Oil States Announces Fourth Quarter 2022 Results
- Revenue of
$202 .4 million increased 7% sequentially and 25% year-over-year - Excluding a third quarter 2022 litigation-related settlement gain of
$6 .1 million, operating income of$3 .3 million increased$4 .3 million sequentially and$14 .5 million year-over-year - Net income of
$2 .9 million, or$0 .05 per diluted share, reported for the quarter - Adjusted EBITDA (a non-GAAP measure(1)) of
$20 .5 million decreased$1 .4 million sequentially but increased$7 .2 million year-over-year. Excluding the third quarter 2022 litigation-related benefit, Adjusted EBITDA increased$4 .7 million, or 30%, sequentially. - Cash flow from operations totaled
$13 .9 million during the quarter - Offshore/Manufactured Products segment's backlog increased 19% sequentially to $308 million at the end of the quarter (highest level since the fourth quarter of 2015), with a quarterly book-to-bill ratio of 1.5x, which included two notable production facility project awards exceeding $20 million each
- Board of Directors approved a
$25 .0 million stock repurchase plan
Three Months Ended | % Change | ||||||||||||||||
(Unaudited, in Thousands, Except Per Share Amounts) | 2022 |
2022 |
2021 |
Sequential | Year-over-Year | ||||||||||||
Consolidated results: | |||||||||||||||||
Revenues | $ | 202,434 | $ | 189,394 | $ | 161,320 | 7 | % | 25 | % | |||||||
Operating income (loss) | $ | 3,273 | $ | 5,058 | $ | (11,273 | ) | (35 | )% | nm | |||||||
Net income (loss) | $ | 2,885 | $ | 2,143 | $ | (19,870 | ) | 35 | % | nm | |||||||
Diluted earning per share | $ | 0.05 | $ | 0.03 | $ | (0.33 | ) | 67 | % | nm | |||||||
Adjusted EBITDA(1) | $ | 20,542 | $ | 21,962 | $ | 13,392 | (6 | )% | 53 | % | |||||||
Revenues by segment: | |||||||||||||||||
Offshore/Manufactured Products | $ | 105,107 | $ | 96,037 | $ | 92,209 | 9 | % | 14 | % | |||||||
Well |
67,689 | 60,509 | 43,336 | 12 | % | 56 | % | ||||||||||
Downhole Technologies | 29,638 | 32,848 | 25,775 | (10 | )% | 15 | % | ||||||||||
Operating income (loss) by segment: | |||||||||||||||||
Offshore/Manufactured Products | $ | 12,258 | $ | 13,373 | $ | 7,802 | (8 | )% | 57 | % | |||||||
Well |
5,300 | 2,359 | (7,818 | ) | 125 | % | nm | ||||||||||
Downhole Technologies | (3,337 | ) | (342 | ) | (4,525 | ) | nm | 26 | % | ||||||||
Adjusted Segment EBITDA (a non-GAAP measure(1)): | |||||||||||||||||
Offshore/Manufactured Products | $ | 17,751 | $ | 18,304 | $ | 13,655 | (3 | )% | 30 | % | |||||||
Well |
12,516 | 9,723 | 6,150 | 29 | % | 104 | % | ||||||||||
Downhole Technologies | 1,042 | 4,100 | 132 | (75 | )% | nm |
___________________
(1) Adjusted EBITDA and Adjusted Segment EBITDA are non-GAAP measures, see "Reconciliations of GAAP to Non-GAAP Financial Information" tables below for reconciliations to their most comparable GAAP measures as well as further clarification and explanation.
"With continued improvement in industry fundamentals throughout 2022 – both domestically and internationally,
"Our year-over-year results were impressive, with consolidated revenues and operating income in the fourth quarter 2022 increasing by
"Our Offshore/Manufactured Products segment revenues increased 9% sequentially totaling
"Revenues reported by our Well Site Services segment increased 12% and Adjusted Segment EBITDA rose 29% from the third quarter of 2022 – driven by higher
"Our Downhole Technologies segment revenues decreased 10% and Adjusted Segment EBITDA declined 75% from the third quarter of 2022, due primarily to lower international perforating sales, manufacturing labor constraints and higher material and supply chain costs. Additionally, the segment recognized inventory and receivable reserves totaling
"As we enter 2023, we are encouraged by the high-level of bidding and quoting activity for major offshore projects, higher backlog levels within our Offshore/Manufactured Products segment and continued strong industry fundamentals that suggest a continuation of strong investments by operators.
