Delaware | 001-33816 | 26-0287117 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
¨ | 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 |
Item 9.01 | Financial Statements and Exhibits |
Exhibit Number | Description | ||
99.1 | Press Release, dated March 5, 2018 |
Exhibit Number | Description | ||
99.1 |
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. | ||||||
Date: March 5, 2018 | By: | /s/ Joseph M. Crabb | ||||
Name: | Joseph M. Crabb | |||||
Title: | Executive Vice President and Chief Legal Officer |
• | Fourth quarter revenue was $46.4 million, an increase of approximately 29.8%, or $10.6 million, when compared with $35.8 million in the fourth quarter of 2016. |
• | Net loss for the fourth quarter was $30.9 million, a reduction of $30.4 million, or approximately 49.6%, when compared with a net loss of $61.3 million in the fourth quarter of 2016. |
• | Loss from continuing operations, adjusted for special items, for the fourth quarter was $17.3 million, compared with $26.0 million in the fourth quarter of 2016. |
• | Adjusted EBITDA from continuing operations for the fourth quarter was $5.1 million, an increase of $2.6 million compared with $2.5 million in the fourth quarter of 2016. |
• | Fourth quarter Adjusted EBITDA margin improved by 400 basis points. |
• | Total liquidity as of December 31, 2017 was $20.5 million. |
Successor | Predecessor | |||||||
Three Months Ended | Three Months Ended | |||||||
December 31, | December 31, | |||||||
2017 | 2016 | |||||||
Revenue: | ||||||||
Service revenue | $ | 41,775 | $ | 32,348 | ||||
Rental revenue | 4,655 | 3,434 | ||||||
Total revenue | 46,430 | 35,782 | ||||||
Costs and expenses: | ||||||||
Direct operating expenses | 40,967 | 28,602 | ||||||
General and administrative expenses | 5,687 | 9,034 | ||||||
Depreciation and amortization | 21,230 | 14,693 | ||||||
Impairment of long-lived assets | 2,500 | 31,712 | ||||||
Total costs and expenses | 70,384 | 84,041 | ||||||
Loss from operations | (23,954 | ) | (48,259 | ) | ||||
Interest expense, net | (1,409 | ) | (13,856 | ) | ||||
Other income, net | 117 | 754 | ||||||
Reorganization items, net | (6,037 | ) | — | |||||
Loss before income taxes | (31,283 | ) | (61,361 | ) | ||||
Income tax benefit | 381 | 45 | ||||||
Net loss | $ | (30,902 | ) | $ | (61,316 | ) | ||
Earnings per common share: | ||||||||
Net loss per basic common share | $ | (2.64 | ) | $ | (0.45 | ) | ||
Net loss per diluted common share | $ | (2.64 | ) | $ | (0.45 | ) | ||
Weighted average shares outstanding: | ||||||||
Basic | 11,696 | 137,702 | ||||||
Diluted | 11,696 | 137,702 |
Successor | Predecessor | |||||||||||
Five Months Ended | Seven Months Ended | Year Ended | ||||||||||
December 31, 2017 | July 31, 2017 | December 31, 2016 | ||||||||||
Revenue: | ||||||||||||
Service revenue | $ | 72,395 | $ | 86,564 | $ | 139,886 | ||||||
Rental revenue | 7,793 | 9,319 | 12,290 | |||||||||
Total revenue | 80,188 | 95,883 | 152,176 | |||||||||
Costs and expenses: | ||||||||||||
Direct operating expenses | 67,077 | 81,010 | 129,624 | |||||||||
General and administrative expenses | 10,615 | 22,552 | 37,013 | |||||||||
Depreciation and amortization | 38,551 | 28,981 | 60,763 | |||||||||
Impairment of long-lived assets | 4,904 | — | 42,164 | |||||||||
Total costs and expenses | 121,147 | 132,543 | 269,564 | |||||||||
Operating loss | (40,959 | ) | (36,660 | ) | (117,388 | ) | ||||||
Interest expense, net | (2,187 | ) | (22,792 | ) | (54,530 | ) | ||||||
Other income, net | 411 | 4,247 | 5,778 | |||||||||
Loss on extinguishment of debt | — | — | (674 | ) | ||||||||
Reorganization items, net | (5,507 | ) | 223,494 | — | ||||||||
