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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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26-3718801
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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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Title of each class:
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Name of each exchange on which registered:
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Common Stock, par value $0.01 per share
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New York Stock Exchange
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Large accelerated filer
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ý
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Accelerated filer
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Non-accelerated filer
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¨
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Smaller reporting company
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Emerging growth company
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•
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fluctuations in demand for commercial silica, diatomaceous earth, perlite, clay and cellulose;
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the cyclical nature of our customers’ businesses;
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operating risks that are beyond our control, such as changes in the price and availability of transportation, transload network access, natural gas or electricity; unusual or unexpected geological formations or pressures; pit wall failures, underground roof falls or rock falls; or unanticipated ground, grade or water conditions;
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our dependence on five of our plants for a significant portion of our sales;
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the level of activity in the natural gas and oil industries;
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fluctuations in demand or prices for frac sand or the development of either effective alternative proppants or new processes to replace hydraulic fracturing;
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federal, state and local legislative and regulatory initiatives relating to hydraulic fracturing and the potential for related regulatory action or litigation affecting our customers’ operations;
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our rights and ability to mine our properties and our renewal or receipt of the required permits and approvals from governmental authorities and other third parties;
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our ability to implement our capacity expansion plans within our current timetable and budget and our ability to secure demand for our increased production capacity, and the actual operating costs once we have completed the capacity expansion;
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our ability to succeed in competitive markets;
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loss of, or reduction in, business from our largest customers;
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operational, regulatory and other risks as a result of our international sales and operations;
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increasing costs or a lack of dependability or availability of transportation services and transload network access or infrastructure;
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extensive regulation of trucking services;
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our ability to recruit and retain truckload drivers;
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increases in the prices of, or interruptions in the supply of, natural gas and electricity, or any other energy sources;
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increases in the price of diesel fuel;
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diminished access to water;
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our ability to successfully complete acquisitions or integrate acquired businesses;
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our ability to make capital expenditures to maintain, develop and increase our asset base and our ability to obtain needed capital or financing on satisfactory terms;
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our substantial indebtedness and pension obligations;
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restrictions imposed by our indebtedness on our current and future operations;
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our ability to comply with contractual obligations that require us to deliver minimum amounts of frac sand, sometimes with certain quality specifications, or purchase minimum amounts of services;
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the accuracy of our estimates of mineral reserves and resource deposits;
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a shortage of skilled labor and rising costs in the mining industry;
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our ability to attract and retain key personnel;
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our ability to maintain satisfactory labor relations;
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our reliance on patents, trade secrets, trademarks, and contractual restrictions to protect our proprietary rights;
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our significant unfunded pension obligations and post-retirement health care liabilities;
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our ability to maintain effective quality control systems at our mining, processing and production facilities;
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seasonal and severe weather conditions;
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fluctuations in our sales and results of operations due to seasonality and other factors;
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interruptions or failures in our information technology systems, due to cybersecurity breaches or for other reasons;
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•
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the impact of a terrorist attack or armed conflict;
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extensive and evolving environmental, mining, health and safety, licensing, reclamation, climate change and other regulation (and changes in their enforcement or interpretation);
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silica-related health issues and corresponding litigation;
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our ability to acquire, maintain or renew financial assurances related to the reclamation and restoration of mining property;
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the impact of the above factors and other future events on the market price and trading volume of our common stock; and
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other factors included and disclosed in Part I, Item 1A. Risk Factors, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and elsewhere in this Annual Report on Form 10-K.
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ITEM 1.
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BUSINESS
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•
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Large-scale producer with a diverse and high-quality reserve base
.
Our
27
geographically dispersed operating production facilities control an estimated
627 million
tons of reserves, including API size frac sand and large quantities of silica with distinct characteristics, and an estimated
56 million
tons of reserves of diatomaceous earth, perlite, and clays. These reserves give us the ability to sell over
400
product types to customers in both our Oil & Gas Proppants segment and Industrial & Specialty Products segment. We believe our large-scale production, logistics capabilities and long reserve life make us a preferred supplier to our customers. Our consistent, reliable supply of reserves gives our customers the security to customize their production processes around our products.
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Geographically advantaged footprint with intrinsic transportation advantages.
We believe the strategic location of our facilities and our logistics capabilities, including those obtained through strategic acquisitions discussed elsewhere in this Annual Report on Form 10-K, contribute to our customer retention rates and our ability to reach broader market segments. In our Oil & Gas Proppants segment, our network of frac sand production facilities with access to Class I rail either onsite or by truck, combined with the strategic locations of our transloads, enable us to serve every major U.S. shale basin. Additionally, our acquisition of SandBox extends our delivery capability directly to our customers' wellhead locations. We believe we are one of the few frac sand producers capable of cost-effectively delivering API grade frac sand to most of the major U.S. shale basins by on-site rail.
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Low-cost operating structure.
We focus on building and operating facilities with low delivered cost to enable us to better manage through market downturns. We believe the combination of the following factors contributes to our goal of having a low-cost structure and high margins:
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•
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our ownership of the vast majority of our reserves, resulting in mineral royalty expense that was less than
0.1%
of our sales in
2018
;
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the optimal positioning of our mines and their respective processing plants, enabling cost-efficient and highly automated production processes;
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our processing expertise, which enables us to create over
400
product types with unique characteristics while minimizing waste;
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our integrated logistics management expertise and geographically advantaged facility network, which enables us to reliably ship products by the most cost-effective method available, whether by truck, rail or barge, to meet the needs of our customers, whether at in-basin transload locations or directly at wellhead locations via our Sandbox operations, whether domestic or overseas;
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our large customer base across numerous end markets, which allows us to maximize our mining recovery rate and asset utilization; and
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our large overall and plant-level operating scale.
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Strong reputation with our customers and the communities in which we operate.
We believe we have built a strong reputation during our
119
-year operating history. We have a long track record of timely delivery of our products according to customer specifications, which we believe contributes to a reputation for dependability and high-quality, innovative products. We also have an extensive network of technical resources, including materials science and petroleum engineering expertise, which enables us to collaborate with our customers to develop new products and improve the performance of their existing applications. We also believe we are known in the communities in which we operate as a preferred employer and a responsible corporate citizen, which generally serves us well in hiring new employees and securing difficult to obtain permits for expansions and new facilities.
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Commitment to innovation.
Our team is dedicated to continuing to develop patentable products through research and development. The acquisition of EPM has accelerated our team’s research and development efforts by providing additional expertise and testing equipment, such as experience with filtration and with high temperature manufacturing processes.
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Experienced management team
.
The members of our senior management team bring significant experience to the dynamic environment in which we operate. Their expertise covers a range of disciplines, including industry-specific operating and technical knowledge as well as experience managing high-growth businesses. We believe we have assembled a flexible, creative and responsive team that can quickly adapt to the rapidly evolving unconventional oil and natural gas landscape.
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Increase our presence and product offering in specialty products end markets.
Our research and business development teams work to enhance our existing products, develop new products and pursue opportunities to acquire new product offerings through business acquisitions, which we expect will increase our presence and market share in certain specialty products end markets and allow us to enter new markets. We manage a robust pipeline of new products in various stages of development. On May 1, 2018, we completed the acquisition of EPM, a global producer of industrial minerals, including diatomaceous earth, clay and perlite, which increased our industrial materials product offerings.
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Optimize product mix and further develop value-added capabilities to maximize margins.
We continue to actively manage our product mix at each of our plants as we seek to maximize our profit margins. This requires us to use our proprietary expertise in balancing key variables, such as mine geology, processing capacities, transportation availability, customer requirements and pricing. We expect to continue investing in ways to increase the value we provide to our customers by expanding our product offerings, improving our supply chain management, upgrading our information technology, and enhancing our customer service model.
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Effectively position our Oil & Gas Proppants facilities to optimally serve our customers.
We continuously execute initiatives to increase the effectiveness and efficiency of our frac sand production facilities. Our mix of Northern White, regional, and local in-basin mines are positioned to provide a full range of frac sand products to our customers. We are also constantly undergoing continuous improvement efforts to reduce production costs at our facilities.
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Optimize our supply chain network and leverage our logistics capabilities to meet our customers’ needs.
We continue to strategically position our supply chain in order to deliver sand according to our customers’ needs, whether at a plant, a transload or the wellhead. We believe that our supply chain network and logistics capabilities are a competitive advantage that enables us to provide superior service for our customers.
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Our acquisition of Sandbox extends our delivery capability directly to our customers' wellhead locations, which increases efficiency and provides a lower cost logistics solution for our customers. Sandbox has operations in the major United States oil and gas producing regions, including Texas, New Mexico, Oklahoma, the Rocky Mountains and the Northeast, where their largest customers are located.
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We manage our transload network through partnerships rather than owned transloads because we believe this approach enables us to receive high quality service from our specialized transloading partners without the significant capital investment related to owning the assets. As of
December 31, 2018
, we have storage capacity at
51
transloads located near all of the major shale basins in the United States.
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Evaluate both Greenfield and Brownfield expansion opportunities and other acquisitions.
We expect to continue leveraging our reputation, processing capabilities and infrastructure to increase production, as well as explore other opportunities to expand our reserve base and sell new products.
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We have completed several Greenfield projects that became operational in 2018. In May 2017, we purchased a Greenfield site in Crane County, Texas, which became operational during the first quarter of 2018 and which we expect will eventually produce approximately 4 million tons of annual frac sand capacity. Additionally, in July 2017, we purchased a Greenfield site near Lamesa, Texas, which became operational during the third quarter of 2018 and which we expect will eventually produce approximately 6 million tons of annual frac sand capacity.
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◦
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We are continuing to actively pursue acquisitions to grow. Our primary objective is to acquire value adding products in our Industrial & Specialty Products segment, and assets that are complementary to our current offering for our Oil & Gas Proppants segment. We prioritize acquisitions that provide opportunities to realize synergies, including entering new geographic markets, acquiring attractive customer contracts and improving operations. For example, on December 31, 2018, we completed our acquisition of a manufacturing facility located in Millen, Georgia. This facility has a kiln, which will allow for the production of specialty industrial products that require high temperature heat treatments. See the descriptions of other recent and notable acquisitions under “Business Overview-Acquisitions” above. See the risk factors disclosed in Item 1A of Part I of this Annual Report on Form 10-K for a description of certain risks related to our acquisition activities.
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•
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Maintain financial strength and flexibility
.
We intend to maintain financial strength and flexibility to enable us to better manage through industry downturns and pursue acquisitions and new growth opportunities as they arise. In connection with the EPM acquisition, on May 1, 2018, we entered into a Third Amended and Restated Credit Agreement (the "Credit Agreement") with BNP Paribas, as administrative agent, and the lenders named therein. The Credit Agreement increased our then existing senior debt by establishing a new $1.380 billion senior secured credit facility, consisting of a $1.280 billion term loan (the “Term Loan”) and a $100 million revolving credit facility (the “Revolver”) (collectively the "Credit Facility) that may also be used for swingline loans or letters of credit, and we may elect to increase the term loan in accordance with the terms of the Credit Agreement. For more information on the Credit Agreement see Note K - Debt to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K. As of
December 31, 2018
, we had
$202.5 million
of cash on hand and
$95.2 million
of availability under the Revolver.
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•
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Sales—
Our sales team is organized by both region and end market. We have an experienced group of dedicated sales team members for the oil and gas proppants and the industrial and specialty products end markets. Our oil and gas proppants team is led out of our Katy and Houston offices and is regionally positioned in the major oil and gas markets across the United States. This staff consists of experienced experts in the use of frac proppants in the oil and gas industry. Our industrial and specialty products sales team is strategically located across the county and overseas near our major customers. As we make decisions to enter or expand our presence in certain end markets or regions, we expect we will continue to add dedicated team members to support that growth.
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•
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Marketing—
Our marketing team coordinates all of our new and existing customer outreach efforts and identifies emerging market trends and new product opportunities. This includes producing exhibits for trade shows and exhibitions, manufacturing product overview materials, participating in regional industry meetings and other trade associations and managing our advertising efforts in trade journals.
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•
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Transportation and Logistics—
Our transportation and logistics team manages domestic and international shipments and wellhead deliveries of frac sand by directing inbound and outbound rail, barge, ocean vessel and truck traffic, supervising equipment maintenance, coordinating with freight carriers to ensure equipment availability, ensuring compliance with shipping regulations and strategically planning for future growth.
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•
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Technical—
Our technical team is anchored by our industrial & specialty products laboratory in Berkeley Springs, West Virginia and our research and development laboratory in Reno, Nevada. At these facilities, we perform a variety of analyses including:
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•
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analytical chemistry by X-Ray Fluorescence (“XRF”) and Inductively Coupled Plasma (“ICP”) spectroscopy;
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•
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particle characterization by sieve, SediGraph, Brunauer, Emmett and Teller (“BET”) surface area and microscopy;
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•
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ore evaluation by mineral processing, flotation and magnetic separation;
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•
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API frac sand evaluation, including crush resistance; and
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•
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American Foundry Society (“AFS”) green sand evaluation by various foundry sand tests.
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Expert geologists and engineers for desirable ore-body and processing evaluations;
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Material analysis and formulation assistance by Ph.D. chemists; and
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◦
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An array of testing capabilities
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•
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Customer Service—
Our customer service team is dedicated to creating an exceptional customer experience and making it easy to do business with our company. Our customer service team aims to accomplish this by consistently exceeding our customers’ expectations, continually improving our performance, offering efficient and timely responses to customer needs, being available to our customers 24/7 and providing customers with personal points of contact on whom they can rely.
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ITEM 1A.
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RISK FACTORS
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•
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changes in the price and availability of transportation and transload network access;
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•
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changes in the price and availability of natural gas or electricity;
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•
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changes in the price and availability of water;
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•
|
unanticipated ground, grade or water conditions;
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•
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unusual or unexpected geological formations or pressures;
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•
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pit wall failures, underground roof falls or surface rock falls;
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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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physical plant security breaches;
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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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nonperformance of contractual obligations;
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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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restrictions on blasting operations;
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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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technical difficulties or key equipment failures;
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•
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labor disputes, including union strikes;
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•
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cybersecurity breaches;
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•
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late delivery of supplies;
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•
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fires, explosions or other accidents; and
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•
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facility shutdowns in response to environmental regulatory actions.
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•
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demand for oil, natural gas and petroleum products;
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•
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fluctuations in energy, fuel, oil and natural gas prices and the availability of such fuels;
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•
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our ability to successfully implement price increases and surcharges;
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•
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fluctuations in currency;
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•
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the use of alternative proppants, such as ceramic proppants, in the hydraulic fracturing process;
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•
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global and regional economic, political and military events and conditions;
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•
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changes in residential and commercial construction demands, driven in part by fluctuating interest rates and demographic shifts;
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•
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demand for automobiles and other vehicles;
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•
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substitution for diatomaceous earth, perlite and clay;
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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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the substitution of plastic or other materials for glass;
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•
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changes in trade agreements and/or tariffs for qualifying imports and exports;
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•
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the use of recycled glass in glass production;
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•
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competition from offshore producers of glass products;
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•
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changes in demand for our products due to technological innovations, including the development and use of new processes for oil and gas production that do not require proppants;
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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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overall tax rate of the business, which may be affected by a number of factors, including the use of tax attributes and the financial results of our international subsidiaries;
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prices, availability and other factors relating to our products; and
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increases in costs of labor and labor strikes.
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ITEM 1B.
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UNRESOLVED STAFF COMMENTS
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ITEM 2.
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PROPERTIES
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Proven (measured) reserves.
Reserves for which (1) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes; grade and/or quality are computed from the results of detailed sampling and (2) the sites for inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that size, shape, depth and mineral content of reserves are well-established.
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•
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Probable (indicated) reserves.
Reserves for which quantity and grade and/or quality are computed from information similar to that used for proven (measured) reserves, but the sites for inspection, sampling, and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observation.
