THE WOODLANDS, Texas,
Feb. 27, 2020 /PRNewswire/
-- TETRA Technologies, Inc. ("TETRA" or the "Company")
(NYSE:TTI) today announced consolidated net loss before
discontinued operations of $114
million in the fourth quarter 2019, compared to a loss of
$9 million in the third quarter of
2019 and income of $3 million in the
fourth quarter of 2018. Net loss per share before
discontinued operations attributable to TETRA shareholders during
the fourth quarter was $0.91,
compared to a loss of $0.06 in the
third quarter of 2019 and income of $0.04 in the fourth quarter of 2018.
TETRA's adjusted per share earnings before discontinued
operations and excluding special items(1), was
$0.03 in the fourth quarter, compared
to a loss of $0.02 in the third
quarter 2019 and a loss of $0.01 in
the fourth quarter of 2018.
Fourth quarter 2019 revenue was $259
million, an increase of 5% over the third quarter of 2019
but a decrease of 8% compared to the fourth quarter of 2018.
Total year 2019 revenue was $1.038
billion, an increase of 4% over 2018.
Adjusted EBITDA(1) on a consolidated basis was
$55 million in the fourth quarter, up
18% from $46 million in the third
quarter reflecting the benefit of a TETRA CS Neptune® completion
fluids ("CS Neptune") project and overall strong completion fluids
sales in international markets, partially offset by weaker U.S.
land Water & Flowback Services activity. Profit (loss)
before tax margin for the fourth quarter was negative 43.9%
compared to a negative 3.0% for the third quarter. Fourth
quarter results were impacted by $117
million non-cash expense for fixed assets, intangibles and
goodwill impairments. Adjusted EBITDA on a consolidated basis
as a percentage of revenue ("Adjusted EBITDA margin")(1)
improved to 21.0%, up from 18.8% in the third quarter of
2019.
Brady M. Murphy, TETRA's Chief
Executive Officer, stated, "We ended the year in a very challenging
energy services market with our best quarterly financial
performance in over four years as reflected in Adjusted EBITDA,
driven by the CS Neptune project in the Gulf of Mexico, continued strong international
offshore completion fluid activity and near record Adjusted EBITDA
from our Compression segment. While North America land
drilling and completion activity saw a sharp decline in the fourth
quarter of 2019 as evidenced by the rig count declining
approximately 25% from year-end 2018, our vertically integrated
business model in Completion Fluids & Products and in
Compression plus our diverse business portfolio including offshore
and international markets, helped us navigate this difficult
environment. Our strategy to differentiate in areas where we
compete is evident in our fourth quarter results and, coupled with
continued capital discipline, has allowed us to achieve this strong
performance.
"Our fourth quarter results reflect great progress on our key
objectives, which we have highlighted during our previous
calls. Our technology leadership in high-end completion
fluids combined with our long-term key supply agreements helped us
deliver one of the strongest quarters for our Completion Fluids
& Products business based on our key financial measures.
We continue to grow our international offshore business with the
award of three major non-CS Neptune completion fluids projects in
Asia-Pacific, West Africa and Brazil that are scheduled for completion in
2020. We are currently in various stages of testing and
qualification of CS Neptune for seven different potential customer
projects.
"Our Water and Flowback Services business is challenged with a
more difficult market environment, but we continue to make progress
with our strategic initiatives. We previously announced the
introduction of our latest sand separation technology which we have
branded as "SandStormTM". During a major operator
trial in the fourth quarter, the SandStormTM system
achieved greater than 95% sand removal efficiency, compared to the
more traditional sand cyclones removal efficiency of roughly 50%.
Upon completion of the trial we were immediately awarded a large
service project in the Permian Basin, which we are deploying in the
first quarter of this year. Despite a sequential revenue
reduction of 20% from the third quarter to the fourth quarter, in
line with overall completion activity, we increased the number of
integrated water management projects to a record of 28 during the
quarter as we continue to gain market share and customer acceptance
with this solution. While we expect this segment to be
challenged at least through the first half of 2020 given our
expectations that operators' capital budgets will be down 10% to
15% year-over-year, we feel confident that we can continue to
perform well in this market given our investments in and
deployments of technology that create differentiation.
"Our fourth quarter Compression segment results demonstrated the
continued growing strength of our compression business. The
fourth quarter loss before tax of $1.3
million compares to a loss before tax of $3.5 million in the third quarter of 2019.
Adjusted EBITDA of $32.6 million for
the fourth quarter was a sequential improvement of $1.3 million and only $0.2
million less than our record high accomplished in the second
quarter of 2019. Profit (loss) before tax margin for the fourth
quarter was negative 1.0% compared to a negative 3.0% for the third
quarter. This represents a 26.4% Adjusted EBITDA margin,
underpinned by 90% equipment utilization, essentially flat from a
record level of 90.1% in the third quarter of 2019. While the U.S.
onshore market continues to experience volatility and natural gas
prices have fallen below $2.00/Mcf,
this business delivered very strong results. Almost 90% of
our deployed compression services equipment in the fourth quarter
was directed towards centralized gas lift applications for liquids
or single well artificial lift applications for the growing
inventory of late-life horizontal wells. Customers continue
to trend more and more towards utilizing centralized gas lift as a
cost effective and efficient means to drive liquids production,
which drives demand for our equipment. While customer drilling
activity and new well capital expenditures are expected to decrease
in 2020, we see these applications continuing to grow.
"During the fourth quarter, consolidated cash provided by
operations was $5.3 million and TETRA
only adjusted free cash flow from continuing
operations(1) was $1.0
million, which was below our expectations due to the
delays in collection of key receivables, including a CS
Neptune receivable, and other notable completion fluid sales that
occurred in the fourth quarter 2019. These key receivables, which
were collected in the first two weeks of January, will positively
impact the first quarter 2020 TETRA only adjusted free cash flow
from continuing operations, offsetting the weaker than expected
fourth quarter free cash flow. TETRA only liquidity at the
end of 2019 improved approximately $28
million from the date of our last 10-K filing in March, 2019
and our first quarter 2020 TETRA only adjusted free cash flow from
continuing operations is expected to improve by more than
$25 million over first quarter
2019. TETRA only liquidity is defined as unrestricted cash on
hand plus availability under our revolving credit facility.
No reconciliation of the forecasted TETRA only adjusted free cash
flow from continuing operations in the first quarter of 2020 to the
nearest GAAP measure is included in this release because the
reconciliation would require presenting forecasted information for
CSI Compressco that is not otherwise publicly disclosed.