(Loss) income from continuing operations before income taxes | (48,242 | ) | 168,289 | (166,814 | ) | |||||||
Income tax benefit (expense) | 347 | 322 | (807 | ) | ||||||||
(Loss) income from continuing operations | (47,895 | ) | 168,611 | (167,621 | ) | |||||||
Loss from discontinued operations, net of income taxes | — | — | (1,235 | ) | ||||||||
Net (loss) income | $ | (47,895 | ) | $ | 168,611 | $ | (168,856 | ) | ||||
Earnings per common share: | ||||||||||||
Basic (loss) income from continuing operations | $ | (4.09 | ) | $ | 1.12 | $ | (1.84 | ) | ||||
Basic loss from discontinued operations | — | — | (0.01 | ) | ||||||||
Net (loss) income per basic common share | $ | (4.09 | ) | $ | 1.12 | $ | (1.85 | ) | ||||
Diluted (loss) income from continuing operations | $ | (4.09 | ) | $ | 0.97 | $ | (1.84 | ) | ||||
Diluted loss from discontinued operations | — | — | (0.01 | ) | ||||||||
Net (loss) income per diluted common share | $ | (4.09 | ) | $ | 0.97 | $ | (1.85 | ) | ||||
Weighted average shares outstanding: | ||||||||||||
Basic | 11,696 | 150,940 | 90,979 | |||||||||
Diluted | 11,696 | 174,304 | 90,979 |
Successor | Predecessor | |||||||
December 31, | December 31, | |||||||
2017 | 2016 | |||||||
Assets | ||||||||
Cash and cash equivalents | $ | 5,488 | $ | 994 | ||||
Restricted cash | 1,296 | 1,420 | ||||||
Accounts receivable, net | 30,965 | 23,795 | ||||||
Inventories | 4,089 | 2,464 | ||||||
Prepaid expenses and other receivables | 8,594 | 3,516 | ||||||
Other current assets | 226 | 107 | ||||||
Assets held for sale | 2,765 | 1,182 | ||||||
Total current assets | 53,423 | 33,478 | ||||||
Property, plant and equipment, net | 229,874 | 294,179 | ||||||
Equity investments | 48 | 73 | ||||||
Intangibles, net | 547 | 14,310 | ||||||
Goodwill | 27,139 | — | ||||||
Deferred income taxes | 84 | — | ||||||
Other assets | 207 | 564 | ||||||
Total assets | $ | 311,322 | $ | 342,604 | ||||
Liabilities and Shareholders’ Equity | ||||||||
Accounts payable | $ | 7,946 | $ | 4,047 | ||||
Accrued liabilities | 13,939 | 18,787 | ||||||
Current contingent consideration | 500 | — | ||||||
Current portion of long-term debt | 5,525 | 465,835 | ||||||
Derivative warrant liability | 477 | 4,298 | ||||||
Total current liabilities | 28,387 | 492,967 | ||||||
Deferred income taxes | — | 495 | ||||||
Long-term debt | 33,524 | 5,956 | ||||||
Long-term contingent consideration | — | 8,500 | ||||||
Other long-term liabilities | 6,438 | 3,752 | ||||||
Total liabilities | 68,349 | 511,670 | ||||||
Commitments and contingencies | ||||||||
Shareholders’ equity (deficit): | ||||||||
Common stock | 117 | 152 | ||||||
Additional paid-in capital | 290,751 | 1,407,867 | ||||||
Treasury stock | — | (19,807 | ) | |||||
Accumulated deficit | (47,895 | ) | (1,557,278 | ) | ||||
Total shareholders’ equity (deficit) | 242,973 | (169,066 | ) | |||||
Total liabilities and shareholders’ equity | $ | 311,322 | $ | 342,604 |
Successor | Predecessor | |||||||||||
Five Months Ended | Seven Months Ended | Year Ended | ||||||||||
December 31, | July 31, | December 31, | ||||||||||
2017 | 2017 | 2016 | ||||||||||
Cash flows from operating activities: | ||||||||||||
Net (loss) income | $ | (47,895 | ) | $ | 168,611 | $ | (168,856 | ) | ||||
Adjustments to reconcile net (loss) income to net cash used in operating activities: | ||||||||||||
Loss on the sale of TFI | — | — | 1,235 | |||||||||
Depreciation and amortization of intangible assets | 38,551 | 28,981 | 60,763 | |||||||||
Amortization of debt issuance costs, net | — | 2,135 | 6,165 | |||||||||
Accrued interest added to debt principal | 473 | 11,474 | 26,684 | |||||||||
Stock-based compensation | 677 | 457 | 1,125 | |||||||||
Impairment of long-lived assets | 4,904 | — | 42,164 | |||||||||
