Document and Entity Information
Document and Entity Information - $ / shares | 9 Months Ended | |
Sep. 30, 2023 | Oct. 30, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Central Index Key | 0001984060 | |
Document Fiscal Period Focus | Q3 | |
Document Period End Date | Sep. 30, 2023 | |
Document Fiscal Year Focus | 2023 | |
Securities Act File Number | 001-41828 | |
Entity Registrant Name | Atlas Energy Solutions Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 5918 W. Courtyard Drive | |
Entity Address, Address Line Two | Suite 500 | |
Entity Address, City or Town | Austin | |
Entity Address, State or Province | TX | |
Entity Tax Identification Number | 93-2154509 | |
Entity Address, Postal Zip Code | 78730 | |
City Area Code | 512 | |
Local Phone Number | 220-1200 | |
Title of 12(b) Security | Class A common stock, par value $0.01 per share | |
Trading Symbol | AESI | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 100,025,584 | |
Entity Listing, Par Value Per Share | $ 0.01 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 264,538 | $ 82,010 |
Accounts receivable | 102,234 | 73,341 |
Inventories | 3,961 | 5,614 |
Spare part inventories | 14,911 | 10,797 |
Prepaid expenses and other current assets | 15,880 | 5,918 |
Total current assets | 401,524 | 178,731 |
Property, plant and equipment, net | 828,997 | 541,524 |
Finance lease right-of-use assets | 496 | 19,173 |
Operating lease right-of-use assets | 3,960 | 4,049 |
Other long-term assets | 4,294 | 7,522 |
Total assets | 1,239,271 | 750,999 |
Current liabilities: | ||
Accounts payable | 57,520 | 31,645 |
Accrued liabilities | 38,836 | 30,630 |
Current portion of long-term debt | 0 | 20,586 |
Other current liabilities | 3,956 | 5,659 |
Total current liabilities | 100,559 | 88,674 |
Long-term debt, net of discount and deferred financing costs | 172,511 | 126,588 |
Deferred tax liabilities | 48,679 | 1,906 |
Other long-term liabilities | 6,363 | 22,474 |
Total liabilities | 328,112 | 239,642 |
Commitments and contingencies (Note 7) | ||
Redeemable noncontrolling interest | 987,151 | 0 |
Stockholders' / members' equity: | ||
Members' Capital | 0 | 511,357 |
Preferred stock | 0 | 0 |
Additional paid-in-capital | 0 | 0 |
Accumulated deficit | (76,992) | 0 |
Total stockholders' and members' equity | (75,992) | 511,357 |
Total liabilities, redeemable noncontrolling interest and stockholders' and members' equity | 1,239,271 | 750,999 |
Related Party [Member] | ||
Current assets: | ||
Accounts receivable - related parties | 0 | 1,051 |
Current liabilities: | ||
Accounts payable - related parties | 247 | 154 |
Common Class A [Member] | ||
Stockholders' / members' equity: | ||
Common stock | 577 | 0 |
Common Class B [Member] | ||
Stockholders' / members' equity: | ||
Common stock | $ 423 | $ 0 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) | Sep. 30, 2023 $ / shares shares |
Preferred stock, par value | $ / shares | $ 0.01 |
Preferred stock, shares authorized | 500,000,000 |
Preferred stock, shares issued | 0 |
Preferred stock, shares outstanding | 0 |
Common Class A [Member] | |
Common stock, par value | $ / shares | $ 0.01 |
Common stock, shares authorized | 1,000,000,000 |
Common stock, shares issued | 57,767,399 |
Common stock, shares outstanding | 57,767,399 |
Common Class B [Member] | |
Common stock, par value | $ / shares | $ 0.01 |
Common stock, shares authorized | 500,000,000 |
Common stock, shares issued | 42,258,185 |
Common stock, shares outstanding | 42,258,185 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Total sales | $ 157,616 | $ 141,682 | $ 472,822 | $ 332,859 |
Operating expenses: | ||||
GrossProfit | 79,625 | 74,408 | 250,820 | 181,519 |
Cost of sales (excluding depreciation, depletion and accretion expense) | 67,770 | 60,138 | 193,829 | 131,633 |
Depreciation, depletion and accretion expense | 10,221 | 7,136 | 28,173 | 19,707 |
Selling, general and administrative expense | 14,301 | 5,774 | 34,988 | 16,414 |
Operating income | 65,324 | 68,634 | 215,832 | 165,105 |
Interest expense, net | (1,496) | (3,876) | (5,459) | (11,770) |
Other income | 136 | 902 | 438 | 2,510 |
Income before income taxes | 63,964 | 65,660 | 210,811 | 155,845 |
Income tax expense | 7,637 | 604 | 20,368 | 1,422 |
Net income | 56,327 | 65,056 | 190,443 | 154,423 |
Less: Pre-IPO net income attributable to Atlas Sand Company, LLC | 0 | 54,561 | ||
Less: Net income attributable to redeemable noncontrolling interest | 26,887 | 66,190 | ||
Net income attributable to Atlas Energy Solutions, Inc. | $ 29,440 | $ 69,692 | 154,423 | |
Earnings Per Share, Basic [Abstract] | ||||
Earnings Per Share, Basic | $ 0.51 | $ 1.22 | ||
Earnings Per Share, Diluted | $ 0.51 | $ 1.21 | ||
Weighted Average Number of Shares Outstanding, Basic | 57,237 | 57,189 | ||
Weighted Average Number of Shares Outstanding, Diluted | 57,928 | 57,746 | ||
Product [Member] | ||||
Total sales | $ 114,773 | 119,222 | $ 368,131 | 286,565 |
Service [Member] | ||||
Total sales | $ 42,843 | $ 22,460 | $ 104,691 | $ 46,294 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||||
Stock and unit-based expense | $ 1,414 | $ 160 | $ 3,660 | $ 543 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' and Members' Equity and Redeemable Noncontrolling Interest (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Prior to Initial Public Offering and Reorganization [Member] | After Initial Public Offering and Reorganization [Member] | Common Stock [Member] Common Class A [Member] | Common Stock [Member] Common Class B [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Deficit [Member] After Initial Public Offering and Reorganization [Member] | Members' Equity [Member] | Members' Equity [Member] Prior to Initial Public Offering and Reorganization [Member] | |
Beginning Balance at Dec. 31, 2021 | $ 338,697 | $ 338,697 | |||||||||
Unit-based compensation expense | 543 | 543 | |||||||||
Net income | 154,423 | 154,423 | |||||||||
Member Distributions | (30,024) | (30,024) | |||||||||
Ending Balance at Sep. 30, 2022 | 463,639 | 463,639 | |||||||||
Redeemable noncontrolling interest, Beginning balance at Dec. 31, 2022 | 0 | ||||||||||
Beginning Balance at Dec. 31, 2022 | 511,357 | 511,357 | |||||||||
Member distributions | (15,000) | (15,000) | |||||||||
Net income | 69,692 | $ 54,561 | $ 69,692 | $ 69,692 | $ 54,561 | ||||||
Effect of reorganization and reclassification to redeemable noncontrolling interest (Note 1) | 771,345 | ||||||||||
Effect of reorganization and reclassification to redeemable noncontrolling interest (Note 1), Shares | 39,148 | 42,852 | |||||||||
Effect of reorganization and reclassification to redeemable noncontrolling interest (Note 1) | (771,345) | $ 391 | $ 429 | $ (221,247) | (550,918) | ||||||
Issuance of common stock in IPO, net of offering costs, Shares | 18,000 | ||||||||||
Issuance of common stock in IPO, net of offering costs | 291,236 | $ 180 | 291,056 | ||||||||
Deferred tax liability arising from the IPO | (27,537) | (27,537) | |||||||||
Stock-based compensation | 3,290 | 3,290 | |||||||||
Net income after IPO and reorganization, Redeemable noncontrolling interest | 66,190 | ||||||||||
$0.35/share Class A common stock dividend | (20,002) | $ (20,002) | |||||||||
$0.35/unit distribution to Atlas Sand Operating, LLC unitholders | (14,998) | ||||||||||
Dividend equivalent rights ($0.35 per share) | (296) | (296) | |||||||||
Other distributions to redeemable non-controlling interest unitholders | (7,158) | ||||||||||
Redemption of operating units of Atlas Sand Operating, LLC for Class A common stock, Shares | 594 | (594) | |||||||||
Redemption of operating units of Atlas Sand Operating, LLC for Class A common stock | 13,640 | $ 6 | $ (6) | 13,640 | |||||||
Redemption of operating units of Atlas Sand Operating, LLC for Class A common stock redeemable noncontrolling interest | (13,640) | ||||||||||
Deferred tax asset arising from the redemption of operating units of Atlas Sand Operating, LLC for Class A common stock | 176 | 176 | |||||||||
Issuance of common stock upon vesting of RSUs, net of shares withheld for income taxes, shares | 25 | ||||||||||
Adjustment of redeemable noncontrolling interests to redemption amount | 185,412 | ||||||||||
Adjustment of redeemable noncontrolling interest to redemption amount | (185,412) | $ (59,026) | (126,386) | ||||||||
Ending Balance at Sep. 30, 2023 | (75,992) | $ 577 | $ 423 | (76,992) | 0 | ||||||
Ending Balance, Shares at Sep. 30, 2023 | 57,767 | 42,258 | |||||||||
Redeemable noncontrolling interest, Ending balance at Sep. 30, 2023 | 987,151 | ||||||||||
Redeemable noncontrolling interest, Beginning balance at Mar. 13, 2023 | [1] | 771,345 | |||||||||
Net income after IPO and reorganization, Redeemable noncontrolling interest | $ 66,190 | ||||||||||
$0.35/unit distribution to Atlas Sand Operating, LLC unitholders | (14,998) | ||||||||||
Redemption of operating units of Atlas Sand Operating, LLC for Class A common stock | (13,640) | ||||||||||
Redemption of operating units of Atlas Sand Operating, LLC for Class A common stock redeemable noncontrolling interest | (7,158) | ||||||||||
Adjustment of redeemable noncontrolling interest to redemption amount | [2] | 185,412 | |||||||||
Ending Balance at Sep. 30, 2023 | (75,992) | $ 577 | $ 423 | $ (76,992) | $ 0 | ||||||
Ending Balance, Shares at Sep. 30, 2023 | 57,767 | 42,258 | |||||||||
Redeemable noncontrolling interest, Ending balance at Sep. 30, 2023 | $ 987,151 | ||||||||||
[1] Based on the Operating Units held by the Legacy Owners who also held 42,852,499 shares of Old Atlas Class B common stock and an Old Atlas Class A common stock price of $ 18.00 on the date on which we consummated the IPO. Based on the Operating Units held by the Legacy Owners who also held 42,258,185 shares of Old Atlas Class B common stock and an Old Atlas Class A common stock 10-day volume-weighted average closing price of $ 23.36 on September 30, 2023. In connection with the Up-C Simplification, each Operating Unit issued and outstanding immediately prior to the Effective Time, other than Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock, and the holders of such Operating Units became stockholders of New Atlas, and all of the Old Atlas Class B common stock issued and outstanding immediately prior to the Effective Time were surrendered and cancelled for no consideration. See Note 8 – Stockholders Equity – Up-C Simplification for more information. |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Stockholders' and Members' Equity and Redeemable Noncontrolling Interest (Unaudited) (Parenthetical) | 9 Months Ended |
Sep. 30, 2023 $ / shares | |
Statement of Stockholders' Equity [Abstract] | |
Dividends declared (in dollars per share) | $ 0.35 |
Unit distribution to unit holders (in dollars per share) | 0.35 |
Dividend equivalent rights (in dollars per share) | $ 0.35 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Operating activities: | ||
Net income | $ 190,443 | $ 154,423 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation, depletion and accretion expense | 29,368 | 20,528 |
Amortization of debt discount | 469 | 338 |
Amortization of deferred financing costs | 270 | 332 |
Stock and unit-based compensation | 3,660 | 543 |
Deferred income tax | 19,059 | 0 |
Commodity derivatives gain | 0 | (1,857) |
Settlements on commodity derivatives | 0 | 1,996 |
Other | 143 | 61 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (28,893) | (43,144) |
Accounts receivable - related party | 868 | 90 |
Inventories | 1,653 | (481) |
Spare part inventories | (4,141) | (3,333) |
Prepaid expenses and other current assets | (10,355) | 1,205 |
Other long-term assets | (1,681) | (5,150) |
Accounts payable | 3,877 | 7,301 |
Accounts payable - related parties | 93 | (433) |
Deferred revenue | 0 | 6,703 |
Accrued liabilities and other liabilities | 8,691 | 16,878 |
Net cash provided by operating activities | 213,524 | 156,000 |
Investing activities: | ||
Purchases of property, plant and equipment | (245,693) | (54,164) |
Net cash used in investing activities | (245,693) | (54,164) |
Financing Activities: | ||
Net proceeds from IPO | 303,426 | 0 |
Payment of offering costs | (6,020) | 0 |
Member distributions prior to IPO | (15,000) | (30,024) |
Principal payments on term loan borrowings | (16,573) | (20,557) |
Prepayment fee on 2021 Term Loan Credit Facility | (2,649) | 0 |
Issuance costs associated with debt financing | (4,397) | (233) |
Payments under finance leases | (1,932) | (703) |
Dividends paid to Class A common stockholders | (20,002) | 0 |
Distributions paid to Atlas Sand Operating, LLC unitholders | (22,156) | 0 |
Net cash provided by (used in) financing activities | 214,697 | (51,517) |
Net increase in cash and cash equivalents | 182,528 | 50,319 |
Cash and cash equivalents, beginning of period | 82,010 | 40,401 |
Cash and cash equivalents, end of period | 264,538 | 90,720 |
Supplemental cash flow information | ||
Interest | 10,735 | 11,140 |
Taxes | 11,403 | 468 |
Supplemental disclosure of non-cash investing activities: | ||
Property, plant and equipment in accounts payable and accrued liabilities | 46,710 | 17,268 |
Redeemable Noncontrolling Interest Cumulative Adjustment to Redemption Value | 185,412 | 0 |
Finance lease assets acquired through debt | 39,454 | 0 |
Finance lease liabilities converted to debt | $ 42,795 | $ 0 |
Business and Organization
Business and Organization | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Organization | Note 1 – Business and Organization Atlas Energy Solutions Inc. (f/k/a New Atlas HoldCo. Inc.) (“New Atlas” and together with its subsidiaries “we,” “us,” “our,” or the “Company”) was formed on June 28, 2023, pursuant to the laws of the State of Delaware, and is the successor to AESI Holdings Inc. (f/k/a Atlas Energy Solutions Inc.), a Delaware corporation (“Old Atlas”). New Atlas is a holding corporation and the ultimate parent company of Atlas Sand Company, LLC (“Atlas LLC”), a Delaware limited liability company formed on April 20, 2017. Atlas LLC is a producer of high-quality, locally sourced 100 mesh and 40/70 sand used as a proppant during the well completion process. Proppant is necessary to facilitate the recovery of hydrocarbons from oil and natural gas wells. One hundred percent of Atlas LLC’s sand reserves are located in Winkler and Ward Counties, Texas, within the Permian Basin and operations consist of proppant production and processing facilities, including one facility near Kermit, Texas (the “Kermit facility”), a second facility under development at the Kermit location, and a third facility near Monahans, Texas (the “Monahans facility”). We are currently building a logistics platform with the goal of increasing the efficiency, safety and sustainability of the oil and natural gas industry within the Permian Basin. This will include the Dune Express, an overland conveyor infrastructure solution currently under construction, coupled with our growing fleet of fit-for-purpose trucks and trailers. We sell products and services primarily to oil and natural gas exploration and production companies and oilfield services companies primarily under supply agreements and also through spot sales on the open market. Initial Public Offering On March 13, 2023, Old Atlas completed its initial public offering (the “IPO”) of 18,000,000 shares of Class A common stock, par value $ 0.01 per share (the “Old Atlas Class A common stock”) at a price of $ 18.00 per share. The IPO generated $ 324.0 million of gross proceeds and net proceeds of approximately $ 291.2 million. The gross proceeds were offset by $ 20.6 m illion of underwriting discounts and commissions, $ 5.9 mi llion of current offering costs in 2023, an d $ 6.3 million in offer ing costs paid in 2022 that were recorded to other long-term assets on the consolidated balance sheets as of December 31, 2022. The material terms of the IPO are described in Old Atlas’s final prospectus, dated March 8, 2023 and filed with the Securities and Exchange Commission (“SEC”) pursuant to Rule 424(b)(4) of the Securities Act of 1933, as amended (the “Securities Act”), on March 10, 2023 (the “Final IPO Prospectus”). Reorganization Pursuant to a master reorganization agreement dated March 8, 2023, by and among Old Atlas, Atlas Sand Management Company, LLC, a Texas limited liability company (“ASMC”), Atlas LLC, Atlas Sand Holdings, LLC, a Delaware limited liability company (“Holdings”), Atlas Sand Operating, LLC, a Delaware limited liability company (“Atlas Operating”), Atlas Sand Holdings II, LLC, a Delaware limited liability company (“Holdings II”), Atlas Sand Management Company II, LLC, a Delaware limited liability company (“ASMC II”), and Atlas Sand Merger Sub, LLC, a Delaware limited liability company (“Merger Sub”), Old Atlas and the parties thereto completed certain restructuring transactions (the “Reorganization”) in connection with the IPO. As part of the Reorganization: • Merger Sub merged with and into Atlas LLC, with Atlas LLC surviving as a wholly owned subsidiary of Atlas Operating; • Holdings, Holdings II and ASMC II were formed (collectively with ASMC, the “HoldCos”), through which certain holders who previously held membership interests in Atlas LLC (the “Legacy Owners”) were issued the membership interests in Atlas Operating, as represented by a single class of common units (“Operating Units”); • certain Legacy Owners, through the HoldCos, transferred all or a portion of their Operating Units and voting rights, as applicable, in Atlas Operating to Old Atlas in exchange for an aggregate of 39,147,501 shares of Old Atlas Class A common stock and, in the case of Legacy Owners that continued to hold Operating Units through the HoldCos, an aggregate of 42,852,499 shares of Class B common stock, par value $ 0.01 per share, of Old Atlas (the “Old Atlas Class B common stock,” and together with the Old Atlas Class A common stock, the “Old Atlas common stock”), so that such Legacy Owners that continued to hold Operating Units also held, through the HoldCos, one share of Old Atlas Class B common stock for each Operating Unit held by them immediately following the Reorganization; • the 1,000 shares of Old Atlas Class A common stock issued to Atlas LLC at the formation of Old Atlas were redeemed and canceled for nominal consideration; and • Old Atlas contributed all of the net proceeds received by it in the IPO to Atlas Operating in exchange for a number of Operating Units equal to the number of shares of Old Atlas Class A common stock outstanding after the IPO, and Atlas Operating further contributed the net proceeds received to Atlas LLC. As a result of the Reorganization, (i) Old Atlas’s sole material asset consisted of Operating Units, (ii) Atlas Operating’s sole material asset consisted, and still consists, of 100% of the membership interests in Atlas LLC and (iii) Atlas LLC owns all of the Company’s operating assets. Old Atlas is the managing member of Atlas Operating and is responsible for all operational, management and administrative decisions relating to Atlas LLC’s business and consolidates the financial results of Atlas LLC and its subsidiaries. As a result of the IPO and Reorganization: • the Legacy Owners collectively owned all of the outstanding shares of Old Atlas Class B common stock and 39,147,501 shares of Old Atlas Class A common stock, collectively representing 82.0 % of the voting power and 68.5 % of the economic interest of Old Atlas (and 82.0% of the economic interest of Atlas LLC, including both direct and indirect ownership interests) at the closing of the IPO and Reorganization; • Old Atlas owned, and still owns, an approximate 57.1 % interest in Atlas Operating; and • the Legacy Owners that continued to hold Operating Units collectively owned an approximate 42.9 % interest in Atlas Operating. On September 13, 2023, we distributed the Operating Units and shares of Old Atlas common stock previously held by the HoldCos to the Legacy Owners in accordance with the distribution provisions of each respective HoldCo operating agreement. Immediately following the distribution, the Legacy Owners held shares of Old Atlas Class A common stock or Old Atlas Class B common stock (and corresponding Operating Units) directly. On March 13, 2023, the date on which we closed the IPO, a corresponding deferred tax liability of approximately $ 27.5 million was recorded associated with the differences between the tax and book basis of the investment in Atlas LLC. The offset of the deferred tax liability was recorded to additional paid-in capital. As there was no change in control of Atlas Operating, Atlas LLC, or the businesses or subsidiaries held by Atlas LLC as a result of the Reorganization, purchase accounting was not required and the Legacy Owners’ interests in Operating Units were recognized as a noncontrolling interest in Atlas Operating. Up-C Simplification On October 2, 2023, Old Atlas and the Company completed the previously announced Up-C Simplification (as defined below) contemplated