Natural Resource Partners L.P. Reports Second Quarter 2019 Results

HOUSTON--()--Natural Resource Partners L.P. (NYSE:NRP) today reported second quarter 2019 results as follows:

 

 

Three Months Ended

 

Last Twelve Months

 

 

June 30,

 

June 30,

(In thousands) (Unaudited)

 

 

2019

 

 

 

2018

 

 

 

2019

 

Net income from continuing operations

 

$

 

 

19,106

 

 

$

 

 

35,129

 

 

$

 

115,816

 

Adjusted EBITDA (1)

 

 

62,791

 

 

 

53,091

 

 

 

240,183

 

Cash flow provided by (used in) continuing operations:

 

 

 

 

 

 

Operating activities

 

 

53,359

 

 

 

53,893

 

 

 

183,166

 

Investing activities

 

 

698

 

 

 

699

 

 

 

5,063

 

Financing activities

 

 

(97,989

)

 

 

(24,053

)

 

 

(153,783

)

Distributable cash flow (1)

 

 

54,013

 

 

 

54,592

 

 

 

385,886

 

Free cash flow (1)

 

 

53,810

 

 

 

54,422

 

 

 

186,103

 

Cash flow cushion (last twelve months) (1)

 

 

 

 

 

 

26,137

 

________________

(1)

 

See "Non-GAAP Financial Measures" and reconciliation tables at the end of this release.

"NRP continued to generate a steady stream of cash flow during the second quarter," stated Craig Nunez, NRP's President and Chief Operating Officer. "In addition, we further strengthened our balance sheet during the quarter by extending our $100 million revolving credit facility from 2020 to 2023 and by redeeming all of our $346 million of 10.50% bonds due 2022 through the issuance of $300 million of 9.125% bonds due 2025. During the first six months of 2019, we lowered our debt by $134 million and we continue to remain focused on free cash flow generation, return on capital employed and further de-leveraging and de-risking the Partnership.”

NRP's liquidity was $185.8 million at June 30, 2019, consisting of $70.9 million of cash, $14.9 million of cash restricted for debt repayment and $100.0 million of borrowing capacity available under its revolving credit facility. At June 30, 2019, NRP's consolidated Debt-to-Adjusted EBITDA ratio excluding the one-time beneficial Hillsboro settlement in the fourth quarter of 2018 was 2.6x.

NRP's cash flow cushion for the last twelve months ended June 30, 2019, was $26.1 million. Cash flow cushion represents the amount of free cash flow left over after payment of mandatory debt amortizations and preferred and common unit distributions. NRP remains focused on this metric to preserve financial flexibility needed to weather changes in market conditions while continuing to service its debt obligations and make distributions to unitholders.

NRP declared a cash distribution of $0.45 per common unit and a cash distribution of $7.5 million on NRP’s preferred units for the second quarter of 2019.

Second Quarter Segment Results

 

 

Operating Business Segments

 

 

 

 

 

 

Coal Royalty
and Other

 

Soda Ash

 

Corporate and
Financing

 

Total

(In thousands) (Unaudited)

 

 

 

 

Three Months Ended June 30, 2019

 

 

 

 

 

 

 

 

Net income (loss) from continuing operations

 

$

 

 

53,707

 

 

$

 

 

11,333

 

 

$

 

 

(45,934

)

 

$

 

 

19,106

 

Adjusted EBITDA (1)

 

 

57,677

 

 

 

9,310

 

 

 

(4,196

)

 

 

62,791

 

Cash flow provided by (used in) continuing operations:

 

 

 

 

 

 

 

 

Operating activities

 

 

55,811

 

 

 

9,310

 

 

 

(11,762

)

 

 

53,359

 

Investing activities

 

 

698

 

 

 

 

 

 

 

698

 

Financing activities

 

 

 

 

 

 

(97,989

)

 

 

(97,989

)

Distributable cash flow (1) (2)

 

 

56,509

 

 

 

9,310

 

 

 

(11,762

)

 

 

54,013

 

Free cash flow (1)

 

 

56,262

 

 

 

9,310

 

 

 

(11,762

)

 

 

53,810

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2018

 

 

 

 

 

 

 

 

Net income (loss) from continuing operations

 

$

 

 

39,597

 

 

$

 

 

16,529

 

 

$

 

 

(20,997

)

 

$

 

 

35,129

 

Adjusted EBITDA (1)

 

 

44,104

 

 

 

12,250

 

 

 

(3,263

)

 

 

53,091

 

Cash flow provided by (used in) continuing operations:

 

 

 

 

 

 

 

 

Operating activities

 

 

51,725

 

 

 

12,250

 

 

 

(10,082

)

 

 

53,893

 

Investing activities

 

 

699

 

 

 

 

 

 

 

699

 

Financing activities

 

 

 

 

 

 

(24,053

)

 

 

(24,053

)

Distributable cash flow (1)

 

 

52,424

 

 

 

12,250

 

 

 

(10,082

)

 

 

54,592

 

Free cash flow (1)

 

 

52,254

 

 

 

12,250

 

 

 

(10,082

)

 

 

54,422

 

________________

(1)

See "Non-GAAP Financial Measures" and reconciliation tables at the end of this release.

(2)

Includes adjustments of net proceeds from the sale of the construction aggregates business which are classified as investing cash flow from discontinued operations

Coal Royalty and Other

Increases in second quarter performance compared to the prior year quarter were primarily due to:

  • $13.9 million increased production lease minimum revenues primarily as a result of increased lessee forfeitures of recoupable balances from minimums paid in prior periods.
  • $4.4 million of lease amendment revenues during the second quarter of 2019.
  • $3.3 million increased minimum lease straight-line revenues primarily related to the Hillsboro property that NRP began to recognize in 2019 after completion of the Hillsboro litigation settlement with Foresight.

These increases were partially offset by a $4.1 million decrease in coal royalty revenues driven by lower sales volumes from the idling of the Pinnacle mine in the fourth quarter of 2018, logistical issues in the Illinois Basin caused by flooding and high water throughout the river systems and the timing of mining on NRP's Northern Powder River Basin property. In addition, operating and maintenance expenses within the segment increased $4.3 million primarily due to bad debt expense recognized in the second quarter of 2019 related to certain receivables.

NRP continued to see solid pricing for metallurgical coal due to sustained global steel demand, as well as steady pricing for thermal coal as a result of NRP lessees locking-in favorable pricing for the first half of 2019. Approximately 70% of NRP's coal royalty revenues and approximately 50% of its coal royalty sales volumes was derived from metallurgical coal during the three months ended June 30, 2019.

Soda Ash

Net income decreased due to Ciner Wyoming's litigation settlement of a royalty dispute that resulted in $12.7 million of income in the second quarter of 2018. Excluding the impact of this litigation settlement, net income increased $7.5 million compared to the prior year quarter driven by increased production and sales volumes and increased domestic and international sales prices.

Adjusted EBITDA, Distributable cash flow and Free cash flow decreased $2.9 million due to lower second quarter cash distributions received from Ciner Wyoming. The managing partner of NRP's Ciner Wyoming joint venture has announced plans for a major capacity expansion project and a multi-year reduction in cash distributions, with the cash retained at the JV used to fund a portion of the expansion capital cost. The cash distributions NRP has received from Ciner Wyoming over the last two years have averaged $45 million annually. Starting this month, NRP expects for the cash distributions it receives from Ciner Wyoming to decrease to approximately $25 million to $28 million per year and be held at such levels for the next two to three years. This expansion project is intended to provide significant increases in production capacity, free cash flow and cash distributions to NRP over the long term.

Corporate and Financing

Corporate and Financing costs increased as compared to the prior year quarter primarily driven by the refinancing and extension of both NRP's bonds and revolving credit facility in the second quarter of 2019 that resulted in a $29.3 million loss on extinguishment of debt. Additionally, Cash flow used in financing activities increased primarily as a result of the use of cash on hand to reduce the principal of NRP’s bonds by $46 million and to pay financing costs that included an $18 million call option premium related to the redemption of the $346 million bonds.

Conference Call

A conference call will be held today at 10:00 a.m. ET. To join the conference call, dial (844) 379-6938 and provide the conference code 55454893. Investors may also listen to the call via the Investor Relations section of the NRP website at www.nrplp.com. To access the replay, please visit the Investor Relations section of NRP’s website.

Company Profile

Natural Resource Partners L.P., a master limited partnership headquartered in Houston, TX, is a diversified natural resource company that owns, manages and leases a diversified portfolio of mineral properties in the United States including interests in coal, industrial minerals and other natural resources. A large percentage of NRP's revenues are generated from royalties and other passive income. In addition, NRP owns an equity investment in Ciner Wyoming LLC, a trona ore mining and soda ash production business.

