HOUSTON, Feb. 20, 2018 /PRNewswire/ -- Flotek
Industries, Inc. ("Flotek" or the "Company") (NYSE: FTK) today
announced results for the three and twelve months ended
December 31, 2017.
Highlights
- GAAP earnings (loss) per share ("EPS") from continuing
operations of ($0.14) and
($0.23) for the three and twelve
months ended December 31, 2017,
respectively; compared to $0.07 and
$0.03 for the three and twelve months
ended December 31, 2016,
respectively.
- Adjusted EPS from continuing operations of $0.00 and ($0.07)
for the three and twelve months ended December 31, 2017, respectively; compared to
($0.07) and ($0.11) for the three and twelve months ended
December 31, 2016, respectively.
- Full year 2017 revenue increased 20.6% year-over-year to
$317.1 million. Fourth quarter 2017
revenue declined 8.7% sequentially to $72.5
million and increased 2.7% year-over-year.
- Cash SG&A of $14.5 million
(excluding stock compensation expense of $1.5 million) in the fourth quarter 2017, under
the low end of the Company's guidance of $15.0 million - $16.0
million, decreased 25% compared to fourth quarter 2016
levels, ahead of its 20% y/y reduction target.
- Net income (loss) from continuing operations of ($7.8) million for the fourth quarter 2017,
compared to ($3.4) million for the
third quarter 2017 and $3.9 million
in the fourth quarter 2016.
- Adjusted EBITDA, a non-GAAP measure, of $7.7 million for the fourth quarter 2017,
compared to $3.3 million in the third
quarter 2017 and $0.7 million in the
fourth quarter 2016.
- Fourth quarter 2017 free cash flow (operating cash flow less
capital expenditures) of $13.1
million, compared to $6.8
million in third quarter 2017 and ($0.5) million in fourth quarter 2016.
- Decreased net debt position by 46.4% year-over-year to
$23.4 million at year end 2017.
(Please refer to GAAP reconciliation tables in this
release)
John Chisholm, Flotek's Chairman,
President and Chief Executive Officer commented, "Last year was a
transformational year for Flotek, as we undertook several measures
to improve our market position and profitability. First, during
2017, our management team was transformed to reflect the future of
Flotek, and we are excited about the strength of our leadership
team as we enter 2018 as a re-defined organization. Second, in May,
we completed the Drilling Technologies and Production Technologies
segment divestitures which have improved our free cash flow
profile. Third, we paid down the balance of our term loan and
increased the availability of our revolver while extending its
maturity by two years. Our total debt at year end 2017 was
$28.0 million, down 42% from
$48.4 million at year end 2016.
Fourth, we initiated a thorough review of our SG&A with a
targeted run-rate reduction of 20% from 4Q16 levels. Our 4Q17 cash
SG&A achieved a 25% reduction. Through it all, we have remained
committed to our Research and Innovation, which continues to
introduce new products into the market specifically to meet the
requirements and needs of both E&P operators and service
companies who remain integral in the efficient distribution
channels into the industry.
"During the fourth quarter 2017, our Energy Chemistry
Technologies ("ECT") segment experienced a slower than anticipated
December month, largely due to weather events, budget exhaustion
and seasonal factors which we alluded to in our guidance last
quarter. Despite the industry related operational issues and
subsequently lower revenues, our recent focus on cost control led
to the highest quarterly segment profitability at the EBITDA and
operating income lines for the year. As an organization, we are
proud of the progress and execution we have made on this front,
which was laid out on our third quarter 2017 call, and which I
attribute to the quality and effort of our employees.
"Additionally, we have begun increasing our marketing efforts
through the release of a series of case studies. Most recently, we
released a study evaluating a sample of 426 Midland Basin wells
targeting the Wolfcamp B interval. Wells with our Complex
nano-Fluid® technology improved cumulative barrels of oil
equivalent (BOE) over the first 12 months of production by 22%
after normalizing for proppant amount and perforated length. We
will continue to provide insight into the success E&P operators
experience in utilizing Flotek's custom chemistry solutions going
forward. Our focus remains on improving reservoir performance and
recovery factors which makes a difference to our clients' economics
and provides consistent and reliable chemistry technology to
operators and service companies alike.
