SAN ANTONIO, March 7, 2014 /PRNewswire/ -- Valero Energy
Partners LP (NYSE: VLP, the Partnership), a growth-oriented, master
limited partnership formed by Valero Energy Corporation, today
reported fourth quarter 2013 net income of $12.1 million. For the period from the initial
public offering (IPO) that closed on December 16, 2013, through December 31, 2013, net income was $2.0 million, or $0.03 per common unit. During this same period,
the Partnership generated earnings before interest, income taxes,
depreciation and amortization (EBITDA) of $2.6 million and distributable cash flow of
$2.6 million.
On December 11, 2013, Valero
Energy Partners' common units began trading on the New York Stock
Exchange under the ticker symbol "VLP." The Partnership completed
its IPO of 17,250,000 common units on December 16, 2013. The public owns a 29.4 percent
limited partner interest in the Partnership, with Valero Energy
Corporation, through certain of its subsidiaries, owning the
remaining limited partner interests and the 2 percent general
partner interest.
For the post-IPO period, transportation and terminaling
throughput revenues were $4.0
million. Total operating expenses were $1.0 million, general and administrative expenses
were $0.4 million, and depreciation
expense was $0.5 million.
At the end of the year, the Partnership had $375 million in cash and cash equivalents,
primarily related to net IPO proceeds, which the Partnership
retained primarily to fund future acquisitions and capital
expenditures. In addition, the Partnership has an undrawn
$300 million revolving credit
facility.
On January 20, 2014, the Board of
Directors of the Partnership's general partner declared a quarterly
cash distribution of $0.037 per unit,
or $2.2 million, which corresponds to
the minimum quarterly distribution of $0.2125 per unit, or $0.85 per unit on an annualized basis. This
distribution was prorated for the period following the closing of
the IPO and was paid on February
12.
Commenting on growth opportunities for the coming year, the
Partnership's CEO, Joe Gorder, said
"Our strategic sponsorship by the world's largest independent
refiner, Valero Energy Corporation, positions us very well to fuel
our growth. We are actively evaluating acquisition opportunities
and seek to deliver top-tier distribution growth to our
unitholders."
Results of operations for the fourth quarter of 2013 include the
results of the Partnership's predecessor through December 15, 2013. Because results presented for
periods prior to the IPO do not factor into distributable cash
flow, this earnings release focuses on results of operations for
the post-IPO period. A reconciliation of the post-IPO period to the
full fourth quarter 2013 results is provided in the tables attached
to this release. Predecessor activity, when combined with
Partnership results, is not necessarily reflective of future
performance.
The Partnership's senior management will host a conference call
at 11 a.m. ET (10 a.m. CT) today to discuss this earnings
release and provide an update on the Partnership's
operations. A live broadcast of the conference call will be
available on the Partnership's web site at
www.valeroenergypartners.com.
About Valero Energy Partners LP
Valero Energy Partners LP is a fee-based, growth-oriented,
traditional master limited partnership formed by Valero Energy
Corporation to own, operate, develop and acquire crude oil and
refined petroleum products pipelines, terminals and other
transportation and logistics assets. With headquarters in
San Antonio, the Partnership's
assets include crude oil and refined petroleum products pipeline
and terminal systems in the Gulf Coast and Mid-Continent regions of
the United States that are
integral to the operations of Valero's refinery located in
Port Arthur, Texas, its McKee
refinery located in Sunray, Texas,
and its refinery located in Memphis,
Tennessee.
Contacts
Investors: John Locke,
210-345-3077
Media: Bill Day, 210-345-2928
Safe-Harbor Statement
This release contains forward-looking statements within the meaning
of federal securities laws. These statements discuss future
expectations, contain projections of results of operations or of
financial condition or state other forward-looking information. You
can identify forward-looking statements by words such as
"anticipate," "believe," "estimate," "expect," "forecast,"
"project," "could," "may," "should," "would," "will" or other
similar expressions that convey the uncertainty of future events or
outcomes. These forward-looking statements are not guarantees of
future performance and are subject to risks, uncertainties and
other factors, some of which are beyond the Partnership's control
and are difficult to predict. These statements are often based upon
various assumptions, many of which are based, in turn, upon further
assumptions, including examination of historical operating trends
made by the management of the Partnership. Although the Partnership
believes that these assumptions were reasonable when made, because
assumptions are inherently subject to significant uncertainties and
contingencies, which are difficult or impossible to predict and are
beyond its control, the Partnership cannot give assurance that it
will achieve or accomplish these expectations, beliefs or
intentions. When considering these forward-looking
statements, you should keep in mind the risk factors and other
cautionary statements contained in the Partnership's filings with
the U.S. Securities and Exchange Commission, including the Form S-1
and prospectus relating to the initial public offering of the
Partnership's common units and the Partnership's annual report on
Form 10-K for the year ended December 31,
2013. These risks could cause the Partnership's actual
results to differ materially from those contained in any
forward-looking statement.
