THE WOODLANDS, Texas, Aug. 8, 2016 /PRNewswire/ -- TETRA Technologies, Inc. (NYSE:TTI) (TETRA or the Company) today announced a consolidated second quarter 2016 net loss per share attributable to TETRA stockholders of $(0.32), which compares to earnings of $0.19 in the second quarter of 2015.
TETRA's adjusted per share results attributable to TETRA stockholders for the second quarter of 2016, excluding Maritech and other charges, were a loss of $(0.15), which compares to adjusted diluted earnings per share attributable to TETRA stockholders of $0.17 in the second quarter of 2015, also excluding Maritech and other charges. Second quarter 2016 revenue of $175.7 million declined 44% from the second quarter of 2015 primarily as a result of a 50% reduction in the North American rig count. (Adjusted diluted earnings (loss) per share is a non-GAAP financial measure that is reconciled to the nearest GAAP measure in the accompanying schedules.)
|
Second Quarter 2016 Results | |||||||||||
|
Three Months Ended | |||||||||||
|
June 30, 2016 |
March 31, 2016 |
June 30, 2015 | |||||||||
|
(In Thousands, Except per Share Amounts) | |||||||||||
|
Revenue |
$ |
175,660 |
$ |
169,329 |
$ |
316,319 |
|||||
|
Net income (loss) attributable to TETRA stockholders |
(26,574) |
(88,325) |
14,925 |
||||||||
|
Adjusted EBITDA(1) |
32,949 |
19,424 |
74,542 |
||||||||
|
Diluted EPS attributable to TETRA stockholders |
(0.32) |
(1.11) |
0.19 |
||||||||
|
Adjusted diluted EPS attributable to TETRA stockholders(1) |
(0.15) |
(0.24) |
0.17 |
||||||||
|
Consolidated net cash provided by operating activities |
8,336 |
25,261 |
54,347 |
||||||||
|
TETRA only adjusted free cash flow(1) |
$ |
(8,773) |
$ |
18,488 |
$ |
42,868 |
|||||
|
(1) |
Non-GAAP financial measures are reconciled to GAAP in the schedules below. |
Highlights of the 2016 second quarter include:
- Completion of public equity offering, raising $60 million in net proceeds to repay outstanding debt.
- Amendment of credit facility and debt agreements, providing enhanced financial flexibility.
- For our Compression Division, net cash provided by operating activities was $20.5 million, loss before tax was $(4.0) million, and adjusted EBITDA(1) was $24.7 million.
- A growing backlog in our Offshore Services segment as we exited the second quarter.
- Continued aggressive reduction of expenses across the company, including salary reductions and reduced workweek schedules.
(1) Non-GAAP financial measures are reconciled to GAAP in the schedules below.
Analysis of Second Quarter Results
Stuart M. Brightman, TETRA's President and Chief Executive Officer, stated, "During the second quarter of 2016, most of our markets continued to experience a decline in activity and high levels of competitiveness. Even with this unfavorable environment, our results improved sequentially, compared to the first quarter of 2016, as a result of seasonal improvements in several of our businesses combined with the ongoing positive impact of cost reductions.
"Also during the second quarter we completed a public equity offering, raising $60 million in net proceeds that were used primarily to repay outstanding debt, and we successfully negotiated the amendment of our primary debt agreements, providing us with enhanced financial flexibility. These two actions represent important steps for our long-term success, as they strengthen our balance sheet, provide additional liquidity, and better position us to respond rapidly when activity levels rebound.
"Our Fluids Division's revenues for the second quarter of 2016 were $60.8 million compared to $123.0 million in the second quarter of 2015. Similar to what we saw in the first quarter of this year, the decrease was predominately the result of continued lower demand in North America, a lack of major projects in the Gulf of Mexico, and continued pricing pressure in many international markets. Our seasonal increase in activity in the European chemical business somewhat mitigated this trend. Overall, this resulted in pretax income of $0.4 million and adjusted pretax income of $1.0 million for the Fluids Division in the second quarter of 2016, compared to pretax income of $32.6 million and adjusted pretax income of $32.8 million in the second quarter of 2015. Going forward into the second half of this year, our expectations for the Fluids Division are that we will see slightly improved activity in North America and an increase in offshore activity associated with projects currently in our backlog.
