United States Lime & Minerals, Inc. (NASDAQ: USLM) today
reported second quarter 2020 results: The Company’s revenues
in the second quarter 2020 were $37.5 million, compared to $39.0
million in the second quarter 2019, a decrease of $1.4 million, or
3.6%. For the first six months 2020, revenues were $76.0
million, compared to $76.8 million in the first six months 2019, a
decrease of $0.8 million, or 1.0%. The decreases in revenues
in the second quarter and first six months 2020, compared to the
comparable 2019 periods, resulted primarily from reduced sales
volumes of the Company’s lime and limestone products due to
decreased demand, principally from the Company’s oil and gas
services, steel, and environmental customers, partially offset by
increased demand from the Company’s construction customers, which
had been negatively impacted by increased rainfall in Texas in the
second quarter 2019, and an increase in the average selling prices
for the Company’s lime and limestone products in the 2020 periods
compared to the comparable 2019 periods.
The Company’s gross profit was $10.4 million in the second
quarter 2020, compared to $9.7 million in the second quarter 2019,
an increase of $0.6 million, or 6.5%. Gross profit in the
first six months 2020 was $20.2 million, an increase of $1.8
million, or 9.8%, from $18.4 million in the first six months
2019. The increases in gross profit in the 2020 periods,
compared to the comparable 2019 periods, resulted primarily from
lower fuel costs, and increased operating efficiencies associated,
in part, with the new kiln at the Company’s St. Clair facility,
which began producing commercially saleable quicklime in the second
quarter 2019, partially offset by the decreased revenues described
above and increased costs incurred in the second quarter 2020
associated with responding to the COVID-19 pandemic.
Selling, general and administrative (“SG&A”) expenses were
$2.9 million and $6.1 million in the second quarter and first six
months 2020, respectively, compared to $2.6 million and $5.3
million in the second quarter and first six months 2019,
respectively, resulting in increases of $0.2 million, or 9.2%, and
$0.8 million, or 14.8%, respectively. The increases in
SG&A expenses resulted primarily from increased personnel
expenses, including stock-based compensation, increased legal
expenses, including acquisition-related legal fees, and increased
second quarter 2020 COVID-19 pandemic costs.
The Company’s revenues in the second quarter and first six
months 2020 included $185 thousand and $411 thousand, respectively,
from natural gas interests, compared to $373 thousand and $707
thousand in the second quarter and first six months 2019,
respectively. The Company’s gross profit in the second
quarter and first six months 2020 included a loss of $150 thousand
and $312 thousand from natural gas interests, respectively,
compared to income of $37 thousand and $44 thousand in the second
quarter and first six months 2019, respectively. In the
fourth quarter 2019, the Company assessed the recent trends of
revenue, gross profit or loss, and total assets of its natural gas
interests and determined that those interests no longer represented
a reportable segment.
The Company reported net income of $6.1 million ($1.08 per share
diluted) and $11.6 million ($2.07 per share diluted) in the second
quarter and first six months 2020, respectively, compared to $6.0
million ($1.07 per share diluted) and $11.2 million ($1.99 per
share diluted) in the second quarter and first six months 2019,
respectively, increases of $0.1 million, or 1.1%, and $0.5 million,
or 4.3%, respectively.
On July 1, 2020, the Company acquired 100% of the equity
interest of Carthage Crushed Limestone, a limestone mining and
production company located in Carthage, Missouri, for $9 million
cash, subject to adjustment.
Federal, state, and local governmental responses to the COVID-19
pandemic, which include restrictions requiring social distancing
and restrictions on business activities and movement of people in
the markets for the Company’s lime and limestone products, began to
take effect the last two weeks of March 2020. While many of
these restrictions began to be lifted in the second quarter 2020,
the easing of restrictions has subsequently been halted or reversed
in much of the Company’s geographic footprint. The pandemic
and related restrictions on business activities have resulted in a
general economic slowdown, which has disproportionately impacted
certain industries that purchase the Company’s products, including
environmental, oil and gas drilling, and steel. The Company expects
a continued slowdown in economic activity as restrictions continue,
or even expand, which it anticipates will have an adverse impact on
the demand for its lime and limestone products. In addition,
a continued economic slowdown may put downward pressure on the
prices the Company is able to realize for its products.
“We are pleased with our second quarter 2020 results, especially
in light of the challenges presented by the COVID-19
pandemic. We will continue to focus on cost-cutting
initiatives and ways to further increase operating efficiencies to
mitigate some of the decreases in demand resulting from the
pandemic. Also, we are pleased to announce the acquisition of
Carthage Crushed Limestone and believe that this acquisition
complements our existing geographic footprint,” said Timothy W.
Byrne, President and Chief Executive Officer.
“As we focus on our business during these unprecedented times
caused by the COVID-19 pandemic, we remain fully committed to the
safety of our employees and individuals at our facilities that
deliver lime and limestone products to the essential businesses and
communities we serve. In addition to our standard health and safety
protocols, we are continuing the use of enhanced protocols at all
of our locations, including reduced access to facilities, screening
of individuals on all sites, and the enforcement of social
distancing and other practices that are consistent with, or exceed,
the guidelines of the Center for Disease Control and state and
local authorities,” added Mr. Byrne.
Dividend
The Company also announced today that the Board of Directors has
declared a regular quarterly cash dividend of $0.16 per share on
the Company’s common stock. This dividend is payable on September
18, 2020 to shareholders of record at the close of business on
August 28, 2020.
