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Buckeye Partners L.P. L.P. Units Reports Operating Results (10-Q)

November 06, 2012 | About:
10qk

10qk

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Buckeye Partners L.P. L.P. Units (BPL) filed Quarterly Report for the period ended 2012-09-30.

Buckeye Partners, L.p. has a market cap of $4.36 billion; its shares were traded at around $48.94 with a P/E ratio of 20.4 and P/S ratio of 0.9. The dividend yield of Buckeye Partners, L.p. stocks is 8.6%. Buckeye Partners, L.p. had an annual average earning growth of 3.5% over the past 10 years. GuruFocus rated Buckeye Partners, L.p. the business predictability rank of 2-star.

Highlight of Business Operations:

Pipelines & Terminals. Adjusted EBITDA from the Pipelines & Terminals segment was $112.9 million for the three months ended September 30, 2012, which is an increase of $26.4 million, or 30.5%, from $86.5 million for the corresponding period in 2011. The positive factors impacting Adjusted EBITDA were primarily related to $13.0 million of favorable settlement experience, $8.0 million in additional revenue due to higher pipeline tariff rates, long-haul shipments and terminalling contract rate escalations, a $5.5 million increase in revenue due to higher pipeline and terminalling volumes, a $4.0 million increase in revenue resulting from the Perth Amboy Facility acquired in 2012, a $1.6 million increase in earnings due to the purchase of an additional 20% ownership interest in WesPac Memphis and a $1.3 million increase in other revenue resulting primarily from higher butane blending capabilities in the Northeast. The favorable settlement experience primarily related to the successful resolution of a $10.6 million product settlement allocation matter related to certain pipeline transportation-related services provided by Buckeye over a period of several years, of which $7.8 million related to services rendered in prior years but, for accounting purposes, was not recognized in revenue until the current period.

Development & Logistics. Adjusted EBITDA from the Development & Logistics segment was $3.2 million for the three months ended September 30, 2012, which is an increase of $0.7 million, or 25.8%, from $2.5 million for the corresponding period in 2011. The increase in Adjusted EBITDA was primarily due to $1.4 million in revenue related to the LPG storage caverns acquired in November 2011 and a $0.2 million decrease in third-party engineering and operations expenses, partially offset by a $0.4 million decrease in third-party engineering and operations revenue, both as a result of reduced construction contract services, and a $0.3 million increase in operating expenses, which primarily related to overhead costs and $0.2 million in operating expenses for the LPG storage caverns.

Pipelines & Terminals. Adjusted EBITDA from the Pipelines & Terminals segment was $290.7 million for the nine months ended September 30, 2012, which is an increase of $30.0 million, or 11.5%, from $260.7 million for the corresponding period in 2011. The positive factors impacting Adjusted EBITDA were related to a $37.3 million increase in revenue due to a full period of operations for the assets acquired in 2011 and the Perth Amboy Facility acquired in 2012, a $27.1 million increase in revenue due to higher pipeline tariff rates and terminalling contract rate escalations on assets owned prior to the 2011 and 2012 acquisitions (which we refer to as our legacy assets), $4.9 million of favorable net settlement experience and a $1.4 million increase in other revenue resulting primarily from higher butane blending capabilities in the Northeast. The favorable net settlement experience included the successful resolution of a $10.6 million product settlement allocation matter related to certain pipeline transportation-related services provided by Buckeye over a period of several years, of which $7.8 million related to services rendered in prior years but, for accounting purposes, was not recognized in revenue until the current period.

International Operations. Adjusted EBITDA from the International Operations segment was $95.8 million for the nine months ended September 30, 2012, which is an increase of $9.6 million, or 11.1%, from $86.2 million for the corresponding period in 2011. The positive factors impacting Adjusted EBITDA were primarily related to a $5.1 million decrease in expenses, which included professional fees and payroll costs, a $2.8 million increase in revenue as a result of the initial 1.1 million barrels of our BORCO expansion becoming operational as of the beginning of the quarter and an overall lease rate increase of 4.3%, and $1.7 million decrease in income allocated to noncontrolling interests related to the remaining 20% ownership interest in BORCO not acquired by us until February 16, 2011.

Development & Logistics. Adjusted EBITDA from the Development & Logistics segment was $9.0 million for the nine months ended September 30, 2012, which is an increase of $3.4 million, or 62.4%, from $5.6 million for the corresponding period in 2011. The increase in Adjusted EBITDA was primarily due to a $4.0 million increase in revenue related to the LPG storage caverns acquired in November 2011, a $2.5 million increase in third-party engineering and operations revenue as a result of new contracts and higher fees, partially offset by a $1.4 million increase in operating expenses, which primarily related to overhead costs, a $0.9 million increase in third-party engineering and operations expenses and a $0.8 million increase in operating expenses for the LPG storage caverns.

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