AEGEAN MARINE PETROLEUM NETWORK INC. NEW YORK, May 23, 2017 /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, 2017.
First Quarter Financial Highlights
-- Recorded sales volumes of 4,450,263 metric tons.
-- Achieved gross profit of $80.3 million.
-- Generated operating income of $13.9 million.
-- Recorded net income attributable to Aegean shareholders of $1.4 million
or $0.03 basic and diluted earnings per share.
-- Generated EBITDA of $21.9 million.
First Quarter Operational Highlights
E. Nikolas Tavlarios, Aegean's President, commented, "Our results in the quarter were impacted by increased competition across operations and continued challenging market dynamics. These results do not reflect the overall strength of our business or our strong track record of delivering consistent growth and stable financial results. To position Aegean for continued success, we are actively managing our business and taking decisive action to improve performance despite industry headwinds. We are controlling what we can control by shifting our strategy towards a more\ asset-light model and taking a strategic view of our operations to enhance efficiency. Consistent with our focus of actively managing our fleet, we are marketing several vessels for sale, charter, or redeployment to the highest growth areas. We are confident that these initiatives, once fully implemented, will drive improved performance and value creation."
Financial Results
-- Revenue - The Company reported total revenue of $1.5 billion for the
first quarter of 2017, an increase of 102.5% compared to the same period
in 2016, primarily due to the increase in oil prices. Voyage and other
revenues were, $20.0 million, approximately $1.9 million more than the
same period in 2016.
-- Gross Profit - Gross Profit, which equals total revenue less directly
attributable cost of revenue decreased by 0.7% to $80.3 million in the
first quarter of 2017 compared to $80.9 million in the same period in
2016.
-- Operating Expense - The Company reported operating expense of $66.5
million for the first quarter of 2017, an increase of $3.9 million or
6.2% compared to the same period in prior year due mainly to higher
marine fuel costs for our fleet and additional offices.
-- Operating Income - Operating income for the first quarter of 2017 was
$13.9 million, a decrease of 4.4 million or 24.0% compared to the same
period in prior year.
-- Net Income - Net income attributable to Aegean shareholders for the
three months ended March 31, 2017 was $1.4 million, or $0.03 per basic
and diluted share, a decrease of $10.4 million or 88.1% compared to the
same period in 2016 due mainly to higher operating expenses and finance
costs.
Operational Metrics
-- Sales Volume - For the three months ended March 31, 2017, the Company
reported marine fuel sales volumes of 4,450,263 metric tons, an increase
of 5.6% compared to the same period in 2016.
-- EBITDA Per Metric Ton of Marine Fuel Sold - For the three months ended
March 31, 2017, the Company reported EBITDA per metric ton of marine
fuel sold of $4.93. EBITDA per metric ton of marine fuel sold in the
prior year period was $6.44 per metric ton.
-- Gross Spread Per Metric Ton of Marine Fuel Sold - For the three months
ended March 31, 2017, the Company reported gross spread per metric ton
of marine fuel sold on an aggregate basis of $16.3. Gross spread per
metric ton of marine fuel sold in the prior year period was $17.6.
Liquidity and Capital Resources
-- Net cash used in operating activities was $67.1 million for the three
months ended March 31, 2017 due mainly to higher sales volumes in the
U.S. and Northern Europe.
-- Net income as adjusted for non-cash items (as defined in Note 9 below)
was $3.9 million for the same period.
-- Net cash used in investing activities was $2.8 million for the three
months ended March 31, 2017, primarily due to advances for fixed assets
under construction.
-- Net cash provided by financing activities was $36.4 million for the
three months ended March 31, 2017, primarily due to higher sales
volumes.
-- As of March 31, 2017, the Company had cash and cash equivalents of $60.4
million and working capital of $432.4 million. Non-cash working capital,
or working capital excluding cash and debt, was $708.2 million.
-- As of March 31, 2017, the Company had $836.5 million undrawn amounts
under its working capital facilities and $60.4 million of unrestricted
cash and cash equivalents to finance working capital requirements.
-- The weighted average basic and diluted shares outstanding for the three
months ended March 31, 2017 was 37,735,380. The weighted average basic
and diluted shares outstanding for the three months ended March 31, 2016
was 47,545,710.
