- Acquired two terminal facilities on the
U.S. West Coast with approximately 5 million barrels of active
storage capacity, for approximately $277 million
- Announced that we will construct
870,000 barrels of a Collins Phase II buildout, supported by the
execution of a significant long-term, fee-based anchor agreement
with a third party for new storage capacity
- Achieved record levels of revenue,
EBITDA and distributable cash flow for the full year 2017
- Net earnings for the fourth quarter of
2017 totaled $10.1 million, compared to $13.2 million in the prior
year fourth quarter
- Consolidated EBITDA for the fourth
quarter of 2017 totaled $27.0 million, compared to $25.5 million in
the prior year fourth quarter
- Distributable cash flow for the fourth
quarter of 2017 totaled $19.1 million, compared to $19.3 million in
the prior year fourth quarter
- Distribution coverage for full year
2017 was 1.45x; leverage as of December 31, 2017 was 4.38x on an as
adjusted basis for the acquisition of the West Coast terminal
facilities
- Increased the quarterly cash
distribution for the ninth consecutive quarter to $0.77, reflecting
an 8.5% increase over prior year quarterly distribution
TransMontaigne Partners L.P. (NYSE:TLP) (the Partnership,
we, us, our) today announced fourth quarter and full year 2017
financial and operating results.
“Our business continues to perform extremely well, resulting in
record levels of revenue, EBITDA and distributable cash flow for
2017,” said Fred Boutin, Chief Executive Officer of TransMontaigne
Partners. “Our growth in 2017 was largely driven by the completion
of our fully-contracted $75 million Collins phase I expansion,
which added 2 million barrels of storage capacity at attractive
investment returns. Our performance and stable cash flows have
allowed us to provide strong and consistent growth in our quarterly
distribution, while maintaining a conservative distribution
coverage ratio of more than 1.4x for 2017. We are excited to have
completed the acquisition of the West Coast terminals in December;
strategically expanding our terminal footprint into the San
Francisco Bay Area refining complex and growing our base of
long-term fee-based cash flows. Additionally, we are excited to
announce a Phase II buildout of our Collins, Mississippi terminal,
supported by an anchor agreement for new capacity with a third
party customer. We remain committed to growth in our business over
the long-term, and we continue to execute on our expansion plans,
including growth through asset maximization, organic expansion
projects and potential acquisitions.”
FINANCIAL RESULTS
Revenue for the fourth quarter of 2017 totaled $47.6 million, an
increase of $5.1 million, or approximately 12%, compared to the
$42.5 million reported for the fourth quarter of 2016. Consolidated
EBITDA totaled $27.0 million for the fourth quarter of 2017,
representing an increase of $1.5 million, or approximately 5.9%,
compared to the $25.5 million reported for the fourth quarter of
2016. The improvement compared to the prior year was primarily
attributed to our Collins Phase I terminal expansion coming fully
on-line in 2017.
Our terminaling services agreements are structured as either
throughput agreements or storage agreements. Our throughput
agreements contain provisions that require our customers to make
minimum payments, which are based on contractually established
minimum volume of throughput of the customer’s product at our
facilities over a stipulated period of time. Due to this minimum
payment arrangement, we recognize a fixed amount of revenue from
the customer over a certain period of time, even if the customer
throughputs less than the minimum volume of product during that
period. In addition, if a customer throughputs a volume of product
exceeding the minimum volume, we would recognize additional revenue
on this incremental volume. Our storage agreements require our
customers to make minimum payments based on the volume of storage
capacity available to the customer under the agreement, which
results in a fixed amount of recognized revenue.
We refer to the fixed amount of revenue recognized pursuant to
our terminaling services agreements as being “firm commitments.”
With respect to the fourth quarter 2017, approximately 75% of our
total revenue was derived from terminaling services agreements that
contain firm commitments. As of December 31, 2017, approximately
66% of our terminaling services revenues for the fourth quarter of
2017 were generated from firm commitments with remaining terms of
three years or more.
