About HC2
HC2 Holdings, Inc. is a publicly traded (NYSE:HCHC) diversified holding company, which seeks opportunities to acquire and grow businesses that can generate long-term sustainable free cash flow and attractive returns in order to maximize value for all stakeholders. HC2 has a diverse array of operating subsidiaries across seven reportable segments, including Construction, Marine Services, Energy, Telecommunications, Life Sciences, Insurance and Other. HC2’s largest operating subsidiaries include DBM Global Inc., a family of companies providing fully integrated structural and steel construction services, and Global Marine Systems Limited, a leading provider of engineering and underwater services on submarine cables. Founded in 1994, HC2 is headquartered in New York, New York.
Latest News
HC2 Holdings Reports Second Quarter 2017 Results Posted 8/9/2017 4:16:49 PM

NEW YORK, Aug. 09, 2017 (GLOBE NEWSWIRE) -- HC2 Holdings, Inc. (“HC2”) (NYSE:HCHC), a diversified holding company, announced today its consolidated results for the second quarter 2017, which ended on June 30, 2017.

"During the second quarter, we continued the momentum with which we began the year," said Philip Falcone, HC2's Chairman, President and Chief Executive Officer.  "DBM Global maintained a healthy backlog, expects to remain on-track for a solid year, and is well-positioned to capitalize on several large opportunities ahead.  Global Marine also remained on track for a solid year, reflecting the strength of its joint venture with Huawei Marine and a high-level of fleet activity supporting maintenance zone agreements around the world, and/or installation, maintenance or repair contracts across the offshore power and telecom sectors.  American Natural Gas continues to expand its nationwide network of compressed natural gas fueling stations with the opening of new stations in Fayetteville, Tennessee, for which PepsiCo's Frito-Lay division will be a major customer, and in Liverpool, New York, to meet demand for high-performing, easily-accessible CNG fueling facilities for the Northeast region's heavy-duty and long-haul trucking fleets.  In addition, during the second quarter, two of our Pansend Life Sciences companies again achieved important strategic milestones with R2 Dermatology receiving FDA approval for the second generation R2 Dermal Cooling System, and BeneVir Biopharm, which is focused on developing oncolytic immunotherapies for the treatment of cancer, receiving a key patent that further strengthens its product development program."

Mr. Falcone, continued, “At the corporate level, we completed the transfer of our common stock listing to the prestigious New York Stock Exchange, continued to focus on further reducing the cumulative outstanding amount of our Preferred Stock, and, through a private placement, we issued $38.0 million aggregate principal amount of 11.000% Senior Secured Notes.  Near the end of the quarter, we further expanded our diverse platform of investments with the announcement of an agreement to acquire a majority interest in DTV America, a nationwide low power television distribution network, which we believe is poised to capitalize on a number of compelling opportunities.  Our solid second quarter and year-to-date results, significant portfolio company milestones, and the steps we've taken at the corporate level, should help us continue to drive performance and generate long-term shareholder value during the second half of the year and beyond."

Second Quarter & Year-To-Date Financial Highlights

  • Net Revenue: For the second quarter of 2017, HC2 recorded consolidated total net revenue of $378.7 million, as compared to $359.3 million for the year-ago quarter.  The $19.4 million or 5.4% year-over-year increase was driven primarily by growth in the Construction, Marine Services, Energy and Insurance segments.  For the first six months of 2017, HC2 recorded consolidated total net revenue of $769.2 million, as compared to $691.0 million for the 2016 comparable period, driven by increases in revenue across all reporting segments.
                   
  • Net Income / (Loss): For the second quarter of 2017, HC2 reported a Net (Loss) attributable to common and participating preferred stockholders of $(18.7) million or $(0.44) per fully diluted share, as compared to Income of $0.9 million or $0.02 per fully diluted share for the second quarter 2016.  For the first six months of 2017, HC2 reported a Net (Loss) attributable to common and participating preferred stockholders of $(33.8) million or $(0.80) per fully diluted share, as compared to a (Loss) of $(30.6) million or $(0.87) per fully diluted share in the 2016 comparable period.

  • Adjusted EBITDA: Adjusted EBITDA for “Core Operating Subsidiaries,” which includes HC2's Construction, Marine Services, Energy and Telecom segments, was a combined $17.9 million for the second quarter of 2017, as compared to $27.1 million for the year-ago quarter.  For the first six months of 2017, Adjusted EBITDA for "Core Operating Subsidiaries" was $45.7 million, as compared to $39.8 million for the 2016 comparable period, driven primarily by Marine Services, Telecom, and Energy segments.

