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FTAI Infrastructure Inc. Reports Second Quarter 2023 Results, Declares Dividend of $0.03 per Share of Common Stock

NEW YORK, July 25, 2023 (GLOBE NEWSWIRE) -- FTAI Infrastructure Inc. (NASDAQ:FIP) (the “Company” or “FTAI Infrastructure”) today reported financial results for the second quarter 2023. The Company’s consolidated comparative financial statements and key performance measures are attached as an exhibit to this press release.

Financial Overview

(in thousands, except per share data)
Selected Financial ResultsQ2’23
Net Loss Attributable to Stockholders$(38,853) 
Basic and Diluted Loss per Share of Common Stock$(0.38) 
Adjusted EBITDA(1)$27,677  
Adjusted EBITDA - Four core segments(1)(2)$36,153  

_______________________________
(1) For definitions and reconciliations of non-GAAP measures, please refer to the exhibit to this press release.
(2) Excludes Sustainability and Energy Transition and Corporate and Other segments

Second Quarter 2023 Dividends

On July 25, 2023, the Company’s Board of Directors (the “Board”) declared a cash dividend on its common stock of $0.03 per share for the quarter ended June 30, 2023, payable on August 15, 2023 to the holders of record on August 8, 2023.

Business Highlights

  • Adjusted EBITDA of $36.2 million from our four core segments, up 20% vs Q1 of 2023
  • Transtar business unit generated $20.3 million of Adjusted EBITDA for the quarter
  • Executed 15-year contract with first customer at “Jefferson South” terminal for transloading of clean fuels

Additional Information

For additional information that management believes to be useful for investors, please refer to the presentation posted on the Investor Relations section of the Company’s website, www.fipinc.com, and the Company’s Quarterly Report on Form 10-Q, when available on the Company’s website.

Conference Call

In addition, management will host a conference call on Wednesday, July 26, 2023 at 8:00 A.M. Eastern Time. The conference call may be accessed by registering at https://register.vevent.com/register/BI9b1bb57ad78c4240883aa2c3d4164ab8. Once registered, participants will receive a dial-in and unique pin to access the call.

A simultaneous webcast of the conference call will be available to the public on a listen-only basis at https://www.fipinc.com. Please allow extra time prior to the call to visit the site and download the necessary software required to listen to the internet broadcast.

A replay of the conference call will be available after 11:30 A.M. on Wednesday, July 26, 2023 through 11:30 A.M. on Wednesday, August 2, 2023 on https://ir.fipinc.com/news-events/presentations.

The information contained on, or accessible through, any websites included in this press release is not incorporated by reference into, and should not be considered a part of, this press release.

About FTAI Infrastructure Inc.

FTAI Infrastructure primarily invests in critical infrastructure with high barriers to entry across the rail, ports and terminals, and power and gas sectors that, on a combined basis, generate strong and stable cash flows with the potential for earnings growth and asset appreciation. FTAI Infrastructure is externally managed by an affiliate of Fortress Investment Group LLC, a leading, diversified global investment firm.

Cautionary Note Regarding Forward-Looking Statements

Certain statements in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements, many of which are beyond the Company’s control. The Company can give no assurance that its expectations will be attained and such differences may be material. Accordingly, you should not place undue reliance on any forward-looking statements contained in this press release. For a discussion of some of the risks and important factors that could affect such forward-looking statements, see the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, which are available on the Company’s website (www.fipinc.com). In addition, new risks and uncertainties emerge from time to time, and it is not possible for the Company to predict or assess the impact of every factor that may cause its actual results to differ from those contained in any forward-looking statements. Such forward-looking statements speak only as of the date of this press release. The Company expressly disclaims any obligation to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or change in events, conditions or circumstances on which any statement is based. This release shall not constitute an offer to sell or the solicitation of an offer to buy any securities.

For further information, please contact:

Alan Andreini
Investor Relations
FTAI Infrastructure Inc.
(646) 734-9414
aandreini@fortress.com

Exhibit - Financial Statements


FTAI INFRASTRUCTURE INC.
CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Dollar amounts in thousands, except share and per share data)
 
 Three Months Ended June 30, Six Months Ended June 30,
  2023   2022   2023   2022 
Revenues       
Total revenues$81,832  $65,868  $158,326  $112,016 
        
Expenses       
Operating expenses 62,775   49,229   127,937   87,297 
General and administrative 3,702   2,498   6,903   4,928 
Acquisition and transaction expenses 636   8,872   905   13,108 
Management fees and incentive allocation to affiliate 3,084   3,065   6,066   7,226 
Depreciation and amortization 20,292   17,319   40,427   34,315 
Asset impairment 602      743    
Total expenses 91,091   80,983   182,981   146,874 
        
