| NET INCOME PER LIMITED PARTNER INTEREST |
NET INCOME PER LIMITED PARTNER INTEREST We allocate our net income among our general partner and limited partners using the two-class method in accordance with applicable authoritative accounting guidance. Under the two-class method, we allocate our net income and any net income in excess of distributions to our limited partners, our general partner and the holder of the incentive distribution rights, or IDRs, according to the distribution formula for available cash as set forth in our partnership agreement. We allocate any distributions in excess of earnings for the period to our limited partners and general partner based on their respective proportionate ownership interests in us, as set forth in our partnership agreement after taking into account distributions to be paid with respect to the IDRs. The formula for distributing available cash as set forth in our partnership agreement is as follows: | | | | | | | | Distribution Targets | | Portion of Quarterly Distribution Per Unit | | Percentage Distributed to Limited Partners | | Percentage Distributed to General Partner (including IDRs) (1) | Minimum Quarterly Distribution | | Up to $0.2875 | | 98% | | 2% | First Target Distribution | | > $0.2875 to $0.330625 | | 98% | | 2% | Second Target Distribution | | > $0.330625 to $0.359375 | | 85% | | 15% | Third Target Distribution | | > $0.359375 to $0.431250 | | 75% | | 25% | Thereafter | | Amounts above $0.431250 | | 50% | | 50% |
(1) Assumes our general partner maintains a 2% general partner interest in us.
We determined basic and diluted net income per limited partner unit as set forth in the following tables: | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended June 30, 2017 | | | Common Units | | Subordinated Units | | Class A
Units | | General
Partner
Units | | Total | | | (in thousands, except per unit amounts) | Net income attributable to general and limited partner interests in USD Partners LP (1) | | $ | 6,014 |
| | $ | 2,138 |
| | $ | 33 |
| | $ | 194 |
| | $ | 8,379 |
| Less: Distributable earnings (2) | | 6,931 |
| | 2,227 |
| | 29 |
| | 201 |
| | 9,388 |
| Distributions in excess of earnings | | $ | (917 | ) | | $ | (89 | ) | | $ | 4 |
| | $ | (7 | ) | | $ | (1,009 | ) | Weighted average units outstanding (3) | | 17,329 |
| | 6,278 |
| | 93 |
| | 461 |
| | 24,161 |
| Distributable earnings per unit (4) | | $ | 0.40 |
| | $ | 0.35 |
| | $ | 0.31 |
| | | | | Overdistributed earnings per unit (5) | | (0.05 | ) | | (0.01 | ) | | 0.04 |
| | | | | Net income per limited partner unit (basic and diluted) | | $ | 0.35 |
| | $ | 0.34 |
| | $ | 0.35 |
| | | | |
| | (1) | Represents net income allocated to each class of units based on the actual ownership of the Partnership during the period. The net income for each class of limited partner interest has been reduced by its proportionate amount of the approximate $37 thousand attributed to the general partner for its incentive distribution rights |
| | (2) | Represents the distributions payable for the period based upon the quarterly distribution amount of $0.34 per unit, or $1.36 per unit on an annualized basis. Amounts presented for each class of unit include a proportionate amount of the $388 thousand distributable to holders of the Equity-classified Phantom Units pursuant to the distribution equivalent rights granted under the USD Partners LP 2014 Long-Term Incentive Plan. |
| | (3) | Represents the weighted average units outstanding for the period. |
| | (4) | Represents the total distributable earnings divided by the weighted average number of units outstanding for the period. |
| | (5) | Represents the distributions in excess of earnings divided by the weighted average number of units outstanding for the period. |
| | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended June 30, 2016 | | | Common Units | | Subordinated Units | | Class A
Units | | General
Partner
Units | | Total | | | (in thousands, except per unit amounts) | Net income attributable to general and limited partner interests in USD Partners LP (1) | | $ | 3,206 |
| | $ | 1,893 |
| | $ | 32 |
| | $ | 104 |
| | $ | 5,235 |
| Less: Distributable earnings (2) | | 4,622 |
| | 2,727 |
| | 46 |
| | 150 |
| | 7,545 |
| Distributions in excess of earnings | | $ | (1,416 | ) | | $ | (834 | ) | | $ | (14 | ) | | $ | (46 | ) | | $ | (2,310 | ) | Weighted average units outstanding (3) | | 14,182 |
| | 8,371 |
| | 139 |
| | 461 |
| | 23,153 |
| Distributable earnings per unit (4) | | $ | 0.33 |
| | $ | 0.33 |
| | $ | 0.33 |
| | | | | Overdistributed earnings per unit (5) | | (0.10 | ) | | (0.10 | ) | | (0.10 | ) | | | | | Net income per limited partner unit (basic and diluted) | | $ | 0.23 |
| | $ | 0.23 |
| | $ | 0.23 |
| | | | |
| | (1) | Represents net income allocated to each class of units based on the actual ownership of the Partnership during the period. |
