PRINCETON JUNCTION, N.J. - MISTRAS Group, Inc. (NYSE:MG), a global provider of technology-enabled asset protection solutions, reported its financial results for the fourth quarter ended December 31, 2023. The company announced a quarterly earnings per share (EPS) of $0.10, which fell short of the analyst consensus estimate of $0.14. However, revenue for the quarter was $182.07 million, surpassing the consensus estimate of $174.16 million and marking an 8.2% increase from the same quarter last year.
The company's net loss was $2.5 million for the quarter, which included $6.3 million of reorganization and other costs and $1.2 million of foreign currency exchange losses. Despite this, the adjusted EBITDA (non-GAAP) for the quarter was $19.2 million, a 22.0% increase from the prior year and the highest fourth-quarter result historically. Full Year 2023 net cash provided by operating activities remained consistent with the prior year at $26.7 million, while free cash flow (non-GAAP) of $3.1 million was lower than the previous year, reflecting increased strategic spending in expanding growth areas.
For the full year 2023, MISTRAS Group reported a revenue increase of 2.6%, driven by growth in the Oil & Gas and Industrials industries. The net loss for the year was $17.5 million, primarily due to reorganization costs and a non-cash goodwill impairment charge. Adjusted EBITDA for the year increased by 13.2% to $65.8 million, in line with the company's revised guidance.
Looking ahead to fiscal year 2024, MISTRAS Group anticipates revenue between $725-$750 million, which aligns with the analyst consensus of $724.7 million. Adjusted EBITDA is expected to be between $84-$89 million, and the company projects free cash flow of $34-$38 million. These projections include an estimated $20 million in incremental benefits from Project Phoenix initiatives.
Interim President and CEO Manny N. Stamatakis expressed confidence in the company's trajectory, stating, "Our fourth quarter performance is evidence of the effectiveness of Project Phoenix initiatives to improve profitability and Adjusted EBITDA through meaningful margin improvement and steps to achieve sustained cost savings." He also emphasized the momentum heading into 2024 and the expectation of one of the company's all-time high performance years.
Senior Executive Vice President and CFO Edward Prajzner commented on the fourth quarter's demonstration of the company's ability to drive significant bottom-line growth through improved sales efficiency and operational productivity. He acknowledged the positive momentum built in the second half of 2023 and the tangible results seen in the fourth quarter.
MISTRAS Group's shares did not experience a significant percentage move following the earnings release, indicating a neutral market response. The company's focus on organic growth investments and improved commercial functions aims to foster revenue growth in expanding areas, including Aerospace shop laboratories and Data Analytical Solutions.
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