Third Quarter Highlights
NCS Multistage Holdings, Inc. (NASDAQ: NCSM) (the “Company,” “NCS,”
“we” or “us”), 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
September 30, 2018.
Financial Review
Revenues were $62.7 million for the quarter ended
September 30, 2018, an increase of $6.7 million or 12% as
compared to the third quarter of 2017. This increase was primarily
attributable to an increase in product sales and services revenue
in the U.S. and international markets, including tracer diagnostics
services, which we added in 2017 through the acquisition of
Spectrum Tracer Services, LLC (“Spectrum”). These increases were
offset by lower volumes of fracturing systems product sales and
services in Canada, where customer activity was negatively impacted
by weather conditions and increasing commodity price differentials
during the quarter, and where we are facing increased pricing
pressure. Total revenues increased by 44%
as compared to the second quarter of 2018 with an
increase of 110% in Canada and an increase of 297% in other
international countries partially offset by a decrease of 5% in the
U.S.
Net income was $6.3 million, or $0.13 per diluted share for the
quarter ended September 30, 2018, which included a net benefit
of $1.2 million ($0.9 million after tax, or $0.02 per diluted
share) related to the change in fair value of contingent
consideration and realized and unrealized foreign currency gains
and losses. Adjusted net income, which excludes these items, was
$5.4 million, or $0.11 per diluted share, for the quarter ended
September 30, 2018. This compares to a net income of
$3.4 million, or $0.07 per diluted share in the third quarter
of 2017, which included a net expense of $1.0 million ($0.8 million
after tax, or $0.02 per diluted share) related to professional
expenses incurred in connection with the initial public offering of
our common stock (“IPO”) and acquisitions, change in fair value of
contingent consideration and realized and unrealized foreign
currency gains and losses. Adjusted net income, which excludes
these items, was $4.2 million or $0.09 per diluted share, for the
quarter ended September 30, 2017.
Adjusted EBITDA was $18.0 million for the quarter ended
September 30, 2018, an increase of $2.9 million as compared to
the third quarter of 2017. Gross profit, which we define as total
revenues less total cost of sales exclusive of depreciation and
amortization, increased to $33.9 million, or 54% of total revenues
in the third quarter of 2018, as compared to $30.0 million, or 54%
of total revenues, in the third quarter of 2017. This was offset by
an increase in selling, general and administrative expenses in the
third quarter as compared to the prior year, primarily related to
increases in personnel to support growth and the inclusion of
tracer diagnostics operations resulting from our Spectrum
acquisition. Adjusted EBITDA margin for the quarter was 29%, as
compared to 27% for the third quarter of 2017.
Based on current industry conditions and the Company’s revenue
through the first three quarters of 2018, NCS no longer expects to
achieve the revenue guidance previously announced in August for the
2018 calendar year.
Capital Expenditures and Liquidity
The Company spent $6.1 million in capital expenditures, net for
the third quarter of 2018 and $9.6 million, net, for the nine
months ended September 30, 2018.
As of September 30, 2018, the Company had $27.4 million in
cash, total availability under its revolving credit facility of
$55.0 million and $25.6 million in total debt.
Review and Outlook
NCS’s Chief Executive Officer, Robert Nipper, commented, “I’m
very proud of our team and how we are responding to dynamic market
conditions. While our business was negatively impacted in the third
quarter by a slowdown in completions activity in the U.S. and by a
challenging operating environment in Canada, we grew our business
on a year-over-year basis and had significant achievements in each
of our geographical operating areas, including:
- The fourth consecutive quarter in which U.S. product sales
increased sequentially by 10% or more;
- The completion of a 227-stage well for a customer operating in
the Montney in Canada in which over 18 million pounds of proppant
was efficiently placed into the formation in a single run;
- The first sales of our Purple Seal Express frac-plug deployment
system, a pre-assembled system combining a disposable setting tool
with our Purple Seal frac plug, to multiple operators in the
Permian Basin;
- Our first tracer diagnostics jobs outside of North America;
and
- The delivery of sliding sleeves under our recently-announced
Frame Agreement with Aker BP, to be utilized in the completion of
several additional wells in the North Sea, and the completion of a
well for a second customer in the North Sea.
