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Jul 28, 2021

Oil States Announces Second Quarter 2021 Results of Operations

HOUSTON, July 28, 2021 (GLOBE NEWSWIRE) -- Oil States International, Inc. (NYSE: OIS) reported a net loss of $15.3 million, or $0.25 per share, for the second quarter of 2021. Results included non-cash operating lease asset impairment charges of $2.8 million ($2.2 million after-tax, or $0.04 per share), restructuring charges of $2.6 million ($2.0 million after-tax, or $0.03 per share) and non-cash gains on extinguishment of convertible senior notes of $0.4 million ($0.3 million after-tax, or $0.01 per share).

During the second quarter of 2021, the Company generated revenues of $145.7 million and Adjusted Consolidated EBITDA (Note A) of $10.1 million (excluding $2.6 million of restructuring charges). These results compare to revenues of $125.6 million and Adjusted Consolidated EBITDA of $6.1 million reported in the first quarter of 2021 (excluding $3.4 million of severance and restructuring charges).

Second quarter 2021 highlights and corporate actions included:

  • Sequentially, consolidated revenues and Adjusted Consolidated EBITDA increased 16% and 64%, respectively
  • Offshore/Manufactured Products generated a 27% quarterly revenue increase and a book-to-bill ratio of 0.9x
  • Generated cash flow from operations of $22.4 million
  • Reduced net debt (defined as total debt less cash) by $17.5 million, including the repayment of $7.0 million of revolver borrowings and the purchase of $6.4 million principal amount of 1.50% convertible senior notes at a discount to par value of 7%
  • Received a 2021 Spotlight on New Technology® Award from the Offshore Technology Conference for our Merlin™ Deepsea Mineral Riser System
  • Ms. Denise Castillo-Rhodes joined our Board of Directors and Audit Committee

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

"Oil States continues to focus its operations in growth areas where adequate returns can be generated. Non-performing product lines continue to be rationalized leading to a more profitable revenue mix. Sequentially, our consolidated revenues increased 16% and Adjusted Consolidated EBITDA grew 64%, supported by stronger commodity prices and demand for offshore production-related equipment, and greater U.S. well completion activity.

"Revenues in our Offshore/Manufactured Products segment increased 27% from the first quarter of 2021 – driven by a 49% increase in project-driven revenues and higher activity across all other product and service offerings. Adjusted Segment EBITDA for Offshore/Manufactured Products improved $3.5 million sequentially to $10.3 million. Backlog totaled $214 million as of June 30, 2021 with quarterly bookings totaling $65 million, yielding book-to-bill ratios of 0.9x for the second quarter and 1.0x year-to-date.

"Second quarter revenues in our Downhole Technologies segment increased 5% sequentially, driven by higher demand for our proprietary completion and perforating products. Our Downhole Technologies segment reported Adjusted Segment EBITDA of $2.4 million in the second quarter.

"Our Well Site Services segment revenues increased 6% from the prior quarter with Adjusted Segment EBITDA of $5.7 million, reflecting revenue growth and our continued cost reduction initiatives.

"We continue to invest in the development and expansion of technologies to serve new markets and industries. In this regard, we were recently recognized by the Offshore Technology Conference with a 2021 Spotlight on New Technology® Award for our Merlin™ Deepsea Mineral Riser System, highlighting the potential to significantly advance the offshore energy sector's participation in a longer-range energy transition. We look forward to supporting growing demand for future deepsea minerals gathering, which is integral to the development of clean energy technologies.

"Finally, I want to thank Jim Nelson and Bill Van Kleef, who both retired from our Board of Directors in May, for their dedicated service, having provided a combined thirty-two years of leadership and strategic guidance to the Company."

BUSINESS SEGMENT RESULTS

(See Segment Data tables)

Offshore/Manufactured Products

Offshore/Manufactured Products reported revenues of $76.9 million and Adjusted Segment EBITDA (Note B) of $10.3 million in the second quarter of 2021, compared to revenues of $60.6 million and Adjusted Segment EBITDA of $6.8 million reported in the first quarter of 2021. Revenues increased 27% sequentially, driven by the recovery in onshore and offshore customer activity, which benefited each of the segment's product and service offerings. Adjusted Segment EBITDA margin in the second quarter of 2021 was 13% compared to 11% in the first quarter of 2021.

