Calfrac Well Services Ltd.: Calfrac Reports Third-Quarter Adjusted EBITDA of $91.3 Million and Free Cash Flow of $48.1 Million

CALGARY, Alberta, Nov. 08, 2023 (GLOBE NEWSWIRE) -- Calfrac Well Services Ltd. ("Calfrac" or "the Company") (TSX: CFW) announces its financial and operating results for the three and nine months ended September 30, 2023. The following press release should be read in conjunction with the management's discussion and analysis and interim consolidated financial statements and notes thereto as at September 30, 2023. Readers should also refer to the "Forward-looking statements" legal advisory and the section regarding "Non-GAAP Measures" at the end of this press release. All financial amounts and measures are expressed in Canadian dollars unless otherwise indicated. Additional information about Calfrac is available on the SEDAR website at www.sedarplus.ca, including the Company's Annual Information Form for the year ended December 31, 2022.

CEO'S MESSAGE
Calfrac overcame lower than expected utilization in North America to make significant progress on its key strategic objectives during the third quarter. The Company leveraged its diverse geographic footprint in North America and Argentina to generate Adjusted EBITDA from continuing operations of $91.3 million. Calfrac's strong execution in the field combined with its disciplined approach to capital allocation resulted in the generation of $48.1 million of free cash flow during the quarter, which was used to strengthen its balance sheet through a $43.7 million reduction in net debt and the deployment of an additional nine Tier IV dynamic gas blend ("DGB") fracturing pumps. Consequently, Calfrac exited the third quarter of 2023 with a net debt to EBITDA ratio of 0.92 to 1, the lowest in recent history. This strong execution leaves the Company well-positioned to capitalize on the current oilfield services market up cycle. Calfrac is currently collaborating with its customers to optimize completions schedules and anticipates that steady utilization throughout next year will drive further improvements in financial performance.

Calfrac's Chief Executive Officer, Pat Powell commented: "The Calfrac team took additional steps towards accomplishing our long-term goals this quarter and I am excited about our future as we continue to execute on our brand promise to generate strong returns for our shareholders, reduce debt, and improve our asset quality in the field."

SELECT FINANCIAL HIGHLIGHTS - CONTINUING OPERATIONS

	Three Months Ended Sep. 30,							Nine Months Ended Sep. 30,
	2023		2022		Change			2023		2022		Change
(C$000s, except per share amounts)	($)		($)		(%)			($)		($)		(%)
(unaudited)			Revised (1)							Revised (1)
Revenue	483,093		438,338		10			1,442,879		1,051,373		37
Adjusted EBITDA(1)(2)(3)	91,286		94,289		(3	)		262,865		157,787		67
Consolidated cash flows provided by operating activities	101,264		13,753		636			160,350		38,694		314
Capital expenditures	50,825		24,745		105			116,017		52,130		123
Net income	97,523		45,352		115			184,367		20,546		797
Per share - basic	1.20		1.15		4			2.28		0.53		330
Per share - diluted	1.09		1.10		(1	)		2.12		0.53		300

As at	Sep. 30,		Dec. 31,		Change
	2023		2022
(C$000s)	($)		($)		(%)
(unaudited)
Cash and cash equivalents	23,308		8,498		174
Working capital, end of period	283,680		183,580		55
Total assets, end of period	1,178,071		995,753		18
Long-term debt, end of period	308,849		329,186		(6	)
Total consolidated equity, end of period	596,141		422,972		41

⁽¹⁾ Adjusted EBITDA reflects a change in definition and excludes all foreign exchange gains and losses.
⁽²⁾ Refer to "Non-GAAP Measures" on page 6 for further information.
⁽³⁾ Effective January 1, 2023, the Company recorded expenditures related to fluid end components as an operating expense rather than as a capital expenditure. This change in accounting estimate was recorded on a prospective basis.

