SunCoke Energy Partners, L.P. Announces Solid First Quarter 2018 Results
SunCoke Energy Partners, L.P. Announces Solid First Quarter 2018 Results
- Net income attributable to SXCP was $12.2 million and operating cash flow was $66.1 million in the first quarter 2018
- Adjusted EBITDA attributable to SXCP was $48.7 million for the quarter
- Reaffirm full-year 2018 Adjusted EBITDA attributable to SXCP guidance of $215 million to $225 million
LISLE, Ill., April 26, 2018 /PRNewswire/ -- SunCoke Energy Partners, L.P. (NYSE: SXCP) today reported results for the first quarter 2018, which reflect solid operating results across SXCP's coke and logistics businesses.
"We continue to execute against our objectives and our solid first quarter performance was a testament to that focus. We remain on pace to achieve our full-year Adjusted EBITDA guidance," said Mike Rippey, Chairman, President and Chief Executive Officer of SunCoke Energy Partners, L.P.
Additionally, SunCoke Energy Partners, L.P. today announced its first quarter distribution of $0.40 per unit, which was a reduction from the $0.5940 per unit fourth quarter distribution.
Rippey continued, "Maintaining the distribution at this reduced level will allow us to further pay down debt and reach our stated leverage target of at or below 3.5x debt to EBITDA by the end of 2019. It will provide the desired cushion for our revolving credit facility's leverage covenant, which steps-down to 4.0x in June 2020, while also increasing SXCP's financial flexibility and driving long-term unitholder value."
FIRST QUARTER RESULTS
Three Months Ended March 31,
(Dollars in
millions) 2018 2017 Increase/
(Decrease)
--- ---------
Revenues $214.8 $195.6 $19.2
Adjusted
EBITDA(1) $49.5 $51.7 $(2.2)
Net income
(loss)
attributable
to SXCP $12.2 $(129.3) $141.5
------------- ----- ------- ------
(1) See definition of Adjusted EBITDA
and reconciliation elsewhere in
this release.
Revenues in first quarter 2018 increased $19.2 million from the prior year period, primarily reflecting the pass-through of higher coal prices in our Domestic Coke segment.
Adjusted EBITDA in the quarter decreased $2.2 million, as a result the timing of planned outage and maintenance costs in our Domestic Coke segment.
Net income attributable to SXCP in the first quarter 2018 was $12.2 million, up $141.5 million versus the same prior year period. The improvement was driven by the absence of the $145.6 million of deferred tax expense attributable to SXCP recorded in the prior year period related to the change in the qualifying income regulations finalized by the internal revenue service. This favorable impact was partially offset by lower operating results discussed above as well as higher interest expense as a result of the 2017 debt refinancing activities.
FIRST QUARTER SEGMENT INFORMATION
Domestic Coke
Domestic Coke consists of cokemaking facilities and heat recovery operations at our Haverhill, Middletown and Granite City cokemaking facilities, located in Franklin Furnace and Middletown, Ohio, and Granite City, Illinois, respectively.
Three Months Ended March 31,
(Dollars
in
millions,
except
per
ton
amounts) 2018 2017 Increase/
(Decrease)
--- ---------
Revenues $190.0 $173.2 $16.8
Adjusted
EBITDA(1) $40.3 $42.5 $(2.2)
Sales
Volume
(thousands
of
tons) 568 564 4
Adjusted
EBITDA
per
ton(2) $70.95 $75.35 $(4.40)
-------- ------ ------ ------
(1) See definition of Adjusted EBITDA
and reconciliation elsewhere in
this release.
(2) Reflects Domestic Coke Adjusted
EBITDA divided by Domestic Coke
sales volumes.
-- Revenues increased $16.8 million, primarily reflecting the pass-through
of higher coal prices.
-- Adjusted EBITDA decreased $2.2 million, driven by timing of planned
outage and maintenance costs as well as higher coal moisture from
adverse weather and logistics conditions resulting in lower production
and energy revenue at our Granite City facility.
Logistics
Logistics consists of the handling and mixing services of coal and other aggregates operated by SXCP at our Convent Marine Terminal ("CMT"), Lake Terminal and Kanawha River Terminals ("KRT").
