Investors

Investor Relations

Leading the way globally in providing integrated, digitally-enabled asset performance assurance and optimization solutions.

Home   >   Investors   >   Team, Inc. Reports Fourth Quarter And Full Year 2021 Results

Press Release

Team, Inc. Reports Fourth Quarter And Full Year 2021 Results

03/16/22

Fourth Quarter 2021 Revenue Increased 8% Over Fourth Quarter 2020
IHT Achieved 17% Revenue Growth over 4Q 2020
MS Delivered a 5% Revenue Increase in 4Q 2021 over 4Q 2020

SUGAR LAND, Texas, March 16, 2022 /PRNewswire/ -- Team, Inc. (NYSE: TISI) ("TEAM" or the "Company"), a global leading provider of integrated, digitally-enabled asset performance assurance and optimization solutions, today reported its financial results for the fourth quarter and full year ended December 31, 2021.

  • Fourth quarter 2021 revenues were $224 million, an increase of 8% over the prior year quarter and a 3% sequential improvement
  • Full year 2021 revenues increased 3% to $875 million, primarily attributable to Nested, Projects & Turnarounds, and International areas
  • Inspection & Heat Treating Segment delivered $105 million in revenue during the fourth quarter 2021, a 17% increase over the prior year period
  • Mechanical Services Segment grew fourth quarter 2021 revenue to $97.9 million, or 5% more than the $93.4 million reported in the fourth quarter of 2020
  • Entered into a $50 million Subordinated Term Loan that provided runway for the successful comprehensive refinancing of the Company's capital structure in February 2022
  • The February 2022 refinancing included a new $165 million credit facility, consisting of $130 million revolving facility and $35 million delayed draw term loan, plus $10 million of incremental unsecured funding, and an additional $10 million equity investment

"Like many other companies, 2021 challenged us in unprecedented ways," said Amerino Gatti, TEAM's Chairman and Chief Executive Officer. "While fourth quarter revenues were up 8% over 2020, our results were negatively impacted by lingering COVID-related pricing concessions given to our clients, the effects of the underlying labor and supply chain inflationary pressures, and higher expenses associated with the elimination of certain of the pandemic-related cost actions.

"The Inspection and Heat-Treating Segment delivered fourth quarter revenue growth of 17% over the prior year quarter, primarily driven by higher activity levels at our nested sites and an increase in turnaround projects in North America. Our turnaround and capital project activity increased later in the year as our clients began to return to a more stable operating environment. 

"The Mechanical Services Segment delivered fourth quarter revenue growth of 5% over the prior year quarter, primarily from higher activity levels in projects and turnarounds, partially offset by lower callout activity.  While MS revenue is trending in the right direction, our priority is to enhance margins and capture market share in our key product and service lines.

"Quest Integrity's revenues declined in the fourth quarter when compared to the same quarter in 2020 due to pandemic‑related international travel restrictions and project delays.  As previously reported, Quest had more than $20 million of projects delayed or deferred from 2021, and when combined with recent increases in quoting activity, creates strong opportunities for the year. To meet this forecasted demand, we are proactively and aggressively recruiting project managers and technical sales globally while investing in technology development.

"During the quarter, we executed on our plan to ensure stability and agility throughout the Company, including cash management, liquidity enhancement, and especially investing in our talented people. Going forward, management will continue to focus on revenue and margin growth, end market diversification, and our operational and financial turnaround initiatives.  Additionally, we are evaluating strategic options and alternatives to maximize shareholder value.

"Looking ahead, we remain committed to continuing our capital strengthening priorities to support the future growth of the Company.  We will use stringent fiscal discipline to execute on our growth plan while further streamlining our cost structure in support of our field operations. TEAM is well positioned to capitalize on the rebounding end market demand in 2022 and beyond," Mr. Gatti concluded.

Financial Results

Consolidated revenues for the fourth quarter of 2021 were $223.7 million compared to $207.3 million in the prior year quarter. Despite revenue increasing due to a strong October, during the quarter we also experienced lower activity levels in some of our end markets due to weather and a weaker holiday season, which was further impacted by continued market volatility. In the fourth quarter of 2021, consolidated gross margin was $54.6 million, or 24.4%, down from 29.0%, or $60.1 million,  in the same quarter a year ago, primarily due to temporary COVID-related pricing concessions and inflationary impacts.

