U.S. Well Services, Inc. (the “Company”, “U.S. Well Services” or
“we”) (NASDAQ: USWS) today reported first quarter 2020 financial
and operational results.
First Quarter 2020
Highlights
- Finalized a long-term contract with
EQT Corporation in April 2020 to provide electric fracturing
services in the Northeast beginning in January 2020 for up to three
years if all optional extensions are exercised
- Raised $21 million of Series B
Redeemable Convertible Preferred Equity issued on April 1,
2020
- Amended terms of ABL Credit
Facility and Senior Secured Term Loan, extending maturities by 12
months and 18 months, respectively, and eliminated scheduled
principal amortization and interest payments on the Senior Secured
Term Loan for 24 months
- Proactively implemented cost
cutting initiatives and recorded a $9.0 million provision for
doubtful collections of accounts receivable in light of current
market conditions
- Averaged 8.9 fully-utilized fleets
compared to 6.8 fully-utilized fleets during the fourth quarter of
2019
- Total revenue of $112.0 million
compared to $92.7 million in the fourth quarter of 2019
- Net loss attributable to the
Company of $172.4 million compared to net loss of $33.2 million in
the fourth quarter of 2019
- Adjusted EBITDA(1) of $12.7
million, or $21.8 million as adjusted for the provision for
doubtful collections, compared to $12.1 million in the fourth
quarter of 2019
- Reported annualized Adjusted EBITDA
per fully-utilized fleet of $5.7 million, or $9.8 million before
provision for doubtful collections, compared to $7.1 million for
the fourth quarter of 2019(2)
- After deduction of fluid end
maintenance capital expenditures, annualized Adjusted EBITDA per
fully-utilized fleet was $4.3 million compared to $6.3 million for
the fourth quarter of 2019
- Total liquidity, consisting of cash
and availability under the Company’s asset-backed revolving credit
facility, was $22.4 million as of March 31, 2020
- Each of Adjusted EBITDA and
Adjusted EBITDA margin is a Non-GAAP financial measure. Please read
“Non-GAAP Financial Measures.”
- Adjusted EBITDA per fully-utilized
fleet equivalent is defined as Adjusted EBITDA divided by the
product of average active fleets during the quarter and the
utilization rate for active fleets during the quarter.
“U.S. Well Services posted solid financial and
operational performance in spite of the significant slowdown in
activity that began in March due to onset of the COVID-19
pandemic,” said Joel Broussard, President and CEO of U.S. Well
Services. “I am pleased with the actions our team has taken
to safeguard the wellbeing of our employees and help the Company
weather the recent market turmoil, and I believe U.S. Well Services
remains positioned to be an industry leader as market activity
recovers.
“Our ability to execute new contracts for
electric hydraulic fracturing services in the midst of global
economic turmoil is a testament to U.S. Well Services’
differentiated hydraulic fracturing technology and demonstrated
track record for operational excellence. We are continuing to
work to deploy fleets at economical pricing while rationalizing
costs.”
Outlook
The rapid slowdown in global economic activity
in reaction to the COVID-19 pandemic has created both an
unprecedented collapse in demand for crude oil and a deteriorating
imbalance between global inventories and demand. In response,
U.S. E&P companies have not only significantly reduced
completions activity, but have also taken steps to shut in existing
production. Although U.S. Well Services expects that demand
and activity will recover from current levels, the duration of the
current market turmoil remains uncertain.
Beginning in late February, U.S. Well Services
took proactive measures to ensure the safety of its employees and
customers, as well as to reduce the Company’s cost structure in
order to preserve cash. During the first quarter, U.S. Well
Services made substantial headcount reductions and furloughs where
necessary, eliminated its 401(k) matching, and reduced compensation
company-wide, including 20% salary cuts for our senior management
and Board of Directors.
Subsequent to the first quarter of 2020, U.S.
