A previous press release was issued with an incorrect reference
to full year 2019 capital expenditure guidance.The capital
expenditure guidance should refer to full year 2018. This press
release reflects this change.
Hi-Crush Partners LP (NYSE: HCLP), "Hi-Crush" or the "Partnership",
today reported third quarter 2018 results. Revenues for the third
quarter of 2018 totaled $214.0 million on sales of 2,775,360 tons
of frac sand. This compares to $248.5 million of revenues on sales
of 3,037,504 tons of frac sand in the second quarter of 2018. The
limited partners' interest in net income was $26.5 million for the
third quarter of 2018, resulting in $0.30 basic and $0.29 diluted
earnings per limited partner unit.
Earnings before interest, taxes, depreciation
and amortization adjusted for earnings from equity method
investments and loss on extinguishment of debt ("Adjusted EBITDA")
was $50.6 million in the third quarter of 2018, compared to $81.5
million for the second quarter of 2018. Distributable cash flow
attributable to the limited partners for the third quarter of 2018
was $40.0 million compared to $66.6 million for the second quarter
of 2018. There was no distributable cash flow attributable to the
holder of the incentive distribution rights ("IDRs") for the third
quarter of 2018, compared to $7.8 million for the second quarter of
2018.
"The third quarter experienced a rapid change in
market conditions in the frac sand sector," said Mr. Robert E.
Rasmus, Chairman and Chief Executive Officer of Hi-Crush. “This
change, attributable to declines in well completion activity and
therefore demand for frac sand, impacted the market for Northern
White volumes and pricing, which we expect to continue in the
fourth quarter. The accelerated pace of slowdown in well completion
activity, combined with supply additions and build-up of
inventories in-basin, resulted in lower pricing for Northern White
sand across all basins. We remain committed to our Mine. Move.
Manage. operating strategy and to expanding our frac sand logistics
solutions offering. We believe our focus on logistics will
differentiate Hi-Crush and continue to benefit unitholders,
particularly as the market rebounds in 2019 due to operator budget
resets and the alleviation of takeaway capacity constraints in the
Permian Basin.”
Third Quarter 2018 Results
Revenues for the third quarter of 2018 totaled
$214.0 million, compared to $248.5 million for the second quarter
of 2018. The decrease was driven by lower pricing and reduced
volumes. Lower pricing resulted from the slowdown in demand for
frac sand that emerged during the third quarter of 2018, due to
decreased well completions as E&Ps reduced activity during the
quarter. The decline in demand was exacerbated by the start-up of
new in-basin volumes in the Permian. Average sales price declined
to $64 per ton in the third quarter of 2018, compared to $70 per
ton in the second quarter of 2018. The reduced sales volumes
sequentially reflect lower activity levels experienced during the
third quarter, but were partially mitigated by sales made directly
to operators and through our PropStream integrated last mile
logistics service. Of the total sales volumes reported in the third
quarter of 2018, 24% were sold at the wellsite through PropStream,
compared to 20% in the second quarter of 2018. Volumes sold
directly to E&Ps represented 40% of the total in the third
quarter of 2018, compared to 31% in the second quarter of 2018.
Both sales volumes through PropStream and sales volumes sold direct
to E&Ps also increased on an absolute basis in the third
quarter.
Contribution margin was $23.92 per ton in the
third quarter of 2018, compared to $30.94 per ton in the second
quarter of 2018. The 23% decrease in contribution margin per ton
primarily resulted from lower sales price on Northern White volumes
as well as increased per ton production costs due to lower sales
volumes.
"The increase in volumes sold through our
PropStream logistics services and direct to operators benefited our
sales volumes and, to a certain extent, our contribution margin in
a challenging and rapidly evolving market landscape," said Ms.