Backlog totaled $214 million as of June 30, 2021, a 5% sequential decrease. Second quarter 2021 bookings totaled $65 million, yielding a book-to-bill ratio of 0.9x.

Downhole Technologies

Downhole Technologies reported revenues of $26.8 million and Adjusted Segment EBITDA of $2.4 million in the second quarter of 2021, compared to revenues of $25.4 million and Adjusted Segment EBITDA of $3.0 million reported in the first quarter of 2021. Adjusted Segment EBITDA margin in the second quarter of 2021 was 9% compared to 12% in the first quarter of 2020.

Well Site Services

Well Site Services reported revenues of $42.1 million and Adjusted Segment EBITDA of $5.7 million in the second quarter of 2021, compared to revenues of $39.6 million and Adjusted Segment EBITDA of $4.0 million reported in the first quarter of 2021. Adjusted Segment EBITDA margin the second quarter of 2021 was 14% compared to 10% in the first quarter of 2021.

Corporate

Corporate expenses in the second quarter of 2021 totaled $8.5 million.

Interest Expense, Net

The Company reported net interest expense of $2.7 million in the second quarter of 2021, which included $0.5 million of non-cash amortization of deferred debt issuance costs.

Income Taxes

The Company recognized an effective tax rate benefit of 17% in the second quarter of 2021, which compared to an effective tax rate benefit of 13% in the first quarter of 2021. The effective tax rate benefit in the first quarter of 2021 included the impact of certain discrete tax items.

Financial Condition

As of June 30, 2021, no borrowings were outstanding under the Company's asset-based revolving credit facility (the "ABL Facility"), compared to $7.0 million outstanding as of March 31, 2021. Cash on-hand totaled $62.7 million as of June 30, 2021, compared to $54.5 million as of March 31, 2021. Liquidity (cash plus borrowing availability) totaled $113.0 million as of June 30, 2021 with amounts available to be drawn under the ABL Facility totaling $50.3 million.

During the second quarter of 2021, the Company purchased $6.4 million principal amount of its outstanding 1.50% convertible senior notes due February 2023 ("2023 Notes") for $6.0 million in cash. Since September 2019, the Company has purchased $174.0 million principal amount of its 2023 Notes for $152.8 million in cash.

The Company's total debt represented 20% of combined total debt and stockholders' equity as of June 30, 2021 and December 31, 2020.

Conference Call Information

The call is scheduled for July 29, 2021 at 10:00 a.m. central daylight 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 50199327. 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

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

  Three Months Ended   Six Months Ended
  June 30,
2021
  March 31,
2021
  June 30,
2020
  June 30,
2021
  June 30,
2020
Revenues:                  
Products $ 78,038     $ 61,445     $ 82,643     $ 139,483     $ 185,623  
Services 67,686     64,144     63,602     131,830     180,316  
  145,724     125,589     146,245     271,313     365,939  
                   
Costs and expenses:                  
Product costs 63,926     49,463     68,088     113,389     157,834  
Service costs 53,706     52,847     59,995     106,553     167,851  
Cost of revenues (exclusive of depreciation and amortization expense presented below)(1) 117,632     102,310     128,083     219,942     325,685  
Selling, general and administrative expense 22,092     21,225     23,992     43,317     50,116  
Depreciation and amortization expense 20,909     21,520     24,646     42,429     51,055  
Impairments of goodwill                 406,056  
Impairments of fixed and lease assets 2,794     650     2,992     3,444     8,190  
Other operating income, net (85 )   (354 )   (134 )   (439 )   (27 )
  163,342     145,351     179,579     308,693     841,075  
Operating loss (17,618 )   (19,762 )   (33,334 )   (37,380 )   (475,136 )
                   
Interest expense, net (2,699 )   (2,325 )   (4,179 )   (5,024 )   (7,683 )
Other income, net(2) 1,820     3,960     5,994     5,780     6,768  
Loss before income taxes (18,497 )   (18,127 )   (31,519 )   (36,624 )   (476,051 )
Income tax benefit 3,226     2,317     6,893     5,543     46,384  
Net loss $ (15,271 )   $ (15,810 )   $ (24,626 )   $ (31,081 )   $ (429,667 )
                   
