Fairmount Santrol (NYSE:FMSA), a leading provider of
high-performance sand and sand-based product solutions, today
announced results for the second quarter ended June 30, 2017.
Second-Quarter 2017 Results
Second-quarter 2017 revenues were $233.2 million, up 35% from
$172.6 million in the first quarter of 2017 and up 104% from $114.2
million in the second quarter of 2016. Total Company volumes sold
were 3.3 million tons for the quarter, up 22% from 2.7 million tons
sold in the first quarter of 2017 and an increase of 68% from 2.0
million tons in the second quarter of 2016.
For second-quarter 2017, the Company had net income of $10.5
million, or $0.05 per diluted share, compared with a net loss of
$11.6 million, or $(0.05) per diluted share, in the first quarter
of 2017. Net loss for second-quarter 2016 was $87.9 million, or
$(0.54) per diluted share.
Adjusted EBITDA for the second quarter of 2017 was $47.0
million, which excludes non-cash stock compensation expense of $2.8
million and $0.4 million from the write-off of deferred financing
fees. Second-quarter 2017 Adjusted EBITDA includes $1.5 million in
costs related to plant start-ups and $3.2 million of freight
charges to move 1,200 railcars from storage and into the Company’s
active fleet. First-quarter 2017 Adjusted EBITDA was $21.7 million
and excluded non-cash stock compensation expense of $2.4 million,
but included $0.9 million of start-up costs from plant
reactivations. The Adjusted EBITDA loss for the second quarter of
2016 was $21.8 million, and excludes the impact from non-cash stock
compensation expense and asset impairment charges totaling $94.5
million. The second-quarter 2016 Adjusted EBITDA loss
includes the impact of inventory write-downs, restructuring costs
and professional fees of $16.8 million.
Jenniffer Deckard, President and Chief Executive Officer, said,
“Our second-quarter results demonstrate our ability to capture
growth, in both raw sand and coated proppants, from improving
conditions in the oil & gas markets and to deliver solid,
steady growth in our I&R segment.” Deckard continued, “We have
prudently added capacity in our Proppant Solutions segment as
customer demand has strengthened and pricing has improved, and we
have leveraged our logistics network to deliver strong
profitability growth in the second quarter.”
The Company recently announced plans for a new facility near
Kermit, Texas, in the Permian basin that is expected to add 3
million tons of annual proppant sand production. The Kermit
facility further broadens the Company’s product portfolio, and with
the re-opening of the Shakopee, Minnesota, mine, will enable the
Company to capitalize on growing market demand.
Business Segments
Proppant Solutions Segment
For the second quarter of 2017, Proppant Solutions volumes were
2.6 million tons, an increase of 24% compared with the first
quarter of 2017 and up over 100% compared with the prior-year
period. Raw proppant sand volumes were 2.4 million tons, a 25%
sequential increase and a 95% increase compared with the same
period a year ago. As incremental capacity was brought online from
Brewer and Maiden Rock, the Company was able to capture additional
market demand, which contributed to overall volume growth. However,
supply remains tight, particularly for finer grades. Coated
proppant volumes were 193,000 tons, a 20% increase compared with
the first quarter of 2017 and a 133,000-ton increase from the
prior-year period.
Proppant Solutions revenues were $198.8 million in
second-quarter 2017, a 41% increase compared with $141.0 million in
the first quarter of 2017 and a $117 million increase compared with
$82.1 million in the second quarter a year ago. Proppant Solutions
revenues were positively impacted by higher volumes and pricing, as
well as by a mix shift toward in-basin sales. Average raw proppant
sand pricing in second-quarter 2017 increased more than $8 per ton
as compared to first-quarter 2017, based on a consistent mix.
Proppant Solutions gross profit increased to $54.4 million, or
$21 per ton, in the second quarter of 2017 compared with $27.3
million, or $13 per ton, in the first quarter of 2017.
