HOUSTON, March 4, 2021 /PRNewswire/ -- Adams Resources
& Energy, Inc. (NYSE AMERICAN: AE) ("Adams" or the "Company") today announced
operational and financial results for the three months and year
ended December 31, 2020.
Fourth Quarter 2020 Financial Highlights
- Generated net earnings of $5.8
million, or $1.37 per diluted
common share, on revenues of $249.8
million for the fourth quarter of 2020, compared to
$2.7 million, or $0.63 per diluted common share, on revenues of
$431.3 million for the fourth quarter
of 2019.
- Grew net cash provided by operating activities to $6.1 million for the fourth quarter of 2020 from
$3.8 million for the fourth quarter
of 2019. The increase was primarily driven by changes in working
capital and higher cash-based earnings in the 2020 period.
- Reported adjusted net earnings of $2.8
million, or $0.65 per diluted
common share, for the fourth quarter of 2020, compared to
$0.9 million, or $0.22 per diluted common share, for the fourth
quarter of 2019.
- Increased adjusted cash flow by 12% to $6.1 million for the fourth quarter of 2020 from
$5.5 million for the fourth quarter
of 2019.
Full Year 2020 Financial Highlights
- Generated net earnings of $1.0
million, or $0.23 per diluted
common share, on revenues of $1.02
billion for the full year 2020, compared to $8.2 million, or $1.94 per diluted common share, on revenues of
$1.81 billion for the full year
2019.
- Reported net cash used in operating activities of $44.0 million for the full year 2020, compared to
net cash provided by operating activities of $46.9 million for the full year 2019. The
decrease was primarily driven by changes in working capital due to
the volatility in the market price of crude oil during 2020
substantially due to the COVID-19 pandemic.
- Posted adjusted net earnings of $12.2
million, or $2.87 per diluted
common share, for the full year 2020, compared to $4.1 million, or $0.96 per diluted common share, for the full year
2019.
- Grew adjusted cash flow by 24% to $27.2
million for the full year 2020 from $21.9 million for the full year 2019.
Adjusted net earnings, adjusted earnings per diluted 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.
Additional Key Highlights
- Marketed 86,577 barrels per day ("bpd") of crude oil during the
fourth quarter of 2020 through GulfMark Energy, Inc. ("GulfMark"),
Adams' crude oil marketing
subsidiary, compared to 108,627 bpd during the fourth quarter of
2019 and 90,896 bpd for the third quarter of 2020. For the full
year 2020, GulfMark marketed 91,957 bpd of crude oil versus 107,383
bpd for the full year 2019.
- Traveled 7.48 million miles during the fourth quarter of 2020
through Service Transport Company ("Service Transport"),
Adams' liquid chemicals,
pressurized gases, asphalt and dry bulk transportation subsidiary,
compared to 4.67 million miles during the fourth quarter of 2019
and 7.63 million miles during the third quarter of 2020. For the
full year 2020, Service Transport traveled 24.2 million miles
versus 20.5 million miles for the full year 2019.
- Benefited during the second half of 2020 from the completion of
two strategic acquisitions: (i) the purchase of assets from CTL
Transportation at the end of the second quarter, which increased
Service Transport's collective fleet of tractors and trailers by
more than 50% and expanded the Company's footprint of operations
into important markets in Florida,
Georgia, Illinois, Missouri and Ohio, and (ii) the fourth quarter purchase of
Victoria Express Pipeline and related terminal facilities, which
materially expanded the Company's ability to more effectively serve
the needs of its customers located in key markets on the Gulf Coast
of Texas.
- Paid dividends totaling $0.96 per
common share in 2020. The Company has consistently paid a dividend
since 1994.
- Remained solidly positioned with 421,759 barrels of crude oil
inventory at December 31, 2020
compared to 426,397 barrels at December 31,
2019.
- Entered 2021 with a strong balance sheet and financial
flexibility, including cash and cash equivalents of $39.3 million at December
31, 2020.
- Ended 2020 with a combined owned or leased fleet across
GulfMark and Service Transport of 566 tractors and 1,103 trailers.
Through its continued targeted efforts to maintain a modernized
fleet, Adams' average life of its
tractor fleet was 2.7 years at December 31,
2020 compared to 2.4 years at December 31, 2019.
