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Arabian American Releases Fourth Quarter and Full Year 2012 Results



     Arabian American Releases Fourth Quarter and Full Year 2012 Results

Record Year for Revenue and Volume

Earnings Call today at 4:30pm ET

PR Newswire

SUGAR LAND, Texas, March 7, 2013

SUGAR LAND, Texas, March 7, 2013 /PRNewswire/ -- Arabian American Development
Co. (NYSE:ARSD) released their financial results for the fourth quarter and
full year ended December 31, 2012.

"We are happy to report record revenue and volume for 2012 and delighted with
the progress made during the year by the Al Masane Al Kobra Mining Co.
("AMAK") mine which achieved important shipping and production milestones
after years of development," said Nick Carter, President and Chief Executive
Officer of Arabian American.  "While we exited 2012 waiting on customer
orders, we are now seeing orders resume on pace to maximize the utilization of
our capacity this calendar year. Combined with ongoing AMAK shipments of
copper and zinc concentrate, we believe that we have good momentum moving into
2013."  

Mr. Carter continued, "There is a change to be noted in these financial
statements that is important to the clarity of our information.  As we had
mentioned in previous communications, based upon the receipt of accurate
financial information for our investment in AMAK as of and for the years ended
December 31, 2012, 2011 and 2010 and also our ability to significantly
influence the operation of the company, we concluded in the fourth quarter of
2012 that our investment in AMAK should be presented using the equity method
of accounting.  The investment had previously been presented using the cost
method as of and for the years ended December 31, 2011 and 2010.  The 2011
financial statements, as set forth herein, have been adjusted to apply the
change in accounting method retroactively.  We believe that now and going
forward, this will present a more accurate picture of the value and
performance of this investment"

Fourth Quarter and Full Year 2012 Highlights
Revenue for the quarter was $49.9 million, a 18.8% decrease from the fourth
quarter of 2011, and an 8% sequential decrease as compared to the third
quarter of 2012. Revenue for the full year was a record $223 million, a 11.7%
increase from $200 million in 2011.

Volume for the quarter was 14.1 million gallons versus 16.9 million gallons
for the same period of 2011, a decrease of 16.8%.  Full year volume was a
record 63.6 million for 2012 compared to 54.3 million in 2011, a 17.1%
increase. 

Gross profit for the quarter was $6.9 million compared to $10.2 million in
2011, a 32.0% decrease.  Gross profit for full year 2012 was $30.8 million
compared to $25.9 million, an 18.7% increase.

Adjusted EBITDA for the fourth quarter was $3.7 million compared to $7.2
million for fourth quarter 2011.  Adjusted EBITDA for the full year 2012 was
$20.9 million compared to $16.9 million for the full year 2011. 

Net income for the fourth quarter including our equity in AMAK was $2.9
million or $0.12 per share as compared to net income of $3.8 million or $0.16
per share in the fourth quarter of 2011. Net income including our equity in
earnings from AMAK for the full year was $11.4 million or $0.46 per diluted
share as compared to net income of $13.9 million or $0.57 per diluted share in
the prior year.  The change in accounting method for AMAK increased diluted
2011 EPS by approximately $.22 from what was originally reported.

We completed the year with $9.5 million in cash compared to $6.7 million as of
December 31, 2011.  We had $29.2 million in working capital compared to $29.7
million at 2011 year end and a current ratio of 3.4 to 1.

Earnings Call
Arabian American will host a conference call and live webcast at 4:30 p.m.
Eastern Time, today. All parties interested in participating should call
1-877-941-4774 if calling within the United States or 1-480-629-9760 if
calling internationally. An audio playback will be available until March 14,
2013. To listen to the playback, please call 1-877-870-5176 if calling within
the United States or 1-858-384-5517 if calling internationally. Use pin number
4601831 for the audio replay.

A link to the simultaneous webcast of today's call will be available at
http://www.arabianamericandev.com under the investor relations tab and is
available through Windows Media Player or RealPlayer. A webcast replay of the
call will also be available on the Company's website under the investor
relations tab for one year after the call date.

About Arabian American Development Company (ARSD)
ARSD owns and operates a petrochemical facility located in southeast Texas,
just north of Beaumont which specializes in high purity petrochemical solvents
and other solvent type manufacturing. The Company is also the original
developer and a 35% owner of Al Masane Al Kobra Mining Co., a Saudi Arabian
joint stock company.

