Q4 2023 Profire Energy Inc Earnings Call
[music].
Good morning, everyone and thank you for participating in today's conference call to discuss pro forma Energy's fourth quarter and full year 2023 ended December 31st 2023.
After the presentation, there will be an opportunity to ask question to join the question queue. You May Press Star then one on your telephone keypad should you need assistance during the conference call you may signal, an operator by pressing star and deal.
I would now like to turn the call over to Steven Hooser Investor Relations to get the call started please go ahead.
Thank you operator.
On the call today is co CEO and CFO of pro fired energy, Ryan, albeit and co CEO Cameron Tidball.
Yesterday after the market closed the company filed its Form 10-K, with the SEC and discuss the quarter and full year highlights in a press release as always both of those documents are available on the investors section of the company's website.
This call will be posted in the coming days before we begin today's call I would like to take a moment to read the company's safe Harbor statement. They can play during this call.
All historical are forward looking statements. This call contains forward looking statements, including but not limited to statements regarding the company's expected. The ctrip suggests a diversification efforts.
Research and development of new products, both in our customer base increased global demand for hydrocarbons.
Of our partner service network increased.
All such forward looking statements are subject to uncertainties and changes in circumstances forward looking statements are not guarantees of future results or performance and involve risks assumptions and uncertainties that could cause actual events or results to differ materially from the events or results described in an anticipated by the forward looking statements factors there.
It could materially affect such forward looking statements include certain economic business public market and regulatory risk factors identified in the Companys periodic reports filed with the Securities and Exchange Commission.
All forward looking statements are made pursuant to the safe Harbor provision in the private Securities Litigation Reform Act of 1995. All forward looking statements are made only as of the date of this release and the company assumes no obligation to update forward looking statements to reflect subsequent events or circumstances, except as required by law.
Readers should not place undue reliance on these forward looking statements.
Also like to remind everyone that this call is being recorded and will be available for replay through March 28, 2024, starting later this evening.
It will be accessible via a link provided in yesterday's press release as well as the company's website at Www Dot co fired energy Dot com.
Following the remarks by Mr. <unk> and Mr. Tidball will open up the call for your questions now I would like to turn the call over to co CEO and CFO of higher energy, Mr. Ryan up yet Ryan.
Thank you Steven and welcome to all of you who are joining us on the call today.
We'll start the call by providing some updates on our business and the industry followed by a review of the financial results and then I will turn the call over to Kam to discuss outlook strategic direction and provide an update on our diversification strategy.
2023 was a great year for pro fire, we had our best year in company history, beating our prior best year for revenue by 14%, which occurred in fiscal 2015 of $51 2 million.
In 2023, we recognized $58 2 million in revenue, which exceeded our prior your revenue by 27%.
We also achieved company best and gross profit dollars operating income net income earnings per share and EBITDA.
We are very excited about what we've been able to achieve over this past year and the new ground, we are breaking for profile.
These achievements have been the culmination of consistent and steady execution of Companys strategy for many years.
We are also seeing great success in our efforts to diversify our revenue into critical energy infrastructure and non oil and gas markets.
Okay.
In 2021, and our diversification efforts represented less than 1% of total revenue increased to 6% in 2022 and last year accounted for 13% of total revenue. We expect to continue building on this momentum, which Ken will discuss in more detail later.
Both the IEA and OPEC forecast global demand growth of more than one 2 million barrels per day. This year with the trend to continue for the remainder of the decade. We expect operators will continue their efforts to catch up on the maintenance that had previously been deferred in recent years.
But also understand that some long term capital investments may be deferred in 2024 in the lead up to and pending the outcome of the current year election cycle.
Looking at our core legacy business, the combined onshore rig count for the U S and Canada averaged 848 rigs in 2023, representing a 4% decrease from the prior year.
The average <unk> price per barrel in 2023 was $78, representing an 18% decrease from the previous year.
Producers continue to draw down on previously drilled but uncompleted wells as the DUC count decreased to 4400 at the end of 2023, representing a 51% dropped from its peak in June of 2020 <unk>.