Net loss per share:                  
Basic $ (0.25 )   $ (0.26 )   $ (0.41 )   $ (0.52 )   $ (7.19 )
Diluted $ (0.25 )   $ (0.26 )   $ (0.41 )   $ (0.52 )   $ (7.19 )
                   
Weighted average number of common shares outstanding:                
Basic 60,317     60,098     59,839     60,207     59,747  
Diluted 60,317     60,098     59,839     60,207     59,747  

________________

(1) Cost of revenues (exclusive of depreciation and amortization expense) included non-cash inventory impairment charges of $25.2 million ($12.0 million in product costs and $13.3 million in service costs) recognized in the first quarter of 2020.

(2) Other income, net included non-cash gains of $0.4 million and $4.0 million, respectively, in the three and six months ended June 30, 2021 recognized in connection with purchases of $6.4 million and $131.4 million, respectively, principal amount of the 2023 Notes. In the second quarter of 2020, the Company recognized non-cash gains of $4.8 million in connection with the purchases of $12.0 million principal amount of the 2023 Notes.

OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(In Thousands)

  June 30, 2021   December 31, 2020
  (Unaudited)    
ASSETS      
Current assets:      
Cash and cash equivalents $ 62,650     $ 72,011  
Accounts receivable, net 170,424     163,135  
Inventories, net 175,049     170,376  
Prepaid expenses and other current assets 17,164     18,071  
Total current assets 425,287     423,593  
       
Property, plant, and equipment, net 355,405     383,562  
Operating lease assets, net 29,093     33,140  
Goodwill, net 76,579     76,489  
Other intangible assets, net 195,612     205,749  
Other noncurrent assets 33,748     29,727  
Total assets $ 1,115,724     $ 1,152,260  
       
LIABILITIES AND STOCKHOLDERS' EQUITY      
Current liabilities:      
Current portion of long-term debt $ 18,231     $ 17,778  
Accounts payable 55,574     46,433  
Accrued liabilities 45,388     44,504  
Current operating lease liabilities 7,169     7,620  
Income taxes payable 2,769     2,413  
Deferred revenue 45,210     43,384  
Total current liabilities 174,341     162,132  
       
Long-term debt 160,354     165,759  
Long-term operating lease liabilities 28,186     29,166  
Deferred income taxes 4,860     14,263  
Other noncurrent liabilities 26,049     23,309  
Total liabilities 393,790     394,629  
       
Stockholders' equity:      
Common stock 739     733  
Additional paid-in capital 1,101,959     1,122,945  
Retained earnings 314,479     329,327  
Accumulated other comprehensive loss (69,754 )   (71,385 )
Treasury stock (625,489 )   (623,989 )
Total stockholders' equity 721,934     757,631  
Total liabilities and stockholders' equity $ 1,115,724     $ 1,152,260  

OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)

  Six Months Ended June 30,
  2021   2020
Cash flows from operating activities:      
Net loss $ (31,081 )   $ (429,667 )
Adjustments to reconcile net loss to net cash provided by operating activities:      
Depreciation and amortization expense 42,429     51,055  
Impairments of goodwill     406,056  
Impairments of inventories     25,230  
Impairments of fixed and lease assets 3,444     8,190  
Stock-based compensation expense 4,703     3,257  
Amortization of debt discount and deferred financing costs 1,366     4,067  
Deferred income tax benefit (6,834 )   (48,738 )
Gains on extinguishment of 1.50% convertible senior notes (4,022 )   (4,779 )
Gains on disposals of assets (1,632 )   (1,489 )
Other, net 375     3,177  
Changes in operating assets and liabilities:      
Accounts receivable (6,962 )   56,062  
Inventories (4,458 )   (4,320 )
Accounts payable and accrued liabilities 11,896     (34,227 )
Deferred revenue 1,780     5,991  
Other operating assets and liabilities, net 2,929     4,266  
Net cash flows provided by operating activities 13,933     44,131  
       