"Second quarter 2016 results for our Production Testing Division represent a sequential decrease from the first quarter of 2016, with a pretax loss of $(4.3) million and an adjusted pretax loss of $(4.2) million in this year's second quarter compared to a pretax loss of $(19.3) million and an adjusted pretax loss of $(2.3) million in this year's first quarter. Similar to the Fluids Division, this was driven primarily by a continued reduction in activity in North America and in certain international markets. Also similar to the Fluids Division, we expect to see a slight increase in activity for Production Testing in the second half of this year with a modest increase in completions activity.
"For the second quarter of 2016 our Compression Division reported a pretax loss of $(4.0) million and an adjusted pretax loss of $(3.1) million compared to a pretax loss of $(104.7) million and an adjusted pretax loss of $(4.3) million in the first quarter of 2016. During the second quarter, the Division experienced a continued decrease in utilization of our compression services and a continued reduction in equipment sales. Adjusted EBITDA of $24.7 million for the second quarter of this year represented an improvement over adjusted EBITDA of $23.6 million in the first quarter of this year, primarily due to the continued benefit of cost reduction actions. On July 22, 2016, CSI Compressco LP declared a distribution attributable to the second quarter of 2016 of $0.3775 per unit, unchanged from the distribution attributable to the first quarter of this year. This distribution resulted in a coverage ratio of 1.19x for the second quarter of 2016.
"Our Offshore Service segment reported pretax income of $37,000 and adjusted pretax income of $93,000 in the second quarter of 2016 compared to pretax income of $2.1 million in the second quarter of 2015. The segment's improvement on a sequential basis, compared to the pretax loss of $(7.7) million reported in the first quarter of 2016, is due to the normal seasonal activity of the second quarter. In addition, the backlog for our major assets continued to firm-up during the second quarter, and we expect the third quarter to show a typical seasonal improvement over the second quarter, sequentially."
Special Charges and Maritech
Maritech reported a pre-tax loss of $(3.4) million in the second quarter of 2016. The primary contributor to this loss was the write-off of a receivable of $2.8 million associated with the uncertainty of our ability to collect future reimbursements for P&A work performed on certain Maritech properties.
Financial Guidance
Given the operating environment and expectations of a prolonged downturn, the management team remains focused on adjusted free cash flow. The forecast for full year 2016 TETRA only adjusted free cash flow is a range of $30 to $50 million. No reconciliation of the forecasted range of adjusted free cash flow for the full year 2016 is included in this release because the reconciliation would require presenting forecasted information for CSI Compressco that is not publicly disclosed.
Conference Call
TETRA will host a conference call to discuss second quarter 2016 results today, August 8, 2016, at 10:30 am ET. The phone number for the call is (888) 347-5303. The conference will also be available by live audio webcast and may be accessed through TETRA's website at www.tetratec.com.
Financial Statements, Schedules and Non-GAAP Reconciliation Schedules (Unaudited)
Schedule A: Consolidated Income Statement
Schedule B: Financial Results By Segment
Schedule C: Consolidated Balance Sheet
Schedule D: Long-Term Debt
Schedule E: Second Quarter Special Charges
Schedule F: Non-GAAP Reconciliation to GAAP Financials
Schedule G: Non-GAAP Reconciliation to Adjusted Free Cash Flow
Schedule H: Non-GAAP Reconciliation of TETRA Net Debt
Company Overview and Forward Looking Statements
TETRA is a geographically diversified oil and gas services company, focused on completion fluids and associated products and services, water management, frac flowback, production well testing, offshore rig cooling, compression services and equipment, and selected offshore services including well plugging and abandonment, decommissioning, and diving. TETRA owns an equity interest, including all of the general partner interest, in CSI Compressco LP (NADAQ:CCLP), a master limited partnership.
