Natural Gas Services (NYSE: NGS) acquires Flatrock in $120M accretive deal
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Natural Gas Services Group completed the acquisition of Flatrock Compression Holdings for total consideration of $120 million, consisting of $110 million in cash and 241,803 newly issued common shares plus contingent royalty payments. Management highlights the deal as immediately and materially accretive, valued at about 6.2x last‑quarter annualized Adjusted EBITDA.
The acquisition adds a high-quality rental compression fleet of roughly 86,000 horsepower that is 95% utilized, significantly expanding large-horsepower and electric motor driven offerings and increasing basin density in the Permian and Eagle Ford. NGS also diversified its customer base by adding multiple new large E&P customers, reducing concentration with existing key customers.
To support the transaction, NGS entered into a Fifth Amendment to its credit agreement, increasing its committed revolving credit facility from $400 million to $500 million while retaining a $100 million accordion feature. The company reports a pro forma leverage ratio of approximately 3x and indicates substantial undrawn capacity to fund ongoing organic growth initiatives.
Positive
- Accretive, strategically focused acquisition: NGS acquired Flatrock for a total of $120 million at an implied ~6.2x last‑quarter annualized Adjusted EBITDA multiple, describing the deal as immediately and materially accretive while adding high-utilization, large-horsepower and electric compression capacity in core basins.
Negative
- None.
Insights
NGS is using a leveraged but still moderate balance sheet to complete an accretive, basin-focused compression acquisition.
Natural Gas Services Group is paying a total of $120 million for Flatrock, split between $110 million cash and $10 million in stock (241,803 shares). The implied ~6.2x last‑quarter annualized Adjusted EBITDA multiple is below the ~7.8x multiple cited for NGS, creating immediate multiple arbitrage for existing shareholders.
The acquisition adds about 86,000 rented horsepower that is 95% utilized, with roughly 60,000 large horsepower units and about 20% of horsepower in electric units. This deepens NGS’s presence in the Permian Basin and Eagle Ford and accelerates its shift into larger and electric compression where demand has been strong.
NGS increased its revolving credit facility from $400 million to $500 million, with a $100 million accordion that could take commitments to $600 million, and discloses a pro forma leverage ratio of about 3x. That represents higher financial leverage but, according to the company, leaves meaningful liquidity and flexibility for further organic growth and potential future capital returns.
8-K Event Classification
6 items: 1.01, 2.01, 2.03, 3.02, 7.01, 9.01
6 items
Item 1.01
Entry into a Material Definitive Agreement
Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 2.01
Completion of Acquisition or Disposition of Assets
Financial
The company completed a significant acquisition or sale of business assets.
Item 2.03
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement
Financial
The company incurred a new significant debt or off-balance-sheet obligation.
Item 3.02
Unregistered Sales of Equity Securities
Securities
The company sold equity securities in a private placement or other unregistered transaction.
Item 7.01
Regulation FD Disclosure
Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Total purchase price: $120 million
Cash portion of consideration: $110 million
Equity consideration: 241,803 shares
+5 more
8 metrics
Total purchase price
$120 million
Flatrock acquisition consideration (cash and stock)
Cash portion of consideration
$110 million
Cash paid for Flatrock under Purchase Agreement
Equity consideration
241,803 shares
NGS common stock issued to Flatrock sellers
Acquisition EBITDA multiple
6.2x Adjusted EBITDA
First quarter 2026 LQA Adjusted EBITDA (pre-synergies)
Credit facility increase
$400M to $500M
Committed revolving facility expanded via Fifth Amendment
Accordion feature
$100 million
Potential extra commitments up to $600M total, if approved
Pro forma leverage ratio
approximately 3x
Leverage after Flatrock acquisition, per credit definition
Flatrock rented horsepower
86,000 HP
Current rented compression fleet with ~95% utilization
Key Terms
Adjusted EBITDA, representation and warranty insurance policy, accordion feature, leverage ratio, +1 more
5 terms
Adjusted EBITDA financial
"purchase price represents an approximate 6.2x Adjusted EBITDA multiple and it is immediately accretive"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
representation and warranty insurance policy regulatory
"the Company’s sole and exclusive recourse for breaches ... is the representation and warranty insurance policy"
accordion feature financial
"The accordion feature of the credit facility remains at $100 million, which if approved by the lenders would increase the maximum commitments to $600 million"
An accordion feature is a clause in a loan or financing agreement that allows a company to expand the size of a credit line or the amount of securities available under the same contract without drafting a completely new deal. Like a suitcase that can be extended to hold more items, it gives a company quick flexibility to raise extra money, which can help fund growth but may increase debt or dilute existing shareholders—so investors watch it for changes in risk and ownership.
leverage ratio financial
"NGS remains prudently leveraged with pro forma leverage ratio of approximately 3x"
Leverage ratio measures how much a company relies on borrowed money compared with its own funds or assets, typically expressed as debt relative to equity or total assets. Like a homeowner with a mortgage, higher leverage can amplify returns when business is strong but also raises the chance of big losses or default if revenue falls, so investors use it to judge financial risk and resilience.
non-GAAP financial measures financial
"This Release includes financial measures that are not in accordance with accounting principles generally accepted ... such as “Adjusted EBITDA.”"
