Team, Inc. Reports Fourth Quarter and Full Year 2024 Results

Core Viewpoint - Team, Inc. reported significant improvements in its financial performance for the fourth quarter and full year of 2024, driven by operational and commercial initiatives that enhanced margins and cash flow generation [4][6][12]. Fourth Quarter 2024 Highlights - Revenues for Q4 2024 were $213.3 million, slightly down from $214.1 million in the prior year, with a 2.1% revenue growth in the U.S. offset by declines in other international regions [6][7]. - Gross margin increased to $57.3 million, representing 26.9% of revenue, up 330 basis points year-over-year [6][7]. - Adjusted EBITDA improved by 50.5% to $14.6 million, or 6.9% of consolidated revenue, compared to $9.7 million (4.5% of revenue) in Q4 2023 [6][9]. - The net loss for Q4 2024 was $7.2 million, an improvement of $15.9 million from the previous year [6][9]. Full Year 2024 Highlights - Total revenues for 2024 were $852.3 million, a slight decrease from $862.6 million in 2023, with U.S. revenue growth of 2.0% [10][12]. - Gross margin for the year improved to $223.2 million (26.2% of revenue), up from $211.2 million (24.5% of revenue) in 2023 [10][12]. - Adjusted EBITDA for the full year was $54.3 million (6.4% of revenue), a 27.7% increase from $42.5 million (4.9% of revenue) in 2023 [10][12]. - The net loss for 2024 was $38.3 million, a $37.5 million improvement over the net loss of $75.7 million in 2023 [10][12]. Operational and Financial Initiatives - The company generated $21.6 million in cash flow from operations in Q4 2024, a $10.5 million improvement over 2023, and $19.6 million in Free Cash Flow, up $11.5 million from the previous year [4][6]. - Cost optimization initiatives are expected to yield approximately $6 million in annualized savings in 2025 [4]. - The company anticipates mid-single-digit consolidated top line growth in 2025, with a target of at least 15% year-over-year growth in Adjusted EBITDA [4]. Segment Performance - In Q4 2024, the Industrial Heat Treating (IHT) segment generated revenues of $106.4 million, while the Mechanical Services (MS) segment brought in $106.9 million, reflecting slight declines in both segments compared to the previous year [16][40]. - Operating income for the IHT segment increased by 45.4% to $9.5 million, and the MS segment's operating income improved by 51.0% to $8.1 million [16][40]. Balance Sheet and Liquidity - As of December 31, 2024, the company had total liquidity of $77.4 million, including cash and cash equivalents of $31.5 million [22]. - Total debt increased to $325.1 million from $311.4 million at the end of 2023, with net debt at $289.6 million [23]. Refinancing Transaction - On March 13, 2025, the company successfully closed a refinancing transaction that extended term maturities to 2030 and reduced the blended interest rate by over 100 basis points [24].