Oceaneering Reports Third Quarter 2023 Results

HOUSTON--(BUSINESS WIRE)--Oceaneering International, Inc. ("Oceaneering") (NYSE:OII) today reported net income of $29.8 million, or $0.29 per share, on revenue of $635 million for the three months ended September 30, 2023. Adjusted net income was $38.5 million, or $0.38 per share, reflecting the impact of $(0.9) million of pre-tax adjustments associated with foreign exchange gains recognized during the quarter, $0.6 million tax effect on adjustments associated with foreign exchange gains and $9.0 million of discrete tax adjustments, primarily due to changes in valuation allowances, uncertain tax positions and prior year estimates.

During the prior quarter ended June 30, 2023, Oceaneering reported net income of $19.0 million, or $0.19 per share, on revenue of $598 million. Adjusted net income was $18.7 million, or $0.18 per share, reflecting the impact of $4.8 million of pre-tax adjustments associated with foreign exchange losses recognized during the quarter, $(2.3) million tax effect on adjustments associated with foreign exchange losses and $(2.8) million of discrete tax adjustments, primarily due to changes in valuation allowances and uncertain tax positions.

Adjusted net income (loss) and earnings (loss) per share; EBITDA and adjusted EBITDA (as well as EBITDA and adjusted EBITDA margins); and free cash flow are non-GAAP measures that exclude the impacts of certain identified items. Reconciliations to the corresponding GAAP measures are shown in the tables Adjusted Net Income (Loss) and Diluted Earnings (Loss) per Share (EPS), EBITDA and Adjusted EBITDA and Margins, Free Cash Flow, 2023 and 2024 Adjusted EBITDA and 2023 Free Cash Flow Estimates, and EBITDA and Adjusted EBITDA and Margins by Segment. These tables are included below under the caption Reconciliations of Non-GAAP to GAAP Financial Information.

Summary of Results
(in thousands, except per share amounts)
	For the Three Months Ended						For the Nine Months Ended
	Sep 30,				Jun 30,		Sep 30,
	2023		2022		2023		2023		2022
Revenue	$	635,180	$	559,671	$	597,910	$	1,770,077	$	1,529,861
Gross Margin		114,697		95,754		101,080		293,342		217,275
Income (Loss) from Operations		57,929		46,875		49,199		133,878		68,686
Net Income (Loss)		29,812		18,303		19,002		52,874		2,813
Diluted Earnings (Loss) Per Share	$	0.29	$	0.18	$	0.19	$	0.52	$	0.03

For the third quarter of 2023:

• Net income was $29.8 million and consolidated adjusted EBITDA was $84.1 million
• Consolidated operating income was $57.9 million
• Cash position increased by $52.4 million, from $504 million to $556 million

As of September 30, 2023:

• Remotely Operated Vehicles (ROV): fleet count was 250; Q3 utilization was 69%; and Q3 average revenue per day on hire was $9,372
• Manufactured Products backlog was $556 million

Revised full year 2023 guidance:

• Net income in the range of $75 million to $90 million
• Consolidated adjusted EBITDA in the range of $275 million to $295 million
• Free cash flow generation in the range of $90 million to $130 million
• Capital expenditures in the range of $95 million to $105 million

Initial full year 2024 Guidance:

• Consolidated EBITDA in the range of $330 million to $380 million
• Free cash flow generation to exceed that generated in 2023

Roderick A. Larson, President and Chief Executive Officer of Oceaneering, stated, "Our third quarter 2023 results, improved as compared to the second quarter of 2023, were primarily due to increased activity and improved pricing in our Offshore Projects Group (OPG) and Subsea Robotics (SSR) segments. In addition, we saw improvements in our Aerospace and Defense Technologies (ADTech) operating results. These results contributed to our adjusted consolidated EBITDA of $84.1 million, which was at the upper end of our guided range and exceeded consensus estimates. For the full year of 2023, we forecast our adjusted EBITDA to be within the narrowed range of $275 million to $295 million and expect positive free cash flow to remain in our previously guided range of $90 million to $130 million.

"Consistent with our message over the last several quarters, we continue to see improvement in market conditions that support our expectation of generating consolidated EBITDA in 2024 in the range of $330 million to $380 million. At the respective midpoints of our 2023 and 2024 guidance, this represents a 25% year-over-year increase. In 2024, we also expect to generate positive free cash flow in excess of that generated in 2023."

