HGH Adv

Vertex Energy, Inc. Announces Fourth Quarter and Full-Year 2018 Financial Results

2 months ago DieselGasoil Comments Off on Vertex Energy, Inc. Announces Fourth Quarter and Full-Year 2018 Financial Results

Vertex Energy, Inc. Announces Fourth Quarter and Full-Year 2018 Financial Results

HOUSTON, March 06, 2019 (GLOBE NEWSWIRE) — Vertex Energy, Inc. (NASDAQ:VTNR), a specialty refiner and marketer of high-quality hydrocarbon products, announced today its 2018 financial results for the fourth quarter and twelve months ended December 31, 2018.

FINANCIAL HIGHLIGHTS FOR FOURTH QUARTER 2018

  • Consolidated revenues increased 1% to $41.8 million, compared to $41.3 for the fourth quarter 2017
  • Gross profit was down 38% to $4.9 million compared to $7.9 million in the fourth quarter 2017
  • Total overall volume declined 24% versus the fourth quarter 2017
  • Net loss attributable to Vertex Energy was $201,333 in the fourth quarter of 2018, versus $385,387 for the fourth quarter of 2017

FINANCIAL HIGHLIGHTS FOR YEAR ENDED DECEMBER 31, 2018

  • Consolidated revenues increased to $180.7 million, compared to $145.5 million for the year ended December 31, 2017
  • Gross profit increased 38% to $29.4 million compared to $21.3 million in 2017
  • Gross profit margin was 16%, versus 15% for 2017
  • Net loss available to common shareholders was $8.0 million, or $0.23 per share, a reduction compared to a loss of $11.8 million or $0.36 per share in 2017
  • The company collected approximately 30 million gallons of used oil feedstock in 2018, compared to 26 million gallons for the same period of 2017

Benjamin P. Cowart, Chairman and CEO of Vertex Energy, Inc., stated, “During 2018, the market in each of our benchmark commodities was relatively stable, until they hit their lows in the fourth quarter, which caused a sharp decline in pricing. However, our nimble operations enabled us to quickly shift our service model and implement new pricing, allowing our margins to begin to recover in the first quarter 2019.

Additionally, we are very pleased with the 4th quarter performance of our marine fuel business even though throughout the 4th quarter of 2018 we suffered margin compression in our base oil, Refining and marketing and our recovery divisions. Recently we have seen pricing and spreads reset going into the new year and we anticipate 2019 financial results to  improve over 2018.”

FOURTH QUARTER AND FULL-YEAR 2018 FINANCIAL RESULTS CONFERENCE CALL DETAILS

Management will host a conference call on March 6, 2019 at 9 A.M. EST.

Those who wish to participate in the conference call may telephone 1-877-869-3847 from the U.S. and International callers may telephone 1-201-689-8261, approximately 15 minutes before the call. A webcast will also be available under the Investor Relations section at www.vertexenergy.com.

A digital replay will be available by telephone approximately two hours after the completion of the call until May 31, 2019 and may be accessed by dialing 1-877-660-6853 from the U.S. or 1-201-612-7415 for international callers, using conference ID #13688151.

ABOUT VERTEX ENERGY, INC.

Vertex Energy, Inc. (NASDAQ: VTNR) is a specialty refiner of alternative feedstocks and marketer of high-purity petroleum products. With its headquarters in Houston, Texas, Vertex is one of the largest processors of used motor oil in the U.S. and has processing capacity of over 115 million gallons annually with operations located in Houston and Port Arthur (TX), Marrero (LA), and Columbus (OH). Vertex also has a facility, Myrtle Grove, located on a 41 acre industrial complex along the Gulf Coast in Belle Chasse, LA, with existing hydroprocessing and plant infrastructure assets, that include nine million gallons of storage. Vertex has implemented a cost-effective strategy for building its feedstock supply by establishing a successful self-collection and aggregation system. The company has built a reputation as a key supplier of Group II+ and Group III base oils to the lubricant manufacturing industry in North America. For more information on Vertex Energy please contact Porter, LeVay & Rose, Inc.’s investor relations representative Michael Porter at 212-564-4700 or visit our website at www.vertexenergy.com.

