Q1 2021 Solaris Oilfield Infrastructure Inc Earnings Call
[music].
Good day and welcome to the Solaris first quarter 2021 earnings teleconference and webcast all.
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Please note. This event is being recorded I would like to turn the conference over to Yvonne Fletcher Senior Vice President of Finance Investor Relations. Please go ahead.
Good morning, and welcome to the Solaris first quarter 2021 earnings Conference call I'm joined today by our chairman and CEO of bills, Arthur and our President and CFO Kyle Ramachandran before we begin I'd like to remind you of our standard cautionary remarks regarding the forward looking nature of some of the statements that we will make today.
Such forward looking statements may include comments regarding future financial results and reflect the number of known and unknown risks.
Please refer to our press release issued yesterday, along with other recent public filings with the Securities and Exchange Commission that outline those risks.
I would also like to point out that our earnings release and today's conference call will contain discussion of non-GAAP financial measures, which we believe can be useful in evaluating our performance. The presentation of this additional information should not be considered in isolation or as a substitute for the results prepared in accordance with GAAP.
<unk> to comparable GAAP measures are available on our earnings release, which is posted on our website at Solaris oilfield Dot com under the news section I'll now turn the call over to our chairman and CEO of Phil's earlier.
Thank you you've on and thank you everyone for joining us today I'm pleased to share another quarter of strong Soliris results with you today during the first quarter of 2021, Solaris generated a 13% sequential increase in revenue to nearly $29 million generated an adjusted EBITDA increased 26% sequentially to over six.
We paid our 10th consecutive quarterly dividend, we ended the quarter with $55 million of cash and no debt on the balance sheet the.
The first quarter of 2021 showed continued economic and industry progress as oil demand continue to recover against the backdrop of disciplined U S and global supply this improving outlook steadily drove oil prices back to the $60 a barrel range during the first quarter and prices have remained relatively stable in the $60 range. So far.
The second quarter natural gas prices have also remained steady in the $2 50 to $3 range. As a result, we saw a continued increase in both completions and rig count activity. The drove an increase in activity for Solaris as well.
Our system count was up 24% sequentially in the first quarter, which reflected a stronger and quicker recovery than we anticipated many operators ramped up activity earlier in the quarter and have remained disciplined in the study looking into the second quarter given the early surge we saw on activity during the first quarter, we expect of flattish activity level for Soliris in the second.
Quarter.
Our customers continue to focus on finding efficiency gains we spoke about the simulcast <unk> on last quarter's call and that continues to be of technique. Most operators with sizable programs are trying because some of the fracs driving increased completion rates for the delivery and management of raw materials on location require technologies that can meet the demand for logistics and footprint requirements.
To ensure that cost savings from the time of Frac operations are actually realized.
Last quarter, we introduced our latest disruptive innovation, which is the patent pending technology that extends our traditional equipment from of storage solution to the high grade of delivery system and replaces the traditional blender our automated all electric design eliminates many of the traditional blender points of failure and frees up the both head count and space on location to continue driving.
Costs down for our customers.
When used in conjunction with their automated sand water and chemical systems, we eliminate multiple steps from the traditional process. We believe we can reduce personnel on location by up to 80 per cent, providing significant savings and safety improvements. In addition to our new blending system development. We spent the last few years, developing and testing new safety and dose control enhancement.
As for our equipment.
These improvements include auto Hopper belt scale of dust collection and equipment and closures.
Intimate way, we believe of automation and remote operation are the two of the best ways to improve well site safety inefficiencies.
The elimination of personnel saves labor cost reduces the potential for silica exposure and lowers the risk of other safety incidents.
In March we hosted a technology open house, where we demonstrated our full equipment offering and ran simulated operations, including on our new blending technology water silos and chemical systems. The response was overwhelmingly positive and we received interest from multiple parties on Trialing the full offering.
