Oil States Announces Third Quarter 2024 Results
-
Net loss of
$14 .3 million, or$0 .23 per share, reported for the quarter, which included restructuring and other charges totaling$18 .2 million ($17 .0 million, after-tax, or$0.27 per share) -
Adjusted net income of
$2 .7 million, or$0.04 per share, excluding these restructuring and other charges (a non-GAAP measure(1)) -
Consolidated revenues of
$174 .3 million decreased 6% sequentially, driven primarily by lowerU.S. land-based activity and transitory project delays in theGulf of Mexico -
Adjusted EBITDA (a non-GAAP measure(1)) of
$21 .5 million increased 1% sequentially - Well Site Services segment name changed to the Completion and Production Services segment following the sale of its remaining drilling rigs and exit of its flowback and well testing service offering
-
Generated cash flows from operations of
$28 .8 million - Purchased $3 million of our common stock
-
Board of Directors approved a new $50 million common stock repurchase authorization, which expires in
October 2026
|
Three Months Ended |
|
% Change |
||||||||||||||
(Unaudited, In Thousands, Except Per Share Amounts) |
|
|
|
|
|
|
Sequential |
|
Year-over-Year |
||||||||
Consolidated results: |
|
|
|
|
|
|
|
|
|
||||||||
Revenues |
$ |
174,348 |
|
|
$ |
186,383 |
|
|
$ |
194,289 |
|
|
(6 |
)% |
|
(10 |
)% |
Operating income (loss)(3) |
$ |
(11,041 |
) |
|
$ |
2,045 |
|
|
$ |
6,190 |
|
|
n.m. |
|
n.m. |
||
Net income (loss) |
$ |
(14,349 |
) |
|
$ |
1,301 |
|
|
$ |
4,212 |
|
|
n.m. |
|
n.m. |
||
Adjusted net income, excluding charges and credits(1) |
$ |
2,696 |
|
|
$ |
4,391 |
|
|
$ |
5,515 |
|
|
(39 |
)% |
|
(51 |
)% |
Adjusted EBITDA(1) |
$ |
21,531 |
|
|
$ |
21,306 |
|
|
$ |
23,441 |
|
|
1 |
% |
|
(8 |
)% |
|
|
|
|
|
|
|
|
|
|
||||||||
Revenues by segment(2): |
|
|
|
|
|
|
|
|
|
||||||||
Offshore Manufactured Products |
$ |
102,234 |
|
|
$ |
101,556 |
|
|
$ |
96,070 |
|
|
1 |
% |
|
6 |
% |
Completion and Production Services |
|
40,099 |
|
|
|
46,421 |
|
|
|
59,831 |
|
|
(14 |
)% |
|
(33 |
)% |
Downhole Technologies |
|
32,015 |
|
|
|
38,406 |
|
|
|
38,388 |
|
|
(17 |
)% |
|
(17 |
)% |
|
|
|
|
|
|
|
|
|
|
||||||||
Revenues by destination: |
|
|
|
|
|
|
|
|
|
||||||||
Offshore and international |
$ |
113,856 |
|
|
$ |
118,625 |
|
|
$ |
104,750 |
|
|
(4 |
)% |
|
9 |
% |
|
|
60,492 |
|
|
|
67,758 |
|
|
|
89,539 |
|
|
(11 |
)% |
|
(32 |
)% |
|
|
|
|
|
|
|
|
|
|
||||||||
Operating income (loss) by segment(2)(3): |
|
|
|
|
|
|
|
|
|
||||||||
Offshore Manufactured Products |
$ |
19,310 |
|
|
$ |
14,357 |
|
|
$ |
15,586 |
|
|
34 |
% |
|
24 |
% |
Completion and Production Services |
|
(18,267 |
) |
|
|
(535 |
) |
|
|
3,285 |
|
|
n.m. |
|
n.m. |
||
Downhole Technologies |
|
(3,653 |
) |
|
|
(1,141 |
) |
|
|
(1,900 |
) |
|
(220 |
)% |
|
(92 |
)% |
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted Segment EBITDA(1)(2): |
|
|
|
|
|
|
|
|
|
||||||||
Offshore Manufactured Products |
$ |
23,303 |
|
|
$ |
20,131 |
|
|
$ |
21,708 |
|
|
16 |
% |
|
7 |
% |
Completion and Production Services |
|
5,413 |
|
|
|
8,548 |
|
|
|
9,716 |
|
|
(37 |
)% |
|
(44 |
)% |
Downhole Technologies |
|
1,078 |
|
|
|
3,114 |
|
|
|
2,646 |
|
|
(65 |
)% |
|
(59 |
)% |
___________________ |
||
(1) |
|
These are non-GAAP measures. See “Reconciliations of GAAP to Non-GAAP Financial Information” tables below for reconciliations to their most comparable GAAP measures as well as further clarification and explanation. |
(2) |
|