Spyros Gianniotis, Aegean's Chief Financial Officer, stated, "During the quarter, we maintained our financial flexibility and balance sheet strength, as we have done throughout various market conditions. To further enhance profitability, we are actively evaluating our markets to redeploy assets and capital to opportunities we believe will generate the best return and accelerate our initiatives to rationalize expenses. "
Summary Consolidated Financial and Other Data (Unaudited)
For the Three Months Ended March
31,
2016 2017
---- ----
(in thousands of U.S.dollars,
unless
otherwise stated)
Income
Statement
Data:
Revenues
-third
parties $748,516 $1,519,025
Revenues
-
related
companies 4,416 5,233
----- -----
Total
revenues 752,932 1,524,258
Cost of
revenues
-
third
parties 661,626 1,424,280
Cost of
revenues-
related
companies 10,438 19,645
------ ------
Total
cost of
revenues 672,064 1,443,925
------- ---------
Gross
profit 80,868 80,333
------ ------
Operating
expenses:
Selling
and
distribution 50,772 54,885
General
and
administrative 11,496 11,415
Amortization
of
intangible
assets 300 167
Operating
income 18,300 13,866
Net
financing
cost (9,361) (12,073)
Foreign
exchange
gains,
net 239 307
Income
taxes
benefit
/
(expense) 2,592 (729)
----- ----
Net
income 11,770 1,371
------ -----
Less
income
attributable
to non-
controlling
interest - 17
--- ---
Net
income
attributable
to
AMPNI
shareholders $11,770 $1,354
======= ======
Basic
earnings
per
share
(U.S.
dollars) $0.24 $0.03
Diluted
earnings
per
share
(U.S.
dollars) $0.24 $0.03
EBITDA(1) $27,147 $21,938
Other
Financial
Data:
Gross
spread
on
marine
petroleum
products(2) $75,068 $73,151
Gross
spread
on
lubricants(2) 734 626
Gross
spread
on
marine
fuel(2) 74,334 72,525
Gross
spread
per
metric
ton of
marine 17.6 16.3
fuel
sold
(U.S.
dollars)
(2)
Net cash
provided
by /
(used)
in
operating
activities $10,944 $(67,090)
Net cash
(used
in) /
provided
by
investing
activities (8,755) (2,842)
Net cash
(used
in) /
provided
by
financing
activities (6,024) 36,353
Sales
Volume
Data
(Metric
Tons):
(3)
Total
sales
volumes 4,212,636 4,450,263
--------- ---------
Other
Operating
Data:
Number
of
owned
bunkering
tankers,
end of
period(4) 49.0 45.0
Average
number
of
owned
bunkering
tankers(4)(5) 49.0 45.0
Special
Purpose
Vessels,
end of
period(6) 1.0 1.0
Number
of
operating
storage
facilities,
end of
period(7) 14.0 12.0
Summary Consolidated Financial and Other Data (Unaudited)
As of As of
December 31, March 31,
2016 2017
---- ----
(in thousands of U.S.
dollars,
unless otherwise stated)
Balance Sheet
Data:
Cash and cash
equivalents 93,836 60,391
Gross trade
receivables 512,398 627,176
Allowance for
doubtful
accounts (8,647) (9,411)
Inventories 187,766 172,342
Total Current
assets 909,252 963,282
Total assets 1,600,933 1,651,216
Trade payables 131,584 141,890
Total Current
liabilities
(including
current portion
of long-term 497,712 530,836
debt)
Total debt 817,631 853,309
Total liabilities 1,011,342 1,055,260
Total
stockholder's
equity 589,591 595,956
Working Capital
Data:
Working
capital(8) 411,540 432,446
Working capital
excluding cash
and debt(8) 629,370 708,231
Notes:
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
recorded by other companies.
Adjusted EBITDA represents net
income before interest, taxes,
depreciation and amortization,
vessel and investment
impairments, gains/losses on
vessel disposals and other non-
recurring exceptional items.
EBITDA and Adjusted EBITDA are
included herein because they are
a basis upon which the Company
assesses its operating
performance.
Adjusted EBITDA per metric ton of
marine fuel sold represents the
net income before interest,
taxes, depreciation and
amortization, vessel and
investment impairments, gains/
losses on vessel disposals and
other non-recurring exceptional
items the Company generates per
metric ton of marine fuel sold.
The Company calculates Adjusted
EBITDA per metric ton of marine
fuel sold by dividing the EBITDA
by the sales volume of marine
fuel. Marine fuel sales do not
include sales of lubricants.
