PBF Logistics Declares Quarterly Distribution of $0.30 per Unit and Announces First Quarter 2021 Earnings Results

PARSIPPANY, N.J., April 29, 2021 /PRNewswire/ -- PBF Logistics LP (NYSE: PBFX) (the "Partnership") today announced first quarter 2021 net income attributable to the limited partners of $37.2 million, or $0.59 per common unit. During the quarter, the Partnership generated cash from operations of $54.8 million, EBITDA attributable to PBFX of $57.9 million, Adjusted EBITDA of $59.0 million and distributable cash flow of $48.2 million. Included in reported results for the first quarter are $1.1 million, or $0.02 per common unit, of non-cash unit-based compensation expense and continued environmental remediation costs associated with the East Coast Terminals.

PBF Logistics Logo (PRNewsfoto/PBF Logistics LP)

"PBF Logistics operated well during the first quarter of 2021. The Partnership's consistent results and financial performance reflect the strength of relationship with our sponsor. Our focus continues to be on the health and safety of our employees and operations and providing high-quality, uninterrupted service to our customers," said PBF Logistics GP LLC Executive Vice President Matt Lucey. "We announced a distribution of $0.30 per unit today and continued to reduce net leverage during the quarter. Going forward, we intend to remain conservative in our capital allocation and focus on strengthening the balance sheet."

As of March 31, 2021, the Partnership had approximately $355.0 million of liquidity, including approximately $44.0 million in cash and cash equivalents, and access to approximately $311.0 million under its revolving credit facility.

PBF Logistics Declares Quarterly Distribution
The board of directors of PBF Logistics GP LLC, the Partnership's general partner, declared a regular quarterly cash distribution of $0.30 per common unit. The distribution is payable on May 27, 2021, to unitholders of record at the close of business on May 13, 2021.

This release is intended to be a qualified notice to nominees under Treasury Regulations Section 1.1446-4(b). All of the Partnership's distributions to foreign investors are attributable to income that is effectively connected with a United States trade or business. Accordingly, the Partnership's distributions to foreign investors are subject to federal income tax withholding at the highest effective tax rate.

Non-GAAP Financial Measures
The Partnership defines EBITDA as net income (loss) before net interest expense (including amortization of loan fees and debt premium and accretion on discounted liabilities), income tax expense, depreciation, amortization, impairment expense and change in contingent consideration. The Partnership defines EBITDA attributable to PBFX as net income (loss) attributable to PBFX before net interest expense (including amortization of loan fees and debt premium and accretion on discounted liabilities), income tax expense, depreciation, amortization, impairment expense and change in contingent consideration attributable to PBFX, which excludes results of acquisitions from affiliates of PBF Energy prior to the effective dates of such transactions and earnings attributable to the CPI earn-out (the portion of earnings associated with an earn-out provision related to the purchase of CPI Operations LLC ("CPI"), (the "Contingent Consideration")). The Partnership defines Adjusted EBITDA as EBITDA attributable to PBFX excluding acquisition and transaction costs, non-cash unit-based compensation expense and items that meet the conditions of unusual, infrequent and/or non-recurring charges. The Partnership defines distributable cash flow as EBITDA attributable to PBFX plus non-cash unit-based compensation expense, less cash interest, maintenance capital expenditures attributable to PBFX and income taxes. Distributable cash flow will not reflect changes in working capital balances. EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow are not presentations made in accordance with U.S. generally accepted accounting principles ("GAAP").

For additional information on the Partnership's non-GAAP financial measures, including reconciliations to their most directly comparable financial measures calculated and presented in accordance with GAAP, refer to the supplemental information provided in "Results of Operations" and the Earnings Release Tables included herein.

Conference Call Information
The Partnership will host a conference call and webcast regarding quarterly results and other business matters on Thursday, April 29, 2021, at 11:00 a.m. ET. The call is being webcast and can be accessed at PBF Logistics' website, http://www.pbflogistics.com. The call can also be accessed by dialing (877) 407-8029 or (201) 689-8029. The audio replay will be available approximately two hours after the end of the call and will be available through the company's website.

