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| Vertex Energy Announces First Quarter 2024 Results and Optimization of Hydrocracking Capacity From Renewables to Conventional Production |
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| 6:00a ET May 9 '24 BusinessWire |
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Vertex Energy, Inc. (NASDAQ:VTNR) ("Vertex" or the "Company"), a leading specialty refiner and marketer of high-quality refined products and renewable fuels, today announced its operational and financial results for the first quarter of 2024. The Company also announced that it plans to optimize its hyrdrocracking capacity between conventional production and renewables production moving forward.
The Company will host a conference call to discuss first quarter 2024 results today, at 9:00 A.M. Eastern Time. Details regarding the conference call are included at the end of this release.
Highlights for the first quarter of 2024 and through the date of this press release include:
Continued safe operation of the Company's Mobile, Alabama refinery (the "Mobile Refinery") with first quarter 2024 conventional throughput of 64,065 barrels per day (bpd), above the high end of prior guidance;
Reduced net loss attributable to the Company to ($17.7) million, or ($0.19) per fully-diluted share compared to the fourth quarter 2023;
Increased Adjusted EBITDA to $18.6 million driven by 28% improvement in crack spreads compared to the fourth quarter of 2023;
Decreased direct operating expense by 11% and capital expenditures by 29% compared to previous guidance midpoints;
Achieved renewable diesel ("RD") throughput of 4,090 bpd, in line with previous guidance; and
Reported total cash and cash equivalents of $65.7 million, including restricted cash of $3.6 million.
Highlights for the strategic redirection of the Company's renewable business:
Announced a production pause and pivot regarding the Company's renewable business;
Optimizing the Mobile Refinery hydrocracker capacity from renewable diesel to conventional fuels;
Expect to deplete Company inventories of renewable feedstocks prior to the conversion;
Conversion will be timed with a planned catalyst change and maintenance turnaround that was already scheduled for 2024, after which hydrocracker production is expected to contribute additional upgraded conventional product volumes in Q4 2024; and
Opportunity to optimize hydrocracker production in conventional service while maintaining the proven renewable diesel production flexibility when market conditions warrant.
Note: Schedules reconciling the Company's generally accepted accounting principles in the United States ("GAAP") and non-GAAP financial results, including Adjusted EBITDA and certain key performance indicators, are included later in this release (see also "Non-GAAP Financial Measures and Key Performance Indicators", below).
Mr. Benjamin P. Cowart, Vertex's Chief Executive Officer, stated, "We had a strong operational and financial quarter, as we maintained our commitment to operating safely and reliably. We saw an improved crack spread environment, which drove our Adjusted EBITDA higher by over $50 million compared to the fourth quarter of 2023. Additionally, we saw conventional throughput above our guidance and managed direct operating costs and capital expenditures below our guidance.
"Over the past few years, we have made material advancements and strategic decisions to grow Vertex. For the past two years we have operated safely and efficiently while investing capital into upgrading the Mobile Refinery. We built in flexibility with our capital spend to allow us to redeploy our renewable equipment back into conventional production if our strategy required adjustment. Due to the significant macroeconomic headwinds over the past 12 months, many of which we believe will continue to occur over the next 18 months and potentially beyond, we have decided to strategically pause our renewable diesel business and pivot to producing conventional fuels from the hydrocracker unit. We plan to reconfigure the hydrocracker in conjunction with a planned turnaround on the unit."
Mr. Cowart continued, "I am appreciative of the team for their work in proving the hydrocracker in renewables service, obtaining multiple pathway approvals, and successfully incorporating a wide variety of renewable feedstocks. In the future, based on economics and macro conditions, we expect to optimize our hydrocracker capacity between conventional and renewables service. We believe this flexibility to produce based on market demand materially enhances our unit's long-term value potential. Our engineering and operations teams have worked diligently to preserve our optionality for the unit and to not degrade our ability to produce conventional products. We now have a more robust hydrocracking unit in either service mode. Relative to what's currently available for renewables, we believe that this shift will allow us to optimize available returns through higher yield capabilities and higher margin opportunities for conventional products. When modeling the unit in conventional service against first quarter 2024 historical data, we estimate the unit could have significantly improved our results providing an additional fuel gross margin contribution of roughly $40 million on conventional fuels."
Mr. Cowart concluded, "Our strategic priorities remain focused on increasing our cash position, reducing our operating costs, and improving margins. We believe that this decision, to allow for more optionality in the hydrocracking unit, is not only prudent but a necessary step toward accomplishing these for the remainder of 2024 and into 2025."
MOBILE REFINERY OPERATIONS
Total conventional throughput at the Mobile Refinery was 64,065 bpd in the first quarter of 2024. Total production of finished high-value, light products, such as gasoline, diesel, and jet fuel, represented approximately 64% of total production in the first quarter of 2024, vs. 66% in the fourth quarter of 2023, and in line with management's original expectations, reflecting a continued successful yield optimization initiative at the Mobile conventional refining facility.
The Mobile Refinery's conventional operations generated a gross profit of $37.5 million and $73.6 million of fuel gross margin (a key performance indicator (KPI) discussed below) or $12.63 per barrel during the first quarter of 2024, versus generating a gross profit of $7.3 million, and fuel gross margin of $29.6 million, or $4.79 per barrel in the fourth quarter of 2023.
Total renewable throughput at the Mobile Renewable Diesel facility was 4,090 bpd in the first quarter of 2024. Total production of renewable diesel was 4,003 bpd reflecting a product yield of 98%.
The Mobile Renewable Diesel facility operations generated a gross loss of $(10.5) million and $3.8 million of fuel gross margin (a KPI discussed below) or $10.29 per barrel during the first quarter of 2024.
Renewable Business Pause and Pivot
During the second quarter of 2024, Vertex is pausing renewable fuels production and redirecting the hydrocracking unit to conventional fuels and products. The Company had a previously planned catalyst and maintenance turnaround scheduled for 2024. It will use that planned turnaround to load conventional catalyst and bring the unit out of turnaround in conventional service. In addition, the total cost of about $10 million was previously budgeted as part of the planned catalyst and maintenance turnaround and does not represent a material change to our forecasted capital spend. During the second quarter, Vertex is running the remaining Company inventories of renewable feedstock, which is expected to allow the Company to improve its working capital and margins in the second quarter from the renewable business.
