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World Fuel Services Corp.
9800 NW 41st Street
Suite 400
Miami, FL 33178
United States - Map
Phone: 305-428-8000
Fax: 201-692-3247
Web Site: http://www.wfscorp.com
DETAILS
Index Membership: S&P 600 SmallCap
S&P 1500 Super Comp
Sector: Services
Industry: Basic Materials Wholesale
Full Time Employees: 743
BUSINESS SUMMARY
World Fuel Services Corporation, through its subsidiaries, engages in the marketing and sale of marine, aviation, and land fuel products and related services worldwide. It operates in three segments: Marine, Aviation, and Land. The Marine segment markets fuel and related services to various customers, including international container and tanker fleets, and time-charter operators, as well as to the United States and foreign governments. It offers these products and services under World Fuel, Trans-Tec, Bunkerfuels, Oil Shipping, Marine Energy, Norse Bunker, Casa Petro, and Tramp Oil trade names. The Aviation segment markets fuel and related services to commercial airlines, second and third-tier airlines, cargo carriers, regional and low cost carriers, corporate fleets, fractional operators, private aircraft, military fleets, and to the United States and foreign governments. Its aviation related services include fuel management and price risk management, as well as arranges ground handling and international trip planning, including flights plans, weather reports, and overflight permits. It offers these products and services under World Fuel, Baseops, Airdata, PetroServicios de Mexico, and PetroServicios de Costa Rica trade names. The Land segment markets fuel and related services to petroleum distributors operating in the land transportation market. Its land related services include management services for the procurement of fuel, price risk management, and financing. The company sells its products and services through a network of offices located in the United States, the United Kingdom, Denmark, Norway, the Netherlands, Germany, Greece, Turkey, the United Arab Emirates, Russia, the People's Republic of China, Taiwan, South Korea, Singapore, Japan, Hong Kong, Costa Rica, Brazil, Chile, Argentina, Mexico, Colombia, and South Africa. World Fuel Services was founded in 1984 and is based in Miami, Florida.
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World Fuel Services Corporation Reports Results for the Fourth Quarter and Full Year 2007
Thursday February 28, 4:05 pm ET
MIAMI--(BUSINESS WIRE)--World Fuel Services Corporation (NYSE:INT - News), a global leader in the marketing and sale of marine, aviation and land fuel products and related services, today reported fourth quarter net income of $18.1 million, ($0.64 and $0.63 per share on a basic and diluted basis, respectively), compared to $17.3 million, ($0.62 and $0.60 per share on a basic and diluted basis, respectively), in the fourth quarter of 2006. Our 2007 fourth quarter results were adversely affected by an impairment charge of $2.4 million relating to the write down of capitalized software development costs associated with an aviation flight planning company acquired in 1998. The after-tax effect of the impairment charge was $1.7 million, or $0.06 per share on a basic and diluted basis. For the full year, net income was $64.8 million ($2.30 and $2.23 per share on a basic and diluted basis, respectively), compared to $63.9 million ($2.33 and $2.21 per share on a basic and diluted basis, respectively) in 2006. Our full year results were impacted by impairment charges relating to the write down of a commercial paper investment and capitalized software development costs, aggregating $3.0 million after-tax, or $0.11 per share on a basic and diluted basis.
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"While full year results were clearly impacted by strategic investments in people and systems, we finished the year with a strong fourth quarter," said Paul H. Stebbins, chairman and chief executive officer of World Fuel Services Corporation. "Our aviation segment which delivered strong growth in volumes and gross profit for the year, generated record gross profit of $39.1 million in the fourth quarter, an increase of 18% sequentially and 37% year-over-year. As in the third quarter, our aviation segment benefited from increases in jet fuel prices during the quarter," added Stebbins.
Our marine segment also delivered solid growth in volume and profitability in 2007, generating gross profit of $32.8 million in the fourth quarter, an increase of 22% from the third quarter and 20% year-over-year. "Our marine segment has now generated year-over-year increases in gross profit for twelve out of the last thirteen quarters and while gross profit in our land segment decreased 8% sequentially, gross profit increased 10% year-over-year, our sixth consecutive year-over-year increase in gross profit," stated Michael J. Kasbar, president and chief operating officer.
"During the fourth quarter, the company also refinanced its bank credit facility, increasing availability under the facility to $475 million and extending the terms of such facility through December 2012," stated Ira M. Birns, Executive Vice President and Chief Financial Officer. "This facility provides us with increased liquidity to support both organic and strategic growth opportunities going forward," added Birns.
FOURTH QUARTER AND FULL YEAR FINANCIAL HIGHLIGHTS
($ in thousands, except per share data)
Quarter Ended December 31,
Year Ended December 31,
2007 2006 2007 2006
Revenue $ 4,145,522 $ 2,618,733 $ 13,729,555 $ 10,785,136
Gross profit $ 73,841 $ 57,721 $ 245,272 $ 214,069
Income from operations
$ 24,554 $ 18,837 $ 85,888 $ 76,646
Net income $ 18,130 $ 17,269 $ 64,773 $ 63,948
Basic earnings per share
$ 0.64 $ 0.62 $ 2.30 $ 2.33
Diluted earnings per share
$
0.63 $ 0.60 $ 2.23 $ 2.21
About World Fuel Services Corporation
Headquartered in Miami, Florida, World Fuel Services Corporation is a global leader in the marketing and sale of marine, aviation and land fuel products and related services. World Fuel Services provides fuel and related services at more than 2,500 airports, seaports and tanker truck loading terminals worldwide. With 43 offices (including satellite offices) strategically located throughout the world, World Fuel Services offers its customers 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. World Fuel Services' marine customers include international container and tanker fleets and time-charter operators, as well as the United States and foreign governments. Aviation customers include commercial airlines, cargo carriers and corporate clientele, as well as the United States and foreign governments. Land customers are primarily petroleum distributors. For more information, call (305) 428-8000 or visit http://www.wfscorp.com.
