Aegean Marine Petroleum Network Inc. Announces Fourth Quarter 2012 Financial Results Reports Eighth Consecutive Quarter of Profitability PR Newswire PIRAEUS, Greece, Feb. 27, 2013 PIRAEUS, Greece, Feb. 27, 2013 /PRNewswire/ --Aegean Marine Petroleum Network Inc. (NYSE: ANW) ("Aegean" or the "Company") today announced financial and operating results for the fourth quarter ended December 31, 2012. Fourth Quarter and Full Year Highlights oRecorded sales volumes of 2,729,070 metric tons in Q4 2012 and 10,620,864 metric tons for the full year. oExpanded gross profit to $71.8 million in Q4 2012 and $302.6 million for the full year. oRecorded operating income of $11.3 million in Q4 2012 and $55.0 million for the full year. oOperating income adjusted for the sale of non-core assets was $13.0 million in Q4 2012 and $61.0 million for the full year. oRecorded net income of $3.3 million attributable to Aegean shareholders or $0.07 basic and diluted earnings per share in Q4 2012 and $20.1 million or $0.44 basic and diluted earnings per share for the full year. oNet income attributable to Aegean shareholders adjusted for the sale of a vessel was $5.1 million or $0.11 basic and diluted earnings per share in Q4 2012 and $26.0 million or $0.56 basic and diluted earnings per share for the full year. oRecorded EBITDA of $19.5 million in Q4 2012 and $87.6 million for the full year. oEBITDA adjusted for the sale of vessels was $21.3 million in Q4 2012 and $93.6 million for the full year. "Our eighth consecutive quarter of profitability rounded out a year of strong performance for Aegean," said E. Nikolas Tavlarios, President. "During the fourth quarter we further strengthened our integrated marine fuel logistics chain and continued to build volume in our lubricants business." Mr. Tavlarios continued, "Throughout 2012, we grew our business across all key areas as we executed on our growth initiatives, made notable progress in diversifying and expanding our revenue base and increased our global market share. At the same time, we reduced our operating expense structure and leveraged our fixed infrastructure – both of which positively impacted our bottom line." The Company achieved net income attributable to Aegean shareholders for the three months ended December 31, 2012 of $3.3 million, or $0.07 basic and diluted earnings per share. Net income attributable to AMPNI shareholders excluding a non-cash loss from the sale of a non-core vessel was $5.1 million or $0.11 basic and diluted earnings per share. For the three months ended December 31, 2011 the Company recorded net income of $6.3 million, or $0.14 basic and diluted earnings per share. Total revenues for the three months ended December 31, 2012, of $1,734.7 million were consistent with the $1,740.3 million reported for the same period in 2011. For the three months ended December 31, 2012, sales of marine petroleum products of $1,724.0 million were also in-line with sales of $1,729.0 million for the same period in 2011. Gross profit, which equals total revenue less directly attributable cost of revenue decreased by 4.77% to $71.8 million in the fourth quarter of 2012 compared with $75.4 million in the same period in 2011. For the three months ended December 31, 2012, the volume of marine fuel sold by the Company increased by 6.24% to 2,729,070 metric tons compared with 2,568,714 metric tons in the same period in 2011. Operating income for the fourth quarter of 2012 decreased by 35.8% to $11.3 million as compared to $17.6 million for the same period in 2011. Operating income excluding a non-cash loss from the sale of a non-core vessel was $13.0 million. Operating expenses excluding net book gain or loss on sale of vessels increased by $1.0 million, or 1.8%, to $58.8 million for the three months ended December 31, 2012, compared with $57.8 million for the same period in 2011. Mr. Tavlarios concluded, "Looking ahead to 2013, despite the challenging macroeconomic environment, we believe our focus on profitable volume growth, diversification and operational efficiencies will allow Aegean to achieve continued growth and enhance shareholder value." Liquidity and Capital Resources Net cash provided by operating activities was $42.5 million for the three months ended December 31, 2012. Net income, as adjusted for non-cash items (as defined in Note 9) was $15.6 million for the period. Net cash used in investing activities was $27.7 million for the three months ended December 31, 2012, mainly due to the advances for other fixed assets under construction. Net cash used in financing activities was $15.1 million for the three months ended December 31, 2012, primarily driven by the pay down of net borrowings. As of December 31, 2012, the Company had cash and cash equivalents of $77.2 million and working capital of $53.0 million. Non-cash working capital, or working capital excluding cash and debt, was $434.7 million. As of December 31, 2012, the Company had $326.4 million in available liquidity, which includes unrestricted cash and cash equivalents of $77.2 million and available undrawn amounts under the Company's working capital facilities of $249.2 million, to finance working capital requirements. The weighted average basic and diluted shares outstanding for the three months ended December 31, 2012 were 45,501,233. The weighted average basic and diluted shares outstanding for the three months ended December 31, 2011 were 45,350,768. Spyros Gianniotis, Chief Financial Officer, stated, "2012 was another strong year for the Company as we grew our base business and developed new revenue streams while improving the Company's cost structure. We executed on our strategy to sell non-core assets, which allowed us to reduce our expenditures related to maintenance and, at the same time, increase our fleet utilization and enhance overall profitability. As we leverage our dynamic financial model, we will use the financial flexibility it creates to invest in growth opportunities that we believe will create significant long-term value. We are well positioned to succeed should industry headwinds continue longer than anticipated, and at the same time, we have positioned the company to capitalize on improving macro fundamentals as they emerge." Summary Consolidated Financial and Other Data (Unaudited) For the Three Months Ended For the Year Ended December 31, December 31, 2011 2012 2011 2012 (in thousands of U.S. dollars, unless otherwise stated) Income Statement Data: Revenues - third $ 1,728,794 $ 1,728,984 $ 6,910,348 $ 7,207,813 parties Revenues - related 11,554 5,730 55,117 51,147 companies Total revenues 1,740,348 1,734,714 6,965,465 7,258,960 Cost of revenues - 1,572,125 1,561,464 6,284,179 6,498,967 third parties Cost of revenues– 92,775 101,401 404,988 457,344 related companies Total cost of 1,664,900 1,662,865 6,689,167 6,956,311 revenues Gross profit 75,448 71,849 276,298 302,649 Operating expenses: Selling and 49,393 50,734 192,846 210,236 distribution General and 8,038 7,703 29,806 29,897 administrative Amortization of 392 375 1,461 1,505 intangible assets Loss on sale of - 1,748 8,682 5,966 vessels, net Operating income 17,625 11,289 43,503 55,045 Net financing cost 7,573 7,279 27,807 32,260 Foreign exchange 1, 116 (982) (1,440) (3,786) losses (gains), net Income taxes 2,125 1,339 5,428 4,122 Net income 6,811 3,653 11,708 22,449 Less income attributable to 518 309 1,480 2,372 non-controlling interest Net income attributable to $ 6,293 $ 3,344 $ 10,228 $ 20,077 AMPNI shareholders Basic earnings per share (U.S. $ 0.14 $ 0.07 $ 0.22 $ 0.44 dollars) Diluted earnings per share (U.S. $ 0.14 $ 0.07 $ 0.22 $ 0.44 dollars) EBITDA^(1) $ 23,856 $ 19,525 $ 73,791 $ 87,639 Other Financial Data: Gross spread on marine petroleum $ 70,045 $ 64,663 $ 256,960 $ 268,804 products^(2) Gross spread on 530 928 1,965 3,077 lubricants^(2) Gross spread on 69,515 63,735 254,995 265,727 marine fuel^(2) Gross spread per metric ton of marine 27.1 23.4 24.0 25.0 fuel sold (U.S. dollars) ^ (2) Net cash provided by/ (used in) $ 45,454 $ 42,472 $ (44,865) $ 122,328 operating activities Net cash used in investing 18,551 27,733 45,589 56,971 activities Net cash provided by/ (used in) 5,181 (15,119) 73,169 (57,127) financing activities Sales Volume Data (Marine Fuel Metric Tons): ^ (3) Total sales volumes 2,568,714 2,729,070 10,646,271 10,620,864 Other Operating Data: Number of owned bunkering tankers, 58.0 57.0 58.0 57.0 end of period^(4) Average number of owned bunkering 57.6 57.0 56.3 58.42 tankers^(4)(5) Special Purpose Vessels, end of 1.0 1.0 1.0 1.0 period^(6) Number of owned storage facilities, 8.0 7.0 8.0 7.0 end of period^(7) Summary Consolidated Financial and Other Data (Unaudited) As of As of December 31, 2011 December 31 2012 (in thousands of U.S. dollars, unless otherwise stated) Balance Sheet Data: Cash and cash equivalents 68,582 77,246 Gross trade receivables 526,450 477,738 Allowance for doubtful accounts (1,354) (3,503) Inventories 204,057 180,826 Current assets 851,991 787,795 Total assets 1,472,438 1,431,843 Trade payables 250,810 242,899 Current liabilities (including current portion 650,810 734,751 of long-term debt) Total debt 706,916 653,286 Total liabilities 992,896 927,325 Total stockholder's equity 479,542 504,518 Working Capital Data: Working capital^(8) 201,181 53,044 Working capital excluding cash and debt^(8) 497,925 434,675 Notes: 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 1. our calculation of EBITDA may not be comparable to that recorded by other companies. EBITDA is included herein because it is a basis upon which the Company assesses its operating performance and because the Company believes that it presents useful information to investors regarding a company's ability to service and/or incur indebtedness. The following table reconciles net income to EBITDA for the periods presented: For the Three Months Ended For the Year Ended December 31, December 31, 2011 2012 2011 2012 Net income attributable to 6,293 3,344 10,228 20,077 AMPNI shareholders Add: Net financing cost including amortization of 7,573 7,279 27,807 32,260 financing costs Add: Income tax expense 2,125 1,339 5,428 4,122 Add: Depreciation and amortization excluding 7,865 7,563 30,328 31,180 amortization of financing costs EBITDA 23,856 19,525 73,791 87,639 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 lubircants are not items recognized by U.S. GAAP and should be 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 2. 