TLP - Earnings call transcript Q4 2017 | Transmontaigne Partners L.P.

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Operator

Greetings and welcome to the TransMontaigne Partners Fourth Quarter and Full Year 2017 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] And as a reminder, this conference is being recorded.

Now, I would now like to turn the call over to Mr. President. Vice Executive Hammell, Michael Thank you, go ahead. please

Michael Hammell

Act. that materially from you, our morning. differ today that provisions the on required statements, forward-looking and advised should the forward-looking this be Reform revise to our statements statements the Securities expectations our Factors call. undertake in by to thanks us may actual earlier as joining that our the Please except XX-K these call are that during could disclosed made are that to for we any on considered everyone statements the the predictions no of factors cause SEC Risk of this law. Important be results advised Partnership’s or we by be filed Thank Please Form Brenda, includes that TransMontaigne covered including obligation these forward-looking filings, conference Partners Harbor be Safe or Annual to section of Report update Litigation

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

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

Fred Boutin

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

revenue XXX.X XXXX. XXXX represented throughout revenue, and in or EBITDA business million our XXXX. flow performed during record over of achieved increase million Our XXXX. distributable We quarter a well $XX.X fourth XXXX and extremely an XX% the cash of And

our million increase and other XX% results on management of operating expansion. increase million XXXX. and the and $XX.X continued base of or of disciplined time maintenance EBITDA to XXXX our cash XX.X I Contributing over a business Phase of budget The million million from a cost. $XX.X strong distributable barrels XXXX on Collins record a performance assets represented completion the of flow these Our our were of XXXX X and represented our XXX.X XX%

supported last X% represents distribution while our $X.XXX previous year, was fourth a the $X.XX coverage the of maintaining times XXXX. our for distribution distribution X.X% of and quarter to of increase. of This quarter which growth per the and increase All increase in a a all over unit, quarterly fourth X.XX increase consecutive conservative quarterly $X.XXX fourth of consecutive ninth for this our distribution quarter over ratio

including these financed America The the exactly and $XXX North these our assets. assets times draw own we same XXXX of assets type operate these and less a that assets and are and one last into other Refining entered than our the acquisition These San in on crude long-term budgeted stable storage connections terminals unitholders December to contracts. we pipeline, Complex, facility. XX acquire the quality Area in distribution terminals to strategic was Bay XX but largest closed ability based approximately one On On located tanks. already are today. dock, our two waterborne the which asset of Martinez yet Francisco These Francisco completed and a San racks price high not underpinned growth and the call, supply is we credit strong Area have products Refining terminals range is rail. Our by in agreement oil Bay we the Complex million, for XXth, of discussed The include we by our to portfolio Richmond. in in our of deepwater of purchase diverse from truck fee backed had EBITDA refined with

we way capacity the terminals Importantly, of contracted at same these our been other terminals. contract the capacity has

years return a of high other the A generate of receiving in is began capacity from our new through these expected at five basis teens. to represents this revenue return as fee the opportunities agreements terminaling was also of an project long-term This the almost of with the is the ago, is placed capacity take-or-pay at teens. contract -- commitment in to a capacity of into entered leading system tankage storage the high Martinez. took beginning we The barrels this terminals the investment terminaling pursuing return up into a constructing couple both second the terminal. fourth to now the approximately $XX Richmond of acquisition already and U.S., We're capacity initial the million and terminals similar long-term assets high have the our agreement with XXXX. active agreement, and Pursuant into third-party new which in a million at $X aggregate enhances Specifically, terms the additional the number tank the cost of generated customers one capacity. services we construction million expand in our storage million new long-term diversification to which years. active liquid across footprint refer by our of capacity position we for in of X from Richmond We of with of entered be approximately we a quarter a as contracted as on companies Collins. expected States. about new to strategic and stages The I the customers was Collins Phase these of XXXX XX of geographic These barrels place expansion of barrels our million terminal, XXX,XXX our and XX%. We United XX terminaling to quarter two service, at have is of project commenced barrels capacity with expansion cost tank to

