MRC - Earnings call transcript Q2 2019

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Operator

Greetings, and welcome to the MRC Global Second Quarter Earnings Conference Call. [Operator Instructions].

As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Monica Broughton, Director of Investor Relations. Thank you, Ms. Broughton.

begin. may You

Monica Broughton

good Second and We Welcome the to you Thank XXXX morning, Earnings Global Quarter us Webcast. Conference MRC joining you today. everyone. Call appreciate and

we release. XX, and CFO. by as yesterday's will CEO; is call, On available President today's replay well XXXX. phone There information Andrew our by in Executive President Braun, as webcast be and on the The Vice dial-in and have of Jim August call a until Lane, mrcglobal.com, website,

as We our will XX-Q be we reported time remarks EBITDA Please of file XXXX, speaks In our therefore, percentage, discuss expect gross margin. today, available later X, will replay. the August the may call that website. Form to and that advised only accurate you of today, are gross on report quarterly adjusted today, as EBITDA adjusted our it profit profit, and adjusted information also it this and note adjusted be of on on no longer

You measures of to about on these GAAP to all to related of filings be our can a use release learn non-GAAP earnings are the and our read to of these website. more see items, reconciliation measures encouraged found which and securities our

of securities made federal In management laws. forward-looking this of call These statements of statements addition, may the the by States MRC forward-looking comments the contain the MRC of within management the Global views current United during Global. the reflect meaning

However, MRC expressed from those today. Global's results materially actual could differ

forward-looking company's for concerning of SEC risk a filings more are these review You the to read in-depth factors the encouraged statements.

Mr. the call Andrew like to Lane. to over now turn our I'd CEO, And

Andrew Lane

highlights, interest Jim more will you morning and for financial quarter call results. CFO, your of and us detailed XXXX and company's second Today, review Braun, I then Thank I'll operational for the Global. our review over for MRC turn the joining you, to Monica. in today the thank Good continued a

which, changing customers patterns broader deviated results in they're the pressure environment, saw primarily to we their us, of response somewhat patterns. market disciplined, the spending behavior quarter, This to more means to historic be from that to

were We course, projects. the in the also nonrecurring timing changes some deliveries of as and saw such that ordinary

so in adapted maximize quickly and any can we environment. returns have However, adjusted we

long-term to make profitability gaining and objectives progress by continue We our against and our share, capital strategic capital maximizing market structure. optimizing efficiency, working

our progressing we first, address I'll against quarter I'll strategic response. second are the but of how start actions objectives, our results and with in some

revenue a the improvement was quarter Second million, X% $XXX over XXXX quarter. first

million first first which $XX X.X% improvement the was finally, We share which over in improvement quarter. XX% quarter, revenue, in over we $X.XX the X% also of adjusted of total per achieved second a a or the EBITDA quarter. was And are

June, over at as revenue activity shortfall Sequentially, levels of in in was increase all short expectations April business results. this However, of most capital occurring decline with deliveries we specific quarter and an of fell. the much levels. discipline, our May the expected growth our this customers upstream fell timing and where influenced disruption Instead, customer of

in growth they sector. substantial have nonrecurring experienced this as Also, remained business while our quarter, a our base headwind have midstream projects downstream

customer We we have as the had much expected of backfill not but the in as reduction been project revenue able gap, to overall given some spending.

slightly Given the XXXX lower improvement expect expectations than quarter less that to XXXX. we did over backdrop, but second We as revenue a expect now still guidance year. lowered so in previously. the third We for we've the than in come

we albeit continue growing, Our on modestly share a as business is to still despite market focus more challenging base underlying environment.

the cash updated of an yield which guidance Inventory end our decline our cash a increase the cash $XX levels Consistent $XXX second Given for from strategies, achieve free working year, to expect than for are planned our million, previously outlook, supporting of now implies to the our with flow we of to than capital quarter expect sales to more revenue we the operations target reduced from projected. generate full XXXX million working year, by more levels. capital XX%. of

slower in the operating swift considering market Also as conditions, reduce the we've past, costs. done to action we've a taken

are quarter early continued million, not have pay being first operating from period capital by profitability expectations costs our cash hiring of our business, and including capital-intensive a we cost are by We softness. maximizing lowered All and year also for a reduced costs expenditure quarter flow actions freeze lowered in well the actions this have as we while and market undertaken, focus our with retirement the additional on Also, operating line program. the a million. for voluntary these $XX expected as XXXX $X during and

