TETRA Technologies, Inc. (NYSE:TTI) Q4 2015 Earnings Conference Call - Final Transcript

Feb 26, 2016 • 10:30 am ET

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TETRA Technologies, Inc. (NYSE:TTI) Q4 2015 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day and welcome to the TETRA Technologies Incorporated Fourth Quarter and Full Year 2015 Results Conference Call. All participants will be in a listen-only mode. [Operator Instructions].

I would now like to turn the conference over to Mr. Stuart Brightman. Mr. Brightman, please go ahead, sir.

Executive
Stuart Brightman

Thank you, Allison and welcome to the TETRA Technologies fourth and full-year 2015 results conference call. Elijio Serrano, our Chief Financial Officer is also in attendance this morning and will be available to address any of your questions. Our Chief Operating Officer, Joseph Elkhoury is also joining us on the call. I'll provide a brief overview of our fourth quarter results and then turn it over to Elijio for some additional details, which in turn will be followed by your questions.

I must first remind you that this conference call may contain statements that are or maybe deemed to be forward-looking statements. These statements are based on certain assumptions and analysis made by TETRA and are based on a number of factors. These statements are subject to a number of risks and uncertainties, many of which are beyond the control of the Company. You're cautioned that such statements are not guarantees of future performance and that actual results may differ materially from those projected in the forward-looking statements.

In addition, in the course of the call we may refer to net debt, free cash flow, revenues, gross profit, profit before tax, earnings-per-share excluding the Maritech segment or other non-GAAP financial measures. Please refer to this morning's press release or to our public website for reconciliations of non-GAAP financial measures to the nearest GAAP measures. These reconciliations are not a substitute for financial information prepared in accordance with GAAP and should be considered within the context of our completion financial results for the period.

In my remarks, I would like to cover an overview of the fourth quarter, a brief outlook into the next several quarters and the market assumptions that go with it. Our fourth quarter adjusted earnings excluding Maritech and special items were $0.01 per share. This exceeds the guidance we provided on our third quarter call and continues the trend of exceeding those targets. Some of the key highlights of the fourth quarter include, free cash flow of $52 million excluding the impact of Maritech asset retirement obligation expenditures. This gives us full year free cash flow excluding the impact of Maritech of $120 million. Fourth quarter net debt reduction of $43 million and full-year net debt reduction of $102 million.

During the fourth quarter we secured $125 million of 11% senior notes maturing in seven years and used the proceeds to pay down $150 million of senior notes due from April 2016 through 2020. Strong seasonal earnings in our Offshore Services division. In January, we announced a reduction in CCLP's fourth quarter distribution of 25% to be proactive in this market and maintain the strength of our balance sheet. In all our businesses across the Company we continue to be extremely