Despite the downward trend of these industry metrics profile was still able to achieve its best performance in the past 22 years of operation.
With that let me turn my remarks to profile, our financial results for the fourth quarter and full year 2023.
In the fourth quarter, we recognized $14 4 million in revenue compared to $14 8 million in the third quarter and $14 million in the prior year quarter.
Gross profit increased to $7 8 million as compared to $7 5 million in the third quarter of 2023 and.
$6 6 million in the year ago quarter gross margin increased 390 basis points sequentially and 730 basis points from the prior year quarter to 54, 3% of revenue.
This was due primarily to product and customer mix normal inventory and warranty adjustments and pricing initiatives.
Total operating expenses for the fourth quarter were approximately $5 million compared to $4 9 million in the third quarter and $4 3 million in the fourth quarter of 2022, the sequential and year over year increases reflect.
Cost inflation across our business as well as growth in business activity driving up variable costs, specifically G&A expenses for the fourth quarter remained flat sequentially and increased 18% year over year.
R&D expenses increased 47% on a sequential basis and increased 15% from the prior year quarter.
This is simply due to the timing of R&D projects and certification requirements.
Depreciation and amortization were flat with the prior quarter as well as with the same quarter of last year.
Net income for the fourth quarter was approximately $3 3 million or <unk> <unk> per diluted share. This quarter's results include a one time 828000 or <unk> <unk> per diluted share benefit generated from our reduction adjustment to deferred tax expense based on a detailed review of our deferred tax balances.
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Net income in the third quarter of 2023 with $2 million or four cents per diluted share and $1 8 million or <unk> <unk> per diluted share in the fourth quarter of last year.
Cash flow from operations in the fourth quarter was approximately $4 4 million compared to $1 7 million in the prior year quarter.
For the full year 2023, we recognized $58 2 million in revenue. This compares to $45 9 million in 2022.
27% increase is primarily due to the factors stated earlier.
Gross profit increased to $30 5 million as compared to $21 7 million in the prior year.
Gross margin increased to 52, 5% of revenues from 47, 1% in the prior year.
This year over year increase in gross margin is primarily due to better fixed cost coverage, which offset inflationary pressures on variable costs.
Total operating expenses for the year were approximately $18 7 million compared to $16 5 million in 2022.
The increase is primarily related to higher G&A expense, resulting from overall cost inflation. However, the overall rate of increase remained lower than our revenue growth rate for the year.
Over the past 10 years total operating expenses as a percent of revenue have ranged between 32% and 59%.
With 2023 being the lowest mark in this range. Despite the significant inflationary pressures over the past few years, our strategic efforts in managing costs and building in operational efficiencies combined with our sales price initiatives have helped us achieve this great operating margin are.
<unk> expenses decreased 13% and depreciation and amortization decreased 8% compared to the prior year.
Total other income during the year was 592000 compared to 492000 last year the.
The increase is primarily attributable to higher interest income due to a combination of higher rates paid on our cash balance and short term investments.
Net income for the year was approximately $10 8 million or <unk> 22 cents per diluted share, which includes <unk> <unk> related to the deferred tax adjustment referenced earlier.
This compares to net income of $3 9 million or eight cents per diluted share last year.
Cash flow from operations for the full year with $7 1 million and our cash and other investments totaled $20 million compared to $16 million at the end of 2022.
We had no borrowings or other debt on the balance sheet at year end.
Net capital expenditures for the year were approximately 873000.
During the year, we were able to repurchase $2 million worth of profile stock. According to our approved share repurchase program.
Our inventory balance at the end of the year was approximately $14 1 million compared to $10 3 million at the end of 2022.
Over the past two years, we've been able to implement several tax planning strategies that have had a significant benefit on our financial performance and results of operations.
These include filing for and receiving the employee retention credit through the cares Act the strategic use of several years of net operating losses in our Canadian subsidiary.
And the deferred tax review true I've mentioned previously.
We will continue to deploy our best efforts in identifying and implementing these types of strategic opportunities in the future when they arise. However, we cannot guarantee that similar opportunities will be available to us in future periods.
