TLP - Earnings call transcript Q3 2017 | Transmontaigne Partners L.P.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to the TransMontaigne Partners Third Quarter 2017 Conference Call.

As a reminder, today’s call is being recorded. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. I would now like to turn the call over to Mr. and TransMontaigne Counsel General Hammell, Secretary Partners. of Michael go ahead, sir. Please

Michael Hammell

our covered like Safe for differ Company’s and cause call. today would by our these are referring forward-looking that include to from of thank website be should will Factors are transmontaignepartners.com Christine, these that that Report could by joining slide Act. To remind presentation undertake to the SEC you, I during Risk made XX-K. We filings, update on to results the statements earnings of may Thanks, be obligation of revise the the available any and Partners the the materially the everyone Reform as the Form Securities in us management listeners TransMontaigne required on begin, today’s section to Litigation expectations Presentations actual that predictions Investor these statements provisions that no or except Partnership’s is on considered call factors to at or law. page. statements, on Annual be statements forward-looking this our under Important forward-looking Please advised Harbor call including be the disclosed

morning, this Finally, on to financial certain non-GAAP may the call we refer measures.

of Mr. over please TransMontaigne of With non-GAAP that, call now Chief comparable refer For I’d or the directly reconciliation the Boutin, measure, these to website. Company’s to to Executive to financial Partners. release GAAP most the to our earnings Fred like Officer turn

Fred Boutin

Chief and Commercial Huff, today is Also of thank Financial for our us. call me morning, Operations. with on and everyone, you, Fuller, Mark Head the our Officer and Good you Michael. Thank President Rob joining

X.X by quarter extremely up by third year, Compared flow EBITDA to grew XXXX, distributable times. revenue last X%, and distribution continued of increased to XX%. of coverage business quarter of well achieving third the of the and cash revenue attractive quarter record another perform XX%, Our during was

million with barrel the service increase X X% project, last for completed was quarter along consecutive X.XXX third This we of our base fully placed I the growth phases distribution previous our overall. distribution strength consecutive which in third expansion $X.XXX business, an increases, over the of which our over and Collins X.X% Our year, Phase of and year. of the quarterly into increase throughout and quarter third quarter eighth quarter, the of distribution represents of the supported

of portfolio business, unitholders stable, Our ability and the continued of to a our contracts. accelerated underpinned of our assets created is rate by backed strategic base distribution provide by to this fee-based by strength growth stability long-term,

into agreement were both which located include truck of product the American of executed range we The have a in at entered one addition flexibility had for in outlets conducted and already is complex the Also, Francisco own business type Bay Richmond, All and to these very is tanks. same terminals America, In deepwater week, the facilities. same California. that manner with San conduct crude market operate North Francisco oil our terminals operate acquire assets near in an today. including of these to greater diverse a to that are and in with Plains further high are in one These XX the assets storage complex, docks, exactly refining and connected business. we Bay and are one terminals San Pipeline, to and Martinez and pipelines, rail waterborne largest we refine quality racks, that we two These we in the terminals refining we long-term. what scale the Last strong on platform we combined over have and to-date growth announce today, excited

initial with to enhances our third-party contracted fee and of of products The basis capacity liquid up footprint of five storage acquisition own geographic these will leading position to is these companies Specifically, new in one expansion a capacity. of the XX terminals petroleum our represent expansion XX total, on long-term strategic contract as terminals refined approximately an approximately of terms customers years. the and terminals, XX%. In million barrels of million to application with We States. United two X.X currently we’ll operate add that barrels a

XXXX. two expect We’re which million, be, our times them we for terminals XX $XXX what requiring from EBITDA than is to less these in

the importance seen on have the ultimately terms senior this secured credit unitholders. facility conservative the and Partnership’s fund our our us conditions we the be position, the capital which and were This a finance with the that conducive that capacity balance in would best value this cash with to existing stores. of interest may of sheet announcement from flexibility determine that planned equity emphasizes acquisition, transaction other equity portion to really for available afforded of conjunction and You we in but transaction with market not the have the offering of an

for We today and will partner work evaluate. minute. with XXXX details that their were for, Oregon. to we with that growth in joint Seattle, that venture he partnership with expect of quarter, ownership Huff formed in JV The review be the continue Services LLC, completed the the will right-of-first-offer BP around in we Coast us interest and we is and of these include affiliate general to a thereafter. pleased Portland, we our is is in This announce that will which Washington; had all one agreement West two terminals. products an ArcLight Last opportunity with refined to respect assets January these they assets TLP in attractive acquisition affiliate one Management of operator Mark into one a an entered to Products. shortly the a X be terminals, greater or in

venture announce Seattle they in interest The our related West joint south pleased Oregon. is an a have it a With major in on opportunity Olympic into the ArcLight entered pipeline relationship BP and clear in pipeline that, quarter, with I’ll to cooperative interstate is Products, valuable right-of-first-offer ArcLight. products to turn to ownership formed Pipeline. little Mark moves that have that I’m Washington detail. between a their Olympic to and from with Portland, recently the exciting is the and several This more refineries and cover ownership TLP acquisition example TLP for we in second regard over to of Coast with an State to the northern to This