Kevin J. Roycraft, Adams' Chief Executive Officer, commented,
"Given the challenges faced during 2020 due to the COVID-19
pandemic, we were pleased to report solid full year and fourth
quarter results. Improving year over year adjusted cash flow
and adjusted net earnings by 24% and 199%, respectively, is an
amazing accomplishment by this team considering the economic
backdrop. Contributing to our performance for the fourth
quarter was improved economic conditions and the acquisition of two
complementary businesses during 2020 that materially expanded our
operating footprint and placed us in a stronger position for
continued growth. I want to thank all of our employees once
again for their tireless efforts as we safely serve our
customers. We look forward to operating in an improved
macro-environment during 2021."
Capital Investments and Dividends
During the fourth quarter of 2020, the Company spent capital of
$1.4 million for various
equipment. In addition, Adams paid dividends of $1.0 million ($0.24
per common share).
For the full year 2020, Adams
spent capital of $5.0 million for the
purchase of 17 tractors and other various equipment. In
addition, on June 26, 2020, and
October 22, 2020, the Company
completed the acquisitions of assets from CTL Transportation, which
added 163 tractors and 328 trailers to Service Transport's fleet,
and EnLink Midstream Operating, L.P., which created a new pipeline
and storage business segment for the Company, for an aggregate
purchase price of $30.2
million.
As previously announced on February 19,
2021, the Company's Board of Directors declared a quarterly
cash dividend for the fourth quarter of 2020 in the amount of
$0.24 per common share, payable on
March 19, 2021 to shareholders of
record as of March 5, 2021.
Outlook
Mr. Roycraft concluded, "Our focus for 2021 is to continue to
prudently expand our core businesses, drive further operating
efficiencies and further enhance the quality of our assets.
The purchases of assets from CTL and the Victoria Express Pipeline
and related terminal facilities were key milestones for
Adams, and we plan to leverage our
expanded footprint as we capitalize on multiple initiatives to grow
our customer base and service offerings. Consistent with
these recent transactions, we also look forward to identifying and
executing on new growth opportunities that are adjacent and
complementary to our existing operations."
"Supporting our strategic efforts to expand the business will be
our continued focus on ensuring we maintain a healthy balance sheet
and strong financial position. This has served us well in the
past and will help drive our future success as we provide our
customers unsurpassed service and reliability, and deliver
long-term value for our shareholders."
Use of Non-GAAP Financial Measures
This press release and accompanying schedules includes the
non-GAAP financial measures of adjusted cash flow, adjusted net
earnings and adjusted 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 believes these
measures are useful indicators of the financial performance of our
business and 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,
earnings per share 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. The non-GAAP
financial measures are defined and reconciled in the financial
tables below.
About Adams Resources & Energy, Inc.
Adams Resources & Energy, Inc. is engaged in the business of
