AE(AE) - 2024 Q3 - Quarterly Report

Crude Oil Marketing - Crude oil marketing revenues decreased by $59.1 million (8$79.26 per barrel in Q3 2023 to $73.99 per barrel in Q3 2024[97] - Crude oil field level volumes decreased due to the expiration of a five-year purchase contract in the Red River area, resulting in a loss of 25,000 to 28,000 barrels per day[98] - Crude oil marketing operating earnings decreased by$5.4 million (70%) in Q3 2024 compared to Q3 2023, primarily due to inventory valuation changes and lower volumes[102] - Crude oil marketing revenues increased by $53.8 million (3$2.3 million, compared to $7.7 million in the same period in 2023[111] - Crude oil inventory increased to 411,426 barrels at an average price of$71.35 per barrel as of September 30, 2024, compared to 267,731 barrels at $72.35 per barrel as of December 31, 2023[113] - Crude oil inventory increased by$10.2 million at September 30, 2024, primarily due to a 53.7% increase in the number of barrels held in inventory, despite a decrease in crude oil price from $72.35 to$71.35 per barrel[158] Driver Compensation and Related Costs - Driver compensation decreased by $1.4 million (28$4.5 million (30%) in the nine months ended September 30, 2024, compared to the same period in 2023, primarily due to lower volumes and driver count[104] Insurance and Fuel Costs - Insurance costs decreased by $0.5 million (25$0.9 million (35%) in Q3 2024 compared to Q3 2023, primarily due to lower driver count and crude oil volumes[100] Depreciation and Amortization - Depreciation and amortization decreased by $0.7 million (35$4.4 million for the three months ended September 30, 2024, up from $2.7 million in the same period in 2023, primarily due to lower operating costs[112] Transportation Segment - Transportation revenues decreased by 10$21.8 million for the three months ended September 30, 2024, compared to $24.2 million in the same period in 2023[115] - Transportation operating losses were$542,000 for the three months ended September 30, 2024, compared to operating earnings of $1.6 million in the same period in 2023[115] Pipeline and Storage Segment - Pipeline and storage segment revenues increased by 37$1.1 million for the three months ended September 30, 2024, compared to $770,000 in the same period in 2023[127] - Pipeline throughput increased to 10,326 barrels per day for the three months ended September 30, 2024, up from 8,548 barrels per day in the same period in 2023[128] - Terminalling volumes increased to 11,319 barrels per day for the three months ended September 30, 2024, up from 9,350 barrels per day in the same period in 2023[128] - Pipeline and storage operating losses increased to$1.1 million for the three months ended September 30, 2024, compared to $866,000 in the same period in 2023[129] - Pipeline and storage revenues decreased by$0.2 million for the nine months ended September 30, 2024 compared to the same period in 2023, primarily due to lower revenues from third-party customers[130][131] Firebird and Phoenix Operations - Revenues from Firebird operations decreased by $1.9 million for the three months ended September 30, 2024 compared to the same period in 2023, primarily due to decreased transportation volumes[132] - Revenues from Phoenix operations decreased by$2.0 million for the three months ended September 30, 2024 compared to the same period in 2023, primarily due to lower volumes and activity[132] - Revenues from Firebird operations decreased by $1.1 million for the nine months ended September 30, 2024 compared to the same period in 2023, primarily due to decreased transportation volumes[136] - Revenues from Phoenix operations decreased by$6.0 million for the nine months ended September 30, 2024 compared to the same period in 2023, primarily due to lower volumes and activity[136] Logistics and Repurposing Segment - Logistics and repurposing segment operating losses increased by $1.4 million for the three months ended September 30, 2024 compared to the same period in 2023, primarily due to lower revenues from Firebird and Phoenix operations[135] - Logistics and repurposing segment operating earnings decreased by$6.2 million for the nine months ended September 30, 2024 compared to the same period in 2023, primarily due to lower revenues from Firebird and Phoenix operations[139] General and Administrative Expenses - General and administrative expense increased by $3.1 million for the nine months ended September 30, 2024 compared to the same period in 2023, primarily due to higher salaries and wages, audit fees, and legal fees[141] Interest Expense and Credit Agreement - Interest expense decreased by$0.5 million for the nine months ended September 30, 2024 compared to the same period in 2023, primarily due to lower borrowings under the Credit Agreement[144] - The company amended its Credit Agreement to lower the maximum Consolidated Total Leverage Ratio to 2.00 to 1.00 and increase the minimum Asset Coverage Ratio to 2.50 to 1.00, effective from the fiscal quarter ending September 30, 2024[152] - As of September 30, 2024, the company had $15.0 million in borrowings under the Credit Agreement at a weighted average interest rate of 7.60$11.5 million in letters of credit issued at a fee of 2.25% per annum[153] Cash and Cash Equivalents - Cash and cash equivalents decreased by 25% to $25.1 million at September 30, 2024 compared to December 31, 2023[147] - The company's operating cash flows increased by$6.9 million for the nine months ended September 30, 2024, compared to the same period in 2023, driven by changes in working capital accounts[158] Capital Spending and Investing Activities - Net cash flows used in investing activities increased by $5.0 million for the nine months ended September 30, 2024, compared to the same period in 2023, due to higher capital spending of$4.4 million[162] - Capital spending for the nine months ended September 30, 2024, totaled $13.3 million, with significant investments in logistics and repurposing ($4.6 million) and transportation ($4.4 million)[163] Financing Activities - Net cash used in financing activities was$13.6 million for the nine months ended September 30, 2024, primarily due to increased repayments under the Credit Agreement and no share sales under the ATM Agreement[164] - The company paid cash dividends of $0.72 per common share for both the nine months ended September 30, 2024, and 2023, totaling$1.9 million in each period[164] Contractual Obligations - The company's total contractual obligations at September 30, 2024, amounted to $49.8 million, including$17.6 million under the Credit Agreement and $23.4 million in finance lease obligations[165] Off-Balance Sheet Arrangements - 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[167]