During the quarter, Calfrac:

• generated revenue of $483.1 million, an increase of 10 percent from the third quarter in 2022 resulting primarily from higher activity in all operating divisions;
• reported third-quarter Adjusted EBITDA of $91.3 million, which included $11.9 million of maintenance expense related to fluid end components, versus $94.3 million in the third quarter of 2022 ($8.0 million of fluid end components capitalized);
• reported net income from continuing operations of $97.5 million or $1.09 per share diluted, which included a reversal of impairment of property, plant and equipment of $41.6 million and a deferred tax recovery of $9.0 million related to the improved business outlook in Canada, compared to net income of $45.4 million or $1.10 per share diluted during the third quarter in 2022;
• amended and restated its $250.0 million credit facilities, which included an extension of the maturity date to the earlier of July 1, 2026 or six months prior to the maturity of the Company's Second Lien Notes on March 15, 2026;
• reduced its net debt by $43.7 million, further reducing its Net Debt to EBITDA to 0.92:1:00;
• increased period-end working capital to $283.7 million from $183.6 million at December 31, 2022 due to a combination of higher revenue and geographical mix; and
• incurred capital expenditures from continuing operations of $50.8 million, which included approximately $33.2 million related to the Company's fracturing fleet modernization program.
  
  

FINANCIAL OVERVIEW - CONTINUING OPERATIONS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 VERSUS 2022

NORTH AMERICA

	Three Months Ended Sep. 30,							Nine Months Ended Sep. 30,
	2023		2022		Change			2023		2022		Change
(C$000s, except operational and exchange rate information)	($)		($)		(%)			($)		($)		(%)
(unaudited)
Revenue	401,291		374,157		7			1,190,660		879,021		35
Adjusted EBITDA(1)	83,023		91,491		(9	)		234,793		155,595		51
Adjusted EBITDA (%)	20.7		24.5		(16	)		19.7		17.7		11
Fracturing revenue per job ($)	43,633		44,832		(3	)		43,480		38,390		13
Number of fracturing jobs	8,870		8,092		10			26,472		22,025		20
Active pumping horsepower, end of period (000s)	1,035		871		19			1,035		871		19
US$/C$ average exchange rate(2)	1.3411		1.3056		3			1.3456		1.2830		5

⁽¹⁾ Refer to "Non-GAAP Measures" on page 6 for further information.
⁽²⁾ Source: Bank of Canada.

OUTLOOK
Calfrac benefited from the superior execution enabled by its centralized organizational structure in North America as it successfully navigated schedule gaps to generate one of its highest third-quarter Adjusted EBITDA margins since 2012. The Company increased the number of active Tier IV DGB units which are achieving significant diesel replacement rates. For the fourth quarter, the Company anticipates a decrease in activity across its operations in Canada driven by typical seasonality and customer budget exhaustion. However, Calfrac expects an increase in utilization across its United States operations due to the reallocation of customer capital programs from the third quarter to the fourth quarter stemming from recent strength in crude oil prices. Calfrac believes that its capital discipline and solid activity for its 15 fracturing fleets next year will support further fleet modernization investments and a continued reduction in long-term debt.

The industry-wide discipline demonstrated thus far in 2023 has been a welcome change compared to previous oilfield services cycles as companies idled underutilized equipment rather than sacrificing margins to gain market share. Calfrac expects similar fracturing activity across North America next year as operators maintain production. The Company believes that its strong customer relationships across all of its operating areas and growing fleet of next-generation fracturing equipment will drive improved shareholder returns over the long term.

THREE MONTHS ENDED SEPTEMBER 30, 2023 COMPARED TO THREE MONTHS ENDED SEPTEMBER 30, 2022

REVENUE
Revenue from Calfrac's North American operations increased to $401.3 million during the third quarter of 2023 from $374.2 million in the comparable quarter of 2022. The 7 percent increase in revenue was due to a 10 percent increase in the number of completed fracturing jobs, offset partially by a 3 percent period-over-period decrease in average job revenue. The increase in job count was mainly due to the Company operating 15 fracturing fleets during the quarter with more consistent utilization compared to an average of 13 operating fleets in the respective quarter of 2022. The slightly lower revenue per job was mainly a result of job mix as pricing remained relatively consistent with the same period in 2022. Coiled tubing revenue increased by 25 percent as compared to the third quarter in 2022 mainly due to higher utilization of Calfrac's six deep coiled tubing units. The 3 percent appreciation in the U.S. dollar also contributed to the higher reported revenue.