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Mine/Plant Location
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Acreage Owned/Leased
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Proven Reserves
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Probable Reserves
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Combined Proven and Probable Reserves
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Estimated Processing Recovery Percentages
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2018 Tons Mined
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Primary End Markets Served
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(in acres)
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(tonnage data in thousands)
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Crane County, TX
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3200 owned
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122,777
|
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47,500
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170,277
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73
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%
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1,123
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Oil and gas proppants
(3)
|
Lamesa, TX
|
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3523 owned
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101,695
|
|
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16,300
|
|
|
117,995
|
|
|
58
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%
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|
1,205
|
|
|
Oil and gas proppants
(3)
|
Festus, MO
|
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635 leased
|
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16,318
|
|
|
7,411
|
|
|
23,729
|
|
|
84
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%
|
|
1,796
|
|
|
Oil and gas proppants
(3)
|
Ottawa, IL
|
|
2,100 owned
|
|
123,778
|
|
|
—
|
|
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123,778
|
|
|
89
|
%
|
|
4,093
|
|
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Oil and gas proppants
(3)
, glass, chemicals, foundry
(4)
|
Voca, TX
|
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1,061 owned
|
|
22,793
|
|
|
19,080
|
|
|
41,873
|
|
|
30
|
%
|
|
2,669
|
|
|
Oil and gas proppants
(3)
|
Tyler, TX
|
|
1356 owned
|
|
—
|
|
|
17,898
|
|
|
17,898
|
|
|
72
|
%
|
|
1,932
|
|
|
Oil and gas proppants
(3)
|
Mill Creek, OK
|
|
2,174 owned
16 mineral lease |
|
—
|
|
|
13,550
|
|
|
13,550
|
|
|
61
|
%
|
|
2,437
|
|
|
Oil and gas proppants
(3)
, glass, foundry, building products
(4)
|
Sparta, WI
|
|
660 owned
|
|
22,930
|
|
|
2,740
|
|
|
25,670
|
|
|
85
|
%
|
|
1,996
|
|
|
Oil and gas proppants
(3)
|
Utica, IL
|
|
148 owned
|
|
7,363
|
|
|
—
|
|
|
7,363
|
|
|
88
|
%
|
|
2,152
|
|
|
Oil and gas proppants
(3)
|
Mapleton Depot, PA
|
|
1,761 owned
194 mineral lease 98 access lease |
|
1,989
|
|
|
2,100
|
|
|
4,089
|
|
|
81
|
%
|
|
683
|
|
|
Glass, building products
(4)
|
Pacific, MO
|
|
524 owned
|
|
13,175
|
|
|
7,994
|
|
|
21,169
|
|
|
83
|
%
|
|
1,255
|
|
|
Oil and gas proppants
(3)
, glass, foundry, fillers and extenders
(4)
|
Kosse, TX
|
|
1,053 owned
25 mineral lease |
|
10,830
|
|
|
—
|
|
|
10,830
|
|
|
40
|
%
|
|
—
|
|
|
Oil and gas proppants
(3)
, building products, recreational products
(4)
|
Berkeley Springs, WV
|
|
4,435 owned
|
|
1,223
|
|
|
6,000
|
|
|
7,223
|
|
|
72
|
%
|
|
504
|
|
|
Glass, building products, fillers and extenders
(4)
|
Columbia, SC
|
|
648 lease
204 owned |
|
4,208
|
|
|
—
|
|
|
4,208
|
|
|
72
|
%
|
|
534
|
|
|
Glass, building products, fillers and extenders
(4)
|
Dubberly, LA
|
|
356 owned
|
|
4,300
|
|
|
—
|
|
|
4,300
|
|
|
82
|
%
|
|
225
|
|
|
Glass, foundry, building products
(4)
|
Montpelier
(1)
,
VA
|
|
824 owned
|
|
—
|
|
|
12,774
|
|
|
12,774
|
|
|
39
|
%
|
|
191
|
|
|
Glass, building products
(4)
|
Hurtsboro, AL
|
|
117 owned
1,108 mineral lease |
|
322
|
|
|
—
|
|
|
322
|
|
|
83
|
%
|
|
156
|
|
|
Foundry, building products
(4)
|
Mauricetown, NJ
|
|
1,279 owned
|
|
11,554
|
|
|
—
|
|
|
11,554
|
|
|
55
|
%
|
|
260
|
|
|
Filtration, foundry, building products
(4)
|
Rockwood
(2)
, MI
|
|
872 owned
|
|
8,363
|
|
|
—
|
|
|
8,363
|
|
|
—
|
%
|
|
—
|
|
|
Glass, building products
(4)
|
Middleton, TN
|
|
1,178 owned
|
|
1,528
|
|
|
11,657
|
|
|
13,185
|
|
|
66
|
%
|
|
182
|
|
|
Absorbent for automotive, industrial
(4)
|
Clark, NV
|
|
1,730 owned 70 leased
|
|
2,338
|
|
|
973
|
|
|
3,311
|
|
|
78
|
%
|
|
72
|
|
|
Absorbents, catalysts, supports filtration
(4)
|
Fernley, NV
|
|
5,668 owned
|
|
1,616
|
|
|
—
|
|
|
1,616
|
|
|
60
|
%
|
|
55
|
|
|
Absorbent for automotive, industrial
(4)
|
Fowlkes Mine, MS
|
|
502 owned / 146 leased
|
|
—
|
|
|
1,222
|
|
|
1,222
|
|
|
100
|
%
|
|
74
|
|
|
Edible oil, petro chemical, animal feed
(4)
|
Hazen Mine, NV
|
|
120 owned 1135 leased
|
|
358
|
|
|
84
|
|
|
442
|
|
|
90
|
%
|
|
38
|
|
|
Calcium silicate insulation
(4)
|
Popcorn Mine, NV
|
|
200 owned
|
|
4,662
|
|
|
—
|
|
|
4,662
|
|
|
93
|
%
|
|
17
|
|
|
Filtration for wine, sugar, enzymes
(4)
|
Colado Mine, NV
|
|
3,067 owned 3,799 leased
|
|
1,066
|
|
|
3,273
|
|
|
4,339
|
|
|
83
|
%
|
|
279
|
|
|
Filtration for brewing, wine, swimming pools, sweeteners; additives for coatings, LDPE film
(4)
|
Celatom Mine, OR
|
|
4,998 owned 2,120 leased
|
|
—
|
|
|
25,381
|
|
|
25,381
|
|
|
90
|
%
|
|
102
|
|
|
Filtration for brewing, wine, swimming pools, sweeteners; additives for coatings
(4)
|
Cheto Mine, AZ
|
|
10,240 lease
|
|
—
|
|
|
579
|
|
|
579
|
|
|
100
|
%
|
|
1
|
|
|
Static desiccant
(4)
|
Fallon, NV
|
|
840 owned
|
|
—
|
|
|
935
|
|
|
935
|
|
|
70
|
%
|
|
1
|
|
|
Filtration for brewing, wine, swimming pools, sweeteners; additives for coatings, LDPE film
(4)
|
Total
|
|
|
|
485,186
|
|
|
197,451
|
|
|
682,637
|
|
|
|
|
24,032
|
|
|
|
(1)
|
Montpelier’s reserves are comprised entirely of the mineral aplite.
|
(2)
|
Rockwood's products were produced, or sourced, from a third party. It did not mine any of its reserves in 2018.
|
(3)
|
Oil & Gas Proppants segment
|
(4)
|
Industrial & Specialty Products segment
|
ITEM 3.
|
LEGAL PROCEEDINGS
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
|
Sales Price
|
||||||
|
High
|
|
Low
|
||||
Fiscal 2018
|
|
|
|
||||
First Quarter
|
$
|
38.70
|
|
|
$
|
24.15
|
|
Second Quarter
|
$
|
34.34
|
|
|
$
|
23.75
|
|
Third Quarter
|
$
|
27.91
|
|
|
$
|
17.92
|
|
Fourth Quarter
|
$
|
20.82
|
|
|
$
|
9.30
|
|
Fiscal 2017
|
|
|
|
||||
First Quarter
|
$
|
61.49
|
|
|
$
|
42.27
|
|
Second Quarter
|
$
|
50.39
|
|
|
$
|
31.79
|
|
Third Quarter
|
$
|
37.00
|
|
|
$
|
24.26
|
|
Fourth Quarter
|
$
|
36.55
|
|
|
$
|
27.42
|
|
Declaration date
|
Dividends per common share
|
||
February 16, 2017
|
$
|
0.0625
|
|
May 4, 2017
|
$
|
0.0625
|
|
July 21, 2017
|
$
|
0.0625
|
|
November 2, 2017
|
$
|
0.0625
|
|
February 16, 2018
|
$
|
0.0625
|
|
May 14, 2018
|
$
|
0.0625
|
|
July 16, 2018
|
$
|
0.0625
|
|
November 13, 2018
|
$
|
0.0625
|
|
Period
|
Total Number of
Shares Purchased |
|
Average Price
Paid Per Share |
|
Total Number of
Shares Purchased as Part of Publicly Announced Program (1) |
|
Maximum Dollar Value of
Shares that May Yet Be Purchased Under the Program (1) |
|||||
October 1, 2018 - October 31, 2018
|
1,000,000
|
|
|
$
|
13.70
|
|
|
1,000,000
|
|
|
170,800,060
|
|
November 1, 2018 - November 30, 2018
|
1,511,837
|
|
(2)
|
$
|
14.52
|
|
|
1,500,000
|
|
|
149,020,060
|
|
December 1, 2018 - December 31, 2018
|
2,000,336
|
|
(2)
|
$
|
11.24
|
|
|
2,000,000
|
|
|
126,540,060
|
|
Total
|
4,512,173
|
|
|
$
|
12.88
|
|
|
4,500,000
|
|
|
|
|
|
|
(1)
|
In May 2018, our Board of Directors authorized and announced the repurchase of up to $200 million of our common stock.
|
|
(2)
|
Includes 11,837 and 336 shares withheld by U.S. Silica to pay taxes due upon the vesting of employee restricted stock and restricted stock units for the months ended November 30, and December 31, 2018, respectively.
|
|
Number of securities
to be issued upon
exercise of
outstanding options,
warrants and rights (A)
|
|
Weighted-average
exercise price of
outstanding
options, warrants
and rights
(B)
|
|
Number of securities
remaining available
for future issuance
under equity
compensation plans
(excluding securities
reflected in column A)
(C)
|
||||
Equity compensation plans approved by security holders
|
901,996
|
|
|
$
|
28.52
|
|
|
3,447,363
|
|
Equity compensation plans not approved by security holders
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
901,996
|
|
|
28.52
|
|
|
3,447,363
|
|
ITEM 6.
|
SELECTED FINANCIAL DATA
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2018
(4)
|
|
2017
(5)
|
|
2016
(5)
|
|
2015
|
|
2014
(2)
|
||||||||||
|
(amounts in thousands, excluding per share and per ton figures)
|
||||||||||||||||||
Statement of Operations Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Sales
|
$
|
1,577,298
|
|
|
$
|
1,240,851
|
|
|
$
|
559,625
|
|
|
$
|
642,989
|
|
|
$
|
876,741
|
|
Operating income (loss)
|
(163,533
|
)
|
|
169,742
|
|
|
(52,491
|
)
|
|
26,672
|
|
|
176,167
|
|
|||||
Income (loss) before income taxes
|
(229,953
|
)
|
|
136,526
|
|
|
(77,745
|
)
|
|
117
|
|
|
158,723
|
|
|||||
Net income (loss) attributable to U.S. Silica Holdings, Inc.
|
(200,808
|
)
|
|
145,206
|
|
|
(41,056
|
)
|
|
11,868
|
|
|
121,540
|
|
|||||
Earnings (loss) per share - basic
|
$
|
(2.63
|
)
|
|
$
|
1.79
|
|
|
$
|
(0.63
|
)
|
|
$
|
0.22
|
|
|
$
|
2.26
|
|
Earnings (loss) per share - diluted
|
$
|
(2.63
|
)
|
|
$
|
1.77
|
|
|
$
|
(0.63
|
)
|
|
$
|
0.22
|
|
|
$
|
2.24
|
|
Cash dividends declared per common share
|
$
|
0.25
|
|
|
$
|
0.25
|
|
|
$
|
0.25
|
|
|
$
|
0.44
|
|
|
$
|
0.50
|
|
Statement of Cash Flows Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by (used in):
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating activities
|
$
|
310,706
|
|
|
$
|
222,013
|
|
|
$
|
381
|
|
|
$
|
61,492
|
|
|
$
|
171,411
|
|
Investing activities
|
(1,066,879
|
)
|
|
(491,529
|
)
|
|
(201,657
|
)
|
|
49
|
|
|
(190,906
|
)
|
|||||
Financing activities
|
$
|
574,104
|
|
|
$
|
(57,142
|
)
|
|
$
|
635,424
|
|
|
$
|
(47,530
|
)
|
|
$
|
208,964
|
|
Other Financial Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
$
|
339,815
|
|
|
$
|
368,479
|
|
|
$
|
46,450
|
|
|
$
|
53,646
|
|
|
$
|
92,609
|
|
Operating Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total tons sold
|
18,059
|
|
|
15,128
|
|
|
9,875
|
|
|
10,025
|
|
|
10,927
|
|
|||||
Average selling price (per ton)
|
$
|
87.34
|
|
|
$
|
82.02
|
|
|
$
|
56.67
|
|
|
$
|
64.14
|
|
|
$
|
80.24
|
|
Segment cost of goods sold (per ton)
(1)
|
58.94
|
|
|
56.19
|
|
|
47.51
|
|
|
48.27
|
|
|
51.20
|
|
|||||
Oil & Gas Proppants:
|
|
|
|
|
|
|
|
|
|
||||||||||
Sales
|
$
|
1,182,991
|
|
|
$
|
1,020,365
|
|
|
$
|
362,550
|
|
|
$
|
430,435
|
|
|
$
|
662,770
|
|
Segment contribution margin
(6)
|
357,846
|
|
|
301,972
|
|
|
11,445
|
|
|
88,928
|
|
|
256,137
|
|
|||||
Industrial & Specialty Products:
|
|
|
|
|
|
|
|
|
|
||||||||||
Sales
|
$
|
394,307
|
|
|
$
|
220,486
|
|
|
$
|
197,075
|
|
|
$
|
212,554
|
|
|
$
|
213,971
|
|
Segment contribution margin
(6)
|
155,084
|
|
|
88,781
|
|
|
78,988
|
|
|
70,137
|
|
|
61,102
|
|
|||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
(3)
|
$
|
202,498
|
|
|
$
|
384,567
|
|
|
$
|
711,225
|
|
|
$
|
298,926
|
|
|
$
|
338,209
|
|
Total assets
(3)
|
2,900,840
|
|
|
2,307,283
|
|
|
2,073,220
|
|
|
1,108,619
|
|
|
1,226,727
|
|
|||||
Total long-term debt, including current portion
|
1,270,400
|
|
|
489,075
|
|
|
494,175
|
|
|
491,705
|
|
|
495,086
|
|
|||||
Total liabilities
(3)
|
1,848,536
|
|
|
910,777
|
|
|
799,930
|
|
|
724,452
|
|
|
822,911
|
|
|||||
Total stockholders’ equity
|
$
|
1,052,304
|
|
|
$
|
1,396,506
|
|
|
$
|
1,273,290
|
|
|
$
|
384,167
|
|
|
$
|
403,816
|
|
(1)
|
Segment cost of goods sold (per ton) equals segment cost of goods sold, divided by total tons sold.
|
(2)
|
We acquired Cadre on July 31, 2014 and included Cadre's financial position and results of operations in our 2014 financial information above.
|
(3)
|
In 2015, we changed the presentation of book overdraft from being classified as a liability to a reduction to our cash and cash equivalents. 2014 cash and cash equivalents amount presented is recasted to reflect this change.
|
(4)
|
We acquired EP Minerals Holdings, Inc. on May 1, 2018, and have included their financial position and results of operations in our 2018 financial information above. As a result, our 2018 financial information may not be comparable to prior years. See
Note E - Business Combinations
to our Consolidated Financial Statements in Item 8. of this Annual Report on Form 10-K for more information.
|
(5)
|
We acquired White Armor and MS Sand on April 1, 2017 and August 16, 2017, respectively, and NBI and Sandbox on August 16, 2016 and August 22, 2016, respectively, and have included their financial position and results of operations in our 2017 and 2016 financial information above. As a result, our 2017 and 2016 financial information may not be comparable to prior years. See
Note E - Business Combinations
.
|
(6)
|
Segment contribution margin is a financial measure that is not included or defined under generally accepted accounting principles in the United States (“GAAP”). For a detailed description of segment contribution margin and a reconciliation to its most comparable GAAP measure, please see the discussion under “How We Evaluate Our Business” in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
Amounts in thousands, except per ton data
|
|
|
Percentage Change for the Three Months Ended
|
|||||||||||||||||||||
Oil & Gas Proppants
|
December 31,
2018 |
|
September 30, 2018
|
|
June 30, 2018
|
|
March 31, 2018
|
|
December 31, 2018 vs. September 30, 2018
|
|
September 30, 2018 vs. June 30, 2018
|
|
June 30, 2018 vs. March 31, 2018
|
|||||||||||
Sales
|
$
|
243,546
|
|
|
$
|
302,452
|
|
|
$
|
324,063
|
|
|
$
|
312,930
|
|
|
(19
|
)%
|
|
(7
|
)%
|
|
4
|
%
|
Tons Sold
|
3,704
|
|
|
3,821
|
|
|
3,465
|
|
|
3,252
|
|
|
(3
|
)%
|
|
10
|
%
|
|
7
|
%
|
||||
Average Selling Price per Ton
|
$
|
65.75
|
|
|
$
|
79.16
|
|
|
$
|
93.52
|
|
|
$
|
96.23
|
|
|
(17
|
)%
|
|
(15
|
)%
|
|
(3
|
)%
|
•
|
increasing our presence and product offering in specialty products end markets
|
•
|
optimizing our product mix and further developing value-added capabilities to maximize margins
|
•
|
effectively positioning our Oil & Gas Proppants facilities to optimally serve our customers
|
•
|
optimizing our supply chain network and leveraging our logistics capabilities to meet our customers’ needs
|
•
|
evaluating both Greenfield and Brownfield expansion opportunities and other acquisitions; and maintaining financial strength and flexibility.
|
(amounts in thousands)
|
Year ended December 31,
|
|||||||||
|
2018
|
|
2017
|
2016
|
||||||
Net income (loss) attributable to U.S. Silica Holdings, Inc.
|
$
|
(200,808
|
)
|
|
$
|
145,206
|
|
$
|
(41,056
|
)
|
Total interest expense, net of interest income
|
64,689
|
|
|
25,871
|
|
25,779
|
|
|||
Provision for taxes
|
(29,132
|
)
|
|
(8,680
|
)
|
(36,689
|
)
|
|||
Total depreciation, depletion and amortization expenses
|
148,832
|
|
|
97,233
|
|
68,134
|
|
|||
EBITDA
|
(16,419
|
)
|
|
259,630
|
|
16,168
|
|
|||
Non-cash incentive compensation
(1)
|
22,337
|
|
|
25,050
|
|
12,107
|
|
|||
Post-employment expenses (excluding service costs)
(2)
|
2,206
|
|
|
1,231
|
|
1,040
|
|
|||
Merger and acquisition related expenses
(3)
|
34,098
|
|
|
9,010
|
|
8,206
|
|
|||
Plant capacity expansion expenses
(4)
|
59,112
|
|
|
5,667
|
|
—
|
|
|||
Contract termination expenses
(5)
|
2,491
|
|
|
325
|
|
—
|
|
|||
Goodwill and other asset impairments
(6)
|
281,899
|
|
|
—
|
|
—
|
|
|||
Business optimization projects
(7)
|
1,980
|
|
|
—
|
|
—
|
|
|||
Other adjustments allowable under the Credit Agreement
(8)
|
4,819
|
|
|
6,790
|
|
2,033
|
|
|||
Adjusted EBITDA
|
$
|
392,523
|
|
|
$
|
307,703
|
|
$
|
39,554
|
|
|
|
|
(1)
|
Reflects equity-based, non-cash compensation expense.
|
|
(2)
|
Includes net pension cost and net post-retirement cost relating to pension and other post-retirement benefit obligations during the applicable period, but in each case excluding the service cost relating to benefits earned during such period. Non-service net periodic benefit costs are not considered reflective of our operating performance because these costs do not exclusively originate from employee services during the applicable period and may experience periodic fluctuations as a result of changes in non-operating factors, including changes in discount rates, changes in expected returns on benefit plan assets, and other demographic actuarial assumptions. See Note P - Pension and Post-Retirement Benefits to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K for more information.
|
|
(3)
|
Merger and acquisition related expenses include legal fees, consulting fees, bank fees, severance costs, certain purchase accounting items such as the amortization of inventory fair value step-up, information technology integration costs and similar charges. 2018 expenses were higher than 2017 expenses, mainly due to the amortization of inventory fair value step-up. While these costs are not operational in nature and are not expected to continue for any singular transaction on an ongoing basis, similar types of costs, expenses and charges have occurred in prior periods and may recur in the future as we continue to integrate prior acquisitions and pursue any future acquisitions.
|
|
(4)
|
Plant capacity expansion expenses include expenses that are not inventoriable or capitalizable as related to plant expansion projects greater than $5 million in capital expenditures or plant start up projects. While these expenses are not operational in nature and are not expected to continue for any singular project on an ongoing basis, similar types of expenses have occurred in prior periods and may recur in the future as we continue to pursue future plant capacity expansion.
