Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 01, 2017 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | ADAMS RESOURCES & ENERGY, INC. | |
Entity Central Index Key | 2,178 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 4,217,596 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2017 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
REVENUES: | ||
Marketing | $ 288,615 | $ 236,394 |
Transportation | 13,455 | 13,347 |
Oil and natural gas operations | 1,017 | 790 |
Total revenues | 303,087 | 250,531 |
COSTS AND EXPENSES: | ||
Marketing | 285,153 | 229,057 |
Transportation | 12,162 | 11,189 |
Oil and natural gas operations | 750 | 631 |
General and administrative | 2,637 | 2,200 |
Depreciation, depletion and amortization | 3,969 | 5,115 |
Total cost and expenses | 304,671 | 248,192 |
Operating (loss) earnings | (1,584) | 2,339 |
Other income (expense): | ||
Interest income | 159 | 103 |
Interest expense | (1) | 0 |
Loss (earnings) before income taxes and equity investments | (1,426) | 2,442 |
Income tax benefit (provision) | 566 | (888) |
(Loss) earnings before equity investments | (860) | 1,554 |
(Loss) from equity investments, net of tax benefit of zero and $67, respectively | 0 | (124) |
Net (loss) earnings | $ (860) | $ 1,430 |
(LOSS) EARNINGS PER SHARE: | ||
Basic and diluted net (loss) earnings per common share (in dollars per share) | $ (0.20) | $ 0.34 |
DIVIDENDS PER COMMON SHARE (in dollars per share) | $ 0.22 | $ 0.22 |
UNAUDITED CONDENSED CONSOLIDAT3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract] | ||
Tax benefit from equity investment | $ 0 | $ 67 |
UNAUDITED CONDENSED CONSOLIDAT4
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 98,073 | $ 87,342 |
Accounts receivable, net of allowance for doubtful accounts of $233 and $225, respectively | 89,122 | 87,162 |
Inventory | 20,627 | 13,070 |
Fair value contracts | 468 | 112 |
Income tax receivable | 3,471 | 2,735 |
Prepayments | 1,353 | 2,097 |
Total current assets | 213,114 | 192,518 |
Property and Equipment | ||
Marketing | 56,511 | 56,907 |
Transportation | 70,767 | 70,849 |
Oil and gas (successful efforts method) | 64,063 | 62,784 |
Other | 107 | 108 |
Property and equipment | 191,448 | 190,648 |
Less - Accumulated depreciation, depletion and amortization | (147,639) | (144,323) |
Net property and equipment | 43,809 | 46,325 |
Other Assets: | ||
Investments | 2,500 | 2,500 |
Cash deposits and other | 4,740 | 5,529 |
Total assets | 264,163 | 246,872 |
Current Liabilities: | ||
Accounts payable | 97,978 | 79,897 |
Accounts payable - related party | 56 | 53 |
Fair value contracts | 0 | 64 |
Accrued and other liabilities | 7,303 | 6,060 |
Total current liabilities | 105,337 | 86,074 |
Other Liabilities: | ||
Asset retirement obligations | 2,090 | 2,329 |
Deferred taxes and other liabilities | 7,212 | 7,157 |
Total liabilities | 114,639 | 95,560 |
Commitments and Contingencies (Note 5) | ||
Shareholders' Equity: | ||
Preferred stock - $1.00 par value, 960,000 shares authorized, none outstanding | 0 | 0 |
Common stock - $.10 par value, 7,500,000 shares authorized, 4,217,596 shares outstanding | 422 | 422 |
Contributed capital | 11,693 | 11,693 |
Retained earnings | 137,409 | 139,197 |
Total shareholders' equity | 149,524 | 151,312 |
Liabilities and shareholders' equity | $ 264,163 | $ 246,872 |
UNAUDITED CONDENSED CONSOLIDAT5
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Allowance for doubtful accounts | $ 233 | $ 225 |
Shareholders' Equity: | ||
Preferred stock - par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock - shares authorized (in shares) | 960,000 | 960,000 |
Preferred stock - shares outstanding (in shares) | 0 | 0 |
Common stock - par value (in dollars per share) | $ 0.10 | $ 0.10 |
Common stock - shares authorized (in shares) | 7,500,000 | 7,500,000 |
Common stock - shares outstanding (in shares) | 4,217,596 | 4,217,596 |
UNAUDITED CONDENSED CONSOLIDAT6
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
CASH PROVIDED BY OPERATIONS: | ||
Net (loss) earnings | $ (860) | $ 1,430 |
Adjustments to reconcile net earnings to net cash from operating activities - | ||
Depreciation, depletion and amortization | 3,969 | 5,115 |
Property sales loss (gains) | 7 | (120) |
Impairment of oil and natural gas properties | 3 | 29 |
Deferred income taxes | 60 | (1,352) |
Net change in fair value contracts | (420) | 158 |
Equity investment losses | 0 | 191 |
(Increase) in accounts receivable | (1,968) | (1,224) |
(Increase) in inventories | (7,557) | (5,707) |
Decrease (increase) in income tax receivable | (736) | 1,958 |
Decrease in prepayments | 744 | 338 |
Increase (decrease) in accounts payable | 17,746 | (3,614) |
Increase in accrued liabilities | 1,084 | 393 |
Other changes, net | 78 | 47 |
Net cash provided by (used in) operating activities | 12,150 | (2,358) |
INVESTING ACTIVITIES: | ||
Property and equipment additions | (1,006) | (4,210) |
Proceeds from property sales | 39 | 920 |
Investments | 0 | (2,200) |
Insurance and state collateral (deposits) refunds | 476 | (2) |
Net cash used in investing activities | (491) | (5,492) |
FINANCING ACTIVITIES | ||
Dividend payments | (928) | (928) |
Net cash used in financing activities | (928) | (928) |
Increase (decrease) in cash and cash equivalents | 10,731 | (8,778) |
Cash and cash equivalents at beginning of period | 87,342 | 91,877 |
Cash and cash equivalents at end of period | $ 98,073 | $ 83,099 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2017 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | Note 1 - Basis of Presentation The accompanying unaudited condensed consolidated financial statements, in the opinion of Adams Resources & Energy, Inc., a Delaware corporation, and its wholly owned subsidiaries (collectively, the ‟Company”) management, include all adjustments (consisting of normal recurring accruals) necessary for the fair presentation of its financial position at March 31, 2017, its results of operations for the three months ended March 31, 2017 and 2016 and its cash flows for the three months ended March 31, 2017 and 2016. Certain information and note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles (‟GAAP”) have been condensed or omitted pursuant to Securities and Exchange Commission rules and regulations. Although the Company believes the disclosures made are adequate to make the information presented not misleading, it is suggested that these unaudited condensed consolidated financial statements be read in conjunction with the financial statements, and the notes thereto, included in the Company's latest Annual Report on Form 10-K. The interim statement of operations is not necessarily indicative of results to be expected for a full year. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2017 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 - Summary of Significant Accounting Policies Nature of Operations and Principles of Consolidation The Company is engaged in the business of crude oil marketing, tank truck transportation of liquid chemicals and dry bulk, and oil and gas exploration and production. The accompanying unaudited condensed consolidated financial statements include the accounts of the Company after elimination of all intercompany accounts and transactions. Cash and Cash Equivalents Cash and cash equivalents include any Treasury bill, commercial paper, money market fund or federal funds with maturity of 90 days or less. Cash and cash equivalents are maintained with major financial institutions and such deposits may exceed the amount of federally backed insurance provided. While the Company regularly monitors the financial stability of such institutions, cash and cash equivalents ultimately remain at risk subject to the financial viability of such institutions. Inventory Inventory consists of crude oil held in storage tanks and at third-party pipelines as part of the Company’s crude oil marketing operations. Crude oil inventory is carried at the lower of average cost or “net realizable value”. Prepayments The components of prepayments are as follows (in thousands): March 31, December 31, 2017 2016 Insurance premiums $ 767 $ 1,403 Rents, license and other 586 694 $ 1,353 $ 2,097 Property and Equipment Expenditures for major renewals and betterments are capitalized, and expenditures for maintenance and repairs are expensed as incurred. Interest costs incurred in connection with major capital expenditures are capitalized and amortized over the lives of the related assets. When properties are retired or sold, the related cost and accumulated depreciation, depletion and amortization is removed from the accounts and any gain or loss is reflected in earnings. Oil and gas exploration and development expenditures are accounted for in accordance with the successful efforts method of accounting. Direct costs of acquiring developed or undeveloped leasehold acreage, including lease bonus, brokerage and other fees, are capitalized. Exploratory drilling costs are initially capitalized until the properties are evaluated and determined to be either productive or nonproductive. Such evaluations are made on a quarterly basis. If an exploratory well is determined to be nonproductive, the costs of drilling the well are charged to expense. Costs incurred to drill and complete development wells, including dry holes, are capitalized. As of March 31, 2017, the Company had no unevaluated or suspended exploratory drilling costs. Depreciation, depletion and amortization of the cost of proved oil and gas properties is calculated using the unit-of-production method. The reserve base or denominator used to calculate depreciation, depletion and amortization for leasehold acquisition costs and the cost to acquire proved properties is the sum of proved developed reserves and proved undeveloped reserves. For lease and well equipment, development costs and successful exploration drilling costs, the reserve base includes only proved developed reserves. The numerator for such calculations is actual production volumes for the period. All other property and equipment is depreciated using the straight-line method over the estimated average useful lives of three to twenty years. The Company reviews its long-lived assets for impairment whenever there is evidence that the carrying value of such assets may not be recoverable. Any impairment recognized is permanent and may not be restored. Producing oil and gas properties are reviewed on a field-by-field basis. Fields with carrying values in excess of their estimated undiscounted future net cash flows are deemed impaired. For properties requiring impairment, the fair value is estimated based on an internal discounted cash flow model. Cash flows are developed based on estimated future production and prices are then discounted using a market based rate of return consistent with that used by the Company in evaluating cash flows for other assets of a similar nature. On a quarterly basis, management evaluates the carrying value of non-producing oil and