LISLE, Ill., April 20, 2017 /PRNewswire/ --
- Net loss attributable to SXCP was $129.3
million in the quarter, reflecting improved operating
performance, more than offset by $148.6
million of deferred tax expense related to the change in the
Qualifying Income regulations finalized by the Internal Revenue
Services ("IRS")
- Adjusted EBITDA attributable to SXCP was $50.9 million for the quarter, up $3.6 million versus the prior year period,
driving strong Distributable Cash Flow and Distribution Cash
Coverage Ratio of $37.1 million and
1.26x, respectively
- Declared first quarter 2017 distribution of $0.5940 per unit
- Reaffirm full-year 2017 Adjusted EBITDA attributable to SXCP
guidance of $210 million to $220
million
- Discussions with General Partner SXC regarding the proposed
Simplification Transaction were terminated with no agreement
reached
SunCoke Energy Partners, L.P. (NYSE: SXCP) today reported
improved operating results for the first quarter 2017 versus the
prior year period primarily driven by improved logistics
volumes. Also in the quarter, the Partnership recorded
$148.6 million of deferred tax
expense related to the change in the Qualifying Income regulations
finalized by the IRS in January
2017.
"From an operational perspective, we are pleased with our first
quarter performance and are well-positioned to deliver upon our
financial guidance in 2017," said Fritz
Henderson, Chairman, President and Chief Executive Officer
of SunCoke Energy Partners, L.P. "Our first quarter results
reflect the impact from the finalized IRS Qualifying Income
regulations, and we will be working to formulate a strategy to
transition to a taxpaying entity over time."
The Partnership also announced the termination of discussions
with its sponsor, SunCoke Energy, Inc., regarding the proposed
Simplification Transaction, which SXC announced on October 31, 2016. The Conflicts Committee and its
independent advisors reviewed the proposal and had several
discussions with SXC over the last few months regarding the
potential transaction. At this time, the parties have determined
that they will not be able to reach an agreement and have therefore
terminated discussions regarding the Simplification
Transaction.
"While both SXC and the Conflicts Committee see benefits of a
simplified structure, the parties were unable to agree on a value,
through the exchange ratio, for the unaffiliated LP units," said
Henderson. "Going forward, we remain well-positioned to leverage
SXCP's strong competitive advantages in cokemaking and logistics to
capitalize on the continued improvement in the steel and coal
markets."
|
FIRST QUARTER
RESULTS
|
|
|
Three Months Ended
March 31,
|
|
(Dollars in
millions)
|
2017
|
|
2016
|
|
Increase/
(Decrease)
|
|
Revenues
|
$
|
195.6
|
|
|
$
|
194.5
|
|
|
$
|
1.1
|
|
|
Adjusted
EBITDA(1)
|
$
|
51.7
|
|
|
$
|
48.2
|
|
|
$
|
3.5
|
|
|
Net income
attributable to SXCP
|
$
|
(129.3)
|
|
|
$
|
39.8
|
|
|
$
|
(169.1)
|
|
|
|
|
(1)
|
See definition of
Adjusted EBITDA and reconciliation elsewhere in this
release.
|
Revenues in first quarter 2017 increased $1.1 million from the same prior year period,
driven by higher sales volumes in our Coal Logistics segment,
mostly offset by lower volumes in our Domestic Coke segment for
which the Partnership received make-whole payments from its
customer.
Adjusted EBITDA in the quarter increased $3.5 million primarily due to the impact of
higher volumes in our Coal Logistics segment, partially offset by
unfavorable coal cost recovery and Middletown's return to a normalized run-rate
performance in our Domestic Coke segment.
Net loss attributable to SXCP in the first quarter 2017 was
$129.3 million, reflecting the
improved operating performance described above, was more than
offset by $148.6 million of deferred
income tax expense described below as well as the absence of
$20.4 million of debt extinguishment
gains recorded in the prior year period.
In January 2017, the Internal
Revenue Service ("IRS") announced its decision to exclude
cokemaking as a qualifying income generating activity in its final
regulations (the "Final Regulations") issued under section
7704(d)(1)(E) of the Internal Revenue Code relating to the
qualifying income exception for publicly traded partnerships.
