NCS Multistage Holdings, Inc. Announces Fourth Quarter and Full Year 2022 Results
NCS Multistage Holdings, Inc. (Nasdaq: NCSM) reported revenues of $40.2 million for Q4 2022, an 11% year-over-year increase. Net income rose to $2.0 million, up from $1.7 million in Q4 2021, leading to earnings per diluted share of $0.81. For the full year, revenues reached $155.6 million, a 31% increase, while the net loss improved to $(1.1) million from $(4.7) million in 2021. Adjusted EBITDA for the year was $15.1 million, a 66% increase. The company ended 2022 with $16.2 million in cash and $7.9 million in debt, maintaining a solid liquidity position.
- Q4 2022 revenue increased to $40.2 million, up 11% YoY.
- Net income rose to $2.0 million, improving from $1.7 million in Q4 2021.
- Full year revenue of $155.6 million, a 31% increase from 2021.
- Significant reduction in net loss to $(1.1) million in 2022 from $(4.7) million in 2021.
- Adjusted EBITDA improved to $15.1 million for 2022, up 66%.
- Q4 2022 revenue declined 18% compared to Q3 2022.
- Gross profit margin decreased from 41% in 2021 to 39% in 2022 due to increased costs.
Fourth Quarter Results
- Total revenues of
$40.2 million , an11% year-over-year increase - Net income of
$2.0 million , compared to$1.7 million for the fourth quarter of 2021, a$0.3 million improvement resulting in earnings per diluted share of$0.81 - Adjusted EBITDA of
$6.4 million , slightly below the fourth quarter of 2021 $16.2 million in cash and$7.9 million of total debt as of December 31, 2022
Full Year Results
- Total revenues of
$155.6 million , a31% increase over the prior year - Net loss of
$(1.1) million , compared to a net loss of$(4.7) million in 2021, a$3.6 million improvement resulting in loss per diluted share of$(0.45) - Adjusted EBITDA of
$15.1 million , compared to$9.1 million in 2021, a$6.0 million improvement
HOUSTON, March 06, 2023 (GLOBE NEWSWIRE) -- 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 construction, well completions and field development strategies, today announced its results for the quarter and year ended December 31, 2022.
Financial Review
Fourth Quarter 2022 Financial Results
Total revenues were
Gross profit, which we define as total revenues less total cost of sales exclusive of depreciation and amortization, was
Selling, general and administrative expenses totaled
Net income was
Adjusted EBITDA was
Full Year 2022 Financial Results
For the year ended December 31, 2022, NCS reported revenues of
Cash flows from operating activities for the year ended December 31, 2022 was a use of
Capital Expenditures and Liquidity
As of December 31, 2022, NCS had
NCS incurred capital expenditures, net of proceeds from the sale of property and equipment, of
Review and Outlook
NCS’s Chief Executive Officer, Ryan Hummer commented, “Our performance in the fourth quarter, while declining sequentially from our strong third quarter due in part to seasonality and customer budget exhaustion, capped a strong year for NCS in 2022, as we continue to capitalize on what we believe will be a multi-year growth cycle for our industry.
Our full year 2022 revenue of
This revenue growth was supported by specific sales initiatives and the continued commercialization of new products which expand the addressable market that we participate in. In Canada, our focus on growing customer adoption of our Well Construction products, leveraging the strong relationships and market share we have in Fracturing Systems, has resulted in significant growth in that product line. During 2022, we made our first sale to a new customer in the North Sea for Fracturing Systems products and services. In addition, Repeat Precision commercialized the PurpleFire perforating gun system, which was undergoing field trials at this time last year.
