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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): August 7, 2008

WORLD FUEL SERVICES CORPORATION
(Exact name of registrant as specified in its charter)

Florida

1-9533

59-2459427

(State or other jurisdiction of

incorporation)

(Commission File Number)

(I.R.S. Employer

Identification No.)

9800 N.W. 41st Street, Suite 400

Miami, Florida

 

33178

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (305) 428-8000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.     Results of Operations and Financial Condition

Item 7.01.     Regulation FD Disclosure

The following information is provided pursuant to Item 7.01 of Form 8-K, “Regulation FD Disclosure” and Item 2.02 of Form 8-K, “Results of Operations and Financial Condition.”

On August 7, 2008, World Fuel Services Corporation issued a press release reporting its financial results for the second quarter of 2008.  A copy of the press release is attached hereto as Exhibit 99.1.

This information and the information contained in Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933 as amended, or the Exchange Act, except as may be expressly set forth by specific reference in any such filing. 

Item 9.01.     Financial Statements and Exhibits

(d)       Exhibits

 

Exhibit No.

Description

99.1 Press Release dated August 7, 2008.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date:

August 7, 2008

 

World Fuel Services Corporation

 

 

 

 

/s/ Ira M. Birns

 

Ira M. Birns

 

Executive Vice President and Chief Financial

Officer

Exhibit 99.1

World Fuel Services Corporation Reports Record Results for the Second Quarter of 2008

Marine and Aviation Segments Deliver Record Gross Profit

MIAMI--(BUSINESS WIRE)--World Fuel Services Corporation (NYSE:INT), a global leader in the marketing and sale of marine, aviation and land fuel products and related services, today reported second quarter GAAP net income of $20.5 million, ($0.72 and $0.71 per share on a basic and diluted basis, respectively), compared to $17.0 million ($0.61 and $0.58 per share on a basic and diluted basis, respectively), in the second quarter of 2007. Non-GAAP net income for the second quarter, which excludes share-based compensation and amortization of acquired intangible assets, was $22.8 million ($0.79 and $0.78 per share on a basic and diluted basis, respectively), compared to $18.7 million, ($0.67 and $0.64 per share on a basic and diluted basis, respectively), in the second quarter of 2007. A reconciliation of GAAP to non-GAAP results has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below under the heading “Non-GAAP Financial Measures.”

The company’s aviation segment generated record gross profit of $45.2 million, an increase of 29% from the prior quarter and an increase of 47% year-over-year. “During a quarter of significant market turmoil, our aviation segment delivered solid results. Our core aviation business as well as the recently acquired AVCARD business performed well despite a very difficult operating environment,” said Paul H. Stebbins, chairman and chief executive officer of World Fuel Services Corporation.

The company’s marine segment generated record gross profit of $44.4 million, an increase of 20% from the prior quarter and 76% year-over-year. “Our marine segment has now generated year-over-year increases in gross profit for fourteen out of the last fifteen quarters and again posted record results. In our land segment, we completed the Texor acquisition during the second quarter, which doubles our land volumes and significantly improves the financial profile of our land segment going forward,” stated Michael J. Kasbar, president and chief operating officer.

Non-GAAP Financial Measures

This press release includes selected financial information that has not been prepared in accordance with GAAP. This information includes non-GAAP net income and non-GAAP basic and diluted earnings per share. The non-GAAP financial measures exclude costs associated with share-based compensation and amortization of acquired intangible assets, primarily because they are non-cash expenses that we do not believe are reflective of ongoing operating results. We believe that these non-GAAP financial measures allow for greater transparency in the review of our financial and operational performance and are useful for investors to evaluate our ongoing 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. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measure. As previously mentioned, a reconciliation of GAAP to non-GAAP results has been provided in the financial statement tables included in this press release.

Information Relating to Forward-Looking Statements

With the exception of historical information in this news release, this document includes forward-looking statements that involve risks and uncertainties, including, but not limited to, quarterly fluctuations in results, the management of growth, fluctuations in world oil prices or foreign currency, major changes in political, economic, regulatory, or environmental conditions, the loss of key customers, suppliers or key members of senior management, uninsured losses, competition, credit risk associated with accounts and notes receivable, and other risks detailed from time to time in the Company’s Securities and Exchange Commission filings. Actual results may differ materially from any forward-looking statements set forth herein.