|
|
(5)
|
Reflects contract termination expenses related to strategically exiting a service contract and losses related to sub-leases. While these expenses are not operational in nature and are not expected to continue for any singular event on an ongoing basis, similar types of expenses have occurred in prior periods and may recur in the future as we continue to strategically evaluate our contracts.
|
|
(6)
|
Reflects $164.2 million of goodwill impairments, $97.0 million of long-lived asset impairments and $4.5 million of intangible asset impairments for 2018 in our Oil & Gas Proppants reporting segment due to a declining shift in demand for Northern White sand caused by some of our customers shifting to local in-basin frac sands with lower logistics costs. It also reflects a $16.2 million asset impairment related to the closure of our resin coating facility and associated product portfolio during the second quarter of 2018. See Note I - Goodwill and Intangible Assets and Note H - Property, Plant and Mine Development for additional information.
|
|
(7)
|
Reflects costs incurred related to business optimization projects within our corporate center, which aim to measure and improve the efficiency, productivity and performance of our organization. While these costs are not operational in nature and are not expected to continue for any singular project on an ongoing basis, similar types of expenses may recur in the future.
|
|
(8)
|
Reflects miscellaneous adjustments permitted under the Credit Agreement. For 2018, includes storm damage costs, recruiting fees and relocation costs, and a net loss of $0.7 million on divestitures of assets, consisting of $5.2 million of contract termination costs and $1.3 million of divestiture related expenses such as legal fees and consulting fees, partially offset by a $5.8 million gain on sale of assets. For 2017, includes a contract restructuring cost of $6.3 million. For 2016, includes restructuring costs of $3.5 million and a gain on insurance settlement of $1.5 million. While these gains and costs are not operational in nature and are not expected to continue for any singular event on an ongoing basis, similar types of gains and expenses have occurred in prior periods and may recur in the future.
|
(All amounts in thousands)
|
|
December 31, 2018
|
||
|
|
|
||
Total debt
|
|
$
|
1,259,411
|
|
Capital leases
|
|
344
|
|
|
Total consolidated debt
|
|
$
|
1,259,755
|
|
|
|
|
||
Adjusted EBITDA-trailing twelve months
|
|
$
|
392,523
|
|
Pro forma Adjusted EBITDA including impact of acquisitions
(1)
|
|
18,117
|
|
|
Other adjustments for covenant calculation
(2)
|
|
254
|
|
|
Total Adjusted EBITDA-trailing twelve months for covenant calculation
|
|
$
|
410,894
|
|
|
|
|
||
Consolidated leverage ratio
(3)
|
|
3.07
|
|
|
|
|
(1)
|
Covenant calculation allows for the Adjusted EBITDA-trailing twelve months to include the impact of acquisitions on a pro forma basis.
|
|
(2)
|
Covenant calculation excludes activity at legal entities above the operating company, which is mainly interest income offset by public company operating expenses.
|
|
(3)
|
Calculated by dividing Total consolidated debt by Total Adjusted EBITDA-trailing twelve months for covenant calculation.
|
(In thousands except per ton data)
|
Year ended December 31,
|
|
Percent Change
|
|||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
'18 vs.'17
|
'17 vs. '16
|
||||||||
Sales:
|
|
|
|
|
|
|
|
|
||||||||
Oil & Gas Proppants
|
$
|
1,182,991
|
|
|
$
|
1,020,365
|
|
|
$
|
362,550
|
|
|
16
|
%
|
181
|
%
|
Industrial & Specialty Products
|
394,307
|
|
|
220,486
|
|
|
197,075
|
|
|
79
|
%
|
12
|
%
|
|||
Total sales
|
$
|
1,577,298
|
|
|
$
|
1,240,851
|
|
|
$
|
559,625
|
|
|
27
|
%
|
122
|
%
|
Tons:
|
|
|
|
|
|
|
|
|
||||||||
Oil & Gas Proppants
|
14,242
|
|
|
11,595
|
|
|
6,442
|
|
|
23
|
%
|
80
|
%
|
|||
Industrial & Specialty Products
|
3,817
|
|
|
3,533
|
|
|
3,433
|
|
|
8
|
%
|
3
|
%
|
|||
Total Tons
|
18,059
|
|
|
15,128
|
|
|
9,875
|
|
|
19
|
%
|
53
|
%
|
|||
Average Selling Price per Ton:
|
|
|
|
|
|
|
|
|
||||||||
Oil & Gas Proppants
|
$
|
83.06
|
|
|
$
|
88.00
|
|
|
$
|
56.28
|
|
|
(6
|
)%
|
56
|
%
|
Industrial & Specialty Products
|
103.30
|
|
|
62.41
|
|
|
57.41
|
|
|
66
|
%
|
9
|
%
|
|||
Overall Average Selling Price per Ton
|
$
|
87.34
|
|
|
$
|
82.02
|
|
|
$
|
56.67
|
|
|
6
|
%
|
45
|
%
|
•
|
Compensation related expense increased by
$22.7 million
for the year ended
December 31, 2018
compared to the year ended
December 31, 2017
, due to the acquisition of EPM, higher employee headcount, and increased equity-based compensation.
|
•
|
Merger and acquisition related expense increased by $9.5 million to $13.9 million for the year ended
December 31, 2018
compared to $4.4 million for the year ended
December 31, 2017
. The increase was mainly due to costs related to the acquisition of EPM.
|
•
|
Business optimization project expenses within our corporate center, which aim to measure and improve the efficiency, productivity and performance of our organization, were
$2.0 million
for the year ended
December 31, 2018
.
|
•
|
A net loss of $0.7 million on divestitures of assets, consisting of $5.2 million of contract termination costs and $1.3 million of divestiture related expenses such as legal fees and consulting fees, partially offset by a $5.8 million gain on sales of assets during the first quarter of 2018.
|
•
|
Compensation related expense increased by
$30.8 million
for the year ended December 31, 2017 compared to 2016, primarily due to increased equity-based compensation and higher employee headcount due to our acquisitions of NBI, Sandbox and MS Sand.
|
•
|
Bad debt expense increased by
$2.8 million
for the year ended December 31, 2017 compared to the year ended December 31, 2016, mainly due to increased sales.
|
•
|
Merger and acquisition related expense decreased by $1.2 million to $4.4 million for the year ended December 31, 2017 compared to $5.6 million for the year ended December 31, 2016. The decrease was due to lower MS Sand merger and acquisition expenses compared to the NBI and Sandbox acquisitions.
|
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Net cash provided by (used in):
|
|
|
|
|
|
||||||
Operating activities
|
$
|
310,706
|
|
|
$
|
222,013
|
|
|
$
|
381
|
|
Investing activities
|
(1,066,879
|
)
|
|
(491,529
|
)
|
|
(201,657
|
)
|
|||
Financing activities
|
574,104
|
|
|
(57,142
|
)
|
|
635,424
|
|
|
Total
|
|
Less than
1 year
|
|
1-3 years
|
|
3-5 years
|
|
More than
5 years
|
||||||||||
|
(amounts in thousands)
|
||||||||||||||||||
Principal payments on long-term debt
(1)
|
$
|
1,270,400
|
|
|
$
|
12,800
|
|
|
$
|
25,600
|
|
|
$
|
25,600
|
|
|
$
|
1,206,400
|
|
Estimated interest payments on long-term debt
(4)
|
517,326
|
|
|
83,842
|
|
|
164,384
|
|
|
158,704
|
|
|
110,396
|
|
|||||
Minimum payments on note payable secured by royalty interest
|
26,511
|
|
|
1,750
|
|
|
3,500
|
|
|
3,500
|
|
|
17,761
|
|
|||||
Retirement plans
|
110,874
|
|
|
11,531
|
|
|
21,560
|
|
|
22,062
|
|
|
55,721
|
|
|||||
Capital lease obligations
|
344
|
|
|
344
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating lease obligations
|
269,273
|
|
|
74,884
|
|
|
99,792
|
|
|
54,449
|
|
|
40,148
|
|
|||||
Minimum purchase obligations
(2)
|
63,595
|
|
|
23,243
|
|
|
23,713
|
|
|
10,555
|
|
|
6,084
|
|
|||||
Total Contractual Cash Obligations
(3)
:
|
$
|
2,258,323
|
|
|
$
|
208,394
|
|
|
$
|
338,549
|
|
|
$
|
274,870
|
|
|
$
|
1,436,510
|
|
(1)
|
Excludes the unamortized debt issuance costs and original issue discount.
|
(2)
|
Includes estimated future minimum purchase obligations related to transload service agreements and transportation service agreements. As of
December 31, 2018
, we accrued $1.6 million in shortfall fees under these service agreements.
|
(3)
|
The above table excludes discounted asset retirement obligations in the amount of
$18.4 million
at
December 31, 2018
, the majority of which have a settlement date beyond 2025, as well as indemnification for surety bonds issued on our behalf discussed in
Note S - Obligations Under Guarantees
to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.
|
(4)
|
Estimated interest payment amounts are computed using forecasted three-month LIBOR rates as of December 31, 2018.
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
ASSETS
|
|||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
202,498
|
|
|
$
|
384,567
|
|
Accounts receivable, net
|
215,486
|
|
|
212,586
|
|
||
Inventories, net
|
162,087
|
|
|
92,376
|
|
||
Prepaid expenses and other current assets
|
17,966
|
|
|
13,715
|
|
||
Income tax deposits
|
2,200
|
|
|
—
|
|
||
Total current assets
|
600,237
|
|
|
703,244
|
|
||
Property, plant and mine development, net
|
1,826,303
|
|
|
1,169,155
|
|
||
Goodwill
|
261,340
|
|
|
272,079
|
|
||
Intangible assets, net
|
194,626
|
|
|
150,007
|
|
||
Other assets
|
18,334
|
|
|
12,798
|
|
||
Total assets
|
$
|
2,900,840
|
|
|
$
|
2,307,283
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|||||||
Current Liabilities:
|
|
|
|
||||
Accounts payable and accrued expenses
|
$
|
216,400
|
|
|
$
|
171,041
|
|
Current portion of long-term debt
|
13,327
|
|
|
6,867
|
|
||
Current portion of deferred revenue
|
31,612
|
|
|
36,128
|
|
||
Income tax payable
|
—
|
|
|
1,566
|
|
||
Total current liabilities
|
261,339
|
|
|
215,602
|
|
||
Long-term debt, net
|
1,246,428
|
|
|
505,075
|
|
||
Deferred revenue
|
81,707
|
|
|
82,286
|
|
||
Liability for pension and other post-retirement benefits
|
57,194
|
|
|
52,867
|
|
||
Deferred income taxes, net
|
137,239
|
|
|
29,856
|
|
||
Other long-term obligations
|
64,629
|
|
|
25,091
|
|
||
Total liabilities
|
1,848,536
|
|
|
910,777
|
|
||
Commitments and Contingencies (Note Q)
|
|
|
|
|
|
||
Stockholders’ Equity:
|
|
|
|
||||
Preferred stock, $0.01 par value, 10,000,000 shares authorized; zero issued and outstanding at December 31, 2018 and 2017
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value, 500,000,000 shares authorized; 81,811,977 issued and 73,148,853 outstanding at December 31, 2018; 81,267,205 issued and 80,524,255 outstanding at December 31, 2017
|
818
|
|
|
812
|
|
||
Additional paid-in capital
|
1,169,383
|
|
|
1,147,084
|
|
||
Retained earnings
|
67,854
|
|
|
287,992
|
|
||
Treasury stock, at cost, 8,663,124 and 742,950 shares at December 31, 2018 and 2017, respectively
|
(178,215
|
)
|
|
(25,456
|
)
|
||
Accumulated other comprehensive loss
|
(15,020
|
)
|
|
(13,926
|
)
|
||
Total U.S. Silica Holdings, Inc. stockholders’ equity
|
1,044,820
|
|
|
1,396,506
|
|
||
Non-controlling interest
|
7,484
|
|
|
—
|
|
||
Total stockholders' equity
|
1,052,304
|
|
|
1,396,506
|
|
||
Total liabilities and stockholders’ equity
|
$
|
2,900,840
|
|
|
$
|
2,307,283
|
|
|
Year Ended
December 31, |
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Sales:
|
|
|
|
|
|
||||||
Product
|
$
|
1,282,799
|
|
|
$
|
1,010,394
|
|
|
$
|
524,137
|
|
Service
|
294,499
|
|
|
230,457
|
|
|
35,488
|
|
|||
Total sales
|
1,577,298
|
|
|
1,240,851
|
|
|
559,625
|
|
|||
Cost of sales (excluding depreciation, depletion and amortization):
|
|
|
|
|
|
||||||
Product
|
955,469
|
|
|
714,521
|
|
|
456,783
|
|
|||
Service
|
207,660
|
|
|
152,299
|
|
|
20,027
|
|
|||
Total cost of sales (excluding depreciation, depletion and amortization)
|
1,163,129
|
|
|
866,820
|
|
|
476,810
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Selling, general and administrative
|
146,971
|
|
|
107,056
|
|
|
67,172
|
|
|||
Depreciation, depletion and amortization
|
148,832
|
|
|
97,233
|
|
|
68,134
|
|
|||
Goodwill and other asset impairments
|
281,899
|
|
|
—
|
|
|
—
|
|
|||
Total operating expenses
|
577,702
|
|
|
204,289
|
|
|
135,306
|
|
|||
Operating income (loss)
|
(163,533
|
)
|
|
169,742
|
|
|
(52,491
|
)
|
|||
Other (expense) income:
|
|
|
|
|
|
||||||
Interest expense
|
(70,564
|
)
|
|
(31,342
|
)
|
|
(27,972
|
)
|
|||
Other income (expense), net, including interest income
|
4,144
|
|
|
(1,874
|
)
|
|
2,718
|
|
|||
Total other expense
|
(66,420
|
)
|
|
(33,216
|
)
|
|
(25,254
|
)
|
|||
Income (loss) before income taxes
|
(229,953
|
)
|
|
136,526
|
|
|
(77,745
|
)
|
|||
Income tax benefit
|
29,132
|
|
|
8,680
|
|
|
36,689
|
|
|||
Net income (loss)
|
$
|
(200,821
|
)
|
|
$
|
145,206
|
|
|
$
|
(41,056
|
)
|
Less: Net income (loss) attributable to non-controlling interest
|
(13
|
)
|
|
—
|
|
|
—
|
|
|||
Net income (loss) attributable to U.S. Silica Holdings, Inc.
|
$
|
(200,808
|
)
|
|
$
|
145,206
|
|
|
$
|
(41,056
|
)
|
Earnings (loss) per share attributable to U.S. Silica Holdings, Inc.:
|
|
|
|
|
|
||||||
Basic
|
$
|
(2.63
|
)
|
|
$
|
1.79
|
|
|
$
|
(0.63
|
)
|
Diluted
|
$
|
(2.63
|
)
|
|
$
|
1.77
|
|
|
$
|
(0.63
|
)
|
Weighted average shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
76,453
|
|
|
81,051
|
|
|
65,037
|
|
|||
Diluted
|
76,453
|
|
|
81,960
|
|
|
65,037
|
|
|||
Dividends declared per share
|
$
|
0.25
|
|
|
$
|
0.25
|
|
|
$
|
0.25
|
|
|
Year Ended
December 31, |
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Net income (loss)
|
$
|
(200,821
|
)
|
|
$
|
145,206
|
|
|
$
|
(41,056
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Unrealized gain (loss) on derivatives (net of tax of $(470) $(27) and $29 for 2018, 2017, and 2016, respectively)
|
(1,545
|
)
|
|
(44
|
)
|
|
49
|
|
|||
Foreign currency translation adjustment (net of tax of $(196) $2 and zero for 2018, 2017 and 2016, respectively)
|
(614
|
)
|
|
(6
|
)
|
|
—
|
|
|||
Unrealized gain (loss) on investments (net of tax of zero, zero, and $(4) for 2018, 2017 and 2016, respectively)
|
—
|
|
|
—
|
|
|
(6
|
)
|
|||
Pension and other post-retirement benefits liability adjustment (net of tax of $339, $1,205 and $152 for 2018, 2017 and 2016, respectively)
|
1,065
|
|
|
2,000
|
|
|
252
|
|
|||
Comprehensive income (loss)
|
$
|
(201,915
|
)
|
|
$
|
147,156
|
|
|
$
|
(40,761
|
)
|
Less: Comprehensive income (loss) attributable to non-controlling interest
|
(13
|
)
|
|
—
|
|
|
—
|
|
|||
Comprehensive income (loss) attributable to U.S. Silica Holdings, Inc.
