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Business Wire
a day ago
- Business
- Business Wire
DNOW and MRC Global to Combine in All-Stock Transaction Creating a Premier Energy and Industrial Solutions Provider
HOUSTON--(BUSINESS WIRE)--DNOW Inc. (NYSE: DNOW) ('DNOW' or 'the Company') and MRC Global Inc. (NYSE: MRC) ('MRC Global') today announced that they have entered into a definitive merger agreement pursuant to which DNOW will acquire MRC Global in an all-stock transaction valued at approximately $1.5 billion, inclusive of MRC Global's net debt, creating a premier energy and industrial solutions provider. The combination brings together two global energy and industrial infrastructure organizations with a complementary portfolio of high-quality products, services and supply chain solutions and an expanded footprint of more than 350 service and distribution locations across more than 20 countries. By integrating both companies' expertise in serving energy, gas utility and industrial customers, the combined company will have greater scale and deliver enhanced capabilities across the value chain. Under the terms of the agreement, MRC Global shareholders will receive 0.9489 shares of DNOW common stock for each share of MRC Global common stock, representing a 8.5% premium to MRC Global's 30-day volume weighted average price ('VWAP') of $12.77 as of June 25, 2025. The exchange ratio, together with the closing prices of DNOW and MRC Global on June 25, 2025, results in a combined company enterprise value of approximately $3.0 billion. Upon completion of the transaction, DNOW and MRC Global shareholders will respectively own approximately 56.5% and approximately 43.5% of the combined company on a fully diluted basis. The transaction has received unanimous approval by both DNOW and MRC Global Board of Directors. 'The combination of DNOW and MRC Global will create a premier energy and industrial solutions provider with a balanced portfolio of businesses and a diversified customer base fortifying long-term profitability and cash flow generation,' said DNOW President and CEO David Cherechinsky. 'MRC Global's differentiated product offerings and complementary assets strengthen DNOW's 160-year legacy as a worldwide supplier of energy and industrial products and packaged, engineered process and production equipment. We look forward to welcoming the MRC Global family to DNOW and bringing our organizations together to drive enhanced growth and value for our customers, partners and shareholders.' Rob Saltiel, MRC Global's President and CEO, stated, 'Bringing our two companies together advances our shared goal of becoming a premier choice for energy, gas utility and industrial customers seeking exceptional service and solutions for the largest and most complex industry needs. The transaction diversifies our product offerings for our customers and de-risks our business. DNOW's long-standing reputation, robust capabilities and broad global presence make it the ideal partner for MRC Global, as our two great companies continue to grow and compete in an expanding global market. Importantly, we have aligned corporate values and a shared commitment to delighting our customers through operational excellence and a culture of outstanding service. This is an exciting milestone for MRC Global, and I am grateful to our team members around the world whose dedication to our business and our customers continues to drive our success.' Compelling Transaction Benefits The combination of DNOW and MRC Global is expected to result in significant strategic, operational and financial benefits to shareholders, including: Combines Highly Complementary Businesses. The combined company will offer distinctive and complementary products and services to the energy and industrial sectors across upstream, midstream, downstream, gas utility and industrial customers. The combined company is anticipated to have compelling and diverse growth opportunities and cash flow levers to reduce earnings volatility and enhanced resilience through business cyclicality in the energy sectors. Core to this will be serving a broader mix of customers in the construction and maintenance of essential energy process, production and transmission infrastructure. Additionally, the merger will allow for enhanced opportunities in alternative energy, artificial intelligence infrastructure, electrification, mining and other industrial markets. Expands Scale and Scope. Together, the combined company will have an expanded geographic footprint and distribution presence in the U.S., Canada and attractive international markets, with approximately 5,000 team members. The expanded range of products and solutions are expected to strengthen existing customer and supplier relationships and facilitate the creation of new ones. Unlocks Meaningful Synergies. The combined company is expected to generate $70 million of annual cost synergies within three years following closing through public company costs, corporate and IT systems, and operational and supply chain efficiencies. The combination is also expected to accelerate growth and deliver double digit Adjusted EPS accretion in the first year following closing. Strong Cash Flow Generation. The substantial cash flow generation expected to result from the combination will enable the combined company to continue the execution of its capital allocation strategy, prioritizing organic investments in growth and productivity-enhancing technologies and investments that yield efficiencies and create value for customers. Maintaining a disciplined approach to capital allocation, the combined company expects to continue strategic acquisitions and return capital to shareholders. Robust Balance Sheet to Pursue Further Growth. Following closing, the combined company is expected to maintain a strong balance sheet with a streamlined capital structure. Post-closing, DNOW expects net leverage to be under 0.5x. With strong cash flow and synergy realization, the combined company expects to achieve rapid deleveraging and have a net cash position by the end of the first year post closing. In addition to over $200 million of cash and a $500 million revolving credit facility, DNOW has secured commitments to expand its existing credit facility by $250 million at the close of the merger, further enhancing its liquidity and capital allocation flexibility. Leadership, Corporate Governance and Headquarters Upon completion of the transaction, David Cherechinsky, President and Chief Executive Officer of DNOW, will serve as President and Chief Executive Officer of the combined company, and Mark Johnson, Chief Financial Officer of DNOW, will serve as Chief Financial Officer of the combined company. Following closing, DNOW's Board of Directors will expand from eight to 10 directors to include two of MRC Global's current independent board members. Dick Alario will continue to serve as Chairman of the Board. The combined company will be named DNOW and trade on the NYSE under the DNOW ticker. The DNOW and MRC Global brands will continue following closing of the transaction. The combined company will remain headquartered in Houston, Texas. Approvals and Closing The transaction is currently anticipated to close in the fourth quarter of 2025, subject to obtaining DNOW and MRC Global shareholder approval and regulatory clearances and satisfaction of other customary closing conditions. Advisors Goldman Sachs & Co. LLC is serving as exclusive financial advisor to DNOW and has provided committed financing, and Kirkland Ellis is serving as legal advisor. Joele Frank is serving as DNOW's strategic communications advisor. J.P. Morgan Securities LLC is serving as exclusive financial advisor to MRC Global, and Akin Gump Strauss Hauer & Feld LLP is serving as legal advisor. Collected Strategies is serving as MRC Global's strategic communications advisor. Conference Call and Webcast Information DNOW and MRC Global leadership will host a conference call and online webcast at 5:15pm U.S. Eastern Time on Thursday, June 26, 2025, to discuss the transaction. Interested U.S. parties may call 800-343-4849 and international participants should call 203-518-9848. All participants should use the access code: 632871. Please dial in at least 10 minutes before the call start time to ensure that you are connected to the call and to register your name and company. Those who wish to listen to the live conference call and view the accompanying presentation slides should visit the News & Events tab of the Investor Relations section of DNOW's website at or MRC Global's website at The press release and presentation slides for the call will be posted to the Investor Relations section of each company's website prior to the call. A replay of the webcast can also be accessed via the Investor Relations section of each company's website. About DNOW DNOW is a supplier of energy and industrial products and packaged, engineered process and production equipment with a legacy of over 160 years. Headquartered in Houston, Texas, with approximately 2,600 employees and a network of locations, we offer a broad set of supply chain solutions combined with a suite of digital offerings branded as DigitalNOW® that provide customers access to highly complementary digital commerce, data and information management channels. Our locations provide products and solutions to exploration and production, midstream