Natural Resource Partners L.P. Reports Second Quarter 2014 Results

- Revenues of $90.6 million

- Net income per unit of $0.28

- Before considering an impairment, net income per unit of $0.33

- Distributable cash flow of $64.9 million

- EBITDA of $77.2 million

- Distribution of $0.35 per unit

06 Aug, 2014, 17:05 ET from Natural Resource Partners L.P.

HOUSTON, Aug. 6, 2014 /PRNewswire/ -- Natural Resource Partners L.P. (NYSE: NRP) today reported revenues of $90.6 million for the second quarter of 2014 compared to $86.8 million for the second quarter of 2013, and distributable cash flow, a non-GAAP measure, of $64.9 million compared to $90.7 million for the second quarter of 2013.  Net income per unit was $0.28 in the second quarter of 2014 versus $0.37 per unit in the second quarter of 2013.  Before considering an asset impairment expense of $5.6 million for an intangible asset related to an aggregates property, net income per unit for the second quarter 2014 was $0.33.  NRP reported EBITDA, a non-GAAP measure, of $77.2 million in the second quarter 2014 compared to $76.1 million for the second quarter 2013.  Reconciliations of the non-GAAP measures of distributable cash flow and EBITDA are included in the tables at the end of this release.

"Strong performances in the first half of the year from our oil and gas, soda ash and Illinois coal businesses offset the challenges that we continue to face in the Appalachian coalfields," said Nick Carter, President and COO.  "Our diversification efforts have provided significant benefits to NRP and consequently our combined operating results for the first six months were in line with our expectations."

At the end of the second quarter, NRP had approximately $373 million in liquidity, consisting of $70 million in cash and $303 million available under its revolving credit facilities.  During the second quarter of 2014, NRP reduced its debt by $12.3 million bringing the total net reduction for the first half of the year to $51.5 million.

"Following through on our stated goal earlier this year, we have used the excess cash generated by our substantial distribution coverage to reduce our leverage," said Dwight Dunlap, Chief Financial Officer.  "We intend to continue to pay down our debt over the remainder of the year and use our liquidity and improved credit to fund the growth and continued diversification of NRP." 

Reaffirmed Guidance and Market Outlook

Excluding a $5.6 million impairment charge taken in the second quarter, NRP is reaffirming its initial guidance for 2014.  While NRP anticipates that coal related revenues may be lower than the initial guidance, revenues from other sources are expected to increase, offsetting those declines.

"We are pleased that our first half results matched our expectations, and anticipate continued strong performance in the second half of the year from our soda ash, oil and gas and Illinois Basin coal operations," said Wyatt Hogan, Executive Vice President.

NRP's Williston Basin assets are benefitting from strong oil markets and production growth from new wells coming on line in the Bakken/Three Forks play.  In addition, NRP's soda ash business continues to perform well, and is on pace to distribute approximately $46 million to NRP in 2014.  The domestic soda ash market remains steady, while the international market for soda ash continues to improve, as global production capacity for high-cost synthetic soda ash continues to be reduced.

While the thermal coal market was starting to show signs of recovery earlier this year aided by the cold winter and higher natural gas prices, the cooler than anticipated summer so far has dampened some of the optimism around thermal coal prices.  The global metallurgical coal market continues to suffer from oversupply in addition to reduced demand from China, and NRP does not anticipate metallurgical coal prices recovering in 2014.  NRP has exposure to three mines included in Alpha's recent WARN notice issued in West Virginia, but even if these mines are ultimately idled, it would not have a material impact on NRP's 2014 forecast as the mines are projected to continue full operations through the third quarter.  While other lessees have also announced potential idling of mines through WARN notices, NRP does not anticipate a material impact on its 2014 results.  In contrast, NRP believes that thermal coal production from its low-cost Illinois Basin properties will continue to remain strong. 

