FTS International, Inc. (NYSE:FTSI) Q4 2019 Earnings Conference Call - Final Transcript

Feb 13, 2020 • 10:00 am ET


FTS International, Inc. (NYSE:FTSI) Q4 2019 Earnings Conference Call - Final Transcript


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Greetings, and welcome to the FTS International Fourth Quarter and Year-End 2019 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded, Thursday, February 13, 2020.

I would now like to turn the call over to Michael Messina. Please go ahead, sir.

Michael Messina

Thank you, and good morning, everyone. We appreciate you joining us for the FTS International conference call and webcast to review fourth quarter and full year 2019 results. As a reminder, this conference is being recorded for replay purposes. Presenting today's prepared remarks is Mike Doss, CEO, who will also be joined by Lance Turner, CFO; and Buddy Petersen, COO, for the Q&A portion of the call.

Before we begin, I would like to remind everyone that comments made on today's call that include management's plans, intentions, beliefs, expectations, anticipations or predictions for the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause the Company's actual results to differ materially from those expressed in any forward-looking statement.

These risks and uncertainties are discussed in the Company's annual report on Form 10-K and in other reports the Company files with the SEC. Except as required by law, the Company does not undertake any obligation to publicly update or revise any forward-looking statements. The Company's SEC filings may be obtained by contacting the Company and are available on the Company's website, ftsi.com, and on the SEC's website, sec.gov.

This conference call also includes discussions of non-GAAP financial measures. Our earnings release includes further information about these non-GAAP financial measures as well as reconciliations of these non-GAAP measures to their most directly comparable GAAP measure.

With that, I'll now turn the call over to Mike Doss, FTSI's CEO. Mike?

Michael J. Doss

Thank you, and good morning, everyone. Despite the seasonal slowdown, our fourth quarter came in better than expected. This was the result of very strong operational efficiencies and tracking ahead of schedule on the $40 million of annualized cost reductions we discussed on our last call. Revenue was $142 million, down 23% sequentially, while our stage count was down 10%. The drop in revenue was due to the lower activity, more customers providing their own sand and lower pricing was declined about 5% during the quarter. Adjusted EBITDA was $22.7 million, up from $20.6 million in the third quarter. Annualized adjusted EBITDA per fleet was $5.5 million, compared to $4.2 million in the third quarter.

SG&A was $22.7 million, higher than in the third quarter due to $2.8 million of accelerated stock comp related to layoffs. Excluding stock comp, SG&A was $16.9 million in the fourth quarter, down from $18.2 million in the third quarter. For the first quarter, SG&A is expected to be about $19 million, including $3 million of stock comp. Net loss for the fourth quarter was $13 million, or $0.12 per share.

Capex was $14.9 million, up from $13 million in the third quarter with the increase driven