Company Overview - TETRA Technologies, Inc. is an energy services and solutions company focused on environmentally conscious services and solutions that enhance quality of life [3] - The company operates on six continents and has a portfolio that includes Energy Services, Industrial Chemicals, and Critical Minerals [3] - TETRA provides products and services to the oil and gas industry and calcium chloride for various applications, while also expanding into the low-carbon energy market [3] Upcoming Event - TETRA's senior management will participate in the Virtual Lytham Partners Spring 2025 Investor Conference on May 29, 2025 [1] - Key executives including the CEO, CFO, and VP of Investor Relations will present and host one-on-one meetings with institutional investors [1] - A webcast of the event will be streamed at 1:15 pm ET on May 29, with a replay available the following day [2]

Core Insights - Thiogenesis Therapeutics has initiated a Phase 2 clinical trial for TTI-0102, targeting the treatment of MELAS, an inherited mitochondrial disease [1][3] - The trial aims to assess the safety, tolerability, efficacy, and pharmacokinetics of TTI-0102 over a 6-month period, involving 12 patients [2][3] - TTI-0102 is designed to increase intracellular antioxidants and amino acids, addressing deficiencies in MELAS patients [3][8] Company Overview - Thiogenesis Therapeutics is a clinical-stage biotechnology company based in San Diego, focusing on developing disulfides that enhance intracellular antioxidant production [1][10] - The company is publicly traded on the TSX Venture Exchange and OTCQX, with a focus on treating serious pediatric diseases with unmet medical needs [10] Clinical Trial Details - The Phase 2 trial is a multi-country, multi-center study conducted in the Netherlands and France, with a randomized, double-blind, placebo-controlled design [2] - A total of 12 patients will be enrolled, with 8 receiving TTI-0102 and 4 receiving a placebo, followed by an interim analysis after 3 months [2] Disease Background - MELAS is characterized by symptoms such as seizures, muscle weakness, and fatigue, often presenting before the age of 20, and is caused by mitochondrial DNA mutations [4] - The disease affects approximately 4.1 per 100,000 of the population, making it one of the most prevalent inherited mitochondrial disorders [4] Product Information - TTI-0102 is an asymmetric disulfide and prodrug that acts as a precursor to cysteamine, aimed at restoring mitochondrial function by increasing levels of glutathione and taurine [8] - The prodrug formulation addresses limitations of first-generation thiol-based drugs, including short half-life and adverse side effects [8][9]

Group 1 - TETRA Technologies, Inc. will participate in the D. Boral Capital Inaugural Global Conference on May 14, 2025, in New York City [1] - Senior management, including the CEO, CFO, and VP of Investor Relations, will host one-on-one meetings with institutional investors during the conference [1] - Investors interested in scheduling meetings can contact the company directly [2] Group 2 - TETRA Technologies, Inc. is an energy services and solutions company focused on environmentally conscious services [2] - The company operates on six continents and has a portfolio that includes Energy Services, Industrial Chemicals, and Critical Minerals [2] - TETRA is expanding into the low-carbon energy market, leveraging its chemistry expertise and global infrastructure to meet sustainable energy demands [2]

