AESI New Atlas Holdco Inc

Atlas Energy Solutions Inc. (NYSE: AESI) (“Atlas” or the “Company”) today reported financial and operating results for the second quarter ended June 30, 2024.

Second Quarter 2024 Highlights

• Total sales of $287.5 million
• Net income of $14.8 million (5% Net Income Margin)
• Adjusted EBITDA of $72.0 million (25% Adjusted EBITDA Margin) (1)
• Net cash provided by operating activities of $60.9 million
• Adjusted Free Cash Flow of $66.6 million (23% Adjusted Free Cash Flow Margin) (1)
• Dune Express construction remains on-time and on-budget
• Declares increased quarterly dividend of $0.23 per share, payable August 22, 2024

Financial Summary

 

Three Months Ended

 

 

June 30, 2024

 

 

March 31, 2024

 

 

June 30, 2023

 

 

 

(unaudited, in thousands, except percentages)

Sales

 

$

287,518

 

 

$

192,667

 

 

$

161,788

 

Net income

 

$

14,837

 

 

$

26,787

 

 

$

71,211

 

Net Income Margin

 

 

5

%

 

 

14

%

 

 

44

%

Adjusted EBITDA

 

$

72,045

 

 

$

75,543

 

 

$

92,846

 

Adjusted EBITDA Margin

 

 

25

%

 

 

39

%

 

 

57

%

Net cash provided by operating activities

 

$

60,856

 

 

$

39,562

 

 

$

103,883

 

Adjusted Free Cash Flow

 

$

66,627

 

 

$

71,083

 

 

$

86,821

 

Adjusted Free Cash Flow Margin

 

 

23

%

 

 

37

%

 

 

54

%

(1)

Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Free Cash Flow and Adjusted Free Cash Flow Margin are non-GAAP financials measures. See Non-GAAP Financial Measures for a discussion of these measures and a reconciliation of these measures to our most directly comparable financial measures calculated and presented in accordance with GAAP.

John Turner, President & CEO, commented, “While second quarter results were weighed down by lower throughput and higher costs related to the reconstruction of the Kermit Feed System, the rest of our operations performed exceedingly well. The reconstruction of the damaged feed system was completed at the end of June, and, after a ramp-up period in July, Atlas is back to normal loadout operations today at Kermit. With the recovery in our productive capacity, we expect our third quarter financial results to meaningfully improve sequentially relative to those of the second quarter. I am extremely proud of our team’s remarkable response times and tireless work ethic throughout this incident, and I would like to congratulate and say thank you to our entire organization for responding so admirably to the event. We’re looking forward to the remainder of 2024 as we near the initial in-service date of the Dune Express.”

Second Quarter 2024 Financial Results

Second quarter 2024 total sales increased $94.9 million, or 49% when compared to the first quarter of 2024, to $287.5 million. Product sales increased $14.8 million, or 13% when compared to the first quarter of 2024, to $128.2 million. Second quarter 2024 sales volumes increased to 4.9 million tons, or 26% when compared to the first quarter of 2024, which was offset by lower average pricing experienced during the period. Service sales increased by $80.1 million, or 101% when compared to the first quarter of 2024, to $159.3 million. The increase in service sales was largely due to a full quarter of contribution of Hi-Crush.

Second quarter 2024 cost of sales (excluding depreciation, depletion and accretion expense) (“cost of sales”) increased by $95.4 million, or 89% when compared to the first quarter of 2024, to $202.1 million. The increase in our cost of sales was primarily driven by a full quarter of contribution associated with the Hi-Crush operations, and elevated costs associated with operations at our damaged Kermit facility.

Selling, general and administrative expenses (“SG&A”) for the second quarter of 2024 decreased $0.7 million, or 3% when compared to the first quarter of 2024, to $27.3 million. Included within our SG&A is $5.5 million in stock based compensation and $5.9 million in other acquisition related costs.

Net income for the second quarter of 2024 was $14.8 million, and Adjusted EBITDA for the second quarter of 2024 was $72.0 million.

