HOUSTON, May 8, 2019
/PRNewswire/ -- Adams Resources & Energy, Inc. (NYSE AMERICAN:
AE) ("Adams" or the "Company") today announced its financial
results for the three months ended March 31, 2019.
The Company reported net earnings of $4.9
million, or $1.16 per common
share, on revenues of $445.2 million
for the first quarter of 2019, compared to net earnings of
$1.1 million, or $0.27 per common share, on revenues of
$387.3 million for the first quarter
of 2018. On an adjusted basis, net earnings were $1.0 million, or $0.23 per common share, for the first quarter of
2019, compared to net earnings of $0.7
million, or $0.16 per common
share, for the first quarter of 2018.
Adjusted net (losses) earnings, adjusted (losses) earnings per
common share and adjusted cash flow are non-generally accepted
accounting principle ("non-GAAP") financial measures that are
defined and reconciled in the financial tables below.
First Quarter 2019 Highlights:
- Gross revenues were approximately $445.2
million for the first quarter of 2019 compared to
$387.3 million for the first quarter
of 2018
- Our crude oil marketing subsidiary, GulfMark Energy, Inc.,
marketed approximately 113,279 per day ("bpd") of crude oil during
the first quarter of 2019, compared to 65,194 bpd of crude oil
during the first quarter of 2018
- Cash and cash equivalents increased by approximately 12 percent
from December 31, 2018 of
$117.1 million to approximately
$130.9 million at March 31, 2019
- $55.4 million of undrawn capacity
under our letter of credit facility at March
31, 2019
- Adjusted cash flow of $4.9
million for the first quarter of 2019 compared to
$3.3 million for the first quarter of
2018
- Approximately 452,874 barrels of crude oil inventory at
March 31, 2019 compared to 415,523
barrels at December 31, 2018
- No short or long term debt as of March
31, 2019
"During the first quarter of 2019, our Service Transport
business unit continued to generate improved financial and
operating results as our revenue per mile increased 13 percent from
the first quarter of 2018, but decreased 3 percent from the fourth
quarter of 2018," said Townes G.
Pressler, Executive Chairman. "As customer demand
continues to be strong in this segment, improved trucking rates
allow improved hiring and retention of skilled drivers as we
continue to provide dependable superior service to our customers at
Service Transport. We are continuing on schedule with
improving the age of our fleet, with the purchase of 40 new
tractors during the first quarter of 2019 and commitments to
purchase an additional 42 tractors and 73 trailers during
2019."
"At our GulfMark business unit, crude oil marketing volumes for
the first quarter of 2019 increased 2 percent from the fourth
quarter of 2018 and increased 74 percent from the first quarter of
2018, primarily as a result of the acquisition of a crude oil
gathering operation during October
2018, coupled with increased production in our market
areas. We have seen some increase in marketing margins as a
result of improved marketing conditions."
"During the remainder of 2019, we will remain focused on safety
first and remaining in the top tier for all safety
statistics. We will be introducing efficiencies in our crude
oil marketing division, integrating our crude oil gathering company
acquisition into our business, replacing aging tractors and right
sizing our tractor and trailer fleets in both business units, and
improving company-wide driver recruitment and retention, and
increasing our driver count. We will continue to explore
synergic growth opportunities in our core businesses, both
organically and in the open market," continued Pressler.
Capital Investments
During the first quarter of 2019, the Company spent
approximately $8.4 million of capital
and paid dividends of $0.9 million
($0.22 per common share). The
majority of the capital costs relate to the purchase of tractors in
our Service Transport subsidiary.
Use of Non-GAAP Financial Measures
This press release and accompanying schedules includes the non-GAAP
financial measures of adjusted cash flow, adjusted net (losses)
earnings and adjusted (losses) earnings per common share. The
accompanying schedules provide definitions of these non-GAAP
financial measures and reconciliations to their most directly
comparable financial measures calculated and presented in
accordance with GAAP. Company management uses these
measurements as aids in monitoring the Company's ongoing financial
performance from quarter to quarter and year to year on a regular
basis and for benchmarking against peer companies. Our
non-GAAP financial measures should not be considered as
alternatives to GAAP measures such as net income, operating income,
net cash flow provided by operating activities or any other measure
of financial performance calculated and presented in accordance
with GAAP. Our non-GAAP financial measures may not be
comparable to similarly-titled measures of other companies because
they may not calculate such measures in the same manner as we
do.
Adams Resources & Energy, Inc. is primarily engaged
in the business of crude oil marketing, transportation and storage,
tank truck transportation of liquid chemicals and dry bulk through
its two subsidiaries, GulfMark Energy, Inc. and Service Transport
Company, respectively. For more information, visit
www.adamsresources.com.
