Smart Sand Inc
For the period ended Jun 30, 2024. Filed Aug 13, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 13, 2024
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| ☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the Quarterly Period Ended June 30, 2024
OR
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the Transition Period from ___ to ___
Commission file number 001-37936
(Exact name of registrant as specified in its charter)
| Delaware | 45-2809926 |
|---|---|
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
| 1000 Floral Vale Boulevard, Suite 225 | |
| Yardley, Pennsylvania 19067 | (281) 231-2660 |
| (Address of principal executive offices) | (Registrant’s telephone number) |
| Securities registered pursuant to Section 12(b) of the Act: | ||
|---|---|---|
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| Common Stock, par value $0.001 per share | SND | Nasdaq Global Select Market |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | Accelerated filer ☐ | Non-accelerated Filer ☒ | Smaller reporting company | ☒ | Emerging Growth Company | ☐ |
|---|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes☐ No☒
Number of shares of common stock outstanding, par value $0.001 per share, as of August 5, 2024:42,926,544
TABLE OF CONTENTS
| PAGE | ||
|---|---|---|
| PART I · FINANCIAL INFORMATION | ||
| ITEM 1. | Financial Statements | 3 |
| Condensed Consolidated Balance Sheets as of June 30, 2024 (Unaudited) and December 31, 2023 | 3 | |
| Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2024 and 2023 (Unaudited) | 4 | |
| Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months Ended June 30, 2024 and 2023 (Unaudited) | 5 | |
| Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Six Months Ended June 30, 2024 and 2023 (Unaudited) | 6 | |
| Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023 (Unaudited) | 8 | |
| Notes to the Condensed Consolidated Financial Statements (Unaudited) | 9 | |
| ITEM 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 18 |
| ITEM 3. | Quantitative and Qualitative Disclosures about Market Risk | 30 |
| ITEM 4. | Controls and Procedures | 30 |
| PART II | OTHER INFORMATION | 31 |
| ITEM 1. | Legal Proceedings | 31 |
| ITEM 1A. | Risk Factors | 31 |
| ITEM 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 31 |
| ITEM 3. | Defaults upon Senior Securities | 31 |
| ITEM 4. | Mine Safety Disclosures | 31 |
| ITEM 5. | Other Information | 32 |
| ITEM 6. | Exhibits | 33 |
| SIGNATURES | 34 | |
Certain Definitions
The following definitions apply throughout this quarterly report unless the context requires otherwise:
| “We”, “Us”, “Company”, “Smart Sand” or “Our” | Smart Sand, Inc., a company organized under the laws of Delaware, and its subsidiaries. |
|---|---|
| “shares”, “stock” | The common stock of Smart Sand, Inc., nominal value $0.001 per share. |
| “ABL Credit Facility”, “ABL Credit Agreement”,“ABL Security Agreement” | The five-year senior secured asset-based lending credit facility (the “ABL Credit Facility”) pursuant to: (i) an ABL Credit Agreement, dated December 13, 2019, between the Company and Jefferies Finance LLC, as amended from time to time (as amended, the “ABL Credit Agreement”); and (ii) a Guarantee and Collateral Agreement, dated December 13, 2019, between the Company and Jefferies Finance LLC, as agent, as amended from time to time (as amended, the “Security Agreement”). |
| “Oakdale Equipment Financing”, “MLA” | The five-year Master Lease Agreement, dated December 13, 2019, between Nexseer Capital (“Nexseer”) and related lease schedules in connection therewith (collectively, the “MLA”). The MLA was structured as a sale-leaseback of substantially all of the equipment at the Company’s mining and processing facility located near Oakdale, Wisconsin. The Oakdale Equipment Financing was considered a lease under article 2A of the Uniform Commercial Code but was considered a financing arrangement (and not a lease) for accounting or financial reporting purposes. The MLA and all schedules were paid and full and terminated on June 28, 2024. |
| “VFI Equipment Financing” | The four-year Master Lease Agreement, dated May 9, 2024, between Varilease Finance, Inc. (“VFI”) and related lease schedule entered into on June 26, 2024 in connection therewith (collectively, the “VFI Equipment Financing”). The VFI Equipment Financing was structured as a sale-leaseback of specific SmartSystemsTM wellsite proppant storage equipment owned by the Company. The VFI Equipment Financing is considered a lease under article 2A of the Uniform Commercial Code but is considered a financing arrangement (and not a lease) for accounting and financial reporting purposes. |
| “Exchange Act” | The Securities Exchange Act of 1934, as amended. |
| “Securities Act” | The Securities Act of 1933, as amended. |
| “FASB”, “ASU”, “ASC”, “GAAP” | Financial Accounting Standards Board, Accounting Standards Update, Accounting Standards Codification, Accounting Principles Generally Accepted in the United States, respectively. |
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