Bay Street News

ChampionX Reports Second Quarter 2024 Results

THE WOODLANDS, Texas, July 24, 2024 (GLOBE NEWSWIRE) — ChampionX Corporation (NASDAQ: CHX) (“ChampionX” or the “Company”) today announced second quarter of 2024 results. Revenue was $893.3 million, net income attributable to ChampionX was $52.6 million, and adjusted EBITDA was $183.2 million. Income before income taxes margin was 9.3% and adjusted EBITDA margin was 20.5%. Cash from operating activities was $67.6 million and free cash flow was $38.3 million.

CEO Commentary

“We continued to demonstrate the unique nature of ChampionX’s cash flow resiliency driven by the strength of our high-margin operating model and capital-light portfolio of businesses as we generated positive free cash flow for the ninth consecutive quarter. Our strong results in what is a variable environment reflects the ethos of our 7,100 ChampionX employees around the world who have an unwavering focus on delivering value-added solutions for our customers’ most important challenges. I am thankful and humbled to lead such a talented and dedicated team,” ChampionX’s President and Chief Executive Officer Sivasankaran “Soma” Somasundaram said.

“During the second quarter of 2024, we generated revenue of $893 million, which decreased 4% year-over-year, and 3% sequentially. On the top line, our overall results were impacted by lower revenue in Mexico, which declined by approximately $54 million sequentially, and $61 million compared to second quarter 2023. We expect order activity in Mexico to resume towards the end of this year. The balance of our portfolio outperformed in its markets in the second quarter as revenue from all areas other than Mexico increased 3% sequentially and year-over-year. Revenue growth in North America, Middle East & Africa, and Asia Pacific was offset by Latin America, which was impacted by Mexico. North America revenues were up 1% sequentially, driven by the strength and resiliency of our Production Chemical Technologies business which grew 6% sequentially in the region, offset by lower activity in our Drilling Technologies and Production & Automation Technologies product lines consistent with lower rig count and well completions activity during the period. International revenues were down 11% sequentially, driven by Mexico. Revenue from all international areas other than Mexico increased 6% sequentially. We generated net income attributable to ChampionX of $53 million, and we delivered adjusted EBITDA of $183 million, representing a 20.5% adjusted EBITDA margin, which speaks to the operating discipline of our team.

“Earlier this month, we completed the acquisition of RMSpumptools Limited, a UK-based company that designs and manufactures highly engineered mechanical and electrical solutions for complex artificial lift applications. The integration of RMSpumptools’ technology will enhance ChampionX’s Production and Automation Technologies portfolio and will further strengthen the Company’s presence and participation in a broad range of international markets including the Middle East, Latin America, and global offshore developments.

“Cash flow from operating activities was $68 million during the second quarter, which represented 129% of net income attributable to ChampionX, and we generated positive free cash flow of $38 million during the period. This was a strong seasonal result as free cash flow is generally lower in our second quarter. During the quarter, through our regular cash dividend of $18 million, we returned 27% of cash from operating activities and 47% of our free cash flow to our shareholders. In the first half of 2024, cash flow from operating activities was $241 million, which represented 146% of net income attributable to ChampionX, and we generated strong free cash flow of $182 million, which represented 49% of our adjusted EBITDA for the period. We are pleased with this strong first half of the year cash flow result and we remain confident in achieving at least 50% adjusted EBITDA to free cash flow conversion for 2024. Our balance sheet and financial position remain strong, ending the second quarter with approximately $1.1 billion of liquidity, including $393 million of cash and $672 million of available capacity on our revolving credit facility.”

Agreement to be Acquired by SLB

On April 2, 2024, SLB (NYSE: SLB) and ChampionX jointly announced a definitive Agreement and Plan of Merger (the “Merger Agreement”) for SLB to purchase ChampionX in an all-stock transaction. The transaction was unanimously approved by the ChampionX board of directors and the transaction received the approval of the ChampionX stockholders at a special meeting held on June 18, 2024. The transaction is subject to regulatory approvals and other customary closing conditions. It is currently anticipated that the closing of the transaction will occur in the fourth quarter of 2024 or the first quarter of 2025.

ChampionX may continue to pay its regular quarterly cash dividends with customary record and payment dates, subject to certain limitations under the Merger Agreement. Given the pending acquisition of ChampionX by SLB, ChampionX has discontinued providing quarterly guidance and will not host a conference call or webcast to discuss its second quarter 2024 results.

