Vertex Energy Inc. reported large increases in gross profit and revenues for the quarter ended Dec. 31 and full year 2021 for its used motor oil collection and processing business.
The company said it is continuing to seek a buyer for the unit after canceling a planned sale in January.
Under an agreement announced in June 2021, Safety-Kleen parent company Clean Harbors would have paid $140 million in cash to acquire Vertex Energy’s Heartland base oil rerefinery in Ohio, a second rerefinery in Louisiana and its used oil collections businesses. However, in January this year, Vertex entered into a mutual agreement with Safety-Kleen to terminate the sales agreement, given considerable time and resources required to continue to support efforts associated with multiple requests from the U.S. Federal Trade Commission.
“However, the company is continuing to explore opportunities for sale of the [used motor oil] business,” Vertex stated in its earnings SEC filing, and it continues to classify its used motor oil collection and processing business as discontinued operations.
Gross profit from those operations jumped 235% to $15.3 million in the fourth quarter, improving from $4.6 million. Income from operations in the fourth quarter ballooned to $10.3 million, 10,280% higher than a $99,440 mark in the same period in 2020.
Fourth-quarter revenue from the discontinued operations rose 98% to $44.7 million for the quarter ending Dec. 31, compared to $22.6 million in the same period in 2020.
For the full year, gross profit from those operations reached $44.6 million, a 195% improvement from $15.1 million in 2020 and 100% higher than 2020’s $22.3 million gross profit. Income from operations improved to $23.1 million for 2021, compared to a $4.8 million loss from operations in 2020 and was 688% higher than $2.9 million in income from operations for 2019.
Revenues from the discontinued operations jumped 70% to $149.9 million in 2021, compared to $88 million in 2020 and was 3% ahead of 2019’s $145 million in sales.
Vertex operates a rerefinery in Columbus, Ohio, which can produce 1,500 barrels per day of API Group II base stocks and a rerefinery in Marrero, Louisiana, which produces finished vacuum gas oil. “We delivered record fourth quarter and full-year results, driven by a combination of improved refined product margins, increased sales volumes and strong operational execution at both the Marrero and Heartland refineries,” Benjamin P. Cowart, president and CEO of Vertex Energy, said in an earnings news release.