 Record Quarterly Gross Margin of 30.3 Since 2015 Reduced Quarterly SGA to Lowest Level Since 2015Second Quarter 2020 Operating cash flow of 26.3 million, resulted in free cash flow generation of 22.1 million Reduced debt by over 26 million, achieved the lowest quarter-end debt level over the past four years Gross margin of 30.3, surpassed the same quarter last year and represents the strongest quarter since 2015 Lowest quarterly SGA since 2015 pre-acquisitions; 22.7 million reduction, or 27.8 year-over-year to 58.9 million Realized cost savings of 35 million, exceeded prior estimate of 20 to 25 millionSUGAR LAND, Texas, Aug. 04, 2020 GLOBE NEWSWIRE -- Team, Inc. NYSE: TISI, a global leading provider of integrated, digitally-enabled asset performance assurance and optimization solutions, today reported its financial results for the second quarter ended June 30, 2020.We are pleased with our second quarter results, reflecting the tremendous efforts made by everyone in the company, said, Amerino Gatti, TEAMs Chairman and Chief Executive Officer. TEAMs second quarter was extremely challenging as we navigated through the pandemic, which caused significant stress and volatility for our clients and employees. Throughout the pandemic, we stayed true to our values by focusing on the health and safety of our employees while simultaneously meeting or exceeding the high quality of service our clients expect. This quarters results demonstrate our ability to execute efficiently and adapt quickly to changes in the marketplace. Through our decisive and aggressive actions, we successfully aligned our cost structure to match the decline in industry activity and the unprecedented 40 drop in revenues in order to maintain margins. While we had previously committed to reducing our second quarter costs by 20 to 25 million, TEAM delivered approximately 35 million in savings during the quarter. Our focus on maintaining margin and reducing expenses allowed us to generate over 22 million in free cash flow and pay down over 26 million of debt, achieving the lowest quarter-end debt level over the past four years.The market moved at a rapid pace throughout the quarter. Activity got off to a difficult start as many of our clients implemented stay-at-home restrictions, delayed projects and significantly cut capital expenditure plans. The unprecedented reduction in activity troughed in April and May, and slowly started to recover in June when global economies, travel and other regulatory restrictions improved. In fact, our Hot-Tapping service line had its best month of the year in June and early indications show our midstream activity is back to 2019 levels.Looking ahead, we expect to see additional improvement in our end markets, led by onstream and call-out activity in the near term, followed by our nested business, and lastly projects and turnarounds later in the year. Continuing to manage what is in our control by making disciplined decisions and prudently evaluating current business economics to ensure costs do not outpace the recovery remains a top priority. We have identified 50 to 75 million of annualized structural and variable cost reductions for the year.TEAMs asset light and scalable operating model, coupled with the depth and breadth of our products and services, has made us even more agile, allowing us to flex with business demands. Our successful revenue diversification initiative expands our portfolio to provide differentiated products and services to a variety of clients across multiple end markets. We believe our geographic footprint, value-added product and service mix, and technology offerings offer TEAM a unique market position, particularly in this environment.We remain committed to driving execution excellence and strong financial performance, to generate significant cash flow. We are taking actions to navigate near-term challenges, while relentlessly innovating for our clients and investing for the future to deliver long-term value for our stakeholders, concluded Mr. Gatti.Financial ResultsConsolidated net loss in the second quarter of 2020 was 13.5 million 0.44 loss per diluted share compared to net income of 6.1 million 0.20 earnings per diluted share in the second quarter of 2019. Adjusted EBITDA, a non-GAAP measure, was 12.7 million for the second quarter of 2020 compared to 32.8 million for the prior year quarter. See the accompanying reconciliation of non-GAAP measures at the end of this earnings release.Consolidated revenues for the second quarter of 2020 were 189.3 million compared to 315.8 million in the prior year quarter. Revenue decreased due to lower activity levels primarily resulting from the impact of COVID-19 and the global oil supplydemand imbalance. In the second quarter of 2020, consolidated