Adams Resources & Energy, Inc. Announces Fourth Quarter 2017 Results
Adams Resources & Energy, Inc. Announces Fourth Quarter 2017 Results
HOUSTON, March 12, 2018 /PRNewswire/ -- Adams Resources & Energy, Inc. (NYSE MKT: AE) ("Adams" or the "Company") today announced its financial results for the three months and year ended December 31, 2017.
The Company reported net earnings of $3.7 million, or $0.88 per common share, on revenues of $408.5 million for the fourth quarter of 2017, compared to a net loss of $0.2 million, or ($0.04) per common share, on revenues of $299.0 million for the fourth quarter of 2016. On an adjusted basis, net earnings were $1.3 million, or $0.31 per common share, for the fourth quarter of 2017, compared to a net loss of $1.6 million, or ($0.38) per common share, for the fourth quarter of 2016. For the full year 2017, the Company had a net loss of $0.5 million, or ($0.11) per common share, on revenues of $1.3 billion, compared to net earnings of $2.5 million, or $0.60 per common share, on revenues of $1.1 billion for the full year 2016. On an adjusted basis, net earnings were $1.3 million, or $0.31 per common share for the full year 2017, compared to a net loss of $3.0 million, or ($0.70) per common share for the full year 2016.
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.
Fourth Quarter 2017 Highlights:
-- Gross revenues of approximately $408.5 million for the fourth quarter of
2017 compared to $299.0 million for the fourth quarter of 2016, and
gross revenues of approximately $1.3 billion for the full year 2017
compared to $1.1 billion for the full year 2016
-- Our crude oil marketing subsidiary, GulfMark Energy, Inc., marketed
approximately 72,387 barrels per day ("bpd") of crude oil during the
fourth quarter of 2017, compared to 66,469 bpd of crude oil during the
fourth quarter of 2016
-- Cash and cash equivalents increased 25 percent from December 31, 2016
levels of $87 million to over $109 million at December 31, 2017
-- $167 million of liquidity ($109.4 million of cash and cash equivalents
and $57.8 million of undrawn letter of credit facility) at December 31,
2017
-- Generated positive adjusted cash flow of $3.2 million for the fourth
quarter of 2017 compared to positive adjusted cash flow of $2.3 million
for the fourth quarter of 2016
-- Approximately 198,011 barrels of crude oil inventory at December 31,
2017
-- Dividend of $0.22 per share for the fourth quarter of 2017
-- No short or long term debt at December 31, 2017
"During the fourth quarter of 2017, we generated positive financial and operating results from our marketing segment as our average daily barrels marketed and transported increased approximately nine percent from levels in the fourth quarter of 2016 to 72,387 barrels per day," said Townes Pressler, Executive Chairman. "Volumes increased as our customers' completion crews converted drilled but uncompleted wells to production primarily in the Gulf Coast region. Service Transport began to gain positive momentum as our revenue per mile increased 15 percent from the fourth quarter of 2016 to the fourth quarter of 2017. As demand remains robust, we are making good progress in improving trucking rates with our customers at Service Transport. During 2018, we plan to remain focused on enhancing margins, with disciplined investing and upgrading our fleet of tractors with the latest technologically advanced safety equipment, as well as actively pursuing development opportunities that complement our two primary business segments," continued Pressler.
Capital Investments and Dividends
During the fourth quarter of 2017, the Company recorded approximately $0.2 million of capital spending and paid dividends of $0.9 million ($0.22 per share). For the full year 2017, the Company recorded approximately $4.5 million of capital and paid dividends of $3.7 million ($0.88 per share). Of the $4.5 million of capital recorded during 2017, $1.8 million was associated with capital leases of tractors for our marketing segment and $1.8 million was associated with drilling and completions activity associated with our upstream subsidiary. The Company exited the upstream business through a chapter 11 bankruptcy sale process in which substantially all of the assets were sold during 2017. The upstream subsidiary obtained a confirmed plan from the Delaware bankruptcy court in December 2017.