We faced increased supply chain costs during the year which were only partially offset by pricing increases achieved with our customers, which led to a reduction in our gross margin percentage from
As a result, we were able to grow Adjusted EBITDA by over
We maintain a strong balance sheet and liquidity position. During 2022, we upsized and extended our ABL facility to reflect the growth in our business. We ended 2022 with over
Our free cash flow for the year of
Based on E&P company announced capital budgets for 2023, we believe that annual average industry drilling and completion activity in the United States and Canada in 2023 will be equal to 2022 levels or higher by up to
We believe the value that we bring to our customers across our product and service portfolio, together with continued product and service innovation, positions us to outperform the underlying market activity growth that we expect in the United States, Canada and internationally, as we grow our market share and access new markets. In support of this anticipated growth, we expect to increase our capital spending to within a range of
As we look to 2023, we will be focused on maximizing our near-term opportunities and taking action to ensure long-term success in alignment with our core strategies of: i) building upon our leading market positions; ii) capitalizing on international and offshore opportunities; and iii) commercializing innovative solutions to complex customer challenges.
I am excited for 2023 and want to express my thanks to the team at NCS and at Repeat Precision. I truly appreciate the hard work and dedication of our outstanding people. We have the right team, the right technology, and the right strategies in place to deliver extraordinary outcomes to our customers, drive innovation in the industry and to create value for our shareholders.”
Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA Less Share-Based Compensation, Adjusted Net Income (Loss), Adjusted Earnings (Loss) per Diluted Share, Free Cash Flow, Free Cash Flow Less Distributions to Non-Controlling Interest and net working capital 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 fourth quarter and full year 2022 results and updated guidance on Tuesday, March 7, 2023 at 7:30 a.m. Central Time (8:30 a.m. Eastern Time). To access the conference call, please dial 1-833-630-1956 and ask to join the NCS Multistage call. It is recommended that participants join at least 10 minutes prior to the event start.
The replay will 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 construction, well completions and field development strategies. NCS provides products and services primarily to exploration and production companies for use in onshore and offshore wells, predominantly wells that have been drilled with horizontal laterals in both unconventional and conventional oil and natural gas formations. NCS’s products and services are utilized in oil and natural gas basins throughout North America and in selected international markets, including Argentina, China, the Middle East and the North Sea. NCS’s common stock is traded on the Nasdaq Capital 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 in Canada, the United States and internationally; oil and natural gas price fluctuations; significant competition for our products and services that results in pricing pressures, reduced sales, or reduced market share; our inability to successfully develop and implement new technologies, products and services that align with the needs of our customers, including addressing the shift to more non-traditional energy markets as part of the energy transition; inability to successfully implement our strategy of increasing sales of products and services into the U.S. and international markets; loss of significant customers; our inability to protect and maintain critical intellectual property assets; losses and liabilities from uninsured or underinsured business activities; our failure to identify and consummate potential acquisitions; our inability to integrate or realize the expected benefits from acquisitions; loss of any of our key suppliers or significant disruptions negatively impacting our supply chain; our inability to achieve suitable price increases to offset the impacts of cost inflation; risks in attracting and retaining