WASHINGTON--(BUSINESS WIRE)--The US International Trade Commission on Thursday published the agency's findings following its two-year investigation into SK Innovation's unfair trade practices, concluding that it misappropriated 22 of LG Energy Solution's trade secrets worth billions of dollars spanning the entire electric vehicle battery business.

This public release follows the USITC's orders last month blocking the importation, domestic production, and sale of SK batteries with certain exceptions to prevent job losses or any interruption or delay in the domestic supply chain. The exceptions were unprecedented and allow SK Innovation to continue to exploit the trade secrets it stole for a period of several more years.

"LG Energy Solution's multi-billion dollar investment in its lithium-ion battery business was a down payment on a carbon-free future and an investment we believed was safe from intellectual property thieves," stated Denise Gray, President of LG Energy Solution Michigan Inc. Tech Center. "SK Innovation stole a technology that required tens of thousands of hours of careful and costly engineering. The release of the ITC's decision puts to rest any questions of whether SK Innovation did anything wrong—they did, repeatedly, and now they must be held accountable."

The 96-page final determination provides indisputable evidence of SK Innovation's deliberate, repeated illegal actions and extraordinary bad faith efforts to hinder the Commission's investigation.

The Commission wrote that "SK has a history of collecting documents about LG and SK's competition with LG, and then destroying those documents. For one example, among many, as recently as 2018 ... an SK battery supervisor, ordered his team to hide or destroy 'the documents you took from 'L' company' and 'please don't save this email as well!!'... What is most remarkable about SK's spoliation ... is the combination of the scope of spoliation with its frequency. It was not enough for SK to destroy or hide its records once, because SK then, unchastened, collected more LG propriety information, only to destroy or hide those records as well."

The Commission wrote that it considered "SK's destruction of evidence in this case to be extraordinary" and that "[t]he destruction was ordered at a high level and was carried out by department heads throughout SK."

The Commission found that "[a]s the evidence indicates, SK misappropriated LG's business trade secrets, including LG's competition pricing information. It is therefore consistent with the record that SK's proposal would be the lowest cost." It added that "the record supports the Commission's finding that it would take ten years for SK to develop products without the 22 trade secrets. Accordingly, the Commission finds that the duration of any orders issued should cover a period of 10 years from their effective date."

Finding a violation of Section 337 of the US Tariff Act, the Commission imposed a 10-year-long exclusion order preventing SK Innovation's importation of batteries, battery cells, battery modules, battery packs, and components. The USITC, however, provided a carve-out to allow SK to import identified technology for use in the manufacturing of batteries for Ford and VW at its Georgia facility for four and two years, respectively. The carve-outs protect Ford and VW by providing a window to transition to a new supplier or for SK to develop its own technology or reach a settlement.

"LG Energy Solution is a 20-year partner to America's automotive sector and is working diligently to scale to meet the needs of the country's electric vehicle ecosystem," Denise Gray, President of LG Energy Solution Michigan Inc. Tech Center said. "The protection of trade secrets, as the ITC has provided, will allow those critical investments to continue apace."

In 2019, LGES entered into joint venture with General Motors to build a $2.3 billion manufacturing facility in Ohio to mass-produce battery cells. It also operates an additional battery plant in Michigan and will presently announce further US operations.

For more information, please visit www.LGESvSKI.com.

Press contact:
US: James Richardson, This email address is being protected from spambots. You need JavaScript enabled to view it.
Korea: LGES PR, This email address is being protected from spambots. You need JavaScript enabled to view it.

MINNEAPOLIS--(BUSINESS WIRE)--Northern Oil and Gas, Inc. (NYSE American: NOG) (the “Company”) today announced the expiration and final tender results of its previously announced cash tender offer (the “Offer”) for any and all of its outstanding 8.50% Senior Secured Second Lien Notes due 2023 (the “Notes”). The terms and conditions of the Offer and the Solicitation (as defined below) are set forth in the Company’s Offer to Purchase and Consent Solicitation Statement, dated as of February 3, 2021 (as it may be amended or supplemented from time to time, the “Statement”).

The Offer and the Solicitation expired at 11:59 p.m., New York City time, on March 3, 2021 (the “Expiration Time”) and no tenders submitted after the Expiration Date are valid. According to information provided by D.F. King & Co, Inc., the Information Agent and Tender Agent for the Offer, $1,002 aggregate principal amount of Notes were validly tendered after 5:00 p.m., New York City time, on February 17, 2021 (the “Early Tender and Consent Date”), but at or prior to the Expiration Time, pursuant to the Offer.

The Company expects to accept for purchase all such Notes and the settlement thereof is expected to occur on March 5, 2021 (the “Final Settlement Date”). Holders of Notes accepted for purchase will receive the “Tender Offer Consideration” of $1,000 per $1,000 principal amount of Notes tendered, plus accrued and unpaid interest from and including the last interest payment date up to, but excluding, the Final Settlement Date.

The early results of the Offer were previously announced in the press release dated February 17, 2021. On February 18, 2021 (the “Early Settlement Date”), the Company purchased $272,086,378 aggregate principal amount of Notes, or 94.6% of the then-outstanding Notes, which were validly tendered and not validly withdrawn at or prior to the Early Tender and Consent Date, in accordance with the Statement.

In connection with the Offer, the Company also solicited consents (the “Solicitation”) from the holders of the Notes for certain proposed amendments (the “Proposed Amendments”) to the indenture governing the Notes (the “Indenture”) that would, among other things, eliminate substantially all restrictive covenants and certain of the default provisions contained in the Indenture. All tenders of Notes under the procedures described in the Statement constituted the consent of the holder thereof to the Proposed Amendments. Because consents of the holders of at least a majority of the aggregate principal amount of the outstanding Notes were received as of the Early Tender and Consent Date, on the Early Settlement Date, the Company and Wilmington Trust, National Association, as trustee and as collateral agent under the Indenture, executed and delivered a supplemental indenture to the Indenture implementing the Proposed Amendments. The Proposed Amendments became operative on the Early Settlement Date and apply to all holders of the Notes.

AVAILABLE DOCUMENTS AND OTHER DETAILS

BofA Securities acted as Dealer Manager for the Offer and Solicitation Agent for the Solicitation. Questions regarding the Offer or the Solicitation may be directed to BofA Securities, Inc. at (980) 388-3646. D.F. King & Co., Inc. acted as Information Agent and Tender Agent for the Offer. Requests for copies of the Statement may be directed to D.F. King by telephone at (800) 901-0068 or by email at This email address is being protected from spambots. You need JavaScript enabled to view it..

None of the Company, the Dealer Manager and Solicitation Agent, the Tender Agent and Information Agent, the trustee under the Indenture or any of their respective affiliates made any recommendation as to whether Holders should tender any Notes in response to the Offer and the Solicitation.

This press release is for information purposes only, and does not constitute an offer to sell, a solicitation to buy or an offer to purchase or sell any securities. The Offer and Solicitation were not made in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction.

ABOUT NORTHERN OIL AND GAS

Northern Oil and Gas, Inc. is a company with a primary strategy of investing in non-operated minority working and mineral interests in oil & gas properties, with a core area of focus in the premier basins within the United States.

SAFE HARBOR

This press release contains forward-looking statements regarding future events and future results that are subject to the safe harbors created under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts included in this press release, are forward-looking statements, including, but not limited to, statements regarding the Company’s plans and expected timing with respect to the Offer. When used in this press release, forward-looking statements are generally accompanied by terms or phrases such as “estimate,” “project,” “predict,” “believe,” “expect,” “continue,” “anticipate,” “target,” “could,” “plan,” “intend,” “seek,” “goal,” “will,” “should,” “may” or other words and similar expressions that convey the uncertainty of future events or outcomes. Items contemplating or making assumptions about actual or potential future production and sales, market size, collaborations, and trends or operating results also constitute such forward-looking statements.

Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond the Company’s control) that could cause actual results to differ materially from those set forth in the forward looking statements, including the following: changes in crude oil and natural gas prices; the pace of drilling and completions activity on the Company’s properties and properties pending acquisition; the Company’s ability to acquire additional development opportunities; potential or pending acquisition transactions; the Company’s ability to consummate its recently announced acquisition, the anticipated timing of such consummation, and any anticipated financing transactions in connection therewith; the projected capital efficiency savings and other operating efficiencies and synergies resulting from the Company’s acquisition transactions; integration and benefits of property acquisitions or the effects of such acquisitions on the Company’s cash position and levels of indebtedness; changes in the Company’s reserves estimates or the value thereof; disruptions to the Company’s business due to acquisitions and other significant transactions; general economic or industry conditions, nationally and/or in the communities in which the Company conducts business; changes in the interest rate environment, legislation or regulatory requirements; conditions of the securities markets; the Company’s ability to raise or access capital; changes in accounting principles, policies or guidelines; financial or political instability, acts of war or terrorism, and other economic, competitive, governmental, regulatory and technical factors affecting the Company’s operations, products and prices; and the COVID-19 pandemic and its related economic repercussions and effect on the oil and natural gas industry. Additional information concerning potential factors that could affect future financial results is included in the section entitled “Item 1A. Risk Factors” and other sections of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and the Company’s Quarterly Report on Form 10-Q for the fiscal quarters ended March 31, 2020, June 30, 2020 and September 30, 2020, as updated from time to time in amendments and subsequent reports filed with the SEC, which describe factors that could cause the Company’s actual results to differ from those set forth in the forward looking statements.

The Company has based these forward-looking statements on its current expectations and assumptions about future events. While management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond the Company’s control. The Company does not undertake any duty to update or revise any forward-looking statements, except as may be required by the federal securities laws.

Mike Kelly, CFA
Chief Strategy Officer
(952) 476-9800
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THE WOODLANDS, Texas--(BUSINESS WIRE)--Earthstone Energy, Inc. (NYSE: ESTE) (“Earthstone” or the “Company”), announced today that its management team will host a conference call on Thursday, March 11, 2021 at 10:00 a.m. Eastern (9:00 a.m. Central) to discuss the Company’s financial results for the fourth quarter and full year 2020 and its outlook for 2021. Prepared remarks by Robert J. Anderson, President and Chief Executive Officer, Mark Lumpkin, Jr., Executive Vice President and Chief Financial Officer and Steven C. Collins, Executive Vice President of Operations, will be followed by a question and answer session. The Company intends to file its earnings press release for the period ended December 31, 2020, prior to the conference call.

Investors and analysts are invited to participate in the call by dialing 877-407-6184 for domestic calls or 201-389-0877 for international calls, in both cases asking for the Earthstone conference call. A webcast will also be available through the Company website (www.earthstoneenergy.com). Please select "Events & Presentations" under the "Investors" section of the Company's website and log on at least 10 minutes in advance to register.