Three Months Ended March 31,
(Dollars
in
millions,
except
per
ton
amounts) 2018 2017 Increase/
(Decrease)
--- ---------
Revenues $24.8 $22.4 $2.4
Intersegment
sales $1.7 $1.8 $(0.1)
Adjusted
EBITDA(1) $13.4 $13.0 $0.4
Tons
handled
(thousands
of
tons)(2) 5,531 5,449 82
CMT
take-
or-
pay
shortfall
tons
(thousands
of
tons)(3) 172 544 (372)
---------- --- --- ----
(1) See definition of Adjusted EBITDA
and reconciliation elsewhere in
this release.
(2) Reflects inbound tons handled
during the period.
(3) Reflects tons billed under take-
or-pay contracts where services
have not yet been performed.
-- Revenues and Adjusted EBITDA increased $2.4 million and $0.4 million,
respectively, driven primarily by record sales volumes at CMT as well as
an increase in rate on CMT take-or-pay tons in the current year period.
This benefit was mostly offset by increased costs at CMT and loss of
business at KRT resulting from near historic water levels during the
first quarter 2018.
Corporate and Other
Corporate and other expenses increased by $0.4 million to $4.2 million, driven primarily by unfavorable period-over-period mark-to-market adjustments in deferred compensation caused by changes in the Partnership's unit price.
2018 OUTLOOK
Our 2018 guidance is as follows:
-- Adjusted EBITDA attributable to SXCP is expected to be between $215 to
$225 million
-- Distributable Cash Flow expect to be between $122 to $132 million
-- Capital expenditures are projected to be approximately $61 million,
including approximately $35 million related to our Granite City gas
sharing project
RELATED COMMUNICATIONS
We will host our quarterly earnings call at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) today. The conference call will be webcast live and archived for replay in the Investors section of www.suncoke.com. Investors may participate in this call by dialing 1-833-236-5757 in the U.S. or 1-647-689-4185 if outside the U.S., confirmation code 5284275.
SUNCOKE ENERGY PARTNERS, L.P.
SunCoke Energy Partners, L.P. (NYSE: SXCP) is a publicly traded master limited partnership that manufactures high-quality coke used in the blast furnace production of steel and provides export and domestic material handling services to coke, coal, steel, power and other bulk and liquids customers. In our cokemaking business, we utilize an innovative heat-recovery technology that captures excess heat for steam or electrical power generation and have long-term, take-or-pay coke contracts that pass through commodity and certain operating costs. Our logistics terminals have the collective capacity to mix and transload more than 40 million tons of material each year and are strategically located to reach Gulf Coast, East Coast, Great Lakes and international ports. SXCP's General Partner is a wholly owned subsidiary of SunCoke Energy, Inc. (NYSE: SXC), which has approximately 55 years of cokemaking experience serving the integrated steel industry. To learn more about SunCoke Energy Partners, L.P., visit our website at www.suncoke.com.
DEFINITIONS
-- Adjusted EBITDA represents earnings before interest, taxes, depreciation
and amortization ("EBITDA"), adjusted for any loss (gain) on
extinguishment of debt and/or changes to our contingent consideration
liability related to our acquisition of CMT. Adjusted EBITDA does not
represent and should not be considered an alternative to net income or
operating income under GAAP and may not be comparable to other similarly
titled measures in other businesses. Management believes Adjusted EBITDA
is an important measure of the operating performance and liquidity of
the Partnership's net assets and its ability to incur and service debt,
fund capital expenditures and make distributions. Adjusted EBITDA
provides useful information to investors because it highlights trends in
our business that may not otherwise be apparent when relying solely on
GAAP measures and because it eliminates items that have less bearing on
our operating performance and liquidity. EBITDA and Adjusted EBITDA are
not measures calculated in accordance with GAAP, and they should not be
considered an alternative to net income, operating cash flow or any
other measure of financial performance presented in accordance with
GAAP.
-- Adjusted EBITDA attributable to SXCP equals Adjusted EBITDA less
Adjusted EBITDA attributable to noncontrolling interests.
-- Distributable Cash Flow equals Adjusted EBITDA plus sponsor support and
Logistics deferred revenue, less net cash paid for interest expense,
ongoing capital expenditures, accruals for replacement capital
expenditures, and cash distributions to noncontrolling interests; plus
amounts received under the Omnibus Agreement and acquisition expenses
deemed to be Expansion Capital under our Partnership Agreement.