qualified employees and key personnel or related to labor cost inflation; risks resulting from the operations of our joint venture arrangement; 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; changes in legislation or regulation governing the oil and natural gas industry, including restrictions on emissions of greenhouse gases; our inability to meet regulatory requirements for use of certain chemicals by our tracer diagnostics business; change in trade policy, including the impact of tariffs; our inability to accurately predict customer demand, which may result in us holding excess or obsolete inventory; failure to comply with or changes to federal, state and local and non-U.S. laws and other regulations, including anti-corruption and environmental regulations, guidelines and regulations for the use of explosives; the financial health of our customers including their ability to pay for products or services provided; loss of our information and computer systems; system interruptions or failures, including complications with our enterprise resource planning system, cyber-security breaches, identity theft or other disruptions that could compromise our information; impairment in the carrying value of long-lived assets including goodwill; our failure to establish and maintain effective internal control over financial reporting; the reduction in our ABL Facility borrowing base or our inability to comply with the covenants in our debt agreements; and our inability to obtain sufficient liquidity on reasonable terms, or at all 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
Michael Morrison
Chief Financial Officer
(281) 453-2222
IR@ncsmultistage.com
NCS MULTISTAGE HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
| Three Months Ended | Year Ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||
| Revenues | ||||||||||||||||
| Product sales | $ | 26,310 | $ | 26,056 | $ | 105,859 | $ | 83,223 | ||||||||
| Services | 13,876 | 10,060 | 49,773 | 35,279 | ||||||||||||
| Total revenues | 40,186 | 36,116 | 155,632 | 118,502 | ||||||||||||
| Cost of sales | ||||||||||||||||
| Cost of product sales, exclusive of depreciation and amortization expense shown below | 16,502 | 14,410 | 68,412 | 51,897 | ||||||||||||
| Cost of services, exclusive of depreciation and amortization expense shown below | 7,606 | 5,776 | 26,816 | 18,130 | ||||||||||||
| Total cost of sales, exclusive of depreciation and amortization expense shown below | 24,108 | 20,186 | 95,228 | 70,027 | ||||||||||||
| Selling, general and administrative expenses | 13,190 | 13,505 | 58,338 | 49,094 | ||||||||||||
| Depreciation | 908 | 975 | 3,650 | 3,832 | ||||||||||||
| Amortization | 167 | 167 | 669 | 669 | ||||||||||||
| Income (loss) from operations | 1,813 | 1,283 | (2,253 | ) | (5,120 | ) | ||||||||||
| Other income (expense) | ||||||||||||||||
| Interest expense, net | (221 | ) | (204 | ) | (1,015 | ) | (733 | ) | ||||||||
| Other income, net | 1,394 | 1,008 | 2,950 | 2,054 | ||||||||||||
| Foreign currency exchange gain (loss) | 279 | 127 | (283 | ) | 283 | |||||||||||
| Total other income | 1,452 | 931 | 1,652 | 1,604 | ||||||||||||
| Income (loss) before income tax | 3,265 | 2,214 | (601 | ) | (3,516 | ) | ||||||||||
| Income tax expense | 974 | 218 | 351 | 263 | ||||||||||||
| Net income (loss) | 2,291 | 1,996 | (952 | ) | (3,779 | ) | ||||||||||
| Net income attributable to non-controlling interest | 312 | 334 | 150 | 955 | ||||||||||||
| Net income (loss) attributable to NCS Multistage Holdings, Inc. | $ | 1,979 | $ | 1,662 | $ | (1,102 | ) | $ | (4,734 | ) | ||||||
| Earnings (loss) per common share | ||||||||||||||||
| Basic earnings (loss) per common share attributable to NCS Multistage Holdings, Inc. | $ | 0.81 | $ | 0.69 | $ | (0.45 | ) | $ | (1.98 | ) | ||||||
| Diluted earnings (loss) per common share attributable to NCS Multistage Holdings, Inc. | $ | 0.81 | $ | 0.68 | $ | (0.45 | ) | $ | (1.98 | ) | ||||||
| Weighted average common shares outstanding | ||||||||||||||||
| Basic | 2,439 | 2,402 | 2,432 | 2,396 | ||||||||||||
| Diluted | 2,452 | 2,455 | 2,432 | 2,396 | ||||||||||||
NCS MULTISTAGE HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS*
(In thousands, except share data)
| December 31, | December 31, | |||||||
| 2022 | 2021 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 16,234 | $ | 22,168 | ||||