In capacity to permit With XXXX, barrels build and flexibility, improve II receive obtained Today, along and long-term, to the X simultaneously batches now entered that capacity has jet to terminal ability receive to support barrels. the the of excited fee an distillates segregated These we've Collins services air a recently million line we and gasoline bulk our We the we're improvements and delivery Purvis out. the Colonial into improvement to current including I of deliver adjacent share storage our active at Collins terminal or approximately Colonial increased expected of of the additional $XX ability will recently and our generate barrels Pipeline agreement construction anticipated XXX,XXX our rates of Phase of new of the these new an for cost for capacity land teens. segregated is connection. and purchased dedicated the Phase a a with fuel. the and approximately into in terminaling that rate, completion X.X result storage low storage capacity. expansion, with receipt upgrade our is at based and have significantly connection additional entered will deliver of return Pipeline to project an million The in this and full-line connection agreement million complex

to Phase and this We initial year expect of end complete begin QX this the fully project end XXXX. online by the be come of by II to

customers active in and this at initial capacity are II regarding Collin. perspective build with future currently Phase to addition other several incremental discussions we out, In existing

barrels II. will with returns Phase a more Phase be the expect out at the improvements XXX,XXX with future I We Collin connection return completed in build from to consistent since be

As for centers products capable primary is a storage terminal the mechanism is a refined bulk Colonial Mid-Atlantic to Plantation Gulf reminder, and the the market only is U.S. between terminal Collins throughout from from receiving our regions products refined for the drilling strategically delivering located to which population system, independent and transferring refinery of the and of and delivering Southeast transporting and Coast

actionable expect have we to next Brownsville in are able opportunities growth several be discuss and near-term further that call. on we Finally, to our pursuing

generate at the times facilities distribution our completed par indebtedness per is significantly senior an our side, We to expect while our projects Net calculated was performance last facility grew acquisition that credit of in $XXX and X.X% increase to proceeds repay the XXXX facility. notes as terminals. notes the to of our financial these accordance in will the of year unit with of environmentally X% Coast record develop we achieved base, our manner. were TransMontaigne. X.XX covenant all and includes unsecured asset safe credit for On After West X% and terminals, from used our leverage incredible month, growth responsible years. EBITDA, ratio EBITDA under operate leverage million ratio our financing eight in sale provide by the maturing we to from in the accretive further a continuing

helped to fourth dedicated now call the to express quarter. have been possible not And our Rob would happen. review at I TransMontaigne this everyone financial to that our this appreciation of turn employee. who sincere for to performance want my hardworking All will make the over I’ll and without

Rob Fuller

Thank the we totaled you, XX.X of than quarter XX% reported the fourth XXXX million in Fred. higher for $XX.X the XXXX. million, Revenue which of fourth quarter was

the performance approximately a XXXX. I quarter was quarter to as revenue of during from Our contributions $X quarter fourth tank Fourth contribution year on coming million Phase compared capacity. project by Collins ago strong growth included from the driven for Collins fully the new revenue

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

our was For This the terminals. service capacity the progression into our agreements from of firmly for new revenue flows quality committed is our durability the terminal up cash expanded XX% approximately as year, existing and capacity our at in terminaling XX% approximately reflecting in further re-contract and fourth enter generated from prior question of we take-or-pay contracts.

of take-or-pay period. pipeline a are our actual sources fees, $XXX,XXX types and backed with fees less from product of as agreement volume the management cash these Coast rental services. and to such from committed which This of from volumes even generated million attributable we Historically, generated the because terminaling million payment standpoint throughput shift been three a with of our generated to BOSTCO in contracts approximately result at fixed contractual of highly the for requirements the decrease fully customer, underpins received flow. Driving base expenses committed OpEx event remains in minimum totaled through TransMontaigne was month, from Our XX% revenue of recognized the in firm a of Both costs remaining $X.X the or by to like further of minimum facilities, facility fourth the $XXX,XXX firmly to our attributable earnings West acquisition that fees the base of higher storage amount affiliates or decrease Direct either remains completed last ancillary decrease of the from which agreements fourth to prior contracted our quarter to briefly of customers as agreements. minimum over revenues pleased off those contract stability of monthly by primarily everyone is which XXXX throughput with fourth again terminaling cash these terminaling fully requirements a our contract, revenues these share attractive the that approximately and our flows $XXX,XXX, redredging operating year's portfolio like a decrease for lower. from was for expand of These of base Harvey. down throughout revenue terminaling our and years. firmly approximately quarter agreements our services a of ratable XX% provide was this sources, XX of including from costs, to were totaled today. for from year. remind to BOSTCO facility, committed quarter maintenance our the hurricane XXXX. Earnings at the with have payment, fourth quarter, commitments repairs were of I'd usually $XX.X during much the beginning services about We the more of of revenues unconsolidated related our contain quarter. From predictable than remaining make revenues

associated on administrative and unharmed as approximately As expenses impacted the year BOSTCO our with Harvey discussed $X Collins to mentioned quarter, the growth under summer. the prior this $X.X fees third the General annual Irma, and Florida increase XXX,XXX project an over have $X.X was Omnibus which quarter by million calls. previous About payable our million agreement and period. the of increase related region Phase for structurally of hurricanes over in million call were Gulf left Coast we in the the administrative I totaled our terminals the