VALERO ENERGY
PARTNERS LP
EARNINGS
RELEASE
(In Thousands,
Except per Unit Amounts, per Barrel Amounts, and
Ratios)
(Unaudited)
|
|
|
|
|
|
|
Three Months
Ended
December
31,
|
Year
Ended
December
31,
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Statement of
income data (a):
|
|
|
|
|
|
|
Operating
revenues – related party
|
|
|
$24,586
|
|
|
$23,868
|
|
|
$94,529
|
|
|
$86,804
|
Costs and
expenses:
|
|
|
|
|
|
|
|
|
Operating expenses
(b)
|
|
7,890
|
|
5,831
|
|
24,751
|
|
26,249
|
General and administrative
expenses (c)
|
|
1,692
|
|
1,254
|
|
5,478
|
|
5,016
|
Depreciation expense
(d)
|
|
3,403
|
|
2,965
|
|
13,073
|
|
12,881
|
Total
costs and expenses
|
|
12,985
|
|
10,050
|
|
43,302
|
|
44,146
|
Operating
income
|
|
11,601
|
|
13,818
|
|
51,227
|
|
42,658
|
Other income,
net
|
|
198
|
|
184
|
|
309
|
|
337
|
Interest
expense
|
|
(59)
|
|
(65)
|
|
(198)
|
|
(307)
|
Income before income
taxes
|
|
11,740
|
|
13,937
|
|
51,338
|
|
42,688
|
Income tax expense
(benefit) (e)
|
|
(354)
|
|
111
|
|
1,187
|
|
403
|
Net income
|
|
12,094
|
|
|
$13,826
|
|
50,151
|
|
|
$42,285
|
Less:
Net income attributable to Predecessor (a)
|
|
10,053
|
|
|
|
48,110
|
|
|
Net income
attributable to partners
|
|
2,041
|
|
|
|
2,041
|
|
|
Less:
General partner's interest in net income
|
|
41
|
|
|
|
41
|
|
|
Limited partners'
interest in net income
|
|
|
$2,000
|
|
|
|
|
$2,000
|
|
|
|
|
|
|
|
|
|
|
|
Net income per
limited partner unit
(basic and diluted):
|
|
|
|
|
|
|
|
|
Common
units
|
|
|
$0.03
|
|
|
|
|
$0.03
|
|
|
Subordinated
units
|
|
|
$0.03
|
|
|
|
|
$0.03
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
limited partner units
outstanding (basic and diluted):
|
|
|
|
|
|
|
|
|
Common units –
public
|
|
17,250
|
|
|
|
17,250
|
|
|
Common units –
Valero
|
|
11,540
|
|
|
|
11,540
|
|
|
Subordinated units –
Valero
|
|
28,790
|
|
|
|
28,790
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VALERO ENERGY
PARTNERS LP
EARNINGS
RELEASE
(In Thousands,
Except per Unit Amounts, per Barrel Amounts, and
Ratios)
(Unaudited)
|
|
|
|
|
|
|
|
Three Months
Ended
December
31,
|
|
Year
Ended
December
31,
|
|
|
2013
|
|
2012
|
|
2013
|
|
|
2012
|
Operating
highlights:
|
|
|
|
|
|
|
Pipeline
transportation:
|
|
|
|
|
|
|
|
|
Pipeline
transportation revenues
|
|
|
$14,912
|
|
|
$14,800
|
|
|
$57,864
|
|
|
$51,735
|
Pipeline
transportation throughput (BPD) (f)
|
|
601,419
|
|
583,717
|
|
589,970
|
|
520,180
|
Average
pipeline transportation revenue per barrel (g)
|
|
|
$0.27
|
|
|
$0.27
|
|
|
$0.27
|
|
|
$0.27
|
|
|
|
|
|
|
|
|
|
Terminaling:
|
|
|
|
|
|
|
|
|
Terminaling
revenues
|
|
|
$5,957
|
|
|
$4,289
|
|
|
$18,478
|
|
|
$16,650
|
Terminaling
throughput (BPD)
|
|
189,422
|
|
121,596
|
|
144,820
|
|
121,416
|
Average
terminaling revenue per barrel (g)
|
|
|
$0.34
|
|
|
$0.38
|
|
|
$0.35
|
|
|
$0.37
|
|
|
|
|
|
|
|
|
|
Storage revenues
(h)
|
|
|
$3,717
|
|
|
$4,779
|
|
|
$18,187
|
|
|
$18,419
|
|
|
|
|
|
|
|
|
|
Total
operating revenues – related party
|
|
|
$24,586
|
|
|
$23,868
|
|
|
$94,529
|
|
|
$86,804
|
|
|
|
|
|
|
|
|
|
Capital
expenditures:
|
|
|
|
|
|
|
|
|
Maintenance
|
|
|
$4,968
|
|
|
$630
|
|
|
$5,938
|
|
|
$3,914
|
Expansion
|
|
4,702
|
|
2,241
|
|
7,893
|
|
3,736
|
Total capital
expenditures
|
|
9,670
|
|
2,871
|
|
13,831
|
|
7,650
|
Less: Capital
expenditures attributable to Predecessor (a)
|
|
9,670
|
|
2,871
|
|
13,831
|
|
7,650
|
Capital expenditures
attributable to Partnership
|
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
|
|
|
|
|
