US Silica Holdings Inc : U.S. Silica Holdings, Inc. Announces First Quarter 2012 Results
05/08/2012 | 08:15am EST
Reaffirms Full Year 2012 Guidance
U.S. Silica Holdings, Inc. (NYSE: SLCA) today announced net income of
$19.1 million, or $0.37 per basic and diluted share for the quarter
ended March 31, 2012, compared with net income of $3.5 million, or $0.07
per share for the same period in 2011.
Summary Financial and Operating Data
(unaudited; $ in millions, except statistics and per share)
Three Months Ended March 31,
Key Operating Statistics:
Tons Sold: (000s)
Oil & Gas
Industrial & Specialty Products
Adjusted EBITDA (a)
EPS, Basic and Diluted
A reconciliation of Adjusted EBITDA, a non-GAAP financial measure,
to net income, the most comparable GAAP measure, and other
important information appears on page 6.
President and Chief Executive Officer Bryan Shinn commented, "We are
very pleased with our first quarter performance, delivering record
revenues and earnings for the Company. Customers continue to highly
value our premium Ottawa white sand, our multi-plant-multi-basin
logistics capabilities, and supply chain responsiveness. We believe we
are well positioned for continued success and reaffirm our guidance for
the full year 2012."
The Company reported first quarter 2012 revenues of $102.6 million, an
increase of $38.2 million, or 59% from $64.4 million in 2011 driven by
continued growth in demand for our Ottawa White frac sand. Overall sales
volume increased 19% during the first quarter of 2012 to 1.7 million
tons, as compared to 1.5 million tons in the first quarter of 2011.
First quarter 2012 sales volume within our Oil & Gas Proppants segment
increased by 57%, to 679 thousand tons, compared to 434 thousand tons in
2011, while sales volumes for our Industrial and Specialty Products
segment grew year over year by 29 thousand tons, or 3%, to 1,064
thousand tons, compared to 1,035 thousand tons in the prior year.
SG&A expense was $9.9 million in the first quarter of 2012, as compared
to $5.3 million for 2011. The increase was driven by increased staffing
to support our Oil & Gas Proppants segment and to support the
transformation and administrative requirements of a public company.
Adjusted EBITDA increased 121%, or $20.3 million, to $37.0 million for
the three months ended March 31, 2012, as compared to $16.7 million for
the three months ended March 31, 2011, driven by accelerated volume
increases in our Oil & Gas Proppants segment, as well as increased
pricing in both segments. Adjusted EBITDA margin percentage increased
for the three months ended March 31, 2012 to 36%, compared to 26% during
the three months ended March 31, 2011.
As of March 31, 2012, we had $84.6 million of cash on hand and $24.0
million available under our credit facilities. Our total outstanding
debt at March 31, 2012 was $261.2 million.
Outlook and Guidance
The Company reaffirms full year 2012 guidance with revenues of
approximately $395 million to $420 million and Adjusted EBITDA of
approximately $142 million to $150 million. The Company has raised the
range for full year 2012 capital spend to between $100 million to $115
million. Spending is expected to be primarily directed towards the
construction of a resin-coated sand plant in Rochelle, IL and a new
Greenfield raw sand plant in Sparta, WI, with $15 million allocated for
U.S. Silica will host a conference call for investors today, May 8, 2012
at 10:00 a.m. Eastern Time to discuss these results. Hosting the call
will be Bryan A. Shinn, President and Chief Executive Officer, and
William A. White, Chief Financial Officer.
The call can be accessed live over the telephone by dialing (877)
705-6003, or for international callers, (201) 493-6725. A replay will be
available shortly after the call and can be accessed by dialing (877)
870-5176, or for international callers, (858) 384-5517. The passcode for
the replay is 392803. The replay will be available until May 22, 2012.
Interested parties may also listen to a simultaneous webcast of the
conference call by logging onto U.S. Silica's website at www.ussilica.com
in the Investors Resources section. A replay of the webcast will also be
available for approximately 2 weeks following the call.
About U.S. Silica Holdings, Inc.
U.S. Silica Holdings, Inc., a Delaware corporation, is the second
largest domestic producer of commercial silica, a specialized mineral
that is a critical input into the oil and gas proppants end market and a
variety of attractive industrial and specialty products end markets.
During its 112-year history, U.S. Silica Holdings, Inc. has developed
core competencies in mining, processing, logistics and materials science
that enable it to produce and cost-effectively deliver over 200 products
to customers across these end markets. U.S. Silica Holdings, Inc. is
headquartered in Frederick, Maryland.
Certain statements in this press release are "forward-looking
statements" made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995 and speak only as of this date.
Forward-looking statements include any statement that does not directly
relate to any historical or current fact and may include, but are not
limited to, statements regarding U.S. Silica's growth opportunities,
strategy, future financial results, forecasts, projections, plans and
capital expenditures, and the commercial silica industry.
