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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Emerge Energy Services LP Common Units Representing Limited Partner Interests | NYSE:EMES | NYSE | Ordinary Share |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.2099 | 0.00 | 01:00:00 |
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Delaware
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90-0832937
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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5600 Clearfork Main Street, Suite 400, Fort Worth, Texas 76109
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(817) 618-4020
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(Address of principal executive offices)
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(Registrant’s telephone number, including area code)
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Title of Each Class
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Name of Each Exchange On Which Registered
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Common Units Representing Limited Partner Interests
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New York Stock Exchange
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Large-Accelerated Filer
o
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Accelerated Filer
x
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Non-Accelerated Filer
o
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Smaller Reporting Company
o
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Emerging growth company
o
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Page
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•
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failure to secure or maintain contracts with our largest customers, or non-performance of any of those customers under the applicable contract;
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•
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competitive conditions in our industry;
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•
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the amount of frac sand we are able to excavate and process, which could be adversely affected by, among other things, operating difficulties and unusual or unfavorable geologic conditions;
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•
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the volume of frac sand we are able to sell;
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•
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the price at which we are able to sell frac sand;
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•
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changes in the long-term supply of and demand for oil and natural gas;
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•
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volatility of fuel prices;
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•
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unanticipated ground, grade or water conditions at our sand mines;
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•
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actions taken by our customers, competitors and third-party operators;
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•
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our ability to complete growth projects on time and on budget;
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•
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our ability to realize the expected benefits from recent acquisitions;
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•
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increasing costs and minimum contractual obligations relating to our transportation services and infrastructure;
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•
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inclement or hazardous weather conditions, including flooding, and the physical impacts of climate change;
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•
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environmental hazards;
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•
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industrial accidents;
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•
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changes in laws and regulations (or the interpretation thereof) related to the mining and hydraulic fracturing industries, silica dust exposure or the environment;
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•
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inability to acquire or maintain necessary permits or mining or water rights;
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•
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facility shutdowns in response to environmental regulatory actions;
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•
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inability to obtain necessary production equipment or replacement parts;
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•
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reduction in the amount of water available for processing;
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•
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technical difficulties or failures;
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•
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labor disputes and disputes with our excavation contractor;
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•
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late delivery of supplies;
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•
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difficulty collecting receivables;
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•
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inability of our customers to take delivery of our products;
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•
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changes in the price and availability of transportation;
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•
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fires, explosions or other accidents;
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•
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pit wall failures or rock falls;
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•
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the effects of future litigation; and
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•
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other factors discussed in this Quarterly Report on Form 10-Q and the detailed factors discussed under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended
December 31, 2017
.
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September 30, 2018
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December 31, 2017
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||||
ASSETS
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||||
Current assets:
|
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||||
Cash and cash equivalents
|
$
|
2,825
|
|
|
$
|
5,729
|
|
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Trade and other receivables, net
|
30,068
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|
