World Kinect(WKC) - 2022 Q1 - Quarterly Report

Part I. Financial Information Item 1. Financial Statements (Unaudited) This section presents the unaudited condensed consolidated financial statements of World Fuel Services Corporation for the quarter ended March 31, 2022, including the balance sheets, statements of income and comprehensive income, statements of shareholders' equity, and statements of cash flows, along with their accompanying notes Condensed Consolidated Balance Sheets | Metric | March 31, 2022 (Millions) | December 31, 2021 (Millions) | Change (Millions) | | :-------------------------------- | :-------------------------- | :--------------------------- | :---------------- | | Total Current Assets | $5,025.3 | $4,019.7 | +$1,005.6 | | Total Assets | $7,968.0 | $5,942.4 | +$2,025.6 | | Total Current Liabilities | $4,412.5 | $3,096.7 | +$1,315.8 | | Total Liabilities | $6,022.6 | $4,025.6 | +$1,997.0 | | Total Equity | $1,945.5 | $1,916.8 | +$28.7 | Condensed Consolidated Statements of Income and Comprehensive Income | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :---------------------------------------- | :-------------- | :-------------- | :---------------- | :------------- | | Revenue | $12,382.0 | $5,957.9 | +$6,424.1 | +107.8% | | Gross profit | $230.9 | $191.6 | +$39.3 | +20.5% | | Income from operations | $41.3 | $37.6 | +$3.7 | +9.8% | | Net income attributable to World Fuel | $26.3 | $18.9 | +$7.4 | +39.2% | | Basic earnings per common share | $0.42 | $0.30 | +$0.12 | +40.0% | | Diluted earnings per common share | $0.41 | $0.30 | +$0.11 | +36.7% | Condensed Consolidated Statements of Shareholders' Equity | Item | Amount (Millions) | | :------------------------------------ | :---------------- | | Balance as of December 31, 2021 | $1,916.8 | | Net income (loss) | $26.3 | | Cash dividends declared | $(7.6) | | Issuance of common stock for acquisition | $50.0 | | Purchases of common stock | $(13.7) | | Other comprehensive income (loss) | $(28.7) | | Balance as of March 31, 2022 | $1,945.5 | Condensed Consolidated Statements of Cash Flows | Cash Flow Activity | 2022 (Millions) | 2021 (Millions) | Change (Millions) | | :---------------------------------- | :-------------- | :-------------- | :---------------- | | Net cash provided by (used in) operating activities | $(72.0) | $103.4 | $(175.4) | | Net cash provided by (used in) investing activities | $(657.3) | $(2.7) | $(654.6) | | Net cash provided by (used in) financing activities | $343.7 | $(20.8) | +$364.5 | | Net increase (decrease) in cash and cash equivalents | $(386.0) | $76.5 | $(462.5) | | Cash and cash equivalents, end of period | $266.2 | $735.3 | $(469.1) | Notes to the Condensed Consolidated Financial Statements Note 1. Basis of Presentation, New Accounting Standards, and Significant Accounting Policies World Fuel Services Corporation is a global fuel services company distributing fuel and related products in aviation, land, and marine transportation. The company aims to become a leading global energy management company, expanding into energy advisory, sustainability, and renewable energy solutions. The financial statements are prepared under U.S. GAAP, and there have been no material changes in accounting standards or policies during the quarter - World Fuel Services Corporation is a leading global fuel services company, distributing fuel and related products and services in the aviation, land, and marine transportation industries[13] - The company intends to become a leading global energy management company, offering energy advisory, management, fulfillment services, technology solutions, payment management, and sustainability products across the energy spectrum[13] - No new accounting standards adopted in 2022 had a material impact, and no recently issued standards are expected to have a material impact[17][18] Note 2. Accounts Receivable The company manages credit exposure for accounts receivable, which totaled $3.5 billion as of March 31, 2022. The allowance for credit losses decreased, and 96% of receivables were outstanding less than 60 days. The company also utilizes receivable purchase agreements (RPAs) to sell qualifying accounts receivable | Metric | March 31, 2022 (Millions) | December 31, 2021 (Millions) | | :-------------------------------------- | :------------------------ | :--------------------------- | | Accounts receivable | $3,510.2 | $2,355.3 | | Allowance for expected credit losses | $21.0 | $29.8 | - As of March 31, 2022, 96% of accounts receivable were outstanding less than 60 days[22] | Metric | Three Months Ended March 31, 2022 (Millions) | Three Months Ended March 31, 2021 (Millions) | | :-------------------------------------- | :------------------------------------------- | :------------------------------------------- | | Aggregate face value of receivables sold | $2,600.0 | $2,000.0 | | Fees paid under RPAs | $5.5 | $4.4 | Note 3. Acquisitions World Fuel Services completed the acquisition of Flyers Energy Group, LLC on January 3, 2022, for an estimated $792.2 million, paid in cash and common stock. This acquisition is reported in the land segment and is expected to bring synergies. The company also completed another liquid fuel business acquisition in October 2021 - The acquisition of Flyers Energy Group, LLC closed on January 3, 2022, for total estimated consideration of $792.2 million, including $642.7 million in cash and $50.0 million in common stock[27] - The acquisition resulted in $387.1 million in goodwill, primarily attributable to expected synergies within the land segment[28] - Flyers contributed $752.5 million in revenue and $18.1 million in income before income taxes from the acquisition date through March 31, 2022[28] Note 4. Goodwill Goodwill increased significantly to $1,244.6 million as of March 31, 2022, primarily due to the $387.1 million goodwill recognized from the Flyers acquisition in the land segment | Segment | December 31, 2021 (Millions) | 2022 Acquisition (Millions) | Foreign Currency Translation (Millions) | March 31, 2022 (Millions) | | :--------- | :--------------------------- | :-------------------------- | :-------------------------------------- | :------------------------ | | Aviation | $400.1 | — | $(0.8) | $399.3 | | Land | $461.8 | $387.1 | $(3.5) | $845.4 | | Total | $861.9 | $387.1 | $(4.3) | $1,244.6 | Note 5. Derivative Instruments The company uses derivative instruments (fair value hedges, cash flow hedges, and non-designated derivatives) to mitigate risks from commodity price changes, foreign currency exchange rates, and interest rates. The gross notional value of commodity contracts was 55.2 million BBL long and 51.6 million BBL short as of March 31, 2022 - The company's risk management program includes fair value hedges (for inventory price risk), cash flow hedges (for price and interest rate volatility in forecasted transactions), and non-designated derivatives (for market price fluctuations and currency rate hedging)[32][33] | Contract Type | Unit | Value (Millions) | | :---------------------------- | :--- | :--------------- | | Commodity contracts (Long) | BBL | 55.2 | | Commodity contracts (Short) | BBL | (51.6) | | Foreign currency (Sell USD) | USD | (301.9) | | Foreign currency (Buy USD) | USD | 536.9 | | Interest rate swap | USD | 300.0 | | Item | 2022 (Millions) | 2021 (Millions) | | :---------------------------------------------------------------- | :-------------- | :-------------- | | Gains (losses) on fair value hedge relationships (commodity) | $(12.6) | $3.6 | | Gains (losses) on cash flow hedge relationships (commodity) | $(33.0) | $(11.7) | | Gains (losses) on cash flow hedge relationships (interest rate) | $(0.3) | $(0.2) | | Realized/unrealized gains (losses) on non-designated derivatives | $67.6 | $12.9 | Note 6. Debt, Interest Income, Expense, and Other Finance Costs The company amended its Credit Facility on April 1, 2022, increasing total borrowing capacity to $2.0 billion and extending maturity to April 1, 2027. Total debt increased to $884.2 million as of March 31, 2022, with net interest expense increasing to $14.3 million for the quarter - On April 1, 2022, the company amended its Credit Facility to increase the revolving credit facility to $1.5 billion, provide a new term loan of $500 million (total borrowing capacity of $2.0 billion), and extend maturity to April 1, 2027[44] | Debt Type | March 31, 2022 (Millions) | December 31, 2021 (Millions) | Change (Millions) | | :------------------ | :------------------------ | :--------------------------- | :---------------- | | Credit