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8-K - SMF ENERGY CORP | v211515_8k.htm |
Exhibit
99.1
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200
West Cypress Creek Road, Suite 400
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Fort
Lauderdale, Florida 33309
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NEWS
RELEASE
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Contact:
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Michael
S. Shore
Chief
Financial Officer
954-308-4200
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SMF
ENERGY CORPORATION
REPORTS
QUARTERLY EARNINGS
AND
SCHEDULES CONFERENCE CALL
Ft. Lauderdale,
FL, February 15, 2011 –
SMF ENERGY CORPORATION, (NASDAQ: FUEL) (the “Company”), a leading energy
logistics company providing efficient, just in time distribution of petroleum
products and chemicals, today announced its earnings and results for the three
and six-months ended December 31, 2010.
During
the second quarter of fiscal year 2011, the Company posted net income of
$134,000, operating income of $414,000, and EBITDA of $929,000. These
positive financial results during a seasonally weak period and negative economic
conditions reflect the steady continuation of positive financial performance
since its $40 million recapitalization in June of 2009. The reported
results suggest that the Company’s deleveraged capital structure after the
Recapitalization continues to complement its increased operational efficiency
and the enhanced value from its two prior acquisitions provided by the overhaul
of its entire infrastructure completed in 2008, together yielding operational
and financial support for the Company’s plan to grow organically and by
strategic acquisitions.
The
enhanced infrastructure and improved financial condition permitted the Company
to expand into new markets during fiscal 2010, including locations in South
Carolina and Tennessee. The result has been positive net income for
five of the last six quarters, generating an aggregate of $5.9 million in EBITDA
and net income of $713,000 during those six quarters. During the same
period, shareholders’ equity increased by $695,000, or 11%, and long term debt
declined by $1.5 million, or 25%. The $1.5 million reduction in
principal of long-term debt over the past six quarters includes $250,000 during
the second quarter and $500,000 for the fiscal year. With the pay
down, the Company’s debt to equity ratio was 1.6 at December 31, 2010, versus
1.7 at June 30, 2010. The Company’s fixed charge coverage ratio was
1.38 for the trailing twelve months ended December 31, 2010, compared to a bank
covenant requirement of 1.1, and the trailing twelve months EBITDA exceeded the
trailing twelve months fixed charges by $954,000 at December 31,
2010. During the most recent trailing twelve months ended December
31, 2010, the Company also increased capital expenditures to further improve its
business operations and capture expansion opportunities.
Richard E. Gathright,
Chairman, Chief Executive Officer and President, commented:
“As we
anticipated, the 2008 completion of our ERP and management system and the 2009
Recapitalization were pivotal events in terms of moving us to the next phase of
our growth plan. The Recapitalization strengthened our financial
balance sheet by reducing debt and enhancing shareholders’ equity, allowing us
to concentrate on improving operational performance and growing our business
organically, notwithstanding difficult economic conditions.
That
organic growth has continued in fiscal 2011, as we added new customers and new
locations for existing customers, improving volume by 3% during the first six
months of this fiscal year versus the same period last year. While
this percentage might not appear significant, with our strong margins in recent
years, we typically get a greater bottom-line contribution from each gallon we
add. During the past few months, we have also established some
significant business expansion opportunities from which we expect to realize an
even higher volume growth rate in the foreseeable future. Also, even
though we have yet to recover the 14 percent drop in volumes that occurred in
2008 as our then existing customers’ businesses contracted with the economic
recession, we anticipate that, as these longstanding customers’ businesses
improve in tandem with the economy, our sales to this established customer base
will immediately improve our bottom-line performance.
Supported
by our positive financial performance and improved operating efficiency, we have
re-invigorated our longstanding strategy of seeking growth through acquisitions
and are currently evaluating a number of opportunities. We believe
that we are effectively positioned to take advantage of the opportunities for
synergies presented by our scalable front and back office system and management
structure which was built for a high level of growth, the elimination of
duplicated costs, enhanced operating efficiency and short term
integration. We also believe that the market for mergers and
acquisitions has stabilized during the past few months, allowing buyers and
sellers to more realistically evaluate transactions. In carrying out
our acquisition strategy, however, we are only pursuing acquisitions that
provide accretive yield to our existing shareholders in the short term and that
do not leverage our balance sheet.