Segment Results

Sequentially, SSR revenue and operating income in the third quarter of 2023 both increased, as expected, with lower ROV activity being offset by slight ROV pricing improvements and higher survey activity. SSR EBITDA margin of 31% improved over the 30% achieved in the second quarter of 2023.

Sequentially, third quarter 2023 ROV days on hire were 1% lower. Fleet utilization declined slightly to 69% for the quarter as compared to 70% during the second quarter. Fleet use during the quarter was 61% in drill support and 39% in vessel-based activity, the same as in the preceding quarter. Third quarter 2023 average ROV revenue per day on hire of $9,372 was 3% higher than the average ROV revenue per day on hire in the second quarter of 2023.

Manufactured Products third quarter 2023 sequential operating results and margin, respectively, declined to $8.2 million and 7%, on a 2% decrease in revenue. These declines were primarily due to changes in product mix. Order intake during the quarter was strong, with backlog on September 30, 2023 increasing to $556 million from June 30, 2023 backlog of $418 million. Book-to-bill ratio increased to 1.25 for the nine months ended September 30, 2023, and 1.41 for the trailing 12 months.

As expected, OPG saw strong seasonal demand and international activity during the third quarter of 2023, which resulted in higher operating income on a 15% increase in revenue as compared to the second quarter of 2023. OPG’s operating income margin of 18% improved over the second quarter of 2023, reflecting increased global demand for vessel-based services, changes in service mix, and the successful resolution of a commercial dispute.

Sequentially, Integrity Management and Digital Solutions (IMDS) third quarter 2023 operating income declined slightly on a 5% increase in revenue. Operating income margin of 5% declined from the 6% recorded for the second quarter of 2023. ADTech third quarter 2023 operating income increased significantly over the second quarter on a 6% increase in revenue. Operating income margin of 14% improved from the second quarter of 2023. At the corporate level, Unallocated Expenses of $42.2 million for the third quarter of 2023 were less than forecasted due to lower-than-expected accruals for performance-based incentive compensation.

Fourth Quarter and Full Year 2023 Outlook:

On a consolidated basis, Oceaneering forecasts fourth quarter 2023 EBITDA to decline on relatively flat revenue as compared to third quarter results. Sequential segment forecasts are for: relatively flat operating income on slightly lower revenue from SSR; higher revenue and significantly lower operating profitability from Manufactured Products; slightly lower revenue and significantly lower operating income from OPG; lower revenue and operating income from IMDS; and slightly lower revenue and lower operating income from ADTech. Oceaneering forecasts fourth quarter Unallocated Expenses to be in the low-$40 million range.

For the full year of 2023, Oceaneering expects to generate adjusted EBITDA within the narrowed range of $275 million to $295 million. Revised guidance range for organic capital expenditures is $95 million to $105 million and revised guidance range for cash income tax payments is $70 million to $75 million. Oceaneering's guidance for positive free cash flow generation remains in the range of $90 million to $130 million for the full year of 2023.

Initial 2024 Guidance:

For 2024, year over year, Oceaneering anticipates increased revenue and improved operating performance across each of its operating segments, led by gains from SSR and OPG. At this time, Oceaneering forecasts 2024 EBITDA to be in the range of $330 million to $380 million, driving meaningful levels of cash flow from operations. Oceaneering anticipates organic capital expenditures in 2024 to be flat to modestly higher than in 2023 as the company continues to focus on growth in its robotics platforms. Oceaneering also expects to generate positive free cash flow in excess of that generated in 2023. The company plans to provide more specific guidance on its expectations for 2024 in our fourth quarter 2023 earnings release and conference call.

Liquidity:

On September 20, 2023, the company initiated a series of transactions designed to address the maturity of its 2024 senior notes. Once the final transaction is completed in November 2023, Oceaneering will have significantly extended its debt maturity to February 2028 while maintaining substantial liquidity. Oceaneering's continuing commitment to managing its debt maturities, maintaining a strong balance sheet, and generating meaningful free cash flow supports its ability to fund future growth and shareholder return aspirations.

