Expects Cash Distributions for 2015 of
Approximately $2.00 per Unit
Rentech Nitrogen Partners, L.P. (NYSE:RNF) today announced
financial and operating results for the three and six months ended
June 30, 2015. The partnership also announced a cash distribution
of $1.00 per unit for the second quarter of 2015.
Keith Forman, CEO of Rentech Nitrogen, said, “Our second quarter
results exceeded our expectations. Favorable weather at the
beginning of the spring application period resulted in strong
demand for ammonia and ammonium sulfate. In addition, I’m pleased
to see the Pasadena facility generate another quarter of positive
EBITDA. We are well on our way to generating EBITDA in the range of
$10 million at Pasadena this year.”
Mr. Forman continued, “We are forecasting 2015 to be our second
best year since going public, with cash distributions for the year
of approximately $2.00 per unit and consolidated EBITDA of about
$118 million.”
Mr. Forman added, “We are excited about the merger with CVR
Partners that was announced yesterday, and we continue our process
to sell the Pasadena facility separately.”
Three Months Ended June 30,
2015
Revenues for the second quarter of 2015 were $109.9 million,
compared to $113.6 million in 2014. Gross profit for the
second quarter of 2015 was $44.7 million, compared to
$28.2 million for the same period last year. Adjusted EBITDA
for the second quarter of 2015 was $47.7 million,
compared to $30.7 million in the corresponding 2014 period. A
further explanation of Adjusted EBITDA, a non-GAAP financial
measure, as used here and throughout this press release appears
below.
During the second quarter of 2015, Rentech Nitrogen recorded an
asset impairment charge of $101.8 million for the Pasadena
Facility, due to our conclusion that our process to evaluate
strategic alternatives and the announced agreement with CVR
Partners made it more likely than not that the facility would be
sold or otherwise disposed of before the end of its previously
estimated useful life. This conclusion requires that the estimate
of future cash flows used to calculate the fair value of the
facility must include estimated sale proceeds and interim cash
flows leading up to the sale.
Net loss for the second quarter of 2015 was $(66.2)
million, or a loss of $(1.70) per basic unit. This compares to
net loss of $(8.9) million, or a loss of $(0.23) per basic
unit, for the prior year period. Net income was $35.6 million,
or $0.92 per unit, for the quarter ended June 30, 2015, excluding
the loss due to the Pasadena asset impairment. This compares
to net income $18.3 million, or $0.47 per unit, for the prior
year period, excluding an impairment to Pasadena goodwill.
East Dubuque Facility
Revenues for the second quarter of 2015 were $72.1
million, compared to $73.9 million for the same period
last year. The decrease was primarily due to lower sales volumes
and prices for UAN, partially offset by higher sales volumes and
prices for ammonia.
Ammonia deliveries increased due to strong demand from
agricultural and industrial customers leading into the spring
planting season. Volumes were low in 2014 because production was
interrupted by a planned turnaround and a fire in the fourth
quarter of 2013. Volumes were also higher in 2015 as a result of
operating at expanded rates following the completion of the ammonia
capacity expansion. UAN deliveries decreased due to greater demand
for ammonia and lower priced urea, and wet conditions during the
UAN application period.
Average sales prices per ton for the second quarter of
2015 were 6% higher for ammonia and 7% lower for UAN, as
compared with the same period last year. These two products
comprised 88% of our East Dubuque Facility’s revenues for the
second quarter of 2015 and 88% for the same period in the prior
year. The increase in ammonia prices is due primarily to an
increase in demand due to ideal conditions for applying ammonia.
The decrease in UAN prices is due primarily to lower demand for
UAN.
Gross profit was $42.7 million for the second quarter
of 2015; this compares to $33.0 million for the same period
last year. Gross profit margin for the second quarter of
2014 was 59%, compared to 45% for the same period last year.
The increases in gross profit and gross margin were primarily due
to higher sales volumes and prices for ammonia, business
interruption insurance proceeds of $4.4 million related to the 2013
fire and unrealized gains on natural gas derivatives, partially
offset by lower sales volumes and prices for UAN. Gross profit
margin, without business interruption insurance proceeds and
natural gas derivatives, was 51% for the second quarter of 2015,
compared to 45%, without natural gas derivatives, for the same
period in the prior year.
Adjusted EBITDA for the second quarter of 2015 was $46.6
million, compared to $36.8 million in the corresponding period
in 2014.
Net income was $41.2 million for the second quarter of
2015, compared to $31.6 million for the same period last
year.
