MRC (US:MRC)2025-11-05 11:45Financial Performance - Third quarter 2025 sales were $678 million, a 12% decrease year-over-year and a 15% decrease sequentially [6][13]. - Net loss from continuing operations for Q3 2025 was $9 million, compared to net income of $29 million in Q3 2024 [4][7]. - Adjusted EBITDA for Q3 2025 was $36 million, or 5.3% of sales, down from $47 million, or 6.1% of sales in Q3 2024 [10]. - Gross profit for Q3 2025 was $125 million, or 18.4% of sales, compared to $157 million, or 20.4% of sales in Q3 2024 [8]. - U.S. sales in Q3 2025 were $550 million, a 15% decrease from Q3 2024, with all sectors experiencing declines due to ERP system challenges [14][15]. - The company reported a net loss of $9 million for the three months ended September 30, 2025, compared to a net income of $29 million for the same period in 2024, indicating a significant decline in profitability [39]. - Sales for the three months ended September 30, 2025, were $678 million, a decrease of 12.1% from $771 million in the same period of 2024 [39]. - Gross profit for the three months ended September 30, 2025, was $125 million, down from $157 million in the prior year, reflecting a decrease of 20.4% [39]. - Net income for the nine months ended September 30, 2025, was $12 million, a decrease from $79 million in the same period of 2024 [41]. - Total sales for the nine months ended September 30, 2025, were $2,188 million, down from $2,347 million in 2024, representing a decrease of approximately 6.8% [44]. - Adjusted EBITDA for the nine months ended September 30, 2025, was $126 million, down from $169 million in 2024 [57]. - Adjusted net income from continuing operations for the three months ended September 30, 2025, was $11 million, while for the same period in 2024, it was $24 million [61]. - For the nine months ended September 30, 2025, the adjusted net income from continuing operations was $81 million [61]. Expenses and Liabilities - Selling, general and administrative (SG&A) expenses were $128 million, or 18.9% of sales, up from $120 million, or 15.6% of sales in Q3 2024 [9]. - Selling, general and administrative expenses for the three months ended September 30, 2025, were $128 million, up from $120 million in the same period of 2024, reflecting an increase of 6.7% [39]. - The company's long-term debt increased to $472 million as of September 30, 2025, compared to $384 million at December 31, 2024, marking an increase of 22.9% [37]. - The company's total current liabilities rose to $588 million as of September 30, 2025, compared to $508 million at December 31, 2024, indicating an increase of 15.7% [37]. - The company incurred $5 million in costs related to ERP system implementation for the three months ended September 30, 2025 [66]. - Non-recurring legal and consulting costs amounted to $5 million for the three months ended September 30, 2025 [66]. Cash Flow and Assets - Cash balance as of September 30, 2025, was $59 million, with long-term debt of $476 million and net debt of $417 million [21]. - MRC Global's total assets increased to $1,795 million as of September 30, 2025, up from $1,624 million at December 31, 2024, representing a growth of approximately 10.5% [37]. - Cash at the end of the period was $59 million, a decrease from $62 million at the end of September 2024 [41]. - The company reported a significant increase in payments on revolving credit facilities, totaling $504 million in 2025 compared to $276 million in 2024 [41]. - The company experienced a decrease in inventories by $129 million for the nine months ended September 30, 2025, compared to an increase of $88 million in 2024 [41]. - MRC Global's accounts receivable rose to $473 million as of September 30, 2025, compared to $378 million at December 31, 2024, an increase of 25.1% [37]. Future Outlook - The company anticipates mid-to-high single-digit percentage revenue growth sequentially for Q4 2025 as backlog is expected to convert to revenue [4][6]. - The merger with DNOW Inc. is expected to close in Q4 2025, which will enhance MRC Global's capabilities and scale [4][23]. - Revenue backlog as of September 30, 2025, was $571 million, a 4% increase year-over-year and a 21% increase in the U.S. segment backlog [6][20].