News Release
NuStar Energy Reports Earnings Results for Fourth Quarter and Full Year 2012
Quarterly Distribution Remains at
Transportation Segment Continues to Benefit from NuStar’s Growth
in the
Expect to Close on Second Phase of TexStar Acquisition in
Earnings before interest, taxes, depreciation and amortization (EBITDA)
from continuing operations were
The company reported a fourth quarter net loss applicable to limited
partners of
The partnership also announced that its board of directors has declared
a fourth quarter 2012 distribution of
“2012 was a critical transition year for our company as we made a lot of
tough decisions that put NuStar on the right track for the future,” said
The fourth quarter 2012 results include
In addition to those fourth quarter expense items, results for the year
ended
2012 Segment Results
“Our transportation segment continues to perform better than last year
as we benefit from higher throughputs related to internal growth capital
projects completed in the
In regard to the 2012 performance of the company’s storage segment
Anastasio said, “While full-year results were higher than 2011’s
results, the increased earnings associated with internal growth projects
completed in 2011 and 2012, primarily at the
Addressing the performance of the asphalt and fuels marketing segment,
Anastasio went on to say, “Due to the third quarter 2012 sale of 50% of
our asphalt operations and the
TexStar Acquisition Update
“Integration of the crude oil assets acquired from
2013 Outlook
Commenting on the earnings outlook for 2013, Anastasio said, “We expect
the EBITDA results for all three of our segments to improve compared to
last year. Our transportation segment should benefit from two Eagle Ford
internal growth pipeline projects completed in 2012 and the crude oil
assets acquired from
Anastasio went on to say, “We expect our asphalt and fuels marketing segment's 2013 results to improve compared to 2012, primarily due to higher earnings in the bunkering and heavy fuel oil businesses.”
With regard to capital spending projections Anastasio added, “NuStar
expects to spend
A conference call with management is scheduled for
This release serves as qualified notice to nominees under Treasury
Regulation Sections 1.1446-4(b)(4) and (d). Please note that 100% of
NuStar’s distributions to foreign investors are attributable to income
that is effectively connected with a
Cautionary Statement Regarding Forward-Looking Statements
This press release includes forward-looking statements regarding
future events. All forward-looking statements are based on the
partnership and company's beliefs as well as assumptions made by and
information currently available to the partnership and company. These
statements reflect the partnership and company's current views with
respect to future events and are subject to various risks, uncertainties
and assumptions. These risks, uncertainties and assumptions are
discussed in
NuStar Energy L.P. and Subsidiaries | ||||||||||||||||||||
Consolidated Financial Information | ||||||||||||||||||||
(Unaudited, Thousands of Dollars, Except Unit Data and Per Unit Data) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||||||
Statement of Income Data (Note 1): | ||||||||||||||||||||
Revenues: | ||||||||||||||||||||
Services revenues | $ | 233,653 | $ | 220,980 | $ | 880,097 | $ | 834,809 | ||||||||||||
Product sales | 751,114 | 1,603,425 | 5,075,579 | 5,437,006 | ||||||||||||||||
Total revenues | 984,767 | 1,824,405 | 5,955,676 | 6,271,815 | ||||||||||||||||
Costs and expenses: | ||||||||||||||||||||
Cost of product sales | 718,208 | 1,567,793 | 4,930,174 | 5,175,710 | ||||||||||||||||