For additional information, please contact Tiffany Sammis at 713-751-7515 or tsammis@nrplp.com. Further information about NRP is available on the partnership’s website at http://www.nrplp.com.

Forward-Looking Statements

This press release includes “forward-looking statements” as defined by the Securities and Exchange Commission. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Partnership expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements are based on certain assumptions made by the Partnership based on its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Partnership. These risks include, among other things, statements regarding: the Partnership's business strategy; its liquidity and access to capital and financing sources; its financial strategy; prices of and demand for coal, trona and soda ash, and other natural resources; estimated revenues, expenses and results of operations; projected production levels by the Partnership's lessees; Ciner Wyoming LLC’s trona mining and soda ash refinery operations; distributions from the soda ash joint venture; the impact of governmental policies, laws and regulations, as well as regulatory and legal proceedings involving the Partnership, and of scheduled or potential regulatory or legal changes; global and U.S. economic conditions; and other factors detailed in Natural Resource Partners’ Securities and Exchange Commission filings. Natural Resource Partners L.P. has no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Measures

"Adjusted EBITDA" is a non-GAAP financial measure that we define as net income (loss) from continuing operations less equity earnings from unconsolidated investment, net income attributable to non-controlling interest and gain on reserve swap; plus total distributions from unconsolidated investment, interest expense, net, debt modification expense, loss on extinguishment of debt, depreciation, depletion and amortization and asset impairments. Adjusted EBITDA should not be considered an alternative to, or more meaningful than, net income or loss, net income or loss attributable to partners, operating income, cash flows from operating activities or any other measure of financial performance presented in accordance with GAAP as measures of operating performance, liquidity or ability to service debt obligations. There are significant limitations to using Adjusted EBITDA as a measure of performance, including the inability to analyze the effect of certain recurring items that materially affect our net income (loss), the lack of comparability of results of operations of different companies and the different methods of calculating Adjusted EBITDA reported by different companies. In addition, Adjusted EBITDA presented below is not calculated or presented on the same basis as Consolidated EBITDA as defined in our partnership agreement or Consolidated EBITDDA as defined in Opco's debt agreements. Adjusted EBITDA is a supplemental performance measure used by our management and by external users of our financial statements, such as investors, commercial banks, research analysts and others to assess the financial performance of our assets without regard to financing methods, capital structure or historical cost basis.

“Distributable cash flow” or "DCF" is a non-GAAP financial measure that we define as net cash provided by (used in) operating activities of continuing operations plus distributions from unconsolidated investment in excess of cumulative earnings, proceeds from sales of assets, including sales of discontinued operations, and return of long-term contract receivables (including affiliate); less maintenance capital expenditures and distributions to non-controlling interest. DCF is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing or financing activities. DCF may not be calculated the same for us as for other companies. In addition, Distributable cash flow is not calculated or presented on the same basis as distributable cash flow as defined in our partnership agreement, which is used as a metric to determine whether we are able to increase quarterly distributions to our common unitholders. Distributable cash flow is a supplemental liquidity measure used by our management and by external users of our financial statements, such as investors, commercial banks, research analysts and others to assess our ability to make cash distributions and repay debt.

“Free cash flow” or "FCF" is a non-GAAP financial measure that we define as net cash provided by (used in) operating activities of continuing operations plus distributions from unconsolidated investment in excess of cumulative earnings and return of long-term contract receivables (including affiliate); less maintenance and expansion capital expenditures, cash flow used in acquisition costs classified as financing activities and distributions to non-controlling interest. FCF is calculated before mandatory debt repayments. Free cash flow is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing or financing activities. Free cash flow may not be calculated the same for us as for other companies. Free cash flow is a supplemental liquidity measure used by our management and by external users of our financial statements, such as investors, commercial banks, research analysts and others to assess our ability to make cash distributions and repay debt.

“Free cash flow excluding discontinued operations and one-time beneficial items” is a non-GAAP financial measure that we define as Free cash flow excluding discontinued operations and one-time beneficial items. Free cash flow excluding discontinued operations and one-time beneficial items is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing or financing activities. Free cash flow excluding discontinued operations and one-time beneficial items may not be calculated the same for us as for other companies. Free cash flow excluding discontinued operations and one-time beneficial items is a supplemental liquidity measure used by our management to assess our ability to make cash distributions and repay debt.

"Cash flow cushion" is a non-GAAP financial measure that we define as Free cash flow less one-time beneficial items, mandatory Opco debt amortization payments, preferred unit distributions and common unit distributions. Cash flow cushion is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing or financing activities. Cash flow cushion is a supplemental liquidity measure used by our management to assess the Partnership's ability to make or raise cash distributions to our common and preferred unitholders and our general partner and repay debt or redeem preferred units.

"Return on capital employed" or "ROCE" is a non-GAAP financial measure that we define as Net income from continuing operations plus financing costs (interest expense plus loss on extinguishment of debt) divided by the sum of equity excluding equity of discontinued operations, and debt. Return on capital employed should not be considered an alternative to, or more meaningful than, net income or loss, net income or loss attributable to partners, operating income, cash flows from operating activities or any other measure of financial performance presented in accordance with GAAP as measures of operating performance, liquidity or ability to service debt obligations. Return on capital employed is a supplemental performance measure used by our management team that measures our profitability and efficiency with which our capital is employed. The measure provides an indication of operating performance before the impact of leverage in the capital structure.

"Return on capital employed excluding discontinued operations and one-time beneficial items" is a non-GAAP financial measure that we define as Return on capital employed excluding one-time beneficial items. Return on capital employed excluding discontinued operations and one-time beneficial items should not be considered an alternative to, or more meaningful than, net income or loss, net income or loss attributable to partners, operating income, cash flows from operating activities or any other measure of financial performance presented in accordance with GAAP as measures of operating performance, liquidity or ability to service debt obligations. Return on capital employed excluding discontinued operations and one-time beneficial items is a supplemental performance measure used by our management team that measures our profitability and efficiency with which our capital is employed excluding the impact of one-time beneficial items. The measure provides an indication of operating performance before the impact of leverage in the capital structure and excluding the impact of one-time beneficial items.

-Financial Tables and Reconciliation of Non-GAAP Measures Follow-

Natural Resource Partners L.P.

Financial Tables

(Unaudited)

 

Consolidated Statements of Comprehensive Income

 

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

March 31,

 

June 30,

(In thousands, except per unit data)

2019

 

2018

 

2019

 

2019

 

2018

Revenues and other income

 

 

 

 

 

 

 

 

 

Coal royalty and other

$

 

64,616

 

 

$

 

47,920

 

 

$

 

49,502

 

 

$

 

114,118

 

 

$

 

92,394

 

Transportation and processing services

 

5,274

 

 

 

5,002

 

 

 

5,601

 

 

 

10,875

 

 

 

10,385

 

Equity in earnings of Ciner Wyoming

 

11,333

 

 

 

16,529

 

 

 

11,682

 

 

 

23,015

 

 

 

26,150

 

Gain on asset sales

 

246

 

 

 

168

 

 

 

256

 

 

 

502

 

 

 

819

 

Total revenues and other income

$

 

81,469

 

 

$

 

69,619

 

 

$

 

67,041

 

 

$

 

148,510

 

 

$

 

129,748

 

Operating expenses

 

 

 

 

 

 

 

 

 

Operating and maintenance expenses

$

 

12,459

 

 

$

 

8,117

 

 

$

 

8,360

 

 

$

 

20,819

 

 

$

 

14,332

 

Depreciation, depletion and amortization

 

3,970

 

 

 

5,376

 

 

 

4,392

 

 

 

8,362

 

 

 

10,476

 

General and administrative expenses

 

4,196

 

 

 

3,263

 

 

 

4,350

 

 

 

8,546

 

 

 

7,599

 

Asset impairments

 

 

 

 

 

 

 

 

 

242

 

Total operating expenses

$

 

20,625

 

 

$

 

16,756

 

 

$

 

17,102

 

 

$

 

37,727

 

 

$

 

32,649

 

 

 

 

 

 

 

 

 

 

 

Income from operations

$

 

60,844

 

 

$

 

52,863

 

 

$

 

49,939

 

 

$

 

110,783

 

 

$

 

97,099

 

Other expenses, net

 

 

 

 

 

 

 

 

 

Interest expense, net

$

 

(12,456

)

 

$

 

(17,734

)

 

$

 

(14,174

)

 