    For the second quarter of 2017, Total Adjusted EBITDA (excluding the Insurance segment), which includes results from Core Operating Subsidiaries, Early-Stage and Other, and Non-operating Corporate segments, was $4.6 million, as compared to $15.2 million for the year-ago quarter.  For the first six months of 2017, Total Adjusted EBITDA (excluding the Insurance segment), was $21.3 million, as compared to $15.5 million for the 2016 comparable period, driven primarily by Marine Services, Telecom and Energy segments, as well as a net decrease in reported net losses associated with Other segment investments.
  • Balance Sheet: As of June 30, 2017, HC2 had consolidated cash, cash equivalents and investments of $1.7 billion, which includes cash and investments associated with HC2's Insurance segment.  Excluding the Insurance segment, consolidated cash was $104.6 million, of which $56.0 million was at the HC2 corporate level.

Second Quarter & Year-to-Date Segment Highlights

  • Construction - For the second quarter of 2017, HC2’s DBM Global, reported Net Income of $4.2 million, as compared to $9.4 million for the year-ago quarter.  For the six months of 2017, Net Income was $7.4 million, as compared to $13.7 million for the 2016 comparable period.  Adjusted EBITDA was $11.1 million for the second quarter, as compared to $13.2 million for the year-ago quarter, due in part to better-than-bid performance on commercial projects in the West region recognized in the year-ago quarter.  For the first six months of 2017, DBM Global's Adjusted EBITDA was $19.7 million, as compared to $24.7 million in the 2016 comparable period, due primarily to timing associated with design changes on certain existing projects in backlog and better-than bid performance on two large commercial projects in the second quarter 2016.

    Backlog at the end of the second quarter was $590 million, as compared to approximately $498 million in the prior-quarter and $344 million in the year-ago second quarter.  Taking into consideration awarded, but not yet signed contracts, backlog would have been over $800 millionDBM Global continues to see a number of large opportunities in the commercial sector totaling approximately $400 million in potential new projects that could be awarded over the next several quarters.  These projects include new sporting arenas or stadiums, as well as new healthcare facilities, commercial office buildings and convention centers.

  • Marine Services - For the second quarter of 2017, Global Marine reported a Net (Loss) of $(3.1) million, as compared to a Net Income of $6.0 million for the year-ago quarter.  For the first six months of 2017, Net Income was $8.1 million, as compared to $0.1 million for the 2016 comparable period.  Adjusted EBITDA was $3.6 million for the second quarter, as compared to $11.8 million for the year-ago quarter, due primarily to higher costs associated with two offshore power installation and repair projects in the second quarter of 2017, which Global Marine expects to partially recover in the second half of 2017, coupled with strong income associated with Global Marine's joint venture with Huawei Marine in the year-ago second quarter.  For the first six months of 2017, Global Marine's Adjusted EBITDA was $20.0 million, as compared to $12.3 million in the 2016 comparable period, due primarily to higher joint venture income from Huawei Marine.

  • Energy - For the second quarter of 2017, American Natural Gas (ANG) reported a Net (Loss) of $(0.4) million, as compared to a Net Income of $0.1 million for the year-ago quarter.  For the first six months of 2017, Net (Loss) was $(1.1) million, as compared to Net Income of $0.04 million for the 2016 comparable period.  Adjusted EBITDA was $1.0 million for the second quarter, as compared to $0.5 million for the year-ago quarter, driven primarily by an increase in the number of fueling stations owned and/or operated.   For the first six months of 2017, ANG's Adjusted EBITDA was $2.2 million, as compared to $0.9 million in the 2016 comparable period.  ANG continues to own and/or operate approximately 40 natural gas fueling stations, including stations under development, in 15 states and is focused on increasing volumes at existing stations while also expanding the geographic footprint through both internal / organic growth and strategic M&A transactions.

  • Telecommunications - For the second quarter of 2017, PTGi-ICS reported Net Income of $2.1 million, as compared to $1.0 million for the year-ago quarter.  For the first six months of 2017, Net Income was $3.6 million, as compared to $2.2 million for the 2016 comparable period.  Adjusted EBITDA was $2.2 million for the second quarter, as compared to $1.5 million for the year-ago quarter, driven primarily by continued focus on higher margin wholesale traffic mix and improved operational efficiencies and customer relationships across the platform.  For the first six months of 2017, PTGi-ICS's Adjusted EBITDA was $3.8 million, as compared to $1.8 million in the 2016 comparable period.

