THE WOODLANDS, Texas, Aug. 7, 2020 /PRNewswire/ -- On August 4, 2020, TETRA Technologies, Inc. ("TETRA" or the "Company") (NYSE:TTI), after TETRA had released earnings but before the Company had filed its Form 10-Q for the three and six months ended June 30, 2020, one of TETRA's offshore completion fluids customers announced it had filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code (the "Customer Bankruptcy"). As a result of the Customer Bankruptcy, TETRA recorded bad debt expense of approximately $2.8 million in the three and six months ended June 30, 2020 to reflect TETRA's assessment of the collectability of the outstanding receivable from that customer. TETRA recorded this charge in the general and administrative expense line of the Consolidated Statements of Operations. Due to the timing of the Customer Bankruptcy announcement, our August 4th earnings release did not take into account this significant unusual bad debt expense. Please note such bad debt expense does not impact the Company's previously reported revenues, Adjusted EBITDA, Adjusted EBITDA margins, cash from operations or adjusted free cash flow.
The attached schedules have been updated from what was previously released to reflect this bad debt reserve.
This press release includes the following financial measures that are not presented in accordance with generally accepted accounting principles in the United States ("GAAP"): Adjusted earnings per share attributable to TETRA stockholders, Adjusted EBITDA, and Adjusted EBITDA Margin (Adjusted EBITDA as a percent of revenue) on consolidated and segment basis, Adjusted income (loss) before tax, TETRA-only adjusted free cash flow from continuing operations, and net debt. Please see Schedules E-K for reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures.
Investor Contact
For further information: Elijio Serrano, CFO, TETRA Technologies, Inc., The Woodlands, Texas, Phone: 281.367.1983, 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: Statement Regarding Use of Non-GAAP Financial Measures
Schedule F: Special Items
Schedule G: Non-GAAP Reconciliation to GAAP Financials
Schedule H: Non-GAAP Reconciliation of TETRA Net Debt
Schedule I: Non-GAAP Reconciliation to TETRA Only Adjusted Free Cash Flow
Schedule J: Non-GAAP Reconciliation to TETRA Only Adjusted Free Cash Flow From Continuing Operations
Schedule K: Non-GAAP Reconciliation to TETRA Adjusted EBITDA Margins and Adjusted Income (Loss) Before Tax Margins
Company Overview and Forward-Looking Statements
TETRA Technologies, Inc. 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, and compression services and equipment. TETRA owns an equity interest, including all of the general partner interest, in CSI Compressco LP (NASDAQ:CCLP), a master limited partnership.
Schedule A: Consolidated Income Statement (Unaudited)
Three Months Ended | Six Months Ended | ||||||||||||||||||
Jun 30, 2020 | Mar 31, 2020 | Jun 30, 2019 | Jun 30, 2020 | Jun 30, 2019 | |||||||||||||||
(In Thousands, Except per Share Amounts) | |||||||||||||||||||
Revenues | $ | 192,441 | $ | 222,942 | $ | 288,796 | $ | 415,383 | $ | 532,524 | |||||||||
Cost of sales, services, and rentals | 133,892 | 148,694 | 206,302 | 282,586 | 383,046 | ||||||||||||||