We look to continue to build on these accomplishments over the
coming quarters as we navigate a challenging industry environment
in the U.S. and Canada. In both the United States and Canada, we
currently anticipate that industry completions activity will
decline in the fourth quarter as a result of seasonal holidays,
customer budget exhaustion and customer response to elevated
differentials. We believe that the pricing differentials in the
United States will moderate in 2019 as pipeline capacity is
commissioned, which could lead to higher completions activity as
the year progresses. We believe elevated pricing differentials in
Canada are likely to persist into 2019 and potentially beyond,
which we expect to result in reduced customer activity levels and
to result in continued customer and competitor-driven pricing
pressure for our products and services, negatively impacting our
margins. We believe that the increased breadth of our product and
service portfolio positions us to benefit from the potential
recovery in completions activity in the United States and that our
growing international presence provides us with additional
long-term growth opportunities.”
Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income and
Adjusted Net 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 third
quarter 2018 results on Wednesday, November 7, 2018 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 7987038. 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 7987038.
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. NCS 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, Russia, and the North Sea. NCS’s common stock is traded on
the NASDAQ Global Select Market under the symbol “NCSM.” Additional
information is available on the 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. Forward-looking
statements can be identified by words such as “anticipates,”
“intends,” “plans,” “seeks,” “believes,” “estimates,” “expects” and
similar references to future periods, or by the inclusion of
forecasts or projections. 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. Important factors that could cause our actual results
to differ materially from those in the forward-looking statements
include regional, national or global political, economic, business,
competitive, market and regulatory conditions and the following:
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
integrate or realize the expected benefits from acquisitions; our
inability to meet regulatory requirements for use of certain
chemicals by our tracer diagnostics business; 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 greenhouse
gases; failure to comply with or changes to federal, state and
local and non-U.S. laws and other regulations, including
environmental regulations and the U.S. Tax Cuts and Jobs Act of
2017; changes in trade policy, including the impact of additional
tariffs; 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; complications with the
design and implementation of our new enterprise resource planning
system; 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.
Contact
Ryan HummerChief Financial Officer(281)
453-2222IR@ncsmultistage.com
NCS MULTISTAGE HOLDINGS,
INC.CONDENSED CONSOLIDATED STATEMENTS OF
INCOME(In thousands, except per share
data)(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Nine Months
Ended |
|
|
September 30, |
|
September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
Product sales |
|
$ |
44,633 |
|
|
$ |
39,391 |
|
|
$ |
122,514 |
|
|
$ |
114,362 |
|
