Good morning, ladies and gentlemen, and welcome to the Vertex Energy Fourth Quarter and Full Year 2020 Earnings Conference Call. At this time, the floor will be placed in a listen-only mode and the floor will be open for questions and comments after the presentation. It is now my pleasure to turn the floor over to your host Noel Ryan. Sir, the floor is yours.

Thank you, Holly. Good morning and welcome to Vertex Energy's fourth quarter and full year 2020 results conference call. Leading the call today are our Chairman and CEO, Ben Cowart; our CFO, Chris Carlson; and our COO, John Strickland. We issued a press release before the market opened this morning, detailing our fourth quarter and full year results. In conjunction with this release, we also posted a conference call presentation that is located in the Investor Relations portion of our corporate website at vertexenergy.com. We will reference this presentation throughout the remainder of today's conference call. I'd also like to remind you that management's commentary and responses to questions on today's conference 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 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 a financial review from Chris Carlson. At the conclusion of these prepared remarks, we will open the line for questions. And with that, I'll turn the call over to Ben.

Thank you, Noel, and good morning to those joining us today. Early today, we posted a company presentation materials on the Investor Relations section of our website that we will refer to throughout this call. 2020 was one of the most challenging periods in the history of our company, a year impacted by global pandemic, feedstock supply shortages and weak refining margins yet. In many respects, it was also our finest hour, as we introduced new product lines, operational capabilities that lay the foundation for profitable growth in the years ahead. While our full year results reflect the impact of pandemic related challenges faced by many businesses in our industry, we believe the worst is behind us. During the fourth quarter and into the first quarter of 2021, UMO feedstock availability continues to improve while refined product margins recover meaningfully, leading us to operate our refineries at elevated rates. The fourth quarter marked the second sequential quarter of adjusted EBITDA improvement, given the combination of new investments, including those related to our filter and antifreeze products business. Together, we've targeted cost reductions and improved product margins although Marrero was impacted by extended downtime during the period, Heartland operated at peak utilization. Total direct used motor oil collections improved 9% year-over-year supported by organic growth in both new and existing accounts. As illustrated on Slide 5, the year over year decline in adjusted EBITDA was due mainly to a decline in refined product margins, given lower commodity prices together with lower sale volumes at Marrero. These headwinds are partially offset in the fourth quarter by improved performance at our metals division together with improved base oil prices. In recent months, the spread between high sulfur fuel and WTI crude oil has widened, as WTI prices have climbed higher to that end, the calendar monthly average spread between high sulfur fuel and WTI has more than doubled between the fourth quarter average and current posted prices. Although we haven't reverted back to pre-COVID spreads, we have made significant headway versus the same time last year. Within the domestic base oil markets, the market inventory for select base oil grades continues to decline due to production shortfalls. Given tighter inventory levels, major producers have increased prices on Group II and Group III base oils during the recent months. At Heartland, base oil prices increased 15% sequentially in the fourth quarter when compared to the third quarter of 2020. These price increases contributed to near record refined product margins at Heartland during March of 2021, leading us to operate the facility at peak rates. We currently anticipate that our base oil prices will increase at a rate in excess of four quarter levels during the first half of 2021. As we announced last quarter, Vertex is currently evaluating strategic alternatives for the business as we seek to maximize value for our shareholders. During this process, we have accelerated a number of new profit enhancing opportunities while seeking to further optimize our existing assets. As we look over the next 24 to 36 months, the restart of our Myrtle Grove facility in Bell Chase, Louisiana remains one of the most significant organic growth opportunities for our business. Following the Phase-One re-start of the facility, last year, Myrtle Grove has commenced operations to reclaim recycle use industrial waste streams. Unlike used motor oil waste streams, which we regularly process as feed stock at our Marrero and Hartland refineries, the waste streams being treated at Myrtle Grove site requires that we extract the hydrocarbon molecules from streams that include both water and solid waste such as those at the bottoms of paints and barges. Once, we begin processing these the stress streams and higher volume at Myrtle Grove later this year, we intend to supplement the feedstock supply to our Myrtle refinery and begin selling the high value hydrocarbon stream to target in markets. By year in 2022, we expect all reclamation and recycling operations at Myrtle Grove will be able to process more than 7 million gallons of residual oil annually resulting in more than $3 million annualized incremental EBITDA improvement by year end 2022. A second project at Myrtle Grove that is currently under evaluation involves the production feedstock for renewable diesel fuel plants using non-conforming organic oils such as animal tallow and vegetable oils. The use of organic oils in the production of transportation fuels reduces the consumption of gasoline and diesel made from crude oil and is also cleaner burning than traditional fossil fuels. We're currently considering the construction of a pretreatment facility at Myrtle Grove that once completed, will position us to supply renewable diesel producers with a steady supply of feedstock. While we believe the control of lower cost feedstocks will be important to the development of the U.S. renewable diesel market, the Company also has the refining background to internalize these pretreated feedstocks as part of a long term potential strategy. Realizing the importance of these new opportunities, we recently on boarded a highly experienced development team at Myrtle Grove led by John Carnahan, former COO of Novi, a company producing renewable base oils. John brings an extensive background in leadership and development from global chemical and petroleum companies and will be VP of Project Development for the site. Before I turn the call over to Chris for a discussion of our financial results, allow me to provide a high level outlook as we look ahead to the full year 2021. During January and February of this year, our refineries operated on plan at full production levels. Refined product margins at Heartland remain very strong while margins at Marrero have rebounded from fourth quarter levels. The turnaround in our metals business remains underway while collection calls continues to decline given improve economics of scale and new efficiencies. On balance, we expect to generate adjusted EBITDA in the range of $2 million to $2.5 million for the first quarter 2021. For the full year 2021, we expect to generate positive free cash flow net income and adjusted EBITDA although we are not providing specific range at this time. With that, I'll hand the call over to Chris for a review of our recent financial performance.

