Third Quarter 2018 Highlights
-
Net income of $26.4 million; 23% increase versus second quarter 2018
and up 257% year-over-year
-
Adjusted EBITDA of $36.5 million; 21% increase versus second quarter
2018 and up 226% year-over-year
-
Revenue of $56.7 million; 20% increase versus second quarter 2018 and
up 207% year-over-year
-
11,848 revenue days; 20% increase versus second quarter 2018 and up
159% year-over-year
-
Added 24 proppant management systems to the rental fleet; total of 146
systems at quarter-end
HOUSTON--(BUSINESS WIRE)--
Solaris Oilfield Infrastructure, Inc. (NYSE:SOI) (“Solaris” or the
“Company”), a leading independent provider of supply chain management
and logistics solutions designed to drive efficiencies and reduce costs
for the oil and natural gas industry, today reported financial results
for the third quarter 2018.
Third Quarter 2018 Financial Review
Solaris reported net income of $26.4 million, or $0.49 per diluted Class
A share, for third quarter 2018, compared to net income of $21.4
million, or $0.40 per diluted Class A share, in second quarter 2018 and
net income of $7.4 million, or $0.12 per diluted Class A share, in third
quarter 2017.
Adjusted EBITDA for third quarter 2018 was $36.5 million, an increase of
$6.5 million compared to second quarter 2018 and an increase of $25.3
million from third quarter 2017. A description of adjusted EBITDA and a
reconciliation to net income, its most directly comparable GAAP measure,
is provided below.
Adjusted pro forma net income for third quarter 2018 was $24.0 million,
or $0.51 per fully exchanged and diluted share, an increase of $4.3
million and $0.09 per fully exchanged and diluted share from second
quarter 2018 and an increase of $18.6 million and $0.38 per fully
exchanged and diluted share compared to third quarter 2017. A
description of adjusted pro forma net income and a reconciliation to net
income attributable to Solaris, its most directly comparable GAAP
measure, and the computation of adjusted pro forma earnings per fully
exchanged and diluted share are provided below.
Revenues were $56.7 million for third quarter 2018, an increase of $9.5
million, or 20%, compared to second quarter 2018, and an increase of
$38.2 million, or 207%, compared to third quarter 2017.
During third quarter 2018, the Company generated 11,848 revenue days,
the combined number of days that its systems earned revenue during the
quarter, a 20% increase from second quarter 2018, and up 159% compared
to third quarter 2017. Customer demand and adoption rates for Solaris’
systems continue to grow as proppant consumption and intensity increase
across the industry and customers realize the benefits of Solaris’
technology.
Capital Expenditures and Liquidity
Driven by strong customer demand and continued customer adoption of its
products and services, the Company invested $38.8 million during third
quarter 2018, which included adding 24 mobile proppant management
systems to the fleet, ending the quarter with 146 systems. These
investments help address rising customer demand and are expected to
drive future earnings and cash flow growth for Solaris.
As of September 30, 2018, the Company had approximately $64.1 million of
liquidity, including $2.1 million in cash and $62.0 million of
availability under its credit facility, net of $8.0 million of
outstanding borrowings.
Operational Update and Outlook
Solaris ended October 2018 with 152 mobile proppant management systems
deployed in the rental fleet. The Company’s most active operating areas
continue to be the Delaware Basin, Eagle Ford Shale and Midland Basin,
followed by the SCOOP/STACK formation, the Marcellus/Utica Shale, the
Haynesville Shale, the Rockies and the Barnett Shale. The Company’s
systems are highly mobile and can be deployed quickly in response to
customer demand.
Based on current industry activity levels, the Company believes it has
approximately 1/3 of overall U.S. market share which represents the
leading share for mobile proppant handling solutions. Secular increases
in proppant consumption rates, supply chain disruptions and logistics
complexities continue to drive demand for Solaris’ products and
services. Based on its current manufacturing outlook, the Company
expects to end the fourth quarter with 160 to 162 mobile proppant
management systems and three mobile chemical management systems in the
fleet. Solaris continues to enhance its supply chain management
offerings through software development, automation and additional
products and services.
Solaris’ Chairman and Chief Executive Officer Bill Zartler commented,
“Our growth in the third quarter of 2018 highlights the value we provide
to our customers as they manage growing complexities around
manufacturing-type operations such as multi-well pad developments and
zipper fracs. While we are not immune to the temporary completion
headwinds in the lower-48, including infrastructure bottlenecks and
budget exhaustion, we believe Solaris will continue to outperform
overall industry activity levels by providing innovative, reliable, safe
and cost saving solutions to our customers.”