$

 

(26,630

)

 

$

 

(35,684

)

Loss on extinguishment of debt

 

(29,282

)

 

 

 

 

 

 

(29,282

)

 

 

Total other expenses, net

$

 

(41,738

)

 

$

 

(17,734

)

 

$

 

(14,174

)

 

$

 

(55,912

)

 

$

 

(35,684

)

Net income from continuing operations

$

 

19,106

 

 

$

 

35,129

 

 

$

 

35,765

 

 

$

 

54,871

 

 

$

 

61,415

 

Income (loss) from discontinued operations

 

245

 

 

 

2,981

 

 

 

(46

)

 

 

199

 

 

 

1,033

 

Net income

$

 

19,351

 

 

$

 

38,110

 

 

$

 

35,719

 

 

$

 

55,070

 

 

$

 

62,448

 

Net income attributable to non-controlling interest

 

 

 

(869

)

 

 

 

 

 

 

(869

)

Net income attributable to NRP

$

 

19,351

 

 

$

 

37,241

 

 

$

 

35,719

 

 

$

 

55,070

 

 

$

 

61,579

 

Less: income attributable to preferred unitholders

 

(7,500

)

 

 

(7,500

)

 

 

(7,500

)

 

 

(15,000

)

 

 

(15,000

)

Net income attributable to common unitholders and general partner

$

 

11,851

 

 

$

 

29,741

 

 

$

 

28,219

 

 

$

 

40,070

 

 

$

 

46,579

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to common unitholders

$

 

11,614

 

 

$

 

29,146

 

 

$

 

27,655

 

 

$

 

39,269

 

 

$

 

45,647

 

Net income attributable to the general partner

 

237

 

 

 

595

 

 

 

564

 

 

 

801

 

 

 

932

 

Income from continuing operations per common unit

 

 

 

 

 

 

 

 

 

Basic

$

 

0.93

 

 

$

 

2.14

 

 

$

 

2.26

 

 

$

 

3.19

 

 

$

 

3.65

 

Diluted

 

0.85

 

 

 

1.57

 

 

 

1.75

 

 

 

2.58

 

 

 

2.78

 

Net income per common unit

 

 

 

 

 

 

 

 

 

Basic

$

 

0.95

 

 

$

 

2.38

 

 

$

 

2.26

 

 

$

 

3.20

 

 

$

 

3.73

 

Diluted

 

0.87

 

 

 

1.71

 

 

 

1.75

 

 

 

2.59

 

 

 

2.83

 

 

 

 

 

 

 

 

 

 

 

Net income

$

 

19,351

 

 

$

 

38,110

 

 

$

 

35,719

 

 

$

 

55,070

 

 

$

 

62,448

 

Comprehensive income (loss) from unconsolidated investment and other

 

(825

)

 

 

(434

)

 

 

1,005

 

 

 

180

 

 

 

(1,559

)

Comprehensive income

$

 

18,526

 

 

$

 

37,676

 

 

$

 

36,724

 

 

$

 

55,250

 

 

$

 

60,889

 

Comprehensive income attributable to non-controlling interest

 

 

 

(869

)

 

 

 

 

 

 

(869

)

Comprehensive income attributable to NRP

$

18,526

 

 

$

 

36,807

 

 

$

 

36,724

 

 

$

 

55,250

 

 

$

 

60,020

 

Natural Resource Partners L.P.

Financial Tables

(Unaudited)

 

Consolidated Statements of Cash Flows

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

 

March 31,

 

June 30,

(In thousands)

 

2019

 

2018

 

2019

 

2019

 

2018

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

Net income

 

$

 

19,351

 

 

$

 

38,110

 

 

$

 

35,719

 

 

$

 

55,070

 

 

$

 

62,448

 

Adjustments to reconcile net income to net cash provided by operating activities of continuing operations:

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

 

3,970

 

 

 

5,376

 

 

 

4,392

 

 

 

8,362

 

 

 

10,476

 

Distributions from unconsolidated investment

 

 

9,310

 

 

 

12,250

 

 

 

9,800

 

 

 

19,110

 

 

 

22,403

 

Equity earnings from unconsolidated investment

 

 

(11,333

)

 

 

(16,529

)

 

 

(11,682

)

 

 

(23,015

)

 

 

(26,150

)

Gain on asset sales

 

 

(246

)

 

 

(168

)

 

 

(256

)

 

 

(502

)

 

 

(819

)

Loss on extinguishment of debt

 

 

29,282

 

 

 

 

 

 

 

29,282

 

 

 

(Income) loss from discontinued operations

 

 

(245

)

 

 

(2,981

)

 

 

46

 

 

 

(199

)

 

 

(1,033

)

Asset impairments

 

 

 

 

 

 

 

 

 

 

242

 

Unit-based compensation expense

 

 

475

 

 

 

303

 

 

 

901

 

 

 

1,376

 

 

 

990

 

Amortization of debt issuance costs and other

 

 

355

 

 

 

1,661

 

 

 

1,796

 

 

 

2,151

 

 

 

2,815

 

Change in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

 

8,511

 

 

 

2,984

 

 

 

(4,927

)

 

 

3,584

 

 

 

(7,043

)

Accounts payable

 

 

(561

)

 

 

(6

)

 

 

(616

)

 

 

(1,177

)

 

 

863

 

Accrued liabilities

 

 

642

 

 

 

1,755

 

 

 

(6,164

)

 

 

(5,522

)

 

 

(3,287

)

Accrued interest

 

 

2,889

 

 

 

8,902

 

 

 

(10,033

)

 

 

(7,144

)

 

 

(875

)

Deferred revenue

 

 

(7,218

)

 

 

3,645

 

 

 

4,534

 

 

 

(2,684

)

 

 

9,006

 

Other items, net

 

 

(1,823

)

 

 

(1,409

)

 

 

(678

)

 

 

(2,501

)

 

 

1,271

 

Net cash provided by operating activities of continuing operations

 

$

 

53,359

 

 

$

 

53,893

 

 

$

 

22,832

 

 

$

 

76,191

 

 

$

 

71,307

 

Net cash provided by operating activities of discontinued operations

 

 

234

 

 

 

451

 

 

 

121

 

 

 

355

 

 

 

2,836

 

Net cash provided by operating activities

 

$

 

53,593

 

 

$

 

54,344

 

 

$

 

22,953

 

 

$

 

76,546

 

 

$

 

74,143

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

Distributions from unconsolidated investment in excess of cumulative earnings

 

$

 

 

 

$

 

 

 

$

 

 

 

$

 

 

 

$

 

2,097

 

Proceeds from sale of assets

 

 

247

 

 

 

170

 

 

 

256

 

 

 

503

 

 

 

826

 

Return of long-term contract receivable

 

 

451

 

 

 

529

 

 

 

441

 

 

 

892

 

 

 

1,016

 

Net cash provided by investing activities of continuing operations

 

$

 

698

 

 

$

 

699

 

 

$

 

697

 

 

$

 

1,395

 

 

$

 

3,939

 

Net cash used in investing activities of discontinued operations

 

 

(44

)

 

 

(2,359

)

 

 

(390

)

 

 

(434

)

 

 

(5,772

)

Net cash provided by (used in) investing activities

 

$

 

654

 

 

$

 

(1,660

)

 

$

 

307

 

 

$

 

961

 

 

$

 

(1,833

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

Debt borrowings

 

 

300,000

 

 

 

 

 

 

 

300,000

 

 

 

35,000

 

Debt repayments

 

 

(348,002

)

 

 

(7,272

)

 

 

(86,468

)

 

 

(434,470

)

 

 

(48,072

)

Redemption of preferred units paid-in-kind

 

 

 

 

 

 

 

 

 

 

(8,844

)

Distributions to common unitholders and general partner

 

 

(16,265

)

 

 

(5,623

)

 

 

(5,625

)

 

 

(21,890

)

 

 

(11,240

)

Distributions to preferred unitholders

 

 

(7,500

)

 

 

(7,500

)

 

 

(7,500

)

 

 

(15,000

)

 

 

(15,265

)

Contributions from (to) discontinued operations

 

 

190

 

 

 

(3,658

)

 

 

(269

)

 

 

(79

)

 

 

(2,250

)

Debt issuance costs and other

 

 

(26,412

)

 

 

 

 

10

 

 

 

(26,402

)

 

 

(226

)

Net cash used in financing activities of continuing operations

 

$

 

(97,989

)

 

$

 

(24,053

)

 

$

 

(99,852

)

 

$

 

(197,841

)

 

$

 

(50,897

)

Net cash provided by (used in) financing activities of discontinued operations

 

