Macquarie Infrastructure Company LLC | Exhibit 99.1 |
| | |
| 125 W. 55th Street | |
| New York, NY 10019 | |
| USA | |
Media Release
FIRST QUARTER 2008 FINANCIAL RESULTS Growth in Airport Services Drives Increased Distributable Cash Net Swings to Loss on Non-Cash Expenses of Investee Increased Quarterly Dividend of $0.645 Per Share Declared | |
| · | Revenue increased 65% compared to the first quarter of 2007 on improved performance by MIC’s businesses generally and contributions from acquisitions completed in 2007. |
| · | The net loss for the quarter was primarily the result of higher non-cash expenses including derivatives losses incurred by International Matex Tank Terminals (IMTT), a business in which MIC holds a 50% interest and depreciation and amortization resulting from acquisitions completed in 2007. MIC reported net income of $7.9 million for the first quarter of 2007. |
Reported gross profit increased 50% to $112.6 million for the quarter compared to $75.2 million in 2007. Analysis of gross profit, or revenues less costs of goods sold/sales, provides additional insight into the performance of the Company by removing the volatility in revenue associated with costs that are typically passed through to customers by infrastructure businesses.
MIC also reported a year over year increase in estimated cash available for distribution (“CAD”). CAD for the quarter increased to $30.8 million, or by 10%, over the $28.0 million generated in the first quarter of 2007.
CAD is a non-GAAP measure used by the Company to estimate its ability to sustain and increase its quarterly dividend. CAD is based on cash from operating activities less financed capital expenditures, plus the cash dividend received from an unconsolidated business recorded in cash from investing activity.
On the strength of the improvement in estimated cash available for distribution, the Company will pay a cash dividend of $0.645 per share for the first quarter of 2008. The dividend of $0.645 per share represents a 9.3% increase over the $0.59 per share paid for the first quarter of 2007 and the eighth consecutive quarterly increase. The dividend will be paid on June 10, 2008 to shareholders of record on June 4, 2008.
“Our businesses have again demonstrated an ability to generate growing amounts of distributable cash, even against the backdrop of a challenging economic environment” said Peter Stokes, Chief Executive Officer of Macquarie Infrastructure Company. “We’re pleased to be able to share that growth with investors in the form of an increased dividend.”
OPERATING BUSINESSES PERFORMANCE HIGHLIGHTS
MIC reports EBITDA and contribution margin, both of which are non-GAAP financial measures, as it considers them to be important indicators of overall performance. The attached tables provide a reconciliation of EBITDA to net income, and contribution margin to revenue. The Company believes that EBITDA, net of other non-cash and non-recurring items, also provides insight into the performance of certain of its operating companies and their ability to generate distributable cash. The reporting of contribution margin by the gas production and distribution business provides additional insight into the performance of that business net of changes in feedstock (naptha) prices that typically are recovered in revenue.
| · | Gross profit in the Company’s airport services business was $95.3 million for the quarter, an increase of 67% over the first quarter in 2007. Gross profit at comparable locations (excluding acquisitions concluded in the prior 12 months) increased 4%. |
| | o | The business benefited from a higher volume of fuel sold (both on a same store basis and as a result of acquisitions made in 2007), increased hangar/office rental income and increased de-icing revenue relative to the first quarter in 2007. Weighted average margins on fuel sales were relatively unchanged versus the first quarter in 2007. |
| | o | Total EBITDA increased to $40.4 million or by 58% over the first quarter in 2007. EBITDA at existing locations (excluding acquisitions concluded in the prior 12 months) increased 8%. Excluding non-cash losses on derivative instruments in both periods, EBITDA would have increased by 53% and 5% for total locations and existing locations, respectively. |
| · | The Company’s bulk liquid storage terminal business declared a dividend of $14.0 million, $7.0 million of which is payable to MIC, for the first quarter of 2008. The dividend payment was accrued at quarter-end and cash was received on April 25, 2008. As an owner of 50% of this business, MIC does not consolidate the financial results of the bulk liquid storage terminal business with those of its controlled businesses. |
| o | MIC expects to receive a dividend of $7.0 million each quarter through the end of 2008. Beginning with the first quarter in 2009, the Company expects to receive a dividend equal to 50% of the cash from operations, less 50% of maintenance and environmental remediation capital expenditures, generated by this business, subject to satisfaction of certain conditions. |
| o | Terminal revenue increased to $74.2 million, or by 20%, in the first quarter of 2008 from $61.9 million in 2007. The increase was the result of higher average storage rates, an increase in rented storage capacity resulting from an acquisition completed in the fourth quarter of 2007 and higher throughput revenue. Terminal gross profit increased 24% over the first quarter in 2007. |
| o | The business recorded a non-cash loss of $17.7 million in the quarter on changes in the value of derivative instruments (interest rate hedges). This resulted in the business generating a net loss for the quarter of $1.8 million. MIC’s share of the non-cash loss, after taxes, was approximately $6.0 million. As a result, MIC recorded a loss including its amortization of acquired tangible and intangible assets, of $2.1 million on its investment in the bulk liquid storage terminal business. |
| o | Reported EBITDA declined 56% to $12.3 million from $27.9 million in 2007. Excluding non-cash losses on derivative instruments in both periods, EBITDA would have increased by 7%. |
| o | Cash flow from operations in the bulk liquid storage terminal business decreased to $24.8 million from $31.0 million in the first quarter of 2007, despite an increase in operating income, due to increases in working capital requirements and interest paid. |
| · | The Company’s gas production and distribution business generated a total contribution margin (revenue less cost of revenue) of $16.2 million, or a 5% increase, over the first quarter of 2007. The total volume of gas sold during the first quarter was flat with the prior comparable period. |
| o | Revenue increases in both utility and non-utility operations were partially offset by higher product costs (feedstock and LPG) and higher operating expenses (production, transmission and distribution, and selling, general and administrative expenses). |
| o | The business generated EBITDA for the quarter of $7.0 million, an increase of 8% over the first quarter of 2007. Excluding non-cash losses on derivative instruments in both periods, EBITDA would have increased by 4%. |
| · | The Company’s district energy business gross profit declined to $2.6 million, or by 2%, and EBITDA declined to $3.0 million, or by 9% compared with the first quarter in 2007. |
| o | Capacity revenue grew with the increase in the number of customers connected to the Chicago system. A cooler first quarter compared to the first quarter of 2007 resulted in lower consumption revenue. The first quarter of the year is generally the coolest, resulting in a lower level of demand relative to other quarters. |
| o | Direct expenses related to normal pre-season maintenance increased as a greater percentage of the work was concluded in the first quarter of 2008 compared to the first quarter of 2007. The first quarter is typically the quarter in which the bulk of annual preventive maintenance is performed. |
| · | Gross profit at the Company’s airport parking business declined 27% to $3.3 million in the first quarter of 2008 compared with the same period in 2007. EBITDA declined 39% to $2.5 million. Factors influencing the results for the quarter include: |
| o | relatively level volume of cars out and average revenue per car due to certain underperforming markets which are offsetting overall growth; and, |
| o | increased operating costs associated with improving customer service, marketing and bus fleet quality, which began in the second quarter of 2007, as well as a larger fleet size and higher fuel costs; and, |
| o | higher selling, general and administrative costs primarily due to accrued expense for a state sales tax assessment and also due to management changes related to strengthening senior management and implementing a regional management structure; and, |
| o | ongoing yield management efforts implemented to maximize revenue as the quality of customer service improve. |
ESTIMATED CASH AVAILABLE FOR DISTRIBUTION
The Company believes that it can provide better insight into its ability to support its distributions by making certain adjustments to its “as reported” results. For example, its results under Generally Accepted Accounting Principles (“GAAP”) alone do not reflect all of the items that management considers in estimating distributable cash. The table below summarizes MIC’s estimated cash available for distribution (“CAD”), beginning with cash from operations and adjusted for certain dividend income and cash expenditures.
