Business Wire News

  • Babcock & Wilcox Construction Co., LLC provides single-source, in-depth expertise for baseload power generation across North America

AKRON, Ohio--(BUSINESS WIRE)--$BW--Babcock & Wilcox (B&W) (NYSE: BW) announced today that its B&W Thermal segment will perform boiler maintenance and refurbish a bottom ash system for a power plant in North America. The contract is valued at more than $7 million and was awarded to B&W’s subsidiary, Babcock & Wilcox Construction Co., LLC (BWCC).


The work is scheduled for the spring of 2021. The project scope includes boiler and auxiliary equipment repairs, maintenance work and outage support for the plant.

“As an important part of B&W Thermal’s product and service offerings, BWCC is a single-source turnkey supplier of a full range of field construction, construction management, installation, refurbishment and maintenance services,” said B&W Chief Operating Officer Jimmy Morgan. “BWCC’s network of regional service centers and extensive experience with a wide range of projects allows us to respond quickly to customers’ needs and provide safe, reliable solutions at any facility.”

B&W Thermal offers a comprehensive suite of equipment and solutions to keep the power fleet running reliably and efficiently. With more than 150 years’ experience in the power industry, B&W Thermal is one of the few U.S. companies with the technical capabilities needed to service thermal plants, boilers and emissions control equipment, no matter what type of challenges customers may face.

About B&W

Headquartered in Akron, Ohio, B&W is a global leader in energy and environmental technologies and services for the power and industrial markets. Follow B&W on LinkedIn and learn more at www.babcock.com.

About B&W Thermal

Babcock & Wilcox Thermal designs, manufactures and erects steam generation equipment, aftermarket parts, construction, maintenance and field services for plants in the power generation, oil & gas, and industrial sectors. B&W Thermal has an extensive global base of installed equipment for utilities and general industrial applications including refining, petrochemical, food processing, metals and more.

Forward-Looking Statements

B&W cautions that this release contains forward-looking statements, including, without limitation, statements relating to the execution and completion of a contract to perform boiler maintenance and refurbish a bottom ash system for a power plant in North America. These forward-looking statements are based on management’s current expectations and involve a number of risks and uncertainties. For a more complete discussion of these risk factors, see our filings with the Securities and Exchange Commission, including our most recent annual report on Form 10-K. If one or more of these risks or other risks materialize, actual results may vary materially from those expressed. We caution readers not to place undue reliance on these forward-looking statements, which speak only as of the date of this release, and we undertake no obligation to update or revise any forward-looking statement, except to the extent required by applicable law.


Contacts

Investor:
Megan Wilson
Vice President, Corporate Development & Investor Relations
Babcock & Wilcox
704.625.4944 | This email address is being protected from spambots. You need JavaScript enabled to view it.

Media:
Ryan Cornell
Public Relations
Babcock & Wilcox
330.860.1345 | This email address is being protected from spambots. You need JavaScript enabled to view it.

Partnership will focus on real-time monitoring, compliance, and price risk management for corporate PPAs and enable 24/7 carbon free electricity through intelligent power management


REDWOOD CITY, Calif. & WYOMISSING, Pa.--(BUSINESS WIRE)--AutoGrid, the market leader in AI-powered flexibility management software for the energy industry, today announced a strategic partnership with electricity provider American PowerNet (APN) to offer AutoGrid FlexTM for renewable energy monitoring and optimization to corporate customers and other large power consumers.

This partnership marries APN’s specialized expertise in wholesale and renewable energy management services with AutoGrid’s flagship application AutoGrid FlexTM, allowing large corporate customers to reduce cost, manage risk, and achieve corporate sustainability goals.

With over 5,000 MW of assets under contract, and experience of managing distributed energy resources (DERs) in 12 countries, AutoGrid Flex is the leading flexibility management solutions globally.

Corporate renewable energy procurement has surged dramatically in recent years, and Corporate Power Purchase Agreements (PPAs) are predicted to account for 20% of new renewable generation in the U.S. by 2030. Driven by ambitious sustainability goals and environmental, social, and corporate governance (ESG) initiatives, companies are taking active roles in energy management as a strategic and differentiating priority. As corporate energy management increases in scope and sophistication, there is a growing need for operational visibility, advanced analytics, and asset orchestration solutions to manage complex renewable portfolios. Robust marketplaces and services have emerged to facilitate renewable energy procurement, but few solutions focus on maximizing operational and economic efficiency of these assets once they are in operation.

“Large corporate energy consumers have both economic and reputational incentive to improve energy operations, and many of the power industry’s largest advancements are being undertaken by frontier-pushing corporations,” said Scott Helm, chief executive officer of American PowerNet. “Ambitious objectives such as net-zero energy, electric vehicle fleet deployments, and 24/7 renewable power matching are being actively pursued with CEO sponsorship and significant financial investment. This partnership brings our deep experience with AutoGrid’s cutting-edge technology in use by leading independent power producers and utilities to support corporate renewable energy consumers.”

“As large corporations take more active roles in procuring, balancing, and optimizing their energy use, they will increasingly require tools that were traditionally reserved for electric utilities or energy companies.” said Alex Pratt, Senior Director of Business Development at AutoGrid. “Indeed, many corporations purchase and consume far more power than some electric utilities, and the AutoGrid Flex platform enables real-time visibility and controls across both the renewable supply and demand sides of operations, even if assets are distributed geographically across a global corporate footprint.”

About AutoGrid:

AutoGrid builds AI-powered software solutions that enables a smarter energy world. The company’s suite of flexibility management applications allows utilities, electricity retailers, renewable energy project developers and energy service providers to deliver clean, affordable and reliable energy by managing networked distributed energy resources (DERs) in real time, at scale through different value streams. AutoGrid’s flagship application, AutoGrid Flex, is ranked as the #1 Virtual Power Plant Platform in the world according to the global ranking published in 2020 by industry-leading research and analysis firm Guidehouse (formerly, Navigant Research).

About American PowerNet:

American PowerNet (APN) is a 25 year old independent power supply company providing retail and wholesale electric supply services throughout the United States. APN is dedicated to providing industry-leading energy management expertise to commercial, industrial, and governmental entities. American PowerNet is a member of six U.S. RTOs and provides transparent access to the wholesale markets. American PowerNet’s services focus on direct access to the wholesale markets enabling large customers to manage the basis risk associated with their VPPA/PPAs.


Contacts

Media Contact:
Leo Traub
Antenna Group for AutoGrid
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

  • Second quarter sales of $28 million yielded $0.27 earnings per share
  • Orders were $35.0 million in the quarter; Backlog improved sequentially to $114.9 million
  • Revenue guidance increased to $93 million to $97 million and gross margin expectation improved to 21% to 23%

BATAVIA, N.Y.--(BUSINESS WIRE)--Graham Corporation (NYSE: GHM), a global business that designs, manufactures and sells critical equipment for the oil refining, petrochemical and defense industries, today reported financial results for its second quarter ended September 30, 2020. Graham’s current fiscal year ends March 31, 2021 (“fiscal 2021”).


James R. Lines, Graham’s President and Chief Executive Officer, commented, “Results in the second quarter benefited from strong defense industry sales, including a materials only order. We also had the benefit of improved efficiencies in both our supply chain and our production facilities which enabled us to accelerate conversion of both large and short cycle orders in the quarter. As a result, higher volume drove operating leverage which is inherent in our business model.”

Mr. Lines continued, “We had strong orders in the quarter of $35 million. This order level was driven by our strategy to further our geographic market reach and diversify our end markets, which includes increasing our participation in the defense industry. We remain confident in our ability to achieve the long-term goal of significantly growing our business organically, as well as continuing to consider acquisition opportunities.”

Second Quarter Fiscal 2021 Sales Summary (Compared with the prior-year period unless noted otherwise. See accompanying financial tables for a breakdown of sales by industry and region)

Net sales were $28.0 million compared with $21.6 million in the second quarter of fiscal 2020. The strong increase in sales reflects Graham’s strategy to increase its defense business sales with the U.S. Navy and sales to previously underserved markets.

Sales to the defense markets were up $6.8 million to $9.4 million compared with the prior year period and represented 34% of total sales. Sales to the chemical/petrochemical market were $5.5 million compared with $10.5 million in the prior year. Sales to the refining market increased $4.0 million to $10.3 million and sales to other commercial markets increased $0.6 million to $2.8 million.

From a geographic perspective, domestic sales were 62% of total sales compared with 73% in the second quarter of fiscal 2020. International sales were 38% of total sales, compared with 27% in the prior-year period.

Fluctuations in Graham’s sales among geographic locations and industries can vary measurably from quarter-to-quarter based on the timing and magnitude of projects. Graham does not believe that such quarter-to-quarter fluctuations are indicative of business trends, which it believes are more apparent on a trailing twelve-month basis.

Second Quarter Fiscal 2021 Performance Review*(Compared with the prior-year period unless noted otherwise)

 
($ in millions except per share data)

Q2 FY21

 

Q2 FY20

 

Change

Net sales

$

28.0

 

$

21.6

 

$

6.4

Gross profit

$

7.7

 

$

4.9

 

$

2.8

Gross margin

 

27.5

%

 

22.9

%

Operating profit

$

3.4

 

$

1.1

 

$

2.3

Operating margin

 

12.3

%

 

5.1

%

Net income

$

2.7

 

$

1.2

 

$

1.5

Diluted EPS

$

0.27

 

$

0.12

 

EBITDA

$

4.0

 

$

1.7

 

$

2.3

EBITDA margin

 

14.2

%

 

7.8

%

*Graham believes that EBITDA (defined as consolidated net income before net interest income, income taxes, depreciation, and amortization), and EBITDA margin (EBITDA as a percentage of sales), which are non-GAAP measures, help in the understanding of its operating performance. Moreover, Graham’s credit facility also contains ratios based on EBITDA. See the attached table on page 10 for additional important disclosures regarding Graham’s use of EBITDA and EBITDA margin as well as the reconciliation of net income to EBITDA.

Gross margin expanded 460 basis points to 27.5% driven by higher volume level as well as favorable mix of projects.

Selling, general and administrative (“SG&A”) expenses, were $4.3 million, up $0.4 million, or 11%, compared with the prior-year period. SG&A, as a percent of sales for the three-month periods ended September 30, 2020 and 2019 were 15.2% and 17.8%, respectively.

Operating profit was $3.4 million, up from $1.1 million last year. Net income was $2.7 million, or $0.27 per share compared with $1.2 million or $0.12 per share last year.

EBITDA margin expanded 640 basis points on higher volume and lower relative operating expenses.

First Half Fiscal 2021 Performance Review (Compared with the prior-year period unless noted otherwise)

 
($ in millions except per share data) YTD FY21 YTD FY20 Change
Net sales

$

44.7

 

$

42.2

 

$

2.5

 

Gross profit

$

9.3

 

$

9.7

 

$

(0.4

)

Gross margin

 

20.7

%

 

22.9

%

Operating profit

$

1.1

 

$

0.7

 

$

0.4

 

Operating margin

 

2.5

%

 

1.7

%

Net income

$

0.9

 

$

1.3

 

$

(0.4

)

Diluted EPS

$

0.09

 

$

0.13

 

EBITDA

$

2.2

 

$

1.9

 

$

0.3

 

EBITDA margin

 

4.9

%

 

4.5

%

International sales were $18.0 million and represented 40% of total sales, compared with $12.1 million, or 29%, of sales in the same prior-year period. Sales to the U.S. were $26.7 million, or 60%, of first half net sales in fiscal 2021, compared with $30.1 million, or 71%, of fiscal 2020 first half net sales.

Gross profit and margin were down compared with the prior-year period primarily as a result of production capability being significantly reduced in the first quarter fiscal 2021 due to the COVID-19 pandemic. Production during that period was at approximately 50% of normal production.

SG&A was $8.2 million, down 3%, or $0.2 million. As a percent of sales, SG&A was 18% in the quarter down from 20% in the same prior-year period. Included in the first half of 2020 was $0.6 million of SG&A for our divested commercial nuclear utility business

The effective tax rate was 30% compared with 22% in the prior-year period. The higher six-month tax rate in fiscal 2021 was due to the loss incurred in the first quarter.

Strong Balance Sheet with Ample Liquidity

Cash, cash equivalents and investments at September 30, 2020 decreased $5.1 million to $67.9 million from March 31, 2020.

Net cash used by operating activities for the first half of fiscal 2021 was $2.3 million, compared with $1.9 million of cash used for the first half of fiscal 2020. In the most recent quarter, cash used by operating activities was principally due to timing of accounts receivable and accounts payable.

Capital spending was $0.5 million in the second quarter of fiscal 2021 and was $0.8 million year-to-date. The Company expects capital expenditures for fiscal 2021 to be between $2.0 million and $2.5 million, of which 80% to 85% is expected to be for machinery and equipment and the remainder to be used for other items.

As of September 30, 2020, Graham had no debt.

Orders and Backlog

Orders for the quarter increased $2.4 million to $35.0 million. Defense orders increased $11.1 million to $12.6 million in the second quarter of fiscal 2021 more than offsetting the estimated impact the COVID-19 pandemic had on capital spending decisions by Graham’s historic refining and petrochemical customers, primarily in North America, during the quarter. Chemical and petrochemical orders were $3.3 million, compared with $6.2 million in the prior-year period. Refining orders were $16.8 million in the current quarter, compared with $22.6 million in the second quarter of fiscal 2020. The company believes that the pipeline of available opportunities in the defense industry remains strong, and that the timing of orders in this industry can be variable.

Domestic orders were 46% of total net orders in the second quarter of fiscal 2021 and were 33% in the same prior-year period.

Backlog at the end of the second quarter of fiscal 2021 was $114.9, an increase of $7.7 million from June 30, 2020. The increase reflects previously announced orders placed in the second quarter valued at $28.5 million.

Backlog by industry at September 30, 2020 was approximately:

  • 50% for U.S. Navy projects
  • 37% for refinery projects
  • 9% for chemical/petrochemical projects
  • 4% for other industrial applications

The Company expects 60% to 65% of backlog to convert to revenue within the next 12 months.

Increasing Fiscal 2021 Guidance

Mr. Lines concluded, “Nearly all of our expected second half revenue this year is already in backlog, giving us solid confidence to increase guidance for fiscal 2021. Orders in the second quarter add to fiscal 2022 revenue potential. The strength of revenue next fiscal year will depend upon orders during the next three quarters.”

Graham is increasing revenue guidance for fiscal 2021 while raising expectations for gross margin and tightening the range for SG&A expense. This guidance is based on the assumption that Graham is able to operate its production facility at full capacity, has access to its global supply chain including its subcontractors, and experiences minimal or no additional COVID-19 related disruptions or any other unforeseen events.

  • Revenue between $93 million and $97 million
  • Gross margin between 21% and 23%
  • SG&A expense between $17.0 million and $17.5 million
  • Effective tax rate of approximately 22%

Webcast and Conference Call

Graham’s management will host a conference call and live webcast today at 11:00 a.m. Eastern Time to review its financial condition and operating results for the second quarter of fiscal 2021, as well as its strategy and outlook. The review will be accompanied by a slide presentation which will be made available immediately prior to the conference call on Graham’s website at www.graham-mfg.com under the heading “Investor Relations.” A question-and-answer session will follow the formal presentation.

Graham’s conference call can be accessed by calling (201) 689-8560. Alternatively, the webcast can be monitored on Graham’s website at www.graham-mfg.com under the heading “Investor Relations.”

A telephonic replay will be available from 2:00 p.m. ET today through Wednesday, November 4, 2020. To listen to the archived call, dial (412) 317-6671 and enter conference ID number 13710948. A transcript of the call will be placed on Graham’s website, once available.

ABOUT GRAHAM CORPORATION

Graham is a global business that designs, manufactures and sells critical equipment for the energy, defense and chemical/petrochemical industries. Energy markets include oil refining, cogeneration, and alternative power. For the defense industry, the Company’s equipment is used in nuclear propulsion power systems for the U.S. Navy. Graham’s global brand is built upon world-renowned engineering expertise in vacuum and heat transfer technology, responsive and flexible service and unsurpassed quality.

Graham designs and manufactures custom-engineered ejectors, vacuum pumping systems, surface condensers and vacuum systems. Graham’s equipment can also be found in other diverse applications such as metal refining, pulp and paper processing, water heating, refrigeration, desalination, food processing, pharmaceutical, heating, ventilating and air conditioning. Graham’s reach spans the globe and its equipment is installed in facilities from North and South America to Europe, Asia, Africa and the Middle East.

Graham routinely posts news and other important information on its website, www.graham-mfg.com, where additional comprehensive information on Graham Corporation and its subsidiaries can be found.

Safe Harbor Regarding Forward Looking Statements

This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.

Forward-looking statements are subject to risks, uncertainties and assumptions and are identified by words such as “expects,” “estimates,” “confidence,” “projects,” “typically,” “outlook,” “anticipates,” “believes,” “appears,” “could,” “opportunities,” “seeking,” “plans,” “aim,” “pursuit,” “look towards” and other similar words. All statements addressing operating performance, events, or developments that Graham Corporation expects or anticipates will occur in the future, including but not limited to, effects of the COVID-19 global pandemic, expected expansion and growth opportunities within its domestic and international markets, anticipated revenue, the timing of conversion of backlog to sales, market presence, profit margins, tax rates, foreign sales operations, its ability to improve cost competitiveness and productivity, customer preferences, changes in market conditions in the industries in which it operates, the effect on its business of volatility in commodities prices, including, but not limited to, the extreme price volatility seen in the first six months of calendar year 2020, changes in general economic conditions and customer behavior, forecasts regarding the timing and scope of the economic recovery in its markets, its acquisition and growth strategy and its operations in China, India and other international locations, are forward-looking statements. Because they are forward-looking, they should be evaluated in light of important risk factors and uncertainties. These risk factors and uncertainties are more fully described in Graham Corporation’s most recent Annual Report filed with the Securities and Exchange Commission, included under the heading entitled “Risk Factors.”

Should one or more of these risks or uncertainties materialize or should any of Graham Corporation’s underlying assumptions prove incorrect, actual results may vary materially from those currently anticipated. In addition, undue reliance should not be placed on Graham Corporation’s forward-looking statements. Except as required by law, Graham Corporation disclaims any obligation to update or publicly announce any revisions to any of the forward-looking statements contained in this news release.