Laura C. Fulton, Chief Financial Officer of Hi-Crush. “In response
to emerging pressures, we took proactive steps to control costs and
concentrate capacity utilization at certain of our Wisconsin
facilities, including our decision to idle the dry plant at
Whitehall in late September. We continue to focus on improvements
to our cost structure from the mine to the last mile, and on
establishing and deepening relationships with operators. Our
continued expansion of last mile solutions benefitted our results
in the quarter and positions us well to respond quickly to expected
market improvements spurred by alleviation of demand constraints
beginning in early 2019. Our integrated last mile solutions
mitigated some impacts from the market and pricing dynamics of
sand, as does our in-basin production capability. The performance
from our Kermit facility remains strong. We have been operating the
facility at or above nameplate capacity for more than a year, and
are pleased with its operations, which will continue to produce a
strong base of cash flows for us, and provide reliable supply to
our customers.”
Structural Simplification
On October 22, 2018 the Partnership announced it
had completed the acquisition of its sponsor, Hi-Crush Proppants
LLC, the sole member of its general partner, for consideration of
11.0 million newly issued common units of the Partnership. Total
value of the consideration for the acquisition, comprised entirely
of the newly issued units, was $96.25 million based on the closing
price of $8.75 per unit on October 19, 2018. Through the
acquisition, which closed on October 21, 2018, Hi-Crush simplified
its corporate structure, eliminated its incentive distribution
rights (“IDRs”) and associated reset provisions, cancelled
remaining potential earnout payments from previous asset dropdowns,
and acquired economic control of the Partnership from the general
partner. The terms of the agreement were the result of arm’s length
negotiation between the representatives of majority owner of the
sponsor and the Conflicts Committee, which is comprised solely of
the independent directors of Hi-Crush’s Board of Directors.
“We are excited to have reached an agreement and
complete the buyout of our sponsor and general partner,” said Mr.
Rasmus. “This transaction meaningfully simplifies our corporate
structure and advances our progress towards conversion from an MLP
to a C-Corp sooner than alternate paths. The transaction eliminates
the IDRs and a future IDR reset, preserving cash, while also
ensuring the interests of management and the unitholders are
strongly aligned. We believe the buyout will result in immediate
and long-term benefits for the Partnership as we continue the
transformation of our business. These benefits include a lower cost
of capital, increased appeal to a wider range of investors,
improved corporate governance, enhanced financial flexibility, and
ability to respond to the evolving dynamics of our business and
industry, generating value for all stakeholders.”
Operational Update
The acquisition of FB Industries Inc. ("FB
Industries" or "FB") closed on August 1, 2018. There are 69 legacy
FB Industries silo systems in the field today, with several in
inventory and in production. FB has recently completed
commissioning and is currently field testing the new FB Atlas
top-fill conveyor system utilizing hopper bottom trailers that are
capable of delivering 27 tons per truck load to the
wellsite.
At the end of the third quarter of 2018,
Hi-Crush had 16 PropStream container systems in the Permian Basin
and Marcellus / Utica plays, an increase from 14 systems at the end
of the second quarter of 2018.
"The customer feedback on the operations of our
teams at the wellsite has been tremendously positive," said Mr.
Rasmus. “We are on track to achieve our market penetration goals
for year-end. Customers are focused on the last mile value
proposition for increased 2019 activity levels and interest in our
FB silo systems has been robust. We have explored several ways in
which we can utilize this addition to our logistics and wellsite
storage offering to improve efficiencies and deliver further value
to our customers.”
“As of the end of the quarter, Hi-Crush had 16
of the 52 container systems developed by PropX that are currently
in the field,” said Ms. Fulton. “We expect nearly 60 PropX
container systems to be deployed by year-end, of which 20 will be
ready for operation by Hi-Crush personnel for our operator
customers. We will have 8 silo systems under lease arrangements in
November, with several in inventory ready to be deployed, and are
continuing to build more systems to put in service by
year-end.”
Liquidity and Capital
Expenditures
As of September 30, 2018, the Partnership
had $444.8 million of long-term debt outstanding, and was in
compliance with the covenants defined in its senior secured
revolving credit facility (the "ABL Facility"). As of
September 30, 2018, Hi-Crush had $175.4 million of cash and
$97.7 million in available capacity under its ABL Facility.
“Our balance sheet is well positioned for the
challenges we face,” said Ms. Fulton. “With nearly $275 million in
liquidity, including the $175 million of cash, we have more than
sufficient funding for our capital projects, our distribution and
debt service.”
Capital expenditures for the nine months ended
September 30, 2018, totaled $66.8 million. For the full year
2018, capital expenditures are expected to be in the range of $155
to $165 million. The 2018 plan includes the previously announced
development and construction of our second Kermit facility ("Kermit
2"), equipment builds to further expand market penetration of the
FB Industries silo solution, expansion of the Wyeville facility,
and further growth in PropStream and other logistics
initiatives.
"We are looking at every project to justify the
spending and conserve cash, however, the construction of our second
in-basin Permian facility on our reserves in Kermit, Texas, and the
expansion of the Wyeville facility in Wisconsin, continue as
planned,” said Ms. Fulton. “The expansion projects in West Texas
and Wisconsin are reflective of our strategic pivot to focus on the
needs of operators, and both expansions are supported by strong
commitments from new and existing E&P customers. In addition to
supplying sand at the minegate or in-basin, our last mile
capabilities deepen the value we provide to operators, and we
remain committed to expanding the ways in which we can serve those
customers. The second Kermit facility is supported by contracts
with operators for 75% of its capacity and is on track to be
completed by the end of 2018. The Wyeville expansion is fully
supported by customer commitments and is on schedule for completion
in mid-first quarter of 2019.”
Distribution
On October 21, 2018, Hi-Crush declared a
quarterly cash distribution of $0.225 per unit on all common units,
or $0.90 on an annualized basis, for the third quarter of 2018,
down from the previous quarterly cash distribution of $0.75 per
unit. The distribution will be paid on November 14, 2018, to
unitholders of record on November 1, 2018.
Outlook
For the fourth quarter of 2018, the Partnership
expects total sales volumes to be in a range of 2.3 to 2.5 million
tons. Volumes sold during the fourth quarter of 2018 are
expected to be negatively impacted by continued weakness in
completions activity, as well as typical seasonal
slowdowns. We anticipate increasing completions activity in
2019 along with refreshed E&P capital budgets, the availability
of newly-built takeaway capacity in the Permian Basin, and
improving supply/demand dynamics for frac sand.
"We believe some of the market dynamics that
coalesced in the third quarter are transitory,” said Mr. Rasmus.
“With some of these factors alleviating in early 2019 and
throughout the coming year, we fully expect a recovery in the
demand environment. There is evolving uncertainty regarding
Northern White sand and we are not immune to the pressures facing
the frac sand industry. However, we believe that our Mine. Move.
Manage. strategy and the customer approach we have communicated are
the keys to long-term success in the frac sand and logistics
sector. The potential commoditization of frac sand production
contributed to our original investment in the last mile. We are
committed to fundamentally reorienting our business beyond the
mine, including an increasing concentration on the logistics of
frac sand, and serving customers through value added
solutions.”
Conference Call
On Wednesday, October 31, 2018, Hi-Crush
will hold a conference call for investors at 7:30 a.m. Central Time
(8:30 a.m. Eastern Time) to discuss Hi-Crush’s third quarter 2018
results. Hosting the call will be Robert E. Rasmus, Chairman and
Chief Executive Officer and Laura C. Fulton, Chief Financial
Officer. The call can be accessed live over the telephone by
dialing (877) 407-0789, or for international callers, (201)
689-8562. A replay will be available shortly after the call and can
be accessed by dialing (844) 512-2921, or for international callers
(412) 317-6671. The passcode for the replay is 13683493. The replay
will be available until November 14, 2018.
Interested parties may also listen to a
simultaneous webcast of the conference call by logging onto
Hi-Crush’s website at www.hicrush.com under the Investors
Relations-Event Calendar and Presentations section. A replay of the
webcast will also be available for approximately 30 days following
the call. The slide presentation to be referenced on the call will
also be on Hi-Crush’s website at www.hicrush.com under the
Investors Relations-Event Calendar and Presentations section.
Non-GAAP Financial Measures
This news release and the accompanying schedules
include the non-GAAP financial measure of EBITDA, Adjusted EBITDA,
distributable cash flow, adjusted earnings per limited partner unit
and contribution margin, which may be used periodically by
management when discussing our financial results with investors and
analysts. The accompanying schedules of this news release provide
reconciliations of these non-GAAP financial measures to their most
directly comparable financial measures calculated and presented in
accordance with generally accepted accounting principles in the
United States of America ("GAAP").
We define EBITDA as net income plus
depreciation, depletion and amortization and interest expense, net
of interest income. We define Adjusted EBITDA as EBITDA, adjusted
for any non-cash impairments of long-lived assets and goodwill,
earnings (loss) from equity method investments and loss on
extinguishment of debt. We define distributable cash flow as
Adjusted EBITDA less cash paid for interest expense and maintenance
and replacement capital expenditures, including accrual for reserve
replacement, plus accretion of asset retirement obligations and
non-cash unit-based compensation. We use distributable cash flow as
a performance metric to compare cash generating performance of the
Partnership from period to period and to compare the cash
generating performance for specific periods to the cash
distributions (if any) that are expected to be paid to our
unitholders. Distributable cash flow will not reflect changes
in working capital balances. We define adjusted earnings per
limited partner unit as earnings per limited partner unit, adjusted
for the impact of non-recurring items.
We use contribution margin, which we define as
total revenues less costs of goods sold excluding depreciation,
depletion and amortization, to measure our financial and operating
performance. Contribution margin excludes other operating expenses
and income, including costs not directly associated with the
operations of our business such as accounting, human resources,
information technology, legal, sales and other administrative
activities.
EBITDA, Adjusted EBITDA, distributable cash
flow, adjusted earnings per limited partner unit and contribution
margin are presented as management believes the data provides a
measure of operating performance that is unaffected by historical
cost basis and provides additional information and metrics relative
to the performance of our business.
About Hi-Crush
Hi-Crush is a fully integrated, strategic
provider of proppant and logistics solutions to the North American
petroleum industry. We own and operate multiple frac sand mining
facilities and in-basin terminals, and provide mine-to-wellsite
logistics services that optimize proppant supply to customers in
all major basins. Our PropStream service, offering both container-
and silo-based wellsite delivery and storage systems, provides the
highest level of flexibility, safety and efficiency in managing the
full scope and value of the proppant supply chain. Visit
HiCrush.com.
Forward-Looking Statements
Some of the information in this news release may
contain forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act"). Forward-looking statements give our current expectations,
and contain projections of results of operations or of financial
condition, or forecasts of future events. Words such as "may,"
"should," "assume," "forecast," "position," "predict," "strategy,"
"expect," "intend," "hope," "plan," "estimate," "anticipate,"
"could," "believe," "project," "budget," "potential," "likely," or
"continue," and similar expressions are used to identify
forward-looking statements. They can be affected by assumptions
used or by known or unknown risks or uncertainties. Consequently,
no forward-looking statements can be guaranteed. When considering
these forward-looking statements, you should keep in mind the risk
factors and other cautionary statements in Hi-Crush’s reports filed
with the Securities and Exchange Commission (the "SEC"), including
those described under 1A of Hi-Crush’s Form 10-K for the year ended
December 31, 2017 and any subsequently filed 10-Q. Actual
results may vary materially. You are cautioned not to place undue
reliance on any forward-looking statements. You should also
understand that it is not possible to predict or identify all such
factors and should not consider the risk factors in our reports
filed with the SEC or the following list to be a complete statement
of all potential risks and uncertainties. Factors that could cause
our actual results to differ materially from the results
contemplated by such forward looking statements include: the volume
of frac sand we are able to sell; the price at which we are able to
sell frac sand; the outcome of any pending litigation, claims or
assessments, including unasserted claims; changes in the price and
availability of natural gas or electricity; changes in prevailing
economic conditions; and difficulty collecting receivables. All
forward-looking statements are expressly qualified in their
entirety by the foregoing cautionary statements. Hi-Crush’s
forward-looking statements speak only as of the date made and
Hi-Crush undertakes no obligation to update or revise its
forward-looking statements, whether as a result of new information,
future events or otherwise.