Estimated cash available for distribution totaled $30.8 million for the quarter; a 10% increase over the $28.0 million generated in the first quarter of 2007.
($ Millions) | | Total | |
| | | | |
| Cash from operations | | $ | 14.10 | |
| | | | | |
| Cash from operations adjustments | | $ | 5.20 | |
| | | | | |
| Cash from investing and financing activities | | $ | 4.56 | |
| | | | | |
| Working capital | | $ | 6.92 | |
| | | | | |
| Estimated Cash Available for Distribution | | $ | 30.78 | |
MIC’s consolidated cash from operations decreased to $14.1 million in the first quarter of 2008 from $27.6 million in the first quarter of 2007. Factors contributing to the lower cash from operations compared to the first quarter in 2007 include:
| | o | a $10.8 million increase in working capital balances, mainly from higher accounts receivable balances due to higher fuel prices and timing; |
| | o | increased interest expense due to higher levels of debt; |
| | o | $3.5 million in equity distributions from IMTT in cash provided by operating activities in 2007, with the remaining $3.5 million in cash from investing activities, compared with the entire $7.0 million distribution being included in cash from investing activities in 2008; |
| | o | underperformance at our airport parking business; and |
| | o | operating costs from the acquisitions in our airport services business since the date of each acquisition, which should reduce over time as the acquired sites become fully integrated with our existing sites; partially offset by |
| | o | higher operating income from the airport services and gas production and distribution businesses. |
Estimated CAD is increased by adjustments to cash from operations including:
| | o | a $3.0 million reversal of a federal income tax liability at the airport services business which will be offset in 2008 against net operating loss carryforwards of MIC LLC; and, |
| | o | $1.3 million of pre-funded integration costs related to acquisitions made by the airport services business; and, |
| | o | a $1.0 million recovery of fuel adjustment charges by the gas production and distribution business from an escrow account established for that purpose at the time of our acquisition. |
Estimated CAD is increased by a net $4.6 million in cash from investing and financing activities that includes:
| | o | the $7.0 million dividend from the Company’s investment in the bulk liquid storage terminal business that does not flow through earnings; |
| | o | $2.2 million of cash released from debt service reserves; |
| | o | $7.2 million of the capital expenditures in the period that were primarily growth-related and therefore debt funded; offset by |
| | o | $13.7 million of capital expenditures paid in cash or accrued. |
Estimated CAD is further increased by $6.9 million of cash generated in reversal of working capital adjustments excluded in prior periods.
The Company estimates that cash available for distribution exceeded the dividend paid for the quarter by $1.8 million.
BUSINESS UPDATE AND OUTLOOK
Airport services business - MIC expects continued strong performance from its airport services business. General aviation aircraft manufacturers continue to report strong demand for new planes. The increased number of planes in service and the increase in the hours that general aviation aircraft are being flown is expected to continue to drive growth in the volume of fuel sold. Management of the airport services business believes that improved access to general aviation and the challenges facing commercial aviation associated with higher load levels, potential mainline carrier consolidations, bankruptcies and security-related delays will result in the business being relatively insensitive to downturns in the broader economy.
The business is focused on successfully completing the integration of the 29 FBOs acquired in 2007. As with prior acquisitions, the integration effort is expected to eliminate overlapping functions and reduce operating expenses.
Bulk liquid storage terminal business - The performance of the bulk liquid storage terminal business is expected to continue to improve as inflation escalators generate revenue growth from existing contracts and storage tanks currently under construction become operational. Approximately $382.4 million of growth capital expenditure commitments have been made in the bulk liquid storage terminal business since the beginning of 2006 including $8.0 million of projects initiated prior to MIC’s investment. The Company expects that the capital projects will generate an incremental increase in annual gross profit and EBITDA of $48.7 million when complete.
The business expects to incur increased maintenance capital expenditures related to mandated Spill Prevention, Control and Countermeasure (SPCC) tank inspections and repairs. The increased expenditures for the SPCC program pertain to tanks in Louisiana and could add as much as $20 million per year to aggregate maintenance capital expenditures during the balance of 2008 and each year through 2012. As a result, estimates of average total annual maintenance capital expenditures have been increased to a range of $35 - $50 million from a range of $30 - $40 million per year.
After December 31, 2008, when our distributions from IMTT will convert from a fixed amount to a variable amount generally based on its cash flow from operations and cash from investing activities less maintenance capital expenditures, these increases will reduce amounts that would otherwise be distributed to us from IMTT.