56,951
|
|
|
||
Inventories
|
32,554
|
|
|
27,825
|
|
|
||
Prepaid expenses and other current assets
|
12,899
|
|
|
6,331
|
|
|
||
Total current assets
|
78,346
|
|
|
96,836
|
|
|
||
|
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|
||||
Property, plant and equipment, net
|
229,873
|
|
|
185,970
|
|
|
||
Intangible assets, net
|
58
|
|
|
1,664
|
|
|
||
Other assets, net
|
21,108
|
|
|
24,422
|
|
|
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Total assets
|
$
|
329,385
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$
|
308,892
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||||
LIABILITIES AND PARTNERS’ EQUITY
|
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|
||||
Current liabilities:
|
|
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|
||||
Accounts payable
|
$
|
30,074
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|
|
$
|
18,819
|
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|
Accrued liabilities
|
16,478
|
|
|
29,718
|
|
|
||
Current portion of long-term debt
|
13,438
|
|
|
—
|
|
|
||
Total current liabilities
|
59,990
|
|
|
48,537
|
|
|
||
|
|
|
|
|
||||
Long-term debt, net of current portion
|
182,866
|
|
|
176,351
|
|
|
||
Obligation for business acquisition, net of current portion
|
4,242
|
|
|
5,013
|
|
|
||
Other long-term liabilities
|
18,979
|
|
|
29,882
|
|
|
||
Total liabilities
|
266,077
|
|
|
259,783
|
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||
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|
||||
Commitments and contingencies
|
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|
||||
Partners’ equity:
|
|
|
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|
||||
General partner
|
—
|
|
|
—
|
|
|
||
Limited partner common units - 31,034,338 units and 30,174,940 units issued and outstanding as of September 30, 2018 and December 31, 2017, respectively
|
63,308
|
|
|
49,109
|
|
|
||
Total partners’ equity
|
63,308
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|
49,109
|
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|
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Total liabilities and partners’ equity
|
$
|
329,385
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$
|
308,892
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Three Months Ended September 30,
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Nine Months Ended September 30,
|
|
||||||||||||
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2018
|
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2017
|
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2018
|
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2017
|
|
||||||||
Revenues
|
$
|
62,961
|
|
|
$
|
103,215
|
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|
$
|
271,553
|
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$
|
261,161
|
|
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Operating expenses:
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|
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|
||||||||
Cost of goods sold (excluding depreciation, depletion and amortization)
|
52,337
|
|
|
80,239
|
|
|
205,229
|
|
|
223,978
|
|
|
||||
Depreciation, depletion and amortization
|
5,316
|
|
|
6,078
|
|
|
15,532
|
|
|
16,409
|
|
|
||||
Selling, general and administrative expenses
|
3,693
|
|
|
7,302
|
|
|
19,654
|
|
|
20,030
|
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|
||||
Contract and project terminations
|
—
|
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|
—
|
|
|
1,689
|
|
|
—
|
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|
||||
Total operating expenses
|
61,346
|
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|
93,619
|
|
|
242,104
|
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|
260,417
|
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|
||||
Operating income (loss)
|
1,615
|
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|
9,596
|
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|
29,449
|
|
|
744
|
|
|
||||
Other expense (income):
|
|
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|
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||||||||
Interest expense, net
|
6,907
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|
5,073
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24,135
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13,353
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||||
Other
|
(1,472
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)
|
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(901
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)
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(1,930
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)
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(3,218
|
)
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|
||||
Total other expense
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5,435
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4,172
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22,205
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10,135
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Income (loss) from continuing operations before provision for income taxes
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(3,820
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)
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|
5,424
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|
7,244
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(9,391
|
)
|
|
||||
Provision (benefit) for income taxes
|
33
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(58
|
)
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|
183
|
|
|
(58
|
)
|
|
||||
Net income (loss) from continuing operations
|
(3,853
|
)
|
|
5,482
|
|
|
7,061
|
|
|
(9,333
|
)
|
|
||||
Income (loss) from discontinued operations, net of taxes
|
—
|
|
|
(468
|
)
|
|
—
|
|
|
(3,125
|
)
|
|
||||
Net income (loss)
|
$
|
(3,853
|
)
|
|
$
|
5,014
|
|
|
$
|
7,061
|
|
|
$
|
(12,458
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per common unit (1)
|
|
|
|
|
|
|
|
|
||||||||
Basic:
|
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per common unit from continuing operations
|
$
|
(0.12
|
)
|
|
$
|
0.19
|
|
|
$
|
0.23
|
|
|
$
|
(0.31
|
)
|
|
Earnings (loss) per common unit from discontinued operations
|
—
|
|
|
(0.02
|
)
|
|
—
|
|
|
(0.10
|
)
|
|
||||
Basic earnings (loss) per common unit
|
$
|
(0.12
|
)
|
|
$
|
0.17
|
|
|
$
|
0.23
|
|
|
$
|
(0.41
|
)
|
|
|
|
|
|
|
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|
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|
||||||||
Diluted:
|
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per common unit from continuing operations
|
$
|
(0.12
|
)
|
|
$
|
0.18
|
|
|
$
|
0.23
|
|
|
$
|
(0.42
|
)
|
|
Earnings (loss) per common unit from discontinued operations
|
—
|
|
|
(0.02
|
)
|
|
—
|
|
|
(0.10
|
)
|
|
||||
Diluted earnings (loss) per common unit
|
$
|
(0.12
|
)
|
|
$
|
0.16
|
|
|
$
|
0.23
|
|
|
$
|
(0.52
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average number of common units outstanding - basic (1)
|
31,034,186
|
|
|
30,270,572
|
|
|
31,233,523
|
|
|
30,120,216
|
|
|
||||
Weighted average number of common units outstanding - diluted (1)
|
31,034,186
|
|
|
30,400,584
|
|
|
31,371,152
|
|
|
30,183,091
|
|
|
||||
(1) See Note 8.
|
|
|
|
|
|
|
|
|
|
Limited Partner Common Units
|
|
General Partner
(non-economic interest) |
|
Total Partners’ Equity
|
|
||||||
|
|
|
|
|
|
|