"We have no significant debt maturities until 2026, providing
For the year ended
Business Segment Results
(See Segment Data and Adjusted Segment EBITDA tables below)
Offshore/Manufactured Products
Offshore/Manufactured Products reported revenues of
Backlog totaled $308 million as of
Well
Well
Downhole Technologies
Downhole Technologies reported revenues of
Corporate
Corporate operating expenses in the fourth quarter of 2022 totaled
Interest Expense, Net
Net interest expense totaled
Income Taxes
The Company recognized a tax benefit of
Financial Condition
No borrowings were outstanding under the Company's asset-based revolving credit facility (the "ABL Facility") at
The Company's total debt represented 18% of combined total debt and stockholders' equity at
On
On
Fourth Quarter Highlights – Technology Advancement and R&D Efforts
- Successfully completed a test of OSI Minerals™ deepsea mineral riser system at a water depth of over 13,000 feet
- Successfully performed a tank test of a prototype model of our proprietary fixed tension leg platform ("F-TLP™") design for offshore wind installations in water depths of up to approximately 500 feet
- Recognized by World Oil as a finalist for our Merlin™ high-pressure, high-temperature riser system and our managed pressure drilling ("MPD") and riser gas handling system
- Continued to invest in and deploy our patented active-seat valve technology, which reduces the environmental impact of heavy greasing requirements and promotes personnel safety with decreased time in the hazardous wellhead zone
- Tempress extended-reach HydroPull™ tool was successfully deployed in a two and one-half mile lateral in the
Middle East , allowing the operator to complete an offshore clean-out operation in one trip - Awarded two production facility projects each totaling over $20 million for FlexJoint™ products, which provide long-term fatigue protection for offshore, high-pressure production riser systems
- Approximately 9% of our Offshore/Manufactured Products bookings in 2022 were for non-traditional energy applications
Conference Call Information
The call is scheduled for
About
For more information on the Company, please visit
Cautionary Language Concerning 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, geopolitical tensions, regulatory pressures related to environmental, social and governance considerations, 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
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Amounts)
Three Months Ended | Year Ended | ||||||||||||||||||
2022 |
2022 |
2021 |
2022 |
2021 |
|||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||
Revenues: | |||||||||||||||||||
Products | $ | 101,027 | $ | 99,743 | $ | 89,401 | $ | 385,564 | $ | 299,293 | |||||||||
Services | 101,407 | 89,651 | 71,919 | 352,142 | 273,868 | ||||||||||||||
202,434 | 189,394 | 161,320 | 737,706 | 573,161 | |||||||||||||||
Costs and expenses: | |||||||||||||||||||
Product costs | 81,606 | 81,576 | 72,890 | 307,371 | 246,589 | ||||||||||||||
Service costs | 76,891 | 69,723 | 60,357 | 271,185 | 223,807 | ||||||||||||||
Cost of revenues (exclusive of depreciation and amortization expense presented below)(1) | 158,497 | 151,299 | 133,247 | 578,556 | 470,396 | ||||||||||||||
Selling, general and administrative expense | 25,074 | 23,374 | 20,297 | 96,038 | 83,692 | ||||||||||||||
Depreciation and amortization expense | 15,865 | 16,413 | 18,655 | 67,334 | 80,741 | ||||||||||||||
Impairments of fixed and lease assets | — | — | 722 | — | 4,166 | ||||||||||||||
Other operating income, net(2) | (275 | ) | (6,750 | ) | (328 | ) | (7,127 | ) | (1,042 | ) | |||||||||
