UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 
 
 
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 8, 2019
NuStar Energy L.P.
(Exact name of registrant as specified in its charter)
Delaware
001-16417
74-2956831
(State or other jurisdiction of incorporation)
(Commission File Number)
(I.R.S. Employer Identification No.)
 
 
 
 
19003 IH-10 West
San Antonio, Texas 78257
 
 
(Address of principal executive offices)
 
 
 
 
 
(210) 918-2000
 
 
(Registrant’s telephone number, including area code)
 
 
 
 
 
Not applicable
 
 
(Former name or former address, if changed since last report.)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
 
Trading Symbol(s)
 
Name of each exchange on which registered
Common units
Fixed-to-floating rate cumulative redeemable perpetual preferred units
 
NS
NSprA, NSprB and NSprC
 
New York Stock Exchange
New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).    
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
 
 
 
 
 




Item 2.02    Results of Operations and Financial Condition.

On August 8, 2019, NuStar Energy L.P., a Delaware limited partnership, issued a press release announcing financial results for the quarter ended June 30, 2019. A copy of the press release announcing the financial results is furnished with this report as Exhibit 99.01 and is incorporated herein by reference.


Item 9.01    Financial Statements and Exhibits.

(d)     Exhibits.

Exhibit Number
 
Exhibit
 
 
 
 
Press Release dated August 8, 2019.






SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
NUSTAR ENERGY L.P.
 
 
 
 
 
 
 
By:
Riverwalk Logistics, L.P.
 
 
its general partner
 
 
 
 
 
 
 
By:
NuStar GP, LLC
 
 
 
its general partner
 
 
 
 
 
Date: August 8, 2019
 
 
By:
/s/ Amy L. Perry
 
 
 
Name:
Amy L. Perry
 
 
 
Title:
Executive Vice President-Strategic Development and General Counsel



Exhibit 99.01


NuStar Energy L.P. Reports Strong Second Quarter 2019 Earnings Results

Net Income, EBITDA and DCF All Up Quarter over Quarter

Closed on Sale of St. Eustatius Terminal for $250 Million
 
Early Service of Corpus Christi Export Project is Complete and Ready for Service

Permian Crude System Volumes Currently Approaching 400,000 Barrels Per Day; Quarterly Average Up 200% Since System Acquisition in May 2017

South Texas Crude Oil Pipeline System Records Throughput Volumes Near Historical Highs

SAN ANTONIO, August 8, 2019 - NuStar Energy L.P. (NYSE: NS) NuStar Energy L.P. (NYSE: NS) reported strong second quarter 2019 earnings results, highlighted NuStar’s significant progress on its 2019 capital projects program and outlined NuStar’s expectations for the second half of 2019 and beyond.

“We generated great results this quarter,” said Brad Barron, president and chief executive officer of NuStar Energy L.P. “All our key indicators were up in the second quarter, including net income, total pipeline and storage segment revenue, earnings before interest, taxes, depreciation and amortization (EBITDA), and distributable cash flow (DCF) available to common limited partners.”

Barron noted that NuStar has continued to substantially improve its debt metrics, pointing to a second quarter 2019 Debt-to-EBITDA ratio of 3.95 times, which is a significant improvement over the 4.72 times ratio at the end of the second quarter of 2018.

“I am very pleased that we were able to close on our sale of the St. Eustatius operations at a healthy double-digit multiple in July, and that sale, along with the EBITDA improvement evident in our results for the quarter, has allowed us to lower our year-end 2019 Debt-to-EBITDA ratio projection to 4.1 times,” Barron said. “What’s more, the sale of the St. Eustatius operations not only lowered our leverage; it also simplified our business, reduced our risk profile, lowered our 2019 reliability capital, and allows us to focus 100% on our core business here in North America.”

Barron explained that the majority of NuStar’s 2019 spending is earmarked for the build-out of its Permian Crude System, as well as its projects to deploy under-utilized assets to supply refined products to Northern Mexico and its Corpus Christi export project.

He also announced that the first stage of NuStar’s Corpus export project, which utilizes its 16” pipeline in South Texas to receive and transport WTI volumes from a connection to Cactus II to its Corpus Christi export facility, is now complete and ready for service.

“We are excited to report that, starting as soon as next week, our Corpus Christi dock facility will be the first in the Port of Corpus Christi to export barrels transported to South Texas via one of three large Permian long-haul pipeline projects. The second stage of our export project, a new 8-mile 30” pipeline to








transport WTI volumes from a connection to Cactus II in Taft, Texas to our Corpus Christi terminal is also on-schedule to be in service this quarter, as are our two projects to supply refined products to Northern Mexico,” Barron said.

