TETRA TECHNOLOGIES, INC. ANNOUNCES FOURTH QUARTER AND TOTAL YEAR 2024 RESULTS AND PROVIDES FIRST-HALF 2025 GUIDANCE
TETRA Technologies (NYSE:TTI) reported Q4 2024 results with GAAP income from continuing operations of $102 million ($0.77 per share), including a $97.5 million tax benefit. Q4 revenue was $134.5 million, down 5% sequentially, with Adjusted EBITDA of $22.8 million.
Key highlights include:
- Adjusted income from continuing operations of $3.9 million ($0.03 per share)
- Net cash from operations of $5.6 million
- Record high water treatment and recycling volumes
- Monetization of Kodiak Gas Services investment for $19 million
The company provided guidance for H1 2025, expecting net income before taxes of $19-34 million and adjusted EBITDA of $55-65 million. For full-year 2025, TETRA anticipates high single-digit to low double-digit revenue growth and over $50 million in free cash flow from base business. The company maintains strong liquidity of $207 million as of February 25, with net debt of $143 million.
TETRA Technologies (NYSE:TTI) ha riportato i risultati del Q4 2024 con un reddito GAAP dalle operazioni continuative di 102 milioni di dollari (0,77 dollari per azione), inclusi 97,5 milioni di dollari di benefici fiscali. Le entrate del Q4 sono state di 134,5 milioni di dollari, in calo del 5% rispetto al trimestre precedente, con un EBITDA rettificato di 22,8 milioni di dollari.
Tra i punti salienti ci sono:
- Reddito rettificato dalle operazioni continuative di 3,9 milioni di dollari (0,03 dollari per azione)
- Flusso di cassa netto dalle operazioni di 5,6 milioni di dollari
- Volume record nel trattamento e nel riciclaggio dell'acqua
- Monetizzazione dell'investimento in Kodiak Gas Services per 19 milioni di dollari
La società ha fornito previsioni per il primo semestre del 2025, prevedendo un reddito netto prima delle tasse di 19-34 milioni di dollari e un EBITDA rettificato di 55-65 milioni di dollari. Per l'intero anno 2025, TETRA prevede una crescita delle entrate da un singolo cifra alta a una doppia cifra bassa e oltre 50 milioni di dollari di flusso di cassa libero dal business di base. L'azienda mantiene una forte liquidità di 207 milioni di dollari al 25 febbraio, con un debito netto di 143 milioni di dollari.
TETRA Technologies (NYSE:TTI) informó los resultados del cuarto trimestre de 2024 con un ingreso GAAP de operaciones continuas de 102 millones de dólares (0,77 dólares por acción), incluyendo un beneficio fiscal de 97,5 millones de dólares. Los ingresos del cuarto trimestre fueron de 134,5 millones de dólares, una disminución del 5% en comparación con el trimestre anterior, con un EBITDA ajustado de 22,8 millones de dólares.
Los aspectos más destacados incluyen:
- Ingreso ajustado de operaciones continuas de 3,9 millones de dólares (0,03 dólares por acción)
- Flujo de efectivo neto de operaciones de 5,6 millones de dólares
- Volúmenes récord en tratamiento y reciclaje de agua
- Monetización de la inversión en Kodiak Gas Services por 19 millones de dólares
La empresa proporcionó orientación para la primera mitad de 2025, esperando un ingreso neto antes de impuestos de 19-34 millones de dólares y un EBITDA ajustado de 55-65 millones de dólares. Para todo el año 2025, TETRA anticipa un crecimiento de ingresos de un solo dígito alto a un bajo de dos dígitos y más de 50 millones de dólares en flujo de efectivo libre del negocio base. La empresa mantiene una sólida liquidez de 207 millones de dólares al 25 de febrero, con una deuda neta de 143 millones de dólares.
TETRA Technologies (NYSE:TTI)는 2024년 4분기 결과를 보고하며 계속 운영에서 GAAP 수익이 1억 200만 달러(주당 0.77달러)로, 9,750만 달러의 세금 혜택이 포함되었습니다. 4분기 수익은 1억 3,450만 달러로, 전분기 대비 5% 감소했으며, 조정 EBITDA는 2,280만 달러였습니다.
주요 하이라이트는 다음과 같습니다:
- 계속 운영에서 조정된 수익 390만 달러(주당 0.03달러)
- 운영에서의 순 현금 560만 달러
- 수처리 및 재활용량의 기록적인 증가
- Kodiak Gas Services 투자로 1,900만 달러의 수익 실현
회사는 2025년 상반기 전망을 제공하며 세전 순이익이 1,900만에서 3,400만 달러, 조정 EBITDA가 5,500만에서 6,500만 달러에 이를 것으로 예상하고 있습니다. 2025년 전체 연도에 대해 TETRA는 높은 단일 자릿수에서 낮은 두 자릿수의 수익 성장을 예상하며, 기본 사업에서 5,000만 달러 이상의 자유 현금을 예상하고 있습니다. 회사는 2월 25일 기준으로 2억 700만 달러의 강력한 유동성을 유지하고 있으며, 순 부채는 1억 4,300만 달러입니다.
TETRA Technologies (NYSE:TTI) a publié ses résultats du quatrième trimestre 2024 avec un revenu GAAP des opérations continues de 102 millions de dollars (0,77 dollar par action), incluant un avantage fiscal de 97,5 millions de dollars. Les revenus du quatrième trimestre s'élevaient à 134,5 millions de dollars, en baisse de 5 % par rapport au trimestre précédent, avec un EBITDA ajusté de 22,8 millions de dollars.
Les points clés comprennent :
- Revenu ajusté des opérations continues de 3,9 millions de dollars (0,03 dollar par action)
- Flux de trésorerie net des opérations de 5,6 millions de dollars
- Volumes record dans le traitement et le recyclage de l'eau
- Monétisation de l'investissement dans Kodiak Gas Services pour 19 millions de dollars
L'entreprise a fourni des prévisions pour le premier semestre 2025, s'attendant à un revenu net avant impôts de 19 à 34 millions de dollars et un EBITDA ajusté de 55 à 65 millions de dollars. Pour l'année complète 2025, TETRA prévoit une croissance des revenus à un chiffre élevé à un chiffre double bas et plus de 50 millions de dollars de flux de trésorerie libre provenant de l'activité principale. L'entreprise maintient une solide liquidité de 207 millions de dollars au 25 février, avec une dette nette de 143 millions de dollars.