Second-quarter 2017 Proppant Solutions gross profit includes $1.5
million of costs related to plant start-ups and $3.2 million of
freight charges to move 1,200 railcars to the Company’s active
fleet. The sequential improvement in Proppant Solutions gross
profit is due to higher pricing and greater volumes, resulting in
improved fixed cost leverage and higher gross margins. Gross profit
for the segment in the second quarter of 2016 was a loss of $13.5
million and included $9.9 million of inventory write-downs.
Industrial and Recreational Products Segment
Industrial and Recreational volumes were 687,000 tons in second
quarter 2017, up 15% from first-quarter 2017 and up 4% from the
prior-year second quarter.
Revenues for the segment were $34.4 million in second quarter
2017, a 9% increase from $31.6 million in the first quarter and a
7% increase from $32.1 million for the second quarter 2016. The
increase in revenue from the second quarter 2016 was primarily due
to increased volumes, higher pricing versus the prior-year period
and a modest mix shift toward value-added products.
Industrial and Recreational gross profit was $15.7 million, or
46% of sales, in second-quarter 2017, compared with $13.5 million,
or 43% of sales, in the first quarter of 2017. Gross profit for the
segment in the second quarter of 2016 was $13.6 million, or 42% of
sales, and included $0.4 million of inventory write-downs in the
quarter. The $2.1 million year-over-year improvement in gross
profit was driven by higher fixed cost leverage and a mix shift
toward higher-margin products.
Balance Sheet and Other Information
Through the first six months of 2017, net cash generated by
operating activities was $54.2 million, which was largely due to
higher profitability over the period, offset somewhat by an
increase in working capital as a result of increased sales.
Further, tax refunds of $16 million were received in the second
quarter and are included in net cash generated by operating
activities. Net cash used in financing activities in the first six
months of 2017 was $57.0 million, primarily a result of the June
30, 2017, $50 million term debt pre-payment, as previously
announced, as well as recurring scheduled debt service payments.
Capital expenditures were $14.2 million for the six months ended
June 30, 2017, which included $7.2 million spent in the second
quarter.
As of June 30, 2017, cash and cash equivalents totaled $178.5
million, and total debt was $796.1 million, resulting in net debt
of $617.6 million, representing a quarterly reduction in net debt
of $16.9 million.
Michael Biehl, Executive Vice President and Chief Financial
Officer, commented, “We are pleased by the opportunities our
recently announced capacity expansion at Kermit provides for us and
our customers. The lease structure has given us the flexibility to
both invest in our business and continue the progress that we have
made in optimizing our capital structure by prepaying $50 million
in term debt. Our top priorities for the coming quarters will be to
continue to reduce our net debt through free cash flow generation
and to refinance our term debt that is due in September 2019, in
addition to replacing our existing revolving credit facility, which
expires in September 2018.”
Looking Forward
The Company recently announced plans for expansion in Kermit,
Texas, to build a 3-million-ton annual-capacity plant with an
anticipated operational start-up at the beginning of second-quarter
2018. The Company is also in the process of reopening its Shakopee,
Minnesota, mine and sand processing plant, which is located on the
Union Pacific railroad, with expectations to be operational by the
end of the third quarter of 2017. The addition of these two mines
will add approximately 3.7 million tons of annual processing
capacity to the Company’s total mining footprint.
Full-year 2017 ongoing capital expenditures, excluding the new
Kermit, Texas site, are still expected to be between $47 million to
$50 million. The Company estimates total capital expenditures
and leasehold interest payments of $100 million to $110 million
related to the Kermit site over the next 12 months.
Deckard noted, “As we look to the remainder of 2017 and beyond,
we expect proppant demand to grow across all basins, with a
continued broad mix of product and grade distribution. Our strategy
to expand our industry-leading product portfolio, our production
capacity, and our comprehensive logistics network will keep us in
an excellent position to meet the diverse needs of our customers
and to benefit from the continued changes in market demand.”
Use of Certain GAAP and Non-GAAP Financial
Measures
The Company defines EBITDA as net income before interest
expense, income tax expense, depreciation, depletion and
amortization. Adjusted EBITDA is defined as EBITDA before non-cash
stock-based compensation, asset impairments, and certain other
income or expenses. The Company believes EBITDA and Adjusted EBITDA
are useful because they allow management to more effectively
evaluate our operational performance and compare the results of our
operations from period to period without regard to our financing
costs or capital structure.
