Natural Resource Partners L.P. (NYSE:NRP) today reported
fourth quarter and full year 2021 results as follows:
For the Three
Months Ended
For the Year
Ended
(In thousands) (Unaudited)
December 31, 2021
Operating cash flow
$
55,161
$
121,804
Free cash flow (1)
55,702
122,967
Cash flow cushion (last twelve months)
(1)
36,172
Net income
$
55,641
$
108,902
Adjusted EBITDA (1)
66,850
161,354
(1) See "Non-GAAP Financial Measures" and
reconciliation tables at the end of this release.
"Strong demand for metallurgical coal, thermal coal and soda ash
in the fourth quarter produced one of the best quarters in terms of
free cash flow generation in the Partnership’s history," stated
Craig Nunez, NRP's President & Chief Operating Officer. "While
COVID-19 remains a risk factor for the global economy, we expect to
generate robust free cash flow in the months ahead and plan to
continue using that cash to pay down debt, solidify our capital
structure and maintain common unit distributions."
Mr. Nunez continued, "We also closed our first carbon
sequestration transaction in the fourth quarter, receiving $13.8
million in exchange for agreeing to sequester 1.1 million tonnes of
carbon dioxide ("CO2") in our West Virginia forestland. We
announced our second carbon sequestration transaction earlier this
quarter after granting Denbury the right to develop a world-class
subsurface CO2 sequestration project on 75,000 acres of underground
pore space we control in southwest Alabama, which Denbury believes
has the potential to store over 300 million tonnes of CO2. We
expect this project, if developed, to be the first of what will
potentially be numerous subsurface carbon sequestration projects
conducted on the approximately 3.5 million acres where we own the
rights to sequester CO2 underground across the United States. These
projects have the potential to provide important benefits to the
environment and add significant value to NRP over the coming
years.”
NRP's liquidity was $235.5 million at December 31, 2021,
consisting of $135.5 million of cash and $100.0 million of
borrowing capacity available under its revolving credit
facility.
NRP redeemed at par all 19,321 of its paid-in-kind 12.0% Class A
Convertible Preferred Units for $19.6 million in cash in accordance
with their terms and including accrued interest. Following the
redemption, no paid-in-kind preferred units remain outstanding.
Additionally, NRP declared a fourth quarter 2021 cash distribution
of $0.45 per common unit and a $7.5 million cash distribution on
the preferred units. Future distributions on NRP's common and
preferred units will be determined on a quarterly basis by the
Board of Directors. The Board of Directors considers numerous
factors each quarter in determining cash distributions, including
profitability, cash flow, debt service obligations, market
conditions and outlook, estimated unitholder income tax liability
and the level of cash reserves that the Board determines is
necessary for future operating and capital needs.
Segment Performance
Mineral Rights (segment formerly named Coal Royalty and
Other)
NRP has changed the name of its Coal Royalty and Other business
segment to Mineral Rights. This name change highlights NRP’s vast
mineral ownership interests as well as its intensifying focus on
leveraging the Partnership's asset footprint across the United
States, including subsurface carbon sequestration rights, to become
a key player in the transitional energy economy for the years to
come. There has been no change to the composition of this
reportable business segment or the structure of NRP's internal
organization in connection with this name change.
Mineral Rights net income for the fourth quarter and full year
of 2021 increased $38.1 million and $183.6 million, respectively,
as compared to the prior year periods. Free cash flow for the
fourth quarter and full year of 2021 increased $34.1 million and
$35.1 million, respectively, as compared to the prior year periods.
These increases were primarily due to stronger metallurgical coal
demand and pricing in 2021 and $13.8 million of cash received in
the fourth quarter of 2021 from the forestland carbon sequestration
transaction. In addition, full year 2021 net income improved due to
$130.8 million of higher asset impairments recorded in 2020.
Approximately 75% of coal royalty revenues and approximately 55% of
coal royalty sales volumes were derived from metallurgical coal in
the fourth quarter of 2021.
Metallurgical coal markets have rebounded significantly from the
lows seen in 2020 to record high pricing and the outlook remains
strong as steel demand driven by global economic recovery is more
than offsetting challenges related to the COVID-19 pandemic.
Domestic and export thermal coal markets have also significantly
improved from the lows seen in 2020, however NRP did not have
meaningful sensitivity to thermal coal price movements in 2021
since the substantial majority of NRP's thermal cash flows were
fixed pursuant to a contract with Foresight Energy that went into
effect as it emerged from bankruptcy in 2020. That contract expired
at the end of 2021 and NRP began receiving traditional royalty
payments in January 2022. While NRP may benefit from improved
thermal coal demand and pricing in the near term, thermal coal
markets still face the long-term challenges presented by
competition from natural gas and the secular shift to renewable
energy.
In addition, NRP continues to identify alternative revenue
sources across its large portfolio of land, mineral and timber
assets. The types of opportunities include the sequestration of
carbon dioxide underground and in standing forests, and the
generation of electricity using geothermal, solar and wind energy.
While the timing and likelihood of additional cash flows being
realized from further activities is uncertain, NRP believes its
large ownership footprint throughout the United States will provide
additional opportunities to create value in this regard with
minimal capital investment.
Soda Ash
In December, a publicly-traded Turkish conglomerate, Sisecam,
acquired a majority stake in the managing partner of Sisecam
Wyoming LLC, the business formerly known as Ciner Wyoming LLC.
Sisecam brings extensive experience and knowledge to NRP's soda ash
partnership given its soda ash operating experience in Turkey,
Bulgaria and Europe, as well as its container and flat glass
manufacturing around the world. NRP looks forward to working with
Sisecam to build on the significant value realized by the soda ash
partnership with the Ciner Group, which continues to own a minority
stake in the partnership.