transmission and storage companies, refineries, chemical companies, utilities, mining, municipal water, manufacturers, engineering and construction as well as companies operating in the decarbonization, energy evolution and renewables end markets. About MRC Global Headquartered in Houston, Texas, MRC Global (NYSE: MRC) is the leading global distributor of pipe, valves, fittings (PVF) and other infrastructure products and services to diversified end-markets including the gas utilities, downstream, industrial and energy transition, and production and transmission infrastructure sectors. With over 100 years of experience, MRC Global has provided customers with innovative supply chain solutions, technical product expertise and a robust digital platform from a worldwide network of approximately 200 locations including valve and engineering centers. The company's unmatched quality assurance program offers approximately 200,000 SKUs from over 7,100 suppliers, simplifying the supply chain for over 8,300 customers. Find out more at Forward-Looking Statements This press release includes 'forward-looking statements' as defined under the federal securities laws. All statements other than statements of historical fact included or incorporated by reference in this press release, including, among other things, statements regarding the proposed business combination transaction between DNOW and MRC Global, future events, plans and anticipated results of operations, business strategies, the anticipated benefits of the proposed transaction, the anticipated impact of the proposed transaction on the combined company's business and future financial and operating results, the expected amount and timing of synergies from the proposed transaction, the anticipated closing date for the proposed transaction and other aspects of DNOW's or MRC Global's operations or operating results are forward-looking statements. Words and phrases such as 'ambition,' 'anticipate,' 'estimate,' 'believe,' 'budget,' 'continue,' 'could,' 'intend,' 'may,' 'plan,' 'potential,' 'predict,' 'seek,' 'should,' 'will,' 'would,' 'expect,' 'objective,' 'projection,' 'forecast,' 'goal,' 'guidance,' 'outlook,' 'effort,' 'target,' the negative of such terms or other variations thereof and words and terms of similar substance used in connection with any discussion of future plans, actions, or events can be used to identify forward-looking statements. However, the absence of these words does not mean that the statements are not forward-looking. Where, in any forward-looking statement, DNOW or MRC Global expresses an expectation or belief as to future results, such expectation or belief is expressed in good faith and believed to be reasonable at the time such forward-looking statement is made. However, these statements are not guarantees of future performance and involve certain risks, uncertainties and other factors beyond DNOW's or MRC Global's control. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in the forward-looking statements. The following important factors and uncertainties, among others, could cause actual results or events to differ materially from those described in forward-looking statements: DNOW's ability to successfully integrate MRC Global's businesses and technologies, which may result in the combined company not operating as effectively and efficiently as expected; the risk that the expected benefits and synergies of the proposed transaction may not be fully achieved in a timely manner, or at all; the risk that DNOW or MRC Global will be unable to retain and hire key personnel; the risk associated with each party's ability to obtain the approval of its shareholders required to consummate the proposed transaction and the timing of the closing of the proposed transaction, including the risk that the conditions to the transaction are not satisfied on a timely basis or at all or the failure of the transaction to close for any other reason or to close on the anticipated terms, including the anticipated tax treatment; the risk that any regulatory approval, consent or authorization that may be required for the proposed transaction is not obtained or is obtained subject to conditions that are not anticipated; the occurrence of any event, change or other circumstance that could give rise to the termination of the proposed transaction; unanticipated difficulties, liabilities or expenditures relating to the transaction; the effect of the announcement, pendency or completion of the proposed transaction on the parties' business relationships and business operations generally; the effect of the announcement or pendency of the proposed transaction on the parties' common stock prices and uncertainty as to the long-term value of DNOW's or MRC Global's common stock; risks that the proposed transaction disrupts current plans and operations of DNOW or MRC Global and their respective management teams and potential difficulties in hiring or retaining employees as a result of the proposed transaction; rating agency actions and DNOW's and MRC Global's ability to access short- and long-term debt markets on a timely and affordable basis; changes in commodity prices, including a prolonged decline in these prices relative to historical or future expected levels; global and regional changes in the demand, supply, prices, differentials or other market conditions affecting oil and gas, including changes resulting from any ongoing military conflict, including the conflicts in Ukraine and the Middle East, and the global response to such conflict, security threats on facilities and infrastructure, or from a public health crisis or from the imposition or lifting of crude oil production quotas or other actions that might be imposed by Organization of Petroleum Exporting Countries and other producing countries and the resulting company or third-party actions in response to such changes; legislative and regulatory initiatives addressing global climate change or other environmental concerns; public health crises, including pandemics and epidemics and any impacts or related company or government policies or actions; investment in and development of competing or alternative energy sources; international monetary conditions and exchange rate fluctuations; changes in international trade relationships or governmental policies, including the imposition of price caps, or the imposition of trade restrictions or tariffs on any materials or products used in the operation of DNOW's or MRC Global's business, including any sanctions imposed as a result of any ongoing military conflict, including the conflicts in Ukraine and the Middle East; DNOW's or MRC Global's ability to collect payments when due; DNOW's or MRC Global's ability to complete any dispositions or acquisitions on time, if at all; the possibility that regulatory approvals for any dispositions or acquisitions will not be received on a timely basis, if at all, or that such approvals may require modification to the terms of those transactions or DNOW's or MRC Global's remaining businesses; business disruptions following any dispositions or acquisitions, including the diversion of management time and attention; potential liability for remedial actions under existing or future environmental regulations; potential liability resulting from pending or future litigation; the impact of competition and consolidation in the oil and natural gas industry; limited access to capital or insurance or significantly higher cost of capital or insurance related to illiquidity or uncertainty in the domestic or international financial markets or investor sentiment; general domestic and international economic and political conditions or developments, including as a result of any ongoing military conflict, including the conflicts in Ukraine and the Middle East; changes in fiscal regime or tax, environmental and other laws applicable to DNOW's or MRC Global's businesses; disruptions resulting from accidents, extraordinary weather events, civil unrest, political events, war, terrorism, cybersecurity threats or information technology failures, constraints or disruptions; and other economic, business, competitive and/or regulatory factors affecting DNOW's or MRC Global's businesses generally as set forth in their filings with the Securities and Exchange Commission (the 'SEC'). The registration statement on Form S-4 and joint proxy statement/prospectus that will be filed with the SEC will describe additional risks in connection with the proposed transaction. While the list of factors presented here is, and the list of factors to be presented in the registration statement on Form S-4 and joint proxy statement/prospectus are considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. For additional information about other factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to DNOW's and MRC Global's respective periodic reports and other filings with the SEC, including the risk factors contained in DNOW's and MRC Global's most recent Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K. Forward-looking statements represent current expectations and are inherently uncertain and are made only as of the date hereof (or, if applicable, the dates indicated in such statement). Except as required by law, neither DNOW nor MRC Global undertakes or assumes any obligation to update any forward-looking statements, whether as a result of new information or to reflect subsequent events or circumstances or otherwise. No Offer or Solicitation This press release is not intended to and shall not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities, or a solicitation of any vote or approval, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made, except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended. Additional Information about the Merger and Where to Find It In connection with the proposed transaction, DNOW intends to file with the SEC a registration statement on Form S-4 that will include a joint proxy statement of DNOW and MRC Global that also constitutes a prospectus of DNOW common shares to be offered in the proposed transaction. Each of DNOW and MRC Global may also file other relevant documents with the SEC regarding the proposed transaction. This press release is not a substitute for the joint proxy statement/prospectus or registration statement or any other document that DNOW or MRC Global may file with the SEC. The definitive joint proxy statement/prospectus (if and when available) will be mailed to shareholders of DNOW and MRC Global. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT, JOINT PROXY STATEMENT/PROSPECTUS, AND ANY OTHER RELEVANT DOCUMENTS THAT MAY BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security holders will be able to obtain free copies of the registration statement and joint proxy statement/prospectus (if and when available) and other documents containing important information about DNOW, MRC Global and the proposed transaction, once such documents are filed with the SEC through the website maintained by the SEC at Copies of the documents filed with the SEC by DNOW will be available free of charge on DNOW's website at or by contacting DNOW's Investor Relations Department by email at ir@ or by phone at (281) 823-4006. Copies of the documents filed with the SEC by MRC Global will be available free of charge on MRC Global's website at or by contacting MRC Global's Investor Relations Department by email at or by phone at (832) 308-2847. Participants in the Solicitation DNOW, MRC Global and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information about the directors and executive officers of DNOW, including a description of their direct or indirect interests, by security holdings or otherwise, is set forth in (i) DNOW's proxy statement for its 2025 annual meeting of shareholders, which was filed with the SEC on April 4, 2025, (ii) DNOW's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, which was filed with the SEC on February 18, 2025 and (iii) to the extent holdings of DNOW securities by its directors or executive officers have changed since the amounts set forth in DNOW's proxy statement for its 2025 annual meeting of shareholders, such changes have been or will be reflected on Initial Statement of Beneficial Ownership of Securities on Form 3, Statement of Changes in Beneficial Ownership on Form 4 or Annual Statement of Changes in Beneficial Ownership of Securities on Form 5, filed with the SEC. Information about the directors and executive officers of MRC Global, including a description of their direct or indirect interests, by security holdings or otherwise, is set forth in (i) MRC Global's proxy statement for its 2025 annual meeting of shareholders, which was filed with the SEC on April 17, 2025, (ii) MRC Global's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, which was filed with the SEC on March 14, 2025 and (iii) to the extent holdings of MRC Global securities by its directors or executive officers have changed since the amounts set forth in MRC Global's proxy statement for its 2025 annual meeting of shareholders, such changes have been or will be reflected on Initial Statement of Beneficial Ownership of Securities on Form 3, Statement of Changes in Beneficial Ownership on Form 4, or Annual Statement of Changes in Beneficial Ownership of Securities on Form 5, filed with the SEC. Other information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the proposed transaction when such materials become available. Investors should read the joint proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. Copies of the documents filed with the SEC by DNOW and MRC Global will be available free of charge through the website maintained by the SEC at Additionally, copies of documents filed with the SEC by DNOW will be available free of charge on DNOW's website at and those filed by MRC Global will be available free of charge on MRC Global's website at Use of Non-GAAP Financial Information and Other Terms This press release contains certain financial measures that are not prepared in accordance with GAAP, including certain forward-looking projections that are not reconcilable with GAAP measures due to their inherent uncertainty. Due to the forward-looking nature of certain measures used herein, management cannot reliably predict certain of the necessary components of the most directly comparable forward-looking GAAP measures. Accordingly, the Company is unable to present a quantitative reconciliation of such forward-looking non-GAAP financial measures to their most directly comparable forward-looking GAAP financial measures without unreasonable effort. Amounts excluded from these non-GAAP measures in future periods could be significant.
Globe and Mail
16-04-2025
- Business
- Globe and Mail
MRC Global Announces Preliminary First Quarter 2025 Results
HOUSTON, April 16, 2025 (GLOBE NEWSWIRE) -- MRC Global Inc. (NYSE: MRC) today announced selected preliminary first quarter 2025 results from continuing operations. Preliminary First Quarter 2025 Financial Highlights: Revenue of approximately $710 million, a 7% sequential increase Net income from continuing operations of approximately $7 million Adjusted EBITDA of approximately $35 million, or 4.9% of sales Gross Profit of approximately $142 million, or 20.0% of sales Adjusted Gross Profit of approximately $153 million, or 21.5% of sales Cash flow provided by continuing operations of approximately $20 million Rob Saltiel, MRC Global's President and CEO stated, 'I am very pleased with our strong start to the year, with activity levels and margins exceeding expectations. Our US segment drove the sequential revenue increase, led by 13% growth in DIET, 8% in Gas Utilities and 6% in PTI. We are optimistic about continued revenue growth in the second quarter, and we estimate a high-single to low-double digit percentage increase in sequential sales supported by our growing US backlog, which is up more than 20% since the beginning of this year. 'Although we recognize the potential for headwinds in the global economy, we believe the strong rebound in our Gas Utilities business, coupled with healthy activity levels in DIET and a favorable PTI customer mix, position us well for future success. The recent volatility in our share price also provides an opportunity for us to begin execution of our $125 million share repurchase program in the second quarter.' Additional first quarter 2025 earnings and annual outlook information will be provided in the company's upcoming earnings release and earnings call in May. Adjusted Gross Profit and Adjusted EBITDA are non-GAAP measures. Please refer to the reconciliations of Adjusted Gross Profit and Adjusted EBITDA to their nearest GAAP measures in this release. As used in this release, DIET refers to business in our downstream, industrial and energy transition sector, and PTI refers to business in our production and transmission infrastructure sector with respect to our upstream and midstream oil and gas customers. The company has prepared the estimates presented above in good faith based upon the company's internal reporting and expectations as of and for the three months ended March 31, 2025. These estimates are preliminary, unaudited, subject to completion, reflect the company's current good faith estimates and may be revised as a result of management's further review of the company's results. The company and its auditors have not completed the normal quarterly review procedures as of and for the three months ended March 31, 2025, and there can be no assurance that the company's final results for this quarterly period will not differ from these estimates. Any such differences could be material. During the course of the preparation of the company's consolidated financial statements and related notes as of and for the three months ended March 31, 2025, the company may identify items that would require it to make material adjustments to the preliminary financial information. These estimates should not be viewed as a substitute for full interim financial statements prepared in accordance with GAAP. In addition, these preliminary estimates as of and for the three months ended March 31, 2025 are not necessarily indicative of the results to be achieved for the remainder of 2025 or any future period. About MRC Global Inc. Headquartered in Houston, Texas, MRC Global (NYSE: MRC) is the leading global distributor of pipe, valves, fittings (PVF) and other infrastructure products and services to diversified end-markets including the gas utilities, downstream, industrial and energy transition, and production and transmission infrastructure sectors. With over 100 years of experience, MRC Global has provided customers with innovative supply chain solutions, technical product expertise and a robust digital platform from a worldwide network of approximately 200 locations including valve and engineering centers. The company's unmatched quality assurance program offers approximately 200,000 SKUs from over 7,100 suppliers, simplifying the supply chain for over 8,300 customers. Find out more at 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, ' ' estimate ', ' believe ' 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 increase for its second quarter of 2025 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 SEC filings that may cause the company ' s actual results and performance to be materially different from any future results or performance expressed or implied by these forward-looking statements. 