TETRA Technologies (NYSE:TTI) berichtete über die Ergebnisse des 4. Quartals 2024 mit einem GAAP-Einkommen aus fortgeführten Betrieben von 102 Millionen Dollar (0,77 Dollar pro Aktie), einschließlich eines Steuerbenefits von 97,5 Millionen Dollar. Der Umsatz im 4. Quartal betrug 134,5 Millionen Dollar, was einem Rückgang von 5 % im Vergleich zum vorherigen Quartal entspricht, mit einem bereinigten EBITDA von 22,8 Millionen Dollar.
Wichtige Highlights sind:
- Bereinigtes Einkommen aus fortgeführten Betrieben von 3,9 Millionen Dollar (0,03 Dollar pro Aktie)
- Netto-Cashflow aus dem operativen Geschäft von 5,6 Millionen Dollar
- Rekordhohe Mengen an Wasserbehandlung und -recycling
- Monetarisierung der Investition in Kodiak Gas Services für 19 Millionen Dollar
Das Unternehmen gab eine Prognose für das erste Halbjahr 2025 ab und erwartet ein Netto-Einkommen vor Steuern von 19-34 Millionen Dollar und ein bereinigtes EBITDA von 55-65 Millionen Dollar. Für das gesamte Jahr 2025 erwartet TETRA ein hohes Wachstum im einstelligen Bereich bis hin zu einem niedrigen zweistelligen Bereich und über 50 Millionen Dollar an freiem Cashflow aus dem Kerngeschäft. Das Unternehmen verfügt am 25. Februar über eine starke Liquidität von 207 Millionen Dollar bei einer Nettoverschuldung von 143 Millionen Dollar.
- Record high water treatment and recycling volumes in Q4
- Successful monetization of Kodiak investment for $19M
- Strong H1 2025 guidance with projected record EBITDA
- $345M tax loss carryforward providing future tax benefits
- Improved EBITDA margins to 17.0% from 16.6% in Q3
- Q4 revenue declined 5% sequentially to $134.5M
- Negative adjusted free cash flow of $9.3M in Q4
- Water & Flowback Services revenue down 14% QoQ
- Net debt position of $143M
Insights
TETRA Technologies' Q4 results reveal a company successfully navigating market challenges while positioning for significant growth in 2025. The headline $97.5 million tax valuation allowance release represents a pivotal milestone, as it signals management's high confidence in sustainable future profitability based on three consecutive years of positive U.S. pretax income. This accounting adjustment isn't merely technical - it reflects TETRA's transformation into a consistently profitable enterprise with meaningful tax advantages.
Despite a 5% sequential revenue decline to
TETRA's strategic positioning aligns with major industry trends: (1) increasing deepwater activity in the Gulf of Mexico and Brazil, (2) growing demand for produced water treatment solutions amid disposal restrictions in the Permian Basin, and (3) emerging opportunities in energy transition through battery materials. The commercial launch of TETRA Oasis TDS for produced water desalination addresses a critical industry challenge and could establish a new recurring revenue stream if the technology proves commercially viable at scale.
The
TETRA's Q4 results reveal a company successfully executing a multi-pronged strategy that balances traditional energy services with emerging opportunities in water management and energy transition. The successful commercial pilot of their produced water desalination technology represents a potential game-changer for the industry. By demonstrating compliance with both Texas Railroad Commission standards and passing Whole Effluent Toxicity testing, TETRA has cleared critical regulatory hurdles that have traditionally beneficial reuse applications. This positions them advantageously as disposal well capacity constraints in the Permian Basin force operators to seek alternative produced water solutions.
The company's
TETRA's strategic pivot on their Arkansas bromine project demonstrates capital discipline and operational flexibility. By pursuing bridging supply agreements before committing to full-scale production, management is effectively de-risking the development timeline while still maintaining their strategic positioning in specialty chemicals and battery materials. This approach allows them to accumulate additional cash from their base business while potentially reducing overall capital requirements.
The
Looking ahead, TETRA's projected
Fourth Quarter Financial Highlights
- Fourth quarter GAAP income from continuing operations was
and GAAP diluted earnings per share from continuing operations was$102 million , inclusive of a non-cash$0.77 favorable valuation allowance adjustment to deferred tax assets in$97.5 million the United States . - Excluding unusual and non-recurring credits and expenses, adjusted income from continuing operations was
, a$3.9 million 16% sequential improvement. Adjusted diluted net income per share from continuing operations was . Fourth quarter Adjusted EBITDA was$0.03 .$22.8 million - Fourth quarter revenue of
decreased$134.5 million 5% sequentially. - Fourth quarter net cash provided by operating activities was
while adjusted free cash flow was a use of$5.6 million .$9.3 million
Brady
In the past week we finished the completion work for the first of three TETRA CS Neptune wells that are scheduled for the first half of the year. When combining the TETRA CS Neptune three well project, the start of deepwater offshore projects in
In the fourth quarter we recognized a favorable adjustment of
Certain assumptions underlying the valuation of our deferred tax assets are set forth in the Cautionary Statement Regarding Forward-Looking Statements.