First Quarter 2024 Mobile Refinery Results Summary ($/millions unless otherwise noted)
| Conventional Fuels Refinery 4Q23 TTM 1Q24
-------------------------------------------------------- -------------------- -------------------- --------------------
67,083 71,922 64,065
Total Throughput (bpd)
6.17 26.32 5.83
Total Throughput (MMbbl)
89.4% 95.9% 85.4%
Conventional Facility Capacity Utilization(1)
$2.46 $2.74 $2.75
Direct Opex Per Barrel ($/bbl)
$29.6 $288.5 $73.6
Fuel Gross Margin ($/MM)
$4.79 $10.96 $12.63
Fuel Gross Margin Per Barrel ($/bbl)
Production Yield
--------------------------------------------------------
17,826 17,388 14,678
Gasoline (bpd)
25.9% 24.0% 22.9%
% Production
14,510 15,014 13,441
ULSD (bpd)
21.1% 21.6% 21.0%
% Production
12,937 13,735 12,595
Jet (bpd)
18.8% 19.8% 19.6%
% Production
-------------------------------------------------------- -------------------- -------------------- --------------------
45,273 46,137 40,714
Total Finished Fuel Products
65.9% 63.7% 63.5%
% Production
-------------------------------------------------------- -------------------- -------------------- --------------------
23,457 26,300 23,428
Other(2)
34.1% 37.9% 36.5%
% Production
68,730 72,437 64,142
Total Production (bpd)
6.32 26.51 5.84
Total Production (MMbbl)
-------------------- -------------------- --------------------
-------------------------------------------------------- -------------------- -------------------- --------------------
Renewable Fuels Refinery 4Q23 TTM 1Q24
-------------------------------------------------------- -------------------- -------------------- --------------------
3,926 3,980 4,090
Total Renewable Throughput (bpd)
0.36 1.46 0.37
Total Renewable Throughput (MMbbl)
49.1% 49.8% 51.1%
Renewable Diesel Facility Capacity Utilization(3)
$27.32 $25.93 $25.20
Direct Opex Per Barrel ($/bbl)
$4.4 $7.5 $3.8
Renewable Fuel Gross Margin
$12.11 $5.13 $10.29
Renewable Fuel Gross Margin Per Barrel ($/bbl)
3,786 3,822 4,003
Renewable Diesel Production (bpd)
0.35 1.40 0.36
Renewable Diesel Production (MMbbl)
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| (1) Assumes 75,000 barrels per day of conventional operational capacity 2) Other includes naphtha, intermediates, and LNG 3) Assumes 8,000 barrels per day of renewable fuels operational capacity)
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First Quarter 2024 Financial Update
Vertex reported first quarter 2024 net loss attributable to the Company of ($17.7) million, or ($0.19) per fully-diluted share, versus net loss attributable to the Company of ($63.9) million, or ($0.68) per fully-diluted share for the fourth quarter of 2023. Adjusted EBITDA was $18.6 million for the first quarter of 2024, compared to Adjusted EBITDA of ($35.1) million in the fourth quarter of 2023. The improvement in quarter-over-quarter results was primarily driven by improved crack spread pricing, in Vacuum Gas Oil ("VGO") and gasoline finished products.
Balance Sheet and Liquidity Update
As of March 31, 2024, Vertex had total debt outstanding of $284 million, including $15.2 million in 6.25% Senior Convertible Notes, $196.0 million outstanding on the Company's Term Loan, finance lease obligations of $68.1 million, and $5.0 million in other obligations. The Company had total cash and equivalents of $65.7 million, including $3.6 million of restricted cash on the balance sheet as of March 31, 2024, for a net debt position of $218.5 million.
As previously announced on January 2, 2024, the Company reached an agreement with its existing lending group to modify certain terms and conditions of the current term loan agreement. The amended term loan provided an incremental $50.0 million in borrowings, the full amount of which was borrowed upon closing on December 29, 2023 and therefore was reflected in Vertex's year end 2023 cash position.
Vertex management continuously monitors current market conditions to assess expected cash generation and liquidity needs against its available cash position, using the forward crack spreads in the market. Additionally, the Company continues to evaluate strategic financial opportunities seeking further enhancements to its current liquidity position.
Management Outlook
All guidance presented below is current as of the time of this release and is subject to change. All prior financial guidance should no longer be relied upon.
| 2Q 2024
Conventional Fuels
--------------------------------------------------------- ------------------------------------------------------------
Low High High
Operational:
==================== ==================== ====================
68.0 72.0 72.0
Mobile Refinery Conventional Throughput Volume (Mbpd)
91% 96% 96%
Capacity Utilization
Production Yield Profile:
64% 68% 68%
Percentage Finished Products(1)
36% 32% 32%
Intermediate & Other Products(2)
---------------------------------------------------------
2Q 2024
Renewable Fuels
--------------------------------------------------------- ------------------------------------------------------------
Low High High
Operational:
==================== ==================== ====================
2.0 4.0 4.0
Mobile Refinery Renewable Throughput Volume (Mbpd)
25% 50% 50%
Capacity Utilization
96% 98% 98%
Production Yield
4% 2% 2%
Yield Loss
--------------------------------------------------------- -------------------- -------------------- --------------------
2Q 2024
Consolidated
--------------------------------------------------------- ------------------------------------------------------------
Low High
Operational:
==================== ====================
70.0 76.0
Mobile Refinery Total Throughput Volume (Mbpd)
84% 92%
Capacity Utilization
Financial Guidance:
$4.11 $4.46
Direct Operating Expense ($/bbl)
$20.00 $25.00
Capital Expenditures ($/MM)
--------------------------------------------------------- -------------------- -------------------- --------------------
(1.) Finished products include gasoline, ULSD, and Jet A)
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CONFERENCE CALL AND WEBCAST DETAILS
A conference call will be held today, May 9, 2024 at 9:00 A.M. Eastern Time to review the Company's financial results, discuss recent events and conduct a question-and-answer session. An audio webcast of the conference call and accompanying presentation materials will also be available in the "Events and Presentation" section of Vertex's website at www.vertexenergy.com. To listen to a live broadcast, visit the site at least 15 minutes prior to the scheduled start time in order to register, download, and install any necessary audio software.
To participate in the live teleconference:
Domestic: (888) 350-3870
International: (646) 960-0308
Conference ID: 8960754
A replay of the teleconference will be available in the "Events and Presentation" section of Vertex's website at www.vertexenergy.com for up to one year following the conference call.
ABOUT VERTEX ENERGY
Vertex Energy is a leading energy transition company that specializes in producing high-purity fuels and products from conventional, sustainable, and renewable feedstocks. The Company's innovative solutions are designed to enhance the performance of our customers and partners while also prioritizing sustainability, safety, and operational excellence. With a commitment to providing superior products and services, Vertex Energy is dedicated to shaping the future of the energy industry.