Non-GAAP financial measures are numbers companies use to show their financial performance that exclude certain expenses or income. They help investors see how the company might perform without one-time costs or other unusual items, giving a different perspective from official reports. However, since they can be adjusted, they don’t always tell the full story and should be looked at alongside standard financial figures.
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): June 12, 2026
(Exact Name of Registrant as Specified in Charter)
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
(Address of Principal Executive Offices)
(432 ) 262-2700
(Registrant's Telephone Number, Including Area Code)
N/A
(Former Name or Former Address if Changed Since Last Report)
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 (see General Instruction A.2. below):
| Securities registered pursuant to Section 12(b) of the Act: | ||||||||||||||
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 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(a) of the Exchange Act. o
Item 1.01 Entry into a Material Definitive Agreement.
Flatrock Acquisition
On June 12, 2026, Natural Gas Services Group, Inc., a Colorado corporation (the “Company”), entered into a Securities Purchase Agreement (the “Purchase Agreement”) with Flatrock Compression Holdings LLC, a Delaware limited liability company (“Flatrock”), the holders of all of the membership interests of Flatrock (each, a “Seller” and, collectively, the “Sellers”), and Mule Deer Sky LLC, a Texas limited liability company, solely in its capacity as the Sellers Representative under the Purchase Agreement (the “Sellers Representative”). The transaction closed simultaneously with the execution of the Purchase Agreement on June 12, 2026.
Pursuant to the Purchase Agreement, the Company acquired 100% of the issued and outstanding membership interests (the “Equity Interests”) of Flatrock from the Sellers in exchange for (i) 241,803 shares of common stock, par value $0.01 per share (the “Common Stock”), of the Company (the “Equity Consideration”), (ii) $110 million in cash, subject to customary adjustments for cash, indebtedness, net working capital and transaction expenses, and (iii) the right to receive certain royalty payments pursuant to the Royalty Agreement (as defined below). Of the aggregate consideration, $2,250,000 in cash was deposited into escrow at closing to secure post-closing purchase price adjustment obligations. In connection with the transaction, the Company, Flatrock and the Sellers Representative also entered into a royalty agreement (the “Royalty Agreement”), pursuant to which the Sellers are entitled to receive contingent royalty payments based on future revenues attributable to certain of Flatrock’s products and services. These payments constitute deferred contingent consideration for the Equity Interests.
The Purchase Agreement contains customary representations and warranties for transactions of its type. In addition, the Purchase Agreement contains certain post-closing covenants by the Sellers, including continuing confidentiality obligations. The representations and warranties of the Sellers and Flatrock contained in the Purchase Agreement do not survive the closing, and, except in the case of actual fraud, the Company’s sole and exclusive recourse for breaches of such representations and warranties is the representation and warranty insurance policy obtained by the Company in connection with the transaction covering certain representations and warranties set forth in the Purchase Agreement.
The representations, warranties and covenants contained in the Purchase Agreement have been made solely for the benefit of the parties thereto. In addition, such representations, warranties and covenants (i) have been made only for purposes of the Purchase Agreement, (ii) have been qualified by matters (a) with respect to the Company specifically disclosed in any reports filed by the Company with the Securities and Exchange Commission (the “SEC”) prior to the date of the Purchase Agreement and (b) made in confidential disclosure schedules delivered in connection with the Purchase Agreement, (iii) are subject to materiality qualifications contained in the Purchase Agreement which may differ from what may be viewed as material by investors, (iv) were made only as of the date of the Purchase Agreement or such other date as is specified in the Purchase Agreement and (v) have been included in the Purchase Agreement for the purpose of allocating risk between the contracting parties rather than establishing matters as fact. Accordingly, the Purchase Agreement is included with this filing only to provide investors with information regarding the terms of the Purchase Agreement, and not to provide investors with any other factual information regarding the parties thereto or their respective businesses. Investors should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the parties to the Purchase Agreement or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Purchase Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures. The Purchase Agreement should not be read alone, but should instead be read in conjunction with the other information regarding the Company that is or will be contained in, or incorporated by reference into, the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and other documents that the Company files with the SEC.
The foregoing description of the Purchase Agreement does not purport to be complete and is subject to and qualified in its entirety by reference to the full text of the Purchase Agreement attached hereto as Exhibit 2.1.