Liquidity, Capital Expenditures and Other

As of June 30, 2024, the Company’s total liquidity was $279.2 million, which was comprised of $104.7 million in cash and cash equivalents (held in cash, CDs, and three-month Treasury bills), $74.5 million of availability under the Company’s ABL Facility, and $100 million of availability under the Company's Delayed Draw Term Loan Facility. The Company had $50.0 million of borrowings outstanding under the ABL Facility and $0.6 million of outstanding undrawn letters of credit.

Net cash used in investing activities was $115.8 million during the second quarter of 2024, driven largely by the construction of the Dune Express and additional OnCore deployments.

Quarterly Cash Dividend

On August 1, 2024, the Board of Directors of Atlas declared an increased dividend to common stockholders of $0.23 per share, or approximately $25.3 million in aggregate to shareholders. We have elected to move away from the base plus variable dividend structure to a standalone base dividend. The dividend will be payable on August 22, 2024 to shareholders of record at the close of business on August 15, 2024.

Conference Call Information

The Company will host a conference call to discuss financial and operational results on Tuesday, August 6, 2024 at 9:00am Central Time (10:00am Eastern Time). Individuals wishing to participate in the conference call should dial (877) 407-4133. A live webcast will be available at https://ir.atlas.energy/. Please access the webcast or dial in for the call at least 10 minutes ahead of the start time to ensure a proper connection. An archived version of the conference call will be available on the Company’s website shortly after the conclusion of the call.

The Company will also post an updated investor presentation titled “Investor Presentation August 2024”, in addition to a "August 2024 Growth Projects Update" video, at https://ir.atlas.energy/ in the "Presentations” section under “News & Events” tab on the Company’s Investor Relations webpage prior to the conference call.

About Atlas Energy Solutions

Atlas Energy Solutions Inc. is a leading proppant producer and proppant logistics provider, serving primarily the Permian Basin of West Texas and New Mexico. We operate 13 proppant production facilities across the Permian Basin with a combined annual production capacity of 28 million tons, including both large-scale in-basin facilities and smaller distributed mining units. We manage a portfolio of leading-edge logistics assets, which includes our 42-mile Dune Express conveyor system, which is currently under construction and is scheduled to come online in the fourth quarter of 2024. In addition to our conveyor infrastructure, we manage a fleet of 120 trucks, which are capable of delivering expanded payloads due to our custom-manufactured trailers and drop-depot process. Our approach to managing both our proppant production and proppant logistics operations is intently focused on leveraging technology, automation and remote operations to drive efficiencies.

We are a low-cost producer of various high-quality, locally sourced proppants used during the well completion process. We offer both dry and damp sand, and carry various mesh sizes including 100 mesh and 40/70 mesh. Proppant is a key component necessary to facilitate the recovery of hydrocarbons from oil and natural gas wells.

Our logistics platform is designed to increase the efficiency, safety and sustainability of the oil and natural gas industry within the Permian Basin. Proppant logistics is increasingly a differentiating factor affecting customer choice among proppant producers. The cost of delivering sand, even short distances, can be a significant component of customer spending on their well completions given the substantial volumes that are utilized in modern well designs.

We continue to invest in and pursue leading-edge technologies, including autonomous trucking, digital infrastructure, and artificial intelligence, to support opportunities to gain efficiencies in our operations. These technology-focused investments aim to improve our cost structure and also combine to produce beneficial environmental and community impacts.

While our core business is fundamentally aligned with a lower emissions economy, our core obligation has been, and will always be, to our stockholders. We recognize that maximizing value for our stockholders requires that we optimize the outcomes for our broader stakeholders, including our employees and the communities in which we operate. We are proud of the fact that our approach to innovation in the hydrocarbon industry while operating in an environmentally responsible manner creates immense value. Since our founding in 2017, our core mission has been to improve human beings’ access to the hydrocarbons that power our lives while also delivering differentiated social and environmental progress. Our Atlas team has driven innovation and has produced industry-leading environmental benefits by reducing energy consumption, emissions, and our aerial footprint. We call this Sustainable Environmental and Social Progress.

