Green Plains Partners Reports First Quarter 2022 Financial Results

Rhea-AI Summary

Green Plains Partners LP (NASDAQ:GPP) reported a Q1 2022 net income of $10.4 million, or $0.44 per common unit, slightly down from $10.7 million in Q1 2021. Adjusted EBITDA decreased to $12.6 million from $13.8 million year-over-year. The partnership increased its cash distribution to $0.445 per unit for the third consecutive quarter, with a distribution coverage ratio of 1.06x. Total debt was reduced by $1.0 million, and leverage ratio stood at 1.15x.

Despite increased distribution, revenues declined, impacted by lower throughput and transportation services.

Positive

• Quarterly cash distribution increased to $0.445 per unit.
• Distribution coverage ratio of 1.06x indicates stable cash flow.
• Reduced term debt by $1.0 million enhances financial health.

Negative

• Net income decreased to $10.4 million from $10.7 million year-over-year.
• Adjusted EBITDA fell to $12.6 million from $13.8 million in Q1 2021.
• Consolidated revenues decreased by $1.3 million compared to Q1 2021.

Results for the First Quarter of 2022

• Net income of $10.4 million, or $0.44 per common unit
• Adjusted EBITDA of $12.6 million and distributable cash flow of $11.2 million
• Quarterly cash distribution increased to $0.445 per unit
• Distribution coverage ratio of 1.06x, LTM distribution coverage ratio of 1.32x
• Reduced term debt by $1.0 million
• Leverage ratio of 1.15x

OMAHA, Neb., May 02, 2022 (GLOBE NEWSWIRE) -- Green Plains Partners LP (NASDAQ:GPP) today announced financial and operating results for the first quarter of 2022. Net income attributable to the partnership was $10.4 million, or $0.44 per common unit, for the first quarter of 2022, compared with net income of $10.7 million, or $0.45 per common unit, for the same period in 2021.

The partnership also reported adjusted EBITDA of $12.6 million and distributable cash flow of $11.2 million for the first quarter of 2022, compared with adjusted EBITDA of $13.8 million and distributable cash flow of $11.7 million for the same period in 2021. Distribution coverage was 1.06x for the three months ended March 31, 2022.

“Green Plains Partners continues to deliver stable financial results,” said Todd Becker, President and Chief Executive Officer. “Our steady operating results and low leverage provide for consistent cash flow generation allowing the partnership to increase its quarterly distribution for the third consecutive quarter.”

First Quarter Highlights and Recent Developments

• On April 21, 2022, the board of directors of the partnership’s general partner increased the quarterly cash distribution to $0.445 per unit, or approximately $10.5 million, for the first quarter of 2022. The distribution is payable on May 13, 2022, to unitholders of record at the close of business on May 6, 2022.
  

Results of Operations
Consolidated revenues decreased $1.3 million for the three months ended March 31, 2022, compared with the same period for 2021. Storage and throughput services revenue decreased $0.7 million due to a reduction in the contracted minimum volume commitment as a result of the sale of our parent’s Ord ethanol plant in the first quarter of 2021. Railcar transportation services revenue decreased $0.4 million primarily due to a reduction in average volumetric capacity provided. Trucking and other revenue decreased $0.3 million primarily as a result of lower affiliate freight volume.

Operations and maintenance expenses decreased $0.2 million for the three months ended March 31, 2022, compared with the same period for 2021.

During the first quarter of 2022, Green Plains Inc.’s average production utilization rate was approximately 83.1% of capacity. Ethanol throughput was 197.2 million gallons, which was below the contracted minimum volume commitment. As a result, the partnership charged Green Plains Trade $1.1 million related to the minimum volume commitment deficiency for the quarter, resulting in a credit to be applied against potential excess volumes in future periods. The cumulative minimum volume deficiency credits available to Green Plains Trade as of March 31, 2022 totaled $5.2 million. If these credits are unused by Green Plains Trade, $1.4 million will expire on June 30, 2022, $1.9 million will expire on September 30, 2022, $0.8 million will expire on December 31, 2022 and $1.1 million will expire on March 31, 2023. These credits have been recognized in revenue by the partnership, and as such, future volumes throughput by Green Plains Trade in excess of the quarterly minimum volume commitment, up to the amount of these credits, will not be recognized in revenue in future periods prior to expiration.

GREEN PLAINS PARTNERS LP
SELECTED OPERATING DATA
(unaudited, in million gallons)
	Three Months Ended
	March 31,
	2022		2021		% Var.
Product volumes
Storage and throughput services	197.2		179.0		10.2		%
Terminal services:
Affiliate	27.3		18.4		48.4
Non-affiliate	21.5		24.4		(11.9	)
	48.8		42.8		14.0
Railcar capacity billed (daily average)	69.7		72.9		(4.4	)

Liquidity and Capital Resources
Total liquidity as of March 31, 2022 consisted of $15.0 million in cash and cash equivalents. Total debt outstanding was $58.4 million, net of debt issuance costs of $0.5 million.

