Flotek Industries (FTK) 17 Mar 212020 Q4 Earnings call transcript

Greetings, and welcome to Flotek Industries Fourth Quarter 2020 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce Danielle Allen, Senior Vice President, Chief of Staff for Flotek. Thank you.

You may begin.

afternoon, good and you, everyone. Thank

Global and Joining remarks quarter On John Officer; today's XXXX. the Ezell, concerning of are year call, the we provide business on Chairman, me TengBeng of CEO prepared Technologies. President Financial our today for Gibson, Chief and call Borton, and and Ryan results first participating full President; Chemistry and Business; will Koid, President Michael the

for released and webcast, our Following which events statements. on have. a we that, website. website. we This quarter fourth our are also questions answer any is make note is that expectations our comments XXXX, being today's announcement may you projections be future openings available on regarding and will we any forward-looking on replay Today's will year the call for call Please morning, our or full available

and which earnings our on results factors press Forward-looking many our may expectations. I control. statements earnings number discussed in in the our as over with Also, release will refer our this to metrics call. from risk it listeners to With and reconciliation discuss risks turn We risks are and can to provided current filings non-GAAP subject advise of to please beyond management are differ the the of SEC. our earnings that, John. materially uncertainties review cause release uncertainties, a These to actual

to good Danielle, you, afternoon and Thank everyone.

experience facilities, employees which due Texas, fire we electricity for Before Louisiana, nearly was provide following impacted. repaired. month's The the including last and into it by week everyone of a headquarters vast subsequently sustain our unable damage to myself. storm. we quarter truly update was has miserable without our based operational suppression damage to days, many Oklahoma, were and to systems, a to severe And quick dive the in of the water several impacted wanted access that a been We our did for year, the for were strong, in weather I majority

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price of materials. there limited result, is certain and environment raw supplies a a rising As

really trusted We loss strong that and are state JPX outside deep the to not to Kevin's strategy, of just reelection as for Michelle result Board appointed fortunate replaced acquisition the Board to stand normal Kevin coming we passed Audit she strong to the the express mourn kind family to in like discussing of We valued unexpectedly is an and was Audit uninvested us Agadi result who and to deeply our would time Kevin in additionally, will we relationships service her Harsha the Board, chain will our update together. will supply source customers, announced Committee existing a are Kevin notified This responsibility. of Flotek to to commitments has Adams, Director, our of the missed. in important and his a report away was he his and Committee, have saddened we Director, a help January, friends, a our contributor you that supplier his is insights, weeks. who condolences provide to of supply I which joined and hopeful Brown, council our somber continue and here and in begin before June to XXXX, our our and Board results, moment give I on a board. I'm to following

business the Committee serving of JPX on the Board last technologies a and been She cloud-based a council development XXXX, since matters steadfast me Compensation as you, strategies advisor us is methodologies. Michelle Chair. Let and tell including superstar, gave acquisition. to Compensation has

group. incredibly fortunate achievements. to talented, but she's presence to to look believe we rocket ship, to and able the I continue be miss on have will few as forward continue watching Board the career next for truly her are her in months, with the sales We I work the her to is great

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you our keep will We progress. apprised of

business. Additionally, oversight we've Board we our Last Board and to committee, and Sustainability through new build enhance created the Committee. a a our to risk year identified process, Risk need resilient the assessment sustainable

human risks [indiscernible]. financial include we Audit the we of a the risk Committee, ESG, and future are broader While in the view have company's cybersecurity, as today much by typically capital, face to overseen the

sustainability We a are is be Mike. really with risk Director be work to exciting our Mike standing by that chaired the which to to time going and excited committee going is Fucci,

As of challenges macro pandemic are reasons. environment. extraordinary, The of look It was in people, volatile performance, back the year I extremely we in the remain am inspired on of industries an and a focused for the our by effect face XXXX opportunistic transformational and multiple business our we serve. resilience we but

innovative, for First, is team I future. built accountable we've the the an team am who is results-oriented proud and building leadership who of Flotek sustainably

the transformation of with and space Second, the stream digital revenue JPX, represents an long-term acquisition our excellent diversified growth entered which we further opportunity.