Well Services completed an offering of 21,000 shares of Series B
Redeemable Convertible Preferred Equity generating net proceeds of
approximately $20.1 million. The Company also amended the
terms of its ABL Credit Facility and Senior Secured Term Loan in
order to maximize financial flexibility. Under the terms of
the amendments, the ABL Credit Facility’s maturity date was
extended by 12 months, the Senior Secured Term Loan’s maturity date
was extended by 18 months and interest and scheduled principal
repayments to the Senior Secured Term Loan lenders were suspended
for 24 months. In exchange for these amendments to the Senior
Secured Term Loan, U.S. Well Services paid a $20 million cash fee
and issued 1,050 shares of Series B Redeemable Convertible
Preferred Equity and 5.5 million shares of U.S. Well Services Class
A Common Equity to lenders under the Term Loan Facility.
First Quarter 2020 Financial
Summary
Revenue for the first quarter of 2020 increased
21% to $112.0 million versus $92.7 million in the fourth quarter of
2019, driven by an increase in the number of active fleets.
U.S. Well Services averaged 10.7 active fleets during the quarter,
as compared to 8.0 for the fourth quarter of 2019.
Utilization of the Company’s active fleets averaged 84% during the
first quarter, resulting in a fully-utilized equivalent of 8.9
fleets. This compares to 84% utilization and a fully-utilized
equivalent of 6.8 fleets for the fourth quarter of 2019.
Costs of services, excluding depreciation and
amortization, for the first quarter of 2020 increased to $85.2
million from $76.1 million during the fourth quarter of 2019,
primarily as a result of higher activity levels and an increase in
consumables provided to customers, including sand, chemicals and
sand transportation.
Selling, general and administrative expense
(“SG&A”) increased to $19.1 million in the first quarter of
2020 from $7.4 million in the fourth quarter of 2019. In light of
the recent collapse in crude oil pricing, U.S. Well Services
recorded an expense of $9.0 million to reserve for doubtful
collections of accounts receivable. Excluding severance,
stock-based compensation and the provision for losses on accounts
receivable, SG&A in the first quarter of 2020 was $8.4 million
compared to $6.1 million in the fourth quarter of 2019. This
sequential increase was primarily attributable to an increase in
compensation and professional fees related to litigation.
As a result of the significant deterioration in
market conditions, U.S. Well Services performed an impairment test
in the first quarter of 2020 and determined that the carrying value
of long-lived assets exceeded their fair value. The Company
recorded an impairment of $147.5 million, consisting of a $7.2
million charge to reduce the carrying value of intangible assets
and a $140.3 million charge to reduce the carrying value of
property and equipment.
Net loss attributable to the Company increased
sequentially to $172.4 million in the first quarter of 2020 from
$33.2 million in the fourth quarter of 2019, driven primarily by
the impairment of long-lived assets. Adjusted EBITDA
increased 5% in the first quarter of 2020 to $12.7 million from
$12.1 million in the fourth quarter of 2019. Adjusted EBITDA
excluding provisions for doubtful collections of accounts
receivable was $21.8 million, or $9.8 million per fully-utilized
fleet. Adjusted EBITDA margin decreased to 11% from 13% in
the fourth quarter of 2019.(1)
Operational Highlights
U.S. Well Services exited the first quarter with
4 active frac fleets, with two fleets in the Appalachian Basin, one
fleet in the Eagle Ford and one fleet in the Permian
Basin.
U.S. Well Services’ operating efficiency
improved sequentially, with stage count per fully-utilized fleet
increasing by approximately 2%, completing 5,006 frac stages during
the first quarter of 2020, or 562 stages per fully-utilized fleet,
as compared to 3,726 frac stages, or 548 stages per fully-utilized
fleet, during the fourth quarter of 2019. Pumping hours per
day increased approximately 2% sequentially. USWS pumped for
9,361 hours during 742 frac days, as compared to 6,771 hours during
548 frac days in the fourth quarter of 2019.
U.S. Well Services continues to be the market
leader in electric fracturing, with 12,869 electric fracturing
stages completed since the deployment of our first Clean Fleet® in
2014. The Company continued to expand its intellectual
property portfolio during the first quarter, receiving a grant for
one additional patent, bringing our total granted patent portfolio
to 37 patents, with 129 patents pending.