The same Solaris Solaris the storage capabilities in person provided the visual contacts for the benefits of vertical fluid storage. This has led to several requests from customers and we've already completed conversions of the older idle sand silo systems, resulting in five water systems currently in our fleet and deployed with customers.
We see incremental growth beyond this and are in the process of converting additional sand silo systems in the water systems and we expect to be on our first well site trial of our blending technology in the second quarter, It's still too early to know what the ultimate market will be for these new offerings. As we are just beginning our first jobs, but we are excited about the opportunity to continue the efficiency push.
For our customers by creating built for purpose innovative solutions.
On the sustainability of front, we recently provided the support for wind energy company at our Kingfisher Trans load facility for the transport and staging of wind power installations in Oklahoma.
All of the opportunity is small today wind projects currently accounts for over a third of the power under construction in Oklahoma and we're pleased to be able to support the effort with our state of the art facility.
Our primary ESG goals will continue to focus on lowering the cost of carbon footprint of the benefit of our customers and the communities. We operate in but we will always consider ways to support the energy transition. If it also allows us to put our capital to work at attractive incremental returns on it.
I will turn it over to Kyle for more detailed financial review.
Thanks, Bill to recap some of the numbers during the first quarter, we generated nearly $20 million $29 million of revenue adjusted EBITDA of over $6 million and modestly positive free cash flow. We averaged 52 fully utilized systems deployed the customers, which represent the 24% sequential increase total revenue increase.
The 13% sequentially driven by an increase in activity as well as an increase in last mile services. The profitability was modestly offset by the winter storms that impacted the most of the Texas based operations in February.
Absent the impact of the storm on profitability on a per system basis would've been closer to fourth quarter 2020 levels.
Over the course of the quarter, we deployed a total of 83 proppant systems, which worked with varying degrees of utilization in the first quarter. Our calculation of 52 fully utilized systems reflects the number of equivalent systems that generated revenue every day in the quarter, which we believe is the best measured from modeling purposes.
Operating cash flow was approximately $2 8 million and was impacted by seasonal first quarter working capital cash requirements. In addition to a buildup in accounts receivable as activity increased net of capital expenditures of approximately $2 $6 million on free cash flow was slightly positive at $100000.
We returned a total of approximately $5 million to shareholders in the first quarter and dividends, which was flat with the prior quarter since initiating our dividend over two years ago. We've returned approximately $78 million in cash to shareholders in the form of dividends and share repurchases.
We ended the first quarter with approximately $55 million on cash and $35 million available under our Undrawn credit facility for a total of $90 million of liquidity.
Turning to our outlook.
<unk> systems deployed in the first quarter were up approximately 24% from fourth quarter 2020 levels. As we began 2021 with the strong momentum and experienced a minimal impact on fully utilized systems from inclement weather in February.
Each of the early activity gains we saw on the first quarter combined with continued public operators commitment of capital discipline, we anticipate our activity to be flattish in the second quarter from average first quarter levels.
Total SG&A costs from the first quarter were approximately $4 $6 million inclusive of noncash stock based compensation.
For the second quarter of 2021, we expect total SG&A to be roughly $5 million inclusive of the normal quarterly expensing of noncash stock compensation.
Our typical maintenance capital spending requirements, including for system enhancements and upgrades for today's level of activity should run at approximately $5 million to $10 million per year.
Our capital expenditures for 2020 came in at the lower end of that range at $5 million due to lower activity levels and testing in several automation and dust control enhancements that we were not yet ready to deploy.
For full year 2021, we now expect our capital spending to be in the range of $10 million to $15 million due primarily to new growth capital initiatives Bill discussed, including the water Siloed conversions and continued system enhancements.
We are excited about our new product development and are continuing to push that automation and efficiency to low precious side of the web site. We also remain committed to deploying capital only where we believe we can drive incremental returns and we remain committed to our dividend and strong debt free balance sheet.
With that we'd be happy to take your questions.
Yeah.
We will now begin the question and answer session.
I ask a question you May press Star then one on your Touchtone phone.