199,161 | 184,336 | 172,593 | 734,801 | 637,953 | |||||||||||||||
Operating income (loss) | 3,273 | 5,058 | (11,273 | ) | 2,905 | (64,792 | ) | ||||||||||||
Interest expense, net | (2,333 | ) | (2,637 | ) | (2,577 | ) | (10,280 | ) | (10,170 | ) | |||||||||
Other income (expense), net(3) | 1,423 | 491 | (6,289 | ) | 3,315 | 1,628 | |||||||||||||
Income (loss) before income taxes | 2,363 | 2,912 | (20,139 | ) | (4,060 | ) | (73,334 | ) | |||||||||||
Income tax (provision) benefit | 522 | (769 | ) | 269 | (5,480 | ) | 9,341 | ||||||||||||
Net income (loss) | $ | 2,885 | $ | 2,143 | $ | (19,870 | ) | $ | (9,540 | ) | $ | (63,993 | ) | ||||||
Net income (loss) per share: | |||||||||||||||||||
Basic | $ | 0.05 | $ | 0.03 | $ | (0.33 | ) | $ | (0.15 | ) | $ | (1.06 | ) | ||||||
Diluted | 0.05 | 0.03 | (0.33 | ) | (0.15 | ) | (1.06 | ) | |||||||||||
Weighted average number of common shares outstanding: | |||||||||||||||||||
Basic | 62,678 | 62,674 | 60,380 | 61,638 | 60,293 | ||||||||||||||
Diluted | 62,768 | 62,676 | 60,380 | 61,638 | 60,293 |
________________
(1) In the three months and year ended
(2) Other operating income, net included a litigation-related settlement gain of
(3) Other income (expense), net in the three months and year ended
CONSOLIDATED BALANCE SHEETS
(In Thousands)
(Unaudited) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 42,018 | $ | 52,852 | |||
Accounts receivable, net | 218,769 | 186,080 | |||||
Inventories, net | 182,658 | 168,573 | |||||
Prepaid expenses and other current assets | 19,317 | 19,222 | |||||
Total current assets | 462,762 | 426,727 | |||||
Property, plant, and equipment, net | 303,835 | 338,583 | |||||
Operating lease assets, net | 23,028 | 25,388 | |||||
79,282 | 76,412 | ||||||
Other intangible assets, net | 169,798 | 185,749 | |||||
Other noncurrent assets | 25,687 | 32,889 | |||||
Total assets | $ | 1,064,392 | $ | 1,085,748 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Current portion of long-term debt | $ | 17,831 | $ | 18,262 | |||
Accounts payable | 73,251 | 63,343 | |||||
Accrued liabilities | 49,057 | 43,401 | |||||
Current operating lease liabilities | 6,142 | 6,481 | |||||
Income taxes payable | 2,605 | 2,564 | |||||
Deferred revenue | 44,790 | 43,236 | |||||
Total current liabilities | 193,676 | 177,287 | |||||
Long-term debt | 135,066 | 160,488 | |||||
Long-term operating lease liabilities | 20,658 | 23,452 | |||||
Deferred income taxes | 6,652 | 3,637 | |||||
Other noncurrent liabilities | 18,782 | 25,058 | |||||
Total liabilities | 374,834 | 389,922 | |||||
Stockholders' equity: | |||||||
Common stock | 766 | 739 | |||||
Additional paid-in capital | 1,122,292 | 1,105,135 | |||||
Retained earnings | 272,027 | 281,567 | |||||
Accumulated other comprehensive loss | (78,941 | ) | (66,031 | ) | |||
(626,586 | ) | (625,584 | ) | ||||
Total stockholders' equity | 689,558 | 695,826 | |||||
Total liabilities and stockholders' equity | $ | 1,064,392 | $ | 1,085,748 |
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
Year Ended |
|||||||
2022 | 2021 | ||||||
(Unaudited) | |||||||
Cash flows from operating activities: | |||||||
Net loss | $ | (9,540 | ) | $ | (63,993 | ) | |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||
Depreciation and amortization expense | 67,334 | 80,741 | |||||
Impairments of inventories | — | 3,581 | |||||
Impairments of fixed and lease assets | — | 4,166 | |||||
Stock-based compensation expense | 6,852 | 7,879 | |||||
Amortization of debt discount and deferred financing costs | 1,886 | 2,314 | |||||
Deferred income tax provision (benefit) | 2,020 | (8,639 | ) | ||||