||||||
Balance at December 31, 2017
|
$
|
49,109
|
|
|
$
|
—
|
|
|
$
|
49,109
|
|
|
Net income
|
7,061
|
|
|
—
|
|
|
7,061
|
|
|
|||
Equity-based compensation
|
1,224
|
|
|
—
|
|
|
1,224
|
|
|
|||
Issuance of equity
|
5,974
|
|
|
—
|
|
|
5,974
|
|
|
|||
Other
|
(60
|
)
|
|
—
|
|
|
(60
|
)
|
|
|||
Balance at September 30, 2018
|
$
|
63,308
|
|
|
$
|
—
|
|
|
$
|
63,308
|
|
|
|
Nine Months Ended September 30,
|
|
||||||
|
2018
|
|
2017
|
|
||||
|
|
|
|
|
||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net income (loss)
|
$
|
7,061
|
|
|
$
|
(12,458
|
)
|
|
Adjustments to reconcile net income (loss) to net cash flows from operating activities:
|
|
|
|
|
||||
Depreciation, depletion and amortization
|
15,532
|
|
|
16,409
|
|
|
||
Equity-based compensation expense
|
1,224
|
|
|
1,020
|
|
|
||
Project and contract termination costs
|
1,689
|
|
|
—
|
|
|
||
Unrealized (gain) loss on fair value of warrant
|
(1,899
|
)
|
|
(3,212
|
)
|
|
||
Write-down of escrow receivable
|
—
|
|
|
3,125
|
|
|
||
Provision for doubtful accounts
|
310
|
|
|
—
|
|
|
||
Loss (gain) on disposal of assets
|
424
|
|
|
79
|
|
|
||
Amortization of debt discount/premium and deferred financing costs
|
6,597
|
|
|
2,750
|
|
|
||
Unrealized (gain) loss on derivative instruments
|
—
|
|
|
(225
|
)
|
|
||
Other non-cash charges
|
91
|
|
|
83
|
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Accounts receivable
|
26,701
|
|
|
(31,881
|
)
|
|
||
Inventories
|
(4,729
|
)
|
|
(9,411
|
)
|
|
||
Prepaid expenses and other current assets
|
(6,568
|
)
|
|
2,713
|
|
|
||
Accounts payable and accrued liabilities
|
239
|
|
|
16,888
|
|
|
||
Other assets
|
1,718
|
|
|
233
|
|
|
||
Cash flows from operating activities
|
48,390
|
|
|
(13,887
|
)
|
|
||
|
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
|
||||
Purchases of property, plant and equipment
|
(64,154
|
)
|
|
(5,439
|
)
|
|
||
Net proceeds from disposal of assets
|
834
|
|
|
211
|
|
|
||
Asset acquisition
|
—
|
|
|
(20,430
|
)
|
|
||
Cash flows from investing activities
|
(63,320
|
)
|
|
(25,658
|
)
|
|
||
|
|
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|
|
||||
Cash flows from financing activities:
|
|
|
|
|
||||
Proceeds from line of credit borrowings
|
11,014
|
|
|
253,075
|
|
|
||
Proceeds from second lien notes
|
175,000
|
|
|
39,597
|
|
|
||
Repayment of line of credit borrowings
|
(154,714
|
)
|
|
(247,272
|
)
|
|
||
Repayment of other long-term debt
|
(5,882
|
)
|
|
—
|
|
|
||
Payment of business acquisition obligation
|
(1,361
|
)
|
|
(2,223
|
)
|
|
||
Payment of financing costs
|
(11,971
|
)
|
|
(3,024
|
)
|
|
||
Other financing activities
|
(60
|
)
|
|
(63
|
)
|
|
||
Cash flows from financing activities
|
12,026
|
|
|
40,090
|
|
|
||
|
|
|
|
|
||||
Cash and cash equivalents:
|
|
|
|
|
|
|||
Net increase (decrease)
|
(2,904
|
)
|
|
545
|
|
|
||
Balance at beginning of period
|
5,729
|
|
|
4
|
|
|
||
Balance at end of period
|
$
|
2,825
|
|
|
$
|
549
|
|
|
|
Three Months Ended September 30,
|
|
||||||||||||
|
2018
|
|
2017
|
|
||||||||||
|
$ in Thousands
|
|
Tons in Thousands
|
|
$ in Thousands
|
|
Tons in Thousands
|
|
||||||
|
|
|
|
|
|
|
|
|
||||||
Frac sand revenues
|
$
|
61,597
|
|
|
985
|
|
|
$
|
101,795
|
|
|
1,361
|
|
|
Non-frac sand revenues
|
1,364
|
|
|
88
|
|
|
1,420
|
|
|
119
|
|
|
||
Total revenues
|
$
|
62,961
|
|
|
1,073
|
|
|
$
|
103,215
|
|
|
1,480
|
|
|
|
Nine Months Ended September 30,
|
|
||||||||||||
|
2018
|
|
2017
|
|
||||||||||
|
$ in Thousands
|
|
Tons in Thousands
|
|
$ in Thousands
|
|
Tons in Thousands
|
|
||||||
|
|
|
|
|
|
|
|
|
||||||
Frac sand revenues
|
$
|
268,356
|
|
|
3,941
|
|
|
$
|
258,055
|
|
|
3,890
|
|
|
Non-frac sand revenues
|
3,197
|
|
|
224
|
|
|
3,106
|
|
|
233
|
|
|
||
Total revenues
|
$
|
271,553
|
|
|
4,165
|
|
|
$
|
261,161
|
|
|
4,123
|
|
|
•
|
$7 million
of the sales price was withheld as a general escrow associated with certain indemnification obligations. Any unutilized escrow balance, plus any accrued interest thereon, will be paid
54 months
from the closing date.
|
•
|
$4 million
of the sales price was withheld as a hydrotreater escrow to satisfy any cost overruns of the Birmingham hydrotreater completion. In 2017, we wrote off the entire receivable relating to hydrotreator completion delays and cost overruns.
|
•
|
$2.25 million
of the sales price was withheld as the Renewable Fuel Standard escrow account. The entire amount, along with interest thereon, was collected in April 2017.
|
•
|
$1 million
of the sales price was withheld as a pipeline escrow account. Any unutilized escrow balance, along with any accrued interest thereon, will be released with the general escrow.
|
|
September 30, 2018
|
|
December 31, 2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Sand work in process
|
$
|
22,012
|
|
|
$
|
14,650
|
|
|
Sand finished goods
|
10,471
|
|
|
12,914
|
|
|
||
Sand raw materials and supplies
|
71
|
|
|
261
|
|
|
||
Total
|
$
|
32,554
|
|
|
$
|
27,825
|
|
|
|
September 30, 2018
|
|
|
December 31, 2017
|
|
|
||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Prepaid services
|
$
|
6,071
|
|
|
$
|
1,011
|
|
|
Prepaid lease assets, current (1)
|
2,251
|
|
|
2,496
|
|
|
||
Prepaid transload services
|
1,888
|
|
|
1,274
|
|
|
||
Prepaid insurance
|
1,231
|
|
|
875
|
|
|
||
Other
|
1,458
|
|
|
675
|
|
|
||
Total
|
$
|
12,899
|
|
|
$
|
6,331
|
|
|
(1)
|
The cost to transport leased railcars from the manufacturer to our site for initial placement in service is capitalized and amortized over the term of the lease (typically
five
to
seven
years). This balance reflects the current portion of these capitalized costs.
|
|
September 30, 2018
|
|
December 31, 2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Machinery and equipment (1)
|
$
|
99,849
|
|
|
$
|
92,353
|
|
|
Buildings and improvements (1)
|
94,115
|
|
|
66,444
|
|
|
||
Mineral reserves
|
49,091
|
|
|
49,091
|
|
|
||
Land and improvements (1)
|
48,273
|
|
|
45,567
|
|
|
||
Construction in progress
|
34,170
|
|
|
15,696
|
|
|
||
Capitalized reclamation costs
|
2,521
|
|
|
2,521
|
|
|
||
Total cost
|
328,019
|
|
|
271,672
|
|
|
||
Accumulated depreciation and depletion
|
98,146
|
|
|
85,702
|
|
|
||
Net property, plant and equipment
|
$
|
229,873
|
|
|
$
|
185,970
|
|
|
|
Cost
|
|
Accumulated
Amortization |
|
Net
|
|
||||||
|
|
|
|
|
|
|
||||||
|
($ in thousands)
|
|
||||||||||
September 30, 2018:
|
|
|
|
|
|
|
||||||
Non-compete agreement
|
$
|
100
|
|
|
$
|
42
|
|
|
$
|
58
|
|
|
|
|
|
|
|
|
|
||||||
December 31, 2017:
|
|
|
|
|
|
|
||||||
Patents
|
$
|
7,443
|
|
|
$
|
6,188
|
|
|
$
|
1,255
|
|
|
Supply and transportation agreements
|
569
|
|
|
226
|
|
|
343
|
|
|
|||
Non-compete agreement
|
100
|
|
|
34
|
|
|
66
|
|
|
|||
Total
|
$
|
8,112
|
|
|
$
|
6,448
|
|
|
$
|
1,664
|
|
|
|
September 30, 2018
|
|
December 31, 2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Deferred lease asset (1)
|
$
|
8,727
|
|
|
$
|
8,775
|
|
|
Prepaid lease assets, net of current portion (2)
|
5,963
|
|
|
7,153
|
|
|
||
Escrow receivable, non-current (3)
|
5,953
|
|
|
5,684
|
|
|
||
Other
|
465
|
|
|
2,810
|
|
|
||
Total
|
$
|
21,108
|
|
|
$
|
24,422
|
|
|
(1)
|
During 2016, we completed negotiations with various railcar lessors pursuant to which we terminated future orders of railcars, deferred future railcar deliveries and reduced and deferred payments on existing leases. The cost of deferring future railcar deliveries was recorded as a deferred lease asset. This asset will be amortized over the terms of the associated leases as those railcars enter service.
