The following is a summary of the Smart Sand, Inc. (SND) Q1 2024 Earnings Call Transcript:
Financial Performance:
Smart Sand posted strong Q1 sales volumes with an increase of about 31% to 1.3 million tons.
There was a boost in contribution margin to $18.5 million, and adjusted EBITDA rose to $9.3 million, showing improvement over Q4 2023.
However, Q1 2024 saw negative free cash flow primarily due to increased working capital investments to support sales acceleration.
First quarter revenues increased to $83.1 million, up from $61.9 million in the previous quarter, attributed to higher sand sales volumes and smart system revenues.
Business Progress:
The company is expanding its Northern White sand franchise, and opened two new terminals in Northeast Ohio, marking expansion in the Utica shale basin.
Improvements are being made to mining and processing operations, which will enhance yields and reduce costs.
Stable pricing is noted due to a balance of supply-demand, with potential price increases in the Canadian and Ohio markets.
The firm aims to grow the industrial segment to at least 10% in the next 2-3 years, signaling potential contracts in 2025 and 2026.
Increased interest is seen in Northern White sand, particularly from E&P companies in Texas targeting decline curves, offering potential significant benefits to Smart Sand.
More details: Smart Sand IR
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