ProFrac Holding Corp
For the period ended Sep 30, 2024. Filed Nov 6, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2024 · Filed Nov 6, 2024
ACDC$3.01+10.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-09.
0000950170-24-094812
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-11-06.
0000950170-24-122270
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 89 previous paragraphs and 92 current paragraphs.
54 unchanged; 34 reworded; 4 added; 1 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (4)
Current report
Other. Other cost of revenues for the three months ended September 30, 2024 increased by $1.6 million, or 4%, from the same period in 2023. Other cost of revenues for the nine months ended September 30, 2024 decreased by $24.0 million, or 18%, from the same period in 2023. These decreases were primarily attributable to decreased product sales and lower freight costs.
Current report
In 2024, we experienced a decline in our operating results for our Permian Proppant reporting unit and our Eagle Ford Proppant reporting unit. In the third quarter of 2024, we noted that our operating results for these reporting units were not expected to significantly recover in the short-term. The reduced operating results for these reporting units resulted in triggering events and, accordingly, we performed interim quantitative impairment tests in the third quarter of 2024. Based upon the results of our interim quantitative impairment tests, we concluded that the carrying values of the Permian Proppant and Eagle Ford Proppant reporting units exceeded their estimated fair values, which resulted in goodwill impairment charges of $2.4 million and $4.4 million, respectively, for the three and nine months ended September 30, 2024, which represented all of the goodwill recorded on these reporting units.
Current report
The transaction costs for the three and nine months ended September 30, 2024, represent deferred costs incurred for Alpine's initial public offering that were charged to earnings as a result of its postponement.
Current report
Supply commitment charges for the three and nine months ended September 30, 2024, represent charges related to contractual inventory purchase commitments to certain proppant suppliers. These charges were attributable to our decreased volume of purchases from these suppliers due to certain customers decreasing their activity levels. If future customer demand differs from our contracted supply, we may incur supply commitment charges in future periods.
Removed paragraphs (1)
Previous report
Other. Other cost of revenues for the three and six months ended June 30, 2024 decreased by $11.9 million and $25.6 million, or 24% and 27%, respectively, from the same periods in 2023. This decrease was primarily attributable to decreased product sales and lower freight costs, partially offset by increased tank rental and maintenance costs.
Reworded paragraphs (34)
Previous wording
We operate in three reportable business segments: stimulation services, proppant production and manufacturing. Our stimulation services segment owns and operates a fleet of mobile hydraulic fracturing units and other auxiliary equipment that generates revenue by providing stimulation services to our customers. Our proppant production segment provides proppant to oilfield service providers and E&P companies. Our manufacturing segment sells products such as high horsepower pumps, valves, piping, swivels, large-bore manifold systems, and fluid ends.
Current wording
We operate in three reportable business segments: stimulation services, proppant production and manufacturing. Our stimulation services segment, which primarily relates to ProFrac LLC, owns and operates a fleet of mobile hydraulic fracturing units and other auxiliary equipment that generates revenue by providing stimulation services to our customers. Our proppant production segment, which primarily relates to Alpine, provides proppant to oilfield service providers and E&P companies. Our manufacturing segment sells products such as high horsepower pumps, valves, piping, swivels, large-bore manifold systems, and fluid ends.
Previous wording
Total revenue for the three and six months ended June 30, 2024, was $579.4 million and $1,160.9 million, respectively, which represented a decrease of $129.8 million and $405.8 million from the same periods in 2023.
Current wording
Total revenue for the three and nine months ended September 30, 2024, was $575.3 million and $1,736.2 million, respectively, which represented an increase of $1.1 million and a decrease of $404.7 million from the same periods in 2023.
Previous wording
Net loss attributable to ProFrac Holding Corp. for the three and six months ended June 30, 2024, was $66.7 million and $64.9 million, respectively, which represented a decrease of $63.8 million and $84.0 million from the same periods in 2023. The net losses in 2024 included a pretax goodwill impairment charge of $67.7 million.
