Aegean Marine Petroleum Network Inc. : Announces First Quarter 2012 Financial Results
05/16/2012| 04:25pm US/Eastern
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PIRAEUS, Greece, May 16, 2012 /PRNewswire/ -- Aegean Marine Petroleum Network Inc. (NYSE: ANW) ("Aegean" or the "Company") today announced financial and operating results for the first quarter ended March 31, 2012.
First Quarter and Year-to-Date Highlights
-- Recorded sales volumes of 2,461,230.
-- Expanded gross profit to $76.4 million.
-- Reported operating income of $13.4 million.
-- Increased net income attributable to AMPNI shareholders to $6.0 million
or $0.13 basic and diluted earnings per share.
-- Expanded EBITDA (as defined in Note 1) to $22.5 million in Q1 2012.
-- Completed newbuild program with the delivery of the Symi in April 2012.
-- Formed strategic alliance extending global reach to mainland China.
The Company recorded net income attributable to AMPNI shareholders for the three months ended March 31, 2012 of $6.0 million, or $0.13 basic and diluted earnings per share. For purposes of comparison, the Company reported net income of $4.0 million, or $0.09 basic and diluted earnings per share, for the three months ended March 31, 2011. The weighted average basic and diluted shares outstanding for the three months ended March 31, 2012 were 45,438,383. The weighted average basic and diluted shares outstanding for the three months ended March 31, 2011 were 46,266,117.
Total revenues for the three months ended March 31, 2012, increased by 12.3% to $1,810.9 million compared to $1,611.9 million for the same period in 2011. For the three months ended March 31, 2012, sales of marine petroleum products increased by 12.1% to $1,799.3 million compared to $1,605.4 million for the year-earlier period. Gross profit, which equals total revenue less directly attributable cost of revenue increased by 19.0% to $76.4 million in the first quarter of 2012 compared to $64.2 million in the year-earlier period.
For the three months ended March 31, 2012, the volume of marine fuel sold decreased by 9.7% to 2,461,230 metric tons as compared to 2,726,237 metric tons in the year-earlier period as the Company maintained its focus on executing transactions with creditworthy counterparties.
Operating income for the first quarter of 2012 increased to $13.4 million as compared to $9.8 million for the same period in 2011. Operating expenses, excluding directly attributable cost of revenue, increased by $8.6 million, or 15.8%, to $63.0 million for the three months ended March 31, 2012 as compared to $54.4 million for the same period in 2011. This increase was principally due to an expanded logistics infrastructure.
E. Nikolas Tavlarios, President, commented, "Our results for the first quarter reflect the continued progress Aegean has achieved implementing its strategy aimed at steadily increasing profitability during a challenging market environment. For the three months ended March 31, 2012, we improved gross spread for the fifth consecutive quarter as we remain focused on executing transactions in a disciplined manner with creditworthy counterparties, streamlining our global operations and capitalizing on the demand for our comprehensive services. Consistent with our objective to expand Aegean's worldwide integrated marine fuel logistics chain, we recently completed our previously announced newbuilding program, a major milestone that further strengthens our Company's leading industry brand. We also entered into a strategic alliance that effectively extends our global reach to mainland China without incrementally increasing capital expenditures. With one of the largest double-hull bunkering delivery fleets in the world, combined with our increasing global scale, we have enhanced Aegean's potential to generate significant operating leverage and drive future earnings growth."
Liquidity and Capital Resources
As of March 31, 2012, the Company had cash and cash equivalents of $29.8 million and working capital of $77.2 million. Non-cash working capital, or working capital excluding cash and debt, was $541.2 million as of December 31, 2011.
Net cash used in operating activities was $28.7 million for the three months ended March 31, 2012. Net income, as adjusted for non-cash items, was $19.5 million for the period.
Net cash used in investing activities was $11.0 million for the three months ended March 31, 2012, mainly due to the advances for other fixed assets under construction.
Net cash provided by financing activities was $0.3 million for the three months ended March 31, 2012, primarily driven by the increase in net borrowings.
As of March 31, 2012, the Company had $223.2 million in available liquidity, which includes unrestricted cash and cash equivalents and available undrawn amounts under the Company's working capital facilities, to finance working capital requirements.