Fourth Quarter Results
Fourth quarter 2024 revenue of
Fourth quarter Adjusted EBITDA of
Fourth quarter cash flow from operating activities was
Brady
Water & Flowback Services revenue for the fourth quarter was
Completion Fluids & Products fourth-quarter 2024 revenue of
Strategic Initiatives Update
Brady
We are prioritizing our strategic initiatives on projects that can immediately impact our near-term results, with a focus on TETRA CS Neptune fluids in the Gulf of America, TETRA PureFlow Plus electrolyte shipments to Eos Energy Enterprises, and further advancing our water desalination commercial pilot units that are expected to subsequently transition into long duration contracts for commercial desalination plants. Long term we believe that lithium prices will rebound to levels that support increased investment in supply, especially from the
This press release includes the following financial measures that are not presented in accordance with generally accepted accounting principles in
(1) Base business adjusted free cash flow is defined as total adjusted free cash flow prior to TETRA's investments in the
A summary of key financial metrics for the fourth quarter are as follows:
Fourth Quarter 2024 Results | |||||
Three Months Ended | |||||
December 31, | September 30, | December 31, | |||
(in thousands, except per share amounts) | |||||
Revenue | $ 134,504 | $ 141,700 | $ 153,126 | ||
Income (loss) from continuing operations | 102,233 | 2,832 | (4,239) | ||
Adjusted EBITDA before discontinued operations | 22,825 | 23,501 | 24,142 | ||
GAAP diluted income earnings (loss) per share from continuing operations | 0.77 | 0.02 | (0.03) | ||
Adjusted income from continuing operations | 0.03 | 0.03 | 0.03 | ||
Net cash provided by operating activities | 5,635 | 19,870 | 18,875 | ||
Total adjusted free cash flow(1) | $ (9,324) | $ 6,331 | $ 20,073 |
(1) | For the three months ended December 31, 2024, September 30, 2024 and December 31, 2023, total adjusted free cash flow includes |
At the end of the fourth quarter, unrestricted cash was
Fourth Quarter Non-Recurring Charges and Expenses
Fourth quarter 2024 non-recurring credits, charges and expenses are reflected on Schedule E and include a favorable adjustment of
Total Year Results
Total year revenue of
A summary of key financial metrics for the total year are as follows:
Twelve Months Ended | |||||||
December 31, | December 31, | Change | % Change | ||||
(In Millions) | |||||||
Revenue | $ 599.1 | $ 626.3 | $ (27.2) | (4) % | |||
Operating income from continuing operations | $ 28.7 | $ 31.7 | $ (3.0) | (9) % | |||
% of revenue | 4.8 % | 5.1 % | (0.3) % | ||||
Adjusted EBITDA | $ 99.4 | $ 106.8 | $ (7.4) | (7) % | |||
Adjusted EBITDA margin | 16.6 % | 17.1 % | (0.5) % | ||||
Cash flow from operations | $ 36.5 | $ 70.2 | $ (33.7) | (48) % | |||
Adjusted free cash flow | $ (23.2) | $ 40.8 | $ (64.0) | NM(1) | |||
Net debt | $ 142.7 | $ 105.0 | $ 37.7 | 36 % |
(1) Percent change is not meaningful |
Completion Fluids & Products total year revenue for 2024 of
Water & Flowback Services total year revenue for 2024 of
Total Year Non-Recurring Charges and Expenses
Total year non-recurring credits, net of charges and expenses were
Conference Call
TETRA will host a conference call to discuss these results on February 26, 2025, at 10:30 a.m. Eastern Time. The phone number for the call is 1-800-836-8184. The conference call will also be available by live audio webcast. A replay of the conference call will be available at 1-888-660-6345 conference number 37885#, for one week following the conference call and the archived webcast will be available through the Company's website for thirty days following the conference call.
Investor Contact
For further information, please contact Elijio Serrano, CFO, TETRA Technologies, Inc. at (281) 367-1983 or via email at eserrano@onetetra.com.
Financial Statements, Schedules and Non-GAAP Reconciliation Schedules (Unaudited)
Schedule A: Consolidated Income Statement
Schedule B: Condensed Consolidated Balance Sheet
Schedule C: Consolidated Statements of Cash Flows
Schedule D: Statement Regarding Use of Non-GAAP Financial Measures
Schedule E: Non-GAAP Reconciliation of Adjusted Net Income (Loss) From Continuing Operations
Schedule F: Non-GAAP Reconciliation of Adjusted EBITDA
Schedule G: Non-GAAP Reconciliation of Net Debt
Schedule H: Non-GAAP Reconciliation to Total Adjusted Free Cash Flow and
Base Business Adjusted Free Cash Flow
Schedule I: Non-GAAP Reconciliation to Net Leverage Ratio
Schedule J: Non-GAAP Reconciliation to Return on Net Capital Employed
Schedule K: Non-GAAP Reconciliation of Adjusted EBITDA for Projected First Half 2025 and Actual First Half 2024
Company Overview
TETRA Technologies, Inc. is an energy services and solutions company focused on developing environmentally conscious services and solutions that help make people's lives better. With operations on six continents, the Company's portfolio consists of Energy Services, Industrial Chemicals, and Lithium Ventures. In addition to providing products and services to the oil and gas industry and calcium chloride for diverse applications, TETRA is expanding into the low-carbon energy market with chemistry expertise, key mineral acreage, and global infrastructure, helping to meet the demand for sustainable energy in the twenty-first century. Visit the Company's website at www.onetetra.com for more information.
Cautionary Statement Regarding Forward Looking Statements
This news release includes certain statements that are deemed to be forward-looking statements. Generally, the use of words such as "may," "see," "expectation," "expect," "intend," "estimate," "projects," "anticipate," "believe," "assume," "could," "should," "plans," "targets" or similar expressions that convey the uncertainty of future events, activities, expectations or outcomes identify forward-looking statements that the Company intends to be included within the safe harbor protections provided by the federal securities laws. These forward-looking statements include statements concerning economic and operating conditions that are outside of our control, including statements concerning current trends in the oil and gas industry; potential revenue associated with prospective energy storage projects; measured, indicated and inferred mineral resources of lithium and/or bromine, the potential extraction of lithium and bromine from our Evergreen Unit and other leased acreage, the economic viability thereof, the demand for such resources, the timing and costs of such activities, and the expected production, profits and returns from such activities; the accuracy of our resources report, feasibility study and economic assessment regarding our lithium and bromine acreage; projections or forecasts concerning the Company's business activities, profitability, estimated future financial results, earnings per share, and statements regarding the Company's beliefs, expectations, plans, goals, future events and performance, and other statements that are not purely historical. With respect to the Company's disclosures of measured, indicated and inferred mineral resources, including bromine and lithium carbonate equivalent concentrations, it is uncertain if all such resources will ever be economically developed. Investors are cautioned that mineral resources do not have demonstrated economic value and further exploration may not result in the estimation of a mineral reserve. Further, there are a number of uncertainties related to processing lithium, which is an inherently difficult process. Therefore, you are cautioned not to assume that all or any part of our resources can be economically or legally commercialized.