Cautionary Statement Regarding Forward-Looking
Statements
This news release contains forward-looking statements.
Forward-looking statements relate to future events and anticipated
results of operations, business strategies, and other aspects of
our operations or operating results. In many cases you can identify
forward-looking statements by terminology such as "anticipate,"
"intend," "plan," "project," "estimate," "continue," "potential,"
"should," "could," "may," "will," "objective," "guidance,"
"outlook," "effort," "expect," "believe," "predict," "budget,"
"projection," "goal," "forecast," "target" or similar words.
Statements may be forward looking even in the absence of these
particular words. Where, in any forward-looking statement, the
Company expresses an expectation or belief as to future results,
such expectation or belief is expressed in good faith and believed
to have a reasonable basis. However, there can be no assurance that
such expectation or belief will result or be achieved. Unless
legally required, Adams undertakes no obligation to update publicly
any forward-looking statements, whether as a result of new
information, future events or otherwise.
Contact: Tracy E.
Ohmart
EVP, Chief Financial Officer
tohmart@adamsresources.com
(713) 881-3609
ADAMS RESOURCES
& ENERGY, INC. AND SUBSIDIARIES
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands,
except per share data)
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2019
|
|
2018
|
Revenues:
|
|
|
|
Marketing
|
$
|
429,761
|
|
$
|
373,638
|
Transportation
|
15,407
|
|
13,618
|
Total
revenues
|
445,168
|
|
387,256
|
|
|
|
|
Costs and
expenses:
|
|
|
|
Marketing
|
420,541
|
|
369,183
|
Transportation
|
13,101
|
|
12,301
|
General and
administrative
|
2,684
|
|
2,283
|
Depreciation and
amortization
|
3,589
|
|
2,412
|
Total costs and
expenses
|
439,915
|
|
386,179
|
|
|
|
|
Operating
earnings
|
5,253
|
|
1,077
|
|
|
|
|
Other income
(expense):
|
|
|
|
Gain on dissolution of
investment
|
498
|
|
—
|
Interest
income
|
656
|
|
387
|
Interest
expense
|
(65)
|
|
(19)
|
Total other income
(expense), net
|
1,089
|
|
368
|
|
|
|
|
Earnings before
income taxes
|
6,342
|
|
1,445
|
Income tax
provision
|
(1,434)
|
|
(307)
|
|
|
|
|
Net
earnings
|
$
|
4,908
|
|
$
|
1,138
|
|
|
|
|
Earnings per
share:
|
|
|
|
Basic net earnings per
common share
|
$
|
1.16
|
|
$
|
0.27
|
Diluted net earnings
per common share
|
$
|
1.16
|
|
$
|
0.27
|
|
|
|
|
Dividends per
common share
|
$
|
0.22
|
|
$
|
0.22
|
ADAMS RESOURCES
& ENERGY, INC. AND SUBSIDIARIES
|
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(In thousands,
except share data)
|
|
|
March
31,
|
|
December
31,
|
|
2019
|
|
2018
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
130,893
|
|
$
|
117,066
|
Accounts receivable,
net of allowance for doubtful accounts
|
88,095
|
|
85,197
|
Accounts receivable –
related party
|
—
|
|
425
|
Inventory
|
29,237
|
|
22,779
|
Derivative
assets
|
274
|
|
162
|
Income tax
receivable
|
1,978
|
|
2,404
|
Prepayments and other
current assets
|
1,609
|
|
1,557
|
Total current
assets
|
252,086
|
|
229,590
|
|
|
|
|
Property and
equipment, net
|
48,917
|
|
44,623
|
Operating lease
right-of-use assets
|
10,681
|
|
—
|
Cash deposits and
other assets
|
2,951
|
|
4,657
|
Total
assets
|
$
|
314,635
|
|
$
|
278,870
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
133,325
|
|
$
|
116,068
|
Accounts payable –
related party
|
6
|
|
29
|
Derivative
liabilities
|
270
|
|
139
|
Current portion of
finance lease obligations
|
1,002
|
|
883
|
Current portion of
operating lease liabilities
|
2,160
|
|
—
|
Other current
liabilities
|
8,580
|
|
6,148
|
Total current
liabilities
|
145,343
