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8-K - CURRENT REPORT OF MATERIAL EVENTS OR CORPORATE CHANGES - NGL Energy Partners LPa14-14337_18k.htm

Exhibit 99.1

 

NGL Energy Partners LP Announces Fiscal 2014 Results

TULSA, Okla., — (BUSINESS WIRE) —

 

NGL Energy Partners LP (NYSE:NGL) today reported Adjusted EBITDA of $270.5 million for the year ended March 31, 2014 (exclusive of $6.9 million of advisory and legal costs related to acquisitions plus $8.2 million of severance and compensation costs related to the Gavilon transaction), compared to Adjusted EBITDA of $183.5 million during the year ended March 31, 2013 (exclusive of $5.6 million of advisory and legal costs related to acquisitions). NGL reported net income of $48.8 million for the year ended March 31, 2014, compared to net income of $48.2 million for the year ended March 31, 2013. Net income per limited partner common unit for the year ended March 31, 2014 was $0.51, compared to net income per limited partner common unit of $0.96 for the year ended December 31, 2013.

 

NGL’s accomplishments during fiscal 2014 included the following:

 

·                  The acquisition of the diversified midstream energy business of Gavilon Energy, LLC in December 2013, which added 7.7 million barrels of storage at Cushing, OK and a 50% interest in the Glass Mountain pipeline;

 

·                  Amendments to NGL’s revolving credit facility in November and December 2013 that expanded the capacity to $1.721 billion, extended the maturity date to late 2018, and reduced interest costs; and

 

·                  First issue of senior unsecured notes in the amount of $450 million in a private placement in October 2013.

 

A conference call to discuss NGL’s results of operations is scheduled for 11:00am Eastern Time (10:00am Central Time) on May 30, 2014. Analysts, investors, and other interested parties may access the conference call by dialing (800) 706-7741 and providing access code 55877851. An archived audio replay of the conference call will be available for 7 days beginning at 4:30pm Eastern Time (3:30pm Central Time) on May 30, 2014 and can be accessed by dialing (888) 286-8010 and providing access code 45965561.

 

NGL defines EBITDA as net income attributable to parent equity, plus income taxes, interest expense, loss on early extinguishment of debt, and depreciation and amortization expense. NGL defines Adjusted EBITDA as EBITDA excluding the unrealized gain or loss on derivative contracts, the gain or loss on the disposal or impairment of assets, and share-based compensation expense. For purposes of NGL’s Adjusted EBITDA calculation, NGL draws a distinction between unrealized gains and losses on derivatives and realized gains and losses on derivatives. During the period when a derivative contract is open, NGL records changes in the fair value of the derivative as unrealized gains or losses.  When a derivative contract is settled, NGL reverses the previously-recorded unrealized gain or loss and records a realized gain or loss.  The realized gain or loss is equal to the amount received or paid on the contract.  NGL acquired Gavilon Energy in December 2013.  NGL is still in the process of developing procedures to calculate realized and unrealized gains and losses for the Gavilon Energy operations in the same way NGL calculates them for its other operations.  Accordingly, the unrealized gain and loss in the Adjusted EBITDA table below excludes any unrealized gains and losses related to Gavilon Energy.

 

EBITDA and Adjusted EBITDA should not be considered an alternative to net income, income before income taxes, cash flows from operating activities, or any other measure of financial performance calculated in accordance with GAAP as those items are used to measure operating performance,

 



 

liquidity or the ability to service debt obligations. NGL believes that EBITDA provides additional information for evaluating its ability to make quarterly distributions to its unitholders and is presented solely as a supplemental measure. NGL believes that Adjusted EBITDA provides additional information for evaluating its financial performance without regard to its financing methods, capital structure and historical cost basis. Further, EBITDA and Adjusted EBITDA, as NGL defines them, may not be comparable to EBITDA and Adjusted EBITDA or similarly titled measures used by other entities. A reconciliation of Adjusted EBITDA to net income attributable to parent equity is shown below.

