U.S. Silica's (SLCA) Earnings and Revenues Rise Y/Y in Q4
U.S. Silica Holdings, Inc. SLCA recorded net earnings of 40 cents per share in the fourth quarter of 2022 against a loss of 25 cents in the prior-year quarter.
Adjusted earnings in the reported quarter were 43 cents per share against a loss of 22 cents in the year-ago quarter.
U.S. Silica generated revenues of $412.9 million, up around 45% year over year. The company gained from price increases across all of its business segments, which partly offset the impacts of cost inflation. SLCA also saw strong well completion demand in its oil & gas segment.
U.S. Silica Holdings, Inc. Price, Consensus and EPS Surprise
U.S. Silica Holdings, Inc. price-consensus-eps-surprise-chart | U.S. Silica Holdings, Inc. Quote
Segment Highlights
Revenues in the Oil & Gas division amounted to $273.7 million in the reported quarter, up 73% year over year and 2% sequentially. Sales volume increased 15% year over year to 3.568 million tons. The Oil & Gas contribution margin rose 11% sequentially and 214% year over year to $94.4 million or $26.47 per ton.
Revenues in the Industrial & Specialty Products division amounted to $139.2 million in the quarter, up 10% year over year and down 8% sequentially. Sales volume decreased 4% year over year to 1.038 million tons. The segment’s contribution margin was $40 million or $38.54 per ton in the quarter, down 14% sequentially and 4% year over year.
FY22 Results
Full-year 2022 earnings were $1.01 per share against a loss of 45 cents recorded a year ago. Net sales climbed 38% to $1,525.1 million.
Financials
At the end of the quarter, the company’s cash and cash equivalents were $280.8 million, up around 17.3% year over year. Long-term debt was $1,037 million, down around 13%.
Outlook
For the first quarter of 2023, U.S. Silica noted that its two business segments are well-placed in their respective markets. It has a strong portfolio of Industrial and Specialty Products that serve several essential, high-growth and attractive end markets, backed by a strong pipeline of new products under development. It also expects growth in its underlying base business, along with pricing hikes and surcharges, to continue combating inflationary impacts.
In the Oil & Gas segment, the company expects a multi-year growth cycle. The strength in WTI crude oil and natural gas prices supports an active well completions environment in 2023.
The company is focused on delivering free cash flow in 2023, deleveraging its balance sheet and plans to have positive operating cash flow in 2023 as well. It forecasts capital expenditures in the range of $50-$60 million.
Price Performance
Shares of U.S. Silica have lost 8.7% in the past year compared with a 22% decline of the industry.
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Zacks Rank & Key Picks
U.S. Silica currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks to consider in the basic materials space are Olympic Steel, Inc. ZEUS, ATI Inc. ATI, and Cal-Maine Foods, Inc. CALM. All three stocks currently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Olympic Steel’s shares have gained 77.7% in the past year. The Zacks Consensus Estimate for ZEUS’s current-year earnings has been revised 20.6% upward in the past 60 days. ZEUS topped Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 26.2% on average.
ATI’s shares have gained 59.7% in the past year. The Zacks Consensus Estimate for ATI’s current-year earnings has been revised 1.9% upward in the past 60 days. The company has an earnings growth rate of 9% for the current year.
ATI topped Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 32.4% on average.
Cal-Maine’s shares have gained 29.5% in the past year. The company has an earnings growth rate of 515.8% for the current year. The Zacks Consensus Estimate for CALM’s current-year earnings has been revised 36.4% upward in the past 60 days.
CALM topped Zacks Consensus Estimate in three of the last four quarters. It delivered a trailing four-quarter earnings surprise of 15.3% on average.
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