Attached files
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| 8-K - 8-K - NATURAL RESOURCE PARTNERS LP | a2015form8-k3rdqtrer.htm |
Exhibit 99.1
Natural Resource Partners L.P.
601 Jefferson St., Suite 3600, Houston, TX 77002
NEWS RELEASE
Natural Resource Partners L.P.
Reports Third Quarter Results
Third Quarter 2015 Highlights
• | Net income attributable to the limited partners, excluding impairments, of $28.3 million, or $0.23 per unit |
• | Non-cash impairment charges attributable to the limited partners of $614.3 million, or $5.02 per unit |
• | Net loss attributable to the limited partners of $586.0 million, or $4.79 per unit |
• | Distributable cash flow of $58.0 million, or $0.46 per unit |
• | Adjusted EBITDA of $78.5 million |
• | Consolidated Debt-to-Adjusted EBITDA of 4.7x at September 30, 2015 |
HOUSTON, November 5, 2015 – Natural Resource Partners L.P. (NYSE:NRP) today reported a net loss attributable to the limited partners for the third quarter of 2015 of $586.0 million, or $4.79 per unit, compared with net income attributable to the limited partners of $35.5 million, or $0.32 per unit a year earlier. Results for the third quarter of 2015 were negatively impacted by $614.3 million of non-cash impairment charges attributable to the limited partners, as the market value of certain of the Partnership's assets were impacted by continued deterioration of the coal markets and the significant decline in oil prices.
“Although our soda ash and aggregates businesses performed well again in the third quarter, low commodity prices and challenging markets continued to pressure our coal and oil and gas businesses,” said Wyatt Hogan, President and Chief Operating Officer. “In this difficult operating environment, NRP remains steadfastly focused on achieving its deleveraging target of a Consolidated Debt-to-EBITDA ratio of 3.5x by the end of 2017. We believe the actions taken this year will better position the partnership to navigate this difficult commodity price period and become a stronger company for the future.”
NRP Reports Third Quarter 2015 Results 2 of 16
To date in 2015, NRP has taken the following steps to achieve the financial objectives outlined in the April 2015 strategic plan:
• | reduced quarterly unitholder distribution by 87% from $0.35 to $0.045 per common unit, which is expected to provide approximately $150 million of cash annually for debt repayment in future periods; |
• | extended the maturity of Opco’s revolving credit facility until October 1, 2017; |
• | reduced net debt by $66 million, having repaid $56 million in principal on Opco’s senior notes, repaid the $75 million Opco term loan in full using borrowings under Opco’s revolving credit facility, and repaid $25 million under the NRP Oil and Gas revolving credit facility, of which $15 million was paid following the end of the third quarter; |
• | announced plans to close three regional offices and reduce NRP’s coal related workforce by 15%, and implemented other steps to reduce overhead costs; and |
• | commenced processes, including the engagement of advisors, to sell assets in order to raise cash to help NRP stay on track to achieve its deleveraging objectives in spite of a difficult commodity environment. |
At September 30, 2015, NRP had $76 million of liquidity, consisting of $61 million in cash and $15 million available for borrowing under its revolving credit facilities. Since the end of the quarter, the NRP Oil and Gas revolving credit facility borrowing base redetermination was completed and the borrowing base was reduced from $105 million to $88 million. NRP subsequently paid off $15 million of borrowings, leaving $85 million of debt outstanding under the facility.
In October 2015, the Board of Directors of NRP's general partner declared a quarterly distribution of $0.045 per unit with respect to the third quarter of 2015, a decrease of 50% from the previous quarter, and a decrease of 87% from the distribution paid with respect to the third quarter of 2014.
NRP Reports Third Quarter 2015 Results 3 of 16
Highlights | For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
September 30, | % | September 30, | % | ||||||||||||||
2015 | 2014 | Change | 2015 | 2014 | Change | ||||||||||||
(in thousands except per unit and per ton) | (in thousands except per unit and per ton) | ||||||||||||||||
Revenues | |||||||||||||||||
Total revenues and other income | $ | 125,479 | $ | 91,609 | 37 | % | $ | 372,786 | $ | 262,479 | 42 | % | |||||
Coal production (tons) | 11,395 | 13,370 | (15 | )% | 36,523 | 37,473 | (3 | )% | |||||||||
Average coal royalty revenue per ton | $ | 3.33 | $ | 3.80 | (12 | )% | $ | 3.11 | $ | 3.74 | (17 | )% | |||||
Coal royalty revenues | $ | 37,957 | $ | 50,870 | (25 | )% | $ | 113,602 | $ | 140,169 | (19 | )% | |||||
Other coal related revenue | $ | 17,047 | $ | 14,323 | 19 | % | $ | 51,788 | $ | 32,758 | 58 | % | |||||
Total coal related revenues | $ | 55,004 | $ | 65,193 | (16 | )% | $ | 165,390 | $ | 172,927 | (4 | )% | |||||
Aggregates related revenue | $ | 42,326 | $ | 2,655 | 1,494 | % | $ | 114,158 | $ | 9,614 | 1,087 | % | |||||
Oil and gas related revenue | $ | 12,416 | $ | 9,601 | 29 | % | $ | 42,485 | $ | 37,481 | 13 | % | |||||
Equity in earnings of unconsolidated investment | $ | 12,617 | $ | 9,685 | 30 | % | $ | 36,739 | $ | 28,865 | 27 | % | |||||
Operating expenses | $ | 701,769 | $ | 36,582 | 1,818 | % | $ | 852,739 | $ | 104,610 | 715 | % | |||||
Operating expenses excluding impairments | $ | 74,931 | $ | 36,582 | 105 | % | $ | 222,098 | $ | 98,986 | 124 | % | |||||
Interest expense | $ | 23,711 | $ | 18,862 | 26 | % | $ | 69,997 | $ | 57,759 | 21 | % | |||||
Net income | |||||||||||||||||
Net income (loss) to limited partners | $ | (586,013 | ) | $ | 35,450 | (1,753 | )% | $ | (538,166 | ) | $ | 98,181 | (648 | )% | |||
Net income (loss) per common unit | $ | (4.79 | ) | $ | 0.32 | (1,597 | )% | $ | (4.40 | ) | $ | 0.89 | (594 | )% | |||