Gain on sale of UGSI | (76 | ) | — | (1,747 | ) | |||||||
Loss (gain) on disposal of property, plant and equipment | 5,695 | (258 | ) | 3,512 | ||||||||
Bad debt expense | 91 | 788 | (283 | ) | ||||||||
Change in fair value of derivative warrant liability | (239 | ) | (4,025 | ) | (3,311 | ) | ||||||
Loss on extinguishment of debt | — | — | 674 | |||||||||
Deferred income taxes | (242 | ) | (337 | ) | 225 | |||||||
Other, net | 4,503 | (11,295 | ) | 560 | ||||||||
Reorganization items, non-cash | — | (218,600 | ) | — | ||||||||
Changes in operating assets and liabilities: | ||||||||||||
Accounts receivable | (3,521 | ) | (4,528 | ) | 18,676 | |||||||
Prepaid expenses and other receivables | (312 | ) | 472 | (285 | ) | |||||||
Accounts payable and accrued liabilities | (5,034 | ) | 3,682 | (13,507 | ) | |||||||
Other assets and liabilities, net | (4,036 | ) | 3,494 | (45 | ) | |||||||
Net cash used in operating activities | (6,461 | ) | (18,949 | ) | (26,251 | ) | ||||||
Cash flows from investing activities: | ||||||||||||
Proceeds from the sale of property, plant and equipment | 4,034 | 3,083 | 10,696 | |||||||||
Purchases of property, plant and equipment | (2,231 | ) | (3,149 | ) | (3,826 | ) | ||||||
Proceeds from the sale of UGSI | 76 | — | 5,032 | |||||||||
Change in restricted cash | 6,509 | (6,385 | ) | 2,830 | ||||||||
Net cash provided by (used in) investing activities | 8,388 | (6,451 | ) | 14,732 | ||||||||
Cash flows from financing activities: | ||||||||||||
Proceeds from Predecessor revolving credit facility | — | 106,785 | 154,514 | |||||||||
Payments on Predecessor revolving credit facility | — | (129,964 | ) | (233,667 | ) | |||||||
Proceeds from Predecessor term loan | — | 15,700 | 55,000 | |||||||||
Proceeds from debtor in possession term loan | — | 6,875 | — | |||||||||
Proceeds from Successor First and Second Lien Term Loans | — | 36,053 | — | |||||||||
Payments on Successor First and Second Lien Term Loans | (1,241 | ) | — | — | ||||||||
Proceeds from Successor revolving facility | 79,464 | — | — | |||||||||
Payments on Successor revolving facility | (79,464 | ) | — | — | ||||||||
Payments for debt issuance costs | — | (1,053 | ) | (1,029 | ) | |||||||
Issuance of stock | — | — | 5,000 | |||||||||
Payments on vehicle financing and other financing activities | (2,391 | ) | (2,797 | ) | (6,614 | ) | ||||||
Net cash (used in) provided by financing activities | (3,632 | ) | 31,599 | (26,796 | ) | |||||||
Net (decrease) increase in cash and cash equivalents | (1,705 | ) | 6,199 | (38,315 | ) | |||||||
Cash and cash equivalents - beginning of period | 7,193 | 994 | 39,309 | |||||||||
Cash and cash equivalents - end of period | $ | 5,488 | $ | 7,193 | $ | 994 |
Three Months Ended | Year Ended | ||||||||||||||
December 31, | December 31, | ||||||||||||||
2017 | 2016 | 2017 [1] | 2016 | ||||||||||||
(Loss) income from continuing operations | $ | (30,902 | ) | $ | (61,316 | ) | $ | 120,716 | $ | (167,621 | ) | ||||
Depreciation and amortization | 21,230 | 14,693 | 67,532 | 60,763 | |||||||||||
Interest expense, net | 1,409 | 13,856 | 24,979 | 54,530 | |||||||||||
Income tax (benefit) expense | (381 | ) | (45 | ) | (669 | ) | 807 | ||||||||
EBITDA | (8,644 | ) | (32,812 | ) | 212,558 | (51,521 | ) | ||||||||
Adjustments: | |||||||||||||||
Transaction-related costs, including earnout adjustments, net | — | — | — | (117 | ) | ||||||||||
Stock-based compensation | 496 | 217 | 1,134 | 1,125 | |||||||||||
Change in fair value of derivative warrant liability | (379 | ) | (737 | ) | (4,264 | ) | (3,311 | ) | |||||||
Capital reorganization costs [2] | — | 4,033 | 9,448 | 14,310 | |||||||||||