  • Insurance - As of June 30, 2017, Continental Insurance Group had approximately $69 million of statutory surplus, $79 million of total adjusted capital and $2.1 billion in total GAAP assets.

  • Pansend Life Sciences - Companies in the Pansend portfolio continued to achieve key strategic milestones during the second quarter, including R2 Dermatology, which received notification from the United States Food and Drug Administration of market clearance of R2 Dermatology's second generation device, the R2 Dermal Cooling System.  The R2 Dermal Cooling System is intended for use in dermatologic procedures for the removal of benign lesions of the skin, including skin lightening and skin evening.  Modifications to the initial R2 device were implemented to improve usability of the device, e.g., to reduce the steps required by the user for set up of the system and treatment, and to make it more commercially appealing.

    In addition, BeneVir Biopharm, Inc., a biotechnology company developing oncolytic immunotherapies for the treatment of cancer, announced during the second quarter that the U.S. Patent and Trademark Office had issued US Patent No. 9,623,059, entitled “Oncolytic Herpes Simplex Virus and Therapeutic Uses Thereof,” covering the composition of matter for Stealth-1H, BeneVir’s lead oncolytic immunotherapy, as well as other platform assets.  This patent further strengthens BeneVir’s product development program and protects its product platform through 2032.  BeneVir plans to bring Stealth-1H into the clinic next year and accelerate the pre-clinical development of its platform assets to help a diverse array of patients whose tumors do not respond to current therapeutic options, including immune checkpoint inhibitors.

  • HC2 Corporate - During the second quarter of 2017, the Company completed a private placement of $38.0 million aggregate principal amount of 11.000% Senior Secured Notes due 2019 (the "Notes") to investment funds affiliated with three institutional investors.  The Company expects to use the net proceeds from the issuance of the Notes for working capital for the Company and its subsidiaries, for general corporate purposes, as well as the financing of acquisitions and investments.  The Notes were issued at an issue price of 101.000%, plus accrued interest from June 1, 2017.

    In addition, the Company announced that a subsidiary of HC2 Holdings entered into a series of transactions that, if certain conditions are met and approval by the Federal Communications Commission is received, will result in HC2 and its subsidiaries owning over 50% of shares of common stock of DTV America Corporation ("DTVA").  DTVA is an aggregator and operator of low power television ("LPTV") licenses and stations across the United States.  DTVA currently owns and operates 52 LPTV stations in more than 40 U.S. cities.

    During the second quarter, the Company received approximately $11.5 million in dividends and tax share from DBM Global and PTGi-ICS, and further reduced the cumulative outstanding accreted value of the Company's Convertible Participating Preferred Stock to approximately $26.7 million from $30.0 million at the end of the first quarter 2017.  Since the end of September 2014, on a gross basis, the Company has reduced over $73 million in debt and pension liabilities at the subsidiary level.  Over the same period, the Company has reduced $28.5 million in Preferred Stock issued at the corporate level.

    Also during the second quarter, the Company completed the transfer of its common stock listing to the New York Stock Exchange from the NYSE MKT, effective May 16, 2017, remaining under the ticker symbol 'HCHC'. The transfer to one of the world's most prestigious stock exchanges marked a major milestone for the Company and aligned HC2 with some of the best companies and most influential brands in the world.

Conference Call

HC2 Holdings, Inc. will host a live conference call to discuss its second quarter 2017 financial results and operations today, Wednesday, August 9, 2017, at 5:00 p.m. ET.

Dial-in instructions for the conference call and the replay are as follows:

Live Call

Dial-In (Toll Free): 1-866-395-3893

International Dial-In: 1-678-509-7540

Participant Entry Number: 54309287

Alternatively, a live webcast of the conference call can be accessed by interested parties through the Investor Relations section of the HC2 Website, www.HC2.com.

Conference Replay*

Domestic Dial-In (Toll Free): 1-855-859-2056

International Dial-In: 1-404-537-3406

Conference Number: 54309287

*Available approximately two hours after the end of the conference call through September 8, 2017.

About HC2

HC2 Holdings, Inc. is a publicly traded (NYSE:HCHC) diversified holding company, which seeks opportunities to acquire and grow businesses that can generate long-term sustainable free cash flow and attractive returns in order to maximize value for all stakeholders.  HC2 has a diverse array of operating subsidiaries across seven reportable segments, including Construction, Marine Services, Energy, Telecommunications, Life Sciences, Insurance and Other.  HC2's largest operating subsidiaries include DBM Global Inc., a family of companies providing fully integrated structural and steel construction services, and Global Marine Systems Limited, a leading provider of engineering and underwater services on submarine cables. Founded in 1994, HC2 is headquartered in New York, New York.  Learn more about HC2 and its portfolio companies at www.hc2.com.

