SUGAR LAND, Texas, April 7, 2015 (GLOBE NEWSWIRE) -- Team, Inc. (NYSE:TISI) today announced financial results for the third quarter ending February 28, 2015 of fiscal year 2015. Team reported adjusted earnings of $2.4 million ($0.11 per diluted share), versus adjusted earnings of $0.2 million ($0.01 per diluted share) for the prior year quarter. Revenues for the current year quarter increased by 7% to $174.6 million compared to revenues of $163.2 million for the prior year quarter. (Adjusted earnings in the current quarter exclude non-routine charges not indicative of Team's ongoing operating activities of $2.1 million (net of tax), or $0.10 per diluted share, related to a loss on Team's Venezuela investment ($0.8 million), legal fees related to defense of a Team patent ($0.7 million), foreign currency losses ($0.4 million) and equipment write-downs ($0.2 million). Adjusted earnings in the prior year quarter exclude $1.2 million (net of tax), or $0.06 per diluted share, of non-routine Venezuela currency revaluation loss).
Year-to-date revenues were $603.3 million, a 12% increase compared to revenues of $538.0 million for the prior year. Year-to-date adjusted earnings were $26.9 million ($1.23 per diluted share), versus adjusted earnings of $18.2 million ($0.86 per diluted share) for the prior year. (Adjusted earnings in the current year exclude $2.2 million (net of tax), or $0.10 per diluted share, as described above).
"We are pleased with our operating performance and progress," said Ted Owen, Team's President and Chief Executive Officer. "We remain on track to achieve our budgeted adjusted earnings of $2.00 per diluted share, which would be a 35% increase in year over year earnings and a record performance for Team."
Highlights
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Revenues ($174.6 million) and adjusted earnings ($0.11 per diluted share).
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Revenue growth of 7% in the quarter and 12% year to date.
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Gross margin improvement of one percentage point for both the quarter and year to date (27% and 30%, respectively).
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Adjusted earnings before interest and taxes ("Adjusted EBIT") of $4.4 million for the quarter and $45.1 million year to date.
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Adjusted EBITDA (Adjusted EBIT plus depreciation, amortization and non-cash compensation expenses) of $11.3 million in the current quarter (up 55%) and $65.6 million year to date (up 29%).
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Trailing twelve month ("TTM") Adjusted EBITDA of $92.6 million -- an 11.4% margin on TTM revenues of $814.8 million.
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Net debt of $50.9 million ($86.5 million debt less $35.6 million cash). Net debt to TTM Adjusted EBITDA of 0.55 to 1.
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Year-to-date capital expenditures of $18.7 million.
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Stock buybacks totaled $21.1 million (547 thousand shares) in the current quarter.
GAAP Earnings
Team's net income available to shareholders reported in accordance with generally accepted accounting principles (including non-routine items) was $0.3 million ($0.01 per diluted share) for the current quarter as compared to a net loss of $1.0 million (loss of $0.05 per diluted share) in the prior year. Certain non-routine items have been excluded when arriving at adjusted earnings. A reconciliation of net income, reported in accordance with generally accepted accounting principles, to adjusted net income is contained in the tables below.
Earnings Conference Call
In connection with this earnings release, Team will hold its quarterly conference call on Wednesday, April 8, 2015 at 8:00 a.m. Central Time (9:00 a.m. Eastern). The call will be broadcast over the Web and can be accessed on Team's Website, www.teamindustrialservices.com. Individuals wishing to participate in the conference call by phone may call 866-270-6057 and use conference code 88003568 when prompted.
About Team, Inc.
Headquartered near Houston, Texas, Team Inc. is a leading provider of specialty industrial services, including inspection and assessment, required in maintaining and installing high-temperature and high-pressure piping systems and vessels that are utilized extensively in the refining, petrochemical, power, pipeline and other heavy industries. Team offers these services in over 125 locations throughout the world. Team's common stock is traded on the New York Stock Exchange under the ticker symbol "TISI".
Certain forward-looking information contained herein is being provided in accordance with the provisions of the Private Securities Litigation Reform Act of 1995. We have made reasonable efforts to ensure that the information, assumptions and beliefs upon which this forward-looking information is based are current, reasonable and complete. Such forward-looking statements involve estimates, assumptions, judgments and uncertainties. There are known and unknown factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking information. Such known factors are detailed in the Company's Annual Report on Form 10-K and in the Company's Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission, and in other reports filed by the Company with the Securities and Exchange Commission from time to time. Accordingly, there can be no assurance that the forward-looking information contained herein will occur or that objectives will be achieved. We assume no obligation to publicly update or revise any forward-looking statements made today or any other forward-looking statements made by the company, whether as a result of new information, future events or otherwise.
