Oil States Announces Fourth Quarter 2021 Results of Operations

Rhea-AI Summary

Oil States International reported a net loss of $19.9 million, or $0.33 per share, for Q4 2021, influenced by non-cash impairment charges and a foreign currency translation loss. Revenues rose to $161.3 million, up from $140.5 million in Q3 2021, with Adjusted EBITDA increasing 57% to $13.4 million. The Offshore/Manufactured Products segment saw a 34% revenue growth, driven by a 72% rise in project-related revenue. The company's backlog reached $260 million, with a book-to-bill ratio of 1.1x for Q4. For the full year, Oil States reported a net loss of $64 million on revenues of $573.2 million.

Positive

• Revenue increased to $161.3 million, up 15% sequentially.
• Adjusted EBITDA rose 57% sequentially to $13.4 million.
• Offshore/Manufactured Products segment revenue up 34%, driven by project-related sales.
• Backlog increased to $260 million, with a book-to-bill ratio of 1.1x for Q4.

Negative

• Net loss of $19.9 million for Q4 2021, including $9.3 million foreign currency loss.
• Full-year net loss of $64 million, or $1.06 per share.
• Well Site Services segment revenue down 6% due to seasonal decline.

HOUSTON, Feb. 16, 2022 (GLOBE NEWSWIRE) -- Oil States International, Inc. (NYSE: OIS) reported a net loss of $19.9 million, or $0.33 per share, for the fourth quarter of 2021. The reported results included: non-cash impairment charges of $2.2 million ($1.7 million after tax, or $0.03 per share) related to write-downs of inventories and fixed assets; severance and restructuring charges of $0.8 million ($0.6 million after-tax, or $0.01 per share); and a non-cash foreign currency translation loss of $9.3 million ($9.3 million after-tax, or $0.15 per share) reclassified from other comprehensive income upon exit of the Company's Argentinian operation. After excluding these charges, the Company's adjusted net loss was $8.2 million, or $0.14 per share.

During the fourth quarter of 2021, the Company generated revenues of $161.3 million and Adjusted Consolidated EBITDA (Note A) of $13.4 million. These results compare to revenues of $140.5 million and Adjusted Consolidated EBITDA of $8.5 million reported in the third quarter of 2021.

Fourth quarter 2021 highlights included:

• Offshore/Manufactured Products segment revenue and Adjusted Segment EBITDA (Note B) increased sequentially 34% and 59%, respectively, driven by a 72% increase in project-related revenue
• Offshore/Manufactured Products backlog increased $11 million to $260 million, with a book-to-bill ratio of 1.1x, augmented by one notable project award exceeding $10 million
• Well Site Services Adjusted Segment EBITDA increased sequentially to $6.2 million despite a modest seasonal reduction in revenue

Oil States' President and Chief Executive Officer, Cindy B. Taylor, stated,

"Our consolidated revenues and Adjusted Consolidated EBITDA increased sequentially by 15% and 57%, respectively, despite global challenges associated with the COVID-19 pandemic, supply chain disruptions and a modest seasonal decline in U.S. customer completion activity in the Northeast.

"Revenues in our Offshore/Manufactured Products segment led the growth, with a 34% sequential increase driven primarily by higher sales of project-driven production, testing and connector products. Adjusted Segment EBITDA for Offshore/Manufactured Products increased $5.1 million, or 59%, sequentially totaling $13.7 million, reflective of the revenue growth. Backlog grew to $260 million at December 31, 2021 with quarterly bookings of $105 million, yielding book-to-bill ratios of 1.1x for the fourth quarter and 1.2x for the full-year 2021.

"Our Well Site Services segment revenues decreased 6% from the prior quarter due to a seasonal decline in customer activity in our U.S. Rocky Mountain and Northeast regions coupled with slower activity stemming from ongoing infrastructure repairs by operators in the Gulf of Mexico following Hurricane Ida. However, Adjusted Segment EBITDA increased sequentially for the fifth consecutive quarter, given a more favorable revenue mix and the benefit of cost control measures.

"Fourth quarter revenues in our Downhole Technologies segment were up modestly from the third quarter, driven by higher sales of our domestic perforating products.

"We continue to focus on delivering superior products and services to our customers, which are expected to provide sustainable returns to the Company and its stakeholders as industry activity continues to recover from the harsh effects of the COVID-19 pandemic. We are focused on profitable product and service lines and will allocate capital accordingly. With this focus, stockholders' returns should continue to improve."