Services |
|
|
18,058 |
|
|
|
16,566 |
|
|
|
54,261 |
|
|
|
37,088 |
|
Total revenues |
|
|
62,691 |
|
|
|
55,957 |
|
|
|
176,775 |
|
|
|
151,450 |
|
Cost of sales |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of product sales, exclusive of depreciation and
amortization expense shown below |
|
|
20,275 |
|
|
|
19,326 |
|
|
|
57,600 |
|
|
|
59,774 |
|
Cost of services, exclusive of depreciation and amortization
expense shown below |
|
|
8,542 |
|
|
|
6,632 |
|
|
|
24,721 |
|
|
|
14,423 |
|
Total cost of sales, exclusive of depreciation
and amortization expense shown below |
|
|
28,817 |
|
|
|
25,958 |
|
|
|
82,321 |
|
|
|
74,197 |
|
Selling, general and administrative expenses |
|
|
19,356 |
|
|
|
17,637 |
|
|
|
62,508 |
|
|
|
46,572 |
|
Depreciation |
|
|
1,174 |
|
|
|
812 |
|
|
|
3,429 |
|
|
|
2,054 |
|
Amortization |
|
|
3,255 |
|
|
|
6,486 |
|
|
|
9,859 |
|
|
|
18,481 |
|
Change in fair value of contingent consideration |
|
|
(1,865 |
) |
|
|
(182 |
) |
|
|
(3,005 |
) |
|
|
585 |
|
Income from operations |
|
|
11,954 |
|
|
|
5,246 |
|
|
|
21,663 |
|
|
|
9,561 |
|
Other income (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
|
(317 |
) |
|
|
(235 |
) |
|
|
(1,382 |
) |
|
|
(3,751 |
) |
Other income, net |
|
|
28 |
|
|
|
94 |
|
|
|
68 |
|
|
|
1,132 |
|
Foreign currency exchange (loss) gain |
|
|
(688 |
) |
|
|
(787 |
) |
|
|
(399 |
) |
|
|
224 |
|
Total other expense |
|
|
(977 |
) |
|
|
(928 |
) |
|
|
(1,713 |
) |
|
|
(2,395 |
) |
Income before income tax |
|
|
10,977 |
|
|
|
4,318 |
|
|
|
19,950 |
|
|
|
7,166 |
|
Income tax expense |
|
|
3,211 |
|
|
|
777 |
|
|
|
3,137 |
|
|
|
2,022 |
|
Net income |
|
|
7,766 |
|
|
|
3,541 |
|
|
|
16,813 |
|
|
|
5,144 |
|
Net income (loss) attributable to non-controlling interest |
|
|
1,443 |
|
|
|
155 |
|
|
|
3,565 |
|
|
|
(301 |
) |
Net income attributable to NCS Multistage Holdings,
Inc. |
|
$ |
6,323 |
|
|
$ |
3,386 |
|
|
$ |
13,248 |
|
|
$ |
5,445 |
|
Earnings per common share |
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per common share attributable to
NCS Multistage Holdings, Inc. |
|
$ |
0.14 |
|
|
$ |
0.07 |
|
|
$ |
0.29 |
|
|
$ |
0.13 |
|
Diluted earnings per common share attributable to
NCS Multistage Holdings, Inc. |
|
$ |
0.13 |
|
|
$ |
0.07 |
|
|
$ |
0.28 |
|
|
$ |
0.13 |
|
Weighted average common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
44,943 |
|
|
|
43,676 |
|
|
|
44,660 |
|
|
|
39,329 |
|
Diluted |
|
|
47,404 |
|
|
|
47,119 |
|
|
|
47,254 |
|
|
|
42,537 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NCS MULTISTAGE HOLDINGS,
INC.CONDENSED CONSOLIDATED BALANCE
SHEETS(In thousands, except share
data)(Unaudited)
|
|
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
|
2018 |
|
|
2017 |
|
Assets |
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
27,440 |
|
|
$ |
33,809 |
|
Accounts receivable—trade, net |
|
|
58,002 |
|
|
|
47,880 |
|
Inventories |
|
|
32,493 |
|
|
|
33,135 |
|
Prepaid expenses and other current assets |
|
|
3,759 |
|
|
|
1,616 |
|
Other current receivables |
|
|
4,827 |
|
|
|
1,369 |
|
Total current assets |
|
|
126,521 |
|
|
|
117,809 |
|
Noncurrent assets |
|
|
|
|
|
|
Property and equipment, net |
|
|
29,509 |
|
|
|
23,651 |
|
Goodwill |
|
|
181,500 |
|
|
|
184,478 |
|
Identifiable intangibles, net |
|
|
126,853 |
|
|
|
136,412 |
|
Deposits and other assets |
|
|
1,393 |
|
|
|
1,563 |
|
Total noncurrent assets |
|
|
339,255 |
|
|
|
346,104 |
|
Total assets |
|
$ |
465,776 |
|
|
$ |
463,913 |
|
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
Accounts payable—trade |
|