Reorganization items, net [3] | 6,036 | — | (217,987 | ) | — | ||||||||||
Legal and environmental costs, net | 124 | (99 | ) | 2,168 | 3,128 | ||||||||||
Impairment of long-lived assets | 2,500 | 31,712 | 4,904 | 42,164 | |||||||||||
Restructuring, exit and other costs | — | — | — | (379 | ) | ||||||||||
Loss on extinguishment of debt | — | — | — | 674 | |||||||||||
Gain on the sale of UGSI | — | — | (76 | ) | (1,747 | ) | |||||||||
Loss on disposal of assets | 5,008 | 219 | 5,437 | 3,512 | |||||||||||
Total Adjusted EBITDA | $ | 5,141 | $ | 2,533 | $ | 13,322 | $ | 7,838 |
[1] | For illustrative purposes, the Company has combined the Successor and Predecessor periods to derive combined results for the year ended December 31, 2017. |
[2] | Capital reorganization costs in 2017 represent costs related to the chapter 11 filing incurred prior to the May 1, 2017 filing date. Capital reorganization costs in 2016 represent costs incurred for the debt exchange executed in 2016. |
[3] | Reorganization items, net represents the costs related to the chapter 11 filing incurred after the May 1, 2017 filing date. |
Three months ended December 31, 2017 | Rocky Mountain | Northeast | Southern | Corporate | Total | |||||||||||||||
Revenue | $ | 25,920 | $ | 10,075 | $ | 10,435 | $ | — | $ | 46,430 | ||||||||||
Direct operating expenses | 24,457 | 8,874 | 7,636 | — | 40,967 | |||||||||||||||
General and administrative expenses | 1,362 | 696 | 745 | 2,884 | 5,687 | |||||||||||||||
Depreciation and amortization | 10,088 | 5,982 | 5,112 | 48 | 21,230 | |||||||||||||||
Loss from operations | (12,487 | ) | (5,477 | ) | (3,058 | ) | (2,932 | ) | (23,954 | ) | ||||||||||
Operating margin % | (48.2 | )% | (54.4 | )% | (29.3 | )% | NA | (51.6 | )% | |||||||||||
Reorganization items, net | (464 | ) | (42 | ) | (63 | ) | (5,468 | ) | (6,037 | ) | ||||||||||
Loss from continuing operations before income taxes | (13,029 | ) | (5,792 | ) | (3,362 | ) | (9,100 | ) | (31,283 | ) | ||||||||||
Loss from continuing operations | (13,029 | ) | (5,791 | ) | (3,361 | ) | (8,721 | ) | (30,902 | ) | ||||||||||
Depreciation and amortization | 10,088 | 5,982 | 5,112 | 48 | 21,230 | |||||||||||||||
Interest expense, net | 102 | 113 | 114 | 1,080 | 1,409 | |||||||||||||||
Income tax benefit | — | (1 | ) | (1 | ) | (379 | ) | (381 | ) | |||||||||||
EBITDA | $ | (2,839 | ) | $ | 303 | $ | 1,864 | $ | (7,972 | ) | $ | (8,644 | ) | |||||||
Adjustments, net | 7,026 | 97 | 1,095 | 5,567 | 13,785 | |||||||||||||||
Adjusted EBITDA from continuing operations | $ | 4,187 | $ | 400 | $ | 2,959 | $ | (2,405 | ) | $ | 5,141 | |||||||||
Adjusted EBITDA margin % | 16.2 | % | 4.0 | % | 28.4 | % | NA | 11.1 | % |
Three months ended December 31, 2016 | Rocky Mountain | Northeast | Southern | Corporate | Total | |||||||||||||||
Revenue | $ | 19,541 | $ | 8,104 | $ | 8,137 | $ | — | $ | 35,782 | ||||||||||
Direct operating expenses | 15,386 | 7,668 | 5,548 | — | 28,602 | |||||||||||||||
General and administrative expenses | 1,193 | 757 | 603 | 6,481 | 9,034 | |||||||||||||||
Depreciation and amortization | 8,073 | 2,856 | 3,705 | 59 | 14,693 | |||||||||||||||
Loss from operations | (36,823 | ) | (3,177 | ) | (1,719 | ) | (6,540 | ) | (48,259 | ) | ||||||||||
Operating margin % | (188.4 | )% | (39.2 | )% | (21.1 | )% | NA | (134.9 | )% | |||||||||||
Loss from continuing operations before income taxes | (36,863 | ) | (3,242 | ) | (1,725 | ) | (19,531 | ) | (61,361 | ) | ||||||||||
Loss from continuing operations | (36,863 | ) | (3,241 | ) | (1,724 | ) | (19,488 | ) | (61,316 | ) | ||||||||||
Depreciation and amortization | 8,073 | 2,856 | 3,705 | 59 | 14,693 | |||||||||||||||
Interest expense, net | 57 | 64 | 7 | 13,728 | 13,856 | |||||||||||||||