Investor contact:Caldwell
Bailey, Lead Investor Relations AnalystMarc Silverberg,
ICRir@hicrush.com(713) 980-627
Unaudited Condensed Consolidated Statements of
Operations(Amounts in thousands, except per unit
amounts)
|
Three Months Ended |
|
September 30, |
|
June 30, |
|
2018 |
|
2017 |
|
2018 |
Revenues |
$ |
213,972 |
|
|
$ |
167,583 |
|
|
$ |
248,520 |
|
Cost of goods sold
(excluding depreciation, depletion and amortization) |
147,583 |
|
|
119,955 |
|
|
154,531 |
|
Depreciation, depletion
and amortization |
10,241 |
|
|
8,805 |
|
|
10,482 |
|
Gross
profit |
56,148 |
|
|
38,823 |
|
|
83,507 |
|
Operating costs and
expenses: |
|
|
|
|
|
General
and administrative expenses |
16,266 |
|
|
9,583 |
|
|
12,616 |
|
Accretion
of asset retirement obligations |
124 |
|
|
115 |
|
|
123 |
|
Other
operating expenses |
631 |
|
|
200 |
|
|
184 |
|
Other
operating income |
— |
|
|
(3,554 |
) |
|
— |
|
Income
from operations |
39,127 |
|
|
32,479 |
|
|
70,584 |
|
Other income
(expense): |
|
|
|
|
|
Earnings
from equity method investments |
1,624 |
|
|
128 |
|
|
1,144 |
|
Interest
expense |
(7,973 |
) |
|
(2,800 |
) |
|
(3,720 |
) |
Loss on
extinguishment of debt |
(6,233 |
) |
|
— |
|
|
— |
|
Net
income |
$ |
26,545 |
|
|
$ |
29,807 |
|
|
$ |
68,008 |
|
Earnings per limited
partner unit: |
|
|
|
|
|
Basic |
$ |
0.30 |
|
|
$ |
0.33 |
|
|
$ |
0.68 |
|
Diluted |
$ |
0.29 |
|
|
$ |
0.32 |
|
|
$ |
0.67 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended |
|
September 30, |
|
2018 |
|
2017 |
Revenues |
$ |
680,605 |
|
|
$ |
386,167 |
|
Cost of goods sold (excluding depreciation, depletion and
amortization) |
444,097 |
|
|
291,920 |
|
Depreciation, depletion and amortization |
28,522 |
|
|
21,229 |
|
Gross profit |
207,986 |
|
|
73,018 |
|
Operating costs and expenses: |
|
|
|
General and administrative expenses |
39,822 |
|
|
28,221 |
|
Accretion of asset retirement obligations |
373 |
|
|
343 |
|
Other operating expenses |
1,836 |
|
|
343 |
|
Other operating income |
— |
|
|
(3,554 |
) |
Income from operations |
165,955 |
|
|
47,665 |
|
Other income (expense): |
|
|
|
Earnings (loss) from equity method investments |
3,934 |
|
|
(142 |
) |
Interest expense |
(15,154 |
) |
|
(8,167 |
) |
Loss on extinguishment of debt |
(6,233 |
) |
|
— |
|
Net income |
$ |
148,502 |
|
|
$ |
39,356 |
|
Earnings per limited partner unit: |
|
|
|
Basic |
$ |
1.67 |
|
|
$ |
0.48 |
|
Diluted |
$ |
1.64 |
|
|
$ |
0.47 |
|
|
|
|
|
|
|
|
|
Unaudited EBITDA, Adjusted EBITDA and Distributable Cash
Flow(Amounts in thousands)
|
Three Months
Ended |
|
September 30, |
|
June 30, |
|
2018 |
|
2017 |
|
2018 |
Reconciliation of distributable cash flow to net
income: |
|
|
|
|
|
Net income |
$ |
26,545 |
|
|
$ |
29,807 |
|
|
$ |
68,008 |
|
Depreciation and depletion expense |
10,241 |
|
|
8,806 |
|
|
10,482 |
|
Amortization expense |
1,215 |
|
|
421 |
|
|
420 |
|
Interest expense |
7,973 |
|
|
2,800 |
|
|
3,720 |
|
EBITDA |
45,974 |
|
|
41,834 |
|
|
82,630 |
|
Earnings from equity method investments |
(1,624 |
) |
|
(128 |
) |
|
(1,144 |
) |
Loss on extinguishment of debt |
6,233 |
|
|
— |
|
|
— |
|
Adjusted EBITDA |
50,583 |
|
|
41,706 |
|
|
81,486 |
|
Less: Cash interest paid |
(7,649 |
) |
|
(2,427 |
) |
|
(3,477 |
) |
Less: Maintenance and replacement capital