Cash flows from investing activities:      
Capital expenditures (7,311 )   (8,915 )
Proceeds from disposition of property and equipment 3,422     5,418  
Other, net (326 )   (301 )
Net cash flows used in investing activities (4,215 )   (3,798 )
       
Cash flows from financing activities:      
Revolving credit facility borrowings 12,571     72,173  
Revolving credit facility repayments (31,571 )   (53,104 )
Issuance of 4.75% convertible senior notes 135,000      
Purchases of 1.50% convertible senior notes (125,952 )   (10,595 )
Other debt and finance lease activity, net 119     (165 )
Payment of financing costs (7,779 )   (651 )
Shares added to treasury stock as a result of net share settlements
due to vesting of stock awards
(1,500 )   (2,667 )
Net cash flows provided by (used in) financing activities (19,112 )   4,991  
       
Effect of exchange rate changes on cash and cash equivalents 33     2  
Net change in cash and cash equivalents (9,361 )   45,326  
Cash and cash equivalents, beginning of period 72,011     8,493  
Cash and cash equivalents, end of period $ 62,650     $ 53,819  
       
Cash paid for:      
Interest $ 2,256     $ 3,486  
Income taxes, net 920     2,888  

OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

SEGMENT DATA
(In Thousands)
(unaudited)

  Three Months Ended   Six Months Ended
  June 30,
2021(2)
  March 31,
2021(3)
  June 30,
2020(4)
  June 30,
2021(5)
  June 30,
2020(6)
Revenues:                  
Offshore/Manufactured Products(1):                  
Project-driven products $ 31,826     $ 21,374     $ 51,365     $ 53,200     $ 88,153  
Short-cycle products 16,030     12,250     11,373     28,280     33,470  
Other products and services 29,052     26,985     32,198     56,037     64,485  
Total Offshore/Manufactured Products 76,908     60,609     94,936     137,517     186,108  
Downhole Technologies 26,760     25,430     14,965     52,190     56,030  
Well Site Services 42,056     39,550     36,344     81,606     123,801  
Total revenues $ 145,724     $ 125,589     $ 146,245     $ 271,313     $ 365,939  
                   
Operating income (loss):                  
Offshore/Manufactured Products $ 4,810     $ 1,071     $ 9,419     $ 5,881     $ (86,077 )
Downhole Technologies (2,295 )   (1,615 )   (11,110 )   (3,910 )   (203,801 )
Well Site Services (11,590 )   (9,853 )   (22,920 )   (21,443 )   (167,874 )
Corporate (8,543 )   (9,365 )   (8,723 )   (17,908 )   (17,384 )
Total operating loss $ (17,618 )   $ (19,762 )   $ (33,334 )   $ (37,380 )   $ (475,136 )

________________

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

(2) Operating income (loss) for the three months ended June 30, 2021 included $0.2 million of restructuring charges related to the Downhole Technologies segment. In the Well Site Services segment, operating income (loss) included non-cash operating lease asset impairment charges of $2.8 million and restructuring charges of $2.4 million.

(3) Operating income (loss) for the three months ended March 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 $0.3 million. In the Well Site Services segment, operating income (loss) included non-cash fixed asset impairment charges of $0.7 million and severance and restructuring charges of $1.3 million. In Corporate, operating income (loss) included $1.6 million of severance charges.

(4) Operating income (loss) for the three months ended June 30, 2020 included $0.3 million of severance charges in the Offshore/Manufactured Products segment. In the Downhole Technologies segment, operating income (loss) included $1.3 million of severance and restructuring charges. In the Well Site Services segment, operating income (loss) included a non-cash fixed asset impairment charge of $3.0 million and severance and restructuring charges of $3.5 million. In Corporate, operating income (loss) included $0.2 million of severance charges.

(5) Operating income (loss) for the six months ended June 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 severance and restructuring charges of $0.5 million. In the Well Site Services segment, operating income (loss) included non-cash fixed asset and operating lease impairment charges of $3.4 million and severance and restructuring charges of $3.7 million. In Corporate, operating income (loss) included $1.6 million of severance charges.