This release contains "forward-looking statements," as defined in the Private Securities Litigation Reform Act of 1995, including, without limitation, statements as to the expectations, beliefs, future expected business and financial performance and prospects of Oceaneering. More specifically, the forward-looking statements in this press release include the statements concerning Oceaneering’s: full-year 2023 guidance ranges for net income, consolidated adjusted EBITDA, free cash flow generation, and capital expenditures; fourth quarter 2023 sequential directional guidance for consolidated adjusted EBITDA and revenue, operating segment revenues, operating results and operating profitability, and guidance for Unallocated Expenses; expected full-year 2023 guidance ranges for adjusted EBITDA, organic capital expenditures, cash income tax payments, and free cash flow; full-year 2024 sequential activity and operating performance across each operating segment, led by SSR and OPG; full-year 2024 EBITDA range anticipated to drive cash flow from operations; anticipated sequential direction of 2024 organic capital expenditures; expected free cash flow guidance; anticipated plans to provide more specific guidance on its expectations for 2024 during the year-end reporting process; completion of 2024 senior notes transaction; funding future growth and shareholder return aspirations; and characterization of market fundamentals, conditions and dynamics, robotics platforms, offshore energy activity levels, pricing levels, day rates, average ROV revenue per day on hire, growth, bidding activity, outlook, performance, opportunities, results, and financials as increasing, favorable, positive, encouraging, improving, seasonal, strong, supportive, robust, meaningful, healthy, or significant (which is used herein to indicate a change of 20% or greater).

The forward-looking statements included in this release are based on our current expectations and are subject to certain risks, assumptions, trends, and uncertainties that could cause actual results to differ materially from those indicated by the forward-looking statements. Among the factors that could cause actual results to differ materially include: factors affecting the level of activity in the oil and gas industry, including worldwide demand for and prices of oil and natural gas, oil and natural gas production growth and the supply and demand of offshore drilling rigs; actions by members of OPEC and other oil exporting countries; decisions about offshore developments to be made by oil and gas exploration, development and production companies; the use of subsea completions and our ability to capture associated market share; general economic and business conditions and industry trends; the strength of the industry segments in which we are involved; the continuing effects of the COVID-19 pandemic and variants thereof, and the governmental, customer, supplier, and other responses thereto; cancellations of contracts, change orders and other contractual modifications, force majeure declarations and the exercise of contractual suspension rights and the resulting adjustments to our backlog; collections from our customers; our future financial performance, including as a result of the availability, terms and deployment of capital; the consequences of significant changes in currency exchange rates; the volatility and uncertainties of credit markets; changes in tax laws, regulations and interpretation by taxing authorities; changes in, or our ability to comply with, other laws and governmental regulations, including those relating to the environment; the continued availability of qualified personnel; our ability to obtain raw materials and parts on a timely basis and, in some cases, from limited sources; operating risks normally incident to offshore exploration, development and production operations; hurricanes and other adverse weather and sea conditions; cost and time associated with drydocking of our vessels; the highly competitive nature of our businesses; adverse outcomes from legal or regulatory proceedings; the risks associated with integrating businesses we acquire; rapid technological changes; and social, political, military and economic situations in foreign countries where we do business and the possibilities of civil disturbances, war, other armed conflicts or terrorist attacks. For a more complete discussion of these and other risk factors, please see Oceaneering’s latest annual report on Form 10-K and subsequent quarterly reports on Form 10-Q filed with the Securities and Exchange Commission. You should not place undue reliance on forward-looking statements. Except to the extent required by applicable law, Oceaneering undertakes no obligation to update or revise any forward-looking statement.

Oceaneering is a global technology company delivering engineered services and products and robotic solutions to the offshore energy, defense, aerospace, manufacturing, and entertainment industries.

For more information on Oceaneering, please visit www.oceaneering.com.