Second Quarter 2014 compared to Second Quarter 2013

Highlights

Quarter Ended

For the Six Months Ended

June

June

%

June 

June

%

2014

2013

Change

2014

2013

Change

(in thousands except per unit and per ton)

(in thousands except per unit and per ton)

Revenues

Total revenues and other income

$ 90,561

$ 86,804

4%

$ 170,870

$ 181,136

-6%

Coal production (tons)

11,851

14,894

-20%

24,103

28,727

-16%

Average coal royalty revenue per ton

$     3.86

$     3.91

-1%

$       3.70

$       3.92

-6%

Coal royalty revenues

$ 45,763

$ 58,210

-21%

$   89,298

$ 112,652

-21%

Other coal related revenue

$   9,598

$   9,197

4%

$   18,436

$   32,598

-43%

Total coal related revenues

$ 55,361

$ 67,407

-18%

$ 107,734

$ 145,250

-26%

Aggregates and industrial minerals related revenue(1)

$ 12,964

$ 10,781

20%

$   26,139

$   20,785

26%

Oil and gas related revenue

$ 17,822

$   4,093

335%

$   27,880

$     5,856

376%

Operating Expenses

$ 40,158

$ 31,472

28%

$   68,028

$   63,276

8%

Net income 

Net income to limited partners

$ 30,779

$ 40,244

-24%

$   62,732

$   87,192

-28%

Net income per unit

$     0.28

$     0.37

-24%

$       0.57

$       0.80

-29%

Average units outstanding

110,403

109,812

1%

110,127

109,352

1%

Net income before considering the impairment(1)

Net income to limited partners

36,290

40,678

-11%

68,243

87,911

-22%

Net income per unit

$     0.33

$     0.37

-11%

$       0.62

$       0.80

-23%

Distributable cash flow(2)

$ 64,944

$ 90,650

-28%

$ 103,871

$ 135,135

-23%

EBITDA(2)

$ 77,178

$ 76,068

1%

148,898

156,683

-5%

EBITDA margin(2)

85%

88%

-3%

87%

87%

0%

(1)

Aggregates and industrial minerals include the equity and other unconsolidated investment income associated with the OCI Wyoming soda ash business.

(2)

See "Non-GAAP Financial Measures" and reconciliation tables at the end of the release.

 

Revenues and other income Second quarter 2014 total revenues and other income increased 4% from the same period of 2013.  NRP benefitted from its diversification into other asset classes, as revenues other than coal related revenues more than offset the declines experienced in coal related revenues.  Coal production volumes decreased 20% to 11.9 million tons, while average coal royalty revenue per ton decreased 1% to $3.86 per ton, which led to a 21% reduction in coal royalty revenues to $45.8 million from the second quarter 2013.  The reductions in production and price realizations were primarily related to NRP's Appalachian properties.

Metallurgical coal accounted for 36% of NRP's coal production and 43% of its coal royalty revenues for the second quarter of 2014 compared to 28% of production and 40% of coal royalty revenues in the second quarter of 2013.    

Revenues other than coal related revenues nearly doubled from the second quarter 2013 primarily due to increased oil and gas revenues and our investment in the soda ash business.

Oil and gas revenues increased nearly six-fold over the second quarter of 2013 to $10.1 million, primarily due to the revenues generated by NRP's Williston Basin properties acquired in the second half of 2013.  NRP also recognized a 19% increase in the equity income associated with NRP's investment in the soda ash business due to both an increase in net income for the business as well as 23 additional days of income in 2014 over 2013.

Operating expenses Total operating expenses for the second quarter 2014 rose $8.7 million to $40.2 million from the second quarter 2013.  The increase was mainly due to $2.3 million of operating expenses associated with NRP's Williston Basin oil and gas properties acquired in the second half of 2013, and a $5.6 million asset impairment expense recorded in 2014.  

Net income attributable to the limited partners Net income attributable to the limited partners and net income per unit decreased in the second quarter of 2014 compared to the 2013 period to $30.8 million, or $0.28 per unit, from $40.2 million or $0.37 per unit.  Approximately half of the decrease was associated with the non-cash impairment charge.  Before considering the impairment, net income attributable to the limited partners and net income per unit were $36.3 million and $0.33 per unit, respectively.

Distributable cash flow Distributable cash flow decreased by 28% to $64.9 from $90.7 million mainly due to $12.1 million less in distributions from OCI and increased interest expense. 