Commenting on the full-year and beyond, Barron said, “We expect NuStar to continue to generate solid results this year, as we continue to expect adjusted EBITDA in the range of $665-$715 million, and we expect our DCF coverage for the year to be a strong 1.3 times to 1.4 times. And in 2020, when the cash flows from our current capital projects are fully ramped up and we plan to spend significantly less strategic capital, we expect our results to be even stronger,” said Barron.

Second Quarter 2019 Results, Impact of Non-Cash Impairment and Full-Year Projections

NuStar Executive Vice President and Chief Financial Officer, Tom Shoaf, outlined NuStar’s financial results for the second quarter of 2019.

“In connection with the sale of our St. Eustatius operations to Prostar Capital, the results for the St. Eustatius operations for all periods presented in our earnings tables are now reported within discontinued operations. Further, discontinued operations for the prior year periods include the results for our European operations, which were sold in late 2018. Our reported second quarter results, which include adjusted net income, adjusted EPU, adjusted EBITDA, DCF and related metrics, include results for both continuing and discontinued operations. Excluded from these measures is a non-cash impairment charge totaling $8.4 million, related to the St. Eustatius divestiture,” Shoaf noted.

 
Three Months Ended June 30, 2019
 
Three Months Ended June 30, 2018
 
Unadjusted
 
Adjusted
 
Unadjusted
 
Adjusted
 
(thousands of dollars, except per unit data)
Net income
$
45,951

 
$
54,349

 
$
29,399

 
$
29,399

EPU
$
0.10

 
$
0.18

 
$
0.15

 
$
0.15

EBITDA
$
160,808

 
$
169,206

 
$
157,114

 
$
157,114

DCF available to common limited partners
$
89,755

 
$
89,755

 
$
82,057

 
$
82,057


“NuStar’s adjusted net income was $54 million for the second quarter of 2019, up $25 million or 85% compared to net income of $29 million for the second quarter of 2018. Second quarter 2019 adjusted earnings per unit (EPU) were $0.18 per unit, higher than EPU of $0.15 in the second quarter of 2018, even with the dilutive impact of our merger to simplify our structure and eliminate our IDRs.

“For the second quarter of 2019, we generated adjusted EBITDA of $169 million, up $12 million or 8% over second quarter 2018 EBITDA of $157 million.”
 
Shoaf also noted that NuStar’s second quarter 2019 earnings benefited from strong pipeline segment results due to the continued throughput volume ramp on its Permian Crude System, and increased crude volumes on its Ardmore system resulting from its recent connection to the Sunrise pipeline at Wichita Falls. He also stated that the storage side of NuStar’s business saw increased storage and dock fee revenues at its Corpus Christi North Beach terminal from increased quarterly volume receipts on its South Texas Crude System, as well as the start-up of revenue from some recently completed West Coast biofuel storage projects.









Shoaf went on to say that, “Second quarter 2019 distributable cash flow (DCF) available to common limited partners was $90 million, up $8 million from second quarter 2018 DCF available to common limited partners of $82 million. And he further noted that, “The distribution coverage ratio to the common limited partners was a strong 1.39 times for the second quarter of 2019.”

Conference Call Details
A conference call with management is scheduled for 10:00 a.m. CT today, August 8, 2019. The conference call may be accessed by dialing toll-free 844/889-7787, reservation passcode 9899738. International callers may access the conference call by dialing 661/378-9931, reservation passcode 9899738. The Partnership intends to have a playback available following the conference call, which may be accessed by dialing toll-free 855/859-2056, reservation passcode 9899738. International callers may access the playback by dialing 404/537-3406, reservation passcode 9899738. The playback will be available until 1:00 p.m. CT on September 7, 2019.

Investors interested in listening to the live discussion or a replay via the internet may access the discussion directly at https://edge.media-server.com/mmc/p/eiae9hed or by logging on to NuStar Energy L.P.’s website at www.nustarenergy.com .

The discussion will disclose certain non-GAAP financial measures. Reconciliations of certain of these non-GAAP financial measures to U.S. GAAP may be found in this press release, with additional reconciliations located on the Financials page of the Investors section of NuStar Energy L.P.’s website at www.nustarenergy.com .

