Hi-Crush Partners LP (NYSE:HCLP) Q3 2016 Earnings Conference Call - Preliminary Transcript

Nov 01, 2016 • 08:30 am ET


Hi-Crush Partners LP (NYSE:HCLP) Q3 2016 Earnings Conference Call - Preliminary Transcript


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Good morning, and welcome to the Hi-Crush Third Quarter 2016 Conference Call. As a reminder, today's call is being recorded. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation.

At this time, for opening remarks and introductions, I would like to turn the call over to Mr. Duane Scardino, Corporate Development Manager of Hi-Crush. Please go ahead.

Duane Scardino

Thank you. Good morning, everyone, and thank you for joining us today to discuss Hi-Crush's third quarter 2016 results. With me today are Bob Rasmus, Chief Executive Officer of Hi-Crush; and Laura Fulton, Chief Financial Officer.

Before Bob and Laura provide their prepared remarks, I would like to remind all participants that our comments today will include forward-looking statements, which are subject to certain risks and uncertainties. Please note that actual results could differ materially from those projected in any forward-looking statements.

Additionally, we may refer to non-GAAP measures of EBITDA, adjusted EBITDA, distributable cash flow and contribution margin during the call. Please refer to our public filings for definitions of our non-GAAP measures and the reconciliation of these measures to net income as well as the discussion of risks and uncertainties.

With that, I would now turn the call over to Bob to discuss our announcement made yesterday before Laura provides a discussion of the third quarter results. Bob?

Robert E. Rasmus

Thanks, Duane, and thanks, everyone, for joining us on the call today. We saw positive trends in overall activity and volume levels during this quarter; and Laura will discuss those in more detail during her portion of the remarks. But before she begins, I want to spend some time on the announcement we made yesterday.

Over the last several years, Hi-Crush has been successful in evolving as a company and as a business. Generally, this has been accomplished through greenfield development and purpose-built solutions. Our evolution included our transformational acquisition of D&I Silica in 2013. D&I helped establish the foundation of our in-basin capabilities. As you saw in our release yesterday, those capabilities have now been extended to the well site with the expansion of last-mile services using our new PropStream integrated delivery solution.

We've recently completed a very successful pilot test of the PropStream solution on a 30-stage completion with a leading pressure pumper in the Permian. We are extremely pleased with how our team and system performed, and we are excited to expand this offering to our customer base and the industry.

So with that in mind, I'd like to take a few minutes to discuss the PropStream solution that we've been developing over the last year, and what it means for our customers and for Hi-Crush. Our goal has always been to be the proppant supplier of choice, and going forward it's very clear that having a premier logistics network and an integrated supply chain are keys to meeting our customers' growing demands.

First, this was accomplished by providing logistic services to the terminal. Now, by focusing on the last mile