Production Chemical Technologies

Production Chemical Technologies revenue in the second quarter of 2024 was $569.6 million, a decrease of $20.5 million, or 3%, sequentially, due primarily to lower sales in Mexico.

Segment operating profit was $85.4 million and adjusted segment EBITDA was $117.4 million. Segment operating profit margin was 15.0%, an increase of 11 basis points, sequentially, and adjusted segment EBITDA margin was 20.6%, an increase of 61 basis points, sequentially. The sequential increase in segment operating profit margin and adjusted segment EBITDA margin was driven by strong cost management.

Production & Automation Technologies

Production & Automation Technologies revenue in the second quarter of 2024 was $244.5 million, a decrease of $8.1 million, or 3%, sequentially, due primarily to slightly lower customer demand in North America. Revenue from digital products was $54.1 million in the second quarter of 2024, a decrease of 5% sequentially, driven by lower activity in North America.

Segment operating profit was $22.2 million and adjusted segment EBITDA was $58.8 million. Segment operating profit margin was 9.1%, a decrease of 219 basis points, sequentially, and adjusted segment EBITDA margin was 24.1%, an increase of 18 basis points, sequentially. The increase in adjusted segment EBITDA margin was driven by productivity improvements.

Drilling Technologies

Drilling Technologies revenue in the second quarter of 2024 was $52.9 million, a decrease of $2.3 million, or 4%, sequentially, driven by lower worldwide rig count.

Segment operating profit was $11.9 million and adjusted segment EBITDA was $13.1 million. Segment operating profit margin was 22.4%, compared to 80.4% in the prior quarter. Segment operating profit in the prior quarter included a $29.9 million net gain on the sale and leaseback of certain buildings and land. Adjusted segment EBITDA margin was 24.9%, a decrease of 425 basis points, sequentially, due primarily to lower volumes and the absence of certain one-time benefits (scrap sales and a royalty payment) in the prior quarter.

Reservoir Chemical Technologies

Reservoir Chemical Technologies revenue in the second quarter 2024 was $27.1 million, an increase of $2.4 million, or 10%, sequentially, driven by higher sales volumes.

Segment operating profit was $4.4 million and adjusted segment EBITDA was $6.0 million. Segment operating profit margin was 16.1%, an increase of 92 basis points, sequentially, and adjusted segment EBITDA margin was 22.0%, an increase of 31 basis points, sequentially. The increase in adjusted segment EBITDA margin was driven by higher volumes.

Other Business Highlights: Better Together

Other Business Highlights: Chemical Technologies

Other Business Highlights: Production & Automation Technologies

About Non-GAAP Measures

In addition to financial results determined in accordance with generally accepted accounting principles in the United States (“GAAP”), this news release presents non-GAAP financial measures. Management believes that adjusted EBITDA, adjusted EBITDA margin, adjusted net income attributable to ChampionX and adjusted diluted earnings per share attributable to ChampionX, provide useful information to investors regarding the Company’s financial condition and results of operations because they reflect the core operating results of our businesses and help facilitate comparisons of operating performance across periods. In addition, free cash flow, free cash flow to adjusted EBITDA ratio, and free cash flow to revenue ratio are used by management to measure our ability to generate positive cash flow for debt reduction and to support our strategic objectives. Although management believes the aforementioned non-GAAP financial measures are good tools for internal use and the investment community in evaluating ChampionX’s overall financial performance, the foregoing non-GAAP financial measures should be considered in addition to, not as a substitute for or superior to, other measures of financial performance prepared in accordance with GAAP. A reconciliation of these non-GAAP measures to the most directly comparable GAAP measures is included in the accompanying financial tables.