NuStar Energy L.P., a publicly traded master limited partnership based in San Antonio, is one of the largest independent liquids terminal and pipeline operators in the nation. NuStar currently has approximately 9,800 miles of pipeline and 74 terminal and storage facilities that store and distribute crude oil, refined products and specialty liquids. The partnership’s combined system has approximately 74 million barrels of storage capacity, and NuStar has operations in the United States, Canada and Mexico. For more information, visit NuStar Energy L.P.’s website at www.nustarenergy.com .

Cautionary Statement Regarding Forward-Looking Statements

This press release includes, and the related conference call will include, forward-looking statements regarding future events, such as the partnership’s future performance. All forward-looking statements are based on the partnership’s beliefs as well as assumptions made by and information currently available to the partnership. These statements reflect the partnership’s current views with respect to future events and are subject to various risks, uncertainties and assumptions. These risks, uncertainties and assumptions are discussed in NuStar Energy L.P.’s 2018 annual report on Form 10-K and subsequent filings with the Securities and Exchange Commission. Actual results may differ materially from those described in the forward-looking statements.




NuStar Energy L.P. and Subsidiaries
Consolidated Financial Information
(Unaudited, Thousands of Dollars, Except Unit and Per Unit Data)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019

2018
 
2019
 
2018
Statement of Income Data:
 
 
 
 
 
 
 
Revenues:
 
 
 
 
 
 
 
Service revenues
$
282,472

 
$
259,599

 
$
541,499

 
$
507,668

Product sales
89,973

 
129,657

 
178,772

 
258,315

Total revenues
372,445

 
389,256

 
720,271

 
765,983

Costs and expenses:
 
 
 
 
 
 
 
Costs associated with service revenues:
 
 
 
 
 
 
 
Operating expenses
101,095

 
102,241

 
196,506

 
190,320

Depreciation and amortization expense
64,991

 
61,777

 
129,809

 
121,601

Total costs associated with service revenues
166,086

 
164,018

 
326,315

 
311,921

Cost of product sales
86,389

 
119,939

 
172,571

 
245,089

General and administrative expenses
24,868

 
26,754

 
50,559

 
44,896

Other depreciation and amortization expense
1,819

 
2,158

 
3,938

 
4,197

Total costs and expenses
279,162


312,869


553,383


606,103

Operating income
93,283

 
76,387

 
166,888

 
159,880

Interest expense, net
(45,693
)
 
(48,389
)
 
(89,984
)
 
(95,777
)
Other income, net
621

 
1,607

 
1,412

 
2,623

Income from continuing operations before income tax expense
48,211

 
29,605

 
78,316

 
66,726

Income tax expense
1,296

 
2,696

 
2,478

 
6,584

Income from continuing operations, net of tax
46,915

 
26,909

 
75,838

 
60,142

(Loss) income from discontinued operations, net of tax
(964
)
 
2,490

 
(307,750
)
 
95,390

Net income (loss)
$
45,951

 
$
29,399

 
$
(231,912
)
 
$
155,532

 
 
 
 
 
 
 
 
Basic net income (loss) per common unit:
 
 
 
 
 
 
 
Continuing operations
$
0.11

 
$
0.12

 
$
0.05

 
$
0.30

Discontinued operations
(0.01
)
 
0.03

 
(2.86
)
 
1.00

Total net income (loss) per common unit
$
0.10

 
$
0.15

 
$
(2.81
)
 
$
1.30

 
 
 
 
 
 
 
 
Basic weighted-average common units outstanding
107,763,016

 
93,192,238

 
107,647,957

 
93,187,038

 
 
 
 
 
 
 
 
Other Data:
 
 
 
 
 
 
 
EBITDA (Note 1)
$
160,808

 
$
157,114

 
$
2,902

 
$
407,361

DCF available to common limited partners (Note 1)
$
89,755

 
$
82,057

 
$
184,806

 
$
173,789

Adjusted EBITDA (Note 2)
$
169,206

 
$
157,114

 
$
339,740

 
$
328,605

Adjusted net income (Note 3)
$
54,349

 
$
29,399

 
$
104,926

 
$
76,776

Adjusted EPU (Note 3)
$
0.18

 
$
0.15

 
$
0.32

 
$
0.48

 
June 30,
 
December 31,
 
2019
 
2018
 
2018
Balance Sheet Data:
 
 
 
 
 
 Total debt
$
3,466,548

 
$
3,443,366

 
$
3,130,496

 Partners’ equity and series D preferred units
$
2,401,900

 
$
2,827,188

 
$
2,821,723




NuStar Energy L.P. and Subsidiaries
Consolidated Financial Information - Continued
(Unaudited, Thousands of Dollars, Except Barrel Data)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019