 

Graham Corporation

Second Quarter Fiscal 2021

Consolidated Statements of Operations - Unaudited

(Amounts in thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

September 30,

 

September 30,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

2019

 

% Change

 

2020

 

2019

 

% Change

Net sales

 

$

27,954

 

 

$

21,643

 

 

29

%

 

$

44,664

 

 

$

42,236

 

 

6

%

Cost of products sold

 

 

20,261

 

 

 

16,695

 

 

21

%

 

 

35,403

 

 

 

32,574

 

 

9

%

Gross profit

 

 

7,693

 

 

 

4,948

 

 

55

%

 

 

9,261

 

 

 

9,662

 

 

(4

%)

Gross margin

 

 

27.5

%

 

 

22.9

%

 

 

 

 

20.7

%

 

 

22.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other expenses and income:

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

4,253

 

 

 

3,847

 

 

11

%

 

 

8,155

 

 

 

8,403

 

 

(3

%)

Selling, general and administrative – amortization

 

 

-

 

 

 

-

 

 

NA

 

 

-

 

 

 

11

 

 

NA

Other expense

 

 

-

 

 

 

-

 

 

NA

 

 

-

 

 

 

523

 

 

NA

Operating profit

 

 

3,440

 

 

 

1,101

 

 

212

%

 

 

1,106

 

 

 

725

 

 

53

%

Operating margin

 

 

12.3

%

 

 

5.1

%

 

 

 

 

2.5

%

 

 

1.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income

 

 

(54

)

 

 

(87

)

 

(38

%)

 

 

(109

)

 

 

(174

)

 

(37

%)

Interest income

 

 

(26

)

 

 

(363

)

 

(93

%)

 

 

(120

)

 

 

(762

)

 

(84

%)

Interest expense

 

 

3

 

 

 

4

 

 

(25

%)

 

 

8

 

 

 

7

 

 

14

%

Income before provision for income taxes

 

 

3,517

 

 

 

1,547

 

 

127

%

 

 

1,327

 

 

 

1,654

 

 

(20

%)

Provision for income taxes

 

 

773

 

 

 

342

 

 

126

%

 

 

401

 

 

 

367

 

 

9

%

Net income

 

$

2,744

 

 

$

1,205

 

 

128

%

 

$

926

 

 

$

1,287

 

 

(28

%)

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share data:

 

 

 

 

 

 

 

 

 

 

 

 

Basic:

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

0.27

 

 

$

0.12

 

 

125

%

 

$

0.09

 

 

$

0.13

 

 

(31

%)

Diluted:

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

0.27

 

 

$

0.12

 

 

125

%

 

$

0.09

 

 

$

0.13

 

 

(31

%)

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

9,977

 

 

 

9,883

 

 

 

 

 

9,936

 

 

 

9,869

 

 

 

Diluted

 

 

9,977

 

 

 

9,885

 

 

 

 

 

9,936

 

 

 

9,872

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends declared per share

 

$

0.11

 

 

$

0.11

 

 

 

 

$

0.22

 

 

$

0.21

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

N/A: Not Applicable

 

 

 

 

 

 

 

 

 

 

 

 

Graham Corporation

Second Quarter Fiscal 2021

Consolidated Balance Sheets - Unaudited

(Amounts in thousands, except per share data)

September 30,

 

March 31,

2020

 

2020

Assets
Current assets:
Cash and cash equivalents

$

62,356

 

$

32,955

 

Investments

 

5,500

 

 

40,048

 

Trade accounts receivable, net of allowances ($41 and $33 at September 30 and March 31, 2020, respectively)

 

19,276

 

 

15,400

 

Unbilled revenue

 

13,691

 

 

14,592

 

Inventories

 

20,615

 

 

22,291

 

Prepaid expenses and other current assets

 

1,378

 

 

906

 

Income taxes receivable

 

322

 

 

485

 

Total current assets

 

123,138

 

 

126,677

 

Property, plant and equipment, net

 

17,327

 

 

17,587

 

Prepaid pension asset

 

3,881

 

 

3,460

 

Operating lease assets

 

171

 

 

243

 

Other assets

 

105

 

 

153

 

Total assets

$

144,622

 

$

148,120

 

 
Liabilities and stockholders’ equity
Current liabilities:
Current portion of finance lease obligations

$

26

 

$

40

 

Accounts payable

 

11,669

 

 

14,253

 

Accrued compensation

 

5,082

 

 

4,453

 

Accrued expenses and other current liabilities

 

3,867

 

 

3,352

 

Customer deposits

 

24,838

 

 

26,983

 

Operating lease liabilities

 

110

 

 

153

 

Total current liabilities

 

45,592

 

 

49,234

 

Finance lease obligations

 

45

 

 

55

 

Operating lease liabilities

 

53

 

 

82

 

Deferred income tax liability

 

988

 

 

721

 

Accrued pension liability

 

800

 

 

747

 

Accrued postretirement benefits

 

567

 

 

557

 

Total liabilities

 

48,045

 

 

51,396

 

 
Stockholders’ equity:
Preferred stock, $1.00 par value, 500 shares authorized

 

-

 

 

-

 

Common stock, $0.10 par value, 25,500 shares authorized, 10,780 and 10,689 shares issued and 9,977 and 9,881 shares outstanding at September 30 and March 31, 2020, respectively

 

1,078

 

 

1,069

 

Capital in excess of par value

 

26,866

 

 

26,361

 

Retained earnings

 

90,120

 

 

91,389

 

Accumulated other comprehensive loss

 

(8,992

)

 

(9,556

)

Treasury stock (803 and 808 shares at September 30 and March 31, 2020, respectively)

 

(12,495

)

 

(12,539

)

Total stockholders’ equity

 

96,577

 

 

96,724

 

Total liabilities and stockholders’ equity

$

144,622

 

$

148,120

 

 

Graham Corporation

Second Quarter Fiscal 2021

Consolidated Statements of Cash Flows – Unaudited

(Amounts in thousands)

Six Months Ended

September 30,

2020

 

2019

Operating activities:
Net income

$

926

 

$

1,287

 

Adjustments to reconcile net income to net cash used by operating activities:
Depreciation

 

972

 

 

980

 

Amortization

 

-

 

 

11

 

Amortization of actuarial losses

 

533

 

 

498

 

Equity-based compensation expense

 

494

 

 

412

 

Gain on disposal or sale of property, plant and equipment

 

3

 

 

-

 

Loss on sale of Energy Steel & Supply Co.

 

-

 

 

87

 

Deferred income taxes

 

191

 

 

119

 

(Increase) decrease in operating assets:
Accounts receivable

 

(3,820

)

 

5,287

 

Unbilled revenue

 

901

 

 

(5,514

)

Inventories

 

1,808

 

 

990

 

Prepaid expenses and other current and non-current assets

 

(456

)

 

109

 

Income taxes receivable

 

163

 

 

233

 

Operating lease assets

 

75

 

 

138

 

Prepaid pension asset

 

(421

)

 

(435

)

Increase (decrease) in operating liabilities:
Accounts payable

 

(2,544

)

 

(4,721

)

Accrued compensation, accrued expenses and other current and non-current liabilities

 

1,214

 

 

(268

)

Customer deposits

 

(2,285

)

 

(1,116

)

Operating lease liabilities

 

(75

)

 

(64

)

Long-term portion of accrued compensation, accrued pension liability and accrued postretirement benefits

 

63

 

 

52

 

Net cash used by operating activities

 

(2,258

)

 

(1,915

)

 
Investing activities:
Purchase of property, plant and equipment

 

(797

)

 

(679

)

Proceeds from disposal of property, plant and equipment

 

6

 

 

-

 

Proceeds from the sale of Energy Steel & Supply Co.

 

-

 

 

602

 

Purchase of investments

 

(31,603

)

 

(82,414

)

Redemption of investments at maturity

 

66,151

 

 

83,232

 

Net cash provided by investing activities

 

33,757

 

 

741

 

 
Financing activities:
Principal repayments on finance lease obligations

 

(24

)

 

(25

)

Principal repayments on long-term debt

 

(4,599

)

 

-

 

Proceeds from the issuance of long-term debt

 

4,599

 

 

-

 

Dividends paid

 

(2,195

)

 

(2,075

)

Purchase of treasury stock

 

(23

)

 

(230

)

Net cash used by financing activities

 

(2,242

)

 

(2,330

)

Effect of exchange rate changes on cash

 

144

 

 

(187

)

Net increase (decrease) in cash and cash equivalents, including cash classified within current assets held for sale

 

29,401

 

 

(3,691

)

Net decrease in cash classified within current assets held for sale

 

-

 

 

552

 

Net increase (decrease) in cash and cash equivalents

 

29,401

 

 

(3,139

)

Cash and cash equivalents at beginning of period

 

32,955

 

 

15,021

 

Cash and cash equivalents at end of period

$

62,356

 

$

11,882

 

 

Graham Corporation

Second Quarter Fiscal 2021

EBITDA Reconciliation - Unaudited

(Amounts in thousands)

 

Three Months Ended

 

Six Months Ended

September 30,

 

September 30,

2020

 

2019

 

2020

 

2019

Net income

$

2,744

 

 

$

1,205

 

$

926

 

 

$

1,287

 

Net interest income

 

(23

)

 

 

(359

)

 

(112

)

 

 

(755

)

Income taxes

 

773

 

 

 

342

 

 

401

 

 

 

367

 

Depreciation & amortization

 

486

 

 

 

490

 

 

972

 

 

 

991

 

EBITDA

$

3,980

 

 

$

1,678

 

$

2,187

 

 

$

1,890

 

EBITDA margin %

 

14.2

%

 

 

7.8

%

 

4.9

%

 

 

4.5

%

Non-GAAP Financial Measure:

EBITDA is defined as consolidated net income before net interest income, income taxes, depreciation, and amortization and EBITDA margin is defined as EBITDA as a percentage of sales. EBITDA and EBITDA margin are not measures determined in accordance with generally accepted accounting principles in the United States, commonly known as GAAP. Nevertheless, Graham believes that providing non-GAAP information, such as EBITDA, is important for investors and other readers of Graham's financial statements, as it is used as an analytical indicator by Graham's management to better understand operating performance. Moreover, Graham’s credit facility also contains ratios based on EBITDA. Because EBITDA is a non-GAAP measure and is thus susceptible to varying calculations, EBITDA, as presented, may not be directly comparable to other similarly titled measures used by other companies.

Graham Corporation
Second Quarter Fiscal 2021
Additional Information – Unaudited

ORDER & BACKLOG TREND
($ in millions)
 

Q120

 

Q220

 

Q320

 

Q420

 

FY2020

 

Q121

 

Q221

Total

 

Total

 

Total

 

Total

 

Total

 

Total

 

Total

Orders

$

15.1

$

32.6

$

20.0

$

12.3

$

80.0

$

11.5

$

35.0

Backlog

$

117.2

$

127.8

$

122.9

$

112.4

$

112.4

$

107.2

$

114.9

 
SALES BY INDUSTRY FY 2021
($ in millions)
 
FY 2021 Q1 % of Q2 % of
6/30/20 Total 9/30/20 Total
Refining

$

2.7

16

%

$

10.3

37

%

Chemical/ Petrochemical

$

8.0

48

%

$

5.5

20

%

Defense

$

3.5

21

%

$

9.4

34

%

Other Commercial

$

2.5

15

%

$

2.8

10

%

Total

$

16.7

$

28.0

 
SALES BY INDUSTRY FY 2020
($ in millions)
 
FY 2020

Q1

 

% of

 

Q2

 

% of

 

Q3

 

% of

 

Q4

 

% of

 

FY2020

 

% of

6/30/19

 

Total

 

9/30/19

 

Total

 

12/31/19

 

Total

 

3/31/20

 

Total

 

 

 

Total

Refining

$

7.5

36

%

$

6.3

29

%

$

12.2

49

%

$

7.4

32

%

$

33.4

37

%

Chemical/ Petrochemical

$

7.1

35

%

$

10.5

48

%

$

6.2

24

%

$

7.1

31

%

$

30.9

34

%

Defense

$

2.1

10

%

$

2.6

12

%

$

4.3

17

%

$

5.6

24

%

$

14.6

16

%

Other Commercial

$

3.9

19

%

$

2.2

11

%

$

2.6

10

%

$

3.0

13

%

$

11.7

13

%

Total

$

20.6

$

21.6

$

25.3

$

23.1

$

90.6

 

Graham Corporation
Second Quarter Fiscal 2021
Additional Information - Unaudited
(Continued)

 

SALES BY REGION FY 2021

($ in millions)
 
FY 2021 Q1 % of Q2 % of
6/30/20 Total 9/30/20 Total
United States

$

9.4

56

%

$

17.3

62

%

Middle East

$

0.4

3

%

$

1.0

4

%

Asia

$

5.2

31

%

$

4.5

16

%

Other

$

1.7

10

%

$

5.2

18

%

Total

$

16.7

$

28.0

 
SALES BY REGION FY 2020
($ in millions)
 
FY 2020 Q1 % of Q2 % of Q3 % of Q4 % of FY2020 % of
6/30/19 Total 9/30/19 Total 12/31/19 Total 3/31/20 Total Total
United States

$

14.4

70

%

$

15.7

73

%

$

13.4

53

%

$

14.5

63

%

$

58.0

64

%

Middle East

$

0.8

4

%

$

0.5

2

%

$

7.5

30

%

$

4.3

19

%

$

13.1

14

%

Asia

$

3.2

16

%

$

1.0

5

%

$

0.7

3

%

$

0.6

2

%

$

5.5

6

%

Other

$

2.2

10

%

$

4.4

20

%

$

3.7

14

%

$

3.7

16

%

$

14.0

16

%

Total

$

20.6

$

21.6

$

25.3

$

23.1

$

90.6

 


Contacts

Jeffrey F. Glajch
Vice President – Finance and CFO
Phone: (585) 343-2216
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Deborah K. Pawlowski / Christopher M. Gordon
Kei Advisors LLC
Phone: (716) 843-3908 / (716) 843-3748
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SANTA CLARITA, Calif.--(BUSINESS WIRE)--California Resources Corporation (NYSE: CRC) will host its third quarter 2020 financial results conference call on Thursday, November 5th at 5:00 p.m. EST (2:00 p.m. PST). The Company’s earnings will be released following the market close on the same date.


We encourage participants to pre-register for the conference call webcast using the following link http://dpregister.com/10140527. Callers who pre-register will be given a conference passcode and unique PIN to gain immediate access to the call and bypass the live operator. Participants may pre-register at any time, including up to and after the call start time.

To participate in CRC’s conference call, either dial (877) 328-5505 (International callers please dial +1-412-317-5421) or access via webcast at www.crc.com, fifteen minutes prior to the scheduled start time to register. A digital replay of the conference call will be archived for approximately 90 days and available online on the Investor Relations page at www.crc.com.

About California Resources Corporation (CRC)

California Resources Corporation (CRC) is the largest oil and natural gas exploration and production company in California. CRC operates its world-class resource base exclusively within the State of California, applying complementary and integrated infrastructure to gather, process and market its production. Using advanced technology, CRC focuses on safely and responsibly supplying affordable energy for California by Californians.


Contacts

Scott Espenshade (Investor Relations)
818-661-6010
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Margita Thompson (Media)
818-661-6005
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~Achieves Highest Revenue and Earnings in Company’s History~

~Revenue Approaches $400 Million in Fourth Quarter; 33% Same-Store Sales Growth~

~Fourth Quarter Earnings Per Share More than Tripled to $1.13; Adjusted EPS $1.19~

~Fiscal 2020 Revenue Exceeds $1.5 Billion; 25% Same-Store Sales Growth~

~Fiscal 2020 Earnings Per Share More than Doubled to $3.37; Adjusted EPS $3.42~

~Company Provides Annual Guidance for Fiscal 2021~

CLEARWATER, Fla.--(BUSINESS WIRE)--MarineMax, Inc. (NYSE: HZO), the nation’s largest recreational boat and yacht retailer, today announced record results for its fourth quarter and full year ended September 30, 2020.

Revenue grew over 29% to $398.8 million for the quarter ended September 30, 2020, from $308.1 million for the comparable quarter last year. The increase was driven by strong same-store sales growth of 33%. Included in the quarters ended September 30, 2020 and September 30, 2019, were net charges of $1.5 million or $0.06 per diluted share and $1.6 million, or $0.07 per diluted share, respectively. The charges primarily related to costs associated with the Company’s store optimization plan which resulted in the closure of one store in the current quarter and eight in the comparable quarter last year.

Net income for the quarter ended September 30, 2020, more than tripled to $25.6 million, or $1.13 per diluted share, compared to net income of $6.7 million, or $0.31 per diluted share in the comparable quarter last year. Excluding the charges in both periods, net income for the quarter ended September 30, 2020, grew to $27.1 million, with earnings per diluted share more than tripling to $1.19, as compared to $8.3 million or $0.38 per diluted share in the same period last year.

For the fiscal year ended September 30, 2020, revenue increased 22% to $1.51 billion compared with $1.24 billion for the same period last year. The growth was driven by strong same-store sales growth of 25%. Included in the years ended September 30, 2020 and September 30, 2019, were net charges of $1.3 million, or $0.05 per diluted share and $1.4 million, or $0.06 per diluted share, respectively. The charges primarily related to costs associated with the Company’s store optimization plan.

Net income for the fiscal year ended September 30, 2020, more than doubled to $74.6 million, or $3.37 per diluted share, compared to net income of $36.0 million, or $1.57 per diluted share in the prior year. Excluding the charges in both periods, net income for the year ended September 30, 2020, grew to $75.9 million, with earnings per diluted share more than doubling to $3.42, as compared to $37.3 million or $1.63 per diluted share in the same period last year.

W. Brett McGill, Chief Executive Officer and President stated, “The MarineMax Team generated a record $1.5 billion of revenue and more than doubled our earnings per share while overcoming these extremely uncertain times. We believe this demonstrates the strength and flexibility of our business model. I could not be prouder of the entire Team for their focus, hard work and passion for MarineMax. We also believe that the industry experienced a foundational shift in 2020, and specifically for MarineMax, it resulted in a greatly expanded customer base that is embracing and enjoying the boating lifestyle. We continue to add new customers at a seasonally accelerated pace. This foundational layer should provide sustainable growth for years to come, as many existing and new customers will upgrade to larger boats and need additional services.”

Mr. McGill continued, “Our deep manufacturer relationships and brand strategy provide us with a competitive advantage by supporting our ability to move inventory between stores to help satisfy the growing demand. Looking ahead, our business outlook remains promising as more people are realizing that boating is a safe way for families to spend time together enjoying the boating lifestyle. Our balance sheet is very well capitalized, allowing us to continue to pursue strategic accretive acquisitions, to strengthen and enhance our digital strategy, to expand with marinas and to further grow our higher margin businesses. We are happy that many people have rediscovered the benefits of the boating lifestyle, which gives us increased confidence for the future.”

At September 30, 2020, the Company’s liquidity exceeded $237 million, consisting of cash and cash equivalents along with availability under its credit facility.

Fiscal 2021 Guidance

Based on current business conditions, retail trends and other factors, the Company currently expects earnings per diluted share to be in the range of $3.70 to $3.90 for fiscal 2021. This includes earnings contributed by SkipperBud’s, which the Company acquired on October 1, 2020. This compares to a non-GAAP adjusted, but fully taxed, diluted earnings per share of $3.42 in fiscal 2020.

About MarineMax

Headquartered in Clearwater, Florida, MarineMax is the nation’s largest recreational boat and yacht retailer. Focused on premium brands such as Sea Ray, Boston Whaler, Hatteras, Azimut Yachts, Benetti, Ocean Alexander, Galeon, Grady-White, Harris, Bennington, Crest, MasterCraft, MJM Yachts, NauticStar, Scout, Sailfish, Tige, Yamaha Jet Boats, Aquila, Aviara, and Nautique. MarineMax sells new and used recreational boats and related marine products and services, as well as provides yacht brokerage and charter services. MarineMax currently has 77 retail locations in Alabama, California, Connecticut, Florida, Georgia, Illinois, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Jersey, New York, North Carolina, Ohio, Oklahoma, Rhode Island, South Carolina, Texas, Washington and Wisconsin. MarineMax also owns Fraser Yachts Group and Northrop & Johnson, leading superyacht brokerage and luxury yacht services companies with operations in multiple countries. The Company also owns and operates MarineMax Vacations in Tortola, British Virgin Islands. MarineMax is a New York Stock Exchange-listed company. For more information, please visit www.marinemax.com.

