SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM _________________ to ________________________
COMMISSION FILE NUMBER 1-9533
WORLD FUEL SERVICES CORPORATION
(Exact name of registrant as specified in its charter)
Florida 59-2459427
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
700 South Royal Poinciana Blvd., Suite 800
Miami Springs, Florida 33166
(Address of Principal Executive offices) (Zip Code)
Registrant's Telephone Number, including area code: (305) 884-2001
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of September 30, 1996, the registrant had a total of 8,042,518 shares
of common stock, par value $0.01 per share, issued and outstanding.
Page 1 of 18
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The following unaudited, condensed consolidated financial statements of
World Fuel Services Corporation (the "Company") have been prepared in accordance
with the instructions to Form 10-Q and, therefore, omit or condense certain
footnotes and other information normally included in financial statements
prepared in accordance with generally accepted accounting principles. In the
opinion of management, all adjustments necessary for a fair presentation of the
financial information for the interim periods reported have been made. Results
of operations for the six months ended September 30, 1996, will not be
necessarily indicative of the results for the entire fiscal year ending March
31, 1997.
Page 2 of 18
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<TABLE>
<CAPTION>
WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
ASSETS
SEPTEMBER 30, MARCH 31,
1996 1996
------------- ------------
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $15,577,000 $12,856,000
Accounts receivable, net of allowance
for bad debts of $4,400,000 and
$4,363,000 at September 30 and
March 31, 1996, respectively 61,685,000 62,745,000
Inventories 5,051,000 4,592,000
Prepaid expenses and other current assets 7,663,000 3,059,000
------------ ------------
Total current assets 89,976,000 83,252,000
------------ ------------
PROPERTY, PLANT AND EQUIPMENT, at cost:
Land 601,000 601,000
Buildings and improvements 2,972,000 2,890,000
Office equipment and furniture 3,045,000 2,645,000
Plant, machinery and equipment 14,484,000 14,171,000
Construction in progress 682,000 67,000
------------ ------------
21,784,000 20,374,000
Less accumulated depreciation
and amortization 6,408,000 5,856,000
------------ ------------
15,376,000 14,518,000
------------ ------------
OTHER ASSETS:
Unamortized cost in excess of net
assets of acquired companies, net of
accumulated amortization 11,966,000 12,123,000
Other 1,207,000 2,081,000
------------ -----------
$118,525,000 $111,974,000
============ ============
</TABLE>
(Continued)
Page 3 of 18
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<TABLE>
<CAPTION>
WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
SEPTEMBER 30, MARCH 31,
1996 1996
------------- ------------
<S> <C> <C>
CURRENT LIABILITIES:
Current maturities of long-term debt $ 1,934,000 $ 1,944,000
Accounts payable and accrued expenses 39,111,000 37,808,000
Customer deposits 1,349,000 1,467,000
Accrued salaries and wages 1,633,000 2,055,000
Income taxes payable 862,000 432,000
------------ ------------
Total current liabilities 44,889,000 43,706,000
------------ ------------
LONG-TERM LIABILITIES:
Long-term debt, net of current maturities 2,090,000 2,103,000
Deferred compensation 1,529,000 1,572,000
Deferred income taxes 1,078,000 843,000
------------ ------------
4,697,000 4,518,000
------------ ------------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Preferred stock, $1.00 par value;
100,000 shares authorized, none issued -- --
Common stock, $0.01 par value;
10,000,000 shares authorized,
8,043,000 and 8,039,000 shares issued
and outstanding at September 30 and
March 31, 1996, respectively 81,000 80,000
Capital in excess of par value 22,652,000 22,615,000
Retained earnings 46,263,000 41,112,000
Less treasury stock, at cost 57,000 57,000
------------ ------------
68,939,000 63,750,000
------------ ------------
$118,525,000 $111,974,000
============ ============
</TABLE>
Page 4 of 18
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<TABLE>
<CAPTION>
WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
SIX MONTHS ENDED SEPTEMBER 30,
-----------------------------------
1996 1995
------------ ------------
<S> <C> <C>
Revenue $351,043,000 $284,618,000
Cost of Sales 327,785,000 265,533,000
------------ ------------
Gross profit 23,258,000 19,085,000
------------ ------------
Operating expenses:
Salaries and wages 6,872,000 6,195,000
Provision for bad debts 2,534,000 836,000
Other 5,585,000 4,648,000
------------ ------------
14,991,000 11,679,000
------------ ------------
Income from operations 8,267,000 7,406,000
------------ ------------
Other income (expense), net:
Equity in earnings of
aviation joint venture 880,000 856,000
Other, net 198,000 (32,000)
------------ ------------
1,078,000 824,000
------------ ------------
