Delaware | 001-36062 | 46-2613366 | ||
(State or other jurisdiction | (Commission | (IRS Employer | ||
of incorporation or organization) | File Number) | Identification No.) |
Five Concourse Parkway | ||
Suite 2500 | ||
Atlanta, Georgia | 30328 | |
(Address of principal executive office) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Exhibit Number | Description | |||
99.1 | Press Release, dated November 3, 2016 |
CINER RESOURCES LP | ||
By: | Ciner Resource Partners LLC, | |
its General Partner | ||
By: | /s/ Nicole C. Daniel | |
Nicole C. Daniel | ||
Vice President, General Counsel and Secretary |
Exhibit Number | Description | |||
99.1 | Press Release, dated November 3, 2016 |
• | Net sales of $121.0 million increased 3.2% over the prior-year third quarter; year-to-date net sales of $352.1 million decreased 2.2% over the prior-year. |
• | Net income of $23.1 million decreased 14.1% over the prior-year third quarter; year-to-date net income of $65.9 million decreased 15.4% over the prior-year. |
• | Adjusted EBITDA of $30.6 million decreased 8.9% over the prior-year third quarter; year-to-date adjusted EBITDA of $87.9 million decreased 10.4% over the prior-year. |
• | Earnings per unit of $0.56 for the quarter decreased 13.8% over the prior-year third quarter of $0.65; year-to-date of $1.58 decreased 16.0% over the prior-year. |
• | Quarterly distribution declared per unit of $0.567 increased by 2.9% over the prior-year third quarter. |
• | Net cash provided by operating activities of $37.8 million decreased 8.7% over prior-year third quarter; year-to-date net cash provided by operating activities of $103.9 million increased by 1.0% over the prior-year. |
• | Distributable cash flow of $13.4 million remained flat over the prior-year third quarter; year-to-date distributable cash flow of $39.0 million decreased by 0.3% over the prior-year. The distribution coverage ratio was 1.18 and 1.15 for the three and nine months ended September 30, 2016, respectively; and 1.23 for the cumulative four quarters ended September 30, 2016. |
• | We expect our total volume sold to increase 2% to 4%; which includes an expected increase in domestic volume of 4% to 6%. |
• | We expect international prices to decline 3% to 6%. |
• | Maintenance of business capital expenditures are planned to be in the range of $11 to $13 million. |
• | Expansion capital expenditures are planned to be in the range of $15 to $18 million. |
Financial Highlights | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||
($ in millions, except per unit amounts) | 2016 | 2015 | % Change | 2016 | 2015 | % Change | |||||||||||||||
Soda ash volume produced (millions of short tons) | 0.690 | 0.656 | 5.2 | % | 2.021 | 1.984 | 1.9 | % | |||||||||||||
Soda ash volume sold (millions of short tons) | 0.697 | 0.638 | 9.3 | % | 2.033 | 1.951 | 4.2 | % | |||||||||||||
Net sales | $ | 121.0 | $ | 117.3 | 3.2 | % | $ | 352.1 | $ | 360.0 | (2.2 | )% | |||||||||
Net income | $ | 23.1 | $ | 26.9 | (14.1 | )% | $ | 65.9 | $ | 77.9 | (15.4 | )% | |||||||||
Net income attributable to Ciner Resources LP | $ | 11.1 | $ | 13.1 | (15.3 | )% | $ | 31.6 | $ | 37.6 | (16.0 | )% | |||||||||