An overview of our financial performance for the quarter ended
December 31, 2017 compared to the quarter ended December 31, 2016,
includes:
- Operating income for the quarter ended
December 31, 2017 was approximately $13.6 million compared to $14.6
million for the quarter ended December 31, 2016. Changes in the
primary components of operating income are as follows:
- Revenue increased approximately $5.1
million to $47.6 million due to increases in revenue at our Gulf
Coast, Midwest, and Southeast terminals of approximately $0.6
million, $0.2 million and $3.8 million, respectively, partially
offset by decreases in revenue at our Brownsville and River
terminals of approximately $1.1 million and $0.1 million,
respectively. The December 15, 2017 acquisition of the West Coast
terminals added approximately $1.7 million to revenue.
- Direct operating costs and expenses
decreased approximately $0.3 million to $17.5 million due to
decreases in Gulf Coast, Midwest, Brownsville, River and the
Southeast terminals of approximately $0.2 million, $0.1 million,
$0.3 million, $0.2 million and $0.1 million, respectively. The
acquisition of the West Coast terminals added approximately $0.6
million to expense.
- General and administrative expenses
increased approximately $3.0 million to $6.1 million primarily due
to costs associated with our pursuit of acquisition opportunities,
such as the West Coast terminals.
- Insurance expenses decreased
approximately $0.2 million to $1.1 million.
- Equity-based compensation expense
decreased approximately $0.3 million to $0.3 million.
- Depreciation and amortization expenses
increased approximately $1.4 million to $9.6 million.
- Earnings from unconsolidated affiliates
decreased approximately $2.6 million to $0.5 million due to lower
earnings associated with our investment in BOSTCO.
- Net earnings were $10.1 million for the
quarter ended December 31, 2017 compared to $13.2 million for the
quarter ended December 31, 2016. The decrease was principally due
to the changes in quarterly operating income discussed above and an
increase in interest expense of approximately $2.0 million. The
increase in interest expense is partially attributable to the
recognition of unrealized gains in determining the fair value of
our interest rate swap agreements. In the fourth quarter 2017 we
recognized unrealized gains of $0.1 million compared to unrealized
gains of $0.9 million in the fourth quarter 2016.
- Quarterly net earnings per limited
partner unit was $0.41 per unit for the quarter ended December 31,
2017 compared to $0.65 per unit for the quarter ended December 31,
2016.
- Consolidated EBITDA for the quarter
ended December 31, 2017 was $27.0 million compared to $25.5 million
for the quarter ended December 31, 2016.
- Distributable cash flow for the quarter
ended December 31, 2017 was $19.1 million compared to $19.3 million
for the quarter ended December 31, 2016.
- The distribution declared per limited
partner unit was $0.77 per unit for the quarter ended December 31,
2017 compared to $0.71 per unit for the quarter ended December 31,
2016.
- We paid aggregate distributions of
$16.1 million for the quarter ended December 31, 2017, resulting in
a quarterly distribution coverage ratio of 1.19x.
An overview of our financial performance for the year ended
December 31, 2017 compared to the year ended December 31,
2016, includes:
- Operating income for the year ended
December 31, 2017 was approximately $60.2 million compared to
$52.7 million for the year ended December 31, 2016. Changes in
the primary components of operating income are as follows:
- Revenue increased approximately $18.4
million to $183.3 million due to increases in revenue at the Gulf
Coast and Southeast terminals of approximately $6.2 million and
$17.1 million, respectively, partially offset by decreases in
revenue at the Midwest, Brownsville and River terminals of
approximately $0.2 million, $4.8 million and $1.6 million,
respectively. The December 15, 2017 acquisition of the West Coast
terminals added approximately $1.7 million to revenue.
- Direct operating costs and expenses
decreased approximately $0.7 million to $67.7 million due to
decreases in the Gulf Coast, Midwest, Brownsville and River
terminals of approximately $0.1 million, $0.4 million, $0.9 million
and $1.3 million, respectively, partially offset by an increase at
the Southeast terminals of approximately $1.4 million. The
acquisition of the West Coast terminals added approximately $0.6
million to expense.
- General and administrative expenses
increased approximately $5.3 million to $19.4 million primarily due
to costs associated with our pursuit of acquisition opportunities,
such as the West Coast terminals.
- Equity-based compensation expense
decreased approximately $0.3 million to $3.0 million.
- Depreciation and amortization expense
increased approximately $3.6 million to $36.0 million.
- Earnings from investments in
unconsolidated affiliates decreased approximately $2.9 million to
$7.1 million due to lower earnings associated with our investment
in BOSTCO.
