 Cash from operations of 28.8 million up 122 and Free cash flow of 25.5 million, up 284, from the year ago quarter Debt repayment of 18.8 million, a quarterly record, with Total debt of 239.4 million Gross Profit Margin expands to 33.1, highest quarterly level in over five years Selling, General Administrative Expense down 10.3 from the year ago quarter PRINCETON JUNCTION, N.J., Aug. 05, 2020 GLOBE NEWSWIRE -- Mistras Group, Inc. MG: NYSE, a leading one source global provider of technology-enabled asset protection solutions, reported financial results for its second quarter ended June 30, 2020.Highlights of the Second Quarter 2020 Revenue of 124.4 million, a decrease of 38 as anticipated Cash from operations of 28.8 million, an increase of 122 Free cash flow of 25.5 million, an increase of 284 Capital expenditures of 3.3 million, a decrease of 48 Debt repayment of 18.8 million; net debt of 216.8 million and cash on-hand of 22.6 million Gross profit margin of 33.1, up from 29.9; an improvement of 320 bps Selling, general and administrative expenses of 37.6 million, down 10.3Highlights of the First Half 2020 Cash from operations of 34.9 million, an increase of 65 Free cash flow of 27.2 million, an increase of 199 Capital expenditures of 7.6 million, a decrease of 36 Debt repayment 15.1 million Gross profit margin of approximately 29, equal to that of last year Selling, general and administrative expenses reduction of 4.5 million All comparisons are consolidated and versus the equivalent prior year period, unless otherwise noted. Net debt equals Gross Debt less Cash and Cash Equivalents The Companys net loss was 2.7 million in the second quarter of 2020, compared with net income of 7.4 million the prior year period. The Company generated adjusted EBITDA of 11.5 million in the second quarter of 2020, compared with 24.0 million in the prior year period. The Company generated 28.8 million of cashflow from operations and 25.5 million of free cashflow flow in the second quarter of 2020, compared with 12.9 million of cashflow from operations and 6.7 million of free cash flow in the prior year period.Chief Executive Officer Dennis Bertolotti stated, Results for the second quarter demonstrate the value of our asset light business model and its ability to generate strong cash flow. Cash from operations more than doubled from a year ago, which enabled us to have a record setting quarter of debt reduction as we aggressively deleverage our balance sheet. As we anticipated, second quarter revenues were down from a year ago in what we still believe is likely to be this years trough quarter, primarily due to the slowdown in inspection activity resulting from our clients prioritization of safety precautions precipitated by the rapid onset of COVID-19, as well as more cautionary customer budgeting. Although revenues were down, our gross profit margins were at the highest quarterly level in over five years, as numerous cost measures implemented to address current market conditions significantly improved efficiency and productivity. The reduction in selling, general and administrative expenses accelerated sequentially from the first quarter, as the cost control actions undertaken late in the first quarter were fully realized in the second quarter. Year-to-date, we have worked hard to maintain our gross profit margin at the same 29 level as in the first half of 2019, despite the significant decrease in revenues. Robust operating cashflow remains paramount for Mistras at 34.9 million for the first six months of 2020, representing one of the key strengths of our business model. Free cashflow in the second quarter alone was 25.5 million, enabling us to pay off 18.8 million of bank debt during the second quarter. Hence, Mistras continues to maintain the liquidity it needs to fund operations through the current market down cycle. We remain optimistic about our plan to generate expanding adjusted EBITDA sequentially in the second half of 2020 over the first half, and maintain positive operating cashflow in the second half of 2020, enabling us to continue to further decrease our total outstanding debt by year end.Stabilization in the crude oil markets and the continuing relaxation of certain stay-in-place mandates are allowing some of our energy industry customers to start projects in the third quarter that were delayed earlier in the year. While it is still extremely difficult to forecast with any degree of certainty, we still believe our markets will progressively improve in the third and fourth quarter. We built momentum at the end of the second quarter which has continued into the third quarter of 2020. As such, we expect a high-teen up to 20 sequential improvement in revenues during the third quarter over the