Gas production and distribution business - The fundamental driver of continued growth in the gas production and distribution business will be the rate of population increases in Hawaii. MIC also believes that it can effectively market its synthetic natural gas and liquid petroleum gas products as an efficient, environmentally friendly energy source thereby increasing its market share relative to other fuel/power sources. In addition, MIC believes that the business will continue to be a stable source of distributable cash based on the essential services nature of the business.
District energy business - The Company expects continued stable performance from its district energy business, assuming a historically normal level of demand for cooling during the summer of 2008. The business will increase saleable tons of cooling through expansion of chilling and pumping capacity and improvements in system hydrology. The expansion of system capacity will be undertaken only when contracts for cooling have been signed and not on a speculative basis.
Airport parking business - Service enhancements, a larger shuttle fleet and yield management strategies, including implementation of lot-level technology for tracking activity, are having a positive impact on the performance of the locations at which these initiatives have been implemented. The execution of these initiatives on a wider scale is expected to generate improvement in revenue over the balance of the year.
The primary driver of the volume of cars out, the forecast rate of growth in the number of commercial enplanements is forecast to be approximately 3% in the markets in which the business operates. We expect that effective marketing of the business will result in a comparable level of growth in cars out in the business. However, in the first quarter of 2008, the airline industry experienced some bankruptcies and various airlines have altered their service routes. Individually none of these changes would necessarily be material to our airport parking business but in combination they may cause declines in revenue.
CONFERENCE CALL AND WEBCAST
When: Management has scheduled a conference call for 11:00 a.m. Eastern Standard Time on May 8, 2008 to review the Company’s results.
How: To listen to the conference call, please dial +1(877) 591-4957 (domestic) or +1(719) 325-4850 (international), at least 10 minutes prior to the scheduled start time. Interested parties can also listen to the live call, which will be webcast at the Company website, www.macquarie.com/mic/. Please allow extra time prior to the call to visit the site and download the necessary software to listen to the Internet broadcast.
Slides: The Company has also prepared slides in support of its conference call presentation. The slides will be available for downloading from the Company website the morning of May 8, 2008, prior to the conference call. A link to the slides will be located in the “Latest News” section of the MIC homepage.
Replay: For interested individuals unable to join the conference call, a replay will be available through May 22, 2008, at +1(888) 203-1112 (domestic) or +1(719) 457-0820 (international), Passcode: 6889241. An online archive of the webcast will be available on the Company’s website for one year following the call.
ABOUT MACQUARIE INFRASTRUCTURE COMPANY
Macquarie Infrastructure Company owns, operates and invests in a diversified group of infrastructure businesses, which provide basic, everyday services, to customers in the United States. Its businesses consist of an airport services business, a 50% indirect interest in a bulk liquid storage terminal business, a gas production and distribution business, a district energy business, and an airport parking business. The Company is managed by a wholly-owned subsidiary of the Macquarie Group. For additional information, please visit the Macquarie Infrastructure Company website at www.macquarie.com/mic.
FORWARD LOOKING STATEMENTS
This filing contains forward-looking statements. We may, in some cases, use words such as "project”, "believe”, "anticipate”, "plan”, "expect”, "estimate”, "intend”, "should”, "would”, "could”, "potentially”, or "may” or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. Forward-looking statements in this report are subject to a number of risks and uncertainties, some of which are beyond our control including, among other things: our ability to successfully integrate and manage acquired businesses, retain or replace qualified employees, manage growth, make and finance future acquisitions, service, comply with the terms of and refinance debt, and implement our strategy, our shared decision-making with co-investors over investments including the distribution of dividends, our regulatory environment establishing rate structures and monitoring quality of service, changes in general economic or business conditions, demographic trends, the political environment, the economy, tourism, construction and transportation costs, air travel, automobile usage, fuel and gas costs, our ability to recover increases in costs from customers, reliance on sole or limited source suppliers, foreign exchange fluctuations, risks or conflicts of interests involving our relationship with the Macquarie Group, environmental risks and changes in U.S. federal tax law.
