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Genesis Energy, L.P. Reports Record Fourth Quarter And Full Year 2012 Results

Stocks in this article: GEL

Depreciation and amortization decreased $3.4 million between the quarterly periods due to a decrease in amortization expense as we amortize our intangible assets over the period in which we expect them to contribute to our future cash flows. Generally, the amortization we record on those assets is greater in the initial years following their acquisition because our intangible assets are generally more valuable in the first years after an acquisition. Depreciation and amortization expense decreased $1.0 million between the annual periods.

Our derivative positions resulted in a $1.3 million non-cash unrealized loss in the fourth quarter of 2012 compared to a $5.4 million non-cash unrealized loss in the fourth quarter of 2011. Non-cash unrealized loss amounts were comparable between the 2012 and 2011 annual periods.

Income tax benefit decreased $1.2 million between the quarterly periods. Income tax benefit increased $8 million between the annual periods primarily due to the reversal of uncertain tax positions as a result of tax audit settlements and the expiration of statutes of limitations.

We recorded a non-cash expense related to certain equity-based compensation plans of $5 million for the full year of 2012 compared to $0.3 million in the full year of 2011. The differences were due to fluctuations in the market price of our common units and an increase in the number of awards outstanding due to growth in the number of our employees. Non-cash equity-based compensation expense was comparable between the fourth quarters of 2012 and 2011.

Distributions

We have increased our quarterly distribution rate for thirty consecutive quarters. During that period, twenty-five of those quarterly increases have been 10% or greater year-over-year. Over the last four quarters, we have increased the distribution rate on our common units by a total of $0.045 per unit, or 10.2%. Distributions paid over the last four quarters, and the distribution paid on February 14, 2013 for the fourth quarter of 2012, are as follows:

           
Per Unit
Distribution For Date Paid Amount
2012
4th Quarter February 14, 2013 $ 0.4850
3rd Quarter November 14, 2012 $ 0.4725
2nd Quarter August 14, 2012 $ 0.4600
1st Quarter May 15, 2012 $ 0.4500
2011
4th Quarter February 14, 2012 $ 0.4400
 

Earnings Conference Call

We will broadcast our Earnings Conference Call on Thursday, February 14, 2013, at 8:00 a.m. Central time. This call can be accessed at www.genesisenergy.com. Choose the Investor Relations button. For those unable to attend the live broadcast, a replay will be available beginning approximately one hour after the event and remain available on our website for 30 days. There is no charge to access the event.

Genesis Energy, L.P. is a diversified midstream energy master limited partnership headquartered in Houston, Texas. Genesis' operations include pipeline transportation, refinery services and supply and logistics. The Pipeline Transportation Division is engaged in the pipeline transportation of crude oil and carbon dioxide. The Refinery Services Division primarily processes sour gas streams to remove sulfur at refining operations. The Supply and Logistics Division is engaged in the transportation, storage and supply and marketing of energy products, including crude oil, refined products, and certain industrial gases. Genesis' operations are primarily located in Texas, Louisiana, Arkansas, Mississippi, Alabama, Florida and the Gulf of Mexico.

 
GENESIS ENERGY, L.P.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED

(in thousands, except per unit amounts)

 
      Three Months Ended     Year Ended
December 31, December 31,
2012     2011 2012     2011
REVENUES $ 1,054,072 $ 806,881 $ 4,070,057 $ 3,089,669
 
COSTS AND EXPENSES:
Costs of sales 995,695 763,600 3,852,782 2,910,554
General and administrative expenses 12,485 9,134 42,419 34,473
Depreciation and amortization   15,719     19,090     61,166     62,190  
OPERATING INCOME 30,173 15,057 113,690 82,452
Equity in earnings (losses) of equity investees 6,374 (30 ) 14,345 3,347
Interest expense   (10,224 )   (9,097 )   (40,921 )   (35,767 )
INCOME BEFORE INCOME TAXES 26,323 5,930 87,114 50,032
Income tax benefit   614     1,843     9,205     1,217  
NET INCOME $ 26,937   $ 7,773   $ 96,319   $ 51,249  
NET INCOME PER COMMON UNIT:
Basic and Diluted $ 0.34 $ 0.10 $ 1.23 $ 0.75
WEIGHTED AVERAGE OUTSTANDING COMMON UNITS:
Basic and Diluted 81,203 71,965 78,363 67,938
 

Immaterial Restatement -

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