(1)
|
These financial
measures are not in accordance with generally accepted accounting
principles in the United States ("GAAP"). Please see
Schedules E, F, G, H. I, J and K for reconciliations of these
non-GAAP financial measures to the most directly comparable GAAP
measures.
|
A summary of key financial metrics for the fourth quarter is as
follows:
Fourth Quarter
2019 Results
|
|
Three Months
Ended
|
|
December 31,
2019
|
|
September 30,
2019
|
|
December 31,
2018
|
|
(In Thousands, Except
per Share Amounts)
|
Revenue
|
$
|
259,462
|
|
|
$
|
245,947
|
|
|
$
|
282,471
|
|
Income (loss) before
discontinued operations
|
(114,333)
|
|
|
(9,079)
|
|
|
3,316
|
|
Adjusted EBITDA
before discontinued operations(2)
|
54,532
|
|
|
46,157
|
|
|
46,609
|
|
GAAP EPS before
discontinued operations attributable to TETRA
stockholders
|
(0.91)
|
|
|
(0.06)
|
|
|
0.04
|
|
Adjusted EPS
attributable to TETRA stockholders(2)
|
0.03
|
|
|
(0.02)
|
|
|
(0.01)
|
|
GAAP net cash
provided (used) by operating activities
|
5,250
|
|
|
46,605
|
|
|
44,953
|
|
TETRA only adjusted
free cash flow from continuing operations(2)
|
$
|
982
|
|
|
$
|
9,749
|
|
|
$
|
15,598
|
|
|
|
(2)
|
These financial
measures are not in accordance with generally accepted accounting
principles in the United States ("GAAP"). Please see Schedules E,
F, G, H, I and J for the reconciliations of these non-GAAP
financial measures to the most directly comparable GAAP
measure.)
|
Operating Segments
Completion Fluids & Products Division
Completion Fluids & Products revenue was $79 million in the fourth quarter of 2019, an
increase of 32% from the third quarter of 2019 aided by the
completion of the CS Neptune project and very strong international
offshore fluid sales. Completion Fluids & Products
reported a loss before taxes of $66.1
in the fourth quarter of 2019 and profit (loss) before tax margin
of negative 84.1%, which included a previously announced
$91 million non-cash impairment to
our El Dorado, Arkansas facility,
which produces calcium chloride. Excluding the impairment,
Completion Fluids & Products Division Adjusted income before
taxes was $25.4 million, or 32.3% of
revenue. Adjusted EBITDA of $27.7
million increased by $13.6
million sequentially and Adjusted EBITDA margin was 35.2%,
an 1150 basis point improvement sequentially.
Water & Flowback Services Division
Water & Flowback Services fourth quarter 2019 revenue
decreased 21% sequentially to $57.3
million. Water & Flowback Services loss before tax
was $28.4 million, which included a
non-cash goodwill impairment and other special charges of
$26.3 million. Adjusted loss
before tax(1) was $2.1
million, resulting in Adjusted profit (loss) before tax
margin of negative 3.7%(1). Adjusted
EBITDA decreased $5.6 million
sequentially to $5.6 million. While
results in this division declined primarily due to challenging U.S.
land market conditions that impacted the entire oil and gas
industry, this division performed well relative to our
expectations.
Compression Division
Fourth quarter Compression revenue increased 9% from the third
quarter of 2019 driven by strong year-end equipment sales and
aftermarket services. Compression services gross margins were
51.5%, a 170 basis points decrease from the third quarter of
2019. Overall fleet utilization was 90.0%, compared to 90.1%
at the end of the third quarter. As of December 31, 2019, total active operating
horsepower was 1,059,590, a sequential improvement of over 16,200
horsepower that was all large horsepower additions targeted a
centralized gas lift application. Compression Division net loss
before taxes was $1.3 million, a
$2.2 million improvement
sequentially. Fourth quarter 2019 Adjusted EBITDA of
$32.6 million increased 4% from the
third quarter of 2019 primarily due to stronger aftermarket and
higher equipment sales. We received new equipment orders of
$4 million in the fourth
quarter. New equipment sales backlog was $36 million at December
31, 2019, compared to $63
million at the end of the previous quarter. While we
continue to see a healthy pipeline of new unit sales opportunities,
several large orders which we expected to receive in the fourth
quarter of 2019 or early 2020 have now been pushed towards the
second half of 2020.
Free Cash Flow and Balance Sheet
Consolidated net cash from operating activities for the fourth
quarter of 2019 was $5.3 million and
for the full year was $90.2
million. Payments from several large projects that
were expected before year-end were delayed into the first two weeks
of January of 2020. As a result, TETRA only adjusted free
cash flow from continuing operations for 2019 was a use of cash of
$21 million, which includes funding
approximately $15 million of
equipment that TETRA bought and leased to CSI Compressco,
supporting their high return opportunities. Had the payments
from those large projects been received a few days earlier, we
would have achieved positive TETRA only adjusted free cash flow
from continuing operations for the full year 2019. TETRA only
adjusted free cash flow from continuing operations in the fourth
quarter 2019 was $1.0 million.
Consolidated total debt was $843
million while consolidated net debt(1) was
$825 million, with TETRA only net
debt(1) of $189 million
(see Schedules H and I for reconciliations of these non-GAAP
financial measures). At the end of the fourth quarter TETRA
only non-restricted cash was $15.3
million.
Special items
Special items, including Discontinued Operations, incurred in
the fourth quarter, as detailed on Schedule F, include the
following:
- $117 million non-cash expense for
fixed assets/intangible and goodwill impairment, including
$91 million for the previously
announced El Dorado calcium
chloride plant
- $0.6 million non-cash gain for
TETRA stock warrant fair value adjustment
- $0.5 million of restructuring
expenses and severances and other charges
Additionally, a normalized tax rate of 21% is reflected in
Adjusted Net Income, as shown on Schedule F.
A summary of key financial metrics for the full year of 2019 and
2018 is as follows:
Total 2019
Results
|
|
Twelve months
ended
|
|
December 31,
2019
|
|
December 31,
2018
|
|
(In Thousands, Except
per Share Amounts)
|
|
|
Revenue
|
$
|
1,037,933
|
|
|
$
|
998,775
|
|
Loss before
discontinued operations
|
(150,287)
|
|
|
(42,725)
|
|
Adjusted
EBITDA(3)
|
187,144
|
|
|
160,918
|
|
GAAP EPS before
discontinued operations attributable to TETRA
stockholders
|
(1.09)
|
|
|
(0.16)
|
|
Adjusted diluted EPS
attributable to TETRA stockholders(3)
|
(0.05)
|
|
|
(0.05)
|
|
Consolidated net cash
provided (used) by operating activities
|
90,232
|
|
|
46,586
|
|
TETRA only adjusted
free cash flow from continuing operations(3)
|
$
|
(21,072)
|
|
|
$
|
3,101
|
|
|
|
(3)
|
Non-GAAP financial
measures are reconciled to GAAP in the schedules below.
|
Conference Call
TETRA will host a conference call to discuss these results
today, February 27, 2020, at
10:30 a.m. ET. The phone number for
the call is 1-888-347-5303. The conference call will also be
available by live audio webcast and may be accessed through the
Company's website at www.tetratec.com. A replay of the conference
call will be available at 1-877-344-7529 conference number
10138609, for one week following the conference call and the
archived webcast will be available through the Company's website
for thirty days following the conference call.