Facility | $424.8 | — | +$424.8 | | Term loans | $436.7 | $484.1 | $(47.4) | | Total debt | $884.2 | $508.7 | +$375.5 | | Long-term debt | $869.1 | $478.1 | +$391.0 | | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | | :-------------------------------------- | :-------------- | :-------------- | :---------------- | | Interest income | $2.5 | $2.3 | +$0.2 | | Interest expense and other financing costs | $(16.8) | $(11.1) | $(5.7) | | Net interest expense and other financing costs | $(14.3) | $(8.7) | $(5.6) | Note 7. Shareholders' Equity The company declared quarterly cash dividends of $0.12 per common share for both periods. Accumulated other comprehensive income (loss) significantly decreased to $(165.4) million as of March 31, 2022, primarily due to foreign currency translation adjustments and cash flow hedge losses - Quarterly cash dividends of $0.12 per common share were declared for both Q1 2022 ($7.6 million total) and Q1 2021 ($7.5 million total)[47] | Component | January 1, 2022 (Millions) | March 31, 2022 (Millions) | Change (Millions) | | :-------------------------------------- | :------------------------- | :------------------------ | :---------------- | | Foreign Currency Translation Adjustments | $(134.0) | $(143.4) | $(9.4) | | Cash Flow Hedges | $(2.7) | $(22.0) | $(19.3) | | Total Accumulated Other Comprehensive Income (Loss) | $(136.7) | $(165.4) | $(28.7) | Note 8. Fair Value Measurements The company measures certain assets and liabilities at fair value on a recurring basis, primarily commodity and foreign currency contracts. Total assets at fair value increased to $1,468.5 million and total liabilities at fair value increased to $1,406.8 million as of March 31, 2022, largely driven by commodity contracts | Item | March 31, 2022 (Millions) | December 31, 2021 (Millions) | Change (Millions) | | :---------------------------------- | :------------------------ | :--------------------------- | :---------------- | | Total assets at fair value | $1,468.5 | $788.3 | +$680.2 | | Total liabilities at fair value | $1,406.8 | $748.5 | +$658.3 | - As of March 31, 2022, one counterparty represented over 10% of the company's credit exposure to OTC derivative counterparties, totaling $81.5 million[55] Note 9. Revenue from Contracts with Customers Total revenue for the three months ended March 31, 2022, was $12.38 billion, significantly up from $5.96 billion in the prior year, with all segments (Aviation, Land, Marine) showing substantial increases across various geographic regions | Segment/Region | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :------------- | :-------------- | :-------------- | :---------------- | :------------- | | Total Revenue | $12,382.0 | $5,957.9 | $6,424.1 | 107.8% | | Aviation | $5,010.5 | $2,095.0 | $2,915.5 | 139.2% | | Land | $4,380.8 | $2,188.2 | $2,192.6 | 100.2% | | Marine | $2,990.6 | $1,674.7 | $1,315.9 | 78.6% | | North America | $6,900.8 | $3,147.4 | $3,753.4 | 119.2% | | EMEA | $2,511.3 | $1,363.9 | $1,147.4 | 84.1% | | Asia Pacific | $1,419.3 | $845.7 | $573.6 | 67.8% | | LATAM | $1,430.1 | $597.3 | $832.8 | 139.4% | Note 10. Income Taxes The income tax provision decreased to $6.4 million for Q1 2022 from $8.8 million in Q1 2021, with the effective tax rate falling to 19.5% from 31.8%. This was influenced by discrete tax benefits and changes in tax jurisdictions. The company is also involved in ongoing tax examinations in Denmark, South Korea, and the U.S., with potential material impacts | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | | :------------------------ | :-------------- | :-------------- | :---------------- | | Income tax provision | $6.4 | $8.8 | $(2.4) | | Effective income tax rate | 19.5% | 31.8% | -12.3 pp | - The Q1 2022 income tax provision includes a net discrete income tax benefit of $1.2 million, comprising a $4.1 million benefit for uncertain tax position remeasurement, partially offset by $2.0 million for state apportionment/NOL changes and $0.8 million for other worldwide adjustments[59] - The company faces ongoing tax examinations in Denmark (proposed assessments of ~$57.3 million for 2015-2017, vigorously defending), South Korea (agreed to settlement reducing assessment to ~$1.6 million for 2011-2014), and