Forward Looking Statement

Certain statements in this press release are forward-looking as defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include the Company’s anticipated financial results for the fourth quarter and the fiscal year ended September 30, 2020; the foundational shift experienced by the Company and the overall industry and this shift's effects on potential future growth; the Company's competitive advantage and its effect on inventory and sales; the Company's business outlook; the Company's continued efforts to pursue strategic accretive acquisitions, strengthen and enhance its digital strategy, expand with marinas, and to further grow its higher margin businesses; and the Company's fiscal 2021 guidance. These statements are based on current expectations, forecasts, risks, uncertainties and assumptions that may cause actual results to differ materially from expectations as of the date of this release. These risks, assumptions and uncertainties include the Company’s abilities to reduce inventory, manage expenses and accomplish its goals and strategies, the quality of the new product offerings from the Company’s manufacturing partners, the performance and integration of the recently-acquired SkipperBud's business, the impacts (direct and indirect) of COVID-19 on the Company’s business, the Company’s employees, the Company’s manufacturing partners, and the overall economy, general economic conditions, as well as those within the Company's industry, the level of consumer spending, the Company’s ability to integrate acquisitions into existing operations, and numerous other factors identified in the Company’s Form 10-K for the fiscal year ended September 30, 2019 and other filings with the Securities and Exchange Commission. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

MarineMax, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Amounts in thousands, except share and per share data)

(Unaudited)

 

 

Three Months Ended
September 30,

 

Fiscal Year Ended
September 30,

 

2020

 

2019

 

2020

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

$ 398,762

 

$ 308,136

 

$ 1,509,713

 

$ 1,237,153

Cost of sales

282,296

 

220,694

 

1,111,000

 

914,321

Gross profit

116,466

 

87,442

 

398,713

 

322,832

 

 

 

 

 

 

 

 

Selling, general, and administrative expenses

83,714

 

74,864

 

291,998

 

262,300

Income from operations

32,752

 

12,578

 

106,715

 

60,532

 

 

 

 

 

 

 

 

Interest expense

785

 

3,094

 

9,275

 

11,579

Income before income tax provision

31,967

 

9,484

 

97,440

 

48,953

 

 

 

 

 

 

 

 

Income tax provision

6,384

 

2,799

 

22,806

 

12,968

Net income

$ 25,583

 

$ 6,685

 

$ 74,634

 

$ 35,985

 

 

 

 

 

 

 

 

Basic net income per common share

$ 1.18

 

$ 0.31

 

$ 3.46

 

$ 1.61

 

 

 

 

 

 

 

 

Diluted net income per common share

$ 1.13

 

$ 0.31

 

$ 3.37

 

$ 1.57

 

 

 

 

 

 

 

 

Weighted average number of common
shares used in computing net income per
common share:

 

 

 

 

 

 

 

Basic

21,716,081

 

21,327,669

 

21,547,665

 

22,294,114

Diluted

22,604,060

 

21,896,257

 

22,125,338

 

22,881,147

MarineMax, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Amounts in thousands)

(Unaudited)

 

 

September 30,
2020

 

September 30,
2019

ASSETS

 

CURRENT ASSETS:

 

 

 

Cash and cash equivalents

$ 155,493

 

$ 38,511

Accounts receivable, net

40,195

 

42,398

Inventories, net

298,002

 

477,468

Prepaid expenses and other current assets

9,637

 

10,206

Total current assets

503,327

 

568,583

 

 

 

Property and equipment, net

141,934

 

144,298

Operating lease right-of-use assets, net

37,991

 

Goodwill and other intangible assets, net

84,293

 

64,077

Other long-term assets

7,774

 

7,125

Total assets

$ 775,319

 

$ 784,083

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

CURRENT LIABILITIES:

 

 

 

Accounts payable

$ 37,343

 

$ 33,674

Customer deposits

31,821

 

24,305

Accrued expenses

52,123

 

42,849

Current operating lease liabilities

6,854

 

Short-term borrowings

144,393

 

312,065

Total current liabilities

272,534

 

412,893

 

 

 

Noncurrent operating lease liabilities

33,473

 

Deferred tax liabilities, net

4,509

 

1,142

Long-term debt, net of current maturities

7,343

 

Other long-term liabilities

2,063

 

1,229

Total liabilities

319,922

 

415,264

 

 

 

STOCKHOLDERS' EQUITY:

 

 

 

Preferred stock

 

Common stock

28

 

28

Additional paid-in capital

280,436

 

269,969

Accumulated other comprehensive income (loss)

829

 

(669)

Retained earnings

277,699

 

202,455

Treasury stock

(103,595)

 

(102,964)

Total stockholders’ equity

455,397

 

368,819

Total liabilities and stockholders’ equity

$ 775,319

 

$ 784,083

MarineMax, Inc. and Subsidiaries

Supplemental Financial Information

(Amounts in thousands, except share and per share data)

(Unaudited)

 

 

Three Months Ended
September 30,

 

Fiscal Year Ended
September 30,

 

2020

 

2019

 

2020

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$ 25,583

 

$ 6,685

 

$ 74,634

 

$ 35,985

Gain Deepwater Horizon settlement

 

(1,252)

 

 

(1,252)

Store closing expenses

1,659

 

3,091

 

1,659

 

3,091

Hurricane expenses

196

 

422

 

 

Pro forma tax adjustments for items noted above (1)

(371)

 

(667)

 

(388)

 

(487)

Adjusted net income

$ 27,067

 

$ 8,279

 

$ 75,905

 

$ 37,337

 

 

 

 

 

 

 

 

Diluted net income per common share

$ 1.13

 

$ 0.31

 

$ 3.37

 

$ 1.57

Gain Deepwater Horizon Settlement

 

(0.06)

 

 

(0.05)

Store closing expenses

0.07

 

0.14

 

0.07

 

0.14

Hurricane expenses

0.01

 

0.02

 

 

Pro forma tax adjustments for items noted above (1)

(0.02)

 

(0.03)

 

(0.02)

 

(0.03)

Adjusted diluted net income per common share

$ 1.19

 

$ 0.38

 

$ 3.42

 

$ 1.63

____________

(1)

  Adjustments for taxes for unusual items are calculated based on the effective tax rate for each respective period presented. 

 


Contacts

Michael H. McLamb
Chief Financial Officer
727-531-1700

Media:
Abbey Heimensen
MarineMax, Inc.

Investors:
Brad Cohen or Dawn Francfort
ICR, LLC
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Top honors span Product Data Management (PDM), Construction Drawing Management (CDM) and Enterprise Content Management (ECM) Categories

QUAKERTOWN, Pa.--(BUSINESS WIRE)--#G2Crowd--Synergis Software, a global leader in engineering information management and product data management (PDM), today announced that its flagship product, Adept, has earned 21 top placements in G2 Crowd’s Fall 2020 Grid Reports.



The reports, which are based on real customer reviews, highlight Adept’s leadership in ease of use, ease of setup, fastest implementation, best support and best relationship as some of the key differentiators compared to other products on the market.

Adept earned Leader status in Product Data Management (PDM) and Enterprise Content Management (ECM), and High Performer status in Construction Drawing Management.

“We're committed to helping clients become more efficient, secure and collaborative, and reports like this help us understand what we're doing well and how we can improve,” said Scott Lamond, vice president of marketing at Synergis Software. “We’re energized and honored that the voice of the customer has us ranked at the top of our field.”

Adept also achieved an exceptional 77 on the G2 Net Promoter Scorecard (NPS).

According to G2, “The purpose of NPS is to gauge customer loyalty to a brand, and how likely they are to recommend your product to a peer. An NPS at-or-above 70 is considered “world class.” Essentially, this means nearly every customer would advocate for that product."

Here’s what some Adept customers had to say:

  • “Data is the cornerstone of any business today and not securing it is a huge risk. If you want to do it right and do it well, the Adept platform is the gold-standard.”
  • “No other software company anywhere works as closely with their customers. For a system that your business cannot operate without, this is invaluable.”
  • “An immediate 30% gain in user efficiency”

Adept earned top honors in the following rankings:

Product Data Management - Best Usability, Easiest Setup, Fastest Implementation, Most Implementable, Ease of Administration, Ease of Doing Business, Quality of Support, Best Relationship, Most Likely to Recommend, Highest Net Promoter Score

Construction Drawing Management - Easiest to Use, Best Meets Requirements, Easiest Setup, Best Support, Highest User Adoption, Easiest to do Business With, Product Going in the Right Direction, Most likely to Recommend, Highest Net Promoter Score

Enterprise Content Management - Ease of Doing Business With, Best Search Capabilities

To see how Adept stacks up, download the full comparison report.

You can read more customer feedback on G2’s Adept review page.

Learn more about G2’s scoring methodology here.

About Synergis Software

Synergis Software is the leader in engineering document management and product data management, helping businesses become more efficient, secure and collaborative. The flagship product, Adept, gets everyone on the same page, simplifying the way organizations find, manage, share and integrate enterprise content. Adept streamlines engineering change management, protects intellectual property, and provides data insights to improve decision making. Adept is integrated with AutoCAD®, Autodesk Inventor®, SolidWorks® and MicroStation®, and has been battle tested by engineers for over 30 years in customers like Dow Chemical, Con Edison, General Mills, Bayer, and Nucor Steel.

G2 Crowd

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Scott Lamond
Vice President, Marketing
Synergis Software
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215-302-3006

SCHAFFHAUSEN, Switzerland--(BUSINESS WIRE)--Garmin Ltd. (Nasdaq: GRMN) today announced results for the third quarter ended September 26.


Highlights for third quarter 2020 include:

  • Total revenue of over $1.1 billion, a 19% year-over-year increase, led by robust growth in marine, fitness and outdoor
  • Gross margin and operating margin were 60.2% and 28.6%, respectively
  • Operating income of $317 million, increasing 21% over the prior year quarter
  • GAAP diluted EPS was $1.63 and pro forma diluted EPS(1) was $1.58, increasing 24% over the prior year quarter
  • Named Manufacturer of the Year by the National Marine Electronics Association for the sixth consecutive year
  • Since its launch in 2011, Garmin inReach® has provided remote communication and rescue facilitation in over 5,000 SOS incidents, demonstrating the crucial importance of satellite based two-way messaging wherever our customers need assistance
  • Began production shipments of the BMW MGU 2020 computing module, expanding our role as a tier-one supplier for BMW automobiles
  • Launched the Garmin Catalyst, an industry-first coaching tool to optimize motorsports driving performance
  • Garmin Autoland has achieved Federal Aviation Administration (FAA) certification in a total of three aircraft to-date with the latest being the Cirrus Vision Jet, the first jet aircraft to be certified with this game-changing safety technology

(in thousands, except per share data)

13-Weeks Ended

 

39-Weeks Ended

 

September 26,

 

September 28,

 

YoY

 

September 26,

 

September 28,

 

YoY

 

2020

 

2019

 

Change

 

2020

 

2019

 

Change

Net sales

$

1,109,194

 

$

934,383

 

19

%

$

2,835,168

 

$

2,655,273

 

7

%

Marine

 

165,437

 

 

107,694

 

54

%

 

486,269

 

 

393,070

 

24

%

Fitness

 

328,446

 

 

243,099

 

35

%

 

846,688

 

 

675,007

 

25

%

Outdoor

 

334,844

 

 

258,294

 

30

%

 

716,146

 

 

622,748

 

15

%

Auto

 

129,355

 

 

137,722

 

(6

)%

 

320,215

 

 

422,132

 

(24

)%

Aviation

 

151,112

 

 

187,574

 

(19

)%

 

465,850

 

 

542,316

 

(14

)%

 

 

 

 

 

 

 

 

 

 

 

Gross margin %

60.2

%

60.7

%

 

59.6

%

60.1

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating income %

28.6

%

28.0

%

 

24.1

%

25.2

%

 

 

 

 

 

 

 

 

 

 

 

 

GAAP diluted EPS

$

1.63

 

$

1.19

 

37

%

$

3.44

 

$

3.10

 

11

%

Pro forma diluted EPS(1)

$

1.58

 

$

1.27

 

24

%

$

3.41

 

$

3.16

 

8

%

 

 

 

 

 

 

 

 

 

 

 

(1) See attached Non-GAAP Financial Information for discussion and reconciliation of non-GAAP financial measures, including pro forma diluted EPS

Executive Overview from Cliff Pemble, President and Chief Executive Officer:

“Demand for active lifestyle products fueled strong revenue growth resulting in record revenue and profits for the quarter,” said Cliff Pemble, President and CEO of Garmin. “Interest in our products remains high as we move into the important holiday selling season, and we are prepared with a strong lineup of products that offer the innovation and uniqueness that consumers want.”

Marine:

Revenue from the marine segment grew 54% in the third quarter across multiple categories led by chartplotters. Gross margin and operating margin were 61% and 31%, respectively, resulting in 152% operating income growth. For the sixth consecutive year, Garmin was recognized as the Manufacturer of the Year by the National Marine Electronics Association (NMEA) and was also awarded four Product of Excellence awards. We launched the new OnDeck system, Garmin’s first remote connectivity solution for boaters to track, monitor, and remotely control switches on their vessel from virtually anywhere. We also refreshed our Fantom solid-state marine radar offering industry leading power in the solid-state RADAR market.

Fitness:

Revenue from the fitness segment grew 35% in the third quarter driven by strong demand for our advanced wearables and cycling products. Gross margin and operating margin were 54% and 27%, respectively, resulting in 75% operating income growth. We launched the new Forerunner® 745, adding daily suggested workouts helping competitors reach their goals, and the Garmin Clipboard app that offers an integrated solution for coaches to manage team training and performance. We also launched the Venu® Sq, an entry-level smart watch with GPS capability that combines daily style with industry-leading health monitoring.

Outdoor:

Revenue from the outdoor segment grew 30% in the third quarter across all categories led by strong demand for our adventure watches. Gross margin and operating margin were 67% and 44%, respectively, resulting in 40% operating income growth. We recently refreshed the popular Montana® series, combining the flexibility of on or off-road navigation with global messaging and SOS alerts via inReach® satellite technology.

Auto:

Revenue from the auto segment declined 6% during the third quarter as declines in personal navigation devices were partially offset by growth in specialty categories and new OEM programs. Gross and operating margins were 45% and 3%, respectively. We launched Garmin Catalyst, a new product category and an industry-first real-time coaching tool to help drivers achieve their full potential on the track. We began production shipments of the BMW MGU 2020 computing module expanding our role as a tier-one supplier for BMW automobiles. In addition, we began shipments of a complete infotainment solution for the Daimler Vito vehicle.

Aviation:

Revenue from the aviation segment declined 19% in the third quarter due to fewer shipments to OEM customers and reduced contributions from ADS-B products. Gross margin and operating margin were 71% and 19%, respectively. During the quarter, Autoland achieved FAA certification on the Cirrus Vision Jet, becoming the first jet aircraft to incorporate Autoland technology. This latest certification brings the Autoland equipped aircraft to three models including the previously certified Piper M600 and Daher TBM 940.

Additional Financial Information:

Total operating expenses in the third quarter were $351 million, a 15% increase over the prior year. Research and development increased by 18%, primarily due to engineering personnel costs. Selling, general and administrative expenses increased 14%, driven primarily by information technology costs and personnel related expenses. Advertising increased 4%, driven primarily by higher spend in the outdoor segment.

The effective tax rate in the third quarter of 2020 was 6.9% compared to 11.6% in the prior year quarter. The decrease in the effective tax rate is primarily due to the migration of intellectual property ownership from Switzerland to the United States.

In the third quarter of 2020, we generated approximately $236 million of free cash flow(1), and paid a quarterly dividend of approximately $117 million. We ended the quarter with cash and marketable securities of approximately $2.7 billion.

(1) See attached Non-GAAP Financial Information for discussion and reconciliation of non-GAAP financial measures, including free cash flow.

2020 Guidance (2):

We expect full year 2020 revenue of approximately $4.0 billion with growth in the marine, fitness, and outdoor segments partially offset by declines in the auto and aviation segments. We expect our full year pro forma EPS to be approximately $4.70 based upon gross margin of approximately 59.0%, operating margin of approximately 24.0% and a full year pro forma effective tax rate of approximately 10.0%.

 

 

2020 Guidance

 

Segment

 

2020 Revenue
Growth Estimates

Revenue

 

~$4.0B

 

Marine

 

~25%

Gross Margin

 

~59.0%

 

Fitness

 

~20%

Operating Margin

 

~24.0%

 

Outdoor

 

~15%

Tax Rate

 

~10.0%

 

Aviation

 

~(17%)

EPS

 

~$4.70

 

Auto

 

~(20%)

(2) See attached discussion on Forward-looking Financial Measures

Webcast Information/Forward-Looking Statements:

The information for Garmin Ltd.’s earnings call is as follows:

When:

Wednesday, October 28, 2020 at 10:30 a.m. Eastern

Where:

https://www.garmin.com/en-US/investors/events/

How:

Simply log on to the web at the address above or call to listen in at 855-757-3897

An archive of the live webcast will be available until October 28, 2021 on the Garmin website at www.garmin.com. To access the replay, click on the Investors link and click over to the Events Calendar page.

This release includes projections and other forward-looking statements regarding Garmin Ltd. and its business that are commonly identified by words such as “anticipates,” “would,” “may,” “expects,” “estimates,” “plans,” “intends,” “projects,” and other words or phrases with similar meanings. Any statements regarding the Company’s expected fiscal 2020 GAAP and pro forma estimated earnings, EPS, and effective tax rate, and the Company’s expected segment revenue growth rates, consolidated revenue, gross margins, operating margins, potential future acquisitions, currency movements, expenses, pricing, new products to be introduced, statements relating to possible future dividends, statements related to the ongoing impact of the COVID-19 pandemic, and the Company’s plans and objectives are forward-looking statements. The forward-looking events and circumstances discussed in this release may not occur and actual results could differ materially as a result of risk factors and uncertainties affecting Garmin, including, but not limited to, the risk factors that are described in both the Annual Report on Form 10-K for the year ended December 28, 2019 and the Quarterly Report on Form 10-Q for the quarter ended September 26, 2020 filed by Garmin with the Securities and Exchange Commission (Commission file number 0-31983). A copy of Garmin’s 2019 Form 10-K and the Q3 2020 Form 10-Q can be downloaded from https://www.garmin.com/en-US/investors/sec/. All information provided in this release and in the attachments is as of October 28, 2020. Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to us on the date hereof. We undertake no duty to update this information unless required by law.

This release and the attachments contain non-GAAP financial measures. A reconciliation to the nearest GAAP measure and a discussion of the Company's use of these measures are included in the attachments.