Conference Call
Fairmount Santrol will host a conference call and live webcast
for analysts and investors today, August 3, 2017, at 10 a.m.
Eastern Time to discuss the Company's 2017 second-quarter financial
results. Investors are invited to listen to a live audio webcast of
the conference call, which will be accessible on the Investor
Relations section of the Company’s website. To access the live
webcast, please log in 15 minutes prior to the start of the call to
download and install any necessary audio software. An archived
replay of the call will also be available on the website following
the call. The call can also be accessed live by dialing (877)
201-0168 or, for international callers, (647) 788-4901. The
conference ID for the call is 47489888. A replay will be available
shortly after the call and can be accessed by dialing (800)
585-8367 or (416) 621-4642. The passcode for the replay is
47489888. The replay of the call will be available through August
10, 2017.
About Fairmount Santrol
Fairmount Santrol is a leading provider of high-performance sand
and sand-based product solutions used by oil and gas exploration
and production companies to enhance the productivity of their
wells. The Company also provides high-quality products, strong
technical leadership and applications knowledge to end users in the
foundry, building products, water filtration, glass, and sports and
recreation markets. Its expansive logistics capabilities include a
wide-ranging network of distribution terminals and railcars that
allow the Company to effectively serve customers wherever they
operate. As one of the nation’s longest continuously operating
mining organizations, Fairmount Santrol has developed a strong
commitment to all three pillars of sustainable development, People,
Planet and Prosperity. Correspondingly, the Company’s motto and
action orientation is: “Do Good. Do Well.” For more information,
visit FairmountSantrol.com.
Forward-Looking Statements Certain statements
contained in this press release constitute “forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995. These forward-looking statements represent the
Company’s expectations or beliefs concerning future events, and it
is possible that the results described in this press release will
not be achieved. These forward-looking statements are subject to
risks, uncertainties and other factors, many of which are outside
of the Company’s control that could cause actual results to differ
materially from the results discussed in the forward-looking
statements. These factors include: changes in prevailing economic
conditions, including continuing pressure on and fluctuations in
demand for, and pricing of, our products; loss of, or reduction in
business from the Company’s largest customers or their failure to
pay the Company; possible adverse effects of being leveraged,
including interest rate, event of default or refinancing risks, as
well as potentially limiting the Company’s ability to invest in
certain market opportunities; the level of cash flows generated to
provide adequate liquidity; our ability to successfully develop and
market new products, including Propel SSP® and related products;
our rights and ability to mine our property and our renewal or
receipt of the required permits and approvals from government
authorities and other third parties; our ability to implement and
realize efficiencies from capacity expansion plans, facility
reactivation and cost reduction initiatives within our time and
budgetary parameters; increasing costs or a lack of dependability
or availability of transportation services or infrastructure and
geographic shifts in demand; changing legislative and regulatory
initiatives relating to our business, including environmental,
mining, health and safety, licensing, reclamation and other
regulation relating to hydraulic fracturing (and changes in their
enforcement and interpretation); silica-related health issues and
corresponding litigation; seasonal and severe weather conditions;
and other operating risks that are beyond our control.
Any forward-looking statement speaks only as of the date on
which it is made, and, except as required by law, the Company does
not undertake any obligation to update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise. New factors emerge from time to time,
and it is not possible for the Company to predict all such factors.
When considering these forward-looking statements, you should keep
in mind the risk factors and other cautionary statements in
Fairmount Santrol Holdings Inc.’s filings with the Securities and
Exchange Commission (“SEC”). The risk factors and other factors
noted in our filings with the SEC could cause our actual results to
differ materially from those contained in any forward-looking
statement.