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TEAM, INC. AND SUBSIDIARIES |
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SUMMARY OF OPERATING RESULTS |
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(in thousands, except per share data) |
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Three Months Ended |
Nine Months Ended |
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February 28, |
February 28, |
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2015 |
2014 |
2015 |
2014 |
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(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
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Revenues |
$ 174,589 |
$ 163,236 |
$ 603,329 |
$ 538,040 |
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Operating expenses |
127,877 |
121,540 |
421,448 |
382,532 |
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Gross margin |
46,712 |
41,696 |
181,881 |
155,508 |
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Selling, general and administrative expenses |
43,786 |
40,725 |
138,456 |
125,482 |
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Earnings from unconsolidated affiliates |
-- |
29 |
-- |
822 |
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Gain from revaluation of contingent consideration |
-- |
-- |
-- |
2,138 |
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Operating income |
2,926 |
1,000 |
43,425 |
32,986 |
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Foreign currency loss |
673 |
1,868 |
1,489 |
2,398 |
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Loss on investment in Venezuela |
1,177 |
-- |
1,177 |
-- |
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Interest expense, net |
560 |
660 |
1,786 |
2,079 |
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Earnings (loss) before income taxes |
516 |
(1,528) |
38,973 |
28,509 |
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Provision for income taxes |
187 |
(557) |
14,031 |
10,406 |
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Net income (loss) |
329 |
(971) |
24,942 |
18,103 |
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Less: Income attributable to non-controlling interest |
25 |
39 |
241 |
178 |
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Net income (loss) available to common shareholders |
$ 304 |
$ (1,010) |
$ 24,701 |
$ 17,925 |
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Earnings (loss) per common share: |
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Basic |
$ 0.01 |
$ (0.05) |
$ 1.20 |
$ 0.88 |
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Diluted |
$ 0.01 |
$ (0.05) |
$ 1.13 |
$ 0.84 |
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Weighted average number of shares outstanding: |
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Basic |
20,560 |
20,384 |
20,569 |
20,432 |
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Diluted |
21,740 |
21,193 |
21,844 |
21,284 |
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TEAM, INC. AND SUBSIDIARIES |
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ADDITIONAL FINANCIAL INFORMATION |
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(in thousands, except per share data) |
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Three Months Ended |
Nine Months Ended |
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February 28, |
February 28, |
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2015 |
2014 |
2015 |
2014 |
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(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
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Adjusted Net income: |
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Net income (loss) available to common shareholders |
$ 304 |
$ (1,010) |
$ 24,701 |
$ 17,925 |
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Non-routine Venezuela currency devaluation |
-- |
1,858 |
-- |
1,858 |
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Non-routine revaluation contingent consideration |
-- |
-- |
-- |
(2,138) |
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Non-routine acquisition costs |
-- |
-- |
164 |
-- |
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Non-routine legal fees |
1,096 |
-- |
1,096 |
-- |
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Non-routine fixed asset write-down |
383 |
-- |
383 |
-- |
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Non-routine loss on investment in Venezuela |
1,177 |
-- |
1,177 |
-- |
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Non-routine foreign currency loss |
673 |
-- |
673 |
-- |
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Non-routine severance costs |
-- |
-- |
-- |
742 |
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Tax impact of adjustments |
(1,198) |
(678) |
(1,257) |
(173) |
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Adjusted Net income |
$ 2,435 |
$ 170 |
$ 26,937 |
$ 18,214 |
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Adjusted Net income per common share: |
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Basic |
$ 0.12 |
$ 0.01 |
$ 1.31 |
$ 0.89 |
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Diluted |
$ 0.11 |
$ 0.01 |
$ 1.23 |
$ 0.86 |
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Adjusted EBITDA: |
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Operating income ("EBIT") |
$ 2,926 |
$ 1,000 |
$ 43,425 |
$ 32,986 |
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Non-routine revaluation contingent consideration |
-- |
-- |
-- |
(2,138) |
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Non-routine fixed asset write-down |
383 |
-- |
383 |
-- |
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Non-routine acquisition costs |
-- |
-- |
164 |
-- |
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Non-routine legal fees |
1,096 |
-- |
1,096 |
-- |
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Non-routine severance costs |
-- |
-- |
-- |
742 |
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Adjusted EBIT |
4,405 |
1,000 |
45,068 |
31,590 |
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Depreciation and amortization |
5,688 |
5,285 |
16,852 |
