Oil and gas, coal, aggregates and industrial-minerals producer Natural Resource Partners L.P. (NRP) reported revenues of $91.6 million for the third quarter of 2014 compared to $82.2 million for the third quarter of 2013, and distributable cash flow, a non-GAAP measure, of $57.8 million compared to $104.6 million for the third quarter of 2013.
Net income per unit was $0.32 for both the third quarter of 2014 and 2013. NRP reported EBITDA, a non-GAAP measure, of $78.3 million in the third quarter of 2014 compared to $72.9 million for the third quarter of 2013. Reconciliations of the non-GAAP measures of distributable cash flow and EBITDA are included in the tables at the end of this release
“We continued to benefit in the third quarter from our diverse portfolio of natural resource assets,” said Wyatt Hogan, president. “All of our commodities performed in line with our expectations for the quarter, and we remain on track to meet our guidance for the year. Our acquisition of the VantaCore construction aggregates business and the recently announced acquisition of oil and gas interests in the Sanish Field in the Williston Basin will even further diversify NRP and contribute to our future growth. In addition, we saw increased coal production from our properties in all of our regions in the third quarter as compared to the second quarter, which is especially impressive in light of the continuing difficult market conditions for the coal industry.”
Third quarter 2014 total revenues and other income increased 11 percent from the same period of 2013 due largely from NRP’s diversification into other asset classes.
During the third quarter of 2014, NRP reduced its debt by $15.7 million bringing the total net reduction for the first nine months of the year to $69.2 million. Following the end of the quarter, NRP closed the VantaCore acquisition, issuing 2,426,690 common units and borrowing $169 million on NRP Operating’s revolving credit facility.
In addition, on October 6, NRP announced a definitive agreement to purchase certain non-operated working interests in the Williston Basin for $340 million. This acquisition is expected to close mid-November. In anticipation of this closing, NRP completed a common equity offering, issuing 8.5 million common units for net proceeds of $100.4 million and issued an additional $125 million of its 9.125 percent senior notes due 2018 in a private offering for net proceeds of $122.1 million. NRP anticipates funding the remainder of the purchase price using additional borrowings under the expected upsized NRP Oil and Gas revolving credit facility.
“After closing the VantaCore acquisition in October, and upon completion of the acquisition of the non-operated working interests in the Williston Basin, we anticipate combined borrowing capacity of approximately $145 million,” said Dwight Dunlap, chief financial officer. “That capacity along with our cash balance of $78 million as of Sept. 30, 2014 will provide ample liquidity for NRP.”