EXHIBIT 99.1
[NORTHERN BORDER PARTNERS, L.P. LOGO] News 13710 FNB Parkway
Release Omaha, NE 68154-5200
For Further Information
Contact:
Media Contact:
Beth Jensen
(402) 492-3400
Investor Contacts:
Ellen Konsdorf
(877) 208-7318
NORTHERN BORDER PARTNERS, L.P.
REPORTS FIRST QUARTER RESULTS
AND UPDATES 2005 GUIDANCE
FOR IMMEDIATE RELEASE: Tuesday, May 3, 2005
OMAHA - Northern Border Partners, L.P. (NYSE - NBP) today reported first
quarter 2005 net income of $34.7 million or $0.69 per unit compared to net
income of $36.6 million or $0.73 per unit in the first quarter 2004. Cash flows
as measured by earnings before interest, taxes, depreciation and amortization
(EBITDA) were $90.7 million in the first quarter 2005 down from $91.3 million in
the first quarter of 2004.
First quarter 2004 net income reflected one additional day of revenue of
$0.9 million on Northern Border Pipeline due to the leap year ($0.6 million net
to the Partnership) and a $2.8 million special income allocation from Bighorn
Gas Gathering. Adjustments to gas imbalance accounts on Viking Gas Transmission
resulted in $1.9 million ($1.2 million net of income taxes) lower income in
2005. Excluding the effects of these items, adjusted 2005 net income would have
been greater than that realized in 2004 by $2.7 million.
"Our first quarter results exceeded our expectations. Those results were
driven by strong performance primarily in the gathering and processing business
segment. The pipeline segment also had solid performance in the first quarter
when you take into account certain items that impact the comparison to last
year. Overall, we were pleased with first quarter performance," said Bill
Cordes, chief executive officer of Northern Border Partners.
"Looking at the total year 2005, we recently announced that for the
remainder of the year, the effects of unsold capacity on Northern Border
Pipeline were greater than expected. Therefore, we're reducing earnings guidance
for the year by approximately $0.10 per unit to a range of $2.40 - $2.50 per
unit."
FIRST QUARTER 2005 RESULTS INCLUDED:
o Increased operating income of $63.6 million, compared with $61.7 million
one year ago, as a result of strong performance primarily in the gathering
and processing business segment.
o Operations and maintenance expenses included $0.9 million in transition
costs that should end after May.
o Discontinued operations of $0.4 million related to resolution of matters
for the Canadian operations that were sold in 2004.
o Higher consolidated interest expense of $21.2 million, compared with $18.6
million in first quarter 2004, due to higher average interest rates
partially offset by lower average debt outstanding.
o Decreased equity earnings from investments due to a $2.8 million special
income allocation in Bighorn Gas Gathering that was realized in first
quarter 2004. A similar special income allocation of $2.6 million is
anticipated later in 2005.
o Distributable cash flow (DCF) for first quarter 2005 was $47.4 million
($0.96 per unit) compared to $56.9 million ($1.17 per unit) in the first
quarter 2004. The decrease in distributable cash flow is primarily
attributable to the timing of several maintenance capital expenditure
projects that occurred in the first quarter of 2005.
INTERSTATE NATURAL GAS PIPELINE SEGMENT
The interstate natural gas pipeline segment contributed reported net
income of $32.1 million in first quarter 2005, compared to $34.3 million in
first quarter 2004. The primary differences between the periods were:
o Northern Border Pipeline's $0.9 million operating revenue impact ($0.6
million net to the Partnership) that resulted from one less business day
in first quarter 2005 than existed in 2004, which was a leap year.
o Increased operations and maintenance expenses included $1.9 million of
adjustments ($1.2 million net of income taxes) to gas imbalance accounts
on Viking Gas Transmission.
Average daily throughput increased 2.7% in the quarter totaling 3,501 million
cubic feet per day (mmcfd) compared with 3,409 mmcfd in first quarter 2004.