However, the Final Regulations include a 10-year transition period
for activities that were reasonably interpreted to be qualifying
income and carried on by publicly traded partnerships prior to the
Final Regulations. The Partnership previously received a will-level
opinion from its counsel, Vinson & Elkins LLP, that the
Partnership's cokemaking operations generated qualifying income
prior to the Final Regulations. Therefore, the Partnership believes
it had a reasonable basis to conclude its cokemaking operations
were considered qualifying income before the issuance of the new
regulations and as such expects to maintain its treatment as a
partnership through the 10-year transition period. After the
10-year transition period, cokemaking entities in the Partnership
will become taxable as corporations.
As a result of the Final Regulations, the Partnership recorded
deferred income tax expense of $148.6
million during the three months ended March 31, 2017, primarily related to differences
in the book and tax basis of fixed assets, which are expected to
exist at the end of the 10-year transition period when the
cokemaking operations become taxable. A portion of this deferred
tax liability, $3.0 million, was
attributable to SunCoke's retained ownership interest in the
cokemaking facilities and, therefore, was also reflected as a
reduction in noncontrolling interest during the three months ended
March 31, 2017.
FIRST QUARTER SEGMENT INFORMATION
Domestic Coke
Domestic Coke consists of cokemaking
facilities and heat recovery operations at our Haverhill,
Middletown and Granite City cokemaking facilities, located in
Franklin Furnace and Middletown, Ohio, and Granite City, Illinois, respectively.
|
Three Months Ended
March 31,
|
|
(Dollars in
millions, except per ton amounts)
|
2017
|
|
2016
|
|
Increase/
(Decrease)
|
|
Revenues
|
$
|
173.2
|
|
|
$
|
178.9
|
|
|
$
|
(5.7)
|
|
|
Adjusted
EBITDA(1)
|
$
|
42.5
|
|
|
$
|
46.3
|
|
|
$
|
(3.8)
|
|
|
Sales Volume
(thousands of tons)
|
564
|
|
|
581
|
|
|
(17)
|
|
|
Adjusted EBITDA per
ton(2)
|
$
|
75.35
|
|
|
$
|
79.69
|
|
|
$
|
(4.34)
|
|
|
|
|
(1)
|
See definition of
Adjusted EBITDA and reconciliation elsewhere in this
release.
|
|
(2)
|
Reflects Domestic
Coke Adjusted EBITDA divided by Domestic Coke sales
volumes.
|
|
|
|
•
|
Revenues decreased
$5.7 million, reflecting a decrease in sales volume of 17 thousand
tons, driven by lower sales to AK Steel at Haverhill, for which AK
Steel made make-whole payments, as well as unfavorable coal cost
recovery.
|
|
•
|
Adjusted EBITDA
decreased $3.8 million, driven by unfavorable coal cost recovery
and Middletown's return to a normalized run-rate performance after
a record performance in 2016.
|
|
|
Coal Logistics
Coal Logistics consists of the coal
handling and mixing services operated by SXCP at Convent Marine
Terminal ("CMT") located on the Mississippi river in Louisiana, Lake Terminal in East Chicago, Indiana and Kanawha River
Terminals, LLC ("KRT"), which has terminals along the Ohio and
Kanawha rivers in West
Virginia.
|
Three Months Ended
March 31,
|
|
(Dollars in
millions, except per ton amounts)
|
2017
|
|
2016
|
|
Increase/
(Decrease)
|
|
Revenues
|
$
|
22.4
|
|
|
$
|
15.6
|
|
|
$
|
6.8
|
|
|
Intersegment
sales
|
$
|
1.8
|
|
|
$
|
1.5
|
|
|
$
|
0.3
|
|
|
Adjusted
EBITDA(1)
|
$
|
13.0
|
|
|
$
|
5.9
|
|
|
$
|
7.1
|
|
|
Tons handled
(thousands of tons)(2)
|
5,449
|
|
|
4,035
|
|
|
1,414
|
|
|
CMT take-or-pay
shortfall tons (thousands of tons)(3)
|
544
|
|
|
1,638
|
|
|
(1,094)
|
|
|
|
|
(1)
|
See definition of
Adjusted EBITDA and reconciliation elsewhere in this
release.
|
|
(2)
|
Reflects inbound tons
handled during the period.
|
|
(3)
|
Reflects tons billed
under take-or-pay contracts where services have not yet been
performed.
|
|
|
|
•
|
Revenues and Adjusted
EBITDA were up $6.8 million and $7.1 million, respectively, driven
by higher sales volumes at our CMT and KRT terminals in the current
year period.
|
|
|
Corporate and Other
Corporate and other expenses of
$3.8 million in first quarter 2017
were consistent with the prior year period.