A replay of the call and webcast will be available on the Company’s website and by telephone until 10:00 a.m. Eastern (9:00 a.m. Central), Thursday, March 25, 2021. The number for the replay is 877-660-6853 for domestic calls or 201-612-7415 for international calls, using Replay ID: 13717242.

About Earthstone Energy, Inc.

Earthstone Energy, Inc. is a growth-oriented independent oil and gas company engaged in the acquisition, development and operation of oil and natural gas properties. The Company’s primary assets are located in the Midland Basin of west Texas and the Eagle Ford Trend of south Texas. Earthstone is traded on NYSE under the symbol “ESTE.” For more information, visit the Company’s website at www.earthstoneenergy.com.

Mark Lumpkin, Jr.
Executive Vice President – Chief Financial Officer
Earthstone Energy, Inc.
1400 Woodloch Forest Drive, Suite 300
The Woodlands, TX 77380
281-298-4246
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Scott Thelander
Vice President of Finance
Earthstone Energy, Inc.
1400 Woodloch Forest Drive, Suite 300
The Woodlands, TX 77380
281-298-4246
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CALGARY, Alberta--(BUSINESS WIRE)--Seven Generations Energy Ltd. (TSX: VII)

Seven Generations Energy Ltd. today announced that it has issued notices of conditional redemption (the “Conditional Redemption”) to holders for all of its outstanding 6.750% Senior Notes due 2023 (the “6.750% Notes”) at a redemption price of 100.000% plus accrued and unpaid interest, all of its outstanding 6.875% Senior Notes due 2023 (the “6.875% Notes”) at a redemption price of 101.719% plus accrued and unpaid interest and all of its outstanding 5.375% Senior Notes due 2025 (the “5.375% Notes” and collectively with the 6.750% Notes and 6.875% Notes, the “Notes”) at a redemption price of 104.031% plus accrued and unpaid interest. The Conditional Redemption of the 6.875% Notes and 5.375% Notes is expected to occur on or about April 6, 2021 and the Conditional Redemption of the 6.750% Notes is expected to occur on or about May 1, 2021.

As of March 4, 2021, approximately US$378 million aggregate principal amount of the 6.750% Notes was outstanding, approximately US$114 million aggregate principal amount of the 6.875% Notes was outstanding and approximately US$700 million aggregate principal amount of the 5.375% Notes was outstanding.

Completion of the Conditional Redemption is conditional on the completion of the previously announced business combination transaction (the “Business Combination”) with ARC Resources Ltd. (“ARC”) and, with respect to the 6.875% Notes and the 5.375% Notes, the consummation of a refinancing by ARC in an amount sufficient to fund the redemption of the Notes upon closing of the Business Combination. The Business Combination is subject to shareholder approval for both ARC and Seven Generations, regulatory approvals, and other customary closing conditions, and is expected to close in the second quarter of 2021.

This announcement is neither an offer to sell nor a solicitation of an offer to buy any of these securities and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale is unlawful.

Seven Generations is a low supply-cost energy producer dedicated to stakeholder service, responsible development and generating strong returns from its liquids-rich Kakwa River Project in northwest Alberta. 7G’s corporate office is in Calgary, its operations headquarters is in Grande Prairie and its shares trade on the TSX under the symbol VII. Further information is available on the company’s website: www.7genergy.com.

READER ADVISORY

This news release contains certain forward-looking information and statements that involve various risks, uncertainties and other factors. The use of any of the words "anticipate", "continue", "estimate", "expect", "may", "will", "should", "believe", "plans", and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward-looking information and statements pertaining to the following: the timing of completion of the Conditional Redemptions and Business Combination and ARC’s sources of proceeds to fund the Conditional Redemptions upon completion of the Business Combination.

Developing forward-looking information involves reliance on a number of assumptions and consideration of certain risks and uncertainties, some of which are specific to ARC, Seven Generations, and the combined company, and others that apply to the industry generally. The factors or assumptions on which the forward-looking information is based include, but are not limited to: the ability of ARC and Seven Generations to receive, in a timely manner, the necessary regulatory, court, securityholder, stock exchange, and other third-party approvals; the ability of ARC and Seven Generations to satisfy, in a timely manner, the other conditions to the closing of the transaction; interloper risk; the ability to complete the transaction on the terms contemplated by the business combination agreement between ARC and Seven Generations, and other agreements, including the support agreements, or at all; the impacts the transaction may have on the current credit ratings of ARC and Seven Generations and the credit rating of the combined company following closing; sources of funding for the Conditional Redemption; the combined company's ability to carry out transactions on the desired terms and within the expected timelines; the ongoing impact of novel coronavirus COVID-19 on commodity prices and the global economy; and other risks and uncertainties described from time to time in the filings made by ARC and Seven Generations with securities regulatory authorities.

Readers are cautioned that the foregoing lists of factors are not exhaustive. Events or circumstances could cause actual results to differ materially from those estimated or projected and expressed in, or implied by, the forward-looking information. Readers should carefully consider the risk factors discussed in each of ARC's and Seven Generations' most recent management's discussion and analysis and annual information form.

Readers are cautioned against unduly relying on forward-looking statements which, by their nature, involve numerous assumptions, risks and uncertainties that may cause such statements not to occur, or results to differ materially from those expressed or implied.

The forward-looking statements contained in this news release speak only as of the date hereof, and the Company does not assume any obligation to publicly update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable laws.

Seven Generations Energy Ltd. is referred to herein as Seven Generations Energy, Seven Generations, 7G and the Company.

