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Solaris Energy Infrastructure, Inc.(SEI) - 2025 Q1 - Quarterly Results
SEISolaris Energy Infrastructure, Inc.(SEI)2025-04-03 21:14

Acquisition Details - Solaris Energy Infrastructure, Inc. completed the acquisition of Mobile Energy Rental LLC for a total consideration of 136.7million,whichincludes136.7 million, which includes 60 million in cash and 16,464,778 units of Solaris LLC[2]. - Solaris incurred 162millionofadditionaldebttorefinanceexistingdebtandfundthecashdueatclosingofthetransaction[3].−Theacquisitionmethodofaccountingwasused,withassetsandliabilitiesrecordedattheirfairvaluesasoftheacquisitiondate[3].−Thetransactionissubjecttoclosingadjustmentsthathavenotyetbeenfinalized,indicatingpotentialvariabilityinthefinalaccounting[8].−Thetransactionwillincreasenon−controllinginterestby162 million of additional debt to refinance existing debt and fund the cash due at closing of the transaction[3]. - The acquisition method of accounting was used, with assets and liabilities recorded at their fair values as of the acquisition date[3]. - The transaction is subject to closing adjustments that have not yet been finalized, indicating potential variability in the final accounting[8]. - The transaction will increase non-controlling interest by 1.5 million due to the issuance of 16.5 million Solaris LLC units to MER members[30]. Financial Projections - The pro forma combined total revenue for the year ended December 31, 2024, is projected to be 339.033million,reflectinganincreasefromhistoricalrevenues[11].−Totaloperatingcostsandexpensesfortheproformacombinedentityareprojectedtobe339.033 million, reflecting an increase from historical revenues[11]. - Total operating costs and expenses for the pro forma combined entity are projected to be 295.378 million, resulting in an operating income of 43.655million[11].−ThetransactionisexpectedtoenhanceSolaris′sserviceandleasingrevenue,withservicerevenueprojectedat43.655 million[11]. - The transaction is expected to enhance Solaris's service and leasing revenue, with service revenue projected at 264.260 million and leasing revenue at 60.141million[11].−TotalrevenuesfortheproformayearendedDecember31,2024areprojectedtobe60.141 million[11]. - Total revenues for the pro forma year ended December 31, 2024 are projected to be 23,721 thousand, with lease income contributing 7,821thousandandservicerevenueat7,821 thousand and service revenue at 2,103 thousand[20]. - Net income for the pro forma year ended December 31, 2024 is estimated at 12,930thousand,reflectingasignificantincreasefromhistoricalperformance[20].EarningsandExpenses−Theproformacombinednetincomeattributabletocommonshareholdersisestimatedat12,930 thousand, reflecting a significant increase from historical performance[20]. Earnings and Expenses - The pro forma combined net income attributable to common shareholders is estimated at 6.246 million, with earnings per share of 0.22onadilutedbasis[11].−ProformaearningspershareforClassAcommonstockareprojectedat0.22 on a diluted basis[11]. - Pro forma earnings per share for Class A common stock are projected at 0.22 (basic) and 0.21(diluted)fortheyearendedDecember31,2024[32].−Theprovisionforincometaxesisestimatedat0.21 (diluted) for the year ended December 31, 2024[32]. - The provision for income taxes is estimated at 5.7 million for the year ended December 31, 2024, based on a historical effective tax rate of 20.2%[29]. - The pro forma adjustment to interest expense for the year ended December 31, 2024 is estimated to be a net reduction of 5,442thousand,withavariableinterestrateassumedat10.85,442 thousand, with a variable interest rate assumed at 10.8%[24]. - The company anticipates an additional pro forma depreciation and amortization expense of 8,422 thousand related to the acquisition of identifiable property and equipment[26]. Management Insights - Solaris's management believes the pro forma financial statements reflect necessary adjustments to present fairly the combined financial information[6]. - The pro forma adjustments are preliminary and may change as additional information becomes available, potentially impacting the financial statements materially[8]. - The pro forma adjustments include the elimination of historical interest expenses totaling $12,820 thousand, enhancing the overall financial outlook[24]. - The company expects to depreciate equipment held for lease once delivered, with significant investments in "Construction in Progress" for turbines and other equipment[28].