About World Fuel Services Corporation

Headquartered in Miami, Florida, World Fuel Services Corporation is a global leader in the marketing and sale of marine, aviation and land fuel products and related services. World Fuel Services provides fuel and related services at more than 2,500 airports, seaports and tanker truck loading terminals in over 190 countries around the world. With 44 offices (including satellite offices) strategically located throughout the world, World Fuel Services offers its customers a value-added outsource service for the supply, quality control, logistical support and price risk management of marine, aviation and land fuel.

The Company’s global team of market makers provides deep domain expertise in all aspects of marine, aviation and land fuel management. World Fuel Services’ marine customers include international container and tanker fleets and time-charter operators, as well as the United States and foreign governments. Aviation customers include commercial airlines, cargo carriers and corporate clientele, as well as the United States and foreign governments. Land customers include petroleum distributors, retail petroleum operators, and industrial, commercial and government accounts. For more information, call (305) 428-8000 or visit http://www.wfscorp.com.

WORLD FUEL SERVICES CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE DATA)
 
  For the Three Months Ended   For the Six Months Ended
June 30, June 30,
2008   2007 2008   2007
 
Revenue $ 5,651,118 $ 3,273,359 $ 10,142,604 $ 5,975,568
Cost of revenue   5,556,796     3,215,371     9,974,473     5,866,412  
     
Gross profit   94,322     57,988     168,131     109,156  
 
Operating expenses:
Compensation and employee benefits 35,380 21,843 64,878 44,528
Provision for bad debt 8,147 (313 ) 10,057 (700 )
General and administrative   20,973     14,392     41,053     26,311  
 
  64,500     35,922     115,988     70,139  
 
Income from operations 29,822 22,066 52,143 39,017
 
Interest and other income, net   (2,744 )   1,552     (4,968 )   2,325  
 
Income before income taxes 27,078 23,618 47,175 41,342
Provision for income taxes   6,502     6,506     10,704     9,345  
 
20,576 17,112 36,471 31,997
Minority interest in income of
consolidated subsidiaries   28     124     170     180  
 
Net income $ 20,548   $ 16,988   $ 36,301   $ 31,817  
 
Basic earnings per share $ 0.72   $ 0.61   $ 1.28   $ 1.14  
 
Basic weighted average shares   28,551     28,061     28,420     28,028  
 
Diluted earnings per share $ 0.71   $ 0.58   $ 1.26   $ 1.09  
 
Diluted weighted average shares   28,931     29,103     28,857     29,107  
WORLD FUEL SERVICES CORPORATION
CONSOLIDATED BALANCE SHEETS
(UNAUDITED - IN THOUSANDS)
  As of
June 30,   December 31,
2008 2007
ASSETS
CURRENT ASSETS:
  Cash and cash equivalents $ 54,729 $ 36,151
Restricted cash 10,000
Short-term investments 8,100 8,100
Accounts receivable, net 1,858,732 1,370,656
Inventories 134,785 103,029
Short-term derivative instruments 179,168 86,531
Prepaid expenses and other current assets   85,590   50,841
  Total current assets 2,321,104 1,665,308
PROPERTY AND EQUIPMENT, NET 37,917 36,870
OTHER ASSETS   217,631   95,868
  $ 2,576,652 $ 1,798,046
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term debt $ 4,788 $ 53
Accounts payable 1,439,053 1,066,971
Short-term derivative instruments 172,477 88,302
Accrued expenses and other current liabilities   118,703   75,785
Total current liabilities 1,735,021 1,231,111
LONG-TERM LIABILITIES 301,332 83,058
SHAREHOLDERS' EQUITY   540,299   483,877
$ 2,576,652 $ 1,798,046

 

World Fuel Services Corporation and Subsidiaries
Consolidated Statements of Cash Flows
(UNAUDITED - IN THOUSANDS)
 

For the Three Months Ended

 

 

For the Six Months Ended

June 30, June 30,
2008   2007 2008   2007
Cash flows from operating activities:
  Net income $ 20,548   $ 16,988   $ 36,301   $ 31,817  

Adjustments to reconcile net income to net cash provided by operating activities:

    Provision for bad debt 8,147 (313 ) 10,057 (700 )
Depreciation and amortization 3,028 1,430 5,898 2,762
Deferred income tax benefit (5,632 ) (1,293 ) (6,132 ) (1,417 )

