Aegean: New Business Will Push 2015 Results Higher, But 2014 Volumes Like-for-Like

Aegean President E. Nikolas Tavlarios

Aegean Marine Petroleum Network Inc. [NYSE: ANW] (Aegean) said contributions from the company's recent expansions can be expected to meaningfully impact 2015 results, but higher sales volumes reported for 2014 were predominantly like-for-like increases.

"It was basically same store sales," said Aegean President E. Nikolas Tavlarios discussing the fact that Aegean exceeded 3 million tonnes in quarterly bunker sales for the first time in quarter four (Q4) of last year.

He pointed to the benefits of a lower oil price, saying it was helping the company increase sales volumes as well as reduce costs by improving vessel utilisation.

"In 2015, we will be able to deliver earnings that are meaningfully higher than our 2014 results," said Tavlarios.

Towards the end of the year, he said Aegean had "opportunistically" entered new markets following the collapse of rival OW Bunker and these businesses were ramping up from having halted completely, the contribution from which would feed into 2015 results.

In the last two months of 2014 Aegean took on OW Bunker's operations in the Gulf of Mexico, and Los Angeles and Long Beach, and in the New Year opened a physical sales office in Hamburg and a marketing office in St. Petersburg.

2015 Results to Be Meaningfully Higher

"Let's just say that, we would think that the LA business can do somewhere around 50,000 tonnes a month, we think," said Tavlarios of projected sales volumes.

"And the Gulf of Mexico is probably around 30,000 tonnes a month, and Hamburg, Germany could be somewhere in that neighborhood too, maybe a hair more, but right around there."

He also said the company's Fujairah storage facility is now on line and being used by Aegean as well as leased to external customers.

"Nearly 60% of the storage facility is now in use, of which Aegean represents roughly 25%," he said, adding that the company's aim is to reach 100 percent use by the end of 2015.

The comments were delivered on the company's earnings call to discuss 2014 performance.

In addition, Tavlarios said that tightened sulfur regulations within ECAs are having a "favourable" effect on the company's performance, while Aegean's Chairman said bunker market pricing was "more rational" since the collapse of OW Bunker.

Last week Aegean announced strong Q4 and full year results, saying 2014 was a "landmark year" for the company.