Gains on extinguishment of 1.50% convertible senior notes | (176 | ) | (4,022 | ) | |||
Gains on disposals of assets | (2,856 | ) | (6,472 | ) | |||
Other, net | 2,066 | (511 | ) | ||||
Changes in operating assets and liabilities, net of effect from acquired business: | |||||||
Accounts receivable | (35,443 | ) | (24,407 | ) | |||
Inventories | (17,364 | ) | (10,334 | ) | |||
Accounts payable and accrued liabilities | 18,183 | 17,727 | |||||
Deferred revenue | 1,554 | (148 | ) | ||||
Other operating assets and liabilities, net | (1,654 | ) | (8 | ) | |||
Net cash flows provided by operating activities | 32,862 | 7,194 | |||||
Cash flows from investing activities: | |||||||
Capital expenditures | (20,266 | ) | (17,517 | ) | |||
Proceeds from disposition of property and equipment | 5,877 | 11,527 | |||||
Acquisition of business, net of cash acquired | (8,125 | ) | — | ||||
Other, net | (211 | ) | (636 | ) | |||
Net cash flows used in investing activities | (22,725 | ) | (6,626 | ) | |||
Cash flows from financing activities: | |||||||
Revolving credit facility borrowings | 10,090 | 12,873 | |||||
Revolving credit facility repayments | (10,090 | ) | (31,873 | ) | |||
Payment of promissory note to seller of |
(10,000 | ) | — | ||||
Issuance of 4.75% convertible senior notes | — | 135,000 | |||||
Purchases of 1.50% convertible senior notes | (8,450 | ) | (125,952 | ) | |||
Other debt and finance lease repayments, net | (732 | ) | (230 | ) | |||
Payment of financing costs | (105 | ) | (7,791 | ) | |||
Shares added to treasury stock as a result of net share settlements due to vesting of stock awards |
(1,002 | ) | (1,595 | ) | |||
Net cash flows used in financing activities | (20,289 | ) | (19,568 | ) | |||
Effect of exchange rate changes on cash and cash equivalents | (682 | ) | (159 | ) | |||
Net change in cash and cash equivalents | (10,834 | ) | (19,159 | ) | |||
Cash and cash equivalents, beginning of period | 52,852 | 72,011 | |||||
Cash and cash equivalents, end of period | $ | 42,018 | $ | 52,852 | |||
Cash paid for: | |||||||
Interest | $ | 8,339 | $ | 6,532 | |||
Income taxes, net | 534 | 152 |
SEGMENT DATA
(In Thousands)
(unaudited)
Three Months Ended | Year Ended | ||||||||||||||||||
2022 |
2022(2) |
2021(3) |
2022(4) |
2021(5) |
|||||||||||||||
Revenues: | |||||||||||||||||||
Offshore/Manufactured Products(1): | |||||||||||||||||||
Project-driven products | $ | 44,187 | $ | 38,911 | $ | 43,603 | $ | 158,040 | $ | 122,097 | |||||||||
Short-cycle products | 24,207 | 23,710 | 18,212 | 92,152 | 65,174 | ||||||||||||||
Other products and services | 36,713 | 33,416 | 30,394 | 131,531 | 111,458 | ||||||||||||||
Total Offshore/Manufactured Products | 105,107 | 96,037 | 92,209 | 381,723 | 298,729 | ||||||||||||||
Well |
67,689 | 60,509 | 43,336 | 231,189 | 170,940 | ||||||||||||||
Downhole Technologies | 29,638 | 32,848 | 25,775 | 124,794 | 103,492 | ||||||||||||||
Total revenues | $ | 202,434 | $ | 189,394 | $ | 161,320 | $ | 737,706 | $ | 573,161 | |||||||||
Operating income (loss): | |||||||||||||||||||
Offshore/Manufactured Products | $ | 12,258 | $ | 13,373 | $ | 7,802 | $ | 45,268 | $ | 15,447 | |||||||||
Well |
5,300 | 2,359 | (7,818 | ) | 4,865 | (34,511 | ) | ||||||||||||
Downhole Technologies | (3,337 | ) | (342 | ) | (4,525 | ) | (6,669 | ) | (13,470 | ) | |||||||||
Corporate | (10,948 | ) | (10,332 | ) | (6,732 | ) | (40,559 | ) | (32,258 | ) | |||||||||
Total operating income (loss) | $ | 3,273 | $ | 5,058 | $ | (11,273 | ) | $ | 2,905 | $ | (64,792 | ) |
________________
(1) Disaggregated revenue data is provided to supplement the Segment Data.
