Vertex Energy (VTNR) investor relations material

Executive summary

• Q2 2024 was marked by a net loss of $53.8 million, or $0.58 per share, with Adjusted EBITDA at $(22.4) million, reflecting a 28% drop in crack spreads and challenging macroeconomic conditions.

• The company completed the transition of the Mobile Refinery hydrocracker from renewable diesel to conventional fuels, ceasing renewable production at the end of June, with expected contributions from conventional operations in Q4 2024.

• Revenue for Q2 2024 was $750.1 million, up $15.2 million year-over-year, driven by increased refined product and service revenues, despite declines in certain segments.

• Operational focus remained on safety and efficiency, with continued strong HS&E performance and a minor OSHA recordable injury.

• Liquidity was enhanced by securing $15 million and $20 million new loans, modifying term loan agreements, and appointing a Chief Restructuring Officer.

Financial highlights

• Q2 2024 revenue was $750.1 million (Q2 2023: $734.9 million); gross profit was $0.2 million (Q2 2023: $-1.4 million).

• Net loss attributable to shareholders was $53.8 million, improved from $81.4 million in Q2 2023, mainly due to lower interest expense and reduced operating costs.

• Adjusted EBITDA for Q2 2024 was $(22.4) million, compared to $(34.2) million in Q2 2023.

• Cash and equivalents at June 30, 2024, were $18.9 million; net debt was $284.9 million.

• Working capital deficit as of June 30, 2024, was $218.2 million, primarily due to reclassification of term loan to current liability.

Outlook and guidance

• Q3 2024 Mobile Refinery throughput expected at 55,000–60,000 bpd (73%–80% capacity), with OpEx per barrel projected at $5.52–$6.02 and capital expenditures of $15–$20 million.

• Yield of high-value finished products projected at 64–68% for Q3.

• Planned turnaround and hydrocracker conversion in Q3 will impact throughput, with margin improvement expected in Q4.

• Management is actively seeking to refinance the term loan and reduce costs; ability to continue as a going concern depends on successful refinancing or capital raising.