| Accounts receivable—trade, net | 27,846 | 24,392 | ||||||
| Inventories, net | 37,042 | 33,917 | ||||||
| Prepaid expenses and other current assets | 2,815 | 3,290 | ||||||
| Other current receivables | 3,726 | 4,726 | ||||||
| Total current assets | 87,663 | 88,493 | ||||||
| Noncurrent assets | ||||||||
| Property and equipment, net | 23,316 | 24,708 | ||||||
| Goodwill | 15,222 | 15,222 | ||||||
| Identifiable intangibles, net | 5,076 | 5,744 | ||||||
| Operating lease assets | 4,515 | 4,809 | ||||||
| Deposits and other assets | 2,761 | 3,113 | ||||||
| Deferred income taxes, net | 46 | 236 | ||||||
| Total noncurrent assets | 50,936 | 53,832 | ||||||
| Total assets | $ | 138,599 | $ | 142,325 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable—trade | $ | 7,549 | $ | 7,502 | ||||
| Accrued expenses | 4,391 | 6,323 | ||||||
| Income taxes payable | 468 | 294 | ||||||
| Operating lease liabilities | 1,274 | 1,556 | ||||||
| Current maturities of long-term debt | 1,489 | 1,483 | ||||||
| Other current liabilities | 2,522 | 2,660 | ||||||
| Total current liabilities | 17,693 | 19,818 | ||||||
| Noncurrent liabilities | ||||||||
| Long-term debt, less current maturities | 6,437 | 6,335 | ||||||
| Operating lease liabilities, long-term | 3,680 | 3,779 | ||||||
| Other long-term liabilities | 1,328 | 1,612 | ||||||
| Deferred income taxes, net | 199 | 114 | ||||||
| Total noncurrent liabilities | 11,644 | 11,840 | ||||||
| Total liabilities | 29,337 | 31,658 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity | ||||||||
| Preferred stock, | — | — | ||||||
| December 31, 2022 and December 31, 2021 | ||||||||
| Common stock, | ||||||||
| and 2,408,474 shares outstanding at December 31, 2022 and 2,397,766 shares issued | ||||||||
| and 2,380,374 shares outstanding at December 31, 2021 | 24 | 24 | ||||||
| Additional paid-in capital | 440,475 | 437,022 | ||||||
| Accumulated other comprehensive loss | (85,617 | ) | (82,094 | ) | ||||
| Retained deficit | (262,464 | ) | (261,362 | ) | ||||
| Treasury stock, at cost; 26,335 shares at December 31, 2022 and 17,392 shares | ||||||||
| at December 31, 2021 | (1,389 | ) | (1,006 | ) | ||||
| Total stockholders’ equity | 91,029 | 92,584 | ||||||
| Non-controlling interest | 18,233 | 18,083 | ||||||
| Total equity | 109,262 | 110,667 | ||||||
| Total liabilities and stockholders' equity | $ | 138,599 | $ | 142,325 | ||||
_____________________
*Preliminary
NCS MULTISTAGE HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
| Year Ended December 31, | ||||||||
| 2022 | 2021 | |||||||
| (Unaudited) | ||||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ | (952 | ) | $ | (3,779 | ) | ||
| Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||||||||
| Depreciation and amortization | 4,319 | 4,501 | ||||||
| Amortization of deferred loan cost | 231 | 281 | ||||||
| Write-off of deferred loan costs | 196 | — | ||||||
| Share-based compensation | 6,039 | 6,621 | ||||||
| Provision for inventory obsolescence | 2,542 | 1,754 | ||||||
| Deferred income tax expense | 266 | 96 | ||||||
| Gain on sale of property and equipment | (361 | ) | (378 | ) | ||||
| Provision for doubtful accounts | (61 | ) | (129 | ) | ||||
| Proceeds from note receivable | 590 | 281 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable—trade | (4,860 | ) | (2,558 | ) | ||||
| Inventories, net | (7,678 | ) | (939 | ) | ||||
| Prepaid expenses and other assets | 1,347 | (437 | ) | |||||
| Accounts payable—trade | 1,224 | 2,843 | ||||||
| Accrued expenses | (1,777 | ) | 3,000 | |||||
| Other liabilities | (2,852 | ) | (3,247 | ) | ||||
| Income taxes receivable/payable | 364 | 3,673 | ||||||
| Net cash (used in) provided by operating activities | (1,423 | ) | 11,583 | |||||
| Cash flows from investing activities | ||||||||
| Purchases of property and equipment | (1,035 | ) | (495 | ) | ||||
| Purchase and development of software and technology | (96 | ) | (338 | ) | ||||
| Proceeds from sales of property and equipment | 433 | 389 | ||||||
| Net cash used in investing activities | (698 | ) | (444 | ) | ||||
| Cash flows from financing activities | ||||||||
| Payments on finance leases | (1,463 | ) | (1,318 | ) | ||||
| Line of credit borrowings | 11,780 | 360 | ||||||
