Hi-Crush Partners’ Sand Volumes Rose 16% in Q2 2018



Hi-Crush Partners’ second-quarter results

Hi-Crush Partners (HCLP) reported its second-quarter results on July 31 after the markets closed. The company reported an adjusted EBITDA of $81.5 million—compared to $64.5 million in the first quarter. Growth in sand volumes sold and improved pricing drove the earnings growth. The contribution margin rose to $30.94 per ton in the second quarter—compared to $29.08 per ton in the first quarter.

According to the company, the contribution margin is the total revenues less the costs of goods sold excluding depreciation, depletion, and amortization. As the above graph shows, the sales volumes rose 16% sequentially. Hi-Crush Partners expects its sales volumes to be 3.0 million tons–3.2 million tons in the third quarter.

“Our PropStream last mile logistics service continues to gain market share with customers we are targeting, which are the end users of sand, the E&Ps,” said Robert E. Rasmus, Hi-Crush Partners’ CEO.

“In addition to strong PropStream results, our operations benefited from an improvement in Class-1 rail service and less railroad congestion in the second quarter of 2018 relative to the first quarter,” added Rasmus.

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Hi-Crush Partners’ DCF (distributable cash flow) attributable to limited partners was $66.6 million for the quarter. The DCF attributable to IDR holders was $7.8 million. Hi-Crush Partners declared a distribution of $0.75 per unit for the second quarter. The declared distribution amount is $66.3 million for limited partners and $7.6 million for general partners and IDRs.

“As we continue to evaluate conversion from an MLP to a C-Corp, this increase in the distribution for the second quarter also enables us to begin heading down one path of several that can facilitate a corporate structure conversion,” noted Laura C. Fulton, Hi-Crush Partners’ CFO.

Emerge Energy Services (EMES) is scheduled to conduct its second-quarter earnings call on August 1. MPLX (MPLX) reported strong second-quarter results. Read What Drove MPLX’s Earnings Growth in Q2 2018? to learn more.


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