Fifth Amendment to Credit Agreement
On June 12, 2026, the Company and the guarantors from time to time party thereto entered into the Fifth Amendment to Amended and Restated Credit Agreement with Texas Capital Bank, as administrative agent, and the lenders party thereto (the “Fifth Amendment”). Among other changes, the Fifth Amendment provides for additional commitments (the “Additional Commitments”) under the Company’s existing revolving credit facility, increasing the commitments from $400 million to $500 million, and permits the acquisition of Flatrock contemplated by the Purchase Agreement. In connection with the Additional Commitments, Regions Bank joined the credit facility as a new lender, and certain of the existing lenders increased their commitments. The accordion feature of the credit facility remains at $100 million, which if approved by the lenders would increase the maximum commitments to $600 million, subject to collateral availability.
The foregoing description of the Fifth Amendment does not purport to be complete and is subject to and qualified in its entirety by reference to the full text of the Fifth Amendment attached hereto as Exhibit 10.1.
Item 2.01 Completion of Acquisition or Disposition of Assets.
The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.01.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.
Item 3.02 Unregistered Sales of Equity Securities.
The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02. The issuance of the Equity Consideration to the Sellers was completed in reliance upon the exemption from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), provided by Section 4(a)(2) thereof as a transaction by an issuer not involving any public offering. The Company relied on this exemption from registration based in part on representations made by the Sellers.
Item 7.01 Regulation FD Disclosures.
On June 15, 2026, the Company issued a press release announcing the closing of the acquisition of Flatrock contemplated by the Purchase Agreement. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated into this Item 7.01 by reference.
On June 15, 2026, the Company posted supplemental information in an investor presentation (the “Presentation Materials”) regarding the acquisition of Flatrock contemplated by the Purchase Agreement. A copy of the Presentation Materials is furnished as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated into this Item 7.01 by reference.
The information in this Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1 and Exhibit 99.2 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act amended, except as expressly set forth by specific reference in such filing. By filing this Current Report on Form 8-K and furnishing this information pursuant to Item 7.01, the Company makes no admission as to the materiality of any information in this Current Report on Form 8-K, including Exhibit 99.1 and Exhibit 99.2, that is required to be disclosed solely by Regulation FD.
Item 9.01 Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired
To be filed by amendment not later than 71 calendar days after the date this Current Report on Form 8-K is required to be filed.
(c) Pro Forma Financial Information
To be filed by amendment not later than 71 calendar days after the date this Current Report on Form 8-K is required to be filed.
(d) Exhibits
The following exhibits are included with this Current Report on Form 8-K:
| Exhibit No. | Description | ||||
2.1* | Securities Purchase Agreement dated June 12, 2026 by and among Natural Gas Services Group, Inc., Flatrock Compression Holdings LLC, the holders of all of the membership interests of Flatrock, and Mule Deer Sky LLC. | ||||
10.1 | Fifth Amendment to Amended and Restated Credit Agreement dated June 12, 2026, among the Company, the other Loan Parties party thereto, Texas Capital Bank, in its capacity as Administrative Agent and the Lenders party thereto. | ||||
99.1 | Press release issued by the Company on June 15, 2026. | ||||
99.2 | Presentation materials dated June 15, 2026 | ||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | ||||
* Certain annexes, schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company hereby undertakes to furnish supplemental copies of any of the omitted annexes, schedules and exhibits upon request by the SEC.
SIGNATURES
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 hereunto duly authorized.
NATURAL GAS SERVICES GROUP, INC. | |||||||||||||||||
| Date: | June 15, 2026 | By: | /s/ Justin C. Jacobs | ||||||||||||||
| Justin C. Jacobs | |||||||||||||||||
| Chief Executive Officer | |||||||||||||||||
| (Principal Executive Officer) | |||||||||||||||||
Exhibit 99.1
Natural Gas Services Group Acquires Flatrock Compression
June 15, 2026
•$120 million cash and stock acquisition is immediately and materially accretive
•Diversifies NGS's customer mix while adding multiple new large customers
•Strategic acquisition deepens NGS’s operational footprint across the Permian Basin and Eagle Ford
•Significantly expands the Company’s large horsepower and electric motor driven compression solutions
•Existing credit facility increased to $500 million in conjunction with acquisition
•NGS to host a conference call on Monday, June 15, 2026, at 10:00 a.m. Eastern Time
SOUTHLAKE, Texas, June 15, 2026 (GLOBE NEWSWIRE) -- Natural Gas Services Group, Inc. ("NGS" or the "Company") (NYSE: NGS), a leading provider of natural gas compression equipment, technology, and services to the energy industry, today announced that it has acquired Flatrock Compression Holdings ("Flatrock") for $120 million of consideration consisting of $110 million in cash and $10 million of newly issued NGS common stock.
Flatrock is a leading provider of rental compression services with operations in the Permian Basin and Eagle Ford. Founded in 2001, Flatrock has a current rented fleet of approximately 86,000 horsepower with a significant majority consisting of large horsepower units and electric motor driven units. Overall, the Flatrock fleet is currently 95% utilized by horsepower.