by the Master Reorganization Agreement (the “Master Reorganization Agreement”), dated as of July 31, 2023, by and among the Company, Old Atlas, Atlas Operating, AESI Merger Sub Inc., a Delaware corporation (“PubCo Merger Sub”), Atlas Operating Merger Sub, LLC, a Delaware limited liability company (“Opco Merger Sub” and, together with PubCo Merger Sub, the “Merger Subs”), and Atlas Sand Holdings, LLC, a Delaware limited liability company (“Holdings”), in order to, among other things, reorganize under a new public holding company (the “Up-C Simplification”). Pursuant to the Master Reorganization Agreement, (a) PubCo Merger Sub merged with and into Old Atlas (the “PubCo Merger”), as a result of which (i) each share of Old Atlas Class A common stock then issued and outstanding was exchanged for one share of common stock of New Atlas, par value $ 0.01 per share (the “New Atlas Common Stock”), (ii) all of the shares of Old Atlas Class B common stock then issued and outstanding were surrendered and cancelled for no consideration and (iii) Old Atlas survived the PubCo Merger as a direct, wholly owned subsidiary of the Company; and (b) Opco Merger Sub merged with and into Atlas Operating (the “Opco Merger” and, together with the PubCo Merger, the “Mergers”), as a result of which (i) each Operating Unit then issued and outstanding, other than those Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock and (ii) Atlas Operating became a wholly owned subsidiary (partially direct and partially indirect through Old Atlas) of New Atlas. In connection with the Up-C Simplification: • each share of Old Atlas Class A common stock issued and outstanding immediately prior to the effective time of the Mergers (the “Effective Time”) was exchanged for one share of New Atlas Common Stock and the holders of Old Atlas Class A common stock became stockholders of New Atlas; • all of the Old Atlas Class B common stock issued and outstanding immediately prior to the Effective Time were surrendered and cancelled for no consideration; • each Operating Unit issued and outstanding immediately prior to the Effective Time, other than Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock, and the holders of such Operating Units became stockholders of New Atlas; • Old Atlas continues to hold all of the issued and outstanding Operating Units it held as of immediately prior to the Effective Time, such Operating Units were otherwise unaffected by the Up-C Simplification (including the Opco Merger), and such Operating Units, together with the Operating Units received by New Atlas in connection with the Opco Merger, constitute all of the Operating Units currently issued and outstanding; • Old Atlas became a direct, wholly owned subsidiary of New Atlas, and all of the Old Atlas Class A common stock then held by New Atlas were recapitalized into a single share; • as of the Effective Time, New Atlas assumed (a) the Atlas Energy Solutions Inc. Long Term Incentive Plan (the “LTIP”), (b) all awards of restricted stock units and performance share units, in each case, whether vested or unvested, that were then outstanding under the LTIP, (c) the grant notices and agreements evidencing such awards, and (d) the then remaining unallocated share reserve issuable under the LTIP; and the terms and conditions that were in effect immediately prior to the Up-C Simplification under each outstanding award assumed by New Atlas continue in full force and effect after the Up-C Simplification, with certain exceptions to reflect the completion of the Up-C Simplification, such as each award denominated with reference to shares of New Atlas Common Stock instead of Old Atlas Class A common stock and the performance share unit awards being in reference to performance of New Atlas instead of performance of Old Atlas (with respect to the portion of the applicable performance period following the Up-C Simplification); • as of the Effective Time, (a) New Atlas assumed Old Atlas’s existing Management Change in Control Severance Plan (and each participation agreement thereunder that was then outstanding) and (b) the terms and conditions of the director compensation program applicable to members of the board of directors of Old Atlas (and any committees thereof) were applied instead to members of the board of directors of New Atlas (and any committees thereof) (and any portion of such compensation to be granted in the form of equity-based awards will be granted in awards denominated with reference to shares of New Atlas Common Stock instead of Old Atlas Class A common stock); and • Old Atlas changed its name from “Atlas Energy Solutions Inc.” to “AESI Holdings Inc.,” and New Atlas changed its name from “New Atlas HoldCo Inc.” to “Atlas Energy Solutions Inc.” New Atlas was approved to have the shares of New Atlas Common Stock listed on the New York Stock Exchange under the ticker symbol “AESI,” the trading symbol previously used by Old Atlas. After completion of the Up-C Simplification, New Atlas replaced Old Atlas as the publicly held entity and, through its subsidiaries, will conduct all of the operations previously conducted by Old Atlas, and Old Atlas will remain the managing member of Atlas Operating. The foregoing description is not complete and is qualified in its entirety by reference to the Master Reorganization Agreement, a copy of which is filed as Exhibit 2.1 to this Quarterly Report on Form 10-Q (this “Report”). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 – Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements (the “Financial Statements”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and SEC requirements. All adjustments necessary for a fair presentation of the Financial Statements have been included. Such adjustments are of a normal, recurring nature. These condensed consolidated financial statements include the accounts of New Atlas, Old Atlas, Atlas Operating, Atlas LLC, and Atlas LLC’s wholly owned subsidiaries: Atlas Sand Employee Company, LLC; Atlas OLC Employee Company, LLC; Atlas Construction Employee Company, LLC; Atlas Sand Employee Holding Company, LLC; Fountainhead Logistics Employee Company, LLC; Atlas Sand Construction, LLC; OLC Kermit, LLC; OLC Monahans, LLC; Fountainhead Logistics, LLC; and Fountainhead Transportation Services, LLC. The results of operations for the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any other period. The Financial Statements and these notes should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2022 included within the Company’s prospectus, dated September 11, 2023, filed with the SEC pursuant to Rule 424(b) under the Securities Act on September 12, 2023 in connection with our Up-C Simplification (the “Up-C Simplification Prospectus”). As discussed in Note 1 - Business and Organization , as a result of our IPO and the Reorganization and prior to the Up-C Simplification, Old Atlas became the managing member of Atlas Operating and consolidated entities in which it had a controlling financial interest through the end of the reporting period. The Reorganization was considered a transaction between entities under common control. As a result, the financial statements for periods prior to the IPO and the Reorganization have been adjusted to combine the previously separate entities for presentation purposes. However, Old Atlas and Atlas Operating had no operations or assets and liabilities prior to our IPO. As such, for periods prior to the completion of our IPO, the consolidated financial statements represent the historical financial position and results of operations of Atlas LLC and its subsidiaries. For periods after the completion of our IPO through the end of the reporting period, the financial position and results of operations include those of Old Atlas and report the redeemable noncontrolling interest related to the portion of Operating Units not owned by Old Atlas. Up-C Simplification During the fourth quarter 2023, for accounting purposes, the Up-C Simplification will be treated as a transaction between entities under common control of an acquisition of noncontrolling interest. Accordingly, the fourth quarter 2023 consolidated financial position and results of operations of the Company will be included in the consolidated financial statements of New Atlas on the same basis as currently presented except for the acquisition of noncontrolling interest that will be accounted for as a capital transaction with no resulting gain or loss. Consolidation The Financial Statements include the accounts of the Company and controlled subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation. Use of Estimates The preparation of the Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities at the date of the Financial Statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates used in the preparation of these Financial Statements include, but are not limited to: the sand reserves and their impact on calculating the depletion expense under the units-of-production method; the depreciation and amortization associated with property, plant and equipment; stock and unit-based compensation; spare parts inventory reserve; collectability of receivables; certain liabilities; and income tax expense. We base estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. Cash and cash equivalents Cash and cash equivalents consist of all highly liquid investments that are readily convertible into cash and have original maturities of three months or less when purchased. As of September 30, 2023, we have deposits of $ 119.4 million in an Insured Cash Sweep (“ICS”) Deposit Placement Agreement within IntraFi Network LLC facilitated by our bank. The ICS program provides the Company with access to FDIC insurance for our total cash held within the ICS. We had an additional $ 112.3 million in 2-month and 3-month United States Treasury Bills which are fully backed by the United States as of September 30, 2023. We place our remaining cash deposits with high-credit-quality financial institutions. At times, a portion of our cash may be uninsured or in deposit accounts that exceed or are not covered under the Federal Deposit Insurance Corporation limit. Accounts Receivable and Allowance for Credit Losses Accounts receivable are recorded at cost when earned and represent claims against third parties that will be settled in cash. These receivables generally do not bear interest. The carrying value of our receivables, net of allowance for credit losses, represents the estimated collectable amount. If events or changes in circumstances indicate specific receivable balances may be impaired, further consideration is given to our ability to collect those balances and the allowance is adjusted accordingly. We perform credit evaluations of new customers, and sometimes require deposits and prepayments, to mitigate credit risk. When it is probable that all or part of an outstanding balance will not be collected, we establish an allowance for credit losses. On January 1, 2023, we adopted Accounting Standards Update (“ASU”) 2016-13, Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments, which replaced the prior incurred loss impairment model with an expected credit loss impairment model for financial instruments, including accounts receivable. The adoption of ASU 2016-13 did not result in a material cumulative-effect adjustment to retained earnings on January 1, 2023. We are exposed to credit losses primarily through sales of products and services. We analyze accounts receivable on an individual customer and overall basis through review of historical collection experience and current aging status of our customer accounts. We also consider the financial condition and economic environment of our customers in evaluating the need for an allowance. During the three and nine months ended September 30, 2023, we recognized de minimis allowance for credit losses. As of September 30, 2023 and December 31, 2022, we had de minimis allowance for credit losses, which is included in accounts receivable on the condensed consolidated balance sheets. As of September 30, 2023, three customers represented 20 %, 14 %, and 11 % of our outstanding accounts receivable balance. As of December 31, 2022, two customers represented 19 % and 13 % of our outstanding accounts receivable balance. Fair Value of Financial Instruments Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. The amounts reported in the balance sheets as current assets or liabilities, including cash and cash equivalents, accounts receivable, spare parts inventories, inventories, prepaid expenses and other current assets, accounts payable, accrued liabilities and deferred revenues approximate fair value due to the short-term maturities of these instruments. As of the dates indicated, our long-term debt consisted of the following (in thousands): At September 30, 2023 At December 31, 2022 Carrying Value Fair Value Carrying Value Fair Value Valuation Technique Financial liabilities Outstanding principal amount of the 2023 Term Loan Credit Facility $ 172,511 $ 181,003 $ 147,174 $ 146,837 Level 2 – Market Approach Our credit agreement with Stonebriar Commercial Finance LLC (“Stonebriar”) pursuant to which Stonebriar extended a $ 180.0 million single advance seven-year term loan credit facility (the "2023 Term Loan Credit Facility") bears interest at a fixed rate of 9.50 %, where its fair value will fluctuate based on changes in interest rates and credit quality. As of September 30, 2023 and December 31, 2022, the fair value of long-term debt has been determined by discounting the future cash flows using current market interest rates for similar financial instruments. These inputs are not quoted prices in active markets, but they are either directly or indirectly observable; therefore, they are classified as Level 2 inputs. See Note 6 - Debt for discussion of the credit agreement governing the 2023 Term Loan Credit Facility. Stock-Based Compensation We account for stock-based compensation, including grants of incentive units, restricted stock awards, time-based restricted stock units and performance share units, under the measurement and recognition provisions of Accounting Standards Codification (“ASC”) 718, Compensation – Stock Compensation (“ASC 718”). We account for stock and unit-based compensation by amortizing the fair value of the stock or units, which is determined at the grant date, on a straight-line basis unless the tranche method is required. We account for forfeitures as they occur and reverse any previously recognized stock or unit-based compensation expense for the unvested portion of the awards that were forfeited. Earnings Per Share We use the treasury stock method to determine the potential dilutive effect of outstanding restricted stock units and performance share units. We evaluated the potential dilutive effect of Old Atlas Class B common stock using the “if-converted” method, noting conversion of Old Atlas Class B common stock to Class A common stock would not have a dilutive impact to earnings per share. Each share of Old Atlas Class B common stock was issued in conjunction with and only as a consequence of the issuance by Atlas Operating of an Operating Unit to a securityholder other than Old Atlas. Old Atlas is a holding company the only assets of which are equity interests in Atlas Operating. For the reporting period, the earnings of Atlas Operating per unit were attributable to Old Atlas and the other Legacy Owners, as the holders of the outstanding Operating Units. Because each holder of Operating Units other than Old Atlas also held one share of Old Atlas Class B common stock, and because Old Atlas consolidated the results of operations of Atlas Operating, the earnings per Operating Unit attributable to the Legacy Owners for the reporting period were derivatively attributable to the corresponding shares of Old Atlas Class B common stock held by such Legacy Owners. For that reason, when a Legacy Owner determined to exercise its Redemption Right (as defined below in Note 8 - Stockholders' Equity ) and exchange an Operating Unit (and corresponding share of Old Atlas Class B common stock), for a share of Old Atlas Class A common stock, there was not a dilutive impact to the earnings per share of the Old Atlas Class A common stock. In connection with the Up-C Simplification, each Operating Unit issued and outstanding immediately prior to the Effective Time, other than Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock, and the holders of such Operating Units became stockholders of New Atlas, and all of the Old Atlas Class B common stock issued and outstanding immediately prior to the Effective Time were surrendered and cancelled for no consideration. This exchange is not expected to have a dilutive impact on the fourth quarter 2023 earnings per share. See Note 8 – Stockholders Equity – Up-C Simplification for more information. As a result of the IPO, the presentation of earnings per share for the periods prior to the IPO is not meaningful and only earnings per share for periods subsequent to the IPO are presented herein. See Note 11 – Earnings Per Share for additional information. Redeemable Noncontrolling Interest We account for the Legacy Owners’ historical 42.2 % economic interest in Atlas Operating through ownership of Operating Units as redeemable noncontrolling interest. The redeemable noncontrolling interest is recognized at the higher of (1) its initial fair value plus accumulated earnings associated with the redeemable noncontrolling interest or (2) the redemption value as of the balance sheet date. At September 30, 2023, the redeemable noncontrolling interest was recorded based on the redemption value as of the balance sheet date as this amount was higher than the its initial fair value plus accumulated income associated with the redeemable noncontrolling interest at September 30, 2023. The redemption amount is based on the 10-day volume-weighted average closing price of shares of Old Atlas Class A common stock at the end of the reporting period. Changes in the redemption value were recognized immediately as they occurred, as if the end of the reporting period was also the redemption date for the instrument, with an offsetting entry to retained earnings, or additional paid-in capital in the absence of retained earnings and further to accumulated deficit in the absence of additional paid in capital. For more information, refer to Note 9 - Redeemable Noncontrolling Interest. In connection with the Up-C Simplification, each Operating Unit issued and outstanding immediately prior to the Effective Time, other than Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock, and the holders of such Operating Units became stockholders of New Atlas, and all of the Old Atlas Class B common stock issued and outstanding immediately prior to the Effective Time were surrendered and cancelled for no consideration. See Note 8 – Stockholders Equity – Up-C Simplification for more information. Income Taxes For the purposes of this discussion, references to “Atlas Inc.” are to Old Atlas for reporting periods prior to the completion of the Up-C Simplification (the “Closing”), and to New Atlas following the Closing. Atlas Inc. is a corporation and it is subject to U.S. federal, state and local income taxes. The tax implications of the Reorganization referenced in Note 1 - Business and Organization and the tax impact of the Company’s status as a taxable corporation subject to U.S. federal, state and local income taxes have been reflected in the accompanying Financial Statements. Atlas Inc. accounts for income taxes using the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled pursuant to the provisions of ASC 740, Income Taxes. The effect on deferred tax assets and liabilities of a change in tax rate is recognized in earnings in the period that includes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts more likely than not to be realized. Atlas Inc. computes its quarterly taxes under the effective tax rate method based on applying an anticipated annual effective rate to its year-to-date income, except for discrete items. Income taxes for discrete items are computed and recorded in the period that the specific transaction occurs. Atlas LLC, the Company’s predecessor, was organized as a limited liability company. As a limited liability company, Atlas LLC elected to be treated as a partnership for income tax purposes and, therefore, is not subject to U.S. federal income tax. Rather, the U.S. federal income tax liability with respect to the taxable income of our predecessor was passed through to its owners. We evaluate the uncertainty in tax positions taken or expected to be taken in the course of preparing the condensed consolidated financial statements to determine whether the tax positions are more likely than not of being sustained by the applicable tax authority. However, the conclusions regarding the evaluation are subject to review and may change