- Reported second quarter 2017 net
earnings of $14.5 million compared to $10.3 million in the prior
year second quarter
- Reported second quarter 2017
Consolidated EBITDA of $28.8 million compared to $23.1 million in
the prior year second quarter
- Reported second quarter 2017
distributable cash flow of $24.5 million compared to $18.1 million
in the prior year second quarter
- Reported second quarter 2017
distribution coverage of 1.62x and leverage of 2.87x
- Increased the distribution for the
seventh consecutive quarter
- Achieved record levels of revenue,
consolidated EBITDA and distributable cash flow for the second
quarter 2017
TransMontaigne Partners L.P. (NYSE:TLP) (the Partnership,
we, us, our) today announced second quarter 2017 financial and
operating results.
“Our business continued to perform extremely well during the
second quarter of 2017: achieving another quarter of record
revenue, EBITDA and distributable cash flow; and, distribution
coverage of more than 1.62 times,” said Fred Boutin, Chief
Executive Officer of TransMontaigne Partners. “During the second
quarter we placed into service the final 800,000 barrels of new
tank capacity at our 2,000,000 barrel Collins Phase I expansion
project. This project, along with the strength of our base
business, supported an increase in our distribution of 1.5 cents
for the second quarter. Our distribution of 74 cents for the second
quarter represented growth of 2.1% over the previous quarter and
7.2% over the second quarter of last year.”
FINANCIAL RESULTS
Revenue for the second quarter of 2017 totaled $45.4 million, an
increase of $4.3 million, or approximately 10.5%, compared to the
$41.1 million reported for the second quarter of 2016. Consolidated
EBITDA for the second quarter of 2017 of $28.8 million represented
a $5.7 million, or approximately 24.7% increase compared to the
$23.1 million reported for the second quarter of 2016. The
improvement compared to the prior year was primarily attributed to
our Collins Phase I terminal expansion coming on-line revenue and
re-contracting of storage capacity throughout the past year,
including a portion at higher rates and greater utilization.
Terminaling services fees from firm commitments were
approximately 74% of second quarter 2017 total revenue.
Approximately 63% of our terminaling services revenues for the
second quarter of 2017 were generated from agreements with
remaining firm commitments of three years or more as of June 30,
2017.
An overview of our financial performance for the quarter ended
June 30, 2017 compared to the quarter ended June 30, 2016,
includes:
- Operating income for the quarter ended
June 30, 2017 was $17.3 million compared to $12.9 million for the
quarter ended June 30, 2016. Changes in the primary components of
operating income are as follows:
- Revenue increased approximately $4.3
million to $45.4 million due to increases in revenue at the Gulf
Coast, Midwest and Southeast terminals of approximately $2.4
million, $0.2 million and $4.4 million, respectively, partially
offset by a decrease in revenue at the Brownsville and River
terminals of approximately $1.1 million and $1.7 million,
respectively.
- Direct operating costs and expenses
decreased approximately $1.7 million to $16.0 million due to
decreases in the Midwest, Brownsville and River terminals of
approximately $0.2 million, $0.9 million and $0.7 million,
respectively, partially offset by an increase at the Southeast
terminals of approximately $0.1 million. Direct operating costs and
expenses for the Gulf Coast terminals were consistent.
- General and administrative expenses
increased approximately $0.6 million to $4.1 million.
- Depreciation and amortization expenses
increased approximately $0.7 million to $8.8 million.
- Net earnings were $14.5 million for the
quarter ended June 30, 2017 compared to $10.3 million for the
quarter ended June 30, 2016. The increase was principally due to
the changes in quarterly operating income discussed above.
- Quarterly net earnings per limited
partner unit was $0.70 per unit for the quarter ended June 30, 2017
compared to $0.50 per unit for the quarter ended June 30,
2016.
- Consolidated EBITDA for the quarter
ended June 30, 2017 was $28.8 million compared to $23.1 million for
the quarter ended June 30, 2016.
- Distributable cash flow for the quarter
ended June 30, 2017 was $24.5 million compared to $18.1 million for
the quarter ended June 30, 2016.
- The distribution declared per limited
partner unit was $0.74 per unit for the quarter ended June 30, 2017
compared to $0.69 per unit for the quarter ended June 30,
2016.
- We paid aggregate distributions of
$15.1 million for the quarter ended June 30, 2017, resulting in a
quarterly distribution coverage ratio of 1.62x.
RECENT DEVELOPMENTS
Expansion of the Collins bulk storage terminal. We
previously entered into long-term terminaling services agreements
with various parties for approximately 2.0 million barrels of new
storage capacity at our Collins, Mississippi bulk storage terminal.
