Mammoth Energy Services, Inc. (TUSK) Annual Report (Form 10-K) for the Fiscal Year Ended December 31, 2024
Mammoth Energy Services, Inc. filed its annual report for the fiscal year ended December 31, 2024, reporting a market value of common equity held by non-affiliates of approximately $78.9 million as of June 30, 2024. The company’s common stock is listed on the Nasdaq Global Select Market under the ticker symbol TUSK. As of March 5, 2025, there were 48,127,369 shares of common stock outstanding. The report does not provide detailed financial information, but it does indicate that the company is a non-accelerated filer and a smaller reporting company, and that it has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months.
Financial Overview and Highlights
Mammoth Energy Services, Inc. reported a net loss of $207.3 million, or $4.31 per diluted share, for the year ended December 31, 2024. This compares to a net loss of $3.2 million, or $0.07 per diluted share, for the prior year. The significant increase in net loss was primarily due to a non-cash, pre-tax charge of approximately $170.7 million related to the settlement agreement with the Puerto Rico Electric Power Authority (PREPA).
Adjusted EBITDA, a non-GAAP financial measure, was ($167.5) million for 2024 compared to $71.0 million in 2023. The decrease was also largely attributable to the PREPA settlement charge. Net cash flow provided by operating activities was $180.7 million in 2024, up from $31.4 million in 2023, driven by increased collections on accounts receivable.
Segment Performance
Well Completion Services Revenue from the well completion services division decreased 73% to $34.0 million in 2024 from $127.4 million in 2023. This was due to a 66% decline in the number of stages completed as a result of lower activity by customers in the natural gas basins where Mammoth operates. Cost of revenue as a percentage of revenue increased to 114% in 2024 from 82% in 2023 due to the lower utilization.
Infrastructure Services Infrastructure services revenue decreased slightly to $110.4 million in 2024 from $110.5 million in 2023. The average crew count declined from 83 to 79 over this period. Cost of revenue as a percentage of revenue increased to 83% in 2024 from 82% in 2023, primarily due to higher contract labor costs.
Natural Sand Proppant Services Natural sand proppant services revenue decreased 51% to $19.1 million in 2024 from $39.1 million in 2023. This was driven by a 53% decline in tons of sand sold and a 22% decrease in average sales price, reflecting lower completions activity by customers. Cost of revenue as a percentage of revenue increased to 93% in 2024 from 66% in 2023 due to the drop in volume and pricing.
PREPA Settlement
In July 2024, Cobra Acquisitions LLC, a subsidiary of Mammoth, entered into a settlement agreement with PREPA to resolve all outstanding matters. Under the agreement, Cobra was allowed an administrative expense claim of $170.0 million, plus $18.4 million in previously withheld funds.
As a result of the settlement, Mammoth recorded a non-cash, pre-tax charge of $170.7 million in the second quarter of 2024, including $89.2 million to credit loss expense and $81.5 million to interest on delinquent accounts receivable. This reduced Mammoth’s accounts receivable balance from PREPA from $359.1 million to the $188.4 million expected to be collected under the settlement.
The first two installment payments under the settlement were received in October 2024, with $150 million paid on October 1 and $18.4 million paid on October 18, subject to Cobra providing an indemnity letter of credit to PREPA. The remaining $20 million is expected to be paid when PREPA’s plan of adjustment becomes effective.
Liquidity and Capital Resources
As of December 31, 2024, Mammoth had $61.0 million in unrestricted cash, $25.2 million in available borrowing capacity under its revolving credit facility, and $13.1 million in net working capital (excluding cash). This compares to $16.6 million in cash, $27.0 million in available revolver capacity, and $297.8 million in net working capital at the end of 2023.
The significant improvement in liquidity was primarily due to the receipt of $232.4 million from PREPA, including the initial settlement payments. This was partially offset by a $50.9 million paydown and termination of Mammoth’s term credit facility in October 2024.
Net cash provided by operating activities was $180.7 million in 2024, up from $31.4 million in 2023, reflecting the increased collections. Net cash used in investing activities was $10.4 million in 2024, primarily for maintenance capital expenditures. Financing activities used $112.1 million of cash, mainly for debt repayments.
As of March 5, 2025, Mammoth had $64.8 million in unrestricted cash, no outstanding borrowings under its $33.7 million revolving credit facility, and total liquidity of $91.0 million.
Outlook and Analysis
Mammoth’s financial performance in 2024 was heavily impacted by the non-recurring charge related to the PREPA settlement. Excluding this impact, the company continued to face challenges in its well completion and natural sand proppant segments due to lower activity levels by customers.
The well completion services division saw a significant decline in utilization and profitability as customers reduced completion activity, particularly in natural gas basins. The natural sand proppant business also struggled with lower volumes and pricing. In contrast, the infrastructure services segment remained relatively stable.
Looking ahead, Mammoth expects 2025 activity levels to be relatively steady, with the potential for some upside in natural gas-related work driven by increased LNG export capacity and power demand. The company will need to continue managing costs and capital expenditures to navigate the persistent weakness in its oilfield service lines.
Mammoth’s liquidity position has improved substantially following the PREPA settlement, providing more financial flexibility. The paydown and termination of the term credit facility also reduces the company’s debt burden and interest expense going forward. However, Mammoth’s ability to pursue growth opportunities or return capital to shareholders may still be limited by the lingering impacts of the PREPA situation and the overall industry environment.
Overall, Mammoth faces an uncertain outlook in its core oilfield service businesses, but the PREPA settlement and stronger liquidity position the company to weather the current market challenges. Successful execution in the infrastructure segment and any recovery in completion activity could provide upside, but Mammoth will need to maintain a disciplined approach to capital allocation and cost management in the meantime.
