Natural Resource Partners L.P.
Reports Third Quarter 2007 Results
Third Quarter Highlights:
| • | | Distributable cash flow of $34.0 million, up 10% over 3Q06 |
| • | | Record revenues of $56.4 million, up 36% |
| • | | Net income attributable to limited partners of $22.9 million, up 7% |
| • | | Net income per unit decreases 17% to $0.35 |
| • | | Distribution increases for seventeenth consecutive quarter to $0.475 per unit |
| • | | Guidance reaffirmed for 2007 |
HOUSTON, November 1, 2007—Natural Resource Partners L.P. (NYSE:NRP and NYSE:NSP)today reported distributable cash flow, a non-GAAP measure, of $34.0 million, up 10% from the $31.0 million reported for the third quarter 2006. Net income attributable to the limited partners increased to $22.9 million for the third quarter of 2007, compared to $21.5 million for the third quarter of 2006. Net income per unit decreased from $0.42 for the third quarter 2006 to $0.35 per unit in the third quarter 2007.
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| | | Highlights | |
| | | 3Q07 | | | 2Q07 | | | 3Q06 | |
| | | (in thousands except per ton and per unit) | |
Coal Production: | | | 14,708 | | | | 13,573 | | | | 12,798 | |
Coal Royalty Revenues: | | $ | 44,378 | | | $ | 40,733 | | | $ | 36,902 | |
Average coal royalty revenue per ton: | | $ | 3.02 | | | $ | 3.00 | | | $ | 2.88 | |
Total revenues: | | $ | 56,366 | | | $ | 51,097 | | | $ | 41,491 | |
Net income to limited partners: | | $ | 22,902 | | | $ | 18,145 | | | $ | 21,483 | |
Average units outstanding in quarter: | | | 64,891 | | | | 64,886 | | | | 50,681 | |
Net income per unit: | | $ | 0.35 | | | $ | 0.28 | | | $ | 0.42 | |
Distributable cash flow: | | $ | 34,045 | | | $ | 43,511 | | | $ | 31,034 | |
“Our third quarter results demonstrated improvement over our second quarter performance, largely due to the strengthening price environment for both metallurgical and steam coal,” said Nick Carter, President and Chief Operating Officer. “We are pleased with the operating performance of our lessees in the third quarter, and as a whole they have met our expectations for the quarter.”
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| NRP Reports 3rd Quarter 2007 Results | | Page 2 of 10 |
“Distributable cash flow for the third quarter was down from second quarter due to changes in working capital and the allocation of $1.9 million to our quarterly debt service reserve in recognition of additional scheduled principal payments on another series of senior notes that will begin amortizing in July 2008,” said Dwight Dunlap, Chief Financial Officer.
Third Quarter and Nine Month Results
Revenues
Third Quarter
Total revenues increased 36% to a record $56.4 million for the third quarter of 2007, compared to $41.5 million reported for the same period last year. Third quarter 2007 coal royalty revenues increased 20% to $44.4 million from $36.9 million last year as the partnership continued to experience increased coal royalty revenues per ton in all regions, with an overall average coal royalty revenue per ton of $3.02. Total production for the partnership in the third quarter was 14.7 million tons compared to 12.8 million tons in 2006. Aggregate royalties, coal processing fees and transportation fees generated approximately $4.5 million in the third quarter of 2007 versus $0.2 million in the same period last year, the first quarter for these operations.
Nine Months
Total revenues improved to $157.7 million, or 22% over the first nine months of 2006, while distributable cash flow increased 11% to $105.9 million over the same period. Coal royalty revenues increased 12% to $126.1 million, largely the result of improved pricing. Average royalty revenue per ton increased to $3.02 from $2.80, or 8%, while NRP’s total production increased approximately 4% to 41.8 million tons over the nine month comparative period. Aggregate royalties, coal processing fees and transportation fees, generated approximately $11.5 million for the first nine months of 2007 versus $0.2 million in the same period last year.