|
$
|
(201,902
|
)
|
|
$
|
147,156
|
|
|
$
|
(40,761
|
)
|
|
Common
Stock |
Treasury
Stock |
Additional
Paid-In Capital |
Retained
Earnings |
Accumulated
Other Comprehensive Loss |
Total U.S. Silica Holdings Inc., Stockholders’
Equity |
Non-controlling Interest
|
Total
Stockholders’ Equity |
||||||||||||||||
Balance at January 1, 2016
|
$
|
539
|
|
$
|
(15,845
|
)
|
$
|
194,670
|
|
$
|
220,974
|
|
$
|
(16,171
|
)
|
$
|
384,167
|
|
$
|
—
|
|
$
|
384,167
|
|
Net loss
|
—
|
|
—
|
|
—
|
|
(41,056
|
)
|
—
|
|
(41,056
|
)
|
—
|
|
(41,056
|
)
|
||||||||
Issuance of common stock (stock offerings net of issuance costs of $25,732)
|
272
|
|
—
|
|
931,016
|
|
—
|
|
—
|
|
931,288
|
|
—
|
|
931,288
|
|
||||||||
Unrealized gain on derivatives
|
—
|
|
—
|
|
—
|
|
—
|
|
49
|
|
49
|
|
—
|
|
49
|
|
||||||||
Unrealized loss on short-term investments
|
—
|
|
—
|
|
—
|
|
—
|
|
(6
|
)
|
(6
|
)
|
—
|
|
(6
|
)
|
||||||||
Pension and post-retirement liability
|
—
|
|
—
|
|
—
|
|
—
|
|
252
|
|
252
|
|
—
|
|
252
|
|
||||||||
Cash dividend declared ($0.25 per share)
|
—
|
|
—
|
|
—
|
|
(16,893
|
)
|
—
|
|
(16,893
|
)
|
—
|
|
(16,893
|
)
|
||||||||
Common stock-based compensation plans activity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Equity-based compensation
|
—
|
|
—
|
|
12,107
|
|
—
|
|
—
|
|
12,107
|
|
—
|
|
12,107
|
|
||||||||
Excess tax benefit from equity-based compensation
|
—
|
|
—
|
|
—
|
|
148
|
|
—
|
|
148
|
|
—
|
|
148
|
|
||||||||
Proceeds from options exercised
|
—
|
|
8,465
|
|
(3,640
|
)
|
—
|
|
—
|
|
4,825
|
|
—
|
|
4,825
|
|
||||||||
Issuance of restricted stock
|
—
|
|
1,437
|
|
(1,437
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||
Shares withheld for tax payments related to vested restricted stock and stock units
|
—
|
|
2,074
|
|
(3,665
|
)
|
—
|
|
—
|
|
(1,591
|
)
|
—
|
|
(1,591
|
)
|
||||||||
Balance at December 31, 2016
|
811
|
|
(3,869
|
)
|
1,129,051
|
|
163,173
|
|
(15,876
|
)
|
1,273,290
|
|
—
|
|
1,273,290
|
|
||||||||
Net income
|
—
|
|
—
|
|
—
|
|
145,206
|
|
—
|
|
145,206
|
|
—
|
|
145,206
|
|
||||||||
Unrealized loss on derivatives
|
—
|
|
—
|
|
—
|
|
—
|
|
(44
|
)
|
(44
|
)
|
—
|
|
(44
|
)
|
||||||||
Foreign currency translation adjustment
|
—
|
|
—
|
|
—
|
|
—
|
|
(6
|
)
|
(6
|
)
|
—
|
|
(6
|
)
|
||||||||
Pension and post-retirement liability
|
—
|
|
—
|
|
—
|
|
—
|
|
2,000
|
|
2,000
|
|
—
|
|
2,000
|
|
||||||||
Cash dividend declared ($0.25 per share)
|
—
|
|
—
|
|
—
|
|
(20,387
|
)
|
—
|
|
(20,387
|
)
|
—
|
|
(20,387
|
)
|
||||||||
Common stock-based compensation plans activity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Equity-based compensation
|
—
|
|
—
|
|
25,050
|
|
—
|
|
—
|
|
25,050
|
|
—
|
|
25,050
|
|
||||||||
Proceeds from options exercised
|
—
|
|
1,190
|
|
(392
|
)
|
—
|
|
—
|
|
798
|
|
—
|
|
798
|
|
||||||||
Issuance of restricted stock
|
—
|
|
1,859
|
|
(1,859
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Shares withheld for tax payments related to vested restricted stock and stock units
|
1
|
|
386
|
|
(4,766
|
)
|
—
|
|
—
|
|
(4,379
|
)
|
—
|
|
(4,379
|
)
|
||||||||
Repurchase of common stock
|
—
|
|
(25,022
|
)
|
—
|
|
—
|
|
—
|
|
(25,022
|
)
|
—
|
|
(25,022
|
)
|
||||||||
Balance at December 31, 2017
|
812
|
|
(25,456
|
)
|
1,147,084
|
|
287,992
|
|
(13,926
|
)
|
1,396,506
|
|
—
|
|
1,396,506
|
|
||||||||
Net loss
|
—
|
|
—
|
|
—
|
|
(200,808
|
)
|
—
|
|
(200,808
|
)
|
(13
|
)
|
(200,821
|
)
|
||||||||
Unrealized loss on derivatives
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,545
|
)
|
(1,545
|
)
|
—
|
|
(1,545
|
)
|
||||||||
Foreign currency translation adjustment
|
—
|
|
—
|
|
—
|
|
—
|
|
(614
|
)
|
(614
|
)
|
—
|
|
(614
|
)
|
||||||||
Pension and post-retirement liability
|
—
|
|
—
|
|
—
|
|
—
|
|
1,065
|
|
1,065
|
|
—
|
|
1,065
|
|
||||||||
Cash dividend declared ($0.25 per share)
|
—
|
|
—
|
|
—
|
|
(19,330
|
)
|
—
|
|
(19,330
|
)
|
—
|
|
(19,330
|
)
|
||||||||
Contributions from non-controlling interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
7,497
|
|
7,497
|
|
||||||||
Common stock-based compensation plans activity:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Equity-based compensation
|
—
|
|
—
|
|
22,337
|
|
—
|
|
—
|
|
22,337
|
|
—
|
|
22,337
|
|
||||||||
Proceeds from options exercised
|
—
|
|
93
|
|
(32
|
)
|
—
|
|
—
|
|
61
|
|
—
|
|
61
|
|
||||||||
Shares withheld for tax payments related to vested restricted stock and stock units
|
6
|
|
(4,383
|
)
|
(6
|
)
|
—
|
|
—
|
|
(4,383
|
)
|
—
|
|
(4,383
|
)
|
||||||||
Repurchase of common stock
|
—
|
|
(148,469
|
)
|
—
|
|
—
|
|
—
|
|
(148,469
|
)
|
—
|
|
(148,469
|
)
|
||||||||
Balance at December 31, 2018
|
$
|
818
|
|
$
|
(178,215
|
)
|
$
|
1,169,383
|
|
$
|
67,854
|
|
$
|
(15,020
|
)
|
$
|
1,044,820
|
|
$
|
7,484
|
|
$
|
1,052,304
|
|
|
Year Ended
December 31, |
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Operating activities:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(200,821
|
)
|
|
$
|
145,206
|
|
|
$
|
(41,056
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation, depletion and amortization
|
148,832
|
|
|
97,233
|
|
|
68,134
|
|
|||
Goodwill and other asset impairments
|
281,899
|
|
|
—
|
|
|
—
|
|
|||
Debt issuance amortization
|
4,044
|
|
|
1,382
|
|
|
1,392
|
|
|||
Original issue discount amortization
|
832
|
|
|
372
|
|
|
378
|
|
|||
Deferred income taxes
|
(31,070
|
)
|
|
(20,601
|
)
|
|
(36,903
|
)
|
|||
Deferred revenue
|
(36,720
|
)
|
|
28,438
|
|
|
(9,026
|
)
|
|||
(Gain) loss on disposal of property, plant and equipment
|
(5,170
|
)
|
|
415
|
|
|
563
|
|
|||
Equity-based compensation
|
22,337
|
|
|
25,050
|
|
|
12,107
|
|
|||
Bad debt provision, net of recoveries
|
315
|
|
|
1,529
|
|
|
(1,232
|
)
|
|||
Other
|
(13,536
|
)
|
|
13,929
|
|
|
5,300
|
|
|||
Changes in operating assets and liabilities, net of effects of acquisitions:
|
|
|
|
|
|
||||||
Accounts receivable
|
56,815
|
|
|
(110,920
|
)
|
|
(12,996
|
)
|
|||
Inventories
|
13,085
|
|
|
(4,825
|
)
|
|
(10,211
|
)
|
|||
Prepaid expenses and other current assets
|
(2,678
|
)
|
|
8,787
|
|
|
(509
|
)
|
|||
Income taxes
|
(3,764
|
)
|
|
1,469
|
|
|
11,558
|
|
|||
Accounts payable and accrued expenses
|
26,907
|
|
|
43,654
|
|
|
13,232
|
|
|||
Short-term and long-term obligations-vendor incentives
|
52,806
|
|
|
—
|
|
|
—
|
|
|||
Liability for pension and other post-retirement benefits
|
4,608
|
|
|
(705
|
)
|
|
1,307
|
|
|||
Other noncurrent assets and liabilities
|
(8,015
|
)
|
|
(8,400
|
)
|
|
(1,657
|
)
|
|||
Net cash provided by operating activities
|
310,706
|
|
|
222,013
|
|
|
381
|
|
|||
Investing activities:
|
|
|
|
|
|
||||||
Capital expenditures
|
(339,815
|
)
|
|
(368,479
|
)
|
|
(46,450
|
)
|
|||
Capitalized intellectual property costs
|
(10,046
|
)
|
|
(3,586
|
)
|
|
(959
|
)
|
|||
Maturities of short-term investments
|
—
|
|
|
—
|
|
|
21,872
|
|
|||
Acquisition of businesses, net of cash acquired
|
(743,249
|
)
|
|
(119,801
|
)
|
|
(176,617
|
)
|
|||
Proceeds from sale of property, plant and equipment
|
26,231
|
|
|
337
|
|
|
497
|
|
|||
Net cash used in investing activities
|
(1,066,879
|
)
|
|
(491,529
|
)
|
|
(201,657
|
)
|
|||
Financing activities:
|
|
|
|
|
|
||||||
Issuance of common stock
|
—
|
|
|
—
|
|
|
678,791
|
|
|||
Common stock issuance costs
|
—
|
|
|
—
|
|
|
(25,732
|
)
|
|||
Dividends paid
|
(19,912
|
)
|
|
(20,377
|
)
|
|
(15,125
|
)
|
|||
Repurchase of common stock
|
(148,469
|
)
|
|
(25,022
|
)
|
|
—
|
|
|||
Proceeds from options exercised
|
61
|
|
|
798
|
|
|
4,825
|
|
|||
Tax payments related to shares withheld for vested restricted stock and stock units
|
(4,383
|
)
|
|
(4,379
|
)
|
|
(1,591
|
)
|
|||
Proceeds from long-term debt
|
1,280,000
|
|
|
—
|
|
|
—
|
|
|||
Payments on long-term debt
|
(501,425
|
)
|
|
(7,211
|
)
|
|
(5,202
|
)
|
|||
Financing fees paid
|
(38,701
|
)
|
|
—
|
|
|
—
|
|
|||
Contributions from non-controlling interest
|
7,497
|
|
|
—
|
|
|
—
|
|
|||
Principal payments on capital lease obligations
|
(564
|
)
|
|
(951
|
)
|
|
(542
|
)
|
|||
Net cash provided by (used in) financing activities
|
574,104
|
|
|
(57,142
|
)
|
|
635,424
|
|
|||
Net (decrease) increase in cash and cash equivalents
|
(182,069
|
)
|
|
(326,658
|
)
|
|
434,148
|
|
|||
Cash and cash equivalents, beginning of period
|
384,567
|
|
|
711,225
|
|
|
277,077
|
|
Cash and cash equivalents, end of period
|
$
|
202,498
|
|
|
$
|
384,567
|
|
|
$
|
711,225
|
|
Supplemental cash flow information:
|
|
|
|
|
|
||||||
Cash paid (received) during the period for:
|
|
|
|
|
|
||||||
Interest
|
$
|
66,769
|
|
|
$
|
24,490
|
|
|
$
|
21,994
|
|
Taxes, net of refunds
|
$
|
5,373
|
|
|
$
|
8,958
|
|
|
$
|
(11,322
|
)
|
Related party purchases
|
$
|
2,958
|
|
|
$
|
4,942
|
|
|
$
|
446
|
|
Non-cash Items:
|
|
|
|
|
|
||||||
Common stock issued in connection with acquisitions
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
278,229
|
|
Capital lease obligations incurred to acquire assets
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
165
|
|
Equipment received
|
$
|
—
|
|
|
$
|
18,185
|
|
|
$
|
—
|
|
Accrued capital expenditures
|
$
|
36,008
|
|
|
$
|
16,534
|
|
|
$
|
391
|
|
Capital lease assumed by third-party
|
$
|
119
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Asset retirement obligation assumed by third-party
|
$
|
2,116
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Year ended December 31, 2017
|
||||||||||||||
|
As Previously Reported
|
|
Services Reclassifications
|
|
ASU 2017-07 Adjustments
|
|
As Revised
|
||||||||
Product Sales
|
$
|
1,057,553
|
|
|
$
|
(47,159
|
)
|
|
$
|
—
|
|
|
$
|
1,010,394
|
|
Service Sales
|
183,298
|
|
|
47,159
|
|
|
—
|
|
|
230,457
|
|
||||
Total sales
|
1,240,851
|
|
|
—
|
|
|
—
|
|
|
1,240,851
|
|
||||
Product cost of sales
|
720,312
|
|
|
(5,096
|
)
|
|
(695
|
)
|
|
714,521
|
|
||||
Service cost of sales
|
147,203
|
|
|
5,096
|
|
|
—
|
|
|
152,299
|
|
||||
Total cost of sales (excluding depreciation, depletion and amortization)
|
867,515
|
|
|
—
|
|
|
(695
|
)
|
|
866,820
|
|
||||
Selling, general and administrative expenses
|
107,592
|
|
|
—
|
|
|
(536
|
)
|
|
107,056
|
|
||||
Operating income
|
168,511
|
|
|
—
|
|
|
1,231
|
|
|
169,742
|
|
||||
Other income (expense)
|
(643
|
)
|
|
—
|
|
|
(1,231
|
)
|
|
(1,874
|
)
|
|
Year ended December 31, 2016
|
||||||||||||||
|
As Previously Reported
|
|
Services Reclassifications
|
|
ASU 2017-07 Adjustments
|
|
As Revised
|
||||||||
Product Sales
|
$
|
523,900
|
|
|
$
|
237
|
|
|
$
|
—
|
|
|
$
|
524,137
|
|
Service Sales
|
35,725
|
|
|
(237
|
)
|
|
—
|
|
|
35,488
|
|
||||
Total sales
|
559,625
|
|
|
—
|
|
|
—
|
|
|
559,625
|
|
||||
Product cost of sales
|
455,189
|
|
|
2,079
|
|
|
(485
|
)
|
|
456,783
|
|
||||
Service cost of sales
|
22,106
|
|
|
(2,079
|
)
|
|
—
|
|
|
20,027
|
|
||||
Total cost of sales (excluding depreciation, depletion and amortization)
|
477,295
|
|
|
—
|
|
|
(485
|
)
|
|
476,810
|
|
||||
Selling, general and administrative expenses
|
67,727
|
|
|
—
|
|
|
(555
|
)
|
|
67,172
|
|
||||
Operating income
|
(53,531
|
)
|
|
—
|
|
|
1,040
|
|
|
(52,491
|
)
|
||||
Other income (expense)
|
3,758
|
|
|
—
|
|
|
(1,040
|
)
|
|
2,718
|
|
In thousands, except per share amounts
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Numerator:
|
|
|
|
|
|
|
||||||
Net income (loss) attributable to U.S. Silica Holdings, Inc.