FORWARD-LOOKING STATEMENTS
Certain of the matters discussed in this communication which are not statements of historical fact constitute forward-looking statements within the meaning of the securities laws, including the Private Securities Litigation Reform Act of 1995, that involve a number of risks and uncertainties. Words such as "strategy," "expects," "continues," "plans," "anticipates," "believes," "would," "will," "estimates," "intends," "projects," "goals," "targets" and other words of similar meaning are intended to identify forward-looking statements but are not the exclusive means of identifying these statements. Any statements made in this news release other than those of historical fact, about an action, event or development, are forward-looking statements. The important factors that may cause actual results and outcomes to differ materially from those contained in such forward-looking statements include, without limitation, the Company's projected Outlook for the second quarter of 2024, the costs associated with, and outcome of the Company's plans to optimize conventional fuel and renewable diesel production moving forward,, as discussed above; statements concerning: the Company's engagement of BofA Securities, Inc., as previously disclosed; the review and evaluation of potential joint ventures, divestitures, acquisitions, mergers, business combinations, or other strategic transactions, the outcome of such review, and the impact on any such transactions, or the review thereof, and their impact on shareholder value; the process by which the Company engages in evaluation of strategic transactions; the Company's ability to identify potential partners; the outcome of potential future strategic transactions and the terms thereof; the future production of the Company's Mobile Refinery; anticipated and unforeseen events which could reduce future production at the refinery or delay future capital projects, and changes in commodity and credit values; throughput volumes, production rates, yields, operating expenses and capital expenditures at the Mobile Refinery; the timing of, and outcome of, the evaluation and associated carbon intensity scoring of the Company's feedstock blends by officials in the state of California; the ability of the Company to obtain low carbon fuel standard (LCFS) credits, and the amounts thereof; the need for additional capital in the future, including, but not limited to, in order to complete capital projects and satisfy liabilities, the Company's ability to raise such capital in the future, and the terms of such funding, including dilution caused thereby; the timing of capital projects at the Company's refinery located in Mobile, Alabama (the "Mobile Refinery") and the outcome of such projects; the future production of the Mobile Refinery, including but not limited to, renewable diesel and conventional production and the breakdown between the two; estimated and actual production and costs associated with the renewable diesel capital project; estimated revenues, margins and expenses, over the course of the agreement with Idemitsu; anticipated and unforeseen events which could reduce future production at the Mobile Refinery or delay planned and future capital projects; changes in commodity and credits values; certain early termination rights associated with third party agreements and conditions precedent to such agreements; certain mandatory redemption provisions of the outstanding senior convertible notes, the conversion rights associated therewith, and dilution caused by conversions and/or the exchanges of convertible notes; the Company's ability to comply with required covenants under outstanding senior notes and a term loan and to pay amounts due under such senior notes and term loan, including interest and other amounts due thereunder; the ability of the Company to retain and hire key personnel; the level of competition in the Company's industry and its ability to compete; the Company's ability to respond to changes in its industry; the loss of key personnel or failure to attract, integrate and retain additional personnel; the Company's ability to protect intellectual property and not infringe on others' intellectual property; the Company's ability to scale its business; the Company's ability to maintain supplier relationships and obtain adequate supplies of feedstocks; the Company's ability to obtain and retain customers; the Company's ability to produce products at competitive rates; the Company's ability to execute its business strategy in a very competitive environment; trends in, and the market for, the price of oil and gas and alternative energy sources; the impact of inflation on margins and costs; the volatile nature of the prices for oil and gas caused by supply and demand, including volatility caused by the ongoing Ukraine/Russia conflict and/or the Israel/Hamas conflict, changes in interest rates and inflation, and potential recessions; the Company's ability to maintain relationships with partners; the outcome of pending and potential future litigation, judgments and settlements; rules and regulations making the Company's operations more costly or restrictive; volatility in the market price of compliance credits (primarily Renewable Identification Numbers (RINs) needed to comply with the Renewable Fuel Standard ("RFS")) under renewable and low-carbon fuel programs and emission credits needed under other environmental emissions programs, the requirement for the Company to purchase RINs in the secondary market to the extent it does not generate sufficient RINs internally, liabilities associated therewith and the timing, funding and costs of such required purchases, if any; changes in environmental and other laws and regulations and risks associated with such laws and regulations; economic downturns both in the United States and globally, changes in inflation and interest rates, increased costs of borrowing associated therewith and potential declines in the availability of such funding; risk of increased regulation of the Company's operations and products; disruptions in the infrastructure that the Company and its partners rely on; interruptions at the Company's facilities; unexpected and expected changes in the Company's anticipated capital expenditures resulting from unforeseen and expected required maintenance, repairs, or upgrades; the Company's ability to acquire and construct new facilities; the Company's ability to effectively manage growth; decreases in global demand for, and the price of, oil, due to inflation, recessions or other reasons, including declines in economic activity or global conflicts; expected and unexpected downtime at the Company's facilities; the Company's level of indebtedness, which could affect its ability to fulfill its obligations, impede the implementation of its strategy, and expose the Company's interest rate risk; dependence on third party transportation services and pipelines; risks related to obtaining required crude oil supplies, and the costs of such supplies; counterparty credit and performance risk; unanticipated problems at, or downtime effecting, the Company's facilities and those operated by third parties; risks relating to the Company's hedging activities or lack of hedging activities; and risks relating to planned and future divestitures, asset sales, joint ventures and acquisitions.
Other important factors that may cause actual results and outcomes to differ materially from those contained in the forward-looking statements included in this communication are described in the Company's publicly filed reports, including, but not limited to, the Company's Annual Report on Form 10-K for the year ended December 31, 2023, and the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, and future Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q. These reports are available at www.sec.gov. The Company cautions that the foregoing list of important factors is not complete. All subsequent written and oral forward-looking statements attributable to the Company or any person acting on behalf of the Company are expressly qualified in their entirety by the cautionary statements referenced above. Other unknown or unpredictable factors also could have material adverse effects on Vertex's future results. The forward-looking statements included in this press release are made only as of the date hereof. Vertex cannot guarantee future results, levels of activity, performance or achievements. Accordingly, you should not place undue reliance on these forward-looking statements. Finally, Vertex undertakes no obligation to update these statements after the date of this release, except as required by law, and takes no obligation to update or correct information prepared by third parties that are not paid for by Vertex. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.
PROJECTIONS
The financial projections (the "Projections") included herein were prepared by Vertex in good faith using assumptions believed to be reasonable. A significant number of assumptions about the operations of the business of Vertex were based, in part, on economic, competitive, and general business conditions prevailing at the time the Projections were developed. Any future changes in these conditions, may materially impact the ability of Vertex to achieve the financial results set forth in the Projections. The Projections are based on numerous assumptions, including realization of the operating strategy of Vertex; industry performance; no material adverse changes in applicable legislation or regulations, or the administration thereof, or generally accepted accounting principles; general business and economic conditions; competition; retention of key management and other key employees; absence of material contingent or unliquidated litigation, indemnity, or other claims; minimal changes in current pricing; static material and equipment pricing; no significant increases in interest rates or inflation; and other matters, many of which will be beyond the control of Vertex, and some or all of which may not materialize. The Projections also assume the continued uptime of the Company's facilities at historical levels and the successful funding of, timely completion of, and successful outcome of, planned capital projects. Additionally, to the extent that the assumptions inherent in the Projections are based upon future business decisions and objectives, they are subject to change. Although the Projections are presented with numerical specificity and are based on reasonable expectations developed by Vertex's management, the assumptions and estimates underlying the Projections are subject to significant business, economic, and competitive uncertainties and contingencies, many of which will be beyond the control of Vertex. Accordingly, the Projections are only estimates and are necessarily speculative in nature. It is expected that some or all of the assumptions in the Projections will not be realized and that actual results will vary from the Projections. Such variations may be material and may increase over time. In light of the foregoing, readers are cautioned not to place undue reliance on the Projections. The projected financial information contained herein should not be regarded as a representation or warranty by Vertex, its management, advisors, or any other person that the Projections can or will be achieved. Vertex cautions that the Projections are speculative in nature and based upon subjective decisions and assumptions. As a result, the Projections should not be relied on as necessarily predictive of actual future events.
