tusk-20211105
0001679268FALSE00016792682021-11-052021-11-05



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 5, 2021
 
Mammoth Energy Services, Inc.

(Exact name of registrant as specified in its charter)

001-37917
(Commission File No.)
Delaware32-0498321
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
14201 Caliber Drive,Suite 300
Oklahoma City,Oklahoma(405)608-600773134
(Address of principal executive offices)(Registrant’s telephone number, including area code)(Zip Code)
______________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of The Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common StockTUSKThe Nasdaq Stock Market LLC
NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§232.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging Growth Company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(s) of the Exchange Act.  ¨






Item 2.02 Results of Operations and Financial Condition

On November 5, 2021, Mammoth Energy Services, Inc. (the “Company”) issued a press release announcing its financial and operational results for the third quarter ended September 30, 2021. A copy of that press release is furnished as Exhibit 99.1 to this report.

The information in this Item 2.02, including Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and will not be incorporated by reference into any registration statement filed under the Securities Act of 1933, as amended, unless specifically identified as being incorporated by reference in the registration statement.

Item 7.01 Regulation FD Disclosure

On November 5, 2021, the Company posted an investor presentation to the “investors” section of its website (www.mammothenergy.com), where the Company routinely posts announcements, updates, events, investor information and presentations and recent news releases. Information on the Company's website does not constitute part of this Current Report on Form 8-K.

The information in this Item 7.01 shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and will not be incorporated by reference into any registration statement filed under the Securities Act of 1933, as amended, unless specifically identified as being incorporated by reference in the registration statement.

Item 9.01 Financial Statements and Exhibits.

(d)    Exhibits.

104Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.





Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
MAMMOTH ENERGY SERVICES, INC.
Date:November 5, 2021By:/s/ Mark Layton
Mark Layton
Chief Financial Officer and Secretary





Document

Exhibit 99.1

https://cdn.kscope.io/a8857bf33affa9bcac3eb83d7f80f856-image.jpg


Mammoth Energy Services, Inc. Announces
Third Quarter 2021 Operational and Financial Results


OKLAHOMA CITY - November 5, 2021 - Mammoth Energy Services, Inc. (“Mammoth” or the “Company”) (NASDAQ: TUSK) today reported financial and operational results for the third quarter ended September 30, 2021.

Financial Overview for the Third Quarter 2021:

Total revenue was $57.5 million for the third quarter of 2021, as compared to $70.5 million for the same quarter last year and $47.4 million for the second quarter of 2021.

Net loss for the third quarter of 2021 was $40.9 million, or a $0.88 loss per share, as compared to net income of $3.4 million, or a $0.07 income per share, for the same quarter last year, and a net loss of $34.8 million, or a $0.75 loss per share, for the second quarter of 2021.

Adjusted EBITDA (as defined and reconciled below) was ($29.7) million for the third quarter of 2021, as compared to $22.1 million for the same quarter last year and ($5.5) million for the second quarter of 2021. During the third quarter of 2021, Mammoth recognized expense of $32.6 million related to its settlement with Gulfport Energy Corporation. Excluding this non-recurring expense, adjusted EBITDA was $2.9 million for the third quarter of 2021.

Arty Straehla, Chief Executive Officer of Mammoth commented, “We are pleased with the positive trajectory throughout our business segments during the third quarter compared to the second quarter, which led to higher revenue and an improved bottom line. We are also encouraged by the positive trends in our infrastructure business in the third quarter, including increased storm work relative to the second quarter, a new fiber maintenance and installation contract and increased bidding activity, as well as internal personnel changes that are gaining traction in this segment. Funding for projects in the infrastructure space remains strong with the added opportunity of a new federal infrastructure bill, which we are optimistic will be passed in the near future. While this is a sector impacted by near-term seasonality, we remain focused on improving results as we continue migrating the Company further into the infrastructure space to enhance long-term growth and sustainability.”

“In our oilfield businesses, improved commodities pricing continues to contribute to positive industry movement and increased equipment utilization as we ramped up a second hydraulic fracturing fleet during the quarter. In our sand business, we continue to see increased market activity.”

Straehla continued, “Lastly, as documented in several recent press releases, we are continuing to pursue numerous avenues in our efforts to collect our receivable from PREPA for work performed by our subsidiary Cobra Acquisitions LLC in Puerto Rico. We believe that published documentation to date continues to show that our team performed a difficult job in a difficult environment to save lives and aid the people of Puerto Rico in their time of need.”




Infrastructure Services
Mammoth’s infrastructure services division contributed revenue of $23.5 million, or approximately 41% of Mammoth’s total revenue, for the third quarter of 2021, as compared to $43.6 million for the same quarter last year and $17.2 million for the second quarter of 2021. The decrease in revenue compared to the same quarter of 2020 is primarily due to a decline in storm activity, resulting in lower storm restoration revenue, as well as management and crew turnover.

