Flowco Holdings Inc. Reports Fourth Quarter and Full Year 2024 Results

HOUSTON–(BUSINESS WIRE)–Flowco Holdings Inc. (NYSE: FLOC) (“Flowco” or the “Company”), a provider of production optimization, artificial lift and methane abatement solutions for the oil and natural gas industry, today announced financial results for the fourth quarter and full year ended December 31, 2024.

The financial results for 2024 and 2023 represent periods (i) during which Flowco’s operating subsidiary, Flowco MergeCo LLC (“Flowco LLC”), was a privately-owned limited liability company and (ii) prior to Flowco’s initial public offering in January 2025. Historical financial information for the year ended 2024 reflects information for Flowco LLC, and historical financial information presented prior to June 20, 2024 reflects only the historical financial information of Estis Compression LLC (“Estis”) as the accounting predecessor prior to the business combination of Estis, Flowco Production Solutions, L.L.C. (“FPS”) and Flogistix, LP (“Flogistix”) and parent entities formed in connection with such business combination (the “2024 Business Combination”). For pro forma financial information for the nine-month period ended September 30, 2024, refer to page 25 of the Company’s final Prospectus dated January 15, 2025 filed with the U.S. Securities and Exchange Commission (“SEC”) on January 16, 2025 (the “Final Prospectus”).

Key Company Highlights

  • On January 15, 2025, Flowco consummated an initial public offering of 20.47 million shares (including exercise in full of underwriters’ option of 2.67 million shares)
  • During January 2025, Flowco utilized IPO net proceeds of $461.8 million primarily to pay down borrowings on our revolving credit facility (“Revolving Credit Facility”)
  • Invested materially in surface equipment and vapor recovery rental fleet, increasing active systems based on growing customer demand
  • Demonstrated continued innovation including deployment of first electric multi-well high pressure gas lift (“HPGL”) unit (the “eGrizzly”) and grew sales of recently commercialized SurgeFlow plunger lift lubricator and the VRX modular vapor recovery unit

Key Financial Highlights

  • Pro forma revenues of $733.3 million in 2024, up 10% compared to $665.3 million in 20231
  • Fourth quarter 2024 revenue of $186.0 million, generating net income of $22.3 million and Adjusted Net Income2 of $28.8 million
  • Fourth quarter 2024 Adjusted EBITDA2 of $73.8 million
  • Fourth quarter 2024 Adjusted EBITDA Margin2 of 39.7%

Financial Summary

Three Months Ended

Year Ended December 31,

December 31,

2024

September 30,

2024

December 31,

2023

2024

2023

(in thousands)

Revenues

$

185,993

$

189,365

$

75,462

$

535,278

$

243,323

Net income

22,336

20,646

18,061

80,249

58,089

Adjusted Net Income (2)

28,779

31,179

18,484

99,283

59,344

Adjusted EBITDA (2)

73,779

74,036

34,513

223,661

122,501

Adjusted EBITDA Margin (2)

39.7

%

39.1

%

45.7

%

41.8

%

50.3

%

(1)

Pro forma 2024 revenue has been derived from the application of pro forma adjustments to the historical consolidated financial statements of Flowco LLC, as the predecessor of Flowco, and the historical consolidated financial statements of Estis, FPS and Flogistix, as predecessor or significant acquirees.

(2)

Adjusted Net Income, Adjusted EBITDA, and Adjusted EBITDA Margin are non-GAAP financial measures. See definitions of these measures and the reconciliation of GAAP to non-GAAP financial measures outlined in the reconciliation tables accompanying this press release.

Pro Forma Financial Summary

Year Ended December 31,

2024

2023

(in thousands)

Net revenues (1)

$

733,259

$

665,311

(1)

Pro forma 2024 revenue has been derived from the application of pro forma adjustments to the historical consolidated financial statements of Flowco LLC, as the predecessor of Flowco, and the historical consolidated financial statements of Estis, FPS and Flogistix, as predecessor or significant acquirees.