Income tax benefit | — | (1 | ) | (1 | ) | (43 | ) | (45 | ) | |||||||||||
EBITDA | $ | (28,733 | ) | $ | (322 | ) | $ | 1,987 | $ | (5,744 | ) | $ | (32,812 | ) | ||||||
Adjustments, net | 31,701 | 97 | 79 | 3,468 | 35,345 | |||||||||||||||
Adjusted EBITDA from continuing operations | $ | 2,968 | $ | (225 | ) | $ | 2,066 | $ | (2,276 | ) | $ | 2,533 | ||||||||
Adjusted EBITDA margin % | 15.2 | % | (2.8 | )% | 25.4 | % | NA | 7.1 | % |
Year Ended December 31, 2017 [1] | Rocky Mountain | Northeast | Southern | Corporate | Total | |||||||||||||||
Revenue | $ | 103,033 | $ | 37,985 | $ | 35,053 | $ | — | $ | 176,071 | ||||||||||
Direct operating expenses | 87,073 | 35,953 | 25,061 | — | 148,087 | |||||||||||||||
General and administrative expenses | 6,517 | 3,073 | 3,258 | 20,319 | 33,167 | |||||||||||||||
Depreciation and amortization | 34,072 | 16,168 | 17,075 | 217 | 67,532 | |||||||||||||||
Loss from operations | (29,295 | ) | (17,209 | ) | (10,579 | ) | (20,536 | ) | (77,619 | ) | ||||||||||
Operating margin % | (28.4 | )% | (45.3 | )% | (30.2 | )% | NA | (44.1 | )% | |||||||||||
Reorganization items, net | (5,597 | ) | 27,902 | 22,360 | 173,322 | 217,987 | ||||||||||||||
(Loss) income from continuing operations before income taxes | (35,073 | ) | 10,375 | 11,544 | 133,201 | 120,047 | ||||||||||||||
(Loss) income from continuing operations | (35,073 | ) | 10,376 | 11,545 | 133,868 | 120,716 | ||||||||||||||
Depreciation and amortization | 34,072 | 16,168 | 17,075 | 217 | 67,532 | |||||||||||||||
Interest expense, net | 363 | 333 | 257 | 24,026 | 24,979 | |||||||||||||||
Income tax benefit | — | (1 | ) | (1 | ) | (667 | ) | (669 | ) | |||||||||||
EBITDA | $ | (638 | ) | $ | 26,876 | $ | 28,876 | $ | 157,444 | $ | 212,558 | |||||||||
Adjustments, net | 15,542 | (27,258 | ) | (20,694 | ) | (166,826 | ) | (199,236 | ) | |||||||||||
Adjusted EBITDA from continuing operations | $ | 14,904 | $ | (382 | ) | $ | 8,182 | $ | (9,382 | ) | $ | 13,322 | ||||||||
Adjusted EBITDA margin % | 14.5 | % | (1.0 | )% | 23.3 | % | NA | 7.6 | % |
[1] | For illustrative purposes, the Company has combined the Successor and Predecessor periods to derive combined results for the year ended December 31, 2017. |
Year Ended December 31, 2016 | Rocky Mountain | Northeast | Southern | Corporate | Total | |||||||||||||||
Revenue | $ | 82,564 | $ | 36,446 | $ | 33,166 | $ | — | $ | 152,176 | ||||||||||
Direct operating expenses | 65,066 | 36,673 | 27,885 | — | 129,624 | |||||||||||||||
General and administrative expenses | 5,951 | 2,632 | 2,951 | 25,479 | 37,013 | |||||||||||||||
Depreciation and amortization | 31,498 | 13,446 | 15,559 | 260 | 60,763 | |||||||||||||||
Loss from operations | (51,663 | ) | (24,330 | ) | (15,656 | ) | (25,739 | ) | (117,388 | ) | ||||||||||
Operating margin % | (62.6 | )% | (66.8 | )% | (47.2 | )% | NA | (77.1 | )% | |||||||||||
Loss from continuing operations before income taxes | (51,951 | ) | (24,226 | ) | (15,741 | ) | (74,896 | ) | (166,814 | ) | ||||||||||
Loss from continuing operations | (51,951 | ) | (24,225 | ) | (15,786 | ) | (75,659 | ) | (167,621 | ) | ||||||||||
Depreciation and amortization | 31,498 | 13,446 | 15,559 | 260 | 60,763 | |||||||||||||||
Interest expense, net | 411 | 432 | 146 | 53,541 | 54,530 | |||||||||||||||
Income tax (benefit) expense | — | (1 | ) | 45 | 763 | 807 | ||||||||||||||
EBITDA | $ | (20,042 | ) | $ | (10,348 | ) | $ | (36 | ) | $ | (21,095 | ) | $ | (51,521 | ) | |||||
Adjustments, net | 34,209 | 8,917 | 4,627 | 11,606 | 59,359 | |||||||||||||||
Adjusted EBITDA from continuing operations | $ | 14,167 | $ | (1,431 | ) | $ | 4,591 | $ | (9,489 | ) | $ | 7,838 | ||||||||