$ |
12,921 |
|
|
$ |
7,448 |
|
Accrued expenses |
|
|
4,225 |
|
|
|
6,673 |
|
Income taxes payable |
|
|
119 |
|
|
|
10,561 |
|
Current contingent consideration |
|
|
9,830 |
|
|
|
— |
|
Other current liabilities |
|
|
2,921 |
|
|
|
1,673 |
|
Current maturities of long-term debt |
|
|
2,530 |
|
|
|
5,334 |
|
Total current liabilities |
|
|
32,546 |
|
|
|
31,689 |
|
Noncurrent liabilities |
|
|
|
|
|
|
Long-term debt, less current maturities |
|
|
23,052 |
|
|
|
21,702 |
|
Noncurrent contingent consideration |
|
|
— |
|
|
|
12,835 |
|
Other long-term liabilities |
|
|
1,232 |
|
|
|
4,513 |
|
Deferred income taxes, net |
|
|
20,912 |
|
|
|
24,183 |
|
Total noncurrent liabilities |
|
|
45,196 |
|
|
|
63,233 |
|
Total liabilities |
|
|
77,742 |
|
|
|
94,922 |
|
Commitments and contingencies |
|
|
|
|
|
|
Stockholders’ equity |
|
|
|
|
|
|
Preferred stock, $0.01 par value, 10,000,000 shares
authorized, one share issued and outstanding at |
|
|
|
|
|
|
September 30, 2018 and December 31, 2017,
respectively |
|
|
— |
|
|
|
— |
|
Common stock, $0.01 par value, 225,000,000 shares
authorized, 45,038,934 shares issued |
|
|
|
|
|
|
and 45,010,626 shares outstanding at
September 30, 2018 and 43,931,484 shares issued |
|
|
|
|
|
|
and 43,913,136 shares outstanding at December 31,
2017 |
|
|
450 |
|
|
|
439 |
|
Additional paid-in capital |
|
|
408,613 |
|
|
|
399,426 |
|
Accumulated other comprehensive loss |
|
|
(73,260 |
) |
|
|
(66,707 |
) |
Retained earnings |
|
|
37,359 |
|
|
|
23,864 |
|
Treasury stock, at cost; 28,308 shares at
September 30, 2018 and 18,348 shares |
|
|
|
|
|
|
at December 31, 2017 |
|
|
(337 |
) |
|
|
(175 |
) |
Total stockholders’ equity |
|
|
372,825 |
|
|
|
356,847 |
|
Non-controlling interest |
|
|
15,209 |
|
|
|
12,144 |
|
Total equity |
|
|
388,034 |
|
|
|
368,991 |
|
Total liabilities and stockholders' equity |
|
$ |
465,776 |
|
|
$ |
463,913 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NCS MULTISTAGE HOLDINGS,
INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS(In
thousands)(Unaudited)
|
|
|
|
|
|
|
|
|
Nine Months
Ended |
|
|
September 30, |
|
|
2018 |
|
|
2017 |
|
Cash flows from operating activities |
|
|
|
Net income |
|
$ |
16,813 |
|
|
$ |
5,144 |
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
13,288 |
|
|
|
20,535 |
|
Amortization of deferred loan cost |
|
|
251 |
|
|
|
360 |
|
Share-based compensation |
|
|
8,197 |
|
|
|
3,889 |
|
Provision for inventory obsolescence |
|
|
1,219 |
|
|
|
— |
|
Deferred income tax benefit |
|
|
(2,148 |
) |
|
|
(12,902 |
) |
Gain on sale of property and equipment |
|
|
(39 |
) |
|
|
(40 |
) |
Foreign exchange gain on financing item |
|
|
— |
|
|
|
(1,760 |
) |
Write-off of deferred loan costs |
|
|
— |
|
|
|
1,422 |
|
Change in fair value of contingent
consideration |
|
|
(3,005 |
) |
|
|
585 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
Accounts receivable—trade |
|
|
(10,787 |
) |
|
|
(16,101 |
) |
Inventories |
|
|
(1,529 |
) |
|
|
(12,690 |
) |
Prepaid expenses and other assets |
|
|
(2,237 |
) |
|
|
(169 |
) |
Accounts payable—trade |
|
|
6,959 |
|
|
|
(983 |
) |
Accrued expenses |
|
|
(2,371 |
) |
|
|
3,531 |
|
Other liabilities |
|
|
816 |
|
|
|
129 |
|
Income taxes receivable/payable |
|
|
(17,812 |
) |
|
|
11,919 |
|
Net cash provided by operating activities |
|
|
7,615 |
|
|
|
2,869 |
|
Cash flows from investing activities |
|
|
|
|
|
|
Purchases of property and equipment |
|
|
(7,352 |
) |
|
|
(5,332 |
) |
Purchase and development of software and technology |
|
|
(2,588 |
) |
|
|
— |
|