Because we were able to take advantage of these opportunities in 2023 operating expenses were lowered by $760000.
Income tax expenses were reduced and net income increased by $1 9 million or four cents per diluted share.
However, even when removing these nonrecurring adjustments 2023 remains our best year in company history from an operating income net income and earnings per share perspective as.
As I mentioned previously we are very proud of what we've been able to accomplish in 2023 and the position. These accomplishments put us and to be able to continue to do great things in coming years.
I will now turn the call over to Cam to provide an overview of our business Cam.
Thanks, Ryan and good morning to everyone.
Throughout 2023, the profile our team achieved a record setting pace, leading to our best results in company history, setting a new benchmark for financial performance.
Our team successfully navigated a challenged industry facing difficult headwinds surrounding supply chain reality.
As well as a dynamic regulatory environment.
Pro fire products and solutions deliver value and performance to our customers and support industries.
Place attention on lowering their carbon footprint, reducing greenhouse gas emission.
Creasing operational efficiency and are committed to safety.
Our strong fourth quarter capped off a record setting year for pro fire as we achieved exceptional year over year growth in our consolidated topline revenue performance of nearly 27%.
Our 2023 full year results demonstrate sustained execution strength across each area of focus.
Including our traditional upstream business downstream utility and transmission markets as well as our focus diversification efforts in critical energy infrastructure, and various non oil and gas and industrial markets.
Profile continues to be the burner management solution provider of the top E&ps in North America, such as EQT, Chevron and Oxy, Devon energy Canadian natural resources, Synovus, Chesapeake Conoco and X T O in.
In 2023 this space represented nearly 83% of our total revenue compared to 90% in 2022 with nearly 17% growth year over year.
Our upstream market growth is attributed to customer acquisition and increased market penetration as well as our sustained focus by producers to expand their automation capabilities on new and legacy they're more appliances as well as to improve efficiency and upgrade nabatic appliances to meet both internal and <unk>.
Tori emissions targets and requirement.
This led to increased opportunities for retrofits for profile directly and through our growing partner service network.
North American oil and gas production reached record highs in 2023. This remarkable outcome was accomplished with overall rig counts dropping during the year by approximately 26% and despite federal administration that stress their desire and the industry within a decade.
As we look to 2024, we expect onshore drilling in North America to stay relatively flat however, as takeaway capacity increases through new LNG terminals and gas pipelines coming on stream in the short term, we expect an eventual boost to drilling activity towards the second half of the year into 'twenty two.
Five.
Overall, we look at 2023 and 'twenty 'twenty four as periods of stability that we continue to monitor geopolitical factors such as the situations in eastern Europe, the middle East as well as the uncertainty surrounding China and Taiwan.
The overall global demand for hydrocarbons in 'twenty 'twenty four is expected to grow at a slower pace than 2023.
<unk> remains the industry consensus expectation.
We believe that the majority of North American production growth in 2024 will come from the Permian Basin.
In anticipation of near and long term growth in this valuable geographic hydrocarbon play profile has invested in expanding its footprint and capabilities in the Permian basin. In Q1, we were able to open a new facility in Odessa, Texas, which we intend to support organic sales and service growth and improve.
Our overall speed of delivery and support of our customers.
Turning now to our progress and growth in downstream natural gas utility and distribution our customers in this space play a distinct role in the process of supplying natural gas from production sources to end users, including businesses and residential use.
We continue to focus on growing our customer base in markets, we have a geographic presence for sales and support as well as through our efforts to expand our partner program.
In 2023, we achieved record performance in the number of customers and associated revenue in this space year over year, we achieved over 40% growth equating to nearly 5% of our total revenue.
Now looking at our areas of diversification, beginning with our progress and critical energy infrastructure.
Critical energy infrastructure consists of the central systems that play a vital role in the production transmission distribution and storage of energy resources profile continues to gain traction with customers Oems systems integrators and E T six who support the construction maintenance and upgrading of plants.
Transmission and distribution networks, as well as production and storage facilities.
