Target Hospitality Announces First Quarter 2026 Results Highlighting Sustained Momentum and Continued Execution on Strategic Transformation
Rhea-AI Summary
Target Hospitality (NASDAQ: TH) reported Q1 2026 revenue of $72.8 million, a net loss of $13.0 million ($0.13 per share), and Adjusted EBITDA of $9.9 million. Liquidity totaled about $150 million with a 0.6x net leverage ratio.
Since February 2025, the company has secured over $2.0 billion of multi-year contracts, including a new 48‑month AI Infrastructure Community agreement expected to generate more than $750 million of revenue. 2026 guidance calls for $370–$380 million in revenue and $75–$85 million Adjusted EBITDA, with capital expenditures of $460–$480 million.
Positive
- Over $2.0 billion of multi-year contract awards since February 2025
- New 48‑month AI Infrastructure Community contract >$750 million revenue
- Q1 2026 WHS revenue $23.6 million vs. $5.2 million year over year
- Q1 2026 WHS adjusted gross profit $9.3 million vs. $1.3 million year over year
- 2026 revenue outlook raised to $370–$380 million
- Projected annualized revenue >$680 million and Adjusted EBITDA >$240 million exiting 2027
Negative
- Q1 2026 net loss widened to $13.0 million from $6.5 million
- Q1 2026 Adjusted EBITDA fell to $9.9 million from $21.6 million
- Q1 2026 capital expenditures $45.5 million with only $5 million cash on hand
- HFS – South Q1 2026 revenue declined to $33.1 million from $36.1 million
- HFS – South Q1 2026 utilization decreased to 70% from 76%
- Total 2026 capital expenditures guided to $460–$480 million
News Market Reaction – TH
On the day this news was published, TH gained 17.94%, reflecting a significant positive market reaction. Argus tracked a peak move of +8.7% during that session. Our momentum scanner triggered 28 alerts that day, indicating elevated trading interest and price volatility. This price movement added approximately $276M to the company's valuation, bringing the market cap to $1.81B at that time. Trading volume was elevated at 2.9x the daily average, suggesting notable buying interest.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Previous Earnings Reports
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Nov 06 | Q3 2025 earnings | Positive | -15.5% | Contract wins and Hyper/Scale launch alongside modest net loss. |
| Aug 07 | Q2 2025 earnings | Positive | +12.1% | New multi‑year contracts and raised 2025 outlook despite revenue decline. |
| May 19 | Q1 2025 earnings | Positive | +5.1% | Major contracts and solid liquidity while maintaining 2025 guidance. |
| Nov 12 | Q3 2024 earnings | Positive | +6.8% | Strong revenue, earnings, and Adjusted EBITDA with ample liquidity. |
| Aug 07 | Q2 2024 earnings | Positive | +12.1% | High profitability and strong liquidity with reiterated 2024 outlook. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Earnings releases have typically produced sizable moves, with several positive reactions to growth and contract wins but one notable selloff on a contract-heavy update.
Recent earnings for Target Hospitality show a shift from historically high profitability to a contract-driven growth narrative. Past updates highlighted strong liquidity, low net leverage, and expansion into Workforce Hospitality and data-center-related contracts. Reactions ranged from gains after raised outlooks and diversification progress to a sharp drop following Q3 2025 despite significant new awards. Today’s Q1 2026 results continue the theme of AI and infrastructure-focused contracts alongside weaker near-term margins and higher losses.
Key Terms
adjusted ebitda financial
discretionary cash flow financial
net leverage ratio financial
average daily rate (adr) financial
restricted stock units financial
prospectus regulatory
underwritten public offering financial
workforce hospitality solutions technical
AI-generated analysis. How Rhea-AI works. Not financial advice.