Depreciation, amortization, and accretion | 29,842 | 29,460 | 31,817 | 59,302 | 62,445 | ||||||||||||||
Impairments and other charges | 8,977 | 5,371 | 2,311 | 14,348 | 2,457 | ||||||||||||||
Insurance recoveries | (591) | — | — | (591) | — | ||||||||||||||
Total cost of revenues | 172,120 | 183,525 | 240,430 | 355,645 | 447,948 | ||||||||||||||
Gross profit | 20,321 | 39,417 | 48,366 | 59,738 | 84,576 | ||||||||||||||
General and administrative expense | 34,014 | 30,537 | 36,295 | 64,551 | 70,572 | ||||||||||||||
Interest expense, net | 17,586 | 17,856 | 18,529 | 35,442 | 36,908 | ||||||||||||||
Warrants fair value adjustment (income) expense | 11 | (338) | (1,520) | (327) | (1,113) | ||||||||||||||
CCLP Series A Preferred Units fair value adjustment (income) expense | — | — | 146 | — | 1,309 | ||||||||||||||
Other (income) expense, net | 3,839 | 439 | 627 | 4,278 | (324) | ||||||||||||||
Loss before taxes and discontinued operations | (35,129) | (9,077) | (5,711) | (44,206) | (22,776) | ||||||||||||||
Provision for income taxes | 2,001 | 1,154 | 2,490 | 3,155 | 4,099 | ||||||||||||||
Loss before discontinued operations | (37,130) | (10,231) | (8,201) | (47,361) | (26,875) | ||||||||||||||
Discontinued operations: | |||||||||||||||||||
Loss from discontinued operations, net of taxes | 163 | (145) | (345) | 18 | (771) | ||||||||||||||
Net loss | (36,967) | (10,376) | (8,546) | (47,343) | (27,646) | ||||||||||||||
Less: loss attributable to noncontrolling interest | 15,712 | 8,825 | 1,633 | 24,537 | 9,895 | ||||||||||||||
Net loss attributable to TETRA stockholders | $ | (21,255) | $ | (1,551) | $ | (6,913) | $ | (22,806) | $ | (17,751) | |||||||||
Basic per share information: | |||||||||||||||||||
Loss before discontinued operations attributable to TETRA stockholders | $ | (0.17) | $ | (0.01) | $ | (0.06) | $ | (0.18) | $ | (0.13) | |||||||||
Income (loss) from discontinued operations attributable to TETRA stockholders | $ | 0.00 | $ | 0.00 | $ | 0.00 | $ | 0.00 | $ | (0.01) | |||||||||
Net loss attributable to TETRA stockholders | $ | (0.17) | $ | (0.01) | $ | (0.06) | $ | (0.18) | $ | (0.14) | |||||||||
Weighted average shares outstanding | 125,886 | 125,587 | 125,612 | 125,736 | 125,646 | ||||||||||||||
Diluted per share information: | |||||||||||||||||||
Loss before discontinued operations attributable to TETRA stockholders | $ | (0.17) | $ | (0.01) | $ | (0.06) | $ | (0.18) | $ | (0.13) | |||||||||
Income (loss) from discontinued operations attributable to TETRA stockholders | $ | 0.00 | $ | 0.00 | $ | 0.00 | $ | 0.00 | $ | (0.01) | |||||||||
Net loss attributable to TETRA stockholders | $ | (0.17) | $ | (0.01) | $ | (0.06) | $ | (0.18) | $ | (0.14) | |||||||||
Weighted average shares outstanding | 125,886 | 125,587 | 125,612 | 125,736 | 125,646 | ||||||||||||||
Schedule B: Financial Results By Segment (Unaudited)
Three Months Ended | Six Months Ended | ||||||||||||||||||
Jun 30, 2020 | Mar 31, 2020 | Jun 30, 2019 | Jun 30, 2020 | Jun 30, 2019 | |||||||||||||||
(In Thousands) | |||||||||||||||||||
Revenues by segment: | |||||||||||||||||||
Completion Fluids & Products Division | $ | 71,346 | $ | 75,237 | $ | 79,767 | $ | 146,583 | $ | 141,348 | |||||||||
Water & Flowback Services Division | 24,723 | 57,467 | 73,124 | 82,190 | 151,802 | ||||||||||||||