If you are using a speakerphone. Please pick up your handset before pressing the keys. If at anytime you question. That's been addressed and you would like to withdraw. Your question. Please press Star then two at this time, we will pause momentarily to assemble our roster.
Our first question will come from George O'leary with Tudor Pickering, Holt and company. Please go ahead.
On the the.
The simulcast <unk> side, you guys said, you're continuing to see larger customers pursue some of <unk>.
To hear the same I guess.
Like water has been one of the main constraints there is that adding to the demand that you guys are seeing to convert the sand silos to water silos.
Yeah, George good morning.
That's exactly what's happening so the need for.
Buffer with hydrostatic head right at the well side of was a lot of of localize pumping around between Frac tanks and having the three the system with the three pack of essentially four water makes that provides us much more significant buffer at those high rates of they're pulling the water off.
Yeah.
Great. That's helpful. And then just one related question and then I'll have a follow up but what's the cost of a conversion to convert of sand silos to of water silo.
Good day.
George I think.
I don't think we're going to get into details of the conversion costs at this point, but we really like the idea of converting assets that are already on our balance sheet.
Built to 166 systems that were probably close to 400 factories running. So this allows us to redeploy those assets in an accretive way.
Fair enough. Thanks for that Kyle and then just one more as you look on to the second quarter. It seems like Frac activity is off to a good start I'm sure you ended last quarter at a much higher point than where you started it so kind of two questions in one.
How much do you think the the silo accounts will be up in the in the second quarter and then just from a geographic perspective. It seems like conditions have been more broad based on just the Permian in recent months. So you see in shots on goal across the board or is it more based on specific any color there would be great.
Well I'll address the first half of the collar answer.
And from the second half I think that we saw ramp up a little earlier than we expected.
So I don't know, whether we I mean, we've got momentum kind of going out of the.
Out of the first quarter on the second quarter, but I don't think we're forecasting a max of the leap and the activity levels in the second quarter at this point. So I think thats why we are sort of indicating flattish for the for the quarter, because we sort of thought we'd see a steady ramp through the quarter and really mid January things picked up pretty quickly.
Yeah. The other comment I'd make is the obviously when we look at the rig count has been a significant increase in a lot of the privates.
And that work independent of private by private but some of that work can be a little bit spotty here with more white space on the calendar. So you've got to be careful when we just look at pure rig counts of our peer quoted frack counts in different areas on the way we report our fully utilized systems, we're taking into account.
Net potential white space in those sort of.
Non large public operators.
And then if you look at the sort of 80 plus systems, we reported of working in the quarter, that's really the effective number of.
The required crews if you will to meet that demand.
Great. Thanks, Colin Bell.
Okay.
Our next question will come from Jon Hunter with Cowen. Please go ahead.
Hey, good morning.
John.
So on the last call we discussed the potential for E&ps to fall of 'twenty to spend or activity end of the second half of 'twenty one of the commodity price remained constructive.
Which it has around the $60 level, so where we sit today is there any indication that.
Public E&ps may Paul 20 to spend into the second half.
Or do you see any potential activity increase in the second half really only driven by the privates.
No I think the.
The theory still holds I mean, I think we're seeing that it takes a little longer for the larger cohorts to get ramped up and I think we're seeing them getting wrapped up in the sort of third and fourth quarter activity levels. So they obviously once this once the bargains roll on as it takes a while to get roll on but it keeps rolling in and I think we're seeing that in their planning cycle.
For the fourth quarter, probably of activity, mostly yielding color I'd add to that is if we look at M&A and the impact of consolidation and what that does so one of our indirect customers has been a consolidator and they're looking at high grading the pro forma portfolio, so they're not necessarily keeping all of the activity of the.
<unk> companies on the net basis that consolidator could show a.
On a reduction of activity if you look at a plus b.
So that's sort of a bit of that wind in that piece.
That makes sense. Thanks for that and then my follow up is on the margin if I heard correctly I think.
