NiSource Inc T.NI

Primary Symbol: NI

Utilities Utilities - Diversified

NiSource Inc. is an energy holding company. The Company operates through two segments: Gas Distribution Operations and Electric Operations. The Gas Distribution operations segment, through its wholly owned subsidiary NiSource Gas Distribution Group, Inc., provides natural gas to approximately 2.4 million residential, commercial and industrial customers in Ohio, Pennsylvania, Virginia, Kentucky, and Maryland. It operates approximately 55,000 miles of distribution main pipeline plus the associated individual customer service lines and 1,000 miles of transmission main pipeline located in its service areas. The Electric Operations segment generates, transmits and distributes electricity through its subsidiary NIPSCO to approximately 0.5 million customers in 20 counties in the northern part of Indiana and is also engaged in wholesale electricity and transmission transactions. It has four owned projects: Rosewater, Indiana Crossroads Wind, Indiana Crossroads Solar, and Dunns Bridge I.

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NiSource Inc

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Post by aggmanon Nov 02, 2014 3:56am

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Post# 23085954

US Silica Q3 (SLCA)

Key Takes:

Step change in demand - "no reduction in demand"
All market trends drive sales higher
SOLD OUT in all products for the foreseeable future
Supply & Demand remains tight
pricing improvement (record $31.33 contribution margin per ton - in oil and gas segment)
- improvement split: 1/3 price, 1/3 mix, 1/3 cost improvement
70% capacity is under long term contracts with customers
Rail car count: currently 6,500; end-2014 7,000, end-2015 9,000
+8M tons of new capacity over next 8 quarters
Credit rating upgrade
EBITDA guidance - now at upper end of guidance
- Q4; conservative around Q4 (weather) - seasonality in industrial business
- more upside in guidance if December is not harsh
Pricing: seeing some price increases
Market demand: +25%-30% (15 v 14) - if oil at $80; moderate pull back if oil at $70 (growth YoY) +20%-25%
Not seeing any slow down - nothing. Customers are seeking US Silica out and want more volume - speaks to US Silica's attributes (excellent service, logistics)
increasingly tougher to find sites and permit them.
increasingly this is becoming a logistics business- competence to deliver sand to basins
continue to have contract opportunities
on consolidation: would expect to see and increasing chorus of acquisition opportunities - and that SLCA will be eager and active in viewing the consolidation activities
Expansion in northern white sand side - profitable
US frac sand demand in 2014 is 58M tons
Analyst question: Who in the industry gets hurt first - in a down turn?
- look at cost curve - highest cost 20%
- logistics footprint - critical
- unit train - important (as this represents cost efficiency)
- contracts - strong contracts (majors - not highly leveraged small cap players - who also get served by higher cost sand producers
- So US Silica is less sensisitve (because of its position) to a 30% downturn in demand
- they don't reveal - profit demand by basin
- however: big 4 US basins: Permean, Bakkan, Marcelleus, Eagleford - where most of the rigs are - where most of the profitability is
- Point of sales is being moved closer to the well; velocity of material and sale is increasingly important