|
|
$
|
(200,808
|
)
|
|
$
|
145,206
|
|
|
$
|
(41,056
|
)
|
|
|
|
|
|
|
|
||||||
Denominator:
|
|
|
|
|
|
|
||||||
Weighted average shares outstanding
|
|
76,453
|
|
|
81,051
|
|
|
65,037
|
|
|||
Diluted effect of stock awards
|
|
—
|
|
|
909
|
|
|
—
|
|
|||
Weighted average shares outstanding assuming dilution
|
|
76,453
|
|
|
81,960
|
|
|
65,037
|
|
|||
|
|
|
|
|
|
|
||||||
Earnings (loss) per share attributable to U.S. Silica Holdings, Inc.:
|
|
|
|
|
|
|
||||||
Basic earnings (loss) per share
|
|
$
|
(2.63
|
)
|
|
$
|
1.79
|
|
|
$
|
(0.63
|
)
|
Diluted earnings (loss) per share
|
|
$
|
(2.63
|
)
|
|
$
|
1.77
|
|
|
$
|
(0.63
|
)
|
|
|
Year ended December 31,
|
|||||||
|
|
2018
|
|
2017
|
|
2016
|
|||
Stock options excluded
|
|
574
|
|
|
195
|
|
|
573
|
|
Restricted stock and performance share units awards excluded
|
|
155
|
|
|
305
|
|
|
166
|
|
Dividends per Common Share
|
|
Declaration Date
|
|
Record Date
|
|
Payable Date
|
||
$
|
0.0625
|
|
|
February 16, 2018
|
|
March 15, 2018
|
|
April 5, 2018
|
$
|
0.0625
|
|
|
May 14, 2018
|
|
June 15, 2018
|
|
July 6, 2018
|
$
|
0.0625
|
|
|
July 16, 2018
|
|
September 14, 2018
|
|
October 3, 2018
|
$
|
0.0625
|
|
|
November 13, 2018
|
|
December 14, 2018
|
|
January 4, 2019
|
|
For the Year Ended December 31, 2018
|
||||||||||||||
|
Unrealized gain/(loss) on cash flow hedges
|
|
Foreign currency translation adjustments
|
|
Pension and other post-retirement benefits liability
|
|
Total
|
||||||||
Beginning Balance
|
$
|
(76
|
)
|
|
$
|
(6
|
)
|
|
$
|
(13,844
|
)
|
|
$
|
(13,926
|
)
|
Other comprehensive gain (loss) before reclassifications
|
(1,622
|
)
|
|
(614
|
)
|
|
(879
|
)
|
|
(3,115
|
)
|
||||
Amounts reclassed from accumulated other comprehensive loss
|
77
|
|
|
—
|
|
|
1,944
|
|
|
2,021
|
|
||||
Ending Balance
|
$
|
(1,621
|
)
|
|
$
|
(620
|
)
|
|
$
|
(12,779
|
)
|
|
$
|
(15,020
|
)
|
Preliminary allocation of purchase price:
|
Estimate as of May 1, 2018
|
Measurement Period Adjustments
|
Purchase Price Allocation
|
||||||
Accounts receivable, net
|
$
|
43,354
|
|
$
|
(49
|
)
|
$
|
43,305
|
|
Inventories
|
84,395
|
|
1,717
|
|
86,112
|
|
|||
Property, plant and mine development
|
123,086
|
|
25,409
|
|
148,495
|
|
|||
Mineral rights
|
462,050
|
|
(42,581
|
)
|
419,469
|
|
|||
Identifiable intangible assets - finite lived
|
21,050
|
|
(10,780
|
)
|
10,270
|
|
|||
Identifiable intangible assets - indefinite lived
|
25,050
|
|
13,000
|
|
38,050
|
|
|||
Prepaids and deposits
|
2,054
|
|
18
|
|
2,072
|
|
|||
Other assets
|
4,088
|
|
3,386
|
|
7,474
|
|
|||
Goodwill
|
139,787
|
|
10,841
|
|
150,628
|
|
|||
Total assets acquired
|
904,914
|
|
961
|
|
905,875
|
|
|||
Accounts payable
|
13,435
|
|
—
|
|
13,435
|
|
|||
Accrued expenses and other current liabilities
|
8,255
|
|
2,049
|
|
10,304
|
|
|||
Deferred tax liabilities
|
130,209
|
|
(7,398
|
)
|
122,811
|
|
|||
Long term obligations
|
9,766
|
|
6,310
|
|
16,076
|
|
|||
Total liabilities assumed
|
$
|
161,665
|
|
$
|
961
|
|
$
|
162,626
|
|
Net assets acquired
|
$
|
743,249
|
|
$
|
—
|
|
$
|
743,249
|
|
|
Approximate Fair Value
|
|
Estimated Useful Life
|
||
|
(in thousands)
|
|
(in years)
|
||
Technology and intellectual property
|
$
|
2,900
|
|
|
15
|
Customer relationships
|
7,370
|
|
|
15
|
|
Total identifiable intangible assets - finite lived
|
$
|
10,270
|
|
|
|
|
|
|
|
||
Trade names
|
$
|
38,050
|
|
|
|
Total identifiable intangible assets - indefinite lived
|
$
|
38,050
|
|
|
|
|
For the year ended December 31,
|
||||||
|
2018
|
|
2017
|
||||
Sales
|
$
|
1,659,775
|
|
|
$
|
1,454,070
|
|
Net income (loss)
|
$
|
(179,220
|
)
|
|
$
|
116,899
|
|
Basic earnings (loss) per share
|
$
|
(2.34
|
)
|
|
$
|
1.44
|
|
Diluted earnings (loss) per share
|
$
|
(2.34
|
)
|
|
$
|
1.43
|
|
|
|
|
|
|
Estimate as of December 31, 2017
|
Measurement Period Adjustments
|
Purchase Price Allocation
|
||||||
Accounts receivable
|
$
|
11,201
|
|
$
|
—
|
|
$
|
11,201
|
|
Inventories
|
8,067
|
|
—
|
|
8,067
|
|
|||
Other current assets
|
362
|
|
—
|
|
362
|
|
|||
Assets held for sale
|
9,453
|
|
—
|
|
9,453
|
|
|||
Property, plant and mine development
|
27,458
|
|
—
|
|
27,458
|
|
|||
Mineral rights
|
26,300
|
|
(2,800
|
)
|
23,500
|
|
|||
Other non-current assets
|
1,136
|
|
—
|
|
1,136
|
|
|||
Goodwill
|
22,522
|
|
2,800
|
|
25,322
|
|
|||
Customer relationships
|
1,840
|
|
—
|
|
1,840
|
|
|||
Total assets acquired
|
108,339
|
|
—
|
|
108,339
|
|
|||
Accounts payable and accrued expenses
|
3,761
|
|
—
|
|
3,761
|
|
|||
Unfavorable leasehold positions
|
2,237
|
|
—
|
|
2,237
|
|
|||
Notes Payable
|
866
|
|
—
|
|
866
|
|
|||
Other long term liabilities
|
—
|
|
—
|
|
—
|
|
|||
Asset retirement obligations
|
474
|
|
—
|
|
474
|
|
|||
Total liabilities assumed
|
7,338
|
|
—
|
|
7,338
|
|
|||
Net assets acquired
|
$
|
101,001
|
|
$
|
—
|
|
$
|
101,001
|
|
|
Approximate Fair Value
|
Estimated Useful Life
|
||
|
(in thousands)
|
(in years)
|
||
Customer relationships
|
$
|
1,840
|
|
15
|
|
For the year ended December 31,
|
||||||
|
2017
|
|
2016
|
||||
Sales
|
$
|
1,287,202
|
|
|
$
|
642,951
|
|
Net income (loss)
|
$
|
143,604
|
|
|
$
|
(55,835
|
)
|
Basic earnings (loss) per share
|
$
|
1.77
|
|
|
$
|
(0.86
|
)
|
Diluted earnings (loss) per share
|
$
|
1.75
|
|
|
$
|
(0.86
|
)
|
|
Initial Estimate
|
Measurement Period Adjustments
|
Purchase Price Allocation
|
||||||
Accounts receivable
|
$
|
2,680
|
|
$
|
—
|
|
$
|
2,680
|
|
Inventories
|
3,494
|
|
—
|
|
3,494
|
|
|||
Other current assets
|
428
|
|
—
|
|
428
|
|
|||
Income tax deposits
|
6,657
|
|
(217
|
)
|
6,440
|
|
|||
Property, plant and mine development
|
210,913
|
|
(4,281
|
)
|
206,632
|
|
|||
Identifiable intangible assets
|
1,600
|
|
—
|
|
1,600
|
|
|||
Goodwill
|
86,228
|
|
4,670
|
|
90,898
|
|
|||
Total assets acquired
|
312,000
|
|
172
|
|
312,172
|
|
|||
Accounts payable, accrued expenses and other current liabilities
|
1,938
|
|
726
|
|
2,664
|
|
|||
Deferred revenue
|
500
|
|
—
|
|
500
|
|
|||
Notes payable
|
24,361
|
|
243
|
|
24,604
|
|
|||
Capital lease liabilities
|
3,331
|
|
—
|
|
3,331
|
|
|||
Asset retirement obligations
|
710
|
|
—
|
|
710
|
|
|||
Deferred tax liabilities
|
67,435
|
|
(797
|
)
|
66,638
|
|
|||
Total liabilities assumed
|
98,275
|
|
172
|
|
98,447
|
|
|||
Net assets acquired
|
$
|
213,725
|
|
$
|
—
|
|
$
|
213,725
|
|
|
Approximate Fair Value
|
Estimated Useful Life
|
||
|
(in thousands)
|
(in years)
|
||
Customer relationships
|
$
|
1,600
|
|
13
|
Allocation of Purchase price:
|
(in thousands)
|
||
Accounts receivable
|
$
|
13,392
|
|
Prepaid expenses and other
|
1,465
|
|
|
Property, plant and mine development
|
32,336
|
|
|
Identifiable intangible assets
|
120,144
|
|
|
Goodwill
|
86,100
|
|
|
Total assets acquired
|
253,437
|
|
|
Accounts payable
|
4,122
|
|
|
Deferred revenue
|
4,902
|
|
|
Accrued expenses and other current liabilities
|
3,292
|
|
|
Total liabilities assumed
|
12,316
|
|
|
Net assets acquired
|
$
|
241,121
|
|
|
Approximate Fair Value
|
Estimated Useful Life
|
||
|
(in thousands)
|
(in years)
|
||
Indefinite lived intangible assets - Trade names
|
$
|
17,844
|
|
Indefinite
|
Definite lived intangible assets - Technology and intellectual property
|
57,700
|
|
15
|
|
Definite lived intangible asset - Customer relationships
|
44,600
|
|
13
|
|
Total fair value of identifiable intangible assets
|
$
|
120,144
|
|
|
|
For the year ended December 31,
|
||
|
2016
|
||
Sales
|
$
|
615,552
|
|
Net income (loss)
|
$
|
(45,161
|
)
|
Basic earnings (loss) per share
|
$
|
(0.69
|
)
|
Diluted earnings (loss) per share
|
$
|
(0.69
|
)
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
Trade receivables
|
$
|
198,435
|
|
|
$
|
217,649
|
|
Less: Allowance for doubtful accounts
|
(6,751
|
)
|
|
(7,100
|
)
|
||
Net trade receivables
|
191,684
|
|
|
210,549
|
|
||
Other receivables
(1)
|
23,802
|
|
|
2,037
|
|
||
Total accounts receivable
|
$
|
215,486
|
|
|
$
|
212,586
|
|
(1
|
)
|
At December 31, 2018, other receivables include $16.0 million of refundable alternative minimum tax credits.
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
Beginning balance
|
$
|
7,100
|
|
|
$
|
7,042
|
|
Bad debt provision
|
315
|
|
|
1,529
|
|
||
Write-offs
|
(664
|
)
|
|
(1,471
|
)
|
||
Ending balance
|
$
|
6,751
|
|
|
$
|
7,100
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Supplies
|
$
|
41,453
|
|
|
$
|
21,277
|
|
Raw materials and work in process
|
68,474
|
|
|
28,034
|
|
||
Finished goods
|
52,160
|
|
|
43,065
|
|
||
Total inventories
|
$
|
162,087
|
|
|
$
|
92,376
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
Mining property and mine development
|
$
|
995,759
|
|
|
$
|
586,242
|
|
Asset retirement cost
|
12,732
|
|
|
14,184
|
|
||
Land
|
55,502
|
|
|
36,552
|
|
||
Land improvements
|
67,729
|
|
|
45,878
|
|
||
Buildings
|
64,515
|
|
|
56,330
|
|
||
Machinery and equipment
|
958,357
|
|
|
590,566
|
|
||
Furniture and fixtures
|
3,599
|
|
|
2,953
|
|
||
Construction-in-progress
|
167,933
|
|
|
189,970
|
|
||
|
2,326,126
|
|
|
1,522,675
|
|
||
Accumulated depletion, depreciation and amortization
|
(499,823
|
)
|
|
(353,520
|
)
|
||
Total property, plant and mine development, net
|
$
|
1,826,303
|
|
|
$
|
1,169,155
|
|
|
Oil & Gas Proppants Segment
|
|
Industrial & Specialty Products Segment
|
|
Total
|
||||||
|
|
|
|
|
|
||||||
Goodwill
|
$
|
47,947
|
|
|
$
|
20,700
|
|
|
$
|
68,647
|
|
Impairment losses
|
—
|
|
|
—
|
|
|
—
|
|
|||
Balance at January 1, 2016
|
$
|
47,947
|
|
|
$
|
20,700
|
|
|
$
|
68,647
|
|
|
|
|
|
|
|
||||||
NBI acquisition
|
86,228
|
|
|
—
|
|
|
86,228
|
|
|||
Sandbox acquisition
|
86,100
|
|
|
—
|
|
|
86,100
|
|
|||
|
|
|
|
|
|
||||||
Goodwill
|
220,275
|
|
|
20,700
|
|
|
240,975
|
|
|||
Impairment losses
|
—
|
|
|
—
|
|
|
—
|
|
|||
Balance at December 31, 2016
|
220,275
|
|
|
20,700
|
|
|
240,975
|
|
|||
|
|
|
|
|
|
||||||
White Armor acquisition
|
—
|
|
|
3,912
|
|
|
3,912
|
|
|||
NBI acquisition measurement period adjustment
|
4,670
|
|
|
—
|
|
|
4,670
|
|
|||
MS Sand acquisition
|
52,187
|
|
|
—
|
|
|
52,187
|
|
|||
MS Sand acquisition measurement period adjustment
|
(29,665
|
)
|
|
—
|
|
|
(29,665
|
)
|
|||
|
|
|
|
|
|
||||||
Goodwill
|
247,467
|
|
|
24,612
|
|
|
272,079
|
|
|||
Impairment losses
|
—
|
|
|
—
|
|
|
—
|
|
|||
Balance at December 31, 2017
|
247,467
|
|
|
24,612
|
|
|
272,079
|
|
|||
|
|
|
|
|
|
||||||
MS Sand acquisition measurement period adjustment
|
2,800
|
|
|
—
|
|
|
2,800
|
|
|||
EPMH acquisition
|
—
|
|
|
139,787
|
|
|
139,787
|
|
|||
EPMH acquisition measurement period adjustment
|
—
|
|
|
10,841
|
|
|
10,841
|
|
|||
Oil & Gas Sand impairment
|
(164,167
|
)
|
|
—
|
|
|
(164,167
|
)
|
|||
|
|
|
|
|
|
||||||
Goodwill
|
250,267
|
|
|
175,240
|
|
|
425,507
|
|
|||
Impairment losses
|
(164,167
|
)
|
|
—
|
|
|
(164,167
|
)
|
|||
Balance at December 31, 2018
|
$
|
86,100
|
|
|
$
|
175,240
|
|
|
$
|
261,340
|
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
Estimated Useful Life
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net
|
||||||||||||
|
(in years)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Technology and intellectual property
|
15
|
|
$
|
83,616
|
|
|
$
|
(11,168
|
)
|
|
$
|
72,448
|
|
|
$
|
70,703
|
|
|
$
|
(5,917
|
)
|
|
$
|
64,786
|
|
Customer relationships
|
13 - 15
|
|
68,379
|
|
|
(13,541
|
)
|
|
54,838
|
|
|
61,229
|
|
|
(9,076
|
)
|
|
52,153
|
|
||||||
Total definite-lived intangible assets:
|
|
|
$
|
151,995
|
|
|
$
|
(24,709
|
)
|
|
$
|
127,286
|
|
|
$
|
131,932
|
|
|
$
|
(14,993
|
)
|
|
$
|
116,939
|
|
Trade names
|
|
|
66,640
|
|
|
—
|
|
|
66,640
|
|
|
33,068
|
|
|
—
|
|
|
33,068
|
|
||||||
Other
|
|
|
700
|
|
|
—
|
|
|
700
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total intangible assets:
|
|
|
$
|
219,335
|
|
|
$
|
(24,709
|
)
|
|
$
|
194,626
|
|
|
$
|
165,000
|
|
|
$
|
(14,993
|
)
|
|
$
|
150,007
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Trade payables
|
$
|
178,804
|
|
|
$
|
148,772
|
|
Accrued salaries and wages
|
12,291
|
|
|
6,126
|
|
||
Accrued vacation liability
|
3,503
|
|
|
2,906
|
|
||
Current portion of liability for pension and post-retirement benefits
|
2,708
|
|
|
1,524
|
|
||
Accrued healthcare liability
|
2,702
|
|
|
1,837
|
|
||
Accrued property taxes and sales taxes
|
4,490
|
|
|
2,720
|
|
||
Other accrued liabilities
|
11,902
|
|
|
7,156
|
|
||
Accounts payable and accrued liabilities
|
$
|
216,400
|
|
|
$
|
171,041
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
Senior secured credit facility:
|
|
|
|
||||
Revolver expiring May 1, 2023 (8.50% at December 31, 2018 and 5.75% at December 31, 2017)
|
$
|
—
|
|
|
$
|
—
|
|
Term Loan facility—final maturity May 1, 2025 (6.56% at December 31, 2018 and 4.75%-5.25% December 31, 2017)
|
1,270,400
|
|
|
489,075
|
|
||
Less: Unamortized original issue discount
|
(6,511
|
)
|
|
(944
|
)
|
||
Less: Unamortized debt issuance cost
|
(31,310
|
)
|
|
(3,099
|
)
|
||
Note payable secured by royalty interest
|
26,511
|
|
|
24,740
|
|
||
Customer note payable
|
—
|
|
|
745
|
|
||
Equipment notes payable
|
321
|
|
|
719
|
|
||
Capital leases
|
344
|
|
|
706
|
|
||
Total debt
|
1,259,755
|
|
|
511,942
|
|
||
Less: current portion
|
(13,327
|
)
|
|
(6,867
|
)
|
||
Total long-term portion of debt
|
$
|
1,246,428
|
|
|
$
|
505,075
|
|
2019
|
$
|
12,800
|
|
2020
|
12,800
|
|
|
2021
|
12,800
|
|
|
2022
|
12,800
|
|
|
2023
|
12,800
|
|
|
Thereafter
|
1,206,400
|
|
|
Total
|
$
|
1,270,400
|
|
2019
|
$
|
1,750
|
|
2020
|
1,750
|
|
|
2021
|
1,750
|
|
|
2022
|
1,750
|
|
|
2023
|
1,750
|
|
|
December 31,
2018 |
|
December 31, 2017
|
||||
Beginning balance
|
$
|
19,032
|
|
|
$
|
11,159
|
|
Accretion
|
1,214
|
|
|
879
|
|
||
Additions and revisions of prior estimates
|
(319
|
)
|
|
6,994
|
|
||
Addition related to EPMH acquisition
|
2,733
|
|
|
—
|
|
||
EPMH measurement period adjustment
|
(2,131
|
)
|
|
—
|
|
||
Disposal related to sale of transloads
|
(2,116
|
)
|
|
—
|
|
||
Ending balance
|
$
|
18,413
|
|
|
$
|
19,032
|
|
|
December 31, 2018
|
|
|
December 31, 2017
|
|||||||||||||||||||||||||
|
Maturity
Date |
|
Contract/Notional
Amount |
|
Carrying
Amount |
|
Fair
Value |
|
|
Maturity Date
|
|
Contract/Notional
Amount |
|
Carrying
Amount |
|
Fair
Value |
|||||||||||||
LIBOR
(1)
interest rate swap agreement
|
2020
|
|
|
$440
|
million
|
|
$
|
(1,475
|
)
|
|
$
|
(1,475
|
)
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
LIBOR
(1)
interest rate swap agreement
|
2020
|
|
|
$200
|
million
|
|
$
|
(663
|
)
|
|
$
|
(663
|
)
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
LIBOR
interest rate cap agreement
|
2019
|
|
|
$249
|
million
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
2019
|
|
|
|
$249
|
million
|
|
$
|
—
|
|
|
$
|
—
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
Deferred losses from derivatives in OCI, beginning of period
|
$
|
(76
|
)
|
|
$
|
(32
|
)
|
|
$
|
(81
|
)
|
Gain (loss) recognized in OCI from derivative instruments
|
(1,622
|
)
|
|
(45
|
)
|
|
(32
|
)
|
|||
Loss reclassified from Accumulated OCI
|
77
|
|
|
1
|
|
|
81
|
|
|||
Deferred losses from derivatives in OCI, end of period
|
$
|
(1,621
|
)
|
|
$
|
(76
|
)
|
|
$
|
(32
|
)
|
|
Number of
Shares |
|
Weighted
Average Exercise Price |
|
Aggregate Intrinsic Value
|
|
Weighted
Average Remaining Contractual Term in Years |
|||||
Outstanding at December 31, 2017
|
908,919
|
|
|
$
|
28.46
|
|
|
$
|
7,008
|
|
|
6.1 years
|
Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
|
||
Exercised
|
(4,167
|
)
|
|
14.65
|
|
|
—
|
|
|
|
||
Forfeited
|
(918
|
)
|
|
31.30
|
|
|
—
|
|
|
|
||
Expired
|
(1,838
|
)
|
|
$
|
31.30
|
|
|
$
|
—
|
|
|
|
Outstanding at December 31, 2018
|
901,996
|
|
|
$
|
28.52
|
|
|
$
|
18,566
|
|
|
4.8 years
|
Exercisable at December 31, 2018
|
901,996
|
|
|
$
|
28.52
|
|
|
$
|
18,566
|
|
|
4.8 years
|
|
Number of Shares
|
|
Grant Date Weighted
Average Fair Value
|
|||
Unvested, December 31, 2017
|
461,346
|
|
|
$
|
30.76
|
|
Granted
|
415,110
|
|
|
21.57
|
|
|
Vested
|
(256,012
|
)
|
|
28.66
|
|
|
Forfeited
|
(32,867
|
)
|
|
30.82
|
|
|
Unvested, December 31, 2018
|
587,577
|
|
|
$
|
25.18
|
|
|
Number of Shares
|
|
Grant Date Weighted
Average Fair Value |
|||
Unvested, December 31, 2017
|
881,416
|
|
|
$
|
42.16
|
|
Granted
|
261,500
|
|
|
31.24
|
|
|
Vested
|
(225,000
|
)
|
|
41.99
|
|
|
Forfeited
|
(79,728
|
)
|
|
40.45
|
|
|
Unvested, December 31, 2018
|
838,188
|
|
|
$
|
39.44
|
|
Year ending December 31,
|
Operating Lease Minimum Rental Payments
|
|
Minimum Purchase Commitments
|
||||
2019
|
$
|
74,884
|
|
|
$
|
23,243
|
|
2020
|
59,490
|
|
|
15,406
|
|
||
2021
|
40,302
|
|
|
8,307
|
|
||
2022
|
31,853
|
|
|
5,640
|
|
||
2023
|
22,596
|
|
|
4,915
|
|
||
Thereafter
|
40,148
|
|
|
6,084
|
|
||
Total future lease and purchase commitments
|
$
|
269,273
|
|
|
$
|
63,595
|
|
|
|
Year Ended
December 31, |
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Service cost
|
|
$
|
1,307
|
|
|
$
|
1,037
|
|
|
$
|
1,078
|
|
Interest cost
|
|
4,632
|
|
|
3,971
|
|
|
4,067
|
|
|||
Expected return on plan assets
|
|
(5,969
|
)
|
|
(5,265
|
)
|
|
(5,495
|
)
|
|||
Net amortization and deferral
|
|
2,526
|
|
|
1,773
|
|
|
1,592
|
|
|||
Net pension benefit costs
|
|
$
|
2,496
|
|
|
$
|
1,516
|
|
|
$
|
1,242
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Service cost
|
|
$
|
102
|
|
|
$
|
107
|
|
|
$
|
132
|
|
Interest cost
|
|
740
|
|
|
753
|
|
|
876
|
|
|||
Expected return on plan assets
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|||
Special termination benefit
|
|
—
|
|
|
—
|
|
|
21
|
|
|||
Net post-retirement benefit costs
|
|
$
|
842
|
|
|
$
|
859
|
|
|
$
|
1,028
|
|
|
Pension Benefits
|
|
Post-retirement Benefits
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Benefit obligation at January 1,
|
$
|
122,052
|
|
|
$
|
116,145
|
|
|
$
|
22,771
|
|
|
$
|
24,393
|
|
Service cost
|
1,307
|
|
|
1,037
|
|
|
102
|
|
|
107
|
|
||||
Interest cost
|
4,632
|
|
|
3,971
|
|
|
740
|
|
|
753
|
|
||||
Actuarial (gain) loss
|
(10,263
|
)
|
|
6,824
|
|
|
(965
|
)
|
|
(1,576
|
)
|
||||
Benefits paid
|
(8,202
|
)
|
|
(6,685
|
)
|
|
(1,499
|
)
|
|
(1,280
|
)
|
||||
Amendments
|
—
|
|
|
760
|
|
|
—
|
|
|
—
|
|
||||
Other
(1)
|
29,374
|
|
|
—
|
|
|
421
|
|
|
374
|
|
||||
Benefit obligation at December 31,
|
$
|
138,900
|
|
|
$
|
122,052
|
|
|
$
|
21,570
|
|
|
$
|
22,771
|
|
Fair value of plan assets at January 1,
|
$
|
92,067
|
|
|
$
|
83,850
|
|
|
$
|
—
|
|
|
$
|
14
|
|
Actual return on plan assets
|
(6,204
|
)
|
|
12,757
|
|
|
—
|
|
|
(1
|
)
|
||||
Employer contributions
|
3,350
|
|
|
2,145
|
|
|
1,078
|
|
|
893
|
|
||||
Benefits paid
|
(8,202
|
)
|
|
(6,685
|
)
|
|
(1,499
|
)
|
|
(1,280
|
)
|
||||
Other
(1)
|
21,385
|
|
|
—
|
|
|
421
|
|
|
374
|
|
||||
Fair value of plan assets at December 31,
|
$
|
102,396
|
|
|
$
|
92,067
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Plan assets less than benefit obligations at December 31 recognized as liability for pension and other post-retirement benefits
|
$
|
(36,504
|
)
|
|
$
|
(29,985
|
)
|
|
$
|
(21,570
|
)
|
|
$
|
(22,771
|
)
|
(1
|
)
|
Includes opening pension benefit obligation and plan assets balances related to the May 1, 2018, EPMH acquisition.