Conference Call
The Company will host a conference call to discuss its third quarter
2018 results on Thursday, November 1, 2018 at 7:30 a.m. Central Time
(8:30 a.m. Eastern Time). To join the conference call from within the
United States, participants may dial (844) 413-3978. To join the
conference call from outside of the United States, participants may dial
(412) 317-6594. When instructed, please ask the operator to be joined to
the Solaris Oilfield Infrastructure, Inc. call. Participants are
encouraged to log in to the webcast or dial in to the conference call
approximately ten minutes prior to the start time. To listen via live
webcast, please visit the Investor Relations section of the Company’s
website, http://www.solarisoilfield.com.
An audio replay of the conference call will be available shortly after
the conclusion of the call and will remain available for approximately
seven days. It can be accessed by dialing (877) 344-7529 within the
United States or (412) 317-0088 outside of the United States. The
conference call replay access code is 10124512. The replay will also be
available in the Investor Relations section of the Company’s website
shortly after the conclusion of the call and will remain available for
approximately seven days.
About Solaris Oilfield Infrastructure, Inc.
Solaris Oilfield Infrastructure, Inc. (NYSE:SOI) manufactures and rents
mobile equipment that drives supply chain and execution efficiencies in
the completion of oil and natural gas wells. Solaris’ patented mobile
proppant management systems are deployed in many of the most active oil
and natural gas basins in the United States, including the Permian
Basin, the Eagle Ford Shale, the STACK/SCOOP formation, the Marcellus
and Utica Shales, the Haynesville Shale, the Rockies and the Barnett
Shale. Solaris’ high-capacity transload facility in Kingfisher, Oklahoma
serves customers with operations in the STACK/SCOOP formation.
Additional information is available on the Solaris’ website, www.solarisoilfield.com.
Website Disclosure
We use our website (www.solarisoilfield.com)
as a routine channel of distribution of company information, including
news releases, analyst presentations, and supplemental financial
information, as a means of disclosing material non-public information
and for complying with our disclosure obligations under SEC Regulation
FD. Accordingly, investors should monitor our website in addition to
following press releases, SEC filings and public conference calls and
webcasts. Additionally, we provide notifications of news or
announcements on our investor relations website. Investors and others
can receive notifications of new information posted on our investor
relations website in real time by signing up for email alerts.
None of the information provided on our website, in our press releases,
public conference calls and webcasts, or through social media channels
is incorporated by reference into, or deemed to be a part of, this
Current Report on Form 8-K or will be incorporated by reference into any
other report or document we file with the SEC unless we expressly
incorporate any such information by reference, and any references to our
website are intended to be inactive textual references only.
Forward Looking Statements
This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934. Examples of forward-looking
statements include, but are not limited to, statements we make regarding
management changes, the outlook for the operation of our Kingfisher
Facility, current and potential future long-term contracts and our
future business and financial performance. Forward-looking statements
are based on our current expectations and assumptions regarding our
business, the economy and other future conditions. Because
forward-looking statements relate to the future, by their nature, they
are subject to inherent uncertainties, risks and changes in
circumstances that are difficult to predict. As a result, our actual
results may differ materially from those contemplated by the
forward-looking statements. Factors that could cause our actual results
to differ materially from the results contemplated by such
forward-looking statements include, but are not limited to the factors
discussed or referenced in our filings made from time to time with the
SEC. Readers are cautioned not to place undue reliance on
forward-looking statements, which speak only as of the date hereof.
Factors or events that could cause our actual results to differ may
emerge from time to time, and it is not possible for us to predict all
of them. We undertake no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future developments or otherwise, except as may be required by law.