Other income (expense)       
Equity in (losses) earnings of unconsolidated entities (1,625)  (13,859)  2,741   (35,902)
Gain on sale of assets, net 647      523    
Interest expense (24,182)  (6,486)  (47,432)  (12,945)
Other income (expense) 1,370   (553)  1,591   (1,012)
Total other expense (23,790)  (20,898)  (42,577)  (49,859)
Loss before income taxes (33,049)  (36,013)  (67,232)  (84,717)
Provision for income taxes 823   1,947   2,552   3,531 
Net loss (33,872)  (37,960)  (69,784)  (88,248)
Less: Net loss attributable to non-controlling interests in consolidated subsidiaries (10,276)  (8,480)  (20,169)  (15,946)
Less: Dividends and accretion on redeemable preferred stock 15,257      29,827    
Net loss attributable to stockholders/Former Parent$(38,853) $(29,480) $(79,442) $(72,302)
        
Loss per share:       
Basic$(0.38) $(0.30) $(0.77) $(0.73)
Diluted$(0.38) $(0.30) $(0.77) $(0.73)
Weighted average shares outstanding:       
Basic 102,793,800   99,387,467   102,790,737   99,387,467 
Diluted 102,793,800   99,387,467   102,790,737   99,387,467 



FTAI INFRASTRUCTURE INC.
CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollar amounts in thousands, except share and per share data)
    
 (Unaudited)  
 June 30, 2023 December 31, 2022
Assets   
Current assets:   
Cash and cash equivalents$42,523  $36,486 
Restricted cash 54,960   113,156 
Accounts receivable, net 56,375   60,807 
Other current assets 60,581   67,355 
Total current assets 214,439   277,804 
Leasing equipment, net 34,240   34,907 
Operating lease right-of-use assets, net 69,560   71,015 
Property, plant, and equipment, net 1,687,929   1,673,808 
Investments 70,245   73,589 
Intangible assets, net 56,414   60,195 
Goodwill 260,252   260,252 
Other assets 44,531   26,829 
Total assets$2,437,610  $2,478,399 
    
Liabilities   
Current liabilities:   
Accounts payable and accrued liabilities$122,491  $136,048 
Current debt, net 24,037    
Operating lease liabilities 7,070   7,045 
Other current liabilities 28,463   16,488 
Total current liabilities 182,061   159,581 
Debt, net 1,276,641   1,230,157 
Operating lease liabilities 62,207   63,147 
Other liabilities 90,886   236,130 
Total liabilities 1,611,795   1,689,015 
    
Commitments and contingencies   
    
Redeemable preferred stock($0.01 par value per share; 200,000,000 shares authorized; 300,000 shares issued and outstanding as of June 30, 2023 and December 31, 2022; redemption amount of $448.2 million at June 30, 2023 and December 31, 2022) 294,417   264,590 
    
Equity   
Common stock ($0.01 par value per share; 2,000,000,000 shares authorized; 99,470,553 and 99,445,074 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively) 994   994 
Additional paid in capital 874,729   911,599 
Accumulated deficit (110,452)  (60,837)
Accumulated other comprehensive loss (184,727)  (300,133)
Stockholders' equity 580,544   551,623 
Non-controlling interest in equity of consolidated subsidiaries (49,146)  (26,829)
Total equity 531,398   524,794 
Total liabilities, redeemable preferred stock and equity$2,437,610  $2,478,399 



FTAI INFRASTRUCTURE INC.
CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(Dollar amounts in thousands, unless otherwise noted)
 
 Six Months Ended June 30,
  2023   2022 
Cash flows from operating activities:   
Net loss$(69,784) $(88,248)
Adjustments to reconcile net loss to net cash used in operating activities:   
Equity in (earnings) losses of unconsolidated entities (2,741)  35,902 
Gain on sale of assets, net (523)   
Equity-based compensation 1,537   1,665 
Depreciation and amortization 40,427   34,315 
Asset impairment 743    
Change in deferred income taxes 2,110   3,327 
Change in fair value of non-hedge derivative 1,125   (748)
Amortization of deferred financing costs 3,098   1,695 
Amortization of bond discount 2,144    
(Benefit from) provision for credit losses (74)  90 
Change in:   
Accounts receivable 4,506   (30,585)
Other assets (4,724)  (21,583)
Accounts payable and accrued liabilities (16,370)  12,939 
Management fees payable to affiliate 10,168    
Other liabilities 11,427   (4,159)
Net cash used in operating activities (16,931)  (55,390)
    