You said that margin would have been in line with the <unk> 20 level absent the weather impact so.
First correct me if I'm wrong there.
And then secondly.
That level would be around a million bucks of gross profit per system. So I'm curious if you see any upside to that level.
Later, this year or on a normalized basis going forward.
Yeah, I'll kind of of trying to address the first quarter. You know obviously I mean, you alluded to your spoke directly to the impact of the storms, which didn't necessarily impact of the utilization, but did impact a little bit on the profitability side on.
The first quarter always is going to have a bit of the step up in costs as well.
You're resetting some of your annual cost of debt by the end of the year on.
You are no longer accruing.
The other piece that we I think of AA addressed on the first the last call was we did have a bit of a lag in ramping up our re hiring in the field in the fourth quarter.
Relative to the activity pickup so we did do that in the first quarter, so that had a little bit of the headwind.
But yes, I think what we've provided so far this morning is the guidance around expected Q2 Q2 profitability. The look more like Q4 and then the other piece just when we look at on the net basis on a margin percentage basis, we've got a considered as last mile and so that will obviously drive.
On the margin percentages up or down depending on the relative amount of activity there, but ultimately it shouldnt impact.
Negatively the contribution of dollars of margin contribution.
Understood. Thanks for that Kyle I'll turn it back.
Yes.
Okay.
Our next question will come from Ian Macpherson with Simmons. Please go ahead.
Thanks, Good morning, Bill and Kyle I'm curious on the.
On the water system conversions is that something where your value to the outside is really demonstrated when your package together with your sand and water systems together do you need the combination.
To deliver value work and the SBA discreet and separate services.
Sold separately to the customer from the.
The sand systems.
No. It can function completely independent I think of it does fit nicely when we have the the new the blending technology out there, but it from the.
From a sand silo perspective, the water can be used.
On the into a traditional <unk>.
Mixing system, just like anything else is actually it provides the same benefits of the same simplicity and the same buffer the.
They would either with either of our sand equipment or somebody else's one small anecdote on that recently when he got it from a customer they're using.
Different water storage on location and it requires a and.
And the individuals of the add on location 24 hours a day running a manual pump depending.
Depending on sort of the the.
The operations at the car.
Time, so by using our system and by locating it right next to the Blender, we're able to eliminate of fulltime in play so that the value proposition whether somebody's using are on the same centered on.
Okay.
It sounds like this is still fairly early we're not seeing material accretion from it and your second quarter Guide do you think that this is something of an opportunity for for EBITDA accretion.
On flat Frac activity from Q2 into Q3.
Yeah, we think we'll be deploying.
The few more of these throughout the quarter, we've got demand for them, where they think convergence as we speak so we do see that the bigger.
Beginning of ramp I don't think it's going to be massively meaningful in the overall scheme of the EBITDA, but it's it's it's accretive it's driving towards Solaris as the low pressure the comprehensive low pressure equipment.
Suppliers, so that's water sand chemicals and the the new lender.
Yes.
And then last one from me on the New Blender is the timeline there is still development on trial throughout this year and then commercial next year I mean, I thought that the the comment you made about up to 80% personnel reduction towns.
Obviously, usually true transformative.
So just wanted to get a sense of of win that.
The rollout.
As scheduled at this point.
We're scheduled to go on the first well site and we've done extensive testing of Ed minds and in the facility of its got to be on the well side here in the next couple of weeks.
And run that through the through the quarter we have.
Through all of our trials identified a few little tweaks that we're going to make we have began to unlisted ordering some of the long lead items, which we think are consistent between you don't want on unit two so.
Think it still is the back half in the back half of fourth quarter of this year.
2022.
<unk>.
Transformative.
Is that for us not really much this year.
Got it thanks, Bill Thanks, Scott.
Our next question will come from Stephen <unk> with Stifel. Please go ahead.
Hi, Thanks, good morning.
I have two things I apologize if you're addressing the earlier I joined a little bit late but first.