Spyros Gianniotis, Chief Financial Officer, stated, "During the first quarter, we utilized our substantial liquidity, which includes more than $940 million in total working capital credit facilities, to manage higher bunkering fuel prices and continue to provide first-rate service to credit worthy customers. Our strong financial foundation, combined with the ongoing support we have received from our lending group, provide a competitive advantage that assists Aegean in meeting the significant working capital requirements in the global marine fuel supply industry. Going forward, we will continue to strengthen our balance sheet as we seek opportunities to increase profitability in our existing locations and further expand our vast network by entering new and attractive markets for the benefit of shareholders."
Subsequent to the quarter ended March 31, 2012, the Company sold the Vera, a single hull bunkering tanker and the Fos, a floating storage facility. With these separate transactions, the Company recorded a book loss of $4.7 million while generating cash proceeds of approximately $5.8 million and eliminating annual operating expenses of nearly $5 million related to these vessels.
Summary Consolidated Financial and Other Data (Unaudited)
For the Three Months Ended
March 31,
--------------------------
2011 2012
---- ----
Income Statement Data:
Revenues - third parties $1,594,280 $1,792,925
Revenues - related companies 17,627 17,990
------ ------
Total revenues 1,611,907 1,810,915
Cost of revenue (exclusive of items
shown separately below) -third
parties 1,466,524 1,648,321
Cost of revenue (exclusive of items
shown separately below) - related
companies 81,216 86,193
------ ------
Total cost of sales 1,547,740 1,734,514
Gross profit 64,167 76,401
Selling and distribution 47,243 55,560
General and administrative 6,771 7,060
Amortization of intangible assets 353 376
Loss on sale of vessels, net 20 -
--- ---
Operating income 9,780 13,405
Net financing cost (5,729) (8,553)
Foreign exchange gains, net 322 1,654
Income taxes (329) (225)
---- ----
Net income 4,044 6,281
----- -----
Less income attributable to non-
controlling interest - 276
--- ---
Net income attributable to AMPNI
shareholders $4,044 $6,005
====== ======
Basic earnings per share (U.S.
dollars) $0.09 $0.13
Diluted earnings per share (U.S.
dollars) $0.09 $0.13
EBITDA(1) $17,369 $22,532
Other Financial Data:
Gross spread on marine petroleum
products(2) $61,664 $68,927
Gross spread on lubricants(2) 508 746
Gross spread on marine fuel(2) 61,156 68,181
Gross spread per metric ton of marine 22.4 27.7
fuel sold (U.S. dollars) (2)
Net cash used in operating activities $52,759 $28,658
Net cash used in investing activities 10,883 10,978
Net cash provided by financing
activities 10,432 303
Sales Volume Data (Metric Tons): (3)
Total sales volumes 2,726,237 2,461,230
--------- ---------
Other Operating Data:
Number of owned bunkering tankers,
end of period(4) 54.0 58.0
Average number of owned bunkering
tankers(4)(5) 53.6 58.0
Special Purpose Vessels, end of
period(6) 1.0 1.0
Number of owned storage facilities,
end of period(7) 8.0 8.0
Summary Consolidated Financial and Other Data (Unaudited)
As of As of
December 31, 2011 March 31, 2012
----------------- --------------
(in thousands of U.S.
dollars,
unless otherwise
stated)
Balance Sheet Data:
Cash and cash
equivalents 68,582 29,791
Gross trade
receivables 526,450 539,048
Allowance for
doubtful accounts (1,354) (3,210)
Inventories 204,057 244,910
Current assets 851,991 866,785
Total assets 1,472,438 1,489,792
Trade payables 250,810 256,097
Current liabilities
(including current
portion of long-
term debt) 650,810 789,558
Total debt 706,916 708,423
Total liabilities 992,896 1,003,502
Total stockholder's
equity 479,542 486,290
Working Capital Data:
Working capital(8) 201,181 77,227
Working capital
excluding cash and
debt(8) 497,925 541,185
1. EBITDA represents net income before
interest, taxes, depreciation and
amortization. EBITDA does not
represent and should not be
considered as an alternative to
net income or cash flow from
operations, as determined by
United States generally accepted
accounting principles, or U.S.
GAAP, and our calculation of
EBITDA may not be comparable to
that reported by other companies.
