Capitalization
Enterprise Value
Free Cash Flow
Market Capitalization
Net Capital Employed
Net Debt
EBITDA
Adjusted Net Income Per Share
3Q 2011 Results Excluding Maritech
Capitalization
Capitalization is defined as total TETRA stockholders' equity plus long-term debt and the current portion of long-term debt. A reconciliation as of September 30, 2011, December 31, 2010 and December 31, 2009 is shown below:
| |
Sept. 30, 2011 |
|
Dec. 31, 2010 |
|
Dec. 31, 2009 |
|
| |
(In Thousands) |
|
|
Total TETRA stockholders' equity
|
$552,336 |
|
$516,323 |
|
$576,494 |
|
|
Long-term debt
|
305,035 |
|
305,035 |
|
310,132 |
|
|
Current portion of long-term debt
|
- |
|
- |
|
- |
|
|
Capitalization
|
$857,371 |
|
$821,358 |
|
$886,626 |
|
|
|
|
|
|
|
|
|
Enterprise Value
Enterprise Value is defined as market capitalization plus the sum of long-term and short-term debt on the consolidated balance sheet, less cash, excluding restricted cash on the consolidated balance sheet and excluding the debt and cash of Compressco Partners, L.P. Conceptually, Enterprise Value is a measure of the market value of a company if it were free of debt. A reconciliation as of September 30, 2011, December 31, 2010 and December 31, 2009 is shown below:
| |
Sept. 30, 2011 |
|
Dec. 31, 2010 |
|
Dec. 31, 2009 |
|
| |
(In Thousands) |
|
|
Market capitalization
|
$590,711 |
|
$896,648 |
|
$831,499 |
|
|
Total debt
|
305,035 |
|
305,035 |
|
310,132 |
|
|
Less: cash, excluding
Compressco Partners' cash
|
(205,322 |
)
|
(65,360 |
)
|
(33,394 |
) |
|
Enterprise value
|
$690,424 |
|
$1,136,323 |
|
$1,108,237 |
|
|
|
|
|
|
|
|
|
Free Cash Flow
Free Cash Flow is defined as cash provided by operating activities minus cash used in investing activities (from the consolidated statements of cash flows). Cash provided by operating activities consists of net income, plus depreciation, depletion and amortization, plus the change in deferred income taxes, plus other non-cash items, plus changes in working capital, plus other changes in current operating assets and liabilities. Cash used in investing activities includes capital expenditures, acquisitions, and other cash used in investing activities. Management views Free Cash Flow, a non-GAAP measure, as a measure of TETRA's after-tax cash flow available to reduce debt, add to cash balances, pay dividends, repurchase stock, and fund other financing activities. A reconciliation of cash provided by operating activities to Free Cash Flow for the nine months ended September 30, 2011, and the years ended December 31, 2010 and December 31, 2009 is shown below:
| |
9 Mos Ended
Sept. 30, 2011 |
|
Year Ended
Dec. 31, 2010 |
|
Year Ended Dec. 31, 2009 |
|
| |
(In Thousands) |
|
|
Cash provided by operating activities
|
$48,383 |
|
$153,325 |
|
$272,315 |
|
|
Cash provided by (used in) investing activities
|
60,100 |
|
(115,886 |
)
|
(149,699 |
)
|
|
Free cash flow
|
$108,483 |
|
$37,439 |
|
$122,616 |
|
|
|
|
|
|
|
|
|
Market Capitalization
Market Capitalization is defined as the price per share of stock at the end of a period multiplied by the average number of shares outstanding as reported in the Company's most recently filed Form 10-K or Form 10-Q. A reconciliation as of September 30, 2011, December 31, 2010 and December 31, 2009 is shown below:
| |
Sept. 30, 2011 |
|
Dec. 31, 2010 |
|
Dec. 31, 2009 |
|
| |
(In Thousands, Except Per Share Amounts)
|
|
|
Stock price per share at end of period
|
$7.72 |
|
$11.87 |
|
$11.08 |
|
|
Average number of shares outstanding
|
76,517 |
|
75,539 |
|
75,045 |
|
|
Market capitalization
|
$590,711 |
|
$896,648 |
|
$831,499 |
|
|
|
|
|
|
|
|
|
Net Capital Employed
Net Capital Employed is defined as total TETRA stockholders' equity plus the sum of long-term and short-term debt on the consolidated balance sheet, plus decommissioning and other asset retirement obligations and the current portion of decommissioning and other asset retirement obligations, less cash, excluding restricted cash on the consolidated balance sheet and excluding the debt and cash of Compressco Partners, L.P. A reconciliation as of September 30, 2011, December 31, 2010 and December 31, 2009 is shown below:
| |
Sept. 30, 2011 |
|
Dec. 31, 2010 |
|
Dec. 31, 2009 |
|
|
(In Thousands) |
|
Total TETRA stockholders' equity
|
$552,336 |
|
$516,323 |
|
$576,494 |
|
|
Total debt
|
305,035 |
|
305,035 |
|
310,132 |
|
| Decommissioning and other asset retirement obligations |
24,566 |
|
200,550 |
|
146,219 |
|
| Current portion of decommissioning and other asset retirement obligations |
109,029 |
|
72,265 |
|
77,891 |
|
|
Less: cash, excluding
Compressco Partners' cash
|
(205,332 |
)
|
(65,360 |
)
|
(33,394 |
) |
|
Net capital employed
|
$785,644 |
|
$1,028,813 |
|
$1,077,342 |
|
|
|
|
|
|
|
|
|
Net Debt
Net debt is defined as the sum of long-term and short-term debt on the consolidated balance sheet, less cash, excluding restricted cash on the consolidated balance sheet and excluding the debt and cash of Compressco Partners, L.P. Management views net debt as a measure of the Company’s ability to reduce debt, add to cash balances, pay dividends, repurchase stock, and fund investing and financing activities.as total debt minus cash. A reconciliation of total debt to net debt as of September 30, 2011, December 31, 2010 and December 31, 2009 is shown below:
| |
Sept. 30, 2011 |
|
Dec. 31, 2010 |
|
Dec. 31, 2009 |
|
| |
(In Thousands) |
|
|
Total debt
|
$305,035 |
|
$305,035 |
|
$310,132 |
|
|
Less: cash, excluding
Compressco Partners' cash
|
(205,322 |
)
|
(65,360 |
)
|
(33,394 |
)
|
|
Net debt
|
$99,713 |
|
$239,675 |
|
$276,738 |
|
|
|
|
|
|
|
|
|
EBITDA
EBITDA is defined as net income (loss) attributable to TETRA stockholders plus net interest expense, plus income tax provision, plus depreciation, depletion, amortization, accretion and impairments. Management views EBITDA, a non-GAAP measure, as a measure of operating performance without regard to items such as interest expense, taxes, depreciation, depletion and amortization, which can vary substantially from company to company. A reconciliation of EBITDA to net income attributable to TETRA stockholders as of December 31, 2010, December 31, 2009 and December 31, 2008, and a reconciliation of trailing twelve month EBITDA to net income attributable to TETRA stockholders as of September 30, 2011, is shown below:
| |
Year Ended |
| |
Dec. 31, 2010 |
|
Dec. 31, 2009
|
|
Dec. 31, 2008 |
|
| |
(In Thousands) |
|
|
Net income (loss) attributable to TETRA stockholders
|
$(43,718 |
)
|
$68,804 |
|
$(12,136 |
)
|
|
Net interest expense
|
17,304 |
|
12,790
|
|
16,778 |
|
|
Income tax provision (benefit)
|
(30,468 |
) |
36,563
|
|
5,740 |
|
|
Depreciation, depletion, amortization, accretion and impairments
|
236,889 |
|
162,317
|
|
210,292 |
|
|
EBITDA
|
$180,007 |
|
$280,474
|
|
$220,674 |
|
|
|
|
|
|
|
|
|
| |
TTM as of |
|
EBITDA for the three months ended |
| |
Sept. 30, 2011 |
|
Sept. 30, 2011 |
|
June 30, 2011 |
|
Mar. 31, 2011 |
|
Dec. 31, 2010 |
|
| |
(In Thousands) |
|
Net income (loss) attributable to TETRA stockholders
|
$(34,629 |
)
|
$1,387 |
|
$30,374 |
|
$(2,515 |
)
|
$(65,875 |
)
|
|
Net interest expense
|
16,915 |
|
4,085 |
|
4,085 |
|
4,191 |
|
4,554 |
|
|
Income tax provision (benefit)
|
(23,624 |
)
|
870 |
|
17,031 |
|
(1,529 |
)
|
(39,996 |
)
|
|
Depreciation, depletion, amortization, accretion and impairments
|
192,645 |
|
16,226 |
|
36,937 |
|
37,392 |
|
102,090 |
|
|
EBITDA
|
$152,307 |
|
$22,568 |
|
$88,427 |
|
$37,539 |
|
$3,773 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income Per Share
GAAP net income (loss) before discontinued operations is reconciled to non-GAAP adjusted net income per diluted share for the three months ended December 31, 2010 and 2009, and the years ended December 31, 2010 and 2009, as shown in our February 25, 2011 press release.