This press release includes certain statements that are deemed to be forward-looking statements. Generally, the use of words such as "may," "expect," "intend," "estimate," "projects," "anticipate," "believe," "assume," "could," "should," "plans," "targets" or similar expressions that convey the uncertainty of future events, activities, expectations or outcomes identify forward-looking statements that the Company intends to be included within the safe harbor protections provided by the federal securities laws. These forward-looking statements include statements concerning expected results of operational business segments for 2016, anticipated benefits from CSI Compressco following the acquisition of CSI in 2014, including increases in cash distributions per unit, projections concerning the Company's business activities, financial guidance, estimated earnings, earnings per share, and statements regarding the Company's beliefs, expectations, plans, goals, future events and performance, and other statements that are not purely historical. These forward-looking statements are based on certain assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Such statements are subject to a number of risks and uncertainties, many of which are beyond the control of the Company, including the ability of CSI Compressco to successfully integrate the operations of CSI and recognize the anticipated benefits of the acquisition. Investors are cautioned that any such statements are not guarantees of future performances or results and that actual results or developments may differ materially from those projected in the forward-looking statements. Some of the factors that could affect actual results are described in the section titled "Risk Factors" contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2015, as well as other risks identified from time to time in its reports on Form 10-Q and Form 8-K filed with the Securities and Exchange Commission.
|
Schedule A: Consolidated Income Statement (Unaudited) | |||||||||||||||
|
Three Months Ended |
Six Months Ended | ||||||||||||||
|
2016 |
2015 |
2016 |
2015 | ||||||||||||
|
(In Thousands) | |||||||||||||||
|
Revenues |
$ |
175,660 |
$ |
316,319 |
$ |
344,989 |
$ |
567,411 |
|||||||
|
Cost of sales, services, and rentals |
125,593 |
207,391 |
246,034 |
374,054 |
|||||||||||
|
Depreciation, amortization, and accretion |
33,538 |
39,067 |
67,145 |
77,410 |
|||||||||||
|
Impairments of long-lived assets |
257 |
— |
10,927 |
— |
|||||||||||
|
Total cost of revenues |
159,388 |
246,458 |
324,106 |
451,464 |
|||||||||||
|
Gross profit |
16,272 |
69,861 |
20,883 |
115,947 |
|||||||||||
|
General and administrative expense |
27,181 |
37,472 |
60,792 |
72,741 |
|||||||||||
|
Goodwill impairment |
— |
— |
106,205 |
— |
|||||||||||
|
Interest expense, net |
14,335 |
13,319 |
28,974 |
27,035 |
|||||||||||
|
Other (income) expense, net |
2,210 |
962 |
1,506 |
118 |
|||||||||||
|
Income (loss) before taxes |
(27,454) |
18,108 |
(176,594) |
16,053 |
|||||||||||
|
Provision (benefit) for income taxes |
1,770 |
2,741 |
361 |
4,310 |
|||||||||||
|
Net income (loss) |
(29,224) |
15,367 |
(176,955) |
11,743 |
|||||||||||
|
Net (income) loss attributable to noncontrolling interest |
2,650 |
(442) |
62,056 |
(1,266) |
|||||||||||
|
Net income (loss) attributable to TETRA stockholders |
$ |
(26,574) |
$ |
14,925 |
$ |
(114,899) |
$ |
10,477 |
|||||||
|
Basic per share information: |
|||||||||||||||
|
Net income (loss) attributable to TETRA stockholders |
$ |
(0.32) |
$ |
0.19 |
$ |
(1.42) |
$ |
0.13 |
|||||||
|
Weighted average shares outstanding |
81,842 |
79,165 |
80,631 |
79,037 |
|||||||||||
|
Diluted per share information: |
|||||||||||||||
|
Net income (loss) attributable to TETRA stockholders |
$ |
(0.32) |
$ |
0.19 |
$ |
(1.42) |
$ |
0.13 |
|||||||
|
Weighted average shares outstanding |
81,842 |
79,915 |
80,631 |
79,506 |
|||||||||||
|
Schedule B: Financial Results By Segment (Unaudited) | |||||||||||||||
|
Three Months Ended |
Six Months Ended | ||||||||||||||
|
2016 |
2015 |
2016 |
2015 | ||||||||||||
|
(In Thousands) | |||||||||||||||