Current wording
Net loss attributable to ProFrac Holding Corp. for the three and nine months ended September 30, 2024, was $45.2 million and $110.1 million, respectively, which represented decreases of $26.3 million and $110.3 million from the same periods in 2023. The net losses for the three and nine months ended September 30, 2024 included pretax goodwill impairment charges of $6.8 million and $74.5 million, respectively.
Previous wording
Cash provided by operating activities for the six months ended June 30, 2024, was $192.6 million, a decrease of $194.6 million from the same period in 2023.
Current wording
Cash provided by operating activities for the nine months ended September 30, 2024, was $290.8 million, a decrease of $220.0 million from the same period in 2023.
Previous wording
Total principal amount of long-term debt was $1,234.4 million at June 30, 2024, an increase of $126.5 million from December 31, 2023.
Current wording
Total principal amount of long-term debt was $1,205.7 million at September 30, 2024, an increase of $97.8 million from December 31, 2023.
Previous wording
Stimulation Services. Stimulation services revenues for the three and six months ended June 30, 2024 decreased $102.6 million and $375.5 million, or 17% and 27%, respectively, from the same periods in 2023. These decreases were primarily attributable to a lower number of average active fleets in 2024, lower average pricing for our services, and an increase in the portion of customers who provided their own proppant and chemistry. These decreases were partially offset by increased utilization of our active fleets in 2024.
Current wording
Stimulation Services. Stimulation services revenues for the three months ended September 30, 2024 increased $17.6 million, or 4%, from the same period in 2023. This increase was primarily attributable to an increase in average fleets and higher fleet utilization. Additionally, the acquisition of AST contributed revenue starting in June 2024. This increase was partially offset by lower average pricing for our services and an increase in the portion of customers who provided their own proppant and chemistry. Stimulation services revenues for the nine months ended September 30, 2024 decreased $357.9 million, or 19%, from the same period in 2023. This decrease was primarily attributable to a lower number of average active fleets in 2024, lower average pricing for our services, and an increase in the portion of customers who provided their own proppant and chemistry. These decreases were partially offset by increased utilization of our active fleets in 2024.
Previous wording
Proppant Production. Proppant production revenues for the three and six months ended June 30, 2024 decreased $40.3 million and $44.8 million, or 37% and 23%, respectively, from the same periods in 2023. These decreases were attributable to lower average prices for products sold and a reduction in volumes sold. Additionally, the acquisition of Performance Proppants contributed revenue starting in February 2023. Revenue recognized for the amortization of acquired off-market contracts for the three and six months ended June 30, 2024 was $10.9 and $27.4 million, respectively, compared to $16.5 million and $24.6 million, respectively, in the same periods in 2023. Refer to Item 8 "Financial Statements and Supplementary Data" in our Annual Report for information about our acquired contract liabilities. During the three and six months ended June 30, 2024, approximately 23% and 27%, respectively, of the Proppant Production segment's revenues were intercompany, compared with 31% and 32% in the same periods in 2023.
Current wording
Proppant Production. Proppant production revenues for the three and nine months ended September 30, 2024 decreased $45.6 million and $90.4 million, or 46% and 31%, respectively, from the same periods in 2023. These decreases were attributable to lower average prices for products sold and a reduction in volumes sold. Additionally, the acquisition of Performance Proppants contributed revenue starting in February 2023. Revenue recognized for the amortization of acquired off-market contracts for the three and nine months ended September 30, 2024 was $8.9 million and $36.1 million, respectively, compared to $16.4 million and $41.0 million, respectively, in the same periods in 2023. Refer to Item 8 "Financial Statements and Supplementary Data" in our Annual Report for information about our acquired contract liabilities. During the three and nine months ended September 30, 2024, approximately 24% and 26%, respectively, of the Proppant Production segment's revenues were intercompany, compared with 29% and 31% in the same periods in 2023.
Previous wording
Manufacturing. Manufacturing revenues for the three and six months ended June 30, 2024 increased by $24.8 million and $1.2 million, or 80% and 1%, respectively, from the same periods in 2023. This increase was attributable to higher intercompany demand for manufacturing products due to our higher average active fleets in 2024. During the three and six months ended June 30, 2024, approximately 74% and 76%, respectively, of the Manufacturing segment's revenues were intercompany, compared with 73% and 88% in the same periods in 2023.