For information on HC2 Holdings, Inc., please contact Andrew G. Backman - Managing Director - Investor Relations & Public Relations - abackman@hc2.com - 212-339-5836.

Non-GAAP Financial Measures

In this release, HC2 refers to certain financial measures that are not presented in accordance with U.S. generally accepted accounting principles (“GAAP”), including Core Operating Subsidiary Adjusted EBITDA, Total Adjusted EBITDA (excluding the Insurance segment) and Adjusted EBITDA for its operating segments.  Management believes that Adjusted EBITDA measures provide investors with meaningful information for gaining an understanding of the Company’s results as it is frequently used by the financial community to provide insight into an organization’s operating trends and facilitates comparisons between peer companies, because interest, taxes, depreciation, amortization and the other items for which adjustments are made as noted in the definition of Adjusted EBITDA below can differ greatly between organizations as a result of differing capital structures and tax strategies. In addition, management uses Adjusted EBITDA measures in evaluating certain of the Company’s segments performance because they eliminate the effects of considerable amounts of non-cash depreciation and amortization and items not within the control of the Company’s operations managers. While management believes that these non-GAAP measurements are useful as supplemental information, such adjusted results are not intended to replace our GAAP financial results and should be read together with HC2’s results reported under GAAP.

Management defines Adjusted EBITDA as net income (loss) adjusted to exclude the impact of depreciation and amortization; amortization of equity method fair value adjustments at acquisition; (gain) loss on sale or disposal of assets; lease termination costs; asset impairment expense; loss on early extinguishment or restructuring of debt; interest expense; gain (loss) on contingent consideration; other income (expense), net; foreign currency transaction gain (loss) included in cost of revenue; income tax (benefit) expense; gain (loss) from discontinued operations; non-controlling interest; bonus to be settled in equity; share-based compensation expense and acquisition and non-recurring items. A reconciliation of Adjusted EBITDA to Net Income (Loss) is included in the financial tables at the end of this release.

Management recognizes that using Adjusted EBITDA as a performance measure has inherent limitations as an analytical tool as compared to net income (loss) or other GAAP financial measures, as these non-GAAP measures exclude certain items, including items that are recurring in nature, which may be meaningful to investors.

As a result of the exclusions, Adjusted EBITDA should not be considered in isolation and do not purport to be alternatives to net income (loss) or other GAAP financial measures as a measure of our operating performance.

Cautionary Statement Regarding Forward-Looking Statements

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This release contains, and certain oral statements made by our representatives from time to time may contain, forward-looking statements. Generally, forward-looking statements include information describing actions, events, results, strategies and expectations and are generally identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “plans,” “seeks,” “estimates,” “projects,” “may,” “will,” “could,” “might,” or “continues” or similar expressions. The forward-looking statements in this press release include without limitation statements regarding our expectation regarding building shareholder value.  Such statements are based on the beliefs and assumptions of HC2's management and the management of HC2's subsidiaries and portfolio companies. The Company believes these judgments are reasonable, but you should understand that these statements are not guarantees of performance or results, and the Company’s actual results could differ materially from those expressed or implied in the forward-looking statements due to a variety of important factors, both positive and negative, that may be revised or supplemented in subsequent reports on Forms 10-K, 10-Q and 8-K. Such important factors include, without limitation, issues related to the restatement of our financial statements; the fact that we have historically identified material weaknesses in our internal control over financial reporting, and any inability to remediate future material weaknesses; capital market conditions; the ability of HC2's subsidiaries and portfolio companies to generate sufficient net income and cash flows to make upstream cash distributions; volatility in the trading price of HC2 common stock; the ability of HC2 and its subsidiaries and portfolio companies to identify any suitable future acquisition opportunities; our ability to realize efficiencies, cost savings, income and margin improvements, growth, economies of scale and other anticipated benefits of strategic transactions; difficulties related to the integration of financial reporting of acquired or target businesses; difficulties completing pending and future acquisitions and dispositions; effects of litigation, indemnification claims, and other contingent liabilities; changes in regulations and tax laws; and risks that may affect the performance of the operating subsidiaries and portfolio companies of HC2. These risks and other important factors discussed under the caption “Risk Factors” in our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”), and our other reports filed with the SEC could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release.

You should not place undue reliance on forward-looking statements. All forward-looking statements attributable to HC2 or persons acting on its behalf are expressly qualified in their entirety by the foregoing cautionary statements. All such statements speak only as of the date made, and HC2 undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.