Garmin, the Garmin logo and the Garmin delta, Forerunner, Venu, inReach and Montana are trademarks of Garmin Ltd. or its subsidiaries and are registered in one or more countries, including the U.S. Garmin Catalyst, Fantom, Garmin OnDeck, and Panoptix, are trademarks of Garmin Ltd. or its subsidiaries. All other brands, product names, company names, trademarks and service marks are the properties of their respective owners. All rights reserved

 

Garmin Ltd. And Subsidiaries

Condensed Consolidated Statements of Income (Unaudited)

(In thousands, except per share information)

 

 

 

13-Weeks Ended

 

39-Weeks Ended

 

 

September 26,

 

September 28,

 

September 26,

 

September 28,

 

 

2020

 

2019

 

2020

 

2019

Net sales

$

1,109,194

$

934,383

 

$

2,835,168

 

$

2,655,273

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of goods sold

 

441,211

 

366,925

 

 

1,144,816

 

 

1,060,752

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

667,983

 

567,458

 

 

1,690,352

 

 

1,594,521

 

 

 

 

 

 

 

 

 

 

 

 

 

Advertising expense

 

33,866

 

32,668

 

 

90,031

 

 

101,808

 

Selling, general and administrative expense

 

142,134

 

124,769

 

 

411,335

 

 

380,289

 

Research and development expense

 

174,882

 

148,561

 

 

506,013

 

 

443,361

 

Total operating expense

 

350,882

 

305,998

 

 

1,007,379

 

 

925,458

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

317,101

 

261,460

 

 

682,973

 

 

669,063

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

7,777

 

12,309

 

 

30,258

 

 

39,748

 

Foreign currency gains (losses)

 

10,113

 

(16,296

)

 

(9,802

)

 

(12,568

)

Other income (expense)

 

1,726

 

294

 

 

8,515

 

 

3,567

 

Total other income (expense)

 

19,616

 

(3,693

)

 

28,971

 

 

30,747

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

336,717

 

257,767

 

 

711,944

 

 

699,810

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax provision

 

23,300

 

29,901

 

 

53,168

 

 

108,115

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

313,417

$

227,866

 

$

658,776

 

$

591,695

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share:

 

 

 

 

 

 

 

 

 

 

 

Basic

$

1.64

$

1.20

 

$

3.45

 

$

3.12

 

Diluted

$

1.63

$

1.19

 

$

3.44

 

$

3.10

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

191,234

 

190,102

 

 

191,021

 

 

189,853

 

Diluted

 

191,998

 

190,962

 

 

191,760

 

 

190,790

 

 

Garmin Ltd. And Subsidiaries

Condensed Consolidated Balance Sheets (Unaudited)

(In thousands, except per share information)

 

 

September 26
2020

December 28
2019

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

$

1,223,516

 

$

1,027,567

 

Marketable securities

 

430,164

 

 

376,463

 

Accounts receivable, net

 

658,000

 

 

706,763

 

Inventories

 

821,377

 

 

752,908

 

Deferred costs

 

21,067

 

 

25,105

 

Prepaid expenses and other current assets

 

187,746

 

 

169,044

 

Total current assets

 

3,341,870

 

 

3,057,850

 

 

 

 

 

 

 

 

Property and equipment, net

 

813,561

 

 

728,921

 

Operating lease right-of-use assets

 

74,949

 

 

63,589

 

 

 

 

 

 

 

 

Restricted cash

 

293

 

 

71

 

Marketable securities

 

1,058,103

 

 

1,205,475

 

Deferred income taxes

 

247,502

 

 

268,518

 

Noncurrent deferred costs

 

17,676

 

 

23,493

 

Intangible assets, net

 

818,781

 

 

659,629

 

Other assets

 

177,934

 

 

159,253

 

Total assets

$

6,550,669

 

$

6,166,799

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

$

235,467

 

$

240,831

 

Salaries and benefits payable

 

137,859

 

 

128,426

 

Accrued warranty costs

 

40,002

 

 

39,758

 

Accrued sales program costs

 

76,255

 

 

112,578

 

Deferred revenue

 

88,042

 

 

94,562

 

Accrued royalty costs

 

15,389

 

 

15,401

 

Accrued advertising expense

 

25,905

 

 

35,142

 

Other accrued expenses

 

105,731

 

 

95,060

 

Income taxes payable

 

48,342

 

 

56,913

 

Dividend payable

 

349,964

 

 

217,262

 

Total current liabilities

 

1,122,956

 

 

1,035,933

 

 

 

 

 

 

 

 

Deferred income taxes

 

124,746

 

 

114,754

 

Noncurrent income taxes

 

75,186

 

 

105,771

 

Noncurrent deferred revenue

 

52,715

 

 

67,329

 

Noncurrent operating lease liabilities

 

58,416

 

 

49,238

 

Other liabilities

 

12,309

 

 

278

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Shares, CHF 0.10 par value, 198,077 shares authorized and issued; 191,237
shares outstanding at September 26, 2020 and 190,686 shares outstanding
at December 28, 2019

 

17,979

 

 

17,979

 

Additional paid-in capital

 

1,872,519

 

 

1,835,622

 

Treasury stock

 

(326,294

)

 

(345,040

)

Retained earnings

 

3,421,159

 

 

3,229,061

 

Accumulated other comprehensive income

 

118,978

 

 

55,874

 

Total stockholders’ equity

 

5,104,341

 

 

4,793,496

 

Total liabilities and stockholders’ equity

$

6,550,669

 

$

6,166,799

 

 

Garmin Ltd. And Subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited)

(In thousands)

 

 

 

39-Weeks Ended

 

 

September 26,
2020

 

September 28,
2019

Operating Activities:

 

 

 

 

 

 

Net income

$

658,776

 

$

591,695

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

Depreciation

 

57,141

 

 

52,503

 

Amortization

 

32,969

 

 

25,112

 

Gain on sale of property and equipment

 

(1,815

)

 

(5

)

Unrealized foreign currency losses

 

4,384

 

 

14,653

 

Deferred income taxes

 

14,353

 

 

18,012

 

Stock compensation expense

 

53,515

 

 

47,553

 

Realized gain on marketable securities

 

(1,316

)

 

(213

)

Changes in operating assets and liabilities, net of acquisitions:

 

 

 

 

 

 

Accounts receivable, net of allowance for doubtful accounts

 

59,474

 

 

15,244

 

Inventories

 

(56,063

)

 

(178,121

)

Other current and non-current assets

 

(27,019

)

 

(86,538

)

Accounts payable

 

(11,939

)

 

27,523

 

Other current and non-current liabilities

 

(18,299

)

 

(54,401

)

Deferred revenue

 

(21,148

)

 

(7,750

)

Deferred costs

 

9,855

 

 

6,326

 

Income taxes payable

 

(53,419

)

 

(7,423

)

Net cash provided by operating activities

 

699,449

 

 

464,170

 

 

 

 

 

 

 

 

Investing activities:

 

 

 

 

 

 

Purchases of property and equipment

 

(137,072

)

 

(91,469

)

Proceeds from sale of property and equipment

 

1,965

 

 

370

 

Purchase of intangible assets

 

(1,643

)

 

(1,862

)

Purchase of marketable securities

 

(702,487

)

 

(333,320

)

Redemption of marketable securities

 

808,554

 

 

333,783

 

Acquisitions, net of cash acquired

 

(148,648

)

 

(275,310

)

Net cash used in investing activities

 

(179,331

)

 

(367,808

)

 

 

 

 

 

 

 

Financing activities:

 

 

 

 

 

 

Dividends

 

(333,975

)

 

(308,905

)

Proceeds from issuance of treasury stock related to equity awards

 

15,202

 

 

12,982

 

Purchase of treasury stock related to equity awards

 

(13,074

)

 

(12,972

)

Net cash used in financing activities

 

(331,847

)

 

(308,895

)

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

7,900

 

 

(11,834

)

 

 

 

 

 

 

 

Net increase (decrease) in cash, cash equivalents, and restricted cash

 

196,171

 

 

(224,367

)

Cash, cash equivalents, and restricted cash at beginning of period

 

1,027,638

 

 

1,201,805

 

Cash, cash equivalents, and restricted cash at end of period

$

1,223,809

 

$

977,438

 

 

Garmin Ltd. And Subsidiaries

Net Sales, Gross Profit and Operating Income by Segment (Unaudited)

(In thousands)

 

 

 

Reportable Segments

 

 

Marine

 

Fitness

 

Outdoor

 

Auto

 

Aviation

 

Total

13-Weeks Ended September 26, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

165,437

$

328,446

$

334,844

$

129,355

 

$

151,112

$

1,109,194

Gross profit

 

100,423

 

177,794

 

223,704

 

58,135

 

 

107,927

 

667,983

Operating income

 

50,482

 

87,083

 

147,477

 

3,462

 

 

28,597

 

317,101

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13-Weeks Ended September 28, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

107,694

$

243,099

$

258,294

$

137,722

 

$

187,574

$

934,383

Gross profit

 

64,275

 

126,835

 

170,846

 

65,814

 

 

139,688

 

567,458

Operating income

 

20,008

 

49,831

 

105,051

 

20,857

 

 

65,713

 

261,460

 

 

 

 

 

 

 

 

 

 

 

 

 

 

39-Weeks Ended September 26, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

486,269

$

846,688

$

716,146

$

320,215

 

$

465,850

$

2,835,168

Gross profit

 

288,103

 

446,936

 

469,150

 

147,393

 

 

338,770

 

1,690,352

Operating income

 

134,195

 

190,075

 

262,057

 

(6,837

)

 

103,483

 

682,973

 

 

 

 

 

 

 

 

 

 

 

 

 

 

39-Weeks Ended September 28, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

393,070

$

675,007

$

622,748

$

422,132

 

$

542,316

$

2,655,273

Gross profit

 

234,014

 

352,805

 

403,842

 

198,012

 

 

405,848

 

1,594,521

Operating income

 

88,212

 

118,369

 

218,340

 

53,978

 

 

190,164

 

669,063

 

Garmin Ltd. And Subsidiaries

Net Sales by Geography (Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

13-Weeks Ended

 

39-Weeks Ended

 

September 26,

 

September 28,

 

YoY

 

September 26,

 

September 28,

 

YoY

 

2020

 

2019

 

Change

 

2020

 

2019

 

Change

Net sales

$

1,109,194

$

934,383

19

%

$

2,835,168

$

2,655,273

7

%

Americas

 

521,869

 

439,113

19

%

 

1,372,360

 

1,289,409

6

%

EMEA

 

407,859

 

344,010

19

%

 

1,042,928

 

942,625

11

%

APAC

 

179,466

 

151,260

19

%

 

419,880

 

423,239

(1

)%

 

 

 

 

 

 

 

 

 

 

 

EMEA - Europe, Middle East and Africa; APAC - Asia Pacific and Australian Continent

Non-GAAP Financial Information

To supplement our financial results presented in accordance with GAAP, this release includes the following measures defined by the Securities and Exchange Commission as non-GAAP financial measures: pro forma net income (earnings) per share, pro forma effective tax rate and free cash flow. These non-GAAP measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may be different from non-GAAP measures used by other companies, limiting the usefulness of the measures for comparison with other companies. Management believes providing investors with an operating view consistent with how it manages the Company provides enhanced transparency into the operating results of the Company, as described in more detail by category below.

The tables below provide reconciliations between the GAAP and non-GAAP measures.

Pro forma effective tax rate

The Company’s income tax expense is periodically impacted by discrete tax items that are not reflective of income tax expense incurred as a result of current period earnings. Therefore, management believes disclosure of the effective tax rate and income tax provision before the effect of certain discrete tax items are important measures to permit investors' consistent comparison between periods. In the first 39 weeks of 2019, there were no such discrete tax items identified.

Garmin Ltd. And Subsidiaries

Pro Forma Effective Tax Rate

(In thousands, except effective tax rate (ETR) information)

 

 

 

13-Weeks Ended

 

39-Weeks Ended

 

 

September 26,

 

September 26,

 

 

2020

 

2020

 

 

$

 

ETR(1)

 

$

 

ETR(1)

U.S GAAP income tax provision

$

23,300

6.9

%

$

53,168

7.5

%

Pro forma discrete tax item:

 

 

 

 

 

 

 

 

Uncertain Tax Reserve Release(2)

 

 

 

 

 

14,308

 

 

Pro forma income tax provision

$

23,300

6.9

%

$

67,476

9.5

%

(1) Effective tax rate is calculated by taking the income tax provision divided by income before taxes, as presented on the face of the Condensed Consolidated Statements of Income.

(2) In second quarter 2020, the Company recognized a $14.3 million income tax benefit due to the release of uncertain tax position reserves associated with the 2014 intercompany restructuring, which was a pro forma adjustment in 2014. The second quarter 2020 impact of the reserve release is not reflective of income tax expense incurred as a result of current period earnings and therefore affects period-to-period comparability.

The net release of other uncertain tax position reserves, amounting to approximately $22.9 million and $23.3 million in the 39 weeks ended September 26, 2020 and September 28, 2019, respectively, have not been identified as pro forma adjustments as such items tend to be more recurring in nature.

Pro forma net income (earnings) per share

Management believes that net income (earnings) per share before the impact of foreign currency gains or losses and certain discrete income tax items, as discussed above, is an important measure in order to permit a consistent comparison of the Company’s performance between periods.

Garmin Ltd. And Subsidiaries

Pro Forma Net Income (Earnings) Per Share

(In thousands, except per share information)

 

 

 

13-Weeks Ended

 

39-Weeks Ended

 

 

September 26,

 

September 28,

 

September 26,

 

September 28,

 

 

2020

 

2019

 

2020

 

2019

GAAP net income

$

313,417

 

$

227,866

 

$

658,776

 

$

591,695

 

Foreign currency gains / losses(1)

 

(10,113

)

 

16,296

 

 

9,802

 

 

12,568

 

Tax effect of foreign currency gains / losses(2)

 

700

 

 

(1,890

)

 

(929

)

 

(1,942

)

Pro forma discrete tax item(3)

 

 

 

 

 

(14,308

)

 

 

Pro forma net income

$

304,004

 

$

242,272

 

$

653,341

 

$

602,321

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

1.64

 

$

1.20

 

$

3.45

 

$

3.12

 

Diluted

$

1.63

 

$

1.19

 

$

3.44

 

$

3.10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pro forma net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

1.59

 

$

1.27

 

$

3.42

 

$

3.17

 

Diluted

$

1.58

 

$

1.27

 

$

3.41

 

$

3.16

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

191,234

 

 

190,102

 

 

191,021

 

 

189,853

 

Diluted

 

191,998

 

 

190,962

 

 

191,760

 

 

190,790

 

(1) Foreign currency gains and losses for the Company are driven by movements of a number of currencies in relation to the U.S. Dollar and the related exchange rate impact on the significant cash, receivables, and payables held in a currency other than the functional currency at a given legal entity. However, there is minimal cash impact from such foreign currency gains and losses.

(2) The tax effect of foreign currency gains and losses was calculated using the pro forma effective tax rate of 6.9% and 9.5% for the 13-weeks and 39-weeks ended September 26, 2020, respectively, and an effective tax rate of 11.6% and 15.4% for the 13-weeks and 39-weeks ended September 28, 2019, respectively.

(3) The discrete tax item is discussed in the pro forma effective tax rate section above.

Free cash flow

Management believes that free cash flow is an important financial measure because it represents the amount of cash provided by operations that is available for investing and defines it as operating cash flows less capital expenditures for property and equipment.


Contacts

Investor Relations Contact:
Teri Seck
913/397-8200
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Media Relations Contact:
Carly Hysell
913/397-8200
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Read full story here

BILBAO, Spain & NEW YORK--(BUSINESS WIRE)--Accenture (NYSE: ACN) is helping Siemens Gamesa, a global leader in renewable energy, develop and implement a cloud-based state-of-the-art human resources (HR) solution to streamline its HR operations, reduce operating costs and improve the employee experience.


Created from the 2017 merger of Siemens Wind and Gamesa, Siemens Gamesa is one of the world’s largest wind-turbine manufacturers and a leading provider of related services.

As part of its work, Accenture is consolidating Siemens Gamesa’s multiple HR functions and capabilities to create a single integrated HR platform that spans the full employee lifecycle, from recruiting and onboarding to workforce administration, compensation and benefits, pre-payroll activities and performance management.

The solution will integrate a variety of technology tools, including Avature for candidate relationship management and Harqen, a recruiting tool for facilitating video interviews. Accenture will operate and maintain the new platform as part of a multi-year agreement.

“We are transforming, standardizing and digitizing our HR processes while consolidating them into a single, unified global platform,” said Javier Fernandez-Combarro, Siemens Gamesa’s human resources director. “The program will help us drive consistency and efficiency in our HR operations — providing a better employee experience and increased service levels.”

Eric Schaeffer, a senior managing director at Accenture who leads its Industrial practice globally, said, “Siemens Gamesa understands the value that high-quality streamlined HR services can provide to its workforce and its bottom line.”

Patrick Vollmer, a managing director at Accenture who leads its Industrial Equipment practice in Austria, Switzerland, Germany and Russia and serves as global client account lead for Siemens Gamesa, added, “We are excited to work with Siemens Gamesa on this critical project to transform their HR capabilities and services, which are helping them become more efficient and differentiated in terms of their recruitment efforts.”

Accenture’s Industrial Equipment practice — fuelled by the company’s global industrial footprint, ecosystem and cross functional expertise — helps clients re-tool, re-purpose and re-invent themselves in the ever-changing business environment so that they are future-ready and prepared for the Industrial Renaissance. To learn more, visit https://www.accenture.com/us-en/industries/industrial-equipment-index.

About Accenture

Accenture is a global professional services company with leading capabilities in digital, cloud and security. Combining unmatched experience and specialized skills across more than 40 industries, we offer Strategy and Consulting, Interactive, Technology and Operations services—all powered by the world’s largest network of Advanced Technology and Intelligent Operations centers. Our 506,000 people deliver on the promise of technology and human ingenuity every day, serving clients in more than 120 countries. We embrace the power of change to create value and shared success for our clients, people, shareholders, partners and communities. Visit us at www.accenture.com.

Copyright© 2020 Accenture. All rights reserved. Accenture and its logo are trademarks of Accenture.


Contacts

Youssef Zauaghi
Accenture
+49 175 5766458
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DUBLIN--(BUSINESS WIRE)--The "The Angolan Petroleum Industry 2020" report has been added to ResearchAndMarkets.com's offering.


This report focuses on the petroleum sector in Angola and includes comprehensive information on the country, its upstream and downstream oil sectors, developments and corporate actions and factors that influence the sector.

The Petroleum Sector in Angola:

Angola's oil sector accounted for 29.4% of the country's GDP in the fourth quarter of 2019 and it employs only about 1% of the country's workforce. While oil remains Angola's key export, oil production has been in decline since the oil price slump started in 2014. Since March 2020, when the country was hit hard by the coronavirus pandemic, the outlook for Africa's second largest oil producer has worsened. Despite being a leading oil producer, Angola imports refined oil for its own energy needs. The Angolan government has plans to construct several national refineries to increase its refinery capacity.

Government Plans:

Before the Angolan government announced emergency measures to tackle coronavirus, the Angolan National Petroleum and Gas Agency had revealed plans to auction 50 new oil and gas blocks between 2019 and 2025, and the first 10 were auctioned in 2019.

The government has liberalised regulations in the downstream sector and aims to increase refining and land-based storage capacity, encourage the construction of new gas stations and review and possibly liberalise the regulatory regime in logistics and derivatives distribution. The government's plan to sell state-owned Sonangol's assets, including equity stakes in various private entities, might enable new players to enter the market more easily.

There are profiles of nine companies including the four multinational operators that dominate the oil exploration and production market, Total, Chevron, ExxonMobil and BP. Other profiles include Sonangol, and smaller players such as Pumagol and Norwegian oil company Equinor, which is involved in the country through partnerships with other operators, including Sonangol.

Key Topics Covered:

1. Introduction

2. Country Information

3. Description of the Industry

3.1. Geographic Position

4. Size of the Industry

5. State of the Industry

5.1. Local

5.1.1. Regulations

5.1.2. Enterprise Development and Social Economic Development

5.2. Continental

5.3. International

6. Influencing Factors

6.1. Government Support

6.2. Economic Environment

6.3. Technology, Research and Development (R&D) and Innovation

6.4. Labour

6.5. Social Projects

6.6. Environmental Impact

6.7. Marketing

7. Competition

7.1. Barriers to Entry

8. SWOT Analysis

9. Outlook

10. Industry Associations

11. References

Summary of Notable Players

Company Profiles

  • Bp plc
  • Chevron Corporation
  • Eni Spa
  • Equinor Asa
  • Exxon Mobil Corporation
  • Galp Energia Sgps S.A.
  • Pumangol Lda
  • Sociedade Nacional De Combustiveis De Angola E.P.
  • Total E&P Angola

For more information about this report visit https://www.researchandmarkets.com/r/4eh3i4


Contacts

ResearchAndMarkets.com
Laura Wood, Senior Press Manager
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For E.S.T Office Hours Call 1-917-300-0470
For U.S./CAN Toll Free Call 1-800-526-8630
For GMT Office Hours Call +353-1-416-8900

DUBLIN--(BUSINESS WIRE)--The "Global LPG Market Analysis Plant Capacity, Production, Operating Efficiency, Demand & Supply, End User Industries, Distribution Channel, Regional Demand, 2015-2030" report has been added to ResearchAndMarkets.com's offering.


Global LPG demand stood at 280 million tonnes in 2019 and is anticipated to grow at around CAGR 7.15% during the forecast period

LPG is versatile fuel used across plethora of applications. Due to its high calorific value, LPG is the most commonly used fuel across the residential households for heating and cooking purposes. However, there are also other non-residential uses, such as transportation, commercial and industrial heating, and other non-fuel applications such as petrochemicals production. Due to its ease of transport and affordability, Asia and Middle East LPG hold the largest market potential for LPG adoption across several industries.

Under this subscription you would be able to access global LPG market demand and supply analysis on a cloud-based platform for one year. The data is updated on near real time basis to add any new movement in the industry including but not limited to new plant announcement, plant shutdowns, temporary disruptions in demand or supply, news and deals and much more specific to LPG.