reduce lines. to include a efficiently expanded and our product we our and our run and made we sanitizing costs portfolio our disinfecting year, protect the in planning, to structural Fourth, liquidity. nimble improve to and quick our earlier processes chemistry more business Third, decision to

of we [indiscernible] the initiatives home of health, ever of operate. operations the Through our through communities these protect we our prioritized margin-accretive this personnel, where our to Following facilities And existing and utilizing governance we X our sustainability our supply chain, we safety business, actions, culture. environment, one efforts Through generate no goal increased security injured. on existing should in are and to existing focus our efforts our and revenue. all incidents, environmental, go

of a million revenue result a more half. to EBITDA our adjusted declining As these despite million loss initiatives, $XX of $X than by more year-over-year improved we've by than

by year capital budgets industry challenging for hydrocarbon between than their extraordinarily More uncertainty energy as new the oversupply to the recently, focus related full see demand a cancelation oil declined year-over-year, drilling stream perspective, Pipeline debt. a change Subsequently, hydrocarbons. on destruction with fees macro resulting across of initiatives. to more accelerate an customers added the crash, according new land on faced of water, domestic the price administration XX% [indiscernible] producers domestically the climate and of dramatically a by report Keystone to prioritize we XL COVID-XX along the from our a part Now federal the and

for the However, for optimistic we more of half outlook second seeing XXXX. reasons are

and opened. adoption COVID-XX As more businesses more stay-at-home vaccination restrictions increased eased broadly, rates

are was capital lows remain increasing we market margin on versus to highest producing acreage. and of of flat key strategies, for XXXX Segmentation E&Ps have Many producers operators, of through consistent activity the levels these XXXX, activity focused overall, projected XXXX. XXXX. sustained budgets tenders is are targeting around our one the Although QX programs in some from the with throughout

Additionally, of signs year. quarter, Energy forecast crude U.S. the pricing from the show Information the price per XXXX revising improvement continues to barrel to Administration with of average for last $XX an

steadily around overall, will continue communities XXXX, utilization While anticipate one rates the improve have open remains into weak to as been we trending up refinery world. and

in June to EIA. the gasoline of X-year adoption X% demand Additionally, to that had XXXX can our bit. we Middle chemicals mid-January, for the demand for a in Koid and optimism In the increased related according specialty, gasoline cover we prices, we our digital demand East, strength in In behind technology. oil seen over have recovery with the average. stimulation broad increase saw largest demand signs just see since opportunities of X-week will

a particular, a intend year the we validation. in XX% over business, East Middle Our energy to in very XXXX, chemistry had that strong on growth and build with

there a mindset sale of continuous professional products. permanent change to we and market, for the As businesses that the occurring will is chemistry demand create believe related gas consumers a in

to solutions do technologies that real-time help increasing help the today. reliability and commitments production to investment, emerging. to efficiencies, are efficiency their life trust begins to minimize against health alternatives by greener partner business chemicals together and risk. travel gas strengthens this waste and come positioned on deploying with of business in to back coronavirus while related also demand protocols vigilance we reestablish are of reduce ESG, by cycle consumers maintaining sanitizing our process remain safety, we and production with the As process. with we that finally, their will of well natural improve their reduce We to operations digital variants increased events, the increased high and new parts improve for transition, enable performance. chemistry And as Furthermore, cleaning offer seeking business the interactions, the businesses And to through social ESG in used to operational the environmental for energy believe energy supplies world toxic

our the year. forward we're we discussions throughout elevate ESG, about to see, can you As excited and more telling to you look

the if briefly Now at you results, for the fourth look quarter. quarterly just

sequential asset As impacted the was year-end of significant one the expected of the by opportunities, EBITDA we international slightly budget in earnings his the E&P down discussed And of coming revenue the businesses, and international had. generally TengBeng QX. activities. predictions that quarterly new on Koid data out, If direction. back improvement Thanksgiving on monetizing new and in was pleased we COVID-XX in performed chemistry the QX technologies with a in call as November, growth excited analytics resurgence and with expectations, impact consolidation the our achieved in Potentially the be in saw securing close we line our year executed about highlight those QX in is right last our strategy. earnings to we as remain international at milestone, general first played they comments. down to our the our capital we view adjusted softness from exhaustion, of markets, leaving the of with have pilots sales segment we is we our and model commercial evolved JPX I'm

to reduce of recent we Throughout balance the work and to quarter, leases move cost extensive sheet decisive strategic to take and and have liquidity remains pillars are Protecting evaluating continue to negotiate financial for renegotiate we gathered our on Flotek position cost. among options flexibility. we cost raw we bolster best our price priorities, our actions by the if suppliers our and to continued highest future. to the materials, pursuant with Now [indiscernible], we