Weighted average common units outstanding | 122,300 | 111,244 | 10 | % | 122,300 | 110,504 | 11 | % | |||||||||
Net income excluding impairments (1) | |||||||||||||||||
Net income to limited partners | $ | 28,288 | $ | 35,450 | (20 | )% | $ | 79,862 | $ | 103,693 | (23 | )% | |||||
Net income per unit | $ | 0.23 | $ | 0.32 | (28 | )% | $ | 0.65 | $ | 0.94 | (31 | )% | |||||
Net cash provided by operating activities | $ | 55,240 | $ | 57,458 | (4 | )% | $ | 161,350 | $ | 157,096 | 3 | % | |||||
Distributable cash flow (1) | $ | 58,007 | $ | 57,773 | — | % | $ | 157,805 | $ | 160,670 | (2 | )% | |||||
Adjusted EBITDA (1) | $ | 78,539 | $ | 68,571 | 15 | % | $ | 221,896 | $ | 214,489 | 3 | % | |||||
(1) See "Non-GAAP Financial Measures" and reconciliation tables at the end of the release. | |||||||||||||||||
Third Quarter 2015 compared to Third Quarter 2014
During the third quarter, NRP identified facts and circumstances that indicated that the carrying value of certain mineral rights may exceed expected future cash flows from those assets and recorded non-cash impairment expense as follows (in thousands):
NRP Reports Third Quarter 2015 Results 4 of 16
Asset Description | Amount | |||
Oil and Gas | $ | 335,662 | ||
Coal | 247,815 | |||
Aggregates royalties | 43,361 | |||
Total impairment expense | $ | 626,838 | ||
Impairments attributable to the general partner | $ | 12,537 | ||
Impairments attributable to the limited partners | $ | 614,301 | ||
Oil and gas property impairments primarily resulted from declines in future expected realized commodity prices and reduced expected drilling activity on NRP's acreage. Coal property impairments primarily resulted from idled operations in Appalachia combined with the continued deterioration in the coal markets and expectations of further reductions in global and domestic coal demand due to reduced global steel demand, low natural gas prices, and continued regulatory pressure on the electric power generation industry. Aggregates royalty property impairments primarily resulted from greenfield development projects that have not performed as well as initially projected. No VantaCore assets were subject to impairments.
Net income attributable to the limited partners for the third quarter, excluding impairments, declined 7.2 million, or 20%, compared to the previous year as contributions from our investment in the soda ash business and the VantaCore operations acquired in the fourth quarter of 2014 were more than offset by declines in coal revenues, losses in oil and gas, and increased interest expense. Including impairments, net income to the limited partners declined $621.5 million.
Net income per unit, excluding impairments, declined $0.09, or 28%, compared to the third quarter 2014, as a result of lower net income and 11.1 million additional common units outstanding during 2015. Including impairments, net income per unit declined by $5.11.
Distributable cash flow of $58.0 million for the third quarter of 2015 was essentially flat with the previous year, as an increase of $7.4 million from asset sales was substantially offset by $5.6 million of maintenance capital expenditures and reduced cash from operations. Distributable cash flow per unit declined 10% as a result of the increase in common units outstanding compared to the third quarter of 2014.
Adjusted EBITDA increased $10.0 million, or 15%, in the third quarter 2015 to $78.5 million. This increase in Adjusted EBITDA is mainly related to the inclusion of VantaCore and the Sanish Field in our operating results in 2015, as well as increased distributions from our soda ash investment.
Year to Date 2015 compared to Year to Date 2014
Net income attributable to the limited partners for the first nine months of 2015, excluding impairments, declined $23.8 million, or 23%, compared to the previous year as contributions from our investment in the soda ash business and the VantaCore operations acquired in the fourth quarter of 2014 were more than offset by declines in coal revenues, losses in oil and gas, and increased interest expense. Including impairments, net income to the limited partners declined $636.3 million.
NRP Reports Third Quarter 2015 Results 5 of 16
Net income per unit, excluding impairments, declined $0.29, or 31%, compared to the first nine months of 2014 as a result of lower net income and 11.8 million additional outstanding units. Including impairments, net income per unit declined by $5.29.
Distributable cash flow of $157.8 million for the first nine months of 2015 was essentially flat with the previous year as increased cash from operating activities and asset sale proceeds of $17.9 million were more than offset by $20.9 million of maintenance capital expenditures. Distributable cash flow per common unit declined by 11% as a result of the increase in common units outstanding compared to the first nine months of 2014.
Adjusted EBITDA increased $7.4 million in the first nine months of 2015 over the prior period to $221.9 million. This increase in Adjusted EBITDA is mainly related to the inclusion of VantaCore and the Sanish Field in our operating results in 2015.
Company Profile
Natural Resource Partners L.P. is a master limited partnership headquartered in Houston, TX. NRP is a diversified natural resource company that owns interests in oil and gas, coal, aggregates and industrial minerals across the United States. A large percentage of NRP's revenues are generated from royalties and other passive income. In addition, NRP owns an equity investment in Ciner Wyoming LLC (formerly OCI Wyoming LLC), a trona/soda ash operation, owns non-operated working interests in oil and gas properties and owns VantaCore, a construction aggregates business, making NRP one of the top 25 aggregates producers in the United States.
For additional information, please contact Kathy H. Roberts at 713-751-7555 or kroberts@nrplp.com. Further information about NRP is available on the partnership’s website at http://www.nrplp.com.
