PVR Partners L.P.
) reported second-quarter 2013 pro forma earnings per unit of 5
cents, missing the Zacks Consensus Estimate by 8 cents and
year-ago quarter by 6 cents due to rise in interest expenses and
higher units outstanding.
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On a GAAP basis, the partnership's earnings per unit were 6
cents. A penny difference between GAAP and pro forma earnings was
due to a combined effect of a derivative loss and cash receipts
from derivatives settlement.
Second Quarter Operational Update
PVR Partners posted revenues of $273.5 million, surpassing the
Zacks Consensus Estimate by $11.5 million. Revenues increased
22.7% year over year primarily due to a strong contribution from
the natural gas business, and improvement in collection of
trunkline and gathering fees.
Total expenses increased 16.8% year over year to $243.5 million
primarily due to a rise in cost of gas purchased, general and
administrative expenses, operating costs, and depreciation
PVR Partners' adjusted earnings before interest, tax,
depreciation and amortization (EBITDA) increased 33.5% year over
year to $76.1 million.
Eastern Midstream Segment:
Revenues surged 115.2% year over year to nearly $45.4 million
primarily due to a 160% year-over-year increase in average
throughput volumes to 1.3 billion cubic feet per day (Bcfd) owing
to steady development in existing systems and impact of the Chief
Midcontinent Midstream Segment:
Revenues from this segment witnessed a rise of 18% year over year
to $197.9 million. The increase was primarily due to a 63.4%
year-over-year increase in natural gas revenues.
Coal and Natural Resource Management Segment:
This division posted revenues of nearly $30.2 million, down 10.7%
year over year primarily due to a decline in coal royalty
volumes, and lower coal production and pricing.
PVR Partners' cash and cash equivalents as of Jun 30, 2013, were
$14 million, down from $14.7 million as of Dec 31, 2012.
Net cash flow from operating activities during second-quarter
2013 was $25.6 million, higher than $23.8 million in the year-ago
During the quarter, PVR Partners invested $110.9 million in its
internal growth projects, including an investment of $97.5
million at the Eastern Midstream Segment.
PVR Partners projects adjusted EBITDA in the band of $160-$185
million for the Eastern Midstream Segment, $60-$70 million for
the Midcontinent Midstream Segment and $75-$85 million for the
Coal and Natural Resource Management Segment.
The partnership expects its total average daily Eastern Midstream
throughput volumes to be in the range of 1.6 to 1.8 Bcfd at the
end of 2013.
PVR Partners provided its full-year 2013 maintenance capital
spending in the band of $13-$15 million and maintained internal
growth capital in the range of $350-$400 million.
Other Company Releases
DCP Midstream Partners LP
) is slated to release its second-quarter earnings on Aug 6. The
Zacks Consensus Estimate is 40 cents.
Oiltanking Partners L.P.
) is slated to release its second-quarter earnings on Aug 7. The
Zacks Consensus Estimate is 47 cents.
) is slated to release its second-quarter earnings on Aug 8. The
Zacks Consensus Estimate is 48 cents.
It is evident from the PVR Partners' forthcoming capital spending
program that it will continue to set up and expand numerous
projects in the Marcellus, Utica, Cline and Mississippian Lime.
The partnership completed the Wyoming County trunkline project
and new Lycoming gathering system, and installed 65 new well
connections in the Eastern Midstream and Midcontinent Midstream
segments. In addition, PVR Partners is in the middle of several
projects, including a new trunkline and gathering system in the
Utica shale. We believe these projects will boost PVR Partners'
presence in the region as well as improve its future performance.
However, over-dependence on third party service-providers for
receiving and supplying natural gas and natural gas liquids to
the customers, and over-reliance on a limited group of customers
are our major concerns.
Radnor, Pa.-based PVR Partners owns and operates a string of
natural gas midstream pipeline systems and processing plants and
is also involved in the management of coal as well as natural gas
properties. The partnership currently has a Zacks Rank #3