In first quarter 2024, certain short-cycle, consumable product operations historically reported within the Offshore Manufactured Products segment were integrated into the Downhole Technologies segment. Historical segment financial data, backlog and other information were conformed with the revised segment presentation. |
(3) |
|
Operating income (loss) included intangible and operating lease asset impairment, facility consolidation and closure, patent defense and other charges totaling: |
Oil States’ President and Chief Executive Officer,
“Our third quarter 2024 results were led by offshore and international project activity and associated backlog conversion, partially offset by transitory customer delays in completion and intervention projects in the
“Our Offshore Manufactured Products segment revenues were flat sequentially, totaling
“Given the highly cyclical nature of select
Business Segment Results
In first quarter 2024, certain short-cycle, consumable product operations historically reported within the Offshore Manufactured Products segment (legacy frac plugs and elastomer products) were integrated into our Downhole Technologies segment to better align with the underlying activity demand drivers and current segment management structure, as well as provide for additional operational synergies. Historical segment financial data (GAAP and non-GAAP), backlog and other information were conformed with the revised segment presentation. Additionally, following the sale of its remaining
(See Segment Data and Adjusted Segment EBITDA tables below)
Offshore Manufactured Products
Offshore Manufactured Products reported revenues of
The segment’s reported operating income in the third and second quarters of 2024 included costs of
Backlog totaled
Completion and Production Services
Completion and Production Services reported revenues of
During the third quarter of 2024, the segment implemented restructuring actions in its
The segment’s
Downhole Technologies
Downhole Technologies reported revenues of
During the third quarter of 2024, the segment implemented actions to reduce costs and improve future operating margins, which included the exit of an underperforming location as well as reductions in its
Corporate
Corporate operating expenses in the third quarter of 2024 totaled
Interest Expense, Net
Net interest expense totaled
Income Taxes
During the third quarter of 2024, the Company recognized tax expense of
Cash Flows
During the third quarter of 2024, cash flows provided by operations totaled
The Company purchased
Financial Condition
Cash on-hand totaled
Conference Call Information
The call is scheduled for
About
For more information on the Company, please visit Oil States International’s website at www.oilstatesintl.com.
Cautionary Language Concerning Forward Looking Statements
The foregoing contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are those that do not state historical facts and are, therefore, inherently subject to risks and uncertainties. The forward-looking statements included herein are based on current expectations and entail various risks and uncertainties that could cause actual results to differ materially from those forward-looking statements. Such risks and uncertainties include, among others, the level of supply and demand for oil and natural gas, fluctuations in the current and future prices of oil and natural gas, the level of exploration, drilling and completion activity, general global economic conditions, the cyclical nature of the oil and natural gas industry, geopolitical conflicts and tensions, the financial health of our customers, the actions of the
