Vertex Energy Inc. - FORM 8-K - EX-99.1 - November 5, 2013

Attached files

file filename
8-K - Vertex Energy Inc.vertex8k110513.htm
EXHIBIT 99.1

 
Vertex Energy Reports a 53% Increase in Gross Profit for Third Quarter 2013 Compared to Third Quarter 2012
 
29% Revenue Increase for the Quarter
 
—Conference Call Today at 10:00 A.M. EST—
 
HOUSTON--(BUSINESS WIRE)--Vertex Energy, Inc. (NASDAQ:VTNR), an environmental services company that recycles industrial waste streams and off-specification commercial chemical products, today announced its financial results for the quarter and nine months ended September 30, 2013.
 
Financial highlights for the quarter include:
 
·  
Gross profit increased by approximately 53% relative to the same quarter last year to $4.88 million;
 
 
·  
Revenue increased by 29% relative to the third quarter of last year to $46.8 million;
 
 
·  
Overall volumes of product sold increased by 19% for the third quarter of 2013 versus the third quarter of 2012;
 
 
·  
Our overall per barrel margin increased by 29% relative to the same quarter a year ago;
 
 
·  
Income before income taxes improved by 486% for the quarter; and
 
 
·  
Net income improved by 11% relative to the third quarter of last year to $2.33 million.  
 
Benjamin P. Cowart, Chief Executive Officer of Vertex Energy said, “We are continuing to see growth in our gross margin and overall sales volumes year over year. Despite challenging market conditions relative to a year ago, we were able to grow both the top line and our net income during the third quarter of 2013 as benefits from our acquisition last year continue to take hold.”  
 
Mr. Cowart continued,  “We continue to pursue both organic growth such as our recent entry into the Dallas-Fort Worth used oil collection market as well as growth through acquisition as evidenced by our recent transaction with E-Source.” Mr. Cowart concluded, “We believe that our progress through three quarters of 2013, as well as recent efforts to expand our customer base for finished product and our overall collection footprint, will result in a year-end revenue figure of between $140 million and $150 million,  net income to be greater than $5 million, with fully diluted earnings per share in excess of $0.30.”
 
CONFERENCE CALL
 
As previously announced, management of Vertex Energy will host a conference call today, November 6th, at 10:00 a.m. EDT. Those who wish to participate in the conference call may telephone 877-407-4019 from the U.S. International callers may telephone 201-689-8337, approximately 15 minutes before the call. A webcast will also be available at: www.vertexenergy.com.
 
A digital replay will be available by telephone approximately two hours after the completion of the call and may be accessed by dialing 877-660-6853 from the U.S. or 201-612-7415 for international callers, and using the Conference ID #: 417977.
 
ABOUT VERTEX ENERGY, INC.
 
Vertex Energy, Inc. (NASDAQ:VTNR), is a leading environmental services company that recycles industrial waste streams and off-specification commercial chemical products. Its primary focus is recycling used motor oil and other petroleum by-product streams. Vertex Energy purchases these streams from an established network of local and regional collectors and generators. The company also manages the transport, storage and delivery of the aggregated feedstock and product streams to end users, and manages the re-refining of a portion of its aggregated petroleum streams in order to sell them as higher-value end products. Vertex Energy sells its aggregated petroleum streams as feedstock to other re-refineries and fuel blenders or as replacement fuel for use in industrial burners. The re-refining of used motor oil that Vertex Energy manages takes place at the company’s facility, which uses a proprietary Thermal Chemical Extraction Process ("TCEP") technology. Based in Houston, Texas, Vertex Energy also has offices in Georgia and California. More information on the company can be found at www.vertexenergy.com.
 
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," "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.
 