Well Completion Services
Mammoth’s well completion services division contributed revenue (inclusive of inter-segment revenue) of $22.7 million on 688 stages for the third quarter of 2021, as compared to $15.8 million on 449 stages for the same quarter last year and $17.4 million on 520 stages for the second quarter of 2021. On average, 1.2 of the Company’s fleets were active for the third quarter, compared to an average utilization of 0.9 fleets during the same quarter last year and during the second quarter of 2021.
Natural Sand Proppant Services
Mammoth’s natural sand proppant services division contributed revenue (inclusive of inter-segment revenue) of $8.4 million for the third quarter of 2021, as compared to $6.0 million for the same quarter last year and $6.9 million for the second quarter of 2021. In the third quarter of 2021, the Company sold approximately 315,000 tons of sand at an average sales price of $16.58 per ton, as compared to sales of approximately 68,000 tons of sand at an average sales price of $15.59 per ton during the same quarter last year. In the second quarter of 2021, sales were approximately 255,000 tons of sand at an average price of $15.80 per ton.

Drilling Services
Mammoth’s drilling services division contributed revenue (inclusive of inter-segment revenue) of $1.2 million for the third quarter of 2021, as compared to $1.2 million for the same quarter last year and $1.1 million for the second quarter of 2021.

As a result of market conditions, the Company temporarily shut down its contract land drilling operations beginning in December 2019 and its rig hauling operations beginning in April 2020.

Other Services
Mammoth’s other services, including aviation, coil tubing, pressure control, equipment rentals, crude oil hauling, full-service transportation, remote accommodations, equipment manufacturing and infrastructure engineering and design services, contributed revenue (inclusive of inter-segment revenue) of $6.2 million for the third quarter of 2021, as compared to $4.7 million for the same quarter last year and $5.5 million for the second quarter of 2021.

As a result of market conditions, the Company temporarily shut down its cementing and acidizing operations as well as its flowback operations beginning in July 2019, its coil tubing and full-service transportation operations beginning in July 2020 and its crude oil hauling operations beginning in July 2021.

Selling, General and Administrative Expenses
Selling, general and administrative (“SG&A”) expenses were $41.9 million for the third quarter of 2021, as compared to $12.2 million for the same quarter last year and $12.0 million for the second quarter of 2021.
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Following is a breakout of SG&A expense (in thousands):
Three Months EndedNine Months Ended
September 30,June 30,September 30,
20212020202120212020
Cash expenses:
Compensation and benefits$3,353 $3,449 $3,333 $11,379 $11,138 
Professional services4,571 5,651 5,806 13,783 15,335 
Other(a)
2,252 2,163 2,464 7,058 6,572 
Total cash SG&A expense10,176 11,263 11,603 32,220 33,045 
Non-cash expenses:
Bad debt provision(b)
31,449 626 76 41,650 2,306 
Stock based compensation241 291 304 827 1,326 
Total non-cash SG&A expense31,690 917 380 42,477 3,632 
Total SG&A expense$41,866 $12,180 $11,983 $74,697 $36,677 
a.    Includes travel-related costs, information technology expenses, rent, utilities and other general and administrative-related costs.
b.    The bad debt provision for the three and nine months ended September 30, 2021, includes $31.2 million and $41.2 million, respectively, for settlement of our accounts with Gulfport Energy Corporation and its subsidiaries.

SG&A expenses, as a percentage of total revenue, were 73% for the third quarter of 2021, as compared to 17% for the same quarter last year and 25% for the second quarter of 2021.

Liquidity
As of September 30, 2021, Mammoth had cash on hand of $8.0 million, outstanding borrowings under its revolving credit facility of $77.0 million and $43.2 million of available borrowing capacity under its revolving credit facility, after giving effect to $9.0 million of outstanding letters of credit. As of September 30, 2021, Mammoth had total liquidity of $51.2 million.
On November 3, 2021, Mammoth entered into a third amendment to its revolving credit facility, providing, among other things, for a limited waiver and suspension of the leverage ratio and fixed charges coverage ratio covenants for the quarters ending September 30, 2021 and December 31, 2021 and permanently reducing the maximum revolving advance amount under its revolving credit facility from $130 million to $120 million. As of November 3, 2021, Mammoth had cash on hand of $6.5 million, outstanding borrowings under its revolving credit facility of $76.1 million and $24.1 million of available borrowing capacity under its revolving credit facility, after giving effect to $9.0 million of outstanding letters of credit, the $10 million reduction in the borrowing base and the requirement to maintain a $10 million reserve out of the available borrowing capacity during the limited waiver period, which will end on May 15, 2022, but may terminate earlier upon the occurrence of certain events.

