Boston, MA 05/14/2014 (wallstreetpr) – Emerge Energy Services LP (NYSE:EMES) reported net income of $18.5 million or $0.77 per diluted share (1Q2013: $9.9 million) and revenue of $274.1 million, up by 80% (1Q2013: $152.1 million) due to higher volumes sold despite cold climatic conditions.
High segment income
Sand segment’s revenue increased to $64.3 million due to the significant rise in sales at the Barron facility and trans-load facilities. Now, the average utilization of Barron facility rose to 82% of its capacity that increased the total volumes to 882K tons. It offset the increased costs of production and SG&A expenses and raised the segment income by 91% to $19.5 million from $10.2 million in 1Q2013.
Fuel segment’s revenues also increased significantly to $209.7 million (1Q2013: $120 million) due to higher volumes sold during the period as a result of the acquisition of Direct Fuels and strong transmix volumes. It improved the segment income to $4.5 million (1Q2013: 3.9 million).
Based on the increasing efficiency across the segments, the adjusted EBITDA in 1Q2014 increased by 62% to $28.0 million (1Q2013: $17.3 million).
Improved distributable cash flow
Emerge Energy Services LP (NYSE:EMES)’s capital spending for 1Q2014 was $6.3 million, including the maintenance capex of $0.9 million. So, the Company generated $25.1 million of distributable cash flow during the first quarter 2014 and expects to generate cash flow of $90-$95 million in FY2014.
Conclusion
The demand for high quality frac sand is growing faster than others and the price remains strong for finer grades. The growing trend support Emerge mines as it processes the industry leading frac sand. So the Company keeps on strengthening the relationships and long-term contracts for both the segments to provide stability in future cash flow.
Emerge Energy Services LP (NYSE:EMES) has sufficient capital to pursue growth through acquisition and optimization of assets. So, the energy provider continues to expand its capabilities to access new and adjacent markets to create organic growth opportunities.
