EXHIBIT 99.1
NATURAL RESOURCE PARTNERS L.P. REPORTS FIRST QUARTER 2003 RESULTS
HOUSTON, May 8, 2003 /PRNewswire-FirstCall via COMTEX/ -- Natural Resource
Partners L.P. (NYSE: NRP) today reported net income of $8.0 million or $0.34 per
unit for the first quarter ended March 31, 2003, its first full quarter of
operations since its initial public offering in October 2002. Earnings before
interest, taxes and depletion and amortization (EBITDA) for the same period were
$14.2 million.
During the first quarter of 2003, NRP's lessees sold 9.8 million tons of coal
generating $15.4 million of coal royalty revenues for average royalty revenue
per ton of $1.57. The results include two months of coal royalty revenues
generated from NRP's acquisition of an overriding royalty interest from Alpha
Natural Resources in February.
General and administrative costs for the first quarter were higher than
originally anticipated. Included in these costs is an allowance for a potential
bad debt expense of $305,000 due to a bankruptcy petition filed by one of our
lessees. However, NRP does not anticipate any further allowances will be
required due to the bankruptcy filing. In addition, the partnership established
a policy to accrue for expenses expected to be reimbursed to its general partner
for awards granted by the Board of Directors in February under the incentive
compensation plans.
Corbin J. Robertson Jr., Chairman and Chief Executive Officer of Natural
Resource Partners L.P., said, "Our first quarter results came in as expected and
we are pleased with our performance to date. In the short time that we have been
a publicly traded partnership, we announced an increase in our distributions to
unitholders, closed three acquisitions and have grown our reserves by more than
30%. Our strategy is to continue to grow our assets in a way that is accretive
to our unitholders."
2003 Outlook
For 2003, Natural Resource Partners expects its lessees to produce between 40.5
million tons and 43.0 million tons of coal with approximately 82% to 84% being
produced in Appalachia, 4% to 6% in the Illinois Basin and 9% to 11% from the
Northern Powder River Basin. This production should generate coal royalty
revenues of approximately $65 million to $69.5 million with total revenues of
approximately $75 million to $79 million based upon average selling prices
provided by its lessees. General and administrative costs are forecasted to
range between $6.7 and $6.9 million. NRP expects net income to be between $34
million and $37 million, with depletion and amortization expected to range
between $23 million and $25 million.
Revenues are anticipated to be higher in the second half of 2003 due to
increased production and the full year impact of the acquisitions made thus far
in 2003. General and administrative costs will be generally higher in the first
half of the year due to the allowance for bad debts, annual audit, annual report
and K-1 reporting requirements for its unitholders. The above estimates assume
average borrowings of $108 million remain drawn under the current credit
facility.
Distributions
On May 15, 2003, Natural Resource Partners will make a distribution of $12.1
million or $0.5225 per unit on all 22.7 million limited partner units
outstanding as well as the 2% distribution with respect to the general partner
interest. This distribution represents an increase of $0.01 per unit over the
minimum quarterly distribution established at the time of the initial public
offering and equates to an
annualized distribution of $2.09 per unit.
Disclosure of Non-GAAP Financial Measures
NRP calculates EBITDA by adding depletion, amortization and interest expense to
net income. EBITDA is not presented in accordance with generally accepted
accounting principles (GAAP) and is not intended to be used in lieu of GAAP
presentations of results of operations or cash provided by operating activities.
EBITDA is presented because management believes it provides additional
information with respect to both the performance of our fundamental business
activities as well as our ability to meet our future debt service, working
capital requirements and minimum distributions. Management also believes that
debt holders and investment analysts commonly use EBITDA to analyze company
performance. A reconciliation of EBITDA to net income is included in the tables
attached to this release.
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 in the three major coal producing regions of the United States:
Appalachia, the Illinois Basin and the Powder River Basin.
For additional information, please contact Kathy Hager at 713-751-7555 or
khager@nrplp.com . Further information about NRP is available on the
partnership's website at http://www.nrplp.com .
