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Steel Partners Holdings L.P. Reports Second Quarter Financial Results and Outlook

August 7, 2018

NEW YORK--(BUSINESS WIRE)--Aug 7, 2018--Steel Partners Holdings L.P. (NYSE: SPLP), a diversified global holding company, today announced operating results for the second quarter and six months ended June 30, 2018. For a full discussion of the results, please see the Company’s Form 10-Q as filed with the U.S. Securities and Exchange Commission, which can be found at www.steelpartners.com.

Revenue for the 2018 second quarter increased to $434.4 million from $358.4 million for the same period in 2017. Income before income taxes and equity method investments was $19.6 million for the second quarter of 2018, compared with $26.1 million in the comparable 2017 period. Net income attributable to the Company’s common unitholders for the 2018 second quarter was $13.0 million, or $0.42 per diluted common unit, compared with $11.3 million, or $0.41 per diluted common unit, for the same period in 2017.

Revenue for the six months ended June 30, 2018 increased to $800.7 million from $681.7 million for the same period in 2017. Income before income taxes and equity method investments was $10.1 million for the six months ended June 30, 2018, compared with $23.5 million in the comparable 2017 period. Net income attributable to the Company’s common unitholders for the six months ended June 30, 2018 was $4.0 million, or $0.15 per diluted common unit, compared with $7.2 million, or $0.27 per diluted common unit, for the same period in 2017.

The Company generated a 26.2% increase in Adjusted EBITDA for the second quarter of 2018 to $63.7 million from $50.4 million for the same period in 2017 and generated a 22.5% increase in Adjusted EBITDA for the six months ended June 30, 2018 to $98.8 million from $80.7 million for the same period in 2017.

Results for the three and six months ended June 30, 2018, and the comparable periods in 2017, include certain significant acquisition and integration-related costs associated with the Company’s recently completed transactions, as well as other non-cash income or loss from associated companies and other investments held at fair value, net of taxes, which are allocated by segment. The 2017 six-month period reflects an accrual for incentive unit expense of $4.9 million based on an increase in the market price of the Company’s common units. No comparable expense was recorded in the 2018 period.

Adjusted EBITDA for the three and six months ended June 30, 2018 reflects a higher contribution from the Company’s Diversified Industrial segment, including the impact of the acquisition of Dunmore, as well as the Energy and Financial Services segments. The Company is presenting Adjusted EBITDA to assist investors with their understanding of Steel Partners’ results of operations and financial condition. See “Note Regarding Use of Non-GAAP Financial Measurements” below for the definition of Adjusted EBITDA.

“We continued to make solid operating progress during the second quarter, although results were impacted by certain cash and non-cash acquisition and investment related expenses,” said Warren Lichtenstein, Executive Chairman of Steel Partners. “The Company achieved year-over-year increases in revenue and Adjusted EBITDA in each of our business segments for the quarter. The positive performance reflects the hard work of the entire Steel Partners team, along with implementation of our strategic initiatives, and adherence throughout the company to the disciplines of the Steel Business System - a unique culture of watchful management, shared problem solving and striving for continuous improvement.

“Further, we continue to develop our people to grow and reach their potential under our SteelGrow talent program,” said Lichtenstein. “Recent internal promotions have included John Ashe as President and CEO of our Lucas-Milhaupt unit and Sarah Corrigan to Chair our Wellness Council, which promotes employee well-being to enhance productivity, recruitment and retention.”

Based on current information, Steel Partners expects 2018 third quarter revenue between $379 million and $440 million and Adjusted EBITDA between $50 million and $61 million. The Company anticipates revenue for the full 2018 year between $1.6 billion and $1.7 billion and Adjusted EBITDA between $198 million and $220 million, as compared with the Company’s previously reported annual guidance for the full 2018 year of revenue between $1.5 billion and $1.6 billion and Adjusted EBITDA between $184 million and $225 million.

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