 
HC2 HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)
 
    Three Months Ended June 30,   Six Months Ended June 30,
    2017   2016   2017   2016
Services revenue   $ 196,970     $ 197,372     $ 432,898     $ 379,481  
Sales revenue   143,413     125,759     262,027     246,256  
Life, accident and health earned premiums, net   20,235     20,037     40,176     39,971  
Net investment income   16,939     13,707     32,243     27,786  
Net realized gains (losses) on investments   1,095     2,418     1,876     (2,457 )
Net revenue   378,652     359,293     769,220     691,037  
Operating expenses                
Cost of revenue - services   189,979     183,193     409,591     358,066  
Cost of revenue - sales   118,685     101,290     213,487     200,967  
Policy benefits, changes in reserves, and commissions   30,443     29,075     61,930     63,095  
Selling, general and administrative   41,707     34,994     81,563     70,591  
Depreciation and amortization   7,295     6,246     14,692     12,201  
Other operating (income) expenses   1,738     (1,499 )   (1,820 )   (612 )
Total operating expenses   389,847     353,299     779,443     704,308  
   Income (loss) from operations   (11,195 )   5,994     (10,223 )   (13,271 )
Interest expense   (12,073 )   (10,569 )   (26,188 )   (20,895 )
Gain (loss) on contingent consideration   (88 )   192     (319 )   192  
Income from equity investees   4,003     6,394     11,696     2,818  
Other (expense), net   (3,105 )   (496 )   (8,015 )   (1,210 )
Income (loss) from continuing operations before income taxes   (22,458 )   1,515     (33,049 )   (32,366 )
Income tax (expense) benefit   1,985     (224 )   (3,306 )   2,315  
Net income (loss)   (20,473 )   1,291     (36,355 )   (30,051 )
Less: Net loss attributable to noncontrolling interest and redeemable noncontrolling interest   2,562     644     3,948     1,524  
Net income (loss) attributable to HC2 Holdings, Inc.   (17,911 )   1,935     (32,407 )   (28,527 )
Less: Preferred stock and deemed dividends from conversions   793     1,044     1,376     2,113  
Net income (loss) attributable to common stock and participating preferred stockholders   $ (18,704 )   $ 891     $ (33,783 )   $ (30,640 )
                 
Income (loss) per Common Share                
Basic   $ (0.44 )   $ 0.02     $ (0.80 )   $ (0.87 )
Diluted   $ (0.44 )   $ 0.02     $ (0.80 )   $ (0.87 )
                 
Weighted average common shares outstanding:                
Basic   42,691     35,518     42,322     35,391  
Diluted   42,691     35,643     42,322     35,391  


 
HC2 HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
(Unaudited)
 
    June 30,   December 31,
    2017   2016
Assets        
Investments:        
Fixed maturities, available-for-sale at fair value   $ 1,334,876     $ 1,278,958  
Equity securities, available-for-sale at fair value   47,810     51,519  
Mortgage loans   21,135     16,831  
Policy loans   18,107     18,247  
Other invested assets   91,381     62,363  
    Total investments   1,513,309     1,427,918  
Cash and cash equivalents   143,130     115,371  
Accounts receivable, net   250,460     267,598  
Recoverable from reinsurers   527,796     524,201  
Deferred tax asset   430     1,108  
Property, plant and equipment, net   282,691     286,458  
Goodwill   97,499     98,086  
Intangibles, net   37,179     39,722  
Other assets   88,816     74,814  
Total assets   $ 2,941,310     $ 2,835,276  
         
Liabilities, temporary equity and stockholders’ equity        
Life, accident and health reserves   $ 1,682,160     $ 1,648,565  
Annuity reserves   247,684     251,270  
Value of business acquired   45,385     47,613  
Accounts payable and other current liabilities   258,094     251,733  
Deferred tax liability   15,487     15,304  
Long-term obligations   494,723     428,496  
Other liabilities   97,988     92,871  
Total liabilities   2,841,521     2,735,852  
Commitments and contingencies        
Temporary equity:        
Preferred stock   26,266     29,459  
Redeemable noncontrolling interest   2,373     2,526  
Total temporary equity   28,639     31,985  
Stockholders’ equity        
Common stock, $.001 par value;   43     42  
Shares authorized: 80,000,000 at June 30, 2017 and December 31, 2016;        
Shares issued: 43,365,646 and 42,070,675 at June 30, 2017 and December 31, 2016;        
Shares outstanding: 43,001,167 and 41,811,288 at June 30, 2017 and December 31, 2016, respectively        
Additional paid-in capital   247,167     241,485  
Treasury stock, at cost;  364,479 and 259,387 shares at June 30, 2017 and December 31, 2016, respectively   (1,969 )   (1,387 )
Accumulated deficit   (206,685 )   (174,278 )
Accumulated other comprehensive income (loss)   12,678     (21,647 )
Total HC2 Holdings, Inc. stockholders’ equity   51,234     44,215  
Noncontrolling interest   19,916     23,224  
Total stockholders’ equity   71,150     67,439  
Total liabilities, temporary equity and stockholders’ equity   $ 2,941,310     $ 2,835,276  


