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:
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).
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. ☐
The information in this Item 2.02 and in Exhibit
99.1 shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), or otherwise subject to the liabilities of that Section, and shall not be incorporated by reference into
any filing under the Securities Act of 1933, as amended, or the Exchange Act regardless of any general incorporation language in such
filing, except as shall be expressly set forth by specific reference in such filing.
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.
Exhibit
99.1
Nine
Energy Service Announces Third Quarter 2026 Results
| ● | Revenue,
net loss and adjusted EBITDAA of $142.0 million, $(5.1) million and $8.3 million,
respectively, for the third quarter of 2026 |
| | | |
| ● | Cementing
revenue increased by 11% quarter over quarter |
| | | |
| ● | Total
liquidity as of September 30, 2026 of $46.0 million |
HOUSTON
– Nine Energy Service, Inc. (“Nine” or the “Company”) (NYSE American: NINE) reported third quarter
2026 revenues of $142.0 million, net loss of $(5.1) million, or $(0.36) per basic and diluted share, and adjusted EBITDA of $8.3 million.
“Our
third quarter financial results benefited from improving U.S. activity and stronger performance within Cementing, partially offset by
continued operating constraints in Coiled Tubing where one of our large-diameter units remained out of service, as well as lower international
Completion Tools activity compared with the second quarter due primarily to the timing of orders,” said Ann Fox, President and
Chief Executive Officer of Nine Energy Service.
“Cementing
delivered meaningful sequential improvement, supported by sustained customer demand, increased activity and continued market share gains.
Historically, Cementing has served as an early indicator of broader completion activity, and we remain encouraged by current trends and
the potential for improvement across our other completion-oriented businesses.”
“Based
on current market conditions, we expect the improvement in U.S. activity levels to continue into the fourth quarter of 2026, with our
cementing business positioned to benefit from sustained customer demand. Our large-diameter coiled tubing unit that remained out of service
during the third quarter may return to service in December.”
“The
pace of customer activity, the timing of the coiled tubing unit’s return, and the mix of product and service activity will continue
to influence our near-term performance. Based on these factors, we currently expect fourth quarter revenue to be flat, but profitability
to be modestly higher compared to the third quarter of 2026 due to a shift in revenue to our higher margin cementing and international
tools business.”
“Across
Nine, we remain focused on operational execution, technology development and cost discipline. We are encouraged by the stronger activity
and customer demand experienced in several areas of the business.”
Operating
Results
During
the third quarter of 2026, the Company reported revenues of $142.0 million, gross profit of $13.3 million and adjusted gross profitB
of $20.6 million.
During
the third quarter of 2026, the Company reported general and administrative (“G&A”) expense of $16.5 million. Depreciation
and amortization expense (“D&A”) in the third quarter of 2026 was $7.4 million.
The
Company’s tax provision for the third quarter was approximately $0.1 million, primarily attributed to state and non-U.S. jurisdictions.
Liquidity
and Capital Expenditures
During
the third quarter of 2026, the Company reported net cash provided by operating activities of $4.7 million. Capital expenditures totaled
$2.8 million during the third quarter of 2026 and $4.8 million during the second quarter of 2026. Capital expenditures totaled $1.9 million
for the period from January 1, 2026 through March 5, 2026 and $3.7 million for the period from March 6, 2026 through March 31, 2026.1
The Company’s full-year 2026 capital expenditures guidance remains unchanged at $20 to $30 million, with the expectation of coming
in near the midpoint of this range.
As
of September 30, 2026, Nine’s cash and cash equivalents were $16.1 million. As of September 30, 2026, the Company had $29.9 million
of availability under its revolving credit facility, resulting in a total liquidity position of $46.0 million as of September 30, 2026.
On September 30, 2026, the Company had $98.7 million of borrowings under its revolving credit facility.
ABSee
end of press release for definitions of these non-GAAP measures. These measures are intended to provide additional information only and
should not be considered as alternatives to, or more meaningful than, net income (loss), gross profit or any other measure determined
in accordance with GAAP. Certain items excluded from these measures are significant components in understanding and assessing a company’s
financial performance, such as a company’s cost of capital and tax structure, as well as the historic costs of depreciable assets.
Our computation of these measures may not be comparable to other similarly titled measures of other companies.
Conference
Call Information
The
call is scheduled for Tuesday, November 10, 2026, at 9:00 am Central Time. Participants may join the live conference call by dialing
U.S. (Toll Free): (877) 524-8416 or International: (412) 902-1028 and asking for the “Nine Energy Service Earnings Call”.
