Good day, everyone, and welcome to today's EzFill Holdings, Inc. Q2 2022 earnings call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer period. You may register to ask a question at any time by pressing star one on your touchtone phone. If you should need audio assistance during your call today, please press star zero. It is now my pleasure to turn today's call over to investor relations, John McNamara. Please go ahead.
Thank you, Ashley. Good afternoon, everybody, and thank you again for joining us for the EzFill conference call to discuss 2022 Q2 financial results. With us today from management are Mike McConnell, Chief Executive Officer, and Arthur Levine, Chief Financial Officer. Before we begin, as usual, we would remind everyone that certain matters discussed during today's call or answers that may be provided to questions may constitute forward-looking statements as defined under federal securities laws. Words such as may, should, projects, expects, intends, plans, believes, anticipates, hopes, estimates, and variations of such words or similar expressions are intended to identify forward-looking statements. These statements are subject to numerous conditions, many of which are beyond the control of the company, including those set forth in the Risk Factors section of the company's annual report on Form 10-K filed with the SEC.
Copies of these documents are available on the SEC's website as well as on the company's website. Actual results may differ materially from those expressed or implied by such forward-looking statements. The company undertakes no obligation to update these statements for revisions or changes after the date of this call, except as required by law. I'd now like to turn the call over to Mike McConnell. Go ahead, Mike.
Thank you, John. Good afternoon, everyone, and thank you for joining us today to review our Q2 2022 results. As our press release indicated, we continue to execute our growth strategy as one of the fastest-growing on-demand mobile fuel providers. We grew revenue by more than 100% from the Q2 of last year. We improved our margin per gallon and expanded our operations in key population centers. Overall, we're very pleased with our performance. On a macro level, the trends that drive our business remain strong. We continue to see a decline in the total number of gasoline stations, and I'd note anecdotally that certain California cities have banned new gas stations in the state.
We don't necessarily see that as a national trend, and of course, we don't currently do business in California, but it certainly indicates the political environment for new gas stations is not favorable throughout the country. The commercial market remains strong as companies come to recognize that our value proposition goes well beyond the convenience of on-site fueling. Fleet companies recognize the services that we provide help their bottom line by helping them eliminate driver downtime as well as fraud, which reduces their costs. At the same time, consumers have clearly demonstrated a preference for on-demand, on-site delivery of goods and services, and we continue to see a strong and growing evidence that this consumer preference will extend towards mobile fueling. Before Arthur reviews our financial results for the quarter, I'd like to highlight a few key developments in Q2 performance.
We've added approximately 30 new fleet customers in the quarter, bringing our total since the beginning of the year to approximately 40. Not only is this a positive development in and of itself, but with each new commercial agreement, we reduce our reliance upon any one large customer. At the time of our IPO, almost 60% of our business came from a single customer. In Q2, that number was less than 40%, and we continue to drive that number down as our business grows. We did land a new customer, one of the country's largest grocery store chains.
While we can't get into specifics about the identity, we can state that this is an ideal customer for us, a well-known grocery chain making decisive entry into home delivery, meeting a growing consumer demand just as we are, with the opportunity to expand the client relationship as they grow, and we demonstrate our value proposition to them. We've expanded operations to additional markets beyond Miami. West Palm Beach, Tampa, and Orlando are now among our markets. While we have already begun commercial deliveries in these locations, we are working diligently for the approvals to support residential consumers and retail marine demand in these markets as well. Our on-demand consumer and specialty business combined continue to contribute approximately 20% of our revenue.
Our fleet size was 30 at the end of Q2, and it's since grown to 36 delivery vehicles with more planned for delivery as we grow. We're excited about our recently launched marketing campaign aimed at building brand awareness. This is going to be a comprehensive plan, including billboard outdoor, barge, aerial banners, radio, and social media posts, so we're putting a lot of effort into this and we're looking forward to the results. As we approach hurricane season, we're delighted to have launched our emergency fuel services program in which we ensure that clients can rest easy knowing that should a hurricane disrupt fuel supplies, their vehicles will remain fueled. We've made strong progress on key initiatives. We showed strong revenue growth in both the three month and six month period, as well as sequential growth from the Q1 period. We've added customers and increased our fleet.
We've expanded into new markets and diversified our customer base. We've laid the groundwork for continued growth in all three of these verticals, and I think it's fair to say that we delivered what we said we'd deliver, and we expect that we'll continue to see steady progress going forward. With that, I turn the call over to Arthur, who will walk you through the financial results. Go ahead, Arthur.