| Payments of line of credit borrowings | (11,724 | ) | (360 | ) | ||||
| Treasury shares withheld | (383 | ) | (197 | ) | ||||
| Distribution to non-controlling interest | — | (2,750 | ) | |||||
| Payment of deferred loan cost related to ABL facility | (952 | ) | — | |||||
| Net cash used in financing activities | (2,742 | ) | (4,265 | ) | ||||
| Effect of exchange rate changes on cash and cash equivalents | (1,071 | ) | (251 | ) | ||||
| Net change in cash and cash equivalents | (5,934 | ) | 6,623 | |||||
| Cash and cash equivalents beginning of period | 22,168 | 15,545 | ||||||
| Cash and cash equivalents end of period | $ | 16,234 | $ | 22,168 | ||||
| Supplemental cash flow information | ||||||||
| Cash paid for interest, net of amounts capitalized | $ | 557 | $ | 423 | ||||
| Cash paid for income taxes (net of refunds) | (303 | ) | (3,528 | ) | ||||
| Noncash investing and financing activities | ||||||||
| Assets obtained in exchange for new finance lease liabilities | 1,788 | 3,712 | ||||||
| Assets obtained in exchange for new operating lease liabilities | 1,450 | 2,000 | ||||||
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 operating performance or which, in the case of share-based compensation, is non-cash in nature. Adjusted EBITDA margin represents Adjusted EBITDA as a percentage of total revenues. Adjusted EBITDA Less Share-Based Compensation is defined as Adjusted EBITDA minus share-based compensation expense. Adjusted Net Income (Loss) 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. Adjusted Earnings (Loss) per Diluted Share is defined as Adjusted Net Income (Loss) divided by our diluted weighted average common shares outstanding during the relevant period. Free cash flow is defined as net cash (used in) provided by operating activities less purchases of property and equipment (inclusive of the purchase and development of software and technology) plus proceeds from sales of property and equipment, as presented in our consolidated statement of cash flows. We define free cash flow less distributions to non-controlling interest as free cash flow less distributions to non-controlling interest, as presented in the net cash used in financing activities section of our consolidated statements of cash flows. Net working capital is defined as total current assets, excluding cash and cash equivalents, minus total current liabilities, excluding current maturities of long-term debt. Net working capital excludes cash and cash equivalents and current maturities of long-term debt in order to evaluate the investment in working capital required to support our business. We believe that Adjusted EBITDA, Adjusted Net Income (Loss) and Adjusted Earnings (Loss) 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. We believe that Adjusted EBITDA Less Share-Based Compensation presents our financial performance in a manner that is comparable to the presentation provided by many of our peers. We believe free cash flow is useful because it provides information to investors regarding the cash that was available in the period that was in excess of our needs to fund our capital expenditures and other investment needs. We believe that free cash flow less distributions to non-controlling interest is useful because it provides information to investors regarding the cash that was available in the period that was in excess of our needs to fund our capital expenditures, other investment needs, and cash distributions to our joint venture partner. We believe that net working capital is useful in analyzing the cash flow and working capital needs of the Company, including determining the efficiencies of our operations and our ability to readily convert assets into cash. Accordingly, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA Less Share-Based Compensation, Adjusted Net Income (Loss), Adjusted Earnings (Loss) per Diluted Share, Free Cash Flow, Free Cash Flow Less Distributions to Non-Controlling Interest and net working capital are key metrics that management uses to assess the period-to-period performance of our core business operations. We believe that presenting these metrics enables investors to assess our performance from period to period using the same metrics utilized by management and to evaluate our performance relative to other companies that are not subject to such factors.
EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA Less Share-Based Compensation, Adjusted Net Income (Loss), Adjusted Earnings (Loss) per Diluted Share, Free Cash Flow, Free Cash Flow Less Distributions to Non-Controlling Interest and net working capital (our “non-GAAP financial measures”) are not defined under generally accepted accounting principles (“GAAP”), are not measures of net income (loss), income from operations, cash (used in) provided by operating activities, working capital 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), income from operations, cash (used in) provided by operating activities, working capital 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 measures of financial performance calculated under GAAP:
NET WORKING CAPITAL*
| December 31, | December 31, | |||||||
| 2022 | 2021 | |||||||
| Working capital | $ | 69,970 | $ | 68,675 | ||||
| Cash and cash equivalents | (16,234 | ) | (22,168 | ) | ||||
| Current maturities of long-term debt | 1,489 | 1,483 | ||||||
| Net working capital | $ | 55,225 | $ | 47,990 | ||||
_____________________
* Preliminary
NCS MULTISTAGE HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(In thousands, except per share data)
(Unaudited)
ADJUSTED NET INCOME (LOSS) AND ADJUSTED EARNNGS (LOSS) PER DILUTED SHARE
| Three Months Ended | Year Ended | |||||||||||||||||||||||||||||||
| December 31, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | |||||||||||||||||||||||||||||
| Effect on Net Income | Impact on Diluted Earnings Per Share | Effect on Net Income | Impact on Diluted Earnings Per Share | Effect on Net Loss | Impact on Diluted Loss Per Share | Effect on Net Loss | Impact on Diluted Loss Per Share | |||||||||||||||||||||||||
| Net income (loss) attributable to NCS Multistage Holdings, Inc. | $ | 1,979 | $ | 0.81 | $ | 1,662 | $ | 0.68 | $ | (1,102 | ) | $ | (0.45 | ) | $ | (4,734 | ) | $ | (1.98 | ) | ||||||||||||
| Adjustments | ||||||||||||||||||||||||||||||||
| Realized and unrealized foreign currency (gain) loss (a) | (197 | ) | (0.08 | ) | (123 | ) | (0.05 | ) | 365 | 0.15 | (307 | ) | (0.13 | ) | ||||||||||||||||||
| Write-off of deferred loan costs (b) | — | — | — | — | 196 | 0.08 | — | — | ||||||||||||||||||||||||
| Net effect of ERC (c) | — | — | (1 | ) | — | — | — | (1,908 | ) | (0.79 | ) | |||||||||||||||||||||
| Income tax impact from adjustments (d) | (215 | ) | (0.09 | ) | (350 | ) | (0.15 | ) | (354 | ) | (0.15 | ) | (96 | ) | (0.04 | ) | ||||||||||||||||
| Adjusted net income (loss) attributable to NCS Multistage Holdings, Inc. | $ | 1,567 | $ | 0.64 | $ | 1,188 | $ | 0.48 | $ | (895 | ) | $ | (0.37 | ) | $ | (7,045 | ) | $ | (2.94 | ) | ||||||||||||
| __________________ | |
| (a) | Represents realized and unrealized foreign currency translation gains and losses attributable to NCS Multistage Holdings, Inc. primarily due to movement in the foreign currency exchange rates during the applicable periods. |
| (b) | Represents deferred loan costs of |
| (c) | Represents U.S. employee retention credit (“ERC”) benefits recorded during the third quarter of 2021 less the effect on bonus and associated payroll burden accruals. |
| (d) | Represents income tax adjustments including valuation allowance applied to deferred tax assets and effect of expiring stock options. |
NCS MULTISTAGE HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(In thousands)
(Unaudited)
ADJUSTED EBITDA, ADJUSTED EBITDA MARGIN, AND ADJUSTED EBITDA LESS SHARE-BASED COMPENSATION
__
| Three Months Ended | Year Ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Net income (loss) | $ | 2,291 | $ | 1,996 | $ | (952 | ) | $ | (3,779 | ) | ||||||
| Income tax expense | 974 | 218 | 351 | 263 | ||||||||||||