the U.S. (2019 examination ongoing, 2017-2018 assessments accepted with no material impact)[61][62][63] Note 11. Business Segments The company operates in three segments: aviation, land, and marine. All segments saw significant revenue growth in Q1 2022, with land and marine segments driving the increase in income from operations, while aviation income declined due to inventory losses and reduced government activity | Segment | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :-------------- | :-------------- | :-------------- | :---------------- | :------------- | | Aviation segment | $5,010.5 | $2,095.0 | +$2,915.5 | +139.2% | | Land segment | $4,380.8 | $2,188.2 | +$2,192.6 | +100.2% | | Marine segment | $2,990.6 | $1,674.7 | +$1,315.9 | +78.6% | | Total revenue | $12,382.0 | $5,957.9 | +$6,424.1 | +107.8% | | Segment | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :-------------- | :-------------- | :-------------- | :---------------- | :------------- | | Aviation segment | $7.5 | $23.0 | $(15.5) | -67.4% | | Land segment | $33.4 | $32.8 | +$0.6 | +1.8% | | Marine segment | $23.1 | $6.4 | +$16.7 | +260.9% | | Total income from operations | $41.3 | $37.6 | +$3.7 | +9.8% | | Segment | March 31, 2022 (Millions) | December 31, 2021 (Millions) | Change (Millions) | | :-------------- | :------------------------ | :--------------------------- | :---------------- | | Aviation segment | $2,719.5 | $2,305.6 | +$413.9 | | Land segment | $3,516.1 | $2,106.1 | +$1,410.0 | | Marine segment | $1,403.7 | $1,022.7 | +$381.0 | | Total assets | $7,968.0 | $5,942.4 | +$2,025.6 | Note 12. Earnings Per Common Share Basic earnings per common share increased to $0.42 for Q1 2022 from $0.30 in Q1 2021, and diluted EPS also rose to $0.41 from $0.30, reflecting higher net income attributable to World Fuel | Metric | 2022 | 2021 | Change | YoY Change (%) | | :-------------------------------------- | :------ | :------ | :------ | :------------- | | Net income attributable to World Fuel (Millions) | $26.3 | $18.9 | +$7.4 | +39.2% | | Basic earnings per common share | $0.42 | $0.30 | +$0.12 | +40.0% | | Diluted earnings per common share | $0.41 | $0.30 | +$0.11 | +36.7% | Note 13. Commitments and Contingencies The company is involved in various legal and tax proceedings, including a $33 million judgment in Singapore (appealed) and tax disputes in South Korea and Brazil. While current loss provisions are not material, an unfavorable resolution of these matters could materially impact financial statements - A judgment of approximately $33 million was entered against one of the company's subsidiaries in the Singapore High Court, which the company is appealing[69] - The company is appealing tax assessments in South Korea totaling approximately $28.2 million (KRW 34.3 billion) for alleged VAT invoice failures (2011-2014)[70] - A Brazilian subsidiary is appealing an assessment of approximately $12.6 million (BRL 59.6 million) related to ICMS tax rates[71] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on the company's financial performance and condition for the three months ended March 31, 2022, discussing significant changes in revenue, gross profit, operating expenses, and segment-specific results, as well as liquidity and capital resources. It also includes forward-looking statements and critical accounting estimates Forward-Looking Statements - The report contains forward-looking statements regarding future results, performance, or achievements, which are qualified by cautionary statements and risk factor disclosures[75] - Key risk factors include customer and counterparty creditworthiness, adverse industry conditions, sudden changes in fuel prices, acquisition integration challenges, inability to mitigate financial risks, non-compliance with debt covenants, cyber incidents, geopolitical changes (e.g., Eastern Europe conflict), and environmental regulations[77][78] - Forward-looking statements are estimates and projections, and actual results may differ materially due to various unpredictable risks; the company disclaims any obligation to publicly update these statements unless required by law[76][79] Business Overview - World Fuel Services is a leading global fuel services company, distributing fuel and related products and services