CES ENERGY SOLUTIONS CORP. ANNOUNCES STRONG Q2 2025 RESULTS WITH RECORD SECOND QUARTER REVENUE AND DECLARES CASH DIVIDEND

Executive Summary

• CES Energy Solutions Corp. reported strong Q2 2025 financial results, achieving record second-quarter revenue of $574.0 million (up 4% year-over-year) and Adjusted EBITDAC of $88.3 million.
• The company announced a quarterly cash dividend of $0.0425 per share, payable on October 15, 2025, to shareholders of record as of September 30, 2025.
• CES returned a total of $40.9 million to shareholders during the quarter, comprising $9.5 million in dividends and $31.3 million in share repurchases under its NCIB.

Key Details

• Revenue Performance:
  • Q2 2025 Revenue: $574.0 million (Record for Q2), up 4% YoY from $553.2 million in Q2 2024.
  • Six Months Ended June 30, 2025 Revenue: $1.2 billion, up 6% YoY.
  • US Revenue (Q2): $405.6 million (Record), up 4% YoY. US Drilling Fluids Market Share reached 25% in Q2 and 24% for the six-month period.
  • Canada Revenue (Q2): $168.4 million (Record for Q2), up 4% YoY despite seasonal rig count declines. Canadian Drilling Fluids Market Share reached 36% in Q2 and 40% for the six-month period.
• Profitability Metrics:
  • Adjusted EBITDAC (Q2): $88.3 million (15.4% margin), down 8% YoY.
  • Adjusted EBITDAC (Six Months): $188.2 million, down 5% YoY.
  • Net Income (Q2): $51.8 million, up 8% YoY.
  • Net Income (Six Months): $95.9 million, down 7% YoY.
• Cash Flow & Capital Allocation:
  • Funds Flow from Operations (Q2): $76.7 million.
  • Free Cash Flow (Q2): $35.3 million.
  • Shareholder Returns (Q2): $40.9 million total ($9.5M dividends + $31.3M share repurchases of 4.8 million shares).
  • Shareholder Returns (Six Months): $68.9 million total ($16.3M dividends + $52.6M share repurchases).
• Balance Sheet & Debt:
  • Total Debt (June 30, 2025): $490.9 million.
  • Leverage: 1.25x Total Debt/Adjusted EBITDAC.
  • Working Capital Surplus: $671.6 million.
  • Senior Facility: Amended and restated on April 28, 2025, increasing total size to C$550.0 million (up from C$450.0 million) with a maturity of November 24, 2028.
• Acquisitions:
  • Closed acquisition of Fossil Fluids LLC on June 1, 2025.
  • Aggregate purchase price: $14.2 million ($7.0 million upfront cash + $7.2 million deferred earn-out based on EBITDA thresholds over three years).
• Outlook:
  • 2025 Capital Expenditures expected to be approximately $80.0 million, evenly split between maintenance and expansion.

Notable Quotes

• "CES' second quarter results continue to demonstrate the significant merits of its unique business model. CES has continued to provide mission critical chemical solutions enabling our customers to succeed in an era of high service intensity levels, and increasingly complex drilling fluids and production chemical technology requirements."
• "CES remains confident in its ability to continue generating strong surplus free cash flow, supported by its financial performance, outlook, and capital structure..."