Top-line Growth of 2.8% for the first six months of 2022, with Aerospace & Defense revenue up 28.4%
Quarterly interest expense reduction of $1.0 million or 32.9%
Ongoing deleveraging, with $8.1 million of quarterly debt repayments, and total debt reduced to $200.4 million
New Growth Initiatives - OneSuite™ (Data Solutions), Sensoria™ (Wind) and Private Space capabilities remain on a strong growth trajectory   

PRINCETON JUNCTION, N.J., Aug. 03, 2022 (GLOBE NEWSWIRE) -- MISTRAS Group, Inc. (MG: NYSE), a leading "one source" multinational provider of integrated technology-enabled asset protection solutions, reported financial results for its second quarter and six months ended June 30, 2022.

Highlights of the Second Quarter 2022*

  • Revenue of $179.0 million, up 0.8%, up 3.2% excluding the impact of unfavorable foreign currency exchange**
  • SG&A expenses of $40.7 million, up 2.4% but down 3.2% sequentially
  • Net income of $4.6 million or $0.15 per diluted share
  • Adjusted EBITDA of $18.3 million
  • Operating cash flow of $13.2 million and free cash flow of $9.3 million

Highlights of the First Half 2022

  • Revenue of $340.7 million, up 2.8%, up 4.6% excluding the impact of unfavorable foreign currency exchange**
  • Income from operations of $4.9 million
  • Interest expense of $4.1 million, down 36.3%
  • Gross debt of $200.4 million and Net debt of $181.8 million

*    All comparisons are consolidated and versus the equivalent prior year period, unless otherwise noted.
** We calculate foreign currency exchange impact by converting our current period financial results in local currency using the prior period exchange rates and comparing this amount to the current period financial results in local currency using the current period exchange rate.

For the second quarter of 2022, consolidated revenue was $179.0 million, a 0.8% nominal increase, but up 3.2% excluding the impact of unfavorable foreign currency exchange. Second quarter revenue was impacted by project delays in the Company’s oil & gas business, as customers continue to defer projects, associated with high refinery utilization rates due to strong consumer demand. Projects that normally occur in the second quarter are now anticipated to be performed in the third and fourth quarters. This is evident in our Services segment which we expect to approach 2019 revenue levels in the third quarter, driven by the completion of turnarounds and other projects previously scheduled for the first and second quarters of the year.

Second quarter 2022 consolidated gross profit was down slightly compared to the prior year period, with a gross profit margin decline of 120 basis points. This decline was primarily due to higher healthcare costs, the lag in price increases in response to inflationary cost increases and the end of Canadian wage subsidies that were available during the COVID-19 pandemic and are no longer being provided. These adverse factors more than offset the positive impact of a favorable sales mix. The Company anticipates improved gross margin in the second half of 2022, due to increased volumes, a favorable sales mix and reducing the impact of inflationary pressures on gross margin.

Selling, general and administrative expenses in the second quarter of 2022 were $40.7 million, up from $39.7 million in the second quarter of 2021, primarily due to the reversal of remaining COVID-19 temporary cost reductions in August of 2021, which were initially implemented in 2020. However, selling, general and administrative expenses were down 3.2% sequentially from the first quarter of 2022 and remain below second quarter 2019 pre-pandemic levels.

For the second quarter of 2022, the Company reported net income of $4.6 million or $0.15 per diluted share.

Chief Executive Officer Dennis Bertolotti commented, “This was our eighth consecutive quarter of revenue growth despite delays in the timing of some oil & gas projects and unfavorable foreign exchange translation. Most of these delays are expected to shift revenue that had been anticipated to be earned in the second quarter, into the third and fourth quarters, effectively reversing our historically seasonal second and third quarter performance and, ultimately, having little effect on our full year expectations.”

“We continue to see strengthening market conditions in the Aerospace and Defense industry which continued in the second quarter, as our revenue in this end market was the highest it has been since the onset of the pandemic. We are seeing significant increases in the commercial aerospace sector which we anticipate will continue to gain momentum through the remainder of the year. The expansion and installation of new equipment and capabilities at our Georgia Aerospace facility is nearly complete, wherein we are expanding our service offerings that help alleviate our customers’ bottlenecks that have arisen during the pandemic and continue to exist in the aerospace supply chains. We are also optimistic for the continuing prospects of the growing private space sector. Additionally, I am very pleased to have Hon. Jay M. Cohen engaged with MISTRAS as an Advanced Technical Solutions Consultant. Retired Rear Admiral Cohen brings an exceptional reputation and over four decades of expertise in science and technology research, and his knowledge and network of industry contacts will enable us to further expand into a robust naval and defense infrastructure sector.”

“We continue to see expansion in our growth initiatives as Onstream, our inline inspection business within the midstream sector, reported its highest ever revenue quarter. We expect to continue to see this trend continuing into the second half of 2022, due to increased production levels and the corresponding transportation and distribution activity, due to high crude oil prices. Our data solutions businesses, including PCMS and New Century Software, also had strong quarters as well. The adoption of OneSuite continues to increase, with over 90 integrated applications having been installed at nearly 40 different customers. This continues to prove to us, and our customers, the versatility and capabilities of OneSuite as it is currently operating at over 150 sites with close to 900 individual subscriptions. OneSuite revenue remains on track to double this year.”

Mr. Bertolotti concluded, “I am looking forward to the second half of 2022, during which the third quarter could be one of our strongest Services segment revenue quarters ever, due in part to the continued rapid growth of our digital solutions service offerings including OneSuite, and the continued recovery and growth of our other end markets as we continue to meet and exceed customer needs. Inflation remains an ongoing challenge, but we are making progress as we actively engage with our customers, and they begin to acknowledge the inevitable cost of an inflationary environment. Our continued focus on improving cost leverage and recovery in markets with higher than corporate average margins has positioned us to have robust consolidated profitability for the remainder of the year. With our recently announced new credit facility, we will enjoy the flexibility to increase our investment in both organic growth initiatives and more closely evaluate acquisitions that meet our strategic objectives. I am very excited about our prospects for growth in both our existing and new markets in 2022 and beyond.”   

Performance by certain Segments:

Services segment second quarter revenue was $149.5 million, up 3.1% from $145.0 million in the prior year quarter. Revenues continue to reflect recovery in the Energy markets. For the second quarter, gross profit was $43.0 million, compared to $43.8 million in the prior year. Gross profit margin was 28.7% for the second quarter of 2022, compared to 30.2% in the second quarter of 2021. This decrease of 150 basis points was due primarily to higher healthcare costs in the US and the end of Canadian wage subsidies that were available during the COVID-19 pandemic and are no longer being provided, partially offset by favorable sales mix.

International segment second quarter revenues were $29.6 million, down 7.3% from $32.0 million in the prior year quarter but up 3.7% in local currencies before translation, which represents organic growth, due to increased opportunities in a recovering aerospace market, increased nuclear business, and large projects in the Energy markets. International segment second quarter gross profit margin was 31.9%, compared to 30.1% in the prior year, a 180-basis point improvement attributable to favorable sales mix.

Cash Flow and Balance Sheet
The Company’s net cash from operating activities was $7.8 million for the first six months of 2022, compared to $18.1 million in the prior year. Free cash flow was $0.7 million for the first six months of 2022, compared to $7.3 million in the prior year.
For the second quarter of 2022, free cash flow was $9.3 million compared to $8.5 million in the prior year period, an increase of 9.4%.

The Company’s net debt (total debt less cash and cash equivalents) was $181.8 million as of June 30, 2022, compared to $178.5 million as of December 31, 2021. Gross debt decreased by $8.4 million during the quarter ended June 30, 2022, from $208.8 million as of March 31, 2022, to $200.4 million as of June 30, 2022.

Outlook
The Company reaffirms its previously announced outlook for the full year 2022, that being revenue between $695 and $715 million, Adjusted EBITDA between $65 and $69 million and free cash flow between $27 and $30 million. While the second quarter 2022 results were below the Company’s expectations, it is confident in the level of work expected for the second half of 2022, given strong energy markets, improving commercial aerospace demand, robust industrial manufacturing and a rapidly developing Data Solutions offering.

Conference Call
In connection with this release MISTRAS will hold a conference call on August 4, 2022, at 10:00 a.m. (Eastern). To listen to the live webcast of the conference call, visit the Investor Relations section of MISTRAS Group’s website at www.mistrasgroup.com.

Note there is a new process to participate in the live question and answer session. Individuals wishing to participate may preregister at: https://register.vevent.com/register/BI61289ae154d54459b1036db29c908b0d. Upon registering, a dial-in number and unique PIN will be provided to join the conference call.

Following the conference call, an archived webcast of the call will be available for one year by visiting the Investor Relations section of MISTRAS Group’s website.

