THE WOODLANDS,
Texas, Feb. 24, 2025 /PRNewswire/ -- Target
Hospitality Corp. ("Target Hospitality", "Target" or the "Company")
(Nasdaq: TH), one of North
America's largest providers of vertically integrated modular
accommodations and value-added hospitality services, received
notice that the U.S. government intends to terminate the existing
Pecos Children's Center ("PCC") services agreement with Target's
nonprofit partner ("NP Partner"), effective immediately, or on or
about February 21, 2025 ("Effective
Date").
Target provided facility and hospitality
solutions to the NP Partner through a lease and services agreement
("PCC Contract") utilizing Target's owned modular assets and real
property, capable of supporting up to 6,000 individuals. As
previously disclosed, the NP Partner may terminate the PCC Contract
with the Company for convenience. The NP Partner has provided
notice to Target of their intention to terminate the PCC Contract
as of the Effective Date.
Target will retain ownership of these assets,
enabling the Company to continue utilizing these modular solutions
and real property to support customer demand across its existing
operating segments and other potential growth
opportunities.
Target is actively engaged in re-marketing these
assets, along with other existing modular solutions, as it pursues
a strong pipeline of growth opportunities. These opportunities
include a growing number of potential solutions supporting the U.S.
government's current immigration policies, including utilizing the
Company's previously leased assets located in Dilley,
Texas.
Given the notice of termination of the PCC
Contract, the Company is withdrawing its previously issued
preliminary 2025 financial outlook. Target intends to provide
operational and financial updates, giving effect to the termination
of the PCC Contract, in the near term.
About Target Hospitality
Target Hospitality is one of North America's largest providers of
vertically integrated modular accommodations and value-added
hospitality services in the United
States. Target builds, owns and operates a customized and
growing network of communities for a range of end users through a
full suite of value-added solutions including premium food service
management, concierge, laundry, logistics, security and
recreational facilities services.
Cautionary Statement Regarding Forward Looking
Statements
Certain statements made in this press release
(including the financial outlook contained herein) are "forward
looking statements" within the meaning of the "safe harbor"
provisions of the United States Private Securities Litigation
Reform Act of 1995. When used in this press release, the words
"estimates," "projected," "expects," "anticipates," "forecasts,"
"plans," "intends," "believes," "seeks," "may," "will," "should,"
"future," "propose" and variations of these words or similar
expressions (or the negative versions of such words or expressions)
are intended to identify forward-looking statements. These
forward-looking statements are not guarantees of future
performance, conditions or results, and involve a number of known
and unknown risks, uncertainties, assumptions and other important
factors, many of which are outside our control, that could cause
actual results or outcomes to differ materially from those
discussed in the forward-looking statements. Important factors,
among others, that may affect actual results or outcomes include:
operational, economic, including inflation, political and
regulatory risks; our ability to effectively compete in the
specialty rental accommodations and hospitality services industry,
including growing the HFS – South and Government segments;
effective management of our communities; natural disasters and
other business disruptions, including outbreaks of epidemic or
pandemic disease; the duration of any future public health crisis,
related economic repercussions and the resulting negative impact to
global economic demand; the effect of changes in state building
codes on marketing our buildings; changes in demand within a number
of key industry end-markets and geographic regions; changes in
end-market demand requirements including variable occupancy levels
associated with subcontracts in the Government segment; our
reliance on third party manufacturers and suppliers; failure to
retain key personnel; increases in raw material and labor costs;
the effect of impairment charges on our operating results; our
future operating results fluctuating, failing to match performance
or to meet expectations; our exposure to various possible claims
and the potential inadequacy of our insurance; unanticipated
changes in our tax obligations; our obligations under various laws
and regulations; the effect of litigation, judgments, orders,
regulatory or customer bankruptcy proceedings on our business; our
ability to successfully acquire and integrate new operations;
global or local economic and political movements, including any
changes in policy under the Trump administration or any future
administration; federal government budgeting and appropriations;
our ability to effectively manage our credit risk, liquidity and
collect on our accounts receivable; our ability to fulfill Target
Hospitality's public company obligations; any failure of our
management information systems; our ability to refinance debt
on favorable terms and meet our debt service requirements and
obligations; and risks related to our outstanding obligations in
connection with the Senior Notes. We undertake no obligation
to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, except as
required by law.
Investor Contact
Mark Schuck
(832) 702 – 8009
ir@targethospitality.com
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SOURCE Target Hospitality