based on factors including, but not limited to, ongoing analysis of tax laws, regulations, and interpretations thereof. As of September 30, 2023 and December 31, 2022, we did no t have any liabilities for uncertain tax positions or gross unrecognized tax benefits. Our income tax returns from 2018, 2019, 2020, 2021 and 2022 are open to examinations by U.S. federal, state or local tax authorities. We cannot predict or provide assurance as to the ultimate outcome of any existing or future examinations. Recently Issued Accounting Pronouncements Rate Reform – In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional guidance for a limited time to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. The amendments apply only to contracts and hedging relationships that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform. These amendments are effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. In December 2022, FASB issued ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848. ASU 2022-06 amended ASU 2020-04 and deferred the sunset date of Topic 848 from December 31, 2022, to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. As described in Note 6 - Debt, our previous asset-based loan credit facility (the “2018 ABL Credit Facility”) was terminated on February 22, 2023. The 2018 ABL Credit Facility was our only material agreement affected by reference rate reform as of September 30, 2023. We will continue to evaluate the impact of this standard on the Financial Statements and do not believe it will have a material impact on the Financial Statements. Financial Instruments – In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326), which amended the guidance on the impairment of financial instruments. The standard added an impairment model, referred to as current expected credit loss, which is based on expected losses rather than incurred losses. The standard applies to most debt instruments, trade receivables, lease receivables, reinsurance receivables, financial guarantees and loan commitments. Under the guidance, companies are required to disclose credit quality indicators disaggregated by year of origination for a five-year period. In May 2019, ASU 2016-13 was subsequently amended by ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments—Credit Losses, ASU 2019-05, Financial Instruments—Credit Losses (Topic 326): Targeted Transition Relief. The new guidance became effective for fiscal years beginning after December 15, 2022. We adopted ASU 2016-13 on January 1, 2023. ASU 2016-13 was applied using a modified retrospective approach, with a cumulative-effect adjustment to the opening balance of retained earnings as of the adoption date. We analyzed trade accounts receivable on an individual customer and overall basis through review of historical collection experience and current aging status of our customer accounts. We also consider the financial condition and economic environment of our customers in evaluating the need for an allowance. There was no material cumulative impact of adoption in the opening balance of retained earnings as of January 1, 2023. See Accounts Receivable and Allowance for Credit Losses discussed within this Note. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2023 | |
Inventory, Net [Abstract] | |
Inventories | Note 3 – Inventories Inventories consisted of the following (in thousands): September 30, 2023 December 31, 2022 Raw materials $ 531 $ 290 Work-in-process 2,924 4,825 Finished goods 506 499 Inventories $ 3,961 $ 5,614 No inventory reserve was deemed necessary as of September 30, 2023 or December 31, 2022. |
Property, Plant and Equipment,
Property, Plant and Equipment, Net | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, Net | Note 4 – Property, Plant and Equipment, Net Property, plant and equipment, net, consisted of the following (in thousands): September 30, 2023 December 31, 2022 Plant facilities associated with productive, depletable properties $ 244,464 $ 243,613 Plant equipment 351,583 251,122 Land 3,009 3,009 Furniture and office equipment 2,267 1,407 Computer and network equipment 1,648 1,648 Buildings and leasehold improvements 32,382 25,402 Logistics equipment 44,647 1,591 Construction in progress 271,789 111,711 Property, plant and equipment 951,789 639,503 Less: Accumulated depreciation and depletion ( 122,792 ) ( 97,979 ) Property, plant and equipment, net $ 828,997 $ 541,524 Depreciation expense and depletion expense recognized in depreciation, depletion and accretion expense was $ 8.7 million and $ 1.5 million, respectively, for the three months ended September 30, 2023, as compared to $ 5.7 million and $ 1.4 million, respectively, for the three months ended September 30, 2022. Depreciation expense and depletion expense recognized in depreciation, depletion and accretion expense was $ 23.8 million and $ 4.4 million for the nine months ended September 30, 2023, respectively, as compared to $ 15.7 million and $ 4.0 million for the nine months ended September 30, 2022, respectively. Depreciation expense recognized in selling, general and administrative expense was $ 0.5 million for the three months ended September 30, 2023 as compared to $ 0.2 million for the three months ended September 30, 2022. Depreciation expense recognized in selling, general and administrative expense was $ 1.2 million for the nine months ended September 30, 2023 as compared to $ 0.8 million for the nine months ended September 30, 2022. We did no t recognize impairment of long-lived assets or loss on disposal of assets for the three and nine months ended September 30, 2023 and 2022. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Leases | Note 5 – Leases We have operating and finance leases primarily for office space, equipment, and vehicles. The terms and conditions for these leases vary by the type of underlying asset. Certain leases include variable lease payments for items such as property taxes, insurance, maintenance, and other operating expenses associated with leased assets. Payments that vary based on an index or rate are included in the measurement of lease assets and liabilities at the rate as of the commencement date. All other variable lease payments are excluded from the measurement of lease assets and liabilities, and are recognized in the period in which the obligation for those payments is incurred. The components of lease cost were as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2023 2022 2023 2022 Finance lease cost: Amortization of right-of-use assets $ 846 $ 515 $ 4,286 $ 971 Interest on lease liabilities 345 167 1,742 286 Operating lease cost 289 227 823 839 Variable lease cost 160 173 458 515 Short-term lease cost 5,893 3,740 18,255 7,130 Total lease cost $ 7,533 $ 4,822 $ 25,564 $ 9,741 Supplemental cash flow and other information related to leases were as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2023 2022 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 443 $ 290 $ 1,018 $ 1,016 Operating cash outflows from finance leases $ 345 $ 167 $ 1,742 $ 286 Financing cash outflows from finance leases $ 232 $ 310 $ 1,932 $ 703 Right-of-use assets obtained in exchange for new lease liabilities: Operating leases $ — $ — $ 559 $ 5,384 Finance leases $ 4,187 $ 7,262 $ 25,063 $ 11,213 During the nine months ended September 30, 2022, we modified an agreement related to certain operating right-of-use assets of $ 1.3 million and liabilities of $ 1.3 million; the change in terms increased the amount, extended the term, and resulted in finance lease classification. In connection with this modification, we recognized finance lease right-of-use assets of $ 3.2 million and liabilities of $ 3.2 million. There was no gain or loss recognized as a result of these amendments. Lease terms and discount rates as of September 30, 2023 and December 31, 2022 are as follows: September 30, 2023 December 31, 2022 Weighted-average remaining lease term: Operating leases 3.9 years 4.5 years Finance leases 3.6 years 5.3 years Weighted-average discount rate: Operating leases 4.6 % 4.3 % Finance leases 5.0 % 9.4 % Future minimum lease commitments as of September 30, 2023 are as follows (in thousands): Finance Operating Remainder of 2023 $ 74 $ 293 2024 176 1,443 2025 90 1,474 2026 90 1,414 2027 90 815 Thereafter 22 11 Total lease payments 542 5,450 Less imputed interest 52 465 Total $ 490 $ 4,985 Supplemental balance sheet information related to our leases as of September 30, 2023 and December 31, 2022 was as follows (in thousands): Classification September 30, 2023 December 31, 2022 Operating Leases Current operating lease liabilities Other current liabilities $ 1,227 $ 1,082 Noncurrent operating lease liabilities Other long-term liabilities $ 3,758 $ 4,287 Finance Leases Current finance lease liabilities Other current liabilities $ 208 $ 3,213 Noncurrent finance lease liabilities Other long-term liabilities $ 282 $ 16,942 On July 31, 2023, Atlas LLC entered into a credit agreement (the “2023 Term Loan Credit Agreement”) with Stonebriar, as administrative agent and initial lender, pursuant to which Stonebriar extended Atlas LLC a term loan credit facility comprising a $ 180.0 million single advance term loan that was made on July 31, 2023 (the “Initial Term Loan”) and commitments to provide up to $ 100.0 million of delayed draw term loans (collectively, the “2023 Term Loan Credit Facility”). Proceeds from the 2023 Term Loan Credit Facility were used to repay $ 133.4 million of 2021 Term Loan Credit Facility principal and accrued interest, terminate $ 42.8 million of finance lease liabilities, as well as acquire $ 39.5 million of finance lease assets associated with certain equipment lease arrangements with Stonebriar. There was no gain or loss recognized as a result of this transaction. See Note 6 - Debt for further discussion on the 2023 Term Loan Credit Facility. On May 16, 2022, Atlas LLC entered into a master lease agreement with Stonebriar for the right, but not the obligation, to fund up to $ 70.0 million of purchases of transportation and logistics equipment. The interim financing for down payments on any purchased equipment is based on one-month SOFR, plus 8.0 %. The final interest rate is set upon acceptance of the equipment based on the terms of the agreement. On July 31, 2023, in connection with entering into 2023 Term Loan Credit Agreement, all obligations under this master lease agreement were terminated, all associated assets were acquired and this master lease agreement was terminated. There was no gain or loss recognized as a result of this transaction. On July 28, 2022, Atlas LLC entered into a master lease agreement with Stonebriar for the right, but not the obligation, to fund up to $ 10.0 million of purchases of dredges and related equipment. The interim financing for down payments on any purchased equipment is based on one-month SOFR, plus 8.0 %. The final interest rate is set upon acceptance of the equipment based on the terms of the agreement. On July 31, 2023, in connection with entering into the 2023 Term Loan Credit Agreement, all obligations under this master lease agreement were terminated, all associated assets were acquired and this master lease agreement was terminated. There was no gain or loss recognized as a result of this transaction. As of September 30, 2023, we had no additional leases that have not yet commenced. Certain transportation and logistics leases discussed here are a component of the purchase commitments discussed in Note 7 - Commitments and Contingencies. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Note 6 – Debt Debt consists of the following (in thousands): September 30, 2023 December 31, 2022 Term Loan Credit Facility $ 180,000 $ 148,995 Less: Debt discount, net of accumulated amortization of $ 189 and $ 546 , respectively ( 7,060 ) ( 1,254 ) Less: Deferred financing fees, net of accumulated amortization of $ 11 and $ 248 , respectively ( 429 ) ( 567 ) Less: Current portion (a) — ( 20,586 ) Long-term debt $ 172,511 $ 126,588 (a) The current portion of long-term debt reflects payments based on the terms of the 2023 Term Loan Credit Facility and the 2021 Term Loan Credit Facility as of September 30, 2023 and December 31, 2022, respectively. 2023 Term Loan Credit Facility On July 31, 2023, Atlas LLC entered into the 2023 Term Loan Credit Agreement. The Initial Term Loan is payable in eighty-four consecutive monthly installments and a final payment of the remaining outstanding principal balance at maturity. The Initial Term Loan has a final maturity date of July 31, 2030 (the “Maturity Date”). The Initial Term Loan bears interest at a rate equal to 9.50 % per annum. Each delayed draw term loan under the 2023 Term Loan Credit Facility (“DDT Loans”) will be payable in equal monthly installments, with the monthly installments comprising 80 % of the delayed draw term loan and a final payment of the remaining 20 % of the outstanding principal balance due at maturity, unless earlier prepaid. The DDT Loans will bear interest at a rate equal to the applicable Term SOFR Rate (as defined in the 2023 Term Loan Credit Agreement) plus 5.95 % per annum. All monthly installments with respect to the Initial Term Loan and the DDT Loans payable on or prior to January 1, 2025 will be interest only. At any time prior to the Maturity Date, Atlas LLC may redeem loans outstanding under the 2023 Term Loan Credit Facility, in whole or in part, at a price equal to 100 % of the principal amount being prepaid (the “Prepayment Amount”) plus a prepayment fee. The prepayment fee is equal to 8 % of the Prepayment Amount for any prepayment that occurs on or prior to December 31, 2024, 4 % of the Prepayment Amount for any prepayment that occurs after December 31, 2024 but on or prior to December 31, 2025, 3 % of the Prepayment Amount for any prepayment that occurs after December 31, 2025 but on or prior to December 31, 2026 and 2 % of the Prepayment Amount for any prepayment that occurs thereafter. Upon the maturity of the 2023 Term Loan Credit Facility, the entire unpaid principal amount of the loans outstanding thereunder, together with interest, fees and other amounts payable in connection with the facility, will be immediately due and payable without further notice or demand. Dividends and distributions to equity holders are permitted to be made pursuant to certain limited exceptions and baskets described in the 2023 Term Loan Credit Agreement and otherwise generally subject to certain restrictions set forth in the 2023 Term Loan Credit Agreement, including the requirements that (a) no Event of Default (as defined under the 2023 Term Loan Credit Agreement) has occurred and is continuing and (b) Atlas LLC maintains at least $ 30.0 million of Liquidity (as defined under the 2023 Term Loan Credit Agreement) pro forma for the Restricted Payment (as defined under the 2023 Term Loan Credit Agreement). The 2023 Term Loan Credit Facility includes certain non-financial covenants, including but not limited to restrictions on incurring additional debt and certain distributions. The 2023 Term Loan Credit Facility is subject to a maximum 4.0 to 1.0 Leverage Ratio (as defined in the 2023 Term Loan Credit Agreement) financial covenant. Such financial covenant is tested as of the last day of each fiscal quarter. Proceeds from the 2023 Term Loan Credit Facility were used to repay outstanding indebtedness under our previous 2021 Term Loan Credit Facility with Stonebriar, to repay obligations outstanding under certain equipment lease arrangements with Stonebriar and for general corporate purposes. As of September 30, 2023, Atlas LLC was in compliance with the covenants of the 2023 Term Loan Credit Facility. The 2023 Term Loan Credit Facility is unconditionally guaranteed, jointly and severally, by Atlas LLC and its subsidiaries and secured by substantially all of the assets of Atlas LLC and its subsidiaries. The 2023 Term Loan Credit Facility is also unconditionally guaranteed on an unsecured basis by Atlas Inc. 2023 ABL Credit Facility On February 22, 2023, Atlas LLC, certain of its subsidiaries, as guarantors, Bank of America, N.A., as administrative agent, and certain financial institutions party thereto as lenders (the “2023 ABL Lenders”) entered into a Loan, Security and Guaranty Agreement (the “2023 ABL Credit Agreement”) pursuant to which the 2023 ABL Lenders provide revolving credit financing to the Company in an aggregate principal amount of up to $ 75.0 million (the “2023 ABL Credit Facility”), with Availability (as defined in the 2023 ABL Credit Agreement) thereunder subject to a “Borrowing Base” as described in the 2023 ABL Credit Agreement. The 2023 ABL Credit Facility includes a letter of credit sub-facility, which permits issuance of letters of credit up to an aggregate amount of $ 25.0 million. The scheduled maturity date of the 2023 ABL Credit Facility is February 22, 2028 ; provided that the 2023 ABL Credit Facility will mature on June 30, 2027 if any amount of the 2023 Term Loan Credit Facility that has a maturity date less than 91 days prior to February 22, 2028 is outstanding on June 30, 2027. As of September 30, 2023, Atlas LLC had no outstanding borrowings and $ 1.1 million outstanding letters of credit under the 2023 ABL Credit Facility. Atlas LLC may also request swingline loans under the 2023 ABL Credit Agreement in an aggregate principal amount not to exceed $ 7.5 million. During the three and nine months ended September 30, 2023, Atlas LLC had no outstanding swingline loans under the 2023 ABL Credit Facility. Borrowings under the 2023 ABL Credit Facility bear interest, at Atlas LLC’s option, at either a base rate or Term SOFR, as applicable, plus an applicable margin based on average availability as set forth in the 2023 ABL Credit Agreement. Term SOFR loans bear interest at Term SOFR for the applicable interest period plus an applicable margin, which ranges from 1.50 % to 2.00 % per annum based on average availability as set forth in the 2023 ABL Credit Agreement. Base rate loans bear interest at the applicable base rate, plus an applicable margin, which ranges from 0.50 % to 1.00 % per annum based on average availability as set forth in the 2023 ABL Credit Agreement. In addition to paying interest on outstanding principal under the 2023 ABL Credit Facility, Atlas LLC is required to pay a commitment fee which ranges from 0.375 % per annum to 0.500 % per annum with respect to the unutilized commitments under the 2023 ABL Credit Facility, based on the average utilization of the 2023 ABL Credit Facility. Atlas LLC is required to pay customary letter of credit fees, to the extent that one or more letter of credit is outstanding. For both the three and nine months ended September 30, 2023 and 2022, we recognized $ 0.1 million and $ 0.2 million of interest expense, unutilized commitment fees and other fees under the 2023 ABL Credit Facility, classified as interest expense. The Borrowing Base was initially set at $ 75.0 million and the amount of available credit changes every month, depending on the amount of eligible accounts receivable and inventory we have available to serve as collateral. The Borrowing Base components are subject to customary reserves and eligibility criteria. As of September 30, 2023, the Borrowing Base was $ 75.0 million and Availability was $ 73.9 million. The 2023 ABL Credit Facility requires that if Availability is less than the greater of (i) 12.50 % of the Borrowing Base and (ii) $ 7.5 million, Atlas LLC must maintain a Fixed Charge Coverage Ratio (as defined in the 2023 ABL Credit Agreement) of at least 1.00 to 1.00 while a Covenant Trigger Period (as defined in the 2023 ABL Credit Agreement) is in effect. Under the 2023 ABL Credit Agreement, Atlas LLC is permitted to make payments of dividends and distributions pursuant to certain limited exceptions and baskets set forth therein and otherwise generally subject to certain restrictions described therein, including that (i) no Event of Default (as defined under the 2023 ABL Credit Agreement) has occurred and is continuing, and (ii) no loans and no more than more than $ 7.5 million in letters of credit are outstanding, and liquidity exceeds $ 30.0 million at all times during the 30 days prior to the date of the dividend or distribution; provided that if any loans are outstanding or outstanding letters of credit exceed $ 7.5 million and no Event of Default (as defined under the 2023 ABL Credit Agreement) has occurred and is continuing, Atlas LLC is permitted to make payments of dividends and distributions subject to a minimum Fixed Charge Coverage Ratio (as defined under the 2023 ABL Credit Agreement) of 1.00 to 1.00 and satisfaction of minimum availability thresholds under the Borrowing Base (as defined under the 2023 ABL Credit Agreement), as provided under the 2023 ABL Credit Agreement. Additionally, Atlas LLC may make additional payments of dividends and distributions in qualified equity interests and may make Permitted Tax Distributions (as defined under the 2023 ABL Credit Agreement). The 2023 ABL Credit Facility contains certain customary representations and warranties, affirmative and negative covenants, and events of default. As of September 30, 2023, the Company was in compliance with the covenants under the 2023 ABL Credit Facility. The 2023 ABL Credit Facility is unconditionally guaranteed, jointly and severally, by Atlas LLC and certain of its subsidiaries and secured by substantially all of the assets of Atlas LLC and certain of its subsidiaries, excluding: OLC Kermit, LLC, OLC Monahans, LLC and Atlas OLC Employee Company, LLC. 2021 Term Loan Credit Facility On October 20, 2021, Atlas LLC entered into the 2021 Term Loan Credit Facility with Stonebriar. The loans outstanding under the 2021 Term Loan Credit Facility bore interest at a rate of 8.47 % per annum and had an initial maturity date of October 1, 2027 . The 2021 Term Loan Credit Facility was unconditionally guaranteed, jointly and severally, by Atlas LLC and certain of its subsidiaries. On July 31, 2023, Atlas LLC entered into the 2023 Term Loan Credit Agreement with Stonebriar, proceeds from which were used to repay $ 133.4 million of 2021 Term Loan Credit Facility principal and accrued interest, repay $ 42.8 million of finance lease liabilities, as well as acquire $ 39.5 million of finance lease assets associated with certain equipment lease arrangements with Stonebriar. In connection with this refinancing, on July 31, 2023, we paid the lender a prepayment fee on the 2021 Term Loan Credit Facility of $ 2.6 million, a senior secured term loan fee on the 2023 Term Loan Credit Facility of $ 2.7 million and a delayed draw term loan fee on the 2023 Term Loan Credit Facility of $ 2.7 million. As this transaction was accounted for as a modification under ASC 470 - Debt, these fees paid to the lender, as well as previously unamortized debt discount and deferred financing fees associated with the 2021 Term Loan Credit Facility of $ 1.4 million were deferred and recorded as a direct reduction from the carrying amount of the debt obligation on the Company’s consolidated balance sheets. These deferred costs are amortized to interest expense using the effective interest method. 2018 Asset-Based Loan Credit Facility On December 14, 2018, Atlas LLC entered into the 2018 ABL Credit Facility, which provided revolving credit financing with a borrowing capacity of up to $ 50.0 million. The 2018 ABL Credit Facility was unconditionally guaranteed, jointly and severally, by Atlas LLC and certain of its subsidiaries. The 2018 ABL Credit Facility was set to mature on the stated maturity date, December 14, 2023 . On February 22, 2023, Atlas LLC terminated the 2018 ABL Credit Facility. Atlas LLC had no borrowings under the 2018 ABL Credit Facility. In connection with the termination, we charged the remaining balance of the deferred financing cost of $ 0.2 million to interest expense, net on the condensed consolidated statements of operations for the nine months ended September 30, 2023. We incurred de minimis fees associated with the termination. |