Balance Sheet and Capital
Spending
As of March 31, 2020, total liquidity was $22.4
million, consisting of $9.6 million of cash on the Company’s
balance sheet and $12.8 million of availability under the Company’s
asset-backed revolving credit facility, and net debt was $306.0
million.
Capital expenditures, on an accrual basis, were
$23.3 million during the first quarter of 2020. The capital
expenditures consisted of $13.3 million for growth initiatives and
$10.0 million for maintenance capital expenditures, which equates
to an annualized rate of $4.5 million per fully-utilized fleet.
Maintenance capital expenditures during the first quarter of 2020
included approximately $3.1 million for fluid ends. In
connection with the Company’s review of impairment of long-lived
assets, U.S. Well Services determined that the useful life of its
fluid ends and fuel injectors was less than one year. As a
result, the costs associated with the replacement of these
components will no longer be capitalized, but instead expensed as
incurred. This change in accounting estimate was implemented
in March 2020 and was accounted for prospectively.
Conference Call Information
The Company will host a conference call at 4:00
pm Central / 5:00 pm Eastern Time on Monday, May 11, 2020 to
discuss financial and operating results for the first quarter of
2020 and recent developments. This call will also be webcast and an
investor presentation will be available on U.S. Well Services’
website at
http://ir.uswellservices.com/events-and-presentations/events.
To access the conference call, please dial 201-389-0872 and ask for
the U.S. Well Services call at least 10 minutes prior to the start
time or listen to the call live over the Internet by logging on to
the Company’s website from the link above. A telephonic
replay of the conference call will be available through May 18,
2020 and may be accessed by calling 201-612-7415 using passcode
13703536#. A webcast archive will also be available at the
link above shortly after the call and will be accessible for
approximately 90 days.
About U.S. Well Services,
Inc.
U.S. Well Services, Inc. is a leading provider
of hydraulic fracturing services and a market leader in electric
fracture stimulation. The Company’s patented electric frac
technology provides one of the first fully electric, mobile well
stimulation systems powered by locally supplied natural gas
including field gas sourced directly from the wellhead. The
Company’s electric frac technology dramatically decreases emissions
and sound pollution while generating exceptional operational
efficiencies including significant customer fuel cost savings
versus conventional diesel fleets. For more information visit:
www.uswellservices.com. The information on our website is not
part of this release.
Forward-Looking
Statements
The information above includes “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. All statements, other than statements of
historical facts, included herein concerning, among other things,
availability under the Company’s credit facilities, benefits
obtained from the Company’s strategic financing transactions, the
Company’s financial position and liquidity, business strategy and
objectives for future operations, results of discussions with
potential customers, benefits obtained from the Company’s
patent-pending PowerPath technology, potential new contract
opportunities and planned deployment and operation of fleets, are
forward-looking statements. These forward-looking statements may be
identified by their use of terms and phrases such as “may,”
“expect,” “guidance,” “estimate,” “project,” “plan,” “believe,”
“intend,” “achievable,” “anticipate,” “will,” “continue,”
“potential,” “should,” “could,” “target” and similar terms and
phrases. Although the Company believes that the expectations
reflected in these forward-looking statements are reasonable, they
do involve certain assumptions, risks and uncertainties. These
forward-looking statements represent the Company’s current
expectations or beliefs concerning future events, and it is
possible that the results described in this release will not be
achieved. These forward-looking statements are subject to certain
risks, uncertainties and assumptions, including those identified in
this release or disclosed from time to time in the Company’s
filings with the Securities and Exchange Commission (the “SEC”).