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 Cash
Flow From Continuing Operations
Schedule K: Non-GAAP Reconciliation to TETRA Adjusted EBITDA
Margins and Adjusted Income 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.
Cautionary Statement Regarding Forward Looking Statements
This news release includes certain statements that are deemed to
be forward-looking statements. Generally, the use of words such as
"may," "see," "expectation," "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 customer drilling activity and
capital spending for 2020 and 2021, 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. 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 Reports on Form 10-K, 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
December 31,
|
|
Twelve Months
Ended
December 31,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
(In Thousands, Except
per Share Amounts)
|
Revenues
|
$
|
259,462
|
|
|
$
|
282,471
|
|
|
$
|
1,037,933
|
|
|
$
|
998,775
|
|
|
|
|
|
|
|
|
|
Cost of sales,
services, and rentals
|
174,774
|
|
|
206,561
|
|
|
728,483
|
|
|
717,931
|
|
Depreciation,
amortization, and accretion
|
30,914
|
|
|
30,045
|
|
|
124,226
|
|
|
114,925
|
|
Impairments and other
charges
|
91,890
|
|
|
681
|
|
|
95,196
|
|
|
3,621
|
|
Insurance
recoveries
|
(379)
|
|
|
—
|
|
|
(1,771)
|
|
|
—
|
|
Total cost of
revenues
|
297,199
|
|
|
237,287
|
|
|
946,134
|
|
|
836,477
|
|
Gross profit
|
(37,737)
|
|
|
45,184
|
|
|
91,799
|
|
|
162,298
|
|
|
|
|
|
|
|
|
|
General and
administrative expense
|
34,249
|
|
|
33,580
|
|
|
139,747
|
|
|
132,446
|
|
Goodwill
impairment
|
25,784
|
|
|
—
|
|
|
25,784
|
|
|
—
|
|
Interest expense,
net
|
18,176
|
|
|
18,700
|
|
|
73,230
|
|
|
70,946
|
|
(Gain) loss on sales
of assets
|
(750)
|
|
|
(275)
|
|
|
(2,333)
|
|
|
(729)
|
|
Warrants fair value
adjustment (income) expense
|
(589)
|
|
|
(11,151)
|
|
|
(1,624)
|
|
|
(11,129)
|
|
CCLP Series A
Preferred Units fair value adjustment (income) expense
|
—
|
|
|
(2,077)
|
|
|
1,309
|
|
|
(733)
|
|
Other (income)
expense, net
|
(760)
|
|
|
266
|
|
|
(191)
|
|
|
7,923
|
|
Income (loss) before
taxes and discontinued operations
|
(113,847)
|
|
|
6,141
|
|
|
(144,123)
|
|
|
(36,426)
|
|
Provision (benefit)
for income taxes
|
486
|
|
|
2,825
|
|
|
6,164
|
|
|
6,299
|
|
Income (Loss) before
discontinued operations
|
(114,333)
|
|
|
3,316
|
|
|
(150,287)
|
|
|
(42,725)
|
|
Discontinued
operations:
|
|
|
|
|
|
|
|
Loss from
discontinued operations, net of taxes
|
(312)
|
|
|
(584)
|
|
|
(10,213)
|
|
|
(41,515)
|
|
Net income
(loss)
|
(114,645)
|
|
|
2,732
|
|
|
(160,500)
|
|
|
(84,240)
|
|
Less: net (income)
loss attributable to noncontrolling interest
|
814
|
|
|
2,200
|
|
|
13,087
|
|
|
22,623
|
|
Net income (loss)
attributable to TETRA stockholders
|
$
|
(113,831)
|
|
|
$
|
4,932
|
|
|
$
|
(147,413)
|
|
|
$
|
(61,617)
|
|
|
|
|
|
|
|
|
|
Basic per share
information:
|
|
|
|
|
|
|
|
Income (loss) before
discontinued operations attributable to TETRA
stockholders
|
$
|
(0.91)
|
|
|
$
|
0.04
|
|
|
$
|
(1.09)
|
|
|
$
|
(0.16)
|
|
Income (loss) from
discontinued operations attributable to TETRA
stockholders
|
0.00
|
|
|
0.00
|
|
|
(0.08)
|
|
|
(0.34)
|
|
Net income (loss)
attributable to TETRA stockholders
|
$
|
(0.91)
|
|
|
$
|
0.04
|
|
|
$
|
(1.17)
|
|
|
$
|
(0.50)
|
|
Weighted average shares
outstanding
|
125,541
|
|
|
125,717
|
|
|
125,600
|
|
|
124,101
|
|
|
|
|
|
|
|
|
|
Diluted per share
information:
|
|
|
|
|
|
|
|
Income (loss) before
discontinued operations attributable to TETRA
stockholders
|
$
|
(0.91)
|
|
|
$
|
0.04
|
|
|
$
|
(1.09)
|
|
|
$
|
(0.16)
|
|
Income (loss) from
discontinued operations attributable to TETRA
stockholders
|
0.00
|
|
|
0.00
|
|
|
(0.08)
|
|
|
(0.34)
|
|
Net income (loss)
attributable to TETRA stockholders
|
$
|
(0.91)
|
|
|
$
|
0.04
|
|
|
$
|
(1.17)
|
|
|
$
|
(0.50)
|
|
Weighted average shares
outstanding
|
125,541
|
|
|
125,789
|
|
|
125,600
|
|
|
124,101
|
|
Schedule B:
Financial Results By Segment (Unaudited)
|
|
|
Three Months
Ended
December 31,
|
|
Twelve Months
Ended
December 31,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
(In
Thousands)
|
Revenues by
segment:
|
|
|
|
|
|
|
|
Completion Fluids &
Products Division
|
$
|
78,567
|
|
|
$
|
64,675
|
|
|
$
|
279,255
|
|
|
$
|
257,408
|
|
Water & Flowback
Services Division
|
57,343
|
|
|
79,783
|
|
|
281,986
|
|
|
303,072
|
|
Compression
Division
|
123,552
|
|
|
138,066
|
|
|
476,692
|
|
|
438,673
|
|
Eliminations and
other
|
—
|
|
|
(53)
|
|
|
—
|
|
|
(378)
|
|
Total
revenues
|
$
|
259,462
|
|
|
$
|
282,471
|
|
|
$
|
1,037,933
|
|
|
$
|
998,775
|
|
|
|
|
|
|
|
|
|
Gross profit
(loss) by segment:
|
|
|
|
|
|
|
|
Completion Fluids &
Products Division
|
$
|
(61,687)
|
|
|
$
|
14,464
|
|
|
$
|
(15,034)
|
|
|
$
|
48,675
|
|
Water & Flowback
Services Division
|
2,881
|
|
|
13,691
|
|
|
27,458
|
|
|
55,247
|
|
Compression
Division
|
21,188
|
|
|
17,197
|
|
|
79,992
|
|
|
59,017
|
|
Eliminations and
other
|
(119)
|
|
|
(168)
|
|
|
(617)
|
|
|
(641)
|
|
Total gross
profit
|
$
|
(37,737)
|
|
|
$
|
45,184
|
|
|
$
|
91,799
|
|
|
$
|
162,298
|
|
|
|
|
|
|
|
|
|
Income (loss)
before taxes by segment:
|
|
|
|
|
|
|
|
Completion Fluids &
Products Division
|
$
|
(66,087)
|
|
|
$
|
9,480
|
|
|
$
|
(33,969)
|
|
|
$
|
30,623
|
|
Water & Flowback
Services Division
|
(28,442)
|
|
|
8,044
|
|
|
(21,173)
|
|
|
28,712
|
|
Compression
Division
|
(1,266)
|
|
|
(3,280)
|
|
|
(16,014)
|
|
|
(33,797)
|
|
Eliminations and
other
|
(18,052)
|
|
|
(8,103)
|
|
|
(72,967)
|
|
|
(61,964)
|
|
Total income (loss)
before taxes
|
$
|
(113,847)
|
|
|
$
|
6,141
|
|
|
$
|
(144,123)
|
|
|
$
|
(36,426)
|
|
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.