We were founded in 2017 by Ben M. “Bud” Brigham, our Executive Chairman, and are led by an entrepreneurial team with a history of constructive disruption bringing significant and complementary experience to this enterprise, including the perspective of longtime E&P operators, which provides for an elevated understanding of the end users of our products and services. Our executive management team has a proven track record with a history of generating positive returns and value creation. Our experience as E&P operators was instrumental to our understanding of the opportunity created by in-basin sand production and supply in the Permian Basin, which we view as North America’s premier shale resource and which we believe will remain its most active through economic cycles.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Statements that are predictive or prospective in nature, that depend upon or refer to future events or conditions or that include the words “may,” “assume,” “forecast,” “position,” “strategy,” “potential,” “continue,” “could,” “will,” “plan,” “project,” “budget,” “predict,” “pursue,” “target,” “seek,” “objective,” “believe,” “expect,” “anticipate,” “intend,” “estimate” and other expressions that are predictions of or indicate future events and trends and that do not relate to historical matters identify forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements about the anticipated financial performance of Atlas following our acquisition of substantially all of the Permian Basin proppant production and logistics businesses and operations of Hi-Crush Inc. (the “Hi-Crush Acquisition”); the expected synergies and efficiencies to be achieved as a result of the Hi-Crush Acquisition; statements regarding our ability to return the Kermit facility to full production, the required reconstruction; Atlas’s expectations regarding the timing of the Kermit facility’s return to full production and its utilization; statements about the availability and extent of insurance coverage; statements about the ultimate impact of the incident on Atlas’s future performance; expected accretion to free cash flow and earnings per share; expectations regarding the leverage and dividend profile of Atlas; expansion and growth of Atlas’s business; expected production volumes; our business strategy, our industry, our future operations and profitability, expected capital expenditures and the impact of such expenditures on our performance, statements about our financial position, production, revenues and losses, our capital programs, management changes, current and potential future long-term contracts and our future business and financial performance.

Although forward-looking statements reflect our good faith beliefs at the time they are made, we caution you that these forward-looking statements are subject to a number of risks and uncertainties, most of which are difficult to predict and many of which are beyond our control. These risks include but are not limited to: uncertainties as to whether the Hi-Crush Acquisition will achieve its anticipated benefits and projected synergies within the expected time period or at all; Atlas’s ability to integrate Hi-Crush Inc.’s operations in a successful manner and in the expected time period; risks that the anticipated tax treatment of the Hi-Crush Acquisition is not obtained; unforeseen or unknown liabilities; unexpected future capital expenditures; potential litigation relating to the Hi-Crush Acquisition; the effect of the completion of the Hi-Crush Acquisition on Atlas’s business relationships and business generally; risks that the Hi-Crush Acquisition disrupts current plans and operations of Atlas and its management team and potential difficulties in retaining employees as a result of the Hi-Crush Acquisition; the risks related to Atlas’s financing of the Hi-Crush Acquisition; potential negative effects of the Hi-Crush Acquisition on the market price of Atlas’s common stock or operating results; uncertainty regarding the availability of insurance proceeds to offset the cost of reconstructing the Kermit facility; risks relating to the impact of this incident on our ability to service our customers; commodity price volatility, including volatility stemming from the ongoing armed conflicts between Russia and Ukraine and Israel and Hamas; increasing hostilities and instability in the Middle East; adverse developments affecting the financial services industry; our ability to complete growth projects, including the Dune Express, on time and on budget; the risk that stockholder litigation in connection with our recent corporate reorganization may result in significant costs of defense, indemnification and liability; changes in general economic, business and political conditions, including changes in the financial markets; transaction costs; actions of OPEC+ to set and maintain oil production levels; the level of production of crude oil, natural gas and other hydrocarbons and the resultant market prices of crude oil; inflation; environmental risks; operating risks; regulatory changes; lack of demand; market share growth; the uncertainty inherent in projecting future rates of reserves; production; cash flow; access to capital; the timing of development expenditures; the ability of our customers to meet their obligations to us; our ability to maintain effective internal controls; and other factors discussed or referenced in our filings made from time to time with the U.S. Securities and Exchange Commission (“SEC”), including those discussed under the heading “Risk Factors” in Annual Report on Form 10-K, filed with the SEC on February 27, 2024, and any subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

     

Atlas Energy Solutions Inc. Condensed Consolidated Statements of Income (unaudited, in thousands, except per share data) 

 

 

 

Three Months Ended

 