About ChampionX

ChampionX is a global leader in chemistry solutions, artificial lift systems, and highly engineered equipment and technologies that help companies drill for and produce oil and gas safely, efficiently, and sustainably around the world. ChampionX’s expertise, innovative products, and digital technologies provide enhanced oil and gas production, transportation, and real-time emissions monitoring throughout the lifecycle of a well. To learn more about ChampionX, visit our website at www.ChampionX.com.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include statements relating to the proposed transaction between SLB and ChampionX, including statements regarding the benefits of the transaction and the anticipated timing of the transaction, and information regarding the businesses of SLB and ChampionX, including expectations regarding outlook and all underlying assumptions, SLB’s and ChampionX’s objectives, plans and strategies, information relating to operating trends in markets where SLB and ChampionX operate, statements that contain projections of results of operations or of financial condition and all other statements other than statements of historical fact that address activities, events or developments that SLB or ChampionX intends, expects, projects, believes or anticipates will or may occur in the future. Such statements are based on management’s beliefs and assumptions made based on information currently available to management. All statements in this communication, other than statements of historical fact, are forward-looking statements that may be identified by the use of the words “outlook,” “guidance,” “expects,” “believes,” “anticipates,” “should,” “estimates,” “intends,” “plans,” “seeks,” “targets,” “may,” “can,” “believe,” “predict,” “potential,” “projected,” “projections,” “precursor,” “forecast,” “ambition,” “goal,” “scheduled,” “think,” “could,” “would,” “will,” “see,” “likely,” and other similar expressions or variations, but not all forward-looking statements include such words. These forward-looking statements involve known and unknown risks and uncertainties, and which may cause SLB’s or ChampionX’s actual results and performance to be materially different from those expressed or implied in the forward-looking statements. Factors and risks that may impact future results and performance include, but are not limited to those factors and risks described in Part I, “Item 1. Business”, “Item 1A. Risk Factors”, and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in SLB’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the Securities and Exchange Commission (the “SEC”) on January 24, 2024 and Part 1, Item 1A, “Risk Factors” in ChampionX’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 6, 2024, and each of their respective, subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. These include, but are not limited to, and in each case as a possible result of the proposed transaction on each of SLB and ChampionX: the ultimate outcome of the proposed transaction between SLB and ChampionX, including the effect of the announcement of the proposed transaction; the ability to operate the SLB and ChampionX respective businesses, including business disruptions; difficulties in retaining and hiring key personnel and employees; the ability to maintain favorable business relationships with customers, suppliers and other business partners; the terms and timing of the proposed transaction; the occurrence of any event, change or other circumstance that could give rise to the termination of the proposed transaction; the anticipated or actual tax treatment of the proposed transaction; the ability to satisfy closing conditions to the completion of the proposed transaction (including the adoption of the merger agreement in respect of the proposed transaction by ChampionX stockholders); other risks related to the completion of the proposed transaction and actions related thereto; the ability of SLB and ChampionX to integrate the business successfully and to achieve anticipated synergies and value creation from the proposed transaction; changes in demand for SLB’s or ChampionX’s products and services; global market, political and economic conditions, including in the countries in which SLB and ChampionX operate; the ability to secure government regulatory approvals on the terms expected, at all or in a timely manner; the extent of growth of the oilfield services market generally, including for chemical solutions in production and midstream operations; the global macro-economic environment, including headwinds caused by inflation, rising interest rates, unfavorable currency exchange rates, and potential recessionary or depressionary conditions; the impact of shifts in prices or margins of the products that SLB or ChampionX sells or services that SLB or ChampionX provides, including due to a shift towards lower margin products or services; cyber-attacks, information security and data privacy; the impact of public health crises, such as pandemics (including COVID-19) and epidemics and any related company or government policies and actions to protect the health and safety of individuals or government policies or actions to maintain the functioning of national or global economies and markets; trends in crude oil and natural gas prices, including trends in chemical solutions across the oil and natural gas industries, that may affect the drilling and production activity, profitability and financial stability of SLB’s and ChampionX’s customers and therefore the demand for, and profitability of, their products and services; litigation and regulatory proceedings, including any proceedings that may be instituted against SLB or ChampionX related to the proposed transaction; failure to effectively and timely address energy transitions that could adversely affect the businesses of SLB or ChampionX, results of operations, and cash flows of SLB or ChampionX; and disruptions of SLB’s or ChampionX’s information technology systems.

These risks, as well as other risks related to the proposed transaction, are included in the Form S-4 and proxy statement/prospectus that was filed with the SEC in connection with the proposed transaction. While the list of factors presented here is, and the list of factors presented in the registration statement on Form S-4 are, considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. For additional information about other factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to SLB’s and ChampionX’s respective periodic reports and other filings with the SEC, including the risk factors identified in SLB’s and ChampionX’s Annual Reports on Form 10-K, respectively, and SLB’s and ChampionX’s subsequent Quarterly Reports on Form 10-Q. The forward-looking statements included in this communication are made only as of the date hereof. Neither SLB nor ChampionX undertakes any obligation to update any forward-looking statements to reflect subsequent events or circumstances, except as required by law.

