Vertex Energy Used Motor Oil Recycling Industry Overview
Investment highlights
Second-largest processor of used motor oil ("UMO") in North America, with processing capacity of over 115 million gallons
(-23% of the North American UMO market)
Overall volumes of product sold - which measures reach into the market - decreased 2% for the 12 mos. ended Q4 2015 versus Q4
2014
Street Collections increased 50% for the 12 mos. ended Q4 2015 versus Q4 2014
■ Top-tier base of nationwide assets - creates an organization with deep vertical integration expertise across the UMO value chain
Regional model with strategic hubs located in key geographic areas
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Opportunity to optimize logistics, increase direct collections to capture additional margin
Allows for "local expertise" in each market, which leads to understanding and realizing increased leverage across the country
Market leverage around pricing – industry leaders in managing spread
New paradigm in the market for collected/aggregated UMO – shift toward an environmental services model
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Oil collection recently moved from pay-for-oil ("PFO") to zero-pay ("ZP") with the current trend toward charge-for-oil ("CFO") -
generators will pay Vertex to collect UMO
Current market price for UMO at the generator level is approximately $0.27/gallon versus $.12 at December 31, 2015 CFO versus
$1.00/gallon PFO 12 months ago
Paradigm shift provides for opportunities to increase market share on the street
Firm steps taken to protect against future extreme volatility
New partnership limits marketing/trading risk
Proven and experienced management with comprehensive industry knowledge
VERTEX.
ENERGY
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