UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 7, 2019
NEWPARK RESOURCES, INC.
(Exact name of registrant as specified in its charter)
Delaware | 001-02960 | 72-1123385 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||
9320 Lakeside Boulevard, Suite 100 The Woodlands, TX | 77381 | |
(Address of principal executive offices) | (Zip Code) | |
Registrant's telephone number, including area code: (281) 362-6800
Not Applicable |
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
p | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
p | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
p | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
p | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13a-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On February 7, 2019, Newpark Resources, Inc. (the “Company”) issued a press release announcing financial information for the three months and twelve months ended December 31, 2018. The press release is attached to this Current Report on Form 8-K as Exhibit 99.1 and is incorporated herein by reference.
The information in Item 2.02 of this Current Report on Form 8-K and the information in the exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act except as expressly set forth by specific reference in such filing.
Use of Non-GAAP Financial Information
To help understand the Company’s financial performance, the Company has supplemented its financial results that it provides in accordance with generally accepted accounting principles (“GAAP”) with non-GAAP financial measures. Such financial measures include earnings before interest, taxes, depreciation and amortization (“EBITDA”), EBITDA Margin, Net Debt, and the Ratio of Net Debt to Capital.
We believe these non-GAAP financial measures are frequently used by investors, securities analysts and other parties in the evaluation of our performance and/or that of other companies in our industry. In addition, management uses these measures to evaluate operating performance, and our incentive compensation plan measures performance based on our consolidated EBITDA, along with other factors. The methods we use to produce these non-GAAP financial measures may differ from methods used by other companies. These measures should be considered in addition to, not as a substitute for, financial measures prepared in accordance with GAAP. Applicable reconciliations to the nearest GAAP financial measure of each non-GAAP financial measure are included in the attached Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. | Description | |
99.1 | ||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
NEWPARK RESOURCES, INC. | |||
(Registrant) | |||
Date: | February 7, 2019 | By: | /s/ Gregg S. Piontek |
Gregg S. Piontek | |||
Senior Vice President and Chief Financial Officer | |||
(Principal Financial Officer) | |||
Exhibit 99.1
 | NEWS RELEASE | ||
Contacts: | Gregg Piontek Senior Vice President and Chief Financial Officer Newpark Resources, Inc. gpiontek@newpark.com 281-362-6800 | ||
FOR IMMEDIATE RELEASE | |||
NEWPARK RESOURCES REPORTS FOURTH QUARTER 2018 RESULTS
Mats and Integrated Services posts record quarter;
Fluids Systems receives new award in Kuwait
THE WOODLANDS, TX – February 7, 2019 – Newpark Resources, Inc. (NYSE: NR) today announced results for its fourth quarter ended December 31, 2018. Total revenues for the fourth quarter of 2018 were $247.7 million compared to $235.3 million for the third quarter of 2018 and $204.4 million for the fourth quarter of 2017. Income from continuing operations for the fourth quarter of 2018 was $10.6 million, or $0.11 per diluted share, compared to $3.6 million, or $0.04 per diluted share, for the third quarter of 2018, and $7.9 million, or $0.09 per diluted share, for the fourth quarter of 2017. Fourth quarter 2018 results include the impact of the following:
• | $2.0 million of pre-tax charges in the U.S. Fluids Systems business ($1.6 million after-tax) consisting primarily of severance and related charges associated with cost optimization efforts; |
• | $0.5 million of non-capitalizable expenses in the U.S. Fluids Systems business ($0.4 million after-tax) related to the continuation of the completion fluids facility conversion in the Port of Fourchon. With the conclusion of Phase I of this project, the facility is now operational, enabling us to provide both drilling and completion fluids to the deepwater Gulf of Mexico market. |
Combined, the impact of the above items resulted in a $2.5 million reduction in operating income for the quarter and a $2.0 million reduction in income from continuing operations ($0.02 per diluted share).
Paul Howes, Newpark’s President and Chief Executive Officer, stated, “We’re extremely pleased with the performance of our Mats segment in the quarter, and in Fluids, we are seeing meaningful progress in the execution of our long-term strategy, which we believe is setting the course for improvements going forward.
“The Mats & Integrated Services segment achieved a quarterly record of $70 million in revenues in the fourth quarter. The strong fourth quarter results benefited from elevated year-end demand from the utility sector, which contributed to a quarterly record of $24 million of revenues from direct sales. In addition, we experienced strong rental and service demand across industries, benefiting in part from heavy rainfalls in the southern U.S., which contributed to a quarterly record of $46 million of revenues from rental and services,” added Howes. “With the exceptionally strong top line performance, segment operating margin improved to 30%.