crude oil marketing, transportation, terminalling and storage and
tank truck transportation of liquid chemicals, pressurized gases,
asphalt and dry bulk through its subsidiaries, GulfMark Energy,
Inc., Service Transport Company, Victoria Express Pipeline, LLC and
GulfMark Terminals, LLC. 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. Forward-looking statements are subject
to risks and uncertainties that could cause actual results to
differ materially from those expressed or implied in the
forward-looking statements, and any other risk factors included in
Adams' reports filed with the
Securities and Exchange Commission. 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
Tracy E. Ohmart
EVP, Chief Financial Officer
tohmart@adamsresources.com
(713) 881-3609
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,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Revenues:
|
|
|
|
|
|
|
|
Marketing
|
$
|
227,880
|
|
|
$
|
416,646
|
|
|
$
|
950,426
|
|
|
$
|
1,748,056
|
|
Transportation
|
21,603
|
|
|
14,693
|
|
|
71,724
|
|
|
63,191
|
|
Pipeline and
storage
|
272
|
|
|
—
|
|
|
272
|
|
|
—
|
|
Total
revenues
|
249,755
|
|
|
431,339
|
|
|
1,022,422
|
|
|
1,811,247
|
|
|
|
|
|
|
|
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
Marketing
|
218,233
|
|
|
409,394
|
|
|
940,031
|
|
|
1,723,216
|
|
Transportation
|
17,710
|
|
|
12,490
|
|
|
58,888
|
|
|
53,392
|
|
Pipeline and
storage
|
393
|
|
|
—
|
|
|
393
|
|
|
—
|
|
General and
administrative
|
3,254
|
|
|
2,193
|
|
|
10,284
|
|
|
10,198
|
|
Depreciation and
amortization
|
4,963
|
|
|
4,375
|
|
|
18,573
|
|
|
16,641
|
|
Total costs and
expenses
|
244,553
|
|
|
428,452
|
|
|
1,028,169
|
|
|
1,803,447
|
|
|
|
|
|
|
|
|
|
Operating earnings
(losses)
|
5,202
|
|
|
2,887
|
|
|
(5,747)
|
|
|
7,800
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
Gain on dissolution of
investment
|
—
|
|
|
—
|
|
|
—
|
|
|
573
|
|
Interest
income
|
42
|
|
|
621
|
|
|
656
|
|
|
2,766
|
|
Interest
expense
|
(156)
|
|
|
(212)
|
|
|
(444)
|
|
|
(636)
|
|
Total other income
(expense), net
|
(114)
|
|
|
409
|
|
|
212
|
|
|
2,703
|
|
|
|
|
|
|
|
|
|
Earnings (losses)
before income taxes
|
5,088
|
|
|
3,296
|
|
|
(5,535)
|
|
|
10,503
|
|
|
|
|
|
|
|
|
|
Income tax benefit
(provision)
|
758
|
|
|
(643)
|
|
|
6,530
|
|
|
(2,296)
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
$
|
5,846
|
|
|
$
|
2,653
|
|
|
$
|
995
|
|
|
$
|
8,207
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
Basic net earnings per
common share
|
$
|
1.38
|
|
|
$
|
0.63
|
|
|
$
|
0.23
|
|
|
$
|
1.94
|
|
Diluted net earnings
per common share
|
$
|
1.37
|
|
|
$
|
0.63
|
|
|
$
|
0.23
|
|
|
$
|
1.94
|
|
|
|
|
|
|
|
|
|
Dividends per
common share
|
$
|
0.24
|
|
|
$
|
0.24
|
|
|
$
|
0.96
|
|
|
$
|
0.94
|
|
|
|
|
|
|
|
|
|
ADAMS RESOURCES
& ENERGY, INC. AND SUBSIDIARIES
|
UNAUDITED
CONSOLIDATED BALANCE SHEETS
|
(In
thousands)
|
|
|
December
31,
|
|
2020
|
|
2019
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
39,293
|
|
|
$
|
112,994
|
|
Restricted
cash
|
12,772
|
|
|
9,261
|
|
Accounts receivable,
net of allowance for doubtful accounts
|
99,799
|
|
|
94,534
|
|
Inventory
|
19,336
|
|
|
26,407
|
|
Derivative
assets
|
61
|
|
|
—
|
|
Income tax
receivable
|
13,288
|
|
|
2,569
|
|
Prepayments and other
current assets
|
2,964
|
|
|
1,559
|
|
Total current
assets
|
187,513
|
|
|
247,324
|
|
|
|
|
|
Property and
equipment, net
|
94,134