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|
Fairmount
Santrol |
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|
|
|
|
|
|
|
Condensed
Consolidated Statements of Income (Loss) |
|
|
|
|
|
|
|
|
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
|
2017 |
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except per share
amounts) |
|
(in thousands, except per share
amounts) |
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
$ |
233,226 |
|
$ |
114,249 |
|
|
$ |
405,809 |
|
|
$ |
259,707 |
|
|
Cost of goods sold
(excluding depreciation, depletion, |
|
|
|
|
|
|
|
|
|
and
amortization shown separately) |
|
|
163,136 |
|
|
114,129 |
|
|
|
294,888 |
|
|
|
232,593 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
|
|
Selling,
general and administrative expenses(A) |
|
|
25,863 |
|
|
25,040 |
|
|
|
48,333 |
|
|
|
43,318 |
|
|
Depreciation, depletion and amortization expense |
|
|
19,846 |
|
|
18,056 |
|
|
|
39,288 |
|
|
|
36,642 |
|
|
Asset
impairments |
|
|
- |
|
|
90,578 |
|
|
|
- |
|
|
|
90,654 |
|
|
Restructuring charges |
|
|
- |
|
|
1,155 |
|
|
|
- |
|
|
|
1,155 |
|
|
Other
operating expense (income) |
|
|
355 |
|
|
(426 |
) |
|
|
(705 |
) |
|
|
(96 |
) |
|
Income
(loss) from operations |
|
|
24,026 |
|
|
(134,283 |
) |
|
|
24,005 |
|
|
|
(144,559 |
) |
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net |
|
|
12,983 |
|
|
16,606 |
|
|
|
25,520 |
|
|
|
33,868 |
|
|
Other non-operating
income |
|
|
- |
|
|
- |
|
|
|
- |
|
|
|
(5 |
) |
|
Income
(loss) before provision (benefit) for income taxes |
|
|
11,043 |
|
|
(150,889 |
) |
|
|
(1,515 |
) |
|
|
(178,422 |
) |
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit) for
income taxes |
|
|
520 |
|
|
(63,019 |
) |
|
|
(628 |
) |
|
|
(78,773 |
) |
|
Net income (loss) |
|
|
10,523 |
|
|
(87,870 |
) |
|
|
(887 |
) |
|
|
(99,649 |
) |
|
Less: Net income
attributable to the non-controlling interest |
|
|
40 |
|
|
16 |
|
|
|
218 |
|
|
|
13 |
|
|
Net income
(loss) attributable to Fairmount Santrol Holdings
Inc. |
|
$ |
10,483 |
|
$ |
(87,886 |
) |
|
$ |
(1,105 |
) |
|
$ |
(99,662 |
) |
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per
share |
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.05 |
|
$ |
(0.54 |
) |
|
$ |
- |
|
|
$ |
(0.62 |
) |
|
Diluted |
|
$ |
0.05 |
|
$ |
(0.54 |
) |
|
$ |
- |
|
|
$ |
(0.62 |
) |
|
|
|
|
|
|
|
|
|
|
|
Weighted average number
of shares outstanding |
|
|
|
|
|
|
|
|
|
Basic |
|
|
224,015 |
|
|
161,647 |
|
|
|
223,878 |
|
|
|
161,547 |
|
|
Diluted |
|
|
228,184 |
|
|
161,647 |
|
|
|
223,878 |
|
|
|
161,547 |
|
|
|
|
|
|
|
|
|
|
|
|
(A) -
Stock compensation expense of $2,763 and $3,914 for the three
months ended June 30, 2017 and 2016, respectively, and $5,179 and
$5,567 for the six months ended June 30, 2017 and 2016,
respectively, are included within selling, general, and
administrative expenses. |
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|