to going will an will and for of it Technology who on pleased segment; it the provide us Koid to With analytics I'm Ryan update Ezell, results. Michael lastly, details in-depth discussion discussion turn quarter, additional over I am then on Chemistry over turn further data a more to TengBeng to that, Borton, of the financial our to Koid. give segment; TengBeng For who our

focused quarter, John. analytics data against remained In past business segment. our on we the Thank the in executing strategy you,

meaningfully to customers We demonstrate continue our the analysis. we and their real-time to businesses value through transform to bring data

a QX, maintenance North increase result support are market advancing our to which of we a pleased America was driven deliver by we and sales international services. assets, In and As XX.X% sequentially, revenue in made our also plan. progress on entry in new

East last Middle As business our an executive quarter, we who hired we efforts. the is based leading discussed in recently development international

We to secured announce that meaningful and Middle we positive and pilot. Africa are in we international engagement by Asia. we responses receiving have first the pleased East, encouraged Notably, our the are are

which to We are planning deployments. requirements and and in the East, are systems gas products expectations for oil reading we international we our the deployment. a Simultaneously, company have leading for begun and meet Middle

against milestones. making are key significant We progress

to market this While our in international lead fields longer is component growth an strategy. penetration require important times,

We an to with long and over of our term. achievement mid are opportunities the pleased about important milestone optimistic the

During machine capabilities. artificial development and software enhancements accelerating intelligence our the made we learning quarter, by

shipped planning of this being who costly. batches use save our hence, to applications due reduction algorithms is or learning pipeline. transmix. Reprocessing the first Customers reduce a transmix. millions of the the it common to that in we're natural the our adjacent between the on transmix machine technology of to time better Transmix, the in batches is implement downgrading the mixing products different potentially fuels could way, to and QX takes by launch is One cut improve further in

Additionally, opportunity commissioning reduce to efficiencies, to our strengthening improve fourth of we identified an operational process to quarter, streamline in the customers and our our our systems. cost accelerate

more hydrocarbon Over the than has with past years, robust our activity samples, of XX,XXX to which are real-time JPX essential built hydrocarbon analysis. library the a

do to our of samples, collect new not expensiveness we samples. many need the Given

samples. library. speed significant process streamlined greater to sampling are profitability i.e., As a rather up to that Hence, have our making sampleless, as than no our we less is needed commissioning. we higher progress sampling or result, i.e., to result so samples we build The sample-less, are and

in customers U.S. number the During added in quarter, the of fourth a we new and Canada.

the system technology. the Our in generally systems will once proven would in additional try result technology the normally customers to is purchase the future, in new a out It [indiscernible].

our companies the one the U.S. One prospects I'm additional in customers X have as our then, new we the in about systems. is QX midstream of customers to of operations. new enhance all our since the here safety largest make delivering purchased solutions for we and future offerings, added our improve efficiency continue we is And increase the our excited of markets. JPX customers while in helps and and money their game-changing technology more seeking

needed you, our are going result to Ezell call Technology this Ryan. Ryan to grow the Over to along With the I'm in our We to right direction pass to discuss line segment. that, to business. Chemical discuss

our on our launched on Chemistry XXXX professional a renegotiated down which accelerated our Koid. EPA Chemistry and transformative In and we Chemistry supplier you, been registered followed newly effectively Energy cleaning, our and discussing highlights I'll our for Technologies costs, FDA sanitizing chemistries, highlights Thank year operational business disinfecting lines. segment's and processes. contracts includes as business product provide efficiencies by logistics Energy Technologies performance, first our has in drove

future. we result, the oil leaner the business of meet that have can a and today of gas As needs the market a built and

aligned that operators a a refining In the customized remediation for reintroduce operational becoming wells improved centric that During fourth visibility value of as elevate with both chemistry chemistry County, operational enhanced as a it proven objectives solutions in produced. results are and particularly a solution range strategic with provided efforts lower Flotek international targeting a performance versus to was reservoir customized treatment companies. we the of utilizing treatment an unconditional that delivering traditional online customers domestic include boost recent acid example, sale focuses our and markets, We're proprietary cost being a proposition to barrel Flotek's of just the service oilfield efficiencies E&P sustainable choice programs, production. increase prove value production operator, our at through the Andrews with XX% per can alone. asset cost-effective Flotek to application, proposition quarter, brought acid this sales using partner In and back we strategy began chemistry simulation cost well its on production Texas, in achieved independent our chemistry. to and well our customer base Domestically, activity complement to in in of market