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CONSOLIDATED STATEMENTS OF OPERATIONS (In Thousands, Except Per Share Amounts) (Unaudited) |
|||||||||||||||||||
|
|||||||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues: |
|
|
|
|
|
|
|
|
|
||||||||||
Products |
$ |
100,798 |
|
|
$ |
108,579 |
|
|
$ |
102,636 |
|
|
$ |
303,706 |
|
|
$ |
295,106 |
|
Services |
|
73,550 |
|
|
|
77,804 |
|
|
|
91,653 |
|
|
|
224,287 |
|
|
|
278,911 |
|
|
|
174,348 |
|
|
|
186,383 |
|
|
|
194,289 |
|
|
|
527,993 |
|
|
|
574,017 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Costs and expenses: |
|
|
|
|
|
|
|
|
|
||||||||||
Product costs |
|
79,167 |
|
|
|
82,503 |
|
|
|
80,188 |
|
|
|
236,807 |
|
|
|
231,524 |
|
Service costs |
|
57,422 |
|
|
|
59,530 |
|
|
|
70,239 |
|
|
|
173,766 |
|
|
|
211,668 |
|
Cost of revenues (exclusive of depreciation and amortization expense presented below) |
|
136,589 |
|
|
|
142,033 |
|
|
|
150,427 |
|
|
|
410,573 |
|
|
|
443,192 |
|
Selling, general and administrative expense |
|
22,754 |
|
|
|
26,373 |
|
|
|
24,241 |
|
|
|
71,623 |
|
|
|
71,785 |
|
Depreciation and amortization expense |
|
13,635 |
|
|
|
14,698 |
|
|
|
15,416 |
|
|
|
42,528 |
|
|
|
46,209 |
|
Impairment of goodwill |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
10,000 |
|
|
|
— |
|
Impairments of intangible assets |
|
10,787 |
|
|
|
— |
|
|
|
— |
|
|
|
10,787 |
|
|
|
— |
|
Impairments of operating lease assets |
|
2,579 |
|
|
|
— |
|
|
|
— |
|
|
|
2,579 |
|
|
|
— |
|
Other operating (income) expense, net |
|
(955 |
) |
|
|
1,234 |
|
|
|
(1,985 |
) |
|
|
76 |
|
|
|
(2,503 |
) |
|
|
185,389 |
|
|
|
184,338 |
|
|
|
188,099 |
|
|
|
548,166 |
|
|
|
558,683 |
|
Operating income (loss) |
|
(11,041 |
) |
|
|
2,045 |
|
|
|
6,190 |
|
|
|
(20,173 |
) |
|
|
15,334 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net |
|
(1,824 |
) |
|
|
(2,061 |
) |
|
|
(1,928 |
) |
|
|
(5,986 |
) |
|
|
(6,378 |
) |
Other income, net |
|
731 |
|
|
|
652 |
|
|
|
186 |
|
|
|
1,311 |
|
|
|
672 |
|
Income (loss) before income taxes |
|
(12,134 |
) |
|
|
636 |
|
|
|
4,448 |
|
|
|
(24,848 |
) |
|
|
9,628 |
|
Income tax benefit (provision) |
|
(2,215 |
) |
|
|
665 |
|
|
|
(236 |
) |
|
|
(1,574 |
) |
|
|
(2,700 |
) |
Net income (loss) |
$ |
(14,349 |
) |
|
$ |
1,301 |
|
|
$ |
4,212 |
|
|
$ |
(26,422 |
) |
|
$ |
6,928 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) per share: |
|
|
|
|
|
|
|
|
|
||||||||||
Basic |
$ |
(0.23 |
) |
|
$ |
0.02 |
|
|
$ |
0.07 |
|
|
$ |
(0.42 |
) |
|
$ |
0.11 |
|
Diluted |
|
(0.23 |
) |
|
|
0.02 |
|
|
|
0.07 |
|
|
|
(0.42 |
) |
|
|
0.11 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average number of common shares outstanding: |
|
|
|
|
|
|
|
|
|||||||||||
Basic |
|
62,084 |
|
|
|
62,483 |
|
|
|
62,651 |
|
|
|
62,357 |
|
|
|
62,760 |
|
Diluted |
|
62,084 |
|
|
|
62,704 |
|
|
|
63,060 |
|
|
|
62,357 |
|
|
|
63,135 |
|
|
|||||||
|
|||||||
CONSOLIDATED BALANCE SHEETS (In Thousands) |
|||||||
|
|||||||
|
|
|
|
||||
|
(Unaudited) |
|
|
||||
ASSETS |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
45,984 |
|
|
$ |
47,111 |
|
Accounts receivable, net |
|
182,536 |
|
|
|
203,211 |
|
Inventories, net |
|
221,134 |
|
|
|
202,027 |
|
Prepaid expenses and other current assets |
|
29,257 |
|
|
|
35,648 |
|
Total current assets |
|
478,911 |
|
|
|
487,997 |
|
|
|
|
|
||||
Property, plant, and equipment, net |
|
267,388 |
|
|
|
280,389 |
|
Operating lease assets, net |
|
21,601 |
|
|
|
21,970 |
|
|
|
70,439 |
|
|
|
79,867 |
|
