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| 8-K - WORLD FUEL SERVICES CORPORATION 8-K - WORLD FUEL SERVICES CORP | a6707694.htm |
Exhibit 99.1
World Fuel Services Corporation Reports Record Quarterly Results
-- Net Income Increases 22% Year-Over-Year --
MIAMI--(BUSINESS WIRE)--May 3, 2011--World Fuel Services Corporation (NYSE: INT), a leading fuel logistics company, principally engaged in the marketing, sale and distribution of aviation, marine and land fuel products and related services, today reported first quarter net income of $41.1 million or $0.58 diluted earnings per share compared to $33.7 million or $0.56 diluted earnings per share in the first quarter of 2010. Non-GAAP net income for the first quarter, which excludes share-based compensation and amortization of acquired intangible assets, was $46.8 million or $0.66 non-GAAP diluted earnings per share compared to $36.2 million or $0.60 non-GAAP diluted earnings per share in the first quarter of 2010.
The company’s aviation segment generated gross profit of $70.1 million in the first quarter of 2011, an increase of $12.1 million or 21% sequentially, and an increase of $21.8 million or 45% year-over-year. The marine segment generated gross profit of $40.2 million, a decrease of $1.3 million or 3% sequentially, but an increase of $800 thousand or 2% from last year’s results. The company’s land segment posted gross profit of $26.4 million in the first quarter, an increase of $2.4 million or 10% sequentially, and $15.4 million or 139% year-over-year.
“During the quarter, we continued to demonstrate our ability to leverage our risk management disciplines, while profitably growing the business,” said Paul H. Stebbins, chairman and chief executive officer of World Fuel Services Corporation. “We are pleased with our strong results in what continues to be a very challenging operating environment.”
“We closed and integrated the NCS acquisition during the quarter, which will allow us to leverage our existing business activities in the fuel logistics marketplace,” stated Michael J. Kasbar, president and chief operating officer. “We have also recently completed the acquisition of Ascent, which combined with the other recent acquisitions and core business, strengthens our leadership position in the general and business aviation space.”
Non-GAAP Financial Measures
This press release includes selected financial information that has not been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). This information includes non-GAAP net income and non-GAAP diluted earnings per share. The non-GAAP financial measures exclude costs associated with share-based compensation and amortization of acquired intangible assets, primarily because we do not believe they are reflective of the company’s core operating results. We believe that these non-GAAP financial measures, when considered in conjunction with our financial information prepared in accordance with GAAP, are useful for investors to evaluate our core operating results and trends.
Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. In addition, our presentation of non-GAAP net income and non-GAAP diluted earnings per share may not be comparable to the presentation of such metrics by other companies. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measure. A reconciliation of GAAP to non-GAAP results has been provided in the financial statement tables included in this press release.
Information Relating to Forward-Looking Statements
With the exception of historical information in this news release, this document includes forward-looking statements that involve risks and uncertainties, including, but not limited to, quarterly fluctuations in results, the creditworthiness of customers and counterparties and our ability to collect accounts receivable, fluctuations in world oil prices or foreign currency, changes in political, economic, regulatory, or environmental conditions, adverse conditions in the markets or industries in which we or our customers operate, our failure to effectively hedge certain financial risks associated with the use of derivatives, non-performance by counterparties or customers on derivatives contracts, the integration of acquired businesses, uninsured losses, our ability to retain and attract senior management and other key employees and other risks detailed from time to time in the Company’s Securities and Exchange Commission filings. Actual results may differ materially from any forward-looking statements set forth herein.
About World Fuel Services Corporation
Headquartered in Miami, Florida, World Fuel Services is a leading global fuel logistics company, principally engaged in the marketing, sale and distribution of aviation, marine and land fuel products and related services on a worldwide basis. World Fuel Services sells fuel and delivers services to its clients at more than 6,000 locations in 200 countries and territories, including airports, seaports, tanker truck loading terminals and other customer storage locations. With 48 strategically located global offices, World Fuel Services offers its clients a value-added outsource service for the supply, quality control, logistical support and price risk management of marine, aviation and land fuel.