Basic and Diluted Earnings per Unit | $ | 0.56 | $ | 0.65 | (13.8 | )% | $ | 1.58 | $ | 1.88 | (16.0 | )% | |||||||||
Adjusted EBITDA (1) | $ | 30.6 | $ | 33.6 | (8.9 | )% | $ | 87.9 | $ | 98.1 | (10.4 | )% | |||||||||
Adjusted EBITDA attributable to Ciner Resources LP(1) | $ | 15.0 | $ | 16.7 | (10.2 | )% | $ | 43.1 | $ | 48.4 | (11.0 | )% | |||||||||
Distributable cash flow attributable to Ciner Resources LP(1) | $ | 13.4 | $ | 13.4 | — | % | $ | 39.0 | $ | 39.1 | (0.3 | )% | |||||||||
Distribution coverage ratio (1) | 1.18 | 1.22 | (3.3 | )% | 1.15 | 1.20 | (4.2 | )% | |||||||||||||
(1) See non-GAAP reconciliations |
Three Months Ended September 30, | Percent Increase/(Decrease) | |||||||||
2016 | 2015 | |||||||||
Net sales ($ in millions): | ||||||||||
Domestic | $ | 48.4 | $ | 47.2 | 2.5% | |||||
International | $ | 72.6 | $ | 70.1 | 3.6% | |||||
Total net sales | $ | 121.0 | $ | 117.3 | 3.2% | |||||
Sales volumes (thousands of short tons): | ||||||||||
Domestic | 222.7 | 208.5 | 6.8% | |||||||
International | 473.9 | 429.1 | 10.4% | |||||||
Total soda ash volume sold | 696.6 | 637.6 | 9.3% | |||||||
Average sales price (per short ton): | ||||||||||
Domestic | $ | 217.12 | $ | 226.36 | (4.1)% | |||||
International | $ | 153.29 | $ | 163.49 | (6.2)% | |||||
Average | $ | 173.70 | $ | 184.05 | (5.6)% | |||||
Percent of net sales: | ||||||||||
Domestic sales | 40.0 | % | 40.2 | % | (0.5)% | |||||
International sales | 60.0 | % | 59.8 | % | 0.3% | |||||
Total percent of net sales | 100.0 | % | 100.0 | % |
Nine Months Ended September 30, | Percent Increase/(Decrease) | |||||||||
2016 | 2015 | |||||||||
Net sales ($ in millions): | ||||||||||
Domestic | $ | 144.3 | $ | 145.6 | (0.9)% | |||||
International | 207.8 | 214.4 | (3.1)% | |||||||
Total net sales | $ | 352.1 | $ | 360.0 | (2.2)% | |||||
Sales volumes (thousands of short tons): | ||||||||||
Domestic | 665.4 | 637.5 | 4.4% | |||||||
International | 1,367.9 | 1,313.5 | 4.1% | |||||||
Total soda ash volume sold | 2,033.3 | 1,951.0 | 4.2% | |||||||
Average sales price (per short ton): | ||||||||||
Domestic | $ | 216.82 | $ | 228.31 | (5.0)% | |||||
International | $ | 151.91 | $ | 163.24 | (6.9)% | |||||
Average | $ | 173.16 | $ | 184.50 | (6.1)% | |||||
Percent of net sales: | ||||||||||
Domestic sales | 41.0 | % | 40.4 | % | 1.5% | |||||
International sales | 59.0 | % | 59.6 | % | (1.0)% | |||||
Total percent of net sales | 100.0 | % | 100.0 | % |
($ in millions) | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Capital Expenditures | ||||||||||||||||
Maintenance | $ | 3.2 | $ | 4.4 | $ | 6.0 | $ | 13.8 | ||||||||
Expansion | 3.1 | 6.2 | 10.7 | 12.5 | ||||||||||||
Total | $ | 6.3 | $ | 10.6 | $ | 16.7 | $ | 26.3 | ||||||||
Operating and Other Data: | ||||||||||||||||
Ore to ash ratio (1) | 1.48: 1.0 | 1.51: 1.0 | 1.48: 1.0 | 1.51: 1.0 | ||||||||||||
(1) Ore to ash ratio expresses the number of short tons of trona ore needed to produce one short ton of soda ash and includes our deca rehydration recovery process. In general, a lower ore to ash ratio results in lower costs and improved efficiency. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(In millions, except per unit data) | 2016 | 2015 | 2016 | 2015 | |||||||||||