"This acquisition represents an important strategic step for NGS," said Justin Jacobs, Chief Executive Officer of NGS. "Flatrock has built a high-quality compression business with a strong reputation for field execution, operational excellence, and customer service. The company has assembled an attractive compression fleet, which has grown organically at comparable rates to NGS. "
"This acquisition increases our operational density in both the Permian Basin and Eagle Ford, adds meaningful customer diversification and attractive opportunities for growth with several new large customers, and complements our fleet with the addition of significant large horsepower and electric motor units. Just as importantly, Flatrock's culture aligns closely with ours, as both organizations are committed to safety, operational excellence, and delivering innovative and reliable compression solutions to customers. This is not only a strategic transaction, but also a highly attractive financial acquisition as the purchase price represents an approximate 6.2x Adjusted EBITDA multiple and it is immediately accretive to key financial metrics."
“I would like to welcome all the employees of Flatrock to NGS—together, we will continue to grow faster than our competitors and lead the industry in technology and innovation. I would also like to thank all the employees of NGS for their hard work and dedication as well as our lending partners, both existing and new, who helped facilitate this transaction.”
B.J. Ellis, Chief Executive Officer of Flatrock, said, "We are proud of the business our team has built and the reputation we have earned with our customers over many years. Our success has been driven by great people, operational discipline, technical expertise, and a relentless focus on customer service. After evaluating the opportunities available to our company, we believe NGS is the right partner to build upon that foundation. The combined organization will have greater scale, expanded capabilities, and additional growth opportunities for both our employees and customers. We are excited to join the NGS team and help drive the next phase of growth."
1
Exhibit 99.1
Compelling Strategic and Financial Acquisition
•Adds a high-quality rental compression business with strong field operations and an established reputation for customer service.
•Diversifies NGS's customer base while adding multiple new large customers.
•Increases operational density in the Permian Basin and Eagle Ford, enhancing service capabilities and operational efficiency.
•Adds a business with organic growth characteristics similar to NGS.
•Combines highly complementary fleets with similar mix of horsepower size, models, and key components including engine type and compressor type.
•Attractive acquisition multiple of 6.2x first quarter 2026 Annualized Adjusted EBITDA (pre-synergies)1.
•Highly accretive across key financial metrics and supportive of shareholder value creation.
•NGS remains prudently leveraged with pro forma leverage ratio of approximately 3x.
Expanded Credit Facility
In connection with the transaction, NGS entered into the Fifth Amendment to its existing credit agreement, which increased the Company’s committed credit facility from $400 million to $500 million while retaining the $100 million accordion feature that, subject to lender approval and collateral availability, can be used to increase the maximum commitment to $600 million. Following the transaction, the Company remains well-positioned with meaningful liquidity under its expanded credit facility.
Conference Call Details
NGS will host a conference call on Monday, June 15, 2026, at 10:00 a.m. Eastern Time to discuss the transaction and review the investor presentation released in the Form 8-K.
To listen to the call via webcast, please visit the Investor Relations section of the Company's website at www.ngsgi.com. Participants may also join by telephone by dialing (800) 550-9745 and entering conference ID: 167298. A replay of the conference call will be available on the Company's website following the event.
(1) Represents NGS management forecasted last quarter annualized (“LQA”) Adjusted EBITDA of Flatrock at March 31, 2026, based on financial information provided by Flatrock and excluding expected synergies. Adjusted EBITDA is a non-GAAP financial measure. Please see below under “Supplemental Non-GAAP Financial Measures.”
Advisors
Gibson, Dunn & Crutcher LLP served as legal advisor and Intrepid Partners, LLC served as financial advisor to NGS. Carol Burke of CBurke Legal PLLC and Nelson Mullins Riley & Scarborough LLP served as legal advisors and Amy Nelson of Greenridge Advisors, LLC served as financial advisor to Flatrock.
About Natural Gas Services Group, Inc.
Natural Gas Services Group is a leading provider of natural gas and electric compression equipment, technology and services to the energy industry. The Company rents, designs, installs, services and maintains natural gas and electric compressors for oil and natural gas production and processing facilities and midstream infrastructure. NGS is headquartered in Southlake, Texas, with an administrative office in
2
Exhibit 99.1
Midland, Texas, an assembly facility located in Tulsa, Oklahoma, and service facilities located in major oil and natural gas producing basins throughout the United States.
About Flatrock Compression Holdings
Flatrock Compression provides safe, reliable rental compression services to oil and natural gas producers and midstream companies utilizing both gas engine and electric motor driven compression. The company also delivers patented gas lift facility solutions designed to maximize production by minimizing downtime and reducing associated methane emissions. Flatrock operates throughout the Permian Basin and Eagle Ford regions of Texas and has served the oil and gas industry since 2001.
