Aegean Expecting to Report a Net Loss for Third Quarter 2017

Tuesday November 7, 2017

Aegean Marine Petroleum Network Inc. [NYSE: ANW] (Aegean) today said it expects to report a net loss for the third quarter of 2017 of between $3.4 and $4.4 million, or a loss of $0.09 and $0.11 per share.

The global bunker player, who plans to release its results on Wednesday, November 15, 2017, reported a GAAP net income of $10.6 million for the period in 2016.

The announcement follows a 1Q 2017 result that saw net income fall 88.1% to $1.4 million, and in 2Q 2017 a drop in net income of 87.4% year-on-year to $1.7 million.

Since the surprise 1Q 2017 result, the world's largest independent physical bunker supplier has undergone a management shakeup that includes the appointment of Jonathan Mcilroy as President of Aegean, and has pledged to reduce its global operating expenses by $20 million,

Today, Aegean said it continues to make significant progress on its cost savings initiatives, but "the challenging operating environment that dominated the first half of 2017 has continued to put pressure on sales margins, depressing the Company's gross profit and inhibiting its ability to offset the cost of its operations."

Jonathan McIlroy, Aegean's President, commented: "The third quarter of 2017 has seen a continuation of the challenging market trends that our Company and our competitors have faced throughout this year. In addition, a combination of three hurricanes and one serious refinery fire compounded what was already a tough environment in the third quarter. Despite modest improvement in some segments of the shipping industry, the oil markets and the marine fuel sector remain under great pressure.

"We continue to see margin deterioration in many of our key markets resulting from lackluster demand and increased competition. This was a deciding factor in our recent decision to withdraw from the physical supply business in the Singapore market. We as a company are committed to offsetting market weakness by being proactive where we can. Through cost savings initiatives and seeking growth opportunities in higher margin markets, these actions should improve the profitability of our business over time. Our recent changes in Singapore are illustrative of this commitment to our shareholders.

"Despite our expected third quarter loss, we have taken cumulative measures through October 2017 that are aimed to yield more than $20 million in annualized cost savings. These measures include downsizing our U.S. West Coast storage footprint, our recently announced withdrawal as a physical supplier in Singapore as well as other fleet savings through the deactivation of unproductive tonnage. Even after these savings are accounted for, we believe there remains further opportunity to cut costs across our network. We expect to discuss the market and these cost savings in more detail when we announce full third quarter results."

Aegean will hold a conference call during which it will discuss third quarter results in more detail on Thursday, November 16, 2017, at 8:30 A.M. Eastern Time.