(6) Operating income (loss) for the six months ended June 30, 2020 included a non-cash goodwill impairment charge of $86.5 million, non-cash inventory charges of $16.2 million and $0.4 million of severance 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 and severance and restructuring charges of $1.3 million. 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 $8.2 million and severance and restructuring charges of $4.1 million. In Corporate, operating income (loss) included $0.2 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   Six Months Ended
  June 30,
2021
  March 31,
2021
  June 30,
2020
  June 30,
2021
  June 30,
2020
Offshore/Manufactured Products:                  
Operating income (loss) $ 4,810     $ 1,071     $ 9,419     $ 5,881     $ (86,077 )
Depreciation and amortization expense 5,557     5,469     5,476     11,026     11,104  
Impairment of goodwill                 86,500  
Impairment of inventories                 16,249  
Other income (expense) (70 )   (62 )   113     (132 )   289  
Segment EBITDA 10,297     6,478     15,008     16,775     28,065  
Severance and restructuring charges     282     322     282     434  
Adjusted Segment EBITDA $ 10,297     $ 6,760     $ 15,330     $ 17,057     $ 28,499  
                   
Downhole Technologies:                  
Operating loss $ (2,295 )   $ (1,615 )   $ (11,110 )   $ (3,910 )   $ (203,801 )
Depreciation and amortization expense 4,521     4,389     5,619     8,910     11,203  
Impairment of goodwill                 192,502  
Other expense     (2 )   (13 )   (2 )   (90 )
Segment EBITDA 2,226     2,772     (5,504 )   4,998     (186 )
Severance and restructuring charges 203     275     1,315     478     1,315  
Adjusted Segment EBITDA $ 2,429     $ 3,047     $ (4,189 )   $ 5,476     $ 1,129  
                   
Well Site Services:                  
Operating loss $ (11,590 )   $ (9,853 )   $ (22,920 )   $ (21,443 )   $ (167,874 )
Depreciation and amortization expense 10,642     11,468     13,368     22,110     28,404  
Impairment of goodwill                 127,054  
Impairment of inventories                 8,981  
Impairments of fixed and lease assets 2,794     650     2,992     3,444     8,190  
Other income 1,505     387     1,115     1,892     1,790  
Segment EBITDA 3,351     2,652     (5,445 )   6,003     6,545  
Severance and restructuring charges 2,351     1,306     3,544     3,657     4,092  
Adjusted Segment EBITDA $ 5,702     $ 3,958     $ (1,901 )   $ 9,660     $ 10,637  
                   
Corporate:                  
Operating loss $ (8,543 )   $ (9,365 )   $ (8,723 )   $ (17,908 )   $ (17,384 )
Depreciation and amortization expense 189     194     183     383     344  
EBITDA (8,354 )   (9,171 )   (8,540 )   (17,525 )   (17,040 )
Severance charges     1,555     216     1,555     216  
Adjusted EBITDA $ (8,354 )   $ (7,616 )   $ (8,324 )   $ (15,970 )   $ (16,824 )

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   Six Months Ended
  June 30,
2021
  March 31,
2021
  June 30,
2020
  June 30,
2021
  June 30,
2020
                   
Net loss $ (15,271 )   $ (15,810 )   $ (24,626 )   $ (31,081 )   $ (429,667 )
Income tax benefit (3,226 )   (2,317 )   (6,893 )   (5,543 )   (46,384 )
Depreciation and amortization expense 20,909     21,520     24,646     42,429     51,055  
Impairments of goodwill                 406,056  
Impairments of inventories                 25,230  
Impairments of fixed and lease assets 2,794     650     2,992     3,444     8,190  
Interest expense, net 2,699     2,325     4,179     5,024     7,683  
Gains on extinguishment of 1.50% convertible senior notes (385 )   (3,637 )   (4,779 )   (4,022 )   (4,779 )
Consolidated EBITDA 7,520     2,731     (4,481 )   10,251     17,384  
Severance and restructuring charges 2,554     3,418     5,397     5,972     6,057  
Adjusted Consolidated EBITDA $ 10,074     $ 6,149     $ 916     $ 16,223     $ 23,441  

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(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, gains on extinguishment of 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 depreciation and amortization expense, non-cash asset impairment charges, 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 a supplemental disclosure 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.


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Source: Oil States International, Inc.

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