Cautionary Statement Regarding Forward-Looking Statements
This Release includes certain 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 information pertaining to us, the acquisition (the “Acquisition”) of Flatrock Compression Holdings, LLC (“Flatrock”), our industry and the oil and gas industry that is based on the beliefs of our management, as well as assumptions made by and information currently available to our management. All statements, other than statements of historical fact included in this Release are forward-looking statements. When used in this Release, the words “may,” “will,” "expect," “anticipate,” “estimate,” "guidance," “believe,” "continue," "intend," “plan,” “budget” and similar words are intended to identify forward-looking statements.
These forward–looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties and factors that could cause actual results to differ materially from such statements, many of which are outside the control of the Company. Forward–looking information includes, but is not limited to, statements regarding: the anticipated benefits of the Acquisition; the expectation that the acquisition will be immediately and meaningfully accretive; expectations regarding earnings, cash flow, and shareholder value creation; and expectations regarding future growth, competitive position, plans and objectives. The Company undertakes no obligation to revise these forward-looking statements to reflect events or circumstances that arise after the date hereof, except as required by applicable law. Such statements are subject to certain risks and uncertainties which are disclosed in the Company’s reports filed with the Securities and Exchange Commission (“SEC”), including its Form 10-K for the fiscal year ended December 31, 2025, and its other filings with the SEC. All forward-looking statements in this Release are expressly qualified by the cautionary statements and by reference to the underlying assumptions that may prove to be incorrect.
While the Company believes that the assumptions concerning future events are reasonable, investors are cautioned that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of its business. Some of these factors that could cause results to differ materially from those indicated by such forward-looking statements include, but are not limited to: (i) conditions in the oil and gas industry, including the supply and demand for oil and gas and volatility in the prices of oil and gas; (ii) changes in general economic conditions, inflationary pressures, the potential for impact on our financial condition, results of operations and cash flows; (iii) our reliance on major customers; (iv) failure of projected organic growth due to adverse changes in the oil and gas industry, including depressed oil and gas prices, oppressive environmental regulations and competition; (v) our inability to achieve increased utilization of assets, including rental fleet utilization and monetizing other non-cash balance sheet assets; (vi) failure of our customers to continue to rent equipment after expiration of the primary rental term; (vii) our ability to economically develop and deploy new technologies and services, including technology to comply with health and environmental laws and regulations; (viii) failure to successfully integrate and achieve accretive financial results in connection
3
Exhibit 99.1
with any acquisitions we may make, including the Acquisition; (ix) unforeseen liabilities acquired in the Acquisition; (x) fluctuations in interest rates; (xi) our ability to make dividends, distributions and share repurchases; (xii) changes in regulation or prohibition of new well or current completion techniques; (xiii) competition among the various providers of compression services and products; (xiv) changes in safety, health and environmental regulations; (xv) changes in economic or political conditions in the markets in which we operate; (xvi) the inherent risks associated with our operations, such as equipment defects, malfunctions, natural disasters and adverse changes in customer, employee and supplier relationships; (xvii) our inability to comply with covenants in our debt agreements and the decreased financial flexibility associated with our debt; (xviii) inability to finance our future capital requirements and availability of financing; (xix) cybersecurity threats, including increased use of artificial intelligence and other emerging technologies; (xx) capacity availability, costs and performance of our outsourced compressor fabrication providers and overall inflationary pressures; (xxi) impacts of world events, such as acts of terrorism, the conflicts in Iran, Ukraine, Venezuela and the greater Middle East, and significant economic disruptions and adverse consequences resulting from possible long-term effects of potential pandemics and other public health crises; and (xxii) general economic conditions.
The financial and operating estimates contained in this Release represent our reasonable estimates as of the date of this Release. Neither our independent auditors nor any other third party has examined, reviewed or compiled the estimates and, accordingly, neither of the foregoing expresses an opinion or other form of assurance with respect thereto. The assumptions upon which the estimates are based are described in more detail herein. Some of these assumptions inevitably will not materialize, and unanticipated events may occur that could affect our results. Therefore, our actual results achieved during the periods covered by the estimates will vary from the estimated results. Investors are not to place undue reliance on the estimates included herein.
Supplemental Non-GAAP Financial Measures
This Release includes financial measures that are not in accordance with accounting principles generally accepted in the United States (“GAAP”), such as “Adjusted EBITDA.” While management believes that such measures are useful for investors, they should not be used as a replacement for financial measures that are in accordance with GAAP. The Company defines “Adjusted EBITDA” as net income (loss) before interest, taxes, depreciation and amortization, as well as an increase in inventory allowance, impairments, retirement of rental equipment, nonrecurring restructuring charges including severance and non-cash equity-classified stock-based compensation expenses. This term, as used and defined by us, may not be comparable to similarly titled measures employed by other companies. Adjusted EBITDA should not be considered in isolation or as a substitute for operating income, net income or loss, cash flows provided by operating, investing and financing activities, or other income or cash flow statement data prepared in accordance with GAAP. However, management believes Adjusted EBITDA is useful to an investor in evaluating our operating performance. Note that to the extent forward-looking non-GAAP financial measures are provided herein, they are not reconciled to comparable forward-looking GAAP measures due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation. The Company defines “leverage” consistent with its credit facility and means, as of the last day of each fiscal quarter, the ratio of (i) all Funded Debt as of such date to (ii) Annualized EBITDA as of such date.