|
|
| | |
| | |
| | |
| | |
| | |
SOLARIS OILFIELD INFRASTRUCTURE, INC AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) |
| | | | | | | | | | | | | | | |
|
| | | Three Months Ended | | Nine Months Ended |
| | | September 30, | | June 30, | | September 30, |
| | | 2018 | | 2017 | | 2018 | | 2018 | | 2017 |
| Revenue | | | | | | | | | | | | | | | | |
|
Proppant system rental
| | |
$
|
42,031
| | |
$
|
15,062
| | |
$
|
35,127
| | |
$
|
104,563
| | |
$
|
34,560
| |
|
Proppant system services
| | | |
12,053
| | | |
3,416
| | | |
9,937
| | | |
29,499
| | | |
7,631
| |
|
Transloading services
| | | |
2,000
| | | |
—
| | | |
1,397
| | | |
3,847
| | | |
—
| |
|
Proppant inventory software services
| | |
|
602
|
| |
|
—
|
| |
|
694
|
| |
|
1,950
|
| |
|
—
|
|
|
Total revenue
| | | |
56,686
| | | |
18,478
| | | |
47,155
| | | |
139,859
| | | |
42,191
| |
| Operating costs and expenses | | | | | | | | | | | | | | | | |
|
Cost of proppant management system rental (excluding $4,133, $1,523
and $3,359 of depreciation and amortization for the three months
ended September 30, 2018 and 2017 and June 30, 2018, respectively,
and $10,128 and $3,748 of depreciation and amortization for the nine
months ended September 30, 2018 and 2017, respectively, shown
separately)
| | | |
1,949
| | | |
641
| | | |
1,683
| | | |
5,050
| | | |
1,588
| |
|
Cost of proppant management system services (excluding $347, $129
and $305 of depreciation and amortization for the three months ended
September 30, 2018 and 2017 and June 30, 2018, respectively, and
$889 and $283 of depreciation and amortization for the nine months
ended September 30, 2018 and 2017, respectively, shown separately)
| | | |
13,906
| | | |
3,933
| | | |
11,679
| | | |
34,691
| | | |
8,640
| |
|
Cost of transloading services (excluding $529 and $10 of
depreciation and amortization for the three months ended September
30, 2018 and June 30, 2018, respectively, and $544 of depreciation
and amortization for the nine months ended September 30, 2018, shown
separately)
| | | |
597
| | | |
—
| | | |
535
| | | |
1,464
| | | |
—
| |
|
Cost of proppant inventory software services (excluding $193 and
$193 of depreciation and amortization for the three months ended
September 30, 2018 and June 30, 2018, respectively, and $598 of
depreciation and amortization for the nine months ended September
30, 2018, shown separately)
| | | |
191
| | | |
—
| | | |
167
| | | |
614
| | | |
—
| |
|
Depreciation and amortization
| | | |
5,328
| | | |
1,742
| | | |
3,984
| | | |
12,514
| | | |
4,276
| |
|
Salaries, benefits and payroll taxes
| | | |
2,182
| | | |
2,942
| | | |
3,169
| | | |
7,972
| | | |
5,687
| |
Selling, general and administrative (excluding $126, $90 and $117
of depreciation and amortization for the three months ended
September 30, 2018 and 2017 and June 30, 2018, respectively, and
$355 and $245 of depreciation and amortization for the nine months
ended September 30, 2018 and 2017, respectively, shown separately)
| | | |
1,687
| | | |
1,176
| | | |
1,123
| | | |
4,690
| | | |
3,653
| |
|
Other operating expenses
| | |
|
56
|
| |
|
(38
|
)
| |
|
19
|
| |
|
1,752
|
| |
|
3,770
|
|
|
Total operating cost and expenses
| | |
|
25,896
|
| |
|
10,396
|
| |
|
22,359
|
| |
|
68,747
|
| |
|
27,614
|
|
|
Operating income
| | | |
30,790
| | | |
8,082
| | | |
24,796
| | | |
71,112
| | | |
14,577
| |
|
Interest expense, net
| | | |
(116
|
)
| | |
(27
|
)
| | |
(71
|
)
| | |
(271
|
)
| | |
(71
|
)
|
|
Other expense
| | |
|
—
|
| |
|
(32
|
)
| |
|
—
|
| |
|
—
|
| |
|
(119
|
)
|
|
Total other income (expense)
| | |
|
(116
|
)
| |
|
(59
