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Westway Group, Inc. Reports 25% Increase In Financial Results

NEW ORLEANS, Aug. 9, 2010 (GLOBE NEWSWIRE) -- Westway Group, Inc. (Nasdaq:WWAY) today reported consolidated Adjusted EBITDA for the three months ended June 30, 2010 of $8.8 million, up $1.1 million or 14% from the pro forma results for the three months ended June 30, 2009. Consolidated Adjusted EBITDA for the six months ended June 30, 2010 totaled $21.9 million, up $4.4 million or 25% from the pro forma results for the same period in 2009. 

Consolidated Adjusted EBITDA reflects income before income tax provision, depreciation, interest expense, and other related non-cash items. The pro forma numbers are calculated as though Westway had acquired the bulk liquid storage and liquid feed supplements businesses of the ED&F Man group on January 1, 2009, rather than May 28, 2009, with certain adjustments, as described in our 10-Q, to be filed later today.

As a result of Westway's qualification on June 30, 2010 as a smaller reporting company and the signing of the Dodd-Frank Wall Street Reform and Consumer Protection Act on July 21, 2010, we are conforming our disclosures for present and future requirements of the new designation and the new Act.

2nd quarter of 2010, highlights:

  • Consolidated Adjusted EBITDA for the quarter grew from $7.8 million in 2009 to $8.8 million in 2010, an increase of 14%;  
  • Net revenue for the bulk liquid storage segment totaled $21.4 million for the three months ended June 30, 2010 compared to $16.9 million on a pro forma basis for the three months ended June 30, 2009, an increase of 27% -- which was primarily driven by our recent expansions at our Cincinnati, OH, Grays Harbor, WA, Houston, TX, and Port Allen, LA terminal facilities, while increasing capacity utilization for all of our terminal facilities from 91% at June 30, 2009 to 94% at June 30, 2010;
  • Net revenue for the liquid feed supplement segment totaled $54.2 million for the three months ended June 30, 2010 compared to $61.0 million on a pro forma basis for the three months ended June 30, 2009 -- which is reflective of a decline in volume as well as volatility in commodity inputs and continued weakness in the cattle and dairy markets;
  • We completed our first full quarter of results from the 5.6 million gallon expansion at our Port Allen, LA terminal --which now has a total capacity of 21.8 million gallons and a 98% capacity utilization at June 30, 2010;
  • James B. Jenkins, a director of the Company, was appointed interim Chief Executive Officer, and Wayne Driggers, our Chief Operating Officer, was named President of the Company. Mr. Driggers was also appointed to serve on the Company's Board of Directors as a Class A Director until 2012.

2nd Quarter 2010 Actual Compared to 2nd Quarter 2009 Pro Forma

The consolidated results for the three-month period ended June 30, 2010 reflect actual results and are in each case compared to pro forma results for the same period in 2009. 

  • Consolidated net revenue for 2010 decreased by $2.3 million to $75.6 million, or 3%, as compared to 2009 on a pro forma basis, primarily due to a decline of approximately 7 thousand tons or 2% in liquid feed supplement volume; 
  • Consolidated Adjusted Gross Profit for the quarter increased to $16.8 million in 2010 from $14.2 million for the same period a year ago, up $2.7 million or 19%;
  • Second quarter 2010 actual results reflect final purchase accounting adjustments for the acquisition of the bulk liquid storage and liquid feed supplements businesses from ED&F Man as of May 28, 2009 and stock based compensation. See Note 3 to this release.

Quarterly Comparison of Consolidated Performance

  (Actual)  3 Months Ended June 30, 2010  (Pro Forma)  3 Months Ended June 30, 2009 
  Consolidated (3) Consolidated (3)
     
Net Revenue $75,643 $77,898
Adjusted Gross Profit (2) 16,834 14,173
Income (loss) before income tax benefit (provision) and equity in unconsolidated subsidiaries  (1,718) 1,738
Adjusted EBITDA (1) 8,841 7,772

Six Months 2010 Actual Compared to Six Months 2009 Pro Forma

Consolidated results for the six-month period ended June 30, 2010 reflect actual results, and are in each case compared to pro forma results for the same period in 2009. 

  • Consolidated net revenue decreased by $8.0 million to $169.1 million, or 5%, as compared to the same period in the prior year on a pro forma basis, primarily due to a decline of approximately 21 thousand tons or 3% in liquid feed supplement volume. 
  • Consolidated Adjusted Gross Profit increased by $6.7 million to $38.5 million, up 21%.
  • See Note 3 for the explanations for finalized purchase price adjustments and stock based compensation, which also affected the results for the six-month period ended June 30, 2010.   

Six Month Comparison of Consolidated Performance

  (Actual)  6 Months Ended June 30, 2010  (Pro Forma)  6 Months Ended June 30, 2009 
  Consolidated (3) Consolidated (3)
     
Net Revenue $169,085 $177,100
Adjusted Gross Profit (2) 38,521 31,788
Income (loss) before income tax benefit (provision) and equity in unconsolidated subsidiaries 4,461 5,853
Adjusted EBITDA (1) 21,901 17,538

Business Drivers

Bulk Liquid Storage

In our liquid storage business, the primary drivers of performance are total capacity, capacity utilization, rates, and throughput. Our total capacity increased from approximately 303 million gallons on June 30, 2009 to approximately 354 million gallons as of June 30, 2010, and our capacity utilization increased from 91% at June 30, 2009 to 94% at June 30, 2010. We utilize long-term contractual arrangements in our bulk liquid storage business, which include annual Consumer Price Index adjustments.      

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