ADJUSTED EBITDA
The Company's operations in North America generated Adjusted EBITDA of $83.0 million or 21 percent of revenue during the third quarter of 2023 compared to $91.5 million or 24 percent of revenue in the same period in 2022. This decrease was primarily due to the change in accounting estimate that was adopted for fluid ends at the beginning of 2023. In the third quarter of 2023, Calfrac incurred $10.5 million of maintenance expense related to fluid end components versus $7.7 million of capital expenditures in the same quarter of 2022. However, utilization during the third quarter of 2023 was impacted by a reduction in activity, mainly in the United States, as a result of lower natural gas prices and lower crude oil prices during the second quarter of 2023, which resulted in the deferral of planned capital programs by some of the Company's clients.

NINE MONTHS ENDED SEPTEMBER 30, 2023 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30, 2022

REVENUE
Revenue from Calfrac's North American operations increased significantly to $1.2 billion during the first nine months of 2023 from $879.0 million in the comparable period of 2022. The 35 percent increase in revenue can be attributed to a 20 percent increase in the number of fracturing jobs completed combined with a 13 percent increase in revenue per job period-over-period. The increase in job count was mainly due to the Company operating 15 fleets during the period with more consistent utilization compared to an average of 13.5 operating fleets in the comparable period in 2022. The higher revenue per job was mainly the result of job mix and improved pricing. Coiled tubing revenue also increased by 21 percent as compared to the first nine months in 2022 due to increased utilization for its six crewed units.

ADJUSTED EBITDA
The Company's operations in North America generated Adjusted EBITDA of $234.8 million during the first nine months of 2023 compared to $155.6 million in the same period in 2022. This increase in Adjusted EBITDA was largely driven by higher utilization of its fracturing and coiled tubing crews. The Company generated an Adjusted EBITDA margin of 20 percent versus 18 percent in the comparable period in 2022 through higher utilization combined with better realized pricing. In 2023, Calfrac's Adjusted EBITDA included $26.3 million of maintenance expense related to fluid ends versus $18.1 million of capital expenditures that were recorded in the comparable period in 2022.

ARGENTINA

	Three Months Ended Sep. 30,							Nine Months Ended Sep. 30,
	2023		2022		Change			2023		2022		Change
(C$000s, except operational and exchange rate information)	($)		($)		(%)			($)		($)		(%)
(unaudited)
Revenue	81,802		64,181		27			252,219		172,352		46
Adjusted EBITDA(1)	14,331		8,706		65			43,623		16,363		167
Adjusted EBITDA (%)	17.5		13.6		29			17.3		9.5		82
Fracturing revenue per job ($)	78,634		84,843		(7	)		83,242		70,133		19
Number of fracturing jobs	582		471		24			1,784		1,415		26
Active pumping horsepower, end of period (000s)	139		140		(1	)		139		140		(1	)
US$/C$ average exchange rate(2)	1.3411		1.3056		3			1.3456		1.2830		5

⁽¹⁾ Refer to "Non-GAAP Measures" on page 6 for further information.
⁽²⁾ Source: Bank of Canada.

OUTLOOK
Calfrac's Argentina division continues to leverage its strong market position to produce significant year-over-year Adjusted EBITDA growth. The Company expects its recently demonstrated profitability to continue into the fourth quarter and throughout 2024 driven by robust utilization across all service lines in the Vaca Muerta shale play and the conventional basins of southern Argentina.

THREE MONTHS ENDED SEPTEMBER 30, 2023 COMPARED TO THREE MONTHS ENDED SEPTEMBER 30, 2022

REVENUE
Calfrac's Argentinean operations generated revenue of $81.8 million during the third quarter of 2023 versus $64.2 million in the comparable quarter in 2022 primarily due to higher activity across all service lines. The significant increase in revenue was due to the strategic repositioning of certain fracturing and cementing equipment from southern Argentina into the Vaca Muerta shale play during the first half of 2023. Coiled tubing revenue also increased due to an increase in overall activity with both existing and new customers.

