FT. LAUDERDALE, Florida,
November 14, 2011 /PRNewswire/ --
- CONFERENCE CALL SCHEDULED FOR
NOVEMBER 16, 2011
SMF ENERGY CORPORATION, (NASDAQ: FUEL) (the "Company"), a
leading energy logistics service company providing efficient, just
in time distribution of petroleum products and chemicals, today
announced its earnings and results for the first quarter ended
September 30, 2011.
(Logo:
http://photos.prnewswire.com/prnh/20090513/SMFENERGYCORPLOGO)
For the quarter ended September 30,
2011, the Company reported net income of $820,000 or $0.10
per share, operating income of $1.1
million, and EBITDA(1), a non-GAAP measure, of $1.6 million.
The Company also confirmed that, as previously announced, its
Board of Directors declared, on October 3,
2011, a quarterly cash dividend of $0.015 per share payable to holders of record of
the Company's common stock at the close of business on November 14, 2011, to be paid on December 2, 2011.
Richard E. Gathright,
Chairman, Chief Executive Officer and President, commented:
"We are extremely pleased with our continued strong bottom line
performance in the first quarter of fiscal 2012, which is a
significant $700,000 improvement over
the earnings posted in the first quarter of the last fiscal year.
The focus of our management team continues to be on our core,
fundamental business operations and the use of our integrated
systems which for this quarter has yielded net income of
10 cents per share. This underscores
the previously announced 20% increase in our quarterly dividend to
1.5 cents per share for the quarter
ended September 30, 2011.
"On September 27, 2011, we amended
our credit facility with Wells Fargo, N.A. to provide for a new
five year term, significantly lower interest rates, an increase in
our line of credit to $25 million,
and other improvements, as previously detailed in our Form 10-K.
The amendment of our credit facility, the continued annual 20% per
year pay-down of our bank term loan to an outstanding balance at
September 30, 2011 of $2.8 million, the reduction of our 'days sales
outstanding' receivables collection measure below 30 days, and our
substantially improved net income are just some of the contributors
to our solid balance sheet. For the quarter ended September 30, 2011, our debt to equity ratio was
1.3, an all-time low, and our working capital was $8.8 million."
Gathright continued:
"Despite the continuing global and domestic recessionary force,
the labor and other cost saving services we offer to the
marketplace have resulted in a 10% increase in our demand for the
quarter ended September 30, 2011 over
the same period last year. Our marketing efforts are focused on
achieving even higher organic growth and we are making investments
in our fleet to accommodate this anticipated growth. As new
equipment is put into service, its operation will not only meet the
more stringent future regulatory requirements but will also lower
repair and maintenance costs."
(1) EBITDA, fixed charges and fixed
coverage ratio are non-GAAP measures within the meaning of SEC
Regulation G. See "Non-GAAP Measures and Definitions below."
Highlights of First Quarter of Fiscal 2012 ended September 30, 2011
During the first quarter of fiscal 2012, our net income was
$820,000, or $0.10 per diluted common share, our operating
income was $1.1 million, and our
EBITDA(1), a non-GAAP measure, was $1.6
million. Our net margin per gallon(2) for the first quarter
of fiscal 2012 was $0.26. These
results are improvements over the first quarter fiscal 2011 net
income of $114,000 or $0.01 per diluted common share, operating income
of $346,000, EBITDA of $953,000 and net margin per gallon of
$0.23. These favorable results are a
continuation of the past two fiscal years of positive performance,
when we reported net income and net earnings per share of
$1.3 million and $0.15, respectively, in fiscal 2011 and
$465,000 and $0.05 per common share in fiscal 2010. After the
end of the quarter, our Board of Directors approved a 20% increase
in the dividend whereby each common shareholder on November 14, 2011, will receive 1.50 cents per share payable on December 2, 2011.
Revenues were $74.2 million in the
first quarter of fiscal 2012, as compared to $51.1 million in the same period of the prior
year, an increase of $23.1 million,
or 45%. Price variances in market prices of petroleum products
provided $16.1 million of the
increase in revenues and a 10% increase in gallons provided the
$7.0 million remainder of the
increase primarily due to the addition of new customers at existing
locations. We are preparing for additional projected growth by
investing in our truck fleet, having acquired four new specialized
fueling trucks during fiscal 2011, with six more to be delivered
during fiscal 2012. Our aggregate investment of approximately
$2.0 million through capital leases,
which began in fiscal 2011, will support an even higher level of
organic growth in both existing and possible new markets, while
reducing operating expenses, improving efficiencies and satisfying
the ever changing California
emissions standards.
We continued to enhance our shareholders' equity during the
quarter, through both contributions to equity from bottom line
performance and reduction of our existing term debt by the pay down
of $1.0 million in principal since
the same period a year ago. Our debt to equity ratio was 1.3 and
1.5 at September 30, 2011 and
June 30, 2011, respectively. Our debt
to equity ratio has dramatically improved from the pre-2009
Recapitalization debt to equity ratio of 9.1 and has further
improved over the 2010 fiscal year end, when it was 1.7. Since that
June 2009 Recapitalization, we have
continued to pay down our term loan by 20% per year. That reduction
of debt, together with our improved receivables collection rate and
our positive net income over the last two years, which in turn
lowered the balance on our line of credit, all contributed to the
lower debt to equity ratio. It is noteworthy that there is such a
marked improvement in the debt to equity ratio even after the
accrual or payment for dividends on our common and preferred shares
and the share repurchase program.