Expenses
Third Quarter
Total expenses increased $8.2 million to $21.1 million in the third quarter. Depreciation, depletion and amortization, a non-cash item, accounted for $6.0 million, or approximately 73% of the increase, primarily as a result of acquisitions over the last year. Property, franchise and other taxes nearly doubled to $4.0 million mainly due to taxes on acquisitions acquired since last year, of which the majority of the property taxes are offset by reimbursements from our lessees, which are recorded in revenues. The remainder is due to additional franchise taxes.
Interest expense increased $3.1 million over the third quarter last year to $7.1 million due to additional borrowings associated with acquisitions completed during the last year.
Nine Months
For the nine month period, total expenses increased $24.1 million to $64.9 million, $15.2 million of which was associated with depreciation, depletion and amortization and $4.1
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| NRP Reports 3rd Quarter 2007 Results | | Page 3 of 10 |
million was associated with property, franchise and other taxes, both due to the same reasons discussed earlier. In addition, general and administrative expenses increased $4.9 million mainly due to increases in personnel, salaries, and incentive compensation accruals; increased costs associated with reporting partners’ tax information; and increases in the allowance for doubtful accounts.
Interest expense for the nine month period increased by $10.3 million due to increased borrowings associated with acquisitions.
Net Income
Third quarter
While total revenues for the third quarter increased by $14.9 million over third quarter 2006, net income attributable to the limited partners only increased $1.4 million to $22.9 million. The increase in revenues was largely offset by increases in expenses primarily due to increases in depreciation, depletion and amortization as well as interest on debt incurred to finance NRP’s recent acquisitions. Net income per unit decreased $0.07 to $0.35 per unit mainly due to approximately 14.2 million additional units that have been issued for acquisitions, some of which are under development and not yet generating significant revenues, since the third quarter 2006.
Nine months
For the nine month period, net income attributable to the limited partners decreased $10.1 million to $58.8 million, or $0.91 per unit for the reasons discussed previously.
Distributable Cash Flow
Third quarter
Distributable cash flow increased $3.0 million, or 10%, over the same quarter last year predominantly due to increases in net income. In the third quarter 2007, NRP reserved $1.9 million for one quarter of the debt payment due in July 2008.
Nine months
For the nine month period distributable cash flow increased $10.4 million, or 11%, predominantly due to increases in deferred revenue and depreciation, depletion and amortization, offset by a decline in net income.
Update on Acquired Properties and Outlook
The Gatling WV property has continued to experience operational issues while ramping up to full production but the mining conditions and operating results are steadily improving.
The Williamson operation in Illinois is currently at full production during the development phase of the longwall. The longwall is expected to be operational sometime in the first quarter of 2008. Coal is currently being shipped and the stockpile is also being reduced, which will generate increased coal royalty revenues and transportation fees for NRP in the fourth quarter. We anticipate those revenue streams will significantly increase in 2008 as longwall production commences.
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| NRP Reports 3rd Quarter 2007 Results | | Page 4 of 10 |
While the properties acquired in the Dingess-Rum acquisition have contributed significantly to NRP’s 2007 coal royalty revenues, the properties continue to substantially underperform expectations as a result of continued geological and operational issues. However, recent mine plan changes at one of the operations should improve production over current levels.
Because NRP’s other lessees are collectively producing and selling coal as forecasted and prices are improving, NRP is reaffirming the guidance issued in August 2007 and anticipates issuing next year’s guidance in January 2008.
Current Market
“This quarter we have seen improvements in prices in all regions over the second quarter of this year. These increases more than offset some modest declines in sales in Northern and Southern Appalachia as some of our lessees have coal ready for export and awaiting ships. We are seeing significantly stronger export markets for both metallurgical coal as well as steam coal, which will bode well for improved pricing going into 2008,” said Nick Carter. “We continue to believe that our concentration in metallurgical coal, with approximately 25% of our reserves and 23% of our current production, could benefit us significantly in the future.”