4
A C Q U I S I T I O N O F F L A T R O C K C O M P R E S S I O N PERFORMANCE UNDER PRESSURE J u n e 1 5 , 2 0 2 6 Exhibit 99.2
J U N E 2 0 2 6 Disclaimer and Forward-Looking Statements 2 Forward-Looking Statements This Presentation includes certain 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 information pertaining to us, the acquisition (the “Acquisition”) of Flatrock Compression Holdings, LLC (“Flatrock”), our industry and the oil and gas industry that is based on the beliefs of our management, as well as assumptions made by and information currently available to our management. All statements, other than statements of historical fact included in this Presentation are forward-looking statements. When used in this Presentation, the words “may,” “will,” "expect," “anticipate,” “estimate,” "guidance," “believe,” "continue," "intend," “plan,” “budget” and similar words are intended to identify forward-looking statements. These forward–looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties and factors that could cause actual results to differ materially from such statements, many of which are outside the control of the Company. Forward–looking information includes, but is not limited to, statements regarding: the anticipated benefits of the Acquisition; the expectation that the acquisition will be immediately and meaningfully accretive; expectations regarding earnings, cash flow, and shareholder value creation; and expectations regarding future growth, competitive position, plans and objectives. The Company undertakes no obligation to revise these forward-looking statements to reflect events or circumstances that arise after the date hereof, except as required by applicable law. Such statements are subject to certain risks and uncertainties which are disclosed in the Company’s reports filed with the Securities and Exchange Commission (“SEC”), including its Form 10-K for the fiscal year ended December 31, 2025, and its other filings with the SEC. All forward-looking statements in this Presentation are expressly qualified by the cautionary statements and by reference to the underlying assumptions that may prove to be incorrect. While the Company believes that the assumptions concerning future events are reasonable, investors are cautioned that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of its business. Some of these factors that could cause results to differ materially from those indicated by such forward-looking statements include, but are not limited to: (i) conditions in the oil and gas industry, including the supply and demand for oil and gas and volatility in the prices of oil and gas; (ii) changes in general economic conditions, inflationary pressures, the potential for impact on our financial condition, results of operations and cash flows; (iii) our reliance on major customers; (iv) failure of projected organic growth due to adverse changes in the oil and gas industry, including depressed oil and gas prices, oppressive environmental regulations and competition; (v) our inability to achieve increased utilization of assets, including rental fleet utilization and monetizing other non-cash balance sheet assets; (vi) failure of our customers to continue to rent equipment after expiration of the primary rental term; (vii) our ability to economically develop and deploy new technologies and services, including technology to comply with health and environmental laws and regulations; (viii) failure to successfully integrate and achieve accretive financial results in connection with any acquisitions we may make, including the Acquisition; (ix) unforeseen liabilities acquired in the Acquisition; (x) fluctuations in interest rates; (xi) our ability to make dividends, distributions and share repurchases; (xii) changes in regulation or prohibition of new well or current completion techniques; (xiii) competition among the various providers of compression services and products; (xiv) changes in safety, health and environmental regulations; (xv) changes in economic or political conditions in the markets in which we operate; (xvi) the inherent risks associated with our operations, such as equipment defects, malfunctions, natural disasters and adverse changes in customer, employee and supplier relationships; (xvii) our inability to comply with covenants in our debt agreements and the decreased financial flexibility associated with our debt; (xviii) inability to finance our future capital requirements and availability of financing; (xix) cybersecurity threats, including increased use of artificial intelligence and other emerging technologies; (xx) capacity availability, costs and performance of our outsourced compressor fabrication providers and overall inflationary pressures; (xxi) impacts of world events, such as acts of terrorism, the conflicts in Iran, Ukraine, Venezuela and the greater Middle East, and significant economic disruptions and adverse consequences resulting from possible long-term effects of potential pandemics and other public health crises; and (xxii) general economic conditions. The financial and operating estimates contained in this Presentation represent our reasonable estimates as of the date of this Presentation. Neither our independent auditors nor any other third party has examined, reviewed or compiled the estimates and, accordingly, neither of the foregoing expresses an opinion or other form of assurance with respect thereto. The assumptions upon which the estimates are based are described in more detail herein. Some of these assumptions inevitably will not materialize, and unanticipated events may occur that could affect our results. Therefore, our actual results achieved during the periods covered by the estimates will vary from the estimated results. Investors are not to place undue reliance on the estimates included herein. Supplemental Non-GAAP Financial Measures This Presentation includes financial measures that are not in accordance with accounting principles generally accepted in the United States (“GAAP”), such as “Adjusted EBITDA.” While management believes that such measures are useful for investors, they should not be used as a replacement for financial measures that are in accordance with GAAP. The Company defines “Adjusted EBITDA” as net income (loss) before interest, taxes, depreciation and amortization, as well as an increase in inventory allowance, impairments, retirement of rental equipment, nonrecurring restructuring charges including severance and non-cash equity-classified stock-based compensation expenses. This term, as used and defined by us, may not be comparable to similarly titled measures employed by other companies. Adjusted EBITDA should not be considered in isolation or as a substitute for operating income, net income or loss, cash flows provided by operating, investing and financing activities, or other income or cash flow statement data prepared in accordance with GAAP. However, management believes Adjusted EBITDA is useful to an investor in evaluating our operating performance. Note that to the extent forward-looking non- GAAP financial measures are provided herein, they are not reconciled to comparable forward-looking GAAP measures due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation. The Company defines “leverage” consistent with its credit facility and means, as of the last day of each fiscal quarter, the ratio of (i) all Funded Debt as of such date to (ii) Annualized EBITDA as of such date.