Commitments And Contingencies
Commitments And Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 7 – Commitments and Contingencies Royalty Agreements Atlas LLC entered into a royalty agreement associated with its leased property at the Kermit facility and a mining agreement associated with its leased property at the Monahans facility, in each case, with Permian Dunes Holding Company, LLC, a related party. The royalty agreement associated with the Kermit facility terminated on the date of our IPO, pursuant to the terms of the agreement. Under the mining agreement associated with the Monahans facility, we are committed to pay royalties on product sold from that facility and are required to pay a minimum royalty of $ 1.0 million for any lease year following our IPO. Royalty expense associated with these agreements is recorded as the product is sold, is included in costs of sales, and totaled between 5 % and 10 % of cost of sales for the three and nine months ended September 30, 2023, and totaled between 10 % and 15 % of cost of sales for the three and nine months ended September 30, 2022. Standby Letters of Credit As of December 31, 2022, we had $ 1.1 million outstanding in standby letters of credit issued under the 2018 ABL Credit Facility. On February 22, 2023, the 2018 ABL Credit Facility was terminated and our standby letters of credit were transferred to our 2023 ABL Credit Facility. As of September 30, 2023, we had $ 1.1 million outstanding in standby letters of credit issued under the 2023 ABL Credit Facility. Purchase Commitments On March 23, 2022, we entered into an agreement to purchase transportation and logistics equipment in the amount of $ 5.2 million and $ 26.2 million in 2022 and 2023, respectively, subject to customary terms and conditions. As of September 30, 2023, we have $ 15.3 million outstanding under this commitment. On April 20, 2022, we entered into an agreement to purchase transportation and logistics equipment in the amount of $ 8.5 million and $ 11.9 million in 2022 and 2023, respectively, subject to customary terms and conditions. As of September 30, 2023, there was no outstanding commitment associated with this agreement. In addition, in connection with the construction of the Dune Express and construction of the second facility at the Kermit location, we enter short-term purchase obligations for products and services. We expect to use $ 291.2 million of the net proceeds from the IPO and cash flow from operations to fund the obligations over the next 12 to 14 months. Litigation We are involved in various legal and administrative proceedings that arise from time to time in the ordinary course of doing business. Some of these proceedings may result in fines, penalties or judgments being assessed against us, which may adversely affect our financial results. In addition, from time to time, we are involved in various disputes, which may or may not be settled prior to legal proceedings being instituted and which may result in losses in excess of accrued liabilities, if any, relating to such unresolved disputes. Expenses related to litigation reduce operating income. We do not believe that the outcome of any of these proceedings or disputes would have a significant adverse effect on our financial position, long-term results of operations or cash flows. It is possible, however, that charges related to these matters could be significant to our results of operations or cash flows in any single accounting period. Management is not aware of any legal, environmental or other commitments and contingencies that would have a material effect on the Financial Statements. |
Stockholders Equity
Stockholders Equity | 9 Months Ended |
Sep. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
Stockholders Equity | Note 8 – Stockholders Equity Class A Common Stock Old Atlas had 57,767,399 shares of Old Atlas Class A common stock outstanding as of September 30, 2023. Holders of shares of Old Atlas Class A common stock were entitled, and holders of New Atlas Common Stock are entitled, to one vote per share held of record on all matters to be voted upon by the Company’s stockholders and are entitled to ratably receive dividends when and if declared by the Company’s board of directors. Upon liquidation, dissolution, distribution of assets or other winding up, the holders of shares of Old Atlas Class A common stock were entitled, and holders of New Atlas Common Stock are entitled, to receive ratably the assets available for distribution to the stockholders after payment of liabilities and the liquidation preference of any outstanding shares of preferred stock. Class B Common Stock Old Atlas had 42,258,185 shares of Old Atlas Class B common stock outstanding as of September 30, 2023. Holders of shares of Class B common stock were entitled to one vote per share on all matters to be voted upon by the Old Atlas stockholders. Holders of Old Atlas Class A common stock and Old Atlas Class B common stock generally voted together as a single class on all matters presented to Old Atlas’s stockholders for their vote or approval. Holders of Old Atlas Class B common stock did not have any right to receive dividends or distributions upon a liquidation or winding up of Old Atlas. See Note 9 - Redeemable Noncontrolling Interest for more information regarding the Old Atlas Class B common stock. Dividends and Distributions In April 2023, Atlas Operating approved a distribution to its unitholders, Old Atlas and Holdings, in the aggregate amount of $ 4.1 million for the payment of estimated U.S. federal income tax obligations, as permitted by the Amended and Restated Limited Liability Company Agreement of Atlas Operating, dated as of March 8, 2023 (the “Prior Atlas Operating LLCA”). To effect the payment of the distribution, Atlas Operating made a distribution of $ 2.3 million to Old Atlas, which was remitted to the Internal Revenue Service. The related $ 1.8 million pro rata distribution was paid to Holdings. In May 2023, Atlas Operating approved and paid a distribution of $ 0.15 per Operating Unit, in the aggregate amount of $ 15.0 million, as permitted by the Prior Atlas Operating LLCA, and the Company declared a quarterly variable dividend of $ 0.15 per share of Old Atlas Class A common stock. To effect the payment of the dividend, Atlas Operating paid a distribution of $ 0.15 per Operating Unit to each of Old Atlas and Holdings, Old Atlas used its respective distribution to fund the quarterly variable dividend paid to the holders of the Old Atlas Class A common stock, and Holdings distributed its respective distributions to certain Legacy Owners who were holders of membership interests in Holdings. Concurrently with this distribution, Atlas LLC repaid $ 3.8 million of the 2021 Term Loan Credit Facility at par per the terms of the 2021 Term Loan Credit Facility. On July 31, 2023, Atlas Operating approved and paid a distribution of $ 0.20 per Operating Unit, in the aggregate amount of $ 20.0 million, as permitted by the Prior Atlas Operating LLCA, and the Company declared and paid a quarterly base dividend of $ 0.15 per share and a quarterly variable dividend of $ 0.05 per share of Old Atlas Class A common stock. The dividend and distribution, as applicable, was paid on August 17, 2023 to holders of record of Old Atlas Class A common stock and Operating Units, as applicable, as of the close of business on August 10, 2023 . In September 2023, Atlas Operating approved a distribution to its unitholders, the Company and Holdings, in the aggregate amount of $ 12.6 million for the payment of estimated U.S. federal income tax obligations, as permitted by the Prior Atlas Operating LLCA. To effect the payment of the distribution, Atlas Operating made a distribution of $ 7.2 million to the Company, which was remitted to the Internal Revenue Service. The related $ 5.4 million pro rata distribution was paid to Holdings. On October 30, 2023, the Company declared a dividend of $ 0.20 per share (base dividend of $ 0.15 per share and a variable dividend of $ 0.05 per share) of New Atlas Common Stock. The dividend will be payable on November 16, 2023 to holders of record of New Atlas Common Stock as of the close of business on November 9, 2023. Up-C Simplification On October 2, 2023, Old Atlas completed the previously announced Up-C Simplification contemplated by the Master Reorganization Agreement. Pursuant to the Master Reorganization Agreement, (a) PubCo Merger Sub merged with and into the Company, as a result of which (i) each share of Old Atlas Class A common stock then issued and outstanding was exchanged for one share of New Atlas Common Stock, (ii) all of the Old Atlas Class B common stock then issued and outstanding were surrendered and cancelled for no consideration and (iii) Old Atlas survived the PubCo Merger as a direct, wholly owned subsidiary of New Atlas; and (b) Opco Merger Sub merged with and into Atlas Operating, as a result of which (i) each Operating Unit then issued and outstanding, other than those Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock and (ii) Atlas Operating became a wholly owned subsidiary (partially direct and partially indirect through Old Atlas) of New Atlas. In connection with the Up-C Simplification: • each share of Old Atlas Class A common stock issued and outstanding immediately prior to the Effective Time was exchanged for one share of New Atlas Common Stock and the holders of Old Atlas Class A common stock became stockholders of New Atlas; • all of the Old Atlas Class B common stock issued and outstanding immediately prior to the Effective Time were surrendered and cancelled for no consideration; • each Operating Unit issued and outstanding immediately prior to the Effective Time, other than Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock, and the holders of such Operating Units became stockholders of New Atlas; • Old Atlas continues to hold all of the issued and outstanding Operating Units it held as of immediately prior to the Effective Time, such Operating Units were otherwise unaffected by the Up-C Simplification (including the Opco Merger), and such Operating Units, together with the Operating Units received by New Atlas in connection with the Opco Merger, constitute all of the Operating Units currently issued and outstanding; • Old Atlas became a direct, wholly owned subsidiary of New Atlas, and all of the Old Atlas Class A common stock then held by New Atlas were recapitalized into a single share; • as of the Effective Time, New Atlas assumed (a) the LTIP, (b) all awards of restricted stock units and performance share units, in each case, whether vested or unvested, that were then outstanding under the LTIP, (c) the grant notices and agreements evidencing such awards, and (d) the then remaining unallocated share reserve issuable under the LTIP; and the terms and conditions that were in effect immediately prior to the Up-C Simplification under each outstanding award assumed by New Atlas continue in full force and effect after the Up-C Simplification, with certain exceptions to reflect the completion of the Up-C Simplification, such as each award denominated with reference to shares of New Atlas Common Stock instead of Old Atlas Class A common stock and the performance share unit awards being in reference to performance of New Atlas instead of performance of Old Atlas (with respect to the portion of the applicable performance period following the Up-C Simplification); • as of the Effective Time, (a) New Atlas assumed Old Atlas’s existing Management Change in Control Severance Plan (and each participation agreement thereunder that was then outstanding) and (b) the terms and conditions of the director compensation program applicable to members of the board of directors of Old Atlas (and any committees thereof) were applied instead to members of the board of directors of New Atlas (and any committees thereof) (and any portion of such compensation to be granted in the form of equity-based awards will be granted in awards denominated with reference to shares of New Atlas Common Stock instead of Old Atlas Class A common stock); and • Old Atlas changed its name from “Atlas Energy Solutions Inc.” to “AESI Holdings Inc.,” and New Atlas changed its name from “New Atlas HoldCo Inc.” to “Atlas Energy Solutions Inc.” New Atlas was approved to have the shares of New Atlas Common Stock listed on the New York Stock Exchange under the ticker symbol “AESI,” the trading symbol previously used by Old Atlas. After completion of the Up-C Simplification, New Atlas replaced Old Atlas as the publicly held entity and, through its subsidiaries, will conduct all of the operations previously conducted by Old Atlas, and Old Atlas will remain the managing member of Atlas Operating. The foregoing description is not complete and is qualified in its entirety by reference to the Master Reorganization Agreement, a copy of which was filed as Exhibit 2.1 to this Quarterly Report on Form 10-Q. |
Redeemable Noncontrolling Inter
Redeemable Noncontrolling Interest | 9 Months Ended |
Sep. 30, 2023 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontrolling Interest | Note 9 – Redeemable Noncontrolling Interest The redeemable noncontrolling interest represents the Legacy Owners’ historical 42.2 % economic interest in Atlas Operating through ownership of Operating Units. In addition, the Legacy Owners historically owned all of Old Atlas’s non-economic Old Atlas Class B common stock. Each share of Old Atlas Class B common stock entitled its holder to one vote on all matters to be voted on by our stockholders, generally, but conferred no economic rights to dividends or distributions upon a liquidation or winding up of Old Atlas. The Legacy Owners’ historical 42.2 % economic interest in Atlas Operating through ownership of Operating Units is classified as redeemable noncontrolling interest on the condensed consolidated balance sheets as, pursuant to the Prior Atlas Operating LLC Agreement, holders of Operating Units had the right to cause Atlas Operating to acquire all or a portion of their Operating Units for, at Atlas Operating’s election, (i) shares of Old Atlas Class A common stock at a redemption ratio of one share of Old Atlas Class A common stock for each Operating Unit redeemed, subject to conversion rate adjustments for stock splits, stock dividends, reclassification and other similar transactions, or (ii) an equivalent amount of cash. The redeemable noncontrolling interest is recognized at the higher of (1) its initial fair value plus accumulated earnings associated with the noncontrolling interest or (2) the redemption value as of the balance sheet date. From the date of the IPO through September 30, 2023, we recorded adjustments to the value of the redeemable noncontrolling interest as presented in the table below: Redeemable Noncontrolling Interest Balance at March 13, 2023 (1) $ 771,345 Net income attribution post-IPO 66,190 $ 0.35 /unit distribution to Atlas Sand Operating, LLC unitholders ( 14,998 ) Other distributions to redeemable non-controlling interest unitholders ( 7,158 ) Redemption of operating units of Atlas Sand Operating, LLC for Class A common stock ( 13,640 ) Adjustment of redeemable noncontrolling interest to redemption amount (2) 185,412 Balance at September 30, 2023 $ 987,151 (1) Based on the Operating Units held by the Legacy Owners who also held 42,852,499 shares of Old Atlas Class B common stock and an Old Atlas Class A common stock price of $ 18.00 on the date on which we consummated the IPO. (2) Based on the Operating Units held by the Legacy Owners who also held 42,258,185 shares of Old Atlas Class B common stock and an Old Atlas Class A common stock 10-day volume-weighted average closing price of $ 23.36 on September 30, 2023. In connection with the Up-C Simplification, each Operating Unit issued and outstanding immediately prior to the Effective Time, other than Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock, and the holders of such Operating Units became stockholders of New Atlas, and all of the Old Atlas Class B common stock issued and outstanding immediately prior to the Effective Time were surrendered and cancelled for no consideration. See Note 8 – Stockholders Equity – Up-C Simplification for more information. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Note 10 – Stock-Based Compensation Long Term Incentive Plan On March 8, 2023, we adopted the LTIP for the benefit of employees, directors and consultants of the Company and its affiliates. The LTIP provides for the grant of all or any of the following types of awards: (1) incentive stock options qualified as such under U.S. federal income tax laws; (2) stock options that do not qualify as incentive stock options; (3) stock appreciation rights; (4) restricted stock awards; (5) restricted stock units (“RSUs”); (6) bonus stock; (7) dividend equivalents; (8) other stock-based awards; (9) cash awards; and (10) substitute awards. The shares to be delivered under the LTIP may be made available from (i) authorized but unissued shares, (ii) shares held as treasury stock or (iii) previously issued shares reacquired by us, including shares purchased on the open market. In connection with the closing of the Up-C Simplification, New Atlas assumed the LTIP as well as the outstanding awards granted under the LTIP, including all awards of RSUs and performance share units, in each case, whether or not vested, that were then outstanding under the LTIP, and each (i) RSU grant notice and RSU agreement and (ii) performance share unit grant notice and performance share unit agreement, in each case, evidencing then-outstanding awards under the LTIP. In connection with the assumption of the LTIP, the Company also assumed the remaining share reserves available for issuance under the LTIP, subject to applicable adjustments to relate to the New Atlas Common Stock. Subject to adjustment in accordance with the terms of the LTIP, 10,270,000 shares of New Atlas Common Stock have been reserved for issuance pursuant to awards under the LTIP. If an award under the LTIP is forfeited, settled for cash or expires without the actual delivery of shares, any shares subject to such award will again be available for new awards under the LTIP. The LTIP will be administered by the Compensation Committee (the “Compensation Committee”) of the board of directors of the Company (the “Board”). On September 30, 2023, 9,504,057 shares of Old Atlas Class A common stock were available for future grants. We account for the awards granted under the LTIP as compensation cost measured at the fair value of the award on the date of grant. Restricted Stock Unit s RSUs represent the right to receive shares of New Atlas Common Stock at the end of the vesting period in an amount equal to the number of RSUs that vest. The granted RSUs vest and become exercisable with respect to employees in three equal installments starting on the first anniversary of the date of grant and, with respect to directors, on the one-year anniversary of the date of grant, so long as the participant either remains continuously employed or continues to provide services to Board, as applicable. The RSUs are subject to restrictions on transfer and are generally subject to a risk of forfeiture if the award recipient ceases providing services to the Company prior to the date the award vests. If the participant’s employment with or service to the Company is terminated for cause or without good reason prior to the vesting of all of the RSUs, and unless such termination is a “Qualifying Termination” or due to a “Change in Control” as defined in the applicable RSU agreement, any unvested RSUs will generally terminate automatically and be forfeited without further notice and at no cost to the Company. In the event the Company declares and pays a dividend in respect of its outstanding shares of common stock and, on the record date for such dividend, the participant holds RSUs that have not been settled, we will record the amount of such dividend in a bookkeeping account and pay to the participant an amount in cash equal to the cash dividends the participant would have received if the participant was the holder of record, as of such record date, of a number of shares of common stock equal to the number of RSUs held by the participant that had not been settled as of such record date, such payment to be made on or within 60 days following the date on which such RSUs vest. The stock-based compensation expense of such RSUs was determined using the closing prices on March 13, 2023, May 22, 2023 and September 22, 2023, the dates of grant, of $ 15.99 , $ 17.72 and $ 22.68 , applied to the total number of 260,722, 28,217 and 3,197 RSUs granted, respectively. We account for forfeitures as they occur. We recognized stock-based compensation related to RSUs of $ 0.6 million and $ 1.4 million for the three and nine months ended September 30, 2023, respectively. C hanges in non-vested RSUs outstanding under the LTIP during the nine months ended September 30, 2023 were as follows: Number of Units Weighted Average Non-vested at December 31, 2022 — $ — Granted 292,136 $ 16.23 Vested ( 25,000 ) $ 15.99 Forfeited — $ — Non-vested at September 30, 2023 267,136 $ 16.25 There was approximately $ 3.4 million of unrecognized compensation expense relating to outstanding RSUs as of September 30, 2023. The unrecognized compensation expense will be recognized on a straight-line basis over the weighted average remaining vesting period of 1.3 years. Performance Share Units Performance share units (“PSUs”) represent the right to receive one share of common stock multiplied by the number of PSUs that become earned, and the number of PSUs that may vest range from 0 % to 200 % of the Target PSUs (as defined in the Performance Share Unit Grant Agreement governing the PSUs (the “PSU Agreement”)), subject to the Compensation Committee’s discretion to increase the ultimate number of vested PSUs above the foregoing maximum level. Each PSU also includes a tandem dividend equivalent right, which is a right to receive an amount equal to the cash dividends made with respect to a share of common stock during the Performance Period (as defined in the PSU Agreement), which will be adjusted to correlate to the number of PSUs that ultimately become vested pursuant to the PSU Agreement. 490,167 PSUs (based on target) were granted on March 13, 2023 (the “2023 PSUs”). The Performance Goals (as defined in the PSU Agreement) for the 2023 PSUs are based on a combination of Return on Capital Employed (“ROCE”) and “Relative TSR” (each, as defined in the PSU Agreement), with 25% weight applied to ROCE and 75% weight applied to Relative TSR, each as measured during the three-year Performance Period ending December 31, 2025. The vesting level is calculated based on the actual total stockholder return achieved during the Performance Period. The fair value of such PSUs was determined using a Monte Carlo simulation and will be recognized over the applicable Performance Period. The Monte Carlo simulation model utilizes multiple input variables that determine the probability of satisfying the market condition stipulated in the award to calculate the fair value of the award. Expected volatilities in the model were estimated using a historical period consistent with the Performance Period of approximately three years. The risk-free interest rate was based on the United States Treasury rate for a term commensurate with the expected life of the grant. We recognized stock-based compensation related to PSU s of $ 0.8 mil lion and $ 2.0 million for the three and nine months ended September 30, 2023. Changes in non-vested PSUs outstanding under the LTIP during the nine months ended September 30, 2023 were as follows: Number of Units Weighted Average Non-vested at December 31, 2022 — $ — Granted 490,167 $ 20.19 Vested ( 584 ) $ 20.19 Forfeited ( 16,360 ) $ 20.19 Non-vested at September 30, 2023 473,223 $ 20.19 There was approximately $ 7.7 million of unrecognized compensation expense relating to outstanding PSUs as of September 30, 2023. The unrecognized compensation expense will be recognized on a straight-line basis over the weighted average remaining vesting period of 2.3 years. Atlas LLC Incentive Plan and ASMC Incentive Plan Prior to the IPO closing date, the Company recognized unit-based compensation expense for awards granted under two long-term incentive plans, the Atlas Sand Management Company, LLC Long-Term Incentive Plan (the “ASMC Plan”) and the Atlas Sand Company, LLC Long-Term Incentive Plan (the “ASCo Plan”). The ASMC Plan was adopted on September 15, 2017, by ASMC for officers, employees, directors, managers and consultants of ASMC (the “ASMC Participants”). The ASCo Plan was adopted by Atlas LLC on December 15, 2017, for officers, employees, directors, managers, consultants or other advisors of Atlas LLC (the “ASCo Participants”). On May 28, 2018, Atlas LLC adopted the Atlas Sand Company, LLC Amended and Restated Long-Term Incentive Plan that reduced the authorized available awards to be issued under the ASCo Plan from 149,425 to 100,000 . The ASCo Plan consists of equity grants of Class P units made to ASCo Participants at the discretion of the plan administrator. Pursuant to the terms of the ASCo Plan, to the extent that an award is canceled, any and all Class P units that are canceled and repurchased will be available again for new awards under the ASCo Plan. The Company has applied the guidance of FASB Interpretation 44, which establishes an accounting model whereby equity awards granted by a parent company to employees of a subsidiary are recognized in the financial statements of the subsidiary. A summary of Atlas LLC’s Class P unit activity is as follows: Number of Class Weighted Average Non-vested at December 31, 2022 3,533 $ 151.57 Granted — $ — Vested ( 3,533 ) $ 151.57 Forfeited — $ — Non-vested at September 30, 2023 — $ — We account for each tranche of the unit awards as compensatory awards in accordance with ASC 718, and as such, compensation expense is recognized over the service condition vesting period based on the grant date fair values using a graded vesting methodology. To determine grant date fair value, we valued these unit awards utilizing a Monte Carlo option pricing model, to take into consideration the probability of a market condition being met. This methodology involves making assumptions for the expected time to liquidity, volatility and risk-free rate. We estimated expected volatility based on a 50/50 blend of historical and implied volatility. The risk-free interest rate is based on the yield on U.S. government bonds for a period commensurate with the expected term. The expected term is based on time to the expected exit date as of the valuation date based on the probability weighted average of exit scenario terms. We applied a discount to reflect the lack of marketability due to the absence of an active market for the units. Further, we assumed no expected dividend yield. For the three and nine months ended September 30, 2023, we recognized no unit-based compensation expense and $ 0.2 million of unit-based compensation expense related to awards in the ASCo Plan, respectively, as compared to $ 0.1 million and $ 0.3 million for the three and nine months ended September 30, 2022, respectively. For the three and nine months ended September 30, 2023, the Company recognized no unit-based compensation expense and $ 0.1 million of unit-based compensation expense related to awards in the ASMC Plan, respectively, as compared to $ 0.1 million and $ 0.2 million for the three and nine months ended September 30, 2022, respectively. As of September 30, 2023, there were no unrecognized unit-based compensation expense amounts related to the ASCo Plan and ASMC Plan. |
Earnings per Share
Earnings per Share | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Note 11 – Earnings per Share Basic earnings per share (“EPS”) measures the performance of an entity over the reporting period. Diluted earnings per share measures the performance of an entity over the reporting period while giving effect to all potentially dilutive shares of common stock that were outstanding during the period. The Company uses the treasury stock method to determine the potential dilutive effect of vesting of its outstanding RSUs and PSUs. The Company does not use the two-class method as the Old Atlas Class B common stock, the unvested RSUs, and PSU awards are nonparticipating securities. The issuance of Old Atlas Class A common stock in exchange for Operating Units held by the Legacy Owners (and their corresponding shares of Old Atlas Class B common stock) did not have a dilutive effect on EPS and was not recognized in dilutive earnings per share calculations as of September 30, 2023. Please see Note 2 - Summary of Significant Accounting Policies -Earnings Per Share for more information. There were no shares of Old Atlas Class A common stock or Old Atlas Class B common stock outstanding for the three and nine months ended September 30, 2022, and therefore no earnings per share information has been presented for those periods. For the three and nine months ended September 30, 2023, the Company’s EPS calculation includes only its share of net income for the period subsequent to the IPO, and omits income prior to the IPO. In addition, the basic weighted average shares outstanding calculation is based on the actual days during which the shares were outstanding date of our IPO through September 30, 2023. The following table reflects the allocation of net income to common stockholders and EPS computations for the period indicated based on a weighted average number of shares of common stock outstanding for the period: Three Months Ended Nine Months Ended September 30, September 30, 2023 2023 Numerator: Net income $ 56,327 $ 190,443 Less: Pre-IPO net income attributable to Atlas Sand Company, LLC - 54,561 Less: Net income attributable to redeemable noncontrolling interest 26,887 66,190 Net income attributable to Atlas Energy Solutions Inc. $ 29,440 $ 69,692 Denominator: Basic weighted average shares outstanding 57,237 57,189 Dilutive potential of restricted stock units 110 77 Dilutive potential of performance share units 581 480 Diluted weighted average shares outstanding (1) $ 57,928 $ 57,746 Basic EPS attributable to Old Atlas Class A common stockholders $ 0.51 $ 1.22 Diluted EPS attributable to Old Atlas Class A common stockholders (1) $ 0.51 $ 1.21 (1) Shares of Old Atlas Class A common stock issued in exchange for Operating Units did not have a dilutive effect on EPS and were not included in the EPS calculation. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 12 – Income Taxes The Company’s predecessor, Atlas LLC, is a limited liability company that elected to be treated as a partnership for income tax purposes and, therefore, is not subject to U.S. federal income tax. Rather, the U.S. federal income tax liability with respect to the taxable income of Atlas LLC is passed through to its owners. However, Atlas LLC’s operations located in Texas are subject to an entity-level tax, the Texas margin tax, at a statutory rate of up to 0.75 % of income that is apportioned to Texas. The tax expense or benefit associated with the interim period is computed using the most recent estimated tax rate applied to the year-to-date revenues less cost of sales. Atlas Inc. is a corporation and is subject to U.S. federal, state and local income taxes. In March 2023, Atlas Inc. completed its initial public offering of 18,000,000 shares of Old Atlas Class A common stock at a price to the public of $ 18.00 per share. The tax implications of the Reorganization, the IPO and the tax impact of Atlas Inc.’s status as a taxable corporation subject to U.S. federal income tax have been reflected in the accompanying Financial Statements. On March 13, 2023, the date on which we closed the IPO, a corresponding deferred tax liability of approximately $ 27.5 million was recorded associated with the differences between the tax and book basis of the investment in Atlas LLC. The offset of the deferred tax liability was recorded to additional paid-in capital. The effective combined U.S. federal and state income tax rate for the three and nine months ended September 30, 2023 was 9.7 %. During the three and nine months ended September 30, 2023, we recognized an income tax expense of $ 7.6 million and $ 20.4 million, respectively. Total income tax expense for the three and nine months ended September 30, 2023 differed from amounts computed by applying the U.S. federal statutory tax rate of 21 % due to the net income attributable to Atlas LLC prior to the date of our IPO, net income attributable to noncontrolling interest subsequent to the IPO, and state taxes (net of the anticipated federal benefit). During the three and nine months ended September 30, 2022, we recognized an income tax expense of $ 0.6 million and $ 1.4 million, respectively. |
Related-Party Transactions
Related-Party Transactions | 9 Months Ended |
Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Note 13 – Related-Party Transactions Brigham Oil & Gas, LLC Atlas LLC has sold proppant to a customer, Brigham Oil & Gas, LLC (“Brigham Oil & Gas”), which is controlled by our Executive Chairman and Chief Executive Officer, Bud Brigham. For the three and nine months ended September 30, 2023 and 2022, the Company made no sales to this related party. As of September 30, 2023 and December 31, 2022, we had no outstanding accounts receivable and $ 0.9 million outstanding accounts receivable with Brigham Oil & Gas, respectively. Brigham Land Management LLC Brigham Land Management LLC (“Brigham Land”) provides us with landman services for certain of our projects and initiatives. The services are provided on a per hour basis at market prices. Brigham Land is owned and controlled by Vince Brigham, an advisor to the Company and the brother of our Executive Chairman and Chief Executive Officer, Bud Brigham. For the three and nine months ended September 30, 2023, we made aggregate payments to Brigham Land equal to approximately $ 0.3 million and $ 0.8 million, respectively. For the three and nine months ended September 30, 2022, we made aggregate payments to Brigham Land equal to approximately $ 0.3 million and $ 0.8 million, respectively. As of September 30, 2023 and December 31, 2022, our outstanding accounts payable to Brigham Land was $ 0.1 million and $ 0.1 million, respectively. Brigham Earth, LLC Brigham Earth, LLC (“Brigham Earth”) provides us with professional and consulting services as well as access to certain information and software systems. Brigham Earth is owned and controlled by our Executive Chairman and Chief Executive Officer, Bud Brigham. For the three and nine months ended September 30, 2023, our aggregate payments to Brigham Earth for these services were de minimus and approximately $ 0.2 million, respectively. For the three and nine months ended September 30, 2022, we made aggregate payments to Brigham Earth for these services equal to approximately $ 0.2 million and $ 0.6 million, respectively. As of September 30, 2023 and December 31, 2022, we had de minimis accounts payable and $ 0.1 million outstanding accounts payable to Brigham Earth, respectively. Anthem Ventures, LLC Anthem Ventures, LLC (“Anthem Ventures”) provides us with transportation services. Anthem Ventures is owned and controlled by our Executive Chairman and Chief Executive Officer, Bud Brigham. For the three and nine months ended September 30, 2023, our aggregate payments to Anthem Ventures for these services were de minimus and approximately $ 0.2 million, respectively. For the three and nine months ended September 30, 2022, we made de minimis aggregate payments to Anthem Ventures for these services. As of September 30, 2023 and December 31, 2022, we had $ 0.1 million outstanding accounts payable and no outstanding accounts payable balance with Anthem Ventures. In a Good Mood In a Good Mood, LLC (“In a Good Mood”) provides the Company with access, at cost, to reserved space in the Moody Center in Austin, Texas for concerts, sporting events and other opportunities as a benefit to our employees and for business entertainment. In a Good Mood is owned and controlled by our Executive Chairman and Chief Executive Officer, Bud Brigham. For the three and nine months ended September 30, 2023 and 2022, we made $ 0.1 million of payments to In a Good Mood for these services. As of September 30, 2023 and December 31, 2022, we did no t have an outstanding accounts payable balance with this related party. Permian Dunes Holding Company, LLC Refer to Note 7 – Commitments and contingencies for disclosures related to the Company’s royalty agreement and mining agreement with Permian Dunes Holding Company, LLC, a related party. Reorganization Refer to Note 1 – Business and Organization for disclosures related to the Company’s transactions with affiliates including entities controlled by Bud Brigham. Registration Rights Agreement In connection with the closing of the IPO, we entered into a registration rights agreement with certain Legacy Owners (the “Original Registration Rights Agreement”) covering, in the aggregate, approximately 38.4 % of the Old Atlas Class A and Class B common stock on a combined basis. Pursuant to the Original Registration Rights Agreement, we agreed to register under the U.S. federal securities laws the offer and resale of shares of Old Atlas Class A common stock (including shares issued in connection with any redemption of Operating Units) by such Legacy Owners or certain of their respective affiliates or permitted transferees under the Original Registration Rights Agreement. These registration rights will be subject to certain conditions and limitations. On October 2, 2023, the Company entered into an amended and restated registration rights agreement (the “A&R Registration Rights Agreement”) with New Atlas and certain stockholders identified on the signature pages thereto. The A&R Registration Rights Agreement was entered into in order to, among other things, provide for the assumption of Old Atlas’s obligations thereunder by New Atlas. The A&R Registration Rights Agreement is substantially similar to the Original Registration Rights Agreement, but contains certain administrative and clarifying changes to reflect the transition from a dual class capital structure to a single class of common stock. We will generally be obligated to pay all registration expenses in connection with these registration obligations, regardless of whether a registration statement is filed or becomes effective. The foregoing description does not purport to be complete and is qualified in Its entirety by reference to the full text of the A&R Registration Rights