NON-GAAP FINANCIAL MEASURES AND KEY PERFORMANCE INDICATORS
In addition to our results calculated under generally accepted accounting principles in the United States ("GAAP"), in this news release we also present certain non-U.S. GAAP financial measures and key performance indicators. Non-U.S. GAAP financial measures include Adjusted Gross Margin, Fuel Gross Margin and Adjusted EBITDA, for the Company's Legacy Refining and Marketing segment, and the total Refining and Marketing segment, as a whole, and Net Long-Term Debt and Ratio of Net Long-Term Debt (collectively, the "Non-U.S. GAAP Financial Measures"). Key performance indicators include Adjusted Gross Margin, Fuel Gross Margin and Adjusted EBITDA for Conventional, Renewable and the Mobile Refinery as a whole, and Fuel Gross Margin Per Barrel of Throughput and Adjusted Gross Margin Per Barrel of Throughput for Conventional, Renewable and the Mobile Refinery as a whole (collectively, the "KPIs"). EBITDA represents net income before interest, taxes, depreciation and amortization, for continued and discontinued operations. Adjusted EBITDA represents EBITDA from operations plus or minus unrealized gain or losses on hedging activities, Renewable Fuel Standard (RFS) costs (mainly related to Renewable Identification Numbers (RINs), and inventory adjustments, acquisition costs, gain on change in value of derivative warrant liability, environmental clean-up, stock-based compensation, (gain) loss on sale of assets, and certain other unusual or non-recurring charges included in selling, general, and administrative expenses. Adjusted Gross Margin is defined as gross profit (loss) plus or minus unrealized gain or losses on hedging activities and inventory valuation adjustments. Fuel Gross Margin is defined as Adjusted Gross Margin, plus production costs, operating expenses and depreciation attributable to cost of revenues and other non-fuel items included in costs of revenues including realized and unrealized gain or losses on hedging activities, RFS costs (mainly related to RINs), fuel financing costs and other revenues and cost of sales items. Fuel Gross Margin Per Barrel of Throughput is calculated as fuel gross margin divided by total throughput barrels for the period presented. Operating Expenses Per Barrel of Throughput is defined as total operating expenses divided by total barrels of throughput. RIN Adjusted Fuel Gross Margin is defined as Fuel Gross Margin minus RIN expense divided by total barrels of throughput. RIN Adjusted Fuel Gross Margin Per Barrel of Throughput is calculated as RIN Adjusted Fuel Gross Margin divided by total throughput barrels for the period presented. Net Long-Term Debt is long-term debt and lease obligations, adjusted for unamortized discount and deferred financing costs, insurance premiums financed, less cash and cash equivalents and restricted cash. Ratio of Net Long-Term Debt is defined as Long-Term Debt divided by Adjusted EBITDA.
Each of the Non-U.S. GAAP Financial Measures and KPIs are discussed in greater detail below. The (a) Non-U.S. GAAP Financial Measures are "non-U.S. GAAP financial measures", and (b) the KPIs are, presented as supplemental measures of the Company's performance. They are not presented in accordance with U.S. GAAP. We use the Non-U.S. GAAP Financial Measures and KPIs as supplements to U.S. GAAP measures of performance to evaluate the effectiveness of our business strategies, to make budgeting decisions, to allocate resources and to compare our performance relative to our peers. Additionally, these measures, when used in conjunction with related U.S. GAAP financial measures, provide investors with an additional financial analytical framework which management uses, in addition to historical operating results, as the basis for financial, operational and planning decisions and present measurements that third parties have indicated are useful in assessing the Company and its results of operations. The Non-U.S. GAAP Financial Measures and KPIs are presented because we believe they provide additional useful information to investors due to the various noncash items during the period. Non-U.S. GAAP financial information and KPIs similar to the Non-U.S. GAAP Financial Measures and KPIs are also frequently used by analysts, investors and other interested parties to evaluate companies in our industry. The Non-U.S. GAAP Financial Measures and KPIs are unaudited, and have limitations as analytical tools, and you should not consider them in isolation, or as a substitute for analysis of our operating results as reported under U.S. GAAP. Some of these limitations are: the Non-U.S. GAAP Financial Measures and KPIs do not reflect cash expenditures, or future requirements for capital expenditures, or contractual commitments; the Non-GAAP Financial Measures and KPIs do not reflect changes in, or cash requirements for, working capital needs; the Non-GAAP Financial Measures and KPIs do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on debt or cash income tax payments; although depreciation and amortization are noncash charges, the assets being depreciated and amortized will often have to be replaced in the future, the Non-U.S. GAAP Financial Measures and KPIs do not reflect any cash requirements for such replacements; the Non-U.S. GAAP Financial Measures and KPIs represent only a portion of our total operating results; and other companies in this industry may calculate the Non-U.S. GAAP Financial Measures and KPIs differently than we do, limiting their usefulness as a comparative measure. You should not consider the Non-U.S. GAAP Financial Measures and KPIs in isolation, or as substitutes for analysis of the Company's results as reported under U.S. GAAP. The Company's presentation of these measures should not be construed as an inference that future results will be unaffected by unusual or nonrecurring items. We compensate for these limitations by providing a reconciliation of each of these non-U.S. GAAP Financial Measures and KPIs to the most comparable U.S. GAAP measure below. We encourage investors and others to review our business, results of operations, and financial information in their entirety, not to rely on any single financial measure, and to view these non-U.S. GAAP Financial Measures and KPIs in conjunction with the most directly comparable U.S. GAAP financial measure.
For more information on these non-GAAP financial measures and KPIs, please see the sections titled "Unaudited Reconciliation of Gross Profit (Loss) From Continued and Discontinued Operations to Adjusted Gross Margin, Fuel Gross Margin, Fuel Gross Margin Per Barrel of Throughput and Operating Expenses Per Barrel of Throughput", "Unaudited Reconciliation of Adjusted EBITDA to Net loss from Continued and Discontinued Operations", and "Unaudited Reconciliation of Long-Term Debt to Net Long-Term Debt and Net Leverage", at the end of this release.
| VERTEX ENERGY, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except number of shares and par value)
(UNAUDITED)
March 31, December 31,
2024 2023
------------------------------------------------------------ ------------------------------------------------
ASSETS
Current assets
$ 62,140 $ 76,967
Cash and cash equivalents
3,609 3,606
Restricted cash
41,559 36,164
Accounts receivable, net
198,979 182,120
Inventory
38,673 53,174
Prepaid expenses and other current assets
-------------------- -------------------- -------------------- -------------------- -------- --------------------
344,960 352,031
Total current assets
332,949 326,111
Fixed assets, net
63,524 64,499
Finance lease right-of-use assets
78,802 96,394
Operating lease right-of use assets
10,789 11,541
Intangible assets, net
4,029 4,048
Other assets
-------------------- -------------------- -------------------- -------------------- -------- --------------------
TOTAL ASSETS $ 835,053 $ 854,624
==================== ==================== ==================== ==================== ======== ====================
LIABILITIES AND EQUITY
Current liabilities
$ 69,796 $ 75,004
Accounts payable
69,240 73,636
Accrued expenses and other current liabilities
2,497 2,435
Finance lease liability-current
13,281 20,296
Operating lease liability-current
12,524 16,362
Current portion of long-term debt, net
169,656 141,093
Obligations under inventory financing agreements, net
-------------------- -------------------- -------------------- -------------------- -------- --------------------
336,994 328,826
Total current liabilities
177,772 170,701
Long-term debt, net
65,576 66,206
Finance lease liability-long-term
64,345 74,444
Operating lease liability-long-term
2,776 2,776
Deferred tax liabilities
3,249 9,907
Derivative warrant liability
1,377 1,377
Other liabilities
-------------------- -------------------- -------------------- -------------------- -------- --------------------
652,089 654,237
Total liabilities
EQUITY
Common stock, $0.001 par value per share;
94 94
750,000,000 shares authorized; 93,514,346 and 93,514,346 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively.