 
 
 

VERTEX ENERGY, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)

   
September 30,
    
December 31,
  
   
2013
    
2012
  
ASSETS
            
             
Current assets
            
  Cash and cash equivalents
  
$
531,226
    
$
807,940
  
  Accounts receivable, net
    
7,955,601
      
7,160,780
  
  Inventory
    
8,208,121
      
5,870,121
  
  Prepaid expenses
    
571,392
      
492,467
  
      Total current assets
    
17,266,340
      
14,331,308
  
                 
Noncurrent assets
                
  Fixed assets, net
    
11,963,374
      
11,617,368
  
  Intangible assets, net
    
15,036,770
      
15,934,724
  
  Goodwill
    
3,515,977
      
3,515,977
  
  Deferred federal income taxes
    
3,863,000
      
3,703,000
  
      Total noncurrent assets
    
34,379,121
      
34,771,069
  
                 
TOTAL ASSETS
  
$
51,645,461
    
$
49,102,377
  
                 
LIABILITIES AND STOCKHOLDERS’ EQUITY
                
                 
 Current liabilities
                
   Accounts payable and accrued expenses
  
$
12,385,290
    
$
8,869,234
  
   Line of credit
    
3,500,000
      
-
  
   Current portion of long-term debt
    
1,700,000
      
 1,749,329
  
        Total current liabilities
    
17,585,290
      
10,618,563
  
                 
Long-term liabilities
                
Long-term debt
    
4,958,333
      
6,281,457
  
    Contingent consideration
    
2,861,000
      
4,711,000
  
    Line of credit
    
-
      
6,750,000
  
    Deferred federal income tax
    
357,000
      
341,000
  
        Total liabilities
    
25,761,623
      
28,702,020
  
                 
Commitments and contingencies
                
                 
STOCKHOLDERS’ EQUITY
                
                 
Preferred stock, $0.001 par value per share:
                
50,000,000 shares authorized
                
Series A Convertible Preferred stock, $0.001 par value,
    5,000,000 authorized and 1,323,837 and 1,512,891  issued
    and outstanding at September 30, 2013 and  December 31,
    2012, respectively
    
1,324
      
    1,513
  
Common stock, $0.001 par value per share;
                
   750,000,000 shares authorized; 17,804,724 and 16,965,464
   issued and outstanding at September 30, 2013 and
   December 31, 2012, respectively
    
  17,805
      
  16,965
  
Additional paid-in capital
    
10,897,515
      
10,719,345
  
Retained earnings
    
14,967,194
      
9,662,534
  
      Total stockholders’ equity
    
25,883,838
      
20,400,357
  
                 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
  
$
51,645,461
    
$
49,102,377
  


 
 
 
 
VERTEX ENERGY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2013 AND 2012
(UNAUDITED)
 
   
Three Months Ended
September 30,
    
Nine Months Ended
September 30,
  
   
2013
    
2012
    
2013
    
2012
  
                         
Revenues
  
$
46,830,647
    
$
36,195,570
    
$
115,196,850
    
$
102,316,702
  
                                 
Cost of revenues
    
41,945,879
      
33,011,934
      
104,287,660
      
95,497,261
  
                                 
Gross profit
    
4,884,768
      
3,183,636
      
10,909,190
      
6,819,441
  
                                 
Reduction of contingent liability
    
-
      
-
      
(1,850,000
)
    
-
  
                                 
Selling, general and administrative expenses
  (exclusive of acquisition related expenses)
    
2,495,748
      
 1,610,146
      
7,129,673
      
3,724,120
  
  Acquisition related expenses
    
-
      
1,154,612
      
  -
      
1,154,612
  
                                 
Total selling, general and
   administrative expenses
    
2,495,748
      
 2,764,758
      
7,129,673
      
4,878,732
  
                                 
Income from operations
    
2,389,020
      
418,878
      
5,629,517
      
1,940,709
  
                                 
Other income (expense)
                                
   Other income
    
-
      
949
      
-
      
1,582
  
   Other expense
    
(3,949
)
    
-
      
(31,690
)
    
-
  
   Interest expense
    
(95,488
)
    
(28,972
)
    
(314,627
)
    
(29,016
)
Total other (expense)
    