- Net earnings were $48.5 million for the
year ended December 31, 2017 compared to $44.1 million for the
year ended December 31, 2016. The increase was principally due
to the changes in annual operating income discussed above and an
increase in interest expense of approximately $2.7 million.
- Annual net earnings per limited partner
unit was $2.20 per unit for the year ended December 31, 2017
compared to $2.14 per unit for the year ended December 31,
2016.
- Consolidated EBITDA for the year ended
December 31, 2017 was $108.5 million compared to $96.2 million
for the year ended December 31, 2016.
- Distributable cash flow for the year
ended December 31, 2017 was $88.7 million compared to $75.9
million for the year ended December 31, 2016.
- The distribution declared per limited
partner unit was $2.99 per unit for the year ended December 31,
2017 compared to $2.78 per unit for the year ended December 31,
2016.
- We paid aggregate distributions of
$61.3 million for the year ended December 31, 2017, resulting in an
annual distribution coverage ratio of 1.45x.
RECENT DEVELOPMENTS
West Coast terminals acquisition. On December 15,
2017, we acquired the West Coast terminals from a third party for a
total purchase price of approximately $276.8 million. The
purchase price reflects a less than ten times multiple of the
Partnership’s estimate of the 2018 EBITDA attributable to the West
Coast terminals based on current customer contracts and historical
and anticipated activity levels, revenues and operating costs. The
acquisition was financed with borrowings under our credit facility.
The West Coast terminals are two waterborne refined product and
crude oil terminals located in the San Francisco Bay Area refining
complex with a total of 64 storage tanks with approximately
5 million barrels of active storage capacity. The West Coast
terminals have access to domestic and international crude oil and
refined products markets through marine, pipeline, truck and rail
logistics capabilities. Pursuant to a new long-term terminaling
services agreement with a third party customer, we have begun the
construction of an additional 125,000 barrels of storage capacity
at one of the terminals.
Expansion of our Collins bulk storage terminal. Our
Collins/Purvis, Mississippi 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. We previously entered into long-term terminaling
services agreements with various customers for approximately 2
million barrels of new tank capacity at our Collins, terminal. The
revenue associated with these agreements came on-line upon
completion of the construction of the new tank capacity at various
stages beginning in the fourth quarter of 2016 through the second
quarter of 2017. The aggregate cost of the approximately 2 million
barrels of new tank capacity was approximately $75 million, with
expected annual cash returns in the high-teens. With the completion
of our Phase I expansion, our Collins/Purvis terminal complex has
current active storage capacity of approximately 5.4 million
barrels.
In addition to the Phase I expansion at our Collins terminal, in
the second half of 2017 we obtained an air permit for an additional
5 million barrels of capacity for a Phase II buildout. We have
started the design and buildout of 870,000 barrels of new storage
capacity supported by the execution of a new long-term, fee-based
terminaling services agreement with a third party customer, which
constitutes the beginning of a Phase II buildout. To facilitate our
further expansion of tankage at Collins, we also recently entered
into an agreement with Colonial Pipeline Company for significant
improvements to the Colonial Pipeline receipt and delivery
manifolds and our related receipt and delivery facilities. The
improvements will result in significant increased flexibility for
our Collins customers including the simultaneous receipt and
delivery of gasoline from and to Colonial’s Line 1 at full line
rates including the ability to receive and deliver segregated
batches at these rates; a dedicated and segregated line for the
receipt and delivery of distillates from and to Colonial’s Line 2;
and a dedicated and segregated line for the receipt and delivery of
jet fuel from and to Colonial’s Line 2. The anticipated cost of the
approximately 870,000 barrels of new storage capacity and our share
of the improvements to the pipeline connections is approximately
$55 million, with expected annual cash returns in the low-teens. We
are currently in active discussions with several other existing and
prospective customers regarding additional future capacity at our
Collins terminal.
Credit facility amendment. In connection with our West
Coast terminals acquisition, we entered into an amendment to our
revolving credit facility on December 14, 2017, which
increased the lender commitments under our revolving credit
facility from $600 million to $850 million.
Public offering of senior notes. On February 12, 2018,
the Partnership and TLP Finance Corp., our wholly owned subsidiary,
completed the sale of $300 million of 6.125% senior notes, issued
at par and due 2026 (the “Senior Notes”). The Senior Notes were
guaranteed on a senior unsecured basis by each of our wholly owned
subsidiaries that guarantee obligations under our revolving credit
facility. Net proceeds were used primarily to repay indebtedness
under our revolving credit facility.