Pasadena Facility
Revenues for the second quarter of 2015 were $37.8
million, compared to $39.7 million for the same period
last year. The decrease was due to lower sales volumes for ammonium
sulfate and ammonium thiosulfate, and lower sales prices for
sulfuric acid, partially offset by higher sales prices for ammonium
sulfate and ammonium thiosulfate, and higher sales volumes for
sulfuric acid.
Average sales prices per ton increased for ammonium sulfate by
35% and decreased by 12% for sulfuric acid for the second quarter
of 2015, as compared with the same period last year. These two
products comprised 91% of our Pasadena Facility’s revenues for the
second quarter of 2015 and 93% for the same period in the prior
year. Ammonium sulfate sales prices increased due to a higher
percentage of sales in the domestic market; continued demand for
ammonium sulfate as retailers move away from ammonium nitrate; and
production issues at other North American facilities. As part of
our restructuring plan, we reduced our historically low-margin
sales to Brazil. No ammonium sulfate sales were made to Brazil
during the second quarter of 2015, while 36% of ammonium sulfate
sales were to Brazil during the second quarter of 2014.
The higher sales volumes for sulfuric acid and lower sales
volumes for ammonium sulfate were the result of our restructuring
plan implemented in late 2014. In addition to reducing sales to
Brazil, the restructuring plan included reducing expected annual
production of ammonium sulfate by approximately 25%, to 500,000
tons. Sulfuric acid is a component in the production of ammonium
sulfate. With reduced production of ammonium sulfate, less sulfuric
acid is needed, which results in more sulfuric acid being available
for sale.
During the second quarter of 2015, the sulfuric acid plant
operated at reduced rates, due to a crack on the boiler exit duct.
The crack was repaired during planned downtime in July 2015, and
the sulfuric acid plant has subsequently operated at full
rates.
Gross profit was $2.0 million for the second quarter
of 2015, compared to a gross loss of $(4.7) million for
the same period last year. Gross profit margin for the second
quarter of 2015 was 5% compared to a gross loss margin of
(12%) for the same period last year. The increases in gross profit
and gross profit margins were primarily due to higher sales prices
for ammonium sulfate and ammonium thiosulfate, higher sales volumes
for sulfuric acid, lower operating costs due to the restructuring
and a decrease in the write down of inventories.
Adjusted EBITDA for the second quarter of 2015 was $3.4
million, compared to an Adjusted EBITDA loss of $(3.8)
million in the corresponding period in 2014.
The Pasadena Facility incurred an asset impairment charge of
$101.8 million in the second quarter of 2015. The impairment
reduced property, plant and equipment by $81.3 million and
eliminated intangible assets by $20.5 million. In the corresponding
period last year, the facility incurred a goodwill impairment of
$27.2 million, which eliminated all the remaining goodwill
associated with the facility.
Net loss was $(99.5) million for the second quarter
2015, compared to a net loss of $(33.5) million for the
same period last year. Net income was $2.2 million for the
second quarter of 2015, excluding the loss due to the asset
impairment. This compares to a net loss of $(6.3) million, for
the prior year period, excluding the goodwill impairment.
Six Months Ended June 30,
2015
Revenues for the six months ended June 30,
2015 were $179.0 million, compared to $169.9
million for the prior year period. Gross profit for the six
months ended June 30, 2015 was $63.5 million, compared
to $42.0 million in the prior year period. Adjusted EBITDA for
the six months ended June 30, 2015 was $66.8 million,
compared to $42.2 million for the prior year period.
During the six months ended June 30, 2015, Rentech Nitrogen
recorded an asset impairment charge of $101.8 million for the
Pasadena Facility, due to our conclusion that our process to
evaluate strategic alternatives and the announced agreement with
CVR Partners made it more likely than not that the facility would
be sold or otherwise disposed of before the end of its previously
estimated useful life. This conclusion requires that the estimate
of future cash flows used to calculate the fair value of the
facility must include estimated sale proceeds and interim cash
flows leading up to the sale.
Net loss for the six months ended June 30,
2015 was $(57.3) million, or $(1.47) per unit. This
compares to a net loss of $(5.8) million, or $(0.15) per basic
unit, for the prior year period. Net income was $44.5 million,
or $1.15 per unit, for the six months ended June 30, 2015,
excluding the Pasadena asset impairment. This compares
to $21.4 million, or $0.55 per unit, for the prior year
period, excluding an impairment to Pasadena goodwill.
East Dubuque Facility
Revenues for the six months ended June 30, 2015 were $108.8
million, compared to $102.4 million for the same period last year.
The increase was primarily due to higher sales volumes and prices
for ammonia, partially offset by lower sales volumes and prices for
UAN, and lower natural gas sales.