Factors that could cause actual results to differ from the
Company’s expectations include changes in market conditions,
changes in commodity prices, changes in supply and demand for oil
and gas, changes in demand for our services, availability of
financing and capital, the Company’s liquidity, the Company’s
compliance with covenants under its credit agreements, actions by
customers and potential customers, geopolitical events,
availability of equipment and personnel and other factors described
in the Company’s public disclosures and filings with the SEC,
including those described under “Risk Factors” in our annual report
on Form 10-K filed on March 14, 2019 and in our quarterly reports
on Form 10-Q. As a result of these factors, actual results may
differ materially from those indicated or implied by
forward-looking statements.
Any forward-looking statement speaks only as of
the date on which it is made, and, except as required by law, the
Company does not undertake any obligation to update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
-
Tables to Follow -
|
|
|
|
|
|
U.S. WELL SERVICES, INC. |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(unaudited and amounts in thousands except for active fleets and
per share amounts) |
|
|
|
Three Months |
|
March 31,2020 |
|
December 31,2019 |
|
March 31,2019 |
|
|
|
|
|
|
Statement of Operations Data: |
|
|
|
|
|
Revenue |
$ |
112,035 |
|
|
$ |
92,682 |
|
|
$ |
139,772 |
|
Costs and expenses: |
|
|
|
|
|
Cost of services (excluding depreciation and amortization) |
|
85,153 |
|
|
|
76,115 |
|
|
|
109,681 |
|
Depreciation and amortization |
|
32,008 |
|
|
|
36,260 |
|
|
|
37,844 |
|
Selling, general and administrative expenses |
|
19,058 |
|
|
|
7,382 |
|
|
|
8,620 |
|
Impairment loss on long-lived assets |
|
147,543 |
|
|
|
- |
|
|
|
- |
|
Loss on disposal of assets |
|
4,244 |
|
|
|
4,182 |
|
|
|
6,904 |
|
Loss from operations |
|
(175,971 |
) |
|
|
(31,257 |
) |
|
|
(23,277 |
) |
Interest expense, net |
|
(7,952 |
) |
|
|
(8,715 |
) |
|
|
(5,115 |
) |
Other income (expense) |
|
6 |
|
|
|
(7 |
) |
|
|
27 |
|
Loss before income taxes |
|
(183,917 |
) |
|
|
(39,979 |
) |
|
|
(28,365 |
) |
Income tax expense (benefit) |
|
(750 |
) |
|
|
(546 |
) |
|
|
124 |
|
Net loss |
|
(183,167 |
) |
|
|
(39,433 |
) |
|
|
(28,489 |
) |
Net loss attributable to noncontrolling interest |
|
(10,800 |
) |
|
|
(6,240 |
) |
|
|
(6,217 |
) |
Net loss attributable to U.S. Well Services, Inc. |
$ |
(172,367 |
) |
|
$ |
(33,193 |
) |
|
$ |
(22,272 |
) |
Dividends accrued on Series A preferred stock |
|
(1,751 |
) |
|
|
(1,720 |
) |
|
|
- |
|
Deemed and imputed dividends on Series A preferred stock |
|
(6,249 |
) |
|
|
(5,240 |
) |
|
|
- |
|
Net loss attributable to U.S. Well Services, Inc. common
stockholders |
$ |
(180,367 |
) |
|
$ |
(40,153 |
) |
|
$ |
(22,272 |
) |
|
|
|
|
|
|
Net loss attributable to U.S. Well Services, Inc. stockholders per
common share: |
|
|
Basic and diluted |
|
(3.00 |
) |
|
|
(0.74 |
) |
|
|
(0.45 |
) |
Weighted average common shares outstanding: |
|
|
|
|
|
Basic and diluted |
|
58,620 |
|
|
|
53,279 |
|
|
|
47,398 |
|
|
|
|
|
|
|
Other Financial and Operational Data |
|
|
|
|
|
Capital Expenditures (1) |
|
