Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2024 | May 09, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-11476 | |
Entity Registrant Name | VERTEX ENERGY, INC. | |
Entity Incorporation, State | NV | |
Entity Tax Identification Number | 94-3439569 | |
Entity Address, Street | 1331 Gemini Street | |
Entity Address, Suite | Suite 250, | |
Entity Address, City | Houston | |
Entity Address, State | TX | |
Entity Address, Postal Zip Code | 77058 | |
City Area Code | 866 | |
Local Phone Number | 660-8156 | |
Title of each class | Common Stock,$0.001 Par Value Per Share | |
Trading Symbol(s) | VTNR | |
Name of each exchange on which registered | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 93,514,346 | |
Entity Central Index Key | 0000890447 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2024 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets | ||
Cash and cash equivalents | $ 62,140 | $ 76,967 |
Restricted cash | 3,609 | 3,606 |
Accounts receivable, net | 41,559 | 36,164 |
Inventory | 198,979 | 182,120 |
Prepaid expenses and other current assets | 38,673 | 53,174 |
Total current assets | 344,960 | 352,031 |
Fixed assets, net | 332,949 | 326,111 |
Finance lease right-of-use assets | 63,524 | 64,499 |
Operating lease right-of use assets | 78,802 | 96,394 |
Intangible assets, net | 10,789 | 11,541 |
Other assets | 4,029 | 4,048 |
TOTAL ASSETS | 835,053 | 854,624 |
Current liabilities | ||
Accounts payable | 69,796 | 75,004 |
Accrued expenses and other current liabilities | 69,240 | 73,636 |
Finance lease liability-current | 2,497 | 2,435 |
Operating lease liability-current | 13,281 | 20,296 |
Current portion of long-term debt, net | 12,524 | 16,362 |
Obligations under inventory financing agreements, net | 169,656 | 141,093 |
Total current liabilities | 336,994 | 328,826 |
Long-term debt, net | 177,772 | 170,701 |
Finance lease liability-long-term | 65,576 | 66,206 |
Operating lease liability-long-term | 64,345 | 74,444 |
Deferred tax liabilities | 2,776 | 2,776 |
Derivative warrant liability | 3,249 | 9,907 |
Other liabilities | 1,377 | 1,377 |
Total liabilities | 652,089 | 654,237 |
EQUITY | ||
Common stock, $0.001 par value per share; 750,000,000 shares authorized; 93,514,346 and 93,514,346 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively. | 94 | 94 |
Additional paid-in capital | 384,063 | 383,632 |
Accumulated deficit | (205,113) | (187,379) |
Total Vertex Energy, Inc. shareholders' equity | 179,044 | 196,347 |
Non-controlling interest | 3,920 | 4,040 |
Total equity | 182,964 | 200,387 |
TOTAL LIABILITIES AND EQUITY | $ 835,053 | $ 854,624 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.001 | |
Common stock, shares authorized (in shares) | 750,000,000 | |
Common stock, shares issued (in shares) | 93,514,346 | 93,514,346 |
Common stock, shares outstanding (in shares) | 93,514,346 | 93,514,346 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||
Revenues | $ 695,326 | $ 691,142 |
Cost of revenues (exclusive of depreciation and amortization shown separately below) | 652,034 | 619,352 |
Depreciation and amortization attributable to costs of revenues | 8,186 | 4,337 |
Gross profit | 35,106 | 67,453 |
Operating expenses: | ||
Selling, general and administrative expenses (exclusive of depreciation and amortization shown separately below) | 39,782 | 41,942 |
Depreciation and amortization attributable to operating expenses | 1,104 | 1,016 |
Total operating expenses | 40,886 | 42,958 |
Income (loss) from operations | (5,780) | 24,495 |
Other income (expense): | ||
Other income (expenses) | (1,049) | 1,653 |
Gain (loss) on change in value of derivative warrant liability | 6,658 | (9,185) |
Interest expense | (17,683) | (12,477) |
Total other expense | (12,074) | (20,009) |
Income (loss) from continuing operations before income tax | (17,854) | 4,486 |
Income tax expense | 0 | (1,013) |
Income (loss) from continuing operations | (17,854) | 3,473 |
Income from discontinued operations, net of tax (see note 22) | 0 | 50,340 |
Net income (loss) | (17,854) | 53,813 |
Net loss attributable to non-controlling interest from continuing operations | (120) | (50) |
Net income (loss) attributable to Vertex Energy, Inc. | (17,734) | 53,863 |
Net income (loss) attributable to common shareholders from continuing operations | (17,734) | 3,523 |
Net income attributable to common shareholders from discontinued operations, net of tax | 0 | 50,340 |
Net income (loss) attributable to common shareholders, basic | (17,734) | 53,863 |
Net income (loss) attributable to common shareholders | $ (17,734) | $ 53,863 |
Basic income (loss) per common share | ||
Continuing operations (in dollars per share) | $ (0.19) | $ 0.05 |
Discontinued operations, net of tax (in dollars per share) | 0 | 0.66 |
Basic income (loss) per common share (in dollars per share) | (0.19) | 0.71 |
Diluted income (loss) per common share | ||
Continuing operations (in dollars per share) | (0.19) | 0.04 |
Discontinued operations, net of tax (in dollars per share) | 0 | 0.64 |
Diluted income (loss) per share (in dollars per share) | $ (0.19) | $ 0.68 |
Shares used in computing earnings per share | ||
Basic (in shares) | 93,514 | 75,689 |
Diluted (in shares) | 93,514 | 78,996 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Non-controlling Interest |
Beginning balance (in shares) at Dec. 31, 2022 | 75,670,000 | ||||
Beginning balance at Dec. 31, 2022 | $ 165,420 | $ 76 | $ 279,552 | $ (115,893) | $ 1,685 |
Increase (Decrease) in Stockholders' Equity | |||||
Exercise of options (in shares) | 166,000 | ||||
Exercise of options | 209 | $ 0 | 209 | ||
Stock based compensation expense | 365 | 365 | |||
Non controlling shareholder contribution | 980 | 980 | |||
Net income (loss) | 53,813 | 53,863 | (50) | ||
Ending balance (in shares) at Mar. 31, 2023 | 75,836,000 | ||||
Ending balance at Mar. 31, 2023 | 220,787 | $ 76 | 280,126 | (62,030) | 2,615 |
Beginning balance (in shares) at Dec. 31, 2023 | 93,515,000 | ||||
Beginning balance at Dec. 31, 2023 | 200,387 | $ 94 | 383,632 | (187,379) | 4,040 |
Increase (Decrease) in Stockholders' Equity | |||||
Exercise of options (in shares) | 166,000 | ||||
Stock based compensation expense | 431 | 431 | |||
Net income (loss) | (17,854) | (17,734) | (120) | ||
Ending balance (in shares) at Mar. 31, 2024 | 93,515,000 | ||||
Ending balance at Mar. 31, 2024 | $ 182,964 | $ 94 | $ 384,063 | $ (205,113) | $ 3,920 |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) | Mar. 31, 2024 $ / shares |
Common stock, par value (in dollars per share) | $ 0.001 |
Common Stock | |
Common stock, par value (in dollars per share) | $ 0.001 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Cash flows from operating activities | ||
Net income (loss) | $ (17,854) | $ 53,813 |
Income from discontinued operations, net of tax | 0 | 50,340 |
Income (loss) from continuing operations | (17,854) | 3,473 |
Adjustments to reconcile net income (loss) from continuing operations to cash used in operating activities | ||
Stock based compensation expense | 431 | 365 |
Depreciation and amortization | 9,290 | 5,353 |
Deferred income tax expense | 0 | 1,013 |
Loss on lease modification | 35 | 0 |
Loss on sale of assets | 691 | 3 |
Increase in allowance for credit losses | 19 | 882 |
Increase (decrease) in fair value of derivative warrant liability | (6,658) | 9,185 |
(Gain) loss on commodity derivative contracts | 1,322 | (1,516) |
Net cash settlements on commodity derivatives | (2,292) | 3,519 |
Amortization of debt discount and deferred costs | 4,758 | 4,572 |
Changes in operating assets and liabilities | ||
Accounts receivable and other receivables | (4,180) | (26,291) |
Inventory | (16,859) | (52,553) |
Prepaid expenses and other current assets | 14,710 | (18,103) |
Accounts payable | (5,250) | 11,005 |
Accrued expenses | (7,308) | 22,486 |
Other assets | 19 | (44) |
Net cash used in operating activities from continuing operations | (29,126) | (36,651) |
Cash flows from investing activities | ||
Purchase of fixed assets | (14,726) | (73,936) |
Proceeds from sale of discontinued operation | 0 | 87,238 |
Proceeds from sale of fixed assets | 2,576 | 0 |
Net cash provided by (used in) investing activities from continuing operations | (12,150) | 13,302 |
Cash flows from financing activities | ||
Payments on finance leases | (586) | (310) |
Proceeds from exercise of options and warrants to common stock | 0 | 209 |
Contributions received from noncontrolling interest | 0 | 980 |
Net change on inventory financing agreements | 28,313 | (11,284) |
Proceeds from note payable | 3,175 | 0 |
Payments on note payable | (4,450) | (17,165) |
Net cash provided by (used in) financing activities from continuing operations | 26,452 | (27,570) |
Discontinued operations: | ||
Net cash provided by (used in) operating activities | 0 | (150) |
Net cash provided by (used in) discontinued operations | 0 | (150) |
Net decrease in cash, cash equivalents and restricted cash | (14,824) | (51,069) |
Cash, cash equivalents, and restricted cash at beginning of the period | 80,573 | 146,187 |
Cash, cash equivalents, and restricted cash at end of period | 65,749 | 95,118 |
Cash and cash equivalents | 62,140 | 86,689 |
Restricted cash | 3,609 | 8,429 |
Cash and cash equivalents and restricted cash as shown in the consolidated statements of cash flows | 65,749 | 95,118 |
SUPPLEMENTAL INFORMATION | ||
Cash paid for interest | 4,811 | 10,124 |
Cash paid for taxes | 0 | 0 |
NON-CASH INVESTING AND FINANCING TRANSACTIONS | ||
ROU assets obtained from new finance lease liabilities | 18 | 15,024 |
ROU assets obtained from new operating lease liabilities | 74 | 15,078 |
ROU assets disposed under operating leases | $ (17,666) | $ 0 |
BASIS OF PRESENTATION AND NATUR
BASIS OF PRESENTATION AND NATURE OF OPERATIONS | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION AND NATURE OF OPERATIONS | BASIS OF PRESENTATION AND NATURE OF OPERATIONS Vertex Energy, Inc. (the "Company" or "Vertex Energy") is an energy transition company focused on the production and distribution of conventional and alternative fuels. We operate used motor oil processing plants in Houston, Texas, Port Arthur, Texas, and Marrero, Louisiana. As of April 1, 2022, we own a refinery in Mobile, Alabama (the “Mobile Refinery”) with an operable refining capacity of 75,000 barrels per day (“bpd”) and more than 3.2 million barrels of storage capacity. At the time of the acquisition, the Company also entered into an inventory financing agreement. See Note 10 “Inventory Financing Agreement” for additional information. The accompanying unaudited interim consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (" SEC ") and should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2023, contained in the Company's annual report, as filed with the SEC on Form 10-K on March 7, 2024 (the " Form 10-K "). Refining and Marketing Effective April 1, 2022, we completed the acquisition of a 75,000 bpd crude oil refinery ten miles north of Mobile, in Saraland, Alabama (the “ Mobile Refinery ”) and related logistics assets, which include a deep-water draft, bulk loading terminal facility with 3.2 million barrels (bbls) of storage capacity for crude oil and associated refined petroleum products located in Mobile, Alabama (the “ Blakeley Island Terminal ”). The terminal includes a dock for loading and unloading vessels with a pipeline tie-in, as well as the related logistics infrastructure of a high-capacity truck rack with 3-4 loading heads per truck, each rated at 600 gallons per minute (the “ Mobile Truck Rack ”). The Mobile Refinery currently processes heavy and sour crude to produce heavy olefin feed, regular gasoline, premium gasoline, jet fuel, and diesel fuel. Additionally, Vertex Energy aggregates used motor oil, petroleum distillates, transmix and other off-specification chemical products. These feedstock streams are purchased from pipeline operators, refineries, chemical processing facilities and third-party providers. The Company has a toll-based processing agreement in place with Monument Chemical Port Arthur, LLC (“ Monument Chemical ”) to re-refine these feedstock streams, under the Company’s direction, into various end products. Monument Chemical uses industry standard processing technologies to re-refine the feedstock into pygas, gasoline blendstock and marine fuel cutterstock. The Company sells the re-refined products directly to end customers or to processing facilities for further refinement. In addition, we are distributing refined motor fuels such as gasoline, blended gasoline products and diesel used as engine fuels, to third party customers who typically resell these products to retailers and end consumers. Black Oil and Recovery Through its Black Oil segment, which has been operational since 2001, Vertex Energy aggregates and sells used motor oil. The Company has a network of approximately 30 suppliers that collect used oil from businesses such as oil change service stations, automotive repair shops, manufacturing facilities, petroleum refineries, and petrochemical manufacturing operations. The Company procures the used oil from collectors and manages the logistics of transport, storage and delivery to its customers. Typically, the used oil is sold in bulk to ensure the efficient delivery by truck, rail, or barge. In many cases, there are contractual procurement and sale agreements with the suppliers and customers, respectively. The Company believes these contracts are beneficial to all parties involved because they help ensure a minimum volume is procured from collectors, a minimum volume is sold to the customers, and the Company is insulated from inventory risk by a spread between the costs to acquire used oil and the revenues received from the sale and delivery of used oil. In addition, the Company operates its own re-refining operations at the Cedar Marine Terminal, in Baytown, Texas, which uses the Company's proprietary Thermal Chemical Extraction Process (“ TCEP ”) technology to re-refine the used oil into marine fuel cutterstock (when such use makes economic sense) and a higher-value feedstock for further processing. The finished product can then be sold by barge as a fuel oil cutterstock and a feedstock component for major refineries. Through the operations at our Marrero, Louisiana facility, we produce a Vacuum Gas Oil (VGO) product from used oil re-refining which is then sold via barge to end users to utilize in a refining process or a fuel oil blend. Discontinued operations of Vertex include our Heartland Assets and Operations. Refer to Note 22, "Discontinued Operations " for additional information. Through its Recovery segment, Vertex Energy aggregates and sells ferrous and non-ferrous recyclable metal products that are recovered from manufacturing and consumption. Use of Estimates The preparation of financial statements conforming with generally accepted accounting principles in the United States (“GAAP”) requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and reported amounts of revenue and expenses. Actual results could differ from these estimates. Any effects on the business, financial position or results of operations from revisions to these estimates are recorded in the period in which the facts that give rise to the revision become known. |
SUMMARY OF CRITICAL ACCOUNTING
SUMMARY OF CRITICAL ACCOUNTING POLICIES AND ESTIMATES | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
SUMMARY OF CRITICAL ACCOUNTING POLICIES AND ESTIMATES | SUMMARY OF CRITICAL ACCOUNTING POLICIES AND ESTIMATES With the exception of the accounting policies below, there have been no new or material changes to the significant accounting policies discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. Liquidity The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company has cash and cash equivalents of $62.1 million as of March 31, 2024. As shown in the accompanying unaudited consolidated financial statements, the Company generated a net loss from continuing operations of $17.9 million during the three months ended March 31, 2024. The Company had cash outflows from operating activities from continuing operations, which were $29.1 million during the three months ended March 31, 2024. The Company has cash outflows from investing activities from continuing operations due to its investments in capital expenditures partially offset by proceeds of real property sales. The Company has generated significant cash inflows from financing activities from continuing operations, primarily attributed to proceeds from inventory financing agreement. Restricted cash as of March 31, 2024, and December 31, 2023, consisted of a $2.0 million d eposit in a bank for financing of a short-term equipment lease, and $1.5 million held in an escrow account in connection with the sale of Vertex Refining OH, LLC (“Vertex OH”), and $0.1 million deposit in a money market account to serve as collateral for payment of a credit card. Going Concern The accompanying consolidated financial statements of the Company have been prepared assuming the Company will continue as a going concern. The going concern basis of presentation assumes that the Company will continue in operation one year after the date these financial statements are issued and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The evaluation of going concern under the accounting guidance requires significant judgment which involves the Company considering that it has historically incurred losses in recent years as it has prepared to grow its business through acquisition opportunities. The Company must also consider its current liquidity as well as future market and economic conditions that may be deemed outside the control of the Company as it relates to obtaining financing and generating future profits. As of March 31, 2024, the Company has evaluated its ability to continue as a going concern. Management has considered various factors, including historical operating results, liquidity, financial condition, and other relevant conditions and events. Based on this evaluation, management has determined that there is substantial doubt about the Company's ability to continue as a going concern within one year of the financial statement issuance date primarily due to the Term Loan (see below “ Note 15. Financing Agreements ” ) maturing on April 1, 2025. Management's plans to mitigate the going concern risk include current efforts to refinance the debt of the Company with a new lender group, and the various efforts underway to reduce and minimize costs throughout the organization. In addition, the Company believes it has the ability, if necessary, to raise additional capital through the capital equity markets. However, there can be no assurance that these plans will be successful. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Investors and other users of the financial statements are encouraged to consider this information when assessing the Company's financial position and prospects. New Accounting Pronouncements The Company has not identified any recent accounting pronouncements that are expected to have a material impact on our financial condition, results of operations or cash flows upon adoption. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2024 | |