2023 marked our best year in company history in terms of top line revenue related to customers and projects and critical energy infrastructure. In 2023, we achieved $5 6 million in revenue compared to $1 4 million in 2022.
Our investments in sales focus service capability training product development and project delivery continued to generate a strong return as demonstrated by our 300% increase year over year.
In 2023 revenue generated in this market nearly hit 10% of total revenue as opposed to 3% in 2022.
So fires presence Amit critical sites is a testament to the performance of our products as reliability functional safety certification are essential requirements given the critical nature of these thermal appliances.
Profile continues to add to its reputation in this area and our list of projects and customers continues to grow.
In 2023, we worked with a record number of existing and new customers, including Kinder Morgan TC energy energy transfer Alpha Gal Enbridge enterprise products D. C. P handle now Williams Targa and MPLX to name a few.
We also continued to strengthen existing relationships and working with new Oems who support projects in this space.
As we look forward, we believe profile stands to continue to gain momentum and traction and critical energy infrastructure as operators look for ways to improve safety and efficiency and reduced site emission.
We expect global LNG demand to increase through 2040 and beyond requiring an increased production of 70% compared to 2023.
The U S became the world's largest LNG exporter in 2023, surpassing Qatar.
This may be short lived however, it is expected that by 2030, North America will cover over 30% of global LNG demand obtaining a large portion of its feedstock from the Permian DJ Marcellus and Montney shale plays.
So the global gas market is exposed to risks, including the Biden administrations pause on new LNG export terminal and expansion approvals and guitars plans to rapidly expand we feel there remains a massive runway for north American LNG expansion, which should be positive for profile.
Finally, as we look at our diversification progress and taking pro fire products and solutions to non oil and gas and industrial markets. We are excited to report that the second half of 2023 represented our two best quarters in company history for revenue sales orders received and project pipeline.
Our backlog of projects and project opportunities has never been stronger.
In 2023, we achieved nearly 30% year over year growth. Our results were slightly reduced due to the longer term project cycles that are inherent to the new industries. We are working and we expect most of these projects will be completed in 2024.
2023 was an exciting year for pro fires, we executed an increased number of projects in a variety of industries, including landfill biogas RMG production power generation wastewater agriculture, food and beverage mining heat treat and metal manufacturing and coal processing.
As we enter new industries, we find opportunities to work with new Oems and system integrators, and EPC, who continue to be impressed by our products are project process and deliverables.
We feel that this will assist us as we look to build out our partner support network of sales and service in new geographic locations.
We expect to achieve strong diversification growth in 2024 based on the current backlog and pipeline of opportunities that we are actively involved in terms of sight scopes quoting and the technical discussions surrounding these potential projects.
In 2023 pro Fire's revenue outside of upstream oil and gas equated to over 17% of total revenue as compared to 10% in 2022.
This resulted in profile achieving over $10 million in revenue derived from our diversification progress in critical energy infrastructure, and non oil and gas markets as well as our strategic growth in the downstream utility and transmission space.
This combined strategic growth is a monumental achievement and sets the stage for us going forward.
Finding accretive M&A opportunities for profile remains at the forefront of our plans to date, we have yet to find the right opportunity for profile. However, we continue with our pursuit of transactions that will add scale entrance into new markets and expand the products that we can bring to our existing customers.
Investment in research and product development remains critical to the future of pro fire. We plan to continue developing new products to support our legacy in traditional markets as well as our diversification efforts. This will continue to follow our balanced approach to short mid and long term product development and research processes.
We're excited for the future of profile.
Our customer centric team and approach to improving the user experience sets us apart from our competition, we refused to rest on our laurels and we continue to forge ahead in support of our current customers and markets as well as those in our future.
Brian and I Express, our sincere appreciation to our team and to their families to our shareholders. Thank you for your continued interest and support of profile. Operator would you. Please provide the appropriate instructions. So we can get the Q&A started.
Secondly, the join the question queue you May Press Star then one on your telephone keypad.
I told her knowledge in your request if youre using a speakerphone. Please pick up your handset before pressing any keys to withdraw your question. Please press Star then two.
