U.S. Silica Holdings, Inc. (NYSE:SLCA) Q4 2023 Earnings Call Transcript February 27, 2024 8:30 AM ET

Company Participants

Patricia Gil - VP of IR & Sustainability

Bryan Shinn - CEO

Kevin Hough - Interim EVP & CFO

Conference Call Participants

Stephen Gengaro - Stifel

John Daniel - Daniel Energy

Operator

Good morning, and welcome to the U.S. Silica Fourth Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce you to Patricia Gil, Vice President of Investor Relations and Sustainability.

Patricia Gil

Thank you, and good morning, everyone. I'd like to thank you for joining us today for U.S. Silica's fourth quarter 2023 earnings conference call. Leading the call today are Bryan Shinn, our Chief Executive Officer, and Kevin Hough, our Interim Executive Vice President and Chief Financial Officer.

Before we begin, I would like to remind you of our standard cautionary remarks regarding the forward-looking nature of some of the statements that will be made today. Such forward-looking statements, which are predictions, projections, or other statements about future events are based on current expectations and assumptions, which are subject to certain risks and uncertainties. For a complete discussion of these risks and uncertainties, we encourage you to read the company's press release and our documents on file with the SEC. We do not undertake any duty to update any forward-looking statements. Additionally, we have provided a supplemental fourth quarter earnings presentation on our website in the Investors section to accompany today's discussion.

On today's call, we may refer to non-GAAP measures such as adjusted EBITDA, segment contribution margin, net debt, and net leverage ratio. Please refer to today's press release, our public filings, or the accompanying earnings presentation for a full reconciliation and discussion of adjusted EBITDA, segment contribution margin, net debt, and the net leverage ratio.

I would now like to turn the call over to our CEO, Bryan Shinn.

Bryan Shinn

Thanks, Patricia, and good morning, everyone. During the fourth quarter, we continued to strengthen our financial foundation and advance our growth strategy while closing out an exceptionally strong and historic year for the company. During 2023, we delivered on profit guidance with 24% year-over-year adjusted EBITDA growth while increasing company contribution margin 16% and net income 88%. We also generated $264 million of cash flow from operations. These impressive annual results were driven by a combination of strong customer demand and disciplined pricing in oil and gas, and increased pricing and improved product mix in industrials, all supported by our optimized and lean cost structure.