Acquisition of Flatrock 3 $120M Total purchase price ~6.2x LQA EBITDA (pre-synergies) ~80% Of HP in the Permian ~20% Electric fleet Reported last quarter annualized (“LQA”) Adjusted EBITDA of Flatrock at March 31, 2026, is based on financial information provided by Flatrock and excluding expected synergies Compelling Strategic & Financial Fit ~60k Large HP Units Added Transaction Overview ▪ $110M cash + $10M NGS common stock at the 30-day volume-weighted average price ▪ Acquired at ~6.2x LQA Adjusted EBITDA (pre-synergies) vs. NGS trading at ~7.8x; Immediate multiple arbitrage, meaningfully accretive to shareholders ▪ Expanded committed credit facility from $400 to $500 million in conjunction with the transaction retaining the existing $100 million accordion feature providing a potential total commitment of up to $600 million, subject to lender approval ▪ NGS maintains balance sheet flexibility with a prudent pro forma leverage position of ~3x with substantial undrawn capacity to support continued organic growth
Strategic Rationale 4 1 Proven Field Operations ▪ Experienced management and field operators with deep basin knowledge ▪ Further strengthens NGS’s operational capabilities by adding expertise to support continued scale 2 Diversifies Customer Mix 3 Increases Basin Density 5 Comparable Growth4 Complementary Fleet ▪ Oxy + Devon concentration reduced from 64% to 54% ▪ Adds two large publicly traded E&P customers in the Permian Basin ▪ Increases horsepower in Midland Basin creating density across the Permian ▪ Creates critical mass in the Eagle Ford Basin ▪ Flatrock has grown at comparable rates to NGS with significant opportunities to expand further ▪ NGS grew HP by ~15% and adjusted EBITDA by ~40% (both annually from 2023 to first quarter 2026) ▪ Expands NGS’s large horsepower compression scale with ~60k horsepower ▪ Accelerates NGS’s electric motor drive fleet growth; Flatrock has ~20% of HP in electric units High-quality fleet that scales NGS in its core basins at an accretive entry price
Occidental Petroleum: 35.5% Devon Energy: 18.6%New Customer 1: 4.6% New Customer 2: 3.5% A: 3.2% B: 2.5% C: 2.4% D: 2.3% E: 2.3% F: 2.0% Other: 23.2% Pro Forma Combined Customer Base Customer Diversification 5 Pro Forma Large Customer Concentration Occidental Petroleum Existing ~36% Devon Energy Existing ~19% Large New Customer 1 Via Flatrock ~5% Large New Customer 2 Via Flatrock ~4% Key Takeaways 3 Modest customer overlap between the two fleets 1 NGS's Oxy + Devon concentration falls from ~64% to ~54% 2 Adds two new large, publicly traded E&P customers Lower customer concentration and two new major E&P relationships
Basin Density 6 Complementary placement builds a stronger Permian Basin position and critical mass in the Eagle Ford ▪ NGS: More than 450,000 horsepower ▪ Flatrock: More than 70,000 horsepower Flatrock Fleet UnitsNGS Fleet Units ▪ Flatrock: More than 14,000 horsepower ▪ NGS: More than 19,000 horsepower Permian Basin Eagle Ford Shale (Gulf Coast)
Complementary Fleet 7 ▪ Flatrock’s highly complementary fleet strengthens NGS’s large horsepower and electric motor drive position ▪ Acquisition adds 52k HP of rented Large HP, to NGS’s 440k HP, creating a combined 492k rented large HP fleet (75% of total rented HP) ▪ Flatrock has ~20% of HP in electric units vs. NGS’s 7%, accelerating NGS’s positioning in the growing electric compression segment ▪ Both fleets are CAT-heavy (Flatrock 62%, NGS 49%), ensuring common parts, maintenance expertise, and operational synergies ▪ Ariel compressor frames make up 59% of Flatrock’s HP and 57% of NGS’s, allowing further leverage of distributor discounts NGS Flatrock Combined HP % HP % HP % Large 440,260 76.6% 52,230 60.7% 492,490 74.5% Medium 72,104 12.5% 23,987 27.9% 96,091 14.5% Small 62,605 10.9% 9,816 11.4% 72,421 11.0% Total Rented 574,969 100.0% 86,033 100.0% 661,002 100.0% Fleet Statistics Expands NGS’s Large-Horsepower Scale and Accelerates Electric Fleet Growth Fleet Classification: Large horsepower units are 380HP or more, medium horsepower are 200-379HP, and small horsepower are below 200HP.