United States Lime & Minerals, Inc., a
NASDAQ-listed public company with headquarters in Dallas, Texas, is
a manufacturer of lime and limestone products, supplying primarily
the construction (including highway, road and building
contractors), industrial (including paper and glass manufacturers),
environmental (including municipal sanitation and water treatment
facilities and flue gas treatment processes), metals (including
steel producers), oil and gas services, roof shingle manufacturers
and agriculture (including poultry and cattle feed producers)
industries. The Company operates lime and limestone plants
and distribution facilities in Arkansas, Colorado, Louisiana,
Missouri, Oklahoma and Texas through its wholly owned subsidiaries,
Arkansas Lime Company, Colorado Lime Company, Texas Lime Company,
U.S. Lime Company, U.S. Lime Company – Shreveport, U.S. Lime
Company – St. Clair, ART Quarry TRS LLC (DBA Carthage Crushed
Limestone) and U.S. Lime Company – Transportation. In
addition, the Company, through its wholly owned subsidiary, U.S.
Lime Company – O & G, LLC, has royalty and non-operating
working interests pursuant to an oil and gas lease and a drillsite
agreement on its Johnson County, Texas property, located in the
Barnett Shale Formation.
Any statements contained in this news release, including, but
not limited to, statements relating to the impact of the COVID-19
pandemic, that are not statements of historical fact are
forward-looking statements as defined in the Private Securities
Litigation Reform Act of 1995. The Company undertakes no
obligation to publicly update or revise any forward-looking
statements, and investors are cautioned that such statements
involve risks and uncertainties that could cause actual results to
differ materially from expectations, including without limitation
those risks and uncertainties indicated from time to time in the
Company’s filings with the Securities and Exchange Commission.
(Tables Follow) United States
Lime &
Minerals, Inc.CONDENSED
CONSOLIDATED FINANCIAL DATA(In
thousands, except per share
amounts)(Unaudited)
|
Three Months Ended |
|
Six Months Ended |
|
June 30, |
|
June 30, |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
INCOME STATEMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
$ |
37,547 |
|
|
$ |
38,954 |
|
|
$ |
75,987 |
|
|
$ |
76,753 |
|
Cost of sales |
|
27,190 |
|
|
|
29,227 |
|
|
|
55,753 |
|
|
|
58,333 |
|
Gross profit |
$ |
10,357 |
|
|
$ |
9,727 |
|
|
$ |
20,234 |
|
|
$ |
18,420 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses |
$ |
2,881 |
|
|
$ |
2,639 |
|
|
$ |
6,100 |
|
|
$ |
5,312 |
|
Operating profit |
$ |
7,476 |
|
|
$ |
7,088 |
|
|
$ |
14,134 |
|
|
$ |
13,108 |
|
Interest expense |
|
62 |
|
|
|
60 |
|
|
|
124 |
|
|
|
122 |
|
Interest and other income,
net |
|
(104 |
) |
|
|
(490 |
) |
|
|
(351 |
) |
|
|
(982 |
) |
Income tax expense |
|
1,417 |
|
|
|
1,485 |
|
|
|
2,716 |
|
|
|
2,807 |
|
Net income |
$ |
6,101 |
|
|
$ |
6,033 |
|
|
$ |
11,645 |
|
|
$ |
11,161 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income per share of common
stock: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
1.08 |
|
|
$ |
1.07 |
|
|
$ |
2.07 |
|
|
$ |
1.99 |
|
Diluted |
$ |
1.08 |
|
|
$ |
1.07 |
|
|
$ |
2.07 |
|
|
$ |
1.99 |
|
Weighted-average shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
5,629 |
|
|
|
5,614 |
|
|
|
5,627 |
|
|
|
5,612 |
|
Diluted |
|
5,637 |
|
|
|
5,624 |
|
|
|
5,636 |
|
|
|
5,619 |
|
Cash dividends per share of
common stock |
$ |
0.160 |
|
|
$ |
0.135 |
|
|
$ |
0.320 |
|
|
$ |
0.270 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
December 31, |
|
|
|
|
|
|
|
2020 |
|
2019 |
BALANCE
SHEETS |
|
|
|
|
|
|
|
|
|
|
|
Assets: |
|
|
|
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
$ |
105,692 |
|
|
$ |
92,735 |
|
Property, plant and equipment, net |
|
|
|
|
|
|
|
150,660 |
|
|
|
150,687 |
|
Other non-current assets |
|
|
|
|
|
|
|
2,918 |
|
|
|
3,615 |
|
Total assets |
|
|
|
|
|
|
$ |
259,270 |
|
|
$ |
247,037 |
|
Liabilities and Stockholders’
Equity: |
|
|
|
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
$ |
9,224 |
|
|
$ |
9,459 |
|
Deferred tax liabilities, net |
|
|
|
|
|
|
|
19,692 |
|
|
|
17,218 |
|
Other long-term liabilities |
|
|
|
|
|
|
|
2,735 |
|
|
|
3,228 |
|
Stockholders’ equity |
|
|
|
|
|
|
|
227,619 |
|
|
|
217,132 |
|
Total liabilities and stockholders’ equity |
|
|
|
|
|
|
$ |
259,270 |
|
|
$ |
247,037 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contact: Timothy W. Byrne(972) 991-8400
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