 

(190

)

 

 

3,192

 

 

 

269

 

 

 

79

 

 

 

1,735

 

Net cash used in financing activities

 

$

 

(98,179

)

 

$

 

(20,861

)

 

$

 

(99,583

)

 

$

 

(197,762

)

 

$

 

(49,162

)

 

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash, cash equivalents and restricted cash

 

$

 

(43,932

)

 

$

 

31,823

 

 

$

 

(76,323

)

 

$

 

(120,255

)

 

$

 

23,148

 

 

 

 

 

 

 

 

 

 

 

 

Cash, cash equivalents and restricted cash of continuing operations at beginning of period

 

$

 

129,707

 

 

$

 

20,790

 

 

$

 

206,030

 

 

$

 

206,030

 

 

$

 

26,980

 

Cash and cash equivalents of discontinued operations at beginning of period

 

 

 

 

362

 

 

 

 

 

 

 

2,847

 

Cash, cash equivalents and restricted cash at beginning of period

 

$

 

129,707

 

 

$

 

21,152

 

 

$

 

206,030

 

 

$

 

206,030

 

 

$

 

29,827

 

 

 

 

 

 

 

 

 

 

 

 

Cash, cash equivalents and restricted cash at end of period

 

$

 

85,775

 

 

$

 

52,975

 

 

$

 

129,707

 

 

$

 

85,775

 

 

$

 

52,975

 

Less: cash and cash equivalents of discontinued operations at end of period

 

 

 

 

(1,646

)

 

 

 

 

 

 

(1,646

)

Cash, cash equivalents and restricted cash of continuing operations at end of period

 

$

 

85,775

 

 

$

 

51,329

 

 

$

 

129,707

 

 

$

 

85,775

 

 

$

 

51,329

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental cash flow information:

 

 

 

 

 

 

 

 

 

 

Cash paid during the period for interest of continuing operations

 

$

 

9,623

 

 

$

 

7,132

 

 

$

 

23,422

 

 

$

 

33,045

 

 

$

 

33,155

 

Natural Resource Partners L.P.

Financial Tables

(Unaudited)

 

Consolidated Balance Sheets

 

 

June 30,

December 31,

(In thousands, except unit data)

2019

2018

ASSETS

 

 

Current assets

 

 

Cash and cash equivalents

$

70,850

 

$

101,839

 

Restricted cash

 

14,925

 

 

104,191

 

Accounts receivable, net

 

28,553

 

 

32,058

 

Prepaid expenses and other

 

5,963

 

 

3,462

 

Current assets of discontinued operations

 

984

 

 

993

 

Total current assets

$

121,275

 

$

242,543

 

Land

 

24,008

 

 

24,008

 

Plant and equipment, net

 

825

 

 

984

 

Mineral rights, net

 

736,413

 

 

743,112

 

Intangible assets, net

 

41,008

 

 

42,513

 

Equity in unconsolidated investment

 

251,135

 

 

247,051

 

Long-term contracts receivable

 

37,973

 

 

38,945

 

Other assets

 

6,806

 

 

2,491

 

Total assets

$

1,219,443

 

$

1,341,647

 

LIABILITIES AND CAPITAL

 

 

Current liabilities

 

 

Accounts payable

$

1,211

 

$

2,414

 

Accrued liabilities

 

6,856

 

 

12,347

 

Accrued interest

 

7,201

 

 

14,345

 

Current portion of deferred revenue

 

6,579

 

 

3,509

 

Current portion of long-term debt, net

 

46,040

 

 

115,184

 

Current liabilities of discontinued operations

 

658

 

 

947

 

Total current liabilities

$

68,545

 

$

148,746

 

Deferred revenue

 

43,290

 

 

49,044

 

Long-term debt, net

 

498,029

 

 

557,574

 

Other non-current liabilities

 

4,731

 

 

1,150

 

Total liabilities

$

614,595

 

$

756,514

 

Commitments and contingencies

 

 

Class A Convertible Preferred Units (250,000 units issued and outstanding at $1,000 par value per unit; liquidation preference of $1,500 per unit)

$

164,587

 

$

164,587

 

Partners’ capital:

 

 

Common unitholders’ interest (12,261,199 and 12,249,469 units issued and outstanding at June 30, 2019 and December 31, 2018, respectively)

$

374,275

 

$

355,113

 

General partner’s interest

 

5,387

 

 

5,014

 

Warrant holders' interest

 

66,816

 

 

66,816

 

Accumulated other comprehensive loss

 

(3,282

)

 

(3,462

)

Total partners’ capital

 

443,196

 

 

423,481

 

Non-controlling interest

 

(2,935

)

 

(2,935

)

Total capital

 

440,261

 

 

420,546

 

Total liabilities and capital

$

1,219,443

 

$

1,341,647

 

Natural Resource Partners L.P.

Financial Tables

(Unaudited)

 

Consolidated Statements of Partners' Capital

 

 

Common Unitholders

 

General Partner

 

Warrant Holders

 

Accumulated
Other
Comprehensive Loss

 

Partners' Capital
Excluding

Non-Controlling Interest

 

Non-Controlling Interest

 

Total Capital

 

(In thousands)

Units

 

Amounts

 

Balance at December 31, 2018

12,249

 

 

$

 

355,113

 

 

$

 

5,014

 

 

$

 

66,816

 

 

$

 

(3,462

)

 

$

 

423,481

 

 

$

 

(2,935

)

 

$

 

420,546

 

Net income (1)

 

 

 

35,005

 

 

 

714

 

 

 

 

 

 

 

35,719

 

 

 

 

 

35,719

 

Distributions to common unitholders and general partner

 

 

 

(5,513

)

 

 

(112

)

 

 

 

 

 

 

(5,625

)

 

 

 

 

(5,625

)

Distributions to preferred unitholders

 

 

 

(7,350

)

 

 

(150

)

 

 

 

 

 

 

(7,500

)

 

 

 

 

(7,500

)

Issuance of unit-based awards

12

 

 

 

486

 

 

 

 

 

 

 

 

 

486

 

 

 

 

 

486

 

Unit-based awards amortization and vesting

 

 

 

399

 

 

 

 

 

 

 

 

 

399

 

 

 

 

 

399

 

Comprehensive income from unconsolidated investment and other

 

 

 

 

 

10

 

 

 

 

 

1,005

 

 

 

1,015

 

 

 

 

 

1,015

 

Balance at March 31, 2019

12,261

 

 

$

 

378,140

 

 

$

 

5,476

 

 

$

 

66,816

 

 

$

 

(2,457

)

 

$

 

447,975

 

 

$

 

(2,935

)

 

$

 

445,040

 

Net income (1)

 

 

 

18,964

 

 

 

387

 

 

 

 

 

 

 

19,351

 

 

 

 

 

19,351

 

Distributions to common unitholders and general partner

 

 

 

(15,939

)

 

 

(326

)

 

 

 

 

 

 

(16,265

)

 

 

 

 

(16,265

)

Distributions to preferred unitholders

 

 

 

(7,350

)

 

 

(150

)

 

 

 

 

 

 

(7,500

)

 

 

 

 

(7,500

)

Unit-based awards amortization and vesting

 

 

 

460

 

 

 

 

 

 

 

 

 

460

 

 

 

 

 

460

 

Comprehensive loss from unconsolidated investment and other

 

 

 

 

 

 

 

 

 

(825

)

 

 

(825

)

 

 

 

 

(825

)

Balance at June 30, 2019

12,261

 

 

$

 

374,275

 

 

$

 

5,387

 

 

$

 

66,816

 

 

$

 

(3,282

)

 

$

 

443,196

 

 

$

 

(2,935

)

 

$

 

440,261

 

________________

(1)

Net income includes $7.5 million attributable to preferred unitholders that accumulated during the period, of which $7.35 million is allocated to the common unitholders and $0.15 million is allocated to the general partner.

Natural Resource Partners L.P.