Distributable Cash Flow is a non-GAAP supplemental financial measure
that management and external users of SXCP's financial statements, such
as industry analysts, investors, lenders and rating agencies use to
assess:
-- SXCP's operating performance as compared to other publicly traded
partnerships, without regard to historical cost basis;
-- the ability of SXCP's assets to generate sufficient cash flow to
make distributions to SXCP's unitholders;
-- SXCP's ability to incur and service debt and fund capital
expenditures; and
-- the viability of acquisitions and other capital expenditure projects
and the returns on investment of various investment opportunities.
We believe that Distributable Cash Flow provides useful information to investors in assessing SXCP's financial condition and results of operations. Distributable Cash Flow should not be considered an alternative to net income, operating income, cash flows from operating activities, or any other measure of financial performance or liquidity presented in accordance with generally accepted accounting principles (GAAP). Distributable Cash Flow has important limitations as an analytical tool because it excludes some, but not all, items that affect net income and net cash provided by operating activities and used in investing activities. Additionally, because Distributable Cash Flow may be defined differently by other companies in the industry, our definition of Distributable Cash Flow may not be comparable to similarly titled measures of other companies, thereby diminishing its utility.
-- Distributable Cash Flow Coverage Ratio equals Distributable Cash Flow
divided by estimated distributions to the limited and general partners.
-- Operating Cash Flow Coverage Ratio equals net cash provided by operating
activities divided by total estimated distributions to the limited and
general partners. Operating cash flow is generally expected to be
higher than Distributable Cash Flow as Distributable Cash Flow is
further reduced by certain cash reserves including capital expenditures,
an investing cash flow item. Additionally, Distributable Cash Flow
represents only the Partnership's share of available cash by excluding
Adjusted EBITDA attributable to noncontrolling interest, while operating
cash flow is reported on a consolidated basis.
-- Ongoing capital expenditures ("capex") are capital expenditures made to
maintain the existing operating capacity of our assets and/or to extend
their useful lives. Ongoing capex also includes new equipment that
improves the efficiency, reliability or effectiveness of existing
assets. Ongoing capex does not include normal repairs and maintenance,
which are expensed as incurred, or significant capital expenditures. For
purposes of calculating distributable cash flow, the portion of ongoing
capex attributable to SXCP is used.
-- Replacement capital expenditures ("capex") represents an annual accrual
necessary to fund SXCP's share of the estimated costs to replace or
rebuild our facilities at the end of their working lives. This accrual
is estimated based on the average quarterly anticipated replacement
capital that we expect to incur over the long term to replace our major
capital assets at the end of their working lives. The replacement capex
accrual estimate will be subject to review and prospective change by
SXCP's general partner at least annually and whenever an event occurs
that causes a material adjustment of replacement capex, provided such
change is approved by our conflicts committee.
FORWARD-LOOKING STATEMENTS
Some of the statements included in this press release constitute "forward-looking statements." Forward-looking statements include all statements that are not historical facts and may be identified by the use of such words as "believe," "expect," "plan," "project," "intend," "anticipate," "estimate," "predict," "potential," "continue," "may," "will," "should" or the negative of these terms or similar expressions. Forward-looking statements are inherently uncertain and involve significant known and unknown risks and uncertainties (many of which are beyond the control of SXCP) that could cause actual results to differ materially.
Such risks and uncertainties include, but are not limited to, domestic and international economic, political, business, operational, competitive, regulatory, and/or market factors affecting SXCP, as well as uncertainties related to: pending or future litigation, legislation or regulatory actions; liability for remedial actions or assessments under existing or future environmental regulations; gains and losses related to acquisition, disposition or impairment of assets; recapitalizations; access to, and costs of, capital; the effects of changes in accounting rules applicable to SXCP; and changes in tax, environmental and other laws and regulations applicable to SXCP's businesses.
Forward-looking statements are not guarantees of future performance, but are based upon the current knowledge, beliefs and expectations of SXCP management, and upon assumptions by SXCP concerning future conditions, any or all of which ultimately may prove to be inaccurate. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. SXCP does not intend, and expressly disclaims any obligation, to update or alter its forward-looking statements (or associated cautionary language), whether as a result of new information, future events or otherwise after the date of this press release except as required by applicable law.