Thanks, Ben, and welcome to those joining us on the call today. Turning to Slide 8, for the three months ended December 31, 2020, we reported a net loss attributable to Vertex Energy of $3.4 million versus net income attributable to Vertex Energy of $1.4 million in the fourth quarter 2019. We reported adjusted EBITDA loss of $0.4 million for the fourth quarter of 2020 versus $6.1 million in the prior year period. During the fourth quarter, a combination of lower throughputs at our Marrero refinery and less favorable refined product margins contributed to a year-over-year decline in profitability. Throughput volumes at the Marrero refinery declined 25% on a year-over-year basis in the fourth quarter, as severe weather impacted operations and reduced access to you UMO feedstocks during October 2020, resulting in a $2.5 million impact to our operating income and EBITDA for the quarter. For the 12 months ended December 31, 2020, we reported a net loss attributable to the Vertex Energy of 12 million versus a net loss attributable to Vertex Energy of 5 million in 2019. Vertex reported adjusted EBITDA loss of 4.6 million in 2020 versus 3.9 million in 2019. Turning to Slide 9, collections levels have continued to improve since the second quarter of last year, as evidenced by gradual improvement in U.S. vehicle miles traveled. While miles traveled have not yet recovered to historical averages post-pandemic, we have continued to add customer counts resulting in organic growth and collected volumes. Increased volume growth has resulted in a decline in our cost per gallon to collect, given improved economies of scale, which has benefited our gross profit margin. In fact, our total collection costs per gallon declined nearly 20% during January 2021 versus the prior year period. Turning to Slide 10. As we look back at refinery utilization over the past year, it was a tale of two cities with Heartland outperforming Marrero. One of the primary reasons Heartland was able to operate at elevated rates throughout last year was that UMO availability in the Mid-Continent was much higher than in the Gulf Coast particularly after the pandemic hit. In addition, given previously completed maintenance, we opted not to do a frontend turnaround at the facility which reduced planned downtime. At Marrero, a pandemic related decline in UMO availability contributed to lower throughputs leading us through complete and extended turnaround during the second quarter. While weather related disruptions during October impacted fourth quarter utilization, as Ben indicated earlier, both refineries operated well being January and February, which bodes favorably for first quarter performance. Turning to Slide 11, for a discussion of our balance sheet and capital structure, as of December 31, 2020, we had total cash and availability on our lending facility 12.3 million, including cash and availability of about 11 million and 1.3 million, respectively. At year-end 2020, we had total term debt outstanding of 11.1 million, which included 4.2 million related to funds received under the Paycheck Protection Program, which is part of the recently enacted Coronavirus Aid Relief and Economic Security Act to CARES Act. We applied for loan forgiveness during the fourth quarter and are awaiting approval on our application. Following the recent rise in our share price, we have had several Series B and B1 preferred holders convert their holdings of preferred stock and the common stock. Today, preferred holders holding 2.5 million shares of Series B and B1 have converted such shares into the same number of shares of common stock. In addition, two holders exchanged 1.5 million shares of Series B preferred stock for 2.3 million shares of common stock, resulting in a retirement of $4.7 million of liquidation preference relating to such preferred. Further during the first quarter 2021, 1 million more have been exercised, resulting in net proceeds to Vertex of approximately $1.5 million. As a result of the recent conversions of preferred stock to common stock and including certain pending transactions, our total outstanding convertible preferred stock was 10 million shares as of March 9, 2021. Total diluted share count outstanding was 49.9 million as of March 9, 2021. With that, I will turn the call over to the operator as we take questions from those joining us on the call today.