Attractive Valuation 8 ▪ Total Purchase Price: $120 million; $110 million in cash and $10 million in common stock ▪ ~6.2x LQA Adjusted EBITDA multiple pre-synergies EBITDA Multiple Accretion Leverage Shareholder Returns ▪ Flatrock Adjusted EBITDA multiple trading at ~6.2x vs ~7.8x NGS multiple ▪ Immediate +20% multiple arbitrage for shareholders ▪ Transaction is meaningfully accretive to earnings per share and cash flow ▪ Expanded the Company’s credit facility from $400 to $500 million (with $100 million accordion) ▪ Continued balance sheet flexibility as the proforma leverage ratio at closing is expected to be ~3x ▪ Substantial undrawn capacity in excess of $130 million ▪ Equity valuation upside based on entry multiple and purchase price ▪ Enhances growth opportunities, cash flow, and ability to return capital to shareholders Immediate multiple arbitrage while maintaining balance sheet flexibility
NGS Growth Opportunities and Value Levers 9 Fleet Optimization ▪ Opportunity for targeted price increases due to inflation and high utilization ▪ Optimize operations through increased use of data Asset Utilization ▪ Increase utilization of the existing fleet ▪ Improve the marketability of small and medium HP assets via conversions and upgrades ▪ Sell or dispose of units where conversions or upgrades are not justified ▪ Convert non-cash assets into cash ▪ Working capital ▪ Income tax receivable ▪ Owned real estate Fleet Expansion ▪ Pre-contract units with strategic customers ▪ Primarily driven by large horsepower placements at centralized stations ▪ Meet or exceed target return on invested capital Accretive M&A ▪ Pursue value-adding acquisitions in compression rental and related businesses ▪ Value drivers: equipment type, basin location, customer mix ▪ Lower leverage results in better flexibility ✓ ✓ ✓ ✓
THANK YOU Investor Relations Contact: Glenn Wiener (917) 887-8434 ir@ngsgi.com Corporate Address 601 State St, Suite 400 Southlake, Texas 76092 I N V E S T O R P R E S E N T A T I O N | J U N E 2 0 2 6
FAQ
What did Natural Gas Services Group (NGS) pay to acquire Flatrock Compression?
NGS agreed to acquire Flatrock for total consideration of $120 million, made up of $110 million in cash and $10 million in newly issued NGS common stock (241,803 shares). Sellers also receive contingent royalty payments based on future revenues from certain Flatrock products and services.
How does the Flatrock acquisition change NGS’s compression fleet and horsepower?
Flatrock contributes a rented fleet of approximately 86,000 horsepower, with overall fleet utilization of about 95% by horsepower. The combined company will have roughly 661,002 rented horsepower, including about 492,490 horsepower in large units, strengthening its large-horsepower offering.
How is the Flatrock acquisition expected to affect NGS’s financial metrics?
NGS notes the acquisition price represents an approximate 6.2x Adjusted EBITDA multiple based on Flatrock’s first-quarter 2026 annualized Adjusted EBITDA and states the deal is immediately and materially accretive across key financial metrics, including earnings and cash flow, supporting shareholder value creation.
What changes did NGS make to its credit facility for the Flatrock transaction?
In connection with closing, NGS amended its credit agreement to increase the committed revolving facility from $400 million to $500 million, while retaining a $100 million accordion feature. This accordion, subject to lender approval and collateral availability, could raise total commitments to $600 million.
How does the Flatrock deal impact NGS’s leverage and liquidity position?
NGS reports a pro forma leverage ratio of approximately 3x after the acquisition, calculated under its credit agreement definition. Management states the company remains prudently leveraged with substantial undrawn capacity on its $500 million facility to support continued organic growth initiatives.
How does Flatrock change NGS’s customer mix and basin exposure?
The acquisition diversifies NGS’s customer base by adding multiple new large, publicly traded E&P customers, reducing the combined concentration from its two largest existing customers. It also increases operational density in the Permian Basin and creates critical mass in the Eagle Ford, improving basin coverage.