Capital Expenditures
The following table summarizes Mammoth’s capital expenditures by operating division for the periods indicated (in thousands):
Three Months EndedNine Months Ended
September 30,June 30,September 30,
20212020202120212020
Infrastructure services(a)
$181 $178 $104 $474 $221 
Well completion services(b)
2,392 698 388 3,192 3,752 
Natural sand proppant services(c)
16 194 429 1,069 
Drilling services(d)
132 42 199 
Other(e)
172 323 63 337 708 
Total capital expenditures$2,765 $1,525 $561 $4,474 $5,949 
a.     Capital expenditures primarily for tooling and other equipment for the periods presented.
b.     Capital expenditures primarily for upgrades to our pressure pumping fleet to reduce greenhouse gas emissions and water transfer equipment for the periods presented.
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c.    Capital expenditures primarily for maintenance for the periods presented.
d.    Capital expenditures primarily for maintenance for the periods presented.
e.    Capital expenditures primarily for equipment for the Company’s rental businesses for the periods presented.

Conference Call Information
Mammoth will host a conference call on Friday, November 5, 2021 at 8:00 a.m. Central time (9:00 a.m. Eastern time) to discuss its third quarter 2021 financial and operational results. The telephone number to access the conference call is 216-562-0385. The conference call will also be webcast live on https://ir.mammothenergy.com/events-presentations.

About Mammoth Energy Services, Inc.
Mammoth is an integrated, growth-oriented energy services company focused on the construction and repair of the electric grid for private utilities, public investor-owned utilities and co-operative utilities through its infrastructure services businesses. The Company also provides products and services to enable the exploration and development of North American onshore unconventional oil and natural gas reserves. Mammoth’s suite of services and products include: infrastructure services, well completion services, natural sand and proppant services, drilling services and other energy services. For more information, please visit www.mammothenergy.com.

Contacts:
Mark Layton, CFO
Mammoth Energy Services, Inc
investors@mammothenergy.com

Rick Black / Ken Dennard
Dennard Lascar Investor Relations
TUSK@dennardlascar.com

Forward-Looking Statements and Cautionary Statements
This news release (and any oral statements made regarding the subjects of this release, including on the conference call announced herein) contains certain statements and information that may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts that address activities, events or developments that Mammoth expects, believes or anticipates will or may occur in the future are forward-looking statements. The words “anticipate,” “believe,” “ensure,” “expect,” “if,” “intend,” “plan,” “estimate,” “project,” “forecasts,” “predict,” “outlook,” “aim,” “will,” “could,” “should,” “potential,” “would,” “may,” “probable,” “likely” and similar expressions, and the negative thereof, are intended to identify forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include statements, estimates and projections regarding the Company’s business outlook and plans, future financial position, liquidity and capital resources, operations, performance, acquisitions, returns, capital expenditure budgets, costs and other guidance regarding future developments. Forward-looking statements are not assurances of future performance. These forward-looking statements are based on management’s current expectations and beliefs, forecasts for the Company’s existing operations, experience and perception of historical trends, current conditions, anticipated future developments and their effect on Mammoth, and other factors believed to be appropriate. Although management believes that the expectations and assumptions reflected in these forward-looking statements are reasonable as and when made, no assurance can be given that these assumptions are accurate or that any of these expectations will be achieved (in full or at all). Moreover, the Company’s forward-looking statements are subject to significant risks and uncertainties, including those described in its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings it makes with the SEC, including those relating to the Company’s acquisitions and contracts, many of which are beyond the Company’s control, which may cause actual results to differ materially from historical experience and present expectations or projections which are implied or expressed by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: the severity and duration of the COVID-19 pandemic, related global and national health concerns and economic repercussions and the resulting negative impact on demand for our services; the volatility of oil and natural gas prices and actions by OPEC members and other exporting nations affecting commodities prices and production levels; operational challenges relating to the COVID-19 pandemic and efforts to mitigate the spread of the virus, including logistical challenges, protecting the health and well-being of our employees, remote work arrangements, performance of contracts and supply chain disruptions; the failure to receive or delays in receiving governmental authorizations, approvals and/or payments; the outcome of ongoing government investigations and other legal proceedings,
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including those relating to the contracts awarded to the Company’s subsidiary Cobra Acquisitions LLC by the Puerto Rico Electric Power Authority; the Company’s inability to replace the prior levels of work in its business segments, including its infrastructure and well completion services segments; risks relating to economic conditions; whether a federal infrastructure bill is implemented and the terms thereof; the loss of or interruption in operations of one or more of Mammoth’s significant suppliers or customers; the loss of management and/or crews; the outcome or settlement of our litigation matters, including the adverse impact of the recent settlements with Gulfport Energy Corporation and MasTec Renewables Puerto Rico, LLC, and the effect on our financial condition and results of operations ; the effects of government regulation, permitting and other legal requirements; operating risks; the adequacy of capital resources and liquidity; Mammoth's ability to regain compliance with certain financial covenants and comply with other terms and conditions under our recently amended revolving credit facility; weather; natural disasters; litigation; volatility in commodity markets; competition in the oil and natural gas and infrastructure industries; and costs and availability of resources.