Cash flows from investing activities:   
Investment in unconsolidated entities (3,315)  (2,745)
Investment in convertible promissory notes    (5,000)
Acquisition of business, net of cash acquired (4,448)  (3,819)
Acquisition of property, plant and equipment (65,696)  (113,916)
Investment in promissory notes and loans (22,000)   
Proceeds from sale of leasing equipment 115    
Proceeds from sale of property, plant and equipment 988   4,304 
Net cash used in investing activities (94,356)  (121,176)
    
Cash flows from financing activities:   
Proceeds from debt 66,600   9,450 
Payment of deferred financing costs (1,192)  (277)
Cash dividends - common stock (6,170)   
Capital contribution from non-controlling interests    562 
Net transfers from Former Parent, net    111,396 
Settlement of equity-based compensation (90)   
Distributions to non-controlling interests (20)   
Net cash provided by financing activities 59,128   121,131 
    
Net decrease in cash and cash equivalents and restricted cash (52,159)  (55,435)
Cash and cash equivalents and restricted cash, beginning of period 149,642   301,855 
Cash and cash equivalents and restricted cash, end of period$97,483  $246,420 


Key Performance Measures

The Chief Operating Decision Maker (“CODM”) utilizes Adjusted EBITDA as our key performance measure.

Adjusted EBITDA provides the CODM with the information necessary to assess operational performance, as well as make resource and allocation decisions. Adjusted EBITDA is defined as net income (loss) attributable to shareholders or Former Parent, adjusted (a) to exclude the impact of provision for (benefit from) income taxes, equity-based compensation expense, acquisition and transaction expenses, losses on the modification or extinguishment of debt and capital lease obligations, changes in fair value of non-hedge derivative instruments, asset impairment charges, incentive allocations, depreciation and amortization expense, interest expense, interest costs on pension and other pension expense benefits (“OPEB”) liabilities, dividends and accretion expense related to redeemable preferred stock, and other non-recurring items, (b) to include the impact of our pro-rata share of Adjusted EBITDA from unconsolidated entities, and (c) to exclude the impact of equity in earnings (losses) of unconsolidated entities and the non-controlling share of Adjusted EBITDA.

The following table sets forth a reconciliation of net loss attributable to stockholders or Former Parent to Adjusted EBITDA for the three and six months ended June 30, 2023 and 2022:

 Three Months Ended June 30, Change
 Six Months Ended
June 30,
 Change
(in thousands) 2023   2022    2023   2022  
Net loss attributable to stockholders/Former Parent$(38,853) $(29,480) $(9,373) $(79,442) $(72,302) $(7,140)
Add: Provision for income taxes 823   1,947   (1,124)  2,552   3,531   (979)
Add: Equity-based compensation expense 642   956   (314)  1,537   1,665   (128)
Add: Acquisition and transaction expenses 636   8,872   (8,236)  905   13,108   (12,203)
Add: Losses on the modification or extinguishment of debt and capital lease obligations                 
Add: Changes in fair value of non-hedge derivative instruments    (1,514)  1,514   1,125   (748)  1,873 
Add: Asset impairment charges 602      602   743      743 
Add: Incentive allocations                 
Add: Depreciation & amortization expense 20,292   17,319   2,973   40,427   34,315   6,112 
Add: Interest expense 24,182   6,486   17,696   47,432   12,945   34,487 
Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities(1) 6,886   6,825   61   15,076   12,232   2,844 
Add: Dividends and accretion on redeemable preferred stock 15,257      15,257   29,827      29,827 
Add: Interest and other costs on pension and OPEB liabilities 480      480   960      960 
Add: Other non-recurring items(2) 51      51   1,339      1,339 
Less: Equity in losses (earnings) of unconsolidated entities 1,625   13,859   (12,234)  (2,741)  35,902   (38,643)
Less: Non-controlling share of Adjusted EBITDA(3) (4,946)  (3,716)  (1,230)  (10,167)  (7,532)  (2,635)
Adjusted EBITDA (non-GAAP)$27,677  $21,554  $6,123  $49,573  $33,116  $16,457 