|
|
Other financial
information:
|
|
|
|
|
|
|
|
|
Quarterly
distribution declared per unit
|
|
|
$0.037
|
|
n/a
|
|
|
$0.037
|
|
n/a
|
EBITDA attributable
to Partnership (i)
|
|
|
$2,603
|
|
n/a
|
|
|
$2,603
|
|
n/a
|
Distributable cash
flow (i)
|
|
|
$2,581
|
|
n/a
|
|
|
$2,581
|
|
n/a
|
Distribution
declared:
|
|
|
|
|
|
|
|
|
Limited
partner units – public
|
|
|
$638
|
|
n/a
|
|
|
$638
|
|
n/a
|
Limited
partner units – Valero
|
|
1,492
|
|
n/a
|
|
1,492
|
|
n/a
|
General
partner units – Valero (j)
|
|
44
|
|
n/a
|
|
44
|
|
n/a
|
Total
distribution declared
|
|
|
$2,174
|
|
n/a
|
|
|
$2,174
|
|
n/a
|
Coverage ratio
(i)
|
|
1.19x
|
|
n/a
|
|
1.19x
|
|
n/a
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31,
|
|
|
|
|
|
|
2013
|
|
|
2012
|
Balance sheet data
(a):
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
|
|
|
|
$375,118
|
|
|
$—
|
Total
assets
|
|
|
|
|
|
656,442
|
|
272,506
|
Total debt
|
|
|
|
|
|
4,127
|
|
6,516
|
Partners'
capital
|
|
|
|
|
|
641,591
|
|
265,369
|
Working
capital
|
|
|
|
|
|
372,230
|
|
(843)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VALERO ENERGY
PARTNERS LP
EARNINGS
RELEASE
(In Thousands,
Except per Unit Amounts, per Barrel Amounts, and
Ratios)
(Unaudited)
|
|
|
|
|
|
|
|
Three Months
Ended
December
31,
|
|
Year
Ended
December
31,
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Reconciliation of
net income to EBITDA and
distributable cash flow (i):
|
|
|
|
|
|
|
Net income
|
|
|
$12,094
|
|
|
$13,826
|
|
|
$50,151
|
|
|
$42,285
|
Plus:
|
|
|
|
|
|
|
|
|
Depreciation
expense
|
|
3,403
|
|
2,965
|
|
13,073
|
|
12,881
|
Interest
expense
|
|
59
|
|
65
|
|
198
|
|
307
|
Income tax expense
(benefit) (e)
|
|
(354)
|
|
111
|
|
1,187
|
|
403
|
EBITDA
|
|
15,202
|
|
16,967
|
|
64,609
|
|
55,876
|
Less:
Predecessor EBITDA prior to IPO
on
December 16, 2013 (a)
|
|
12,599
|
|
16,967
|
|
62,006
|
|
55,876
|
EBITDA attributable
to Partnership
|
|
2,603
|
|
|
$—
|
|
2,603
|
|
|
$—
|
Less: Cash
interest paid
|
|
22
|
|
|
|
22
|
|
|
Distributable cash
flow
|
|
|
$2,581
|
|
|
|
|
$2,581
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
net cash provided by operating
activities to EBITDA and distributable cash flow
(i):
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
|
$12,090
|
|
|
$16,714
|
|
|
$60,687
|
|
|
$54,980
|
Plus:
|
|
|
|
|
|
|
|
|
Change in current
assets and current liabilities
|
|
2,903
|
|
(32)
|
|
2,947
|
|
(250)
|
Amortization of fair
value adjustment to capital lease
Obligations
|
|
90
|
|
109
|
|
417
|
|
436
|
Amortization of debt
issuance costs
|
|
(13)
|
|
—
|
|
(13)
|
|
—
|
Interest
expense
|
|
59
|
|
65
|
|
198
|
|
307
|
Current income tax
expense
|
|
73
|
|
111
|
|
373
|
|
403
|
EBITDA
|
|
15,202
|
|
16,967
|
|
64,609
|
|
55,876
|
Less:
Predecessor EBITDA prior to IPO
on
December 16, 2013 (a)
|
|
12,599
|
|
16,967
|
|
62,006
|
|
55,876
|
EBITDA attributable
to Partnership
|
|
2,603
|
|
|
$—
|
|
2,603
|
|
|
$—
|
Less: Cash
interest paid
|
|
22
|
|
|
|
22
|
|
|
Distributable cash
flow
|
|
|
$2,581
|
|
|
|
|
$2,581
|
|
|
|
|
|
|
|
|
|
|
|
Comparison of
ratio of net income attributable to
partners divided
by total distribution declared
to coverage ratio
(i):
|
|
|
|
|
|
|
|
|
Net income
attributable to partners
|
|
|
$2,041
|
|
n/a
|
|
|
$2,041
|
|
n/a
|
Total distribution
declared
|
|
2,174
|
|
n/a
|
|
2,174
|
|
n/a
|
Ratio of net income
attributable to partners divided by
total distribution
declared
|
|
0.94x
|
|
n/a
|
|
0.94x
|
|
n/a
|
Coverage ratio:
Distributable cash flow divided by
