Vertex Energy, Inc. Quarterly Report for the Period Ended March 31, 2024

Press release · 05/10 07:04
Vertex Energy, Inc. Quarterly Report for the Period Ended March 31, 2024

Vertex Energy, Inc. Quarterly Report for the Period Ended March 31, 2024

Vertex Energy, Inc. has filed a Form 10-Q for the quarterly period ended March 31, 2024, with the Securities and Exchange Commission. The company is a smaller reporting company and an emerging growth company. They have 93,514,346 shares of common stock issued and outstanding.

Overview

Vertex Energy is an energy company that specializes in refining and marketing conventional and renewable transportation fuels. The company operates two main business segments:

  1. Refining and Marketing: Focuses on producing conventional fuels like gasoline, diesel, and jet fuel at the Mobile Refinery facility. This segment generated 92.4% of total revenue in Q1 2024.

  2. Black Oil and Recovery: Focuses on re-refining used motor oil and other petroleum streams into end products. This segment generated less than 10% of revenue in Q1 2024.

Financial Highlights

Key Figures Q1 2024 Q1 2023
Revenue $695 million $691 million
Net Income $(17.9) million $53.8 million
  • Revenue was up slightly due to higher refined product and service revenue
  • Net income declined significantly due to lower crack spreads and losses from the renewable diesel (RD) unit

Profitability Analysis

  • Gross profit fell from $67.5 million to $35.1 million
    • Losses of $10.5 million from the RD unit
    • Lower crack spreads reduced margin per barrel by 28%
  • Net loss of $17.9 million compared to net income of $53.8 million last year
    • Primarily due to losses from the RD unit caused by high feedstock prices

Cash Flow and Liquidity

  • Cash used in operations was $29.1 million compared to $36.8 million last year
  • Cash used for investing activities was $12.2 million compared to cash provided of $13.3 million last year
  • Cash from financing activities was $26.5 million compared to cash used of $27.6 million last year
  • Working capital decreased due to higher inventory financing obligations

Outlook

  • Pausing renewable diesel production to focus on conventional fuels
  • Seeking to refinance debt maturing in April 2025
  • Implementing cost reduction initiatives to improve cash flow
  • Believe sufficient liquidity exists to meet obligations for next 12 months

In summary, Vertex faced declining profitability in Q1 2024 compared to last year, driven by losses in the renewable diesel business. The company is now pivoting its strategy to focus more on conventional fuels and reducing costs to improve its financial position. Refinancing debt and securing additional liquidity are also key priorities for management.