EBITDA is included herein because
it is a basis upon which the
Company assesses its operating
performance and because the
Company believes that it presents
useful information to investors
regarding a company's ability to
service and/or incur
indebtedness. The following table
reconciles net income to EBITDA
for the periods presented:
For the Three
Months Ended
March 31,
-------------
2011 2012
---- ----
Net income attributable to AMPNI
shareholders 4,044 6,005
Add: Net financing cost 5,729 8,553
Add: Income tax expense 329 225
Add: Depreciation and
amortization 7,267 7,749
EBITDA 17,369 22,532
====== ======
2. Gross spread on marine petroleum
products represents the margin the
Company generates on sales of
marine fuel and lubricants. Gross
spread on marine fuel represents
the margin that the Company
generates on sales of various
classifications of marine fuel oil
("MFO") or marine gas oil ("MGO").
Gross spread on lubricants
represents the margin that the
Company generates on sales of
lubricants. The Company calculates
the above-mentioned gross spreads
by subtracting from the sales of
the respective marine petroleum
product the cost of the respective
marine petroleum product sold and
cargo transportation costs. For
arrangements in which the Company
physically supplies the respective
marine petroleum product using its
bunkering tankers, costs of the
respective marine petroleum
products sold represents amounts
paid by the Company for the
respective marine petroleum
product sold in the relevant
reporting period. For arrangements
in which the respective marine
petroleum product is purchased
from the Company's related
company, Aegean Oil S.A., or
Aegean Oil, cost of the respective
marine petroleum products sold
represents the total amount paid
by the Company to the physical
supplier for the respective marine
petroleum product and its delivery
to the custom arrangements in
which the Company purchases cargos
of marine fuel for its floating
storage facilities, transportation
costs may be included in the
purchase price of marine fuels
from the supplier or may be
incurred separately from a
transportation provider.
Gross spread per metric ton of
marine fuel sold represents the
margin the Company generates per
metric ton of marine fuel sold.
The Company calculates gross
spread per metric ton of marine
fuel sold by dividing the gross
spread on marine fuel by the sales
volume of marine fuel. Marine fuel
sales do not include sales of
lubricants. The following table
reflects the calculation of gross
spread per metric ton of marine
fuel sold for the periods
presented:
For the Three Months Ended
March 31
--------------------------
2011 2012
---- ----
Sales of marine petroleum
products 1,605,351 1,799,329
Less: Cost of marine
petroleum products sold (1,543,687) (1,730,402)
Gross spread on marine
petroleum products 61,664 68,927
Less: Gross spread on
lubricants (508) (746)
---- ----
Gross spread on marine fuel 61,156 68,181
Sales volume of marine fuel
(metric tons) 2,726,237 2,461,230
--------- ---------
Gross spread per metric ton
of marine 22.4 27.7
fuel sold (U.S. dollars)
3. Sales volume of marine fuel is the
volume of sales of various
classifications of MFO and MGO for
the relevant period and is
denominated in metric tons. The
Company does not use the sales
volume of lubricants as an
indicator.
The Company's markets include its
physical supply operations in the
United Arab Emirates, Gibraltar,
Jamaica, Singapore, Northern
Europe, Ghana, Vancouver, Montreal,
Mexico, Portland (U.K.), Trinidad
and Tobago (Southern Caribbean),
Tangiers (Morocco), Las Palmas,
Cape Verde, Tenerife, Panama and
Greece, where the Company conducts
operations through its related
company, Aegean Oil.
4. Bunkering fleet comprises both
bunkering vessels and barges.
5. Figure represents average bunkering
fleet number for the relevant
period, as measured by the sum of
the number of days each bunkering
tanker or barge was used as part of
the fleet during the period divided
by the cumulative number of
calendar days in the period
multiplied by the number of
bunkering tankers at the end of the
period. This figure does not take
into account non-operating days
due to either scheduled or
unscheduled maintenance.
6. Special Purpose Vessels consists of
the Orion, a 550 dwt tanker which
is based in our Greek market.
7. As of March 31,2012 the Company
operated two Panamax tankers, the
Fos II and the Aeolos, and one
Aframax tanker, the Leader as
floating storage facilities in
Ghana, Gibraltar and United Arab
Emirates. Additionally, the Company
operates a barge, the
Mediterranean, as a floating
storage facility in Greece and a
small tanker, the Tapuit, as a
floating storage facility in
Northern Europe. The Company also
has on-land storage facilities in
Portland, Las Palmas and Panama.