"Our Consumer and Industrial Chemistry Technologies ("CICT")
segment continued to perform well despite a volatile citrus market,
which remains impacted by lower crop yields due to disease and
hurricane activity. Fourth quarter revenues were in line with our
guidance and represent an 11.3% year-over-year improvement. During
the fourth quarter we completed the installation of a new vacuum
distillation unit in Winter Haven,
FL, and we continue to invest in improving our facilities
and market position in our CICT segment.
"As a result of reducing our debt, we have bolstered our
financial position. Our only debt today consists of our revolver
borrowings, which is primarily being used to fund working capital.
Our balance sheet gives us the flexibility to remain opportunistic
moving forward as we execute our plans to grow in the custom
chemistry marketplace, both in ECT and CICT. We will also continue
to evaluate further stock buybacks but believe our runway of growth
opportunities requires disciplined investment to preserve our
strong balance sheet and liquidity position.
"Looking ahead, I am very excited about our opportunities, our
employees are dedicated, and our focus remains on serving our
clients the best we can by offering new technology at competitive
prices. The measures we are undertaking to control our costs,
leverage our R&I capability for new product development and
align ourselves with our clients is designed to have a measurable,
positive impact to shareholder value in the long run."
Full Year 2017 Results
For the twelve months ended December 31,
2017, Flotek reported revenue of $317.1 million, an increase of $54.3 million, or 20.6%, compared to $262.8 million in 2016.
Flotek reported income (loss) from continuing operations for the
twelve months ended December 31, 2017
of ($13.1) million, a decrease of
$15.0 million compared to
$1.9 million in 2016. On a GAAP
basis, Flotek reported income (loss) per share (fully diluted) for
the twelve months ended December 31,
2017 of ($0.23) from
continuing operations compared to $0.03 for the twelve months ended December 31, 2016.
Excluding select items, comprised primarily of executive
retirement/severance expense and the impact of the U.S. Tax Cuts
& Jobs Act of 2017 to income tax expense totaling $9.2 million, net of tax, or $0.16 per share, adjusted EPS from continuing
operations was ($0.07) for the twelve
months ended December 31, 2017,
compared to ($0.11) for the twelve
months ended December 31, 2016. (See
our Reconciliation of Non-GAAP Items and Non-Cash Items Impacting
Earnings at the conclusion of this release.)
Earnings Before Interest, Taxes, Depreciation and Amortization
("EBITDA") for the twelve months ended December 31, 2017, was $10.1 million, compared to $15.6 million for the twelve months ended
December 31, 2016. Adjusted EBITDA,
which excludes select items comprised primarily of stock
compensation expense, gain on sale of assets and executive
retirement/severance expense, for the full year 2017 was
$23.5 million, compared to full year
2016 adjusted EBITDA of $14.9
million. Management believes that adjusted EBITDA provides
useful information to investors to better assess and understand
operating performance and cash flows. (See our Reconciliation of
Non-GAAP Items and Non-Cash Items Impacting Earnings at the
conclusion of this release.)
Fourth Quarter 2017 Results
For the three months ended December 31,
2017, Flotek reported revenue of $72.5 million, an increase of $1.9 million, or 2.7%, compared to $70.6 million in the same period of 2016. Revenue
decreased $6.9 million, or 8.7%,
compared to the third quarter of 2017.
Flotek reported income (loss) from continuing operations for the
three months ended December 31, 2017
of ($7.8) million, a decrease of
$11.7 million compared to
$3.9 million in the same period of
2016. Income (loss) from continuing operations decreased
$4.3 million compared to third
quarter 2017. On a GAAP basis, Flotek reported income (loss) per
share (fully diluted) from continuing operations for the three
months ended December 31, 2017 of
($0.14) compared to $0.07 for the three months ended December 31, 2016.
Excluding select items, comprised primarily of executive
retirement/severance expense and the impact of the U.S. Tax Cuts
& Jobs Act of 2017 to income tax expense totaling $8.0 million, net of tax, or $0.14 per share, adjusted EPS from continuing
operations was $0.00 for the three
months ended December 31, 2017,
compared to ($0.07) for the three
months ended December 31, 2016. (See
our Reconciliation of Non-GAAP Items and Non-Cash Items Impacting
Earnings at the conclusion of this release.)
EBITDA for the three months ended December 31, 2017, was $5.3 million, compared to $10.0 million for the three months ended
December 31, 2016. Adjusted EBITDA,
which excludes select items comprised primarily of stock
compensation expense, gain on sale of assets and executive
retirement/severance expense, was $7.7
million compared to fourth quarter 2016 adjusted EBITDA of
$0.7 million and third quarter 2017
adjusted EBITDA of $3.3 million.