Financial Data and Key Metrics Changes - The company reported a record first quarter adjusted EBITDA of $32.3 million, with adjusted EBITDA margins of 20.5% [5] - Total revenue reached $157 million, reflecting a 17% sequential increase and a 4% year-over-year increase [5] - Adjusted EBITDA increased by 41% sequentially and year-over-year [5] Business Line Data and Key Metrics Changes - The Completion Fluids and Products segment generated $93 million in revenue, a 35% sequential increase, with adjusted EBITDA of $33.2 million, up 77% sequentially [20] - The Water and Flowback Services segment saw revenue decline by 2% sequentially to $64 million, but it was up 13% year-over-year, with adjusted EBITDA of $8.3 million [20][21] Market Data and Key Metrics Changes - Offshore deepwater operations increased by 60% year-over-year, with 24 deepwater projects completed in the quarter compared to 15 in the same period last year [6] - The company noted a decline in U.S. Frac activity by approximately 10%, but the Water and Flowback Services segment outperformed this decline [8] Company Strategy and Development Direction - The company is focusing on emerging growth initiatives, including desalination of produced water and energy storage solutions [12][14] - The Arkansas Evergreen Brine Production Unit expansion was approved, allowing for optimization of bromine and lithium extraction [15][16] - The company plans to self-fund its bromine project without issuing equity or increasing debt [17][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong second quarter outlook despite macroeconomic uncertainties [28] - The company anticipates adjusted EBITDA guidance for the first half of 2025 to be between $57 million and $65 million, up from the previous range [11] - Management highlighted the importance of monitoring customer plans and activity levels in response to the uncertain oil price environment [11] Other Important Information - The company generated strong free cash flow in the first quarter, with a year-over-year improvement of $41 million [12] - Liquidity at the end of the quarter was approximately $219 million, with a net leverage ratio improvement to 1.5 times [24] Q&A Session Summary Question: What are the biggest holdups for prospective customers on Oasis commercial pilots? - Management indicated that customers need to be comfortable with the technology and evolving environmental regulations, with expectations for multiple pilot projects in 2026 [33][34] Question: Can you provide specifics on regulatory support for beneficial reuse? - Management noted engagement with the Texas Railroad Commission and legislative support for surface discharge and beneficial reuse of produced water [35][36] Question: Will the first production well for Evergreen be left uncompleted until the processing facility is ready? - Management confirmed that the first well will be drilled and put on standby until the processing facility is operational [39] Question: What is the outlook for the deepwater market compared to previous quarters? - Management stated that there have been no changes to scheduled deepwater projects for the year, despite some uncertainty in the market [99][100]

Financial Data and Key Metrics Changes - TETRA reported a record first quarter adjusted EBITDA of $32.3 million, with adjusted EBITDA margins of 20.5% [5][11] - Total revenue reached $157 million, reflecting a 17% sequential increase and a 4% year-over-year increase [5][11] - Adjusted EBITDA increased by 41% sequentially and year-over-year [5] Business Line Data and Key Metrics Changes - Completion Fluids and Products segment revenue was $93 million, up 35% sequentially, with adjusted EBITDA of $33.2 million, a 77% sequential increase [21] - Water and Flowback Services segment revenue declined by 2% sequentially to $64 million but increased by 13% year-over-year, with adjusted EBITDA of $8.3 million [21][22] Market Data and Key Metrics Changes - Offshore deepwater operations saw a 60% year-over-year increase, with 24 deepwater projects worked on in the quarter compared to 15 in the same period last year [6] - The U.S. Frac activity declined approximately 10%, but TETRA's Water and Flowback Services outperformed this decline [7] Company Strategy and Development Direction - TETRA is focusing on emerging growth initiatives, including desalination of produced water and energy storage solutions [12][14] - The company plans to self-fund its bromine project without issuing equity or increasing debt, balancing investments with demand projections [18][19] - TETRA is prioritizing automation in its Water and Flowback segment to improve margins and operational efficiency [9][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong second quarter outlook despite macroeconomic uncertainties, adjusting the lower end of adjusted EBITDA guidance for the first half of 2025 to $57 million [11][28] - The company anticipates continued growth in 2025, driven by strong free cash flow from its base business [28] Other Important Information - TETRA's liquidity at the end of the first quarter was approximately $219 million, with a net leverage ratio improved to 1.5 times [24] - The company is actively engaging with regulatory bodies to support beneficial reuse of produced water, indicating a positive trend in regulatory support [36][37] Q&A Session Summary Question: What are the biggest holdups for customers on commercial pilots for Oasis? - Management indicated that customers need to be comfortable with the technology and evolving environmental regulations, with expectations for multiple pilot projects in 2026 [34] Question: Can you provide specifics on regulatory support for beneficial reuse? - Management highlighted engagement with the Texas Railroad Commission and legislative movements supporting surface discharge and beneficial reuse of produced water [36] Question: Will the first production well for Evergreen be left uncompleted until the processing facility is ready? - Yes, the first well will be drilled and put on standby until the bromine processing facility is operational [40] Question: What is the outlook for the deepwater market compared to previous quarters? - Management noted that there have been no changes to scheduled deepwater projects, indicating resilience despite commodity price fluctuations [98][101]

Group 1: Earnings Performance - Tetra Technologies reported quarterly earnings of $0.11 per share, exceeding the Zacks Consensus Estimate of $0.08 per share, and up from $0.05 per share a year ago, representing an earnings surprise of 37.50% [1] - The company posted revenues of $157.14 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 0.84%, compared to year-ago revenues of $150.97 million [2] Group 2: Stock Performance and Outlook - Tetra Technologies shares have declined approximately 24.3% since the beginning of the year, while the S&P 500 has decreased by 6% [3] - The current consensus EPS estimate for the upcoming quarter is $0.13 on revenues of $172.08 million, and for the current fiscal year, it is $0.26 on revenues of $619.17 million [7] Group 3: Industry Context - The Oil and Gas - Field Services industry, to which Tetra Technologies belongs, is currently ranked in the top 30% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8]