Conference Call Information
On May 2, 2022, Green Plains Partners LP and Green Plains Inc. will host a joint conference call at 11 a.m. Eastern time (10 a.m. Central time) to discuss first quarter 2022 financial and operating results for each company. Domestic and international participants can access the conference call by dialing 877.711.2374 and 281.542.4862, respectively, and referencing conference ID 4449669. The company advises participants to call at least 10 minutes prior to the start time. Alternatively, the conference call, transcript and presentation will be accessible on Green Plains Partners’ website at http://ir.greenplainspartners.com.

Non-GAAP Financial Measures
Adjusted EBITDA and distributable cash flow are supplemental financial measures used to assess the partnership’s financial performance. Management believes adjusted EBITDA and distributable cash flow provide investors useful information in assessing the partnership’s financial condition and results of operations. Adjusted EBITDA is defined as earnings before interest expense, income tax expense, depreciation and amortization, plus adjustments for transaction costs related to acquisitions or financing transactions, unit-based compensation expense, net gains or losses on asset sales and the partnership’s proportional share of EBITDA adjustments of our equity method investee. Distributable cash flow is defined as adjusted EBITDA less interest paid or payable, income taxes paid or payable, maintenance capital expenditures and the partnership’s proportionate share of distributable cash flow adjustments of our equity method investee. References to LTM refer to results from the immediately preceding twelve-month period. Adjusted EBITDA and distributable cash flow are not presented in accordance with U.S. Generally Accepted Accounting Principles (GAAP) and therefore should not be considered in isolation or as alternatives to net income or any other measure of financial performance presented in accordance with GAAP to analyze the partnership’s results.

About Green Plains Partners LP
Green Plains Partners LP (NASDAQ:GPP) is a fee-based Delaware limited partnership formed by Green Plains Inc. to provide fuel storage and transportation services by owning, operating, developing and acquiring ethanol and fuel storage terminals, transportation assets and other related assets and businesses. For more information about Green Plains Partners, visit www.greenplainspartners.com.

About Green Plains Inc.
Green Plains Inc. (NASDAQ:GPRE) is a leading biorefining company focused on the development and utilization of fermentation, agricultural and biological technologies in the processing of annually renewable crops into sustainable value-added ingredients. This includes the production of cleaner low carbon biofuels, renewable feedstocks for advanced biofuels and high purity alcohols for use in cleaners and disinfectants. Green Plains is an innovative producer of ultra-high protein and novel ingredients for animal and aquaculture diets to help satisfy a growing global appetite for sustainable protein. The Company also owns a 48.9% limited partner interest and a 2.0% general partner interest in Green Plains Partners LP. For more information, visit www.gpreinc.com.

Forward-Looking Statements
This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements reflect management’s current views, which are subject to risks and uncertainties including, but not limited to, anticipated financial and operating results, plans and objectives that are not historical in nature. These statements may be identified by words such as “believe,” “expect,” “may,” “should,” “will” and similar expressions. Factors that could cause actual results to differ materially from those expressed or implied are discussed in Green Plains Partners’ reports filed with the Securities and Exchange Commission. Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. Green Plains Partners assumes no obligation to update any such forward-looking statements, except as required by law.

Consolidated Financial Results

GREEN PLAINS PARTNERS LP
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
	March 31,			December 31,
	2022			2021
ASSETS	(unaudited)
Current assets
Cash and cash equivalents	$	14,975		$	17,645
Accounts receivable, including from affiliates		17,040			14,555
Other current assets		535			845
Total current assets		32,550			33,045
Property and equipment, net		28,221			28,773
Operating lease right-of-use assets		40,429			38,863
Other assets		13,966			13,791
Total assets	$	115,166		$	114,472
LIABILITIES AND PARTNERS' EQUITY
Current liabilities
Accounts payable, including to affiliates	$	5,335		$	4,954
Operating lease current liabilities		12,057			12,108
Other current liabilities		5,648			5,420
Total current liabilities		23,040			22,482
Long-term debt		58,441			59,467
Asset retirement obligations		2,081			2,658
Operating lease long-term liabilities		29,321			27,562
Total liabilities		112,883			112,169
Partners' equity		2,283			2,303
Total liabilities and partners' equity	$	115,166		$	114,472