Other intangible assets, net |
|
129,866 |
|
|
|
153,010 |
|
Other noncurrent assets |
|
25,936 |
|
|
|
23,253 |
|
Total assets |
$ |
994,141 |
|
|
$ |
1,046,486 |
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Current portion of long-term debt |
$ |
634 |
|
|
$ |
627 |
|
Accounts payable |
|
55,506 |
|
|
|
67,546 |
|
Accrued liabilities |
|
39,978 |
|
|
|
44,227 |
|
Current operating lease liabilities |
|
7,295 |
|
|
|
6,880 |
|
Income taxes payable |
|
2,616 |
|
|
|
1,233 |
|
Deferred revenue |
|
34,742 |
|
|
|
36,757 |
|
Total current liabilities |
|
140,771 |
|
|
|
157,270 |
|
|
|
|
|
||||
Long-term debt |
|
124,643 |
|
|
|
135,502 |
|
Long-term operating lease liabilities |
|
19,392 |
|
|
|
18,346 |
|
Deferred income taxes |
|
5,291 |
|
|
|
7,717 |
|
Other noncurrent liabilities |
|
19,238 |
|
|
|
18,106 |
|
Total liabilities |
|
309,335 |
|
|
|
336,941 |
|
|
|
|
|
||||
Stockholders’ equity: |
|
|
|
||||
Common stock |
|
786 |
|
|
|
772 |
|
Additional paid-in capital |
|
1,135,634 |
|
|
|
1,129,240 |
|
Retained earnings |
|
258,496 |
|
|
|
284,918 |
|
Accumulated other comprehensive loss |
|
(66,595 |
) |
|
|
(69,984 |
) |
|
|
(643,515 |
) |
|
|
(635,401 |
) |
Total stockholders’ equity |
|
684,806 |
|
|
|
709,545 |
|
Total liabilities and stockholders’ equity |
$ |
994,141 |
|
|
$ |
1,046,486 |
|
|
|||||||
|
|||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands) (Unaudited) |
|||||||
|
|||||||
|
Nine Months Ended |
||||||
|
|
2024 |
|
|
|
2023 |
|
Cash flows from operating activities: |
|
|
|
||||
Net income (loss) |
$ |
(26,422 |
) |
|
$ |
6,928 |
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization expense |
|
42,528 |
|
|
|
46,209 |
|
Impairment of goodwill |
|
10,000 |
|
|
|
— |
|
Impairments of intangible assets |
|
10,787 |
|
|
|
— |
|
Impairments of operating lease assets |
|
2,579 |
|
|
|
— |
|
Stock-based compensation expense |
|
6,408 |
|
|
|
5,157 |
|
Amortization of deferred financing costs |
|
1,168 |
|
|
|
1,344 |
|
Deferred income tax benefit |
|
(2,798 |
) |
|
|
(66 |
) |
Gains on disposals of assets |
|
(2,956 |
) |
|
|
(3,335 |
) |
Gains on extinguishment of 4.75% convertible senior notes |
|
(515 |
) |
|
|
— |
|
Other, net |
|
83 |
|
|
|
(614 |
) |
Changes in operating assets and liabilities: |
|
|
|
||||
Accounts receivable |
|
21,173 |
|
|
|
29,538 |
|
Inventories |
|
(18,406 |
) |
|
|
(23,754 |
) |
Accounts payable and accrued liabilities |
|
(17,554 |
) |
|
|
(17,515 |
) |
Deferred revenue |
|
(2,015 |
) |
|
|
5,580 |
|
Other operating assets and liabilities, net |
|
3,624 |
|
|
|
2,905 |
|
Net cash flows provided by operating activities |
|
27,684 |
|
|
|
52,377 |
|
|
|
|
|
||||
Cash flows from investing activities: |
|
|
|
||||
Capital expenditures |
|
(23,309 |
) |
|
|
(23,370 |
) |
Proceeds from disposition of property and equipment |
|
15,411 |
|
|
|
4,374 |
|
Other, net |
|
(431 |
) |
|
|
(120 |
) |
Net cash flows used in investing activities |
|
(8,329 |
) |
|
|
(19,116 |
) |
|
|
|
|
||||
Cash flows from financing activities: |
|
|
|
||||
Revolving credit facility borrowings |
|
22,678 |
|
|
|
35,693 |
|
Revolving credit facility repayments |
|
(22,678 |
) |
|
|
(35,693 |
) |
Purchases of 4.75% convertible senior notes |
|
(10,846 |
) |
|
|
— |
|
Repayment of 1.50% convertible senior notes |
|
— |
|
|
|
(17,315 |
) |
Other debt and finance lease repayments |
|
(481 |
) |
|
|
(340 |
) |
Payment of financing costs |
|
(1,119 |
) |
|
|
(101 |
) |
Purchases of treasury stock |
|
(5,149 |
) |
|
|
(3,001 |
) |