Announces new multi-year contract expected to generate over
Supporting over
Financial Highlights for the quarter ended March 31, 2026
- Revenue of
$72.8 million - Net loss of
( .$13.0) million - Basic and diluted loss per share of
$0.13 - Adjusted EBITDA(1) of
$9.9 million - Net Cash Provided by Operating Activities of
$7.0 million $5.8 million - Approximately
$150 million
2026 Operational Achievements and Sustained Momentum on Strategic Growth Initiatives
Since January 2026, Target has announced over
- Today announced a 48-month agreement, awarded May 2026, expected to generate more than
$750 million - In March 2026, announced a
$129 million West Texas power generation and hyperscale AI data center development ("West Texas Power Community"). - In March 2026, announced a
$23 million Pecos, Texas ("Pecos Power Community"). - In April 2026, announced a
$550 million North Texas ("Data Center Hub"). - Executing on the previously announced data center community expansions, with construction activity on track to be completed, as expected, by June 2026. Once completed, the community will be capable of supporting up to 1,050 individuals ("Data Center Community").
- Advanced discussions on multiple potential commercial opportunities to support the accelerating demand for AI-driven infrastructure, and large-scale power generation development.
- Target Hyper/Scale, focused on highly customizable solutions for the rapidly expanding WHS segment, continues to resonate with prospective customers and supports an active growth pipeline exceeding 20,000 beds of potential opportunities.
Executive Commentary
"We are entering the next phase of our growth with strong momentum and increasing confidence in our long‑term strategy. Since February 2025, we have secured more than
"Looking ahead, we are focused on executing recent contract wins while advancing our strategic initiatives. Leveraging our customer‑centric, fully integrated platform, we are well positioned to support accelerating investment across data center, power generation, and other critical infrastructure markets. These capabilities underpin ongoing and advanced discussions across a robust pipeline of potential commercial opportunities. With a scalable and sustainable Target Hyper/Scale platform and a strong financial profile, we believe Target is uniquely positioned to pursue and execute on an expanding addressable end-market opportunity, deploy capital efficiently, and drive durable long‑term value creation," concluded Mr. Archer.
Financial Results
First Quarter Summary Highlights
For the Three Months Ended ($ in '000s, except per share amounts) - | March 31, 2026 | March 31, 2025 | |||||
Revenue | $ | 72,781 | $ | 69,897 | |||
Net loss | $ | (12,962) | $ | (6,459) | |||
Loss per share – basic and diluted | $ | (0.13) | $ | (0.07) | |||
Adjusted EBITDA(1) | $ | 9,941 | $ | 21,571 | |||
Average utilized beds | 9,468 | 9,898 | |||||
Utilization | 54 | % | 60 | % | |||
Revenue was
The increase in revenue was primarily driven by new contract awards in the WHS segment and the completion of the ramp-up phases associated with the contract award at the Company's
Net loss was
Adjusted EBITDA(1) was
The change in net loss and Adjusted EBITDA primarily reflect elevated operating expenses associated with services, mobilization, and construction related activity supporting the rapid expansion of the WHS segment and loss of the higher margin PCC contract in the government segment.
The first quarter of 2026 was a transitional period, reflecting a lower margin profile as legacy higher-margin contracts ended in 2025 and new WHS contracts continued to ramp. As recently awarded WHS contracts commence operations and scale, Target expects meaningful margin improvement over the balance of 2026, supported by strong underlying unit economics.
Capital Management
The Company had approximately
As of March 31, 2026, the Company had approximately
Business Update and Full Year 2026 Outlook
Target continues to expand its presence across strategic end markets supported by long-term demand fundamentals, including AI-driven data center development, critical minerals, and large-scale power generation infrastructure. Since February 2025, Target has secured over
These sustained WHS end market demand fundamentals supported today's announcement of the AI Infrastructure Contract, which is expected to generate approximately
The continued growth in Target's WHS segment has transformed the business and accelerated Target's successful pivot towards higher-quality end-market demand with sustained secular growth dynamics. These accomplishments further validate the Target Hyper/Scale platform and the ability to provide highly customized integrated solutions to meet accelerating customer demand.