expenditures, including accrual for reserve replacement (a) |
(4,914 |
) |
|
(3,399 |
) |
|
(5,561 |
) |
Add: Accretion of asset retirement obligations |
124 |
|
|
115 |
|
|
123 |
|
Add: Unit-based compensation |
1,897 |
|
|
1,509 |
|
|
1,810 |
|
Distributable cash flow |
40,041 |
|
|
37,504 |
|
|
74,381 |
|
Less: Distributable cash flow attributable to the
holder of incentive distribution rights |
— |
|
|
— |
|
|
(7,821 |
) |
Distributable cash flow attributable to limited
partner unitholders |
$ |
40,041 |
|
|
$ |
37,504 |
|
|
$ |
66,560 |
|
|
|
(a) |
Maintenance
and replacement capital expenditures, including accrual for reserve
replacement, were determined based on an estimated reserve
replacement cost of $1.35 per ton produced and delivered through
September 30, 2017. Effective October 1, 2017, we increased
the estimated reserve replacement cost to $1.85 per ton produced
and delivered, due to the addition of our Kermit facility. We
expect to revise our estimated reserve replacement cost as of
January 1, 2019 upon completion of the Kermit 2 facility
construction. Such expenditures include those associated with
the replacement of equipment and sand reserves, to the extent that
such expenditures are made to maintain our long-term operating
capacity. The amount presented does not represent an actual reserve
account or requirement to spend the capital. |
|
|
Unaudited EBITDA, Adjusted EBITDA and Distributable Cash
Flow(Amounts in thousands)
|
Nine Months
Ended |
|
September 30, |
|
2018 |
|
2017 |
Reconciliation of distributable cash flow to net
income: |
|
|
|
Net income |
$ |
148,502 |
|
|
$ |
39,356 |
|
Depreciation and depletion expense |
28,522 |
|
|
21,234 |
|
Amortization expense |
2,056 |
|
|
1,262 |
|
Interest expense |
15,154 |
|
|
8,167 |
|
EBITDA |
194,234 |
|
|
70,019 |
|
(Earnings) loss from equity method investments |
(3,934 |
) |
|
142 |
|
Loss on extinguishment of debt |
6,233 |
|
|
— |
|
Adjusted EBITDA |
196,533 |
|
|
70,161 |
|
Less: Cash interest paid |
(14,392 |
) |
|
(7,049 |
) |
Less: Maintenance and replacement capital
expenditures, including accrual for reserve replacement (a) |
(15,150 |
) |
|
(8,189 |
) |
Add: Accretion of asset retirement obligations |
373 |
|
|
343 |
|
Add: Unit-based compensation |
5,508 |
|
|
3,906 |
|
Distributable cash flow |
172,872 |
|
|
59,172 |
|
Adjusted for: Distributable cash flow attributable
to assets contributed by the sponsor, prior to the period in which
the contribution occurred (b) |
— |
|
|
1,247 |
|
Distributable cash flow attributable to Hi-Crush Partners LP |
172,872 |
|
|
60,419 |
|
Less: Distributable cash flow attributable to the
holder of incentive distribution rights |
(7,664 |
) |
|
— |
|
Distributable cash flow attributable to limited
partner unitholders |
$ |
165,208 |
|
|
$ |
60,419 |
|
|
|
(a) |
Maintenance
and replacement capital expenditures, including accrual for reserve
replacement, were determined based on an estimated reserve
replacement cost of $1.35 per ton produced and delivered through
September 30, 2017. Effective October 1, 2017, we increased
the estimated reserve replacement cost to $1.85 per ton produced
and delivered, due to the addition of our Kermit facility. We
expect to revise our estimated reserve replacement cost as of
January 1, 2019 upon completion of the Kermit 2 facility
