Buckeye Partners, L.P.
) earnings from continuing operations in first-quarter 2014 were
87 cents per unit, missing the Zacks Consensus Estimate of 95
cents by 8.4%. Also, quarterly earnings decreased 3.3% year over
year, primarily due to an increase in total expenses and dilution
from higher units outstanding.
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Buckeye Partners released its first-quarter results before the
market opened on May 2, 2014. The price edged up 1.1% in
intra-day trading to close at $77.15. Despite earnings coming shy
of expectation, the positive movement in unit prices could be
attributed to the strong top line and clear visibility of future
Buckeye Partners' total revenue at the end of the quarter was
$1,991.8 million, surpassing the Zacks Consensus Estimate of
$1,296 million by 53.7%. Reported top line increased 49.6% from
$1,331.1 million a year ago. We believe the improvement in
revenues also boosted the unit price.
Total revenue improved primarily on the back increased
contribution from Buckeye Partners'
Global Marine Terminals
Development & Logistics
(up 41.3%) and
Pipeline and Terminal operations
(up 15.3%) segments.
In the quarter under review, Buckeye Partners' adjusted earnings
before interest, taxes, depreciation, and amortization (EBITDA)
from continuing operations moved up 17.7% year over year to
Total costs and expenses increased 53.2% year over year to
$1,850.6 million. Higher cost of product sales and operating and
depreciation expenses led to the increase in total expenses.
The partnership's operating income was $141.3 million, up 14.4%
from $123.5 million a year ago.
Interest and debt expenses during the quarter increased 36.4%
year over year to $41.2 million, primarily due to higher debt
Buckeye Partners' total cash and cash equivalents, as of Mar 31,
2014, were nearly $31.3 million versus $5.0 million as of Dec 31,
Long-term debt, as of Mar 31, 2014, was $3,234 million compared
with $3,092.7 million as of Dec 31, 2013.
During the quarter, the partnership spent $18.7 million as
maintenance capital expenditures, up 266.6% from the prior-year
Buckeye Partners will pay cash distribution for first-quarter
2014 of $1.10 per limited partner unit, up around 5% from the
prior-year figure. The incremental cash distribution will be paid
on May 19, 2014 to unitholders of record as of May 12.
In 2014, Buckeye Partners plans to spend $300 million as growth
Other Earnings Releases
Boardwalk Pipeline Partners, LP
) reported first-quarter 2014 earnings of 44 cents per unit,
surpassing the Zacks Consensus Estimate of 32 cents by 37.5%.
Despite reporting unfavorable earnings results in first-quarter
2014, Buckeye Partners' scheduled completion of the acquisition
of 20 liquid petroleum products terminals from
), steady investments in crude rail operations at the Chicago
Complex and construction on crude rail facility at Perth Amboy
besides signing long-term contracts are expected to play an
important role for its future performance.
Buckeye Partners presently holds a Zacks Rank #3 (Hold). A
better-ranked stock in the same industry include
Energy Transfer Equity, L.P.
), which carries a Zacks Rank #2 (Buy).