Hi-Crush Partners LP (NYSE:HCLP) reported that the Board of its general partner has announced a quarterly cash payment of $0.15 per unit, or $0.60 on a yearly basis, for the Q3 2017. Separately, the Board also permitted a unit buyback plan of up to $100 million.
Laura Fulton, the Chief Financial Officer of Hi-Crush, reported that the stabilization of market conditions, together with robust demand for logistics and frac sand services has benefited their business. They wisely expanded their operational capabilities and geographic reach in anticipation to continued strong consumer demand, and their cash flow and volumes have improved markedly. Keeping this in mind, their management, together with the Board of Directors, decided that the timing was opportune to restart capital return to unitholders and achieve so in two different ways.
Preliminary, by reinstating cash quarterly payments to unitholders, effective starting the third quarter, payable in the Q4 2017. And next, by pursuing a resourceful unit buyback on the open market of up to $100 million as approved by their Board.
The buyback approval is effective immediately, and the plan will continue until otherwise terminated or modified by the Board in its sole will and without notice. The association has authority at this time as per its Term Loan and Revolving Credit Deal for repurchases of up to $20 million which, in the coming period and combined with the preliminary quarterly distribution and its anticipated growth, is well-aligned with company’s capital return intentions.
The association will seek consent permitting for the authorized sum of up to $100 million. HI-Crush reported that the buyback plan does not obligate the association to repurchase any specific dollar sum or number of units and may be discontinued or suspended at any time.
In the last trading session, the stock price of Hi-Crush jumped more than 7% to close the day at $9.65.
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