Management believes that adjusted EBITDA provides useful
information to investors to better assess and understand operating
performance and cash flows. (See our Reconciliation of Non-GAAP
Items and Non-Cash Items Impacting Earnings at the conclusion of
this release.)
A summary income statement reflecting fourth quarter and full
year results can be found at the conclusion of this release, as
well as GAAP reconciliation tables.
Fourth Quarter 2017 – Segment Highlights
|
|
|
|
|
|
|
|
|
|
|
|
|
4Q
2017
|
3Q
2017
|
%
Change
|
4Q
2016
|
%
Change
|
Energy Chemistry
Technologies ("ECT")
|
Revenue
|
$55.3
million
|
$61.2
million
|
(9.6%)
|
$55.1
million
|
0.3%
|
Income From
Operations
|
$8.9
million
|
$6.9
million
|
29.5%
|
$7.2
million
|
23.2%
|
Adj.
EBITDA
|
$14.6
million
|
$11.7
million
|
24.1%
|
$12.6
million
|
15.5%
|
Adj. EBITDA
Margin
|
26.4%
|
19.2%
|
716
bps
|
22.9%
|
347
bps
|
Consumer and
Industrial Chemistry Technologies ("CICT")
|
Revenue
|
$17.2
million
|
$18.3
million
|
(5.9%)
|
$15.5
million
|
11.3%
|
Income From
Operations
|
$1.6
million
|
$1.0
million
|
58.3%
|
$1.2
million
|
34.9%
|
Adj.
EBITDA
|
$2.4
million
|
$1.9
million
|
30.8%
|
$1.8
million
|
33.4%
|
Adj. EBITDA
Margin
|
14.1%
|
10.2%
|
397
bps
|
11.8%
|
235
bps
|
|
* Percentages may
be different when calculated due to rounding.
|
** Segment adj.
EBITDA excludes stock based compensation, gain on sale of assets
and R&I allocations.
|
Energy Chemistry Technologies Highlights (ECT):
- Full year 2017 revenue increased 29.2% year-over-year to
$243.1 million.
- Fourth quarter revenue decreased 9.6% sequentially to
$55.3 million, and increased 0.3%
year-over-year.
- Fourth quarter adjusted EBITDA margins increased by 716 basis
points sequentially to 26.4% due to higher margin product sales,
continued execution on cost controls and reduced pressure from
hurricane related impacts.
- Fourth quarter adjusted EBITDA margins increased 347 basis
points year-over-year due to cost controls.
Consumer and Industrial Chemistry Technologies Highlights
(CICT):
- Full year CICT revenue decreased 0.8% year-over-year to
$74.0 million.
- Fourth quarter CICT revenue decreased 5.9% sequentially to
$17.2 million, and increased 11.3%
year-over-year.
- Fourth quarter CICT adjusted EBITDA margins increased by 397
basis points sequentially to 14.1% due to higher margin product
sales and reduced pressure on citrus price inflation following
Hurricane Irma in the third quarter. Fourth quarter adjusted EBITDA
margins increased 235 basis year-over-year due to higher margin
product sales.
Balance Sheet and Liquidity
Net Debt decreased 34.5% from $35.6
million to $23.4 million,
sequentially, and decreased 46.4% year-over-year from $43.6 million at year end 2016. Working capital
benefits were $9.5 million for the
fourth quarter 2017, primarily driven by reduction in Accounts
Receivable. Total liquidity at quarter end was $48.5 million. The balance on our credit facility
as of December 31, 2017 was
$28.0 million, compared to
$40.6 million at the end of the third
quarter and was $37.2 million as of
2/12/2018. We expect to fund working capital, as customary
with our inventory purchases, during the front half of
2018.
Other Financial Items
- During the fourth quarter 2017, we incurred $7.3 million of tax expenses as a result of
changes under the U.S. Tax Cuts & Jobs Act of 2017; as well as
$0.7 million (net of taxes) related
to executive retirement/severance expenses.
- Beginning with this release, cost of revenue shown on the
Income Statement is no longer inclusive of any portion of
depreciation & amortization, as was the case in prior period
financials. As a result, depreciation & amortization on the
Income Statement will now be consistent with the balances in the
Cash Flow Statement.
- Due to competitive reasons, in future periods we will no longer
disclose the detail of CnF® revenues and volumes which we have
provided in past releases. This will better align with the ECT
segment as a holistic custom chemistry solution provider to the oil
& gas industry.