 

June 30, 2024

 

March 31, 2024

 

June 30, 2023

 

 

 

 

 

 

 

Product sales

 

$

128,210

 

 

$

113,432

 

 

$

125,216

 

Service sales

 

 

159,308

 

 

 

79,235

 

 

 

36,572

 

Total sales

 

 

287,518

 

 

 

192,667

 

 

 

161,788

 

Cost of sales (excluding depreciation, depletion and accretion expense)

 

 

202,136

 

 

 

106,746

 

 

 

63,504

 

Depreciation, depletion and accretion expense

 

 

25,027

 

 

 

17,175

 

 

 

9,433

 

Gross profit

 

 

60,355

 

 

 

68,746

 

 

 

88,851

 

Selling, general and administrative expense (including stock and unit-based compensation expense of $5,466, $4,206 and $1,624, respectively.)

 

 

27,266

 

 

 

28,008

 

 

 

12,183

 

Amortization expense of acquired intangible assets

 

 

3,768

 

 

 

1,061

 

 

 

—

 

Loss on disposal of assets

 

 

11,098

 

 

 

—

 

 

 

—

 

Insurance recovery (gain)

 

 

(10,000

)

 

 

—

 

 

 

—

 

Operating income

 

 

28,223

 

 

 

39,677

 

 

 

76,668

 

Interest (expense), net

 

 

(10,458

)

 

 

(4,978

)

 

 

(521

)

Other income

 

 

138

 

 

 

23

 

 

 

118

 

Income before income taxes

 

 

17,903

 

 

 

34,722

 

 

 

76,265

 

Income tax expense

 

 

3,066

 

 

 

7,935

 

 

 

5,054

 

Net income

 

$

14,837

 

 

$

26,787

 

 

$

71,211

 

Less: Net income attributable to redeemable noncontrolling interest

 

 

 

 

 

 

32,693

 

Net income attributable to Atlas Energy Solutions Inc.

 

$

14,837

 

 

$

26,787

 

 

$

38,518

 

 

 

 

 

 

 

 

Net income per common share

 

 

 

 

 

 

Basic

 

$

0.13

 

 

$

0.26

 

 

$

0.67

 

Diluted

 

$

0.13

 

 

$

0.26

 

 

$

0.67

 

Weighted average common shares outstanding

 

 

 

 

 

 

Basic

 

 

111,064

 

 

 

102,931

 

 

 

57,148

 

Diluted

 

 

112,023

 

 

 

103,822

 

 

 

57,420

 

       

Atlas Energy Solutions Inc. Condensed Consolidated Statements of Cash Flows (unaudited, in thousands) 

 

 

 

Three Months Ended

 

 

June 30, 2024

 

March 31, 2024

 

June 30, 2023

 

 

 

 

 

 

 

Operating activities:

 

 

 

 

 

 

Net income

 

$

14,837

 

 

$

26,787

 

 

$

71,211

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

Depreciation, depletion and accretion expense

 

 

25,886

 

 

 

18,007

 

 

 

9,814

 

Amortization of debt discount

 

 

1,083

 

 

 

407

 

 

 

120

 

Amortization of deferred financing costs

 

 

118

 

 

 

78

 

 

 

104

 

Amortization expense of acquired intangible assets

 

 

3,768

 

 

 

1,061

 

 

 

—

 

Loss on disposal of assets

 

 

11,098

 

 

 

—

 

 

 

—

 

Insurance recovery (gain)

 

 

(10,000

)

 

 

—

 

 

 

—

 

Stock and unit-based compensation

 

 

5,466

 

 

 

4,206

 

 

 

1,624

 

Deferred income tax

 

 

2,758

 

 

 

7,521

 

 

 

5,819

 

Other

 

 

(744

)

 

 

(5

)

 

 

(21

)

Changes in operating assets and liabilities:

 

 

6,586

 

 

 

(18,500

)

 

 

15,212

 

Net cash provided by operating activities

 

 

60,856

 

 

 

39,562

 

 

 

103,883

 

 

 

 

 

 

 

 

Investing activities:

 

 

 

 

 

 

Purchases of property, plant and equipment

 

 

(115,790

)

 

 

(95,486

)

 