Forward-Looking Statements
This press release contains forward-looking statements (as that term is defined under the federal securities laws) made by the Partnership and its management. Such statements are based on current expectations, forecasts and projections, including, but not limited to, anticipated financial and operating results, plans, objectives, expectations and intentions that are not historical in nature. Forward-looking statements should not be read as a guarantee of future performance or results, and may not necessarily be accurate indications of the times at, or by which, such performance or results will be achieved. Forward-looking statements are based on information available at the time, and are subject to various risks and uncertainties, including risks relating to the securities markets generally, the impact of adverse market conditions impacting PBFX's logistics and other assets, the possibility that the Partnership may not consummate any potential future acquisitions, the Partnership's plans for financing any potential future acquisitions, the duration and severity of the COVID-19 pandemic, and other risks inherent in PBFX's business. For more information concerning factors that could cause actual results to differ from those expressed or forecasted, see PBFX's filings with the Securities and Exchange Commission including its most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. Forward-looking statements reflect information, facts and circumstances only as of the date they are made. The Partnership assumes no responsibility or obligation to update forward-looking statements except as may be required by law.

PBF Logistics LP
PBF Logistics LP, headquartered in Parsippany, New Jersey, is a fee-based, growth-oriented master limited partnership formed by PBF Energy Inc. to own or lease, operate, develop and acquire crude oil and refined petroleum products terminals, pipelines, storage facilities and similar logistics assets.

Results of Operations (Unaudited)

Business Developments

COVID-19

The outbreak of the coronavirus disease 2019 ("COVID-19") pandemic continues to negatively impact worldwide economic and commercial activity and financial markets, as well as global demand for petroleum and petrochemical products. The COVID-19 pandemic and resulting governmental and consumer responses have also resulted in significant business and operational disruptions, including business and school closures, supply chain disruptions, travel restrictions, stay-at-home orders and limitations on the availability of workforces. Such impacts have resulted in revenue declines due to lower demand and throughput volumes across certain of our facilities, which may continue to affect our business for the foreseeable future. In response to the COVID-19 pandemic, we are taking steps to mitigate potential adverse impacts on our business and operations by limiting capital expenditures, reducing discretionary activities and third-party services and lowering our quarterly distribution to our minimum quarterly distribution of $0.30 per unit. This distribution reduction, effective with the distribution for the first quarter of 2020 that was paid on June 17, 2020, represents a strategic shift to build our cash flow coverage, de-lever our business and increase our financial resources as we continue to identify potential organic growth projects or strategic acquisitions. In addition, our parent sponsor and largest customer, PBF Energy Inc. ("PBF Energy"), has endeavored to take the necessary steps to preserve liquidity and solidify its operations under the adverse market conditions caused by the COVID-19 pandemic. Despite the measures we and PBF Energy have taken, we and PBF Energy have been, and likely will continue to be, adversely impacted by the COVID-19 pandemic. We are unable to predict the ultimate outcome of the economic impact and can provide no assurance that measures taken to mitigate the impact of the COVID-19 pandemic will be effective.

The full extent to which the COVID-19 pandemic impacts our business and operations, or that of our parent sponsor, is unknown and will depend on the severity, location and duration of the effects and spread of COVID-19, the effectiveness of the vaccine programs and the other actions undertaken by national, regional and local governments and health officials to contain the virus or treat its effects, related consumer responses and how quickly and to what extent economic conditions improve and normal business and operating conditions resume.

Factors Affecting Comparability

The following tables present our results of operations, related operational information and reconciliations of net income and net cash provided by operating activities to our EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow (each as defined below) for the three months ended March 31, 2021 and 2020. 

Our results of operations may not be comparable to our historical results of operations due to certain debt transactions and our annual inflation adjustment to our commercial agreements. Additionally, our results may not be comparative to prior periods due to the impact of the COVID-19 pandemic on our business, including lower throughput volumes at our terminals, as the industry reacts to the related economic downturn and volatile commodity market.

Furthermore, our results of operations may not be comparable to our historical results of operations due to the termination of the CPI Processing Agreement (as defined below). In connection with our acquisition of CPI Operations LLC ("CPI") from Crown Point International LLC, the purchase and sale agreement included an earn-out provision related to an existing commercial agreement (the "CPI Processing Agreement"), based on the future results of certain acquired idled assets, which recommenced operations in October 2019. In the third quarter of 2020, pursuant to the terms of the CPI Processing Agreement, the counterparty exercised its right to terminate the contract at the conclusion of the initial contract year, effective in the fourth quarter of 2020 (the "CPI Contract Termination"). While we have subsequently agreed with the counterparty to extend certain of the originally contracted services under the CPI Processing Agreement into the second quarter of 2021, the limited nature of these services has affected the comparability of our results of operations, specifically within our Storage segment, on a year-over-year basis.