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 management of growth, fluctuations in world oil prices or foreign currency, major changes in political, economic, regulatory, or environmental conditions, the loss of key customers, suppliers or key members of senior management, uninsured losses, competition, credit risk associated with accounts and notes receivable, 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.
WORLD FUEL SERVICES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE DATA)
For the Three Months Ended For the Year Ended
December 31, December 31,
2007 2006 2007 2006
Revenue $ 4,145,522 $ 2,618,733 $ 13,729,555 $ 10,785,136
Cost of sales 4,071,681 2,561,012 13,484,283 10,571,067
Gross profit 73,841 57,721 245,272 214,069
Operating expenses:
Compensation and employee benefits 26,104 21,828 94,809 82,987
Executive severance costs - - - 1,545
Provision for bad debts 1,298 2,292 1,892 3,869
General and administrative 21,885 14,764 62,683 49,022
49,287 38,884 159,384 137,423
Income from operations 24,554 18,837 85,888 76,646
Interest and other income, net 582 2,278 698 4,753
Income before income taxes 25,136 21,115 86,586 81,399
Provision for income taxes 6,876 3,698 21,235 17,353
18,260 17,417 65,351 64,046
Minority interest in income of consolidated subsidiaries
130 148 578 98
Net income $ 18,130 $ 17,269 $ 64,773 $ 63,948
Basic earnings per share $ 0.64 $ 0.62 $ 2.30 $ 2.33
Basic weighted average shares 28,213 27,835 28,102 27,467
Diluted earnings per share $ 0.63 $ 0.60 $ 2.23 $ 2.21
Diluted weighted average shares 29,004 29,021 29,062 28,923
WORLD FUEL SERVICES CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED - IN THOUSANDS)
As of December 31,
2007 2006
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 36,151 $ 176,495
Restricted cash 10,000 -
Short-term investments 8,100 12,500
Accounts and notes receivable, net 1,370,656 860,084
Inventories 103,029 74,519
Receivables related to derivative contracts 86,531 37,070
Prepaid expenses and other current assets 50,841 35,423
Total current assets 1,665,308 1,196,091
PROPERTY AND EQUIPMENT, NET 36,870 26,730
GOODWILL 52,104 44,321
IDENTIFIABLE INTANGIBLE ASSETS, NET 26,478 4,961
OTHER ASSETS 17,286 5,297
$ 1,798,046 $ 1,277,400
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term debt $ 53 $ 10
Accounts payable 1,066,971 720,790
Payables related to derivative contracts 88,302 34,209
Customer deposits 38,452 23,399
Accrued expenses and other current liabilities 37,333 48,353
Total current liabilities 1,231,111 826,761
DEBT
45,191 20,062
LONG-TERM LIABILITIES 37,867 4,608
SHAREHOLDERS' EQUITY 483,877 425,969
$ 1,798,046 $ 1,277,400
WORLD FUEL SERVICES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED - IN THOUSANDS)
For the Three Months Ended For the Year Ended
December 31, December 31,
2007 2006 2007 2006
Cash flows from operating activities:
Net income $ 18,130 $ 17,269 $ 64,773 $ 63,948
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Provision for bad debts 1,298 2,292 1,892 3,869
Depreciation and amortization 2,710 1,431 6,901 4,866
Deferred income tax (benefit) provision (2,373 ) 814 (3,020 ) 4,187
Unrealized derivatives losses (gains), net 715 561 107 (856 )
Share based payment compensation costs for employees and non-employee directors
1,731 2,152 7,166 7,035
Software write-down 2,445 - 2,445 -
Impairment on short-term investments - - 1,900 -
Other non-cash operating charges (credits) 688 133 449 73
Changes in operating assets and liabilities:
Accounts receivable (175,411 ) (31,831 ) (454,293 ) (174,348 )
Inventories 11,481 (7,912 ) (26,780 ) (37,871 )
Other current assets (44,704 ) (3,155 ) (57,182 ) 3,607
Other assets (7,623 ) 29 (9,094 ) (26 )
Accounts payable 88,980 59,979 316,277 185,215
Accrued expenses and other current liabilities 41,765 12,175 60,351 8,406
Other 9,074 (746 ) 10,181 (221 )
Total adjustments (69,224 ) 35,922 (142,700 ) 3,936
Net cash (used in) provided by operating activities (51,094 ) 53,191 (77,927 ) 67,884
Cash flows from investing activities:
Capital expenditures (3,912 ) (4,698 ) (16,581 ) (20,031 )
Purchases of short-term investments - (27,500 ) (30,060 ) (58,555 )
Proceeds from the sale of short-term investments - 25,000 32,560 56,055
Acquisition of business, net of cash acquired (54,907 ) - (54,907 ) (2,646 )
Net cash used in investing activities (58,819 ) (7,198 ) (68,988 ) (25,177 )
Cash flows from financing activities:
Dividends paid on common stock (1,064 ) (1,066 ) (4,253 ) (4,160 )
Borrowings (repayments), net, under revolving credit facility 20,000 - 20,000 -
Restricted cash (10,000 ) - (10,000 ) -
Other 2,675 1,370 824 4,664
Net cash used in financing activities 11,611 304 6,571 504
Net (decrease) increase in cash and cash equivalents (98,302 ) 46,297 (140,344 ) 43,211
Cash and cash equivalents, at beginning of period 134,453 130,198 176,495 133,284
Cash and cash equivalents, at end of period $ 36,151 $ 176,495 $ 36,151 $ 176,495
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