The discussions regarding the loss carryforwards and pretax income associated with the valuation of the deferred tax assets, including our NOLs, assume that activity from deepwater Gulf of America and
These forward-looking statements are based on certain assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Such statements are subject to several risks and uncertainties, many of which are beyond the control of the Company. With respect to the Company's disclosures regarding the potential joint venture for the Evergreen Unit, it is uncertain about the ability of the parties to successfully negotiate one or more definitive agreements, the future relationship between the parties, and the ability to successfully and economically produce lithium and bromine from the Evergreen Unit. Investors are cautioned that any such statements are not guarantees of future performance or results and that actual results or developments may differ materially from those projected in the forward-looking statements. Some of the factors that could affect actual results are described in the section titled "Risk Factors" contained in the Company's Annual Reports on Form 10-K, as well as other risks identified from time to time in its reports on Form 10-Q and Form 8-K filed with the Securities and Exchange Commission. Investors should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement, and the Company undertakes no obligation to update or revise any forward-looking statements, except as may be required by law.
Schedule A: Consolidated Income Statement (Unaudited)
| |||||||||
Three Months Ended | Twelve Months Ended | ||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | |||||
(in thousands, except per share amounts) | |||||||||
Revenues | $ 134,504 | $ 141,700 | $ 153,126 | $ 599,111 | $ 626,262 | ||||
Cost of product sales and services | 94,015 | 98,391 | 112,070 | 423,428 | 438,172 | ||||
Depreciation, amortization, and accretion | 9,354 | 8,837 | 8,624 | 35,721 | 34,329 | ||||
Impairments and other charges | — | 109 | 2,189 | 109 | 2,966 | ||||
Insurance recoveries | — | — | — | — | (2,850) | ||||
Total cost of revenues | 103,369 | 107,337 | 122,883 | 459,258 | 472,617 | ||||
Gross profit | 31,135 | 34,363 | 30,243 | 139,853 | 153,645 | ||||
Exploration and pre-development costs | — | — | 5,283 | — | 12,119 | ||||
General and administrative expense | 23,128 | 22,406 | 23,336 | 89,969 | 96,590 | ||||
Interest expense, net | 5,232 | 5,096 | 5,677 | 22,465 | 22,349 | ||||
Loss on debt extinguishment | — | — | — | 5,535 | — | ||||
Other income, net | (4,617) | (715) | (422) | (6,858) | (9,112) | ||||
Income (loss) before taxes and discontinued operations | 7,392 | 7,576 | (3,631) | 28,742 | 31,699 | ||||
Provision (benefit) for income taxes | (94,841) | 4,744 | 608 | (84,878) | 6,220 | ||||
Income (loss) from continuing operations | 102,233 | 2,832 | (4,239) | 113,620 | 25,479 | ||||
Income (loss) from discontinued operations, net of taxes | 490 | (5,830) | 346 | (5,340) | 278 | ||||
Net income (loss) | 102,723 | (2,998) | (3,893) | 108,280 | 25,757 | ||||
Loss attributable to noncontrolling interest | 1 | — | 2 | 4 | 27 | ||||
Net income (loss) attributable to TETRA stockholders | $ 102,724 | $ (2,998) | $ (3,891) | $ 108,284 | $ 25,784 | ||||
Basic net income (loss) per common share: | |||||||||
Income (loss) from continuing operations | $ 0.78 | $ 0.02 | $ (0.03) | $ 0.87 | $ 0.20 | ||||
Loss from discontinued operations | 0.00 | (0.04) | 0.00 | (0.04) | 0.00 | ||||
Net income (loss) attributable to TETRA stockholders | $ 0.78 | $ (0.02) | $ (0.03) | $ 0.83 | $ 0.20 | ||||
Weighted average basic shares outstanding | 131,809 | 131,579 | 130,079 | 131,279 | 129,568 | ||||
Diluted net income (loss) per common share: | |||||||||
Income (loss) from continuing operations | $ 0.77 | $ 0.02 | $ (0.03) | $ 0.86 | $ 0.20 | ||||
Loss from discontinued operations | 0.00 | (0.04) | 0.00 | (0.04) | 0.00 | ||||
Net income (loss) attributable to TETRA stockholders | $ 0.77 | $ (0.02) | $ (0.03) | $ 0.82 | $ 0.20 | ||||
Weighted average diluted shares outstanding | 132,812 | 132,029 | 130,079 | 132,231 | 131,243 |
Schedule B: Condensed Consolidated Balance Sheet (Unaudited)
| |||
December 31, | December 31, | ||
(in thousands) | |||
ASSETS | |||
Current assets: | |||
Cash and cash equivalents | $ 36,987 | $ 52,485 | |
Restricted cash | 221 | — | |
Trade accounts receivable, net | 104,813 | 111,798 | |
Inventories | 101,697 | 96,536 | |
Prepaid expenses and other current assets | 25,910 | 21,196 | |
Total current assets | 269,628 | 282,015 | |
Plant, property, and equipment, net | 142,160 | 107,716 | |
Deferred tax assets | 98,149 | 910 | |
Operating lease right-of-use assets | 29,797 | 31,915 | |
Investments | 28,159 | 17,354 | |
Patents, trademarks and other intangible assets, net | 24,923 | 29,132 | |
Other assets | 12,379 | 9,919 | |
Total long-term assets | 335,567 | 196,946 | |
Total assets | $ 605,195 | $ 478,961 | |
LIABILITIES AND EQUITY | |||
Current liabilities: | |||
Trade accounts payable | $ 43,103 | $ 52,290 | |
Compensation and employee benefits | 23,022 | 26,918 | |
Operating lease liabilities, current portion | 8,861 | 9,101 | |
Accrued taxes | 12,493 | 10,350 | |
Accrued liabilities and other | 30,040 | 27,303 | |
Current liabilities associated with discontinued operations | 5,830 | — | |
Total current liabilities | 123,349 | 125,962 | |