|
Revenues by segment: |
|||||||||||||||
|
Fluids Division |
$ |
60,833 |
$ |
122,974 |
$ |
119,946 |
$ |
222,263 |
|||||||
|
Production Testing Division |
13,384 |
34,842 |
33,255 |
71,943 |
|||||||||||
|
Compression Division |
76,091 |
126,455 |
157,786 |
229,344 |
|||||||||||
|
Offshore Division |
|||||||||||||||
|
Offshore Services |
26,119 |
35,731 |
36,365 |
47,514 |
|||||||||||
|
Maritech |
248 |
394 |
337 |
1,900 |
|||||||||||
|
Intersegment eliminations |
7 |
(2,909) |
(516) |
(3,180) |
|||||||||||
|
Offshore Division total |
26,374 |
33,216 |
36,186 |
46,234 |
|||||||||||
|
Eliminations and other |
(1,022) |
(1,168) |
(2,184) |
(2,373) |
|||||||||||
|
Total revenues |
$ |
175,660 |
$ |
316,319 |
$ |
344,989 |
$ |
567,411 |
|||||||
|
Gross profit (loss) by segment: |
|||||||||||||||
|
Fluids Division |
$ |
6,585 |
$ |
40,355 |
$ |
14,076 |
$ |
65,720 |
|||||||
|
Production Testing Division |
(2,598) |
3,918 |
(6,022) |
6,777 |
|||||||||||
|
Compression Division |
13,727 |
21,150 |
20,682 |
43,937 |
|||||||||||
|
Offshore Division |
|||||||||||||||
|
Offshore Services |
1,767 |
4,691 |
(4,222) |
(1,279) |
|||||||||||
|
Maritech |
(3,097) |
2 |
(3,412) |
1,301 |
|||||||||||
|
Intersegment eliminations |
— |
— |
— |
— |
|||||||||||
|
Offshore Division total |
(1,330) |
4,693 |
(7,634) |
22 |
|||||||||||
|
Corporate overhead and eliminations |
(112) |
(255) |
(219) |
(509) |
|||||||||||
|
Total gross profit |
$ |
16,272 |
$ |
69,861 |
$ |
20,883 |
$ |
115,947 |
|||||||
|
Income (loss) before taxes by segment: |
|||||||||||||||
|
Fluids Division |
$ |
454 |
$ |
32,583 |
$ |
96 |
$ |
50,320 |
|||||||
|
Production Testing Division |
(4,328) |
(472) |
(23,702) |
(433) |
|||||||||||
|
Compression Division |
(4,040) |
1,498 |
(108,740) |
3,904 |
|||||||||||
|
Offshore Division |
|||||||||||||||
|
Offshore Services |
37 |
2,095 |
(7,671) |
(6,553) |
|||||||||||
|
Maritech |
(3,401) |
(313) |
(4,021) |
662 |
|||||||||||
|
Intersegment eliminations |
— |
— |
— |
— |
|||||||||||
|
Offshore Division total |
(3,364) |
1,782 |
(11,692) |
(5,891) |
|||||||||||
|
Corporate overhead and eliminations |
(16,176) |
(17,283) |
(32,556) |
(31,847) |
|||||||||||
|
Total income (loss) before taxes |
$ |
(27,454) |
$ |
18,108 |
$ |
(176,594) |
$ |
16,053 |
|||||||
|
Please note that the above results by Segment are inclusive of the special charges and expenses. Please see Schedule E for details of those special charges and expenses. |
|
Schedule C: Consolidated Balance Sheet (Unaudited) | |||||||
|
June 30, 2016 |
December 31, 2015 | ||||||
|
(In Thousands) | |||||||
|
Balance Sheet: |
|||||||
|
Cash (excluding restricted cash) |
$ |
23,917 |
$ |
23,057 |
|||
|
Accounts receivable, net |
110,685 |
184,172 |
|||||
|
Inventories |
124,315 |
117,009 |
|||||
|
Other current assets |
28,753 |
29,791 |
|||||
|
PP&E, net |
1,000,169 |
1,048,004 |
|||||
|
Other assets |
98,584 |
234,169 |
|||||
|
Total assets |
$ |
1,386,423 |
$ |
1,636,202 |
|||
|
Current portion of decommissioning liabilities |
$ |
3,291 |
$ |
14,570 |
|||
|
Other current liabilities |
128,139 |
170,676 |
|||||
|
Long-term debt (1) |
788,222 |
853,228 |
|||||
|
Long-term portion of decommissioning liabilities |
51,732 |
42,879 |
|||||
|
Other long-term liabilities |
27,255 |
40,669 |
|||||
|
Equity |
387,784 |
514,180 |
|||||
|
Total liabilities and equity |
$ |
1,386,423 |
$ |
1,636,202 |
|||
|
(1) |
Please see Schedule D for the individual debt obligations of TETRA and CSI Compressco LP. |
|
Schedule D: Long-Term Debt | |
|
TETRA Technologies Inc. and its subsidiaries, excluding CSI Compressco LP and its subsidiaries, are obligated under a bank credit agreement and senior notes, neither of which are obligations of CSI Compressco LP and its subsidiaries. CSI Compressco LP and its subsidiaries are obligated under a separate bank credit agreement and senior notes, neither of which are obligations of TETRA and its other subsidiaries. Amounts presented are net of deferred financing costs. |
|
June 30, 2016 |
December 31, 2015 | ||||||
|
(In Thousands) | |||||||
|
TETRA |
|||||||