Participants are encouraged to dial into the conference call ten to fifteen minutes before the scheduled start time to avoid any delays
entering the earnings call.
For
those who cannot listen to the live call, a telephonic replay of the call will be available through November 24, 2026, and may be accessed
by dialing U.S. (Toll Free): (877) 660-6853 or International: (201) 612-7415 and enter passcode 13763046.
| 1 |
On
March 5, 2026 (the “Plan Effective Date”), the Company emerged from bankruptcy, and in connection therewith, the Company
applied fresh start accounting on such date. The application of fresh start accounting resulted in a new basis of accounting and the
Company becoming a new entity for financial reporting purposes, which is referred to as the “Successor.” The Company prior
to the application of fresh start account is referred to as the “Predecessor.” With the application of fresh start accounting,
the Company allocated its reorganization value to its individual assets based on their estimated fair value. The Plan Effective Date
fair values of the Successor’s assets and liabilities differ materially from their recorded values as reflected on the historical
balance sheet of the Predecessor. Accordingly, the Predecessor and Successor financial information are not comparable. For additional
information on the Company’s application of fresh start accounting, see Note 3 – Emergence from Bankruptcy in Item 1 of
Part I of the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2026. |
About
Nine Energy Service
Nine
Energy Service is an oilfield services company that offers completion solutions within North America and abroad. The Company brings years
of experience with a deep commitment to serving clients with smarter, customized solutions and world-class resources that drive efficiencies.
Serving the global oil and gas industry, Nine continues to differentiate itself through superior service quality, wellsite execution
and cutting-edge technology. Nine is headquartered in Houston, Texas with operating facilities in the Permian, Eagle Ford, Haynesville,
SCOOP/STACK, Niobrara, Barnett, Bakken, Marcellus, Utica and Canada.
For
more information on the Company, please visit Nine’s website at nineenergyservice.com.
Forward
Looking Statements
The
foregoing contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Forward-looking statements are those that do not state historical facts and are, therefore, inherently
subject to risks and uncertainties. Forward-looking statements also include statements that refer to or are based on projections, uncertain
events or assumptions. Forward-looking statements included herein relate to, among other things, our strategy and prospects, future operations,
financial position and financial results, estimated future revenues and earnings. All forward-looking statements included herein are
based on current expectations and entail various risks and uncertainties that could cause actual results to differ materially from those
forward-looking statements. Such risks and uncertainties include, among other things, the level of capital spending and well completions
by the onshore oil and natural gas industry, which may be affected by geopolitical and economic developments in the U.S. and globally,
including conflicts, instability, acts of war or terrorism in oil-producing countries or regions, particularly Iran and elsewhere in
the Middle East, Russia, South America and Africa, as well as actions by members of the Organization of the Petroleum Exporting Countries
and other oil-exporting nations; general economic conditions and inflation, particularly cost inflation with labor or materials; the
effects of tariffs and other trade measures on the Company’s business and on the onshore oil and natural gas industry generally;
equipment and supply chain constraints; the Company’s ability to attract and retain key employees, technical personnel and other
skilled and qualified workers; the Company’s ability to maintain existing prices or implement price increases on our products and
services; pricing pressures, reduced sales or reduced market share as a result of intense competition in the markets for the Company’s
dissolvable plug products; conditions inherent in the oilfield services industry, such as equipment defects, liabilities arising from
accidents or damage involving our fleet of trucks or other equipment, explosions and uncontrollable flows of gas or well fluids, and
loss of well control; the Company’s ability to implement and commercialize new technologies, services and tools; the Company’s
ability to grow its completion tool business domestically and internationally; our recent emergence from bankruptcy, which may adversely
affect our business and relationships; seasonal and adverse weather conditions; the adequacy of the Company’s capital resources
and liquidity, including the ability to meet its debt obligations; the Company’s ability to manage capital expenditures; the Company’s
ability to accurately predict customer demand, including that of its international customers; the loss of, or interruption or delay in
operations by, one or more significant customers, including certain of the Company’s customers outside of the United States; the
loss of or interruption in operations of one or more key suppliers; the incurrence of significant costs and liabilities resulting from
litigation; cybersecurity risks; changes in laws or regulations regarding issues of health, safety and protection of the environment;
and other factors described in the “Risk Factors” and “Business” sections of the Company’s most recently
filed Annual Report on Form 10-K and subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Readers are cautioned
not to place undue reliance on forward-looking statements, which speak only as of the date hereof, and, except as required by law, the
Company undertakes no obligation to update those statements or to publicly announce the results of any revisions to any of those statements
to reflect future events or developments.