|
|
Benefits
|
||||||||||
|
|
|
Post-retirement
|
||||||||
|
Pension
|
|
Before
Medicare Subsidy |
|
After
Medicare Subsidy |
||||||
2019
|
$
|
10,022
|
|
|
$
|
1,553
|
|
|
$
|
1,394
|
|
2020
|
9,166
|
|
|
1,592
|
|
|
1,433
|
|
|||
2021
|
9,236
|
|
|
1,653
|
|
|
1,496
|
|
|||
2022
|
9,394
|
|
|
1,691
|
|
|
1,535
|
|
|||
2023
|
9,380
|
|
|
1,686
|
|
|
1,528
|
|
|||
2024-2028
|
47,737
|
|
|
8,262
|
|
|
7,442
|
|
|
Benefits
|
||||||||||
|
Pension
|
|
Post-retirement
|
|
Total
|
||||||
Net actuarial loss
|
$
|
1,034
|
|
|
$
|
—
|
|
|
$
|
1,034
|
|
Prior service cost
|
534
|
|
|
—
|
|
|
534
|
|
|||
|
$
|
1,568
|
|
|
$
|
—
|
|
|
$
|
1,568
|
|
|
Pension Benefits
|
|
Post-retirement Benefits
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Discount rate
|
4.4
|
%
|
|
3.7
|
%
|
|
4.3
|
%
|
|
3.7
|
%
|
Long-term rate of compensation increase
|
3.0%-3.5%
|
|
|
3.5
|
%
|
|
N/A
|
|
|
N/A
|
|
Long-term rate of return on plan assets
|
6.25%-7.15%
|
|
|
6.8
|
%
|
|
N/A
|
|
|
7.0
|
%
|
Health care cost trend rate:
|
|
|
|
|
|
|
|
||||
Pre-65 initial rate/ultimate rate
|
N/A
|
|
|
N/A
|
|
|
7.3%/4.5%
|
|
|
7.3%/4.5%
|
|
Pre-65 ultimate year
|
N/A
|
|
|
N/A
|
|
|
—
|
|
|
—
|
|
Post-65 initial rate/ultimate rate
|
N/A
|
|
|
N/A
|
|
|
8.0%/4.5%
|
|
|
8.0%/4.5%
|
|
Post-65 ultimate year
|
N/A
|
|
|
N/A
|
|
|
2026/2027
|
|
|
2025/2026
|
|
|
Pension and Post-retirement Benefits
|
||
|
2018
|
|
2017
|
Healthy Lives
|
RP-2014 mortality table, adjusted back to 2006 base rates, with generational mortality improvements using Scale MP-2018
|
|
RP-2014 mortality table, adjusted back to 2006 base rates, with generational mortality improvements using Scale MP-2017
|
Disabled Lives
|
RP-2014 disabled retiree mortality table, adjusted back to 2006 base rates, with generational mortality improvements using Scale MP-2018
|
|
RP-2014 disabled retiree mortality table, adjusted back to 2006 base rates, with generational mortality improvements using Scale MP-2017
|
|
One-Percentage-Point
|
||||||
|
Increase
|
|
Decrease
|
||||
Effect on total of service and interest cost
|
$
|
109
|
|
|
$
|
(92
|
)
|
Effect on post-retirement benefit obligation
|
2,291
|
|
|
(1,967
|
)
|
|
Pension Benefits
|
|
Post-retirement Benefits
(1)
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Equity securities
|
42.1
|
%
|
|
51.8
|
%
|
|
—
|
%
|
|
—
|
%
|
Debt securities
|
55.5
|
%
|
|
46.3
|
%
|
|
—
|
%
|
|
—
|
%
|
Cash
|
2.4
|
%
|
|
1.9
|
%
|
|
—
|
%
|
|
—
|
%
|
(1
|
)
|
Retiree health benefits are paid by the Company as covered expenses are incurred.
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
2,449
|
|
|
$
|
—
|
|
|
$
|
2,449
|
|
Mutual funds:
|
|
|
|
|
|
|
|
||||||||
Diversified emerging markets
|
6,638
|
|
|
—
|
|
|
—
|
|
|
6,638
|
|
||||
Foreign large blend
|
11,689
|
|
|
—
|
|
|
—
|
|
|
11,689
|
|
||||
Large-cap blend
|
14,226
|
|
|
—
|
|
|
—
|
|
|
14,226
|
|
||||
Mid-cap blend
|
6,819
|
|
|
—
|
|
|
—
|
|
|
6,819
|
|
||||
Small-cap blend
|
522
|
|
|
—
|
|
|
—
|
|
|
522
|
|
||||
Real estate
|
3,192
|
|
|
—
|
|
|
—
|
|
|
3,192
|
|
||||
Fixed income securities:
|
|
|
|
|
|
|
|
||||||||
Corporate notes and bonds
|
43,745
|
|
|
—
|
|
|
—
|
|
|
43,745
|
|
||||
U.S. Treasuries
|
8,486
|
|
|
—
|
|
|
—
|
|
|
8,486
|
|
||||
Mortgage-backed securities
|
—
|
|
|
3,578
|
|
|
—
|
|
|
3,578
|
|
||||
Asset-backed securities
|
—
|
|
|
1,052
|
|
|
—
|
|
|
1,052
|
|
||||
Net asset
|
$
|
95,317
|
|
|
$
|
7,079
|
|
|
$
|
—
|
|
|
$
|
102,396
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
1,727
|
|
|
$
|
—
|
|
|
$
|
1,727
|
|
Mutual funds:
|
|
|
|
|
|
|
|
||||||||
Diversified emerging markets
|
8,300
|
|
|
—
|
|
|
—
|
|
|
8,300
|
|
||||
Foreign large blend
|
11,856
|
|
|
—
|
|
|
—
|
|
|
11,856
|
|
||||
Large-cap blend
|
15,643
|
|
|
—
|
|
|
—
|
|
|
15,643
|
|
||||
Mid-cap blend
|
8,334
|
|
|
—
|
|
|
—
|
|
|
8,334
|
|
||||
Real estate
|
3,591
|
|
|
—
|
|
|
—
|
|
|
3,591
|
|
||||
Fixed income securities:
|
|
|
|
|
|
|
|
||||||||
Corporate notes and bonds
|
28,108
|
|
|
—
|
|
|
—
|
|
|
28,108
|
|
||||
U.S. Treasuries
|
10,846
|
|
|
—
|
|
|
—
|
|
|
10,846
|
|
||||
Mortgage-backed securities
|
—
|
|
|
2,615
|
|
|
—
|
|
|
2,615
|
|
||||
Asset-backed securities
|
—
|
|
|
1,047
|
|
|
—
|
|
|
1,047
|
|
||||
Net asset
|
$
|
86,678
|
|
|
$
|
5,389
|
|
|
$
|
—
|
|
|
$
|
92,067
|
|
(1)
|
The Pension Protection Act of 2006 defines the zone status as follows: green—healthy, yellow—endangered, orange—seriously endangered and red—critical.
|
(2)
|
In 2011, we withdrew from the Central States, Southeast and Southwest Areas Pension Plan. The withdrawal liability of
$1.0 million
will be paid in monthly installments of
$4,000
until 2031.
|
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
1,076
|
|
|
$
|
(10,754
|
)
|
|
$
|
60
|
|
State
|
(2,496
|
)
|
|
(1,167
|
)
|
|
(274
|
)
|
|||
Foreign
|
(518
|
)
|
|
—
|
|
|
—
|
|
|||
|
(1,938
|
)
|
|
(11,921
|
)
|
|
(214
|
)
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
25,578
|
|
|
22,641
|
|
|
32,944
|
|
|||
State
|
5,492
|
|
|
(2,040
|
)
|
|
3,959
|
|
|||
Foreign
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
31,070
|
|
|
20,601
|
|
|
36,903
|
|
|||
Income tax benefit
|
$
|
29,132
|
|
|
$
|
8,680
|
|
|
$
|
36,689
|
|
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Income tax (expense) benefit computed at U.S. federal statutory rate
|
$
|
48,290
|
|
|
$
|
(47,784
|
)
|
|
$
|
27,211
|
|
Decrease (increase) resulting from:
|
|
|
|
|
|
||||||
Statutory depletion
|
12,090
|
|
|
20,259
|
|
|
4,734
|
|
|||
Goodwill impairment
|
(29,157
|
)
|
|
—
|
|
|
—
|
|
|||
Prior year tax return reconciliation
|
530
|
|
|
219
|
|
|
435
|
|
|||
State income taxes, net of federal benefit
|
2,592
|
|
|
(2,267
|
)
|
|
2,369
|
|
|||
Adjustment to deferred taxes from the Tax Act rate reduction
|
—
|
|
|
35,772
|
|
|
—
|
|
|||
Equity compensation
|
(653
|
)
|
|
2,602
|
|
|
2,003
|
|
|||
Other, net
|
(4,560
|
)
|
|
(121
|
)
|
|
(63
|
)
|
|||
Income tax benefit
|
$
|
29,132
|
|
|
$
|
8,680
|
|
|
$
|
36,689
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Gross deferred tax assets:
|
|
|
|
||||
Net operating loss carry forward and state tax credits
|
$
|
11,089
|
|
|
$
|
22,783
|
|
Pension and post-retirement benefit costs
|
13,303
|
|
|
13,710
|
|
||
Alternative minimum tax credit carry forward
|
15,971
|
|
|
30,401
|
|
||
Property, plant and equipment
|
5,474
|
|
|
5,750
|
|
||
Accrued expenses
|
27,025
|
|
|
10,755
|
|
||
Inventories
|
774
|
|
|
4,354
|
|
||
Third-party products liability
|
231
|
|
|
249
|
|
||
Stock-based compensation expense
|
8,199
|
|
|
8,785
|
|
||
Note payable
|
3,724
|
|
|
3,133
|
|
||
Other
|
8,116
|
|
|
5,095
|
|
||
Total deferred tax assets
|
93,906
|
|
|
105,015
|
|
||
Gross deferred tax liabilities:
|
|
|
|
||||
Land and mineral property basis difference
|
(165,002
|
)
|
|
(78,520
|
)
|
||
Fixed assets and depreciation
|
(55,596
|
)
|
|
(51,556
|
)
|
||
Intangibles
|
(10,346
|
)
|
|
(4,795
|
)
|
||
Other
|
(201
|
)
|
|
—
|
|
||
Total deferred tax liabilities
|
(231,145
|
)
|
|
(134,871
|
)
|
||
Net deferred tax liabilities
|
$
|
(137,239
|
)
|
|
$
|
(29,856
|
)
|
|
|
Year Ended
December 31, 2018 |
||||||||||
Category
|
|
Oil & Gas Proppants
|
|
Industrial & Specialty Products
|
|
Total Sales
|
||||||
Product
|
|
$
|
888,509
|
|
|
$
|
394,290
|
|
|
$
|
1,282,799
|
|
Service
|
|
294,482
|
|
|
17
|
|
|
294,499
|
|
|||
Total Sales
|
|
$
|
1,182,991
|
|
|
$
|
394,307
|
|
|
$
|
1,577,298
|
|
|
|
Unbilled Receivables
|
||
December 31, 2017
|
|
$
|
5,245
|
|
Reclassifications to billed receivables
|
|
(11,157
|
)
|
|
Revenues recognized in excess of period billings
|
|
6,002
|
|
|
December 31, 2018
|
|
$
|
90
|
|
|
|
Deferred Revenue
|
||
December 31, 2017
|
|
$
|
118,414
|
|
Revenues recognized from balances held at the beginning of the period
|
|
(33,381
|
)
|
|
Revenues deferred from period collections on unfulfilled performance obligations
|
|
31,625
|
|
|
Revenues recognized from period collections
|
|
(3,339
|
)
|
|
December 31, 2018
|
|
$
|
113,319
|
|
|
|
Year Ended
December 31, |
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Sales:
|
|
|
|
|
|
|
||||||
Oil & Gas Proppants
|
|
$
|
1,182,991
|
|
|
$
|
1,020,365
|
|
|
$
|
362,550
|
|
Industrial & Specialty Products
|
|
394,307
|
|
|
220,486
|
|
|
197,075
|
|
|||
Total sales
|
|
1,577,298
|
|
|
1,240,851
|
|
|
559,625
|
|
|||
Segment contribution margin:
|
|
|
|
|
|
|
||||||
Oil & Gas Proppants
|
|
357,846
|
|
|
301,972
|
|
|
11,445
|
|
|||
Industrial & Specialty Products
|
|
155,084
|
|
|
88,781
|
|
|
78,988
|
|
|||
Total segment contribution margin
|
|
512,930
|
|
|
390,753
|
|
|
90,433
|
|
|||
Operating activities excluded from segment cost of sales
(1)
|
|
(98,761
|
)
|
|
(16,722
|
)
|
|
(7,618
|
)
|
|||
Selling, general and administrative
|
|
(146,971
|
)
|
|
(107,056
|
)
|
|
(67,172
|
)
|
|||
Depreciation, depletion and amortization
|
|
(148,832
|
)
|
|
(97,233
|
)
|
|
(68,134
|
)
|
|||
Goodwill and other asset impairments
|
|
(281,899
|
)
|
|
—
|
|
|
—
|
|
|||
Interest expense
|
|
(70,564
|
)
|
|
(31,342
|
)
|
|
(27,972
|
)
|
|||
Other income (expense), net, including interest income
|
|
4,144
|
|
|
(1,874
|
)
|
|
2,718
|
|
|||
Income tax benefit (expense)
|
|
29,132
|
|
|
8,680
|
|
|
36,689
|
|
|||
Net income (loss)
|
|
$
|
(200,821
|
)
|
|
$
|
145,206
|
|
|
$
|
(41,056
|
)
|
Less: Net income (loss) attributable to non-controlling interest
|
|
(13
|
)
|
|
—
|
|
|
—
|
|
|||
Net income (loss) attributable to U.S. Silica Holdings, Inc.
|
|
$
|
(200,808
|
)
|
|
$
|
145,206
|
|
|
$
|
(41,056
|
)
|
(1)
|
2018 increase driven by plant capacity expansion expenses and amortization of purchase accounting inventory fair value step-up.