 

(85,895

)

Hi-Crush acquisition, net of cash acquired

 

 

—

 

 

 

(142,233

)

 

 

—

 

Net cash used in investing activities

 

 

(115,790

)

 

 

(237,719

)

 

 

(85,895

)

 

 

 

 

 

 

 

Financing Activities:

 

 

 

 

 

 

Payment of offering costs

 

 

—

 

 

 

—

 

 

 

(4,439

)

Proceeds from borrowings

 

 

3,039

 

 

 

198,500

 

 

 

—

 

Principal payments on term loan borrowings

 

 

(4,217

)

 

 

(1,381

)

 

 

(8,347

)

Issuance costs associated with debt financing

 

 

(416

)

 

 

(730

)

 

 

(222

)

Payments under finance leases

 

 

(846

)

 

 

(65

)

 

 

(962

)

Repayment of notes payable

 

 

(855

)

 

 

(216

)

 

 

—

 

Dividends and distributions

 

 

(24,168

)

 

 

(21,005

)

 

 

(15,000

)

Net cash provided by (used in) financing activities

 

 

(27,463

)

 

 

175,103

 

 

 

(28,970

)

Net decrease in cash and cash equivalents

 

 

(82,397

)

 

 

(23,054

)

 

 

(10,982

)

Cash and cash equivalents, beginning of period

 

 

187,120

 

 

 

210,174

 

 

 

352,656

 

Cash and cash equivalents, end of period

 

$

104,723

 

 

$

187,120

 

 

$

341,674

 

       

Atlas Energy Solutions Inc. Condensed Consolidated Balance Sheets (in thousands) 

 

 

 

As of

 

As of

 

 

June 30, 2024

 

December 31, 2023

 

 

(unaudited)

 

 

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

104,723

 

 

$

210,174

 

Accounts receivable, including related parties

 

 

197,072

 

 

 

71,170

 

Inventories, prepaid expenses and other current assets

 

 

63,361

 

 

 

37,342

 

Total current assets

 

 

365,156

 

 

 

318,686

 

Property, plant and equipment, net

 

 

1,403,417

 

 

 

934,660

 

Right-of-use assets

 

 

22,664

 

 

 

4,151

 

Goodwill

 

 

75,219

 

 

 

—

 

Intangible assets

 

 

112,422

 

 

 

1,767

 

Other long-term assets

 

 

3,451

 

 

 

2,422

 

Total assets

 

$

1,982,329

 

 

$

1,261,686

 

Liabilities and stockholders' equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable, including related parties

 

 

103,877

 

 

 

61,159

 

Accrued liabilities and other current liabilities

 

 

104,903

 

 

 

31,433

 

Current portion of long-term debt

 

 

30,553

 

 

 

—

 

Total current liabilities

 

 

239,333

 

 

 

92,592

 

Long-term debt, net of discount and deferred financing costs

 

 

447,450

 

 

 

172,820

 

Deferred tax liabilities

 

 

207,027

 

 

 

121,529

 

Other long-term liabilities

 

 

26,559

 

 

 

6,921

 

Total liabilities

 

 

920,369

 

 

 

393,862

 

Total stockholders' and members' equity

 

 

1,061,960

 

 

 

867,824

 

Total liabilities and stockholders’ equity

 

$

1,982,329

 

 

$

1,261,686

 

     

Non-GAAP Financial Measures

Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Free Cash Flow, Adjusted Free Cash Flow Margin, Adjusted Free Cash Flow Conversion and Maintenance Capital Expenditures are non-GAAP supplemental financial measures used by our management and by external users of our financial statements such as investors, research analysts and others, in the case of Adjusted EBITDA, to assess our operating performance on a consistent basis across periods by removing the effects of development activities, provide views on capital resources available to organically fund growth projects and, in the case of Adjusted Free Cash Flow, assess the financial performance of our assets and their ability to sustain dividends or reinvest to organically fund growth projects over the long term without regard to financing methods, capital structure, or historical cost basis.

