MRC Global Increases 2022 Full Year Guidance and Announces Preliminary Second Quarter 2022 Results
Raising 2022 Guidance
Strong results in the first half of the year and a positive outlook for each of the company’s end-markets for the remainder of the year support an upward revision to the company’s 2022 forecast.
- Revenue is now targeted to be
$3.3 billion, up from the previous guidance of $3.1 billion, which would be a 24% increase in 2022 revenue over 2021.
- Adjusted EBITDA is targeted to be
$230 million, up from the previous guidance of $200 million, which would be a 58% increase in 2022 adjusted EBITDA over 2021.
- Adjusted EBITDA as a percentage of sales is targeted at approximately 7%, up from the previous guidance of 6.5%, which would be a 150 basis-point improvement over 2021.
The company expects third quarter revenue will be higher than the second quarter with a seasonal decline in the fourth quarter.
Adjusted EBITDA and adjusted EBITDA as a percentage of sales are non-GAAP measures. Please refer to the note regarding adjusted EBITDA below.
Preliminary Second Quarter 2022 Results
Based on preliminary results,
Additional second quarter 2022 earnings and annual outlook information will be provided in the company’s scheduled earnings release and earnings call previously announced.
Non-GAAP Measure (Adjusted EBITDA) Disclosure
Adjusted EBITDA and adjusted EBITDA as a percentage of sales are non-GAAP measures. The company defines adjusted EBITDA as net income plus interest, income taxes, depreciation and amortization, amortization of intangibles and certain other expenses, including non-cash expenses (such as equity-based compensation), plus or minus the impact of its last-in, first-out (LIFO) inventory costing methodology.
Reconciling the company’s preliminary second quarter 2022 adjusted EBITDA (and the resulting adjusted EBITDA percentage of sales) to the company’s preliminary second quarter net income is not reasonably possible as the company has not yet fully closed its second quarter books and there may be variations in sales, selling, general and administrative expense, LIFO expense and income taxes, among other line items. The company will provide a full reconciliation when it finalizes its books, releases its second quarter 2022 results and files its quarterly report on Form 10-Q for the quarter.
Reconciling the company's adjusted EBITDA 2022 target (and its outlook regarding adjusted EBITDA percentage of sales) to annual 2022 outlook regarding the company’s net income is not reasonably possible as the impact from inflation or deflation on indices used to calculate LIFO is not possible to reasonably predict.
The company presents adjusted EBITDA because the company believes adjusted EBITDA is a useful indicator of the company’s operating performance. Among other things, adjusted EBITDA measures the company’s operating performance without regard to certain non-recurring, non-cash or transaction-related expenses. Adjusted EBITDA, however, does not represent and should not be considered as an alternative to net income, cash flow from operations or any other measure of financial performance calculated and presented in accordance with GAAP. Because adjusted EBITDA does not account for certain expenses, its utility as a measure of the company’s operating performance has material limitations. Because of these limitations, the company does not view adjusted EBITDA in isolation or as a primary performance measure and also uses other measures, such as net income and sales, to measure operating performance.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Words such as “will,” “expect,” “expected,” “intend,” “believes,” "on-track," “well positioned,” “strong position,” “looking forward,” “guidance,” “plans,” “can,” "target," "targeted" and similar expressions are intended to identify forward-looking statements.
Statements about the company’s business, including its strategy, its industry, the company’s future profitability, the company’s guidance on its sales, adjusted EBITDA, tax rate, capital expenditures, achieving cost savings and cash flow, debt reduction, liquidity, growth in the company’s various markets and the company’s expectations, beliefs, plans, strategies, objectives, prospects and assumptions are not guarantees of future performance. These statements are based on management’s expectations that involve a number of business risks and uncertainties, any of which could cause actual results to differ materially from those expressed in or implied by the forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors, most of which are difficult to predict and many of which are beyond MRC Global’s control, including the factors described in the company’s
These risks and uncertainties include (among others) decreases in oil and natural gas prices; decreases in oil and natural gas industry expenditure levels, which may result from decreased oil and natural gas prices or other factors;
For a discussion of key risk factors, please see the risk factors disclosed in the company’s
Undue reliance should not be placed on the company’s forward-looking statements. Although forward-looking statements reflect the company’s good faith beliefs, reliance should not be placed on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which may cause the company’s actual results, performance or achievements or future events to differ materially from anticipated future results, performance or achievements or future events expressed or implied by such forward-looking statements. The company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, except to the extent required by law.
Source: MRC Global