FTS International Announces Preliminary Third Quarter 2021 Financial and Operational Results
FTS International, Inc. (FTSI) has released its preliminary financial results for Q3 2021, reporting revenue between
- Revenue expected between $88.4 million and $93.4 million.
- Pricing is above expectations and anticipated to increase in Q4.
- Net loss of $9.5 million to $10.5 million.
- Underutilization due to customer scheduling changes resulted in a $7.6 million negative EBITDA impact.
- Utilization decreased from 91% in Q2 to 83% in Q3.
“The underutilization in the third quarter was caused by one-off customer-driven scheduling changes and downtime, which caused an estimated
“Despite this, we continue to work with our customers and have not experienced any losses on adverse market changes. While the underutilization caused a hardship in the third quarter, we believe that we are on track to deliver EBITDA in the mid-teens in the fourth quarter, despite inflationary pressures and impacts from the holidays.”
Preliminary Third Quarter Financial Results
-
Revenue of
$88.4 million $93.4 million -
SG&A, excluding stock-based compensation, of
$10.5 million $11.5 million -
Net loss of
$9.5 million $10.5 million -
Adjusted EBITDA of
$5.8 million $6.8 million -
Capital expenditures of approximately
$13 million
Operational Update
| Three Months Ended | ||||
| Successor | Successor | |||
2021 |
2021 |
|||
| Average active fleets | 13.0 |
13.0 |
||
| Utilization % |
|
|
||
| Fully-utilized fleets | 10.8 |
11.8 |
||
| Stages completed | 6,459 |
7,569 |
||
| Stages per fully-utilized fleet | 598 |
641 |
||
| Pumping hours | 12,864 |
15,548 |
||
| Pumping hours per fully-utilized fleet | 1,191 |
1,318 |
||
| Pumping days | 846 |
922 |
||
| Pumping hours per pumping day | 15.2 |
16.9 |
||
About
Headquartered in
To learn more, visit www.FTSI.com.
Preliminary Results
The unaudited preliminary financial and operational results for the third quarter 2021 represent the most current information available to management and are based on calculations or figures that have been prepared internally by management and have not been reviewed or audited by the Company’s independent registered public accounting firm. The Company’s actual results may differ from these preliminary financial and operational results due to the completion of the Company’s financial closing procedures, final adjustments and other developments that may arise between the date of this announcement and when results for the third quarter 2021 are finalized. The preliminary financial and operational results included in this announcement are not a comprehensive statement of the Company’s financial results and are subject to risks and uncertainties and should not be viewed as a substitute for full financial statements prepared in accordance with GAAP.
Important Information For Investors And Stockholders
This communication does not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities or a solicitation of any vote or approval. This communication relates to a proposed transaction between FTSI and
Participants in Solicitation
FTSI, Acquiror, their respective directors and certain of their respective executive officers may be considered participants in the solicitation of proxies in connection with the proposed transaction. Information about the directors and executive officers of FTSI is set forth in its Annual Report on Form 10-K for the fiscal year ended
These documents can be obtained free of charge from the sources indicated above. Additional information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement and other relevant materials to be filed with the
Forward Looking Statements
This communication contains “forward-looking statements” within the Private Securities Litigation Reform Act of 1995. Any statements contained in this communication that are not statements of historical fact, including statements about FTSI’s ability to consummate the proposed transaction, the expected benefits of the proposed transaction and the expected impact of the coronavirus pandemic (COVID-19) on FTSI's businesses may be deemed to be forward-looking statements. All such forward-looking statements are intended to provide management’s current expectations for the future of FTSI based on current expectations and assumptions relating to FTSI’s business, the economy and other future conditions. Forward-looking statements generally can be identified through the use of words such as “believes,” “anticipates,” “may,” “should,” “will,” “plans,” “projects,” “expects,” “expectations,” “estimates,” “forecasts,” “predicts,” “targets,” “prospects,” “strategy,” “signs,” and other words of similar meaning in connection with the discussion of future performance, plans, actions or events. Because forward-looking statements relate to the future, they are subject to inherent risks, uncertainties and changes in circumstances that are difficult to predict. Such risks and uncertainties include, among others: the failure to obtain the required vote of FTSI’s stockholders, the timing to consummate the proposed transaction, the risk that a condition of closing of the proposed transaction may not be satisfied or that the closing of the proposed transaction might otherwise not occur, the risk that a regulatory approval that may be required for the proposed transaction is not obtained or is obtained subject to conditions that are not anticipated, the diversion of management time on transaction-related issues, risks related to disruption of management time from ongoing business operations due to the proposed transaction, the risk that any announcements