Amortization Schedule Reverse Eliminate Your Fears And Doubts About Amortization Schedule Reverse
HOUSTON, Sept. 02, 2020 (GLOBE NEWSWIRE) — KLX Energy Casework Holdings, Inc. (Nasdaq: KLXE) (“KLXE” or the “Company”) today appear banking after-effects for its budgetary added division assured July 31, 2020. On July 28, 2020, KLXE completed its advanced appear alliance with Quintana Energy Casework Inc. (“QES”) and accomplished a one-for-five about-face banal breach accordingly with closing the transaction. Accustomed that the alliance was completed at the end of the KLXE budgetary division assured July 31, 2020, after-effects for KLXE abundantly reflect the achievement of KLXE, and accommodate three canicule of QES results.
See “Non-GAAP Banking Measures” at the end of this absolution for a altercation of Adapted EBITDA and its adaptation to the best anon commensurable banking admeasurement afflicted and presented in accordance with U.S. about accustomed accounting attempt (“GAAP”).
Chris Baker, President and Chief Controlling Officer of KLXE, stated, “We are aflame to complete our alliance advanced of schedule, creating an industry-leading adapted oilfield account provider. I acknowledge the amazing efforts fabricated by our accumulated aggregation to accomplish this anniversary and attending advanced to the connected success of KLXE. Our administration aggregation is focused on alive on our able-bodied affiliation plan and best accession KLXE to abide to bear industry-leading articles and casework to our barter and partners.
“Our budgetary added division after-effects were afflicted by the COVID-19 pandemic, the Saudi Arabia and Russia bazaar allotment altercation and the constant supply-demand imbalance, which led to a abasement in industry altitude and decreased appeal for our services. Our geographic segments, the Southwest, Rocky Mountains and the Northeast/Mid-Con, acquaint budgetary added division acquirement of $4.2 million, $18.0 actor and $14.0 million, respectively.
“KLXE will abide to accumulate its asset abject and operational brand as we accommodate the QES alliance in adjustment to apprehend synergies and to adjust with accepted bazaar conditions, thereby carrying added adeptness and convalescent returns. KLXE is abnormally positioned to accomplish with analogously lower basic expenditures accustomed the asset-light attributes of its artefact and account offerings. In the aboriginal canicule post-merger, we accept apparent absolute allowances from the accumulated operational adeptness and chump relationships forth with the abysmal artefact adeptness brought calm by anniversary of the bequest companies. We are assured that this allocation will acquiesce us to cull through accoutrement and technologies aloft our coiled tubing brand as able-bodied as drive added appliance in added artefact lines.
“As we attending ahead, bazaar altitude for U.S. conduct and completions will be arduous during the added bisected of 2020, apprenticed by low article prices and decidedly lower E&P basic spending. Despite the industry backdrop, KLXE is now able-bodied able to bear amount to all stakeholders, authentic by industry-leading affirmation and account quality, a able antithesis sheet, a ample mix of artefact account curve and added investments in avant-garde solutions,” assured Baker.
Keefer Lehner, Controlling Vice President and Chief Banking Officer of KLXE, added, “We accept accelerated the timing of our $40.0 actor run-rate amount synergy commitment, which we now apprehend to absolutely abduction by the end of the aboriginal budgetary division of 2021.
“Our administration aggregation has abysmal acquaintance in affiliation planning, assay and beheading in a agnate bazaar ambiance accepting auspiciously chip Archer’s U.S. operations into QES in 2016. The $40.0 actor in synergies are predominantly accumulated and authoritative in attributes and, thus, added readily achievable. Additionally, we are optimistic we will accretion added amount extenuative opportunities as we assignment through the affiliation action and accept the accepted bazaar environment, admitting challenging, should advice facilitate an expedited affiliation process. We abide awful assured in our adeptness to accomplish our targets and accept KLXE’s clamminess profile, forth with its arrangement amount structure, will acquiesce the Aggregation to cross the accepted bazaar ambiguity and ultimately position the Aggregation for abiding success.”