Non-GAAP Financial Measures
“Distributable cash flow” represents cash flow from operations plus return on unconsolidated equity investments, proceeds from the sale of assets, and the return on direct financing lease and contractual overrides less maintenance capital expenditures and distributions to non-controlling interest. Distributable cash flow is a “non-GAAP financial measure” that is presented because management believes it is a useful adjunct to net cash provided by operating activities under GAAP. Distributable cash flow is a significant liquidity metric that is an indicator of NRP’s ability to make quarterly cash distributions to its partners. Distributable cash flow is also the quantitative standard used throughout the investment community with respect to publicly traded partnerships. Distributable cash flow is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing or financing activities. A reconciliation of distributable cash flow to net cash provided by operating activities is included in the tables attached to this release. Distributable cash flow may not be calculated the same for NRP as other companies.
“Adjusted EBITDA” is a non-GAAP financial measure that we define as net income less equity and other unconsolidated investment income, gains on reserve swap and income to non-controlling interest; plus cash distributions received from unconsolidated affiliates, interest expense, taxes, depreciation, depletion and amortization, and asset impairments. “Adjusted EBITDA,” as used and defined by us, may not be comparable to similarly titled measures employed by other companies and is not a measure of performance calculated in accordance with GAAP. Adjusted EBITDA should not be considered in isolation or as a substitute for operating income, net income or loss, cash flows provided by operating, investing and financing activities, or other income or cash flow statement data prepared in accordance with GAAP. Adjusted EBITDA provides no information regarding a company’s capital structure, borrowings, interest costs, capital expenditures, and working capital movement or tax positions. Adjusted EBITDA does not represent funds available for discretionary use because those funds may be required for debt service, capital expenditures, working capital and other commitments and obligations. Our management team believes Adjusted EBITDA is useful in evaluating our financial
NRP Reports Third Quarter 2015 Results 6 of 16
performance because this measure is widely used by analysts, investors and rating agencies for comparative purposes. There are significant limitations to using Adjusted EBITDA as a measure of performance, including the inability to analyze the effect of certain recurring and non-recurring items that materially affect our net income or loss, the lack of comparability of results of operations of different companies and the different methods of calculating Adjusted EBITDA reported by different companies. A reconciliation of Adjusted EBITDA to net income is included in the tables attached to this release.
Forward-Looking Statements
This press release includes “forward-looking statements” as defined by the Securities and Exchange Commission. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the partnership expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements are based on certain assumptions made by the partnership based on its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the partnership. These risks include, but are not limited to, commodity prices; decreases in demand for coal, oil, natural gas, and aggregates and industrial minerals, including trona/soda ash; changes in operating conditions and costs; production cuts by our lessees; the pace of development of our oil and natural gas properties; unanticipated geologic problems; our liquidity and access to capital and financing sources; changes in the legislative or regulatory environment and other factors detailed in Natural Resource Partners’ Securities and Exchange Commission filings. Natural Resource Partners L.P. has no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
15-11
-Financial statements follow-
NRP Reports Third Quarter 2015 Results 7 of 16
Natural Resource Partners, L.P. | ||||||||||
Comparison of Third Quarter 2015 to Second Quarter 2015 | ||||||||||
For the Three Months Ended | ||||||||||
September 30, 2015 | June 30, 2015 | % Change | ||||||||
(in thousands, except per ton and per unit) | ||||||||||
Revenues and other income | ||||||||||
Total revenues and other income | $ | 125,479 | $ | 137,630 | (9 | )% | ||||
Coal production (tons) | 11,395 | 14,020 | (19 | )% | ||||||
Average coal royalty revenue per ton | $ | 3.33 | $ | 2.74 | 22 | % | ||||
Coal royalty revenues | $ | 37,957 | $ | 38,433 | (1 | )% | ||||
Other coal related revenue | $ | 17,047 | $ | 22,471 | (24 | )% | ||||
Total coal related revenue | $ | 55,004 | $ | 60,904 | (10 | )% | ||||
Aggregates related revenue | $ | 42,326 | $ | 42,886 | (1 | )% | ||||
