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World Fuel Services Corporation Reports Second Quarter Results

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 (FBO’s), 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. For more information, call 305-428-8000 or visit www.wfscorp.com.

WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE DATA)
 
        For the Three Months ended   For the Six Months ended
June 30, June 30,
2012   2011 2012   2011
 
 
Revenue $ 9,618,797 $ 8,708,709 $ 19,097,852 $ 15,788,115
Cost of revenue   9,446,674     8,543,607     18,768,494     15,486,245  
 
Gross profit   172,123     165,102     329,358     301,870  
 
Operating expenses:
Compensation and employee benefits 56,183 54,877 110,710 101,946
Provision for bad debt 641 3,531 782 4,327
General and administrative   42,941     40,591     86,252     73,969  
 
Total operating expenses   99,765     98,999     197,744     180,242  
 
Income from operations 72,358 66,103 131,614 121,628
Non-operating expenses, net   (5,525 )   (4,381 )   (9,620 )   (7,834 )
 
Income before income taxes 66,833 61,722 121,994 113,794
Provision for income taxes   11,951     11,049     18,566     21,464  
 
Net income including noncontrolling interest 54,882 50,673 103,428 92,330
Net income attributable to noncontrolling interest   6,282     470     8,413     1,018  
 
Net income attributable to World Fuel $ 48,600   $ 50,203   $ 95,015   $ 91,312  
 
Basic earnings per common share $ 0.68   $ 0.71   $ 1.34   $ 1.30  
 
Basic weighted average common shares   71,173     70,856     71,083     70,400  
 
Diluted earnings per common share $ 0.68   $ 0.70   $ 1.32   $ 1.28  
 
Diluted weighted average common shares   71,767     71,558     71,773     71,299  
 

WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED - IN THOUSANDS)
 
        As of
June 30,   December 31,
2012 2011
 
Assets:
Current assets:
Cash and cash equivalents $ 136,676 $ 205,415
Accounts receivable, net 2,124,645 2,160,561
Inventories 557,390 472,584
Prepaid expenses and other current assets   478,134   283,667
 
Total current assets 3,296,845 3,122,227
 
Property and equipment, net 92,597 90,710
 
Goodwill, identifiable intangible and non-current other assets   498,452   484,309
 
Total assets $ 3,887,894 $ 3,697,246
 
Liabilities and equity:
Liabilities:
Current liabilities:
Short-term debt $ 23,780 $ 17,800
Accounts payable 1,774,508 1,739,678
Accrued expenses and other current liabilities   289,456   268,664
 
Total current liabilities 2,087,744 2,026,142
 
Long-term debt 308,212 269,348
Other long-term liabilities   52,870   55,038
Total liabilities   2,448,826   2,350,528
 
Equity:
World Fuel shareholders' equity 1,418,218 1,332,961
Noncontrolling interest equity   20,850   13,757
Total equity   1,439,068   1,346,718
 
Total liabilities and equity $ 3,887,894 $ 3,697,246
 

WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED - IN THOUSANDS)
     
For the Three Months ended For the Six Months ended
June 30, June 30,
2012   2011   2012   2011  
 
Cash flows from operating activities:
Net income including noncontrolling interest   54,882   $ 50,673     103,428   $ 92,330  
Adjustments to reconcile net income including
noncontrolling interest to net cash (used in) provided by
operating activities:
Depreciation and amortization 8,009 10,573 17,668 18,740
Provision for bad debt 641 3,531 782 4,327
Share-based payment award compensation costs 3,053 2,793 5,957 5,658
Other (9,794 ) 4,948 (1,023 ) 3,880
Change in cash collateral deposits held by financial counterparties (139,637 ) 1,449 (128,058 ) (650 )
Changes in other assets and liabilities, net of acquisitions   (22,869 )   (67,180 )   (55,677 )   (261,984 )
Total adjustments   (160,597 )   (43,886 )   (160,351 )   (230,029 )
Net cash (used in) provided by operating activities   (105,715 )   6,787     (56,923 )   (137,699 )
 
Cash flows from investing activities:
Acquisitions and other investments, net of cash acquired (28,948 ) (39,013 ) (29,038 ) (106,013 )
Capital expenditures (5,619 ) (4,766 ) (9,567 ) (7,394 )
Other   115     -     -     -  
Net cash used in investing activities   (34,452 )   (43,779 )   (38,605 )   (113,407 )
 
Cash flows from financing activities:
Borrowings of debt, net 39,085 92,340 37,593 131,877
Dividends paid on common stock (2,686 ) (2,696 ) (5,350 ) (5,294 )
Other   (952 )   3,236     (5,947 )   (265 )
Net cash provided by financing activities   35,447     92,880     26,296     126,318  
 
Effect of exchange rate changes on cash and
cash equivalents   (1,197 )   473     493     1,630  
 
Net (decrease) increase in cash and cash equivalents (105,917 ) 56,361 (68,739 ) (123,158 )
 
Cash and cash equivalents, as of beginning of period   242,593     93,374     205,415     272,893  
 
Cash and cash equivalents, as of end of period $ 136,676   $ 149,735   $ 136,676   $ 149,735  

WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE DATA)
             
For the Three Months ended For the Six Months ended
June 30, June 30,
2012 2011 2012 2011
 
Non-GAAP financial measures and reconciliation:
 
GAAP net income attributable to World Fuel $ 48,600 $ 50,203 $ 95,015 $ 91,312
Share-based compensation expense, net of taxes 2,107 1,879 4,108 3,888
Intangible asset amortization expense, net of taxes   2,118   5,571   6,584   9,233
Non-GAAP net income attributable to World Fuel $ 52,825 $ 57,653 $ 105,707 $ 104,433
 
GAAP diluted earnings per common share $ 0.68 $ 0.70 $ 1.32 $ 1.28
Share-based compensation expense, net of taxes 0.03 0.03 0.06 0.05
Intangible asset amortization expense, net of taxes   0.03   0.08   0.09   0.13
Non-GAAP diluted earnings per common share $ 0.74 $ 0.81 $ 1.47 $ 1.46
 

WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
BUSINESS SEGMENT INFORMATION
(UNAUDITED - IN THOUSANDS)
 
    For the Three Months ended   For the Six Months ended
June 30, June 30,
  2012     2011   2012     2011
Revenue:
Aviation segment $ 3,547,871 $ 3,364,829 $ 6,959,418 $ 6,011,421
Marine segment 3,767,144 3,532,983 7,671,335 6,532,402
Land segment   2,303,782   1,810,897   4,467,099   3,244,292
$ 9,618,797 $ 8,708,709 $ 19,097,852 $ 15,788,115
 
Gross profit:
Aviation segment $ 69,171 $ 82,027 $ 134,085 $ 152,155
Marine segment 51,748 50,674 106,825 90,889
Land segment   51,204   32,401   88,448   58,826
$ 172,123 $ 165,102 $ 329,358 $ 301,870
 
Income from operations:
Aviation segment $ 25,960 $ 37,624 $ 52,793 $ 75,794
Marine segment 27,931 25,763 55,376 43,118
Land segment   28,352   14,026   44,552   24,689
82,243 77,413 152,721 143,601
Corporate overhead - unallocated   9,885   11,310   21,107   21,973
$ 72,358 $ 66,103 $ 131,614 $ 121,628




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