The first question comes from Rob Brown with Lake Street Capital markets. Please go ahead.
Good morning, Rob and good morning good.
Good morning, Congratulations on all the progress.
Thank you. Thank you.
Hi.
You did a good kind of overview of the diversification efforts, but you alluded to a project.
Pipeline and strength there could you just give us some kind of color on what that project backlog looks like it.
So that pipeline is sort of shaping up for 2012.
Yeah, absolutely and thanks for joining our call as always Rob.
As we look at 2023, obviously, we had 30% growth year over year in terms of non oil and gas and industrial projects.
We alluded to and why we didn't allude to it in the comments are that number would have been higher but these projects, sometimes taking a little bit longer they're larger in scale and they have different complexities with regards to permitting, especially when you're dealing with biogas landfill.
Vacation so some of those projects, we thought would close and materialized in 2023 will move into 2024.
Overall as mentioned are still without those had our best year ever.
And just the growing number of projects.
<unk> in terms of the customers, we're going back to to do a round number two or three to look at sites that we can support them with their combustion and thermal appliances, it's growing our backlog and pipeline, we don't obviously disclose it.
But it's higher than it was last year and so we feel that we have good reason to believe we're going to have another strong growth year in that space.
We'd look at we're still to a degree I'm looking at a lot of different industries, we haven't nailed down our targeted a few that we really want to put a whole bunch of horsepower behind because we're still determining what is what is the best place for profile right now the best places anywhere that needs combustion appliances, but.
Eventually, we'll be able to target more sales efforts more marketing efforts are potentially some strategic.
Acquisitions in those places to help us to expand maybe in a particular market, but right now a very diverse in terms of where we're seeing interest where we're seeing opportunities where we're getting brought into from the Oems who are working with as well as systems integrators, the new E P CS that or.
Hearing about the profile name hearing about us from other projects as well as people move from industry not so much industry the industry, but within the industries there at they're bringing us along so very excited about the progress.
We think that we have.
Can continue to grow this space for many years to come and there's so many opportunities out there and it's very exciting for profile. Ryan would you have anything that I missed there it can get.
No.
I don't think he missed anything I would just maybe expand and say that we're seeing similar trends with the legacy business as well.
As far as the project pipeline is concerned that the number of projects that were.
Getting in on a regular basis is still remains very strong and good we're seeing a lot of indications for later in the year as well. So we're seeing some projects stacking up for Q2 and beyond in our pipeline which grew.
Going back several years wasn't.
The thing that typically happens for us it is much more short term than that.
One other aspect, though that we are seeing is our customers are at least some of our traditional customer base.
Is starting to believe that supply chain is.
Much much better, which it is improved but they might be placing a little too much reliance on how good the supply chain is right now so where we're seeing some interesting dynamics shifting in that pipeline, but overall as Ken said.
It's very strong it's very robust and we're excited about it.
What what will come in 2024.
Yeah.
Great.
Oh, Thanks for that and then in terms of a legacy business that you've talked about kind.
Gotta catch up of deferred maintenance and some of the regulatory environment, but is that really the drivers that are helping.
Helping that business, despite maybe oil prices down a little bit.
Yeah.
What are the drivers that are really pushing that.
Yes.
Yeah in the legacy business, if we go specifically to say we'll call. It upstream obviously drilling is down year over year.
But what oil prices are still at a point, where we see.
Customers are very things are very healthy for them. The record profits of 2022 and 'twenty three may not be replicated it in 2020 for a warm weather winter like this obviously it has a drain to a degree on the gas side of the business, but oil is still very strong.
You look at.
Some of the pipeline capacity, we talked about in the comments there coming onboard here, obviously that helps with LNG as well, but you've got a lot still.
Call for growth in production this year, the United States had a record year last year historical year, and we think it really speaks to the resiliency of this industry. Despite.
Despite.
I guess, some that believe we don't need hydrocarbons.
It's evident we do Theres still is obviously a little bit.