These factors are the foundation of an expanding pipeline of potential growth opportunities exceeding 20,000 beds supporting data center and related critical infrastructure development across multi-year cycles. Target Hyper/Scale continues to position the Company as a trusted partner for larger, more complex deployments that require speed-to-market, customization, and the ability to scale with dynamic project schedules across multiple geographies and phases of development.
Target's vertically integrated operating model—spanning community design, construction, mobilization, and a comprehensive suite of hospitality services—enables rapid execution. This approach delivers tailored, scalable solutions and gives customers a single partner as needs evolve over multi-year timelines. Target's established presence in project-dense regions adds logistical efficiency and operational leverage, allowing it to ramp multiple awards concurrently and grow with customers' operational demands.
The Company's customer-centric model is a key differentiator, with Target employees living and working alongside community residents. Target collaborates closely to design customized solutions, stay flexible as requirements change, and deliver consistent service at scale—supporting repeat wins, expansions, and longer-duration contracts, with compelling unit economics.
With these strong business fundamentals and a durable operating model, Target has established a robust financial profile underpinned by disciplined capital management. Combined with a growing portfolio of high-quality contracts that enhance revenue visibility and generate consistent cash flows, these strengths position the Company to appropriately scale capital resources in support of concurrent community developments.
Target remains focused on executing across its existing contract portfolio while simultaneously pursuing the most active and robust development pipeline in its history. Together, these initiatives support the Company's ability to capitalize on strong end-market demand fundamentals, accelerate its strategic transformation, and drive long-term value creation, while maintaining capital allocation priorities focused on high-return growth initiatives that further strengthen the contract portfolio and reinforce long-duration revenue visibility supported by stable cash flows.
Full Year 2026 Financial Outlook:
Driven by meaningful growth in the WHS segment, Target has made significant progress advancing its strategic growth initiatives, strengthening its contract portfolio and improving revenue visibility to support consistent cash flows and enhanced margin contribution. The Company is well-positioned to execute on recent contract awards while advancing the most active and robust development pipeline in its history. This foundation supports the Company's increased 2026 outlook driven by continued growth in new community activity and the commencement and scaling of recently awarded WHS contracts, including the AI Infrastructure Community.
- Total revenue between
$370 $380 million - Adjusted EBITDA(1) between
$75 $85 million - Total Capital Expenditures between
$460 $480 million
Consistent with the Company's disciplined capital allocation framework, total capital expenditures are focused on supporting contracted growth in the Company's WHS segment associated with long-duration contracted cash flows, including approximately
As recent WHS contract awards come online and scale through 2026, along with the build‑out and completion of the Data Center Hub and AI Infrastructure Community in 2027, the Company expects revenue and adjusted EBITDA to build through 2026 and into 2027. Target's expanding operational scale and strong unit economics are also anticipated to support margin improvement over this period. Together, these factors position the Company to achieve annualized revenue exceeding
Segment Results – First Quarter 2026
Hospitality & Facilities Services - South
Refer to exhibits to this earnings release for definitions and reconciliations of Non-GAAP financial measures to GAAP financial measures
For the Three Months Ended ($ in '000s, except ADR) - | March 31, 2026 | March 31, 2025 | |||||
Revenue | $ | 33,057 | $ | 36,068 | |||
Adjusted gross profit(1) | $ | 8,403 | $ | 11,033 | |||
Average daily rate (ADR) | $ | 71.52 | $ | 70.07 | |||
Average utilized beds | 5,055 | 5,653 | |||||
Utilization | 70 | % | 76 | % | |||
Revenue and adjusted gross profit for the three months ended March 31, 2026, were
Target continues to optimize its HFS – South network of communities with a focus on disciplined pricing, cost efficiency and asset utilization, while preserving flexibility to redeploy capacity toward high-return growth opportunities across its broader portfolio.
