Company: TH
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001558370-25-010732
Chunk: 8

Company: Target Hospitality Corp.
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 3Q
Chunk 8
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Item 3.  Quantitative and Qualitative Disclosures about Market Risk

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Our principal market risks are our exposure to interest rates and commodity risks.

Interest Rates

We are exposed to interest rate risk through our ABL Facility, which is subject to the risk of higher interest charges associated with increases in interest rates. As of June 30, 2025, we had $24 million of outstanding floating-rate obligations under our credit facilities. These floating-rate obligations expose us to the risk of increased interest expense in the event of increases in short-term interest rates. If floating interest rates increased by 100 basis points, our consolidated interest expense would increase by approximately $0.2 million annually, based on our floating-rate debt obligations in effect as of June 30, 2025.

Commodity Risk

Commodity price fluctuations also indirectly influence our activities and results of operations over the long-term because they may affect production rates and investments by natural resource development companies in the development of commodity reserves.

We have limited direct exposure to risks associated with fluctuating commodity prices. However, both our profitability and our cash flows are affected by volatility in commodity prices. We do not currently hedge our exposure to commodity prices.

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