Our actual results, performance, prospects or opportunities could differ materially from those expressed in or implied by the forward-looking statements. Additional risks of which we are not currently aware could also cause our actual results to differ. In light of these risks, uncertainties and assumptions, you should not place undue reliance on any forward-looking statements. The forward-looking events discussed in this release may not occur. These forward-looking statements are made as of the date of this release. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
“Macquarie Group” refers to the Macquarie Group of companies, which comprises Macquarie Group Limited and its worldwide subsidiaries and affiliates. Macquarie Infrastructure Company LLC is not an authorized deposit-taking institution for the purposes of the Banking Act 1959 (Commonwealth of Australia) and its obligations do not represent deposits or other liabilities of Macquarie Bank Limited ABN 46 008 583 542 (MBL). MBL does not guarantee or otherwise provide assurance in respect of the obligations of Macquarie Infrastructure Company LLC. MIC-G
FOR FURTHER INFORMATION, PLEASE CONTACT:
Investor enquiries Jay A. Davis Investor Relations Macquarie Infrastructure Company (212) 231-1825 | Media enquiries Alex Doughty Corporate Communications Macquarie Infrastructure Company (212) 231-1710 |
MACQUARIE INFRASTRUCTURE COMPANY LLC |
CONSOLIDATED BALANCE SHEETS |
($ in thousands, except share data) |
| | | March 31, 2008 | | December 31, 2007 | |
| | | (Unaudited) | | | |
Assets | | | | | | | |
| Current assets: | | | | | | | |
| Cash and cash equivalents | | $ | 61,304 | | $ | 57,473 | |
| Restricted cash | | | 1,312 | | | 1,335 | |
| Accounts receivable, less allowance for doubtful accounts | | | | | | | |
| of $2,103 and $2,380, respectively | | | 107,067 | | | 94,541 | |
| Dividends receivable | | | 7,000 | | | 7,000 | |
| Other receivables | | | 75 | | | 445 | |
| Inventories | | | 19,470 | | | 18,219 | |
| Prepaid expenses | | | 10,180 | | | 10,418 | |
| Deferred income taxes | | | 9,330 | | | 9,330 | |
| Other | | | 12,364 | | | 11,706 | |
| | | | | | | | |
| Total current assets | | | 228,102 | | | 210,467 | |
| | | | | | | | |
| Property, equipment, land and leasehold improvements, net | | | 690,221 | | | 674,952 | |
| | | | | | | | |
| Restricted cash | | | 19,786 | | | 19,363 | |
| Equipment lease receivables | | | 38,176 | | | 38,834 | |
| Investment in unconsolidated business | | | 202,518 | | | 211,606 | |
| Goodwill | | | 775,565 | | | 770,108 | |
| Intangible assets, net | | | 873,716 | | | 857,345 | |
| Deferred costs on acquisitions | | | - | | | 278 | |
| Deferred financing costs, net of accumulated amortization | | | 28,067 | | | 28,040 | |
| Other | | | 2,042 | | | 2,036 | |
| | | | | | | | |
| Total assets | | $ | 2,858,193 | | $ | 2,813,029 | |
| | | | | | | | |
Liabilities and members' equity | | | | | | | |
| Current liabilities: | | | | | | | |
| Due to manager - related party | | $ | 4,704 | | $ | 5,737 | |
| Accounts payable | | | 68,933 | | | 59,303 | |
| Accrued expenses | | | 25,934 | | | 31,184 | |
| Current portion of notes payable and capital leases | | | 6,461 | | | 5,094 | |
| Current portion of long-term debt | | | 4,394 | | | 162 | |
| Fair value of derivative instruments | | | 38,153 | | | 14,224 | |
| Customer deposits | | | 8,983 | | | 9,481 | |
| Other | | | 9,248 | | | 8,330 | |
| | | | | | | | |
| Total current liabilities | | | 166,810 | | | 133,515 | |
| | | | | | | | |
| Notes payable and capital leases, net of current portion | | | 3,013 | | | 2,964 | |
| Long-term debt, net of current portion | | | 1,490,821 | | | 1,426,494 | |
| Deferred income taxes | | | 182,476 | | | 202,683 | |
| Fair value of derivative instruments | | | 71,121 | | | 42,832 | |
| Other | | | 32,521 | | | 30,817 | |
| | | | | | | | |
| Total liabilities | | | 1,946,762 | | | 1,839,305 | |
| | | | | | | | |
| Minority interests | | | 6,726 | | | 7,172 | |
| | | | | | | | |
| Commitments and contingencies | | | - | | | - | |
| | | | | | | | |
| Members’ equity: | | | | | | | |
| LLC interests, no par value; 500,000,000 authorized; 44,938,380 LLC interests | | | | | | | |
| issued and outstanding at March 31, 2008 and December 31, 2007 | | | 1,023,480 | | | 1,052,062 | |
| Accumulated other comprehensive loss | | | (64,330 | ) | | (33,055 | ) |
| Accumulated deficit | | | (54,445 | ) | | (52,455 | ) |
| | | | | | | | |
| Total members’ equity | | | 904,705 | | | 966,552 | |
| | | | | | | | |
| Total liabilities and members’ equity | | $ | 2,858,193 | | $ | 2,813,029 | |
MACQUARIE INFRASTRUCTURE COMPANY LLC |
CONSOLIDATED STATEMENTS OF OPERATIONS |
(Unaudited) |
($ in thousands, except per share data) |
| | | Quarter Ended March 31, 2008 | | Quarter Ended March 31, 2007 | |
| | | | | | |
Revenue | | | | | | | |
| Revenue from product sales | | $ | 159,325 | | $ | 88,357 | |
| Revenue from product sales - utility | | | 29,399 | | | 22,291 | |
| Service revenue | | | 88,785 | | | 57,086 | |
| Financing and equipment lease income | | | 1,194 | | | 1,248 | |
| | | | | | | | |
| Total revenue | | | 278,703 | | | 168,982 | |
| | | | | | | | |
Costs and expenses | | | | | | | |
| Cost of product sales | | | 108,517 | | | 53,706 | |
| Cost of product sales - utility | | | 24,335 | | | 16,778 | |
| Cost of services | | | 33,256 | | | 23,342 | |