Additional paid-in capital 384,063 383,632
Accumulated deficit (205,113 ) (187,379 )
-------------------- -------------------- -------------------- -------------------- -------- --------------------
179,044 196,347
Total Vertex Energy, Inc. shareholders' equity
Non-controlling interest 3,920 4,040
-------------------- -------------------- -------------------- -------------------- -------- --------------------
182,964 200,387
Total equity
-------------------- -------------------- -------------------- -------------------- --------
| |
| VERTEX ENERGY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(UNAUDITED)
Three Months Ended March 31,
2024 2023
------------------------------------------------------ -----------------------------------------------
Revenues $ 695,326 $ 691,142
Cost of revenues (exclusive of depreciation and amortization shown separately below) 652,034 619,352
Depreciation and amortization attributable to costs of revenues 8,186 4,337
-------------------- -------------- -------------------- -------------------- ------- --------------------
Gross profit 35,106 67,453
Operating expenses:
Selling, general and administrative expenses (exclusive of depreciation and amortization shown separately below) 39,782 41,942
Depreciation and amortization attributable to operating expenses 1,104 1,016
-------------------- -------------- -------------------- -------------------- ------- --------------------
Total operating expenses 40,886 42,958
-------------------- -------------- -------------------- -------------------- ------- --------------------
Income (loss) from operations (5,780 ) 24,495
-------------------- -------------- -------------------- -------------------- ------- --------------------
Other income (expense):
(1,049 ) 1,653
Other income (expenses)
6,658 (9,185 )
Gain (loss) on change in value of derivative warrant liability
(17,683 ) (12,477 )
Interest expense
-------------------- -------------- -------------------- -------------------- ------- --------------------
Total other expense (12,074 ) (20,009 )
-------------------- -------------- -------------------- -------------------- ------- --------------------
Income (loss) from continuing operations before income tax (17,854 ) 4,486
Income tax expense -- (1,013 )
-------------------- -------------- -------------------- -------------------- ------- --------------------
Income (loss) from continuing operations (17,854 ) 3,473
Income from discontinued operations, net of tax (see note 22) -- 50,340
-------------------- -------------- -------------------- -------------------- ------- --------------------
Net income (loss) (17,854 ) 53,813
Net loss attributable to non-controlling interest from continuing operations (120 ) (50 )
-------------------- -------------- -------------------- -------------------- ------- --------------------
Net income (loss) attributable to Vertex Energy, Inc. (17,734 ) 53,863
-------------------- -------------- -------------------- -------------------- ------- --------------------
Net income (loss) attributable to common shareholders from continuing operations (17,734 ) 3,523
Net income attributable to common shareholders from discontinued operations, net of tax -- 50,340
-------------------- -------------- -------------------- -------------------- ------- --------------------
Net income (loss) attributable to common shareholders $ (17,734 ) $ 53,863
==================== ============== ==================== ==================== ======= ====================
Basic income (loss) per common share
$ (0.19 ) $ 0.05
Continuing operations
-- 0.66
Discontinued operations, net of tax
-------------------- -------------- -------------------- -------------------- ------- --------------------
Basic income (loss) per common share $ (0.19 ) $ 0.71
==================== ============== ==================== ==================== ======= ====================
Diluted income (loss) per common share
$ (0.19 ) $ 0.04
Continuing operations
-- 0.64
Discontinued operations, net of tax
-------------------- -------------- -------------------- -------------------- ------- --------------------
Diluted income (loss) per common share $ (0.19 ) $ 0.68
==================== ============== ==================== ==================== ======= ====================
Shares used in computing earnings per share
93,514 75,689
Basic
==================== ============== ==================== ==================== ======= ====================
| |
| VERTEX ENERGY, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
(in thousands, except par value)
(UNAUDITED)
Three Months Ended March 31, 2024
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Common Stock
-------------------------------------------------------------------- ---------------------------------- ------------------------------------------------------ ------------------------------------------------------ -----------------------------------------------
Shares $0.001 Par Additional Paid-In Capital Accumulated Deficit Non-controlling Interest Total Equity
-------------- ---------------------------------- ---------------------------------- ------------------------------------------------------ ------------------------------------------------------ -----------------------------------------------
Balance on January 1, 2024 93,515 $ 94 $ 383,632 $ (187,379 ) $ 4,040 $ 200,387
Stock based compensation expense -- -- 431 -- -- 431
Net loss -- -- -- (17,734 ) (120 ) (17,854 )
-------------- -------------------- -------------- -------------------- -------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ------- --------------------
| |
|
Three Months Ended March 31, 2023
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Common Stock
-------------------------------------------------------------------- ---------------------------------- ------------------------------------------------------ ------------------------------------------------------ -------------------- ------------------------------
Shares $0.001 Par Additional Paid-In Capital Accumulated Deficit Non-controlling Interest Total Equity
-------------- ---------------------------------- ---------------------------------- ------------------------------------------------------ ------------------------------------------------------ -------------------- --------------------------------------------------
Balance on January 1, 2023 75,670 $ 76 $ 279,552 $ (115,893 ) $ 1,685 $ 165,420
Exercise of options 166 -- 209 -- -- 209
Stock based compensation expense -- -- 365 -- -- 365
Non-controlling shareholder contribution -- -- -- -- 980 980
Net income (loss) -- -- -- 53,863 (50 ) 53,813
-------------- -------------------- -------------- -------------------- -------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ----------
| |
| VERTEX ENERGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(UNAUDITED)
Three Months Ended
March 31, March 31,
2024 2023
------------------------------------------------------ ------------------------------------------------------
Cash flows from operating activities
$ (17,854 ) $ 53,813
Net income (loss)
-- 50,340
Income from discontinued operations, net of tax
-------------------- -------------- -------------------- -------------------- -------------- --------------------
(17,854 ) 3,473
Income (loss) from continuing operations
Adjustments to reconcile net loss from continuing operations to cash used in operating activities
431 365
Stock based compensation expense
9,290 5,353
Depreciation and amortization
-- 1,013
Deferred income tax expense
35 --
Loss on lease modification
691 3
Loss on sale of assets
19 882
Increase in allowance for credit losses
(6,658 ) 9,185
Increase (decrease) in fair value of derivative warrant liability
1,322 (1,516 )
(Gain) loss on commodity derivative contracts
(2,292 ) 3,519
Net cash settlements on commodity derivatives
4,758 4,572
Amortization of debt discount and deferred costs
Changes in operating assets and liabilities
(4,180 ) (26,291 )
Accounts receivable and other receivables
(16,859 ) (52,553 )
Inventory
14,710 (18,103 )
Prepaid expenses and other current assets
(5,250 ) 11,005
Accounts payable
(7,308 ) 22,486
Accrued expenses
19 (44 )
Other assets
-------------------- -------------- -------------------- -------------------- -------------- --------------------
(29,126 ) (36,651 )
Net cash used in operating activities from continuing operations
-------------------- -------------- -------------------- -------------------- -------------- --------------------
Cash flows from investing activities
(14,726 ) (73,936 )
Purchase of fixed assets
-- 87,238
Proceeds from sale of discontinued operation
2,576 --
Proceeds from sale of fixed assets
-------------------- -------------- -------------------- -------------------- -------------- --------------------
(12,150 ) 13,302
Net cash provided by (used in) investing activities from continuing operations
-------------------- -------------- -------------------- -------------------- -------------- --------------------
Cash flows from financing activities
(586 ) (310 )
Payments on finance leases
-- 209
Proceeds from exercise of options and warrants to common stock
-- 980
Contributions received from noncontrolling interest
28,313 (11,284 )
Net change on inventory financing agreements
3,175 --
Proceeds from note payable
(4,450 ) (17,165 )
Payments on note payable
-------------------- -------------- -------------------- -------------------- -------------- --------------------
26,452 (27,570 )
Net cash provided by (used in) financing activities from continuing operations
-------------------- -------------- -------------------- -------------------- -------------- --------------------
Discontinued operations:
-- (150 )
Net cash provided by (used in) operating activities
-------------------- -------------- -------------------- -------------------- -------------- --------------------
-- (150 )
Net cash provided by (used in) discontinued operations
-------------------- -------------- -------------------- -------------------- -------------- --------------------
Net decrease in cash, cash equivalents and restricted cash (14,824 ) (51,069 )
Cash, cash equivalents, and restricted cash at beginning of the period 80,573 146,187
-------------------- -------------- -------------------- -------------------- -------------- --------------------
| |
The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the consolidated balance sheets to the same amounts shown in the consolidated statements of cash flows (in thousands).