“In Fluids Systems, fourth quarter revenues for the segment came in at $178 million, a 2% sequential decrease, driven primarily by the slowdown in Canada and a delay in the start of projects in the deepwater Gulf of Mexico, as planned projects were pushed from the fourth quarter to the first quarter. Internationally,
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revenues were relatively in-line sequentially, as the anticipated declines in Kuwait, Albania, and Brazil were substantially offset by broad-based improvements across other markets,” added Howes. “Despite the modestly softer Fluids Systems revenues, segment operating income remained in line with the prior quarter. As highlighted, the fourth quarter included the impact of $2.5 million of charges, primarily attributable to severance and other charges related to our ongoing cost optimization efforts.
“Benefiting from the stronger operational performance and reductions in working capital, we generated $43 million of cash from operating activities in the fourth quarter, which facilitated a $27 million reduction in outstanding debt in the quarter,” concluded Howes.
Fluids Systems International Contract Award
Following a recent tender process with Kuwait Oil Company, the Company has received notification of two new contract awards to provide drilling and completion fluids, along with related services, covering a five-year term. The initial revenue value of the combined awards is approximately $165 million and expands the Company’s presence to include a second base of operations in Northern Kuwait. The awards remain subject to contract execution, which is expected to be completed in the first quarter of 2019.
Segment Results
The Fluids Systems segment generated revenues of $177.7 million for the fourth quarter of 2018 compared to $181.0 million for the third quarter of 2018 and $162.4 million for the fourth quarter of 2017. Segment operating income was $8.2 million for the fourth quarter of 2018 compared to $8.3 million for the third quarter of 2018 and $7.4 million for the fourth quarter of 2017. Operating income for the fourth quarter of 2018 includes $2.0 million of charges, consisting primarily of severance and related costs and $0.5 million of non-capitalizable expenses related to the conversion of a drilling fluids facility into a completion fluids facility.
The Mats and Integrated Services segment generated revenues of $69.9 million for the fourth quarter of 2018 compared to $54.4 million for the third quarter of 2018 and $42.0 million for the fourth quarter of 2017. Segment operating income was $20.7 million for the fourth quarter of 2018 compared to $12.9 million for the third quarter of 2018 and $11.7 million for the fourth quarter of 2017.
Conference Call
Newpark has scheduled a conference call to discuss fourth quarter 2018 results and its near-term operational outlook, which will be broadcast live over the Internet, on Friday, February 8, 2019 at 10:00 a.m. Eastern Time / 9:00 a.m. Central Time. To participate in the call, dial 412-902-0030 and ask for the Newpark Resources call at least 10 minutes prior to the start time, or access it live over the Internet at www.newpark.com. For those who cannot listen to the live call, a replay will be available through February 22, 2019 and may be accessed by dialing 201-612-7415 and using pass code 13686231#. Also, an archive of the webcast will be available shortly after the call at www.newpark.com for 90 days.
Newpark Resources, Inc. is a worldwide provider of value-added fluids and chemistry solutions in the oilfield, and engineered worksite and access solutions used in various commercial markets. For more information, visit our website at www.newpark.com.
This news release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. All statements that address expectations or projections about the future, including Newpark's strategy for growth, product development, market position, expected expenditures and future financial results are forward-looking statements. Words such as “will,” “may,” “could,” “would,” “should,” “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends,” and similar expressions are intended to identify these forward-looking statements but are not the exclusive means of identifying them. These statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. Many factors, including those discussed more fully elsewhere in this release and in documents filed with the Securities and Exchange Commission by Newpark, particularly its Annual Report on Form 10-K for the year ended December 31, 2017, as well as others, could cause results to differ materially from those expressed in, or implied by, these statements. These
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risk factors include, but are not limited to, risks related to the worldwide oil and natural gas industry, our customer concentration and reliance on the U.S. exploration and production market, risks related to our international operations, our ability to replace existing contracts, the cost and continued availability of borrowed funds including noncompliance with debt covenants, operating hazards present in the oil and natural gas industry, our ability to execute our business strategy and make successful business acquisitions and capital investments, the availability of raw materials or the impact of tariffs on the cost of such raw materials, the availability of skilled personnel, our market competition, our ability to expand our product and service offerings and enter new customer markets with our existing products, compliance with legal and regulatory matters, including environmental regulations, the availability of insurance and the risks and limitations of our insurance coverage, the ongoing impact of the U.S. Tax Cuts and Jobs Act, potential impairments of long-lived intangible assets, technological developments in our industry, risks related to severe weather, particularly in the U.S. Gulf Coast, cybersecurity breaches or business system disruptions and risks related to the fluctuations in the market value of our common stock. Newpark's filings with the Securities and Exchange Commission can be obtained at no charge at www.sec.gov, as well as through our website at www.newpark.com. We assume no obligation to update, amend or clarify publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by securities laws. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this news release might not occur.