- Tables follow -

OCEANEERING INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
										Sep 30, 2023			Dec 31, 2022
										(in thousands)
ASSETS
Current assets (including cash and cash equivalents of $556,427 and $568,745)										$	1,458,590		$	1,297,060
Net property and equipment											421,820			438,449
Other assets											432,039			296,174
Total Assets										$	2,312,449		$	2,031,683
LIABILITIES AND EQUITY
Current liabilities										$	800,474		$	568,414
Long-term debt											568,471			700,973
Other long-term liabilities											371,169			236,492
Equity											572,335			525,804
Total Liabilities and Equity										$	2,312,449		$	2,031,683
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
	For the Three Months Ended									For the Nine Months Ended
	Sep 30, 2023			Sep 30, 2022			Jun 30, 2023			Sep 30, 2023			Sep 30, 2022
	(in thousands, except per share amounts)
Revenue	$	635,180		$	559,671		$	597,910		$	1,770,077		$	1,529,861
Cost of services and products		520,483			463,917			496,830			1,476,735			1,312,586
Gross margin		114,697			95,754			101,080			293,342			217,275
Selling, general and administrative expense		56,768			48,879			51,881			159,464			148,589
Income (loss) from operations		57,929			46,875			49,199			133,878			68,686
Interest income		3,724			1,396			4,154			12,344			2,959
Interest expense		(9,802	)		(9,552	)		(9,517	)		(28,602	)		(28,614	)
Equity in income (losses) of unconsolidated affiliates		498			496			479			1,616			1,108
Other income (expense), net		968			(1,222	)		(5,846	)		(4,800	)		(195	)
Income (loss) before income taxes		53,317			37,993			38,469			114,436			43,944
Provision (benefit) for income taxes		23,505			19,690			19,467			61,562			41,131
Net Income (Loss)	$	29,812		$	18,303		$	19,002		$	52,874		$	2,813
Weighted average diluted shares outstanding		102,206			101,310			102,004			102,086			101,372
Diluted earnings (loss) per share	$	0.29		$	0.18		$	0.19		$	0.52		$	0.03
The above Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Operations should be read in conjunction with the Company's latest Annual Report on Form 10-K and Quarterly Report on Form 10-Q.

SEGMENT INFORMATION
		For the Three Months Ended									For the Nine Months Ended
		Sep 30, 2023			Sep 30, 2022			Jun 30, 2023			Sep 30, 2023			Sep 30, 2022
	($ in thousands)
Subsea Robotics
Revenue		$	197,343		$	169,422		$	186,512		$	553,016		$	454,534
Gross margin		$	60,045		$	47,552		$	53,204		$	157,880		$	106,514
Operating income (loss)		$	47,818		$	37,069		$	42,227		$	123,699		$	74,559
Operating income (loss) %			24	%		22	%		23	%		22	%		16	%
ROV days available			23,000			23,000			22,750			68,250			68,250
ROV days utilized			15,932			15,408			16,032			46,192			41,881
ROV utilization			69	%		67	%		70	%		68	%		61	%
Manufactured Products
Revenue		$	122,877		$	94,039		$	124,882		$	360,698		$	282,187
Gross margin		$	16,916		$	12,170		$	19,020		$	55,690		$	31,090
Operating income (loss)		$	8,229		$	4,282		$	10,607		$	30,116		$	5,560
Operating income (loss) %			7	%		5	%		8	%		8	%		2	%
Backlog at end of period		$	556,000		$	365,000		$	418,000		$	556,000		$	365,000
Offshore Projects Group
Revenue		$	150,273		$	152,987		$	130,547		$	385,127		$	366,841
Gross margin		$	33,045		$	27,647		$	24,602		$	70,671		$	60,825
Operating income (loss)		$	26,745		$	20,310		$	17,132		$	49,391		$	38,511
Operating income (loss) %			18	%		13	%		13	%		13	%		10	%
Integrity Management & Digital Solutions
Revenue		$	66,056		$	58,465		$	63,166		$	189,305		$	174,473
Gross margin		$	9,961		$	8,371		$	10,264		$	29,074		$	26,792
Operating income (loss)		$	3,242		$	3,091		$	3,844		$	10,168		$	10,035
Operating income (loss) %			5	%		5	%		6	%		5	%		6	%
Aerospace and Defense Technologies
Revenue		$	98,631		$	84,758		$	92,803		$	281,931		$	251,826
Gross margin		$	20,295		$	19,431		$	17,675		$	53,070		$	52,045
Operating income (loss)		$	14,140		$	13,043		$	11,357		$	33,993		$	33,848
Operating income (loss) %			14	%		15	%		12	%		12	%		13	%
Unallocated Expenses
Gross margin		$	(25,565	)	$	(19,417	)	$	(23,685	)	$	(73,043	)	$	(59,991	)
Operating income (loss)		$	(42,245	)	$	(30,920	)	$	(35,968	)	$	(113,489	)	$	(93,827	)
Total
Revenue		$	635,180		$	559,671		$	597,910		$	1,770,077		$	1,529,861
Gross margin		$	114,697		$	95,754		$	101,080		$	293,342		$	217,275
Operating income (loss)		$	57,929		$	46,875		$	49,199		$	133,878		$	68,686
Operating income (loss) %			9	%		8	%		8	%		8	%		4	%
The above Segment Information does not include adjustments for non-recurring transactions. See the tables below under the caption "Reconciliations of Non-GAAP to GAAP Financial Information" for financial measures that our management considers in evaluating our ongoing operations.