 

This press release includes “forward-looking statements.” All statements other than statements of historical facts included or incorporated herein may constitute forward-looking statements. Actual results could vary significantly from those expressed or implied in such statements and are subject to a number of risks and uncertainties. While NGL believes its expectations as reflected in the forward-looking statements are reasonable, NGL can give no assurance that such expectations will prove to be correct. The forward-looking statements involve risks and uncertainties that affect operations, financial performance, and other factors as discussed in filings with the Securities and Exchange Commission. Other factors that could impact any forward-looking statements are those risks described in NGL’s annual report on Form 10-K, quarterly reports on Form 10-Q, and other public filings. You are urged to carefully review and consider the cautionary statements and other disclosures made in those filings, specifically those under the heading “Risk Factors”. NGL undertakes no obligation to publicly update or revise any forward-looking statements except as required by law.

 

About NGL Energy Partners LP

 

NGL Energy Partners LP is a Delaware limited partnership. NGL owns and operates a vertically integrated energy business with four primary businesses: water solutions, crude oil logistics, NGL liquids and retail propane. NGL completed its initial public offering in May 2011. For further information visit the Partnership’s website at www.nglenergypartners.com.

 



 

NGL ENERGY PARTNERS LP

Consolidated Balance Sheets

At March 31, 2014 and 2013

(U.S. Dollars in Thousands, except unit amounts)

 

 

 

March 31,

 

 

 

2014

 

2013

 

ASSETS

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

Cash and cash equivalents

 

$

10,440

 

$

11,561

 

Accounts receivable - trade, net of allowance for doubtful accounts of $2,822 and $1,760, respectively

 

900,904

 

562,757

 

Accounts receivable - affiliates

 

7,445

 

22,883

 

Inventories

 

310,160

 

126,895

 

Prepaid expenses and other current assets

 

80,350

 

37,891

 

Total current assets

 

1,309,299

 

761,987

 

 

 

 

 

 

 

PROPERTY, PLANT AND EQUIPMENT, net of accumulated depreciation of $109,564 and $50,127, respectively

 

829,346

 

526,437

 

GOODWILL

 

1,107,006

 

555,220

 

INTANGIBLE ASSETS, net of accumulated amortization of $116,728 and $44,155, respectively

 

714,956

 

441,432

 

INVESTMENTS IN UNCONSOLIDATED ENTITIES

 

189,821

 

 

OTHER NONCURRENT ASSETS

 

16,795

 

6,542

 

Total assets

 

$

4,167,223

 

$

2,291,618

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

Accounts payable - trade

 

$

740,211

 

$

536,055

 

Accounts payable - affiliates

 

76,846

 

6,900

 

Accrued expenses and other payables

 

141,690

 

85,606

 

Advance payments received from customers

 

29,965

 

22,372

 

Current maturities of long-term debt

 

7,080

 

8,626

 

Total current liabilities

 

995,792

 

659,559

 

 

 

 

 

 

 

LONG-TERM DEBT, net of current maturities

 

1,629,834

 

740,436

 

OTHER NONCURRENT LIABILITIES

 

9,744

 

2,205

 

 

 

 

 

 

 

COMMITMENTS AND CONTINGENCIES

 

 

 

 

 

 

 

 

 

 

 

EQUITY

 

 

 

 

 

General partner, representing a 0.1% interest, 79,420 and 53,676 notional units at March 31, 2014 and 2013, respectively

 

(45,287

)

(50,497

)

Limited partners, representing a 99.9% interest -

 

 

 

 

 

Common units, 73,421,309 and 47,703,313 units issued and outstanding at March 31, 2014 and 2013, respectively

 

1,570,074

 

920,998

 

Subordinated units, 5,919,346 units issued and outstanding at March 31, 2014 and 2013

 

2,028

 

13,153

 

Accumulated other comprehensive income (loss)

 

(236

)

24

 

Noncontrolling interests

 

5,274

 

5,740

 

Total equity

 

1,531,853

 

889,418

 

Total liabilities and equity

 

$

4,167,223

 

$

2,291,618

 

 



 

NGL ENERGY PARTNERS LP

Consolidated Statements of Operations

For the Years Ended December 31, 2014, 2013 and 2012

 (U.S. Dollars in Thousands, except unit and per unit amounts)

 

 

 

Year Ended March 31,

 

 

 

2014

 

2013

 

2012

 

REVENUES:

 

 

 

 

 

 

 

Crude oil logistics

 

$

4,558,545

 

$

2,316,288

 

$

 

Water solutions

 

143,100

 

62,227

 

 

Liquids

 

2,650,425

 

1,604,746

 

1,111,139

 

Retail propane

 

551,815

 

430,273

 

199,334

 