Net sales | $ | 121.0 | $ | 117.3 | $ | 352.1 | $ | 360.0 | |||||||
Operating costs and expenses: | |||||||||||||||
Cost of products sold | 83.9 | 79.2 | 245.8 | 247.2 | |||||||||||
Depreciation, depletion and amortization expense | 6.6 | 5.7 | 19.3 | 17.1 | |||||||||||
Selling, general and administrative expenses | 6.3 | 4.5 | 18.1 | 14.1 | |||||||||||
Loss on disposal of assets, net | 0.2 | — | 0.2 | — | |||||||||||
Total operating costs and expenses | 97.0 | 89.4 | 283.4 | 278.4 | |||||||||||
Operating income | 24.0 | 27.9 | 68.7 | 81.6 | |||||||||||
Other income/(expenses): | |||||||||||||||
Interest expense, net | (0.9 | ) | (1.0 | ) | (2.7 | ) | (3.1 | ) | |||||||
Other, net | — | — | (0.1 | ) | (0.6 | ) | |||||||||
Total other income/(expense), net | (0.9 | ) | (1.0 | ) | (2.8 | ) | (3.7 | ) | |||||||
Net income | $ | 23.1 | $ | 26.9 | $ | 65.9 | $ | 77.9 | |||||||
Net income attributable to non-controlling interest | 12.0 | 13.8 | 34.3 | 40.3 | |||||||||||
Net income attributable to Ciner Resources LP | $ | 11.1 | $ | 13.1 | $ | 31.6 | $ | 37.6 | |||||||
Other comprehensive income/(loss): | |||||||||||||||
Income/(loss) on derivative financial instruments | (1.3 | ) | (2.3 | ) | (0.9 | ) | (3.9 | ) | |||||||
Comprehensive income | 21.8 | 24.6 | 65.0 | 74.0 | |||||||||||
Comprehensive income attributable to non-controlling interest | 11.4 | 12.7 | 33.9 | 38.4 | |||||||||||
Comprehensive income attributable to Ciner Resources LP | $ | 10.4 | $ | 11.9 | $ | 31.1 | $ | 35.6 | |||||||
Net income per limited partner unit: | |||||||||||||||
Common - Public and Ciner Holdings (basic and diluted) | $ | 0.56 | $ | 0.65 | $ | 1.58 | $ | 1.88 | |||||||
Subordinated - Ciner Holdings (basic and diluted) | $ | 0.55 | $ | 0.65 | $ | 1.58 | $ | 1.88 | |||||||
Limited partner units outstanding: | |||||||||||||||
Weighted average common units outstanding (basic and diluted) | 9.8 | 9.8 | 9.8 | 9.8 | |||||||||||
Weighted average subordinated units outstanding (basic and diluted) | 9.8 | 9.8 | 9.8 | 9.8 |
As of | |||||||
(In millions) | September 30, 2016 | December 31, 2015 | |||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 29.6 | $ | 20.4 | |||
Accounts receivable, net | 32.0 | 33.8 | |||||
Accounts receivable - ANSAC | 49.9 | 52.2 | |||||
Due from affiliates, net | 6.3 | 11.9 | |||||
Inventory | 24.6 | 26.4 | |||||
Other current assets | 1.2 | 2.2 | |||||
Total current assets | 143.6 | 146.9 | |||||
Property, plant and equipment, net | 253.3 | 255.2 | |||||
Other non-current assets | 21.0 | 21.1 | |||||
Total assets | $ | 417.9 | $ | 423.2 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities: | |||||||
Current portion of long-term debt | $ | 8.6 | $ | — | |||
Accounts payable | $ | 16.4 | $ | 13.4 | |||
Due to affiliates | 3.2 | 4.6 | |||||
Accrued expenses | 29.2 | 25.2 | |||||
Total current liabilities | 57.4 | 43.2 | |||||
Long-term debt | 90.9 | 110.0 | |||||
Other non-current liabilities | 9.1 | 6.8 | |||||
Total liabilities | 157.4 | 160.0 | |||||