Adjusted EBITDA margin % | 17.2 | % | (3.9 | )% | 13.8 | % | NA | 5.2 | % |
Three months ended December 31, 2017 | ||||||||||||
As Reported | Special Items | As Adjusted | ||||||||||
Revenue | $ | 46,430 | $ | — | $ | 46,430 | ||||||
Direct operating expenses | 40,967 | (5,018 | ) | [A] | 35,949 | |||||||
General and administrative expenses | 5,687 | (610 | ) | [B] | 5,077 | |||||||
Total costs and expenses | 70,384 | (8,128 | ) | [C] | 62,256 | |||||||
Loss from operations | (23,954 | ) | 8,128 | [C] | (15,826 | ) | ||||||
Loss from continuing operations | (30,902 | ) | 13,617 | [D] | (17,285 | ) | ||||||
Loss from continuing operations | $ | (30,902 | ) | $ | (17,285 | ) | ||||||
Depreciation and amortization | 21,230 | 21,230 | ||||||||||
Interest expense, net | 1,409 | 1,409 | ||||||||||
Income tax benefit | (381 | ) | (213 | ) | ||||||||
EBITDA and Adjusted EBITDA from continuing operations | $ | (8,644 | ) | $ | 5,141 |
Description of 2017 Special Items: | |
[A] | Special items primarily includes the loss on sale of underutilized assets. |
[B] | Primarily attributable to stock-based compensation and non-routine legal expenses. |
[C] | Primarily includes the aforementioned adjustments along with long-lived asset impairment charges of $2.5 million for assets classified as held-for-sale in the Rocky Mountain division. |
[D] | Primarily includes the aforementioned adjustments along with $6.0 million of capital reorganization costs incurred after the chapter 11 filing recorded to “Reorganization items, net,” offset by a gain of $0.4 million associated with the change in fair value of the derivative warrant liability. Additionally, our effective tax rate for the three months ended December 31, 2017 was (1.2)% and has been applied to the special items accordingly. |
Three months ended December 31, 2016 | ||||||||||||
As Reported | Special Items | As Adjusted | ||||||||||
Revenue | $ | 35,782 | $ | — | $ | 35,782 | ||||||
Direct operating expenses | 28,602 | (218 | ) | [E] | 28,384 | |||||||
General and administrative expenses | 9,034 | (4,152 | ) | [F] | 4,882 | |||||||
Total costs and expenses | 84,041 | (36,082 | ) | [G] | 47,959 | |||||||
Loss from operations | (48,259 | ) | 36,082 | [G] | (12,177 | ) | ||||||
Loss from continuing operations | (61,316 | ) | 35,319 | [H] | (25,997 | ) | ||||||
Loss from continuing operations | $ | (61,316 | ) | $ | (25,997 | ) | ||||||
Depreciation and amortization | 14,693 | 14,693 | ||||||||||
Interest expense, net | 13,856 | 13,856 | ||||||||||
Income tax benefit | (45 | ) | (19 | ) | ||||||||
EBITDA and Adjusted EBITDA from continuing operations | $ | (32,812 | ) | $ | 2,533 |
Description of 2016 Special Items: | |
[E] | Special items primarily includes the loss on sale of underutilized assets. |
[F] | Primarily attributable to stock-based compensation, non-routine litigation expenses, non-routine professional fees and $4.0 million for capital reorganization costs incurred for the debt exchange executed in 2016. |
[G] | Primarily includes the aforementioned adjustments along with long-lived asset impairment charges of $31.7 million for assets determined to be impaired in the Rocky Mountain division. |
[H] | Primarily includes the aforementioned adjustments along with a gain of $0.7 million associated with the change in fair value of the derivative warrant liability. Additionally, our effective tax rate for the three months ended December 31, 2016 was near zero percent and has been applied to the special items accordingly. |
Year Ended December 31, 2017 [1] | ||||||||||||
As Reported | Special Items | As Adjusted | ||||||||||
Revenue | $ | 176,071 | $ | — | $ | 176,071 | ||||||
Direct operating expenses | 148,087 | (6,032 | ) | [A] | 142,055 | |||||||