The ownership of storage facilities
allows the Company to mitigate its
risk of supply shortages.
Generally, storage costs are
included in the price of refined
marine fuel quoted by local
suppliers. The Company expects that
the ownership of storage facilities
will allow it to convert the
variable costs of this storage fee
mark-up per metric ton quoted by
suppliers into fixed costs of
operating its owned storage
facilities, thus enabling the
Company to spread larger sales
volumes over a fixed cost base and
to decrease its refined fuel costs.
8. Working capital is defined as
current assets minus current
liabilities. Working capital
excluding cash and debt is defined
as current assets minus cash and
cash equivalents minus restricted
cash minus current liabilities plus
short-term borrowings plus current
portion of long-term debt.
First Quarter 2012 Dividend Announcement
On May 16, 2012, the Company's Board of Directors declared a first quarter 2012 dividend of $0.01 per share payable on June 13, 2012 to shareholders of record as of May 30, 2012. The dividend amount was determined in accordance with the Company's dividend policy of paying cash dividends on a quarterly basis subject to factors including the requirements of Marshall Islands law, future earnings, capital requirements, financial condition, future prospects and such other factors as are determined by the Company's Board of Directors. The Company anticipates retaining most of its future earnings, if any, for use in operations and business expansion.
Conference Call and Webcast Information
Aegean Marine Petroleum Network Inc. will conduct a conference call and simultaneous Internet webcast on Thursday, May 17, 2012 at 8:30 a.m. Eastern Time, to discuss its first quarter results. Investors may access the webcast and related slide presentation, by visiting the Company's website at www.ampni.com, and clicking on the webcast link. The conference call also may be accessed via telephone by dialing (888) 811-5436 (for U.S.-based callers) or (913) 312-0377 (for international callers) and enter the passcode: 7464610.
A replay of the webcast will be available soon after the completion of the call and will be accessible on www.ampni.com. A telephone replay will be available through May 31, 2012 by dialing (888) 203-1112 or (for U.S.-based callers) or (719) 457-0820 (for international callers) and enter the passcode: 7464610.
About Aegean Marine Petroleum Network Inc.
Aegean Marine Petroleum Network Inc. is an international marine fuel logistics company that markets and physically supplies refined marine fuel and lubricants to ships in port and at sea. The Company procures product from various sources (such as refineries, oil producers, and traders) and resells it to a diverse group of customers across all major commercial shipping sectors and leading cruise lines. Currently, Aegean has a global presence in 19 markets, including Vancouver, Montreal, Mexico, Jamaica, Trinidad and Tobago, West Africa, Gibraltar, U.K., Northern Europe, Piraeus, Patras, the United Arab Emirates, Singapore, Morocco, the Antwerp-Rotterdam-Amsterdam (ARA) region, Las Palmas, Tenerife, Cape Verde and Panama. The Company has also formed a strategic alliance to extend its global reach to China. To learn more about Aegean, visit http://www.ampni.com.
Cautionary Statement Regarding Forward-Looking Statements
Matters discussed in this press release may constitute forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts.
The Company desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with this safe harbor legislation. The words "believe," "intend," "anticipate," "estimate," "project," "forecast," "plan," "potential," "may," "should," "expect" and similar expressions identify forward-looking statements. The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, our management's examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs or projections.
In addition to these important factors, other important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include our ability to manage growth, our ability to maintain our business in light of our proposed business and location expansion, our ability to obtain double hull secondhand bunkering tankers, the outcome of legal, tax or regulatory proceedings to which we may become a party, adverse conditions in the shipping or the marine fuel supply industries, our ability to retain our key suppliers and key customers, material disruptions in the availability or supply of crude oil or refined petroleum products, changes in the market price of petroleum, including the volatility of spot pricing, increased levels of competition, compliance or lack of compliance with various environmental and other applicable laws and regulations, our ability to collect accounts receivable, changes in the political, economic or regulatory conditions in the markets in which we operate, and the world in general, our failure to hedge certain financial risks associated with our business, our ability to maintain our current tax treatments and our failure to comply with restrictions in our credit agreements and other factors. Please see our filings with the Securities and Exchange Commission for a more complete discussion of these and other risks and uncertainties.
SOURCE Aegean Marine Petroleum Network Inc.
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