Third Quarter revenues rise 40% to a record $29
million, EBITDA up 171% to $7.22 million, EPS increases to
$0.09
RTS Oil Holdings, Inc. (OTC BB: RTSO), a leading wholesale,
retail and refining provider of petroleum products in Kazakhstan,
today announced its results for the third quarter and year-to-date
period ended December 31, 2013.
Third Quarter 2013 Highlights
- Revenue of $29 million, up 40% from
$20.7 million in Q3 2012
- Gross margin of 26.9% of revenue,
compared to 14.3% for the same period in the prior year
- Adjusted EBITDA of $7.22 million, up
171% compared to $2.66 million in Q3 2012
- EPS of $0.09, from a loss of ($0.01) in
the comparable prior year period
Nine Months Ended December 31, 2013 Highlights
- Revenue of $69.6 million, up 20% from
$60.0 million during the first nine months of 2012
- Gross margin of 22.3% of revenue,
compared to 15.1% for the same period in the prior year
- Adjusted EBITDA of $13.67 million, or
19.6% of sales, compared to $8.13 million, or 13.5% of sales in the
first three quarters of 2012
- EPS of $0.11, up from ($0.03) in the
comparable prior year period
Rafael Zaemonovich Gavrielov, CEO of RTS Oil, commented, “We
recorded record sales, EBITDA and earnings for the third quarter of
2013 reflecting the leverage in our business model and the progress
we have made operationally. We have also diversified our product
offerings in the Petroleum market which positions the company for
additional growth opportunities going forward on top of our core
market growth.”
Results for the Three and Nine Months Ended December 31,
2013
Revenues for the three months ended December 31, 2013, increased
40% to $29.0 million compared to $20.73 million during the
comparable prior period in 2012. The increase in revenues was
primarily due to the increased sales volume of petrol products from
our wholesale operations, coupled with increase of retail
prices.
Crude oil and product purchases for the three months ended
December 31, 2013, were $21.2 million, compared to $17.8 million
during the comparable prior period in 2012. The increase in crude
oil and product purchases was primarily due to the increase in
revenues. The amount of the increase is partially off-set because
the Company purchased certain inventory products at discounted
prices due to having advances to suppliers outstanding for an
extended period of time. Gross margin as a percentage of sales
increased to 26.9% compared to 14.3% in the prior year’s third
quarter.
Selling, general and administrative expenses for the three
months ended December 31, 2013, were $655,000 compared to $590,000
for the comparable prior period in 2012. Selling, general and
administrative expenses include compensation, professional
services, marketing expenses, utilities, maintenance materials and
services, and other support costs. The increase was related to an
increase in the write-off of certain uncollectable balances
partially offset by the decrease in certain expense categories such
as third-party service expenditures and bank fees.
Net income increased for the three months ended December 31,
2013, to $2.8 million, compared to a loss of ($400,000) for the
three months ended December 31, 2012. Basic and diluted net income
per common share for the three months ended December 31, 2013, and
2012, were $0.09 and ($0.01), respectively.
Adjusted EBITDA for the third quarter of 2013 was $7.22 million
compared to $2.66 million for the same period in 2012.
Nine Months Ended December 31, 2013
Revenues for the nine months ended December 31, 2013, increased
20% to $69.6 million compared to $60.0 million during the
comparable prior period in 2012. The increase in revenues was
primarily due to an increase in sales from wholesale operations and
an increase of retail prices partially offset by the decrease in
sales from petrol stations.
Crude oil and product purchases for the nine months ended
December 31, 2013, were $54.1 million, compared to $49.2 million
during the comparable prior period in 2012. The increase in crude
oil and product purchases was primarily due to the increase in
revenues. The amount of the increase is partially off-set because
the Company purchased certain inventory products at discounted
prices due to having advances to suppliers outstanding for an
extended period of time. Gross margin as a percentage of sales
increased to 22.3% compared to 15.1% during the comparable prior
period in 2012.
Selling, general and administrative expenses for the nine months
ended December 31, 2013, were $2.2 million, compared to $1.2
million for the comparable prior period in 2012. Selling, general
and administrative expenses include compensation, professional
services, marketing expenses, utilities, maintenance materials and
services, and other support costs. The increase was primarily
related to the additional professional expenditures incurred during
the current period in connection with initial and continual
expenditures related to public company filings in fiscal 2013.