Thank you, Mike. Our financial results for the quarter continue to illustrate the growth we've outlined to the investment community, the investment in infrastructure to support demand as our revenue ramps. Revenue for the Q2 of 2022 increased 103% to $3.75 million from $1.85 million in the prior year period. The increase was driven by a 30% increase in total gallons delivered from 607,765 to 789,970 gallons in the Q2 of 2022. Cost of sales was $3.8 million for the Q2 compared to $1.8 million in the prior year period. It reflects the increase in sales as well as the hiring of additional drivers to support the growing business, primarily in new markets.
Operating expenses excluding depreciation and amortization were $3.4 million for the Q2 of 2022 compared to $1.7 million in the prior year period, a net increase of $1.7 million. The major increases were in payroll, insurance, and public company expenses. We were not only able to maintain our margin per gallon in the period, but to increase it 32% from $0.37 per gallon in 2021 to $0.49 per gallon in the Q2. Keep in mind what the environment for the fuel markets have been. Fuel prices were already rising, challenging everyone's cost structure, when, into the mix, we saw the outbreak of war in Ukraine. Despite this, we were able to increase our overall fuel margin, mainly due to the addition of new fleet accounts at significantly higher average margins per gallon.
We expect that as we continue to add an increasing number of commercial fleet accounts and more consumers, including marine, our average fuel margin per gallon will continue to remain strong. Depreciation and amortization increased to $46.46 million in the Q2 of 2022 from $0.23 million in the prior year period, primarily in the fleet of delivery vehicles. On a GAAP basis, we reported a net loss in the Q2 of 2022 of $3.9 million compared to $2.2 million in the prior year period. Adjusted EBITDA loss in the Q2 of 2022 was $3 million compared to a loss of $1.2 million in the Q2 of 2021.
The increased loss in the Q2 of 2022 reflects increased spending on infrastructure to grow and expand the business in the operating expense areas previously noted. Interest expense decreased in the quarter due to the early repayment in September 2021 of pre-IPO debt. Our cash position at quarter end was $10.2 million, including investments, compared with $16.9 million at year-end 2021. We had no long-term debt and had outstanding borrowings under our credit line of $850,000. Our most recent quarterly results continue to reflect our efforts to enhance and optimize our infrastructure in order to support growth in new markets that we began to serve in Q2. The demand remains strong in our home market of Miami and is increasing in our recently entered markets.
We experienced strong top-line growth in Q2, reflecting the new fleet contracts we signed both in Q1 and Q2. As we continue to serve more and more businesses and consumers in each market and scale our business, we will increase utilization of our truck fleet. We expect the delivery fleet size to reach 40 before the end of Q3, and it could approach 50 by year-end under current commitments. We will continue to monitor developments in truck availability and evaluate when we will take the remaining deliveries under our current commitments and when we will make commitments to invest in additional trucks. In the meantime, we have more than enough truck capacity to grow our business as planned.
Going forward, we will continue to spend as needed to support our new markets with a focus on hiring additional drivers and sales reps, as well as completing the advertising campaign that is currently in progress. We will be careful about other spending as we have already built out our core infrastructure to support our growth. With that, we'll be happy to take any questions.
At this time, if you would like to ask a question, please press star one on your touch-tone phone. We'll take our first question from Tate Sullivan with Maxim Group. Please go ahead, your line is open.
Hi. Thank you. Good afternoon, Mike and Arthur. Certainly, you ended off, Arthur, with the planning to have the fleet at 40 before the end of this current quarter and then could approach 50. Related to your expansion plans too, do you already have the locations planned for where those trucks will go? Or does that depend on various factors?
Well, yeah, I mean, as of today, we have 36 trucks, and, you know, those trucks are all already deployed. If we enter a new market in the next quarter, then we'll probably deploy two trucks in that market and then the other two where they're most needed.
Mike, related to that, the logistics about planning to start in another or go to another city or area, I mean, does it start with having the existing fleet customers already operate there? Does it have to start with getting new fleet customers, but for the infrastructure, the parking, refueling, employees? Can you talk about how it works for the logistics of expansion, please?
Hello, Arthur. Can you hear me there? Okay.
Yep, sorry about that. No, good question. Yeah, we'll continue to leverage our current relationships, you know, with ones that are in Miami that have multiple locations throughout the state, regionally, and even nationally, and having discussions with them about growing our business along with theirs to expand. New York will continue to be a market, you know, that we're growing and looking at and planning on entering into hopefully sometime this calendar year. Certainly we'll continue to expand though leveraging our current relationships.