Non-GAAP Financial Measures

We define EBITDA as net income (loss) before net interest expense (including amortization of loan fees and debt premium and accretion on discounted liabilities), income tax expense, depreciation, amortization, impairment expense and change in contingent consideration. We define EBITDA attributable to PBFX as net income (loss) attributable to PBFX before net interest expense (including amortization of loan fees and debt premium and accretion on discounted liabilities), income tax expense, depreciation, amortization, impairment expense and change in contingent consideration attributable to PBFX, which excludes the results of acquisitions from PBF LLC prior to the effective dates of such transactions and earnings attributable to the CPI earn-out (the portion of earnings associated with an earn-out provision related to the purchase of CPI (the "Contingent Consideration")). We define Adjusted EBITDA as EBITDA attributable to PBFX excluding acquisition and transaction costs, non-cash unit-based compensation expense and items that meet the conditions of unusual, infrequent and/or non-recurring charges. We define distributable cash flow as EBITDA attributable to PBFX plus non-cash unit-based compensation expense, less cash interest, maintenance capital expenditures attributable to PBFX and income taxes. Distributable cash flow will not reflect changes in working capital balances. We use distributable cash flow to calculate a measure we refer to as our coverage ratio. Our coverage ratio is calculated by dividing distributable cash flow by our total distribution declared. EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow are not presentations made in accordance with U.S. generally accepted accounting principles ("GAAP").

While EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow are not presentations made in accordance with GAAP, they are supplemental financial measures that management and external users of our condensed consolidated financial statements, such as industry analysts, investors, lenders and rating agencies, may use to assess:

  • our operating performance as compared to other publicly traded partnerships in the midstream energy industry, without regard to historical cost basis or, in the case of EBITDA, financing methods;
  • the ability of our assets to generate sufficient cash flow to make distributions to our unitholders;
  • our ability to incur and service debt and fund capital expenditures; and
  • the viability of acquisitions and other capital expenditure projects and the economic returns on various investment opportunities.

We believe that the presentation of EBITDA, EBITDA attributable to PBFX and Adjusted EBITDA provides useful information to investors in assessing our financial condition and results of operations and assists in evaluating our ongoing operating performance for current and comparative periods. We believe that the presentation of distributable cash flow provides useful information to investors as it is a widely accepted financial indicator used by investors to compare partnership performance and it provides investors with another perspective of the operating performance of our assets and the cash our business is generating. However, EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow should not be considered alternatives to net income, income from operations, net cash provided by operating activities or any other measure of financial performance or liquidity presented in accordance with GAAP.

EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow have important limitations as analytical tools because they exclude some, but not all, items that affect net income and net cash provided by operating activities. EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow are reconciled to their most directly comparable financial measures calculated and presented in accordance with GAAP in the Earnings Release Tables included herein.

These non-GAAP financial measures should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Our definitions of these non-GAAP financial measures may not be comparable to similarly titled measures of other partnerships, because they may be defined differently by other partnerships in our industry, thereby limiting their utility.

 

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in thousands, except unit and per unit data)



Three Months Ended

March 31,

2021


2020

Revenue (a):





Affiliate

$

75,933



$

75,543



Third-party

11,572



17,486


Total revenue

87,505



93,029






Costs and expenses:





Operating and maintenance expenses (a)

25,048



29,501



General and administrative expenses

4,464



4,387



Depreciation and amortization

9,405



11,282



Change in contingent consideration

655



206


Total costs and expenses

39,572



45,376






Income from operations

47,933



47,653






Other expense:





Interest expense, net

(10,287)



(11,849)



Amortization of loan fees and debt premium

(429)



(439)



Accretion on discounted liabilities

(6)



(552)


Net income attributable to PBF Logistics LP unitholders

$

37,211



$

34,813






Net income per limited partner unit (g):