Forward-Looking Statements

This press release may contain forward-looking statements, including information about management’s view of Vertex Energy’s future expectations, plans and prospects, within the safe harbor provisions under The Private Securities Litigation Reform Act of 1995 (the “Act”). In particular, when used in the preceding discussion, the words “believes,” “hopes,” “expects,” “intends,” “plans,” “anticipates,” or “may,” and similar conditional expressions are intended to identify forward-looking statements within the meaning of the Act, and are subject to the safe harbor created by the Act. Any statements made in this news release other than those of historical fact, about an action, event or development, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors, which may cause the results of Vertex Energy, its divisions and concepts to be materially different than those expressed or implied in such statements. These risk factors and others are included from time to time in documents Vertex Energy files with the Securities and Exchange Commission, including but not limited to, its Form 10-Ks, Form 10-Qs and Form 8-Ks. Other unknown or unpredictable factors also could have material adverse effects on Vertex Energy’s future results. The forward-looking statements included in this press release are made only as of the date hereof. Vertex Energy cannot guarantee future results, levels of activity, performance or achievements. Accordingly, you should not place undue reliance on these forward-looking statements. Finally, Vertex Energy undertakes no obligation to update these statements after the date of this release, except as required by law, and also takes no obligation to update or correct information prepared by third parties that are not paid for by Vertex Energy.

 Reconciliation of Net Income (Loss) attributable to Vertex Energy, Inc., to Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA* 
 
 For the Three Months EndedFor the Twelve Months Ended 
  December 31,
2018
   December 31,
2017
   December 31,
2018
   December 31,
2017
 
Net (loss) income
attributable to Vertex Energy, Inc.
$(201,333) $(385,387) $(2,217,767) $(8,433,233)
Add (deduct):               
Interest Income       (659)  (5,748)
Interest Expense 833,084   794,668   3,281,855   3,483,062 
Depreciation and amortization 1,756,996   1,700,413   6,991,010   6,643,324 
Tax benefit    (274,423)     (274,423)
                
EBITDA* 2,388,747   1,835,271   8,054,439   1,412,982 
                
Add (deduct):                
Gain (loss) on change in value of derivative warrant liability (2,888,687)  556,318   (763,716)  (2,120,584)
Add (deduct): Stock-Based compensation  165,057    145,971    659,836    606,446 
                
Adjusted EBITDA $ (334,883)  $ 2,537,560   $ 7,950,559   $ (101,156
                

* EBITDA and adjusted EBITDA are non-GAAP financial measures. These measurements are not recognized in accordance with GAAP and should not be viewed as an alternative to GAAP measures of performance.

EBITDA represents net income before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA before stock-based compensation expense and gain (loss) on change in value of derivative warrant liability. EBITDA and adjusted EBITDA are presented because we believe they provide additional useful information to investors due to the various noncash items during the period. EBITDA and adjusted EBITDA 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 GAAP. Some of these limitations are:

  • EBITDA and adjusted EBITDA do not reflect cash expenditures, or future requirements for capital expenditures, or contractual commitments;
  • EBITDA and adjusted EBITDA do not reflect changes in, or cash requirements for, working capital needs;
  • EBITDA and adjusted EBITDA 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, and EBITDA and adjusted EBITDA do not reflect any cash requirements for such replacements; and
  • Other companies in this industry may calculate EBITDA and adjusted EBITDA differently than Vertex Energy does, limiting its usefulness as a comparative measure.
VERTEX ENERGY, INC.
CONSOLIDATED BALANCE SHEETS
UNAUDITED
 December 31, 2018 December 31, 2017
ASSETS   
Current assets   
Cash and cash equivalents$1,349,831  $1,105,787 
Restricted cash1,500,000   
Accounts receivable, net9,027,990  11,288,991 
Federal income tax receivable137,212   
Inventory8,091,397  6,304,842 
Derivative commodity asset695,941   
Prepaid expenses2,740,541  1,771,832 
Total current assets23,542,912  20,471,452 
    
    
Fixed assets, at cost67,212,486  65,237,652 
Less accumulated depreciation(19,927,479) (16,617,824)
Fixed assets, net47,285,007  48,619,828 
Goodwill and other intangible assets, net12,578,519  14,499,354 
Deferred tax asset137,211  274,423 
Other assets616,759  440,417 
TOTAL ASSETS$84,160,408  $84,305,474 
    
