CONFIDENTIAL May 18, 2017 Smart Sand, Inc. Houlihan Lokey 2017 Global Industrials Conference
Smart Sand Key Highlights Long-lived, strategically located, high-quality reserve base Intrinsic logistics advantage Significant organic growth potential Focus on safety and environmental stewardship Experienced…
Smart Sand Company Overview Company Overview Reserve Locations Smart Sand is a pure-play, low-cost producer of high-quality Oakdale, WI 1,196 acres Northern White raw frac sand (Monroe County, WI) The Company owns and operates a…
Summary of Smart Sands Strategic Assets Oakdale (Existing Operation) Hixton (Potential Future Development) Location Monroe County, WI Jackson County, WI Mine Processing Facility Rail Loading Facility Rail Access Served…
Oakdale Facility: High Quality Northern White Raw Frac Sand 1,196 contiguous acres with 332 million tons of proven reserves(1) As of December 31, 2016, we have utilized 135 acres for facilities and mining operations, only 11.3% of…
Cost-Effective, Differentiated Process Onsite Mining / Excavation Conveyer Belt to Onsite Wet Plant Wet Plant Cleans and Sorts Dry Plant Dries and Sorts Product Unit Trains Deliver Dry Sand to Basin Low cost operating…
Expansive Logistics Capabilities Key Logistical Advantages Highly Competitive Delivery Capabilities On-site rail eliminates trucking to a rail load-out facility and associated costs Class I access current location on Canadian Pacific…
Significant Organic Growth Potential UP Rail Siding (Byron, WI) Commenced operations in June 2016 Dual-serve rail origination capability at Oakdale Expanding to be a unit-train capable facility by end of Q3 2017 Expected to result…
Hixton Facility Opportunity Hixton Site Highlights Hixton Reserve Mix In addition to our Oakdale facility, we own a second site comprising 959 acres in Jackson County, Wisconsin 100 Mesh situated adjacent to a Class I rail line, the…
Committed to Highest Corporate Standards Management maintains close dialogue with its customers regarding the oil and gas industrys rigorous regulatory environment Legal & ISO registered Quality System and Environmental Management…
Our Strategy Focusing on increasing capacity utilization and processing capacity Continue to position ourselves as a pure play producer of high-quality Northern White raw frac sand Continue to evaluate economically attractive facility…
INDUSTRY OVERVIEW
Industry Trends Driving Growth in Sand Demand Average Active U.S. Rig Count U.S. Horizontal vs. Vertical Well Mix 2,000 100% 30000 1,862 80% 37% 37% 38% 40% 41% 25000 1,500 1,762 49% 44% 1,180 55% 20000 983 1,079 60% 870 1,000 708…
Market Growth Potential Jefferies U.S. Land Framework 2016 Average 2017 Average 2018 Average 2014 Peak Rig Count 484 (-48% y/y) t 825 (+70% y/y) t 1,120 (+36% y/y) t 1,789 Ave Rigs % HZ Rigs 83% (+344 bps y/y) 82% (-35 bps y/y)…
Proppant Industry Outlook Total Market Proppant Demand 25,000 23,674 140 125 20,236 120 113 20,000 Millions of tons of Proppant 16,860 100 New US Horizontal Wells 16,029 85 15,755 15,000 80 12,656 65 74 10,520…
Raw Sand Established as Proppant of Choice Comparison of Key Proppant Characteristics Brown Raw Frac Sand Northern White Raw Frac Sand Resin-coated Ceramics Product and Natural resource Natural resource Raw frac sand substrate with…
Growing Demand for Fine Sand Mesh Sizes Market Outlook for Fine Sand Proppant size is characterized by mesh size which is According to Kelrik LLC, a notable driver impacting determined by sieving the proppant through mesh demand for…
Financial Highlights Significant balance sheet flexibility and liquidity post IPO and February 2017 equity offering Minimal debt Approximately 70 million in cash available to support growth initiatives Minimal unused railcar…
APPENDIX
Income Statement For the Year ended Year ended Year ended Three m onths ended Dec 31, 2014 Dec 31, 2015 Dec 31, 2016 Mar 31, 2017 ( in millio ns) (Audited) (Audited) (Audited) (Unaudited) Revenues (1) 68.2 47.7 59.2 25.1 Cost of…
Balance Sheet As of Decem ber 31, 2014 Decem ber 31, 2015 Decem ber 31, 2016 March 31, 2017 ( in millio ns) (Audited) (Audited) (Audited) (Unaudited) Current assets Cash and cash equivalents 0.8 3.9 46.6 73.6 Accounts receivable 8.6…
Statement of Cash Flows For the Year ended Year ended Year ended Three m onths ended Decem ber 31, 2014 Decem ber 31, 2015 Decem ber 31, 2016 March 31, 2017 ( in millions) (Audited) (Audited) (Audited) (Unaudited) Operating…
EBITDA Reconciliation Three m onths Year ended Decem ber 31, ended March 31, ( in tho usands) 2014 2015 2016 2017 Net income (loss) 7,556 4,990 10,379 969 Depreciation, depletion, accretion and amortization 3,642 5,318 6,445 1,667…
Production Cost Reconciliation Three m onths ended Year ended Decem ber 31, March 31, ( in thousands) 2014 2015 2016 2017 Cost of goods sold 29,934 21,003 26,569 19,662 Depreciation, depletion, and accretion of asset retirment…
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