15,976 |
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Non-cash share-based compensation costs |
1,226 |
995 |
3,691 |
3,205 |
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Adjusted EBITDA |
$ 11,319 |
$ 7,280 |
$ 65,611 |
$ 50,771 |
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Segment Data: |
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Revenues: |
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IHT |
$ 95,350 |
$ 85,149 |
$ 335,024 |
$ 290,409 |
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MS |
64,999 |
63,440 |
217,066 |
200,196 |
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Quest |
14,240 |
14,647 |
51,239 |
47,435 |
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$ 174,589 |
$ 163,236 |
$ 603,329 |
$ 538,040 |
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Adjusted EBIT: |
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IHT |
$ 7,536 |
$ 3,783 |
$ 41,822 |
$ 29,528 |
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MS |
3,740 |
2,939 |
19,417 |
17,120 |
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Quest |
1,196 |
1,170 |
8,313 |
5,986 |
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Corporate and shared support |
(8,067) |
(6,892) |
(24,484) |
(21,044) |
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$ 4,405 |
$ 1,000 |
$ 45,068 |
$ 31,590 |
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Adjusted EBITDA: |
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IHT |
$ 9,674 |
$ 5,719 |
$ 48,029 |
$ 35,475 |
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MS |
5,591 |
4,740 |
25,015 |
22,511 |
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Quest |
2,626 |
2,513 |
12,567 |
10,019 |
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Corporate and shared support |
(6,572) |
(5,692) |
(20,000) |
(17,234) |
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$ 11,319 |
$ 7,280 |
$ 65,611 |
$ 50,771 |
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TEAM, INC. AND SUBSIDIARIES |
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SUMMARY CONSOLIDATED BALANCE SHEET INFORMATION |
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FEBRUARY 28, 2015 AND MAY 31, 2014 |
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(in thousands) |
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February 28, |
May 31, |
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2015 |
2014 |
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(unaudited) |
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Current assets |
$ 252,139 |
$ 248,814 |
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Property, plant and equipment, net |
93,124 |
89,961 |
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Other non-current assets |
138,288 |
146,166 |
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Total assets |
$ 483,551 |
$ 484,941 |
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Current liabilities |
$ 61,050 |
$ 75,143 |
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Long term debt net of current maturities |
86,445 |
73,721 |
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Other non-current liabilities |
18,709 |
19,032 |
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Stockholders' equity |
317,347 |
317,045 |
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Total liabilities and stockholders' equity |
$ 483,551 |
$ 484,941 |
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TEAM, INC. AND SUBSIDIARIES |
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SUMMARY CONSOLIDATED CASH FLOW INFORMATION |
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FEBRUARY 28, 2015 AND FEBRUARY 28, 2014 |
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(in thousands) |
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Nine Months Ended |
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February 28, |
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2015 |
2014 |
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(unaudited) |
(unaudited) |
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Net income |
$24,942 |
$18,103 |
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Depreciation, amortization and non-cash share based compensation expense |
20,543 |
19,181 |
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Loss on investment in Venezuela |
1,177 |
-- |
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Gain on contingent consideration revaluation |
-- |
(2,138) |
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Working capital changes |
(18,651) |
3,511 |
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Other items affecting operating cash flow |
3,201 |
1,858 |
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Net cash provided by operating activities |
$31,212 |
$40,515 |
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Capital expenditures |
(18,712) |
(23,758) |
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Cash used for business acquisitions, net |
(2,949) |
(10,175) |
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Other items affecting investing cash flow |
(316) |
381 |
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Net cash used in investing activities |
($21,977) |
($33,552) |
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Borrowings of debt, net |
15,690 |
9,800 |
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Deferred consideration payments |
(1,000) |
(1,000) |
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Contingent consideration payments |
(1,000) |
-- |
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Purchases of treasury stock |
(21,138) |
(13,334) |
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Cash associated with share-based payment arrangements, net |
2,676 |
4,165 |
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Net cash used in financing activities |
($4,772) |
($369) |
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Effect of exchange rate changes |
(3,549) |
(1,294) |
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Change in cash and cash equivalents |
$914 |
$5,300 |
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CONTACT: Greg L. Boane (281) 388-5541