EBITDA EBITDA for the second quarter 2014 remained relatively flat at $77.2 million compared to the EBITDA generated in the second quarter 2013 of $76.1 million

Second Quarter 2014 compared to First Quarter 2014

Highlights

Quarter Ended

June 2014

March 2014

% Change

(in thousands, except per ton and per unit)

Revenues and other income

Total revenues and other income

$   90,561

$      80,309

13%

Coal production (tons)

11,851

12,252

-3%

Average coal royalty revenue per ton

$       3.86

$          3.55

9%

Coal royalty revenues

$   45,763

$      43,536

5%

Other coal related revenue

$     9,598

$        8,837

9%

Total coal related revenue

$   55,361

$      52,373

6%

Aggregates and industrial minerals related revenue(1)

$   12,964

$      13,175

-2%

Oil and gas related revenue

$   17,822

$      10,058

77%

Operating expenses

$   40,158

$      27,870

44%

Net income

Net income to limited partners

$   30,779

$      31,953

-4%

Net income to the limited partners, before considering the impairment(1)

$   36,290

$      31,953

14%

Net income per unit

$       0.28

$          0.29

-4%

Net income per unit, before considering the impairment(1)

$       0.33

$          0.29

13%

Average units outstanding

110,403

109,848

1%

Distributable cash flow(2)

$   64,944

$      38,927

67%

EBITDA(2)

$   77,178

$      71,720

8%

EBITDA margin(2)

85%

89%

-5%

(1)

Aggregates and industrial minerals include the equity and other unconsolidated investment income associated with the OCI Wyoming soda ash business.

(2)

See "Non-GAAP Financial Measures" and reconciliation tables at the end of the release.

 

Revenues and other income Total revenues and other income for the second quarter increased $10.3 million or 13% from the first quarter, predominantly due to a $3.0 million increase in coal related revenues and a $7.8 million increase in oil and gas revenues. In the second quarter, NRP realized increased coal royalty revenues due to increased average realizations per ton of coal, relative to the first quarter, and increased oil and gas revenue due to increased oil and gas activity.  The increased realizations were mainly due to the mix of coal properties.

Operating expenses Operating expenses increased $12.3 million over the previous quarter predominantly due to the following:

  • Increased depreciation, depletion and amortization (non-cash) of $1.7 million due to production from higher cost properties in this quarter versus the previous quarter
  • Impairment charge (non-cash) of $5.6 million
  • Increased general and administrative expenses of $3.2 million were mainly due to a negative accrual for the long term incentive plan in the first quarter due to the drop in unit price.   The second quarter reflects more of a normal accrual.
  • Increased property, franchise and other taxes of $1.3 million predominantly due to severance taxes on oil and gas income

Net income attributable to the limited partners Net income attributable to the limited partners and net income per unit decreased in the second quarter from the previous quarter by $1.2 million and $0.01 per unit, respectively.  Before considering the non-cash impairment charge taken in the second quarter, net income attributable to the limited partners would have increased by $4.3 million to $36.3 million while net income per unit would have increased by $0.04 to $0.33 per unit.

Distributable cash flow Distributable cash flow increased to $64.9 million, up from $38.9 million reported in the first quarter mainly due to changes in the balance sheet included in net cash provided by operating activities, as well as additional distributions received from OCI in the second quarter.

EBITDA EBITDA for the second quarter 2014 increased over the first quarter by $5.5 million due to increased revenues. 

Distributions As reported on July 22, 2014, the Board of Directors of NRP's general partner declared a quarterly distribution of $0.35 per unit for the second quarter 2014.  

Company Profile Natural Resource Partners L.P. is a master limited partnership headquartered in Houston, TX, with its operations headquarters in Huntington, WV.  NRP is principally engaged in the business of owning and managing mineral reserve properties.  NRP owns interests in coal, aggregates and industrial minerals and oil and gas across the United States that generate royalty and other income for the partnership.  In addition, NRP owns an equity investment in OCI Wyoming, a trona/soda ash operation, and owns non-operated working interests in oil and gas properties.

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 any proceeds from the sale of assets plus the return on direct financing lease and contractual overrides shown in the cash flows from investing activities section of the cash flow statement.  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.

"EBITDA" is a non-GAAP financial measure that we define as earnings before interest, taxes, depreciation, depletion and amortization and asset impairment. "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. 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. EBITDA provides no information regarding a company's capital structure, borrowings, interest costs, capital expenditures, and working capital movement or tax positions. 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 EBITDA is useful in evaluating our financial performance because this measure is widely used by analysts and investors for comparative purposes. EBITDA is a financial measure widely used by investors in the high-yield bond market.  There are significant limitations to using 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 EBITDA reported by different companies.