When you think about.
Some of the incremental profitability per fleet as we sort of model of an activity changes going forward.
On a gross profit basis, I think the sort of the the target is probably close to a annualized number of 900 thousands of $1 million is that a reasonable way to think about it as we as we go forward here.
Yeah, I think pricing has been consistent from a cost perspective, I think I described just a few minutes back debt you did have a of lagging some pick up in cost from the fourth quarter. So we kind of caught up in the first quarter on that from a direct field technician standpoint.
So I think those profitability targets remain.
Okay.
Yeah, and I would add one more of a bit of color to that I think it kind of seasonality you may not necessarily see it in a quarter or two but you would see it on a full year basis I think that's still the right target on a full year basis.
Great. Thanks, and then.
My second question just.
When you think about the competitive landscape on the sort of on the Frac sand system side I mean, if we go back a year and a half you know people are talking a lot about competition and it seems to have died out you guys seem to kind.
Kind of remain sort of of the big leader on the silo side are you seeing any change in the competitive landscape are you seeing any anything evolving either recently or over the last year.
How do you how do you think about just the competition as it pertains to your business on the sand side and maybe if there's any commentary on price of around that it would be helpful.
Well I think price is consistent I think one of the one of the evolutions will be the the payload capacity of the trucking sand and the addition of using our non pneumatic system or other ways of filling the silo. So so I think we're seeing.
And some of this is driven by the shortage of truck drivers and other issues that we're seeing continued maybe push for.
Additional belly dump capacity capabilities and really as a as a trend I'm trying to increased payloads per truck up, especially means when drivers of scare. So we're seeing that continue you know theres a little bit of wet sand here on their trials there going on and we've worked on our R&D around some of that as well so.
It's a competitive market. It always has been our goal is to stay ahead of the competition with our R&D efforts in trying to maintain the net delivered cost to our customers over time, which means the reliability as a key factor in that calculation.
We deliver of product that helps our customers be more efficient.
Great. Thank you.
Our next question will come from Samantha Hoh with Evercore ISI. Please go ahead.
Hey, guys.
About the wells late trials that you have lined up is that for an integrated system, combining your frac sand water silos with the hygiene.
The system.
And if you could actually talk about how long of the trials that would be helpful.
It is worth of it is with the the combo package. If you will where we're targeting doing this on some small on some smaller pads of single wells, obviously at the trial.
Probably sometimes don't go perfectly so we don't want to be in a position, where we're risking much of our customer, but we are of a lot of confidence in all of the testing we've done on it so far but it will be a combo of system and it's going to be we're not we're not gonna do the sort of on a more.
Massive pad simulcast operation for per test one.
And the way, we're looking at it as developing acute.
Trials of people with multiple operators in multiple basins.
And is it just from sort of like one system one water system.
Sure.
Can you just talk about maybe the pace of the conversion from the profit on the water system.
Yes, and typically the water system, we think of it as three silos. So when we convert a sand system, which has six islands. The creates two water systems. If you will.
Now that being said as the cycle of practices kind of continue to take share we are seeing demand for more water storage capacity on site. So.
Some of the work that we've got in the Qs is contemplating six packs, where we actually put five Warner silos out and one either asset silo or one of our chemical compartments with our chemical silos with two separate compartments.
Sort of referring of those of combo packs and when we looked at the Chem system in the early days, we were trying to optimize volumes with three silos and depending on the completion design. It may make more sense for operators to want more water storage and just a little bit of the chem storage. So we've been able to be flexible there and I.
Think that's been helpful in pursuit in receiving pretty well in the in the market. So those combo packs R.
Or are the interesting way to.
Put this together.
Okay that is interesting question quick question about the chance alright, translating business you highlighted.
Providing transport for our wind power installations in Oklahoma.
I'm just kind of curious if this is sort of like early in the installation phase of the project because I think theres been some orders.
Orders for some of just like really massive projects out in that area.
Curious if this is just sort of like of ramping up is that something that could be sort of the.