Nine
Energy Service Investor Contact:
Josh
Riley
Senior Vice President, Corporate Finance and Investor Relations
(281) 730-5100
investors@nineenergyservice.com
NINE
ENERGY SERVICE, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)
(In
Thousands, Except Share and Per Share Amounts)
(Unaudited)
| | |
Successor | |
| | |
Three Months Ended | |
| | |
September 30,
2026 | | |
June 30,
2026 | |
| | |
| | |
| |
| Revenues | |
$ | 142,005 | | |
$ | 141,806 | |
| Cost and expenses | |
| | | |
| | |
| Cost of revenues (exclusive of depreciation and amortization shown separately below) | |
| 121,432 | | |
| 121,866 | |
| General and administrative expenses | |
| 16,452 | | |
| 15,609 | |
| Depreciation | |
| 7,242 | | |
| 7,038 | |
| Amortization of intangibles | |
| 205 | | |
| 205 | |
| Loss (gain) on sale of property and equipment | |
| 18 | | |
| (23 | ) |
| Loss from operations | |
| (3,344 | ) | |
| (2,889 | ) |
| Interest expense | |
| 1,908 | | |
| 1,878 | |
| Interest income | |
| (116 | ) | |
| (99 | ) |
| Other income | |
| (164 | ) | |
| (162 | ) |
| Loss before income taxes | |
| (4,972 | ) | |
| (4,506 | ) |
| Provision for income taxes | |
| 112 | | |
| 384 | |
| Net loss | |
$ | (5,084 | ) | |
$ | (4,890 | ) |
| | |
| | | |
| | |
| Loss per share | |
| | | |
| | |
| Basic | |
$ | (0.36 | ) | |
$ | (0.35 | ) |
| Diluted | |
$ | (0.36 | ) | |
$ | (0.35 | ) |
| Weighted average shares outstanding | |
| | | |
| | |
| Basic | |
| 13,949,990 | | |
| 13,949,990 | |
| Diluted | |
| 13,949,990 | | |
| 13,949,990 | |
| | |
| | | |
| | |
| Other comprehensive loss (income), net of tax | |
| | | |
| | |
| Foreign currency translation adjustments, net of tax of $0 and $0 | |
$ | 130 | | |
$ | (96 | ) |
| Total other comprehensive income (loss), net of tax | |
| 130 | | |
| (96 | ) |
| Total comprehensive loss | |
$ | (4,954 | ) | |
$ | (4,986 | ) |
NINE
ENERGY SERVICE, INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS
(In
Thousands)
(Unaudited)
| | |
Successor | |
| | |
September 30,
2026 | | |
June 30,
2026 | |
| | |
| | |
| |
| Assets | |
| | |
| |
| Current assets | |
| | |
| |
| Cash
and cash equivalents | |
$ | 16,050 | | |
$ | 16,849 | |
| Restricted
cash | |
| 1,404 | | |
| 1,400 | |
| Accounts
receivable, net | |
| 91,787 | | |
| 91,599 | |
| Inventories,
net | |
| 56,991 | | |
| 48,769 | |
| Prepaid
expenses | |
| 8,798 | | |
| 11,307 | |
| Other
current assets | |
| 1,551 | | |
| 1,375 | |
| Total
current assets | |
| 176,581 | | |
| 171,299 | |
| Property and equipment, net | |
| 102,131 | | |
| 106,572 | |
| Operating lease right of use
assets, net | |
| 27,888 | | |
| 30,293 | |
| Finance lease right of use
assets, net | |
| 70 | | |
| 36 | |
| Intangible assets, net | |
| 8,693 | | |
| 8,898 | |
| Other
long-term assets | |
| 577 | | |
| 557 | |
| Total
assets | |
$ | 315,940 | | |
$ | 317,655 | |
| Liabilities
and Stockholders’ Equity | |
| | | |
| | |
| Current liabilities | |
| | | |
| | |
| Accounts
payable | |
$ | 46,249 | | |
$ | 44,448 | |
| Accrued
expenses | |
| 16,142 | | |
| 13,927 | |
| Income
taxes payable | |
| 499 | | |
| 381 | |
| Current
portion of long-term debt | |
| — | | |
| 1,606 | |
| Current
portion of operating lease obligations | |
| 12,881 | | |
| 12,695 | |
| Current
portion of finance lease obligations | |
| 50 | | |
| 37 | |
| Total
current liabilities | |
| 75,821 | | |
| 73,094 | |
| Long-term liabilities | |