total distribution declared
|
|
1.19x
|
|
n/a
|
|
1.19x
|
|
n/a
|
VALERO ENERGY
PARTNERS LP
EARNINGS
RELEASE
(In Thousands,
Except per Unit Amounts, per Barrel Amounts, and
Ratios)
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
December 31,
2013
|
|
|
Valero Energy
Partners LP Predecessor
Oct 1 - Dec
15
|
|
Valero Energy
Partners LP
Dec 16 - Dec
31
|
|
Total
|
Reconciliation of
Predecessor and Partnership (a):
|
|
|
|
|
Statement of
income data:
|
|
|
|
|
|
|
Operating
revenues – related party
|
|
|
$20,574
|
|
|
$4,012
|
|
|
$24,586
|
Costs and
expenses:
|
|
|
|
|
|
|
Operating
expenses
|
|
6,861
|
|
1,029
|
|
7,890
|
General and
administrative expenses
|
|
1,252
|
|
440
|
|
1,692
|
Depreciation
expense
|
|
2,887
|
|
516
|
|
3,403
|
Total costs and expenses
|
|
11,000
|
|
1,985
|
|
12,985
|
Operating
income
|
|
9,574
|
|
2,027
|
|
11,601
|
Other income,
net
|
|
138
|
|
60
|
|
198
|
Interest
expense
|
|
(23)
|
|
(36)
|
|
(59)
|
Income before
income taxes
|
|
9,689
|
|
2,051
|
|
11,740
|
Income tax
expense (benefit) (e)
|
|
(364)
|
|
10
|
|
(354)
|
Net
income
|
|
|
$10,053
|
|
|
$2,041
|
|
|
$12,094
|
Reconciliation of
net income to EBITDA and
distributable cash flow (i):
|
|
|
|
|
|
|
Net
income
|
|
|
$10,053
|
|
|
$2,041
|
|
|
$12,094
|
Plus:
|
|
|
|
|
|
|
Depreciation expense
|
|
2,887
|
|
516
|
|
3,403
|
Interest expense
|
|
23
|
|
36
|
|
59
|
Income tax expense (benefit) (e)
|
|
(364)
|
|
10
|
|
(354)
|
EBITDA
|
|
12,599
|
|
2,603
|
|
15,202
|
Less: Predecessor EBITDA prior to IPO
on
December 16, 2013 (a)
|
|
12,599
|
|
—
|
|
12,599
|
EBITDA
attributable to Partnership
|
|
|
$—
|
|
2,603
|
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2,603
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Less: Cash interest paid
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22
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22
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Distributable
cash flow
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$2,581
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$2,581
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VALERO ENERGY
PARTNERS LP
NOTES TO EARNINGS
RELEASE
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(a)
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On December 16, 2013,
Valero Energy Corporation (Valero) contributed certain crude oil
and refined petroleum products pipelines, terminals and other
logistics assets (the Contributed Assets) to us and we completed
the initial public offering (IPO) of 17,250,000 of our common units
representing a 29.4 percent limited partner interest in us. Valero
owns the 2 percent general partner interest and the remaining 68.6
percent limited partner interest in us.
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The statement of
income data for the three months and year ended December 31, 2012
and for the period from January 1, 2013 through December 15, 2013
reflect the results of operations of the Contributed Assets, and
the balance sheet data as of December 31, 2012 reflects the assets,
liabilities and net investment associated with the Contributed
Assets. References to this financial data are made with respect to
Valero Energy Partners LP Predecessor (Predecessor), our
predecessor for accounting purposes. The statement of income data
for the period from December 16, 2013 through December 31, 2013
reflect the results of operations of Valero Energy Partners LP