Investor Contact: Byron Pope
byron.pope@championx.com
281-602-0094

Media Contact: John Breed
john.breed@championx.com
281-403-5751

CHAMPIONX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)

  Three Months Ended   Six Months Ended
  June 30,   March 31,   June 30,   June 30,
(in thousands, except per share amounts)   2024       2024       2023       2024       2023  
Revenue $ 893,272     $ 922,141     $ 926,600     $ 1,815,413     $ 1,874,947  
Cost of goods and services   613,426       622,937       644,394       1,236,363       1,309,386  
Gross profit   279,846       299,204       282,206       579,050       565,561  
Costs and expenses:                  
Selling, general and administrative expense   182,995       172,414       162,484       355,409       323,300  
(Gain) loss on disposal group and sale-leaseback transaction         (29,883 )           (29,883 )     12,965  
Interest expense, net   15,421       13,935       14,544       29,356       27,010  
Foreign currency transaction (gains) losses, net   (2,767 )     55       4,439       (2,712 )     13,691  
Other expense (income), net   938       2,927       (7,543 )     3,865       (11,500 )
Income before income taxes   83,259       139,756       108,282       223,015       200,095  
Provision for income taxes   27,868       26,596       11,656       54,464       40,325  
Net income   55,391       113,160       96,626       168,551       159,770  
Net income attributable to noncontrolling interest   2,822       237       829       3,059       441  
Net income attributable to ChampionX $ 52,569     $ 112,923     $ 95,797     $ 165,492     $ 159,329  
                   
Earnings per share attributable to ChampionX:                  
Basic $ 0.28     $ 0.59     $ 0.49     $ 0.87     $ 0.81  
Diluted $ 0.27     $ 0.58     $ 0.48     $ 0.85     $ 0.79  
                   
Weighted-average shares outstanding:                  
Basic   190,426       190,803       197,034       190,615       197,657  
Diluted   193,257       193,964       200,735       193,740       201,694  
                                       

CHAMPIONX CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

(in thousands) June 30, 2024   December 31, 2023
ASSETS      
Current Assets:      
Cash and cash equivalents $ 393,297     $ 288,557  
Receivables, net   441,401       534,534  
Inventories, net   538,999       521,549  
Prepaid expenses and other current assets   71,489       80,777  
Total current assets   1,445,186       1,425,417  
       
Property, plant and equipment, net   752,553       773,552  
Goodwill   684,567       669,064  
Intangible assets, net   229,562       243,553  
Other non-current assets   177,472       130,116  
Total assets $ 3,289,340     $ 3,241,702  
       
LIABILITIES AND EQUITY      
Current Liabilities:      
Current portion of long-term debt $ 6,203     $ 6,203  
Accounts payable   484,472       451,680  
Other current liabilities   237,030       324,866  
Total current liabilities   727,705       782,749  
       
Long-term debt   592,868       594,283  
Other long-term liabilities   239,534       203,639  
Stockholders’ equity:      
ChampionX stockholders’ equity   1,745,155       1,676,622  
Noncontrolling interest   (15,922 )     (15,591 )
Total liabilities and equity $ 3,289,340     $ 3,241,702  
 

CHAMPIONX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

  Six Months Ended June 30,
(in thousands)   2024       2023  
Cash flows from operating activities:      
Net income $ 168,551     $ 159,770  
Depreciation and amortization   119,783       115,387  
(Gain) loss on sale-leaseback transaction and disposal group   (29,883 )     12,965  
Loss on Argentina Blue Chip Swap transaction   7,168        
Deferred income taxes   (15,092 )     (22,187 )
Loss (gain) on disposal of fixed assets   217       (1,070 )
Receivables   90,912       83,589  
Inventories   (40,897 )     (70,040 )
Accounts payable   20,919       40,632  
Other assets   1,016       3,135  
Leased assets   (15,770 )     (22,125 )
Other operating items, net   (65,791 )     (91,768 )
Net cash flows provided by operating activities   241,133       208,288  
       
Cash flows from investing activities:      
Capital expenditures   (65,314 )     (57,277 )
Proceeds from sale of fixed assets   6,482       7,109  
Proceeds from sale-leaseback transaction   44,292        
Purchase of investments   (31,526 )      
Sale of investments   24,358        
Acquisitions, net of cash acquired   (21,472 )      
Net cash used for investing activities   (43,180 )     (50,168 )
       
Cash flows from financing activities:      
Proceeds from long-term debt         15,500  
Repayment of long-term debt   (3,102 )     (43,633 )
Repurchases of common stock   (49,399 )     (91,617 )
Dividends paid   (34,336 )     (31,591 )
Other   (4,557 )     6,100  
Net cash used for financing activities   (91,394 )     (145,241 )
       