LIABILITIES, TEMPORARY EQUITY AND EQUITY   
Current liabilities   
Accounts payable$8,791,529  $7,826,016 
Accrued expenses2,535,347  2,492,722 
Dividends payable403,002  420,713 
Capital leases-current95,857   
Current portion of long-term debt, net of unamortized finance costs1,325,240  1,616,926 
Revolving note3,844,636  4,591,527 
Total current liabilities16,995,611  16,947,904 
    
Long-term debt, net of unamortized finance costs14,402,179  13,531,179 
Capital leases-long-term276,355   
Contingent consideration15,564  236,680 
Derivative warrant liability1,481,692  2,245,408 
Total liabilities33,171,401  32,961,171 
    
COMMITMENTS AND CONTINGENCIES (Note 4)   
    
TEMPORARY EQUITY   
Series B Preferred Stock, $0.001 par value per share;
10,000,000 shares authorized, 3,604,827 and 3,427,597 shares issued
and outstanding at December 31, 2018 and 2017, respectively with liquidation preference of $11,174,964 and $10,625,551 at December 31, 2018 and 2017, respectively.
8,900,208  7,190,467 
    
Series B1 Preferred Stock, $0.001 par value per share;
17,000,000 shares authorized, 10,057,597 and 13,151,989 shares issued
and outstanding at December 31, 2018 and 2017, respectively with liquidation preference of $15,689,851 and $20,517,103 at December 31, 2018 and 2017, respectively.
13,279,755  15,769,478 
Total Temporary Equity22,179,963  22,959,945 
    
VERTEX ENERGY, INC
CONSOLIDATED BALANCE SHEETS
UNAUDITED
    
 December 31, 2018 December 31, 2017
EQUITY   
Series A Convertible Preferred stock, $0.001 par value;
5,000,000 shares authorized and 419,859 and 453,567 shares issued
and outstanding at December 31, 2018 and 2017, respectively, with a liquidation preference of $625,590 and $675,815 at December 31, 2018 and December 31, 2017, respectively.
420  454 
    
Series C Convertible Preferred stock, $0.001 par value per share;
44,000 shares designated in 2016; zero and 31,568
issued and outstanding at December 31, 2018 and 2017, respectively with a liquidation preference of $0 and $3,156,800 at December 31, 2018 and December 31, 2017, respectively.
  32 
    
Common stock, $0.001 par value per share;
750,000,000 shares authorized; 40,174,821 and 32,658,176
issued and outstanding at December 31, 2018 and 2017, respectively.
40,175  32,658 
Additional paid-in capital75,131,122  67,768,509 
Accumulated deficit(47,800,886) (39,816,300
  Total Vertex Energy, Inc. stockholders’ equity27,370,831  27,985,353 
Non-controlling interest1,438,213  399,005 
  Total Equity28,809,044  28,384,358 
TOTAL LIABILITIES, TEMPORARY EQUITY AND EQUITY$84,160,408  $84,305,474 
VERTEX ENERGY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 2018 and 2017
UNAUDITED
 2018 2017
Revenues$180,720,661  $145,499,092 
Cost of revenues (exclusive of depreciation and amortization shown separately below)151,314,039  124,226,489 
Gross profit29,406,622  21,272,603 
    
Operating expenses:   
Selling, general and administrative expenses21,927,264  21,685,542 
Depreciation and amortization6,991,010  6,643,324 
Total operating expenses28,918,274  28,328,866 
Income (loss) from operations488,348  (7,056,263)
Other income (expense):   
Other income659  5,748 
Gain on sale of assets45,553  445 
Gain on change in value of derivative warrant liability763,716  2,120,584 
Interest expense(3,281,855) (3,483,062)
Total expense(2,471,927) (1,356,285)
Loss before income taxes(1,983,579) (8,412,548)
Income tax benefit  274,423 
Net loss(1,983,579) (8,138,125)
Net income attributable to non-controlling interest234,188  295,108 
Net loss attributable to Vertex Energy, Inc.(2,217,767) (8,433,233)
    
Accretion of discount on series B and B-1 Preferred Stock(3,132,414) (1,713,736)
Dividends on series B and B-1 Preferred Stock(2,687,123) (1,677,633)
Net loss available to common stockholders$(8,037,304) $(11,824,602)
    
