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Rentech Nitrogen Announces Results For The First Quarter Of 2012; Issues New Guidance For 2012

Stocks in this article: RNF

Rentech Nitrogen has already purchased or contracted at fixed prices for 68% of the natural gas required to produce the product already delivered or forecasted to be delivered during the twelve months ending December 31, 2012. Included in these purchases are forward purchase contracts for approximately 3.1 million MMBtus in excess of the partnership’s needs to produce product sold to date under pre-paid sales contracts, at an average price of $2.75 per MMBtu, excluding transportation costs.

The calculation of forecasted cash available for distribution has been included below in this press release.

First Quarter Cash Distribution

On April 27, 2012, Rentech Nitrogen declared its first cash distribution of $1.06 per unit, payable on May 15, 2012 to unit holders of record as of May 8. The distribution benefited from strong deliveries of ammonia during the first quarter of 2012, and the inclusion of cash available for distribution from the period that began upon the close of the partnership’s initial public offering, November 9, 2011, and ended December 31, 2011. That period included fall product deliveries and excluded the negative impact of the plant turnaround, which took place in the first 15½ days of October, 2011. The calculation of cash available for distribution for the period from November 9, 2011 through March 31, 2012, has been included below in this press release.

Conference Call with Management

The partnership will hold a conference call on Friday, May 11, 2012 at 10:00 a.m. PDT, during which time senior management will review the partnership’s financial results for this period and provide an update on the business. Callers may listen to the live presentation, which will be followed by a question and answer segment, by dialing 800-736-7549 or 212-231-2905. An audio webcast of the call will be available at www.rentechnitrogen.com within the Investor Relations portion of the site under the Presentations section. A replay will be available by audio webcast and teleconference from 12:00 p.m. PDT on May 11 through 12:00 p.m. PDT on May 18. The replay teleconference will be available by dialing 800-633-8284 or 402-977-9140 and the reservation number 21586850.

 
Rentech Nitrogen Partners, L.P.
Consolidated Statements of Operations
(Stated in Thousands, Except per Unit Data)
                     
For the Three Months Ended
March 31,
2012 2011
(unaudited)
 
Total Revenues $ 38,473 $ 23,943
Cost of Sales   15,901     13,742  
Gross Profit 22,572 10,201
 
Selling, general and administrative expense 2,590 1,126
Depreciation 553 109
Gain on disposal of property, plant and equipment   (28 )   (46 )
Total Operating Expenses   3,115     1,189  
 
Operating Income 19,457 9,012
 
Interest income 16 17
Interest expense (100 ) (3,039 )
Other income, net   -     13  
Total Other Expenses, Net   (84 )   (3,009 )
 
Income Before Income Taxes 19,373 6,003
 
Income tax expense   -     2,470  
Net Income $ 19,373   $ 3,533  
 
Basic and Diluted Net Income per Common Unit $ 0.51
 
Basic and Diluted Weighted-Average Units Outstanding:   38,250  
 
 
 
Rentech Nitrogen Partners, L.P.
Balance Sheet Data
(Stated in Thousands)
 
      As of March 31,                 As of December 31,
2012 2011

Cash and cash equivalents

$ 72,883 $ 44,836

Working Capital

43,285 31,645

Construction in Progress

23,096 7,062

Total Assets

182,648 130,443

Debt

8,490 -

Total Long-Term Liabilities

8,775 277

Total Partners' Capital

119,010 99,191
 
 

Key Operating Statistics for Primary Products:

      For the Three Months
Ended March 31,
2012                 2011
 
 
Delivered Tons (in thousands)

Ammonia

30 20
UAN 34 30
 
Average Price per Delivered Ton
Ammonia $ 673 $ 609
UAN $ 327 $ 206
 
Natural Gas

Natural Gas Used in Production (Million MMBtu)

2.8 2.8

Average Natural Gas Cost per MMBtu, including transportation cost

$ 4.21 $ 4.84
 

Natural Gas Cost in Cost of Sales (Million MMBtu)

1.8 1.4

Average Natural Gas Cost per MMBtu, including transportation cost

$ 4.46 $ 5.02
 

On-Stream Rates:

Ammonia

100.0 % 100.0 %
UAN 100.0 % 100.0 %
 
 

Disclosure Regarding Non-GAAP Financial Measures

EBITDA is defined as net income plus interest expense and other financing costs, income tax expense and depreciation and amortization, net of interest income. We calculate cash available for distribution as EBITDA plus non-cash compensation expense, and less maintenance capital expenditures, net cash interest expense and other financing costs paid and cash reserves for working capital. We present EBITDA because it is a material component in our calculation of cash available for distribution. 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 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 GAAP. 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 and cash available for distribution presented by other companies may not be comparable to our presentation, since each company may define these terms differently.

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