Home | Business News | Browse by Publication | P | PR Newswire

Calumet Specialty Products Partners, L.P. Reports First Quarter 2009 Earnings.

Article Excerpt
INDIANAPOLIS, May 6 /PRNewswire-FirstCall/ --



Significant Items to Report: -- Net income of $75.6 million for the first quarter of 2009, compared to a net loss of $3.4 million in the first quarter of 2008 -- Adjusted EBITDA of $50.1 million for the first quarter of 2009, an increase of $35.2 million over the first quarter of 2008 -- Distributable cash flow of $38.9 million for the first quarter of 2009, an increase of $25.7 million over first quarter of 2008 -- Declared a quarterly cash distribution of $0.45 per unit on all outstanding units. -- Increased Shreveport refinery average throughput by approximately 11,500 bpd to approximately 45,500 bpd, a 34% increase over the fourth quarter of 2008

Calumet Specialty Products Partners, L.P. (the "Partnership" or "Calumet") reported net income for the quarter ended March 31, 2009 of $75.6 million, an increase of $79.0 million over the first quarter of 2008, due primarily to an increase of $44.1 million in gross profit and increased derivative gains of $30.6 million. The increase in gross profit was primarily due to the significant decline in crude oil prices leading up to and sustained during the first quarter of 2009 as compared to the rapidly rising crude oil price environment in the first quarter of 2008. The increased derivative gains of $30.6 million, are comprised of changes in both non-cash gains of $36.2 million and cash losses of $5.6 million. The increase in non-cash derivative gains is primarily related to our fuel products segment and such gains either may not be realized or may be realized in different amounts upon settlement. These non-cash derivative gains are not included in our Adjusted EBITDA of $50.1 million for the first quarter of 2009.

Earnings before interest expense, taxes, depreciation and amortization ("EBITDA") and Adjusted EBITDA (as defined by the Partnership's credit agreements) were $99.7 million and $50.1 million, respectively, for the quarter ended March 31, 2009 as compared to $12.2 million and $14.9 million, respectively, for the first quarter of 2008. Distributable Cash Flow for the quarter ended March 31, 2009 was $38.9 million as compared to $13.2 million for first quarter of 2008. (See the section of this release titled "Non-GAAP Financial Measures" and the attached tables for discussion of EBITDA, Adjusted EBITDA, Distributable Cash Flow and other non-generally accepted accounting principles ("non-GAAP") financial measures, definitions of such measures and reconciliations of such measures to the comparable GAAP measures.)

Gross profit by segment for the first quarter of 2009 for specialty products and fuel products was $59.9 million and $19.1 million, respectively, compared to $22.3 million and $12.5 million, respectively, for the first quarter of 2008. As mentioned above, the increase in specialty products segment gross profit quarter over quarter was primarily due to the significant decline in crude oil prices, our primary raw material, during the first quarter of 2009. Partially offsetting the impact of lower crude oil prices was lower sales volumes in lubricating oils, solvents and waxes due to economic conditions impacting customer demand. The increase in our fuel products segment gross profit was due primarily to increased sales volume resulting from higher throughput rates at the Shreveport refinery and increased gains on derivatives offset by lower overall crack spreads in the first quarter of 2009 compared to the first quarter of 2008.

"Our proactive approach to managing our business in the current economic environment helped us to achieve good performance in the first quarter despite weaker demand for specialty products. We are attempting to offset the impacts of this weaker demand by broadening our marketing efforts and focusing on specialty product development. We continue to focus on efficient plant operations to meet current demand levels and controlling operating costs. We also plan to continue to increase throughput rates at our Shreveport refinery to more fully utilize its expanded capacity as market conditions dictate. We believe these efforts will help us to enhance our liquidity during this continued period of economic uncertainty," said Bill Grube, Calumet's CEO and President.

Quarterly...