- Finally, segment gross margins are no longer reported for
similar competitive reasons; however, we intend to continue to
report segment operating income and adjusted EBITDA.
Flotek Outlook
In commenting about Flotek's outlook, Mr. Chisholm added, "With
respect to our ECT segment, the oil and gas industry is shaping up
for a stable operating environment moving into 2018. To date,
operators appear to be acting with a degree of financial discipline
and a renewed focus on returns over growth. Disciplined spending
behavior, logistics challenges and weather delays in major basins
during the start of the year are likely to lead to a more flattish
environment in completions activity in 1Q18 sequentially, however
the quarter will be dependent upon how quickly activity can return
to pre-December levels. In our CICT segment, we expect revenues to
increase sequentially and be flat to up year-over-year. Our
SG&A reductions achieved through our cost cutting initiative
should largely remain as we progress through the year. We
anticipate capital spending to be in the $12
million to $16 million range
for 2018 and will continue to manage our investments with a focus
on our operating cash flows."
Conference Call Details
Flotek will host a conference call on Wednesday, February 21, at 9:30 AM CT (10:30 AM
ET) to discuss its operating results for the three and
twelve months ended December 31,
2017. To participate in the call, participants should dial
800-768-8804 approximately 5 minutes prior to the start of the
call. The call can also be accessed from Flotek's website at
www.flotekind.com.
About Flotek Industries, Inc.
Flotek develops and delivers prescriptive chemistry-based
technology, including specialty chemicals, to clients in the
energy, consumer industrials and food & beverage industries.
Flotek's inspired chemists draw from the power of bio-derived
solvents to deliver solutions that enhance energy production,
cleaning products, foods & beverages and fragrances. In the oil
and gas sector, Flotek serves major and independent energy
producers and oilfield service companies, both domestic and
international. Flotek Industries, Inc. is a publicly traded company
headquartered in Houston, Texas,
and its common shares are traded on the New York Stock Exchange
under the ticker symbol "FTK." For additional information, please
visit Flotek's web site at www.flotekind.com.
Forward-Looking Statements
Certain statements set forth in this Press Release constitute
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) regarding Flotek Industries, Inc.'s business,
financial condition, results of operations and prospects. Words
such as expects, anticipates, intends, plans, believes, seeks,
estimates and similar expressions or variations of such words are
intended to identify forward-looking statements, but are not the
exclusive means of identifying forward-looking statements in this
Press Release.
Although forward-looking statements in this Press Release
reflect the good faith judgment of management, such statements can
only be based on facts and factors currently known to management.
Consequently, forward-looking statements are inherently subject to
risks and uncertainties, and actual results and outcomes may differ
materially from the results and outcomes discussed in the
forward-looking statements. Factors that could cause or contribute
to such differences in results and outcomes include, but are not
limited to, demand for oil and natural gas drilling services in the
areas and markets in which the Company operates, competition,
obsolescence of products and services, the Company's ability to
obtain financing to support its operations, environmental and other
casualty risks, and the impact of government regulation.
Further information about the risks and uncertainties that may
impact the Company are set forth in the Company's most recent
filings on Form 10-K (including without limitation in the "Risk
Factors" Section), and in the Company's other SEC filings and
publicly available documents. Readers are urged not to place undue
reliance on these forward-looking statements, which speak only as
of the date of this Press Release. The Company undertakes no
obligation to revise or update any forward-looking statements in
order to reflect any event or circumstance that may arise after the
date of this Press Release.
Flotek Industries,
Inc.