Income before income taxes 9,345,000 8,230,000
Provision for income taxes 2,988,000 3,030,000
------------ ------------
Net income $ 6,357,000 $ 5,200,000
============ ============
Net income per share $ 0.78 $ 0.65
============ ============
Weighted average shares outstanding 8,178,000 8,050,000
============ ============
</TABLE>
Page 5 of 18
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<TABLE>
<CAPTION>
WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
THREE MONTHS ENDED SEPTEMBER 30,
-----------------------------------
1996 1995
------------ ------------
<S> <C> <C>
Revenue $180,349,000 $145,658,000
Cost of sales 168,723,000 135,747,000
------------ ------------
Gross profit 11,626,000 9,911,000
------------ ------------
Operating expenses:
Salaries and wages 3,666,000 3,189,000
Provision for bad debts 1,216,000 686,000
Other 2,814,000 2,292,000
------------ ------------
7,696,000 6,167,000
------------ ------------
Income from operations 3,930,000 3,744,000
------------ ------------
Other income (expense), net:
Equity in earnings of
aviation joint venture 471,000 479,000
Other, net 211,000 (41,000)
------------ ------------
682,000 438,000
------------ ------------
Income before income taxes 4,612,000 4,182,000
Provision for income taxes 1,359,000 1,527,000
------------ ------------
Net income $ 3,253,000 $ 2,655,000
============ ============
Net income per share $ 0.40 $ 0.33
============ ============
Weighted average shares outstanding 8,173,000 8,076,000
============ ============
</TABLE>
Page 6 of 18
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<TABLE>
<CAPTION>
WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
SIX MONTHS ENDED SEPTEMBER 30,
-----------------------------------
1996 1995
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 6,357,000 $ 5,200,000
------------ ------------
Adjustments to reconcile net
income to net cash provided by
operating activities -
Depreciation and amortization 918,000 816,000
Provision for bad debts 2,534,000 836,000
Deferred income tax provision 235,000 559,000
Equity in earnings of aviation
joint venture, net (562,000) (148,000)
Other non-cash operating charges 5,000 30,000
Changes in assets and liabilities,
net of dispositions:
(Increase) decrease in -
Accounts receivable (1,474,000) (7,590,000)
Inventories (459,000) (133,000)
Prepaid expenses and other
current assets (4,025,000) 569,000
Other assets 773,000 (164,000)
Increase (decrease) in -
Accounts payable and accrued
expenses 1,102,000 6,875,000
Customer deposits (118,000) (201,000)
Accrued salaries and wages (422,000) 764,000
Income taxes payable 430,000 (764,000)
Deferred compensation (43,000) (53,000)
------------ ------------
Total adjustments (1,106,000) 1,396,000
------------ ------------
Net cash provided by operating
activities $ 5,251,000 $ 6,596,000
------------ ------------
</TABLE>
(Continued)
Page 7 of 18
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<TABLE>
<CAPTION>
WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(Continued)
SIX MONTHS ENDED SEPTEMBER 30,
-----------------------------------
1996 1995
------------ ------------
<S> <C> <C>
Cash flows from investing activities:
Additions to property, plant
and equipment $ (1,534,000) $ (611,000)
Advances to aviation joint venture (288,000) --
Repayments from aviation joint venture -- 338,000
Proceeds from disposition of assets 29,000 207,000
Proceeds from notes receivable 278,000 793,000
Additional expenditures for
acquisition of business (8,000) (40,000)
------------ ------------
Net cash (used in) provided by
investing activities (1,523,000) 687,000
------------ ------------
Cash flows from financing activities:
Dividends paid on common stock (1,005,000) (1,056,000)
Repayment of long-term debt (40,000) (92,000)
Proceeds from issuance of common stock 38,000 --
------------ ------------
Net cash used in financing activities (1,007,000) (1,148,000)
------------ ------------
Net increase in cash and cash equivalents 2,721,000 6,135,000
Cash and cash equivalents at beginning
of period 12,856,000 10,907,000
------------ ------------
Cash and cash equivalents, at end
of period $ 15,577,000 $ 17,042,000
============ ============
</TABLE>
(Continued)
Page 8 of 18
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WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(Continued)
SIX MONTHS ENDED SEPTEMBER 30,
-----------------------------------
1996 1995
------------ ------------
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION:
Cash paid during the period for:
Interest $ 50,000 $ 38,000
============ ============
Income taxes $ 2,343,000 $ 3,276,000
============ ============
SUPPLEMENTAL SCHEDULE OF NONCASH ACTIVITIES:
As partial consideration for the sale of certain assets on June 1,
1995, the Company received a $979,000 note receivable, with an original maturity
date of July 1, 2007. In October 1995, the entire outstanding principal balance
was collected in cash, net of a $98,000 pre-payment discount.