Distributions
As reported on October 17, the Board of Directors of NRP’s general partner declared a quarterly distribution of $0.475 per unit, an increase of $0.01 per unit, for both the common units traded under the symbol NRP and the subordinated units traded as NSP. This made the seventeenth consecutive increase in the quarterly distribution and represented a 2.2% increase over the second quarter distribution and an 11.8% increase over the third quarter last year.
Capital Structure
Following the payment of the third quarter distribution, all financial conditions precedent to the conversion of the subordinated units into common units required by the partnership agreement, will have been satisfied. After the close of trading on November 14, all outstanding subordinated units will convert, in a tax free conversion, on a one-for-one basis into common units. Following this transaction, the subordinated units will no longer exist and NRP will be the only remaining security that trades on the NYSE for Natural Resource Partners L.P.
Company Profile
Natural Resource Partners L.P. is headquartered in Houston, TX, with its operations headquarters in Huntington, WV. NRP is a master limited partnership that is principally engaged in the business of owning and managing coal properties, and coal handling and
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| NRP Reports 3rd Quarter 2007 Results | | Page 5 of 10 |
transportation infrastructure in the three major coal producing regions of the United States: Appalachia, the Illinois Basin and the Powder River Basin. In addition, the partnership also manages aggregate reserves, oil and gas properties and timber assets across the United States.
For additional information, please contact Kathy Hager at 713-751-7555 orkhager@nrplp.com. Further information about NRP is available on the partnership’s website athttp://www.nrplp.com.
Disclosure of Non-GAAP Financial Measures
Distributable cash flow represents cash flow from operations less actual principal payments and cash reserves set aside for scheduled principal payments on the senior notes. Distributable cash flow is a “non-GAAP financial measure” that is presented because management believes it is a useful adjunct to net cash provided by operating activities under GAAP. Distributable cash flow is a significant liquidity metric that is an indicator of NRP’s ability to generate cash flows at a level that can sustain or support an increase in quarterly cash distributions paid to its partners. Distributable cash flow is also the quantitative standard used throughout the investment community with respect to publicly traded partnerships. Distributable cash flow is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing or financing activities. A reconciliation of distributable cash flow to net cash provided by operating activities is included in the tables attached to this release. Distributable cash flow may not be calculated the same for NRP as other companies.
Forward-Looking Statements
This press release may include “forward-looking statements” as defined by the Securities and Exchange Commission. Such statements include the 2007 outlook and current coal market conditions. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the partnership expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements are based on certain assumptions made by the partnership based on its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the partnership. These risks include, but are not limited to, decreases in demand for coal; changes in operating conditions and costs; production cuts by our lessees; commodity prices; unanticipated geologic problems; changes in the legislative or regulatory environment and other factors detailed in Natural Resource Partners’ Securities and Exchange Commission filings. Natural Resource Partners L.P. has no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
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| 07-22 | | -Financial statements follow- | | |
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| NRP Reports 3rd Quarter 2007 Results | | Page 6 of 10 |
Natural Resource Partners L.P.