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; U.S. and international general economic conditions; the company's ability to compete successfully with other companies in MRC Global's industry; the risk that manufacturers of the products the company distributes will sell a substantial amount of goods directly to end users in the industry sectors the company serves; unexpected supply shortages; cost increases by the company's suppliers; the company's lack of long-term contracts with most of its suppliers; suppliers' price reductions of products that the company sells, which could cause the value of the company's inventory to decline; decreases in steel prices, which could significantly lower MRC Global's profit; increases in steel prices, which the company may be unable to pass along to its customers which could significantly lower its profit; the company's lack of long-term contracts with many of its customers and the company's lack of contracts with customers that require minimum purchase volumes; changes in the company's customer and product mix; risks related to the company's customers' creditworthiness; the success of the company's acquisition strategies; the potential adverse effects associated with integrating acquisitions into the company's business and whether these acquisitions will yield their intended benefits; the company's significant indebtedness; the dependence on the company's subsidiaries for cash to meet its obligations; changes in the company's credit profile; a decline in demand for certain of the products the company distributes if import restrictions on these products are lifted or imposed; significant substitution of alternative fuels for oil and gas; environmental, health and safety laws and regulations and the interpretation or implementation thereof; the sufficiency of the company's insurance policies to cover losses, including liabilities arising from litigation; product liability claims against the company; pending or future asbestos-related claims against the company; the potential loss of key personnel; adverse health events such as a pandemic; interruption in the proper functioning of the company's information systems and the occurrence of cyber security incidents; loss of third-party transportation providers; potential inability to obtain necessary capital; risks related to adverse weather events or natural disasters; impairment of the company ' s goodwill or other intangible assets; adverse changes in political or economic conditions in the countries in which the company operates; exposure to U.S. and international laws and regulations, including the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act and other economic sanction programs; risks associated with international stability and geopolitical developments; risks relating to ongoing evaluations of internal controls required by Section 404 of the Sarbanes-Oxley Act; risks related to the company's intention not to pay dividends; and risks arising from compliance with and changes in law in the countries in which we operate, including (among others) changes in tax law, tax rates and interpretation in tax laws. For a discussion of key risk factors, please see the risk factors disclosed in the company ' s SEC filings, which are available on the SEC ' s website at and on the company ' s website, MRC Global ' s filings and other important information are also available on the Investor Relations page of the company ' s website at 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. MRC Global Inc. Supplemental Information (Unaudited) Reconciliation of Net Income from Continuing Operations to Adjusted EBITDA (a non-GAAP measure) (in millions) Three Months Ended March 31, Percentage 2025 of Revenue Net income from continuing operations $ 7 1.0 % Income tax expense 1 0.1 % Interest expense 9 1.3 % Depreciation and amortization 5 0.7 % Amortization of intangibles 5 0.7 % Increase in LIFO reserve 1 0.1 % Equity-based compensation expense 4 0.6 % Internal control remediation 2 0.3 % Non-recurring other legal and consulting costs 1 0.1 % Adjusted EBITDA $ 35 4.9 % Notes to above: The company defines Adjusted EBITDA in this release as net income from continuing operations plus interest, income taxes, depreciation and amortization, amortization of intangibles, and certain other expenses, including non-cash expenses, (such as equity-based compensation, severance and restructuring, changes in the fair value of derivative instruments and asset impairments, including inventory), inventory-related charges incremental to normal operations, and plus or minus the impact of its LIFO inventory costing methodology. 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. See the company's Annual Report filed on Form 10-K for a more thorough discussion of the use of Adjusted EBITDA. Three Months Ended March 31, Percentage 2025 of Revenue Gross profit, as reported $ 142 20.0 % Depreciation and amortization 5 0.7 % Amortization of intangibles 5 0.7 % Increase in LIFO reserve 1 0.1 % Adjusted Gross Profit $ 153 21.5 % Notes to above: The company defines Adjusted Gross Profit as sales, less cost of sales, plus depreciation and amortization, plus amortization of intangibles, plus inventory-related charges incremental to normal operations and plus or minus the impact of its LIFO inventory costing methodology. The company presents Adjusted Gross Profit because the company believes it is a useful indicator of the company's operating performance without regard to items, such as amortization of intangibles, that can vary substantially from company to company depending upon the nature and extent of acquisitions of which they have been involved. Similarly, the impact of the LIFO inventory costing method can cause results to vary substantially from company to company depending upon whether they elect to utilize LIFO and depending upon which method they may elect. The company uses Adjusted Gross Profit as a key performance indicator in managing its business. The company believes that gross profit is the financial measure calculated and presented in accordance with U.S. generally accepted accounting principles that is most directly comparable to Adjusted Gross Profit.
Yahoo
07-04-2025
- Business
- Yahoo
Q4 Earnings Highlights: MRC Global (NYSE:MRC) Vs The Rest Of The Infrastructure Distributors Stocks
The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let's take a look at how infrastructure distributors stocks fared in Q4, starting with MRC Global (NYSE:MRC). Focusing on narrow product categories that can lead to economies of scale, infrastructure distributors sell essential goods that often enjoy more predictable revenue streams. For example, the ongoing inspection, maintenance, and replacement of pipes and water pumps are critical to a functioning society, rendering them non-discretionary. Lately, innovation to address trends like water conservation has driven incremental sales. But like the broader industrials sector, infrastructure distributors are also at the whim of economic cycles as external factors like interest rates can greatly impact commercial and residential construction projects that drive demand for infrastructure products. The 4 infrastructure distributors stocks we track reported a satisfactory Q4. As a group, revenues were in line with analysts' consensus estimates. While some infrastructure distributors stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 4.2% since the latest earnings results. Producing bomb casings and tracks for vehicles during WWII, MRC (NYSE:MRC) offers pipes, valves, and fitting products for various industries. MRC Global reported revenues of $664 million, down 13.5% year on year. This print fell short of analysts' expectations by 8.7%. Overall, it was a disappointing quarter for the company with a miss of analysts' Fittings revenue estimates and a significant miss of analysts' adjusted operating income estimates. Rob Saltiel, MRC Global's President and Chief Executive Officer, commented, 'We are optimistic about our business outlook for 2025 due to the rebound of our gas utilities business, the return of inflation to our product pricing, the growth of U.S. natural gas infrastructure investment and our penetration into chemicals, mining and data center markets. We are also very excited to announce today our new IMTEC joint venture which simplifies the development of smart meters for our gas utilities customers. We anticipate growth in all three business sectors in 2025 and for revenue to be up low to high-single digits. In addition, we expect to generate at least $100 million in cash from operations, achieve our target net debt leverage ratio of 1.5x by