General and administrative expenses | 33,167 | (12,155 | ) | [B] | 21,012 | |||||||
Total costs and expenses | 253,690 | (23,091 | ) | [C] | 230,599 | |||||||
Loss from operations | (77,619 | ) | 23,091 | [C] | (54,528 | ) | ||||||
Income (loss) from continuing operations | 120,716 | (200,346 | ) | [D] | (79,630 | ) | ||||||
Income (loss) from continuing operations | $ | 120,716 | $ | (79,630 | ) | |||||||
Depreciation and amortization | 67,532 | 67,532 | ||||||||||
Interest expense, net | 24,979 | 24,979 | ||||||||||
Income tax (benefit) expense | (669 | ) | 441 | |||||||||
EBITDA and Adjusted EBITDA from continuing operations | $ | 212,558 | $ | 13,322 |
[1] | For illustrative purposes, the Company has combined the Successor and Predecessor periods to derive combined results for the year ended December 31, 2017. |
Description of 2017 Special Items: | |
[A] | Special items primarily includes capital re-organization costs incurred prior to the chapter 11 filing and the loss on the sale of underutilized assets. |
[B] | Primarily attributable to capital re-organization costs of $8.8 million incurred prior to the chapter 11 filing, as well as stock-based compensation, non-routine litigation expenses and non-routine professional fees. |
[C] | Primarily includes the aforementioned adjustments along with long-lived asset impairment charges of $4.9 million for assets classified as held-for-sale primarily in the Rocky Mountain division. |
[D] | Primarily includes the aforementioned adjustments along with $218.0 million of capital reorganization costs incurred in connection with the application of fresh start accounting and after emergence from chapter 11 recorded to “Reorganization items, net,” offset by a gain of $4.3 million associated with the change in fair value of the derivative warrant liability. Additionally, our effective tax rate for the twelve months ended December 31, 2017 was (0.6)% and has been applied to the special items accordingly. |
Year Ended December 31, 2016 | ||||||||||||
As Reported | Special Items | As Adjusted | ||||||||||
Revenue | $ | 152,176 | $ | — | $ | 152,176 | ||||||
Direct operating expenses | 129,624 | (5,850 | ) | [E] | 123,774 | |||||||
General and administrative expenses | 37,013 | (15,857 | ) | [F] | 21,156 | |||||||
Total costs and expenses | 269,564 | (63,871 | ) | [G] | 205,693 | |||||||
Loss from operations | (117,388 | ) | 63,871 | [G] | (53,517 | ) | ||||||
Loss from continuing operations | (167,621 | ) | 59,646 | [H] | (107,975 | ) | ||||||
Loss from continuing operations | $ | (167,621 | ) | $ | (107,975 | ) | ||||||
Depreciation and amortization | 60,763 | 60,763 | ||||||||||
Interest expense, net | 54,530 | 54,530 | ||||||||||
Income tax expense | 807 | 520 | ||||||||||
EBITDA and Adjusted EBITDA from continuing operations | $ | (51,521 | ) | $ | 7,838 |
Description of 2016 Special Items: | |
[E] | Special items primarily includes the loss on sale of underutilized assets and environmental clean-up charges. |
[F] | Primarily attributable to stock-based compensation, non-routine legal and professional fees, and capital reorganization costs of $14.3 million incurred for the debt exchange executed in 2016 |
[G] | Primarily includes the aforementioned adjustments along with long-lived asset impairment charges for assets classified as assets-held-for-sale in the Northeast division of $2.4 million and the Southern division of $2.4 million, as well as impairment charges of $31.7 million for the Rocky Mountain division and $5.7 million for the Northeast division. |