Average sales prices per ton for the six months ended June 30,
2015 were 3% higher for ammonia and 5% lower for UAN, compared with
the same period last year. These two products comprised 85% of our
East Dubuque Facility’s revenues for the six months ended June 30,
2015 and 80% for the same period last year.
Gross profit was $60.1 million for the six months ended June 30,
2015, compared to $45.4 million for the same period last year.
Gross profit margin was 55% for the six months ended June 30, 2015,
compared to 44% for the prior year period. The increases in gross
profit and gross margin were primarily due to higher sales volumes
and prices for ammonia, business interruption insurance proceeds of
$4.4 million and unrealized gains on natural gas derivatives,
partially offset by lower sales volumes and prices for UAN. Gross
profit margin, without business interruption insurance proceeds and
natural gas derivatives, was 47% for the six months ended June 30,
2015, compared to 45%, without natural gas derivatives, for the
same period in the prior year.
Adjusted EBITDA for the six months ended June 30, 2015 was $65.9
million, compared to $50.2 million for the prior year period.
Net income was $57.2 million for the six months ended June 30,
2015, compared to $42.8 million for the prior year period.
Pasadena Facility
Revenues for the six months ended June 30, 2015 were $70.2
million, compared to $67.5 million for the same period last year.
The increase was due to higher sales prices for ammonium sulfate
and ammonium thiosulfate, and higher sales volumes for sulfuric
acid, partially offset by lower sales volumes for ammonium sulfate
and ammonium thiosulfate, and lower sales prices for sulfuric
acid.
Average sales prices per ton increased by 32% for ammonium
sulfate and decreased by 5% for sulfuric acid for the six months
ended June 30, 2015, compared to the same period last year. These
two products comprised 90% of revenues for the six months June 30,
2015 and 89% for the same period last year.
Gross profit was $3.4 million for the six months ended June 30,
2015, compared to gross loss of $(3.4) million for the same period
last year. Gross margin for the six months ended June 30, 2015 was
5%, compared to gross loss margin of (5%) for the same period last
year. The increases in gross profit and gross profit margins were
primarily due to higher sales prices for ammonium sulfate and
ammonium thiosulfate, higher sales volumes for sulfuric acid, a
decrease in operating costs due to the restructuring and a decrease
in the write down of inventories.
Adjusted EBITDA was $5.4 million for the six months ended June
30, 2015, compared to an Adjusted EBITDA loss of $(3.5) million for
the same period last year.
The Pasadena Facility incurred an asset impairment charge of
$101.8 million for the six months ended June 30, 2015. The
impairment reduced property, plant and equipment by $81.3 million
and eliminated intangible assets by $20.5 million. In the
corresponding period last year, the facility incurred a goodwill
impairment of $27.2 million, which eliminated all the remaining
goodwill associated with the facility.
Net loss was $(99.4) million for the six months ended June 30,
2015, compared to a net loss of $(34.3) million in 2014. Net income
was $2.4 million for the six months ended June 30, 2015,
excluding the loss due to the asset impairment. This compares
to a net loss of $(7.1) million, for the six months ended June
30, 2014, excluding the goodwill impairment.
Outlook
Third Quarter 2015
Guidance
Rentech Nitrogen expects results for the third quarter of 2015
to be seasonally low. The partnership provided the following
forecast for product deliveries, consumption of inputs and capital
expenditures for the third quarter of 2015.
3Q15 Forecasted Deliveries (in
thousand tons) East Dubuque Facility Ammonia 21
UAN 83 Urea (liquid and granular) 13 Nitric acid 3
Pasadena Facility Ammonium sulfate 169 Sulfuric acid 46
Ammonium thiosulfate 16
Forecasted Consumption in
Deliveries East Dubuque Facility Natural gas (in million
MMBtus) 2.4
Pasadena Facility Ammonia 45 Sulfur 61
Sulfuric acid 173
Maintenance Capital Expenditures (in
millions) East Dubuque Facility $ 3.7 Pasadena Facility $ 2.0
Growth Capital Expenditures (in millions)1
East Dubuque Facility $
5.2
Ammonia converter project $ 4.3 Pasadena Facility $
—
1We expect to fund growth capital expenditures with borrowings
under the partnership’s credit facility.
2015 Outlook and
Progress
The partnership is currently projecting consolidated adjusted
EBITDA to be approximately $118 million in 2015, a significant
improvement from last year. For 2015, the partnership projects
Adjusted EBITDA of approximately $117 million for East Dubuque and
approximately $10 million for Pasadena. Rentech Nitrogen projects
cash distributions for 2015 to be approximately $2.00 per unit. Our
previously provided guidance for 2015 production, deliveries and
consumption of inputs is unchanged.