Income (loss) per common share   
Basic$(0.23) $(0.36)
Diluted$(0.23) $(0.36)
Shares used in computing earnings per share   
Basic35,411,264  32,653,402 
Diluted35,411,264  32,653,402 
VERTEX ENERGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDING DECEMBER 31, 2018 AND 2017
UNAUDITED
 2018 2017
Cash flows from operating activities   
Net loss$(1,983,579) $(8,138,125)
Adjustments to reconcile net loss to cash used in operating activities:   
Stock-based compensation expense659,836  606,446 
Depreciation and amortization6,991,010  6,643,324 
Bad debt recovery(299,110)  
Gain on commodity derivative contracts(1,062,682)  
Net cash settlement on commodity derivatives369,188   
Gain on sale of assets(45,553) (445
Gain on disposition(241,416)  
Amortization of debt discount and deferred costs584,336  715,112 
Deferred federal income tax  (274,423)
Decrease in fair value of derivative liability(763,716) (2,120,584)
Reduction in contingent consideration(128,116)  
Impairment of goodwill176,349   
Changes in operating assets and liabilities:   
Accounts receivable2,143,834  (336,772)
Inventory(1,786,555) (1,910,884)
Prepaid expenses(597,146) 897,285 
Accounts payable1,493,324  487,343 
Accrued expenses42,625  390,699 
Other assets(176,342) 77,833 
Net cash provided by (used in) operating activities5,376,287  (2,963,191
Cash flows from investing activities   
Acquisitions(269,826) (1,999,580)
Proceeds from the sale of assets  327,718 
Purchase of fixed assets(2,499,117) (2,125,667)
Net cash used in investing activities(2,768,943) (3,797,529
Cash flows from financing activities   
Line of credit proceeds (payments), net(746,891) 1,865,488 
Payments on capital lease obligations(77,886)  
Payment of debt issuance costs  (1,718,090)
Proceeds from notes payable4,024,964  17,570,929
Payments made on notes payable(4,063,487) (13,057,978
Net cash used in (provided by) financing activities(863,300) 4,660,349 
Net change in cash and cash equivalents and restricted cash1,744,044  (2,100,371
Cash and cash equivalents and restricted cash at beginning of the year1,105,787  3,206,158 
Cash and cash equivalents and restricted cash at end of year$2,849,831  $1,105,787 
    
SUPPLEMENTAL INFORMATION   
Cash paid for interest$2,722,542  $1,952,719 
Cash paid for income taxes$  $ 
    
NON-CASH INVESTING AND FINANCING TRANSACTIONS   
Conversion of Series A Preferred Stock into common stock$34  $39 
Conversion of Series B and B1 Preferred Stock into common stock$6,613,052  $119,440 
Dividends on Series B and B-1 Preferred Stock$2,687,123  $1,677,633 
Accretion of discount on Series B and B-1 Preferred Stock$3,132,414  $1,713,736 
Equipment acquired under capital leases$450,098  $ 
Contributed assets Vertex Recovery Management LA from non-controlling interest$857,738  $ 
Contingent consideration on Nickco acquisition$  $236,680 
Common restricted shares for Nickco acquisition$93,000  $474,000 
Return of common shares for sale escrow$  $1,109 

Investor Relations Contact:
Michael Porter
President
Porter, LeVay & Rose
212-564-4700

HGH Adv

Related Posts

World’s 1st remote brain surgery via 5G network performed in China

DieselGasoil 1 month ago
A Chinese surgeon has performed the world’s first remote brain surgery using 5G technology, with the patient 3,000km away from the operating doctor. Dr. Ling Zhipei remotely implanted a... Read More

Russian FM slams Washington for sabotaging talks on space disarmament

DieselGasoil 3 weeks ago
Washington has blocked the final report on the prevention of an arms race in space without any reasonable explanation, the Russian Foreign Ministry said as a UN Group of... Read More

US & Europe react to Poroshenko’s defeat by comedian Zelensky in Ukraine

DieselGasoil 3 days ago
As early results show West-backed President Petro Poroshenko looks certain to be defeated by comic Volodymyr Zelensky, US and EU officials have queued up to congratulate the political rookie,... Read More

R Kelly asks judge for permission to perform gigs in Dubai

DieselGasoil 1 month ago
R Kelly has asked a judge for permission to travel to Dubai so he can perform shows and “meet with the royal family”. The cash-strapped singer’s request comes as... Read More