Net income increased to $3.5 million for the nine months ended
December 31, 2013, compared to a loss of ($1.1) million for the
prior year period. Basic and diluted net income per common share
for the nine months ended December 31, 2013, and 2012, were $0.11
and ($0.03), respectively.
Adjusted EBITDA for the nine months ended December 31, 2013, was
$13.67 million compared to $8.13 million for the same period in
2012.
About RTS Oil Holdings, Inc.
RTS Oil Holdings, Inc. (OTC BB: RTSO), through its RTS
subsidiary, operates 19 gasoline stations and seven (7) crude oil
and fuel terminals (“fuel tank farms”). Of the seven (7) fuel tank
farms, RTS owns one (1) fuel tank farm and leases six (6) others
with total storage capacity of more than 40,000 tons of crude oil
and refined oil products. RTS leases the gasoline stations under
operating lease agreements with related parties. RTS also owns a
fleet of 28 trucks with capacities ranging from 20 to 34 tons of
diesel/gasoline. Refined products are sold wholesale to other
distributors and retail via RTS gasoline stations. RTS also
supplies furnace fuel to refineries in the Kyrgyz republic for
further processing. We own and operate an oil refinery in Karatau,
Kazakhstan, that refines crude oil into diesel fuel, gasoline, and
mazut, a heating oil; and we operate 20 petrol stations and seven
(7) crude oil and fuel terminals with a total capacity of 40,000
tons (approximately 280,000 barrels, or 11.8 million gallons) in
southern Kazakhstan. The Company’s Sinur subsidiary owns and
operates a modern, environmentally friendly oil refinery in
Karatau, Kazakhstan. Using new, advanced technology, this
strategically located facility refines crude oil into diesel fuel,
gasoline, and mazut, a heating oil.
Disclaimers:
Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA
We report our financial results in accordance with generally
accepted accounting principles in the United States (“GAAP”). We
also provide certain non-GAAP financial measures—Adjusted EBITDA
and EBITDA. We present Adjusted EBITDA because we believe that it
is an important supplemental measure relating to our financial
condition. We use Adjusted EBITDA because we believe our investors
are familiar with Adjusted EBITDA and that consistency in
presentation of EBITDA-related measures is helpful to
investors.
EBITDA is defined as income before interest expense, provision
for income taxes, and depreciation and amortization. Adjusted
EBITDA is defined as EBITDA, further adjusted by certain non-cash
charges. Our presentation of Adjusted EBITDA has limitations as an
analytical tool. Adjusted EBITDA is not a measure of liquidity or
profitability and should not be considered as an alternative to net
income, operating income, net cash provided by operating activities
or any other measure determined in accordance with GAAP.
Additionally, Adjusted EBITDA is not intended to be a measure of
cash flow for management’s discretionary use, as it does not
consider debt service requirements, capital expenditures or other
non-discretionary expenditures that are not deducted from the
measure.
We caution investors that our presentation of Adjusted EBITDA
and EBITDA may not be comparable to similarly titled measures of
other companies.
FORWARD-LOOKING STATEMENT
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. In some cases, you can identify forward-looking statements
by the following words: “anticipate,” “believe,” “continue,”
“could,” “estimate,” “expect,” “intend,” “may,” “ongoing,” “plan,”
“potential,” “predict,” “project,” “should,” “will,” “would,” or
the negative of these terms or other comparable terminology,
although not all forward-looking statements contain these words.
Forward-looking statements are not a guarantee of future
performance or results, and will not necessarily be accurate
indications of the times at, or by, which such performance or
results will be achieved. Forward-looking statements are based on
information available at the time the statements are made and
involve known and unknown risks, uncertainties and other factors
that may cause our results, levels of activity, performance or
achievements to be materially different from the information
expressed or implied by the forward-looking statements in this
press release. This press release should be considered in light of
all filings of the Company that are contained in the Edgar Archives
of the Securities and Exchange Commission at www.sec.gov.
Hayden IR.Cameron Donahue,
1-651-707-3532cameron@haydenir.com
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