SXCP has included in its filings with the Securities and Exchange Commission cautionary language identifying important factors (but not necessarily all the important factors) that could cause actual results to differ materially from those expressed in any forward-looking statement made by SXCP. For information concerning these factors, see SXCP's Securities and Exchange Commission filings such as its annual and quarterly reports and current reports on Form 8-K, copies of which are available free of charge on SXCP's website at www.suncoke.com. All forward-looking statements included in this press release are expressly qualified in their entirety by such cautionary statements. Unpredictable or unknown factors not discussed in this release also could have material adverse effects on forward-looking statements.
SunCoke Energy Partners, L.P.
Consolidated Statements of Operations
(Unaudited)
Three Months Ended March 31,
2018 2017
---- ----
(Dollars and units in millions,
except per unit amounts)
Revenues
Sales and other
operating
revenue $214.8 $195.6
------ ------
Costs and
operating
expenses
Cost of
products sold
and operating
expenses 157.1 135.4
Selling,
general and
administrative
expenses 8.2 8.5
Depreciation
and
amortization
expense 21.5 21.6
---- ----
Total costs and
operating
expenses 186.8 165.5
----- -----
Operating
income 28.0 30.1
Interest
expense, net 15.0 12.6
Income before
income tax
expense 13.0 17.5
Income tax
expense 0.3 149.2
Net income
(loss) 12.7 (131.7)
Less: Net
income (loss)
attributable
to
noncontrolling
interests 0.5 (2.4)
--- ----
Net income
(loss)
attributable
to SunCoke
Energy
Partners, L.P. $12.2 $(129.3)
===== =======
General
partner's
interest in
net income
(loss) $0.3 $(1.3)
Limited
partners'
interest in
net income
(loss) $11.9 $(128.0)
Net income
(loss) per
common unit
(basic and
diluted) $0.26 $(2.77)
Weighted
average common
units
outstanding
(basic and
diluted) 46.2 46.2
SunCoke Energy Partners, L.P.
Consolidated Balance Sheets
March 31, 2018 December 31, 2017
-------------- -----------------
(Unaudited)
(Dollars in millions)
Assets
Cash and
cash
equivalents $41.5 $6.6
Receivables 47.8 42.2
Receivables
from
affiliate,
net - 5.7
Inventories 79.7 79.4
Other
current
assets 3.2 1.9
--- ---
Total
current
assets 172.2 135.8
----- -----
Properties,
plants $423.1
and million
equipment at March
(net of 31, 2018
accumulated and
depreciation December
of 31,
$441.6 2017,
million respectively)
and 1,259.2 1,265.6
Goodwill 73.5 73.5
Other
intangible
assets,
net 163.6 166.2
Deferred
charges
and
other
assets 0.2 0.3
--- ---
Total
assets $1,668.7 $1,641.4
======== ========
Liabilities
and
Equity
Accounts
payable $77.6 $54.9
Accrued
liabilities 11.4 14.6
Deferred
revenue 3.6 1.7
Current
portion
of long-
term
debt and
financing
obligation 2.6 2.6
Interest
payable 16.8 4.0
Total
current
liabilities 112.0 77.8
----- ----
Long-
term
debt and
financing
obligation 818.4 818.4
Deferred
income
taxes 119.6 119.2
Other
deferred
credits
and
liabilities 10.1 10.1
---- ----
Total
liabilities 1,060.1 1,025.5
------- -------
Equity
Held by
public:
Common
units 31,
(issued 2017,
17,769,955 respectively)
and
17,958,420
units at
March
31, 2018
and
December 198.8 207.0
Held by
parent:
Common
units 31,
(issued 2017,
28,457,193 respectively)
and
28,268,728
units at
March
31, 2018
and
December 358.0 365.4
General
partner's
interest 39.5 31.2
---- ----
Partners'
capital
attributable
to
SunCoke
Energy
Partners,
L.P. 596.3 603.6
Noncontrolling
interest 12.3 12.3
---- ----
Total
equity 608.6 615.9
----- -----
Total
liabilities
and
equity $1,668.7 $1,641.4
======== ========
SunCoke Energy Partners, L.P.
Consolidated Statements of Cash Flows
(Unaudited)
Three Months Ended March 31,
2018 2017
---- ----
(Dollars in millions)
Cash Flows from Operating Activities:
Net income (loss) $12.7 $(131.7)
Adjustments to reconcile net income (loss) to net cash provided
by operating activities:
Depreciation and amortization expense 21.5 21.6
Deferred income tax expense 0.4 149.2
Changes in working capital pertaining to operating activities:
Receivables (5.6) (0.4)
Receivables/payables from affiliate, net 5.7 1.3
Inventories (0.3) (11.4)
Accounts payable 20.9 19.3
Accrued liabilities (3.0) (0.6)
Deferred revenue 1.9 3.1
Interest payable 12.8 (8.5)
Other (0.9) (2.5)
----
Net cash provided by operating activities 66.1 39.4
---- ----
Cash Flows from Investing Activities:
Capital expenditures (10.6) (4.2)
Net cash used in investing activities (10.6) (4.2)
----- ----
Cash Flows from Financing Activities:
Repayment of long-term debt - (0.3)
Repayment of financing obligation (0.6) (0.6)
Proceeds from revolving credit facility 53.5 10.0
Repayment of revolving credit facility (53.5) (10.0)
Distributions to unitholders (public and parent) (29.5) (29.5)
Distributions to noncontrolling interest (SunCoke Energy, Inc.) (0.5) (0.5)
Capital contributions from SunCoke 10.0 -
----
Net cash used in financing activities (20.6) (30.9)
----- -----
Net increase in cash, cash equivalents and restricted cash 34.9 4.3
Cash, cash equivalents and restricted cash at beginning of
period 6.6 42.3
Cash, cash equivalents and restricted cash at end of period $41.5 $46.6
===== =====
Supplemental Disclosure of Cash Flow Information
Interest paid $2.0 $20.9
Income taxes paid $1.3 $0.3
SunCoke Energy Partners, L.P.
Segment Operating Data
The following tables set forth financial and operating data for the three months ended March 31, 2018 and 2017:
Three Months Ended March 31,
2018 2017
---- ----
(Dollars in millions)
Sales and other operating revenues:
Domestic Coke $190.0 $173.2
Logistics 24.8 22.4
Logistics intersegment
sales 1.7 1.8
Elimination of
intersegment sales (1.7) (1.8)
---- ----
Total Sales and other
operating revenues $214.8 $195.6
====== ======
Adjusted EBITDA(1):
Domestic Coke $40.3 $42.5
Logistics 13.4 13.0
Corporate and Other (4.2) (3.8)
---- ----
Total Adjusted EBITDA $49.5 $51.7
===== =====
Coke Operating Data:
Domestic Coke capacity
utilization 98% 100%
Domestic Coke
production volumes
(thousands of tons) 554 567
Domestic Coke sales
volumes (thousands of
tons) 568 564
Domestic Coke Adjusted
EBITDA per ton(2) $70.95 $75.35
Logistics Operating Data:
Tons handled (thousands
of tons)(3) 5,531 5,449
CMT take-or-pay
shortfall tons
(thousands of tons)(4) 172 544
(1) See definition of Adjusted EBITDA
and reconciliation elsewhere in
this release.
(2) Reflects Domestic Coke Adjusted
EBITDA divided by Domestic Coke
sales volumes.
(3) Reflects inbound tons handled
during the period.
(4) Reflects tons billed under take-
or-pay contracts where services
have not yet been performed.
SunCoke Energy Partners, L.P.