|
Unaudited
Condensed Consolidated Balance Sheets
|
(in thousands,
except share data)
|
|
|
|
December 31,
2017
|
|
December 31,
2016
|
ASSETS
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
4,584
|
|
$
4,823
|
Accounts receivable,
net of allowance for doubtful accounts of $733 and $664 at
December 31, 2017 and December 31, 2016,
respectively
|
46,018
|
|
47,152
|
Inventories
|
75,759
|
|
58,283
|
Income taxes
receivable
|
2,826
|
|
12,752
|
Assets held for
sale
|
—
|
|
43,900
|
Other current
assets
|
9,264
|
|
21,708
|
Total current
assets
|
138,451
|
|
188,618
|
Property and
equipment, net
|
73,833
|
|
74,691
|
Goodwill
|
56,660
|
|
56,660
|
Deferred tax assets,
net
|
12,713
|
|
12,894
|
Other intangible
assets, net
|
48,231
|
|
50,352
|
TOTAL
ASSETS
|
$
329,888
|
|
$
383,215
|
LIABILITIES AND
EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
22,048
|
|
$
29,960
|
Accrued
liabilities
|
14,589
|
|
12,170
|
Interest
payable
|
43
|
|
24
|
Liabilities held for
sale
|
—
|
|
4,961
|
Current portion of
long-term debt
|
27,950
|
|
40,566
|
Total current
liabilities
|
64,630
|
|
87,681
|
Long-term debt, less
current portion
|
—
|
|
7,833
|
Total
liabilities
|
64,630
|
|
95,514
|
Commitments and
contingencies
|
|
|
|
Equity:
|
|
|
|
Cumulative
convertible preferred stock, $0.0001 par value, 100,000
shares authorized; no shares issued and outstanding
|
—
|
|
—
|
Common stock, $0.0001
par value, 80,000,000 shares authorized; 60,622,986 shares
issued and 56,755,293 shares outstanding at December 31, 2017;
59,684,669 shares issued and 56,972,580 shares outstanding at
December 31, 2016
|
6
|
|
6
|
Additional paid-in
capital
|
336,067
|
|
318,392
|
Accumulated other
comprehensive income (loss)
|
(884)
|
|
(956)
|
Retained earnings
(accumulated deficit)
|
(37,225)
|
|
(9,830)
|
Treasury stock, at
cost; 3,621,435 and 2,028,847 shares at December 31, 2017
and
|
|
|
|
December 31,
2016, respectively
|
(33,064)
|
|
(20,269)
|
Flotek Industries,
Inc. stockholders' equity
|
264,900
|
|
287,343
|
Noncontrolling
interests
|
358
|
|
358
|
Total
equity
|
265,258
|
|
287,701
|
TOTAL LIABILITIES
AND EQUITY
|
$
329,888
|
|
$
383,215
|
Flotek Industries,
Inc.
|
Unaudited
Condensed Consolidated Statements of Operations
|
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
12/31/2017
|
|
12/31/2016
|
|
12/31/2017
|
|
12/31/2016
|
|
(in thousands,
except per share data)
|
|
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
|
Revenue
|
$
72,509
|
|
$
70,604
|
|
$
317,098
|
|
$
262,832
|
|
|
|
|
|
|
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
Cost of revenue
(excluding depreciation and amortization)
|
47,739
|
|
47,249
|
|
215,129
|
|
170,254
|
Corporate general and
administrative
|
7,719
|
|
13,347
|
|
41,492
|
|
43,745
|
Segment selling and
administrative
|
8,264
|
|
9,526
|
|
37,236
|
|
36,405
|
Depreciation and
amortization
|
3,068
|
|
3,049
|
|
12,159
|
|
10,430
|
Research and
development
|
3,705
|
|
2,998
|
|
13,645
|
|
9,320
|
Loss (gain) on
disposal of long-lived assets
|
(109)
|
|
10
|
|
292
|
|
(18)
|
Total
expenses
|
70,386
|
|
76,179
|
|
319,953
|
|
270,136
|
Income (loss) from
operations
|
2,123
|
|
(5,575)
|
|
(2,855)
|
|
(7,304)
|
Other (expense)
income:
|
|
|
|
|
|
|
|
Interest
expense
|
(450)
|
|
(443)
|
|
(2,168)
|
|
(1,979)
|
Gain on legal
settlement
|
—
|
|
12,730
|
|
—
|
|
12,730
|
Other (expense)
income, net
|
148
|
|
(209)
|
|
812
|
|
(303)
|
Total other (expense)
income
|
(302)
|
|
12,078
|
|
(1,356)
|
|
10,448
|
(Loss) income
before income taxes
|
1,821
|
|
6,503
|
|
(4,211)
|
|
3,144
|
Income tax
expense
|
(9,588)
|
|
(2,586)
|
|
(8,842)
|
|
(1,237)
|
(Loss) income from
continuing operations
|
(7,767)
|
|
3,917
|
|
(13,053)
|
|
1,907
|
Loss from
discontinued operations, net of tax
|
(722)
|
|
(17,836)
|
|
(14,342)
|
|
(51,037)
|
Net
loss
|
$
(8,489)
|
|
$
(13,919)
|
|
$
(27,395)
|
|
$
(49,130)