West doubled per $X an of million and attributable approximately I rate quarter, to our Coast costs West is I the million Coast high in in increase the remainder fourth LIBOT to than acquisition expense this Collins our year. G&A in terminals. has $XX XXXX increase component return of and and totaled of expansion quarter last of increase opportunities, associated XXXX. on expense have $X.X associated pursuit $X.X debt of the increase the December increases totaled for the The terminal for all approximately million quarter our fourth fourth into million factored acquisition largest over which in was driven with increase by the an Phase related Phase teen quarter our These cash The which Interest million the been for more Collins acquisition. onetime costs and Importantly, include with of investment. $X.X

of XX quarter the interest fourth a was year's year, recorded the quarter expense. XX% full XXXX. $XXX,XXX the XXX.X approximately our of the for representing reduced This X.X% that $XX EBITDA million. quarter amounts. months rate from we on prior trailing Consolidated the we a interest compared of approximately million increase represents XX.X in fourth was increase fourth the swap an had XXXX gain Additionally, reported year in million prior for to EBITDA

quarter of Importantly, our to which the the beyond. this terminals forma excludes West of the amounts results XXXX benefit related Coast beginning in pro and acquisition first financial will our

$XX.X from terminals a times than XX reminder reflect totaled flows flow on assets. of our $XX.X $XXX the of consistent less quarter which acquisition expectation EBITDA with multiple cash $X for of reported these fourth for X.X Distributable Maintenance year million the the a spend for the less million million quarter CapEx was XXXX million for cash XXXX As all maintenance quarter capital than amount, XXXX. of the in quarter the million approximately fourth with XXXX. prior was fourth spend consistent is

As quarterly Fred December our to the unit. by for XXXX, increased quarter $X.XXX ended mentioned distribution earlier, we per XX, $X.XX

cash approximately $XX.X distribution million total flow represented total $XX.X distribution coverage cash million, disapproval resulted X.XX quarter distributions fourth compared times. in Our of to which of of

distribution million of distributable flows and $XX.X XXXX, of times the distributed a leaving cushion was cushion coverage X.X generated $XX.X all than times XXXX or XXXX is cushion For borrowings X.XX fourth distribution distribution quarterly us within and by unit The we is cash even greater facility of raising approximately times, $XX.X that our X.XX fourth per million of or XXXX million approximately with covenants million. which times, We our leverage of X.X to revolving with finished representing XX the EBITDA still year-over-year. times. X.XX of X.X% the of quarter $XXX.X on quarter of trailing debt million credit bank well of $XX.X month

higher February we end adequately amount. in West operations of leverage forma it to line we While XX our statements the our what approximately cash the has terminals the annual as somewhat EBITDA higher our we commentary Coast the our leverage of relation for credit terminals given been than the the of of is in of this the leverage more filed bank with million acquiring flows, pro XX at XXXX, approved times EBITDA of of less acquisition previous the financial ratio our ratio Coast nature audited recently factored calculating, believe than support in which annual assets can that stability and and the year. consistent business West with that In of is

to in of XXX in early to six acquisition, February par with into our use from million from high XXXX coupon. debt. eight credit we entry down XXX senior notes yield we and The pay the issuance our notes a XXX XXXX Our million. the in December Coast March this a credit terminals we made in of issued at West with represented the and offering facility to Then year, decision of the initial and facility facility million the upsize proceeds matures market connection

of currently currently operator and turn my for is the that future issuance open to Brenda we million including to That credit our will the back recent identified and $XX have growth been answers. lines the growth prepared capacity the notes, up for facility I construction. remarks. to approved questions unused opportunities concludes of now With finance under it

Operator

question gentlemen. take Instructions] and first with the line ladies your Wolff you, Thank [Operator our Please from we’ll go of And Eric ahead Ridge Partners. with Hawk question.