Reconciliations of Non-GAAP Information
Net Income (loss) and Net Cash Provided by Operating Activities
to Adjusted EBITDA
Three Months Ended March 31,
2018 2017
---- ----
(Dollars in millions)
Net income (loss) $12.7 $(131.7)
Add:
Depreciation and amortization expense 21.5 21.6
Interest expense, net 15.0 12.6
Income tax expense 0.3 149.2
Adjusted EBITDA $49.5 $51.7
Subtract:
Adjusted EBITDA attributable to
noncontrolling interest(1) 0.8 0.8
Adjusted EBITDA attributable to
SunCoke Energy Partners $48.7 $50.9
===== =====
Three Months Ended March 31,
2018 2017
---- ----
(Dollars in millions)
Net cash provided by operating
activities $66.1 $39.4
Add:
Cash interest paid 2.0 20.9
Cash taxes paid 1.3 0.3
Changes in working capital(2) (19.6) (11.3)
Other adjustments to reconcile cash
provided by operating activities to
Adjusted EBITDA (0.3) 2.4
Adjusted EBITDA $49.5 $51.7
Subtract:
Adjusted EBITDA attributable to
noncontrolling interest(1) 0.8 0.8
Adjusted EBITDA attributable to
SunCoke Energy Partners $48.7 $50.9
===== =====
(1) Reflects net income attributable to
noncontrolling interest adjusted
for noncontrolling interest's
share of interest, taxes, income,
and depreciation and amortization.
(2) Changes in working capital exclude
those items not impacting Adjusted
EBITDA, such as changes in
interest payable and income taxes
payable.
SunCoke Energy Partners, L.P.
Reconciliations of Non-GAAP Information
Net Income (loss) and Operating Activities to
Distributable Cash Flow
Three Months Ended March 31,
2018 2017
---- ----
(Dollars in millions)
Net Income
(loss) $12.7 $(131.7)
Add:
Depreciation and
amortization
expense 21.5 21.6
Interest
expense, net 15.0 12.6
Income tax
expense 0.3 149.2
Logistics volume
shortfall
billings(1) 1.2 3.2
Subtract
Ongoing capex
(SXCP Share) 5.0 2.7
Replacement
capex accrual 1.9 1.9
Cash interest
accrual 14.9 11.8
Cash income tax
accrual(2) 0.6 0.6
Adjusted EBITDA
attributable to
noncontrolling
interest(3) 0.8 0.8
Distributable
cash flow $27.5 $37.1
===== =====
Three Months Ended March 31,
2018 2017
---- ----
(Dollars in millions)
Net cash
provided by
operating
activities $66.1 $39.4
Add:
Cash interest
paid 2.0 20.9
Cash taxes paid 1.3 0.3
Changes in
working
capital(4) (19.6) (11.3)
Logistics volume
shortfall
billings(1) 1.2 3.2
Other
adjustments to
reconcile cash
provided by
operating
activities to
Adjusted EBITDA (0.3) 2.4
Subtract:
Ongoing capex
(SXCP share) 5.0 2.7
Replacement
capex accrual 1.9 1.9
Cash interest
accrual 14.9 11.8
Cash tax
accrual(2) 0.6 0.6
Adjusted EBITDA
attributable to
noncontrolling
interest(3) 0.8 0.8
Distributable
cash flow $27.5 $37.1
===== =====
Quarterly cash
distribution $18.9 $29.5
Operating cash
flow coverage
ratio(5) 3.50x 1.34x
Distribution
coverage
ratio(6) 1.46x 1.26x
(1) Logistics volume shortfall billings
adjusts to include ton minimums
billed throughout the year in
Distributable Cash Flow to better
align with cash collection. Volume
shortfall billings on take-or-
pay contracts are recorded as
deferred revenue and are
recognized into GAAP income based
on the terms of the contract, at
which time they will be excluded
from Distributable Cash Flow.
(2) Cash tax impact from the operations
of Gateway Cogeneration Company
LLC, which is an entity subject to
income taxes for federal and state
purposes at the corporate level.
(3) Reflects net income attributable to
noncontrolling interest adjusted
for noncontrolling interest's
share of interest, taxes, income,
and depreciation and amortization.
(4) Changes in working capital exclude
those items not impacting Adjusted
EBITDA, such as changes in
interest payable and income taxes
payable.
(5) Operating cash flow coverage ratio
is net cash provided by operating
activities divided by total
estimated distributions to the
limited and general partners.
Operating cash flow is generally
expected to be higher than
Distributable Cash Flow as
Distributable Cash Flow is further
reduced by certain cash reserves
including capital expenditures, an
investing cash flow item.
Additionally, Distributable Cash
Flow represents only the
Partnership's share of available
cash by excluding Adjusted EBITDA
attributable to noncontrolling
interest, while operating cash
flow is reported on a consolidated
basis.