[Operator Instructions] Your first question for today is coming from Amit Dayal. Please announce your affiliation then pose your question.

Hi. This is Amit from H.C. Wainwright. Good morning and thank you for taking my questions. On the vaccine utilization side then could you give us some sense of what the utilization levels sort of across the different facilities were in 2020? And where do you expect to be for 2021?

Yes, so Amit, thank you for the question, and the capacity utilization for 2021, I believe, is the question. We see pretty smooth sailing for both refineries there. They've actually performed well in January/February at basically peak rates and that was a build from November and December. So, we got four really strong production months under belt. March looks really good. And other than our plan turnaround at each facility this year, we hope we don't see weather impacts, but we believe the refineries will perform really well.

Understood. And on the UMO collection front, Ben, you did see growth last year. Do you feel this growth should continue this year, just based on, more driving and more economic activity with your existing sort of infrastructure for collection? And do you plan to add additional resources routes any other efforts to grow this business and how big potentially the UMO collection efforts can be in 2021?

Yes, very good question. Obviously, this has been a focus of the Company going back to '19 and all the way through the pandemic. So, I'm very pleased with how our collection team has maintained volumes and even through the downturn added year-over-year volumes. You can see we're 9% year-over-year. We still are at a setback to total miles driven. So, that is additional volume that will come back into the business without a lot of work. So, assuming people get back on the road and start driving. So, there's been a lot of time spent on sales and organic growth around the collection business. We will continue driving collections pretty hard. We've made significant investments in 2020 to increase our capacity both at a branch level. We've opened additional branches and locations in 2020 and also in 2021 already, and we've got a lot of new equipment, new trucks on the road to bring some new efficiencies into that business. And as it relates to all filters and ascorbic material that would need to be processed from the collection business we've made significant improvements to our plant, our processing plant for those materials in the Gulf that has opened up capacity to support that growth.

Great. Understood. And could you tell us whether already sort of in the feedstock collection business whether renewable diesel opportunity or is this something you are still thinking about entering?

Yes. No, we're not in that feed stock piece of the business today. It is something we're contemplating with our Myrtle Grove facility based on its asset capacity and its geographic location and the logistic benefits we have at that site. So, this is a growth for that asset that we are working on at this point.

Just one last one from me. Just from your commentary. Should we assume Heartland facility is potentially you're thinking about maybe monetizing this or maybe I got it wrong?

Well, there's nothing specific related to monetize in the Heartland facility. We've noted in our comments that, we continue to evaluate opportunities in different ways to create shareholder value related to our assets, and we've got a good partner in Heartland, and we've made a lot of headway with their capital, and obviously you can see improved -- continued improved results related to that operation. And we believe that will continue this year and all on into the future. So, we definitely -- we like what's been accomplished there. And so, we're kind of steady as we go at Heartland.

Your next question is coming from Michael Hoffman. Please announce your affiliation then pose your question.

Hey, Ben, it's Michael from Stifel. Could you talk about Heartland and Marrero from my different perspective? What do you think nameplate produced gallons should be at both of those? And how do you expect that to play out in 2021?

Yes. Good question. I would say you've got your feed capacity, if that's what you're speaking of. And we believe that, 2021 will probably run at our peak rates. We don't plan to expand the feed capacity at either refinery and that probably is a 65 to 68 million gallons at Marrero and 20 to 21 million gallons at Heartland. On the backside of Heartland, we've made capital improvements to the process that allows us to bring supplemental vacuum gas oil into raise our base oil production, and we're starting down that path today. So, those hopefully in 2021 warren, you'll see a record base oil cell production for that facility.

Yes. And how do I think about what's the production volumes are?

On the back side of the Marrero plant with some investments that we've made here, last year, we've improved the yield of our vacuum gas oil capacity. And so I think we're…

I think 52 million.

On product then you got your byproducts, asphalt and water that comes off the plant. On the -- John, on the base oil side for 2021, annualized basis.

16 million minimum, this year.

Yes. And we hope to see that move forward with these new improvements.

And would you redirect Marrero VGO into Heartland or that's just too valuable as a low sulfur marine fuel?

No, there's a competing interest in that molecule and we haven't had to do that to-date. There's been other VGO supply that we've been working with. And in so far in the labs and in some trial runs, everything was pretty good. But we could, we obviously have plenty of VGO. So, it's just economic decision.

And then can you tell us what the timing of your maintenance should be as far as quarters so you can flex that in and out of our quarterly modeling for cash utilization?

Yes, I'll just answer that. At Marrero, we will have a 10-day tour in the second quarter and then we'll have a mini four to five days planned maintenance in the whole quarter is there. And at Heartland, we will have a 10-day catalysts change in the second or third quarter. And then we'll have a seven day frontend tour in the fourth quarter.