23,302 |
|
|
|
22,350 |
|
|
|
155,111 |
|
Adjusted EBITDA (2) |
|
12,748 |
|
|
|
12,138 |
|
|
|
27,984 |
|
Average Active Fleets |
|
10.7 |
|
|
|
8.0 |
|
|
|
11.0 |
|
|
|
|
|
|
|
(1) Capital expenditures presented above are shown on an accrual
basis, including capital expenditures in accounts payable, accrued
liabilities and under equipment financing arrangements. |
(2) Adjusted EBITDA is a Non-GAAP Financial Measure. See the tables
entitled "Reconciliation and Calculation of Non-GAAP Financial and
Operational Measures" below. |
|
|
|
|
|
|
|
U.S. WELL SERVICES, INC. |
CONDENSED CONSOLIDATED BALANCE SHEETS |
(unaudited, amounts in thousands except shares) |
|
|
|
|
|
|
|
Year Ended |
|
|
March 31, 2020 |
|
December 31, 2019 |
ASSETS |
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
Cash and cash equivalents |
|
$ |
9,068 |
|
|
$ |
33,794 |
|
Restricted cash |
|
|
519 |
|
|
|
7,610 |
|
Accounts receivable (net of allowance for doubtful accounts of
$9,000 and $22 as of March 31, 2020 and December 31, 2019,
respectively) |
|
|
89,853 |
|
|
|
79,542 |
|
Inventory, net |
|
|
9,619 |
|
|
|
9,052 |
|
Prepaids and other current assets |
|
|
12,386 |
|
|
|
13,332 |
|
Total current assets |
|
|
121,445 |
|
|
|
143,330 |
|
Property and equipment, net |
|
|
273,828 |
|
|
|
441,610 |
|
Intangible assets, net |
|
|
14,191 |
|
|
|
21,826 |
|
Goodwill |
|
|
4,971 |
|
|
|
4,971 |
|
Deferred financing costs, net |
|
|
1,164 |
|
|
|
1,045 |
|
TOTAL ASSETS |
|
$ |
415,599 |
|
|
$ |
612,782 |
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
Accounts payable |
|
$ |
75,063 |
|
|
$ |
70,170 |
|
Accrued expenses and other current liabilities |
|
|
18,492 |
|
|
|
40,481 |
|
Notes payable |
|
|
6,025 |
|
|
|
8,068 |
|
Current portion of long-term equipment financing |
|
|
2,755 |
|
|
|
5,564 |
|
Current portion of long-term capital lease obligation |
|
|
9,081 |
|
|
|
10,474 |
|
Current portion of long-term debt |
|
|
- |
|
|
|
6,250 |
|
Total current liabilities |
|
|
111,416 |
|
|
|
141,007 |
|
Long-term equipment financing |
|
|
12,002 |
|
|
|
10,501 |
|
Long-term debt |
|
|
285,752 |
|
|
|
274,391 |
|
Other long-term liabilities |
|
|
920 |
|
|
|
215 |
|
TOTAL LIABILITIES |
|
|
410,090 |
|
|
|
426,114 |
|
|
|
|
|
|
MEZZANINE EQUITY |
|
|
|
|
Series A Redeemable
Convertible Preferred Stock, par value $0.0001 per share; 55,000
shares authorized, issued and outstanding as of March 31, 2020 and
December 31, 2019; aggregate liquidation preference of $60,801 and
$59,050 as of March 31, 2020 and December 31, 2019,
respectively |
|
|
46,928 |
|
|
|
38,928 |
|
STOCKHOLDERS' EQUITY (DEFICIT) |
|
|
|
|
Class A Common Stock, par value of $0.0001 per share; 400,000,000
shares authorized; 62,355,657 shares and 62,857,624 shares issued
and outstanding as of March 31, 2020 and December 31, 2019,
respectively |
|
|
5 |
|
|
|
5 |
|
Class B Common Stock, par value of $0.0001 per share; 20,000,000
shares authorized; 13,937,332 shares issued and outstanding as of
March 31, 2019 and December 31, 2018 |
|
|
1 |
|
|
|
1 |
|
Additional paid in capital |
|
|
242,143 |
|
|
|
248,302 |
|
Accumulated deficit |
|
|
(283,568 |
) |
|
|
(111,201 |
) |
Total stockholders' equity (deficit) attributable to U.S. Well