 
HC2 HOLDINGS, INC.
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA
(in thousands)
(Unaudited)
 
    Three Months Ended June 30, 2017
    Core Operating Subsidiaries   Early Stage & Other            
    Construction   Marine
Services
  Energy   Telecom   Life
Sciences
  Other and
Eliminations
  Non-
operating
Corporate
  HC2
Net (loss) attributable to HC2 Holdings, Inc.                               $ (17,911 )
Less: Net Income attributable to HC2 Holdings Insurance Segment                               164  
Net Income (loss) attributable to HC2 Holdings, Inc., excluding Insurance Segment   $ 4,179     $ (3,053 )   $ (365 )   $ 2,060     $ (4,106 )   $ (3,757 )   $ (13,033 )   $ (18,075 )
Adjustments to reconcile net income (loss) to Adjusted EBITDA:                                
Depreciation and amortization   1,240     5,255     1,381     94     41     331     16     8,358  
Depreciation and amortization (included in cost of revenue)   1,302                             1,302  
Amortization of equity method fair value adjustment at acquisition       (325 )                       (325 )
Asset impairment expense                       1,810         1,810  
(Gain) loss on sale or disposal of assets   (145 )       18                     (127 )
Lease termination costs       55                         55  
Interest expense   174     1,040     154     14         16     10,675     12,073  
Net loss on contingent consideration                           88     88  
Other (income) expense, net   28     490     255     (9 )   (11 )   803     214     1,770  
Foreign currency (gain) loss (included in cost of revenue)       83                         83  
Income tax (benefit) expense   3,232     (134 )   (1 )               (6,543 )   (3,446 )
Noncontrolling interest   369     (156 )   (492 )       (911 )   (1,372 )       (2,562 )
Bonus to be settled in equity                           585     585  
Share-based payment expense       394     91         76     18     527     1,106  
Acquisition and nonrecurring items   701                         1,168     1,869  
Adjusted EBITDA   $ 11,080     $ 3,649     $ 1,041     $ 2,159     $ (4,911 )   $ (2,151 )   $ (6,303 )   $ 4,564  
                                 
Total Core Operating Subsidiaries   $ 17,929                              


 
HC2 HOLDINGS, INC.
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA
(in thousands)
(Unaudited)
 
    Three Months Ended June 30, 2016
    Core Operating Subsidiaries   Early Stage & Other            
    Construction   Marine
Services
  Energy   Telecom   Life
Sciences
  Other and
Eliminations
  Non-
operating
Corporate
  HC2
Net Income attributable to HC2 Holdings, Inc.                               $ 1,935  
Less: Net (loss) attributable to HC2 Holdings Insurance Segment                               (2,293 )
Net Income (loss) attributable to HC2 Holdings, Inc., excluding Insurance Segment   $ 9,364     $ 6,002     $ 68     $ 1,009     $ (2,004 )   $ (2,608 )   $ (7,603 )   $ 4,228  
Adjustments to reconcile net income (loss) to Adjusted EBITDA:                                
Depreciation and amortization   303     6,084     468     140     36     336         7,367  
Depreciation and amortization (included in cost of revenue)   (206 )                           (206 )
Amortization of equity method fair value adjustment at acquisition       (359 )                       (359 )
(Gain) loss on sale or disposal of assets   (1,845 )   7                 1         (1,837 )
Lease termination costs               338                 338  
Interest expense   303     1,285     14             1     8,966     10,569  
Net gain on contingent consideration       (192 )                       (192 )
Other (income) expense, net   (32 )   403     (344 )   29         (10 )   465     511  
Foreign currency (gain) loss (included in cost of revenue)       (1,540 )                       (1,540 )
Income tax (benefit) expense   4,524     (212 )               1     (9,404 )   (5,091 )
Noncontrolling interest   768     200     244         (812 )   (1,044 )       (644 )
Share-based payment expense       152     90         34     40     1,359     1,675  
Acquisition and nonrecurring items               18             313     331  
Adjusted EBITDA   $ 13,179     $ 11,830     $ 540     $ 1,534     $ (2,746 )   $ (3,283 )   $ (5,904 )   $ 15,150  
                                 