Refined products

 

1,180,895

 

 

 

Renewables

 

176,781

 

 

 

Other

 

437,713

 

4,233

 

 

Total Revenues

 

9,699,274

 

4,417,767

 

1,310,473

 

 

 

 

 

 

 

 

 

COST OF SALES:

 

 

 

 

 

 

 

Crude oil logistics

 

4,477,397

 

2,244,647

 

 

Water solutions

 

11,738

 

5,611

 

 

Liquids

 

2,518,099

 

1,530,459

 

1,086,881

 

Retail propane

 

354,676

 

258,393

 

130,142

 

Refined products

 

1,172,754

 

 

 

Renewables

 

171,422

 

 

 

Other

 

426,613

 

 

 

Total Cost of Sales

 

9,132,699

 

4,039,110

 

1,217,023

 

 

 

 

 

 

 

 

 

OPERATING COSTS AND EXPENSES:

 

 

 

 

 

 

 

Operating

 

259,396

 

169,799

 

47,300

 

General and administrative

 

79,860

 

52,698

 

16,009

 

Depreciation and amortization

 

120,754

 

68,853

 

15,111

 

Operating Income

 

106,565

 

87,307

 

15,030

 

 

 

 

 

 

 

 

 

OTHER INCOME (EXPENSE):

 

 

 

 

 

 

 

Earnings of unconsolidated entities

 

1,898

 

 

 

Interest expense

 

(58,854

)

(32,994

)

(7,620

)

Loss on early extinguishment of debt

 

 

(5,769

)

 

Other, net

 

86

 

1,521

 

1,055

 

Income Before Income Taxes

 

49,695

 

50,065

 

8,465

 

 

 

 

 

 

 

 

 

INCOME TAX PROVISION

 

(937

)

(1,875

)

(601

)

 

 

 

 

 

 

 

 

Net Income

 

48,758

 

48,190

 

7,864

 

 

 

 

 

 

 

 

 

NET INCOME ALLOCATED TO GENERAL PARTNER

 

(14,148

)

(2,917

)

(8

)

 

 

 

 

 

 

 

 

NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS

 

(1,103

)

(250

)

12

 

 

 

 

 

 

 

 

 

NET INCOME ALLOCATED TO LIMITED PARTNERS

 

$

33,507

 

$

45,023

 

$

7,868

 

 

 

 

 

 

 

 

 

BASIC AND DILUTED INCOME PER COMMON UNIT

 

$

0.51

 

$

0.96

 

$

0.32

 

 

 

 

 

 

 

 

 

BASIC AND DILUTED INCOME PER SUBORDINATED UNIT

 

$

0.32

 

$

0.93

 

$

0.58

 

 

 

 

 

 

 

 

 

BASIC AND DILUTED WEIGHTED AVERAGE UNITS OUTSTANDING:

 

 

 

 

 

 

 

Common units

 

61,970,471

 

41,353,574

 

15,169,983

 

Subordinated units

 

5,919,346

 

5,919,346

 

5,175,384

 

 



 

ADJUSTED EBITDA RECONCILIATION

 

The following table reconciles net income attributable to parent equity to EBITDA and Adjusted EBITDA, each of which are non-GAAP financial measures, for the periods indicated:

 

 

 

Year Ended March 31,

 

 

 

2014

 

2013

 

2012

 

 

 

(in thousands)

 

Net income attributable to parent equity

 

$

47,655

 

$

47,940

 

$

7,876

 

Income tax provision

 

937

 

1,875

 

601

 

Interest expense

 

58,871

 

32,994

 

7,620

 

Loss on early extinguishment of debt

 

 

5,769

 

 

Depreciation and amortization

 

127,821

 

73,739

 

15,911

 

EBITDA

 

235,284

 

162,317

 

32,008

 

Unrealized (gain) loss on derivative contracts

 

(1,327

)

5,275

 

4,384

 

Loss (gain) on disposal or impairment of assets

 

3,597

 

187

 

(71

)

Share-based compensation expense

 

17,804

 

10,138

 

 

Adjusted EBITDA

 

$

255,358

 

$

177,917

 

$

36,321

 

 

SOURCE: NGL Energy Partners LP

 

NGL Energy Partners LP
Atanas H. Atanasov, 918-481-1119
Chief Financial Officer and Treasurer
atanas.atanasov@nglep.com