relating to the proposed transaction could have adverse effects on the market price of the common stock of FTSI, the risk that the proposed transaction and its announcement could have an adverse effect on the ability of FTSI to retain customers and retain and hire key personnel and maintain relationships with its suppliers and customers, economic or political changes that affect the markets that FTSI’s businesses serve which could have an effect on demand for FTSI’s products and impact FTSI’s profitability, disruptions in the credit and financial markets, including diminished liquidity and credit availability, disruptions in the Company's businesses from the coronavirus pandemic (COVID-19), cyber-security vulnerabilities, supply issues, retention of key employees, and outcomes of legal proceedings, claims and investigations, future changes, results of operations, domestic spending by the onshore oil and natural gas industry, continued volatility or future volatility in oil and natural gas prices, deterioration in general economic conditions or a continued weakening or future weakening of the broader energy industry, federal, state and local regulation of hydraulic fracturing and other oilfield service activities, as well as exploration and production activities, including public pressure on governmental bodies and regulatory agencies to regulate our industry, and the price and availability of alternative fuels, equipment and energy sources. Accordingly, actual results may differ materially from those contemplated by these forward-looking statements. Investors, therefore, are cautioned against relying on any of these forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future performance. Additional information regarding the factors that may cause actual results to differ materially from these forward-looking statements is available in FTSI’s filings with the
These forward-looking statements speak only as of the date of this communication, and FTSI does not assume any obligation to update or revise any forward-looking statement made in this communication or that may from time to time be made by or on behalf of the Company.
Non-GAAP Financial Measures
To provide investors with additional information regarding our financial results, we have disclosed here and elsewhere in this earnings release adjusted EBITDA, a non-GAAP financial measure that we calculate as earnings before net interest expense, taxes, and depreciation and amortization further adjusted for expenses that management believes are non-recurring, and/or non-core to business operations and other non-cash expenses, including but not limited to employee severance costs, stock-based compensation, balance sheet impairments and write-downs, gains or losses on extinguishment of debt, gains or losses on disposal of assets, supply commitment charges, restructuring items, transaction and strategic initiative costs.
Adjusted EBITDA is a key measure used by our management and board of directors to evaluate our operating performance and generate future operating plans. The exclusion of certain expenses facilitates operating performance comparability across reporting periods by removing the effect of non-cash expenses and certain variable charges. Accordingly, we believe that adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors.
Adjusted EBITDA has limitations as a financial measure and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:
- adjusted EBITDA does not reflect net interest expense or changes in, or cash requirements for, working capital;
- adjusted EBITDA does not reflect tax expense or benefits;
- although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future and adjusted EBITDA does not reflect capital expenditure requirements for such replacements or for new capital expenditures;
- adjusted EBITDA does not reflect gains or losses arising from the disposal of assets;
- adjusted EBITDA does not reflect stock-based compensation expenses. Stock-based compensation has been, and will continue to be for the foreseeable future, a recurring expense in our business and an important part of our compensation strategy;
- adjusted EBITDA does not reflect restructuring items or transaction and strategic initiative costs;
- other companies, including companies in our industry, may calculate adjusted EBITDA differently, which reduces its usefulness as a comparative measure.
Because of these limitations, you should consider adjusted EBITDA alongside other financial performance measures, including net loss and our other GAAP results.
The table included under “Reconciliation of Preliminary Net Loss to Adjusted EBITDA” provides a reconciliation of preliminary net loss to adjusted EBITDA for the third quarter 2021.
Reconciliation of Preliminary Net Loss to Adjusted EBITDA
| Three Months Ended |
|||||||||
| Successor | |||||||||
| (Dollars in millions) | Low | High | |||||||
| Net loss | $ |
(10.5 |
) |
$ |
(9.5 |
) |
|||
| Interest expense, net |
|
0.0 |
|
|
0.0 |
|
|||
| Income tax expense |
|
0.1 |
|
|
0.1 |
|
|||
| Depreciation and amortization |
|
13.1 |
|
|
13.1 |
|
|||
| Loss on disposal of assets, net |
|
1.6 |
|
|
1.6 |
|
|||
| Stock-based compensation |
|
0.7 |
|
|
0.7 |
|
|||
| Transaction and strategic initiative costs |
|
0.5 |
|
|
0.5 |
|
|||
| Reorganization items |
|
0.3 |
|
|
0.3 |
|
|||
| Adjusted EBITDA | $ |
5.8 |
|
$ |
6.8 |
|
|||
View source version on businesswire.com: https://www.businesswire.com/news/home/20211022005219/en/
Chief Financial Officer
817-862-2000
Source:
FAQ
What were FTS International's Q3 2021 revenue figures?
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