Investors are cautioned not to place undue reliance on any forward-looking statement which speaks only as of the date on which such statement is made. We undertake no obligation to correct, revise or update any forward-looking statement after the date such statement is made, whether as a result of new information, future events or otherwise, except as required by applicable law.

5

MAMMOTH ENERGY SERVICES, INC.
CONSOLIDATED BALANCE SHEETS

ASSETSSeptember 30,December 31,
20212020
CURRENT ASSETS(in thousands)
Cash and cash equivalents$7,953 $14,822 
Short-term investment1,760 1,750 
Accounts receivable, net402,035 393,112 
Receivables from related parties, net238 28,461 
Inventories9,438 12,020 
Prepaid expenses3,859 13,825 
Other current assets754 758 
Total current assets426,037 464,748 
Property, plant and equipment, net194,478 251,262 
Sand reserves64,806 65,876 
Operating lease right-of-use assets14,766 20,179 
Intangible assets, net - customer relationships277 408 
Intangible assets, net - trade names3,194 4,366 
Goodwill12,608 12,608 
Deferred income tax asset8,094 — 
Other non-current assets4,247 5,115 
Total assets$728,507 $824,562 
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable$43,628 $40,316 
Payables to related parties
Accrued expenses and other current liabilities54,724 44,408 
Current operating lease liability6,996 8,618 
Current portion of long-term debt1,449 1,165 
Income taxes payable39,283 34,088 
Total current liabilities146,085 128,598 
Long-term debt, net of current portion79,195 81,338 
Deferred income tax liabilities687 24,741 
Long-term operating lease liability7,591 11,377 
Asset retirement obligation3,682 4,746 
Other liabilities15,003 10,435 
Total liabilities252,243 261,235 
COMMITMENTS AND CONTINGENCIES
EQUITY
Equity:
Common stock, $0.01 par value, 200,000,000 shares authorized, 46,684,065 and 45,769,283 issued and outstanding at September 30, 2021 and December 31, 2020467 458 
Additional paid in capital537,980 537,039 
Retained earnings(59,236)28,895 
Accumulated other comprehensive loss(2,947)(3,065)
Total equity476,264 563,327 
Total liabilities and equity$728,507 $824,562 


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MAMMOTH ENERGY SERVICES, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME


Three Months EndedNine Months Ended
September 30,June 30,September 30,
20212020202120212020
(in thousands, except per share amounts)
REVENUE
Services revenue$52,417 $55,279 $40,867 $135,975 $169,002 
Services revenue - related parties601 8,565 90 15,678 35,228 
Product revenue4,467 4,815 6,483 17,932 18,171 
Product revenue - related parties— 1,875 — 2,145 5,625 
Total revenue57,485 70,534 47,440 171,730 228,026 
COST AND EXPENSES
Services cost of revenue (exclusive of depreciation, depletion, amortization and accretion of $35,857, $20,424, $17,861, $53,448 and $65,728, respectively, for the three months ended September 30, 2021, September 30, 2020 and June 30, 2021 and nine months ended September 30, 2021 and 2020)43,538 41,445 43,103 128,703 154,397 
Services cost of revenue - related parties (exclusive of depreciation, depletion, amortization and accretion of $0, $0, $0, $0 and $0, respectively, for the three months ended September 30, 2021, September 30, 2020 and June 30, 2021 and nine months ended September 30, 2021 and 2020)181 131 107 397 329 
Product cost of revenue (exclusive of depreciation, depletion, amortization and accretion of $4,667, $2,689, $2,384, $7,051 and $7,344, respectively, for the three months ended September 30, 2021, September 30, 2020 and June 30, 2021 and nine months ended September 30, 2021 and 2020)9,865 4,353 7,165 22,939 21,862 
Selling, general and administrative41,866 11,979 11,791 74,312 36,063 
Selling, general and administrative - related parties— 201 192 385 614 
Depreciation, depletion, amortization and accretion19,148 23,132 20,265 60,559 73,130 
Impairment of goodwill— — — — 54,973 
Impairment of other long-lived assets547 — — 547 12,897 
Total cost and expenses115,145 81,241 82,623 287,842 354,265 
Operating loss(57,660)(10,707)(35,183)(116,112)(126,239)
OTHER INCOME (EXPENSE)
Interest expense, net(1,484)(1,098)(1,169)(3,878)(4,207)
Other income (expense), net11,056 7,943 (14,998)6,004 23,489 
Other income (expense), net - related parties— 1,099 — (515)2,232 
Total other income (expense)9,572 7,944 (16,167)1,611 21,514 
Loss before income taxes(48,088)(2,763)(51,350)(114,501)(104,725)
Benefit for income taxes(7,187)(6,193)(16,560)(26,370)(8,979)
Net (loss) income$(40,901)$3,430 $(34,790)$(88,131)$(95,746)
OTHER COMPREHENSIVE INCOME (LOSS)
Foreign currency translation adjustment, net of tax of ($69), ($95), $63, $36 and $116, respectively, for the three months ended September 30, 2021, September 30, 2020 and June 30, 2021 and nine months ended September 30, 2021 and 2020(289)324 239 118 (422)
Comprehensive (loss) income$(41,190)$3,754 $(34,551)$(88,013)$(96,168)
Net (loss) income per share (basic)$(0.88)$0.07 $(0.75)$(1.90)$(2.10)
Net (loss) income per share (diluted)$(0.88)$0.07 $(0.75)$(1.90)$(2.10)
Weighted average number of shares outstanding (basic)46,683 45,764 46,402 46,342 45,603 
Weighted average number of shares outstanding (diluted) 46,683 46,571 46,402 46,342 45,603 

