Green Plains Partners Reports Third Quarter 2020 Financial Results
11/04/2020 - 04:32 PM
Results for the Third Quarter of 2020
Net income of $10.3 million , or $0.44 per common unit Adjusted EBITDA of $13.9 million and distributable cash flow of $11.3 million Quarterly cash distribution of $0.12 per unit Distribution coverage ratio of 3.97x, LTM distribution coverage ratio of 2.28x OMAHA, Neb., Nov. 04, 2020 (GLOBE NEWSWIRE) -- Green Plains Partners LP (NASDAQ:GPP) today announced financial and operating results for the third quarter of 2020. Net income attributable to the partnership was $10.3 million , or $0.44 per common unit, for the third quarter of 2020 compared with net income of $10.1 million , or $0.43 per common unit, for the same period in 2019.
The partnership also reported adjusted EBITDA of $13.9 million and distributable cash flow of $11.3 million for the third quarter of 2020, compared with adjusted EBITDA of $13.3 million and distributable cash flow of $11.1 million for the same period in 2019. Distribution coverage was 3.97x for the three months ended September 30, 2020 as compared to 0.98x for the same period a year ago.
“We continue to generate sufficient cash flow from operations to support our required debt amortization and fund distributions,” said Todd Becker, president and chief executive officer. “We remain committed to delivering value to our unitholders by further deleveraging the balance sheet supported by long-term minimum volume commitments. The partnership is also well positioned to benefit from Green Plains’ ongoing transformation, including its investments to reduce operating costs and the addition of ultra-high protein production technology, which enables more consistent and higher throughput over the long-term.”
Third Quarter Highlights and Recent Developments
On October 15, 2020, the board of directors of the partnership’s general partner declared a quarterly cash distribution of $0.12 per unit, or approximately $2.8 million , for the third quarter of 2020. The distribution is payable on November 13, 2020, to unitholders of record at the close of business on November 6, 2020. Results of Operations $1.2 million for the three months ended September 30, 2020, compared with the same period for 2019. Storage and throughput services revenue increased $0.7 million due to an increase in the rate per gallon charged to Green Plains Trade beginning on July 1, 2020. Railcar transportation services revenue increased $0.5 million primarily due to an increase in average volumetric capacity provided and the average capacity fee charged.
Operations and maintenance expenses increased $0.4 million for the three months ended September 30, 2020, compared with the same period for 2019, primarily due to an increase in railcar lease expense. This increase was due to the acceleration of operating lease expense caused by the early termination of leased railcar assets as well as an increase in the average railcar lease rates. General and administrative expenses increased $0.2 million for the three months ended September 30, 2020, compared with the same period for 2019, primarily due to increased expenses for insurance and property taxes.
During the third quarter of 2020, our parent’s average production utilization rate was approximately 66.8% of capacity. Biofuel throughput was 189.6 million gallons, compared with the contracted minimum volume commitment of 235.7 million gallons per quarter. As a result, the partnership charged Green Plains Trade $2.4 million related to the minimum volume commitment deficiency for the quarter, resulting in a credit to be applied against excess volumes in future periods. The cumulative minimum volume deficiency credits available to Green Plains Trade as of September 30, 2020 totaled $6.7 million . If these credits are unused by Green Plains Trade, $4.3 million will expire on June 30, 2021 and $2.4 million will expire on September 30, 2021. These credits have been recognized in revenue by the partnership, and as such, future volumes throughput by Green Plains Trade in excess of the quarterly minimum volume commitment, up to the amount of these credits, will not be recognized in revenue in future periods prior to expiration.
GREEN PLAINS PARTNERS LP SELECTED OPERATING DATA (unaudited, in million gallons) Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 % Var. 2020 2019 % Var. Product volumes Storage and throughput services 189.6 238.9 (20.6 )% 581.3 619.7 (6.2 )% Terminal services: Affiliate 24.5 31.8 (23.0 ) 79.3 86.4 (8.2 ) Non-affiliate 27.7 26.3 5.3 78.3 79.1 (1.0 ) 52.2 58.1 (10.2 ) 157.6 165.5 (4.8 ) Railcar capacity billed (daily average) 81.5 77.0 5.8 80.4 80.5 (0.1 )
Liquidity and Capital Resources $4.4 million , including $0.1 million in cash and cash equivalents, and $4.3 million available under the partnership’s revolving credit facility.
Conference Call Information http://ir.greenplainspartners.com .
Non-GAAP Financial Measures
About Green Plains Partners LP www.greenplainspartners.com .
About Green Plains Inc. 48.9% limited partner interest and a 2.0% general partner interest in Green Plains Partners LP. For more information about Green Plains, visit www.gpreinc.com .