Soda ash net income in the fourth quarter and full year of 2021
increased $5.1 million and $11.2 million, respectively, as compared
to the prior year period as demand and pricing for soda ash
continues to improve globally from the lows caused by the COVID-19
pandemic. As a result of the soda ash segment's improved
performance, Sisecam Wyoming reinstated regular quarterly cash
distributions in the fourth quarter of 2021, which were previously
suspended since the third quarter of 2020. Accordingly, free cash
flow in the fourth quarter of 2021 increased $7.3 million as
compared to the prior year period, but decreased $2.9 million for
the full year of 2021 as compared to the prior year due to the
regular quarterly cash distributions being suspended until the
fourth quarter of 2021.
Corporate and Financing
Corporate and financing costs in the fourth quarter and full
year of 2021 increased by $2.2 million and $1.0 million,
respectively, as compared to the prior year periods, primarily due
to an increase in incentive compensation as a result of
significantly improved operating results in 2021, partially offset
by lower interest expense as a result of less debt outstanding.
Free cash flow in the fourth quarter and full year of 2021 improved
$0.4 million and $2.1 million, respectively, as compared to prior
year periods primarily due to lower cash paid for interest as a
result of less debt outstanding in 2021.
As noted earlier, NRP declared a fourth quarter 2021 cash
distribution of $0.45 per common unit of NRP and a $7.5 million
cash distribution on the preferred units. NRP's consolidated
leverage ratio fell from 4.6x at December 31, 2020 to 2.7x at
December 31, 2021 and expects its leverage ratio to continue to
decline for the foreseeable future.
Conference Call
A conference call will be held today at 9:00 a.m. ET. To
register for the conference call, please use this link:
https://conferencingportals.com/event/kfJdSHYP. After registering a
confirmation will be sent via email, including dial in details and
unique conference call codes for entry. Registration is open
through the live call, however, to ensure you are connected for the
full call we suggest registering at least 10 minutes prior to the
start of the call. Investors may also listen to the call via the
Investor Relations section of the NRP website at www.nrplp.com. To
access the replay, please visit the Investor Relations section of
NRP’s website.
Company Profile
Natural Resource Partners L.P., a master limited partnership
headquartered in Houston, TX, is a diversified natural resource
company that owns, manages and leases a diversified portfolio of
properties in the United States including coal, industrial minerals
and other natural resources, as well as rights to conduct carbon
sequestration and renewable energy activities. NRP also owns an
equity investment in Sisecam Wyoming LLC, one of the world’s
lowest-cost producers of soda ash.
For additional information, please contact Tiffany Sammis at
713-751-7515 or tsammis@nrplp.com. Further information about NRP is
available on the Partnership’s website at http://www.nrplp.com.
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, among
other things, statements regarding: the effects of the global
COVID-19 pandemic; future distributions on the Partnership’s common
and preferred units; the Partnership's business strategy; its
liquidity and access to capital and financing sources; its
financial strategy; prices of and demand for coal, trona and soda
ash, and other natural resources; estimated revenues, expenses and
results of operations; projected future performance by the
Partnership's lessees, including Foresight Energy; Ciner Wyoming
LLC’s trona mining and soda ash refinery operations; distributions
from the soda ash joint venture; the impact of governmental
policies, laws and regulations, as well as regulatory and legal
proceedings involving the Partnership, and of scheduled or
potential regulatory or legal changes; global and U.S. economic
conditions; 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.
Non-GAAP Financial Measures
"Adjusted EBITDA" is a non-GAAP financial measure that we
define as net income (loss) less equity earnings from
unconsolidated investment, net income attributable to
non-controlling interest and gain on reserve swap; plus total
distributions from unconsolidated investment, interest expense,
net, debt modification expense, loss on extinguishment of debt,
depreciation, depletion and amortization and asset impairments.
Adjusted EBITDA should not be considered an alternative to, or more
meaningful than, net income or loss, net income or loss
attributable to partners, operating income or loss, cash flows from
operating activities or any other measure of financial performance
presented in accordance with GAAP as measures of operating
performance, liquidity or ability to service debt obligations.
There are significant limitations to using Adjusted EBITDA as a
measure of performance, including the inability to analyze the
effect of certain recurring items that materially affect our net
income, the lack of comparability of results of operations of
different companies and the different methods of calculating
Adjusted EBITDA reported by different companies. In addition,
Adjusted EBITDA presented below is not calculated or presented on
the same basis as Consolidated EBITDA as defined in our partnership
agreement or Consolidated EBITDDA as defined in Opco's debt
agreements. Adjusted EBITDA is a supplemental performance measure
used by our management and by external users of our financial
statements, such as investors, commercial banks, research analysts
and others to assess the financial performance of our assets
without regard to financing methods, capital structure or
historical cost basis.
“Distributable cash flow” or "DCF" is a non-GAAP
financial measure that we define as net cash provided by (used in)
operating activities of continuing operations plus distributions
from unconsolidated investment in excess of cumulative earnings,
proceeds from asset sales and disposals, including sales of
discontinued operations, and return of long-term contract
receivable; less maintenance capital expenditures and distributions
to non-controlling interest. DCF 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. DCF may not be calculated the same for us as for other
companies. In addition, distributable cash flow is not calculated
or presented on the same basis as distributable cash flow as
defined in our partnership agreement, which is used as a metric to
determine whether we are able to increase quarterly distributions
to our common unitholders. Distributable cash flow is a
supplemental liquidity measure used by our management and by
external users of our financial statements, such as investors,
commercial banks, research analysts and others to assess our
ability to make cash distributions and repay debt.