gas leasehold properties and may deem them impaired based on remaining lease term, area drilling activity and the Company’s plans for the property. This fair value measure depends highly on management’s assessment of the likelihood of continued exploration efforts in a given area. Therefore, such data inputs are categorized as ‟unobservable” or ‟Level 3” inputs. (See ‟Fair Value Measurements” below). Importantly, this fair value measure only applies to the write-down of capitalized costs and will never result in an increase to reported earnings. Impairment provisions are included in oil and gas segment operating losses and were as follows (in thousands): Three Months Ended March 31, 2017 2016 Producing property impairments $ - $ 1 Non-producing property impairments 3 28 Total $ 3 $ 29 Since the Company is no longer the operator of its oil and gas property interests, it does not maintain the underlying detail acreage data and the Company is dependent on the operator when determining which specific acreage will ultimately be drilled. However, the capitalized cost detail on a property-by-property basis is reviewed by management, and deemed impaired if development is not anticipated prior to lease expiration. Onshore leasehold periods are normally three years and may contain renewal options. Investments In December 2015 the Company formed a new wholly owned subsidiary, Adams Resources Medical Management, Inc. (ARMM), and in January 2016 ARMM acquired a 30% member interest in Bencap LLC (Bencap) for a $2.2 million cash payment. Bencap provides medical insurance brokerage and medical claims auditing services to employers utilizing ERISA governed employee benefit plans. The Company has accounted for this investment under the equity method of accounting. During the third quarter of 2016, the Company completed a review of its equity method investment in Bencap and determined there was an other than temporary impairment. Underlying this was the terms of the investment agreement where Bencap had the option to request borrowings up to $1.5 million (on or after December 5, 2016 but before October 31, 2018) that the Company must provide or forfeit its 30% member interest. During the third quarter of 2016, management of the Company determined that it was unlikely to provide additional funding due to Bencap’s lower than projected revenue growth and operating losses since investment inception. As a result, the Company recognized a net loss of $1.4 million from its investment in Bencap as of September 30, 2016. This loss included a pre-tax impairment charge of $1.7 million and pre-tax losses from the equity method investment of $0.5 million. In February 2017, Bencap requested additional funding of approximately $0.5 million and the Company declined the additional funding request and forfeited its 30% member interest in BenCap. In April 2016 the Company, through its ARMM subsidiary, acquired an approximate 15% equity interest (less than 3% voting interest) in VestaCare, Inc., a California corporation (“VestaCare”), for a $2.5 million cash payment. VestaCare provides an array of software as a service (“SaaS”) electronic payment technologies to medical providers, payers and patients including VestaCare’s most recent product offering, VestaPay™. VestaPay™ allows medical care providers to structure fully automated and dynamically updating electronic payment plans for their patients. The Company has accounted for this investment under the cost method of accounting for investments. The Company does not currently have any plans to pursue additional medical-related investments. The Company’s remaining investment in VestaCare, Inc. is considered a long-lived asset and will be reviewed for impairment whenever there is evidence that the carrying value of such asset may not be recoverable. These fair value measures depend highly on management’s assessment of the financial status of the underlying operation. Such data inputs are “unobservable” or “Level 3” inputs. Cash Deposits and Other Assets The Company has established certain deposits to support participation in its liability insurance program and remittance of state crude oil severance taxes and other state collateral deposits. Insurance collateral deposits are invested at the discretion of the Company’s insurance carrier and such investments primarily consist of intermediate term federal government bonds and bonds backed by federal agencies. This fair value measure relies on inputs from quoted prices for similar assets and is thus categorized as a ‟Level 2” valuation in the fair value hierarchy. Components of cash deposits and other assets are as follows (in thousands): March 31, December 31, 2017 2016 Insurance collateral deposits $ 4,222 $ 5,032 State collateral deposits 141 143 Materials and supplies 377 354 $ 4,740 $ 5,529 Revenue Recognition Certain commodity purchase and sale contracts utilized by the Company’s marketing business qualify as derivative instruments with certain specifically identified contracts also designated as trading activity. From the time of contract origination, such trading activity contracts are marked-to-market and recorded on a net revenue basis in the accompanying financial statements. Most crude oil purchase contracts and sale contracts qualify and are designated as non-trading activities and the Company considers such contracts as normal purchases and sales activity. For normal purchases and sales, the Company’s customers are invoiced monthly based upon contractually agreed upon terms with revenue recognized in the month in which the physical product is delivered to the customer. Such sales are recorded gross in the financial statements because the Company takes title, has risk of loss for the products, is the primary obligor for the purchase, establishes the sale price independently with a third party and maintains credit risk associated with the sale of the product. Certain crude oil contracts may be with a single counterparty to provide for similar quantities of crude oil to be bought and sold at different locations. These contracts are entered into for a variety of reasons, including effecting the transportation of the commodity, to minimize credit exposure, and/or to meet the competitive demands of the customer. Such buy/sell arrangements are reflected on a net revenue basis in the accompanying unaudited condensed consolidated financial statements. Reporting such crude oil contracts on a gross revenue basis would increase the Company’s reported revenues as follows (in thousands): Three Months Ended March 31, 2017 2016 Revenue gross-up $ 57,565 $ 75,927 Transportation segment customers are invoiced, and the related revenue is recognized, as the service is provided. Oil and gas revenue from the Company’s interests in producing wells is recognized as title and physical possession of the oil and gas passes to the purchaser. Sales of Long-lived assets Gains and losses from the sale or disposal of long-lived assets that do not meet the criteria for presentation as a discontinued operation are presented in the accompanying financial statements as a component of operating earnings. Concentration of Credit Risk The Company’s largest customers consist of large multinational integrated oil companies and independent refiners of crude oil. In addition, the Company transacts business with independent oil producers, major chemical concerns, crude oil trading companies and a variety of commercial energy users. Within this group of customers the Company generally derives approximately 50 percent of its revenues from three to five crude oil refining concerns. While the Company has ongoing established relationships with certain domestic refiners of crude oil, alternative markets are readily available since the Company supplies less than one percent of U.S. domestic refiner demand. As a fungible commodity delivered to various supply points, the Company’s crude oil sales can be readily delivered to alternative end markets. Management believes that a loss of any of those customers where the Company currently derives more than 10 percent of its revenues would not have a material adverse effect on the Company’s operations. Accounts receivable associated with crude oil activities comprise approximately 90 percent of the Company’s total receivables and industry practice requires payment for such sales to occur within 20 days of the end of the month following a transaction. The Company’s customer makeup, credit policies and the relatively short duration of receivables mitigate the uncertainty typically associated with receivables management. Letter of Credit Facility The Company maintains a Credit and Security Agreement with Wells Fargo Bank to provide up to a $60 million stand-by letter of credit facility used to support crude oil purchases within the marketing segment. This facility is collateralized by the eligible accounts receivable within the segment and outstanding amounts were as follows (in thousands): Three Months Ended March 31, 2017 2016 Stand-by letters of credit $ - $ 1,000 The issued stand-by letters of credit are cancelled as the underlying purchase obligations are satisfied by cash payment when due. The letter of credit facility places certain restrictions on Gulfmark Energy, Inc. the Company’s wholly owned subsidiary. Such restrictions include the maintenance of a combined 1.1 to 1.0 current ratio and the maintenance of positive net earnings excluding inventory valuation changes, as defined, among other restrictions. The Company is currently in compliance with all such financial covenants. Statement of Cash Flows There were no significant non-cash financing activities in any of the periods reported. Statements of cash flow disclosure items include the following (in thousands): Three Months Ended March 31, 2017 2016 Federal and state tax paid $ 14 $ 105 Capitalized amounts included in property and equipment that were not included in amounts reported for cash additions in the Statements of Cash Flows for the applicable report dates were as follows (in thousands): March 31, 2017 2016 Property and equipment additions $ 836 $ 350 Earnings Per Share Earnings per share are based on the weighted average number of shares of common stock and potentially dilutive common stock shares outstanding during the period presented herein. The weighted average number of shares outstanding was 4,217,596 for 2017 and 2016. There were no potentially dilutive securities during those periods. Share-Based Payments During the periods presented herein, the Company had neither stock-based employee compensation plans nor any other share-based payment arrangements. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Examples of significant estimates used in the accompanying consolidated financial statements include oil and gas reserve volumes forming the foundation for calculating depreciation, depletion and amortization and for estimating cash flows when assessing impairment triggers and when estimating values associated with oil and gas properties. Other examples include revenue accruals, the provision for bad debts, insurance related accruals, income tax permanent and timing differences, contingencies and valuation of fair value contracts. Income Taxes Income taxes are accounted for using the asset and liability method. Under this approach, deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax basis. Use of Derivative Instruments The Company’s marketing segment is involved in the purchase and sale of crude oil. The Company seeks to profit by procuring the commodity as it is produced and then delivering the material to the end users or the intermediate use marketplace. As typical for the industry, such transactions are made pursuant to the terms of forward month commodity purchase and/or sale contracts. Some of these contracts meet the definition of a derivative instrument, and therefore, the Company accounts for such contracts at fair value, unless the normal purchase and sale exception is applicable. Such underlying contracts are standard for the industry and are the governing document for the Company’s crude oil marketing segment. None of the Company’s derivative instruments have been designated as hedging instruments. The accounting methodology utilized by the Company for its commodity contracts is further discussed below under the caption ‟Fair Value Measurements”. The estimated fair value of forward month commodity contracts (derivatives) is reflected in the accompanying Unaudited Condensed Consolidated Balance Sheet as of March 31, 2017 as follows (in thousands): Balance Sheet Location and Amount Current Other Current Other Assets Assets Liabilities Liabilities Asset Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation $ 750 $ - $ - $ - Liability Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation - - 282 - Less Counterparty Offsets (282 ) - (282 ) - As Reported Fair Value Contracts $ 468 $ - $ - $ - As of March 31, 2017, four commodity purchase and sale contracts comprise the Company’s derivative valuations. These contracts encompass 145,000 barrels of crude oil during April 2017 through May 2017. Forward month commodity contracts (derivatives) are reflected in the accompanying Unaudited Condensed Consolidated Balance Sheet as of December 31, 2016 as follows (in thousands): Balance Sheet Location and Amount Current Other Current Other Assets Assets Liabilities Liabilities Asset Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation $ 378 $ - $ - $ - Liability Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation - - 330 - Less Counterparty Offsets (266 ) - (266 ) - As Reported Fair Value Contracts $ 112 $ - $ 64 $ - As of December 31, 2016, two contracts comprised the Company’s derivative valuations. These contracts encompass approximately 65 barrels per day of diesel fuel during January through March 2017 and 145,000 barrels of crude oil during January 2017 through April 2017. The Company only enters into commodity contracts with creditworthy counterparties and evaluates its exposure to significant counterparties on an ongoing basis. As of March 31, 2017 and December 31, 2016, the Company was not holding nor has it posted any collateral to support its forward month fair value derivative activity. The Company is not subject to any credit-risk related trigger events. The Company has no other financial investment arrangements that would serve to offset its derivative contracts. Forward month commodity contracts (derivatives) are reflected in the accompanying Unaudited Condensed Consolidated Statement of Operations for the three months ended March 31, 2017 and 2016 as follows (in thousands): Earnings (Loss) Three Months Ended March 31, 2017 2016 Revenues – Marketing $ 420 $ 158 Fair Value Measurements The carrying amount reported in the consolidated balance sheet for cash and cash equivalents, accounts receivable and accounts payable approximates fair value because of the immediate or short-term maturity of these financial instruments. Marketable securities are recorded at fair value based on market quotations from actively traded liquid markets. Fair value contracts consist of derivative financial instruments and are recorded as either an asset or liability measured at its fair value. Changes in fair value are recognized immediately in earnings unless the derivatives qualify for, and the Company elects, cash flow hedge accounting. The Company had no contracts designated for hedge accounting during any current reporting periods. Fair value estimates are based on assumptions that market participants would use when pricing an asset or liability and the Company uses a fair value hierarchy of three levels that prioritizes the information used to develop those assumptions. Currently, for all items presented herein, the Company utilizes a market approach to valuing its contracts. On a contract by contract, forward month by forward month basis, the Company obtains observable market data for valuing its contracts. The fair value hierarchy gives the highest priority to quoted prices in active markets and the lowest priority to unobservable data. The fair value hierarchy is summarized as follows: Level 1 – quoted prices in active markets for identical assets or liabilities that may be accessed at the measurement date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. For Level 1 valuation of marketable securities, the Company utilizes market quotations provided by its primary financial institution and for the valuation of derivative financial instruments the Company utilizes the New York Mercantile Exchange (‟NYMEX”) for such valuations. Level 2 – (a) quoted prices for similar assets or liabilities in active markets, (b) quoted prices for identical assets or liabilities but in markets that are not actively traded or in which little information is released to the public, (c) observable inputs other than quoted prices and (d) inputs derived from observable market data. Source data for Level 2 inputs include information provided by the NYMEX, published price data and indices, third party price survey data and broker provided forward price statistics. Level 3 – unobservable market data inputs for assets or liabilities. As of March 31, 2017, the Company’s fair value assets and liabilities are summarized and categorized as follows (in thousands): Market Data Inputs Gross Level 1 Gross Level 2 Gross Level 3 Counterparty Quoted Prices Observable Unobservable Offsets Total Derivatives - Current assets $ - $ 750 $ - $ (282 ) $ 468 - Current liabilities - (282 ) - 282 - Net Value $ - $ 468 $ - $ - $ 468 As of December 31, 2016, the Company’s fair value assets and liabilities are summarized and categorized as follows (in thousands): Market Data Inputs Gross Level 1 Gross Level 2 Gross Level 3 Counterparty Quoted Prices Observable Unobservable Offsets Total Derivatives - Current assets $ - $ 378 $ - $ (266 ) $ 112 - Current liabilities - (330 ) - 266 (64 ) Net Value $ - $ 48 $ - $ - $ 48 When determining fair value measurements, the Company makes credit valuation adjustments to reflect both its own nonperformance risk and its counterparty’s nonperformance risk. When adjusting the fair value of derivative contracts for the effect of nonperformance risk, the impact of netting and any applicable credit enhancements, considered. Credit valuation adjustments utilize Level 3 inputs, such as credit scores to evaluate the likelihood of default by the Company or its counterparties. As of March 31, 2017 and December 31, 2016, credit valuation adjustments were not significant to the overall valuation of the Company’s fair value contracts. As a result, applicable fair value assets and liabilities are included in their entirety in the fair value hierarchy. Recent Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which supersedes the revenue recognition requirements in “Revenue Recognition (Topic 605).” Topic 606 is based on the core principle that revenue is recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. Topic 606 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. Topic 606 is effective for fiscal years beginning after December 15, 2017, and interim periods within those years, with early adoption permitted in 2017; however we do not plan to adopt the standard early. Entities will have the option to apply the standard using a full retrospective or modified retrospective adoption method. The Company has not yet selected a transition method. The Company has a team in place to analyze the impact of Update 2014-09, and the related ASU's, across all revenue streams to evaluate the impact of the new standard on revenue contracts. This includes reviewing current accounting policies and practices to identify potential differences that would result from applying the requirements under the new standard. Our evaluation of the impact on our Consolidated Financial Statements and related disclosures is ongoing and not complete. The Company is continuing our review of contracts relative to the provisions of Topic 606. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” This standard requires, among other things, that lessees recognize the following for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Lessees and lessors must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company expects to adopt this standard in the first quarter of 2019 and is currently evaluating the impact of this standard on our Consolidated Financial Statements and related disclosures. In connection with our assessment work, The Company has a team in place to analyze the impact of ASU 2016-02 In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” This standard is intended to reduce existing diversity in practice in how certain transactions are presented on the statement of cash flows. The standard is effective for interim and annual reporting periods beginning after December 15, 2017, although early adoption is permitted. The guidance requires application using a retrospective transition method. The Company adopted ASU No. 2016-15 in the first quarter of 2017 and has determined the amendment does not have a material impact on our Consolidated Financial Statements and related disclosures. Management believes the impact of other recently issued standards and updates, which are not yet effective, will not have a material impact on the Company’s consolidated financial position, results of operations, or cash flows upon adoption. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 3 – Segment Reporting The Company’s three reporting segments are crude oil marketing, tank truck transportation of liquid chemicals and dry bulk, and oil and gas exploration and production. Information concerning the Company's various business activities is summarized as follows (in thousands): - Three Month Comparison Segment Depreciation Property and Operating (Loss) Depletion and Equipment Revenues Earnings Amortization Additions Period Ended March 31, 2017 Marketing $ 288,615 $ 1,393 $ 2,069 $ 82 Transportation 13,455 (298 ) 1,591 102 Oil and gas 1,017 (42 ) 309 822 $ 303,087 $ 1,053 $ 3,969 $ 1,006 Period Ended March 31, 2016 Marketing $ 236,394 $ 4,648 $ 2,689 $ 263 Transportation 13,347 173 1,985 3,817 Oil and gas 790 (282 ) 441 130 $ 250,531 $ 4,539 $ 5,115 $ 4,210 Segment operating earnings reflect revenues net of operating costs and depreciation, depletion and amortization and are reconciled to earnings from continuing operations before income taxes, as follows (in thousands): Three Months Ended March 31, 2017 2016 Segment operating earnings $ 1,053 $ 4,539 - General and administrative (2,637 ) (2,200 ) Operating (loss) earnings (1,584 ) 2,339 - Interest income 159 103 - Interest expense (1 ) - (Loss) Earnings before income tax $ (1,426 ) $ 2,442 Identifiable assets by industry segment are as follows (in thousands) March 31, December 31, 2017 2016 Marketing $ 114,526 $ 107,257 Transportation 32,231 32,120 Oil and gas 8,167 7,279 Other 109,239 100,216 $ 264,163 $ 246,872 Intersegment sales are insignificant and all sales occurred in the United States. Other identifiable assets are primarily corporate cash, corporate accounts receivable, investments and properties not identified with any specific segment of the Company’s business. Accounting policies for transactions between reportable segments are consistent with applicable accounting policies as disclosed herein. |