We also
continue to seek other ways to enhance shareholder value. During
fiscal 2011, we began a market based stock repurchase
program. Through January 31, 2011, we have purchased a total of
110,576 shares of our common stock for approximately $166,000. We are
authorized to purchase up to $840,000 of capital stock. We plan to
continue making purchases during the balance of the third quarter of fiscal
2011, subject to our bank covenants and limitations under applicable securities
regulations, as we continue to believe that the cost of acquiring shares of our
common stock at current prices is a reasonable and prudent allocation of our
financial resources. In addition, we will continue our proactive
efforts to introduce the Company’s story and opportunity to potential investors
and investor groups. While we appreciate the recent increase in the
trading prices of our stock, we continue to believe that the value of the
Company is not recognized by the markets.”
2
Highlights of Second Quarter
Fiscal Year 2011 vs. Second Quarter Fiscal Year 2010
·
|
Revenues
were $52.6 million in the second quarter of fiscal year 2011 as compared
to $46.3 million in the same period of the prior year, an increase of $6.3
million, or 14%. Variances in market prices of petroleum
products provided $6.1 million of the increase in revenues. The
$200,000 remainder of the increase is due to a 69,000 increase in gallons
sold compared to a year ago, a 4% increase in volume for the
quarter.
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·
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Net
income was $134,000 in the second quarter of fiscal year 2011, compared to
$445,000 in the same period of the prior year. The $311,000, or
70%, decrease was largely attributable to last year’s litigation
settlement by which we recovered some of our expended legal and
professional fees, thereby lowering our SG&A costs during the second
quarter last year by approximately $748,000. The year-to-year
difference was partially offset by a higher gross profit this year of
$407,000, primarily due to lower direct costs as we reduced employee,
travel and running equipment costs.
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·
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EBITDA
(a non-GAAP measure) was $929,000 in the second quarter of fiscal 2011
compared to $1.3 million in the same period of the prior year, a decrease
of approximately $360,000, or 28%. The decrease was
primarily attributed to last year’s $748,000 litigation settlement
recovery, as discussed above, again partially offset by $407,000 in higher
gross profit this fiscal year.
|
Highlights of First Six
Months of Fiscal Year 2011 vs. First Six Months of Fiscal Year
2010
·
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Revenues
were $103.6 million in the six months ended December 31, 2010, as compared
to $90.0 million in the same period of the prior year, an increase of
$13.6 million, or 15%. Price variances due to higher market
prices of petroleum products during the first six months of fiscal 2011
resulted in an increase of $10.5 million in revenues. The
increases in revenues were also partially due to an increase of
approximately 1.0 million gallons sold, which resulted in an increase of
approximately $3.1 million in revenues compared to the same period in the
prior year, reflecting the expansion of our business from new and existing
customers.
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·
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Net
income was $248,000 in the six months ended December 31, 2010, as compared
to a net income of $465,000 in the same period in the prior
year. The $217,000, or 47%, decrease was partially attributable
to a $354,000 increase in SG&A, which increase was primarily the
result of last year’s net reduction of SG&A from the litigation
settlement referenced above, reducing SG&A costs last year by
approximately $587,000, partially offset by $187,000 of unamortized
acquisition costs that we incurred last year as a result of the adoption
of ASC 805. Offsetting this increase in SG&A was a higher
gross profit this year of $148,000 reflecting the expansion of our
business.
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·
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EBITDA
was $1.9 million in the six months ended December 31, 2010, as compared to
$2.4 million in the same period of the prior year, a decrease of
approximately $500,000. The decrease in EBITDA was primarily
due to last year’s litigation settlement recovery, which lowered our
SG&A costs last year by approximately $587,000, which was partially
offset by a higher gross profit this year of $148,000 due to the expansion
of our business.
