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Jun 30, 2020
MRC Global Q2 2020 Earnings Report
Reported a challenging quarter due to the coronavirus pandemic, with sales declining and significant restructuring and impairment charges impacting net income.
Key Takeaways
MRC Global reported sales of $602 million, a 24% sequential decline, and a net loss attributable to common shareholders of $(287) million. Results included restructuring and impairment charges of $284 million, net of tax. The company is focused on cost savings and debt reduction, generating $47 million in cash from operations during the quarter.
Sales were $602 million, a 24% sequential decrease and a 39% decrease compared to Q2 2019.
Net loss attributable to common stockholders was $287 million, or $(3.50) per diluted share, including $284 million in after-tax charges.
Adjusted net loss attributable to common stockholders was $(8) million, or $(0.10) per diluted share.
Cash flow from operations was $47 million, and net debt was reduced by $38 million to $455 million.
MRC Global
MRC Global
MRC Global Revenue by Segment
Revenue by Segment
U.S. Sales Revenue
CapyFin.comInternational Sales Revenue
CapyFin.com Forward Guidance
MRC Global is targeting $200 million in cash from operations for the full year and expects cost savings programs to achieve over $100 million of adjusted cost savings in 2020 as compared to 2019.
Positive Outlook
- Targeting $200 million cash from operations for the full year.
- Expecting to achieve over $100 million of adjusted cost savings in 2020 compared to 2019.
- Transitioning smaller transactional customers to e-commerce platform to reduce cost to serve.
- Targeting $5 million to $10 million in annual savings by 2022 from e-commerce platform transition.
- Committed to long-term strategy to enhance shareholder value.
Challenges Ahead
- Significant volatility and uncertainty in the oil and gas industry due to COVID-19.
- Oil demand has significantly deteriorated, resulting in lower customer spending.
- Reduced demand for the company’s products and services.
- Significant uncertainty as to the duration of this disruption.
- Order fulfillment risk could increase if shutdowns are re-established in suppliers’ locations.
Revenue & Expenses
Visualization of income flow from segment revenue to net income