Services, Inc. |
|
|
(41,419 |
) |
|
|
137,107 |
|
Noncontrolling interest |
|
|
- |
|
|
|
10,633 |
|
Total Stockholders' Equity (Deficit) |
|
|
(41,419 |
) |
|
|
147,740 |
|
TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY |
|
$ |
415,599 |
|
|
$ |
612,782 |
|
|
|
|
|
|
|
U.S. WELL SERVICES, INC. |
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
THREE MONTHS ENDED MARCH 31, 2020 AND 2019 |
(unaudited and amounts in thousands) |
|
|
|
|
|
|
|
|
2020 |
|
|
|
2019 |
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
Net loss |
|
$ |
(183,167 |
) |
|
$ |
(28,489 |
) |
Adjustments to reconcile net loss to cash provided by (used
in) |
|
|
|
|
operating activities: |
|
|
|
|
Depreciation and amortization |
|
|
32,008 |
|
|
|
37,844 |
|
Impairment loss on long-lived assets |
|
|
147,543 |
|
|
|
- |
|
Provision for losses on accounts receivable |
|
|
9,031 |
|
|
|
- |
|
Loss on disposal of assets |
|
|
4,244 |
|
|
|
6,904 |
|
Share-based compensation expense |
|
|
2,078 |
|
|
|
1,059 |
|
Other noncash items |
|
|
617 |
|
|
|
1,097 |
|
Changes in working capital |
|
|
(23,913 |
) |
|
|
(5,402 |
) |
Net cash provided by (used in) operating
activities |
|
|
(11,559 |
) |
|
|
13,013 |
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
Purchase of property and equipment |
|
|
(35,017 |
) |
|
|
(52,442 |
) |
Proceeds from sale of property and equipment |
|
|
14,907 |
|
|
|
- |
|
Net cash used in investing activities |
|
|
(20,110 |
) |
|
|
(52,442 |
) |
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
Proceeds from issuance of revolving credit facility |
|
|
9,476 |
|
|
|
9,025 |
|
Repayments of revolving credit facility |
|
|
(2,381 |
) |
|
|
- |
|
Proceeds from issuance of long-term debt |
|
|
- |
|
|
|
35,000 |
|
Repayments of long-term debt |
|
|
(2,500 |
) |
|
|
- |
|
Repayments of note payable |
|
|
(2,042 |
) |
|
|
(2,179 |
) |
Repayments of amounts under equipment financing agreements |
|
|
(1,308 |
) |
|
|
(6,683 |
) |
Principal payments under finance lease obligation |
|
|
(1,393 |
) |
|
|
(4,379 |
) |
Other |
|
|
- |
|
|
|
(1,487 |
) |
Net cash provided by (used in) financing
activities |
|
|
(148 |
) |
|
|
29,297 |
|
Net decrease in cash and cash equivalents and restricted cash |
|
|
(31,817 |
) |
|
|
(10,132 |
) |
Cash and cash equivalents and restricted cash, beginning of
period |
|
|
41,404 |
|
|
|
30,036 |
|
Cash and cash equivalents and restricted cash, end of period |
|
$ |
9,587 |
|
|
$ |
19,904 |
|
|
|
|
|
|
Non-GAAP Financial Measures
The Company reports its financial results in
accordance with GAAP. The Company believes, however, that certain
non-GAAP performance measures allow external users of its
consolidated financial statements, such as industry analysts,
investors, lenders and rating agencies, to more effectively
evaluate its operating performance and compare the results of its
operations from period to period and against the Company’s peers
without regard to the Company’s financing methods, hedging
positions or capital structure. Additionally, the Company believes
the use of certain non-GAAP measures highlights trends in the
Company’s business that may not otherwise be apparent when relying
solely on GAAP measures.