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 engaged in the business of crude oil marketing, transportation and storage, tank truck transportation of liquid chemicals and dry bulk and ISO tank container storage and transportation. 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: Josh C. Anders
EVP, Chief Financial Officer
janders@adamsresources.com
(281) 974-9442
ADAMS RESOURCES & ENERGY, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Ended Year Ended
December 31, December 31,
2017 2016 2017 2016
---- ---- ---- ----
Revenues:
Marketing $395,255 $285,148 $1,267,275 $1,043,775
Transportation 13,205 12,838 53,358 52,355
Oil and natural gas - 983 1,427 3,410
--- --- ----- -----
Total revenues 408,460 298,969 1,322,060 1,099,540
------- ------- --------- ---------
Costs and expenses:
Marketing 387,196 278,875 1,247,763 1,016,733
Transportation 11,857 11,617 48,538 45,154
Oil and natural gas - (337) 948 2,084
Oil and natural gas
property impairments - 313 3 313
General and
administrative 2,823 4,158 9,707 10,410
Depreciation, depletion
and amortization 2,827 4,407 13,599 18,792
----- ----- ------ ------
Total costs and expenses 404,703 299,033 1,320,558 1,093,486
------- ------- --------- ---------
Operating earnings
(losses) 3,757 (64) 1,502 6,054
----- --- ----- -----
Other income (expense):
Loss on deconsolidation
of subsidiary - - (3,505) -
Impairment of investment
in unconsolidated
affiliate - - (2,500) -
Interest income 314 138 1,103 582
Interest expense (17) (2) (27) (2)
--- --- --- ---
Total other income
(expense), net 297 136 (4,929) 580
--- --- ------ ---
(Losses) earnings before
income taxes and
investment in
unconsolidated affiliate 4,054 72 (3,427) 6,634
----- --- ------ -----
Income tax benefit
(provision) (361) (240) 2,945 (2,691)
---- ---- ----- ------
Earnings (losses) from
continuing operations 3,693 (168) (482) 3,943
Losses from investment in
unconsolidated
affiliate, net of tax
benefit - - - (1,430)
--- --- --- ------
Net (losses) earnings $3,693 $(168) $(482) $2,513
====== ===== ===== ======
Earnings (losses) per share:
From continuing
operations $0.88 $(0.04) $(0.11) $0.94
From investment in
unconsolidated affiliate - - - (0.34)
--- --- --- -----
Basic and diluted net
(losses) earnings per
common share $0.88 $(0.04) $(0.11) $0.60
===== ====== ====== =====
Weighted average number of common
shares outstanding
4,218 4,218 4,218 4,218
===== ===== ===== =====
Dividends per common
share $0.22 $0.22 $0.88 $0.88
===== ===== ===== =====
ADAMS RESOURCES & ENERGY, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
December 31,
2017 2016
---- ----
ASSETS
Current assets:
Cash and cash
equivalents $109,393 $87,342
Accounts receivable,
net of allowance for
doubtful accounts 121,353 87,162
Inventory 12,192 13,070
Derivative assets 166 112
Income tax receivable 1,317 2,735
Prepayments and other
current assets 1,264 2,097
----- -----
Total current assets 245,685 192,518
------- -------
Property and
equipment, net 29,362 46,325
Investments in
unconsolidated
affiliates 425 2,500
Cash deposits and
other 7,232 5,529
----- -----
Total assets $282,704 $246,872
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $124,706 $79,897
Accounts payable -
related party 5 53
Derivative liabilities 145 64
Current portion of
capital lease
obligations 338 -
Other current
liabilities 4,404 6,060
----- -----
Total current
liabilities 129,598 86,074
------- ------
Other long-term liabilities:
Asset retirement
obligations 1,273 2,329
Capital lease
obligations 1,351 -
Deferred taxes and
other liabilities 3,363 7,157
----- -----
Total liabilities 135,585 95,560
------- ------
Commitments and contingencies
Shareholders' equity 147,119 151,312
------- -------
Total liabilities and
shareholders' equity $282,704 $246,872
======== ========
ADAMS RESOURCES & ENERGY, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Year Ended
December 31,
2017 2016
---- ----
Operating activities:
Net (losses) earnings $(482) $2,513
Adjustments to reconcile net (losses) earnings to net
cash
provided by operating activities:
Depreciation, depletion and
amortization 13,599 18,792
Gains on sale of property (594) (1,966)
Impairment of oil and natural gas
properties 3 313
Provision for doubtful accounts 78 19
Deferred income taxes (3,840) (857)
Net change in fair value contracts 27 (243)
Losses from equity investment - 468
Impairment of investments in
unconsolidated affiliates 2,500 1,732
Loss on deconsolidation of
subsidiary 3,505 -
Changes in assets and liabilities:
Accounts receivable (34,935) (15,368)
Accounts receivable/payable,
affiliates 271 -
Inventories 878 (5,399)
Income tax receivable 1,418 (148)
Prepayments and other current
assets 831 492
Accounts payable 44,790 6,984
Accrued liabilities (991) 52
Other (962) (440)
---- ----
Net cash provided by operating
activities 26,096 6,944
------ -----
Investing activities:
Property and equipment additions (2,644) (8,484)
Proceeds from property sales 720 3,706
Proceeds from sales of AREC assets 2,775 -
Investments in unconsolidated
affiliates - (4,700)
Insurance and state collateral
(deposits) refunds (1,067) 1,710
------ -----
Net cash used in investing
activities (216) (7,768)
---- ------
Financing activities:
Principal repayments of capital
lease obligations (118) -
Dividends paid on common stock (3,711) (3,711)
------ ------
Net cash used in financing
activities (3,829) (3,711)
------ ------
Increase (decrease) in cash and
cash equivalents 22,051 (4,535)
Cash and cash equivalents at
beginning of period 87,342 91,877
------ ------
Cash and cash equivalents at end of
period $109,393 $87,342
======== =======
ADAMS RESOURCES & ENERGY, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATIONS
(In thousands, except per share data
Three Months Ended Year Ended
December 31, December 31,
2017 2016 2017 2016
---- ---- ---- ----
Reconciliation of Adjusted Cash Flow to Net (Losses) Earnings:
Net (losses) earnings $3,693 $(168) $(482) $2,513
Income tax benefit
(provision) 361 240 (2,945) 1,921
Depreciation, depletion
and amortization 2,827 4,407 13,599 18,792
Gains on sale of property (247) (18) (594) (1,966)
Impairment of oil and
natural gas properties - 226 3 313
Loss on deconsolidation
of subsidiary - - 3,505 -
Impairment of investments
in unconsolidated
affiliates - - 2,500 1,732
Inventory liquidation
gains (3,481) (2,464) (3,372) (8,243)
Net change in fair value
contracts (21) 62 27 (243)
Voluntary early
retirement program costs - - 1,435 -
Legal and other accrual
reversals - - (840) -
Insurance deductible
related to hurricane 100 - 100 -
--- --- --- ---
Adjusted cash flow $3,232 $2,285 $12,936 $14,819
====== ====== ======= =======
Three Months Ended Year Ended
December 31, December 31,
2017 2016 2017 2016
---- ---- ---- ----
Adjusted net (losses) earnings and
(losses) earnings per common share
(Non-GAAP):
Net (losses) earnings $3,693 $(168) $(482) $2,513
Add (subtract):
Loss on deconsolidation
of subsidiary - - 3,505 -
Impairment of investments
in unconsolidated
affiliates - - 2,500 1,732
Gains on sale of property (247) (18) (594) (1,966)
Impairment of oil and
natural gas properties - 226 3 313
Voluntary early
retirement program costs - - 1,435 -
Net change in fair value
contracts (21) 62 27 (243)
Inventory liquidation
gains (3,481) (2,464) (3,372) (8,243)
Legal and other accrual
reversals - - (840) -
Insurance deductible
related to hurricane 100 - 100 -
Tax effect of adjustments
to (losses) earnings 1,277 768 (967) 2,942
----- --- ---- -----
Adjusted net (losses)
earnings $1,321 $(1,594) $1,315 $(2,952)
====== ======= ====== =======
Adjusted (losses)
earnings per common
share $0.31 $(0.38) $0.31 $(0.70)
===== ====== ===== ======
View original content with multimedia:http://www.prnewswire.com/news-releases/adams-resources--energy-inc-announces-fourth-quarter-2017-results-300612529.html
SOURCE Adams Resources & Energy, Inc.