For the year ended December 31, 2021, the Company reported a net loss of $64.0 million, or $1.06 per share, revenues of $573.2 million and Adjusted Consolidated EBITDA of $38.1 million. The full-year 2021 results included: non-cash impairment charges of $7.7 million ($6.1 million after-tax, or $0.10 per share) related to write-downs of inventories and fixed and lease assets; severance and restructuring charges of $7.5 million ($5.9 million after-tax, or $0.10 per share); a non-cash foreign currency translation loss of $9.3 million ($9.3 million after-tax, or $0.15 per share) reclassified from other comprehensive income upon exit of the Company's Argentinian operation; and non-cash gains of $4.0 million ($3.2 million after-tax, or $0.05 per share) associated with debt extinguishments. After excluding these charges and credits, the Company’s adjusted net loss was $45.8 million, or $0.76 per share.

BUSINESS SEGMENT RESULTS

(See Segment Data tables)

Offshore/Manufactured Products

Offshore/Manufactured Products reported revenues of $92.2 million and Adjusted Segment EBITDA of $13.7 million in the fourth quarter of 2021, compared to revenues of $69.0 million and Adjusted Segment EBITDA of $8.6 million reported in the third quarter of 2021. Revenues increased 34% sequentially, driven primarily by increases in project-driven and service revenues of 72% and 17%, respectively. Adjusted Segment EBITDA margin in the fourth quarter of 2021 was 15%, compared to 12% in the third quarter of 2021.

Backlog totaled $260 million as of December 31, 2021, a 4% sequential increase from September 30, 2021. During the fourth quarter of 2021, the segment received one notable project award exceeding $10 million. Fourth quarter 2021 bookings totaled $105 million, yielding a quarterly book-to-bill ratio of 1.1x and a full-year ratio of 1.2x.

Well Site Services

Well Site Services reported revenues of $43.3 million and Adjusted Segment EBITDA of $6.2 million in the fourth quarter of 2021, compared to revenues of $46.0 million and Adjusted Segment EBITDA of $5.9 million reported in the third quarter of 2021. Adjusted Segment EBITDA margin the fourth quarter of 2021 was 14%, compared to 13% in the third quarter of 2021.

In the fourth quarter of 2021, the segment recorded non-cash inventory and fixed asset impairment charges of $2.2 million due to the decision to exit certain non-performing service lines.

Downhole Technologies

Downhole Technologies reported revenues of $25.8 million and Adjusted Segment EBITDA of $0.1 million in the fourth quarter of 2021, compared to revenues of $25.5 million and Adjusted Segment EBITDA of $1.4 million reported in the third quarter of 2021. During the fourth quarter 2021, the segment recorded bad debt expense of $0.7 million on a receivable from a customer which announced liquidation in January 2022. Adjusted Segment EBITDA margin in the fourth quarter of 2021 was 1%, compared to 6% in the third quarter of 2021.

Corporate

Corporate operating expenses in the fourth quarter of 2021 totaled $6.7 million.

Interest Expense, Net

Net interest expense totaled $2.6 million in the fourth quarter of 2021, which included $0.5 million of non-cash amortization of deferred debt issuance costs.

Other Income (Expense), Net

In the fourth quarter of 2021, the Company recognized a $9.3 million non-cash loss associated with the reclassification of unrealized foreign currency translation adjustments to net income (loss), which were released upon the liquidation of the Company's Argentinian operation. An offsetting non-cash benefit was recognized as other comprehensive income in the fourth quarter.

Income Taxes

The Company recognized an effective tax rate benefit of 1% in the fourth quarter of 2021, which compared to an effective tax rate benefit of 21% in the third quarter of 2021. The effective tax rate benefit for the fourth quarter of 2021 was below the U.S. statutory rate primarily due to certain non-deductible expenses, including the non-cash currency translation loss.

Financial Condition

No borrowings were outstanding under the Company's asset-based revolving credit facility (the "ABL Facility") at December 31, 2021. Cash totaled $52.9 million, compared to $67.6 million at September 30, 2021. Liquidity (cash plus borrowing availability) totaled $101.7 million at December 31, 2021 with amounts available to be drawn under the ABL Facility totaling $48.9 million.

The Company's total debt represented 20% of combined total debt and stockholders' equity as of December 31, 2021 and 2020.

Conference Call Information

The call is scheduled for February 17, 2022 at 9:00 a.m. central standard time, is being webcast and can be accessed from the Company's website at www.ir.oilstatesintl.com. Participants may also join the conference call by dialing 1 (888) 771-4371 in the United States or by dialing +1 (847) 585-4405 internationally and using the passcode 50277012. A replay of the conference call will be available one and a half hours after the completion of the call and can be accessed from the Company's website at www.ir.oilstatesintl.com.

About Oil States

Oil States International, Inc. is a global provider of manufactured products and services to customers in the energy, industrial and military sectors. The Company's manufactured products include highly engineered capital equipment and consumable products. Oil States is headquartered in Houston, Texas with manufacturing and service facilities strategically located across the globe. Oil States is publicly traded on the New York Stock Exchange under the symbol "OIS".

For more information on the Company, please visit Oil States International's website at www.oilstatesintl.com.

Forward Looking Statements

The foregoing contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are those that do not state historical facts and are, therefore, inherently subject to risks and uncertainties. The forward-looking statements included herein are based on current expectations and entail various risks and uncertainties that could cause actual results to differ materially from those forward-looking statements. Such risks and uncertainties include, among others, the level of supply of and demand for oil and natural gas, fluctuations in the prices thereof, the cyclical nature of the oil and natural gas industry, the impact of the COVID-19 pandemic on the Company and its customers, the other risks associated with the general nature of the energy service industry and other factors discussed in the "Business" and "Risk Factors" sections of the Company's Annual Report on Form 10-K for the year ended December 31, 2020 and the subsequently filed Periodic Reports on Form 8-K. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof, and, except as required by law, the Company undertakes no obligation to update those statements or to publicly announce the results of any revisions to any of those statements to reflect future events or developments.

OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Amounts)

	Three Months Ended												Year Ended
	December 31, 2021				September 30, 2021				December 31, 2020				December 31, 2021				December 31, 2020
	(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Revenues:
Products	$	89,401			$	70,409			$	73,051			$	299,293			$	331,272
Services		71,919				70,119				64,326				273,868				306,803
		161,320				140,528				137,377				573,161				638,075
Costs and expenses:
Product costs		72,890				60,310				62,992				246,589				287,615
Service costs		60,357				56,897				52,517				223,807				274,190
Cost of revenues (exclusive of depreciation and amortization expense presented below)(1)		133,247				117,207				115,509				470,396				561,805
Selling, general and administrative expense		20,297				20,078				22,597				83,692				94,102
Depreciation and amortization expense		18,655				19,657				23,237				80,741				98,543
Impairments of goodwill		—				—				—				—				406,056
Impairments of fixed and lease assets		722				—				4,257				4,166				12,447
Other operating income, net		(328	)			(275	)			141				(1,042	)			(538	)
		172,593				156,667				165,741				637,953				1,172,415
Operating loss		(11,273	)			(16,139	)			(28,364	)			(64,792	)			(534,340	)
Interest expense, net		(2,577	)			(2,569	)			(2,637	)			(10,170	)			(13,869	)
Other income (expense), net(2)		(6,289	)			2,137				368				1,628				13,880
Loss before income taxes		(20,139	)			(16,571	)			(30,633	)			(73,334	)			(534,329	)
Income tax benefit		269				3,529				11,886				9,341				65,946
Net loss	$	(19,870	)		$	(13,042	)		$	(18,747	)		$	(63,993	)		$	(468,383	)
Net loss per share:
Basic	$	(0.33	)		$	(0.22	)		$	(0.31	)		$	(1.06	)		$	(7.83	)
Diluted	$	(0.33	)		$	(0.22	)		$	(0.31	)		$	(1.06	)		$	(7.83	)
Weighted average number of common shares outstanding:
Basic		60,380				60,377				59,885				60,293				59,812
Diluted		60,380				60,377				59,885				60,293				59,812

________________

(1)   In the three months and year ended December 31, 2021, cost of revenues (exclusive of depreciation and amortization expense) included non-cash inventory impairment charges of $1.5 million (in service costs) and $3.6 million ($2.1 million in product costs and $1.5 million in service costs), respectively. For the three months and year ended December 31, 2020, cost of revenues (exclusive of depreciation and amortization expense) included non-cash inventory impairment charges of $5.9 million (in product costs) and $31.2 million ($17.9 million in product costs and $13.3 million in service costs), respectively.