ADJUSTED EBITDA
The Company's operations in Argentina generated Adjusted EBITDA of $14.3 million during the third quarter of 2023 compared to $8.7 million in the comparable quarter of 2022, while the Company's Adjusted EBITDA margins also improved to 18 percent from 14 percent. This improvement in Adjusted EBITDA was primarily due to the higher revenue base and changes in the Company's customer and geographic mix which resulted in higher profitability relative to the comparable period in 2022.

NINE MONTHS ENDED SEPTEMBER 30, 2023 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30, 2022

REVENUE
Calfrac's Argentinean operations generated revenue of $252.2 million during the first nine months of 2023 compared to $172.4 million in the comparable period in 2022. Activity in the Vaca Muerta shale play continued to increase while activity in southern Argentina also achieved significant growth compared to the first nine months of 2022. Overall fracturing activity increased by 26 percent compared to the first nine months in 2022 while revenue per job was 19 percent higher primarily due to overall inflation in operating costs and better pricing that commenced during the second half of 2022 combined with a stronger U.S. dollar. Higher coiled tubing and cementing revenue also contributed to the overall increase in revenue. The number of coiled tubing jobs increased by 32 percent as activity increased in Neuquén and southern Argentina while revenue per job was 6 percent higher primarily due to job mix and inflation. Cementing activity increased by 5 percent and revenue per job increased by 12 percent due to changes in job mix as a greater number of pre-fracturing projects, which are typically larger job sizes, were completed during the first nine months of 2023.

ADJUSTED EBITDA
The Company's operations in Argentina generated Adjusted EBITDA of $43.6 million or 17 percent of revenue during the first nine months in 2023 versus $16.4 million or 9 percent of revenue in the comparable period in 2022 primarily due to higher utilization and pricing across all service lines. Adjusted EBITDA in 2023 included $4.7 million of maintenance expense related to fluid end components that would have been recorded as capital expenditures in 2022.

CAPITAL EXPENDITURES

	Three Months Ended Sep. 30,							Nine Months Ended Sep. 30,
	2023		2022		Change			2023		2022		Change
(C$000s)	($)		($)		(%)			($)		($)		(%)
North America	47,463		21,943		116			108,041		46,289		133
Argentina	3,362		2,802		20			7,976		5,841		37
Continuing Operations	50,825		24,745		105			116,017		52,130		123

Capital expenditures were $50.8 million for the three months ended September 30, 2023 versus $24.7 million in the comparable period in 2022. Calfrac's Board of Directors have approved a 2023 capital budget of approximately $160.0 million, which excludes expenditures related to fluid end components as these have been recorded as maintenance expenses beginning in January 2023 for all continuing reporting segments. This change in accounting estimate was based on new information surrounding the useful life of these components.

SUMMARY OF QUARTERLY RESULTS - CONTINUING OPERATIONS

Three Months Ended	Dec. 31,			Mar. 31,			Jun. 30,			Sep. 30,		Dec. 31,		Mar. 31,		Jun. 30,		Sep. 30,
	2021			2022			2022			2022		2022		2023		2023		2023
(C$000s, except per share and operating data)	($)			($)			($)			($)		($)		($)		($)		($)
(unaudited)	Revised (1)			Revised (1)			Revised (1)			Revised (1)
Financial
Revenue	229,661			294,524			318,511			438,338		447,847		493,323		466,463		483,093
Adjusted EBITDA(1)(2)(3)	8,382			22,763			40,734			94,289		75,954		83,794		87,785		91,286
Net income (loss)	(29,132	)		(18,030	)		(6,776	)		45,352		14,757		36,313		50,531		97,523
Per share - basic	(0.77	)		(0.47	)		(0.18	)		1.15		0.27		0.45		0.62		1.20
Per share - diluted	(0.77	)		(0.47	)		(0.18	)		1.10		0.17		0.41		0.58		1.09
Capital expenditures(3)	14,868			12,145			15,240			24,745		35,810		34,474		30,718		50,825

⁽¹⁾ Adjusted EBITDA reflects a change in definition and excludes all foreign exchange gains and losses.
⁽²⁾ Refer to "Non-GAAP Measures" on page 6 for further information.
⁽³⁾ Effective January 1, 2023, recorded expenditures related to fluid end components as an operating expense rather than as a capital expenditure. This change in accounting estimate was recorded on a prospective basis.