LIQUIDITY AND CAPITAL RESOURCES
As of December 31, 2017, outstanding borrowings on our $850
million revolving credit facility were $593.2 million. For the
trailing twelve months, on an as adjusted basis for our acquisition
of the West Coast terminals, our Consolidated EBITDA was $135.4
million, resulting in a debt to Consolidated EBITDA ratio of 4.38x.
Consolidated EBITDA is a non-GAAP financial performance measure
used in the calculation of the leverage ratio requirement under our
revolving credit facility. See Attachment B hereto for a
reconciliation of Consolidated EBITDA to net earnings. See also
Attachment C hereto for a table showing the calculation of our
total leverage ratio and interest coverage ratio and a
reconciliation of Consolidated EBITDA to Cash flows provided by
operating activities.
For the fourth quarter of 2017, we reported $20.3 million in
total capital expenditures. As of December 31, 2017, remaining
expenditures for approved expansion projects are estimated to be
approximately $70 million. Approved expenditures primarily include
the construction costs associated with the expansion at our Collins
and West Coast terminals, as further discussed above.
QUARTERLY DISTRIBUTION
The Partnership previously announced that it declared a
distribution of $0.77 per unit for the period from October 1, 2017
through December 31, 2017. This $0.015 increase over the previous
quarter reflects the ninth consecutive increase in the quarterly
distribution and represents annual growth of 8.5% over the prior
year fourth quarter distribution. This distribution was paid on
February 8, 2018 to unitholders of record on January 31, 2018.
FILING OF ANNUAL REPORT ON FORM 10-K
TransMontaigne Partners L.P.’s Annual Report on Form 10-K was
filed with the Securities and Exchange Commission on March 15, 2018
and was simultaneously posted to our website:
www.transmontaignepartners.com. Unitholders may obtain a hard copy
of the Annual Report on Form 10-K containing the Partnership’s
complete audited financial statements for the year ended December
31, 2017 free of charge by contacting TransMontaigne Partners L.P.,
Attention: Investor Relations, 1670 Broadway, Suite 3100, Denver,
Colorado 80202 or phoning (303) 626-8200.
CONFERENCE CALL
On Thursday, March 15, 2018, the Partnership will hold a
conference call for analysts and investors at 12:00 p.m. (noon)
Eastern Time to discuss our fourth quarter and full year 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 13677624. The replay will be available until
March 29, 2018.
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 until March
29, 2018.
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, in the
Southeast and on the West Coast. 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, and
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 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 West
Coast terminals include, without limitation: (i) the successful
integration and performance of the acquired assets, (ii) adverse
changes in general economic or market conditions, and (iii)
competitive factors such as pricing pressures and the entry of new
competitors. Key risk factors associated with the Collins terminal
expansion and related improvements 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, 2017, filed with the Securities and Exchange
Commission on March 15, 2018. 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. Our throughput
agreements contain provisions that require our customers to make
minimum payments, which are based on contractually established
minimum volume of throughput of the customer’s product at our
facilities over a stipulated period of time. Due to this minimum
payment arrangement, we recognize a fixed amount of revenue from
the customer over a certain period of time, even if the customer
throughputs less than the minimum volume of product during that
period. In addition, if a customer throughputs a volume of product
exceeding the minimum volume, we would recognize additional revenue
on this incremental volume. Our storage agreements require our
customers to make minimum payments based on the volume of storage
capacity available to the customer under the agreement, which
results in a fixed amount of recognized revenue.