About MISTRAS Group, Inc. - One Source for Asset Protection Solutions®
MISTRAS Group, Inc. (NYSE: MG) is a leading "one source" multinational provider of integrated technology-enabled asset protection solutions, helping to maximize the safety and operational uptime for civilization’s most critical industrial and civil assets.

Backed by an innovative, data-driven asset protection portfolio, proprietary technologies, and decades-long legacy of industry leadership, MISTRAS leads clients in the oil and gas, aerospace and defense, power generation, civil infrastructure, and manufacturing industries towards achieving and maintaining operational excellence. By supporting these organizations that help fuel our vehicles and power our society; inspecting components that are trusted for commercial, defense, and space craft; and building real-time monitoring equipment to enable safe travel across bridges, MISTRAS helps the world at large.

MISTRAS enhances value for its clients by integrating asset protection throughout supply chains and centralizing integrity data through a suite of Industrial IoT-connected digital software and monitoring solutions. The company’s core capabilities also include non-destructive testing (“NDT”) field inspections enhanced by advanced robotics, laboratory quality control and assurance testing, sensing technologies and NDT equipment, asset and mechanical integrity engineering services, and light mechanical maintenance and access services.

For more information about how MISTRAS helps protect civilization’s critical infrastructure, visit www.mistrasgroup.com or contact Nestor S. Makarigakis, Group Vice President of Marketing at marcom@mistrasgroup.com.

Forward-Looking and Cautionary Statements
Certain statements made in this press release are "forward-looking statements" about MISTRAS' financial results and estimates, products and services, business model, strategy, growth opportunities, profitability and competitive position, and other matters. These forward-looking statements generally use words such as "future," "possible," "potential," "targeted," "anticipate," "believe," "estimate," "expect," "intend," "plan," "predict," "project," "will," "may," "should," "could," "would" and other similar words and phrases. Such statements are not guarantees of future performance or results, and will not necessarily be accurate indications of the times at, or by which, such performance or results will be achieved, if at all. These statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in these statements. A list, description and discussion of these and other risks and uncertainties can be found in the "Risk Factors" section of the Company's 2021 Annual Report on Form 10-K dated March 14, 2022, as updated by our reports on Form 10-Q and Form 8-K. The forward-looking statements are made as of the date hereof, and MISTRAS undertakes no obligation to update such statements as a result of new information, future events or otherwise.

Use of Non-GAAP Measures
In addition to financial information prepared in accordance with generally accepted accounting principles in the U.S. (GAAP), this press release also contains adjusted financial measures that we believe provide investors and management with supplemental information relating to operating performance and trends that facilitate comparisons between periods and with respect to projected information. The term "Adjusted EBITDA" used in this release is a financial measurement not calculated in accordance with GAAP and is defined as net income attributable to MISTRAS Group, Inc. plus: interest expense, provision for income taxes, depreciation and amortization, share-based compensation expense and certain acquisition related costs (including transaction due diligence costs and adjustments to the fair value of contingent consideration), foreign exchange (gain) loss, non-cash impairment charges and, if applicable, certain additional special items which are noted. A reconciliation of Adjusted EBITDA to a financial measurement under GAAP is set forth in a table attached to this press release. The Company also uses the term “net debt”, a non-GAAP measurement defined as the sum of the current and long-term portions of long-term debt, less cash and cash equivalents and the term “free cash flow”, a non-GAAP measurement the Company defines as cash provided by operating activities less capital expenditures (which is classified as an investing activity). A reconciliation of these non-GAAP financial measurement to GAAP are also set forth in tables attached to this press release. In the tables attached is also a table reconciling “Segment and Total Company Income (Loss) from operations (GAAP) to Income (Loss) before special items (non-GAAP), “Net Income (Loss) (GAAP)" to "Net Income (Loss) Excluding Special Items (non-GAAP)”, and “Diluted EPS (GAAP)” to “Diluted EPS Excluding Special Items (non-GAAP)” which reconciles the non-GAAP amount to a GAAP measurement.