Financial Tables

(Unaudited)

 

Consolidated Statements of Partners' Capital

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Unitholders

 

General Partner

 

Warrant Holders

 

Accumulated
Other
Comprehensive
Loss

 

Partners' Capital Excluding Non- Controlling Interest

 

Non- Controlling Interest

 

Total Capital

 

(In thousands)

Units

 

Amounts

 

Balance at December 31, 2017

12,232

 

 

$

199,851

 

 

$

1,857

 

 

$

66,816

 

 

$

(3,313

)

 

$

265,211

 

 

$

(3,394

)

 

$

261,817

 

Cumulative effect of adoption of accounting standard

 

 

69,057

 

 

1,409

 

 

 

 

 

 

70,466

 

 

 

 

70,466

 

Net income (1)

 

 

23,851

 

 

487

 

 

 

 

 

 

24,338

 

 

 

 

24,338

 

Distributions to common unitholders and general partner

 

 

(5,505

)

 

(112

)

 

 

 

 

 

(5,617

)

 

 

 

(5,617

)

Distributions to preferred unitholders

 

 

(7,610

)

 

(155

)

 

 

 

 

 

(7,765

)

 

 

 

(7,765

)

Issuance of unit-based awards

14

 

 

410

 

 

 

 

 

 

 

 

410

 

 

 

 

410

 

Unit-based awards amortization and vesting

 

 

197

 

 

 

 

 

 

 

 

197

 

 

 

 

197

 

Comprehensive income (loss) from unconsolidated investment and other

 

 

 

 

8

 

 

 

 

(1,125

)

 

(1,117

)

 

 

 

(1,117

)

Balance at March 31, 2018

12,246

 

 

$

280,251

 

 

$

3,494

 

 

$

66,816

 

 

$

(4,438

)

 

$

346,123

 

 

$

(3,394

)

 

$

342,729

 

Net income (1)

 

 

36,496

 

 

745

 

 

 

 

 

 

37,241

 

 

869

 

 

38,110

 

Distributions to common unitholders and general partner

 

 

(5,510

)

 

(113

)

 

 

 

 

 

(5,623

)

 

 

 

(5,623

)

Distributions to preferred unitholders

 

 

(7,350

)

 

(150

)

 

 

 

 

 

(7,500

)

 

 

 

(7,500

)

Unit-based awards amortization and vesting

 

 

136

 

 

 

 

 

 

 

 

136

 

 

 

 

136

 

Comprehensive income (loss) from unconsolidated investment and other

 

 

50

 

 

1

 

 

 

 

(434

)

 

(383

)

 

(51

)

 

(434

)

Balance at June 30, 2018

12,246

 

 

$

304,073

 

 

$

3,977

 

 

$

66,816

 

 

$

(4,872

)

 

$

369,994

 

 

$

(2,576

)

 

$

367,418

 

________________

(1)

Net income includes $7.5 million attributable to preferred unitholders that accumulated during the period, of which $7.35 million is allocated to the common unitholders and $0.15 million is allocated to the general partner.

Natural Resource Partners L.P.

Financial Tables

(Unaudited)

 

The following tables present NRP's unaudited business results by segment for the three months ended June 30, 2019 and 2018 and March 31, 2019:

 

 

 

Operating Business Segments

 

 

 

 

 

 

Coal Royalty
and Other

 

 

 

Corporate and
Financing

 

 

(In thousands)

 

 

Soda Ash

 

 

Total

Three Months Ended June 30, 2019

 

 

 

 

 

 

 

 

Revenues

 

$

 

69,890

 

 

$

 

11,333

 

 

$

 

 

 

$

 

81,223

 

Gain on asset sales

 

 

246

 

 

 

 

 

 

 

246

 

Total revenues and other income

 

$

 

70,136

 

 

$

 

11,333

 

 

$

 

 

 

$

 

81,469

 

Asset impairments

 

$

 

 

 

$

 

 

 

$

 

 

 

$

 

 

Net income (loss) from continuing operations

 

$

 

53,707

 

 

$

 

11,333

 

 

$

 

(45,934

)

 

$

 

19,106

 

Adjusted EBITDA (1)

 

$

 

57,677

 

 

$

 

9,310

 

 

$

 

(4,196

)

 

$

 

62,791

 

Distributable cash flow (1) (2)

 

$

 

56,509

 

 

$

 

9,310

 

 

$

 

(11,762

)

 

$

 

54,013

 

Free cash flow (1)

 

$

 

56,262

 

 

$

 

9,310

 

 

$

 

(11,762

)

 

$

 

53,810

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2018

 

 

 

 

 

 

 

 

Revenues

 

$

 

52,922

 

 

$

 

16,529

 

 

$

 

 

 

$

 

69,451

 

Gain on asset sales, net

 

 

168

 

 

 

 

 

 

 

168

 

Total revenues and other income

 

$

 

53,090

 

 

$

 

16,529

 

 

$

 

 

 

$

 

69,619

 

Asset impairments

 

$

 

 

 

$

 

 

 

$

 

 

 

$

 

 

Net income (loss) from continuing operations

 

$

 

39,597

 

 

$

 

16,529

 

 

$

 

(20,997

)

 

$

 

35,129

 

Adjusted EBITDA (1)

 

$

 

44,104

 

 

$

 

12,250

 

 

$

 

(3,263

)

 

$

 

53,091

 

Distributable cash flow (1)

 

$

 

52,424

 

 

$

 

12,250

 

 

$

 

(10,082

)

 

$

 

54,592

 

Free cash flow (1)

 

$

 

52,254

 

 

$

 

12,250

 

 

$

 

(10,082

)

 

$

 

54,422

 

 

 

 

 

 

 

 

 

 

Three Months Ended March 31, 2019

 

 

 

 

 

 

 

 

Revenues

 

$

 

55,103

 

 

$

 

11,682

 

 

$

 

 

 

$

 

66,785

 

Gain on asset sales

 

 

256

 

 

 

 

 

 

 

256

 

Total revenues and other income

 

$

 

55,359

 

 

$

 

11,682

 

 

$

 

 

 

$

 

67,041

 

Asset impairments

 

$

 

 

 

$

 

 

 

$

 

 

 

$

 

 

Net income (loss) from continuing operations

 

$

 

42,607

 

 

$

 

11,682

 

 

$

 

(18,524

)

 

$

 

35,765

 

Adjusted EBITDA (1)

 

$

 

46,999

 

 

$

 

9,800

 

 

$

 

(4,350

)

 

$

 

52,449

 

Cash flow provided by (used in) continuing operations:

 

 

 

 

 

 

 

 

Operating activities

 

$

 

42,916

 

 

$

 

9,800

 

 

$

 

(29,884

)

 

$

 

22,832

 

Investing activities

 

$

 

697

 

 

$

 

 

 

$

 

 

 

$

 

697

 

Financing activities

 

$

 

 

 

$

 

 

 

$

 

(99,852

)

 

$

 

(99,852

)

Distributable cash flow (1) (2)

 

$

 

43,613

 

 

$

 

9,800

 

 

$

 

(29,884

)

 

$

 

23,139

 

Free cash flow (1)

 

$

 

43,357

 

 

$

 

9,800

 

 

$

 

(29,884

)

 

$

 

23,273

 

________________

(1)

See "Non-GAAP Financial Measures" and reconciliation tables at the end of this release.

(2)

Includes adjustments of net proceeds from the sale of the construction aggregates business which are classified as investing cash flow from discontinued operations.

Natural Resource Partners L.P.

Financial Tables

(Unaudited)

 

The following tables present NRP's unaudited business results by segment for the six months ended June 30, 2019 and 2018:

 

 

Operating Business Segments

 

 

 

 

 

 

Coal Royalty
and Other

 

 

 

Corporate and
Financing

 

 

(In thousands)

 

 

Soda Ash

 

 

Total

Six Months Ended June 30, 2019

 

 

 

 

 

 

 

 

Revenues

 

$

 

124,993

 

 

$

 

23,015

 

 

$

 

 

 

$

 

148,008

 

Gain on asset sales

 

 

502

 

 

 

 

 

 

 

502

 

Total revenues and other income

 

$

 

125,495

 

 

$

 

23,015

 

 

$

 

 

 

$

 

148,510

 

Asset impairments

 

$

 

 

 

$

 

 

 

$

 

 

 

$

 

 

Net income (loss) from continuing operations

 

$

 

96,314

 

 

$

 

23,015

 

 

$

 

(64,458

)

 

$

 

54,871

 

Adjusted EBITDA (1)

 

$

 

104,676

 

 

$

 

19,110

 

 

$

 

(8,546

)

 

$

 

115,240

 

Cash flow provided by (used in) continuing operations:

 

 

 

 

 

 

 

 

Operating activities

 

$

 

98,727

 

 

$

 

19,110

 

 

$

 

(41,646

)

 

$

 

76,191

 

Investing activities

 

$

 

1,395

 

 

$

 

 

 

$

 

 

 

$

 

1,395

 

Financing activities

 

$

 

 

 

$

 

 

 

$

 

(197,841

)

 

$

 

(197,841

)

Distributable cash flow (1) (2)

 

$

 

100,122

 

 

$

 

19,110

 

 

$

 

(41,646

)