Deliverables

  • Production Capacity By Company: Production Capacity at global level along with individual capacity of leading players
  • Production By Company: Actual production done by different companies
  • Operating Efficiency By Company: Operating Efficiency at which different companies are operating their plants
  • Demand By End Use: Demand/Sale of LPG in different end user industries
  • Demand By Sales Channel: Demand/Sale of LPG by different sales channels
  • Demand By Region: Demand/Sale of LPG in different regions like North America, South America, Europe, Asia, Middle East & Africa
  • Demand & Supply Gap: Demand & Supply Gap at global level
  • Market Share of Leading Players: Revenue shares of leading players
  • News & Deals: Historical & Current News & Deals in LPG market

Years Considered for Analysis:

  • Historical Years: 2015 - 2018
  • Base Year: 2019
  • Estimated Year: 2020
  • Forecast Period: 2021 - 2030

For more information about this report visit https://www.researchandmarkets.com/r/b1fb0k


Contacts

ResearchAndMarkets.com
Laura Wood, Senior Press Manager
This email address is being protected from spambots. You need JavaScript enabled to view it.
For E.S.T Office Hours Call 1-917-300-0470
For U.S./CAN Toll Free Call 1-800-526-8630
For GMT Office Hours Call +353-1-416-8900

Key Developments:


  • Increased the estimate of gross discovered recoverable resources to approximately 9 billion barrels of oil equivalent (boe) for the Stabroek Block (Hess – 30%), offshore Guyana; announced oil discoveries at the Yellowtail-2 and Redtail-1 wells in September, bringing total discoveries on the Block to 18
  • Sanctioned development of Payara, the third oil development on the Stabroek Block, which will have the capacity to produce up to 220,000 gross barrels of oil per day (bopd); first oil is expected in 2024
  • Agreed to sell the Corporation's 28% working interest in the Shenzi Field in the deepwater Gulf of Mexico for total consideration of $505 million, with an effective date of July 1, 2020; the sale is expected to close prior to year-end

Third Quarter Financial and Operational Highlights:

  • Net loss was $243 million, or $0.80 per common share, compared with a net loss of $212 million, or $0.70 per common share in the third quarter of 2019
  • Adjusted net loss1 was $216 million, or $0.71 per common share, compared with an adjusted net loss of $105 million, or $0.35 per common share in the prior-year quarter
  • Oil and gas net production, excluding Libya, averaged 321,000 barrels of oil equivalent per day (boepd), up from 290,000 boepd in the third quarter of 2019; Bakken net production was 198,000 boepd, up 21% from 163,000 boepd in the prior-year quarter
  • Crude oil put option contracts are in place for more than 80% of forecast net oil production for the remainder of 2020 with a fair value of approximately $205 million at September 30, 2020; realized settlements on crude oil put option contracts during the first nine months of 2020 were approximately $700 million
  • E&P capital and exploratory expenditures were $331 million, compared with $661 million in the prior-year quarter
  • Cash and cash equivalents, excluding Midstream, were $1.28 billion at September 30, 2020

2020 Updated Full Year Guidance:

  • Net production, excluding Libya, is expected to be approximately 325,000 boepd, down from previous guidance of approximately 330,000 boepd primarily due to hurricane-related downtime in the Gulf of Mexico
  • Bakken net production is expected to be approximately 190,000 boepd, up from the previous guidance of approximately 185,000 boepd due to strong year to date performance
  • E&P capital and exploratory expenditures are projected to be approximately $1.8 billion, down from previous guidance of approximately $1.9 billion
  1. “Adjusted net income (loss)” is a non-GAAP financial measure. The definition of this non-GAAP measure and a reconciliation to its nearest GAAP equivalent measure appears on pages 7 to 9.

NEW YORK--(BUSINESS WIRE)--Hess Corporation (NYSE: HES) today reported a net loss of $243 million, or $0.80 per common share, in the third quarter of 2020, compared with a net loss of $212 million, or $0.70 per common share, in the third quarter of 2019. On an adjusted basis, the Corporation reported a net loss of $216 million, or $0.71 per common share, in the third quarter of 2020, compared with an adjusted net loss of $105 million, or $0.35 per common share, in the prior-year quarter. The decrease in adjusted after-tax results compared with the prior-year period primarily reflects lower realized selling prices and higher exploration expenses.

     “We continue to execute our strategy and achieve strong operational performance while prioritizing the preservation of cash, capability and the long term value of our assets during this low price environment,” CEO John Hess said. “Our differentiated portfolio of assets, including multiple phases of low cost Guyana oil developments, positions us to deliver industry leading cash flow growth and drive our company’s breakeven price to under $40 per barrel Brent by mid decade.”

      After-tax income (loss) by major operating activity was as follows:

 

Three Months Ended
September 30,
(unaudited)

 

Nine Months Ended
September 30,
(unaudited)

 

2020

 

2019

 

2020

 

2019

 

(In millions, except per share amounts)

Net Income (Loss) Attributable to Hess Corporation

 

 

 

 

Exploration and Production

$

(182)

 

 

$

(60)

 

 

$

(2,802)

 

 

$

117

 

Midstream

56

 

 

39

 

 

168

 

 

111

 

Corporate, Interest and Other

(117)

 

 

(191)

 

 

(362)

 

 

(414)

 

Net income (loss) attributable to Hess Corporation

$

(243)

 

 

$

(212)

 

 

$

(2,996)

 

 

$

(186)

 

Net income (loss) per common share (diluted) (a)

$

(0.80)

 

 

$

(0.70)

 

 

$

(9.83)

 

 

$

(0.63)

 

Adjusted Net Income (Loss) Attributable to Hess Corporation

 

 

 

 

Exploration and Production

$

(156)

 

 

$

(41)

 

 

$

(525)

 

 

$

114

 

Midstream

56

 

 

39

 

 

168

 

 

111

 

Corporate, Interest and Other

(116)

 

 

(103)

 

 

(361)

 

 

(326)

 

Adjusted net income (loss) attributable to Hess Corporation

$

(216)

 

 

$

(105)

 

 

$

(718)

 

 

$

(101)

 

Adjusted net income (loss) per common share (diluted) (a)

$

(0.71)

 

 

$

(0.35)

 

 

$

(2.36)

 

 

$

(0.35)

 

 

 

 

 

 

 

 

 

Weighted average number of shares (diluted)

305.0

 

 

302.5

 

 

304.7

 

 

300.7

 

(a) Calculated as net income (loss) attributable to Hess Corporation less preferred stock dividends, divided by weighted average number of diluted shares.

Exploration and Production:

      E&P net loss was $182 million in the third quarter of 2020, compared with a net loss of $60 million in the third quarter of 2019. On an adjusted basis, E&P's third quarter 2020 net loss was $156 million, compared with an adjusted net loss of $41 million in the prior-year quarter. The Corporation’s average realized crude oil selling price, excluding the effect of hedging, was $36.17 per barrel in the third quarter of 2020, compared with $55.91 per barrel in the prior-year quarter, reflecting a decrease in benchmark oil prices and widening of crude differentials realized as a result of reduced demand caused by the global coronavirus (COVID-19) pandemic. Realized gains from crude oil hedging activities improved after-tax results by $143 million in the third quarter of 2020 and $2 million in the third quarter of 2019. Including hedging, the Corporation’s average realized crude oil selling price was $45.60 per barrel in the third quarter of 2020, compared with $56.03 per barrel in the year-ago quarter. The average realized natural gas liquids (NGL) selling price in the third quarter of 2020 was $11.63 per barrel, compared with $9.41 per barrel in the prior-year quarter, while the average realized natural gas selling price was $2.94 per mcf, compared with $3.81 per mcf in the third quarter of 2019.

      Net production, excluding Libya, was 321,000 boepd in the third quarter of 2020, up 11% from third quarter 2019 net production of 290,000 boepd. The improved performance primarily resulted from a 21% increase in Bakken production and production from the Liza Field, offshore Guyana, which commenced in December 2019, partially offset by hurricane-related downtime in the Gulf of Mexico and lower production in South East Asia. There was no net production for Libya in the third quarter of 2020 due to the declaration of force majeure by the Libyan National Oil Corporation. Net production for Libya was 22,000 boepd in the third quarter of 2019.

      Cash operating costs, which include operating costs and expenses, production and severance taxes, and E&P general and administrative expenses, were $9.86 per boe excluding items affecting comparability of earnings between periods in the third quarter of 2020, down 19% from $12.13 per boe in the prior-year quarter due to the increased production volumes, lower production and severance taxes and the impact of cost-reduction initiatives.

Operational Highlights for the Third Quarter of 2020:

      Bakken (Onshore U.S.): Net production from the Bakken increased to 198,000 boepd from 163,000 boepd in the prior-year quarter, with net oil production up 13% to 108,000 bopd from 96,000 bopd, primarily due to increased wells online and improved well performance. Natural gas and NGL production also increased from higher wells online, additional natural gas captured and processed, and approximately 6,000 boepd of additional volumes received under percentage of proceeds contracts resulting from lower prices. The Corporation operated one rig in the third quarter, drilled 6 wells, completed 13 wells, and brought 22 new wells online.

      As previously announced in the second quarter, the Corporation chartered three very large crude carriers (VLCCs) to load a total of approximately 6 million barrels of oil in the second and third quarters for sale in Asian markets to enhance cash flow and maximize value from its Bakken production. The first VLCC cargo of 2.1 million barrels was sold in China in September with cash proceeds received in October.

      Gulf of Mexico (Offshore U.S.): Net production from the Gulf of Mexico was 49,000 boepd, compared with 59,000 boepd in the prior-year quarter reflecting hurricane-related downtime as well as higher planned maintenance. The Esox-1 well, which commenced production in February, reached its gross peak rate of approximately 17,000 boepd, or 9,000 boepd, net to Hess in the third quarter.

       In October, the Corporation entered into an agreement to sell it's 28% working interest in the Shenzi Field for total consideration of $505 million, subject to customary adjustments, with an effective date of July 1, 2020. Hess’ net share of production from the Shenzi Field during the first nine months of 2020 was 11,000 boepd. The sale is expected to close during the fourth quarter of 2020 and is subject to customary closing conditions.

      The BP operated Galapagos Deep well (Hess – 25%) in the Mississippi Canyon area of the deepwater Gulf of Mexico was not a commercial success and third quarter results include exploration expenses of $37 million, primarily for well costs incurred through September 30, 2020.

      Guyana (Offshore): At the Stabroek Block (Hess – 30%), the Corporation’s net production from the Liza Field, which commenced in December 2019, averaged 19,000 bopd in the third quarter of 2020. During the third quarter, the operator Esso Exploration and Production Guyana Limited continued work to complete the commissioning of the natural gas injection system that should enable the Liza Destiny floating production, storage and offloading vessel (FPSO) to reach its capacity of 120,000 gross bopd in the fourth quarter. Phase 2 of the Liza Field development, which will utilize the Liza Unity FPSO with an expected capacity of 220,000 gross bopd, remains on target to achieve first oil by early 2022.

     The Corporation announced it had made the final investment decision to proceed with development of the Payara Field on the Stabroek Block after the development plan received approval from the government of Guyana. Payara will utilize the Prosperity FPSO, which will have the capacity to produce up to 220,000 gross bopd and will target an estimated resource base of approximately 600 million barrels of oil. First oil is expected in 2024. Ten drill centers are planned with a total of 41 wells, including 20 production wells and 21 injection wells. Excluding pre-sanction costs and FPSO purchase cost, the Corporation’s net share of development costs is forecast to be approximately $1.8 billion.

      At the Stabroek Block, the operator announced discoveries at the Yellowtail-2 and Redtail-1 exploration wells. Yellowtail-2, the 17 th discovery on the Block, encountered approximately 69 feet of high quality oil bearing reservoirs adjacent to and below the Yellowtail-1 discovery. Redtail-1, the 18 th discovery on the Block, encountered approximately 232 feet of high quality oil bearing sandstone and is located 1.5 miles northwest of the Yellowtail discovery. The estimate of gross discovered recoverable resources on the Block has been increased to approximately 9 billion boe.

      Following the completion of appraisal work at the Yellowtail-2 well, the Stena Carron drillship began drilling the Tanager-1 well on the Kaieteur Block, located 46 miles northwest of Liza in August. Tanager-1 drilling operations are ongoing. The Noble Don Taylor drillship completed the drilling of the Redtail-1 well, and is currently drilling and completing Liza Phase 2 development wells. The other two drillships, the Noble Bob Douglas and the Noble Tom Madden, are drilling and completing Liza Phase 1 and Phase 2 development wells.

     South East Asia (Offshore): Net production at the North Malay Basin and JDA was 50,000 boepd, compared with 60,000 boepd in the prior-year quarter, reflecting COVID-19 impacts on economic activity in Malaysia which reduced natural gas nominations.

Midstream:

      The Midstream segment had net income of $56 million in the third quarter of 2020, compared with net income of $39 million in the prior-year quarter. The improved third quarter 2020 results were primarily driven by higher throughput volumes.

Corporate, Interest and Other:

     After-tax expense for Corporate, Interest and Other was $117 million in the third quarter of 2020, compared with $191 million in the third quarter of 2019. On an adjusted basis, after-tax expense for Corporate, Interest and Other was $116 million in the third quarter of 2020 compared with $103 million in the year-ago quarter. Interest expense increased $18 million compared with the prior-year quarter due to interest on the Corporation's $1.0 billion three year term loan entered into in March 2020 and a decrease in capitalized interest of $11 million.

Capital and Exploratory Expenditures:

     E&P capital and exploratory expenditures were $331 million in the third quarter of 2020, down from $661 million in the prior-year quarter. The decrease is primarily driven by the lower rig count in the Bakken and reduced development drilling in the Gulf of Mexico during the third quarter of 2020. For full year 2020, E&P capital and exploratory expenditures are expected to be approximately $1.8 billion which is down from prior guidance of approximately $1.9 billion. Midstream capital expenditures were $66 million in the third quarter of 2020, down from $112 million in the prior-year quarter.

Liquidity:

     Excluding the Midstream segment, Hess Corporation had cash and cash equivalents of $1.28 billion and debt and finance lease obligations totaling $6.6 billion at September 30, 2020. The Corporation’s debt to capitalization ratio as defined in its debt covenants was 45.7% at September 30, 2020 and 39.6% at December 31, 2019. At September 30, 2020, the fair value of crude oil put option hedge contracts, which cover more than 80% of the Corporation’s forecasted oil production for the remainder of 2020, was approximately $205 million. Realized settlements on closed contracts during the first nine months of 2020 were approximately $700 million. Proceeds from the sale of the first VLCC cargo of 2.1 million barrels of oil was received in October and proceeds from the sale of the second and third VLCC cargos totaling 4.2 million barrels of oil are expected in the first quarter of 2021. The Corporation expects to receive proceeds in the fourth quarter from the sale of its working interest in the Shenzi Field for total consideration of $505 million based on an effective date of July 1, 2020.

      The Midstream segment had cash and cash equivalents of $4 million and total debt of $1.9 billion at September 30, 2020.

     Net cash provided by operating activities was $136 million in the third quarter of 2020, down from $443 million in the third quarter of 2019 primarily due to lower realized crude oil selling prices, the impact on cash flows from deferring sales for 2.6 million barrels of oil loaded on VLCCs in the third quarter, and receipt of cash proceeds from the sale of the first VLCC cargo occurring in October. Net cash provided by operating activities before changes in operating assets and liabilities 2 was $468 million in the third quarter of 2020, compared with $522 million in the prior-year quarter. Changes in operating assets and liabilities during the third quarter of 2020 decreased cash flow from operating activities by $332 million, primarily due to a reduction in payables reflecting reduced operating activity levels and the temporary increase in accounts receivable and inventory resulting from our VLCC transactions which will reverse over the next two quarters, compared with a net cash outflow of $79 million in the third quarter of 2019.

2.

Net cash provided by (used in) operating activities before changes in operating assets and liabilities” is a non-GAAP financial measure. The definition of this non-GAAP measure and a reconciliation to its nearest GAAP equivalent measure appears on pages 8 and 9.

Items Affecting Comparability of Earnings Between Periods:

     The following table reflects the total after-tax income (expense) of items affecting comparability of earnings between periods:

 

Three Months Ended
September 30,
(unaudited)

 

Nine Months Ended
September 30,
(unaudited)

 

2020

 

2019

 

2020

 

2019

 

(In millions)

Exploration and Production

$

(26)

 

 

$

(19)

 

 

$

(2,277)

 

 

$

3

 

Midstream

 

 

 

 

 

 

 

Corporate, Interest and Other

(1)

 

 

(88)

 

 

(1)

 

 

(88)

 

Total items affecting comparability of earnings between periods

$

(27)

 

 

$

(107)

 

 

$

(2,278)

 

 

$

(85)

 

     Third Quarter 2020: Third quarter results included a pre-tax charge for severance of $27 million ($27 million after income taxes) related to cost reduction initiatives. The pre-tax amounts are reported in Operating costs and expenses ($20 million), General and administrative expenses ($6 million), and Exploration expenses ($1 million).

     Third Quarter 2019: Corporate, Interest & Other included a noncash charge to recognize unamortized pension actuarial losses of $88 million ($88 million after income taxes) resulting from the purchase of a single premium annuity contract using funds of the pension plan to settle a portion of the plan’s benefit obligations. The charge is included in Other, net nonoperating income in the income statement. E&P results included a pre-tax charge of $21 million ($19 million after income taxes) related to a settlement on historical cost recovery balances in the JDA and is included in Marketing, including purchased oil and gas in the income statement.

Reconciliation of U.S. GAAP to Non-GAAP measures:

      The following table reconciles reported net income (loss) attributable to Hess Corporation and adjusted net income (loss):

 

Three Months Ended
September 30,
(unaudited)

 

Nine Months Ended
September 30,
(unaudited)

 

2020

 

2019

 

2020

 

2019

 

(In millions)

Net income (loss) attributable to Hess Corporation

$

(243)

 

 

$

(212)

 

 

$

(2,996)

 

 

$

(186)

 

Less: Total items affecting comparability of earnings between periods

(27)

 

 

(107)

 

 

(2,278)

 

 

(85)

 

Adjusted net income (loss) attributable to Hess Corporation

$

(216)

 

 

$

(105)

 

 

$

(718)

 

 

$

(101)

 

The following table reconciles reported net cash provided by (used in) operating activities from net cash provided by (used in) operating activities before changes in operating assets and liabilities:

 

Three Months Ended
September 30,
(unaudited)

 

Nine Months Ended
September 30,
(unaudited)

 

2020

 

2019

 

2020

 

2019

 

(In millions)

Net cash provided by (used in) operating activities before changes in operating assets and liabilities

$

468

 

 

$

522

 

 

$

1,271

 

 

$

1,717

 

Changes in operating assets and liabilities

(332)

 

 

(79)

 

 

(424)

 

 

(361)

 

Net cash provided by (used in) operating activities

$

136

 

 

$

443

 

 

$

847

 

 

$

1,356

 

Hess Corporation will review third quarter financial and operating results and other matters on a webcast at 10 a.m. today (EDT). For details about the event, refer to the Investor Relations section of our website at www.hess.com.

Hess Corporation is a leading global independent energy company engaged in the exploration and production of crude oil and natural gas. More information on Hess Corporation is available at www.hess.com.

Forward-looking Statements

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Words such as “anticipate,” “estimate,” “expect,” “forecast,” “guidance,” “could,” “may,” “should,” “would,” “believe,” “intend,” “project,” “plan,” “predict,” “will,” “target” and similar expressions identify forward-looking statements, which are not historical in nature. Our forward-looking statements may include, without limitation: our future financial and operational results; our business strategy; estimates of our crude oil and natural gas reserves and levels of production; benchmark prices of crude oil, NGLs and natural gas and our associated realized price differentials; our projected budget and capital and exploratory expenditures; expected timing and completion of our development projects and proposed asset sale; and future economic and market conditions in the oil and gas industry.