2018
 
2019
 
2018
Pipeline:
 
 
 
 
 
 
 
Crude oil pipelines throughput (barrels/day)
1,089,848

 
839,574

 
1,054,425

 
815,568

Refined products and ammonia pipelines throughput
(barrels/day)
569,820

 
565,740

 
536,836

 
548,910

Total throughput (barrels/day)
1,659,668

 
1,405,314


1,591,261


1,364,478

Throughput and other revenues
$
172,493

 
$
150,276

 
$
328,744

 
$
287,066

Operating expenses
52,930

 
48,706

 
101,028

 
91,047

Depreciation and amortization expense
40,851

 
38,591

 
81,700

 
75,246

Segment operating income
$
78,712


$
62,979

 
$
146,016

 
$
120,773

Storage:
 
 
 
 
 
 
 
Throughput (barrels/day)
395,512

 
331,917

 
380,267

 
337,892

Throughput terminal revenues
$
23,170

 
$
20,141

 
$
44,856

 
$
40,157

Storage terminal revenues
87,233

 
94,679

 
169,047

 
186,083

Total revenues
110,403

 
114,820

 
213,903

 
226,240

Operating expenses
48,165

 
52,853

 
95,478

 
98,017

Depreciation and amortization expense
24,140

 
23,186

 
48,109

 
46,355

Segment operating income
$
38,098

 
$
38,781

 
$
70,316

 
$
81,868

Fuels Marketing:
 
 
 
 
 
 
 
Product sales
$
89,549

 
$
124,293

 
$
177,628

 
$
252,951

Cost of goods
85,802

 
119,942

 
171,303

 
245,107

Gross margin
3,747

 
4,351

 
6,325

 
7,844

Operating expenses
587

 
815

 
1,240

 
1,512

Segment operating income
$
3,160

 
$
3,536

 
$
5,085

 
$
6,332

Consolidation and Intersegment Eliminations:
 
 
 
 
 
 
 
Revenues
$

 
$
(133
)
 
$
(4
)
 
$
(274
)
Cost of goods

 
(3
)
 
28

 
(18
)
Operating expenses

 
(133
)
 

 
(256
)
Total
$

 
$
3

 
$
(32
)
 
$

Consolidated Information:
 
 
 
 
 
 
 
Revenues
$
372,445

 
$
389,256

 
$
720,271

 
$
765,983

Costs associated with service revenues:
 
 
 
 
 
 
 
Operating expenses
101,095

 
102,241

 
196,506

 
190,320

Depreciation and amortization expense
64,991

 
61,777

 
129,809

 
121,601

Total costs associated with service revenues
166,086

 
164,018

 
326,315

 
311,921

Cost of product sales
86,389

 
119,939

 
172,571

 
245,089

Segment operating income
119,970

 
105,299

 
221,385

 
208,973

General and administrative expenses
24,868

 
26,754

 
50,559

 
44,896

Other depreciation and amortization expense
1,819

 
2,158

 
3,938

 
4,197

Consolidated operating income
$
93,283

 
$
76,387


$
166,888


$
159,880




NuStar Energy L.P. and Subsidiaries
Consolidated Financial Information - Continued
(Unaudited, Thousands of Dollars, Except Ratio Data)
Note 1: NuStar Energy L.P. utilizes financial measures, such as earnings before interest, taxes, depreciation and amortization (EBITDA), distributable cash flow (DCF) and distribution coverage ratio, which are not defined in U.S. generally accepted accounting principles (GAAP). Management believes these financial measures provide useful information to investors and other external users of our financial information because (i) they provide additional information about the operating performance of the partnership’s assets and the cash the business is generating, (ii) investors and other external users of our financial statements benefit from having access to the same financial measures being utilized by management and our board of directors when making financial, operational, compensation and planning decisions and (iii) they highlight the impact of significant transactions. We also use adjusted measures of net income, net income per common unit and EBITDA, which are not defined in GAAP, to enhance the comparability of performance across periods.
Our board of directors and management use EBITDA and/or DCF when assessing the following: (i) the performance of our assets, (ii) the viability of potential projects, (iii) our ability to fund distributions, (iv) our ability to fund capital expenditures and (v) our ability to service debt. In addition, our board of directors uses a distribution coverage ratio, which is calculated based on DCF, as one of the factors in its compensation determinations. DCF is a widely accepted financial indicator used by the master limited partnership (MLP) investment community to compare partnership performance. DCF is used by the MLP investment community, in part, because the value of a partnership unit is partially based on its yield, and its yield is based on the cash distributions a partnership can pay its unitholders.
None of these financial measures are presented as an alternative to net income. They should not be considered in isolation or as substitutes for a measure of performance prepared in accordance with GAAP. The following is a reconciliation of net income (loss) to EBITDA, DCF and distribution coverage ratio; therefore, the reconciling items include activity from continuing and discontinued operations on a combined basis.
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019
 