Hires on the supply side, OPEC, plus and their production cuts extending through Q2, obviously signal that and there is some difference of opinion on stockpiles right now if a conflict where to breakout is there enough. There's a few opinions that there is and there's quite a few that there is not so.
Overall, you you've mentioned it there there still is a backlog of deferred maintenance of the deferred upgrading that is driving the business for sure. We had our best year in 2023 in terms of retrofits, whether they were directly with profile worked through.
There are a variety of partners and each shale play that do.
Burner maintenance burner upgrades.
We do not see E&P slowing down.
Upgrading their appliances.
To meet different.
Regulatory requirements or internal net zero goals or just reduction goals, especially on the public company side, we saw a ton of transactions last year and we're still seeing some this year more not as many in the Permian basin. So far this year, but we're seeing them out with EQT for example.
Gobbled up another couple of companies here.
We see Chesapeake on that bandwagon as well that will continue as they bring on these and emerge with these companies acquire these companies if they have legacy assets that need to be upgraded we fully expect them to continue to push for those upgrades. So.
Retrofit business continues to drive the business, obviously, new drilling and production with pro fires dominant market share.
We believe that helps us as we get more of the new production equipment, but the legacy business, which is still that looming massive opportunity are these legacy wells, if they're worth being in production, we feel that there's a good chance that their work being automated as we progress forward with different.
ESG goals that our customers have.
Okay, great. Thanks, I'll turn it over.
Thanks, Rob.
The next question comes from John Bair with ascend wealth advisors. Please go ahead.
Good morning, Kim Ryan.
Good morning.
Yeah, Congrats on a nice year and a good quarter two quick questions number one.
It didn't indicated in your prepared remarks about inventories being up is that an and.
Anticipation of of order flow or trying to get ahead of us.
Our supply chain issues or <unk>.
Pricing.
And the second question is can you talk anything about improvement or increase in activity that is more internationally oriented in other words outside of the North America.
You bet Ryan why don't you tackle the first part and I'll jump in on the second.
Yeah, Great question inventory is up year over year, and it's been up for most of 2023.
Kind of.
It started to accumulate early in the year and then we've continued to bring in product as we also had a great year itself.
A lot of that continues to be somewhat supply chain related a lot of our stuff is long lead time.
Orders, so we have to get those orders placed well in advance and then.
Come in as they come in so we've been able to bring in a bunch of the products that we had on order early from this year and even stuff that we were starting to order late in 2022.
So it's kind of just the timing of when all of that comes in and how we're trying to place their orders and stay ahead.
Two N of anticipated demand for our customers as I mentioned earlier some of the supply chain.
It is easing, but there's still a pretty long lead times in some of this stuff as well. We're also still in this transition period.
<unk> at the end of life of our 'twenty 100 system and the full rollout implementation of the 2200 system. So those there's still a mix there where we're accumulating a lot of the 22 hundreds getting those in in hand.
While we are still kind of closing out the 'twenty 100 side of our ordering as well, making sure that we have enough to.
To continue to satisfy the demand that we have right now, but also for warranty and ongoing support of that product down the road so that transition will.
We will continue throughout 2020.
For but kind of towards the end of the year, we would anticipate that most of that transition will be completed assuming the supply chain goes away. We think it will this year.
But that's a big piece of it is just kind of working through those transitions getting the right supply of that P. F. 'twenty 200 product.
And being able to fully transition customers over to that at the right point when we can continue to supply for them. They certainly don't like it if if they switch to the 2200 and then have to go back to the 'twenty 100 for a period of time, they want to be able to make that transition and continue to get the new product in them.
And have that be reliable for them going forward. So that's the process that we work through this as we're doing that and it has had an increase on inventory over the last two years for sure.
So at what point do you say, okay. No more 'twenty 100 will be would be sold in there. Obviously when you have an installed base and you're trying to transition existing car.
Customers away from the 20 122 so.
You know what at what point, how do you how do you kind of handle that situation.
Yeah. Good question and it's something that we continue to to.
To bounce around it changes if you'd asked that question three.