RELATED COMMUNICATIONS
We will host our quarterly earnings call at 10:00 a.m.
Eastern Time (9:00 a.m. Central Time)
today. The conference call will be webcast live and archived for
replay in the Investors section of www.suncoke.com. Investors
may participate in this call by dialing 1-866-393-4306 in the U.S.
or 1-617-826-1698 if outside the U.S., confirmation code
3359512.
SUNCOKE ENERGY PARTNERS, L.P.
SunCoke Energy Partners, L.P. (NYSE: SXCP) is a publicly traded
master limited partnership that manufactures high-quality coke used
in the blast furnace production of steel and provides export and
domestic coal handling services to the coke, coal, steel and power
industries. In our cokemaking business, we utilize an
innovative heat-recovery technology that captures excess heat for
steam or electrical power generation and have long-term,
take-or-pay coke contracts that pass through commodity and certain
operating costs. Our coal handling terminals have the
collective capacity to blend and transload more than 35 million
tons of coal each year and are strategically located to reach Gulf
Coast, East Coast, Great Lakes and international ports.
SXCP's General Partner is a wholly owned subsidiary of SunCoke
Energy, Inc. (NYSE: SXC), which has more than 50 years of
cokemaking experience serving the integrated steel industry.
To learn more about SunCoke Energy Partners, L.P., visit our
website at www.suncoke.com.
DEFINITIONS
|
•
|
Adjusted
EBITDA represents earnings before interest, (gain) loss on
extinguishment of debt, taxes, depreciation and amortization,
adjusted for Coal Logistics changes to our contingent consideration
liability related to our acquisition of CMT and the expiration of
certain acquired contractual obligations. Adjusted EBITDA does not
represent and should not be considered an alternative to net income
or operating income under GAAP and may not be comparable to other
similarly titled measures in other businesses. Management believes
Adjusted EBITDA is an important measure of the operating
performance and liquidity of the Partnership's net assets and its
ability to incur and service debt, fund capital expenditures and
make distributions. Adjusted EBITDA provides useful information to
investors because it highlights trends in our business that may not
otherwise be apparent when relying solely on GAAP measures and
because it eliminates items that have less bearing on our operating
performance and liquidity. EBITDA and Adjusted EBITDA are not
measures calculated in accordance with GAAP, and they should not be
considered an alternative to net income, operating cash flow or any
other measure of financial performance presented in accordance with
GAAP.
|
|
|
|
•
|
Adjusted EBITDA
attributable to SXCP equals Adjusted EBITDA less Adjusted
EBITDA attributable to noncontrolling interests.
|
|
|
|
•
|
Distributable Cash
Flow equals Adjusted EBITDA plus sponsor support and Coal
Logistics deferred revenue; less net cash paid for interest
expense, ongoing capital expenditures, accruals for replacement
capital expenditures and cash distributions to noncontrolling
interests; plus amounts received under the Omnibus Agreement and
acquisition expenses deemed to be Expansion Capital under our
Partnership Agreement. Distributable Cash Flow is a non-GAAP
supplemental financial measure that management and external users
of SXCP's financial statements, such as industry analysts,
investors, lenders and rating agencies use to assess:
|
|
|
|
•
|
SXCP's operating performance as compared to other
publicly traded partnerships, without regard to historical cost
basis;
|
|
•
|
the ability of SXCP's
assets to generate sufficient cash flow to make distributions to
SXCP's unitholders;
|
|
•
|
SXCP's ability to
incur and service debt and fund capital expenditures;
and
|
|
•
|
the viability of
acquisitions and other capital expenditure projects and the returns
on investment of various investment opportunities.
|
|
|
|
|
We believe that
Distributable Cash Flow provides useful information to investors in
assessing SXCP's financial condition and results of
operations. Distributable Cash Flow should not be considered
an alternative to net income, operating income, cash flows from
operating activities, or any other measure of financial performance
or liquidity presented in accordance with GAAP. Distributable
Cash Flow has important limitations as an analytical tool because
it excludes some, but not all, items that affect net income and net
cash provided by operating activities and used in investing
activities. Additionally, because Distributable Cash Flow may
be defined differently by other companies in the industry, our
definition of Distributable Cash Flow may not be comparable to
similarly titled measures of other companies, thereby diminishing
its utility.
|
|
|
|
•
|
Ongoing capital
expenditures ("capex") are capital expenditures made to
maintain the existing operating capacity of our assets and/or to
extend their useful lives. Ongoing capex also includes new
equipment that improves the efficiency, reliability or
effectiveness of existing assets. Ongoing capex does not include
normal repairs and maintenance, which are expensed as incurred, or
significant capital expenditures. For purposes of calculating
distributable cash flow, the portion of ongoing capex attributable
to SXCP is used and includes capital expenditures included in
working capital at the end of the period.
|
|
|
|
•
|
Replacement
capital expenditures ("capex") represents an annual accrual
necessary to fund SXCP's share of the estimated costs to replace or
rebuild our facilities at the end of their working lives. This
accrual is estimated based on the average quarterly anticipated
replacement capital that we expect to incur over the long term to
replace our major capital assets at the end of their working lives.