Transactions with Affiliates
Transactions with Affiliates | 3 Months Ended |
Mar. 31, 2017 | |
Transactions with Affiliates [Abstract] | |
Transactions with Affiliates | Note 4 - Transactions with Affiliates The late Mr. K. S. Adams, Jr., former Chairman of the Board of the Company, and certain of his family partnerships and affiliates have participated as working interest owners with the Company’s wholly owned subsidiary, Adams Resources Exploration Corporation (‟AREC”) Mr. Adams and the affiliates participated on terms similar to those afforded other non-affiliated working interest owners. While the affiliates have generally maintained their existing property interest, they have not participated in any such transactions originating after the death of Mr. Adams in October 2013. In connection with the operation of certain oil and gas properties, the Company also charges such related parties for administrative overhead primarily as prescribed by the Council of Petroleum Accountants Society Bulletin 5. The Company also enters into certain transactions in the normal course of business with other affiliated entities including direct cost reimbursement for shared phone and administrative services. In addition, the Company leases office space from an affiliated entity based on a lease rental rate determined by an independent appraisal. The Company utilizes its former affiliate, Bencap, to administer certain of its employee medical benefit programs including a detail audit of individual medical claims. See Note (1) to the accompanying financials under the caption “Investments” for further discussion. Bencap earns a fee from the Company for providing such services at a discounted amount from its standard charge to non-affiliates. In February 2017, Bencap requested additional funding of approximately $0.5 million and the Company declined the additional funding request, resulting in forfeiture of the investment. Activities with affiliates were as follows (in thousands): Three Months Ended March 31, 2017 2016 Overhead recoveries $ - $ 21 Affiliate billings to company $ 12 $ 11 Company billings to affiliates $ 1 $ 1 Rentals paid to affiliate $ 167 $ 163 Fees paid to Bencap $ 108 $ 36 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | Note 5 - Commitments and Contingencies Under the Company’s automobile and workers’ compensation insurance policies, the Company can either receive a return of premium paid or be assessed for additional premiums up to pre-established limits. Additionally, in certain instances the risk of insured losses is shared with a group of similarly situated entities. The Company has appropriately recognized estimated expenses and liabilities related to these policies for losses incurred but not reported to the Company or its insurance carrier as follows (in thousands): March 31, December 31, 2017 2016 Estimated expenses and liabilities $ 2,504 $ 2,657 The Company maintains a self-insurance program for managing employee medical claims. A liability for expected claims incurred but not reported is established on a monthly basis. As claims are paid, the liability is relieved. The Company also maintains third party insurance stop-loss coverage for aggregate medical claims exceeding $4.5 million. Medical accrual amounts are as follows (in thousands): March 31, December 31, 2017 2016 Accrued medical claims $ 1,923 $ 1,411 Adams Resources Exploration Corporation (“AREC”) is named as a defendant in a number of Louisiana lawsuits involving alleged environmental contamination from prior drilling operations. Such suits typically allege improper disposal of oilfield wastes in earthen pits, with one matter involving allegations that drilling operations in 1986 contributed to the formation of a sinkhole in 2012 (the “Sinkhole Cases”). The Sinkhole Cases, while arising from a singular event, include a number of different lawsuits brought in Louisiana State Court and one consolidated action in the United States District Court for the Eastern District of Louisiana. In addition to the Sinkhole Cases, AREC is currently involved in two other such suits. These suits are styled LePetit Chateau Deluxe v. Adams Resources Exploration Corporation dated March 2004, and Henning Management, LLC v. Adams Resources Exploration Corporation dated November 2013. Each suit involves multiple industry defendants with substantially larger proportional interest in the properties. In addition, the Sinkhole Cases involve a number of defendants in the solution mining industry, in which AREC has never participated. In the LePetit Chateau Deluxe matter, all the larger defendants have settled the case. The plaintiffs in each of these matters are seeking unspecified compensatory and punitive damages. While management does not believe that a material adverse effect on the Company will result from the claims, significant attorney fees may be incurred by AREC to address claims related to these suits. As of March 31, 2017 and December 31, 2016, the Company has accrued $0.5 million of future legal/or settlement costs for these matters. From time to time as incidental to its operations, the Company may become involved in various lawsuits and/or disputes. Primarily as an operator of an extensive trucking fleet, the Company is a party to motor vehicle accidents, worker compensation claims and other items of general liability as would be typical for the industry. Management of the Company is presently unaware of any claims against the Company that are either outside the scope of insurance coverage or that may exceed the level of insurance coverage and could potentially represent a material adverse effect on the Company’s financial position or results of operations. |
Subsequent Event
Subsequent Event | 3 Months Ended |
Mar. 31, 2017 | |
Subsequent Event [Abstract] | |
Subsequent Event | Note 6 – Subsequent Event On April 21, 2017, AREC, a wholly owned subsidiary of the Company, filed a petition under Chapter 11 of the United States Bankruptcy Code in the Bankruptcy Court for the District of Delaware, Case Number 17-10866(KG). AREC will continue to operate its business as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provision of the Bankruptcy Code and orders of the Bankruptcy Court. As of March 31, 2017, the estimated net realizable value of the oil and gas assets is anticipated to be greater than the net book value. The Company will continue to evaluate the estimated net realizable value until the sale process has concluded. Adams Resources & Energy, Inc. is the primary creditor in the Chapter 11 process. On May 3, 2017, AREC filed a Motion with the Bankruptcy Court for approval of an auction process and engagement of Oil & Gas Asset Clearinghouse to conduct the auction. Over the past few years, the Company has de-emphasized its upstream operations and does not expect this Chapter 11 filing by its subsidiary to have a material adverse impact on any of its core businesses. |
Summary of Significant Accoun13
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Summary of Significant Accounting Policies [Abstract] | |
Nature of Operations and Principles of Consolidation | Nature of Operations and Principles of Consolidation The Company is engaged in the business of crude oil marketing, tank truck transportation of liquid chemicals and dry bulk, and oil and gas exploration and production. The accompanying unaudited condensed consolidated financial statements include the accounts of the Company after elimination of all intercompany accounts and transactions. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include any Treasury bill, commercial paper, money market fund or federal funds with maturity of 90 days or less. Cash and cash equivalents are maintained with major financial institutions and such deposits may exceed the amount of federally backed insurance provided. While the Company regularly monitors the financial stability of such institutions, cash and cash equivalents ultimately remain at risk subject to the financial viability of such institutions. |
Inventory | Inventory Inventory consists of crude oil held in storage tanks and at third-party pipelines as part of the Company’s crude oil marketing operations. Crude oil inventory is carried at the lower of average cost or “net realizable value”. |
Prepayments | Prepayments The components of prepayments are as follows (in thousands): March 31, December 31, 2017 2016 Insurance premiums $ 767 $ 1,403 Rents, license and other 586 694 $ 1,353 $ 2,097 |
Property and Equipment | Property and Equipment Expenditures for major renewals and betterments are capitalized, and expenditures for maintenance and repairs are expensed as incurred. Interest costs incurred in connection with major capital expenditures are capitalized and amortized over the lives of the related assets. When properties are retired or sold, the related cost and accumulated depreciation, depletion and amortization is removed from the accounts and any gain or loss is reflected in earnings. Oil and gas exploration and development expenditures are accounted for in accordance with the successful efforts method of accounting. Direct costs of acquiring developed or undeveloped leasehold acreage, including lease bonus, brokerage and other fees, are capitalized. Exploratory drilling costs are initially capitalized until the properties are evaluated and determined to be either productive or nonproductive. Such evaluations are made on a quarterly basis. If an exploratory well is determined to be nonproductive, the costs of drilling the well are charged to expense. Costs incurred to drill and complete development wells, including dry holes, are capitalized. As of March 31, 2017, the Company had no unevaluated or suspended exploratory drilling costs. Depreciation, depletion and amortization of the cost of proved oil and gas properties is calculated using the unit-of-production method. The reserve base or denominator used to calculate depreciation, depletion and amortization for leasehold acquisition costs and the cost to acquire proved properties is the sum of proved developed reserves and proved undeveloped reserves. For lease and well equipment, development costs and successful exploration drilling costs, the reserve base includes only proved developed reserves. The numerator for such calculations is actual production volumes for the period. All other property and equipment is depreciated using the straight-line method over the estimated average useful lives of three to twenty years. The Company reviews its long-lived assets for impairment whenever there is evidence that the carrying value of such assets may not be recoverable. Any impairment recognized is permanent and may not be restored. Producing oil and gas properties are reviewed on a field-by-field basis. Fields with carrying values in excess of their estimated undiscounted future net cash flows are deemed impaired. For properties requiring impairment, the fair value is estimated based on an internal discounted cash flow model. Cash flows are developed based on estimated future production and prices are then discounted using a market based rate of return consistent with that used by the Company in evaluating cash flows for other assets of a similar nature. On a quarterly basis, management evaluates the carrying value of non-producing oil and gas leasehold properties and may deem them impaired based on remaining lease term, area drilling activity and the Company’s plans for the property. This fair value measure depends highly on management’s assessment of the likelihood of continued exploration efforts in a given area. Therefore, such data inputs are categorized as ‟unobservable” or ‟Level 3” inputs. (See ‟Fair Value Measurements” below). Importantly, this fair value measure only applies to the write-down of capitalized costs and will never result in an increase to reported earnings. Impairment provisions are included in oil and gas segment operating losses and were as follows (in thousands): Three Months Ended March 31, 2017 2016 Producing property impairments $ - $ 1 Non-producing property impairments 3 28 Total $ 3 $ 29 Since the Company is no longer the operator of its oil and gas property interests, it does not maintain the underlying detail acreage data and the Company is dependent on the operator when determining which specific acreage will ultimately be drilled. However, the capitalized cost detail on a property-by-property basis is reviewed by management, and deemed impaired if development is not anticipated prior to lease expiration. Onshore leasehold periods are normally three years and may contain renewal options. |
Investments | Investments In December 2015 the Company formed a new wholly owned subsidiary, Adams Resources Medical Management, Inc. (ARMM), and in January 2016 ARMM acquired a 30% member interest in Bencap LLC (Bencap) for a $2.2 million cash payment. Bencap provides medical insurance brokerage and medical claims auditing services to employers utilizing ERISA governed employee benefit plans. The Company has accounted for this investment under the equity method of accounting. During the third quarter of 2016, the Company completed a review of its equity method investment in Bencap and determined there was an other than temporary impairment. Underlying this was the terms of the investment agreement where Bencap had the option to request borrowings up to $1.5 million (on or after December 5, 2016 but before October 31, 2018) that the Company must provide or forfeit its 30% member interest. During the third quarter of 2016, management of the Company determined that it was unlikely to provide additional funding due to Bencap’s lower than projected revenue growth and operating losses since investment inception. As a result, the Company recognized a net loss of $1.4 million from its investment in Bencap as of September 30, 2016. This loss included a pre-tax impairment charge of $1.7 million and pre-tax losses from the equity method investment of $0.5 million. In February 2017, Bencap requested additional funding of approximately $0.5 million and the Company declined the additional funding request and forfeited its 30% member interest in BenCap. In April 2016 the Company, through its ARMM subsidiary, acquired an approximate 15% equity interest (less than 3% voting interest) in VestaCare, Inc., a California corporation (“VestaCare”), for a $2.5 million cash payment. VestaCare provides an array of software as a service (“SaaS”) electronic payment technologies to medical providers, payers and patients including VestaCare’s most recent product offering, VestaPay™. VestaPay™ allows medical care providers to structure fully automated and dynamically updating electronic payment plans for their patients. The Company has accounted for this investment under the cost method of accounting for investments. The Company does not currently have any plans to pursue additional medical-related investments. The Company’s remaining investment in VestaCare, Inc. is considered a long-lived asset and will be reviewed for impairment whenever there is evidence that the carrying value of such asset may not be recoverable. These fair value measures depend highly on management’s assessment of the financial status of the underlying operation. Such data inputs are “unobservable” or “Level 3” inputs. |
Cash Deposits and Other Assets | Cash Deposits and Other Assets The Company has established certain deposits to support participation in its liability insurance program and remittance of state crude oil severance taxes and other state collateral deposits. Insurance collateral deposits are invested at the discretion of the Company’s insurance carrier and such investments primarily consist of intermediate term federal government bonds and bonds backed by federal agencies. This fair value measure relies on inputs from quoted prices for similar assets and is thus categorized as a ‟Level 2” valuation in the fair value hierarchy. Components of cash deposits and other assets are as follows (in thousands): March 31, December 31, 2017 2016 Insurance collateral deposits $ 4,222 $ 5,032 State collateral deposits 141 143 Materials and supplies 377 354 $ 4,740 $ 5,529 |
Revenue Recognition | Revenue Recognition Certain commodity purchase and sale contracts utilized by the Company’s marketing business qualify as derivative instruments with certain specifically identified contracts also designated as trading activity. From the time of contract origination, such trading activity contracts are marked-to-market and recorded on a net revenue basis in the accompanying financial statements. Most crude oil purchase contracts and sale contracts qualify and are designated as non-trading activities and the Company considers such contracts as normal purchases and sales activity. For normal purchases and sales, the Company’s customers are invoiced monthly based upon contractually agreed upon terms with revenue recognized in the month in which the physical product is delivered to the customer. Such sales are recorded gross in the financial statements because the Company takes title, has risk of loss for the products, is the primary obligor for the purchase, establishes the sale price independently with a third party and maintains credit risk associated with the sale of the product. Certain crude oil contracts may be with a single counterparty to provide for similar quantities of crude oil to be bought and sold at different locations. These contracts are entered into for a variety of reasons, including effecting the transportation of the commodity, to minimize credit exposure, and/or to meet the competitive demands of the customer. Such buy/sell arrangements are reflected on a net revenue basis in the accompanying unaudited condensed consolidated financial statements. Reporting such crude oil contracts on a gross revenue basis would increase the Company’s reported revenues as follows (in thousands): Three Months Ended March 31, 2017 2016 Revenue gross-up $ 57,565 $ 75,927 Transportation segment customers are invoiced, and the related revenue is recognized, as the service is provided. Oil and gas revenue from the Company’s interests in producing wells is recognized as title and physical possession of the oil and gas passes to the purchaser. |
Sales of Long-lived Assets | Sales of Long-lived assets Gains and losses from the sale or disposal of long-lived assets that do not meet the criteria for presentation as a discontinued operation are presented in the accompanying financial statements as a component of operating earnings. |
Concentration of Credit Risk | Concentration of Credit Risk The Company’s largest customers consist of large multinational integrated oil companies and independent refiners of crude oil. In addition, the Company transacts business with independent oil producers, major chemical concerns, crude oil trading companies and a variety of commercial energy users. Within this group of customers the Company generally derives approximately 50 percent of its revenues from three to five crude oil refining concerns. While the Company has ongoing established relationships with certain domestic refiners of crude oil, alternative markets are readily available since the Company supplies less than one percent of U.S. domestic refiner demand. As a fungible commodity delivered to various supply points, the Company’s crude oil sales can be readily delivered to alternative end markets. Management believes that a loss of any of those customers where the Company currently derives more than 10 percent of its revenues would not have a material adverse effect on the Company’s operations. Accounts receivable associated with crude oil activities comprise approximately 90 percent of the Company’s total receivables and industry practice requires payment for such sales to occur within 20 days of the end of the month following a transaction. The Company’s customer makeup, credit policies and the relatively short duration of receivables mitigate the uncertainty typically associated with receivables management. |
Letter of Credit Facility | Letter of Credit Facility The Company maintains a Credit and Security Agreement with Wells Fargo Bank to provide up to a $60 million stand-by letter of credit facility used to support crude oil purchases within the marketing segment. This facility is collateralized by the eligible accounts receivable within the segment and outstanding amounts were as follows (in thousands): Three Months Ended March 31, 2017 2016 Stand-by letters of credit $ - $ 1,000 The issued stand-by letters of credit are cancelled as the underlying purchase obligations are satisfied by cash payment when due. The letter of credit facility places certain restrictions on Gulfmark Energy, Inc. the Company’s wholly owned subsidiary. Such restrictions include the maintenance of a combined 1.1 to 1.0 current ratio and the maintenance of positive net earnings excluding inventory valuation changes, as defined, among other restrictions. The Company is currently in compliance with all such financial covenants. |
Statement of Cash Flows | Statement of Cash Flows There were no significant non-cash financing activities in any of the periods reported. Statements of cash flow disclosure items include the following (in thousands): Three Months Ended March 31, 2017 2016 Federal and state tax paid $ 14 $ 105 Capitalized amounts included in property and equipment that were not included in amounts reported for cash additions in the Statements of Cash Flows for the applicable report dates were as follows (in thousands): March 31, 2017 2016 Property and equipment additions $ 836 $ 350 |
Earnings Per Share | Earnings Per Share Earnings per share are based on the weighted average number of shares of common stock and potentially dilutive common stock shares outstanding during the period presented herein. The weighted average number of shares outstanding was 4,217,596 for 2017 and 2016. There were no potentially dilutive securities during those periods. |
Share-Based Payments | Share-Based Payments During the periods presented herein, the Company had neither stock-based employee compensation plans nor any other share-based payment arrangements. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Examples of significant estimates used in the accompanying consolidated financial statements include oil and gas reserve volumes forming the foundation for calculating depreciation, depletion and amortization and for estimating cash flows when assessing impairment triggers and when estimating values associated with oil and gas properties. Other examples include revenue accruals, the provision for bad debts, insurance related accruals, income tax permanent and timing differences, contingencies and valuation of fair value contracts. |
Income Taxes | Income Taxes Income taxes are accounted for using the asset and liability method. Under this approach, deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax basis. |
Use of Derivative Instruments | Use of Derivative Instruments The Company’s marketing segment is involved in the purchase and sale of crude oil. The Company seeks to profit by procuring the commodity as it is produced and then delivering the material to the end users or the intermediate use marketplace. As typical for the industry, such transactions are made pursuant to the terms of forward month commodity purchase and/or sale contracts. Some of these contracts meet the definition of a derivative instrument, and therefore, the Company accounts for such contracts at fair value, unless the normal purchase and sale exception is applicable. Such underlying contracts are standard for the industry and are the governing document for the Company’s crude oil marketing segment. None of the Company’s derivative instruments have been designated as hedging instruments. The accounting methodology utilized by the Company for its commodity contracts is further discussed below under the caption ‟Fair Value Measurements”. The estimated fair value of forward month commodity contracts (derivatives) is reflected in the accompanying Unaudited Condensed Consolidated Balance Sheet as of March 31, 2017 as follows (in thousands): Balance Sheet Location and Amount Current Other Current Other Assets Assets Liabilities Liabilities Asset Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation $ 750 $ - $ - $ - Liability Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation - - 282 - Less Counterparty Offsets (282 ) - (282 ) - As Reported Fair Value Contracts $ 468 $ - $ - $ - As of March 31, 2017, four commodity purchase and sale contracts comprise the Company’s derivative valuations. These contracts encompass 145,000 barrels of crude oil during April 2017 through May 2017. Forward month commodity contracts (derivatives) are reflected in the accompanying Unaudited Condensed Consolidated Balance Sheet as of December 31, 2016 as follows (in thousands): Balance Sheet Location and Amount Current Other Current Other Assets Assets Liabilities Liabilities Asset Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation $ 378 $ - $ - $ - Liability Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation - - 330 - Less Counterparty Offsets (266 ) - (266 ) - As Reported Fair Value Contracts $ 112 $ - $ 64 $ - As of December 31, 2016, two contracts comprised the Company’s derivative valuations. These contracts encompass approximately 65 barrels per day of diesel fuel during January through March 2017 and 145,000 barrels of crude oil during January 2017 through April 2017. The Company only enters into commodity contracts with creditworthy counterparties and evaluates its exposure to significant counterparties on an ongoing basis. As of March 31, 2017 and December 31, 2016, the Company was not holding nor has it posted any collateral to support its forward month fair value derivative activity. The Company is not subject to any credit-risk related trigger events. The Company has no other financial investment arrangements that would serve to offset its derivative contracts. Forward month commodity contracts (derivatives) are reflected in the accompanying Unaudited Condensed Consolidated Statement of Operations for the three months ended March 31, 2017 and 2016 as follows (in thousands): Earnings (Loss) Three Months Ended March 31, 2017 2016 Revenues – Marketing $ 420 $ 158 |
Fair Value Measurements | Fair Value Measurements The carrying amount reported in the consolidated balance sheet for cash and cash equivalents, accounts receivable and accounts payable approximates fair value because of the immediate or short-term maturity of these financial instruments. Marketable securities are recorded at fair value based on market quotations from actively traded liquid markets. Fair value contracts consist of derivative financial instruments and are recorded as either an asset or liability measured at its fair value. Changes in fair value are recognized immediately in earnings unless the derivatives qualify for, and the Company elects, cash flow hedge accounting. The Company had no contracts designated for hedge accounting during any current reporting periods. Fair value estimates are based on assumptions that market participants would use when pricing an asset or liability and the Company uses a fair value hierarchy of three levels that prioritizes the information used to develop those assumptions. Currently, for all items presented herein, the Company utilizes a market approach to valuing its contracts. On a contract by contract, forward month by forward month basis, the Company obtains observable market data for valuing its contracts. The fair value hierarchy gives the highest priority to quoted prices in active markets and the lowest priority to unobservable data. The fair value hierarchy is summarized as follows: Level 1 – quoted prices in active markets for identical assets or liabilities that may be accessed at the measurement date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. For Level 1 valuation of marketable securities, the Company utilizes market quotations provided by its primary financial institution and for the valuation of derivative financial instruments the Company utilizes the New York Mercantile Exchange (‟NYMEX”) for such valuations. Level 2 – (a) quoted prices for similar assets or liabilities in active markets, (b) quoted prices for identical assets or liabilities but in markets that are not actively traded or in which little information is released to the public, (c) observable inputs other than quoted prices and (d) inputs derived from observable market data. Source data for Level 2 inputs include information provided by the NYMEX, published price data and indices, third party price survey data and broker provided forward price statistics. Level 3 – unobservable market data inputs for assets or liabilities. As of March 31, 2017, the Company’s fair value assets and liabilities are summarized and categorized as follows (in thousands): Market Data Inputs Gross Level 1 Gross Level 2 Gross Level 3 Counterparty Quoted Prices Observable Unobservable Offsets Total Derivatives - Current assets $ - $ 750 $ - $ (282 ) $ 468 - Current liabilities - (282 ) - 282 - Net Value $ - $ 468 $ - $ - $ 468 As of December 31, 2016, the Company’s fair value assets and liabilities are summarized and categorized as follows (in thousands): Market Data Inputs Gross Level 1 Gross Level 2 Gross Level 3 Counterparty Quoted Prices Observable Unobservable Offsets Total Derivatives - Current assets $ - $ 378 $ - $ (266 ) $ 112 - Current liabilities - (330 ) - 266 (64 ) Net Value $ - $ 48 $ - $ - $ 48 When determining fair value measurements, the Company makes credit valuation adjustments to reflect both its own nonperformance risk and its counterparty’s nonperformance risk. When adjusting the fair value of derivative contracts for the effect of nonperformance risk, the impact of netting and any applicable credit enhancements, considered. Credit valuation adjustments utilize Level 3 inputs, such as credit scores to evaluate the likelihood of default by the Company or its counterparties. As of March 31, 2017 and December 31, 2016, credit valuation adjustments were not significant to the overall valuation of the Company’s fair value contracts. As a result, applicable fair value assets and liabilities are included in their entirety in the fair value hierarchy. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which supersedes the revenue recognition requirements in “Revenue Recognition (Topic 605).” Topic 606 is based on the core principle that revenue is recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. Topic 606 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. Topic 606 is effective for fiscal years beginning after December 15, 2017, and interim periods within those years, with early adoption permitted in 2017; however we do not plan to adopt the standard early. Entities will have the option to apply the standard using a full retrospective or modified retrospective adoption method. The Company has not yet selected a transition method. The Company has a team in place to analyze the impact of Update 2014-09, and the related ASU's, across all revenue streams to evaluate the impact of the new standard on revenue contracts. This includes reviewing current accounting policies and practices to identify potential differences that would result from applying the requirements under the new standard. Our evaluation of the impact on our Consolidated Financial Statements and related disclosures is ongoing and not complete. The Company is continuing our review of contracts relative to the provisions of Topic 606. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” This standard requires, among other things, that lessees recognize the following for all leases (with the exception of short-term leases) at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Lessees and lessors must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company expects to adopt this standard in the first quarter of 2019 and is currently evaluating the impact of this standard on our Consolidated Financial Statements and related disclosures. In connection with our assessment work, The Company has a team in place to analyze the impact of ASU 2016-02 In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” This standard is intended to reduce existing diversity in practice in how certain transactions are presented on the statement of cash flows. The standard is effective for interim and annual reporting periods beginning after December 15, 2017, although early adoption is permitted. The guidance requires application using a retrospective transition method. The Company adopted ASU No. 2016-15 in the first quarter of 2017 and has determined the amendment does not have a material impact on our Consolidated Financial Statements and related disclosures. Management believes the impact of other recently issued standards and updates, which are not yet effective, will not have a material impact on the Company’s consolidated financial position, results of operations, or cash flows upon adoption. |