Current wording
Manufacturing. Manufacturing revenues for the three and nine months ended September 30, 2024 increased by $17.7 million and $18.9 million, or 40% and 13%, respectively, from the same periods in 2023. This increase was attributable to higher intercompany demand for manufacturing products in the third quarter of 2024. Additionally, the acquisition of BPC and NRG contributed revenue starting in April 2024 and June 2024, respectively. During the three and nine months ended September 30, 2024, approximately 80% and 77%, respectively, of the Manufacturing segment's revenues were intercompany, compared with 97% and 91% in the same periods in 2023.
Previous wording
Other. Other revenues for the three and six months ended June 30, 2024 decreased by $4.1 million and $11.6 million, respectively, from the same periods in 2023. This decrease was primarily attributable to lower intercompany demand for chemistry products, which was partially offset by increased revenue from external customers. Flotek recorded contract shortfall revenue of $8.4 million and $2.0 million for the three months ended June 30, 2024 and 2023, respectively, and $17.1 million and $2.0 million for the six months ended June 30, 2024 and 2023, respectively, because the stimulation services segment did not purchase the minimum contractual commitment of chemistry products from Flotek. During the three and six months ended June 30, 2024, approximately 62% and 65%, respectively, of other revenues were intercompany, compared with 66% and 71% in the same periods in 2023.
Current wording
Other. Other revenues for the three months ended September 30, 2024 increased by $2.7 million from the same period in 2023. This increase was primarily attributable to higher intercompany revenue at Flotek, which was partially offset by decreased revenue from external customers. Other revenues for the nine months ended September 30, 2024 decreased by $8.9 million from the same period in 2023. This decrease was primarily attributable to lower intercompany revenue at Flotek. Flotek recorded contract shortfall revenue of $6.7 million and $8.0 million for the three months ended September 30, 2024 and 2023, respectively, and $23.8 million and $10.0 million for the nine months ended September 30, 2024 and 2023, respectively, because ProFrac LLC did not purchase the minimum contractual commitment of chemistry products from Flotek. During the three and nine months ended September 30, 2024, approximately 68% and 66%, respectively, of other revenues were intercompany, compared with 63% and 68% in the same periods in 2023.
Previous wording
Stimulation Services. Stimulation services cost of revenues for the three and six months ended June 30, 2024 decreased by $78.6 million and $261.9 million, or 18% and 26%, respectively, from the same period in 2023. This decrease was primarily attributable to a decrease in average active fleets and decreased volume of fracturing materials in 2024. Cost of revenues for this segment included intercompany supply commitment charges of $8.4 million and $2.0 million for the three months ended June 30, 2024 and 2023, respectively, and $17.1 million and $2.0 million for the six months ended June 30, 2024 and 2023, respectively, because the stimulation services segment did not purchase the minimum contractual commitment of chemistry products from Flotek.
Current wording
Stimulation Services. Stimulation services cost of revenues for the three months ended September 30, 2024 was consistent with the same period in 2023. Stimulation services cost of revenues for the nine months ended September 30, 2024 decreased by $262.5 million, or 19%, from the same period in 2023. This decrease was primarily attributable to a decrease in average active fleets and decreased volume of proppant and chemistry in 2024. Cost of revenues for this segment included intercompany supply commitment charges of $6.7 million and $8.0 million for the three months ended September 30, 2024 and 2023, respectively, and $23.8 million and $10.0 million for the nine months ended September 30, 2024 and 2023, respectively, because ProFrac LLC did not purchase the minimum contractual commitment of chemistry products from Flotek.
Previous wording
Proppant Production. Proppant production cost of revenues for the three and six months ended June 30, 2024 decreased by $10.4 million and $6.5 million, or 22% and 8%, respectively, from the same period in 2023. This reduction was primarily attributable to lower volumes sold in 2024. Additionally, the acquisition of Performance Proppants contributed costs beginning in February 2023.
Current wording
Proppant Production. Proppant production cost of revenues for the three and nine months ended September 30, 2024 decreased by $11.3 million and $17.8 million, or 27% and 14%, respectively, from the same periods in 2023. This reduction was primarily attributable to lower volumes sold in 2024. Additionally, the acquisition of Performance Proppants contributed costs beginning in February 2023.
