Will Expand Commercial and Industrial Distribution Platform in the Land
Segment
MIAMI--(BUSINESS WIRE)--Jun. 23, 2016--
World Fuel Services Corporation (NYSE: INT), today announced that a
wholly-owned subsidiary of the company has signed definitive agreements
to acquire two U.S. land fuel distributors: PAPCO, Inc. (“PAPCO”), which
services retail, commercial and industrial customers with fuel,
price-risk management products, and fleet card solutions throughout the
Mid-Atlantic region of the United States and Associated Petroleum
Products, Inc. (“APP”), which provides fuel and related services to
agricultural, automotive, construction, and commercial and industrial
customers in the Pacific Northwest. The aggregate purchase price for
both companies will be approximately $230 million and will be funded
through the company’s existing credit facilities.
PAPCO is headquartered in Virginia Beach, VA, with 150 employees and
2015 revenue of $1 billion and APP is headquartered in Tacoma, WA, with
275 employees and 2015 revenue of $600 million. Both are leading
distributors of gasoline, diesel, lubricants, propane and related
services in their respective regions.
“The acquisitions of PAPCO and APP significantly expand our geographic
reach and supply and distribution capabilities, while further
strengthening our commercial and industrial distribution platform in the
United States,” stated Michael J. Kasbar, chairman and chief executive
officer of World Fuel Services Corporation. “We look forward to
welcoming the PAPCO and APP teams to the World Fuel Services
organization.”
“We are pleased to have these two industry-leading companies,
established management teams and enthusiastic employees, join World
Fuel. This transaction expands our extensive supply relationships and
product offerings as we continue to grow our diversified business,” said
Michael Crosby, executive vice president, global land for World Fuel
Services Corporation.
Excluding the impact of one-time acquisition related expenses and
amortization of acquired intangible assets of approximately $4 million
and $9 million respectively, the transactions are expected to be $0.22
to $0.26 accretive to earnings on a Non-GAAP basis in the first twelve
months.
The transactions are subject to customary closing conditions and are
expected to be completed within the next 45 days.
Non-GAAP Financial Measures
This press release includes selected financial information that has not
been prepared in accordance with accounting principles generally
accepted in the United States (“GAAP”). Specifically, we have used
non-GAAP accretion to earnings per share, which excludes one-time
acquisition-related expenses and amortization of acquired intangible
assets, primarily because we do not believe they are reflective of the
company’s core operating results. We believe that this non-GAAP
financial measure, when considered in conjunction with our financial
information prepared in accordance with GAAP, is useful to investors to
further aid in evaluating the ongoing financial performance of the
Company and to provide greater transparency as supplemental information
to our GAAP results. Non-GAAP financial measures should not be
considered in isolation from, or as a substitute for, financial
information prepared in accordance with GAAP. In addition, our
presentation of non-GAAP accretion may not be comparable to the
presentation of such metric by other companies. Investors are encouraged
to review the reconciliation of this non-GAAP measure to its most
directly comparable GAAP financial measure contained in this press
release.
Information Relating to Forward-Looking Statements
This release includes forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995, including
statements regarding our expectations about the effect of the
acquisitions on our land segment, our geographic reach and distribution
capabilities, the expansion of supply relationships and product
offerings and the effect of the transaction on our earnings, as well as
our expectations about the timing for closing and funding of the
purchase price. These forward-looking statements are qualified in their
entirety by cautionary statements and risk factor disclosures contained
in the company’s Securities and Exchange Commission (“SEC”) filings,
including the company’s Annual Report on Form 10-K filed with the SEC on
February 16, 2016. Actual results may differ materially from any
forward-looking statements due to risks and uncertainties, including,
but not limited to: our ability to obtain required consents and satisfy
closing conditions, our ability to effectively integrate and derive
benefits from the acquisitions, our ability to capitalize on new market
opportunities, potential liabilities, limited indemnities and the extent
of any insurance coverage, the outcome of pending litigation and other
proceedings, the impact of quarterly fluctuations in results, the
creditworthiness of our customers and counterparties and our ability to
collect accounts receivable, environmental and other risks associated
with the storage, transportation and delivery of petroleum products, our
failure to effectively hedge certain financial risks associated with the
use of derivatives, non-performance by counterparties or customers on
derivatives contracts, loss of, or reduced sales, to a significant
government customer, uninsured losses, the failure of fuel and other
products we sell to meet specifications, fluctuations in world oil
prices or foreign currency, changes in political, economic, regulatory,
or environmental conditions, adverse conditions in the markets or
industries in which we or our customers and suppliers operate, the
impact of natural disasters, adverse results in legal disputes,
unanticipated tax liabilities, our ability to retain and attract senior
management and other key employees and other risks detailed from time to
time in the company’s SEC filings. New risks emerge from time to time
and it is not possible for management to predict all such risk factors
or to assess the impact of such risks on our business. Accordingly, we
undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, changes in
expectations, future events, or otherwise.
About World Fuel Services Corporation
Headquartered in Miami, Florida, World Fuel Services is a global fuel
logistics, transaction management and payment processing company,
principally engaged in the distribution of fuel and related products and
services in the aviation, marine and land transportation industries.
World Fuel Services sells fuel and delivers services to its clients at
more than 8,000 locations in more than 200 countries and territories
worldwide.
The company's global team of market makers provides deep domain
expertise in all aspects of aviation, marine and land fuel management.
Aviation customers include commercial airlines, cargo carriers, private
aircraft and fixed base operators (FBOs), as well as the United States
and foreign governments. World Fuel Services' marine customers include
international container and tanker fleets, cruise lines and time-charter
operators, as well as the United States and foreign governments. Land
customers include petroleum distributors, retail petroleum operators,
and industrial, commercial, residential and government accounts. The
company also offers transaction management services which consist of
card payment solutions and merchant processing services to customers in
the aviation, marine and land transportation industries. For more
information, call 305-428-8000 or visit www.wfscorp.com.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160623005299/en/
Source: World Fuel Services Corporation
World Fuel Services Corporation
Ira M. Birns, 305-428-8000
Executive
Vice President & Chief Financial Officer
or
Glenn Klevitz,
305-428-8000
Vice President, Assistant Treasurer