“Free cash flow” or "FCF" is a non-GAAP financial measure
that we define as net cash provided by (used in) operating
activities of continuing operations plus distributions from
unconsolidated investment in excess of cumulative earnings and
return of long-term contract receivable; less maintenance and
expansion capital expenditures, cash flow used in acquisition costs
classified as investing or financing activities and distributions
to non-controlling interest. FCF is calculated before mandatory
debt repayments. Free 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. Free cash flow may not be calculated the same for us as
for other companies. Free cash flow is a supplemental liquidity
measure used by our management and by external users of our
financial statements, such as investors, commercial banks, research
analysts and others to assess our ability to make cash
distributions and repay debt.
"Cash flow cushion" is a non-GAAP financial measure that
we define as free cash flow less one-time beneficial items,
mandatory Opco debt repayments, preferred unit distributions and
redemption of PIK units, common unit distributions and warrant cash
settlements. Cash flow cushion 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. Cash flow cushion is a supplemental liquidity measure
used by our management to assess the Partnership's ability to make
or raise cash distributions to our common and preferred unitholders
and our general partner and repay debt or redeem preferred
units.
"Return on capital employed" or "ROCE" is a non-GAAP
financial measure that we define as net income (loss) operations
plus financing costs (interest expense plus loss on extinguishment
of debt) divided by the sum of equity excluding equity of
discontinued operations, and debt. Return on capital employed
should not be considered an alternative to, or more meaningful
than, net income or loss, net income or loss attributable to
partners, operating income or loss, cash flows from operating
activities or any other measure of financial performance presented
in accordance with GAAP as measures of operating performance,
liquidity or ability to service debt obligations. Return on capital
employed is a supplemental performance measure used by our
management team that measures our profitability and efficiency with
which our capital is employed. The measure provides an indication
of operating performance before the impact of leverage in the
capital structure.
-Financial Tables and Reconciliation of
Non-GAAP Measures Follow-
Natural Resource Partners
L.P.
Financial Tables
(Unaudited)
Consolidated Statements of
Comprehensive Income (Loss)
For the Three Months
Ended
For the Year Ended
December 31,
September 30,
December 31,
(In thousands, except per unit
data)
2021
2020
2021
2021
2020
Revenues and other income
Royalty and other mineral rights
$
70,774
$
31,327
$
47,884
$
185,196
$
120,166
Transportation and processing services
2,507
2,194
2,171
9,052
8,845
Equity in earnings of Sisecam Wyoming
10,625
5,528
6,672
21,871
10,728
Gain on asset sales and disposals
2
116
68
245
581
Total revenues and other income
$
83,908
$
39,165
$
56,795
$
216,364
$
140,320
Operating expenses
Operating and maintenance expenses
$
7,973
$
5,595
$
8,354
$
27,049
$
24,795
Depreciation, depletion and
amortization
3,930
3,013
5,182
19,075
9,198
General and administrative expenses
5,810
3,125
4,052
17,360
14,293
Asset impairments
986
2,668
57
5,102
135,885
Total operating expenses
$
18,699
$
14,401
$
17,645
$
68,586
$
184,171
Income (loss) from operations
$
65,209
$
24,764
$
39,150
$
147,778
$
(43,851
)
Interest expense, net
$
(9,568
)
$
(10,077
)
$
(9,652
)
$
(38,876
)
$
(40,968
)
Net income (loss)
$
55,641
$
14,687
$
29,498
$
108,902
$
(84,819
)
Less: income attributable to preferred
unitholders
(8,079
)
(7,612
)
(7,961
)
(31,609
)
(30,225
)
Net income (loss) attributable to common
unitholders and the
general partner
$
47,562
$
7,075
$
21,537
$
77,293
$
(115,044
)
Net income (loss) attributable to common
unitholders
$
46,611
$
6,934
$
21,106
$
75,747
$
(112,743
)
Net income (loss) attributable to the
general partner
951
141
431
1,546
(2,301
)
Net income (loss) per common unit
Basic
$
3.77
$
0.57
$
1.71
$
6.14
$
(9.20
)
Diluted
2.42
0.56
1.10
4.81
(9.20
)
Net income (loss)
$
55,641
$
14,687
$
29,498
$
108,902
$
(84,819
)
Comprehensive income (loss) from
unconsolidated
investment and other
(4,580
)
152
4,204
2,889
2,916
Comprehensive income (loss)
$
51,061
$
14,839
$
33,702
$
111,791
$
(81,903
)
Natural Resource Partners
L.P.
