ChampionX(US:CHX)2024-07-24 21:04Revenue Performance - Revenue for the second quarter of 2024 was $893.3 million, a decrease from $922.1 million in the previous quarter[18] - Revenue for the second quarter of 2024 was $893.3 million, a decrease from $926.6 million in the same period last year[26] - Revenue for Q2 2024 was $893 million, a decrease of 4% year-over-year and 3% sequentially, primarily impacted by a $54 million decline in Mexico[27] - Production Chemical Technologies revenue decreased by $20.5 million, or 3%, sequentially to $569.6 million, primarily due to lower sales in Mexico[6] - Reservoir Chemical Technologies revenue increased by $2.4 million, or 10%, sequentially to $27.1 million, driven by higher sales volumes[9] - Production & Automation Technologies revenue was $244.5 million, a decrease of 3% sequentially due to lower customer demand in North America[31] - Drilling Technologies revenue decreased by 4% sequentially to $52.9 million, driven by a lower worldwide rig count[32] Net Income and Profitability - Net income attributable to ChampionX was $52.6 million, down from $112.9 million in the prior quarter[18] - Net income attributable to ChampionX was $52.6 million, compared to $95.8 million in June 2023[26] - The adjusted diluted earnings per share attributable to ChampionX was $0.37, down from $0.51 in June 2023[23] - Total segment operating profit was $123.8 million, down from $135.2 million in the previous year[21] - Segment operating profit for Production Chemical Technologies was $85,388, down from $87,163 in June 2023, reflecting a decrease of 2%[49] - Segment operating profit for Drilling Technologies fell sharply to $11,863 from $44,402 in the previous quarter, a decline of 73%[49] Cash Flow and Liquidity - Cash from operating activities was $67.6 million, with free cash flow of $38.3 million, marking the ninth consecutive quarter of positive free cash flow[1] - Cash flows from operating activities amounted to $67.6 million, while free cash flow was $38.3 million[26] - Cash flow from operating activities was $68 million, representing 129% of net income, and free cash flow was $38 million, returning 27% of cash from operating activities to shareholders[28] - The company ended Q2 2024 with approximately $1.1 billion in liquidity, including $393 million in cash and $672 million available on its revolving credit facility[29] - Free cash flow for the three months ended June 30, 2024, was $38,315, significantly lower than $143,986 in the previous quarter, representing a decline of 73%[50] - The cash from operating activities to revenue ratio dropped to 8% from 13% year-over-year[50] - Free cash flow to revenue ratio decreased to 4% from 10% year-over-year[50] Adjusted EBITDA - Adjusted EBITDA was $183.2 million, with an adjusted EBITDA margin of 20.5%[1] - Adjusted EBITDA for the quarter was $183.2 million, with an adjusted EBITDA margin of 20.5%[26] - Segment adjusted EBITDA for Production & Automation Technologies was $58,848, down 3% from $60,641 in June 2023[49] - Segment adjusted EBITDA for Reservoir Chemical Technologies increased to $5,954, up 11% from $4,385 in June 2023[49] Acquisitions and Strategic Developments - The acquisition of RMSpumptools Limited was completed, enhancing ChampionX's Production and Automation Technologies portfolio[4] - ChampionX was awarded an Integrated Production project for three well pads comprising 16 wells in the Permian basin, highlighting its project management capabilities[35] - A merger agreement was announced for SLB to purchase ChampionX in an all-stock transaction, expected to close in Q4 2024 or Q1 2025, pending regulatory approvals[29] Balance Sheet and Assets - Total assets increased to $3.29 billion from $3.24 billion at the end of the previous quarter[19] - Current liabilities decreased to $727.7 million from $782.7 million in the previous quarter[19] Other Financial Metrics - The company reported a loss on the Argentina Blue Chip Swap transaction of $2.994 million during the quarter[22] - Capital expenditures for the period were $65.3 million, compared to $57.3 million in the same period last year[20] - The company experienced a net cash increase of $104.7 million, up from $12.9 million in the previous year[20] - The company aims for at least 50% adjusted EBITDA to free cash flow conversion for 2024, reflecting confidence in its financial performance[28] - Non-GAAP adjustments for Corporate and other segments were $12,488, significantly higher than $2,299 in the previous quarter[49] - The company reported a segment operating loss of $(40,562) for Corporate and other, worsening from $(26,935) in June 2023[49]