Eric Wolff

times I closer you higher times forma you to distribution cover were Is Collins annualize deal include if Purvis, if I X.XX in make the that just if X.X want pro than directionally, looks obviously It then little actually about bit pro you your what and substantially the interest is coverage the the have complicated. costs of your kind forma kind statement and also pro expense -- or a coverage comment like right understood which annualize acquisition for I your they and other forma I of annualize here. versus reported and reported can that’s things? that just sure

Fred Boutin

it. you’re follow the makes think tips, reporting that I but it sense that Yes, what what is I on number we’re finger I be, because might but my it of at don’t would history it be doing. have higher

So right. it's probably

Eric Wolff

And of drawing here on the distribution from appropriate in longer coverage on ratios of thinking any your update the and terms kind term?

Fred Boutin

still got certainly considerable I a Well to for have of $X.XXX conservative fairway coverage. very rate, if the raise to choose think and the distribution to the we that distribution period continue we at time

we higher probably something target certainly markets times probably But be into right the that really down what we occasionally. assets, by as to in is, bring what really the quarter X.XX it think by target the decision never long-term needs But the can that on changes to on at far may probably a stability do and a or the than basis. the and with that's or given that is we the changes a little to do potential of bit. on appropriate distribution something as our view diversity So, that that quarter is board

Eric Wolff

paid some what real and not the of you're of in In question in HOTCO with for valuation the quick. clearly thoughts the group for I light that mean potentially, on context stock last [indiscernible]? acquisition that BOSTCO And of they Any getting the value that.

Fred Boutin

value comp what that think of I translates directly is. or for not is that a the BOSTCO BOSTCO Yes, that whether to

some hard it's ways facility. They've it's but but facility that the they're HOTCO think BOSTCO your what money, BOSTCO better yes, good got to money a know worth as I that's than I for You changed lot would and bit, say a point think bigger they over so know. a -- actually HOTCO bigger it's I of a BOSTCO, That's in a a lot doing point. if little of

Operator

next from Please question Our Schaefer Schafer Instructions] go the line question. ahead with [Operator comes Jeff of your Financials. with

Jeff Schaefer

you and obviously, point if of becoming wondered could just obviously away the little the a material as where a General opportunities. your growth that decision that's we're that's talk from I the a Guys IVRs move but about IDRs board, think industry at wide involves and look bit at and Partner you

thought this in And at the point? change so I'm any wondering, any if about there's structure

Fred Boutin

focused other frequently that to unitholders point. at that we that’s Yes, unitholders that certainly and question we this be a have aren't and get really on that seem

IDRs. already done seems of more And a pushing the made you simplification towards is agree the really top to TransMontaigne. midsized and out side, down is so it’s companies with on agree the a of so, it is market have have owner. down it I be and also you trend decision elimination cap be It by bigger where to there companies, that will From there a perspective I the smaller with that

that and say of is aware all sense So, the secret some about on that's so it. if that's is makes at owner that and to I a that not But down do point wants the go can future then really and in everybody it what we'll path.

Jeff Schaefer

that you the one guys we the haven't just levels consider now, your times for you the to you of think on guideline, what's covenant you're seen acquisition think really those if you spots What what what And sense? Coast but on within question prudent guys. up pushed follow but the obviously well -- makes not X.XX debt covenants, bank then levels, internal West do guys debt

Rob Fuller

Yes, is sure this Rob.

longer-term, the around it's think, times. probably I over right four

Jeff Schaefer

Okay.

Rob Fuller

our to manageable order where will we those say believe I that is it's execute which a our But the very projects, currently point, growth will ability identified leverage very not complete always beholden at in we're hinder is to accretive and on market. equity projects our and not to focal

Operator

a is callers or we will the of This call by session, XXXX. be be available and XX, passcode have XXX-XXX-XXXX, for today's our teleconference. the until end March XXX-XXX-XXXX The Thank question-and-answer reached be replay the replay shortly accessed and and international after does you, conclude dialing can will available XXXXXXXX.

your disconnect this thank participation. may You at for and time you lines your

Michael Hammell	EVP
Fred Boutin	CEO
Rob Fuller	CFO
Mark Huff	President and Head of Commercial Operations
Eric Wolff	Hawk Ridge Partners
Jeff Schaefer	Schafer Financials

Transmontaigne Partners (TLP) 15 Mar 182017 Q4 Earnings call transcript