MRC Global Earnings: Everything You Must Know Now

MRC Global Inc. (NYSE:MRC) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.

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MRC Global Inc. Earnings Cheat Sheet

Revenue: Decreased 5.61% to $1.31 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: MRC Global Inc. reported adjusted EPS income of $0.45 per share. By that measure, the company beat the mean analyst estimate of $0.43. It missed the average revenue estimate of $1.34 billion.

Quoting Management: Andrew R. Lane, MRC’s chairman, president and chief executive officer, stated, “The industry-wide slowdown we saw in the fourth quarter continued into the first two months of this year, particularly in the upstream and midstream sectors, resulting in lower revenues as compared to our strong first quarter a year ago. However, our gross profit improved over the same period a year ago as we continued to rebalance our product mix away from the OCTG business. We also realized substantial interest expense savings due to the refinancing steps we took in the fourth quarter of 2012. As a result, we generated net income growth of 23% in the quarter. Our strategy to focus on our higher margin product lines and reduce exposure to our OCTG business has proven timely given the sluggish drilling rig activity in the U.S.”

Key Stats (on next page)…

Revenue decreased 0.13% from $1.31 billion in the previous quarter. EPS decreased 18.18% from $0.55 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.60 to a profit $0.57. For the current year, the average estimate has moved down from a profit of $2.49 to a profit of $2.30 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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