SELECTED CASH FLOW INFORMATION
	For the Three Months Ended						For the Nine Months Ended
	Sep 30, 2023		Sep 30, 2022		Jun 30, 2023		Sep 30, 2023		Sep 30, 2022
	(in thousands)
Capital Expenditures, including Acquisitions	$	25,945	$	19,280	$	22,428	$	66,681	$	55,094
Depreciation and Amortization:
Energy Services and Products
Subsea Robotics	$	12,805	$	16,013	$	13,356	$	41,101	$	52,545
Manufactured Products		3,067		2,939		3,013		9,124		9,031
Offshore Projects Group		6,931		7,132		6,976		21,035		21,536
Integrity Management & Digital Solutions		909		1,695		939		2,706		3,759
Total Energy Services and Products		23,712		27,779		24,284		73,966		86,871
Aerospace and Defense Technologies		600		671		632		1,885		2,148
Unallocated Expenses		1,284		1,799		1,130		3,612		4,109
Total Depreciation and Amortization	$	25,596	$	30,249	$	26,046	$	79,463	$	93,128

RECONCILIATIONS OF NON-GAAP TO GAAP FINANCIAL INFORMATION

In addition to financial results determined in accordance with U.S. generally accepted accounting principles ("GAAP"), this Press Release also includes non-GAAP financial measures (as defined under certain rules and regulations promulgated by the Securities and Exchange Commission). We have included Adjusted Net Income (Loss) and Diluted Earnings (Loss) per Share, each of which excludes the effects of certain specified items, as set forth in the tables that follow. As a result, these amounts are non-GAAP financial measures. We believe these are useful measures for investors to review because they provide consistent measures of the underlying results of our ongoing business. Furthermore, our management uses these measures as measures of the performance of our operations. We have also included disclosures of Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), EBITDA Margins, 2023 Adjusted EBITDA Estimates, and Free Cash Flow, as well as the following by segment: EBITDA, EBITDA Margins, Adjusted EBITDA and Adjusted EBITDA Margins. We define EBITDA Margin as EBITDA divided by revenue. Adjusted EBITDA and Adjusted EBITDA Margins and related information by segment exclude the effects of certain specified items, as set forth in the tables that follow. EBITDA and EBITDA Margins, Adjusted EBITDA and Adjusted EBITDA Margins, and related information by segment are each non-GAAP financial measures. We define Free Cash Flow as cash flow provided by operating activities less organic capital expenditures (i.e., purchases of property and equipment other than those in business acquisitions). We have included these disclosures in this press release because EBITDA, EBITDA Margins and Free Cash Flow are widely used by investors for valuation purposes and for comparing our financial performance with the performance of other companies in our industry, and the adjusted amounts thereof provide more consistent measures than the unadjusted amounts. Furthermore, our management uses these measures for purposes of evaluating our financial performance. Our presentation of EBITDA, EBITDA Margins and Free Cash Flow (and the Adjusted amounts thereof) may not be comparable to similarly titled measures other companies report. Non-GAAP financial measures should be viewed in addition to and not as substitutes for our reported operating results, cash flows or any other measure prepared and reported in accordance with GAAP. The tables that follow provide reconciliations of the non-GAAP measures used in this press release to the most directly comparable GAAP measures.