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MAMMOTH ENERGY SERVICES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine Months Ended
September 30,
20212020
(in thousands)
Cash flows from operating activities:
Net loss$(88,131)$(95,746)
Adjustments to reconcile net loss to cash (used in) provided by operating activities:
Stock based compensation950 1,598 
Depreciation, depletion, accretion and amortization60,559 73,130 
Amortization of coil tubing strings— 359 
Amortization of debt origination costs469 703 
Bad debt expense41,650 2,306 
Gain on disposal of property and equipment(4,632)(927)
Impairment of goodwill— 54,973 
Impairment of other long-lived assets547 12,897 
Deferred income taxes(32,183)(7,334)
Other502 581 
Changes in assets and liabilities:
Accounts receivable, net(50,666)(11,707)
Receivables from related parties28,224 (31,152)
Inventories2,582 3,827 
Prepaid expenses and other assets9,947 8,803 
Accounts payable2,597 (5,211)
Payables to related parties(508)
Accrued expenses and other liabilities6,627 (3,166)
Income taxes payable5,192 (1,644)
Net cash (used in) provided by operating activities(15,764)1,782 
Cash flows from investing activities:
Purchases of property and equipment(4,474)(5,873)
Purchases of property and equipment from related parties— (76)
Proceeds from disposal of property and equipment9,581 4,859 
Net cash provided by (used in) investing activities5,107 (1,090)
Cash flows from financing activities:
Borrowings on long-term debt31,700 30,800 
Repayments of long-term debt(33,571)(21,000)
Proceeds from sale leaseback transaction9,473 — 
Payments on sale leaseback transaction(2,106)— 
Principal payments on financing leases and equipment financing notes(1,716)(1,423)
Debt issuance costs— (1,000)
Net cash provided by financing activities3,780 7,377 
Effect of foreign exchange rate on cash(57)
Net change in cash and cash equivalents(6,869)8,012 
Cash and cash equivalents at beginning of period14,822 5,872 
Cash and cash equivalents at end of period$7,953 $13,884 
Supplemental disclosure of cash flow information:
Cash paid for interest$3,236 $3,637 
Cash paid for income taxes, net of refunds received$978 $13 
Supplemental disclosure of non-cash transactions:
Purchases of property and equipment included in accounts payable$2,028 $2,032 