Environmental Remediation Obligations [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Litigation The Company, in its normal course of business, is involved in various claims and legal action. In the opinion of management, the outcome of these claims and actions will not have a material adverse impact upon the financial position of the Company. We are currently party to the following material litigation proceedings: Doucet litigation : Vertex Refining LA, LLC (“ Vertex Refining LA ”), the wholly-owned subsidiary of Vertex Operating, LLC (“Vertex Operating”) was named as a defendant, along with numerous other parties, in five lawsuits filed on or about February 12, 2016, in the Second Parish Court for the Parish of Jefferson, State of Louisiana, Case No. 121749, by Russell Doucet et. al., Case No. 121750, by Kendra Cannon et. al., Case No. 121751, by Lashawn Jones et. al., Case No. 121752, by Joan Strauss et. al. and Case No. 121753, by Donna Allen et. al. The suits relate to alleged noxious and harmful emissions from our facility located in Marrero, Louisiana. The suits seek damages for physical and emotional injuries, pain and suffering, medical expenses and deprivation of the use and enjoyment of plaintiffs’ homes. We intend to vigorously defend ourselves and oppose the relief sought in the complaints, provided that at this stage of the litigation, the Company has no basis for determining whether there is any likelihood of material loss associated with the claims and/or the potential and/or the outcome of the litigation. Penthol litigation : On November 17, 2020, Vertex Energy Operating, LLC (“Vertex”) filed a lawsuit against Penthol LLC (“Penthol”) in the 61st Judicial District Court of Harris County, Texas, Cause No. 2020-65269 , for breach of contract. On February 8, 2021, Penthol filed a complaint against Vertex in the United States District Court for the Southern District of Texas; Civil Action No. 4:21-CV- 416 (the “Complaint”). The parties agreed to move the pending claims and defenses in the Texas state court lawsuit into the federal court lawsuit. On March 7, 2024, the Judge in the action issued a Final Judgment and Findings of Fact & Conclusions of Law. In sum, Penthol lost all of its claims against Vertex, including all of its breach of contract theories. Vertex won its unpaid commission claim in the amount of $1.4 million plus five percent interest on the unpaid claim amount. Vertex is presently considering whether to appeal the judgment and it is also possible that Penthol appeals the judgment against it. Putative Class Action Litigation : On April 13, 2023, William C. Passmore filed a putative class action lawsuit against the Company; Benjamin P. Cowart, our Chief Executive Officer and Chairman; and Chris Carlson, our Chief Financial Officer; in the United States District Court for the Southern District of Alabama (Southern Division). In May 2023 and June 2023, additional plaintiffs filed virtually identical putative class action lawsuits against the same three defendants, the first of which was filed in the same courthouse and the second of which was filed in the United States District Court for the Southern District of Texas (Houston Division). These three putative class action lawsuits are substantially similar and allege that the Company, through Messrs. Cowart and Carlson, issued materially false and misleading statements, or omitted material information, regarding the projected future financial performance of the Mobile Refinery in 2022. The plaintiffs have asserted claims for violations of Section 10(b) of the Exchange Act, and Rule 10b-5 promulgated thereunder, and Section 20(a) of the Exchange Act, against all defendants. On January 24, 2024, after considering party briefing, the United States District Court for the Southern District of Alabama ordered that the three putative class action lawsuits be consolidated and transferred to the Southern District of Texas for further proceedings. On February 1, 2024, the court issued an order appointing lead plaintiffs and lead counsel for the putative class, who then filed a consolidated amended complaint. The Company anticipates moving to dismiss the claims in the consolidated amended complaint, with briefing on the motion currently scheduled to be complete by August 20, 2024. Shareholder Derivative Lawsuits : In June 2023, two plaintiffs filed shareholder derivative lawsuits against certain Directors (both current and former) and Officers in the state courts of Texas and Nevada. The suits are substantially similar and allege that the Directors and Officers of the Company breached duties owed to the Company by allowing the Company to issue materially false and misleading statements, or failing to disclose material information, regarding the projected future financial performance of the Mobile Refinery in 2022. Both the Texas and Nevada plaintiffs have asserted claims for breach of fiduciary duty, and the Texas plaintiff has asserted an additional claim for unjust enrichment. Plaintiffs seek multiple forms of relief, including high-level resolutions for amendments to the Company’s corporate governance documents. On July 19, 2023, the Texas court granted the plaintiff’s notice of non-suit as to two current Directors, who were only named in the Texas case, dismissing them from the lawsuit without prejudice, and on August 28, 2023, the Court granted the parties’ joint motion to stay the derivative lawsuit pending the outcome of an anticipated motion to dismiss in the putative securities class action. Similarly, on October 5, 2023, the Nevada court granted the parties’ joint stipulation to stay the case pending the outcome of the anticipated motion to dismiss in the putative securities class action. The Company has also been informed that a third shareholder derivative lawsuit was filed in the United States District Court for the Southern District of Texas on February 26, 2024, against certain Directors and Officers of the Company. The factual allegations in the third derivative lawsuit are substantially similar to the derivative lawsuits that are stayed in Texas and Nevada. This third derivative lawsuit, however, contains five claims in total, including claims for breach of fiduciary duty, aiding and abetting breach of fiduciary duty, unjust enrichment, violations of Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, and waste of corporate assets. The Company plans to seek a stay of the third derivative lawsuit that is similar to the stay entered in the other derivative lawsuits, as well as dismissal of the two Directors who were dismissed from the first derivative lawsuit in Texas state court. The Company has retained counsel to respond to the putative class action and the shareholder derivative lawsuits, and its assessment of the respective allegations is ongoing. All defendants intend to vigorously defend against the allegations. At this stage of the lawsuits described above, we are unable to anticipate the ultimate impact, if any, that the legal proceedings may have on the consolidated financial position, liquidity, results of operations, or cash flows of the Company. As a result, we have not estimated a range of potential exposure for amounts, if any, that might become payable in connection with these matters and reserves have not been established. If an unfavorable ruling or development were to occur in these or other possible legal proceedings and claims, there exists the possibility of a material adverse impact on our business, results of operations, prospects, cash flows, or financial position and it is possible that an adverse outcome in any of such matters may have a material adverse impact on the Company. Environmental Matters |
NON-CONTROLLING INTERESTS
NON-CONTROLLING INTERESTS | 3 Months Ended |
Mar. 31, 2024 | |
Noncontrolling Interest [Abstract] | |
NON-CONTROLLING INTERESTS | NON-CONTROLLING INTERESTS Vertex Recovery Management LA, LLC On May 25, 2016, Vertex Recovery Management, LLC, our wholly-owned subsidiary (" VRM ") and Industrial Pipe, Inc. (" Industrial Pipe "), formed a joint venture through a Louisiana limited liability company, Vertex Recovery Management LA, LLC (" VRMLA "). VRM owns 51% and Industrial Pipe owns 49% of VRMLA. VRMLA is currently buying and preparing ferrous and non-ferrous scrap intended for large haul barge sales. We consolidated 100% of VRMLA's net loss for the period ended March 31, 2024 and 2023, respectively, and then added the loss attributable to the non-controlling interest back to the Company's " Net income attributable to Vertex Energy, Inc. " in the Consolidated Statement of Operations. The below table represents the net loss of VRMLA for the periods ended March 31, 2024 and 2023 (in thousands). Three Months Ended March 31, 2024 2023 Net loss consolidated $ (245) $ (102) Loss attributed to Non-controlling entity $ (120) $ (50) |
REVENUES
REVENUES | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
REVENUES | REVENUES The following tables present our revenues disaggregated by geographical market and revenue source (in thousands): Three Months Ended March 31, 2024 Refining & Black Oil & Recovery Corporate and Eliminations Consolidated Primary Geographical Markets Gulf Coast $ 657,707 $ 38,641 $ (1,022) $ 695,326 Sources of Revenue Refined products: Gasolines $ 133,151 $ — $ — $ 133,151 Jet Fuels 136,137 — — 136,137 Diesel 124,701 — — 124,701 Renewable diesel 75,803 — — 75,803 Other refinery products (1) 180,967 31,724 (1,022) 211,669 Re-refined products: Pygas 3,867 — — 3,867 Metals (2) — 3,442 — 3,442 Other re-refined products (3) — 1,773 — 1,773 Services: Terminalling 3,081 — — 3,081 Oil collection services — 1,702 — 1,702 Total revenues $ 657,707 $ 38,641 $ (1,022) $ 695,326 Three Months Ended March 31, 2023 Refining & Black Oil & Recovery Corporate and Eliminations Consolidated Primary Geographical Markets Gulf Coast $ 659,328 $ 34,547 $ (2,733) $ 691,142 Sources of Revenue Refined products: Gasolines $ 147,721 $ — $ — $ 147,721 Jet Fuels 142,375 — — 142,375 Diesel 182,456 — — 182,456 Other refinery products (1) 180,490 29,423 (2,733) 207,180 Re-refined products: Pygas 3,835 — — 3,835 Metals (2) — 3,413 — 3,413 Other re-refined products (3) 518 998 — 1,516 Services: Terminalling 1,933 — — 1,933 Oil collection services — 713 — 713 Total revenues $ 659,328 $ 34,547 $ (2,733) $ 691,142 (1) Other refinery products include the sales of base oil, VGO (vacuum gas oil), cutterstock and Hydrotreated VGO and other petroleum products. (2) Metals consist of recoverable ferrous and non-ferrous recyclable metals from manufacturing and consumption. Scrap metal can be recovered from pipes, barges, boats, building supplies, surplus equipment, tanks, and other items consisting of metal composition. These materials are segregated, processed, cut-up and sent back to a steel mill for re-purposing. (3) Other re-refinery products include the sales of asphalt, condensate, recovered products, and other petroleum products. |
SEGMENT REPORTING
SEGMENT REPORTING | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING The Refining and Marketing segment consists primarily of the sale of gasoline, diesel and jet fuel produced at the Mobile Refinery as well as pygas and industrial fuels, which are produced at a third-party facility. During the second quarter of 2023, the Mobile Refinery began processing soybean oil into renewable diesel. The Black Oil and Recovery segment consists primarily of the sale of (a) petroleum products which include base oil and industrial fuels—which consist of used motor oils, cutterstock and fuel oil generated by our facilities; (b) oil collection services—which consist of used oil sales, burner fuel sales, antifreeze sales and service charges; (c) the sale of other re-refinery products including asphalt, condensate, recovered products, and used motor oil; (d) transportation revenues; (e) the sale of VGO/marine fuel; (f) the sale of ferrous and non-ferrous recyclable metal products that are recovered from manufacturing and consumption; and (g) revenues generated from trading/marketing of Group III Base Oils. The Black Oil and Recovery segment excludes all property and assets owned by Vertex OH, including inventory associated with the Heartland Refinery, and all real and leased property and permits owned by Vertex OH, and all used motor oil collection and recycling assets and operations owned by Vertex OH (collectively with the Heartland Refinery, the “Heartland Assets and Operations”), which are presented herein as discontinued operations. We also disaggregate our revenue by product category for each of our segments, as we believe such disaggregation helps depict how our revenue and cash flows are affected by economic factors. Segment information for the three months ended March 31, 2024 and 2023 is as follows (in thousands): THREE MONTHS ENDED MARCH 31, 2024 Refining & Black Oil & Recovery Corporate and Eliminations Total Revenues: Refined products $ 650,759 $ 31,724 $ (1,022) $ 681,461 Re-refined products 3,867 5,215 — 9,082 Services 3,081 1,702 — 4,783 Total revenues 657,707 38,641 (1,022) 695,326 Cost of revenues (exclusive of depreciation and amortization shown separately below) 622,974 30,082 (1,022) 652,034 Depreciation and amortization attributable to costs of revenues 6,541 1,645 — 8,186 Gross profit 28,192 6,914 — 35,106 Selling, general and administrative expenses 26,147 5,397 8,238 39,782 Depreciation and amortization attributable to operating expenses 793 72 239 1,104 Income (loss) from operations 1,252 1,445 (8,477) (5,780) Other income (expenses) Other expense (685) (359) (5) (1,049) Gain on change in derivative liability — — 6,658 6,658 Interest expense (4,747) (96) (12,840) (17,683) Total other expense (5,432) (455) (6,187) (12,074) Income (loss) from continuing operations before income tax $ (4,180) $ 990 $ (14,664) $ (17,854) Capital expenditures $ 11,299 $ 3,427 $ — $ 14,726 THREE MONTHS ENDED MARCH 31, 2023 Refining & Black Oil & Recovery Corporate and Eliminations Total Revenues: Refined products $ 653,042 $ 29,423 $ (2,733) $ 679,732 Re-refined products 4,353 4,411 — 8,764 Services 1,933 713 — 2,646 Total revenues 659,328 34,547 (2,733) 691,142 Cost of revenues (exclusive of depreciation and amortization shown separately below) 589,812 30,418 (878) 619,352 Depreciation and amortization attributable to costs of revenues 3,294 1,043 — 4,337 Gross profit 66,222 3,086 (1,855) 67,453 Selling, general and administrative expenses 26,486 4,799 10,657 41,942 Depreciation and amortization attributable to operating expenses 808 38 170 1,016 Income (loss) from operations 38,928 (1,751) (12,682) 24,495 Other income (expenses) Other income (expense) — 1,655 (2) 1,653 Loss on change in derivative liability — — (9,185) (9,185) Interest expense (3,876) (57) (8,544) (12,477) Total other income (expense) (3,876) 1,598 (17,731) (20,009) Income (loss) from continuing operations before income tax $ 35,052 $ (153) $ (30,413) $ 4,486 Capital expenditures $ 69,908 $ 4,028 $ — $ 73,936 Total assets by segment were as follows (in thousands): As of March 31, 2024 Refining & Black Oil & Recovery Corporate and Eliminations Consolidated Total assets $ 655,271 $ 110,131 $ 69,651 $ 835,053 As of December 31, 2023 Refining & Black Oil & Recovery Corporate and Eliminations Consolidated Total assets $ 661,101 $ 106,524 $ 86,999 $ 854,624 Segment assets for the Refining and Marketing and Black Oil and Recovery segments consist of property, plant, and equipment, right-of-use assets, intangible assets, accounts receivable, inventories and other assets. Assets for the corporate unallocated amounts consist of property, plant, and equipment used at the corporate headquarters, intangible assets, derivative commodity assets and cash. |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 3 Months Ended |
Mar. 31, 2024 | |
Receivables [Abstract] | |
ACCOUNTS RECEIVABLE | ACCOUNTS RECEIVABLE Accounts receivable, net, consists of the following at March 31, 2024 and December 31, 2023 (in thousands): March 31, 2024 December 31, 2023 Accounts receivable trade $ 42,886 $ 37,473 Allowance for credit losses (1,327) (1,309) Accounts receivable, net $ 41,559 $ 36,164 Accounts receivable trade represents amounts due from customers. Accounts receivable trade are recorded at invoiced amounts, net of reserves and allowances and do not bear interest. The provision for credit losses was $19.0 thousand and $881.7 thousand for continued operations for the three months ended March 31, 2024 and 2023, respectively. |
CONCENTRATIONS OF RISK AND SIGN
CONCENTRATIONS OF RISK AND SIGNIFICANT CUSTOMERS | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONCENTRATIONS OF RISK AND SIGNIFICANT CUSTOMERS | CONCENTRATIONS OF RISK AND SIGNIFICANT CUSTOMERS The Company has concentrated credit risk for cash by maintaining deposits in one bank. These balances are insured by the Federal Deposit Insurance Corporation up to $250,000. From time to time during the quarter ended March 31, 2024 and year ended December 31, 2023, the Company’s cash balances exceeded the federally insured limits. No losses have been incurred relating to this concentration. At March 31, 2024 and 2023 and for each of the three months then ended, the Company’s revenues and receivables were comprised of the following customer concentrations: As of and for the Three Months Ended March 31, 2024 March 31, 2023 % of % of % of % of Customer 1 35% 2% 38% 23% Customer 2 30% 4% 37% 1% Customer 3 10% 22% —% —% For each of the three months ended March 31, 2024 and 2023, the Company’s segment revenues were comprised of the following customer concentrations: % of Revenue by Segment % Revenue by Segment March 31, 2024 March 31, 2023 Refining Black Oil and Recovery Refining Black Oil and Recovery Customer 1 37% —% 39% —% Customer 2 31% —% 39% —% Customer 3 11% —% —% —% For each of the three months ended March 31, 2024 and 2023, substantially all of the Company's crude oil, which is used in our Refining and Marketing segment, is purchased from a single vendor. The Company’s revenue, profitability and future rate of growth are substantially dependent on prevailing prices for petroleum-based products. Historically, the energy markets have been very volatile, and there can be no assurance that these prices will not be subject to wide fluctuations in the future. A substantial or extended decline in such prices could have a material adverse effect on the Company’s financial position, results of operations, cash flows, and access to capital and on the quantities of petroleum-based products that the Company can economically produce. |
INVENTORY
INVENTORY | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