These measures do not represent and should not be considered alternatives to, or more meaningful than, net income, income from operations, net cash provided by operating activities or any other measure of financial performance presented in accordance with GAAP as measures of our financial performance. Adjusted EBITDA and Adjusted Free Cash Flow have important limitations as analytical tools because they exclude some but not all items that affect net income, the most directly comparable GAAP financial measure. Our computation of Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Free Cash Flow, Adjusted Free Cash Flow Margin, Adjusted Free Cash Flow Conversion and Maintenance Capital Expenditures may differ from computations of similarly titled measures of other companies.

Non-GAAP Measure Definitions:

• We define Adjusted EBITDA as net income before depreciation, depletion and accretion, interest expense, income tax expense, stock and unit-based compensation, loss on extinguishment of debt, loss on disposal of assets, insurance recovery (gain), unrealized commodity derivative gain (loss), other acquisition related costs, and non-recurring transaction costs. Management believes Adjusted EBITDA is useful because it allows management to more effectively evaluate the Company’s operating performance and compare the results of its operations from period to period and against our peers without regard to financing method or capital structure. We exclude the items listed above from net income in arriving at Adjusted EBITDA because these amounts can vary substantially from company to company within our industry depending upon accounting methods and book values of assets, capital structures and the method by which the assets were acquired.
• We define Adjusted EBITDA Margin as Adjusted EBITDA divided by total sales.
• We define Adjusted Free Cash Flow as Adjusted EBITDA less Maintenance Capital Expenditures. Management believes that Adjusted Free Cash Flow is useful to investors as it provides a measure of the ability of our business to generate cash.
• We define Adjusted Free Cash Flow Margin as Adjusted Free Cash Flow divided by total sales.
• We define Adjusted Free Cash Flow Conversion as Adjusted Free Cash Flow divided by Adjusted EBITDA.
• We define Maintenance Capital Expenditures as capital expenditures excluding growth capital expenditures and reconstruction of previously incurred growth capital expenditures.

     

Atlas Energy Solutions Inc. – Supplemental Information Reconciliation of Adjusted EBITDA and Adjusted Free Cash Flow to Net Income (unaudited, in thousands) 

 

 

 

Three Months Ended

 

 

June 30, 2024

 

March 31, 2024

 

June 30, 2023

Net income

 

$

14,837

 

 

$

26,787

 

 

$

71,211

 

Depreciation, depletion and accretion expense

 

 

25,886

 

 

 

18,007

 

 

 

9,814

 

Amortization expense of acquired intangible assets

 

 

3,768

 

 

 

1,061

 

 

 

—

 

Interest expense

 

 

12,014

 

 

 

6,976

 

 

 

4,027

 

Income tax expense

 

 

3,066

 

 

 

7,935

 

 

 

5,054

 

EBITDA

 

$

59,571

 

 

$

60,766

 

 

$

90,106

 

Stock and unit-based compensation

 

 

5,466

 

 

 

4,206

 

 

 

1,624

 

Non-recurring transaction costs

 

 

22

 

 

 

368

 

 

 

1,116

 

Other acquisition related costs(1)

 

 

5,888

 

 

 

10,203

 

 

 

—

 

Loss on disposal of assets(2)

 

 

11,098

 

 

 

—

 

 

 

—

 

Insurance recovery (gain)(3)

 

 

(10,000

)

 

 

—

 

 

 

—

 

Adjusted EBITDA

 

$

72,045

 

 

$

75,543

 

 

$

92,846

 

Maintenance Capital Expenditures

 

$

5,418

 

 

$

4,460

 

 

$

6,025

 

Adjusted Free Cash Flow

 

$

66,627

 

 

$

71,083

 

 

$

86,821

 

       

Atlas Energy Solutions Inc. – Supplemental Information Reconciliation of Adjusted Free Cash Flow to Net Cash Provided by Operating Activities (unaudited, in thousands, except percentages) 

 

 

 

Three Months Ended

 

 

June 30, 2024

 

March 31, 2024

 

June 30, 2023

Net cash provided by operating activities

 

$

60,856

 

 

$

39,562

 

 

$

103,883

 

Current income tax expense (benefit)(4)

 

 

308

 

 

 

414

 

 

 

(765

)

Change in operating assets and liabilities

 

 

(6,586

)

 

 

18,500

 

 

 

(15,212

)

Cash interest expense(4)

 

 

10,813

 

 