|
Bank revolving line of credit facility |
$ |
101,604 |
$ |
21,572 |
|||
|
TETRA Senior Notes at various rates |
117,446 |
264,998 |
|||||
|
Other debt |
— |
50 |
|||||
|
TETRA total debt |
219,050 |
286,620 |
|||||
|
Less current portion |
— |
(50) |
|||||
|
TETRA total long-term debt |
$ |
219,050 |
$ |
286,570 |
|||
|
CSI Compressco LP |
|||||||
|
CCLP Bank Credit Facility |
$ |
231,171 |
$ |
229,555 |
|||
|
CCLP 7.25% Senior Notes |
338,001 |
337,103 |
|||||
|
CCLP total debt |
569,172 |
566,658 |
|||||
|
Less current portion |
— |
— |
|||||
|
CCLP total long-term debt |
$ |
569,172 |
$ |
566,658 |
|||
|
Consolidated total long-term debt |
$ |
788,222 |
$ |
853,228 |
|||
Non-GAAP Financial Measures
In addition to financial results determined in accordance with GAAP, this press release includes the following non-GAAP financial measures for the Company: net debt, adjusted consolidated and segment income (loss) before taxes, excluding the Maritech segment and special charges; adjusted EBITDA; and adjusted free cash flow. The following schedules provide reconciliations of these non-GAAP financial measures to their most directly comparable GAAP measures. The non-GAAP financial measures should be considered in addition to, not as a substitute for, financial measures prepared in accordance with GAAP, as more fully discussed in the Company's financial statements and filings with the Securities and Exchange Commission.
Management believes that following the sale of essentially all of Maritech's oil and gas properties, it is helpful to show the Company's results excluding the impact of the costs and charges relating to the decommissioning of Maritech's remaining properties since these results will show the Company's historical results of operations on a basis consistent with expected future operations. Management also believes that the exclusion of the special charges from the historical results of operations enables management to evaluate more effectively the Company's operations over the prior periods and to identify operating trends that could be obscured by the excluded items.
Adjusted income (loss) before taxes (and adjusted income (loss) before taxes as a percent of revenue) is defined as the Company's (or its Segments') income (loss) before taxes excluding certain special or other charges (or credits). Adjusted income (loss) before taxes (and adjusted income (loss) before taxes as a percent of revenue) is used by management as a supplemental financial measure to assess financial performance, without regard to charges or credits that are considered by management to be outside of its normal operations.
Adjusted diluted earnings (loss) per share is defined as the Company's diluted earnings (loss) per share excluding certain special or other charges (or credits) and using a normalized effective income tax rate. Adjusted diluted earnings (loss) per share is used by management as a supplemental financial measure to assess financial performance, without regard to charges or credits that are considered by management to be outside of its normal operations.
Adjusted EBITDA is defined as adjusted income before interest, taxes, depreciation, amortization, impairments and special charges, and equity compensation. Adjusted EBITDA is used by management as a supplemental financial measure to assess the financial performance of the Company's assets, without regard to financing methods, capital structure or historical cost basis and to assess the Company's ability to incur and service debt and fund capital expenditures.
TETRA only adjusted free cash flow is a non-GAAP measure that the Company defines as cash from TETRA's operations, excluding cash settlements of Maritech AROs, less capital expenditures net of sales proceeds, and including cash distributions to TETRA from CSI Compressco LP. Management uses this supplemental financial measure to:
- assess the Company's ability to retire debt;
- evaluate the capacity of the Company to further invest and grow; and
- to measure the performance of the Company as compared to its peer group of companies.