NON-GAAP MEASURES

Certain supplementary measures presented in this press release do not have any standardized meaning under IFRS and, because IFRS have been incorporated as Canadian generally accepted accounting principles (GAAP), these supplementary measures are also non-GAAP measures. These measures have been described and presented to provide shareholders and potential investors with additional information regarding the Company's financial results, liquidity and ability to generate funds to finance its operations. These measures may not be comparable to similar measures presented by other entities, and are explained below.

Adjusted EBITDA is defined as net income or loss for the period less interest, taxes, depreciation and amortization, foreign exchange losses (gains), non-cash stock-based compensation, and gains and losses that are extraordinary or non-recurring. Adjusted EBITDA is presented because it gives an indication of the results from the Company's principal business activities prior to consideration of how its activities are financed and the impact of foreign exchange, taxation and depreciation and amortization charges. Adjusted EBITDA for the period was calculated as follows:

	Three Months Ended Sep. 30,						Nine Months Ended Sep. 30,
	2023			2022			2023			2022
(C$000s)	($)			($)			($)			($)
(unaudited)
Net income from continuing operations	97,523			45,352			184,367			20,546
Add back (deduct):
Depreciation	27,387			29,394			86,206			89,733
Foreign exchange losses (gains)(2)	1,415			(7,106	)		7,884			(6,704	)
(Gain) loss on disposal of property, plant and equipment	(706	)		(406	)		(5,667	)		4,382
Reversal of impairment of property, plant and equipment	(41,563	)		-			(41,563	)		-
Litigation settlements	-			8,258			(6,805	)		11,258
Restructuring charges	1,059			597			2,991			1,563
Stock-based compensation	1,469			366			2,810			2,319
Interest	7,262			10,804			23,023			31,537
Income taxes	(2,560	)		7,030			9,619			3,153
Adjusted EBITDA from continuing operations (1)	91,286			94,289			262,865			157,787

⁽¹⁾ For bank covenant purposes, EBITDA includes the deduction of an additional $9.3 million of lease payments for the nine months ended September 30, 2023 (nine months ended September 30, 2022 - $7.5 million) that would have been recorded as operating expenses prior to the adoption of IFRS 16.
⁽²⁾ Adjusted EBITDA reflects a change in definition effective October 1, 2022, and excludes all foreign exchange gains and losses.

The definition and calculation of the ratio of net debt to Adjusted EBITDA for the year ended December 31, 2022, is disclosed in Note 15 to the Company's year-end consolidated financial statements. The definition and calculation of this ratio for the twelve months ended September 30, 2023, is disclosed in Note 11 to the Company's interim financial statements for the corresponding period.

ADVISORIES
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements within the meaning of applicable securities laws. The use of any of the words "seek", "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "forecast" or similar words suggesting future outcomes, are forward-looking statements.

In particular, forward-looking statements in this press release include, but are not limited to, statements with respect to activity, demand, utilization and outlook for the Company's operating divisions in North America and Argentina; the supply and demand fundamentals of the pressure pumping industry; input costs, margin and service pricing trends and strategies; operating and financing strategies, performance, priorities, metrics and estimates, such as the Company's strategic priorities to maximize free cash flow, repay debt and capital investment plans, including the Company's fleet modernization plan and timing thereof; the Company's debt, liquidity and financial position; the Company's service quality and the Company's intentions and expectations with respect to the foregoing.

