Canada's Source Energy Q4 adjusted EBITDA falls

Overview

• Canada frac sand producer's Q4 sand volumes rose 18% yr/yr

• Adjusted EBITDA for Q4 decreased compared to last year

Outlook

• Company anticipates incremental demand from Western Canadian LNG projects

• Source positioned to capitalize on increased demand in northeastern British Columbia

Result Drivers

• REBOUND IN ACTIVITY - Source Energy Services saw a rebound in customer activity levels, driving an 18% increase in sand volumes for Q4 2025 compared to Q4 2024

• COST INCREASES - Higher sand volumes and incremental costs at Peace River facility increased cost of sales in Q4 2025

• MARGIN PRESSURE - Adjusted Gross Margin per MT decreased due to integration issues at Peace River and adverse weather conditions

Company press release: ID:nACSFrZhra

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 1 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the construction materials peer group is "buy"

• Wall Street's median 12-month price target for Source Energy Services Ltd is C$17.75, about 0.8% above its February 26 closing price of C$17.90

• The stock recently traded at 5 times the next 12-month earnings vs. a P/E of 3 three months ago

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.