Operating Statistics
(In thousands except per ton data)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | For the Nine Months Ended | |
| | | September 30, | | | September 30, | |
| | | 2007 | | | 2006 | | | 2007 | | | 2006 | |
Coal Royalties: | | | | | | | | | | | | | | | | |
| Coal royalty revenues: | | | | | | | | | | | | | | | | |
| Appalachia | | | | | | | | | | | | | | | | |
| Northern | | $ | 3,941 | | | $ | 2,292 | | | $ | 11,064 | | | $ | 8,330 | |
| Central | | | 29,662 | | | | 24,568 | | | | 88,248 | | | | 74,953 | |
| Southern | | | 4,649 | | | | 5,471 | | | | 13,677 | | | | 16,088 | |
| | | | | | | | | | | | | |
| Total Appalachia | | $ | 38,252 | | | $ | 32,331 | | | $ | 112,989 | | | $ | 99,371 | |
| Illinois Basin | | | 2,462 | | | | 808 | | | | 4,941 | | | | 4,465 | |
| Northern Powder River | | | 3,664 | | | | 3,763 | | | | 8,154 | | | | 8,703 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Basin | | | | | | | | | | | | | | | | |
| Total | | $ | 44,378 | | | $ | 36,902 | | | $ | 126,084 | | | $ | 112,539 | |
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| Coal royalty production (tons): | | | | | | | | | | | | | | | | |
| Appalachia | | | | | | | | | | | | | | | | |
| Northern | | | 1,640 | | | | 1,177 | | | | 4,875 | | | | 4,391 | |
| Central | | | 8,927 | | | | 7,873 | | | | 27,022 | | | | 24,050 | |
| Southern | | | 1,184 | | | | 1,395 | | | | 3,514 | | | | 4,256 | |
| | | | | | | | | | | | | |
| Total Appalachia | | | 11,751 | | | | 10,445 | | | | 35,411 | | | | 32,697 | |
| Illinois Basin | | | 1,147 | | | | 368 | | | | 2,307 | | | | 2,507 | |
| Northern Powder River | | | 1,810 | | | | 1,985 | | | | 4,072 | | | | 4,983 | |
| | | | | | | | | | | | | |
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| Basin | | | | | | | | | | | | | | | | |
| Total | | | 14,708 | | | | 12,798 | | | | 41,790 | | | | 40,187 | |
| | | | | | | | | | | | | |
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| Average royalty revenue per ton: | | | | | | | | | | | | | | | | |
| Appalachia | | | | | | | | | | | | | | | | |
| Northern | | $ | 2.40 | | | $ | 1.95 | | | $ | 2.27 | | | $ | 1.90 | |
| Central | | | 3.32 | | | | 3.12 | | | | 3.27 | | | | 3.12 | |
| Southern | | | 3.93 | | | | 3.92 | | | | 3.89 | | | | 3.78 | |
| Total Appalachia | | | 3.26 | | | | 3.10 | | | | 3.19 | | | | 3.04 | |
| Illinois Basin | | | 2.15 | | | | 2.20 | | | | 2.14 | | | | 1.78 | |
| Northern Powder River Basin | | | 2.02 | | | | 1.90 | | | | 2.00 | | | | 1.75 | |
| | | | | | | | | | | | | | | | | |
| Combined average royalty revenue per ton | | $ | 3.02 | | | $ | 2.88 | | | $ | 3.02 | | | $ | 2.80 | |
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Aggregates: | | | | | | | | | | | | | | | | |
| Royalty revenues | | $ | 2,096 | | | | — | | | $ | 5,785 | | | | — | |
| Production: | | | 1,583 | | | | — | | | | 4,455 | | | | — | |
| Average base royalty per ton: | | $ | 1.32 | | | | — | | | $ | 1.30 | | | | — | |
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| NRP Reports 3rd Quarter 2007 Results | | Page 7 of 10 |
Natural Resource Partners L.P.
Consolidated Statements of Income
(In thousands, except per unit data)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | For the Nine Months Ended | |
| | | September 30, | | | September 30, | |
| | | 2007 | | | 2006 | | | 2007 | | | 2006 | |
| | | (Unaudited) | | | (Unaudited) | |
| Revenues: | | | | | | | | | | | | | | | | |