(99,437
)
    
(28,023
)
    
(346,317
)
    
(27,434
)
                                 
Income before income tax
    
2,289,583
      
390,855
      
5,283,200
      
1,913,275
  
                                 
Income tax benefit
    
40,211
      
1,714,813
      
21,460
      
1,607,641
  
                                 
Net income
  
$
2,329,794
    
$
2,105,668
    
$
5,304,660
    
$
3,520,916
  
                                 
Earnings  per common share
                                
     Basic
  
$
0.13
    
$
0.17
    
$
0.30
    
$
0.35
  
     Diluted
  
$
0.12
    
$
0.13
    
$
0.27
    
$
0.25
  
                                 
Shares used in computing earnings per share
                                
     Basic
    
17,715,786
      
12,255,372
      
17,402,501
      
10,085,206
  
     Diluted
    
19,997,257
      
16,484,023
      
19,766,263
      
14,358,691
  


 
 
 
 
VERTEX ENERGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 2013 AND 2012
(UNAUDITED)
 
   
Nine Months Ended
  
   
September 30,
2013
    
September 30,
2012
  
 
             
Cash flows from operating activities
            
  Net income
  
$
5,304,660
    
$
3,520,916
  
  Adjustments to reconcile net income to cash
  provided by operating activities
                
         Stock-based compensation expense
    
123,571
      
124,626
  
         Depreciation and amortization
    
1,615,657
      
180,402
  
         Deferred federal income tax
    
(144,000
)
    
(1,639,000
)
         Reduction of contingent liability
    
(1,850,000
)
    
-
  
     Changes in operating assets and liabilities
                
       Accounts receivable
    
(794,821
)
    
(1,073,778
)
       Accounts receivable-other
    
 -
      
(127,162
)
       Accounts receivable- related parties
    
-
      
2,459
  
       Inventory
    
(2,338,000
)
    
(85,658
)
       Prepaid expenses
    
(78,925
)
    
23,313
  
       Accounts payable
    
3,516,056
      
1,005,932
  
       Accounts payable-related parties
    
-
      
296,795
  
       Deposits
    
-
      
(235,557
)
  Net cash provided by operating activities
    
5,354,198
      
1,993,288
  
                 
Cash flows from investing activities
                
   Purchase of intangible assets
    
-
      
(209,061
)
   Acquisition, net
    
(67,972
)
    
(1,319,015
)
   Refund of asset acquisition
    
675,558
      
-
  
   Purchase of fixed assets
    
(1,671,295
)
    
(77,232
)
   Net cash used in investing activities
    
(1,063,709
)
    
(1,605,308
)
                 
Cash flows from financing activities
                
  Line of credit payments, net
    
(3,250,000
)
    
-
  
  Payments on note payable
    
(1,372,453
)
    
(3,777
)
  Proceeds from exercise of common stock warrants
    
55,250
      
91,625
  
  Net cash provided by (used in) financing activities
    
(4,567,203
)
    
87,848
  
                 
Net increase (decrease) in cash and cash equivalents
    
(276,714
)
    
475,828
  
                 
Cash and cash equivalents at beginning of the period
    
807,940
      
675,188
  
                 
Cash and cash equivalents at end of period
  
$
531,226
    
$
1,151,016
  
                 
SUPPLEMENTAL INFORMATION
                
   Cash paid for interest during the period
  
$
323,956
    
$
1,005
  
   Cash paid for income taxes during the period
  
$
122,001
    
$
6,187
  
                 
NON-CASH TRANSACTIONS
                
   Conversion of Series A Preferred Stock into common stock
  
$
189
    
$
78
  
 
 
 
 
 
 
Contacts
 
Porter, LeVay & Rose, Inc.
 
Marlon Nurse, D.M., 212-564-4700
 
VP – Investor Relations
 
or
 
Vertex Energy
 
Matthew Lieb, 310-230-5450
 
COO
 

Vertex Energy Inc. Reports