U.S. Silica Holdings, Inc. recently announced a net loss of $12 million, or $0.19 per basic and diluted share, for the second quarter ended June 30, 2016, compared with net income of $10 million for the second quarter of 2015. The second quarter results were negatively impacted by $1.1 million in restructuring costs for actions designed to help bring the business more in line with current market conditions and $0.9 million of business development-related expense.

“I’m very pleased with our overall performance in the quarter, especially given the continued headwinds we are facing in our oil and gas business,” said Bryan Shinn, president and CEO. “Our industrial business had one of the best quarters in its 116-year history, we generated positive operating cash flow and subsequent to the end of the quarter used our best-in-class balance sheet to facilitate an accretive acquisition that enables us to profitably increase our market share in oil and gas.”

Revenue totaled $117 million, compared with $147.5 million for the same period last year, a decrease of 21% on a year-over-year basis and a decrease of 5% sequentially from the first quarter of 2016. Overall tons sold totaled 2.2 million, down 1% compared with the 2.3 million tons sold in the second quarter of 2015 and a decrease of 2% sequentially from the first quarter of 2016. Contribution margin for the quarter was $15.5 million, down 53% compared with $32.8 million in the same period last year and down 13% sequentially from the first quarter of 2016. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) was $5.4 million, compared with adjusted EBITDA of $23.4 million for the same period last year, a decrease of 77% on a year-over-year basis and an increase of 2% sequentially compared with the first quarter of 2016.

Revenue in the Oil and Gas segment for the quarter totaled $64.9 million, compared with $90.9 million in the same period in 2015, a decrease of 29% on a year-over-year basis and a decrease of 12% sequentially from the first quarter of 2016. Tons sold totaled 1.3 million, an increase of 9% compared with 1.2 million tons sold in the second quarter of 2015 and a decrease of 6% sequentially, compared with the tons sold in the first quarter of 2016. 55% of tons were sold in basin, compared with 62% sold in basin in the second quarter of 2015, and 49% for the first quarter of 2016. Segment contribution margin was a loss of $6 million vs. a profit of $13.3 million in the second quarter of 2015, a decrease of 145% on a year-over-year basis.

Industrial and Specialty Products’ revenue for the quarter totaled $52.1 million, compared with $56.7 million for the same period in 2015, a decrease of 8% on a year-over-year basis and an increase of 7% on a sequential basis from the first quarter of 2016. Tons sold totaled 0.9 million, a decrease of 13% on a year-over-year basis and an increase of 5% on a sequential basis, compared with the first quarter of 2016. Segment contribution margin was $21.5 million, compared with $19.5 million in the second quarter of 2015, an increase of 10% on a year-over-year basis and up 27% sequentially compared with the first quarter of 2016.

On July 15, 2016, the company entered into an agreement and plan of merger to acquire all of the outstanding capital stock of New Birmingham, Inc., a low-cost, regional frac sand producer with more than 20 years of quality reserves located near Tyler, Texas, for approximately $210 million, subject to customary adjustments at closing. The transaction is expected to close in August 2016.

Due to the current lack of visibility in its Oil and Gas business, the company will continue to refrain from providing guidance for adjusted EBITDA until such time as it can gain more clarity around its customers’ business activity levels and the associated demand for its products. Based on current market conditions, the company anticipates that its capital expenditures for 2016, including the aforementioned reserves purchase, will be in the range of $28 million to $33 million.

For more information, visit www.ussilica.com.