Tetra Technologies, Inc. (NYSE:TTI) Q1 2023 Earnings Conference Call May 2, 2023 10:30 AM ET

Company Participants

Rigo Gonzalez - Corporate Finance & IR Manager

Elijio Serrano - SVP & CFO

Brady Murphy - President, CEO & Director

Conference Call Participants

Martin Malloy - Johnson Rice & Company

Timothy Moore - EF Hutton

Stephen Gengaro - Stifel, Nicolaus & Company

Kay Hoh - Evercore ISI

Operator

Good morning, and welcome to TETRA Technologies First Quarter 2023 Results Conference Call. [Operator Instructions].

I will now turn the conference over to Rigo Gonzalez, Manager of Corporate Finance and Investor Relations. Please go ahead.

Rigo Gonzalez

Thank you, Vaishnavi. Good morning, and thank you for joining TETRA's First Quarter 2023 Results Call. The speaker for today's call are Brady Murphy, Chief Executive Officer; and Elijio Serrano, Chief Financial Officer.

I would like to remind you that this conference call may contain statements that are or may be deemed to be forward-looking. These statements are based on certain assumptions and analysis made by TETRA and are based on several factors. These statements are subject to several risks and uncertainties, many of which are beyond the control of the company. You are cautioned that such statements are not guarantees of future performance and that actual results may differ materially from those projected in the forward-looking statements.

In addition, in the course of the call, we may refer to EBITDA, adjusted EBITDA, adjusted EBITDA gross margins, free cash flow, net debt net leverage ratio, liquidity or other non-GAAP financial measures. Please refer to yesterday's press release or to our public website for reconciliations of non-GAAP financial measures to nearest GAAP measures. These reconciliations are not a substitute for financial information prepared in accordance with GAAP and should be considered within the context of our complete financial results for the period. In addition to our press release announcement that went yesterday, we encourage you to also refer to our 10-Q that we also filed yesterday.

I will now turn it over to Brady.

Brady Murphy

Thank you, Rigo, and good morning, everyone. Welcome to TETRA's First Quarter 2023 Earnings Call.

I'll summarize some highlights for the first quarter, discuss our near-term market outlook and provide an update on our strategic initiatives before turning the call over to Elijio to discuss first quarter financials and provide an update on our second quarter financial outlook.

With the exception of some onetime legal and employee benefits costs, first quarter results were in line with our internal expectations, including stronger EBITDA margins in both of our segments. Adjusted EBITDA, excluding gains or losses on investments increased by 6% quarter-over-quarter and by 8% year-over-year and was the highest adjusted EBITDA since the first quarter of 2020.