|
|
123,267
|
Other long-term
liabilities:
|
|
|
|
Asset retirement
obligations
|
1,538
|
|
1,525
|
Finance lease
obligations
|
3,428
|
|
3,209
|
Operating lease
liabilities
|
8,523
|
|
—
|
Deferred taxes and
other liabilities
|
5,104
|
|
4,271
|
Total
liabilities
|
163,936
|
|
132,272
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
Shareholders'
equity
|
150,699
|
|
146,598
|
Total liabilities and
shareholders' equity
|
$
|
314,635
|
|
$
|
278,870
|
ADAMS RESOURCES
& ENERGY, INC. AND SUBSIDIARIES
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In
thousands)
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2019
|
|
2018
|
Operating
activities:
|
|
|
|
Net
earnings
|
$
|
4,908
|
|
$
|
1,138
|
Adjustments to
reconcile net earnings to net cash
|
|
|
|
provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
3,589
|
|
2,412
|
Gains on sales of
property
|
(178)
|
|
(26)
|
Provision for doubtful
accounts
|
(32)
|
|
—
|
Stock-based
compensation expense
|
123
|
|
—
|
Deferred income
taxes
|
834
|
|
(709)
|
Net change in fair
value contracts
|
19
|
|
(2)
|
Gain on dissolution of
AREC
|
(498)
|
|
—
|
Changes in assets
and liabilities:
|
|
|
|
Accounts
receivable
|
(2,866)
|
|
4,200
|
Accounts
receivable/payable, affiliates
|
(23)
|
|
—
|
Inventories
|
(6,458)
|
|
(7,075)
|
Income tax
receivable
|
426
|
|
880
|
Prepayments and other
current assets
|
(52)
|
|
153
|
Accounts
payable
|
17,914
|
|
1,377
|
Accrued
liabilities
|
2,432
|
|
851
|
Other
|
878
|
|
86
|
Net cash provided by
operating activities
|
21,016
|
|
3,285
|
|
|
|
|
Investing
activities:
|
|
|
|
Property and equipment
additions
|
(8,351)
|
|
(866)
|
Proceeds from property
sales
|
543
|
|
132
|
Proceeds from
dissolution of AREC
|
923
|
|
—
|
Insurance and state
collateral refunds
|
842
|
|
603
|
Net cash used in
investing activities
|
(6,043)
|
|
(131)
|
|
|
|
|
Financing
activities:
|
|
|
|
Principal repayments
of finance lease obligations
|
(218)
|
|
(83)
|
Dividends paid on
common stock
|
(928)
|
|
(928)
|
Net cash used in
financing activities
|
(1,146)
|
|
(1,011)
|
|
|
|
|
Increase in cash
and cash equivalents
|
13,827
|
|
2,143
|
Cash and cash
equivalents at beginning of period
|
117,066
|
|
109,393
|
Cash and cash
equivalents at end of period
|
$
|
130,893
|
|
$
|
111,536
|
ADAMS RESOURCES
& ENERGY, INC. AND SUBSIDIARIES
|
NON-GAAP
RECONCILIATIONS
|
(In thousands,
except per share data)
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2019
|
|
2018
|
Reconciliation of
Adjusted Cash Flow to Net Earnings:
|
|
|
|
Net earnings
|
$
|
4,908
|
|
$
|
1,138
|
Add
(subtract):
|
|
|
|
Income tax
provision
|
1,434
|
|
307
|
Depreciation and
amortization
|
3,589
|
|
2,412
|
Gains on sales of
property
|
(178)
|
|
(26)
|
Gain on dissolution of
AREC
|
(498)
|
|
—
|
Stock-based
compensation expense
|
123
|
|
—
|
Inventory liquidation
gains
|
(4,462)
|
|
(552)
|
Net change in fair
value contracts
|
19
|
|
(2)
|
Adjusted cash
flow
|
$
|
4,935
|
|
$
|
3,277
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2019
|
|
2018
|
Adjusted net
earnings and earnings per common share (Non-GAAP):
|
|
|
|
Net earnings
|
$
|
4,908
|
|
$
|
1,138
|
Add
(subtract):
|
|
|
|
Gain on dissolution of
AREC
|
(498)
|
|
—
|
Gains on sales of
property
|
(178)
|
|
(26)
|
Stock-based
compensation expense
|
123
|
|
—
|
Net change in fair
value of contracts
|
19
|
|
(2)
|
Inventory liquidation
gains
|
(4,462)
|
|
(552)
|
Tax effect of
adjustments to earnings
|
1,049
|
|
122
|
Adjusted net
earnings
|
$
|
961
|
|
$
|
680
|
|
|
|
|
Adjusted earnings per
common share
|
$
|
0.23
|
|
$
|
0.16
|
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SOURCE Adams Resources & Energy, Inc.