| |
|
Three Months Ended
|
|
|
Year Ended
|
|
| |
|
December 31,
|
|
|
December 31,
|
|
| |
|
2010
|
|
|
2009
|
|
|
2010
|
|
|
2009
|
|
| |
|
(In Thousands, Except Per Share Amounts)
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income (loss) before
|
|
|
|
|
|
|
|
|
|
|
|
|
|
discontinued operations
|
|
$ |
(62,603 |
) |
|
$ |
25,415 |
|
|
$ |
(43,325 |
) |
|
$ |
68,807 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maritech impairments and other charges
|
|
|
80,194 |
|
|
|
16,280 |
|
|
|
117,771 |
|
|
|
35,181 |
|
|
Gain on insurance settlement
|
|
|
(850 |
) |
|
|
(39,950 |
) |
|
|
(2,541 |
) |
|
|
(45,391 |
) |
|
Impairment of long-lived assets
|
|
|
24,185 |
|
|
|
989 |
|
|
|
25,093 |
|
|
|
8,121 |
|
|
Legal settlement
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(5,721 |
) |
|
Make-whole payment on senior debt and other
|
|
|
5,001 |
|
|
|
931 |
|
|
|
5,001 |
|
|
|
931 |
|
|
Total pretax non-GAAP adjustments
|
|
|
108,530 |
|
|
|
(21,750 |
) |
|
|
145,324 |
|
|
|
(6,879 |
) |
|
Tax effects of non-GAAP adjustments
|
|
|
(38,465 |
) |
|
|
7,747 |
|
|
|
(52,025 |
) |
|
|
2,570 |
|
|
Non-GAAP adjusted income before
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
discontinued operations
|
|
$ |
7,462 |
|
|
$ |
11,412 |
|
|
$ |
49,974 |
|
|
$ |
64,498 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income (loss) before discontinued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
operations per diluted share
|
|
$ |
(0.83 |
) |
|
$ |
0.33 |
|
|
$ |
(0.57 |
) |
|
$ |
0.91 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maritech impairments and other charges
|
|
|
1.04 |
|
|
|
0.21 |
|
|
|
1.53 |
|
|
|
0.46 |
|
|
Gain on insurance settlement
|
|
|
(0.01 |
) |
|
|
(0.52 |
) |
|
|
(0.03 |
) |
|
|
(0.60 |
) |
|
Impairment of long-lived assets
|
|
|
0.32 |
|
|
|
0.02 |
|
|
|
0.33 |
|
|
|
0.11 |
|
|
Legal settlement
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(0.07 |
) |
|
Make-whole payment on senior debt and other
|
|
|
0.07 |
|
|
|
0.01 |
|
|
|
0.07 |
|
|
|
0.01 |
|
|
Tax effects of non-GAAP adjustments
|
|
|
(0.49 |
) |
|
|
0.10 |
|
|
|
(0.68 |
) |
|
|
0.03 |
|
|
Non-GAAP adjusted income before discontinued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
operations per diluted share
|
|
$ |
0.10 |
|
|
$ |
0.15 |
|
|
$ |
0.65 |
|
|
$ |
0.85 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in calculating diluted earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
per share
|
|
|
77,054 |
|
|
|
76,410 |
|
|
|
76,829 |
|
|
|
75,722 |
|
GAAP net income per diluted share is reconciled to the non-GAAP measure "adjusted net income per diluted share" for the fourth quarter and year 2007, as those terms are used in our February 26, 2008 press release.
Please click here to view the financial table.