second quarter of 2020. Our plan is to exit fiscal 2020 on a growth trajectory heading into next year. It has been proven many times, that necessity is the driver for dramatic improvements and innovation. We believe the current pandemic is one of those periods wherein industrial companies look at new and innovative ways of performing their work. Mistras believes its customers will be looking for partners with a more sophisticated approach to assist them in condensing their supplier lists and searching for better business intelligence. This is our strategy, knowing that we can apply these tenets not only into our existing customer base, but also new customers or market segments we target in the future. Performance by key segments during the quarter was as follows:Services segment second quarter revenues were 100.7 million, down 37.5 from the year ago quarter, consistent with the slowdown in energy markets and timing of projects due to COVID-19. For the second quarter, gross profit margins were 33.7, up from the year-ago quarter of 29.3, an increase of approximately 440 basis points, due to a favorable mix, coupled with ongoing cost saving initiatives and Canadian wage subsidies.International segment second quarter revenues were 21.3 million, down 42.5 from the year ago quarter, consistent with the anticipated slowdown in European aerospace, continued runoff of the European staff leasing business, timing of projects due to COVID-19 and unfavorable FX translation. International segment second quarter gross profit margin was 25.3, down from 29.8 in the year ago quarter, due to lower utilization.The Companys net debt total debt less cash and cash equivalents was 216.8 million at June 30, 2020, compared to 239.7 million at December 31, 2019. Gross debt decreased by 15.3 million during the first six months of 2020, from 254.7 million at the end of the year to 239.4 million at June 30, 2020.The Company generated 34.9 million of cash flows from operations in the first half of 2020, compared with 21.1 million in the year ago period. Free cash flow was 27.2 million in the first half of 2020, compared with 9.1 million in year ago period. Free cash flow benefitted from a reduction in cash paid for capital expenditures, interest expense and income taxes. Cash on-hand was 22.6 million at June 30, 2020, an increase of 7.6 million from December 31, 2019.The Companys net loss was 101.2 million in the first half of 2020, compared with net income of 2.1 million the prior year period, due primarily to the after-tax 92.1 million non-cash impairment charges recorded during the first quarter of 2020. The Company generated adjusted EBITDA of 16.9 million in the first six months of 2020, compared with 36.7 million in the prior year period. Outlook for the Second Half of 2020 The ongoing COVID-19 pandemic continues to impact the Companys two largest markets, Oil Gas and Aerospace. Nevertheless, the Company anticipates a high-teen up to 20 sequential improvement in revenues for the third quarter of 2020 compared to the second quarter, but down from the year ago quarter. While it is extremely difficult to forecast with any degree of certainty at this time, the Company believes that consolidated revenue in the second half of 2020 will be higher than the first half of 2020, with a progressive improvement in adjusted EBITDA and continuing positive free cash flow in the second half of 2020. This outlook is contingent on continuing macroeconomic stability, including the recent recovery in the crude oil markets and the ongoing relaxation of certain stay-in-place mandates.Conference Call In connection with this release, MISTRAS will hold a conference call on August 6, 2020 at 9:30 a.m. Eastern. The call will be broadcast over the Web and can be accessed on MISTRAS Website, Individuals in the U.S. wishing to participate in the conference call by phone may dial 1-844-832-7227 and use confirmation code 3195165 when prompted. The International dial-in number is 1-224-633-1529. Those who wish to listen to the call later can access an archived copy of the conference call at the MISTRAS Website.About MISTRAS Group, Inc. - One Source for Asset Protection SolutionsMISTRAS Group, Inc. NYSE: MG is a leading one source multinational provider of integrated technology-enabled asset protection solutions, helping to maximize the safety and operational uptime for civilizations most critical industrial and civil assets.Backed by an innovative, data-driven asset protection portfolio, proprietary technologies, and decades-long legacy of industry leadership, MISTRAS leads clients in the oil and gas, aerospace and defense, power generation, civil infrastructure, and manufacturing industries towards achieving and maintaining operational excellence. 