|
(2)
|
The cost to transport leased railcars from the manufacturer to our site for initial placement in service is capitalized and amortized over the term of the lease (typically
five
to
seven
years). This balance reflects the non-current portion of these capitalized costs.
|
(3)
|
Non-current receivables are recorded at net present value of estimated recoveries and will be adjusted as contingencies are resolved.
|
|
September 30, 2018
|
|
December 31, 2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Mining
|
$
|
3,461
|
|
|
$
|
170
|
|
|
Logistics
|
3,202
|
|
|
5,898
|
|
|
||
Fuel sale related liabilities
|
2,483
|
|
|
2,475
|
|
|
||
Construction
|
1,327
|
|
|
7,122
|
|
|
||
Sales, excise, property and income taxes
|
1,269
|
|
|
1,953
|
|
|
||
Current portion of business acquisition obligations
|
1,255
|
|
|
1,952
|
|
|
||
Salaries and other employee-related
|
860
|
|
|
4,633
|
|
|
||
Deferred compensation
|
848
|
|
|
848
|
|
|
||
Accrued interest
|
367
|
|
|
2,552
|
|
|
||
Professional fees
|
273
|
|
|
373
|
|
|
||
Sand purchases and royalties
|
258
|
|
|
311
|
|
|
||
Current portion of contract termination
|
85
|
|
|
210
|
|
|
||
Other
|
790
|
|
|
1,221
|
|
|
||
Total
|
$
|
16,478
|
|
|
$
|
29,718
|
|
|
|
September 30, 2018
|
|
December 31, 2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Deferred lease obligation (1)
|
$
|
11,000
|
|
|
$
|
9,561
|
|
|
Long-term promissory note
|
3,376
|
|
|
9,370
|
|
|
||
Asset retirement obligation
|
2,800
|
|
|
2,792
|
|
|
||
Warrants
|
912
|
|
|
2,811
|
|
|
||
Contract and project terminations
|
891
|
|
|
5,348
|
|
|
||
Total
|
$
|
18,979
|
|
|
$
|
29,882
|
|
|
(1)
|
We recognize lease expense for operating leases on a straight-line basis over the term of the lease, beginning on the date we take possession of the property. The difference between the cash paid to the lessor and the amount recognized as lease expense on a straight-line basis is included in deferred lease obligation.
|
|
September 30, 2018
|
|
December 31, 2017
|
|
||
Customer A
|
20
|
%
|
|
*
|
|
|
Customer B
|
18
|
%
|
|
17
|
%
|
|
Customer C
|
12
|
%
|
|
*
|
|
|
Customer D
|
12
|
%
|
|
20
|
%
|
|
Customer E
|
*
|
|
|
13
|
%
|
|
|
September 30, 2018
|
|
September 30, 2017
|
|
||
Customer B
|
26
|
%
|
|
17
|
%
|
|
Customer D
|
13
|
%
|
|
*
|
|
|
Customer A
|
12
|
%
|
|
21
|
%
|
|
Customer E
|
*
|
|
|
10
|
%
|
|
|
September 30, 2018
|
|
December 31, 2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Second lien term loan - principal
|
$
|
215,000
|
|
|
$
|
40,000
|
|
|
Revolving credit facility - principal
|
—
|
|
|
143,700
|
|
|
||
Less: Deferred financing costs, net
|
(18,696
|
)
|
|
(7,349
|
)
|
|
||
Total debt
|
196,304
|
|
|
176,351
|
|
|
||
Less current portion
|
(13,438
|
)
|
|
—
|
|
|
||
Long-term debt
|
$
|
182,866
|
|
|
$
|
176,351
|
|
|
•
|
a minimum liquidity requirement of
$20.0 million
at all times;
|
•
|
beginning with the fiscal quarter ending March 31, 2018, a total leverage ratio of a maximum of
5.50
:1.00 decreasing quarterly thereafter to
3.00
:1.00 for the fiscal quarter ending December 31, 2018, and thereafter;
|
•
|
beginning with the fiscal quarter ending March 31, 2018, a minimum fixed charge coverage ratio of
1.10
:1.00; and
|
•
|
a limit on capital expenditures, subject to certain availability thresholds.
|
•
|
a minimum liquidity requirement of
$20.0 million
at all times;
|
•
|
beginning with the fiscal quarter ending March 31, 2018, a total leverage ratio of a maximum of
6.00
:1.00 decreasing quarterly thereafter to
3.00
:1.00 for the fiscal quarter ending March 31, 2019, and thereafter;
|
•
|
beginning with the fiscal quarter ending March 31, 2018, a minimum fixed charge coverage ratio of
1.10
:1.00, increasing quarterly to
2.00
:1.00 for the fiscal quarter ending March 31, 2019, and thereafter; and
|
•
|
a limit on capital expenditures, subject to certain availability thresholds.
|
|
Nine Months Ended September 30,
|
|
||||||
|
2018
|
|
2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Employee-related and other costs (1)
|
$
|
20,401
|
|
|
$
|
13,338
|
|
|
|
September 30, 2018
|
|
December 31, 2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Accounts receivable, net
|
$
|
97
|
|
|
$
|
962
|
|
|
Accounts payable and accrued liabilities
|
$
|
521
|
|
|
$
|
800
|
|
|
(1)
|
We do not have any employees. Our general partner manages our human resource assets, including fringe benefits and other employee-related charges. We routinely and regularly reimburse our general partner for any employee-related costs paid on our behalf, and report such costs as operating expenses.
