Western Refining Logistics, LP Reports First Quarter 2016 Results

EL PASO, Texas, May 03, 2016 (GLOBE NEWSWIRE) -- Western Refining Logistics, LP (NYSE:WNRL) today reported first quarter 2016 net income attributable to limited partners of $14.0 million, or $0.28 per common limited partner unit, which compares to $15.3 million and  $0.33, respectively, in the first quarter of 2015. First quarter 2016 EBITDA was $28.5 million and distributable cash flow was $22.5 million; this compares to $24.2 million and $21.8 million, respectively, for the first quarter of 2015.

"We are pleased with the overall performance of WNRL and the strong distributable cash generated in the first quarter.  Our Wholesale business continues to grow and perform well financially.  In Logistics, first quarter crude oil volumes were impacted by the weather, planned maintenance at the Gallup refinery, storage and pipeline congestion, and an extended outage in local gas processing capacity," said WNRL Chief Executive Officer and President Jeff Stevens. “However, crude oil volumes in our Delaware Basin system grew throughout the quarter and we expect this growth to continue.”

On April 25, 2016, the board of directors declared a quarterly cash distribution for the first quarter of 2016 of $0.4025 per unit, or $1.61 per unit on an annualized basis. This distribution represents a 15.8% increase over the first quarter 2015 distribution of $0.3475 per unit and is the ninth consecutive increase in the quarterly distribution for WNRL unitholders.

Stevens concluded, “For our logistics business, we are encouraged by the activity we are seeing with crude oil producers in our area, especially the Delaware Basin.  We continue to invest in the business, adding to our crude oil gathering system and storage capacity which positions us well to take advantage of increasing production.”

Conference Call Information

On Tuesday, May 3, 2016, at 4:00 p.m. ET, WNRL will hold a webcast and conference call to discuss the reported results and provide an update on partnership operations. The webcast can be accessed at Western Refining Logistics, LP's website, www.wnrl.com. The call can also be heard by dialing (844) 831-3028 or (315) 625-6887, pass code: 76840837. The audio replay will be available two hours after the end of the call through May 17, 2016 by dialing (855) 859-2056 or (404) 537-3406, pass code: 76840837.

About Western Refining Logistics, LP

Western Refining Logistics, LP is principally a fee-based, growth-oriented master limited partnership formed by Western Refining, Inc. (NYSE:WNR) to own, operate, develop and acquire terminals, storage tanks, pipelines and other logistics assets related to the terminalling, transportation and storage of crude oil and refined products. Headquartered in El Paso, Texas, Western Refining Logistics, LP's assets include approximately 685 miles of pipelines, approximately 8.2 million barrels of active storage capacity, distribution of wholesale petroleum products and crude oil trucking.

More information about Western Refining Logistics, LP is available at www.wnrl.com.

Non-GAAP Financial Measures

In addition to our financial information presented in accordance with U.S. generally accepted accounting principles (GAAP), management utilizes non-GAAP measures to facilitate comparisons of past performance. This press release and supporting schedules include the non-GAAP measures Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Distributable Cash Flow. We believe certain investors and financial analysts use EBITDA and Distributable Cash Flow to evaluate WNRL’s financial performance between periods and to compare WNRL's performance to certain competitors. We believe certain investors and financial analysts use Distributable Cash Flow to determine the amount of cash generated from the partnership's operations and available for distribution to its unitholders. These additional financial measures are reconciled from the most directly comparable measures as reported in accordance with GAAP and should be viewed in addition to, and not in lieu of, financial information that we report in accordance with GAAP.