| VERTEX ENERGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(UNAUDITED)
(Continued)
Three Months Ended
------------------------------------------------------------------------------------------------------------
March 31, March 31,
2024 2023
------------------------------------------------------ ------------------------------------------------------
Cash and cash equivalents $ 62,140 $ 86,689
Restricted cash 3,609 8,429
-------------------- -------------- -------------------- -------------------- --------------
Cash and cash equivalents and restricted cash as shown in the consolidated statements of cash flows $ 65,749 $ 95,118
==================== ============== ==================== ==================== ==============
SUPPLEMENTAL INFORMATION
Cash paid for interest $ 4,811 $ 10,124
==================== ============== ==================== ==================== ==============
Cash paid for taxes $ -- $ --
==================== ============== ==================== ==================== ==============
NON-CASH INVESTING AND FINANCING TRANSACTIONS
ROU assets obtained from new finance leases $ 18 $ 15,024
==================== ============== ==================== ==================== ==============
ROU assets obtained from new operating leases $ 74 $ 15,078
==================== ============== ==================== ==================== ==============
| |
Unaudited segment information for the three months ended March 31, 2024 and 2023 is as follows (in thousands):
| THREE MONTHS ENDED MARCH 31, 2024
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Refining & Black Oil & Recovery Corporate and Eliminations Total
Marketing
------------------------------------------------------ ------------------------------------------------------ ------------------------------------------------------ -------------------- -----------------------------------------------
Revenues:
$ 650,759 $ 31,724 $ (1,022 ) $ 681,461
Refined products
3,867 5,215 -- 9,082
Re-refined products
3,081 1,702 -- 4,783
Services
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ------- --------------------
Total revenues 657,707 38,641 (1,022 ) 695,326
Cost of revenues (exclusive of depreciation and amortization shown separately below) 622,974 30,082 (1,022 ) 652,034
Depreciation and amortization attributable to costs of revenues 6,541 1,645 -- 8,186
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ------- --------------------
28,192 6,914 -- 35,106
Gross profit
Selling, general and administrative expenses 26,147 5,397 8,238 39,782
Depreciation and amortization attributable to operating expenses 793 72 239 1,104
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ------- --------------------
1,252 1,445 (8,477 ) (5,780 )
Income (loss) from operations
Other income (expenses)
(685 ) (359 ) (5 ) (1,049 )
Other expense
-- -- 6,658 6,658
Gain on change in derivative liability
(4,747 ) (96 ) (12,840 ) (17,683 )
Interest expense
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ------- --------------------
(5,432 ) (455 ) (6,187 ) (12,074 )
Total other expense
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ------- --------------------
Income (loss) from continuing operations before income tax $ (4,180 ) $ 990 $ (14,664 ) $ (17,854 )
==================== ============== ==================== ==================== ============== ==================== ==================== ============== ==================== ==================== ======= ====================
| |
| THREE MONTHS ENDED MARCH 31, 2023
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Refining & Black Oil & Recovery Corporate and Eliminations Total
Marketing
------------------------------------------------------ ------------------------------------------------------ ------------------------------------------------------ -------------------- -----------------------------------------------
Revenues:
$ 653,042 $ 29,423 $ (2,733 ) $ 679,732
Refined products
4,353 4,411 -- 8,764
Re-refined products
1,933 713 -- 2,646
Services
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ------- --------------------
Total revenues 659,328 34,547 (2,733 ) 691,142
Cost of revenues (exclusive of depreciation and amortization shown separately below) 589,812 30,418 (878 ) 619,352
Depreciation and amortization attributable to costs of revenues 3,294 1,043 -- 4,337
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ------- --------------------
66,222 3,086 (1,855 ) 67,453
Gross profit
Selling, general and administrative expenses 26,486 4,799 10,657 41,942
Depreciation and amortization attributable to operating expenses 808 38 170 1,016
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ------- --------------------
38,928 (1,751 ) (12,682 ) 24,495
Income (loss) from operations
Other income (expenses)
-- 1,655 (2 ) 1,653
Other income (expense)
-- -- (9,185 ) (9,185 )
Loss on change in derivative liability
(3,876 ) (57 ) (8,544 ) (12,477 )
Interest expense
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ------- --------------------
(3,876 ) 1,598 (17,731 ) (20,009 )
Total other income (expense)
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- ------- --------------------
Income (loss) from continuing operations before income tax $ 35,052 $ (153 ) $ (30,413 ) $ 4,486
==================== ============== ==================== ==================== ============== ==================== ==================== ============== ==================== ==================== ======= ====================
| |
Unaudited Reconciliation of Gross Profit (Loss) From Continued and Discontinued Operations to Adjusted Gross Margin, Fuel Gross Margin, Fuel Gross Margin Per Barrel of Throughput and Operating Expenses Per Barrel of Throughput.