Compression Division | 96,372 | 90,238 | 135,905 | 186,610 | 239,374 | ||||||||||||||
Eliminations and other | — | — | — | — | — | ||||||||||||||
Total revenues | $ | 192,441 | $ | 222,942 | $ | 288,796 | $ | 415,383 | $ | 532,524 | |||||||||
Gross profit (loss) by segment: | |||||||||||||||||||
Completion Fluids & Products Division | $ | 20,819 | $ | 25,964 | $ | 19,809 | $ | 46,783 | $ | 30,472 | |||||||||
Water & Flowback Services Division | (4,836) | 3,267 | 7,490 | (1,569) | 16,341 | ||||||||||||||
Compression Division | 4,511 | 10,380 | 21,235 | 14,890 | 38,094 | ||||||||||||||
Corporate overhead and eliminations | (173) | (194) | (168) | (366) | (331) | ||||||||||||||
Total gross profit | $ | 20,321 | $ | 39,417 | $ | 48,366 | $ | 59,738 | $ | 84,576 | |||||||||
Income (loss) before taxes by segment: | |||||||||||||||||||
Completion Fluids & Products Division | $ | 13,202 | $ | 19,396 | $ | 14,614 | $ | 32,598 | $ | 20,800 | |||||||||
Water & Flowback Services Division | (8,418) | (2,244) | 2,460 | (10,662) | 4,691 | ||||||||||||||
Compression Division | (23,006) | (12,790) | (3,483) | (35,796) | (11,284) | ||||||||||||||
Corporate overhead and eliminations | (16,907) | (13,439) | (19,302) | (30,346) | (36,983) | ||||||||||||||
Total income (loss) before taxes | $ | (35,129) | $ | (9,077) | $ | (5,711) | $ | (44,206) | $ | (22,776) | |||||||||
Please note that the above results by Segment include special charges and expenses. Please see Schedule F for details of those special charges and expenses. |
(1) Excludes discontinued operations |
Schedule C: Consolidated Balance Sheet (June 30, 2020 Unaudited)
June 30, 2020 | December 31, 2019 | ||||||
(In Thousands) | |||||||
Balance Sheet: | |||||||
Cash (excluding restricted cash) | $ | 56,722 | $ | 17,704 | |||
Accounts receivable, net | 114,306 | 175,918 | |||||
Inventories | 115,506 | 136,510 | |||||
Other current assets | 22,453 | 21,222 | |||||
PP&E, net | 713,584 | 758,637 | |||||
Operating lease right-of-use assets | 75,524 | 68,131 | |||||
Other assets | 90,499 | 93,800 | |||||
Total assets | $ | 1,188,594 | $ | 1,271,922 | |||
Liabilities of discontinued operations | $ | 1,873 | $ | 2,098 | |||
Other current liabilities | 145,454 | 186,625 | |||||
Long-term debt (1) | 843,292 | 842,871 | |||||
Long-term portion of asset retirement obligations | 12,862 | 12,762 | |||||
Warrants liability | 123 | 449 | |||||
Operating lease liabilities | 60,693 | 53,919 | |||||
Other long-term liabilities | 11,611 | 10,372 | |||||
Equity | 112,686 | 162,826 | |||||
Total liabilities and equity | $ | 1,188,594 | $ | 1,271,922 | |||
(1) Please see Schedule D for the individual debt obligations of TETRA and CSI Compressco LP. |
Schedule D: Long-Term Debt (Unaudited)
TETRA Technologies Inc. and its subsidiaries, other than CSI Compressco LP and its subsidiaries, are obligated under an asset-based bank credit agreement and a term credit agreement, neither of which are obligations of CSI Compressco LP and its subsidiaries. CSI Compressco LP and its subsidiaries are obligated under a separate asset-based bank credit agreement and two series of senior notes, neither of which are obligations of TETRA and its other subsidiaries. Amounts presented exclude deferred financing costs.
