MRC GLOBAL ANNOUNCES

SECOND-QUARTER RESULTS

MRC Global recently announced second quarter 2021 results. The company’s sales were $686 million for the second quarter of 2021, which was 13% higher than the first quarter of 2021 and 14% higher than the second quarter of 2020.

Sequentially, gas utilities led the revenue growth as customers continued executing integrity upgrade plans on their natural gas distribution networks. As compared to the second quarter of 2020, broad economic recovery drove improvement in sales across all sectors, except midstream pipeline.

“Our second quarter results were strong with 13% higher revenue sequentially, led by gains in our industry-leading gas utilities business. Increased revenue, along with continued emphasis on cost control, resulted in higher adjusted EBITDA margins of 5.2%, positive cash flow generation of $23 million and a significantly improved leverage ratio of 2.2 times,” said Rob Saltiel, MRC Global’s president and CEO said.  “Our financial results reflect improving market conditions and our commitment to superior customer service and operational efficiency. We are increasingly optimistic about our outlook across all of our end-markets, including the energy transition space, through the second half of 2021 and into 2022."

MRC Global’s second quarter of 2021 gross profit was $112 million, or 16.3% of sales, as compared to the second quarter of 2020 gross profit of $79 million, or 13.1% of sales. Gross profit for the second quarter of 2021 includes $11 million of expense in cost of sales relating to the use of the last-in, first-out (LIFO) method of inventory cost accounting as compared to the second quarter of 2020, which reduced cost of sales by $6 million. Adjusted gross profit, which excludes the impact of LIFO was $134 million, or 19.5% of revenue, for the second quarter of 2021 and was $118 million, or 19.6% of revenue, for the second quarter of 2020.

U.S. sales in the second quarter of 2021 were $558 million, up $84 million, or 18%, from the same quarter in 2020. The gas utilities sector drove the increase, followed by the upstream production sector, due to improving economic conditions and higher customer activity levels. Gas utilities sector revenue improved $67 million, or 34%, as a new customer contract was fully implemented and activity increased as pandemic restrictions eased, and customers continued to execute their integrity upgrade programs from the low point in the second quarter of 2020, the distributor noted.

Upstream production sector sales increased by $15 million, or 23%, primarily due to increased customer spending driven by improved commodity prices and a corre-sponding increase in well completions. Downstream and industrial sector sales increased $10 million, or 8%, due to increased turnaround and small project spending. Mid-stream pipeline sector sales declined $8 million, or 10%, due to the completion of non-repeatable project activity in 2020.

Gas utilities sector sales in the second quarter of 2021 were $269 million, or 39% of total sales, an increase of $64 million, or 31%, from the second quarter of 2020, driven by the U.S. segment.

Downstream and industrial sector sales in the second quarter of 2021 were $191 million, or 28% of total sales, an increase of $15 million, or 9%, from the second quar-ter of 2020. The increase in the downstream and industrial sector sales was across all segments, led by the U.S. segment.

Sequentially, downstream and industrial sector sales were down slightly at 2% due to less turnaround work as well as elevated sales in the first quarter of 2021 from recovery work related to inclement weather in February.

Upstream production sector sales in the second quarter of 2021 were $143 million, or 21% of total sales, an improvement of $9 million, or 7%, from the second quarter of 2020. The increase in upstream production sales was led by the U.S. segment.

Sequentially, upstream production sector sales increased $16 million, or 13%, also driven by the U.S. as customers increased spending for completions and facility con-struction. Midstream pipeline sector sales in the second quarter of 2021 were $83 million, or 12% of total sales, a reduction of $4 million, or 5%, from the second quarter of 2020, driven by the U.S. segment. Sequentially, midstream pipeline sector sales increased $5 million, or 6%, due to improving market conditions and small projects.

CORE & MAIN COMPLETES

PACIFIC PIPE PURCHASE

Core & Main closed its previously announced acquisition of Pacific Pipe Co., based in Hawaii. The close of the acquisition is Core & Main’s 13th since becoming an independent company in August 2017.

“The acquisition of Pacific Pipe expands Core & Main’s geographic footprint to Hawaii in partnership with an outstanding team,” said Steve LeClair, CEO of Core & Main. “Core & Main and Pacific Pipe share a commitment to helping communities with sustainable water infrastructure. We look forward to growing together and learning how we can make a positive impact throughout the local communities in Hawaii.”

Based in Hawaii, Pacific Pipe has four locations and serves municipalities and contractors in the water, wastewater, storm drainage and irrigation industries throughout Hawaii with a broad product offering.