Summary of Significant Accoun14
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Summary of Significant Accounting Policies [Abstract] | |
Components of prepayments | The components of prepayments are as follows (in thousands): March 31, December 31, 2017 2016 Insurance premiums $ 767 $ 1,403 Rents, license and other 586 694 $ 1,353 $ 2,097 |
Fair value of impairment of provisions | Impairment provisions are included in oil and gas segment operating losses and were as follows (in thousands): Three Months Ended March 31, 2017 2016 Producing property impairments $ - $ 1 Non-producing property impairments 3 28 Total $ 3 $ 29 |
Components of cash deposits and other assets | Components of cash deposits and other assets are as follows (in thousands): March 31, December 31, 2017 2016 Insurance collateral deposits $ 4,222 $ 5,032 State collateral deposits 141 143 Materials and supplies 377 354 $ 4,740 $ 5,529 |
Reporting revenue of crude oil contracts on a gross revenue basis | Reporting such crude oil contracts on a gross revenue basis would increase the Company’s reported revenues as follows (in thousands): Three Months Ended March 31, 2017 2016 Revenue gross-up $ 57,565 $ 75,927 |
Collateralized by eligible accounts receivable and outstanding | This facility is collateralized by the eligible accounts receivable within the segment and outstanding amounts were as follows (in thousands): Three Months Ended March 31, 2017 2016 Stand-by letters of credit $ - $ 1,000 |
Non-cash financing activities | There were no significant non-cash financing activities in any of the periods reported. Statements of cash flow disclosure items include the following (in thousands): Three Months Ended March 31, 2017 2016 Federal and state tax paid $ 14 $ 105 |
Capitalized costs included in property plant and equipment | Capitalized amounts included in property and equipment that were not included in amounts reported for cash additions in the Statements of Cash Flows for the applicable report dates were as follows (in thousands): March 31, 2017 2016 Property and equipment additions $ 836 $ 350 |
Derivatives reflected in the consolidated balance sheet | The estimated fair value of forward month commodity contracts (derivatives) is reflected in the accompanying Unaudited Condensed Consolidated Balance Sheet as of March 31, 2017 as follows (in thousands): Balance Sheet Location and Amount Current Other Current Other Assets Assets Liabilities Liabilities Asset Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation $ 750 $ - $ - $ - Liability Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation - - 282 - Less Counterparty Offsets (282 ) - (282 ) - As Reported Fair Value Contracts $ 468 $ - $ - $ - Forward month commodity contracts (derivatives) are reflected in the accompanying Unaudited Condensed Consolidated Balance Sheet as of December 31, 2016 as follows (in thousands): Balance Sheet Location and Amount Current Other Current Other Assets Assets Liabilities Liabilities Asset Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation $ 378 $ - $ - $ - Liability Derivatives - Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation - - 330 - Less Counterparty Offsets (266 ) - (266 ) - As Reported Fair Value Contracts $ 112 $ - $ 64 $ - |
Derivatives reflected in the consolidated statement of operations | Forward month commodity contracts (derivatives) are reflected in the accompanying Unaudited Condensed Consolidated Statement of Operations for the three months ended March 31, 2017 and 2016 as follows (in thousands): Earnings (Loss) Three Months Ended March 31, 2017 2016 Revenues – Marketing $ 420 $ 158 |
Fair value assets and liabilities | As of March 31, 2017, the Company’s fair value assets and liabilities are summarized and categorized as follows (in thousands): Market Data Inputs Gross Level 1 Gross Level 2 Gross Level 3 Counterparty Quoted Prices Observable Unobservable Offsets Total Derivatives - Current assets $ - $ 750 $ - $ (282 ) $ 468 - Current liabilities - (282 ) - 282 - Net Value $ - $ 468 $ - $ - $ 468 As of December 31, 2016, the Company’s fair value assets and liabilities are summarized and categorized as follows (in thousands): Market Data Inputs Gross Level 1 Gross Level 2 Gross Level 3 Counterparty Quoted Prices Observable Unobservable Offsets Total Derivatives - Current assets $ - $ 378 $ - $ (266 ) $ 112 - Current liabilities - (330 ) - 266 (64 ) Net Value $ - $ 48 $ - $ - $ 48 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Information concerning business activities | The Company’s three reporting segments are crude oil marketing, tank truck transportation of liquid chemicals and dry bulk, and oil and gas exploration and production. Information concerning the Company's various business activities is summarized as follows (in thousands): - Three Month Comparison Segment Depreciation Property and Operating (Loss) Depletion and Equipment Revenues Earnings Amortization Additions Period Ended March 31, 2017 Marketing $ 288,615 $ 1,393 $ 2,069 $ 82 Transportation 13,455 (298 ) 1,591 102 Oil and gas 1,017 (42 ) 309 822 $ 303,087 $ 1,053 $ 3,969 $ 1,006 Period Ended March 31, 2016 Marketing $ 236,394 $ 4,648 $ 2,689 $ 263 Transportation 13,347 173 1,985 3,817 Oil and gas 790 (282 ) 441 130 $ 250,531 $ 4,539 $ 5,115 $ 4,210 |
Reconciliation of segment earnings to earnings before income taxes | Segment operating earnings reflect revenues net of operating costs and depreciation, depletion and amortization and are reconciled to earnings from continuing operations before income taxes, as follows (in thousands): Three Months Ended March 31, 2017 2016 Segment operating earnings $ 1,053 $ 4,539 - General and administrative (2,637 ) (2,200 ) Operating (loss) earnings (1,584 ) 2,339 - Interest income 159 103 - Interest expense (1 ) - (Loss) Earnings before income tax $ (1,426 ) $ 2,442 |
Identifiable assets by industry segment | Identifiable assets by industry segment are as follows (in thousands) March 31, December 31, 2017 2016 Marketing $ 114,526 $ 107,257 Transportation 32,231 32,120 Oil and gas 8,167 7,279 Other 109,239 100,216 $ 264,163 $ 246,872 |
Transactions with Affiliates (T
Transactions with Affiliates (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Transactions with Affiliates [Abstract] | |
Activities with affiliates | Activities with affiliates were as follows (in thousands): Three Months Ended March 31, 2017 2016 Overhead recoveries $ - $ 21 Affiliate billings to company $ 12 $ 11 Company billings to affiliates $ 1 $ 1 Rentals paid to affiliate $ 167 $ 163 Fees paid to Bencap $ 108 $ 36 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies [Abstract] | |
Expenses and losses incurred but not reported | The Company has appropriately recognized estimated expenses and liabilities related to these policies for losses incurred but not reported to the Company or its insurance carrier as follows (in thousands): March 31, December 31, 2017 2016 Estimated expenses and liabilities $ 2,504 $ 2,657 |
Accrued medical claims | Medical accrual amounts are as follows (in thousands): March 31, December 31, 2017 2016 Accrued medical claims $ 1,923 $ 1,411 |
Summary of Significant Accoun18
Summary of Significant Accounting Policies, Prepayments (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Components of Prepayments [Abstract] | ||
Insurance premiums | $ 767 | $ 1,403 |
Rents, license and other | 586 | 694 |
Prepayments | $ 1,353 | $ 2,097 |
Summary of Significant Accoun19
Summary of Significant Accounting Policies, Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Property and Equipment [Abstract] | ||
Oil and gas property impairment | $ 3 | $ 29 |
Minimum [Member] | ||
Property and Equipment [Abstract] | ||
Property and equipment, useful life | 3 years | |
Maximum [Member] | ||
Property and Equipment [Abstract] | ||
Property and equipment, useful life | 20 years | |
Producing Property Impairments [Member] | ||
Property and Equipment [Abstract] | ||
Oil and gas property impairment | $ 0 | 1 |
Non-Producing Property Impairments [Member] | ||
Property and Equipment [Abstract] | ||
Oil and gas property impairment | $ 3 | $ 28 |
Onshore Leasehold [Member] | ||
Property and Equipment [Abstract] | ||
Onshore normal leasehold period | 3 years |
Summary of Significant Accoun20
Summary of Significant Accounting Policies, Investments (Details) - USD ($) $ in Thousands | Apr. 30, 2016 | Feb. 28, 2017 | Jan. 31, 2016 | Mar. 31, 2017 | Sep. 30, 2016 | Mar. 31, 2016 |
Investments [Abstract] | ||||||
Recognized net loss from investment | $ 0 | $ (124) | ||||
Pre-tax losses from equity method investment | $ 0 | $ (191) | ||||
Bencap LLC [Member] | ||||||
Investments [Abstract] | ||||||
Percentage of equity method investment | 30.00% | |||||
Cash payment for acquisition | $ 2,200 | |||||
Recognized net loss from investment | $ (1,400) | |||||
Pre-tax impairment charge | 1,700 | |||||
Pre-tax losses from equity method investment | (500) | |||||
Additional funding request | $ 500 | |||||
Percentage of member interest forfeited | 30.00% | |||||
Bencap LLC [Member] | December 5, 2016 to October 31, 2018 [Member] | ||||||
Investments [Abstract] | ||||||
Maximum borrowing amount | $ 1,500 | |||||
VestaCare, Inc. [Member] | ||||||
Investments [Abstract] | ||||||
Percentage of equity method investment | 15.00% | |||||
Voting interest | 3.00% | |||||
Cash payment for acquisition | $ 2,500 |
Summary of Significant Accoun21
Summary of Significant Accounting Policies, Cash Deposits and Other Assets Through Concentration of Credit Risk (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017USD ($)Customer | Mar. 31, 2016USD ($) | Dec. 31, 2016USD ($) | |
