Adams Resources & Energy, which includes GulfMark Energy and Service Transport Company, reported neat earnings of $4.7 million on revenues of $486.7 million for the second quarter of 2021.
That was up from earnings of $3.5 million on revenues of $152.3 million in Q2 2020.
“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,” said Kevin J. Roycraft, Adams’ chief executive officer. “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.”
GulfMark, Adam’s crude oil marketing subsidiary, marketed approximately 89,585 barrels per day (bpd) of crude oil during the second quarter this year, compared to 81,152 bpd during the same period last year, and 82,889 bpd during the first quarter of 2021.
GulfMark held 413,973 barrels of crude oil inventory at June 30, compared to 421,759 barrels at Dec. 31, 2020.
The collective fleet of 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.
“Looking to the second half of 2021, we remain focused on increasing efficiencies in each of our business segments,” Roycraft said. “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.”
Additional highlights of Adams’ Q2 2021 earnings report include:
- 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 for the second quarter of 2021, compared to an adjusted net loss of $0.8 million for the second quarter of 2020.
- Adjusted cash flow for the second quarter of 2021 was $7.4 million vs. $1.9 million for the second quarter of 2020.