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Newpark Resources, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended | Twelve Months Ended | |||||||||||||||||||
(In thousands, except per share data) | December 31, 2018 | September 30, 2018 | December 31, 2017 | December 31, 2018 | December 31, 2017 | |||||||||||||||
Revenues | $ | 247,664 | $ | 235,329 | $ | 204,389 | $ | 946,548 | $ | 747,763 | ||||||||||
Cost of revenues | 197,310 | 194,730 | 165,291 | 766,975 | 607,899 | |||||||||||||||
Selling, general and administrative expenses | 29,645 | 29,820 | 29,541 | 115,127 | 108,838 | |||||||||||||||
Other operating (income) loss, net | 186 | 725 | (283 | ) | 888 | (410 | ) | |||||||||||||
Operating income | 20,523 | 10,054 | 9,840 | 63,558 | 31,436 | |||||||||||||||
Foreign currency exchange (gain) loss | 822 | (89 | ) | 951 | 1,416 | 2,051 | ||||||||||||||
Interest expense, net | 4,205 | 3,668 | 3,028 | 14,864 | 13,273 | |||||||||||||||
Income from continuing operations before income taxes | 15,496 | 6,475 | 5,861 | 47,278 | 16,112 | |||||||||||||||
Provision (benefit) for income taxes | 4,927 | 2,831 | (2,056 | ) | 14,997 | 4,893 | ||||||||||||||
Income from continuing operations | 10,569 | 3,644 | 7,917 | 32,281 | 11,219 | |||||||||||||||
Loss from disposal of discontinued operations, net of tax | — | — | (17,367 | ) | — | (17,367 | ) | |||||||||||||
Net income (loss) | $ | 10,569 | $ | 3,644 | $ | (9,450 | ) | $ | 32,281 | $ | (6,148 | ) | ||||||||
Calculation of EPS: | ||||||||||||||||||||
Income from continuing operations - basic and diluted | $ | 10,569 | $ | 3,644 | $ | 7,917 | $ | 32,281 | $ | 11,219 | ||||||||||
Weighted average common shares outstanding - basic | 90,640 | 90,526 | 87,414 | 89,996 | 85,421 | |||||||||||||||
Dilutive effect of stock options and restricted stock awards | 1,938 | 2,151 | 2,580 | 2,385 | 2,554 | |||||||||||||||
Dilutive effect of 2021 Convertible Notes | — | 905 | — | 544 | — | |||||||||||||||
Weighted average common shares outstanding - diluted | 92,578 | 93,582 | 89,994 | 92,925 | 87,975 | |||||||||||||||
Income per common share - diluted: | ||||||||||||||||||||
Income from continuing operations | $ | 0.11 | $ | 0.04 | $ | 0.09 | $ | 0.35 | $ | 0.13 | ||||||||||
Loss from discontinued operations | — | — | (0.20 | ) | — | (0.20 | ) | |||||||||||||
Net income (loss) | $ | 0.11 | $ | 0.04 | $ | (0.11 | ) | $ | 0.35 | $ | (0.07 | ) | ||||||||
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Newpark Resources, Inc.