Cash dividends declared, but not yet paid, totaling $603,000 and $396,000,
are included in accounts payable and accrued expenses as of September 30, 1996
and 1995, respectively.
Page 9 of 18
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
THE SIX MONTHS ENDED SEPTEMBER 30, 1996 COMPARED TO THE SIX MONTHS ENDED
SEPTEMBER 30, 1995
The Company's revenue for the six months ended September 30, 1996 was
$351,043,000, an increase of $66,425,000 or 23.3%, as compared to revenue of
$284,618,000 for the corresponding period of the prior year. The Company's
revenue during these periods was attributable to the following segments:
SIX MONTHS ENDED SEPTEMBER 30,
1996 1995
------------- ------------
Aviation Fueling $ 178,485,000 $ 136,398,000
Marine Fueling 160,922,000 139,936,000
Oil Recycling 11,636,000 8,284,000
------------- -------------
Total Revenue $ 351,043,000 $ 284,618,000
============= =============
The aviation fueling segment contributed $178,485,000 in revenue for the
six months ended September 30, 1996. This represented increase in revenue of
$42,087,000, or 30.9%, as compared to the same period of the prior year. The
increase in revenue was due to an increase in volume and the average price per
gallon sold. The marine fueling segment contributed $160,922,000 in revenue for
the six months ended September 30, 1996, an increase of $20,986,000, or 15.0%,
over the corresponding period of the prior year. The increase in revenue was
related primarily to increases in volume traded and the average price per metric
ton, partially offset by a decrease in the volume brokered. The oil recycling
segment contributed $11,636,000 in revenue for the six months ended September
30, 1996, an increase of $3,352,000, or 40,5%, as compared to the same period of
the prior year. The increase in revenue was due to an increase in volume and the
average sales price per gallon of recycled oil sold, and higher used oil and
waste water collection revenue.
The Company's gross profit of $23,258,000 for the six months ended
September 30, 1996, increased $4,173,000, or 21.9%, as compared to the same
period of the prior year. The Company's gross margin decreased slightly from
6.7% for the six months ended September 30, 1995, to 6.6% for the six months
ended September 30, 1996.
The Company's aviation fueling business achieved a 6.6% gross margin for
the six months ended September 30, 1996, as compared to 7.5% achieved for the
same period during the prior year. The decrease resulted from an increase in the
average sales price per gallon sold,
Page 10 of 18
<PAGE>
despite a slight increase in the average gross profit per gallon. The Company's
marine fueling segment achieved a 4.6% gross margin for the six months ended
September 30, 1996, as compared to a 4.4% gross margin for the same period of
the prior year. The increase resulted from a higher gross profit per metric ton,
in both trading and brokering activities, despite a modest increase in the
average sales price per metric ton. The gross margin in the Company's oil
recycling segment increased from 32.7% for the six months ended September 30,
1995, to 34.7% for the six months ended September 30, 1996. The increase
resulted from a higher gross profit per gallon of recycled oil sold.
Total operating expenses for the six months ended September 30, 1996 were
$14,991,000, an increase of $3,312,000, or 28.4%, as compared to the same
period of the prior year. The increase resulted primarily from a higher
provision for bad debts in the aviation fueling segment, which increased
$1,547,000 over the corresponding period during the prior year, as well as
higher salaries related to performance based employment contracts, higher legal
and professional fees, and the expenses associated with the newly established
Costa Rican operations. In relation to revenue, total operating expenses
increased from 4.1% to 4.3%.
