World Fuel Services Corporation Reports Solid Results and Strong Cash Flow for the Second Quarter of 2007

MIAMI, Aug. 9 /PRNewswire-FirstCall/ -- World Fuel Services Corporation , a global leader in the marketing and sale of marine, aviation and land fuel products and related services, today reported second quarter net income of $17.0 million, ($0.61 and $0.58 per share on a basic and diluted basis, respectively), compared to $14.5 million, ($0.53 and $0.50 per share on a basic and diluted basis, respectively), in the second quarter of 2006.

"The Company delivered solid year-over-year growth in volume and profitability in our marine, aviation and land segments as well as strong operating cash flow," said Paul H. Stebbins, Chairman and Chief Executive Officer. "Our aviation segment generated gross profit of $30.7 million, an increase of 55.4% sequentially and 16.0% year-over-year," added Stebbins. "The aviation segment rebounded strongly from the first quarter of 2007, which was adversely impacted by a rapid decline in jet fuel prices in the early part of the quarter. As expected, we benefited from the late first quarter rebound in jet fuel prices in the early part of the second quarter, contributing to the sharp sequential increase in gross profit."

Our marine segment generated gross profit of $25.3 million, a decrease of 14.6% from near record performance in the first quarter of 2007 but an increase of 7.5% year-over-year. "Our marine segment has now generated year-over-year increases in gross profit and operating income for ten out of the last eleven quarters, reflective of our continued leadership position in servicing this segment of the market," said Michael J. Kasbar, President and Chief Operating Officer. "Our land segment also continues to generate strong year-over-year increases in profitability, posting its fourth consecutive quarter of year-over-year increases in gross profit and operating income," added Kasbar.

The Company's effective tax rate for the second quarter was 27.5%. "Our tax rate was significantly higher than the first quarter due principally to the recovery in our domestic aviation business which shifted a greater portion of our income to a higher tax rate jurisdiction," said Ira M. Birns, Executive Vice President and Chief Financial Officer. "The higher tax rate in the second quarter was also further impacted by an additional income tax provision recorded in connection with FASB Interpretation No. 48 ("FIN 48")," added Birns.

SECOND QUARTER FINANCIAL HIGHLIGHTS ($ in thousands, except per share data) Quarter Ended June 30, 2007 2006 Revenue $3,273,359 $2,856,852 Income from operations $22,066 $17,036 Net income $16,988 $14,503 Basic earnings per share $0.61 $0.53 Diluted earnings per share $0.58 $0.50 About World Fuel Services Corporation

Headquartered in Miami, Florida, World Fuel Services Corporation is a global leader in the marketing and sale of marine, aviation and land fuel products and related services. World Fuel Services provides fuel and related services at more than 2,500 airports, seaports and tanker truck loading terminals worldwide. With 43 offices (including satellite offices) strategically located throughout the world, World Fuel Services offers its customers a value-added outsource service for the supply, quality control, logistical support and price risk management of marine, aviation and land fuel.

The Company's global team of market makers provides deep domain expertise in all aspects of marine, aviation and land fuel management. World Fuel Services' marine customers include international container and tanker fleets and time-charter operators, as well as the United States and foreign governments. Aviation customers include commercial airlines, cargo carriers and corporate clientele, as well as the United States and foreign governments. Land customers are primarily petroleum distributors. For more information, call [phone] or visit http://www.wfscorp.com/.

Information Relating to Forward-Looking Statements

With the exception of historical information in this news release, this document includes forward-looking statements that involve risks and uncertainties, including, but not limited to, quarterly fluctuations in results, the management of growth, fluctuations in world oil prices or foreign currency, major changes in political, economic, regulatory, or environmental conditions, the loss of key customers, suppliers or key members of senior management, uninsured losses, competition, credit risk associated with accounts and notes receivable, and other risks detailed from time to time in the Company's Securities and Exchange Commission filings. Actual results may differ materially from any forward-looking statements set forth herein.

