MRC Global Inc.
) reported disappointing fourth-quarter 2013 results. Adjusted
earnings per share in the quarter came in at 32 cents, missing
the Zacks Consensus Estimate of 42 cents by 23.8%. The adjusted
earnings for the quarter also lagged the year-ago earnings of 55
cents due primarily to reduced margins.
On a GAAP basis, earnings per share for the quarter were 23
cents, which compared favorably with a loss of 6 cents in the
In 2013, adjusted earnings per share came in at $1.60, down
from $2.02 in 2012. Reported earnings also missed the Zacks
Consensus Estimate of $1.70 per share.
MRC Global reported 2.9% year-over-year increase in revenues
to $1,344.2 million, beating the Zacks Consensus Estimate of
$1,310.0 million. The increase in revenues was primarily due to
the contribution from acquisitions including Production Specialty
Services Inc., Flow Control Products and Flangefitt Stainless
Geographically, MRC Global reported 6% year-over-year increase
in revenues in the
to $1.01 billion. Revenues received a boost from the acquisition
of Production Specialty and Flow Control Products. Also, sales in
the gas utility and line pipe product lines increased.
, revenues generated were $189.3 million, down 10.6% from the
year-ago quarter due to declining project sales and a weak
Canadian dollar. Additionally, growth in Europe and Asia
sales by 1.8% year over year to $143.1 million. However, revenues
were pulled down slightly by a decline in the Australasia region
On a sector basis, upstream sales increased 5.5% year over
year to $606.0 million. Midstream sales increased 7.2% year over
year to $392.2 million. Downstream sales in the quarter were
$346.0 million, down 5.6% year over year.
In 2013, the company recorded revenues of $5.2 billion, down
from $5.6 billion in 2012. Revenues were in line with the Zacks
Cost of sales in the fourth quarter went up 6.7% year over
year to $1,118.2 million and represented 83.2% of the total
revenue, up from 80.2% in the year-ago quarter. Selling, general
and administrative expenses, as a percentage of total revenue,
came in at 12.4%. Adjusted earnings before interest, taxes,
depreciation and amortization (EBITDA) totaled $87.2 million,
down from $99.2 million in the fourth quarter of 2012.
Exiting 2013, cash balance of MRC Global stood at $25.2
million, down from $33.4 million in the previous quarter.
Long-term debt, net of current portion, declined sequentially to
$978.9 million from $1,037.3 million.
For 2013, MRC Global generated cash from operations of $323.6
million versus $240.1 million in the prior year. Capital
expenditure incurred in 2013 totaled $22.1 million, versus $26.2
million in the year-ago period.
For 2014, management anticipates revenues to range within
$5.5-$5.8 billion. Adjusted EBITDA is predicted within $400-$450
million, while capital expenditure is expected in the band of
$25.0 to $30.0 million. Also, MRC Global is expected to generate
cash flow from operations in $175.0 to $200.0 million range.
MRC Global is a leading global distributor of pipe, valves and
fittings, and related products and services to the energy and
industrial sectors. The company currently carries a Zacks Rank #4
(Sell). Other stocks in the industry worth considering include
The Middleby Corp.
Altra Industrial Motion Corp.
). All these carry a Zacks Rank #2 (Buy).
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MRC GLOBAL INC (MRC): Free Stock Analysis
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