Financial Tables
(Unaudited)
Consolidated Statements of
Cash Flows
For the Three Months
Ended
For the Year Ended
December 31,
September 30,
December 31,
(In thousands)
2021
2020
2021
2021
2020
Cash flows from operating activities
Net income (loss)
$
55,641
$
14,687
$
29,498
$
108,902
$
(84,819
)
Adjustments to reconcile net income (loss)
to net cash
provided by operating activities of
continuing operations:
Depreciation, depletion and
amortization
3,930
3,013
5,182
19,075
9,198
Distributions from unconsolidated
investment
7,350
—
—
11,270
14,210
Equity earnings from unconsolidated
investment
(10,625
)
(5,528
)
(6,672
)
(21,871
)
(10,728
)
Gain on asset sales and disposals
(2
)
(116
)
(68
)
(245
)
(581
)
Asset impairments
986
2,668
57
5,102
135,885
Bad debt expense
857
86
2,069
2,572
4,001
Unit-based compensation expense
1,202
1,004
1,118
4,039
3,570
Amortization of debt issuance costs and
other
366
832
653
2,265
1,323
Change in operating assets and
liabilities:
Accounts receivable
(2,083
)
4,859
(9,163
)
(14,415
)
12,853
Accounts payable
481
14
182
570
207
Accrued liabilities
3,859
780
357
3,020
(2,205
)
Accrued interest
(7,472
)
(7,559
)
7,262
(501
)
(602
)
Deferred revenue
2,428
(461
)
(2,652
)
307
9,733
Other items, net
(1,757
)
(1,124
)
2,236
1,714
(4,477
)
Net cash provided by operating activities
of
continuing operations
$
55,161
$
13,155
$
30,059
$
121,804
$
87,568
Net cash provided by operating activities
of
discontinued operations
—
—
—
—
1,706
Net cash provided by operating
activities
$
55,161
$
13,155
$
30,059
$
121,804
$
89,274
Cash flows from investing activities
Proceeds from asset sales and
disposals
$
—
$
116
$
74
$
249
$
623
Return of long-term contract
receivable
541
660
540
2,163
2,122
Acquisition of non-controlling interest in
BRP
—
—
—
—
(1,000
)
Net cash provided by investing activities
of continuing operations
$
541
$
776
$
614
$
2,412
$
1,745
Net cash provided by (used in) investing
activities of discontinued operations
—
1
—
—
(65
)
Net cash provided by investing
activities
$
541
$
777
$
614
$
2,412
$
1,680
Cash flows from financing activities
Debt repayments
$
(20,335
)
$
(20,335
)
$
—
$
(39,396
)
$
(46,176
)
Distributions to common unitholders and
the general partner
(5,672
)
(5,630
)
(5,671
)
(22,645
)
(16,890
)
Distributions to preferred unitholders
(3,980
)
(3,750
)
(3,921
)
(15,571
)
(26,363
)
Warrant settlement
(9,183
)
—
—
(9,183
)
—
Contributions from discontinued
operations
—
1
—
—
1,641
Acquisition of non-controlling interest in
BRP
—
—
—
(1,000
)
—
Other items
(1
)
—
—
(691
)
—
Net cash used in financing activities of
continuing operations
$
(39,171
)
$
(29,714
)
$
(9,592
)
$
(88,486
)
$
(87,788
)
Net cash used in financing activities of
discontinued operations
—
(1
)
—
—
(1,641
)
Net cash used in financing activities
$
(39,171
)
$
(29,715
)
$
(9,592
)
$
(88,486
)
$
(89,429
)
Net increase (decrease) in cash and cash
equivalents
$
16,531
$
(15,783
)
$
21,081
$
35,730
$
1,525
Cash and cash equivalents at beginning of
period
118,989
115,573
97,908
99,790
98,265
Cash and cash equivalents at end of
period
$
135,520
$
99,790
$
118,989
$
135,520
$
99,790
Supplemental cash flow information:
Cash paid for interest
$
16,549
$
17,118
$
1,898
$
37,378
$
39,830
Non-cash investing and financing
activities:
Plant, equipment, mineral rights and other
funded with
accounts payable or accrued
liabilities
$
—
$
23
$
—
$
—
$
970
Preferred unit distributions
paid-in-kind
3,980
3,750
3,921
15,571
3,750
Natural Resource Partners
L.P.
Financial Tables
Consolidated Balance
Sheets
December 31,
(In thousands,
except unit data)
2021
2020
(Unaudited)
ASSETS
Current assets
Cash and cash equivalents
$
135,520
$
99,790
Accounts receivable, net
24,538
12,322
Other current assets, net
2,723
5,080
Total current assets
$
162,781
$
117,192
Land
24,008
24,008
Mineral rights, net
437,697
460,373
Intangible assets, net
16,130
17,459
Equity in unconsolidated investment
276,004
262,514
Long-term contract receivable, net
31,371
33,264
Other long-term assets, net
5,832
7,067
Total assets
$
953,823
$
921,877
LIABILITIES AND CAPITAL
Current liabilities
Accounts payable
$
1,956
$
1,385
Accrued liabilities
10,297
7,733
Accrued interest
1,213
1,714
Current portion of deferred revenue
11,817
11,485
Current portion of long-term debt, net
39,102
39,055
Total current liabilities
$
64,385
$
61,372
Deferred revenue
50,045
50,069
Long-term debt, net
394,443
432,444
Other non-current liabilities
5,018
5,131
Total liabilities
$
513,891
$
549,016
Commitments and contingencies
Class A Convertible Preferred Units
(269,321 and 253,750 units issued and outstanding at
December 31, 2021 and 2020, respectively,
at $1,000 par value per unit; liquidation
preference of $1,850 per unit and $1,700
per unit at December 31, 2021 and 2020,
respectively)
$
183,908
$
168,337
Partners’ capital:
Common unitholders’ interest (12,351,306
and 12,261,199 units issued and outstanding
at December 30, 2021 and 2020,
respectively)
$
203,062
$
136,927
General partner’s interest
1,787
459
Warrant holders' interest
47,964
66,816
Accumulated other comprehensive income
3,211
322
Total partners’ capital
$
256,024
$
204,524
Total liabilities and capital
$
953,823
$
921,877
Natural Resource Partners
L.P.