Agreement, which is attached as Exhibit 4.1 to this Report. Stockholders’ Agreement In connection with the closing of the IPO, we entered into a stockholders’ agreement (the “Original Stockholders’ Agreement”) with certain of our Legacy Owners (the “Principal Stockholders”). Among other things, the Original Stockholders’ Agreement provides our Executive Chairman and Chief Executive Officer, Bud Brigham, the right to designate a certain number of nominees for election or appointment to our Board as described below according to the percentage of common stock held by such Principal Stockholders. Pursuant to the Original Stockholders’ Agreement, we will be required to take all necessary actions, to the fullest extent permitted by applicable law (including with respect to any fiduciary duties under Delaware law), to cause the election or appointment of the nominees designated by Mr. Brigham or his affiliates, and each of the Principal Stockholders will agree to cause its respective shares of common stock to be voted in favor of the election of each of the nominees designated by Mr. Brigham or his affiliates. Mr. Brigham or his affiliates will be entitled to designate the replacement for any of his respective board designees whose board service terminates prior to the end of such director’s term. In addition, the Original Stockholders’ Agreement provides that for so long as Mr. Brigham or any of his affiliates is entitled to designate any members of our Board, we will be required to take all necessary actions to cause each of the audit committee, compensation committee and nominating and governance committee of our Board to include in its membership at least one director designated by Mr. Brigham or his affiliates, except to the extent that such membership would violate applicable securities laws or stock exchange rules. Furthermore, so long as the Principal Stockholders collectively beneficially own at least a majority of the outstanding shares of our common stock, we have agreed not to take, and will cause our subsidiaries not to take, the following actions (or enter into an agreement to take such actions) without the prior consent of Mr. Brigham or his affiliates, subject to certain exceptions: • adopting or proposing any amendment, modification or restatement of or supplement to our certificate of incorporation or bylaws; • increasing or decreasing the size of our Board; or • issuing any equity securities that will rank senior to our common stock as to voting rights, dividend rights or distributions rights upon liquidation, winding up or dissolution of the Company. On October 2, 2023, Old Atlas entered into an amended and restated stockholders’ agreement (the “A&R Stockholders’ Agreement”) with New Atlas and certain of the Principal Stockholders. The A&R Stockholders’ Agreement was entered into in order to, among other things, provide for the assumption of Old Atlas’s obligations thereunder by New Atlas. The A&R Stockholders’ Agreement is substantially similar to the Original Stockholders’ Agreement, but contains certain administrative and clarifying changes to reflect the transition from a dual class capital structure to a single class of common stock. The foregoing description is not complete and is qualified in its entirety by reference to the full text of the A&R Stockholders’ Agreement, which is attached as Exhibit 10.1 to this Report. Up-C Simplification Refer to Note 1 – Business and Organization and Note 8 – Stockholders Equity for disclosures related to the Company’s Up-C Simplification. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements (the “Financial Statements”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and SEC requirements. All adjustments necessary for a fair presentation of the Financial Statements have been included. Such adjustments are of a normal, recurring nature. These condensed consolidated financial statements include the accounts of New Atlas, Old Atlas, Atlas Operating, Atlas LLC, and Atlas LLC’s wholly owned subsidiaries: Atlas Sand Employee Company, LLC; Atlas OLC Employee Company, LLC; Atlas Construction Employee Company, LLC; Atlas Sand Employee Holding Company, LLC; Fountainhead Logistics Employee Company, LLC; Atlas Sand Construction, LLC; OLC Kermit, LLC; OLC Monahans, LLC; Fountainhead Logistics, LLC; and Fountainhead Transportation Services, LLC. The results of operations for the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any other period. The Financial Statements and these notes should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2022 included within the Company’s prospectus, dated September 11, 2023, filed with the SEC pursuant to Rule 424(b) under the Securities Act on September 12, 2023 in connection with our Up-C Simplification (the “Up-C Simplification Prospectus”). As discussed in Note 1 - Business and Organization , as a result of our IPO and the Reorganization and prior to the Up-C Simplification, Old Atlas became the managing member of Atlas Operating and consolidated entities in which it had a controlling financial interest through the end of the reporting period. The Reorganization was considered a transaction between entities under common control. As a result, the financial statements for periods prior to the IPO and the Reorganization have been adjusted to combine the previously separate entities for presentation purposes. However, Old Atlas and Atlas Operating had no operations or assets and liabilities prior to our IPO. As such, for periods prior to the completion of our IPO, the consolidated financial statements represent the historical financial position and results of operations of Atlas LLC and its subsidiaries. For periods after the completion of our IPO through the end of the reporting period, the financial position and results of operations include those of Old Atlas and report the redeemable noncontrolling interest related to the portion of Operating Units not owned by Old Atlas. Up-C Simplification During the fourth quarter 2023, for accounting purposes, the Up-C Simplification will be treated as a transaction between entities under common control of an acquisition of noncontrolling interest. Accordingly, the fourth quarter 2023 consolidated financial position and results of operations of the Company will be included in the consolidated financial statements of New Atlas on the same basis as currently presented except for the acquisition of noncontrolling interest that will be accounted for as a capital transaction with no resulting gain or loss. |
Consolidation | Consolidation The Financial Statements include the accounts of the Company and controlled subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of the Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities at the date of the Financial Statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates used in the preparation of these Financial Statements include, but are not limited to: the sand reserves and their impact on calculating the depletion expense under the units-of-production method; the depreciation and amortization associated with property, plant and equipment; stock and unit-based compensation; spare parts inventory reserve; collectability of receivables; certain liabilities; and income tax expense. We base estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. |
Cash and cash equivalents | Cash and cash equivalents Cash and cash equivalents consist of all highly liquid investments that are readily convertible into cash and have original maturities of three months or less when purchased. As of September 30, 2023, we have deposits of $ 119.4 million in an Insured Cash Sweep (“ICS”) Deposit Placement Agreement within IntraFi Network LLC facilitated by our bank. The ICS program provides the Company with access to FDIC insurance for our total cash held within the ICS. We had an additional $ 112.3 million in 2-month and 3-month United States Treasury Bills which are fully backed by the United States as of September 30, 2023. We place our remaining cash deposits with high-credit-quality financial institutions. At times, a portion of our cash may be uninsured or in deposit accounts that exceed or are not covered under the Federal Deposit Insurance Corporation limit. |
Accounts Receivable and Allowance for Credit Losses | Accounts Receivable and Allowance for Credit Losses Accounts receivable are recorded at cost when earned and represent claims against third parties that will be settled in cash. These receivables generally do not bear interest. The carrying value of our receivables, net of allowance for credit losses, represents the estimated collectable amount. If events or changes in circumstances indicate specific receivable balances may be impaired, further consideration is given to our ability to collect those balances and the allowance is adjusted accordingly. We perform credit evaluations of new customers, and sometimes require deposits and prepayments, to mitigate credit risk. When it is probable that all or part of an outstanding balance will not be collected, we establish an allowance for credit losses. On January 1, 2023, we adopted Accounting Standards Update (“ASU”) 2016-13, Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments, which replaced the prior incurred loss impairment model with an expected credit loss impairment model for financial instruments, including accounts receivable. The adoption of ASU 2016-13 did not result in a material cumulative-effect adjustment to retained earnings on January 1, 2023. We are exposed to credit losses primarily through sales of products and services. We analyze accounts receivable on an individual customer and overall basis through review of historical collection experience and current aging status of our customer accounts. We also consider the financial condition and economic environment of our customers in evaluating the need for an allowance. During the three and nine months ended September 30, 2023, we recognized de minimis allowance for credit losses. As of September 30, 2023 and December 31, 2022, we had de minimis allowance for credit losses, which is included in accounts receivable on the condensed consolidated balance sheets. As of September 30, 2023, three customers represented 20 %, 14 %, and 11 % of our outstanding accounts receivable balance. As of December 31, 2022, two customers represented 19 % and 13 % of our outstanding accounts receivable balance. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. The amounts reported in the balance sheets as current assets or liabilities, including cash and cash equivalents, accounts receivable, spare parts inventories, inventories, prepaid expenses and other current assets, accounts payable, accrued liabilities and deferred revenues approximate fair value due to the short-term maturities of these instruments. As of the dates indicated, our long-term debt consisted of the following (in thousands): At September 30, 2023 At December 31, 2022 Carrying Value Fair Value Carrying Value Fair Value Valuation Technique Financial liabilities Outstanding principal amount of the 2023 Term Loan Credit Facility $ 172,511 $ 181,003 $ 147,174 $ 146,837 Level 2 – Market Approach Our credit agreement with Stonebriar Commercial Finance LLC (“Stonebriar”) pursuant to which Stonebriar extended a $ 180.0 million single advance seven-year term loan credit facility (the "2023 Term Loan Credit Facility") bears interest at a fixed rate of 9.50 %, where its fair value will fluctuate based on changes in interest rates and credit quality. As of September 30, 2023 and December 31, 2022, the fair value of long-term debt has been determined by discounting the future cash flows using current market interest rates for similar financial instruments. These inputs are not quoted prices in active markets, but they are either directly or indirectly observable; therefore, they are classified as Level 2 inputs. See Note 6 - Debt for discussion of the credit agreement governing the 2023 Term Loan Credit Facility. |
Stock-Based Compensation | Stock-Based Compensation We account for stock-based compensation, including grants of incentive units, restricted stock awards, time-based restricted stock units and performance share units, under the measurement and recognition provisions of Accounting Standards Codification (“ASC”) 718, Compensation – Stock Compensation (“ASC 718”). We account for stock and unit-based compensation by amortizing the fair value of the stock or units, which is determined at the grant date, on a straight-line basis unless the tranche method is required. We account for forfeitures as they occur and reverse any previously recognized stock or unit-based compensation expense for the unvested portion of the awards that were forfeited. |
Earnings Per Share | Earnings Per Share We use the treasury stock method to determine the potential dilutive effect of outstanding restricted stock units and performance share units. We evaluated the potential dilutive effect of Old Atlas Class B common stock using the “if-converted” method, noting conversion of Old Atlas Class B common stock to Class A common stock would not have a dilutive impact to earnings per share. Each share of Old Atlas Class B common stock was issued in conjunction with and only as a consequence of the issuance by Atlas Operating of an Operating Unit to a securityholder other than Old Atlas. Old Atlas is a holding company the only assets of which are equity interests in Atlas Operating. For the reporting period, the earnings of Atlas Operating per unit were attributable to Old Atlas and the other Legacy Owners, as the holders of the outstanding Operating Units. Because each holder of Operating Units other than Old Atlas also held one share of Old Atlas Class B common stock, and because Old Atlas consolidated the results of operations of Atlas Operating, the earnings per Operating Unit attributable to the Legacy Owners for the reporting period were derivatively attributable to the corresponding shares of Old Atlas Class B common stock held by such Legacy Owners. For that reason, when a Legacy Owner determined to exercise its Redemption Right (as defined below in Note 8 - Stockholders' Equity ) and exchange an Operating Unit (and corresponding share of Old Atlas Class B common stock), for a share of Old Atlas Class A common stock, there was not a dilutive impact to the earnings per share of the Old Atlas Class A common stock. In connection with the Up-C Simplification, each Operating Unit issued and outstanding immediately prior to the Effective Time, other than Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock, and the holders of such Operating Units became stockholders of New Atlas, and all of the Old Atlas Class B common stock issued and outstanding immediately prior to the Effective Time were surrendered and cancelled for no consideration. This exchange is not expected to have a dilutive impact on the fourth quarter 2023 earnings per share. See Note 8 – Stockholders Equity – Up-C Simplification for more information. As a result of the IPO, the presentation of earnings per share for the periods prior to the IPO is not meaningful and only earnings per share for periods subsequent to the IPO are presented herein. See Note 11 – Earnings Per Share for additional information. |
Redeemable Noncontrolling Interest | Redeemable Noncontrolling Interest We account for the Legacy Owners’ historical 42.2 % economic interest in Atlas Operating through ownership of Operating Units as redeemable noncontrolling interest. The redeemable noncontrolling interest is recognized at the higher of (1) its initial fair value plus accumulated earnings associated with the redeemable noncontrolling interest or (2) the redemption value as of the balance sheet date. At September 30, 2023, the redeemable noncontrolling interest was recorded based on the redemption value as of the balance sheet date as this amount was higher than the its initial fair value plus accumulated income associated with the redeemable noncontrolling interest at September 30, 2023. The redemption amount is based on the 10-day volume-weighted average closing price of shares of Old Atlas Class A common stock at the end of the reporting period. Changes in the redemption value were recognized immediately as they occurred, as if the end of the reporting period was also the redemption date for the instrument, with an offsetting entry to retained earnings, or additional paid-in capital in the absence of retained earnings and further to accumulated deficit in the absence of additional paid in capital. For more information, refer to Note 9 - Redeemable Noncontrolling Interest. In connection with the Up-C Simplification, each Operating Unit issued and outstanding immediately prior to the Effective Time, other than Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock, and the holders of such Operating Units became stockholders of New Atlas, and all of the Old Atlas Class B common stock issued and outstanding immediately prior to the Effective Time were surrendered and cancelled for no consideration. See Note 8 – Stockholders Equity – Up-C Simplification for more information. |
IncomeTaxes | Income Taxes For the purposes of this discussion, references to “Atlas Inc.” are to Old Atlas for reporting periods prior to the completion of the Up-C Simplification (the “Closing”), and to New Atlas following the Closing. Atlas Inc. is a corporation and it is subject to U.S. federal, state and local income taxes. The tax implications of the Reorganization referenced in Note 1 - Business and Organization and the tax impact of the Company’s status as a taxable corporation subject to U.S. federal, state and local income taxes have been reflected in the accompanying Financial Statements. Atlas Inc. accounts for income taxes using the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled pursuant to the provisions of ASC 740, Income Taxes. The effect on deferred tax assets and liabilities of a change in tax rate is recognized in earnings in the period that includes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts more likely than not to be realized. Atlas Inc. computes its quarterly taxes under the effective tax rate method based on applying an anticipated annual effective rate to its year-to-date income, except for discrete items. Income taxes for discrete items are computed and recorded in the period that the specific transaction occurs. Atlas LLC, the Company’s predecessor, was organized as a limited liability company. As a limited liability company, Atlas LLC elected to be treated as a partnership for income tax purposes and, therefore, is not subject to U.S. federal income tax. Rather, the U.S. federal income tax liability with respect to the taxable income of our predecessor was passed through to its owners. We evaluate the uncertainty in tax positions taken or expected to be taken in the course of preparing the condensed consolidated financial statements to determine whether the tax positions are more likely than not of being sustained by the applicable tax authority. However, the conclusions regarding the evaluation are subject to review and may change based on factors including, but not limited to, ongoing analysis of tax laws, regulations, and interpretations thereof. As of September 30, 2023 and December 31, 2022, we did no t have any liabilities for uncertain tax positions or gross unrecognized tax benefits. Our income tax returns from 2018, 2019, 2020, 2021 and 2022 are open to examinations by U.S. federal, state or local tax authorities. We cannot predict or provide assurance as to the ultimate outcome of any existing or future examinations. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Rate Reform – In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional guidance for a limited time to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. The amendments apply only to contracts and hedging relationships that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform. These amendments are effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. In December 2022, FASB issued ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848. ASU 2022-06 amended ASU 2020-04 and deferred the sunset date of Topic 848 from December 31, 2022, to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. As described in Note 6 - Debt, our previous asset-based loan credit facility (the “2018 ABL Credit Facility”) was terminated on February 22, 2023. The 2018 ABL Credit Facility was our only material agreement affected by reference rate reform as of September 30, 2023. We will continue to evaluate the impact of this standard on the Financial Statements and do not believe it will have a material impact on the Financial Statements. Financial Instruments – In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326), which amended the guidance on the impairment of financial instruments. The standard added an impairment model, referred to as current expected credit loss, which is based on expected losses rather than incurred losses. The standard applies to most debt instruments, trade receivables, lease receivables, reinsurance receivables, financial guarantees and loan commitments. Under the guidance, companies are required to disclose credit quality indicators disaggregated by year of origination for a five-year period. In May 2019, ASU 2016-13 was subsequently amended by ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments—Credit Losses, ASU 2019-05, Financial Instruments—Credit Losses (Topic 326): Targeted Transition Relief. The new guidance became effective for fiscal years beginning after December 15, 2022. We adopted ASU 2016-13 on January 1, 2023. ASU 2016-13 was applied using a modified retrospective approach, with a cumulative-effect adjustment to the opening balance of retained earnings as of the adoption date. We analyzed trade accounts receivable on an individual customer and overall basis through review of historical collection experience and current aging status of our customer accounts. We also consider the financial condition and economic environment of our customers in evaluating the need for an allowance. There was no material cumulative impact of adoption in the opening balance of retained earnings as of January 1, 2023. See Accounts Receivable and Allowance for Credit Losses discussed within this Note. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Summary of Fair Values and Carrying Values of Long-Term Debt | As of the dates indicated, our long-term debt consisted of the following (in thousands): At September 30, 2023 At December 31, 2022 Carrying Value Fair Value Carrying Value Fair Value Valuation Technique Financial liabilities Outstanding principal amount of the 2023 Term Loan Credit Facility $ 172,511 $ 181,003 $ 147,174 $ 146,837 Level 2 – Market Approach |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Inventory, Net [Abstract] | |