Proceeds from sales of property and equipment |
|
|
298 |
|
|
|
181 |
|
Proceeds from short-term note receivable |
|
|
— |
|
|
|
1,000 |
|
Acquisition of business, net of cash acquired |
|
|
— |
|
|
|
(80,928 |
) |
Net cash used in investing activities |
|
|
(9,642 |
) |
|
|
(85,079 |
) |
Cash flows from financing activities |
|
|
|
|
|
|
Equipment note borrowings |
|
|
1,001 |
|
|
|
1,533 |
|
Payments on equipment note and capital leases |
|
|
(1,437 |
) |
|
|
(158 |
) |
Promissory note borrowings |
|
|
5,053 |
|
|
|
6,541 |
|
Payments on promissory note |
|
|
(8,366 |
) |
|
|
(3,661 |
) |
Line of credit borrowings |
|
|
— |
|
|
|
20,000 |
|
Payment of deferred loan cost related to senior secured credit
facility |
|
|
— |
|
|
|
(971 |
) |
Payments related to public offering |
|
|
— |
|
|
|
(2,178 |
) |
Proceeds from related party note receivable |
|
|
— |
|
|
|
752 |
|
Repayment of term note |
|
|
— |
|
|
|
(89,077 |
) |
Proceeds from issuance of common stock, net of offering costs |
|
|
— |
|
|
|
151,356 |
|
Proceeds from the exercise of options for common stock |
|
|
1,001 |
|
|
|
— |
|
Treasury shares withheld |
|
|
(161 |
) |
|
|
— |
|
Distribution to noncontrolling interest |
|
|
(500 |
) |
|
|
— |
|
Net cash (used in) provided by financing
activities |
|
|
(3,409 |
) |
|
|
84,137 |
|
Effect of exchange rate changes on cash and cash equivalents |
|
|
(933 |
) |
|
|
20 |
|
Net change in cash and cash equivalents |
|
|
(6,369 |
) |
|
|
1,947 |
|
Cash and cash equivalents beginning of period |
|
|
33,809 |
|
|
|
18,275 |
|
Cash and cash equivalents end of period |
|
$ |
27,440 |
|
|
$ |
20,222 |
|
Supplemental cash flow information |
|
|
|
|
|
|
Cash paid for income taxes (net of refunds) |
|
$ |
22,922 |
|
|
$ |
3,350 |
|
Noncash investing and financing activities |
|
|
|
|
|
|
Issuance of common stock for business acquisition |
|
$ |
— |
|
|
$ |
6,907 |
|
Assets obtained by entering into capital leases |
|
$ |
2,433 |
|
|
$ |
459 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 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 Income is defined as net income
attributable to NCS Multistage Holdings, Inc. adjusted to exclude
certain items which we believe are not reflective of ongoing
performance. Adjusted Net Earnings per Diluted Share is defined as
Adjusted Net Income divided by our diluted weighted average common
shares outstanding during the relevant period. We believe that
Adjusted EBITDA, Adjusted Net Income and Adjusted Net 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, Adjusted EBITDA margin, Adjusted Net Income and Adjusted
Net Earnings per Diluted Share are key metrics that management uses
to assess the period-to-period performance of our core business
operations. We believe that presenting Adjusted EBITDA,
Adjusted EBITDA margin, Adjusted Net Income and Adjusted Net
Earnings per Diluted Share enables investors to assess our
performance from period to period using the same metrics utilized
by management and that Adjusted EBITDA, Adjusted EBITDA margin,
Adjusted Net Income and Adjusted Net Earnings 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, Adjusted Net
Income and Adjusted Net 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 INCOME AND ADJUSTED NET
EARNINGS PER DILUTED SHARE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Nine Months
Ended |
|
|
September 30,
2018 |
|
September 30,
2017 |
|
September 30,
2018 |
|
September 30,
2017 |
|
|
Effect on Net Income
(After- Tax) |
|
Impact on Diluted Earnings
Per Share |
|
Effect on Net Income
(After- Tax) |