Turning on our progress to strategic objectives. our

part and have to customers, couple existing market of As market strategy grow our a with new share with share customers maintain updates.

which This were recovering will benefit quarter, our for years, a Neste international contract we Finland awarded segment. five in new with

but new we EnLink contract one last announced continue midstream quarter, customers. be XXXX a from year, additional We to see which in so later of our largest we with when to gathering to expect more EnLink and this implement also revenue Midstream transmission some and expect

valves for more MRO for renewed to becomes strategy a is agreements three spending. also our seven five with it We overall their our less is This years where there important even recently ConocoPhillips Chevron-TCO years, framework an and for Atmos and component years. for core in with with environment

of new With up manufacturing modify us facility, and provide technical will for year. the construction and activity take third and midstream commitment higher valve product we to square-foot over to modification XX% XXX,XXX we have the of and complex. valves with in an La a first deliver this the to with from on This value-added market now Porte have sales service sales XXXX. quarter market the additional complete our share competitive capabilities we half initial our valve offerings, due center, to expanding the In of our are advantage, operational XXXX, and ability midstream sales, will valve in assemblies test completed in-house. will higher opportunities new XX% track Consistent margins higher-margin of were to our and It our this be valve the ramp course of in operations content. total

supply We documentation; MRCGO. In us if comprehensive easy an customers July, search are benefits this a a portal savings time, digital PVF platform customers This activities, is in with solution is view the information for order inventory; and and customers. we in access their cost and its technical this The current believe seamless that of of status for gas while From time at announced called check easier first having manner. the can online expedite and purchasing the solution they receive they kind cloud-based oil support. them, and order transact access critical resulting needed; simplification chain history; our the can the single of comprehensive order and to sign-on, allows delivery, our customers and to to require. products; and same

initiative customer broader grow rolling current to to market next This with catalog largest enhancing share are out the months. experience. expand the strategic to expect and this customers to continue first XX objectives We in XX this our to our customers fits through to over

our shareholders Finally, in return to cash of the part continued second allocation as capital strategy. we to quarter,

total shares, repurchase of announced Since shares. $XXX $XX million programs, began previously quarter, we repurchased shareholders. share million a have in XXXX, As repurchased our when we XX.X to the early an million returning we additional

plan $XX have under We current buy we authorization remaining execute, to million during to our opportunistically and continue to XXXX.

by revised cash and of debt our We to capital evaluate the near cash short- needs. term end flow the long-term in year. on also all plan about light based the and in make determination expect X.Xx We leverage allocation our to options of reduction to a expectations and focus on continually decline

committed are returns. shareholder to maximizing We

Before retire in has a contributions, Jim, U.S. I minute as helped I PVF to Jim to debt Directors and as in for very Board and to us organically business contributions excellent in his of are recognize strengthening spring. XXXX next April I led instrumental his several contributed the intention in joined company well turn he which and light has building take over XXXX. many public Among company take successful many Jim the the want acquisitions and to helping the global job, me was grateful company this he leader. accomplishments a significantly years, in of successfully the his the all refinancing, an our done his with eight over last make in call contributions.

As to he he has X. on next turned year recently decided March retire XX,

search, we a external have over we the and expect We started months. seven will an next smooth have transition

to call the I'll over to the Jim now for financial quarter. highlights turn cover the

James Braun

I've than quarter. second increased of of I received pleasure MRC the and the for in were everyone, good kind thank now lower X%. reporting quarter XXXX Total the for and quarter, for decline each Andrew, the with the the everyone to support and the X% of as first revenues the morning, million, were first Sequentially, eight words. serving past quarter Well, sales and moving Global, CFO years segments It's year-over-year last been from our $XXX over a geographic sectors of a year, comparison. which thanks,