(Partnership, we, our or us), and the balance sheet data as of
December 31, 2013 reflects the assets, liabilities and partners'
capital of the Partnership.
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The Partnership's
future results of operations may not be comparable to the
Predecessor's historical results of operations for the reasons
described below:
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•
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Revenues. Our
Predecessor generated revenues by providing fee-based
transportation and terminaling services to Valero and by leasing
certain crude oil and refined petroleum products storage capacity
to Valero. Subsequent to the IPO, we entered into a master
transportation services agreement and a master terminal services
agreement with Valero with respect to our pipelines and terminals.
Under these commercial agreements, the historical storage capacity
lease arrangements were replaced with terminaling throughput fees.
In addition, we began charging a terminaling throughput fee for
crude oil delivered to our Lucas terminal for which we have not
historically charged a throughput fee.
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•
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General and
administrative expenses. Our Predecessor's general and
administrative expenses include direct charges for the management
and operation of our logistics assets and certain expenses
allocated by Valero for general corporate services, such as
treasury, accounting and legal services. These expenses were
charged, or allocated, to our Predecessor based on the nature of
the expenses. Effective with the IPO, the Partnership pays a fee to
Valero for the management of our operations and general corporate
services. In addition, the Partnership incurs additional
incremental general and administrative expenses as a result of
being a separate publicly traded limited partnership.
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(b)
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The increase in
operating expenses for the three months ended December 31, 2013
compared to the three months ended December 31, 2012 is primarily
due to $1.5 million in higher maintenance expenses at our Lucas and
Collierville crude systems and our West Memphis terminal related to
tank inspection, cleaning and repair work for regulatory compliance
purposes.
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(c)
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The increase in
general and administrative expenses for the three months ended
December 31, 2013 compared to the three months ended December 31,
2012 is due to $222,000 in incremental costs related to the
management fee charged to us by Valero effective with the IPO and
the additional incremental costs of being a separate publicly
traded partnership, and an increase of $216,000 in costs allocated
by Valero in the Predecessor's financial statements, which is
primarily attributable to higher incentive compensation for Valero
employees who provided general corporate services during
2013.
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(d)
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The increase in
depreciation expense for the three months ended December 31, 2013
compared to the three months ended December 31, 2012 is primarily
due to $378,000 for the write-off of the remaining net book value
of miscellaneous equipment that was retired at our Port Arthur
products system.