 

$

 

77,152

 

Free cash flow (1)

 

$

 

99,619

 

 

$

 

19,110

 

 

$

 

(41,646

)

 

$

 

77,083

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2018

 

 

 

 

 

 

 

 

Revenues

 

$

 

102,779

 

 

$

 

26,150

 

 

$

 

 

 

$

 

128,929

 

Gain on asset sales

 

 

819

 

 

 

 

 

 

 

819

 

Total revenues and other income

 

$

 

103,598

 

 

$

 

26,150

 

 

$

 

 

 

$

 

129,748

 

Asset impairments

 

$

 

242

 

 

$

 

 

 

$

 

 

 

$

 

242

 

Net income (loss) from continuing operations

 

$

 

78,548

 

 

$

 

26,150

 

 

$

 

(43,283

)

 

$

 

61,415

 

Adjusted EBITDA (1)

 

$

 

88,397

 

 

$

 

24,500

 

 

$

 

(7,599

)

 

$

 

105,298

 

Cash flow provided by (used in) continuing operations:

 

 

 

 

 

 

 

 

Operating activities

 

$

 

90,518

 

 

$

 

22,403

 

 

$

 

(41,614

)

 

$

 

71,307

 

Investing activities

 

$

 

1,842

 

 

$

 

2,097

 

 

$

 

 

 

$

 

3,939

 

Financing activities

 

$

 

 

 

$

 

 

 

$

 

(50,897

)

 

$

 

(50,897

)

Distributable cash flow (1)

 

$

 

92,360

 

 

$

 

24,500

 

 

$

 

(41,614

)

 

$

 

75,246

 

Free cash flow (1)

 

$

 

91,534

 

 

$

 

24,500

 

 

$

 

(41,614

)

 

$

 

74,420

 

________________

(1)

See "Non-GAAP Financial Measures" and reconciliation tables at the end of this release.

(2)

Includes adjustments of net proceeds from the sale of the construction aggregates business which are classified as investing cash flow from discontinued operations.

Natural Resource Partners L.P.

Financial Tables

(Unaudited)

 

Operating Statistics - Coal Royalty and Other

 

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

 

March 31,

 

June 30,

(In thousands, except per ton data)

 

2019

 

2018

 

2019

 

2019

 

2018

Coal sales volumes (tons)

 

 

 

 

 

 

 

 

 

 

Appalachia

 

 

 

 

 

 

 

 

 

 

Northern (1)

 

 

1,625

 

 

 

916

 

 

 

859

 

 

 

2,484

 

 

 

1,141

 

Central

 

 

3,825

 

 

 

4,163

 

 

 

3,422

 

 

 

7,247

 

 

 

7,709

 

Southern

 

 

386

 

 

 

396

 

 

 

348

 

 

 

734

 

 

 

942

 

Total Appalachia

 

 

5,836

 

 

 

5,475

 

 

 

4,629

 

 

 

10,465

 

 

 

9,792

 

Illinois Basin

 

 

535

 

 

 

739

 

 

 

560

 

 

 

1,095

 

 

 

1,482

 

Northern Powder River Basin

 

 

591

 

 

 

808

 

 

 

856

 

 

 

1,447

 

 

 

2,041

 

Total coal sales volumes

 

 

6,962

 

 

 

7,022

 

 

 

6,045

 

 

 

13,007

 

 

 

13,315

 

Coal royalty revenue per ton

 

 

 

 

 

 

 

 

 

 

Appalachia

 

 

 

 

 

 

 

 

 

 

Northern (1)

 

$

 

0.86

 

 

$

 

3.52

 

 

$

 

4.71

 

 

$

 

2.19

 

 

$

 

3.76

 

Central

 

 

6.03

 

 

 

5.65

 

 

 

6.03

 

 

 

6.03

 

 

 

5.68

 

Southern

 

 

6.69

 

 

 

6.85

 

 

 

8.61

 

 

 

7.60

 

 

 

7.03

 

Illinois Basin

 

 

4.51

 

 

 

4.72

 

 

 

4.77

 

 

 

4.64

 

 

 

4.43

 

Northern Powder River Basin

 

 

2.75

 

 

 

2.25

 

 

 

2.61

 

 

 

2.66

 

 

 

2.24

 

Combined average coal royalty revenue per ton

 

 

4.46

 

 

 

4.95

 

 

 

5.39

 

 

 

4.89

 

 

 

4.94

 

Coal royalty revenues

 

 

 

 

 

 

 

 

 

 

Appalachia

 

 

 

 

 

 

 

 

 

 

Northern (1)

 

$

 

1,393

 

 

$

 

3,230

 

 

$

 

4,045

 

 

$

 

5,438

 

 

$

 

4,296

 

Central

 

 

23,055

 

 

 

23,520

 

 

 

20,644

 

 

 

43,699

 

 

 

43,752

 

Southern

 

 

2,581

 

 

 

2,712

 

 

 

2,997

 

 

 

5,578

 

 

 

6,626

 

Total Appalachia

 

 

27,029

 

 

 

29,462

 

 

 

27,686

 

 

 

54,715

 

 

 

54,674

 

Illinois Basin

 

 

2,411

 

 

 

3,485

 

 

 

2,670

 

 

 

5,081

 

 

 

6,560

 

Northern Powder River Basin

 

 

1,624

 

 

 

1,815

 

 

 

2,231

 

 

 

3,855

 

 

 

4,580

 

Unadjusted coal royalty revenues

 

 

31,064

 

 

 

34,762

 

 

 

32,587

 

 

$

 

63,651

 

 

$

 

65,814

 

Coal royalty adjustment for minimum leases

 

 

(361

)

 

 

 

 

(456

)

 

 

(817

)

 

 

(50

)

Total coal royalty revenues

 

$

 

30,703

 

 

$

 

34,762

 

 

$

 

32,131

 

 

$

 

62,834

 

 

$

 

65,764

 

Other revenues

 

 

 

 

 

 

 

 

 

 

Production lease minimum revenues

 

$

 

15,879

 

 

$

 

2,006

 

 

$

 

2,700

 

 

$

 

18,579

 

 

$

 

4,541

 

Minimum lease straight-line revenues

 

 

3,854

 

 

 

569

 

 

 

3,316

 

 

 

7,170

 

 

 

1,172

 

Property tax revenues

 

 

1,377

 

 

 

1,523

 

 

 

1,433

 

 

 

2,810

 

 

 

2,705

 

Wheelage revenues

 

 

1,945

 

 

 

1,609

 

 

 

1,415

 

 

 

3,360

 

 

 

3,583

 

Coal overriding royalty revenues

 

 

3,999

 

 

 

3,702

 

 

 

3,975

 

 

 

7,974

 

 

 

6,574

 

Lease amendment revenues

 

 

4,414

 

 

 

 

 

771

 

 

 

5,185

 

 

 

Aggregates royalty revenues

 

 

1,237

 

 

 

1,572

 

 

 

1,464

 

 

 

2,701

 

 

 

2,663

 

Oil and gas royalty revenues

 

 

482

 

 

 

1,354

 

 

 

1,719

 

 

 

2,201

 

 

 

4,252

 

Other

 

 

726

 

 

 

823

 

 

 

578

 

 

 

1,304

 

 

 

1,140

 

Total other revenues

 

$

 

33,913

 

 

$

 

13,158

 

 

$

 

17,371

 

 

$

 

51,284

 

 

$

 

26,630

 

Coal royalty and other

 

$

 

64,616

 

 

$

 

47,920

 

 

$

 

49,502

 

 

$

 

114,118

 

 

$

 

92,394

 

Transportation and processing services

 

 

5,274

 

 

 

5,002

 

 

 

5,601

 

 

 

10,875

 

 

 

10,385

 

Gain on asset sales

 

 

246

 

 

 

168

 

 

 

256

 

 

 

502

 

 

 

819

 

Total Coal Royalty and Other segment revenues and other income

 

$

 

70,136

 

 

$

 

53,090

 

 

$

 

55,359

 

 

$

 

125,495

 

 

$

 

103,598

 

________________
(1)

Northern Appalachia includes NRP's Hibbs Run property that has significant sales volumes, but a low fixed rate per ton.

Natural Resource Partners L.P.