|
)
| |
|
(71
|
)
| |
|
(271
|
)
| |
|
(190
|
)
|
|
Income before income tax expense
| | | |
30,674
| | | |
8,023
| | | |
24,725
| | | |
70,841
| | | |
14,387
| |
|
Provision for income taxes
| | |
|
4,237
|
| |
|
617
|
| |
|
3,277
|
| |
|
9,541
|
| |
|
1,137
|
|
|
Net income
| | | |
26,437
| | | |
7,406
| | | |
21,448
| | | |
61,300
| | | |
13,250
| |
|
Less: net (income) loss related to Solaris LLC
| | | |
—
| | | |
—
| | | |
—
| | | |
—
| | | |
(3,665
|
)
|
|
Less: net income related to non-controlling interests
| | |
|
(13,418
|
)
| |
|
(6,027
|
)
| |
|
(10,851
|
)
| |
|
(31,754
|
)
| |
|
(8,049
|
)
|
|
Net income attributable to Solaris
| | |
$
|
13,019
|
| |
$
|
1,379
|
| |
$
|
10,597
|
| |
$
|
29,546
|
| |
$
|
1,536
|
|
| | |
|
| |
|
| |
|
| |
|
| |
|
|
|
Earnings per share of Class A common stock - basic (1)
| | |
$
|
0.49
|
| |
$
|
0.13
|
| |
$
|
0.40
|
| |
$
|
1.13
|
| |
$
|
0.14
|
|
|
Earnings per share of Class A common stock - diluted (1)
| | |
$
|
0.49
|
| |
$
|
0.12
|
| |
$
|
0.40
|
| |
$
|
1.12
|
| |
$
|
0.14
|
|
| | | | | | | | | | | | | | | |
|
|
Basic weighted average shares of Class A common stock outstanding (1)
| | | |
26,197
| | | |
10,100
| | | |
25,541
| | | |
25,216
| | | |
10,100
| |
|
Diluted weighted average shares of Class A common stock outstanding
(1)
| | | |
26,329
| | | |
10,563
| | | |
25,711
| | | |
25,380
| | | |
10,552
| |
|
|
|
(1) – Represents earnings per share of Class A common stock and
weighted average shares of Class A common stock outstanding for the
period following the initial public offering (“IPO”).
|
|
|
| | |
|
| | |
SOLARIS OILFIELD INFRASTRUCTURE, INC AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) |
| | | | | | | |
|
| | | September 30, | | | December 31, |
| | | 2018 | | | 2017 |
| Assets | | | | | | | | |
|
Current assets:
| | | | | | | | |
|
Cash
| | |
$
|
2,077
| | | |
$
|
63,421
| |
|
Accounts receivable, net
| | | |
34,578
| | | | |
12,979
| |
|
Prepaid expenses and other current assets
| | | |
8,473
| | | | |
3,622
| |
|
Inventories
| | |
|
8,575
|
| | |
|
7,532
|
|
|
Total current assets
| | | |
53,703
| | | | |
87,554
| |
|
Property, plant and equipment, net
| | | |
269,033
| | | | |
151,163
| |
|
Goodwill
| | | |
17,236
| | | | |
17,236
| |
|
Intangible assets, net
| | | |
4,735
| | | | |
5,335
| |
|
Deferred tax assets
| | | |
26,588
| | | | |
25,512
| |
|
Other assets
| | |
|
1,529
|
| | |
|
260
|
|
|
Total assets
| | |
$
|
372,824
|
| | |
$
|
287,060
|
|
| Liabilities and Stockholders' Equity | | | | | | | | |
|
Current liabilities:
| | | | | | | | |
|
Accounts payable
| | |
$
|
5,993
| | | |
$
|
5,000
| |
|
Accrued liabilities
| | | |
15,408
| | | | |
15,468
| |
|
Current portion of insurance premium financing
| | | |
874
| | | | |
—
| |
|
Current portion of capital lease obligations
| | | |
35
| | | | |
33
| |
|
Other current liabilities
| | |
|
75
|
| | |
|
—
|
|
|
Total current liabilities
| | |
|
22,385
|
| | |
|
20,501
|
|
|
Senior secured credit facility
| | | |
8,000
| | | | |
—
| |
|
Capital lease obligations, net of current portion
| | | |
162
| | | | |
179
| |
|
Payables related to Tax Receivable Agreement
| | | |
52,866
| | | | |
24,675
| |
|
Other long-term liabilities
| | |
|
663
|
| | |
|
145
|
|
|
Total liabilities
| | |
|
84,076
|
| | |
|
45,500
|
|
|
Commitments and contingencies
| | | | | | | | |
|
Stockholders' equity
| | | | | | | | |
|
Preferred stock, $0.01 par value, 50,000 shares authorized, none
issued and outstanding
| | | |
—
| | | | |
—
| |
|
Class A common stock, $0.01 par value, 600,000 shares authorized,