(6) Distribution cash coverage ratio is
distributable cash flow divided by
total estimated distributions to
the limited and general partners.
SunCoke Energy Partners, L.P.
Reconciliations of Non-GAAP Information
Estimated Net Income and Net Cash Provided by Operating Activities
to Estimated 2018 Consolidated Adjusted EBITDA
2018
Low High
--- ----
(Dollars in millions)
Net Income $68 $83
Add:
Depreciation and
amortization expense 88 83
Interest expense 60 60
Income tax expense 2 3
Adjusted EBITDA $218 $229
---- ----
Subtract:
Adjusted EBITDA
attributable to
controlling interest(1) 3 4
Adjusted EBITDA
attributable to SunCoke
Energy Partners, L.P. $215 $225
==== ====
2018
Low High
--- ----
(Dollars in millions)
Net cash provided by
operating activities $145 $160
Add:
Cash interest paid 60 60
Cash income tax paid 2 3
Changes in working
capital and other(2) 11 6
Adjusted EBITDA $218 $229
---- ----
Subtract:
Adjusted EBITDA
attributable to
noncontrolling
interest(1) 3 4
Adjusted EBITDA
attributable to SunCoke
Energy Partners.L.P. $215 $225
==== ====
(1) Reflects net income attributable to
noncontrolling interest adjusted
for noncontrolling interest's
share of interest, taxes, income,
and depreciation and amortization.
(2) Changes in working capital exclude
those items not impacting Adjusted
EBITDA, such as changes in
interest payable and income taxes
payable.
SunCoke Energy Partners, L.P.
Reconciliations of Non-GAAP Information
Estimated Net Income and Net Cash Provided by Operating Activities
to Estimated 2018 Distributable Cash Flow
2018
Low High
--- ----
Net Income $68 $83
Add:
Depreciation and
amortization expense 88 83
Interest expense 60 60
Income tax expense 2 3
Subtract:
Ongoing capex (SXCP
share) 25 25
Replacement capex
accrual 8 8
Cash interest accrual 57 57
Cash tax accrual(1) 3 3
Adjusted EBITDA
attributable to
noncontrolling
interest(2) 3 4
Distributable Cash
Flow $122 $132
==== ====
2018
Low High
--- ----
Net cash provided by
operating activities $145 $160
Add:
Cash Interest paid 60 60
Cash Income tax paid 2 3
Changes in working
capital(3) 11 6
Subtract:
Ongoing capex (SXCP
share) 25 25
Replacement capex
accrual 8 8
Cash interest accrual 57 57
Cash tax accrual(1) 3 3
Adjusted EBITDA
attributable to
noncontrolling
interest(2) 3 4
Distributable Cash
Flow $122 $132
==== ====
Estimated
distributions(4) $76 $76
Operating cash flow
coverage ratio(5) 1.92x 2.12x
Distribution cash
coverage ratio(6) 1.62x 1.75x
(1) Cash tax impact from the operations
of Gateway Cogeneration Company
LLC, which is an entity subject to
income taxes for federal and state
purposes at the corporate level.
(2) Reflects net income attributable to
noncontrolling interest adjusted
for noncontrolling interest's
share of interest, taxes, income,
and depreciation and amortization.
(3) Changes in working capital exclude
those items not impacting Adjusted
EBITDA, such as changes in
interest payable and income taxes
payable.
(4) Estimated distributions assumes
distributions are held constant at
$0.40 per unit each quarter.
(5) Operating cash flow coverage ratio
is net cash provided by operating
activities divided by total
estimated distributions to the
limited and general partners.
Operating cash flow is generally
expected to be higher than
Distributable Cash Flow as
Distributable Cash Flow is further
reduced by certain cash reserves
including capital expenditures, an
investing cash flow item.
Additionally, Distributable Cash
Flow represents only the
Partnership's share of available
cash by excluding Adjusted EBITDA
attributable to noncontrolling
interest, while operating cash
flow is reported on a consolidated
basis.
(6) Distribution cash coverage ratio is
distributable cash flow divided by
total estimated distributions to
the limited and general partners.
CONTACT: Investors and Media: Andy Kellogg & Kory Kutzke, (630) 824-1987
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SOURCE SunCoke Energy Partners, L.P.