Fairmount
Santrol |
|
|
|
|
|
Condensed
Consolidated Statements of Cash Flows |
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|
|
|
(unaudited) |
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|
|
|
|
|
Six Months Ended June 30, |
|
|
|
|
2017 |
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
|
|
|
|
|
|
Net loss |
|
$ |
(887 |
) |
|
$ |
(99,649 |
) |
|
Adjustments to
reconcile net loss to net cash provided by (used in) operating
activities: |
|
|
|
|
|
Depreciation and depletion |
|
|
35,508 |
|
|
|
34,284 |
|
|
Amortization |
|
|
6,305 |
|
|
|
5,745 |
|
|
Reserve
for doubtful accounts |
|
|
(209 |
) |
|
|
1,954 |
|
|
Write-off
of deferred financing costs |
|
|
389 |
|
|
|
- |
|
|
Asset
impairments |
|
|
- |
|
|
|
90,654 |
|
|
Inventory
write-downs and reserves |
|
|
1,266 |
|
|
|
10,302 |
|
|
(Gain)
loss on sale of fixed assets |
|
|
(552 |
) |
|
|
35 |
|
|
Deferred
income taxes and taxes payable |
|
|
1,044 |
|
|
|
(59,913 |
) |
|
Refundable income taxes |
|
|
18,591 |
|
|
|
(15,535 |
) |
|
Stock
compensation expense |
|
|
5,179 |
|
|
|
5,567 |
|
|
Change in
operating assets and liabilities: |
|
|
|
|
|
Accounts
receivable |
|
|
(44,602 |
) |
|
|
10,524 |
|
|
Inventories |
|
|
(9,423 |
) |
|
|
3,500 |
|
|
Prepaid
expenses and other assets |
|
|
(991 |
) |
|
|
3,745 |
|
|
Accounts
payable |
|
|
11,024 |
|
|
|
298 |
|
|
Accrued
expenses and deferred revenue |
|
|
31,606 |
|
|
|
(4,450 |
) |
|
Net cash provided by (used in) operating
activities |
|
|
54,248 |
|
|
|
(12,939 |
) |
|
|
|
|
|
|
|
Cash flows from
investing activities |
|
|
|
|
|
Proceeds
from sale of fixed assets |
|
|
1,216 |
|
|
|
3,918 |
|
|
Capital
expenditures and stripping costs |
|
|
(14,236 |
) |
|
|
(21,948 |
) |
|
Earnout
payments |
|
|
(250 |
) |
|
|
- |
|
|
Other
investing activities |
|
|
- |
|
|
|
(150 |
) |
|
Net cash used in investing activities |
|
|
(13,270 |
) |
|
|
(18,180 |
) |
|
|
|
|
|
|
|
Cash flows from
financing activities |
|
|
|
|
|
Payments
on long-term debt |
|
|
(4,299 |
) |
|
|
(5,899 |
) |
|
Prepayments on term loans |
|
|
(50,000 |
) |
|
|
(69,580 |
) |
|
Payments
on capital leases and other long-term debt |
|
|
(2,087 |
) |
|
|
(4,109 |
) |
|
Proceeds
from option exercises |
|
|
536 |
|
|
|
2,007 |
|
|
Tax
payments for withholdings on share-based awards exercised or
distributed |
|
|
(1,091 |
) |
|
|
(292 |
) |
|
Tax
effect of stock options exercised, forfeited, or expired |
|
|
- |
|
|
|
(1,297 |
) |
|
Transactions with non-controlling interest |
|
|
(22 |
) |
|
|
(551 |
) |
|
Net cash used in financing activities |
|
|
(56,963 |
) |
|
|
(79,721 |
) |
|
|
|
|
|
|
|
Change in
cash and cash equivalents related to assets classified as
held-for-sale |
|
|
- |
|
|
|
1,376 |
|
|
Foreign
currency adjustment |
|
|
443 |
|
|
|
(387 |
) |
|
Decrease in cash and cash equivalents |
|
|
(15,542 |
) |
|
|
(109,851 |
) |
|
|
|
|
|
|
|
Cash and cash
equivalents: |
|