Forward-Looking Statements
Consolidated Financial Results
GREEN PLAINS PARTNERS LP CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) September 30, December 31, 2020 2019 ASSETS (unaudited) Current assets Cash and cash equivalents $ 75 $ 261 Accounts receivable, including from affiliates 16,772 16,651 Other current assets 1,098 517 Total current assets 17,945 17,429 Property and equipment, net 35,186 37,355 Operating lease right-of-use assets 36,330 35,456 Other assets 14,430 15,413 Total assets $ 103,891 $ 105,653 LIABILITIES AND PARTNERS' DEFICIT Current liabilities Accounts payable, including to affiliates $ 4,895 $ 5,593 Operating lease current liabilities 11,360 13,093 Current maturities of long-term debt 34,035 132,100 Other current liabilities 4,691 5,026 Total current liabilities 54,981 155,812 Long-term debt 81,356 - Operating lease long-term liabilities 26,384 23,088 Asset retirement obligations 2,770 2,500 Total liabilities 165,491 181,400 Partners' deficit (61,600 ) (75,747 ) Total liabilities and partners' deficit $ 103,891 $ 105,653
GREEN PLAINS PARTNERS LP CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited, in thousands except per unit amounts) Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 % Var. 2020 2019 % Var. Revenues Affiliate $ 20,347 $ 18,836 8.0 % $ 58,327 $ 56,751 2.8 % Non-affiliate 1,035 1,318 (21.5 ) 3,707 5,315 (30.3 ) Total revenues 21,382 20,154 6.1 62,034 62,066 (0.1 ) Operating expenses Operations and maintenance (excluding depreciation and amortization reflected below) 6,647 6,216 6.9 19,410 19,314 0.5 General and administrative 1,116 949 17.6 3,038 3,054 (0.5 ) Depreciation and amortization 940 991 (5.1 ) 2,867 2,747 4.4 Total operating expenses 8,703 8,156 6.7 25,315 25,115 0.8 Operating income 12,679 11,998 5.7 36,719 36,951 (0.6 ) Other income (expense) Interest income - 21 * - 61 * Interest expense (2,498 ) (2,103 ) 18.8 (6,182 ) (6,324 ) (2.2 ) Other - 88 * - 15 * Total other expense (2,498 ) (1,994 ) 25.3 (6,182 ) (6,248 ) (1.1 ) Income before income taxes and income from equity method investee 10,181 10,004 1.8 30,537 30,703 (0.5 ) Income tax expense (30 ) (45 ) (33.3 ) (166 ) (144 ) 15.3 Income from equity method investee 155 173 (10.4 ) 488 530 (7.9 ) Net income $ 10,306 $ 10,132 1.7 % $ 30,859 $ 31,089 (0.7 )% Net income attributable to partners' ownership interests: General partner $ 206 $ 203 1.5 % $ 617 $ 621 (0.6 )% Limited partners - common unitholders 10,100 9,929 1.7 30,242 30,468 (0.7 ) Earnings per limited partner unit (basic and diluted): Common units $ 0.44 $ 0.43 2.3 % $ 1.31 $ 1.32 (0.8 )% Weighted average limited partner units outstanding (basic and diluted): Common units 23,161 23,138 23,145 23,125 Supplemental Revenues Data: Storage and throughput services $ 12,520 $ 11,785 6.2 % $ 36,090 $ 35,355 2.1 % Railcar transportation services 5,538 5,005 10.6 16,036 16,129 (0.6 ) Terminal services 2,162 2,193 (1.4 ) 6,488 7,394 (12.3 ) Trucking and other 1,162 1,171 (0.8 ) 3,420 3,188 7.3 Total revenues $ 21,382 $ 20,154 6.1 % $ 62,034 $ 62,066 (0.1 )% * Percentage variance not considered meaningful.
GREEN PLAINS PARTNERS LP CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited, in thousands) Nine Months Ended September 30, 2020 2019 Cash flows from operating activities: Net income $ 30,859 $ 31,089 Noncash operating adjustments: Depreciation and amortization 2,867 2,747 Distribution from equity method investee 1,000 - Other 1,146 464 Net change in working capital (1,595 ) 1,859 Net cash provided by operating activities 34,277 36,159 Cash flows from investing activities: Purchases of property and equipment (117 ) (62 ) Proceeds from the disposal of property and equipment - 136 Net cash provided by (used in) investing activities (117 ) 74 Cash flows from financing activities: Payments of distributions (16,958 ) (33,818 ) Net payments on revolving credit facility (4,400 ) (2,000 ) Net payments on long-term debt (9,500 ) - Payments of loan fees (3,495 ) - Other 7 6 Net cash used in financing activities (34,346 ) (35,812 ) Net change in cash and cash equivalents (186 ) 421 Cash and cash equivalents, beginning of period 261 569 Cash and cash equivalents, end of period $ 75 $ 990
GREEN PLAINS PARTNERS LP RECONCILIATIONS TO NON-GAAP FINANCIAL MEASURES (unaudited, in thousands except ratios) Three Months Ended Nine Months Ended LTM Ended September 30, September 30, September 30, 2020 2019 2020 2019 2020 Net income $ 10,306 $ 10,132 $ 30,859 $ 31,089 $ 41,249 Interest expense 2,498 2,103 6,182 6,324 8,168 Income tax expense 30 45 166 144 242 Depreciation and amortization 940 991 2,867 2,747 3,561 Unit-based compensation expense 81 81 239 239 319 Gain on the disposal of assets - (87 ) - (14 ) - Proportional share of EBITDA adjustments of equity method investee (1) 43 44 137 153 180 Adjusted EBITDA 13,898 13,309 40,450 40,682 53,719 Interest paid or payable (2,498 ) (2,103 ) (6,182 ) (6,324 ) (8,168 ) Income taxes paid or payable (30 ) (45 ) (91 ) (141 ) (188 ) Maintenance capital expenditures (62 ) (62 ) (116 ) (62 ) (148 ) Distributable cash flow (2) $ 11,308 $ 11,099 $ 34,061 $ 34,155 $ 45,215 Distributions declared (3) $ 2,848 $ 11,280 $ 8,520 $ 33,829 $ 19,800 Coverage ratio 3.97x 0.98x 4.00x 1.01x 2.28x (1) Represents the partnership's proportional share of depreciation and amortization of its equity method investee. (2) Distributable cash flow does not include adjustments for the required principal payments on the term loan of $12.5 million for the three and nine months ended September 30, 2020. (3) Represents distributions declared for the applicable period and paid in the subsequent quarter.
Green Plains Inc. Contacts Investors: Phil Boggs | Senior Vice President, Investor Relations & Treasurer | 402.884.8700 | phil.boggs@gpreinc.com Media : Leighton Eusebio | Manager, Public Relations | 402.952.4971 | leighton.eusebio@gpreinc.com