falling Pennsylvania downstream the the same energy in second of revenue the that second in lower previously sectors completion U.S. year. the than with in The winding sales basically the due XXXX, downstream nearly the midstream quarter midstream project completions. Shell well mid-XXXX of the the projects the a revenue well XXXX project-related had XXXX, large XXXX, result with second sales impacted flat short the the sector impact million to X% chemical quarter we U.S. down in quarter other million upstream declined work and in the revenue TC a in U.S. comparison. as of the the growth of project of decreases negative as discussed. on were over nonrecurring of $XXX U.S. was market in quarter were as quarter-over-quarter by second that $XX quarter of prior

back are to decided includes There third-party outsourcing on an not work are capital this to pull customers dynamic. This and discipline to on spending. at cases, factors Most all of as they focus fully some bid In contributing margin. decision-making attractive several engaged greater fabricators. on focused we've

Another natural orders deliveries wells term. quarter. the opportunities facilities. tank tie had batteries in which experiencing, the our the and This is reduced near we specific in way activities operators acquisition-related conserve of the has on an and impact finally, completed are existing of timing customer And to capital, of larger

that focus on of and the continue our customer unprecedented, issues, at it term. some a short-term is expected perhaps new, these that in is in base returns near is While are least clear capital there to

$XX sales. the by affected adversely government-imposed last weak of XXXX, from the Canadian was the impacting million in likelihood to unfavorably A second weaker contributed decline, as are oil to underway. Canadian second Canadian production down XX% of remains improvement. year activity challenging quarter near-term and also dollar be our continues of to we upstream limits. see current revenues the quarter sector prices most business and the little Canada a the to market, levels Actions rightsize

International the revenue to XXXX, quarter the concluding down in the from a as currencies. weaker was as major year second quarter ago same due impact Kazakhstan of well foreign primarily in a $XXX the of project million X% of

FX sales and project particularly and conditions, market improvements in the we are Kingdom. the United Excluding international in $XX grew several markets. international the improving our impact, challenging Norway years, After million, seeing reflecting

the and upstream our Canadian by same basically growth the summarize to the Basin, XXXX of Specific the in billings. experienced the quarter we the last Permian the however, $XXX decreased quarter Now quarter in nearly upstream same described by business. a project decline; grew TCO market. This sequential reduction flat, U.S. year end second quarter was somewhat million offset growth sales performance XXXX period sales revenue earlier. sector in year driven the from is upstream business XXXX base pace as over most of area. of second let a first declines over International the the flat me as X% in last active X% slower the in was remains year. the Upstream than to prior

down the the in second in prior which quarter XX% Midstream of U.S.-based, same year. XXXX, are sector quarter primarily million from sales, the $XXX

gathering project as in work down, XXXX. and transmission a Our subsector mentioned earlier, was with large

the second in Because However, utility the to commodity we quarter over ago. compound programs part our saw expect related Since business, prices, this single-digit X%, revenue quarter, of to strong sales the of XXXX. show our XXXX, growth. rate annual another XX% and year U.S., business, the the a we year about same growth integrity overall continues in growth across management XX% gas which was quarter our of of ongoing second of a has in not high growth

sector, The downstream the quarter project, impact the the downstream XXXX sector the down to the second primarily earlier. projects, decline mentioned of revenue including second of U.S. million, year. X% In related drove from quarter Polymers was last as Shell $XXX

income Gross increased reflects in margins. as a to to turning XXXX The improvement basis XXX XX.X% now profit compared second quarter was second the And impact in pressures LIFO in the unfavorable benefit XXXX. pipe offset XX.X% points compared quarter of of $XX This LIFO in $X from of million to line million quarter deflationary the as of expense group. year. of product the in prior the to our by current

XXXX profit XX.X% period and gross of compared $XXX was XX.X% Adjusted or for XXXX. of revenue the to same the $XXX for second million quarter in as million

points which basis negatively gross XX with compared even quarter basis a a Our margins greater sequential adjusted our due impact were points. on year deflation about pipe, And in ago. to to of not was about expectations line this XX line the impacted at on adjusted margins primarily gross basis margins in

line pipe lower Logix quotas same Line priced on of softer a pipe Pipe to index, over in than XX% and of is has in. and latest line second pipe soft items spot prices quarter quarter a margins. of pre-tariff on second all back were The today second pressure the a were demand, due line average of prices the of prices XXXX hand XXXX on to in Line Based diameter put XXXX. the quarter pipe have tariffs pipe of XXXX been quarter pricing and the cost levels. the small higher effects lower combination lower in pipe market sales the as inventory oversupply in

