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U.S. Silica Holdings, Inc. Announces Third Quarter 2015 Results

The following excerpt is from the company's SEC filing.

Third quarter revenue of $155.4 million

Basic EPS of $0.05 for the quarter

Overall tons sold in Oil and Gas segment up 32% sequentially

ISP contribution margin up 19% year-over-year

Frederick, Md., Oct. 27, 2015 U.S. Silica Holdings, Inc. (NYSE: SLCA) today announced net income of $2.4 million or $0.05 per basic share and $0.04 per diluted share for the third quarter ended Sept. 30, 2015 compared with net income of $41.3 million or $0.77 per basic share and $0.76 per diluted share for the third quarter of 2014. The third quarter earnings per share included a tax benefit of $0.09 p er share, which was the result of an update to the estimated annual effective tax rate, excluding discrete items, from 0% to (16)%. Excluding the tax benefit, business development related expenses and restructuring costs for actions designed to help bring the business more in line with current market conditions, EPS was $(0.03) per basic share.

We took decisive actions during the quarter to profitably sell higher volume in our Oil and Gas business and take share, said Bryan Shinn, president and chief executive officer. However, he cautioned that we expect to see a decline sequentially in volumes and margins in our Oil and Gas business as drilling and completion activity is expected to slow down significantly in the fourth quarter.

Commenting on the industrial and specialty products segment, Shinn said, ISP had a record quarter for contribution margin as it continues to benefit from strong end markets like building products and automotive and the introduction of new, higher margin products. Our industrial business is on track for possibly the best year in its 115-year history and is a testament to the strength of our corporate model, with two complementary business units, which serves us well through a wide variety of economic cycles and market conditions, he added.

Third Quarter 2015 Highlights

Total Company

Revenue totaled $155.4 million compared with $241.3 million for the same period last year, a decrease of 36% on a year-over-year basis and an increase of 5% sequentially from the second quarter of 2015.

Overall tons sold totaled 2.6 million, down 12% compared with 3.0 million tons sold in the third quarter of 2014 and an increase of 16% sequentially from the second quarter of 2015.

Contribution margin for the quarter was $36.5 million, down 61% compared with $93.9 million in the same period of the prior year and an increase of 11% sequentially from the second quarter of 2015.

Adjusted EBITDA was $24.0 million compared with Adjusted EBITDA of $77.5 million for the same period last year, a decrease of 69% on a year-over-year basis and an increase of 2% sequentially from the second quarter of 2015.

Income tax benefit of $4.7 million represented the cumulative adjustment during the quarter to reflect the updated estimated annual effective tax rate.

Revenue for the quarter totaled $102.0 million compared with $186.8 million in the same period in 2014, a decrease of 45% on a year-over-year basis and an increase of 12% sequentially from the second quarter of 2015.

Tons sold totaled 1.6 million, a decrease of 15% compared with 1.9 million tons sold in the third quarter of 2014 and an increase of 32% sequentially compared with the tons sold in the second quarter of 2015.

61% of tons were sold in basin compared with 67% sold in basin in the third quarter of 2014.

Segment contribution margin was $16.5 million versus $77.0 million in the third quarter of 2014, a decrease of 79% on a year-over-year basis and an increase of 25% sequentially compared with the second quarter of 2015.

Industrial and Specialty Products

Revenue for the quarter totaled $53.4 million compared with $54.4 million for the same period in 2014, a decrease of 2% on a year-over-year basis and a 6% decrease on a sequential basis from the second quarter of 2015.

Tons sold totaled 1.0 million, a decrease of 8% on a year-over-year basis and down 3% on a sequential basis compared with the second quarter of 2015.

Segment contribution margin was $20.0 million compared with $16.8 million in the third quarter of 2014, an increase of 19% on a year-over-year basis and up 2% sequentially compared with the second quarter of 2015.

Capital Update

As of Sept. 30, 2015, the Company had $299.8 million in cash and cash equivalents and short term investments and $46.9 million available under its credit facilities. Total debt at Sept. 30, 2015 was $492.5 million. Capital expenditures in the third quarter totaled $11.0 million and were associated largely with the Companys investments in various maintenance, expansion and cost improvement...


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