26,607 issued and 26,516 outstanding as of September 30, 2018 and
19,026 issued and 19,010 outstanding as of December 31, 2017
| | | |
266
| | | | |
190
| |
|
Class B common stock, $0.00 par value, 180,000 shares authorized,
20,110 shares issued and outstanding as of September 30, 2018 and
26,811 issued and outstanding as of December 31, 2017
| | | |
—
| | | | |
—
| |
|
Additional paid-in capital
| | | |
126,251
| | | | |
121,727
| |
|
Retained earnings
| | | |
33,182
| | | | |
3,636
| |
|
Treasury stock (at cost), 91 shares and 16 shares as of September
30, 2018 and December 31, 2017, respectively
| | |
|
(1,410
|
)
| | |
|
(261
|
)
|
|
Total stockholders' equity attributable to Solaris and members'
equity
| | |
|
158,289
|
| | |
|
125,292
|
|
|
Non-controlling interest
| | |
|
130,459
|
| | |
|
116,268
|
|
|
Total stockholders' equity
| | |
|
288,748
|
| | |
|
241,560
|
|
|
Total liabilities and stockholders' equity
| | |
$
|
372,824
|
| | |
$
|
287,060
|
|
|
|
| | |
| | |
SOLARIS OILFIELD INFRASTRUCTURE, INC AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) |
| | | | | | |
|
| | | For the Nine Months Ended
September 30, |
| | | 2018 | | 2017 |
|
Cash flows from operating activities:
| | | | | | | |
|
Net income
| | |
$
|
61,300
| | |
$
|
13,250
| |
|
Adjustment to reconcile net income to net cash provided by operating
activities:
| | | | | | | |
|
Depreciation and amortization
| | | |
12,514
| | | |
4,276
| |
|
Loss on disposal of asset
| | | |
222
| | | |
451
| |
|
Stock-based compensation
| | | |
3,140
| | | |
2,097
| |
|
Amortization of debt issuance costs
| | | |
218
| | | |
35
| |
|
Deferred income tax expense
| | | |
9,000
| | | |
1,059
| |
|
Other
| | | |
651
| | | |
(19
|
)
|
|
Changes in assets and liabilities:
| | | | | | | |
|
Accounts receivable
| | | |
(21,599
|
)
| | |
(5,033
|
)
|
|
Prepaid expenses and other assets
| | | |
(3,667
|
)
| | |
(3,625
|
)
|
|
Inventories
| | | |
(8,575
|
)
| | |
(6,675
|
)
|
|
Accounts payable
| | | |
441
| | | |
4,504
| |
|
Accrued liabilities
| | |
|
3,894
|
| |
|
2,679
|
|
|
Net cash provided by operating activities
| | |
|
57,539
|
| |
|
12,999
|
|
|
Cash flows from investing activities:
| | | | | | | |
|
Investment in property, plant and equipment
| | | |
(125,013
|
)
| | |
(49,015
|
)
|
|
Proceeds from disposal of asset
| | | |
(6
|
)
| | |
(34
|
)
|
|
Investment in intangible assets
| | |
|
160
|
| |
|
—
|
|
|
Net cash used in investing activities
| | |
|
(124,859
|
)
| |
|
(49,049
|
)
|
|
Cash flows from financing activities:
| | | | | | | |
|
Payments under capital leases
| | | |
(21
|
)
| | |
(20
|
)
|
|
Payments under insurance premium financing
| | | |
(841
|
)
| | |
—
| |
|
Payments under notes payable
| | | |
—
| | | |
(451
|
)
|
|
Proceeds from stock option exercises
| | | |
932
| | | |
—
| |
|
Payments related to purchase of treasury stock
| | | |
(1,140
|
)
| | |
—
| |
|
Proceeds from borrowings under the senior secured credit facility
| | | |
8,000
| | | |
3,000
| |
|
Repayment of senior secured credit facility
| | | |
—
| | | |
(5,500
|
)
|
|
Proceeds from pay down of promissory note related to membership units
| | | |
—
| | | |
4,303
| |
|
Payments related to debt issuance costs
| | | |
(1,014
|
)
| | |
(111
|
)
|
|
Proceeds from issuance of Class A common stock sold in initial
public offering, net of offering costs
| | | |
—
| | | |
111,075
| |
|
Distributions paid to unit and option holders
| | | |
—
| | | |
(25,818
|
)
|
|
Other
| | |
|
60
|
| |
|
—
|
|
|
Net cash provided by financing activities
| | |
|
5,976
|
| |
|
86,478
|
|
|
Net increase (decrease) in cash
| | | |
(61,344
|
)
| | |
50,428
| |