The revenue associated with these agreements came on-line upon
completion of the construction of the new tank capacity. We placed
the 2.0 million barrels of new tank capacity into service in
various stages beginning in the fourth quarter of 2016 through the
second quarter of 2017. The anticipated aggregate cost of the 2.0
million barrels of new capacity is approximately $75 million.
Construction of the Collins expansion project commenced in the
first quarter of 2016, and we have spent approximately $58 million
as of June 30, 2017. While the new storage capacity has been placed
into service and is generating revenue, completion of certain items
associated with the new storage capacity remains and will be
completed over the next two quarters.
Our Collins/Purvis terminal complex is strategically located for
the bulk storage market and is the only independent terminal
capable of receiving from, delivering to, and transferring refined
petroleum products between the Colonial and Plantation pipeline
systems. Our facility has current active storage capacity of
approximately 5.4 million barrels. We have obtained an air permit
for an additional 5.0 million barrels of capacity for future
construction at our Collins terminal and are in active discussions
with several prospective customers regarding this potential future
capacity.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 2017 our outstanding borrowings on our $600 million
revolving credit facility were $302 million. For the trailing
twelve months, our Consolidated EBITDA was $105.1 million,
resulting in a debt to Consolidated EBITDA ratio of 2.87x.
For the second quarter 2017 we reported $19.1 million in total
capital expenditures, $10 million of which was in our Southeast
terminals segment associated with our Collins terminal expansion.
As of June 30, 2017 the remaining expenditures for approved
projects are estimated to be approximately $20 million. Approved
expenditures primarily include the remaining construction costs
associated with the expansion at our Collins terminal, as further
discussed above. We expect to fund our investment and expansion
expenditures with additional borrowings under our revolving credit
facility.
QUARTERLY DISTRIBUTION
The Partnership previously announced that it declared a
distribution of $0.74 per unit for the period from April 1, 2017
through June 30, 2017. This $0.015 increase over the previous
quarter reflects the seventh consecutive increase in the
distribution and represents annual growth of 7.2% over the prior
year second quarter. This distribution was paid on August 8, 2017
to unitholders of record on July 31, 2017.
CONFERENCE CALL
On Tuesday, August 8, 2017 the Partnership will hold a
conference call for analysts and investors at 1:00 p.m. Eastern
Time to discuss our second quarter 2017 results. Hosting the call
will be Fred Boutin, Chief Executive Officer and Rob Fuller, Chief
Financial Officer. The call can be accessed live over the telephone
by dialing (877) 407-4018, or for international callers, (201)
689-8471. A replay will be available shortly after the call and can
be accessed by dialing (844) 512-2921, or for international callers
(412) 317-6671. The passcode for the replay is 13668127. The replay
will be available until August 22, 2017.
Interested parties may also listen to a simultaneous webcast of
the conference call by logging onto TLP’s website at
www.transmontaignepartners.com under the Investor Information
section. A replay of the webcast will also be available for
approximately seven days following the call.
ABOUT TRANSMONTAIGNE PARTNERS L.P.
TransMontaigne Partners L.P. is a terminaling and transportation
company based in Denver, Colorado with operations in the United
States along the Gulf Coast, in the Midwest, in Houston and
Brownsville, Texas, along the Mississippi and Ohio Rivers and in
the Southeast. We provide integrated terminaling, storage,
transportation and related services for customers engaged in the
distribution and marketing of light refined petroleum products,
heavy refined petroleum products, crude oil, chemicals, fertilizers
and other liquid products. Light refined products include
gasolines, diesel fuels, heating oil and jet fuels. Heavy refined
products include residual fuel oils and asphalt. We do not purchase
or market products that we handle or transport. News and additional
information about TransMontaigne Partners L.P. is available on our
website: www.transmontaignepartners.com.
FORWARD-LOOKING STATEMENTS
This press release includes statements that may constitute
forward looking statements made pursuant to the safe harbor
provision of the Private Securities Litigation Reform Act of 1995.