| | (2) | Represents the distributions paid for the period based upon the quarterly distribution of $0.315 per unit, or $1.26 per unit on an annualized basis. Amounts presented for each class of unit include a proportionate amount of the $252 thousand distributed to holders of the Equity-classified Phantom Units pursuant to the distribution equivalent rights granted under the USD Partners LP 2014 Long-Term Incentive Plan. |
| | (3) | Represents the weighted average units outstanding for the period. |
| | (4) | Represents the total distributable earnings divided by the weighted average number of units outstanding for the period. |
| | (5) | Represents the distributions in excess of earnings divided by the weighted average number of units outstanding for the period. |
| | | | | | | | | | | | | | | | | | | | | | | | Six Months Ended June 30, 2017 | | | Common Units | | Subordinated Units | | Class A
Units | | General
Partner
Units | | Total | | | (in thousands, except per unit amounts) | Net income attributable to general and limited partner interests in USD Partners LP (1) | | $ | 9,422 |
| | $ | 3,784 |
| | $ | 59 |
| | $ | 312 |
| | $ | 13,577 |
| Less: Distributable earnings (2) | | 12,752 |
| | 4,437 |
| | 62 |
| | 377 |
| | 17,628 |
| Distributions in excess of earnings | | $ | (3,330 | ) | | $ | (653 | ) | | $ | (3 | ) | | $ | (65 | ) | | $ | (4,051 | ) | Weighted average units outstanding (3) | | 16,283 |
| | 6,856 |
| | 105 |
| | 461 |
| | 23,705 |
| Distributable earnings per unit (4) | | $ | 0.78 |
| | $ | 0.65 |
| | $ | 0.59 |
| | | | | Overdistributed earnings per unit (5) | | (0.20 | ) | | (0.10 | ) | | (0.03 | ) | | | | | Net income per limited partner unit (basic and diluted) | | $ | 0.58 |
| | $ | 0.55 |
| | $ | 0.56 |
| | | | |
| | (1) | Represents net income allocated to each class of units based on the actual ownership of the Partnership during the period. The net income for each class of limited partner interest has been reduced by its proportionate amount of the approximate $52 thousand attributed to the general partner for its incentive distribution rights. |
| | (2) | Represents the per unit distributions paid of $0.335 per unit for the three months ended March 31, 2017 and $0.34 payable for the three months ended June 30, 2017, representing a year-to-date distribution amount of $0.675 per unit. Amounts presented for each class of unit include a proportionate amount of the $397 thousand distributed and $388 thousand distributable to holders of the Equity-classified Phantom Units pursuant to the distribution equivalent rights granted under the USD Partners LP 2014 Long-Term Incentive Plan. |
| | (3) | Represents the weighted average units outstanding for the period. |
| | (4) | Represents the total distributable earnings divided by the weighted average number of units outstanding for the period. |
| | (5) | Represents the distributions in excess of earnings divided by the weighted average number of units outstanding for the period. |
| | | | | | | | | | | | | | | | | | | | | | | | Six Months Ended June 30, 2016 | | | Common Units | | Subordinated Units | | Class A
Units | | General
Partner
Units | | Total | | | (in thousands, except per unit amounts) | Net income attributable to general and limited partner interests in USD Partners LP (1) | | $ | 4,361 |
| | $ | 2,829 |
| | $ | 48 |
| | $ | 147 |
| | $ | 7,385 |
| Less: Distributable earnings (2) | | 9,134 |
| | 5,391 |
| | 89 |
| | 297 |
| | 14,911 |
| Distributions in excess of earnings | | $ | (4,773 | ) | | $ | (2,562 | ) | | $ | (41 | ) | | $ | (150 | ) | | $ | (7,526 | ) | Weighted average units outstanding (3) | | 13,546 |
| | 8,969 |
| | 152 |
| | 461 |
| | 23,128 |
| Distributable earnings per unit (4) | | $ | 0.67 |
| | $ | 0.60 |
| | $ | 0.59 |
| | | | | Overdistributed earnings per unit (5) | | (0.35 | ) | | (0.29 | ) | | (0.27 | ) | | | | | Net income per limited partner unit (basic and diluted) | | $ | 0.32 |
| | $ | 0.31 |
| | $ | 0.32 |
| | | | |
| | (1) | Represents net income allocated to each class of units based on the actual ownership of the Partnership during the period. |
| | (2) | Represents the distributions paid of $0.3075 per unit with respect to the three months ended March 31, 2016, and $0.315 for the three months ended June 30, 2016, representing a year-to-date distribution amount of $0.6225 per unit. Amounts presented for each class of unit include a proportionate amount of the $499 thousand distributed to holders of the Equity-classified Phantom Units pursuant to the distribution equivalent rights granted under the USD Partners LP 2014 Long-Term Incentive Plan. |
| | (3) | Represents the weighted average units outstanding for the period. |
| | (4) | Represents the total distributable earnings divided by the weighted average number of units outstanding for the period. |
| | (5) | Represents the distributions in excess of earnings divided by the weighted average number of units outstanding for the period. |
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