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 MonthsEnded For the Year Ended December 31, December 31, 2011 2012 2011 2012 Sales of marine petroleum 1,729,005 1,724,034 6,925,582 7,208,440 products Less: Cost of marine (1,658,960) (1,659,371) (6,668,622) (6,939,636) petroleum products sold Gross spread on marine 70,045 64,663 256,960 268,804 petroleum products Less: Gross spread on (530) (928) (1,965) (3,077) lubricants Gross spread on marine 69,515 63,735 254,995 265,727 fuel Sales volume of marine 2,568,714 2,729,070 10,646,271 10,620,864 fuel (metric tons) Gross spread per metric ton of marine 27.1 23.4 24.0 25.0 fuel sold (U.S. dollars) Sales volume of marine fuel is the volume of sales of various 3. classifications of MFO and MGO for the relevant period and is denominated in metric tons. The Company does not use the sales volume of lubricants as an indicator. The Company's markets include its physical supply operations in the United Arab Emirates, Gibraltar, Jamaica, Singapore, Northern Europe, Ghana, Vancouver, Montreal, Mexico, Portland (U.K.), Trinidad and Tobago (Southern Caribbean), Tangiers (Morocco), Las Palmas, Tenerife, Panama, Hong Kong and Greece, where the Company conducts operations through its related company, Aegean Oil. 4. Bunkering fleet comprises both bunkering vessels and barges. 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 5. 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. As of December, ^ 2012 the Company owned one Panamax tanker, the Aeolos, and one Aframax tanker, the Leader as floating storage facilities in Gibraltar and United Arab Emirates. Additionally, the Company operates a 7. barge, the Mediterranean, as a floating storage facility in Greece and a small tanker, the Tapuit, as a floating storage facility in Northern Europe. The Company also has on-land storage facilities in Portland, Las Palmas, Tangiers and Panama. 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. Working capital is defined as current assets minus current liabilities. 8. 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. Net income as adjusted for non-cash items, such as depreciation, provision for doubtful accounts, restricted stock, amortization, deferred income taxes, loss on sale of vessels, net, unrealized loss/(gain) on derivatives and unrealized foreign exchange loss/(gain), net, is an industry standard 9. used to assist in evaluating a company's 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. Fourth Quarter 2012 Dividend Announcement On February 27, 2013, the Company's Board of Directors declared a fourth quarter 2012 dividend of $0.01 per share payable on March 27, 2013 to shareholders of record as of March 13, 2013. 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 Thursday, February 28, 2013 at 8:30 a.m. Eastern Time, to discuss its fourth 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 (888) 471-3843 (for U.S.-based callers) or (719) 785-1753 (for international callers) and enter the passcode: 6428029. A replay of the webcast will be available soon after the completion of the call and will be accessible on www.ampni.com. A telephone replay will be available through March 14, 2013 by dialing (888) 203-1112 or (for U.S.-based callers) or (719) 457-0820 (for international callers) and enter the passcode: 6428029. 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 20 markets, including Vancouver, Montreal, Mexico, Jamaica, Trinidad and Tobago, West Africa, Gibraltar, U.K., Northern Europe, Piraeus, Patras, the United Arab Emirates, Singapore, Morocco, the Antwerp-Rotterdam-Amsterdam (ARA) region, Las Palmas, Tenerife, Panama and Hong Kong, and plans to commence operations in Barcelona, Spain during the first quarter of 2013. The Company has also entered into a strategic alliance to extend its global reach to China. To learn more about Aegean, visit http://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. SOURCE Aegean Marine Petroleum Network Inc. Website: http://www.ampni.com Contact: Aegean Marine Petroleum Network Inc., +1-203-595-5184
Aegean Marine Petroleum Network Inc. Announces Fourth Quarter 2012 Financial Results
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