Total Core Operating Subsidiaries   $ 27,083                              


 
HC2 HOLDINGS, INC.
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA
(in thousands)
(Unaudited)
 
    Six Months Ended June 30, 2017
    Core Operating Subsidiaries   Early Stage & Other            
    Construction   Marine
Services
  Energy   Telecom   Life
Sciences
  Other and
Eliminations 
  Non-
operating
Corporate
  HC2
Net (loss) attributable to HC2 Holdings, Inc.                               $ (32,407 )
Less: Net (loss) attributable to HC2 Holdings Insurance Segment                               (597 )
Net Income (loss) attributable to HC2 Holdings, Inc., excluding Insurance Segment   $ 7,382     $ 8,099     $ (1,062 )   $ 3,562     $ (7,516 )   $ (9,187 )   $ (33,088 )   $ (31,810 )
Adjustments to reconcile net income (loss) to Adjusted EBITDA:                                
Depreciation and amortization   2,880     10,340     2,629     191     79     661     33     16,813  
Depreciation and amortization (included in cost of revenue)   2,542                             2,542  
Amortization of equity method fair value adjustment at acquisition       (650 )                       (650 )
Asset impairment expense                       1,810         1,810  
(Gain) loss on sale or disposal of assets   (393 )   (3,500 )   14                     (3,879 )
Lease termination costs       249                         249  
Interest expense   381     2,342     290     23         2,407     20,745     26,188  
Net loss on contingent consideration                           319     319  
Other (income) expense, net   7     1,555     1,375     65     (15 )   2,918     258     6,163  
Foreign currency (gain) loss (included in cost of revenue)       107                         107  
Income tax (benefit) expense   5,311     376     12                 (4,366 )   1,333  
Noncontrolling interest   632     338     (1,239 )       (1,702 )   (1,977 )       (3,948 )
Bonus to be settled in equity                           585     585  
Share-based payment expense       739     182         168     47     1,489     2,625  
Acquisition and nonrecurring items   946                         1,861     2,807  
Adjusted EBITDA   $ 19,688     $ 19,995     $ 2,201     $ 3,841     $ (8,986 )   $ (3,321 )   $ (12,164 )   $ 21,254  
                                 
Total Core Operating Subsidiaries   $ 45,725                              


 
HC2 HOLDINGS, INC.
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA
(in thousands)
(Unaudited)
 
    Six Months Ended June 30, 2016
    Core Operating Subsidiaries   Early Stage & Other            
    Construction   Marine
Services
  Energy   Telecom   Life
Sciences
  Other and
Eliminations
  Non-
operating
Corporate
  HC2  
Net (loss) attributable to HC2 Holdings, Inc.                               $ (28,527 )
Less: Net (loss) attributable to HC2 Holdings Insurance Segment                               (9,789 )
Net Income (loss) attributable to HC2 Holdings, Inc., excluding Insurance Segment   $ 13,748     $ 84     $ 41     $ 2,211     $ (706 )   $ (13,104 )   $ (21,012 )   $ (18,738 )
Adjustments to reconcile net income (loss) to Adjusted EBITDA:                                
Depreciation and amortization   832     11,239     897     246     55     672         13,941  
Depreciation and amortization (included in cost of revenue)   1,727                             1,727  
Amortization of equity method fair value adjustment at acquisition       (717 )                       (717 )
(Gain) loss on sale or disposal of assets   (941 )   (10 )               1         (950 )
Lease termination costs               338                 338  
Interest expense   613     2,355     23             1     17,903     20,895  
Net gain on contingent consideration       (192 )                       (192 )
Other (income) expense, net   (76 )   1,015     (375 )   (996 )   (3,221 )   5,996     (1,146 )   1,197  
Foreign currency (gain) loss (included in cost of revenue)       (1,687 )                       (1,687 )
Income tax (benefit) expense   7,969     (852 )                   (13,630 )   (6,513 )
Noncontrolling interest   829     45     222         (1,532 )   (1,088 )       (1,524 )
Share-based payment expense       761     104         56     200     3,745     4,866  
Acquisition and nonrecurring items       266     27     18             2,514     2,825  
Adjusted EBITDA   $ 24,701     $ 12,307     $ 939     $ 1,817     $ (5,348 )   $ (7,322 )   $ (11,626 )   $ 15,468  
                                 
Total Core Operating Subsidiaries   $ 39,764                              

 

Primary Logo

HC2 Holdings, Inc.