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(e)
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Our income tax
expense is associated with the Texas margin tax. For the year ended
December 31, 2013, our effective tax rate increased to 2.3%
compared to less than 1% for the year ended December 31, 2012. The
increase was primarily due to deferred tax expense recorded in
connection with the initial recognition of a deferred tax liability
associated with a change in the law with respect to the Texas
margin tax. During the three months ended December 31, 2013, we
made an adjustment to reduce our deferred tax liability resulting
in an income tax benefit for the period. Because this was a
one-time item associated with a law change, we anticipate our
effective tax rate to return to previous levels in future
periods.
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(f)
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Represents the
sum of volumes transported through each separately tariffed
pipeline segment.
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(g)
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Management uses average revenue per barrel to
evaluate performance and compare profitability to other companies
in the industry. There are a variety of ways to calculate average
revenue per barrel; different companies may calculate it in
different ways. We calculate average revenue per barrel as revenue
divided by throughput for the period. Throughput can be derived by
multiplying the throughput barrels per day (BPD) by the number of
days in the period. Investors and analysts use this financial
measure to help analyze and compare companies in the industry on
the basis of operating performance. This financial measure should
not be considered as an alternative to revenues presented in
accordance with U.S. generally accepted accounting principles
(GAAP).
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(h)
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Prior to the IPO, our
Predecessor leased some of our refined petroleum products and crude
oil storage capacity to Valero. Subsequent to the IPO, under our
commercial agreements with Valero, these storage capacity lease
agreements were replaced with terminaling fees.
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(i)
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We define EBITDA as
net income before income tax expense, interest expense and
depreciation expense. We define distributable cash flow as EBITDA
less cash payments during the period for interest, income taxes and
maintenance capital expenditures, plus adjustments related to
minimum throughput commitments and the receipt or amortization of
deferred rental payments. We define coverage ratio as the ratio of
distributable cash flow to the total distribution
declared.
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EBITDA, distributable
cash flow and coverage ratio are supplemental financial measures
that are not defined under GAAP that management and external users
of our financial statements, such as industry analysts, investors,
lenders and rating agencies, may use to assess:
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•
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our operating
performance as compared to other publicly traded limited
partnerships in the transportation and logistics industry, without
regard to historical cost basis or, in the case of EBITDA,
financing methods;
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the ability of our
business to generate sufficient cash to support our decision to
make distributions to our unitholders;
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•
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our ability to incur
and service debt and fund capital expenditures; and
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•
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the viability of
acquisitions and other capital expenditure projects and the returns
on investment of various investment opportunities.
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We believe that the
presentation of EBITDA provides useful information to investors in
assessing our financial condition and results of operations. The
GAAP measures most directly comparable to EBITDA are net income and
net cash provided by operating activities. EBITDA should not be
considered an alternative to net income or net cash provided by
operating activities presented in accordance with GAAP. EBITDA has
important limitations as an analytical tool because it excludes
some, but not all, items that affect net income or net cash
provided by operating activities. EBITDA should not be considered
in isolation or as a substitute for analysis of our results as
reported under GAAP. Additionally, because EBITDA may be defined
differently by other companies in our industry, our definition of
EBITDA may not be comparable to similarly titled measures of other
companies, thereby diminishing its utility.
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We use distributable
cash flow to measure whether we have generated from our operations,
or "earned," an amount of cash sufficient to support the payment of
the minimum quarterly distributions. Our partnership agreement
contains the concept of "operating surplus" to determine whether
our operations are generating sufficient cash to support the
distributions that we are paying, as opposed to returning capital
to our partners. Because operating surplus is a cumulative concept
(measured from the IPO date, and compared to cumulative
distributions from the IPO date), we use the term distributable
cash flow to approximate operating surplus on a quarterly or
annual, rather than a cumulative, basis. As a result, distributable
cash flow is not necessarily indicative of the actual cash we have
on hand to distribute or that we are required to
distribute.
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We use the coverage
ratio to reflect the relationship between our distributable cash
flow and the total distribution declared. We have also provided the
ratio of net income attributable to partners, the most directly
comparable GAAP measure to distributable cash flow, to the total
distribution declared.
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(j)
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Actual distribution
to our general partner was $43,479, which differs from the amount
reflected on the table due to rounding.
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SOURCE Valero Energy Partners LP