in the aviation, land, and marine transportation industries[81] - The company is expanding its offerings to include energy advisory, sustainability, renewable energy solutions, and supply fulfillment for natural gas and power, aiming to become a global energy management company[81] - The COVID-19 pandemic significantly impacted transportation industries, though travel and economic activity are improving, some regions still face restrictions[82] Reportable Segments - Aviation segment benefited from growth in fuel and services, improving logistics, and geographic expansion, experiencing substantial recovery in global aviation volumes due to easing travel restrictions, but faced negative impacts from inventory price risk and the withdrawal of troops from Afghanistan[84] - Land segment is positioned for market share growth, both organically and through acquisitions (e.g., Flyers), focusing on expanding sustainability offerings via World Kinect, with results influenced by market volatility and weather conditions[85] - Marine segment traditionally benefits from fuel price volatility and supply uncertainty, showing improved profitability in Q1 2022 due to increased global oil prices and related volatility, following a decline in 2020-2021 due to the COVID-19 pandemic[86] Results of Operations Consolidated Results of Operations Consolidated revenue for Q1 2022 increased by 108% to $12.4 billion, driven by higher prices and volumes across all segments. Gross profit rose 21% to $230.9 million, while operating expenses increased 23% due to the Flyers acquisition and higher business activity. Net income attributable to World Fuel increased by 39.2% to $26.3 million | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :---------------------------------------- | :-------------- | :-------------- | :---------------- | :------------- | | Revenue | $12,382.0 | $5,957.9 | +$6,424.1 | +107.8% | | Gross profit | $230.9 | $191.6 | +$39.3 | +20.5% | | Operating expenses | $189.6 | $154.0 | +$35.6 | +23.1% | | Income from operations | $41.3 | $37.6 | +$3.7 | +9.8% | | Net income attributable to World Fuel | $26.3 | $18.9 | +$7.4 | +39.2% | - The increase in operating expenses was partially attributable to $18.4 million from Flyers' operating expenses, as well as increased compensation and employee benefits and higher general and administrative costs associated with more normalized business activity[90] - Net non-operating expense decreased by $1.3 million, primarily due to equity in earnings and foreign currency gains, partially offset by a $5.6 million increase in interest expense driven by incremental borrowings related to the Flyers acquisition[91] Aviation Segment Results of Operations Aviation segment revenue surged 139% to $5.0 billion in Q1 2022, driven by higher jet fuel prices (+70%) and increased volumes (+45%) as air travel recovered. However, gross profit decreased by 16% to $64.2 million, and income from operations fell 67% to $7.5 million, primarily due to inventory losses from price volatility and reduced government activity in Afghanistan | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :------------------------------------ | :-------------- | :-------------- | :---------------- | :------------- | | Revenue | $5,010.5 | $2,095.0 | +$2,915.5 | +139.2% | | Gross profit | $64.2 | $76.7 | $(12.5) | -16.3% | | Income from operations | $7.5 | $23.0 | $(15.5) | -67.4% | | Volumes (gallons) | 1,655.4 | 1,143.4 | +512.1 | +44.8% | | Average price per gallon | $2.91 | $1.72 | +$1.20 | +69.8% | - The decrease in aviation segment gross profit was primarily attributable to inventory losses driven by significant price volatility and backwardation, and the reduction in government-related activity in Afghanistan[94] Land Segment Results of Operations Land segment revenue doubled to $4.4 billion in Q1 2022, driven by higher average prices (+65%) and the Flyers acquisition, which also increased volumes by 21%. Gross profit increased 34% to $119.8 million, largely due to Flyers' contribution, despite reduced government activity and a decline in natural gas activities. Income from operations saw a modest 2% increase to $33.4 million | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :------------------------------------ | :-------------- | :-------------- | :---------------- | :------------- | | Revenue | $4,380.8 | $2,188.2 | +$2,192.7 | +100.2% | | Gross profit | $119.8 | $89.5 | +$30.3 | +33.8% | | Income from operations | $33.4 | $32.8 | +$0.6 | +1.8% | | Volumes (gallons) | 1,582.6 | 1,303.0 | +279.5 | +21.5% | | Average price per gallon | $2.77 | $1.68 | +$1.09 | +64.9% | - The increase in land segment gross profit was primarily attributable to Flyers' gross profit of $36.1 million, partially offset by reduced government-related activity in Afghanistan and a decline in natural gas activities[97] - Income from operations increased due to Flyers' contribution of $17.6 million, partially offset by reductions in gross profit from other activities and increased operating expenses[98] Marine Segment Results of Operations Marine segment revenue increased 79% to $3.0 billion in Q1 2022, driven by a 61% rise in average bunker fuel prices and an 11% increase in volumes. Gross profit surged 85% to $47.0 million, and income from operations increased 264% to $23.1 million, primarily due to the impact of rising global oil prices and a constrained credit environment | Metric | 2022 (Millions) | 2021 (Millions) | Change (Millions) | YoY Change (%) | | :------------------------------------ | :-------------- | :-------------- | :---------------- | :------------- | | Revenue | $2,990.6 | $1,674.7 | +$1,315.9 | +78.6% | | Gross profit | $47.0 | $25.4 | +$21.5 | +84.6% | | Income from operations | $23.1 | $6.4 | +$16.8 | +262.5% | | Volumes (metric tons) | 4.7 | 4.2 | +0.5 | +11.9% | | Average price per metric ton | $637.61 | $395.65 | +$241.96 | +61.2% | - The increase in marine segment gross profit and income from operations was principally attributable to the impact of the rise in global oil prices and the resulting constrained credit environment[100][101] Liquidity and Capital Resources The company's liquidity, comprising cash and Credit Facility availability, is deemed sufficient for the next twelve months. Operating cash flow decreased significantly due to increased working capital needs from higher fuel prices and volumes, while investing activities were dominated by the Flyers acquisition. Financing activities provided substantial cash through increased borrowings Sources of Liquidity and Factors Impacting Our Liquidity - The company's liquidity, consisting principally of cash and availability under its Credit Facility, is believed to be sufficient to fund working capital and capital expenditure requirements for at least the next twelve months[103][104] - The Credit Facility was amended on April 1, 2022, increasing total borrowing capacity to $2.0 billion and extending maturity to April 1, 2027, but availability is limited by a consolidated total leverage ratio of not more than 4.75 to 1[105] - The company sold $2.6 billion in qualifying accounts receivable under Receivable Purchase Agreements (RPAs) during Q1 2022 (vs. $2.0 billion in Q1 2021)[107] Future Uses of Liquidity - Cash is primarily used to fund working capital, strategic acquisitions, and investments, with no material changes in expected future uses of liquidity from December 31, 2021, to March 31, 2022[108] Cash Flows | Cash Flow Activity | 2022 (Millions) | 2021 (Millions) | Change (Millions) | | :---------------------------------- | :-------------- | :-------------- | :---------------- | | Net cash provided by (used in) operating activities | $(72.0) | $103.4 | $(175.4) | | Net cash provided by (used in) investing activities | $(657.3) | $(2.7) | $(654.6) | | Net cash provided by (used in) financing activities | $343.7 | $(20.8) | +$364.5 | - Net cash used in operating activities was $72.0 million in Q1 2022, a $175.4 million decrease from Q1 2021, principally due to a $161.6 million increase in working capital driven by higher fuel prices and increased volumes[110] - Net cash used in investing activities was $657.3 million, primarily driven by $639.4 million for the Flyers acquisition and $14.6 million for capital expenditures[111] - Net cash provided by financing activities was $343.7 million, mainly from a $380.3 million net increase in borrowings related to the Flyers acquisition, partially offset by $13.7 million in common stock repurchases and $7.4 million in dividend payments[112] Critical