The Company's global team of market makers provides deep domain expertise in all aspects of marine, aviation and land fuel management. Aviation customers include commercial airlines, cargo carriers, private aircraft and fixed base operators (FBO’s), as well as the United States and foreign governments. World Fuel Services' marine customers include international container and tanker fleets, cruise lines and time-charter operators, as well as the United States and foreign governments. Land customers include petroleum distributors, retail petroleum operators, and industrial, commercial and government accounts. For more information, call 305-428-8000 or visit www.wfscorp.com.
| WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES | |||||||||||
| CONSOLIDATED STATEMENTS OF INCOME | |||||||||||
| (UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE DATA) | |||||||||||
| For the Three Months ended | |||||||||||
| March 31, | |||||||||||
| 2011 | 2010 | ||||||||||
| Revenue | $ | 7,079,406 | $ | 3,918,021 | |||||||
| Cost of revenue | 6,942,638 | 3,819,203 | |||||||||
| Gross profit | 136,768 | 98,818 | |||||||||
| Operating expenses: | |||||||||||
| Compensation and employee benefits | 47,069 | 34,801 | |||||||||
| Provision for bad debt | 796 | 369 | |||||||||
| General and administrative | 33,378 | 21,523 | |||||||||
| Total operating expenses | 81,243 | 56,693 | |||||||||
| Income from operations | 55,525 | 42,125 | |||||||||
| Non-operating expenses, net | (3,453 | ) | (604 | ) | |||||||
| Income before income taxes | 52,072 | 41,521 | |||||||||
| Provision for income taxes | 10,415 | 7,681 | |||||||||
| Net income including noncontrolling interest | 41,657 | 33,840 | |||||||||
| Net income attributable to noncontrolling interest | 548 | 137 | |||||||||
| Net income attributable to World Fuel | $ | 41,109 | $ | 33,703 | |||||||
| Basic earnings per share | $ | 0.59 | $ | 0.57 | |||||||
| Basic weighted average common shares | 69,970 | 59,324 | |||||||||
| Diluted earnings per share | $ | 0.58 | $ | 0.56 | |||||||
| Diluted weighted average common shares | 70,982 | 60,601 | |||||||||
| WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES | ||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||
| (UNAUDITED - IN THOUSANDS) | ||||||||||
| As of | ||||||||||
| March 31, | December 31, | |||||||||
| 2011 | 2010 | |||||||||
| Assets: | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 93,374 | $ | 272,893 | ||||||
| Accounts receivable, net | 1,892,307 | 1,386,700 | ||||||||
| Inventories | 312,379 | 211,526 | ||||||||
| Prepaid expenses and other current assets | 213,226 | 196,748 | ||||||||
| Total current assets | 2,511,286 | 2,067,867 | ||||||||
| Property and equipment, net | 64,899 | 64,106 | ||||||||
| Goodwill, identifiable intangible and non-current other assets | 461,598 | 434,477 | ||||||||
| Total assets | $ | 3,037,783 | $ | 2,566,450 | ||||||
| Liabilities and equity: | ||||||||||
| Liabilities: | ||||||||||
| Current liabilities: | ||||||||||
| Short-term debt | $ | 17,401 | $ | 17,076 | ||||||
| Accounts payable | 1,488,592 | 1,131,228 | ||||||||
| Accrued expenses and other current liabilities | 213,103 | 210,180 | ||||||||
| Total current liabilities | 1,719,096 | 1,358,484 | ||||||||
| Long-term debt | 64,133 | 24,566 | ||||||||
| Other long-term liabilities | 59,787 | 56,836 | ||||||||
| Total liabilities | 1,843,016 | 1,439,886 | ||||||||
| Equity: | ||||||||||
| World Fuel shareholders' equity | 1,194,084 | 1,127,208 | ||||||||
| Noncontrolling interest equity (deficit) | 683 | (644 | ) | |||||||
| Total equity | 1,194,767 | 1,126,564 | ||||||||
| Total liabilities and equity | $ | 3,037,783 | $ | 2,566,450 | ||||||
| WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| (UNAUDITED - IN THOUSANDS) | ||||||||||||||
| For the Three Months ended | ||||||||||||||