"EBITDA margin" represents NRP's EBITDA as a percentage of total revenues and other income.

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, decreases in demand for coal, oil and gas, and aggregates and industrial minerals, including trona/soda ash; changes in operating conditions and costs; production cuts by our lessees; commodity prices; unanticipated geologic problems; 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.

-Financial statements follow-

 

Natural Resource Partners L.P.

Operating Statistics - Coal Related Revenue

(in thousands except per ton data)

Quarter Ended

For the Six Months Ended

June

June

June

June

2014

2013

2014

2013

(unaudited)

(unaudited)

Coal Royalties:

Coal royalty production (tons):

Appalachia

Northern

1,826

3,531

4,477

7,272

Central

5,288

5,826

9,664

10,946

Southern

949

1,163

1,933

2,267

Total Appalachia

8,063

10,520

16,074

20,485

Illinois Basin

3,416

3,012

6,538

5,906

Northern Powder River Basin

173

969

1,052

1,764

Gulf Coast 

199

393

439

572

Total

11,851

14,894

24,103

28,727

Average royalty revenue per ton:

Appalachia

Northern

$     1.07

$     1.20

$       0.91

$       1.25

Central

4.50

5.18

4.53

5.17

Southern

5.14

6.32

5.35

6.64

Total Appalachia

3.80

3.97

3.62

3.94

Illinois Basin

4.12

4.26

4.06

4.32

Northern Powder River Basin

2.09

2.37

2.83

2.51

Gulf Coast 

3.54

3.29

3.46

3.42

Combined average royalty revenue per ton

$     3.86

$     3.91

$       3.70

$       3.92

Coal royalty revenues:

Appalachia

Northern

$   1,958

$   4,242

$     4,096

$     9,126

Central

23,781

30,185

43,818

56,591

Southern

4,875

7,352

10,339

15,052

Total Appalachia

$ 30,614

$ 41,779

$   58,253

$   80,769

Illinois Basin

14,083

12,843

26,553

25,500

Northern Powder River Basin

362

2,295

2,972

4,424

Gulf Coast 

704

1,293

1,520

1,959

Total

$ 45,763

$ 58,210

$   89,298

$ 112,652

Other coal related revenues:

Override revenue

1,402

2,582

2,746

6,444

Transportation and processing fees

5,996

5,030

11,093

11,005

Minimums recognized as revenue

1,338

549

2,808

5,005

Reserve swap

-

-

-

8,149

Wheelage

862

1,036

1,789

1,995

Total other coal related revenues

$   9,598

$   9,197

$   18,436

$   32,598

Total coal revenues

$ 55,361

$ 67,407

$ 107,734

$ 145,250

 

Natural Resource Partners L.P.

Operating Statistics - Aggregates and Industrial Minerals

(in thousands except per ton data)

Quarter Ended

For the Six Months Ended

June

June

June

June

2014

2013

2014

2013

(unaudited)

(unaudited)

Aggregate royalty revenues and production

Tonnage

927

1,463

2,142

2,746

Average royalty per ton

$     0.69

$     1.20

$     0.99

$     1.20

  Total aggregate royalty revenues

$      644

$   1,751

$   2,125

$   3,303

  Other aggregate related revenue

$   2,919

$   1,148

$   4,834

$   2,552

Total aggregate related revenues

$   3,563

$   2,899

$   6,959

$   5,855

Equity and other unconsolidated investment earnings

$   9,401

$   7,882

$ 19,180

$ 14,930

Total aggregates and industrial minerals related revenue

$ 12,964

$ 10,781

$ 26,139

$ 20,785

Cash distributions received from OCI Wyoming

$ 13,923

$ 26,702

$ 25,568

$ 26,939

 

Natural Resource Partners L.P.