Consolidated net loss in the fourth quarter of 2021 was $43.1 million ($1.38 loss per diluted share) compared to net loss of $14.9 million ($0.48 loss per diluted share) in the fourth quarter of 2020. Consolidated Adjusted EBITDA, a non-GAAP measure, was $1.6 million for the fourth quarter of 2021 compared to $13.1 million for the prior year quarter. (See the accompanying reconciliation of non-GAAP measures at the end of this earnings release.)

SG&A for the fourth quarter was $70.7 million, up $8.2 million, or 13.1%, from the fourth quarter of 2020 due in part to the reinstatement of the temporary cost reduction actions that were put in place in March 2020. The Company's adjusted measure of net income/loss, Consolidated Adjusted EBIT, was a loss of $9.9 million in the fourth quarter compared to a loss of $0.4 million in the prior year comparable quarter. 

Fourth quarter 2021 reported results include certain net charges not indicative of Team's core operating activities consisting of a non-cash, pre-tax goodwill impairment charge of $8.8 million recorded in the Quest Integrity segment, $0.3 million of severance charges, and $6.2 million of certain professional fees, legal and other non-recurring costs.  Net of tax, these items totaled $15.3 million or $0.49 per diluted share.

For the full year 2021, consolidated revenues were $874.6 million, up 3% compared to $852.5 million in 2020. Net loss was $186.0 million, or $6.01 loss per diluted share, compared to a net loss of $237.2 million, or $7.74 loss per diluted share in 2020. The 2021 net loss includes pre-tax, non-cash, goodwill impairment charges of $8.8 million and $55.8 million associated with the Company's Quest and Mechanical Segments, respectively.  The 2020 net loss includes a pre-tax, non-cash, goodwill impairment charge of $191.8 million associated with the Company's IHT segment.  On an after-tax basis, the 2020 goodwill charge was $178.6 million or $5.83 per diluted share.  Consolidated Adjusted EBITDA, a non-GAAP measure, was $6.4 million for the full year 2021 compared to $40.0 million in 2020. Net cash used in operating activities was $35.5 million in 2021, compared to net cash provided by operating activities of $52.8 million in 2020. 

Adjusted net loss, consolidated adjusted EBIT, consolidated adjusted EBITDA and free cash flow are non-GAAP financial measures that exclude certain items that are not indicative of Team's core operating activities. A reconciliation of these non-GAAP financial measures to the most comparable GAAP financial measures is at the end of this release.

Segment Results

The following table illustrates the composition of the Company's revenue and operating income (loss) by segment for the quarters ended December 31, 2021 and 2020 (in thousands):

TEAM, INC. AND SUBSIDIARIES

SEGMENT INFORMATION

(unaudited, in thousands)

         
   

Three Months Ended
December 31,

 

Twelve Months Ended
December 31,

   

2021

 

2020

 

2021

 

2020

Revenues

               

IHT

 

$        105,294

 

$          89,748

 

$        415,371

 

$        374,740

MS

 

97,860

 

93,407

 

378,826

 

392,484

Quest Integrity

 

20,498

 

24,148

 

80,356

 

85,315

   

$        223,652

 

$        207,303

 

$        874,553

 

$        852,539

                 

Operating income (loss) ("EBIT")

               

IHT

 

$            2,173

 

$            5,052

 

$          12,997

 

$       (174,638)

MS

 

3,071

 

5,377

 

(47,728)

 

25,879

Quest Integrity

 

(6,252)

 

6,673

 

900

 

16,474

Corporate and shared support services

 

(24,154)

 

(19,463)

 

(92,151)

 

(85,077)

   

$         (25,162)

 

$           (2,361)

 

$       (125,982)

 

$       (217,362)

The increase in year-over-year revenues for IHT and MS for the three months ended 12/31/21 was due to higher demand for the Company's services, particularly in October, which was then partially offset by a slow holiday season and continued market uncertainty.

Given the nature and locality of Quest Integrity's business, Quest Integrity was particularly impacted by the pandemic as stay-at-home orders limited travel and necessitated quarantine restrictions. The travel restrictions resulted in many of Quest Integrity's fourth quarter projects getting delayed until the first quarter of 2022 or later in the year. 

Quarterly Earnings Conference Call

The Company will not host an earnings call this quarter due to its previously announced strategic review process and ongoing execution of its operational and financial turnaround plan.

Cash and Debt

Consolidated cash and cash equivalents were $65.3 million at December 31, 2021 (including $4.1 million of restricted cash for the Atlantic Park Term Loan), compared to $24.6 million at year end 2020. The Company's net debt (total debt less cash and cash equivalents) was $339.9 million at December 31, 2021, compared to $287.6 million at December 31, 2020.

Non-GAAP Financial Measures

The non-GAAP measures in this earnings release are provided to enable investors, analysts and management to evaluate Team's performance excluding the effects of certain items that management believes impact the comparability of operating results between reporting periods. These measures should be used in addition to, and not in lieu of, results prepared in conformity with generally accepted accounting principles (GAAP). A reconciliation of each of the non-GAAP financial measures to the most directly comparable historical GAAP financial measure is contained in the accompanying schedule for each of the fiscal periods indicated.

About Team, Inc.

Headquartered in Sugar Land, Texas, Team Inc. (NYSE: TISI) is a global leading provider of integrated, digitally-enabled asset performance assurance and optimization solutions. We deploy conventional to highly specialized inspection, condition assessment, maintenance and repair services that result in greater safety, reliability and operational efficiency for our client's most critical assets. Through locations in more than 20 countries, we unite the delivery of technological innovation with over a century of progressive, yet proven integrity and reliability management expertise to fuel a better tomorrow. For more information, please visit www.teaminc.com.

Certain forward-looking information contained herein is being provided in accordance with the provisions of the Private Securities Litigation Reform Act of 1995. We have made reasonable efforts to ensure that the information, assumptions, and beliefs upon which this forward-looking information is based are current, reasonable, and complete. However, such forward-looking statements involve estimates, assumptions, judgments, and uncertainties. They include but are not limited to statements regarding the Company's financial prospects and the implementation of cost saving measures. There are known and unknown factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking information. Although it is not possible to identify all of these factors, they include, among others, the duration and magnitude of accidents, extreme weather, natural disasters, and pandemics (such as COVID-19) and related economic effects, the Company's liquidity and ability to obtain additional financing, the Company's ability to continue as a going concern, the Company's ability to execute on its cost management actions, the impact of new or changes to existing governmental laws and regulations and their application, including tariffs and COVID-19 vaccination requirements; the outcome of tax examinations, changes in tax laws, and other tax matters; foreign currency exchange rate and interest rate fluctuations; the Company's ability to successfully divest assets on terms that are favorable to the Company; our ability to repay, refinance or restructure our debt and the debt of certain of our subsidiaries; anticipated or expected purchases or sales of assets; the Company's continued listing on the New York Stock Exchange, and such known factors as are detailed in the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, each as filed with the Securities and Exchange Commission, and in other reports filed by the Company with the Securities and Exchange Commission from time to time. Accordingly, there can be no assurance that the forward-looking information contained herein, including statements regarding the Company's financial prospects and the implementation of cost saving measures, will occur or that objectives will be achieved. We assume no obligation to publicly update or revise any forward-looking statements made today or any other forward-looking statements made by the Company, whether as a result of new information, future events or otherwise, except as may be required by law.

Contact:
Christopher Robinson, CFA
Vice President, Corporate Development & Investor Relations
(281) 388-5551

TEAM, INC. AND SUBSIDIARIES

SUMMARY OF CONSOLIDATED OPERATING RESULTS

(in thousands, except per share data)

         
   

Three Months Ended

 

Twelve Months Ended

   

December 31,

 

December 31,

   

2021

 

2020

 

2021

 

2020

   

(unaudited)

 

(unaudited)

 

(unaudited)

   

Revenues

 

$           223,652

 

$           207,303

 

$           874,553

 

$           852,539

Operating expenses

 

169,003

 

147,159

 

660,118

 

613,828

Gross margin

 

54,649

 

60,144

 

214,435

 

238,711

Selling, general and administrative expenses

 

70,714

 

62,505

 

272,869

 

260,920

Restructuring and other related charges, net

 

302

 

 

2,916

 

3,365

Goodwill impairment charge

 

8,795

 

 

64,632

 

191,788

Operating loss

 

(25,162)

 

(2,361)

 

(125,982)

 

(217,362)

Interest expense, net

 

17,340

 

7,971

 

46,308

 

29,818

Loss on debt extinguishment and modification

 

 

2,224

 

 

2,224

Loss on warrants

 

59

 

 

59

 

Other (income) expense, net

 

(1,293)

 

1,222

 

2,461

 

2,514

Loss before income taxes

 

(41,268)

 

(13,778)

 

(174,810)

 

(251,918)

Less: Provision (benefit) for income taxes

 

1,785

 

1,097

 

11,209

 

(14,715)

Net loss

 

$            (43,053)

 

$            (14,875)

 

$         (186,019)

 

$         (237,203)

                 

Loss per common share:

               

Basic and diluted

 

$                (1.38)

 

$                (0.48)

 

$               (6.01)

 

$               (7.74)

                 

Weighted-average number of shares outstanding:

               

Basic and diluted

 

31,100

 

30,753

 

30,975

 

30,638

 

TEAM, INC. AND SUBSIDIARIES

SUMMARY CONSOLIDATED BALANCE SHEET INFORMATION

(in thousands)

       
 

December 31,

 

December 31,

 

2021

 

2020

 

(unaudited)

   
       

Cash and cash equivalents

$           65,315

 

$           24,586

       

Other current assets

287,743

 

259,146

       

Property, plant and equipment, net

161,359

 

170,309

       

Other non-current assets

190,068

 

276,934

       

Total assets

$         704,485

 

$         730,975

       

Current portion of long-term debt and finance lease obligations

$               669

 

$               337

       

Other current liabilities

183,456

 

132,667

       

Long-term debt and finance lease obligations, net of current maturities

405,191

 

312,159

       

Other non-current liabilities

63,302

 

71,209

       

Stockholders' equity

51,867

 

214,603

       

Total liabilities and stockholders' equity

$         704,485

 

$         730,975

 

TEAM INC. AND SUBSIDIARIES

SUMMARY CONSOLIDATED CASH FLOW INFORMATION

(in thousands)

     
   

Twelve Months Ended December 31,

   

2021

 

2020

   

(unaudited)

   
         

Net loss

 

$            (186,019)

 

$            (237,203)

         

Depreciation and amortization expense

 

41,518

 

45,908

         

Allowance for credit losses

 

1,943

 

1,612

         

Deferred income taxes

 

4,521

 

(3,974)

         

Non-cash compensation cost

 

7,013

 

6,307

         

Goodwill impairment charge

 

64,632

 

191,788

         

Loss on warrants

 

59

 

         

Working capital changes

 

18,832

 

37,348

         

Other items affecting operating cash flows

 

12,048

 

10,978

         

Net cash (used in) provided by operating activities

 

(35,453)

 

52,764

         

Capital expenditures

 

(17,605)

 

(19,958)

         

Cash used for business acquisitions, net

 

 

(1,013)

         

Proceeds from disposal of assets

 

3,528

 

2,645

         

Other items affecting investing cash flow

 

 

25

         

Net cash used in investing activities

 

(14,077)

 

(18,301)

         

Payments under Credit Facility revolver

 

 

(76,638)

         

Borrowings under ABL Facility, net

 

62,000

 

         

Borrowings under ABL Facility, gross

 

128,000

 

44,000

         

Payments under ABL Facility, gross

 

(137,000)

 

(35,000)

         

Borrowings under Subordinated term loan

 

50,000

 

         

Payments under Credit Facility term loan, net

 

 

(50,000)

         

Borrowings under Term loan, net

 

 

242,500

         

Repayments of convertible debt

 

 

(135,501)

         

Payments for debt issuance costs

 

(10,457)

 

(9,113)

         

Taxes paid for net share settlement of share-based awards

 