WORLD FUEL SERVICES CORPORATION CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE DATA) For the Three Months Ended For the Six Months Ended June 30, June 30, 2007 2006 2007 2006 Revenue $3,273,359 $2,856,852 $5,975,568 $5,390,858 Cost of sales 3,215,371 2,805,410 5,866,412 5,289,671 Gross profit 57,988 51,442 109,156 101,187 Operating expenses: Compensation and employee benefits 22,087 20,476 44,962 39,220 Executive severance costs -- 1,545 -- 1,545 Provision for bad debts (313) 640 (700) 1,148 General and administrative 14,148 11,745 25,877 22,285 35,922 34,406 70,139 64,198 Income from operations 22,066 17,036 39,017 36,989 Interest and other income, net 1,552 832 2,325 804 Income before income taxes 23,618 17,868 41,342 37,793 Provision for income taxes 6,506 3,287 9,345 8,403 17,112 14,581 31,997 29,390 Minority interest in (income) loss of consolidated subsidiaries (124) (79) (180) 90 Net income $16,988 $14,502 $31,817 $29,480 Basic earnings per share $0.61 $0.53 $1.14 $1.09 Basic weighted average shares 28,061 27,115 28,028 27,064 Diluted earnings per share $0.58 $0.50 $1.09 $1.02 Diluted weighted average shares 29,103 28,873 29,107 28,780 WORLD FUEL SERVICES CORPORATION CONSOLIDATED BALANCE SHEETS (UNAUDITED - IN THOUSANDS) As of June 30, December 31, 2007 2006 ASSETS CURRENT ASSETS: Cash and cash equivalents $220,587 $176,495 Short-term investments -- 12,500 Accounts and notes receivable, net 1,005,303 860,084 Inventories 85,246 74,519 Receivables related to derivative contracts 44,063 37,070 Prepaid expenses and other current assets 51,384 35,423 Total current assets 1,406,583 1,196,091 PROPERTY AND EQUIPMENT, NET 31,891 26,730 OTHER ASSETS 60,312 54,579 $1,498,786 $1,277,400 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Short-term debt $7 $10 Accounts payable 886,928 720,790 Payables related to derivative contracts 44,489 34,209 Accrued expenses and other current liabilities 72,968 71,752 Total current liabilities 1,004,392 826,761 LONG-TERM LIABILITIES 47,129 24,670 SHAREHOLDERS' EQUITY 447,265 425,969 $1,498,786 $1,277,400 -- -- WORLD FUEL SERVICES CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED - IN THOUSANDS) For the Three Months For the Six Months ended ended June 30, June 30, 2007 2006 2007 2006 Cash flows from operating activities: Net income $16,988 $14,502 $31,817 $29,480 Adjustments to reconcile net income to net cash provided by operating activities: Provision for bad debts (313) 640 (700) 1,148 Depreciation and amortization 1,430 1,099 2,762 2,103 Executive severance costs -- 1,545 -- 1,545 Deferred income tax (benefit) provision (1,293) 133 (1,417) 2,620 Share based payment compensation costs for employees and non-employee directors 1,828 1,556 3,657 2,490 Unrealized losses from derivatives and related hedged items, net (296) 691 41 265 Other non-cash operating charges (138) (225) (187) (32) Changes in operating assets and liabilities: Accounts receivable (118,730) (18,486) (144,519) (89,378) Inventories (21,305) (11,947) (10,148) (19,109) Receivables related to derivative contracts 3,004 (8,682) (7,037) (24,999) Prepaid expenses and other current assets (8,209) 18,835 (14,488) 6,570 Non-current income tax receivable and other assets (916) (249) (1,389) (118) Accounts payable 155,021 22,438 166,138 105,514 Payables related to derivative contracts (2,980) (1,829) 9,660 15,032 Accrued expenses and other current liabilities 11,817 (15,787) 6,815 (5,739) Non-current income tax payable, deferred compensation and other long-term liabilities (1,181) 68 295 (165) Total adjustments 17,739 (10,200) 9,483 (2,253) Net cash provided by operating activities 34,727 4,302 41,300 27,227 Cash flows from investing activities: Capital expenditures (4,526) (7,984) (7,130) (10,046) Purchases of short-term investments (5,002) -- (20,060) (21,055) Proceeds from the sale of short- term investments 32,510 10,000 32,560 31,055 Acquisition of minority interests -- (46) -- (2,646) Net cash provided by (used in) investing activities 22,982 1,970 5,370 (2,692) Cash flows from financing activities: Dividends paid on common stock (1,063) (1,041) (2,126) (2,068) Minority interest distribution (426) 102 (426) (410) Repayment of promissory notes -- -- -- (500) Proceeds from exercise of stock options 197 4,203 626 4,670 Purchases of stock tendered by employees to satisfy the required withholding taxes related to share-based awards (568) (44) (939) (109) Other 193 (15) 287 (248) Net cash (used in) provided by financing activities (1,667) 3,205 (2,578) 1,335 Net increase in cash and cash equivalents 56,042 9,477 44,092 25,870 Cash and cash equivalents, at beginning of period 164,545 149,677 176,495 133,284 Cash and cash equivalents, at end of period $220,587 $159,154 $220,587 $159,154 Contacts: Ira M. Birns, Executive Vice President & Chief Financial Officer or Francis X. Shea, Executive Vice President & Chief Risk and Administrative Officer [phone]