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3
Selected Income Statement
and Financial Data
The
following tables present comparative financial data for the periods
noted:
All
amounts in thousands of dollars, except price per share and net margin per
gallon, shares outstanding and gallons sold
For
the Three Months
|
For
the Six Months
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|||||||||||||||
Ended
December 31,
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Ended
December 31,
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|||||||||||||||
2010
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2009
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2010
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2009
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|||||||||||||
Petroleum
product sales and service revenues
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$ | 46,608 | $ | 40,458 | $ | 91,665 | $ | 78,583 | ||||||||
Petroleum
product taxes
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5,956 | 5,847 | 11,960 | 11,408 | ||||||||||||
Total
revenues
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52,564 | 46,305 | 103,625 | 89,991 | ||||||||||||
Cost
of petroleum product sales and service
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42,820 | 37,077 | 84,039 | 71,105 | ||||||||||||
Petroleum
product taxes
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5,956 | 5,847 | 11,960 | 11,408 | ||||||||||||
Total
cost of sales
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48,776 | 42,924 | 95,999 | 82,513 | ||||||||||||
Gross
profit
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3,788 | 3,381 | 7,626 | 7,478 | ||||||||||||
Selling,
general and administrative expenses
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3,374 | 2,673 | 6,866 | 6,512 | ||||||||||||
Operating
income
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414 | 708 | 760 | 966 | ||||||||||||
Interest
expense
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(232 | ) | (261 | ) | (455 | ) | (491 | ) | ||||||||
Interest
and other income
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10 | 6 | 12 | 6 | ||||||||||||
Income
before income taxes
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192 | 453 | 317 | 481 | ||||||||||||
Income
tax expense
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(58 | ) | (8 | ) | (69 | ) | (16 | ) | ||||||||
Net
income
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$ | 134 | $ | 445 | $ | 248 | $ | 465 | ||||||||
Basic
and diluted net income per share computation:
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||||||||||||||||
Net
income per share attributable to
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||||||||||||||||
Common
shareholders:
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||||||||||||||||
Basic
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$ | 0.02 | $ | 0.05 | $ | 0.03 | $ | 0.06 | ||||||||
Diluted
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$ | 0.02 | $ | 0.05 | $ | 0.03 | $ | 0.05 | ||||||||
Weighted
average common shares outstanding:
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||||||||||||||||
Basic
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8,505 | 8,557 | 8,527 | 8,404 | ||||||||||||
Diluted
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8,640 | 8,781 | 8,661 | 8,692 | ||||||||||||
EBITDA
(non-GAAP measure)1
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$ | 929 | $ | 1,289 | $ | 1,882 | $ | 2,423 | ||||||||
Gallons
sold
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17,025 | 16,956 | 34,937 | 33,901 | ||||||||||||
Net
margin
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$ | 3,969 | $ | 3,609 | $ | 8,072 | $ | 7,942 | ||||||||
Net
margin per gallon2
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$ | 0.23 | $ | 0.21 | $ | 0.23 | $ | 0.23 |
1 Non-GAAP
measure. See “Non-GAAP Measures and Definitions” below.
2 See
“Non-GAAP Measures and Definitions” below.
4
Condensed Consolidated
Balance Sheet
All
amounts in thousands of dollars
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||||||||
December
31,
2010
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June
30,
2010
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|||||||
ASSETS
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||||||||
Current
assets
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$ | 19,952 | $ | 20,033 | ||||
Property,
plant and equipment, net
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7,141 | 7,226 | ||||||
Other
assets, net
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2,116 | 2,319 | ||||||
Total
assets
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$ | 29,209 | $ | 29,578 | ||||
LIABILITIES
AND SHAREHOLDERS’ EQUITY