| Coal royalties | | $ | 44,378 | | | $ | 36,902 | | | $ | 126,084 | | | $ | 112,539 | |
| Aggregate royalties | | | 2,096 | | | | — | | | | 5,785 | | | | — | |
| Coal processing fees | | | 1,374 | | | | 203 | | | | 3,404 | | | | 203 | |
| Transportation fees | | | 1,000 | | | | — | | | | 2,306 | | | | — | |
| Oil and gas royalties | | | 1,388 | | | | 853 | | | | 3,924 | | | | 3,500 | |
| Property taxes | | | 2,963 | | | | 1,532 | | | | 7,836 | | | | 4,827 | |
| Minimums recognized as revenue | | | 913 | | | | 633 | | | | 1,698 | | | | 1,254 | |
| Override royalties | | | 953 | | | | 283 | | | | 2,994 | | | | 767 | |
| Other | | | 1,301 | | | | 1,085 | | | | 3,639 | | | | 5,911 | |
| | | | | | | | | | | | | |
| Total revenues | | | 56,366 | | | | 41,491 | | | | 157,670 | | | | 129,001 | |
| Operating costs and expenses: | | | | | | | | | | | | | | | | |
| Depreciation, depletion and amortization | | | 13,045 | | | | 7,009 | | | | 37,324 | | | | 22,098 | |
| General and administrative | | | 3,687 | | | | 3,475 | | | | 15,880 | | | | 11,010 | |
| Property, franchise and other taxes | | | 3,993 | | | | 2,142 | | | | 10,618 | | | | 6,486 | |
| Transportation costs | | | 79 | | | | — | | | | 149 | | | | — | |
| Coal royalty and override payments | | | 246 | | | | 296 | | | | 914 | | | | 1,250 | |
| | | | | | | | | | | | | |
| Total operating costs and expenses | | | 21,050 | | | | 12,922 | | | | 64,885 | | | | 40,844 | |
| | | | | | | | | | | | | |
| Income from operations | | | 35,316 | | | | 28,569 | | | | 92,785 | | | | 88,157 | |
| Other income (expense) | | | | | | | | | | | | | | | | |
| Interest expense | | | (7,124 | ) | | | (3,960 | ) | | | (21,584 | ) | | | (11,253 | ) |
| Interest income | | | 736 | | | | 665 | | | | 2,239 | | | | 1,938 | |
| | | | | | | | | | | | | |
| Net income | | $ | 28,928 | | | $ | 25,274 | | | $ | 73,440 | | | $ | 78,842 | |
| | | | | | | | | | | | | |
Net income attributable to:(1) | | | | | | | | | | | | | | | | |
| General partner | | $ | 4,119 | | | $ | 2,641 | | | $ | 10,012 | | | $ | 6,989 | |
| | | | | | | | | | | | | |
| Holders of incentive distribution rights | | $ | 1,907 | | | $ | 1,150 | | | $ | 4,602 | | | $ | 2,914 | |
| | | | | | | | | | | | | |
| Limited partners | | $ | 22,902 | | | $ | 21,483 | | | $ | 58,826 | | | $ | 68,939 | |
| | | | | | | | | | | | | |
| Basic and diluted net income per limited partner unit: | | | | | | | | | | | | | | | | |
| Common | | $ | 0.35 | | | $ | 0.42 | | | $ | 0.91 | | | $ | 1.36 | |
| | | | | | | | | | | | | |
| Subordinated | | $ | 0.35 | | | $ | 0.42 | | | $ | 0.91 | | | $ | 1.36 | |
| | | | | | | | | | | | | |
| Weighted average number of units outstanding: | | | | | | | | | | | | | | | | |
| Common | | | 53,537 | | | | 33,651 | | | | 53,009 | | | | 33,651 | |
| | | | | | | | | | | | | |
| Subordinated | | | 11,354 | | | | 17,030 | | | | 11,354 | | | | 17,030 | |
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| (1) | | Net income is allocated among the limited partners, the general partner and holders of the incentive distribution rights (IDRs) based upon their pro rata share of distributions. The IDRs are allocated 65% to the general partner and the remaining 35% to affiliates of the general partner. The IDRs allocated to the general partner are included in the net income attributable to the general partner. |
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| NRP Reports 3rd Quarter 2007 Results | | Page 8 of 10 |
Natural Resource Partners L.P.