Forward-looking statements are based on our current understanding, assessments, estimates and projections of relevant factors and reasonable assumptions about the future. Forward-looking statements are subject to certain known and unknown risks and uncertainties that could cause actual results to differ materially from our historical experience and our current projections or expectations of future results expressed or implied by these forward-looking statements. The following important factors could cause actual results to differ materially from those in our forward-looking statements: fluctuations in market prices of crude oil, NGLs and natural gas and competition in the oil and gas exploration and production industry, including as a result of the global COVID-19 pandemic; potential disruption or interruption of our operations due to catastrophic events, such as accidents, severe weather, geological events, shortages of skilled labor, cyber-attacks or health measures related to COVID-19; reduced demand for our products, including due to the global COVID-19 pandemic or the outbreak of any other public health threat or due to the impact of competing or alternative energy products and political conditions and events, such as instability, changes in governments, armed conflict, and economic sanctions; potential failures or delays in increasing oil and gas reserves, including as a result of unsuccessful exploration activity, drilling risks and unforeseen reservoir conditions; potential failures or delays in achieving expected production levels given inherent uncertainties in estimating quantities of proved reserves; changes in tax, property, contract and other laws, regulations and governmental actions applicable to our business, including legislative and regulatory initiatives regarding environmental concerns, such as measures to limit greenhouse gas emissions and well fracking bans; the ability of our contractual counterparties to satisfy their obligations to us, including the operation of joint ventures under which we may not control; the ability to satisfy the conditions to the proposed sale; unexpected changes in technical requirements for constructing, modifying or operating exploration and production facilities and/or the inability to timely obtain or maintain necessary permits; availability and costs of employees and other personnel, drilling rigs, equipment, supplies and other required services; any limitations on our access to capital or increase in our cost of capital as a result of weakness in the oil and gas industry or negative outcomes within commodity and financial markets; liability resulting from litigation, including heightened risks associated with being a general partner of Hess Midstream LP; and other factors described in Item 1A—Risk


Contacts

For Hess Corporation

Investors:
Jay Wilson
(212) 536-8940

Media:
Lorrie Hecker
(212) 536-8250

Jamie Tully
Sard Verbinnen & Co
(312) 895-4700


Read full story here

MIAMI--(BUSINESS WIRE)--World Fuel Services Corporation (NYSE: INT) today announced that it has published its 2019 Sustainability Report, which highlights the company’s efforts around key environmental, social and governance areas that are important to the company’s business as well as its employees, customers, suppliers, investors and other stakeholders. The report covers a broad range of actions and initiatives that demonstrate World Fuel Services Corporation’s commitment to create a more environmentally and socially sustainable world.


The sustainability report includes World Fuel Services Corporation’s carbon footprint, reflecting the company’s global scope 1 and scope 2 greenhouse gas (GHG) emissions for 2019, totaling approximately 60,000 metric tons of CO2 emissions. The company’s management team then designed a comprehensive renewable energy and carbon offset program to make the carbon emissions from its operations net zero for 2019. World Fuel Services Corporation is focused on making additional enhancements to its processes and technologies with the aim of further improving efficiencies and decarbonizing its operations over the long-term to achieve its sustainability goals.

“We have dedicated our resources with the aim of creating a more sustainable future for quite some time, and we believe this resonates through our actions, investments, and energy solutions,” stated Michael J. Kasbar, chairman and chief executive officer. “To further assist in accelerating the world’s energy transition, we are committed to continuing to drive innovative and cost-effective sustainability solutions for our clients, including increasing the availability and affordability of low to zero-carbon energy sources.”

About World Fuel Services Corporation

Headquartered in Miami, Florida, World Fuel Services is a global energy management company involved in providing energy procurement advisory services, supply fulfillment and transaction and payment management solutions to commercial and industrial customers, principally in the aviation, marine and land transportation industries. World Fuel Services sells fuel and delivers services to its clients at more than 8,000 locations in more than 200 countries and territories worldwide.

Information Relating to Forward-Looking Statements

This release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our beliefs and expectations with respect to the enhancements to our processes and technologies and our ability to further improve efficiencies and decarbonize our operations over the long-term, our expectations regarding our dedication of resources and our actions, investments and energy solutions, as well as our ability to drive innovative and cost-effective sustainability solutions for our clients, including increasing the availability and affordability of low to zero-carbon energy sources. These forward-looking statements are qualified in their entirety by cautionary statements and risk factor disclosures contained in the company’s Securities and Exchange Commission (“SEC”) filings, including the company’s most recent Annual Report on Form 10-K filed with the SEC.

Actual results may differ materially from any forward-looking statements due to risks and uncertainties, including, but not limited to: adverse conditions in the industries in which our customers operate and our ability to effectively manage the effects of the coronavirus pandemic; customer and counterparty creditworthiness and our ability to collect accounts receivable and settle derivative contracts, particularly for those customers most significantly impacted by the pandemic; sudden changes in the market price of fuel or extremely high or low fuel prices that continue for an extended period of time; the impact of climate change, extreme weather and natural disasters, including the economic, operational and other effects of severe storms, hurricanes, droughts and earthquakes; seasonal variability that adversely affects our revenues and operating results; changes in the political, economic or regulatory environment generally and in the markets in which we operate, including costs of compliance with existing and future environmental requirements, such as those related to climate change; reputational harm and potential impacts on our ability to attract or retain talent arising from negative perception of fossil fuels, environmental impacts and health and safety incidents; our ability to effectively leverage technology and realize the anticipated benefits; federal and state regulations, laws and other efforts designed to promote and expand the use of energy efficiency measures and related advancements in technology that reduce energy consumption; our ability to capitalize on new market opportunities and successfully implement our growth strategy; our ability to integrate acquired businesses and recognize the anticipated benefits; the effects of competition on our ability to grow our sustainability offerings; environmental and other risks associated with the storage, transportation and delivery of petroleum products; risks associated with operating in high-risk locations, including supply disruptions, border closures and other logistical difficulties that arise when working in these areas; the loss of, or reduced sales to a significant government customer, such as the North Atlantic Treaty Organization; our ability to achieve the expected level of benefit from any restructuring activities and cost reduction initiatives as well as successfully execute and achieve efficiencies; the availability of cash and sufficient liquidity to fund our working capital and strategic investment needs; uninsured losses; unanticipated tax liabilities or adverse results of tax audits, assessments, or disputes; the outcome of pending litigation and other proceedings; our ability to retain and attract senior management and other key employees and other risks detailed from time to time in our SEC filings.

We operate in a very competitive and rapidly changing environment and new risks emerge from time to time. It is not possible for us to predict all of those risks, nor can we assess the impact of all of those risks on our business or the extent to which any factor may cause actual results to differ materially from those contained in any forward-looking statement. Further, forward-looking statements speak only as of the date they are made, and unless required by law, we expressly disclaim any obligation or undertaking to publicly update any of them in light of new information, future events, or otherwise. Any public statements or disclosures by us following this report that modify or impact any of the forward-looking statements contained in or accompanying this report will be deemed to modify or supersede such forward-looking statements.


Contacts

Ira M. Birns
Executive Vice President & Chief Financial Officer
Glenn Klevitz
Vice President, Treasurer & Investor Relations
305-428-8000
www.wfscorp.com

ST. JOHN’S, Newfoundland and Labrador--(BUSINESS WIRE)--$ALS.TO--Altius Minerals Corporation (ALS:TSX) (ATUSF:OTCQX) (“Altius”) is pleased to report the first investment under the recently announced joint venture between its subsidiary, Altius Renewable Royalties Corp., and certain funds managed by affiliates of Apollo Global Management, Inc. (NYSE:APO) (“Apollo”). This US$25 million investment in Tri Global Energy (“TGE”) follows an initial US$30 million investment announced in Q1 2019 and reflects TGE’s continuing success in completing project sales with attached royalties while also expanding its future projects pipeline. The full text of the announcement by Great Bay Renewables, LLC, the operating subsidiary of the Altius-Apollo joint venture, is reproduced below.


Great Bay Renewables Extends Additional Renewable Royalty Financing to Tri Global Energy

October 28, 2020 | Great Bay Renewables News & Media

PORTSMOUTH, N.H. (October 28, 2020) – Great Bay Renewables, LLC (“Great Bay”) is pleased to announce that it has closed an additional US$25 million royalty investment in Tri Global Energy’s (“TGE”) portfolio of wind and solar energy development projects located across the United States.

This follow-on investment in TGE is the first investment made by Great Bay following the recently announced joint venture between certain funds managed by affiliates of Apollo Global Management, Inc. (NYSE:APO) and Altius Minerals Corporation (TSX:ALS) subsidiary Altius Renewable Royalties Corp. to accelerate the growth of Great Bay’s innovative renewable energy royalty business (see press release).

The additional investment into TGE is an extension of the current US$30 million royalty investment that Great Bay made in TGE in early 2019, bringing the total royalty capital commitment to US$55 million. As TGE develops and sells individual projects, Great Bay receives a gross revenue royalty on each project for the full life of the project. To date, TGE has sold nearly 1 GW of renewable energy projects subject to the Great Bay royalty program and currently has over 2.5 GW in its development pipeline.

Frank Getman, President and CEO of Great Bay, commented, “We are excited to provide this extension of our current royalty investment based on TGE’s continued success in selling projects and expanding its development portfolio. The Great Bay royalty capital is helping TGE expand and diversify into developing solar energy as well as additional wind energy projects in new regions. We value our partnership with TGE and are thrilled to continue the advancement of a clean energy future through our renewable royalty financing.”

“Today Tri Global Energy is one of the top five developers of wind energy in the U.S. because of our commitment to growth and notable partnerships, like that with Great Bay,” said John Billingsley, Chairman and CEO of Tri Global Energy.

“We also really believe the future of this country and around the world is renewable energy. And it’s not a question of whether or when we’re going to get there. We’re already here,” Billingsley said.

Great Bay was advised on this transaction by an advisory team from CCA Capital LLC led by Martin Pasqualini and a legal team at Pierce Atwood LLP led by Kris Eimicke.

About Great Bay Renewables
Great Bay provides capital to the renewable energy sector in exchange for royalties in renewable energy generating facilities at all stages in their life cycle. Great Bay’s management team has extensive experience in renewable energy development, financing and operations across a range of renewable technologies located throughout the United States. Great Bay is backed by Altius Renewable Royalties Corp. and funds managed by affiliates of Apollo. Learn more about Great Bay at www.greatbayrenewables.com or follow us on LinkedIn.

About Tri Global Energy
Tri Global Energy (TGE) is an independent renewable energy originator and developer in the U.S. The company is the leading wind developer in Texas and among the top five in the U.S. for projects under construction. Nearly 4,000 megawatts of TGE’s development projects are either in financing, construction or operation, including wind, solar and energy storage projects.

Founded in 2009, Tri Global Energy’s mission is to improve communities through local economic development generated by originating and commercializing renewable energy projects. The company currently develops and owns utility-scale wind and solar energy projects in Texas, Nebraska, Illinois, Indiana, Pennsylvania and Virginia. Tri Global Energy is headquartered in Dallas with regional development offices in Lubbock, Texas; El Paso and Forreston, Illinois and Hartford City, Indiana. For more information, visit www.triglobalenergy.com.

About Altius
Altius’s strategy is to create per share growth through a diversified portfolio of royalty assets that relate to long life, high margin operations. This strategy further provides shareholders with exposures that are well aligned with sustainability-related global growth trends including the electricity generation transition from fossil fuel to renewables, transportation electrification, reduced emissions from steelmaking and increasing agricultural yield requirements. These each hold the potential to cause increased demand for many of Altius’s commodity exposures including copper, renewable based electricity, several key battery metals (lithium, nickel and cobalt), clean iron ore, and potash. Altius has 41,464,462 common shares issued and outstanding that are listed on Canada’s Toronto Stock Exchange. It is a member of both the S&P/TSX Small Cap and S&P/TSX Global Mining Indices.

Forward-Looking Information
This news release contains forward-looking information. The statements are based on reasonable assumptions and expectations of management and Altius provides no assurance that actual events will meet management's expectations. In certain cases, forward-looking information may be identified by such terms as "anticipates", "believes", "could", "estimates", "expects", "may", "shall", "will", or "would". Although Altius believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those projected. Readers should not place undue reliance on forward-looking information. Altius does not undertake to update any forward-looking information contained herein except in accordance with securities regulation.


Contacts

Flora Wood
This email address is being protected from spambots. You need JavaScript enabled to view it.
Tel: 1.877.576.2209
Direct: +1(416)346.9020

Ben Lewis
This email address is being protected from spambots. You need JavaScript enabled to view it.
1.877.576.2209

LONDON--(BUSINESS WIRE)--nVent Electric plc (NYSE:NVT) (“nVent”), a global leader in electrical connection and protection solutions, today launched the nVent RAYCHEM Supervisor IIoT (Industrial Internet of Things) platform, which is designed to connect, control and monitor temperature-critical assets.

The first offering of nVent’s new IIoT platform will be nVent RAYCHEM Pipeline Supervisor, which the company expects to deliver a groundbreaking “temperature-sensitive” heat trace monitoring software solution. It will offer unique access to performance trends and rich actionable data insights to enable the safe and efficient operation of vital heat tracing infrastructure.

“The nVent RAYCHEM Supervisor IIoT platform represents the culmination of nVent’s experience with engineering and deploying critical heat tracing infrastructure,” says Brad Faulconer, President of nVent’s Thermal Management segment. “We are excited our first offering within this platform will be nVent RAYCHEM Pipeline Supervisor, which will feature state of the art software-based solutions for predictive maintenance of temperature-sensitive pipelines.”

nVent RAYCHEM Supervisor and Elexant Controllers

With installations in facilities owned by the world’s largest chemical producers and oil and gas refiners, nVent RAYCHEM Supervisor incorporates 17 years of field-proven experience in demanding industrial applications. Supervisor is designed to program and monitor nVent RAYCHEM electronic temperature control products from centralized and remote locations.

nVent’s recently-launched Elexant controllers combined with the Elexant 9200i wireless connectivity interface provide centralized control and seamless connectivity to streamline data integration, manage energy consumption and maximize operational efficiencies.

nVent RAYCHEM Pipeline Supervisor

nVent RAYCHEM Pipeline Supervisor will enable operators and field maintenance personnel to assess heat trace infrastructure health in real time with a flexible browser-based user interface, aimed to optimize flow assurance and reduce operating costs. Using predictive analytics, Pipeline Supervisor will provide advanced warnings of pending threats to the safe and secure operation of critical pipelines.

A Complete Turn-Key Solution

nVent provides a complete turn-key product and services package for all control and monitoring solutions with design, engineering and commissioning capabilities, for a successful deployment in the field. This includes a comprehensive services package to ensure customers are fully supported post-deployment. Furthermore, nVent RAYCHEM Pipeline Supervisor will be compatible for retrofits so it can be seamlessly incorporated into existing infrastructure.

Through ongoing investment in research and development, nVent continues to be at the forefront of IIoT software and controller innovation throughout the heat tracing industry.

For more information on nVent RAYCHEM Supervisor products, please visit raychem.nvent.com/IIoT.

About nVent

nVent is a leading global provider of electrical connection and protection solutions. We believe our inventive electrical solutions enable safer systems and ensure a more secure world. We design, manufacture, market, install and service high performance products and solutions that connect and protect some of the world's most sensitive equipment, buildings and critical processes. We offer a comprehensive range of enclosures, electrical connections and fastening and thermal management solutions across industry-leading brands that are recognized globally for quality, reliability and innovation. Our principal office is in London and our management office in the United States is in Minneapolis. Our robust portfolio of leading electrical product brands dates back more than 100 years and includes nVent CADDY, ERICO, HOFFMAN, RAYCHEM, SCHROFF and TRACER.

nVent, CADDY, ERICO, HOFFMAN, RAYCHEM, SCHROFF and TRACER are trademarks owned or licensed by nVent Services GmbH or its affiliates.


Contacts

Media Contacts:
Will Wright, +1-713-735-8740
nVent Marketing Manager
This email address is being protected from spambots. You need JavaScript enabled to view it.

Third Quarter 2020 Highlights:


  • Net income was $115.8 million. Net cash provided by operating activities was $149.6 million.
  • Net income attributable to Hess Midstream LP was $5.6 million, or $0.31 per Class A share, after deduction for noncontrolling interests.
  • Adjusted EBITDA1 was $181.6 million, DCF1 was $156.2 million and free cash flow1 was $115.2 million.
  • Increased quarterly cash distribution to $0.4417 per Class A share, an increase of 1.2% compared with the second quarter of 2020, resulting in a 1.2x coverage ratio relative to distributions.
  • Throughput volumes increased across all segments compared with the prior-year quarter, including 14% for gas processing and 8% for crude oil terminaling, driven by higher Hess Corporation production and increased gas capture by Hess Midstream LP.

Guidance:

  • Following strong year-to-date results, Hess Midstream LP is raising its full year 2020 guidance for net income to $465 - $475 million and Adjusted EBITDA to $725 - $735 million, representing 48% and 33% growth, respectively, at the midpoint compared with full year 2019 results.
  • Hess Midstream LP expects approximately 20% growth in Adjusted EBITDA in 2021 compared with newly issued and increased full year 2020 Adjusted EBITDA guidance.
  • Hess Midstream LP is reaffirming its previously announced expectation for annual free cash flow in both 2021 and 2022 of approximately $750 million, with approximately 95% minimum volume commitment revenue protection, fully funding interest and growing distributions without incremental debt or equity.
  • Hess Midstream LP is reaffirming its 5% annual distribution per share growth rate target through 2022 with expected distribution coverage of approximately 1.3x in 2020 and 1.4x in 2021 and 2022.

HOUSTON--(BUSINESS WIRE)--Hess Midstream LP (NYSE: HESM) (“Hess Midstream”) today reported third quarter 2020 net income of $115.8 million compared with net income of $87.4 million for the third quarter of 2019, as recast for the 2019 acquisition of Hess Infrastructure Partners LP (“HIP”) by Hess Midstream Operations LP (formerly known as Hess Midstream Partners LP) (the “Partnership”), Hess Midstream’s controlled subsidiary. After deduction for noncontrolling interests, net income attributable to Hess Midstream was $5.6 million, or $0.31 per Class A share. Hess Midstream generated Adjusted EBITDA of $181.6 million. DCF for the third quarter of 2020 was $156.2 million and free cash flow was $115.2 million.

_______________________________

1 Adjusted EBITDA, DCF and free cash flow are non‑GAAP measures. Definitions and reconciliations of these non‑GAAP measures to GAAP reporting measures appear in the following pages of this release.

 

Commenting on the third quarter 2020 results, John Gatling, President and Chief Operating Officer of Hess Midstream said, “We achieved another strong quarter driven by higher Hess production and increased gas capture by Hess Midstream. We are on track to deliver over 30% Adjusted EBITDA growth this year compared to 2019 and expect another year of Adjusted EBITDA growth in 2021 supported by our contracts. The strength and visibility of our business model is clear even in this period of macro uncertainty.”

Hess Midstream’s results contained in this release include the historical results of HIP for all periods prior to the closing of the Partnership’s acquisition of HIP, incentive distribution rights simplification and conversion from a master limited partnership into an “Up-C” structure on December 16, 2019 (collectively, the “Transaction”), which was accounted for as a business combination of entities under common control. We refer to certain results as “attributable to Hess Midstream LP,” which exclude (i) the noncontrolling interests in the Partnership retained by affiliates of Hess Corporation (“Hess”) and Global Infrastructure Partners, (ii) the noncontrolling interests in the historical operating subsidiaries of the Partnership, and (iii) historical activity of HIP prior to its acquisition by the Partnership, which is included in “net parent investment.”

Ongoing Response to COVID-19

The safety of our workforce and the communities where we operate continues to be our top priority. A cross-functional response team remains in place to coordinate our COVID-19 response from a health and safety perspective and to ensure that the detailed prevention protocols in place at all Hess Midstream assets are based on the most current recommendations by government and public health agencies.

Financial Results

Revenues and other income in the third quarter of 2020 were $264.8 million compared with $214.9 million in the prior-year quarter. Third quarter 2020 revenues included $29.3 million of pass-through rail transportation, electricity, produced water trucking and disposal costs and $7.8 million of shortfall fee payments related to minimum volume commitments (“MVC”) compared with $34.8 million and $3.0 million, respectively, in the prior-year quarter. Revenues were up primarily attributable to higher throughput volumes, MVC levels and tariff rates. Total costs and expenses in the third quarter of 2020 were $127.6 million up from $115.6 million in the prior-year quarter, primarily attributable to higher Little Missouri 4 (“LM4”) processing fees, maintenance expenditures on expanded infrastructure and depreciation expense for additional assets placed in service.