Shares added to treasury stock as a result of net share settlements due to vesting of stock awards |
|
(2,596 |
) |
|
|
(1,948 |
) |
Net cash flows used in financing activities |
|
(20,191 |
) |
|
|
(22,705 |
) |
|
|
|
|
||||
Effect of exchange rate changes on cash and cash equivalents |
|
(291 |
) |
|
|
330 |
|
Net change in cash and cash equivalents |
|
(1,127 |
) |
|
|
10,886 |
|
Cash and cash equivalents, beginning of period |
|
47,111 |
|
|
|
42,018 |
|
Cash and cash equivalents, end of period |
$ |
45,984 |
|
|
$ |
52,904 |
|
|
|
|
|
||||
Cash paid (received) for: |
|
|
|
||||
Interest |
$ |
4,206 |
|
|
$ |
4,353 |
|
Income taxes, net |
|
2,695 |
|
|
|
(34 |
) |
|
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|
|||||||||||||||||||
SEGMENT DATA (In Thousands) (Unaudited) |
|||||||||||||||||||
|
|||||||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues(1): |
|
|
|
|
|
|
|
|
|
||||||||||
Offshore Manufactured Products |
|
|
|
|
|
|
|
|
|
||||||||||
Project-driven: |
|
|
|
|
|
|
|
|
|
||||||||||
Products |
$ |
58,164 |
|
|
$ |
59,752 |
|
|
$ |
58,169 |
|
|
$ |
171,053 |
|
|
$ |
152,241 |
|
Services |
|
32,754 |
|
|
|
31,024 |
|
|
|
30,391 |
|
|
|
89,011 |
|
|
|
79,867 |
|
|
|
90,918 |
|
|
|
90,776 |
|
|
|
88,560 |
|
|
|
260,064 |
|
|
|
232,108 |
|
Military and other products |
|
11,316 |
|
|
|
10,780 |
|
|
|
7,510 |
|
|
|
30,583 |
|
|
|
23,114 |
|
Total Offshore Manufactured Products |
|
102,234 |
|
|
|
101,556 |
|
|
|
96,070 |
|
|
|
290,647 |
|
|
|
255,222 |
|
Completion and Production Services |
|
40,099 |
|
|
|
46,421 |
|
|
|
59,831 |
|
|
|
133,812 |
|
|
|
191,425 |
|
Downhole Technologies |
|
32,015 |
|
|
|
38,406 |
|
|
|
38,388 |
|
|
|
103,534 |
|
|
|
127,370 |
|
Total revenues |
$ |
174,348 |
|
|
$ |
186,383 |
|
|
$ |
194,289 |
|
|
$ |
527,993 |
|
|
$ |
574,017 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income (loss)(1): |
|
|
|
|
|
|
|
|
|
||||||||||
Offshore Manufactured Products(2) |
$ |
19,310 |
|
|
$ |
14,357 |
|
|
$ |
15,586 |
|
|
$ |
44,270 |
|
|
$ |
32,122 |
|
Completion and Production Services(3) |
|
(18,267 |
) |
|
|
(535 |
) |
|
|
3,285 |
|
|
|
(19,221 |
) |
|
|
14,983 |
|
Downhole Technologies(4) |
|
(3,653 |
) |
|
|
(1,141 |
) |
|
|
(1,900 |
) |
|
|
(16,873 |
) |
|
|
(148 |
) |
Corporate |
|
(8,431 |
) |
|
|
(10,636 |
) |
|
|
(10,781 |
) |
|
|
(28,349 |
) |
|
|
(31,623 |
) |
Total operating income (loss) |
$ |
(11,041 |
) |
|
$ |
2,045 |
|
|
$ |
6,190 |
|
|
$ |
(20,173 |
) |
|
$ |
15,334 |
|
___________________ |
||
(1) |
|
In the first quarter 2024, certain short-cycle, consumable product operations historically reported within the Offshore Manufactured Products segment were integrated into the Downhole Technologies segment. Historical segment financial results were conformed with the revised segment presentation. Additionally, following the sale of its remaining |
(2) |
|
Operating income for the three months ended |
(3) |
|
Operating income (loss) for the three months ended |
(4) |
|
Operating loss for the nine months ended |
|
|||||||||||||||||
|
|||||||||||||||||
RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL INFORMATION ADJUSTED EBITDA (A) (In Thousands) (Unaudited) |
|||||||||||||||||
|
|||||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) |
$ |
(14,349 |
) |
|
$ |
1,301 |
|
|
$ |
4,212 |
|
$ |
(26,422 |
) |
|
$ |
6,928 |
Interest expense, net |
|
1,824 |
|
|
|
2,061 |
|
|
|
1,928 |
|
|
5,986 |
|
|
|
6,378 |
Income tax provision (benefit) |
|
2,215 |
|
|
|
(665 |
) |
|
|
236 |
|
|
1,574 |
|
|
|
2,700 |