Financial Tables
(Unaudited)
Consolidated Statements of
Partners' Capital
Common Unitholders
General
Partner
Warrant
Holders
Accumulated
Other
Comprehensive
Income (Loss)
Partners' Capital
Excluding
Non-
Controlling Interest
Non-Controlling
Interest
Total
Capital
(In
thousands)
Units
Amounts
Balance at December 31, 2019
12,261
$
271,471
$
3,270
$
66,816
$
(2,594
)
$
338,963
$
(2,935
)
$
336,028
Cumulative effect of adoption of
accounting standard
—
(3,833
)
(78
)
—
—
(3,911
)
$
—
(3,911
)
Net loss (1)
—
(83,123
)
(1,696
)
—
—
(84,819
)
—
(84,819
)
Distributions to common
unitholders and the general
partner
—
(16,552
)
(338
)
—
—
(16,890
)
—
(16,890
)
Distributions to preferred
unitholders
—
(29,511
)
(602
)
—
—
(30,113
)
—
(30,113
)
Acquisition of non-controlling
interest in BRP
—
(4,747
)
(97
)
—
—
(4,844
)
2,935
(1,909
)
Unit-based awards amortization and
vesting
—
3,222
—
—
—
3,222
—
3,222
Comprehensive income from
unconsolidated investment and
other
—
—
—
—
2,916
2,916
—
2,916
Balance at December 31, 2020
12,261
$
136,927
$
459
$
66,816
$
322
$
204,524
$
—
$
204,524
Net income (2)
—
106,724
2,178
—
—
108,902
—
108,902
Distributions to common unitholders and
the general partner
—
(22,192
)
(453
)
—
—
(22,645
)
—
(22,645
)
Distributions to preferred unitholders
—
(30,519
)
(623
)
—
—
(31,142
)
—
(31,142
)
Issuance of unit-based awards
90
—
—
—
—
—
—
—
Unit-based awards amortization and
vesting
—
2,647
—
—
—
2,647
—
2,647
Capital contribution
—
—
32
—
—
32
—
32
Warrant settlement
—
9,475
194
(18,852
)
—
(9,183
)
—
(9,183
)
Comprehensive income from
unconsolidated investment and
other
—
—
—
—
2,889
2,889
—
2,889
Balance at December 31, 2021
12,351
$
203,062
$
1,787
$
47,964
$
3,211
$
256,024
$
—
$
256,024
(1) Net loss includes $30.2 million of
income attributable to preferred unitholders that accumulated
during the period, of which $29.6 million is allocated to the
common unitholders and $0.6 million is allocated to the general
partner.
(2) Net income includes $31.6 million of
income attributable to preferred unitholders that accumulated
during the period, of which $31.0 million is allocated to the
common unitholders and $0.6 million is allocated to the general
partner.
Natural Resource Partners L.P.
Financial Tables
(Unaudited)
The following tables present NRP's unaudited business results by
segment for the three months ended December 31, 2021 and 2020 and
September 30, 2021:
Operating Segments
Mineral Rights
Corporate and
Financing
(In
thousands)
Soda Ash
Total
For the Three Months Ended December 31,
2021
Revenues
$
73,281
$
10,625
$
—
$
83,906
Gain on asset sales and disposals
2
—
—
2
Total revenues and other income
$
73,283
$
10,625
$
—
$
83,908
Asset impairments
$
986
$
—
$
—
$
986
Net income (loss)
$
60,432
$
10,587
$
(15,378
)
$
55,641
Adjusted EBITDA (1)
$
65,348
$
7,312
$
(5,810
)
$
66,850
Cash flow provided by (used in) continuing
operations:
Operating activities
$
67,887
$
7,289
$
(20,015
)
$
55,161
Investing activities
$
541
$
—
$
—
$
541
Financing activities
$
—
$
—
$
(39,171
)
$
(39,171
)
Distributable cash flow (1)
$
68,428
$
7,289
$
(20,015
)
$
55,702
Free cash flow (1)
$
68,428
$
7,289
$
(20,015
)
$
55,702
For the Three Months Ended December 31,
2020
Revenues
$
33,521
$
5,528
$
—
$
39,049
Gain on asset sales and disposals
116
—
—
116
Total revenues and other income
$
33,637
$
5,528
$
—
$
39,165
Asset impairments
$
2,668
$
—
$
—
$
2,668
Net income (loss)
$
22,382
$
5,484
$
(13,179
)
$
14,687
Adjusted EBITDA (1)
$
28,086
$
(44
)
$
(3,125
)
$
24,917
Cash flow provided by (used in) continuing
operations:
Operating activities
$
33,655
$
(54
)
$
(20,446
)
$
13,155
Investing activities
$
776
$
—
$
—
$
776
Financing activities
$
—
$
—
$
(29,714
)
$
(29,714
)
Distributable cash flow (1) (2)
$
34,431
$
(54
)
$
(20,446
)
$
13,932
Free cash flow (1)
$
34,315
$
(54
)
$
(20,446
)
$
13,815
For the Three Months Ended September 30,
2021
Revenues
$
50,055
$
6,672
$
—
$
56,727
Gain on asset sales and disposals
68
—
—
68
Total revenues and other income
$
50,123
$
6,672
$
—
$
56,795
Asset impairments
$
57
$
—
$
—
$
57
Net income (loss)
$
36,606
$
6,596
$
(13,704
)
$
29,498
Adjusted EBITDA (1)
$
41,845
$
(76
)
$
(4,052
)
$
37,717
Cash flow provided by (used in) continuing
operations:
Operating activities
$
33,968
$
(36
)
$
(3,873
)
$
30,059
Investing activities
$
614
$
—
$
—
$
614
Financing activities
$
—
$
—
$
(9,592
)
$
(9,592
)
Distributable cash flow (1)
$
34,582
$
(36
)
$
(3,873
)
$
30,673
Free cash flow (1)
$
34,508
$
(36
)
$
(3,873
)
$
30,599
(1) See "Non-GAAP Financial Measures" and
reconciliation tables at the end of this release.