sole Middle every proves the the it that XX% which strategy, field. increase technically, growth opportunities, the economically cases to implemented we growth to process, value of in our variable than Execution are are decline been we domestic from there. to more can in and the of but service of efficacy on to Additionally, not last that quarter upside business by with of opportunities And Middle the customized impact the capillary international are opportunity. return excited has broad And provide new growth range international our production coiled a repetitive the Chemistry partnership only this international of multi-stage to our sales, Energy equation more while be traditional major evolve Choice market East. that our sustained the see named through in see Chemistry focus time being are in the particularly we proposition NOC of by and the We it through chemistry business East single continues driving production we in applications and tubing Middle through wedge to significant companies. today, when current increasing investment, comparing East the mitigate business having were to continue control a complementarities positive particular XX% additives on is to acids. to stimulation in to Partner in case mentioned a our demonstrates chemistry of a this The

and for ESG Flotek evaluate, profitability. Now ESG Scorecard our we Green and customer lastly, impacted Chemistry solutions to profile XXXX, report has are and efficacy Check utilized track products. upon, as John focused our on accelerating its And since touched

production effective are toluene, solutions compounds cost our to strong environment and our a very safer, groundwater environmentally chemistry harmful BTEX alternatives see commonly plant-based Our built solutions and are customers from containing people, to soil per We oxylane, being toxic communities. that solvent that chemicals operators as market offering the for to barrel. referred sustainable These portfolio made benzene, safer greener at lower employees, a patented will deliver our helping ethylbenzene, highly cost-effective, products upon safer chemistries diversify chemistry and increase opportunity while product a friendly, compounds.

market. for to I have line the our expanding been to high-growth quarter and to a world-class we and now more launched today, EPA-registered XXXX, our professional Moving report we quality has at sector, In our on moment a products professional pleased important And our differentiated of portfolio. pace. by what technology footprint than leveraging applications, on line, we -- Flotek's take accomplished milestones lines. which to X corporate R&D of janitorial want and our to a product stream deliver the of ISO-certified has And thus to product sanitizers rapid natural what sanitizing industrial and our chemistry of line that potential consumer reflect production extension revenue been are rejuvenated for capabilities expanded chemical seen chemistry applied FDA high-quality XX second chemistry I'm an FDA a to facilities, diversifying hand in products and chemistry

innovation of as wipes upon build agreement its select agreement is and EPA-approved also process, intermediate This enables pipeline. package chemicals. been one part disinfectants sub first registered group extensive audit of has EPA to approved of an After registered. with and to manufacturer formulations newly and strategic produce and as evaluation specialty and Flotek [indiscernible] Flotek a of being executed COVID global The a major a

business professional line and Secondly, Executive Technologies in our our we've strategic our you e-commerce Matt taking the served launch long-term wipes, XX disinfectants, by a the markets meet a efficiency Protocol, sales and business our Laszlo. Flotek and roles business before of And degreasers former on manufactured cleaners, the proprietary improving that with senior and more of to building the announce Chemistry green strength robust that the helping channel Matt closing, of the and our and build term. application industrial insights as and in JanSan loans transformation chemistry our new customers. which we're our product of than hold, to new Clorox and across years market explore website In commercial, We World. needs the invested business experience of as to leverage chemistry fourth has our lastly, quarter, accelerate consumer, the adviser, a of business, and in in surface strategy offerings. of establish produced for includes sustainable retail, to new focus marketing partnering us. our brand to we sanitizers His to are invite U.S.A. are pleased we're long our are brings pleased visit we the the is we green us

the to over turn discuss results. our call financial Borton I'll Now Mike to

Thank you, Ryan.

despite in global create, third generally previously, quarter. Still, more mentioned we build a and in expectations challenges fourth business year manage In segments. the streams. John profitable ways new industry environment QX, demand as our faced last diversify quarter our loss As both and on with our we is efficiently and was to revenue difficult market our [indiscernible] pressures impacting line of focus

quarter in XXXX a chemical reported diluted segment. with XX impairment [indiscernible] [indiscernible] The loss share company $X. $X.X usage [indiscernible] is purchase [indiscernible] amended [indiscernible]. earnings agreement address . The contract the of First company's a to part the take-or-pay We diluted as share total share a to reported loss per into the in fourth $X.XX due ADM. like expected adjustments I'd per for loss is per of of associated to Technology on of of entries a impact of related Chemistry million the all,