Read More
HC2 Holdings Sets Second Quarter 2017 Earnings Release Date and Webcast Posted 7/26/2017 8:50:38 PM

NEW YORK, July 26, 2017 (GLOBE NEWSWIRE) -- HC2 Holdings, Inc. (NYSE:HCHC), a diversified holding company, announced today that it will release its financial results for the second quarter 2017 on Wednesday, August 9, 2017 after the market closes.

The Company will host an earnings conference call reviewing these results and its operations the same day, beginning at 5:00 p.m. ET.  Participating on the call will be Philip Falcone, the Company’s Chairman, President and CEO, Michael J. Sena, Chief Financial Officer and Andrew G. Backman, Managing Director of Investor Relations and Public Relations.

Dial-in instructions for the conference call and the replay are outlined below.  This conference call will also be broadcast live over the Internet and can be accessed by all interested parties through HC2’s website, www.hc2.com in the "Investor Relations" section.  To listen to the live call, please go to the "Investor Relations" section of the Company's website at least 15 minutes prior to the start of the call to register and download any necessary audio software.  For those who are not able to listen to the live broadcast, a replay will be available shortly after the call on the HC2 website.

Conference Call Details

Live Call
Dial-In (Toll Free): 1-866-395-3893
International Dial-In: 1-678-509-7540
Participant Entry Number: 54309287

Conference Replay*
Domestic Dial-In (Toll Free): 1-855-859-2056
International Dial-In: 1-404-537-3406
Conference Number: 54309287

*Available approximately two hours after the end of the conference call through September 8, 2017.

About HC2

HC2 Holdings, Inc. is a publicly traded (NYSE:HCHC) diversified holding company, which seeks opportunities to acquire and grow businesses that can generate long-term sustainable free cash flow and attractive returns in order to maximize value for all stakeholders.  HC2 has a diverse array of operating subsidiaries across seven reportable segments, including Construction, Marine Services, Energy, Telecommunications, Life Sciences, Insurance and Other.  HC2's largest operating subsidiaries include DBM Global Inc., a family of companies providing fully integrated structural and steel construction services, and Global Marine Systems Limited, a leading provider of engineering and underwater services on submarine cables. Founded in 1994, HC2 is headquartered in New York, New York.  Learn more about HC2 and its portfolio companies at www.hc2.com.

Cautionary Statement Regarding Forward Looking Statements

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: This release contains, and certain oral statements made by our representatives from time to time may contain, forward-looking statements, including statements regarding the commencement or completion of the offering. Generally, forward-looking statements include information describing the offering and other actions, events, results, strategies and expectations and are generally identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “plans,” “seeks,” “estimates,” “projects,” “may,” “will,” “could,” “might,” or “continues” or similar expressions. The forward-looking statements in this press release include, without limitation, statements regarding our expectation regarding building shareholder value.  Such statements are based on the beliefs and assumptions of HC2’s management and the management of HC2’s subsidiaries and portfolio companies. The Company believes these judgments are reasonable, but you should understand that these statements are not guarantees of performance or results, and the Company’s actual results could differ materially from those expressed or implied in the forward-looking statements due to a variety of important factors, both positive and negative, that may be revised or supplemented in subsequent reports on Forms 10-K, 10-Q and 8-K. Such important factors include, without limitation, the ability of our subsidiaries (including, target businesses following their acquisition) to generate sufficient net income and cash flows to make upstream cash distributions, capital market conditions, our and our subsidiaries’ ability to identify any suitable future acquisition opportunities, efficiencies/cost avoidance, cost savings, income and margins, growth, economies of scale, combined operations, future economic performance, conditions to, and the timetable for, completing the integration of financial reporting of acquired or target businesses with HC2 or the applicable subsidiary of HC2, completing future acquisitions and dispositions, litigation, potential and contingent liabilities, management’s plans, changes in regulations and taxes.

These risks and other important factors discussed under the caption “Risk Factors” in our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”), and our other reports filed with the SEC could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release.

You should not place undue reliance on forward-looking statements. All forward-looking statements attributable to HC2 or persons acting on its behalf are expressly qualified in their entirety by the foregoing cautionary statements. All such statements speak only as of the date made, and HC2 undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

For information on HC2 Holdings, Inc., please contact:

Andrew G. Backman
Managing Director
Investor Relations & Public Relations
abackman@hc2.com
212-339-5836

Primary Logo

HC2 Holdings, Inc.

Read More