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“We are pleased with the results for the second quarter,” said Gary Kolstad, president and CEO. “The economic success that our clients have experienced when using our highly conductive proppant in both oil and natural gas plays has helped maintain demand at a high level. Although we were able to marginally draw down from our finished goods inventory during the second quarter, we remain capacity constrained, and as mentioned on last quarter’s conference call, we expect proppant sales volumes to track closely with our production capacity over the next several months.
“Construction is progressing well on the third 250 million pound production line at our Toomsboro, Ga., facility, and we still expect this line to commence production in November of this year. We continue to see solid revenue growth in the Falcon Technologies business, and were pleased to have announced an 11% increase in our quarterly dividend, illustrating the board of directors' confidence in the current and future financial strength of the company.”
The company’s worldwide proppant sales volume totaled 314 million pounds for the second quarter of 2010, representing a year-over-year increase of 45%. North American proppant sales volume increased 42% year-over-year, while international proppant sales volume increased 61% compared to the same period last year.
Operating profit for the second quarter of 2010 increased 101%, or $14.5 million, compared to the second quarter of 2009. This increase is due to higher sales volume and an increase in the average proppant selling price, partially offset by an increase in freight costs. Selling, general, administrative and other operating expenses for the second quarter of 2010 increased $3.6 million on a year-over-year basis, largely due to the inclusion of the Falcon Technologies business that was acquired in October 2009 and higher research and development spending.
Net income for the second quarter of 2010 increased 100%, or $9.3 million, compared to the second quarter of 2009.