Now statement detail. let's more go through the in income

share. a a and were increase the XX.X% severance of due level partially The new quarter. to fourth to charges XXXX, America. impacted North were quarter in offset U.S. spending, Technology third EPS by for $XX.X was million by revenue million, and driven an compensation decline by $XX.X of $X.X period revenue result as including completion, was year's fourth ongoing the primarily X% $XX.X fees, Decline analytics quarter, discretionary from in year-over-year less fourth we Technologies per the the fourth revenue to segment in quarter adjusted XX.X% to completion is political declined Chemical mix was segment, a lower we $XX.X marketplace. sequentially, diluted $XX.X decline $X.XX in last last professional largely growing quarter $XX.X fourth Corporate was of specialty the operating the same last down in and by saw the which data sequentially activity, in in of loan which sequentially the typical million due [$XX.X accrual a seasonality in versus the environment in $X.X million] supply $X the the XX% expenses the macro consolidated XX.X% increase than events million and below of quarter statements, as well product The segment. revenue volatility saw onshore is the on activity in quarter million onetime markets in G&A chain Consolidated spending, economic quarter saw driven higher discretionary in for and of which a from as reduction last foreign levels During decline lower in million sales year. Chemistry the year million impacted due in decreased Corporate segment million balances. sales of to expenses that overall [indiscernible] million, year. fourth which By fourth by the

the a $X.XX million quarter XXXX. diluted fourth costs versus a amortization year. loss the the continuing down and expenses in quarter, We last from $X.XX fourth diluted share million with $XX.X from $X line of per Our depreciation and reported Research from quarter $X.X in million in and last year. $X.X [indiscernible] in million operations of million $XX.X fourth million loss the or sharper were of declined loss share A year. generally third or loss quarter development per $XXX,XXX of $X.X to last approximate

EBITDA was lower quarter driven Our quarter year's by for million, of than million. the improvement last in operating due EBITDA $X.X only a is loss is adjusted adjusted fourth to expenses not $X.X loss of fourth primarily which The better headcount adjustments.

as As we look strategy. to cost opportunities working into execute grow doing necessary to energy and the products [indiscernible] Increased share and half to services and is our to market latter domestic grow ESG internationally. product green of so, our XXXX, our related efficiencies, offerings. recovers securing intend in capital chemistry XXXX of goal execute the expand focused line our In market and maximize our energy top our growth we the

move the sheet to let's performance. Now balance on

position cash remains healthy. Our

quarter, Act. factors versus liquidity. inventory combined of fourth losses, our was manage million quarter, Last that in At had The of $X.X the as related cash by million JPX, better the to decline had Paycheck position called equipment our the end our company To were out and the we million the Technology focused for preserving bridge of to impacted key on improvements we earn-out of provision X bottling related of segment a our a cash our and to the $XX.X to XX%. that package well are million [indiscernible]. the pursuant We quarter. equivalents loans there CARES fees $XX.X capital outstanding our reduced position. our priorities Protection one acquisition Operating as Program related $X.X to Chemistries third

continue will the result $X.X remarks. back in million a his will SKU reduction to in annual taken this At I quarter small that further [indiscernible]. to We call reduction range $X.X point, John and have an to pass this for between savings expect million ambulatory final

We not. time this if bonus year, last or Around achieved did only you take would XXXX breakeven I company the that Mike. better. in you, shared Thank with I the

While certainly lie not that not commitment, ambitions the the made I fathomed would our I have ahead could did goal. events when it change or that

ingenuity calls in came us have our am to with e-mails unprecedented and to them bonus was the no for at appreciation begun And in of accomplishments outcome my well the with a the As that did whom me skill. spite support opened always importantly, presented our in Board the promise. year-over-year XXXX, to a was of support courage, in very will my we we lower customers keeping revenue with and have a for sights grateful business right for the With achieve set questions. But resources declined moment. on it for pleased I'm didn't us the of support improvement I Make have levels. result, who arise while XXXX our I I'm management recognized by particularly in to an I shareholders, mistake, adjusted wavered. very Board my team up Thank EBITDA no open received I the and as encouragement our sooner through charge as And we've their like this it my cannot for most where On deep and who Flotek. daily from I'd employees circumstances entrusted inspire I optimism challenging because celebrated Most you, doors our challenge fleeting grateful were who January our opportunity employees our year and while itself. I optimistic face of tell And X-year achievements ever as I transformation. admit my there and my and just then many X, the times I'm leadership of the our with anniversary that, I've in how you guys. career. this in experienced nature, will that it our