INVENTORY | INVENTORY The following table describes the Company's inventory balances by category (in thousands): As of March 31, 2024 As of December 31, 2023 Crude oil $ 72,966 $ 60,702 Renewable feedstocks 24,920 27,450 Refined products 98,699 91,911 Re-refined products 2,394 2,057 Total hydrocarbon inventories $ 198,979 $ 182,120 The following table summarizes our outstanding obligations under our inventory financing agreements (in thousands): March 31, 2024 December 31, 2023 Obligations under inventory financing agreements $ 169,656 $ 141,343 Unamortized financing cost — (250) Obligations under inventory financing agreements, net $ 169,656 $ 141,093 The valuation of our obligations at the end of each reporting period requires that we make estimates of the prices and differentials for our then monthly forward purchase obligations. Supply and Offtake Agreement On April 1, 2022 (the “ Commencement Date ”), Vertex Refining Alabama, LLC (“Vertex Refining”), and the Company, entered into a Supply and Offtake Agreement (the “ Supply and Offtake Agreement ”) with Macquarie Energy North American Trading Inc (“Macquarie”), pertaining to crude oil supply and offtake of finished products located at the Mobile Refinery acquired on April 1, 2022. Under the Supply and Offtake Agreement, Macquarie purchases the majority of the crude oil utilized at the Mobile Refinery and holds legal title prior to its sale to Vertex Refining for consumption within the Mobile Refinery processing units. Also pursuant to the Supply and Offtake Agreement, Macquarie purchases from Vertex Refining substantially all of the Mobile Refinery’s output of certain refined products and owns such refined products while they are located within certain specified locations at the Mobile Refinery. Macquarie takes title to the refined products stored in our storage tanks until they are sold. We record the inventory owned by Macquarie on our behalf as inventory with a corresponding accrued liability on our balance sheet because we maintain the risk of loss until the refined products are sold to third parties and we have an obligation to repurchase any unsold inventory. Pursuant to the Supply and Offtake Agreement and subject to the terms and conditions therein, Macquarie may during the term of the Supply and Offtake Agreement procure crude oil and refined products from certain third parties which may be sold to Vertex Refining or third parties pursuant to the Supply and Offtake Agreement and may sell refined products to Vertex Refining or third parties (including customers of Vertex Refining). The Supply and Offtake Agreement expires March 31, 2024, subject to the performance of customary covenants, and certain events of default and termination events provided therein, for a facility of that size and type. The agreement automatically extends for another 12 months after the end of the initial term, unless terminated prior to such date by either party with 180 days prior written notice. Neither party exercised the termination clause. Amendment No. 1 to Supply and Offtake Agreement On May 26. 2023, in connection with the entry into the RD Supply and Offtake Agreement, discussed below, Macquarie, Vertex Refining and the Company, entered into Amendment Agreement No. 1 to the Supply and Offtake Agreement (“ Amendment 1 ”). Pursuant to Amendment 1, the Supply and Offtake Agreement was amended to include certain additional documents relating to the RD Supply and Offtake Agreement as transaction documents, and to update such Supply and Offtake Agreement in connection therewith, to amend the unwind procedures associated with the Supply and Offtake Agreement, and to update or revise certain other covenants set forth in the Supply and Offtake Agreement relating to cross defaults, finance agreements, minimum liquidity, and guarantor requirements, to be conformed with changes made to analogous provisions in, or to otherwise account for, the RD Supply and Offtake Agreement terms. Amendment 1 also made conforming amendments to certain other agreements relating to the Supply and Offtake Agreement. Renewables RD Supply and Offtake Agreement On May 26, 2023 (the “ Commencement Date ”), Vertex Renewables Alabama, LLC, an affiliate indirectly wholly-owned by the Company (“ Vertex Renewables ”), entered into a Supply and Offtake Agreement (the “ RD Supply and Offtake Agreement ”, and together with the Supply and Offtake Agreement, the “ Supply and Offtake Agreements ”) with Macquarie, pertaining to the supply and financing of renewable biomass feedstocks used for the production of renewable fuels, the offtake and financing of renewable diesel, and the provision of certain financing accommodations with respect to certain agreed environmental attributes associated with the operation of such renewable diesel unit (including Renewable Identification Numbers (RINs), tax credits, and low carbon fuel credits) at the Mobile Refinery. The RD Supply and Offtake Agreement has a 24 month term following the Effective Date, which was May 26, 2023, subject to the performance of customary covenants, and may be terminated earlier following the occurrence of certain events of default and termination events provided therein that are customary for a facility of this size and type and subject to applicable cure periods in certain events. Additionally, either party may terminate the agreement at any time, for any reason, with not less than 180 days prior notice to the other. In the event Vertex Renewables is the terminating party, Vertex Refining must also at the same time, terminate that certain Supply and Offtake Agreement entered into with Macquarie dated April 1, 2022. Pursuant to the Supply and Offtake Agreement, we pay or receive certain fees from Macquarie based on changes in market prices over time. The following table summarizes the inventory intermediation fees, interest expenses and financing costs (in thousands): Three Months Ended March 31, 2024 2023 Intermediation fees (include over/under) $ (41) $ 2,064 Inventory financing fees $ 2,063 $ 2,295 Interest expense and financing costs, net $ 2,959 $ 2,520 The intermediation fees are included in the cost of revenues on the consolidated statement of operations for three months ended March 31, 2024 and 2023. |
INVENTORY FINANCING AGREEMENTS
INVENTORY FINANCING AGREEMENTS | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
INVENTORY FINANCING AGREEMENTS | INVENTORY The following table describes the Company's inventory balances by category (in thousands): As of March 31, 2024 As of December 31, 2023 Crude oil $ 72,966 $ 60,702 Renewable feedstocks 24,920 27,450 Refined products 98,699 91,911 Re-refined products 2,394 2,057 Total hydrocarbon inventories $ 198,979 $ 182,120 The following table summarizes our outstanding obligations under our inventory financing agreements (in thousands): March 31, 2024 December 31, 2023 Obligations under inventory financing agreements $ 169,656 $ 141,343 Unamortized financing cost — (250) Obligations under inventory financing agreements, net $ 169,656 $ 141,093 The valuation of our obligations at the end of each reporting period requires that we make estimates of the prices and differentials for our then monthly forward purchase obligations. Supply and Offtake Agreement On April 1, 2022 (the “ Commencement Date ”), Vertex Refining Alabama, LLC (“Vertex Refining”), and the Company, entered into a Supply and Offtake Agreement (the “ Supply and Offtake Agreement ”) with Macquarie Energy North American Trading Inc (“Macquarie”), pertaining to crude oil supply and offtake of finished products located at the Mobile Refinery acquired on April 1, 2022. Under the Supply and Offtake Agreement, Macquarie purchases the majority of the crude oil utilized at the Mobile Refinery and holds legal title prior to its sale to Vertex Refining for consumption within the Mobile Refinery processing units. Also pursuant to the Supply and Offtake Agreement, Macquarie purchases from Vertex Refining substantially all of the Mobile Refinery’s output of certain refined products and owns such refined products while they are located within certain specified locations at the Mobile Refinery. Macquarie takes title to the refined products stored in our storage tanks until they are sold. We record the inventory owned by Macquarie on our behalf as inventory with a corresponding accrued liability on our balance sheet because we maintain the risk of loss until the refined products are sold to third parties and we have an obligation to repurchase any unsold inventory. Pursuant to the Supply and Offtake Agreement and subject to the terms and conditions therein, Macquarie may during the term of the Supply and Offtake Agreement procure crude oil and refined products from certain third parties which may be sold to Vertex Refining or third parties pursuant to the Supply and Offtake Agreement and may sell refined products to Vertex Refining or third parties (including customers of Vertex Refining). The Supply and Offtake Agreement expires March 31, 2024, subject to the performance of customary covenants, and certain events of default and termination events provided therein, for a facility of that size and type. The agreement automatically extends for another 12 months after the end of the initial term, unless terminated prior to such date by either party with 180 days prior written notice. Neither party exercised the termination clause. Amendment No. 1 to Supply and Offtake Agreement On May 26. 2023, in connection with the entry into the RD Supply and Offtake Agreement, discussed below, Macquarie, Vertex Refining and the Company, entered into Amendment Agreement No. 1 to the Supply and Offtake Agreement (“ Amendment 1 ”). Pursuant to Amendment 1, the Supply and Offtake Agreement was amended to include certain additional documents relating to the RD Supply and Offtake Agreement as transaction documents, and to update such Supply and Offtake Agreement in connection therewith, to amend the unwind procedures associated with the Supply and Offtake Agreement, and to update or revise certain other covenants set forth in the Supply and Offtake Agreement relating to cross defaults, finance agreements, minimum liquidity, and guarantor requirements, to be conformed with changes made to analogous provisions in, or to otherwise account for, the RD Supply and Offtake Agreement terms. Amendment 1 also made conforming amendments to certain other agreements relating to the Supply and Offtake Agreement. Renewables RD Supply and Offtake Agreement On May 26, 2023 (the “ Commencement Date ”), Vertex Renewables Alabama, LLC, an affiliate indirectly wholly-owned by the Company (“ Vertex Renewables ”), entered into a Supply and Offtake Agreement (the “ RD Supply and Offtake Agreement ”, and together with the Supply and Offtake Agreement, the “ Supply and Offtake Agreements ”) with Macquarie, pertaining to the supply and financing of renewable biomass feedstocks used for the production of renewable fuels, the offtake and financing of renewable diesel, and the provision of certain financing accommodations with respect to certain agreed environmental attributes associated with the operation of such renewable diesel unit (including Renewable Identification Numbers (RINs), tax credits, and low carbon fuel credits) at the Mobile Refinery. The RD Supply and Offtake Agreement has a 24 month term following the Effective Date, which was May 26, 2023, subject to the performance of customary covenants, and may be terminated earlier following the occurrence of certain events of default and termination events provided therein that are customary for a facility of this size and type and subject to applicable cure periods in certain events. Additionally, either party may terminate the agreement at any time, for any reason, with not less than 180 days prior notice to the other. In the event Vertex Renewables is the terminating party, Vertex Refining must also at the same time, terminate that certain Supply and Offtake Agreement entered into with Macquarie dated April 1, 2022. Pursuant to the Supply and Offtake Agreement, we pay or receive certain fees from Macquarie based on changes in market prices over time. The following table summarizes the inventory intermediation fees, interest expenses and financing costs (in thousands): Three Months Ended March 31, 2024 2023 Intermediation fees (include over/under) $ (41) $ 2,064 Inventory financing fees $ 2,063 $ 2,295 Interest expense and financing costs, net $ 2,959 $ 2,520 The intermediation fees are included in the cost of revenues on the consolidated statement of operations for three months ended March 31, 2024 and 2023. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 3 Months Ended |
Mar. 31, 2024 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | PREPAID EXPENSES AND OTHER CURRENT ASSETS The following table describes the Company's prepaid expenses and other current assets balances (in thousands): As of March 31, 2024 As of December 31, 2023 Prepaid insurance $ 1,950 $ 8,076 Commodity derivative advance 1,724 1,502 Sulfur credits 603 3,462 Prepaid feedstock 1,831 9,845 Prepaid freight 3,243 3,260 Prepaid operating expenses 3,429 4,756 Inventory financing deposit 18,618 15,259 Derivative commodity assets — 11 Other current assets 7,275 7,003 Total prepaid expenses & other current assets $ 38,673 $ 53,174 |
FIXED ASSETS, NET
FIXED ASSETS, NET | 3 Months Ended |
Mar. 31, 2024 | |
Property, Plant and Equipment [Abstract] | |
FIXED ASSETS, NET | FIXED ASSETS, NET Fixed assets consist of the following (in thousands): Useful Life March 31, 2024 December 31, 2023 Equipment 7 - 20 $ 287,067 $ 276,331 Leasehold improvements 15 2,877 2,852 Office equipment & furniture 5 - 7 1,446 1,446 Vehicles 5 15,796 15,087 Building 20 3,912 3,663 Turnarounds 4 19,388 21,100 Construction in progress 55,043 53,467 Land 9,120 9,439 Land improvement 15 972 354 Total fixed assets 395,621 383,739 Less accumulated depreciation (62,672) (57,628) Net fixed assets $ 332,949 $ 326,111 The increase in fixed assets is due to the investment in the conventional refinery project at the Mobile Refinery, which began April 1, 2022, and which includes construction in progress. Depreciation expense was $7.2 million a nd $3.6 million for the three months ended March 31, 2024 and 2023, respectively, for the continued operations. In addition, we sold a portion of land at the Mobile Refinery for $2.6 million for purposes of building a rail road spur at the facility site. Asset Retirement Obligations: The Company has asset retirement obligations with respect to certain of its refinery assets due to various legal obligations to clean and/or dispose of various component parts of each refinery at the time they are retired. However, these component parts can be used for extended and indeterminate periods of time as long as they are properly maintained and/or upgraded. It is the Company’s practice and current intent to maintain its refinery assets and continue making improvements to those assets based on technological advances. As a result, the Company believes that its refinery assets have indeterminate lives for purposes of estimating asset retirement obligations because dates, or ranges of dates, upon which the Company would retire refinery assets cannot reasonably be estimated. When a date or range of dates can reasonably be estimated for the retirement of any component part of a refinery, the Company estimates the cost of performing the retirement activities and records a liability for the fair value of that cost using established present value techniques. |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS, NET | INTANGIBLE ASSETS, NET Components of intangible assets (subject to amortization) consist of the following items (in thousands): March 31, 2024 December 31, 2023 Useful Life (in years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relations 5 $ 1,658 $ 1,023 $ 635 $ 1,658 $ 989 $ 669 Vendor relations 10 4,778 4,657 121 4,778 4,639 139 Trademark/Trade name 15 887 669 218 887 657 230 Technology/Patent 15 - 30 15,787 10,021 5,766 15,787 9,780 6,007 Software and cloud 3 10,419 6,370 4,049 10,067 5,571 4,496 $ 33,529 $ 22,740 $ 10,789 $ 33,177 $ 21,636 $ 11,541 Intangible assets are amortized on a straight-line basis. We continually evaluate the amortization period and carrying basis of intangible assets to determine whether subsequent events and circumstances warrant a revised estimated useful life or reduction in value. Total amortization expense of intangibles was $1.1 million and $1.0 million for the three months ended March 31, 2024 and 2023, respectively. Estimated future amortization expense is as follows (in thousands): March 31, Balance 2025 $ 4,458 2026 1,412 2027 1,383 2028 1,006 2029 510 Thereafter 2,020 $ 10,789 |
ACCRUED LIABILITIES
ACCRUED LIABILITIES | 3 Months Ended |
Mar. 31, 2024 | |
Payables and Accruals [Abstract] | |
ACCRUED LIABILITIES | ACCRUED LIABILITIES Accrued expenses and other current liabilities consisted of the following (in thousands): March 31, 2024 December 31, 2023 Accrued purchases $ 10,020 17,685 Accrued interest 321 460 Accrued compensation and benefits 6,206 7,605 Accrued taxes other than payroll taxes 2,223 826 RINS obligations 44,395 46,153 Benzene credits obligations 311 531 Unearned revenue 5,278 325 Environmental liabilities - current 51 51 Derivative commodity liability 435 — $ 69,240 $ 73,636 |
FINANCING ARRANGEMENTS
FINANCING ARRANGEMENTS | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