|
|
|
|
|
|
|
|
|
Basic earnings
(loss) per common share:
|
|
|
|
|
|
|
|
Continuing
operations
|
$
(0.14)
|
|
$
0.07
|
|
$
(0.23)
|
|
$
0.03
|
Discontinued
operations, net of tax
|
(0.01)
|
|
(0.31)
|
|
(0.25)
|
|
(0.91)
|
Basic earnings (loss)
per common share
|
$
(0.15)
|
|
$
(0.24)
|
|
$
(0.48)
|
|
$
(0.88)
|
Diluted earnings
(loss) per common share:
|
|
|
|
|
|
|
|
Continuing
operations
|
$
(0.14)
|
|
$
0.07
|
|
$
(0.23)
|
|
$
0.03
|
Discontinued
operations, net of tax
|
(0.01)
|
|
(0.31)
|
|
(0.25)
|
|
(0.91)
|
Diluted earnings
(loss) per common share
|
$
(0.15)
|
|
$
(0.24)
|
|
$
(0.48)
|
|
$
(0.88)
|
Weighted average
common shares:
|
|
|
|
|
|
|
|
Weighted average
common shares used in computing basic earnings (loss) per common
share
|
57,196
|
|
57,768
|
|
57,580
|
|
56,087
|
Weighted average
common shares used in computing diluted earnings (loss) per common
share
|
57,196
|
|
58,138
|
|
57,580
|
|
56,350
|
Flotek Industries,
Inc.
|
Unaudited
Condensed Consolidated Statements of Cash Flows
|
(in
thousands)
|
|
Twelve Months
Ended
|
|
12/31/2017
|
|
12/31/2016
|
Cash flows from
operating activities:
|
|
|
|
Net loss
|
$
(27,395)
|
|
$
(49,130)
|
Loss from
discontinued operations, net of tax
|
(14,342)
|
|
(51,037)
|
(Loss) income from
continuing operations
|
(13,053)
|
|
1,907
|
Adjustments to
reconcile (loss) income from continuing operations to net cash
provided by operating activities:
|
|
|
|
Depreciation and
amortization
|
12,159
|
|
10,429
|
Amortization of
deferred financing costs
|
472
|
|
424
|
Provision for
doubtful accounts
|
124
|
|
558
|
Loss (gain) on sale
of assets
|
292
|
|
(18)
|
Stock compensation
expense
|
11,172
|
|
12,053
|
Deferred income tax
(benefit) provision
|
181
|
|
(19,681)
|
Reduction in tax
benefit related to share-based awards
|
1,989
|
|
2,510
|
Changes in current
assets and liabilities:
|
|
|
|
Accounts receivable,
net
|
1,445
|
|
(11,544)
|
Inventories
|
(17,291)
|
|
(6,528)
|
Income taxes
receivable
|
8,008
|
|
(8,189)
|
Other current
assets
|
12,153
|
|
(14,489)
|
Accounts
payable
|
(8,719)
|
|
12,653
|
Accrued
liabilities
|
8,180
|
|
23,946
|
Income taxes
payable
|
-
|
|
(1,890)
|
Interest
payable
|
19
|
|
(87)
|
Net cash provided by
operating activities
|
17,131
|
|
2,054
|
Cash flows from
investing activities:
|
|
|
|
Capital
expenditures
|
(8,960)
|
|
(13,960)
|
Proceeds from sales
of businesses
|
18,490
|
|
-
|
Proceeds from sale of
assets
|
689
|
|
115
|
Payments for
acquisition, net of cash acquired
|
-
|
|
(7,863)
|
Purchase of patents
and other intangible assets
|
(479)
|
|
(573)
|
Net cash provided by
(used in) investing activities
|
9,740
|
|
(22,281)
|
Cash flows from
financing activities:
|
|
|
|
Repayments of
indebtedness
|
(9,833)
|
|
(15,564)
|
Borrowings on
revolving credit facility
|
383,160
|
|
338,460
|
Repayments on
revolving credit facility
|
(393,776)
|
|
(325,043)
|
Debt issuance
costs
|
(579)
|
|
(1,199)
|
Reduction in tax
benefit related to share-based awards
|
-
|
|
(2,510)
|
Purchase of treasury
stock related to share-based awards
|
(1,729)
|
|
(2,350)
|
Proceeds from sale of
common stock
|
654
|
|
30,923
|
Repurchase of common
stock
|
(5,203)
|
|
-
|
Proceeds from
exercise of stock options
|
21
|
|
134
|
Net cash (used in)
provided by financing activities
|
(27,285)
|
|
22,851
|
Discontinued
operations:
|
|
|
|
Net cash (used in)
provided by operating activities
|
(684)
|
|
12
|
Net cash provided by
(used in) investing activities
|
708
|
|
(18)
|
Net cash flows
provided by (used in) discontinued operations
|
24
|
|
(6)
|
Effect of changes in
exchange rates on cash and cash equivalents
|
151
|
|
(3)
|
Net (decrease)
increase in cash and cash equivalents
|
(239)
|
|
2,615
|
Cash and cash
equivalents at the beginning of period
|
4,823
|
|
2,208
|
Cash and cash
equivalents at the end of period
|
$
4,584
|
|
$
4,823
|
Flotek Industries,
Inc.