| Three Months Ended March 31, 2024
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
In thousands Conventional Renewable Renewable Mobile Refinery Total Mobile Refinery Total
---------------------------------------------- -------------------- ----------------------------------------------- --------------------- -----------------------------------------------
Gross profit $ 37,508 $ $ (10,462 ) $ $ 27,047
Unrealized (gain) loss on hedging activities (555 ) 934 379
Inventory valuation adjustments 9,657 4,592 14,249
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Adjusted gross margin $ 46,610 $ $ (4,936 ) $ $ 41,674
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Variable production costs attributable to cost of revenues 25,651 6,846 32,497
Depreciation and amortization attributable to cost of revenues 2,558 3,932 6,490
RINs (857 ) - (857 )
Realized (gain) loss on hedging activities 2,577 (1,783 ) 794
Financing costs (172 ) 132 (40 )
Other revenues (2,719 ) (362 ) (3,081 )
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Fuel gross margin $ 73,648 $ $ 3,829 $ $ 77,477
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Throughput (bpd) 64,065 4,090 68,155
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Fuel gross margin per barrel of throughput $ 12.63 $ $ 10.29 $ $ 12.49
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Total OPEX $ 16,061 $ $ 9,382 $ $ 25,443
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
| |
| Three Months Ended December 31, 2023
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
In thousands Conventional Renewable Renewable Mobile Refinery Total Mobile Refinery Total
---------------------------------------------- -------------------- ----------------------------------------------- --------------------- -----------------------------------------------
Gross profit $ 7,283 $ $ (17,557 ) $ $ (10,273 )
Unrealized (gain) loss on hedging activities 4,892 77 4,969
Inventory valuation adjustments (3,400 ) 2,152 (1,248 )
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Adjusted gross margin $ 8,775 $ $ (15,328 ) $ $ (6,553 )
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Variable production costs attributable to cost of revenues 19,770 19,497 39,267
Depreciation and amortization attributable to cost of revenues 2,492 3,997 6,489
RINs 6,662 - 6,662
Realized (gain) loss on hedging activities (3,751 ) (3,587 ) (7,338 )
Financing costs 1,989 157 2,146
Other revenues (6,361 ) (361 ) (6,722 )
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Fuel gross margin $ 29,576 $ $ 4,375 $ $ 33,951
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Throughput (bpd) 67,083 3,926 71,009
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Fuel gross margin per barrel of throughput $ 4.79 $ $ 12.11 $ $ 5.20
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Total OPEX $ 15,162 $ $ 9,868 $ $ 25,030
-------------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
| |
| Twelve Months Ended March 31, 2024
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
In thousands Conventional Renewable Renewable Mobile Refinery Total Mobile Refinery Total
----------------------------------------------- -------------------- ----------------------------------------------- --------------------- -----------------------------------------------
Gross profit $ 137,519 $ $ (49,540 ) $ $ 87,979
Unrealized (gain) loss on hedging activities 566 302 868
Inventory valuation adjustments 15,236 6,638 21,874
-------------------------------------------------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Adjusted gross margin $ 153,321 $ $ (42,600 ) $ $ 110,721
-------------------------------------------------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Variable production costs attributable to cost of revenues 100,954 39,378 140,332
Depreciation and amortization attributable to cost of revenues 11,383 13,267 24,650
RINs 38,273 - 38,273
Realized (gain) loss on hedging activities 530 (1,681 ) (1,151 )
Financing costs 3,502 552 4,054
Other revenues (19,494 ) (1,437 ) (20,931 )
-------------------------------------------------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Fuel gross margin $ 288,469 $ $ 7,479 $ $ 295,948
-------------------------------------------------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Throughput (bpd) 71,922 3,980 75,901
-------------------------------------------------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Fuel gross margin per barrel of throughput $ 10.96 $ $ 5.13 $ $ 10.65
-------------------------------------------------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
Total OPEX $ 72,242 $ $ 37,771 $ $ 110,013
-------------------------------------------------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- --------------------- -------------------- ------- --------------------
| |
Unaudited Reconciliation of Adjusted EBITDA to Net loss from Continued and Discontinued Operations.
| In thousands Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended
-------------------- ------------------------------------------------------------------------------------------------------------------ -------------------- -------------------------------------------------------------------------------------------------------------------
March 31, 2024 March 31, 2024 March 31, 2024 March 31, 2023 March 31, 2023 March 31, 2024 March 31, 2024 March 31, 2023 March 31, 2023
------------------------------------------------------- -------------------- ----------------------------------------------- -------------------- ----------------------------------------------- -------------------- ------------------------------------------------ -------------------- -----------------------------------------------
Net income (loss) $ $ (17,854 ) $ $ 53,813 $ $ (143,641 ) $ $ 56,619
Depreciation and amortization 9,290 5,498 35,102 22,527
Income tax expense (benefit) - 18,759 (13,462 ) 16,269
Interest expense 17,683 12,477 124,773 88,192
------------------------------------------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------
EBITDA $ $ 9,119 $ $ 90,547 $ $ 2,772 $ $ 183,607
------------------------------------------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------
Unrealized (gain) loss on hedging activities 445 (255 ) 448 (133 )
Inventory valuation adjustments 14,249 (1,532 ) 21,874 49,234
Gain on change in value of derivative warrant liability (6,658 ) 9,185 (23,835 ) (2,215 )
Stock-based compensation 430 365 2,350 1,689
(Gain) loss on sale of assets 691 (67,741 ) (2,446 ) (67,325 )
Acquisition costs - 4,308 - 16,275
Environmental clean-up reserve - - - 1,428
Other 358 0 (276 ) 280
------------------------------------------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- -------- -------------------- -------------------- -------------------- ------- --------------------
| |
| Three Months Ended March 31, 2024
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------ ---------------------- ------------------------------- -------------------- -------------------- ----------------------------------------------- -------------------- -----------------------------------------------
Mobile Refinery Legacy Refining & Marketing Legacy Refining & Marketing Total Refining & Marketing Total Refining & Marketing Black Oil and Recovery Black Oil and Recovery Corporate Corporate Corporate Consolidated Consolidated
-----------------------------------------------------------------------------------------------------------------
In thousands Conventional Renewable Renewable
---------------------------------------------- -------------------- ----------------------------------------------- --------------------------- ------------------------------ -------------------- -------------------------- ------------------------------------------------ ---------------------- ------------------------------- -------------------- -------------------- ----------------------------------------------- -------------------- -----------------------------------------------
Net income (loss) $ 17,535 $ $ (22,157 ) $ $ 442 $ $ $ (4,180 ) $ $ 990 $ $ $ (14,664 ) $ $ (17,854 )
Depreciation and amortization 3,330 3,953 51 7,334 1,717 239 9,290
Income tax expense (benefit) - - - - - - -
Interest expense 2,455 2,292 - 4,747 96 12,840 17,683
------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------------- -------------------- ---------- -------------------- -------------------------- -------------------- -------- -------------------- ---------------------- -------------------- ----------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
EBITDA $ 23,320 $ $ (15,912 ) $ $ 493 $ $ $ 7,901 $ $ 2,803 $ $ $ (1,585 ) $ $ 9,119
------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------------- -------------------- ---------- -------------------- -------------------------- -------------------- -------- -------------------- ---------------------- -------------------- ----------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
Unrealized (gain) loss on hedging activities (555 ) 934 20 399 46 - 445