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||||||||
Current
liabilities
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$ | 18,089 | $ | 18,388 | ||||
Long-term
debt, net and other liabilities
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3,896 | 4,134 | ||||||
Stockholders’
equity
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7,224 | 7,056 | ||||||
Total
liabilities and shareholders’ equity
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$ | 29,209 | $ | 29,578 |
Highlights of Results for
Quarterly Periods ending December 31, 2010 thru March 31,
2009
The
following table portrays the financial trends for the Company’s eight most
recent quarters:
All
amounts in thousands of dollars, except net margin per gallon
December
31,
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September
30,
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June
30,
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March
31,
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December
31,
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September
30,
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June
30,
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March
31,
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|||||||||||||||||||||||||
2010
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2010
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2010
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2010
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2009
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2009
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2009
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2009
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|||||||||||||||||||||||||
Revenues
|
$ | 52,564 | $ | 51,061 | $ | 53,704 | $ | 49,152 | $ | 46,305 | $ | 43,686 | $ | 39,884 | $ | 34,982 | ||||||||||||||||
Gross
profit
|
$ | 3,788 | $ | 3,838 | $ | 4,320 | $ | 3,398 | $ | 3,381 | $ | 4,097 | $ | 3,539 | $ | 3,790 | ||||||||||||||||
Selling,
general and
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||||||||||||||||||||||||||||||||
administrative
|
$ | 3,374 | $ | 3,492 | $ | 3,678 | $ | 3,555 | $ | 2,673 | $ | 3,839 | $ | 3,401 | $ | 3,455 | ||||||||||||||||
Operating
income (loss)
|
$ | 414 | $ | 346 | $ | 642 | $ | (157 | ) | $ | 708 | $ | 258 | $ | 138 | $ | 335 | |||||||||||||||
Interest
expense and
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||||||||||||||||||||||||||||||||
other
income, net
|
$ | (222 | ) | $ | (221 | ) | $ | (215 | ) | $ | (254 | ) | $ | (255 | ) | $ | (230 | ) | $ | (454 | ) | $ | (570 | ) | ||||||||
Non-cash
ASC 470-20
|
||||||||||||||||||||||||||||||||
(formerly
FAS No. 84)
|
||||||||||||||||||||||||||||||||
inducement
on extinguishment 2
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$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | (1,651 | ) | $ | - | |||||||||||||||
Gain
on extinguishment
|
||||||||||||||||||||||||||||||||
of
promissory notes
|
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | 27 | $ | - | ||||||||||||||||
Net
income (loss)
|
$ | 134 | $ | 114 | $ | 419 | $ | (419 | ) | $ | 445 | $ | 20 | $ | (1,948 | ) | $ | (243 | ) | |||||||||||||
Less: Non-cash
write-off of
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||||||||||||||||||||||||||||||||
unamortized
acquisition costs
|
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 187 | $ | - | $ | - | ||||||||||||||||
Less: Non-cash
stock options
|
||||||||||||||||||||||||||||||||
repricing
costs
|
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 93 | $ | - | $ | - | ||||||||||||||||
Less: Non-cash
ASC 470-20
|
||||||||||||||||||||||||||||||||
(formerly
FAS No. 84)
|
||||||||||||||||||||||||||||||||
inducement
on extinguishment 1
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$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | 1,651 | $ | - | ||||||||||||||||
Adjusted
net income (loss)
|
||||||||||||||||||||||||||||||||
before
non-cash, non-recurring
|
||||||||||||||||||||||||||||||||
charges
1
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$ | 134 | $ | 114 | $ | 419 | $ | (419 | ) | $ | 445 | $ | 300 | $ | (297 | ) | $ | (243 | ) | |||||||||||||
EBITDA
1
|
$ | 929 | $ | 953 | $ | 1,189 | $ | 398 | $ | 1,289 | $ | 1,134 | $ | 876 | $ | 974 | ||||||||||||||||
Net
margin
|
$ | 3,969 | $ | 4,103 | $ | 4,529 | $ | 3,616 | $ | 3,609 | $ | 4,333 | $ | 3,795 | $ | 4,027 | ||||||||||||||||
Net
margin per gallon 1
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$ | 0.23 | $ | 0.23 | $ | 0.25 | $ | 0.21 | $ | 0.21 | $ | 0.26 | $ | 0.23 | $ | 0.25 | ||||||||||||||||
Gallons
sold
|
17,025 | 17,912 | 18,385 | 17,382 | 16,956 | 16,945 | 16,709 | 16,041 |
1 Non-GAAP
measure. See “Non-GAAP Measures and Definitions” below.
2 See
“Non-GAAP Measures and Definitions” below.