Previous wording
Manufacturing. Manufacturing cost of revenues for the three and six months ended June 30, 2024 increased by $25.2 and $3.9 million, or 106% and 5%, respectively, from the same period in 2023. This increase was primarily attributable to higher volumes of products sold in 2024.
Current wording
Manufacturing. Manufacturing cost of revenues for the three and nine months ended September 30, 2024 increased by $15.6 million and $19.5 million, or 40% and 17%, respectively, from the same period in 2023. This increase was primarily attributable to higher volumes of products sold to intercompany and third-party customers in 2024. Additionally, the acquisition of BPC and NRG contributed costs beginning in April 2024 and June 2024, respectively.
Previous wording
Selling, general and administrative expenses, excluding stock-based compensation for the three and six months ended June 30, 2024, decreased by $2.5 million and $10.7 million, or 5% and 10%, respectively, from the same periods in 2023.
Current wording
Selling, general and administrative expenses, excluding stock-based compensation for the three months ended September 30, 2024 increased $2.6 million, or 5%, from the same period in 2023. Selling, general and administrative expenses, excluding stock-based compensation for the nine months ended September 30, 2024 decreased $8.1 million, or 5%, from the same period in 2023.
Previous wording
Depreciation, depletion, and amortization for the three and six months ended June 30, 2024 was $103.4 million and $216.2 million, respectively, which was consistent with $108.9 million and $219.2 million in the same periods in 2023.
Current wording
Depreciation, depletion, and amortization for the three and nine months ended September 30, 2024 was $112.7 million and $328.9 million, respectively, which was consistent with $111.5 million and $330.7 million in the same periods in 2023.
Previous wording
Acquisition and integration costs primarily relate to professional fees, severance and other costs associated with our acquisition and integration activities. For the three and six months ended June 30, 2024, these costs were $2.9 million and $3.1 million, respectively, compared with $5.2 million and $17.5 million in the same periods in 2023.
Current wording
Acquisition and integration costs primarily relate to professional fees, severance and other costs associated with our acquisition and integration activities. For the three and nine months ended September 30, 2024, these costs were $2.0 million and $5.1 million, respectively, compared with $2.6 million and $20.1 million in the same periods in 2023.
Previous wording
In 2024 a decline in natural gas prices reduced our customers’ activity levels in the Haynesville basin, which is heavily concentrated with natural gas wells. This activity downturn has significantly reduced the operating results of our Haynesville Proppant reporting unit. In the second quarter of 2024, we noted that our customers’ activity levels were not expected to significantly recover in the short-term. The reduced operating results of our Haynesville Proppant reporting unit therefore resulted in a triggering event and, accordingly, we performed an interim quantitative impairment test in the second quarter of 2024. Based upon the results of our interim quantitative impairment test, we concluded that the carrying value of the Haynesville Proppant reporting unit exceeded its estimated fair value, which resulted in a goodwill impairment charge of $67.7 million for the three and six months ended June 30, 2024. This goodwill impairment charge represented all of the goodwill recorded on the Haynesville Proppant reporting unit. If overall market conditions deteriorate, or if we are unable to achieve our forecasted results, future non-cash impairment charges may result in other reporting units which could be material.
Current wording
In 2024, a decline in natural gas prices reduced our customers’ activity levels in the Haynesville basin, which is heavily concentrated with natural gas wells. This activity downturn has significantly reduced the operating results of our Haynesville Proppant reporting unit. In the second quarter of 2024, we noted that our customers’ activity levels were not expected to significantly recover in the short-term. The reduced operating results of our Haynesville Proppant reporting unit therefore resulted in a triggering event and, accordingly, we performed an interim quantitative impairment test in the second quarter of 2024. Based upon the results of our interim quantitative impairment test, we concluded that the carrying value of the Haynesville Proppant reporting unit exceeded its estimated fair value, which resulted in a goodwill impairment charge of $67.7 million for the three months ended September 30, 2024. This goodwill impairment charge represented all of the goodwill recorded on the Haynesville Proppant reporting unit. If overall market conditions deteriorate, or if we are unable to achieve our forecasted results, future non-cash impairment charges may result in other reporting units which could be material.
