Flotek Industries CEO Ryan Ezell joins J.D. Durkin at the NYSE to discuss the company’s turnaround strategy, energy infrastructure demand, and how data analytics and chemistry are driving growth.
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J.D.: Time now to say hello to our third guest of the show, this is Ryan Ezell, the CEO of Flotek Industries. Not just an incredible guest, but the man himself who just rang the closing bell at the big board. How about that? Thanks for being here.
Ryan: I appreciate it. Exciting day today .
J.D.: Everyone in the world of business. looks at that closing bell and they're like, that's the dream for the Yankee Stadium of finance. What's it like to actually be up there and do the thing yourself?
Ryan: You know, it's hard to describe like for Flotek. Exciting day. We got out of a lot of our management staff here. Our board was here today. And and it truly represents the value that we've had to turn around this organization over the last six years and the trajectory we've got for a bright future at Flotek.
J.D.: So give me a bit of an introduction, first and foremost, for anyone watching who might not know what Flotek is all about, and then talk to me further about that turnaround strategy and some of the challenges that it's kind of taken to get here.
Ryan: Yes. For those that don't know Flotek, we are an innovative chemical and data analytics company that's built around using chemistry as a common value creation platform. And here what you've really seen, the emergence of Flotek on the scene in the last 2 to 3 years has been around our convergence of our real time data analytics and monitoring systems, combined with our advanced, innovative chemistry technologies that are improving transparency, operational efficiency and sustainability. Big, exciting piece we have on the data analytics side is around our custody transfer, digital evaluation and more recently, our gas conditioning for power generation, which is really exciting in the markets today, as you've seen, as a growth of power gen data centers, etc..
J.D.: I mean, I feel like almost every day that I'm doing the show, I'm saying of the very few sectors that are defiantly catching a bit right now, it's oil and energy stocks significantly outperforming the market. How can we get a quick shot of the board to show how the stock performed today, up 2.6% on the backdrop, Ryan, where the S&P is only up half a percent. That is strong outperformance. To what degree do you have to position yourselves against the macro economic backdrop, and how does that impact your work at Flotek?
Ryan: You know, it's very interesting for us. I think that we're going to be the tip of the spear for innovation. When you look at the electrification needs that we're going to have here in the United States in the coming future, and our ability to condition, monitor and measure natural gas and how we're going to evolve as an organization. are in the process of orchestrating an amazing industrialized pivot, and the future's going to be bright because we'll be that tip of the spear for bringing effective, costly, improved energy to the world. And we're excited about it not only domestically, but also what we're doing internationally.
J.D.: What are the needs of things like energy infrastructure that not enough people talk enough about?
Ryan: You know, I think it's a there's a couple of things I would look at in terms of one, we're just never really understanding these dramatic power demand requirements from data centers and AI. So that's a huge growth platform. But one thing people aren't even really paying attention to is just the total electrification needs across the U.S., because a lot of the infrastructure is at its end of life, and more than 50% of the transmission and other distribution lines are practically failing. And you see this when we have storms where we see dramatic surges on the system and our ability to bring power and monitoring components in these remote areas are going to be huge because we don't necessarily have all the gen sets, but we condition the gas that operates and produces the power to the generation at sites. And so it's a really exciting time for Flotek. And that's an industrial twist on, you know, what was conventionally an older oil and gas chemistry business that's quite evolved now.
J.D.: Yeah. What most excites you about that evolution, taking such an old legacy industry and saying, hey, it is ripe for some disruption in the best way possible?
Ryan: Well, you know, it's pros and cons for guys who can't train chemist by trade. It's a little bit heartbreaking to know that there the market values other things a little bit more exciting than just pure molecules. And so the transition that we've made of the way you make chemical businesses better as you monitor them in real time, you provide transparency on how chemistry reacts and how it impacts day to day life. And that's what we're doing here at Flotek, and we're really excited about that.
J.D.: Ryan Ezell, CEO of Flotek Industries a strong tape on this Monday. Thanks a lot for being here.
Ryan: Appreciate it. Thank you.