Use of Non-GAAP Measures
The Company reports its financial results in accordance with U.S. generally
accepted accounting principles ("GAAP").  This press release contains the
non-GAAP measure of EBITDA.  We have also included "adjusted EBITDA" which
excludes the effect of equity in earnings (loss) from AMAK. Our non-GAAP
measures are not meant to be considered in isolation or as a substitute for
comparable GAAP measures and should be read only in conjunction with our
consolidated financial statements prepared in accordance with GAAP.

Forward-Looking Statements
Statements in this press release that are not historical facts are forward
looking statements as defined in the Private Securities Litigation Reform Act
of 1995. Forward looking statements are based upon our belief, as well as,
assumptions made by and information currently available to us. Because such
statements are based upon expectations as to future economic performance and
are not statements of fact, actual results may differ from those projected.
These risks, as well as others, are discussed in greater detail in Arabian
American's filings with the Securities and Exchange Commission, including
Arabian American's Annual Report on Form 10-K for the year ended December 31,
2012, and the Company's subsequent Quarterly Reports on Form 10-Q.  All
forward-looking statements included in this press release are based upon
information available to the company as of the date of this press release. 

Company Contact:
Nick Carter, President and Chief Executive Officer
(409) 385-8300
ncarter@arabianamericandev.com

Investor Relations Contact:
Kim Rogers-Carrete, Principal
Genesis Select
(303) 415-0200
krogersc@genesisselect.com

Or

Matthew Selinger, Principal
Genesis Select
(303) 415-0200
mselinger@genesisselect.com

 

- Tables follow –

 

ARABIAN AMERICAN DEVELOPMENT COMPANY AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
                                                        December 31,
                                                        2012       2011
                                                                   (restated)
                                                        (thousands of dollars)
ASSETS
CURRENT ASSETS
  Cash and cash equivalents                             $   9,508  $   6,674
  Derivative instruments                                -          393
  Trade receivables, net                                15,802     23,198
  Advance to AMAK                                       2,162      120
  Prepaid expenses and other assets                     1,561      562
  Contractual based intangible assets                   250        250
  Inventories                                           9,840      9,456
  Deferred income taxes                                 1,054      1,169
  Taxes receivable                                      1,182      -
          Total current assets                          41,359     41,822
  PLANT, PIPELINE, AND EQUIPMENT – AT COST              68,482     60,624
    LESS ACCUMULATED DEPRECIATION                       (28,062)   (23,672)
  PLANT, PIPELINE, AND EQUIPMENT, NET                   40,420     36,952
  INVESTMENT IN AMAK                                    38,971     38,105
  MINERAL PROPERTIES IN THE UNITED STATES               588        588
CONTRACTUAL BASED INTANGIBLE ASSETS, net of current     104        355
portion 
  OTHER ASSETS                                          11         11
TOTAL ASSETS                                            $ 121,453  $ 117,833

 

 

ARABIAN AMERICAN DEVELOPMENT COMPANY AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS - Continued
                                                        December 31,
                                                        2012       2011
                                                                   (restated)
                                                        (thousands of dollars)
LIABILITIES
  CURRENT LIABILITIES
    Accounts payable                                    $  6,306   $  5,857
    Accrued interest                                    96         116
    Current portion of derivative instruments           301        345
    Accrued liabilities                                 2,687      2,944
    Accrued liabilities in Saudi Arabia                 140        140
    Notes payable                                       12         12
    Current portion of post-retirement benefit          269        258
    Current portion of long-term debt                   1,500      1,500
    Current portion of other liabilities                880        937
          Total current liabilities                     12,191     12,109
  LONG-TERM DEBT, net of current portion                14,239     22,739
  POST- RETIREMENT BENEFIT, net of current portion      649        649
  DERIVATIVE INSTRUMENTS, net of current portion        592        789
  OTHER LIABILITIES, net of current portion             379        1,071
  DEFERRED INCOME TAXES                                 10,094     9,394
          Total liabilities                             38,144     46,751
COMMITMENTS AND CONTINGENCIES
EQUITY
  Common Stock ‑ authorized 40 million shares of $.10
par value;

      issued and outstanding, 23.8 million and 23.7     2,381      2,373
million shares

      in 2012 and 2011, respectively
  Additional Paid-in Capital                            44,791     44,138
  Accumulated Other Comprehensive Loss                  (580)      (748)
  Retained Earnings                                     36,428     25,030
 Total Arabian American Development Company
Stockholders'                                           83,020     70,793

