Page 1

Target Hospitality Delivers Exceptional Third Quarter 2021 Results Driven by Significant Cash Flows and Strengthening Customer Demand Led by Government Contracts THE WOODLANDS , Texas , November 12 , 2021 ( PRNewswire ) - Target Hospitality Corp. ( " Target Hospitality " , " Target " or the " Company " ) ( NASDAQ : TH ) , North America's largest provider of vertically - integrated modular accommodations and value - added hospitality services , today reported results for the three months ended September 30 , 2021 . Financial and Operational Highlights for the Third Quarter 2021 Revenue increased to $ 89.2 million for the three months ended September 30 , 2021 , an increase of 85 % year - over year Net income increased to $ 6.7 million for the three months ended September 30 , 2021 , an increase of $ 14.3 million year over - year Basic and diluted earnings per share of $ 0.07 for the three months ended September 30 , 2021 Adjusted EBITDA ( ¹ ) of $ 37.5 million , up 121 % year - over - year Strong cash generation with net cash provided by operating activities of $ 40.0 million and Discretionary Cash Flow ( " DCF " ) ( ¹ ) of $ 34.7 million for the three months ended September 30 , 2021 , representing 39 % DCF yield ( ¹ ) to revenue Improved net leverage ratio by 52 % since the beginning of 2021 , marking significant progress towards year - end 2021 target net leverage ratio of below 3.0 times ● ● Raised full year 2021 financial outlook by 7 % for revenue and 9 % for Adjusted EBITDA ( ¹ ) , representing a 25 % and 42 % increase , respectively , from full year 2020 Executing on premier customer diversification with approximately 52 % of third quarter 2021 revenue related to committed revenue contracts backed by the United States Government Continued strengthening customer demand for Target's premier modular hospitality solutions , with third quarter utilization of 75 % Approximately 73 % of 2021 revenue under committed revenue contracts , with approximately 53 % of anticipated 2021 revenue related to government services Meaningful financial flexibility with over $ 155 million in total available liquidity , with zero outstanding borrowings under the Company's $ 125 million credit facility Executive Commentary " Our impressive third quarter results demonstrate Target's commitment to executing on its strategic objectives . Target continues to benefit from its unique position as North America's leader in modular accommodation solutions and the scale of its world - class network , which has created a unique and efficient operating platform . This platform , along with broadening customer demand , has allowed Target to capture margin expansion and generate significant cash flow through 2021 , " stated Brad Archer , President and Chief Executive Officer . " We have utilized this positive momentum to meaningfully enhance Target's balance sheet , through the significant reduction of outstanding debt , which has resulted in a 52 % improvement in Target's net leverage ratio in 2021. We believe this commitment to prudent capital allocation builds the foundation to continue executing on our strategic growth objectives . We are committed to pursuing a growth strategy focused on enhancing value through a balanced portfolio of service offerings , which we believe creates the greatest opportunity to accelerate value creation for our shareholders , " concluded Mr. Archer . TH Q3 2021 Earnings Release