Smart Sand’s Bakken ops drive Q3 growth, share repurchase

By Luke Geiver | November 12, 2018

Frack sand demand from clients in the Bakken has helped propel Smart Sand Inc. to another strong quarter. The Texas-based sand supplier reported a 97 percent increase at its Van Hook, North Dakota, sand transload facility after the company went live with the revamped facility earlier this year.

For Q3, the company reported a 16 percent increase in revenue, bringing in $63.1 million despite a slowdown in frack activity at the end of the quarter.

Smart Sand has joined a growing list of sand-related firms that are now offering mine to wellsite services. In June, the company acquired Quickthree Solutions, a manufacturer of portable vertical frack sand storage solutions for the wellsite. Starting at the end of the year, Smart Sand will have an operating fleet of sand silos that can store sand on the well pad. Smart Sand sources its sand from an Oakdale, Wisconsin, mine that produces northern white sand.

After seeing the success of its Van Hook terminal in the Bakken, Charles Young, CEO said the company would like to reduplicate its success in other shale plays. “We are looking to replicate this in other basins, particularly the Marcellus,” he said. “We believe the benefits of our long-term growth strategy for in-basin sand delivery of sand are new contracted customers, increased spot sales, incremental margin from logistics services and increased opportunities to market our wellsite storage solutions.”

In addition to its successful roll-out of its sand storage fleet and growth in the Bakken, the company’s board of directors believes Smart Sand’s stock price is undervalued. “We believe the current share price doesn’t accurately reflect Smart Sand’s present value or its long-term growth potential. Therefore, repurchasing the company’s shares now represents an excellent investment opportunity for both the company and our shareholders.”