|
|
|
|
Beginning of period |
|
|
194,069 |
|
|
|
171,486 |
|
|
End of period |
|
$ |
178,527 |
|
|
$ |
61,635 |
|
|
|
|
|
|
|
Fairmount
Santrol |
|
|
|
|
Condensed
Consolidated Balance Sheets |
|
|
|
|
(unaudited) |
|
|
|
|
|
|
June 30, 2017 |
|
December 31, 2016 |
|
|
|
|
|
|
|
(in thousands) |
Assets |
|
|
|
|
Current assets |
|
|
|
|
Cash and
cash equivalents |
|
$ |
178,527 |
|
|
$ |
194,069 |
|
Accounts
receivable, net |
|
|
123,753 |
|
|
|
78,942 |
|
Inventories, net |
|
|
60,807 |
|
|
|
52,650 |
|
Prepaid
expenses and other assets |
|
|
5,628 |
|
|
|
7,065 |
|
Refundable income taxes |
|
|
2,487 |
|
|
|
21,077 |
|
Total
current assets |
|
|
371,202 |
|
|
|
353,803 |
|
|
|
|
|
|
Property,
plant and equipment, net |
|
|
716,362 |
|
|
|
727,735 |
|
Deferred
income taxes |
|
|
1,244 |
|
|
|
1,244 |
|
Goodwill |
|
|
15,301 |
|
|
|
15,301 |
|
Intangibles, net |
|
|
92,524 |
|
|
|
95,341 |
|
Other
assets |
|
|
8,206 |
|
|
|
9,486 |
|
Total assets |
|
$ |
1,204,839 |
|
|
$ |
1,202,910 |
|
|
|
|
|
|
Liabilities and
Equity |
|
|
|
|
Current
liabilities |
|
|
|
|
Current
portion of long-term debt |
|
$ |
12,172 |
|
|
$ |
10,707 |
|
Accounts
payable |
|
|
51,654 |
|
|
|
37,263 |
|
Accrued
expenses and deferred revenue |
|
|
48,912 |
|
|
|
26,185 |
|
Total
current liabilities |
|
|
112,738 |
|
|
|
74,155 |
|
|
|
|
|
|
Long-term
debt |
|
|
783,946 |
|
|
|
832,306 |
|
Deferred
income taxes |
|
|
7,839 |
|
|
|
7,057 |
|
Other
long-term liabilities |
|
|
43,311 |
|
|
|
38,272 |
|
Total
liabilities |
|
|
947,834 |
|
|
|
951,790 |
|
|
|
|
|
|
Equity |
|
|
|
|
Common
stock |
|
|
2,423 |
|
|
|
2,422 |
|
Additional paid-in capital |
|
|
298,038 |
|
|
|
297,649 |
|
Retained
earnings |
|
|
263,314 |
|
|
|
264,852 |
|
Accumulated other comprehensive loss |
|
|
(18,190 |
) |
|
|
(19,002 |
) |
Treasury
stock at cost |
|
|
(288,849 |
) |
|
|
(294,874 |
) |
Non-controlling interest |
|
|
269 |
|
|
|
73 |
|
Total
equity |
|
|
257,005 |
|
|
|
251,120 |
|
Total liabilities and equity |
|
$ |
1,204,839 |
|
|
$ |
1,202,910 |
|
|
|
|
|
|
Fairmount
Santrol |
|
|
|
|
|
|
|
|
|
|
Segment
Reports |
|
|
|
|
|
|
|
|
|
|
|
(unaudited) |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
Three Months Ended March 31, |
|
|
|
2017 |
|
|
2016 |
|
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except volume
amounts) |
|
(in thousands, except volume
amounts) |
|
(in thousands, except volume
amounts) |
|
|
|
|
|
|
|
|
|
|
|
|
Volume
(tons) |
|
|
|
|
|
|
|
|
|
|
Proppant
Solutions |
|
|
|
|
|
|
|
|
|
|
Raw
sand |
|
|
2,393,647 |
|
|
1,230,077 |
|
|
|
4,314,480 |
|
|
2,643,325 |
|
|
1,920,833 |
Coated
proppant |
|
|
193,242 |
|
|
59,826 |
|
|
|
354,740 |
|
|
172,530 |
|
|
161,498 |
Total
Proppant Solutions |
|
|
2,586,889 |
|
|
1,289,903 |
|
|
|
4,669,220 |
|
|
2,815,855 |
|
|
2,082,331 |
|
|
|
|
|
|
|
|
|
|
|
Industrial & Recreational Products |
|
|
686,831 |
|
|
661,244 |
|
|
|
1,282,209 |
|
|
1,248,422 |
