Adams Resources & Energy, which includes GulfMark Energy and Service Transport Company, remained profitable in 2020 despite challenges created by the pandemic, with full year adjusted net earnings of $12.2 million, according to the company.
Adams reported adjusted net earnings of $4.1 million for 2019.
“Given the challenges faced during 2020 due to the COVID-19 pandemic, we were pleased to report solid full year and fourth quarter results,” said Kevin J. Roycraft, Adams’ chief executive officer. “Improving year-over-year adjusted cash flow and adjusted net earnings by 24% and 199%, respectively, is an amazing accomplishment by this team considering the economic backdrop.”
Net 2020 earnings, before adjustments, were $1 million on revenues of $1.02 billion, compared to net earnings of $8.2 million on revenues of $1.81 billion for 2019. Adams also reported net cash used in operating activities of $44 million, compared to net cash provided by operating activities of $46.9 million in 2019. However, the company said the decrease “was primarily driven by changes in working capital due to the volatility in the market price of crude oil during 2020 substantially due to the COVID-19 pandemic.”
Adjusted cash flow rose to $27.2 million in 2020 from $21.9 million in 2019.
For the fourth quarter of 2020, Adams generated net earnings of $5.8 million on revenues of $249.8 million, compared to net earnings of $2.7 million on revenues of $431.3 million for the fourth quarter of 2019.
GulfMark Energy, Adams’ crude oil marketing subsidiary, marketed 86,577 barrels per day (bpd) of crude oil during Q4, compared to 108,627 bpd during Q4 2019. For the full year, GulfMark moved 91,957 bpd vs. 107,383 bpd in 2019.
Service Transport, Adams’ liquid chemicals, pressurized gases, asphalt and dry bulk transportation subsidiary, traveled 7.48 million miles during Q4 and 24.2 million miles for the full year 2020, compared to 4.67 million miles during Q4 2019 and 20.5 million miles for full year 2019.
Adams ended 2020 with a combined owned or leased fleet across GulfMark and Service Transport of 566 tractors and 1,103 trailers.
“Contributing to our performance for the fourth quarter was improved economic conditions and the acquisition of two complementary businesses (CTL Transportation and Victoria Express Pipeline) during 2020 that materially expanded our operating footprint and placed us in a stronger position for continued growth,” Roycraft said. “I want to thank all of our employees once again for their tireless efforts as we safely serve our customers. We look forward to operating in an improved macro-environment during 2021.”
Additionally, Adams reported investing $1.4 million in equipment during Q4 2020, and $5 million for the full year, which included the purchase of 17 tractors.
The acquisition of CTL added 163 tractors and 328 trailers to the Service Transport fleet.
“Our focus for 2021 is to continue to prudently expand our core businesses, drive further operating efficiencies and further enhance the quality of our assets,” Roycraft concluded. “The purchases of assets from CTL and the Victoria Express Pipeline and related terminal facilities were key milestones for Adams, and we plan to leverage our expanded footprint as we capitalize on multiple initiatives to grow our customer base and service offerings. Consistent with these recent transactions, we also look forward to identifying and executing on new growth opportunities that are adjacent and complementary to our existing operations.
“Supporting our strategic efforts to expand the business will be our continued focus on ensuring we maintain a healthy balance sheet and strong financial position. This has served us well in the past and will help drive our future success as we provide our customers unsurpassed service and reliability, and deliver long-term value for our shareholders.”