Investor & Analyst Inquiries

Brian Newmarch
Vice President, Capital Markets & Stakeholder Engagement
Phone: 403-718-0700
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Ryan Galloway
Director, Investor Relations
Phone: 403-718-0709
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Media Inquiries

Taryn Bolder
Manager, Communications
Phone: 403-718-0715
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DALLAS--(BUSINESS WIRE)--Arcosa, Inc. (NYSE: ACA) (“Arcosa” or the “Company”), a provider of infrastructure-related products and solutions, today announced that its Board of Directors has declared a regular quarterly cash dividend of $0.05 per share on its $0.01 par value common stock. The quarterly cash dividend is payable April 30, 2021 to stockholders of record as of April 15, 2021.

About Arcosa

Arcosa, Inc. (NYSE:ACA), headquartered in Dallas, Texas, is a provider of infrastructure-related products and solutions with leading positions in construction, engineered structures, and transportation markets. Arcosa reports its financial results in three principal business segments: the Construction Products segment, the Engineered Structures segment, and the Transportation Products segment. For more information, visit www.arcosa.com.

INVESTOR CONTACTS
Scott C. Beasley
Chief Financial Officer

Gail M. Peck
SVP, Finance & Treasurer

T 972.942.6500
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David Gold
ADVISIRY Partners

T 212.661.2220
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MEDIA CONTACT
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Strategic transformation underway, positioned for organic and inorganic growth in 2021

ALEXANDRIA, Va.--(BUSINESS WIRE)--VSE Corporation (NASDAQ: VSEC, “VSE”, or the “Company”), a leading provider of aftermarket distribution and maintenance, repair and overhaul ("MRO") services for land, sea and air transportation assets for government and commercial markets, today announced results for the fourth quarter and full-year 2020.

FOURTH QUARTER 2020 RESULTS
(As compared to the Fourth Quarter 2019)

• Total Revenues of $150.0 million declined 23.2%
• Total Revenues, excluding divestitures, declined 19.6%⁽¹⁾
• GAAP Net Income of $6.0 million declined 39.8%
• Adjusted Net Income of $5.8 million declined 49.8%
• Adjusted EBITDA of $17.3 million declined 25.2%

(1) Excludes the previously announced divestitures of Prime Turbines and CT Aerospace

For the three months ended December 31, 2020, the Company reported total revenue of $150.0 million, versus $195.3 million for the same period ended 2019. The Company reported adjusted net income of $5.8 million or $0.52 per adjusted diluted share, compared to $11.5 million or $1.04 per adjusted diluted share in the prior-year period. Adjusted EBITDA declined to $17.3 million in fourth quarter 2020, versus $23.1 million for the same period in 2019. The Company reported negative free cash flow of $0.9 million during the fourth quarter 2020, which includes $10.7 million of inventory purchases supporting the recently announced new product distribution agreements in the Aviation segment.

Aviation segment revenue, excluding the previously divested Prime Turbines and CT Aerospace assets, declined 26.2% on a year-over-year basis in the fourth quarter 2020, as lower revenue passenger miles at major airline customers resulted in reduced commercial MRO activity. During the fourth quarter, Aviation segment revenue increased 6.5% when compared to the third quarter 2020, supported by a combination of market share gains within the parts distribution business, together with increased demand for parts and services from business and general aviation (B&GA) customers. Federal and Defense segment revenue declined 28.8% on a year-over-year basis in the fourth quarter 2020, primarily due to the completion of a DoD program during the first quarter 2020. Fleet segment revenue increased 0.7% on a year-over-year basis in the fourth quarter 2020, as growth in commercial fleet and e-commerce fulfillment offset a slight decline in U.S. Postal Service-related revenue.

For the twelve months ended December 31, 2020, the Company reported total revenue of $661.7 million, versus $752.6 million in 2019. The Company reported adjusted net income of $29.1 million or $2.63 per adjusted diluted share, compared to $40.2 million or $3.64 per adjusted diluted share in the prior-year period. Adjusted EBITDA declined to $75.2 million in 2020, versus $90.9 million for the same period in 2019. The Company generated $31.3 million of free cash flow in 2020, versus $8.4 million in 2019.

STRATEGY UPDATE

VSE continued to execute on a multi-year business transformation plan during the fourth quarter. The management team remains focused on accelerating the transformation with new business development initiatives and product and service line expansions, in conjunction with disciplined balance sheet management.

• New Business Development. Following a five-year, $100 million exclusive distribution agreement with Triumph Group announced in third quarter 2020, VSE Aviation segment entered into a new exclusive, life-of-program distribution agreement with Pratt & Whitney Canada (P&WC) in January 2021. This agreement expands the Company’s relationship with P&WC into APU parts distribution while expanding its regional and business jet product portfolios. VSE Fleet segment commercial revenue increased 82.5% year-over-year in the fourth quarter and 92.8% for full-year 2020. VSE Federal and Defense segment increased bidding activity by 37% for the full-year 2020.

• Completed Follow-on Equity Offering. In the first quarter of 2021, VSE completed a follow-on equity offering resulting in net cash proceeds of approximately $52 million. Net cash proceeds are expected to be used for general corporate purposes, program launches, and to support complementary, bolt-on acquisitions. VSE is focused on acquisition targets that expand customers and/or product and service capabilities within its existing segments.

