TISI - Earnings call transcript Q2 2024

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Operator

Good day, and welcome to the Team, Inc.

Second Quarter update conference call. [Operator Instructions] Please note that today's event is being recorded. I would now like to turn the conference over to Nelson Haight, CFO. Please proceed, sir.

Nelson Haight

operator. you, Thank and everyone, the Inc. Team Good welcome morning, to XXXX financial results. discussion about and quarter second our operational

On today Financial and myself, the Executive Nelson Chief discussion Haight, are Keith the Chief Officer. our Tucker, Officer

company's their that outside flow I want statements, without outlook, and control. expense, expense, future those limitation, taxes, commentary of operating by may revenue, margin, income include business including, gross management's nature, regarding other to and forward-looking today adjusted the are you uncertain remind and EBITDA, which, cash

statements forward-looking management's expectations these on Although are differ current and based may results materially. beliefs, actual

For Exchange forward-looking of that and section annual a please along statements as earnings associated their Commission, any of results assumes discussion refer of cause dates. differ, speak and latest Inc.'s quarterly some with obligation or of our filings the risk to to Team Factors which respective update Team release. could filed factors to with information, no Risk the Securities actual the

during financial a reminder, a As release. our referenced reconciliation is the non-GAAP available in earnings measures this of call

turn I our Tucker, Executive Chief that, to Keith it With Officer. over will

Keith Tucker

I our provides a and an Welcome, commentary me. to rich as Thank results. reintroduction in and May, review we our encourage second additional thank accomplishments with everyone, you and history and record quarter would In to capabilities. it for listen you, a industry. Team, to our has updated Team Nelson. Nelson presentation impressive information everyone strategy it recent as to posted market-leading on our joining an in track by

and internal in took faced I number we external of when as challenges. CEO XXXX, However, over a

map future. have Team better we to past road succeed two Over been to executing the years, position a in order the in strategic

continued our we the to we and work once sheet, expanding costs, again. With demonstrated our to simplified progress to the quarter margins and positioned and results, margins, respect flow positive built first capital have improving established balance We second grow during we in are off well lowering cash momentum business, structure the and our generation. quarter improved address

margin and improved grew year $X over gross the million, the dollars nearly gross to margin quarter, $XX.X million For period. second XXX basis prior points our

Our million of costs the expense, period contributed adjusted administrative over consolidated a prior cash and $X and that and EBITDA X.X% were $XX.X up million, selling, from quarter which to period. rough measure revenue lower SG&A these margin year of the adjusted adjusted general expanded for the XXXX an of EBITDA to XX% factors is

lower led to that margin to efforts can ongoing have continue build upon. to costs expansion Our believe we we

previously, to our grow goal a more, been has EBITDA significant our As noted towards half adjusted we this margins are and to achieving have first step goal. XX% results or

the growth designed remain we markets, markets and XXXX. midstream revenue during While progress core continue higher discipline as focused half to drive of quarter, our of to strengthen accelerate traction, aerospace the second expect in initiatives such discipline. meaningful see and commercial and targeted gain we margin These series to on we and end a our and our launched commercial second cost initiatives into within growth expansion execution, operational higher

by continue We that facility up in Cincinnati further aerospace our demand and our to XX%, will in state-of-the-art expand recently investment that an strong XXXX. at aerospace facility see incremental end approved with we capacity of revenue the

higher-margin segments and mix, further additions sectors. in also strategic made Our Aerospace that we an pleased increased the revenue I'm driven with note by improving attractive job our operations to results are pricing. growth benefiting also in to these on Midstream drive stronger an management high-margin streams from to focus team recently

cash and shareholder further strengthen to on growth, emphasis enhanced our financial together value. expect accelerate our actions, these leading cost We with flow to position continued ultimately our efficiency

in particularly strong the first the activity of further versus as our half turnaround activity performance and improvement financial from Canadian second in half work to see XXXX well performance we XXXX, margin improved across project-related as ahead and of Looking segments, our levels operations. expect and both international

these commercial XXXX of as line second growth to top our traction initiatives We the expect in year. the together on provide growing compared factors, prior with half to