(240)

 

(990)

         

Other items affecting financing cash flows

 

(453)

 

(2,719)

         

Net cash provided by (used in) financing activities

 

91,850

 

(23,461)

         

Effect of exchange rate changes

 

(1,591)

 

1,409

         

Net change in cash and cash equivalents

 

$               40,729

 

$               12,411

 

TEAM, INC. AND SUBSIDIARIES

SEGMENT INFORMATION

(unaudited, in thousands)

         
   

Three Months Ended

December 31,

 

Twelve Months Ended

December 31,

   

2021

 

2020

 

2021

 

2020

Revenues

               

IHT

 

$        105,294

 

$          89,748

 

$        415,371

 

$        374,740

MS

 

97,860

 

93,407

 

378,826

 

392,484

Quest Integrity

 

20,498

 

24,148

 

80,356

 

85,315

   

$        223,652

 

$        207,303

 

$        874,553

 

$        852,539

                 

Operating income (loss) ("EBIT")

               

IHT

 

$            2,173

 

$            5,052

 

$          12,997

1

$       (174,638)

MS

 

3,071

 

5,377

2

(47,728)

 

25,879

Quest Integrity

 

(6,252)

 

6,673

3

900

 

16,474

Corporate and shared support services

 

(24,154)

 

(19,463)

 

(92,151)

 

(85,077)

   

$         (25,162)

 

$           (2,361)

 

$       (125,982)

 

$       (217,362)

                 

Segment Adjusted EBIT

               

IHT

 

$            2,259

 

$            5,498

 

$          13,658

 

$          18,743

MS

 

3,101

 

5,432

 

8,633

 

29,406

Quest Integrity

 

2,626

 

6,864

 

10,052

 

16,991

Corporate and shared support services

 

(17,878)

 

(18,150)

 

(74,462)

 

(77,328)

   

$           (9,892)

 

$              (356)

 

$         (42,119)

 

$         (12,188)

                 

Segment Adjusted EBITDA

               

IHT

 

$            5,330

 

$            9,051

 

$          26,617

 

$          33,634

MS

 

8,169

 

10,889

 

29,133

 

51,260

Quest Integrity

 

3,226

 

7,709

 

12,668

 

20,578

Corporate and shared support services

 

(15,078)

 

(14,572)

 

(62,006)

 

(65,445)

   

$            1,647

 

$          13,077

 

$            6,412

 

$          40,027

                 
 

___________________

1

Includes goodwill impairment charge of $191.8 million for the twelve months ended December 31, 2020. Excluding the goodwill impairment charge, operating income for IHT would be $17.2 million for the twelve months ended December 31, 2020.

2

Includes goodwill impairment charge of $55.8 million for the twelve months ended December 31, 2021. Excluding the goodwill impairment charge, operating income for MS would be $7.5 million for the twelve months ended December 31, 2021.

3

Includes goodwill impairment charge of $8.8 million for the twelve months ended December 31, 2021. Excluding the goodwill impairment charge, operating income for Quest would be $11.5 million for the twelve months ended December 31, 2021.

TEAM, INC. AND SUBSIDIARIES
Non-GAAP Financial Measures
(Unaudited)

The Company uses supplemental non-GAAP financial measures which are derived from the consolidated financial information including adjusted net income (loss); adjusted net income (loss) per diluted share, earnings before interest and taxes ("EBIT"); adjusted EBIT (defined below); adjusted earnings before interest, taxes, depreciation and amortization ("adjusted EBITDA") and free cash flow to supplement financial information presented on a GAAP basis.

The Company defines adjusted net income (loss), adjusted net income (loss) per diluted share and adjusted EBIT to exclude the following items: costs associated with our OneTEAM program, costs associated with the Operating Group Reorganization, non-routine legal costs and settlements, restructuring charges, certain severance charges, goodwill impairment charges and certain other items that we believe are not indicative of core operating activities. Consolidated adjusted EBIT, as defined by us, excludes the costs excluded from adjusted net income (loss) as well as income tax expense (benefit), interest charges, foreign currency (gain) loss, and items of other (income) expense. Consolidated adjusted EBITDA further excludes from consolidated adjusted EBIT depreciation, amortization and non-cash share-based compensation costs. Segment adjusted EBIT is equal to segment operating income (loss) excluding costs associated with our OneTEAM program, costs associated with the Operating Group Reorganization, non-routine legal costs and settlements, restructuring charges, certain severance charges, goodwill impairment charges and certain other items as determined by management. Segment adjusted EBITDA further excludes from segment adjusted EBIT depreciation, amortization, and non-cash share-based compensation costs. Free cash flow is defined as net cash provided by (used in) operating activities minus capital expenditures. Net debt is defined as the sum of the current and long-term portions of debt, including finance lease obligations, less cash and cash equivalents.

Management believes these non-GAAP financial measures are useful to both management and investors in their analysis of our financial position and results of operations. In particular, adjusted net income (loss), adjusted net income (loss) per diluted share, consolidated adjusted EBIT, and consolidated adjusted EBITDA are meaningful measures of performance which are commonly used by industry analysts, investors, lenders and rating agencies to analyze operating performance in our industry, perform analytical comparisons, benchmark performance between periods, and measure our performance against externally communicated targets. Our segment adjusted EBIT and segment adjusted EBITDA is also used as a basis for the Chief Operating Decision Maker to evaluate the performance of our reportable segments. Free cash flow is used by our management and investors to analyze our ability to service and repay debt and return value directly to stakeholders.

Non-GAAP measures have important limitations as analytical tools, because they exclude some, but not all, items that affect net earnings and operating income. These measures should not be considered substitutes for their most directly comparable U.S. GAAP financial measures and should be read only in conjunction with financial information presented on a GAAP basis. Further, our non-GAAP financial measures may not be comparable to similarly titled measures of other companies who may calculate non-GAAP financial measures differently, limiting the usefulness of those measures for comparative purposes. The liquidity measure of free cash flow does not represent a precise calculation of residual cash flow available for discretionary expenditures. Reconciliations of each non-GAAP financial measure to its most directly comparable GAAP financial measure are presented below.

TEAM, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(unaudited, in thousands except per share data)

         
   

Three Months Ended

December 31,

 

Twelve Months Ended

December 31,

   

2021

 

2020

 

2021

 

2020

                 

Adjusted Net Loss:

               

Net loss

 

$         (43,053)

 

$         (14,875)

 

$        (186,019)

 

$        (237,203)

Professional fees and other1

 

5,775

 

1,076

 

8,882

 

5,062

Legal costs2

 

398

 

21

 

7,243

 

1,947

Severance charges, net3

 

302

 

876

 

3,106

 

5,877

Natural disaster costs4

 

 

 

 

500

Loss on debt extinguishment

 

 

2,224

 

 

2,224

Loss on warrants

 

59

 

 

59

 

Goodwill impairment charge

 

8,795

 

 

64,632

 

191,788

Tax impact of adjustments and other net tax items5

 

(17)

 

(881)

 

(385)

 

(16,491)

Adjusted net loss

 

$         (27,741)

 

$         (11,559)

 

$        (102,482)

 

$         (46,296)

                 

Adjusted net loss per common share:

               

Basic and diluted

 

$             (0.89)

 

$             (0.38)

 

$             (3.31)

 

$             (1.51)

                 

Consolidated Adjusted EBIT and Adjusted EBITDA:

               

Net loss

 

$         (43,053)

 

$         (14,875)

 

$        (186,019)

 

$        (237,203)

Provision (benefit) for income taxes

 

1,785

 

1,097

 

11,209

 

(14,715)

Interest expense, net

 

17,340

 

7,971

 

46,308

 

29,818

Foreign currency loss 7

 

1,400

 

1,117

 

5,674

 

2,758

Pension expense (credit)6

 

(102)

 

137

 

(622)

 

(244)

Gain on disposal

 

(2,591)

 

 

(2,591)

 

Loss on debt extinguishment and modification

 

 

2,224

 

 

2,224

Loss on warrants

 

59

 

 

59

 

Professional fees and other1

 

5,775

 

1,076

 

8,882

 

5,062

Legal costs2

 

398

 

21

 

7,243

 

1,947

Severance charges, net3

 

302

 

876

 

3,106

 

5,877

Natural disaster costs4

 

 

 

 

500

Goodwill impairment charge

 

8,795

 

 

64,632

 

191,788

Consolidated Adjusted EBIT

 

(9,892)

 

(356)

 

(42,119)

 

(12,188)

Depreciation and amortization

               

Amount included in operating expenses

 

4,819

 

5,588

 

20,210

 

23,105

Amount included in SG&A expenses

 

5,283

 

5,611

 

21,308

 

22,803

Total depreciation and amortization

 

10,102

 

11,199

 

41,518

 

45,908

Non-cash share-based compensation costs

 

1,437

 

2,234

 

7,013

 

6,307

Consolidated Adjusted EBITDA

 

$            1,647

 

$           13,077

 

$             6,412

 

$           40,027

                 

Free Cash Flow:

               

Cash provided by (used in) operating activities

 

$                408

 

$           32,599

 

$         (35,453)

 

$           52,764

Capital expenditures

 

(5,229)

 

(3,274)

 

(17,605)

 

(19,958)

Free Cash Flow

 

$           (4,821)

 

$           29,325

 

$         (53,058)

 

$           32,806

 

____________________________________

1

For the three and twelve months ended December 31, 2021, includes $0.2 million and $1.9 million, respectively, of costs associated with the Operating Group Reorganization (exclusive of restructuring costs). There were also $3.9 million related to costs associated with debt financing, $2.8 million of corporate support costs, and $0.3 million associated with the OneTEAM program (exclusive of restructuring costs). For the three and twelve months ended December 31, 2020, includes $0.6 million and $3.2 million, respectively, associated with the OneTEAM program (exclusive of restructuring costs).

2

For the three and twelve months ended December 31, 2021, primarily relates to accrued legal matters and other legal fees. For the three months and twelve months ended December 31, 2020, primarily relates to costs associated with international legal matters.

3

For the three months and twelve months ended December 31, 2021, $0.3 million and $2.9 million, respectively, associated with the Operating Group Reorganization and other continuing restructuring measures. For the three and twelve months ended December 31, 2020, severance charges are associated with the OneTEAM program, including international operations.

4

Amount represents the insurance deductible for hurricane damage incurred for the twelve months ended December 31, 2020

5

Represents the tax effect of the adjustments. Beginning in Q2 2021, we now use the statutory tax rate, net of valuation allowance by legal entity to determine the tax effect of the adjustments. Prior to Q2 2021, we used an assumed marginal tax rate of 21% except for the adjustment of the goodwill impairment charge in Q1 2020 for which the actual tax impact was used. We have restated the prior period tax impact to use the statutory tax rate by legal entity, net of valuation allowance.

6

Represents pension expense (credit) for the U.K. pension plan based on the difference between the expected return on plan assets and the cost of the discounted pension liability. The pension plan has had no new participants added since the plan was frozen in 1994 and accruals for future benefits ceased in connection with a plan curtailment in 2013.

7

Represents foreign currency loss. For prior periods, includes other nominal fees.

 

TEAM, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Continued)

(unaudited, in thousands)

         
   

Three Months Ended

December 31,

 

Twelve Months Ended

December 31,

   

2021

 

2020

 

2021

 

2020

                 

Segment Adjusted EBIT and Adjusted EBITDA:

               
                 

IHT

               

Operating income (loss)

 

$                2,173

 

$                5,052

 

$              12,997

 

$           (174,638)

Severance charges, net1

 

86

 

446

 

661

 

1,572

Natural disaster costs2

 

 

 

 

21

Goodwill impairment charge

 

 

 

 

191,788

Adjusted EBIT

 

2,259

 

5,498

 

13,658

 

18,743

Depreciation and amortization

 

3,071

 

3,553

 

12,959

 

14,891

Adjusted EBITDA

 

$                5,330

 

$                9,051

 

$              26,617

 

$              33,634

                 

MS

               

Operating income

 

$                3,071

 

$                5,377

 

$             (47,728)

 

$              25,879

Severance charges, net1

 

30

 

55

 

524

 