year end and to have ample cash to begin execution of our recently announced $125 million share buyback authorization.' MRC Global delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. The stock is down 14.5% since reporting and currently trades at $9.50. Read our full report on MRC Global here, it's free. Spun off from National Oilwell Varco, DistributionNOW (NYSE:DNOW) provides distribution and supply chain solutions for the energy and industrial end markets. DistributionNOW reported revenues of $571 million, up 2.9% year on year, outperforming analysts' expectations by 3.4%. The business had an incredible quarter with a solid beat of analysts' EPS estimates and an impressive beat of analysts' EBITDA estimates. The market seems happy with the results as the stock is up 14.7% since reporting. It currently trades at $16.21. Is now the time to buy DistributionNOW? Access our full analysis of the earnings results here, it's free. Formerly a division of industrial distributor HD Supply, Core & Main (NYSE:CNM) is a provider of water, wastewater, and fire protection products and services. Core & Main reported revenues of $1.70 billion, up 17.9% year on year, exceeding analysts' expectations by 1.7%. Still, it was a slower quarter as it posted a significant miss of analysts' EPS estimates and a miss of analysts' adjusted operating income estimates. As expected, the stock is down 12.1% since the results and currently trades at $43.62. Read our full analysis of Core & Main's results here. Originally a manufacturing company, Watsco (NYSE:WSO) today only distributes air conditioning, heating, and refrigeration equipment, as well as related parts and supplies. Watsco reported revenues of $1.75 billion, up 9.4% year on year. This number surpassed analysts' expectations by 5.3%. It was an exceptional quarter as it also recorded a solid beat of analysts' same-store sales and adjusted operating income estimates. Watsco pulled off the biggest analyst estimates beat among its peers. The stock is down 4.9% since reporting and currently trades at $461.82. Read our full, actionable report on Watsco here, it's free. As a result of the Fed's rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed's 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump's victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate. Join Paid Stock Investor Research Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here. Sign in to access your portfolio
Yahoo
14-03-2025
- Business
- Yahoo
MRC Global Announces Joint Venture with Frisbie Measurement Services to Provide Integrated Meter Technical Services
HOUSTON, March 14, 2025 (GLOBE NEWSWIRE) -- MRC Global Inc. (NYSE: MRC) announced that it has entered into a joint venture with Frisbie Measurement Services, LLC (FMS) forming IMTEC Services, a provider of integrated smart meter technical services to the gas utilities sector. IMTEC Services is applying for its certification as a woman-owned business with the Women's Business Enterprise National Council (WBENC). IMTEC Services is a centralized meter center that will integrate meter and electronic meter reading capabilities while maintaining quality and safety. With IMTEC Services, customers will be able to enjoy shorter lead times, resilience against market disruptions, a commitment to regulatory compliance and high-quality meters delivered with precision. 'The smart meter development process has been cumbersome for utilities and manufacturers alike. FMS understands the technical requirements for smart meters and automated meter readers and qualifies IMTEC as a diverse supplier to purchasing utilities. Based on feedback from our gas utility customers, we expect a strong reception,' Rob Saltiel, MRC Global President & CEO, said. Heidi Frisbie, President of FMS, Tecvalco USA and former General Manager, Smart Energy at Honeywell stated, 'FMS' customer-focused energy solutions and MRC Global's extensive inventory experience are well suited for the IMTEC Services joint venture. This combined expertise allows IMTEC Services to offer meter and end point solutions that meet high quality and safety requirements while providing 100% Tier II diverse supplier classification for all meter spending, meeting requirements of state public utility commissions for our gas utility customers.' IMTEC Services will offer a comprehensive meter supply chain and will operate within MRC Global's La Porte, Texas Operations Complex which is centrally located to serve customers throughout the United States. About MRC Global in Houston, Texas, MRC Global (NYSE: MRC) is the leading global distributor of pipe, valves, fittings (PVF) and other infrastructure products and services to diversified end-markets including the gas utilities, downstream, industrial and energy transition, and production and transmission infrastructure sectors. With over 100 years of experience, MRC Global has provided customers with innovative supply chain solutions, technical product expertise and a robust digital platform from a worldwide network of approximately 200 locations including valve and engineering centers. The company's unmatched quality assurance program offers approximately 200,000 SKUs from over 7,100 suppliers, simplifying the supply chain for over 8,300 customers. Find out more at About Frisbie Measurement Services LLC Headquartered in Cleveland, OH, Frisbie Measurement Services, LLC provides comprehensive gas measurement expertise utilizing a team of expert metrology and engineering resources. From proving, trouble shooting, to technical consulting, the company operates with an acute understanding of customer needs and prides itself on delivering customer focused solutions in the metering space. The company is proudly women-owned and led. Contact:Monica BroughtonVP, Investor Relations & Treasury MRC Global Inc. 832-308-2847
Associated Press
14-03-2025
- Business
- Associated Press
MRC Global Reports Full Year and Fourth Quarter 2024 Results
HOUSTON, March 14, 2025 (GLOBE NEWSWIRE) -- MRC Global Inc. (NYSE: MRC) today reported full year and fourth quarter 2024 results. Full Year 2024 Financial Highlights: ● Operating cash flows from continuing operations of $268 million, highest since 2015 ● Sales of $3,011 million ● Net income from continuing operations of $78 million ● Adjusted EBITDA of $202 million, 6.7% of sales ● Gross profit, as a percentage of sales, of 20.6% ● Adjusted Gross Profit, as a percentage of sales, of 21.9% and the third consecutive year above 21% ● Net Debt of $324 million, a 1.6x net debt leverage ratio Fourth Quarter 2024 Financial Highlights: ● Operating cash flows from continuing operations of $73 million ● Sales of $664 million ● Net loss from continuing operations of ($1) million ● Adjusted EBITDA of $32 million, or 4.8% of sales ● Gross profit, as a percentage of sales, of 20.3% ● Adjusted Gross Profit, as a percentage of sales, of 22.0% ● Working capital, as a percentage of sales, of 11.2%, a record low for the company Rob Saltiel, MRC Global's President and Chief Executive Officer, commented, 'We are optimistic about our business outlook for 2025 due to the rebound of our gas utilities business, the return of inflation to our product pricing, the growth of U.S. natural gas infrastructure investment and our penetration into chemicals, mining and data center markets. We are also very excited to announce today our new IMTEC joint venture which simplifies the development of smart meters for our gas utilities customers. We anticipate growth in all three business sectors in 2025 and for revenue to be up low to high-single digits. In addition, we expect to generate at least $100 million in cash from operations, achieve our target net debt leverage ratio of 1.5x by year end and to have ample cash to begin execution of our recently announced $125 million share buyback authorization.' Mr. Saltiel continued, 'Looking back on 2024, I am very pleased with the successful execution of several strategic actions that simplified and strengthened our balance sheet while de-risking our future financing needs. We achieved average annual Adjusted Gross Profit margins that exceeded 21% for the third year in a row. We generated $268 million of operating cash flow from continuing operations, aided by significant improvements in our working capital efficiency, despite a slow finish to the year.' The company previously delayed the release of its financial results to allow additional time to complete year-end procedures specifically related to inventory cycle counts. The completion of these procedures resulted in no adjustments to either the income statement or balance sheet in 2024 or any restatement of prior periods. Consistent with the previously announced sale of the Canada business, Canada results are reflected in discontinued operations for all periods presented. Canada discontinued operational losses including operating losses and the loss incurred on the sale, were ($22) million for the fourth quarter of 2024 and ($23) million for the year ended 2024. The sale is scheduled to close this month. Adjusted Net Income (Loss) from continuing operations, Adjusted Net (Loss) Income Attributable to Common Stockholders, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Gross Profit, Adjusted Gross Profit margin, Net Debt, Net Debt Leverage Ratio and Adjusted selling, general and administrative (SG&A) expense are all non-GAAP measures. Please refer to