Mistras (US:MG)2024-08-02 18:49Revenue Performance - Revenue for Q2 2024 was $189.8 million, an increase of $13.7 million, or 7.8%, compared to Q2 2023[107] - Revenue for the first half of 2024 was $374.2 million, an increase of $30.2 million, or 8.8%, compared to the first half of 2023[107] - North America segment revenue for Q2 2024 was $156.4 million, up 7.5% from Q2 2023, driven by increased sales in aerospace and defense and power generation[109] - International segment revenue for Q2 2024 was $34.3 million, a 13.2% increase compared to Q2 2023, primarily due to turnaround projects and growth in aerospace and defense[109] - Total revenue increased by 8.8% for the six months ended June 30, 2024, driven by increased sales volume, with North America segment revenue up 8.6% and international segment revenue up 12.8%[110] Profitability - Gross profit for Q2 2024 was $56.1 million, representing 29.6% of revenue, compared to 28.2% in Q2 2023[106] - Income from operations for Q2 2024 was $12.0 million, or 6.3% of revenue, compared to $3.9 million, or 2.2%, in Q2 2023[106] - Net income for Q2 2024 was $6.4 million, compared to a net income of $0.4 million in Q2 2023[106] - Gross profit increased by $11.4 million, or 11.9%, for the six months ended June 30, 2024, on an 8.8% increase in revenue[118] - Gross profit margin improved to 28.6% for the six months ended June 30, 2024, compared to 27.8% for the same period in 2023[121] - For the three months ended June 30, 2024, income from operations (GAAP) increased by $8.1 million to $18.7 million compared to the same period in 2023[126] - For the six months ended June 30, 2024, income from operations (GAAP) increased by $15.4 million to $32.3 million compared to the same period in 2023[127] - Income from operations before special items (non-GAAP) for the three months ended June 30, 2024, increased by $7.3 million to $18.9 million, representing a 360 basis point increase in margin to 6.6%[126] Cash Flow and Liquidity - The company had a cash balance of approximately $17.2 million as of June 30, 2024, indicating strong liquidity[102] - Net cash provided by operating activities for the six months ended June 30, 2024, was $5.1 million, a decrease of $13.2 million or 72% year-on-year[132] - Net cash used in investing activities for the six months ended June 30, 2024, was $11.2 million, compared to $9.8 million in the same period in 2023[133] - Net cash provided in financing activities was $5.3 million for the six months ended June 30, 2024, compared to net cash used of $11.2 million in the same period in 2023[134] - As of June 30, 2024, the company had cash and cash equivalents totaling $17.2 million and $102.5 million of unused commitments under its Credit Agreement[136] Operating Expenses - Operating expenses decreased by $4.0 million for the six months ended June 30, 2024, primarily due to reductions in prior year expenses[124] - Selling, general, and administrative expenses decreased by $2.2 million for the six months ended June 30, 2024, attributed to prior year reductions and favorable foreign currency exchange[124] Market Conditions - Ongoing geopolitical conflicts are causing disruptions in the oil and gas market, particularly affecting operations in Europe due to increased energy costs[101] - Oil and gas customer revenue accounted for approximately 58% of total revenue for the three months ended June 30, 2024, compared to 60% for the same period in 2023[110] - Upstream oil and gas customer revenue increased by approximately $5.2 million, or 7%, for the six months ended June 30, 2024, compared to the same period in 2023[112] - Downstream customer revenue rose by $14.3 million, or 18%, for the six months ended June 30, 2024, due to increased sales volume at customer refineries[113] - Field Services revenue increased by $35.1 million for the six months ended June 30, 2024, driven by higher sales volume in the oil and gas market[114] Customer Concentration - The company's top ten customers represented approximately 35% of total revenue for the six months ended June 30, 2024, consistent with the prior year[111] Taxation - The effective income tax rate for the six months ended June 30, 2024, was approximately 14.9%, down from 21.5% in the same period in 2023[129] Growth and Development - The company experienced overall organic growth during the six months ended June 30, 2024, along with decreased reorganization costs[127] - The company continues to enhance its asset protection solutions through the MISTRAS OneSuite platform, which integrates over 90 applications[100]