gross margin was 57.4 million, or 30.3, compared with 30.0 in the same quarter a year ago.SGA for the second quarter was 58.9 million, down 22.7 million, or a 27.8 improvement from the second quarter of 2019. The companys adjusted measure of operating loss, Adjusted EBIT, was negative 0.2 million in the second quarter compared to a positive 16.7 million in the prior year comparable quarter.Second quarter 2020 reported results include certain net charges not indicative of Teams core operating activities, including: 3.2 million of costs related to severance charges primarily associated with the OneTEAM program restructuring, 177,000 for OneTEAM program professional fees, and 782,000 of other professional fees and legal costs. Net of tax, these items totaled 3.3 million or 0.11 per diluted share.Adjusted net income or loss, Adjusted EBIT, Adjusted EBITDA and free cash flow are non-GAAP financial measures that exclude certain items that are not indicative of Teams core operating activities. A reconciliation of these non-GAAP financial measures to the most comparable GAAP financial measures is at the end of this release.Segment ResultsThe following table illustrates the composition of the companys revenue and operating income loss by segment for the quarters ended June 30, 2020 and 2019 in thousands: Three Months Ended June 30, Increase Decrease 2020 2019 unaudited unaudited Revenues by business segment: IHT80,474 138,658 58,184 42.0 MS92,820 144,897 52,077 35.9 Quest Integrity16,010 32,274 16,264 50.4 Total189,304 315,829 126,525 40.1 Operating income loss: IHT4,740 9,497 4,757 50.1 MS9,899 20,317 10,418 51.3 Quest Integrity689 9,324 8,635 92.6 Corporate and shared support services19,694 26,134 6,440 24.6 Total4,366 13,004 17,370 133.6 Decrease in activity levels across the company were due to the negative impact of the COVID-19 pandemic and the oversupplied oil market that lead to certain clients temporarily closing facilities andor curtailing operations, resulting in the postponement of client projects and lower demand for the companys services. Mechanical Services MS and Inspection and Heat Treating IHT activity was negatively impacted by delays in large projects and turnaround activity. Also negatively impacting this quarters results was a temporary reduction in client nested activity as clients restricted access to facilities. Given the nature and locality of Quest Integritys business, Quest was particularly impacted by the pandemic as stay-at-home orders limited travel and necessitated quarantine restrictions. The travel restrictions resulted in many of Quests second quarter projects getting delayed until the second half of 2020. Cash and DebtConsolidated cash and cash equivalents were 15.6 million at June 30, 2020. We had approximately 53 million of available borrowing capacity with total liquidity of 69 million at June 30, 2020. The companys net debt was 310.9 million at June 30, 2020, compared to 318.4 million at December 31, 2019.Non-GAAP Financial MeasuresThe non-GAAP measures in this earnings release are provided to enable investors, analysts and management to evaluate Teams performance excluding the effects of certain items that management believes impact the comparability of operating results between reporting periods. These measures should be used in addition to, and not in lieu of, results prepared in conformity with generally accepted accounting principles GAAP. A reconciliation of each of the non-GAAP financial measures to the most directly comparable historical GAAP financial measure is contained in the accompanying schedule for each of the fiscal periods indicated.Conference Call and Webcast DetailsTeam, Inc. will host a conference call on Wednesday, Aug. 5, 2020 at 10:00 a.m. Eastern Time 9:00 a.m. Central Time to review its second quarter 2020 results.By Phone: Dial 1-888-699-2378 inside the U.S. or 1-847-852-4067 outside the U.S. at least 10 minutes before the call. A telephone replay will be available through Aug. 12, 2020 by dialing 1-855-859-2056 inside the U.S. or 404-537-3406 outside the U.S. using the Conference ID 1898231.By Webcast: The call will be broadcast over the web and can be accessed on Teams website, under Investor Relations. Please log on at least 10 minutes in advance to register and download any necessary software. A replay will be available shortly after the call.About Team, Inc.Headquartered in Sugar Land, Texas, Team Inc. NYSE: TISI is a global leading provider of integrated, digitally-enabled asset performance assurance and optimization solutions. We deploy conventional to highly specialized inspection, condition assessment, maintenance and repair services that result in greater safety, reliability and operational efficiency for our clients most critical assets. 