impact under oversupply the greater. Line in deflation demand prices While sales the we higher-margin given of are to remain shifting pressure such to valves, our pipe was expected to products are as situation. soft continue

our full for let income the a the for now expense us that adjusted the to million expect between expectation year. XXXX. We impact gross reduced XX.X%. $XX of $XX outlook, LIFO million XXXX our year to we've of Given year profit with midpoint margin full lower also of is This LIFO our for expectations be and

quarter as XX.X% XX.X% XXXX compared in for or sales million were $XXX costs SG&A second period the XXXX. sales $XXX of to the or of in of same million

and due and SG&A the light was lower the lower reduction Second lowered incentive expense for our lower to our considered. million the guidance during of plan quarter actions fluctuations of SG&A we've being quarterly SG&A the impact does expect SG&A activity costs, than lower personnel planned for quarter restructuring In of implied We guidance the by And levels year. can actions cost we XXXX. SG&A any $XXX the year. including levels Andrew, adjustment also the activity Also, in for reflect expense. before, our described $XXX currently million for we have now guidance experience not charges as to of expense mentioned

program. the second for share or the improvement with was count second Our share XXXX million result also in per $X.XX to diluted expectations our net to for shareholders despite our income the lower expense common share of XXXX. SG&A is of year. for quarter lower XX%, income the million $XX rate of was share expense. repurchase LIFO diluted a quarter quarter effective lower The has full as due $X.XX $XX net revenue Earnings per line attributable in or tax and from improved lower share a per and diluted for And

the XXXX. than quarter for ago reported Adjusted the XXXX $XX second EBITDA our versus the the $XX this same three year the lower first quarter. of quarter quarter by million a year million Adjusted second of quarter but last EBITDA were to X.X% All positive margins in was higher $XX year. quarter as for generated compared in volume of driven segments sales EBITDA the X.X% for this million

Our working of sales, end XXXX. the working of XXXX. $XX the second end end higher was the at XX% $XXX And cash at a of of of XXXX was capital than as was quarter second quarter excluding of percentage at million, it the million capital, the

capital of the year. our -- the the expect achieve to working XX% work by end targeted rest to year level capital of of the down inventory We level

the XXXX million fall. of We cash of quarter have in as $XX second begun inventory generated to from levels operations

cash outlook, raised our Given we've our revised guidance. flow

cash expenditure in XXXX. reduced half we approximately XXXX, the full of capital Capital and total to the $X the of operations for million million year expect $XXX in For million a $XX we expect for first guidance from now to to flow $XXX XXXX our the quarter million. generate $XX second expenditures $X and the total were million expenditures of of of capital million year,

outstanding of million million XXXX. XXXX. at $XXX X.Xx was quarter was second million to of debt up $XXX at X.Xx, debt $XXX the And the the Our compared our ratio leverage net the based at of end from of on end end

While X.Xx this still quarter. million bring the the facility $XX the to within to expect of at and $XXX our year. our second And have lending was stated by on availability end asset-based of target cash range, the the million, ratio we down in end we about

our updated guidance. XXXX Regarding

Andrew previous As and making mentioned we some reported. we from since my last changes comments, are

we and particularly a in customer We levels a annual seasonal this guidance challenging anticipated, resulted and change quarter historic increased quarter in cash second June, guidance. we seen patterns. saw behavior to This have lower decline, a in where leading revenue lower flow spending us than

a billion. this than of we've will lowered more modest continue we $X.XX The is range growth to lower now range and XXXX our between billion at as base expect be be in billion At however, midpoint, business, $X.XX implies XXXX; midpoint the revenue to $X.XX albeit level. our the

from now all a view, about point with XXXX. quarter third expect will expect the of we XXXX quarter sectors mid-single And to down decline, And be of each geographic of expect of digits. be sector Canada that the being three we the X% second the X% by the up of will to We segments geography, largest. from

still While nonrecurring by the business offset to declines upstream downstream expecting being and due in grow, to tempered is it projects. and a U.S. rate more is midstream