TETRA only adjusted free cash flow does not necessarily imply residual cash flow available for discretionary expenditures, as it excludes cash requirements for debt service or other non-discretionary expenditures that are not deducted.
TETRA net debt is defined as the sum of long-term and short-term debt on its consolidated balance sheet, less cash, excluding restricted cash on the consolidated balance sheet and excluding the debt and cash of CSI Compressco LP. Management views TETRA net debt as a measure of TETRA's ability to reduce debt, add to cash balances, pay dividends, repurchase stock, and fund investing and financing activities.
|
Schedule E: Second Quarter Special Charges | |||||||||||||||
|
Three Months Ended | |||||||||||||||
|
June 30, 2016 | |||||||||||||||
|
Income |
Provision |
Noncont. |
Net Income |
EPS | |||||||||||
|
(In Thousands, Except per Share Amounts) | |||||||||||||||
|
Income (loss) attributable to TETRA stockholders, excluding unusual charges and Maritech |
$ |
(20,511) |
$ |
(6,154) |
$ |
(2,011) |
$ |
(12,346) |
$ |
(0.15) |
|||||
|
Asset impairments and writeoffs |
(365) |
(109) |
— |
(256) |
0.00 |
||||||||||
|
Severance expense |
(595) |
(179) |
(170) |
(246) |
0.00 |
||||||||||
|
Debt refinancing cost |
(2,582) |
(775) |
(469) |
(1,338) |
(0.02) |
||||||||||
|
Effect of deferred tax valuation allowance and other related tax adj. |
— |
8,987 |
— |
(8,987) |
(0.11) |
||||||||||
|
Maritech profit (loss) |
(3,401) |
— |
— |
(3,401) |
(0.04) |
||||||||||
|
Net income (loss) attributable to TETRA stockholders, as reported |
$ |
(27,454) |
$ |
1,770 |
$ |
(2,650) |
$ |
(26,574) |
$ |
(0.32) |
|||||
|
March 31, 2016 | |||||||||||||||
|
Income |
Provision |
Noncont. |
Net Income |
EPS | |||||||||||
|
Income (loss) attributable to TETRA stockholders, excluding unusual charges and Maritech |
$ |
(30,890) |
$ |
(9,266) |
$ |
(2,391) |
$ |
(19,233) |
$ |
(0.24) |
|||||
|
Asset impairments and writeoffs |
(10,670) |
(3,201) |
(4,465) |
(3,004) |
(0.04) |
||||||||||
|
Severance expense |
(755) |
(226) |
(138) |
(391) |
0.00 |
||||||||||
|
Goodwill writeoff |
(106,205) |
(31,862) |
(52,412) |
(21,931) |
(0.28) |
||||||||||
|
Effect of deferred tax valuation allowance and other related tax adj. |
— |
43,146 |
— |
(43,146) |
(0.54) |
||||||||||
|
Maritech profit (loss) |
(620) |
— |
— |
(620) |
(0.01) |
||||||||||
|
Net Income (loss) attributable to TETRA stockholders, as reported |
$ |
(149,140) |
$ |
(1,409) |
$ |
(59,406) |
$ |
(88,325) |
$ |
(1.11) |
|||||
|
June 30, 2015 | |||||||||||||||
|
Income |
Provision |
Noncont. |
Net Income |
EPS | |||||||||||
|
Income (loss) attributable to TETRA stockholders, excluding unusual charges and Maritech |
$ |
19,841 |
$ |
5,953 |
$ |
464 |
$ |
13,424 |
$ |
0.17 |
|||||
|
Severance expense |
(320) |
(96) |
(22) |
(202) |
0.00 |
||||||||||
|
Allowance for bad debt |
(1,100) |
(330) |
— |
(770) |
(0.01) |
||||||||||
|
Effect of deferred tax valuation allowance and other related tax adj. |
— |
(2,786) |
— |
2,786 |
0.03 |
||||||||||
|
Maritech profit (loss) |
(313) |
— |
— |
(313) |
0.00 |
||||||||||
|
Net Income (loss) attributable to TETRA stockholders, as reported |