Three years ago, I would've said, we'd be done by now but supply chain. Obviously, you had a huge impact on us. So right now we're thinking it's kind of towards the end of this year early 2025 as to when we will.
Look to fully have that transition them to not be selling the 'twenty 100 pass that point, but again supply chain issues that may impact that that's our desire at this point, but we'll continue to deal with customers and support customers and work with our supply chain in whatever way we can.
Need to to make this be the right decision for both profile and our customer base.
Great.
I'll add to that before I jump into some commentary on international we plan to support our customers with parts for the 'twenty 100, you because obviously if you just shut off the tap them. They can't support the product after that Wouldnt go for a while but we think we have a strategy in place that will resonate with customers for their ability to keep some things going.
But also to a point, where it's a it will come a time, where you you've got a upgrade to one of our newer systems. So overall, we think the plan is going well like Brian said, we would've hoped to have transitioned a couple of years ago, but it's just the way it goes with the supply chain, but we're grateful that we have.
Ample supply now have both products, which is which is great in terms of international.
We've definitely seen an uptick to start the year most of it coming from South South America America, Latin America, particularly Argentina with the new President there.
Kind of shaping things a little bit differently, which we believe that it hasn't had a positive impact on those who invest in E&P production, there and we've seen some resulting orders. If you look at overall international now is approximately 46% of all rigs.
Our outside of the United States and Canada, that's that's higher than last year.
Very high percentage of that Overrepresent that of course is the middle East.
Which year over year, they're up a few rigs are at least 15 rigs.
A lot of that is in <unk>.
Places like Qatar, who are saying you know what we're going to jump on this LNG.
Track as quick as possible overall profile still.
Has our district distribution channels in the international markets, we're looking to strengthen.
Strengthening particularly in places where.
Where we see.
Great expansion for the future such as India.
So we're looking for opportunities there how about could best makes sense to grow that we are working on.
But a lot of Oems that send their products internationally, we're getting more and more exposure with that whereas before sometimes we just sell to Oems and then we get the tech call or request for a spare part down the road on and go Oh that would've gone international we're getting more and more requirements from international companies more one.
Forms coming in on the website.
Quest for some support or spare parts. So we know that our international business is growing but still not to a point, where it's it's worth to breakout we don't think.
Okay well.
That's interesting as well so.
With your efforts to expand.
Our business outside of the oil and gas industry.
Are you are you getting any.
Any business that is not oil and gas related internationally in other words, just landfill gas I don't.
No to what extent, that's actually done internationally, but.
It would seem that would be a complementary.
Business expansion opportunity.
Yeah, absolutely so far anything that is international that has to deal with.
Non traditional upstream business for profile has really been in that critical energy infrastructure space.
So bigger plants that deal with processing fifth facilities storage facilities, we've seen some of that.
In terms of some of the projects that we're working that are like.
Really greenfield for profile.
We talked about coal processing or.
Are you do you name it critical infrastructure surrounding like San Dryers asphalt drive fly Ash, we haven't seen any of that as of yet. We currently do not have a partner that we believe would support us outside of oil and gas and international space. It's it's part of the roadmap but for the for.
For the foreseeable future 2024, we're more focused in the back yard where we can support those projects with our technical team and even service support them because they are.
Different from a process perspective, they're not as plug and play as upstream oil and gas. So it's in our future Jon but right now the focus for non oil and gas ventures is definitely in North America.
Okay great.
Great. Thanks, very much for taking the questions and hope.
Hope to see you soon thanks.
Yeah. Thanks, John Thanks, John.
There are no further questions in the queue I would like to hand, the call back over to management for closing remarks.
Thank you everyone for joining us on our call today to discuss our fourth quarter and full year 2023 results, we'd like to thank all of you for your continued support.
Always we're available for any discussions or questions. You may have we look forward to speaking with you again, when we release our first quarter results in May.
Thank you and have a great day.
This concludes today's conference call you may disconnect. Your lines. Thank you for participating and have a pleasant day.
Yeah.
Mhm.
Hum.
Okay.
Yeah.
[noise].
Okay.
Yeah.
[music].
Yeah.
Okay.
Yes.