We refer to the fixed amount 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 “ancillary.” The majority of our
“ancillary” revenue is derived from fees we charge our customers to
inject additive compounds into product that the customer is storing
at our terminals. The “firm commitments” and “ancillary” revenue
included in terminaling services fees were as follows (in
thousands):
Three months ended Year ended
December 31, December 31, 2017 2016
2017 2016 Terminaling services fees: Firm commitments
$ 35,607 $ 30,207 $ 135,197 $ 116,341 Ancillary 2,292
2,405 10,347 9,749 Total terminaling services fees
37,899 32,612 145,544 126,090 Pipeline transportation fees 1,116
1,799 5,719 6,789 Management fees and reimbursed costs 2,372 2,284
9,202 8,844 Other 6,222 5,829 22,807
23,201 Total revenue $ 47,609 $ 42,524 $ 183,272 $ 164,924
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 December 31, 2017 was as follows (in thousands):
Remaining terms on terminaling services agreements that generated
“firm commitments”:
Less than 1 year remaining
$ 1,393 4% 1 year or more, but less than 3 years remaining 10,770
30% 3 years or more, but less than 5 years remaining 14,072 40% 5
years or more remaining 9,372 26% Total firm commitments for
the three months ended December 31, 2017 $ 35,607
The following selected financial information is extracted from
our Annual Report on Form 10-K for the year ended December 31,
2017, which was filed on March 15, 2018 with the Securities and
Exchange Commission (in thousands, except per unit amounts):
Three months ended Year ended
December 31, December 31, 2017 2016
2017 2016
Income Statement
Data
Revenue $ 47,609 $ 42,524 $ 183,272 $ 164,924 Direct operating
costs and expenses (17,486 ) (17,758 ) (67,700 ) (68,415 ) General
and administrative expenses (6,135 ) (3,171 ) (19,433 ) (14,100 )
Earnings from unconsolidated affiliates 507 3,089 7,071 10,029
Operating income 13,571 14,565 60,187 52,711 Net earnings 10,095
13,201 48,493 44,106 Net earnings allocable to limited partners
6,604 10,588 35,788 34,799 Net earnings per limited partner
unit—basic $ 0.41 $ 0.65 $ 2.20 $ 2.14
December 31, December 31, 2017
2016
Balance Sheet
Data
Property, plant and equipment, net $ 655,053 $ 416,748 Investments
in unconsolidated affiliates 233,181 241,093 Goodwill 9,428 8,485
Customer relationships, net 47,136 338 Total assets 987,003 689,694
Long-term debt 593,200 291,800 Partners’ equity 364,217 372,734
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 $
45,449 $ 47,609 $ 183,272 Direct operating costs and expenses
(16,511 ) (15,984 ) (17,719 ) (17,486 ) (67,700 ) General and
administrative expenses (3,971 ) (4,080 ) (5,247 ) (6,135 ) (19,433
) Insurance expenses (1,006 ) (1,002 ) (999 ) (1,057 ) (4,064 )
Equity-based compensation expense (1,817 ) (352 ) (544 ) (286 )
(2,999 ) Depreciation and amortization (8,705 ) (8,792 ) (8,882 )
(9,581 ) (35,960 ) Earnings from unconsolidated affiliates
2,560 2,120 1,884 507
7,071 Operating income 15,400 17,274 13,942
13,571 60,187 Interest expense (2,152 ) (2,525 ) (2,656 ) (3,140 )
(10,473 ) Amortization of deferred financing costs (294 )
(271 ) (320 ) (336 ) (1,221 ) Net
earnings $ 12,954 $ 14,478 $ 10,966 $ 10,095
$ 48,493
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 Interest expense (2,792 ) (2,368 ) (1,467 ) (1,160 )
(7,787 ) Amortization of deferred financing costs (205 )
(205 ) (204 ) (204 ) (818 ) 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):
October 1, 2017 January 1,
2017 through through December 31, 2017
December 31, 2017 Net earnings $ 10,095 $ 48,493
Depreciation and amortization 9,581 35,960 Earnings from
unconsolidated affiliates (507 ) (7,071 ) Distributions from
unconsolidated affiliates 4,032 17,128 Equity-based compensation
expense 286 2,999 Settlement of tax withholdings on equity-based
compensation — (711 ) Interest expense 3,140 10,473 Amortization of
deferred financing costs 336 1,221
Consolidated EBITDA (1)(2) 26,963 108,492 Permitted acquisition
credit 5,900 26,900 Consolidated EBITDA
for the total leverage ratio (1)(2) 32,863 135,392 Interest expense
(3,140 ) (10,473 ) Unrealized gain on derivative instruments (77 )
(232 ) Amortization of deferred financing costs (336 ) (1,221 )
Amounts due under long-term terminaling services agreements, net 3
450 Project amortization of deferred revenue under GAAP (278 ) (765
) Project amortization of deferred revenue for DCF 670 2,342
Capitalized maintenance (4,698 ) (9,935 ) Permitted acquisition
credit (5,900 ) (26,900 ) “Distributable cash flow”,
or DCF, generated during the period (2) $ 19,107 $ 88,658
Actual distribution for the period on all
common units and the general partnerinterest including incentive
distribution rights
$ 16,063 $ 61,303 Distribution coverage ratio (2)
1.19x 1.45x (1) Reflects the calculation of
Consolidated EBITDA in accordance with the definition for such
financial metric in our revolving credit facility. (2)
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 7. Management's
Discussion and Analysis of Financial Condition and Results of
Operations” in our Annual Report on Form 10-K for the year ended
December 31, 2017, which was filed with the Securities and Exchange
Commission on March 15, 2018. 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.
