Team (TISI) Q2 2025 Earnings Call Transcript

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Wednesday, Aug. 13, 2025 astatine 11 a.m. ET

• President & Chief Executive Officer — Keith D. Tucker

• Executive Vice President & Chief Financial Officer — Nelson M. Haight

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Keith D. Tucker: Thank you, Nelson. Welcome, everyone, and convey you for joining america to reappraisal our 2nd 4th operational and fiscal highlights. We delivered beardown results successful the 2nd 4th arsenic we saw important maturation successful revenue, gross borderline and adjusted EBITDA. Revenue grew 8.5% oregon astir $20 cardinal year-over-year, with gross borderline expanding by 7.1% and adjusted EBITDA up by 12.4%. As you tin see, the maturation successful our adjusted EBITDA outpaced our apical enactment maturation which is simply a testament to the coagulated advancement we proceed to marque successful our ongoing outgo and borderline betterment program.

Drilling down into the segments, we saw 15% wide gross maturation successful Inspection and Heat Treating, driven by an summation of implicit 13% successful the U.S. We besides saw our Canada operations present year-over-year gross maturation of 31%, demonstrating the mounting traction of our ongoing initiatives to fortify commercialized and fiscal show of this business. This performance, unneurotic with a astir 26% year-over-year gross summation successful our higher-margin vigor trading gross helped to thrust 25% maturation successful IHT conception adjusted EBITDA and a 118 ground constituent betterment successful our IHT conception adjusted EBITDA margin.

In our Mechanical Services segment, our U.S. operations led the mode with a year-over-year summation successful gross up 7%, offsetting short-term gross weakness successful our planetary concern and helping to thrust the 2% maturation we saw successful full MS revenue. Our adjusted EBITDA for the 2nd 4th accrued by 12.4% year-over-year to $24.5 million, with adjusted EBITDA borderline up 40 ground points to 9.9% of our consolidated revenue. We proceed to spot benefits from our outgo subject successful the 2nd quarter, lowering our adjusted selling, wide and administrative disbursal which excludes expenses not typical of Team's ongoing operations specified arsenic nonrecurring fees and noncash expenses to 18.9% of consolidated gross versus 19.8% successful the 2nd 4th of 2024.

We stay focused connected driving gross growth, strict outgo subject and improving operational execution. In the 2nd 4th of 2025, we completed a bid of actions targeting further betterment successful our SG&A and different costs that are expected to output annualized outgo savings of astir $10 million. We expect to spot astir $6 cardinal of those savings travel done successful the 2nd fractional of 2025. In the 2nd quarter, we besides began to spot immoderate results from our targeted actions to amended the fiscal and commercialized show of our Canadian operations, peculiarly successful the apical line, and we expect to spot continued year-over- twelvemonth betterment successful the 2nd fractional of 2025.