Operating expenses | 141,116 | 138,035 | 542,764 | 524,654 | ||||||||||||||||
General and administrative expenses | 29,502 | 33,538 | 104,756 | 103,050 | ||||||||||||||||
Depreciation and amortization expense | 39,483 | 43,210 | 165,021 | 166,589 | ||||||||||||||||
Asset impairment loss | - | - | 249,646 | - | ||||||||||||||||
Goodwill impairment loss | - | - | 22,132 | - | ||||||||||||||||
Gain on legal settlement | - | - | (28,738 | ) | - | |||||||||||||||
Total costs and expenses | 928,309 | 1,782,576 | 5,985,755 | 5,970,003 | ||||||||||||||||
Operating income (loss) | 56,458 | 41,829 | (30,079 | ) | 301,812 | |||||||||||||||
Equity in (loss) earnings of joint ventures | (13,194 | ) | 4,461 | (9,378 | ) | 11,458 | ||||||||||||||
Interest expense, net | (21,552 | ) | (20,339 | ) | (89,670 | ) | (81,727 | ) | ||||||||||||
Other (expense) income, net | (5,119 | ) | 2,401 | (26,511 | ) | (3,343 | ) | |||||||||||||
Income (loss) from continuing operations | ||||||||||||||||||||
before income tax expense | 16,593 | 28,352 | (155,638 | ) | 228,200 | |||||||||||||||
Income tax expense | 2,176 | 3,568 | 22,494 | 16,713 | ||||||||||||||||
Income (loss) from continuing operations | 14,417 | 24,784 | (178,132 | ) | 211,487 | |||||||||||||||
(Loss) income from discontinued operations, net of income tax | (25,440 | ) | 5,415 | (49,105 | ) | 10,114 | ||||||||||||||
Net (loss) income | $ | (11,023 | ) | $ | 30,199 | $ | (227,237 | ) | $ | 221,601 | ||||||||||
Net (loss) income applicable to limited partners | $ | (21,212 | ) | $ | 19,782 | $ | (263,325 | ) | $ | 180,714 | ||||||||||
Net income (loss) per unit applicable to limited partners: | ||||||||||||||||||||
Continuing operations | $ | 0.05 | $ | 0.22 | $ | (2.95 | ) | $ | 2.63 | |||||||||||
Discontinued operations | (0.32 | ) | 0.08 | (0.66 | ) | 0.15 | ||||||||||||||
Total | $ | (0.27 | ) | $ | 0.30 | $ | (3.61 | ) | $ | 2.78 | ||||||||||
Weighted average limited partner units outstanding | 77,886,078 | 66,226,386 | 72,957,417 | 65,018,301 | ||||||||||||||||
EBITDA from continuing operations (Note 2) | $ | 77,628 | $ | 91,901 | $ | 99,053 | $ | 476,516 | ||||||||||||
Distributable cash flow from continuing operations (Note 2) | $ | 69,500 | $ | 71,140 | $ | 251,029 | $ | 348,649 | ||||||||||||
December 31, | ||||||||||||||||||||
2012 | 2011 | |||||||||||||||||||
Balance Sheet Data: | ||||||||||||||||||||
Debt, including current portion (a) | $ | 2,411,004 | $ | 2,293,030 | ||||||||||||||||
Partners' equity (b) | 2,584,995 | 2,864,335 | ||||||||||||||||||
Debt-to-capitalization ratio (a) / ((a)+(b)) | 48.3 | % | 44.5 | % |
NuStar Energy L.P. and Subsidiaries | ||||||||||||||||||||
Consolidated Financial Information - Continued | ||||||||||||||||||||
(Unaudited, Thousands of Dollars, Except Barrel Data) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||||||
Segment Data: | ||||||||||||||||||||
Storage: | ||||||||||||||||||||
Throughput (barrels/day) | 794,335 | 735,521 | 765,556 | 693,269 | ||||||||||||||||
Throughput revenues | $ | 27,933 | $ | 21,858 | $ | 95,612 | $ | 80,246 | ||||||||||||
Storage lease revenues | 120,557 | 126,705 | 500,030 | 486,525 | ||||||||||||||||
Total revenues | 148,490 | 148,563 | 595,642 | 566,771 | ||||||||||||||||
Operating expenses | 90,895 | 72,409 | 305,500 | 285,639 | ||||||||||||||||
Depreciation and amortization expense | 23,724 | 23,081 | 93,449 | 87,737 | ||||||||||||||||
Asset impairment loss | - | - | 2,126 | - | ||||||||||||||||
Segment operating income | $ | 33,871 | $ | 53,073 | $ | 194,567 | $ | 193,395 | ||||||||||||
Transportation: | ||||||||||||||||||||
Refined products pipelines throughput (barrels/day) | 520,796 | 528,818 | 498,321 | 514,261 | ||||||||||||||||