Workforce Hospitality Solutions
Refer to exhibits to this earnings release for definitions and reconciliations of Non-GAAP financial measures to GAAP financial measures
For the Three Months Ended ($ in '000s) - | March 31, 2026 | March 31, 2025 | ||||
Revenue | $ | 23,620 | $ | 5,204 | ||
Adjusted gross profit(1) | $ | 9,265 | $ | 1,269 | ||
Revenue for the three months ended March 31, 2026, was
The increases were driven by recent WHS contract awards, including the Data Center Community and the West Texas Power Community. Additionally, the increases were partially attributable to continued progress on the workforce hub contract announced in February 2025 as activity continues to shift from the construction phases into the services phase.
The Company expects margin expansion across this segment in 2026 as the Data Center Community and Data Center Hub contracts ramp, with additional uplift anticipated from other recently announced WHS contracts as these communities scale and benefit from strong unit economics. Driven by increasing contributions from WHS contract awards, Target expects this segment to be the Company's largest operating segment for full year 2026.
Target's growth pipeline is supported by sustained demand across its WHS segment, fueled by ongoing
Government
Refer to exhibits to this earnings release for definitions and reconciliations of Non-GAAP financial measures to GAAP financial measures
For the Three Months Ended ($ in '000s) - | March 31, 2026 | March 31, 2025 | |||||
Revenue | $ | 13,443 | $ | 25,717 | |||
Adjusted gross profit(1) | $ | 4,955 | $ | 19,178 | |||
Revenue for the three months ended March 31, 2026, was
The decreases were primarily driven by the termination of the PCC Contract, partially offset by the Dilley Contract award.
Additionally, in the first quarter of 2026, the Company incurred carrying costs related to assets successfully redeployed from the Government segment to support recently announced WHS contract awards, which compressed adjusted gross profit in the Government segment for the period.
Looking ahead, the Company expects to incur transitional costs related to ongoing network optimization initiatives in the Government segment over the next two quarters, which are expected to temporarily impact segment operating margins.
All Other
Refer to exhibits to this earnings release for definitions and reconciliations of Non-GAAP financial measures to GAAP financial measures
For the Three Months Ended ($ in '000s) - | March 31, 2026 | March 31, 2025 | |||||
Revenue | $ | 2,661 | $ | 2,908 | |||
Adjusted gross profit(1) | $ | (165) | $ | 156 | |||
This category of operating segments consists of hospitality services revenue not included in other segments. Revenue for the three months ended March 31, 2026, was
Conference Call
The Company has scheduled a conference call for May 11, 2026, at 8:00 a.m. Central Time (9:00 am Eastern Time) to discuss the first quarter 2026 results.
The conference call will be available by live webcast through the Investors section of Target Hospitality's website at www.TargetHospitality.com or by connecting via phone through one of the following options:
Please utilize the Direct Phone Dial option to be immediately entered into the conference call once you are ready to connect.
Direct Phone Dial
RapidConnect URL): |
Or the traditional, operator assisted dial-in below.
Domestic: | 1-800-836-8184 |
Please register for the webcast or dial into the conference call approximately 15 minutes prior to the scheduled start time.