Reconciliation of Non-GAAP Measures

(Unaudited)

Adjusted EBITDA

 

 

 

 

 

Coal Royalty
and Other

 

 

 

Corporate and
Financing

 

 

(In thousands)

 

 

Soda Ash

 

 

Total

Three Months Ended June 30, 2019

 

 

 

 

 

 

 

 

Net income (loss) from continuing operations

 

$

 

53,707

 

 

$

 

11,333

 

 

$

 

(45,934

)

 

$

 

19,106

 

Less: equity earnings from unconsolidated investment

 

 

 

 

(11,333

)

 

 

 

 

(11,333

)

Add: net loss attributable to non-controlling interest

 

 

 

 

 

 

 

 

Add: total distributions from unconsolidated investment

 

 

 

 

9,310

 

 

 

 

 

9,310

 

Add: interest expense, net

 

 

 

 

 

 

12,456

 

 

 

12,456

 

Add: loss on extinguishment of debt

 

 

 

 

 

 

29,282

 

 

 

29,282

 

Add: depreciation, depletion and amortization

 

 

3,970

 

 

 

 

 

 

 

3,970

 

Add: asset impairments

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

 

57,677

 

 

$

 

9,310

 

 

$

 

(4,196

)

 

$

 

62,791

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2018

 

 

 

 

 

 

 

 

Net income (loss) from continuing operations

 

$

 

39,597

 

 

$

 

16,529

 

 

$

 

(20,997

)

 

$

 

35,129

 

Less: equity earnings from unconsolidated investment

 

 

 

 

(16,529

)

 

 

 

 

(16,529

)

Less: net income attributable to non-controlling interest

 

 

(869

)

 

 

 

 

 

 

(869

)

Add: total distributions from unconsolidated investment

 

 

 

 

12,250

 

 

 

 

 

12,250

 

Add: interest expense, net

 

 

 

 

 

 

17,734

 

 

 

17,734

 

Add: loss on extinguishment of debt

 

 

 

 

 

 

 

 

Add: depreciation, depletion and amortization

 

 

5,376

 

 

 

 

 

 

 

5,376

 

Add: asset impairments

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

 

44,104

 

 

$

 

12,250

 

 

$

 

(3,263

)

 

$

 

53,091

 

 

 

 

 

 

 

 

 

 

Three Months Ended March 31, 2019

 

 

 

 

 

 

 

 

Net income (loss) from continuing operations

 

$

 

42,607

 

 

$

 

11,682

 

 

$

 

(18,524

)

 

$

 

35,765

 

Less: equity earnings from unconsolidated investment

 

 

 

 

(11,682

)

 

 

 

 

(11,682

)

Less: net income attributable to non-controlling interest

 

 

 

 

 

 

 

 

Add: total distributions from unconsolidated investment

 

 

 

 

9,800

 

 

 

 

 

9,800

 

Add: interest expense, net

 

 

 

 

 

 

14,174

 

 

 

14,174

 

Add: loss on extinguishment of debt

 

 

 

 

 

 

 

 

Add: depreciation, depletion and amortization

 

 

4,392

 

 

 

 

 

 

 

4,392

 

Add: asset impairments

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

 

46,999

 

 

$

 

9,800

 

 

$

 

(4,350

)

 

$

 

52,449

 

Natural Resource Partners L.P.

Reconciliation of Non-GAAP Measures

(Unaudited)

Adjusted EBITDA

 

 

 

Coal Royalty
and Other

 

 

 

Corporate and
Financing

 

 

(In thousands)

 

 

Soda Ash

 

 

Total

Six Months Ended June 30, 2019

 

 

 

 

 

 

 

 

Net income (loss) from continuing operations

 

$

 

96,314

 

 

$

 

23,015

 

 

$

 

(64,458

)

 

$

 

54,871

 

Less: equity earnings from unconsolidated investment

 

 

 

 

(23,015

)

 

 

 

 

(23,015

)

Less: net income attributable to non-controlling interest

 

 

 

 

 

 

 

 

Add: total distributions from unconsolidated investment

 

 

 

 

19,110

 

 

 

 

 

19,110

 

Add: interest expense, net

 

 

 

 

 

 

26,630

 

 

 

26,630

 

Add: loss on extinguishment of debt

 

 

 

 

 

 

29,282

 

 

 

29,282

 

Add: depreciation, depletion and amortization

 

 

8,362

 

 

 

 

 

 

 

8,362

 

Add: asset impairments

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

 

104,676

 

 

$

 

19,110

 

 

$

 

(8,546

)

 

$

 

115,240

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2018

 

 

 

 

 

 

 

 

Net income (loss) from continuing operations

 

$

 

78,548

 

 

$

 

26,150

 

 

$

 

(43,283

)

 

$

 

61,415

 

Less: equity earnings from unconsolidated investment

 

 

 

 

(26,150

)

 

 

 

 

(26,150

)

Less: net income attributable to non-controlling interest

 

 

(869

)

 

 

 

 

 

 

(869

)

Add: total distributions from unconsolidated investment

 

 

 

 

24,500

 

 

 

 

 

24,500

 

Add: interest expense, net

 

 

 

 

 

 

35,684

 

 

 

35,684

 

Add: loss on extinguishment of debt

 

 

 

 

 

 

 

 

Add: depreciation, depletion and amortization

 

 

10,476

 

 

 

 

 

 

 

10,476

 

Add: asset impairments

 

 

242

 

 

 

 

 

 

 

242

 

Adjusted EBITDA

 

$

 

88,397

 

 

$

 

24,500

 

 

$

 

(7,599

)

 

$

 

105,298

 

Natural Resource Partners L.P.

Reconciliation of Non-GAAP Measures

(Unaudited)

Distributable Cash Flow and Free Cash Flow

 

 

 

Coal Royalty
and Other

 

 

 

Corporate and
Financing

 

 

(In thousands)

 

 

Soda Ash

 

 

Total

Three Months Ended June 30, 2019

 

 

 

 

 

 

 

 

Net cash provided by (used in) operating activities of continuing operations

 

$

 

55,811

 

 

$

 

9,310

 

 

$

 

(11,762

)

 

 

53,359

 

Add: distributions from unconsolidated investment in excess of cumulative earnings

 

 

 

 

 

 

 

 

Add: proceeds from sale of assets

 

 

247

 

 

 

 

 

 

 

247

 

Add: proceeds from sale of discontinued operations

 

 

 

 

 

 

 

 

(44

)

Add: return of long-term contract receivables

 

 

451

 

 

 

 

 

 

 

451

 

Distributable cash flow

 

$

 

56,509

 

 

$

 

9,310

 

 

$

 

(11,762

)

 

$

 

54,013

 

Less: proceeds from sale of assets

 

 

(247

)

 

 

 

 

 

 

(247

)

Less: proceeds from sale of discontinued operations

 

 

 

 

 

 

 

 

44

 

Free cash flow

 

$

 

56,262

 

 

$

 

9,310

 

 

$

 

(11,762

)

 

$

 

53,810

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2018

 

 

 

 

 

 

 

 

Net cash provided by (used in) operating activities of continuing operations

 

$

 

51,725

 

 

$

 

12,250

 

 

$

 

(10,082

)

 

$

 

53,893

 

Add: distributions from unconsolidated investment in excess of cumulative earnings

 

 

 

 

 

 

 

 

Add: proceeds from sale of assets

 

 

170

 

 

 

 

 

 

 

170

 

Add: proceeds from sale of discontinued operations

 

 

 

 

 

 

 

 

Add: return of long-term contract receivables

 

 

529

 

 

 

 

 

 

 

529

 

Distributable cash flow

 

$

 

52,424

 

 

$

 

12,250

 

 

$

 

(10,082

)

 

$

 

54,592

 

Less: proceeds from sale of assets

 

 

(170

)

 

 

 

 

 

 

(170

)

Less: proceeds from sale of discontinued operations

 

 

 

 

 

 

 

 

Free cash flow

 

$

 

52,254

 

 

$

 

12,250

 

 

$

 

(10,082

)

 

$

 

54,422

 

 

 

 

 

 

 

 

 

 

Three Months Ended March 31, 2019

 

 

 

 

 

 

 

 

Net cash provided by (used in) operating activities of continuing operations

 

$

 

42,916

 

 

$

 

9,800

 

 

$

 

(29,884

)

 

$

 

22,832

 

Add: distributions from unconsolidated investment in excess of cumulative earnings

 

 

 

 

 

 

 

 

Add: proceeds from sale of assets

 

 

256

 

 

 

 

 

 

 

256

 

Add: proceeds from sale of discontinued operations

 

 

 

 

 

 

 

 

(390

)

Add: return of long-term contract receivables

 

 

441

 

 

 

 

 

 

 

441

 

Distributable cash flow

 

$

 

43,613

 

 

$

 

9,800

 

 

$

 

(29,884

)

 

$

 

23,139

 

Less: proceeds from sale of assets

 

 

(256

)

 

 

 

 

 

 

(256

)

Less: proceeds from sale of discontinued operations

 

 

 

 

 

 

 

 

390

 

Free cash flow

 

$

 

43,357

 

 

$

 

9,800

 

 

$

 

(29,884

)

 

$

 

23,273

 

Natural Resource Partners L.P.