This press release may include "forward-looking statements" as defined by the
Securities and Exchange Commission. Such statements are those concerning the
2003 outlook for earnings, production, revenues and expenses. 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.
- financials follow -
NATURAL RESOURCE PARTNERS L.P.
Operating Statistics
Three Months Ended March 31, 2003
(in thousands except per ton data)
Coal royalty revenues:
Appalachia $12,713
Illinois Basin 865
Northern Powder River Basin 1,831
Total $15,409
Sales volumes (tons):
Appalachia 7,496
Illinois Basin 721
Northern Powder River Basin 1,601
Total 9,818
Average gross royalty per ton
Appalachia $1.70
Illinois Basin 1.20
Northern Powder River Basin 1.14
Total $1.57
NATURAL RESOURCE PARTNERS L.P.
Condensed Statement of Income
Three Months Ended March 31, 2003
(in thousands)
(unaudited)
Revenues:
Coal royalties $15,409
Minimums recognized as revenue 804
Override royalties 461
Other 1,396
Total revenues 18,070
Operating costs and expenses:
Depletion and amortization 5,804
General administrative and other 2,564
Taxes other than income 1,160
Royalty payments 150
Total operating costs and expenses 9,678
Operating income 8,392
Other income (expense):
Interest expense (466)
Interest income 47
Net income $7,973
Net income attributable to general partner $159
Net income attributable to limited partners $7,814
Basic and diluted net income per limited partner unit
Common $0.34
Subordinated $0.34
Weighted average number of units outstanding:
Common 11,354
Subordinated 11,354
NATURAL RESOURCE PARTNERS L.P.
Statement of Cash Flows
Three Months Ended March 31, 2003
(in thousands)
(unaudited)
Cash flows from operating activities:
Net income $7,973
Adjustments to reconcile net income to net cash
provided by operating activities-
Depletion and amortization 5,804
Change in current assets and liabilities-
Accounts receivable 2,093
Other assets 163
Accounts payable (956)
Deferred revenue 421
Accrued liabilities 191
Property and franchise taxes payable (320)
Net cash provided by operating
activities 15,369
Cash flows from investing activities:
Acquisition of property (11,852)
Net cash used in investing activities (11,852)
Cash flows from financing activities:
Proceeds from loans 11,500
Distributions to partners (9,811)
Net cash provided by financing
activities 1,689
Net increase in cash 5,206
Cash beginning of period 7,753
Cash end of period $12,959
Supplemental information:
Cash paid during the period for interest $391
NATURAL RESOURCE PARTNERS L.P.
Condensed Balance Sheets
(in thousands)
(unaudited)
March 31, December 31,
2003 2002
Current assets $20,257 $17,307
Property and equipment, net 380,345 374,187
Other assets 1,115 1,225
Total assets $401,717 $392,719
Current liabilities $2,187 $3,333
Long term debt 69,000 57,500
Deferred revenue 13,673 13,252
Long term incentive award 61 ---
Partner's capital 316,796 318,634
Total liabilities and partners' capital $401,717 $392,719
Supplemental information
Long term debt $69,000 $57,500
Partner's capital 316,796 318,634
Total capitalization $385,796 $376,134
Long term debt/Total capitalization 18% 15%
NATURAL RESOURCE PARTNERS L.P.
Supplemental Information and Reconciliations of Unaudited GAAP
Financial Measures to Non-GAAP Financial Measures
Three Months Ended March 31, 2003
(in thousands)
Reconciliation of Net Income to EBITDA
Net income $7,973
Adjustments to reconcile to EBITDA
Interest income (47)
Interest expense 466
Income taxes ---
Depletion and amortization 5,804
EBITDA $14,196
SOURCE Natural Resource Partners L.P.
Kathy Hager of Natural Resource Partners L.P., +1-713-751-7555,
or khager@nrplp.com
http://www.nrplp.com