Joe Bob Edwards, President and CEO, commented, “Today is the beginning of an exciting new chapter for Flowco as we report our first earnings as a publicly traded company following our successful IPO in January. Thanks to the hard work and persistent efforts of the team that has built this business over the last decade, we feel we are well positioned to continue executing on our growth strategy while delivering industry-leading returns.

2024 was a transformational year for Flowco. Our year-over-year revenue and EBITDA growth underscores our ability to grow in an industry where our customers are continuously focused on production and capital efficiency. Our top quartile EBITDA margins illustrate the differentiation of our products, equipment, and technology, which enable our customers to produce oil and natural gas more efficiently while reducing downtime. We are also differentiated by our vertically integrated manufacturing operations and a supply chain that is located solely in the United States, providing a competitive advantage amidst an uncertain geopolitical environment.

In 2025, we plan to continue investing in our business while maintaining capital discipline and our focus on providing attractive returns on capital employed. With our strategic focus on production optimization, we are levered to resilient cash flows driven by our customers’ non-discretionary, production-oriented expenditures. Based on identified customer demand and a stable U.S. production outlook, we expect continued growth in 2025 as we deliver high-value outcomes to our growing customer base.”

Segment Information

We report our results in two segments, Production Solutions and Natural Gas Technologies. Production Solutions includes the rental, sale and service associated with high pressure gas lift, conventional gas lift and plunger lift, including a range of digital solutions and other production related technologies. Natural Gas Technologies includes the design, manufacture, rental and sale of vapor recovery and natural gas systems. Corporate costs not directly related to either segment are categorized separately.

Segment Financial Information

Three Months Ended

Year Ended December 31,

December 31,

2024

September 30,

2024

December 31,

2023

2024

2023

(in thousands)

Production Solutions

Revenues

$

113,330

$

111,686

$

44,896

$

327,805

$

168,801

Adjusted Segment EBITDA (1)

49,929

47,441

30,785

161,354

114,005

Adjusted Segment EBITDA Margin (1)

44.1

%

42.5

%

68.6

%

49.2

%

67.5

%

Natural Gas Technologies

Revenues

$

72,663

$

77,679

$

30,566

$

207,473

$

74,522

Adjusted Segment EBITDA (1)

27,802

26,595

3,728

66,259

8,496

Adjusted Segment EBITDA Margin (1)

38.3

%

34.2

%

12.2

%

31.9

%

11.4

%

Corporate

Revenues

$

$

$

$

$

Adjusted Segment EBITDA (1)

(3,952

)

(3,952

)

Adjusted Segment EBITDA Margin (1)

nm

nm

nm

nm

nm

Total

Revenues

$

185,993

$

189,365

$

75,462

$

535,278

$

243,323

Adjusted EBITDA (1)

73,779

74,036

34,513

223,661

122,501

Adjusted EBITDA Margin (1)

39.7

%

39.1

%

45.7

%

41.8

%

50.3

%

(1)

Adjusted Segment EBITDA and Adjusted Segment EBITDA Margin are non-GAAP financial measures. See definitions of these measures and the reconciliation of GAAP to non-GAAP financial measures outlined in the reconciliation tables accompanying this release.

Production Solutions

Fourth quarter 2024 revenue for the Production Solutions segment increased 1.5% from the third quarter of 2024, with Adjusted Segment EBITDA increasing 5.2% quarter over quarter for the same periods. The increases resulted from higher operating leverage combined with a slight shift in revenue mix between surface equipment and downhole solutions.

Natural Gas Technologies

Fourth quarter 2024 revenue for the Natural Gas Technologies segment decreased 6.5% from the third quarter of 2024 as anticipated, primarily due to the completion of a large customer project within the natural gas systems business unit in the first half of the quarter. Adjusted Segment EBITDA increased 4.5% quarter over quarter for the same periods, with Adjusted Segment EBITDA Margins up 400 basis points due to the strong performance of vapor recovery, offsetting the impact of the decline in revenues from natural gas systems.