Effect of exchange rate changes on cash and cash equivalents   (1,819 )     22  
       
Net increase in cash and cash equivalents   104,740       12,901  
Cash and cash equivalents at beginning of period   288,557       250,187  
Cash and cash equivalents at end of period $ 393,297     $ 263,088  
 

CHAMPIONX CORPORATION
BUSINESS SEGMENT DATA
(UNAUDITED)

  Three Months Ended
  June 30,   March 31,   June 30,
(in thousands)   2024       2024       2023  
Segment revenue:          
Production Chemical Technologies $ 569,577     $ 590,108     $ 574,302  
Production & Automation Technologies   244,487       252,614       254,156  
Drilling Technologies   52,888       55,206       57,324  
Reservoir Chemical Technologies   27,123       24,705       23,853  
Corporate and other   (803 )     (492 )     16,965  
Total revenue $ 893,272     $ 922,141     $ 926,600  
           
Income before income taxes:        
Segment operating profit (loss):          
Production Chemical Technologies $ 85,388     $ 87,832     $ 87,163  
Production & Automation Technologies   22,207       28,470       33,208  
Drilling Technologies   11,863       44,402       12,660  
Reservoir Chemical Technologies   4,363       3,746       2,186  
Total segment operating profit   123,821       164,450       135,217  
Corporate and other   25,141       10,759       12,391  
Interest expense, net   15,421       13,935       14,544  
Income before income taxes $ 83,259     $ 139,756     $ 108,282  
           
Operating profit margin / income before income taxes margin:          
Production Chemical Technologies   15.0 %     14.9 %     15.2 %
Production & Automation Technologies   9.1 %     11.3 %     13.1 %
Drilling Technologies   22.4 %     80.4 %     22.1 %
Reservoir Chemical Technologies   16.1 %     15.2 %     9.2 %
ChampionX Consolidated   9.3 %     15.2 %     11.7 %
           
Adjusted EBITDA          
Production Chemical Technologies $ 117,421     $ 118,031     $ 121,175  
Production & Automation Technologies   58,848       60,340       60,641  
Drilling Technologies   13,149       16,074       14,376  
Reservoir Chemical Technologies   5,954       5,346       4,385  
Corporate and other   (12,139 )     (8,079 )     (9,896 )
Adjusted EBITDA $ 183,233     $ 191,712     $ 190,681  
           
Adjusted EBITDA margin          
Production Chemical Technologies   20.6 %     20.0 %     21.1 %
Production & Automation Technologies   24.1 %     23.9 %     23.9 %
Drilling Technologies   24.9 %     29.1 %     25.1 %
Reservoir Chemical Technologies   22.0 %     21.6 %     18.4 %
ChampionX Consolidated   20.5 %     20.8 %     20.6 %
                       

CHAMPIONX CORPORATION
RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL MEASURES
(UNAUDITED)

  Three Months Ended
  June 30,   March 31,   June 30,
(in thousands)   2024       2024       2023  
Net income attributable to ChampionX $ 52,569     $ 112,923     $ 95,797  
Pre-tax adjustments:          
(Gain) loss on sale leaseback transaction and disposal group (1)         (29,883 )      
Russia sanctions compliance and impacts (2)   32       152       433  
Restructuring and other related charges   7,927       1,709       5,353  
Merger transaction costs (3)   15,059              
Acquisition costs and related adjustments (4)   574       1,232       (2,341 )
Intellectual property defense   531       779       687  
Tulsa, Oklahoma storm damage         305       607  
Foreign currency transaction (gains) losses, net   (2,767 )     55       4,439  
Loss on Argentina Blue Chip Swap transaction   2,994       4,092        
Tax impact of adjustments   (5,722 )     5,066       (2,041 )
Adjusted net income attributable to ChampionX   71,197       96,430       102,934  
Tax impact of adjustments   5,722       (5,066 )     2,041  
Net income attributable to noncontrolling interest   2,822       237       829  
Depreciation and amortization   60,203       59,580       58,677  
Provision for income taxes   27,868       26,596       11,656  
Interest expense, net   15,421       13,935       14,544  
Adjusted EBITDA $ 183,233     $ 191,712     $ 190,681  
                       
(1)  Amount represents the gain on the sale and leaseback of certain buildings and land for the three months ended March 31, 2024.
(2) Includes charges incurred related to legal and professional fees to comply with, as well as additional foreign currency exchange losses associated with, the sanctions imposed in Russia.
(3) Includes costs incurred in relation to the Merger Agreement with Schlumberger Limited, including third party legal and professional fees.
(4) Includes costs incurred for the acquisition of businesses. For the historical period ended June 30, 2023, amounts represent revenue associated with the amortization of a liability established as part of the merger transaction with Ecolab Inc. (“Ecolab”) to acquire the Chemical Technologies business, representing unfavorable terms under the Cross Supply Agreement.
 