Net income for the third quarter of 2020 was $115.8 million and net cash provided by operating activities for the quarter was $149.6 million.

Adjusted EBITDA for the third quarter of 2020 was $181.6 million. Relative to distributions, DCF for the third quarter of 2020 of $156.2 million resulted in an approximately 1.2x distribution coverage ratio. Free cash flow for the third quarter of 2020 was $115.2 million.

Operational Highlights

Throughput volumes were up in all segments in the third quarter of 2020 compared with the third quarter of 2019 driven by higher Hess production and increased gas capture by Hess Midstream. In the gathering segment, throughput volumes increased 17% for gas gathering, 16% for crude oil gathering and 73% for water gathering. In the gas processing segment, throughput volumes increased 14%, and in the crude oil terminaling segment, throughput volumes increased 8%. Third parties comprised approximately 9% of crude oil gathering and 7% of gas gathering volumes for the third quarter of 2020.

Capital Expenditures

Capital expenditures for the third quarter of 2020 totaled $66.4 million, including $62.6 million of expansion capital expenditures and $3.8 million of maintenance capital expenditures. Capital expenditures in the prior-year quarter were $122.3 million, including $110.9 million of expansion capital expenditures, $10.0 million of equity investments associated with the LM4 gas processing plant, and $1.4 million of maintenance capital expenditures. Expansion capital expenditures in the third quarter of 2020 were primarily attributable to field construction activities for the planned expansion of the Tioga Gas Plant.

Quarterly Cash Distributions

On October 26, 2020, our general partner’s board of directors declared a cash distribution of $0.4417 per Class A share for the third quarter of 2020, an increase of 1.2% over the distribution for the prior quarter, which equals a 5% increase on an annualized basis. The distribution is expected to be paid on November 13, 2020 to shareholders of record as of the close of business on November 5, 2020.

2020 Guidance

Following strong year-to-date results, Hess Midstream updates its full year 2020 guidance as follows:

 

 

Year Ending

 

 

 

December 31, 2020

 

 

 

(Unaudited)

 

Financials (in millions)

 

 

 

 

Net income

 

$

465 - 475

 

Adjusted EBITDA

 

$

725 - 735

 

Distributable cash flow

 

$

625 - 635

 

Expansion capital

 

$

250

 

Maintenance capital

 

$

10

 

Free cash flow

 

$

465 - 475

 

 

 

Year Ending

 

 

December 31, 2020

 

 

(Unaudited)

Throughput volumes (in thousands)

 

 

Gas gathering - Mcf of natural gas per day

 

315 - 320

Crude oil gathering - barrels of oil per day

 

135 - 140

Gas processing - Mcf of natural gas per day

 

300 - 305

Crude terminals - barrels of oil per day

 

140 - 145

Water gathering - barrels of liquids per day

 

65 - 70

Investor Webcast

Hess Midstream will review third quarter financial and operating results and other matters on a webcast today at 12:00 p.m. Eastern Time. The live audio webcast is accessible on the Investor page of our website www.hessmidstream.com. Conference call numbers for participation are 866-395-9624, or 213-660-0871 for international callers. The passcode number is 6679756. A replay of the conference call will be available at the same location following the event.

About Hess Midstream

Hess Midstream LP is a fee‑based, growth-oriented midstream company that operates, develops and acquires a diverse set of midstream assets to provide services to Hess and third‑party customers. Hess Midstream owns oil, gas and produced water handling assets that are primarily located in the Bakken and Three Forks Shale plays in the Williston Basin area of North Dakota. More information is available at www.hessmidstream.com.

Reconciliation of U.S. GAAP to Non‑GAAP Measures

In addition to our financial information presented in accordance with U.S. generally accepted accounting principles (“GAAP”), management utilizes certain additional non‑GAAP measures to facilitate comparisons of past performance and future periods. “Adjusted EBITDA” presented in this release is defined as reported net income (loss) before net interest expense, income tax expense, depreciation and amortization and our proportional share of depreciation of our equity affiliates, as further adjusted to eliminate the impact of certain items that we do not consider indicative of our ongoing operating performance, such as transaction costs, other income and other non‑cash, non‑recurring items, if applicable. “Distributable Cash Flow” or “DCF” is defined as Adjusted EBITDA less net interest, excluding amortization of deferred financing costs, cash paid for federal and state income taxes and maintenance capital expenditures. DCF does not reflect changes in working capital balances. “Free cash flow” is defined as Adjusted EBITDA less capital expenditures, excluding acquisition capital expenditures. We believe that investors’ understanding of our performance is enhanced by disclosing these measures as they may assist in assessing our operating performance as compared to other publicly traded companies in the midstream energy industry, without regard to historical cost basis or, in the case of Adjusted EBITDA, financing methods, and assessing the ability of our assets to generate sufficient cash flow to make distributions to our shareholders. These measures are not, and should not be viewed as, a substitute for GAAP net income or cash flow from operating activities and should not be considered in isolation. Reconciliations of Adjusted EBITDA, DCF and free cash flow to reported net income (GAAP) and net cash provided by operating activities (GAAP), are provided below.

 

 

Third Quarter

 

 

 

(unaudited)

 

 

 

2020

 

 

2019(1)

 

 

 

 

 

 

 

 

 

 

(in millions, except ratio and per-share/limited partner unit data)

 

 

 

 

 

 

 

 

Reconciliation of Adjusted EBITDA and

Distributable Cash Flow to net income:

 

 

 

 

 

 

 

 

Net income

 

$

115.8

 

 

$

87.4

 

Plus:

 

 

 

 

 

 

 

 

Depreciation expense

 

 

39.5

 

 

 

36.0

 

Proportional share of equity affiliates' depreciation

 

 

1.3

 

 

 

0.5

 

Interest expense, net

 

 

23.2

 

 

 

12.4

 

Income tax expense (benefit)

 

 

1.8

 

 

 

-

 

Adjusted EBITDA

 

 

181.6

 

 

 

136.3

 

Less:

 

 

 

 

 

 

 

 

Interest, net

 

 

21.6

 

 

 

 

 

Maintenance capital expenditures

 

 

3.8

 

 

 

 

 

Distributable cash flow

 

$

156.2

 

 

 

 

 

Less:

 

 

 

 

 

 

 

 

Adjusted EBITDA attributable to noncontrolling interest

and net parent investment

 

 

 

 

 

 

109.7

 

Cash interest paid, net

 

 

 

 

 

 

0.6

 

Maintenance capital expenditures, net

 

 

 

 

 

 

0.3

 

Distributable cash flow, as previously reported(2)

 

 

 

 

 

$

25.7

 

 

 

 

 

 

 

 

 

 

Reconciliation of Adjusted EBITDA,

Distributable Cash Flow and free cash flow

to net cash provided by operating activities:

 

 

 

 

 

 

 

 

Net cash provided by operating activities

 

$

149.6

 

 

$

83.4

 

Changes in assets and liabilities

 

 

8.9

 

 

 

37.0

 

Amortization of deferred financing costs

 

 

(1.6

)

 

 

(1.3

)

Proportional share of equity affiliates' depreciation

 

 

1.3

 

 

 

0.5

 

Interest expense, net

 

 

23.2

 

 

 

12.4

 

Capitalized interest

 

 

-

 

 

 

4.1

 

Earnings from equity investments

 

 

3.6

 

 

 

0.5

 

Distribution from equity investments

 

 

(3.0

)

 

 

-

 

Other

 

 

(0.4

)

 

 

(0.3

)

Adjusted EBITDA

 

$

181.6

 

 

$

136.3

 

Less:

 

 

 

 

 

 

 

 

Interest, net

 

 

21.6

 

 

 

 

 

Maintenance capital expenditures

 

 

3.8

 

 

 

 

 

Distributable cash flow

 

$

156.2

 

 

 

 

 

Less:

 

 

 

 

 

 

 

 

Adjusted EBITDA attributable to noncontrolling interest

and net parent investment

 

 

 

 

 

 

109.7

 

Cash interest paid, net

 

 

 

 

 

 

0.6

 

Maintenance capital expenditures, net

 

 

 

 

 

 

0.3

 

Distributable cash flow, as previously reported(2)

 

 

 

 

 

$

25.7

 

Adjusted EBITDA

 

$

181.6

 

 

$

136.3

 

Less:

 

 

 

 

 

 

 

 

Capital expenditures

 

 

66.4

 

 

 

122.3

 

Free cash flow

 

$

115.2

 

 

$

14.0

 

Distributed cash flow(2)

 

 

125.6

 

 

 

23.8

 

Distribution coverage ratio

 

 

1.2

x

 

 

1.1

x

Distribution per Class A share/limited partner unit

 

$

0.4417

 

 

$

0.4112

 

(1)

Prior period information has been retrospectively adjusted for the acquisition of Hess Infrastructure Partners LP.

(2)

Distributable cash flow prior to the Transaction is calculated net of any amounts attributable to noncontrolling interest. Subsequent to the Transaction, Hess Midstream will generally make cash distributions to holders of Class A Shares and to holders of noncontrolling interest pro rata. Therefore, distributable and distributed cash flow subsequent to the Transaction includes amounts attributable to noncontrolling interest.

 

Guidance

 

 

Year Ending

 

 

December 31, 2020

 

 

(Unaudited)

 

(in millions)

 

 

 

 

Reconciliation of Adjusted EBITDA, Distributable Cash Flow

and free cash flow to net income:

 

 

 

 

Net income

$

465 - 475

 

Plus:

 

 

 

 

Depreciation expense*

 

 

155

 

Interest expense, net

 

 

95

 

Income tax expense

 

 

10

 

Adjusted EBITDA

 

725 - 735

 

Less:

 

 

 

 

Interest, net, and maintenance capital expenditures

 

 

100

 

Distributable cash flow

 

625 - 635

 

 

 

 

 

 

Adjusted EBITDA

 

725 - 735

 

Less:

 

 

 

 

Capital expenditures

 

 

260

 

Free cash flow

 

465 - 475

 

*Includes proportional share of equity affiliates' depreciation

 

 

 

 

Cautionary Note Regarding Forward-looking Information

This press release contains “forward-looking statements” within the meaning of U.S. federal securities laws. Words such as “anticipate,” “estimate,” “expect,” “forecast,” “guidance,” “could,” “may,” “should,” “would,” “believe,” “intend,” “project,” “plan,” “predict,” “will,” “target” and similar expressions identify forward-looking statements, which are not historical in nature. Our forward-looking statements may include, without limitation: our future financial and operational results; our business strategy; our industry; our expected revenues; our future profitability; our maintenance or expansion projects; our projected budget and capital expenditures and the impact of such expenditures on our performance; and future economic and market conditions in the oil and gas industry.

Forward-looking statements are based on our current understanding, assessments, estimates and projections of relevant factors and reasonable assumptions about the future. Forward-looking statements are subject to certain known and unknown risks and uncertainties that could cause actual results to differ materially from our historical experience and our current projections or expectations of future results expressed or implied by these forward-looking statements. The following important factors could cause actual results to differ materially from those in our forward-looking statements: the direct and indirect effects of the COVID-19 global pandemic and other public health developments on our business and those of our business partners, suppliers and customers, including Hess; the ability of Hess and other parties to satisfy their obligations to us, including Hess’ ability to meet its drilling and development plans on a timely basis or at all and the operation of joint ventures that we may not control; our ability to generate sufficient cash flow to pay current and expected levels of distributions; reductions in the volumes of crude oil, natural gas, natural gas liquids (“NGLs”) and produced water we gather, process, terminal or store; fluctuations in the prices and demand for crude oil, natural gas and NGLs, including as a result of the COVID-19 global pandemic; changes in global economic conditions and the effects of a global economic downturn on our business and the business of our suppliers, customers, business partners and lenders; our ability to comply with government regulations or make capital expenditures required to maintain compliance, including our ability to obtain or maintain permits necessary for capital projects in a timely manner, if at all, or the revocation or modification of existing permits; our ability to successfully identify, evaluate and timely execute our capital projects, investment opportunities and growth strategies, whether through organic growth or acquisitions; costs or liabilities associated with federal, state and local laws, regulations and governmental actions applicable to our business, including legislation and regulatory initiatives relating to environmental protection and safety, such as spills, releases, pipeline integrity and measures to limit greenhouse gas emissions; our ability to comply with the terms of our credit facility, indebtedness and other financing arrangements, which, if accelerated, we may not be able to repay; reduced demand for our midstream services, including the impact of weather or the availability of the competing third-party midstream gathering, processing and transportation operations; potential disruption or interruption of our business due to catastrophic events, such as accidents, severe weather events, labor disputes, information technology failures, constraints or disruptions and cyber-attacks; any limitations on our ability to access debt or capital markets on terms that we deem acceptable, including as a result of weakness in the oil and gas industry or negative outcomes within commodity and financial markets; liability resulting from litigation; and other factors described in Item 1A—Risk Factors in our Annual Report on Form 10-K and any additional risks described in our other filings with the Securities and Exchange Commission.

As and when made, we believe that our forward-looking statements are reasonable. However, given these risks and uncertainties, caution should be taken not to place undue reliance on any such forward-looking statements since such statements speak only as of the date when made and there can be no assurance that such forward-looking statements will occur and actual results may differ materially from those contained in any forward-looking statement we make. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events or otherwise.

HESS MIDSTREAM LP

SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)

(IN MILLIONS)

 

 

 

Third

 

 

Third

 

 

Second

 

 

 

Quarter

 

 

Quarter

 

 

Quarter

 

 

 

2020

 

 

2019(1)

 

 

2020

 

Statement of operations

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

Affiliate services

 

$

264.7

 

 

$

214.9

 

 

$

269.8

 

Other income

 

 

0.1

 

 

 

-

 

 

 

-

 

Total revenues

 

 

264.8

 

 

 

214.9

 

 

 

269.8

 

Costs and expenses

 

 

 

 

 

 

 

 

 

 

 

 

Operating and maintenance expenses

(exclusive of depreciation shown separately below)

 

 

83.9

 

 

 

71.9

 

 

 

95.0

 

Depreciation expense

 

 

39.5

 

 

 

36.0

 

 

 

38.9

 

General and administrative expenses

 

 

4.2

 

 

 

7.7

 

 

 

4.1

 

Total costs and expenses

 

 

127.6

 

 

 

115.6

 

 

 

138.0

 

Income from operations

 

 

137.2

 

 

 

99.3

 

 

 

131.8

 

Income from equity investments

 

 

3.6

 

 

 

0.5

 

 

 

0.9

 

Interest expense, net

 

 

23.2

 

 

 

12.4

 

 

 

23.3

 

Gain from sale of property, plant and equipment

 

 

-

 

 

 

-

 

 

 

0.1

 

Income before income tax expense (benefit)

 

 

117.6

 

 

 

87.4

 

 

 

109.5

 

Income tax expense (benefit)

 

 

1.8

 

 

 

-

 

 

 

1.7

 

Net income

 

$

115.8

 

 

$

87.4

 

 

$

107.8

 

Less: Net income (loss) attributable to net parent investment

 

 

-

 

 

 

(13.0

)

 

 

-

 

Less: Net income attributable to noncontrolling

interest

 

 

110.2

 

 

 

81.3

 

 

 

102.5

 

Net income attributable to Hess Midstream LP

 

 

5.6

 

 

 

19.1

 

 

 

5.3

 

Less: General partner's interest in net income

 

 

-

 

 

 

1.3

 

 

 

-

 

Limited partners' interest in net income

 

$

5.6

 

 

$

17.8

 

 

$

5.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to Hess Midstream LP

per Class A share/limited partner unit:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.31

 

 

 

 

 

 

$

0.29

 

Diluted

 

$

0.31

 

 

 

 

 

 

$

0.29

 

Net income attributable to Hess Midstream LP

per limited partner unit (basic and diluted):

 

 

 

 

 

 

 

 

 

 

 

 

Common

 

 

 

 

 

$

0.33

 

 

 

 

 

Subordinated

 

 

 

 

 

$

0.33

 

 

 

 

 

Weighted average Class A shares outstanding

subsequent to December 16, 2019:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

18.0

 

 

 

 

 

 

 

18.0

 

Diluted

 

 

18.1

 

 

 

 

 

 

 

18.1

 

Weighted average limited partner units outstanding

prior to December 16, 2019

 

 

 

 

 

 

 

 

 

 

 

 

Basic:

 

 

 

 

 

 

 

 

 

 

 

 

Common

 

 

 

 

 

 

27.3

 

 

 

 

 

Subordinated

 

 

 

 

 

 

27.3

 

 

 

 

 

Diluted:

 

 

 

 

 

 

 

 

 

 

 

 

Common

 

 

 

 

 

 

27.5

 

 

 

 

 

Subordinated

 

 

 

 

 

 

27.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Prior period information has been retrospectively adjusted for the acquisition of Hess Infrastructure Partners LP.

HESS MIDSTREAM LP

SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)

(IN MILLIONS)

 

 

 

Nine Months Ended September 30,

 

 

 

2020

 

 

2019 (1)

 

Statement of operations

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

Affiliate services

 

$

825.1

 

 

$

594.5

 

Other income

 

 

0.3

 

 

 

0.3

 

Total revenues

 

 

825.4

 

 

 

594.8

 

Costs and expenses

 

 

 

 

 

 

 

 

Operating and maintenance expenses

(exclusive of depreciation shown separately below)

 

 

270.8

 

 

 

184.1

 

Depreciation expense

 

 

116.9

 

 

 

105.0

 

General and administrative expenses

 

 

15.9

 

 

 

19.4

 

Total costs and expenses

 

 

403.6

 

 

 

308.5

 

Income from operations

 

 

421.8

 

 

 

286.3

 

Income from equity investments

 

 

7.2

 

 

 

0.5

 

Interest expense, net

 

 

71.3

 

 

 

44.2

 

Gain on sale of property, plant and equipment

 

 

0.1

 

 

 

-

 

Income before income tax expense (benefit)

 

 

357.8

 

 

 

242.6

 

Income tax expense (benefit)

 

 

5.2

 

 

 

-

 

Net income

 

$

352.6

 

 

$

242.6

 

Less: Net income (loss) attributable to net parent investment

 

 

-

 

 

 

(44.0

)

Less: Net income attributable to noncontrolling interest

 

 

335.2

 

 

 

232.6

 

Net income attributable to Hess Midstream LP

 

 

17.4

 

 

 

54.0

 

Less: General partner's interest in net income

 

 

-

 

 

 

3.1

 

Limited partners' interest in net income

 

$

17.4

 

 

$

50.9

 

 

 

 

 

 

 

 

 

 

Net income attributable to Hess Midstream LP

per Class A share:

 

 

 

 

 

 

 

 

Basic:

 

$

0.97

 

 

 

 

 

Diluted:

 

$

0.95

 

 

 

 

 

Net income attributable to Hess Midstream LP

per limited partner unit (basic and diluted):

 

 

 

 

 

 

 

 

Common

 

 

 

 

 

$

0.93

 

Subordinated

 

 

 

 

 

$

0.93

 

Weighted average Class A shares outstanding

subsequent to December 16, 2019

 

 

 

 

 

 

 

 

Basic

 

 

18.0

 

 

 

 

 

Diluted

 

 

18.1

 

 

 

 

 

Weighted average limited partner units outstanding

prior to December 16, 2019

 

 

 

 

 

 

 

 

Basic:

 

 

 

 

 

 

 

 

Common

 

 

 

 

 

 

27.3

 

Subordinated

 

 

 

 

 

 

27.3

 

Diluted:

 

 

 

 

 

 

 

 

Common

 

 

 

 

 

 

27.5

 

Subordinated

 

 

 

 

 

 

27.3

 

 

 

 

 

 

 

 

 

 

(1)

Prior period information has been retrospectively adjusted for the acquisition of Hess Infrastructure Partners LP.