About Target Hospitality
Target Hospitality is one of
Cautionary Statement Regarding Forward Looking Statements
Certain statements made in this press release (including the financial outlook contained herein) are "forward looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words "estimates," "projected," "expects," "anticipates," "forecasts," "plans," "intends," "believes," "seeks," "may," "will," "should," "future," "propose" and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside our control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, that may affect actual results or outcomes include: operational, economic, including inflation, political and regulatory risks; our ability to effectively compete in the specialty rental accommodations and hospitality services industry, including growing the HFS – South, Workforce Hospitality Solutions and Government segments; our ability to execute, expand, and manage WHS projects supporting critical mineral development, power generation, and data center infrastructure projects; our ability to achieve margin improvement through the effective servicing of new contracts; natural disasters and other business disruptions including outbreaks of epidemic or pandemic disease; the duration of any future public health crisis, related economic repercussions and the resulting negative impact to global economic demand; the effect of changes in state building codes on marketing our buildings; changes in demand within a number of key industry end-markets and geographic regions, including natural resources, critical minerals, and data center/AI infrastructure; changes in customer capital spending, project schedules, or end-user demand that may result in delays, non-renewals, or cancellations of contracts, including the contract that is terminable for convenience in the Government segment; our reliance on third party manufacturers, suppliers and service providers; our ability to attract and retain key personnel and maintain workforce availability for specialized hospitality and construction operations; increases in raw material, food, labor or other operating costs; the effect of impairment charges on our operating results; our future operating results fluctuating, failing to match performance or to meet expectations; our exposure to various possible claims and the potential inadequacy of our insurance coverage; unanticipated changes in our tax obligations; our obligations under various laws and regulations, including those applicable to government contracts; the effect of litigation, judgments, orders, regulatory or customer bankruptcy proceedings on our business; our ability to successfully acquire and integrate new operations; global, national or local economic and political developments, including any changes in policy under the current or any future
- Non-GAAP Financial Measures
This press release contains historical non-GAAP financial measures including Adjusted gross profit, EBITDA, Adjusted EBITDA, and Discretionary cash flows which are measurements not calculated in accordance with US GAAP, in the discussion of our financial results because they are key metrics used by management to assess financial performance. Our business is capital-intensive, and these additional metrics allow management to further evaluate our operating performance. Reconciliations of these measures to the most directly comparable GAAP financial measures are contained herein. To the extent required, statements disclosing the definitions, utility and purposes of these measures are also set forth herein.
This press release also contains a forward-looking non-GAAP financial measure Adjusted EBITDA. Reconciliations of this forward-looking measure to its most directly comparable GAAP financial measures are unavailable to Target Hospitality without unreasonable effort. We cannot provide a reconciliation of forward-looking Adjusted EBITDA to GAAP financial measures because certain items required for such reconciliation are outside of our control and/or cannot be reasonably predicted, such as the provision for income taxes. Preparation of such reconciliation would require a forward-looking balance sheet, statement of income and statement of cash flow, prepared in accordance with GAAP, and such forward-looking financial statements are unavailable to us without unreasonable effort. Although we provide a minimum of Adjusted EBITDA that we believe will be achieved, we cannot accurately predict all the components of the Adjusted EBITDA calculation. Target Hospitality provides an Adjusted EBITDA outlook because we believe that this measure, when viewed with our results under GAAP, provides useful information for the reasons noted below.
Definitions:
Target Hospitality defines Adjusted gross profit, as Gross profit plus depreciation of specialty rental assets, loss on impairment, and certain severance costs.
Target Hospitality defines EBITDA as net income (loss) before interest expense and loss on extinguishment of debt, income tax expense (benefit), depreciation of specialty rental assets, and other depreciation and amortization. Adjusted EBITDA reflects the following additional adjustments to EBITDA to exclude certain non-cash items and expense or income items that management believes are not indicative of the Company's ongoing operating performance:
- Other expense, net: Other expense, net includes miscellaneous cash receipts, gains and losses on disposals of property, plant, and equipment and leased assets, community pre-opening costs incurred during ramp-up periods of new customer contracts, and other immaterial expenses and non-cash items. Community pre-opening costs primarily relate to certain operating costs incurred prior to the community becoming fully operational.
- Transaction expenses: During 2026, the Company incurred legal, advisory, and audit-related fees associated with the secondary public offering by Arrow Holdings S.à r.l. and MFA Global S.à r.l., entities controlled by investment funds managed by TDR Capital LLP, as well as legal costs related to certain contemplated transactions. During 2025, transaction costs primarily related to legal, advisory and audit-related fees associated with debt related transaction activity related to the 2025 Senior Secured Notes, which were redeemed and paid off on March 25, 2025, and, to a lesser extent, other business development project related transaction activity and remaining costs associated with the Arrow Proposal.
- Stock-based compensation: Charges associated with stock-based compensation expense, which has been, and is expected to continue to be for the foreseeable future, a significant recurring expense and an important component of the Company's compensation strategy.