NATURAL GAS GATHERING AND PROCESSING SEGMENT
Net income during first quarter 2005 was $13.7 million, an increase of 29
percent or $3.1 million, quarter over quarter. The primary differences between
the periods were:
o Gathering and processing volumes in the Williston Basin were 60 mmcfd
compared to 50 mmcfd in first quarter 2004, a 20 percent increase, due to
expansions and increased utilization of the Grasslands and Marmarth
systems.
o Increased prices for natural gas and natural gas liquids, net of hedging.
Average prices realized during the period were $0.86 per gallon of liquids
and $5.64 per thousand cubic feet (mcf) of gas. The combined impact of
increased inlet volumes and prices realized was an increase in gross
margins for Williston Basin of $6.9 million or 66 percent.
o Total gathered volumes for the segment increased to 1,049 mmcfd as
compared to 975 mmcfd for 2004.
o Volumes on the Partnership's wholly-owned gathering systems in the Powder
River Basin of 210 mmcfd versus 194 mmcfd in first quarter 2004, which
resulted in revenue of $7.7 million compared to $8.8 million in first
quarter 2004.
To facilitate greater understanding, the table below summarizes the
wholly-owned Powder River Basin activities by service level. Levels of service
are separated into low pressure and intermediate/high pressure gathering because
of the significant difference in volumes and fees related to the categories of
service. Low pressure gathering involves providing service from a central
delivery point to the downstream pipeline, which is a higher margin service.
Intermediate/high pressure gathering is providing service after the gas has been
aggregated and compressed by producers. This service requires less capital and
expense and, as a result, is a lower margin service.
2
WHOLLY-OWNED POWDER RIVER BASIN GATHERING
<Table>
<Caption>
================================================================================
FIRST QUARTER 2005 FIRST QUARTER 2004
LEVELS OF SERVICE % OF VOLUME % OF REVENUE % OF VOLUME % OF REVENUE
- --------------------------------------------------------------------------------
LOW PRESSURE 71.2% 89.3% 81.3% 92.8%
INTERMEDIATE/HIGH
PRESSURE 28.8 10.7 18.7 7.2
- --------------------------------------------------------------------------------
TOTAL 100.0% 100.0% 100.0% 100.0%
================================================================================
</Table>
COAL SLURRY PIPELINE SEGMENT
Net income remained at $0.7 million for first quarter 2005, matching that
for first quarter 2004. Higher electric power costs increased operating expenses
which were passed through as increased revenue from the coal slurry pipeline's
customer.
The interested parties continue to work to resolve environmental, water
supply, and recontracting issues surrounding the continued operation of the
Mohave Generating Station after its planned shutdown in January 2006. The
Partnership believes successful resolution of these issues should result in
reconstruction of the coal slurry line in 2008 and 2009.
BUSINESS OUTLOOK
Net income for 2005 is now expected to range from $122 million to $126
million ($2.40 to $2.50 per unit). EBITDA is now expected to be in the range of
$337 million to $347 million. Distributable cash flow is expected to be $164
million to $168 million or $3.29 to $3.39 per unit.
NORTHERN BORDER PARTNERS
RECONCILIATION OF EBITDA TO NET INCOME - PROJECTED 2005
<Table>
<Caption>
==================================================================================
INTERSTATE
NATURAL GAS GAS GATHERING
CONSOLIDATED PIPELINES & PROCESSING COAL SLURRY
- ----------------------------------------------------------------------------------
LOW HIGH LOW HIGH LOW HIGH LOW HIGH
- ----------------------------------------------------------------------------------
EBITDA $337 $347 $262 $271 $71 $76 $7 $8
MINORITY INTEREST (40) (44) (40) (44) - - - -
INTEREST EXPENSE, NET (84) (86) (42) (43) - - - -
DEPRECIATION &
AMORTIZATION
EXPENSE (86) (88) (66) (67) (16) (17) (3) (4)
INCOME TAXES (2) (4) (2) (3) - - (1) (1)
- ----------------------------------------------------------------------------------
NET INCOME (1) $122 $126 $108 $113 $55 $58 $3 $3
==================================================================================
</Table>
(1) The reconciliation of EBITDA and Net Income does not total due to use of
ranges for the various components of the reconciliation and unallocated
Partnership expenses.
