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U.S. Silica (SLCA) Q3 Loss Lower Than Expected, Sales Trail

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U.S. Silica Holdings, Inc. (SLCA - Free Report) logged a net loss of $11.3 million or 17 cents per share in third-quarter 2016. The company had posted a profit of $2.4 million or 4 cents per share in the year-ago quarter. The results in the reported quarter were unfavorably impacted by business development-related expenses.

Barring one-time items, U.S. Silica’s loss came in at 13 cents per share in the quarter, narrower than the Zacks Consensus Estimate of a loss of 19 cents.

Revenues slipped 11% year over year to $137.7 million in the reported quarter. Sales fell short of the Zacks Consensus Estimate of $138 million. Overall sales volume fell 5% year over year in the quarter to 2.5 million tons.

U.S. Silica’s shares closed around 1.9% higher at $43.73 last Friday.     


Segment Analysis

Revenues for the Oil & Gas division were $86.8 million in the reported quarter, down 15% year over year. Overall sales volume was flat year over year at 1.6 million tons.

Revenues for the Industrial and Specialty Products division were $51 million, down 5% year over year. Overall sales volume declined 13% in the quarter to roughly 0.9 million tons.


U.S. Silica had $264.1 million in cash and cash equivalents at the end of the quarter, up roughly 4% year over year. Long-term debt was $499.9 million, up around 2% year over year.

Capital expenditures for the quarter was $9.4 million, mostly related to the company's investments in various maintenance, expansion and cost improvement projects.


Owing to lack of visibility in the Oil and Gas business, U.S. Silica said that it will not provide any guidance for adjusted EBITDA until it gets a clear picture of business activity levels and related demand for its products. Factoring in the current market conditions, the company expects its capital expenditures for 2016 to be in the band of $42–$47 million.

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


US SILICA HOLDI Price and EPS Surprise



Other Stocks to Consider

Other well-placed companies in the basic materials space include Innophos Holdings Inc (IPHS - Free Report) , Koppers Holdings Inc. (KOP - Free Report) and Celanese Corporation (CE - Free Report) .

Innophos sports a Zacks Rank #1 (Strong Buy). The company has an expected earnings growth of 51.4% for the current year.

Koppers has an expected earnings growth of around 62.3% for the current year. The stock carries a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Celanese carries a Zacks Rank #2 and has an expected earnings growth of around 9.4% for the current year.

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