The accumulated alignment has a awful accomplished workforce with a allegation to safety, performance, chump achievement and profitability. As the foremost U.S. provider of ample bore coiled tubing services, KLXE additionally offers its baddest chump abject a commutual portfolio of articles and services, including thru-tubing services, throughout all aloft onshore oil and gas basins in the U.S. The Aggregation is now able to accumulate operational abutment and technology advancements aloft a broader apartment of account offerings. Finally, through its added calibration and artefact and account offerings advised to accommodated the needs of barter throughout the able-bodied lifecycle, KLXE is accepted to accomplish cross-selling opportunities that acquiesce for an added allotment of chump spend.
Excluding the appulse of the estimated $40.0 actor of annualized run-rate amount synergies that will aftereffect from the merger, the accumulated companies’ budgetary year 2019 pro forma revenues were added than $1.0 billion, and adapted EBITDA was $106.0 million. As of July 31, 2020, KLXE had about $98.5 actor of banknote and an undrawn $100.0 actor revolving acclaim facility, of which about $14.9 actor was accessible (excluding the account of QES accepted assets). Importantly, the accumulated aggregation has a able antithesis area to abutment analytical advancing business initiatives as able-bodied as the afterward of added value-creating alliance opportunities aural the oilfield account industry.
Asset and Artefact Portfolio Update
On a accumulated abject afterward the closing of the merger, KLXE has a abundant asset abject comprised of high-quality adolescent assets and has conducted a absolute analysis of its collective coiled tubing and wireline asset abject as allotment of the Company’s affiliation plan.
KLXE now has a agile of 39 coiled tubing units (24 of which are ample diameter), authoritative KLXE the better provider of ample bore coiled tubing in the United States. In accession to the bazaar arch coiled tubing offering, KLXE is a arch provider of wireline, fishing, thru-tubing and able-bodied ascendancy services.
The KLXE portfolio now includes QES’ Directional Conduct belvedere and expects to abduction synergies on downhole accoutrement and motors with the articles and casework provided through the achievement and assembly offerings.
Reverse Banal Split
On July 24, 2020, KLXE stockholders accustomed a angle to alter KLXE’s affidavit of assimilation to aftereffect a one-for-five about-face banal split.
Fiscal Added Division 2020 Banking Results
Revenue for the budgetary added division of 2020 totaled $36.2 million, a abatement of 56.4%, compared to $83.0 actor for the aboriginal division of 2020. Net accident for the budgetary added division of 2020 was $20.4 million, compared to net accident of $243.1 million, across-the-board of $208.7 actor non-cash asset crime charge, for the aboriginal division of 2020. Adapted EBITDA accident for the budgetary added division of 2020 was $10.6 million, compared to Adapted EBITDA assets of $2.6 actor for the aboriginal division of 2020. Selling, accepted and authoritative expenses, across-the-board of $5.5 actor of accord costs, $7.5 actor of severance and $15.1 actor of non-cash disinterestedness advantage angry to accelerated vesting for the budgetary added division of 2020 totaled $41.8 million, as compared to $17.4 actor for the aboriginal division of 2020. The abatement in revenues reflects the appulse of the COVID-19 communicable and the appulse of the Saudi Arabia and Russia bazaar allotment altercation and constant supply-demand imbalance, which led to a abasement in industry altitude and a abatement in appeal for our services. On a artefact band basis, completion, assembly and action casework contributed about 60.5%, 18.8% and 20.7%, respectively, to budgetary added division revenues.
Fiscal Added Division 2020 Articulation Results
The Aggregation letters through three geographic business segments, the Rocky Mountains, Southwest and Northeast/Mid-Con. Acquirement decreases aloft all three geographic segments were apprenticed by the accumulated of the abiding impacts of the Saudi Arabia and Russia oil bazaar allotment altercation and the abiding appeal abolition acquired by the COVID-19 pandemic, which have accordingly apprenticed the appeal for oil to depressed levels constant in decreases in appeal for casework such as those provided by the Company.
Rocky Mountains: Acquirement and adapted EBITDA accident for the Rocky Mountains articulation was $18.0 actor and $3.7 million, appropriately for the budgetary added division of 2020. Acquirement represents a 46.7% abatement over aboriginal division 2020.
Southwest: Acquirement and adapted EBITDA accident for the Southwest segment, which includes the Permian and South Texas, was $4.2 actor and $1.9 million, respectively, for the budgetary added division of 2020. Acquirement represents an 82.8% abatement over aboriginal division 2020.
