Second Quarter Highlights
NCS Multistage Holdings, Inc. (NASDAQ:NCSM) (“NCS” or the
“Company”), a leading provider of highly engineered products and
support services that facilitate the optimization of oil and
natural gas well completions and field development strategies,
today announced its results for the quarter ended June 30,
2017.
Financial Review
Revenues were $36.9 million for the quarter, an
increase of $25.6 million, or 227% as compared to the second
quarter of 2016. This increase was primarily attributable to an
increase in the sale of completions products and services due to
higher customer drilling and well completion activity as a result
of an improved commodity price environment in the second quarter of
2017 as compared to the second quarter of 2016.
On a sequential basis, total revenues fell by
37% as compared to the first quarter, with a 60% sequential decline
in Canadian revenues offset by sequential revenue increases from
our U.S. and international operations. The 37% sequential revenue
decline is an improvement as compared to the 51% sequential revenue
decline during the same period in 2016, with the improvement driven
primarily by higher contributions from the less-seasonal U.S. and
international markets and the Canadian Deep Basin.
Net loss attributable to NCS was $(4.5) million,
or $(0.11) diluted loss per share for the quarter ended
June 30, 2017, which included a net expense of
$1.0 million ($0.8 million after tax, or $0.02 per diluted
share) related to the write-off of debt issuance costs, IPO-related
professional expenses, realized and unrealized foreign currency
gains and losses and the change in fair value of contingent
consideration. Adjusted net loss attributable to NCS, which
excludes these items, was $(3.7) million or $(0.09) per diluted
share. This compares to a net loss attributable to NCS of
$(8.6) million, or $(0.25) diluted loss per share in the
second quarter of 2016, which included a net expense of $0.6
million ($0.4 million after tax, or $0.01 per diluted share)
related to restructuring charges and realized and unrealized
foreign currency gains and losses. Adjusted net loss attributable
to NCS, which excludes these items, was $(8.2) million or $(0.24)
per diluted share.
Adjusted EBITDA was $4.8 million for the
quarter, an increase of $7.3 million as compared to the second
quarter of 2016. Adjusted EBITDA margin for the second quarter of
2017 was 13%, as compared to (22%) for the second quarter of
2016.
For the first half of 2017, the Company reported
revenues of $95.5 million, an increase of $61.1 million, or 178% as
compared to the first half of 2016. Net income attributable to NCS
of $2.1 million in the first half of 2017 compares to a net loss of
$(16.7) million in the first half of 2016. Adjusted EBITDA of $24.0
million for the first half of 2017 was an increase of $23.8 million
as compared to the first half of 2016.
NCS completed its initial public offering of its
common stock on May 3, 2017, thus a portion of the second quarter
of 2017 reflects a period during which the Company was
privately-owned.
Capital Expenditures and
Liquidity
The Company spent $2.2 million in capital
expenditures, net, during the second quarter of 2017. These
expenditures were made to support the growth of the business,
including certain investments to increase sliding sleeve production
capacity.
As of June 30, 2017, the Company had $80.0
million in cash, total availability under its revolving facility of
$50.0 million and $3.2 million in total debt.
NCS’s Chief Executive Officer, Robert Nipper,
commented, “I am very pleased with our performance in the second
quarter. We continue to execute on our strategy to grow our
customer base in all of our core geographies, which resulted in
record second quarter volumes for NCS across sliding sleeve and
AirLock sales as well as wells completed. With the successful
completion of our IPO, we are well-positioned to continue to bring
innovative products and services to our customers to help them
optimize completion designs and field development strategies. I’d
like to thank all of our employees for their tremendous efforts
during this exciting time for NCS.”
Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net (Loss)
Earnings per Diluted Share are non-GAAP financial measures. For an
explanation of these measures and a reconciliation, refer to
“Non-GAAP Financial Measures” below.