June 30, 2020 | December 31, 2019 | June 30, 2019 | |||||||||
(In Thousands) | |||||||||||
TETRA | |||||||||||
Asset-Based Credit Agreement | $ | — | $ | 1,000 | $ | 20,000 | |||||
Term Credit Agreement | 220,500 | 220,500 | 220,500 | ||||||||
TETRA total debt | 220,500 | 221,500 | 240,500 | ||||||||
Less current portion | — | — | — | ||||||||
TETRA total long-term debt | $ | 220,500 | $ | 221,500 | $ | 240,500 | |||||
CSI Compressco LP | |||||||||||
CCLP Credit Agreement | 1,477 | 3,500 | — | ||||||||
7.25% Senior Notes | 80,722 | 295,930 | 295,930 | ||||||||
7.50% Senior Notes | 400,000 | 350,000 | 350,000 | ||||||||
Second Lien Notes | 155,529 | — | — | ||||||||
Total debt | 637,728 | 649,430 | 645,930 | ||||||||
Less current portion | — | — | — | ||||||||
CCLP total long-term debt | $ | 637,728 | $ | 649,430 | $ | 645,930 | |||||
Consolidated total long-term debt | $ | 858,228 | $ | 870,930 | $ | 886,430 | |||||
Schedule E: Statement Regarding Use of Non-GAAP Financial Measures
In addition to financial results determined in accordance with GAAP, this press release may include the following non-GAAP financial measures for the Company: net debt; adjusted consolidated and segment income (loss) before taxes and special charges; adjusted diluted earnings (loss) per share before discontinued operations; consolidated and segment adjusted EBITDA; net income (loss) before taxes, Adjusted income (loss) before tax, Adjusted income (loss) before tax as a % of revenue, TETRA only adjusted free cash flow and TETRA only free cash flow from continuing operations; and segment adjusted EBITDA as a percent of revenue ("Adjusted EBITDA margin"). 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 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 the Segment's) 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 before discontinued operations is defined as the Company's diluted earnings (loss) per share excluding certain special or other charges (or credits). 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 before discontinued operations (and Adjusted EBITDA before discontinued operations as a percent of revenue) is defined as earnings before interest, taxes, depreciation, amortization, impairments and certain non-cash charges and non-recurring adjustments. Adjusted EBITDA before discontinued operations (and Adjusted EBITDA margin) 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.
Adjusted income before tax is defined as earnings (loss) before interest, taxes, impairments and certain non-cash charges and non-recurring adjustments. Adjusted income before tax (and Adjusted income before tax as a percent of revenue or Adjusted income before tax margin which is Adjusted income before tax divided by revenue) is used by management as a supplemental financial measure to assess the financial performance of the Company's normalized profitability while excluding any unusual, non-recurring items and tax benefits or detriment.
TETRA only adjusted free cash flow is a non-GAAP measure that the Company defines as cash from TETRA's operations, less capital expenditures net of sales proceeds and cost of equipment sold and including cash distributions to TETRA from CSI Compressco LP. TETRA only adjusted free cash flow from continuing operations is defined as TETRA only adjusted free cash flow less discontinued operations EBITDA and discontinued operations capital expenditures. 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.
TETRA only adjusted free cash flow and TETRA only adjusted free cash flow from continuing operations do not necessarily imply residual cash flow available for discretionary expenditures, as they exclude cash requirements for debt service or other non-discretionary expenditures that are not deducted.