2018
 
2019
 
2018
Net income (loss)
$
45,951

 
$
29,399

 
$
(231,912
)
 
$
155,532

Interest expense, net
45,684

 
48,936

 
89,952

 
96,708

Income tax expense
1,296

 
2,915

 
2,579

 
7,242

Depreciation and amortization expense
67,877

 
75,864

 
142,283

 
147,879

EBITDA
160,808

 
157,114

 
2,902

 
407,361

Interest expense, net
(45,684
)
 
(48,936
)
 
(89,952
)
 
(96,708
)
Reliability capital expenditures
(17,632
)
 
(21,913
)
 
(27,176
)
 
(41,795
)
Income tax expense
(1,296
)
 
(2,915
)
 
(2,579
)
 
(7,242
)
Long-term incentive equity awards (a)
2,168

 
1,783

 
4,535

 
3,120

Preferred unit distributions
(30,423
)
 
(16,245
)
 
(60,846
)
 
(32,235
)
Insurance gain adjustment (b)
10,379

 
10,609

 
15,512

 
(55,753
)
Impairment losses (c)
8,398

 

 
336,838

 

Other items
3,037

 
2,560

 
5,572

 
(1,818
)
DCF
$
89,755

 
$
82,057

 
$
184,806

 
$
174,930

Less DCF available to general partner

 

 

 
1,141

DCF available to common limited partners
$
89,755

 
$
82,057

 
$
184,806

 
$
173,789

 
 
 
 
 
 
 
 
Distributions applicable to common limited partners
$
64,658

 
$
64,205

 
$
129,348

 
$
120,121

Distribution coverage ratio (d)
1.39x

 
1.28x

 
1.43x

 
1.45x

Continued on following page.








NuStar Energy L.P. and Subsidiaries
Consolidated Financial Information - Continued
(Unaudited, Thousands of Dollars, Except Ratio Data)
 
Projected for the Year Ended December 31, 2019
Net loss
$ (127,000 - 102,000)

Interest expense, net
180,000 - 190,000

Income tax expense
5,000 - 10,000

Depreciation and amortization expense
270,000 - 280,000

EBITDA
328,000 - 378,000

Interest expense, net
(180,000) - (190,000)

Reliability capital expenditures
(60,000) - (80,000)

Income tax expense
(5,000) - (10,000)

Long-term incentive equity awards (a)
5,000 - 10,000

Preferred unit distributions
(120,000) - (125,000)

Insurance gain adjustment (b)
15,000 - 20,000

Impairment losses (c)
337,000

Other items
5,000 - 15,000

DCF available to common limited partners
$ 325,000 - 355,000

 
 
Distributions applicable to common limited partners
$ 255,000 - 260,000

Distribution coverage ratio (d)
1.3x - 1.4x


(a)
We intend to satisfy the vestings of these equity-based awards with the issuance of our common units. As such, the expenses related to these awards are considered non-cash and added back to DCF. Certain awards include distribution equivalent rights (DERs). Payments made in connection with DERs are deducted from DCF.
(b)
For the six months ended June 30, 2018, DCF includes an adjustment for insurance proceeds received related to hurricane damage at our St. Eustatius terminal. Each quarter we add an amount to DCF to offset the amount of reliability capital expenditures incurred related to hurricane damage.
(c)
Represents non-cash impairment losses associated with long-lived assets and goodwill at our St. Eustatius terminal.
(d)
Distribution coverage ratio is calculated by dividing DCF available to common limited partners by distributions applicable to common limited partners.