Statements of Cash Flows
(In thousands)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | For the Nine Months Ended | |
| | | September 30, | | | September 30, | |
| | | 2007 | | | 2006 | | | 2007 | | | 2006 | |
| | | (Unaudited) | | | (Unaudited) | |
| Cash flows from operating activities: | | | | | | | | | | | | | | | | |
| Net income | | $ | 28,928 | | | $ | 25,274 | | | $ | 73,440 | | | $ | 78,842 | |
| Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | | | | | | | | | |
| Depreciation, depletion and amortization | | | 13,045 | | | | 7,009 | | | | 37,324 | | | | 22,098 | |
| Non-cash interest charge | | | 117 | | | | 97 | | | | 326 | | | | 288 | |
| Gain from sale of assets | | | — | | | | — | | | | — | | | | (2,634 | ) |
| Change in operating assets and liabilities: | | | | | | | | | | | | | | | | |
| Accounts receivable | | | (4,835 | ) | | | (2,332 | ) | | | (7,634 | ) | | | (2,439 | ) |
| Other assets | | | 326 | | | | 282 | | | | 883 | | | | 525 | |
| Accounts payable and accrued liabilities | | | 77 | | | | 255 | | | | (217 | ) | | | 235 | |
| Accrued interest | | | (2,763 | ) | | | 1,020 | | | | (166 | ) | | | 2,237 | |
| Deferred revenue | | | 2,890 | | | | 625 | | | | 10,807 | | | | 1,033 | |
| Accrued incentive plan expenses | | | 495 | | | | 996 | | | | (138 | ) | | | 2,506 | |
| Property, franchise and other taxes payable | | | 45 | | | | 158 | | | | 304 | | | | (147 | ) |
| | | | | | | | | | | | | |
| Net cash provided by operating activities | | | 38,325 | | | | 33,384 | | | | 114,929 | | | | 102,544 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Cash flows from investing activities: | | | | | | | | | | | | | | | | |
| Acquisition of land, plant and equipment, coal and other mineral rights | | | (7,435 | ) | | | (54,401 | ) | | | (40,068 | ) | | | (105,839 | ) |
| Proceeds from sale of timber assets | | | — | | | | — | | | | — | | | | 4,761 | |
| Cash placed in restricted accounts | | | 74 | | | | — | | | | (6,240 | ) | | | — | |
| | | | | | | | | | | | | |
| Net cash used in investing activities | | | (7,361 | ) | | | (54,401 | ) | | | (46,308 | ) | | | (101,078 | ) |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Cash flows from financing activities: | | | | | | | | | | | | | | | | |
| Proceeds from loans | | | 7,000 | | | | 53,000 | | | | 262,400 | | | | 103,000 | |
| Deferred financing costs | | | (6 | ) | | | — | | | | (1,292 | ) | | | — | |
| Repayments of loans | | | (400 | ) | | | — | | | | (235,942 | ) | | | (24,350 | ) |
| Distributions to partners | | | (37,635 | ) | | | (23,819 | ) | | | (108,099 | ) | | | (67,023 | ) |
| Contribution by general partner | | | — | | | | — | | | | 2,645 | | | | — | |
| | | | | | | | | | | | | |
| Net cash used in financing activities | | | (31,041 | ) | | | 29,181 | | | | (80,288 | ) | | | 11,627 | |
| | | | | | | | | | | | | |
| Net (decrease) or increase in cash and cash equivalents | | | (77 | ) | | | 8,164 | | | | (11,667 | ) | | | 13,093 | |
| Cash and cash equivalents at beginning of period | | | 54,454 | | | | 52,620 | | | | 66,044 | | | | 47,691 | |
| | | | | | | | | | | | | |
| Cash and cash equivalents at end of period | | $ | 54,377 | | | $ | 60,784 | | | $ | 54,377 | | | $ | 60,784 | |
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| SUPPLEMENTAL INFORMATION: | | | | | | | | | | | | | | | | |
| Cash paid during the period for interest | | $ | 9,752 | | | $ | 2,841 | | | $ | 21,379 | | | $ | 8,702 | |
| | | | | | | | | | | | | |
| Non-cash investing activities: | | | | | | | | | | | | | | | | |
| Units issued for assets and liabilities | | $ | — | | | $ | — | | | $ | 350,741 | | | $ | — | |
| Liability assumed in business combination | | | 39 | | | | — | | | | 1,989 | | | | — | |
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| NRP Reports 3rd Quarter 2007 Results | | Page 9 of 10 |
Natural Resource Partners L.P.