|
Unaudited
Reconciliation of Non-GAAP Items and Non-Cash Items Impacting
Earnings
|
(in thousands,
except per share data)
|
|
GAAP Income (Loss)
from Continuing Operations and Reconciliation to Adjusted Net
Income (Loss) (Non-GAAP)
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
12/31/2017
|
|
12/31/2016
|
|
12/31/2017
|
|
12/31/2016
|
|
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
|
(Loss) Income from
Continuing Operations (GAAP)
|
$
(7,767)
|
|
$
3,917
|
|
$
(13,053)
|
|
$
1,907
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of 2017 Tax
Act to Income Tax Expense
|
7,308
|
|
-
|
|
7,308
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Select Items
Impacting Earnings, net of tax
|
657
|
|
(8,275)
|
|
1,851
|
|
(8,275)
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net
Income (Loss) (Non-GAAP)
|
|
$
198
|
|
$
(4,358)
|
|
$
(3,894)
|
|
$
(6,368)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Shares Outstanding (Fully Diluted)
|
57,196
|
|
58,138
|
|
57,580
|
|
56,350
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Earnings
(Loss) Per Share (Fully Diluted)
|
|
|
$
0.00
|
|
$
(0.07)
|
|
$
(0.07)
|
|
$
(0.11)
|
|
|
|
|
|
|
|
|
|
|
|
Select Items
Impacting Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive Retirement
and Severance Expense:
|
|
|
|
|
|
|
|
|
|
|
Stock Compensation
Expense
|
|
|
-
|
|
-
|
|
887
|
|
-
|
|
Cash
Payments
|
|
|
1,011
|
|
-
|
|
1,961
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on Legal
Settlement
|
|
|
-
|
|
(12,730)
|
|
-
|
|
(12,730)
|
|
|
|
|
|
|
|
|
|
|
|
Total Select
Items
|
|
|
$
1,011
|
|
$
(12,730)
|
|
$
2,848
|
|
$
(12,730)
|
|
|
|
|
|
|
|
|
|
|
|
|
Less income tax
effect at 35%
|
|
(354)
|
|
4,456
|
|
(997)
|
|
4,456
|
|
|
|
|
|
|
|
|
|
|
|
|
Select Items
Impacting Earnings, net of tax
|
|
|
$
657
|
|
$
(8,275)
|
|
$
1,851
|
|
$
(8,275)
|
|
* Management believes
that adjusted Net Income for the three and twelve months ended
December 31, 2017, and December 31, 2016, is useful to investors to
assess and understand operating performance, especially when
comparing those results with previous and subsequent periods.
Management views the expenses associated with executive retirement
to be outside of the Company's normal operating results. Management
analyzes operating results without the impact of the above items as
an indicator of performance, to identify underlying trends in the
business and cash flow from continuing operations, and to establish
operational goals.
|
Flotek Industries,
Inc.