The Company's income from operations for the six months ended September
30, 1996 was $8,267,000, an increase of $861,000, or 11.6%, as compared to the
same period of the prior year. Income from operations during these periods was
attributable to the following segments:
SIX MONTHS ENDED SEPTEMBER 30,
1996 1995
---------- -------------
Aviation Fueling $ 5,709,000 $ 6,978,000
Marine Fueling 2,212,000 1,453,000
Oil Recycling 2,807,000 1,472,000
Corporate Overhead (2,461,000) (2,497,000)
----------- -----------
Total Income from
Operations $ 8,267,000 $ 7,406,000
=========== ===========
The aviation fueling segment's income from operations was $5,709,000 for
the six months ended September 30, 1996, a decrease of $1,269,000, or 18.2%, as
compared to the six months ended September 30, 1995. This resulted from an
increase in operating expenses, principally in the provision for bad debts,
partially offset by an increase in the volume of product sold. The Company's
aviation fueling segment also earned $880,000 from its joint venture during the
six months ended September 30, 1996, as compared to $856,000 during the same
period of the prior year. The results of the joint venture are shown in other
income. The marine fueling segment earned $2,212,000 in income from operations
for the six months ended September 30, 1996, an increase of
Page 11 of 18
<PAGE>
$759,000, or 52.2% over the corresponding period of the prior year. This
increase was related primarily to an increase in the average gross profit per
metric ton, partially offset by a decrease in the volume of metric tons brokered
and higher operating expenses. Income from operations of the oil recycling
segment increased by $1,335,000, or 90.7%, for the six months ended September
30, 1996, as compared to the same period of the prior year. This improvement
resulted from an increase in volume and the average gross profit per recycled
oil gallon sold.
Corporate overhead costs not charged to the business segments totaled
$2,461,000 for the six months ended September 30, 1996, a decrease of $36,000,
or 1.4%, as compared to the same period of the prior year. In relation to
revenue, total corporate overhead decreased to 0.7% for the six months ended
September 30, 1996, as compared to 0.9% for the same period of the prior year.
The Company's effective income tax rate for the six months ended
September 30, 1996 was 32.0%, as compared to 36.8% for the same period of the
prior year. The decrease is the result of an overall decline in foreign income
taxes.
Net income for the six months ended September 30, 1996 was $6,357,000, an
increase of $l,l57,000, or 22.3%, as compared to net income for the six months
ended September 30, 1995. Earnings per share of $0.78 for the six months ended
September 30, 1996 exhibited a $0.13, or 20.0% increase over the $0.65 achieved
during the same period of the prior year.
THE THREE MONTHS ENDED SEPTEMBER 30, 1996 COMPARED TO THE THREE MONTHS ENDED
SEPTEMBER 30, 1995
The Company's revenue for the three months ended September 30, 1996 was
$180,349,000, an increase of $34,691,000, or 23.8%, as compared to revenue of
$145,658,000 of the corresponding period of the prior year. The Company's
revenue during these periods was attributable to the following segments:
THREE MONTHS ENDED SEPTEMBER 30,
1996 1995
-------------- -------------
Aviation Fueling $ 90,50l,000 $ 73,539,000
Marine Fueling 83,790,000 67,849,000
Oil Recycling 6,058,000 4,270,000
------------- ------------
Total Revenue $ 180,349,000 $145,658,000
============= ============
Page 12 of 18
<PAGE>
The aviation fueling segment contributed $90,501,000 in revenue for the three
months ended September 30, 1996. This represented an increase in revenue of
$16,962,000, or 23.1%, as compared to the same period of the prior year. The
increase in revenue was due to an increase in volume and the average price per
gallon sold. The marine fueling segment contributed $83,790,000 in revenue for
the three months ended September 30, 1996, an increase of $15,941,000, or 23,5%,
over the corresponding period of the prior year. The increase in revenue was
related to increases in volume traded and the average price per metric ton,
partially offset by a decrease in volume brokered. The oil recycling segment
contributed $6,058,000 in revenue for the three months ended September 30, 1996,
an increase of $1,788,000, or 41.9%, as compared to the same period of the prior
year. The increase in revenue was due to an increase in volume and the average
sales price per gallon of recycled oil sold, and higher used oil and waste water
collection revenue.
The Company's gross profit of $11,626,000 for the three months ended
September 30, 1996, increased $1,715,000, or 17.3%, as compared to the same
period of the prior year. The Company's gross margin decreased from 6.8% for
the three months ended September 30, 1995, to 6.4% for the three months ended
September 30, 1996.