For the Twelve Months Ending December 31,
2015 East Dubuque Pasadena
Partnership Facility
Facility Level Consolidated (stated in
millions, except per unit data) Net income (loss) $ 99 $ (101 ) $
(31 ) $ (33 ) Add: Net interest expense — — 22 22 Depreciation and
amortization 18 11 — 29 Other — 100 —
100 Adjusted EBITDA $ 117 $ 10 $ (9 ) $ 118 Less: Maintenance
capital expenditures (11 ) (4 ) — (15 ) Less: Net interest expense
— — (22 ) (22 ) Plus: Non-cash compensation expense —
— 2 2 Cash available for distribution $ 106 $ 6 $ (29
) $ 83 Cash available for distribution, per unit $ 2.72 $ 0.15 $
(0.74 ) 2.13 Less: Replenishment of reserves for WC purposes
— — (5 ) (5 ) Cash distribution $ 106 $
6 $ (34 ) $ 78 Cash distribution, per unit $ 2.72 $ 0.15 $ (0.87 )
2.00 Common units outstanding 39 39 39 39
Rentech Nitrogen provided the following key operating metrics,
progress against its forecasted product deliveries and consumption
of inputs for 2015 for the East Dubuque and Pasadena
facilities:
Locked-in orDelivered
East Dubuque Facility Deliveries1 Ammonia Tons
(in thousands) 138 or 68% Average price
$
554
UAN Tons (in thousands) 281 or 100% Average price
$
255
Natural Gas in Cost of Sales1 (million MMBtus) 11.3
or 87% Purchased average cost per MMBtu (including transportation
costs)
$
3.82
Unrealized derivatives (gain) per MMBtu
$
(0.37)
Average cost per MMBtu (including transportation costs)
$
3.45
Pasadena Facility Deliveries and Commitments1
Ammonium sulfate Tons (in thousands) 329 or 62% Average price
$
246
1Through July 30, 2015.
Second Quarter 2015 Cash Available for
Distribution
Cash distributions for the second quarter of 2015 will total
$38.9 million, or $1.00 per unit. The distribution will be paid on
August 28, 2015 to unit holders of record as of August 21, 2015.
The calculation of the cash available for distribution appears
below in this press release.
Conference Call with
Management
Rentech Nitrogen will hold a conference call today, August 11,
2015 at 7:00 a.m. PDT, during which senior management will review
the partnership’s financial results for this period and provide an
update on the business. Callers may listen to the live
presentation, which will be followed by a question and answer
segment, by dialing 800-774-6070 or 630-691-2753 and entering the
pass code 7746425#. An audio webcast of the call will be available
at www.rentechnitrogen.com within the
Investor Relations portion of the site under the Presentations
section. A replay will be available by audio webcast and
teleconference from 9:30 a.m. PDT on August 11 through 11:59 p.m.
PDT on August 18. The replay teleconference will be available by
dialing 888-843-7419 or 630-652-3042 and entering the audience
passcode 7746425#.
Rentech Nitrogen Partners, L.P.
