CARBO Ceramics Inc. recently reported a GAAP net loss of $13.9 million, or a loss of $0.60 per share, on revenues of $75.8 million for the quarter ended September 30, 2015. This net loss includes $3.6 million, or $0.15 per share, of after-tax costs associated with slowing and idling production and $2.3 million, or $0.10 per share in miscellaneous after-tax charges.

“The industry environment remains extremely challenging, but we continued to grow the number of clients using our production enhancement technologies, despite being in an environment where E&P operators are focused on a reduction of cash spend,” said Gary Kolstad, CEO. “KRYPTOSPHERE® HD and SCALEGUARD® technologies were again successfully employed in the ultra-deep Lower Tertiary formation in the Gulf of Mexico during the quarter. In addition, our total ceramic proppant sales volumes increased 24% sequentially, while imports of low-quality Chinese ceramic proppant remained very low. Clients using our Design, Build, and Optimize the Frac® platform continue to experience success in their production results. This platform allows our clients to configure a customized solution for their reservoir, increase well production and estimated ultimate recovery (EUR), and lower finding and development costs.”

Revenues for the third quarter of 2015 decreased 51%, or $79.6 million, compared to the third quarter of 2014. The decrease was mainly attributable to a decrease in proppant sales volumes and market-driven reductions in the average selling prices.

Operating loss for the third quarter of 2015 was $19.2 million, compared to an operating profit of $19.0 million in the third quarter of 2014. The decrease was mainly attributable to the decrease in ceramic proppant sales volumes and a decrease in average ceramic proppant selling price. In addition, the company expensed $5.5 million in unabsorbed production costs as a result of low production levels and idled facilities. Operating loss was further impacted by $1.7 million in severance costs and a $1.7 million loss on derivative instruments. The impact of these items was partially offset by SG&A cost-cutting measures implemented in early 2015 and throughout the year. In addition, the company recorded a $5.0 million impairment of long-lived assets and a $2.8 million inventory adjustment during the third quarter of 2014, which did not reoccur during the third quarter of 2015. Net loss for the third quarter of 2015 was $13.9 million, compared to net income of $13.7 million in the third quarter of 2014.

“The oil and gas industry remains severely depressed,” said Kolstad. “Recent evidence points to E&P operators substantially reducing completion activity in the fourth quarter of 2015. As a result, our proppant sales volumes in the fourth quarter of 2015 will likely decline significantly when compared to the third quarter of 2015. In addition, we expect to see continued pricing pressure in the fourth quarter of 2015.”

For additional information, visit www.carboceramics.com.