Share-based payment compensation costs for employees and non-employee directors

2,212 1,828 3,885 3,657
Unrealized (gains) losses from derivatives and related hedged items, net (2,140 ) (296 ) (3,552 ) 41
Other non-cash operating (credits) charges (6 ) (138 ) 230 (187 )
Changes in assets and liabilities, net of acquisitions:
Assets:
Accounts receivable (202,866 ) (118,730 ) (469,353 ) (144,519 )
Inventories (14,274 ) (21,305 ) (29,395 ) (10,148 )
Short-term derivative instruments (89,999 ) 3,004 (86,600 ) (7,037 )
Prepaid expenses and other current assets (17,807 ) (8,209 ) (31,784 ) (14,488 )
Long-term derivative instruments (14,175 ) - (14,093 ) -
Non-current income tax receivable and other assets (169 ) (916 ) (1,188 ) (1,389 )
Liabilities:
Accounts payable 97,038 155,021 358,862 166,138
Short-term derivative instruments 92,155 (2,980 ) 83,135 9,660
Customer deposits 22,192 12,600 30,945 20,829
Accrued expenses and other current liabilities 3,401 (783 ) 7,332 (14,014 )
Long-term derivative instruments 14,527 - 14,527 -

 

Non-current income tax payable, deferred compensation, and other long-term liabilities

  640     (1,181 )   2,330     295  
Total adjustments   (103,728 )   17,739     (124,896 )   9,483  
Net cash (used in) provided by operating activities   (83,180 )   34,727     (88,595 )   41,300  
Cash flows from investing activities:
Capital expenditures (1,425 ) (4,526 ) (5,413 ) (7,130 )
Purchase of short-term investments - (5,002 ) - (20,060 )
Proceeds from the sale of short-term investments - 32,510 - 32,560
Acquisition of business, net of cash acquired   (93,366 )   -     (93,366 )   -  
Net cash (used in) provided by investing activities   (94,791 )   22,982     (98,779 )   5,370  
Cash flows from financing activities:
Dividends paid on common stock (1,065 ) (1,063 ) (2,150 ) (2,126 )
Minority interest distribution - (426 ) (147 ) (426 )
Borrowings under senior revolving credit facility 725,000 - 1,379,000 -
Repayments under senior revolving credit facility (573,000 ) - (1,187,000 ) -
Proceeds from exercise of stock options 1,094 197 1,847 626

Purchases of stock tendered by employees to satisfy the required withholding taxes related to share-based awards

(133 ) (568 ) (387 ) (939 )

Federal and state tax benefits resulting from tax deductions in excess of the compensation cost recognized for share-based awards

4,695 - 4,695 -
Restricted cash - - 10,000 (10,000 )
Other   93     193     94     287  
Net cash provided by (used in) financing activities   156,684     (1,667 )   205,952     (12,578 )
Net increase in cash and cash equivalents (21,287 ) 56,042 18,578 34,092
Cash and cash equivalents, at beginning of period   76,016     154,545     36,151     176,495  
Cash and cash equivalents, at end of period $ 54,729   $ 210,587   $ 54,729   $ 210,587  
WORLD FUEL SERVICES CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE DATA)
 
      For the Three Months Ended   For the Six Months Ended
June 30, June 30,
2008   2007 2008   2007
Non-GAAP financial measures and reconciliation:
 
GAAP net income $ 20,548 $ 16,988 $ 36,301 $ 31,817
Stock-based compensation expense, net of taxes 1,525 1,252 2,650 2,493
Intangible asset amortization expense, net of taxes   705   437   1,273   735
Non-GAAP net income $ 22,778 $ 18,677 $ 40,224 $ 35,045
 
GAAP earnings per basic share $ 0.72 $ 0.61 $ 1.28 $ 1.14
Stock-based compensation expense, net of taxes 0.05 0.04 0.09 0.09
Intangible asset amortization expense, net of taxes   0.02   0.02   0.04   0.03
Non-GAAP basic earnings per share $ 0.79 $ 0.67 $ 1.41 $ 1.26
 
GAAP diluted earnings per share $ 0.71 $ 0.58 $ 1.26 $ 1.09
Stock-based compensation expense, net of taxes 0.05 0.04 0.09 0.09
Intangible asset amortization expense, net of taxes   0.02   0.02   0.04   0.03
Non-GAAP diluted earnings per share $ 0.78 $ 0.64 $ 1.39 $ 1.21

CONTACT:
World Fuel Services Corporation, Miami
Ira M. Birns, Executive Vice President &
Chief Financial Officer
or
Francis X. Shea, Executive Vice President &
Chief Risk and Administrative Officer
305-428-8000