The following table reconciles
net income attributable to AMPNI
to EBITDA, Adjusted EBITDA and
Adjusted EBITDA per metric ton
of marine fuel sold for the
periods presented:
For the Three Months Ended March 31,
------------------------------------
2016 2017
---- ----
(in thousands of U.S. dollars,
unless otherwise stated)
Net income to AMPNI shareholders 11,770 1,354
Add: Net financing cost including amortization of financing costs 9,361 12,073
Add: Income tax (benefit) / expense (2,592) 729
Add: Depreciation and amortization excluding amortization of financing 8,608 7,782
costs
EBITDA 27,147 21,938
------ ------
Add: Non-recurring exceptional items - -
--- ---
Adjusted EBITDA 27,147 21,938
------ ------
Sales volume of marine fuel (metric tons) 4,212,636 4,450,263
--------- ---------
Adjusted EBITDA per metric ton of marine 6.44 4.93
fuel sold (U.S. dollars)
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. Gross spread on marine
petroleum products, gross spread
of MFO and gross spread on
lubricants are not items
recognized by U.S. GAAP and should
not be considered as an
alternative to gross profit or any
other indicator of a Company's
operating performance required by
U.S. GAAP. The Company's
definition of gross spread may not
be the same as that used by other
companies in the same or other
industries. 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,
---------
2016 2017
---- ----
(in thousands of U.S.
dollars,
unless otherwise stated)
Sales of marine petroleum
products 734,815 1,504,241
Less: Cost of marine
petroleum products sold (659,747) (1,431,090)
-------- ----------
Gross spread on marine
petroleum products 75,068 73,151
Less: Gross spread on
lubricants (734) (626)
---- ----
Gross spread on marine fuel 74,334 72,525
Sales volume of marine fuel
(metric tons) 4,212,636 4,450,263
--------- ---------
Gross spread per metric ton
of marine 17.6 16.3
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 include the sales
volume of lubricants in the
calculation of gross spread per
metric ton of marine fuel sold.
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. The Company owns two barges, the
Mediterranean and Umnenga, as
floating storage facilities in
Greece and South Africa. The
Company also operates on-land
storage facilities in Las Palmas,
Fujairah, Tangiers, the U.S.A. and
Hamburg.
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.
9. Net income as adjusted for non-
cash items, such as depreciation,
provision for doubtful accounts,
share-based compensation,
amortization, deferred income
taxes, gain/loss on sale of
vessels, impairment losses,
unrealized loss/(gain) on
derivatives and unrealized foreign
exchange loss/(gain), net, is
used to assist in evaluating our
ability to make quarterly cash
distributions. Net income as
adjusted for non-cash items is
not recognized by accounting
principles generally accepted in
the United States and should not
be considered as an alternative to
net income or any other indicator
of the Company's performance
required by accounting principles
generally accepted in the United
States. The following table
reflects the calculation of net
income as adjusted for non-cash
items for the periods presented:
For the Three Months Ended
March 31,
---------
2016 2017
---- ----
(in thousands of U.S. dollars,
unless otherwise stated)
Net income 11,770 1,371
Add: Depreciation 6,439 5,875
Add: Provision for doubtful
accounts 781 764
Add: Share based compensation 2,409 1,884
Add: Amortization 4,566 4,976
Add: Net deferred tax (benefit) /
expense (2,879) 3,612
Add: Unrealized loss /(gain) on
derivatives 27,628 (14,606)
Add: Unrealized foreign exchange
loss 207 70
Net income as adjusted for non-
cash items 50,921 3,946
====== =====
First Quarter 2017 Dividend Announcement
On May 23, 2017, the Company's Board of Directors declared a first quarter 2017 dividend of $0.02 per share payable on or about June 20, 2017 to shareholders of record as of June 6, 2017. 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 Wednesday, May 24(th) 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 (800) 862-9098 (for U.S.-based callers) or 785-424-1051 (for international callers) and enter the passcode: 9327926.
If you are unable to participate at this time, a replay of the call will be available for two weeks at 888-203-1112 or 719-457-0820. Enter the code 9327926 to access the audio replay. The webcast will also be archived on the Company's website:
http://www.ampni.com.
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 over 29 markets and a team of professionals ready to serve our customers wherever they are around the globe. For additional information please visit: 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.
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SOURCE Aegean Marine Petroleum Network Inc.