Schedule C:
Consolidated Balance Sheet (Unaudited)
|
|
|
|
|
|
December 31,
2019
|
|
December 31,
2018
|
|
(In
Thousands)
|
Balance
Sheet:
|
|
|
|
Cash (excluding
restricted cash)
|
$
|
17,704
|
|
|
$
|
40,038
|
|
Accounts receivable,
net
|
176,513
|
|
|
187,592
|
|
Inventories
|
136,510
|
|
|
143,571
|
|
Assets of
discontinued operations
|
—
|
|
|
1,354
|
|
Note receivable,
including accrued interest
|
—
|
|
|
7,544
|
|
Other current
assets
|
20,627
|
|
|
20,592
|
|
PP&E,
net
|
758,637
|
|
|
853,931
|
|
Other
assets
|
161,931
|
|
|
130,905
|
|
Total
assets
|
$
|
1,271,922
|
|
|
$
|
1,385,527
|
|
|
|
|
|
Liabilities of
discontinued operations
|
$
|
2,098
|
|
|
$
|
4,145
|
|
Other current
liabilities
|
186,625
|
|
|
196,206
|
|
Long-term debt
(1)
|
842,871
|
|
|
815,560
|
|
Long-term portion of
asset retirement obligations
|
12,762
|
|
|
12,202
|
|
CCLP Series A
Preferred
|
—
|
|
|
27,019
|
|
Warrants
liability
|
449
|
|
|
2,073
|
|
Operating lease
liabilities
|
53,919
|
|
|
—
|
|
Other long-term
liabilities
|
10,372
|
|
|
15,573
|
|
Equity
|
162,826
|
|
|
312,749
|
|
Total liabilities and
equity
|
$
|
1,271,922
|
|
|
$
|
1,385,527
|
|
|
|
(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 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 are net of deferred financing
costs.
|
December 31,
2019
|
|
December 31,
2018
|
|
(In
Thousands)
|
TETRA
|
|
|
|
Asset-based credit
agreement
|
$
|
—
|
|
|
$
|
—
|
|
Term credit
agreement
|
204,633
|
|
|
182,547
|
|
TETRA total
debt
|
204,633
|
|
|
182,547
|
|
Less current
portion
|
—
|
|
|
—
|
|
TETRA total
long-term debt
|
$
|
204,633
|
|
|
$
|
182,547
|
|
|
|
|
|
CSI Compressco
LP
|
|
|
|
CCLP Credit
Agreement
|
2,622
|
|
|
—
|
|
7.25% Senior
Notes
|
291,444
|
|
|
289,797
|
|
7.50% Senior Secured
Notes
|
344,172
|
|
|
343,216
|
|
Total debt
|
638,238
|
|
|
633,013
|
|
Less current
portion
|
—
|
|
|
—
|
|
CCLP total
long-term debt
|
$
|
638,238
|
|
|
$
|
633,013
|
|
Consolidated total
long-term debt
|
$
|
842,871
|
|
|
$
|
815,560
|
|
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) 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 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
|
|
December 31,
2019
|
|
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 special items and
discontinued operations
|
$
|
3,574
|
|
$
|
752
|
|
$
|
(814)
|
|
$
|
3,636
|
|
$
|
0.03
|
|
Stock Warrant fair
value adjustment
|
588
|
|
123
|
|
—
|
|
465
|
|
0.00
|
|
Earnout
Adjustment
|
200
|
|
42
|
|
—
|
|
158
|
|
0.00
|
|
Lee Plant Facility
Vandalism
|
202
|
|
42
|
|
—
|
|
160
|
|
0.00
|
|
Transaction
Expense
|
(185)
|
|
(39)
|
|
—
|
|
(146)
|
|
0.00
|
|
Impairments and other
charges
|
(91,890)
|
|
(19,297)
|
|
—
|
|
(72,593)
|
|
(0.58)
|
|
Goodwill
Impairment
|
(25,784)
|
|
(5,415)
|
|
—
|
|
(20,369)
|
|
(0.16)
|
|
Restructuring
charges
|
(552)
|
|
(116)
|
|
—
|
|
(436)
|
|
0.00
|
|
Effect of deferred tax
valuation allowance and other related tax adjustments
|
—
|
|
24,394
|
|
—
|
|
(24,394)
|
|
(0.19)
|
|
Net income (loss)
before discontinued operations
|
(113,847)
|
|
486
|
|
(814)
|
|
(113,519)
|
|
(0.91)
|
|
Loss from discontinued
operations
|
|
|
|
(312)
|
|
0.00
|
|
Net Income (loss)
attributable to TETRA stockholders, as reported
|
|
|
|
$
|
(113,831)
|
|
$
|
(0.91)
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
September 30,
2019
|
|
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 special items and
discontinued operations
|
$
|
(4,143)
|
|
$
|
(871)
|
|
$
|
(354)
|
|
$
|
(2,918)
|
|
$
|
(0.02)
|
|
Stock Warrant fair
value adjustment
|
(78)
|
|
(16)
|
|
—
|
|
(62)
|
|
0.00
|
|
5% Cash Redemption on
CCLP Series A Preferred
|
(341)
|
|
(72)
|
|
(238)
|
|
(31)
|
|
0.00
|
|
Lee Plant Facility
Vandalism
|
736
|
|
155
|
|
—
|
|
581
|
|
0.00
|
|
Transaction
Expense
|
(643)
|
|
(135)
|
|
(152)
|
|
(356)
|
|
0.00
|
|
Severance
|
(339)
|
|
(71)
|
|
(70)
|
|
(198)
|
|
0.00
|
|
Bad debt
|
(1,844)
|
|
(387)
|
|
(1,057)
|
|
(400)
|
|
0.00
|
|
Impairments and other
charges
|
(848)
|
|
(178)
|
|
(507)
|
|
(163)
|
|
0.00
|
|
Effect of deferred tax
valuation allowance and other related tax adjustments
|
—
|
|
3,154
|
|
—
|
|
(3,154)
|
|
(0.03)
|
|
Net income (loss)
before discontinued operations
|
(7,500)
|
|
1,579
|
|
(2,378)
|
|
(6,701)
|
|
(0.06)
|
|
Loss from discontinued
operations
|
|
|
|
(9,130)
|
|
(0.07)
|
|
Net Income (loss)
attributable to TETRA stockholders, as reported
|
|
|
|
|
|
|
|
|
|
$
|
(15,831)
|
|
$
|
(0.13)
|
|
|
Three Months
Ended
|
|
