Hi-Crush Partners LP — Q1 2019 Earnings Presentation
21 slides from Hi-Crush Partners LP's earnings presentation, May 7, 2019
Slide 1: Investor Presentation May 2019
Investor Presentation May 2019 NYSE: HCLP hicrush.com
Slide 2: Forward Looking Statements and Non-GAAP Measures
Forward Looking Statements and Non-GAAP Measures Forward-Looking Statements and Cautionary Statements The foregoing contains “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. All statements, other than statements of historical f
Slide 3: Business Update
Business Update 3
Slide 4: Latest Business Updates
Latest Business Updates Last Mile Technology: Logistics Expansion: Acquired BulkTracer, owner of the Acquired remaining ownership interest PropDispatch software that enables real- in Pronghorn Logistics, expanding last time logistics management for the last mile customer relationships and reach mile
Slide 5: PropDispatch: Real-Time Logistics Management
PropDispatch: Real-Time Logistics Management Advancing our last mile platform with differentiated technology Overview • In January 2019, acquired BulkTracer Holdings, the owner and developer of PropDispatch software • PropDispatch software enables real-time tracking and monitoring of truck movements
Slide 6: Pronghorn Logistics: Extending Last Mile Innovation
Pronghorn Logistics: Extending Last Mile Innovation Combination with Pronghorn expands PropStream as a leader in logistics services across all major shale basins Acquisition Highlights • In Q2 2019, Hi-Crush acquired remaining • Complementary Footprint – Creates a network ownership interests in Pron
Slide 7: Operational Update - Q1 2019
Operational Update - Q1 2019 63% Success in Direct Sales to E&Ps Volumes sold direct to • 63% of sales volumes in Q1 2019 sold to E&P customers E&Ps, up from 51% in Q4 2018 • Up significantly from 33% in Q1 2018 24% Second Kermit Facility Ramp Volumes sold through • Achieved full production capabili
Slide 8: E&P Customer Benefits of Aligning with Hi-Crush
E&P Customer Benefits of Aligning with Hi-Crush Aligning with Hi-Crush supports enhanced operations and efficiency Dedicated frac sand Optionality in last mile Diversification across provider with sand, and in-basin delivery regions from operations in silos and containers points multiple basins prod
Slide 9: Hi-Crush Benefits of Aligning with E&P Customers
Hi-Crush Benefits of Aligning with E&P Customers Relationship Driven Long project lead times and significant capital requirements drive E&Ps to value strategic 63% of quarterly sales volumes in Q1 2019 relationships with suppliers who offer sold to E&P customers differentiated solutions 63% Better V
Slide 10: Sustainable Capital Position
Sustainable Capital Position Balance sheet flexibility enables Hi-Crush to address changing market dynamics and opportunities Strong Flexible Conservative Cash & liquidity Capital position Leverage $60mm60mm11 No $444mm / $384mm1 Cash Position Maintenance Covenants Total Debt / Net Debt No No 2.4x1
Slide 11: Corporate Conversion Process Update
Corporate Conversion Process Update Conversion to C-Corporation expected to be completed by end of Q2 2019 Simplify Current Corporate Structure Remove structural hurdles to conversion and align interests of management and the unitholders Determine Optimal Conversion Structure Due diligence to determ
Slide 12: Fulfilling Our Corporate Responsibilities
Fulfilling Our Corporate Responsibilities From our CEO Evidence of Our Commitment “The most important asset at Hi-Crush Behavior-based safety program is our people. Ensuring the health and ingrained in all aspects of our safety of our workers is a core culture across mine and logistics element of ou
Slide 13: Financial Results and Outlook
Financial Results and Outlook 13
Slide 14: Financial & Operating Outlook
Financial & Operating Outlook Metric Guidance Value Period Quarterly sales volumes 2.5 – 2.7mm tons Q2 2019 Capital expenditures: 2018 carryover growth capex1 $30 – $35mm 1H 2019 Maintenance capex2 $20 – $25mm FY 2019 2019 growth capex3 $30 – $40mm FY 2019 DD&A expense4 $13.5 – $14.5mm Q2 2019 G&A e
Slide 15: Maintaining Capital Discipline
Maintaining Capital Discipline More than ample liquidity to meet 2019 capital uses Capital Sources Capital Uses Interest payments EBITDA Maintenance capex Cash 2019 growth capex ABL availability 2018 carryover growth capex . In-Basin and Northern White Sand . PropStream logistics and s
Slide 16: Sales Volume Q1 2019
Sales Volume Q1 2019 • Higher sequential volumes driven by ramp of second Kermit facility to nameplate capacity of 3mm TPY • 63% of volumes sold direct to E&P customers in Q1 2019, up from 51% in Q4 2018 • Completed Wyeville expansion, with production ramping to nameplate capacity in Q2 2019 000s to
Slide 17: Key Financial Metrics
Key Financial Metrics $ in 000s, except per ton Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Revenues $ 218,113 $ 248,520 $ 213,972 $ 162,235 $ 159,910 Adjusted EBITDA1 $ 64,062 $ 80,552 $ 51,347 $ 10,179 $ 16,215 Average selling price ($/ton) $ 73 $ 70 $ 64 $ 58 $ 48 Sales volumes (tons) 2,617,627 3,037
Slide 18: Q1 2019 Summary – Statements of Operations
Q1 2019 Summary – Statements of Operations Unaudited Quarterly Consolidated Statements of Operations (Amounts in thousands, except per unit amounts) Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Revenues $ 218,113 $ 248,520 $ 213,972 $ 162,235 $ 159,910 Cost of goods sold (excluding depreciation, depletio
Slide 19: Q1 2019 Summary – EBITDA and Adjusted EBITDA
Q1 2019 Summary – EBITDA and Adjusted EBITDA Unaudited EBITDA and Adjusted EBITDA (Amounts in thousands) Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Reconciliation of Adjusted EBITDA to net income: Net income (loss) $ 53,431 $ 66,956 $ 27,138 $ (9,930) $ (6,207) Depreciation and depletion expense 7,903
Slide 20: Solid Balance Sheet
Solid Balance Sheet Strong liquidity and financial flexibility No maturities before 2023 and no maintenance covenants $ in 000s December 31, 2018 March 31, 2019 Cash $ 114,256 $ 60,404 ABL Facility - - Senior unsecured notes1 440,625 440,935 Other notes payable 4,852 3,113 Total debt $ 445,477 $ 444
Slide 21: Investor Contacts
Investor Contacts Caldwell Bailey Lead Analyst, Investor Relations Marc Silverberg Managing Director (ICR, Inc.) Phone: (713) 980-6270 E-mail: ir@hicrush.com 21