| | | |
| | |
| Long-term
debt | |
| 98,728 | | |
| 97,344 | |
| Long-term
operating lease obligations | |
| 14,610 | | |
| 17,188 | |
| Other
long-term liabilities | |
| 892 | | |
| 459 | |
| Total
liabilities | |
| 190,051 | | |
| 188,085 | |
| | |
| | | |
| | |
| Stockholders’ equity | |
| | | |
| | |
| Successor common stock (70,000,000
shares authorized at $0.01 par value; 13,949,990 and 13,949,990 shares issued and outstanding at September 30, 2026 and June 30,
2026, respectively) | |
| 139 | | |
| 139 | |
| Additional
paid-in capital | |
| 136,911 | | |
| 135,638 | |
| Accumulated
other comprehensive income (loss) | |
| 66 | | |
| (64 | ) |
| Accumulated
deficit | |
| (11,227 | ) | |
| (6,143 | ) |
| Total
stockholders’ equity | |
| 125,889 | | |
| 129,570 | |
| Total
liabilities and stockholders’ equity | |
$ | 315,940 | | |
$ | 317,655 | |
NINE
ENERGY SERVICE, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In
Thousands)
(Unaudited)
| | |
Successor | |
| | |
Three
Months Ended | |
| | |
September 30,
2026 | | |
June 30,
2026 | |
| | |
| | |
| |
| Cash flows from operating
activities | |
| | |
| |
| Net loss | |
$ | (5,084 | ) | |
$ | (4,890 | ) |
| Adjustments to reconcile net
loss to net cash provided by (used in) operating activities | |
| | | |
| | |
| Depreciation | |
| 7,242 | | |
| 7,038 | |
| Amortization of intangibles | |
| 205 | | |
| 205 | |
| Amortization
of deferred financing costs and non-cash interest | |
| 2,027 | | |
| 1,905 | |
| Amortization
of operating leases | |
| 3,664 | | |
| 3,618 | |
| Provision
for doubtful accounts | |
| 223 | | |
| 4 | |
| Provision
for inventory obsolescence | |
| 91 | | |
| 203 | |
| Stock-based
compensation expense | |
| 1,273 | | |
| 573 | |
| Loss
(gain) on sale of property and equipment | |
| 18 | | |
| (23 | ) |
| Changes
in operating assets and liabilities, net of effects from acquisitions | |
| | | |
| | |
| Accounts
receivable, net | |
| (396 | ) | |
| (3,343 | ) |
| Inventories,
net | |
| (8,266 | ) | |
| 1,554 | |
| Prepaid
expenses and other current assets | |
| 2,335 | | |
| 1,488 | |
| Accounts
payable and accrued expenses | |
| 5,165 | | |
| (7,426 | ) |
| Income
taxes receivable/payable | |
| 113 | | |
| 13 | |
| Operating
lease obligations | |
| (3,667 | ) | |
| (3,606 | ) |
| Other
assets and liabilities | |
| (230 | ) | |
| 391 | |
| Net
cash provided by (used in) operating activities | |
| 4,713 | | |
| (2,296 | ) |
| Cash flows
from investing activities | |
| | | |
| | |
| Proceeds from sales of property
and equipment | |
| — | | |
| 182 | |
| Purchases
of property and equipment | |
| (3,958 | ) | |
| (4,057 | ) |
| Net
cash used in investing activities | |
| (3,958 | ) | |
| (3,875 | ) |
| Cash flows
from financing activities | |
| | | |
| | |
| Proceeds from Exit ABL Facility | |
| — | | |
| 5,000 | |
| Payments of short-term debt | |
| (1,606 | ) | |
| (2,372 | ) |
| Principal
payments on finance leases | |
| (27 | ) | |
| (13 | ) |
| Net
cash provided by (used in) financing activities | |
| (1,633 | ) | |
| 2,615 | |
| Impact
of foreign currency exchange on cash | |
| 83 | | |
| (60 | ) |
| Net decrease in cash, cash
equivalents, and restricted cash | |
| (795 | ) | |
| (3,616 | ) |
| Cash, cash
equivalents, and restricted cash | |
| | | |
| | |
| Beginning of period | |
| 18,249 | | |
| 21,865 | |
| End of period | |
$ | 17,454 | | |
$ | 18,249 | |
NINE
ENERGY SERVICE, INC.