Commitments and Contingencies | |||||||
Equity: | |||||||
Common unitholders - Public and Ciner Holdings (9.9 units issued and outstanding at September 30, 2016 and 9.8 units issued and outstanding at December 31, 2015) | 110.1 | 110.8 | |||||
Subordinated unitholders - Ciner Holdings (9.8 units issued and outstanding at September 30, 2016 and December 31, 2015, respectively) | 42.2 | 43.3 | |||||
General partner unitholders - Ciner Resource Partners LLC (0.4 units issued and outstanding at September 30, 2016 and December 31, 2015, respectively) | 4.0 | 4.0 | |||||
Accumulated other comprehensive loss | (2.6 | ) | (2.1 | ) | |||
Partners’ capital attributable to Ciner Resources LP | 153.7 | 156.0 | |||||
Non-controlling interest | 106.8 | 107.2 | |||||
Total equity | 260.5 | 263.2 | |||||
Total liabilities and partners’ equity | $ | 417.9 | $ | 423.2 |
Nine Months Ended September 30, | |||||||
(In millions) | 2016 | 2015 | |||||
Cash flows from operating activities: | |||||||
Net income | $ | 65.9 | $ | 77.9 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation, depletion and amortization expense | 19.6 | 17.4 | |||||
Loss on disposal of assets, net | 0.2 | — | |||||
Equity-based compensation expense | 0.4 | 0.5 | |||||
Other non-cash items | 0.3 | 0.8 | |||||
Changes in operating assets and liabilities: | |||||||
(Increase)/decrease in: | |||||||
Accounts receivable, net | 1.8 | 4.7 | |||||
Accounts receivable - ANSAC | 2.3 | 3.0 | |||||
Due from affiliates, net | 5.6 | 9.5 | |||||
Inventory | 1.6 | (7.4 | ) | ||||
Other current and other non-current assets | 0.8 | (0.3 | ) | ||||
Increase/(decrease) in: | |||||||
Accounts payable | 2.1 | 1.6 | |||||
Due to affiliates | (1.4 | ) | (1.6 | ) | |||
Accrued expenses and other liabilities | 4.7 | (3.2 | ) | ||||
Net cash provided by operating activities | 103.9 | 102.9 | |||||
Cash flows from investing activities: | |||||||
Capital expenditures | (16.2 | ) | (28.1 | ) | |||
Net cash used in investing activities | (16.2 | ) | (28.1 | ) | |||
Cash flows from financing activities: | |||||||
Due to affiliates | — | (1.3 | ) | ||||
Borrowings on Ciner Wyoming credit facility | 7.0 | 4.0 | |||||
Repayments on Ciner Wyoming credit facility | (17.5 | ) | (28.0 | ) | |||
Distributions to common unitholders | (16.6 | ) | (15.8 | ) | |||
Distributions to general partner | (0.6 | ) | (0.7 | ) | |||
Distributions to subordinated unitholders | (16.5 | ) | (15.7 | ) | |||
Distributions to non-controlling interest | (34.3 | ) | (34.6 | ) | |||
Net cash used in financing activities | (78.5 | ) | (92.1 | ) | |||
Net increase/(decrease) in cash and cash equivalents | 9.2 | (17.3 | ) | ||||
Cash and cash equivalents at beginning of period | 20.4 | 31.0 | |||||
Cash and cash equivalents at end of period | $ | 29.6 | $ | 13.7 |
• | Adjusted EBITDA; |
• | Distributable cash flow; and |
• | Distribution coverage ratio. |
• | our operating performance as compared to other publicly traded partnerships in our industry, without regard to historical cost basis or, in the case of Adjusted EBITDA, financing methods; |
• | the ability of our assets to generate sufficient cash flow to make distributions to our unitholders; |