TETRA net debt is defined as the sum of the carrying value 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 F: Special Items (Unaudited)
Three Months Ended | |||||||||||||||
June 30, 2020 | |||||||||||||||
Income (loss) | Provision | Non-cont. | Net Income | Diluted EPS | |||||||||||
(In Thousands, Except per Share Amounts) | |||||||||||||||
Income (loss) attributable to TETRA stockholders, excluding special items and discontinued operations | $ | (14,258) | $ | 2,001 | $ | (5,171) | $ | (11,088) | $ | (0.09) | |||||
Stock Warrant fair value adjustment | (11) | — | — | (11) | 0.00 | ||||||||||
Transaction and other expenses | (895) | — | (475) | (420) | 0.00 | ||||||||||
Impairments and other charges | (8,922) | — | (5,977) | (2,945) | (0.02) | ||||||||||
Restructuring charges | (486) | — | (179) | (307) | 0.00 | ||||||||||
Debt Refinancing | (4,754) | — | (3,184) | (1,570) | (0.01) | ||||||||||
Severance | (3,003) | — | (726) | (2,277) | (0.02) | ||||||||||
Bad Debt | (2,800) | — | — | — | (2,800) | (0.02) | |||||||||
Net income (loss) before discontinued operations | (35,129) | 2,001 | (15,712) | (21,418) | (0.17) | ||||||||||
Loss from discontinued operations | 163 | 0.00 | |||||||||||||
Net Income (loss) attributable to TETRA stockholders, as reported | $ | (21,255) | $ | (0.17) | |||||||||||
Three Months Ended | |||||||||||||||
March 31, 2020 | |||||||||||||||
Income (loss) | Provision | Non-cont. | Net Income | Diluted EPS | |||||||||||
(In Thousands, Except per Share Amounts) | |||||||||||||||
Income (loss) attributable to TETRA stockholders, excluding special items and discontinued operations | $ | (976) | $ | 1,154 | $ | (4,892) | $ | 2,762 | $ | 0.02 | |||||
Stock Warrant fair value adjustment | 338 | — | — | 338 | 0.00 | ||||||||||
Transaction and other expenses | (457) | — | (216) | (241) | 0.00 | ||||||||||
Impairments and other charges | (5,371) | — | (3,538) | (1,833) | (0.01) | ||||||||||
Restructuring charges | (259) | — | — | (259) | 0.00 | ||||||||||
Severance | (1,334) | — | (179) | (1,155) | (0.01) | ||||||||||
Bad debt | (1,018) | — | — | (1,018) | (0.01) | ||||||||||
Net income (loss) before discontinued operations | (9,077) | 1,154 | (8,825) | (1,406) | (0.01) | ||||||||||
Loss from discontinued operations | (145) | 0.00 | |||||||||||||
Net Income (loss) attributable to TETRA stockholders, as reported | $ | (1,551) | $ | (0.01) | |||||||||||
Three Months Ended | |||||||||||||||
June 30, 2019 | |||||||||||||||
Income (loss) | Provision | Non-cont. | Net Income | Diluted EPS | |||||||||||
(In Thousands, Except per Share Amounts) | |||||||||||||||
Income (loss) attributable to TETRA stockholders, excluding unusual charges | $ | (2,545) | $ | (530) | $ | (11) | $ | (2,004) | $ | (0.02) | |||||
Stock warrant fair value adjustment | 1,520 | 319 | — | 1,201 | 0.01 | ||||||||||
Convertible Series A preferred fair value adjustments | (146) | (35) | (74) | (37) | 0.00 | ||||||||||
5% Cash Redemption on CCLP Series A Preferred | (546) | (115) | (278) | (153) | 0.00 | ||||||||||
Earnout Adjustment | 400 | 84 | — | 316 | 0.00 | ||||||||||
Lee Plant Facility Expenses | 289 | 61 | — | 228 | 0.00 | ||||||||||
CEO Retirement | (1,843) | (387) | — | (1,456) | (0.01) | ||||||||||
Transaction Expense | (376) | (79) | (168) | (129) | 0.00 | ||||||||||
Inventory Adjustment | (153) | (32) | (68) | (53) | 0.00 | ||||||||||
Impairments and other charges | (2,311) | (485) | (1,034) | (792) | (0.01) | ||||||||||
Effect of deferred tax valuation allowance and other related tax adjustments | — | 3,689 | — | (3,689) | (0.03) | ||||||||||
Net income (loss) before discontinued operations | (5,711) | 2,490 | (1,633) | (6,568) | (0.06) | ||||||||||