Mark Huff

four, Thanks, and presentation six include the the are from information acquiring regarding of Plains. Fred. the we terminals that Pages five

consists of total The barrels Martinez the approximately the that storage Bay refining is from facility There and connections. we the refined storage users. strategic, wide of aggregate system. The mentioned, origination facility complex inland companies, and and multiple of system Martinez the Richmond Francisco include the the the Terminal product and refined Nevada products of pipeline deepwater products pipeline represent feed capacity, are and pipeline station. highly and Refined portion location to Martinez a close X.X and pipeline products pipeline the storage a dock companies terminals and to the to station barrels and to Terminal. end of Terminal and storage. of X.X Western Martinez Martinez California in barrels tanks in uniquely facility markets Fred tanks, only refiners including XX products two products no Northern the total acquiring receive or spot of the As provides X.X in Morgan This million the Sacramento of deepwater these the capacity. the capacity at a million storage customers Kinder consists capability million Reno. facility capacity multiple totaling pipeline, terminals crude dock Morgan’s supplies Together, Area logistical The Bay facility of refiners, oil has to including is and facility’s oil local available San a proximity integrated XX of XX% storage at is conquered refined available via Martinez terminal. with Kinder trading located

pipeline-supplied positioned local crude storage the is crude has of advantage they million services Customers at decline the Martinez in at area. and is evolving primarily supply. by as tankage oil in oil the take local the connections, include deepwater production crude Because to waterborne California local the providing continues of of replaced the to market, well-positioned to Martinez crude the and slate On barrels and also also refineries. side, storage local facility dock uniquely X refiners

are in the users is we Francisco acquiring facility barrels Harbor the a facility into for near Inner second Richmond refinery. of destination storage Chevron’s market. Richmond The San primary Harbor The of located consists to the Richmond waterborne Terminal, products storage. which liquid end product XXX,XXX delivering Inner is greater is This Richmond

truck renewable aviation product and marine a to and facility Terminal at has customers. terminal and you. the capacity users. significant end over fuel. addition rack customers for providing service fee-based at the diesel, international refiners, point, distillates backed suppliers, rail deepwater the storage full I’ll is turn by ethanol flexibility company, its biofuels, contract biofuels includes and and dock, local and facilities, including it pipeline, ethanol Rob, refiner to trading Today, and and this and to Product also Richmond fuels In

Rob Fuller

the $XX.X the reported million, than Thank million you, of of financial Mark. third the which cover I’m XXXX. third $X.X third to Revenue was quarter. the performance for $XX.X XXXX going our quarter we totaled for quarter in higher million

third quarter was compared by the was fully contributions projects Phase revenue. year-ago on the Our driven coming I to strong for from growth Collins performance quarter our

million revenue quarter contribution capacity. third of Our Collins included approximately the from new $X tank

of increased X.X capacity of second barrels at of at this liquid by quarter first million year. project storage. benefit barrels barrels X came was of third Collins total I Phase our The in quarter which the online to expanded million the Completion Collins, our capacity quarter Collins/Purvis expansion X.X our complex we realized from full which for million terminal the fully

prior service of re-contract quarter, approximately was our existing flows and generated third contract from into year firm, the in our the durability commitments, capacity For and terminal XX% by capacity we progression enter terminals. approximately the at up cash our reflecting terminaling as new expanded of quality our in further for XX% period, agreements revenue

contract quarter, over of services Direct $XX.X of attractive portfolio last firm operating for the expenses years. the the revenues three Our totaled more $XXX,XXX terminaling with generated of quarter of remaining approximately remains or year. commitments for our XX% quarter, increase an third million with from contracts third

Earnings the revenue. of approximately direct year than year. Our totaled third to increase to operating in timing project, the approved about million Omnibus and in has a by earnings growth higher fees attributable increase and on taxes third offsetting quarter. the over with $X.X butane $XXX,XXX for Harvey as prior back related discussed and which approximately repairs at $X.X from Florida agreement standpoint, and projects a administrative essentially expenses BOSTCO costs May related year of tankage. $XXX,XXX BOSTCO result approximately due the previous Harvey year’s associated which the days I being $XXX,XXX General down Irma. quarter of due Phase a related Collins million amounts for in been $X.X calls. affiliates Environmental new The Property the the for prior were year our Phase and from were than included by taxes expenses was to was million timing Conflicts the spend. unconsolidated Hurricane off-revenue approximately and Other period, which were the $X.X more Committee of increased the totaled of quarter, terminals decrease less prior to few administrative remediation approximately $XXX,XXX hurricanes on third was structural some our million, $XXX,XXX maintenance in for disclosed to prior our project of from increased an during an and under is increase are spend to sales million I by unharmed Collins approximately quarter this $X.X purchases expenses BOSTCO. payable recognized of the increase costs annual which

and general compared partially increase related debt cash the totaled expect our approximately additional Remainder third what West Interest announced to increase of costs return expense year. the finance million increase to an be agreement a Coast for construction of quarter, has we to in expense high-teen with $X.X million last as on of is been million $XX $X.X the the third end prior $XX the year this associated this to project. Phase factored administrative at the of increase the in Collins I including is deal approximately the quarter The outstanding million attributable year’s quarter almost to facilities over to from to costs, acquire recently Importantly, in investment. Plains.