The replacement capex accrual estimate will be subject to review
and prospective change by SXCP's general partner at least annually
and whenever an event occurs that causes a material adjustment of
replacement capex, provided such change is approved by our
conflicts committee.
|
|
|
|
•
|
Simplification
Transaction SunCoke's proposal, made on October 31, 2016, to
acquire all of the Partnership's common units not already owned by
SunCoke.
|
FORWARD-LOOKING STATEMENTS
Some of the statements included in this press release constitute
"forward-looking statements." Forward-looking statements
include all statements that are not historical facts and may be
identified by the use of such words as "believe," "expect," "plan,"
"project," "intend," "anticipate," "estimate," "predict,"
"potential," "continue," "may," "will," "should" or the negative of
these terms or similar expressions. Forward-looking
statements are inherently uncertain and involve significant known
and unknown risks and uncertainties (many of which are beyond the
control of SXCP) that could cause actual results to differ
materially.
Such risks and uncertainties include, but are not limited to,
domestic and international economic, political, business,
operational, competitive, regulatory, and/or market factors
affecting SXCP, as well as uncertainties related to: pending or
future litigation, legislation or regulatory actions; liability for
remedial actions or assessments under existing or future
environmental regulations; gains and losses related to acquisition,
disposition or impairment of assets; recapitalizations; access to,
and costs of, capital; the effects of changes in accounting rules
applicable to SXCP; and changes in tax, environmental and other
laws and regulations applicable to SXCP's businesses.
Forward-looking statements are not guarantees of future
performance, but are based upon the current knowledge, beliefs and
expectations of SXCP management, and upon assumptions by SXCP
concerning future conditions, any or all of which ultimately may
prove to be inaccurate. The reader should not place undue
reliance on these forward-looking statements, which speak only as
of the date of this press release. SXCP does not intend, and
expressly disclaims any obligation, to update or alter its
forward-looking statements (or associated cautionary language),
whether as a result of new information, future events or otherwise
after the date of this press release except as required by
applicable law.
SXCP has included in its filings with the Securities and
Exchange Commission cautionary language identifying important
factors (but not necessarily all the important factors) that could
cause actual results to differ materially from those expressed in
any forward-looking statement made by SXCP. For information
concerning these factors, see SXCP's Securities and Exchange
Commission filings such as its annual and quarterly reports and
current reports on Form 8-K, copies of which are available free of
charge on SXCP's website at www.suncoke.com. All
forward-looking statements included in this press release are
expressly qualified in their entirety by such cautionary
statements. Unpredictable or unknown factors not discussed in
this release also could have material adverse effects on
forward-looking statements.
|
SunCoke Energy
Partners, L.P.
|
|
Consolidated
Statements of Operations
|
|
(Unaudited)
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
(Dollars and units
in millions,
except per unit
amounts)
|
|
Revenues
|
|
|
|
|
|
Sales and other
operating revenue
|
|
$
|
195.6
|
|
|
$
|
194.5
|
|
|
Costs and
operating expenses
|
|
|
|
|
|
Cost of products sold
and operating expenses
|
|
135.4
|
|
|
134.2
|
|
|
Selling, general and
administrative expenses
|
|
8.5
|
|
|
8.4
|
|
|
Depreciation and
amortization expense
|
|
21.6
|
|
|
18.7
|
|
|
Total costs and
operating expenses
|
|
165.5
|
|
|
161.3
|
|
|
Operating
income
|
|
30.1
|
|
|
33.2
|
|
|
Interest expense,
net
|
|
12.6
|
|
|
12.5
|
|
|
Gain on
extinguishment of debt
|
|
—
|
|
|
(20.4)
|
|
|
Income before income
tax expense
|
|
17.5
|
|
|
41.1
|
|
|
Income tax
expense
|
|
149.2
|
|
|
0.6
|
|
|
Net (loss)
income
|
|
(131.7)
|
|
|
40.5
|
|
|
Less: Net (loss)
income attributable to noncontrolling interests
|
|
(2.4)
|
|
|
0.7
|
|
|
Net (loss) income
attributable to SunCoke Energy Partners, L.P.