Previous wording
Litigation expenses and accruals for legal contingencies generally represent legal and professional fees incurred in litigation as well as estimates for loss contingencies with regards to certain vendor disputes and litigation matters. In the periods presented, substantially all of these costs represent litigation costs incurred in connection with a patent infringement lawsuit against Halliburton. See "Note 9. Commitments and Contingencies" for a discussion of significant litigation matters.
Current wording
Litigation expenses and accruals for legal contingencies generally represent legal and professional fees incurred in litigation as well as estimates for loss contingencies with regards to certain vendor disputes and litigation matters. In the periods presented, substantially all of these costs represent litigation costs incurred in connection with certain patent infringement lawsuits with Halliburton, which were settled in September 2024. See "Note 9. Commitments and Contingencies" for a discussion of significant litigation matters.
Previous wording
Severance charges for the three and six months ended June 30, 2024 relate to the departure of executives.
Current wording
Severance charges for the three and nine months ended September 30, 2024 relate to the departure of certain highly-compensated employees.
Previous wording
The acquisition earnout adjustment for the three and six months ended June 30, 2023 represents a decrease in the fair value of the contingent consideration related to our acquisition of REV in December 2022.
Current wording
The acquisition earnout adjustment for the nine months ended September 30, 2023 represents a decrease in the fair value of the contingent consideration related to our acquisition of REV in December 2022.
Previous wording
Interest expense, net of interest income, for the three and six months ended June 30, 2024 was $39.6 million and $77.2 million, respectively, which was consistent with $41.0 million and $75.9 million in the same periods in 2023.
Current wording
Interest expense, net of interest income, for the three and nine months ended September 30, 2024 was $40.6 million and $117.8 million, respectively, which was consistent with $40.2 million and $116.1 million in the same periods in 2023.
Previous wording
For the six months ended June 30, 2023, we recognized a net gain of $4.1 million, which was primarily due to the forgiveness of Flotek's Paycheck Protection Program loan in the first quarter of 2023.
Current wording
For the nine months ended September 30, 2023, we recognized a net gain of $4.1 million, which was primarily due to the forgiveness of Flotek's Paycheck Protection Program loan in the first quarter of 2023.
Previous wording
For the three and six months ended June 30, 2024 we recognized a loss of $0.5 million and a gain of $1.3 million, respectively, compared with a loss of $7.7 million and $17.1 million in the same periods in 2023. The 2023 loss was primarily attributable to a decrease in the fair value of our investment in BPC and the change in fair value of our Munger make-whole provision.
Current wording
For the three and nine months ended September 30, 2024 we recognized a loss of $0.1 million and a gain of $1.2 million, respectively, compared with a loss of $4.9 million and $22.0 million in the same periods in 2023. The 2023 loss was primarily attributable to a decrease in the fair value of our investment in BPC and the change in fair value of our Munger make-whole provision.
Previous wording
Income taxes were a benefit of $23.4 million and an expense of $16.3 million for the six months ended June 30, 2024 and 2023, respectively. Our effective tax rate for the six months ended June 30, 2024 was 27.2%, compared with 22.8% in the same period in 2023.
Current wording
Income taxes were a benefit of $24.9 million and an expense of $9.6 million for the nine months ended September 30, 2024 and 2023, respectively. Our effective tax rate for the nine months ended September 30, 2024 was 19.0%, compared with 20.5% in the same period in 2023.
Previous wording
For the three and six months ended June 30, 2024, our income tax provision included a discrete benefit of $27.4 million related to the release of a portion of the valuation allowance on our net deferred tax assets. This discrete item was caused by the assumption of a $27.4 million deferred tax liability in our acquisition of AST, which made it more likely than not that we would be able to utilize a corresponding amount of our deferred tax assets. Excluding this discrete item, the difference between our effective tax rate and the federal statutory rate related to changes in the valuation allowance on our net deferred tax assets.