| March 31, | ||||||||||||||
| 2011 | 2010 | |||||||||||||
| Cash flows from operating activities: | ||||||||||||||
| Net income including noncontrolling interest | $ | 41,657 | $ | 33,840 | ||||||||||
| Adjustments to reconcile net income including | ||||||||||||||
| noncontrolling interest to net cash (used in) | ||||||||||||||
| provided by operating activities: | ||||||||||||||
| Depreciation and amortization | 8,167 | 4,419 | ||||||||||||
| Provision for bad debt | 796 | 369 | ||||||||||||
| Share-based payment award compensation costs | 2,865 | 1,306 | ||||||||||||
| Other | (249 | ) | (1,185 | ) | ||||||||||
| Changes in assets and liabilities, net of acquisitions | (197,722 | ) | (22,183 | ) | ||||||||||
| Total adjustments | (186,143 | ) | (17,274 | ) | ||||||||||
| Net cash (used in) provided by operating activities | (144,486 | ) | 16,566 | |||||||||||
| Cash flows from investing activities: | ||||||||||||||
| Acquisition of businesses, net of cash acquired | (67,000 | ) | (8,315 | ) | ||||||||||
| Other | (2,628 | ) | (891 | ) | ||||||||||
| Net cash used in investing activities | (69,628 | ) | (9,206 | ) | ||||||||||
| Cash flows from financing activities: | ||||||||||||||
| Borrowings under revolving credit facility, net | 40,000 | - | ||||||||||||
| Other | (6,562 | ) | (2,097 | ) | ||||||||||
| Net cash provided by (used in) financing activities | 33,438 | (2,097 | ) | |||||||||||
| Effect of exchange rate changes on cash and | ||||||||||||||
| cash equivalents | 1,157 | (1,026 | ) | |||||||||||
| Net (decrease) increase in cash and cash equivalents | (179,519 | ) | 4,237 | |||||||||||
| Cash and cash equivalents, at beginning of period | 272,893 | 298,843 | ||||||||||||
| Cash and cash equivalents, at end of period | $ | 93,374 | $ | 303,080 | ||||||||||
| WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES | |||||||||
| RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES | |||||||||
| (UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE DATA) | |||||||||
| For the Three Months ended | |||||||||
| March 31, | |||||||||
| 2011 | 2010 | ||||||||
| GAAP net income attributable to World Fuel | $ | 41,109 | $ | 33,703 | |||||
| Share-based compensation expense, net of taxes | 2,009 | 1,003 | |||||||
| Intangible asset amortization expense, net of taxes | 3,662 | 1,494 | |||||||
| Non-GAAP net income attributable to World Fuel | $ | 46,780 | $ | 36,200 | |||||
| GAAP diluted earnings per share | $ | 0.58 | $ | 0.56 | |||||
| Share-based compensation expense, net of taxes | 0.03 | 0.02 | |||||||
| Intangible asset amortization expense, net of taxes | 0.05 | 0.02 | |||||||
| Non-GAAP diluted earnings per share | $ | 0.66 | $ | 0.60 | |||||
| WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES | |||||||||
| BUSINESS SEGMENT INFORMATION | |||||||||
| (UNAUDITED - IN THOUSANDS) | |||||||||
| For the Three Months ended | |||||||||
| March 31, | |||||||||
| 2011 | 2010 | ||||||||
| Revenue: | |||||||||
| Aviation segment | $ | 2,646,592 | $ | 1,459,724 | |||||
| Marine segment | 2,999,419 | 2,098,612 | |||||||
| Land segment | 1,433,395 | 359,685 | |||||||
| $ | 7,079,406 | $ | 3,918,021 | ||||||
| Gross profit: | |||||||||
| Aviation segment | $ | 70,128 | $ | 48,375 | |||||
| Marine segment | 40,215 | 39,389 | |||||||
| Land segment | 26,425 | 11,054 | |||||||
| $ | 136,768 | $ | 98,818 | ||||||
| Income from operations: | |||||||||
| Aviation segment | $ | 38,170 | $ | 26,694 | |||||
| Marine segment | 17,355 | 20,007 | |||||||
| Land segment | 10,663 | 2,348 | |||||||
| 66,188 | 49,049 | ||||||||
| Corporate overhead | 10,663 | 6,924 | |||||||
| $ | 55,525 | $ | 42,125 | ||||||
CONTACT:
World Fuel Services Corporation
Ira M. Birns, 305-428-8000
Executive
Vice President & Chief Financial Officer
or
Francis X. Shea,
305-428-8000
Executive Vice President & Chief Risk and Administrative
Officer