5
Non-GAAP Measures and
Definitions
EBITDA. EBITDA
is defined as earnings before interest, taxes, depreciation, and amortization, a
non-GAAP financial measure within the meaning of Regulation G promulgated by the
Securities and Exchange Commission. We believe that EBITDA provides
useful information to investors because it excludes transactions not related to
the core cash operating business activities, allowing meaningful analysis of the
performance of our core cash operations. To the extent that gain and
the non-cash ASC 470-20 (formerly FAS No. 84) inducement on extinguishment of
promissory notes constitutes the recognition of previously deferred
interest or finance cost, it is considered interest expense for the calculation
of certain interest expense amounts. Both stock-based compensation
amortization expense and the write-off of unamortized acquisition costs are
considered amortization items to be excluded in the EBITDA
calculation.
Reconciliation
of EBITDA to the Net income (loss) (non-GAAP measure)
For
Quarterly periods ending December 31, 2010 thru March 31, 2009
All
amounts in thousands of dollars
December
31,
|
September
30,
|
June
30,
|
March
31,
|
December
31,
|
September
30,
|
June
30,
|
March
31,
|
|||||||||||||||||||||||||
2010
|
2010
|
2010
|
2010
|
2009
|
2009
|
2009
|
2009
|
|||||||||||||||||||||||||
Net
income (loss)
|
$ | 134 | $ | 114 | $ | 419 | $ | (419 | ) | $ | 445 | $ | 20 | $ | (1,948 | ) | $ | (243 | ) | |||||||||||||
Add
back:
|
||||||||||||||||||||||||||||||||
Interest
expense
|
232 | 223 | 227 | 260 | 261 | 230 | 545 | 575 | ||||||||||||||||||||||||
Income
tax expense
|
58 | 11 | 8 | 8 | 8 | 8 | 8 | 8 | ||||||||||||||||||||||||
Depreciation and
amortization
|
||||||||||||||||||||||||||||||||
expense
within:
|
||||||||||||||||||||||||||||||||
Cost
of sales
|
180 | 266 | 208 | 218 | 228 | 236 | 254 | 239 | ||||||||||||||||||||||||
Selling,
general and
|
||||||||||||||||||||||||||||||||
administrative
expenses
|
276 | 318 | 316 | 316 | 316 | 320 | 344 | 334 | ||||||||||||||||||||||||
Stock-based
compensation expense
|
49 | 21 | 11 | 15 | 31 | 133 | 49 | 61 | ||||||||||||||||||||||||
Write-off
of unamortized
|
||||||||||||||||||||||||||||||||
Acquisition
costs
|
- | - | - | - | - | 187 | - | - | ||||||||||||||||||||||||
Non-cash
ASC 470-20
|
||||||||||||||||||||||||||||||||
(formerly
FAS No. 84)
|
||||||||||||||||||||||||||||||||
inducement
on extinguishment
|
- | - | - | - | - | - | 1,651 | - | ||||||||||||||||||||||||
Gain
on extinguishment
|
||||||||||||||||||||||||||||||||
of
promissory notes
|
- | - | - | - | - | - | (27 | ) | - | |||||||||||||||||||||||
EBITDA
|
$ | 929 | $ | 953 | $ | 1,189 | $ | 398 | $ | 1,289 | $ | 1,134 | $ | 876 | $ | 974 |
Adjusted Net
Income (Loss). Adjusted net income (loss) before non-cash,
non-recurring charges is a non-GAAP measure that demonstrates the economic
performance of the Company before the impact of charges that do not reflect the
ongoing performance of its operations, such as the non-cash accounting charge of
$1.7 million in the fourth quarter of fiscal 2009 resulting from the Company’s
June 2009 recapitalization, non cash stock option repricing costs and the
write-off incurred in the first quarter of fiscal 2010 resulting from the
application of a new accounting ruling. We believe that this non-GAAP
measure, like EBITDA, is a meaningful representation of the ongoing performance
of the operations.