| Selling, general and administrative | | | 63,857 | | | 38,978 | |
| Fees to manager - related party | | | 4,626 | | | 5,561 | |
| Depreciation | | | 6,723 | | | 3,891 | |
| Amortization of intangibles | | | 10,739 | | | 6,928 | |
| | | | | | | | |
| Total operating expenses | | | 252,053 | | | 149,184 | |
| | | | | | | | |
Operating income | | | 26,650 | | | 19,798 | |
| | | | | | | | |
Other income (expense) | | | | | | | |
| Interest income | | | 473 | | | 1,459 | |
| Interest expense | | | (25,826 | ) | | (17,566 | ) |
| Equity in (losses) earnings and amortization | | | | | | | |
| charges of investees | | | (2,089 | ) | | 3,465 | |
| Loss on derivative instruments | | | (305 | ) | | (477 | ) |
| Other income (expense), net | | | 192 | | | (916 | ) |
| Net (loss) income before income taxes and | | | (905 | ) | | 5,763 | |
| minority interests | | | | | | | |
| (Provision) benefit for income taxes | | | (1,364 | ) | | 2,045 | |
| | | | | | | | |
| Net (loss) income before minority interests | | | (2,269 | ) | | 7,808 | |
| | | | | | | | |
| Minority interests | | | (279 | ) | | (69 | ) |
| | | | | | | | |
Net (loss) income | | $ | (1,990 | ) | $ | 7,877 | |
| | | | | | | | |
| Basic (loss) earnings per share: | | $ | (0.04 | ) | $ | 0.21 | |
| Weighted average number of shares | | | | | | | |
| outstanding: basic | | | 44,938,380 | | | 37,562,165 | |
| Diluted (loss) earnings per share: | | $ | (0.04 | ) | $ | 0.21 | |
| Weighted average number of shares | | | | | | | |
| outstanding: diluted | | | 44,938,380 | | | 37,579,034 | |
| Cash distributions declared per share | | $ | 0.635 | | $ | 0.57 | |
MACQUARIE INFRASTRUCTURE COMPANY LLC |
CONSOLIDATED STATEMENTS OF CASH FLOWS |
(Unaudited) |
($ in thousands) |
| | | Quarter Ended March 31, 2008 | | Quarter Ended March 31, 2007 | |
Operating activities | | | | | | | |
| Net (loss) income | | $ | (1,990 | ) | $ | 7,877 | |
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | | | | | | | |
| Depreciation and amortization of property and equipment | | | 9,469 | | | 6,357 | |
| Amortization of intangible assets | | | 10,739 | | | 6,928 | |
| Equity in losses (earnings) and amortization charges of investees | | | 2,089 | | | (3,465 | ) |
| Equity distributions from investees | | | - | | | 3,465 | |
| Amortization of debt financing costs | | | 1,760 | | | 1,451 | |
| Non-cash derivative loss (gain), net of non-cash interest expense | | | 382 | | | (1,093 | ) |
| Performance fees settled in LLC interests | | | - | | | 957 | |
| Equipment lease receivable, net | | | 508 | | | 708 | |
| Deferred rent | | | 572 | | | 640 | |
| Deferred taxes | | | (2,590 | ) | | (3,020 | ) |
| Other non-cash expenses, net | | | 73 | | | 424 | |
| Non-operating losses relating to foreign investments | | | - | | | 2,465 | |
| Changes in other assets and liabilities, net of acquisitions: | | | | | | | |
| Restricted cash | | | 23 | | | 259 | |
| Accounts receivable | | | (12,191 | ) | | (4,015 | ) |
| Inventories | | | (800 | ) | | (841 | ) |
| Prepaid expenses and other current assets | | | 1,272 | | | 1,371 | |
| Due to manager - related party | | | (1,033 | ) | | 181 | |
| Accounts payable and accrued expenses | | | 2,444 | | | 3,355 | |
| Income taxes payable | | | 3,577 | | | 2,838 | |
| Other, net | | | (207 | ) | | 729 | |
| Net cash provided by operating activities | | | 14,097 | | | 27,571 | |
| | | | | | | | |
Investing activities | | | | | | | |
| Acquisitions of businesses and investments, net of cash acquired | | | (41,864 | ) | | (143 | ) |
| Costs of dispositions | | | - | | | (322 | ) |
| Proceeds from sale of equity investment | | | - | | | 84,977 | |
| Settlements of non-hedging derivative instruments | | | - | | | (1,631 | ) |
| Purchases of property and equipment | | | (13,708 | ) | | (7,558 | ) |
| Return of investment in unconsolidated business | | | 7,000 | | | 3,535 | |
| Other | | | 137 | | | - | |
| Net cash (used in) provided by investing activities | | | (48,435 | ) | | 78,858 | |
| | | | | | | | |
Financing activities | | | | | | | |
| Proceeds from long-term debt | | | 2,000 | | | 1,000 | |
| Proceeds from line of credit facilities | | | 67,850 | | | 1,750 | |
| Offering and equity raise costs paid | | | (65 | ) | | - | |
| Distributions paid to holders of LLC interests | | | (28,536 | ) | | - | |
| Distributions paid to minority shareholders | | | (167 | ) | | (224 | ) |
| Payment of long-term debt | | | (40 | ) | | (39 | ) |
| Debt financing costs paid | | | (1,788 | ) | | (54 | ) |
| Change in restricted cash | | | (617 | ) | | 751 | |
| Payment of notes and capital lease obligations | | | (468 | ) | | (596 | ) |
| Net cash provided by financing activities | | | 38,169 | | | 2,588 | |
| | | | | | | | |
| Effect of exchange rate changes on cash | | | - | | | (1 | ) |
| | | | | | | | |
| Net change in cash and cash equivalents | | | 3,831 | | | 109,016 | |
| | | | | | | | |
| Cash and cash equivalents, beginning of period | | | 57,473 | | | 37,388 | |
| | | | | | | | |
| Cash and cash equivalents, end of period | | $ | 61,304 | | $ | 146,404 | |
| | | | | | | | |
Supplemental disclosures of cash flow information: | | | | | | | |
| Non-cash investing and financing activities: | | | | | | | |
| | | | | | | | |
| Accrued acquisition and equity offering costs | | $ | 343 | | $ | 1,078 | |
| | | | | | | | |