(2) Includes net proceeds from the sale of
the construction aggregates business which are classified as
investing cash flow from discontinued operations.
Natural Resource Partners L.P.
Financial Tables
(Unaudited)
The following table presents NRP's unaudited business results by
segment for the year ended December 31, 2021 and 2020:
Operating Segments
Mineral Rights
Corporate and
Financing
(In
thousands)
Soda Ash
Total
For the Year Ended December 31, 2021
Revenues
$
194,248
$
21,871
$
—
$
216,119
Gain on asset sales and disposals
245
—
—
245
Total revenues and other income
$
194,493
$
21,871
$
—
$
216,364
Asset impairments
$
5,102
$
—
$
—
$
5,102
Net income (loss)
$
143,412
$
21,702
$
(56,212
)
$
108,902
Adjusted EBITDA (1)
$
167,613
$
11,101
$
(17,360
)
$
161,354
Cash flow provided by (used in) continuing
operations:
Operating activities
$
159,845
$
11,106
$
(49,147
)
$
121,804
Investing activities
$
2,412
$
—
$
—
$
2,412
Financing activities
$
(1,132
)
$
—
$
(87,354
)
$
(88,486
)
Distributable cash flow (1)
$
162,257
$
11,106
$
(49,147
)
$
124,216
Free cash flow (1)
$
161,008
$
11,106
$
(49,147
)
$
122,967
For the Year Ended December 31, 2020
Revenues
$
129,011
$
10,728
$
—
$
139,739
Gain on asset sales and disposals
581
—
—
581
Total revenues and other income
$
129,592
$
10,728
$
—
$
140,320
Asset impairments
$
135,885
$
—
$
—
$
135,885
Net income (loss)
$
(40,180
)
$
10,543
$
(55,182
)
$
(84,819
)
Adjusted EBITDA (1)
$
104,982
$
14,025
$
(14,293
)
$
104,714
Cash flow provided by (used in) continuing
operations:
Operating activities
$
124,737
$
14,037
$
(51,206
)
$
87,568
Investing activities
$
1,745
$
—
$
—
$
1,745
Financing activities
$
—
$
—
$
(87,788
)
$
(87,788
)
Distributable cash flow (1) (2)
$
127,482
$
14,037
$
(51,206
)
$
90,248
Free cash flow (1)
$
125,859
$
14,037
$
(51,206
)
$
88,690
(1) See "Non-GAAP Financial Measures" and reconciliation tables
at the end of this release.
(2) Includes net proceeds from the sale of the construction
aggregates business which are classified as investing cash flow
from discontinued operations.
Natural Resource Partners
L.P.
Financial Tables
(Unaudited)
Operating Statistics - Mineral
Rights
For the Three Months
Ended
For the Year Ended
December 31,
September 30,
December 31,
(In thousands,
except per ton data)
2021
2020
2021
2021
2020
Coal sales volumes (tons)
Appalachia
Northern
388
131
422
1,335
647
Central
3,455
2,468
3,199
12,279
10,111
Southern
513
69
642
1,571
889
Total Appalachia
4,356
2,668
4,263
15,185
11,647
Illinois Basin
1,401
1,540
2,689
9,388
3,381
Northern Powder River Basin
860
506
1,047
3,151
1,738
Gulf Coast
42
—
13
55
—
Total coal sales volumes
6,659
4,714
8,012
27,779
16,766
Coal royalty revenue per ton
Appalachia
Northern
$
8.81
$
2.92
$
7.18
$
6.51
$
2.36
Central
7.77
3.84
5.74
5.71
4.17
Southern
7.73
5.28
11.61
9.14
4.75
Illinois Basin
2.05
2.21
2.33
2.12
2.36
Northern Powder River Basin
3.41
3.11
3.71
3.54
3.50
Gulf Coast
0.62
—
0.54
0.60
—
Combined average coal royalty revenue per
ton
6.01
3.23
4.87
4.47
3.70
Coal royalty revenues
Appalachia
Northern
$
3,419
$
383
$
3,031
$
8,691
$
1,526
Central
26,841
9,481
18,357
70,149
42,207
Southern
3,965
364
7,452
14,355
4,221
Total Appalachia
34,225
10,228
28,840
93,195
47,954
Illinois Basin
2,873
3,403
6,261
19,917
7,973
Northern Powder River Basin
2,929
1,576
3,881
11,151
6,086
Gulf Coast
26
—
7
33
—
Unadjusted coal royalty revenues
40,053
15,207
38,989
124,296
62,013
Coal royalty adjustment for minimum
leases
(2,059
)
(3,898
)
(6,557
)
(20,207
)
(10,145
)
Total coal royalty revenues
$
37,994
$
11,309
$
32,432
$
104,089
$
51,868
Other revenues
Production lease minimum revenues
$
4,028
$
8,195
$
3,235
$
14,269
$
21,749
Minimum lease straight-line revenues
4,791
4,447
4,808
20,564
16,796
Forest CO2 sequestration revenues
13,790
—
—
13,790
—
Wheelage revenues
4,476
1,557
1,964
10,065
7,025
Property tax revenues
1,506
1,530
1,466
6,028
5,786
Coal overriding royalty revenues
775
1,658
757
4,367
4,977
Lease amendment revenues
1,537
859
1,519
4,696
3,450
Aggregates royalty revenues
550
649
429
1,889
1,717
Oil and gas royalty revenues
1,086
893
1,154
4,506
5,816
Other revenues
241
230
120
933
982
Total other revenues
$
32,780
$
20,018
$
15,452
$
81,107
$
68,298
Royalty and other mineral rights
$
70,774
$
31,327
$
47,884
$
185,196
$
120,166
Transportation and processing services
revenues
2,507
2,194
2,171
9,052
8,845
Gain on asset sales and disposals
2
116
68
245
581
Total Mineral Rights segment revenues and
other income
$
73,283
$
33,637
$
50,123
$
194,493
$
129,592
Natural Resource Partners
L.P.
