Will Significantly Expand Land Segment in the
United Kingdom
World Fuel Services Corporation (NYSE: INT), announced today
that a wholly-owned subsidiary of the company has signed a
definitive agreement to acquire Watson Petroleum Limited, a leading
distributor of gasoline, diesel, heating oil, lubricants and other
products and related services across England and Wales, for a
purchase price of £117 million ($191 million). The purchase price
will be funded through cash-on-hand and the company’s existing
credit facilities.
Watson Petroleum is headquartered in Brinkworth, England and has
670 employees. With expected 2013 revenue of $2.2 billion, Watson
Petroleum is one of the largest fuel distributors in the United
Kingdom.
“We look forward to welcoming the Watson Petroleum team to World
Fuel Services,” said Michael J. Kasbar, president and chief
executive officer of World Fuel Services Corporation. “Combined
with our existing land business in the United Kingdom, this
transaction will further solidify Watson’s position as one of the
largest distributors of ground-based fuels in the United Kingdom
and will provide a platform for further growth in the ground fuels
space in the United Kingdom and elsewhere in Europe.”
“We are very excited to be joining a company with the
capabilities and breadth of products and services of World Fuel.
Coupled with World Fuel’s solid financial foundation, this
transaction will allow us to expand our product and service
offerings and further grow our distribution network,” stated Tony
Watson, managing director of Watson Petroleum Limited.
The transaction is expected to be $0.18 to $0.22 accretive to
earnings on a GAAP basis in the first twelve months. Non-GAAP
accretion, which excludes amortization of acquired intangible
assets of approximately $0.10 per share, is expected to be $0.28 to
$0.32 in the first twelve months.
The transaction is subject to customary regulatory consents and
closing conditions and is expected to be completed within the next
ninety days.
Information Relating to Forward-Looking
Statements
With the exception of historical information in this news
release, this document includes forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, including statements regarding our expectations about Watson
Petroleum’s 2013 revenue, the effect of the transaction on its
position as a distributor in the United Kingdom, its opportunities
for growth and expansion of offerings, as well as our expectations
about the timing of closing, the funding of the purchase price, and
the effect of the transaction on our earnings. These
forward-looking statements are qualified in their entirety by
cautionary statements and risk factor disclosures contained in the
company’s Securities and Exchange Commission (“SEC”) filings,
including the company’s Annual Report on Form 10-K filed with the
SEC on February 21, 2013. Actual results may differ materially from
any forward-looking statements due to risks and uncertainties,
including, but not limited to: our ability to effectively integrate
and derive benefits from the acquired business, our ability to
capitalize on new market opportunities, unexpected delays in
closing, potential liabilities and the extent of any insurance
coverage, the impact of quarterly fluctuations in results, the
creditworthiness of our 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 and suppliers
operate, our failure to effectively hedge certain financial risks
associated with the use of derivatives, non-performance by
counterparties or customers on derivatives contracts, loss of, or
reduced sales, to a significant government customer, uninsured
losses, the impact of natural disasters, adverse results in legal
disputes, unanticipated tax liabilities, our ability to retain and
attract senior management and other key employees and other risks
detailed from time to time in the company’s SEC filings. New risks
emerge from time to time and it is not possible for management to
predict all such risk factors or to assess the impact of such risks
on our business. Accordingly, we undertake no obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, changes in expectations, future
events, or otherwise.
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”). Specifically, we
have used non-GAAP accretion to earnings per share, which excludes
amortization of acquired intangible assets, primarily because we do
not believe it is reflective of the company’s core operating
results. We believe that this non-GAAP financial measure, when
considered in conjunction with our financial information prepared
in accordance with GAAP, is 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 accretion may not be comparable to the presentation of
such metric by other companies. Investors are encouraged to review
the reconciliation of this non-GAAP measure to its most directly
comparable GAAP financial measure contained in this press
release.
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 8,000 locations in more than 200 countries and territories
worldwide.
The company's global team of market makers provides deep domain
expertise in all aspects of aviation, marine and land fuel
management. Aviation customers include commercial airlines, cargo
carriers, private aircraft and fixed base operators (FBOs), 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. The company also offers
transaction management services which consist of card payment
solutions and merchant processing services to customers in the
aviation, marine and land transportation industries. For more
information, call 305-428-8000 or visit www.wfscorp.com.
World Fuel Services CorporationIra M. Birns,
305-428-8000Executive Vice President & Chief Financial
Officer
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