FINANCING ARRANGEMENTS | FINANCING AGREEMENTS The Company's long-term debt consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands): Creditor Loan Type Balance at March 31, 2024 Balance at December 31, 2023 Senior Convertible Note Convertible note $ 15,230 $ 15,230 Term Loan 2025 Loan 195,950 195,950 Citizens National Bank - Promissory Note Loan 2,611 — Various institutions Short-term note 2,399 6,237 Principal amount of long-term debt 216,190 217,417 Less: unamortized discount and deferred financing costs (25,894) (30,354) Total debt, net of unamortized discount and deferred financing costs 190,296 187,063 Less: current maturities, net of unamortized discount and deferred financing costs (12,524) (16,362) Long-term debt, net of current maturities $ 177,772 $ 170,701 Future maturities of long-term debt, excluding financing lease obligations, as of March 31, 2024 are summarized as follows (in thousands): Period Ended March 31, Amount Due 2025 $ 12,524 2026 185,825 2027 — 2028 15,230 2029 2,611 Total $ 216,190 Short-Term Loan The Company financed insurance premiums through various financial institutions bearing interest at rates ranging from 3.24% to 6.25% per annum. All such premium finance agreements have maturities of less than one year and have a balance of $1.4 million at March 31, 2024 and $4.9 million at December 31, 2023. The Company has a short-term promissory note for the purchase of assets bearing 8.5% interest per annum, with an outstanding balance of $1.0 million at March 31, 2024 and $1.3 million at December 31, 2023. Promissory Note The Company has a long-term promissory note for the purchase of assets with an outstanding balance of $2.6 million bearing 7.83% interest rate per annum at March 31, 2024. Term Loan Vertex Refining, the Company, as a guarantor, substantially all of the Company’s direct and indirect subsidiaries, as guarantors, certain funds as lenders (the “Lenders”), and Cantor Fitzgerald Securities, in its capacity as administrative agent and collateral agent for the Lenders (the “Agent”), entered into a Loan and Security Agreement on April 1, 2022 (as amended from time to time, the “Loan and Security Agreement”). On September 30, 2022, the parties entered into a second amendment to the Loan and Security Agreement which (a) extended the date that the Company was required to begin initial commercial production of renewable diesel at the Mobile Refinery, from February 28, 2023 to April 28, 2023 (which date the Lenders subsequently further agreed to extend until July 14, 2023), and provided other corresponding extensions of the milestones required to complete the Company’s capital project designed to modify the Mobile Refinery’s existing hydrocracking unit to produce renewable diesel fuel on a standalone basis, which mechanical completion was achieved in March 2023; and (b) waived and extended certain deadlines and time periods for the Company to take other actions in connection with the Loan and Security Agreement. On December 28, 2023, the parties entered into a fifth amendment to the Loan and Security Agreement (a) pursuant to which certain of the Lenders (the “Additional Lenders”) agreed to provide an additional term loan in the amount of $50 million (the “Additional Term Loan”, and together with the existing term loans, the “Term Loan”); and (b) the Lenders waived certain technical events of default which had occurred under the Loan and Security Agreement, mainly relating to monetary thresholds for indebtedness and investments; and to include certain other mutually negotiated changes to the Loan and Security Agreement. Amounts outstanding under the existing Term Loan mature at April 1, 2025, and bear interest at a rate per annum equal to the sum of (i) the greater of (x) the per annum rate publicly quoted from time to time by The Wall Street Journal as the “Prime Rate” in the United States minus 1.50% as in effect on such day and (y) the Federal Funds rate for such day plus 0.50%, subject in the case of this clause (i), to a floor of 1.0%, plus (ii) 10.25%, currently 17.25%. Interest is payable in cash (i) quarterly, in arrears, on the last business day of each calendar quarter, commencing on the last business day of the calendar quarter ending March 28, 2024, (ii) in connection with any payment, prepayment or repayment of the Term Loans, and (iii) at maturity (whether upon demand, by acceleration or otherwise). Pursuant to the Loan and Security Agreement, on the last day of March, June, September and December of each year (or if such day is not a business day, the next succeeding business day), beginning on June 28, 2024 and ending on December 31, 2024, Vertex Refining Alabama LLC (“Vertex Refining”) is required to repay $2,687,500 of the principal amount of the Term Loans, subject to reductions in the event of any prepayment of the Loan and Security Agreement. Pursuant to the Loan and Security Agreement, the Lenders agreed to provide a $215.0 million term loan to Vertex Refining (the “Term Loan”). On March 22, 2024, the Lenders entered into a limited consent with all of the parties to the Term Loan, and consented to the Company selling certain real property (land) located at the Mobile Refinery for $4.1 million to build out a rail spur at the refinery site. The payment of $1.5 million of this total amount is contingent upon the completion of the Company's infrastructure such that the railroad can access the Mobile Refinery. On March 28, 2024, the Lenders entered into a limited consent with all of the parties to the Term Loan, and consented to the Company postponing the mandatory prepayment of an aggregated principal amount of $2.1 million and interest of $9.4 million related to the Term Loan, which would have otherwise been due on the last business day of the calendar quarter ending March 31, 2024, until April 15, 2024, which payment was made on such date. Warrant Agreement and Derivative Liabilities In connection with the Loan and Security Agreement, and as additional consideration for the Lenders agreeing to loan funds to the Company thereunder, the Company granted warrants to purchase 2.75 million shares of common stock of the Company with an exercise price of $4.50 per share, to the Lenders (and/or their affiliates) on April 1, 2022 (the “ Initial Warrants ”). The terms of the warrants are set forth in a Warrant Agreement (the “ April 2022 Warrant Agreement ”) entered into on April 1, 2022, between the Company and Continental Stock Transfer & Trust Company as warrant agent. In connection with the entry into Amendment No. One to Loan and Security Agreement, and as a required term and condition thereof, on May 26, 2022, the Company granted warrants (the “ Additional Warrants ” and together with the Initial Warrants, the “ Warrants ”) to purchase 0.25 million shares of the Company’s common stock with an exercise price of $9.25 per share, to the Additional Lenders and their affiliates. The terms of the Additional Warrants are set forth in a Warrant Agreement (the “ May 2022 Warrant Agreement ” and together with the April 2022 Warrant Agreement, the “ Prior Warrant Agreements ”) entered into on May 26, 2022, between the Company and Continental Stock Transfer & Trust Company as warrant agent. In connection with the entry into Amendment No. Five to Loan and Security Agreement, and as a required term and condition thereof, on December 28, 2023, the Company granted warrants (the “ New Warrants ”) to purchase 1.0 million shares of the Company’s common stock with an exercise price of $3.00 per share, to certain lenders and their affiliates. As additional consideration for the Lenders agreeing to Amendment No. Five to Loan Agreement, the Company agreed to reprice the Prior Warrants to have an exercise price of $3.00 per share (the “Warrant Repricing”). Each Warrant holder has a put right to require the Company to repurchase any portion of the Warrants held by such holder concurrently with the consummation of a fundamental transaction, as detailed in the applicable Warrant Agreement. The fundamental transaction clause requires the Warrants to be classified as liabilities. The fair value of the Warrants is presented in “ Note 19. Fair Value Measurements ”, and warrant activities are presented in “ Note 17. Equity ”. Indenture and Convertible Senior Notes On November 1, 2021, we issued $155 million aggregate principal amount at maturity of our 6.25% Convertible Senior Notes due 2027 (the “ Convertible Senior Notes ”) pursuant to an Indenture (the “ Indenture ”), dated November 1, 2021, between the Company and U.S. Bank National Association, as trustee (the “ Trustee ”), in a private offering to persons reasonably believed to be “qualified institutional buyers” and/or to “accredited investors” in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, pursuant to Securities Purchase Agreements. The issue price was 90% of the face amount of each note. Interest payments on the Notes are paid semiannually on April 1 and October 1 of each year, beginning on April 1, 2022. During the year ended December 31, 2022, holders of an aggregate of $60 million of the Convertible Senior Notes due 2027, converted such notes into 10.2 million shares of common stock of the Company pursuant to the terms of the Indenture. Upon the conversion, the Company recognized $33.9 million of unamortized deferred loan cost and discount as interest expense. On June 12, 2023, pursuant to the terms of certain separate, privately negotiated exchange agreements, the holders of $79.9 million principal amount of the Convertible Senior Notes due 2027, exchanged such principal amount of notes for an aggregate of 17.2 million newly issued shares of common stock. The Company also paid an aggregate of $1.0 million in cash to satisfy accrued and unpaid interest on the converted notes through the closing date of the exchanges. Upon the exchange, the Company recognized $40.7 million unamortized deferred loan cost and discount and $21.2 million in inducement cost as interest expense. The components of the Convertible Senior Notes are presented as follows (in thousands) : March 31, 2024 December 31, 2023 Principal amounts at beginning of period $ 15,230 $ 95,178 Conversion of principal into common stock — (79,948) Outstanding principal amount 15,230 15,230 Unamortized discount and issuance costs (6,865) (7,157) Net carrying amount at end of period $ 8,365 $ 8,073 |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
LEASES | LEASES Finance Leases The Company's finance lease liabilities consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands): Creditor Loan Type March 31, 2024 December 31, 2023 Matheson Tri-Gas Finance Lease $ 43,816 $ 44,132 Plaquemines Finance Lease 940 994 Harvey Ford Finance Lease 36 39 DLL financial Finance Lease 45 47 Diego Finance Lease 139 137 Xerox Finance Lease 16 — Centerpoint Blakely Finance Lease 23,081 23,292 $ 68,073 $ 68,641 Future maturities of finance lease obligations, as of March 31, 2024, are summarized as follows (in thousands): Period Ended March 31, Amount Due 2025 $ 8,459 2026 8,462 2027 8,455 2028 27,847 2029 6,588 Thereafter 56,240 Total lease payments 116,051 Less: interest (47,978) Present value of financing lease liabilities 68,073 Less: current portion of lease liabilities (2,497) Total lease liabilities, net of current portion $ 65,576 The following table summarizes the lease cost recognized in our consolidated statements of operations (in thousands): Three Months Ended March 31, Lease Cost Type 2024 2023 Amortization of finance lease ROU assets $ 993 $ 784 Interest on lease liabilities 1,522 1,382 Net finance lease costs $ 2,515 $ 2,166 Operating Leases Operating leases are included in operating lease right-of-use lease assets, and operating current and long-term lease liabilities on the consolidated balance sheets. Lease expense for operating leases is recognized on a straight-line basis over the lease term. Variable lease expense is recognized in the period in which the obligation for those payments is incurred. Lease expense for equipment is included in cost of revenues and other rents are included in selling, general and administrative expense on the unaudited consolidated statements of operations. The following table summarizes the operating lease costs recognized (in thousands): Three Months Ended March 31, Lease Cost Type 2024 2023 Operating lease cost $ 7,499 $ 3,070 Variable lease cost 659 260 Short-term lease cost 6,651 1,929 Net lease cost $ 14,809 $ 5,259 Cash Flows The following table summarizes the supplemental cash flow information related to leases as follows (in thousands): Three Months Ended March 31, Lease Cost Type 2024 2023 Cash paid for amounts included in the measurement of liabilities Payments on financing lease $ 586 $ 310 Payments on operating lease $ 7,499 $ 3,070 Non-cash supplemental amounts ROU assets obtained from new finance lease liabilities $ 18 $ 15,024 ROU assets obtained from new operating lease liabilities $ 74 $ 15,078 ROU assets terminated from release of operating lease liabilities $ (17,666) $ — Maturities of our lease liabilities for all operating leases are as follows as of March 31, 2024 (in thousands): For the period ending March 31, Facilities Equipment Plant Railcar Total 2025 $ 975 $ 12,300 $ 8,009 $ 687 $ 21,971 2026 818 6,512 7,721 567 15,618 2027 631 5,058 7,745 246 13,680 2028 606 3,438 7,603 104 11,751 2029 545 — 6,946 — 7,491 Thereafter 1,293 — 72,072 — 73,365 Total lease payments 4,868 27,308 110,096 1,604 143,876 Less: interest (1,391) (4,269) (60,455) (135) (66,250) Present value of operating lease liabilities 3,477 23,039 49,641 1,469 77,626 Less: current portion of lease liabilities (621) (10,076) (2,025) (559) (13,281) Total lease liabilities, net of current portion $ 2,856 $ 12,963 $ 47,616 $ 910 $ 64,345 The weighted average remaining lease terms and discount rates for all of our financing lease and operating leases were as follows as of March 31, 2024: Remaining lease term and discount rate: March 31, 2024 Operating lease Financing lease Weighted average remaining lease terms (years) Lease facilities 4.94 — Lease equipment 1.90 3.87 Lease plant 13.55 14.16 Lease railcar 2.21 — Weighted average discount rate Lease facilities 11.07 % — % Lease equipment 12.11 % 9.19 % Lease plant 12.31 % 8.89 % Lease railcar 10.72 % — % Significant Judgments Significant judgments include the discount rates applied, the expected lease terms, lease renewal options and residual value guarantees. There are several leases with renewal options or purchase options. The purchase options are not expected to have a material impact on the lease obligation. There are several facility and plant leases which have lease renewal options ranging from one |
LEASES | LEASES Finance Leases The Company's finance lease liabilities consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands): Creditor Loan Type March 31, 2024 December 31, 2023 Matheson Tri-Gas Finance Lease $ 43,816 $ 44,132 Plaquemines Finance Lease 940 994 Harvey Ford Finance Lease 36 39 DLL financial Finance Lease 45 47 Diego Finance Lease 139 137 Xerox Finance Lease 16 — Centerpoint Blakely Finance Lease 23,081 23,292 $ 68,073 $ 68,641 Future maturities of finance lease obligations, as of March 31, 2024, are summarized as follows (in thousands): Period Ended March 31, Amount Due 2025 $ 8,459 2026 8,462 2027 8,455 2028 27,847 2029 6,588 Thereafter 56,240 Total lease payments 116,051 Less: interest (47,978) Present value of financing lease liabilities 68,073 Less: current portion of lease liabilities (2,497) Total lease liabilities, net of current portion $ 65,576 The following table summarizes the lease cost recognized in our consolidated statements of operations (in thousands): Three Months Ended March 31, Lease Cost Type 2024 2023 Amortization of finance lease ROU assets $ 993 $ 784 Interest on lease liabilities 1,522 1,382 Net finance lease costs $ 2,515 $ 2,166 Operating Leases Operating leases are included in operating lease right-of-use lease assets, and operating current and long-term lease liabilities on the consolidated balance sheets. Lease expense for operating leases is recognized on a straight-line basis over the lease term. Variable lease expense is recognized in the period in which the obligation for those payments is incurred. Lease expense for equipment is included in cost of revenues and other rents are included in selling, general and administrative expense on the unaudited consolidated statements of operations. The following table summarizes the operating lease costs recognized (in thousands): Three Months Ended March 31, Lease Cost Type 2024 2023 Operating lease cost $ 7,499 $ 3,070 Variable lease cost 659 260 Short-term lease cost 6,651 1,929 Net lease cost $ 14,809 $ 5,259 Cash Flows The following table summarizes the supplemental cash flow information related to leases as follows (in thousands): Three Months Ended March 31, Lease Cost Type 2024 2023 Cash paid for amounts included in the measurement of liabilities Payments on financing lease $ 586 $ 310 Payments on operating lease $ 7,499 $ 3,070 Non-cash supplemental amounts ROU assets obtained from new finance lease liabilities $ 18 $ 15,024 ROU assets obtained from new operating lease liabilities $ 74 $ 15,078 ROU assets terminated from release of operating lease liabilities $ (17,666) $ — Maturities of our lease liabilities for all operating leases are as follows as of March 31, 2024 (in thousands): For the period ending March 31, Facilities Equipment Plant Railcar Total 2025 $ 975 $ 12,300 $ 8,009 $ 687 $ 21,971 2026 818 6,512 7,721 567 15,618 2027 631 5,058 7,745 246 13,680 2028 606 3,438 7,603 104 11,751 2029 545 — 6,946 — 7,491 Thereafter 1,293 — 72,072 — 73,365 Total lease payments 4,868 27,308 110,096 1,604 143,876 Less: interest (1,391) (4,269) (60,455) (135) (66,250) Present value of operating lease liabilities 3,477 23,039 49,641 1,469 77,626 Less: current portion of lease liabilities (621) (10,076) (2,025) (559) (13,281) Total lease liabilities, net of current portion $ 2,856 $ 12,963 $ 47,616 $ 910 $ 64,345 The weighted average remaining lease terms and discount rates for all of our financing lease and operating leases were as follows as of March 31, 2024: Remaining lease term and discount rate: March 31, 2024 Operating lease Financing lease Weighted average remaining lease terms (years) Lease facilities 4.94 — Lease equipment 1.90 3.87 Lease plant 13.55 14.16 Lease railcar 2.21 — Weighted average discount rate Lease facilities 11.07 % — % Lease equipment 12.11 % 9.19 % Lease plant 12.31 % 8.89 % Lease railcar 10.72 % — % Significant Judgments Significant judgments include the discount rates applied, the expected lease terms, lease renewal options and residual value guarantees. There are several leases with renewal options or purchase options. The purchase options are not expected to have a material impact on the lease obligation. There are several facility and plant leases which have lease renewal options ranging from one |
EQUITY
EQUITY | 3 Months Ended |
Mar. 31, 2024 | |
Equity [Abstract] | |
EQUITY | EQUITY Common Stock The total number of authorized shares of the Company’s common stock is 750 million shares, $0.001 par value per share. As of March 31, 2024 and December 31, 2023, there were 93,514,346 and 93,514,346, respectively, shares of common stock issued and outstanding. Each share of the Company's common stock is entitled to equal dividends and distributions per share with respect to the common stock when, as and if declared by the Company's board of directors. No holder of any shares of the Company's common stock has a preemptive right to subscribe for any of the Company's securities, nor are any shares of the Company's common stock subject to redemption or convertible into other securities. Upon liquidation, dissolution or winding-up of the Company and after payment of creditors and preferred shareholders of the Company, if any, the assets of the Company will be divided pro rata on a share-for-share basis among the holders of the Company's common stock. Each share of the Company's common stock is entitled to one vote. Shares of the Company's common stock do not possess any cumulative voting rights. During the three months ended March 31, 2023, the Company issued 166,000 shares of common stock in connection with the exercise of options. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE The following is a reconciliation of the numerator and denominator for basic and diluted income (loss) per share for the three months ended March 31, 2024 and 2023 (in thousands, except per share amounts): Three Months Ended March 31, 2024 2023 Basic income (loss) per Share Numerator: Net income (loss) attributable to shareholders from continuing operations $ (17,734) $ 3,523 Net income attributable to shareholders from discontinued operations, net of tax — 50,340 Net income (loss) attributable to common shareholders $ (17,734) $ 53,863 Denominator: Weighted-average common shares outstanding 93,514 75,689 Basic income (loss) per common shares Continuing operations $ (0.19) $ 0.05 Discontinued operations, net of tax — 0.66 Basic income (loss) per share $ (0.19) $ 0.71 Diluted Income (Loss) per Share Numerator: Net income (loss) attributable to shareholders from continuing operations $ (17,734) $ 3,523 Net income available to shareholders from discontinued operations, net of tax — 50,340 Net income (loss) available to common shareholders $ (17,734) $ 53,863 Denominator: Weighted-average shares outstanding 93,514 75,689 Effect of dilutive securities* Stock options and warrants — 3,307 Diluted weighted-average shares outstanding 93,514 78,996 Diluted income (loss) per common shares Continuing operations $ (0.19) $ 0.04 Discontinued operations, net of tax — 0.64 Diluted income (loss) per share $ (0.19) $ 0.68 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The following tables present assets and liabilities accounted for at fair value on a recurring basis as of March 31, 2024 and December 31, 2023 (in thousands): As of March 31, 2024 Level 1 Level 2 Level 3 Total Assets at fair value Environmental credits $ — $ 603 $ — $ 603 Total assets at fair value — 603 — 603 Liabilities at fair value Commodity — (435) — (435) RINS and environmental credits — (44,706) — (44,706) Derivative warrants — — (3,249) (3,249) Total liabilities at fair value — (45,141) (3,249) (48,390) Total $ — $ (44,538) $ (3,249) $ (47,787) As of December 31, 2023 Level 1 Level 2 Level 3 Total Assets at fair value Commodity $ — $ 11 $ — $ 11 Total assets at fair value — 11 — 11 Liabilities at fair value RINS and environmental credits — (46,684) — (46,684) Derivative warrants — — (9,907) (9,907) Total liabilities at fair value — (46,684) (9,907) (56,591) Total $ — $ (46,673) $ (9,907) $ (56,580) Level 3 instruments include the Initial Warrants and Additional Warrants granted in connection with the Loan and Security Agreement, s ee Note 15 "Financing Agreements" . We revalued the 3,835 thousand warrants granted and outstanding at March 31, 2024 using the Dynamic Black-Scholes model that computes the impact of a possible change in control transaction upon the exercise of the warrant shares. The Dynamic Black-Scholes Merton unobservable inputs used were as follows: Dynamic Black-Scholes Merton Unobservable Inputs Initial Warrants Additional Warrants New Warrants Expected dividend rate — % — % — % Expected volatility 113.23 % 115.74 % 109.89 % Risk free interest rate 4.40 % 4.31 % 4.21 % Expected term 3.01 3.67 4.76 The following is an analysis of changes in the derivative liability classified as level 3 in the fair value hierarchy as of March 31, 2024 and December 31, 2023 (in thousands): Level Three Roll-Forward March 31, 2024 December 31, 2023 Balance at beginning of period $ 9,907 $ 14,270 New warrants granted — 2,905 Repricing warrants granted — 724 Change in valuation of warrants included in net income (6,658) (7,992) Balance at end of period $ 3,249 $ 9,907 See Note 20 "Commodity Derivative Instruments" , below for information on the impact on results of operations of our commodity derivative instruments. |