$ |
18,108 |
$ |
2,741 |
$ |
442 |
$ |
14,925 |
$ |
0.19 |
|||||
|
Schedule F: Non-GAAP Reconciliation to GAAP Financials | |||||||||||||||||||||
|
Three Months Ended | |||||||||||||||||||||
|
June 30, 2016 | |||||||||||||||||||||
|
Income |
Impairments |
Adjusted |
Adjusted |
Depreciation |
Equity |
Adjusted | |||||||||||||||
|
(In Thousands) | |||||||||||||||||||||
|
Fluids Division |
$ |
454 |
$ |
501 |
$ |
955 |
$ |
2 |
$ |
7,326 |
$ |
— |
$ |
8,283 |
|||||||
|
Production Testing Division |
(4,328) |
131 |
(4,197) |
(143) |
4,176 |
— |
(164) |
||||||||||||||
|
Compression Division |
(4,040) |
984 |
(3,056) |
8,148 |
18,753 |
825 |
24,670 |
||||||||||||||
|
Offshore Services Segment |
37 |
56 |
93 |
— |
2,865 |
— |
2,958 |
||||||||||||||
|
Eliminations and other |
3 |
— |
3 |
— |
(3) |
— |
— |
||||||||||||||
|
Subtotal |
(7,874) |
1,672 |
(6,202) |
8,007 |
33,117 |
825 |
35,747 |
||||||||||||||
|
Corporate and other |
(16,179) |
1,870 |
(14,309) |
5,596 |
112 |
5,803 |
(2,798) |
||||||||||||||
|
TETRA excluding Maritech |
(24,053) |
3,542 |
(20,511) |
13,603 |
33,229 |
6,628 |
32,949 |
||||||||||||||
|
Maritech |
(3,401) |
— |
(3,401) |
10 |
309 |
— |
(3,082) |
||||||||||||||
|
Total TETRA |
$ |
(27,454) |
$ |
3,542 |
$ |
(23,912) |
$ |
13,613 |
$ |
33,538 |
$ |
6,628 |
$ |
29,867 |
|||||||
|
March 31, 2016 | |||||||||||||||||||||
|
Income |
Impairments |
Adjusted |
Adjusted |
Depreciation |
Equity |
Adjusted | |||||||||||||||
|
Fluids Division |
$ |
(358) |
$ |
114 |
$ |
(244) |
$ |
(26) |
$ |
7,396 |
$ |
— |
$ |
7,126 |
|||||||
|
Production Testing Division |
(19,374) |
17,073 |
(2,301) |
(189) |
4,592 |
— |
2,102 |
||||||||||||||
|
Compression Division |
(104,700) |
100,443 |
(4,257) |
8,802 |
18,464 |
636 |
23,645 |
||||||||||||||
|
Offshore Services Segment |
(7,708) |
— |
(7,708) |
— |
2,739 |
— |
(4,969) |
||||||||||||||
|
Eliminations and other |
4 |
— |
4 |
— |
(4) |
— |
— |
||||||||||||||
|
Subtotal |
(132,136) |
117,630 |
(14,506) |
8,587 |
33,187 |
636 |
27,904 |
||||||||||||||
|
Corporate and other |
(16,384) |
— |
(16,384) |
6,052 |
115 |
1,737 |
(8,480) |
||||||||||||||
|
TETRA excluding Maritech |
(148,520) |
117,630 |
(30,890) |
14,639 |
33,302 |
2,373 |
19,424 |
||||||||||||||
|
Maritech |
(620) |
— |
(620) |
— |
305 |
— |
(315) |
||||||||||||||
|
Total TETRA |
$ |
(149,140) |
$ |
117,630 |
$ |
(31,510) |
$ |
14,639 |
$ |
33,607 |
$ |
2,373 |
$ |
19,109 |
|||||||
|
June 30, 2015 | |||||||||||||||||||||
|
Income |
Impairments |
Adjusted |
Interest |
Depreciation |
Equity |
Adjusted | |||||||||||||||
|
Fluids Division |
$ |
32,583 |
$ |
171 |
$ |
32,754 |
$ |
(76) |
$ |
8,813 |
$ |
— |
$ |
41,491 |
|||||||
|
Production Testing Division |
(472) |
1,147 |
675 |
14 |
6,168 |
— |
6,857 |
||||||||||||||
|
Compression Division |
1,498 |
45 |
1,543 |
8,658 |
20,686 |
727 |
31,614 |
||||||||||||||
|
Offshore Services Segment |
2,095 |
32 |
2,127 |
— |
2,888 |
— |
5,015 |
||||||||||||||
|
Eliminations and other |
(12) |
— |
(12) |
— |
(3) |
— |
(15) |
||||||||||||||
|
Subtotal |
35,692 |
1,395 |
37,087 |
8,596 |
38,552 |
727 |
84,962 |
||||||||||||||
|
Corporate and other |
