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U.S. Silica (SLCA) Earnings Beat, Sales Miss Estimates in Q1

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U.S. Silica Holdings, Inc. (SLCA - Free Report) reported a net loss of $8.4 million or 11 cents per share in first-quarter 2022 compared with a loss of $20.8 million or 28 cents per share in the year-ago quarter.

Barring one-time items, the adjusted loss per share was 2 cents, narrower than the Zacks Consensus Estimate of a loss of 13 cents.

U.S. Silica generated revenues of $304.9 million, up 30.1% year over year. The figure missed the Zacks Consensus Estimate of $305.6 million.

U.S. Silica Holdings, Inc. Price, Consensus and EPS Surprise

 

U.S. Silica Holdings, Inc. Price, Consensus and EPS Surprise

U.S. Silica Holdings, Inc. price-consensus-eps-surprise-chart | U.S. Silica Holdings, Inc. Quote

 

Segment Highlights

Revenues in the Oil & Gas division amounted to $176.2 million in the first quarter, up 45% year over year and 11% sequentially. Overall sales volume increased 19% year over year to 3.06 million tons. The Oil & Gas contribution margin rose 49% sequentially and 108% year over year to $44.8 million or $14.63 per ton.

Revenues in the Industrial & Specialty Products division amounted to $128.6 million in the first quarter, up 14% year over year and 2% sequentially. Overall sales volume increased 9% year over year to 1.074 million tons. The segment’s contribution margin was $37.8 million or $35.23 per ton in the quarter, down 9% sequentially and 6% year over year.

Financials

At the end of the quarter, the company’s cash and cash equivalents were $239.8 million, up modestly from $239.4 million in the prior quarter. Long-term debt fell to $1,191.9 million from $1,193.1 million in the previous quarter.

Outlook

For the second quarter and second-half 2022, U.S. Silica noted that two business segments are well-positioned for contribution margin expansion and growth in their respective markets. It has a strong portfolio of Industrial and Specialty Products that serve several essential, high-growth and attractive end markets, backed by a strong pipeline of new products under development and pricing increases and surcharges, the company noted.

In the Oil & Gas segment, the company expects a multi-year growth cycle. The strength in commodity prices, especially WTI crude oil and natural gas prices, and increases in consumer spending support an active well completions environment in 2022.

The company is focused on delivering free cash flow in 2022, deleveraging its balance sheet and intends to be operating cash flow positive in 2022. It forecasts capital expenditures in the range of $40-60 million.

Price Performance

Shares of U.S. Silica have surged 69.2% in the past year against a 9.1% decline of the industry.

Zacks Investment Research
Image Source: Zacks Investment Research

Zacks Rank & Key Picks

U.S. Silica currently carries a Zacks Rank #2 (Buy).

Some better-ranked stocks in the basic materials space are Nutrien Ltd. (NTR - Free Report) , AdvanSix Inc. (ASIX - Free Report) and Allegheny Technologies Incorporated (ATI - Free Report) .

Nutrien has a projected earnings growth rate of 127.9% for the current year. The Zacks Consensus Estimate for NTR's current-year earnings has been revised 31.1% upward in the past 60 days.

Nutrien’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, while missing once. It delivered a trailing four-quarter earnings surprise of roughly 5.9%, on average. NTR has rallied around 78.8% in a year and currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

AdvanSix has a projected earnings growth rate of 63.4% for the current year. The Zacks Consensus Estimate for ASIX’s current-year earnings has been revised 39.4% upward in the past 60 days.

AdvanSix’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, the average being 23.6%. ASIX has surged 43.4% in a year. The company carries a Zacks Rank #1.

Allegheny, currently sporting a Zacks Rank #1, has an expected earnings growth rate of 707.7% for the current year. The Zacks Consensus Estimate for ATI's earnings for the current year has been revised 6.1% upward in the past 60 days.

Allegheny’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average being 127.2%. ATI has rallied around 16.8% over a year.