| Accrued purchases of property and equipment | | $ | 742 | | $ | 2,393 | |
| | | | | | | | |
| Acquisition of equipment through capital leases | | $ | - | | $ | 30 | |
| | | | | | | | |
| Taxes paid | | $ | 489 | | $ | 960 | |
| | | | | | | | |
| Interest paid | | $ | 23,859 | | $ | 16,131 | |
MACQUARIE INFRASTRUCTURE COMPANY LLC
RECONCILIATION OF NET (LOSS) INCOME TO EBITDA
For the Quarters Ended March 31, 2008 and 2007
($ in thousands)
| | | Quarter Ended March 31, | | Change Favorable/(Unfavorable) | |
| | 2008 | | 2007 | | $ | | % | |
| | | | | | | | | | |
| Net (loss) income | | $ | (1,990 | ) | $ | 7,877 | | | | | | | |
| Interest expense, net | | | 25,353 | | | 16,107 | | | | | | | |
| Provision (benefit) for income taxes | | | 1,364 | | | (2,045 | ) | | | | | | |
| Depreciation (1) | | | 6,723 | | | 3,891 | | | | | | | |
| Depreciation - cost of services (1) | | | 2,746 | | | 2,466 | | | | | | | |
| Amortization (2) | | | 10,739 | | | 6,928 | | | | | | | |
| EBITDA | | $ | 44,935 | | $ | 35,224 | | | 9,711 | | | 27.6 | |
| (1) Depreciation - cost of services includes depreciation expense for our district energy business and airport parking business, which are reported in cost of services in our consolidated statements of operations. Depreciation and Depreciation - cost of services does not include step-up depreciation expense of $1.7 million for each quarter in connection with our investment in IMTT, which is reported in equity in (losses) earnings and amortization charges of investees in our statements of operations. |
| |
| (2) Amortization does not include step-up amortization expense of $283,000 for each quarter related to intangible assets in connection with our investment in IMTT, which is reported in equity in (losses) earnings and amortization charges of investees in our statements of operations. |
MACQUARIE INFRASTRUCTURE COMPANY LLC
RECONCILIATION OF SEGMENT NET (LOSS) INCOME TO EBITDA AND
SEGMENT REVENUE TO CONTRIBUTION MARGIN
For the Quarters Ended March 31, 2008 and 2007
AIRPORT SERVICES BUSINESS - Total Locations (Including Acquisitions) |
| |
| | | Q1 2008 | | Q1 2007 | | YTD Change Favorable/(Unfavorable) | |
| | | $ | | | | $ | | | |
| | | | | | | | | | |
Revenue | | | | | | | | | | | | | |
| Fuel revenue | | | 136,366 | | | 69,847 | | | 66,519 | | | 95.2 | |
| Non-fuel revenue | | | 62,584 | | | 31,213 | | | 31,371 | | | 100.5 | |
| Total revenue | | | 198,950 | | | 101,060 | | | 97,890 | | | 96.9 | |
| | | | | | | | | | | | | | |
Cost of revenue | | | | | | | | | | | | | |
| Cost of revenue-fuel | | | 91,882 | | | 40,578 | | | (51,304 | ) | | (126.4 | ) |
| Cost of revenue-non-fuel | | | 11,800 | | | 3,421 | | | (8,379 | ) | | NM | |
| Total cost of revenue | | | 103,682 | | | 43,999 | | | (59,683 | ) | | (135.6 | ) |
| | | | | | | | | | | | | | |
| Fuel gross profit | | | 44,484 | | | 29,269 | | | 15,215 | | | 52.0 | |
| Non-fuel gross profit | | | 50,784 | | | 27,792 | | | 22,992 | | | 82.7 | |
| Gross profit | | | 95,268 | | | 57,061 | | | 38,207 | | | 67.0 | |
| | | | | | | | | | | | | | |
| Selling, general and administrative expenses | | | 54,625 | | | 30,535 | | | (24,090 | ) | | (78.9 | ) |
| Depreciation and amortization | | | 14,637 | | | 7,963 | | | (6,674 | ) | | (83.8 | ) |
| Operating income | | | 26,006 | | | 18,563 | | | 7,443 | | | 40.1 | |
| | | | | | | | | | | | | | |
| Interest expense, net | | | (15,838 | ) | | (8,261 | ) | | (7,577 | ) | | (91.7 | ) |
| Other income (expense) | | | (16 | ) | | (23 | ) | | 7 | | | 30.4 | |
| Unrealized gains (losses) on derivative instruments | | | (199 | ) | | (949 | ) | | 750 | | | 79.0 | |
| (Provision) benefit for income taxes | | | (4,011 | ) | | (3,699 | ) | | (312 | ) | | (8.4 | ) |
Net income (1) | | | 5,942 | | | 5,631 | | | 311 | | | 5.5 | |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
Reconciliation of net income to EBITDA: | | | | | | | | | | | | | |
| Net income (1) | | | 5,942 | | | 5,631 | | | | | | | |
| Interest expense, net | | | 15,838 | | | 8,261 | | | | | | | |
| Provision (benefit) for income taxes | | | 4,011 | | | 3,699 | | | | | | | |
| Depreciation and amortization | | | 14,637 | | | 7,963 | | | | | | | |
| EBITDA | | | 40,428 | | | 25,554 | | | 14,874 | | | 58.2 | |
| NM - Not meaningful |
|
| (1) Corporate allocation expense, and the federal tax effect, have been excluded from the above table as they are eliminated on consolidation at the MIC Inc. level. |
AIRPORT SERVICES BUSINESS - Existing Locations (Excluding Acquisitions)
| | | | | | | | | | |
| | | Q1 2008 | | Q1 2007 | | YTD Change Favorable/(Unfavorable) | |
| | | $ | | $ | | $ | | % | |
| | | ($ in thousands) (unaudited) | | | | | |
Revenue | | | | | | | | | | | | | |
| Fuel revenue | | | 84,986 | | | 69,847 | | | 15,139 | | | 21.7 | |
| Non-fuel revenue | | | 35,565 | | | 31,213 | | | 4,352 | | | 13.9 | |
| Total revenue | | | 120,551 | | | 101,060 | | | 19,491 | | | 19.3 | |
| | | | | | | | | | | | | | |
Cost of revenue | | | | | | | | | | | | | |
| Cost of revenue-fuel | | | 56,781 | | | 40,578 | | | (16,203 | ) | | (39.9 | ) |
| Cost of revenue-non-fuel | | | 4,603 | | | 3,421 | | | (1,182 | ) | | (34.6 | ) |
| Total cost of revenue | | | 61,384 | | | 43,999 | | | (17,385 | ) | | (39.5 | ) |
| | | | | | | | | | | | | | |
| Fuel gross profit | | | 28,205 | | | 29,269 | | | (1,064 | ) | | (3.6 | ) |