Although the company believes that the expectations reflected in
such forward looking statements are based on reasonable
assumptions, such statements are subject to risks and uncertainties
that could cause actual results to differ materially from those
projected. Among the key risk factors that could negatively impact
our assumptions on future growth prospects and acquisitions
include, without limitation, (i) our ability to identify suitable
growth projects or acquisitions; (ii) our ability to complete
identified projects and acquisitions timely and at expected costs,
(iii) competition for acquisition opportunities, and (iv) the
successful integration and performance of acquired assets or
businesses and the risks of operating assets or businesses that are
distinct from our historical operations. Key risk factors
associated with the Collins terminal expansion include, without
limitation: (i) the ability to complete construction of the project
on time and at expected costs; (ii) the ability to obtain required
permits and other approvals on a timely basis; (iii) disruption in
the debt and equity markets that negatively impacts the
Partnership’s ability to finance capital spending, (iv) the
occurrence of operational hazards, weather related events or
unforeseen interruption; and (v) the failure of our customers or
vendors to satisfy or continue contractual obligations. Additional
important factors that could cause actual results to differ
materially from the Partnership’s expectations and may adversely
affect its business and results of operations are disclosed in
"Item 1A. Risk Factors" in the Partnership’s Annual Report on Form
10-K for the year ended December 31, 2016, filed with the
Securities and Exchange Commission on March 14, 2017. The forward
looking statements speak only as of the date made, and, other than
as may be required by law, the Partnership undertakes no obligation
to update or revise any forward looking statements, whether as a
result of new information, future events or otherwise.
ATTACHMENT ASELECTED FINANCIAL INFORMATION AND RESULTS
OF OPERATIONS
Our terminaling services agreements are structured as either
throughput agreements or storage agreements. Most of our throughput
agreements contain provisions that require our customers to
throughput a minimum volume of product at our facilities over a
stipulated period of time, which results in a minimum amount of
revenue. Our storage agreements require our customers to make
minimum payments based on the volume of storage capacity made
available to the customer under the agreement, which also results
in a minimum amount of revenue. We refer to these minimum amounts
of revenue recognized pursuant to our terminaling services
agreements as being “firm commitments.” Revenue recognized in
excess of firm commitments and revenue recognized based solely on
the volume of product distributed or injected are referred to as
“variable.” Our revenue was as follows (in thousands):
Three months ended Six months ended June 30,
June 30, 2017 2016 2017 2016
Terminaling services fees: Firm commitments $ 33,669 $ 28,507 $
65,733 $ 56,860 Variable 2,780 2,577 5,850
5,326 Total terminaling services fees 36,449 31,084 71,583
62,186 Pipeline transportation fees 1,796 1,893 3,512 3,334
Management fees and reimbursed costs 2,062 2,003 4,452 4,220 Other
5,057 6,156 10,667 12,022 Total revenue
$ 45,364 $ 41,136 $ 90,214 $ 81,762
The amount of revenue recognized as “firm commitments” based on
the remaining contractual term of the terminaling services
agreements that generated “firm commitments” for the three months
ended June 30, 2017 was as follows (in thousands):
Remaining terms on terminaling services agreements
that generated “firm commitments”: Less than 1 year remaining $
4,735 14 % 1 year or more, but less than 3 years remaining 7,741 23
% 3 years or more, but less than 5 years remaining 12,787 38 % 5
years or more remaining 8,406 25 % Total firm commitments
for the three months ended June 30, 2017 $ 33,669
The following selected financial information is extracted from
our quarterly report on Form 10-Q for the quarter ended June 30,
2017, which was filed on August 8, 2017 with the Securities and
Exchange Commission (in thousands, except per unit amounts):
Three
months ended Six months ended June 30, June
30, 2017 2016 2017
2016
Income Statement
Data
Revenue $ 45,364 $ 41,136 $ 90,214 $ 81,762 Direct operating costs
and expenses (15,984 ) (17,703 ) (32,495 ) (33,609 ) General and
administrative expenses (4,080 ) (3,446 ) (8,051 ) (7,324 )
Earnings from unconsolidated affiliates 2,120 2,130 4,680 3,980
Operating income 17,274 12,883 32,674 24,590 Net earnings 14,478
10,310 27,432 19,020 Net earnings allocable to limited partners
11,373 8,068 21,484 14,722 Net earnings per limited partner
unit—basic $ 0.70 $ 0.50 $ 1.32 $ 0.91
June
30, December 31, 2017 2016
Balance Sheet
Data