Common units - basic

$

0.59



$

0.56



Common units - diluted

0.59



0.56






Weighted-average limited partner units outstanding (g):





Common units - basic

62,646,664



62,370,927



Common units - diluted

62,780,594



62,473,094






See Footnotes to Earnings Release Tables


 

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

KEY OPERATING AND FINANCIAL INFORMATION

(Unaudited, amounts in thousands except barrel and per unit data)









Three Months Ended

March 31,



2021


2020

Transportation and Terminaling Segment






Terminals






Total throughput (barrels per day ("bpd")) (b)(d)



219,870



300,392


Lease tank capacity (average lease capacity barrels per month) (d)



2,490,334



2,051,043


Pipelines






Total throughput (bpd) (b)(d)



153,463



162,527


Lease tank capacity (average lease capacity barrels per month) (d)



1,033,760



1,147,823








Storage Segment






Storage capacity reserved (average shell capacity barrels per month) (d)



7,605,161



7,607,643


Total throughput (bpd) (b)(d)



7,873



25,254






Cash Flow Information:





Net cash provided by (used in):






   Operating activities

$

54,822



$

18,647


   Investing activities

(1,254)



(6,080)


   Financing activities

(45,886)



68,490


      Net change in cash and cash equivalents



$

7,682



$

81,057






Other Financial Information:





EBITDA attributable to PBFX (c)

$

57,923



$

56,309



Adjusted EBITDA (c)

$

58,996



$

57,938



Distributable cash flow (c)

$

48,178



$

40,775



Quarterly distribution declared per unit (e)

$

0.30



$

0.30



Distributions (e):






Common

$

18,924



$

18,844





Total distributions

$

18,924



$

18,844





Coverage ratio (c)



2.54x



2.16x



Capital expenditures

$

1,254



$

6,080








See Footnotes to Earnings Release Tables

 

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

KEY OPERATING AND FINANCIAL INFORMATION (continued)

(Unaudited, in thousands)



March 31,


December 31,

Balance Sheet Information:


2021


2020


Cash and cash equivalents (f)

$

43,966



$

36,284



Property, plant and equipment, net

814,335



820,174



Total assets

932,837



933,552



Total debt (f)

706,274



720,845



Total liabilities

746,331



766,335



Partners' equity

186,506



167,217



Total liabilities and equity

932,837



933,552






See Footnotes to Earnings Release Tables












 

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

RECONCILIATION OF AMOUNTS REPORTED UNDER GAAP

TO EBITDA AND DISTRIBUTABLE CASH FLOW

(Unaudited, in thousands)





Three Months Ended

March 31,

2021


2020

Reconciliation of net income to EBITDA and distributable cash flow (c):





 Net income

$

37,211



$

34,813




Interest expense, net

10,287



11,849




Amortization of loan fees and debt premium

429



439




Accretion on discounted liabilities

6



552




Change in contingent consideration

655



206




Depreciation and amortization

9,405



11,282



 EBITDA

57,993



59,141




Less: Earnings attributable to the CPI earn-out

70



2,832



 EBITDA attributable to PBFX

57,923



56,309




Non-cash unit-based compensation expense

989



1,302




Cash interest

(10,346)



(11,988)




Maintenance capital expenditures attributable to PBFX

(388)



(4,848)



 Distributable cash flow

$

48,178



$

40,775






Reconciliation of net cash provided by operating activities to EBITDA and distributable cash flow (c):





 Net cash provided by operating activities

$

54,822



$

18,647



Change in operating assets and liabilities

(6,127)



29,947




Interest expense, net

10,287



11,849




Non-cash unit-based compensation expense

(989)



(1,302)



 EBITDA

57,993



59,141




Less: Earnings attributable to the CPI earn-out

70



2,832



 EBITDA attributable to PBFX

57,923



56,309




Non-cash unit-based compensation expense

989



1,302




Cash interest

(10,346)



(11,988)




Maintenance capital expenditures attributable to PBFX

(388)



(4,848)



 Distributable cash flow

$

48,178



$

40,775






See Footnotes to Earnings Release Tables

 

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

RECONCILIATION OF AMOUNTS REPORTED UNDER GAAP

TO EBITDA AND ADJUSTED EBITDA

(Unaudited, in thousands)