|
|
595,378 |
|
|
|
|
|
|
|
|
|
|
|
Total volumes |
|
|
3,273,720 |
|
|
1,951,147 |
|
|
|
5,951,429 |
|
|
4,064,277 |
|
|
2,677,709 |
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
|
|
|
|
|
|
|
|
|
Proppant
Solutions |
|
$ |
198,812 |
|
$ |
82,102 |
|
|
$ |
339,805 |
|
$ |
199,565 |
|
$ |
140,993 |
Industrial & Recreational Products |
|
|
34,414 |
|
|
32,147 |
|
|
|
66,004 |
|
|
60,142 |
|
|
31,590 |
Total
revenues |
|
|
233,226 |
|
|
114,249 |
|
|
|
405,809 |
|
|
259,707 |
|
|
172,583 |
|
|
|
|
|
|
|
|
|
|
|
Segment gross
profit |
|
|
|
|
|
|
|
|
|
|
Proppant
Solutions |
|
|
54,373 |
|
|
(13,529 |
) |
|
|
81,719 |
|
|
3,063 |
|
|
27,346 |
Industrial & Recreational Products |
|
|
15,717 |
|
|
13,649 |
|
|
|
29,202 |
|
|
24,051 |
|
|
13,485 |
Total
segment gross profit |
|
|
70,090 |
|
|
120 |
|
|
|
110,921 |
|
|
27,114 |
|
|
40,831 |
|
|
|
|
|
|
|
|
|
|
|
Fairmount
Santrol |
|
|
|
|
|
|
|
|
|
|
Non-GAAP
Financial Measures |
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited) |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
Three Months Ended March 31, |
|
|
|
2017 |
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
(in thousands) |
|
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation
of Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) attributable to Fairmount Santrol Holdings
Inc. |
|
$ |
10,483 |
|
$ |
(87,886 |
) |
|
$ |
(1,105 |
) |
|
$ |
(99,662 |
) |
|
$ |
(11,588 |
) |
Interest
expense, net |
|
|
12,983 |
|
|
16,606 |
|
|
|
25,520 |
|
|
|
33,868 |
|
|
|
12,537 |
|
Provision
(benefit) for income taxes |
|
|
520 |
|
|
(63,019 |
) |
|
|
(628 |
) |
|
|
(78,773 |
) |
|
|
(1,148 |
) |
Depreciation, depletion, and amortization expense |
|
|
19,846 |
|
|
18,056 |
|
|
|
39,288 |
|
|
|
36,642 |
|
|
|
19,442 |
|
EBITDA |
|
|
43,832 |
|
|
(116,243 |
) |
|
|
63,075 |
|
|
|
(107,925 |
) |
|
|
19,243 |
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash
stock compensation expense(1) |
|
|
2,763 |
|
|
3,914 |
|
|
|
5,179 |
|
|
|
5,567 |
|
|
|
2,416 |
|
Asset
impairments(2) |
|
|
- |
|
|
90,578 |
|
|
|
- |
|
|
|
90,654 |
|
|
|
- |
|
Write-off
of deferred financing costs(3) |
|
|
389 |
|
|
- |
|
|
|
389 |
|
|
|
- |
|
|
|
- |
|
Adjusted
EBITDA |
|
$ |
46,984 |
|
$ |
(21,751 |
) |
|
$ |
68,643 |
|
|
$ |
(11,704 |
) |
|
$ |
21,659 |
|
__________ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Represents the non-cash expense for stock-based awards issued to
our employees and outside directors. |
|
|
|
|
|
|
|
|
|
|
|
(2)
Non-cash charges associated with the impairment of mineral reserves
and other long-lived assets. |
|
|
|
|
|
|
|
|
|
|
|
(3)
Represents the write-off of deferred financing fees in relation to
term loan prepayment. |
Investor contacts:
Indrani Egleston
440-214-3219
Indrani.Egleston@fairmountsantrol.com
Matthew Schlarb
440-214-3284
Matthew.Schlarb@fairmountsantrol.com
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