Long-term debt, net | 179,696 | 157,505 | |
Operating lease liabilities | 25,041 | 27,538 | |
Asset retirement obligations | 14,786 | 14,199 | |
Deferred income taxes | 4,912 | 2,279 | |
Other liabilities | 4,104 | 4,144 | |
Total long-term liabilities | 228,539 | 205,665 | |
TETRA stockholders' equity | 254,568 | 148,591 | |
Noncontrolling interests | (1,261) | (1,257) | |
Total equity | 253,307 | 147,334 | |
Total liabilities and equity | $ 605,195 | $ 478,961 |
Schedule C: Consolidated Statements of Cash Flows (Unaudited)
| |||||||||
Three Months Ended | Twelve Months Ended | ||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | |||||
(in thousands) | |||||||||
Operating activities: | |||||||||
Net income (loss) | $ 102,723 | $ (2,998) | $ (3,893) | $ 108,280 | $ 25,757 | ||||
Reconciliation of net income (loss) to net cash provided by operating activities: | |||||||||
Depreciation, amortization, and accretion | 9,354 | 8,837 | 8,624 | 35,721 | 34,329 | ||||
Impairments and other charges | — | 109 | 2,189 | 109 | 2,966 | ||||
Gain on investments | (5,013) | (750) | (696) | (8,604) | (539) | ||||
Provision (benefit) for deferred taxes | (95,522) | 967 | 71 | (94,455) | (734) | ||||
Equity-based compensation expense | 1,668 | 1,481 | 6,423 | 6,572 | 10,622 | ||||
Provision for credit losses | 254 | 130 | 95 | 217 | 285 | ||||
Loss on debt extinguishment | — | — | — | 5,535 | — | ||||
Amortization and expense of financing costs | 266 | 239 | 726 | 1,389 | 3,433 | ||||
Insurance recoveries associated with damaged equipment | — | — | — | — | (2,850) | ||||
Gain on sale of assets | (196) | (75) | (130) | (338) | (562) | ||||
Other non-cash charges and credits | (316) | 26 | (315) | (1,076) | (1,231) | ||||
Changes in operating assets and liabilities: | |||||||||
Accounts receivable | 2,693 | 26,634 | 12,565 | 5,702 | 20,165 | ||||
Inventories | (6,826) | (13,953) | (3,215) | (8,784) | (23,205) | ||||
Prepaid expenses and other current assets | (5,344) | 1,930 | 863 | (6,574) | 2,176 | ||||
Trade accounts payable and accrued expenses | 1,744 | 606 | (3,021) | (4,140) | (128) | ||||
Other | 150 | (3,313) | (1,411) | (3,034) | (278) | ||||
Net cash provided by operating activities | 5,635 | 19,870 | 18,875 | 36,520 | 70,206 | ||||
Investing activities: | |||||||||
Purchases of property, plant, and equipment | (14,888) | (14,573) | (7,912) | (60,680) | (38,152) | ||||
Purchases of investments | — | (1,021) | — | (1,021) | (350) | ||||
Proceeds from sale of investment | — | — | 3,900 | — | 3,900 | ||||
Proceeds from sale of property, plant, and equipment | 261 | 2,284 | 6,003 | 2,917 | 6,661 | ||||
Proceeds from insurance recoveries associated with damaged equipment | — | — | — | — | 2,850 | ||||
Other investing activities | 12 | (93) | (100) | (275) | (1,936) | ||||
Net cash provided by (used in) investing activities | (14,615) | (13,403) | 1,891 | (59,059) | (27,027) | ||||
Financing activities: | |||||||||
Proceeds from credit agreement and long-term debt | 98 | 109 | 145 | 184,820 | 97,529 | ||||
Principal payments on credit agreement and long-term debt | (98) | (109) | (2,056) | (163,579) | (100,497) | ||||
Payments on finance lease obligations | (384) | (414) | (858) | (1,438) | (1,695) | ||||
Debt issuance costs | (692) | — | — | (6,648) | — | ||||
Shares withheld for taxes on equity-based compensation | (53) | (566) | — | (3,006) | — | ||||
Other financing activities | — | — | — | (1,280) | — | ||||
Net cash provided by (used in) financing activities | (1,129) | (980) | (2,769) | 8,869 | (4,663) | ||||
Effect of exchange rate changes on cash | (1,696) | 774 | 662 | (1,607) | 377 | ||||
Increase (decrease) in cash and cash equivalents and restricted cash | (11,805) | 6,261 | 18,659 | (15,277) | 38,893 | ||||
Cash and cash equivalents at beginning of period | 49,013 | 42,752 | 33,826 | 52,485 | 13,592 | ||||
Cash and cash equivalents and restricted cash at end of period associated with continuing operations | $ 37,208 | $ 49,013 | $ 52,485 | $ 37,208 | $ 52,485 |
Schedule D: Statement Regarding Use of Non-GAAP Financial Measures
In addition to financial results determined in accordance with
Management believes that the exclusion of the special charges and credits from the historical results of operations enables management to evaluate more effectively the Company's operations over the prior periods and to identify operating trends that could be obscured by the excluded items.
Adjusted net income is defined as the Company's income (loss) before noncontrolling interests and discontinued operations, excluding unusual tax provision, unusual foreign exchange losses and certain special or other charges (or credits), and including noncontrolling interest attributable to continued operations. Adjusted net income is used by management as a supplemental financial measure to assess financial performance, without regard to charges or credits that are considered by management to be outside of its normal operations.
Adjusted net income per share is defined as the Company's diluted net income per share attributable to TETRA stockholders excluding certain special or other charges (or credits). Adjusted net income per share is used by management as a supplemental financial measure to assess financial performance, without regard to charges or credits that are considered by management to be outside of its normal operations.
