Arabian American Development Company (ARSD, Financial) filed Quarterly Report for the period ended 2009-06-30.
ARABIAN AMER\'s principal business activities include refining petrochemical products and developing mineral properties in Saudi Arabia and the United States. All of its mineral properties are presently undeveloped and require capital expenditures before beginning any commercial operations. Their undeveloped mineral interests are primarily located in Saudi Arabia. Arabian American Development Company has a market cap of $78 million; its shares were traded at around $3.33 with and P/S ratio of 0.4.
Cash used for investing activities during the first half of 2009 was approximately $1,711,000, representing a decrease of approximately $6,860,000 over the corresponding period of 2008. The Company made a conscious decision in the first half of 2009 to limit cash used for capital purchases. During the first half of 2008 approximately $6.1 million was spent for additions to Property, Pipeline and Equipment related to the Penhex Expansion project with another $0.6 million being expended for the construction of additional office space.
Cash used in financing activities during the first half of 2009 was approximately $4,735,000 versus cash provided by financing activities of approximately $10,885,000 during the corresponding period of 2008. The Company made principal payments on long-term debt during the first six months of 2009 of $4,000,000 on the Company s line of credit and $750,000 on the term loan. In 2008 additions to long term debt of $10.9 million were from a $5.9 million draw on the line of credit and a $5.0 million draw on the term loan.
SPECIALTY PETROCHEMICALS SEGMENT. In the quarter ended June 30, 2009, total petrochemical product sales decreased by about $7,075,000, transloading sales decreased by $6,839,000, and toll processing fees decreased by $111,000 for a net decrease in revenue of $14,025,000 or 32.9% over the same quarter of 2008. Sales volume of petrochemical products for the second quarter of 2009 versus 2008 increased approximately 11.7%; however, sales volume from the transloading venture decreased by approximately 31.1%. During the second quarter of 2009, the cost of petrochemical sales and processing (including depreciation) decreased approximately $13.6 million or 38.0% as compared to the same period in 2008. Consequently, total gross profit margin on revenue for the second quarter of 2009 decreased approximately $0.4 million or 6.1% as compared to the same period in 2008. The slight decrease in gross profit margin for the period was due to increases in the price of feedstock during the last month of the quarter.
For the six month period ending June 30, 2009, total petrochemical product sales, transloading sales and processing fees decreased approximately $17.9 million or 24.2%, and the cost of petrochemical sales and processing, including depreciation, decreased approximately $21.5 million or 34.7% for the same period in 2008. Consequently, the total gross profit margin on petrochemical product sales, transloading sales and processing during the first six months of 2009 increased approximately $3.7 million as compared to the same period in 2008. The cost of petrochemical product sales and processing and gross profit margin for the six month period ended June 30, 2009, includes an estimated unrealized gain of approximately $6,965,000 a realized loss of $5,856,000 for a net gain effect of approximately $1,109,000. The cost of
General and Administrative costs for the first half of 2009 decreased approximately $522,000 as compared to the same period in 2008. This decrease is primarily attributable to approximately $579,000 less expense related to the post-retirement benefits, directors fees, and officer compensation, an increase of $94,000 related to Saudi expenses, and a decrease of approximately $29,000 in insurance costs.
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ARABIAN AMER\'s principal business activities include refining petrochemical products and developing mineral properties in Saudi Arabia and the United States. All of its mineral properties are presently undeveloped and require capital expenditures before beginning any commercial operations. Their undeveloped mineral interests are primarily located in Saudi Arabia. Arabian American Development Company has a market cap of $78 million; its shares were traded at around $3.33 with and P/S ratio of 0.4.
Highlight of Business Operations:
The Company s net income during the first half of 2009 increased by approximately $2,149,000 or 46.8% in 2009 as compared to the corresponding period of 2008. Major non-cash items affecting income included an increase in depreciation of approximately $696,000, an increase in the unrealized gain on derivative instruments of approximately $2,349,000, a decrease in share-based compensation of about $229,000, an increase in deferred income taxes of roughly $3,452,000 and a decrease in post retirement obligations of about $171,000.Cash used for investing activities during the first half of 2009 was approximately $1,711,000, representing a decrease of approximately $6,860,000 over the corresponding period of 2008. The Company made a conscious decision in the first half of 2009 to limit cash used for capital purchases. During the first half of 2008 approximately $6.1 million was spent for additions to Property, Pipeline and Equipment related to the Penhex Expansion project with another $0.6 million being expended for the construction of additional office space.
Cash used in financing activities during the first half of 2009 was approximately $4,735,000 versus cash provided by financing activities of approximately $10,885,000 during the corresponding period of 2008. The Company made principal payments on long-term debt during the first six months of 2009 of $4,000,000 on the Company s line of credit and $750,000 on the term loan. In 2008 additions to long term debt of $10.9 million were from a $5.9 million draw on the line of credit and a $5.0 million draw on the term loan.
SPECIALTY PETROCHEMICALS SEGMENT. In the quarter ended June 30, 2009, total petrochemical product sales decreased by about $7,075,000, transloading sales decreased by $6,839,000, and toll processing fees decreased by $111,000 for a net decrease in revenue of $14,025,000 or 32.9% over the same quarter of 2008. Sales volume of petrochemical products for the second quarter of 2009 versus 2008 increased approximately 11.7%; however, sales volume from the transloading venture decreased by approximately 31.1%. During the second quarter of 2009, the cost of petrochemical sales and processing (including depreciation) decreased approximately $13.6 million or 38.0% as compared to the same period in 2008. Consequently, total gross profit margin on revenue for the second quarter of 2009 decreased approximately $0.4 million or 6.1% as compared to the same period in 2008. The slight decrease in gross profit margin for the period was due to increases in the price of feedstock during the last month of the quarter.
For the six month period ending June 30, 2009, total petrochemical product sales, transloading sales and processing fees decreased approximately $17.9 million or 24.2%, and the cost of petrochemical sales and processing, including depreciation, decreased approximately $21.5 million or 34.7% for the same period in 2008. Consequently, the total gross profit margin on petrochemical product sales, transloading sales and processing during the first six months of 2009 increased approximately $3.7 million as compared to the same period in 2008. The cost of petrochemical product sales and processing and gross profit margin for the six month period ended June 30, 2009, includes an estimated unrealized gain of approximately $6,965,000 a realized loss of $5,856,000 for a net gain effect of approximately $1,109,000. The cost of
General and Administrative costs for the first half of 2009 decreased approximately $522,000 as compared to the same period in 2008. This decrease is primarily attributable to approximately $579,000 less expense related to the post-retirement benefits, directors fees, and officer compensation, an increase of $94,000 related to Saudi expenses, and a decrease of approximately $29,000 in insurance costs.
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