Mistras Group, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)

 June 30, 2022 December 31, 2021
ASSETS(unaudited)  
Current Assets   
Cash and cash equivalents$18,609  $24,110 
Accounts receivable, net 129,572   109,511 
Inventories 12,967   12,686 
Prepaid expenses and other current assets 11,768   15,031 
Total current assets 172,916   161,338 
Property, plant and equipment, net 80,585   86,578 
Intangible assets, net 54,278   59,381 
Goodwill 203,106   205,439 
Deferred income taxes 1,232   2,174 
Other assets 43,425   47,285 
Total assets$555,542  $562,195 
LIABILITIES AND EQUITY   
Current Liabilities   
Accounts payable$17,328  $12,870 
Accrued expenses and other current liabilities 84,835   83,863 
Current portion of long-term debt 21,227   20,162 
Current portion of finance lease obligations 3,844   3,765 
Income taxes payable 148   755 
Total current liabilities 127,382   121,415 
Long-term debt, net of current portion 179,162   182,403 
Obligations under finance leases, net of current portion 9,444   9,752 
Deferred income taxes 8,566   8,385 
Other long-term liabilities 36,727   39,328 
Total liabilities 361,281   361,283 
Equity   
Preferred stock, 10,000,000 shares authorized —   — 
Common stock, $0.01 par value, 200,000,000 shares authorized, 29,807,038 and 29,546,263 shares issued and outstanding 297   295 
Additional paid-in capital 240,697   238,687 
Accumulated deficit (18,708)  (17,988)
Accumulated other comprehensive loss (28,287)  (20,311)
Total Mistras Group, Inc. stockholders’ equity 193,999   200,683 
Non-controlling interests 262   229 
Total equity 194,261   200,912 
Total liabilities and equity$555,542  $562,195 


Mistras Group, Inc. and Subsidiaries
Unaudited Condensed Consolidated Statements of Income (Loss)
(in thousands, except per share data)

 Three Months Ended June 30, Six Months Ended June 30,
  2022   2021  2022   2021 
        
Revenue$179,031  $177,677 $340,693  $331,412 
Cost of revenue 119,980   116,787  235,738   225,030 
Depreciation 5,493   5,554  11,505   11,045 
Gross profit 53,558   55,336  93,450   95,337 
Selling, general and administrative expenses 40,676   39,719  82,712   79,358 
Bad debt provision for troubled customers, net of recoveries 289   —  289   — 
Legal settlement and insurance recoveries, net (153)  —  (994)  1,030 
Research and engineering 522   620  1,073   1,347 
Depreciation and amortization 2,635   3,078  5,430   6,152 
Acquisition-related expense, net 13   545  63   822 
Income from operations 9,576   11,374  4,877   6,628 
Interest expense 2,117   3,155  4,055   6,368 
Income before provision (benefit) for income taxes 7,459   8,219  822   260 
Provision (benefit) for income taxes 2,793   2,274  1,509   (326)
Net Income (Loss) 4,666   5,945  (687)  586 
Less: net income attributable to noncontrolling interests, net of taxes 23   8  33   11 
Net Income (Loss) attributable to Mistras Group, Inc.$4,643  $5,937 $(720) $575 
        
Earnings (loss) per common share:       
Basic$0.15  $0.20 $(0.02) $0.02 
Diluted$0.15  $0.20 $(0.02) $0.02 
Weighted-average common shares outstanding:       
Basic 29,957   29,602  29,840   29,514 
Diluted 30,233   30,136  29,840   30,039 


Mistras Group, Inc. and Subsidiaries
Unaudited Operating Data by Segment
(in thousands)

 Three Months Ended June 30, Six Months Ended June 30,
  2022   2021   2022   2021 
Revenues       
Services$149,528  $144,977  $282,474  $269,275 
International 29,610   31,951   57,748   59,599 
Products and Systems 2,652   3,203   5,588   6,191 
Corporate and eliminations (2,759)  (2,454)  (5,117)  (3,653)
 $179,031  $177,677  $340,693  $331,412 
        
        
 Three Months Ended June 30, Six Months Ended June 30,
  2022   2021   2022   2021 
Gross profit       
Services$42,954  $43,761  $73,479  $74,837 
International 9,440   9,615   17,630   17,240 
Products and Systems 1,157   1,952   2,325   3,233 
Corporate and eliminations 7   8   16   27 
 $53,558  $55,336  $93,450  $95,337 


Mistras Group, Inc. and Subsidiaries
Unaudited Revenues by Category
(in thousands)

Revenue by industry was as follows:

Three Months Ended June 30, 2022Services International Products Corp/Elim Total
Oil & Gas$93,098 $8,028 $139 $—  $101,265
Aerospace & Defense 17,300  5,118  26  —   22,444
Industrials 9,794  6,506  333  —   16,633
Power generation & Transmission 8,378  1,997  678  —   11,053
Other Process Industries 11,641  3,754  14  —   15,409
Infrastructure, Research & Engineering 3,183  2,193  442  —   5,818
Petrochemical 3,584  55  —  —   3,639
Other 2,550  1,959  1,020  (2,759)  2,770
Total$149,528 $29,610 $2,652 $(2,759) $179,031


