AE(AE) - 2024 Q2 - Quarterly Report

Crude Oil Marketing Performance - Crude oil marketing revenues increased by $97.6 million (17$352.5 million, partially offset by lower volumes, which reduced revenues by $254.9 million[113][115] - Average crude oil purchase price rose to$79.56 per barrel in Q2 2024 from $70.27 per barrel in Q2 2023, primarily due to OPEC production cuts and geopolitical events[114][115] - Crude oil field level purchase volumes decreased to 67,099 barrels per day in Q2 2024 from 92,152 barrels per day in Q2 2023, largely due to the expiration of a five-year contract in the Red River area[114][116] - Operating earnings for crude oil marketing increased by$2.2 million (66%) in Q2 2024 compared to Q2 2023, driven by higher crude oil prices and lower costs, partially offset by reduced volumes[113][118] - Crude oil marketing revenues increased by $112.9 million (9$642.8 million, partially offset by lower volumes, which reduced revenues by $529.9 million[113][119] - Operating earnings for crude oil marketing increased by$7.0 million (132%) in H1 2024 compared to H1 2023, driven by inventory valuation changes, higher crude oil prices, and lower costs, partially offset by reduced volumes[113][123] - Field level operating earnings increased to $6,017 million for the three months ended June 30, 2024, compared to$4,489 million in the same period in 2023, driven by higher crude oil prices and lower operating costs[127][128] - Crude oil inventory decreased to 244,871 barrels at an average price of $79.80 per barrel as of June 30, 2024, compared to 267,731 barrels at$72.35 per barrel as of December 31, 2023[128] - Crude oil inventory increased by $0.1 million at June 30, 2024, with the price per barrel rising from$72.35 at December 31, 2023, to $79.80 at June 30, 2024, despite a decrease of 8.5$22,756 million for the three months ended June 30, 2024, compared to $24,452 million in the same period in 2023, due to lower volumes and transportation rates[130][133] - Transportation operating earnings decreased by 40$637 million for the three months ended June 30, 2024, compared to $1,056 million in the same period in 2023, primarily due to lower revenues and higher fuel costs[130][136] - Pipeline and storage revenues increased by 40$1,256 million for the three months ended June 30, 2024, compared to $894 million in the same period in 2023, driven by higher volumes transported by GulfMark[141][143] - Pipeline and storage operating losses increased by 53$1,188 million for the three months ended June 30, 2024, compared to $779 million in the same period in 2023, due to lower revenues from third-party customers and higher operating costs[141][144] - Pipeline throughput increased to 13,881 barrels per day for the three months ended June 30, 2024, compared to 8,560 barrels per day in the same period in 2023[142] - Terminalling volumes increased to 16,660 barrels per day for the three months ended June 30, 2024, compared to 10,785 barrels per day in the same period in 2023[142] - Firebird revenues increased by 8$6.266 million in Q2 2024 compared to $5.784 million in Q2 2023, driven by higher transportation rates and volumes[147][148] - Phoenix revenues decreased by 26$6.626 million in Q2 2024 compared to $9.009 million in Q2 2023, primarily due to lower volumes and activity[147][148] - Total revenues decreased by 13$12.892 million in Q2 2024 compared to $14.793 million in Q2 2023[147] - Operating losses increased by 2,149$(2.991) million in Q2 2024 compared to $(133) thousand in Q2 2023, driven by lower Phoenix revenues and higher insurance costs[147][150] Cost Management and Expenses - Driver compensation decreased by$1.6 million (31%) in Q2 2024 compared to Q2 2023, primarily due to lower volumes and a reduced driver count following the Red River area contract expiration[113][117] - Insurance costs decreased by $0.7 million (41$0.8 million (32%) in Q2 2024 compared to Q2 2023, primarily due to reduced driver count and lower crude oil volumes[113][117] - Depreciation and amortization decreased by $0.7 million (33$2,564 million for the three months ended June 30, 2024, compared to $2,174 million in the same period in 2023, due to higher fuel prices[130][135] - Insurance costs decreased by 28$1,613 million for the three months ended June 30, 2024, compared to $2,246 million in the same period in 2023, due to lower insurance claims and a reduced driver count[130][135] - Insurance costs increased by 270$2.369 million in Q2 2024 compared to $640 thousand in Q2 2023, primarily due to insurance claims[147][149] - Driver commissions increased by 20$2.519 million in Q2 2024 compared to $2.098 million in Q2 2023, driven by a higher driver count[147][149] - General and administrative expenses increased by$2.7 million in Q2 2024 compared to Q2 2023, primarily due to higher salaries, wages, and related personnel costs[155] Financial Position and Cash Flows - Cash and cash equivalents increased by 16% to $38.512 million as of June 30, 2024, compared to$33.256 million as of December 31, 2023[162] - The company had $15.6 million of borrowings outstanding under the Credit Agreement at a weighted average interest rate of 7.67$20.0 million capacity remains unsold[168] - Net cash flows from operating activities increased by $25.0 million in the six months ended June 30, 2024, compared to the same period in 2023, primarily due to changes in working capital accounts[172] - Early payments received from customers increased by approximately$12.6 million in the 2024 period, while early payments made to suppliers increased by approximately $2.2 million[172] - Net cash flows used in investing activities increased by$1.7 million in the six months ended June 30, 2024, driven by a $2.6 million increase in capital spending for property and equipment[175] - Capital spending by reporting segment totaled$8.5 million in the six months ended June 30, 2024, compared to $5.9 million in the same period in 2023[177] - Net cash used in financing activities was$10.8 million for the six months ended June 30, 2024, compared to $5.2 million in the same period in 2023, primarily due to increased repayments under the Credit Agreement[178] - Total contractual obligations at June 30, 2024, amounted to$53.3 million, including $18.6 million under the Credit Agreement,$25.3 million in finance lease obligations, and $4.5 million in purchase obligations[181] - The company made principal payments of$6.3 million on the Term Loan during the six months ended June 30, 2024, compared to $1.3 million in the same period in 2023[178] - Cash dividends paid on common shares totaled$1.3 million in both the six months ended June 30, 2024, and 2023, at a rate of $0.48 per common share[178] - The company has no off-balance sheet arrangements that are expected to have a material effect on its financial position, results of operations, or cash flows[183]