    Equity
 Noncontrolling interest                                289        289
       Total equity                                     83,309     71,082
     TOTAL LIABILITIES AND EQUITY                       $ 121,453  $ 117,833

 

 

ARABIAN AMERICAN DEVELOPMENT COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME
                                    THREE MONTHS ENDED   12 MONTHS ENDED
                                    31-Dec               31-Dec
                                    2012      2011       2012       2011
                                              (restated)            (restated)
                                    (thousands of dollars)
REVENUES
  Petrochemical Product Sales       $  48,831 $ 60,183   $  218,512 $  194,620
  Processing Fees                   1,106     1,295      4,346      4,897
                                    49,937    61,478     222,858    199,517
OPERATING COSTS AND EXPENSES
  Cost of Petrochemical Product
    Sales and Processing            43,031    51,317     192,100    173,600
   GROSS PROFIT                     6,906     10,161     30,758     25,917
GENERAL AND ADMINISTRATIVE
EXPENSES
  General and Administrative        4,027     3,643      12,782     11,778
  Depreciation                      145       120        520        476
                                    4,172     3,763      13,302     12,254
OPERATING INCOME                    2,734     6,398      17,456     13,663
OTHER INCOME (EXPENSE)
  Interest Income                   1         -          3          4
  Interest Expense                  (112)     (185)      (547)      (699)
  Losses on cash flow hedge         (84)      (98)       (359)      (414)
reclassified from OCI
  Equity in earnings (loss) from    1,419     (255)      192        (1,018)
AMAK
  Gain on additional equity issue   184       -          674        8,850
by AMAK
  Miscellaneous Income (Expense)    (25)      (12)       (117)      3
                                    1,383     (550)      (154)      6,726
 INCOME BEFORE INCOME TAX EXPENSE   4,117     5,848      17,302     20,389
INCOME TAXES                        1,190     2,026      5,904      6,505
  NET INCOME                        2,927     3,822      11,398     13,884
NET LOSS ATTRIBUTABLE TO            -         -          -          -
NONCONTROLLING INTEREST
NET INCOME ATTRIBUTABLE TO          $   2,927 $  3,822   $ 11,398   $ 13,884
ARABIAN AMERICAN DEVELOPMENT CO.
Net income per common share
  Basic earnings per share          $0.12     $0.16      $0.47      $0.58
  Basic weighted average number
                                    24,105    24,001     24,081     23,993
  of common shares outstanding
  Diluted earnings per share        $0.12     $0.16      $0.46      $0.57
  Diluted weighted average number
                                    24,704    24,523     24,745     24,267
  of common shares outstanding

 

 

ARABIAN AMERICAN DEVELOPMENT COMPANY AND SUBSIDIARIES RECONCILIATION OF
SELECTED
GAAP MEASURES TO NON-GAAP MEASURES^(1)
                         THREE MONTHS ENDED          12 MONTHS ENDED
                         31-Dec                      31-Dec
                         2012          2011          2012        2011
                         (in thousands)
NET INCOME               $             $             $           $            
                          2,927         3,822            11,398    13,884
Add back:
  Interest               196           283           906         1,113
  Taxes                  1,190         2,026         5,904       6,505
  Depreciation           145           120           520         476
  Depreciation in Cost   817           695           3,053       2,744
of sales
EBITDA                   $             $             $           $            
                          5,275         6,946            21,781    24,722
  Equity in (earnings)   (1,603)       255           (866)       (7,832)
losses in AMAK
Adjusted EBITDA          $             $             $           $            
                          3,672         7,201            20,915    16,890

                                     12/31/2012           12/31/2011
                                     (in thousands except (in thousands except
                                     ratio)               ratio)
Current assets                       $ 41,359             $ 41,822
Current liabilities                  $ 12,191             $ 12,109
Working capital                      $ 29,168             $ 29,713
(current assets less current
liabilities)
Current ratio                        3.4
 (current assets divided by current
liabilities)

 

(1) This press release includes non-GAAP measures.  Our non-GAAP measures are
not meant to be considered in isolation or as a substitute for comparable GAAP
measures and should be read only in conjunction with our consolidated
financial statements prepared in accordance with GAAP.

 

SOURCE Arabian American Development Co.

Website: http://www.arabianamericandev.com
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