Our backlog the end plans quarter at the XXXX, than slowdown of $XXX of lower the customer in second large $XX million, end the and up the wrapping was spending of projects. reflecting XXXX million of

Our also million now million. and changed, $XXX be and it has we adjusted to EBITDA $XXX guidance expect between

now and the $X.XX we between EBITDA the midpoint to expect at XXXX, which in $X.XX earnings share LIFO not expense, lower the be Given has lower per and diluted changed.

second long-term In in had reflect summary, still in operating lower by we the more changed change our remainder on our We're tempered year, and expected. outlook behavior the our while swiftly to quarter came market capital and we've outlook shareholder value. costs lower and customer year than customer XXXX revised while business. And expectations full the year expectations for acting our objectives pursue underlying our spending given and of reflecting in growth strategic reducing modest to this expenditures continuing to

And we'll questions. with now that, take Operator? your

Operator

[Operator Instructions].

from JPMorgan. comes with of Meakim line the question Sean first Our

Sean Meakim

Jim, hard to a quarters the congratulations have here. time give few you glad a But more we I'm on retirement. still

James Braun

Thank you, Sean.

Sean Meakim

So many managing the been quarterly and the quarter the basis right service in months. obviously comes cash monthly and after. you're collections have in But maybe typically, companies a difficult then been manifest that as the ramp even mentioned. by to accounts, quarter. from summer E&Ps into in difficult within spending stay those Shortfall budgets. are seasonal seems a end on We've And hearing late a pretty door Jim their itself to quarter, seeing

behavior the some window-dressing as we how are in your and back the balance underpins really And about degree. about that in E&Ps the driving what of sheets the in Can guidance then think talk quarter? confidence year? these in updated works shifts shortfall you the customer of the half So some to their

Andrew Lane

finished and it Yes. Sean, add that, address let Jim some -- quarter very me the can finished comments. But disappointing.

talk Let to is years second, the revision played me out about second because step just outlook. the back our a this how

strong the the March for at in spending and spoke on us. we year, up a curtails quarter, January of had, and February picked last We last slow about as end December as nicely

the year us but first the And the So we end business a that quarter. outlook revise finish the our good for was what start upper that given a had first the slow guidance quarter. caused to after to then to of

at April, sequentially Second conference, first your quarter, when and were we even X% when -- we May, over up were we the quarter.

target. on was everything really, So

case in the and you ramps, as And been a us XX month. my here, from your years question July June good has as old mentioned is for

us in months Our summer falloff expected are in not construction surprised was revenues really and and really in good. What spending June. a falloff was

to way -- going me lower I in would at you than April not that June it's to the quarter If was our was that first thought customer been be and that going never be May, told all have base. with

a unique our ramp-up. unusual Jim June comments, in of carries mentioned little into that July bit instead as a patterns So historical very in -- his of decrease of a spending even very spending

first spending up the expectations late given caused the have year. the end So overall on to to environment in us turned quarter us that out the so the full for and would, results, then quarter, second reset slower the of negative in

will other we've the big us $XXX think. XXXX. us, about, CapEx revenue down impacting that U.S. first And After nonrecurring spending now us quarter, X% we far down up And impacted be and And of whole to then has expected unique U.S. had I project talked be we so expected spending to X%. we CapEx to overall discipline this in when then has definitely we E&P to industry, XX%. so be as million estimates spending started XX%. the customer it it thing The is year, latest

color three little million decline has nonrecurring. down revenue. in to those to $XX from compared second decline. that. ability that large about 'XX, of give 'XX been you quarter really the projects So overall of just second quarter replace those hampered the given In of is on And $XX we've to million spending projects a our we're talked

first business look to from When And million, 'XX last of $X at half $XXX three year down of 'XX, you our base actually to compared unique more others. grew to results decline was half you revenues the our the those million. but are when million compared So than us a $XXX year-on-year at our that's first look projects.