Oil and gas related revenue | $ | 12,416 | $ | 14,839 | (16 | )% | ||||
Equity in earnings of unconsolidated investment | $ | 12,617 | $ | 11,599 | 9 | % | ||||
Operating expenses | $ | 701,769 | $ | 81,710 | 759 | % | ||||
Operating expenses excluding impairments | $ | 74,931 | $ | 77,907 | (4 | )% | ||||
Net income (loss) | ||||||||||
Net income (loss) to limited partners | $ | (586,013 | ) | $ | 30,707 | (2,008 | )% | |||
Net income (loss) per unit | $ | (4.79 | ) | $ | 0.25 | (2,016 | )% | |||
Average units outstanding | 122,300 | 122,300 | — | % | ||||||
Net income excluding impairments | ||||||||||
Net income to the limited partners | $ | 28,288 | $ | 34,434 | (18 | )% | ||||
Net income per unit | $ | 0.23 | $ | 0.28 | (18 | )% | ||||
Net cash provided by operating activities | $ | 55,240 | $ | 50,638 | 9 | % | ||||
Distributable cash flow | $ | 58,007 | $ | 47,171 | 23 | % | ||||
Adjusted EBITDA | $ | 78,539 | $ | 79,153 | (1 | )% | ||||
NRP Reports Third Quarter 2015 Results 8 of 16
Natural Resource Partners L.P. | ||||||||||||||||||||
Consolidated Statements of Comprehensive Income (loss) | ||||||||||||||||||||
(in thousands, except per unit data) | ||||||||||||||||||||
For the Three Months Ended, | For the Nine Months Ended | |||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||||||
(unaudited) | (unaudited) | |||||||||||||||||||
Revenues and other income: | ||||||||||||||||||||
Coal related revenues | $ | 35,469 | $ | 39,675 | $ | 94,452 | $ | 107,593 | ||||||||||||
Coal related revenues - affiliates | 19,535 | 25,518 | 70,938 | 65,334 | ||||||||||||||||
Aggregates related revenues | 42,326 | 2,655 | 114,158 | 9,614 | ||||||||||||||||
Oil and gas related revenues | 12,416 | 9,601 | 42,485 | 37,481 | ||||||||||||||||
Equity in earnings of unconsolidated investment | 12,617 | 9,685 | 36,739 | 28,865 | ||||||||||||||||
Property taxes | 2,528 | 3,520 | 8,602 | 10,865 | ||||||||||||||||
Other | 588 | 955 | 5,412 | 2,727 | ||||||||||||||||
Total revenues and other income | 125,479 | 91,609 | 372,786 | 262,479 | ||||||||||||||||
Operating expenses: | ||||||||||||||||||||
Coal related expenses | 649 | 3,383 | 2,474 | 4,623 | ||||||||||||||||
Coal related expenses - affiliates, net | (68 | ) | — | 41 | — | |||||||||||||||
Aggregates related expenses, net | 31,107 | (244 | ) | 86,314 | (170 | ) | ||||||||||||||
Oil and gas related expenses | 3,049 | 2,147 | 9,809 | 6,359 | ||||||||||||||||
General and administrative | 5,140 | 4,825 | 14,829 | 13,543 | ||||||||||||||||
General and administrative - affiliates | 4,144 | 3,083 | 11,465 | 9,177 | ||||||||||||||||
Depreciation, depletion and amortization | 26,624 | 18,621 | 82,676 | 49,618 | ||||||||||||||||
Property, franchise and other taxes | 4,286 | 4,767 | 14,490 | 15,836 | ||||||||||||||||
Asset impairments | 626,838 | — | 630,641 | 5,624 | ||||||||||||||||
Total operating expenses | 701,769 | 36,582 | 852,739 | 104,610 | ||||||||||||||||
Income (loss) from operations | (576,290 | ) | 55,027 | (479,953 | ) | 157,869 | ||||||||||||||
Other income (expense) | ||||||||||||||||||||
Interest expense | (23,711 | ) | (18,862 | ) | (69,997 | ) | (57,759 | ) | ||||||||||||
Interest income | — | 8 | 16 | 75 | ||||||||||||||||
Other expense, net | (23,711 | ) | (18,854 | ) | (69,981 | ) | (57,684 | ) | ||||||||||||
Net Income (loss) | (600,001 | ) | 36,173 | (549,934 | ) | 100,185 | ||||||||||||||
Less: net loss attributable to non-controlling interest | 1,244 | — | — | — | ||||||||||||||||
Net income (loss) attributable to NRP | $ | (598,757 | ) | $ | 36,173 | $ | (549,934 | ) | $ | 100,185 | ||||||||||
Net income (loss) attributable to partners: | ||||||||||||||||||||
Limited partners | (586,013 | ) | 35,450 | (538,166 | ) | 98,181 | ||||||||||||||
General partner | (12,744 | ) | 723 | (11,768 | ) | 2,004 | ||||||||||||||
Basic and diluted net income (loss) per common unit | $ | (4.79 | ) | $ | 0.32 | $ | (4.40 | ) | $ | 0.89 | ||||||||||
Weighted average number of common units outstanding: | 122,300 | 111,244 | 122,300 | 110,504 | ||||||||||||||||
Net income (loss) | $ | (600,001 | ) | $ | 36,173 | $ | (549,934 | ) | $ | 100,185 | ||||||||||
Add: Comprehensive income (loss) from unconsolidated investment and other | (1,136 | ) | 370 | (1,891 | ) | 106 | ||||||||||||||
Less: Comprehensive loss attributable to non-controlling interest | 1,244 | — | — | — | ||||||||||||||||
Comprehensive income (loss) attributable to NRP | $ | (599,893 | ) | $ | 36,543 | $ | (551,825 | ) | $ | 100,291 | ||||||||||
NRP Reports Third Quarter 2015 Results 9 of 16
Natural Resource Partners L.P. | |||||||||||||||||||
Consolidated Statements of Cash Flow | |||||||||||||||||||
(in thousands, except per unit data) | |||||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | ||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||||||
(unaudited) | (unaudited) | ||||||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||
Net income (loss) | $ | (600,001 | ) | $ | 36,173 | $ | (549,934 | ) | $ | 100,185 | |||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||||||||||