Schedule of Inventories | Inventories consisted of the following (in thousands): September 30, 2023 December 31, 2022 Raw materials $ 531 $ 290 Work-in-process 2,924 4,825 Finished goods 506 499 Inventories $ 3,961 $ 5,614 |
Property, Plant and Equipment_2
Property, Plant and Equipment, Net (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Components of Property, Plant and Equipment, Net | Property, plant and equipment, net, consisted of the following (in thousands): September 30, 2023 December 31, 2022 Plant facilities associated with productive, depletable properties $ 244,464 $ 243,613 Plant equipment 351,583 251,122 Land 3,009 3,009 Furniture and office equipment 2,267 1,407 Computer and network equipment 1,648 1,648 Buildings and leasehold improvements 32,382 25,402 Logistics equipment 44,647 1,591 Construction in progress 271,789 111,711 Property, plant and equipment 951,789 639,503 Less: Accumulated depreciation and depletion ( 122,792 ) ( 97,979 ) Property, plant and equipment, net $ 828,997 $ 541,524 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Schedule of Lease Cost | The components of lease cost were as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2023 2022 2023 2022 Finance lease cost: Amortization of right-of-use assets $ 846 $ 515 $ 4,286 $ 971 Interest on lease liabilities 345 167 1,742 286 Operating lease cost 289 227 823 839 Variable lease cost 160 173 458 515 Short-term lease cost 5,893 3,740 18,255 7,130 Total lease cost $ 7,533 $ 4,822 $ 25,564 $ 9,741 |
Schedule of Supplemental Cash Flow and Other Information Related to Leases | Supplemental cash flow and other information related to leases were as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2023 2022 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 443 $ 290 $ 1,018 $ 1,016 Operating cash outflows from finance leases $ 345 $ 167 $ 1,742 $ 286 Financing cash outflows from finance leases $ 232 $ 310 $ 1,932 $ 703 Right-of-use assets obtained in exchange for new lease liabilities: Operating leases $ — $ — $ 559 $ 5,384 Finance leases $ 4,187 $ 7,262 $ 25,063 $ 11,213 |
Schedule of Lease Terms and Discount Rates | Lease terms and discount rates as of September 30, 2023 and December 31, 2022 are as follows: September 30, 2023 December 31, 2022 Weighted-average remaining lease term: Operating leases 3.9 years 4.5 years Finance leases 3.6 years 5.3 years Weighted-average discount rate: Operating leases 4.6 % 4.3 % Finance leases 5.0 % 9.4 % |
Schedule of Future Minimum Lease Commitments of Operating and Finance Leases Liabilities | Future minimum lease commitments as of September 30, 2023 are as follows (in thousands): Finance Operating Remainder of 2023 $ 74 $ 293 2024 176 1,443 2025 90 1,474 2026 90 1,414 2027 90 815 Thereafter 22 11 Total lease payments 542 5,450 Less imputed interest 52 465 Total $ 490 $ 4,985 |
Schedule Of Supplemental Balance Sheet Related To Lease | Supplemental balance sheet information related to our leases as of September 30, 2023 and December 31, 2022 was as follows (in thousands): Classification September 30, 2023 December 31, 2022 Operating Leases Current operating lease liabilities Other current liabilities $ 1,227 $ 1,082 Noncurrent operating lease liabilities Other long-term liabilities $ 3,758 $ 4,287 Finance Leases Current finance lease liabilities Other current liabilities $ 208 $ 3,213 Noncurrent finance lease liabilities Other long-term liabilities $ 282 $ 16,942 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Summary of Components of Debt | Debt consists of the following (in thousands): September 30, 2023 December 31, 2022 Term Loan Credit Facility $ 180,000 $ 148,995 Less: Debt discount, net of accumulated amortization of $ 189 and $ 546 , respectively ( 7,060 ) ( 1,254 ) Less: Deferred financing fees, net of accumulated amortization of $ 11 and $ 248 , respectively ( 429 ) ( 567 ) Less: Current portion (a) — ( 20,586 ) Long-term debt $ 172,511 $ 126,588 (a) The current portion of long-term debt reflects payments based on the terms of the 2023 Term Loan Credit Facility and the 2021 Term Loan Credit Facility as of September 30, 2023 and December 31, 2022, respectively. |
Redeemable Noncontrolling Int_2
Redeemable Noncontrolling Interest (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Noncontrolling Interest [Abstract] | |
Summary of Adjustments to the Value of Redeemable Noncontrolling Interest | From the date of the IPO through September 30, 2023, we recorded adjustments to the value of the redeemable noncontrolling interest as presented in the table below: Redeemable Noncontrolling Interest Balance at March 13, 2023 (1) $ 771,345 Net income attribution post-IPO 66,190 $ 0.35 /unit distribution to Atlas Sand Operating, LLC unitholders ( 14,998 ) Other distributions to redeemable non-controlling interest unitholders ( 7,158 ) Redemption of operating units of Atlas Sand Operating, LLC for Class A common stock ( 13,640 ) Adjustment of redeemable noncontrolling interest to redemption amount (2) 185,412 Balance at September 30, 2023 $ 987,151 (1) Based on the Operating Units held by the Legacy Owners who also held 42,852,499 shares of Old Atlas Class B common stock and an Old Atlas Class A common stock price of $ 18.00 on the date on which we consummated the IPO. (2) Based on the Operating Units held by the Legacy Owners who also held 42,258,185 shares of Old Atlas Class B common stock and an Old Atlas Class A common stock 10-day volume-weighted average closing price of $ 23.36 on September 30, 2023. In connection with the Up-C Simplification, each Operating Unit issued and outstanding immediately prior to the Effective Time, other than Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock, and the holders of such Operating Units became stockholders of New Atlas, and all of the Old Atlas Class B common stock issued and outstanding immediately prior to the Effective Time were surrendered and cancelled for no consideration. See Note 8 – Stockholders Equity – Up-C Simplification for more information. |
Stock-Based Compensations (Tabl
Stock-Based Compensations (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Restricted Stock Units [Member] | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |
Summary of Nonvested Stock Shares Activity | C hanges in non-vested RSUs outstanding under the LTIP during the nine months ended September 30, 2023 were as follows: Number of Units Weighted Average Non-vested at December 31, 2022 — $ — Granted 292,136 $ 16.23 Vested ( 25,000 ) $ 15.99 Forfeited — $ — Non-vested at September 30, 2023 267,136 $ 16.25 |
Performance Share Units [Member] | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |
Summary of Nonvested Stock Shares Activity | Changes in non-vested PSUs outstanding under the LTIP during the nine months ended September 30, 2023 were as follows: Number of Units Weighted Average Non-vested at December 31, 2022 — $ — Granted 490,167 $ 20.19 Vested ( 584 ) $ 20.19 Forfeited ( 16,360 ) $ 20.19 Non-vested at September 30, 2023 473,223 $ 20.19 |
Class P Unit [Member] | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |
Summary of Nonvested Stock Shares Activity | A summary of Atlas LLC’s Class P unit activity is as follows: Number of Class Weighted Average Non-vested at December 31, 2022 3,533 $ 151.57 Granted — $ — Vested ( 3,533 ) $ 151.57 Forfeited — $ — Non-vested at September 30, 2023 — $ — |
Earnings per Share (Tables)
Earnings per Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table reflects the allocation of net income to common stockholders and EPS computations for the period indicated based on a weighted average number of shares of common stock outstanding for the period: Three Months Ended Nine Months Ended September 30, September 30, 2023 2023 Numerator: Net income $ 56,327 $ 190,443 Less: Pre-IPO net income attributable to Atlas Sand Company, LLC - 54,561 Less: Net income attributable to redeemable noncontrolling interest 26,887 66,190 Net income attributable to Atlas Energy Solutions Inc. $ 29,440 $ 69,692 Denominator: Basic weighted average shares outstanding 57,237 57,189 Dilutive potential of restricted stock units 110 77 Dilutive potential of performance share units 581 480 Diluted weighted average shares outstanding (1) $ 57,928 $ 57,746 Basic EPS attributable to Old Atlas Class A common stockholders $ 0.51 $ 1.22 Diluted EPS attributable to Old Atlas Class A common stockholders (1) $ 0.51 $ 1.21 (1) Shares of Old Atlas Class A common stock issued in exchange for Operating Units did not have a dilutive effect on EPS and were not included in the EPS calculation. |
Business and Organization (Deta
Business and Organization (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |||
Mar. 13, 2023 | Sep. 30, 2023 | Jul. 31, 2023 | Dec. 31, 2022 | |
Net proceeds | $ 291,200 | |||
Deferred tax liability arising from the IPO | $ 27,500 | $ (27,537) | ||
Legacy Owners [Member] | ||||
Economic interest | 57.10% | |||
Operating interest percentage | 42.20% | |||
Operating interest | 57.10% | |||
Atlas LLC | ||||
Percentage of voting power | 82% | |||
Atlas LLC | Legacy Owners [Member] | ||||
Economic interest | 68.50% | |||
Operating interest percentage | 42.90% | |||
Operating interest | 68.50% | |||
Common Class A [Member] | ||||
Common stock, par value | $ 0.01 | |||
Shares issued price per share | $ 18 | $ 23.36 | ||
Common stock, shares issued | 57,767,399 | |||
Common Class A [Member] | Atlas LLC | ||||
Common stock, shares issued | 39,147,501,000 | |||
Common Class B [Member] | ||||
Common stock, par value | $ 0.01 | |||
Common stock, shares issued | 42,258,185 | |||
Common Class B [Member] | Atlas LLC | ||||
Common stock, par value | $ 0.01 | |||
Common stock, shares issued | 42,852,499,000 | |||
Common Stock [Member] | Common Class A [Member] | ||||
Issuance of common stock in IPO, net of offering costs, Shares | 18,000,000 | |||
Common Stock [Member] | Common Class A [Member] | Atlas LLC | ||||
Shares issued | 1,000,000 | |||
Pubco Merger [Member] | New Atlas Common Stock [Member] | ||||
Common stock, par value | $ 0.01 | |||
IPO [Member] | ||||
Gross proceeds | $ 324,000 | |||
Underwriting discounts and commissions | $ 20,600 | |||
Offering costs | $ 5,900 | $ 6,300 | ||
IPO [Member] | Common Class A [Member] | ||||
Issuance of common stock in IPO, net of offering costs, Shares | 18,000,000 | |||
Common stock, par value | $ 0.01 | |||
Shares issued price per share | $ 18 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Oct. 20, 2021 | |
Intrafi account deposits amount | $ 119,400 | ||
US government securities at carrying value | $ 112,300 | ||
Allowance for credit losses | de minimis | de minimis | |
Liabilities for uncertain tax positions or gross unrecognized tax benefits | $ 0 | $ 0 | |
Legacy Owners | |||
Economic interest | 42.20% | ||
2021 Term Loan Credit Facility | |||
Loans outstanding at a fixed interest rate | 8.47% | ||
2023 Term Loan Credit Facility | |||
Adavance in loan credit facility | $ 180,000 | ||
Loans outstanding at a fixed interest rate | 9.50% | ||
Customer Concentration Risk | Accounts Receivable | Products And Services | Three Customers | |||
Concentration risk percentage | 14% | ||
Customer Concentration Risk | Accounts Receivable | Products And Services | Maximum [Member] | Two Customers | |||
Concentration risk percentage | 19% | ||
Customer Concentration Risk | Accounts Receivable | Products And Services | Maximum [Member] | Three Customers | |||
Concentration risk percentage | 20% | ||
Customer Concentration Risk | Accounts Receivable | Products And Services | Minimum [Member] | Two Customers | |||
Concentration risk percentage | 13% | ||
Customer Concentration Risk | Accounts Receivable | Products And Services | Minimum [Member] | Three Customers | |||
Concentration risk percentage | 11% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Summary of Fair Values and Carrying Values of Long-Term Debt (Details) - 2023 Term Loan Credit Facility - Valuation Market Approach - Fair Value Inputs Level 2 - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Carrying Value | $ 172,511 | $ 147,174 |
Fair Value | $ 181,003 | $ 146,837 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Inventory, Net [Abstract] | ||
Raw materials | $ 531 | $ 290 |
Work-in-process | 2,924 | 4,825 |
Finished goods | 506 | 499 |
Inventories | $ 3,961 | $ 5,614 |
Inventories - Additional Inform
Inventories - Additional Information (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Inventory, Net [Abstract] | ||
Inventory reserve | $ 0 | $ 0 |
Property, Plant and Equipment_3
Property, Plant and Equipment, Net - Schedule of Components of Property, Plant and Equipment, Net (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 951,789 | $ 639,503 |
Less: Accumulated depreciation and depletion | (122,792) | (97,979) |
Property, plant and equipment, net | 828,997 | 541,524 |
Plant facilities associated with productive, depletable properties | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 244,464 | 243,613 |
Plant equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 351,583 | 251,122 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 3,009 | 3,009 |
Furniture and office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 2,267 | 1,407 |
Computer and network equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 1,648 | 1,648 |
Buildings and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 32,382 | 25,402 |
Logistics equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 44,647 | 1,591 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 271,789 | $ 111,711 |
Property, Plant and Equipment_4
Property, Plant and Equipment, Net - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Property, Plant and Equipment [Line Items] | ||||
Impairment of long-lived assets | $ 0 | $ 0 | $ 0 | $ 0 |
Depreciation, Depletion and Accretion Expense | ||||
Property, Plant and Equipment [Line Items] | ||||
Depreciation | 8,700,000 | 5,700,000 | 23,800,000 | 15,700,000 |
Depletion | 1,500,000 | 1,400,000 | 4,400,000 | 4,000,000 |
Selling, General and Administrative Expense | ||||
Property, Plant and Equipment [Line Items] | ||||
Depreciation | $ 500,000 | $ 200,000 | $ 1,200,000 | $ 800,000 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | ||||
Jul. 31, 2023 | Jul. 28, 2022 | May 16, 2022 | May 31, 2023 | Sep. 30, 2022 | |
Lessee, Lease, Description [Line Items] | |||||
Amended operating lease right-of-use assets | $ 1.3 | ||||
Amended finance lease right-of-use assets | 3.2 | ||||
Amended operating lease, liability | 1.3 | ||||
Amended finance lease, liability | $ 3.2 | ||||
Finance Leases Liabilities | |||||
Lessee, Lease, Description [Line Items] | |||||
Repaid amount | $ 42.8 | ||||
Finance Lease Assets | |||||
Lessee, Lease, Description [Line Items] | |||||
Repaid amount | 39.5 | ||||
2023 Term Loan Credit Facility | Initial Term Loan | |||||
Lessee, Lease, Description [Line Items] | |||||
Debt instrument, face amount | 180 | ||||
2023 Term Loan Credit Facility | Delayed Draw Term Loans [Member] | |||||
Lessee, Lease, Description [Line Items] | |||||
Debt instrument, face amount | 100 | ||||
Repaid amount | 2.7 | ||||
2021 Term Loan Credit Facility | |||||
Lessee, Lease, Description [Line Items] | |||||
Repaid amount | 133.4 | $ 3.8 | |||
2021 Term Loan Credit Facility | Finance Leases Liabilities | |||||
Lessee, Lease, Description [Line Items] | |||||
Repaid amount | 42.8 | ||||
2021 Term Loan Credit Facility | Finance Lease Assets | |||||
Lessee, Lease, Description [Line Items] | |||||
Repaid amount | $ 39.5 | ||||
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member] | |||||
Lessee, Lease, Description [Line Items] | |||||
Debt Instrument, Basis Spread on Variable Rate | 8% | 8% | |||
Transportation and Logistics Equipment Member | Stonebriar Commercial Finance Member | |||||
Lessee, Lease, Description [Line Items] | |||||
Purchases of transportation and logistics equipment | $ 70 | ||||
Purchases of dredges and related equipment | $ 70 | ||||
Dredges and Related Equipment Member | |||||
Lessee, Lease, Description [Line Items] | |||||
Purchases of transportation and logistics equipment | $ 10 | ||||
Purchases of dredges and related equipment | $ 10 |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Leases [Abstract] | ||||
Amortization of right-of-use assets | $ 846 | $ 515 | $ 4,286 | $ 971 |
Interest on lease liabilities | 345 | 167 | 1,742 | 286 |
Operating lease cost | 289 | 227 | 823 | 839 |
Variable lease cost | 160 | 173 | 458 | 515 |
Short-term lease cost | 5,893 | 3,740 | 18,255 | 7,130 |
Total lease cost | $ 7,533 | $ 4,822 | $ 25,564 | $ 9,741 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow and Other Information Related to Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Leases [Abstract] | ||||
Operating cash outflows from operating leases | $ 443 | $ 290 | $ 1,018 | $ 1,016 |
Operating cash outflows from finance leases | 345 | 167 | 1,742 | 286 |
Financing cash outflows from finance leases | 232 | 310 | 1,932 | 703 |
Operating leases | 0 | 0 | 559 | 5,384 |
Finance leases | $ 4,187 | $ 7,262 | $ 25,063 | $ 11,213 |
Leases - Schedule of Lease Term
Leases - Schedule of Lease Terms and Discount Rates (Details) | Sep. 30, 2023 | Dec. 31, 2022 |
Weighted-average remaining lease term: | ||
Operating leases | 3 years 10 months 24 days | 4 years 6 months |
Finance leases | 3 years 7 months 6 days | 5 years 3 months 18 days |
Weighted-average discount rate: | ||
Operating leases | 4.60% | 4.30% |
Finance leases | 5% | 9.40% |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Commitments of Operating and Finance Leases Liabilities (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Leases [Abstract] | |
Finance, Reminder of 2023 | $ 74 |
Finance, 2024 | 176 |
Finance, 2025 | 90 |
Finance, 2026 | 90 |
Finance, 2027 | 90 |
Finance, Thereafter | 22 |
Finance, Total lease payments | 542 |
Finance, Less imputed interest | 52 |
Finance, Total | 490 |
Operating, Reminder of 2023 | 293 |
Operating, 2024 | 1,443 |
Operating, 2025 | 1,474 |
Operating, 2026 | 1,414 |
Operating, 2027 | 815 |
Operating, Thereafter | 11 |
Operating, Total lease payments | 5,450 |
Operating, Less imputed interest | 465 |
Operating, Total | $ 4,985 |
Leases - Schedule Of Supplement
Leases - Schedule Of Supplemental Balance Sheet Related To Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Operating Leases: | ||
Operating Lease, Liability, Current | $ 1,227 | $ 1,082 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Current | Other Liabilities, Current |
Operating Lease, Liability, Noncurrent | $ 3,758 | $ 4,287 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent |
Finance Leases: | ||
Finance Lease, Liability, Current | $ 208 | $ 3,213 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Current | Other Liabilities, Current |
Finance Lease, Liability, Noncurrent | $ 282 | $ 16,942 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent |
Debt - Summary of Components of
Debt - Summary of Components of Debt (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Debt Disclosure [Abstract] | ||