Conference Call
The Company will host a conference call to
discuss its second quarter 2017 results on Wednesday, August 9,
2017 at 7:30 a.m. Central Time (8:30 a.m. Eastern Time). To
join the conference call from within the United States,
participants may dial (844) 400-1696. To join the conference call
from outside of the United States, participants may dial (703)
736-7385. The conference access code is 58076646. Participants are
encouraged to log in to the webcast or dial in to the conference
call approximately ten minutes prior to the start time. To listen
via live webcast, please visit the Investors section of the
Company’s website, http://www.ncsmultistage.com.
An audio replay of the conference call will be
available shortly after the conclusion of the call and will remain
available for approximately seven days. It can be accessed by
dialing (855) 859-2056 within the United States or (404) 537-3406
outside of the United States. The conference call replay access
code is 58076646. The replay will also be available in the
Investors section of the Company’s website shortly after the
conclusion of the call and will remain available for approximately
seven days.
About NCS Multistage Holdings, Inc.
NCS Multistage Holdings, Inc. is a leading provider of highly
engineered products and support services that facilitate the
optimization of oil and natural gas well completions and field
development strategies. The Company provides products and services
to exploration and production companies for use in horizontal wells
in unconventional oil and natural gas formations throughout North
America and in selected international markets, including Argentina,
China and Russia. The Company’s common stock is traded on the
NASDAQ Global Select Market under the symbol “NCSM.” Additional
information is available on the Company’s website,
www.ncsmultistage.com.
Forward Looking Statements
This press release contains forward-looking
statements within the meaning of the “safe harbor” provisions of
the Private Securities Litigation Reform Act of 1995. Examples of
forward-looking statements include, but are not limited to,
statements we make regarding the outlook for our future business
and financial performance. Forward-looking statements are based on
our current expectations and assumptions regarding our business,
the economy and other future conditions. Because forward-looking
statements relate to the future, by their nature, they are subject
to inherent uncertainties, risks and changes in circumstances that
are difficult to predict. As a result, our actual results may
differ materially from those contemplated by the forward-looking
statements. Factors that could cause our actual results to differ
materially from the results contemplated by such forward-looking
statements include, but are not limited to declines in the level of
oil and natural gas exploration and production activity within
Canada and the United States oil and natural gas price
fluctuations; loss of significant customers; inability to
successfully implement our strategy of increasing sales of products
and services into the United States; significant competition for
our products and services; our inability to successfully develop
and implement new technologies, products and services; our
inability to protect and maintain critical intellectual property
assets; currency exchange rate fluctuations; impact of severe
weather conditions; restrictions on the availability of our
customers to obtain water essential to the drilling and hydraulic
fracturing processes; our failure to identify and consummate
potential acquisitions; our inability to accurately predict
customer demand; losses and liabilities from uninsured or
underinsured drilling and operating activities; changes in
legislation or regulation governing the oil and natural gas
industry, including restrictions on emissions of GHGs; failure to
comply with federal, state and local and non-U.S. laws and other
regulations; loss of our information and computer systems; system
interruptions or failures, including cyber-security breaches,
identity theft or other disruptions that could compromise our
information; our failure to establish and maintain effective
internal control over financial reporting; our success in
attracting and retaining qualified employees and key personnel; our
inability to satisfy technical requirements and other
specifications under contracts and contract tenders and other
factors discussed or referenced in our filings made from time to
time with the Securities and Exchange Commission. Any
forward-looking statement made by us in this press release speaks
only as of the date on which we make it. Factors or events that
could cause our actual results to differ may emerge from time to
time, and it is not possible for us to predict all of them. We
undertake no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future developments or otherwise, except as may be required by
law.