INTERSTATE NATURAL GAS PIPELINE SEGMENT
The Partnership previously disclosed that Northern Border Pipeline had
contracts for firm transportation capacity primarily on the Port of Morgan,
Montana to Ventura, Iowa portion of the line expiring during 2005. For the month
of April 2005, approximately 600 mmcfd of firm transportation capacity on
Northern Border Pipeline was available for contracting and was not
3
sold. The Partnership believes that the primary contributor to the unsold
capacity is the high level of gas delivered to Canadian storage due to unusually
high summer to winter price differentials.
The following summarizes the contracting status of this segment of the
pipeline as of May 1, 2005:
NORTHERN BORDER PIPELINE 2005 CAPACITY (MMCFD)
PORT OF MORGAN, MONTANA TO VENTURA, IOWA
<Table>
<Caption>
==================================================================================
MAY JUN - OCT NOV - DEC
- ----------------------------------------------------------------------------------
MAXIMUM-RATE FIRM CONTRACTS 1,730 1,685 1,402
DISCOUNTED-RATE FIRM 304(1) -- --
CONTRACTS
AVAILABLE CAPACITY 340 689 972
- ----------------------------------------------------------------------------------
TOTAL SUMMER DESIGN CAPACITY 2,374 2,374 2,374
==================================================================================
(1) Average of 78% of maximum rate for one month.
The Partnership has discounted rates on a short-term only basis in order
to maximize overall revenue. Depending on daily gas market conditions,
additional daily firm or interruptible services may be sold during the month and
would generate additional revenue.
As Canadian storage continues to fill, the Partnership believes the
opportunity for contracting on Northern Border Pipeline should improve. The
Partnership also believes that the greatest risk of unsold capacity exists
during the second quarter but some weakness could continue through the balance
of the year based on weather conditions and mid-continent prices. Consequently,
the Partnership now expects that the most likely range of impact on Northern
Border Pipeline's revenue from unsold capacity in 2005 is $15 million to $28
million ($11 million to $20 million net to the Partnership).
Accordingly, the Partnership is revising its expectations for 2005 EBITDA
from the interstate natural gas pipeline segment downward by approximately eight
percent to a total level of $262 million to $271 million.
GATHERING AND PROCESSING SEGMENT
The Partnership is increasing its expectations for EBITDA from this
business segment to be approximately $71 million to $76 million for the year
2005, an increase of 21 percent above original estimates.
Factors included in guidance for this segment are:
o Full year average volumes in the Williston Basin in the range of 61
mmcfd to 65 mmcfd.
o A scheduled discontinuation of 45 mmcfd of immediate/high pressure
gathering services in second quarter 2005 in the Powder River Basin,
resulting in average daily gathered volumes of 175 mmcfd to 200
mmcfd for 2005.
o Realization of first quarter 2005 commodity pricing levels with
combined hedging of 58% of natural gas and natural gas liquids at
average prices of $7.11 per mcf and $0.92 per gallon, respectively.
4
o Favorable resolution of a dispute with the partner in Bighorn Gas
Gathering resulting in the realization of a special income
allocation of $2.6 million later in 2005.
DISTRIBUTION DECLARATION
On April 19, 2005, the Partnership Policy Committee declared the
Partnership's quarterly cash distribution of $0.80 per unit for the first
quarter of 2005. The indicated annual rate is $3.20. The distribution is payable
May 13, 2005 to unitholders of record on April 29, 2005.