[H] | Primarily includes the aforementioned adjustments, along with a charge of $0.7 million in connection with the write-off of a portion of the unamortized deferred financing costs as a result of an amendment to our Predecessor Revolving Facility, a gain of $3.3 million associated with the change in fair value of the derivative warrant liability, and a gain on the sale of Underground Solutions, Inc. for $1.7 million. Additionally, our effective tax rate for the twelve months ended December 31, 2016 was 0.5% and has been applied to the special items accordingly. |
Year Ended | ||||||||
December 31, | ||||||||
2017 [1] | 2016 | |||||||
Net cash used in operating activities from continuing operations | $ | (25,410 | ) | $ | (26,251 | ) | ||
Less: net cash capital expenditures [2] | 1,737 | 6,870 | ||||||
Free Cash Flow | $ | (23,673 | ) | $ | (19,381 | ) |
[1] | For illustrative purposes, the Company has combined the Successor and Predecessor periods to derive combined results for the year ended December 31, 2017. |
[2] | Purchases of property, plant and equipment, net of proceeds received from sales of property, plant and equipment |
Three Months Ended | Year Ended | |||||||||||||
December 31, 2017 | December 31, 2017 [1] | |||||||||||||
Total Revenue Growth | $ | 10,648 | 29.8 | % | $ | 23,895 | 15.7 | % | ||||||
Breakdown of Total Revenue Growth: | ||||||||||||||
Price | 3,646 | 10.2 | 5,892 | 3.9 | ||||||||||
Activity | 7,002 | 19.6 | 18,003 | 11.8 | ||||||||||
Acquisition | — | — | — | — | ||||||||||
$ | 10,648 | 29.8 | % | $ | 23,895 | 15.7 | % |
[1] | For illustrative purposes, the Company has combined the Successor and Predecessor periods to derive combined results for the year ended December 31, 2017. |
Three Months Ended | Year Ended | |||||||||||||
December 31, 2017 | December 31, 2017 [1] | |||||||||||||
Total Adjusted EBITDA Growth | $ | 2,608 | 102.9 | % | $ | 5,484 | 70.0 | % | ||||||
Breakdown of Total Adjusted EBITDA Growth: | ||||||||||||||
Price | 3,263 | 128.8 | 4,876 | 62.2 | ||||||||||
Activity/Expense | (527 | ) | (20.8 | ) | 502 | 6.4 | ||||||||
Acquisition | — | — | — | — | ||||||||||
Corporate | (128 | ) | (5.1 | ) | 106 | 1.4 | ||||||||
$ | 2,608 | 102.9 | % | $ | 5,484 | 70.0 | % |
[1] | For illustrative purposes, the Company has combined the Successor and Predecessor periods to derive combined results for the year ended December 31, 2017. |
Year Ended | |||
December 31, 2017 | |||
Water Trucks: | |||
Count (approximate) | 550 | ||
% Utilized [1] | 52.0 | % | |
Salt Water Disposal Wells: | |||
Count | 48 | ||
% Utilized [2] | 36.0 | % | |
Haynesville Pipeline: | |||
% Utilized [2] [3] | 46% - 89% |
[1] | Trucking utilization assumes a five day work-week and running twelve hours per day. |
[2] | Salt Water Disposal Well and Pipeline utilization is calculated based on functional capacity rather than permitted capacity. Functional capacity reflects any factors limiting volume such as pressure limits, pump or tank capacity, etc. and can potentially be increased with additional capital investment. |
[3] | The range of utilization for the Haynesville Pipeline represents the high and low for the year. |
Average for the Year Ended | Average for the Year Ended | Year-Over-Year | |||||||||
December 31, 2017 | December 31, 2016 | Growth % | |||||||||
Pricing: | |||||||||||
Oil price per barrel | $ | 50.80 | $ | 43.29 | 17.3 | % | |||||
Natural gas price per tcf | $ | 2.99 | $ | 2.52 | 18.7 | % | |||||
Operating Rigs | 227 | 132 | 72.0 | % | |||||||
Oil Production (barrels in thousands) | 2,423 | 2,451 | (1.1 | )% | |||||||
Natural Gas Production (Mcf/d) | 38,755 | 36,229 | 7.0 | % | |||||||
Wells Completed | 4,469 | 3,380 | 32.2 | % | |||||||
Drilled Uncompleted Ending Inventory | 3,134 | 2,955 | 6.1 | % |
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