Financial Performance - Consolidated revenue for Q1 2025 was $157.1 million, a 16.8% increase from $134.5 million in Q4 2024, driven by strong performance in the Completion Fluids & Products Division [82][88]. - Consolidated revenues for the three months ended March 31, 2025, increased to $157,140,000, a 4.1% increase from $150,972,000 in the same period of 2024 [100]. - Total revenue for the three months ended March 31, 2025, was $157.14 million, a significant increase from $134.50 million in the same period of 2024, representing a year-over-year growth of approximately 16.8% [1]. - Net income before discontinued operations dropped to $4.0 million in Q1 2025, a 96.1% decline from $102.7 million in Q4 2024, primarily due to a significant tax provision change [88][91]. - Net income attributable to TETRA stockholders surged to $4,049,000, a remarkable 342.5% increase compared to $915,000 in the prior year [100]. - The company reported a net income before taxes of $5.09 million for the first quarter of 2025, compared to a net loss of $8.12 million in the same quarter of 2024 [1]. Division Performance - Completion Fluids & Products Division revenues rose to $93.0 million, a 35.1% increase from $68.9 million in Q4 2024, attributed to the completion of the first CS Neptune well and an early start to the calcium chloride season [92]. - The Completion Fluids & Products Division reported revenues of $93,018,000, a 20.4% increase from $77,282,000, driven by strong project completions [106]. - Water & Flowback Services revenues decreased by 2.3% to $64.1 million compared to $65.6 million in Q4 2024, reflecting lower customer activity in the North American onshore market [96]. - The Water & Flowback Services Division experienced a revenue decline of 13.0%, down to $64,122,000 from $73,690,000, primarily due to reduced drilling activity in the U.S. [109]. Profitability and Expenses - Gross profit for the Completion Fluids & Products Division increased by 47.0% to $36.5 million, with gross profit margin improving to 39.3% from 36.1% [92][93]. - Gross profit rose to $42,906,000, reflecting a significant 38.0% increase from $31,102,000 year-over-year, with gross profit as a percentage of revenue improving to 27.3% [100][101]. - General and administrative expenses for the Completion Fluids & Products Division increased by 11.1% to $6.7 million, reflecting higher compensation and professional service costs [94]. - General and administrative expenses increased to $24,134,000, an 8.2% rise from $22,298,000, attributed to higher professional services costs [100][102]. - Interest expense, net decreased by $1,228,000 to $4,724,000, a 20.6% reduction, due to lower interest rates and increased capitalized interest [100][102]. Tax and Corporate Overhead - The effective tax rate for Q1 2025 was 20.4%, compared to a benefit in the previous quarter, reflecting the reversal of a valuation allowance related to deferred tax assets [91]. - The effective tax rate for the current year was 20.4%, down from 29.3% in the prior year, with a provision for income taxes of $1,037,000 compared to $380,000 previously [105]. - The corporate overhead net loss before taxes increased by 38.2% to $16.7 million, primarily due to a decrease in unrealized gains from investments [99]. - Corporate overhead net loss before taxes decreased to $16,703,000 from $19,218,000, primarily due to the absence of a $5.5 million loss on debt extinguishment [112]. Cash Flow and Liquidity - Operating cash flows improved to $3.94 million in Q1 2025, up from a cash outflow of $13.82 million in Q1 2024, primarily due to increased gross profit and working capital changes [1][21]. - Capital expenditures for the first three months of 2025 totaled $18.0 million, with $11.2 million allocated to Arkansas brine resource development [1][22]. - The company had liquidity of $208.1 million at the end of Q1 2025, consisting of unrestricted cash and available credit [1][19]. - Proceeds from the sale of Kodiak shares amounted to $19.0 million during the first quarter of 2025, net of broker commissions and fees [1][23]. Strategic Initiatives - The company is advancing low-carbon energy initiatives, including a feasibility study for bromine production and ongoing negotiations for supply agreements to support deepwater market demands [85]. - TETRA is launching a pilot project for the TETRA Oasis Total Desalination Solution, expected to begin in the first half of 2025, focusing on water treatment and desalination for produced water [86]. - The company is negotiating bridging supply agreements for bromine, which may allow for flexibility in plant start-up timing and additional cash accumulation from existing operations [1][24]. - The company anticipates potential extraction of lithium and bromine from its Evergreen Unit, but the economic viability and timing of such activities remain uncertain [141]. - The company is focused on developing a bromine processing facility, with risks associated with construction and equipment supply [142]. - The company has entered into a Memorandum of Understanding (MOU) with Saltwerx, but the ability to negotiate definitive agreements and produce lithium and bromine remains uncertain [141]. Risks and Uncertainties - The company faces numerous risks and uncertainties that could impact its financial performance, including economic conditions and regulatory changes [140]. - The company is exposed to interest rate risk with borrowings under the Term Credit Agreement bearing interest at SOFR plus 5.75% [143]. - The company has currency exchange rate risk exposure related to revenues and expenses in foreign currencies, but had no foreign currency exchange contracts outstanding as of March 31, 2025 [145]. - The company has not entered into any interest rate swap contracts to hedge against interest rate fluctuations [143]. - The company cautions investors not to rely solely on forward-looking statements due to inherent risks and uncertainties [142].