(17,271) |
25 |
(17,246) |
4,697 |
255 |
1,874 |
(10,420) |
||||||||||||||
|
TETRA excluding Maritech |
18,421 |
1,420 |
19,841 |
13,293 |
38,807 |
2,601 |
74,542 |
||||||||||||||
|
Maritech |
(313) |
— |
(313) |
26 |
260 |
— |
(27) |
||||||||||||||
|
Total TETRA |
$ |
18,108 |
$ |
1,420 |
$ |
19,528 |
$ |
13,319 |
$ |
39,067 |
$ |
2,601 |
$ |
74,515 |
|||||||
|
(1) |
Adjusted interest expense, net, for the three month period ended June 30, 2016, excludes $0.7 million of interest expense related to CCLP debt refinancing. |
|
Schedule G: Non-GAAP Reconciliation to Free Cash Flow | |||||||||||
|
Three Months Ended | |||||||||||
|
June 30, 2016 |
March 31, 2016 |
June 30, 2015 | |||||||||
|
(In Thousands) | |||||||||||
|
Consolidated |
|||||||||||
|
Net cash provided by operating activities |
$ |
8,336 |
$ |
25,261 |
$ |
54,347 |
|||||
|
ARO settlements |
64 |
3,379 |
3,845 |
||||||||
|
Capital expenditures, net of sales proceeds |
(4,732) |
(1,985) |
(23,188) |
||||||||
|
Consolidated adjusted free cash flow |
3,668 |
26,655 |
35,004 |
||||||||
|
CSI Compressco LP |
|||||||||||
|
Net cash provided by operating activities |
20,469 |
15,095 |
19,721 |
||||||||
|
Capital expenditures, net of sales proceeds |
(2,453) |
(1,353) |
(19,934) |
||||||||
|
CSI Compressco free cash flow |
18,016 |
13,742 |
(213) |
||||||||
|
TETRA Only |
|||||||||||
|
Cash from operating activities |
(12,133) |
10,166 |
34,626 |
||||||||
|
ARO settlements |
64 |
3,379 |
3,845 |
||||||||
|
Capital expenditures, net of sales proceeds |
(2,279) |
(632) |
(3,254) |
||||||||
|
Free cash flow before ARO settlements |
(14,348) |
12,913 |
35,217 |
||||||||
|
Distributions from CSI Compressco LP |
5,575 |
5,575 |
7,651 |
||||||||
|
Adjusted free cash flow |
(8,773) |
18,488 |
42,868 |
||||||||
|
Schedule H: Non-GAAP Reconciliation of TETRA Net Debt | |
|
The cash and debt positions of TETRA and CSI Compressco LP as of June 30, 2016, are shown below. TETRA and CSI Compressco LP's debt agreements are distinct and separate with no cross default provisions, no cross collateral provisions and no cross guarantees. Management believes that the most appropriate method to analyze the debt positions of each company is to view them separately, as noted below. | |
|
The following reconciliation of net debt is presented as a supplement to financial results prepared in accordance with GAAP. The Company defines net debt as the sum of long-term and short-term debt on its consolidated balance sheet, less cash, excluding restricted cash on the consolidated balance sheet and excluding the debt and cash of CSI Compressco LP. Management views TETRA net debt as a measure of TETRA's ability to reduce debt, add to cash balances, pay dividends, repurchase stock, and fund investing and financing activities. |
|
June 30, 2016 | |||||||
|
TETRA |
CCLP | ||||||
|
(In Millions) | |||||||
|
Non-restricted cash |
$ |
7.2 |
$ |
16.7 |
|||
|
Revolver debt outstanding |
101.6 |
231.2 |
|||||
|
Senior Notes outstanding |
117.4 |
338.0 |
|||||
|
Net debt |
$ |
211.8 |
$ |
552.5 |
|||
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SOURCE TETRA Technologies, Inc.