COMMODITY DERIVATIVE INSTRUMENT
COMMODITY DERIVATIVE INSTRUMENTS | 3 Months Ended |
Mar. 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
COMMODITY DERIVATIVE INSTRUMENTS | COMMODITY DERIVATIVE INSTRUMENTS The Company utilizes derivative instruments to manage its exposure to fluctuations in the underlying commodity prices of its inventory. The Company’s management sets and implements hedging policies, including volumes, types of instruments and counterparties, to support oil prices at targeted levels and manage its exposure to fluctuating prices. The Company’s derivative instruments consist of option and futures arrangements for oil. For option and futures arrangements, the Company receives the difference positive or negative between an agreed-upon strike price and the market price. The mark-to-market effects of these contracts as of March 31, 2024 and December 31, 2023, are summarized in the following table. The notional amount is equal to the total net volumetric derivative position during the period indicated. The fair value of the crude oil futures agreements is based on the difference between the strike price and the New York Mercantile Exchange and Brent Complex futures price for the applicable trading months. As of March 31, 2024 Contract Type Contract Period Weighted Average Strike Price (Barrels) Remaining Volume (Barrels) Fair Value (in thousands) (in thousands) Futures Mar. 2024-May. 2024 $ 110.37 38 $ (8) Futures Mar. 2024-Jun. 2024 $ 86.00 124 $ (124) Futures Mar. 2024-May. 2024 $ 46.10 273 $ (303) As of December 31, 2023 Contract Type Contract Period Weighted Average Strike Price (Barrels) Remaining Volume (Barrels) Fair Value (in thousands) (in thousands) Futures Dec. 2023 - Feb. 2024 $ 108.18 1 $ 20 Futures Dec. 2023 - Feb. 2024 $ 110.33 4 $ (156) Futures Dec. 2023 - May. 2024 $ 77.94 7 $ (63) Futures Dec. 2023 - May. 2024 $ 49.94 60 $ 632 Swap Dec. 2023 - Jan. 2024 $ 88.39 164 $ (372) Swap Dec. 2023 - Jan. 2024 $ 25.55 100 $ (50) The carrying values of the Company’s derivatives positions and their locations on the consolidated balance sheets as of March 31, 2024 and December 31, 2023 are presented in the table below (in thousands): Balance Sheet Classification Contract Type March 31, 2024 December 31, 2023 Soybean oil future $ (303) $ 632 Crude oil swaps — (422) Crude oil futures (132) (199) Derivative commodity asset(liability) $ (435) $ 11 For the three months ended March 31, 2024 and 2023, we recognized a loss of $1.3 million and a gain of $1.5 million, respectively, on commodity derivative contracts on the consolidated statements of operations as part of our cost of revenues. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES At the end of each interim period, the Company estimates the effective tax rate expected to be applicable for the full fiscal year and this rate is applied to the results for the year-to date period, and then adjusted for any discrete period items. For the three month period ended March 31, 2024, the Company calculated an annual effective tax rate of 0% on pre-tax book loss of $17.9 million and booked total tax expenses of $0. For the three month period ended March 31, 2023, the Company calculated an annual effective tax rate of 26% on pre-tax income of $4.5 million and recognized income tax expense of $1.0 million on continued operations. The Company also recognized income tax expense of $17.7 million on discontinued operations for the three months ended March 31, 2023, refer to “ Note 22. Discontinued Operations ” for more information. For the three-month period ended March 31, 2024, the variance between the Company’s effective tax rate and the U.S. statutory rate of 21% is primarily attributable to the change in valuation allowance, non-deductible expenses and income attributable to non-controlling interest. The tax expense for the three month ended March 31, 2023, was primarily related to discrete items. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 3 Months Ended |
Mar. 31, 2024 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS During the third quarter of 2021, the Company initiated and began executing a strategic plan to sell its used motors oils business (“UMO Business”). An investment banking advisory services firm was engaged and actively marketed this segment. On February 1, 2023, the Company sold all of its equity interests in Vertex OH, which owned our Heartland refinery located in Columbus, Ohio (the “ Heartland Refinery ”) for $87.2 million net cash settlement. The sale also included all property and assets owned by Vertex OH, including inventory associated with the Heartland Refinery, and all real and leased property and permits owned by Vertex OH, and all used motor oil collection and recycling assets and operations owned by Vertex OH. For the three months ended March 31, 2023 , the Company presente d the Heartland Operations as discontinued operations . The following summarized financial information has been segregated from continuing operations and reported as Discontinued Operations for the three months ended March 31, 2023 (in thousands): Three Months Ended March 31, 2023 Revenues $ 7,366 Cost of revenues (exclusive of depreciation shown separately below) 4,589 Depreciation and amortization attributable to costs of revenues 124 Gross profit 2,653 Operating expenses: Selling, general and administrative expenses (exclusive of depreciation shown separately below) 632 Depreciation and amortization expense attributable to operating expenses 21 Total operating expenses 653 Income before income tax 2,000 Income tax expense (528) Gain on sale of discontinued operations, net of $17,218 of tax 48,868 Income from discontinued operations, net of tax $ 50,340 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Related Parties From time to time, the Company consults Ruddy Gregory, PLLC., a related party law firm of which James Gregory, a former member of the Board of Directors, and the General Counsel and Secretary of the Company as of December 31, 2023, serves as a partner. During the three months ended March 31, 2024 and 2023, we paid $172 thousand and $185 thousand to such law firm for legal services rendered. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2024 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS On April 1, 2024, on the approval and recommendation of the Compensation Committee of the Board of Directors of the Company, the Board of Directors of the Company approved (1) a first amendment to the Vertex Energy, Inc. Amended and Restated 2020 Equity Incentive Plan (the “2020 Plan”), to amend the 2020 Plan to allow for the grant of Restricted Stock Units (RSUs); previously the 2020 Plan allowed for the grant of Restricted Stock Shares, but not RSUs and the First Amendment updates the 2020 Plan to allow for the grant of RSUs; and (2) an increase in the number of shares available for future issuance under the 2020 Plan by 3,740,573 shares, to 5,240,574 shares, which represents 4% of the Company’s total outstanding shares of common stock as of December 31, 2023 (93,514,346 shares), pursuant to the terms of the 2020 Plan. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) Attributable to Parent | $ (17,734) | $ 53,863 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
SUMMARY OF CRITICAL ACCOUNTIN_2
SUMMARY OF CRITICAL ACCOUNTING POLICIES AND ESTIMATES (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of financial statements conforming with generally accepted accounting principles in the United States (“GAAP”) requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and reported amounts of revenue and expenses. Actual results could differ from these estimates. Any effects on the business, financial position or results of operations from revisions to these estimates are recorded in the period in which the facts that give rise to the revision become known. |
New Accounting Pronouncements | New Accounting Pronouncements The Company has not identified any recent accounting pronouncements that are expected to have a material impact on our financial condition, results of operations or cash flows upon adoption. |
NON-CONTROLLING INTERESTS (Tabl
NON-CONTROLLING INTERESTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Noncontrolling Interest [Abstract] | |
Schedule of Net Loss Attributable to Non-Controlling Interest | The below table represents the net loss of VRMLA for the periods ended March 31, 2024 and 2023 (in thousands). Three Months Ended March 31, 2024 2023 Net loss consolidated $ (245) $ (102) Loss attributed to Non-controlling entity $ (120) $ (50) |
REVENUES (Tables)
REVENUES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of revenue | The following tables present our revenues disaggregated by geographical market and revenue source (in thousands): Three Months Ended March 31, 2024 Refining & Black Oil & Recovery Corporate and Eliminations Consolidated Primary Geographical Markets Gulf Coast $ 657,707 $ 38,641 $ (1,022) $ 695,326 Sources of Revenue Refined products: Gasolines $ 133,151 $ — $ — $ 133,151 Jet Fuels 136,137 — — 136,137 Diesel 124,701 — — 124,701 Renewable diesel 75,803 — — 75,803 Other refinery products (1) 180,967 31,724 (1,022) 211,669 Re-refined products: Pygas 3,867 — — 3,867 Metals (2) — 3,442 — 3,442 Other re-refined products (3) — 1,773 — 1,773 Services: Terminalling 3,081 — — 3,081 Oil collection services — 1,702 — 1,702 Total revenues $ 657,707 $ 38,641 $ (1,022) $ 695,326 Three Months Ended March 31, 2023 Refining & Black Oil & Recovery Corporate and Eliminations Consolidated Primary Geographical Markets Gulf Coast $ 659,328 $ 34,547 $ (2,733) $ 691,142 Sources of Revenue Refined products: Gasolines $ 147,721 $ — $ — $ 147,721 Jet Fuels 142,375 — — 142,375 Diesel 182,456 — — 182,456 Other refinery products (1) 180,490 29,423 (2,733) 207,180 Re-refined products: Pygas 3,835 — — 3,835 Metals (2) — 3,413 — 3,413 Other re-refined products (3) 518 998 — 1,516 Services: Terminalling 1,933 — — 1,933 Oil collection services — 713 — 713 Total revenues $ 659,328 $ 34,547 $ (2,733) $ 691,142 (1) Other refinery products include the sales of base oil, VGO (vacuum gas oil), cutterstock and Hydrotreated VGO and other petroleum products. (2) Metals consist of recoverable ferrous and non-ferrous recyclable metals from manufacturing and consumption. Scrap metal can be recovered from pipes, barges, boats, building supplies, surplus equipment, tanks, and other items consisting of metal composition. These materials are segregated, processed, cut-up and sent back to a steel mill for re-purposing. (3) Other re-refinery products include the sales of asphalt, condensate, recovered products, and other petroleum products. |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | Segment information for the three months ended March 31, 2024 and 2023 is as follows (in thousands): THREE MONTHS ENDED MARCH 31, 2024 Refining & Black Oil & Recovery Corporate and Eliminations Total Revenues: Refined products $ 650,759 $ 31,724 $ (1,022) $ 681,461 Re-refined products 3,867 5,215 — 9,082 Services 3,081 1,702 — 4,783 Total revenues 657,707 38,641 (1,022) 695,326 Cost of revenues (exclusive of depreciation and amortization shown separately below) 622,974 30,082 (1,022) 652,034 Depreciation and amortization attributable to costs of revenues 6,541 1,645 — 8,186 Gross profit 28,192 6,914 — 35,106 Selling, general and administrative expenses 26,147 5,397 8,238 39,782 Depreciation and amortization attributable to operating expenses 793 72 239 1,104 Income (loss) from operations 1,252 1,445 (8,477) (5,780) Other income (expenses) Other expense (685) (359) (5) (1,049) Gain on change in derivative liability — — 6,658 6,658 Interest expense (4,747) (96) (12,840) (17,683) Total other expense (5,432) (455) (6,187) (12,074) Income (loss) from continuing operations before income tax $ (4,180) $ 990 $ (14,664) $ (17,854) Capital expenditures $ 11,299 $ 3,427 $ — $ 14,726 THREE MONTHS ENDED MARCH 31, 2023 Refining & Black Oil & Recovery Corporate and Eliminations Total Revenues: Refined products $ 653,042 $ 29,423 $ (2,733) $ 679,732 Re-refined products 4,353 4,411 — 8,764 Services 1,933 713 — 2,646 Total revenues 659,328 34,547 (2,733) 691,142 Cost of revenues (exclusive of depreciation and amortization shown separately below) 589,812 30,418 (878) 619,352 Depreciation and amortization attributable to costs of revenues 3,294 1,043 — 4,337 Gross profit 66,222 3,086 (1,855) 67,453 Selling, general and administrative expenses 26,486 4,799 10,657 41,942 Depreciation and amortization attributable to operating expenses 808 38 170 1,016 Income (loss) from operations 38,928 (1,751) (12,682) 24,495 Other income (expenses) Other income (expense) — 1,655 (2) 1,653 Loss on change in derivative liability — — (9,185) (9,185) Interest expense (3,876) (57) (8,544) (12,477) Total other income (expense) (3,876) 1,598 (17,731) (20,009) Income (loss) from continuing operations before income tax $ 35,052 $ (153) $ (30,413) $ 4,486 Capital expenditures $ 69,908 $ 4,028 $ — $ 73,936 Total assets by segment were as follows (in thousands): As of March 31, 2024 Refining & Black Oil & Recovery Corporate and Eliminations Consolidated Total assets $ 655,271 $ 110,131 $ 69,651 $ 835,053 As of December 31, 2023 Refining & Black Oil & Recovery Corporate and Eliminations Consolidated Total assets $ 661,101 $ 106,524 $ 86,999 $ 854,624 |
ACCOUNTS RECEIVABLE (Tables)
ACCOUNTS RECEIVABLE (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable | Accounts receivable, net, consists of the following at March 31, 2024 and December 31, 2023 (in thousands): March 31, 2024 December 31, 2023 Accounts receivable trade $ 42,886 $ 37,473 Allowance for credit losses (1,327) (1,309) Accounts receivable, net $ 41,559 $ 36,164 |
CONCENTRATIONS OF RISK AND SI_2
CONCENTRATIONS OF RISK AND SIGNIFICANT CUSTOMERS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Concentrations | At March 31, 2024 and 2023 and for each of the three months then ended, the Company’s revenues and receivables were comprised of the following customer concentrations: As of and for the Three Months Ended March 31, 2024 March 31, 2023 % of % of % of % of Customer 1 35% 2% 38% 23% Customer 2 30% 4% 37% 1% Customer 3 10% 22% —% —% For each of the three months ended March 31, 2024 and 2023, the Company’s segment revenues were comprised of the following customer concentrations: % of Revenue by Segment % Revenue by Segment March 31, 2024 March 31, 2023 Refining Black Oil and Recovery Refining Black Oil and Recovery Customer 1 37% —% 39% —% Customer 2 31% —% 39% —% Customer 3 11% —% —% —% |
INVENTORY (Tables)
INVENTORY (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | The following table describes the Company's inventory balances by category (in thousands): As of March 31, 2024 As of December 31, 2023 Crude oil $ 72,966 $ 60,702 Renewable feedstocks 24,920 27,450 Refined products 98,699 91,911 Re-refined products 2,394 2,057 Total hydrocarbon inventories $ 198,979 $ 182,120 The following table summarizes our outstanding obligations under our inventory financing agreements (in thousands): March 31, 2024 December 31, 2023 Obligations under inventory financing agreements $ 169,656 $ 141,343 Unamortized financing cost — (250) Obligations under inventory financing agreements, net $ 169,656 $ 141,093 |
INVENTORY FINANCING AGREEMENTS
INVENTORY FINANCING AGREEMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | The following table describes the Company's inventory balances by category (in thousands): As of March 31, 2024 As of December 31, 2023 Crude oil $ 72,966 $ 60,702 Renewable feedstocks 24,920 27,450 Refined products 98,699 91,911 Re-refined products 2,394 2,057 Total hydrocarbon inventories $ 198,979 $ 182,120 The following table summarizes our outstanding obligations under our inventory financing agreements (in thousands): March 31, 2024 December 31, 2023 Obligations under inventory financing agreements $ 169,656 $ 141,343 Unamortized financing cost — (250) Obligations under inventory financing agreements, net $ 169,656 $ 141,093 |
Schedule of Inventory Cost | The following table summarizes the inventory intermediation fees, interest expenses and financing costs (in thousands): Three Months Ended March 31, 2024 2023 Intermediation fees (include over/under) $ (41) $ 2,064 Inventory financing fees $ 2,063 $ 2,295 Interest expense and financing costs, net $ 2,959 $ 2,520 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule Of Prepaid Expenses And Other Current Assets | The following table describes the Company's prepaid expenses and other current assets balances (in thousands): As of March 31, 2024 As of December 31, 2023 Prepaid insurance $ 1,950 $ 8,076 Commodity derivative advance 1,724 1,502 Sulfur credits 603 3,462 Prepaid feedstock 1,831 9,845 Prepaid freight 3,243 3,260 Prepaid operating expenses 3,429 4,756 Inventory financing deposit 18,618 15,259 Derivative commodity assets — 11 Other current assets 7,275 7,003 Total prepaid expenses & other current assets $ 38,673 $ 53,174 |
FIXED ASSETS, NET (Tables)