Reconciliation of Non-GAAP
Measures
(Unaudited)
Adjusted EBITDA
Mineral Rights
Corporate and
Financing
(In
thousands)
Soda Ash
Total
For the Three Months Ended December 31,
2021
Net income (loss)
$
60,432
$
10,587
$
(15,378
)
$
55,641
Less: equity earnings from unconsolidated
investment
—
(10,625
)
—
(10,625
)
Add: total distributions from
unconsolidated investment
—
7,350
—
7,350
Add: interest expense, net
—
—
9,568
9,568
Add: depreciation, depletion and
amortization
3,930
—
—
3,930
Add: asset impairments
986
—
—
986
Adjusted EBITDA
$
65,348
$
7,312
$
(5,810
)
$
66,850
For the Three Months Ended December 31,
2020
Net income (loss)
$
22,382
$
5,484
$
(13,179
)
$
14,687
Less: equity earnings from unconsolidated
investment
—
(5,528
)
—
(5,528
)
Add: total distributions from
unconsolidated investment
—
—
—
—
Add: interest expense, net
23
—
10,054
10,077
Add: depreciation, depletion and
amortization
3,013
—
—
3,013
Add: asset impairments
2,668
—
—
2,668
Adjusted EBITDA
$
28,086
$
(44
)
$
(3,125
)
$
24,917
For the Three Months Ended September
30, 2021
Net income (loss)
$
36,606
$
6,596
(13,704
)
$
29,498
Less: equity earnings from unconsolidated
investment
—
(6,672
)
—
(6,672
)
Add: total distributions from
unconsolidated investment
—
—
—
—
Add: interest expense, net
—
—
9,652
9,652
Add: depreciation, depletion and
amortization
5,182
—
—
5,182
Add: asset impairments
57
—
—
57
Adjusted EBITDA
$
41,845
$
(76
)
$
(4,052
)
$
37,717
Natural Resource Partners
L.P.
Reconciliation of Non-GAAP
Measures
(Unaudited)
Adjusted EBITDA
Mineral Rights
Corporate and
Financing
(In
thousands)
Soda Ash
Total
For the Year Ended December 31,
2021
Net income (loss)
$
143,412
$
21,702
$
(56,212
)
$
108,902
Less: equity earnings from unconsolidated
investment
—
(21,871
)
—
(21,871
)
Add: total distributions from
unconsolidated investment
—
11,270
—
11,270
Add: interest expense, net
24
—
38,852
38,876
Add: depreciation, depletion and
amortization
19,075
—
—
19,075
Add: asset impairments
5,102
—
—
5,102
Adjusted EBITDA
$
167,613
$
11,101
$
(17,360
)
$
161,354
For the Year Ended December 31,
2020
Net income (loss)
$
(40,180
)
$
10,543
$
(55,182
)
$
(84,819
)
Less: equity earnings from unconsolidated
investment
—
(10,728
)
—
(10,728
)
Add: total distributions from
unconsolidated investment
—
14,210
—
14,210
Add: interest expense, net
79
—
40,889
40,968
Add: depreciation, depletion and
amortization
9,198
—
—
9,198
Add: asset impairments
135,885
—
—
135,885
Adjusted EBITDA
$
104,982
$
14,025
$
(14,293
)
$
104,714
Natural Resource Partners
L.P.
Reconciliation of Non-GAAP
Measures
(Unaudited)
Distributable Cash Flow and
Free Cash Flow
Mineral Rights
Corporate and
Financing
(In
thousands)
Soda Ash
Total
For the Three Months Ended December 31,
2021
Net cash provided by (used in) operating
activities of continuing
operations
$
67,887
$
7,289
$
(20,015
)
$
55,161
Add: proceeds from asset sales and
disposals
—
—
—
—
Add: return of long-term contract
receivable
541
—
—
541
Distributable cash flow
$
68,428
$
7,289
$
(20,015
)
$
55,702
Less: proceeds from asset sales and
disposals
—
—
—
—
Less: proceeds from sale of discontinued
operations
—
—
—
—
Less: acquisition costs
—
—
—
—
Free cash flow
$
68,428
$
7,289
$
(20,015
)
$
55,702
Net cash provided by investing
activities
$
541
$
—
$
—
$
541
Net cash used in financing activities
—
—
(39,171
)
(39,171
)
For the Three Months Ended December 31,
2020
Net cash provided by (used in) operating
activities of continuing
operations
$
33,655
$
(54
)
$
(20,446
)
$
13,155
Add: proceeds from asset sales and
disposals
116
—
—
116
Add: proceeds from sale of discontinued
operations
—
—
—
1
Add: return of long-term contract
receivable
660
—
—
660
Distributable cash flow
$
34,431
$
(54
)
$
(20,446
)
$
13,932
Less: proceeds from asset sales and
disposals
(116
)
—
—
(116
)
Less: proceeds from sale of discontinued
operations
—
—
—
(1
)
Less: acquisition costs
—
—
—
—
Free cash flow
$
34,315
$
(54
)
$
(20,446
)
$
13,815
Net cash provided by investing
activities
$
776
$
—
$
—
$
776
Net cash used in financing activities
—
—
(29,714
)
(29,714
)
For the Three Months Ended September
30, 2021
Net cash provided by (used in) operating
activities of continuing
operations
$
33,968
$
(36
)
$
(3,873
)
$
30,059
Add: proceeds from asset sales and
disposals
74
—
—
74
Add: return of long-term contract
receivable
540
—
—
540
Distributable cash flow
$
34,582
$
(36
)
$
(3,873
)
$
30,673
Less: proceeds from asset sales and
disposals
(74
)
—
—
(74
)
Less: proceeds from sale of discontinued
operations
—
—
—
—
Less: acquisition costs
—
—
—
—
Free cash flow
$
34,508
$
(36
)
$
(3,873
)
$
30,599
Net cash provided by investing
activities
$
614
$
—
$
—
$
614
Net cash used in financing activities
—
—
(9,592
)
(9,592
)
Natural Resource Partners
L.P.
