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U.S. Silica Holdings (SLCA) |
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WIKI ANALYSIS
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This company completed an initial public offering (IPO) of its stock in 2010. View articles that reference this company. Recent IPOs: Globe Specialty Metals • LogMeIn • Invesco Mortgage Capital • Medidata • Chemspec |
U.S Silica (NYSE:SLCA) produces and sells silica for commercials uses. The company makes money by selling its end product to oil and gas, glass making, chemical, solar panel, and other industries. However, US Silica's largest customers are oil and gas companies which use the silica in hyrdofracking. US Silica mines and distributes its products within the United States.[1]
Business Overview
For the first nine months of 2011, US Silica reported a total sales of $212M. This compares to $20.2M in net income. For comparison, the same period in 2010 resulted in $185M in sales and $7.6M in net income.[2]
New Updates
The company's initial public offering of stock on the NYSE occurred on January 31, 2012. The company offered 11.8M shares each for $17. This was within the $16-$18 initial price range. The deal raised a total of $200M. The lead mangers of the deal were Morgan Stanley (MS), BofA, and Jefferies Group (JEF).[3]
Trends & Forces
Reliance on Oil & Gas
US Silica's largest end market is the oil and gas industry which uses the silica as "frac sand." This sand is injected with water under high pressure in order to generate fractures in the rock. These fractures improve the well's oil or gas output.[4] However, this practice, known as hyrdofracking, has undergone scrutiny both by the public and by regulatory officials. The fear is that such practices can contaminate the water streams. If this practice is regulated, US Silica's largest market will likely decrease its demand for silica.[5]
- ↑ SLCA S-1/A 2012 PROSPECTUS SUMMARY "Our Company" pg. 1-2
- ↑ SLCA S-1/A 2012 PROSPECTUS SUMMARY "Summary Historical Combined Financial and Operating Data" pg. 11-12
- ↑ Renaissance Capital - IPO Home "U.S. Silica prices IPO at $17 midpoint" 1 Feb 2012
- ↑ SLCA S-1/A 2012 PROSPECTUS SUMMARY "Risk Factors" pg. 15-18
- ↑ New York Times "Extracting Natural Gas from Rock" 26 Feb 2011
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