Consolidated Balance Sheets
(In thousands)
ASSETS
| | | | | | | | | |
| | | September 30, | | | December 31, | |
| | | 2007 | | | 2006 | |
| | | (Unaudited) | | | | | |
| Current assets: | | | | | | | | |
| Cash and cash equivalents | | $ | 54,377 | | | $ | 66,044 | |
| Restricted cash | | | 6,240 | | | | — | |
| Accounts receivable, net of allowance for doubtful accounts | | | 30,003 | | | | 23,357 | |
| Accounts receivable — affiliate | | | 1,009 | | | | 21 | |
| Other | | | 237 | | | | 1,411 | |
| | | | | | | |
| Total current assets | | | 91,866 | | | | 90,833 | |
| Land | | | 24,532 | | | | 17,781 | |
| Plant and equipment, net | | | 61,650 | | | | 29,615 | |
| Coal and other mineral rights, net | | | 1,004,081 | | | | 798,135 | |
| Intangible assets | | | 111,179 | | | | — | |
| Loan financing costs, net | | | 3,202 | | | | 2,197 | |
| Other assets, net | | | 825 | | | | 932 | |
| | | | | | | |
| Total assets | | $ | 1,297,335 | | | $ | 939,493 | |
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LIABILITIES AND PARTNERS’ CAPITAL
|
| | | | | | | | | |
| Current liabilities: | | | | | | | | |
| Accounts payable | | $ | 2,550 | | | $ | 1,041 | |
| Accounts payable — affiliate | | | 368 | | | | 105 | |
| Current portion of long-term debt | | | 17,234 | | | | 9,542 | |
| Accrued incentive plan expenses — current portion | | | 4,260 | | | | 5,418 | |
| Property, franchise and other taxes payable | | | 4,634 | | | | 4,330 | |
| Accrued interest | | | 3,680 | | | | 3,846 | |
| | | | | | | |
| Total current liabilities | | | 32,726 | | | | 24,282 | |
| Deferred revenue | | | 31,461 | | | | 20,654 | |
| Asset retirement obligation | | | 39 | | | | — | |
| Accrued incentive plan expenses | | | 5,599 | | | | 4,579 | |
| Long-term debt | | | 473,057 | | | | 454,291 | |
| Partners’ capital: | | | | | | | | |
| Common units | | | 661,094 | | | | 338,912 | |
| Subordinated units | | | 78,701 | | | | 83,772 | |
| General partner’s interest | | | 15,418 | | | | 12,138 | |
| Holders of incentive distribution rights | | | (48 | ) | | | 1,616 | |
| Accumulated other comprehensive loss | | | (712 | ) | | | (751 | ) |
| | | | | | | |
| Total partners’ capital | | | 754,453 | | | | 435,687 | |
| | | | | | | |
| Total liabilities and partners’ capital | | $ | 1,297,335 | | | $ | 939,493 | |
| | | | | | | |
| | |
| | | |
| NRP Reports 3rd Quarter 2007 Results | | Page 10 of 10 |
Natural Resource Partners L.P.
Reconciliation of GAAP “Net cash provided by operating activities”
To Non-GAAP “Distributable cash flow”
(In thousands)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | For the Nine Months Ended | |
| | | September 30, | | | September 30, | |
| | | 2007 | | | 2006 | | | 2007 | | | 2006 | |
| Cash flow from operations | | $ | 38,325 | | | $ | 33,384 | | | $ | 114,929 | | | $ | 102,544 | |
| Less scheduled principal payments | | | — | | | | — | | | | (9,350 | ) | | | (9,350 | ) |
| Less reserves for future principal payments | | | (4,280 | ) | | | (2,350 | ) | | | (9,080 | ) | | | (7,050 | ) |
| Add reserves used for scheduled principal payments | | | — | | | | — | | | | 9,400 | | | | 9,400 | |
| | | | | | | | | | | | | |
| Distributable cash flow | | $ | 34,045 | | | $ | 31,034 | | | $ | 105,899 | | | $ | 95,544 | |
| | | | | | | | | | | | | |
-end-
