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
June 30,
|
|
Six Months
Ended
June 30,
|
|
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
June 30,
|
|
Six Months
Ended
June 30,
|
|
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
(Loss) Before
Tax
|
Provision
(Benefit) for
Tax
|
Noncont.
Interest
|
Net Income
Attributable to
TETRA
Stockholders
|
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
(Loss) Before
Tax
|
Provision
(Benefit)
for Tax
|
Noncont.
Interest
|
Net Income
Attributable to
TETRA
Stockholders
|
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
(Loss) Before
Tax
|
Provision
(Benefit) for
Tax
|
Noncont.
Interest
|
Net Income
Attributable to
TETRA
Stockholders
|
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
(Loss)
Before Tax,
as Reported
|
Impairments
& Special
Charges
|
Adjusted
Income
(Loss)
Before Tax
|
Adjusted
Interest
Expense,
Net(1)
|
Depreciation
&
Amortization
|
Equity
Comp.
Expense
|
Adjusted
EBITDA
|
|
(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
(Loss)
Before Tax,
as Reported
|
Impairments
& Special
Charges
|
Adjusted
Income
(Loss)
Before Tax
|
Adjusted
Interest
Expense,
Net(1)
|
Depreciation
&
Amortization
|
Equity
Comp.
Expense
|
Adjusted
EBITDA
|
|
|
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
(Loss)
Before Tax,
as Reported
|
Impairments
& Special
Charges
|
Adjusted
Income
(Loss)
Before Tax
|
Interest
Expense,
Net
|
Depreciation
&
Amortization
|
Equity
Comp.
Expense
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
|
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.