• Acquired HAECO Special Services. On March 1, 2021, VSE acquired HAECO Special Services (“HSS”), a division of HAECO Americas (“HAECO”), a leading provider of fully integrated MRO support solutions for military and government aircraft, specifically the KC-10 fleet. This transaction expands VSE’s value-added suite of MRO capabilities for military customers, while positioning the Company to capitalize on higher-margin technical service opportunities.

• Continued Balance Sheet Discipline. VSE is committed to maintaining sufficient liquidity to support the long-term growth of the business, while continuing to support a quarterly cash dividend and conservative net leverage profile. As of December 31, 2020, the Company had $175.5 million in cash and excess availability under its line of credit. For the full-year 2020, VSE reduced total outstanding debt by $19.3 million, supported by free cash flow from operations. On December 31, 2020, the ratio of net debt to our trailing twelve month Adjusted EBITDA was 3.3x, excluding the $52 million in net cash proceeds received from a follow-on equity offering completed in early 2021.

MANAGEMENT COMMENTARY

“In 2020, we successfully navigated pandemic-related disruptions to the global aviation market while continuing to execute on our multi-year business transformation plan,” stated President and CEO John Cuomo. “Throughout the year, we won new business, grew our presence within both new and existing markets, expanded our product and service capabilities into higher-margin verticals, increased our contract bidding activity, divested non-core assets, reduced overhead costs to align with demand conditions, and built a leadership team capable of driving operational excellence at every level of the organization. We are a leaner, more competitive business today than we were entering 2020, laying the foundation for profitable growth in 2021.”

“During the fourth quarter, our Aviation segment reported a second consecutive quarter of sequential revenue growth, driven by a combination of continued share gains and improved demand within the domestic narrow-body aircraft and B&GA markets,” continued Cuomo. “Within our Fleet segment, increased e-commerce fulfillment orders and strong demand from ‘last-mile’ commercial truck fleets contributed to improved year-over-year revenue growth. Although Federal and Defense segment revenue declined on a year-over-year basis, segment Adjusted EBITDA improved due to a more favorable contract mix.”

“This week, in an all-cash transaction, we acquired HAECO Special Services, a leading provider of fully integrated MRO support solutions for military and government aircraft. This transaction is immediately accretive, and positions us to capitalize on higher-margin technical service opportunities within our Federal and Defense Services segment,” continued Cuomo. “We continue to evaluate similar bolt-on acquisitions that accelerate new customer or capability expansion across each of our operating segments.”

“During 2021, we intend to move forward with the next phase of our business transformation plan. This year, our focus turns toward expanding our product and service offerings, continuing to capture share gains within underserved markets, executing inorganic growth opportunities, and accelerating our cultural transformation for our customers and employees,” concluded Cuomo.

“Given the net proceeds from our recently completed follow-on equity offering and the existing availability under our credit facilities, VSE is well-capitalized to support growth in 2021,” stated Stephen Griffin, CFO of VSE Corporation. “This year, our primary capital allocation priorities include working capital investments associated with new distribution agreement wins and investments in additional bolt-on acquisitions. While we expect to allocate operating cash flow toward discretionary growth investments during the first half of 2021, debt reduction remains a key priority, consistent with our disciplined approach to long-term balance sheet management.”

SEGMENT RESULTS

AVIATION
Distribution & MRO Services

VSE’s Aviation segment provides aftermarket MRO and distribution services to commercial, cargo, business and general aviation, military/defense and rotorcraft customers globally. Core services include parts distribution, component and engine accessory MRO services, rotable exchange and supply chain services.

Aviation segment revenue, less contributions from divested Prime Turbines and CT Aerospace businesses, decreased 26.2% year-over-year to $38.6 million in the fourth quarter 2020. The year-over-year revenue decline was attributable to the adverse impact of the COVID-19 pandemic on commercial air traffic, resulting in lower customer demand. On a sequential basis, Aviation segment revenue increased 6.5%, when compared to the third quarter 2020. The Aviation segment recorded an operating loss of $0.8 million in the fourth quarter, versus operating income of $3.1 million in the prior-year period. Adjusted EBITDA decreased to $1.4 million in the fourth quarter 2020.

FLEET
Distribution & Fleet Services

VSE's Fleet segment provides parts, inventory management, e-commerce fulfillment, logistics, supply chain support and other services for commercial aftermarket medium- and heavy-duty truck customers and for the United States Postal Service (USPS) and the United States Department of Defense (DoD). Core services include parts distribution, sourcing, IT solutions, customized fleet logistics, warehousing, kitting, just-in-time supply chain management, alternative product sourcing, engineering and technical support.

Fleet segment revenue increased 0.7% year-over-year to $54.0 million in the fourth quarter 2020. Revenues from commercial customers increased approximately $5.8 million or 82.5%, driven by growth in commercial fleet demand and the e-commerce fulfillment business. Operating income declined 17.2% year-over-year to $6.2 million in the fourth quarter 2020 due to a less favorable sales mix in the period and investment in the business to support continued commercial growth. VSE Fleet segment Adjusted EBITDA declined 16.1% year-over-year in the fourth quarter to $8.5 million.

FEDERAL & DEFENSE
Logistics & Sustainment Services

VSE's Federal and Defense segment provides aftermarket MRO and logistics services to improve operational readiness and to extend the life cycle of military vehicles, ships and aircraft for the U.S. Armed Forces, federal agencies and international defense customers. Core services include base operations support, procurement, supply chain management, vehicle, maritime and aircraft sustainment services, IT services and energy consulting.