Accounting Estimates - There have been no material changes to the Critical Accounting Estimates disclosed in the 2021 10-K report[114] - Based on assessments as of March 31, 2022, the carrying value of long-lived assets and equity investments were recoverable, and the fair value of land and aviation reporting units were not less than their respective carrying values, considering current market volatility and geopolitical risks[115][116] Item 3. Quantitative and Qualitative Disclosures About Market Risk There have been no material changes to the company's exposures to commodity price, interest rate, or foreign currency risk since December 31, 2021 - There have been no material changes to the company's exposures to commodity price, interest rate, or foreign currency risk since December 31, 2021[117] Item 4. Controls and Procedures Management, including the CEO and CFO, evaluated the effectiveness of disclosure controls and procedures as of March 31, 2022, and concluded they were effective at a reasonable assurance level. There were no material changes in internal control over financial reporting during the quarter Management's Evaluation of Disclosure Controls and Procedures - The CEO and CFO concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2022[119] Changes in Internal Control over Financial Reporting - There were no changes in internal control over financial reporting that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting during the three months ended March 31, 2022[120] Part II. Other Information Item 1. Legal Proceedings The company is involved in various tax and commercial legal proceedings in multiple countries, including Brazil, Denmark, South Korea, and the U.S. While no current claim is expected to have a material adverse effect, an unfavorable resolution of any matter could be material to financial statements - The company is under review by tax authorities and involved in various inquiries, audits, challenges, and litigation in countries including Brazil, Denmark, South Korea, and the U.S., where the amounts under controversy may be material[123] - Currently, the company is not a party to any claim, complaint, or proceeding that is expected to have a material adverse effect on its business or financial condition, but an adverse resolution of one or more such matters could be material[124] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company repurchased 500 thousand shares of common stock in March 2022 at an average price of $27.41 per share. As of March 31, 2022, approximately $182.1 million remained available under the $200.0 million 2020 Repurchase Program | Period | Total Number of Shares Purchased (Thousands) | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (Thousands) | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (Millions) | | :-------------------- | :----------------------------------------- | :--------------------------- | :----------------------------------------------------------------------------------------- | :------------------------------------------------------------------------------------------------ | | 3/1/2022 - 3/31/2022 | 500 | $27.41 | 500 | $182.053 | | Total | 500 | $27.41 | 500 | $182.053 | - As of March 31, 2022, approximately $182.1 million remained available for purchase under the $200.0 million 2020 Repurchase Program, which has no expiration date[125] Item 6. Exhibits This section lists the exhibits filed as part of the 10-Q Report, including certifications from the CEO and CFO (Rule 13a-14(a) and Section 906 of Sarbanes-Oxley Act) and XBRL formatted financial statements - Key exhibits include certifications from the Chief Executive Officer and Chief Financial Officer (pursuant to Rule 13a-14(a) and Section 906 of the Sarbanes-Oxley Act of 2002) and XBRL formatted financial statements[127] Signatures The report was duly signed on April 29, 2022, by Michael J. Kasbar, Chairman, President and Chief Executive Officer, and Ira M. Birns, Executive Vice President and Chief Financial Officer, pursuant to the requirements of the Securities Exchange Act of 1934 - The report was signed on April 29, 2022, by Michael J. Kasbar, Chairman, President and Chief Executive Officer, and Ira M. Birns, Executive Vice President and Chief Financial Officer[130]