NPK Reports Fourth Quarter and Full Year 2024 Results

THE WOODLANDS, Texas--(BUSINESS WIRE)--February 26, 2025-- 

NPK International Inc. (NYSE: NPKI) ("NPK" or the "Company") today announced results for the three and twelve months ended December 31, 2024.

FOURTH QUARTER 2024 RESULTS

(all comparisons versus the prior year period unless otherwise noted)

   -- 
 Revenues of $57.5 million, +24% 
 
 
   -- 
 Operating income from continuing operations of $11.6 million 
 
 
   -- 
 Operating margin from continuing operations of 20.2% 
 
 
   -- 
 Income from continuing operations of $8.0 million, or $0.09 per diluted 
      share; Adjusted Income from Continuing Operations of $7.1 million, or 
      $0.08 per diluted share 
 
 
   -- 
 Adjusted EBITDA from Continuing Operations of $17.1 million, +35% 
 
 
   -- 
 Adjusted EBITDA margin from Continuing Operations of 29.7% 
 
 
   -- 
 Total cash of $18 million and total debt of $8 million as of December 
      31, 2024 
 

FULL YEAR 2024 RESULTS

(all comparisons versus the prior year period unless otherwise noted)

   -- 
 Revenues of $217.5 million, +5% 
 
 
   -- 
 Operating income from continuing operations of $32.4 million 
 
 
   -- 
 Operating margin from continuing operations of 14.9% 
 
 
   -- 
 Income from continuing operations of $35.6 million, or $0.41 per 
      diluted share; Adjusted Income from Continuing Operations of $20.3 
      million, or $0.23 per diluted share 
 
 
   -- 
 Adjusted EBITDA from Continuing Operations of $54.9 million, +12% 
 
 
   -- 
 Adjusted EBITDA margin from Continuing Operations of 25.2% 
 
 
 
                                       Fourth Quarter 
----------------------------------  --------------------  -----  --- 
(In millions)                        2024       2023        Change 
----------------------------------   ----       ----      ---------- 
Revenues                            $57.5      $46.5      $11.0 
Operating income from continuing 
 operations                         $11.6      $ 6.1      $ 5.5 
Adjusted EBITDA from continuing 
 operations                         $17.1      $12.7      $ 4.4 
Operating margin from continuing 
 operations (%)                      20.2%      13.1%       710  bps 
Adjusted EBITDA margin from 
 continuing operations (%)           29.7%      27.3%       240  bps 
 
 
                                         Full Year 
---------------------------------  ----------------------  ----  --- 
(In millions)                       2024        2023        Change 
---------------------------------   -----       -----      --------- 
Revenues                           $217.5      $207.6      $9.9 
Operating income from continuing 
 operations                        $ 32.4      $ 22.9      $9.5 
Adjusted EBITDA from continuing 
 operations                        $ 54.9      $ 48.9      $6.0 
Operating margin from continuing 
 operations (%)                      14.9%       11.0%      390  bps 
Adjusted EBITDA margin from 
 continuing operations (%)           25.2%       23.6%      160  bps 
 
 

MANAGEMENT COMMENTARY

"We delivered a strong finish to a historic year for NPK," stated Matthew Lanigan, President and CEO of NPK International. "Through our third quarter 2024 divestiture, we streamlined our business model to focus exclusively on site-access and specialty rental solutions. We have also sharpened our commercial strategy and completed the expansion of our commercial sales team, to accelerate the penetration of higher-value growth opportunities. This transformative shift positions us to further optimize our return on invested capital through continued investments in organic expansion, targeted investments in inorganic growth and our $50 million share repurchase authorization.

"Our nationwide sales coverage model and targeted focus on key growth accounts has positioned us to prioritize higher-growth, higher-value opportunities, consistent with our strategic focus. Our team demonstrated strong execution on our commercial growth and operational excellence initiatives throughout the year, a performance that culminated in 12% year-over-year organic growth in Adjusted EBITDA," continued Lanigan. "Revenue growth and continued cost discipline contributed to improved operating leverage, resulting in 160 bps of Adjusted EBITDA margin expansion, when compared to the prior year.

"We delivered an outstanding fourth quarter performance," continued Lanigan. "Fourth quarter revenue and Adjusted EBITDA increased by 24% and 35%, respectively, as rental revenue reached a new single-quarter record. Gross margin increased by nearly 500 bps to a two-year high, supported by a more favorable sales mix, while Adjusted EBITDA margin increased by 240 bps to 29.7%, when compared to the prior year.