Depreciation and amortization expense |
|
13,635 |
|
|
|
14,698 |
|
|
|
15,416 |
|
|
42,528 |
|
|
|
46,209 |
Impairment of goodwill |
|
— |
|
|
|
— |
|
|
|
— |
|
|
10,000 |
|
|
|
— |
Impairments of intangible assets |
|
10,787 |
|
|
|
— |
|
|
|
— |
|
|
10,787 |
|
|
|
— |
Impairments of operating lease assets |
|
2,579 |
|
|
|
— |
|
|
|
— |
|
|
2,579 |
|
|
|
— |
Facility consolidation/closure and other charges |
|
4,840 |
|
|
|
4,426 |
|
|
|
1,649 |
|
|
11,775 |
|
|
|
1,649 |
Gains on extinguishment of 4.75% convertible senior notes |
|
— |
|
|
|
(515 |
) |
|
|
— |
|
|
(515 |
) |
|
|
— |
Adjusted EBITDA |
$ |
21,531 |
|
|
$ |
21,306 |
|
|
$ |
23,441 |
|
$ |
58,292 |
|
|
$ |
63,864 |
________________ |
||
(A) |
|
The term Adjusted EBITDA consists of net income (loss) plus net interest expense, taxes, depreciation and amortization expense, impairments of goodwill, intangible and operating lease assets, and facility consolidation/closure and other charges, less gains on extinguishment of 4.75% convertible senior notes (“2026 Notes”). Adjusted EBITDA is not a measure of financial performance under generally accepted accounting principles (“GAAP”) and should not be considered in isolation from or as a substitute for net income (loss) or cash flow measures prepared in accordance with GAAP or as a measure of profitability or liquidity. Additionally, Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. The Company has included Adjusted EBITDA as a supplemental disclosure because its management believes that Adjusted EBITDA provides useful information regarding its ability to service debt and to fund capital expenditures and provides investors a helpful measure for comparing its operating performance with the performance of other companies that have different financing and capital structures or tax rates. The Company uses Adjusted EBITDA to compare and to monitor the performance of the Company and its business segments to other comparable public companies and as a benchmark for the award of incentive compensation under its annual incentive compensation plan. The table above sets forth reconciliations of Adjusted EBITDA to net income (loss), which is the most directly comparable measure of financial performance calculated under GAAP. |
|
|||||||||||||||||||
|
|||||||||||||||||||
RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL INFORMATION ADJUSTED SEGMENT EBITDA (B) (In Thousands) (Unaudited) |
|||||||||||||||||||
|
|||||||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Offshore Manufactured Products: |
|
|
|
|
|
|
|
|
|
||||||||||
Operating income |
$ |
19,310 |
|
|
$ |
14,357 |
|
|
$ |
15,586 |
|
|
$ |
44,270 |
|
|
$ |
32,122 |
|
Other income (expense), net |
|
8 |
|
|
|
(20 |
) |
|
|
68 |
|
|
|
29 |
|
|
|
314 |
|
Depreciation and amortization expense |
|
3,631 |
|
|
|
4,247 |
|
|
|
4,405 |
|
|
|
11,571 |
|
|
|
12,555 |
|
Facility consolidation/closure and other charges |
|
354 |
|
|
|
1,547 |
|
|
|
1,649 |
|
|
|
3,364 |
|
|
|
1,649 |
|
Adjusted Segment EBITDA |
$ |
23,303 |
|
|
$ |
20,131 |
|
|
$ |
21,708 |
|
|
$ |
59,234 |
|
|
$ |
46,640 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Completion and Production Services: |
|
|
|
|
|
|
|
|
|
||||||||||
Operating income (loss) |
$ |
(18,267 |
) |
|
$ |
(535 |
) |
|
$ |
3,285 |
|
|
$ |
(19,221 |
) |
|
$ |
14,983 |
|
Other income, net |
|
723 |
|
|
|
157 |
|
|
|
118 |
|
|
|
767 |
|
|
|
358 |
|
Depreciation and amortization expense |
|
5,749 |
|
|
|
6,047 |
|
|
|
6,313 |
|
|
|
17,875 |
|
|
|
19,023 |
|
Impairments of intangible assets |