Corporate

Corporate Adjusted Segment EBITDA for the quarter ended December 31, 2024 was $3.9 million, and there was no corporate Adjusted Segment EBITDA in the quarter ended September 30, 2024. The decrease in corporate Adjusted Segment EBITDA was primarily associated with the establishment of our public, corporate function in anticipation of our initial public offering.

Balance Sheet & Liquidity

As of March 14, 2025, borrowings on the Revolving Credit Facility were $195.7 million. With a borrowing base of $723.5 million, we had availability under the Revolving Credit Facility of $527.7 million.

Dividend Policy

As discussed in the Final Prospectus, we currently intend to pay a dividend from available funds and future earnings on our Class A common stock. As of the date of this press release, the Flowco board of directors has not made any determination regarding our future dividend policy, but expects to consider adopting a policy following the first quarter of 2025. Because we are a holding company, our ability to pay cash dividends on our Class A common stock depends on our receipt of cash distributions from Flowco LLC, and, through Flowco LLC cash distributions and dividends from our other direct and indirect subsidiaries. Our ability to pay dividends may be restricted by the terms of our Revolving Credit Facility and any future credit agreement or any future debt or preferred equity securities of us or our subsidiaries.

Conference Call and Webcast Information

Flowco will host a conference call on Tuesday, March 18, 2025, at 8:00 am. Eastern Time to discuss our fourth quarter and full year 2024 results. The conference call can be accessed live over the phone by dialing 1-877-704-4453 (for the U.S.) or 1-201-389-0920 (for International). A telephonic replay of the conference call will be available two hours after the call and can be accessed by dialing 1-844-512-2921 (for the U.S.) or 1-412-317-6671 (for International). The passcode for the call and replay is 13751953. A live webcast of the conference call will also be available under the Investor Relations section of Flowco’s website at ir.flowco-inc.com.

About Flowco

Flowco is a leading provider of production optimization, artificial lift and methane abatement solutions for the oil and natural gas industry. The company’s products and services include a full range of equipment and technology solutions that enable oil and natural gas producers to efficiently and cost-effectively maximize the profitability and economic lifespan of their assets.

Forward-Looking Statements

The information in this press release includes forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts contained in this press release may be forward-looking statements. These statements generally relate to future events or our future financial or operating performance, and include, but are not limited to: statements regarding guidance or estimates related to the Company’s results of operations or financial condition; industry trends, customer demand and industry outlook, and effects on Flowco’s operations; Flowco’s strategies and plans, including matters relating to the Company growth, capital expenditures, dividend policies, and leverage profile. When used in this press release, words such as “expect,” “project,” “estimate,” “believe,” “anticipate,” “intend,” “plan,” “seek,” “forecast,” “target,” “predict,” “may,” “should,” “would,” “could,” and “will,” the negative of these terms and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Forward-looking statements are based on management’s current expectations and assumptions, and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although Flowco believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. These risks and uncertainties are described further in the sections titled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” of the Final Prospectus and in Item 1A under the heading “Risk Factors” and elsewhere in our annual report on Form 10-K for the year ended December 31, 2024 to be filed with the SEC. Flowco undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this press release. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.

Flowco MergeCo LLC

Consolidated Statements of Operations

Three Months Ended

Year Ended December 31,

December 31,

2024

September 30,

2024

December 31,

2023

2024

2023

(in thousands)

Revenues

Rentals

$

91,705

$

87,240

$

44,896

$

276,687

$

168,801

Sales

94,288

102,125

30,566

258,591

74,522

Total revenues

185,993

189,365

75,462

535,278

243,323

Operating expenses

Cost of rentals (exclusive of depreciation and amortization disclosed separately below)

25,538

25,274

10,797

74,494

42,179

Cost of sales (exclusive of depreciation and amortization disclosed separately below)

65,857

75,535

26,209

189,930

62,599

Selling, general and administrative expenses

26,249

25,012

3,531

62,453

15,219

Depreciation and amortization

34,360

30,581

11,744

90,862

43,822

Loss on sale of equipment

70

72

406

797

1,170

Income from operations

33,919

32,891

22,775

116,742

78,334

Other expenses

Interest expense

(10,171

)