Adjusted EBITDA is defined as net income (loss) before taxes and discontinued operations, excluding impairments, exploration and pre-development costs, certain special, non-recurring or other charges (or credits), including loss on debt extinguishment, interest, depreciation and amortization, income from collaborative arrangement and certain non-cash items such as equity-based compensation expense. The most directly comparable GAAP financial measure is net income (loss) before taxes and discontinued operations. Exploration and pre-development costs represent expenditures incurred to evaluate potential future development of TETRA's lithium and bromine properties in
Total adjusted free cash flow is defined as cash from operations less capital expenditures net of sales proceeds and cost of equipment sold, less payments on financing lease obligations and including cash distributions to TETRA from investments and cash from sales of investments. Base business adjusted free cash flow is defined as Total adjusted free cash flow excluding TETRA's investments in the
- assess the Company's ability to retire debt;
- evaluate the capacity of the Company to further invest and grow; and
- to measure the performance of the Company as compared to its peer group.
Total adjusted free cash flow does not necessarily imply residual cash flow available for discretionary expenditures, as they exclude cash requirements for debt service or other non-discretionary expenditures that are not deducted.
Net debt is defined as the sum of the carrying value of long-term and short-term debt on its consolidated balance sheet, less cash, excluding restricted cash on the balance sheet. Management views net debt as a measure of TETRA's ability to reduce debt, add to cash balances, pay dividends, repurchase stock, and fund investing and financing activities.
Net leverage ratio is defined as debt excluding financing fees & discount on term loan and including letters of credit and guarantees, less cash divided by trailing twelve months adjusted EBITDA for credit facilities. Adjusted EBITDA for credit facilities consists of adjusted EBITDA described above, less non-cash (gain) loss on sale of investments, (gain) loss on sales of assets and excluding certain special or other charges (or credits). Management primarily uses this metric to assess TETRA's ability to borrow, reduce debt, add to cash balances, pay distributions, and fund investing and financing activities.
Return on net capital employed is defined as Adjusted EBIT divided by average net capital employed. Adjusted EBIT is defined as net income (loss) before taxes and discontinued operations, interest, and certain non-cash charges, and non-recurring adjustments. Net capital employed is defined as assets, excluding assets associated with the
Schedule E: Non-GAAP Reconciliation of Adjusted Net Income (Loss) From Continuing Operations (Unaudited)
| |||||||||
Three Months Ended | Twelve Months Ended | ||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | |||||
(in thousands, except per share amounts) | |||||||||
Income (loss) before taxes and discontinued operations | $ 7,392 | $ 7,576 | $ (3,631) | $ 28,742 | $ 31,699 | ||||
Provision (benefit) for income taxes | (94,841) | 4,744 | 608 | (84,878) | 6,220 | ||||
Noncontrolling interest attributed to continuing operations | 1 | — | 2 | 4 | 27 | ||||
Income (loss) from continuing operations | 102,232 | 2,832 | (4,241) | 113,616 | 25,452 | ||||
Completion fluids buy-back allowance adjustment | (1,776) | — | — | (1,776) | — | ||||
Exploration, pre-development costs and collaborative arrangements | — | — | 2,684 | — | 2,838 | ||||
Insurance (recoveries) expenditures | — | — | — | — | (2,678) | ||||
Adjustment to long-term incentives | — | — | 281 | — | 1,526 | ||||
Transaction, restructuring, and other expenses | 852 | 592 | 258 | 1,349 | 502 | ||||
Impairments and other charges | — | 109 | 2,189 | 109 | 2,966 | ||||
Former CEO stock appreciation right expense | 103 | (190) | (789) | (701) | 237 | ||||
Unusual foreign exchange loss | — | — | 2,444 | 1,387 | 2,444 | ||||
Loss on debt extinguishment | — | — | — | 5,535 | — | ||||
Unusual tax provision | (97,522) | — | 951 | (97,522) | 951 | ||||
Adjusted income from continuing operations | $ 3,889 | $ 3,343 | $ 3,777 | $ 21,997 | $ 34,238 | ||||
Diluted per share information | |||||||||
Income (loss) from continuing operations | $ 0.77 | $ 0.02 | $ (0.03) | $ 0.86 | $ 0.20 | ||||
Adjusted income from continuing operations | $ 0.03 | $ 0.03 | $ 0.03 | $ 0.17 | $ 0.26 | ||||
Diluted weighted average shares outstanding | 132,812 | 132,029 | 130,079 | 132,231 | 131,243 |
Schedule F: Non-GAAP Reconciliation of Adjusted EBITDA (Unaudited)
| |||||||||
Three Months Ended December 31, 2024 | |||||||||
Completion | Water & | Corporate | Other and | Total | |||||
(in thousands, except percents) | |||||||||
Revenues | $ 68,869 | $ 65,635 | $ — | $ — | $ 134,504 | ||||
Net income (loss) before taxes and discontinued operations | 17,331 | 2,149 | (12,529) | 441 | 7,392 | ||||
Completion fluids buy-back allowance adjustment | (1,776) | — | — | — | (1,776) | ||||
