Release Date: August 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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STEP Energy Services Ltd (SNVVF) reported a significant increase in Q1 consolidated revenues to CAD 308 million, up from CAD 148 million in the prior quarter.
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The company achieved a net income of CAD 24 million or CAD 0.33 per diluted share in Q1, compared to a loss in the previous quarter.
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STEP Energy Services Ltd (SNVVF) introduced Canada’s first 100% natural gas reciprocating engine for fracturing operations, showcasing innovation in reducing diesel usage.
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The company maintained high utilization rates for its fracturing services, achieving near-record levels and breaking previous sand pumping records in Canada.
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STEP Energy Services Ltd (SNVVF) has strong long-term contracts with key clients in major basins, contributing to its operational success.
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The termination of the US fracturing division led to an internal leadership reorganization and asset transfers, indicating operational challenges.
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The company experienced a net loss from terminated operations of CAD 4 million in Q1.
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STEP Energy Services Ltd (SNVVF) faces geopolitical tensions and retaliatory tariffs, which are expected to increase operating costs.
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There is potential for a slowdown in oil-directed activity if oil prices fall below USD 60 per barrel, which could impact future revenues.
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The company reported an increase in net debt to CAD 85 million, up from CAD 53 million in the prior quarter, driven by working capital changes.
Q: How many tier 4 fleets does STEP Energy Services have in Canada now? A: Steve Glanville, President and CEO, stated that they are running about 2.5 fleets in Canada. With assets moving from the terminated US operations, they plan to bring in another fleet, potentially increasing to 3.5 fleets.
Q: What is the long-term plan for the NGX pump, and will there be more fleets with this technology? A: Steve Glanville explained that they are in the early stages of trialing the NGX pump and are pleased with its performance. The long-term plan involves replacing older equipment with this new technology, which is more cost-effective per horsepower. The decision to expand will depend on the success of ongoing trials.
Q: Have there been any indications of reduced activity from clients due to oil prices? A: Steve Glanville noted that there is more pressure in the US than in Canada. In Canada, 75-80% of clients are in natural gas liquid-rich fields, so there hasn’t been a reduction in CapEx yet. However, if oil prices remain low, some reduction might be expected.
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