Loss from discontinued operations | (345) | 0.00 | |||||||||||||
Net Income (loss) attributable to TETRA stockholders, as reported | $ (6,913) | $ | (0.06) | ||||||||||||
Schedule G: Non-GAAP Reconciliation to GAAP Financials (Unaudited)*
Three Months Ended | |||||||||||||||||||||||||||
June 30, 2020 | |||||||||||||||||||||||||||
Net | Tax | Income | Impairments | Adjusted | Interest | Adjusted | Equity | Adjusted | |||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||||||
Completion Fluids & Products Division | $ | 13,202 | $ | 3,310 | $ | 16,512 | $ | (143) | $ | 1,934 | $ | — | $ | 18,303 | |||||||||||||
Water & Flowback Services Division | (8,418) | 1,203 | (7,215) | (2) | 7,617 | — | 400 | ||||||||||||||||||||
Compression Division | (23,006) | 15,736 | (7,270) | 12,982 | 20,116 | 488 | 26,316 | ||||||||||||||||||||
Eliminations and other | 2 | — | 2 | — | — | — | 2 | ||||||||||||||||||||
Subtotal | (18,220) | 20,249 | 2,029 | 12,837 | 29,667 | 488 | 45,021 | ||||||||||||||||||||
Corporate and other | (16,909) | 621 | (16,288) | 4,749 | 175 | 1,602 | (9,762) | ||||||||||||||||||||
TETRA excluding Discontinued Operations | $ | (37,130) | $ | 2,001 | $ | (35,129) | $ | 20,870 | $ | (14,259) | $ | 17,586 | $ | 29,842 | $ | 2,090 | $ | 35,259 | |||||||||
March 31, 2020 | |||||||||||||||||||||||||||
Net | Tax | Income | Impairments | Adjusted | Adjusted | Adjusted | Equity | Adjusted | |||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||||||
Completion Fluids & Products Division | $ | 19,396 | $ | 450 | $ | 19,846 | $ | (154) | $ | 1,934 | $ | — | $ | 21,626 | |||||||||||||
Water & Flowback Services Division | (2,244) | 1,607 | (637) | (9) | 7,425 | — | 6,779 | ||||||||||||||||||||
Compression Division | (12,790) | 5,971 | (6,819) | 12,564 | 19,908 | 324 | 25,977 | ||||||||||||||||||||
Eliminations and other | 5 | — | 5 | — | (4) | — | 1 | ||||||||||||||||||||
Subtotal | 4,367 | 8,028 | 12,395 | 12,401 | 29,263 | 324 | 54,383 | ||||||||||||||||||||
Corporate and other | (13,444) | 73 | (13,371) | 5,455 | 197 | 1,145 | (6,574) | ||||||||||||||||||||
TETRA excluding Discontinued Operations | $ | (10,231) | $ | 1,154 | $ | (9,077) | $ | 8,101 | $ | (976) | $ | 17,856 | $ | 29,460 | $ | 1,469 | $ | 47,809 | |||||||||
Three Months Ended | |||||||||||||||||||||||||||
June 30, 2019 | |||||||||||||||||||||||||||
Net | Tax | Income | Impairments | Adjusted | Interest | Adjusted | Equity | Adjusted | |||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||||||
Completion Fluids & Products Division | $ | 14,614 | $ | (289) | $ | 14,325 | $ | (157) | $ | 3,723 | $ | — | $ | 17,891 | |||||||||||||
Water & Flowback Services Division | 2,460 | (400) | 2,060 | (8) | 8,871 | — | 10,923 | ||||||||||||||||||||
Compression Division | (3,483) | 3,607 | 124 | 12,998 | 19,054 | 590 | 32,766 | ||||||||||||||||||||
Eliminations and other | 1 | — | 1 | — | (3) | — | (2) | ||||||||||||||||||||
Subtotal | 13,592 | 2,918 | 16,510 | 12,833 | 31,645 | 590 | 61,578 | ||||||||||||||||||||
Corporate and other | (19,303) | 268 | (19,035) | 5,696 | 172 | 1,673 | (11,494) | ||||||||||||||||||||
TETRA excluding Discontinued Operations | $ | (8,201) | $ | 2,490 | $ | (5,711) | $ | 3,186 | $ | (2,525) | $ | 18,529 | $ | 31,817 | $ | 2,263 | $ | 50,084 | |||||||||
* Excludes the impact from discontinued operations. |
Schedule H: Non-GAAP Reconciliation of TETRA Net Debt (Unaudited)
The cash and debt positions of TETRA and CSI Compressco LP as of June 30, 2020, are shown below. TETRA and CSI Compressco LP's debt agreements are distinct and separate with no cross-default provisions. 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. Amounts presented are net of deferred financing costs.
