - Contribution margin for the nine months ended September 2024 was $250,390, down from $278,993 in the same period of 2023, a decline of about 10.3%[117]. Sales and Revenue - Product sales increased by $30.5 million to $145.3 million for the three months ended September 30, 2024, compared to $114.8 million for the same period in 2023, driven by higher sales volume[123]. - Service sales rose by $116.3 million to $159.1 million for the three months ended September 30, 2024, compared to $42.8 million in the prior year, attributed to increased logistics revenue and a full quarter contribution from Hi-Crush[123]. - Total sales reached $304.4 million for the three months ended September 30, 2024, up from $157.6 million in the same period of 2023[123]. Costs and Expenses - Cost of sales (excluding depreciation, depletion, and accretion expense) increased by $157.5 million to $225.3 million for the three months ended September 30, 2024, compared to $67.8 million in 2023[124]. - Operating income decreased to $15.2 million for the three months ended September 30, 2024, down from $65.3 million in the same period of 2023[124]. - Selling, general and administrative expenses increased by $11.2 million to $25.5 million for the three months ended September 30, 2024, due to higher employee costs and acquisition-related expenses[124]. - Interest expense, net rose by $9.7 million to $11.2 million for the three months ended September 30, 2024, driven by financing for the Hi-Crush acquisition[124]. Debt and Financing - Total debt as of September 30, 2024, was $475,262, significantly higher than $172,511 in September 2023[119]. - The company reported a net debt of $414,100 as of September 30, 2024, compared to a net cash position of $(84,048) in September 2023[119]. - The company issued a Deferred Cash Consideration Note with an initial principal amount of $111.8 million, bearing interest at 5.00% per annum if paid in cash[103]. - The 2023 Term Loan Credit Facility includes a $180.0 million initial term loan with a maturity date of July 31, 2030, bearing interest at 9.50% per annum[131]. - Interest expense associated with the 2023 Term Loan was $12.8 million for the nine months ended September 30, 2024, compared to $2.9 million in the same period of 2023[132]. Acquisitions and Transactions - The acquisition of Hi-Crush Inc. was completed on March 5, 2024, for a total consideration of $456.1 million, subject to customary post-closing adjustments[100]. - The company completed the Hi-Crush Transaction on March 5, 2024, acquiring assets for a total consideration of $140.1 million in cash and $111.8 million in deferred cash[120]. Market Conditions and Risks - The company is subject to various risks, including fluctuations in oil and natural gas prices and competition from other companies[97]. - The price for West Texas Intermediate crude oil decreased by approximately 15% from $82.69 per barrel in Q2 2024 to $70.24 per barrel in Q3 2024[106]. - The Permian Basin drilling rig count declined by two active rigs quarter-over-quarter, ending at 306 active rigs[106]. - E&P companies are increasingly drilling longer lateral wells, which drives up proppant demand for each well completed in the Permian Basin[108]. - The company is subject to various market risks, including interest rate risks and commodity pricing risks, with no material changes in risk exposure since December 31, 2023[141]. Compliance and Regulations - The company emphasizes the importance of maintaining necessary permits and compliance with environmental regulations[97]. - The company is classified as an "emerging growth company" under the JOBS Act, allowing for extended transition periods for compliance with new accounting standards[138]. - The company assesses goodwill and acquired intangible assets for impairment annually, with adjustments made based on fair value assessments[140]. - The company has engaged third-party appraisal firms to assist in determining fair values for identifiable long-lived assets and intangible assets acquired[139].

Atlas Energy Solutions Inc. (NYSE:AESI) Q3 2024 Earnings Conference Call October 29, 2024 10:00 AM ET Company Participants Kyle Turlington - Vice President, Investor Relations Bud Brigham - Executive Chairman John Turner - Chief Executive Officer Blake McCarthy - Chief Financial Officer Chris Scholla - Chief Operating Officer Conference Call Participants Jim Rollyson - Raymond James Kurt Hallead - Benchmark Keith MacKey - RBC Capital Markets David Smith - Pickering Energy Partners Sean Mitchell - Daniel Ene ...

Investor Presentation October 2024 NYSE: AESI Important Disclosures Forward-Looking Statements This Presentation contains "forward-looking statements" of Atlas Energy Solutions Inc. ("Atlas," the "Company," "AESI," "we," "us" or "our") 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. Statements that are predictive or prospective in nature, that depend upon or refer to future events or conditions or that include t ...