The Company reported a continuation of the trend of financial improvement for the first six months of fiscal 2009, reporting a net loss of $148,000, an improvement of $4.9 million compared to a loss of $5.0 million in the prior year. EBITDA (a non-GAAP measure) for the first six months was $2.7 million, an improvement of $2.9 million compared to negative EBITDA of $191,000 in the prior year. The Company reported a net loss of $660,000 for the second quarter of 2009, an improvement of $1.3 million compared to a loss of $2.0 million in the prior year. EBITDA of $690,000 for the second quarter of fiscal 2009 was an improvement of $1.1 million compared to negative EBITDA of $387,000 in the prior year. Net margin per gallon increased to 27.6 cents in the first six months of fiscal 2009 from 17.7 cents the prior year and 21.3 cents for the second quarter of fiscal 2009 compared to 16.3 cents in the prior year.

Richard E. Gathright, Chairman, Chief Executive Officer and President, commented:

"We continued to focus on the improvement of our business by adding new customers, deriving higher net margin per gallon, managing our expenses and maintaining our customer base in a difficult economic environment. In the fourth quarter of fiscal 2008, we began a steady trend of financial performance improvement, evidenced by higher net margins, reduced losses, and improved EBITDA, which trend continued into the second quarter of this fiscal year. While our volumes decreased in the current quarter as a direct result of the rapid contraction of the national economy and the worldwide severe economic downturn and recession, impacting the majority of our 4,600 customers and all industry sectors that we service, we were nevertheless able to operate more efficiently, due in part to the greater visibility into our business provided by our new ERP system, which allowed us to react quickly to market conditions and business opportunities.

"We are especially pleased that we are able to report improved financial results in fiscal 2009 when compared to the prior year notwithstanding the dramatic decline in our volumes in November and December as a result of our customers delivering less of their goods and services in the face of the current worldwide financial crisis. We took swift far-reaching cost cutting and business restructuring steps beginning in late November, continuing through December and into the current quarter to respond to the decrease in customer demand. These steps have included eliminating operating and administrative personnel, reducing other employee expenses and benefits, maximizing the use of running equipment and reducing direct and office operating expenses. We have consolidated delivery routes wherever possible to improve efficiency, while insuring that we are able to maintain our same high level of service to our existing customers. This undertaking has required extremely detailed scheduling and planning as we have continued to aggressively seek and obtain new customers who are attempting to reduce their costs of operations or whose prior service providers were ineffective in delivering value.

"During this difficult market we have continued our track record of collecting our receivables. At December 31, 2008 our receivables were $15.0 million compared to $30.2 million at June 30, 2008, partly a reflection of decreased fuel prices, but also of our strong credit and underwriting efforts. Towards the end of January 2009, and into February we have experienced some stabilization of existing customer demand and volumes, together with a marked increase in new customer starts. While there can be no assurances that this trend will continue, we remain cautiously optimistic that these developments coupled with the cost cuts and efficiency improvements taken in response to the current deep economic recession, will positively impact our operations and financial performance."

Highlights of Second Quarter Fiscal Year 2009 vs. Second Quarter Fiscal Year 2008

Revenues were $45.1 million in the second quarter of fiscal 2009, a 24% decrease from $59.0 million in the same period in fiscal 2008, primarily due to a 29% decrease in the market prices of petroleum products versus the comparative period. Additionally, $4.7 million of the $13.9 million decrease was due to an 8% reduction in gallons sold to 16.6 million in the current period from 18.1 in the prior period. While the Company continued to add new customers during the second quarter of fiscal 2009, there was a dramatic and significant overall decrease in demand from existing customers beginning in November 2008, resulting in the overall reduction in volume sold during the quarter. This lower sales volume is a reflection of the deep economic recession and its sudden impact on our customers and the industries that we service.

The net loss of $660,000 in the second quarter of fiscal 2009 was a decrease of $1.3 million from the $2.0 million loss incurred in the prior year period. The improvement is primarily attributable to the continuing overall trend of improved margins established in the fourth quarter of fiscal year 2008. The decrease in loss was also due to a reduction of $521,000 in selling, general and administrative expenses as employee costs and the provision for doubtful accounts were reduced.

EBITDA (a non-GAAP measure) was $690,000 in the second quarter of fiscal 2009, a $1.1 million improvement from negative EBITDA of $387,000 generated in the prior year period.

Net margin per gallon increased to 21.3 cents in the second quarter of fiscal 2009 from 16.3 cents in the prior year, an increase of 5.0 cents, primarily as a result of higher margin business and improvements in operating efficiencies.

Highlights of Second Quarter Fiscal Year 2009 vs. First Quarter Fiscal Year 2009

Revenues were $45.1 million in the second quarter of fiscal 2009, a 43% decrease from $79.3 million in the first quarter of fiscal 2009 primarily due to a 46% decrease in fuel market prices. The decrease was also partially due to an 11% reduction in gallons sold to 16.6 million from 18.6 in the first quarter of fiscal 2009. While the Company continued to add new customers during the second quarter of fiscal 2009, there was a dramatic and significant overall decrease in volume demand from existing customers beginning in November 2008, resulting in the overall reduction in volume sold during the quarter. This lower sales volume is a direct result of the rapid contraction of the national economy and the current world-wide recession affecting the customers and industry sectors that the Company services. Finally, the decrease in revenues was also partially due to the emergency response services provided in the first quarter of fiscal 2009 that did not continue into the second quarter.

The net loss of $660,000 in the second quarter of fiscal 2009 was a decrease from net income of $512,000 in the first quarter of fiscal 2009. The decrease in earnings was primarily due to the lower volume in the second quarter, and the emergency response service margin generated as a result of the hurricane season in the first quarter of fiscal 2009, partially offset by a decrease in selling, general and administrative expenses.

EBITDA (a non-GAAP measure) was $690,000 in the second quarter of fiscal 2009, a decrease from $2.0 million in the first quarter of fiscal 2008.

Net margin per gallon decreased to 21.3 cents in the second quarter of fiscal 2009 from 33.2 cents in the prior quarter primarily as a result of higher margin from the emergency response services in the first quarter of fiscal 2009 that did not continue into the second quarter.

Highlights of First Six Months of Fiscal Year 2009 vs. First Six Months of Fiscal Year 2008

Revenues were $124.4 million in the six months ended December 31, 2008, a 9% increase from $114.5 million in the prior year six months. The $9.9 million increase was primarily the result of increased market fuel prices which were approximately 10% higher year over year. Price variances resulted in an increase of $14.9 million in revenues, including a partial contribution from the emergency response services provided during the first quarter of fiscal 2009, partially offset by a $5.0 decrease in revenues due to a 4% reduction in gallons sold to 35.2 million in the first six months of fiscal 2009 compared to the 36.7 million gallons sold in prior year. This decrease in gallons sold was due to the dramatic contraction of the economy experience in the second quarter of fiscal 2009.

The net loss was $148,000 in the six months ended December 31, 2008 compared to a loss of $5.0 million in the prior year period. The $4.9 million improvement was primarily the result of an overall higher net margin per gallon, including margin contributions from the emergency response services, improved efficiency from our new ERP system and a variety of cost cutting measures implemented on account of the deteriorating national economy. The loss on extinguishment of debt of $1.6 million recorded in the six months ended December 31, 2007, from the August 2007 refinancing with new senior secured convertible subordinated notes, also contributed to the reduced net loss for the period.