The following is a summary of the Natural Gas Services Group, Inc. (NGS) Q4 2023 Earnings Call Transcript:

Financial Performance:

• Natural Gas Services Group reported Q4 revenue of $36.2 million, a 61% increase from the previous year.

• The full-year revenue also saw a 43% increase to $121.2 million from the preceding year.

• The adjusted total gross margin for Q4 2023 was $20.3 million, an 89% increase compared to the same period in 2022.

• Rental revenue saw a significant hike too, with a 54% increase YoY.

• The net income for 2023 stood at $4.7 million, paving a strong road of recovery from the net loss in the previous year.

Business Progress:

• The company expanded its fleet size with the addition of nearly 95,000 net horsepower in the past year, representing a 22% increase in the total fleet horsepower.

• The company is expected to further invest to improve scalability and efficiency.

• For 2024, capital expenditure is expected in the range of $40-$50 million, targeting at least a 20% return on the capital.

• The company plans to grow its rental fleet mainly through precontracted customer agreements, and potential opportunities with rental compression companies.

• The large focus would be on natural gas compressors for unconventional oil production while maintaining a strong portfolio of medium horsepower units.

• The company is looking into the options of introducing dividends as part of its capital allocation strategy.

More details: Natural Gas Services IR

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