|
Cash at beginning of period
| | |
|
63,421
|
| |
|
3,568
|
|
|
Cash at end of period
| | |
$
|
2,077
|
| |
$
|
53,996
|
|
|
Non-cash activities
| | | | | | | |
|
Investing:
| | | | | | | |
|
Capitalized depreciation in property, plant and equipment
| | |
$
|
501
| | |
$
|
492
| |
|
Property and equipment additions incurred but not paid at period-end
| | | |
6,309
| | | |
3,135
| |
|
Financing:
| | | | | | | |
|
Insurance premium financing
| | | |
1,552
| | | |
—
| |
|
Accrued interest from notes receivable issued for membership units
| | | |
—
| | | |
109
| |
|
Cash paid for:
| | | | | | | |
|
Interest
| | | |
118
| | | |
96
| |
|
Income taxes
| | | |
314
| | | |
45
| |
| | | | | | | | |
|
SOLARIS OILFIELD INFRASTRUCTURE, INC AND SUBSIDIARIES
RECONCILIATION
OF GAAP TO NON-GAAP FINANCIAL INFORMATION — ADJUSTED EBITDA
(In
thousands)
(Unaudited)
We view EBITDA and Adjusted EBITDA as important indicators of
performance. We define EBITDA as net income, plus (i) depreciation and
amortization expense, (ii) interest expense and (iii) income tax
expense, including franchise taxes. We define Adjusted EBITDA as EBITDA
plus (i) unit-based compensation expense and (ii) certain non-cash
charges and unusual or non-recurring charges.
We believe that our presentation of EBITDA and Adjusted EBITDA provides
useful information to investors in assessing our financial condition and
results of operations. Net income is the GAAP measure most directly
comparable to EBITDA and Adjusted EBITDA. EBITDA and Adjusted EBITDA
should not be considered alternatives to net income presented in
accordance with GAAP. Because EBITDA and Adjusted EBITDA may be defined
differently by other companies in our industry, our definitions of
EBITDA and Adjusted EBITDA may not be comparable to similarly titled
measures of other companies, thereby diminishing their utility. The
following table presents a reconciliation of Net income to EBITDA and
Adjusted EBITDA for each of the periods indicated.
|
|
| |
|
| |
| | | Three months ended | | | Nine months ended |
| | | September 30, |
|
| June 30, | | | September 30, |
| | | 2018 |
|
| 2017 | | | 2018 | | | 2018 |
|
| 2017 |
| | | | | | | | | | | | | | | | | | | |
|
|
Net income
| | |
$
|
26,437
| | |
$
|
7,406
| | | |
$
|
21,448
| | |
$
|
61,300
| | |
$
|
13,250
| |
|
Depreciation and amortization
| | | |
5,328
| | | |
1,742
| | | | |
3,984
| | | |
12,514
| | | |
4,276
| |
|
Interest expense, net
| | | |
116
| | | |
27
| | | | |
71
| | | |
271
| | | |
71
| |
|
Income taxes (1)
| | |
|
4,237
| | |
|
617
|
| | |
|
3,277
| | |
|
9,541
| | |
|
1,137
|
|
|
EBITDA
| | |
$
|
36,118
| | |
$
|
9,792
| | | |
$
|
28,780
| | |
$
|
83,626
| | |
$
|
18,734
| |
|
IPO bonuses (2)
| | | |
—
| | | |
617
| | | | |
307
| | | |
896
| | | |
4,046
| |
|
Stock-based compensation expense (3)
| | | |
338
| | | |
795
| | | | |
939
| | | |
2,200
| | | |
1,172
| |
|
Non-recurring cash bonuses (4)
| | | |
—
| | | |
—
| | | | |
—
| | | |
1,679
| | | |
—
| |
|
Change in payables related to tax receivable agreement
| | | |
—
| | | |
(83
|
)
| | | |
—
| | | |
—
| | | |
(83
|
)
|
|
Loss on disposal of assets
| | | |
51
| | | |
41
| | | | |
23
| | | |
77
| | | |
451
| |
|
Non-recurring organizational costs (5)
| | | |
—
| | | |
—
| | | | |
—
| | | |
—
| | | |
348
| |
|
Other (6)
| | |
|
—
| | |
|
36
|
| | |
|
—
| | |
|
—
| | |
|
36
|
|
|
Adjusted EBITDA
| | |
$
|
36,507
| | |
$
|
11,198
|
| | |
$
|
30,049
| | |
$
|
88,478
| | |
$
|
24,704
|
|
_______________________________________
| | | | | | | | | | | | | | | | | | | | | | |
|
| |
|
(1)
| |
Federal and state income taxes.