Northeast/Mid-Con: Acquirement and adapted EBITDA accident for the Northeast/Mid-Con articulation was $14.0 actor and $5.0 million, respectively, for the budgetary added division of 2020. Revenues decreased 43.5% over aboriginal division 2020.
For the division assured July 31, 2020, the Rocky Mountains articulation operating accident was $25.6 million, Northeast/Mid-Con articulation operating accident was $17.2 actor and Southwest articulation operating accident was $11.1 million.
The afterward is a collapsed arbitrary of acquirement and Adapted EBITDA for the three-month periods assured July 31, 2020 and April 30, 2020 ($ in millions):
1 Excludes Costs as Defined, as authentic in the Adaptation of Circumscribed Net Accident to Adapted EBITDA (loss) assets table below, non-cash advantage amount and non-cash asset crime expense.
Fiscal Added Division 2020 EBITDA Addbacks
Adjusted EBITDA accident for the budgetary added division of 2020 includes net adjustments of $10.3 million, apprenticed by the $41.1 actor arrangement acquirement gain, account by $13.0 actor of transaction accompanying costs, $15.1 actor of non-cash banal advantage amount and $2.7 actor in added costs.
Balance Area and Liquidity
Total debt outstanding as of July 31, 2020 was $243.4 million, compared to $243.0 actor as of January 31, 2020. As of July 31, 2020, banknote and equivalents totaled $98.5 million.
Total accessible clamminess as of July 31, 2020 was about $113.4 million, including availability beneath our undrawn ABL Facility. As of July 31, 2020, about $26.2 actor of accounts receivable and inventories had not yet been included in our borrowing base.
Bargain Acquirement Gain
On July 28, 2020, the Aggregation completed the alliance with QES for an accumulated accretion amount of about $44.4 million, comprised of 3.4 actor shares of the Company’s accepted stock. Absolute application includes the $34.7 actor acquirement amount and claim of $9.7 actor in outstanding borrowings and associated fees and costs of QES’s five-year asset-based revolving acclaim acceding (the “QES ABL Facility”).
Based on the Company’s basic acquirement amount allocation, the acquirement amount was beneath than the fair amount of the identifiable assets acquired, which resulted in a $41.1 actor arrangement acquirement accretion actuality recorded on the abridged circumscribed statements of operations for the three and six months assured July 31, 2020.
Acceleration of Abstract Amortization
During the budgetary division assured July 31, 2020, administration evaluated the abstract assets primarily accompanying to chump relationships. Considering accepted chump action and bazaar conditions, the Aggregation adopted to advance abstract acquittal costs that resulted in an acquittal allegation of $2.7 million.
Other Banking Information
Capital expenditures were $3.7 actor during the budgetary added division of 2020, decreased of $1.1 million, or 22.9%, compared to basic expenditures of $4.8 actor in the aboriginal division of 2020. Basic spending during the budgetary aboriginal and added abode of 2020 was apprenticed primarily by aliment basic expenditures aloft our segments.
Conference Alarm Information
KLXE has appointed a appointment alarm for 9:00 a.m. Central Time (10:00 a.m. Eastern Time) on Thursday, September 3, 2020, to analysis appear results. You may admission the alarm by blast at 1-201-389-0867 and ask for the KLXE 2020 Budgetary Added Division Appointment Call. The webcast of the alarm may additionally be accessed through the Investor Relations area of the Company’s website at https://investor.klxenergy.com/events-and-presentations/events. A epitomize of the alarm can be accessed on the Company’s website for 90 canicule and will be accessible by blast through September 10, 2020, at (201) 612-7415, admission cipher 13708491#.
About KLX Energy Services
KLX Energy Casework is a provider of adapted oilfield casework to arch onshore oil and accustomed gas analysis and assembly companies operating in both accepted and anarchistic plays in all of the alive aloft basins throughout the United States. The Aggregation delivers mission analytical oilfield casework focused on drilling, completion, action and assembly activities for the best technically ambitious wells from over 60 account accessories amid in the United States. KLXE’s commutual apartment of proprietary articles and specialized casework is authentic by technically accomplished cadre and a ample portfolio of avant-garde centralized analysis and development, manufacturing, adjustment and aliment capabilities. Added advice is accessible at www.klxenergy.com.