CONFERENCE CALL
Northern Border Partners will host a conference call on Wednesday, May 4,
2005 at 10:00 a.m. Eastern Time to review first quarter 2005 results and discuss
2005 guidance. This call may be accessed via the Partnership's website at
http://www.northernborderpartners.com. An audio replay of the call will be
available through May 11, 2005 by dialing, toll free in the United States and
Canada, 800-405-2236 and entering passcode 11028396.
NON-GAAP FINANCIAL MEASURES
The Partnership has disclosed in this press release EBITDA and DCF amounts
that are non-GAAP financial measures. Management believes EBITDA and DCF provide
useful information to investors as a measure of comparability to peer companies.
However, these calculations may vary from company to company, so the
Partnership's computations may not be comparable to other companies'. Management
further uses EBITDA to compare the financial performance of its segments and to
internally manage those business segments. First quarter 2005 and 2004
reconciliations of EBITDA to net income and to cash flow from operating
activities, and computations of DCF are included in the financial information
with this release. On a consolidated basis, EBITDA is reconciled to cash flow
from operating activities determined under GAAP. For segment information of this
press release, EBITDA is reconciled to net income rather than to cash flow from
operating activities, since the Partnership does not determine segment cash flow
from operating activities due to its intercompany cash management activity.
Reconciliations of 2005 projected EBITDA to projected net income and
computations of projected DCF are also attached to this release.
Northern Border Partners, L.P. is a publicly traded partnership formed to
own, operate and acquire a diversified portfolio of energy assets. The
Partnership owns and manages natural gas pipelines and is engaged in the
gathering and processing of natural gas. More information can be found at
http://www.northernborderpartners.com.
FORWARD LOOKING STATEMENT
This press release includes forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Although Northern Border Partners, L.P. believes that its
expectations are based on reasonable assumptions, it can give no assurance that
such expectations will be achieved. Important factors that could cause actual
results to differ materially from those in the forward-looking statements
include natural gas development in the Western Canadian Sedimentary Basin;
competitive conditions in the overall natural gas and electricity markets; our
ability to market pipeline capacity on favorable terms; the impact of unsold
firm transportation capacity on Northern Border Pipeline or our other pipelines
being greater than expected; the availability of additional storage capacity;
weather conditions; performance of contractual obligations by the shippers; our
ability to recover costs in pipeline rates relating to the settlement with the
Fort Peck Tribes on rights-of-way and tax issues; prices of natural gas and
natural gas liquids; the rate of development, gas quality, and competitive
conditions in gas fields near the Partnership's natural gas gathering systems in
the Powder River and Williston Basins and its investments in the Powder River
and Wind River Basins; successful resolution of the special income allocation
related to a cash distribution from our preferred A interest in Bighorn Gas
Gathering; regulatory actions and receipt of expected regulatory clearances;
regulatory actions relative to rate recovery of income tax allowances for
partnerships; renewal of the coal slurry transportation contract under favorable
terms and preparation for a possible temporary shutdown of the coal slurry
pipeline; any costs related to changes in the systems and services currently
provided to us by Enron Corp. and CrossCountry Energy and their affiliates and
costs related to replacing these systems and services or transitioning them to
ONEOK; actions by rating agencies; our ability to complete acquisitions or
growth projects and their future
5
performance; timely receipt of right-of-way, regulatory clearances and approval
for the expansion projects; our ability to control operating costs; and
conditions in the capital markets and our ability to access the capital markets.
######
NORTHERN BORDER PARTNERS, L.P.