Asset impairment | 626,838 | — | 630,641 | 5,624 | |||||||||||||||
Depreciation, depletion and amortization | 26,624 | 18,621 | 82,676 | 49,618 | |||||||||||||||
Distributions from equity earnings from unconsolidated investment | 12,740 | 10,290 | 34,545 | 32,225 | |||||||||||||||
Equity earnings from unconsolidated investment | (12,617 | ) | (9,685 | ) | (36,739 | ) | (28,865 | ) | |||||||||||
Gain on reserve swap | — | (5,690 | ) | (9,290 | ) | (5,690 | ) | ||||||||||||
Other, net | (305 | ) | 674 | (3,033 | ) | 2,142 | |||||||||||||
Other, net - affiliates | (734 | ) | — | (721 | ) | — | |||||||||||||
Change in operating assets and liabilities: | |||||||||||||||||||
Accounts receivable | (641 | ) | (2,394 | ) | 11,919 | (5,072 | ) | ||||||||||||
Accounts receivable - affiliates | 742 | (1,529 | ) | 2,044 | (2,881 | ) | |||||||||||||
Accounts payable | (3,350 | ) | 2,782 | (2,769 | ) | 1,662 | |||||||||||||
Accounts payable - affiliates | 1,627 | 40 | 1,616 | 94 | |||||||||||||||
Accrued liabilities | 8,478 | 2,961 | 3,059 | 993 | |||||||||||||||
Deferred revenue | (1,464 | ) | 1,084 | 6,035 | (81 | ) | |||||||||||||
Deferred revenue - affiliates | (3,462 | ) | 3,162 | (3,399 | ) | 11,426 | |||||||||||||
Accrued incentive plan expenses | 535 | 471 | (6,417 | ) | (5,445 | ) | |||||||||||||
Other items, net | 498 | 432 | 1,750 | 750 | |||||||||||||||
Other items, net - affiliates | (268 | ) | 66 | (633 | ) | 411 | |||||||||||||
Net cash provided by operating activities | 55,240 | 57,458 | 161,350 | 157,096 | |||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||
Acquisition of mineral rights | (6,818 | ) | (5,144 | ) | (35,939 | ) | (14,035 | ) | |||||||||||
Acquisition of plant and equipment and other | (3,508 | ) | (72 | ) | (8,581 | ) | (207 | ) | |||||||||||
Proceeds from sale of plant and equipment and other | 5,751 | 5 | 11,006 | 5 | |||||||||||||||
Proceeds from sale of mineral rights | 1,660 | — | 6,941 | — | |||||||||||||||
Return on equity and other unconsolidated investments | — | — | — | 3,633 | |||||||||||||||
Return on long-term contract receivables - affiliate | 984 | 310 | 2,121 | 910 | |||||||||||||||
Net cash used in investing activities | (1,931 | ) | (4,901 | ) | (24,452 | ) | (9,694 | ) | |||||||||||
Cash flows from financing activities: | |||||||||||||||||||
Proceeds from loans | 75,000 | — | 100,000 | 2,000 | |||||||||||||||
Proceeds from issuance of common units | — | 10,984 | — | 24,826 | |||||||||||||||
Capital contribution by general partner | — | 160 | — | 507 | |||||||||||||||
Repayment of loans | (82,692 | ) | (15,692 | ) | (151,175 | ) | (69,175 | ) | |||||||||||
Distributions to partners | (11,232 | ) | (39,733 | ) | (66,142 | ) | (118,372 | ) | |||||||||||
Distributions to non-controlling interest | — | — | (2,744 | ) | (974 | ) | |||||||||||||
Debt issuance costs and other | (754 | ) | (163 | ) | (5,757 | ) | (601 | ) | |||||||||||
Net cash used in financing activities | (19,678 | ) | (44,444 | ) | (125,818 | ) | (161,789 | ) | |||||||||||
Net increase (decrease) in cash and cash equivalents | 33,631 | 8,113 | 11,080 | (14,387 | ) | ||||||||||||||
Cash and cash equivalents at beginning of period | 27,525 | 70,013 | 50,076 | 92,513 | |||||||||||||||
Cash and cash equivalents at end of period | $ | 61,156 | $ | 78,126 | $ | 61,156 | $ | 78,126 | |||||||||||
Supplemental cash flow information: | |||||||||||||||||||
Cash paid during the period for interest | $ | 13,743 | $ | 13,131 | $ | 57,917 | $ | 52,266 | |||||||||||
Plant, equipment and mineral rights funded with accounts payable or accrued liabilities | $ | 13 | — | 4,465 | — | ||||||||||||||
NRP Reports Third Quarter 2015 Results 10 of 16
Natural Resource Partners L.P. | |||||||||||||||
Consolidated Balance Sheets | |||||||||||||||
(in thousands, except for unit information) | |||||||||||||||
September 30, | December 31, | ||||||||||||||
2015 | 2014 | ||||||||||||||
(unaudited) | |||||||||||||||
ASSETS | |||||||||||||||
Current assets: | |||||||||||||||
Cash and cash equivalents | $ | 61,156 | $ | 50,076 | |||||||||||
Accounts receivable, net | 54,888 | 66,455 | |||||||||||||
Accounts receivable - affiliates | 7,450 | 9,494 | |||||||||||||
Inventory | 6,849 | 5,814 | |||||||||||||
Prepaid expenses and other | 2,661 | 4,279 | |||||||||||||
Total current assets | 133,004 | 136,118 | |||||||||||||
Land | 25,022 | 25,243 | |||||||||||||
Plant and equipment, net | 71,194 | 60,093 | |||||||||||||
Mineral rights, net | 1,144,809 | 1,781,852 | |||||||||||||
Intangible assets, net | 58,269 | 60,733 | |||||||||||||
Equity in unconsolidated investment | 262,347 | 264,020 | |||||||||||||
Long-term contracts receivable - affiliate | 48,520 | 50,008 | |||||||||||||
Goodwill | 4,840 | 52,012 | |||||||||||||
Other assets | 16,864 | 14,645 | |||||||||||||
Other assets - affiliate | 1,525 | — | |||||||||||||
Total assets | $ | 1,766,394 | $ | 2,444,724 | |||||||||||
LIABILITIES AND CAPITAL | |||||||||||||||