Former CEO stock appreciation right expense | — | — | 103 | — | 103 | ||||
Transaction, restructuring and other expenses | 56 | 146 | 650 | — | 852 | ||||
Interest (income) expense, net | 633 | (75) | — | 4,674 | 5,232 | ||||
Depreciation, amortization, and accretion | 2,569 | 6,686 | — | 99 | 9,354 | ||||
Equity-based compensation expense | — | — | 1,668 | — | 1,668 | ||||
Adjusted EBITDA | $ 18,813 | $ 8,906 | $ (10,108) | $ 5,214 | $ 22,825 | ||||
Adjusted EBITDA as a % of revenue | 27.3 % | 13.6 % | 17.0 % |
Three Months Ended September 30, 2024 | |||||||||
Completion | Water & | Corporate | Other and | Total | |||||
(in thousands, except percents) | |||||||||
Revenues | $ 65,131 | $ 76,569 | $ — | $ — | $ 141,700 | ||||
Net income (loss) before taxes and discontinued operations | 19,119 | 4,674 | (10,779) | (5,438) | 7,576 | ||||
Impairments and other charges | — | — | 109 | — | 109 | ||||
Former CEO stock appreciation right expense | — | — | (190) | — | (190) | ||||
Transaction, restructuring and other expenses | 39 | 203 | 350 | — | 592 | ||||
Interest (income) expense, net | (942) | (5) | — | 6,043 | 5,096 | ||||
Depreciation, amortization, and accretion | 2,416 | 6,328 | — | 93 | 8,837 | ||||
Equity-based compensation expense | — | — | 1,481 | — | 1,481 | ||||
Adjusted EBITDA | $ 20,632 | $ 11,200 | $ (9,029) | $ 698 | $ 23,501 | ||||
Adjusted EBITDA as a % of revenue | 31.7 % | 14.6 % | 16.6 % |
Three Months Ended December 31, 2023 | |||||||||
Completion | Water & | Corporate | Other and | Total | |||||
(in thousands, except percents) | |||||||||
Revenues | $ 72,556 | $ 80,570 | $ — | $ — | $ 153,126 | ||||
Net income (loss) before taxes and discontinued operations | 10,984 | 2,855 | (11,929) | (5,541) | (3,631) | ||||
Impairments and other charges | 2,189 | — | — | — | 2,189 | ||||
Exploration and, pre-development costs and collaborative arrangements | 2,684 | — | — | — | 2,684 | ||||
Adjustment to long-term incentives | — | — | 281 | — | 281 | ||||
Former CEO stock appreciation right expense | — | — | (789) | — | (789) | ||||
Transaction, restructuring and other expenses | 3 | — | 255 | — | 258 | ||||
Unusual foreign exchange loss | — | 2,444 | — | — | 2,444 | ||||
Interest (income) expense, net | (47) | (38) | — | 5,762 | 5,677 | ||||
Depreciation, amortization, and accretion | 2,508 | 6,019 | — | 96 | 8,623 | ||||
Equity-based compensation expense | — | — | 6,406 | — | 6,406 | ||||
Adjusted EBITDA | $ 18,321 | $ 11,280 | $ (5,776) | $ 317 | $ 24,142 | ||||
Adjusted EBITDA as a % of revenue | 25.3 % | 14.0 % | 15.8 % |
Year Ended December 31, 2024 | |||||||||
Completion | Water & | Corporate | Other and | Total | |||||
(in thousands, except percents) | |||||||||
Revenue | $ 311,301 | $ 287,810 | $ — | $ — | $ 599,111 | ||||
Net income (loss) before taxes and discontinued operations | 82,895 | 10,700 | (45,099) | (19,754) | 28,742 | ||||
Completion fluids buy-back allowance adjustment | (1,776) | — | — | — | (1,776) | ||||
Impairments and other charges | — | — | — | 109 | 109 | ||||
Former CEO stock appreciation right expense | — | — | (701) | — | (701) | ||||
Transaction, restructuring and other expenses | (26) | 349 | 1,026 | — | 1,349 | ||||
Loss on debt extinguishment | — | — | — | 5,535 | 5,535 | ||||
Unusual foreign exchange (gain) loss | — | 1,387 | — | — | 1,387 | ||||
Interest (income) expense, net | (713) | 64 | — | 23,114 | 22,465 | ||||
Depreciation, amortization, and accretion | 9,733 | 25,631 | — | 357 | 35,721 | ||||
Equity-based compensation expense | — | — | 6,572 | — | 6,572 | ||||
Adjusted EBITDA | $ 90,113 | $ 38,131 | $ (38,202) | $ 9,361 | $ 99,403 | ||||
Adjusted EBITDA as % of revenue | 28.9 % | 13.2 % | 16.6 % | ||||||
Year Ended December 31, 2023 | |||||||||
Completion | Water & | Corporate | Other and | Total | |||||
(in thousands, except percents) | |||||||||
Revenue | $ 313,030 | $ 313,232 | $ — | $ — | $ 626,262 | ||||
Net income (loss) before taxes and discontinued operations | 78,314 | 25,724 | (49,135) | (23,204) | $ 31,699 | ||||
Insurance recoveries | (2,678) | — | — | — | (2,678) | ||||
Impairments and other charges | 2,189 | — | 777 | — | 2,966 | ||||
Exploration, pre-development costs | 2,838 | — | — | — | 2,838 | ||||
Adjustments to long-term incentives | — | — | 1,526 | — | 1,526 | ||||
Former CEO stock appreciation right expense | — | — | 237 | — | 237 | ||||
Transaction, restructuring and other expenses | — | — | 502 | — | 502 | ||||
Unusual foreign exchange (gain) loss | — | 2,444 | — | — | 2,444 | ||||
Interest (income) expense, net | (647) | 205 | — | 22,791 | 22,349 | ||||
Depreciation, amortization, and accretion | 9,053 | 24,876 | — | 400 | 34,329 | ||||
Equity-based compensation expense | — | — | 10,622 | — | 10,622 | ||||
Adjusted EBITDA | $ 89,069 | $ 53,249 | $ (35,471) | $ (13) | $ 106,834 | ||||
Adjusted EBITDA as % of revenue | 28.5 % | 17.0 % | 17.1 % |
Schedule G: Non-GAAP Reconciliation of Net Debt (Unaudited) The following reconciliation of net debt is presented as a supplement to financial results prepared in accordance with GAAP.