|
Impact on Diluted Earnings
Per Share |
|
Effect on Net Income
(After- Tax) |
|
Impact on Diluted Earnings
Per Share |
|
Effect on Net Income
(After- Tax) |
|
Impact on Diluted
Earnings Per Share |
Net income attributable to NCS Multistage Holdings, Inc. |
|
$ |
6,323 |
|
|
$ |
0.13 |
|
|
$ |
3,386 |
|
|
$ |
0.07 |
|
$ |
13,248 |
|
|
$ |
0.28 |
|
|
$ |
5,445 |
|
|
$ |
0.13 |
|
Adjustments (after tax) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Write-off of deferred loan costs (a) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
1,147 |
|
|
|
0.03 |
|
IPO-related professional expense (b) |
|
|
— |
|
|
|
— |
|
|
|
9 |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
1,822 |
|
|
|
0.04 |
|
Acquisition and merger costs (c) |
|
|
— |
|
|
|
— |
|
|
|
315 |
|
|
|
0.01 |
|
|
— |
|
|
|
— |
|
|
|
843 |
|
|
|
0.02 |
|
Realized and unrealized losses (gains) (d) |
|
|
489 |
|
|
|
0.01 |
|
|
|
652 |
|
|
|
0.01 |
|
|
270 |
|
|
|
0.01 |
|
|
|
(261 |
) |
|
|
(0.01 |
) |
Change in fair value of contingent consideration
(e) |
|
|
(1,369 |
) |
|
|
(0.03 |
) |
|
|
(154 |
) |
|
|
— |
|
|
(2,202 |
) |
|
|
(0.05 |
) |
|
|
472 |
|
|
|
0.01 |
|
Adjusted net income attributable to
NCS Multistage Holdings, Inc. |
|
$ |
5,443 |
|
|
$ |
0.11 |
|
|
$ |
4,208 |
|
|
$ |
0.09 |
|
$ |
11,316 |
|
|
$ |
0.24 |
|
|
$ |
9,468 |
|
|
$ |
0.22 |
|
_____________________
- Includes the remaining deferred loan 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
second quarter of 2017.
- Represents non-capitalizable costs of professional services
incurred in connection with our IPO.
- Represents costs of professional services incurred in
connection with our acquisition of a 50% interest in Repeat
Precision and Spectrum acquisition.
- Represents realized and unrealized foreign currency translation
gains and losses primarily in respect of our indebtedness.
- Represents the change in the fair value of the earn-outs
associated with our acquisitions
NCS MULTISTAGE HOLDINGS,
INC.RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL
INFORMATION (In thousands)
(Unaudited)
ADJUSTED EBITDA AND ADJUSTED EBITDA
MARGIN
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Nine Months
Ended |
|
|
September 30, |
|
September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
Net income |
|
$ |
7,766 |
|
|
$ |
3,541 |
|
|
$ |
16,813 |
|
|
$ |
5,144 |
|
Income tax expense |
|
|
3,211 |
|
|
|
777 |
|
|
|
3,137 |
|
|
|
2,022 |
|
Interest expense, net (a) |
|
|
317 |
|
|
|
235 |
|
|
|
1,382 |
|
|
|
3,751 |
|
Depreciation |
|
|
1,174 |
|
|
|
812 |
|
|
|
3,429 |
|
|
|
2,054 |
|
Amortization |
|
|
3,255 |
|
|
|
6,486 |
|
|
|
9,859 |
|
|
|
18,481 |
|
EBITDA |
|
|
15,723 |
|
|
|
11,851 |
|
|
|
34,620 |
|
|
|
31,452 |
|
Share-based compensation (b) |
|
|
2,865 |
|
|
|
2,053 |
|
|
|
8,197 |
|
|
|
3,889 |
|
Professional fees (c) |
|
|
486 |
|
|
|
391 |
|
|
|
1,248 |
|
|
|
3,337 |
|
Unrealized foreign currency loss (d) |
|
|
515 |
|
|
|
735 |
|
|
|
2,172 |
|
|
|
20,175 |
|
Realized foreign currency loss (gain) (e) |
|
|
173 |
|
|
|
52 |
|
|
|
(1,773 |
) |
|
|
(20,399 |
) |
Change in fair value of contingent consideration (f) |
|
|
(1,865 |
) |
|
|
(182 |
) |
|
|
(3,005 |
) |
|
|
585 |
|
Other (g) |
|
|
98 |
|
|
|
202 |
|
|
|
528 |
|
|
|
66 |
|
Adjusted EBITDA |
|
$ |
17,995 |
|
|
$ |
15,102 |
|
|
$ |
41,987 |
|
|
$ |
39,105 |
|
Adjusted EBITDA Margin |
|
|
29 |
% |
|
|
27 |
% |
|
|
24 |
% |
|
|
26 |
% |
_____________________
- Includes the remaining deferred loan 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
second quarter of 2017.