These statements are derived from certain assumptions and analyses made by the Company based on its experience and perception of historical trends, current conditions, expected future developments and other factors that it believes are appropriate in the circumstances, including, but not limited to, the economic and political environment in which the Company operates, including the current state and anticipated length of the pressure pumping market upcycle; the Company's expectations for its customers' capital budgets, demand for services and geographical areas of focus; the effect of unconventional oil and gas projects have had on supply and demand fundamentals for oil and natural gas; the effect of environmental factors on customer and investor preferences and capital deployment; the effect of the military conflict in the Ukraine and related international sanctions and counter-sanctions and restrictions by Russia on the Company's ownership and planned sale of the Russian division; industry equipment levels including the number of active fracturing fleets marketed by the Company's competitors and the timing of deployment of the Company's fleet upgrades; the Company's existing contracts and the status of current negotiations with key customers and suppliers; the continued effectiveness of cost reduction measures instituted by the Company; and the likelihood that the current tax and regulatory regime will remain substantially unchanged.

Forward-looking statements are subject to a number of known and unknown risks and uncertainties that could cause actual results to differ materially from the Company's expectations. Such risk factors include but are not limited to: (A) industry risks, including but not limited to, global economic conditions and the level of exploration, development and production for oil and natural gas in North America and Argentina; excess equipment levels; impacts of conservation measures and technological advances on the demand for the Company's services; hazards inherent in the industry; the actions of activist shareholders and the increasing reluctance of institutional investors to invest in the industry in which the Company operates; and an intensely competitive oilfield services industry; (B) business operations risks, including but not limited to, fleet reinvestment risk, including the ability of the Company to finance the capital necessary for equipment upgrades to support its operational needs while meeting government and customer requirements and preferences; difficulty retaining, replacing or adding personnel; failure to improve and adapt equipment, proprietary fluid chemistries and other products and services; reliance on equipment suppliers and fabricators for timely delivery and quality of equipment; a concentrated customer base; seasonal volatility and climate change; cybersecurity risks, and activism; (C) financial risks, including but not limited to, price escalation and availability of raw materials, diesel fuel and component parts; restrictions on the Company's access to capital, including the impacts of covenants under the Company's lending documents; direct and indirect exposure to volatile credit markets, including interest rate risk; fluctuations in currency exchange rates and increased inflation; actual results which are materially different from management estimates and assumptions; insufficient internal controls; and possible impacts on the Company's access to capital and common share price given a significant number of common shares are controlled by two directors of the Company; (D) geopolitical risks, including but not limited to, foreign operations exposure, including risks relating to unsettled political conditions, war, including the ongoing Russia and Ukraine conflict and any expansion of that conflict, foreign exchange rates and controls, and international trade and regulatory controls and sanctions; the impacts of a delay of sale or failure to sell the Company's discontinued operations in Russia, including failure to receive any applicable regulatory approvals and reputational risks; foreign legal actions and unknown consequences of such actions; and risk associated with compliance with applicable law; (E) legal and regulatory risks, including but not limited to, federal, provincial and state legislative and regulatory initiatives; health, safety and environmental laws and regulations; and legal and administrative proceedings; and (F) environmental, social and governance risks, including but not limited to, failure to effectively and timely address the energy transition; legal and regulatory initiatives to limit greenhouse gas emissions; and the direct and indirect costs of various existing and proposed climate change regulations. Further information about these and other risks and uncertainties are set forth in the Company's most recently filed Annual Information Form under the heading "Risk Factors" which is available on the SEDAR website at www.sedarplus.ca under Company's profile.

Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and there can be no assurance that actual results or developments anticipated by the Company will be realized, or that they will have the expected consequences or effects on the Company or its business or operations. These statements speak only as of the respective date of this press release or the document by reference herein. The Company assumes no obligation to update publicly any such forward-looking statements, whether as a result of new information, future events or otherwise, except as required pursuant to applicable securities laws.

BUSINESS RISKS
The business of Calfrac is subject to certain risks and uncertainties. Prior to making any investment decision regarding Calfrac, investors should carefully consider, among other things, the risk factors set forth in the Company's most recently filed Annual Information Form under the heading "Risk Factors" which is available on the SEDAR website at www.sedarplus.ca under the Company's profile. Copies of the Annual Information Form may also be obtained on request without charge from Calfrac at Suite 500, 407 - 8th Avenue S.W., Calgary, Alberta, Canada, T2P 1E5, or at www.calfrac.com.