|
| |
|
|
(2)
| |
One-time cash bonuses of $3,100 in the nine months ended September
30, 2017, stock-based compensation expense related to restricted
stock awards with one-year vesting of $617 and $307 for the three
months ended September 30, 2017 and June 30, 2018, respectively, and
$896 and $946 for the nine months ended September 30, 2018 and 2017,
respectively, that were granted to certain employees and consultants
in connection with the IPO.
|
| |
|
|
(3)
| |
Represents stock-based compensation expense of $338, $685 and $939
for the three months ended September 30, 2018 and 2017 and June 30,
2018, respectively, and $2,200 and $904 for the nine months ended
September 30, 2018 and 2017, respectively, related to restricted
stock awards with three-year vesting, and $110 and $268 for the
three and nine months ended September 30, 2017, respectively,
related to the options issued under our long-term incentive plan.
|
| |
|
|
(4)
| |
Certain performance-based cash awards paid in connection with the
purchase of Railtronix upon the achievement of certain financial
milestones.
|
| |
|
|
(5)
| |
Certain non-recurring organization costs in 2017 associated with our
IPO.
|
| |
|
|
(6)
| |
Non-recurring transaction costs in the three months ended September
30, 2017.
|
| |
|
SOLARIS OILFIELD INFRASTRUCTURE, INC AND SUBSIDIARIES
RECONCILIATION
OF GAAP TO NON-GAAP FINANCIAL INFORMATION — ADJUSTED PRO FORMA NET
INCOME AND ADJUSTED PRO FORMA
EARNINGS PER FULLY EXCHANGED
AND DILUTED SHARE
(In thousands)
(Unaudited)
Adjusted pro forma net income represents net income attributable to
Solaris assuming the full exchange of all outstanding membership
interests in Solaris LLC not held by Solaris Oilfield Infrastructure,
Inc. for shares of Class A common stock, adjusted for certain
non-recurring items that the Company doesn't believe directly reflect
its core operations and may not be indicative of ongoing business
operations. Adjusted pro forma earnings per fully exchanged and diluted
share is calculated by dividing adjusted pro forma net income by the
weighted-average shares of Class A common stock outstanding, assuming
the full exchange of all outstanding Solaris LLC Units, after giving
effect to the dilutive effect of outstanding equity-based awards.
When used in conjunction with GAAP financial measures, adjusted pro
forma net income and adjusted pro forma earnings per fully exchanged and
diluted share are supplemental measures of operating performance that
the Company believes are useful measures to evaluate performance period
over period and relative to its competitors. By assuming the full
exchange of all outstanding Solaris LLC Units, the Company believes
these measures facilitate comparisons with other companies that have
different organizational and tax structures, as well as comparisons
period over period because it eliminates the effect of any changes in
net income attributable to Solaris as a result of increases in its
ownership of Solaris LLC, which are unrelated to the Company's operating
performance, and excludes items that are non-recurring or may not be
indicative of ongoing operating performance.
Adjusted pro forma net income and adjusted pro forma earnings per fully
exchanged and diluted share are not necessarily comparable to similarly
titled measures used by other companies due to different methods of
calculation. Presentation of adjusted pro forma net income and adjusted
pro forma earnings per fully exchanged and diluted share should not be
considered alternatives to net income and earnings per share, as
determined under GAAP. While these measures are useful in evaluating the
Company's performance, it does not account for the earnings attributable
to the non-controlling interest holders and therefore does not provide a
complete understanding of the net income attributable to Solaris.