Forward-looking statements are based on our current expectations and
assumptions, which may not prove to be accurate. These statements are
not guarantees and are subject to risks, uncertainties and changes in
circumstances that are difficult to predict. Many factors could cause
actual results to differ materially and adversely from these
forward-looking statements. Among these factors are (1) fluctuations in
demand for commercial silica; (2) the cyclical nature of our customers'
businesses; (3) operating risks that are beyond our control; (4)
federal, state and local legislative and regulatory initiatives relating
to hydraulic fracturing; (5) our ability to implement our capacity
expansion plans within our current timetable and budget; (6) loss of, or
reduction in, business from our largest customers; (7) increasing costs
or a lack of dependability or availability of transportation services or
infrastructure; (8) our substantial indebtedness and pension
obligations; (9) our ability to attract and retain key personnel; (10)
silica-related health issues and corresponding litigation; (11) seasonal
and severe weather conditions; and (12) extensive and evolving
environmental, mining, health and safety, licensing, reclamation and
other regulation (and changes in their enforcement or interpretation).
Additional information concerning these and other factors can be found
in U.S. Silica's filings with the Securities and Exchange Commission. We
undertake no obligation to publicly update or revise any forward-looking
statement as a result of new information, future events or otherwise,
except as otherwise required by law.
U.S. SILICA HOLDINGS, INC.
COMBINED STATEMENTS OF OPERATIONS
(unaudited; in thousands, except per share amounts)
Three Months Ended March 31,
Cost of goods sold (excluding depreciation, depletion and
Selling, general and administrative
Advisory fees to parent
Depreciation, depletion and amortization
Other (expense) income
Other income, net, including interest income
Income before income taxes
Income tax expense
Earnings per share:
U.S. SILICA HOLDINGS, INC.
COMBINED BALANCE SHEETS
(in thousands, except share and per share amounts)
December 31, 2011
Cash and cash equivalents
Accounts receivable, net
Prepaid expenses and other current assets
Deferred income taxes, net
Income tax receivable
Total current assets
Property, plant and mine development, net
Debt issuance costs, net
Customer relationships, net
LIABILITIES AND STOCKHOLDERS' EQUITY
Current portion of long-term debt
Income tax payable
Current portion of deferred revenue
Total current liabilities
Note payable to parent
Liability for pension and other post-retirement benefits
Deferred income taxes, net
Other long-term obligations
Commitments and contingencies
Common stock - $0.01 par value, 100,000,000 authorized shares;
52,941,176 and 50,000,000 shares issued and outstanding at March 31,
2012 and December 31, 2011, respectively
Additional paid-in capital
Accumulated other comprehensive loss
Total stockholders' equity
Total liabilities and stockholders' equity
Non-GAAP Financial Measures
Adjusted EBITDA is not a measure of our financial performance or
liquidity under GAAP and should not be considered as an alternative to
net income as a measure of operating performance, cash flows from
operating activities as a measure of liquidity or any other performance
measure derived in accordance with GAAP. Additionally, Adjusted EBITDA
is not intended to be a measure of free cash flow for management's
discretionary use, as it does not consider certain cash requirements
such as interest payments, tax payments and debt service requirements.
Adjusted EBITDA contains certain other limitations, including the
failure to reflect our cash expenditures, cash requirements for working
capital needs and cash costs to replace assets being depreciated and
amortized, and excludes certain non-recurring charges that may recur in
the future. Management compensates for these limitations by relying
primarily on our GAAP results and by using Adjusted EBITDA only
supplementally. Our measure of Adjusted EBITDA is not necessarily
comparable to other similarly titled captions of other companies due to
potential inconsistencies in the methods of calculation.
The following table sets forth a reconciliation of net income, the most
directly comparable GAAP financial measure, to Adjusted EBITDA.
Three Months Ended
Total interest expense, net of interest income
Provision for taxes (benefit)
Total depreciation, depletion and amortization expenses
Non-recurring expenses (income) (1)
Transaction expenses (2)
Permitted management fees and expenses (3)
Non-cash incentive compensation (4)
Post-employment expenses (excluding service costs) (5)
Other adjustments allowable under our existing credit agreements (6)
Includes the gain on the sale of assets.
Includes fees and expenses related to the January 27, 2012
amendment of our Term Loan Facility and ABL Facility.
Includes fees and expense paid to Golden Gate Capital for ongoing
consulting and management services provided pursuant to an
Advisory Agreement entered into in connection with the Golden Gate
Capital Acquisition; this Advisory Agreement was terminated in
connection with our IPO.
Includes vesting of incentive equity compensation issued to our
Includes net pension cost and net post-retirement cost relating to
pension and other post-retirement benefit obligations during the
applicable period, but in each case excluding the service cost
relating to benefits earned during such period.
Reflects miscellaneous adjustments permitted under our existing
credit agreements, including such items as expenses related to
reviewing growth initiatives and potential acquisitions.
U.S. Silica Holdings, Inc. Telephone: 855-SILICA-7 (855-745-4227) Email: