HOUSTON, April 21, 2015 /PRNewswire/ -- Flotek
Industries, Inc. (NYSE: FTK - News) this morning, in
conjunction with its presentation at the Independent Petroleum
Association of America, announced preliminary, select financial
results for the quarter ended March 31,
2015.
First Quarter Preliminary, Select Financial Results
While still finalizing financial results for the quarter ended
March 31, 2015, Flotek believes that
revenue in the first quarter will exceed $82
million.
"The rapid deceleration in commodity prices and resulting
evisceration in oilfield activity had a marked impact on Flotek's
results in the first quarter," said John
Chisholm, Chairman, President and Chief Executive Officer of
Flotek. "As we noted at our February analyst meeting, we expect the
first half of 2015 to be sloppy and the first quarter didn't
disappoint in that regard. The decline in revenue approximated the
decline in overall oilfield activity which was much more pronounced
than nearly anyone would have expected. That said, we have
been through industry cycles before and are well positioned to
weather the tumult of the trough and emerge as a leader in oilfield
technology, with a solid balance sheet and financial position to
take advantage of opportunities as the industry emerges from the
depths of the current cycle."
Flotek anticipates enterprise-wide gross margins should exceed
32% in the first quarter, largely a result of a weaker pricing
environment. The Company is actively working with suppliers to
reduce input costs and believes cost reductions will partially
offset margin erosion in the coming quarter.
For the three months ended March 31,
2015, Flotek expects to report a net loss of approximately
$1.5 million or $.03 per share on a fully diluted basis. A
portion of the loss is the result of one-time items that will be
discussed in more detail in the Company's upcoming quarterly report
and conference call.
Flotek expects first quarter Earnings Before Interest Taxes
Depreciation and Amortization, or EBITDA, a non-GAAP measure of
financial performance, is expected to be over $3 million.
In the first quarter, Flotek generated over $6 million in cash flow from operations, net of a
$5 million payment of 2014 employee
incentive awards and $4 million in
seasonal inventory build within the Consumer and Industrial
Chemistry Technologies segment. Adjusting for these items, the
Company generated over $1 million per
week during the first quarter, consistent with its historical cash
generation profile.
Operating cash flows and proceeds from routine asset sales were
utilized to fund capital expenditures of just under $6 million and the acquisition of essentially all
of the assets or International Hydralift LLC. Capital
expenditures were largely focused on completion of projects
initiated in 2014.
During the quarter Flotek repurchased 180,190 shares of its
common stock at an average price of $14.71 per share for an aggregate total of
approximately $2.7 million. The
repurchase was made pursuant to a $25
million share repurchase program authorized by the Company's
Board of Directors in November, 2012.
Cash balances increased by over $1
million during the first quarter of 2015.
Despite the deteriorating economic conditions, the Company's
receivable days sales outstanding remained within historical ranges
at 61 days. Flotek continues to keep a close eye on customer
payment habits, particularly among smaller North American
customers; however during the first quarter the Company did not
experience any significant deterioration in customer payment
habits.
"While we aren't satisfied with our performance in the first
quarter, we believe Flotek remains positioned to take advantage of
opportunities along the cyclical continuum," concluded Chisholm.
"While we can't control the timing or magnitude of cyclical
challenges, we can be nimble enough to adjust and remain
opportunistic, focus on our core business and make certain our cash
generation and balance sheet remain key priorities. By doing so, we
ensure the best possible outcome in a challenging environment."
"On the chemistry front, we continue to see new validation
opportunities and are working with over 40 companies in various
stages of validation projects in North
America," added Chisholm. "While activity and pricing has
moderated for all products, we have been pleased by the continued
strength in chemistry inquiries and validation projects."
Flotek will present at the Independent Petroleum Association of
America New York Oil and Gas Investment Symposium at 11:40am EDT today. The Company intends to release
its first quarter earnings report on Wednesday, April 22, 2015, after the market close
and host a conference call at 8:00am
EDT on Thursday, April 23,
2015.
About Flotek Industries, Inc.
Flotek is a global developer and distributor of a portfolio of
innovative oilfield technologies, including specialty chemicals and
down-hole drilling and production equipment. It serves major and
independent companies in the domestic and international oilfield
service industry. Flotek Industries, Inc. is a publicly traded
company headquartered in Houston,
Texas, and its common shares are traded on the New York
Stock Exchange under the ticker symbol "FTK."
For additional information, please visit Flotek's web site at
www.flotekind.com.
Forward-Looking Statements
Certain statements set forth in this Press Release constitute
forward-looking statements (within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934) regarding Flotek Industries, Inc.'s business,
financial condition, results of operations and prospects. Words
such as expects, anticipates, intends, plans, believes, seeks,
estimates and similar expressions or variations of such words are
intended to identify forward-looking statements, but are not the
exclusive means of identifying forward-looking statements in this
Press Release.
Although forward-looking statements in this Press Release
reflect the good faith judgment of management, such statements can
only be based on facts and factors currently known to management.
Consequently, forward-looking statements are inherently subject to
risks and uncertainties, and actual results and outcomes may differ
materially from the results and outcomes discussed in the
forward-looking statements. Factors that could cause or contribute
to such differences in results and outcomes include, but are not
limited to, demand for oil and natural gas drilling services in the
areas and markets in which the Company operates, competition,
obsolescence of products and services, the Company's ability to
obtain financing to support its operations, environmental and other
casualty risks, and the impact of government regulation.
Further information about the risks and uncertainties that may
impact the Company are set forth in the Company's most recent
filings on Form 10-K (including without limitation in the "Risk
Factors" Section), and in the Company's other SEC filings and
publicly available documents. Readers are urged not to place undue
reliance on these forward-looking statements, which speak only as
of the date of this Press Release. The Company undertakes no
obligation to revise or update any forward-looking statements in
order to reflect any event or circumstance that may arise after the
date of this Press Release.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/flotek-industries-announces-select-preliminary-first-quarter-financial-results-300069132.html
SOURCE Flotek Industries, Inc.