 

6,491

 

 

 

3,804

 

Maintenance capital expenditures(4)

 

 

(5,418

)

 

 

(4,460

)

 

 

(6,025

)

Non-recurring transaction costs

 

 

22

 

 

 

368

 

 

 

1,116

 

Other acquisition related costs

 

 

5,888

 

 

 

10,203

 

 

 

—

 

Other

 

 

744

 

 

 

5

 

 

 

20

 

Adjusted Free Cash Flow

 

$

66,627

 

 

$

71,083

 

 

$

86,821

 

Adjusted EBITDA Margin

 

 

25

%

 

 

39

%

 

 

57

%

Adjusted Free Cash Flow Margin

 

 

23

%

 

 

37

%

 

 

54

%

Adjusted Free Cash Flow Conversion

 

 

92

%

 

 

94

%

 

 

94

%

(1)

Represents Hi-Crush Transaction costs include fees paid to finance, legal, accounting and other advisors, employee retention and benefit costs, and other operational and corporate costs.

(2)

Represents loss on disposal of assets as a result of the fire at one of the Kermit plants that caused damage to the physical condition of the Kermit asset group. 

(3)

Represents insurance recovery (gain) deemed collectible and legally enforceable related to the fire at one of the Kermit plants. 

(4)

A reconciliation of the adjustment of these items used to calculate Adjusted Free Cash Flow to the Consolidated Financial Statements is included below. 

       

Atlas Energy Solutions Inc. – Supplemental Information Reconciliation of Maintenance Capital Expenditures to Purchase of Property, Plant and Equipment (unaudited, in thousands) 

 

 

 

Three Months Ended

 

 

June 30, 2024

 

March 31, 2024

 

June 30, 2023

Maintenance Capital Expenditures, accrual basis reconciliation:

 

 

 

 

 

 

Purchases of property, plant and equipment

 

$

115,790

 

 

$

95,486

 

 

$

85,895

 

Changes in operating assets and liabilities associated with investing activities(1)

 

 

16,134

 

 

 

(2,575

)

 

 

20,996

 

Less: Growth capital expenditures and reconstruction of previously incurred growth capital expenditures

 

 

(126,506

)

 

 

(88,451

)

 

 

(100,866

)

Maintenance Capital Expenditures, accrual basis

 

$

5,418

 

 

$

4,460

 

 

$

6,025

 

(1)

Positive working capital changes reflect capital expenditures in the current period that will be paid in a future period. Negative working capital changes reflect capital expenditures incurred in a prior period but paid during the period presented.

     

Atlas Energy Solutions Inc. – Supplemental Information Reconciliation of Current Income Tax Expense to Income Tax Expense (unaudited, in thousands) 

 

 

 

Three Months Ended

 

 

June 30, 2024

 

March 31, 2024

 

June 30, 2023

Current tax expense reconciliation:

 

 

 

 

 

 

Income tax expense

 

$

3,066

 

 

$

7,935

 

 

$

5,054

 

Less: deferred tax expense

 

 

(2,758

)

 

 

(7,521

)

 

 

(5,819

)

Current income tax expense (benefit)

 

$

308

 

 

$

414

 

 

$

(765

)

     

Atlas Energy Solutions Inc. – Supplemental Information Cash Interest Expense to Income Expense, Net (unaudited, in thousands) 

 

 

 

Three Months Ended

 

 

June 30, 2024

 

March 31, 2024

 

June 30, 2023

Cash interest expense reconciliation:

 

 

 

 

 

 

Interest expense, net

 

$

10,458

 

 

$

4,978

 

 

$

521

 

Less: Amortization of debt discount

 

 

(1,083

)

 

 

(407

)

 

 

(120

)

Less: Amortization of deferred financing costs

 

 

(118

)

 

 

(78

)

 

 

(104

)

Less: Interest income

 

 

1,556

 

 

 

1,998

 

 

 

3,507

 

Cash interest expense

 

$

10,813

 

 

$

6,491

 

 

$

3,804

 

   

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240805397647/en/

Investor Contact Kyle Turlington 5918 W Courtyard Drive, Suite #500 Austin, Texas 78730 United States T: 512-220-1200 IR@atlas.energy