In This Article:
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Revenue: Q4 revenue of $943.6 million, a 4% decrease year-over-year.
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Net Income: Q4 net income attributable to ChampionX increased by 14% year-over-year to $77.2 million.
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Adjusted EBITDA: Q4 adjusted EBITDA rose 10% year-over-year to $198.1 million.
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Free Cash Flow: Q4 free cash flow was $139.8 million, with full-year free cash flow reaching $412.5 million.
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Share Repurchases and Dividend: $118 million of common stock repurchased in Q4; quarterly dividend increased by 12% to $0.095 per share.
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Outlook: Positive growth expected in 2024 with revenue and adjusted EBITDA margin improvements.
On February 5, 2024, ChampionX Corp (NASDAQ:CHX) released its 8-K filing, detailing its financial performance for the fourth quarter and full year of 2023. ChampionX, a global leader in chemical solutions and equipment for oil and gas production, reported a slight sequential increase in revenue for the fourth quarter, although there was a 4% decline compared to the previous year. Despite the revenue dip, the company saw a significant increase in net income and adjusted EBITDA, highlighting its ability to maintain profitability amid market challenges.
Financial Performance and Challenges
ChampionX's fourth-quarter revenue stood at $943.6 million, with a net income attributable to the company of $77.2 million, marking a 14% increase from the same period last year. Adjusted EBITDA for the quarter was $198.1 million, a 10% year-over-year increase. The company's performance demonstrates resilience in a challenging environment, characterized by international revenue growth driven by seasonal strength in the Production Chemical Technologies business. However, the overall revenue decline reflects the cyclical nature of the oil and gas industry and the impact of global economic factors on demand.
Financial Achievements and Industry Significance
The company's financial achievements, particularly the 103% year-over-year increase in full-year net income to $314.2 million and a 25% increase in full-year adjusted EBITDA to $771.2 million, underscore its operational efficiency and the effectiveness of its strategic initiatives. These results are significant for ChampionX and the broader oil and gas industry as they demonstrate the company's ability to generate strong earnings and cash flow, which are crucial for sustaining operations and funding future growth.
Key Financial Metrics
ChampionX's balance sheet remains robust, with year-end liquidity of $959 million, including $289 million in cash and approximately $670 million in available credit facility capacity. The company's cash flow from operating activities was $540.3 million for the full year, with free cash flow reaching $412.5 million. These metrics are vital as they reflect the company's ability to generate cash to fund operations, invest in growth, and return capital to shareholders.