  Three Months Ended
  June 30,   March 31,   June 30,
(in thousands)   2024       2024       2023  
Diluted earnings per share attributable to ChampionX $ 0.27     $ 0.58     $ 0.48  
Per share adjustments:          
(Gain) loss on sale leaseback transaction and disposal group         (0.15 )      
Russia sanctions compliance and impacts                
Restructuring and other related charges   0.04       0.01       0.03  
Merger transaction costs   0.08              
Acquisition costs and related adjustments         0.01       (0.01 )
Intellectual property defense                
Tulsa, Oklahoma storm damage                
Foreign currency transaction (gains) losses, net   (0.01 )           0.02  
Loss on Argentina Blue Chip Swap transaction   0.02       0.02        
Tax impact of adjustments   (0.03 )     0.03       (0.01 )
Adjusted diluted earnings per share attributable to ChampionX $ 0.37     $ 0.50     $ 0.51  
 

CHAMPIONX CORPORATION
RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL MEASURES BY SEGMENT
(UNAUDITED)

  Three Months Ended
  June 30,   March 31,   June 30,
(in thousands)   2024       2024       2023  
Production Chemical Technologies          
Segment operating profit $ 85,388     $ 87,832     $ 87,163  
Non-GAAP adjustments   5,851       3,933       8,329  
Depreciation and amortization   26,182       26,266       25,683  
Segment adjusted EBITDA $ 117,421     $ 118,031     $ 121,175  
           
Production & Automation Technologies          
Segment operating profit $ 22,207     $ 28,470     $ 33,208  
Non-GAAP adjustments   6,000       2,076       1,012  
Depreciation and amortization   30,641       29,794       26,421  
Segment adjusted EBITDA $ 58,848     $ 60,340     $ 60,641  
           
Drilling Technologies          
Segment operating profit $ 11,863     $ 44,402     $ 12,660  
Non-GAAP adjustments         (29,883 )     212  
Depreciation and amortization   1,286       1,555       1,504  
Segment adjusted EBITDA $ 13,149     $ 16,074     $ 14,376  
           
Reservoir Chemical Technologies          
Segment operating profit $ 4,363     $ 3,746     $ 2,186  
Non-GAAP adjustments   11       16       600  
Depreciation and amortization   1,580       1,584       1,599  
Segment adjusted EBITDA $ 5,954     $ 5,346     $ 4,385  
           
Corporate and other          
Segment operating profit $ (40,562 )   $ (24,694 )   $ (26,935 )
Non-GAAP adjustments   12,488       2,299       (975 )
Depreciation and amortization   514       381       3,470  
Interest expense, net   15,421       13,935       14,544  
Segment adjusted EBITDA $ (12,139 )   $ (8,079 )   $ (9,896 )
 

Free Cash Flow

  Three Months Ended
  June 30,   March 31,   June 30,
(in thousands)   2024       2024       2023  
Free Cash Flow          
Cash flows from operating activities $ 67,625     $ 173,508     $ 115,910  
Less: Capital expenditures, net of proceeds from sale of fixed assets   (29,310 )     (29,522 )     (27,143 )
Free cash flow $ 38,315     $ 143,986     $ 88,767  
           
Cash From Operating Activities to Revenue Ratio          
Cash flows from operating activities $ 67,625     $ 173,508     $ 115,910  
Revenue $ 893,272     $ 922,141     $ 926,600  
           
Cash from operating activities to revenue ratio   8 %     19 %     13 %
           
Free Cash Flow to Revenue Ratio          
Free cash flow $ 38,315     $ 143,986     $ 88,767  
Revenue $ 893,272     $ 922,141     $ 926,600  
           
Free cash flow to revenue ratio   4 %     16 %     10 %
           
Free Cash Flow to Adjusted EBITDA Ratio          
Free cash flow $ 38,315     $ 143,986     $ 88,767  
Adjusted EBITDA $ 183,233     $ 191,712     $ 190,681  
           
Free cash flow to adjusted EBITDA ratio   21 %     75 %     47 %
                       


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