| Interest expense, net | 221 | 204 | 1,015 | 733 | ||||||||||||
| Depreciation | 908 | 975 | 3,650 | 3,832 | ||||||||||||
| Amortization | 167 | 167 | 669 | 669 | ||||||||||||
| EBITDA | 4,561 | 3,560 | 4,733 | 1,718 | ||||||||||||
| Share-based compensation (a) | 953 | 982 | 3,453 | 4,221 | ||||||||||||
| Professional fees (b) | 846 | 2,062 | 5,665 | 4,885 | ||||||||||||
| Net benefit of ERC (c) | — | (1 | ) | — | (1,908 | ) | ||||||||||
| Foreign currency (gain) loss (d) | (279 | ) | (127 | ) | 283 | (283 | ) | |||||||||
| Other (e) | 317 | 15 | 976 | 461 | ||||||||||||
| Adjusted EBITDA | $ | 6,398 | $ | 6,491 | $ | 15,110 | $ | 9,094 | ||||||||
| Adjusted EBITDA Margin | 16 | % | 18 | % | 10 | % | 8 | % | ||||||||
| Adjusted EBITDA Less Share-Based Compensation | $ | 5,445 | $ | 5,509 | $ | 11,657 | $ | 4,873 | ||||||||
| ___________________ | |
| (a) | Represents non-cash compensation charges related to share-based compensation granted to our officers, employees and directors. |
| (b) | Represents non-capitalizable costs of professional services incurred in connection with our financings, legal proceedings and the evaluation of potential acquisitions. |
| (c) | Represents ERC benefits recorded during the third quarter of 2021 less the effect on bonus and associated payroll burden accruals. |
| (d) | Represents realized and unrealized foreign currency translation gains and losses primarily due to movement in the foreign currency exchange rates during the applicable periods. |
| (e) | Represents the impact of a research and development subsidy that is included in income tax expense in accordance with GAAP along with other charges and credits. |
FREE CASH FLOW AND FREE CASH FLOW LESS DISTRIBUTIONS TO NON-CONTROLLING INTEREST
| Year Ended December 31, | ||||||||
| 2022 | 2021 | |||||||
| Net cash (used in) provided by operating activities | $ | (1,423 | ) | $ | 11,583 | |||
| Purchases of property and equipment | (1,035 | ) | (495 | ) | ||||
| Purchase and development of software and technology | (96 | ) | (338 | ) | ||||
| Proceeds from sales of property and equipment | 433 | 389 | ||||||
| Free cash flow | $ | (2,121 | ) | $ | 11,139 | |||
| Distributions to non-controlling interest | — | (2,750 | ) | |||||
| Free cash flow less distributions to non-controlling interest | $ | (2,121 | ) | $ | 8,389 | |||
NCS MULTISTAGE HOLDINGS, INC.
REVENUES BY GEOGRAPHIC AREA
(In thousands)
(Unaudited)
| Three Months Ended | Year Ended | |||||||||||
| December 31, | December 31, | |||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||
| United States | ||||||||||||
| Product sales | $ | 9,458 | $ | 7,523 | $ | 34,009 | $ | 26,285 | ||||
| Services | 4,057 | 2,542 | 12,228 | 8,870 | ||||||||
| Total United States | 13,515 | 10,065 | 46,237 | 35,155 | ||||||||
| Canada | ||||||||||||
| Product sales | 16,721 | 16,524 | 71,176 | 53,401 | ||||||||
| Services | 8,014 | 5,029 | 29,695 | 19,682 | ||||||||
| Total Canada | 24,735 | 21,553 | 100,871 | 73,083 | ||||||||
| Other Countries | ||||||||||||
| Product sales | 131 | 2,009 | 674 | 3,537 | ||||||||
| Services | 1,805 | 2,489 | 7,850 | 6,727 | ||||||||
| Total Other Countries | 1,936 | 4,498 | 8,524 | 10,264 | ||||||||
| Total | ||||||||||||
| Product sales | 26,310 | 26,056 | 105,859 | 83,223 | ||||||||
| Services | 13,876 | 10,060 | 49,773 | 35,279 | ||||||||
| Total revenues | $ | 40,186 | $ | 36,116 | $ | 155,632 | $ | 118,502 | ||||
FAQ
What were NCSM's Q4 2022 total revenues?
How much did NCSM's net income increase in Q4 2022?
What was NCSM's revenue for the full year 2022?
What was the adjusted EBITDA for NCSM in 2022?
What is the cash position of NCSM as of December 31, 2022?
