This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.
PBF Logistics LP Common Units representing limited partner interests
Q4 2021 Earnings Conference Call
2/10/2022
spk04: Good day, everyone, and welcome to the PBF Logistics LP fourth quarter 2021 earnings conference call and webcast. At this time, all participants have been placed in a listen-only mode, and the floor will be open for your questions following management's prepared remarks. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note, this conference is being recorded. It is now my pleasure to turn the floor over to Colin Murray of Investor Relations. Sir, you may begin.
spk01: Thank you, Chamali. Good morning and welcome to today's call. With me today are Matt Lucey, Eric Young, and several other members of the partnership senior management team. If you'd like a copy of our earnings release, it is available on our website. Before we begin, I would like to direct your attention to the forward-looking statements disclaimer contained in today's press release. In summary, it outlines that statements in the press release and on this conference call that state the partnership's or management's expectations or predictions of the future. are forward-looking statements intended to be covered by the safe harbor provisions under federal securities laws. There are many factors that could cause actual results to differ from our expectations, including those we've described in our filings with the SEC. As a reminder, PBF Logistics 10-K should be available in a week's time. As noted in today's press release, we'll be using certain non-GAAP measures while describing the partnership's operating performance and financial results. For reconciliations of non-GAAP measures to the appropriate GAAP figure, please refer to the supplemental tables provided in today's release. I'll now turn the call over to Matt Lucie.
spk03: Matt Lucie Thank you, Colin. Good morning, everyone, and thank you for joining us on today's call. PBF Logistics operated well in 2021. We finished the year with another strong operational quarter and continue to deliver consistent results. We expect there are strong relationship supported by contractual revenues will continue to deliver consistent results in 2022. We expect partnership full year 2022 revenue to be approximately 320 to $340 million. Part partnership revenues reflect the lower minimum volume commitments for the East Coast rail facilities, which took effect as of January 1 of 22. The contract extension and adjusted minimum volume commitments were originally announced in February of 2019. Revenues in this range are expected to generate EBITDA of approximately $200 to $210 million. The partnership's consistent revenues and cash generations provide strong distribution coverage and the ability to continue reducing our net debt. We will remain focused on our balance sheets. In doing so, we maintain flexibility and increase our ability to potentially grow the partnership in the future. Today, we announced a distribution of 30 cents per unit. We will continue to review our distribution policy going forward with respect to company performance, market conditions, and alternate use of funds. With that, I'll turn it over to Eric.
spk00: Thank you, Matt. We reported fourth quarter net income attributable to the limited partners. of $42.3 million. Adjusted Partnership EBITDA was $60.8 million, which includes approximately $1 million of non-cash unit-based compensation and environmental remediation costs associated with the East Coast terminals, as well as a $2.8 million gain on the sale of assets. Partnership Net Income for the full year 2021 was $153.3 million, with Adjusted EBITDA of $237.7 million. During the fourth quarter, we spent roughly $1.7 million in total CapEx, including approximately $1.1 million for maintenance. In 2021, total capital expenditures were approximately $8.6 million. For 2022, we currently expect capital expenditures to be approximately $14 million, including $12 million for maintenance and $2 million of regulatory spend. We ended the quarter with approximately $430 million in liquidity after repaying an additional $25 million in debt during the fourth quarter for a total of $100 million in debt repayments in calendar 2021. Our liquidity consists of a cash balance of $34 million and just under $400 million of availability under our revolving credit facility. Net debt to annualized adjusted EBITDA was 2.4 times We expect to continue using excess cash to improve leverage ratios and strengthen the balance sheet. Consistent with our commentary on the PBF energy earnings call this morning, our near-term finance efforts are focused on a successful refinancing and long-term credit extension of the revolver and unsecured notes due in 2023. Operator, we've concluded our opening remarks and now we'll open the call for questions.
spk04: Thank you. In a moment, we will open the call to questions. If you'd like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the start keys. One moment, please, while we poll for questions. And our first question comes from the line of Spiro Dunas with Credit Suisse. Please proceed with your question.
spk02: Hi, this is Chad. I'm for Spiro. Just first question. With PBF sanctioning the renewable diesel projects and moving forward with it, I'm just wanting to get your latest thoughts on if you plan to use the PBFX entity to help fund the renewable diesel project.
spk03: Currently, I'm part of Allowable income for the MLP does not include normal diesel activities. That being said, PBFX has zero unqualified income. So there's some room for PBFX to participate in the project just using an unqualified income. But there's also the prospect that legislation can change around what was defined as qualified income. So we'll stay close to that. But, you know, that essentially summarizes where PBFX could play in it today.
spk02: Okay, thanks. That's helpful. And then just on the second question, I'm just curious. I think the 2022 EBITDA guidance implies, you know, a little more than $30 million EBITDA decline from 2021 levels. Is that just the rail contract rolling off, or are there any other factors that go into that guide?
spk00: I think the easy math is just to assume it's roughly $20 million associated with the rail step-downs. And the remainder is primarily going to be driven by the reduction, right? We've got this contract historically over the past couple years as that rolled off. There was a portion of that that hit in 2021, and that is not in existence as we sit here today in 2022.
spk02: Okay, that's helpful. Thanks for the time.
spk04: And we have... reached the end of the question and answer session. I'll now turn the call over to Matt Lucy for closed remarks.
spk03: I appreciate everyone's time today. Have a great day.
spk04: This concludes today's conference and you may disconnect your lines at this time. Thank you for your
Disclaimer