|
|
First
Quarter |
Second
Quarter |
Third
Quarter |
Fourth
Quarter |
||||||||
2018
|
(Unaudited)
|
|||||||||||
Sales:
|
|
|
|
|
||||||||
Product
|
$
|
294,788
|
|
$
|
345,957
|
|
$
|
348,635
|
|
$
|
293,419
|
|
Service
|
74,525
|
|
81,476
|
|
74,537
|
|
63,961
|
|
||||
Cost of sales (excluding depreciation, depletion and amortization):
|
|
|
|
|
||||||||
Product
|
207,239
|
|
236,236
|
|
270,370
|
|
241,624
|
|
||||
Service
|
53,671
|
|
56,609
|
|
51,966
|
|
45,414
|
|
||||
Operating expenses:
|
|
|
|
|
||||||||
Selling, general and administrative
|
34,591
|
|
42,232
|
|
37,980
|
|
32,168
|
|
||||
Depreciation, depletion and amortization
|
28,592
|
|
36,563
|
|
37,150
|
|
46,527
|
|
Goodwill and other asset impairments
|
—
|
|
16,184
|
|
—
|
|
265,715
|
|
||||
Total operating expenses
|
63,183
|
|
94,979
|
|
75,130
|
|
344,410
|
|
||||
Operating income (loss)
|
45,220
|
|
39,609
|
|
25,706
|
|
(274,068
|
)
|
||||
Other (expense) income:
|
|
|
|
|
||||||||
Interest expense
|
(7,070
|
)
|
(20,214
|
)
|
(21,999
|
)
|
(21,281
|
)
|
||||
Other income (expense), net, including interest income
|
665
|
|
1,081
|
|
1,062
|
|
1,336
|
|
||||
Total other expense
|
(6,405
|
)
|
(19,133
|
)
|
(20,937
|
)
|
(19,945
|
)
|
||||
Income (loss) before income taxes
|
38,815
|
|
20,476
|
|
4,769
|
|
(294,013
|
)
|
||||
Income tax benefit
|
(7,521
|
)
|
(2,832
|
)
|
1,547
|
|
37,938
|
|
||||
Net income (loss)
|
31,294
|
|
17,644
|
|
6,316
|
|
(256,075
|
)
|
||||
Less: Net income (loss) attributable to non-controlling interest
|
—
|
|
—
|
|
—
|
|
(13
|
)
|
||||
Net income (loss) attributable to U.S. Silica Holdings, Inc.
|
$
|
31,294
|
|
$
|
17,644
|
|
$
|
6,316
|
|
$
|
(256,062
|
)
|
|
|
|
|
|
||||||||
Earnings (loss) per share, basic
|
$
|
0.39
|
|
$
|
0.23
|
|
$
|
0.08
|
|
$
|
(3.44
|
)
|
Earnings (loss) per share, diluted
|
$
|
0.39
|
|
$
|
0.22
|
|
$
|
0.08
|
|
$
|
(3.44
|
)
|
Weighted average shares outstanding, basic
|
79,496
|
|
77,784
|
|
77,365
|
|
74,485
|
|
||||
Weighted average shares outstanding, diluted
|
80,309
|
|
78,480
|
|
77,859
|
|
74,485
|
|
||||
Dividends declared per share
|
$
|
0.06
|
|
$
|
0.06
|
|
$
|
0.06
|
|
$
|
0.06
|
|
|
|
|
|
|
||||||||
|
First
Quarter |
Second
Quarter |
Third
Quarter |
Fourth
Quarter |
||||||||
2017
|
(Unaudited)
|
|||||||||||
Sales:
|
|
|
|
|
||||||||
Product
|
$
|
203,251
|
|
$
|
235,891
|
|
$
|
281,138
|
|
$
|
290,114
|
|
Service
|
41,546
|
|
54,574
|
|
63,885
|
|
70,452
|
|
||||
Cost of sales (excluding depreciation, depletion and amortization):
|
|
|
|
|
||||||||
Product
|
162,183
|
|
162,238
|
|
187,634
|
|
202,466
|
|
||||
Service
|
25,292
|
|
34,726
|
|
40,155
|
|
52,126
|
|
||||
Operating expenses:
|
|
|
|
|
||||||||
Selling, general and administrative
|
22,341
|
|
25,839
|
|
29,542
|
|
29,334
|
|
||||
Depreciation, depletion and amortization
|
21,599
|
|
23,626
|
|
24,673
|
|
27,335
|
|
||||
Total operating expenses
|
43,940
|
|
49,465
|
|
54,215
|
|
56,669
|
|
||||
Operating income (loss)
|
13,382
|
|
44,036
|
|
63,019
|
|
49,305
|
|
||||
Other (expense) income:
|
|
|
|
|
||||||||
Interest expense
|
(7,646
|
)
|
(8,105
|
)
|
(8,347
|
)
|
(7,244
|
)
|
||||
Other income (expense), net, including interest income
|
(4,928
|
)
|
638
|
|
1,308
|
|
1,108
|
|
||||
Total other expense
|
(12,574
|
)
|
(7,467
|
)
|
(7,039
|
)
|
(6,136
|
)
|
||||
Income (loss) before income taxes
|
808
|
|
36,569
|
|
55,980
|
|
43,169
|
|
||||
Income tax benefit
|
1,714
|
|
(7,110
|
)
|
(14,707
|
)
|
28,783
|
|
||||
Net income (loss)
|
2,522
|
|
29,459
|
|
41,273
|
|
71,952
|
|
||||
Less: Net income (loss) attributable to non-controlling interest
|
—
|
|
—
|
|
—
|
|
—
|
|
||||
Net income (loss) attributable to U.S. Silica Holdings, Inc.
|
$
|
2,522
|
|
$
|
29,459
|
|
$
|
41,273
|
|
$
|
71,952
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share, basic
|
$
|
0.03
|
|
$
|
0.36
|
|
$
|
0.51
|
|
$
|
0.95
|
|
Earnings (loss) per share, diluted
|
$
|
0.03
|
|
$
|
0.36
|
|
$
|
0.50
|
|
$
|
0.95
|
|
Weighted average shares, basic
|
80,983
|
|
81,087
|
|
81,121
|
|
75,539
|
|
||||
Weighted average shares, diluted
|
82,244
|
|
81,945
|
|
81,783
|
|
75,539
|
|
Dividends declared per share
|
$
|
0.06
|
|
$
|
0.06
|
|
$
|
0.06
|
|
$
|
0.06
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(in thousands)
|
||||||
ASSETS
|
|||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
107,151
|
|
|
$
|
230,647
|
|
Due from affiliates
|
100,094
|
|
|
146,683
|
|
||
Total current assets
|
207,245
|
|
|
377,330
|
|
||
Investment in subsidiaries
|
850,099
|
|
|
1,024,511
|
|
||
Total assets
|
$
|
1,057,344
|
|
|
$
|
1,401,841
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|||||||
Current Liabilities:
|
|
|
|
||||
Accrued expenses and other current liabilities
|
$
|
217
|
|
|
$
|
106
|
|
Dividends payable
|
4,823
|
|
|
5,229
|
|
||
Total current liabilities
|
5,040
|
|
|
5,335
|
|
||
Deferred income taxes, net
|
—
|
|
|
—
|
|
||
Total liabilities
|
5,040
|
|
|
5,335
|
|
||
Stockholders’ Equity:
|
|
|
|
||||
Preferred stock
|
—
|
|
|
—
|
|
||
Common stock
|
818
|
|
|
812
|
|
||
Additional paid-in capital
|
1,169,383
|
|
|
1,147,084
|
|
||
Retained earnings
|
67,854
|
|
|
287,992
|
|
||
Treasury stock, at cost
|
(178,215
|
)
|
|
(25,456
|
)
|
||
Accumulated other comprehensive loss
|
(15,020
|
)
|
|
(13,926
|
)
|
||
Total U.S. Silica Holdings, Inc. stockholders’ equity
|
1,044,820
|
|
|
1,396,506
|
|
||
Non-controlling interest
|
7,484
|
|
|
—
|
|
||
Total stockholders' equity
|
1,052,304
|
|
|
1,396,506
|
|
||
Total liabilities and stockholders’ equity
|
$
|
1,057,344
|
|
|
$
|
1,401,841
|
|
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(in thousands, except per share amounts)
|
||||||||||
Sales
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Cost of sales
|
—
|
|
|
—
|
|
|
—
|
|
|||
Operating expenses
|
|
|
|
|
|
||||||
Selling, general and administrative
|
254
|
|
|
252
|
|
|
184
|
|
|||
Other
|
—
|
|
|
—
|
|
|
10
|
|
|||
Total operating expenses
|
254
|
|
|
252
|
|
|
194
|
|
|||
Operating loss
|
(254
|
)
|
|
(252
|
)
|
|
(194
|
)
|
|||
Other income (expense)
|
|
|
|
|
|
||||||
Interest income
|
2,784
|
|
|
3,854
|
|
|
1,046
|
|
|||
Other income, net, including interest income
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total other income (expense)
|
2,784
|
|
|
3,854
|
|
|
1,046
|
|
|||
Income before income taxes and equity in net earnings of subsidiaries
|
2,530
|
|
|
3,602
|
|
|
852
|
|
|||
Income tax benefit (expense)
|
(696
|
)
|
|
(1,453
|
)
|
|
(344
|
)
|
|||
Income before equity in net earnings of subsidiaries
|
1,834
|
|
|
2,149
|
|
|
508
|
|
|||
Equity in earnings of subsidiaries, net of tax
|
(202,655
|
)
|
|
143,057
|
|
|
(41,564
|
)
|
|||
Net income (loss)
|
(200,821
|
)
|
|
145,206
|
|
|
(41,056
|
)
|
|||
Less: Net income (loss) attributable to non-controlling interest
|
(13
|
)
|
|
—
|
|
|
—
|
|
|||
Net income (loss) attributable to U.S. Silica Holdings, Inc.
|
(200,808
|
)
|
|
145,206
|
|
|
(41,056
|
)
|
|||
|
|
|
|
|
|
||||||
Net income (loss)
|
(200,821
|
)
|
|
145,206
|
|
|
(41,056
|
)
|
|||
Other comprehensive income (loss)
|
|
|
|
|
|
||||||
Unrealized gain (loss) on investments (net of tax of z
er
o, zero, and $(4) for 2018, 2017 and 2016, respectively)
|
—
|
|
|
—
|
|
|
(6
|
)
|
|||
Unrealized gain (loss) on derivatives (net of tax of $(470) $(27) and $29 for 2018, 2017, and 2016, respectively)
|
(1,545
|
)
|
|
(44
|
)
|
|
49
|
|
|||
Foreign currency translation adjustment (net of tax of $
(19
6) $2 and zero for 2018, 2017 and 2016, respectively)
|
(614
|
)
|
|
(6
|
)
|
|
—
|
|
|||
Pension and other post-retirement benefits liability a
djus
tment (net of tax of $339, $1,205 and $152 for 2018, 2017 and 2016, respectively)
|
1,065
|
|
|
2,000
|
|
|
252
|
|
|||
Comprehensive income (loss)
|
(201,915
|
)
|
|
147,156
|
|
|
(40,761
|
)
|
|||
Less: Comprehensive income (loss) attributable to non-controlling interest
|
$
|
(13
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Comprehensive income (loss) attributable to U.S. Silica Holdings, Inc.
|
$
|
(201,902
|
)
|
|
$
|
147,156
|
|
|
$
|
(40,761
|
)
|
|
Par Value
|
|
Treasury Stock
|
|
Additional Paid-In Capital
|
|
Retained Earnings - Present
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total U.S. Silica, Inc., Stockholders' Equity
|
Non-controlling Interest
|
Total
Stockholders’ Equity |
||||||||||||||||
Balance at January 1, 2016
|
$
|
539
|
|
|
$
|
(15,845
|
)
|
|
$
|
194,670
|
|
|
$
|
220,974
|
|
|
$
|
(16,171
|
)
|
|
$
|
384,167
|
|
$
|
—
|
|
$
|
384,167
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(41,056
|
)
|
|
—
|
|
|
(41,056
|
)
|
—
|
|
(41,056
|
)
|
||||||||
Issuance of common stock (stock offerings net of issuance costs of $25,732)
|
272
|
|
|
—
|
|
|
931,016
|
|
|
—
|
|
|
—
|
|
|
931,288
|
|
—
|
|
931,288
|
|
||||||||
Unrealized gain on derivatives
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
49
|
|
|
49
|
|
—
|
|
49
|
|
||||||||
Unrealized loss on short-term investments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
(6
|
)
|
—
|
|
(6
|
)
|
||||||||
Pension and post-retirement liability
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
252
|
|
|
252
|
|
—
|
|
252
|
|
||||||||
Cash dividend declared ($0.25 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,893
|
)
|
|
—
|
|
|
(16,893
|
)
|
—
|
|
(16,893
|
)
|
||||||||
Common stock-based compensation plans activity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Equity-based compensation
|
—
|
|
|
—
|
|
|
12,107
|
|
|
—
|
|
|
—
|
|
|
12,107
|
|
—
|
|
12,107
|
|
||||||||
Excess tax benefit from equity-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
148
|
|
|
—
|
|
|
148
|
|
—
|
|
148
|
|
||||||||
Proceeds from options exercised
|
—
|
|
|
8,465
|
|
|
(3,640
|
)
|
|
—
|
|
|
—
|
|
|
4,825
|
|
—
|
|
4,825
|
|
||||||||
Issuance of restricted stock
|
—
|
|
|
1,437
|
|
|
(1,437
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
||||||||
Shares withheld for employee taxes related to vested restricted stock and stock units
|
—
|
|
|
2,074
|
|
|
(3,665
|
)
|
|
—
|
|
|
—
|
|
|
(1,591
|
)
|
—
|
|
(1,591
|
)
|
||||||||
Balance at December 31, 2016
|
$
|
811
|
|
|
$
|
(3,869
|
)
|
|
$
|
1,129,051
|
|
|
$
|
163,173
|
|
|
$
|
(15,876
|
)
|
|
$
|
1,273,290
|
|
$
|
—
|
|
$
|
1,273,290
|
|
Net Income
|
—
|
|
|
—
|
|
|
—
|
|
|
145,206
|
|
|
—
|
|
|
145,206
|
|
—
|
|
145,206
|
|
||||||||
Unrealized loss on derivatives
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(44
|
)
|
|
(44
|
)
|
—
|
|
(44
|
)
|
||||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
(6
|
)
|
—
|
|
(6
|
)
|
||||||||
Pension and post-retirement liability
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,000
|
|
|
2,000
|
|
—
|
|
2,000
|
|
||||||||
Cash dividend declared ($0.25 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,387
|
)
|
|
—
|
|
|
(20,387
|
)
|
—
|
|
(20,387
|
)
|
||||||||
Common stock-based compensation plans activity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Equity-based compensation
|
—
|
|
|
—
|
|
|
25,050
|
|
|
—
|
|
|
—
|
|
|
25,050
|
|
—
|
|
25,050
|
|
||||||||
Proceeds from options exercised
|
—
|
|
|
1,190
|
|
|
(392
|
)
|
|
—
|
|
|
—
|
|
|
798
|
|
—
|
|
798
|
|
||||||||
Issuance of restricted stock
|
—
|
|
|
1,859
|
|
|
(1,859
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
||||||||
Shares withheld for employee taxes related to vested restricted stock and stock units
|
1
|
|
|
386
|
|
|
(4,766
|
)
|
|
—
|
|
|
—
|
|
|
(4,379
|
)
|
—
|
|
(4,379
|
)
|
||||||||
Repurchase of common stock
|
—
|
|
|
(25,022
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,022
|
)
|
—
|
|
(25,022
|
)
|
||||||||
Balance at December 31, 2017
|
$
|
812
|
|
|
$
|
(25,456
|
)
|
|
$
|
1,147,084
|
|
|
$
|
287,992
|
|
|
$
|
(13,926
|
)
|
|
$
|
1,396,506
|
|
$
|
—
|
|
$
|
1,396,506
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(200,808
|
)
|
|
—
|
|
|
(200,808
|
)
|
(13
|
)
|
(200,821
|
)
|
||||||||
Unrealized loss on derivatives
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,545
|
)
|
|
(1,545
|
)
|
—
|
|
(1,545
|
)
|
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(614
|
)
|
|
(614
|
)
|
—
|
|
(614
|
)
|
||||||||
Pension and post-retirement liability
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,065
|
|
|
1,065
|
|
—
|
|
1,065
|
|
||||||||
Cash dividend declared ($0.25 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,330
|
)
|
|
—
|
|
|
(19,330
|
)
|
—
|
|
(19,330
|
)
|
||||||||
Contributions from non-controlling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
7,497
|
|
7,497
|
|
||||||||
Common stock-based compensation plans activity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Equity-based compensation
|
—
|
|
|
—
|
|
|
22,337
|
|
|
—
|
|
|
—
|
|
|
22,337
|
|
—
|
|
22,337
|
|
||||||||
Proceeds from options exercised
|
—
|
|
|
93
|
|
|
(32
|
)
|
|
—
|
|
|
—
|
|
|
61
|
|
—
|
|
61
|
|
||||||||
Shares withheld for employee taxes related to vested restricted stock and stock units
|
6
|
|
|
(4,383
|
)
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
(4,383
|
)
|
—
|
|
(4,383
|
)
|
||||||||
Repurchase of common stock
|
—
|
|
|
(148,469
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(148,469
|
)
|
—
|
|
(148,469
|
)
|
||||||||
Balance at December 31, 2018
|
$
|
818
|
|
|
$
|
(178,215
|
)
|
|
$
|
1,169,383
|
|
|
$
|
67,854
|
|
|
$
|
(15,020
|
)
|
|
$
|
1,044,820
|
|
$
|
7,484
|
|
$
|
1,052,304
|
|
|
Year ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(in thousands, except per share amounts)
|
||||||||||
Operating activities:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(200,821
|
)
|
|
$
|
145,206
|
|
|
$
|
(41,056
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Undistributed (Income) loss from equity method investment, net
|
202,655
|
|
|
(143,057
|
)
|
|
41,564
|
|
|||
Other
|
—
|
|
|
—
|
|
|
(30
|
)
|
|||
Changes in assets and liabilities, net of effects of acquisitions:
|
|
|
|
|
|
||||||
Accounts payable and accrued liabilities
|
(295
|
)
|
|
48
|
|
|
353
|
|
|||
Net cash provided by operating activities
|
1,539
|
|
|
2,197
|
|
|
831
|
|
|||
Investing activities:
|
|
|
|
|
|
||||||
Proceeds from sales and maturities of short-term investments
|
—
|
|
|
—
|
|
|
21,872
|
|
|||
Investment in subsidiary
|
—
|
|
|
(143,654
|
)
|
|
(188,177
|
)
|
|||
Net cash provided by (used in) investing activities
|
—
|
|
|
(143,654
|
)
|
|
(166,305
|
)
|
|||
Financing activities:
|
|
|
|
|
|
||||||
Dividends paid
|
(19,912
|
)
|
|
(20,377
|
)
|
|
(15,125
|
)
|
|||
Repurchase of common stock
|
(148,469
|
)
|
|
(25,022
|
)
|
|
—
|
|
|||
Proceeds from options exercised
|
61
|
|
|
798
|
|
|
4,603
|
|
|||
Tax payments related to shares withheld for vested restricted stock and stock units
|
(4,383
|
)
|
|
(4,379
|
)
|
|
(1,590
|
)
|
|||
Issuance of common stock (secondary offering)
|
—
|
|
|
—
|
|
|
678,791
|
|
|||
Issuance of treasury stock
|
—
|
|
|
—
|
|
|
221
|
|
|||
Costs of common stock issuance
|
—
|
|
|
—
|
|
|
(25,733
|
)
|
|||
Contributions from non-controlling interest
|
7,497
|
|
|
—
|
|
|
—
|
|
|||
Net financing activities with subsidiaries
|
40,171
|
|
|
(113,294
|
)
|
|
106
|
|
|||
Net cash provided by (used in) financing activities
|
(125,035
|
)
|
|
(162,274
|
)
|
|
641,273
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
(123,496
|
)
|
|
(303,731
|
)
|
|
475,799
|
|
|||
Cash and cash equivalents, beginning of period
|
230,647
|
|
|
534,378
|
|
|
58,579
|
|
|||
Cash and cash equivalents, end of period
|
$
|
107,151
|
|
|
$
|
230,647
|
|
|
$
|
534,378
|
|
Non-cash financing activities:
|
|
|
|
|
|
||||||
Supplemental cash flow information:
|
|
|
|
|
|
||||||
Cash paid (received) during the period for:
|
|
|
|
|
|
||||||
Interest
|
$
|
(2,784
|
)
|
|
$
|
(3,853
|
)
|
|
$
|
(1,046
|
)
|
Non-cash transactions
|
|
|
|
|
|
||||||
Common stock issued for business acquisitions
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
278,229
|
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
ITEM 15.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|
|
Page
|
Third Amended and Restated Certificate of Incorporation of U.S. Silica Holdings, Inc., effective May 4, 2017.