|
|
$
|
(129.3)
|
|
|
$
|
39.8
|
|
|
|
|
|
|
|
General partner's
interest in net (loss) income
|
|
$
|
(1.3)
|
|
|
$
|
10.1
|
|
|
Limited partners'
interest in net (loss) income
|
|
$
|
(128.0)
|
|
|
$
|
29.7
|
|
|
Net (loss) income per
common unit (basic and diluted)
|
|
$
|
(2.77)
|
|
|
$
|
0.64
|
|
|
Weighted average
common units outstanding (basic and diluted)
|
|
46.2
|
|
|
46.2
|
|
|
SunCoke Energy
Partners, L.P.
|
|
Consolidated
Balance Sheets
|
|
|
|
|
|
|
|
March 31,
2017
|
|
December 31,
2016
|
|
|
(Unaudited)
|
|
|
|
|
(Dollars in
millions)
|
|
Assets
|
|
|
|
Cash and cash
equivalents
|
|
$
|
46.2
|
|
|
$
|
41.8
|
|
|
Receivables
|
|
40.1
|
|
|
39.7
|
|
|
Inventories
|
|
78.3
|
|
|
66.9
|
|
|
Other current
assets
|
|
4.2
|
|
|
1.6
|
|
|
Total current
assets
|
|
168.8
|
|
|
150.0
|
|
|
Properties, plants
and equipment (net of accumulated depreciation of $371.4 million
and $352.6 million at March 31, 2017 and December 31, 2016,
respectively)
|
|
1,281.8
|
|
|
1,294.9
|
|
|
Goodwill
|
|
73.5
|
|
|
73.5
|
|
|
Other intangible
assets, net
|
|
174.1
|
|
|
176.7
|
|
|
Deferred charges and
other assets
|
|
0.8
|
|
|
0.9
|
|
|
Total
assets
|
|
$
|
1,699.0
|
|
|
$
|
1,696.0
|
|
|
Liabilities and
Equity
|
|
|
|
|
|
Accounts
payable
|
|
$
|
67.9
|
|
|
$
|
47.0
|
|
|
Accrued
liabilities
|
|
11.1
|
|
|
11.7
|
|
|
Deferred
revenue
|
|
5.6
|
|
|
2.5
|
|
|
Current portion of
long-term debt and financing obligation
|
|
6.1
|
|
|
4.9
|
|
|
Interest
payable
|
|
6.2
|
|
|
14.7
|
|
|
Payable to affiliate,
net
|
|
6.0
|
|
|
4.7
|
|
|
Total current
liabilities
|
|
102.9
|
|
|
85.5
|
|
|
Long-term debt and
financing obligation
|
|
803.7
|
|
|
805.7
|
|
|
Deferred income
taxes
|
|
187.1
|
|
|
37.9
|
|
|
Other deferred
credits and liabilities
|
|
13.2
|
|
|
13.2
|
|
|
Total
liabilities
|
|
1,106.9
|
|
|
942.3
|
|
|
Equity
|
|
|
|
|
|
Held by
public:
|
|
|
|
|
|
Common
units (issued 20,804,877 and 20,800,181 units at March 31,
2017 and December 31, 2016, respectively)
|
|
227.0
|
|
|
296.9
|
|
|
Held by
parent:
|
|
|
|
|
|
Common units (issued
25,415,696 units at March 31, 2017 and December 31,
2016)
|
|
324.8
|
|
|
410.3
|
|
|
General partner
interest
|
|
28.8
|
|
|
32.1
|
|
|
Partners' capital
attributable to SunCoke Energy Partners, L.P.
|
|
580.6
|
|
|
739.3
|
|
|
Noncontrolling
interest
|
|
11.5
|
|
|
14.4
|
|
|
Total
equity
|
|
592.1
|
|
|
753.7
|
|
|
Total liabilities and
equity
|
|
$
|
1,699.0
|
|
|
$
|
1,696.0
|
|
|
SunCoke Energy
Partners, L.P.
