SOI's mobile proppant management systems unload, store and deliver proppant at oil & gas well sites. Its systems improve the efficiency of proppant logistics for its customers, which are primarily oil & gas drillers. Since commencing operations in April 2014, SOI has grown its fleet from two systems to 37 systems. Frac sand (proppant) is used by drillers to help extract oil & gas from the well. Frac sand is mixed with high volumes of water and chemicals and forced into the shale, where it holds open fissures allowing the oil or gas to be extracted.
Its systems are deployed in many of the most active oil & gas basins in the US, including the Permian Basin, the Eagle Ford Shale and the SCOOP/STACK formation. Customers include oil & gas exploration companies such as EOG Resources, Devon Energy and Apache, as well as oilfield service companies, such as ProPetro Services.
SOI’s patented systems typically provide 2.5 mln pounds of proppant storage capacity in a footprint that is considerably smaller than traditional well site proppant storage equipment. Solaris' six-silo system contains 3x the on-site sand storage capacity in half the space of a conventional SandKing system. SOI’s systems have the ability to unload up to 24 pneumatic proppant trailers simultaneously.
Its proppant storage silos can be filled from trucks while simultaneously delivering proppant on-demand directly to the blender for hydraulic fracturing operations. As such, SOI’s systems can maintain high rates of proppant delivery for extended periods of time, which helps achieve a greater number of frac stages per day, driving a reduction in our customers' costs. Its systems also reduce the amount of truck demurrage (wait time) at the well site which can result in significant cost savings.
Turning to the financials, the company is profitable on a GAAP basis but reported a 2016 loss on a pro forma basis. 2016 revenue came in at $18.16 million, up 28% from $14.2 million in 2015. It has pretty good operating margin, which came in at 15.8% in 2016 vs an operating loss in 2015. Adjusted EBITDA in 2016 came in at $6.79 mln, which computes as a 37.4% margin, up from 11.7% in 2015.