- Other adjustments: Claim settlement and corporate development related costs.
We define Discretionary cash flows as cash flows from operations less maintenance capital expenditures for specialty rental assets.
Utility and Purposes:
EBITDA reflects Net income (loss) excluding the impact of interest expense and loss on extinguishment of debt, provision for income taxes, depreciation, and amortization. We believe that EBITDA is a meaningful indicator of operating performance because we use it to measure our ability to service debt, fund capital expenditures, and expand our business. We also use EBITDA, as do analysts, lenders, investors, and others, to evaluate companies because it excludes certain items that can vary widely across different industries or among companies within the same industry. For example, interest expense can be dependent on a company's capital structure, debt levels, and credit ratings. Accordingly, the impact of interest expense on earnings can vary significantly among companies. The tax positions of companies can also vary because of their differing abilities to take advantage of tax benefits and because of the tax policies of the jurisdictions in which they operate. As a result, effective tax rates and provision for income taxes can vary considerably among companies. EBITDA also excludes depreciation and amortization expense because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets. These differences can result in considerable variability in the relative costs of productive assets and the depreciation and amortization expense among companies.
Target Hospitality also believes that Adjusted EBITDA is a meaningful indicator of operating performance. Our Adjusted EBITDA reflects adjustments to exclude the effects of additional items, including certain items, that are not reflective of the ongoing operating results of Target Hospitality. In addition, to derive Adjusted EBITDA, we exclude gains or losses on the sale and disposal of depreciable assets and impairment losses because including them in EBITDA is inconsistent with reporting the ongoing performance of our remaining assets. Additionally, the gain or loss on sale and disposal of depreciable assets and impairment losses represents either accelerated depreciation or excess depreciation in previous periods, and depreciation is excluded from EBITDA.
Target Hospitality also presents Discretionary cash flows because we believe it provides useful information regarding our business as more fully described below. Discretionary cash flows indicate the amount of cash available after maintenance capital expenditures for specialty rental assets for, among other things, investments in our existing business.
Adjusted gross profit, EBITDA, Adjusted EBITDA and Discretionary cash flows are not measurements of Target Hospitality's financial performance under GAAP and should not be considered as alternatives to Gross profit, Net income (loss), or other performance measures derived in accordance with GAAP, or as alternatives to Cash flow from operating activities as measures of Target Hospitality's liquidity. Adjusted gross profit, EBITDA, Adjusted EBITDA, and Discretionary cash flows should not be considered as discretionary cash available to Target Hospitality to reinvest in the growth of our business or as measures of cash that is available to it to meet our obligations. In addition, the measurement of Adjusted gross profit, EBITDA, Adjusted EBITDA, and Discretionary cash flows may not be comparable to similarly titled measures of other companies. Target Hospitality's management believes that Adjusted gross profit, EBITDA, Adjusted EBITDA, and Discretionary cash flows provides useful information to investors about Target Hospitality and its financial condition and results of operations for the following reasons: (i) they are among the measures used by Target Hospitality's management team to evaluate its operating performance; (ii) they are among the measures used by Target Hospitality's management team to make day-to-day operating decisions, (iii) they are frequently used by securities analysts, lenders, investors and other interested parties as a common performance measure and to compare results across companies in Target Hospitality's industry.