• | our ability to incur and service debt and fund capital expenditures; and |
• | the viability of capital expenditure projects and the returns on investment of various investment opportunities. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
($ in millions, except per unit data) | |||||||||||||||
Reconciliation of Adjusted EBITDA to net income: | |||||||||||||||
Net income | $ | 23.1 | $ | 26.9 | $ | 65.9 | $ | 77.9 | |||||||
Add backs: | |||||||||||||||
Depreciation, depletion and amortization expense | 6.6 | 5.7 | 19.3 | 17.1 | |||||||||||
Interest expense, net | 0.9 | 1.0 | 2.7 | 3.1 | |||||||||||
Adjusted EBITDA | $ | 30.6 | $ | 33.6 | $ | 87.9 | $ | 98.1 | |||||||
Less: Adjusted EBITDA attributable to non-controlling interest | 15.6 | 16.9 | 44.8 | 49.7 | |||||||||||
Adjusted EBITDA attributable to Ciner Resources LP | $ | 15.0 | $ | 16.7 | $ | 43.1 | $ | 48.4 | |||||||
Reconciliation of distributable cash flow to Adjusted EBITDA attributable to Ciner Resources LP: | |||||||||||||||
Adjusted EBITDA attributable to Ciner Resources LP | $ | 15.0 | $ | 16.7 | $ | 43.1 | $ | 48.4 | |||||||
Less: Cash interest expense, net attributable to Ciner Resources LP | 0.4 | 0.5 | 1.2 | 1.6 | |||||||||||
Maintenance capital expenditures attributable to Ciner Resources LP(1) | 1.2 | 2.8 | 2.9 | 7.7 | |||||||||||
Distributable cash flow attributable to Ciner Resources LP | $ | 13.4 | $ | 13.4 | $ | 39.0 | $ | 39.1 | |||||||
Cash distribution declared per unit | $ | 0.567 | $ | 0.551 | $ | 1.698 | $ | 1.634 | |||||||
Total distributions to unitholders and general partner | $ | 11.4 | $ | 11.0 | $ | 34.0 | $ | 32.7 | |||||||
Distribution coverage ratio | 1.18 | 1.22 | 1.15 | 1.20 | |||||||||||
Reconciliation of Adjusted EBITDA to net cash from operating activities: | |||||||||||||||
Net cash provided by operating activities | $ | 37.8 | $ | 41.4 | $ | 103.9 | $ | 102.9 | |||||||
Add/(less): | |||||||||||||||
Amortization of long-term loan financing | (0.1 | ) | (0.1 | ) | (0.3 | ) | (0.3 | ) | |||||||
Equity-based compensation expense | (0.1 | ) | (0.1 | ) | (0.4 | ) | (0.5 | ) | |||||||
Net change in working capital | (7.7 | ) | (8.5 | ) | (17.5 | ) | (6.3 | ) | |||||||
Interest expense, net | 0.9 | 1.0 | 2.7 | 3.1 | |||||||||||
Other non-cash items | (0.2 | ) | (0.1 | ) | (0.5 | ) | (0.8 | ) | |||||||
Adjusted EBITDA | $ | 30.6 | $ | 33.6 | $ | 87.9 | $ | 98.1 | |||||||
Less: Adjusted EBITDA attributable to non-controlling interest | 15.6 | 16.9 | 44.8 | 49.7 | |||||||||||
Adjusted EBITDA attributable to Ciner Resources LP | $ | 15.0 | $ | 16.7 | $ | 43.1 | $ | 48.4 | |||||||
Less: Cash interest expense, net attributable to Ciner Resources LP | 0.4 | 0.5 | 1.2 | 1.6 | |||||||||||
Maintenance capital expenditures attributable to Ciner Resources LP(1) | 1.2 | 2.8 | 2.9 | 7.7 | |||||||||||
Distributable cash flow attributable to Ciner Resources LP | $ | 13.4 | $ | 13.4 | $ | 39.0 | $ | 39.1 | |||||||