Also, we continue to look for opportunities for returning
capital to our shareholders. In August
2011, the Board of Directors approved a quarterly dividend
program on our common stock. The first dividend of $0.0125 per share was paid on October 14, 2011, to shareholders of record as of
September 28, 2011. On October 3, 2011, we declared an increased
quarterly cash dividend of $0.015 per
share, a 20% increase from the prior quarter, which will be paid on
December 2, 2011 to common
stockholders of record on November 14,
2011. While there are no guarantees of future performance or
common stock dividends, we believe that our quarterly common stock
dividend program is sustainable and will substantially benefit our
common stock shareholders for the foreseeable future.
In September 2011, we renewed our
credit facility with our principal lender for an additional five
years, or until September 27, 2016,
and amended the loan agreement to significantly improve a number of
terms. The amendments increased the maximum borrowing under the
revolving line of credit portion of the facility from $20.0 million to $25.0
million, authorized a real estate loan of up to $1.3 million secured by our recently acquired
Lufkin facility, and reduced the applicable interest rates from a
then existing range of 4.00% to 4.75% per annum to a new range of
2.50% to 2.75%. We currently estimate that the new, lower interest
rates will provide us with annual savings of approximately
$270,000, or $1.36 million over five years. Our estimated
savings is based on a number of assumptions, including but not
limited to the LIBOR 90 day rate remaining at or close to current
levels at the time of the amendment. As a result of this five year
extension and other changes in its terms, our line of credit has
been reclassified as a long-term liability, which is reflected on
our balance sheet, thereby increasing our working capital
substantially.
Deferred Tax Asset. Because the valuation allowance that
we take against our net deferred tax asset is based upon management
estimates of future profitability and taxable income, as we
continue to generate taxable income on a consistent basis, it
becomes more likely that we will decide to reduce the valuation
allowance to reflect estimated future taxable income. Any such
reduction of the valuation allowance will be reflected in our
financial statements as an income tax benefit, which benefit will
correspondingly increase our net income for the period during which
we make the adjustment. As of September 30,
2011, our current net deferred tax asset of $9.4 million is fully reserved. If we continue to
report positive bottom line performance during fiscal 2012
comparable to what we reported in fiscal 2011, we may eliminate all
or a portion of the valuation allowance that we have reserved
against this net deferred tax asset. In such an event, we would
report a substantial increase in earnings at the time that
adjustment is made, along with a correlating increase to our
Shareholders' Equity, on a one time basis.
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
Ended September 30,
2011 2010
Petroleum product sales and service
revenues $ 66,727 $ 45,057
Petroleum product taxes 7,478 6,004
Total revenues 74,205 51,061
Cost of petroleum product sales and service 61,747 41,219
Petroleum product taxes 7,478 6,004
Total cost of sales 69,225 47,223
Gross profit 4,980 3,838
Selling, general and administrative
expenses 3,891 3,492
Operating income 1,089 346
Interest expense (249) (223)
Interest and other income 2 2
Income before income taxes 842 125
Income tax expense (22) (11)
Net income $ 820 $ 114
Basic and diluted net income per share
computation:
Net income per share attributable to common
shareholders:
Basic $ 0.10 $ 0.01
Diluted $ 0.10 $ 0.01
Weighted average common shares outstanding:
Basic 8,367 8,549
Diluted 8,593 8,683
EBITDA (non-GAAP measure)(1) $ 1,554 $ 953
Gallons sold 19,773 17,912
Net margin per gallon(2) $ 0.26 $ 0.23
Dividends declared per common share $ 0.0125 $ -
(1)Non-GAAP measure. See "Non-GAAP
Measures and Definitions" below.
(2) See "Non-GAAP Measures and Definitions" below.
Condensed Consolidated Balance Sheet
All amounts in thousands of dollars
September 30, 2011 June 30, 2011
ASSETS
Current assets $ 23,109 $ 23,790
Property, plant and equipment, net 8,603 7,083
Other assets, net 2,017 2,646
Total assets $ 33,729 $ 33,519
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $ 14,282 $ 14,029
Long-term debt, net and other liabilities 10,715 11,489
Stockholders' equity 8,732 8,001
Total liabilities and shareholders' equity $ 33,729 $ 33,519
Non-GAAP Measures and Definitions
(1)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. The stock-based compensation amortization
expense is considered an amortization item to be excluded in the
EBITDA calculation.
(2) Net Margin Per Gallon. Net margin per gallon
is one of the most important measures of our financial performance.
It is calculated by adding the cost of sales depreciation and
amortization to gross profit, and dividing that sum by the number
of gallons sold.
CONFERENCE CALL
Management will host a conference call on November 16, 2011 at 10:30
a.m. Eastern Time ("ET") to further discuss the results
of the Company's first quarter ended September 30, 2011. Interested parties can listen
to the call live on the Internet through the Company's Web site at
http://www.mobilefueling.com or by dialing 866-783-2140
(domestic) or +1-857-350-1599 (international), using Pass
Code 63353466. 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 http://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 (http://www.streetevents.com). A
telephone replay of the conference call will be available from
November 16, 2011 at 1:30 p.m. ET until midnight ET on November 23, 2011, by dialing 888-286-8010
(domestic) or +1-617-801-6888 (international), using Pass
Code 73131584. A web archive will be available for 30 days at
http://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
http://www.mobilefueling.com.
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 ability to make dividend payments,
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, 2011.
Contact: Michael S. Shore
Chief Financial Officer
+1-954-308-4200