Reconciliation of Non-GAAP
Measures
(Unaudited)
Distributable Cash Flow and
Free Cash Flow
Mineral Rights
Corporate and
Financing
(In
thousands)
Soda Ash
Total
For the Year Ended December 31,
2021
Net cash provided by (used in) operating
activities of continuing
operations
$
159,845
$
11,106
$
(49,147
)
$
121,804
Add: proceeds from asset sales and
disposals
249
—
—
249
Add: proceeds from sale of discontinued
operations
—
—
—
—
Add: return of long-term contract
receivable
2,163
—
—
2,163
Distributable cash flow
$
162,257
$
11,106
$
(49,147
)
$
124,216
Less: proceeds from asset sales and
disposals
(249
)
—
—
(249
)
Less: proceeds from sale of discontinued
operations
—
—
—
—
Less: acquisition costs
(1,000
)
—
—
(1,000
)
Free cash flow
$
161,008
$
11,106
$
(49,147
)
$
122,967
Net cash provided by investing
activities
$
2,412
$
—
$
—
$
2,412
Net cash used in financing activities
(1,132
)
—
(87,354
)
(88,486
)
For the Year Ended December 31,
2020
Net cash provided by (used in) operating
activities of continuing
operations
$
124,737
$
14,037
$
(51,206
)
$
87,568
Add: proceeds from asset sales and
disposals
623
—
—
623
Add: proceeds from sale of discontinued
operations
—
—
—
(65
)
Add: return of long-term contract
receivable
2,122
—
—
2,122
Distributable cash flow
$
127,482
$
14,037
$
(51,206
)
$
90,248
Less: proceeds from asset sales and
disposals
(623
)
—
—
(623
)
Less: proceeds from sale of discontinued
operations
—
—
—
65
Less: acquisition costs
(1,000
)
—
—
(1,000
)
Free cash flow
$
125,859
$
14,037
$
(51,206
)
$
88,690
Net cash provided by investing
activities
$
1,745
$
—
$
—
$
1,745
Net cash used in financing activities
—
—
(87,788
)
(87,788
)
Cash Flow Cushion
For the Year Ended December
31,
(In
thousands)
2021
2020
Free cash flow
$
122,967
$
88,690
Less: mandatory Opco debt repayments
(39,396
)
(46,176
)
Less: preferred unit distributions
(15,571
)
(26,363
)
Less: common unit distributions
(22,645
)
(16,890
)
Less: warrant cash settlement
(9,183
)
—
Cash flow cushion
$
36,172
$
(739
)
Natural Resource Partners
L.P.
Reconciliation of Non-GAAP
Measures
(Unaudited)
Leverage Ratio
(In
thousands)
For the Year Ended December
31, 2021
Adjusted EBITDA
$
161,354
Debt—at December 31, 2021
$
438,484
Leverage Ratio (1)
2.7 x
(1) Leverage Ratio is calculated as the outstanding principal of
NRP's debt as of December 31, 2021 divided by the last twelve
months' Adjusted EBITDA. Note that Adjusted EBITDA under the
indenture governing NRP's 2025 parent company notes may be
different than the amount shown above. However, NRP's last twelve
months Leverage ratio as of December 31, 2021, was 2.7x as
calculated under the indenture governing NRP's 2025 parent company
notes.
Return on Capital Employed
("ROCE")
Mineral Rights
Corporate and
Financing
(In
thousands)
Soda Ash
Total
LTM Ended December 31, 2021
Net income (loss)
$
143,412
$
21,702
$
(56,212
)
$
108,902
Financing costs
30
—
38,908
38,938
Return
$
143,442
$
21,702
$
(17,304
)
$
147,840
As of December 31, 2020
Total assets
$
656,505
$
262,514
$
2,858
$
921,877
Less: total current liabilities excluding
current debt, net
(17,957
)
(12
)
(4,348
)
(22,317
)
Less: total long-term liabilities
excluding long-term debt, net
(54,640
)
—
(560
)
(55,200
)
Capital employed
$
583,908
$
262,502
$
(2,050
)
$
844,360
Total partners' capital
$
583,908
$
262,502
$
(641,886
)
$
204,524
Class A convertible preferred units
—
—
168,337
168,337
Debt, net
—
—
471,499
471,499
Capital employed
$
583,908
$
262,502
$
(2,050
)
$
844,360
ROCE
24.6
%
8.3
%
N/A
17.5
%
Excluding asset impairments:
Return
$
143,442
$
21,702
$
(17,304
)
$
147,840
Add: asset impairments
5,102
—
—
5,102
Return excluding asset impairments
$
148,544
$
21,702
$
(17,304
)
$
152,942
ROCE excluding asset impairments
25.4
%
8.3
%
N/A
18.1
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220315005180/en/
Tiffany Sammis, 713-751-7515 tsammis@nrplp.com.
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