(11,861

)

(4,285

)

(32,345

)

(18,956

)

Loss on debt extinguishment

(221

)

(221

)

Other expense, net

(943

)

252

(429

)

(2,756

)

(910

)

Total other expense

(11,114

)

(11,830

)

(4,714

)

(35,322

)

(19,866

)

Income before provision for income taxes

22,805

21,061

18,061

81,420

58,468

Provision for income taxes

(469

)

(415

)

(1,171

)

(379

)

Net income

$

22,336

$

20,646

$

18,061

$

80,249

$

58,089

Earnings per unit:

Basic and diluted

$

2.23

$

2.06

$

3.54

$

10.41

$

11.39

Weighted average units outstanding:

Basic and diluted

10,000,000

10,000,000

5,100,000

7,710,656

5,100,000

Flowco MergeCo LLC

Consolidated Balance Sheets

As of December 31,

2024

2023

(in thousands, except unit data)

Assets

Current assets

Cash and cash equivalents

$

4,615

$

Accounts receivable, net of allowances for credit losses of $1,169 and $1,259, respectively

120,353

44,399

Inventory, net

151,179

31,336

Prepaid expenses and other current assets

9,982

2,837

Total current assets

286,129

78,572

Property, plant and equipment, net

702,616

292,223

Operating lease right-of-use assets

19,480

4,424

Finance lease right-of-use assets

21,871

3,391

Intangible assets, net

302,522

11,254

Goodwill

249,692

2,224

Other assets

6,639

Total assets

$

1,588,949

$

392,088

Liabilities and members’ equity

Current liabilities

Accounts payable

$

31,321

$

6,351

Accrued expenses

33,829

7,391

Current portion of operating lease obligations

6,809

640

Current portion of finance lease obligations

7,837

1,737

Deferred revenue

8,002

1,515

Total current liabilities

87,798

17,634

Long-term liabilities

Long-term debt, net

635,916

235,265

Operating lease obligations, net of current portion

15,556

3,784

Finance lease obligations, net of current portion

10,572

1,654

Total long-term liabilities

662,044

240,703

Total liabilities

749,842

258,337

Commitments and contingencies

Members’ equity

Class A Units, no par value, 10,000,000 issued and outstanding as of December 31, 2024 and 5,100,000 issued and outstanding as of December 31, 2023

Additional paid-in capital

892,099

36,479

Retained earnings (deficit)

(52,992

)

97,272

Total members’ equity

839,107

133,751

Total liabilities and members’ equity

$

1,588,949

$

392,088

Flowco MergeCo LLC

Consolidated Statements of Cash Flows

Year Ended December 31,

2024

2023

2022

(in thousands)

Cash flows from operating activities

Net income

$

80,249

$

58,089

$

32,729

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

90,862

43,822

36,206

Provision for inventory obsolescence

1,809

2,510

335

Amortization of operating right-of-use assets

4,326

508

219

Amortization of deferred financing costs

714

400

400

Loss on sale of equipment, net

797

1,170

51

Loss on debt extinguishment

221

(Gain)/loss on lease termination

(958

)

Share-based compensation

992

85

493

Allowance for (recovery of) credit losses

636

310

509

Changes in operating assets and liabilities:

Accounts receivable – trade

(15,487

)

(16,886

)

(13,779

)

Inventory

21,920

(6,633

)

9,274

Prepaid expenses and other current assets

(3,029

)

(1,295

)

(171

)

Other assets

864

Other liabilities

739

Operating lease liabilities

(1,429

)

(508

)

(219

)

Accounts payable

(4,292

)

(515

)

(2,411

)

Accrued expenses

864

805

2,928

Deferred revenue

2,402

Net cash provided by operating activities

182,200

81,862

66,564

Cash flows used in investing activities

Purchase of property, plant and equipment

(90,494

)

(43,514

)

(106,961

)

Proceeds from sale of property, plant and equipment

166

841

31

Payment for capitalized patent costs

(193

)

Acquisitions, net of cash acquired

(7,000

)