Federal and Defense segment revenue declined 28.8% year-over-year to $57.4 million in the fourth quarter 2020, primarily due to the expiration of DoD contracts during the first and third quarters of 2020. Operating income increased 52.0% year-over-year to $7.9 million in the fourth quarter 2020, while Adjusted EBITDA increased 44.4% year-over-year to $8.5 million in the period, due to a more favorable contract mix.

Federal and Defense segment fourth quarter bookings increased 97.4% year-over-year to $75 million. Funded backlog declined 14.1% year-over-year to $183 million. The decline in funded backlog was attributable to the expiration of contracts in the first and third quarters of 2020. The Company continues to focus on revitalizing this business with an emphasis on higher margin growth based on increased technical competencies.

FINANCIAL RESOURCES AND LIQUIDITY

The Company generated $31.3 million of free cash flow in 2020, versus $8.4 million in 2019. As of December 31, 2020, the Company had $175.5 million in cash and unused commitment availability under its $350 million revolving credit facility maturing in 2023. The Company’s existing credit facility includes a $100 million accordion provision, subject to customary lender commitment approvals.

On January 29, 2021, the company priced a previously announced underwritten public offering of common stock that resulted in approximately $52 million net proceeds to the company. VSE expects to use the net proceeds from this offering for general corporate purposes, which may include among other things, financing strategic acquisitions, working capital requirements for new program launches, and repaying outstanding borrowings under its revolving credit facility.

CONFERENCE CALL

A conference call will be held Friday, March 5, 2021 at 8:30 A.M. EST to review the Company’s financial results, discuss recent events and conduct a question-and-answer session.

A webcast of the conference call and accompanying presentation materials will be available in the Investor Relations section of VSE’s website at https://ir.vsecorp.com. To listen to a live broadcast, go to the site at least 15 minutes prior to the scheduled start time in order to register, download, and install any necessary audio software.

To participate in the live teleconference:

Toll Free: 1-877-407-0789
Toll/International: 1-201-689-8562

To listen to a replay of the teleconference through March 19, 2021:

Toll Free: 1-844-512-2921
Toll/International: 1-412-317-6671
Replay Pin Number: 13715744

FOURTH QUARTER RESULTS

FOURTH QUARTER SEGMENT RESULTS

The following is a summary of revenues and operating income (loss) for the three and twelve months ended December 31, 2020 and December 31, 2019:

The Company reported total capital expenditures in the fourth quarter and full-year 2020 of $1.5 million and $4.4 million, respectively.

NON-GAAP MEASURES

In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), this earnings release also contains Non-GAAP financial measures. The reasons why we believe these measures provide useful information to investors and a reconciliation of these measures to the most directly comparable GAAP measures and other information relating to these Non-GAAP measures are included in the supplemental schedules attached.

NON-GAAP FINANCIAL INFORMATION

Reconciliation of Adjusted Net Income and Adjusted EPS to Net Income (Loss)

Reconciliation of Consolidated EBITDA and Adjusted EBITDA to Net Income (Loss)

Reconciliation of Segment EBITDA and Adjusted EBITDA to Operating Income (Loss)

Reconciliation of Operating Cash to Free Cash Flow

Reconciliation of Debt to Net Debt

The non-GAAP Financial Information set forth in this document is not calculated in accordance with U.S. generally accepted accounting principles ("GAAP") under SEC Regulation G. We consider Adjusted Net Income, Adjusted EPS (Diluted), EBITDA, Adjusted EBITDA, trailing-twelve months Adjusted EBITDA, net debt and free cash flow as non-GAAP financial measures and important indicators of performance and useful metrics for management and investors to evaluate our business' ongoing operating performance on a consistent basis across reporting periods. These non-GAAP financial measures, however, should not be considered in isolation or as a substitute for performance measures prepared in accordance with GAAP. Adjusted Net Income represents Net Income adjusted for executive succession costs, 1st Choice Aerospace acquisition-related costs including any earn-out adjustments, facility closures, loss on sale of a business entity and certain assets, gain on sale of property, and related tax impact. Adjusted EPS (Diluted) is computed by dividing net income, adjusted for the discrete items as identified above and the related tax impacts, by the diluted weighted average number of common shares outstanding. EBITDA represents net income before interest expense, income taxes, amortization of intangible assets and depreciation and other amortization. Adjusted EBITDA represents EBITDA (as defined above) adjusted for discrete items as identified above, and trailing-twelve months Adjusted EBITDA is defined as Adjusted EBITDA for the most recent twelve (12) month period ending December 31, 2020. Net debt is defined as total debt less cash and cash equivalents. Free cash flow represents operating cash flow less capital expenditures.

ABOUT VSE CORPORATION

VSE is a leading provider of aftermarket distribution and repair services for land, sea and air transportation assets for government and commercial markets. Core services include maintenance, repair and overhaul (MRO) services, parts distribution, supply chain management and logistics, engineering support, and consulting and training services for global commercial, federal, military and defense customers. VSE also provides information technology and energy consulting services. For additional information regarding VSE’s services and products, visit www.vsecorp.com.

Please refer to the Form 10-K that will be filed with the Securities and Exchange Commission (SEC) on or about March 5, 2021 for more details on our fourth quarter 2020 results. Also, refer to VSE’s Annual Report on Form 10-K for the year ended December 31, 2020 for further information and analysis of VSE’s financial condition and results of operations.