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MAMMOTH ENERGY SERVICES, INC.
SEGMENT INCOME STATEMENTS
(in thousands)
Three months ended September 30, 2021Infrastructure
Well Completion(a)
SandDrillingAll OtherEliminationsTotal
Revenue from external customers$23,489 $22,702 $4,439 $1,184 $5,671 $— $57,485 
Intersegment revenues— 30 3,980 23 482 (4,515)— 
Total revenue23,489 22,732 8,419 1,207 6,153 (4,515)57,485 
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion20,541 18,125 9,368 1,566 4,917 — 54,517 
Intersegment cost of revenues54 3,204 — — 324 (4,515)(933)
Total cost of revenue20,595 21,329 9,368 1,566 5,241 (4,515)53,584 
Selling, general and administrative4,586 34,606 1,068 288 1,318 — 41,866 
Depreciation, depletion, amortization and accretion4,933 6,538 2,533 1,942 3,202 — 19,148 
Impairment of other long-lived assets— — — — 547 — 547 
Operating loss(6,625)(39,741)(4,550)(2,589)(4,155)— (57,660)
Interest expense, net971 215 107 56 135 — 1,484 
Other (income) expense, net (9,256)755 (46)(66)(2,443)— (11,056)
Income (loss) before income taxes$1,660 $(40,711)$(4,611)$(2,579)$(1,847)$— $(48,088)
Three months ended September 30, 2020Infrastructure
Well Completion(a)
SandDrillingAll OtherEliminationsTotal
Revenue from external customers$43,582 $15,738 $6,031 $1,193 $3,990 $— $70,534 
Intersegment revenues— 27 — 11 687 (725)— 
Total revenue43,582 15,765 6,031 1,204 4,677 (725)70,534 
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion28,883 6,510 4,154 1,955 4,427 — 45,929 
Intersegment cost of revenues162 449 — — 114 (725)— 
Total cost of revenue29,045 6,959 4,154 1,955 4,541 (725)45,929 
Selling, general and administrative7,227 1,721 1,056 382 1,794 — 12,180 
Depreciation, depletion, amortization and accretion7,294 7,189 2,700 2,294 3,655 — 23,132 
Operating income (loss)16 (104)(1,879)(3,427)(5,313)— (10,707)
Interest expense, net623 253 70 60 92 — 1,098 
Other (income) expense, net(8,375)(1,156)1,792 20 (1,323)— (9,042)
Income (loss) before income taxes$7,768 $799 $(3,741)$(3,507)$(4,082)$— $(2,763)
Three months ended June 30, 2021Infrastructure
Well Completion(a)
SandDrillingAll OtherEliminationsTotal
Revenue from external customers$17,220 $17,337 $6,886 $1,130 $4,867 $— $47,440 
Intersegment revenues— 36 — 17 682 (735)— 
Total revenue17,220 17,373 6,886 1,147 5,549 (735)47,440 
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion19,881 16,396 7,400 1,568 5,130 — 50,375 
Intersegment cost of revenues50 666 — — 19 (735)— 
Total cost of revenue19,931 17,062 7,400 1,568 5,149 (735)50,375 
Selling, general and administrative7,383 1,893 991 395 1,321 — 11,983 
Depreciation, depletion, amortization and accretion5,899 6,447 2,387 2,079 3,453 — 20,265 
Operating loss(15,993)(8,029)(3,892)(2,895)(4,374)— (35,183)
Interest expense, net656 219 90 58 146 — 1,169 
Other expense (income), net15,904 (53)(127)(727)— 14,998 
Loss before income taxes$(32,553)$(8,249)$(3,929)$(2,826)$(3,793)$— $(51,350)

9

MAMMOTH ENERGY SERVICES, INC.
SEGMENT INCOME STATEMENTS
(in thousands)
Nine months ended September 30, 2021Infrastructure
Well Completion(a)
SandDrillingAll OtherEliminationsTotal
Revenue from external customers$69,965 $62,939 $20,031 $3,234 $15,561 $— $171,730 
Intersegment revenues— 120 3,980 54 1,804 (5,958)— 
Total revenue69,965 63,059 24,011 3,288 17,365 (5,958)171,730 
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion66,864 42,339 22,631 4,739 15,466 — 152,039 
Intersegment cost of revenues165 5,449 — — 344 (5,958)— 
Total cost of revenue67,029 47,788 22,631 4,739 15,810 (5,958)152,039 
Selling, general and administrative18,222 47,111 4,108 1,105 4,151 — 74,697 
Depreciation, depletion, amortization and accretion17,499 19,668 7,059 6,185 10,148 — 60,559 
Impairment of other long-lived assets— — — — 547 — 547 
Operating loss(32,785)(51,508)(9,787)(8,741)(13,291)— (116,112)
Interest expense, net2,287 688 291 177 435 — 3,878 
Other (income) expense, net (2,663)1,196 (892)(201)(2,929)— (5,489)
Loss before income taxes$(32,409)$(53,392)$(9,186)$(8,717)$(10,797)$— $(114,501)

Nine months ended September 30, 2020Infrastructure
Well Completion(a)
SandDrillingAll OtherEliminationsTotal
Revenue from external customers$99,307 $74,549 $22,421 $7,166 $24,583 $— $228,026 
Intersegment revenues— 1,080 95 16 2,046 (3,237)— 
Total revenue99,307 75,629 22,516 7,182 26,629 (3,237)228,026 
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion80,780 40,454 21,845 9,592 23,917 — 176,588 
Intersegment cost of revenues197 1,410 — 151 1,479 (3,237)— 
Total cost of revenue80,977 41,864 21,845 9,743 25,396 (3,237)176,588 
Selling, general and administrative19,001 5,347 3,737 2,776 5,816 — 36,677 
Depreciation, depletion, amortization and accretion22,416 23,346 7,380 7,814 12,174 — 73,130 
Impairment of goodwill— 53,406 — — 1,567 — 54,973 
Impairment of other long-lived assets— 4,203 — 326 8,368 — 12,897 
Operating loss(23,087)(52,537)(10,446)(13,477)(26,692)— (126,239)
Interest expense, net2,091 857 217 450 592 — 4,207 
Other (income) expense, net (24,082)(2,444)1,753 (251)(697)— (25,721)
Loss before income taxes$(1,096)$(50,950)$(12,416)$(13,676)$(26,587)$— $(104,725)
a.Mammoth changed the name of its pressure pumping segment to the well completion segment during the fourth quarter of 2020.
10