Jay.
We hope you're correct.
We believe that it's the their customers there have said that they have a growing need for it. We've obviously got a significant rail capacity there in the AZ switches and so we see that we see of growing it.
A large component of of the business, but we do see using that facility of that way is going to.
It makes the contribution.
Okay. Thanks to that does the suite.
Thanks.
Our next question will come from J B Lowe with Citi. Please go ahead.
Hey, good morning.
Good morning style of on how are you doing.
Just wanted to.
To just.
Clarifying something so you'd think activity will be up in <unk>, but some of the costs from <unk> should be should be rolling off.
Does that mean that you think EBITDA <unk> will be up.
Yes, I'll try and clarify I think what we described the activity was being flattish.
Okay.
You'll get a little bit of the pick up from not having the winter storm from a margin perspective, but no I don't think we see any costs rolling off.
So it was more of EBITDA also of flattish.
I think that's probably right.
Okay.
On the water system is that kind of you know.
Converting some titles the water zone is that a way that debt you could potentially pick up some customers. Some of I guess from new customers that potentially had been traditionally box users.
<unk> offered them the.
The silo system on the water side of that kind of a is that something that could open up I guess of new customer because you haven't necessarily absolutely yes on the water sales will work in conjunction with any other system. So we're prioritizing the rollout of those with our same side of the.
Customers, but because we're making them as quick as were getting them in the field, but certainly they will function well and we have no problem.
Expanding the market with them, where they say it.
Cool.
The kind of a follow up to that on on.
Kind of your market share on the standard systems I mean have you guys been I mean, obviously you.
Track Frac crews probably closer than anybody have you seen any significant shift in your market share.
Of the sand system, you know the silos of persons boxes of you guys versus some of your big competitors have there been any major shifts kind of coming.
The recovery of kind of picked up here.
Any significant shifts on that front.
I wouldn't say necessarily of major shifts I think consolidation both on the pumper and operator side has had implications to market share for everyone on some days, you're benefiting from the consolidation and some days it's not.
Not helping.
Right.
I think I've kind of mentioned this earlier, but the the way we run our fully utilized crew count versus what was active in the quarter. It ends up being when you have white space and activity of.
It becomes more dramatic than when everyone's study. So if you look at the difference between the 50 ish in the 80 net eighties on that would indicate the things there are some spotty in this in the market today.
The hopefully as we see.
The the bit of the major stepping back and things get a little bit more programmatic and a little bit more stable steady and you're you you you get a closer match.
Match between the fully utilized count and the actual system views.
Gotcha, Okay last one just on the on the wind project.
On the home on the it just using the old Kingfisher facility site.
Yes, that's correct, so using the rail facility and the and the land.
Okay. So is it more of our people actually you know bring in.
Railcars in the with supplies from the project or is it just kind of using the Atlanta as a staging area are both of it.
It's more of the latter at this point.
Gotcha Okay.
Cool thanks, guys.
Thanks.
Our next question will come from of Crest Boy with Wells Fargo. Please go ahead.
Thanks. Good morning, just curious on the water Siloed systems, how do those get factored into the accounts do they count as half of the silo system for next quarter I think he said he on about five right now so just curious how you're going to count them and then on the pricing side is it kind of half the revenue of the same silo. Just curious if you can help on that.
Yes. So if you look at Frac, Inc. Today, I don't know if they're down a couple of hundred Bucks a day, they're very very cheap or maybe even cheaper than that.
So the calorie count if you will on the the water side of it is.
Going to be quite small relative to what we have on the sand system. So at this point, we're not really breaking it out because of the small size of it and then from a go forward system count when we when we report systems, we're talking about sales.
And at this point the contribution from the water systems has not been significant enough to the carve out from the the revenue side.
But your assumption is correct. It is it is three silos for a water system not sick so that is correct.
So on the near term I'm, just kind of be layered into the different bucket them.