RECONCILIATIONS OF NON-GAAP TO GAAP FINANCIAL INFORMATION
(continued)
Adjusted Net Income (Loss) and Diluted Earnings (Loss) per Share (EPS)
	For the Three Months Ended
	Sep 30, 2023					Sep 30, 2022					Jun 30, 2023
	Net Income (Loss)			Diluted EPS		Net Income (Loss)			Diluted EPS		Net Income (Loss)			Diluted EPS
	(in thousands, except per share amounts)
Net income (loss) and diluted EPS as reported in accordance with GAAP	$	29,812		$	0.29	$	18,303		$	0.18	$	19,002		$	0.19
Pre-tax adjustments for the effects of:
Foreign currency (gains) losses		(944	)				1,145					4,845
Total pre-tax adjustments		(944	)				1,145					4,845
Tax effect on pre-tax adjustments at the applicable jurisdictional statutory rate in effect for respective periods		615					(174	)				(2,387	)
Discrete tax items:
Share-based compensation		—					—					(3	)
Uncertain tax positions		13,076					1,813					4,312
Valuation allowances		9,353					452					(8,678	)
Other		(13,430	)				2,162					1,563
Total discrete tax adjustments		8,999					4,427					(2,806	)
Total of adjustments		8,670					5,398					(348	)
Adjusted Net Income (Loss)	$	38,482		$	0.38	$	23,701		$	0.23	$	18,654		$	0.18
Weighted average diluted shares outstanding utilized for Adjusted Net Income (Loss)					102,206					101,310					102,004
Adjusted Net Income (Loss) and Diluted Earnings (Loss) per Share (EPS)
						For the Nine Months Ended
						Sep 30, 2023					Sep 30, 2022
						Net Income (Loss)			Diluted EPS		Net Income (Loss)			Diluted EPS
						(in thousands, except per share amounts)
Net income (loss) and diluted EPS as reported in accordance with GAAP						$	52,874		$	0.52	$	2,813		$	0.03
Pre-tax adjustments for the effects of:
Foreign currency (gains) losses							3,634					(189	)
Total pre-tax adjustments							3,634					(189	)
Tax effect on pre-tax adjustments at the applicable jurisdictional statutory rate in effect for respective periods							(1,688	)				58
Discrete tax items:
Share-based compensation							(1,370	)				137
Uncertain tax positions							17,477					588
Valuation allowances							4,251					18,798
Other							(12,660	)				2,529
Total discrete tax adjustments							7,698					22,052
Total of adjustments							9,644					21,921
Adjusted Net Income (Loss)						$	62,518		$	0.61	$	24,734		$	0.24
Weighted average diluted shares outstanding utilized for Adjusted Net Income (Loss)										102,086					101,372

EBITDA and Adjusted EBITDA and Margins
	For the Three Months Ended									For the Nine Months Ended
	Sep 30, 2023			Sep 30, 2022			Jun 30, 2023			Sep 30, 2023			Sep 30, 2022
	($ in thousands)
Net income (loss)	$	29,812		$	18,303		$	19,002		$	52,874		$	2,813
Depreciation and amortization		25,596			30,249			26,046			79,463			93,128
Subtotal		55,408			48,552			45,048			132,337			95,941
Interest expense, net of interest income		6,078			8,156			5,363			16,258			25,655
Amortization included in interest expense		51			39			37			114			73
Provision (benefit) for income taxes		23,505			19,690			19,467			61,562			41,131
EBITDA		85,042			76,437			69,915			210,271			162,800
Adjustments for the effects of:
Foreign currency (gains) losses		(944	)		1,145			4,845			3,634			(189	)
Total of adjustments		(944	)		1,145			4,845			3,634			(189	)
Adjusted EBITDA	$	84,098		$	77,582		$	74,760		$	213,905		$	162,611
Revenue	$	635,180		$	559,671		$	597,910		$	1,770,077		$	1,529,861
EBITDA margin %		13	%		14	%		12	%		12	%		11	%
Adjusted EBITDA margin %		13	%		14	%		13	%		12	%		11	%