|
|
Total
Units |
|
Phantom
Units |
|
Restricted
Units |
|
Fair Value per Unit
at Award Date |
|
|||||
Outstanding at December 31, 2017
|
333,821
|
|
|
310,780
|
|
|
23,041
|
|
|
$
|
13.10
|
|
|
Granted
|
61,768
|
|
|
24,800
|
|
|
36,968
|
|
|
$
|
7.90
|
|
|
Vested
|
(53,656
|
)
|
|
(30,616
|
)
|
|
(23,040
|
)
|
|
$
|
13.44
|
|
|
Forfeitures
|
(2,000
|
)
|
|
(2,000
|
)
|
|
—
|
|
|
$
|
6.98
|
|
|
Outstanding at September 30, 2018
|
339,933
|
|
|
302,964
|
|
|
36,969
|
|
|
$
|
12.14
|
|
|
|
Nine Months Ended September 30,
|
|
||||||
|
2018
|
|
2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Texas margin tax
|
$
|
128
|
|
|
$
|
(58
|
)
|
|
Canadian income tax
|
55
|
|
|
—
|
|
|
||
Total provision for income taxes
|
$
|
183
|
|
|
$
|
(58
|
)
|
|
|
Continuing
|
|
Discontinued
|
|
Consolidated
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Three Months Ended September 30,
|
|
||||||||||||||||||||||
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
($ in thousands, except unit and per unit data)
|
|
||||||||||||||||||||||
Net income (loss)
|
$
|
(3,853
|
)
|
|
$
|
5,482
|
|
|
$
|
—
|
|
|
$
|
(468
|
)
|
|
$
|
(3,853
|
)
|
|
$
|
5,014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Weighted average common units outstanding
|
31,034,186
|
|
|
30,150,915
|
|
|
31,034,186
|
|
|
30,150,915
|
|
|
31,034,186
|
|
|
30,150,915
|
|
|
||||||
Weighted average units deemed participating securities
|
—
|
|
|
119,657
|
|
|
—
|
|
|
119,657
|
|
|
—
|
|
|
119,657
|
|
|
||||||
Weighted average number of common units outstanding - basic
|
31,034,186
|
|
|
30,270,572
|
|
|
31,034,186
|
|
|
30,270,572
|
|
|
31,034,186
|
|
|
30,270,572
|
|
|
||||||
Add incremental units from assumed exercise of warrants
|
—
|
|
|
130,012
|
|
|
—
|
|
|
130,012
|
|
|
—
|
|
|
130,012
|
|
|
||||||
Weighted average number of common units outstanding - diluted
|
31,034,186
|
|
|
30,400,584
|
|
|
31,034,186
|
|
|
30,400,584
|
|
|
31,034,186
|
|
|
30,400,584
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Earnings (loss) per unit, basic
|
$
|
(0.12
|
)
|
|
$
|
0.19
|
|
|
$
|
—
|
|
|
$
|
(0.02
|
)
|
|
$
|
(0.12
|
)
|
|
$
|
0.17
|
|
|
Earnings (loss) per unit, diluted
|
$
|
(0.12
|
)
|
|
$
|
0.18
|
|
|
$
|
—
|
|
|
$
|
(0.02
|
)
|
|
$
|
(0.12
|
)
|
|
$
|
0.16
|
|
|
|
Continuing
|
|
Discontinued
|
|
Consolidated
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Nine Months Ended September 30,
|
|
||||||||||||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
($ in thousands, except unit and per unit data)
|
|
||||||||||||||||||||||
Net income (loss) used to compute earnings (loss) per common unit, basic
|
$
|
7,061
|
|
|
$
|
(9,333
|
)
|
|
$
|
—
|
|
|
$
|
(3,125
|
)
|
|
$
|
7,061
|
|
|
$
|
(12,458
|
)
|
|
Unrealized (gain) loss on fair value of warrant
|
—
|
|
|
(3,212
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,212
|
)
|
|
||||||
Net income (loss) used to compute earnings (loss) per common unit, diluted
|
$
|
7,061
|
|
|
$
|
(12,545
|
)
|
|
$
|
—
|
|
|
$
|
(3,125
|
)
|
|
$
|
7,061
|
|
|
$
|
(15,670
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Weighted average common units outstanding
|
31,020,310
|
|
|
30,120,216
|
|
|
31,020,310
|
|
|
30,120,216
|
|
|
31,020,310
|
|
|
30,120,216
|
|
|
||||||
Weighted average units deemed participating securities
|
213,213
|
|
|
—
|
|
|
213,213
|
|
|
—
|
|
|
213,213
|
|
|
—
|
|
|
||||||
Weighted average number of common units outstanding - basic
|
31,233,523
|
|
|
30,120,216
|
|
|
31,233,523
|
|
|
30,120,216
|
|
|
31,233,523
|
|
|
30,120,216
|
|
|
||||||
Weighted average potentially dilutive units outstanding
|
15,757
|
|
|
—
|
|
|
15,757
|
|
|
—
|
|
|
15,757
|
|
|
—
|
|
|
||||||
Add incremental units from assumed exercise of warrants
|
121,872
|
|
|
62,875
|
|
|
121,872
|
|
|
62,875
|
|
|
121,872
|
|
|
62,875
|
|
|
||||||
Weighted average number of common units outstanding - diluted
|
31,371,152
|
|
|
30,183,091
|
|
|
31,371,152
|
|
|
30,183,091
|
|
|
31,371,152
|
|
|
30,183,091
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Earnings (loss) per unit, basic
|
$
|
0.23
|
|
|
$
|
(0.31
|
)
|
|
$
|
—
|
|
|
$
|
(0.10
|
)
|
|
$
|
0.23
|
|
|
$
|
(0.41
|
)
|
|
Earnings (loss) per unit, diluted
|
$
|
0.23
|
|
|
$
|
(0.42
|
)
|
|
$
|
—
|
|
|
$
|
(0.10
|
)
|
|
$
|
0.23
|
|
|
$
|
(0.52
|
)
|
|
•
|
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.
|
•
|
Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument.
|
•
|
Level 3 inputs are measured based on prices or valuation models that require inputs that are both significant to the fair value measurement and less observable from objective sources.
