SEGMENT REPORTING

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

SEGMENT REPORTING

SEGMENT REPORTING

The Refining and Marketing segment consists primarily of the sale of gasoline, diesel and jet fuel produced at the Mobile Refinery as well as pygas and industrial fuels, which are produced at a third-party facility. During the second quarter of 2023, the Mobile Refinery began processing soybean oil into renewable diesel.

The Black Oil and Recovery segment consists primarily of the sale of (a) petroleum products which include base oil and industrial fuels—which consist of used motor oils, cutterstock and fuel oil generated by our facilities; (b) oil collection services—which consist of used oil sales, burner fuel sales, antifreeze sales and service charges; (c) the sale of other re-refinery products including asphalt, condensate, recovered products, and used motor oil; (d) transportation revenues; (e) the sale of VGO/marine fuel; (f) the sale of ferrous and non-ferrous recyclable metal products that are recovered from manufacturing and consumption; and (g) revenues generated from trading/marketing of Group III Base Oils. The Black Oil and Recovery segment excludes all property and assets owned by Vertex OH, including inventory associated with the Heartland Refinery, and all real and leased property and permits owned by Vertex OH, and all used motor oil collection and recycling assets and operations owned by Vertex OH (collectively with the Heartland Refinery, the “Heartland Assets and Operations”), which are presented herein as discontinued operations.

We also disaggregate our revenue by product category for each of our segments, as we believe such disaggregation helps depict how our revenue and cash flows are affected by economic factors.

Segment information for the three months ended March 31, 2024 and 2023 is as follows (in thousands):

THREE MONTHS ENDED MARCH 31, 2024
	Refining & Marketing		Black Oil & Recovery		Corporate and Eliminations		Total
Revenues:
Refined products	$	650,759	$	31,724	$	(1,022)	$	681,461
Re-refined products	3,867		5,215		—		9,082
Services	3,081		1,702		—		4,783
Total revenues	657,707		38,641		(1,022)		695,326
Cost of revenues (exclusive of depreciation and amortization shown separately below)	622,974		30,082		(1,022)		652,034
Depreciation and amortization attributable to costs of revenues	6,541		1,645		—		8,186
Gross profit	28,192		6,914		—		35,106
Selling, general and administrative expenses	26,147		5,397		8,238		39,782
Depreciation and amortization attributable to operating expenses	793		72		239		1,104
Income (loss) from operations	1,252		1,445		(8,477)		(5,780)
Other income (expenses)
Other expense	(685)		(359)		(5)		(1,049)
Gain on change in derivative liability	—		—		6,658		6,658
Interest expense	(4,747)		(96)		(12,840)		(17,683)
Total other expense	(5,432)		(455)		(6,187)		(12,074)
Income (loss) from continuing operations before income tax	$	(4,180)	$	990	$	(14,664)	$	(17,854)
Capital expenditures	$	11,299	$	3,427	$	—	$	14,726

THREE MONTHS ENDED MARCH 31, 2023
	Refining & Marketing		Black Oil & Recovery		Corporate and Eliminations		Total
Revenues:
Refined products	$	653,042	$	29,423	$	(2,733)	$	679,732
Re-refined products	4,353		4,411		—		8,764
Services	1,933		713		—		2,646
Total revenues	659,328		34,547		(2,733)		691,142
Cost of revenues (exclusive of depreciation and amortization shown separately below)	589,812		30,418		(878)		619,352
Depreciation and amortization attributable to costs of revenues	3,294		1,043		—		4,337
Gross profit	66,222		3,086		(1,855)		67,453
Selling, general and administrative expenses	26,486		4,799		10,657		41,942
Depreciation and amortization attributable to operating expenses	808		38		170		1,016
Income (loss) from operations	38,928		(1,751)		(12,682)		24,495
Other income (expenses)
Other income (expense)	—		1,655		(2)		1,653
Loss on change in derivative liability	—		—		(9,185)		(9,185)
Interest expense	(3,876)		(57)		(8,544)		(12,477)
Total other income (expense)	(3,876)		1,598		(17,731)		(20,009)
Income (loss) from continuing operations before income tax	$	35,052	$	(153)	$	(30,413)	$	4,486
Capital expenditures	$	69,908	$	4,028	$	—	$	73,936

Total assets by segment were as follows (in thousands):

As of March 31, 2024
	Refining & Marketing		Black Oil & Recovery		Corporate and Eliminations		Consolidated
Total assets	$	655,271	$	110,131	$	69,651	$	835,053
As of December 31, 2023
	Refining & Marketing		Black Oil & Recovery		Corporate and Eliminations		Consolidated
Total assets	$	661,101	$	106,524	$	86,999	$	854,624

Segment assets for the Refining and Marketing and Black Oil and Recovery segments consist of property, plant, and equipment, right-of-use assets, intangible assets, accounts receivable, inventories and other assets. Assets for the corporate unallocated amounts consist of property, plant, and equipment used at the corporate headquarters, intangible assets, derivative commodity assets and cash.