Current wording
For the nine months ended September 30, 2024, our income tax provision included a discrete benefit of $25.6 million related to the release of a portion of the valuation allowance on our net deferred tax assets. This discrete item was caused by the assumption of a $25.6 million net deferred tax liability in our acquisition of AST, which made it more likely than not that we would be able to utilize a corresponding amount of our deferred tax assets. Excluding this discrete item, the difference between our effective tax rate and the federal statutory rate related to changes in the valuation allowance on our net deferred tax assets.
Previous wording
At June 30, 2024, we had $19.2 million of cash and cash equivalents, excluding Flotek, and $142.0 million available for borrowings under our revolving credit facility, which resulted in a total liquidity position of $161.2 million. Refer to our Annual Report for more information regarding our revolving credit facility.
Current wording
At September 30, 2024, we had $20.5 million of cash and cash equivalents, excluding Flotek, and $88.7 million available for borrowings under our revolving credit facility, which resulted in a total liquidity position of $109.2 million. Refer to our Annual Report for more information regarding our revolving credit facility.
Previous wording
Operating Activities. Net cash provided by operating activities was $192.6 million and $387.2 million for the six months ended June 30, 2024 and 2023, respectively. Cash flows from operating activities consist of net income or loss adjusted for non-cash items and changes in net working capital. Net income or loss adjusted for non-cash items for the six months ended June 30, 2024 resulted in a cash increase of $175.6 million compared with a cash increase of $295.0 million in the same period of 2023. This change was primarily due to lower earnings in 2024. Changes in net working capital for the six months ended June 30, 2024 resulted in a cash increase of $17.0 million compared with a cash increase of $92.2 million in the same period of 2023. This change was primarily due to decreased cash from accounts receivable and accounts payable in 2024, which was partially offset by increased cash provided by inventories in 2024.
Current wording
Operating Activities. Net cash provided by operating activities was $290.8 million and $510.8 million for the nine months ended September 30, 2024 and 2023, respectively. Cash flows from operating activities consist of net income or loss adjusted for non-cash items and changes in net working capital. Net income or loss adjusted for non-cash items for the nine months ended September 30, 2024 resulted in a cash increase of $255.6 million compared with a cash increase of $391.3 million in the same period of 2023. This change was primarily due to lower earnings in 2024. Changes in net working capital for the nine months ended September 30, 2024 resulted in a cash increase of $35.2 million compared with a cash increase of $119.5 million in the same period of 2023. This change was primarily due to decreased cash from accounts receivable in 2024, which was partially offset by increased cash provided by inventories and accounts payable in 2024.
Previous wording
Investing Activities. Net cash used in investing activities was $284.8 million and $636.4 million for the six months ended June 30, 2024 and 2023, respectively. This change was primarily due to decreased cash used for acquisitions and capital expenditures in 2024.
Current wording
Investing Activities. Net cash used in investing activities was $351.8 million and $687.4 million for the nine months ended September 30, 2024 and 2023, respectively. This change was primarily due to decreased cash used for acquisitions and capital expenditures in 2024.
Previous wording
Financing Activities. Net cash provided in financing activities was $90.9 million and $239.1 million for the six months ended June 30, 2024 and 2023, respectively. Net cash provided in 2024 and 2023 was primarily attributable to borrowings to fund our acquisition of AST and Performance Proppants, respectively, and utilization of our revolving credit facility for general corporate purposes.
Current wording
Financing Activities. Net cash provided in financing activities was $61.2 million and $164.5 million for the nine months ended September 30, 2024 and 2023, respectively. Net cash provided in 2024 and 2023 was primarily attributable to borrowings to fund acquisitions and utilization of our revolving credit facility for general corporate purposes. Additionally, in 2023 we received net proceeds of $48.9 million from the issuance of Preferred Stock.
Previous wording
As of June 30, 2024 we have $1,234.4 million in aggregate principal amount of long-term debt outstanding, with $174.4 million coming due over the next twelve months. For additional information about our long-term debt, see "Note 4. Debt" in the notes to our unaudited condensed consolidated financial statements and Item 8 "Financial Statements and Supplementary Data" in our Annual Report.