FIXED ASSETS, NET (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Fixed Assets | Fixed assets consist of the following (in thousands): Useful Life March 31, 2024 December 31, 2023 Equipment 7 - 20 $ 287,067 $ 276,331 Leasehold improvements 15 2,877 2,852 Office equipment & furniture 5 - 7 1,446 1,446 Vehicles 5 15,796 15,087 Building 20 3,912 3,663 Turnarounds 4 19,388 21,100 Construction in progress 55,043 53,467 Land 9,120 9,439 Land improvement 15 972 354 Total fixed assets 395,621 383,739 Less accumulated depreciation (62,672) (57,628) Net fixed assets $ 332,949 $ 326,111 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | Components of intangible assets (subject to amortization) consist of the following items (in thousands): March 31, 2024 December 31, 2023 Useful Life (in years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relations 5 $ 1,658 $ 1,023 $ 635 $ 1,658 $ 989 $ 669 Vendor relations 10 4,778 4,657 121 4,778 4,639 139 Trademark/Trade name 15 887 669 218 887 657 230 Technology/Patent 15 - 30 15,787 10,021 5,766 15,787 9,780 6,007 Software and cloud 3 10,419 6,370 4,049 10,067 5,571 4,496 $ 33,529 $ 22,740 $ 10,789 $ 33,177 $ 21,636 $ 11,541 |
Schedule of Estimated Future Amortization Expense | Estimated future amortization expense is as follows (in thousands): March 31, Balance 2025 $ 4,458 2026 1,412 2027 1,383 2028 1,006 2029 510 Thereafter 2,020 $ 10,789 |
ACCRUED LIABILITIES (Tables)
ACCRUED LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued expenses and other current liabilities consisted of the following (in thousands): March 31, 2024 December 31, 2023 Accrued purchases $ 10,020 17,685 Accrued interest 321 460 Accrued compensation and benefits 6,206 7,605 Accrued taxes other than payroll taxes 2,223 826 RINS obligations 44,395 46,153 Benzene credits obligations 311 531 Unearned revenue 5,278 325 Environmental liabilities - current 51 51 Derivative commodity liability 435 — $ 69,240 $ 73,636 |
FINANCING ARRANGEMENTS (Tables)
FINANCING ARRANGEMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of Outstanding Debt Facilities | The Company's long-term debt consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands): Creditor Loan Type Balance at March 31, 2024 Balance at December 31, 2023 Senior Convertible Note Convertible note $ 15,230 $ 15,230 Term Loan 2025 Loan 195,950 195,950 Citizens National Bank - Promissory Note Loan 2,611 — Various institutions Short-term note 2,399 6,237 Principal amount of long-term debt 216,190 217,417 Less: unamortized discount and deferred financing costs (25,894) (30,354) Total debt, net of unamortized discount and deferred financing costs 190,296 187,063 Less: current maturities, net of unamortized discount and deferred financing costs (12,524) (16,362) Long-term debt, net of current maturities $ 177,772 $ 170,701 |
Schedule of Future Maturities of Notes Payable | Future maturities of long-term debt, excluding financing lease obligations, as of March 31, 2024 are summarized as follows (in thousands): Period Ended March 31, Amount Due 2025 $ 12,524 2026 185,825 2027 — 2028 15,230 2029 2,611 Total $ 216,190 |
Schedule of Debt | The components of the Convertible Senior Notes are presented as follows (in thousands) : March 31, 2024 December 31, 2023 Principal amounts at beginning of period $ 15,230 $ 95,178 Conversion of principal into common stock — (79,948) Outstanding principal amount 15,230 15,230 Unamortized discount and issuance costs (6,865) (7,157) Net carrying amount at end of period $ 8,365 $ 8,073 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
Schedule of Lease Cost | The Company's finance lease liabilities consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands): Creditor Loan Type March 31, 2024 December 31, 2023 Matheson Tri-Gas Finance Lease $ 43,816 $ 44,132 Plaquemines Finance Lease 940 994 Harvey Ford Finance Lease 36 39 DLL financial Finance Lease 45 47 Diego Finance Lease 139 137 Xerox Finance Lease 16 — Centerpoint Blakely Finance Lease 23,081 23,292 $ 68,073 $ 68,641 The following table summarizes the lease cost recognized in our consolidated statements of operations (in thousands): Three Months Ended March 31, Lease Cost Type 2024 2023 Amortization of finance lease ROU assets $ 993 $ 784 Interest on lease liabilities 1,522 1,382 Net finance lease costs $ 2,515 $ 2,166 The following table summarizes the operating lease costs recognized (in thousands): Three Months Ended March 31, Lease Cost Type 2024 2023 Operating lease cost $ 7,499 $ 3,070 Variable lease cost 659 260 Short-term lease cost 6,651 1,929 Net lease cost $ 14,809 $ 5,259 The following table summarizes the supplemental cash flow information related to leases as follows (in thousands): Three Months Ended March 31, Lease Cost Type 2024 2023 Cash paid for amounts included in the measurement of liabilities Payments on financing lease $ 586 $ 310 Payments on operating lease $ 7,499 $ 3,070 Non-cash supplemental amounts ROU assets obtained from new finance lease liabilities $ 18 $ 15,024 ROU assets obtained from new operating lease liabilities $ 74 $ 15,078 ROU assets terminated from release of operating lease liabilities $ (17,666) $ — The weighted average remaining lease terms and discount rates for all of our financing lease and operating leases were as follows as of March 31, 2024: Remaining lease term and discount rate: March 31, 2024 Operating lease Financing lease Weighted average remaining lease terms (years) Lease facilities 4.94 — Lease equipment 1.90 3.87 Lease plant 13.55 14.16 Lease railcar 2.21 — Weighted average discount rate Lease facilities 11.07 % — % Lease equipment 12.11 % 9.19 % Lease plant 12.31 % 8.89 % Lease railcar 10.72 % — % |
Schedule of Finance Lease, Liability, Fiscal Year Maturity | Future maturities of finance lease obligations, as of March 31, 2024, are summarized as follows (in thousands): Period Ended March 31, Amount Due 2025 $ 8,459 2026 8,462 2027 8,455 2028 27,847 2029 6,588 Thereafter 56,240 Total lease payments 116,051 Less: interest (47,978) Present value of financing lease liabilities 68,073 Less: current portion of lease liabilities (2,497) Total lease liabilities, net of current portion $ 65,576 |
Schedule of Maturities of Operating Lease Liabilities | Maturities of our lease liabilities for all operating leases are as follows as of March 31, 2024 (in thousands): For the period ending March 31, Facilities Equipment Plant Railcar Total 2025 $ 975 $ 12,300 $ 8,009 $ 687 $ 21,971 2026 818 6,512 7,721 567 15,618 2027 631 5,058 7,745 246 13,680 2028 606 3,438 7,603 104 11,751 2029 545 — 6,946 — 7,491 Thereafter 1,293 — 72,072 — 73,365 Total lease payments 4,868 27,308 110,096 1,604 143,876 Less: interest (1,391) (4,269) (60,455) (135) (66,250) Present value of operating lease liabilities 3,477 23,039 49,641 1,469 77,626 Less: current portion of lease liabilities (621) (10,076) (2,025) (559) (13,281) Total lease liabilities, net of current portion $ 2,856 $ 12,963 $ 47,616 $ 910 $ 64,345 |
EARNINGS_PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Basic and Diluted Income (Loss) Per Share | The following is a reconciliation of the numerator and denominator for basic and diluted income (loss) per share for the three months ended March 31, 2024 and 2023 (in thousands, except per share amounts): Three Months Ended March 31, 2024 2023 Basic income (loss) per Share Numerator: Net income (loss) attributable to shareholders from continuing operations $ (17,734) $ 3,523 Net income attributable to shareholders from discontinued operations, net of tax — 50,340 Net income (loss) attributable to common shareholders $ (17,734) $ 53,863 Denominator: Weighted-average common shares outstanding 93,514 75,689 Basic income (loss) per common shares Continuing operations $ (0.19) $ 0.05 Discontinued operations, net of tax — 0.66 Basic income (loss) per share $ (0.19) $ 0.71 Diluted Income (Loss) per Share Numerator: Net income (loss) attributable to shareholders from continuing operations $ (17,734) $ 3,523 Net income available to shareholders from discontinued operations, net of tax — 50,340 Net income (loss) available to common shareholders $ (17,734) $ 53,863 Denominator: Weighted-average shares outstanding 93,514 75,689 Effect of dilutive securities* Stock options and warrants — 3,307 Diluted weighted-average shares outstanding 93,514 78,996 Diluted income (loss) per common shares Continuing operations $ (0.19) $ 0.04 Discontinued operations, net of tax — 0.64 Diluted income (loss) per share $ (0.19) $ 0.68 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, by Balance Sheet Grouping | The following tables present assets and liabilities accounted for at fair value on a recurring basis as of March 31, 2024 and December 31, 2023 (in thousands): As of March 31, 2024 Level 1 Level 2 Level 3 Total Assets at fair value Environmental credits $ — $ 603 $ — $ 603 Total assets at fair value — 603 — 603 Liabilities at fair value Commodity — (435) — (435) RINS and environmental credits — (44,706) — (44,706) Derivative warrants — — (3,249) (3,249) Total liabilities at fair value — (45,141) (3,249) (48,390) Total $ — $ (44,538) $ (3,249) $ (47,787) As of December 31, 2023 Level 1 Level 2 Level 3 Total Assets at fair value Commodity $ — $ 11 $ — $ 11 Total assets at fair value — 11 — 11 Liabilities at fair value RINS and environmental credits — (46,684) — (46,684) Derivative warrants — — (9,907) (9,907) Total liabilities at fair value — (46,684) (9,907) (56,591) Total $ — $ (46,673) $ (9,907) $ (56,580) |
Schedule of Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The Dynamic Black-Scholes Merton unobservable inputs used were as follows: Dynamic Black-Scholes Merton Unobservable Inputs Initial Warrants Additional Warrants New Warrants Expected dividend rate — % — % — % Expected volatility 113.23 % 115.74 % 109.89 % Risk free interest rate 4.40 % 4.31 % 4.21 % Expected term 3.01 3.67 4.76 The following is an analysis of changes in the derivative liability classified as level 3 in the fair value hierarchy as of March 31, 2024 and December 31, 2023 (in thousands): Level Three Roll-Forward March 31, 2024 December 31, 2023 Balance at beginning of period $ 9,907 $ 14,270 New warrants granted — 2,905 Repricing warrants granted — 724 Change in valuation of warrants included in net income (6,658) (7,992) Balance at end of period $ 3,249 $ 9,907 |
COMMODITY DERIVATIVE INSTRUME_2
COMMODITY DERIVATIVE INSTRUMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments | The fair value of the crude oil futures agreements is based on the difference between the strike price and the New York Mercantile Exchange and Brent Complex futures price for the applicable trading months. As of March 31, 2024 Contract Type Contract Period Weighted Average Strike Price (Barrels) Remaining Volume (Barrels) Fair Value (in thousands) (in thousands) Futures Mar. 2024-May. 2024 $ 110.37 38 $ (8) Futures Mar. 2024-Jun. 2024 $ 86.00 124 $ (124) Futures Mar. 2024-May. 2024 $ 46.10 273 $ (303) As of December 31, 2023 Contract Type Contract Period Weighted Average Strike Price (Barrels) Remaining Volume (Barrels) Fair Value (in thousands) (in thousands) Futures Dec. 2023 - Feb. 2024 $ 108.18 1 $ 20 Futures Dec. 2023 - Feb. 2024 $ 110.33 4 $ (156) Futures Dec. 2023 - May. 2024 $ 77.94 7 $ (63) Futures Dec. 2023 - May. 2024 $ 49.94 60 $ 632 Swap Dec. 2023 - Jan. 2024 $ 88.39 164 $ (372) Swap Dec. 2023 - Jan. 2024 $ 25.55 100 $ (50) |
Schedule of Fair Value of Derivative Instruments within Balance Sheet | The carrying values of the Company’s derivatives positions and their locations on the consolidated balance sheets as of March 31, 2024 and December 31, 2023 are presented in the table below (in thousands): Balance Sheet Classification Contract Type March 31, 2024 December 31, 2023 Soybean oil future $ (303) $ 632 Crude oil swaps — (422) Crude oil futures (132) (199) Derivative commodity asset(liability) $ (435) $ 11 |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Disposal Groups Including Discontinued Operations Income Statement and Balance Sheet | The following summarized financial information has been segregated from continuing operations and reported as Discontinued Operations for the three months ended March 31, 2023 (in thousands): Three Months Ended March 31, 2023 Revenues $ 7,366 Cost of revenues (exclusive of depreciation shown separately below) 4,589 Depreciation and amortization attributable to costs of revenues 124 Gross profit 2,653 Operating expenses: Selling, general and administrative expenses (exclusive of depreciation shown separately below) 632 Depreciation and amortization expense attributable to operating expenses 21 Total operating expenses 653 Income before income tax 2,000 Income tax expense (528) Gain on sale of discontinued operations, net of $17,218 of tax 48,868 Income from discontinued operations, net of tax $ 50,340 |
BASIS OF PRESENTATION AND NAT_2
BASIS OF PRESENTATION AND NATURE OF OPERATIONS (Details) - Mobile Refinery - ALABAMA bbl in Millions | Apr. 01, 2022 gallonPerMinute bbl / d bbl |
Product Information | |
Annual production capacity (bbl/day) | bbl / d | 75,000 |
Inventory acquired (barrels/gallons) | bbl | 3.2 |
Mobile truck rack | gallonPerMinute | 600 |
SUMMARY OF CRITICAL ACCOUNTIN_3
SUMMARY OF CRITICAL ACCOUNTING POLICIES AND ESTIMATES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
New Accounting Pronouncements or Change in Accounting Principle | |||
Cash and cash equivalents | $ 62,140 | $ 86,689 | $ 76,967 |
Loss from continuing operations | (17,900) | ||
Cash outflows from operating activities from continuing operations | 29,126 | $ 36,651 | |
Restricted cash and cash equivalents | 1,500 | 1,500 | |
Short Term Equipment Lease Deposit | |||
New Accounting Pronouncements or Change in Accounting Principle | |||
Restricted cash and cash equivalents | 2,000 | 2,000 | |
Money Market Funds | |||
New Accounting Pronouncements or Change in Accounting Principle | |||
Restricted cash and cash equivalents | $ 100 | $ 100 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 1 Months Ended | |||||||
Mar. 07, 2024 USD ($) | Jul. 19, 2023 defendant | Apr. 13, 2023 defendant plaintiff | Jun. 30, 2023 quarter | Mar. 31, 2024 USD ($) | Feb. 26, 2024 quarter | Dec. 31, 2023 USD ($) | Feb. 16, 2023 lawsuit | |
Penthol Litigation | Judicial Ruling | ||||||||
Site Contingency [Line Items] | ||||||||
Judge's ruling on unpaid commission | $ | $ 1.4 | |||||||
Percent interest awarded on unpaid claim | 5% | |||||||
Doucet Litigation | ||||||||
Site Contingency [Line Items] | ||||||||
Number of pending claims | lawsuit | 5 | |||||||
Willam C. Passmore Punitive Class Action Litigation | ||||||||
Site Contingency [Line Items] | ||||||||
Number of defendants | defendant | 3 | |||||||
Number of plantiff | plaintiff | 3 | |||||||
Shareholder Derivative Lawsuits | ||||||||
Site Contingency [Line Items] | ||||||||
Number of pending claims | quarter | 5 | |||||||
Number of defendants | defendant | 2 | |||||||
Number of plantiff | quarter | 2 | |||||||
Environmental Remediation | Environmental Remediation | ||||||||
Site Contingency [Line Items] | ||||||||
Accrual for environmental loss contingencies | $ | $ 1.4 | $ 1.4 |
NON-CONTROLLING INTERESTS - Nar
NON-CONTROLLING INTERESTS - Narrative (Details) | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | May 25, 2016 | |
Industrial Pipe, Inc. | Vertex Recovery Management LA, LLC | |||
Redeemable Noncontrolling Interest [Line Items] | |||
Ownership interest in VRMLA by Industrial Pipe, Inc. (in percent) | 49% | ||
Leverage Lubricants LLC | |||
Redeemable Noncontrolling Interest [Line Items] | |||
Income from VRMLA included in consolidated income (percent) | 100% | 100% | |
Vertex Recovery Management, LLC | Subsidiaries | |||
Redeemable Noncontrolling Interest [Line Items] | |||
Ownership percentage (as a percent) | 51% |
NON-CONTROLLING INTERESTS - Net
NON-CONTROLLING INTERESTS - Net Loss Attributable to Non-Controlling Interest (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Industrial Pipe, Inc. | ||
Redeemable Noncontrolling Interest [Line Items] | ||
Loss attributed to Non-controlling entity | $ (120,000) | $ (50,000) |
Subsidiaries | Vertex Recovery Management LA, LLC | ||
Redeemable Noncontrolling Interest [Line Items] | ||
Net loss consolidated | $ (245,000) | $ (102,000) |
REVENUES (Details)
REVENUES (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue | ||
Total revenues | $ 695,326 | $ 691,142 |
Gasolines | ||
Disaggregation of Revenue | ||
Total revenues | 133,151 | 147,721 |
Jet Fuels | ||
Disaggregation of Revenue | ||
Total revenues | 136,137 | 142,375 |
Diesel | ||
Disaggregation of Revenue | ||
Total revenues | 124,701 | 182,456 |
Renewable diesel | ||
Disaggregation of Revenue | ||
Total revenues | 75,803 | |
Other refinery products | ||
Disaggregation of Revenue | ||
Total revenues | 211,669 | 207,180 |
Pygas | ||
Disaggregation of Revenue | ||
Total revenues | 3,867 | 3,835 |
Metals | ||
Disaggregation of Revenue | ||
Total revenues | 3,442 | 3,413 |
Other re-refined products | ||
Disaggregation of Revenue | ||
Total revenues | 1,773 | 1,516 |
Terminalling | ||
Disaggregation of Revenue | ||
Total revenues | 3,081 | 1,933 |
Oil collection services | ||
Disaggregation of Revenue | ||
Total revenues | 1,702 | 713 |
Corporate and Eliminations | ||
Disaggregation of Revenue | ||
Total revenues | (1,022) | (2,733) |
Corporate and Eliminations | Gasolines | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Corporate and Eliminations | Jet Fuels | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Corporate and Eliminations | Diesel | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Corporate and Eliminations | Renewable diesel | ||
Disaggregation of Revenue | ||
Total revenues | 0 | |
Corporate and Eliminations | Other refinery products | ||
Disaggregation of Revenue | ||
Total revenues | (1,022) | (2,733) |
Corporate and Eliminations | Pygas | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Corporate and Eliminations | Metals | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Corporate and Eliminations | Other re-refined products | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Corporate and Eliminations | Terminalling | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Corporate and Eliminations | Oil collection services | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Refining & Marketing | Operating Segments | ||
Disaggregation of Revenue | ||
Total revenues | 657,707 | 659,328 |
Refining & Marketing | Operating Segments | Gasolines | ||
Disaggregation of Revenue | ||
Total revenues | 133,151 | 147,721 |
Refining & Marketing | Operating Segments | Jet Fuels | ||
Disaggregation of Revenue | ||
Total revenues | 136,137 | 142,375 |
Refining & Marketing | Operating Segments | Diesel | ||
Disaggregation of Revenue | ||
Total revenues | 124,701 | 182,456 |
Refining & Marketing | Operating Segments | Renewable diesel | ||
Disaggregation of Revenue | ||
Total revenues | 75,803 | |
Refining & Marketing | Operating Segments | Other refinery products | ||
Disaggregation of Revenue | ||
Total revenues | 180,967 | 180,490 |
Refining & Marketing | Operating Segments | Pygas | ||
Disaggregation of Revenue | ||
Total revenues | 3,867 | 3,835 |
Refining & Marketing | Operating Segments | Metals | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Refining & Marketing | Operating Segments | Other re-refined products | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 518 |
Refining & Marketing | Operating Segments | Terminalling | ||
Disaggregation of Revenue | ||
Total revenues | 3,081 | 1,933 |
Refining & Marketing | Operating Segments | Oil collection services | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Black Oil & Recovery | Operating Segments | ||
