Vertex Energy, Inc.

Vertex reported Q2 2024 net loss attributable to the company of $53.8 million, versus a net loss of $81.4 million in Q2 2023. Total adjusted EBITDA was a loss of $22.4 million, hurt by lower pricing. Total capital expenditures were $15 million, 29% below prior guidance. Gross margin per barrel on the conventional business fell to $5.67 from $12.63 in Q1. For the balance sheet, cash and equivalents including restricted cash were $18.9 million at June 30, 2024, excluding the additional $20 million received in July, and net debt outstanding was $303.8 million including $67.5 million of lease obligations. For Q3, management expects Mobile conventional throughput of 55,000 to 60,000 barrels per day, conventional product yield of 64% to 68% high-value finished products, OpEx per barrel of $5.52 to $6.02, and capital expenditures of $15 million to $20 million, including part of the $10 million conversion cost.

Ben Cowart framed the quarter as one hit by a difficult macro backdrop, especially the 28% decline in crack spreads, but emphasized that the company is responding with cost reduction, capital discipline, and strategic repositioning. He said Vertex is pivoting from renewable diesel back to conventional fuels to capture better margins in a more established market, while also working with lenders to bridge near-term liquidity pressure. His tone was cautious but constructive, stressing that the team is focused on increasing cash, lowering costs, and improving margins.

Chris Carlson focused on liquidity and the balance sheet, noting the company entered into additional term loans totaling $35 million to help through the RD-to-conventional transition and weaker pricing. He said stopping renewable diesel losses and upgrading VGO into higher-margin conventional product should improve cash flow and financial flexibility. On the quarter, he cited the $53.8 million net loss, $22.4 million adjusted EBITDA loss, $15 million of capex, $18.9 million of cash and restricted cash at June 30, and $303.8 million of net debt. For Q3, he guided to lower throughput, higher per-barrel OpEx because of the turnaround, and capex of $15 million to $20 million.

This transcript did not include a live analyst Q&A section, so the main investor questions were addressed proactively by management in prepared remarks. The key issues were liquidity, the hydrocracker conversion timeline, and what the company expects from the conventional pivot. Management answered by pointing to additional lending capacity, modified loan terms, an on-stream target for the hydrocracker of Q4 2024, and a return to typical run rates in Q4 after the planned turnaround.