|
|
Consolidated
Statements of Cash Flows
|
|
(Unaudited)
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
(Dollars in
millions)
|
|
Cash Flows from
Operating Activities:
|
|
|
|
|
|
Net (loss)
income
|
|
$
|
(131.7)
|
|
|
$
|
40.5
|
|
|
Adjustments to
reconcile net (loss) income to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
21.6
|
|
|
18.7
|
|
|
Deferred income tax
expense
|
|
149.2
|
|
|
0.3
|
|
|
Gain on
extinguishment of debt
|
|
—
|
|
|
(20.4)
|
|
|
Changes in working
capital pertaining to operating activities:
|
|
|
|
|
|
Receivables
|
|
(0.4)
|
|
|
(4.9)
|
|
|
Payables to
affiliate, net
|
|
1.3
|
|
|
2.2
|
|
|
Inventories
|
|
(11.4)
|
|
|
3.8
|
|
|
Accounts
payable
|
|
19.3
|
|
|
7.6
|
|
|
Accrued
liabilities
|
|
(0.6)
|
|
|
(0.3)
|
|
|
Deferred
revenue
|
|
3.1
|
|
|
9.2
|
|
|
Interest
payable
|
|
(8.5)
|
|
|
(10.9)
|
|
|
Other
|
|
(2.5)
|
|
|
(5.4)
|
|
|
Net cash provided by
operating activities
|
|
39.4
|
|
|
40.4
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
|
|
Capital
expenditures
|
|
(4.2)
|
|
|
(8.0)
|
|
|
Decrease in
restricted cash
|
|
0.1
|
|
|
7.4
|
|
|
Other investing
activities
|
|
—
|
|
|
0.6
|
|
|
Net cash used in
investing activities
|
|
(4.1)
|
|
|
—
|
|
|
Cash Flows from
Financing Activities:
|
|
|
|
|
|
Repayment of
long-term debt
|
|
(0.3)
|
|
|
(32.9)
|
|
|
Repayment of
financing obligation
|
|
(0.6)
|
|
|
—
|
|
|
Proceeds from
revolving credit facility
|
|
10.0
|
|
|
20.0
|
|
|
Repayment of
revolving credit facility
|
|
(10.0)
|
|
|
(20.0)
|
|
|
Distributions to
unitholders (public and parent)
|
|
(29.5)
|
|
|
(29.5)
|
|
|
Distributions to
noncontrolling interest (SunCoke Energy, Inc.)
|
|
(0.5)
|
|
|
(1.3)
|
|
|
Capital contributions
from SunCoke
|
|
—
|
|
|
8.4
|
|
|
Net cash used in
financing activities
|
|
(30.9)
|
|
|
(55.3)
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
4.4
|
|
|
(14.9)
|
|
|
Cash and cash
equivalents at beginning of period
|
|
41.8
|
|
|
48.6
|
|
|
Cash and cash
equivalents at end of period
|
|
$
|
46.2
|
|
|
$
|
33.7
|
|
|
Supplemental
Disclosure of Cash Flow Information
|
|
|
|
|
|
Interest
paid
|
|
$
|
20.9
|
|
|
$
|
24.3
|
|
|
SunCoke Energy
Partners, L.P.
|
|
Segment Operating
Data
|
|
The following tables
set forth financial and operating data for the three months ended
March 31, 2017 and 2016:
|
|
|
|
Three Months Ended
March 31,
|
|
2017
|
|
2016
|
|
|
|
|
|
(Dollars in
millions)
|
|
Sales and other
operating revenues:
|
|
|
|
|
Domestic
Coke
|
$
|
173.2
|
|
|
$
|
178.9
|
|
|
Coal
Logistics
|
22.4
|
|
|
15.6
|
|
|
Coal Logistics
intersegment sales
|
1.8
|
|
|
1.5
|
|
|
Elimination of
intersegment sales
|
(1.8)
|
|
|
(1.5)
|
|
|
Total
|
$
|
195.6
|
|
|
$
|
194.5
|
|
|
Adjusted
EBITDA(1):
|
|
|
|
|
Domestic
Coke
|
$
|
42.5
|
|
|
$
|
46.3
|
|
|
Coal
Logistics
|
13.0
|
|
|
5.9
|
|
|
Corporate and
Other
|
(3.8)
|
|
|
(4.0)
|
|
|
Total
|
$
|
51.7
|
|
|
$
|
48.2
|
|
|
Coke Operating
Data:
|
|
|
|
|
Domestic Coke
capacity utilization (%)
|
100
|
|
|
101
|
|
|
Domestic Coke
production volumes (thousands of tons)
|
567
|
|
|
576
|
|
|
Domestic Coke sales
volumes (thousands of tons)
|
564
|
|
|
581
|
|
|
Domestic Coke
Adjusted EBITDA per ton(2)
|
$
|
75.35
|
|
|
$
|
79.69
|
|
|
Coal Logistics
Operating Data:
|
|
|
|
|
Tons handled
(thousands of tons)(3)
|
5,449
|
|
|
4,035
|
|
|
CMT take-or-pay
shortfall tons (thousands of tons)(4)
|
544
|
|
|
1,638
|
|
|
|
|
|
(1)
|
See definition of
Adjusted EBITDA and reconciliation elsewhere in this
release.