Operating Statistics - Oil and Gas

(in thousands except per unit data)

Quarter Ended

Six Months Ended

June

June

June

June

2014

2013

2014

2013

(unaudited)

(unaudited)

Williston Basin non-operated working interests

Production volumes

Oil (MBbls)

139

 N/A 

207

 N/A 

Natural gas (Mcf)

97

 N/A 

112

 N/A 

NGL (MBoe)

10

 N/A 

12

 N/A 

Average sales price per unit

Oil ($/Bbl)

$   93.40

 N/A 

$   95.86

 N/A 

Natural gas ($/Mcf)

$     5.71

 N/A 

$     7.54

 N/A 

NGL ($/Boe)

$   35.40

 N/A 

$   48.50

 N/A 

Revenues

Oil 

$ 12,982

 N/A 

$ 19,842

 N/A 

Natural gas 

$      554

 N/A 

$      844

 N/A 

NGL

$      354

 N/A 

$      582

 N/A 

  Total

$ 13,890

 N/A 

$ 21,268

 N/A 

Other oil and gas related revenues

$   3,932

$ 4,093

$   6,612

$ 5,856

Total oil and gas revenues

$ 17,822

$ 4,093

$ 27,880

$ 5,856

 

Natural Resource Partners L.P.

Consolidated Statements of Comprehensive Income

(in thousands, except per unit data)

Quarter Ended

For the Six Months Ended

June

June

June

June

2014

2013

2014

2013

(unaudited)

(unaudited)

Revenues and other income:

Coal related revenues

$ 55,361

$ 67,407

$    107,734

$ 145,250

Aggregate related revenues

3,563

2,899

6,959

5,855

Oil and gas related revenues

17,822

4,093

27,880

5,856

Equity and other unconsolidated investment income

9,401

7,882

19,180

14,930

Property taxes

3,378

3,849

7,345

7,796

Other

1,036

674

1,772

1,449

Total revenues and other income

90,561

86,804

170,870

181,136

Operating expenses:

Depreciation, depletion and amortization

16,350

17,411

30,997

32,173

Asset impairments

5,624

443

5,624

734

General and administrative

9,029

8,878

14,886

20,464

Property, franchise and other taxes

6,201

4,225

11,069

8,576

Oil and gas lease operating expenses

2,291

-

4,212

-

Transportation costs

462

328

884

787

Royalty payments

201

187

356

542

Total operating expenses

40,158

31,472

68,028

63,276

Income from operations

50,403

55,332

102,842

117,860

Other income (expense)

-

Interest expense

(19,037)

(14,440)

(38,897)

(29,103)

Interest income

41

173

67

214

Income before non-controlling interest

$ 31,407

$ 41,065

$      64,012

$   88,971

Non-controlling interest

-

-

-

-

Net income 

$ 31,407

$ 41,065

$      64,012

$   88,971

Net income attributable to:

General partner

$      628

$      821

$        1,280

$     1,779

Limited partners

$ 30,779

$ 40,244

$      62,732

$   87,192

Basic and diluted net income per

limited partner unit:

$     0.28

$     0.37

$          0.57

$       0.80

Weighted average number of units outstanding:

110,403

109,812

110,127

109,352

Comprehensive income 

$ 31,243

$ 41,116

$      63,748

$   89,076

 

Natural Resource Partners L.P.

Consolidated Statements of Cash Flow

(in thousands, except per unit data)

Quarter Ended

For the Six Months Ended

June

June

June

June 

2014

2013

2014

2013

(unaudited)

(unaudited)

Cash flows from operating activities:

Net income 

$ 31,407

$   41,065

$  64,012

$   88,971

Adjustments to reconcile net income to 

net cash provided by operating activities:

Depreciation, depletion and amortization

16,350

17,411

30,997

32,173

Gain on reserve swap

-

-

-

(8,149)

Equity and other unconsolidated investment income

(9,401)

(7,882)

(19,180)

(14,930)

Distributions of earnings from unconsolidated investments

10,290

15,925

21,935

16,162

Non-cash interest charge, net

721

279

1,468

555

Gain on sale of assets

-

-

-

(150)

Asset impairment

5,624

443

5,624

734

Change in operating assets and liabilities:

Accounts receivable

3,375

4,781

(3,685)

4,250

Other assets

336

(3,251)

318

(2,985)

Accounts payable and accrued liabilities

1,257

1,094

(413)

221

Accrued interest

(6,145)

1,349

(1,772)

(576)

Deferred revenue

3,357

5,445

7,099

9,951

Accrued incentive plan expenses

2,149

2,036

(5,916)

(1,219)

Property, franchise and other taxes payable

1,688

1,041

(849)

(1,359)

Net cash provided by operating activities:

61,008

79,736

99,638

123,649

Cash flows from investing activities:

Oil and gas capital expenditures

(6,319)