Forward-Looking Statements and Cautionary Statements
The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for advanced statements to animate companies to accommodate -to-be advice to investors. This account absolution (and any articulate statements fabricated apropos the capacity of this release, including on the appointment alarm appear herein) includes advanced statements that reflect our accepted expectations and projections about our approaching results, achievement and prospects. Advanced statements accommodate all statements that are not absolute in attributes and are not accepted facts. Back acclimated in this account absolution (and any articulate statements fabricated apropos the capacity of this release, including on the appointment alarm appear herein), the words “believe,” “expect,” “plan,” “intend,” “anticipate,” “estimate,” “predict,” “potential,” “continue,” “may,” “might,” “should,” “could,” “will,” or the abrogating of these agreement or agnate expressions are advised to analyze advanced statements, although not all advanced statements accommodate such anecdotic words. These advanced statements are based on our accepted expectations and assumptions about approaching contest and are based on currently accessible advice as to the aftereffect and timing of approaching contest with account to, amid added things: our operating banknote flows; the availability of basic and our liquidity; our approaching revenue, assets and operating performance; our adeptness to sustain and advance our utilization, acquirement and margins; our adeptness to advance adequate appraisement for our services; approaching basic expenditures; our adeptness to accounts equipment, alive basic and basic expenditures; our adeptness to assassinate our abiding advance action and to accommodate our acquisitions, including QES; our adeptness to auspiciously advance our analysis and technology capabilities and apparatus abstruse developments and enhancements; and the timing and success of cardinal initiatives and adapted projects.
Forward-looking statements are not assurances of approaching achievement and absolute after-effects could alter materially from our absolute acquaintance and our present expectations or projections. These advanced statements are based on management’s accepted expectations and beliefs, forecasts for our absolute operations, experience, expectations and acumen of absolute trends, accepted conditions, advancing approaching developments and their aftereffect on us, and added factors believed to be appropriate. Although administration believes the expectations and assumptions reflected in these advanced statements are reasonable as and back made, no affirmation can be accustomed that these assumptions are authentic or that any of these expectations will be accomplished (in abounding or at all). Our advanced statements absorb cogent risks, contingencies and uncertainties, best of which are difficult to adumbrate and abounding of which are aloft our control. Known absolute factors that could account absolute after-effects to alter materially from those in the advanced statements include, but are not bound to, risks associated with the following: a abatement in appeal for our services, including due to the advancing COVID-19 pandemic, crumbling article prices, overcapacity and added aggressive factors affecting our industry; the alternate attributes and animation of the oil and gas industry, which impacts the akin of exploration, assembly and development action and spending patterns by E&P companies; a abatement in, or abundant animation of, awkward oil and gas article prices, which about leads to decreased spending by our barter and abnormally impacts drilling, achievement and assembly activity; and added risks and uncertainties listed in our filings with the U.S. Securities and Exchange Commission, including our Accepted Letters on Form 8-K that we book from time to time, Quarterly Letters on Form 10-Q and Annual Report on Form 10-K. Readers are cautioned not to abode disproportionate affirmation on advanced statements, which allege alone as of the date hereof. We undertake no obligation to about amend or alter any advanced statements afterwards the date they are made, whether as a aftereffect of new information, approaching contest or otherwise, except as adapted by law.
KLX Energy Casework Holdings, Inc.Condensed Circumscribed Statements of Operations(In millions of U.S. dollars and shares, except per allotment amounts) (Unaudited)
(1) Basic and adulterated net (loss) balance per allotment were retroactively adapted for the Company’s 1-for-5 about-face banal breach able July 28, 2020.
KLX Energy Casework Holdings, Inc.Condensed Circumscribed Antithesis Sheets(In millions of U.S. dollars and shares)(Unaudited)
(1) Accepted banal and treasury banal was retroactively adapted for the Company’s 1-for-5 about-face banal breach able July 28, 2020.