Investor Contact:
Mark Schuck
(832) 702 – 8009
ir@targethospitality.com
Exhibit 1 Target Hospitality Corp. Consolidated Statements of Comprehensive loss ($ in thousands, except per share amounts) | ||||||
For the Three Months Ended | ||||||
March 31, | ||||||
2026 | 2025 | |||||
(unaudited) | (unaudited) | |||||
Revenue: | ||||||
Services income | $ | 46,511 | $ | 50,107 | ||
Specialty rental income | 16,576 | 14,995 | ||||
Construction fee income | 9,694 | 4,795 | ||||
Total revenue | 72,781 | 69,897 | ||||
Costs: | ||||||
Services and construction costs | 46,738 | 35,768 | ||||
Specialty rental | 3,585 | 2,493 | ||||
Depreciation of specialty rental assets | 15,575 | 13,672 | ||||
Gross profit | 6,883 | 17,964 | ||||
Selling, general and administrative | 14,557 | 14,805 | ||||
Other depreciation and amortization | 4,021 | 3,973 | ||||
Other expense, net | 2,628 | 262 | ||||
Operating loss | (14,323) | (1,076) | ||||
Loss on extinguishment of debt | — | 2,370 | ||||
Interest expense, net | 892 | 4,329 | ||||
Loss before income tax | (15,215) | (7,775) | ||||
Income tax benefit | (2,253) | (1,316) | ||||
Net loss | (12,962) | (6,459) | ||||
Less: Net income (loss) attributable to the noncontrolling interest | (43) | 2 | ||||
Net loss attributable to Target Hospitality Corp. common stockholders | (12,919) | (6,461) | ||||
Other comprehensive loss | ||||||
Foreign currency translation | (26) | (4) | ||||
Comprehensive loss | $ | (12,988) | $ | (6,463) | ||
Weighted average number shares outstanding - basic and diluted | 99,930,789 | 99,111,940 | ||||
Net loss per share attributable to Target Hospitality Corp. common | $ | (0.13) | $ | (0.07) | ||
Exhibit 2 Target Hospitality Corp. Condensed Consolidated Balance Sheet Data ($ in thousands) (unaudited) | ||||||
March 31, | December 31, | |||||
2026 | 2025 | |||||
Assets | ||||||
Cash and cash equivalents | $ | 5,461 | $ | 8,348 | ||
Accounts receivable, less allowance for credit losses | 45,634 | 56,200 | ||||
Other current assets | 7,511 | 8,790 | ||||
Total current assets | 58,606 | 73,338 | ||||
Specialty rental assets, net | 354,685 | 332,406 | ||||
Goodwill and other intangibles, net | 77,007 | 80,370 | ||||
Other non-current assets | 49,242 | 44,091 | ||||
Total assets | $ | 539,540 | $ | 530,205 | ||
Liabilities | ||||||
Accounts payable | $ | 33,041 | $ | 44,393 | ||
Deferred revenue and customer deposits | 10,985 | 9,282 | ||||
Other current liabilities | 25,200 | 30,368 | ||||
Total current liabilities | 69,226 | 84,043 | ||||
Long-term debt | 30,000 | — | ||||
Other non-current liabilities | 63,692 | 57,102 | ||||
Total liabilities | 162,918 | 141,145 | ||||
Stockholders' equity | ||||||
Common stock and other stockholders' equity | 94,584 | 93,998 | ||||
Accumulated earnings | 282,340 | 295,259 | ||||
Total stockholders' equity attributable to Target Hospitality Corp. | 376,924 | 389,257 | ||||
Noncontrolling interest in consolidated subsidiaries | (302) | (197) | ||||
Total stockholders' equity | 376,622 | 389,060 | ||||
Total liabilities and stockholders' equity | $ | 539,540 | $ | 530,205 | ||
Exhibit 3 Target Hospitality Corp. Condensed Consolidated Cash Flow Data ($ in thousands) (unaudited) | ||||||
For the Three Months Ended | ||||||
March 31, | ||||||
2026 | 2025 | |||||
Cash and cash equivalents - beginning of period | $ | 8,348 | $ | 190,668 | ||
Cash flows from operating activities | ||||||
Net loss | (12,962) | (6,459) | ||||
Adjustments: | ||||||
Depreciation | 16,233 | 14,282 | ||||
Amortization of intangible assets | 3,363 | 3,363 | ||||
Other non-cash items | 1,871 | 5,388 | ||||