|
|
8-K
|
|
001-35416
|
|
3.1
|
|
May 10, 2017
|
|
Third Amended and Restated Bylaws of U.S. Silica Holdings, Inc., effective May 4, 2017.
|
|
8-K
|
|
001-35416
|
|
3.2
|
|
May 10, 2017
|
|
Specimen Common Stock Certificate.
|
|
S-1/A
|
|
333-175636
|
|
4.1
|
|
December 7, 2011
|
|
Employment Agreement, dated as of March 22, 2012, by and between U.S. Silica Company and Bryan A. Shinn.
|
|
8-K
|
|
001-35416
|
|
10.11
|
|
March 22, 2012
|
|
Amended and Restated 2011 Incentive Compensation Plan.
|
|
8-K
|
|
001-35416
|
|
10.1
|
|
May 11, 2015
|
|
Form of Incentive Stock Option Agreement.
|
|
S-1/A
|
|
333-175636
|
|
10.15
|
|
August 29, 2011
|
|
Form of Restricted Stock Agreement.
|
|
S-1/A
|
|
333-175636
|
|
10.16
|
|
August 29, 2011
|
|
Form of Nonqualified Stock Option Agreement.
|
|
S-1/A
|
|
333-175636
|
|
10.17
|
|
August 29, 2011
|
|
Form of Stock Appreciation Rights Agreement.
|
|
S-1/A
|
|
333-175636
|
|
10.18
|
|
August 29, 2011
|
|
Form of Restricted Stock Unit Agreement.
|
|
S-1/A
|
|
333-175636
|
|
10.19
|
|
August 29, 2011
|
|
Form of Performance Share Unit Agreement.
|
|
10-K
|
|
001-35416
|
|
10.12
|
|
February 26, 2014
|
|
Form of Indemnification Agreement.
|
|
S-1/A
|
|
333-175636
|
|
10.20
|
|
December 29, 2011
|
|
Letter Agreement, dated as of December 27, 2011, by and between William J. Kacal and U.S. Silica Holdings, Inc.
|
|
S-1/A
|
|
333-175636
|
|
10.24
|
|
December 29, 2011
|
|
Letter Agreement, dated April 27, 2012, by and between Peter Bernard and U.S. Silica Holdings, Inc.
|
|
8-K
|
|
001-35416
|
|
10.10
|
|
May 1, 2012
|
|
Letter Agreement, dated October 8, 2013, by and between J. Michael Stice and U.S. Silica Holdings, Inc.
|
|
8-K
|
|
001-35416
|
|
10.10
|
|
October 11, 2013
|
|
Omnibus Amendment dated February 18, 2016 to Award Agreements.
|
|
8-K
|
|
001-35416
|
|
10.3
|
|
February 23, 2016
|
|
Form of Nonqualified Stock Option Agreement.
|
|
10-K
|
|
001-35416
|
|
10.2
|
|
February 25, 2015
|
|
Change in Control Severance Plan of U.S. Silica Holdings, Inc.
|
|
8-K
|
|
001-35416
|
|
10.1
|
|
February 23, 2016
|
|
Amendment dated February 18, 2016 to Employment Agreement by and between U.S. Silica Holdings, Inc. and Bryan Shinn.
|
|
8-K
|
|
001-35416
|
|
10.2
|
|
February 23, 2016
|
|
Form of Performance Share Unit Agreement (TSR metric).
|
|
10-Q
|
|
001-35416
|
|
10.4
|
|
April 27, 2016
|
|
Omnibus Amendment dated November 3, 2016 to Award Agreements.
|
|
10-K
|
|
001-35416
|
|
10.22
|
|
February 23, 2017
|
|
Amendment No. 1 dated November 3, 2016 to Amended and Restated 2011 Incentive Compensation Plan
|
|
10-K
|
|
001-35416
|
|
10.23
|
|
February 23, 2017
|
|
Letter Agreement, effective August 15, 2017, by and between Diane Duren and U.S. Silica Holdings, Inc.
|
|
8-K
|
|
001-35416
|
|
10.1
|
|
August 18, 2017
|
|
|
Form of Performance Share Unit Agreement Pursuant to the Amended and Restated U.S. Silica Holdings, Inc. 2011 Incentive Compensation Plan.
|
|
10-Q
|
|
001-35416
|
|
10.1
|
|
April 24, 2018
|
Form of Restricted Stock Unit Agreement Pursuant to the Amended and Restated U.S. Silica Holdings, Inc. 2011 Incentive Compensation Plan.
|
|
10-Q
|
|
001-35416
|
|
10.2
|
|
April 24, 2018
|
Form of Restricted Stock Agreement Pursuant to the Amended and Restated U.S. Silica Holdings, Inc. 2011 Incentive Compensation Plan.
|
|
10-Q
|
|
001-35416
|
|
10.3
|
|
April 24, 2018
|
|
Form of Restricted Stock Agreement Pursuant to the Amended and Restated U.S. Silica Holdings, Inc. 2011 Incentive Compensation Plan.
|
|
10-Q
|
|
001-35416
|
|
10.4
|
|
April 24, 2018
|
|
Third Amended and Restated Credit Agreement, dated as of May 1, 2018, by and among U.S. Silica Holdings, Inc., through its subsidiaries, USS Holdings, Inc., as guarantor, and U.S. Silica Company, as borrower, and certain of U.S. Silica’s subsidiaries as additional guarantors and BNP Paribas, as administrative agent and the lenders named therein.
|
|
8-K
|
|
001-35416
|
|
10.1
|
|
May 2, 2018
|
|
List of subsidiaries of U.S. Silica Holdings, Inc.
|
|
|
|
|
|
|
|
|
|
Consent of Independent Registered Public Accounting Firm.
|
|
|
|
|
|
|
|
|
|
Rule 13a-14(a)/15(d)-14(a) Certification by Bryan A. Shinn, Chief Executive Officer.
|
|
|
|
|
|
|
|
|
|
Rule 13a-14(a)/15(d)-14(a) Certification by Donald A. Merril, Chief Financial Officer.
|
|
|
|
|
|
|
|
|
|
Section 1350 Certification by Bryan A. Shinn, Chief Executive Officer.
|
|
|
|
|
|
|
|
|
|
Section 1350 Certification by Donald A. Merril, Chief Financial Officer.
|
|
|
|
|
|
|
|
|
|
Mine Safety Disclosure.
|
|
|
|
|
|
|
|
|
|
Consent of Rystad Energy.
|
|
|
|
|
|
|
|
|
|
101*
|
101.INS XBRL Instance
|
|
|
|
|
|
|
|
|
|
101.SCH XBRL Taxonomy Extension Schema
|
|
|
|
|
|
|
|
|
|
101.CAL XBRL Taxonomy Extension Calculation
|
|
|
|
|
|
|
|
|
|
101.LAB XBRL Taxonomy Extension Labels
|
|
|
|
|
|
|
|
|
|
101.PRE XBRL Taxonomy Extension Presentation
|
|
|
|
|
|
|
|
|
|
101.DEF XBRL Taxonomy Extension Definition
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
#
|
Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. We will furnish the omitted schedules to the Securities and Exchange Commission upon request by the Commission.
|
|
|
+
|
Management contract or compensatory plan/arrangement
|
*
|
Filed herewith
|
ITEM 16.
|
FORM 10-K SUMMARY
|
|
U.S. Silica Holdings, Inc.
|
||
|
|
||
|
/s/ BRYAN A. SHINN
|
||
|
Name:
|
|
Bryan A. Shinn
|
|
Title:
|
|
Chief Executive Officer
|
Name
|
|
Capacity
|
|
Date
|
|
|
|
||
/
S
/ B
RYAN
A. S
HINN
|
|
President, Chief Executive Officer and Director
(Principal Executive Officer)
|
|
February 19, 2019
|
Bryan A. Shinn
|
|
|
|
|
|
|
|
||
/
S
/ D
ONALD
A. M
ERRIL
|
|
Executive Vice President, Chief Financial Officer
(Principal Financial and Accounting Officer)
|
|
February 19, 2019
|
Donald A. Merril
|
|
|
|
|
|
|
|
||
/
S
/ C
HARLES
S
HAVER
|
|
Chairman of the Board
|
|
February 19, 2019
|
Charles Shaver
|
|
|
|
|
|
|
|
||
/
S
/ P
ETER
B
ERNARD
|
|
Director
|
|
February 19, 2019
|
Peter Bernard
|
|
|
|
|
|
|
|
||
/s/ DIANE DUREN
|
|
Director
|
|
February 19, 2019
|
Diane Duren
|
|
|
|
|
|
|
|
||
/
S
/ W
ILLIAM
J. K
ACAL
|
|
Director
|
|
February 19, 2019
|
William J. Kacal
|
|
|
|
|
|
|
|
||
/
S
/ J. M
ICHAEL
S
TICE
|
|
Director
|
|
February 19, 2019
|
J. Michael Stice
|
|
|
|
Name
|
Jurisdiction of Formation
|
Hourglass Acquisition I, LLC
|
Delaware
|
Preferred Rocks USS Inc.
|
Delaware
|
Hourglass Holdings, LLC
|
Delaware
|
USS Holdings, Inc.
|
Delaware
|
U.S. Silica Company
|
Delaware
|
Pennsylvania Glass Sand Corporation
|
Delaware
|
The Fulton Land and Timber Company
|
Pennsylvania
|
Ottawa Silica Company
|
Delaware
|
Ottawa Silica Company, Ltd.
|
Quebec, Canada
|
Coated Sand Solutions, LLC
|
Delaware
|
Cadre Services Inc.
|
Delaware
|
Cadre Material Products, LLC
|
Texas
|
Fairchild Silica, LLC
|
Delaware
|
Utica Silica, LLC
|
Delaware
|
Tyler Silica Company
|
Delaware
|
New Birmingham Resources, LLC
|
Texas
|
NBR Sand, LLC
|
Texas
|
NBR Maritime I, LLC
|
Texas
|
NBR Maritime II, LLC
|
Texas
|
Sandbox Enterprises, LLC
|
Texas
|
Oren Technologies, LLC
|
Texas
|
Sandbox Leasing, LLC
|
Texas
|
Sandbox Logistics, LLC
|
Texas
|
Sandbox Transportation, LLC
|
Texas
|
Mississippi Sand, LLC
|
Missouri
|
Arcadia Sand, LLC
|
Delaware
|
Boss Energy Resources, LLC
|
Delaware
|
Seagraves Development, LLC
|
Delaware
|
EP Minerals Holdings, Inc.
|
Delaware
|
EP Acquisition, LLC
|
Delaware
|
EP Management Corporation
|
Delaware
|
EP Minerals, LLC
|
Delaware
|
2473428 Ontario, Inc.
|
Ontario, Canada
|
EP Engineered Clays Corporation
|
Delaware
|
EP Minerals International S.A.S.
|
France
|
EP Minerals Europe Verwaltungs und Beteiligungs GmbH
|
Germany
|
EP Minerals Europe GmbH & Co. KG
|
Germany
|
EP Mexican Parent, Inc.
|
Delaware
|
EP Minerals de Mexico S. de R.L. de C.V.
|
Mexico
|
Celatom de Mexico S. de R.L. de C.V.
|
Mexico
|
Kermit Pipeline, LLC (50% ownership)
|
Texas
|
Spruce Acquisition, LLC
|
Delaware
|
1.
|
I have reviewed this Annual Report on Form 10-K of U.S. Silica Holdings, Inc. (the “Company”) for the year ended December 31, 2018;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ B
RYAN
A. S
HINN
|
|
Name: Bryan A. Shinn
|
|
Title: Chief Executive Officer
|
1.
|
I have reviewed this annual report on Form 10-K of U.S. Silica Holdings, Inc. (the “Company”) for the year ended December 31, 2018;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ D
ONALD
A. M
ERRIL
|
|
Name: Donald A. Merril
|
|
Title: Chief Financial Officer
|
|
i.
|
The Annual Report on Form 10-K of the Company for the year ended December 31, 2018 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
|
ii.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ B
RYAN
A. S
HINN
|
|
Name: Bryan A. Shinn
|
|
Title: Chief Executive Officer
|
|
i.
|
The Annual Report on Form 10-K of the Company for the year ended December 31, 2018 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
|
ii.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ D
ONALD
A. M
ERRIL
|
|
Name: Donald A. Merril
|
|
Title: Chief Financial Officer
|
•
|
Section 104 S&S Citations:
Citations received from MSHA under section 104 of the Mine Act for violations of mandatory health or safety standards that could significantly and substantially contribute to the cause and effect of a mine safety or health hazard.
|
•
|
Section 104(b) Orders:
Orders issued by MSHA under section 104(b) of the Mine Act, which represents a failure to abate a citation under section 104(a) within the period of time prescribed by MSHA. This results in an order of immediate withdrawal from the area of the mine affected by the condition until MSHA determines that the violation has been abated.
|
•
|
Section 104(d) Citations and Orders:
Citations and orders issued by MSHA under section 104(d) of the Mine Act for unwarrantable failure to comply with mandatory health or safety standards.
|
•
|
Section 110(b)(2) Violations:
Flagrant violations issued by MSHA under section 110(b)(2) of the Mine Act.
|
•
|
Section 107(a) Orders:
Orders issued by MSHA under section 107(a) of the Mine Act for situations in which MSHA determined an “imminent danger” (as defined by MSHA) existed.
|
Mine(a)
|
Section 104
S&S Citations(#) |
|
Section
104(b) Orders (#) |
|
Section
104(d) Citations and Orders (#) |
|
Section
110(b)(2) Violations (#) |
|
Section
107(a) Orders (#) |
|
Proposed
Assessments(b) ($, amounts in dollars) |
|
Mining
Related Fatalities (#) |
||||||||
Ottawa, IL
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
3,926
|
|
|
|
|
Mill Creek, OK
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
354
|
|
|
—
|
|
|
Pacific, MO
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
898
|
|
|
—
|
|
|
Berkeley Springs, WV
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,367
|
|
|
—
|
|
|
Mapleton Depot, PA
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,594
|
|
|
—
|
|
|
Kosse, TX
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,943
|
|
|
—
|
|
|
Mauricetown, NJ
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,045
|
|
|
—
|
|
|
Port Elizabeth
|
—
|
|
|
|
|
|
|
|
|
|
|
236
|
|
|
|
||||||
Columbia, SC
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,710
|
|
|
—
|
|
|
Montpelier, VA
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,446
|
|
|
—
|
|
|
Rockwood, MI
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,300
|
|
|
—
|
|
|
Jackson, TN
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Dubberly, LA
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
118
|
|
|
—
|
|
|
Hurtsboro, AL
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Sparta, WI
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
738
|
|
|
—
|
|
|
Voca, TX
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
996
|
|
|
—
|
|
|
Peru, IL
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,297
|
|
|
—
|
|
|
Utica, IL
|
8
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
20,916
|
|
|
—
|
|
|
Tyler, TX
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,767
|
|
|
—
|
|
|
Festus, MO
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,172
|
|
|
—
|
|
|
Seagraves, TX
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,972
|
|
|
—
|
|
|
Lamesa, TX
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,036
|
|
|
—
|
|
|
Crane County, TX
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1,907
|
|
|
—
|
|
|
Jackson, MS
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
562
|
|
|
—
|
|
|
Middletown, TN
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
118
|
|
|
—
|
|
|
Clark, NV
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,766
|
|
|
—
|
|
|
Lovelock, NV
|
12
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
1
|
|
|
297,898
|
|
|
—
|
|
|
Fernley, NV
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Vale, OR
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,383
|
|
|
—
|
|
|
Fowlkes Mine, MS
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Hazen Mine, NV
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Popcorn Mine, NV
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Colado Mine, NV
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
236
|
|
|
—
|
|
|
Celaton Mine, OR
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
587
|
|
|
—
|
|
|
Cheto Mine - AZ
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(a)
|
The definition of mine under section 3 of the Mine Act includes the mine, as well as other items used in, or to be used in, or resulting from, the work of extracting minerals, such as land, structures, facilities, equipment, machines, tools and minerals preparation facilities. Unless otherwise indicated, any of these other items associated with a single mine have been aggregated in the totals for that mine. MSHA assigns an identification number to each mine and may or may not assign separate identification numbers to related facilities such as preparation facilities. We are providing the information in the table by mine rather than MSHA identification number because that is how we manage and operate our mining
|
(b)
|
Represents the total dollar value of proposed assessments from MSHA under the Mine Act relating to any type of citation or order issued during the year ended
December 31, 2018
.
|
RYSTAD ENERGY
|
||||
|
|
|
|
|
By:
|
|
/s/ Nick Livingstone
|
||
|
|
Name:
|
|
Nick Livingstone
|
|
|
Title:
|
|
Managing Director
|