Okay. That's that's helpful. And then just curious of the checking on chemicals any traction there in terms of additional uptake.
That's the et cetera.
Yeah, I think the again in the context of the the Blender that's driving demand and then also in the context of these hybrid combo models of water and some mix of acid in Kansas.
So the way we've kind of looked at that as an Ala carte menu in the sort of some of the parts from the pricing standpoint. So if you've got on for Ken systems full Chem system here with me on exit if youre using two thirds of a third of the Chem system and a little bit of water, we come up with the hybrid right.
Okay got it and maybe one last one on the integrated last mile is that growing or shrinking at this point.
I think every day, it's sort of influx of I would call. It in the quarter. It was probably flat quarter over quarter from a peer tonnage standpoint.
But we may have run more jobs.
Just sort of it depends on who you're working for how intense there their jobs, there, but I think from it.
Inbound request standpoint, it continues to be very strong.
And we continue to develop and enhance our offering there.
We've we haven't talked about it or we didn't talk about this morning, but we're continue to enhance our software offering around that.
Historically, we've had a lot of the inventory piece and a lot of the supply chain and we're getting deeper into a full comprehensive solution there for the.
The last mile software offering.
Of that sort of in an edge in the differentiator that helps drive activity and then from a personnel standpoint.
<unk> increased our internal capacity to handle that business as well.
Okay, great. Thank you.
Yeah.
Again, if you have a question. Please press star then one to be joined into the queue.
Our next question will come from Sean Mitchell with Daniel Energy Partners. Please go ahead.
Good morning, guys and thanks for taking my question.
A quick one from me.
You know as activity has ramped in North America, we've heard some guys in the oilfield or facing some challenges with labor I know Bill you mentioned truck drivers being somewhat tight is there any of the are there any of the issues you guys are seeing from the labor side or maybe can you.
Continue on a little bit more on the dialogue with the truck drivers and what you're seeing there.
But I think the labor is tight.
The tighter than the people want to admit sometimes right now and you know we've done our best of recruit we recruited.
As Carl mentioned in the fourth quarter of our system count sort of grew a little quicker than we had and we've been able to add and catch up in the first quarter you know not without its difficulties of the labor rates are are reasonable at this point, we don't see massive inflation. The drivers have been attracted by lots of other industries and or not wanting to work and.
The the pneumatic drivers versus the non pneumatic drivers were there back yeah. The the cycle times can be shorter with the loads and so we've seen it.
Get tight it's I think we've seen that across every industry right now on the country I think kind of the tip of the hat to our team both on our field management standpoint, but certainly the guys on the front lines of our average tenure in our field employees is over three years that is significantly higher than.
Any other oilfield services the business I'm aware of at the sort of scale that we're at so.
And I take that back there is definitely some competitors out there that would that would say it differently, but I think moving especially look at sort of the the trucking side of things youre going to see much higher turnover. So we've been able to demonstrate a career path for folks.
Widening skill sets.
And also being around a business that's got continue.
On continuous new technology, new offerings that sort of of an exciting place I think to work for people and the other big piece on that is the obviously everything we've done has been oriented around automation and where operation is required doing it remotely. So you know historically you had an individual that would fit set of bar.
The the blender Hopper and run the sand system and today a lot of those guys are running that system using our auto hopper system and doing it through the in the data band taking somebody off the <unk>.
The the hard hat zone, so to speak and they're they're sitting in the chair in a comfortable of air conditioning environment. So those are some of the.
Ways, we're trying to help the industry address the inherent challenges around labor.
Thanks for the color really appreciate it.
Thanks, Sean.
This concludes our question and answer session I would like to turn the conference back over the bills are for any closing remarks.
Thanks, Matt I'd like to finish by thanking all of our employees and partners for your perseverance in the adaptability.
These results would not be possible without your help get Solaris off to a great start of 2021, and we're well positioned to continue helping our customers drive innovation and efficiencies on the well site and.
Thank you all and stay safe and have a great day.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.