Reconciliation of Net Income to Adjusted
EBITDA
EBITDA and Adjusted EBITDA are non-GAAP
financial measures and should not be considered as a substitute for
net income (loss), operating income (loss) or any other performance
measure derived in accordance with GAAP or as an alternative to net
cash provided by operating activities as a measure of the Company’s
profitability or liquidity. The Company’s management believes
EBITDA and Adjusted EBITDA are useful because they allow external
users of its consolidated financial statements, such as industry
analysts, investors, lenders and rating agencies, to more
effectively evaluate the Company’s operating performance, compare
the results of its operations from period to period and against the
Company’s peers without regard to the Company’s financing methods,
hedging positions or capital structure and because it highlights
trends in the Company’s business that may not otherwise be apparent
when relying solely on GAAP measures. The Company believes EBITDA
and Adjusted EBITDA are important supplemental measures of its
performance that are frequently used by others in evaluating
companies in its industry. Because EBITDA and Adjusted EBITDA
exclude some, but not all, items that affect net income (loss) and
may vary among companies, the EBITDA and Adjusted EBITDA that the
Company presents may not be comparable to similarly titled measures
of other companies.
The Company defines EBITDA as earnings before
interest, income taxes, depreciation and amortization. The Company
defines Adjusted EBITDA as EBITDA excluding the following: loss on
disposal of assets; share-based compensation; impairments; and
other items that the Company believes to be non-recurring in
nature. The Company defines Adjusted EBITDA margin as
Adjusted EBITDA as a percentage of Revenue.
U.S. WELL SERVICES, INC. |
RECONCILIATION OF EBITDA AND ADJUSTED EBITDA (NON-GAAP) TO
NET INCOME (GAAP) |
(unaudited, amounts in thousands) |
|
|
|
|
|
|
|
Three Months Ended |
|
March 31,2020 |
|
December 31,2019 |
|
March 31,2019 |
Net loss |
$ |
(183,167 |
) |
|
$ |
(39,433 |
) |
|
$ |
(28,489 |
) |
Interest expense, net |
|
7,952 |
|
|
|
8,715 |
|
|
|
5,115 |
|
Income tax expense (benefit) |
|
(750 |
) |
|
|
(546 |
) |
|
|
124 |
|
Depreciation and amortization |
|
32,008 |
|
|
|
36,260 |
|
|
|
37,844 |
|
EBITDA |
|
(143,957 |
) |
|
|
4,996 |
|
|
|
14,594 |
|
Loss on disposal of assets (a) |
|
4,244 |
|
|
|
4,182 |
|
|
|
6,904 |
|
Share based compensation (b) |
|
2,078 |
|
|
|
2,083 |
|
|
|
1,059 |
|
Impairment loss (c) |
|
147,543 |
|
|
|
- |
|
|
|
- |
|
Fleet start-up and relocation costs (d) |
|
- |
|
|
|
877 |
|
|
|
3,992 |
|
Restructuring and transaction related costs (e) |
|
- |
|
|
|
- |
|
|
|
1,435 |
|
Severance and restructuring (f) |
|
2,840 |
|
|
|
- |
|
|
|
- |
|
Adjusted EBITDA |
$ |
12,748 |
|
|
$ |
12,138 |
|
|
$ |
27,984 |
|
|
|
|
|
|
|
(a) Represents net losses on the disposal of property and
equipment. |
(b) Represents non-cash share-based compensation. |
(c) Represents a non-cash impairment loss with respect to
long-lived assets. |
(d) Represents non-recurring costs related to the start-up and
relocation of hydraulic fracturing fleets. |
(e) Represents non-recurring third-party professional fees and
other costs including costs related to financing transactions, the
capital restructuring and the potential sale of U.S. Well Services,
LLC. |
(f) Represents severance and restructuring cost related to
reductions in force and facility closures. |
|
|
|
|
|
|
Contacts: U.S. Well Services Josh
Shapiro, VP, Finance and Investor Relations (832)
562-3730IR@uswellservices.com
Dennard Lascar Investor RelationsKen Dennard / Lisa
Elliott(713) 529-6600USWS@dennardlascar.com
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