Vertex Energy COO to retire, successor named

HOUSTON - Vertex Energy, Inc. (NASDAQ:VTNR), a specialty refiner of high-quality refined products, today announced the upcoming retirement of Chief Operating Officer James Rhame, effective July 25, 2024. Following his retirement, Rhame will transition to a consulting role through the end of the year. Doug Haugh, currently the Chief Commercial Officer at Vertex (NASDAQ:VRTX), will take over as interim COO.

James Rhame joined Vertex in 2022 to facilitate the acquisition and integration of the Mobile, Alabama refinery. During his tenure, he has been credited with developing the expertise necessary to safely incorporate the refinery into Vertex's operations. "James has played a pivotal role in developing the talent and expertise to safely and effectively embed the Mobile, Alabama refinery into Vertex's asset footprint," said Benjamin P. Cowart, President and CEO of Vertex.

Doug Haugh, who will succeed Rhame, has a background in leading commercial and operational functions. He expressed his commitment to continuing the standards set by Rhame, focusing on safety and operational excellence. "James's commitments to safety and operational excellence have set an incredible example for all of us at Vertex and I am honored to continue his work advancing Vertex toward its strategic initiatives," Haugh remarked.

Vertex Energy positions itself as an energy transition company, aiming to produce refined products while emphasizing sustainability and operational excellence. The company's strategic initiatives appear to be geared towards maintaining its role as a reliable producer on the Gulf Coast.

This leadership change comes as part of a planned transition, ensuring continuity in Vertex's operations. The information regarding this announcement is based on a press release statement from Vertex Energy, Inc.

In other recent news, Houston-based Vertex Energy Inc . has made notable amendments to its financial and intercreditor agreements, according to a recent SEC filing. The company's wholly-owned subsidiary, Vertex Refining Alabama LLC, and its subsidiary guarantors entered into a revised intercreditor agreement with Macquarie Energy North America Trading Inc. and Cantor Fitzgerald Securities.

This amendment removed references to the RD Supply and Offtake Agreement Documents, which may influence the company's ability to modify existing financial agreements and impose certain restrictions during insolvency procedures.

Vertex Energy's shareholders have elected directors and ratified auditors for the upcoming fiscal year. This follows the company's strategic shift from renewable diesel production to conventional fuel production, a move expected to contribute an additional $40 million in fuel gross margin. Additionally, Vertex Energy secured a new off-take agreement for jet fuel, projected to enhance profitability by $10 million. The company reported an adjusted EBITDA of nearly $20 million in the first quarter of 2024.

In line with these developments, a Stifel analyst lowered the price target for Vertex Energy's shares from $4.00 to $1.50. The analyst maintained a Hold rating on the stock, anticipating that the fuel gross margin will dip in the second quarter of 2024 but will gradually increase in the second half of the year. These recent developments reflect Vertex Energy's response to market conditions and its strategic focus on conventional refinery operations.

InvestingPro Insights

As Vertex Energy, Inc. (NASDAQ:VTNR) navigates a leadership transition with the retirement of its Chief Operating Officer, James Rhame, and the appointment of Doug Haugh as interim COO, the company is also grappling with several financial challenges. According to InvestingPro Tips, Vertex Energy operates with a significant debt burden and has been quickly burning through cash. Analysts have noted that the company suffers from weak gross profit margins and does not pay dividends to shareholders, which could be points of concern for potential investors.

InvestingPro Data paints a picture of the financial state of Vertex Energy. With a market capitalization of around $93.61 million USD and a negative P/E ratio of -0.63, the company's financial performance reflects some of the operational difficulties it faces. The revenue for the last twelve months as of Q1 2024 is reported at $3,181.37 million USD, with a gross profit of $142.69 million USD, resulting in a gross profit margin of 4.49%. These figures indicate that while the company is generating revenue, it is not translating into high profitability.

Despite these challenges, there are some positive signs. Two analysts have revised their earnings upwards for the upcoming period, which could suggest that there may be potential for improvement. Additionally, the company has experienced a significant return over the last week, with a 47.95% price total return. This could indicate a short-term boost in investor confidence or a market reaction to recent events within the company.

For those looking to delve deeper into Vertex Energy's financials and future outlook, InvestingPro offers additional tips and insights. By using the coupon code PRONEWS24, readers can get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, providing access to valuable investment information and analysis. There are 11 additional InvestingPro Tips available for Vertex Energy, which could further inform investment decisions and provide a more comprehensive understanding of the company's financial health and prospects.

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