Changes in operating assets and liabilities | (1,465) | (12,635) | ||||
Net cash provided by operating activities | $ | 7,040 | $ | 3,939 | ||
Cash flows from investing activities | ||||||
Purchases of specialty rental assets | (32,594) | (16,590) | ||||
Proceeds from the sale of property, plant and equipment | 275 | - | ||||
Purchase of property, plant, and equipment | (176) | (615) | ||||
Other investing activities | (6,860) | - | ||||
Net cash used in investing activities | $ | (39,355) | $ | (17,205) | ||
Cash flows from financing activities | ||||||
Other financing activities | 29,432 | (142,937) | ||||
Net cash provided by (used in) financing activities | $ | 29,432 | $ | (142,937) | ||
Effect of exchange rate changes on cash and cash equivalents | (4) | 3 | ||||
Change in cash and cash equivalents | (2,887) | (156,200) | ||||
Cash and cash equivalents - end of period | $ | 5,461 | $ | 34,468 | ||
Exhibit 4 Target Hospitality Corp. Reconciliation of Gross profit to Adjusted gross profit ($ in thousands) (unaudited) | |||||
For the Three Months Ended | |||||
March 31, | |||||
2026 | 2025 | ||||
Gross Profit | $ | 6,883 | $ | 17,964 | |
Adjustments: | |||||
Depreciation of specialty rental assets | 15,575 | 13,672 | |||
Adjusted gross profit | $ | 22,458 | $ | 31,636 | |
Exhibit 5 Target Hospitality Corp. Reconciliation of Net loss to EBITDA and Adjusted EBITDA ($ in thousands) (unaudited) | |||||
For the Three Months Ended | |||||
March 31, | |||||
2026 | 2025 | ||||
Net loss | $ | (12,962) | $ | (6,459) | |
Income tax benefit | (2,253) | (1,316) | |||
Interest expense, net | 892 | 4,329 | |||
Loss on extinguishment of debt | — | 2,370 | |||
Other depreciation and amortization | 4,021 | 3,973 | |||
Depreciation of specialty rental assets | 15,575 | 13,672 | |||
EBITDA | $ | 5,273 | $ | 16,569 | |
Adjustments | |||||
Other expense, net | 2,628 | 262 | |||
Transaction expenses | 332 | 2,830 | |||
Stock-based compensation | 1,658 | 1,716 | |||
Other adjustments | 50 | 194 | |||
Adjusted EBITDA | $ | 9,941 | $ | 21,571 | |
Exhibit 6 Target Hospitality Corp. Reconciliation of Net cash provided by operating activities to Discretionary cash flows ($ in thousands) (unaudited) | ||||||
For the Three Months Ended | ||||||
March 31, | ||||||
2026 | 2025 | |||||
Net cash provided by operating activities | $ | 7,040 | $ | 3,939 | ||
Less: Maintenance capital expenditures for specialty rental assets | (1,249) | (3,995) | ||||
Discretionary cash flows | $ | 5,791 | $ | (56) | ||
Purchase of specialty rental assets | (32,594) | (16,590) | ||||
Purchase of property, plant and equipment | (176) | (615) | ||||
Other investing activities | (6,860) | — | ||||
Proceeds from the sale of property, plant and equipment | 275 | — | ||||
Net cash used in investing activities | $ | (39,355) | $ | (17,205) | ||
Principal payments on finance and finance lease obligations | (511) | (509) | ||||
Principal payments on borrowings from ABL Facility | (18,600) | (34,100) | ||||
Proceeds from borrowings on ABL Facility | 48,600 | 75,000 | ||||
Repayment of 2025 Senior Secured Notes | — | (181,446) | ||||
Distribution paid to noncontrolling interest | (57) | (68) | ||||
Payment of debt extinguishment premium costs | — | (1,814) | ||||
Net cash provided by (used in) financing activities | $ | 29,432 | $ | (142,937) | ||
View original content:https://www.prnewswire.com/news-releases/target-hospitality-announces-first-quarter-2026-results-highlighting-sustained-momentum-and-continued-execution-on-strategic-transformation-302767653.html
SOURCE Target Hospitality