FINANCIAL HIGHLIGHTS
--------------------
(Unaudited: In Millions Except Per Unit Amounts)
<Table>
<Caption>
FIRST QUARTER
2005 2004
------------------ ----------------
Operating Revenue $160.4 $143.7
Income From Continuing Operations $34.3 $35.8
Net Income $34.7 $36.6
Per Unit Income From Continuing Operations $0.68 $0.71
Per Unit Net Income $0.69 $0.73
Cash Flows From Operating Activities $67.1 $73.3
EBITDA (1) $90.7 $91.3
Distributable Cash Flow $47.4 $56.9
Distributable Cash Flow Per Unit $0.96 $1.17
CONSOLIDATED STATEMENT OF INCOME
--------------------------------
(Unaudited: In Millions Except Per Unit Amounts)
FIRST QUARTER
2005 2004
------------------ ----------------
Operating Revenue $160.4 $143.7
------------------ ----------------
Operating Expenses
Product Purchases 32.5 21.4
Operations and Maintenance 33.1 29.4
Depreciation and Amortization 21.4 21.5
Taxes Other Than Income 9.8 9.7
------------------ ----------------
Total Operating Expenses 96.8 82.0
------------------ ----------------
Operating Income 63.6 61.7
Interest Expense, Net (21.2) (18.6)
Other Income, Net 0.5 0.3
Equity Earnings from Investments 4.5 6.4
Minority Interest (12.2) (12.5)
------------------ ----------------
Income From Continuing Operations Before Income Taxes 35.2 37.3
Income Taxes 0.9 1.5
------------------ ----------------
Income From Continuing Operations 34.3 35.8
Discontinued Operations, net of tax 0.4 0.8
------------------ ----------------
Net Income $34.7 $36.6
================== ================
Per Unit Income From Continuing Operations $0.68 $0.71
================== ================
Per Unit Net Income $0.69 $0.73
================== ================
Average Units Outstanding 46.4 46.4
================== ================
NORTHERN BORDER PARTNERS, L.P.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
---------------------------------------------
(Unaudited: In Millions Except Per Unit Amounts)
RECONCILIATION OF EBITDA TO NET INCOME FIRST QUARTER
2005 2004
------------------ ----------------
EBITDA (1) $90.7 $91.3
Minority Interest (12.2) (12.5)
Interest Expense, Net (21.2) (18.6)
Depreciation and Amortization (including amounts in Other
Income, Net and Discontinued Operations) (21.4) (21.7)
Income taxes (including amounts in Discontinued Operations) (1.2) (1.9)
------------------ ----------------
Net Income $34.7 $36.6
================== ================
RECONCILIATION OF EBITDA TO CASH FLOWS FROM OPERATING ACTIVITIES
EBITDA (1) $90.7 $91.3
Interest Expense, Net (21.2) (18.6)
Changes in Current Assets and Liabilities 3.7 6.4
Equity Earnings from Investments (4.5) (6.4)
Distributions Received from Equity Investments 1.2 5.7
Changes in Reserves and Deferred Credits (0.3) (2.4)
Other (2.5) (2.7)
------------------ ----------------
Cash Flows From Operating Activities $67.1 $73.3
================== ================
RECONCILIATION OF EBITDA TO DISTRIBUTABLE CASH FLOW
EBITDA (1) $90.7 $91.3
Interest Expense, Net (21.2) (18.6)
Maintenance Capital (6.1) (0.7)
Distributions to Minority Interest (16.2) (14.5)
Other 0.2 (0.6)
------------------ ----------------
Distributable Cash Flow $47.4 $56.9
================== ================
Distributable Cash Flow Per Unit $0.96 $1.17
================== ================
NORTHERN BORDER PARTNERS, L.P.