-

(8,123)

Acquisition of land, coal, other mineral rights, and related intangibles

(768)

-

(768)

-

Acquisition or construction of plant and equipment

(135)

-

(135)

-

Acquisition of equity interests

-

(40)

-

(292,979)

Distributions from unconsolidated investments

3,633

10,777

3,633

10,777

Proceeds from sale of assets

-

-

-

154

Return on direct financing lease and contractual override

303

137

600

555

Net cash used in investing activities

(3,286)

10,874

(4,793)

(281,493)

Cash flows from financing activities:

Proceeds from loans

-

43,000

2,000

243,000

Repayment of loans

(12,317)

(42,916)

(53,483)

(79,538)

Deferred financing costs

-

-

-

(1,621)

Proceeds from issuance of common units

9,329

-

13,842

75,000

Capital contribution by general partner

255

-

347

1,531

Costs associated with equity transactions

(381)

(13)

(438)

(60)

Distributions to partners

(39,421)

(61,630)

(79,613)

(124,688)

Net cash provided by (used in) financing activities

(42,535)

(61,559)

(117,345)

113,624

Net (decrease)  in cash and cash equivalents

15,187

29,051

(22,500)

(44,220)

Cash and cash equivalents at beginning of period

54,826

76,153

92,513

149,424

Cash and cash equivalents at end of period

$ 70,013

$ 105,204

$  70,013

$ 105,204

Supplemental cash flow information:

Cash paid during the period for interest

$ 24,432

$   12,784

$  39,135

$   29,085

 

Natural Resource Partners L.P.

Consolidated Balance Sheets

(in thousands, except for unit information)

ASSETS

June 

December 31,

2014

2013

(unaudited)

Current assets:

Cash and cash equivalents

$      70,013

$         92,513

Accounts receivable, net of allowance for doubtful accounts

34,718

33,737

Accounts receivable - affiliates

9,018

7,666

Other

1,291

1,691

Total current assets

115,040

135,607

Land

24,340

24,340

Plant and equipment, net

24,035

26,435

Mineral rights, net

1,391,439

1,405,455

Intangible assets, net

59,549

66,950

Equity and other unconsolidated investments

262,661

269,338

Loan financing costs, net

10,357

11,502

Long-term contracts receivable - affiliate

50,787

51,732

Other assets, net

600

497

Total assets

$ 1,938,808

$    1,991,856

LIABILITIES AND PARTNERS' CAPITAL

Current liabilities:

Accounts payable and accrued liabilities

$      11,765

$           8,659

Accounts payable - affiliates

445

391

Current portion of long-term debt

80,983

80,983

Accrued incentive plan expenses - current portion

6,880

8,341

Property, franchise and other taxes payable

6,981

7,830

Accrued interest

15,412

17,184

Total current liabilities

122,466

123,388

Deferred revenue

149,685

142,586

Accrued incentive plan expenses

6,071

10,526

Other non-current liabilities

9,712

14,341

Long-term debt

1,033,041

1,084,226

Partners' capital:

Common units outstanding ( 110,869,513 and 109,812,408)

609,001

606,774

General partner's interest

10,124

10,069

Non-controlling interest

(650)

324

Accumulated other comprehensive loss

(642)

(378)

Total partners' capital

617,833

616,789

Total liabilities and partners' capital

$ 1,938,808

$    1,991,856

 

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"

Quarter Ended

For the Six Months Ended

June

June

June

June

2014

2013

2014

2013

(unaudited)

(unaudited)

Net cash provided by operating activities

$ 61,008

$ 79,736

$   99,638

$ 123,649

Return on direct financing lease and contractual override

303

137

600

555

Distributions from unconsolidated investments(1)

3,633

10,777

3,633

10,777

Proceeds from sale of assets

-

-

-

154

Distributable cash flow

$ 64,944

$ 90,650

$ 103,871

$ 135,135

Reconciliation of GAAP "Net cash provided by operating activities"

to Non-GAAP "Distributable cash flow"

Quarter Ended

June

March

2014

2013

(unaudited)

Net cash provided by operating activities

$ 61,008

$ 38,630

Return on direct financing lease and contractual override

303

297

Distributions from unconsolidated investments(1)

3,633

-

Proceeds from sale of assets

-

-

Distributable cash flow

$ 64,944

$ 38,927

 