December 31,
2018
|
|
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 special items and
discontinued operations
|
$
|
(3,822)
|
|
$
|
(803)
|
|
$
|
(1,909)
|
|
$
|
(1,110)
|
|
$
|
(0.01)
|
|
Stock Warrant fair
value adjustment
|
11,150
|
|
2,342
|
|
—
|
|
8,808
|
|
0.07
|
|
Convertible Series A
preferred fair value adjustments
|
2,077
|
|
436
|
|
1,662
|
|
(21)
|
|
0.00
|
|
Other costs and
expenses
|
(773)
|
|
(162)
|
|
—
|
|
(611)
|
|
0.00
|
|
Earnout
adjustment
|
300
|
|
63
|
|
—
|
|
237
|
|
0.00
|
|
Sales tax
adjustment
|
(2,110)
|
|
(443)
|
|
(1,476)
|
|
(191)
|
|
0.00
|
|
Intangible
Impairment
|
(681)
|
|
(143)
|
|
(477)
|
|
(61)
|
|
0.00
|
|
Effect of deferred
tax valuation allowance and other related tax
adjustments
|
—
|
|
1,535
|
|
—
|
|
(1,535)
|
|
(0.01)
|
|
Net income (loss)
before discontinued operations
|
6,141
|
|
2,825
|
|
(2,200)
|
|
5,516
|
|
0.04
|
|
Loss from discontinued
operations
|
|
|
|
(584)
|
|
0.00
|
|
Net Income (loss)
attributable to TETRA stockholders, as reported
|
|
|
|
$
|
4,932
|
|
$
|
0.04
|
|
|
Twelve Months
Ended
|
|
December 31,
2019
|
|
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 special items and
discontinued operations
|
$
|
(17,955)
|
|
$
|
(3,765)
|
|
$
|
(7,649)
|
|
$
|
(6,541)
|
|
$
|
(0.05)
|
|
Stock Warrant fair
value adjustment
|
1,624
|
|
341
|
|
—
|
|
1,283
|
|
0.01
|
|
Convertible Series A
preferred fair value adjustments
|
(1,309)
|
|
(279)
|
|
(1,408)
|
|
378
|
|
0.00
|
|
5% Cash Redemption on
CCLP Series A Preferred
|
(1,259)
|
|
(265)
|
|
(974)
|
|
(20)
|
|
0.00
|
|
Earnout
adjustment
|
1,000
|
|
210
|
|
—
|
|
790
|
|
0.01
|
|
Lee Plant Facility
Vandalism
|
691
|
|
145
|
|
—
|
|
546
|
|
0.00
|
|
Lee Plant Asset
Impairment
|
(146)
|
|
(31)
|
|
—
|
|
(115)
|
|
0.00
|
|
CEO
Retirement
|
(1,843)
|
|
(387)
|
|
—
|
|
(1,456)
|
|
(0.01)
|
|
Transaction
Expense
|
(1,204)
|
|
(253)
|
|
(320)
|
|
(631)
|
|
(0.01)
|
|
Inventory
Adjustment
|
(153)
|
|
(32)
|
|
(68)
|
|
(53)
|
|
0.00
|
|
Asset
Impairment
|
(95,050)
|
|
(19,960)
|
|
(1,541)
|
|
(73,549)
|
|
(0.59)
|
|
Severance
|
(339)
|
|
(71)
|
|
(70)
|
|
(198)
|
|
0.00
|
|
Bad Debt
|
(1,844)
|
|
(387)
|
|
(1,057)
|
|
(400)
|
|
0.00
|
|
Goodwill
Impairment
|
(25,784)
|
|
(5,415)
|
|
—
|
|
(20,369)
|
|
(0.16)
|
|
Restructuring
charges
|
(552)
|
|
(116)
|
|
—
|
|
(436)
|
|
0.00
|
|
Effect of Deferred Tax
Valuation Allowance and other related tax adjustments
|
—
|
|
36,429
|
|
—
|
|
(36,429)
|
|
(0.29)
|
|
Net Income (loss)
before discontinued operations
|
(144,123)
|
|
6,164
|
|
(13,087)
|
|
(137,200)
|
|
(1.09)
|
|
Loss from discontinued
operations
|
|
|
|
(10,213)
|
|
(0.08)
|
|
Net Income (loss)
attributable to TETRA stockholders, as reported
|
|
|
|
$
|
(147,413)
|
|
$
|
(1.17)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months
Ended
|
|
December 31,
2018
|
|
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 special items and
discontinued operations
|
$
|
(32,334)
|
|
$
|
(6,734)
|
|
$
|
(19,044)
|
|
$
|
(6,556)
|
|
$
|
(0.05)
|
|
Severance
expense
|
(116)
|
|
(24)
|
|
(9)
|
|
(83)
|
|
0.00
|
|
Stock Warrant fair
value adjustment
|
11,129
|
|
2,338
|
|
1,662
|
|
7,129
|
|
0.06
|
|
Convertible Series A
preferred fair value adjustments
|
733
|
|
154
|
|
(929)
|
|
1,508
|
|
0.01
|
|
Prior debt issuance
costs
|
(3,541)
|
|
(744)
|
|
(2,238)
|
|
(559)
|
|
0.00
|
|
Other costs and
expenses
|
(2,126)
|
|
(445)
|
|
(112)
|
|
(1,569)
|
|
(0.01)
|
|
Earnout
adjustment
|
(3,400)
|
|
(714)
|
|
—
|
|
(2,686)
|
|
(0.02)
|
|
Financing
costs
|
(1,040)
|
|
(218)
|
|
—
|
|
(822)
|
|
(0.01)
|
|
Sales tax
adjustment
|
(2,110)
|
|
(443)
|
|
(1,476)
|
|
(191)
|
|
0.00
|
|
Asset
Impairment
|
(3,621)
|
|
(760)
|
|
(477)
|
|
(2,384)
|
|
(0.02)
|
|
Effect of deferred
tax valuation allowance and other related tax
adjustments
|
—
|
|
13,889
|
|
—
|
|
(13,889)
|
|
(0.11)
|
|
Net Income (loss)
before discontinued operations
|
(36,426)
|
|
6,299
|
|
(22,623)
|
|
(20,102)
|
|
(0.16)
|
|
Loss from
discontinued operations
|
|
|
|
(41,515)
|
|
(0.34)
|
|
Net Income (loss)
attributable to TETRA stockholders, as reported
|
|
|
|
$
|
(61,617)
|
|
$
|
(0.50)
|
|
|
|
|
|
|
|
Schedule G:
Non-GAAP Reconciliation to GAAP Financials
(Unaudited)
|
|
Three Months
Ended
|
December 31,
2019
|
|
Net
Income
(Loss), as
reported
|
Tax
Provision
|
Income
(Loss)
Before
Tax, as
Reported
|
Impairments
& Special
Charges
|
Adjusted
Income
(Loss)
Before
Tax
|
Adjusted
Interest
Expense,
Net
|
Adjusted Depreciation
&
Amortization
|
Equity
Comp.