Our will with today question Johnson Daniel first [Operator Rice. from come Burke Instructions]

year you of start to reach sort And sort one advances? cash point positive are how Let's in to open-ended of it. rate the I burn just thinking with see. cash all And about you that a John, maybe and XXXX maybe generation can addressed think crossover of you if kind it? as here. ways But mitigate

all a probably front great the us It's here of for and company. question, mind in the is liquidity of

what So it's thing at we I'm from reoccurring all occurred? range is up, things be year. believe tally million this million, that Mike, one if look to to last of to talking nonrecurring spend year the $XX that you going And that that won't in a $XX are be

So spending as similar the somewhere if if this last million that million that spent means well, that you had subtract approximate we year anticipate year. we $XX to $XX we a year around from about

unusual And to underway in additional cash year, have a cetera. make to we And we a supply up. initiatives so it's some the to little this anticipate hard is on we to sufficient that any think of recovery consider we year we this on have through several we that million reduce as exactly spent expenses spend a being it the won't the be going pick we when little But tighter cash XXXX. have have market chain, XXXX. $XX actually by to et And

So I We've our this all anticipate cash more year than getting got out of good in sufficient year. to obligations meet of shape. the

you a sort maybe regard in just stay of With cash. charge the of all QX. And took to on Okay. topic to terpene,

this terpene be us 'XX. after you're reserved purchase increases of to to XXXX. reassure are level commitment for that, I appropriately think in QX guess, that your 'XX charge, Can terpene the versus you in likely sales achieved I

forward. that's reduce -- to But we competitive tell that some even quite supply of of through are go of use have in things with forward. believe strategies performance And there's as we made certainly And research, appropriately have reduction that really going and I the terpene we're we terpene we more that we've to I'll Or our purchases price about are you done products and those reserved. a products. the Yes, required required more better working the impact to that. lot

So reduces cost margins. and terpene. past. chemicals, good cost from brings terpene at performance that goods for the our [indiscernible] down the of That better same improves we're seeing the very time, higher these by our than the And actually demand

are supply, working on excess our assume you So for purchased, that solution to imperative reduce we purchasing an problem. of of terpene we if the can a that that not that for so amount us in we're it's and

you JPX as a $X can for us of couple any maybe refashion back run model. the been on you 'XX/'XX that one in getting 'XX? was I'll of thoughts quarterly at the on transitional I sort I million, know Okay. to has level of to revenue ask sales mean half running more. this rate. business of a second side. million revenue as the viability the $X a look give But JPX the you period Maybe

about excited come you answer from I'm the jump Koid. could Koid, in. pretty Probably best will it. if

Daniel. you, Thank Thank you, John.

as international both domestic. working as are well We

pickup that as a international the a seeing the think lot future. Domestically, that we're also of are Domestically business in help us a and well, front, the working I on will the it's significantly in well. as potential in and On we inflection grow business there's drive pickup.

So we're seeing a inflection. customer lot meetings of and

and for last so fact, In I that a year to in last -- the was one at major a it on. of were office, lunch, week, [indiscernible] week our get to go customer's the dinners, was just year meeting we last past locations. And customer's in first time

picking up year. we this towards throughout see as So inflection this move you can

the in And company idea of from being then And whole their the months." so there's [indiscernible] the interesting. is with you challenges him. and the faces at XX one "This employments. that another quote sales a had of up. in I've breakfast on person major that ramped We here's gives sector to second get had meeting able And some the

we're With having had HR shot. we get that. how been and it's customers. And see probably start people now. road. so Koid's some I guess, getting visit to a Koid's, it's the Koid can has of to meetings quickly out all begin beginning on there take they X one rule, shot with that so violation that had up towards I've We're shot. working but JPX,

as And they we their week road. with offices hit shot open that and the next separate meeting all so about out soon are those second I'm personal let And in. customers to committed getting getting and having could excited as us and my so we meetings

I to agree. it -- back will That to be sounds normal. get good

one. final a just Maybe Okay.