the reconciliation of each of these measures to the nearest GAAP measure in this release. Net loss from continuing operations for the fourth quarter of 2024 was ($1) million, or ($0.14) per diluted share, as compared to net income from continuing operations of $22 million, or $0.19 per diluted share, in the fourth quarter of 2023. Net income from continuing operations for the full years 2024 and 2023 was $78 million, or $0.57 per diluted share, and $115 million, or $1.06 per diluted share, respectively. Adjusted net income from continuing operations for the fourth quarter of 2024 and the fourth quarter of 2023 was $4 million, and $27 million, respectively. Adjusted net income from continuing operations for the full year 2024 and 2023 was $86 million and $122 million, respectively. MRC Global's fourth quarter 2024 gross profit was $135 million, or 20.3% of sales, as compared to gross profit of $149 million, or 20.1% of sales, in the fourth quarter of 2023. Gross profit for the fourth quarter of 2024 and 2023 includes expense of $1 million and $5 million for the last-in, first out (LIFO) method of inventory cost accounting, respectively. Adjusted Gross Profit, as a percentage of sales, which excludes these items, as well as others, was 22.0% and 22.2% in the fourth quarter of 2024 and 2023, respectively. SG&A expenses were $123 million, or 18.5% of sales, for the fourth quarter of 2024 as compared to $121 million, or 16.4% of sales, for the same period of 2023. Adjusted SG&A expense for the fourth quarter of 2024 and 2023 was $119 million, or 17.9% of sales, and $120 million, or 16.2% of sales, respectively. For the three months ended December 31, 2024, income tax expense was $4 million with an effective rate of 133%, which was primarily impacted by foreign currency gains on debt restructuring and low pretax income for the quarter. For the three months ended December 31, 2023, income tax expense was $2 million with an effective rate of 8% which was favorably impacted by a net reduction in a foreign valuation allowance provision. Annual effective tax rates for 2024 and 2023 were 26% and 25%, respectively. Our rates generally differ from the U.S. federal statutory rate of 21% as a result of state income taxes, non-deductible expenses and differing foreign income tax rates. Adjusted EBITDA was $32 million in the fourth quarter of 2024 as compared to $49 million for the same period in 2023. Please refer to the reconciliation of non-GAAP measures (Adjusted EBITDA) to GAAP measures (net income (loss) from continuing operations) in this release. Sales The company's sales were $664 million for the fourth quarter of 2024, 10% lower than the fourth quarter of 2023 and a 14% decrease from the third quarter of 2024. As compared to the fourth quarter of 2023, the decrease was driven by the Downstream, Industrial and Energy Transition (DIET) sector followed by the Production & Transmission Infrastructure (PTI) sector. The sequential sales decline was across all sectors. Sales by Segment U.S. sales in the fourth quarter of 2024 were $542 million, a $91 million, or 14%, decrease from the same quarter in 2023. Gas Utilities sector sales were consistent with the prior year. DIET sector sales decreased by $48 million, or 25%, due to the conclusion of several projects and lower turnaround spending. PTI sector sales decreased $43 million, or 23%, due to lower customer activity and fewer projects. Sequentially, U.S. sales in the fourth quarter of 2024, as compared to the third quarter of 2024, were down $102 million, or 16%. The Gas Utilities sector experienced a $41 million, or 14%, decline primarily from typical seasonal buying patterns and deferred spending. PTI sector sales were down $34 million, or 19%, due to lower year-end customer activity and seasonality, and non-repeating projects. The DIET sector was down $27 million, or 16%, due to the conclusion of various projects and lower turnaround activity. International sales in the fourth quarter of 2024 were $122 million, up $15 million, or 14%, from the same period in 2023 as all sectors experienced growth. The PTI sector increase was driven primarily by multiple projects in Norway. The DIET sector increase was driven primarily by projects in the Middle East and Asia. Sequentially, International sales in the fourth quarter of 2024, as compared to the third quarter of 2024, were down $5 million, or 4%. The DIET sector decrease was due to lower turnaround activity and timing of project deliveries in Europe and the Nordics. The PTI sector decrease was driven by the timing of project deliveries in Australia, Asia and the U.K. Sales by Sector Gas Utilities sector sales, which are primarily U.S based, were $253 million in the fourth quarter of 2024, or 38% of total sales, unchanged from the fourth quarter of 2023. Sequentially, Gas Utilities sector sales in the fourth quarter of 2024, as compared to the third quarter of 2024, declined $40 million, or 14%. DIET sector sales in the fourth quarter of 2024 were $208 million, or 31% of total sales, a decrease of $46 million, or 18%, from the fourth quarter of 2023 driven by the U.S. segment. Sequentially, DIET sector sales in the fourth quarter of 2024, as compared to the prior quarter, decreased $31 million, or 13%, driven by the U.S. segment. PTI sector sales in the fourth quarter of 2024 were $203 million, or 31% of total sales, a decreased of $30 million, or 13%, from the fourth quarter of 2023 driven by the U.S. segment. Sequentially, PTI sector sales in the fourth quarter of 2024, as compared to the previous quarter, decreased $36 million, or 15%, driven by the U.S. segment. Balance Sheet and Cash Flow As of December 31, 2024, the company's cash balance was $63 million, long-term debt (including current portion) was $387 million, and Net Debt was $324 million. Cash provided by operations from continuing operations was $73 million in the fourth quarter of 2024 resulting in $268 million of cash provided by operations from continuing operations for the full year 2024. Availability under the company's ABL facility was $460 million, and liquidity was $523 million as of December 31, 2024. Please refer to the reconciliation of non-GAAP (Net Debt) to GAAP measures (long-term debt, net) in this release. Conference Call The company will hold a conference call to discuss its fourth quarter and full year 2024 results at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) on March 14, 2025. To participate in the call, please dial 201-689-8261 and ask for the MRC Global conference call. To access the conference call, live over the Internet, please log onto the web at and go to the 'Investors' page of the company's website. A replay will be available through March 28, 2025, and can be accessed by dialing 201-612-7415 and using passcode 13752336#. Also, an archive of the webcast will be available shortly after the call at for 90 days. About MRC Global Inc. Headquartered in Houston, Texas, MRC Global (NYSE: MRC) is the leading global distributor of pipe, valves, fittings (PVF) and other infrastructure products and services to diversified end-markets including the gas utilities, downstream, industrial and energy transition, and production and transmission infrastructure sectors. With over 100 years of experience, MRC Global has provided customers with innovative supply chain solutions, technical product expertise and a robust digital platform from a worldwide network of approximately 200 locations including valve and engineering centers. The company's unmatched quality assurance program offers approximately 200,000 SKUs from over 7,100 suppliers, simplifying the supply chain for over 8,300 customers. Find out more at 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' 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 SEC filings that may cause the company's actual results and performance to be materially different from any future results or performance expressed or implied by these forward-looking statements. These risks and uncertainties include (among others) decreases in capital and other expenditure levels in the industries that the company serves; U.S. and international general economic conditions; geopolitical events; decreases in oil and natural gas prices; unexpected supply shortages; loss of third-party transportation providers; cost increases by the company ' s suppliers and transportation providers; increases in steel prices, which the company may be unable to pass along to its customers which could significantly lower the company ' s profit; the company ' s lack of long-term contracts with most of its suppliers; suppliers ' price reductions of products that the company sells, which could cause the value of its inventory to decline; decreases in steel prices, which could significantly lower the company ' s profit; a decline in demand for certain of the products the company distributes if tariffs and duties on these products are imposed or lifted; holding more inventory than can be sold in a commercial time frame; significant substitution of renewables and low-carbon fuels for oil and gas, impacting demand for the company ' s products; risks related to adverse weather events or natural disasters; environmental, health and safety laws and regulations and the interpretation or implementation thereof; changes in the company ' s customer and product mix; the risk that manufacturers of the products that