NCS MULTISTAGE HOLDINGS,
INC.CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(In thousands, except per share
data)(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
Product sales |
|
$ |
29,397 |
|
|
$ |
8,747 |
|
|
$ |
74,971 |
|
|
$ |
25,959 |
|
Services |
|
|
7,460 |
|
|
|
2,534 |
|
|
|
20,522 |
|
|
|
8,429 |
|
Total
revenues |
|
|
36,857 |
|
|
|
11,281 |
|
|
|
95,493 |
|
|
|
34,388 |
|
Cost of
sales |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of product sales,
exclusive of depreciation and amortization expense shown
below |
|
|
15,733 |
|
|
|
4,936 |
|
|
|
40,448 |
|
|
|
14,485 |
|
Cost of services,
exclusive of depreciation and amortization expense shown
below |
|
|
3,152 |
|
|
|
1,553 |
|
|
|
7,791 |
|
|
|
4,699 |
|
Total
cost of sales, exclusive of depreciation and amortization
expense shown below |
|
|
18,885 |
|
|
|
6,489 |
|
|
|
48,239 |
|
|
|
19,184 |
|
Selling, general and
administrative expenses |
|
|
16,163 |
|
|
|
8,417 |
|
|
|
28,935 |
|
|
|
16,872 |
|
Depreciation |
|
|
678 |
|
|
|
450 |
|
|
|
1,242 |
|
|
|
902 |
|
Amortization |
|
|
5,973 |
|
|
|
6,092 |
|
|
|
11,995 |
|
|
|
11,863 |
|
Change in fair value of
contingent consideration |
|
|
767 |
|
|
|
— |
|
|
|
767 |
|
|
|
— |
|
(Loss)
income from operations |
|
|
(5,609 |
) |
|
|
(10,167 |
) |
|
|
4,315 |
|
|
|
(14,433 |
) |
Other income
(expense) |
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net |
|
|
(2,007 |
) |
|
|
(1,590 |
) |
|
|
(3,516 |
) |
|
|
(3,056 |
) |
Other income (expense),
net |
|
|
64 |
|
|
|
(37 |
) |
|
|
1,038 |
|
|
|
(11 |
) |
Foreign currency
exchange gain (loss) |
|
|
1,952 |
|
|
|
(451 |
) |
|
|
1,011 |
|
|
|
(6,329 |
) |
Total
other income (expense) |
|
|
9 |
|
|
|
(2,078 |
) |
|
|
(1,467 |
) |
|
|
(9,396 |
) |
(Loss)
income before income tax |
|
|
(5,600 |
) |
|
|
(12,245 |
) |
|
|
2,848 |
|
|
|
(23,829 |
) |
Income
tax (benefit) expense |
|
|
(855 |
) |
|
|
(3,655 |
) |
|
|
1,245 |
|
|
|
(7,113 |
) |
Net (loss) income |
|
|
(4,745 |
) |
|
|
(8,590 |
) |
|
|
1,603 |
|
|
|
(16,716 |
) |
Net loss attributable
to non-controlling interest |
|
|
254 |
|
|
|
— |
|
|
|
456 |
|
|
|
— |
|
Net (loss)
income attributable to NCS Multistage Holdings,
Inc. |
|
$ |
(4,491 |
) |
|
$ |
(8,590 |
) |
|
$ |
2,059 |
|
|
$ |
(16,716 |
) |
(Loss) earnings
per common share |
|
|
|
|
|
|
|
|
|
|
|
|
Basic
(loss) earnings per common share attributable to NCS
Multistage Holdings, Inc. |
|
$ |
(0.11 |
) |
|
$ |
(0.25 |
) |
|
$ |
0.05 |
|
|
$ |
(0.49 |
) |
Diluted
(loss) earnings per common share attributable to NCS
Multistage Holdings, Inc. |
|
$ |
(0.11 |
) |
|
$ |
(0.25 |
) |
|
$ |
0.05 |
|
|
$ |
(0.49 |
) |
Weighted
average common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
40,198 |
|
|
|
34,001 |
|
|
|
37,119 |
|
|
|
34,010 |
|
Diluted |
|
|
40,198 |
|
|
|
34,001 |
|
|
|
40,188 |
|
|
|
34,010 |
|
|
NCS MULTISTAGE HOLDINGS,
INC.CONDENSED CONSOLIDATED BALANCE
SHEETS(In thousands, except share data)
(Unaudited) |
|
|
|
|
|
|
|
|
|
June 30, |
|
December 31, |
|
|
2017 |
|
|
2016 |
|
Assets |
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