Current liabilities: | |||||||||||||||
Accounts payable | $ | 11,377 | $ | 22,465 | |||||||||||
Accounts payable - affiliates | 2,566 | 950 | |||||||||||||
Accrued liabilities | 54,895 | 43,533 | |||||||||||||
Current portion of long-term debt, net | 80,983 | 80,983 | |||||||||||||
Total current liabilities | 149,821 | 147,931 | |||||||||||||
Deferred revenue | 79,242 | 73,207 | |||||||||||||
Deferred revenue - affiliates | 83,654 | 87,053 | |||||||||||||
Long-term debt, net | 1,323,708 | 1,374,336 | |||||||||||||
Long-term debt, net - affiliate | 19,923 | 19,904 | |||||||||||||
Other non-current liabilities | 9,839 | 22,138 | |||||||||||||
Partners' capital: | |||||||||||||||
Common unitholders’ interest (122,299,825 units outstanding) | 106,011 | 709,019 | |||||||||||||
General partner's interest | (60 | ) | 12,245 | ||||||||||||
Accumulated other comprehensive loss | (2,350 | ) | (459 | ) | |||||||||||
Total partners' capital | 103,601 | 720,805 | |||||||||||||
Non-controlling interest | (3,394 | ) | (650 | ) | |||||||||||
Total capital | 100,207 | 720,155 | |||||||||||||
Total liabilities and capital | $ | 1,766,394 | $ | 2,444,724 | |||||||||||
NRP Reports Third Quarter 2015 Results 11 of 16
Natural Resource Partners L.P. | ||||||||||||||||||||
Operating Statistics - Coal Related Revenue | ||||||||||||||||||||
(in thousands except per ton data) | ||||||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||||||
September 30, | September 30 | |||||||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||||||
(unaudited) | (unaudited) | |||||||||||||||||||
Regional Statistics | ||||||||||||||||||||
Coal royalty production (tons): | ||||||||||||||||||||
Appalachia | ||||||||||||||||||||
Northern | 1,518 | 2,060 | 7,581 | 6,537 | ||||||||||||||||
Central | 4,642 | 5,432 | 13,402 | 15,096 | ||||||||||||||||
Southern | 851 | 1,017 | 3,000 | 2,950 | ||||||||||||||||
Total Appalachia | 7,011 | 8,509 | 23,983 | 24,583 | ||||||||||||||||
Illinois Basin | 2,722 | 3,526 | 8,265 | 10,064 | ||||||||||||||||
Northern Powder River Basin | 1,301 | 1,054 | 3,497 | 2,106 | ||||||||||||||||
Gulf Coast | 361 | 281 | 778 | 720 | ||||||||||||||||
Total coal royalty production | 11,395 | 13,370 | 36,523 | 37,473 | ||||||||||||||||
Average royalty revenue per ton: | ||||||||||||||||||||
Appalachia | ||||||||||||||||||||
Northern | $ | 0.50 | $ | 0.90 | $ | 0.28 | $ | 0.91 | ||||||||||||
Central | 3.76 | 4.69 | 3.93 | 4.59 | ||||||||||||||||
Southern | 4.18 | 5.04 | 4.55 | 5.24 | ||||||||||||||||
Total Appalachia | 3.10 | 3.81 | 2.85 | 3.69 | ||||||||||||||||
Illinois Basin | 4.05 | 4.08 | 4.00 | 4.07 | ||||||||||||||||
Northern Powder River Basin | 2.80 | 2.91 | 2.64 | 2.87 | ||||||||||||||||
Gulf Coast | 4.26 | 3.40 | 3.85 | 3.43 | ||||||||||||||||
Combined average royalty revenue per ton | $ | 3.33 | $ | 3.80 | $ | 3.11 | $ | 3.74 | ||||||||||||
Coal royalty revenues: | ||||||||||||||||||||
Appalachia | ||||||||||||||||||||
Northern | $ | 763 | $ | 1,844 | $ | 2,105 | $ | 5,941 | ||||||||||||
Central | 17,440 | 25,470 | 52,616 | 69,289 | ||||||||||||||||
Southern | 3,561 | 5,130 | 13,646 | 15,469 | ||||||||||||||||
Total Appalachia | 21,764 | 32,444 | 68,367 | 90,699 | ||||||||||||||||
Illinois Basin | 11,015 | 14,403 | 33,020 | 40,956 | ||||||||||||||||
Northern Powder River Basin | 3,641 | 3,069 | 9,219 | 6,041 | ||||||||||||||||
Gulf Coast | 1,537 | 954 | 2,996 | 2,473 | ||||||||||||||||
Total coal royalty revenues | $ | 37,957 | $ | 50,870 | $ | 113,602 | $ | 140,169 | ||||||||||||
Other coal related revenues: | ||||||||||||||||||||
Override revenue | $ | 433 | $ | 771 | $ | 2,195 | $ | 3,516 | ||||||||||||
Transportation and processing fees | 5,338 | 5,589 | 16,400 | 16,682 | ||||||||||||||||
Minimums recognized as revenue | 3,234 | 1,396 | 12,480 | 4,204 | ||||||||||||||||
Coal reserve swap | — | 5,690 | 9,290 | 5,690 | ||||||||||||||||
DOH property sale | 1,641 | — | 3,306 | — | ||||||||||||||||
Lease assignment fee | 6,000 | — | 6,000 | — | ||||||||||||||||
Wheelage | 401 | 877 | 2,117 | 2,666 | ||||||||||||||||
Total other coal related revenues | $ | 17,047 | $ | 14,323 | $ | 51,788 | $ | 32,758 | ||||||||||||
Total coal related revenues | $ | 55,004 | $ | 65,193 | $ | 165,390 | $ | 172,927 | ||||||||||||
Coal related revenues | $ | 35,469 | $ | 39,675 | $ | 94,452 | $ | 107,593 | ||||||||||||
Coal related revenues - affiliates | 19,535 | 25,518 | 70,938 | 65,334 | ||||||||||||||||
NRP Reports Third Quarter 2015 Results 12 of 16
Natural Resource Partners L.P. | ||||||||||||||||
Operating Statistics - Aggregates and Industrial Minerals | ||||||||||||||||
(in thousands) | ||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
(unaudited) | (unaudited) | |||||||||||||||
VantaCore | ||||||||||||||||
Tonnage Sold | 2,126 | — | 5,652 | — | ||||||||||||
Revenues | $ | 39,208 | — | $ | 106,606 | — | ||||||||||
Operating expenses | $ | 31,107 | — | $ | 86,314 | — | ||||||||||
Other aggregate related revenue | ||||||||||||||||