All to continue a turn of strong trajectory. With quarter opportunity these our XXXX and million take want I and adjusted Nelson sharply it guidance the at efforts midpoint our XX% accomplishments. half point solid full financial to is positive year results, With remain that trajectory that, to between and on XXXX. $XX and we improvement second improving would and have hit financial performance remain track over balance $XX resulted sheet. I in focused representing over on strengthening this to continuing our our guidance out to operational EBITDA and this million this to we on discuss first results, like this

Nelson Haight

you you, and Thank our Keith, thank joining call. for

margin, significantly. progress increased all results Our basis and to our operating date revenue, margin our second year-over-year EBITDA lower slightly confirm We to our quarter gross by gross adjusted XXX made XXXX margins. points improving income our Despite improved XX.X%. in

cash Our XX% by on operating EBITDA $XX.X operating almost to by and We $XX from million XXX%. a basis. year-over-year million, income adjusted flow increased improved activities by grew

performance the Our operational financial year. consolidated our of net $X.X for second loss million continue million, first improvement half over and the that XXXX was XXXX solid into the the period. We will $XX a quarter believe half

the streamline map improve in to out laid strategic we operations. May confident our are in structure We cost our road and

a flow. benefit margins expect our will sustainable program and further to demonstrate cash We ongoing

results can we map. pointed our business improved out, in of years, profitability. the strategic worked execution the seen efforts X-plus Keith focus to As and stabilize our last be road the our which on over The of

XXXX well our our EBITDA XXXX and from XX% XXXX our results. rate increased to strong midpoint a the are given since first to quarter of our adjusted compounded of XXXX with half which second every year annual guidance, we have way We achieving, growth on

years. XXXX adjusted period the guidance has our six in at margin of In highest margin EBITDA represent our would the midpoint dramatically same margin improved our addition, over at least and the

path or our a near importantly, achieving of XX% the clear goal see adjusted toward More more margin EBITDA a in future. we

would We while debt generation and ratio down. strengthen expect liquidity balance flow also pay for increased further leverage the that lowering provide allowing and our improved sheet, cash EBITDA to

continue on priorities our We working which our and debt to XXXX. are in maturity, on these address of August is to next already plan work

would I supportive like not see only know to thank our are inherent but and map. strategic stakeholders business road with our potential our who the aligned

build year the on We full seen foot, in off have on started positive outlook. which XXXX and this can expect momentum, we the to our be right year

grow allow growth for portfolio adjusted and efforts highly to margin margin and incremental expansion are on savings accretive. further project margin that EBITDA be and with revenue cost We high-grading focused continue our to will our

XXXX as As are the compared projecting a XXXX. Keith XX% in to outlook stated earlier, increase at of we our midpoint EBITDA adjusted

our in the ability now compared of a successful improved execution we to are I'm vision. much to were in where our ago, continue We three position years confident strategic and

results with We will closing that, to me to deliver lead let expect Keith excited back are for that turn and over some shareholder improved we value. And it to growth comments.

Keith Tucker

Nelson. Thanks,

we business. are overall that We made encouraged our with the progress the of and trajectory have

more believes with have accomplished for can there's see, play a leadership team this, to lot, we you quite bit here. a As

vital workforce strategic safety value of unlocking that experienced in plan a franchise. is inherent squarely the not our day, continuous and focus I'm our very is believe the people because on executing most we no of our the is too be done at end and and have this committed asset, We our focused safely. improvement to are and on culture job our important proud

commitment team. this a our their capabilities, without be leadership believer I want safe and to of talented employees possible operational and work None I our and employees this them. for hard operations. Team, firm to thank am would dedication,

value believe Team. is inherent unlock a is there opportunity In closing, to I in further that meaningful that the

years some results. through underperformance clear of believe X.X results period The fixing we encouraging we we strategy and and the are without the profitably yielded into but gone XXXX are a remainder delivering not past and sustainably have of work the over we've done We Team positioned and are has well for clear to grow that, future. we that focus and only a a improving

and joining interest us Thank in continued you your for today Team.

Operator

disconnect. has now conference attending today's may Thank concluded. for presentation, now you The and you

Team (TISI) 9 Aug 242024 Q2 Earnings call transcript