|
|
September 30, 2018
|
|
December 31, 2017
|
|
Classification
|
||||
|
|
|
|
|
|
||||
|
($ in thousands)
|
|
|
||||||
Warrant liability
|
$
|
912
|
|
|
$
|
2,811
|
|
|
Other long-term liabilities
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
Classification
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
((income) expense $ in thousands)
|
|
|
||||||||||||||
Interest rate swaps
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
(62
|
)
|
|
Interest expense, net
|
Warrant
|
(1,467
|
)
|
|
(900
|
)
|
|
(1,899
|
)
|
|
(3,212
|
)
|
|
Other expense (income)
|
||||
|
$
|
(1,467
|
)
|
|
$
|
(898
|
)
|
|
$
|
(1,899
|
)
|
|
$
|
(3,274
|
)
|
|
|
|
Nine Months Ended September 30,
|
|
||||||
|
2018
|
|
2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Cash paid for interest, net of capitalized interest
|
$
|
13,878
|
|
|
$
|
10,934
|
|
|
Cash paid for income taxes, net of refunds
|
$
|
28
|
|
|
$
|
(22
|
)
|
|
Issuance of equity
|
$
|
5,974
|
|
|
$
|
—
|
|
|
Purchases of PP&E accrued but not paid at period-end
|
$
|
7,670
|
|
|
$
|
1,432
|
|
|
Purchases of PP&E accrued in a prior period and paid in the current period
|
$
|
11,372
|
|
|
$
|
170
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
($ in thousands)
|
|||||||||||||||
Revenues
|
$
|
62,961
|
|
|
$
|
103,215
|
|
|
$
|
271,553
|
|
|
$
|
261,161
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
||||||||
Cost of goods sold (excluding depreciation, depletion and amortization)
|
52,337
|
|
|
80,239
|
|
|
205,229
|
|
|
223,978
|
|
|
||||
Depreciation, depletion and amortization
|
5,316
|
|
|
6,078
|
|
|
15,532
|
|
|
16,409
|
|
|
||||
Selling, general and administrative expenses
|
3,693
|
|
|
7,302
|
|
|
19,654
|
|
|
20,030
|
|
|
||||
Contract and project terminations
|
—
|
|
|
—
|
|
|
1,689
|
|
|
—
|
|
|
||||
Total operating expenses
|
61,346
|
|
|
93,619
|
|
|
242,104
|
|
|
260,417
|
|
|
||||
Operating income (loss)
|
1,615
|
|
|
9,596
|
|
|
29,449
|
|
|
744
|
|
|
||||
Other expense (income):
|
|
|
|
|
|
|
—
|
|
|
|
|
|
||||
Interest expense, net
|
6,907
|
|
|
5,073
|
|
|
24,135
|
|
|
13,353
|
|
|
||||
Other
|
(1,472
|
)
|
|
(901
|
)
|
|
(1,930
|
)
|
|
(3,218
|
)
|
|
||||
Total other expense
|
5,435
|
|
|
4,172
|
|
|
22,205
|
|
|
10,135
|
|
|
||||
Income (loss) from continuing operations before provision for income taxes
|
(3,820
|
)
|
|
5,424
|
|
|
7,244
|
|
|
(9,391
|
)
|
|
||||
Provision (benefit) for income taxes
|
33
|
|
|
(58
|
)
|
|
183
|
|
|
(58
|
)
|
|
||||
Net income (loss) from continuing operations
|
(3,853
|
)
|
|
5,482
|
|
|
7,061
|
|
|
(9,333
|
)
|
|
||||
Income (loss) from discontinued operations, net of taxes
|
—
|
|
|
(468
|
)
|
|
—
|
|
|
(3,125
|
)
|
|
||||
Net income (loss)
|
$
|
(3,853
|
)
|
|
$
|
5,014
|
|
|
$
|
7,061
|
|
|
$
|
(12,458
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted EBITDA (a)
|
$
|
7,927
|
|
|
$
|
18,743
|
|
|
$
|
48,675
|
|
|
$
|
26,345
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
($ in thousands)
|
|||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Frac sand revenues
|
$
|
61,597
|
|
|
$
|
101,795
|
|
|
$
|
268,356
|
|
|
$
|
258,055
|
|
|
Non-frac sand revenues
|
1,364
|
|
|
1,420
|
|
|
3,197
|
|
|
3,106
|
|
|
||||
Total revenues
|
62,961
|
|
|
103,215
|
|
|
271,553
|
|
|
261,161
|
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
|
||||||||
Cost of goods sold (excluding depreciation, depletion and amortization)
|
52,337
|
|
|
80,239
|
|
|
205,229
|
|
|
223,978
|
|
|
||||
Depreciation, depletion and amortization
|
5,316
|
|
|
6,078
|
|
|
15,532
|
|
|
16,409
|
|
|
||||
Selling, general and administrative expenses
|
3,693
|
|
|
7,302
|
|
|
19,654
|
|
|
20,030
|
|
|
||||
Contract and project terminations
|
—
|
|
|
—
|
|
|
1,689
|
|
|
—
|
|
|
||||
Operating income (loss)
|
$
|
1,615
|
|
|
$
|
9,596
|
|
|
$
|
29,449
|
|
|
$
|
744
|
|
|
Net income (loss) from continuing operations
|
$
|
(3,853
|
)
|
|
$
|
5,482
|
|
|
$
|
7,061
|
|
|
$
|
(9,333
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted EBITDA (a)
|
$
|
7,927
|
|
|
$
|
18,743
|
|
|
$
|
48,675
|
|
|
$
|
26,345
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Volume of frac sand sold (tons in thousands)
|
985
|
|
|
1,361
|
|
|
3,941
|
|
|
3,890
|
|
|
||||
Volume of non-frac sand sold (tons in thousands)
|
88
|
|
|
119
|
|
|
224
|
|
|
233
|
|
|
||||
Total volume of sand sold (tons in thousands)
|
1,073
|
|
|
1,480
|
|
|
4,165
|
|
|
4,123
|
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Terminal sand sales (tons in thousands)
|
247
|
|
|
671
|
|
|
1,249
|
|
|
1,803
|
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Volume of frac sand produced by plant (tons in thousands):
|
|
|
|
|
|
|
|
|
||||||||
Arland, Wisconsin facility
|
161
|
|
|
463
|
|
|
1,061
|
|
|
1,339
|
|
|
||||
Barron, Wisconsin facility
|
353
|
|
|
497
|
|
|
1,360
|
|
|
1,547
|
|
|
||||
New Auburn, Wisconsin facility
|
210
|
|
|
346
|
|
|
865
|
|
|
965
|
|
|
||||
San Antonio, Texas facility (b)
|
223
|
|
|
16
|
|
|
391
|
|
|
16
|
|
|
||||
Kosse, Texas facility
|
95
|
|
|
53
|
|
|
302
|
|
|
165
|
|
|
||||
Total volume of frac sand produced
|
1,042
|
|
|
1,375
|
|
|
3,979
|
|
|
4,032
|
|
|
•
|
$20.3 million decrease in northern white sales (excluding estimated transportation markups), relating primarily to a 49% decrease in volumes sold, offset by $12.3 million increase of Texas sand sales mainly due to the addition of our San Antonio operation in July 2017; and
|
•
|
an estimated $32.3 million decrease in markups due to lower volumes sold through terminals.