RECONCILIATION
OF ADJUSTED EBITDA
(In
Thousands)
(Unaudited)
| | |
Successor | |
| | |
Three
Months Ended | |
| | |
September 30,
2026 | | |
June
30,
2026 | |
| Net loss | |
$ | (5,084 | ) | |
$ | (4,890 | ) |
| Interest expense | |
| 1,908 | | |
| 1,878 | |
| Interest income | |
| (116 | ) | |
| (99 | ) |
| Depreciation | |
| 7,242 | | |
| 7,038 | |
| Amortization of intangibles | |
| 205 | | |
| 205 | |
| Provision
for income taxes | |
| 112 | | |
| 384 | |
| EBITDA | |
$ | 4,267 | | |
$ | 4,516 | |
| Restructuring charges and
other expenses (1) | |
| 1,921 | | |
| 2,714 | |
| Stock-based compensation | |
| 1,273 | | |
| 573 | |
| Cash award expense | |
| 798 | | |
| 814 | |
| Loss
(gain) on sale of property and equipment | |
| 18 | | |
| (23 | ) |
| Adjusted
EBITDA | |
$ | 8,277 | | |
$ | 8,594 | |
| (1) | For
the three months ended September 30, 2026 and June 30, 2026, amounts relate to professional
fees incurred after the Plan Effective Date in relation to the Chapter 11 Cases as well as
other costs associated with restructuring initiatives. |
NINE
ENERGY SERVICE, INC.
RECONCILIATION
OF ADJUSTED GROSS PROFIT (LOSS)
(In
Thousands)
(Unaudited)
| | |
Successor | |
| | |
Three
Months Ended | |
| | |
September 30,
2026 | | |
June
30,
2026 | |
| Calculation of gross profit: | |
| | |
| |
| Revenues | |
$ | 142,005 | | |
$ | 141,806 | |
| Cost
of revenues (exclusive of depreciation and amortization shown separately
below) | |
| 121,432 | | |
| 121,866 | |
| Depreciation (related to cost
of revenues) | |
| 7,100 | | |
| 6,901 | |
| Amortization of intangibles | |
| 205 | | |
| 205 | |
| Gross
profit | |
$ | 13,268 | | |
$ | 12,834 | |
| | |
| | | |
| | |
| Adjusted
gross profit reconciliation: | |
| | | |
| | |
| Gross profit | |
$ | 13,268 | | |
$ | 12,834 | |
| Depreciation (related to cost
of revenues) | |
| 7,100 | | |
| 6,901 | |
| Amortization of intangibles | |
| 205 | | |
| 205 | |
| Adjusted
gross profit | |
$ | 20,573 | | |
$ | 19,940 | |
| A | Adjusted
EBITDA is defined as EBITDA (which is net income (loss) before interest, taxes, and depreciation
and amortization) further adjusted for (i) goodwill, intangible asset, and/or property and
equipment impairment charges, (ii) transaction and integration costs related to acquisitions,
(iii) loss or gain on revaluation of contingent liabilities, (iv) loss or gain on the extinguishment
of debt, (v) loss or gain on the sale of subsidiaries, (vi) restructuring charges, (vii)
stock-based compensation and certain cash award expense, (viii) loss or gain on sale of property
and equipment, and (ix) other expenses or charges to exclude certain items which we believe
are not reflective of ongoing performance of our business, such as legal expenses and settlement
costs related to litigation outside the ordinary course of business. Management believes
adjusted EBITDA provides useful information to us and our investors regarding our financial
condition and results of operations because it allows us and them to more effectively evaluate
our operating performance and compare the results of our operations from period to period
without regard to our financing methods or capital structure and helps identify underlying
trends in our operations that could otherwise be distorted by the effect of impairments,
acquisitions and dispositions and costs that are not reflective of the ongoing performance
of our business. |
| | |
| B | Adjusted
gross profit (loss) is defined as revenues less cost of revenues excluding depreciation and
amortization. This measure differs from the GAAP definition of gross profit (loss) because
we do not include the impact of depreciation and amortization, which represent non-cash expenses.
Management believes adjusted gross profit (loss) provides useful information to us and our
investors regarding our financial condition and results of operation and helps management
evaluate our operating performance by eliminating the impact of depreciation and amortization,
which we do not consider indicative of our core operating performance. |
9