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 "EBITDA"

Quarter Ended

For the Six Months Ended

June

June

June

June

2014

2013

2014

2013

(unaudited)

(unaudited)

Net income

$ 31,407

$ 41,065

$      64,012

$   88,971

Add depreciation, depletion and amortization

16,350

17,411

30,997

32,173

Add asset impairments

5,624

443

5,624

734

Add interest expense, gross

19,037

14,440

38,897

29,103

Add depreciation, depletion and amortization and interest relating to OCI Wyoming

4,760

2,709

9,368

5,702

EBITDA

$ 77,178

$ 76,068

$    148,898

$ 156,683

EBITDA margin

EBITDA

$ 77,178

$ 76,068

$    148,898

$ 156,683

Total revenues

$ 90,561

$ 86,804

$    170,870

$ 181,136

EBITDA margin

85%

88%

87%

87%

Reconciliation of GAAP "Net income"

to Non-GAAP "EBITDA"

Quarter Ended

June

March 

2014

2014

(unaudited)

Net income

$ 31,407

$ 32,605

Add depreciation, depletion and amortization

16,350

14,647

Add asset impairments

5,624

-

Add interest expense, gross

19,037

19,860

Add depreciation, depletion and amortization and interest relating to OCI Wyoming

4,760

4,608

EBITDA

$ 77,178

$ 71,720

EBITDA margin

EBITDA

$ 77,178

$ 71,720

Total revenues

$ 90,561

$ 80,309

EBITDA margin

85%

89%

 

Reconciliation of GAAP "Total operating costs and expenses"

to Non-GAAP "Total operating expenses before considering the impairment"

Quarter Ended

June 

June

2014

2013

(unaudited)

Operating expenses

Total operating expenses as reported

$ 40,158

$ 31,472

Impairments

$ (5,624)

$    (443)

Total operating costs before considering the impairment

$ 34,534

$ 31,029

Reconciliation of GAAP "Net income attributable to the limited partners"

to Non-GAAP "Net income attributable to the limited partners before considering the impairment"

Quarter Ended

June 

June

2014

2013

(unaudited)

Net income attributable to the limited partners

Net income as reported

$ 31,407

$ 41,065

Impairments

5,624

443

Net income before considering the impairment

$ 37,031

$ 41,508

Net income, before considering the impairment, attributable to:

  General partner

$      741

$      830

  Limited partners

$ 36,290

$ 40,678

Reconciliation of GAAP "Basic and diluted net income per unit"

to Non-GAAP "Net income per unit before considering the impairment"

Quarter Ended

June 

June

2014

2013

(unaudited)

Net income per unit

Net income per unit as reported

$     0.28

$     0.37

Adjustment for impairments

0.05

0.00

Net income per limited partner unit, before considering the impairment

$     0.33

$     0.37

Weighted number of units outstanding

110,403

109,812

* Numbers may not add due to rounding

 

Reconciliation of GAAP "Total operating costs and expenses"

to Non-GAAP "Total operating expenses before considering the impairment"

Quarter Ended

June 

March

2014

2014

(unaudited)

Operating expenses

Total operating expenses as reported

$ 40,158

$ 27,870

Impairments

(5,624)

-

Total operating costs before considering the impairment

$ 34,534

$ 27,870

Reconciliation of GAAP "Net income attributable to the limited partners"

to Non-GAAP "Net income attributable to the limited partners before considering the impairment"

Quarter Ended

June 

March

2014

2014

(unaudited)

Net income attributable to the limited partners

Net income as reported

$ 31,407

$ 32,605

Impairments

5,624

-

Net income before considering the impairment

$ 37,031

$ 32,605

Net income, before considering the impairment, attributable to:

  General partner

$      741

$      652

  Limited partners

$ 36,290

$ 31,953

Reconciliation of GAAP "Basic and diluted net income per unit"

to Non-GAAP "Net income per unit before considering the impairment"

Quarter Ended

June

March

2014

2014

(unaudited)

Net income per unit

Net income per unit as reported

$     0.28

$     0.29

Adjustment for impairments

0.05

-

Net income per limited partner unit, before considering the impairment

$     0.33

$     0.29

Weighted number of units outstanding

110,403

109,848

* Numbers may not add due to rounding

 

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SOURCE Natural Resource Partners L.P.



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