the company distributes will sell a substantial amount of goods directly to end users in the industry sectors that the company serves; failure to operate the company ' s business in an efficient or optimized manner; the company ' s ability to compete successfully with other companies; the company ' s lack of long-term contracts with many of its customers and the company ' s lack of contracts with customers that require minimum purchase volumes; inability to attract and retain employees or the potential loss of key personnel; adverse health events, such as a pandemic; interruption in the proper functioning of the company ' s information systems; the occurrence of cybersecurity incidents; risks related to the company ' s customers ' creditworthiness; the success of acquisition strategies; the potential adverse effects associated with integrating acquisitions and whether these acquisitions will yield their intended benefits; impairment of the company ' s goodwill or other intangible assets; adverse changes in political or economic conditions in the countries in which the company operates; the company ' s significant indebtedness; the dependence on the company ' s subsidiaries for cash to meet parent company obligations; changes in the company ' s credit profile; potential inability to obtain necessary capital; the potential share price volatility and costs incurred in response to any shareholder activism campaigns; the sufficiency of the company ' s insurance policies to cover losses, including liabilities arising from litigation; product liability claims against the company; pending or future asbestos-related claims against the company; exposure to U.S. and international laws and regulations, regulating corruption, limiting imports or exports or imposing economic sanctions; risks relating to ongoing evaluations of internal controls required by Section 404 of the Sarbanes-Oxley Act and a material weakness related to our inventory cycle count control if it remains unremediated; and risks related to changing laws and regulations including trade policies and tariffs. For a discussion of key risk factors, please see the risk factors disclosed in the company's SEC filings, which are available on the SEC's website at and on the company's website, MRC Global's filings and other important information are also available on the 'Investors' page of the company's website at 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. Contact: Monica Broughton VP, Investor Relations & Treasury MRC Global Inc. [email protected] 832-308-2847 MRC Global Inc. Condensed Consolidated Balance Sheets (Unaudited) (in millions) December 31, December 31, 2024 2023 Assets Current assets: Cash $ 63 $ 131 Accounts receivable, net 378 410 Inventories, net 415 511 Other current assets 29 34 Current assets of discontinued operations 36 69 Total current assets 921 1,155 Long-term assets: Operating lease assets 170 196 Property, plant and equipment, net 89 77 Other assets 37 21 Noncurrent assets of discontinued operations - 10 Intangible assets: Goodwill, net 264 264 Other intangible assets, net 143 163 Total assets $ 1,624 $ 1,886 Liabilities and stockholders' equity Current liabilities: Trade accounts payable $ 329 $ 340 Accrued expenses and other current liabilities 124 100 Operating lease liabilities 31 32 Current portion of debt obligations 3 292 Current liabilities of discontinued operations 21 19 Total current liabilities 508 783 Long-term obligations: Long-term debt 384 9 Operating lease liabilities 153 179 Deferred income taxes 35 45 Other liabilities 28 20 Noncurrent liabilities of discontinued operations - 7 Commitments and contingencies 6.5% Series A Convertible Perpetual Preferred Stock, $0.01 par value; authorized no and 363,000 shares, respectively; no and 363,000 shares issued and outstanding, respectively - 355 Stockholders' equity: Common stock, $0.01 par value per share: 500 million shares authorized, 109,460,293 and 108,531,564 issued, respectively 1 1 Additional paid-in capital 1,779 1,768 Retained deficit (652) (678) Treasury stock at cost: 24,216,330 shares (375) (375) Accumulated other comprehensive loss (237) (228) Total stockholders' equity 516 488 Total liabilities and stockholders' equity $ 1,624 $ 1,886 MRC Global Inc. Condensed Consolidated Statements of Operations (Unaudited) (in millions, except per share amounts) Three Months Ended Year Ended December 31, December 31, December 31, December 31, 2024 2023 2024 2023 Sales $ 664 $ 740 $ 3,011 $ 3,266 Cost of sales 529 591 2,391 2,596 Gross profit 135 149 620 670 Selling, general and administrative expenses 123 121 485 482 Operating income 12 28 135 188 Other (expense) income: Interest expense (7) (6) (26) (32) Other, net (2) 2 (4) (2) Income from continuing operations before income taxes 3 24 105 154 Income tax expense from continuing operations 4 2 27 39 Net (loss) income from continuing operations (1) 22 78 115 Loss from discontinued operations, net of tax (22) (1) (23) (1) Net (loss) income (23) 21 55 114 Series A preferred stock dividends 2 6 20 24 Loss on repurchase and retirement of preferred stock 9 - 9 - Net (loss) income attributable to common stockholders $ (34) $ 15 $ 26 $ 90 Basic (loss) earnings per common share: (Loss) income from continued operations $ (0.14) $ 0.19 $ 0.58 $ 1.08 Loss from discontinued operations (0.26) (0.01) (0.27) (0.01) Basic (loss) earnings per common share $ (0.40) $ 0.18 $ 0.31 $ 1.07 Diluted (loss) earnings per common share: (Loss) income from continued operations $ (0.14) $ 0.19 $ 0.57 $ 1.06 Loss from discontinued operations (0.26) (0.01) (0.27) (0.01) Diluted (loss) earnings per common share $ (0.40) $ 0.18 $ 0.30 $ 1.05 Weighted-average common shares, basic 85.2 84.3 85.1 84.2 Weighted-average common shares, diluted 85.2 85.9 86.6 85.5 MRC Global Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) (in millions) Year Ended December 31, December 31, 2024 2023 Operating activities Net income from continuing operations $ 78 $ 115 Adjustments to reconcile net income from continuing operations to net cash provided by continuing operations: Depreciation and amortization 21 19 Amortization of intangibles 19 21 Equity-based compensation expense 16 14 Deferred income tax benefit (8) (7) (Decrease) increase in LIFO reserve (2) 2 Foreign currency losses 5 3 Other non-cash items 7 3 Changes in operating assets and liabilities: Accounts receivable 25 57 Inventories 90 15 Other current assets - (3) Accounts payable (10) (47) Accrued expenses and other current liabilities 27 (15) Operating cash flows from continuing operations 268 177 Operating cash flows from discontinued operations 8 4 Net cash provided by operating activities 276 181 Investing activities Purchases of property, plant and equipment (28) (14) Proceeds from the disposition of property, plant and equipment - 1 Other investing activities 1 - Investing cash flows from continuing operations (27) (13) Investing cash flows from discontinued operations — (1) Net cash used in investing activities (27) (14) Financing activities Payments on revolving credit facilities (449) (882) Proceeds from revolving credit facilities 484 847 Payments on debt obligations (295) (3) Proceeds from term loan 348 - Debt issuance costs paid (7) (1) Repurchase of preferred stock (365) - Dividends paid on preferred stock (23) (24) Repurchases of shares to satisfy tax withholdings (5) (4) Other financing activities (2) - Financing cash flows from continuing operations (314) (67) Financing cash flows from discontinued operations — — Net cash used in financing activities (314) (67) (Decrease) increase in cash (65) 100 Effect of foreign exchange rate on cash (3) (1) Cash beginning of year 131 32 Cash end of year $ 63 $ 131 MRC Global Inc. Supplemental Sales Information (Unaudited) (in millions) Disaggregated Sales by Segment and Sector Three Months Ended December 31, U.S. International Total 2024 Gas Utilities $ 252 $ 1 $ 253 DIET 143 65 208 PTI 147 56 203 $ 542 $ 122 $ 664 2023 Gas Utilities $ 252 $ 1 $ 253 DIET 191 63 254 PTI 190 43 233 $ 633 $ 107 $ 740 Year Ended December 31, U.S. International Total 2024 Gas Utilities $ 1,097 $ 1 $ 1,098 DIET 703 267 970 PTI 730 213 943 $ 2,530 $ 481 $ 3,011 2023 Gas Utilities $ 1,190 $ 3 $ 1,193 DIET 790 250 1,040 PTI 865 168 1,033 $ 2,845 $ 421 $ 3,266 MRC Global Inc. Supplemental Information (Unaudited) Reconciliation of Gross Profit to Adjusted Gross Profit (a non-GAAP measure) (in millions) Three Months Ended December 31, Percentage December 31, Percentage 2024 of Revenue* 2023 of Revenue* Gross profit, as reported $ 135 20.3 % $ 149 20.1 % Depreciation and amortization 5 0.8 % 4 0.5 % Amortization of intangibles 4 0.6 % 6 0.8 % Increase in LIFO reserve 1 0.2 % 5 0.7 % Transaction costs 1 0.2 % - 0.0 % Adjusted Gross Profit $ 146 22.0 % $ 164 22.2 % Year Ended December 31, Percentage December 31, Percentage 2024 of Revenue* 2023 of Revenue Gross profit, as reported $ 620 20.6 % $ 670 20.5 % Depreciation and amortization 21 0.7 % 19 0.6 % Amortization of intangibles 19 0.6 % 21 0.6 % (Decrease) increase in LIFO reserve (2) (0.1)% 2 0.1 % Transaction costs 1 0.0 % - 0.0 % Adjusted Gross Profit $ 659 21.9 % $ 712 21.8 % Notes to above: * Does not foot due to rounding The company defines Adjusted Gross Profit as sales, less cost of sales, plus depreciation and amortization, plus amortization of intangibles, plus inventory-related charges