|
|
(2)
|
Reflects Domestic
Coke Adjusted EBITDA divided by Domestic Coke sales
volumes.
|
|
(3)
|
Reflects inbound tons
handled during the period.
|
|
(4)
|
Reflects tons billed
under take-or-pay contracts where services have not yet been
performed.
|
|
SunCoke Energy
Partners, L.P.
|
|
Reconciliations of
Non-GAAP Information
|
|
Adjusted EBITDA to
Net (Loss) Income and Net Cash Provided by Operating
Activities
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
|
2017
|
|
2016(1)
|
|
|
|
|
|
|
|
(Dollars in
millions)
|
|
Net cash provided by
operating activities
|
|
$
|
39.4
|
|
|
$
|
40.4
|
|
|
Subtract:
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
21.6
|
|
|
18.7
|
|
|
Gain on
extinguishment of debt
|
|
—
|
|
|
(20.4)
|
|
|
Deferred income tax
expense
|
|
149.2
|
|
|
0.3
|
|
|
Changes in working
capital and other
|
|
0.3
|
|
|
1.3
|
|
|
Net (loss)
income
|
|
$
|
(131.7)
|
|
|
$
|
40.5
|
|
|
Add:
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
$
|
21.6
|
|
|
$
|
18.7
|
|
|
Interest expense,
net
|
|
12.6
|
|
|
12.5
|
|
|
Gain on
extinguishment of debt
|
|
—
|
|
|
(20.4)
|
|
|
Income tax expense,
net
|
|
149.2
|
|
|
0.6
|
|
|
Contingent
consideration adjustments(2)
|
|
—
|
|
|
(3.7)
|
|
|
Adjusted
EBITDA
|
|
$
|
51.7
|
|
|
$
|
48.2
|
|
|
Subtract:
|
|
|
|
|
|
Adjusted EBITDA
attributable to noncontrolling interest (3)
|
|
0.8
|
|
|
0.9
|
|
|
Adjusted EBITDA
attributable to SunCoke Energy Partners, L.P.
|
|
$
|
50.9
|
|
|
$
|
47.3
|
|
|
|
|
|
(1)
|
In response to the
SEC's May 2016 update to its guidance on the appropriate use of
non-GAAP financial measures, Adjusted EBITDA no longer includes
Coal Logistics deferred revenue until it is recognized as GAAP
revenue. As such, Adjusted EBITDA for the three months ended March
31, 2016 has been recast from previously reported results to
exclude coal logistics deferred revenue.
|
|
(2)
|
The Partnership
amended its contingent consideration terms with The Cline Group
during the first quarter of 2016. These amendments resulted
in a gain of $3.7 million recorded during the three months ended
March 31, 2016, which was excluded from Adjusted EBITDA.
|
|
(3)
|
Reflects net income
attributable to noncontrolling interest adjusted for noncontrolling
interest's share of interest, taxes, income, and depreciation and
amortization.
|
|
SunCoke Energy
Partners, L.P.