Cash Deposits and Other Assets [Abstract] | |||
Insurance collateral deposits | $ 4,222 | $ 5,032 | |
State collateral deposits | 141 | 143 | |
Materials and supplies | 377 | 354 | |
Cash deposits and other assets | 4,740 | $ 5,529 | |
Revenue Recognition [Abstract] | |||
Revenue gross-up | $ 57,565 | $ 75,927 | |
Concentration of Credit Risk [Abstract] | |||
Maximum percentage of US demand supplied by company | 1.00% | ||
Customer Concentration Risk [Member] | Minimum [Member] | |||
Concentration of Credit Risk [Abstract] | |||
Number of customers | Customer | 3 | ||
Customer Concentration Risk [Member] | Maximum [Member] | |||
Concentration of Credit Risk [Abstract] | |||
Number of customers | Customer | 5 | ||
Revenue [Member] | |||
Concentration of Credit Risk [Abstract] | |||
Percentage of revenues from one customer which loss would not have material effect | 10.00% | ||
Revenue [Member] | Customer Concentration Risk [Member] | |||
Concentration of Credit Risk [Abstract] | |||
Concentration risk, percentage | 50.00% | ||
Accounts Receivable [Member] | |||
Concentration of Credit Risk [Abstract] | |||
Industry practice payment of receivables | 20 days | ||
Accounts Receivable [Member] | Product Concentration Risk [Member] | |||
Concentration of Credit Risk [Abstract] | |||
Concentration risk, percentage | 90.00% |
Summary of Significant Accoun22
Summary of Significant Accounting Policies, Letters of Credit Facility, Statement of Cash Flows and Earnings Per Share (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017USD ($)shares | Mar. 31, 2016USD ($) | Dec. 31, 2016shares | |
Statement of Cash Flows [Abstract] | |||
Federal and state tax paid | $ 14 | $ 105 | |
Property and equipment additions | $ 836 | 350 | |
Earnings Per Share [Abstract] | |||
Weighted average number of shares outstanding (in shares) | shares | 4,217,596 | 4,217,596 | |
Potentially dilutive securities (in shares) | shares | 0 | 0 | |
Wells Fargo Bank [Member] | Standby Letter of Credit [Member] | |||
Letter of Credit Facility [Abstract] | |||
Line of credit facility, maximum borrowing capacity | $ 60,000 | ||
Stand-by letters of credit | $ 0 | $ 1,000 | |
Current ratio | 1.1 |
Summary of Significant Accoun23
Summary of Significant Accounting Policies, Use of Derivative Instruments (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)BarrelsofOilPerDayContractbbl | Mar. 31, 2017USD ($)Contractbbl | |
Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation [Abstract] | ||
As Reported Fair Value Contracts | $ 112 | $ 468 |
As Reported Fair Value Contracts | $ 64 | $ 0 |
April 2017 Through May 2017 [Member] | ||
Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation [Abstract] | ||
Total volume committed under commodity purchase and sale contract (in barrels or mmbtu) | bbl | 145,000 | |
January 2017 Through April 2017 [Member] | ||
Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation [Abstract] | ||
Total volume committed under commodity purchase and sale contract (in barrels or mmbtu) | bbl | 145,000 | |
Commodity Contract [Member] | ||
Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation [Abstract] | ||
Number of contracts held | Contract | 2 | 4 |
Commodity Contract [Member] | January 2017 Through March 2017 [Member] | ||
Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation [Abstract] | ||
Volume committed per day under commodity purchase and sale contract (in barrels or mmbtu) | BarrelsofOilPerDay | 65 | |
Commodity Contract [Member] | Not Designated as Hedging Instrument [Member] | Current Assets [Member] | ||
Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation [Abstract] | ||
Asset Derivatives | $ 378 | $ 750 |
Liability Derivatives | 0 | 0 |
Less Counterparty Offsets | (266) | (282) |
As Reported Fair Value Contracts | 112 | 468 |
Commodity Contract [Member] | Not Designated as Hedging Instrument [Member] | Other Assets [Member] | ||
Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation [Abstract] | ||
Asset Derivatives | 0 | 0 |
Liability Derivatives | 0 | 0 |
Less Counterparty Offsets | 0 | 0 |
As Reported Fair Value Contracts | 0 | 0 |
Commodity Contract [Member] | Not Designated as Hedging Instrument [Member] | Current Liabilities [Member] | ||
Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation [Abstract] | ||
Asset Derivatives | 0 | 0 |
Liability Derivatives | 330 | 282 |
Less Counterparty Offsets | (266) | (282) |
As Reported Fair Value Contracts | 64 | 0 |
Commodity Contract [Member] | Not Designated as Hedging Instrument [Member] | Other Liabilities [Member] | ||
Fair Value Forward Hydrocarbon Commodity Contracts at Gross Valuation [Abstract] | ||
Asset Derivatives | 0 | 0 |
Liability Derivatives | 0 | 0 |
Less Counterparty Offsets | 0 | 0 |
As Reported Fair Value Contracts | $ 0 | $ 0 |
Summary of Significant Accoun24
Summary of Significant Accounting Policies, Derivatives by Hedging Relationship and Fair Value Measurements (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Fair Value, Measurements, Recurring [Member] | |||
Fair Value Assets (Liabilities), Net [Abstract] | |||
Derivatives (fair value contracts) - Current assets | $ 468 | $ 112 | |
Derivatives (fair value contracts) - Current liabilities | 0 | (64) | |
Net Value | 468 | 48 | |
Fair Value, Measurements, Recurring [Member] | Counterparty Offsets [Member] | |||
Fair Value Assets (Liabilities), Net [Abstract] | |||
Derivatives (fair value contracts) - Current assets | (282) | (266) | |
Derivatives (fair value contracts) - Current liabilities | 282 | 266 | |
Net Value | 0 | 0 | |
Fair Value, Measurements, Recurring [Member] | Level 1 Quoted Prices [Member] | |||
Fair Value Assets (Liabilities), Net [Abstract] | |||
Derivatives (fair value contracts) - Current assets | 0 | 0 | |
Derivatives (fair value contracts) - Current liabilities | 0 | 0 | |
Net Value | 0 | 0 | |
Fair Value, Measurements, Recurring [Member] | Level 2 Observable [Member] | |||
Fair Value Assets (Liabilities), Net [Abstract] | |||
Derivatives (fair value contracts) - Current assets | 750 | 378 | |
Derivatives (fair value contracts) - Current liabilities | (282) | (330) | |
Net Value | 468 | 48 | |
Fair Value, Measurements, Recurring [Member] | Level 3 Unobservable [Member] | |||
Fair Value Assets (Liabilities), Net [Abstract] | |||
Derivatives (fair value contracts) - Current assets | 0 | 0 | |
Derivatives (fair value contracts) - Current liabilities | 0 | 0 | |
Net Value | 0 | $ 0 | |
Commodity Contract [Member] | Revenues - Marketing [Member] | Not Designated as Hedging Instrument [Member] | |||
Earnings (Loss) Recognized in Income [Abstract] | |||
Earnings (loss) | $ 420 | $ 158 |
Segment Reporting, Information
Segment Reporting, Information Concerning Business Activities (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017USD ($)Segment | Mar. 31, 2016USD ($) | |
Segment Reporting [Abstract] | ||
Number of reporting segments | Segment | 3 | |
Revenues | $ 303,087 | $ 250,531 |
Depreciation, depletion and amortization | 3,969 | 5,115 |
Reportable Segments [Member] | ||
Segment Reporting [Abstract] | ||
Revenues | 303,087 | 250,531 |
Segment operating (loss) earnings | 1,053 | 4,539 |
Depreciation, depletion and amortization | 3,969 | 5,115 |
Property and equipment additions | 1,006 | 4,210 |
Reportable Segments [Member] | Marketing [Member] | ||
Segment Reporting [Abstract] | ||
Revenues | 288,615 | 236,394 |
Segment operating (loss) earnings | 1,393 | 4,648 |
Depreciation, depletion and amortization | 2,069 | 2,689 |
Property and equipment additions | 82 | 263 |
Reportable Segments [Member] | Transportation [Member] | ||
Segment Reporting [Abstract] | ||
Revenues | 13,455 | 13,347 |
Segment operating (loss) earnings | (298) | 173 |
Depreciation, depletion and amortization | 1,591 | 1,985 |
Property and equipment additions | 102 | 3,817 |
Reportable Segments [Member] | Oil and Gas [Member] | ||
Segment Reporting [Abstract] | ||
Revenues | 1,017 | 790 |
Segment operating (loss) earnings | (42) | (282) |
Depreciation, depletion and amortization | 309 | 441 |
Property and equipment additions | $ 822 | $ 130 |
Segment Reporting, Reconciliati
Segment Reporting, Reconciliation of Segment Earnings to Earnings Before Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Reconciliation of Segment Earnings [Abstract] | ||
General and administrative | $ (2,637) | $ (2,200) |
Operating (loss) earnings | (1,584) | 2,339 |
Interest income | 159 | 103 |
Interest expense | (1) | 0 |
Loss (earnings) before income taxes and equity investments | (1,426) | 2,442 |
Reportable Segments [Member] | ||
Reconciliation of Segment Earnings [Abstract] | ||
Segment operating earnings | 1,053 | 4,539 |
Segment Reconciling Item [Member] | ||
Reconciliation of Segment Earnings [Abstract] | ||
General and administrative | (2,637) | (2,200) |
Interest income | 159 | 103 |
Interest expense | $ (1) | $ 0 |
Segment Reporting, Identifiable
Segment Reporting, Identifiable Assets by Industry Segment (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Identifiable Assets By Industry Segment [Abstract] | ||
Assets | $ 264,163 | $ 246,872 |
Reportable Segments [Member] | ||
Identifiable Assets By Industry Segment [Abstract] | ||
Assets | 264,163 | 246,872 |
Reportable Segments [Member] | Marketing [Member] | ||
Identifiable Assets By Industry Segment [Abstract] | ||
Assets | 114,526 | 107,257 |
Reportable Segments [Member] | Transportation [Member] | ||
Identifiable Assets By Industry Segment [Abstract] | ||
Assets | 32,231 | 32,120 |
Reportable Segments [Member] | Oil and Gas [Member] | ||
Identifiable Assets By Industry Segment [Abstract] | ||
Assets | 8,167 | 7,279 |
Reportable Segments [Member] | Other [Member] | ||
Identifiable Assets By Industry Segment [Abstract] | ||
Assets | $ 109,239 | $ 100,216 |
Transactions with Affiliates (D
Transactions with Affiliates (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | |
Feb. 28, 2017 | Mar. 31, 2017 | Mar. 31, 2016 | |
Bencap LLC [Member] | |||
Transactions with Affiliates [Abstract] | |||
Additional funding request | $ 500 | ||
Affiliated Entities [Member] | |||
Transactions with Affiliates [Abstract] | |||
Overhead recoveries | $ 0 | $ 21 | |
Affiliate billings to company | 12 | 11 | |
Company billings to affiliates | 1 | 1 | |
Rentals paid to affiliate | 167 | 163 | |
Fees paid to Bencap | $ 108 | $ 36 |
Commitments and Contingencies29
Commitments and Contingencies (Details) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017USD ($)Lawsuit | Dec. 31, 2016USD ($) | |
Estimated Expenses and Liabilities [Abstract] | ||
Estimated expenses and liabilities | $ 2,504 | $ 2,657 |
Medical Accrual [Abstract] | ||
Accrued medical claims | $ 1,923 | 1,411 |
Total number of law suits | Lawsuit | 2 | |
Future legal cost accrued | $ 500 | $ 500 |
Minimum [Member] | ||
Medical Accrual [Abstract] | ||
Aggregate medical claims for umbrella insurance coverage per calendar year | $ 4,500 |