Free Cash Flow
	For the Three Months Ended									For the Nine Months Ended
	Sep 30, 2023			Sep 30, 2022			Jun 30, 2023			Sep 30, 2023			Sep 30, 2022
	(in thousands)
Net Income (loss)	$	29,812		$	18,303		$	19,002		$	52,874		$	2,813
Non-cash adjustments:
Depreciation and amortization		25,596			30,249			26,046			79,463			93,128
Other non-cash		6,381			4,171			2,923			9,116			5,551
Other increases (decreases) in cash from operating activities		17,819			33,176			(27,520	)		(84,313	)		(140,075	)
Cash flow provided by (used in) operating activities		79,608			85,899			20,451			57,140			(38,583	)
Purchases of property and equipment		(25,945	)		(19,280	)		(22,428	)		(66,681	)		(55,094	)
Free Cash Flow	$	53,663		$	66,619		$	(1,977	)	$	(9,541	)	$	(93,677	)
2023 Adjusted EBITDA Estimates
										For the Year Ending
										December 31, 2023
										Low			High
										(in thousands)
Income (loss) before income taxes										$	150,000		$	160,000
Depreciation and amortization											105,000			115,000
Subtotal											255,000			275,000
Interest expense, net of interest income											20,000			20,000
Adjusted EBITDA										$	275,000		$	295,000
2023 Free Cash Flow Estimate
										For the Year Ending
										December 31, 2023
										Low			High
										(in thousands)
Net income (loss)										$	75,000		$	90,000
Depreciation and amortization											105,000			115,000
Other increases (decreases) in cash from operating activities											5,000			30,000
Cash flow provided by (used in) operating activities											185,000			235,000
Purchases of property and equipment											(95,000	)		(105,000	)
Free Cash Flow										$	90,000		$	130,000
2024 Adjusted EBITDA Estimates
										For the Year Ending
										December 31, 2024
										Low			High
										(in thousands)
Income (loss) before income taxes										$	215,000		$	245,000
Depreciation and amortization											105,000			120,000
Subtotal											320,000			365,000
Interest expense, net of interest income											10,000			15,000
Adjusted EBITDA										$	330,000		$	380,000

EBITDA and Adjusted EBITDA and Margins by Segment
	For the Three Months Ended September 30, 2023
	SSR			MP			OPG			IMDS			ADTech			Unallocated Expenses and other			Total
	($ in thousands)
Operating Income (Loss) as reported in accordance with GAAP	$	47,818		$	8,229		$	26,745		$	3,242		$	14,140		$	(42,245	)	$	57,929
Adjustments for the effects of:
Depreciation and amortization		12,805			3,067			6,931			909			600			1,284			25,596
Other pre-tax		—			—			—			—			—			1,517			1,517
EBITDA		60,623			11,296			33,676			4,151			14,740			(39,444	)		85,042
Adjustments for the effects of:
Foreign currency (gains) losses		—			—			—			—			—			(944	)		(944	)
Total of adjustments		—			—			—			—			—			(944	)		(944	)
Adjusted EBITDA	$	60,623		$	11,296		$	33,676		$	4,151		$	14,740		$	(40,388	)	$	84,098
Revenue	$	197,343		$	122,877		$	150,273		$	66,056		$	98,631					$	635,180
Operating income (loss) % as reported in accordance with GAAP		24	%		7	%		18	%		5	%		14	%					9	%
EBITDA Margin		31	%		9	%		22	%		6	%		15	%					13	%
Adjusted EBITDA Margin		31	%		9	%		22	%		6	%		15	%					13	%
	For the Three Months Ended September 30, 2022
	SSR			MP			OPG			IMDS			ADTech			Unallocated Expenses and other			Total
	($ in thousands)
Operating Income (Loss) as reported in accordance with GAAP	$	37,069		$	4,282		$	20,310		$	3,091		$	13,043		$	(30,920	)	$	46,875
Adjustments for the effects of:
Depreciation and amortization		16,013			2,939			7,132			1,695			671			1,799			30,249
Other pre-tax		—			—			—			—			—			(687	)		(687	)
EBITDA		53,082			7,221			27,442			4,786			13,714			(29,808	)		76,437
Adjustments for the effects of:
Foreign currency (gains) losses		—			—			—			—			—			1,145			1,145
Total of adjustments		—			—			—			—			—			1,145			1,145
Adjusted EBITDA	$	53,082		$	7,221		$	27,442		$	4,786		$	13,714		$	(28,663	)	$	77,582
Revenue	$	169,422		$	94,039		$	152,987		$	58,465		$	84,758					$	559,671
Operating income (loss) % as reported in accordance with GAAP		22	%		5	%		13	%		5	%		15	%					8	%
EBITDA Margin		31	%		8	%		18	%		8	%		16	%					14	%
Adjusted EBITDA Margin		31	%		8	%		18	%		8	%		16	%					14	%

