ff20200331_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended June 30, 2021

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from __________ to ___________
	Commission file number: 0-52577

(Exact Name of Registrant as Specified in Its Charter)

Delaware		20-3340900
(State or Other Jurisdiction of		(IRS Employer Identification No.)
Incorporation or Organization)

8235 Forsyth Blvd., Suite 400, St Louis, Missouri		63105
(Address of Principal Executive Offices)		(Zip Code)

	(314) 854-8352
	(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	FF	NYSE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ☐	Accelerated filer	☑
Non-accelerated filer ☐	Smaller reporting company	☐
	Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of August 9, 2021: 43,763,243

PART I FINANCIAL INFORMATION

Item 1. Financial Statements.

FutureFuel Corp.

Consolidated Balance Sheets

(Dollars in thousands)

	(Unaudited)
	June 30, 2021			December 31, 2020
Assets
Cash and cash equivalents	$	97,594		$	198,122
Accounts receivable, inclusive of the blenders' tax credit of $12,160 and $8,300 at June 30, 2021 and December 31, 2020, respectively, and net of allowances for bad debt of $50 and $63 at June 30, 2021 and December 31, 2020, respectively		31,333			21,387
Accounts receivable – related parties		21			1,426
Inventory		53,514			33,889
Income tax receivable		16,867			17,668
Prepaid expenses		1,990			3,967
Prepaid expenses – related parties		12			-
Marketable securities		46,238			64,404
Other current assets		2,294			1,742
Total current assets		249,863			342,605
Property, plant and equipment, net		86,852			91,544
Intangible assets		-			1,408
Other noncurrent assets		5,705			5,747
Total noncurrent assets		92,557			98,699
Total Assets	$	342,420		$	441,304
Liabilities and Stockholders’ Equity
Accounts payable, inclusive of the blenders' tax credit rebates due customers of $890 and $1,116 at June 30, 2021 and December 31, 2020 respectively	$	35,578		$	12,453
Accounts payable – related parties		8,943			984
Deferred revenue – short-term		5,390			3,976
Dividends payable		5,248			10,498
Accrued expenses and other current liabilities		5,218			5,077
Total current liabilities		60,377			32,988
Deferred revenue – long-term		19,129			21,861
Noncurrent deferred income tax liability		3,451			12,332
Other noncurrent liabilities		2,049			2,240
Total noncurrent liabilities		24,629			36,433
Total liabilities		85,006			69,421
Preferred stock, $0.0001 par value, 5,000,000 shares authorized, none issued and outstanding		-			-
Common stock, $0.0001 par value, 75,000,000 shares authorized, 43,763,243 and 43,743,243 issued and outstanding at June 30, 2021 and December 31, 2020 respectively		4			4
Accumulated other comprehensive income		208			208
Additional paid in capital		282,446			282,215
Retained (deficit) earnings		(25,244	)		89,456
Total stockholders’ equity		257,414			371,883
Total Liabilities and Stockholders’ Equity	$	342,420		$	441,304

The accompanying notes are an integral part of these consolidated financial statements.

FutureFuel Corp.

Consolidated Statements of Operations and Comprehensive Income

(Dollars in thousands, except per share amounts)

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020
Revenue	$	73,813		$	47,310		$	114,971		$	99,682
Revenue – related parties		305			112			663			822
Cost of goods sold		69,760			43,469			111,138			76,250
Cost of goods sold – related parties		2,727			1,342			11,937			3,557
Distribution		1,633			1,657			3,242			3,297
Distribution – related parties		41			43			96			90
Gross (loss) profit		(43	)		911			(10,779	)		17,310
Selling, general, and administrative expenses
Compensation expense		523			724			1,051			1,579
Other expense		469			403			1,322			985
Related party expense		170			155			337			303
Research and development expenses		798			768			1,572			1,603
Total operating expenses		1,960			2,050			4,282			4,470
(Loss) income from operations		(2,003)			(1,139	)		(15,061)			12,840
Interest and dividend income		790			1,519			1,795			3,486
Interest expense		(32	)		(31	)		(64	)		(87	)
Gain (loss) on marketable securities		1,612			1,573			537			(8,486	)
Other (expense) income		(1,355)			8,348			(1,355	)		8,348
Other income		1,015			11,409			913			3,261
(Loss) income before taxes		(988	)		10,270			(14,148	)		16,101
Income tax benefit		(4,469	)		(4,889	)		(8,856	)		(18,101	)
Net income (loss)	$	3,481		$	15,159		$	(5,292	)	$	34,202

Earnings (loss) per common share
Basic	$	0.08		$	0.35		$	(0.12	)	$	0.78
Diluted	$	0.08		$	0.35		$	(0.12	)	$	0.78
Weighted average shares outstanding
Basic		43,754,232			43,743,243			43,748,768			43,743,243
Diluted		43,754,422			43,743,740			43,748,768			43,743,491

Comprehensive income (loss)
Net income (loss)	$	3,481		$	15,159		$	(5,292	)	$	34,202
Other comprehensive income (loss) from unrealized net gains (losses) on available-for-sale debt securities		60			190			-			(207	)
Income tax effect		(16	)		(40	)		-			44
Total other comprehensive income (loss), net of tax		44			150			-			(163	)
Comprehensive income (loss)	$	3,525		$	15,309		$	(5,292	)	$	34,039

The accompanying notes are an integral part of these consolidated financial statements.