"During the fourth quarter, we launched our new brand identity, NPK International, a leading worksite access solutions company committed to providing best-in-class products and services to support our customers critical infrastructure projects," continued Lanigan. "We continue to make progress with our industry reclassification process and currently expect our new industry classification to be finalized before our first quarter 2025 results conference call.

"Today, we are introducing financial guidance for the full-year 2025," continued Lanigan. "We remain constructive on the long-term outlook for utility and critical infrastructure spending, together with our proven ability to deliver profitable growth through the cycle. To that end, at the midpoint of our 2025 financial guidance, we anticipate revenue and Adjusted EBITDA growth of 10% and 18%, respectively, when compared to the full-year 2024. Our guidance also assumes 2025 net capital expenditures of between $35 million to $40 million, approximately 80% of which is expected to be allocated toward the continued expansion of our rental fleet.

"Entering 2025, NPK is uniquely positioned to capitalize on both favorable demand conditions within our utilities transmission and critical infrastructure markets, along with increased adoption of our next-generation composite matting technology," continued Lanigan. "We remain focused on accelerating our pace of organic growth through geographic expansion, market share gains, and capabilities expansion within our worksite access markets, while continuing to drive efficiency improvements and cost optimization across the organization, consistent with our long-term focus on sustained value creation."

BUSINESS UPDATE

NPK is engaged in a multi-year business transformation plan designed to drive organic commercial growth within targeted, higher-margin product and rental markets; improve asset optimization and organizational efficiency; and pursue a capital allocation strategy that prioritizes investments in opportunities with superior return profiles, together with a programmatic return of capital program.

Fourth quarter 2024 highlights include:

   -- 
 Strong customer demand for matting rental and related services. 
      Revenues from specialty rental and related services increased to a record 
      $42 million in the fourth quarter, driven by elevated demand from key 
      customer accounts in support of scheduled transmission projects. Revenues 
      from product sales also increased to $16 million for the fourth quarter 
      of 2024, reflecting typical quarterly fluctuations in order and delivery 
      timing. 
 
 
   -- 
 Improved operating efficiency. NPK remains focused on efficiency 
      improvements and operating cost optimization across every aspect of its 
      business. The Company continues to evaluate and execute actions intended 
      to streamline the organization and its cost structure, while targeting 
      SG&A as percentage of revenue in the mid-teens percent range by early 
      2026. In the fourth quarter of 2024, NPK's SG&A as percentage of revenue 
      was 18.6%, a decline of nearly 350 bps versus the prior year period. 
 
 
   -- 
 Robust return of capital program. In February 2024, the Board of 
      Directors increased the authorization for repurchases of common stock up 
      to $50.0 million. No share repurchases were made in 2024 due to trading 
      blackout restrictions associated with the Fluids Systems sale process 
      that was completed in September 2024, along with other events. 
 
 
   -- 
 New brand identity. During the fourth quarter of 2024, the Company 
      announced a name change from Newpark Resources (NYSE: NR) to NPK 
      International (NYSE: NPKI). On December 19, 2024, the Company's common 
      stock began trading on the NYSE under the ticker symbol 'NPKI'. 
 

FINANCIAL PERFORMANCE

In the fourth quarter of 2024, NPK generated income from continuing operations of $8.0 million, or $0.09 per diluted share, on total revenue of $57.5 million, compared to income from continuing operations of $5.2 million, or $0.06 per diluted share, on total revenue of $46.5 million, in the prior year period. Income from continuing operations for the fourth quarter of 2024 includes an income tax benefit of $1.3 million primarily reflecting the release of valuation allowances on U.S. state net operating losses following the sale of the Fluids Systems business. Gross margin was 39.2% in the fourth quarter 2024, compared to 34.2% in the fourth quarter of 2023. The Company reported Adjusted EBITDA from Continuing Operations of $17.1 million in the fourth quarter of 2024, or 29.7% of total revenue, compared to $12.7 million, or 27.3% of total revenue, in the fourth quarter of 2023.

Selling, general and administrative expenses were $10.7 million (18.6% of revenues) in the fourth quarter of 2024, compared to $10.2 million (22.1% of revenues) in the prior year period. For the full year 2024, selling, general and administrative expenses were $46.0 million (21.2% of revenues), compared to $51.1 million (24.6%) in the prior year.

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