Additionally, the in our the in interest the XX the for third of months XX% for the of of third the XXXX. higher million third $XX.X million, EBITDA year’s reduced third $XXX approximately million amount. third swaps million the for on expense. is Consolidated to the million was compared we business. quarter prior consistent with totaled or over now $XX.X Distributable by million rate Maintenance trailing our $XX.X year, cash year’s for compared prior quarter $XX.X to we a a $XXX,XXX EBITDA little quarter XXXX. quarter $X.X gain approximately recorded CapEx the increase quarter quarter that had flow X% the an for reported interest for reported the prior was third quarter,

the of fourth increase rates an quarters of in be to the year in repairs with year’s amount fourth prior do and and in XXXX. recorded three compared experienced our Increases somewhat consistent first the quarter we the maintenance However, maintenance run as expense, our quarter. in CapEx this should expect

our As quarter earlier, to as October to per October we of the paid for unit. was Fred XXst September XXXX distribution mentioned by of $X.XXX on XXrd. distribution record ended XX, increased quarterly unitholders The $X.XXX

marks X% Our our paid rate X.X% also growth the sequentially above the represents in the quarter third in distribution third quarter increase prior-year distribution. eighth of consecutive and and

compared represented distribution of quarter million, coverage to third distributions $XXX We $XX.X which quarter resulted distribution exited times. of leverage trailing with approximately distributable the X.XX third EBITDA flow total cash Our XXXX to $XX.X XX-month this of borrowings remain us facility, provides times. of of balance of committed healthy cash million in and quarter a revolving credit flexibility. third maintaining of to X.XX sheet, debt million significant We which represented our on with total

of Facilities higher an well will facility feature what After stability we XXXX total likely Coast credit of operations million our and amounts. with leverage most of have have somewhat that acquisition, capacity. $XXX maintained credit ratio our The within West accordion a $XXX nature can facilities exercisable continue covenants. a support the provides our of March still our believe Given another in for than historically, of but line million flows, matures for cash business and we higher the leverage we to

had to As in and unused of the $XXX million. $XXX the the end the question turn my of approximately also $X.X $XXX million we cash under third for million approximately capacity of facility we quarter, million prepared for total up answers. remarks. existing you. now Christine the I’d to open to liquidity of Thank and lines almost completes That like call had back

you. be We Thank will conducting now [Operator a session. question-and-answer Instructions]

first Selman with question. Our the of comes with question from Please Akyol proceed Stifel. line your

Selman Akyol

Thank of morning for ones quick congratulations. you. and me. Couple Good

First terminals? terminals you of length, and to need of the capital all, sort then, maintenance through new might these go you expand contract average on these ability can

Mark Huff

contract but maintenance as Maintenance our some terms. one today Sure. This there between for we year what the range options -- five is multiple years; and as CapEx Contracts in line good system. extensions, we experience also Mark. in with is five on is one range, far a cases, contract is to CapEx

in So, expect changes any that we don’t regard.

has existing growth question, I out Richmond taking facility. and have far in at been permitting tanks of We for was for the customer actually a opportunities, second As is growth with look third part Selman. new tanks, tanks opportunities, That at. an and customer; a then, products your of They late think we’re Richmond the for that service tanks replacement do service that executed at Martinez were some underway. opportunity to immediate returning to some as of

Selman Akyol

to deal come G&A in it, back you of talked expecting we think I in increasing forward bit of that? as of go market should guys because you are sort we and much expense, cetera. should or to you about G&A et because now, are elevated expense little it we But, get a And then, the the more be expect

Rob Fuller

to based than rate have. elevated working think the that think say the to I this at a we this quarter think run will, the would were to it’s of I during quarter quarter. just on used on was reasonable have off things more on, be and wouldn’t I we expect and we that some But, that pretty I least

to same more that will I at be So we think will, we were at. looking -- don’t used going things think at be level to. then I But it we run we are the

Selman Akyol

And just yet? last one for me. guys line asked exercised Have feature already accordion on the you your to credit have of

Rob Fuller

that, But it done No, yet. so. we we have do well may haven’t not. very But we

Operator

you. Thank

end the question-and-answer session. And we of of set We call. have reached the the conclusion today’s

for a this disconnect may day. time. You and have participation, your lines Thank you wonderful at your

Transmontaigne Partners (TLP) 13 Nov 172017 Q3 Earnings call transcript