Three Months Ended June 30, 2021Services International Products Corp/Elim Total
Oil & Gas$85,831 $9,533 $212 $—  $95,576
Aerospace & Defense 12,779  4,127  29  —   16,935
Industrials 11,242  6,194  418  —   17,854
Power generation & Transmission 10,073  3,183  830  —   14,086
Other Process Industries 10,356  3,627  35  —   14,018
Infrastructure, Research & Engineering 5,174  3,254  825  —   9,253
Petrochemical 5,936  47  —  —   5,983
Other 3,586  1,986  854  (2,454)  3,972
Total$144,977 $31,951 $3,203 $(2,454) $177,677


Six Months Ended June 30, 2022Services International Products Corp/Elim Total
Oil & Gas$179,711 $15,600 $177 $—  $195,488
Aerospace & Defense 32,322  10,058  134  —   42,514
Industrials 18,801  12,034  835  —   31,670
Power generation & Transmission 12,200  4,559  1,523  —   18,282
Other Process Industries 21,934  7,272  15  —   29,221
Infrastructure, Research & Engineering 5,689  4,232  1,339  —   11,260
Petrochemical 6,629  133  —  —   6,762
Other 5,188  3,860  1,565  (5,117)  5,496
Total$282,474 $57,748 $5,588 $(5,117) $340,693


          
Six Months Ended June 30, 2021Services International Products Corp/Elim Total
Oil & Gas$165,051 $17,469 $268 $—  $182,788
Aerospace & Defense 24,602  8,444  64  —   33,110
Industrials 20,061  11,043  745  —   31,849
Power generation & Transmission 15,607  5,161  1,589  —   22,357
Other Process Industries 18,212  6,539  44  —   24,795
Infrastructure, Research & Engineering 8,343  7,010  1,969  —   17,322
Petrochemical 11,400  119  —  —   11,519
Other 5,999  3,814  1,512  (3,653)  7,672
Total$269,275 $59,599 $6,191 $(3,653) $331,412

Revenue by Oil & Gas Sub-category was as follows:

 Three months ended June 30, Six months ended June 30,
  2022  2021  2022  2021
Oil and Gas Revenue by sub-category       
Upstream$39,443 $36,205 $81,108 $70,131
Midstream 32,949  29,797  57,856  52,235
Downstream 28,873  29,574  56,524  60,422
Total$101,265 $95,576 $195,488 $182,788


Mistras Group, Inc. and Subsidiaries
Unaudited Reconciliation of
Segment and Total Company Income (Loss) from Operations (GAAP) to Income before Special Items (non-GAAP)
(in thousands)

 Three Months Ended June 30, Six Months Ended June 30,
  2022   2021   2022   2021 
Services:       
Income from operations (GAAP)$14,855  $18,358  $18,615  $22,906 
Bad debt provision for troubled customers, net of recoveries 289   —   289   — 
Reorganization and other costs 1   26   28   97 
Legal settlement and insurance recoveries, net —   —   (841)  1,650 
Acquisition-related expense, net —   545   45   788 
Income from operations before special items (non-GAAP)$15,145  $18,929  $18,136  $25,441 
International:       
Income from operations (GAAP)$1,580  $1,809  $1,864  $989 
Reorganization and other costs (187)  30   (99)  126 
Income from operations before special items (non-GAAP)$1,393  $1,839  $1,765  $1,115 
Products and Systems:       
Income (loss) from operations (GAAP)$(420) $209  $(1,002) $(372)
Reorganization and other costs —   —   —   27 
Income (loss) from operations (GAAP)$(420) $209  $(1,002) $(345)
Corporate and Eliminations:       
Loss from operations (GAAP)$(6,439) $(9,002) $(14,600) $(16,895)
Loss on debt modification —   277   —   277 
Legal settlement and insurance recoveries, net (153)  —   (153)  (620)
Reorganization and other costs 6   —   6   — 
Acquisition-related expense, net 13   —   18   34 
Loss from operations before special items (non-GAAP)$(6,573) $(8,725) $(14,729) $(17,204)
Total Company:       
Income from operations (GAAP)$9,576  $11,374  $4,877  $6,628 
Bad debt provision for troubled customers, net of recoveries 289   —   289   — 
Reorganization and other costs (180)  56   (65)  250 
Loss on debt modification —   277   —   277 
Legal settlement and insurance recoveries, net (153)  —   (994)  1,030 
Acquisition-related expense, net 13   545   63   822 
Income from operations before special items (non-GAAP)$9,545  $12,252  $4,170  $9,007 


