Vertex Energy, Inc. (NASDAQ:VTNR) Q3 2022 Results Conference Call November 8, 2022 8:00 AM ET

Company Participants

John Ragozzino - IR

Ben Cowart - Chairman and CEO

Chris Carlson - Chief Financial Officer

James Rhame - Chief Operating Officer

Alvaro Ruiz - Chief Strategy Officer

Bart Rice - Vice President

John Strickland - Vice President of Black Oil Operations

Conference Call Participants

Eric Stine - Craig-Hallum

Amit Dayal - H.C. Wainwright

Noah Kaye - Oppenheimer

Brian Butler - Stifel

Operator

Good morning or good afternoon, and welcome to the Vertex Energy Third Quarter Earnings Conference Call. [Operator Instructions].

I would now like to turn the conference over to John Ragozzino. Please go ahead.

John Ragozzino

Thank you, operator. Good morning, and welcome to Vertex Energy's Third Quarter 2022 Results Conference Call. Leading the call today are Chairman and CEO, Ben Cowart; Chief Financial Officer, Chris Carlson; and Chief Operating Officer, James Rhame. Also attending the call are Chief Strategy Officer; Alvaro Ruiz; Vice President, Bart Rice; and Vice President of Black Oil Operations, John Strickland. I want to remind you that management's commentary and responses to questions on today's call may include forward-looking statements, which, by their nature, are uncertain and outside of the company's control.

Although these forward-looking statements are based on management's current expectations and beliefs, actual results may differ materially. For a discussion of some of the risk factors that could cause actual results to differ, please refer to the Risk Factors section of Vertex Energy's latest annual and quarterly filings with the SEC. Additionally, please note that you can find reconciliations of the historical non-GAAP financial measures discussed during our call in the press release issued today. Today's call will begin with remarks from Ben Cowart, followed by an operational review from James Rhame and financial review from Chris Carlson. At the conclusion of these prepared remarks, we will open the line for questions.

With that, I'll turn the call over to Ben.

Ben Cowart

Thank you, John, and good morning to those joining us on the call today. This morning, we issued a press release detailing our financial and operating results for the third quarter 2022. Simply put, we are not pleased with the full results for the quarter, largely due to previous hedges that were in place, which did not expire until September 30th. This was a slight 17% quarter-over-quarter improvement in hedge impacts, along with an additional 22% improvement on inventory charges related to backwardation. However, the impact of these items in conjunction with a few nonrecurring items resulted in consolidated adjusted EBITDA totaling $1.7 million for the quarter. which is below expectations. Chris Carlson, our Chief Financial Officer, will address financial results in greater detail momentarily.