KLX Energy Casework Holdings, Inc.Condensed Circumscribed Statements of Banknote Flows(In millions of U.S. dollars)(Unaudited)
KLX Energy Casework Holdings, Inc.Additional Selected Operating Data(Unaudited)
Non-GAAP Financial Measures
This absolution includes Adapted EBITDA (loss) and chargeless banknote breeze to reflect net accident afore amortization, Costs as Authentic and non-cash advantage expense. This absolution additionally includes “Adjusted EBITDA (loss),” which excludes Costs as Authentic and non-cash advantage expense. Adapted EBITDA (loss) is acclimated to account the Company’s advantage ratio, constant with the agreement of the Company’s ABL facility. Anniversary of the metrics are “non-GAAP banking measures” as authentic in Regulation G of the Securities Exchange Act of 1934. See “Reconciliation of Non-GAAP Banking Measures.”
Adjusted EBITDA is a supplemental non-GAAP financial admeasurement that is acclimated by administration and alien users of our banking statements, such as industry analysts, investors, lenders and appraisement agencies.
We accept Adapted EBITDA is advantageous because it allows us to added finer appraise our operating achievement and analyze the after-effects of our operations from aeon to aeon after attention to our costs methods or basic structure. We exclude the items listed aloft in accession at Adapted EBITDA because these amounts can alter essentially from aggregation to aggregation aural our industry depending aloft accounting methods and book ethics of assets, basic structures and the adjustment by which the assets were acquired. Adapted EBITDA should not be advised as an another to, or added allusive than, net assets as bent in accordance with GAAP, or as an indicator of our operating achievement or liquidity. Certain items afar from Adapted EBITDA are cogent apparatus in compassionate and assessing a company’s banking performance, such as a company’s amount of basic and tax structure, as able-bodied as the celebrated costs of depreciable assets, none of which are apparatus of Adapted EBITDA. Our computations of Adapted EBITDA may not be commensurable to added analogously blue-blooded measures of added companies.We ascertain chargeless banknote breeze as net banknote provided by operating activities beneath basic expenditures.
Our administration uses chargeless banknote breeze to appraise the Company’s clamminess and adeptness to accord crumbling debt, armamentarium operations and accomplish added investments. We accept that chargeless banknote breeze provides advantageous advice to investors because it is an important indicator of the Company’s liquidity, including its adeptness to abate net debt, accomplish cardinal investments and repurchase stock.
The afterward tables present a adaptation of the non-GAAP banking measures of Adapted EBITDA and chargeless banknote breeze to the best anon commensurable GAAP banking admeasurement for the periods indicated:
KLX Energy Casework Holdings, Inc.Reconciliation of Circumscribed Net Accident To Adapted EBITDA (Loss) Income(in millions)(Unaudited)
Reconciliation of Rocky Mountains Operating Accident To Adapted EBITDA(in millions)(Unaudited)
Reconciliation of Northeast/Mid-Con Operating Accident To Adapted EBITDA(in millions)(Unaudited)
Reconciliation of Southwest Operating Accident Assets To Adapted EBITDA(in millions)(Unaudited)
(1) Costs as Authentic in the budgetary added division relates to accelerated banal based advantage costs, severance costs, chump accord abstract acquittal costs and Alliance costs of $15.1 million, $7.5 million, $2.7 actor and $5.5 million, respectively. The aboriginal division relates to a amicableness and abiding asset crime charges, business cause and added costs accompanying to the alliance with QES and new artefact and account band start-up costs of $208.7, $11.9, $1.1 and $1.0, respectively.
KLX Energy Casework Holdings, Inc.Segment Adapted EBITDA Margin(in millions)(Unaudited)
(1) Articulation Adapted EBITDA Margin is authentic as the caliber of Articulation Adapted EBITDA (loss) assets and absolute articulation revenue. Articulation Adapted EBITDA is net assets (loss) excluding Costs as Defined, non-cash advantage amount and non-cash asset crime expense.
The afterward table presents a adaptation of the non-GAAP banking admeasurement of chargeless banknote breeze to the best anon commensurable GAAP banking admeasurement for the periods indicated:
KLX Energy Casework Holdings, Inc.Reconciliation of Net Banknote Breeze Provided by Operating Activities to Chargeless Banknote Flow(in millions)(Unaudited)
Contacts:KLX Energy Casework Holdings, Inc.Keefer M. Lehner, EVP & [email protected]
Dennard Lascar Investor RelationsKen Dennard / Natalie [email protected]
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