So major think contracts, overall in question, ramp-up think customers. even answer about the have by when part the will second look in And you large your things, our things two you spending we customer and were include -- I a that IOC there's and of us, to at really our expected half. to going the second

have half growth We of mainly the from offset contracts, we're in modest in increases that the contract new impact either going to second projects now to most spending. have contract the the the wins existing us year, or for But others. compared nonrecurring the

Sean Meakim

update forward? been decline pipe. margins helpful. sounds pricing tied in current particularly margins, going all quarter-to-quarter on So to On line G&A, we about the could pipe. like there of the makes the most really That's you line attributing gross the so environment, talk on you're managing of or trajectory But got sense. you've pressure It

You moving just about these you took the talk how pieces? can So maybe to going you're have down. manage guidance

Just understand the -- pieces us in let moving the margin of back the on pipe or -- the on gross sorry, line maybe year. half

Andrew Lane

Yes.

been price this demand But address me similar pipe can about But Let had talk standpoint. on steady and in from from declines also, market the a line a standpoint. pipe, We've overall line overall. an point them on, Jim situation. has spot

total revenue. our you when XX% pipe look a of So and at -- line is

down price at from last at it tons overall of basis you when a XX%. impact on moves, standpoint, from an end the demand margins. And has the on year, our the a is it When look you price XX%. it down when demand So look is

a profitability and both it's a -- earnings line to and in pipe. our price detrimental volume factors So

biggest the swing So that's been factor.

that prepared really pipe, has higher steel line not softened, that to Jim ago. run-up tariffs out. as domestic mills stick import a in the from really, demand mentioned comments, year of price his in been backed XXXX And did remarks the match has

product our industry biggest which So well that, would disappointing. we've expectations. other in really But term and valves the and performed very factor, seen the to I short Jim? have has been were seen that's pipe. and impacted say swing lines, on that, stainless, especially whole line the up has here we're the our

James Braun

add, through awards, higher-margin some of benefit we on I'd go Sean, to contract that we'll as the see Yes. year some of Andy we those the move back mix execute as from we the some products and half product mentioned. of

Operator

from line of the question next Marc with Cowen. Bianchi comes Our

Marc Bianchi

the the on quarter commentary benefit gross well. Would some is of you congratulations to of I retirement realized the as quarter? it Jim, in you And the margin gave fourth more -- that on a just just benefit the anticipate Or the contracts? in third mix half. for back be from new

James Braun

No.

I think you'll quarters. end the see that quarter. the It's into certainly back not loaded in both fourth

both. be should there So benefit in

Andrew Lane

my shop. And mentioned that in comments valve area is didn't Marc, one the I modification

the first We'll of we impact -- positive content. So valves in half had half content, manufacturing are higher already that facility, the year. ramp higher and that technical the been will one of our higher impact in and see both technical higher-margin second type that where businesses contain no

the even margins a our higher So we'll in than see for strategic opportunity growth midstream business base valves as us. valve

up the third into in ramp 'XX. in more ramp will us impact more our that We've invested fourth the in really quarter and facility and So expanding -- that will that and significantly midstream will valves.

We incremental valves revenue in you at expect 'XX as look million $XXX growth of that investment. and from 'XX midstream

Marc Bianchi

could? additional mentioned could of actions put you you're and provide on much how you the considered some what Okay. considering some some reduction that a there, guys looking if And at cost could we specifically restructuring. maybe being or be a have put Could -- in you more maybe out commentary result range

Andrew Lane

he we slowdown then as have -- address so customer rest because months. Attrition doing, June of But on the guidance that will cost hiring the we're what of I'll in Jim three will in start. July, done can you Marc. we've freeze year. carried and I'll just positively a point. the and at impact We've Yes, into has visibility the freeze for things. of this couple the give much spending as salary that also for

we've done several retirement package times as done, We also and program. have a before,

employees. the be employees So XXX year around end that programs. XXX from to we X,XXX expect have will reductions of by Jim? the our I those

James Braun

market soon. quite that at add, Yes. for at business. of just remarks coming Marc, look serving the from, it how back too we downsides prepared see mean further the in challenging We looking market actions I'll we That we're a frankly, anytime market. the we number that need And where we people is another I today. and serve that don't us, take to it mentioned in serve there, taking Canada some

another we're be looking going that's to So -- at. look

a little numbers. to premature probably some specific It's give

We acceptance in voluntary have expenses certainly, range. to guidance should be given, rate what But is that within we've we operating see the program. the the on retirement within the