|
10,787 |
|
|
|
— |
|
|
|
— |
|
|
|
10,787 |
|
|
|
— |
|
Impairments of operating lease assets |
|
2,092 |
|
|
|
— |
|
|
|
— |
|
|
|
2,092 |
|
|
|
— |
|
Facility consolidation/closure and other charges |
|
4,329 |
|
|
|
2,879 |
|
|
|
— |
|
|
|
8,254 |
|
|
|
— |
|
Adjusted Segment EBITDA |
$ |
5,413 |
|
|
$ |
8,548 |
|
|
$ |
9,716 |
|
|
$ |
20,554 |
|
|
$ |
34,364 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Downhole Technologies: |
|
|
|
|
|
|
|
|
|
||||||||||
Operating loss |
$ |
(3,653 |
) |
|
$ |
(1,141 |
) |
|
$ |
(1,900 |
) |
|
$ |
(16,873 |
) |
|
$ |
(148 |
) |
Depreciation and amortization expense |
|
4,121 |
|
|
|
4,255 |
|
|
|
4,546 |
|
|
|
12,646 |
|
|
|
14,161 |
|
Impairment of goodwill |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
10,000 |
|
|
|
— |
|
Impairments of operating lease assets |
|
487 |
|
|
|
— |
|
|
|
487 |
|
|
|
487 |
|
|
|
— |
|
Facility consolidation/closure and other charges |
|
123 |
|
|
|
— |
|
|
|
— |
|
|
|
123 |
|
|
|
— |
|
Adjusted Segment EBITDA |
$ |
1,078 |
|
|
$ |
3,114 |
|
|
$ |
2,646 |
|
|
$ |
6,383 |
|
|
$ |
14,013 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Corporate: |
|
|
|
|
|
|
|
|
|
||||||||||
Operating loss |
$ |
(8,431 |
) |
|
$ |
(10,636 |
) |
|
$ |
(10,781 |
) |
|
$ |
(28,349 |
) |
|
$ |
(31,623 |
) |
Other income, net |
|
— |
|
|
|
515 |
|
|
|
— |
|
|
|
515 |
|
|
|
— |
|
Depreciation and amortization expense |
|
134 |
|
|
|
149 |
|
|
|
152 |
|
|
|
436 |
|
|
|
470 |
|
Other charges |
|
34 |
|
|
|
— |
|
|
|
— |
|
|
|
34 |
|
|
|
— |
|
Gains on extinguishment of 4.75% convertible senior notes |
|
— |
|
|
|
(515 |
) |
|
|
— |
|
|
|
(515 |
) |
|
|
— |
|
Adjusted Segment EBITDA |
$ |
(8,263 |
) |
|
$ |
(10,487 |
) |
|
$ |
(10,629 |
) |
|
$ |
(27,879 |
) |
|
$ |
(31,153 |
) |
________________ |
||
(B) |
|
The term Adjusted Segment EBITDA consists of operating income (loss) plus other income (expense), depreciation and amortization expense, impairments of goodwill, intangible and operating lease assets, and facility consolidation/closure and other charges, less gains on extinguishment of 2026 Notes. Adjusted Segment EBITDA is not a measure of financial performance under GAAP and should not be considered in isolation from or as a substitute for operating income (loss) or cash flow measures prepared in accordance with GAAP or as a measure of profitability or liquidity. Additionally, Adjusted Segment EBITDA may not be comparable to other similarly titled measures of other companies. The Company has included Adjusted Segment EBITDA as supplemental disclosure because its management believes that Adjusted Segment EBITDA provides useful information regarding its ability to service debt and to fund capital expenditures and provides investors a helpful measure for comparing its operating performance with the performance of other companies that have different financing and capital structures or tax rates. The Company uses Adjusted Segment EBITDA to compare and to monitor the performance of its business segments to other comparable public companies and as a benchmark for the award of incentive compensation under its annual incentive compensation plan. The table above sets forth reconciliations of Adjusted Segment EBITDA to operating income (loss), which is the most directly comparable measure of financial performance calculated under GAAP. |
|
|||||||||||||||||||
|
|||||||||||||||||||
RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL INFORMATION ADJUSTED NET INCOME (LOSS), EXCLUDING CHARGES AND CREDITS (C) AND ADJUSTED NET INCOME (LOSS) PER SHARE, EXCLUDING CHARGES AND CREDITS (D) (In Thousands, Except Per Share Amounts) (Unaudited) |
|||||||||||||||||||
|
|
|
|
||||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) |
$ |
(14,349 |
) |
|
$ |
1,301 |
|
|
$ |
4,212 |
|
|
$ |
(26,422 |
) |
|
$ |
6,928 |
|
Impairment of goodwill |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
10,000 |
|
|
|
— |
|
Impairments of intangible assets |
|
10,787 |
|
|
|
— |
|
|
|
— |
|
|
|
10,787 |
|
|
|
— |
|
Impairments of operating lease assets |
|
2,579 |
|
|
|
— |
|
|
|
— |
|
|
|
2,579 |
|
|
|
— |
|
Facility consolidation/closure and other charges |
|
4,840 |
|
|
|
4,426 |
|
|
|
1,649 |
|
|
|
11,775 |
|
|
|
1,649 |
|
Gains on extinguishment of 4.75% convertible senior notes |
|
— |
|
|
|
(515 |
) |
|
|
— |
|
|
|
(515 |
) |
|
|
— |
|
Total adjustments, before taxes |
|
18,206 |
|
|
|
3,911 |
|
|
|
1,649 |
|
|
|
34,626 |
|
|
|
1,649 |
|
Tax benefit |
|
(1,161 |
) |
|
|
(821 |
) |
|
|
(346 |
) |
|
|
(2,990 |
) |
|
|
(346 |
) |
Total adjustments, net of taxes |
|
17,045 |
|
|
|
3,090 |
|
|
|
1,303 |
|
|
|
31,636 |
|
|
|
1,303 |
|
Adjusted net income, excluding charges and credits |
$ |
2,696 |
|
|
$ |
4,391 |
|
|
$ |
5,515 |
|
|
$ |
5,214 |
|
|
$ |
8,231 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted weighted average number of diluted common shares outstanding (E) |
|
62,412 |
|
|
|
62,704 |
|
|
|
63,060 |
|
|
|
62,648 |
|
|
|
63,135 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted diluted net income per share, excluding charges and credits (E) |
$ |
0.04 |
|
|
$ |
0.07 |
|
|
$ |
0.09 |
|
|
$ |
0.08 |
|
|
$ |
0.13 |
|
___________________ |
|
(C) |
Adjusted net income, excluding charges and credits consists of net income (loss) plus impairments of goodwill, intangible and operating lease assets, and facility consolidation/closure and other charges, less gains on extinguishment of the 2026 Notes. Adjusted net income, excluding charges and credits is not a measure of financial performance under GAAP and should not be considered in isolation from or as a substitute for net income (loss) as prepared in accordance with GAAP. The Company has included adjusted net income, excluding charges and credits as a supplemental disclosure because its management believes that adjusted net income, excluding charges and credits provides investors a helpful measure for comparing its operating performance with previous and subsequent periods. |
(D) |
Adjusted net income per share, excluding charges and credits is calculated as adjusted net income, excluding charges and credits divided by the weighted average number of common shares outstanding. Adjusted net income per share, excluding charges and credits is not a measure of financial performance under GAAP and should not be considered in isolation from or as a substitute for net income (loss) per share as prepared in accordance with GAAP. The Company has included adjusted net income per share, excluding charges and credits as a supplemental disclosure because its management believes that adjusted net income per share, excluding charges and credits provides investors a helpful measure for comparing its operating performance with previous and subsequent periods. |
(E) |
The calculation of diluted adjusted earnings per share for the three and nine months ended |
View source version on businesswire.com: https://www.businesswire.com/news/home/20241030426442/en/
Executive Vice President, Chief Financial Officer and Treasurer
(713) 652-0582
Source: