Q2 2024 Tetra Technologies Inc Earnings Call Transcript
Key Points
- Tetra Technologies Inc (TTI) reported a 14% sequential revenue growth and a 32% increase in adjusted EBITDA for the second quarter of 2024.
- The company secured a significant three-well deepwater Gulf of Mexico CS Neptune fluids project, marking a milestone with a super major oil and gas operator.
- Adjusted EBITDA margins for the completion fluids and products segment reached 28.9%, and the water and flowback segment rebounded to 15.2%.
- Tetra Technologies Inc (TTI) is advancing strategic initiatives, including water desalination for beneficial reuse and zinc bromide electrolyte for energy storage, which are expected to provide material financial benefits.
- The company has a strong liquidity position of approximately $187 million, with no outstanding debt on its asset-based loan facility, providing flexibility for growth initiatives.
- The second-quarter adjusted EBITDA was negatively impacted by $1.1 million in foreign exchange losses.
- Revenue was down 2% year-over-year, reflecting a decline in US onshore rig activity by approximately 16%.
- The company faced operational challenges due to a strike by port workers in Finland and harsh winter conditions, affecting the calcium chloride business.
- The delay in launching the first commercial water desalination project in South Texas was unexpected, linked to regulatory requirements.
- There is uncertainty in the timing of key strategic initiatives, such as the CS Neptune project and the Arkansas bromine and lithium projects, due to emerging market conditions and regulatory challenges.
Good morning, and welcome to TETRA Technologies second-quarter 2024 results conference call. (Operator Instructions) Please note that this event is being recorded.
I will now turn the conference over to Julian Higuera. Please go ahead.
Good morning and thank you for joining TETRA's second-quarter 2024 results call. The speakers for today's call are Brady Murphy, Chief Executive Officer; and Elijio Serrano, Chief Financial Officer.
I would like to remind you that this conference call may contain statements that are or may be deemed to be forward looking, including projections, financial guidance, profitability and estimated earnings. These statements are based on certain assumptions and analysis made by TETRA and are based on several factors. These statements are subject to several risks and uncertainties, many of which are beyond the control of the company. You are cautioned that such statements are not guarantees of future performance and that actual results may differ
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