Consolidated Statements of
Operations
(Amounts in Thousands, Except per Unit
Data)
For the Three Months
Ended For the Six Months Ended June 30, June
30, 2015 2014 2015
2014 (Unaudited) (Unaudited)
Revenues $
109,853 $ 113,609 $ 179,027 $ 169,889
Cost of sales
65,127 85,390 115,518 127,906
Gross
profit 44,726 28,219 63,509 41,983
Operating expenses Selling, general and administrative
expense 4,166 4,504 8,502 9,782 Depreciation and amortization 424
375 853 708 Pasadena asset impairment 101,772 — 101,772 — Pasadena
goodwill impairment — 27,202 — 27,202 Other expense 431
228 427 222 Total operating expenses
106,793 32,309 111,554 37,914
Operating
income (loss) (62,067 ) (4,090 ) (48,045 )
4,069
Other expense, net Interest expense (5,546 )
(4,809 ) (10,574 ) (9,813 ) Other income, net 1,411 —
1,408 — Total other expenses, net (4,135 )
(4,809 ) (9,166 ) (9,813 )
Loss before
income taxes (66,202 ) (8,899 ) (57,211 ) (5,744 ) Income tax
expense 9 25 47 55
Net loss $
(66,211 ) $ (8,924 ) $ (57,258 ) $ (5,799 ) Net loss per common
unit allocated to common
unitholders - Basic
$ (1.70 ) $ (0.23 ) $ (1.47 ) $ (0.15 ) Net loss per common unit
allocated to common
unitholders - Diluted
$ (1.70 ) $ (0.23 ) $ (1.47 ) $ (0.15 ) Weighted-average units used
to compute net loss
per common unit:
Basic 38,915 38,891 38,914 38,890
Diluted 38,915 38,891 38,914 38,890
For the Three Months
For the Six Months Ended June
30, Ended June 30, 2015 2014
2015 2014 Production Tons (in
thousands) East Dubuque
Facility: Ammonia 89 85 172 163 Ammonia Available for Sale
(included in line above) 50 48 96 85 UAN 69 71 139 150 Other
Products (excludes CO2 ) 75 74 146 151
Pasadena Facility:
Ammonium Sulfate 133 144 262 290 Sulfuric Acid 121 100 264 229
Ammonium Thiosulfate 16 15 35 35
Delivered Tons (in
thousands) East Dubuque Facility: Ammonia 79 72 110 79
UAN 62 82 110 131 Other Products (excludes CO2 ) 19 17 37 33
Pasadena Facility: Ammonium Sulfate 116 174 218 286 Sulfuric
Acid 36 20 74 41 Ammonium Thiosulfate 15 21 38 43
Average
Sales Price per Ton East Dubuque Facility: Ammonia $ 580
$ 548 $ 564 $ 547 UAN $ 286 $ 309 $ 278 $ 292
Pasadena
Facility: Ammonium Sulfate $ 273 $ 202 $ 260 $ 197 Sulfuric
Acid $ 84 $ 93 $ 86 $ 89 Ammonium Thiosulfate $ 82 $ 107 $ 164 $
147
Input Costs East Dubuque Facility:
Natural Gas Natural Gas Used in Production (Thousand MMBtus)
3,169 3,030 6,191 5,888 Average Natural Gas Cost per MMBtu,
including transportation cost, used in production $ 3.27 $ 4.99 $
3.96 $ 5.08 Natural Gas in Cost of Sales (Thousand MMBtus)
4,050 4,100 6,236 5,621 Purchased Average Natural Gas Cost per
MMBtu, Including Transportation Cost $
4.12
$
5.08
$
4.35
$
5.13
Unrealized Loss (Gain) on Derivatives $
(0.40
)
$
0.13
$
(0.68
)
$
0.10
Average Natural Gas Cost per MMBtu, Including Transportation Cost $
3.72
$
5.21
$
3.67
$
5.23
Input Costs Pasadena Facility: Ammonia
Ammonia Used in Production (Thousand Tons) 36 36 72 79 Ammonia in
Cost of Sales (Thousand Tons) 32 47 61 79
Sulfur Sulfur Used
in Production (Thousand Tons) 44 37 96 84 Sulfur in Cost of Sales
(Thousand Tons) 44 35 86 94
On-Stream Rates1:
East Dubuque Facility: Ammonia 100.0 % 100.0 % 100.0 % 100.0
% UAN 100.0 % 100.0 % 100.0 % 98.9 %
Pasadena Facility:
Ammonium Sulfate 86.1 % 81.9 % 87.5 % 81.5 % Sulfuric Acid 94.7 %
99.2 % 96.9 % 98.8 % 1 The on-stream factors for the ammonia, UAN,
ammonium sulfate and sulfuric acid plants equal the total days the
applicable plant operated in any given period, divided by the total
days in the period.