Note 2: The following is a reconciliation of EBITDA to adjusted EBITDA:
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
Projected for the Year Ended December 31, 2019
 
2019
 
2018
 
2019
 
2018
 
EBITDA
$
160,808


$
157,114


$
2,902


$
407,361

 
$ 328,000 - 378,000

Impairment losses
8,398

 

 
336,838

 

 
337,000

Gain from hurricane insurance proceeds

 

 

 
(78,756
)
 

Adjusted EBITDA
$
169,206

 
$
157,114


$
339,740


$
328,605

 
$ 665,000 - 715,000





NuStar Energy L.P. and Subsidiaries
Consolidated Financial Information - Continued
(Unaudited, Thousands of Dollars, Except Per Unit Data)

Note 3: The following is a reconciliation of net income (loss) and net income (loss) per common unit to adjusted net income applicable to common limited partners and adjusted net income per common unit:
 
Three Months Ended June 30,
 
2019
 
2018
Net income / net income per common unit
$
45,951

 
$
0.10

 
$
29,399

 
$
0.15

Impairment loss
8,398

 
0.08

 

 

Adjusted net income
54,349

 
 
 
29,399

 
 
Net income applicable to preferred limited partners,
general partner and other
(35,511
)
 
 
 
(15,694
)
 
 
Adjusted net income applicable to common limited partners /
adjusted net income per common unit
$
18,838

 
$
0.18

 
$
13,705

 
$
0.15

 
Six Months Ended June 30,
 
2019
 
2018
Net (loss) income / net (loss) income per common unit
$
(231,912
)
 
$
(2.81
)
 
$
155,532

 
$
1.30

Impairment losses
336,838

 
3.13

 

 

Gain from hurricane insurance proceeds

 

 
(78,756
)
 
(0.82
)
Adjusted net income
104,926

 
 
 
76,776

 
 
Net income applicable to preferred limited partners,
general partner and other
(70,879
)
 
 
 
(32,748
)
 
 
Adjusted net income applicable to common limited partners /
adjusted net income per common unit
$
34,047

 
$
0.32

 
$
44,028

 
$
0.48








NuStar Energy L.P. and Subsidiaries
Consolidated Financial Information - Continued
(Unaudited, Thousands of Dollars, Except Ratio Data)


Note 4: The following is the reconciliation for the calculation of our Consolidated Debt Coverage Ratio, as defined in our revolving credit agreement (the Revolving Credit Agreement):
 
For the Four Quarters Ended June 30,
 
Projected for the
Year Ended December 31, 2019
 
2019
 
2018
 
Net (loss) income
$
(181,650
)
 
$
219,306

 
$ (127,000 - 102,000)

Interest expense, net
179,481

 
187,765

 
180,000 - 190,000

Income tax expense
6,745

 
12,624

 
5,000 - 10,000

Depreciation and amortization expense
292,278

 
287,646

 
270,000 - 280,000

EBITDA
296,854

 
707,341

 
328,000 - 378,000

Impairment losses (a)
336,838

 

 

Other expense (income) (b)
38,709

 
(75,642
)
 

Equity awards (c)
12,140

 
7,292

 
5,000 - 10,000

Pro forma effect of disposition (d)
(7,638
)
 

 
295,000 - 305,000

Material project adjustments and other items (e)
79,901

 
(1,637
)
 
50,000 - 70,000

Consolidated EBITDA, as defined in the Revolving Credit
Agreement
$
756,804

 
$
637,354

 
$ 678,000 - 763,000

 
 
 
 
 
 
Total consolidated debt
$
3,429,740

 
$
3,454,998

 
$ 3,250,000 - 3,550,000

NuStar Logistics' floating rate subordinated notes
(402,500
)
 
(402,500
)
 
(402,500
)
Proceeds held in escrow associated with the Gulf
Opportunity Zone Revenue Bonds
(41,476
)
 
(41,476
)
 
(41,500
)
Consolidated Debt, as defined in the Revolving Credit Agreement
$
2,985,764

 
$
3,011,022

 
$ 2,806,000 - 3,106,000

 
 
 
 
 
 
Consolidated Debt Coverage Ratio (Consolidated Debt to
Consolidated EBITDA)
3.95x

 
4.72x

 
4.1x

(a) Represents non-cash impairment losses associated with long-lived assets and goodwill at our St. Eustatius terminal.
(b) Other expense is excluded for purposes of calculating Consolidated EBITDA, as defined in the Revolving Credit Agreement.
(c) This adjustment represents the non-cash expense related to the vestings of equity-based awards with the issuance of our common units.
(d) For the four quarters ended June 30, 2018, this adjustment represents the pro forma effects of the sale of our European operations as if we had completed the sale on January 1, 2018. For the year ended December 31, 2019, this adjustment represents the pro forma effects of the sale of our St. Eustatius operations as if we had completed the sale on January 1, 2019.
(e) This adjustment represents the percentage of the projected Consolidated EBITDA attributable to any Material Project and other noncash items, as defined in the Revolving Credit Agreement.