79,991 |
|
|
$ |
18,275 |
|
Accounts
receivable—trade, net |
|
|
36,656 |
|
|
|
32,116 |
|
Inventories |
|
|
22,382 |
|
|
|
17,017 |
|
Prepaid
expenses and other current assets |
|
|
1,561 |
|
|
|
2,445 |
|
Other
current receivables |
|
|
1,284 |
|
|
|
3,053 |
|
Deferred
income taxes, net |
|
|
— |
|
|
|
2,116 |
|
Total
current assets |
|
|
141,874 |
|
|
|
75,022 |
|
Noncurrent assets |
|
|
|
|
|
|
Property
and equipment, net |
|
|
18,307 |
|
|
|
9,759 |
|
Goodwill |
|
|
141,439 |
|
|
|
122,077 |
|
Identifiable intangibles, net |
|
|
113,910 |
|
|
|
118,697 |
|
Deposits
and other assets |
|
|
1,491 |
|
|
|
1,272 |
|
Total
noncurrent assets |
|
|
275,147 |
|
|
|
251,805 |
|
Total
assets |
|
$ |
417,021 |
|
|
$ |
326,827 |
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
Accounts
payable—trade |
|
$ |
10,623 |
|
|
$ |
10,258 |
|
Accrued
expenses |
|
|
4,749 |
|
|
|
3,290 |
|
Income
taxes payable |
|
|
4,763 |
|
|
|
— |
|
Other
current liabilities |
|
|
1,975 |
|
|
|
3,223 |
|
Current
maturities of long-term debt |
|
|
2,059 |
|
|
|
772 |
|
Total
current liabilities |
|
|
24,169 |
|
|
|
17,543 |
|
Noncurrent
liabilities |
|
|
|
|
|
|
Long-term
debt, less current maturities |
|
|
1,133 |
|
|
|
88,394 |
|
Other
long-term liabilities |
|
|
8,493 |
|
|
|
717 |
|
Deferred
income taxes, net |
|
|
32,825 |
|
|
|
42,695 |
|
Total
noncurrent liabilities |
|
|
42,451 |
|
|
|
131,806 |
|
Total
liabilities |
|
|
66,620 |
|
|
|
149,349 |
|
Commitments and
contingencies |
|
|
|
|
|
|
Stockholders’
equity |
|
|
|
|
|
|
Preferred
stock, $0.01 par value, 1 share authorized, issued, and outstanding
at |
|
|
— |
|
|
|
— |
|
June 30, 2017 and December 31, 2016, respectively |
|
|
|
|
|
|
Common
stock, $0.01 par value, 225,000,000 shares authorized, 43,574,326
shares issued |
|
|
|
|
|
|
and
43,555,978 shares outstanding at June 30, 2017 and 54,000,000
shares authorized, |
|
|
|
|
|
|
34,024,326 shares issued and 34,005,978 shares outstanding at
December 31, 2016 |
|
|
436 |
|
|
|
340 |
|
Additional paid-in capital |
|
|
388,243 |
|
|
|
237,566 |
|
Accumulated other comprehensive loss |
|
|
(74,422 |
) |
|
|
(82,015 |
) |
Retained
earnings |
|
|
23,821 |
|
|
|
21,762 |
|
Treasury
stock, at cost; 18,348 shares at June 30, 2017 and at December
31, 2016 |
|
|
(175 |
) |
|
|
(175 |
) |
Total
stockholders’ equity |
|
|
337,903 |
|
|
|
177,478 |
|
Non-controlling interest |
|
|
12,498 |
|
|
|
— |
|
Total
equity |
|
|
350,401 |
|
|
|
177,478 |
|
Total
liabilities and stockholders' equity |
|
$ |
417,021 |
|
|
$ |
326,827 |
|
NCS MULTISTAGE HOLDINGS,
INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS(In
thousands)(Unaudited) |
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
|
June 30, |
|
|
2017 |
|
|
2016 |
|
Cash flows from
operating activities |
|
|
|
Net income (loss) |
|
$ |
1,603 |
|
|
$ |
(16,716 |
) |
Adjustments to
reconcile net income (loss) to net cash provided by operating
activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
13,237 |
|
|
|
12,765 |
|
Amortization of deferred loan cost |
|
|
289 |
|
|
|
366 |
|
Share-based compensation |
