HOUSTON, Feb. 21, 2022 /PRNewswire/ -- NexTier Oilfield
Solutions Inc. (NYSE: NEX) ("NexTier" or the "Company") today
reported fourth quarter and full year 2021 financial and
operational results.
Full Year 2021 Results
- Reported total revenue of $1.4
billion for the year ended December
31, 2021
- Reported net loss of $119.4
million ($0.53 per diluted
share) for the year ended December 31,
2021
- Reported adjusted net loss(1) of $96.5 million ($0.43 per diluted share) for the year ended
December 31, 2021
- Reported adjusted EBITDA(1) of $114.0 million for the year ended December 31, 2021
Fourth Quarter 2021 Results & Recent Highlights
- Reported total revenue of $509.7
million in Q4 2021, reflecting an increase of 30% compared
to Q3 2021
- Reported positive net income of $10.9
million ($0.04 per diluted
share) in Q4 2021, compared to net loss of $44.0 million ($0.20 per diluted share) in the prior
quarter
- Adjusted net income of $19.8
million ($0.08 per diluted
share) in Q4 2021, compared to adjusted net loss of $24.3 million ($0.11 per diluted share) in the prior
quarter
- Reported adjusted EBITDA(1) of $80.2 million in Q4 2021, compared to
$27.8 million in Q3 2021. Q4 2021
reported adjusted EBITDA(1) includes a $21.2 million gain on the sale of assets
- Averaged 30 deployed and 29 fully-utilized fleets in Q4 2021
vs. 25 deployed and 24 fully-utilized fleets in Q3 2021
- Further reduced marketed hydraulic fracturing fleet by 0.2
million diesel-powered horsepower
- Exited Q4 2021 with 31 deployed fleets with 1 additional Tier
IV dual fuel fleet expected for late Q1 2022 deployment
- Ended Q4 2021 with total liquidity of $316.3 million, including $110.7 million of cash; no debt maturities until
2025
Management Commentary
"We are pleased with our solid fourth quarter results as we
continue to generate improved financial performance, illustrating
our strong position as the market strengthens," said Robert Drummond, President and Chief Executive
Officer of NexTier. "During the recent downturn, we took several
important steps, including the acquisition of Alamo Pressure
Pumping, to accelerate our strategy and solidify our position as a
leader in natural gas powered frac technology with a premium
position in the Permian Basin."
"As we look ahead to 2022, we expect the pace of market recovery
to remain positive and we are well-positioned to capitalize on
near-term cyclical recovery," Mr. Drummond continued. "Commodity
prices are giving our customers confidence to increase consumption
of our services in a market where the utilization of available frac
equipment is already high. It is important to note that capital
constraints, combined with lengthening lead times for new
equipment, limit the frac service providers' ability to respond
with additional supply. NexTier is uniquely positioned to benefit
from this constructive market environment, which we are confident
will result in differentiating returns on our counter-cyclical
investments in 2022 and beyond.
Mr. Drummond concluded, "I would like to thank our employees for
their relentless commitment to overcoming challenges and achieving
our objectives to move the Company forward. We look forward to
another year of supporting our customers, advancing our low-cost,
low-emissions strategy and delivering for stockholders in
2022."
"NexTier's revenue growth outpaced increasing market activity
for the third consecutive quarter, even before accounting for the
inclusion of a full quarter for Alamo versus one month in Q3," said
Kenny Pucheu, Executive Vice
President & Chief Financial Officer of NexTier. "Overall, our
Q4 profitability benefited from this increased size and scale, as
well as improvements from asset efficiency and utilization. We saw
modest benefit from pricing recovery in Q4, but we anticipate
improved pricing should be more impactful as we move through 2022.
Free cash flow generation is a top priority this year, and we
expect to see acceleration on this front, as well, as the year
progresses."
Full Year 2021 Financial Results
Revenue totaled $1.4 billion for
the year ended December 31, 2021,
compared to $1.2 billion for the year
ended December 31, 2020. Revenue
increase was primarily driven by an increased number of fleets
deployed and four months of Alamo
revenue. Net loss was $119.4 million,
or $0.53 per diluted share, for the
year ended December 31, 2021,
compared to net loss of $346.9
million, or $1.62 per diluted
share, for the year ended December
31, 2020.
Fourth Quarter 2021 Financial Results
Revenue totaled $509.7 million in
the fourth quarter of 2021, compared to $393.2 million in the third quarter of 2021.
The sequential improvement in revenue was driven by the inclusion
of Alamo for the full quarter
versus one month in the third quarter, as well as increased
activity in both our Completions and Well Construction and
Intervention Services segments.
Net income totaled $10.9 million,
or $0.04 per diluted share, in
the fourth quarter of 2021, compared to a net loss of $44.0 million, or $0.20 per diluted share in the third quarter of
2021. Adjusted net income(1) totaled $19.8 million, or $0.08 per diluted share, in the fourth quarter of
2021, compared to adjusted net loss of $24.3
million, or $0.11 per diluted
share, in the third quarter of 2021.
Selling, general and administrative expense ("SG&A") totaled
$35.1 million in the fourth quarter
of 2021, compared to SG&A of $37.5
million in the third quarter of 2021. Adjusted
SG&A(1) totaled $27.5
million in the fourth quarter of 2021, compared to adjusted
SG&A of $22.8 million in the
third quarter of 2021.
Adjusted EBITDA(1) totaled $80.2 million in the fourth quarter of 2021,
compared to adjusted EBITDA(1) of $27.8 million in the third quarter of 2021.
Fourth quarter 2021 reported adjusted EBITDA(1) includes
a $21.2 million gain on the sale of
assets.
Fourth Quarter 2021 Management Adjustments
EBITDA(1) for the fourth quarter was $71.3 million. When excluding net management
adjustments of $8.9 million,
adjusted EBITDA(1) for the fourth quarter was
$80.2 million. Management adjustments
included $7.2 million in stock
compensation expense, with other items netting to approximately
$1.7 million.
Completion Services
Revenue in our Completion Services segment totaled $481.0 million in the fourth quarter of 2021,
compared to $366.1 million in the
third quarter of 2021. Adjusted gross profit totaled $83.9 million in the fourth quarter of 2021,
compared to $46.2 million in the
third quarter of 2021.
During the fourth quarter the Company operated an average of 30
deployed fleets and 29 fully-utilized fleets, an increase from 25
and 24, respectively, in the third quarter. When taking only
fracturing and integrated wireline into account, revenue was
$461.1 million, while
annualized adjusted gross profit per fully-utilized fracturing
fleet(1) totaled $11.4 million in the fourth quarter of 2021,
compared to revenue and annualized adjusted gross profit per
fully-utilized fracturing fleet(1) of $339.3 million and $7.3 million in the third quarter of 2021,
respectively. The increase was primarily driven by improved
calendar efficiency combined with modest pricing recovery, compared
to the third quarter of 2021.
Also, during the fourth quarter, the Company further reduced its
fleet of marketed hydraulic fracturing equipment by 0.2 million of
diesel-powered horsepower, through the international sale and
continuation of the decommissioning program.
Well Construction and Intervention Services
Revenue in our Well Construction and Intervention ("WC&I")
Services segment, totaled $28.7
million in the fourth quarter of 2021, compared to
$27.1 million in the third quarter of
2021. The sequential improvement was primarily driven by increased
customer activity in both our Coil Tubing and Cement product lines.
Adjusted gross profit totaled $2.7
million in the fourth quarter of 2021, compared to adjusted
gross profit of $2.9 million in the
third quarter of 2021.
Balance Sheet and Capital
Total debt outstanding as of December 31,
2021 was $374.9 million,
net of debt discounts and deferred finance costs and excluding
finance lease obligations, and including an additional tranche
of $3.4 million on the equipment financing loan secured
during Q4 2021. As of December 31,
2021, total available liquidity was $316.3 million, comprised of cash of
$110.7 million, and $205.6 million of available borrowing
capacity under our asset-based credit facility, which remains
undrawn.
Total cash used in operating activities during the fourth
quarter of 2021 was $31.5 million and
cash used by investing activities was $7.4
million, excluding cash used in acquisition of business,
resulting in a free cash flow(1) use of $38.9 million in the fourth quarter of 2021.
Outlook
As our industry begins an upcycle driven by rapidly tightening
markets for oil and gas and several years of global
under-investment in energy production, the Company is well
positioned to provide differentiated value for customers and
investors during 2022. As customers are responding to strong
commodity prices and a constructive market backdrop for well
completion services, NexTier is focusing on identifying and
fortifying the right long-term partnerships for its premier fleet
of natural gas-powered equipment in 2022 and beyond.
For the first quarter of 2022, NexTier expects to operate an
average of 31 deployed frac fleets and intends to deploy one
additional upgraded Tier IV Dual Fuel frac fleet by the end of the
first quarter, exiting the quarter with 32 deployed frac
fleets.
While the market continues to signal an upcycle with momentum as
we enter 2022, our first quarter results are expected to see some
impact from post-holiday start-up disruptions, increased downtime
as a result of sand shortages, and weather-related delays.
Additionally, supply chain lead times delayed the deployment of our
32nd fleet until late Q1 versus our prior expectation for an early
Q1 deployment.
Based on the above deployed fleets and the recapture of pricing
concessions through Q1, we anticipate sequential revenue growth in
the low-to-mid teens on a percentage basis. Despite continued
supply chain challenges and inflationary pressures, we anticipate
exiting the first quarter with double-digit annualized adjusted
EBITDA per deployed frac fleet(1). We expect to exit the
first quarter with ongoing momentum as the market backdrop
continues to strengthen.
First half 2022 capital expenditures are expected to approximate
$90-100 million before stepping down
to a lower level in the second half. Our full year 2022
maintenance capital expenditures are expected to increase
year-over-year in support of activity gains and our commitment to
service quality. Still, we forecast total full year 2022 capital
expenditures will be lower than full year 2021.
We expect to generate free cash flow in excess of $100 million in 2022, accelerating through
year-end as capital expenditures and working capital headwinds
decline as the year progresses.
Mr. Pucheu noted, "The majority of our 2022 capex forecast is
directly tied to maintenance of our fleet as well as making
margin-accretive, quick-payback investments in our existing fleet
and our Power Solutions business."
Mr. Drummond concluded, "We expect the US land completions
market momentum to continue into the second quarter and throughout
2022. We are concluding the counter-cyclical investment portion of
our strategy just as the recovery accelerates, which we believe
positions us to achieve attractive returns and free cash flow
through the coming cycle. These investments provide NexTier
differential competitive advantages in fleet technology, digital
systems, and logistics optimization that will provide strong
returns today, throughout 2022 and in future years. We plan to be
disciplined with our free cash flow, with the expectation that we
can exit 2022 with net debt to adjusted EBITDA ratio below one
turn."
Investor Day 2022
NexTier scheduled a Virtual Investor Day for Thursday, March 3, 2022, from 9:00 am – 1:00 pm
CT. The day will provide an immersive experience
showcasing our key business leaders who will highlight advantages
of our integrated well completion services strategy including
reducing both costs and emissions at the wellsite. We believe our
strategy has and will continue to create significant value for
NexTier investors and customers. We are excited to share how this
strategy can positively impact NexTier's future earnings power. The
management presentations will be followed by a Question &
Answer session with the NexTier executive team. Investors are
encouraged to register for this event.
Request to register for Investor Day 2022 at:
https://events.bizzabo.com/385457.
Conference Call Information
On February 22, 2022, NexTier will
hold a conference call for investors at 9:00
a.m. Central Time (10:00 a.m. Eastern
Time) to discuss fourth quarter and full year 2021 financial
and operating results. Hosting the call will be management of
NexTier, including Robert Drummond,
President and Chief Executive Officer and Kenny Pucheu, Executive Vice President and Chief
Financial Officer. The call can be accessed via a live webcast
accessible on the IR Event Calendar page in the Investor Relations
section of our website at www.nextierofs.com or live over the
telephone by dialing (855) 560-2574, or for international callers,
(412) 542-4160. A replay will be available shortly after the call
and can be accessed by dialing (877) 344-7529, or for international
callers, (412) 317-0088. The passcode for the telephonic replay is
8748097 and will be available until March 2,
2022. An archive of the webcast will be available shortly
after the call on our website at www.nextierofs.com for twelve
months following the call.
About NexTier Oilfield Solutions
Headquartered in Houston,
Texas, NexTier is an industry-leading U.S. land oilfield
service company, with a diverse set of well completion and
production services across active and demanding basins. Our
integrated solutions approach delivers efficiency today, and our
ongoing commitment to innovation helps our customers better address
what is coming next. NexTier is differentiated through four points
of distinction, including safety performance, efficiency,
partnership and innovation. At NexTier, we believe in living
our core values from the basin to the boardroom, and helping
customers win by safely unlocking affordable, reliable and
plentiful sources of energy.
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(1)
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Non-GAAP Financial
Measures. The Company has included in this press release or
discussed on the conference call described above certain non-GAAP
financial measures, some of which are calculated on segment basis
or product line basis. These measurements provide supplemental
information which the Company believes is useful to analysts and
investors to evaluate its ongoing results of operations, when
considered alongside GAAP measures such as net income and operating
income.
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|
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Non-GAAP financial
measures include EBITDA, adjusted EBITDA, adjusted gross profit,
adjusted net income (loss), free cash flow, adjusted SG&A,
adjusted EBITDA per fleet deployed, annualized adjusted EBITDA per
fleet deployed, net debt, adjusted EBITDA margin, and annualized
adjusted gross profit per fully-utilized fracturing fleet. These
non-GAAP financial measures exclude the financial impact of items
management does not consider in assessing the Company's ongoing
operating performance, and thereby facilitate review of the
Company's operating performance on a period-to-period basis. Other
companies may have different capital structures, and comparability
to the Company's results of operations may be impacted by the
effects of acquisition accounting on its depreciation and
amortization. As a result of the effects of these factors and
factors specific to other companies, the Company believes EBITDA,
adjusted EBITDA, adjusted gross profit, adjusted EBITDA per fleet
deployed, adjusted SG&A, adjusted EBITDA margin, and adjusted
net income (loss) provide helpful information to analysts and
investors to facilitate a comparison of its operating performance
to that of other companies. The Company believes free cash flow is
important to investors in that it provides a useful measure to
assess management's effectiveness in the areas of profitability and
capital management. Annualized adjusted gross profit per
fully-utilized fracturing fleet is used to evaluate the operating
performance of the business line for comparable periods, and the
Company believes it is important as an indicator of operating
performance of our fracturing and integrated wireline product line
because it excludes the effects of the capital structure and
certain non-cash items from the product line's operating results.
For a reconciliation of these non-GAAP measures, please see the
tables at the end of this press release. Reconciliations of
forward-looking non-GAAP financial measures to comparable GAAP
measures are not available due to the challenges and
impracticability with estimating some of the items, particularly
with estimates for certain contingent liabilities, and estimating
non-cash unrealized fair value losses and gains which are subject
to market variability and therefore a reconciliation is not
available without unreasonable effort.
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Non-GAAP Measure
Definitions: EBITDA is defined as net income (loss) adjusted to
eliminate the impact of interest, income taxes, depreciation and
amortization. Adjusted EBITDA is defined as EBITDA as further
adjusted with certain items management does not consider in
assessing ongoing performance. Adjusted gross profit is defined as
revenue less cost of services, further adjusted to eliminate items
in cost of services that management does not consider in assessing
ongoing performance. Adjusted gross profit at the segment level is
not considered to be a non-GAAP financial measure as it is our
segment measure of profit or loss and is required to be disclosed
under GAAP pursuant to ASC 280. Adjusted net income (loss) is
defined as net income (loss) plus the after-tax amount of
merger/transaction-related costs and other non-routine items.
Adjusted SG&A is defined as selling, general and administrative
expenses adjusted for severance and business divestiture costs,
merger/transaction-related costs, and other non-routine items. Free
cash flow is defined as the net increase (decrease) in cash and
cash equivalents before financing activities, excluding any
acquisitions. Annualized adjusted gross profit per fully-utilized
fleet is defined as (i) revenue less cost of services attributable
to the fracturing and integrated wireline product line, further
adjusted to eliminate items in cost of services that management
does not consider in assessing ongoing performance for the
fracturing and integrated wireline product line, (ii) divided by
the fully-utilized fracturing and integrated wireline fleets
(average deployed fleets multiplied by fleet utilization) per
quarter, and then (iii) multiplied by four. Adjusted EBITDA per
fleet deployed is defined as (i) adjusted EBITDA, (ii) divided by
fleets deployed. Adjusted EBITDA margin is defined as (i) adjusted
EBITDA, (i) divided by revenue. Annualized adjusted EBITDA per
fleet deployed is defined as (i) adjusted EBITDA, (ii) divided by
number of fleets deployed, and then (iii) multiplied by four. Net
debt is defined as (i) total debt, net of unamortized debt discount
and debt issuance costs, (ii) subtracted by cash and cash
equivalents.
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Forward-Looking Statements and Where to Find Additional
Information
This press release and discussion in the conference call
described above contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Where a forward-looking statement expresses or implies an
expectation or belief as to future events or results, such
expectation or belief is expressed in good faith and believed to
have a reasonable basis. The words "believe," "continue," "could,"
"expect," "anticipate," "intends," "estimate," "forecast,"
"project," "should," "may," "will," "would," "plan," "target,"
"predict," "potential," "outlook," and "reflects," or the negative
thereof and similar expressions, are intended to identify such
forward-looking statements. These forward-looking statements are
only predictions and involve known and unknown risks and
uncertainties, many of which are beyond the Company's control.
Statements in this press release or made during the conference call
described above that are forward-looking, including projections as
to the Company's 2022 guidance and other outlook information
(including with respect to the industry in which the Company
conducts its business), are based on management's estimates,
assumptions and projections, and are subject to significant
uncertainties and other factors, many of which are beyond the
Company's control. These factors and risks include, but are not
limited to, (i) the competitive nature of the industry in which the
Company conducts its business, including pricing pressures; (ii)
the ability to meet rapid demand shifts; (iii) the impact of
pipeline capacity constraints and adverse weather conditions in oil
or gas producing regions; (iv) the ability to obtain or renew
customer contracts and changes in customer requirements in the
markets the Company serves; (v) the ability to identify, effect and
integrate acquisitions, joint ventures or other transactions; (vi)
the ability to protect and enforce intellectual property rights;
(vii) the effect of environmental and other governmental
regulations on the Company's operations; (viii) the effect of a
loss of, or interruption in operations of, the Company of one or
more key suppliers, or customers, including resulting from
inflation, COVID-19 resurgence, product defects, recalls or
suspensions; (ix) the variability of crude oil and natural gas
commodity prices; (x) the market price (including inflation) and
timely availability of materials or equipment; (xi) the ability to
obtain permits, approvals and authorizations from governmental and
third parties; (xii) the Company's ability to employ a sufficient
number of skilled and qualified workers; (xiii) the level of, and
obligations associated with, indebtedness; (xiv) fluctuations in
the market price of the Company's stock; (xv) the continued impact
of the COVID-19 pandemic (including as a result of the emergence of
new variants and strains of the virus, such as Delta and Omicron)
and the evolving response thereto by governments, private
businesses or others to contain the spread of the virus and its
variants or to treat its impact, and the possibility of increased
inflation, travel restrictions, lodging shortages or other
macro-economic challenges as the economy emerges from the COVID-19
pandemic; and (xvi) other risk factors and additional information.
In addition, material risks that could cause actual results to
differ from forward-looking statements include: the inherent
uncertainty associated with financial or other projections; the
effective integration of Alamo's
businesses and the ability to achieve the anticipated synergies and
value-creation contemplated by the proposed transaction;
unanticipated difficulties or expenditures relating to the
transaction, the response or retention of customers and vendors as
a result of the announcement and/or closing of the transaction; and
the diversion of management time on transaction-related issues. For
a more detailed discussion of such risks and other factors, see the
Company's filings with the Securities and Exchange Commission (the
"SEC"), including under the headings "Part I, Item 1A. Risk
Factors" and "Part II, Item 7. Management's Discussion and Analysis
of Financial Condition and Results of Operations" of the Company's
most recent Annual Report on Form 10-K, available on the SEC
website or www.NexTierOFS.com. The Company assumes no obligation to
update any forward-looking statements or information, which speak
as of their respective dates, to reflect events or circumstances
after the date hereof, or to reflect the occurrence of
unanticipated events, except as may be required under applicable
securities laws. Investors should not assume that any lack of
update to a previously issued "forward-looking statement"
constitutes a reaffirmation of that statement.
Additional information about the Company, including information
on the Company's response to Covid-19, can be found in its periodic
reports that are filed with the SEC, available www.sec.gov or
www.NexTierOFS.com.
Investor Contact:
Kenneth Pucheu
Executive Vice President - Chief Financial Officer
Michael Sabella
Vice President - Investor Relations and Business Development
michael.sabella@nextierofs.com
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NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(unaudited, amounts
in thousands, except per share data)
|
|
|
Three Months
Ended
|
|
December 31,
2021
|
|
September 30,
2021
|
|
June 30,
2021
|
|
March 31,
2021
|
|
|
|
|
|
|
|
|
|
Revenue
|
$
509,730
|
|
$
393,164
|
|
$
292,145
|
|
$
228,402
|
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
|
Cost of
services
|
423,647
|
|
344,637
|
|
269,260
|
|
217,777
|
|
Depreciation and
amortization
|
52,764
|
|
44,861
|
|
40,671
|
|
45,868
|
|
Selling, general and
administrative expenses
|
35,148
|
|
37,453
|
|
20,734
|
|
16,069
|
|
Merger and
integration
|
3,779
|
|
4,752
|
|
178
|
|
—
|
|
Gain on disposal of
assets
|
(21,156)
|
|
(1,133)
|
|
(2,017)
|
|
(4,592)
|
|
Total operating costs
and expenses
|
494,182
|
|
430,570
|
|
328,826
|
|
275,122
|
|
Operating income
(loss)
|
15,548
|
|
(37,406)
|
|
(36,681)
|
|
(46,720)
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
Other income
(expense), net
|
3,018
|
|
585
|
|
11,247
|
|
(2,719)
|
|
Interest expense,
net
|
(7,976)
|
|
(6,701)
|
|
(5,726)
|
|
(4,206)
|
|
Total other income
(expense)
|
(4,958)
|
|
(6,116)
|
|
5,521
|
|
(6,925)
|
|
Income (loss) before
income taxes
|
10,590
|
|
(43,522)
|
|
(31,160)
|
|
(53,645)
|
|
Income tax benefit
(expense)
|
264
|
|
(472)
|
|
(621)
|
|
(857)
|
|
Net income
(loss)
|
$
10,854
|
|
$
(43,994)
|
|
$
(31,781)
|
|
(54,502)
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share: basic
|
$
0.04
|
|
$
(0.20)
|
|
$
(0.15)
|
|
$
(0.25)
|
|
Net income (loss) per
share: diluted
|
$
0.04
|
|
$
(0.20)
|
|
$
(0.15)
|
|
$
(0.25)
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares: basic
|
241,913
|
|
224,481
|
|
215,443
|
|
215,110
|
|
Weighted-average
shares: diluted
|
244,744
|
|
224,481
|
|
215,443
|
|
215,110
|
|
NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(unaudited, amounts
in thousands, except per share data)
|
|
|
Year
Ended
|
|
December 31,
2021
|
|
December 31,
2020
|
|
|
|
|
|
Revenue
|
$
1,423,441
|
|
$
1,202,581
|
|
Operating costs and
expenses:
|
|
|
|
|
Cost of
services
|
1,255,321
|
|
1,032,574
|
|
Depreciation and
amortization
|
184,164
|
|
302,051
|
|
Selling, general and
administrative expenses
|
109,404
|
|
144,147
|
|
Merger and
integration
|
8,709
|
|
32,539
|
|
Gain on disposal of
assets
|
(28,898)
|
|
(14,461)
|
|
Impairment
expense
|
—
|
|
37,008
|
|
Total operating costs
and expenses
|
1,528,700
|
|
1,533,858
|
|
Operating
loss
|
(105,259)
|
|
(331,277)
|
|
Other
expense:
|
|
|
|
|
Other income,
net
|
12,131
|
|
6,516
|
|
Interest expense,
net
|
(24,609)
|
|
(20,652)
|
|
Total other
expense
|
(12,478)
|
|
(14,136)
|
|
Loss before income
taxes
|
(117,737)
|
|
(345,413)
|
|
Income tax
expense
|
(1,686)
|
|
(1,470)
|
|
Net
loss
|
(119,423)
|
|
(346,883)
|
|
Other comprehensive
loss:
|
|
|
|
|
Foreign currency
translation adjustments
|
407
|
|
(241)
|
|
Hedging
activities
|
1,703
|
|
(6,422)
|
|
Total
comprehensive loss
|
$
(117,313)
|
|
$
(353,546)
|
|
|
|
|
|
Net loss per share:
basic
|
$
(0.53)
|
|
$
(1.62)
|
|
Net loss per share:
diluted
|
$
(0.53)
|
|
$
(1.62)
|
|
|
|
|
|
Weighted-average
shares: basic
|
224,401
|
|
213,795
|
|
Weighted-average
shares: diluted
|
224,401
|
|
213,795
|
|
NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
(unaudited, amounts
in thousands)
|
|
|
|
December
31,
|
|
December
31,
|
|
|
2021
|
|
2020
|
|
ASSETS
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
110,695
|
|
$
275,990
|
|
Trade and other
accounts receivable, net
|
|
301,740
|
|
122,584
|
|
Inventories,
net
|
|
38,094
|
|
30,068
|
|
Assets held for
sale
|
|
1,555
|
|
126
|
|
Prepaid and other
current assets
|
|
55,625
|
|
58,011
|
|
Total current
assets
|
|
507,709
|
|
486,779
|
|
Operating lease
right-of-use assets
|
|
21,767
|
|
37,157
|
|
Finance lease
right-of-use assets
|
|
41,537
|
|
1,132
|
|
Property and equipment,
net
|
|
620,865
|
|
470,711
|
|
Goodwill
|
|
192,780
|
|
104,198
|
|
Intangible
assets
|
|
64,961
|
|
51,182
|
|
Other noncurrent
assets
|
|
7,962
|
|
6,729
|
|
Total
assets
|
|
$
1,457,581
|
|
$
1,157,888
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Accounts
payable
|
|
$
190,963
|
|
$
61,259
|
|
Accrued
expenses
|
|
213,923
|
|
134,230
|
|
Customer contract
liabilities
|
|
23,729
|
|
266
|
|
Current maturities of
operating lease liabilities
|
|
7,452
|
|
18,551
|
|
Current maturities of
finance lease liabilities
|
|
11,906
|
|
606
|
|
Current maturities of
long-term debt
|
|
13,384
|
|
2,252
|
|
Other current
liabilities
|
|
10,346
|
|
2,993
|
|
Total current
liabilities
|
|
471,703
|
|
220,157
|
|
Long-term operating
lease liabilities, less current maturities
|
|
20,446
|
|
24,232
|
|
Long-term finance lease
liabilities, less current maturities
|
|
26,873
|
|
504
|
|
Long-term debt, net of
unamortized deferred financing costs and unamortized debt discount,
less current maturities
|
|
361,501
|
|
333,288
|
|
Other non-current
liabilities
|
|
30,041
|
|
22,419
|
|
Total non-current
liabilities
|
|
438,861
|
|
380,443
|
|
Total
liabilities
|
|
910,564
|
|
600,600
|
|
Stockholders'
equity:
|
|
|
|
|
|
Common
stock
|
|
2,420
|
|
2,144
|
|
Paid-in capital in
excess of par value
|
|
1,094,020
|
|
989,995
|
|
Retained
deficit
|
|
(541,164)
|
|
(421,741)
|
|
Accumulated other
comprehensive loss
|
|
(8,259)
|
|
(13,110)
|
|
Total stockholders'
equity
|
|
547,017
|
|
557,288
|
|
Total liabilities
and stockholders' equity
|
|
$
1,457,581
|
|
$
1,157,888
|
|
NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
ADDITIONAL
SELECTED FINANCIAL AND OPERATING DATA
|
|
(unaudited, amounts
in thousands)
|
|
|
Three Months
Ended
|
|
December 31,
2021
|
|
September 30,
2021
|
|
Completion
Services:
|
|
|
|
|
Revenue
|
$
481,001
|
|
$
366,067
|
|
Cost of
services
|
397,319
|
|
320,297
|
|
Depreciation,
amortization, (gain) loss on sale of assets, and
impairment
|
23,912
|
|
37,593
|
|
Net income
|
59,770
|
|
8,177
|
|
Adjusted gross
profit(1)
|
$
83,908
|
|
$
46,184
|
|
|
|
|
|
Well Construction
and Intervention Services:
|
|
|
|
|
Revenue
|
$
28,729
|
|
$
27,097
|
|
Cost of
services
|
26,328
|
|
24,340
|
|
Depreciation,
amortization, (gain) loss on sale of assets, and
impairment
|
3,334
|
|
2,034
|
|
Net income
(loss)
|
(933)
|
|
723
|
|
Adjusted gross
profit(1)
|
$
2,679
|
|
$
2,905
|
|
|
|
(1)
|
The Company uses
adjusted gross profit(1) as its measure of profitability
for segment reporting.
|
|
NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
NON-GAAP FINANCIAL
MEASURES
|
|
(unaudited, amounts
in thousands)
|
|
|
|
Three Months
Ended
|
|
|
December 31,
2021
|
|
September 30,
2021
|
|
June 30,
2021
|
|
March 30,
2021
|
|
Net income
(loss)
|
|
$
10,854
|
|
$
(43,994)
|
|
$
(31,781)
|
|
$
(54,502)
|
|
Interest expense,
net
|
|
7,976
|
|
6,701
|
|
5,726
|
|
4,206
|
|
Income tax
expense
|
|
(264)
|
|
472
|
|
621
|
|
857
|
|
Depreciation and
amortization
|
|
52,764
|
|
44,861
|
|
40,671
|
|
45,868
|
|
EBITDA
|
|
$
71,330
|
|
$
8,040
|
|
$
15,237
|
|
$
(3,571)
|
|
Plus management
adjustments:
|
|
|
|
|
|
|
|
|
|
Acquisition,
integration and expansion(1)
|
|
3,779
|
|
4,752
|
|
178
|
|
—
|
|
Non-cash stock
compensation(2)
|
|
7,235
|
|
7,350
|
|
4,889
|
|
5,203
|
|
Market-driven
costs(3)
|
|
504
|
|
578
|
|
378
|
|
7,295
|
|
Divestiture of
business(4)
|
|
279
|
|
5,927
|
|
2,428
|
|
(785)
|
|
(Gain) loss on
equity security investment(5)
|
|
(3,041)
|
|
522
|
|
(1,331)
|
|
3,693
|
|
Litigation(6)
|
|
100
|
|
4,000
|
|
1,638
|
|
2,137
|
|
Tax
audit(7)
|
|
—
|
|
(2,771)
|
|
(8,778)
|
|
(13,328)
|
|
Insurance
recovery(8)
|
|
—
|
|
(723)
|
|
(9,686)
|
|
—
|
|
Other
|
|
44
|
|
88
|
|
347
|
|
25
|
|
Adjusted
EBITDA
|
|
$
80,230
|
|
$
27,763
|
|
$
5,300
|
|
$
669
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Represents
transaction and integration costs related to
acquisitions.
|
|
(2)
|
Represents non-cash
amortization of equity awards issued under the Company's Incentive
Award Plan.
|
|
(3)
|
Represents
market-driven severance, leased facility closures, and
restructuring costs incurred as a result of significant declines in
crude oil prices resulting from demand destruction from the
COVID-19 pandemic and global oversupply.
|
|
(4)
|
Represents the gain
on final cash settlement of the Basic Notes received as part of the
sale of Well Support Services in the first quarter of 2021, bad
debt expense and contingent liability recognized in the second,
third, and fourth quarters of 2021 on the sale of the Well Support
Services segment to, and related to the bankruptcy filing of Basic
Energy Services.
|
|
(5)
|
Represents the
realized and unrealized (gain) loss on an equity security
investment composed primarily of common equity shares in a public
company.
|
|
(6)
|
Represents increases
in accruals related to contingencies acquired in business
acquisitions or exceptional material events.
|
|
(7)
|
Represents a
reduction of the Company's accrual related to a tax audits acquired
in business acquisitions.
|
|
(8)
|
Represents a gain on
insurance recovery in excess of book value due to a fire
incident.
|
|
NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
NON-GAAP FINANCIAL
MEASURES
|
|
(unaudited, amounts
in thousands)
|
|
|
Year
Ended
|
|
December 31,
2021
|
|
Net
loss
|
(119,423)
|
|
Interest expense,
net
|
24,609
|
|
Income tax
expense
|
1,686
|
|
Depreciation and
amortization
|
184,164
|
|
EBITDA
|
91,036
|
|
Plus management
adjustments:
|
|
|
Acquisition,
integration and expansion(1)
|
8,709
|
|
Non-cash stock
compensation(2)
|
24,677
|
|
Market-driven
costs(3)
|
8,755
|
|
Divestiture of
business(4)
|
7,849
|
|
Gain on equity
security investment(5)
|
(157)
|
|
Litigation(6)
|
7,875
|
|
Tax
audit(7)
|
(24,877)
|
|
Insurance
recovery(8)
|
(10,409)
|
|
Other
|
504
|
|
Adjusted
EBITDA
|
113,962
|
|
|
|
(1)
|
Represents
transaction and integration costs related to
acquisitions.
|
|
(2)
|
Represents non-cash
amortization of equity awards issued under the Company's Incentive
Award Plan.
|
|
(3)
|
Represents
market-driven severance, leased facility closures, and
restructuring costs incurred as a result of significant declines in
crude oil prices resulting from demand destruction from the
COVID-19 pandemic and global oversupply.
|
|
(4)
|
Represents the gain
on final cash settlement of the Basic Notes received as part of the
sale of Well Support Services in the first quarter of 2021, bad
debt expense and contingent liability recognized in the second,
third, and fourth quarters of 2021 on the sale of the Well Support
Services segment to, and related to the bankruptcy filing of Basic
Energy Services.
|
|
(5)
|
Represents the
realized and unrealized (gain) loss on an equity security
investment composed primarily of common equity shares in a public
company.
|
|
(6)
|
Represents increases
in accruals related to contingencies acquired in business
acquisitions or exceptional material events.
|
|
(7)
|
Represents a
reduction of the Company's accrual related to a tax audits acquired
in business acquisitions.
|
|
(8)
|
Represents a gain on
insurance recovery in excess of book value due to a fire
incident.
|
|
NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
NON-GAAP FINANCIAL
MEASURES
|
|
(unaudited, amounts
in thousands)
|
|
|
Year
Ended
|
|
December 31,
2020
|
|
Net
loss
|
(346,883)
|
|
Interest expense,
net
|
20,652
|
|
Income tax
expense
|
1,470
|
|
Depreciation and
amortization
|
302,051
|
|
EBITDA
|
(22,710)
|
|
Plus management
adjustments:
|
|
|
Acquisition,
integration and expansion(1)
|
33,116
|
|
Non-cash stock
compensation(2)
|
20,015
|
|
Impairment of
assets (3)
|
37,008
|
|
Market-driven
costs(4)
|
28,308
|
|
Divestiture of
business(5)
|
(8,589)
|
|
Gain on equity
security investment(6)
|
(6,000)
|
|
Other
|
(2,172)
|
|
Adjusted
EBITDA
|
78,976
|
|
|
|
(1)
|
Represents
transaction and integration costs related to
acquisitions.
|
|
(2)
|
Represents non-cash
amortization of equity awards issued under the Company's Incentive
Award Plan, excluding accelerations associated with market-driven
costs or acquisitions, integration, and expansion costs.
|
|
(3)
|
Represents goodwill
impairment and write-down of inventory carrying value down to its
net realizable value.
|
|
(4)
|
Represents
market-driven severance, leased facility closures, and
restructuring costs incurred as a result of significant declines in
crude oil prices resulting from demand destruction from the
COVID-19 pandemic and global oversupply.
|
|
(5)
|
Represents net gain
on the sale of Well Support Services segment and increase in fair
value of the Basic notes and make-whole derivative received as part
of the sale.
|
|
(6)
|
Represents the
realized and unrealized gain on an equity security investment
composed primarily of common equity shares in a public
company.
|
|
NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
NON-GAAP FINANCIAL
MEASURES
|
|
(unaudited, amounts
in thousands)
|
|
|
|
Three Months
Ended
December 31, 2021
|
|
Selling, general
and administrative expenses
|
|
$
35,148
|
|
Less management
adjustments:
|
|
|
|
Non-cash stock
compensation
|
|
(7,235)
|
|
Litigation
|
|
(100)
|
|
Divestiture of
business
|
|
(279)
|
|
Other
|
|
(44)
|
|
Adjusted selling,
general and administrative expenses
|
|
$
27,490
|
|
|
|
Three Months
Ended
September 30, 2021
|
|
Selling, general
and administrative expenses
|
|
$
37,453
|
|
Less management
adjustments:
|
|
|
|
Non-cash stock
compensation
|
|
(7,350)
|
|
Market-driven
costs
|
|
(16)
|
|
Litigation
|
|
(4,000)
|
|
Tax
audit
|
|
2,771
|
|
Divestiture of
business
|
|
(5,927)
|
|
Other
|
|
(88)
|
|
Adjusted selling,
general and administrative expenses
|
|
$
22,843
|
|
NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
NON-GAAP FINANCIAL
MEASURES
|
|
(unaudited, amounts
in thousands)
|
|
|
Three Months Ended
December 31, 2021
|
|
Completion
Services
|
|
WC&I
|
|
Total
|
|
Revenue
|
$
481,001
|
|
$
28,729
|
|
$
509,730
|
|
Cost of
services
|
397,319
|
|
26,328
|
|
423,647
|
|
Gross profit
excluding depreciation and amortization
|
83,682
|
|
2,401
|
|
86,083
|
|
Management
adjustments associated with cost of services
|
226
|
|
278
|
|
504
|
|
Adjusted gross
profit
|
$
83,908
|
|
$
2,679
|
|
$
86,587
|
|
|
Three Months Ended
September 30, 2021
|
|
Completion
Services
|
|
WC&I
|
|
Total
|
|
Revenue
|
$
366,067
|
|
$
27,097
|
|
$
393,164
|
|
Cost of
services
|
320,297
|
|
24,340
|
|
344,637
|
|
Gross profit
excluding depreciation and amortization
|
45,770
|
|
2,757
|
|
48,527
|
|
Management
adjustments associated with cost of services
|
414
|
|
148
|
|
562
|
|
Adjusted gross
profit
|
$
46,184
|
|
$
2,905
|
|
$
49,089
|
|
|
Three Months
Ended
|
|
|
December 31,
2021
|
|
|
Frac &
Integrated Wireline
|
|
Revenue
|
|
$
461,068
|
|
Cost of
services
|
|
378,769
|
|
Gross profit
excluding depreciation and amortization
|
|
82,299
|
|
Management
adjustments associated with cost of services
|
|
226
|
|
Adjusted gross
profit
|
|
$
82,525
|
|
|
|
|
Average hydraulic
fracturing fleets deployed
|
|
30
|
|
Fully-utilized
hydraulic fracturing fleets
|
|
29
|
|
Annualized adjusted
gross profit per fully-utilized fleet
|
|
$
11,383
|
|
|
|
Three Months
Ended
|
|
|
September 30,
2021
|
|
|
Frac &
Integrated Wireline
|
|
Revenue
|
|
$
339,305
|
|
Cost of
services
|
|
295,971
|
|
Gross profit
excluding depreciation and amortization
|
|
43,334
|
|
Management
adjustments associated with cost of services
|
|
382
|
|
Adjusted gross
profit
|
|
$
43,716
|
|
|
|
|
Average hydraulic
fracturing fleets deployed
|
|
25
|
|
Fully-utilized
hydraulic fracturing fleets
|
|
24
|
|
Annualized adjusted
gross profit per fully-utilized fleet
|
|
$
7,286
|
|
NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
NON-GAAP FINANCIAL
MEASURES
|
|
(unaudited, amounts
in thousands, except per share data)
|
|
|
|
Three Months
Ended
|
|
|
|
|
December 31,
2021
|
|
Net cash used in
operating activities
|
|
$
(31,467)
|
|
Net cash used in
investing activities(1)
|
|
(7,384)
|
|
Free cash
flow
|
|
$
(38,851)
|
|
|
(1) Excludes $0.7 million from the Alamo
acquisition.
|
|
|
Three Months
Ended
|
|
|
|
|
September 30,
2021
|
|
Net cash used by
operating activities
|
|
$
(10,721)
|
|
Net cash used in
investing activities(2)
|
|
(42,470)
|
|
Free cash
flow
|
|
$
(53,191)
|
|
|
(2) Excludes $99.3 million from the Alamo
acquisition.
|
|
|
|
Three Months
Ended
|
|
|
December 31,
2021
|
|
Net
income
|
|
$
10,854
|
|
Plus management
adjustments:
|
|
|
|
Acquisition,
integration and expansion
|
|
3,779
|
|
Non-cash stock
compensation
|
|
7,235
|
|
Market-driven
costs
|
|
504
|
|
Divestiture of
business
|
|
279
|
|
(Gain) loss on equity
security investment
|
|
(3,041)
|
|
Litigation
|
|
100
|
|
Other
|
|
44
|
|
Adjusted net
income
|
|
$
19,754
|
|
|
|
|
Adjusted net income
per share, basic
|
|
$
0.08
|
|
Adjusted net income
per share, diluted
|
|
$
0.08
|
|
|
|
|
Weighted-average
shares, basic
|
|
241,913
|
|
Weighted-average
shares, diluted
|
|
244,744
|
|
NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
NON-GAAP FINANCIAL
MEASURES
|
|
(unaudited, amounts
in thousands, except per share data)
|
|
|
Three Months
Ended
|
|
September 30,
2021
|
|
Net
loss
|
$
(43,994)
|
|
Plus management
adjustments:
|
|
|
Acquisition,
integration and expansion
|
4,752
|
|
Non-cash stock
compensation
|
7,350
|
|
Market-driven
costs
|
578
|
|
Divestiture of
business
|
5,927
|
|
Gain (loss) on equity
security investment
|
522
|
|
Litigation
|
4,000
|
|
Tax audit
|
(2,771)
|
|
Insurance
recovery
|
(723)
|
|
Other
|
88
|
|
Adjusted net
loss
|
$
(24,271)
|
|
|
|
Adjusted net loss per
share, basic and diluted
|
$
(0.11)
|
|
|
|
Weighted-average
shares, basic and diluted
|
224,481
|
|
|
Year
Ended
|
|
December 31,
2021
|
|
Net
loss
|
(119,423)
|
|
Plus management
adjustments:
|
|
|
Acquisition,
integration and expansion
|
8,709
|
|
Non-cash stock
compensation
|
24,677
|
|
Market-driven
costs
|
8,755
|
|
Divestiture of
business
|
7,849
|
|
(Gain) loss on equity
security investment
|
(157)
|
|
Litigation
|
7,875
|
|
Tax audit
|
(24,877)
|
|
Insurance
recovery
|
(10,409)
|
|
Other
|
504
|
|
Adjusted net
loss
|
$
(96,497)
|
|
|
|
Adjusted net loss per
share, basic and diluted
|
$
(0.43)
|
|
|
|
Weighted-average
shares, basic and diluted
|
224,401
|
|
NEXTIER OILFIELD
SOLUTIONS INC. AND SUBSIDIARIES
|
|
NON-GAAP FINANCIAL
MEASURES
|
|
(unaudited, amounts
in thousands)
|
|
|
|
December 31,
2021
|
|
Total debt, net of
unamortized debt discount and debt issuance costs
|
|
$
374,885
|
|
Cash and cash
equivalents
|
|
110,695
|
|
Net
debt
|
|
$
264,190
|
|
|
|
September 30,
2021
|
|
Total debt, net of
unamortized debt discount and debt issuance costs
|
|
$
373,022
|
|
Cash and cash
equivalents
|
|
135,525
|
|
Net
debt
|
|
$
237,497
|
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SOURCE NexTier Oilfield Solutions