| Non-fuel gross profit | | | 30,962 | | | 27,792 | | | 3,170 | | | 11.4 | |
| Gross profit | | | 59,167 | | | 57,061 | | | 2,106 | | | 3.7 | |
| | | | | | | | | | | | | | |
| Selling, general and administrative expenses | | | 31,337 | | | 30,535 | | | (802 | ) | | (2.6 | ) |
| Depreciation and amortization | | | 7,988 | | | 7,963 | | | (25 | ) | | (0.3 | ) |
| Operating income | | | 19,842 | | | 18,563 | | | 1,279 | | | 6.9 | |
| | | | | | | | | | | | | | |
| Interest expense, net | | | (8,595 | ) | | (8,261 | ) | | (334 | ) | | (4.0 | ) |
| Other income (expense) | | | (29 | ) | | (23 | ) | | (6 | ) | | (26.1 | ) |
| Unrealized gains (losses) on derivative instruments | | | (232 | ) | | (949 | ) | | 717 | | | 75.6 | |
| (Provision) benefit for income taxes | | | (3,595 | ) | | (3,699 | ) | | 104 | | | 2.8 | |
Net income (1) | | | 7,391 | | | 5,631 | | | 1,760 | | | 31.3 | |
| | | | | | | | | | | | | | |
Reconciliation of net income to EBITDA: | | | | | | | | | | | | | |
| Net income (1) | | | 7,391 | | | 5,631 | | | | | | | |
| Interest expense, net | | | 8,595 | | | 8,261 | | | | | | | |
| Provision (benefit) for income taxes | | | 3,595 | | | 3,699 | | | | | | | |
| Depreciation and amortization | | | 7,988 | | | 7,963 | | | | | | | |
| EBITDA | | | 27,569 | | | 25,554 | | | 2,015 | | | 7.9 | |
| (1) Corporate allocation expense, and the federal tax effect, have been excluded from the above table as they are eliminated on consolidation at the MIC Inc. level. |
| | | | | | | | | |
| | | | | | | | | | |
| | | Q1 2008 | | Q1 2007 | | YTD Change Favorable/(Unfavorable) | |
| | | $ | | $ | | $ | | % | |
| | | ($ in thousands) (unaudited) | | | | | |
Revenue | | | | | | | | | | | | | |
| Terminal revenue | | | 74,224 | | | 61,876 | | | 12,348 | | | 20.0 | |
| Environmental response revenue | | | 4,170 | | | 8,540 | | | (4,370 | ) | | (51.2 | ) |
Total revenue (1) | | | 78,394 | | | 70,416 | | | 7,978 | | | 11.3 | |
| | | | | | | | | | | | | | |
Costs and expenses | | | | | | | | | | | | | |
| Terminal operating costs | | | 38,542 | | | 32,990 | | | (5,552 | ) | | (16.8 | ) |
| Environmental response operating costs | | | 3,729 | | | 6,886 | | | 3,157 | | | 45.8 | |
Total operating costs (1) | | | 42,271 | | | 39,876 | | | (2,395 | ) | | (6.0 | ) |
| | | | | | | | | | | | | | |
| Terminal gross profit | | | 35,682 | | | 28,886 | | | 6,796 | | | 23.5 | |
| Environmental response gross profit | | | 441 | | | 1,654 | | | (1,213 | ) | | (73.3 | ) |
Gross profit | | | 36,123 | | | 30,540 | | | 5,583 | | | 18.3 | |
| | | | | | | | | | | | | | |
| General and administrative expenses | | | 6,830 | | | 5,569 | | | (1,261 | ) | | (22.6 | ) |
| Depreciation and amortization | | | 10,334 | | | 8,522 | | | (1,812 | ) | | (21.3 | ) |
Operating income | | | 18,959 | | | 16,449 | | | 2,510 | | | 15.3 | |
| | | | | | | | | | | | | | |
| Interest expense, net | | | (4,719 | ) | | (3,407 | ) | | (1,312 | ) | | (38.5 | ) |
| Other income (1) | | | 557 | | | 3,173 | | | (2,616 | ) | | 82.4 | |
| Unrealized gains (losses) on derivative instruments | | | (17,720 | ) | | (242 | ) | | (17,478 | ) | | NM | |
| Benefit (provision) for income taxes | | | 956 | | | (6,423 | ) | | 7,379 | | | 114.9 | |
| Minority interest | | | 155 | | | (27 | ) | | 182 | | | NM | |
Net (loss) income | | | (1,812 | ) | | 9,523 | | | (11,335 | ) | | (119.0 | ) |
| | | | | | | | | | | | | | |
Reconciliation of net (loss) income to EBITDA: | | | | | | | | | | | | | |
| Net (loss) income | | | (1,812 | ) | | 9,523 | | | | | | | |
| Interest expense, net | | | 4,719 | | | 3,407 | | | | | | | |
| (Benefit) provision for income taxes | | | (956 | ) | | 6,423 | | | | | | | |
| Depreciation and amortization | | | 10,334 | | | 8,522 | | | | | | | |
| EBITDA | | | 12,285 | | | 27,875 | | | (15,590 | ) | | (55.9 | ) |
| NM - Not meaningful | | | | | | |
| | | | | | | |
| (1) In the fourth quarter of 2007, nursery revenue and nursery operating costs were removed from total revenue and total operating costs, and included within other income. Prior period comparatives have been updated to reflect this change. |
| | | | | | | |
| | | | | | | | | | |
| | | Q1 2008 | | Q1 2007 | | YTD Change Favorable/(Unfavorable) | |
| | | $ | | $ | | $ | | % | |
| | | ($ in thousands) (unaudited) | | | | | |
Contribution margin | | | | | | | | | | | | | |
| Revenue - utility | | | 29,399 | | | 22,291 | | | 7,108 | | | 31.9 | |
| Cost of revenue - utility | | | 21,724 | | | 14,591 | | | (7,133 | ) | | (48.9 | ) |
| Contribution margin - utility | | | 7,675 | | | 7,700 | | | (25 | ) | | (0.3 | ) |
| | | | | | | | | | | | | | |
| Revenue - non-utility | | | 22,959 | | | 18,510 | | | 4,449 | | | 24.0 | |
| Cost of revenue - non-utility | | | 14,424 | | | 10,811 | | | (3,613 | ) | | (33.4 | ) |
| Contribution margin - non-utility | | | 8,535 | | | 7,699 | | | 836 | | | 10.9 | |
| | | | | | | | | | | | | | |
Total contribution margin | | | 16,210 | | | 15,399 | | | 811 | | | 5.3 | |
| | | | | | | | | | | | | | |
| Production | | | 1,217 | | | 1,121 | | | (96 | ) | | (8.6 | ) |
| Transmission and distribution | | | 3,605 | | | 3,383 | | | (222 | ) | | (6.6 | ) |
| Selling, general and administrative expenses | | | 4,413 | | | 4,080 | | | (333 | ) | | (8.2 | ) |
| Depreciation and amortization | | | 1,668 | | | 1,731 | | | 63 | | | 3.6 | |