Operator

next question from Vaishnav Howard Vaibhav line of Weil. the with comes Our

Vaibhav Vaishnav

Congratulations, up retirement. as all from guess is as Jim, to can. just far expense side like per sell following about? quarter Get given I on done, question is said million you corporate on unreasonable and away the Marc's $XXX that think number

James Braun

two within million that million, average certainly, Vebs, last about it a a quarter-to-quarter It be that range. from runs for may million fluctuate the a on $XXX quarters. but $XXX quarter on -- $XXX little basis,

Vaibhav Vaishnav

how think about to that's I we thinking that. have XXXX? with Sorry. was like should where these about actions cost was taken, And trying be going once I all

James Braun

you. misunderstood I apologize. I

So that I from run probably in second we've should it's I year-over-year think fact of on process. a put so basis, half the were -- the with little come the number just those the as see taken, of a actions at least to certainly on yet mentioned given a early, cost mature down year we we've that a But that rate. middle costs

Vaibhav Vaishnav

Got it.

if U.S. about Can that? what sense. about for any Okay. up XX%. just the think it, completions about, help I shares customer-specific dynamics, me makes about think down it activity, call And Despite market it, upstream you were was X%, that Any issues? revenues drove X%.

Andrew Lane

Yes, Vebs.

As you revenues years, we U.S. count completion as track and we -- our basis. know, we our five, track percentage have with a U.S. from very tightly the upstream seven

had very second completions. unusual, was in the a X% X% it so And increase overall where or we quarter,

we -- but customers realized think wells, We was Our market expansions U.S. previous already down revenue had a battery don't was had We from X%. in upstream quarters. share lot of revenue tank had it the the complete differences. they

an overall So I think change. it's don't

where the a I think up. line it's single revenues just didn't quarter

we expansions lines, do wells. than flow tank just battery more course, do we Of revenues connecting in in

our it the completions think that And second first half XX%. I the U.S. are time that quarter. And the upstream X%. And up was half was So 'XX, year-to-date, when unique specific in from and in our overall. first comparative -- so for customers is up quarter. a to activities look really very was at 'XX you But

we're swing in The think the Permian. I So tracking big closer. was

going Permian the in customers big an acquisition. two have through we Now

I because XX% think in unusual sequentially, we've for in slow But company's us which up we to time upstream year-to-date, seen as would getting every were Permian, we're is very that spending acquisitions. upstream. and the down XX% there

completing circumstances U.S. mix return think But half the percentage some I will customer overall certainly we the and it's to feel unique, pretty during with close in well So quarter. the to tracking was the completion second like the

Vaibhav Vaishnav

Okay.

That's -- it. Got squeeze of one more And helpful. in more a normalization. if ask I was may it's question. So

thinking are term how What U.S. any have and that? about made? with conversations all about there progress the Coast Just -- Gulf infrastructure, been going the thinking longer on

Andrew Lane

we activity. Yes, mean largely from Vebs. I we'll of lot that still benefit --

refining expansion. have Motiva You the

CP -- the Chem have You petrochemical project. chemical

on -- You capabilities large refining have expansion -- expand chemical Corpus we customers last of did year, Rouge to our to Exxon, last SABIC, in Baton Louisiana serve project. we and quarter the chemical. South and a All

of Porte So big course, you know expansion. -- about La and our then,

really very in them revenues position, a we're but those good half So the We for from projects. And -- timing underway 'XX, contract which is That's position. us, now, when a are those issue. All we'll end facility the they towards our and out where personnel purchase from second good projects just and we'll 'XX. benefit really we of of of hit be big in 'XX, see stock. a

short-term good from doesn't it's have impact a news longer-term on a It perspective. us. So big

Operator

questions to like are There management further no queue. hand for in I'd to the closing call the back comments.

Monica Broughton

in in for Global. and you third today and conference a your look forward for us interest for good you goodbye. day, quarter join We November. having to MRC us Thank call Have joining our

Operator

gentlemen, and Thank your conclude you for Ladies does this teleconference. today's participation.

and disconnect day. may time, at a your lines this wonderful have You

MRC Global (MRC) 2 Aug 192019 Q2 Earnings call transcript