|
|
1,836 |
|
|
|
670 |
|
Deferred
income tax benefit |
|
|
(8,577 |
) |
|
|
(5,148 |
) |
(Gain)
loss on sale of property and equipment |
|
|
(44 |
) |
|
|
4 |
|
Foreign
exchange (gain) loss on financing item |
|
|
(1,780 |
) |
|
|
6,141 |
|
Write-off
of deferred loan costs |
|
|
1,422 |
|
|
|
— |
|
Change in
fair value of contingent consideration |
|
|
767 |
|
|
|
— |
|
Changes in operating
assets and liabilities: |
|
|
|
|
|
|
Accounts
receivable—trade |
|
|
(3,598 |
) |
|
|
15,530 |
|
Inventories |
|
|
(4,866 |
) |
|
|
2,003 |
|
Prepaid
expenses and other assets |
|
|
(601 |
) |
|
|
(233 |
) |
Accounts
payable—trade |
|
|
60 |
|
|
|
(2,615 |
) |
Accrued
expenses |
|
|
1,407 |
|
|
|
(144 |
) |
Other
liabilities |
|
|
(679 |
) |
|
|
38 |
|
Income
taxes receivable/payable |
|
|
6,564 |
|
|
|
(1,775 |
) |
Net cash
provided by operating activities |
|
|
7,040 |
|
|
|
10,886 |
|
Cash flows from
investing activities |
|
|
|
|
|
|
Purchases of property
and equipment |
|
|
(3,873 |
) |
|
|
(301 |
) |
Proceeds from sales of
property and equipment |
|
|
137 |
|
|
|
215 |
|
Proceeds from
short-term note receivable |
|
|
1,000 |
|
|
|
— |
|
Acquisition of
business, net of cash acquired |
|
|
(5,996 |
) |
|
|
— |
|
Net cash
used in investing activities |
|
|
(8,732 |
) |
|
|
(86 |
) |
Cash flows from
financing activities |
|
|
|
|
|
|
Equipment note
borrowings |
|
|
1,533 |
|
|
|
— |
|
Payments on equipment
note |
|
|
(80 |
) |
|
|
— |
|
Promissory note
borrowings |
|
|
2,955 |
|
|
|
— |
|
Payments on promissory
note |
|
|
(1,216 |
) |
|
|
— |
|
Payment of deferred
loan cost related to new credit agreement |
|
|
(683 |
) |
|
|
— |
|
Payments related to
public offering |
|
|
(2,178 |
) |
|
|
— |
|
Proceeds from related
party note receivable |
|
|
752 |
|
|
|
— |
|
Repayment of term
note |
|
|
(89,077 |
) |
|
|
— |
|
Purchases of treasury
stock |
|
|
— |
|
|
|
(175 |
) |
Proceeds from issuance
of common stock, net of offering costs |
|
|
151,356 |
|
|
|
50 |
|
Net cash
provided by (used in) financing activities |
|
|
63,362 |
|
|
|
(125 |
) |
Effect of exchange rate
changes on cash and cash equivalents |
|
|
46 |
|
|
|
675 |
|
Net
change in cash and cash equivalents |
|
|
61,716 |
|
|
|
11,350 |
|
Cash and cash
equivalents beginning of period |
|
|
18,275 |
|
|
|
9,545 |
|
Cash and cash
equivalents end of period |
|
$ |
79,991 |
|
|
$ |
20,895 |
|
NCS MULTISTAGE HOLDINGS,
INC.RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL
INFORMATION (In thousands, except per share
data) (Unaudited)
Non-GAAP Financial Measures
EBITDA is defined as net income (loss) before
interest expense, net, income tax expense (benefit) and
depreciation and amortization. Adjusted EBITDA is defined as EBITDA
adjusted to exclude certain items which we believe are not
reflective of ongoing performance or which, in the case of
share-based compensation, are non-cash in nature. Adjusted EBITDA
margin represents Adjusted EBITDA as a percentage of total
revenues. Adjusted Net (Loss) Earnings per Diluted Share is defined
as net income (loss) attributable to NCS Multistage Holdings, Inc.
