Holly Energy Partners, L.P. (“HEP” or the “Partnership”) (NYSE:HEP) today reported financial results for the first quarter of 2014. For the quarter, distributable cash flow was $41.8 million, up $9.4 million, or 29% compared to the first quarter of 2013. HEP announced its 38th consecutive distribution increase on April 24, 2014, raising the quarterly distribution from $0.50 to $0.5075 per unit, representing a 6% increase over the distribution for the first quarter of 2013.
Net income attributable to Holly Energy Partners for the first quarter was $24.1 million ($0.27 per basic and diluted limited partner unit) compared to $18.4 million ($0.21 per basic and diluted limited partner unit) for the first quarter of 2013. The increase in earnings is primarily due to higher pipeline and terminal volumes as pipeline shipments returned to normal levels, following the reduced shipments we experienced during the fourth quarter of 2013 due to operational constraints experienced at HollyFrontier Corporation's ("HFC") Navajo refinery. Shipments were also reduced in the first quarter of 2013 as a result of maintenance turnarounds at both HFC's Navajo refinery and Alon's Big Spring refinery. Additionally, a charge of $7.7 million related to the redemption of our previously outstanding $150 million 8.25% Senior Notes significantly impacted earnings in the first quarter of 2014.
Commenting on the first quarter of 2014, Mike Jennings, Chief Executive Officer, stated, “We are pleased with our financial results for the first quarter of 2014. Strong volumes across our asset base, including increased volumes on our New Mexico crude gathering system, drove higher than anticipated revenue in the quarter. As we previously announced, certain unexpected operational constraints at our largest shipper’s New Mexico refinery significantly reduced shipments on our pipelines into and out of that facility during the fourth quarter of last year; these shipments returned to normal levels in January.
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