incremental to normal operations, plus transaction costs associated with acquisitions and plus or minus the impact of its LIFO inventory costing methodology. The company presents Adjusted Gross Profit because the company believes it is a useful indicator of the company's operating performance without regard to items, such as amortization of intangibles, that can vary substantially from company to company depending upon the nature and extent of acquisitions of which they have been involved. Similarly, the impact of the LIFO inventory costing method can cause results to vary substantially from company to company depending upon whether they elect to utilize LIFO and depending upon which method they may elect. The company uses Adjusted Gross Profit as a key performance indicator in managing its business. The company believes that gross profit is the financial measure calculated and presented in accordance with U.S. Generally Accepted Accounting Principles that is most directly comparable to Adjusted Gross Profit. Notes to above: (1) Employee severance and restructuring charges (pre-tax) in both our U.S. and International segments. (2) Charge (pre-tax) associated with a facility closure in our International segment. (3) Charge (pre-tax) for a customer settlement in our U.S. segment. The company defines adjusted selling, general and administrative (SG&A) expenses as SG&A, less severance and restructuring expenses and other unusual items. The company presents adjusted SG&A because the company believes it is a useful indicator of the company's operating performance. Among other things, adjusted SG&A measures the company's operating performance without regard to certain non-recurring, non-cash or transaction-related expenses. The company uses adjusted SG&A as a key performance indicator in managing its business. The company believes that SG&A is the financial measure calculated and presented in accordance with U.S. Generally Accepted Accounting Principles that is most directly comparable to adjusted SG&A. Notes to above: (1) Charge (pre-tax) associated with a facility closure in our International segment. (2) Employee severance and restructuring charges (pre-tax) in both our U.S. and International segments. (3) Charges (pre-tax) recorded in SG&A. (4) Charge (pre-tax) for a customer settlement in our U.S. segment. (5) Charge (pre-tax) for an asset disposal in our International segment. The company defines adjusted EBITDA as net income (loss) plus the loss from discontinued operations, net of tax, plus interest, income taxes, depreciation and amortization, amortization of intangibles, and certain other expenses, including non-cash expenses, (such as equity-based compensation, severance and restructuring, changes in the fair value of derivative instruments and asset impairments, including inventory) and plus or minus the impact of its LIFO inventory costing methodology. 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 (loss), 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. See the company's Annual Report filed on Form 10-K for a more thorough discussion of the use of adjusted EBITDA. Notes to above: (1) An after-tax charge associated with a facility closure in our International segment. (2) An after-tax charge for severance and restructuring charges in both our U.S. and International segments. (3) An after-tax charge for an asset disposal in our International segment. (4) An after-tax charge for a customer settlement in our U.S. segment. The company defines adjusted net income from continuing operations (a non-GAAP measure) as net (loss) income plus the loss from discontinued operations, net of tax, plus or minus the after-tax impact of items deemed non-standard and plus or minus the after-tax impact of its LIFO inventory costing methodology. The impact of the LIFO inventory costing methodology can cause results to vary substantially from company to company depending upon whether they elect to utilize LIFO and depending upon which method they may elect. After-tax impacts were determined using the company's U.S. blended statutory rate. The company presents adjusted net income from continuing operations because the company believes it provides useful comparisons of the company's operating results to other companies, including those companies with whom we compete in the distribution of pipe, valves and fittings to the energy industry, without regard to the irregular variations from certain restructuring events not indicative of the on-going business. The company believes that net (loss) income is the financial measure calculated and presented in accordance with U.S. Generally Accepted Accounting Principles that is most directly compared to adjusted net income from continuing operations. MRC Global Inc. Supplemental Information (Unaudited) Reconciliation of Net (Loss) Income Attributable to Common Stockholders to Adjusted Net (Loss) Income Attributable to Common Stockholders (a non-GAAP measure) (in millions, except per share amounts) December 31, 2024 Three Months Ended Year Ended Amount Per Share* Amount Per Share* Net (loss) income attributable to common stockholders $ (34) $ (0.40) $ 26 $ 0.30 Loss from discontinued operations, net of tax 22 0.26 23 0.27 Transaction costs, net of tax 1 0.01 1 0.01 Facility closures, net of tax (1) - - 1 0.01 Severance and restructuring, net of tax (2) 2 0.02 2 0.02 Non-recurring IT related professional fees, net of tax 1 0.01 1 0.01 Asset disposal, net of tax (3) - - 1 0.01 Non-recurring other legal and consulting costs, net of tax 1 0.01 1 0.01 Activism response legal and consulting costs, net of tax - - 3 0.03 Decrease in LIFO reserve, net of tax - - (2) (0.02) Adjusted Net (Loss) Income Attributable to Common Stockholders $ (7) $ (0.08) $ 57 $ 0.66 December 31, 2023 Three Months Ended Year Ended Amount Per Share* Amount Per Share* Net income attributable to common stockholders $ 15 $ 0.18 $ 90 $ 1.05 Loss from discontinued operations, net of tax 1 0.01 1 0.01 Non-recurring IT related professional fees, net of tax - - 1 0.01 Asset disposal, net of tax (3) - - 1 0.01 Customer settlement, net of tax (4) - - 2 0.02 Activism response legal and consulting costs, net of tax 1 0.01 1 0.01 Increase in LIFO reserve, net of tax 4 0.05 2 0.02 Adjusted Net Income Attributable to Common Stockholders $ 21 $ 0.24 $ 98 $ 1.15 Notes to above: *Does not foot due to rounding (1) An after-tax charge associated with a facility closure in our International segment. (2) An after-tax charge for severance and restructuring charges in both our U.S. and International segments. (3) An after-tax charge for an asset disposal in our International segment. (4) An after-tax charge for a customer settlement in our U.S. segment. The company defines adjusted net income (loss) attributable to common stockholders (a non-GAAP measure) as net income (loss) attributable to common stockholders plus the loss from discontinued operations, net of tax, plus or minus the after-tax impact of items deemed non-standard and plus or minus the after-tax impact of its LIFO inventory costing methodology. The impact of the LIFO inventory costing methodology can cause results to vary substantially from company to company depending upon whether they elect to utilize LIFO and depending upon which method they may elect. After-tax impacts were determined using the company's U.S. blended statutory rate. The company presents adjusted net income (loss) attributable to common stockholders and related per share amounts because the company believes it provides useful comparisons of the company's operating results to other companies, including those companies with whom we compete in the distribution of pipe, valves and fittings to the energy industry, without regard to the irregular variations from certain restructuring events not indicative of the on-going business. The company believes that net income (loss) attributable to common stockholders is the financial measure calculated and presented in accordance with U.S. Generally Accepted Accounting Principles that is most directly compared to adjusted net income (loss) attributable to common stockholders. MRC Global Inc. Supplemental Information (Unaudited) Reconciliation of Long-term Debt to Net Debt (a non-GAAP measure) and the Net Debt Leverage Ratio Calculation (in millions) December 31, 2024 Long-term debt $ 384 Plus: current portion of debt obligations 3 Total debt 387 Less: cash 63 Net Debt $ 324 Net Debt $ 324 Trailing twelve months adjusted EBITDA 202 Net debt leverage ratio 1.6 x Net Debt and related leverage metrics may be considered non-GAAP measures. The company defines Net Debt as long-term debt, including current portion, minus cash. The company defines net debt leverage ratio as Net Debt divided by trailing twelve months adjusted EBITDA. The company believes Net Debt is an indicator of the extent to which the company's outstanding debt obligations could be satisfied by cash on hand and a useful metric for investors to evaluate the company's leverage position. The company believes the net debt leverage ratio is a commonly used metric that management and investors use to assess the borrowing capacity of the company. The company believes total long-term debt (including the current portion) is the financial measure calculated and presented in accordance with U.S. Generally Accepted Accounting Principles that is most directly comparable to Net Debt.