Property, plant and equipment, net $ 425,875 $ 416,748 Investments
in unconsolidated affiliates 239,023 241,093 Goodwill 8,485 8,485
Total assets 700,947 689,694 Long-term debt 302,000 291,800
Partners’ equity 373,273 372,734
Selected results of operations data for each of the quarters in
the years ended December 31, 2017 and 2016 are summarized
below (in thousands):
Three months ended
Year ending March 31, June 30, September
30, December 31, December 31, 2017
2017 2017 2017 2017 Revenue $ 44,850 $
45,364 $ — $ — $ 90,214 Direct operating costs and expenses (16,511
) (15,984 ) — — (32,495 ) General and administrative expenses
(3,971 ) (4,080 ) — — (8,051 ) Insurance expenses (1,006 ) (1,002 )
— — (2,008 ) Equity-based compensation expense (1,817 ) (352 ) — —
(2,169 ) Depreciation and amortization (8,705 ) (8,792 ) — —
(17,497 ) Earnings from unconsolidated affiliates 2,560
2,120 — — 4,680
Operating income
15,400 17,274 — — 32,674 Other expenses (2,446 )
(2,796 ) — — (5,242 ) Net earnings $ 12,954
$ 14,478 $ — $ — $ 27,432
Three months ended Year ending
March 31, June 30, September 30, December
31, December 31, 2016 2016 2016
2016 2016 Revenue $ 40,626 $ 41,136 $ 40,638 $ 42,524
$ 164,924 Direct operating costs and expenses (15,906 ) (17,703 )
(17,048 ) (17,758 ) (68,415 ) General and administrative expenses
(3,878 ) (3,446 ) (3,605 ) (3,171 ) (14,100 ) Insurance expenses
(895 ) (912 ) (969 ) (1,305 ) (4,081 ) Equity-based compensation
expense (2,155 ) (258 ) (251 ) (599 ) (3,263 ) Depreciation and
amortization (7,935 ) (8,064 ) (8,169 ) (8,215 ) (32,383 ) Earnings
from unconsolidated affiliates 1,850 2,130
2,960 3,089 10,029
Operating income 11,707 12,883 13,556 14,565 52,711 Other expenses
(2,997 ) (2,573 ) (1,671 ) (1,364 )
(8,605 ) Net earnings $ 8,710 $ 10,310 $
11,885 $ 13,201 $ 44,106
ATTACHMENT BDISTRIBUTABLE CASH FLOW
The following summarizes our distributable cash flow for the
period indicated (in thousands):
April 1, 2017 January
1, 2017 through through June 30, 2017
June 30, 2017 Net earnings $ 14,478 $ 27,432 Depreciation
and amortization 8,792 17,497 Earnings from unconsolidated
affiliates (2,120 ) (4,680 ) Distributions from unconsolidated
affiliates 4,546 8,895 Equity-based compensation expense 352 2,169
Settlement of tax withholdings on equity-based compensation (25 )
(407 ) Interest expense 2,525 4,677 Amortization of deferred
financing costs 271 565 “Consolidated
EBITDA” 1 28,819 56,148 Interest expense (2,525 ) (4,677 )
Unrealized loss (gain) on derivative instruments 38 (220 )
Amortization of deferred financing costs (271 ) (565 ) Amounts due
under long-term terminaling services agreements, net (227 ) (325 )
Project amortization of deferred revenue under GAAP (104 ) (155 )
Project amortization of deferred revenue for DCF 503 955
Capitalized maintenance (1,783 ) (3,245 )
“Distributable cash flow”, or DCF, generated during the period 1 $
24,450 $ 47,916
Actual distribution for the period on all
common units and the general partnerinterest including incentive
distribution rights
$ 15,077 $ 29,669 Distribution coverage ratio 1
1.62x 1.62x 1
Distributable cash flow, the distribution coverage ratio and
Consolidated EBITDA are not computations based upon generally
accepted accounting principles. The amounts included in the
computations of our distributable cash flow and Consolidated EBITDA
are derived from amounts separately presented in our consolidated
financial statements, notes thereto and “Item 2. Management's
Discussion and Analysis of Financial Condition and Results of
Operations” in our quarterly report on Form 10-Q for the quarter
ended June 30, 2017, which was filed with the Securities and
Exchange Commission on August 8, 2017. Distributable cash flow and
Consolidated EBITDA should not be considered in isolation or as an
alternative to net earnings or operating income, as an indication
of our operating performance, or as an alternative to cash flows
from operating activities as a measure of liquidity. Distributable
cash flow and Consolidated EBITDA are not necessarily comparable to
similarly titled measures of other companies. Distributable cash
flow and Consolidated EBITDA are presented here because they are
widely accepted financial indicators used to compare partnership
performance. Further, Consolidated EBITDA is calculated consistent
with the provisions of our credit facility and is a financial
performance measure used in the calculation of our leverage ratio
requirement. We believe that these measures provide investors an
enhanced perspective of the operating performance of our assets,
the cash we are generating and our ability to make distributions to
our unitholders and our general partner.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170808005784/en/
TransMontaigne Partners L.P.Frederick W. Boutin,
303-626-8200Chief Executive OfficerorRobert T. Fuller,
303-626-8200Chief Financial Officer
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