The following is a summary of the MRC Global Inc. (MRC) Q3 2024 Earnings Call Transcript:
Financial Performance:
MRC Global reported Q3 revenue of $797 million, a 4% decline from Q2, and a 10% decrease year-over-year.
Adjusted EBITDA was at 6% for Q3, lower due to lower sales and adjusted gross margins.
Operating cash flow for Q3 was strong at $96 million, contributing to a total of $197 million through Q3.They achieved a pro forma leverage ratio of approximately 1.7x based on trailing 12-month adjusted EBITDA.
Business Progress:
MRC Global has improved its capital structure by replacing convertible preferred shares with a new term loan, expecting to further reduce debt in 2025.
Significant progress in international markets with Q3 revenue growing 21% year-over-year, supported by a 22% higher backlog.
The company anticipates improvements in the gas utilities and DIET sectors for 2025, supported by increasing customer capital expenditures.
Opportunities:
MRC Global expects an increase in gas utilities spending in 2025, capitalizing on increased capital expenditures announcements from several major customers.
The international segment is projected to continue solid growth in 2025, particularly in energy transition projects and refinery work.
Risks:
Concerns over global oil supply and demand imbalances and excess natural gas production pose risks to North American oilfield production activity, impacting the PTI sector.
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