MAMMOTH ENERGY SERVICES, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

Adjusted EBITDA

Adjusted EBITDA is a supplemental non-GAAP financial measure that is used by management and external users of the Company’s financial statements, such as industry analysts, investors, lenders and rating agencies. Mammoth defines Adjusted EBITDA as net income (loss) before depreciation, depletion, amortization and accretion expense, impairment of goodwill, impairment of other long-lived assets, public offering costs, stock based compensation, interest expense, net, other (income) expense, net (which is comprised of the (gain) or loss on disposal of long-lived assets and interest on trade accounts receivable) and provision (benefit) for income taxes, further adjusted to add back interest on trade accounts receivable. The Company excludes the items listed above from net income (loss) in arriving at Adjusted EBITDA because these amounts can vary substantially from company to company within the energy service industry depending upon accounting methods and book values of assets, capital structures and the method by which the assets were acquired. Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, net income (loss) or cash flows from operating activities as determined in accordance with GAAP or as an indicator of Mammoth’s operating performance or liquidity. Certain items excluded from Adjusted EBITDA are significant components in understanding and assessing a company’s financial performance, such as a company’s cost of capital and tax structure, as well as the historic costs of depreciable assets. Mammoth’s computations of Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. The Company believes that Adjusted EBITDA is a widely followed measure of operating performance and may also be used by investors to measure its ability to meet debt service requirements.

The following tables provide a reconciliation of Adjusted EBITDA to the GAAP financial measure of net income (loss) on a consolidated basis and for each of the Company’s segments (in thousands):

Consolidated
Three Months EndedNine Months Ended
September 30,June 30,September 30,
Reconciliation of Adjusted EBITDA to net (loss) income:20212020202120212020
Net (loss) income$(40,901)$3,430 $(34,790)$(88,131)$(95,746)
Depreciation, depletion, amortization and accretion expense19,148 23,132 20,265 60,559 73,130 
Impairment of goodwill— — — — 54,973 
Impairment of other long-lived assets547 — — 547 12,897 
Public offering costs13 — 77 91 — 
Stock based compensation252 353 354 950 1,598 
Interest expense, net1,484 1,098 1,169 3,878 4,207 
Other (income) expense, net(11,056)(9,042)14,998 (5,489)(25,721)
Benefit for income taxes(7,187)(6,193)(16,560)(26,370)(8,979)
Interest on trade accounts receivable7,963 9,285 9,017 25,138 26,052 
Adjusted EBITDA$(29,737)$22,063 $(5,470)$(28,827)$42,411 

11

MAMMOTH ENERGY SERVICES, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

Infrastructure Services
Three Months EndedNine Months Ended
September 30,June 30,September 30,
Reconciliation of Adjusted EBITDA to net (loss) income:20212020202120212020
Net (loss) income$(2,288)$6,123 $(23,715)$(29,946)$(6,182)
Depreciation and amortization expense4,933 7,294 5,899 17,499 22,416 
Public offering costs(7)— 43 37 — 
Stock based compensation96 139 158 388 424 
Interest expense971 623 656 2,287 2,091 
Other (income) expense, net(9,256)(8,375)15,904 (2,663)(24,082)
Provision (benefit) for income taxes3,947 1,645 (8,838)(2,463)5,085 
Interest on trade accounts receivable9,290 8,170 9,017 26,980 23,796 
Adjusted EBITDA$7,686 $15,619 $(876)$12,119 $23,548 

Well Completion Services
Three Months EndedNine Months Ended
September 30,June 30,September 30,
Reconciliation of Adjusted EBITDA to net (loss) income:20212020202120212020
Net (loss) income$(40,711)$799 $(8,249)$(53,391)$(50,951)
Depreciation and amortization expense6,538 7,189 6,447 19,668 23,346 
Impairment of goodwill— — — — 53,406 
Impairment of other long-lived assets— — — — 4,203 
Public offering costs19 — 12 31 — 
Stock based compensation95 76 75 253 458 
Interest expense215 253 219 688 857 
Other expense (income), net755 (1,156)1,196 (2,444)
Interest on trade accounts receivable(1,327)1,073 — (1,841)2,206 
Adjusted EBITDA$(34,416)$8,234 $(1,495)$(33,396)$31,081 