Current wording
As of September 30, 2024 we have $1,205.7 million in aggregate principal amount of long-term debt outstanding, with $171.9 million coming due over the next twelve months. For additional information about our long-term debt, see "Note 4. Debt" in the notes to our unaudited condensed consolidated financial statements and Item 8 "Financial Statements and Supplementary Data" in our Annual Report.
Previous wording
The Alpine 2023 Term Loan originally contained a covenant commencing with the fiscal quarter ending September 30, 2024, requiring Alpine not to exceed a maximum Total Net Leverage Ratio (as defined in the Alpine Term Loan Credit Agreement) of 2.00 to 1.00. This ratio is generally the consolidated total debt of Alpine divided by Alpine's adjusted EBITDA. In the second quarter of 2024, this covenant was amended to commence testing compliance with the Total Net Leverage Ratio with the fiscal quarter ending on September 30, 2025. Alpine is closely monitoring compliance with this future covenant.
Current wording
The Alpine 2023 Term Loan originally contained a covenant commencing with the fiscal quarter ending September 30, 2024, requiring Alpine not to exceed a maximum Total Net Leverage Ratio (as defined in the Alpine Term Loan Credit Agreement) of 2.00 to 1.00. This ratio is generally the consolidated total debt of Alpine divided by Alpine's adjusted EBITDA. In the second quarter of 2024, this covenant was amended to commence testing compliance with the Total Net Leverage Ratio with the fiscal quarter ending on September 30, 2025. As a result of Alpine’s lower than expected operating results in 2024, Alpine is closely monitoring its forthcoming compliance obligation with this covenant. While there can be no assurance, Alpine believes that it will be able to meet, modify, or further defer this debt covenant.
Previous wording
During the six months ended June 30, 2024 our capital expenditures were $121.8 million, consisting of maintenance capital expenditures for our hydraulic fracturing fleet, upgrades to legacy pumps, expenditures to maintain efficient operations at our sand mines, and investments in next generation technology.
Current wording
During the nine months ended September 30, 2024 our capital expenditures were $191.8 million, consisting of maintenance capital expenditures for our hydraulic fracturing fleet, upgrades to legacy pumps, expenditures to maintain efficient operations at our sand mines, and investments in next generation technology.
Previous wording
As of June 30, 2024, we had purchase commitments of $32.2 million in 2024 and $44.7 million in 2025 for minimum sand commitments and hydraulic fracturing equipment components.
Current wording
As of September 30, 2024, we had purchase commitments of $5.4 million in 2024 and $55.8 million in 2025 for minimum sand commitments and hydraulic fracturing equipment components.
Previous wording
As of June 30, 2024 we have $71.2 million of estimated tax receivable agreement obligations, with an estimated $6.4 million coming due over the next twelve months. This obligation will generally be paid under the tax receivable agreement as the Company realizes actual cash tax savings from the tax benefits covered by the tax receivable agreement in future tax years. We do not expect a significant increase in the estimate of this liability in future periods. For additional information about our tax receivable agreement, please see Item 8 "Financial Statements and Supplementary Data" in our Annual Report.
Current wording
As of September 30, 2024 we have $71.3 million of estimated tax receivable agreement obligations, with an estimated $3.2 million coming due over the next twelve months. This obligation will generally be paid under the tax receivable agreement as the Company realizes actual cash tax savings from the tax benefits covered by the tax receivable agreement in future tax years. We do not expect a significant increase in the estimate of this liability in future periods. For additional information about our tax receivable agreement, please see Item 8 "Financial Statements and Supplementary Data" in our Annual Report.
Previous wording
We are currently litigating multiple patent infringement lawsuits against Halliburton. The outcomes of these cases are uncertain and the ultimate resolution of them could have a material adverse effect on our liquidity in the periods in which these matters are resolved. See “Note 9. Commitments and Contingencies” in the notes to our unaudited condensed consolidated financial statements for further discussion.
Current wording
Prior to September 2024, we were litigating multiple patent infringement lawsuits against Halliburton. In September 2024, we settled these lawsuits with Halliburton for a confidential amount and the financial effects of this matter have been included in our consolidated financial statements as of September 30, 2024. See “Note 9. Commitments and Contingencies” in the notes to our unaudited condensed consolidated financial statements for further discussion.