Target Hospitality Corp. · NASDAQ:TH
Target Hospitality — Q3 2019 Earnings Presentation
19 slides from Target Hospitality's earnings presentation, Nov 13, 2019
Slide 1: 3Q 2019 Earnings Call Presentation
3Q 2019 Earnings Call Presentation November 13, 2019
Slide 2: Disclaimer
Disclaimer Cautionary Statement Regarding Forward-Looking Statements This presentation contains statements reflecting assumptions, expectations, projections, intentions or beliefs about future events that are intended as “forward-looking statements.” You can identify these statements by the fact tha
Slide 3: 3Q 2019 Operational and Financial Results
3Q 2019 Operational and Financial Results Brad Archer, President and Chief Executive Officer Eric Kalamaras, EVP and Chief Financial Officer
Slide 4: 3Q 2019 Highlights
3Q 2019 Highlights Solid operational Strong financial Disciplined growth Shareholder returns performance performance execution initiated Over 13,000 total beds with Adjusted EBITDA margin 2 new communities became $75.0 million stock repurchase greater than 10,000 utilized beds remained stron
Slide 5: Target Hospitality (NASDAQ: TH)
Target Hospitality (NASDAQ: TH) Nation’s largest vertically-integrated specialty rental and value-added hospitality services provider Largest provider of turnkey specialty rental units Key differentiating attributes Target Hospitality is the largest vertically integrated specialty rental and hospi
Slide 6: Differentiated, value-added business model
Differentiated, value-added business model 1 2 3 … premier customers through … premium in-house catering + Largest(1) network serving … exclusive LT relationships with … value-added hospitality services TARGET 12 WHAT WE PROVIDE ENHANCES THEIR YOUR WORKERS PERFORMANCE OFF THE CLOCK ON THE CLOCK 01 F
Slide 7: 3Q 2019 Financial highlights
3Q 2019 Financial highlights $81.6 million Total Revenue +35.3% year over year as reported(1); +5.6% year over year combined pro forma(1) $40.6 million | 49.7% Adjusted EBITDA margin(2) Adjusted EBITDA(2) +30.0% year over year as reported; +1.8% year over year combined pro forma $25.5 million
Slide 8: 3Q results reflect strong operational execution
3Q results reflect strong operational execution (US$, in millions) $2.2 $1.3 $1.5 $0.1 $8.7 $39.9 $40.6 $4.3 $31.2 A B C D E F 3Q 2018 Signor 3Q 2018 ADR Utilization COGS SG&A Other 3Q 2019 Adjusted EBITDA Contribution Adjusted EBITDA Adjusted EBITDA "as reported" "combined pro forma" "as reported"
Slide 9: 3Q 2019 Segment results
3Q 2019 Segment results(1) Permian Basin Bakken Basin Government US$, in ‘000s, except ADR US$, in ‘000s, except ADR US$, in ‘000s, except ADR y-o-y change: +64.9% +62.9% y-o-y change: -18.7% -13.4% y-o-y change: ~0% +7.0% $56,524 $33,285 $7,400 $3,343 $16,864 $16,830 $12,817 $11,977 $2,895 $6,019 $
Slide 10: Robust cash generation backed by nominal maintenance capex needs
Robust cash generation backed by nominal maintenance capex needs 3Q-YTD Adjusted EBITDA & Adjusted FCF(1) conversion 3Q-YTD capital expenditures(3) Adj. FCF conversion(2): 71% 91% Avg. available beds: 8,595 12,485 US$ in millions US$ in millions $123.1 $74.2 $62.0 $72.9 $111.6 = 91% $52.0 of Adjuste
Slide 11: 3Q 2019 Cash flow drivers
3Q 2019 Cash flow drivers (US$, in millions) 3Q 2019 cash flow walk $25.5 $0.4 Items of note: $4.2 $25.5 million of net cash flow from operations – Includes $17.1 million cash interest paid – $42.6 million net cash flow from operations excluding cash interest paid – Minimal cash impact from workin
Slide 12: 2019 Financial Outlook
2019 Financial Outlook Full Year Total Revenue $318 to $328 million Adjusted EBITDA $157 to $162 million Assumptions: SG&A, ex. charges and credits $32 to $34 million Net capital expenditures $80 to $90 million 3Q 2019 Earnings Call Presentation | 12
Slide 13: Summary
Summary 3Q Highlights ► Solid operational and financial performance ► Significant net cash flow from operations – $25.5 million, includes $17.1 million cash paid for interest ► Commenced stock repurchases under $75.0 million initial repurchase authorization ► Excellent execution – on-time opening of
Slide 14: Appendix
Appendix 5-) TARGET HOSPITALITY
Slide 15: Share count analysis
Share count analysis Total Potential Outstanding Shares by Type Common Stock Other Shares and Equivalents Outstanding (4) Common Shares (Fully Diluted) Outstanding as of Escrowed All unvested stock options and Exercise of 9/30/2019 (1) Founder Shares (2) restricted stock units Outstanding Warrants (
Slide 16: Non-GAAP Reconciliations
Non-GAAP Reconciliations Target Hospitality Corp. Target Hospitality Corp. Reconciliation of Net income to Adjusted net income and Adjusted diluted earnings per share Reconciliation of Gross profit to Adjusted gross profit and Adjusted gross profit margin ($ in thousands, except per share amounts) (
Slide 17: Non-GAAP Reconciliations, continued
Non-GAAP Reconciliations, continued Target Hospitality Corp. Target Hospitality Corp. Reconciliation of Net income (loss) to EBITDA, Adjusted EBITDA, and Adjusted EBITDA margin Reconciliation of Adjusted EBITDA to Net cash (used in) provided by operating activities to Adjusted free cash ($ in thousa
Slide 18: Non-GAAP Reconciliations, continued
Non-GAAP Reconciliations, continued Target Hospitality Corp. Reconciliation of Net income (loss) to EBITDA, Adjusted EBITDA, and Adjusted EBITDA margin ($ in thousands) Combined Pro forma As Reported Combined Pro forma Year Ended Quarter Ended Year Ended Quarter Ended Nine Months Ended Last Tweleve
Slide 19: 5;) TARGET
5;) TARGET HOSPITALITY