|
Unaudited
Reconciliation of Non-GAAP Items and Non-Cash Items Impacting
Earnings
|
(in thousands,
except per share data)
|
|
GAAP Income (Loss)
from Continuing Operations and Reconciliation to Adjusted EBITDA
(Non-GAAP)
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
12/31/2017
|
|
12/31/2016
|
|
12/31/2017
|
|
12/31/2016
|
|
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
|
(Loss) Income from
Continuing Operations (GAAP)
|
$
(7,767)
|
|
$
3,917
|
|
$
(13,053)
|
|
$
1,907
|
|
|
|
|
|
|
|
|
|
|
|
Interest
Expense
|
|
450
|
|
443
|
|
2,168
|
|
1,979
|
|
|
|
|
|
|
|
|
|
|
|
Income Tax
Expense
|
|
9,588
|
|
2,586
|
|
8,842
|
|
1,237
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
Amortization
|
3,068
|
|
3,049
|
|
12,159
|
|
10,430
|
|
|
|
|
|
|
|
|
|
|
EBITDA
(Non-GAAP)
|
|
$
5,339
|
|
$
9,995
|
|
$
10,116
|
|
$
15,553
|
|
|
|
|
|
|
|
|
|
|
|
Stock Compensation
Expense
|
|
1,493
|
|
3,462
|
|
11,172
|
|
12,053
|
|
|
|
|
|
|
|
|
|
|
|
Loss / (Gain) on Sale
of Assets
|
|
(109)
|
|
10
|
|
292
|
|
(18)
|
|
|
|
|
|
|
|
|
|
|
|
Executive Retirement
and Severance Expense
|
|
1,011
|
|
-
|
|
1,961
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
(Gain) on Legal
Settlement
|
|
-
|
|
(12,730)
|
|
-
|
|
(12,730)
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(Non-GAAP)
|
|
$
7,734
|
|
$
737
|
|
$
23,541
|
|
$
14,858
|
|
|
|
|
|
|
|
|
|
|
* Management believes
that adjusted EBITDA for the three and twelve months ended December
31, 2017, and December 31, 2016, is useful to investors to assess
and understand operating performance, especially when comparing
those results with previous and subsequent periods. Management
views the expenses associated with executive retirement to be
outside of the Company's normal operating results. Management
analyzes operating results without the impact of the above items as
an indicator of performance, to identify underlying trends in the
business and cash flow from continuing operations, and to establish
operational goals.
|
Flotek Industries, Inc.
|
Unaudited
Reconciliation of Non-GAAP Items and Non-Cash Items Impacting
Earnings
|
(in thousands,
except per share data)
|
|
|
GAAP Segment Net
Income and Reconciliation to Segment Adjusted EBITDA
(Non-GAAP)
|
|
|
|
|
Energy Chemistry
Technologies
|
|
Consumer and
Industrial Technologies
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
12/31/2017
|
|
12/31/2016
|
|
12/31/2017
|
|
12/31/2016
|
|
12/31/2017
|
|
12/31/2016
|
|
12/31/2017
|
|
12/31/2016
|
|
|
(in thousands,
except per share data)
|
|
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Net Income
(GAAP)
|
|
$
8,896
|
|
$
7,220
|
|
$
33,611
|
|
$
29,014
|
|
$
1,559
|
|
$
1,156
|
|
$
7,465
|
|
$
9,664
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense
(a)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Tax Expense
(a)
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
Amortization
|
1,816
|
|
1,873
|
|
7,323
|
|
5,935
|
|
640
|
|
572
|
|
2,391
|
|
2,257
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment EBITDA
(Non-GAAP)
|
|
$
10,711
|
|
$
9,093
|
|
$
40,934
|
|
$
34,949
|
|
$
2,198
|
|
$
1,728
|
|
$
9,856
|
|
$
11,922
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Compensation
Expense
|
437
|
|
519
|
|
1,946
|
|
2,278
|
|
68
|
|
97
|
|
529
|
|
607
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
R&I
Allocation
|
|
3,535
|
|
2,997
|
|
13,130
|
|
9,319
|
|
169
|
|
0
|
|
515
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss / (Gain) on Sale
of Assets
|
|
(109)
|
|
10
|
|
298
|
|
(18)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Adjusted
EBITDA (Non-GAAP)
|
$
14,574
|
|
$
12,620
|
|
$
56,308
|
|
$
46,528
|
|
$
2,435
|
|
$
1,825
|
|
$
10,901
|
|
$
12,529
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Interest
Expense and Tax Expense are recorded at the Corporate level and not
allocated to segments.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Management believes
that adjusted EBITDA for the three and twelve months ended December
31, 2017, and December 31, 2016, is useful to investors to assess
and understand operating performance, especially when comparing
those results with previous and subsequent periods. Management
views the expenses associated with executive retirement to be
outside of the Company's normal operating results. Management
analyzes operating results without the impact of the above items as
an indicator of performance, to identify underlying trends in the
business and cash flow from continuing operations, and to establish
operational goals.
|
View original
content:http://www.prnewswire.com/news-releases/flotek-industries-inc-announces-fourth-quarter-2017-results-300601524.html
SOURCE Flotek Industries, Inc.