Three Months Ended

March 31,

2021


2020

Reconciliation of net income to EBITDA and Adjusted EBITDA (c):





 Net income

$

37,211



$

34,813




Interest expense, net

10,287



11,849




Amortization of loan fees and debt premium

429



439




Accretion on discounted liabilities

6



552




Change in contingent consideration

655



206




Depreciation and amortization

9,405



11,282



 EBITDA

57,993



59,141




Less: Earnings attributable to the CPI earn-out

70



2,832



 EBITDA attributable to PBFX

57,923



56,309




Acquisition and transaction costs



95




Non-cash unit-based compensation expense

989



1,302




East Coast Terminals environmental remediation costs

84



232



Adjusted EBITDA

$

58,996



$

57,938






See Footnotes to Earnings Release Tables

 

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

SEGMENT FINANCIAL INFORMATION

(Unaudited, in thousands)












Three Months Ended March 31, 2021



Transportation and Terminaling


Storage


Corporate


Consolidated Total

Total revenue (a)


$

71,477



$

16,028



$



$

87,505


Depreciation and amortization


7,235



2,170





9,405


Income (loss) from operations


46,609



5,788



(4,464)



47,933


Other expense






10,722



10,722


Capital expenditures


1,055



199





1,254













Three Months Ended March 31, 2020



Transportation and Terminaling


Storage


Corporate


Consolidated Total

Total revenue (a)


$

70,243



$

22,786



$



$

93,029


Depreciation and amortization


7,072



4,210





11,282


Income (loss) from operations


41,268



10,772



(4,387)



47,653


Other expense






12,840



12,840


Capital expenditures


3,626



2,454





6,080







Balance at March 31, 2021



Transportation and Terminaling


Storage


Corporate


Consolidated Total

Total assets


$

698,027



$

196,640



$

38,170



$

932,837













Balance at December 31, 2020



Transportation and Terminaling


Storage


Corporate


Consolidated Total

Total assets


$

715,308



$

200,130



$

18,114



$

933,552











See Footnotes to Earnings Release Tables

 

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

FOOTNOTES TO EARNINGS RELEASE TABLES

(Unaudited, in thousands, except per unit data)













(a)


See discussion of the factors affecting comparability noted on page 4. Our results of operations may not be comparable to the historical results of operations for the reasons described below:

 

Revenue - As a result of the CPI Contract Termination, effective in the fourth quarter of 2020, our revenues, specifically within or Storage segment, have decreased on a year-over-year basis.

 

In addition, our results may not be comparative to prior periods due to the impact of the COVID-19 pandemic on our business, including lower throughput at our terminals, as the industry reacts to the related economic downturn and volatile commodity markets.













(b)


Calculated as the sum of the average throughput per day for each asset group for the periods presented.













(c)


See "Non-GAAP Financial Measures" on page 5 for definitions of EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA, distributable cash flow and coverage ratio.













(d)


Operating information reflects activity subsequent to our acquisitions, the execution of the commercial agreements with PBF Holding and the completion of certain organic growth projects.




(e)


On April 29, 2021, we announced a quarterly cash distribution of $0.30 per limited partner unit based on the results of the first quarter of 2021. The distribution is payable on May 27, 2021 to PBFX unitholders of record at the close of business on May 13, 2021. The total distribution amount includes the expected distributions to be made related to first quarter earnings.




(f)


Management also utilizes net debt as a metric in assessing our leverage. Net debt is a non-GAAP measure calculated by subtracting cash and cash equivalents from total debt. We believe this measurement is also useful to investors since we have the ability to, and may decide to, use a portion of our cash and cash equivalents to retire or pay down our debt. This non-GAAP financial measure should not be considered in isolation or as a substitute for analysis of our debt levels as reported under GAAP. Our definition of net debt may not be comparable to similarly titled measures of other partnerships, because it may be defined differently by other partnerships in our industry, thereby limiting its utility. Our net debt as of March 31, 2021 and December 31, 2020 was $662,308 and $684,561, respectively.













(g)


We base our calculation of net income per limited partner unit on the weighted-average number of limited partner units outstanding during the period and the amount of available cash that has been, or will be, distributed to the limited partners.

 

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SOURCE PBF Logistics LP

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