OTHER FINANCIAL INFORMATION
---------------------------
(Unaudited: In Millions)
MARCH 31, DECEMBER 31,
2005 2004
------------------ ----------------
SUMMARY BALANCE SHEET DATA
Total assets by segment:
Interstate Natural Gas Pipeline $1,892.2 $1,900.6
Natural Gas Gathering and Processing 573.0 570.1
Coal Slurry Pipeline 17.2 18.3
Other (assets not allocated to segments) 19.0 21.6
------------------ ----------------
Total consolidated assets $2,501.4 $2,510.6
================== ================
Consolidated capitalization:
Long-term debt, including current maturities $1,328.8 $1,330.4
Partners' capital 774.9 780.2
Minority interests in partners' equity 286.0 290.1
Accumulated other comprehensive income 6.4 9.2
------------------ ----------------
Total capitalization 2,396.1 2,409.9
Consolidated other current liabilities and reserves and deferred credits 105.3 100.7
------------------ ----------------
Total liabilities and capitalization $2,501.4 $2,510.6
================== ================
FIRST QUARTER
2005 2004
------------------ ----------------
CAPITAL EXPENDITURES AND EQUITY INVESTMENTS (2)
Maintenance -
Interstate Natural Gas Pipeline $4.6 $0.3
Natural Gas Gathering and Processing 1.0 0.3
Coal Slurry Pipeline 0.0 0.1
Other 0.5 0.0
------------------ ----------------
6.1 0.7
------------------ ----------------
Growth -
Interstate Natural Gas Pipeline 0.8 0.2
Natural Gas Gathering and Processing 4.4 1.2
Coal Slurry Pipeline 0.0 0.0
------------------ ----------------
5.2 1.4
------------------ ----------------
Total $11.3 $2.1
================== ================
(1) EBITDA is computed from (a) net income plus (b) minority interest; (c)
interest expense, net; (d) income taxes; and (e) depreciation and
amortization less (f) equity AFUDC.
(2) Management classifies expenditures that are expected to generate additional
revenues or significant operating efficiency as growth capital expenditures
and equity investments. Any remaining capital expenditures are classified as
maintenance.
(3) Volume information presented in operating results includes 100% of the
volumes for joint ventures and equity investments as well as for
wholly-owned subsidiaries.
NORTHERN BORDER PARTNERS, L.P.
SUMMARY SEGMENT INFORMATION
---------------------------
(Unaudited)
FIRST QUARTER
2005 2004
------------------ ----------------
INTERSTATE NATURAL GAS PIPELINE SEGMENT
Operating Results (3):
Gas Delivered (mmcf) 306,692 302,898
Average Throughput (mmcfd) 3,501 3,409
Financial Results (In Millions):
Operating Revenue $96.6 $97.6
------------------ ----------------
Operating Expenses
Operations and Maintenance 15.7 13.5
Depreciation and Amortization 16.5 16.6
Taxes Other Than Income 8.8 8.9
------------------ ----------------
Total Operating Expenses 41.0 39.0
------------------ ----------------
Operating Income 55.6 58.6
Interest Expense, Net (11.2) (10.9)
Other Income, Net 0.2 0.1
Equity Earnings from Investments 0.5 0.5
------------------ ----------------
Income Before Income Taxes 45.1 48.3
Income Taxes 0.8 1.5
------------------ ----------------
Net Income 44.3 46.8
Net Income to Minority Interest (12.2) (12.5)
------------------ ----------------
Net Income to Northern Border Partners $32.1 $34.3
================== ================
EBITDA (1) $72.8 $75.9
================== ================
Distributions from Northern Border Pipeline:
Paid to Northern Border Partners $37.9 $33.7
Paid to Minority Interest $16.2 $14.5
------------------ ----------------
Total Distributions $54.1 $48.2
================== ================
RECONCILIATION OF EBITDA TO NET INCOME
EBITDA (1) $72.8 $75.9
Minority Interest (12.2) (12.5)
Interest Expense, Net (11.2) (10.9)
Depreciation and Amortization (16.5) (16.7)
Income taxes (0.8) (1.5)
------------------ ----------------
Net Income $32.1 $34.3
================== ================
NORTHERN BORDER PARTNERS, L.P.
