TPLM
Re: TPLM
Earnings fell short of analysts' estimates primarily because the profit margin for pressure pumping declined quite a bit. This is how they addressed it on the CC:
Jared Lewis - Northland Capital Markets, Research Division
I was worried just on RockPile, just looking at Q2 to Q3, you just kind of look at on a standalone margin basis. The percentage went down. Can you just give a little detail on maybe pricing environment or what you're seeing that might encounter for that?
Jonathan Samuels - Chief Executive Officer, President and Director
Yes, actually, the numbers don't really tell the truth, because we had a number of new business lines starting up. We brought on our second frac spread. We brought on wireline. There's a bunch of business segments that are expanding, and you have to stop up ahead of that. You need to train people. You need to get equipment tested and online. So what you see in Q3 is a lot of overhead costs that we can't allocate to any well, so they end up in our income statement they didn't generate revenue, and that's just pure build for the future. So I certainly understand where the question is coming from but the numbers actually hide what is a very positive trend in that business. Pricing is stable to often in some cases with some other customers. And overall, they're doing well.
IMO it was a great quarter! My focus is on production and proven reserve growth. In both areas they beat my forecast. The outlook is very strong for this one. I will have an updated forecast model posted under the Watch List tab soon. - Dan
Jared Lewis - Northland Capital Markets, Research Division
I was worried just on RockPile, just looking at Q2 to Q3, you just kind of look at on a standalone margin basis. The percentage went down. Can you just give a little detail on maybe pricing environment or what you're seeing that might encounter for that?
Jonathan Samuels - Chief Executive Officer, President and Director
Yes, actually, the numbers don't really tell the truth, because we had a number of new business lines starting up. We brought on our second frac spread. We brought on wireline. There's a bunch of business segments that are expanding, and you have to stop up ahead of that. You need to train people. You need to get equipment tested and online. So what you see in Q3 is a lot of overhead costs that we can't allocate to any well, so they end up in our income statement they didn't generate revenue, and that's just pure build for the future. So I certainly understand where the question is coming from but the numbers actually hide what is a very positive trend in that business. Pricing is stable to often in some cases with some other customers. And overall, they're doing well.
IMO it was a great quarter! My focus is on production and proven reserve growth. In both areas they beat my forecast. The outlook is very strong for this one. I will have an updated forecast model posted under the Watch List tab soon. - Dan
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group