Operating Segment Results
(Unaudited)
Three Months Ended | Twelve Months Ended | |||||||||||||||||||
(In thousands) | December 31, 2018 | September 30, 2018 | December 31, 2017 | December 31, 2018 | December 31, 2017 | |||||||||||||||
Revenues | ||||||||||||||||||||
Fluids systems | $ | 177,726 | $ | 180,970 | $ | 162,404 | $ | 715,813 | $ | 615,803 | ||||||||||
Mats and integrated services | 69,938 | 54,359 | 41,985 | 230,735 | 131,960 | |||||||||||||||
Total revenues | $ | 247,664 | $ | 235,329 | $ | 204,389 | $ | 946,548 | $ | 747,763 | ||||||||||
Operating income (loss) | ||||||||||||||||||||
Fluids systems | $ | 8,245 | $ | 8,288 | $ | 7,435 | $ | 40,337 | $ | 27,580 | ||||||||||
Mats and integrated services | 20,740 | 12,925 | 11,729 | 60,604 | 40,491 | |||||||||||||||
Corporate office | (8,462 | ) | (11,159 | ) | (9,324 | ) | (37,383 | ) | (36,635 | ) | ||||||||||
Operating income | $ | 20,523 | $ | 10,054 | $ | 9,840 | $ | 63,558 | $ | 31,436 | ||||||||||
Segment operating margin | ||||||||||||||||||||
Fluids systems | 4.6 | % | 4.6 | % | 4.6 | % | 5.6 | % | 4.5 | % | ||||||||||
Mats and integrated services | 29.7 | % | 23.8 | % | 27.9 | % | 26.3 | % | 30.7 | % | ||||||||||
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Newpark Resources, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands, except share data) | December 31, 2018 | December 31, 2017 | |||||
ASSETS | |||||||
Cash and cash equivalents | $ | 56,118 | $ | 56,352 | |||
Receivables, net | 254,394 | 265,866 | |||||
Inventories | 196,896 | 165,336 | |||||
Prepaid expenses and other current assets | 15,904 | 17,483 | |||||
Total current assets | 523,312 | 505,037 | |||||
Property, plant and equipment, net | 316,293 | 315,320 | |||||
Goodwill | 43,832 | 43,620 | |||||
Other intangible assets, net | 25,160 | 30,004 | |||||
Deferred tax assets | 4,516 | 4,753 | |||||
Other assets | 2,741 | 3,982 | |||||
Total assets | $ | 915,854 | $ | 902,716 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current debt | $ | 2,522 | $ | 1,518 | |||
Accounts payable | 90,607 | 88,648 | |||||
Accrued liabilities | 48,797 | 68,248 | |||||
Total current liabilities | 141,926 | 158,414 | |||||
Long-term debt, less current portion | 159,225 | 158,957 | |||||
Deferred tax liabilities | 37,486 | 31,580 | |||||
Other noncurrent liabilities | 7,536 | 6,285 | |||||
Total liabilities | 346,173 | 355,236 | |||||
Common stock, $0.01 par value (200,000,000 shares authorized and 106,362,991 and 104,571,839 shares issued, respectively) | 1,064 | 1,046 | |||||
Paid-in capital | 617,276 | 603,849 | |||||
Accumulated other comprehensive loss | (67,673 | ) | (53,219 | ) | |||
Retained earnings | 148,802 | 123,375 | |||||
Treasury stock, at cost (15,530,952 and 15,366,504 shares, respectively) | (129,788 | ) | (127,571 | ) | |||
Total stockholders’ equity | 569,681 | 547,480 | |||||
Total liabilities and stockholders' equity | $ | 915,854 | $ | 902,716 | |||
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Newpark Resources, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Twelve Months Ended December 31, | |||||||
(In thousands) | 2018 | 2017 | |||||
Cash flows from operating activities: | |||||||
Net income | $ | 32,281 | $ | (6,148 | ) | ||
Adjustments to reconcile net income to net cash provided by operations: | |||||||
Depreciation and amortization | 45,899 | 39,757 | |||||
Stock-based compensation expense | 10,361 | 10,843 | |||||
Provision for deferred income taxes | 236 | (10,350 | ) | ||||
Net provision for doubtful accounts | 2,849 | 1,481 | |||||
Loss on sale of a business | — | 21,983 | |||||
Gain on sale of assets | (1,821 | ) | (5,478 | ) | |||
Gain on insurance recovery | (606 | ) | — | ||||
Amortization of original issue discount and debt issuance costs | 5,510 | 5,345 | |||||
Change in assets and liabilities: | |||||||
(Increase) decrease in receivables | (7,388 | ) | (73,722 | ) | |||
(Increase) decrease in inventories | (30,352 | ) | (15,097 | ) | |||
(Increase) decrease in other assets | 1,055 | 986 | |||||