Financial Performance - First quarter 2025 total revenue was $157 million, a 17% sequential increase and a 4% year-over-year increase[3] - Adjusted EBITDA for the first quarter reached $32.3 million, up 41% sequentially from $22.8 million[3] - Revenues for the three months ended March 31, 2025, were $157,140,000, an increase of 16.8% compared to $134,504,000 for the previous quarter[29] - Gross profit for the same period was $42,906,000, representing a gross margin of 27.3%[29] - Adjusted net income for the three months ended March 31, 2025, was $14,336,000, significantly higher than $3,889,000 in the previous quarter[33] - Adjusted net income per share increased to $0.11 for the three months ended March 31, 2025, compared to $0.03 in the previous quarter[33] - Revenues for the three months ended March 31, 2025, totaled $157,140,000, representing an increase from $150,972,000 in the same period of 2024[34] - Adjusted EBITDA for the three months ended March 31, 2025, was $32,267,000, with an adjusted EBITDA margin of 20.5%[34] - Net income before taxes and discontinued operations for the three months ended March 31, 2025, was $5,086,000, compared to $1,295,000 in the same period of 2024[35] - Total Adjusted Free Cash Flow for the three months ended March 31, 2025, was $4,241,000, a significant improvement from a negative $29,617,000 in the same period of 2024[36] - Adjusted EBIT for the twelve months ended March 31, 2025, was $65,902,000, reflecting a significant increase from previous periods[42] Cash Flow and Liquidity - Net cash provided by operating activities was $3.9 million, with free cash flow from the base business at $15.4 million[5] - Liquidity at the end of the first quarter was $208 million, improving to $220 million by April 28, 2025[19] - Net cash provided by operating activities for the three months ended March 31, 2025, was $3,935,000, compared to $5,635,000 in the previous quarter[31] - Cash and cash equivalents increased to $41,000,000 from $36,987,000 in the previous quarter[30] Capital Expenditures and Assets - Capital expenditures totaled $18 million, including $11.2 million for the Arkansas bromine facility[5] - Total current assets rose to $291,054,000 as of March 31, 2025, up from $269,628,000 at the end of the previous quarter[30] - Consolidated total assets increased to $614,085,000 as of March 31, 2025, up from $491,325,000 a year earlier[42] Debt and Leverage - The company reported a net leverage ratio of 1.5X as of March 31, 2025[20] - Net debt as of March 31, 2025, was $139,095,000, a decrease from $142,709,000 as of December 31, 2024[38] - The net leverage ratio as of March 31, 2025, was 1.5, indicating the company's ability to manage its debt relative to its adjusted EBITDA[40] Future Projections - The company expects first half 2025 Adjusted EBITDA to be between $57 million and $65 million, up from previous guidance of $55 million to $65 million[6] - Projected revenues for the first half of 2025 are estimated to be between $315,000,000 and $345,000,000, compared to $322,907,000 for the first half of 2024[44] - Adjusted EBITDA for the projected first half of 2025 is expected to range from $57,000,000 to $65,000,000[44] - Adjusted net income before taxes and discontinued operations for the first half of 2025 is projected to be between $24,000,000 and $35,000,000[44] - Interest expense for the first half of 2024 was $12,137,000, with a projected decrease to between $9,000,000 and $10,000,000 for the first half of 2025[44] Operational Strategy - The company plans to continue focusing on operational efficiency and cost management to enhance profitability in future quarters[32] - The company is exploring potential joint ventures for lithium and bromine extraction, with uncertainties regarding successful negotiations and economic viability[46] Regulatory and Market Conditions - The Arkansas Oil and Gas Commission approved the expansion of the Evergreen Unit for bromine and potential lithium extraction[17] - Forward-looking statements indicate potential risks related to economic conditions and regulatory changes that may impact future performance[45] - The company is positioned to benefit from the growth of Eos Energy Enterprises' battery production, enhancing electrolyte sales[16]