|
•
|
$22.1 million decrease in rail transportation-related expense, primarily due to decreased rail shipping costs resulting from decreased terminal sales volumes;
|
•
|
$4.2 million decrease in costs of transload facilities due to decreased volumes; and
|
•
|
$1.6 million decrease in the total cost to acquire and produce sand due to
28%
decrease in total volumes sold, offset by higher start up costs for our San Antonio plant.
|
•
|
$4.9 million increase due to $175 million additional notes issued under the Second Lien Note Purchase Agreement; offset by
|
•
|
$2.5 million decreased interest expense due to the reduction of outstanding balances under the revolving credit facility; and
|
•
|
$0.6 million interest capitalized for the construction of the San Antonio plants.
|
•
|
$35.4 million increase in sales (excluding estimated transportation markups), relating primarily to improved pricing for frac sand, and addition of our San Antonio operation in July 2017; offset by
|
•
|
an estimated $25.1 million decrease in markups due to decreased terminal sales volumes.
|
•
|
$27.4 million decrease in rail transportation-related expense, primarily due to:
|
•
|
$26.0 million decreased rail shipping costs due to decreased terminal sales volumes sold and the shift in mix between direct FOB plant sales and terminal sand sales; and
|
•
|
$1.2 million decreased railcar storage costs as we had placed previously stored cars back into service.
|
•
|
$4.6 million decrease in costs of transload facilities due to decreased volumes, offset by
|
•
|
$13.2 million increase in the total cost to acquire and produce wet and dry sand, due mainly to higher startup costs at our San Antonio plant.
|
•
|
$2.7 million decrease in employee-related costs mainly due to reduced bonus accruals in 2018, and employee equity- based compensation; offset by
|
•
|
$1.1 million expenses related to the long-term debt refinancing in January 2018;
|
•
|
$15.6 million increase due to a $215 million addition of the notes issued under the Second Lien Note Purchase Agreement; and
|
•
|
$3.9 million write-off of deferred financing costs relating to the reduction of our revolving credit facility in January 2018; offset by
|
•
|
$6.8 million decreased interest expense due to the reduction of outstanding balances under the revolving credit facility; and
|
•
|
$1.7 million interest capitalized for the construction of the San Antonio plants.
|
•
|
a minimum liquidity requirement of
$20.0 million
at all times;
|
•
|
beginning with the fiscal quarter ending March 31, 2018, a total leverage ratio of a maximum of
5.50
:1.00 decreasing quarterly thereafter to
3.00
:1.00 for the fiscal quarter ending December 31, 2018, and thereafter;
|
•
|
beginning with the fiscal quarter ending March 31, 2018, a minimum fixed charge coverage ratio of
1.10
:1.00; and
|
•
|
a limit on capital expenditures, subject to certain availability thresholds.
|
•
|
a minimum liquidity requirement of
$20.0 million
at all times;
|
•
|
beginning with the fiscal quarter ending March 31, 2018, a total leverage ratio of a maximum of
6.00
:1.00 decreasing quarterly thereafter to
3.00
:1.00 for the fiscal quarter ending March 31, 2019, and thereafter;
|
•
|
beginning with the fiscal quarter ending March 31, 2018, a minimum fixed charge coverage ratio of
1.10
:1.00, increasing quarterly to
2.00
:1.00 for the fiscal quarter ending March 31, 2019, and thereafter; and
|
•
|
a limit on capital expenditures, subject to certain availability thresholds.
|
|
Nine Months Ended September 30,
|
|
||||||
|
2018
|
|
2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Cash flows from operating activities
|
$
|
48,390
|
|
|
$
|
(13,887
|
)
|
|
Cash flows from investing activities
|
$
|
(63,320
|
)
|
|
$
|
(25,658
|
)
|
|
Cash flows from financing activities
|
$
|
12,026
|
|
|
$
|
40,090
|
|
|
Cash and cash equivalents at beginning of period
|
$
|
5,729
|
|
|
$
|
4
|
|
|
Cash and cash equivalents at end of period
|
$
|
2,825
|
|
|
$
|
549
|
|
|
|
Nine Months Ended September 30,
|
|
||||||
|
2018
|
|
2017
|
|
||||
|
|
|
|
|
||||
|
($ in thousands)
|
|
||||||
Net debt proceeds (payments)
|
$
|
25,418
|
|
|
$
|
45,400
|
|
|
Payment of financing costs
|
(11,971
|
)
|
|
(3,024
|
)
|
|
||
Other
|
(1,421
|
)
|
|
(2,286
|
)
|
|
||
Total
|
$
|
12,026
|
|
|
$
|
40,090
|
|
|
•
|
our debt covenant compliance. Adjusted EBITDA is a key component of critical covenants to our Credit Agreement;
|
•
|
the financial performance of our assets without regard to the impact of financing methods, capital structure or historical cost basis of our assets;
|
•
|
the viability of capital expenditure projects and the overall rates of return on alternative investment opportunities;
|
•
|
our liquidity position and the ability of our assets to generate cash sufficient to make debt payments and to make distributions; and
|
•
|
our operating performance as compared to those of other companies in our industry without regard to the impact of financing methods and capital structure.
