Team(US:TISI)2026-03-12 20:26Revenue Performance - Total revenues increased by $44.2 million or 5.2% year-over-year, reaching $896.5 million in 2025, with a $2.3 million positive impact from favorable foreign exchange rates [136]. - IHT segment revenues rose by $32.2 million or 7.5%, primarily due to a $24.3 million increase in U.S. operations driven by higher call-out and turnaround activity [137]. - MS segment revenues increased by $12.1 million or 2.8%, attributed to a $14.6 million rise in U.S. operations, offset by a $9.9 million decline in international operations [137]. Operating Income and Expenses - Operating income increased by $3.9 million to $14.1 million in 2025, with IHT's operating income up by 18.5% to $43.9 million [138]. - Total operating income excluding non-core expenses increased by $10.2 million to $25.9 million, reflecting a 64.7% year-over-year growth [140]. - Interest expense decreased by $3.1 million to $44.7 million, primarily due to lower interest rates from refinancing activities [141]. Debt and Financing Activities - The company completed a $225.0 million senior secured first lien term loan refinancing on March 12, 2025, maturing in 2030 [129]. - On September 11, 2025, the company issued 75,000 shares of Series B Preferred Stock and warrants for total consideration of $75.0 million to repay outstanding loans and cover transaction expenses [132]. - The company incurred a loss on debt extinguishment of $11.9 million related to refinancing transactions completed on March 12, 2025 [142]. Tax and Net Loss - The provision for income tax was $2.6 million on a pre-tax loss of $46.6 million for the year ended December 31, 2025, compared to a provision of $3.3 million on a pre-tax loss of $35.0 million for 2024, resulting in effective tax rates of 5.5% and 9.4% respectively [144]. - Adjusted net loss for the twelve months ended December 31, 2025, was $24.5 million, improving from an adjusted net loss of $32.9 million in 2024, with adjusted net loss per share of $6.20 compared to $7.43 [152]. - The company reported a net loss of $49.2 million for the twelve months ended December 31, 2025, compared to a net loss of $38.3 million in 2024 [152]. Cash Flow and Liquidity - Free cash flow for the year ended December 31, 2025, was negative $20.6 million, a decline from positive $13.3 million in 2024, reflecting challenges in cash generation [152]. - Cash and cash equivalents totaled $18.1 million as of December 31, 2025, down from $35.5 million in 2024, indicating a significant reduction in liquidity [166]. - Operating activities generated a cash outflow of $11.3 million in 2025, a decline of $34.1 million compared to a cash inflow of $22.8 million in 2024 [166]. Working Capital and Investments - Changes in working capital items used $31.3 million in cash flows during the twelve months ended December 31, 2025, a $36.0 million increase compared to $4.7 million in 2024 [171]. - For the year ended December 31, 2025, net cash used in investing activities was $9.1 million, consisting of $9.3 million in capital expenditures [172]. Financing Activities - For the year ended December 31, 2025, net cash provided by financing activities totaled $2.8 million, primarily from $175.0 million borrowing under the new First Lien Term Loan [173]. - The company incurred $11.3 million in debt issuance costs related to refinancing transactions completed as of March 12, 2025 [173]. - For the year ended December 31, 2024, net cash used in financing activities was $12.7 million, primarily due to $8.5 million in debt issuance costs [174]. Foreign Exchange and Tax Positions - The effect of foreign exchange rate changes on cash was a positive impact of $0.2 million for the year ended December 31, 2025, compared to a negative impact of $0.6 million in 2024 [175]. - The company recognizes deferred tax assets to the extent that they are more likely than not to be realized, considering various factors [179]. - The company establishes reserves for uncertain tax positions when it is not more likely than not that the position will be sustained upon challenge [180]. Compliance and Off-Balance Sheet Arrangements - The company remains in compliance with its debt covenants as of December 31, 2025, but future compliance is dependent on operational performance [163]. - The company engages in off-balance sheet arrangements that may give rise to material obligations [176].