INVESTORS
Noel Ryan
(720) 778-2415
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FORT WORTH, Texas--(BUSINESS WIRE)--FTS International, Inc. (NYSE American: FTSI) today reported its financial and operational results for the fourth quarter and full year 2020.

Michael Doss, Chief Executive Officer, commented “2021 is off to a strong start with us operating 13 active fleets compared to an average of 10.5 in the fourth quarter. Our fleets are continually setting new efficiency records. While market pricing for frac services remains low, we are seeing modest improvements. As a result, we expect to report positive adjusted EBITDA in the first quarter, despite the loss of about 760 stages related to severe winter weather in February. We are optimistic for the remainder of the year and expect activity levels and pricing to continue increasing.”

Restructuring

We emerged from Chapter 11 bankruptcy protection pursuant to a prepackaged plan of reorganization (the “Plan”) on November 19, 2020 and eliminated $488 million of debt and other liabilities as part of our financial restructuring. Upon emergence, we adopted fresh start accounting as a new entity for accounting and financial reporting purposes.

Mr. Doss commented “I’m thankful for our great team, vendors, and customers who helped us continue normal business operations during the financial restructuring process. We are now debt-free with strong liquidity, making us a considerably stronger, more nimble company.”

Results for the fourth quarter are presented separately as the “Predecessor” period from October 1, 2020 through November 19, 2020 and the “Successor” period from November 20, 2020 through December 31, 2020. Similarly, results for the year are presented separately as the “Predecessor” period from January 1, 2020 through November 19, 2020 and the “Successor” period from November 20, 2020 through December 31, 2020.

In addition to presenting Successor and Predecessor periods, we also present our results for the fourth quarter and year ended December 31, 2020 on a combined basis (i.e., by combining the results of the Predecessor and Successor periods). These combined results are not considered to be prepared in accordance with GAAP, but we believe that describing certain period-over-period variances and trends in our activity levels on a combined basis facilitates a meaningful analysis of our operating results and cash flows.

Financial Results

Combined Fourth Quarter 2020 Compared to Third Quarter 2020

• Revenue was $49.8 million, up from $32.1 million
• Net income was $93.3 million, including a positive contribution from reorganization items of $114.9 million, up from a loss of $68.7 million, including a negative contribution of $13.7 million from reorganization items and $18.5 million of transaction costs
• Adjusted EBITDA was $(5.2) million, compared to $(7.6) million
• Capital expenditures were $1.8 million, compared to $2.5 million
• Adjusted EBITDA less capital expenditures was $(7.0) million, compared to $(10.1) million
• Net cash used in operating activities was $12.8 million, including a use of cash of $35.9 million associated with reorganization items, compared to net cash used in operating activities of $37.7 million, including a use of cash of $18.5 million for transaction costs

Combined Full Year 2020 Compared to Full Year 2019

• Revenue was $262.9 million, compared to $776.6 million
• Net loss was $37.8 million, compared to a loss of $72.9 million
• Adjusted EBITDA was $0.4 million, compared to $129.6 million
• Capital expenditures were $21.1 million, compared to $54.4 million
• Adjusted EBITDA less capital expenditures was $(20.7) million, compared to $75.2 million
• Net cash used in operating activities was $43.6 million, including a use of cash of $54.4 million associated with reorganization items, compared to net cash provided by operating activities of $123.9 million

Operational Update

Average active fleets during the fourth quarter was 10.5, up from 7.3 in the third quarter. Utilization of our active fleets averaged 79%, resulting in fully-utilized fleets of 8.3 during the fourth quarter. This compares to 77% utilization and fully-utilized fleets of 5.6 during the third quarter. We exited the fourth quarter with 12 active fleets. Today, we have 13 fleets active with 7 of these fleets being dual fuel capable.

Two of our fleets are working with large independent E&P customers utilizing a simul-frac technique that involves stimulating two horizontal wells at the same time. This technique is gaining increased interest across the industry as a way to further reduce completion costs.

We completed 5,243 stages during the fourth quarter, or 632 stages per fully-utilized fleet. This compares to 3,243 stages during the third quarter, or 579 stages per fully-utilized fleet. In addition, our fleets pumped an average of 15.1 hours per active day in the fourth quarter, compared to an average of 14.9 hours per active day in the third quarter.

Safety Update

We are pleased to report that our safety record for 2020 was the best in our history. Our 2020 Total Recordable Incident Rate (“TRIR”) was 0.20, Lost Time Incident Rate (“LTIR”) was 0.00, and Experience Modification Rate was 0.58. “I am incredibly proud of our employees as a result of these outstanding safety results from approximately 2 million man hours in 2020. We believe these safety rates are considerably better than our industry peer group and set us apart as a solid and reliable partner in the field,” Mr. Doss said.

Liquidity and Capital Resources

Capital expenditures for the combined full year 2020 was $21.1 million with the bulk of these expenditures occurring in the first quarter. Capital expenditures per average active fleet was $2.2 million for the combined full year 2020. For 2021, we expect maintenance capital expenditures will be approximately $2.5 million per average active fleet. Separately, we are actively considering investments in lower-emissions equipment to assist our customers in achieving their ESG initiatives.

As of December 31, 2020, we had $94.0 million of cash and approximately $13.2 million of net availability under our revolving credit facility, or total liquidity of $107.2 million at year end. We had no borrowings under our revolving credit facility during the fourth quarter, which has a total capacity of $40 million. We also had $12.7 million of restricted cash, included in other current assets, as of December 31, 2020 associated with the restructuring.