Crude oil pipelines throughput (barrels/day) | 402,813 | 355,627 | 345,648 | 317,427 | ||||||||||||||||
Total throughput (barrels/day) | 923,609 | 884,445 | 843,969 | 831,688 | ||||||||||||||||
Revenues | $ | 95,517 | $ | 85,043 | $ | 340,455 | $ | 311,514 | ||||||||||||
Operating expenses | 33,775 | 29,111 | 128,987 | 113,946 | ||||||||||||||||
Depreciation and amortization expense | 13,792 | 12,886 | 52,878 | 51,165 | ||||||||||||||||
Segment operating income | $ | 47,950 | $ | 43,046 | $ | 158,590 | $ | 146,403 | ||||||||||||
Asphalt and fuels marketing: | ||||||||||||||||||||
Product sales and other revenue | $ | 752,022 | $ | 1,607,320 | $ | 5,086,383 | $ | 5,455,659 | ||||||||||||
Cost of product sales | 725,549 | 1,573,702 | 4,957,100 | 5,205,574 | ||||||||||||||||
Gross margin | 26,473 | 33,618 | 129,283 | 250,085 | ||||||||||||||||
Operating expenses | 20,457 | 47,091 | 148,458 | 157,282 | ||||||||||||||||
Depreciation and amortization expense | 18 | 5,416 | 11,253 | 20,949 | ||||||||||||||||
Asset and goodwill impairment loss | - | - | 266,357 | - | ||||||||||||||||
Segment operating income (loss) | $ | 5,998 | $ | (18,889 | ) | $ | (296,785 | ) | $ | 71,854 | ||||||||||
Consolidation and intersegment eliminations: | ||||||||||||||||||||
Revenues | $ | (11,262 | ) | $ | (16,521 | ) | $ | (66,804 | ) | $ | (62,129 | ) | ||||||||
Cost of product sales | (7,341 | ) | (5,909 | ) | (26,926 | ) | (29,864 | ) | ||||||||||||
Operating expenses | (4,011 | ) | (10,576 | ) | (40,181 | ) | (32,213 | ) | ||||||||||||
Total | $ | 90 | $ | (36 | ) | $ | 303 | $ | (52 | ) | ||||||||||
Consolidated Information: | ||||||||||||||||||||
Revenues | $ | 984,767 | $ | 1,824,405 | $ | 5,955,676 | $ | 6,271,815 | ||||||||||||
Cost of product sales | 718,208 | 1,567,793 | 4,930,174 | 5,175,710 | ||||||||||||||||
Operating expenses | 141,116 | 138,035 | 542,764 | 524,654 | ||||||||||||||||
Depreciation and amortization expense | 37,534 | 41,383 | 157,580 | 159,851 | ||||||||||||||||
Asset and goodwill impairment loss | - | - | 268,483 | - | ||||||||||||||||
Segment operating income | 87,909 | 77,194 | 56,675 | 411,600 | ||||||||||||||||
General and administrative expenses | (29,502 | ) | (33,538 | ) | (104,756 | ) | (103,050 | ) | ||||||||||||
Other depreciation and amortization expense | (1,949 | ) | (1,827 | ) | (7,441 | ) | (6,738 | ) | ||||||||||||
Other asset impairment loss | - | - | (3,295 | ) | - | |||||||||||||||
Gain on legal settlement | - | - | 28,738 | - | ||||||||||||||||
Consolidated operating income (loss) | $ | 56,458 | $ | 41,829 | $ | (30,079 | ) | $ | 301,812 |
NuStar Energy L.P. and Subsidiaries | |||
Consolidated Financial Information - Continued | |||
(Unaudited, Thousands of Dollars, Except Per Unit Data) | |||
Notes: | |||
1. | The results of operations for the San Antonio Refinery and related assets have been reported as discontinued operations for all periods presented. | ||
2. | NuStar Energy L.P. utilizes two financial measures, EBITDA from continuing operations and distributable cash flow from continuing operations, which are not defined in United States generally accepted accounting principles. Management uses these financial measures because they are widely accepted financial indicators used by investors to compare partnership performance. In addition, management believes that these measures provide investors an enhanced perspective of the operating performance of the partnership's assets and the cash that the business is generating. Neither EBITDA from continuing operations nor distributable cash flow from continuing operations are intended to represent cash flows for the period, nor are they presented as an alternative to net income from continuing operations. They should not be considered in isolation or as substitutes for a measure of performance prepared in accordance with United States generally accepted accounting principles. | ||