Adjusted pro forma net income and adjusted pro forma earnings per fully
exchanged and diluted share should be evaluated in conjunction with GAAP
financial results. A reconciliation of adjusted pro forma net income to
net income attributable to Solaris, the most directly comparable GAAP
measure, and the computation of adjusted pro forma earnings per fully
exchanged and diluted share are set forth below.
|
|
| |
|
| |
| | | Three months ended | | | Nine months ended |
| | | September 30, |
|
| June 30, | | | September 30, |
| | | 2018 |
|
| 2017 | | | 2018 | | | 2018 |
|
| 2017 |
|
Numerator:
| | | | | | | | | | | | | | | | | | | | |
|
Net income attributable to Solaris
| | |
$
|
13,019
| | | |
$
|
1,379
| | | |
$
|
10,597
| | | |
$
|
29,546
| | | |
$
|
1,536
| |
|
Adjustments:
| | | | | | | | | | | | | | | | | | | | |
|
Reallocation of net income attributable to non-controlling interests
from the assumed exchange of LLC Interests(1)
| | | |
13,418
| | | | |
6,027
| | | | |
10,851
| | | | |
31,754
| | | | |
8,049
| |
|
IPO bonuses (2)
| | | |
—
| | | | |
617
| | | | |
307
| | | | |
896
| | | | |
4,046
| |
|
Non-recurring cash bonuses (3)
| | | |
—
| | | | |
—
| | | | |
—
| | | | |
1,679
| | | | |
—
| |
|
Loss on disposal of assets
| | | |
51
| | | | |
41
| | | | |
23
| | | | |
77
| | | | |
451
| |
|
Non-recurring organizational costs (4)
| | | |
—
| | | | |
36
| | | | |
—
| | | | |
—
| | | | |
348
| |
|
Income tax expense
| | |
|
(2,465
|
)
| | |
|
(2,570
|
)
| | |
|
(2,092
|
)
| | |
|
(5,622
|
)
| | |
|
(5,942
|
)
|
|
Adjusted pro forma net income
| | |
$
|
24,023
|
| | |
$
|
5,530
|
| | |
$
|
19,686
|
| | |
$
|
58,330
|
| | |
$
|
8,488
|
|
|
Denominator:
| | | | | | | | | | | | | | | | | | | | |
|
Weighted average shares of Class A common stock outstanding - diluted
| | | |
26,329
| | | | |
10,563
| | | | |
25,711
| | | | |
25,380
| | | | |
10,552
| |
|
Adjustments:
| | | | | | | | | | | | | | | | | | | | |
|
Assumed exchange of Solaris LLC Units for shares of Class A common
stock (1)
| | |
|
20,781
|
| | |
|
32,726
|
| | |
|
21,560
|
| | |
|
21,843
|
| | |
|
32,683
|
|
|
Adjusted pro forma fully exchanged weighted average shares of Class
A common stock outstanding - diluted
| | |
|
47,110
|
| | |
|
43,289
|
| | |
|
47,271
|
| | |
|
47,223
|
| | |
|
43,235
|
|
|
Adjusted pro forma earnings per fully exchanged share - diluted
| | |
$
|
0.51
|
| | |
$
|
0.13
|
| | |
$
|
0.42
|
| | |
$
|
1.24
|
| | |
$
|
0.20
|
|
|
| |
|
(1)
| |
Assumes the exchange of all outstanding Solaris LLC Units for shares
of Class A common stock at the beginning of the relevant reporting
period, resulting in the elimination of the non-controlling interest
and recognition of the net income attributable to non-controlling
interests.
|
| |
|
|
(2)
| |
One-time cash bonuses of $3,100 in the nine months ended September
30, 2017, stock-based compensation expense related to restricted
stock awards with one-year vesting of $617 and $307 for the three
months ended September 30, 2017 and June 30, 2018, respectively, and
$896 and $946 for the nine months ended September 30, 2018 and 2017,
respectively, that were granted to certain employees and consultants
in connection with the IPO.
|
| |
|
|
(3)
| |
Certain performance-based cash awards paid in connection with the
purchase of Railtronix upon the achievement of certain financial
milestones.
|
| |
|
|
(4)
| |
Certain non-recurring organization costs in 2017 associated with our
IPO.
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20181031005882/en/
Solaris Oilfield Infrastructure, Inc.
Yvonne Fletcher, (281)
501-3070
Senior Vice President, Finance and Investor Relations
[email protected]
Source: Solaris Oilfield Infrastructure, Inc.