Cactus, Inc. (NYSE: WHD) reported Q4 EPS of $0.08, $0.02 better than the analyst estimate of $0.06. Revenue for the quarter came in at $68.1 million versus the consensus estimate of $68.23 million.

Fourth Quarter 2020 Highlights

• Revenue of $68.1 million;
• Income from operations of $8.4 million;
• Net income of $6.1 million(1) and diluted earnings per Class A share of $0.07(1);
• Net income, as adjusted(2) of $6.3 million and diluted earnings per share, as adjusted(2) of $0.08;
• Adjusted EBITDA(3) and related margin(4) of $19.8 million and 29.1%, respectively;
• Cash flow from operations of $21.9 million;
• Cash balance of $288.7 million and no bank debt outstanding as of December 31, 2020; and
• In January 2021, the Board of Directors declared a quarterly cash dividend of $0.09 per share.

Scott Bender, President and CEO of Cactus, commented, “Our industry-leading technology and continued ability to execute placed Cactus in an excellent position to capitalize on the cyclical market recovery that is now underway. As such, Cactus achieved record Product market share(1) during the fourth quarter, as we supplied wellhead equipment for approximately 43% of the U.S. land rigs in operation. Full year and fourth quarter 2020 results highlighted our ability to generate substantial free cash flow and maintain strong margins even in challenging markets.

“Looking to the first quarter of 2021, we expect further gains in rigs followed will benefit our Product business. Additionally, we have witnessed meaningful sequential growth in Rental activity to start the year as customers return to higher-end suppliers with a focus on safety and technology. We expect double digit revenue growth on a percentage basis across all our business lines sequentially during the first quarter, even when accounting for the impact of the adverse weather witnessed in recent weeks.

“In addition to the increased activity witnessed during the fourth quarter, there are a number of positive developments unfolding for Cactus. The macroeconomic environment and associated demand for our products and services is clearly improving in the U.S., as noted by our early 2021 outlook. On the R&D front, we are currently in the late stages of developing technologies specifically designed to reduce the environmental impact of flow control equipment and assist our customers in realizing their ESG-related goals. Additionally, we made our first shipments of equipment to the Middle East in January 2021, which should provide opportunities for growth in the region this year.”

Mr. Bender concluded, “Our performance and recent developments provide grounds for optimism about the trajectory of the business. As always, we will operate with a focus on margins, returns, and creating value for our shareholders.”

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