The following is a reconciliation of income (loss) from continuing operations to EBITDA from continuing operations and distributable cash flow from continuing operations: |
Three Months Ended | Year Ended | |||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||||||
Income (loss) from continuing operations | $ | 14,417 | $ | 24,784 | $ | (178,132 | ) | $ | 211,487 | |||||||||||
Plus interest expense, net | 21,552 | 20,339 | 89,670 | 81,727 | ||||||||||||||||
Plus income tax expense | 2,176 | 3,568 | 22,494 | 16,713 | ||||||||||||||||
Plus depreciation and amortization expense | 39,483 | 43,210 | 165,021 | 166,589 | ||||||||||||||||
EBITDA from continuing operations | 77,628 | 91,901 | 99,053 | 476,516 | ||||||||||||||||
Less equity in loss (earnings) of joint ventures | 13,194 | (4,461 | ) | 9,378 | (11,458 | ) | ||||||||||||||
Less interest expense, net | (21,552 | ) | (20,339 | ) | (89,670 | ) | (81,727 | ) | ||||||||||||
Less reliability capital expenditures | (15,180 | ) | (6,147 | ) | (33,572 | ) | (44,339 | ) | ||||||||||||
Less income tax expense | (2,176 | ) | (3,568 | ) | (22,494 | ) | (16,713 | ) | ||||||||||||
Plus distributions from joint venture | - | 4,977 | 6,364 | 14,374 | ||||||||||||||||
Plus other non-cash items (a) | 13,304 | - | 287,981 | 5,093 | ||||||||||||||||
Mark-to-market impact on hedge transactions (b) | 4,282 | 8,777 | (6,011 | ) | 3,653 | |||||||||||||||
Contingent loss adjustment | - | - | - | 3,250 | ||||||||||||||||
Distributable cash flow from continuing operations | 69,500 | 71,140 | 251,029 | 348,649 | ||||||||||||||||
Distributable cash flow from continuing operations | ||||||||||||||||||||
attributable to noncontrolling interest | (344 | ) | 53 | (300 | ) | 441 | ||||||||||||||
Distributable cash flow from continuing operations | ||||||||||||||||||||
available to general partner | 12,766 | 11,598 | 48,728 | 42,956 | ||||||||||||||||
Distributable cash flow from continuing operations | ||||||||||||||||||||
available to limited partners | $ | 57,078 | $ | 59,489 | $ | 202,601 | $ | 305,252 | ||||||||||||
Distributable cash flow from continuing operations | ||||||||||||||||||||
per limited partner unit | $ | 0.73 | $ | 0.90 | $ | 2.77 | $ | 4.70 |
(a) | Other non-cash items for the year ended December 31, 2012 consist of (i) $271.8 million of long-lived asset impairment charges mainly related to our asphalt operations, including fixed assets, goodwill and intangible assets, (ii) a $21.6 million loss associated with the sale of 50% of our asphalt operations on September 28, 2012, (iii) $13.3 million in costs written off due to cancelled capital projects and leasehold improvements associated with the termination of the lease of our previous corporate headquarters building and (iv) an $18.7 million gain, net of tax, resulting from a legal settlement. | |
(b) | Distributable cash flow from continuing operations excludes the impact of unrealized mark-to-market gains and losses that arise from valuing certain derivative contracts, as well as the associated hedged inventory. The gain or loss associated with these contracts is realized in distributable cash flow from continuing operations when the contracts are settled. |
Source:
NuStar Energy, L.P., San Antonio
Investors, Chris Russell, Vice
President
Investor Relations: 210-918-3507
or
Media, Mary
Rose Brown, Executive Vice President,
Corporate Communications:
210-918-2314
Web site: http://www.nustarenergy.com