|
|
|
69,046
|
|
Operating lease
right-of-use assets, net
|
8,051
|
|
|
9,576
|
|
Intangible assets,
net
|
4,106
|
|
|
1,597
|
|
Other
assets
|
2,383
|
|
|
3,299
|
|
Total
assets
|
$
|
296,187
|
|
|
$
|
330,842
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
85,991
|
|
|
$
|
147,851
|
|
Accounts payable –
related party
|
—
|
|
|
5
|
|
Derivative
liabilities
|
52
|
|
|
—
|
|
Current portion of
finance lease obligations
|
4,112
|
|
|
2,167
|
|
Current portion of
operating lease liabilities
|
2,050
|
|
|
2,252
|
|
Other current
liabilities
|
22,343
|
|
|
7,302
|
|
Total current
liabilities
|
114,548
|
|
|
159,577
|
|
Other long-term
liabilities:
|
|
|
|
Asset retirement
obligations
|
2,308
|
|
|
1,573
|
|
Finance lease
obligations
|
11,507
|
|
|
4,376
|
|
Operating lease
liabilities
|
6,000
|
|
|
7,323
|
|
Deferred taxes and
other liabilities
|
12,732
|
|
|
6,352
|
|
Total
liabilities
|
147,095
|
|
|
179,201
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
Shareholders'
equity
|
149,092
|
|
|
151,641
|
|
Total liabilities and
shareholders' equity
|
$
|
296,187
|
|
|
$
|
330,842
|
|
ADAMS RESOURCES
& ENERGY, INC. AND SUBSIDIARIES
|
UNAUDITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In
thousands)
|
|
|
Year
Ended
|
|
December
31,
|
|
2020
|
|
2019
|
Operating
activities:
|
|
|
|
Net
earnings
|
$
|
995
|
|
|
$
|
8,207
|
|
Adjustments to
reconcile net earnings to net cash
|
|
|
|
(used in) provided by
operating activities:
|
|
|
|
Depreciation and
amortization
|
18,573
|
|
|
16,641
|
|
Gains on sales of
property
|
(1,859)
|
|
|
(1,400)
|
|
Provision for doubtful
accounts
|
(27)
|
|
|
(12)
|
|
Stock-based
compensation expense
|
643
|
|
|
478
|
|
Deferred income
taxes
|
6,389
|
|
|
2,085
|
|
Net change in fair
value contracts
|
(9)
|
|
|
23
|
|
Gain on dissolution of
AREC
|
—
|
|
|
(573)
|
|
Changes in assets
and liabilities:
|
|
|
|
Accounts
receivable
|
(5,162)
|
|
|
(8,373)
|
|
Accounts
receivable/payable, affiliates
|
(5)
|
|
|
(24)
|
|
Inventories
|
4,751
|
|
|
(3,628)
|
|
Income tax
receivable
|
(10,719)
|
|
|
(165)
|
|
Prepayments and other
current assets
|
(1,401)
|
|
|
(2)
|
|
Accounts
payable
|
(61,116)
|
|
|
31,795
|
|
Accrued
liabilities
|
5,052
|
|
|
1,154
|
|
Other
|
(104)
|
|
|
693
|
|
Net cash (used
in) provided by operating activities
|
(43,999)
|
|
|
46,899
|
|
|
|
|
|
Investing
activities:
|
|
|
|
Property and equipment
additions
|
(5,008)
|
|
|
(35,743)
|
|
Acquisitions
|
(20,200)
|
|
|
(5,624)
|
|
Proceeds from property
sales
|
4,515
|
|
|
3,680
|
|
Proceeds from
dissolution of AREC
|
—
|
|
|
998
|
|
Insurance and state
collateral (deposits) refunds
|
1,030
|
|
|
652
|
|
Net cash used in
investing activities
|
(19,663)
|
|
|
(36,037)
|
|
|
|
|
|
Financing
activities:
|
|
|
|
Principal repayments of
finance lease obligations
|
(2,336)
|
|
|
(1,697)
|
|
Payment of contingent
consideration liability
|
(111)
|
|
|
—
|
|
Dividends paid on
common stock
|
(4,081)
|
|
|
(3,976)
|
|
Net cash used in
financing activities
|
(6,528)
|
|
|
(5,673)
|
|
|
|
|
|
(Decrease)
Increase in cash and cash equivalents, including restricted
cash
|
(70,190)
|
|
|
5,189
|
|
Cash and cash
equivalents, including restricted cash, at beginning of
period
|
122,255
|
|
|
117,066
|
|
Cash and cash
equivalents, including restricted cash, at end of
period
|
$
|
52,065
|
|
|
$
|
122,255
|
|
ADAMS RESOURCES
& ENERGY, INC. AND SUBSIDIARIES
|
NON-GAAP