10 weeks at Marrero and a little more than two weeks at Heartland for the year.

So one of the things that we can think about is normal capacity at current spreads is going to produce the level of EBITDA you're talking about, and then we can factor in sort of the disruption. And how that play out but what's one to look like if you translate and then two, three and four? But is that a starting place on our modeling or point??

Absolutely, that's right.

And then, is there anything you should remind us all about the cadence of activity compared to a year ago that we shouldn't forget?

No, we've been talking about a lot of organic growth in the business. I think this whole pandemic has been a really good window and an opportunity for us to dig deep into the business. We've made a lot of improvements across all our operations. We've had time to put a lot of new equipment on the road replacing some and adding new equipment. So our capacities and our operation are all in really good shape today. So, I believe that we're positioned well for organic growth on the investments and the asset capacity that we have and that's both from a process and from a collection standpoint.

And then with the preferred share conversion, what is your ownership look like now on the common side? How do we think about who owns what?

As far as levels of ownership.

Yes, percentage of ownership now that these preferred has converted into common vision? That that'll all end up in the market eventually, but I'm curious if you could share with us who are these large owners now?

I would have to direct you to the 13-F filings that came out recently and I mean the total share count, which was noted, is 49.9 million.

And then what's left in prefers is?

There's 10 million left and preferred today. And again, there are still some converting, that we've talked to that haven't fully converted yet.

Okay. So that was part B of this. So you would expect more the 10 to convert before we're done?

I would hope so, yes.

And those who aren't what's the basis for not doing so?

I can't really speak to their basis for their decision.

Okay. And then lastly, from our standpoint, you told us last year you were conducting a strategic review and all of the typical language including possible sales accounting blah, blah, blah. Where are we in the process of that review?

It's a continuation from the third quarter, Michael. We have several things that are now under review and we've got some outside help around that, but nothing that is ready to report on this call.

Your next question is coming from Eric Stein. Please announce your affiliations then pose your questions.

Yes, with Craig-Hallum. Good morning, everyone. I'll just queue with the few questions here. Good morning. Maybe the first two just on collection -- on the collection inside, anything you can share as to what your ultimate goal is in terms of volumes on the collection side? Obviously, the trends been very good before COVID throughout COVID, but maybe what you think or where you think will be at exit in 2021?

Well, our focus for 2021 as a rule, there's some acquisition targets that we're looking at up in the Midwest region, but in the Gulf, we've made a significant investment in new equipment across the board from and additional branches. So, we believe that we will focus on organic growth, for the most part in the Gulf for 2021. I think, 9%, year-over-year during a pandemic is to me somewhat relative to the 15% to 20% year-over-year growth that we've experienced. We hope that we'll see those levels continue to materialize around our collection business. So, our team's done a great job to build out new customers and new volumes. And so, if the recovery of vehicle miles traveled happens in 2021, based on pre-pandemic levels, then we should be back into those double digit growth numbers in volume.

Got it. And that puts, I guess, if I'm thinking about it correctly, mid-40 million, somewhere in that range?

Yes, I think that's right.

Okay. And maybe just turning to the whole charge for oil and pay for oil dynamic. Just curious, I know that spread management has been a big focus of yours, but just given the recent increase in oil prices. What are you getting? Where does that stand today? And is there any pushback from the other side of the transaction just because of where oil has gone?

So far so good, I mean, we're still in a charge type of zip code in the collection business. There's obviously some pay for oils based on big generators are contracts that we have our head in place and then there's some free pickups. So, it's across the board, but I think the market seems to be tempered from a street level. Nobody's really gone hard to the market even though base oil prices, which is your biggest demand for use motor oil has increased materially. There seems to be good discipline in the market and we're playing play in the same way.

Last question for me. Just on Myrtle Grove in the organic oils that had side of it. You mentioned the pre-treatment facility that you're thinking about, can just remind me what the CapEx requirement would be for that and maybe potential timing of that decision?

Yes, I think it's early, Eric, to look at the CapEx. It's a big play. So, I don't want to get a number out there that we're not able to stand behind. We've got an evaluation by a team internally to look at the different technologies and we're really early as far as putting the numbers, the CapEx numbers out there to that. So -- and it's going to, hopefully, in the next quarter, maybe the next quarter or two, we will have a lot of color on this as the work gets completed.

All right. Thank you. There are no more questions in queue.

Okay. Well, thank you, everybody, for joining us today on our call and we look forward to a continued dialogue here as the Company moves forward. In the interim, should you have any questions, please contact our Investor Relations team at ir@vertexenergy.com. So, thank you, everyone, for joining us today. This concludes our conference call.

Thank you, ladies and gentlemen. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your participation.