Mistras Group, Inc. and Subsidiaries
Unaudited Summary Cash Flow Information
(in thousands)

 Three Months Ended June 30, Six Months Ended June 30,
  2022   2021   2022   2021 
Net cash provided by (used in):               
Operating activities$13,208  $14,978  $7,809  $18,126 
Investing activities (3,762)  (6,142)  (6,499)  (10,318)
Financing activities (9,379)  (13,405)  (5,056)  (12,970)
Effect of exchange rate changes on cash (1,379)  334   (1,755)  (656)
Net change in cash and cash equivalents$(1,312) $(4,235) $(5,501) $(5,818)


Mistras Group, Inc. and Subsidiaries
Unaudited Reconciliation of
Net Cash Provided by Operating Activities (GAAP) to Free Cash Flow (non-GAAP)
(in thousands)

 Three Months Ended June 30, Six Months Ended June 30,
  2022   2021   2022   2021 
                
Net cash provided by operating activities (GAAP)$13,208  $14,978  $7,809  $18,126 
Less:               
Purchases of property, plant and equipment (3,631)  (6,185)  (6,692)  (10,188)
Purchases of intangible assets (248)  (268)  (399)  (618)
Free cash flow (non-GAAP)$9,329  $8,525  $718  $7,320 


Mistras Group, Inc. and Subsidiaries
Unaudited Reconciliation of
Gross Debt (GAAP) to Net Debt (non-GAAP)
(in thousands)

 June 30, 2022 December 31, 2021
    
Current portion of long-term debt$21,227  $20,162 
Long-term debt, net of current portion 179,162   182,403 
Total Gross Debt (GAAP) 200,389   202,565 
Less: Cash and cash equivalents (18,609)  (24,110)
Total Net Debt (non-GAAP)$181,780  $178,455 


Mistras Group, Inc. and Subsidiaries
Unaudited Reconciliation of
Net Income (Loss) (GAAP) to Adjusted EBITDA (non-GAAP)
(in thousands)

 Three Months Ended June 30, Six Months Ended June 30,
  2022   2021  2022   2021 
    
Net Income (loss) (GAAP)$4,666  $5,945 $(687) $586 
Less: Net income attributable to non-controlling interests, net of taxes 23   8  33   11 
Net Income (loss) attributable to Mistras Group, Inc.$4,643  $5,937 $(720) $575 
Interest expense 2,117   3,155  4,055   6,368 
Provision (benefit) for income taxes 2,793   2,274  1,509   (326)
Depreciation and amortization 8,128   8,632  16,935   17,197 
Share-based compensation expense 1,255   1,202  2,770   2,464 
Acquisition-related expense 13   545  63   822 
Reorganization and other related costs (benefit), net (180)  56  (65)  250 
Legal settlement and insurance recoveries, net (153)  —  (994)  1,030 
Loss on debt modification —   277  —   277 
Bad debt provision for troubled customers, net of recoveries 289   —  289   — 
Foreign exchange (gain) loss (597)  474  4   932 
Adjusted EBITDA (non-GAAP)$18,308  $22,552 $23,846  $29,589 


Mistras Group, Inc. and Subsidiaries
Unaudited Reconciliation of
Net Income (Loss) (GAAP) and Diluted EPS (GAAP) to Net Income (Loss) Excluding Special Items (non-GAAP)
and Diluted EPS Excluding Special Items (non-GAAP)
(dollars in thousands, except per share data)

 Three Months Ended June 30, Six Months Ended June 30,
  2022   2021   2022   2021 
Net income (loss) attributable to Mistras Group, Inc. (GAAP)$4,643  $5,937  $(720) $575 
Special items (31)  878   (707)  2,379 
Tax impact on special items 24   (189)  180   (557)
Special items, net of tax$(7) $689  $(527) $1,822 
Net income (loss) attributable to Mistras Group, Inc. Excluding Special Items (non-GAAP)$4,636  $6,626  $(1,247) $2,397 
        
Diluted EPS (GAAP)(1)$0.15  $0.20  $(0.02) $0.02 
Special items, net of tax 0.00   0.02   (0.02)  0.06 
Diluted EPS Excluding Special Items (non-GAAP)$0.15  $0.22  $(0.04) $0.08 

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(1) For the six months ended June 30, 2022, 1,412,073 shares related to restricted stock were excluded from the calculation of diluted EPS due to the net loss for the period.