| Operating income | | | 5,307 | | | 5,084 | | | 223 | | | 4.4 | |
| | | | | | | | | | | | | | |
| Interest expense, net | | | (2,311 | ) | | (2,245 | ) | | (66 | ) | | (2.9 | ) |
| Other income (expense) | | | 71 | | | (53 | ) | | 124 | | | NM | |
| Unrealized gains (losses) on derivative instruments | | | (21 | ) | | (267 | ) | | 246 | | | 92.1 | |
| Provision for income taxes | | | (1,192 | ) | | (986 | ) | | (206 | ) | | (20.9 | ) |
Net income (1) | | | 1,854 | | | 1,533 | | | 321 | | | 20.9 | |
| | | | | | | | | | | | | | |
Reconciliation of net income to EBITDA: | | | | | | | | | | | | | |
| Income before taxes (1) | | | 1,854 | | | 1,533 | | | | | | | |
| Interest expense, net | | | 2,311 | | | 2,245 | | | | | | | |
| Provision for income taxes | | | 1,192 | | | 986 | | | | | | | |
| Depreciation and amortization | | | 1,668 | | | 1,731 | | | | | | | |
| EBITDA | | | 7,025 | | | 6,495 | | | 530 | | | 8.2 | |
| NM - Not meaningful | | | | | | |
| | | | | | | |
| (1) Corporate allocation expense has been excluded from the above table as it is eliminated on consolidation at the MIC Inc. level. |
| | | | | | | | | |
| | | | | | | | |
| | | Q1 2008 | | Q1 2007 | | YTD Change Favorable/(Unfavorable) | |
| | | $ | | $ | | $ | | % | |
| | | ($ in thousands) (unaudited) | | | | | |
| | | | | | | | | | |
| Cooling capacity revenue | | | 4,806 | | | 4,551 | | | 255 | | | 5.6 | |
| Cooling consumption revenue | | | 1,768 | | | 1,862 | | | (94 | ) | | (5.0 | ) |
| Other revenue | | | 732 | | | 649 | | | 83 | | | 12.8 | |
| Finance lease revenue | | | 1,194 | | | 1,248 | | | (54 | ) | | (4.3 | ) |
| Total revenue | | | 8,500 | | | 8,310 | | | 190 | | | 2.3 | |
| Direct expenses — electricity | | | 1,176 | | | 1,483 | | | 307 | | | 20.7 | |
| Direct expenses — other (1) | | | 4,703 | | | 4,149 | | | (554 | ) | | (13.4 | ) |
| Direct expenses — total | | | 5,879 | | | 5,632 | | | (247 | ) | | (4.4 | ) |
| Gross profit | | | 2,621 | | | 2,678 | | | (57 | ) | | (2.1 | ) |
| Selling, general and administrative expenses | | | 992 | | | 768 | | | (224 | ) | | (29.2 | ) |
| Amortization of intangibles | | | 341 | | | 337 | | | (4 | ) | | (1.2 | ) |
| Operating income | | | 1,288 | | | 1,573 | | | (285 | ) | | (18.1 | ) |
| Interest expense, net | | | (2,544 | ) | | (2,087 | ) | | (457 | ) | | (21.9 | ) |
| Other income (expense) | | | 64 | | | 74 | | | (10 | ) | | (13.5 | ) |
| Unrealized gains (losses) on derivative instruments | | | (30 | ) | | - | | | (30 | ) | | NM | |
| Benefit (provision) for income taxes | | | 354 | | | 213 | | | 141 | | | 66.2 | |
| Minority interest | | | (145 | ) | | (132 | ) | | (13 | ) | | (9.8 | ) |
Net income (loss) (2) | | | (1,013 | ) | | (359 | ) | | (654 | ) | | 182.2 | |
| | | | | | | | | | | | | | |
Reconciliation of net income (loss) to EBITDA: | | | | | | | | | | | | | |
| Net income (loss) (2) | | | (1,013 | ) | | (359 | ) | | | | | | |
| Interest expense, net | | | 2,544 | | | 2,087 | | | | | | | |
| (Benefit) provision for income taxes | | | (354 | ) | | (213 | ) | | | | | | |
| Depreciation | | | 1,476 | | | 1,431 | | | | | | | |
| Amortization of intangibles | | | 341 | | | 337 | | | | | | | |
| EBITDA | | | 2,994 | | | 3,283 | | | (289 | ) | | (8.8 | ) |
| NM - Not meaningful | | | | | | |
| | | | | | | |
| (1) Includes depreciation. | | | | | | |
| (2) Corporate allocation expense, and the federal tax effect, have been excluded from the above table as they are eliminated on consolidation at the MIC Inc. level. |
| | | | | | | | | |
| | | | | | | | | | |
| | | Q1 2008 | | Q1 2007 | | YTD Change Favorable/(Unfavorable) | |
| | | $ | | $ | | $ | | % | |
| | | ($ in thousands) (unaudited) | | | | | |
| | | | | | | | | | |
| Revenue | | | 18,895 | | | 18,811 | | | 84 | | | 0.4 | |
| Direct expenses (1) | | | 15,577 | | | 14,289 | | | (1,288 | ) | | (9.0 | ) |
| Gross profit | | | 3,318 | | | 4,522 | | | (1,204 | ) | | (26.6 | ) |
| Selling, general and administrative expenses | | | 2,694 | | | 1,613 | | | (1,081 | ) | | (67.0 | ) |
| Amortization of intangibles | | | 816 | | | 788 | | | (28 | ) | | (3.6 | ) |
| Operating income | | | (192 | ) | | 2,121 | | | (2,313 | ) | | (109.1 | ) |
| Interest expense, net | | | (3,887 | ) | | (3,966 | ) | | 79 | | | 2.0 | |
| Other income (expense) | | | 72 | | | (10 | ) | | 82 | | | NM | |
| Unrealized gains (losses) on derivative instruments | | | 77 | | | (70 | ) | | 147 | | | NM | |
| Benefit for income taxes | | | 1,501 | | | 763 | | | 738 | | | 96.7 | |
| Minority interest | | | 424 | | | 201 | | | 223 | | | 110.9 | |
Net loss (2) | | | (2,005 | ) | | (961 | ) | | (1,044 | ) | | 108.6 | |
| | | | | | | | | | | | | | |
Reconciliation of net loss to EBITDA: | | | | | | | | | | | | | |
| Net loss (2) | | | (2,005 | ) | | (961 | ) | | | | | | |
| Interest expense, net | | | 3,887 | | | 3,966 | | | | | | | |
| Benefit for income taxes | | | (1,501 | ) | | (763 | ) | | | | | | |
| Depreciation | | | 1,270 | | | 1,035 | | | | | | | |
| Amortization of intangibles | | | 816 | | | 788 | | | | | | | |
| EBITDA | | | 2,467 | | | 4,065 | | | (1,598 | ) | | (39.3 | ) |
| (1) Includes depreciation expense and non-cash rent in excess of lease. |
| (2) Corporate allocation expense, and the federal tax effect, have been excluded from the above table as they are eliminated on consolidation at the MIC Inc. level. |