June 30, 2020 | |||||||||||
TETRA | CCLP | Consolidated | |||||||||
(In Millions) | |||||||||||
Non-restricted cash | $ | 50.0 | $ | 6.8 | $ | 56.7 | |||||
Carrying value of long-term debt: | |||||||||||
Asset-Based Credit Agreement | — | 0.7 | 0.7 | ||||||||
Term Credit Agreement | 205.7 | — | 205.7 | ||||||||
Senior Notes outstanding | — | 636.8 | 636.8 | ||||||||
Net debt | $ | 155.7 | $ | 630.7 | $ | 786.5 | |||||
Schedule I: Non-GAAP Reconciliation to TETRA Only Adjusted Free Cash Flow (Unaudited)
Three Months Ended | Six Months Ended | ||||||||||||||||||
Jun 30, 2020 | Mar 31, 2020 | Jun 30, 2019 | Jun 30, 2020 | Jun 30, 2019 | |||||||||||||||
(In Thousands) | |||||||||||||||||||
Consolidated | |||||||||||||||||||
Net cash provided (used) by operating activities | $ | 38,211 | $ | 22,176 | $ | 30,965 | $ | 60,387 | $ | 38,377 | |||||||||
Capital expenditures, net of sales proceeds | (3,332) | (10,965) | (27,345) | (14,297) | (59,390) | ||||||||||||||
Consolidated adjusted free cash flow | $ | 34,879 | $ | 11,211 | $ | 3,620 | 46,090 | (21,013) | |||||||||||
CSI Compressco LP | |||||||||||||||||||
Net cash provided (used) by operating activities | $ | 4,823 | $ | 13,357 | $ | 8,710 | 18,180 | 40,342 | |||||||||||
Capital expenditures, net of sales proceeds | (1,125) | (6,483) | (16,434) | (7,608) | (39,586) | ||||||||||||||
CSI Compressco free cash flow | $ | 3,698 | $ | 6,874 | $ | (7,724) | 10,572 | 756 | |||||||||||
TETRA Only | |||||||||||||||||||
Cash from operating activities | $ | 33,388 | $ | 8,819 | $ | 22,255 | 42,207 | (1,965) | |||||||||||
Investment in CCLP Compressors | — | — | (8,740) | — | (11,142) | ||||||||||||||
Capital expenditures, net of sales proceeds | (2,207) | (4,482) | (10,911) | (6,689) | (19,804) | ||||||||||||||
Free cash flow | 31,181 | 4,337 | 2,604 | 35,518 | (32,911) | ||||||||||||||
Distributions from CSI Compressco LP | 169 | 169 | 168 | 338 | 337 | ||||||||||||||
TETRA Only Adjusted Free Cash Flow | $ | 31,350 | $ | 4,506 | $ | 2,772 | 35,856 | (32,574) | |||||||||||
Schedule J: Non-GAAP Reconciliation to TETRA Only Adjusted Free Cash Flow From Continuing Operations (unaudited)
Three Months Ended | Six Months Ended | ||||||||||||||||||
Jun 30, 2020 | Mar 31, 2020 | Jun 30, 2019 | Jun 30, 2020 | Jun 30, 2019 | |||||||||||||||
(In Thousands) | |||||||||||||||||||
TETRA Only | |||||||||||||||||||
Cash from operating activities | $ | 33,388 | $ | 8,819 | $ | 22,255 | $ | 42,207 | $ | (1,965) | |||||||||
Less: Discontinued operations operating activities (adjusted EBITDA) | 163 | (145) | (345) | 18 | (771) | ||||||||||||||
Cash from continued operating activities | 33,225 | 8,964 | 22,600 | 42,189 | (1,194) | ||||||||||||||
