Release Date: November 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Given the efficiency gains in completion and the rise in proppant demand per well, how do you see this evolving? Will it plateau or continue to rise? A: We've seen proppant per foot increase significantly, and while there might be some moderation, the demand for large amounts of sand on multi-well pads is driving overall demand. Longer laterals per well also contribute to increased sand usage.
Q: Can you provide guidance on pricing dynamics and contribution margin for 2024 and 2025? A: Pricing has been relatively flat, but we expect improvement in 2025 due to growing demand, particularly for natural gas and finer mesh sand. This should constrain Northern White supply and lead to pricing improvements.
Q: Regarding Industrial Products Solutions (IPS), you mentioned it could grow from 5% to 10% of volumes in 2025. Is this based on current orders or bids? A: The growth is based on ongoing business development, particularly in glass sand, which drives volume. While IPS is promising, frac sand will remain the primary volume driver.
Q: How are you approaching shareholder returns, and why was a special dividend chosen? A: Our approach is driven by consistent free cash flow generation and a stronger capital structure. We aim to be opportunistic, evaluating whether dividends or share buybacks offer better returns for shareholders.
Q: Can you update us on the Canadian market and your expectations for 2025 and beyond? A: The Canadian market is promising, especially with our Blair facility's logistics. The demand for natural gas and sand is expected to grow, supported by pipelines to the West Coast and LNG facilities.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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