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Jun 30, 2023
Mistras Q2 2023 Earnings Report
Mistras Group reported a slight decrease in revenue but highlighted growth in key markets and cost-saving initiatives.
Key Takeaways
Mistras Group's Q2 2023 revenue was $176.0 million, a 1.7% decrease year-over-year. Despite the revenue decline, the company saw strong growth in Commercial Aerospace and Data Solutions. Net income was $0.3 million, and Adjusted EBITDA was $15.3 million. The company is implementing cost-saving initiatives expected to yield $6.2 million in annualized savings.
Revenue decreased by 1.7% to $176.0 million due to delayed Defense contract and decreases in Power Generation, offset by growth in Commercial Aerospace and Data Solutions.
Gross profit was $49.7 million, with a gross profit margin of 28.2%.
Net income was $0.3 million, and Adjusted EBITDA was $15.3 million.
Cost-saving initiatives are expected to yield approximately $6.2 million in annualized savings.
Revenue by Segment
Forward Guidance
The Company is updating its guidance ranges, to reflect current market conditions and the Company’s focus on profitable growth and cost savings. Revenue for the full year 2023 is now expected to be between $700 and $720 million, due primarily to reductions in legacy Oil and Gas revenue particularly the Downstream sub-category. Adjusted EBITDA is now expected to be between $68 and $71 million.
Positive Outlook
- Focus on profitable growth
- Cost savings initiatives
- Revenue expected between $700 and $720 million
- Adjusted EBITDA expected between $68 and $71 million
Challenges Ahead
- Reductions in legacy Oil and Gas revenue
- Operating cash flow will be adversely impacted by certain cash expenses to achieve cost savings
- Free Cash Flow guidance is being adjusted to between $23 and $25 million due to the reduction in the Company’s Adjusted EBITDA guidance and higher than anticipated Capital Expenditures of over $20 million.
- Downstream sub-category revenue reduction
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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