Override revenue | $ | 1,398 | $ | 1,708 | $ | 4,285 | $ | 3,908 | ||||||||
Bonus revenue | — | — | — | 562 | ||||||||||||
Processing fees | 215 | 142 | 551 | 448 | ||||||||||||
Minimums recognized as revenue | 25 | 110 | 58 | 1,617 | ||||||||||||
Sale of prep plant | 623 | — | 623 | — | ||||||||||||
Wheelage | 414 | 142 | 688 | 401 | ||||||||||||
Aggregates royalty revenue | 443 | 553 | 1,347 | 2,678 | ||||||||||||
Total aggregate royalty related revenue | $ | 3,118 | $ | 2,655 | $ | 7,552 | $ | 9,614 | ||||||||
Total aggregate related revenues | $ | 42,326 | $ | 2,655 | $ | 114,158 | $ | 9,614 | ||||||||
Investment in Ciner Wyoming: | ||||||||||||||||
Soda ash revenues and distributions | ||||||||||||||||
Equity in earnings of unconsolidated investment | $ | 12,617 | $ | 9,685 | $ | 36,739 | $ | 28,865 | ||||||||
Cash distributions from equity earnings in unconsolidated investment | $ | 12,740 | $ | 10,290 | $ | 34,545 | $ | 35,858 | ||||||||
NRP Reports Third Quarter 2015 Results 13 of 16
Natural Resource Partners L.P. | |||||||||||||||
Operating Statistics - Oil and Gas | |||||||||||||||
($ in thousands) | |||||||||||||||
For the Three Months Ended | For the Nine Months Ended | ||||||||||||||
September 30 | September 30 | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
(unaudited) | (unaudited) | ||||||||||||||
Williston Basin non-operated working interests: | |||||||||||||||
Production volumes: | |||||||||||||||
Oil (MBbl) | 276 | 77 | 849 | 284 | |||||||||||
Natural gas (Mcf) | 192 | 90 | 601 | 202 | |||||||||||
NGL (MBbl) | 33 | 8 | 109 | 20 | |||||||||||
Total Production (MBoe) | 341 | 100 | 1,058 | 338 | |||||||||||
Average sales price per unit | |||||||||||||||
Oil ($/Bbl) | $ | 39.24 | $ | 84.65 | $ | 42.37 | $ | 92.82 | |||||||
Natural gas ($/Mcf) | 2.62 | 5.11 | 2.56 | 6.45 | |||||||||||
NGL ($/Bbl) | 3.48 | 41.00 | 9.57 | 45.55 | |||||||||||
Revenues | |||||||||||||||
Oil | $ | 10,829 | 6,518 | $ | 35,976 | 26,360 | |||||||||
Natural gas | 503 | 460 | 1,540 | 1,303 | |||||||||||
NGL | 115 | 328 | 1,043 | 911 | |||||||||||
Non-production revenue | — | — | 450 | — | |||||||||||
Total revenues | $ | 11,447 | $ | 7,306 | $ | 39,009 | $ | 28,574 | |||||||
Other oil and gas related revenues | |||||||||||||||
Royalty and overriding royalty revenues | $ | 969 | 2,295 | $ | 3,476 | 8,907 | |||||||||
Total oil and gas revenues | $ | 12,416 | $ | 9,601 | $ | 42,485 | $ | 37,481 | |||||||
NRP Reports Third Quarter 2015 Results 14 of 16
Natural Resource Partners L.P. | ||||||||||||||||||
Reconciliation of GAAP Financial Measures | ||||||||||||||||||
to Non-GAAP Financial Measures | ||||||||||||||||||
(in thousands) | ||||||||||||||||||
Reconciliation of GAAP "Net cash provided by operating activities" | ||||||||||||||||||
to Non-GAAP "Distributable cash flow" | ||||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||||
September 30, | September 30, | |||||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||||
(unaudited) | (unaudited) | |||||||||||||||||
Net cash provided by operating activities | $ | 55,240 | $ | 57,458 | $ | 161,350 | $ | 157,096 | ||||||||||
Add: return on long-term contract receivables - affiliate | 984 | 310 | 2,121 | 910 | ||||||||||||||
Add: return on unconsolidated equity investments | — | — | — | 3,633 | ||||||||||||||
Add: proceeds from sale of mineral rights | 1,660 | — | 6,941 | — | ||||||||||||||
Add: proceeds from sale of plant and equipment and other | 5,751 | 5 | 11,006 | 5 | ||||||||||||||
Less: maintenance capital expenditures | (5,628 | ) | — | (20,869 | ) | — | ||||||||||||
Less: distributions to non-controlling interest | — | — | (2,744 | ) | (974 | ) | ||||||||||||
Distributable cash flow | $ | 58,007 | $ | 57,773 | $ | 157,805 | $ | 160,670 | ||||||||||
Units Outstanding | 122,300 | 111,244 | 122,300 | 110,504 | ||||||||||||||
Distributable cash flow per unit | $ | 0.46 | $ | 0.51 | $ | 1.26 | $ | 1.42 | ||||||||||
Reconciliation of GAAP "Net cash provided by operating activities" | ||||||||||||||||||
to Non-GAAP "Distributable cash flow" | ||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||
September 30, | June 30, | |||||||||||||||||
2015 | 2015 | |||||||||||||||||
(unaudited) | ||||||||||||||||||
Net cash provided by operating activities | $ | 55,240 | $ | 50,638 | ||||||||||||||
Add: return on long-term contract receivables - affiliate | 984 | — | ||||||||||||||||
Add: proceeds from sale of mineral rights | 1,660 | 1,020 | ||||||||||||||||
Add: proceeds from sale of plant and equipment and other | 5,751 | 4,350 | ||||||||||||||||
Less: maintenance capital expenditures | (5,628 | ) | (6,755 | ) | ||||||||||||||
Less: distributions to non-controlling interest | — | (2,082 | ) | |||||||||||||||
Distributable cash flow | $ | 58,007 | $ | 47,171 | ||||||||||||||
Units Outstanding | 122,300 | 122,300 | ||||||||||||||||
Distributable cash flow per unit | $ | 0.46 | $ | 0.38 | ||||||||||||||
NRP Reports Third Quarter 2015 Results 15 of 16
Natural Resource Partners L.P. | ||||||||||||||||||