Increase (decrease) in accounts payable | 2,449 | 14,153 | |||||
Increase (decrease) in accrued liabilities and other | 2,930 | 54,628 | |||||
Net cash provided by operating activities | 63,403 | 38,381 | |||||
Cash flows from investing activities: | |||||||
Capital expenditures | (45,141 | ) | (31,371 | ) | |||
Refund of proceeds from sale of a business | (13,974 | ) | — | ||||
Proceeds from sale of property, plant and equipment | 2,612 | 7,747 | |||||
Proceeds from insurance property claim | 1,000 | — | |||||
Business acquisitions, net of cash acquired | (249 | ) | (44,750 | ) | |||
Net cash used in investing activities | (55,752 | ) | (68,374 | ) | |||
Cash flows from financing activities: | |||||||
Borrowings on lines of credit | 347,613 | 176,267 | |||||
Payments on lines of credit | (352,582 | ) | (93,700 | ) | |||
Payment on 2017 Convertible Notes | — | (83,252 | ) | ||||
Debt issuance costs | (149 | ) | (955 | ) | |||
Proceeds from employee stock plans | 3,874 | 2,424 | |||||
Purchases of treasury stock | (3,870 | ) | (3,239 | ) | |||
Other financing activities | 601 | 165 | |||||
Net cash used in financing activities | (4,513 | ) | (2,290 | ) | |||
Effect of exchange rate changes on cash | (4,332 | ) | 2,444 | ||||
Net decrease in cash, cash equivalents, and restricted cash | (1,194 | ) | (29,839 | ) | |||
Cash, cash equivalents, and restricted cash at beginning of period | 65,460 | 95,299 | |||||
Cash, cash equivalents, and restricted cash at end of period | $ | 64,266 | $ | 65,460 | |||
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Newpark Resources, Inc.
Non-GAAP Reconciliations
(Unaudited)
To help understand the Company’s financial performance, the Company has supplemented its financial results that it provides in accordance with generally accepted accounting principles (“GAAP”) with non-GAAP financial measures. Such financial measures include earnings before interest, taxes, depreciation and amortization (“EBITDA”), EBITDA Margin, Net Debt and the Ratio of Net Debt to Capital.
We believe these non-GAAP financial measures are frequently used by investors, securities analysts and other parties in the evaluation of our performance and/or that of other companies in our industry. In addition, management uses these measures to evaluate operating performance, and our incentive compensation plan measures performance based on our consolidated EBITDA, along with other factors. The methods we use to produce these non-GAAP financial measures may differ from methods used by other companies. These measures should be considered in addition to, not as a substitute for, financial measures prepared in accordance with GAAP.
Consolidated | Three Months Ended | Twelve Months Ended | |||||||||||||||||
(In thousands) | December 31, 2018 | September 30, 2018 | December 31, 2017 | December 31, 2018 | December 31, 2017 | ||||||||||||||
Net income (loss) (GAAP) (1) | $ | 10,569 | $ | 3,644 | $ | (9,450 | ) | $ | 32,281 | $ | (6,148 | ) | |||||||
Loss from disposal of discontinued operations, net of tax | — | — | 17,367 | — | 17,367 | ||||||||||||||
Interest expense, net | 4,205 | 3,668 | 3,028 | 14,864 | 13,273 | ||||||||||||||
Provision (benefit) for income taxes | 4,927 | 2,831 | (2,056 | ) | 14,997 | 4,893 | |||||||||||||
Depreciation and amortization | 11,553 | 11,591 | 10,759 | 45,899 | 39,757 | ||||||||||||||
EBITDA (non-GAAP) (1) | $ | 31,254 | $ | 21,734 | $ | 19,648 | $ | 108,041 | $ | 69,142 | |||||||||
(1) | Net income and EBITDA for the three months ended December 31, 2018 include $2.0 million of charges, consisting primarily of severance costs and $0.5 million of non-capitalizable expenses related to the conversion of a drilling fluids facility into a completion fluids facility. Net income and EBITDA for the three months ended September 30, 2018 include a corporate office charge of $1.8 million related to the retirement and transition of our Senior Vice President, General Counsel and Chief Administrative Officer, $1.1 million of charges in Brazil primarily related to severance costs associated with our planned workforce reductions in the fourth quarter of 2018 in connection with the scheduled completion of the current contract with Petrobras, $0.8 million of charges related to the July 2018 fire at our Kenedy, Texas drilling fluids facility, and $0.6 million of non-capitalizable expenses related to the conversion of a drilling fluids facility into a completion fluids facility. The impact of these items to net income and EBITDA was $6.8 million for the twelve months ended December 31, 2018. |
