Select Sands Corp announced financial and operational results for the second quarter of 2017. Revenue more than doubled to $3.1 million CAD from $1.5 million in the first quarter 2017. Second quarter revenue would have been greater, except for lost sales volumes of 8,000 to 12,000 tons due to a pause in shipping during the May flood in Arkansas, and the installation of a vertical shaft impact crusher at the Freeze Farm Wet Processing Facility.
Second quarter 2017 sales volumes for total frac and industrial sand increased 136 percent from the first quarter.
Gross margin for the company’s Sand Operations was $0.8 million, a substantial improvement over the gross margin loss of $0.4 million during this year’s first quarter. Comprehensive loss decreased more than 75 percent to $0.8 million, or $0.01 basic and diluted loss per common share, as compared to a first quarter 2017 comprehensive loss of $3.4 million, or $0.04 basic and diluted loss per common share. These results included non-cash share-based compensation of $0.6 million and $2.2 million for the second and first quarters, respectively.
Included in first quarter capital spending was $1.3 million for the purchase of the Bell Farm Property. As of June 30, 2017, cash and cash equivalents were $3.4 million, inventory on hand was $2.3 million and accounts receivable was $3.1 million. The primary driver of the $1.7 million increase in accounts receivable from the $1.4 million balance as of March 31, 2017, was the rapid growth in sales in the latter part of the second quarter
Zig Vitols, president and chief executive officer, commented, “Considering that we only began commercial production at the beginning of this year and the impact of flooding during May, I am extremely pleased with our results for the second quarter. Driving our results was the hard work of our employees and I want to personally thank all of them for their continued dedication and efforts.”
Select Sands continues to see strong demand for its Northern White frac sand product due to its premium quality and the strategic location of the company’s operations relatively close to the oil and gas basins in Texas, Oklahoma, Colorado and Louisiana. The enhanced economics provided by improving technologies for drilling and completing horizontal wells (more wells drilled per rig, longer lateral lengths, more frac stages per foot, and more sand per frac stage) is driving increased use of frac sand and the company anticipates frac sand intensity and demand will continue to grow.