3Q 2011 Results Excluding Maritech
In its November 4, 2011 press release announcing third quarter 2011 results, as a supplement to financial results prepared in accordance with GAAP the Company provided the following tables which contain results excluding the impact of Maritech. The tables also include reconciliations of revenues excluding Maritech, gross profit excluding Maritech, income before taxes excluding Maritech and oil and gas derivative ineffectiveness, and diluted per share information excluding Maritech and oil and gas derivative ineffectiveness to the appropriate GAAP financial measures. The Company’s management views revenues excluding Maritech, gross profit excluding Maritech, income before taxes excluding Maritech and oil and gas derivative ineffectiveness, and diluted per share information excluding Maritech and oil and gas derivative ineffectiveness as appropriate measures to evaluate its results of operations following the sales of Maritech oil and gas producing properties that occurred during the first eight months of 2011. These non-GAAP financial measures may not be comparable to similarly titled measures used by other companies and should not be used as a substitute for revenues, gross profit, income before taxes, earnings per share or other measures of financial performance presented in accordance with GAAP. Reconciliations of revenues excluding Maritech, gross profit excluding Maritech, income before taxes excluding Maritech and oil and gas derivative ineffectiveness, and diluted per share information excluding Maritech and oil and gas derivative ineffectiveness for the three and nine month periods ended September 30, 2011 and September 30, 2010 are provided below. These results have not been adjusted to exclude the $3.4 million charge to earnings by our Offshore Services segment primarily associated with preparation activities for the TETRA Hedron vessel during the three month period ended September 30, 2011.
| |
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
| |
|
September 30,
|
|
|
September 30,
|
|
| |
|
2011
|
|
|
2010
|
|
|
2011
|
|
|
2010
|
|
| |
|
(In Thousands, Except Per Share Amounts)
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated revenues
|
|
$ |
201,434 |
|
|
$ |
211,918 |
|
|
$ |
659,093 |
|
|
$ |
659,429 |
|
|
Less: Maritech revenues
|
|
|
(1,945 |
) |
|
|
(48,583 |
) |
|
|
(79,349 |
) |
|
|
(145,552 |
) |
|
Consolidated revenues excluding Maritech
|
|
$ |
199,489 |
|
|
$ |
163,335 |
|
|
$ |
579,744 |
|
|
$ |
513,877 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated gross profit
|
|
$ |
35,668 |
|
|
$ |
28,779 |
|
|
$ |
97,845 |
|
|
$ |
111,705 |
|
|
Less: Maritech gross (profit) loss
|
|
|
14,369 |
|
|
|
13,070 |
|
|
|
33,683 |
|
|
|
2,273 |
|
|
Consolidated gross profit excluding Maritech
|
|
$ |
50,037 |
|
|
$ |
41,849 |
|
|
$ |
131,528 |
|
|
$ |
113,978 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated income before taxes and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
discontinued operations
|
|
$ |
2,830 |
|
|
$ |
(204 |
) |
|
$ |
46,343 |
|
|
$ |
28,806 |
|
|
Less: Maritech (income) loss before taxes
|
|
|
15,605 |
|
|
|
14,260 |
|
|
|
(18,398 |
) |
|
|
4,573 |
|
|
Less: Derivative ineffectiveness
|
|
|
- |
|
|
|
108 |
|
|
|
13,947 |
|
|
|
(232 |
) |
|
Consolidated income before taxes and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
discontinued operations excluding Maritech and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
derivative ineffectiveness
|
|
$ |
18,435 |
|
|
$ |
14,164 |
|
|
$ |
41,892 |
|
|
$ |
33,147 |
|
|
Diluted per share information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to TETRA stockholders
|
|
$ |
0.02 |
|
|
$ |
0.00 |
|
|
$ |
0.37 |
|
|
$ |
0.25 |
|
|
(Income) loss for Maritech
|
|
|
0.13 |
|
|
|
0.12 |
|
|
|
(0.15 |
) |
|
|
0.04 |
|
|
(Income) loss for derivative ineffectiveness
|
|
|
- |
|
|
|
0.00 |
|
|
|
0.11 |
|
|
|
(0.00 |
) |
|
Net income attributable to TETRA stockholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
excluding Maritech and derivative ineffectiveness
|
|
$ |
0.15 |
|
|
$ |
0.12 |
|
|
$ |
0.33 |
|
|
$ |
0.29 |
|
|
