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TransMontaigne Partners L.P. Announces Financial Results For The Quarter Ended September 30, 2012

Stocks in this article: TLP

TransMontaigne Partners L.P. (NYSE:TLP) today announced its financial results for the quarter ended September 30, 2012.

FINANCIAL RESULTS

An overview of the financial performance for the quarter ended September 30, 2012, as compared to the quarter ended September 30, 2011, includes:

  • Distributable cash flow generated during the quarter ended September 30, 2012 was $15.3 million compared to $13.1 million for the quarter ended September 30, 2011.
  • The distribution declared per limited partner unit was $0.64 per unit for the quarter ended September 30, 2012, as compared to $0.62 per unit for the quarter ended September 30, 2011.
  • Operating income for the quarter ended September 30, 2012 was $10.7 million compared to $8.6 million for the quarter ended September 30, 2011, principally due to the following:
    • Revenue was $38.9 million compared to $37.1 million due to increases in revenue at the Gulf Coast, Midwest, Brownsville and River terminals of approximately $0.8 million, $1.1 million, $0.4 million and $0.1 million, respectively, offset by a decrease in revenue at the Southeast terminals of approximately $0.6 million.
    • Direct operating costs and expenses were $16.2 million compared to $16.5 million due to decreases in direct operating costs and expenses at the River and Southeast terminals of approximately $0.2 million and $0.4 million, respectively, offset by an increase in direct operating costs and expenses at the Gulf Coast terminals of approximately $0.2 million. The direct operating costs and expenses for the Midwest and Brownsville terminals were consistent period over period, respectively.
  • Quarterly net earnings for the quarter ended September 30, 2012 increased to $9.9 million from $7.7 million, and net earnings per limited partner unit - basic for the quarter ended September 30, 2012 increased to $0.59 per unit from $0.46 per unit due principally to the increases in operating income discussed above.

Our terminaling services agreements are structured as either throughput agreements or storage agreements. Most of our throughput agreements contain provisions that require our customers to throughput a minimum volume of product at our facilities over a stipulated period of time, which results in a fixed amount of revenue to be recognized by us. Our storage agreements require our customers to make minimum payments based on the volume of storage capacity made available to the customer under the agreement, which results in a fixed amount of revenue to be recognized by us. 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 “variable.” Our revenue was as follows (in thousands):

           
Three months ended September 30, Nine months ended September 30,
2012       2011 2012       2011
Firm Commitments:
Terminaling services fees, net:
External customers $8,300 $7,907 $24,104 $24,839
Affiliates 21,345 20,752 62,788 60,617
Total firm commitments 29,645 28,659 86,892 85,456
Variable:
Terminaling services fees, net:
External customers 562 450 1,985 1,991
Affiliates (40) (73) (100) (129)
Total 522 377 1,885 1,862
Pipeline transportation fees 1,268 1,069 3,994 3,242
Management fees and reimbursed costs 1,531 1,126 4,274 2,709
Other 5,908 5,854 19,104 19,784
Total variable 9,229 8,426 29,257 27,597
Total revenue $38,874 $37,085 $116,149 $113,053
 

The amount of revenue recognized as “firm commitments” based on the remaining contractual terms of the terminaling services agreements that generated “firm commitments” for the nine months ended September 30, 2012 was as follows (in thousands):

     
At September 30, 2012
Remaining terms on terminaling services agreements that generated “firm commitments”:
Less than 1 year remaining $11,958
1 year or more, but less than 3 years remaining 61,405
3 years or more, but less than 5 years remaining 9,705
5 years or more remaining 3,824
Total firm commitments for the nine months ended September 30, 2012 $86,892
 

RECENT DEVELOPMENTS

As of August 1, 2012 we completed the construction of one million barrels of crude oil storage tankage in Cushing, Oklahoma. As previously disclosed, we have entered into a long-term terminaling services agreement with Morgan Stanley Capital Group for the use of this facility. Under this agreement, Morgan Stanley Capital Group agreed to throughput a volume of crude oil at our Cushing, Oklahoma terminal that will, at the fee schedule contained in the agreement, result in minimum throughput payments to us of approximately $4.3 million for each one-year period following the in-service date of August 1, 2012 through July 31, 2019.

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