Stephen Gengaro's questions to DMC Global Inc (BOOM) leadership • Q4 2024
Question
Stephen Gengaro of Stifel asked about DynaEnergetics' expected performance and margin trajectory in a flat U.S. completions market, the company's view on normalized mid-cycle EBITDA margins for DynaEnergetics and Arcadia, and any significant sequential business drivers between segments in Q1.
Answer
Interim CEO James O'Leary responded that any margin improvement at DynaEnergetics would stem from internal 'self-help' initiatives rather than market uplift, with overall company margins likely remaining in the high single digits. He reiterated his belief that at mid-cycle, Arcadia should achieve mid-teens EBITDA margins and DynaEnergetics could reach low double-digit margins. He cited significant tariff-related uncertainty as a reason for providing flat Q1 guidance.