Expense
|
Adjusted
EBITDA
|
|
(In
Thousands)
|
Completion Fluids &
Products Division
|
|
|
$
|
(66,086)
|
|
$
|
91,482
|
|
$
|
25,396
|
|
$
|
(167)
|
|
$
|
2,454
|
|
$
|
—
|
|
$
|
27,683
|
|
Water & Flowback
Services Division
|
|
|
(28,441)
|
|
26,343
|
|
(2,098)
|
|
5
|
|
7,717
|
|
—
|
|
5,624
|
|
Compression
Division
|
|
|
(1,265)
|
|
—
|
|
(1,265)
|
|
12,894
|
|
20,618
|
|
320
|
|
32,567
|
|
Eliminations and
other
|
|
|
5
|
|
—
|
|
5
|
|
—
|
|
(4)
|
|
—
|
|
1
|
|
Subtotal
|
|
|
(95,787)
|
|
117,825
|
|
22,038
|
|
12,732
|
|
30,785
|
|
320
|
|
65,875
|
|
Corporate and
other
|
|
|
(18,060)
|
|
(403)
|
|
(18,463)
|
|
5,444
|
|
129
|
|
1,547
|
|
(11,343)
|
|
TETRA excluding
Discontinued Operations
|
$
|
(114,333)
|
|
$
|
486
|
|
$
|
(113,847)
|
|
$
|
117,422
|
|
$
|
3,575
|
|
$
|
18,176
|
|
$
|
30,914
|
|
$
|
1,867
|
|
$
|
54,532
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
September 30,
2019
|
|
Net
Income
(Loss), as
reported
|
Tax
Provision
|
Income
(Loss)
Before
Tax, as
Reported
|
Impairments
& Special
Charges
|
Adjusted
Income
(Loss)
Before
Tax
|
Interest
Expense
|
Adjusted Depreciation
&
Amortization
|
Equity
Comp.
Expense
|
Adjusted
EBITDA
|
|
(In
Thousands)
|
Completion Fluids &
Products Division
|
|
|
$
|
11,318
|
|
$
|
(736)
|
|
$
|
10,582
|
|
$
|
(216)
|
|
$
|
3,676
|
|
$
|
—
|
|
$
|
14,042
|
|
Water & Flowback
Services Division
|
|
|
2,578
|
|
76
|
|
2,654
|
|
(2)
|
|
8,568
|
|
—
|
|
11,220
|
|
Compression
Division
|
|
|
(3,464)
|
|
3,597
|
|
133
|
|
12,869
|
|
18,459
|
|
(211)
|
|
31,250
|
|
Eliminations and
other
|
|
|
(1)
|
|
—
|
|
(1)
|
|
—
|
|
(3)
|
|
—
|
|
(4)
|
|
Subtotal
|
|
|
10,431
|
|
2,937
|
|
13,368
|
|
12,651
|
|
30,700
|
|
(211)
|
|
56,508
|
|
Corporate and
other
|
|
|
(17,931)
|
|
379
|
|
(17,552)
|
|
5,495
|
|
167
|
|
1,539
|
|
(10,351)
|
|
TETRA excluding
Discontinued Operations
|
$
|
(9,079)
|
|
$
|
1,579
|
|
$
|
(7,500)
|
|
$
|
3,316
|
|
$
|
(4,184)
|
|
$
|
18,146
|
|
$
|
30,867
|
|
$
|
1,328
|
|
$
|
46,157
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
December 31,
2018
|
|
Net
Income
(Loss), as
reported
|
Tax
Provision
|
Income
(Loss)
Before
Tax, as
Reported
|
Impairments
& Special
Charges
|
Adjusted
Income
(Loss)
Before
Tax
|
Adjusted
Interest
Expense,
Net
|
Depreciation
&
Amortization
|
Adjusted
Equity
Comp.
Expense
|
Adjusted
EBITDA
|
|
(In
Thousands)
|
Completion Fluids &
Products Division
|
|
|
$
|
9,480
|
|
$
|
—
|
|
$
|
9,480
|
|
$
|
(164)
|
|
$
|
3,723
|
|
$
|
—
|
|
$
|
13,039
|
|
Water & Flowback
Services Division
|
|
|
8,043
|
|
(300)
|
|
7,743
|
|
10
|
|
8,151
|
|
—
|
|
15,904
|
|
Compression
Division
|
|
|
(3,282)
|
|
714
|
|
(2,568)
|
|
13,367
|
|
18,004
|
|
380
|
|
29,183
|
|
Eliminations and
other
|
|
|
4
|
|
—
|
|
4
|
|
—
|
|
(4)
|
|
—
|
|
—
|
|
Subtotal
|
|
|
14,245
|
|
414
|
|
14,659
|
|
13,213
|
|
29,874
|
|
380
|
|
58,126
|
|
Corporate and
other
|
|
|
(8,104)
|
|
(10,377)
|
|
(18,481)
|
|
5,487
|
|
171
|
|
1,306
|
|
(11,517)
|
|
TETRA excluding
Discontinued Operations
|
$
|
3,316
|
|
$
|
2,825
|
|
$
|
6,141
|
|
$
|
(9,963)
|
|
$
|
(3,822)
|
|
$
|
18,700
|
|
$
|
30,045
|
|
$
|
1,686
|
|
$
|
46,609
|
|
|
Twelve Months
Ended
|
|
December 31,
2019
|
|
Net
Income
(Loss), as
reported
|
Tax
Provision
|
Income
(Loss)
Before
Tax, as
Reported
|
Impairments
& Special
Charges
|
Adjusted
Income
(Loss)
Before
Tax
|
Adjusted
Interest
Expense,
Net
|
Adjusted
Depreciation
&
Amortization
|
Equity
Comp.
