Adams Resources & Energy, Inc. announced operational and financial results for the three months ended June 30, 2021 and declared a quarterly cash dividend of $0.24 per common share.
- Reported net earnings of $4.7 million, or $1.10 per diluted common share, on revenues of $486.7 million for the second quarter of 2021, compared to $3.5 million, or $0.82 per diluted common share, on revenues of $152.3 million for the second quarter of 2020.
- Generated net cash provided by operating activities of $29.1 million for the second quarter of 2021, compared to net cash used in operating activities of $6.6 million for the second quarter of 2020. The increase was primarily driven by changes in working capital due to an increase in the market price of crude oil.
- Reported adjusted net earnings of $1.9 million, or $0.44 per diluted common share, for the second quarter of 2021, compared to an adjusted net loss of $0.8 million, or a loss of $0.18 per diluted common share, for the second quarter of 2020.
- Adjusted cash flow for the second quarter of 2021 was $7.4 million versus $1.9 million for the second quarter of 2020.
- Adjusted net earnings (losses), adjusted earnings (losses) per diluted common share and adjusted cash flow are non-generally accepted accounting principle ("non-GAAP") financial measures that are defined and reconciled in the financial tables later in this release.
Additional Highlights for Q2 2021
- Maintained strong financial flexibility at June 30, 2021, including $88.7 million in cash and cash equivalents. This represented a 126% increase from $39.3 million at December 31, 2020.
- Liquidity of $111.4 million at June 30, 2021, including cash and cash equivalents and $22.8 million available under the Company's $40.0 million Credit Agreement entered into in May 2021.
- Adam's crude oil marketing subsidiary, GulfMark Energy, Inc. ("GulfMark"), marketed approximately 89,585 barrels per day ("bpd") of crude oil during the second quarter of 2021, compared to 81,152 bpd during the second quarter of 2020 and 82,889 bpd during the first quarter of 2021. GulfMark held 413,973 barrels of crude oil inventory at June 30, 2021, compared to 421,759 barrels at December 31, 2020.
- The collective fleet of Service Transport Company ("Service Transport"), Adams' liquid chemicals, pressurized gases, asphalt and dry bulk transportation subsidiary, traveled approximately 7.25 million miles during the second quarter of 2021, compared to 3.89 million miles during the second quarter of 2020 and 6.93 million miles during the first quarter of 2021. Significantly contributing to the year-over-year increase in miles traveled for the second quarter was the June 2020 purchase of assets from CTL Transportation, which added new services and product lines for the Company's new and existing customers in new markets in Florida, Georgia, Illinois, Missouri and Ohio.
Kevin J. Roycraft, Adams' Chief Executive Officer, commented, "We were pleased with our results for the second quarter of 2021, including generating adjusted cash flow that was almost four times higher than both the first quarter of this year and the second quarter of 2020. Contributing to our financial performance for this year's second quarter was a continued improvement in the economic backdrop, including increased demand for crude oil and a resulting higher price environment. Our recent acquisitions in our transportation and pipeline and storage segments also benefited our results for the period. We were especially pleased with the second quarter performance of the VEX Pipeline System, which we acquired in October of last year, producing positive cash flow in its second full quarter of operation."
Capital Investments and Dividends
During the second quarter of 2021, the Company spent capital of $3.4 million for trailers and other field equipment. In addition, Adams paid dividends of $1.0 million, or $0.24 per common share.
Adams' Board of Directors has declared a quarterly cash dividend for the second quarter of 2021 of $0.24 per common share, payable on September 17, 2021, to shareholders of record as of September 3, 2021. Adams' has consistently paid a dividend since 1994.
Mr. Roycraft concluded, "Looking to the second half of 2021, we remain focused on increasing efficiencies in each of our business segments. This includes further integrating our newly acquired terminals and leveraging back haul opportunities with continued efforts to diversify our offerings. We also plan to grow in new and existing areas with our crude oil marketing segment. Finally, as we have successfully done in the past, we will continue to evaluate business development opportunities that complement our core businesses and support our mission of providing unparalleled service quality and reliability for our customers."
"Underpinning our strategic initiatives to enhance and expand our business is ensuring we maintain a solid financial position. Our strong balance sheet and significant liquidity served us well in the economic depths associated with the pandemic, and we believe our financial flexibility will continue to differentiate Adams in the marketplace moving forward. Also key to our past and future success is the dedicated efforts of our full employee team. I look forward to working closely with them as we identify and execute on additional targeted opportunities to prudently grow the business for the long-term benefit of our shareholders."