ATTACHMENT CCREDIT FACILITY FINANCIAL
COVENANTS
The primary financial covenants contained in our revolving
credit facility are (i) a total leverage ratio test (not to
exceed 5.25 to 1.0), (ii) a senior secured leverage ratio test
(not to exceed 3.75 to 1.0), and (iii) a minimum interest
coverage ratio test (not less than 3.0 to 1.0; however while any
Qualified Senior Notes are outstanding not less than 2.75 to 1.0).
These financial covenants are based on a non-GAAP, defined
financial performance measure within our revolving credit facility
known as “Consolidated EBITDA.”
The following provides the calculation of “total leverage ratio”
and “interest coverage ratio” as such terms are used in our
revolving credit facility for certain financial covenants (in
thousands, except ratios):
Twelve months Three months ended ended
March 31, June 30, September 30, December
31, December 31, 2017 2017 2017
2017 2017 Financial performance debt covenant
test: Consolidated EBITDA (1) $ 27,329 $ 28,819 $ 25,381 $
26,963 $ 108,492 Permitted acquisition credit (2) 7,000
7,000 7,000 5,900
26,900 Consolidated EBITDA for the total leverage
ratio (1) $ 34,329 $ 35,819 $ 32,381 $ 32,863 $ 135,392
Consolidated funded indebtedness $ 593,200
Total leverage
ratio 4.38
x
Consolidated EBITDA for the interest coverage ratio (1) $ 27,329 $
28,819 $ 25,381 $ 26,963 $ 108,492 Consolidated interest expense
(1)(3) $ 2,410 $ 2,487 $ 2,591 $ 3,217 $ 10,705
Interest
coverage ratio 10.13
x
Reconciliation of consolidated EBITDA
to cash flows provided by operating activities:
Consolidated EBITDA for the total leverage ratio (1) $ 34,329 $
35,819 $ 32,381 $ 32,863 $ 135,392 Permitted acquisition credit (2)
(7,000 ) (7,000 ) (7,000 ) (5,900 ) (26,900 ) Consolidated interest
expense (2,152 ) (2,525 ) (2,656 ) (3,140 ) (10,473 ) Unrealized
loss (gain) on derivative instruments (258 ) 38 65 (77 ) (232 )
Amortization of deferred revenue (51 ) 10 (170 ) (122 ) (333 )
Settlement of tax withholdings on equity-based compensation 382 25
304 — 711 Change in operating assets and liabilities 5,113
(342 ) 4,477 (3,709 )
5,539 Cash flows provided by operating activities $ 30,363
$ 26,025 $ 27,401 $ 19,915 $ 103,704
(1) Reflects the calculation of Consolidated
EBITDA and Consolidated interest expense in accordance with the
definition for such financial metrics in our revolving credit
facility. (2) Reflects a credit of $7.0 million per quarter
relating to the acquisition of the West Coast terminals, which
qualified as a “Permitted Acquisition” under the terms of our
revolving credit facility. For the three months ended December 31,
2017, such $7.0 million credit was reduced by approximately $1.1
million, which is the amount of actual Consolidated EBITDA we
recognized relating to the West Coast terminals following the
acquisition on December 15, 2017. (3) Consolidated interest
expense, used in the calculation of the interest coverage ratio,
excludes unrealized gains and losses recognized on our derivative
instruments.
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version on businesswire.com: http://www.businesswire.com/news/home/20180315005686/en/
TransMontaigne Partners L.P.Frederick W. Boutin,
303-626-8200Chief Executive OfficerorRobert T. Fuller,
303-626-8200Chief Financial Officer
Transmontaigne Partners L.P. Transmontaigne Partners L.P. Common Units Representing Limited Partner Interests (NYSE:TLP)
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