Attached files
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8-K - FORM 8-K - East Dubuque Nitrogen Partners, L.P. | d516049d8k.htm |
EX-99.2 - EX-99.2 - East Dubuque Nitrogen Partners, L.P. | d516049dex992.htm |
Exhibit 99.1
EBITDA is defined as net income plus interest expense and other financing costs, loss on debt extinguishment, loss on interest rate swaps, income tax expense and depreciation and amortization, net of interest income. We calculate cash available for distribution as used in this table as EBITDA plus acquisition costs and non-cash compensation expense, less maintenance capital expenditures to the extent not funded by capital proceeds, net interest expense and debt service and distribution of cash reserves for working capital needs. Adjusted EBITDA is defined as EBITDA plus acquisition costs, elimination of Agrifos LLC (Agrifos) corporate overhead and the impact of purchase accounting. EBITDA, Adjusted EBITDA and cash available for distribution are used as supplemental financial measures by management and by external users of our financial statements, such as investors and commercial banks, to assess:
| the financial performance of our assets without regard to financing methods, capital structure or historical cost basis; and |
| our operating performance and return on invested capital compared to those of other publicly traded limited partnerships and other public companies, without regard to financing methods and capital structure. |
EBITDA, Adjusted EBITDA and cash available for distribution should not be considered alternatives to net income, operating income, net cash provided by operating activities or any other measure of financial performance or liquidity presented in accordance with accounting principles generally accepted in the United States of America (GAAP). EBITDA, Adjusted EBITDA and cash available for distribution may have material limitations as performance measures because they exclude items that are necessary elements of our costs and operations. In addition, EBITDA, Adjusted EBITDA and cash available for distribution presented by other companies may not be comparable to our presentation because each company may define these terms differently.
The table below reconciles EBITDA and Adjusted EBITDA, which are a non-GAAP financial measures, to net income for the periods indicated below:
Historical | Pro Forma | |||||||||||||||||||||||||||||||||||
Year Ended December 31, |
Three Months Ended December 31, |
Fiscal Year Ended September 30, | December 31, | |||||||||||||||||||||||||||||||||
2012 | 2011 | 2011 | 2010 | 2011 | 2010 | 2009 | 2008 | 2012 | ||||||||||||||||||||||||||||
(unaudited, in thousands) | ||||||||||||||||||||||||||||||||||||
Net income |
$ | 107,003 | $ | 31,057 | $ | 10,455 | $ | 4,324 | $ | 24,926 | $ | 5,009 | 28,159 | 30,098 | $ | 105,506 | ||||||||||||||||||||
Add: |
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Interest income |
(45 | ) | (53 | ) | (14 | ) | (13 | ) | (51 | ) | (57 | ) | (190 | ) | (891 | ) | (46 | ) | ||||||||||||||||||
Interest expense |
1,469 | 12,788 | 1,947 | 2,912 | 13,752 | 9,859 | 8,481 | 2,747 | 7,277 | |||||||||||||||||||||||||||
Loss on debt extinguishment |
2,114 | 19,486 | 10,263 | 4,593 | 13,816 | 2,268 | | | | |||||||||||||||||||||||||||
Loss on interest rate swaps |
951 | | | | | | | | 951 | |||||||||||||||||||||||||||
Income tax expense |
303 | 14,643 | | 2,772 | 17,415 | 3,344 | 18,576 | 19,875 | 303 | |||||||||||||||||||||||||||
Depreciation and amortization |
12,460 | 10,706 | 3,287 | 2,601 | 10,020 | 10,544 | 8,683 | 8,552 | 18,574 | |||||||||||||||||||||||||||
Other(a) |
(232 | ) | (3 | ) | (3 | ) | | | | | | (1,232 | ) | |||||||||||||||||||||||
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EBITDA |
124,023 | 88,624 | 25,935 | 17,189 | 79,878 | 30,967 | 63,709 | 60,381 | 131,333 | |||||||||||||||||||||||||||
Plus: Acquisition costs(b) |
4,131 | | | | | | | | | |||||||||||||||||||||||||||
Plus: Elimination of Agrifos corporate overhead(c) |
| | | | | | | | 5,518 | |||||||||||||||||||||||||||
Plus: Impact of purchase accounting(d) |
3,140 | | | | | | | | 3,140 | |||||||||||||||||||||||||||
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Adjusted EBITDA |
131,294 | 88,624 | 25,935 | 17,189 | 79,878 | 30,967 | 63,709 | 60,381 | 139,991 |
(a) | For the year ended December 31, 2012, Other consists of a tax adjustment relating to a prior year. For the pro forma year ended December 31, 2012, Other consists of a gain on an insurance claim relating to our facility in Pasadena, Texas (the Pasadena Facility). |
(b) | Acquisition costs relate to expenses incurred by us in our acquisition of Agrifos (the Agrifos Acquisition). |
(c) | Elimination of Agrifos corporate overhead relates to expenses for the Sellers corporate office, which was not acquired by us in the Agrifos Acquisition. |
(d) | In accordance with GAAP, we stepped up the value of the finished goods inventory acquired as part of our acquisition of our Pasadena Facility to fair value on November 1, 2012. This step up in value on November 1, 2012, reduced the gross margin earned on the sale of this finished goods inventory in November and December 2012. We have added this margin back to our Adjusted EBITDA in order to reflect the profit margin that would have been earned in the normal course of business had we not been required to step up the value of the inventory to fair value. |
The table below reconciles cash available for distribution to EBITDA, both of which are non-GAAP financial measures, for the periods indicated below:
Historical | ||||
Year Ended December 31, 2012 |
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(in thousands, except per unit data) |
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EBITDA |
$ | 124,023 | ||
Plus: Acquisition costs |
4,131 | |||
Plus: Non-cash compensation expense |
2,827 | |||
Less: Maintenance capital expenditures |
(8,500 | ) | ||
Less: Net interest expense and debt service |
(1,446 | ) | ||
Plus: Distribution of cash reserves for working capital |
6,110 | |||
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Cash available for distribution |
$ | 127,145 | ||
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Cash available for distribution, per unit |
$ | 3.30 | ||
Common units outstanding |
38,529 |