Expense
|
Adjusted
EBITDA
|
|
(In
Thousands)
|
Completion Fluids &
Products Division
|
|
|
$
|
(33,969)
|
|
$
|
91,140
|
|
$
|
57,171
|
|
$
|
(720)
|
|
$
|
13,518
|
|
$
|
—
|
|
$
|
69,969
|
|
Water & Flowback
Services Division
|
|
|
(21,173)
|
|
25,619
|
|
4,446
|
|
(1)
|
|
33,424
|
|
—
|
|
37,869
|
|
Compression
Division
|
|
|
(16,014)
|
|
8,814
|
|
(7,200)
|
|
51,974
|
|
76,663
|
|
1,064
|
|
122,501
|
|
Eliminations and
other
|
|
|
14
|
|
—
|
|
14
|
|
—
|
|
(14)
|
|
—
|
|
—
|
|
Subtotal
|
|
|
(71,142)
|
|
125,573
|
|
54,431
|
|
51,253
|
|
123,591
|
|
1,064
|
|
230,339
|
|
Corporate and
other
|
|
|
(72,981)
|
|
111
|
|
(72,870)
|
|
21,977
|
|
635
|
|
7,063
|
|
(43,195)
|
|
TETRA excluding
Discontinued Operations
|
$
|
(150,287)
|
|
$
|
6,164
|
|
$
|
(144,123)
|
|
$
|
125,684
|
|
$
|
(18,439)
|
|
$
|
73,230
|
|
$
|
124,226
|
|
$
|
8,127
|
|
$
|
187,144
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months
Ended
|
|
December 31,
2018
|
|
Net
Income
(Loss), as
reported
|
Tax
Provision
|
Income
(Loss)
Before
Tax, as
Reported
|
Impairments
& Special
Charges
|
Adjusted
Income
(Loss)
Before
Tax
|
Adjusted
Interest
Expense,
Net
|
Depreciation
&
Amortization
|
Adjusted
Equity
Comp.
Expense
|
Adjusted
EBITDA
|
|
(In
Thousands)
|
Completion Fluids &
Products Division
|
|
|
$
|
30,623
|
|
$
|
70
|
|
$
|
30,693
|
|
$
|
(599)
|
|
$
|
15,345
|
|
$
|
—
|
|
$
|
45,439
|
|
Water & Flowback
Services Division
|
|
|
28,712
|
|
6,373
|
|
35,085
|
|
—
|
|
28,439
|
|
—
|
|
63,524
|
|
Compression
Division
|
|
|
(33,797)
|
|
5,788
|
|
(28,009)
|
|
51,905
|
|
70,500
|
|
639
|
|
95,035
|
|
Eliminations and
other
|
|
|
11
|
|
—
|
|
11
|
|
—
|
|
(17)
|
|
—
|
|
(6)
|
|
Subtotal
|
|
|
25,549
|
|
12,231
|
|
37,780
|
|
51,306
|
|
114,267
|
|
639
|
|
203,992
|
|
Corporate and
other
|
|
|
(61,975)
|
|
(8,137)
|
|
(70,112)
|
|
19,640
|
|
658
|
|
6,740
|
|
(43,074)
|
|
TETRA excluding
Discontinued Operations
|
$
|
(42,725)
|
|
$
|
6,299
|
|
$
|
(36,426)
|
|
$
|
4,094
|
|
$
|
(32,332)
|
|
$
|
70,946
|
|
$
|
114,925
|
|
$
|
7,379
|
|
$
|
160,918
|
|
|
|
|
|
|
|
|
|
|
|
Schedule H: Non-GAAP Reconciliation of TETRA Net Debt
(Unaudited)
The cash and debt positions of TETRA and CSI Compressco LP as of
December 31, 2019, 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.
|
December 31,
2019
|
|
TETRA
|
|
CCLP
|
|
Consolidated
|
|
(In
Millions)
|
Non-restricted
cash
|
$
|
15.3
|
|
|
$
|
2.4
|
|
|
$
|
17.7
|
|
|
|
|
|
|
|
Carrying value of
long-term debt:
|
|
|
|
|
|
Asset-Based Credit
Agreement
|
—
|
|
|
2.6
|
|
|
2.6
|
|
Term Credit
Agreement
|
204.6
|
|
|
—
|
|
|
204.6
|
|
Senior Notes
outstanding
|
—
|
|
|
635.6
|
|
|
635.6
|
|
Net debt
|
$
|
189.3
|
|
|
$
|
635.8
|
|
|
$
|
825.1
|
|
Schedule I:
Non-GAAP Reconciliation to TETRA Only Adjusted Free Cash Flow
(Unaudited)
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
Dec 31,
2019
|
|
Sep 30,
2019
|
|
Dec 31,
2018
|
|
Dec 31,
2019
|
|
Dec 31,
2018
|
|
(In
Thousands)
|
Consolidated
|
|
|
|
|
|
|
|
|
|
Net cash provided
(used) by operating activities
|
$
|
5,250
|
|
|
$
|
46,605
|
|
|
$
|
44,953
|
|
|
$
|
90,232
|
|
|
$
|
46,586
|
|
ARO
settlements
|
—
|
|
|
—
|
|
|
35
|
|
|
—
|
|
|
35
|
|
Capital expenditures,
net of sales proceeds
|
(8,348)
|
|
|
(27,650)
|
|
|
(34,487)
|
|
|
(95,388)
|
|
|
(140,793)
|
|
Consolidated adjusted
free cash flow
|
(3,098)
|
|
|
18,955
|
|
|
10,501
|
|
|
(5,156)
|
|
|
(94,172)
|
|
|
|
|
|
|
|
|
|
|
|
CSI Compressco
LP
|
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
(90)
|
|
|
27,444
|
|
|
23,605
|
|
|
67,696
|
|
|
30,121
|
|
Capital expenditures,
net of sales proceeds
|
(4,320)
|
|
|
(20,867)
|
|
|
(25,325)
|
|
|
(64,773)
|
|
|
(103,489)
|
|
CSI Compressco free
cash flow
|
(4,410)
|
|
|
6,577
|
|
|
(1,720)
|
|
|
2,923
|
|
|
(73,368)
|
|
|
|
|
|
|
|
|
|
|
|
TETRA
Only
|
|
|
|
|
|
|
|
|
|
Cash from operating
activities
|
5,340
|
|
|
19,161
|
|
|
21,348
|
|
|
22,536
|
|
|
16,465
|
|
ARO
settlements
|
—
|
|
|
—
|
|
|
35
|
|
|
—
|
|
|
35
|
|
Investment in CCLP
Compressors
|
(810)
|
|
|
(2,830)
|
|
|
—
|
|
|
(14,782)
|
|
|
—
|
|
Capital expenditures,
net of sales proceeds
|
(4,028)
|
|
|
(6,783)
|
|
|
(9,162)
|
|
|
(30,615)
|
|
|
(37,304)
|
|
Free cash flow before
ARO settlements
|
502
|
|
|
9,548
|
|
|
12,221
|
|
|
(22,861)
|
|
|
(20,804)
|
|
Distributions from CSI
Compressco LP
|
168
|
|
|
169
|
|
|
3,087
|
|
|
674
|
|
|
12,070
|
|
Adjusted free cash
flow
|
670
|
|
|
9,717
|
|
|
15,308
|
|
|
(22,187)
|
|
|
(8,734)
|
|
Schedule J:
Non-GAAP Reconciliation to TETRA Only Adjusted Cash Flow From
Continuing Operations (Unaudited)
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
Dec 31,
2019
|
|
Sep 30,
2019
|
|
Dec 31,
2018
|
|
Dec 31,
2019
|
|
Dec 31,
2018
|
TETRA Only
|
|
|
|
|
|
|
|
|
|
Cash from operating
activities
|
5,340
|
|
|
19,161
|
|
|
21,348
|
|
|
22,536
|
|
|
16,465
|
|
Less: Discontinued
operations operating activities (adjusted EBITDA)
|
(312)
|
|
|
(32)
|
|
|
(325)
|
|
|
(1,115)
|
|
|
(10,184)
|
|
Cash from continued
operating activities
|
5,652
|
|
|
19,193
|
|
|
21,673
|
|
|
23,651
|
|
|
26,649
|
|
Less: Continuing
operations capital expenditures
|
(4,028)
|
|
|
(6,783)
|
|
|
(9,162)
|
|
|
(30,615)
|
|
|
(35,618)
|
|
Less: Investment in
CCLP Compressors
|
(810)
|
|
|
(2,830)
|
|
|
—
|
|
|
(14,782)
|
|
|
—
|
|
Plus: Distributions
from CSI Compressco LP
|
168
|
|
|
169
|
|
|
3,087
|
|
|
674
|
|
|
12,070
|
|
TETRA only adjusted
free cash flow from continuing operations
|
982
|
|
|
9,749
|
|
|
15,598
|
|
|
(21,072)
|
|
|
3,101
|
|
Schedule K:
Non-GAAP Reconciliation to TETRA Adjusted EBITDA Margins and
Adjusted Income (Loss) before tax margins
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
Dec 31,
2019
|
|
Sep 30,
2019
|
|
Dec 31,
2018
|
|
Dec 31,
2019
|
|
Dec 31,
2018
|
|
|
(In
Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
259,462
|
|
|
$
|
245,947
|
|
|
$
|
282,471
|
|
|
$
|
1,037,933
|
|
|
$
|
998,775
|
|
Income (Loss) Before
Tax
|
|
(113,847)
|
|
|
(7,500)
|
|
|
6,141
|
|
|
(144,123)
|
|
|
(36,426)
|
|
Adjusted income
(loss) before tax (Schedule G)
|
|
3,575
|
|
|
(4,184)
|
|
|
(3,822)
|
|
|
(18,724)
|
|
|
(32,332)
|
|
Adjusted EBITDA
(Schedule G)
|
|
54,532
|
|
|
46,157
|
|
|
46,609
|
|
|
187,144
|
|
|
160,918
|
|
Income (Loss) Before
Tax Margin
|
|
(43.9)
|
%
|
|
(3.0)
|
%
|
|
2.2
|
%
|
|
(13.9)
|
%
|
|
(3.6)
|
%
|
Adjusted Income
(Loss) Before Tax Margin
|
|
1.4
|
%
|
|
(1.7)
|
%
|
|
(1.4)
|
%
|
|
(1.8)
|
%
|
|
(3.2)
|
%
|
Adjusted EBITDA
Margin
|
|
21.0
|
%
|
|
18.8
|
%
|
|
16.5
|
%
|
|
18.0
|
%
|
|
16.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Completion Fluids
& Products
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
78,567
|
|
|
$
|
59,340
|
|
|
$
|
64,675
|
|
|
$
|
279,255
|
|
|
$
|
257,408
|
|
Income Before
Tax
|
|
(66,087)
|
|
|
11,318
|
|
|
9,480
|
|
|
(33,969)
|
|
|
30,623
|
|
Adjusted income
before tax (Schedule G)
|
|
25,396
|
|
|
10,582
|
|
|
9,480
|
|
|
57,171
|
|
|
30,693
|
|
Adjusted EBITDA
(Schedule G)
|
|
27,683
|
|
|
14,042
|
|
|
13,039
|
|
|
69,969
|
|
|
45,439
|
|
Income (Loss) Before
Tax Margin
|
|
32.3
|
%
|
|
19.1
|
%
|
|
14.7
|
%
|
|
(12.2)
|
%
|
|
11.9
|
%
|
Adjusted Income
(Loss) Before Tax Margin
|
|
(84.1)
|
%
|
|
17.8
|
%
|
|
14.7
|
%
|
|
20.5
|
%
|
|
11.9
|
%
|
Adjusted EBITDA
Margin
|
|
35.2
|
%
|
|
23.7
|
%
|
|
20.2
|
%
|
|
25.1
|
%
|
|
17.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Water &
Flowback Services
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
57,343
|
|
|
$
|
72,841
|
|
|
$
|
79,783
|
|
|
$
|
281,986
|
|
|
$
|
303,072
|
|
Income Before
Tax
|
|
(28,442)
|
|
|
2,578
|
|
|
8,044
|
|
|
(21,173)
|
|
|
28,712
|
|
Adjusted income
before tax (Schedule G)
|
|
(2,098)
|
|
|
2,654
|
|
|
7,743
|
|
|
4,161
|
|
|
35,085
|
|
Adjusted EBITDA
(Schedule G)
|
|
5,624
|
|
|
11,220
|
|
|
15,904
|
|
|
37,584
|
|
|
63,524
|
|
Income (Loss) Before
Tax Margin
|
|
(49.6)
|
%
|
|
3.5
|
%
|
|
10.1
|
%
|
|
(7.5)
|
%
|
|
9.5
|
%
|
Adjusted Income
(Loss) Before Tax Margin
|
|
(3.7)
|
%
|
|
3.6
|
%
|
|
9.7
|
%
|
|
1.5
|
%
|
|
11.6
|
%
|
Adjusted EBITDA
Margin
|
|
9.8
|
%
|
|
15.4
|
%
|
|
19.9
|
%
|
|
13.3
|
%
|
|
21.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Compression
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
123,552
|
|
|
$
|
113,766
|
|
|
$
|
138,066
|
|
|
$
|
476,692
|
|
|
$
|
438,673
|
|
Income Before
Tax
|
|
(1,266)
|
|
|
(3,464)
|
|
|
(3,280)
|
|
|
(16,014)
|
|
|
(33,797)
|
|
Adjusted Income
Before Tax (Schedule G)
|
|
(1,265)
|
|
|
133
|
|
|
(2,568)
|
|
|
(7,200)
|
|
|
(28,009)
|
|
Adjusted EBITDA
(Schedule G)
|
|
32,567
|
|
|
31,250
|
|
|
29,183
|
|
|
122,501
|
|
|
95,035
|
|
Income (Loss) Before
Tax Margin
|
|
(1.0)
|
%
|
|
(3.0)
|
%
|
|
(2.4)
|
%
|
|
(3.4)
|
%
|
|
(7.7)
|
%
|
Adjusted Income
(Loss) Before Tax Margin
|
|
(1.0)
|
%
|
|
0.1
|
%
|
|
(1.9)
|
%
|
|
(1.5)
|
%
|
|
(6.4)
|
%
|
Adjusted EBITDA
Margin
|
|
26.4
|
%
|
|
27.5
|
%
|
|
21.1
|
%
|
|
25.7
|
%
|
|
21.7
|
%
|
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SOURCE TETRA Technologies, Inc.