Rentech Nitrogen Partners, L.P. Statements of Operations
by Business Segment
(Stated in Thousands)
For the Three Months Ended
For the Six Months Ended June 30, June 30,
2015 2014 2015
2014 (in thousands) Revenues East Dubuque $ 72,060 $ 73,943
$ 108,812 $ 102,434 Pasadena 37,793 39,666
70,215 67,455 Total revenues $ 109,853 $ 113,609 $ 179,027 $
169,889 Gross profit (loss) East Dubuque $ 42,680 $ 32,952 $ 60,121
$ 45,350 Pasadena 2,046 (4,733 ) 3,388
(3,367 ) Total gross profit $ 44,726 $ 28,219 $ 63,509 $ 41,983
Selling, general and administrative expenses East Dubuque $ 1,000 $
1,088 $ 2,346 $ 2,221 Pasadena 844 1,247 1,640
3,076
Total segment selling, general and
administrative expenses
$ 1,844 $ 2,335 $ 3,986 $ 5,297 Depreciation and amortization East
Dubuque $ 65 $ 38 $ 134 $ 75 Pasadena 359 337
719 633
Total segment depreciation and
amortization recorded in operating expenses
424 375 853 708 Net income (loss) East
Dubuque $ 41,197 $ 31,578 $ 57,219 $ 42,787 Pasadena (99,526
) (33,546 ) (99,363 ) (34,332 ) Total segment
net income (loss) $ (58,329 ) $ (1,968 ) $ (42,144 ) $ 8,455
Reconciliation of segment net income (loss) to consolidated net
loss: Segment net income (loss) $ (58,329 ) $ (1,968 ) $ (42,144 )
$ 8,455
Partnership and unallocated expenses
recorded as selling, general and administrative expenses
(2,322 ) (2,169 ) (4,516 ) (4,485 )
Partnership and unallocated expenses
recorded as other expense
(31 ) — (60 ) — Unallocated interest expense (5,529 )
(4,787 ) (10,538 ) (9,769 ) Consolidated net loss $
(66,211 ) $ (8,924 ) $ (57,258 ) $ (5,799 )
Rentech Nitrogen Partners, L.P. Selected
Balance Sheet Data (Stated in Thousands) As
of As of June 30, December 31, 2015
2014 (in thousands) Cash $ 38,501 $ 28,028 Working capital
43,743 14,499 Construction in progress 12,726 47,758 Total assets
328,045 414,316 Debt 344,000 335,000 Total partners' capital
(deficit) (73,468 ) 8,891
Disclosure Regarding Non-GAAP Financial
Measures
Adjusted EBITDA is defined as net income (loss) plus net
interest expense and other financing costs, income tax expense,
depreciation and amortization and unusual items, like impairment
charges. As used in this table, we calculate cash available for
distribution as Adjusted EBITDA plus non-cash compensation expense,
less the sum of maintenance capital expenditures not funded by
financing proceeds, net interest expense and cash reserved for
working capital purposes. Adjusted EBITDA and cash available for
distribution are used as supplemental financial measures by
management and by external users of our financial statements, such
as investors and commercial banks, to assess:
- the financial performance of our assets
without regard to financing methods, capital structure or
historical cost basis; and
- our operating performance and return on
invested capital compared to those of other publicly traded limited
partnerships and other public companies, without regard to
financing methods and capital structure.
Net income (loss) excluding impairments are included to provide
management and investors with net income results for Rentech
Nitrogen and Pasadena that are more easily compared to the prior
year period.
Non-GAAP financial measures should not be considered
alternatives to any measure of financial performance or liquidity
presented in accordance with GAAP. Non-GAAP financial measures may
have material limitations as performance measures because they
exclude items that are necessary elements of our costs and
operations. In addition, Adjusted EBITDA and cash available for
distribution presented by other companies may not be comparable to
our presentation, since each company may define these terms
differently.
The table below reconciles Adjusted EBITDA to net income (loss)
for the second quarter of 2015. It also reconciles cash available
for distribution to Adjusted EBITDA, both of which are non-GAAP
financial measures, for the second quarter of 2015.
For the Three Months Ended June 30,
2015 East
Dubuque Pasadena Partnership
Facility Facility Level Consolidated
(in thousands, except per unit data) Net income (loss) $ 41,197 $
(99,526 ) $ (7,882 ) $ (66,211 ) Add: Net interest expense 17 —
5,529 5,546 Pasadena asset impairment — 101,772 — 101,772 Income
tax expense (14 ) 23 — 9 Depreciation and amortization 5,384 2,570
— 7,954 Other (16 ) (1,425 ) 30 (1,411
) Adjusted EBITDA $ 46,568 $ 3,414 $ (2,323 ) $ 47,659 Plus:
Non-cash compensation expense — — 387 387 Less: Maintenance capital
expenditures (2,376 ) (998 ) — (3,374 ) Less: Net interest expense
(17 ) — (5,529 ) (5,546 ) Less: Cash reserved for working capital
purposes — — (198 ) (198 ) Plus: Distributions of cash reserves
— — — — Cash available for distribution
$ 44,175 $ 2,416 $ (7,663 ) $ 38,928 Cash available for
distribution, per unit $ 1.13 $ 0.06 $ (0.19 ) 1.00 Common
units outstanding 38,928 38,928 38,928 38,928
The table below reconciles Adjusted EBITDA, which is a non-GAAP
financial measure, to net income (loss) for the six months ended
June 30, 2015.