ADDITIONAL INFORMATION
Calfrac's common shares and warrants are publicly traded on the Toronto Stock Exchange under the trading symbols "CFW" and "CFW.WT", respectively.

Calfrac provides specialized oilfield services to exploration and production companies designed to increase the production of hydrocarbons from wells with continuing operations focused throughout western Canada, the United States and Argentina. During the first quarter of 2022, management committed to a plan to sell the Company's Russian division, resulting in the associated assets and liabilities being classified as held for sale and presented in the Company's financial statements as discontinued operations. The results of the Company's discontinued operations are excluded from the discussion and figures presented above unless otherwise noted. See Note 3 to the Company's interim consolidated financial statements for the three and nine months ended September 30, 2023 and Note 4 to the Company's audited consolidated financial statements for the year ended December 31, 2022 for additional information on the Company's discontinued operations.

Further information regarding Calfrac Well Services Ltd., including the most recently filed Annual Information Form, can be accessed on the Company's website at www.calfrac.com or under the Company's public filings found at www.sedarplus.ca.

THIRD QUARTER CONFERENCE CALL
Calfrac will be conducting a conference call for interested analysts, brokers, investors and news media representatives to review its 2023 third-quarter results at 10:00 a.m. (Mountain Time) on Wednesday, November 8, 2023. To participate in the conference call, please register at the URL link below. Once registered, you will receive a dial-in number and a unique PIN, which will allow you to ask questions.

https://register.vevent.com/register/BI9b50099938704de9bce508123d789223

The call will also be webcast and can be accessed through the link below. A replay of the webcast call will also be available on Calfrac's website for at least 90 days.

https://edge.media-server.com/mmc/p/wga26h28

CONSOLIDATED BALANCE SHEETS

	September 30,		December 31,
	2023		2022
(C$000s) (unaudited)	($)		($)
ASSETS
Current assets
Cash and cash equivalents	23,308		8,498
Accounts receivable	331,429		238,769
Inventories	121,446		108,866
Prepaid expenses and deposits	14,476		12,297
	490,659		368,430
Assets classified as held for sale	30,932		45,940
	521,591		414,370
Non-current assets
Property, plant and equipment	604,386		543,475
Right-of-use assets	23,094		22,908
Deferred income tax assets	29,000		15,000
	656,480		581,383
Total assets	1,178,071		995,753
LIABILITIES AND EQUITY
Current liabilities
Accounts payable and accrued liabilities	189,408		171,603
Income taxes payable	4,492		964
Current portion of long-term debt	2,594		2,534
Current portion of lease obligations	10,485		9,749
	206,979		184,850
Liabilities directly associated with assets classified as held for sale	17,410		18,852
	224,389		203,702
Non-current liabilities
Long-term debt	308,849		329,186
Lease obligations	12,364		13,443
Deferred income tax liabilities	36,328		26,450
	357,541		369,079
Total liabilities	581,930		572,781
Capital stock	867,523		865,059
Conversion rights on convertible notes	212		212
Contributed surplus	72,629		70,141
Warrants	35,384		36,558
Accumulated deficit	(402,374	)	(580,544	)
Accumulated other comprehensive income	22,767		31,546
Total equity	596,141		422,972
Total liabilities and equity	1,178,071		995,753