(2) Operating income (loss) for the three months ended
(3) Operating income (loss) for the three months ended
(4) Operating income (loss) for the year ended
(5) Operating income (loss) for the year ended
RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL INFORMATION
ADJUSTED EBITDA (A)
(In Thousands)
(unaudited)
Three Months Ended | Year Ended | ||||||||||||||||||
2022 |
2022 |
2021 |
2022 |
2021 |
|||||||||||||||
Net income (loss) | $ | 2,885 | $ | 2,143 | $ | (19,870 | ) | $ | (9,540 | ) | $ | (63,993 | ) | ||||||
Interest expense, net | 2,333 | 2,637 | 2,577 | 10,280 | 10,170 | ||||||||||||||
Income tax provision (benefit) | (522 | ) | 769 | (269 | ) | 5,480 | (9,341 | ) | |||||||||||
Depreciation and amortization expense | 15,865 | 16,413 | 18,655 | 67,334 | 80,741 | ||||||||||||||
Impairments of inventories | — | — | 1,468 | — | 3,581 | ||||||||||||||
Impairments of fixed and lease assets | — | — | 722 | — | 4,166 | ||||||||||||||
Settlement of disputes with seller of |
— | — | — | 620 | — | ||||||||||||||
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 | (19 | ) | — | — | (176 | ) | (4,022 | ) | |||||||||||
Severance and restructuring charges | — | — | 789 | — | 7,498 | ||||||||||||||
Adjusted EBITDA | $ | 20,542 | $ | 21,962 | $ | 13,392 | $ | 73,998 | $ | 38,120 |
________________
(A) The term Adjusted EBITDA consists of net income (loss) plus net interest expense, taxes, depreciation and amortization expense, and certain non-cash charges, less gains on extinguishment of 1.50% convertible senior notes (the "2023 Notes") and adjustments for certain other items. Adjusted EBITDA is not a measure of financial performance under generally accepted accounting principles ("GAAP") and should not be considered in isolation from or as a substitute for net income (loss) or cash flow measures prepared in accordance with GAAP or as a measure of profitability or liquidity. Additionally, Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. The Company has included Adjusted EBITDA as a supplemental disclosure because its management believes that Adjusted EBITDA provides 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 Adjusted 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 Adjusted EBITDA to net income (loss), which is the most directly comparable measure of financial performance calculated under GAAP.
RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL INFORMATION
ADJUSTED SEGMENT EBITDA (B)
(In Thousands)
(unaudited)
Three Months Ended | Year Ended | ||||||||||||||||||
2022 |
2022 |
2021 |
2022 |
2021 |
|||||||||||||||
Offshore/Manufactured Products: | |||||||||||||||||||
Operating income | $ | 12,258 | $ | 13,373 | $ | 7,802 | $ | 45,268 | $ | 15,447 | |||||||||
Other income (expense), net | 693 | (141 | ) | 21 | 638 | 770 | |||||||||||||
Depreciation and amortization expense | 4,800 | 5,072 | 5,502 | 20,451 | 22,190 | ||||||||||||||
Severance and restructuring charges | — | — | 330 | — | 868 | ||||||||||||||
Adjusted Segment EBITDA | $ | 17,751 | $ | 18,304 | $ | 13,655 | $ | 66,357 | $ | 39,275 | |||||||||
Well |
|||||||||||||||||||
Operating income (loss) | $ | 5,300 | $ | 2,359 | $ | (7,818 | ) | $ | 4,865 | $ | (34,511 | ) | |||||||
Other income, net | 711 | 632 | 3,010 | 3,207 | 6,162 | ||||||||||||||
Depreciation and amortization expense | 6,505 | 6,732 | 8,511 | 28,564 | 40,152 | ||||||||||||||
Impairments of inventories | — | — | 1,468 | — | 1,468 | ||||||||||||||
Impairment of fixed and lease assets | — | — | 722 | — | 4,166 | ||||||||||||||
Severance and restructuring charges | — | — | 257 | — | 4,266 | ||||||||||||||
