U.S. Silica Holdings Inc announced its third quarter results for the period ended Sept. 30, reporting that net income for the third quarter was $26.9 million, or $0.34 per diluted share. The third quarter results were impacted by $3.8 million pre-tax, or $0.04 per diluted share after-tax, of charges primarily related to a non-recurring adjustment to depreciation and the loss on extinguishment of debt, resulting in adjusted EPS (a non-GAAP measure) of $0.38 per diluted share.
These results compared with net income of $46.3 million, or $0.59 per diluted share, for the second quarter of 2023, which was impacted by $1.4 million pre-tax, or $0.01 per diluted share after-tax, of charges primarily related to the loss on extinguishment of debt, resulting in adjusted EPS (a non-GAAP measure) of $0.60 per diluted share.
Ton sold came in at 4.121 million, versus 4.459 million in the second quarter, an 8% decrease; and 4.624 million in the second quarter of 2022, an 11% decrease.
“During the third quarter, we continued to advance our two-pronged growth strategy of expanding our Industrial & Specialty Products segment while strengthening our financial foundation,” said Bryan Shinn, the company’s chief executive officer. “We generated healthy cash flow from operations and Adjusted EBITDA, driven by strong customer demand compared to historical averages and supported by our lean cost structure. We also repurchased and extinguished an additional $25 million of debt, improving our balance sheet and leverage profile.
“In our Oil & Gas segment, the sequential decrease in drilling and completions activity drove lower demand for our products and services across all basins. Despite this, our financial results were strong compared to historical averages as pricing remained attractive and our cost reduction efforts helped to maintain high margin levels. Additionally, our new, patent-pending Guardian frac fluid filtration system is performing well and gaining momentum in the market. Frac companies that have trialed the Guardian are achieving positive outcomes through increased pump uptime and improved pump efficiency, with lower repair and maintenance costs.
“As we guided on last quarter’s call, our Industrial & Specialty Products segment’s volumes declined year-over-year due to mild economic softness, particularly for building products, diatomaceous earth fillers and filtration, and certain glass customers that performed maintenance projects after several years of high demand. Even so, we benefited from ongoing structural cost reductions along with improved product mix from sales to new markets, applications and products, as well as price increases, all of which enabled us to maintain year-over-year profitability levels.
“The strong results we’ve reported year-to-date give us reasonable confidence in reaffirming our full-year 2023 guidance. Furthermore, our customer contracts, coupled with expected incremental cost and productivity improvements, provide strong visibility for the remainder of this year. We continue to expect Adjusted EBITDA to increase approximately 25% year-over-year, with robust cash flow from operations of approximately $265 million this year, while maintaining our strong leverage profile,” Shin concluded.