3,048

Natural disaster costs2

 

 

 

 

479

Goodwill impairment loss

 

 

 

55,837

 

Adjusted EBIT

 

3,101

 

5,432

 

8,633

 

29,406

Depreciation and amortization

 

5,068

 

5,457

 

20,500

 

21,854

Adjusted EBITDA

 

$                8,169

 

$              10,889

 

$              29,133

 

$              51,260

                 

Quest Integrity

               

Operating income

 

$               (6,252)

 

$                6,673

 

$                   900

 

$              16,474

Severance charges, net1

 

83

 

191

 

357

 

517

Goodwill impairment loss

 

8,795

 

 

8,795

 

Adjusted EBIT

 

2,626

 

6,864

 

10,052

 

16,991

Depreciation and amortization

 

600

 

845

 

2,616

 

3,587

Adjusted EBITDA

 

$                3,226

 

$                7,709

 

$              12,668

 

$              20,578

                 

Corporate and shared support services

               

Net loss

 

$             (44,636)

 

$             (31,977)

 

$           (154,779)

 

$           (104,918)

Provision (benefit) for income taxes

 

1,785

 

1,097

 

11,209

 

(14,715)

Interest expense, net

 

17,340

 

7,971

 

46,308

 

29,818

Loss on debt extinguishment and modification

 

 

2,224

 

 

2,224

Foreign currency loss6

 

1,400

 

1,117

 

5,674

 

2,758

Pension expense (credit)3

 

(102)

 

137

 

(622)

 

(244)

Loss on warrants

 

59

 

 

59

 

Professional fees and other4

 

5,775

 

1,076

 

8,882

 

5,062

Legal costs5

 

398

 

21

 

7,243

 

1,947

Severance charges, net1

 

103

 

184

 

1,564

 

740

Adjusted EBIT

 

(17,878)

 

(18,150)

 

(74,462)

 

(77,328)

Depreciation and amortization

 

1,363

 

1,344

 

5,443

 

5,576

Non-cash share-based compensation costs

 

1,437

 

2,234

 

7,013

 

6,307

Adjusted EBITDA

 

$             (15,078)

 

$             (14,572)

 

$             (62,006)

 

$             (65,445)

 

___________________

1

Primarily relates to severance charges incurred associated with the Operating Group Reorganization and other continuing restructuring measures for the three and twelve months ended December 31, 2021. For the three and twelve months ended December 31, 2020, relates to severance charges associated with the OneTEAM program, including international restructuring under the OneTEAM program.

2

Amount represents the insurance deductible for hurricane damage incurred for the twelve months ended December 31, 2020.

3

Represents pension expense (credit) for the U.K. pension plan based on the difference between the expected return on plan assets and the cost of the discounted pension liability. The pension plan has had no new participants added since the plan was frozen in 1994 and accruals for future benefits ceased in connection with a plan curtailment in 2013.

4

For the three and twelve months ended December 31, 2021, includes $0.2 million and $1.9 million, respectively, of costs associated with the Operating Group Reorganization (exclusive of restructuring costs). There were also $3.9 million related to costs associated with debt financing, $2.8 million of corporate support costs, and $0.3 million associated with the OneTEAM program (exclusive of restructuring costs). For the three and twelve months ended December 31, 2020, includes $0.6 million and $3.2 million, respectively, associated with the OneTEAM program (exclusive of restructuring costs).

5

For the three and twelve months ended December 31, 2021, primarily relates to accrued legal matters and other legal fees. For the three and twelve months ended December 31, 2020, primarily relates to costs associated with international legal matters.

6

Represents foreign currency loss. For prior periods, includes other nominal fees.

 

Cision View original content:https://www.prnewswire.com/news-releases/team-inc-reports-fourth-quarter-and-full-year-2021-results-301504594.html

SOURCE Team, Inc.

Investors

Data Provided by Refinitiv. Minimum 15 minutes delayed.

Investor Relations Contact

Christopher Robinson, CFA, Vice President, Corporate Development and Investor Relations, Phone (281) 388-5551
TEAM, Inc., 13131 Dairy Ashford, Suite 600, Sugar Land, TX 77478, United States Of America