Natural Sand Proppant Services
Three Months EndedNine Months Ended
September 30,June 30,September 30,
Reconciliation of Adjusted EBITDA to net loss:20212020202120212020
Net loss$(4,611)$(3,741)$(3,929)$(9,186)$(12,415)
Depreciation, depletion, amortization and accretion expense2,533 2,700 2,387 7,059 7,380 
Public offering costs— — 12 12 — 
Stock based compensation32 77 65 163 354 
Interest expense107 70 90 291 217 
Other income (expense), net(46)1,792 (53)(892)1,753 
Interest on trade accounts receivable— 26 — (1)26 
Adjusted EBITDA$(1,985)$924 $(1,428)$(2,554)$(2,685)

12

MAMMOTH ENERGY SERVICES, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

Drilling Services
Three Months EndedNine Months Ended
September 30,June 30,September 30,
Reconciliation of Adjusted EBITDA to net loss:20212020202120212020
Net loss$(2,579)$(3,508)$(2,826)$(8,717)$(13,676)
Depreciation expense1,942 2,294 2,079 6,185 7,814 
Impairment of other long-lived assets— — — — 326 
Acquisition related costs— — — — — 
Public offering costs— — — 
Stock based compensation38 28 71 166 
Interest expense56 60 58 177 449.501 
Other (income) expense, net(66)20 (127)(201)(251)
Adjusted EBITDA$(641)$(1,096)$(786)$(2,483)$(5,171)

Other Services(a)
Three Months EndedNine Months Ended
September 30,June 30,September 30,
Reconciliation of Adjusted EBITDA to net income (loss):20212020202120212020
Net income (loss)$9,288 $3,756 $3,929 $13,109 $(12,522)
Depreciation, amortization and accretion expense3,202 3,655 3,453 10,148 12,174 
Impairment of goodwill— — — — 1,567 
Impairment of other long-lived assets547 — — 547 8,368 
Public offering costs— — 
Stock based compensation23 23 28 75 196 
Interest expense, net135 92 146 435 592 
Other (income) expense, net(2,443)(1,323)(727)(2,929)(697)
Benefit for income taxes(11,134)(7,838)(7,722)(23,907)(14,064)
Interest on trade accounts receivable— 16 — — 25 
Adjusted EBITDA$(381)$(1,619)$(885)$(2,513)$(4,361)
a.    Includes results for Mammoth’s aviation, coil tubing, pressure control, equipment rentals, crude oil hauling, full-service transportation and remote accommodations, equipment manufacturing and infrastructure engineering and design services and corporate related activities. The Company’s corporate related activities do not generate revenue.

13

MAMMOTH ENERGY SERVICES, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

Adjusted Net (Loss) Income and Adjusted (Loss) Income per Share

Adjusted net (loss) income and adjusted basic and diluted (loss) income per share are supplemental non-GAAP financial measures that are used by management to evaluate the Company’s operating and financial performance. Management believes these measures provide meaningful information about the Company’s performance by excluding certain non-cash charges, such as impairment of goodwill and impairment of other long-lived assets, that may not be indicative of the Company’s ongoing operating results. Adjusted net loss and adjusted loss per share should not be considered in isolation or as a substitute for net loss and loss per share prepared in accordance with GAAP and may not be comparable to other similarly titled measures of other companies. The following tables provide a reconciliation of adjusted net loss and adjusted loss per share to the GAAP financial measures of net loss and loss per share for the periods specified.
Three Months EndedNine Months Ended
September 30,June 30,September 30,
20212020202120212020
(in thousands, except per share amounts)
Net (loss) income, as reported$(40,901)$3,430 $(34,790)$(88,131)$(95,746)
Impairment of goodwill— — — — 54,973 
Impairment of other long-lived assets547 — — 547 12,897 
Adjusted net (loss) income$(40,354)$3,430 $(34,790)$(87,584)$(27,876)
Basic (loss) income per share, as reported$(0.88)$0.07 $(0.75)$(1.90)$(2.10)
Impairment of goodwill— — — — 1.21 
Impairment of other long-lived assets0.01 — — 0.01 0.28 
Adjusted basic (loss) income per share$(0.87)$0.07 $(0.75)$(1.89)$(0.61)
Diluted (loss) income per share, as reported$(0.88)$0.07 $(0.75)$(1.90)$(2.10)
Impairment of goodwill— — — — 1.21 
Impairment of other long-lived assets0.01 — — 0.01 0.28 
Adjusted diluted (loss) income per share$(0.87)$0.07 $(0.75)$(1.89)$(0.61)

14