Adjusted Segment EBITDA | $ | 12,516 | $ | 9,723 | $ | 6,150 | $ | 36,636 | $ | 21,703 | |||||||||
Downhole Technologies: | |||||||||||||||||||
Operating loss | $ | (3,337 | ) | $ | (342 | ) | $ | (4,525 | ) | $ | (6,669 | ) | $ | (13,470 | ) | ||||
Other expense, net | — | — | — | (86 | ) | (6 | ) | ||||||||||||
Depreciation and amortization expense | 4,379 | 4,442 | 4,455 | 17,628 | 17,591 | ||||||||||||||
Impairment of inventories | — | — | — | — | 2,113 | ||||||||||||||
Severance and restructuring charges | — | — | 202 | — | 809 | ||||||||||||||
Adjusted Segment EBITDA | $ | 1,042 | $ | 4,100 | $ | 132 | $ | 10,873 | $ | 7,037 | |||||||||
Corporate: | |||||||||||||||||||
Operating loss | $ | (10,948 | ) | $ | (10,332 | ) | $ | (6,732 | ) | $ | (40,559 | ) | $ | (32,258 | ) | ||||
Other income (expense), net | 19 | — | (9,320 | ) | (444 | ) | (5,298 | ) | |||||||||||
Depreciation and amortization expense | 181 | 167 | 187 | 691 | 808 | ||||||||||||||
Settlement of disputes with seller of |
— | — | — | 620 | — | ||||||||||||||
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 | (19 | ) | — | — | (176 | ) | (4,022 | ) | |||||||||||
Severance charges | — | — | — | — | 1,555 | ||||||||||||||
Adjusted Segment EBITDA | $ | (10,767 | ) | $ | (10,165 | ) | $ | (6,545 | ) | $ | (39,868 | ) | $ | (29,895 | ) |
________________
(B) The term Adjusted Segment EBITDA consists of operating income (loss) plus other income (expense), depreciation and amortization expense, and certain non-cash charges, less gains on extinguishment of the 2023 Notes and adjustments for certain other items. Adjusted Segment EBITDA is not a measure of financial performance under GAAP and should not be considered in isolation from or as a substitute for operating income (loss) or cash flow measures prepared in accordance with GAAP or as a measure of profitability or liquidity. Additionally, Adjusted Segment EBITDA may not be comparable to other similarly titled measures of other companies. The Company has included Adjusted Segment EBITDA as supplemental disclosure because its management believes that Adjusted Segment EBITDA provides 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 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 table above sets forth reconciliations of Adjusted Segment EBITDA to operating income (loss), which is the most directly comparable measure of financial performance calculated under GAAP.
RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL INFORMATION
RATIO OF NET DEBT TO ANNUALIZED FOURTH QUARTER 2022 ADJUSTED EBITDA (C)
(Dollars, In Thousands)
(unaudited)
2022 |
|||
Total debt | $ | 152,897 | |
Less: cash and cash equivalents | (42,018 | ) | |
Net Debt | $ | 110,879 | |
Fourth quarter 2022 Adjusted EBITDA | $ | 20,542 | |
Annualized fourth quarter 2022 Adjusted EBITDA | 82,168 | ||
Ratio of Net Debt to annualized fourth quarter Adjusted EBITDA | 1.4 | x |
________________
(C) The Company has included Net Debt and the ratio of Net Debt to annualized fourth quarter 2022 Adjusted EBITDA as a supplemental disclosure because its management believes that this data provides useful information regarding the level of the Company’s indebtedness and its ability to service debt. Net Debt and the ratio of Net Debt to annualized fourth quarter 2022 Adjusted EBITDA are not financial measures under GAAP and should not be considered in isolation from or as a substitute for total debt, net income (loss) or cash flow measures prepared in accordance with GAAP or as a measure of profitability or liquidity.
Company Contact:
Executive Vice President, Chief Financial Officer and Treasurer
(713) 652-0582
SOURCE:

Source: Oil States International, Inc.