For the Six Months Ended June 30, 2015
East Dubuque
Pasadena Partnership
Facility Facility Level
Consolidated
(in thousands, except per unit data)
Net income (loss) $ 57,219 $ (99,363 ) $ (15,114 ) $ (57,258 ) Add:
Net interest expense 36 — 10,538 10,574 Pasadena asset impairment —
101,772 — 101,772 Income tax expense — 47 — 47 Depreciation and
amortization 8,692 4,405 — 13,097 Other (42 ) (1,425
) 59 (1,408 ) Adjusted EBITDA $ 65,905 $ 5,436 $
(4,517 ) $ 66,824
The table below reconciles Adjusted EBITDA to net income (loss)
for the three months ended June 30, 2014.
For the Three Months Ended June 30,
2014
East Dubuque
Pasadena Partnership
Facility Facility Level Consolidated
(in thousands, except per unit data) Net income (loss) $ 31,578 $
(33,546 ) $ (6,956 ) $ (8,924 ) Add: Net interest expense 22 —
4,787 4,809 Pasadena goodwill impairment — 27,202 — 27,202 Income
tax expense (2 ) 27 — 25 Depreciation and amortization 5,155 2,474
— 7,629 Other — — — — Adjusted EBITDA $
36,753 $ (3,843 ) $ (2,169 ) $ 30,741
The table below reconciles Adjusted EBITDA to net income (loss)
for the six months ended June 30, 2014.
For the Six Months Ended June 30, 2014
East Dubuque
Pasadena
Partnership Facility Facility
Level Consolidated (in thousands, except per unit
data) Net income (loss) $ 42,787 $ (34,332 ) $ (14,254 ) $ (5,799 )
Add: Net interest expense 44 — 9,769 9,813 Pasadena goodwill
impairment — 27,202 — 27,202 Income tax expense 1 54 — 55
Depreciation and amortization 7,397 3,536 — 10,933 Other —
— — — Adjusted EBITDA $ 50,229 $ (3,540 ) $
(4,485 ) $ 42,204
The table below reconciles net income (loss) excluding
impairments for the second quarters of 2015 and 2014.
For the Three Months Ended June 30,
(Stated in Thousands, Except per Unit Data) 2015
2014 (unaudited) Net loss attributable
to common unit holders $ (66,211 ) $ (8,924 )
Pasadena asset impairment 101,772 — Pasadena goodwill impairment —
27,202
Net income attributable to common unit
holders excluding the Pasadena asset and goodwill impairments
$ 35,561 $ 18,278 Net loss per unit attributable to
common unit holders $ (1.70 ) $ (0.23 ) Per unit Pasadena asset
impairment 2.62 — Per unit Pasadena goodwill impairment —
0.70 Net income per unit attributable to common unit holders
excluding the Pasadena asset and goodwill impairments $ 0.92
$ 0.47 Weighted-Average Common Units Outstanding 38,915
38,891
The table below reconciles net income (loss) excluding
impairments for the six months ended June 30, 2015 and 2014.
For the Six Months Ended June 30,
(Stated in Thousands, Except per Unit
Data)
2015 2014 (unaudited) Net loss
attributable to common unit holders $ (57,258 ) $
(5,799 ) Pasadena asset impairment 101,772 — Pasadena goodwill
impairment — 27,202 Net income attributable to common unit
holders excluding the Pasadena asset and goodwill impairments $
44,514 $ 21,403 Net loss per unit attributable to
common unit holders $ (1.47 ) $ (0.15 ) Per unit Pasadena asset
impairment 2.62 — Per unit Pasadena goodwill impairment —
0.70 Net income per unit attributable to common unit holders
excluding the Pasadena asset and goodwill impairments $ 1.15
$ 0.55 Weighted-Average Common Units Outstanding 38,914
38,890
The table below reconciles net loss attributable to the Pasadena
facility excluding impairments for the second quarters of 2015 and
2014.
For the Three Months Ended June 30,
(Stated in thousands)
2015 2014 (unaudited) Net loss
for Pasadena $ (99,526 ) $ (33,546 ) Pasadena asset
impairment 101,772 — Pasadena goodwill impairment —
27,202 Net income (loss) attributable to Pasadena excluding
the Pasadena asset and goodwill impairments $ 2,246 $
(6,344 )
The table below reconciles net loss attributable to the Pasadena
facility excluding impairments for the six months ended June 30,
2015 and 2014.
For the Six Months Ended June 30,
(Stated in thousands) 2015
2014 (unaudited) Net loss for Pasadena $ (99,363 ) $
(34,332 ) Pasadena asset impairment 101,772 — Pasadena
goodwill impairment — 27,202 Net income (loss)
attributable to Pasadena excluding the Pasadena asset and goodwill
impairments $ 2,409 $ (7,130 )
About Rentech Nitrogen,
L.P.