Okay. Is infrastructure behind expanding to other cities really not a concern or a cost pressure? Just is that simply just finding the parking for the vehicles and the refueling infrastructure? Is that not a-
Yeah, we've learned a lot as far as expansion into West Palm Beach, Tampa, and Orlando as far as what you need in the expansion part of the process. You're right, it's about the facility parking, fueling, the regulatory environment, getting the compliance, approved and those kind of things. I think we have a good idea of what it will take, how much it takes to enter into a market and what the minimum requirements are from a servicing point of view. Our plan is to start with the fleet business and leveraging the fleet business as we enter. We'll have a revenue stream, you know, from day one. Certainly the cost will precede the revenue streams as we go into these new markets, which we've seen with our results this quarter.
We'll start to be able to leverage a lot of the expansion that we've already done in West Palm Beach, Tampa, and Orlando. In Q3 we'll start to see a lot of the good benefits of that, since some of the costs have really been incurred as far as that expansion process.
I mean, 30 customers in the quarter, I think I heard you correctly. I mean, up from, if I counted correctly.
Yep.
Three, I mean, and you're at 40 now, so I mean, 10 in the prior two quarters for Q 2021 and Q1 . Maybe that's not exactly right. But nonetheless, 30 in this quarter. What created that momentum? Is it seasonal potentially signing up the customers or is it smaller customers than you were signing up before perhaps? Or.
No, I think it's part of it is our sales fleet. You know, we've added some with that and we get really an instant response. We've got four people, five now, in some of those markets and some of the new markets that we've entered into. I think also we've got some time in those markets, so as we're continuing to grow and promote and our sales people continue to leverage the relationships that we currently have, we are extremely optimistic about our fleet business continuing to grow.
Great. I'll see if there's other questions maybe to come back after, operator, if there's not any. I mean, the momentum in the average margin per gallon is impressive. I mean, the last three, four quarters, and Arthur, on your comments, it sounds like that can continue. I mean, it seems like once you have those momentum, you sign up higher contracts, quite predictable in what you can price to the fleet customers. Are there any downside risks to where you are now to that average margin per gallon as you see it in the current discussions?
Yeah, I'll answer that, Tate. So the average has been going up because the, you know, the very large fleets that had been a drag on the margin, you know, we're more or less flat, the existing large fleet business, except for one new one. We did have one new very large fleet this quarter, but there were a lot of new small to medium sized fleets that were signed up at healthy margins that increased the overall average. I'll add to that a very significant portion of the new business was in the new markets. All right. So that really helped as well. I mean, there was significant new business in the existing market, but also in all of the new markets.
Yeah. Great. Thank you both.
Thanks.
Mr. Tate, if you have any further questions, you can continue with your questions, or we'll just-
Okay.
Apologize.
All right. Thank you. Okay, just one more. I saw in the release. Thank you. You mentioned three verticals in the market. I mean, the fleet, the retail, and then the third marina, or did I see that correctly, please?
Yeah, that's right. I mean, you know, the specialty business, what we call specialty is, you know, marine construction, landscaping, those kind of things. We've got consumer fleet, and then specialty, which is really the vertical, which includes residential.
Okay, great. The consumer effort. You're out there marketing. Are you signing up consumer customers already or is that to come or how is that initiative?
Yeah, no, it's kinda in process. You know, we went on a very robust campaign, I would say, starting in you know, the May, June time period. We're just beginning to get a lot of results back. The initial results as far as downloads, receptivity, understanding which of the tactics are most effective, we're gathering a lot of information and learning a lot. The response has been received pretty well. What we've got to do now is track it through the entire process to understand you know, the order process, and then evaluate the cost and the return and which channel is most effective for us. We'll definitely probably be reporting you know, more detail on that in Q3 as we learn more.
Yeah. I can imagine all of that, and you'll be the experts on fueling in all your regions. Great. Thank you very much for answering all the questions.
Thanks, Tate.
Thanks.
There are no further questions. I'll turn the call back over to Mike McConnell for any closing remarks.
Okay. Just wanna say thank you all for joining us, and we look forward to reporting back to you in the Q3. Thank you. Have a good evening.
Thank you. This does conclude today's program. Thank you for your participation. You may disconnect at any time.
Thank you.