Less: Continuing operations capital expenditures | (2,207) | (4,482) | (10,911) | (6,689) | (19,804) | ||||||||||||||
Less: Investment in CCLP Compressors | — | — | (8,740) | — | (11,142) | ||||||||||||||
Distributions from CSI Compressco LP | 169 | 169 | 168 | 338 | 337 | ||||||||||||||
TETRA Only Adjusted Free Cash Flow From Continuing Operations | $ | 31,187 | $ | 4,651 | $ | 3,117 | $ | 35,838 | $ | (31,803) | |||||||||
Schedule K: Non-GAAP Reconciliation to TETRA Adjusted EBITDA Margins and Adjusted Income (Loss) before tax margins (Unaudited)
Three Months Ended | |||||||||||
Jun 30, 2020 | Mar 31, 2020 | Jun 30, 2019 | |||||||||
(In Thousands) | |||||||||||
Consolidated | |||||||||||
Revenue | $ | 192,441 | $ | 222,942 | $ | 288,796 | |||||
Income (loss) before tax | (35,129) | (9,077) | (5,711) | ||||||||
Adjusted income (loss) before tax (Schedule G) | (14,259) | (976) | (2,525) | ||||||||
Adjusted EBITDA (Schedule G) | 35,259 | 47,809 | 50,084 | ||||||||
Income (Loss) Before Tax Margin | (18.3) | % | (4.1) | % | (2.0) | % | |||||
Adjusted Income (Loss) Before Tax Margin | (7.4) | % | (0.4) | % | (0.9) | % | |||||
Adjusted EBITDA Margin | 18.3 | % | 21.4 | % | 17.3 | % | |||||
Completion Fluids & Products | |||||||||||
Revenue | $ | 71,346 | $ | 75,237 | $ | 79,767 | |||||
Income (loss) before tax | 13,202 | 19,396 | 14,614 | ||||||||
Adjusted income (loss) before tax (Schedule G) | 16,512 | 19,846 | 14,325 | ||||||||
Adjusted EBITDA (Schedule G) | 18,303 | 21,626 | 17,891 | ||||||||
Income (Loss) Before Tax Margin | 18.5 | % | 25.8 | % | 18.3 | % | |||||
Adjusted Income (Loss) Before Tax Margin | 23.1 | % | 26.4 | % | 18.0 | % | |||||
Adjusted EBITDA Margin | 25.7 | % | 28.7 | % | 22.4 | % | |||||
Water & Flowback Services | |||||||||||
Revenue | $ | 24,723 | $ | 57,467 | $ | 73,124 | |||||
Income (loss) before tax | (8,418) | (2,244) | 2,460 | ||||||||
Adjusted income (loss) before tax (Schedule G) | (7,215) | (637) | 2,060 | ||||||||
Adjusted EBITDA (Schedule G) | 400 | 6,779 | 10,923 | ||||||||
Income (Loss) Before Tax Margin | (34.0) | % | (3.9) | % | 3.4 | % | |||||
Adjusted Income (Loss) Before Tax Margin | (29.2) | % | (1.1) | % | 2.8 | % | |||||
Adjusted EBITDA Margin | 1.6 | % | 11.8 | % | 14.9 | % | |||||
Compression | |||||||||||
Revenue | $ | 96,372 | $ | 90,238 | $ | 135,905 | |||||
Income (loss) before tax | (23,006) | (12,790) | (3,483) | ||||||||
Adjusted income (loss) before tax (Schedule G) | (7,270) | (6,819) | 124 | ||||||||
Adjusted EBITDA (Schedule G) | 26,316 | 25,977 | 32,766 | ||||||||
Income (Loss) Before Tax Margin | (23.9) | % | (14.2) | % | (2.6) | % | |||||
Adjusted Income (Loss) Before Tax Margin | (7.5) | % | (7.6) | % | 0.1 | % | |||||
Adjusted EBITDA Margin | 27.3 | % | 28.8 | % | 24.1 | % | |||||
SOURCE TETRA Technologies, Inc.