The Company's aviation fueling business achieved a 6.4% gross margin for
the three months ended September 30, 1996, as compared to 7.3% achieved for the
same period during the prior year. This resulted from an increase in the
average sales price per gallon, despite a slight increase in the average gross
profit per gallon. The Company's marine fueling segment achieved a 4.5% gross
margin for the three months ended September 30, 1996, as compared to a 4.6%
gross margin for the same period of the prior year. This resulted from an
increase in the average sales price per metric ton over the same period of the
prior year, despite an increase in the average gross profit per metric ton. The
gross margin in the Company's oil recycling segment increased from 33.9% for the
three months ended September 30, 1995, to 34.6%, for the three months ended
September 30, 1996. The increase in the gross margin resulted from an increase
in the gross profit per gallon of recycled oil sold.
Total operating expenses for the three months ended September 30, 1996
were $7,696,000, an increase of $1,529,000, or 24.8%, as compared to the same
period of the prior year. The increase resulted from a higher provision for bad
debts, as well as higher salaries related to performance based employment
contracts, higher legal and professional fees, and the expenses associated with
the newly established Costa Rican operations. In relation to revenue, total
operating expenses increased from 4.2% to 4.3%.
Page 13 of 18
<PAGE>
The Company's income from operations for the three months ended
September 30, 1996 was $3,930,000, an increase of $186,000, or 5.0%, as compared
to the same period of the prior year. Income from operations during these
periods was attributable to the following segments:
THREE MONTHS ENDED SEPTEMBER 30,
1996 1995
------------ ------------
Aviation Fueling $ 2,616,000 $ 3,479,000
Marine Fueling 1,194,000 775,000
Oil Recycling 1,459,000 910,000
Corporate Overhead (1,339,000) (1,420,000)
----------- -----------
Total Income from
Operations $ 3,930,000 $ 3,744,000
=========== ===========
The aviation fueling segment's income from operations was $2,616,000 for
the three months ended September 30, 1996, a decrease of $863,000, or 24.8% as
compared to the three months ended September 30, 1995. This resulted from an
increase in operating expenses, principally in the provision for bad debts,
partially offset by an increase in the volume and the average gross profit per
gallon. The Company's aviation fueling segment also earned $471,000 from its
joint venture during the three months ended September 30, 1996, as compared to
$479,OOO during the same period of the prior year. The results of the joint
venture are shown in other income. The marine fueling segment earned $1,194,000
in income from operations for the three months ended September 30, 1996, an
increase of $419,000, or 54.1% over the corresponding period of the prior year.
This increase was related primarily to an increase in the average gross profit
per metric ton, partially offset by higher operating expenses. Income from
operations of the oil recycling segment increased by $549,000, or 60.3%, for the
three months ended September 30, 1996, as compared to the same period of the
prior year. This improvement resulted from an increase in volume and the
average gross profit per recycled oil gallon sold, partially offset by an
increase in operating expenses.
Corporate overhead costs not charged to the business segments totaled
$1,339,000 for the three months ended September 30, 1996, a decrease of $81,000,
or 5.7%, as compared to the same period of the prior year. In relation to
revenue, total corporate overhead decreased to 0.7% for the three months ended
September 30, 1996, as compared to 1.0% for the same period of the prior year.
The Company's effective income tax rate for the three months ended
September 30, 1996 was 29.5%, as compared to 36.5% for the same period of the
prior year. The decrease is the result of an overall decline in foreign income
taxes.
Page 14 of 18
<PAGE>
Net income for the three months ended September 30, 1996 was $3,253,000,
an increase of $598,000, or 22.5%, as compared to net income for the three
months ended September 30, 1995. Earnings per share of $0.40 for the three
months ended September 30, 1996 exhibited a $.07, or 21.2% increase over the
$0.33 achieved during the same period of the prior year.
LIQUIDITY AND CAPITAL RESOURCES
Cash and cash equivalents amounted to $15,577,000 at September 30, 1996,
as compared to $12,856,000 at March 31, 1996. The principal sources of cash for
the first six months of fiscal year 1997 were $5,251,000 in net cash provided by
operating activities and $278,000 from collections on notes receivable.
Partially offsetting the increase in cash and cash equivalents was $1,534,000
for capital expenditures and $1,005,000 in dividends paid on common stock. Other
components of changes in cash and cash equivalents are detailed in the
Consolidated Statements of Cash Flows.
Working capital as of September 30, 1996 was $45,087,000, exhibiting a
$5,541,000 increase from working capital as of March 31, 1996. As of September
30, 1996, the Company's accounts receivable, excluding the allowance for bad
debts, amounted to $66,085,000, a decrease of $1,023,000, as compared to the
March 31, 1996 balance. In the aggregate, accounts payable, accrued expenses,
and customer deposits increased $1,185,000. The net decrease in trade credit of
$2,208,000 was primarilly attributable to the aviation segment. The allowance
for bad debts as of September 30, 1996 amounted to $4,400,000, an increase of
$37,000 compared to the March 31, 1996 balance. During the first six months of
fiscal year 1997, the Company recorded a $2,534,000 provision for bad debts and
had charge-offs in excess of recoveries of $2,496,000. The provision and
charge-offs are primarily related to the Company's aviation segment.