(2)   Other income (expense), net in the three months and year ended December 31, 2021 included a non-cash loss of $9.3 million associated with the reclassification of unrealized foreign currency translation adjustments which were released upon the liquidation of an international operation. Additionally, for the year ended December 31, 2021, non-cash gains of $4.0 million were recognized in connection with purchases of $131.4 million principal amount of the 2023 Notes. For the year ended December 31, 2020, non-cash gains of $10.7 million were recognized in connection with the purchases of $34.9 million in principal amount of the 2023 Notes.

OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(In Thousands)

	December 31, 2021				December 31, 2020
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	52,852			$	72,011
Accounts receivable, net		186,080				163,135
Inventories, net		168,573				170,376
Prepaid expenses and other current assets		19,222				18,071
Total current assets		426,727				423,593
Property, plant, and equipment, net		338,583				383,562
Operating lease assets, net		25,388				33,140
Goodwill, net		76,412				76,489
Other intangible assets, net		185,749				205,749
Other noncurrent assets		32,889				29,727
Total assets	$	1,085,748			$	1,152,260
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$	18,262			$	17,778
Accounts payable		63,343				46,433
Accrued liabilities		43,401				44,504
Current operating lease liabilities		6,481				7,620
Income taxes payable		2,564				2,413
Deferred revenue		43,236				43,384
Total current liabilities		177,287				162,132
Long-term debt		160,488				165,759
Long-term operating lease liabilities		23,452				29,166
Deferred income taxes		3,637				14,263
Other noncurrent liabilities		25,058				23,309
Total liabilities		389,922				394,629
Stockholders' equity:
Common stock		739				733
Additional paid-in capital		1,105,135				1,122,945
Retained earnings		281,567				329,327
Accumulated other comprehensive loss		(66,031	)			(71,385	)
Treasury stock		(625,584	)			(623,989	)
Total stockholders' equity		695,826				757,631
Total liabilities and stockholders' equity	$	1,085,748			$	1,152,260

OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)

	Year Ended December 31,
		2021				2020
	(Unaudited)
Cash flows from operating activities:
Net loss	$	(63,993	)		$	(468,383	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization expense		80,741				98,543
Impairments of goodwill		—				406,056
Impairments of inventories		3,581				31,151
Impairments of fixed and lease assets		4,166				12,447
Stock-based compensation expense		7,879				8,431
Amortization of debt discount and deferred financing costs		2,314				7,736
Deferred income tax benefit		(8,639	)			(24,404	)
Release of foreign currency translation adjustments on liquidation of an international operation		9,320				—
Gains on extinguishment of 1.50% convertible senior notes		(4,022	)			(10,721	)
Gains on disposals of assets		(6,472	)			(2,444	)
Other, net		(511	)			4,668
Changes in operating assets and liabilities:
Accounts receivable		(24,407	)			63,876
Inventories		(10,334	)			17,578
Accounts payable and accrued liabilities		17,727				(37,315	)
Deferred revenue		(148	)			25,549
Other operating assets and liabilities, net		(8	)			(13	)
Net cash flows provided by operating activities		7,194				132,755
Cash flows from investing activities:
Capital expenditures		(17,517	)			(12,749	)
Proceeds from disposition of property and equipment		11,527				9,601
Other, net		(636	)			(581	)
Net cash flows used in investing activities		(6,626	)			(3,729	)
Cash flows from financing activities:
Revolving credit facility borrowings		12,873				72,173
Revolving credit facility repayments		(31,873	)			(105,104	)
Issuance of 4.75% convertible senior notes		135,000				—
Purchases of 1.50% convertible senior notes		(125,952	)			(20,078	)
Other debt and finance lease repayments, net		(230	)			(8,222	)
Payment of financing costs		(7,791	)			(1,041	)
Shares added to treasury stock as a result of net share settlements due to vesting of stock awards		(1,595	)			(2,745	)
Net cash flows used in financing activities		(19,568	)			(65,017	)
Effect of exchange rate changes on cash and cash equivalents		(159	)			(491	)
Net change in cash and cash equivalents		(19,159	)			63,518
Cash and cash equivalents, beginning of period		72,011				8,493
Cash and cash equivalents, end of period	$	52,852			$	72,011
Cash paid (received) for:
Interest	$	6,532			$	6,402
Income taxes, net		152				(36,766	)

OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

SEGMENT DATA
(In Thousands)
(unaudited)

	Three Months Ended												Year Ended
	December 31, 2021(2)				September 30, 2021(3)				December 31, 2020(4)				December 31, 2021(5)				December 31, 2020(6)
Revenues:
Offshore/Manufactured Products(1):
Project-driven products	$	43,603			$	25,294			$	36,340			$	122,097			$	165,497
Short-cycle products		18,212				18,682				6,808				65,174				48,142
Other products and services		30,394				25,027				32,370				111,458				126,661
Total Offshore/Manufactured Products		92,209				69,003				75,518				298,729				340,300
Downhole Technologies		25,775				25,527				23,193				103,492				97,936
Well Site Services		43,336				45,998				38,666				170,940				199,839
Total revenues	$	161,320			$	140,528			$	137,377			$	573,161			$	638,075
Operating income (loss):
Offshore/Manufactured Products	$	7,802			$	1,764			$	1,408			$	15,447			$	(80,794	)
Downhole Technologies		(4,525	)			(5,035	)			(8,019	)			(13,470	)			(224,414	)
Well Site Services		(7,818	)			(5,250	)			(11,642	)			(34,511	)			(193,388	)
Corporate		(6,732	)			(7,618	)			(10,111	)			(32,258	)			(35,744	)
Total operating loss	$	(11,273	)		$	(16,139	)		$	(28,364	)		$	(64,792	)		$	(534,340	)

________________

(1)   Disaggregated revenue data is provided to supplement the Segment Data.

(2)   Operating income (loss) for the three months ended December 31, 2021 included $0.3 million of severance and restructuring charges related to the Offshore/Manufactured Products segment. In the Downhole Technologies segment, operating income (loss) included severance and restructuring charges of $0.2 million. In the Well Site Services segment, operating income (loss) included non-cash inventory and fixed asset impairment charges of $1.5 million and $0.7 million, respectively, and severance and restructuring charges of $0.3 million.

(3)   Operating income (loss) for the three months ended September 30, 2021 included $0.3 million of severance and restructuring charges related to the Offshore/Manufactured Products segment. In the Downhole Technologies segment, operating income (loss) included a non-cash inventory impairment charge of $2.1 million and severance and restructuring charges of $0.1 million. In the Well Site Services segment, operating income (loss) included severance and restructuring charges of $0.4 million.

(4)   Operating income (loss) for the three months ended December 31, 2020 included $0.6 million of severance and restructuring charges in the Offshore/Manufactured Products segment. In the Downhole Technologies segment, operating income (loss) included non-cash fixed and lease asset impairment charges of $3.6 million and severance and restructuring charges of $0.7 million. In the Well Site Services segment, operating income (loss) included a non-cash fixed asset impairment charge of $0.7 million and severance and restructuring charges of $0.2 million. In Corporate, operating income (loss) included $1.2 million of severance charges.

(5)   Operating income (loss) for the year ended December 31, 2021 included $0.9 million of severance and restructuring charges related to the Offshore/Manufactured Products segment. In the Downhole Technologies segment, operating income (loss) included a non-cash inventory impairment charge of $2.1 million and severance and restructuring charges of $0.8 million. In the Well Site Services segment, operating income (loss) included non-cash fixed asset and operating lease impairment charges of $4.2 million, a non-cash inventory impairment charge of $1.5 million and severance and restructuring charges of $4.3 million. In Corporate, operating income (loss) included $1.6 million of severance charges.

(6)   Operating income (loss) for the year ended December 31, 2020 included a non-cash goodwill impairment charge of $86.5 million, a non-cash inventory impairment charge of $16.2 million and $1.4 million of severance and restructuring charges related to the Offshore/Manufactured Products segment. In the Downhole Technologies segment, operating income (loss) included a non-cash goodwill impairment charge of $192.5 million, a non-cash inventory impairment charge of $5.9 million, non-cash fixed asset and lease impairment charges of $3.6 million and $2.0 million of severance and restructuring charges. In the Well Site Services segment, operating income (loss) included a non-cash goodwill impairment charge of $127.1 million, a non-cash inventory impairment charge of $9.0 million, non-cash fixed asset impairment charges of $8.8 million and $4.3 million of severance and restructuring charges. In Corporate, operating income (loss) included $1.4 million of severance charges.

OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
SEGMENT EBITDA AND ADJUSTED SEGMENT EBITDA (B)
(In Thousands)
(unaudited)

	Three Months Ended												Year Ended
	December 31, 2021				September 30, 2021				December 31, 2020				December 31 2021				December 31, 2020
Offshore/Manufactured Products:
Operating income (loss)	$	7,802			$	1,764			$	1,408			$	15,447			$	(80,794	)
Other income, net		21				881				82				770				542
Depreciation and amortization expense		5,502				5,662				5,376				22,190				21,881
Impairment of goodwill		—				—				—				—				86,500
Impairment of inventories		—				—				—				—				16,249
Segment EBITDA		13,325				8,307				6,866				38,407				44,378
Severance and restructuring charges		330				256				633				868				1,355
Adjusted Segment EBITDA	$	13,655			$	8,563			$	7,499			$	39,275			$	45,733
Downhole Technologies:
Operating loss	$	(4,525	)		$	(5,035	)		$	(8,019	)		$	(13,470	)		$	(224,414	)
Other income (expense), net		—				(4	)			16				(6	)			(81	)
Depreciation and amortization expense		4,455				4,226				5,745				17,591				22,649
Impairment of goodwill		—				—				—				—				192,502
Impairment of inventories		—				2,113				—				2,113				5,921
Impairment of fixed and lease assets		—				—				3,602				—				3,602
Segment EBITDA		(70	)			1,300				1,344				6,228				179
Severance and restructuring charges		202				129				703				809				2,018
Adjusted Segment EBITDA	$	132			$	1,429			$	2,047			$	7,037			$	2,197
Well Site Services:
Operating loss	$	(7,818	)		$	(5,250	)		$	(11,642	)		$	(34,511	)		$	(193,388	)
Other income		3,010				1,260				270				6,162				2,698
Depreciation and amortization expense		8,511				9,531				11,906				40,152				53,240
Impairment of goodwill		—				—				—				—				127,054
Impairments of inventories		1,468				—				—				1,468				8,981
Impairments of fixed and lease assets		722				—				655				4,166				8,845
Segment EBITDA		5,893				5,541				1,189				17,437				7,430
Severance and restructuring charges		257				352				219				4,266				4,311
Adjusted Segment EBITDA	$	6,150			$	5,893			$	1,408			$	21,703			$	11,741
Corporate:
Operating loss	$	(6,732	)		$	(7,618	)		$	(10,111	)		$	(32,258	)		$	(35,744	)
Other income (expense)		(9,320	)			—				—				(5,298	)			10,721
Depreciation and amortization expense		187				238				210				808				773
Release of foreign currency translation adjustments on liquidation of an international operation		9,320				—				—				9,320				—
Gains on extinguishment of debt		—				—				—				(4,022	)			(10,721	)
EBITDA		(6,545	)			(7,380	)			(9,901	)			(31,450	)			(34,971	)
Severance charges		—				—				1,169				1,555				1,385
Adjusted EBITDA	$	(6,545	)		$	(7,380	)		$	(8,732	)		$	(29,895	)		$	(33,586	)

OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
CONSOLIDATED EBITDA AND ADJUSTED CONSOLIDATED EBITDA (A)
(In Thousands)
(unaudited)

	Three Months Ended												Year Ended
	December 31, 2021				September 30, 2021				December 31, 2020				December 31, 2021				December 31, 2020
Net loss	$	(19,870	)		$	(13,042	)		$	(18,747	)		$	(63,993	)		$	(468,383	)
Interest expense, net		2,577				2,569				2,637				10,170				13,869
Income tax benefit		(269	)			(3,529	)			(11,886	)			(9,341	)			(65,946	)
Depreciation and amortization expense		18,655				19,657				23,237				80,741				98,543
Impairments of goodwill		—				—				—				—				406,056
Impairments of inventories		1,468				2,113				—				3,581				31,151
Impairments of fixed and lease assets		722				—				4,257				4,166				12,447
Release of foreign currency translation adjustments on liquidation of an international operation		9,320				—				—				9,320				—
Gains on extinguishment of 1.50% convertible senior notes		—				—				—				(4,022	)			(10,721	)
Consolidated EBITDA		12,603				7,768				(502	)			30,622				17,016
Severance and restructuring charges		789				737				2,724				7,498				9,069
Adjusted Consolidated EBITDA	$	13,392			$	8,505			$	2,222			$	38,120			$	26,085