Overview of Restructuring Related Expenses and Cash Payments

In the combined full year 2020, we paid $54.4 million in cash for fees and expenses related to our financial restructuring. In the third quarter, we incurred and paid $18.5 million of transaction costs prior to our filing for bankruptcy protection, which included $7.0 million paid for legal and professional fees and $11.5 million in consent fees paid to certain secured debt holders pursuant to the Restructuring Support Agreement. In the fourth quarter, we paid $35.9 million, which included $17.1 million for legal and professional fees, $12.5 million in settlement to a sand supplier, and $6.3 million for insurance premiums and emergence cash awards. In addition, we distributed $30.7 million in cash to secured debt holders as consideration under the Plan.

As a result of the restructuring, we terminated our sand supply contracts. Apart from the payment described above, we paid $18.8 million of supply commitment payments in the first half of 2020 under the normal course of business prior to the termination of the contracts. We do not expect any future charges or payments related to these Predecessor contracts.

Conference Call & Webcast

FTS International will hold a conference call that will also be webcast on its website on Friday, March 5, 2021 at 10:00 a.m. Central Time (11:00 a.m. Eastern Time) to discuss the results. Presenting the Company’s results will be Michael Doss, Chief Executive Officer, who will then be joined by Buddy Petersen, Chief Operating Officer and Lance Turner, Chief Financial Officer, for Q&A.

Please see below for instructions on how to access the conference call and webcast. If you intend to ask a question in the Q&A portion of the call, please join by phone.

About FTS International, Inc.

Headquartered in Fort Worth, Texas, FTS International is a pure-play hydraulic fracturing service company with operations across multiple basins in the United States.

To learn more, visit www.FTSI.com.

Forward-Looking Statements

This press release contains forward-looking statements that involve substantial risks and uncertainties and are based on our beliefs and assumptions and on information currently available to us. All statements other than statements of historical facts contained in this press release, including statements regarding our future results of operations, financial condition, capital expenditures, business strategy and plans and objectives of management for future operations, are forward-looking statements. In some cases, these forward-looking statements can be identified by words such as “could,” “should,” “may,” “might,” “will,” “likely,” “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects,” “continues,” “projects” and similar references to future periods.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements represent our beliefs and assumptions only as of the date of this release. These statements, and related risks, uncertainties, factors and assumptions, include, but are not limited to: the effects of our bankruptcy proceedings on our business, liquidity, results of operations and prospects and the interests of various constituents; a further decline or future decline in domestic spending by the onshore oil and natural gas industry; continued volatility or future volatility in oil and natural gas prices; deterioration in general economic conditions or a continued weakening or future weakening of the broader energy industry; federal, state and local regulation of hydraulic fracturing and other oilfield service activities, as well as exploration and production activities, including public pressure on governmental bodies and regulatory agencies to regulate our industry; our ability to obtain permits, approvals and authorizations from governmental and third parties; the effects of or changes to U.S. and foreign government regulation; the price and availability of alternative fuels and energy sources; the discovery rates of new oil and natural gas reserves; and other factors described in our SEC filings, including our Annual Report on Form 10-K for the year ended December 31, 2020 and our subsequent reports on Forms 10-Q and 8-K. These risks are not exhaustive.

Except as required by law, we assume no obligation to update these forward-looking statements, or to update the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future. Further information on factors that could cause actual results to differ materially from the results anticipated by our forward-looking statements is included in the reports we have filed or will file with the Securities and Exchange Commission. These filings, when available, are available on the SEC’s website at www.sec.gov.

Non-GAAP Financial Measures

To provide investors with additional information regarding our financial results, we have disclosed here and elsewhere in this earnings release adjusted EBITDA, a non-GAAP financial measure that we calculate as earnings before net interest expense, taxes, and depreciation and amortization further adjusted for expenses that management believes are non-recurring, and/or non-core to business operations and other non-cash expenses, including but not limited to severance expense, stock-based compensation, balance sheet impairments and write-downs, gains or losses on extinguishment of debt, gains or losses on disposal of assets, gains or losses on divestment of equity interests, supply commitment charges, and restructuring related expenses.

Adjusted EBITDA is a key measure used by our management and board of directors to evaluate our operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital. The exclusion of certain expenses facilitates operating performance comparability across reporting periods by removing the effect of non-cash expenses and certain variable charges. Accordingly, we believe that adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors.

Adjusted EBITDA has limitations as a financial measure and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:

• adjusted EBITDA does not reflect interest income (expense), net; or changes in, or cash requirements for, our working capital;
• although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future and adjusted EBITDA does not reflect capital expenditure requirements for such replacements or for new capital expenditures;
• adjusted EBITDA does not reflect stock-based compensation expenses. Stock-based compensation has been, and will continue to be for the foreseeable future, a recurring expense in our business and an important part of our compensation strategy;
• adjusted EBITDA does not reflect supply commitment charges;
• adjusted EBITDA does not reflect restructuring related expenses;
• other companies, including companies in our industry, may calculate adjusted EBITDA differently, which reduces its usefulness as a comparative measure.

Because of these limitations, you should consider adjusted EBITDA alongside other financial performance measures, including net loss and our other GAAP results.

The table included under “Reconciliation of Net (Loss) Income to Adjusted EBITDA and Calculations of Adjusted EBITDA per Fleet, Adjusted EBITDA Less Capital Expenditures, and Fully-utilized Fleets” provides a reconciliation of net loss to adjusted EBITDA for each of the periods indicated.