Fluids Systems | Three Months Ended | Twelve Months Ended | |||||||||||||||||
(In thousands) | December 31, 2018 | September 30, 2018 | December 31, 2017 | December 31, 2018 | December 31, 2017 | ||||||||||||||
Operating income (GAAP) (1) | $ | 8,245 | $ | 8,288 | $ | 7,435 | $ | 40,337 | $ | 27,580 | |||||||||
Depreciation and amortization | 5,137 | 5,178 | 5,344 | 20,922 | 21,566 | ||||||||||||||
EBITDA (non-GAAP) (1) | 13,382 | 13,466 | 12,779 | 61,259 | 49,146 | ||||||||||||||
Revenues | 177,726 | 180,970 | 162,404 | 715,813 | 615,803 | ||||||||||||||
Operating Margin (GAAP) | 4.6 | % | 4.6 | % | 4.6 | % | 5.6 | % | 4.5 | % | |||||||||
EBITDA Margin (non-GAAP) | 7.5 | % | 7.4 | % | 7.9 | % | 8.6 | % | 8.0 | % | |||||||||
(1) | Operating income and EBITDA for the three months ended December 31, 2018 include $2.0 million of charges, consisting primarily of severance costs and $0.5 million of non-capitalizable expenses related to the conversion of a drilling fluids facility into a completion fluids facility. Operating income and EBITDA for the three months ended September 30, 2018 include $1.1 million of charges in Brazil primarily related to severance costs associated with our planned workforce reductions in the fourth quarter of 2018 in connection with the scheduled completion of the current contract with Petrobras, $0.8 million of charges associated with the July 2018 fire at our Kenedy, Texas drilling fluids facility, and $0.6 million of non-capitalizable expenses related to the conversion of a drilling fluids facility into a completion fluids facility. The impact of these items to operating income and EBITDA was $4.9 million for the twelve months ended December 31, 2018. |
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Newpark Resources, Inc.
Non-GAAP Reconciliations (Continued)
(Unaudited)
Mats and Integrated Services | Three Months Ended | Twelve Months Ended | |||||||||||||||||
(In thousands) | December 31, 2018 | September 30, 2018 | December 31, 2017 | December 31, 2018 | December 31, 2017 | ||||||||||||||
Operating income (GAAP) | $ | 20,740 | $ | 12,925 | $ | 11,729 | $ | 60,604 | $ | 40,491 | |||||||||
Depreciation and amortization | 5,533 | 5,427 | 4,578 | 21,321 | 14,991 | ||||||||||||||
EBITDA (non-GAAP) | 26,273 | 18,352 | 16,307 | 81,925 | 55,482 | ||||||||||||||
Revenues | 69,938 | 54,359 | 41,985 | 230,735 | 131,960 | ||||||||||||||
Operating Margin (GAAP) | 29.7 | % | 23.8 | % | 27.9 | % | 26.3 | % | 30.7 | % | |||||||||
EBITDA Margin (non-GAAP) | 37.6 | % | 33.8 | % | 38.8 | % | 35.5 | % | 42.0 | % | |||||||||
Ratio of Net Debt to Capital
The following table reconciles the Company’s ratio of total debt to capital calculated in accordance with GAAP to the non-GAAP financial measure of the Company’s ratio of net debt to capital:
(In thousands) | December 31, 2018 | December 31, 2017 | |||||
Current debt | $ | 2,522 | $ | 1,518 | |||
Long-term debt, less current portion | 159,225 | 158,957 | |||||
Total Debt | 161,747 | 160,475 | |||||
Total stockholders' equity | 569,681 | 547,480 | |||||
Total Capital | $ | 731,428 | $ | 707,955 | |||
Ratio of Total Debt to Capital | 22.1 | % | 22.7 | % | |||
Total Debt | $ | 161,747 | $ | 160,475 | |||
Less: cash and cash equivalents | (56,118 | ) | (56,352 | ) | |||
Net Debt | 105,629 | 104,123 | |||||
Total stockholders' equity | 569,681 | 547,480 | |||||
Total Capital, Net of Cash | $ | 675,310 | $ | 651,603 | |||
Ratio of Net Debt to Capital | 15.6 | % | 16.0 | % | |||
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