Rentech Nitrogen (www.rentechnitrogen.com) was formed by Rentech,
Inc. to own, operate and expand its nitrogen fertilizer business.
Rentech Nitrogen’s assets consist of two fertilizer production
facilities owned by its operating subsidiaries. The East Dubuque
facility is located in the northwestern corner of Illinois, and
uses natural gas as a feedstock to produce primarily anhydrous
ammonia and UAN solution for sale to customers in the Mid Corn
Belt. The Pasadena facility is located in Pasadena, Texas, along
the Houston Ship Channel; it uses ammonia and sulfur as feedstocks
to produce ammonium sulfate and ammonium thiosulfate fertilizers,
and sulfuric acid. Rentech Nitrogen is the largest producer of
synthetic granulated ammonium sulfate fertilizer in North America,
with sales in the United States and internationally.
Additional Information About the
Proposed Transaction
In connection with the proposed transaction, CVR Partners
intends to file a registration statement on Form S-4 that will
include a prospectus of CVR Partners and a proxy statement of
Rentech Nitrogen, and CVR Partners and Rentech Nitrogen intend to
file other documents, with the Securities and Exchange Commission
(the “SEC”). INVESTORS ARE URGED TO READ THE PROXY
STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED WITH THE
SEC IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION.
A definitive proxy statement / prospectus will be sent to
unitholders of Rentech Nitrogen seeking their approval of the
transaction. Investors and security holders may obtain a free copy
of the definitive proxy statement / prospectus (when available) and
other documents filed by CVR Partners and Rentech Nitrogen with the
SEC at the SEC's website, www.sec.gov. The definitive proxy
statement / prospectus (when available) and such other documents
relating to CVR Partners may also be obtained free of charge by
directing a request to CVR Partners LP, Attn: Investor Relations,
2277 Plaza Drive, Suite 500, Sugar Land, TX 77479. The definitive
proxy statement / prospectus (when available) and such other
documents relating to Rentech Nitrogen may also be obtained free of
charge by directing a request to Rentech Nitrogen Partners, L.P.,
Attn: Investor Relations, Julie Dawoodjee Cafarella, 10877 Wilshire
Blvd., 10th Floor, Los Angeles, CA 90024.
Participants in the
Solicitation
CVR Partners, Rentech Nitrogen and their respective directors
and executive officers may, under the rules of the SEC, be deemed
to be "participants" in the solicitation of proxies in connection
with the proposed transaction. Information regarding directors and
executive officers of CVR Partners’ general partner is contained in
CVR Partners’ Form 10-K for the year ended December 31, 2014, which
has been filed with the SEC. Information regarding directors and
executive officers of Rentech Nitrogen’s general partner is
contained in Rentech Nitrogen’s Form 10-K for the year ended
December 31, 2014, which has been filed with the SEC. A more
complete description will be available in the registration
statement and the proxy statement/prospectus.
This document shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of
such securities, in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to appropriate
registration or qualification under the securities laws of such
jurisdiction. No offering of securities shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.
Forward-Looking
Statements
This press release contains forward-looking statements about
matters such as: our forecasts for 2015; the outlook for our
nitrogen fertilizer businesses; trends in the pricing and demand
for our nitrogen fertilizer products; the ability to consummate the
proposed transaction with CVR Partners; and our ability to sell the
Pasadena facility. These statements are based on management’s
current expectations. Actual results may differ materially as a
result of various risks and uncertainties. Other factors that could
cause actual results to differ from those reflected in the
forward-looking statements are set forth in Rentech Nitrogen’s
prior press releases and periodic public filings with the
Securities and Exchange Commission, which are available on Rentech
Nitrogen’s website at www.rentechnitrogen.com. The forward-looking
statements in this press release are made as of the date of this
press release. Rentech Nitrogen does not undertake to revise or
update these forward-looking statements, except to the extent that
it is required to do so under applicable law.
Qualified Notice to Nominees and
Brokers
This release is intended to serve as a qualified notice to
nominees and brokers as provided for under Treasury Regulation
Section 1.1446-4(b). Please note that 100 percent of Rentech
Nitrogen’s distributions to foreign investors are attributable to
income that is effectively connected with a United States trade or
business. Accordingly, Rentech Nitrogen’s distributions to foreign
investors are subject to federal income tax withholding at the
highest effective tax rate.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150811005411/en/
Rentech Nitrogen Partners, L.P.Julie Dawoodjee Cafarella,
310-571-9800Vice president of Investor Relations and
Communicationsir@rnp.net
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