|
|
Continuing
|
|
Discontinued
|
|
Consolidated
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Three Months Ended September 30,
|
|
||||||||||||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
($ in thousands)
|
|
||||||||||||||||||||||
Net income (loss)
|
$
|
(3,853
|
)
|
|
$
|
5,482
|
|
|
$
|
—
|
|
|
$
|
(468
|
)
|
|
$
|
(3,853
|
)
|
|
$
|
5,014
|
|
|
Interest expense, net
|
6,907
|
|
|
5,073
|
|
|
—
|
|
|
—
|
|
|
6,907
|
|
|
5,073
|
|
|
||||||
Depreciation, depletion and amortization
|
5,316
|
|
|
6,078
|
|
|
—
|
|
|
—
|
|
|
5,316
|
|
|
6,078
|
|
|
||||||
Provision (benefit) for income taxes
|
33
|
|
|
(58
|
)
|
|
—
|
|
|
—
|
|
|
33
|
|
|
(58
|
)
|
|
||||||
EBITDA
|
8,403
|
|
|
16,575
|
|
|
—
|
|
|
(468
|
)
|
|
8,403
|
|
|
16,107
|
|
|
||||||
Equity-based compensation expense
|
364
|
|
|
343
|
|
|
—
|
|
|
—
|
|
|
364
|
|
|
343
|
|
|
||||||
Reduction in escrow receivable
|
—
|
|
|
—
|
|
|
—
|
|
|
468
|
|
|
—
|
|
|
468
|
|
|
||||||
Provision for doubtful accounts
|
287
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
287
|
|
|
—
|
|
|
||||||
Accretion expense
|
30
|
|
|
25
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|
25
|
|
|
||||||
Retirement of assets
|
123
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
123
|
|
|
—
|
|
|
||||||
Other state and local taxes
|
395
|
|
|
477
|
|
|
—
|
|
|
—
|
|
|
395
|
|
|
477
|
|
|
||||||
Non-cash deferred lease expense
|
(208
|
)
|
|
2,223
|
|
|
—
|
|
|
—
|
|
|
(208
|
)
|
|
2,223
|
|
|
||||||
Unrealized loss (gain) on fair value of warrant
|
(1,467
|
)
|
|
(900
|
)
|
|
—
|
|
|
—
|
|
|
(1,467
|
)
|
|
(900
|
)
|
|
||||||
Adjusted EBITDA
|
$
|
7,927
|
|
|
$
|
18,743
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,927
|
|
|
$
|
18,743
|
|
|
|
Continuing
|
|
Discontinued
|
|
Consolidated
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Nine Months Ended September 30,
|
|
||||||||||||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
($ in thousands)
|
|
||||||||||||||||||||||
Net income (loss)
|
$
|
7,061
|
|
|
$
|
(9,333
|
)
|
|
$
|
—
|
|
|
$
|
(3,125
|
)
|
|
$
|
7,061
|
|
|
$
|
(12,458
|
)
|
|
Interest expense, net
|
24,135
|
|
|
13,353
|
|
|
—
|
|
|
—
|
|
|
24,135
|
|
|
13,353
|
|
|
||||||
Depreciation, depletion and amortization
|
15,532
|
|
|
16,409
|
|
|
—
|
|
|
—
|
|
|
15,532
|
|
|
16,409
|
|
|
||||||
Provision (benefit) for income taxes
|
183
|
|
|
(58
|
)
|
|
—
|
|
|
—
|
|
|
183
|
|
|
(58
|
)
|
|
||||||
EBITDA
|
46,911
|
|
|
20,371
|
|
|
—
|
|
|
(3,125
|
)
|
|
46,911
|
|
|
17,246
|
|
|
||||||
Equity-based compensation expense
|
1,224
|
|
|
1,020
|
|
|
—
|
|
|
—
|
|
|
1,224
|
|
|
1,020
|
|
|
||||||
Contract and project terminations
|
1,689
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,689
|
|
|
—
|
|
|
||||||
Reduction in escrow receivable
|
—
|
|
|
—
|
|
|
—
|
|
|
3,125
|
|
|
—
|
|
|
3,125
|
|
|
||||||
Provision for doubtful accounts
|
310
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
310
|
|
|
—
|
|
|
||||||
Accretion expense
|
92
|
|
|
83
|
|
|
—
|
|
|
—
|
|
|
92
|
|
|
83
|
|
|
||||||
Retirement of assets
|
443
|
|
|
60
|
|
|
—
|
|
|
—
|
|
|
443
|
|
|
60
|
|
|
||||||
Other state and local taxes
|
1,185
|
|
|
1,357
|
|
|
—
|
|
|
—
|
|
|
1,185
|
|
|
1,357
|
|
|
||||||
Non-cash deferred lease expense
|
(2,429
|
)
|
|
6,453
|
|
|
—
|
|
|
—
|
|
|
(2,429
|
)
|
|
6,453
|
|
|
||||||
Unrealized (gain) loss on fair value of warrant
|
(1,899
|
)
|
|
(3,212
|
)
|
|
—
|
|
|
—
|
|
|
(1,899
|
)
|
|
(3,212
|
)
|
|
||||||
Other adjustments allowable under our Credit Agreement
|
1,149
|
|
|
213
|
|
|
—
|
|
|
—
|
|
|
1,149
|
|
|
213
|
|
|
||||||
Adjusted EBITDA
|
$
|
48,675
|
|
|
$
|
26,345
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
48,675
|
|
|
$
|
26,345
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
($ in thousands)
|
|
||||||||||||||
Adjusted EBITDA
|
$
|
7,927
|
|
|
$
|
18,743
|
|
|
$
|
48,675
|
|
|
$
|
26,345
|
|
|
Interest expense, net
|
(5,852
|
)
|
|
(4,169
|
)
|
|
(17,538
|
)
|
|
(10,828
|
)
|
|
||||
Income tax expense
|
(429
|
)
|
|
(419
|
)
|
|
(1,369
|
)
|
|
(1,299
|
)
|
|
||||
Other adjustments allowable under our Credit Agreement
|
—
|
|
|
—
|
|
|
(1,149
|
)
|
|
(213
|
)
|
|
||||
Cost to retire assets
|
(19
|
)
|
|
—
|
|
|
(19
|
)
|
|
19
|
|
|
||||
Non-cash deferred lease expense
|
208
|
|
|
(2,223
|
)
|
|
2,429
|
|
|
(6,453
|
)
|
|
||||
Change in other operating assets and liabilities
|
10,453
|
|
|
(18,646
|
)
|
|
17,361
|
|
|
(21,458
|
)
|
|
||||
Cash flows from operating activities:
|
$
|
12,288
|
|
|
$
|
(6,714
|
)
|
|
$
|
48,390
|
|
|
$
|
(13,887
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cash flows from investing activities:
|
$
|
(7,544
|
)
|
|
$
|
(2,036
|
)
|
|
$
|
(63,320
|
)
|
|
$
|
(25,658
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cash flows from financing activities:
|
$
|
(3,035
|
)
|
|
$
|
9,110
|
|
|
$
|
12,026
|
|
|
$
|
40,090
|
|
|
Exhibit
Number
|
|
Description
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
101*
|
|
Interactive Data Files - XBRL.
|
|
|
EMERGE ENERGY SERVICES LP
|
||
|
|
|
|
|
By:
|
EMERGE ENERGY SERVICES GP LLC, its general partner
|
|
|
|
|
|
|
By:
|
/s/ Rick Shearer
|
|
|
|
Rick Shearer
|
|
|
|
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
By:
|
/s/ Deborah Deibert
|
|
|
|
Deborah Deibert
|
|
|
|
Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|
|
1 Year EMERGE ENERGY SERVICES LP Chart |
1 Month EMERGE ENERGY SERVICES LP Chart |
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