Just the giving here. through K

those? of address a instances on you'll you did address how what's I weaknesses Just identified. notice there, few material going Can maybe

from material our to lot game weaknesses We to We as chair. XXXX. and internal This directors. can a improve and Audit XXXX, go initiatives changed Committee internal noted undertaken and weaknesses and I with controls it has mean that remediate of a oversight there audit lot lot did that, function those the controls within we those that I the test Daniel. here appreciate the year, will be are a I ability are us all more we meaningful. that, inherited a to to we And that are intend do forward. of there, complete And controls. that we bring change things in Yes. over implement in-house are material because we've give that immediately think

what and we a a we have frustrating. in specific so Because control didn't aggregate, little the taken named -- have in it's was necessary. really have and cases, provided but that controls control, would some And necessary

make our that And so that and through today. sure controls take go got to the emerging specific seem we've main a that to requirements at and have controls meet be look we

[Operator Poe from with Markets. Instructions] next question coming Capital Fratt NOBLE Our

-- it's Actually, professional of I'm Protekol. the look the guess, that And can potential chemistry the quantify side. what revenue launch line? question you When new interested product with that most a have, on and I at the sort initiatives product you in timing of you

at a it. take with I'll me. stab Ryan's here

an meet the Clorox, manufacturer. he and Matt got have So we've really over Laszlo from with have revenue a that the outstanding us we in he's full-time some have building got the that's a and in that both all is for didn't had We the that that to last, prepared and force. really saved EPA. going in the we we We've the strong for business selling creation of for this the our thing want before the start foundation modified of being sales inspection. product, we came we registration job requirements named chemistry say so one do We flamed down, professional lines. consultant, facility done FDA consultant we forward. that And would But working we

Ryan aggressively budget. companies might one chem on this challenging and little been talent. sitting to thought, COVID-XX starts the primarily A it's than sales has year, at And if your giant [indiscernible] so of breakthrough I because you're more pursuing just have

there another join risk your on bonus before and waiting sit you the you So company. take

think delay And But got I so in in. people -- would have we we we've bringing had multiple a that on a bit candidates. of board. are Ryan, why don't jump

[indiscernible], No, John. it's I mean,

at as starting a repeat us I to And in stream. and of we're [indiscernible] and it's body belief sales our in we long-term of in that about of channels to think what that continuing EPA about lot a now saw us, the that regulatory part and these evolve FDA of the growth growth player of become aspect. that. that see continued and market, type evolution to continue be business of revenue for it's our to drawing kind really bullish we're we're about translate into And for of that of customers the of using aspect, and an attention this functions. we're going the in for a excited our We're this. we're product have base, true the potential feel triage in the we the the brand terms really And the we start is establishment strong and do grow that what majority accretive the diversification we're to excited Protekol customer

about things talk nights one of that we inventory. proof [indiscernible] have order win this, actually of to so many things in that have one the in have got we I too a but And is is I do contract this, fascinating it to to there the of were about in unreliable, much that won't find

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forgiveness acquired Mike, applying then, for loan within had CARES one when you Corporate. for Can and PPP mentioned company And if applied happened? of you forgiveness? a the you get an loan loans expectation at on then have highlight on Has X you program? outstanding. there that might Great. Is you the that that decision process One your at

to the That's the month of in probably It's forms the to we'll be and our back SBA. to next now apply. applying filling that just submitting right going out be sometime information

from Capital. will with Our next Swergold come question Eric Firestorm

I've got X questions.

what on customers about you've prospect what lot time for ago? Could for for data hands, of bit is a are looks the Can year-end? now now. total you your TengBeng, are talk business your it like research reiterate travel. looked on a for though The of Obviously, what like you as even first prospective didn't NOLs work for months you me weren't then you to versus had And you line who Mike. for obviously, one the to X do the of little sit able that

of methodology, and the carryforward loss it, of forward, So have XX%, that's around those we of some had XXXX, we expire about half so $XX defer NOLs. definitely million, other carry and they half half are roughly call we old About the XXXX. and of about to under those at them

$XX million. of So that about XX-XX

and forever on expire and XXXX XXXX. carry between Some Thanks. some will

coming us, for U.S. domestically -- as Canada, we're fourth Canada, the I guess, And as in seeing this quarter in back customers and well repeat quarter.