| |||
December 31, | December 31, | ||
(in thousands) | |||
Unrestricted Cash | $ 36,987 | $ 52,485 | |
Term Credit Agreement | 179,696 | 157,505 | |
Net debt | $ 142,709 | $ 105,020 |
Schedule H: Non-GAAP Reconciliation to Total Adjusted Free Cash Flow From Continuing Operations (Unaudited)
| |||||||||
Three Months Ended | Twelve Months Ended | ||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | |||||
(in thousands) | |||||||||
Net cash provided by operating activities | $ 5,635 | $ 19,870 | $ 18,875 | $ 36,520 | $ 70,206 | ||||
Capital expenditures, net of proceeds from asset sales | (14,627) | (12,289) | (1,909) | (57,763) | (31,491) | ||||
Payments on financing lease obligations | (384) | (414) | (845) | (1,438) | (1,682) | ||||
Purchases of investments | — | (1,021) | — | (1,021) | (350) | ||||
Distributions from investments | 52 | 185 | 52 | 462 | 209 | ||||
Proceeds from sale of investment | — | — | 3,900 | — | 3,900 | ||||
Total Adjusted Free Cash Flow | $ (9,324) | $ 6,331 | $ 20,073 | $ (23,240) | $ 40,792 | ||||
Total Adjusted Free Cash Flow | $ (9,324) | $ 6,331 | $ 20,073 | $ (23,240) | $ 40,792 | ||||
Less Investments in | $ 220 | $ (8,659) | $ (1,972) | $ (22,371) | $ (4,792) | ||||
Base Business Adjusted Free Cash Flow | $ (9,544) | $ 14,990 | $ 22,045 | $ (869) | $ 45,584 |
Schedule I: Non-GAAP Reconciliation to Net Leverage Ratio (Unaudited)
| |||||||||
Three Months Ended | Twelve Months Ended | ||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | |||||
(in thousands) | |||||||||
Net income (loss) before taxes and discontinued operations | $ 7,392 | $ 7,576 | $ 12,479 | $ 1,295 | $ 28,742 | ||||
Completion fluids buy-back allowance adjustment | (1,776) | — | — | — | (1,776) | ||||
Impairments and other charges | — | 109 | — | — | 109 | ||||
Former CEO stock appreciation right expense | 103 | (190) | (428) | (186) | (701) | ||||
Transaction, restructuring and other expenses | 852 | 592 | 37 | (135) | 1,346 | ||||
Loss on debt extinguishment | — | — | — | 5,535 | 5,535 | ||||
Unusual foreign exchange loss | — | — | 1,387 | — | 1,387 | ||||
Interest (income) expense, net | 5,232 | 5,096 | 6,185 | 5,952 | 22,465 | ||||
Depreciation, amortization, and accretion | 9,354 | 8,837 | 8,774 | 8,756 | 35,721 | ||||
Equity-based compensation expense | 1,668 | 1,481 | 1,800 | 1,623 | 6,572 | ||||
Non-cash (gain) loss on investments | (5,013) | (750) | (46) | (2,795) | (8,604) | ||||
(Gain) loss on sale of assets | (196) | (75) | (38) | (29) | (338) | ||||
Other debt covenant adjustments | 384 | 362 | 275 | 28 | 1,049 | ||||
Debt covenant adjusted EBITDA | $ 18,000 | $ 23,038 | $ 30,425 | $ 20,044 | $ 91,507 | ||||
December 31, | |||||||||
(in thousands, | |||||||||
Term credit agreement | $ 190,000 | ||||||||
Capital lease obligations | 7,793 | ||||||||
Other obligations | 1,280 | ||||||||
ABL letters of credit and guarantees | 175 | ||||||||
Total debt and commitments | 199,248 | ||||||||
Unrestricted cash | 36,987 | ||||||||
Net debt and commitments | $ 162,261 | ||||||||
Net leverage ratio | 1.77 |
Schedule J: Non-GAAP Reconciliation to Return on Net Capital Employed (Unaudited)
| |||||||||
Three Months Ended | Twelve Months Ended | ||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | |||||
(in thousands) | |||||||||
Net income (loss) before taxes and discontinued operations | $ 7,392 | $ 7,576 | $ 12,479 | $ 1,295 | $ 28,742 | ||||
Completion fluids buy-back allowance adjustment | (1,776) | — | — | — | (1,776) | ||||
Impairments and other charges | — | 109 | — | — | 109 | ||||
Former CEO stock appreciation right expense (credit) | 103 | (190) | (428) | (186) | (701) | ||||
Transaction, restructuring and other expenses | 852 | 592 | 37 | (135) | 1,346 | ||||
Loss on debt extinguishment | — | — | — | 5,535 | 5,535 | ||||
Unusual foreign exchange loss | — | — | 1,387 | — | 1,387 | ||||
Interest expense, net | 5,232 | 5,096 | 6,185 | 5,952 | 22,465 | ||||
Adjusted EBIT | $ 11,803 | $ 13,183 | $ 19,660 | $ 12,461 | $ 57,107 | ||||
December 31, | December 31, | ||||||||
(in thousands, except ratio) | |||||||||
Consolidated total assets | $ 605,195 | $ 478,961 | |||||||
Plus: assets impaired in last twelve months | 109 | 2,966 | |||||||
Less: cash, cash equivalents and restricted cash | 37,208 | 52,485 | |||||||
Adjusted assets employed | $ 568,096 | $ 429,442 | |||||||
Consolidated current liabilities | $ 123,349 | $ 125,962 | |||||||
Less: current liabilities associated with discontinued operations | 5,830 | — | |||||||
Adjusted current liabilities | $ 117,519 | $ 125,962 | |||||||
Net capital employed | $ 450,577 | $ 303,480 | |||||||
Average net capital employed | $ 377,029 | ||||||||
Return on net capital employed for the twelve months ended December 31, 2024 | 15.1 % |
Schedule K: Non-GAAP Reconciliation of Adjusted EBITDA for Projected First Half 2025 and Actual First Half 2024
| ||||
Six Months Ended | ||||
June 30, 2024 | June 30, 2025 | |||
(in thousands) | Actual | Projected Range - Low to High | ||
Revenue | $ 322,907 | $ 325,000 | $ 355,000 | |
Net income before taxes and discontinued operations | 13,774 | 19,000 | 34,000 | |
Former CEO stock appreciation right expense | (614) | — | — | |
Transaction, restructuring and other expenses | (98) | — | — | |
Loss on debt extinguishment | 5,535 | — | — | |
Unusual foreign exchange loss | 1,387 | — | — | |
Interest (income) expense, net | 12,137 | 11,000 | 9,000 | |
Depreciation, amortization, and accretion | 17,530 | 21,000 | 19,000 | |
Equity-based compensation expense | 3,423 | 4,000 | 3,000 | |
Adjusted EBITDA | $ 53,074 | $ 55,000 | $ 65,000 |
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SOURCE TETRA Technologies, Inc.
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