RECONCILIATIONS
|
(In thousands,
except per share data)
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
December
31,
|
|
December
31,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Reconciliation of
Adjusted Cash Flow to
|
|
|
|
|
|
|
|
Net
Earnings:
|
|
|
|
|
|
|
|
Net earnings
|
$
|
5,846
|
|
|
$
|
2,653
|
|
|
$
|
995
|
|
|
$
|
8,207
|
|
Add
(subtract):
|
|
|
|
|
|
|
|
Income tax (benefit)
provision
|
(758)
|
|
|
643
|
|
|
(6,530)
|
|
|
2,296
|
|
Depreciation and
amortization
|
4,963
|
|
|
4,375
|
|
|
18,573
|
|
|
16,641
|
|
Gains on sales of
property
|
(874)
|
|
|
(14)
|
|
|
(1,859)
|
|
|
(1,400)
|
|
Gain on dissolution of
AREC
|
—
|
|
|
—
|
|
|
—
|
|
|
(573)
|
|
Stock-based
compensation expense
|
190
|
|
|
126
|
|
|
643
|
|
|
478
|
|
Inventory liquidation
gains
|
(3,229)
|
|
|
(2,290)
|
|
|
—
|
|
|
(3,749)
|
|
Inventory valuation
losses
|
—
|
|
|
—
|
|
|
14,967
|
|
|
—
|
|
Costs of voluntary
early retirement program
|
—
|
|
|
—
|
|
|
431
|
|
|
—
|
|
Net change in fair
value contracts
|
(6)
|
|
|
3
|
|
|
(9)
|
|
|
23
|
|
Adjusted cash
flow
|
$
|
6,132
|
|
|
$
|
5,496
|
|
|
$
|
27,211
|
|
|
$
|
21,923
|
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
December
31,
|
|
December
31,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Adjusted net
earnings and earnings
|
|
|
|
|
|
|
|
per common share
(Non-GAAP):
|
|
|
|
|
|
|
|
Net earnings
|
$
|
5,846
|
|
|
$
|
2,653
|
|
|
$
|
995
|
|
|
$
|
8,207
|
|
Add
(subtract):
|
|
|
|
|
|
|
|
Gain on dissolution of
AREC
|
—
|
|
|
—
|
|
|
—
|
|
|
(573)
|
|
Gains on sales of
property
|
(874)
|
|
|
(14)
|
|
|
(1,859)
|
|
|
(1,400)
|
|
Stock-based
compensation expense
|
190
|
|
|
126
|
|
|
643
|
|
|
478
|
|
Net change in fair
value contracts
|
(6)
|
|
|
3
|
|
|
(9)
|
|
|
23
|
|
Inventory liquidation
gains
|
(3,229)
|
|
|
(2,290)
|
|
|
—
|
|
|
(3,749)
|
|
Inventory valuation
losses
|
—
|
|
|
—
|
|
|
14,967
|
|
|
—
|
|
Costs of voluntary
early retirement program
|
—
|
|
|
—
|
|
|
431
|
|
|
—
|
|
Tax effect of
adjustments to (losses) earnings
|
823
|
|
|
457
|
|
|
(2,976)
|
|
|
1,096
|
|
Adjusted net
earnings
|
$
|
2,750
|
|
|
$
|
935
|
|
|
$
|
12,192
|
|
|
$
|
4,082
|
|
|
|
|
|
|
|
|
|
Adjusted earnings per
common share
|
$
|
0.65
|
|
|
$
|
0.22
|
|
|
$
|
2.87
|
|
|
$
|
0.96
|
|
ADAMS RESOURCES
& ENERGY, INC. AND SUBSIDIARIES
|
NON-GAAP
RECONCILIATIONS
|
(In
thousands)
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Reconciliation of
Adjusted Cash Flow to Net Cash
|
|
|
|
|
|
|
|
|
Provided by (Used
in) Operating Activities:
|
|
|
|
|
|
|
|
|
Net cash provided by
(used in) operating activities
|
|
$
|
6,091
|
|
|
$
|
3,757
|
|
|
$
|
(43,999)
|
|
|
$
|
46,899
|
|
Add
(subtract):
|
|
|
|
|
|
|
|
|
Income tax (benefit)
provision
|
|
(758)
|
|
|
643
|
|
|
(6,530)
|
|
|
2,296
|
|
Deferred income
taxes
|
|
(7,892)
|
|
|
(592)
|
|
|
(6,389)
|
|
|
(2,085)
|
|
Provision for doubtful
accounts
|
|
—
|
|
|
(24)
|
|
|
27
|
|
|
12
|
|
Inventory liquidation
gains
|
|
(3,229)
|
|
|
(2,290)
|
|
|
—
|
|
|
(3,749)
|
|
Inventory valuation
losses
|
|
—
|
|
|
—
|
|
|
14,967
|
|
|
—
|
|
Costs of voluntary
early retirement program
|
|
—
|
|
|
—
|
|
|
431
|
|
|
—
|
|
Changes in assets and
liabilities
|
|
11,920
|
|
|
4,002
|
|
|
68,704
|
|
|
(21,450)
|
|
Adjusted cash
flow
|
|
$
|
6,132
|
|
|
$
|
5,496
|
|
|
$
|
27,211
|
|
|
$
|
21,923
|
|
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SOURCE Adams Resources & Energy, Inc.