(1) The Partnership may fund expansion-related capital expenditures with borrowings under existing credit facilities such that expansion-related capital expenditures will have no impact on cash on hand or the calculation of cash available for distribution. In certain instances, the timing of the Partnership’s borrowings and/or its cash management practices will result in a mismatch between the period of the borrowing and the period of the capital expenditure. In those instances, the Partnership adjusts designated reserves (as provided in the partnership agreement) to take account of the timing difference. Accordingly, expansion-related capital expenditures have been excluded from the presentation of cash available for distribution. |
Cumulative Four Quarters ended Q3-2016 | Q3-2016 | Q2-2016 | Q1-2016 | Q4-2015 | Q3-2015 | |||||||||||||||||||
($ in millions, except per unit data) | ||||||||||||||||||||||||
Reconciliation of Adjusted EBITDA to net income: | ||||||||||||||||||||||||
Net income | $ | 94.3 | $ | 23.1 | $ | 21.8 | $ | 21.1 | $ | 28.3 | $ | 26.9 | ||||||||||||
Add backs: | ||||||||||||||||||||||||
Depreciation, depletion and amortization expense | 25.8 | 6.6 | 6.4 | 6.2 | 6.6 | 5.7 | ||||||||||||||||||
Interest expense, net | 3.7 | 0.9 | 0.9 | 0.9 | 1.0 | 1.0 | ||||||||||||||||||
Adjusted EBITDA | $ | 123.8 | $ | 30.6 | $ | 29.1 | $ | 28.2 | $ | 35.9 | $ | 33.6 | ||||||||||||
Less: Adjusted EBITDA attributable to non-controlling interest | 62.8 | 15.6 | 14.9 | 14.3 | 18.0 | 16.9 | ||||||||||||||||||
Adjusted EBITDA attributable to Ciner Resources LP | $ | 61.0 | $ | 15.0 | $ | 14.2 | $ | 13.9 | $ | 17.9 | $ | 16.7 | ||||||||||||
Adjusted EBITDA attributable to Ciner Resources LP | $ | 61.0 | $ | 15.0 | $ | 14.2 | $ | 13.9 | $ | 17.9 | $ | 16.7 | ||||||||||||
Less: Cash interest expense, net attributable to Ciner Resources LP | $ | 1.7 | $ | 0.4 | $ | 0.4 | $ | 0.4 | $ | 0.5 | $ | 0.5 | ||||||||||||
Maintenance capital expenditures attributable to Ciner Resources LP(1) | $ | 3.7 | $ | 1.2 | $ | 0.8 | $ | 1.0 | $ | 0.7 | $ | 2.8 | ||||||||||||
Distributable cash flow attributable to Ciner Resources LP | $ | 55.6 | $ | 13.4 | $ | 13.0 | $ | 12.5 | $ | 16.7 | $ | 13.4 | ||||||||||||
Cash distribution declared per unit | $ | 2.256 | $ | 0.567 | $ | 0.567 | $ | 0.564 | $ | 0.558 | $ | 0.551 | ||||||||||||
Total distributions to unitholders and general partner | $ | 45.2 | $ | 11.4 | $ | 11.4 | $ | 11.3 | $ | 11.1 | $ | 11.0 | ||||||||||||
Distribution coverage ratio | 1.23 | 1.18 | 1.14 | 1.11 | 1.50 | 1.22 | ||||||||||||||||||
(1) The Partnership may fund expansion-related capital expenditures with borrowings under existing credit facilities such that expansion-related capital expenditures will have no impact on cash on hand or the calculation of cash available for distribution. In certain instances, the timing of the Partnership’s borrowings and/or its cash management practices will result in a mismatch between the period of the borrowing and the period of the capital expenditure. In those instances, the Partnership adjusts designated reserves (as provided in the partnership agreement) to take account of the timing difference. Accordingly, expansion-related capital expenditures have been excluded from the presentation of cash available for distribution. |