________________________________________________________

(1) Includes the following items for the three months ended June 30, 2023 and 2022: (i) net loss of $(1,660) and $(13,919), (ii) interest expense of $8,304 and $6,795, (iii) depreciation and amortization expense of $7,967 and $6,349, (iv) acquisition and transaction expenses of $237 and $387, (v) changes in fair value of non-hedge derivative instruments of $(7,963) and $7,118 and (vi) equity-based compensation of $1 and $95, respectively. Includes the following items for the six months ended June 30, 2023 and 2022: (i) net income (loss) of $2,658 and $(36,007), (ii) interest expense of $16,336 and $13,258, (iii) depreciation and amortization expense of $13,633 and $12,633, (iv) acquisition and transaction expenses of $257 and $391, (v) changes in fair value of non-hedge derivative instruments of $(17,810) and $21,732, (vi) equity-based compensation of $2 and $193 and (vii) asset impairment of $— and $32, respectively.
(2) Includes the following items for the three and six months ended June 30, 2023: subsidiary severance expense of $51 and $1,339, respectively.
(3) Includes the following items for the three months ended June 30, 2023 and 2022: (i) equity-based compensation of $76 and $124, (ii) provision for income taxes of $35 and $14, (iii) interest expense of $1,880 and $1,319, (iv) depreciation and amortization expense of $2,944 and $2,321, (v) changes in fair value of non-hedge derivative instruments of $— and $(62), (vi) acquisition and transaction expense of $8 and $—, (vii) interest and other costs on pension and OPEB liabilities of $1 and $— and (viii) asset impairment of $2 and $—, respectively. Includes the following items for the six months ended June 30, 2023 and 2022: (i) equity-based compensation of $186 and $250, (ii) provision for income taxes of $88 and $30, (iii) interest expense of $3,737 and $2,703, (iv) depreciation and amortization expense of $6,080 and $4,585, (v) changes in fair value of non-hedge derivative instruments of $61 and $(36), (vi) other non-recurring items of $3 and $—, (vii) acquisition and transaction expense of $8 and $—, (viii) interest and other costs on pension and OPEB liabilities of $2 and $— and (ix) asset impairment of $2 and $—, respectively.


The following table sets forth a reconciliation of net income (loss) attributable to stockholders to Adjusted EBITDA for our four core segments for the three months ended June 30, 2023:

 Three Months Ended June 30, 2023
(in thousands)Railroad Jefferson Terminal Repauno Power and Gas Four Core Segments
Net income (loss) attributable to stockholders/Former Parent$11,786  $(8,765) $(4,510) $3,059  $1,570 
Add: Provision for income taxes 720   152   40      912 
Add: Equity-based compensation expense 159   303   100      562 
Add: Acquisition and transaction expenses 184   36      49   269 
Add: Losses on the modification or extinguishment of debt and capital lease obligations              
Add: Changes in fair value of non-hedge derivative instruments              
Add: Asset impairment charges 602            602 
Add: Incentive allocations              
Add: Depreciation and amortization expense 5,125   12,144   2,281      19,550 
Add: Interest expense 1,215   7,978   615   1   9,809 
Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities(1)          8,933   8,933 
Add: Dividends and accretion on redeemable preferred stock              
Add: Interest and other costs on pension and OPEB liabilities 480            480 
Add: Other non-recurring items(2) 51            51 
Less: Equity in earnings of unconsolidated entities          (1,639)  (1,639)
Less: Non-controlling share of Adjusted EBITDA(3) (18)  (4,766)  (162)     (4,946)
Adjusted EBITDA$20,304  $7,082  $(1,636) $10,403  $36,153 

________________________________________________________

(1) Power and Gas:
  Includes the following items for the three months ended June 30, 2023: (i) net income of $1,639, (ii) interest expense of $7,378, (iii) depreciation and amortization expense of $7,641, (iv) acquisition and transaction expenses of $237, (v) changes in fair value of non-hedge derivative instruments of $(7,963), and (vi) equity-based compensation of $1.
(2) Railroad:
  Includes the following items for the three months ended June 30, 2023: Transtar severance expense of $51.
(3) Railroad:
  Includes the following items for the three months ended June 30, 2023: (i) depreciation and amortization expense of $12, (ii) interest expense of $3, (iii) interest and other costs on pension and OPEB liabilities of $1 and (iv) asset impairment of $2.
  Jefferson Terminal:
  Includes the following items for the three months ended June 30, 2023: (i) equity-based compensation of $71, (ii) provision for income taxes of $35, (iii) interest expense of $1,844, (iv) depreciation and amortization expense of $2,808 and (v) acquisition and transaction expense of $8.
  Repauno:
  Includes the following items for the three months ended June 30, 2023: (i) equity-based compensation of $5, (ii) interest expense of $33 and (iii) depreciation and amortization expense of $124.

 


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