|
|
Reconciliations of
Non-GAAP Information
|
|
Reconciliation of
Adjusted EBITDA and
|
|
Distributable Cash
Flow to Net Loss
|
|
|
|
|
|
Three Months
Ended
March 31,
2017
|
|
|
(Dollars in
millions)
|
|
Net cash
provided by operating activities
|
|
$
|
39.4
|
|
Less:
|
|
|
|
Depreciation and
amortization expense
|
|
21.6
|
|
Deferred income tax
expense
|
|
149.2
|
|
Changes in working
capital and other
|
|
0.3
|
|
Net
loss
|
|
$
|
(131.7)
|
|
|
|
|
Add:
|
|
|
|
Depreciation and amortization expense
|
|
21.6
|
|
Interest
expense, net
|
|
12.6
|
|
Income
tax expense
|
|
149.2
|
|
Adjusted
EBITDA
|
|
$
|
51.7
|
|
|
|
|
Less:
|
|
|
|
Adjusted EBITDA attributable to noncontrolling
interest(1)
|
|
0.8
|
|
Adjusted
EBITDA attributable to SXCP
|
|
$
|
50.9
|
|
|
|
|
Plus:
|
|
|
|
Coal Logistics
deferred revenue(2)
|
|
3.2
|
|
|
|
|
Less:
|
|
|
|
Ongoing
capex
|
|
2.7
|
|
Replacement capex
accrual
|
|
1.9
|
|
Cash interest
accrual
|
|
11.8
|
|
Cash tax
accrual(3)
|
|
0.6
|
|
Distributable
cash flow
|
|
$
|
37.1
|
|
|
|
|
Quarterly Cash
Distribution
|
|
$
|
29.5
|
|
Distribution
Coverage Ratio(4)
|
|
1.26
|
|
|
|
|
(1)
|
Reflects net income
attributable to noncontrolling interest adjusted for noncontrolling
interest's share of interest, taxes, income, and depreciation and
amortization.
|
|
(2)
|
Coal Logistics
deferred revenue adjusts for coal and liquid tons the Partnership
did not handle, but are included in Distributable Cash Flow as the
associated take-or-pay fees are billed to the customer.
Deferred revenue on take-or-pay contracts is recognized into GAAP
income annually based on the terms of the contract, at which time
it will be excluded from Distributable Cash Flow.
|
|
(3)
|
Cash tax impact from
the operations of Gateway Cogeneration Company LLC, which is an
entity subject to income taxes for federal and state purposes at
the corporate level.
|
|
(4)
|
Distribution cash
coverage ratio is distributable cash flow divided by total
estimated distributions to the limited and general
partners.
|
|
SunCoke Energy
Partners, L.P.
|
|
Reconciliations of
Non-GAAP Information
|
|
Estimated 2017
Consolidated Adjusted EBITDA to Estimated Net Loss
|
|
and Net Cash
Provided by Operating Activities
|
|
|
|
|
|
2017
|
|
|
Low
|
|
High
|
|
Net Cash Provided
by Operating Activities
|
|
$
|
142
|
|
|
$
|
162
|
|
|
Subtract:
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
86
|
|
|
86
|
|
|
Deferred income tax
expense
|
|
149
|
|
|
149
|
|
|
Changes in working
capital and other
|
|
(17)
|
|
|
(11)
|
|
|
Net
loss
|
|
$
|
(76)
|
|
|
$
|
(62)
|
|
|
Add:
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
86
|
|
|
86
|
|
|
Interest expense,
net
|
|
52
|
|
|
48
|
|
|
Income tax
expense
|
|
151
|
|
|
151
|
|
|
Adjusted
EBITDA
|
|
$
|
213
|
|
|
$
|
223
|
|
|
Subtract: Adjusted
EBITDA attributable to noncontrolling
interest(1)
|
|
3
|
|
|
3
|
|
|
Adjusted EBITDA
attributable to SunCoke Energy Partners, L.P.
|
|
$
|
210
|
|
|
$
|
220
|
|
|
Add:
|
|
|
|
|
|
Corporate cost
holiday / deferral(2)
|
|
(8)
|
|
|
(8)
|
|
|
Subtract:
|
|
|
|
|
|
Ongoing capex (SXCP
share)
|
|
17
|
|
|
17
|
|
|
Replacement capex
accrual
|
|
8
|
|
|
8
|
|
|
Cash interest
accrual
|
|
48
|
|
|
48
|
|
|
Cash tax
accrual(3)
|
|
3
|
|
|
3
|
|
|
Estimated
distributable cash flow
|
|
$
|
126
|
|
|
$
|
136
|
|
|
|
|
|
(1)
|
Reflects net income
attributable to noncontrolling interest adjusted for noncontrolling
interest's share of interest, taxes, income, and depreciation and
amortization.
|
|
(2)
|
Represents repayment
of SXC corporate cost/IDR deferral from Q2 2016.
|
|
(3)
|
Cash tax impact from
the operations of Gateway Cogeneration Company LLC, which is an
entity subject to income taxes for federal and state purposes at
the corporate level.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/suncoke-energy-partners-lp-announces-solid-first-quarter-2017-results-discussions-on-proposed-simplification-transaction-terminated-300442431.html
SOURCE SunCoke Energy Partners, L.P.