Natural Gas Services Group, Inc. reported its financial results for the first quarter of 2025, revealing a total revenue of $41.4 million, a 12.7% increase from $36.9 million in the same period of 2024. The company's rental revenue, which constitutes the majority of its income, rose by 15.3% to $38.9 million, driven by an increase in rented horsepower. However, net income decreased to $4.9 million, down from $5.1 million year-over-year, resulting in diluted earnings per share of $0.38 compared to $0.41 in the prior year.
The financial performance reflects several operational changes, including a strategic shift towards higher horsepower units, which command better rental rates. The company reported a total of 492,679 horsepower rented as of March 31, 2025, compared to 444,220 horsepower a year earlier. Despite this growth, the number of customers under contract decreased from 80 to 67, attributed to consolidation within the exploration and production industry. The overall utilization rate for horsepower remained stable at 81.7%, slightly down from 81.9% in the previous year.
In terms of expenses, total operating costs increased to $31.9 million from $27.6 million, primarily due to higher costs associated with supporting a larger quantity of utilized horsepower and inflationary pressures. Selling, general, and administrative expenses also rose by 14.4% to $5.4 million, reflecting increased staffing and IT support costs. The company recorded a notable increase in depreciation and amortization expenses, which rose to $8.6 million from $7.1 million, largely due to the expansion of its high horsepower fleet.
Natural Gas Services Group continues to focus on enhancing its operational efficiency and expanding its market presence. The company has made significant investments in rental equipment, totaling $19.3 million in the first quarter, compared to $10.9 million in the same period last year. The company’s credit facility was amended to increase borrowing capacity to $400 million, providing additional financial flexibility for future capital expenditures. Looking ahead, the company anticipates continued demand for its services, contingent on stable oil and gas prices, and plans to maintain a disciplined approach to capital management and operational improvements.
About NATURAL GAS SERVICES GROUP INC
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