GREEN PLAINS PARTNERS LP
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands except per unit amounts)
	Three Months Ended
	March 31,
	2022				2021				% Var.
Revenues
Affiliate	$	18,095			$	19,309			(6.3	)	%
Non-affiliate		1,005				1,097			(8.4	)
Total revenues		19,100				20,406			(6.4	)
Operating expenses
Operations and maintenance (excluding depreciation and amortization reflected below)		5,565				5,754			(3.3	)
General and administrative		1,185				1,201			(1.3	)
Depreciation and amortization		898				887			1.2
Total operating expenses		7,648				7,842			(2.5	)
Operating income		11,452				12,564			(8.9	)
Interest expense		(1,239	)			(1,928	)		(35.7	)
Income before income taxes and income from equity method investee		10,213				10,636			(4.0	)
Income tax expense		(38	)			(84	)		(54.8	)
Income from equity method investee		175				175			-
Net income	$	10,350			$	10,727			(3.5	)	%
Net income attributable to partners' ownership interests:
General partner	$	207			$	215			(3.7	)	%
Limited partners - common unitholders		10,143				10,512			(3.5	)
Earnings per limited partner unit (basic and diluted):
Common units	$	0.44			$	0.45			(2.2	)	%
Weighted average limited partner units outstanding (basic and diluted):
Common units		23,208				23,161
Supplemental Revenues Data:
Storage and throughput services	$	11,558			$	12,261			(5.7	)	%
Railcar transportation services		4,652				5,042			(7.7	)
Terminal services		2,084				2,042			2.1
Trucking and other		806				1,061			(24.0	)
Total revenues	$	19,100			$	20,406			(6.4	)	%

GREEN PLAINS PARTNERS LP
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited, in thousands)
	Three Months Ended
	March 31,
	2022				2021
Cash flows from operating activities:
Net income	$	10,350			$	10,727
Noncash operating adjustments:
Depreciation and amortization		898				887
Other		(47	)			542
Net change in working capital		(2,277	)			(1,368	)
Net cash provided by operating activities		8,924				10,788
Cash flows from investing activities:
Purchases of property and equipment		(134	)			(153	)
Disposition of assets		-				27,000
Net cash provided by (used in) investing activities		(134	)			26,847
Cash flows from financing activities:
Payments of distributions		(10,429	)			(2,842	)
Net payments on revolving credit facility		-				300
Net payments on long-term debt		(1,031	)			(37,500	)
Net cash used in financing activities		(11,460	)			(40,042	)
Net change in cash and cash equivalents		(2,670	)			(2,407	)
Cash and cash equivalents, beginning of period		17,645				2,478
Cash and cash equivalents, end of period	$	14,975			$	71

GREEN PLAINS PARTNERS LP
RECONCILIATIONS TO NON-GAAP FINANCIAL MEASURES
(unaudited, in thousands except ratios)
	Three Months Ended								LTM Ended
	March 31,								March 31,
	2022				2021				2022
Net income	$	10,350			$	10,727			$	39,985
Interest expense (1)		1,239				1,928				6,703
Income tax expense		38				84				142
Depreciation and amortization		898				887				3,748
Transaction costs		-				5				-
Unit-based compensation expense		59				79				259
Proportional share of EBITDA adjustments of equity method investee (2)		45				44				185
Adjusted EBITDA		12,629				13,754				51,022
Interest paid or payable		(1,239	)			(1,928	)			(5,703	)
Income taxes paid or payable		(38	)			(84	)			(142	)
Maintenance capital expenditures		(132	)			(2	)			(269	)
Distributable cash flow (3)	$	11,220			$	11,740			$	44,908
Distributions declared (4)	$	10,547			$	2,842			$	34,130
Coverage ratio		1.06x				4.13x				1.32x
Long-term debt									$	58,441
Adjusted EBITDA									$	51,022
Leverage ratio										1.15x
(1) Interest expense for the twelve months ended March 31, 2022 includes $1.0 million in unamortized debt issuance costs written off upon extinguishment of debt.
(2) Represents the partnership's proportional share of depreciation and amortization of its equity method investee.
(3) Distributable cash flow does not include adjustments for the principal payments on the term loan of $1.0 million for the three months ended March 31, 2022 and $13.5 million for the twelve months ended March 31, 2022.
(4) Represents distributions declared for the applicable period and paid in the subsequent quarter.

Green Plains Contacts
Investors: Phil Boggs | Executive Vice President, Investor Relations | 402.884.8700 | phil.boggs@gpreinc.com
Media: Lisa Gibson | Communications Manager | 402.952.4971 | lisa.gibson@gpreinc.com

FAQ

What were Green Plains Partners LP's earnings for Q1 2022?

Green Plains Partners LP reported a net income of $10.4 million, or $0.44 per common unit, for Q1 2022.

How much did Green Plains Partners LP increase its cash distribution in Q1 2022?

The quarterly cash distribution was increased to $0.445 per unit.

What was the adjusted EBITDA for Green Plains Partners LP in Q1 2022?

The adjusted EBITDA for Q1 2022 was $12.6 million.

How did Green Plains Partners LP's revenue change in Q1 2022 compared to Q1 2021?

Consolidated revenues decreased by $1.3 million in Q1 2022 compared to the same period in 2021.

What is the distribution coverage ratio for Green Plains Partners LP for Q1 2022?

The distribution coverage ratio for Q1 2022 is 1.06x.