Reconciliation of GAAP Financial Measures | ||||||||||||||||||
to Non-GAAP Financial Measures | ||||||||||||||||||
(in thousands) | ||||||||||||||||||
Reconciliation of GAAP "Net income" | ||||||||||||||||||
to Non-GAAP "Adjusted EBITDA" | ||||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||||
September 30, | September 30, | |||||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||||
(unaudited) | (unaudited) | |||||||||||||||||
Net income (loss) | $ | (600,001 | ) | $ | 36,173 | $ | (549,934 | ) | $ | 100,185 | ||||||||
Less: equity earnings in unconsolidated investment | (12,617 | ) | (9,685 | ) | (36,739 | ) | (28,865 | ) | ||||||||||
Less: gain on reserve swap | — | (5,690 | ) | (9,290 | ) | (5,690 | ) | |||||||||||
Add: loss to non-controlling interest | 1,244 | — | — | — | ||||||||||||||
Add: distributions from equity earnings in unconsolidated investment | 12,740 | 10,290 | 34,545 | 35,858 | ||||||||||||||
Add: depreciation, depletion and amortization | 26,624 | 18,621 | 82,676 | 49,618 | ||||||||||||||
Add: asset impairments | 626,838 | — | 630,641 | 5,624 | ||||||||||||||
Add: interest expense, gross | 23,711 | 18,862 | 69,997 | 57,759 | ||||||||||||||
Adjusted EBITDA | $ | 78,539 | $ | 68,571 | $ | 221,896 | $ | 214,489 | ||||||||||
Reconciliation of GAAP "Net income" | ||||||||||||||||||
to Non-GAAP "Adjusted EBITDA" | ||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||
September 30, | June 30, | |||||||||||||||||
2015 | 2015 | |||||||||||||||||
(unaudited) | ||||||||||||||||||
Net income (loss) | $ | (600,001 | ) | $ | 32,578 | |||||||||||||
Less: equity earnings in unconsolidated investment | (12,617 | ) | (11,599 | ) | ||||||||||||||
Less: gain on reserve swap | — | (9,290 | ) | |||||||||||||||
Less: (income) loss to non-controlling interest | 1,244 | (1,244 | ) | |||||||||||||||
Add: distributions from equity earnings in unconsolidated investment | 12,740 | 10,902 | ||||||||||||||||
Add: depreciation, depletion and amortization | 26,624 | 30,660 | ||||||||||||||||
Add: asset impairments | 626,838 | 3,803 | ||||||||||||||||
Add: interest expense, gross | 23,711 | 23,343 | ||||||||||||||||
Adjusted EBITDA | $ | 78,539 | $ | 79,153 | ||||||||||||||
NRP Reports Third Quarter 2015 Results 16 of 16
Natural Resource Partners L.P. | |||||||||||||||||||
Reconciliation of GAAP "Total operating costs and expenses" | |||||||||||||||||||
to Non-GAAP "Total operating expenses excluding impairments" | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | ||||||||||||||||||
June 30, | September 30, | September 30, | September 30, | September 30, | |||||||||||||||
2015 | 2015 | 2014 | 2015 | 2014 | |||||||||||||||
(unaudited) | (unaudited) | ||||||||||||||||||
Operating expenses | |||||||||||||||||||
Total operating expenses as reported | $ | 81,710 | $ | 701,769 | $ | 36,582 | $ | 852,739 | $ | 104,610 | |||||||||
Asset impairments | (3,803 | ) | (626,838 | ) | — | (630,641 | ) | (5,624 | ) | ||||||||||
Total operating expenses excluding impairments | 77,907 | 74,931 | 36,582 | 222,098 | 98,986 | ||||||||||||||
Reconciliation of GAAP "Net income (loss) attributable to the limited partners" | |||||||||||||||||||
to Non-GAAP "Net income attributable to the limited partners excluding impairments" | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | ||||||||||||||||||
June 30, | September 30, | September 30, | September 30, | September 30, | |||||||||||||||
2015 | 2015 | 2014 | 2015 | 2014 | |||||||||||||||
(unaudited) | (unaudited) | ||||||||||||||||||
Net income (loss) attributable to the limited partners | |||||||||||||||||||
Net income (loss) attributable to the limited partners, as reported | $ | 30,707 | $ | (586,013 | ) | $ | 35,450 | $ | (538,166 | ) | $ | 98,181 | |||||||
Asset impairments attributable to the limited partners | 3,727 | 614,301 | — | 618,028 | 5,512 | ||||||||||||||
Net income attributable to the limited partners excluding impairments | $ | 34,434 | $ | 28,288 | $ | 35,450 | $ | 79,862 | $ | 103,693 | |||||||||
Reconciliation of GAAP "Basic and diluted net income (loss) per unit" | |||||||||||||||||||
to Non-GAAP "Net income per unit excluding impairments" | |||||||||||||||||||
(in thousands, except per unit) | |||||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | ||||||||||||||||||
June 30, | September 30, | September 30, | September 30, | September 30, | |||||||||||||||
2015 | 2015 | 2014 | 2015 | 2014 | |||||||||||||||
(unaudited) | (unaudited) | ||||||||||||||||||
Net income (loss) per unit | |||||||||||||||||||
Net income (loss) per unit as reported | $ | 0.25 | $ | (4.79 | ) | $ | 0.32 | $ | (4.40 | ) | $ | 0.89 | |||||||
Adjustment for asset impairments | 0.03 | 5.02 | — | 5.05 | 0.05 | ||||||||||||||
Net income per limited partner unit excluding impairments | 0.28 | 0.23 | 0.32 | 0.65 | 0.94 | ||||||||||||||
Weighted number of units outstanding | 122,300 | 122,300 | 111,244 | 122,300 | 110,504 | ||||||||||||||
* Numbers may not add due to rounding | |||||||||||||||||||
-end-