adjusted to exclude certain items which we believe are not
reflective of ongoing performance. We believe that Adjusted EBITDA
and Adjusted Net (Loss) Earnings per Diluted Share are important
measures that exclude costs that management believes do not reflect
our ongoing operating performance and, in the case of Adjusted
EBITDA, certain costs associated with our capital structure.
Accordingly, Adjusted EBITDA and Adjusted EBITDA margin are key
metrics that management uses to assess the period-to-period
performance of our core business operations. We believe that
presenting Adjusted EBITDA and Adjusted EBITDA margin enables
investors to assess our performance from period to period using the
same metrics utilized by management and that Adjusted EBITDA,
Adjusted EBITDA margin and Adjusted Net (Loss) per Diluted Share
enable investors to evaluate our performance relative to other
companies that are not subject to such factors.
EBITDA, Adjusted EBITDA, Adjusted EBITDA margin
and Adjusted Net (Loss) Earnings per Diluted Share (our “non-GAAP
financial measures”) are not defined under generally accepted
accounting principles (“GAAP”), are not measures of net income,
income from operations or any other performance measure derived in
accordance with GAAP, and are subject to important limitations. Our
non-GAAP financial measures may not be comparable to similarly
titled measures of other companies in our industry and are not
measures of performance calculated in accordance with GAAP. Our
non-GAAP financial measures have important limitations as
analytical tools and you should not consider them in isolation or
as substitutes for analysis of our financial performance as
reported under GAAP and they should not be considered as
alternatives to net income (loss) or any other performance measures
derived in accordance with GAAP as measures of operating
performance or as alternatives to cash flow from operating
activities as measures of our liquidity.
The tables below set forth reconciliations of
our non-GAAP financial measures to the most directly comparable
measure of financial performance calculated under GAAP:
ADJUSTED NET (LOSS) EARNINGS PER DILUTED
SHARE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, 2017 |
|
June 30, 2016 |
|
June 30, 2017 |
|
June 30, 2016 |
|
|
Effect on Net Loss (After- Tax) |
|
Impact on Diluted Earnings Per
Share |
|
Effect on Net Loss (After- Tax) |
|
Impact on Diluted Earnings Per
Share |
|
Effect on Net Income (After- Tax) |
|
Impact on Diluted Earnings Per
Share |
|
Effect on Net Loss (After- Tax) |
|
Impact on Diluted Earnings Per
Share |
Net (loss) income
attributable to NCS Multistage Holdings, Inc. |
|
$ |
(4,491 |
) |
|
$ |
(0.11 |
) |
|
$ |
(8,590 |
) |
|
$ |
(0.25 |
) |
|
$ |
2,059 |
|
|
$ |
0.05 |
|
|
$ |
(16,716 |
) |
|
$ |
(0.49 |
) |
Adjustments (after
tax) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Write-off
of debt issuance costs (a) |
|
|
1,076 |
|
|
|
0.03 |
|
|
|
— |
|
|
|
— |
|
|
|
1,070 |
|
|
|
0.03 |
|
|
|
— |
|
|
|
— |
|
Restructuring charges (b) |
|
|
— |
|
|
|
— |
|
|
|
103 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
176 |
|
|
|
— |
|