HESS MIDSTREAM LP

SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)

(IN MILLIONS)

 

 

 

Third Quarter 2020

 

 

 

Gathering

 

 

Processing
and
Storage

 

 

Terminaling
and Export

 

 

Interest
and Other

 

 

Total

 

Statement of operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Affiliate services

 

$

142.9

 

 

$

90.1

 

 

$

31.7

 

 

$

-

 

 

$

264.7

 

Other income

 

 

-

 

 

 

0.1

 

 

 

-

 

 

 

-

 

 

 

0.1

 

Total revenues

 

 

142.9

 

 

 

90.2

 

 

 

31.7

 

 

 

-

 

 

 

264.8

 

Costs and expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating and maintenance expenses (exclusive of

depreciation shown separately below)

 

 

44.1

 

 

 

30.4

 

 

 

9.4

 

 

 

-

 

 

 

83.9

 

Depreciation expense

 

 

24.2

 

 

 

11.2

 

 

 

4.1

 

 

 

-

 

 

 

39.5

 

General and administrative expenses

 

 

2.2

 

 

 

1.5

 

 

 

0.2

 

 

 

0.3

 

 

 

4.2

 

Total costs and expenses

 

 

70.5

 

 

 

43.1

 

 

 

13.7

 

 

 

0.3

 

 

 

127.6

 

Income (loss) from operations

 

 

72.4

 

 

 

47.1

 

 

 

18.0

 

 

 

(0.3

)

 

 

137.2

 

Income from equity investments

 

 

-

 

 

 

3.6

 

 

 

-

 

 

 

-

 

 

 

3.6

 

Interest expense, net

 

 

-

 

 

 

-

 

 

 

-

 

 

 

23.2

 

 

 

23.2

 

Income before income tax expense (benefit)

 

 

72.4

 

 

 

50.7

 

 

 

18.0

 

 

 

(23.5

)

 

 

117.6

 

Income tax expense (benefit)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1.8

 

 

 

1.8

 

Net income (loss)

 

 

72.4

 

 

 

50.7

 

 

 

18.0

 

 

 

(25.3

)

 

 

115.8

 

Less: Net income (loss) attributable to

noncontrolling interest

 

 

67.9

 

 

 

47.5

 

 

 

16.9

 

 

 

(22.1

)

 

 

110.2

 

Net income (loss) attributable to

Hess Midstream LP

 

$

4.5

 

 

$

3.2

 

 

$

1.1

 

 

$

(3.2

)

 

$

5.6

 


Contacts

For Hess Midstream LP

Investors:
Jennifer Gordon
(212) 536-8244

Media:
Robert Young
(713) 496-6076


Read full story here

LONDON--(BUSINESS WIRE)--#GlobalLeakDetectionMarketforOilandGasIndustry--Scope of the report



This report provides a detailed analysis of the leak detection market by product (fixed leak detectors and portable leak detectors), end-user (downstream, upstream, and midstream), and geography (APAC, Europe, MEA, North America, and South America). Also, the report analyzes the market’s competitive landscape and offers information on several market vendors, including Emerson Electric Co., FLIR Systems Inc., Honeywell International Inc., nVent Electric Plc, Pentair Plc, Perma-Pipe International Holdings Inc., Schneider Electric SE, Siemens AG, SONOTEC GmbH, and Xylem Inc. Rise in emphasis on ensuring the safety of workers across end-user industries is a key trend in the global leak detection market which will lead to significant market growth. Prolonged exposure to various gases can be fatal and lead to serious health issues such as cancer. This is compelling end-users in the oil and gas industry to adopt several protective systems such as fire and gas detection equipment to ensure the safety of workers. All these factors are leading to a positive outlook for the leak detection market.

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Leak Detection Market for Oil and Gas Industry: Segmentation by Geography

The market is segmented into five regions encompassing APAC, Europe, MEA, North America, and South America. North America was the largest market for leak detection in 2019, and the region is expected to offer several growth opportunities to market vendors during the forecast period. About 41% of the market’s growth will originate from North America during the forecast period. Over the years, there has been a significant rise in oil and gas E&P activities in countries such as the US and Canada. In addition, governments in North America are undertaking various initiatives to increase oil and gas production for ensuring energy security. These factors are fueling the growth of the leak detection market in North America. The US is a key market for leak detection for the oil and gas industry in North America.

Leak Detection Market for Oil and Gas Industry: Segmentation by Product

The leak detection market is segmented into two segments based on solutions comprising of fixed leak detectors and portable leak detectors. The market witnessed an increased demand for fixed leak detectors in 2019. Fixed leak detectors are installed in areas that are known for potential risks such as chemical storage rooms, confined spaces, and areas that have proximity to flammable and toxic gases. They are also effective in operations that have underground applications. These factors are creating significant growth potential in the segment.

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Leak Detection Market for Oil and Gas Industry: Growth Drivers

Growing upstream investments will drive market growth. The growth in the global population and industrial development has increased the demand for energy. Besides, there is a decline in the production of oil and gas in several conventional oilfields. To meet the growing energy demand and maximize production from conventional oilfields, oil and gas companies are making significant investments in upstream activities. For instance, in August 2019, the Oil and Natural Gas Corp. announced a multi-billion investment plan to increase oil and gas output from its domestic and overseas fields by 100%. The company is also planning to double its refining capacity and diversify into renewables to obtain a four-fold higher net profit by 2040. Such investments in upstream activities will propel the growth of the global leak detection market.

Leak Detection Market for Oil and Gas Industry: Market overview

The leak detection market is fragmented with the presence of several domestic and international players. Hence, companies need to adopt advanced technologies and marketing strategies to remain competitive in the market. Emerson Electric Co., FLIR Systems Inc., and Honeywell International Inc. are some of the major market participants. Though the accelerating growth momentum will offer immense growth opportunities, the complexity of leak detection in harsh working conditions will challenge the growth of the market participants. To make the most of the opportunities, market vendors should focus more on the growth prospects in the fast-growing segments, while maintaining their position in the slow-growing segments.

Market Sizing Methodology

Technavio uses a robust market sizing approach to estimate the total opportunity size for any market. Some of the examples of methodologies are shown for reference data is collected through both primary research (through industry interview with market participants and industry experts) as well as secondary research (through annual reports, press releases, company and industry presentations, industry associations, journals and in-house data repositories built over past 15 years)

Leak Detection Market for Oil and Gas Industry: Parent Market Overview

Technavio categorizes the global leak detection market for oil and gas industry as a part of the global oilfield equipment and services market within the global oil and gas market. The global oilfield equipment and services market covers products and companies engaged in upstream exploration and production (E&P) operations, production of equipment or service contracts, and is an important manufacturing sector that caters to the needs of the oil and gas upstream sector.

Growth in the oilfield equipment and services market will be driven by the increase in global energy demand and robust growth in the power industry.

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Position aligns with Kleinfelder’s tremendous growth and value creation opportunities

SAN DIEGO--(BUSINESS WIRE)--The Kleinfelder Group, Inc., a leading engineering, design, construction management, construction materials inspection and testing, and environmental professional services firm, announced today that Chris King has been promoted to the role of Senior Vice President, Revenue Synergy Leader.

As Kleinfelder’s Revenue Synergy Leader, King will be responsible for the synergistic growth stemming from the recent acquisitions of Advantage Engineers, Garcia and Associates (GANDA), Poggemeyer Design Group (PDG), and Gas Transmission Systems (GTS). In this capacity, King will drive growth nationally through identification and execution of revenue synergies resulting from recent and future acquisitions within the growing Kleinfelder platform.

“Kleinfelder has been very active in implementing our growth strategy and value creation plan, of which targeted acquisitions are an important element,” said Kleinfelder Director of Strategic Growth Jay Clare. “With Chris leading our revenue synergy efforts, we are formalizing our commitment to maximizing the growth potential in front of us.”

Since joining Kleinfelder in 2015, King has held several leadership positions, including West Division Market Manager–a role in which he was responsible for the sales and revenue growth of Kleinfelder's largest division.

"We have experienced significant organic and acquisitive growth over the past year, making it an exciting time to be part of Kleinfelder,” King stated. “The revenue synergy position will allow me to work with teams from Kleinfelder and the acquired firms to enhance collaboration and capitalize on strategic growth opportunities. I look forward to the challenge and the road ahead."

Kleinfelder. Bright People. Right Solutions.

Founded in 1961, Kleinfelder is a leading engineering, design, construction management, construction materials inspection and testing, and environmental professional services firm. Kleinfelder employs more than 2,400 professionals and operates from over 85 office locations in the United States, Canada, and Australia. The company is headquartered in San Diego, California. Poised for growth, Kleinfelder continues to provide high-quality solutions for our diverse client base. Visit Kleinfelder.com or follow us on LinkedIn/Kleinfelder.


Contacts

Dustin Esposito
Marketing Communications Manager
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(617) 498‐4627

CITY OF INDUSTRY, Calif.--(BUSINESS WIRE)--Approved Freight Forwarders announced today their selection by Inbound Logistics Magazine for the 'Top 100 3PL Provider' list for the fifth consecutive year. Approved provides logistics, warehousing and freight forwarding services worldwide.

The staff at Inbound Logistics chose Approved Freight from more than 300 logistics industry leaders. The prestigious annual award recognizes the best logistics and supply chain solutions providers in the world. Since 1991, Approved Freight Forwarders has provided complex freight solutions to meet a changing world.

"It's an honor to be selected among the leaders in logistics and supply chain management by Inbound Logistics magazine again this year," said Eric Zybura, CEO, Approved Freight. "This fifth award highlights our entire team's consistent commitment to excellence in everything we do."

Approved Freight supports the Guam and Hawaii markets, and now serves as a critical freight transportation link to the entire world. Their logistics team provides ocean freight consolidations, air freight and over-the-road transport. Approved is the only Hawaii freight forwarder with terminals on all major islands, with more than 300,000 square feet of warehousing space.

"When choosing the 2020 Top 3PL Providers, our editors looked for providers who offer the visibility, flexibility, speed, and control that drive the supply chain solutions our audience needs to achieve their goals," said Felecia Stratton, Editor, Inbound Logistics. "We are proud to honor Approved Freight Forwarders for innovative solutions empowering logistics and supply chain excellence in 2020."

About Approved Freight Forwarders

Approved Freight Forwarders is part of The DeWitt Companies, a family of five sister companies that provides relocation, logistics, warehousing and freight forwarding services to businesses, households and military customers worldwide. With wholly-owned assets in Alaska, Hawaii, Guam and the Mainland, the company's customers trust Approved Freight Forwarders for easy, affordable, and safe transportation of goods. Besides overseas and domestic relocation services, the company provides office and industrial moving, large installation projects and air and ocean freight services. www.approvedforwarders.com/

About Inbound Logistics

Inbound Logistics, the demand-driven logistics magazine, is the leading multi-channel content provider targeted toward business logistics and supply chain managers. Inbound Logistics' mission is to help companies of all sizes better manage corporate resources by speeding and reducing inventory and supporting infrastructure, and better matching demand signals to supply lines. More information is available at www.inboundlogistics.com.


Contacts

Michael Cameron
This email address is being protected from spambots. You need JavaScript enabled to view it.
619-884-8985

HOUSTON--(BUSINESS WIRE)--Amur Gas Chemical Complex, LLC (“AGCC”), the project being implemented by SIBUR, the largest integrated petrochemicals company in Russia, has selected Univation Technologies’ UNIPOL™ PE Process for three world-scale PE reactor lines. These three lines will be incorporated into a world-scale, integrated project that also includes two additional SIBUR petrochemical production lines under design and construction near Svobodny town, Amur region, in the Far East of the Russian Federation. The combined manufacturing assets underneath the Gas Chemical Complex project will contribute to a total polyolefin design capacity of 2,700,000 TPY.


With dual objectives of creating significant PE capacity while also maximizing PE production flexibility, AGCC will construct three world-scale UNIPOL™ PE Process lines including two 600,000 TPY full-density plants for HDPE/LLDPE production and a single 600,000 TPY line focused on a broad range of both bimodal and unimodal HDPE production. The three lines achieve a combined total UNIPOL™ PE Process design capacity of 1,800,000 TPY.

AGCC will utilize Univation’s most advanced product technology platforms for both HDPE and LLDPE production, including ACCLAIM™ Technology for unimodal HDPE, PRODIGY™ Technology for bimodal HDPE, and XCAT™ Technology for advanced metallocene LLDPE. With these capabilities, AGCC plans to capture a full-range of HDPE, LLDPE and metallocene LLDPE product opportunities, which includes both conventional large-volume products as well as specialty applications.

AGCC will employ Univation’s advanced software platforms for both process control capability and virtual process training tools. Univation’s process control software, PREMIER™ APC+, delivers state-of-the-art process control capability designed to maximize production rates, facilitate rapid product transitions and enhance overall operational reliability of the UNIPOL™ PE Process. Univation’s UNIPOL™ PE Virtual Plant Simulator (UVPS) Software will provide AGCC’s operating staff a life-like training environment by simulating the look and feel of all key operational aspects of a UNIPOL™ PE Plant to deliver a highly realistic training experience.

“The Amur Gas Chemical Complex represents a significant investment in world-scale petrochemical production capability – and we are pleased to collaborate with SIBUR on their three polyethylene lines which will provide considerable supply benefits for both regional and global markets,” stated Dr. Steven F. Stanley, President of Univation Technologies. Dr. Stanley continued, “UNIPOL™ PE Technology delivers essential elements for a project of this magnitude including proven world-scale capacity designs, long-term manufacturing economic advantages derived from lower initial investment and low on-going operating costs, and highly flexible PE production capabilities to both anticipate and meet ever evolving application requirements within the PE market.”

Sergey Komyshan, Management Board Member – Executive Director of Petrochemicals at SIBUR, added his comments, “The Amur GCC project represents a significant step towards SIBUR’s transformation into a global-level petrochemical company. This strategic project signifies a key investment commitment directed at creating new world-scale polyolefin manufacturing capabilities and contributing to unlocking Russia’s huge non-commodity export potential. Univation’s UNIPOL™ PE Technology was a natural choice given their long history of PE industry experience, the breadth of their PE technology know-how, and the proven track record of delivering large capacity projects while meeting all the critical performance objectives. SIBUR is committed to forging close working relationships with the Univation team as together we bring these three world-scale PE lines into production to satisfy our customers’ growing polyethylene demand in both Asian and Russian markets.”

About Univation Technologies, LLC

Univation Technologies is the global leader in licensed polyethylene technology. Univation has a proven track record of delivering process, product and catalyst technologies as well as related technical services to the global polyethylene industry for more than 50 years. More than one-third of all HDPE and LLDPE resins produced globally is supplied by the industry-leading UNIPOL™ PE Process. Univation is also the world's leading manufacturer and supplier of conventional and advanced polyethylene polymerization catalysts designed specifically for the UNIPOL™ PE Process. For more information, visit www.univation.com.

UNIVATION, XCAT, PRODIGY, PREMIER, ACCLAIM, stylized “Univation Technologies”, and the stylized "U" are registered trademarks (Reg. U.S. Pat. and Tm. Off. and other countries) of Univation Technologies. UNIPOL is a trademark of The Dow Chemical Company (“Dow”) or an affiliated company of Dow, licensed for use to Univation Technologies.

About SIBUR

SIBUR is the leader of the Russian petrochemical industry and one of the largest companies globally in this sector, with more than 23,000 employees. The Company’s unique vertically integrated business model allows it to create highly competitive products consumed in the chemical, fast moving consumer goods (FMCG), automotive, construction, energy and other industries in 90 countries worldwide.

SIBUR helps to reduce CO2 emissions stemming from the burning of oil extraction by-products, such as associated petroleum gas (APG), by recycling them instead. In 2020, SIBUR processed 22.6 billion cubic meters of APG, thus cutting greenhouse emissions by 72 million tonnes, which is equivalent to the annual CO2 footprint of a middle-sized European country.

In 2020, SIBUR reported revenue of USD 8.2 billion and EBITDA of USD 2.6 billion. Over the past 10 years, SIBUR has implemented a number of large-scale investment projects worth more than RUB 1 trillion.


Contacts

Univation Technologies, LLC
Duane Thompson
+1-713-892-3668
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

SIBUR
Anna Lebed
International Media Relations of SIBUR
Cell: +7 (926) 754 08 51
E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.
www.sibur.ru

DUBLIN--(BUSINESS WIRE)--The "Global Artificial Lift Systems Market 2020-2024" report has been added to ResearchAndMarkets.com's offering.


The artificial lift systems market is poised to grow by $ 4.26 bn during 2020-2024, progressing at a CAGR of 5% during the forecast period.

The report on the artificial lift systems market provides a holistic analysis, market size and forecast, trends, growth drivers, and challenges, as well as vendor analysis covering around 25 vendors.

The report offers an up-to-date analysis regarding the current global market scenario, latest trends and drivers, and the overall market environment. The market is driven by the growing demand for oil and natural gas, enhanced production requirements in mature fields, and increase in production activities in deepwater, ultra-deep offshore, and heavy-oil. In addition, growing demand for oil and natural gas is anticipated to boost the growth of the market as well.

This study identifies the increasing use of automation and remote technology as one of the prime reasons driving the artificial lift systems market growth during the next few years. Also, increasing subsea operations, and increasing adaptation to non-conventional energy sources in Europe will lead to sizable demand in the market.

The robust vendor analysis is designed to help clients improve their market position, and in line with this, this report provides a detailed analysis of several leading artificial lift systems market vendors that include Apergy Corp., Baker Hughes Co., Dover Corp., Halliburton Co., National Oilwell Varco Inc., NOW Inc., OiLSERV, Rockwell Automation Inc., Schlumberger Ltd., and Weatherford International Plc.

Also, the artificial lift systems market analysis report includes information on upcoming trends and challenges that will influence market growth. This is to help companies strategize and leverage on all forthcoming growth opportunities.

Key Topics Covered:

Executive Summary

  • Market Overview

Market Landscape

  • Market ecosystem
  • Value chain analysis

Market Sizing

  • Market definition
  • Market segment analysis
  • Market size 2019
  • Market outlook: Forecast for 2019 - 2024

Five Forces Analysis

  • Five forces summary
  • Bargaining power of buyers
  • Bargaining power of suppliers
  • Threat of new entrants
  • Threat of substitutes
  • Threat of rivalry
  • Market condition

Market Segmentation by End-user

  • Market segments
  • Comparison by End-user
  • Onshore oil and gas industry - Market size and forecast 2019-2024
  • Offshore oil and gas industry - Market size and forecast 2019-2024
  • Market opportunity by End-user

Market Segmentation by Type

  • Market segments
  • Comparison by Type
  • ESP systems - Market size and forecast 2019-2024
  • RLP systems - Market size and forecast 2019-2024
  • PCP systems - Market size and forecast 2019-2024
  • Others - Market size and forecast 2019-2024
  • Market opportunity by Type

Customer Landscape

Geographic Landscape

  • Geographic segmentation
  • Geographic comparison
  • North America - Market size and forecast 2019-2024
  • Europe - Market size and forecast 2019-2024
  • APAC - Market size and forecast 2019-2024
  • MEA - Market size and forecast 2019-2024
  • South America - Market size and forecast 2019-2024
  • Key leading countries
  • Market opportunity by geography
  • Market drivers
  • Market challenges
  • Market trends

Vendor Landscape

  • Vendor landscape
  • Landscape disruption
  • Competitive scenario

Vendor Analysis

  • Vendors covered
  • Market positioning of vendors
  • Apergy Corp.
  • Baker Hughes Co.
  • Dover Corp.
  • Halliburton Co.
  • National Oilwell Varco Inc.
  • NOW Inc.
  • OiLSERV
  • Rockwell Automation Inc.
  • Schlumberger Ltd.
  • Weatherford International Plc

Appendix

For more information about this report visit https://www.researchandmarkets.com/r/8z3dt4


Contacts

ResearchAndMarkets.com
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