Will Significantly Expand Land Segment in the United Kingdom
MIAMI--(BUSINESS WIRE)--Jan. 6, 2014--
World Fuel Services Corporation (NYSE: INT), announced today that a
wholly-owned subsidiary of the company has signed a definitive agreement
to acquire Watson Petroleum Limited, a leading distributor of gasoline,
diesel, heating oil, lubricants and other products and related services
across England and Wales, for a purchase price of £117 million ($191
million). The purchase price will be funded through cash-on-hand and the
company’s existing credit facilities.
Watson Petroleum is headquartered in Brinkworth, England and has 670
employees. With expected 2013 revenue of $2.2 billion, Watson Petroleum
is one of the largest fuel distributors in the United Kingdom.
“We look forward to welcoming the Watson Petroleum team to World Fuel
Services,” said Michael J. Kasbar, president and chief executive officer
of World Fuel Services Corporation. “Combined with our existing land
business in the United Kingdom, this transaction will further solidify
Watson’s position as one of the largest distributors of ground-based
fuels in the United Kingdom and will provide a platform for further
growth in the ground fuels space in the United Kingdom and elsewhere in
Europe.”
“We are very excited to be joining a company with the capabilities and
breadth of products and services of World Fuel. Coupled with World
Fuel’s solid financial foundation, this transaction will allow us to
expand our product and service offerings and further grow our
distribution network,” stated Tony Watson, managing director of Watson
Petroleum Limited.
The transaction is expected to be $0.18 to $0.22 accretive to earnings
on a GAAP basis in the first twelve months. Non-GAAP accretion, which
excludes amortization of acquired intangible assets of approximately
$0.10 per share, is expected to be $0.28 to $0.32 in the first twelve
months.
The transaction is subject to customary regulatory consents and closing
conditions and is expected to be completed within the next ninety days.
Information Relating to Forward-Looking Statements
With the exception of historical information in this news release, this
document includes forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including statements
regarding our expectations about Watson Petroleum’s 2013 revenue, the
effect of the transaction on its position as a distributor in the United
Kingdom, its opportunities for growth and expansion of offerings, as
well as our expectations about the timing of closing, the funding of the
purchase price, and the effect of the transaction on our earnings. 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 21,
2013. Actual results may differ materially from any forward-looking
statements due to risks and uncertainties, including, but not limited
to: our ability to effectively integrate and derive benefits from the
acquired business, our ability to capitalize on new market
opportunities, unexpected delays in closing, potential liabilities and
the extent of any insurance coverage, the impact of quarterly
fluctuations in results, the creditworthiness of our customers and
counterparties and our ability to collect accounts receivable,
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, 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 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.
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 amortization of
acquired intangible assets, primarily because we do not believe it is
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 for
investors to evaluate our core operating results and trends.
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.
About World Fuel Services Corporation
Headquartered in Miami, Florida, World Fuel Services is a leading global
fuel logistics company, principally engaged in the marketing, sale and
distribution of aviation, marine and land fuel products and related
services on a worldwide basis. 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, 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.
Source: World Fuel Services Corporation
World Fuel Services Corporation
Ira M. Birns, 305-428-8000
Executive
Vice President & Chief Financial Officer