FutureFuel Corp.

Consolidated Statements of Stockholders’ Equity

(Dollars in thousands)

(Unaudited)

	For the Six Months Ended June 30, 2021
					Accumulated
					Other			Additional					Total
	Common Stock				Comprehensive			Paid-in		Retained			Stockholders’
	Shares		Amount		Income (Loss)			Capital		Earnings (Deficit)			Equity
Balance - December 31, 2020		43,743,243	$	4	$	208		$	282,215	$	89,456		$	371,883
Other comprehensive loss		-		-		(60	)		-		-			(60)
Net loss		-		-		-			-		(8,773	)		(8,773	)
Balance - March 31, 2021		43,743,243	$	4	$	148		$	282,215	$	80,683		$	363,050
Cash dividends declared, $2.50 per share		-		-		-			-		(109,408	)		(109,408	)
Proceeds for the issuance of stock		20,000		-		-			231		-			231
Other comprehensive income		-		-		60			-		-			60
Net income		-		-		-			-		3,481			3,481
Balance - June 30, 2021		43,763,243	$	4	$	208		$	282,446	$	(25,244	)	$	257,414

	For the Six Months Ended June 30, 2020
					Accumulated
					Other			Additional					Total
	Common Stock				Comprehensive			Paid-in		Retained			Stockholders’
	Shares		Amount		Income (Loss)			Capital		Earnings			Equity
Balance - December 31, 2019		43,743,243	$	4	$	296		$	282,166	$	184,632		$	467,098
Prior period adjustment: change in accounting principle		-		-		-			-		(12	)		(12	)
Balance – January 1, 2020, As adjusted		43,743,243	$	4	$	296		$	282,166	$	184,620		$	467,086
Cash dividends declared, $3.00 per share		-		-		-			-		(131,230	)		(131,230	)
Stock based compensation		-		-		-			49		-			49
Other comprehensive loss		-		-		(313	)		-		-			(313	)
Net income		-		-		-			-		19,043			19,043
Balance - March 31, 2020		43,743,243	$	4	$	(17	)	$	282,215	$	72,433		$	354,635
Other comprehensive income		-		-		150			-		-			150
Net income		-		-		-			-		15,159			15,159
Balance - June 30, 2020		43,743,243	$	4	$	133		$	282,215	$	87,592		$	369,944

The accompanying notes are an integral part of these consolidated financial statements.

FutureFuel Corp.

Consolidated Statements of Cash Flows

(Dollars in thousands)

(Unaudited)

	Six Months Ended June 30,
	2021			2020
Cash flows from operating activities
Net (loss) income	$	(5,292	)	$	34,202
Adjustments to reconcile net income to net cash from operating activities:
Depreciation		5,231			5,862
Amortization of deferred financing costs		47			60
Benefit for deferred income taxes		(8,881)			699
Change in fair value of equity securities		222			7,405
Change in fair value of derivative instruments		1,136			198
(Gain) loss on the sale of investments		(758	)		1,080
Stock based compensation		-			49
Loss on disposal of property and equipment		-			2
Impairment of intangible asset		1,315			-
Noncash interest expense		16			27
Changes in operating assets and liabilities:
Accounts receivable		(9,946	)		81,029
Accounts receivable – related parties		1,405			4,290
Inventory		(19,625)			(4,610	)
Income tax receivable		801			(19,380	)
Prepaid expenses		1,977			782
Prepaid expenses – related parties		(12	)		-
Other assets		635			350
Accounts payable		23,074			(29,702	)
Accounts payable – related parties		7,959			220
Accrued expenses and other current liabilities		7			2,572
Accrued expenses and other current liabilities – related parties		-			(64	)
Deferred revenue		(1,318	)		(659	)
Other noncurrent liabilities		(342	)		(211	)
Net cash (used in) provided by operating activities		(2,349	)		84,201
Cash flows from investing activities
Collateralization of derivative instruments		(2,060	)		(2,877	)
Purchase of marketable securities		(19,170	)		(2,359	)
Proceeds from the sale of marketable securities		37,873			5,192
Proceeds from the sale of property and equipment		-			50
Proceeds from the sale of intangible asset		93			-
Capital expenditures		(488	)		(2,759	)
Net cash from (used in) investing activities		16,248			(2,753	)
Cash flows from financing activities

SEC Form 10-Q filed by FutureFuel Corp.