Disaggregation of Revenue | ||
Total revenues | 38,641 | 34,547 |
Black Oil & Recovery | Operating Segments | Gasolines | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Black Oil & Recovery | Operating Segments | Jet Fuels | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Black Oil & Recovery | Operating Segments | Diesel | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Black Oil & Recovery | Operating Segments | Renewable diesel | ||
Disaggregation of Revenue | ||
Total revenues | 0 | |
Black Oil & Recovery | Operating Segments | Other refinery products | ||
Disaggregation of Revenue | ||
Total revenues | 31,724 | 29,423 |
Black Oil & Recovery | Operating Segments | Pygas | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Black Oil & Recovery | Operating Segments | Metals | ||
Disaggregation of Revenue | ||
Total revenues | 3,442 | 3,413 |
Black Oil & Recovery | Operating Segments | Other re-refined products | ||
Disaggregation of Revenue | ||
Total revenues | 1,773 | 998 |
Black Oil & Recovery | Operating Segments | Terminalling | ||
Disaggregation of Revenue | ||
Total revenues | 0 | 0 |
Black Oil & Recovery | Operating Segments | Oil collection services | ||
Disaggregation of Revenue | ||
Total revenues | $ 1,702 | $ 713 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Segment Reporting Information | |||
Revenues | $ 695,326 | $ 691,142 | |
Cost of revenues (exclusive of depreciation and amortization shown separately below) | 652,034 | 619,352 | |
Depreciation and amortization attributable to costs of revenues | 8,186 | 4,337 | |
Gross profit | 35,106 | 67,453 | |
Selling, general and administrative expenses | 39,782 | 41,942 | |
Depreciation and amortization attributable to operating expenses | 1,104 | 1,016 | |
Income (loss) from operations | (5,780) | 24,495 | |
Other expense | (1,049) | 1,653 | |
Gain on change in derivative liability | 6,658 | (9,185) | |
Interest expense | (17,683) | (12,477) | |
Total other expense | (12,074) | (20,009) | |
Income (loss) from continuing operations before income tax | (17,854) | 4,486 | |
Total capital expenditures | 14,726 | 73,936 | |
Total assets | 835,053 | 854,624 | $ 854,624 |
Corporate and Eliminations | |||
Segment Reporting Information | |||
Revenues | (1,022) | (2,733) | |
Cost of revenues (exclusive of depreciation and amortization shown separately below) | (1,022) | (878) | |
Depreciation and amortization attributable to costs of revenues | 0 | 0 | |
Gross profit | 0 | (1,855) | |
Selling, general and administrative expenses | 8,238 | 10,657 | |
Depreciation and amortization attributable to operating expenses | 239 | 170 | |
Income (loss) from operations | (8,477) | (12,682) | |
Other expense | (5) | (2) | |
Gain on change in derivative liability | 6,658 | (9,185) | |
Interest expense | (12,840) | (8,544) | |
Total other expense | (6,187) | (17,731) | |
Income (loss) from continuing operations before income tax | (14,664) | (30,413) | |
Total capital expenditures | 0 | 0 | |
Total assets | 69,651 | 86,999 | |
Refining and Marketing | Operating Segments | |||
Segment Reporting Information | |||
Revenues | 657,707 | 659,328 | |
Cost of revenues (exclusive of depreciation and amortization shown separately below) | 622,974 | 589,812 | |
Depreciation and amortization attributable to costs of revenues | 6,541 | 3,294 | |
Gross profit | 28,192 | 66,222 | |
Selling, general and administrative expenses | 26,147 | 26,486 | |
Depreciation and amortization attributable to operating expenses | 793 | 808 | |
Income (loss) from operations | 1,252 | 38,928 | |
Other expense | (685) | 0 | |
Gain on change in derivative liability | 0 | 0 | |
Interest expense | (4,747) | (3,876) | |
Total other expense | (5,432) | (3,876) | |
Income (loss) from continuing operations before income tax | (4,180) | 35,052 | |
Total capital expenditures | 11,299 | 69,908 | |
Total assets | 655,271 | 661,101 | |
Black Oil and Recovery | Operating Segments | |||
Segment Reporting Information | |||
Revenues | 38,641 | 34,547 | |
Cost of revenues (exclusive of depreciation and amortization shown separately below) | 30,082 | 30,418 | |
Depreciation and amortization attributable to costs of revenues | 1,645 | 1,043 | |
Gross profit | 6,914 | 3,086 | |
Selling, general and administrative expenses | 5,397 | 4,799 | |
Depreciation and amortization attributable to operating expenses | 72 | 38 | |
Income (loss) from operations | 1,445 | (1,751) | |
Other expense | (359) | 1,655 | |
Gain on change in derivative liability | 0 | 0 | |
Interest expense | (96) | (57) | |
Total other expense | (455) | 1,598 | |
Income (loss) from continuing operations before income tax | 990 | (153) | |
Total capital expenditures | 3,427 | 4,028 | |
Total assets | 110,131 | 106,524 | |
Refined products | |||
Segment Reporting Information | |||
Revenues | 681,461 | 679,732 | |
Refined products | Corporate and Eliminations | |||
Segment Reporting Information | |||
Revenues | (1,022) | (2,733) | |
Refined products | Refining and Marketing | Operating Segments | |||
Segment Reporting Information | |||
Revenues | 650,759 | 653,042 | |
Refined products | Black Oil and Recovery | Operating Segments | |||
Segment Reporting Information | |||
Revenues | 31,724 | 29,423 | |
Re-refined products | |||
Segment Reporting Information | |||
Revenues | 9,082 | 8,764 | |
Re-refined products | Corporate and Eliminations | |||
Segment Reporting Information | |||
Revenues | 0 | 0 | |
Re-refined products | Refining and Marketing | Operating Segments | |||
Segment Reporting Information | |||
Revenues | 3,867 | 4,353 | |
Re-refined products | Black Oil and Recovery | Operating Segments | |||
Segment Reporting Information | |||
Revenues | 5,215 | 4,411 | |
Services | |||
Segment Reporting Information | |||
Revenues | 4,783 | 2,646 | |
Services | Corporate and Eliminations | |||
Segment Reporting Information | |||
Revenues | 0 | 0 | |
Services | Refining and Marketing | Operating Segments | |||
Segment Reporting Information | |||
Revenues | 3,081 | 1,933 | |
Services | Black Oil and Recovery | Operating Segments | |||
Segment Reporting Information | |||
Revenues | $ 1,702 | $ 713 |
ACCOUNTS RECEIVABLE (Details)
ACCOUNTS RECEIVABLE (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Accounts Receivable, after Allowance for Credit Loss, Current [Abstract] | |||
Accounts receivable trade | $ 42,886,000 | $ 37,473,000 | |
Allowance for credit losses | (1,327,000) | (1,309,000) | |
Receivables, Net, Current | 41,559,000 | $ 36,164,000 | |
Bad debt expense | $ 19,000 | $ 881,700 |
CONCENTRATIONS OF RISK AND SI_3
CONCENTRATIONS OF RISK AND SIGNIFICANT CUSTOMERS (Details) - bank | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Revenue, Major Customer | ||
Concentration risk, deposit maintained in number of banks | 1 | |
Customer 1 | Revenues | Customer concentration risk | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 35% | 38% |
Customer 1 | Revenues | Customer concentration risk | Refining | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 37% | 39% |
Customer 1 | Revenues | Customer concentration risk | Black Oil and Recovery | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 0% | 0% |
Customer 1 | Receivables | Customer concentration risk | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 2% | 23% |
Customer 2 | Revenues | Customer concentration risk | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 30% | 37% |
Customer 2 | Revenues | Customer concentration risk | Refining | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 31% | 39% |
Customer 2 | Revenues | Customer concentration risk | Black Oil and Recovery | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 0% | 0% |
Customer 2 | Receivables | Customer concentration risk | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 4% | 1% |
Customer 3 | Revenues | Customer concentration risk | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 10% | 0% |
Customer 3 | Revenues | Customer concentration risk | Refining | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 11% | 0% |
Customer 3 | Revenues | Customer concentration risk | Black Oil and Recovery | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 0% | 0% |
Customer 3 | Receivables | Customer concentration risk | ||
Revenue, Major Customer | ||
Concentration percentage (as a percent) | 22% | 0% |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Inventory [Line Items] | ||
Inventory | $ 198,979 | $ 182,120 |
Crude oil | ||
Inventory [Line Items] | ||
Inventory | 72,966 | 60,702 |
Renewable feedstocks | ||
Inventory [Line Items] | ||
Inventory | 24,920 | 27,450 |
Refined products | ||
Inventory [Line Items] | ||
Inventory | 98,699 | 91,911 |
Re-refined products | ||
Inventory [Line Items] | ||
Inventory | $ 2,394 | $ 2,057 |
INVENTORY FINANCING AGREEMENT_2
INVENTORY FINANCING AGREEMENTS - Schedule of Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Inventory [Line Items] | ||
Obligations under inventory financing agreements, net | $ 169,656 | $ 141,093 |
Inventory Financing Agreement | Macquarie | ||
Inventory [Line Items] | ||
Obligations under inventory financing agreements | 169,656 | 141,343 |
Unamortized financing cost | 0 | (250) |
Obligations under inventory financing agreements, net | $ 169,656 | $ 141,093 |
INVENTORY FINANCING AGREEMENT_3
INVENTORY FINANCING AGREEMENTS - Narrative (Details) - Macquarie | 3 Months Ended | |
May 26, 2023 | Mar. 31, 2024 | |
Inventory [Line Items] | ||
Supply and offtake agreement, automatic renewal term | 12 months | |
Termination period after notice | 180 days | |
Vertex Renewables Alabama LLC | ||
Inventory [Line Items] | ||
Termination period after notice | 180 days | |
Supply and offtake agreement, term | 24 months |
INVENTORY FINANCING AGREEMENT_4
INVENTORY FINANCING AGREEMENTS - Schedule of Inventory Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | ||
Intermediation fees (include over/under) | $ (41) | $ 2,064 |
Inventory financing fees | 2,063 | 2,295 |
Interest expense and financing costs, net | $ 2,959 | $ 2,520 |
PREPAID EXPENSES AND OTHER CU_3
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid insurance | $ 1,950 | $ 8,076 |
Commodity derivative advance | 1,724 | 1,502 |
Sulfur credits | 603 | 3,462 |
Prepaid feedstock | 1,831 | 9,845 |
Prepaid freight | 3,243 | 3,260 |
Prepaid operating expenses | 3,429 | 4,756 |
Inventory financing deposit | 18,618 | 15,259 |
Derivative commodity assets | 0 | 11 |
Other current assets | 7,275 | 7,003 |
Prepaid expenses and other current assets | $ 38,673 | $ 53,174 |
FIXED ASSETS, NET - Schedule of
FIXED ASSETS, NET - Schedule of Fixed Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Property, Plant and Equipment, Net | ||
Total fixed assets | $ 395,621 | $ 383,739 |
Less accumulated depreciation | (62,672) | (57,628) |
Net fixed assets | 332,949 | 326,111 |
Equipment | ||
Property, Plant and Equipment, Net | ||
Total fixed assets | $ 287,067 | 276,331 |
Leasehold improvements | ||
Property, Plant and Equipment, Net | ||
Useful Life (in years) | 15 years | |
Total fixed assets | $ 2,877 | 2,852 |
Office equipment & furniture | ||
Property, Plant and Equipment, Net | ||
Total fixed assets | $ 1,446 | 1,446 |
Vehicles | ||
Property, Plant and Equipment, Net | ||
Useful Life (in years) | 5 years | |
Total fixed assets | $ 15,796 | 15,087 |
Building | ||
Property, Plant and Equipment, Net | ||
Useful Life (in years) | 20 years | |
Total fixed assets | $ 3,912 | 3,663 |
Turnarounds | ||
Property, Plant and Equipment, Net | ||
Useful Life (in years) | 4 years | |
Total fixed assets | $ 19,388 | 21,100 |
Construction in progress | ||
Property, Plant and Equipment, Net | ||
Total fixed assets | 55,043 | 53,467 |
Land | ||
Property, Plant and Equipment, Net | ||
Total fixed assets | $ 9,120 | 9,439 |
Land improvement | ||
Property, Plant and Equipment, Net | ||
Useful Life (in years) | 15 years | |
Total fixed assets | $ 972 | $ 354 |
Minimum | Equipment | ||
Property, Plant and Equipment, Net | ||
Useful Life (in years) | 7 years | |
Minimum | Office equipment & furniture | ||
Property, Plant and Equipment, Net | ||
Useful Life (in years) | 5 years | |
Maximum | Equipment | ||
Property, Plant and Equipment, Net | ||
Useful Life (in years) | 20 years | |
Maximum | Office equipment & furniture | ||
Property, Plant and Equipment, Net | ||
Useful Life (in years) | 7 years |
FIXED ASSETS, NET - Narrative (
FIXED ASSETS, NET - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 7.2 | $ 3.6 |
Gain on the sale of land | $ 2.6 |
INTANGIBLE ASSETS, NET -Schedul
INTANGIBLE ASSETS, NET -Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Net Carrying Amount | ||
Gross Carrying Amount | $ 33,529 | $ 33,177 |
Accumulated Amortization | 22,740 | 21,636 |
Net Carrying Amount | 10,789 | |
Net Carrying Amount | $ 10,789 | 11,541 |
Customer relations | ||
Net Carrying Amount | ||
Useful Life (in years) | 5 years | |
Gross Carrying Amount | $ 1,658 | 1,658 |
Accumulated Amortization | 1,023 | 989 |
Net Carrying Amount | $ 635 | 669 |
Vendor relations | ||
Net Carrying Amount | ||
Useful Life (in years) | 10 years | |
Gross Carrying Amount | $ 4,778 | 4,778 |
Accumulated Amortization | 4,657 | 4,639 |
Net Carrying Amount | $ 121 | 139 |
Trademark/Trade name | ||
Net Carrying Amount | ||
Useful Life (in years) | 15 years | |
Gross Carrying Amount | $ 887 | 887 |
Accumulated Amortization | 669 | 657 |
Net Carrying Amount | 218 | 230 |
Technology/Patent | ||
Net Carrying Amount | ||
Gross Carrying Amount | 15,787 | 15,787 |
Accumulated Amortization | 10,021 | 9,780 |
Net Carrying Amount | $ 5,766 | 6,007 |
Technology/Patent | Minimum | ||
Net Carrying Amount | ||
Useful Life (in years) | 15 years | |
Technology/Patent | Maximum | ||
Net Carrying Amount | ||
Useful Life (in years) | 30 years | |
Software and cloud | ||
Net Carrying Amount | ||
Useful Life (in years) | 3 years | |
Gross Carrying Amount | $ 10,419 | 10,067 |
Accumulated Amortization | 6,370 | 5,571 |
Net Carrying Amount | $ 4,049 | $ 4,496 |
INTANGIBLE ASSETS, NET - Narrat
INTANGIBLE ASSETS, NET - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 1.1 | $ 1 |
INTANGIBLE ASSETS, NET -Sched_2
INTANGIBLE ASSETS, NET -Schedule of Estimated Future Amortization Expense (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Estimated future amortization expense | |
2025 | $ 4,458 |
2026 | 1,412 |
2027 | 1,383 |
2028 | 1,006 |
2029 | 510 |
Thereafter | 2,020 |
Net Carrying Amount | $ 10,789 |
ACCRUED LIABILITIES (Details)
ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | Mar. 31, 2023 |
Payables and Accruals [Abstract] | |||
Accrued purchases | $ 10,020 | $ 17,685 | |
Accrued interest | 321 | 460 | |
Accrued compensation and benefits | 6,206 | 7,605 | |
Accrued taxes other than payroll taxes | 2,223 | 826 | |
RINS obligations | 44,395 | 46,153 | |
Benzene credits obligations | 311 | 531 | |
Unearned revenue | 5,278 | 325 | |
Environmental liabilities - current | 51 | 51 | |
Derivative commodity liability | 435 | 0 | |
Accrued expenses and other current liabilities | $ 69,240 | $ 73,636 | $ 73,636 |
FINANCING ARRANGEMENTS - Schedu
FINANCING ARRANGEMENTS - Schedule of Outstanding Debt Facilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Debt Instrument | ||
Principal amount of long-term debt | $ 216,190 | $ 217,417 |
Less: unamortized discount and deferred financing costs | (25,894) | (30,354) |
Total debt, net of unamortized discount and deferred financing costs | 190,296 | 187,063 |
Less: current maturities, net of unamortized discount and deferred financing costs | (12,524) | (16,362) |
Long-term debt, net of current maturities | 177,772 | 170,701 |
Senior Convertible Note | ||
Debt Instrument | ||
Principal amount of long-term debt | 15,230 | 15,230 |
Term Loan 2025 | ||
Debt Instrument | ||
Principal amount of long-term debt | 195,950 | 195,950 |
Citizens National Bank - Promissory Note | Citizens National Bank | ||
Debt Instrument | ||
Principal amount of long-term debt | 2,611 | 0 |
Various institutions | Various institutions | ||
Debt Instrument | ||
Principal amount of long-term debt | $ 2,399 | $ 6,237 |
FINANCING ARRANGEMENTS - Sche_2
FINANCING ARRANGEMENTS - Schedule of Future Maturities of Notes Payable (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Debt Disclosure [Abstract] | |
2025 | $ 12,524 |
2026 | 185,825 |
2027 | 0 |
2028 | 15,230 |
2029 | 2,611 |
Net carrying amount at end of period | $ 216,190 |
FINANCING ARRANGEMENTS - Short-
FINANCING ARRANGEMENTS - Short-Term Loan (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Debt Instrument | ||
Outstanding principal amount | $ 216,190 | $ 217,417 |
Promissory Note | ||
Debt Instrument | ||
Debt instrument, stated rate (as a percent) | 8.50% | |
Outstanding principal amount | $ 1,000 | 1,300 |
Various institutions | Insurance Premium Financing | ||
Debt Instrument | ||
Outstanding principal amount | $ 1,400 | $ 4,900 |
Minimum | Various institutions | Insurance Premium Financing | ||
Debt Instrument | ||
Debt instrument, stated rate (as a percent) | 3.24% | |
Maximum | Various institutions | Insurance Premium Financing | ||
Debt Instrument | ||
Debt instrument, stated rate (as a percent) | 6.25% |
FINANCING ARRANGEMENTS - Promis
FINANCING ARRANGEMENTS - Promissory Note (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Debt Instrument | ||
Outstanding principal amount | $ 216,190 | $ 217,417 |
Promissory Note | ||
Debt Instrument | ||
Outstanding principal amount | $ 2,600 | |
Debt instrument, stated rate (as a percent) | 7.83% |
FINANCING ARRANGEMENTS - Term L
FINANCING ARRANGEMENTS - Term Loan (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||||
Jun. 28, 2024 | Apr. 15, 2024 | Mar. 22, 2024 | Dec. 28, 2023 | Apr. 15, 2024 | Mar. 31, 2024 | |
Debt Instrument | ||||||
Gain on the sale of land | $ 2,600,000 | |||||
First-Lien Senior Secured Term Loan Facility | Secured Debt | Vertex Refining | ||||||
Debt Instrument | ||||||
Principal amounts at beginning of period | $ 50,000,000 | $ 215,000,000 | ||||
Gain on the sale of land | $ 4,100,000 | |||||
Consideration contingent on railroad infrastructure access mobile refinery | $ 1,500,000 | |||||
First-Lien Senior Secured Term Loan Facility | Secured Debt | Vertex Refining | Subsequent Event | ||||||
Debt Instrument | ||||||
Repayments of debt | $ 2,100,000 | $ 2,100,000 | ||||
Charged to interest expense | $ 9,400,000 | |||||
First-Lien Senior Secured Term Loan Facility | Secured Debt | Vertex Refining | Forecast | ||||||
Debt Instrument | ||||||
Principal payments | $ 2,687,500 | |||||
First-Lien Senior Secured Term Loan Facility | Secured Debt | Vertex Refining | Prime Rate | ||||||
Debt Instrument | ||||||
Variable rate basis, basis spread (in percent) | 1.50% | |||||
First-Lien Senior Secured Term Loan Facility | Secured Debt | Vertex Refining | Federal Funds Rate | ||||||
Debt Instrument | ||||||
Variable rate basis, basis spread (in percent) | (0.50%) | |||||
Effective interest rate (in percent) | 17.25% | |||||
First-Lien Senior Secured Term Loan Facility | Secured Debt | Vertex Refining | Federal Funds Rate | Minimum | ||||||
Debt Instrument | ||||||
Variable rate basis, basis spread (in percent) | (1.00%) | |||||
First-Lien Senior Secured Term Loan Facility | Secured Debt | Vertex Refining | Federal Funds Rate | Maximum | ||||||
Debt Instrument | ||||||
Variable rate basis, basis spread (in percent) | (10.25%) |
FINANCING ARRANGEMENTS - Warran