Reconciliation of Non-GAAP Measures

(Unaudited)

Distributable Cash Flow and Free Cash Flow

 

 

 

 

 

Coal Royalty
and Other

 

 

 

Corporate and
Financing

 

 

(In thousands)

 

 

Soda Ash

 

 

Total

Six Months Ended June 30, 2019

 

 

 

 

 

 

 

 

Net cash provided by (used in) operating activities of continuing operations

 

$

 

98,727

 

 

$

 

19,110

 

 

$

 

(41,646

)

 

$

 

76,191

 

Add: distributions from unconsolidated investment in excess of cumulative earnings

 

 

 

 

 

 

 

 

Add: proceeds from sale of assets

 

 

503

 

 

 

 

 

 

 

503

 

Add: proceeds from sale of discontinued operations

 

 

 

 

 

 

 

 

(434

)

Add: return of long-term contract receivables

 

 

892

 

 

 

 

 

 

 

892

 

Distributable cash flow

 

$

 

100,122

 

 

$

 

19,110

 

 

$

 

(41,646

)

 

$

 

77,152

 

Less: proceeds from sale of assets

 

 

(503

)

 

 

 

 

 

 

(503

)

Less: proceeds from sale of discontinued operations

 

 

 

 

 

 

 

 

434

 

Free cash flow

 

$

 

99,619

 

 

$

 

19,110

 

 

$

 

(41,646

)

 

$

 

77,083

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2018

 

 

 

 

 

 

 

 

Net cash provided by (used in) operating activities of continuing operations

 

$

 

90,518

 

 

$

 

22,403

 

 

$

 

(41,614

)

 

$

 

71,307

 

Add: distributions from unconsolidated investment in excess of cumulative earnings

 

 

 

 

2,097

 

 

 

 

 

2,097

 

Add: proceeds from sale of assets

 

 

826

 

 

 

 

 

 

 

826

 

Add: proceeds from sale of discontinued operations

 

 

 

 

 

 

 

 

Add: return of long-term contract receivables

 

 

1,016

 

 

 

 

 

 

 

1,016

 

Distributable cash flow

 

$

 

92,360

 

 

$

 

24,500

 

 

$

 

(41,614

)

 

$

 

75,246

 

Less: proceeds from sale of assets

 

 

(826

)

 

 

 

 

 

 

(826

)

Less: proceeds from sale of discontinued operations

 

 

 

 

 

 

 

 

Free cash flow

 

$

 

91,534

 

 

$

 

24,500

 

 

$

 

(41,614

)

 

$

 

74,420

 

Natural Resource Partners L.P.

Reconciliation of Non-GAAP Measures

(Unaudited)

LTM Free Cash Flow and Cash Flow Cushion

 

 

 

 

 

 

 

Three Months Ended

 

 

(In thousands)

 

September 30,
2018

 

December 31,
2018

 

March 31,
2019

 

June 30,
2019

 

Last 12
Months

Net cash provided by (used in) operating activities of continuing operations

 

$

 

26,486

 

 

$

 

80,489

 

 

$

 

22,832

 

 

$

 

53,359

 

 

$

 

183,166

 

Add: proceeds from sale of assets

 

 

 

 

1,623

 

 

 

256

 

 

 

247

 

 

 

2,126

 

Add: proceeds from sale of discontinued operations

 

 

 

 

198,091

 

 

 

(390

)

 

 

(44

)

 

 

197,657

 

Add: return of long-term contract receivables

 

 

1,590

 

 

 

455

 

 

 

441

 

 

 

451

 

 

 

2,937

 

Distributable cash flow

 

$

 

28,076

 

 

$

 

280,658

 

 

$

 

23,139

 

 

$

 

54,013

 

 

$

 

385,886

 

Less: proceeds from sale of assets

 

 

 

 

(1,623

)

 

 

(256

)

 

 

(247

)

 

 

(2,126

)

Less: proceeds from sale of discontinued operations

 

 

 

 

(198,091

)

 

 

390

 

 

 

44

 

 

 

(197,657

)

Free cash flow

 

$

 

28,076

 

 

$

 

80,944

 

 

$

 

23,273

 

 

$

 

53,810

 

 

$

 

186,103

 

Add: free cash flow provided by discontinued operations

 

 

2,871

 

 

 

125

 

 

 

121

 

 

 

234

 

 

 

3,351

 

Free cash flow including discontinued operations

 

$

 

30,947

 

 

$

 

81,069

 

 

$

 

23,394

 

 

$

 

54,044

 

 

$

 

189,454

 

Less: free cash flow provided by discontinued operations

 

 

(2,871

)

 

 

(125

)

 

 

(121

)

 

 

(234

)

 

 

(3,351

)

Less: cash flow from one-time Hillsboro litigation settlement

 

 

 

 

(25,000

)

 

 

 

 

 

 

(25,000

)

Free cash flow excluding discontinued operations and one-time beneficial items

 

$

 

28,076

 

 

$

 

55,944

 

 

$

 

23,273

 

 

$

 

53,810

 

 

$

 

161,103

 

Less: mandatory Opco debt amortizations

 

 

(7,648

)

 

 

(24,665

)

 

 

(37,152

)

 

 

(2,365

)

 

 

(71,830

)

Less: preferred unit distributions

 

 

(7,500

)

 

 

(7,500

)

 

 

(7,500

)

 

 

(7,500

)

 

 

(30,000

)

Less: common unit distributions

 

 

(5,623

)

 

 

(5,623

)

 

 

(5,625

)

 

 

(16,265

)

 

 

(33,136

)

Cash flow cushion

 

$

 

7,305

 

 

$

 

18,156

 

 

$

 

(27,004

)

 

$

 

27,680

 

 

$

 

26,137

 

Natural Resource Partners L.P.

Reconciliation of Non-GAAP Measures

(Unaudited)

Leverage Ratio

 

 

 

Three Months Ended

 

 

(In thousands)

 

September 30,
2018

 

December 31,
2018

 

March 31,
2019

 

June 30,
2019

 

Last 12
Months

Net income from continuing operations

 

$

 

25,853

 

 

$

 

35,092

 

 

$

 

35,765

 

 

$

 

19,106

 

 

$

 

115,816

 

Less: equity earnings from unconsolidated investment

 

 

(8,836

)

 

 

(13,320

)

 

 

(11,682

)

 

 

(11,333

)

 

 

(45,171

)

Add: net loss attributable to non-controlling interest

 

 

359

 

 

 

 

 

 

 

 

 

359

 

Add: total distributions from unconsolidated investment

 

 

12,250

 

 

 

9,800

 

 

 

9,800

 

 

 

9,310

 

 

 

41,160

 

Add: interest expense, net

 

 

17,493

 

 

 

17,001

 

 

 

14,174

 

 

 

12,456

 

 

 

61,124

 

Add: loss on extinguishment of debt

 

 

 

 

 

 

 

 

29,282

 

 

 

29,282

 

Add: depreciation, depletion and amortization

 

 

4,888

 

 

 

6,325

 

 

 

4,392

 

 

 

3,970

 

 

 

19,575

 

Add: asset impairments

 

 

 

 

18,038

 

 

 

 

 

 

 

18,038

 

Adjusted EBITDA

 

$

 

52,007

 

 

$

 

72,936

 

 

$

 

52,449

 

 

$

 

62,791

 

 

$

 

240,183

 

Less: one-time Hillsboro litigation settlement

 

 

 

 

 

 

 

 

 

 

(25,000

)

Adjusted EBITDA less one-time Hillsboro litigation settlement

 

 

 

 

 

 

 

 

 

$

 

215,183

 

 

 

 

 

 

 

 

 

 

 

 

Debt—at June 30, 2019

 

 

 

 

 

 

 

 

 

$

 

552,667

 

 

 

 

 

 

 

 

 

 

 

 

Leverage Ratio (1)

 

 

 

 

 

 

 

 

 

 

2.3

x

 

 

 

 

 

 

 

 

 

 

 

Leverage Ratio less one-time Hillsboro litigation settlement (2)

 

 

 

 

 

 

 

 

 

 

2.6

x

________________

(1)

Leverage Ratio is calculated as the outstanding principal of NRP's debt as of June 30, 2019 divided by the last twelve months' Adjusted EBITDA.

(2)