construction. Such expenditures include those associated with
the replacement of equipment and sand reserves, to the extent that
such expenditures are made to maintain our long-term operating
capacity. The amount presented does not represent an actual reserve
account or requirement to spend the capital. |
(b) |
The
Partnership's historical financial information has been recast to
consolidate Hi-Crush Blair LLC, Hi-Crush Whitehall LLC and Other
Assets for the periods leading up to their contribution into the
Partnership. For purposes of calculating distributable cash
flow attributable to Hi-Crush Partners LP, the Partnership excludes
the incremental amount of recast distributable cash flow earned
during the periods prior to the contributions. |
|
|
Unaudited Condensed Consolidated Cash Flow
Information(Amounts in thousands)
|
Nine Months
Ended |
|
September 30, |
|
2018 |
|
2017 |
Operating activities |
$ |
187,740 |
|
|
$ |
63,073 |
|
Investing activities |
(106,663 |
) |
|
(453,106 |
) |
Financing activities |
88,691 |
|
|
409,418 |
|
Net increase in cash |
$ |
169,768 |
|
|
$ |
19,385 |
|
|
|
|
|
|
|
|
|
Unaudited Condensed Consolidated
Balance Sheets(Amounts in thousands, except unit
amounts)
|
September
30,2018 |
|
December
31,2017 |
Assets |
|
|
|
Current assets: |
|
|
|
Cash |
$ |
175,430 |
|
|
$ |
5,662 |
|
Accounts receivable, net |
122,897 |
|
|
139,448 |
|
Inventories |
73,037 |
|
|
44,272 |
|
Prepaid expenses and other current assets |
9,060 |
|
|
2,832 |
|
Total current assets |
380,424 |
|
|
192,214 |
|
Property, plant and equipment, net |
951,158 |
|
|
899,158 |
|
Intangible assets, net |
70,008 |
|
|
8,416 |
|
Equity method investments |
29,504 |
|
|
17,475 |
|
Other assets |
8,246 |
|
|
5,877 |
|
Total assets |
$ |
1,439,340 |
|
|
$ |
1,123,140 |
|
Liabilities and Partners’ Capital |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
60,537 |
|
|
$ |
46,794 |
|
Accrued and other current liabilities |
54,349 |
|
|
29,931 |
|
Current portion of deferred revenues |
19,840 |
|
|
4,399 |
|
Due to sponsor |
5,345 |
|
|
12,399 |
|
Current portion of long-term debt |
790 |
|
|
2,957 |
|
Total current liabilities |
140,861 |
|
|
96,480 |
|
Deferred revenues |
3,241 |
|
|
7,384 |
|
Long-term debt |
443,974 |
|
|
194,462 |
|
Asset retirement obligations |
10,552 |
|
|
10,179 |
|
Other liabilities |
8,464 |
|
|
19,000 |
|
Total liabilities |
607,092 |
|
|
327,505 |
|
Commitments and contingencies |
|
|
|
Partners' capital: |
|
|
|
General partner interest |
— |
|
|
— |
|
Limited partners interest, 89,866,063 and 89,009,188
units outstanding, respectively |
832,248 |
|
|
795,635 |
|
Total partners’ capital |
832,248 |
|
|
795,635 |
|
Total liabilities and partners’ capital |
$ |
1,439,340 |
|
|
$ |
1,123,140 |
|
|
|
|
|
|
|
|
|
Unaudited Per Ton Operating Activity(Amounts in
thousands, except tons and per ton amounts)
|
Three Months
Ended |
|
September 30, |
|
June 30, |
|
2018 |
|
2017 |
|
2018 |
Sand sold |
2,775,360 |
|
|
2,456,195 |
|
|
3,037,504 |
|
Sand produced and delivered |
2,655,831 |
|
|
2,517,752 |
|
|
3,006,091 |
|
Contribution margin |
$ |
66,389 |
|
|
$ |
47,628 |
|
|
$ |
93,989 |
|
Contribution margin per ton sold |
$ |
23.92 |
|
|
$ |
19.39 |
|
|
$ |
30.94 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended |
|
September 30, |
|
2018 |
|
2017 |
Sand sold |
8,430,491 |
|
|
5,953,598 |
|
Sand produced and delivered |
8,188,959 |
|
|
6,065,840 |
|
Contribution margin |
$ |
236,508 |
|
|
$ |
94,247 |
|
Contribution margin per ton sold |
$ |
28.05 |
|
|
$ |
15.83 |
|
|
|
|
|
|
|
|
|
Unaudited Net Income per Limited Partner
Unit(Amounts in thousands, except units and per unit
amounts)
|
Three Months
Ended |
|
Nine Months
Ended |
|
September
30, |
|
September
30, |
Weighted average limited partner units
outstanding: |
2018 |
|
2017 |
|
2018 |
|
2017 |
Basic common units outstanding |
89,277,833 |
|
|
91,030,558 |
|
|
88,848,290 |
|
|
85,277,011 |
|
Potentially dilutive common units |
1,536,881 |
|
|
997,066 |
|
|
1,536,881 |
|
|
997,066 |
|
Diluted common units outstanding |
90,814,714 |
|
|
92,027,624 |
|
|
90,385,171 |
|
|
86,274,077 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of net income and the assumed
allocation of net income under the two-class method for purposes of
computing earnings per limited partner unit:
|
Three Months Ended
September 30, 2018 |
|
General Partnerand
IDRs |
|
Limited
PartnerUnits |
|
Total |
Declared distribution |
$ |
— |
|
|
$ |
22,695 |
|
|
$ |
22,695 |
|
Assumed allocation of distribution in excess of earnings |
— |
|
|
3,850 |
|
|
3,850 |
|
Assumed allocation of net income |
$ |
— |
|
|
$ |
26,545 |
|
|
$ |
26,545 |
|
|
|
|
|
|
|
Earnings per limited partner unit - basic |
|
|
$ |
0.30 |
|
|
|
Earnings per limited partner unit - diluted |
|
|
$ |
0.29 |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
September 30, 2017 |
|
General Partnerand
IDRs |
|
Limited
PartnerUnits |
|
Total |
Declared distribution |
$ |
— |
|
|
$ |
13,655 |
|
|
$ |
13,655 |
|
Assumed allocation of earnings in excess of distribution |
— |
|
|
16,152 |
|
|
16,152 |
|
Assumed allocation of net income |
$ |
— |
|
|
$ |
29,807 |
|
|
$ |
29,807 |
|
|
|
|
|
|
|
Earnings per limited partner unit - basic |
|
|
$ |
0.33 |
|
|
|
Earnings per limited partner unit - diluted |
|
|
$ |
0.32 |
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September
30, 2018 |
|
General Partnerand
IDRs |
|
Limited
PartnerUnits |
|
Total |
Declared distribution |
$ |
7,664 |
|
|
$ |
109,836 |
|
|
$ |
117,500 |
|
Assumed allocation of earnings in excess of distributions |
(7,228 |
) |
|
38,230 |
|
|
31,002 |
|
Assumed allocation of net income |
$ |
436 |
|
|
$ |
148,066 |
|
|
$ |
148,502 |
|
|
|
|
|
|
|
Earnings per limited partner unit - basic |
|
|
$ |
1.67 |
|
|
|
Earnings per limited partner unit - diluted |
|
|
$ |
1.64 |
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September
30, 2017 |
|
General Partnerand
IDRs |
|
Limited
PartnerUnits |
|
Total |
Declared distribution |
$ |
— |
|
|
$ |
13,655 |
|
|
$ |
13,655 |
|
Assumed allocation of earnings in excess of distributions |
— |
|
|
25,701 |
|
|
25,701 |
|
Add back recast losses attributable to Whitehall and Other Assets
through March 15, 2017 |
— |
|
|
1,471 |
|
|
1,471 |
|
Assumed allocation of net income |
$ |
— |
|
|
$ |
40,827 |
|
|
$ |
40,827 |
|
|
|
|
|
|
|
Earnings per limited partner unit - basic |
|
|
$ |
0.48 |
|
|
|
Earnings per limited partner unit - diluted |
|
|
$ |
0.47 |
|
|
|
|
|
|
|
|
|
|
|
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