Calfrac Reports Third Quarter 2025 Results

Executive Summary

• Calfrac Well Services Ltd. reported financial and operating results for the three and nine months ended September 30, 2025, alongside the announcement of a $35.0 million rights offering to fund debt repayment.
• The company generated Adjusted EBITDA of $48.5 million and net income of $4.3 million in Q3 2025, driven by improved North American margins and cost reductions, despite lower activity in Argentina.
• The rights offering includes a standby purchase agreement with major shareholders (holding >60% of shares) to guarantee the full $35.0 million raise, with proceeds and credit facility drawdowns earmarked to repay the 10.875% second lien secured notes.

Key Details

• Q3 2025 Financial Performance (Continuing Operations):
  • Revenue: $323.4 million (down 25% YoY).
  • Adjusted EBITDA: $48.5 million (down 25% YoY).
  • Net Income: $4.3 million ($0.05 per share diluted), compared to a net loss of $6.7 million in Q3 2024.
  • Cash Flow from Operations: $30.1 million (up 82% YoY).
  • Capital Expenditures: $32.8 million (up 46% YoY), including $19.9 million for Argentina equipment additions.
• Nine Months 2025 Performance (Continuing Operations):
  • Revenue: $1,095.8 million (down 8% YoY).
  • Adjusted EBITDA: $180.8 million (up 16% YoY).
  • Net Income: $27.4 million ($0.32 per share diluted), up 83% YoY.
• Rights Offering Details:
  • Aggregate Gross Proceeds: $35.0 million.
  • Subscription Price: $2.69 per common share (15% discount to 5-day VWAP).
  • Ratio: One transferable right per share; 0.1514872 of a share per right (approx. 6.6 rights per share).
  • Standby Purchase Agreement: Major shareholders (George Armoyan, Ronald P. Mathison, Charles Pellerin, EdgePoint Investment Group Inc., and Brian Luborsky) agreed to purchase unsubscribed shares to ensure the $35.0 million target is met.
  • Expected Completion: On or about December 23, 2025.
• Debt Repayment and Credit Facilities:
  • Proceeds from the Rights Offering and Credit Facility Drawdowns will be used to repay Calfrac Holdings LP’s outstanding 10.875% second lien secured notes.
  • Credit Facility Drawdowns: Company expects to draw on a new $120.0 million term loan and up to $15.0 million from existing syndicated/operating facilities.
  • Post-Transaction Debt Profile: Long-term debt expected to be between $200.0 million and $215.0 million at year-end, a reduction of over $100.0 million YoY.
  • Revolving credit facilities reduced to $100.0 million as of October 31, 2025.
• Operational Metrics (North America):
  • Q3 Revenue: $237.6 million (down 18% YoY).
  • Q3 Adjusted EBITDA: $34.0 million (up 8% YoY).
  • Active Pumping Horsepower: 879,000 (down 13% from 1,009,000 in Q3 2024).
  • Fracturing Jobs: 7,164 (down 9% YoY).
  • Fracturing Revenue per Job: $32,031 (down 10% YoY).
• Operational Metrics (Argentina):
  • Q3 Revenue: $85.8 million (down 39% YoY) due to customer budget exhaustion in Vaca Muerta.
  • Q3 Adjusted EBITDA: $19.2 million (down 49% YoY).
  • Nine Months Revenue: $370.3 million (up 18% YoY) driven by the second unconventional fracturing fleet.
  • Nine Months Adjusted EBITDA: $121.0 million (up 77% YoY).
  • Active Pumping Horsepower: 168,000 (up 21% from 139,000 in Q3 2024).
  • Significant funds repatriated from Argentina in Q3, contributing to debt reduction.
• Outlook and Strategy:
  • North America: Activity expected to decline in Q4 2025 due to budget exhaustion; moderate increase in oil-directed activity expected in 2026. Natural gas activity expected to be stable.
  • Argentina: Activity expected to decline in Q4 2025, but 2026 outlook remains positive. Second unconventional dual-fuel fracturing fleet will be added for full-year 2026 operations.
  • 2025 Capital Budget: Reduced from $165.0 million to $145.0 million due to reduced North American operating footprint.
  • 2026 Capital Spending: Expected to be significantly lower than 2025.

Notable Quotes

• Mike Olinek, CFO: “I am very pleased with the strong financial performance demonstrated by Calfrac’s teams in North America and Argentina during the third quarter despite slowing global oilfield spending... The Company made significant progress during the third quarter towards its debt reduction goals for 2025. Due to continued strong cash flow generation, the Company has subsequently reduced its borrowings under its revolving credit facilities to $100.0 million as at October 31, 2025.”
• Mike Olinek, CFO: “As Calfrac looks towards 2026, expansion capital needs are expected to be significantly lower than 2025, which will allow for continued progression on the Company’s debt reduction strategic priority. I am happy to welcome Tyler Dahlseide to the Company’s executive team as Vice President, Optimization & Strategy...”