World Fuel Services Corp. (NYSE:INT) Q2 2019 Earnings Conference Call - Final Transcript

Jul 25, 2019 • 05:00 pm ET


World Fuel Services Corp. (NYSE:INT) Q2 2019 Earnings Conference Call - Final Transcript


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Michael J. Kasbar

impact of a warm spring in the UK and a decline in North American supply and trading results.

The ongoing expansion of our strategically important commercial and industrial fuel operations and the momentum of our global Kinect gas and power activity confirm that our strategy is increasingly relevant in navigating a changing energy marketplace. Our global land segment remains on track to grow at double-digit rates this year and is supposed to continue increasing our value as a strategic partner to existing and prospective customers.

Our MultiService global payment solutions business turned another solid quarter, recording yet another double-digit earnings gain, reflecting a continued increase in transaction volumes and demonstrating the scalability of our processing platform. The MultiService team continues to onboard and ramp new customers, which will further leverage the installed multi-tenant payment infrastructure.

Before turning the call over to Ira, I'd like to thank our over 5,000 team members for their professionalism and dedication. Our people are indisputably our competitive advantage, and their focus on our strategic objectives has never been clearer. I'll pause now and ask Ira to review our financial results

Ira M. Birns

Thanks for pausing, Mike. Good afternoon, everyone. We delivered solid financial results in the second quarter and continued to execute on our core strategies of continuous cost management and sharpening our portfolio to drive enhanced returns.

Before I get into the details of the second quarter, some of the highlights are as follows: Adjusted EBITDA for the second quarter was $98 million. That's an increase of $14 million or 17% compared to last year. We have now delivered year-over-year increases in adjusted EBITDA for nine consecutive quarters, and our trailing 12-month adjusted EBITDA has increased to a record $388 million. Adjusted earnings per share for the quarter was $0.58, an increase of 23% compared to the second quarter of last year. And lastly, our balance sheet remains strong, aided by operating cash flow generation during the quarter of $125 million. We repurchased $65 million of common stock during the quarter, and, as previously announced, increased our dividend by 66%.

And as we announced earlier this week, we have amended and extended our bank facility, further improving our liquidity profile, providing us with additional financial flexibility to continue investing in our business and returning capital to our shareholders.

Consolidated revenue for the second quarter was $9.5 billion, down $700 million or 7% compared to the second quarter of 2018. The year-over-year decrease in revenue was principally driven by the decline in volumes in our marine and land segments as well as the 12% year-over-year decline in average fuel prices.

Our aviation segment volume was 2.1 billion gallons in the second quarter, an increase of 50 million gallons or 3% year-over-year and 173 million gallons or 9% sequentially. Volume in our marine segment for the second quarter was 5.1 million metric tons, which is down 775,000 tons compared to the second quarter of last year and effectively flat sequentially. The volume reduction year-over-year principally related to the