________________

(A)   The terms Consolidated EBITDA and Adjusted Consolidated EBITDA consist of net loss plus net interest expense, taxes, depreciation and amortization expense, non-cash asset impairment charges and a non-cash loss associated with the reclassification of unrealized foreign currency translation adjustments which were released upon the liquidation of an international operation, less gains on extinguishment of 1.50% convertible senior notes (the "2023 Notes") and adjustments for certain other items. Consolidated EBITDA and Adjusted Consolidated EBITDA are not measures of financial performance under generally accepted accounting principles and should not be considered in isolation from or as a substitute for net loss or cash flow measures prepared in accordance with generally accepted accounting principles or as measures of profitability or liquidity. Additionally, Consolidated EBITDA and Adjusted Consolidated EBITDA may not be comparable to other similarly titled measures of other companies. The Company has included Consolidated EBITDA and Adjusted Consolidated EBITDA as supplemental disclosures because its management believes that Consolidated EBITDA and Adjusted Consolidated EBITDA provide useful information regarding its ability to service debt and to fund capital expenditures and provides investors a helpful measure for comparing its operating performance with the performance of other companies that have different financing and capital structures or tax rates. The Company uses Consolidated EBITDA and Adjusted Consolidated EBITDA to compare and to monitor the performance of the Company and its business segments to other comparable public companies and as a benchmark for the award of incentive compensation under its annual incentive compensation plan. The table above sets forth reconciliations of Consolidated EBITDA and Adjusted Consolidated EBITDA to net loss, which is the most directly comparable measure of financial performance calculated under generally accepted accounting principles.

(B)   The terms EBITDA, Adjusted EBITDA, Segment EBITDA and Adjusted Segment EBITDA consist of operating income (loss) plus other income (expense), depreciation and amortization expense, non-cash asset impairment charges and a non-cash loss associated with the reclassification of unrealized foreign currency translation adjustments which were released upon the liquidation of an international operation, less gains on extinguishment of the 2023 Notes and adjustments for certain other items. EBITDA, Adjusted EBITDA, Segment EBITDA and Adjusted Segment EBITDA are not measures of financial performance under generally accepted accounting principles and should not be considered in isolation from or as a substitute for operating income (loss) or cash flow measures prepared in accordance with generally accepted accounting principles or as a measure of profitability or liquidity. Additionally, EBITDA, Adjusted EBITDA, Segment EBITDA and Adjusted Segment EBITDA may not be comparable to other similarly titled measures of other companies. The Company has included EBITDA, Adjusted EBITDA, Segment EBITDA and Adjusted Segment EBITDA as supplemental disclosures because its management believes that EBITDA, Adjusted EBITDA, Segment EBITDA and Adjusted Segment EBITDA provide useful information regarding its ability to service debt and to fund capital expenditures and provides investors a helpful measure for comparing its operating performance with the performance of other companies that have different financing and capital structures or tax rates. The Company uses EBITDA, Adjusted EBITDA, Segment EBITDA and Adjusted Segment EBITDA to compare and to monitor the performance of its business segments to other comparable public companies and as a benchmark for the award of incentive compensation under its annual incentive compensation plan. The tables above set forth reconciliations of EBITDA, Adjusted EBITDA, Segment EBITDA and Adjusted Segment EBITDA to operating income (loss), which is the most directly comparable measure of financial performance calculated under generally accepted accounting principles.

Company Contact:

Lloyd A. Hajdik
Oil States International, Inc.
Executive Vice President, Chief Financial Officer and Treasurer
713-652-0582
SOURCE: Oil States International, Inc.

FAQ

What was Oil States International's net loss for Q4 2021?

Oil States International reported a net loss of $19.9 million for Q4 2021.

How much did Oil States International earn in revenue for Q4 2021?

Oil States International generated revenues of $161.3 million in Q4 2021.

What is the book-to-bill ratio for Oil States International in Q4 2021?

The book-to-bill ratio for Oil States International in Q4 2021 was 1.1x.

What factors contributed to Oil States International's net loss in Q4 2021?

The net loss included non-cash impairment charges and a foreign currency translation loss.

How did Oil States International's Adjusted EBITDA change in Q4 2021?

Adjusted EBITDA increased 57% to $13.4 million in Q4 2021.