Inventory valuation adjustments 9,657 4,592 - 14,249 - - 14,249
Gain on change in value of derivative warrant liability - - - - - (6,658 ) (6,658 )
Stock-based compensation - - - - - 430 430
(Gain) loss on sale of assets 685 - - 685 5 1 691
Other - - - - 354 4 358
------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------------- -------------------- ---------- -------------------- -------------------------- -------------------- -------- -------------------- ---------------------- -------------------- ----------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
| |
|
Three Months Ended December 31, 2023
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ -------------------- ----------------------------------------------- -------------------- -----------------------------------------------
Mobile Refinery Legacy Refining & Marketing Legacy Refining & Marketing Total Refining & Marketing Total Refining & Marketing Black Oil and Recovery Black Oil and Recovery Corporate Corporate Consolidated Consolidated
------------------------------------------------------------------------------------------------------------------
In thousands Conventional Renewable Renewable
----------------------------------------------- -------------------- ----------------------------------------------- --------------------------- ------------------------------------------------- -------------------------- ------------------------------------------------ ---------------------- ----------------------------------------------- -------------------- ----------------------------------------------- -------------------- -----------------------------------------------
Net income (loss) $ (11,112 ) $ $ (30,266 ) $ $ (2,424 ) $ $ (43,801 ) $ $ (1,670 ) $ $ (18,395 ) $ $ (63,865 )
Depreciation and amortization 3,252 4,017 313 7,582 1,476 167 9,225
Income tax expense (benefit) - - - - (517 ) 2,060 1,543
Interest expense 2,473 2,820 - 5,293 62 10,675 16,029
------------------------------------------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- --------------------------- -------------------- --------- -------------------- -------------------------- -------------------- -------- -------------------- ---------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
EBITDA $ (5,387 ) $ $ (23,429 ) $ $ (2,111 ) $ $ (30,926 ) $ $ (649 ) $ $ (5,493 ) $ $ (37,068 )
------------------------------------------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- --------------------------- -------------------- --------- -------------------- -------------------------- -------------------- -------- -------------------- ---------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
Unrealized (gain) loss on hedging activities 4,892 77 (7 ) 4,962 19 - 4,981
Inventory valuation adjustments (3,400 ) 2,152 - (1,248 ) - - (1,248 )
Gain on change in value of derivative warrant liability - - - - - (2,956 ) (2,956 )
Stock-based compensation - - - - - 783 783
(Gain) loss on sale of assets - - - - - 3 3
Acquisition costs - - - - - - -
Other - - - - 389 (1 ) 388
------------------------------------------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- --------------------------- -------------------- --------- -------------------- -------------------------- -------------------- -------- -------------------- ---------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
| |
|
Twelve Months Ended March 31, 2024
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ -------------------- ------------------------------------------------
Mobile Refinery Legacy Refining & Marketing Legacy Refining & Marketing Total Refining & Marketing Total Refining & Marketing Black Oil and Recovery Black Oil and Recovery Corporate Corporate Consolidated Consolidated
-----------------------------------------------------------------------------------------------------------------
In thousands Conventional Renewable Renewable Renewable
-------------------------- -------------------- -------------------- ----------------------------------------------- --------------------------- ------------------------------------------------- -------------------------- ------------------------------------------------ ---------------------- ----------------------------------------------- -------------------- ------------------------------------------------ -------------------- ------------------------------------------------
Net income (loss) $ 49,932 $ $ $ (94,694 ) $ $ (4,782 ) $ $ (49,544 ) $ $ 48,246 $ $ (142,343 ) $ $ (143,641 )
Depreciation and amortization 14,387 13,343 932 28,662 5,700 740 35,102
Income tax expense (benefit) - - - - 18,682 (32,144 ) (13,462 )
Interest expense 11,656 7,307 - 18,963 227 105,583 124,773
------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------------- -------------------- --------- -------------------- -------------------------- -------------------- -------- -------------------- ---------------------- -------------------- ------- -------------------- -------------------- -------------------- -------- -------------------- -------------------- -------------------- -------- --------------------
EBITDA $ 75,975 $ $ $ (74,044 ) $ $ (3,850 ) $ $ (1,919 ) $ $ 72,855 $ $ (68,164 ) $ $ 2,772
------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------------- -------------------- --------- -------------------- -------------------------- -------------------- -------- -------------------- ---------------------- -------------------- ------- -------------------- -------------------- -------------------- -------- -------------------- -------------------- -------------------- -------- --------------------
Unrealized (gain) loss on hedging activities 566 302 (2 ) 866 (418 ) - 448
Inventory valuation adjustments 15,236 6,638 - 21,874 - - 21,874
Gain on change in value of derivative warrant liability - - - - - (23,835 ) (23,835 )
Stock-based compensation - - - - - 2,350 2,350
(Gain) loss on sale of assets 685 - - 685 (69,224 ) 66,093 (2,446 )
Other - - - - (241 ) (35 ) (276 )
------------------------------------------------------- -------------------- ------ -------------------- -------------------- -------------------- ------- -------------------- --------------------------- -------------------- --------- -------------------- -------------------------- -------------------- -------- -------------------- ---------------------- -------------------- ------- -------------------- -------------------- -------------------- -------- -------------------- -------------------- -------------------- -------- --------------------
| |
Unaudited Reconciliation of Long-Term Debt to Net Long-Term Debt and Net Leverage.
| In thousands As of
March 31, 2024 March 31, 2023 March 31, 2023 December 31, 2023 December 31, 2023
----------------------------------------------- -------------------- ----------------------------------------------- -------------------- -----------------------------------------------
Long-Term Debt:
$ 15,230 $ $ 95,178 $ $ 15,230
Senior Convertible Note
195,950 152,138 195,950
Term Loan 2025
2,612 - -
Promissory Note
65,576 59,325 66,206
Finance lease liability long-term
2,497 1,916 2,435
Finance lease liability short-term
2,399 1,359 6,237
Insurance premiums financed
------------------------------------------------------ -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
Long-Term Debt and Lease Obligations $ 284,264 $ $ 309,916 $ $ 286,058
------------------------------------------------------ -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
(25,893 ) (77,596 ) (30,354 )
Unamortized discount and deferred financing costs
------------------------------------------------------ -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
Long-Term Debt and Lease Obligations per Balance Sheet $ 258,371 $ $ 232,320 $ $ 255,704
------------------------------------------------------ -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
(62,140 ) (86,689 ) (76,967 )
Cash and Cash Equivalents
(3,609 ) (8,429 ) (3,606 )
Restricted Cash
------------------------------------------------------ -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
Total Cash and Cash Equivalents $ (65,749 ) $ $ (95,118 ) $ $ (80,573 )
------------------------------------------------------ -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
Net Long-Term Debt $ 218,515 $ $ 214,798 $ $ 205,485
------------------------------------------------------ -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
Adjusted EBITDA $ 887 $ $ 182,898 $ $ 17,130
------------------------------------------------------ -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- ------- --------------------
| |
Note: Net Leverage is calculated using trailing twelve months Adjusted EBITDA
View source version on businesswire.com: https://www.businesswire.com/news/home/20240509304436/en/
SOURCE: Vertex Energy, Inc.
<img alt="" src="https://cts.businesswire.com/ct/CT?id=bwnews&sty=20240509304436r1&sid=cmtx6&distro=nx&lang=en" style="width:0;height:0" />
|
INVESTOR CONTACT
IR@vertexenergy.com
| |
COMTEX_452109326/1006/2024-05-09T06:00:03 |
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3.48% $0.04