CONSOLIDATED STATEMENTS OF OPERATIONS

	Three Months Ended Sep. 30,				Nine Months Ended Sep. 30,
	2023		2022		2023		2022
(C$000s, except per share data) (unaudited)	($)		($)		($)		($)
Revenue	483,093		438,338		1,442,879		1,051,373
Cost of sales	403,803		365,536		1,222,373		956,526
Gross profit	79,290		72,802		220,506		94,847
Expenses
Selling, general and administrative	17,919		17,128		42,843		41,933
Foreign exchange losses (gains)	1,415		(7,106	)	7,884		(6,704	)
(Gain) loss on disposal of property, plant and equipment	(706	)	(406	)	(5,667	)	4,382
Reversal of impairment of property, plant and equipment	(41,563	)	-		(41,563	)	-
Interest	7,262		10,804		23,023		31,537
	(15,673	)	20,420		26,520		71,148
Income before income tax	94,963		52,382		193,986		23,699
Income tax expense (recovery)
Current	3,240		1,647		13,747		2,633
Deferred	(5,800	)	5,383		(4,128	)	520
	(2,560	)	7,030		9,619		3,153
Net income from continuing operations	97,523		45,352		184,367		20,546
Net (loss) income from discontinued operations	(10,951	)	4,746		(6,197	)	(28,178	)
Net income (loss) for the period	86,572		50,098		178,170		(7,632	)
Earnings (loss) per share - basic
Continuing operations	1.20		1.15		2.28		0.53
Discontinued operations	(0.14	)	0.12		(0.08	)	(0.73	)
	1.07		1.27		2.20		(0.20	)
Earnings (loss) per share - diluted
Continuing operations	1.09		1.10		2.12		0.53
Discontinued operations	(0.14	)	0.10		(0.08	)	(0.73	)
	0.97		1.21		2.05		(0.07	)

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Three Months Ended Sep. 30,				Nine Months Ended Sep. 30,
	2023		2022		2023		2022
(C$000s) (unaudited)	($)		($)		($)		($)
CASH FLOWS PROVIDED BY (USED IN)
OPERATING ACTIVITIES
Net income (loss) for the period	86,572		50,098		178,170		(7,632	)
Adjusted for the following:
Depreciation	27,387		29,394		86,206		89,932
Stock-based compensation	1,469		366		2,810		2,319
Unrealized foreign exchange (gains) losses	(2,650	)	(9,629	)	724		(18,697	)
(Gain) loss on disposal of property, plant and equipment	(709	)	(409	)	(5,694	)	4,378
(Reversal of) impairment of property, plant and equipment	(41,024	)	-		(41,024	)	5,634
Impairment of inventory	985		1,201		3,677		28,749
Impairment of other assets	14,768		(2,312	)	17,454		7,336
Interest	7,171		10,801		22,841		31,534
Interest paid	(9,254	)	(13,229	)	(20,739	)	(27,693	)
Deferred income taxes	(5,800	)	5,383		(4,128	)	520
Changes in items of working capital	22,349		(57,911	)	(79,947	)	(77,686	)
Cash flows provided by operating activities	101,264		13,753		160,350		38,694
FINANCING ACTIVITIES
Bridge loan proceeds	-		-		-		15,000
Issuance of long-term debt, net of debt issuance costs	22,029		12,825		73,485		19,782
Bridge loan repayments	-		-		-		(15,000	)
Long-term debt repayments	(50,000	)	(15,000	)	(100,000	)	(15,000	)
Lease obligation principal repayments	(2,613	)	(2,328	)	(8,412	)	(6,587	)
Proceeds on issuance of common shares from the exercise of warrants and stock options	610		621		967		1,884
Cash flows (used in) provided by financing activities	(29,974	)	(3,882	)	(33,960	)	79
INVESTING ACTIVITIES
Purchase of property, plant and equipment	(50,121	)	(18,479	)	(128,447	)	(45,588	)
Proceeds on disposal of property, plant and equipment	695		882		22,383		1,657
Proceeds on disposal of right-of-use assets	138		716		1,247		1,627
Cash flows used in investing activities	(49,288	)	(16,881	)	(104,817	)	(42,304	)
Effect of exchange rate changes on cash and cash equivalents	1,841		7,388		(9,369	)	27,811
Increase in cash and cash equivalents	23,843		378		12,204		24,280
Cash and cash equivalents (bank overdraft), beginning of period	6,754		22,551		18,393		(1,351	)
Cash and cash equivalents, end of period	30,597		22,929		30,597		22,929
Included in the cash and cash equivalents per the balance sheet	23,308				23,308
Included in the assets held for sale/discontinued operations	7,289				7,289

For further information, please contact:

Pat Powell, Chief Executive Officer
Mike Olinek, Chief Financial Officer

Telephone: [phone]
www.calfrac.com