	For the Three Months Ended June 30, 2023
	SSR			MP			OPG			IMDS			ADTech			Unallocated Expenses and other			Total
	($ in thousands)
Operating Income (Loss) as reported in accordance with GAAP	$	42,227		$	10,607		$	17,132		$	3,844		$	11,357		$	(35,968	)	$	49,199
Adjustments for the effects of:
Depreciation and amortization		13,356			3,013			6,976			939			632			1,130			26,046
Other pre-tax		—			—			—			—			—			(5,330	)		(5,330	)
EBITDA		55,583			13,620			24,108			4,783			11,989			(40,168	)		69,915
Adjustments for the effects of:
Foreign currency (gains) losses		—			—			—			—			—			4,845			4,845
Total of adjustments		—			—			—			—			—			4,845			4,845
Adjusted EBITDA	$	55,583		$	13,620		$	24,108		$	4,783		$	11,989		$	(35,323	)	$	74,760
Revenue	$	186,512		$	124,882		$	130,547		$	63,166		$	92,803					$	597,910
Operating income (loss) % as reported in accordance with GAAP		23	%		8	%		13	%		6	%		12	%					8	%
EBITDA Margin		30	%		11	%		18	%		8	%		13	%					12	%
Adjusted EBITDA Margin		30	%		11	%		18	%		8	%		13	%					13	%

EBITDA and Adjusted EBITDA and Margins by Segment
	For the Nine Months Ended September 30, 2023
	SSR			MP			OPG			IMDS			ADTech			Unallocated Expenses and other			Total
	($ in thousands)
Operating Income (Loss) as reported in accordance with GAAP	$	123,699		$	30,116		$	49,391		$	10,168		$	33,993		$	(113,489	)	$	133,878
Adjustments for the effects of:
Depreciation and amortization		41,101			9,124			21,035			2,706			1,885			3,612			79,463
Other pre-tax		—			—			—			—			—			(3,070	)		(3,070	)
EBITDA		164,800			39,240			70,426			12,874			35,878			(112,947	)		210,271
Adjustments for the effects of:
Foreign currency (gains) losses		—			—			—			—			—			3,634			3,634
Total of adjustments		—			—			—			—			—			3,634			3,634
Adjusted EBITDA	$	164,800		$	39,240		$	70,426		$	12,874		$	35,878		$	(109,313	)	$	213,905
Revenue	$	553,016		$	360,698		$	385,127		$	189,305		$	281,931					$	1,770,077
Operating income (loss) % as reported in accordance with GAAP		22	%		8	%		13	%		5	%		12	%					8	%
EBITDA Margin		30	%		11	%		18	%		7	%		13	%					12	%
Adjusted EBITDA Margin		30	%		11	%		18	%		7	%		13	%					12	%
	For the Nine Months Ended September 30, 2022
	SSR			MP			OPG			IMDS			ADTech			Unallocated Expenses and other			Total
	($ in thousands)
Operating Income (Loss) as reported in accordance with GAAP	$	74,559		$	5,560		$	38,511		$	10,035		$	33,848		$	(93,827	)	$	68,686
Adjustments for the effects of:
Depreciation and amortization		52,545			9,031			21,536			3,759			2,148			4,109			93,128
Other pre-tax		—			—			—			—			—			986			986
EBITDA		127,104			14,591			60,047			13,794			35,996			(88,732	)		162,800
Adjustments for the effects of:
Foreign currency (gains) losses		—			—			—			—			—			(189	)		(189	)
Total of adjustments		—			—			—			—			—			(189	)		(189	)
Adjusted EBITDA	$	127,104		$	14,591		$	60,047		$	13,794		$	35,996		$	(88,921	)	$	162,611
Revenue	$	454,534		$	282,187		$	366,841		$	174,473		$	251,826					$	1,529,861
Operating income (loss) % as reported in accordance with GAAP		16	%		2	%		10	%		6	%		13	%					4	%
EBITDA Margin		28	%		5	%		16	%		8	%		14	%					11	%
Adjusted EBITDA Margin		28	%		5	%		16	%		8	%		14	%					11	%