Cautionary Statement on Forward-Looking Statements

This press release contains forward-looking statements. The forward-looking statements reflect WNRL’s current expectation regarding future events, results or outcomes. The forward-looking statements contained herein include statements related to, among other things: growth and performance of WNRL’s wholesale business; crude oil volumes in the Delaware Basin system; crude oil producer activity; WNRL’s investment in its business, including additions to the crude oil gathering system and storage capacity; and WNRL’s positioning. These statements are subject to the general risks inherent in WNRL’s business. These expectations may or may not be realized and some of these expectations may be based upon assumptions or judgments that prove to be incorrect. In addition, WNRL’s business and operations involve numerous risks and uncertainties, many of which are beyond its control, which could result in WNRL’s expectations not being realized, or otherwise materially affect WNRL’s financial condition, results of operations, and cash flows. Additional information relating to the uncertainties affecting WNRL’s business is contained in its filings with the Securities and Exchange Commission to which you are referred. The forward-looking statements are only as of the date made. Except as required by law, WNRL does not undertake any obligation to (and expressly disclaims any obligation to) update any forward-looking statements to reflect events or circumstances after the date such statements were made, or to reflect the occurrence of unanticipated events.

Results of Operations

The following tables set forth WNRL's summary historical financial and operating data for the periods indicated below:

(1) We define EBITDA as earnings before interest and debt expense, provision for income taxes and depreciation and amortization. We define Distributable Cash Flow as EBITDA plus the change in deferred revenues, less debt interest accruals, income taxes paid, maintenance capital expenditures and distributions declared on our TexNew Mex units.

EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:

• EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;
  
• EBITDA does not reflect the interest expense or the cash requirements necessary to service interest or principal payments on our debt;
  
• EBITDA does not reflect changes in, or cash requirements for, our working capital needs; and
  
• EBITDA, as we calculate it, may differ from the EBITDA calculations of our affiliates or other companies in our industry, thereby limiting its usefulness as a comparative measure.
  

EBITDA and Distributable Cash Flow are used as supplemental financial measures by management and by external users of our financial statements, such as investors and commercial banks, to assess:

• our operating performance as compared to those of other companies in the midstream energy industry, without regard to financial methods, historical cost basis or capital structure;
  
• the ability of our assets to generate sufficient cash 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 returns on investment of various investment opportunities.
  

Distributable Cash Flow is also a quantitative standard used by the investment community with respect to publicly traded partnerships because the value of a partnership unit is, in part, measured by its yield. Yield is based on the amount of cash distributions a partnership can pay to a unitholder.

We believe that the presentation of these non-GAAP measures provides useful information to investors in assessing our financial condition and results of operations. The GAAP measure most directly comparable to EBITDA and Distributable Cash Flow is net income attributable to limited partners. These non-GAAP measures should not be considered as alternatives to net income or any other measure of financial performance presented in accordance with GAAP. EBITDA excludes some, but not all, items that affect net income attributable to limited partners. These non-GAAP measures may vary from those of other companies. As a result, EBITDA and Distributable Cash Flow as presented herein may not be comparable to similarly titled measures of other companies.

The calculation of EBITDA and Distributable Cash Flow includes the results of operations for the TexNew Mex Pipeline System   for the three months ended March 31, 2016.

The following table reconciles net income attributable to limited partners to EBITDA for the periods presented and Distributable Cash Flow for the three months ended March 31, 2016 and 2015, respectively.

(1) Some barrels of crude oil in route to Western's Gallup refinery and Permian/Delaware Basin are transported on more than one of our mainlines. Mainline movements for the Four Corners and Delaware Basin systems include each barrel transported on each mainline. During the second quarter of 2015, we began shipping crude oil from the Four Corners system, through the TexNew Mex Pipeline System, to the Permian/Delaware system.

(2) Storage shell capacities represent weighted-average capacities for the periods indicated.

(1) All wholesale fee based revenues are generated through fees charged to Western's refining segment for truck transportation and delivery of crude oil and asphalt. Affiliate and third-party sales based revenues result from sales of refined products to Western and third-party customers at a delivered price that includes charges for product transportation.

(2) Fuel margin per gallon is a measurement calculated by dividing the difference between fuel sales, net of transportation charges, and cost of fuel sales for our wholesale segment by the number of gallons sold. Fuel margin per gallon is a measure frequently used in the petroleum products wholesale industry to measure operating results related to fuel sales.

(3) Lubricant margin per gallon is a measurement calculated by dividing the difference between lubricant sales, net of transportation charges, and lubricant cost of products sold by the number of gallons sold. Lubricant margin is a measure frequently used in the petroleum products wholesale industry to measure operating results related to lubricant sales.