Team (TISI) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue was $228.6 million, down 4.5% year-over-year, but net loss improved to $2.8 million from $15.8 million in Q2 2023, driven by cost reductions and margin expansion.

• Adjusted EBITDA rose 25% to $21.8 million (9.5% of revenue), reflecting improved operating leverage and lower overhead.

• Operating income increased to $11.2 million from $4.6 million, with significant progress in cost reduction and margin improvement.

• Leadership remains focused on operational execution, commercial initiatives, and strengthening the balance sheet.

• The company continues to address NYSE listing compliance and ongoing litigation.

Financial highlights

• Gross margin dollars increased to $63.6 million (27.8% of revenue), up 240 basis points year-over-year.

• Adjusted EBITDA for Q2 2024 was $21.8 million, up from $17.4 million in Q2 2023.

• Net loss for the quarter was $2.8 million ($0.63/share), a $13 million improvement over the prior year.

• Cash and cash equivalents at June 30, 2024 were $22.5 million, with total debt and finance obligations of $320.1 million.

• Free cash flow for the six months ended June 30, 2024 was negative $10.2 million.

Outlook and guidance

• Full-year 2024 Adjusted EBITDA guidance is $58–68 million, a 48% increase at the midpoint over 2023.

• Reaffirmed 2024 revenue guidance of $850–$900 million and gross margin guidance of $235–$265 million.

• Expecting top-line growth and further margin improvement in the second half of 2024, with strong activity in both core and international segments.

• Management believes current working capital, forecasted cash flows, and available credit are sufficient to fund operations and service debt.

• Clear path to achieving 10%+ Adjusted EBITDA margin in the near future.