Financial Performance - TETRA Technologies reported a record first-quarter Adjusted EBITDA of $32.3 million, a 41% increase sequentially and year-over-year, driven by strong performance in Completion Fluids and Products [2][3] - Total revenue for the first quarter was $157 million, reflecting a 17% sequential increase and a 4% increase compared to the previous year [2][8] - Net income before taxes and discontinued operations was $5.1 million, down from $7.4 million in the prior quarter due to unrealized mark-to-market gains [8] Segment Performance - Completion Fluids & Products generated revenue of $93 million, with adjusted EBITDA margins increasing to 35.7% from 27.3% in the previous quarter, supported by stronger deepwater activity [3][9] - Water & Flowback Services experienced a 2% decline in revenue sequentially, but adjusted EBITDA margins improved year-over-year by 340 basis points despite lower frac activity levels [3][11] Outlook and Guidance - The company anticipates a strong second quarter, expecting to benefit from seasonal peaks in European industrial chemicals and the completion of multiple deepwater projects [4] - Adjusted EBITDA guidance for the first half of 2025 has been revised to between $57 million and $65 million, with revenue guidance adjusted to between $315 million and $345 million [4] Cash Flow and Capital Expenditures - TETRA generated $3.9 million in cash from operating activities and $4.2 million in free cash flow during the first quarter, after investing $11.2 million in the Arkansas bromine project [5][18] - Total capital expenditures for the quarter were $18 million, with significant investments directed towards the Arkansas bromine facility [18][20] Balance Sheet and Liquidity - As of March 31, 2025, the company had cash and cash equivalents of $41 million and long-term debt of $180 million, resulting in a net leverage ratio of 1.5X [20][19] - Liquidity improved to $220 million as of April 28, 2025, including an unused $75 million delayed draw feature under the Term Credit Agreement [19] Emerging Growth Initiatives - TETRA is advancing its desalination project, TETRA Oasis TDS, in collaboration with EOG Resources, targeting the recycling of produced water for beneficial reuse [13] - The company is positioned to benefit from increased sales of battery electrolytes to Eos Energy Enterprises as they ramp up production [14]

Core Viewpoint - Tetra Technologies is expected to report a year-over-year increase in earnings and revenues, but actual results compared to estimates will significantly impact its stock price [1][2]. Earnings Expectations - The consensus estimate for Tetra Technologies is an earnings per share (EPS) of $0.08, reflecting a year-over-year increase of +60% [3]. - Expected revenues are $155.83 million, which is a 3.2% increase from the previous year [3]. Estimate Revisions - The consensus EPS estimate has been revised down by 3.85% over the last 30 days, indicating a bearish sentiment among analysts [4]. - The Most Accurate Estimate for Tetra Technologies is lower than the Zacks Consensus Estimate, leading to an Earnings ESP of -25% [10][11]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that a positive or negative reading indicates the likely deviation of actual earnings from the consensus estimate, with a strong predictive power for positive readings [6][7]. - Tetra Technologies currently has a Zacks Rank of 3, making it challenging to predict an earnings beat [11]. Historical Performance - In the last reported quarter, Tetra Technologies was expected to post earnings of $0.04 per share but delivered only $0.03, resulting in a surprise of -25% [12]. - Over the past four quarters, the company has only beaten consensus EPS estimates once [13]. Industry Comparison - FMC Technologies, a peer in the oil and gas services industry, is expected to report an EPS of $0.36, indicating a year-over-year change of +63.6% and revenues of $2.27 billion, up 11.1% [17]. - FMC Technologies has a consensus EPS estimate that has been revised up by 0.1% over the last 30 days, but it also has a negative Earnings ESP of -0.92% [18].