6
The
following table reconciles Adjusted net income (loss) before non-cash,
non-recurring charges (non-GAAP measure) to the reported Net income (loss) for
each of the eight quarterly periods presented above (in thousands):
December
31,
|
September
30,
|
June
30,
|
March
31,
|
December
31,
|
September
30,
|
June
30,
|
March
31,
|
|||||||||||||||||||||||||
2010
|
2010
|
2010
|
2010
|
2009
|
2009
|
2009
|
2009
|
|||||||||||||||||||||||||
Net
income (loss)
|
$ | 134 | $ | 114 | $ | 419 | $ | (419 | ) | $ | 445 | $ | 20 | $ | (1,948 | ) | $ | (243 | ) | |||||||||||||
Less: Non-cash
write-off of
|
||||||||||||||||||||||||||||||||
unamortized
acquisition costs
|
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 187 | $ | - | $ | - | ||||||||||||||||
Less: Non-cash
stock options
|
||||||||||||||||||||||||||||||||
repricing
costs
|
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 93 | $ | - | $ | - | ||||||||||||||||
Less: Non-cash
ASC 470-20
|
||||||||||||||||||||||||||||||||
(formerly
FAS No. 84)
|
||||||||||||||||||||||||||||||||
inducement
on extinguishment
|
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | 1,651 | $ | - | ||||||||||||||||
Adjusted
net income (loss)
|
||||||||||||||||||||||||||||||||
before
non-cash, non-recurring
|
||||||||||||||||||||||||||||||||
charges
|
$ | 134 | $ | 114 | $ | 419 | $ | (419 | ) | $ | 445 | $ | 300 | $ | (297 | ) | $ | (243 | ) |
Fixed Charges
Coverage Ratio. Fixed charges and the fixed charges coverage
ratio are non-GAAP measures that are used by our principal lender and others to
help assess the Company’s ability to satisfy cash payments other than those made
for operating activities. Fixed charges are comprised of repayments
of principal on debt, purchases of property and equipment, cash paid for
interest, payments for dividends and repurchases of stock. The fixed
charge coverage ratio generally measures the extent to which EBITDA exceeds the
cash requirements, or fixed charges, of the business. These
measurements are typically made on a rolling trailing twelve month
basis.
7
The
following table reconciles fixed charges and the fixed charges coverage ratio
(non-GAAP measures) to the Net income (loss) for the trailing twelve months
ended December 31, 2010 (in thousands):
Trailing
Twelve Months
|
||||
Ended
December 31, 2010
|
||||
Net
income (loss)
|
$ | 248 | ||
Add
back:
|
||||
Interest
expense
|
942 | |||
Income
tax expense
|
85 | |||
Depreciation
and amortization expense within:
|
||||
Cost
of sales
|
872 | |||
Selling,
general and administrative expenses
|
1,226 | |||
Stock-based
compensation amortization expense
|
96 | |||
Write-off
of unamortized acquisition costs
|
- | |||
Non-cash
ASC 470-20 (formerly FAS No. 84) inducement on
|
||||
extinguishment
|
- | |||
Gain
on extinguishment of promissory notes
|
- | |||
EBITDA
|
$ | 3,469 | ||
Less
fixed charges:
|
||||
Principal
payments on term and promissory notes
|
1,000 | |||
Purchases
of property and equipment
|
465 | |||
Capital
lease payments
|
61 | |||
Cash
paid for interest
|
785 | |||
Payment
of preferred stock dividends
|
13 | |||
Principal
and interest payments made as a result of the
Recapitalization
|
- | |||
Repurchase
of common shares
|
140 | |||
Cash
paid for income tax
|
51 | |||
Total
fixed charges
|
$ | 2,515 | ||
Difference
(EBITDA less fixed charges)
|
$ | 954 | ||
Fixed
charge coverage ratio (EBITDA divided by fixed charges)
|
1.38 |
Non-cash
ASC 470-20 inducement on extinguishment is a non-cash charge we incurred as a
result of the June 29, 2009 Recapitalization. The Company
extinguished a portion of the August 2007 and the September 2008 Notes (“the
Notes”) through the issuance of approximate 1.2 million shares and approximate
278,000 shares, respectively, at the negotiated price of $1.71 per share, which
was greater than the $1.67 per share closing bid price the day prior to the
Recapitalization, but lower than the conversion price applicable to the
convertible debt instruments, which resulted in the issuance of more shares in
the exchange than would have been issued upon a conversion. The
prevalent interpretation of ASC 470-20 is that an inducement occurs any time
when additional shares are issued in the extinguishment of convertible debt
regardless of the absence of an economic loss or economic intent of the parties
to the transaction. As a result, irrespective of the economic reality
of the transaction, ASC 470-20 required the recording of a non-cash “conversion
inducement” charge of $1.7 million, based on the difference between the
approximate aggregate 471,000 common shares issuable to the applicable note
holder under the original conversion rights that existed upon a conversion and
the approximate 1.5 million common shares exchanged at $1.71 cents in the
transaction that extinguished all of the Notes. This non-cash charge
is deemed a financing expense to extinguish the Notes. To the extent
that the ASC 470-20 inducement on extinguishment of promissory notes constitutes
the recognition of a finance cost, it is considered interest expense for
the calculation of EBITDA and other interest expense amounts.
