MRC Global increases sales 26% YOY
MRC Global Inc., a distributor of pipe, valves and fittings (PVF) and other infrastructure products and services to diversified gas utility, energy and industrial end-markets, reported 2022 sales of $3,363 million, an increase of 26% compared to 2021. Sales for the fourth quarter of 2022 were $869 million, an increase of 27% compared to the same quarter of 2021.
Gross profit for the fourth quarter of 2022 and 2021 each reflect expense of $16 million and $30 million, respectively, in cost of sales relating to the use of the last-in, first out (LIFO) method of inventory cost accounting. Adjusted Gross Profit, which excludes these items, as well as others, was 21.2% in the fourth quarter of 2022 and 21.6% in the fourth quarter of 2021. Results for the full year and fourth quarter 2022 demonstrated strong growth over the prior year:
Full Year 2022 Financial Highlights:
- Sales of $3,363 million, an increase of 26% compared to 2021
- Revenue for each end-market sector increased by double-digits over 2021
- Adjusted EBITDA of $261 million, 7.8% of sales, a 230-basis point improvement over the prior year
- Adjusted Gross Profit, as a percentage of sales, of 21.3%, an MRC Global record for the full year
- Leverage ratio of 1.2x, the lowest leverage in MRC Global history
Fourth Quarter 2022 Financial Highlights:
- Sales of $869 million, an increase of 27% compared to the same quarter of 2021
- Adjusted EBITDA of $66 million, 7.6% of sales, a 70-basis point improvement over the prior year
- Adjusted Gross Profit, as a percentage of sales, of 21.2%, third consecutive quarter exceeding 21%
- Cash flow provided by operations of $10 million during the fourth quarter, for a total of $43 million in the second half of 2022
MRC Global President and Chief Executive Officer Rob Saltiel said, “We had a strong finish to 2022, with fourth quarter revenue consistent with our previous guidance and ahead of the normal seasonal decline. Our full year 2022 performance was exceptional and benefitted greatly from our growth and diversification strategy that emphasized our upstream, chemicals and energy transition endmarkets, all of which outperformed our expectations. Two of our business sectors, Gas Utilities and DIET, exceeded $1 billion in sales, and we increased our company adjusted EBITDA margins to multi-year highs through improved commercial focus and cost discipline. I am proud of the entire MRC Global team for achieving these outstanding results.
"We maintain our positive outlook for 2023 with solid fundamentals anticipated for each of our business sectors and geographic segments. We reaffirm our previous 2023 guidance targeting double-digit revenue growth and adjusted EBITDA margins to exceed 8%. We are increasing our guidance for expected cash flow from operations in 2023 to now exceed $120 million, up from $100 million previously. We are excited about the bright future of MRC Global and the continued growth of our business,” he added.
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