Prepaid and other current assets as of September 30, 1996 were
$7,663,000, exhibiting an increase of $4,604,000 over the March 31, 1996
balance. This is partially related to an increase in prepaid fuel, prepaid
insurance, and deposits collectively totaling $2,224,000. In addition, during
fiscal year 1997, accounts receivable totaling $1,218,000 were converted to
short-term notes receivable and the Company reclassified $749,000 related to its
aviation joint venture investment, which was previously classified as
noncurrent, to other current assets.
Capital expenditures, which amounted to $1,534,000 for the first six
months of fiscal year 1997, consisted primarily of $384,000 in computer and
office equipment, $451,000 in plant, machinery and equipment, and $649,000 in
construction in progress to increase the storage capacity at the Company's
Louisiana used oil facility. During the balance of fiscal year 1997, the Company
anticipates spending approximately $500,000 to upgrade plant, machinery and
equipment. The Company also anticipates spending an estimated $1,000,000 over
the next several years to clean up contamination which was present at one of the
Page 15 of 18
<PAGE>
company's sites when it was acquired by the Company. The clean up costs will be
capitalized as part of the cost of the site, up to the fair market value of the
site.
The Company's working capital requirements are not expected to vary
substantially for the balance of fiscal year 1997. The Company expects to meet
its cash requirements for the balance of fiscal year 1997 from existing cash,
operations, and additional borrowings, as necessary, under its existing credit
facility. The Company's business has not been significantly affected by
inflation during the periods discussed in this report.
Page 16 of 18
<PAGE>
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Company's annual meeting of stockholders was held on August 19,
1996.
The only matter voted on at the meeting was the election of the
Directors of the Company. All of the Company's director nominees
were elected.
ELECTION OF DIRECTORS
NAME OF DIRECTOR VOTES FOR VOTES AGAINST
---------------- --------- -------------
1. Ralph R. Weiser 6,757,364 416,977
2. Jerrold Blair 6,762,419 411,922
3. Ralph R. Feuerring 6,947,052 227,289
4. John R. Benbow 6,981,919 192,422
5. Phillip S. Bradley 6,948,303 226,038
6. Celestin A. Durand, III 6,981,469 192,872
7. Myles Klein 6,951,798 222,543
8. Michael J. Kasbar 6,982,919 191,422
9. Paul H. Stebbins 6,982,919 191,422
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) During the three months ended September 30, 1996, the Company
did not file any reports on Form 8-K.
(b) 27 Financial Data Schedule (for SEC use only).
Page 17 of 18
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
DATE: November 1, 1996 WORLD FUEL SERVICES CORPORTION
/s/ JERROLD BLAIR
-----------------
Jerrold Blair
President
/s/ CARLOS A. ABAUNZA
---------------------
Carlos A. Asaunza
Chief Financial Officer
Page 18 of 18
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S SEPTEMBER 30, 1996 UNAUDITED FINANCIAL STATEMENTS FILED ON
FORM 10-Q AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-END> SEP-30-1996
<CASH> 15,577,000
<SECURITIES> 0
<RECEIVABLES> 66,085,000
<ALLOWANCES> 4,400,000
<INVENTORY> 5,051,000
<CURRENT-ASSETS> 89,976,000
<PP&E> 21,784,000
<DEPRECIATION> 6,408,000
<TOTAL-ASSETS> 118,525,000
<CURRENT-LIABILITIES> 44,889,000
<BONDS> 0
0
0
<COMMON> 81,000
<OTHER-SE> 68,858,000
<TOTAL-LIABILITY-AND-EQUITY> 118,525,000
<SALES> 351,043,000
<TOTAL-REVENUES> 351,043,000
<CGS> 327,785,000
<TOTAL-COSTS> 327,785,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 2,534,000
<INTEREST-EXPENSE> 234,000
<INCOME-PRETAX> 9,345,000
<INCOME-TAX> 2,988,000
<INCOME-CONTINUING> 6,357,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,357,000
<EPS-PRIMARY> 0.78
<EPS-DILUTED> 0.78
</TABLE>