IPO-related professional expense (c) |
|
|
580 |
|
|
|
0.01 |
|
|
|
— |
|
|
|
— |
|
|
|
1,692 |
|
|
|
0.04 |
|
|
|
— |
|
|
|
— |
|
Realized
and unrealized (gains) losses (d) |
|
|
(1,480 |
) |
|
|
(0.03 |
) |
|
|
316 |
|
|
|
0.01 |
|
|
|
(826 |
) |
|
|
(0.02 |
) |
|
|
4,441 |
|
|
|
0.13 |
|
Change in
fair value of contingent consideration (e) |
|
|
580 |
|
|
|
0.01 |
|
|
|
— |
|
|
|
— |
|
|
|
577 |
|
|
|
0.01 |
|
|
|
— |
|
|
|
— |
|
Adjusted net
(loss) income attributable to NCS Multistage
Holdings, Inc. |
|
$ |
(3,735 |
) |
|
$ |
(0.09 |
) |
|
$ |
(8,171 |
) |
|
$ |
(0.24 |
) |
|
$ |
4,572 |
|
|
$ |
0.11 |
|
|
$ |
(12,099 |
) |
|
$ |
(0.36 |
) |
_____________________
(a) Includes the remaining debt issuance costs of $1,422 related
to the prior credit agreement that were expensed when the debt was
repaid with a portion of our net proceeds from the initial public
offering of shares of our common stock (“IPO”) during the three
months ended June 30, 2017.
(b)Represents severance and other expenses associated with
headcount reductions and other cost savings initiated as part of
our restructuring initiatives.
(c) Represents costs of professional services incurred in
connection with our IPO.
(d) Represents realized and unrealized foreign currency
translation gains and losses primarily in respect of our
indebtedness.
(e) Represents the change in the fair value of the earn-out
associated with the Repeat Precision, LLC acquisition.
NCS MULTISTAGE HOLDINGS,
INC.RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL
INFORMATION (In thousands)
(Unaudited)ADJUSTED EBITDA AND ADJUSTED
EBITDA MARGIN |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
|
Net (loss) income |
|
$ |
(4,745 |
) |
|
$ |
(8,590 |
) |
|
$ |
1,603 |
|
|
$ |
(16,716 |
) |
Income tax (benefit)
expense |
|
|
(855 |
) |
|
|
(3,655 |
) |
|
|
1,245 |
|
|
|
(7,113 |
) |
Interest expense, net
(a) |
|
|
2,007 |
|
|
|
1,590 |
|
|
|
3,516 |
|
|
|
3,056 |
|
Depreciation |
|
|
678 |
|
|
|
450 |
|
|
|
1,242 |
|
|
|
902 |
|
Amortization |
|
|
5,973 |
|
|
|
6,092 |
|
|
|
11,995 |
|
|
|
11,863 |
|
EBITDA |
|
|
3,058 |
|
|
|
(4,113 |
) |
|
|
19,601 |
|
|
|
(8,008 |
) |
Share-based
compensation (b) |
|
|
1,499 |
|
|
|
339 |
|
|
|
1,836 |
|
|
|
670 |
|
Restructuring charges
(c) |
|
|
— |
|
|
|
148 |
|
|
|
— |
|
|
|
251 |
|
Professional fees
(d) |
|
|
1,155 |
|
|
|
184 |
|
|
|
2,946 |
|
|
|
260 |
|
Unrealized foreign
currency loss (e) |
|
|
19,361 |
|
|
|
729 |
|
|
|
19,440 |
|
|
|
6,633 |
|
Realized foreign
currency gain (f) |
|
|
(21,313 |
) |
|
|
(278 |
) |
|
|
(20,451 |
) |
|
|
(304 |
) |
Change in fair value of
contingent consideration (g) |
|
|
767 |
|
|
|
— |
|
|
|
767 |
|
|
|
— |
|
Other (h) |
|
|
246 |
|
|
|
501 |
|
|
|
(136 |
) |
|
|
698 |
|
Adjusted EBITDA |
|
$ |
4,773 |
|
|
$ |
(2,490 |
) |
|
$ |
24,003 |
|
|
$ |
200 |
|
Adjusted EBITDA Margin |
|
|
13 |
% |
|
|
(22 |
%) |
|
|
25 |
% |
|
|
1 |
% |
_____________________
(a) Includes the remaining debt issuance costs of $1,422 related
to the prior credit agreement that were expensed when the debt was
repaid with a portion of our net proceeds from the IPO during the
three months ended June 30, 2017.