8
Net Margin Per
Gallon. Net margin per gallon is one of the most important
measures of our financial performance. It is calculated by adding
gross profit to the cost of sales depreciation and amortization and dividing
that sum by the number of gallons sold.
CONFERENCE
CALL
Management
will host a conference call on Tuesday, February 15, 2011, at 4:15 P.M. Eastern
Time (“ET”) to further discuss the results of the Company’s three and six months
ended December 31, 2010. Interested parties can listen to the call
live on the Internet through the Company’s Web site at www.mobilefueling.com
or by dialing 800-259-0251
(domestic) or 617-614-3671 (international),
using Pass Code
98668137. Listeners should dial in to the call at least 5-10
minutes prior to the start of the call or should go to the Web site at least 15
minutes prior to the call to download and install any necessary audio
software. The Web cast is also available through Thomson’s investor
portals. Individual investors can listen to the call at www.earnings.com,
Thomson/CCBN's individual investor portal, powered by
StreetEvents. Institutional investors can access the call via
Thomson's password-protected event management site, StreetEvents (www.streetevents.com). A
telephone replay of the conference call will be available from February 15,
2011, at 7:15 P.M. ET until midnight ET on February 22, 2011, by dialing 888-286-8010 (domestic) or
617-801-6888
(international), using Pass Code
58251529. A web archive will be available for 30 days at www.mobilefueling.com.
ABOUT SMF ENERGY CORPORATION
(NASDAQ: FUEL)
The
Company is a leading provider of petroleum product distribution services,
transportation logistics and emergency response services to the trucking, manufacturing,
construction, shipping, utility, energy, chemical, telecommunications and government services
industries. The Company provides its services and products
through 34 locations in the
eleven states of Alabama, California, Florida, Georgia, Louisiana, Nevada,
Mississippi, North Carolina, South Carolina, Tennessee and Texas. The
broad range of services
the Company offers its customers includes commercial mobile and bulk fueling;
the packaging, distribution and sale of lubricants and chemicals; integrated
out-sourced fuel management; transportation logistics and emergency response
services. The Company’s fleet of custom specialized tank wagons,
tractor-trailer transports, box trucks and customized flatbed vehicles
delivers diesel fuel and gasoline to customers’ locations on a regularly
scheduled or as needed basis, refueling vehicles and equipment, re-supplying
fixed-site and
temporary bulk storage tanks, and emergency power generation systems; and
distributes a wide variety of specialized petroleum products, lubricants and
chemicals to our customers. More information on the Company is
available at www.mobilefueling.com.
9
FORWARD LOOKING
STATEMENTS
This
press release includes “forward-looking statements” within the meaning of the
safe harbor provision of the Private Securities Litigation Reform Act of
1995. For example, predictions or statements of belief or expectation
concerning the future performance of the Company, the future trading prices of
the Company’s common stock and the potential for further growth of the Company
are all “forward looking statements” which should not be relied
upon. Such forward-looking statements are based on the current
beliefs of the Company and its management based on information known to them at
this time. Because these statements depend on various assumptions as
to future events, they should not be relied on by shareholders or other persons
in evaluating the Company. Although management believes that the
assumptions reflected in such forward-looking statements are reasonable, actual
results could differ materially from those projected. In addition,
there are numerous risks and uncertainties that could cause actual results to
differ from those anticipated by the Company, including but not limited to those
cited in the “Risk Factors” section of the Company’s Form 10-K for the year
ended June 30, 2010.
10