Term loan credit facility | $ 180,000 | $ 148,995 |
Less: Debt discount, net of accumulated amortization of $94 and $546, respectively | (7,060) | (1,254) |
Less: Deferred financing fees, net of accumulated amortization of de minimis and $248, respectively | (429) | (567) |
Less: Current portion | 0 | (20,586) |
Long-term debt | $ 172,511 | $ 126,588 |
Debt - Summary of Components _2
Debt - Summary of Components of Debt (Parenthetical) (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
Debt discount, net of accumulated amortization | $ 189 | $ 546 |
Deferred financing fees, net of accumulated amortization | $ 11 | $ 248 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||
Oct. 30, 2023 | Jul. 31, 2023 | Feb. 22, 2023 | Dec. 14, 2018 | Jul. 31, 2023 | May 31, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Apr. 30, 2023 | Dec. 31, 2022 | Oct. 20, 2021 | |
Debt Instrument [Line Items] | |||||||||||||
Credit facility, maturity date | Dec. 14, 2023 | ||||||||||||
Dividends declared (in dollars per share) | $ 0.35 | ||||||||||||
Dividend Payable | $ 20,000,000 | $ 20,000,000 | $ 15,000,000 | $ 12,600,000 | $ 12,600,000 | $ 4,100,000 | |||||||
Term loan credit facility | 180,000,000 | 180,000,000 | $ 148,995,000 | ||||||||||
2023 ABL Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Aggregate principal amount | 75,000,000 | $ 75,000,000 | |||||||||||
Credit facility, maturity date | Feb. 22, 2028 | ||||||||||||
Minimum availability covenant percent | 12.50% | ||||||||||||
Minimum availability covenant | $ 7,500,000 | ||||||||||||
Fixed charge coverage ratio, Minimum | 1 | ||||||||||||
Fixed charge coverage ratio, maximum | 1 | ||||||||||||
Line of credit, liquidity threshold | $ 30,000,000 | ||||||||||||
Divident payment required | 7,500,000 | ||||||||||||
Outstanding borrowings | 0 | 0 | |||||||||||
Interest expense, unutilized commitment fees and other fees | 100,000 | $ 100,000 | 200,000 | $ 200,000 | |||||||||
Remaining borrowing capacity | 73,900,000 | 73,900,000 | |||||||||||
Delayed draw term loan facility | 75,000,000 | 75,000,000 | |||||||||||
2023 ABL Credit Facility | Maximum [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Aggregate principal amount | 7,500,000 | 7,500,000 | |||||||||||
Delayed draw term loan facility | 7,500,000 | 7,500,000 | |||||||||||
2023 ABL Credit Facility | Line Of Credit | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Aggregate principal amount | $ 75,000,000 | ||||||||||||
Delayed draw term loan facility | 75,000,000 | ||||||||||||
2018 ABL Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Aggregate principal amount | $ 50,000,000 | ||||||||||||
Interest expense, debt | $ 200,000 | ||||||||||||
Remaining borrowing capacity | 0 | ||||||||||||
Delayed draw term loan facility | $ 50,000,000 | ||||||||||||
Finance Leases Liabilities | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Repaid amount | 42,800,000 | ||||||||||||
Finance Lease Assets | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Repaid amount | 39,500,000 | ||||||||||||
Prepayment Fee on the 2021 Term Loan Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Repaid amount | $ 2,600,000 | ||||||||||||
Operating Units | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Dividends declared (in dollars per share) | $ 0.2 | $ 0.15 | |||||||||||
Dividend declared | 0.15 | ||||||||||||
Dividend payable date | Aug. 10, 2023 | ||||||||||||
Atlas Sand Company, LLC | Minimum [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
commitment fee percentage | 0.375% | ||||||||||||
Atlas Sand Company, LLC | Maximum [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
commitment fee percentage | 0.50% | ||||||||||||
Common Class A [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Dividends declared (in dollars per share) | $ 0.05 | 0.05 | $ 0.15 | ||||||||||
Base dividends declared (in dollars per share) | $ 0.15 | $ 0.15 | |||||||||||
Dividend payable date | Aug. 17, 2023 | ||||||||||||
2021 Term Loan Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Loans outstanding at a fixed interest rate | 8.47% | ||||||||||||
Maturity date of long term debt | Oct. 01, 2027 | ||||||||||||
Deferred issuance cost, writeoff | $ 1.4 | ||||||||||||
Repaid amount | 133,400,000 | $ 3,800,000 | |||||||||||
2021 Term Loan Credit Facility | Finance Leases Liabilities | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Repaid amount | 42,800,000 | ||||||||||||
2021 Term Loan Credit Facility | Finance Lease Assets | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Repaid amount | $ 39,500,000 | ||||||||||||
Letter Of Credit | 2023 ABL Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Aggregate principal amount | 25,000,000 | 7,500,000 | $ 7,500,000 | ||||||||||
Letters of credit outstanding amount | 1,100,000 | 1,100,000 | |||||||||||
Delayed draw term loan facility | $ 25,000,000 | $ 7,500,000 | $ 7,500,000 | ||||||||||
SOFR Loan | 2023 ABL Credit Facility | Minimum [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Interest rate basis percentage | 1.50% | ||||||||||||
Interest rate margin percentage | 0.50% | ||||||||||||
SOFR Loan | 2023 ABL Credit Facility | Maximum [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Interest rate basis percentage | 2% | ||||||||||||
Interest rate margin percentage | 1% | ||||||||||||
2023 Term Loan Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Loans outstanding at a fixed interest rate | 9.50% | 9.50% | |||||||||||
Prepayment Principal Amount Percentage | 100% | ||||||||||||
Prepayment fee percentage | 8% | ||||||||||||
Prepayment fee percentage, two years | 4% | ||||||||||||
Prepayment fee percentage, three years | 3% | ||||||||||||
Prepayment fee percentage, thereafter | 2% | ||||||||||||
Line of credit minimum liquidity amount | $ 30,000,000 | ||||||||||||
2023 Term Loan Credit Facility | Minimum [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Annualized leverage ratio | 1 | 1 | |||||||||||
2023 Term Loan Credit Facility | Maximum [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Annualized leverage ratio | 4 | 4 | |||||||||||
2023 Term Loan Credit Facility | Initial Term Loan | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Loans outstanding at a fixed interest rate | 9.50% | 9.50% | |||||||||||
Debt instrument, face amount | $ 180,000,000 | $ 180,000,000 | |||||||||||
2023 Term Loan Credit Facility | Delayed Draw Term Loan | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Loans outstanding at a fixed interest rate | 5.95% | 5.95% | |||||||||||
Debt instrument, face amount | $ 100,000,000 | $ 100,000,000 | |||||||||||
Monthly payable installments, percentage | 80% | ||||||||||||
Repaid amount | $ 2,700,000 | ||||||||||||
Percentage of outstanding principal balance due at maturity | 20% | ||||||||||||
2023 Term Loan Credit Facility | Senior Secured Term Loan Fee | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Repaid amount | $ 2,700,000 |
Commitments And Contingencies -
Commitments And Contingencies - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||||||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Apr. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Apr. 30, 2022 | Mar. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | |||||||||
Payment purchase transportation and logistics equipment | $ 15.3 | $ 15.3 | $ 11.9 | $ 8.5 | |||||
Expected use of IPO proceeds | 291.2 | ||||||||
Purchase Commitment Dated March 23, 2022 | |||||||||
Finite-Lived Intangible Assets [Line Items] | |||||||||
Payment purchase transportation and logistics equipment | $ 26.2 | $ 5.2 | |||||||
2018 ABL Credit Facility | Standby Letters Of Credit | |||||||||
Finite-Lived Intangible Assets [Line Items] | |||||||||
Letters of credit outstanding amount | $ 1.1 | ||||||||
2023 ABL Credit Facility | Standby Letters Of Credit | |||||||||
Finite-Lived Intangible Assets [Line Items] | |||||||||
Letters of credit outstanding amount | $ 1.1 | $ 1.1 | |||||||
Maximum [Member] | |||||||||
Finite-Lived Intangible Assets [Line Items] | |||||||||
Percentage of cost of sales | 10% | 15% | |||||||
Purchase obligation expected term of use of proceeds | 14 months | ||||||||
Minimum [Member] | |||||||||
Finite-Lived Intangible Assets [Line Items] | |||||||||
Percentage of cost of sales | 5% | 10% | |||||||
Purchase obligation expected term of use of proceeds | 12 months | ||||||||
Royalty Agreements | Minimum [Member] | |||||||||
Finite-Lived Intangible Assets [Line Items] | |||||||||
Minimum payment for royalty agreement | $ 1 |
Stockholders Equity - Additiona
Stockholders Equity - Additional Information (Details) $ / shares in Units, $ in Millions | 1 Months Ended | 9 Months Ended | |||||||
Oct. 30, 2023 $ / shares | Jul. 31, 2023 USD ($) | Sep. 30, 2023 USD ($) shares | Jul. 31, 2023 USD ($) $ / shares | May 31, 2023 USD ($) $ / shares | Apr. 30, 2023 USD ($) | Sep. 30, 2023 USD ($) Vote $ / shares shares | Mar. 13, 2023 shares | Sep. 30, 2022 shares | |
Dividends declared (in dollars per share) | $ 0.35 | ||||||||
Dividend Payable | $ | $ 20 | $ 12.6 | $ 20 | $ 15 | $ 4.1 | $ 12.6 | |||
Investment company dividend distribution | $ | 7.2 | 2.3 | |||||||
Pro rata distribution | $ | $ 5.4 | $ 1.8 | |||||||
New Atlas Common Stock [Member] | |||||||||
Dividends declared (in dollars per share) | $ 0.2 | ||||||||
2021 Term Loan Credit Facility | |||||||||
Repaid amount | $ | $ 133.4 | $ 3.8 | |||||||
Operating Units | |||||||||
Dividends declared (in dollars per share) | $ 0.2 | $ 0.15 | |||||||
Dividend declared | 0.15 | ||||||||
Dividend payable date | Aug. 10, 2023 | ||||||||
Common Class A [Member] | |||||||||
Common stock, shares outstanding | shares | 57,767,399 | 57,767,399 | 0 | ||||||
Voting rights per share | Vote | 1 | ||||||||
Dividends declared (in dollars per share) | 0.05 | 0.05 | $ 0.15 | ||||||
Base dividends declared (in dollars per share) | $ 0.15 | $ 0.15 | |||||||
Dividend payable date | Aug. 17, 2023 | ||||||||
Common Class B [Member] | |||||||||
Common stock, shares outstanding | shares | 42,258,185 | 42,258,185 | 42,852,499 | 0 | |||||
Voting rights per share | Vote | 1 |
Redeemable Noncontrolling Int_3
Redeemable Noncontrolling Interest - Additional Information (Details) | Sep. 30, 2023 |
Legacy Owners | |
Noncontrolling Interest [Line Items] | |
Economic interest | 42.20% |
Redeemable Noncontrolling Int_4
Redeemable Noncontrolling Interest - Summary of Adjustments to the Value of Redeemable Noncontrolling Interest (Details) - USD ($) $ in Thousands | 7 Months Ended | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2023 | ||
Redeemable Noncontrolling Interest [Line Items] | |||
Redeemable noncontrolling interest, Beginning balance | $ 771,345 | [1] | $ 0 |
$0.35/unit distribution to Atlas Sand Operating, LLC unitholders | (14,998) | (14,998) | |
Redemption of operating units of Atlas Sand Operating, LLC for Class A common stock redeemable noncontrolling interest | (7,158) | (13,640) | |
Redemption of operating units of Atlas Sand Operating, LLC for Class A common stock | (13,640) | 13,640 | |
Adjustment of redeemable noncontrolling interest to redemption amount | 185,412 | [2] | (185,412) |
Redeemable noncontrolling interest, Ending balance | 987,151 | 987,151 | |
Post-IPO [Member] | |||
Redeemable Noncontrolling Interest [Line Items] | |||
Net income attribution post-IPO | $ 66,190 | $ 66,190 | |
[1] Based on the Operating Units held by the Legacy Owners who also held 42,852,499 shares of Old Atlas Class B common stock and an Old Atlas Class A common stock price of $ 18.00 on the date on which we consummated the IPO. Based on the Operating Units held by the Legacy Owners who also held 42,258,185 shares of Old Atlas Class B common stock and an Old Atlas Class A common stock 10-day volume-weighted average closing price of $ 23.36 on September 30, 2023. In connection with the Up-C Simplification, each Operating Unit issued and outstanding immediately prior to the Effective Time, other than Operating Units held by Old Atlas, was exchanged for one share of New Atlas Common Stock, and the holders of such Operating Units became stockholders of New Atlas, and all of the Old Atlas Class B common stock issued and outstanding immediately prior to the Effective Time were surrendered and cancelled for no consideration. See Note 8 – Stockholders Equity – Up-C Simplification for more information. |
Redeemable Noncontrolling Int_5
Redeemable Noncontrolling Interest - Summary of Adjustments to the Value of Redeemable Noncontrolling Interest (Parenthetical) (Details) - $ / shares | 7 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2023 | Mar. 13, 2023 | Sep. 30, 2022 | |
Redeemable Noncontrolling Interest [Line Items] | ||||
Unit distribution to unit holders (in dollars per share) | $ 0.35 | $ 0.35 | ||
Common Class B [Member] | ||||
Redeemable Noncontrolling Interest [Line Items] | ||||
Common stock, shares outstanding | 42,258,185 | 42,258,185 | 42,852,499 | 0 |
Common Class A [Member] | ||||
Redeemable Noncontrolling Interest [Line Items] | ||||
Common stock, shares outstanding | 57,767,399 | 57,767,399 | 0 | |
Shares Issued, Price Per Share | $ 23.36 | $ 23.36 | $ 18 | |
Common Class A [Member] | IPO [Member] | ||||
Redeemable Noncontrolling Interest [Line Items] | ||||
Shares Issued, Price Per Share | $ 18 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||||
Sep. 22, 2023 | May 22, 2023 | Mar. 13, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Mar. 08, 2023 | May 28, 2018 | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||||||||
Stock and unit-based compensation | $ 1,414,000 | $ 160,000 | $ 3,660,000 | $ 543,000 | |||||
Restricted Stock Units [Member] | |||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||||||||
Unamortized compensation expense | 3,400,000 | $ 3,400,000 | |||||||
Weighted average remaining vesting period | 1 year 3 months 18 days | ||||||||
Granted (in shares) | 3,197 | 28,217 | 260,722 | 292,136 | |||||
Granted (per share) | $ 22.68 | $ 17.72 | $ 15.99 | $ 16.23 | |||||
Stock and unit-based compensation | 600,000 | $ 1,400,000 | |||||||
Performance Share Units [Member] | |||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||||||||
Unamortized compensation expense | 7,700,000 | $ 7,700,000 | |||||||
Weighted average remaining vesting period | 2 years 3 months 18 days | ||||||||
Granted (in shares) | 490,167 | ||||||||
Granted (per share) | $ 20.19 | ||||||||
Stock and unit-based compensation | $ 800,000 | $ 2,000,000 | |||||||
Performance Share Units [Member] | Minimum [Member] | |||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||||||||
Percentage of number of units vested | 0% | ||||||||
Performance Share Units [Member] | Maximum [Member] | |||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||||||||
Percentage of number of units vested | 200% | ||||||||
Long Term Incentive Plan [Member] | Common Class A [Member] | |||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||||||||
Shares reserved for issuance | 9,504,057 | 9,504,057 | 10,270,000 | ||||||
ASMC Incentive Plan [Member] | |||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||||||||
Stock and unit-based compensation | $ 100,000 | 100,000 | $ 100,000 | 200,000 | |||||
Unrecognized unit based compensation expense | 0 | 0 | |||||||
ASCO Incentive Plan [Member] | |||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||||||||
Shares reserved for issuance | 149,425 | ||||||||
Stock and unit-based compensation | 200,000 | $ 100,000 | 200,000 | $ 300,000 | |||||
Unrecognized unit based compensation expense | $ 0 | $ 0 | |||||||
ASCO Incentive Plan [Member] | Scenario Previously Reported [Member] | |||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||||||||
Shares reserved for issuance | 100,000 |
Stock-Based Compensations - Sum
Stock-Based Compensations - Summary of Nonvested Stock Shares Activity (Details) - $ / shares | 9 Months Ended | |||
Sep. 22, 2023 | May 22, 2023 | Mar. 13, 2023 | Sep. 30, 2023 | |
Restricted Stock Units [Member] | ||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Non-vested at December 31, 2022 | 0 | |||
Granted (in shares) | 3,197 | 28,217 | 260,722 | 292,136 |
Vested (in shares) | (25,000) | |||
Forfeited (in shares) | 0 | |||
Non-vested at September 30, 2023 | 267,136 | |||
Beginning balance (per share) | $ 0 | |||
Granted (per share) | $ 22.68 | $ 17.72 | $ 15.99 | 16.23 |
Vested (per share) | 15.99 | |||
Forfeited (per share) | 0 | |||
Ending balance (per share) | $ 16.25 | |||
Performance Share Units [Member] | ||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Non-vested at December 31, 2022 | 0 | |||
Granted (in shares) | 490,167 | |||
Vested (in shares) | (584) | |||
Forfeited (in shares) | (16,360) | |||
Non-vested at September 30, 2023 | 473,223 | |||
Beginning balance (per share) | $ 0 | |||
Granted (per share) | 20.19 | |||
Vested (per share) | 20.19 | |||
Forfeited (per share) | 20.19 | |||
Ending balance (per share) | $ 20.19 | |||
Class P Unit [Member] | ||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Non-vested at December 31, 2022 | 3,533 | |||
Granted (in shares) | 0 | |||
Vested (in shares) | (3,533) | |||
Forfeited (in shares) | 0 | |||
Non-vested at September 30, 2023 | 0 | |||
Beginning balance (per share) | $ 151.57 | |||
Granted (per share) | 0 | |||
Vested (per share) | 151.57 | |||
Forfeited (per share) | 0 | |||
Ending balance (per share) | $ 0 |
Earnings per Share - Schedule o
Earnings per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Numerator: | ||||
Net income | $ 56,327 | $ 65,056 | $ 190,443 | $ 154,423 |
Less: Pre-IPO net income attributable to Atlas Sand Company, LLC | 0 | 54,561 | ||
Less: Net income attributable to redeemable noncontrolling interest | 26,887 | 66,190 | ||
Net income attributable to Atlas Energy Solutions, Inc. | $ 29,440 | $ 69,692 | $ 154,423 | |
Denominator: | ||||
Basic weighted average shares outstanding | 57,237 | 57,189 | ||
Dilutive potential of restricted stock units | 110 | 77 | ||
Dilutive potential of performance share units | 581 | 480 | ||
Diluted weighted average shares outstanding | 57,928 | 57,746 | ||
Basic EPS attributable to Old Atlas Class A common stockholders | $ 0.51 | $ 1.22 | ||
Diluted EPS attributable to Old Atlas Class A common stockholders | $ 0.51 | $ 1.21 |
Earnings per Share - Additional
Earnings per Share - Additional Information (Details) - shares | Sep. 30, 2023 | Mar. 13, 2023 | Sep. 30, 2022 |
Common Class A [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Common stock, shares outstanding | 57,767,399 | 0 | |
Common Class B [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Common stock, shares outstanding | 42,258,185 | 42,852,499 | 0 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Mar. 13, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Texas franchise tax (as a percent) | 0.75% | ||||
Effective income tax rate (as a percent) | 9.70% | 9.70% | |||
U.S. federal statutory tax rate | 21% | 21% | |||
Income tax expense | $ 7,637 | $ 604 | $ 20,368 | $ 1,422 | |
IPO [Member] | |||||
Deferred tax liabilities | $ 27,500 | ||||
Common Class A [Member] | |||||
Shares issued price per share | $ 18 | $ 23.36 | $ 23.36 | ||
Common Class A [Member] | IPO [Member] | |||||
Shares issued price per share | $ 18 | ||||
Number of units issued | 18,000,000 |
Related-Party Transactions - Ad
Related-Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Accounts payable | $ 57,520 | $ 57,520 | $ 31,645 | ||
Legacy Owners [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Operating interest percentage | 42.20% | 42.20% | |||
Class A and Class B Member | Common Stock [Member] | Legacy Owners [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Operating interest percentage | 38.40% | 38.40% | |||
Brigham oil & gas, LLC | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Related party amount in sales | $ 0 | $ 0 | $ 0 | $ 0 | |
Accounts Receivable, Related Parties | 0 | 0 | 900 | ||
Brigham land management LLC | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Related Party Transaction, Expenses from Transactions with Related Party | 300 | 300 | 800 | 800 | |
Accounts payable | $ 100 | 100 | 100 | ||
Brigham earth, LLC | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Related Party Transaction, Expenses from Transactions with Related Party | $ 200 | $ 200 | $ 600 | ||
Accounts payable | 100 | ||||
Related party accounts payable | de minimis | ||||
Related party accounts payable outstanding | de minimus | ||||
Anthem ventures, LLC | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Related Party Transaction, Expenses from Transactions with Related Party | $ 200 | ||||
Accounts payable | $ 100 | 100 | 0 | ||
Related party accounts payable outstanding | de minimus | de minimis | de minimis | ||
In A Good Mood | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Related Party Transaction, Expenses from Transactions with Related Party | $ 100 | $ 100 | 100 | $ 100 | |
Accounts payable | $ 0 | $ 0 | $ 0 |