(b) Represents non-cash compensation charges related to
share-based compensation granted to our officers, employees and
directors.
(c) Represents severance and other expenses associated with
headcount reductions and other cost savings initiated as part of
our restructuring initiatives.
(d) Represents costs of professional services incurred in
connection with our IPO, refinancings and the evaluation of
proposed acquisitions.
(e) Represents unrealized foreign currency translation gains and
losses primarily in respect of our indebtedness.
(f) Represents realized foreign currency translation gains and
losses with respect to principal and interest payments related to
our indebtedness.
(g) Represents the change in the fair value of the earn-out
associated with the Repeat Precision, LLC acquisition.
(h) Represents the impact of a research and development subsidy
that is included in income tax expense (benefit) in accordance with
GAAP, fees incurred in connection with refinancing our credit
facilities, arbitration awards, board of directors fees and travel
expenses prior to our initial public offering as permitted by the
terms of our prior credit agreement and other charges and credits.
The board of directors fees and travel expenses were previously
reported on a separate line item, however with the repayment of our
prior credit facility, we will not be including such fees and
travel expenses incurred in periods following our IPO when
calculating Adjusted EBITDA.
NCS MULTISTAGE HOLDINGS,
INC.REVENUE BY GEOGRAPHIC AREA(In
thousands)(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
United States |
|
|
|
|
|
|
|
|
|
|
|
|
Product
Sales |
|
$ |
12,815 |
|
$ |
2,319 |
|
$ |
25,128 |
|
$ |
5,250 |
Services |
|
|
2,588 |
|
|
1,052 |
|
|
5,350 |
|
|
2,235 |
Total
United States |
|
|
15,403 |
|
|
3,371 |
|
|
30,478 |
|
|
7,485 |
Canada |
|
|
|
|
|
|
|
|
|
|
|
|
Product
Sales |
|
|
12,422 |
|
|
5,943 |
|
|
44,612 |
|
|
19,982 |
Services |
|
|
4,059 |
|
|
1,174 |
|
|
13,541 |
|
|
5,467 |
Total
Canada |
|
|
16,481 |
|
|
7,117 |
|
|
58,153 |
|
|
25,449 |
Other Countries |
|
|
|
|
|
|
|
|
|
|
|
|
Product
Sales |
|
|
4,160 |
|
|
485 |
|
|
5,231 |
|
|
727 |
Services |
|
|
813 |
|
|
308 |
|
|
1,631 |
|
|
727 |
Total
Other Countries |
|
|
4,973 |
|
|
793 |
|
|
6,862 |
|
|
1,454 |
Total |
|
|
|
|
|
|
|
|
|
|
|
|
Product
Sales |
|
|
29,397 |
|
|
8,747 |
|
|
74,971 |
|
|
25,959 |
Services |
|
|
7,460 |
|
|
2,534 |
|
|
20,522 |
|
|
8,429 |
Total |
|
$ |
36,857 |
|
$ |
11,281 |
|
$ |
95,493 |
|
$ |
34,388 |
Contacts
Ryan Hummer
Chief Financial Officer
(281) 453-2222
IR@ncsmultistage.com
NCS Multistage (NASDAQ:NCSM)
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