- Represents non-cash compensation charges related to share-based
compensation granted to our officers, employees and directors.
- Represents non-capitalizable costs of professional services
incurred in connection with our IPO, financings, refinancings,
legal proceedings and the evaluation of proposed and completed
acquisitions.
- Represents unrealized foreign currency translation gains and
losses primarily in respect of our indebtedness.
- Represents realized foreign currency translation gains and
losses with respect to principal and interest payments related to
our indebtedness.
- Represents the change in the fair value of the earn-outs
associated with our acquisitions.
- Represents the impact of a research and development subsidy
that is included in income tax (benefit) expense 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 IPO as permitted by the terms of our prior
credit agreement and other charges and credits.
NCS MULTISTAGE HOLDINGS,
INC.REVENUE BY GEOGRAPHIC AREA(In
thousands) (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Nine Months
Ended |
|
|
September 30, |
|
September 30, |
|
|
2018 |
|
2017 |
|
2018 |
|
2017 |
United States |
|
|
|
|
|
|
|
|
|
|
|
|
Product sales |
|
$ |
18,125 |
|
$ |
7,608 |
|
$ |
48,011 |
|
$ |
32,736 |
Services |
|
|
8,157 |
|
|
5,693 |
|
|
27,976 |
|
|
11,043 |
Total United States |
|
|
26,282 |
|
|
13,301 |
|
|
75,987 |
|
|
43,779 |
Canada |
|
|
|
|
|
|
|
|
|
|
|
|
Product sales |
|
|
21,215 |
|
|
30,342 |
|
|
67,653 |
|
|
74,954 |
Services |
|
|
7,958 |
|
|
10,031 |
|
|
22,567 |
|
|
23,572 |
Total Canada |
|
|
29,173 |
|
|
40,373 |
|
|
90,220 |
|
|
98,526 |
Other Countries |
|
|
|
|
|
|
|
|
|
|
|
|
Product sales |
|
|
5,293 |
|
|
1,441 |
|
|
6,850 |
|
|
6,672 |
Services |
|
|
1,943 |
|
|
842 |
|
|
3,718 |
|
|
2,473 |
Total Other Countries |
|
|
7,236 |
|
|
2,283 |
|
|
10,568 |
|
|
9,145 |
Total |
|
|
|
|
|
|
|
|
|
|
|
|
Product sales |
|
|
44,633 |
|
|
39,391 |
|
|
122,514 |
|
|
114,362 |
Services |
|
|
18,058 |
|
|
16,566 |
|
|
54,261 |
|
|
37,088 |
Total |
|
$ |
62,691 |
|
$ |
55,957 |
|
$ |
176,775 |
|
$ |
151,450 |
|
|
|
|
|
|
|
|
|
|
|
|
|
NCS Multistage (NASDAQ:NCSM)
과거 데이터 주식 차트
부터 6월(6) 2024 으로 7월(7) 2024
NCS Multistage (NASDAQ:NCSM)
과거 데이터 주식 차트
부터 7월(7) 2023 으로 7월(7) 2024