Net cash acquired in 2024 Business Combination

3,088

Net cash used in investing activities

(94,433

)

(42,673

)

(106,930

)

Cash flows used in financing activities

Payments on long-term debt

(298,764

)

(173,525

)

(107,789

)

Proceeds from long-term debt

462,438

188,361

188,118

Payments on finance lease obligations

(10,320

)

(1,525

)

(1,748

)

Proceeds on finance lease terminations

715

(1,215

)

Payment of debt issuance costs

(6,708

)

Distribution to Members

(230,513

)

(52,500

)

(37,000

)

Net cash (used in) provided by financing activities

(83,152

)

(39,189

)

40,366

Net change in cash and cash equivalents

4,615

Cash and cash equivalents

Beginning of period

End of period

$

4,615

$

$

Supplemental disclosures of investing and financing activities

Cash paid for interest

$

28,775

$

18,899

$

8,668

Supplemental schedule of non-cash investing and financing activities

Noncash debt refinancing of long-term debt with Revolving Credit Facility

$

419,454

$

$

Issuance of 4.9 million Class A Units in exchange for the net assets acquired in a Business Combination

$

854,628

$

$

Issuance of 5.1 million Class A Units in exchange for 1,000 Common Units of Estis

$

$

$

Lease liabilities arising from obtaining operating right-of-use assets

$

5,532

$

4,524

$

2,434

Lease liabilities arising from obtaining financing right-of-use assets

$

8,391

$

2,186

$

234

Non-GAAP Financial Measures

In addition to our results determined in accordance with generally accepted accounting principles in the United States (“GAAP”), the Company uses non-GAAP financial measures, such as Adjusted Net Income, EBITDA and Adjusted EBITDA, as well as Adjusted Segment EBITDA and Adjusted Segment EBITDA Margin, in this press release to supplement financial information presented in accordance with GAAP. We believe that excluding certain items from our GAAP results provides management additional insight on the consolidated financial performance from period to period to project our future consolidated financial performance as forecasts are developed at a level of detail different from that used to prepare GAAP-based financial measures. Moreover, we believe these non-GAAP financial measures provide our management and investors with useful information to help them evaluate our operating results by facilitating an enhanced understanding of our operating performance and enabling them to make more meaningful period to period comparisons. There are limitations to the use of the non-GAAP financial measures presented in this press release. For example, our non-GAAP financial measures may not be comparable to similarly titled measures of other companies. Other companies, including companies in our industry, may calculate non-GAAP financial measures differently than we do, limiting the usefulness of those measures for comparative purposes. Non-GAAP measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. The Company urges investors to review the reconciliation and not to rely on any single financial measure to evaluate our business.

Adjusted Net Income

Adjusted Net Income is a non-GAAP measure that we define as net income (loss) adjusted to eliminate the impact of (i) transaction-related expenses, (ii) share-based compensation, (iii) loss on the sale of equipment, (iv) loss on debt payments and (v) changes to the value of our inventory. Adjusted Net Income is a supplemental non-GAAP financial measure used by management, our stockholders and others to provide visibility on the profitability and financial strength of the Company by excluding certain expenses related to non-recurring Company transactions.

Reconciliation from net income to Adjusted Net Income is set forth as follows:

Three Months Ended

Year Ended December 31,

December 31,

2024

September 30,

2024

December 31,

2023

2024

2023

(in thousands)

Net income

$

22,336

$

20,646

$

18,061

$

80,249

$

58,089

Transaction-related expenses (1)

2,727

1,833

5,810

Share-based compensation expense (2)(3)

483

356

17

992

85

Loss on sale of equipment

70

72

406

797

1,170

Loss on debt extinguishment

221

221

Inventory valuation adjustments (4)

3,163

8,051

11,214

Adjusted Net Income

$

28,779

$

31,179

$

18,484

$

99,283

$

59,344

Contacts

Investor Contact:
Andrew Leonpacher

investor.relations@flowco-inc.com

Media Contact:
Niki Sikinger

Niki.Sikinger@flowco-inc.com

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