CES Energy Solutions Corp (OTCPK:CESDF)

Q2 2026 CES Energy Solutions Corp Earnings Call Transcript

Aug 7, 2026 / 03:00 PM GMT

Release Date Price: $13.5 (+15.19%)

Transcript

Key Points

Positve

Record quarterly revenue of $714.1 million, up 24.4% year-over-year, and highest-ever quarterly EBITDA of $119.2 million, up 35%.
EBITDA margin of 16.7% exceeded the high end of the 15.5%-16.5% guidance range.
Achieved industry-leading market share: 29.7% in North American land rigs, 40.6% in Canada, and 25.5% in U.S. land rigs.
Strong growth in U.S. production chemicals (JChem Catalyst) with a 21% market share, and AES Completion Services revenue grew over five times since acquisition.
Successful refinancing reduced annual interest costs by ~$2 million and extended debt maturity to 2033, maintaining leverage at 1.15 times.
Improved cash conversion cycle to 95 days from 112 days year-over-year, and strong return on capital employed of 22%.
Continued share buybacks with 780,000 shares repurchased in Q2 and accelerated post-quarter purchases.
Positive outlook for 2027 with higher activity levels in Canada and U.S. due to infrastructure and LNG demand.

Negative

Cost pressures and supply chain challenges from the Iran conflict impacted the business, requiring significant effort to manage pricing.
Free cash flow conversion was only 21% in Q2 due to strategic working capital investments, down from 37% trailing 12 months.
Cash flow from operations decreased to $60 million from $69 million in Q1, driven by working capital needs.
Offshore Gulf of America production chemicals business is still in early stages, with margins below corporate average and long timelines for meaningful contribution.
Heavy oil trials are complex and may take months or years to convert into awards, with no immediate revenue impact.
International expansion opportunities in the Middle East have been delayed indefinitely due to the Iran conflict.
The company remains cautious about raising margin guidance despite recent outperformance, citing market volatility.
Total debt increased by $21 million in Q2, and net draw on credit facility rose to $172 million post-quarter.

Refinitiv StreetEvents Event Transcript
E D I T E D V E R S I O N

CEU.TO - CES Energy Solutions Corp
Q2 2026 CES Energy Solutions Corp Earnings Call
Aug 07, 2026 / 03:00PM GMT

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Presentation
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Unidentified_1 [1]
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Good morning, everyone, and thank you for attending today's call. I'd like to note that in our commentary today, there will be forward-looking financial information and that our actual results may differ materially from the expected results due to various risk factors and assumptions. These risk factors and assumptions are summarized in our second quarter ND&A and press release dated August 6, 2026. And in our annual information form dated March 10, 2026. In addition, certain financial measures that we will refer to today are not recognized under current generally accepted accounting principles, and for a description and definition of these, please see our second quarter MD&A and investor presentation posted on our

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