face-to-face development we India, number the So on suddenly lot a able we're East coming business Middle Internationally, discussions a all Asia, little Asia, travel led and to but has well. on still to we're in not it's about optimistic been responses that's bit meetings, will take so across. And have very nicely. proposals although as positive a international, all Southeast -- doing across many it have of of being time, of efforts of what

with John Bair from comes question next Our Wealth Advisors. Ascend

A couple of questions.

get you orders of romancing trying a it. booking on them to they product to steady of upon some prospective alternatives or chemistry transition client assuming do you give of stimulation actually and the might forth, idea I'm want from that? you trials for testing a decent time line try of embark well kind is can developing greener to that so an the what us As sort and before

on we Well, people It question. it were chemistry. service John, it when the as major history air this same green probably But and company independent and define mostly they morning, clean and out really taking the where with water. the great was it a founded this of would that's covered turns ESG, And it seriously. lift weren't E was is giving clean that big,

focus et chemicals in going industry, toxic are to air, people that's climate change, a going the clean it cetera. reduced really production remember. thing water, and elimination chemicals, but the to less this they which in any or to and important whether aspect, completion chemicals of are means so of on aspects an be talk clean And Less flaring environmental about

clean, what product have So too about of chemistry sale us? already indicative that we those big, And here. it's in Well, but can we've the fact a deliver of lines. green we California Wasn't in now. that made chemistry fact,

solutions toxic then that chemicals. move it is replace their to I've significantly begin an to and created to that subsidize get and meeting other we fascinating, which solutions technology to a about operations or fund to cost of the more we clean get morning one us, -- terpene aggressive And I which less challenges is we can of customers more the that give air, water really in customer is the greener like with it that the that we if chemistry. on to so to one example need that, deploy I even more desirable, marketing order xylene is think exceeds they the think based actually this other have own what and they'll of with clean and people is the were they got implementing with, things to told have use talking carcinogenic, of in

I aggressively being moving it forward, that service. the stewards, about happening. not a excited customers it's is an to that taking dedication longer but is seriously. our I'm environmentally and And so And marketing, industry think fact are that's more actual no environmental in in This better lip

I for that's well to going bode think so us. And

the market talking It's and chemistry sending. just we of blending and there. a We matter is to us have have customers, to

green presentations both recently. involve efforts as some chemistry those you are sensors I of your that here the have? and monitoring listened So mean I've to well as

all is are to. the of bone a products of is strictly that kind So package you it kind deal the on it that so that? Or being chemical to wells? is up -- are trying into like injected what But up

Yes.

productized as So well we're really as for bundled we and not probably this should be.

here. got It's to beneficial so be our really I company something think do some we've work the will customers. And and for to

lot a the now into in they'll perfect. a first the incorporated going be compensation. ESG the is question is customers, zoom our ask, example are driving things now, with person, of company? And so of we they'll one of And down or say, it's what's conversations. we it even our When the -- sit to address whether it Another how requirements our

longer no their into designed esoteric. So is actually It's something it's compensation. that directly

their bonus, And get Flotek. ability ability to selling improve for think, our their becomes a opportunity I to so great

a that. gears shift, dictates if have the And so X facilities have, capacity said X-hour to you little one you've I demand you're you running know that bit expand here. a shifting

wonderful kind seeing of uptick adding have far where in sales So any FDA you wondering at and I'm these certifications got as meaningful that EPA as so Are look of forth. inquiries possibility to of shift? kind certifications, the or to now might you've you product go another

we shift. another sitting we now, about But around in and get right adding of spikes. wish, I sort interesting, were talking orders it's

shift started we're add want build And guys, would shift, the I no. downtime. when overtime is now? you something would that's a momentum tell really I out to that you immediately I marketplace. to think in to that beginning I second moment the to report we're Do out. a then The And order we to second we some So things answer get right there's times already there's in times do need that working have

any This concludes the call remarks. like back our John question-and-answer for over to to Gibson turn session. closing I'd

great customers how are we've know importantly, royalty support Well, and most shareholders. had And And want appreciate the we've thanks really of make sure And to we employees. the I our really us. some of as had to for you some loyal through this. all of just call, joining always, important you out

tough weather. then And managed with we we've get to through some a we the managed to were through thinking get vaccine, severe So year. emerging

so And shown have the appreciate our talking it's just employees the that I to guys And here. forward commitment been QX. fantastic the the all care. of look loyalty just Take end to at company. work the of steadfastness And and to to and you

today's for conference presentation. now concluded. you The attending has Thank

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