SUMMARY SEGMENT INFORMATION
---------------------------
(Unaudited)
FIRST QUARTER
2005 2004
------------------ ----------------
NATURAL GAS GATHERING AND PROCESSING SEGMENT
Operating Results (3):
Volumes (mmcfd):
Gathering 1,049 975
Processing 60 50
Financial Results (In Millions):
Operating Revenue $57.6 $40.7
------------------ ----------------
Operating Expenses
Product Purchases 32.5 21.4
Operations and Maintenance 10.9 10.4
Depreciation and Amortization 3.9 3.6
Taxes Other Than Income 0.7 0.5
------------------ ----------------
Total Operating Expenses 48.0 35.9
------------------ ----------------
Operating Income 9.6 4.8
Interest Expense, Net (0.1) (0.1)
Other Income (Expense) 0.2 0.0
Equity Earnings from Investments 4.0 5.9
------------------ ----------------
Income Before Income Taxes 13.7 10.6
Income Taxes 0.0 0.0
------------------ ----------------
Net Income 13.7 10.6
================== ================
EBITDA (1) $17.7 $14.3
================== ================
Distributions Received from Equity Investments $1.2 $5.7
================== ================
RECONCILIATION OF EBITDA TO NET INCOME
EBITDA (1) $17.7 $14.3
Interest Expense, Net (0.1) (0.1)
Depreciation and Amortization (3.9) (3.6)
Income taxes 0.0 0.0
------------------ ----------------
Net Income $13.7 $10.6
================== ================
NORTHERN BORDER PARTNERS, L.P.
SUMMARY SEGMENT INFORMATION
---------------------------
(Unaudited)
FIRST QUARTER
2005 2004
------------------ ----------------
COAL SLURRY PIPELINE SEGMENT
Operating Results:
Tons of Coal Shipped (In Thousands) 1,282 1,154
Financial Results (In Millions):
Operating Revenue $6.2 $5.4
------------------ ----------------
Operating Expenses
Operations and Maintenance 4.0 3.2
Depreciation and Amortization 1.0 1.3
Taxes Other Than Income 0.3 0.2
------------------ ----------------
Total Operating Expenses 5.3 4.7
------------------ ----------------
Operating Income 0.9 0.7
Other Income 0.0 0.0
------------------ ----------------
Income Before Income Taxes 0.9 0.7
Income Taxes 0.2 0.0
------------------ ----------------
Net Income $0.7 $0.7
================== ================
EBITDA (1) $1.9 $2.0
================== ================
RECONCILIATION OF EBITDA TO NET INCOME
EBITDA (1) $1.9 $2.0
Depreciation and Amortization (1.0) (1.3)
Income taxes (0.2) 0.0
------------------ ----------------
Net Income $0.7 $0.7
================== ================
NORTHERN BORDER PARTNERS, L.P.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
---------------------------------------------
(Unaudited: In Millions Except Per Unit Amounts)
RECONCILIATION OF EBITDA TO NET INCOME - PROJECTED 2005
Projected 2005
------------------------------------
Low High
------------------ ----------------
EBITDA $337 $347
Minority Interest ($40) ($44)
Interest Expense, Net ($84) ($86)
Depreciation and Amortization Expense ($86) ($88)
Income Taxes ($2) ($4)
================== ================
Net Income* $122 $126
================== ================
*The reconciliation of EBITDA and Net Income does not total due to use of ranges
for the various components of the reconciliation.
RECONCILIATION OF EBITDA TO DISTRIBUTABLE CASH FLOW - PROJECTED 2005
Projected 2005
------------------------------------
Low High
------------------ ----------------
EBITDA (from above) $337 $347
Interest Expense, Net ($84) ($86)
Maintenance Capital ($36) ($39)
Distributions to Minority Interest ($54) ($56)
Other ($2) ($3)
================== ================
Distributable Cash Flow** $164 $168
================== ================
Distributable Cash Flow per Unit $3.29 $3.39
================== ================
**The reconciliation of EBITDA and Distributable Cash Flow does not total due to
use of ranges for the various components of the reconciliation.