FINANCING ARRANGEMENTS - Warrant Agreements and Derivative Liabilities (Details) - Initial Warrants - $ / shares | Mar. 31, 2024 | Dec. 28, 2023 | May 26, 2022 | Apr. 01, 2022 |
Class of Warrant or Right [Line Items] | ||||
Warrant outstanding (in shares) | 3,835,000 | 1,000,000 | 250,000 | 2,750,000 |
Shares issued (in dollars per share) | $ 3 | $ 9.25 | $ 4.50 | |
Weighted average exercise price (in dollars per share) | $ 3 |
FINANCING ARRANGEMENTS - Indent
FINANCING ARRANGEMENTS - Indenture and Convertible Senior Notes (Details) - USD ($) | 3 Months Ended | |||
Jun. 12, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Nov. 01, 2021 | |
Line of Credit Facility [Line Items] | ||||
Unamortized debt | $ 33,900,000 | |||
Convertible Notes | Senior Notes | ||||
Line of Credit Facility [Line Items] | ||||
Principal amounts at beginning of period | $ 79,900,000 | $ 60,000,000 | $ 155,000,000 | |
Debt instrument, stated rate (as a percent) | 6.25% | |||
Issue price, percentage | 90% | |||
Common stock issued upon conversion of the convertible notes (in shares) | 17,200,000 | 10,200,000 | ||
Unamortized debt | $ 40,700,000 | |||
Interest paid | 1,000,000 | |||
Inducement cost | $ 21,200,000 |
FINANCING ARRANGEMENTS - Sche_3
FINANCING ARRANGEMENTS - Schedule of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Debt Instrument | ||
Outstanding principal amount | $ 216,190 | $ 217,417 |
Net carrying amount at end of period | 216,190 | |
Senior Convertible Note | ||
Debt Instrument | ||
Principal amounts at beginning of period | 15,230 | 95,178 |
Conversion of principal into common stock | 0 | (79,948) |
Outstanding principal amount | 15,230 | 15,230 |
Unamortized discount and issuance costs | (6,865) | (7,157) |
Net carrying amount at end of period | $ 8,365 | $ 8,073 |
LEASES - Schedule of Finance Le
LEASES - Schedule of Finance Lease Liability (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Lessee, Lease, Description | ||
Finance lease | $ 68,073 | $ 68,641 |
Matheson Tri-Gas | Matheson Tri-Gas | ||
Lessee, Lease, Description | ||
Finance lease | 43,816 | 44,132 |
Plaquemines | Plaquemines | ||
Lessee, Lease, Description | ||
Finance lease | 940 | 994 |
Harvey Ford | Harvey Ford | ||
Lessee, Lease, Description | ||
Finance lease | 36 | 39 |
DLL financial | DLL financial | ||
Lessee, Lease, Description | ||
Finance lease | 45 | 47 |
Diego | Diego | ||
Lessee, Lease, Description | ||
Finance lease | 139 | 137 |
Xerorx | Xerorx | ||
Lessee, Lease, Description | ||
Finance lease | 16 | 0 |
Centerpoint Blakely | Centerpoint Blakely | ||
Lessee, Lease, Description | ||
Finance lease | $ 23,081 | $ 23,292 |
LEASES - Schedule of Finance _2
LEASES - Schedule of Finance Lease, Liability, Fiscal Year Maturity (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Finance Lease, Liability, to be Paid [Abstract] | ||
2025 | $ 8,459 | |
2026 | 8,462 | |
2027 | 8,455 | |
2028 | 27,847 | |
2029 | 6,588 | |
Thereafter | 56,240 | |
Total lease payments | 116,051 | |
Less: interest | (47,978) | |
Present value of financing lease liabilities | 68,073 | $ 68,641 |
Less: current portion of lease liabilities | (2,497) | (2,435) |
Total lease liabilities, net of current portion | $ 65,576 | $ 66,206 |
LEASES - Schedule of Finance _3
LEASES - Schedule of Finance Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Lease Cost Type | ||
Amortization of finance lease ROU assets | $ 993 | $ 784 |
Interest on lease liabilities | 1,522 | 1,382 |
Net finance lease costs | $ 2,515 | $ 2,166 |
LEASES - Schedule of Lease Cost
LEASES - Schedule of Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Lease Cost Type | ||
Operating lease cost | $ 7,499 | $ 3,070 |
Variable lease cost | 659 | 260 |
Short-term lease cost | 6,651 | 1,929 |
Net lease cost | $ 14,809 | $ 5,259 |
LEASES - Schedule of Cash Flow,
LEASES - Schedule of Cash Flow, Supplemental Disclosures Related to Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Leases [Abstract] | ||
Payments on financing lease | $ 586 | $ 310 |
Payments on operating lease | 7,499 | 3,070 |
ROU assets obtained from new finance lease liabilities | 18 | 15,024 |
ROU assets obtained from new operating lease liabilities | 74 | 15,078 |
ROU assets terminated from release of operating lease liabilities | $ (17,666) | $ 0 |
LEASES - Schedule of Maturities
LEASES - Schedule of Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Lessee, Lease, Description | ||
2025 | $ 21,971 | |
2026 | 15,618 | |
2027 | 13,680 | |
2028 | 11,751 | |
2029 | 7,491 | |
Thereafter | 73,365 | |
Total lease payments | 143,876 | |
Less: interest | (66,250) | |
Present value of operating lease liabilities | 77,626 | |
Less: current portion of lease liabilities | (13,281) | $ (20,296) |
Total lease liabilities, net of current portion | 64,345 | $ 74,444 |
Facilities | ||
Lessee, Lease, Description | ||
2025 | 975 | |
2026 | 818 | |
2027 | 631 | |
2028 | 606 | |
2029 | 545 | |
Thereafter | 1,293 | |
Total lease payments | 4,868 | |
Less: interest | (1,391) | |
Present value of operating lease liabilities | 3,477 | |
Less: current portion of lease liabilities | (621) | |
Total lease liabilities, net of current portion | 2,856 | |
Equipment | ||
Lessee, Lease, Description | ||
2025 | 12,300 | |
2026 | 6,512 | |
2027 | 5,058 | |
2028 | 3,438 | |
2029 | 0 | |
Thereafter | 0 | |
Total lease payments | 27,308 | |
Less: interest | (4,269) | |
Present value of operating lease liabilities | 23,039 | |
Less: current portion of lease liabilities | (10,076) | |
Total lease liabilities, net of current portion | 12,963 | |
Plant | ||
Lessee, Lease, Description | ||
2025 | 8,009 | |
2026 | 7,721 | |
2027 | 7,745 | |
2028 | 7,603 | |
2029 | 6,946 | |
Thereafter | 72,072 | |
Total lease payments | 110,096 | |
Less: interest | (60,455) | |
Present value of operating lease liabilities | 49,641 | |
Less: current portion of lease liabilities | (2,025) | |
Total lease liabilities, net of current portion | 47,616 | |
Railcar | ||
Lessee, Lease, Description | ||
2025 | 687 | |
2026 | 567 | |
2027 | 246 | |
2028 | 104 | |
2029 | 0 | |
Thereafter | 0 | |
Total lease payments | 1,604 | |
Less: interest | (135) | |
Present value of operating lease liabilities | 1,469 | |
Less: current portion of lease liabilities | (559) | |
Total lease liabilities, net of current portion | $ 910 |
LEASES - Schedule of Operating
LEASES - Schedule of Operating and Financing Lease Weighted Average Remaining Lease Terms and Discount Rates (Details) | Mar. 31, 2024 |
Lease facilities | |
Lessee, Lease, Description | |
Operating lease, Weighted average remaining lease terms (years) | 4 years 11 months 8 days |
Operating lease, Weighted average discount rate (in pure) | 11.07% |
Financing lease, Weighted average discount rate (in pure) | 0% |
Lease equipment | |
Lessee, Lease, Description | |
Operating lease, Weighted average remaining lease terms (years) | 1 year 10 months 24 days |
Operating lease, Weighted average discount rate (in pure) | 12.11% |
Financing lease, Weighted average remaining lease terms (years) | 3 years 10 months 13 days |
Financing lease, Weighted average discount rate (in pure) | 9.19% |
Lease plant | |
Lessee, Lease, Description | |
Operating lease, Weighted average remaining lease terms (years) | 13 years 6 months 18 days |
Operating lease, Weighted average discount rate (in pure) | 12.31% |
Financing lease, Weighted average remaining lease terms (years) | 14 years 1 month 28 days |
Financing lease, Weighted average discount rate (in pure) | 8.89% |
Railcar | |
Lessee, Lease, Description | |
Operating lease, Weighted average remaining lease terms (years) | 2 years 2 months 15 days |
Operating lease, Weighted average discount rate (in pure) | 10.72% |
Financing lease, Weighted average discount rate (in pure) | 0% |
LEASES - Narrative (Details)
LEASES - Narrative (Details) | Mar. 31, 2024 |
Minimum | |
Lessee, Lease, Description | |
Lease renewal term | 1 year |
Maximum | |
Lessee, Lease, Description | |
Lease renewal term | 5 years |
EQUITY (Details)
EQUITY (Details) | 3 Months Ended | ||
Mar. 31, 2024 segment $ / shares shares | Mar. 31, 2023 shares | Dec. 31, 2023 shares | |
Conversion of Stock | |||
Common stock, shares authorized (in shares) | 750,000,000 | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | ||
Common stock, shares outstanding (in shares) | 93,514,346 | 93,514,346 | |
Common stock, shares issued (in shares) | 93,514,346 | 93,514,346 | |
Number of votes per share of common stock | segment | 1 | ||
Common Stock | |||
Conversion of Stock | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | ||
Exercise of options to purchase common stock (in shares) | 166,000 | 166,000 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 USD ($) $ / shares shares | Mar. 31, 2023 USD ($) $ / shares shares | |
Numerator: | ||
Net income (loss) attributable to common shareholders from continuing operations | $ | $ (17,734) | $ 3,523 |
Net income attributable to common shareholders from discontinued operations, net of tax | $ | 0 | 50,340 |
Net income (loss) attributable to common shareholders, basic | $ | $ (17,734) | $ 53,863 |
Weighted-average common shares outstanding (in shares) | shares | 93,514 | 75,689 |
Continuing operations (in dollars per share) | $ (0.19) | $ 0.05 |
Discontinued operations, net of tax (in dollars per share) | 0 | 0.66 |
Basic income (loss) per common share (in dollars per share) | $ (0.19) | $ 0.71 |
Weighted Average Number of Shares Outstanding, Basic [Abstract] | ||
Net income (loss) attributable to common shareholders | $ | $ (17,734) | $ 53,863 |
Stock options and warrants (in shares) | shares | 0 | 3,307 |
Diluted weighted-average shares outstanding (in shares) | shares | 93,514 | 78,996 |
Continuing operations (in dollars per share) | $ (0.19) | $ 0.04 |
Discontinued operations, net of tax (in dollars per share) | 0 | 0.64 |
Diluted income (loss) per share (in dollars per share) | $ (0.19) | $ 0.68 |
Debt instrument, conversion ratio (as a percent) | 233.6449 | |
Senior Convertible Note | ||
Weighted Average Number of Shares Outstanding, Basic [Abstract] | ||
Shared excluded from computation of earnings per share, amount | shares | 3,600 | 22,200 |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of Fair Value, by Balance Sheet Grouping (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | $ 603 | $ 11 |
Total liabilities at fair value | (48,390) | (56,591) |
Total | (47,787) | (56,580) |
Level 1 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | 0 | 0 |
Total liabilities at fair value | 0 | 0 |
Total | 0 | 0 |
Level 2 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | 603 | 11 |
Total liabilities at fair value | (45,141) | (46,684) |
Total | (44,538) | (46,673) |
Level 3 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | 0 | 0 |
Total liabilities at fair value | (3,249) | (9,907) |
Total | (3,249) | (9,907) |
RINS and environmental credits | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | (603) | |
Total liabilities at fair value | (44,706) | (46,684) |
RINS and environmental credits | Level 1 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | 0 | |
Total liabilities at fair value | 0 | 0 |
RINS and environmental credits | Level 2 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | (603) | |
Total liabilities at fair value | (44,706) | (46,684) |
RINS and environmental credits | Level 3 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | 0 | |
Total liabilities at fair value | 0 | 0 |
Commodity | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | 11 | |
Total liabilities at fair value | 435 | |
Total | (435) | 11 |
Commodity | Level 1 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | 0 | |
Total liabilities at fair value | 0 | |
Commodity | Level 2 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | 11 | |
Total liabilities at fair value | 435 | |
Commodity | Level 3 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total assets at fair value | 0 | |
Total liabilities at fair value | 0 | |
Derivative warrants | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total liabilities at fair value | (3,249) | (9,907) |
Derivative warrants | Level 1 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total liabilities at fair value | 0 | 0 |
Derivative warrants | Level 2 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total liabilities at fair value | 0 | 0 |
Derivative warrants | Level 3 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total liabilities at fair value | $ (3,249) | $ (9,907) |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) - shares | Mar. 31, 2024 | Dec. 28, 2023 | May 26, 2022 | Apr. 01, 2022 |
Initial Warrants | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Warrant outstanding (in shares) | 3,835,000 | 1,000,000 | 250,000 | 2,750,000 |
FAIR VALUE MEASUREMENTS - Dynam
FAIR VALUE MEASUREMENTS - Dynamic Black-Scholes Merton unobservable inputs (Details) - Stock Option | 3 Months Ended |
Mar. 31, 2024 | |
Initial Warrants | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Expected dividend rate (in percent) | 0% |
Expected volatility rate, minimum (in percent) | 113.23% |
Risk free interest rate, minimum (in percent) | 4.40% |
Expected term (in years) | 3 years 3 days |
Additional Warrants | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Expected dividend rate (in percent) | 0% |
Expected volatility rate, maximum (in percent) | 115.74% |
Risk free interest rate, maximum (in percent) | 4.31% |
Expected term (in years) | 3 years 8 months 1 day |
New Warrants | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Expected dividend rate (in percent) | 0% |
Expected volatility rate, maximum (in percent) | 109.89% |
Risk free interest rate, maximum (in percent) | 4.21% |
Expected term (in years) | 4 years 9 months 3 days |
FAIR VALUE MEASUREMENTS - Sch_2
FAIR VALUE MEASUREMENTS - Schedule of Liabilities with Unobservable Inputs (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance at beginning of period | $ 9,907 | $ 14,270 |
New warrants granted | 0 | 2,905 |
Repricing warrants granted | 0 | 724 |
Change in valuation of warrants included in net income | (6,658) | (7,992) |
Balance at end of period | $ 3,249 | $ 9,907 |
COMMODITY DERIVATIVE INSTRUME_3
COMMODITY DERIVATIVE INSTRUMENTS - Schedule of Derivative Instruments (Details) bbl in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 USD ($) $ / bbl bbl | Dec. 31, 2023 USD ($) $ / bbl bbl | |
Derivative | ||
Fair Value | $ (47,787) | $ (56,580) |
Mar. 2024-May. 2024 | ||
Derivative | ||
Weighted average strike price (in usd per barrel) | $ / bbl | 110.37 | |
Remaining Volume (Barrels) | bbl | 38 | |
Fair Value | $ (8) | |
Mar. 2024-Jun. 2024 | ||
Derivative | ||
Weighted average strike price (in usd per barrel) | $ / bbl | 86 | |
Remaining Volume (Barrels) | bbl | 124 | |
Fair Value | $ (124) | |
Mar. 2024-May. 2024 | ||
Derivative | ||
Weighted average strike price (in usd per barrel) | $ / bbl | 46.10 | |
Remaining Volume (Barrels) | bbl | 273 | |
Fair Value | $ (303) | |
Dec. 2023 - Feb. 2024 | ||
Derivative | ||
Weighted average strike price (in usd per barrel) | $ / bbl | 108.18 | |
Remaining Volume (Barrels) | bbl | 1 | |
Fair Value | $ 20 | |
Dec. 2023 - Feb. 2024 | ||
Derivative | ||
Weighted average strike price (in usd per barrel) | $ / bbl | 110.33 | |
Remaining Volume (Barrels) | bbl | 4 | |
Fair Value | $ (156) | |
Dec. 2023 - May. 2024 | ||
Derivative | ||
Weighted average strike price (in usd per barrel) | $ / bbl | 77.94 | |
Remaining Volume (Barrels) | bbl | 7 | |
Fair Value | $ (63) | |
Dec. 2023 - May. 2024 | ||
Derivative | ||
Weighted average strike price (in usd per barrel) | $ / bbl | 49.94 | |
Remaining Volume (Barrels) | bbl | 60 | |
Fair Value | $ 632 | |
Dec. 2023 - Jan. 2024 | ||
Derivative | ||
Weighted average strike price (in usd per barrel) | $ / bbl | 88.39 | |
Remaining Volume (Barrels) | bbl | 164 | |
Fair Value | $ (372) | |
Dec. 2023 - Jan. 2024 | ||
Derivative | ||
Weighted average strike price (in usd per barrel) | $ / bbl | 25.55 | |
Remaining Volume (Barrels) | bbl | 100 | |
Fair Value | $ (50) |
COMMODITY DERIVATIVE INSTRUME_4
COMMODITY DERIVATIVE INSTRUMENTS - Schedule of Fair Value of Derivative Instruments within Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Derivative | ||
Derivative commodity asset(liability) | $ (47,787) | $ (56,580) |
Soybean oil future | ||
Derivative | ||
Derivative commodity asset(liability) | (303) | 632 |
Crude oil swaps | ||
Derivative | ||
Derivative commodity asset(liability) | 0 | (422) |
Crude oil futures | ||
Derivative | ||
Derivative commodity asset(liability) | (132) | (199) |
Commodity | ||
Derivative | ||
Derivative commodity asset(liability) | $ (435) | $ 11 |
COMMODITY DERIVATIVE INSTRUME_5
COMMODITY DERIVATIVE INSTRUMENTS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
(Gain) loss on commodity derivative contracts | $ 1,322 | $ (1,516) |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate (as a percent) | 0% | 26% |
Income (loss) from continuing operations before income tax | $ (17,854) | $ 4,486 |
Income tax expense | $ 0 | 1,013 |
Income tax expense from discontinued operation | $ 17,700 |
DISCONTINUED OPERATIONS - Narra
DISCONTINUED OPERATIONS - Narrative (Details) $ in Millions | Feb. 01, 2023 USD ($) |
Held-for-sale | UMO Business | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Total cash, consideration | $ 87.2 |
DISCONTINUED OPERATIONS - Sched
DISCONTINUED OPERATIONS - Schedule of Income Statement Disclosures by Disposal Groups (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Income from discontinued operations, net of tax | $ 0 | $ 50,340 |
Held-for-sale | UMO Business | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Revenues | 7,366 | |
Cost of revenues (exclusive of depreciation shown separately below) | 4,589 | |
Depreciation and amortization attributable to costs of revenues | 124 | |
Gross profit | 2,653 | |
Selling, general and administrative expenses (exclusive of depreciation shown separately below) | 632 | |
Depreciation and amortization expense attributable to operating expenses | 21 | |
Total operating expenses | 653 | |
Income before income tax | 2,000 | |
Income tax expense | (528) | |
Gain on sale of discontinued operations, net of $17,218 of tax | 48,868 | |
Income from discontinued operations, net of tax | $ 50,340 | |
Gain on sale of discontinued operations, tax | $ 17,218 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Legal Services | Related Party | ||
Related Party Transaction [Line Items] | ||
Related party transactions | $ 172 | $ 185 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ in Millions | 1 Months Ended | ||||
Apr. 15, 2024 | Apr. 01, 2024 | Apr. 15, 2024 | Mar. 31, 2024 | Dec. 31, 2023 | |
Subsequent Event [Line Items] | |||||
Common stock, shares outstanding (in shares) | 93,514,346 | 93,514,346 | |||
Subsequent Event | First-Lien Senior Secured Term Loan Facility | Secured Debt | Vertex Refining | |||||
Subsequent Event [Line Items] | |||||
Repayments of debt | $ 2.1 | $ 2.1 | |||
Interest paid | $ 8.5 | ||||
Common Stock | 2020 Incentive Plan | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Number of shares available for issuance (in shares) | 3,740,573 | ||||
Common stock issue shares (in shares) | 5,240,574 | ||||
Debt instrument, stated rate (as a percent) | 4% | ||||
Common stock, shares outstanding (in shares) | 93,514,346 |