NuStar Energy L.P. (NS) Misses Q4 EPS by 4c, Revenues Beat

NuStar Energy L.P. (NYSE: NS) reported Q4 EPS of $0.13, $0.04 worse than the analyst estimate of $0.17. Revenue for the quarter came in at $386.64 million versus the consensus estimate of $350.87 million.

“As we came into 2020, we had just booked the best fourth quarter in company history and we were expecting a record year. However, by March 2020, the COVID-19 pandemic had devastated much of the global economy,” said NuStar President and CEO Brad Barron. "Faced with historically difficult conditions, our employees stepped up and through hard work and prudent planning, including right-sizing our capital program and significantly reducing our costs, we generated solid results."

Barron noted that 2020 was an unprecedented year filled with many unique pandemic-related obstacles to overcome, including a $225 million non-cash goodwill impairment charge in the first quarter of the year, which resulted from the steep drop in global crude and refined products demand; a $138 million non-operational charge related to NuStar’s repayment of a $500 million term loan in the third quarter, which was necessitated by the evaporation of the high-yield bond market in the early days of the pandemic; and a $35 million non-cash charge related to the sale of its Texas City terminals in the fourth quarter.

“Largely as a result of these items, NuStar reported net income of $16 million for the fourth quarter of 2020 and a net loss of $199 million for the year ended December 31, 2020. Despite these items we generated more than enough distributable cash flow to cover all our expenses for the year, including the $0.40 per unit quarterly distribution on our 109 million units outstanding, and still generate $19 million in excess distributable cash flow to help cover our capital investment program.

“I am also happy to say that despite a very difficult year for our economy, our industry and our company, our operations did not skip a beat in 2020 thanks to the dedication of our employees. We had no work-related COVID-19 transmissions and our safety and environmental record continued to be significantly better than our industry averages. And even though the pandemic depressed activity for much of the globe, we actually increased the number of barrels per day we handled, in both our pipeline and our storage segments, over 2019. In fact, in 2020 NuStar moved more than 817 million barrels of crude oil and refined products through our pipelines and terminals, 6 million more than in 2019.

"NuStar also reported full-year 2020 earnings before interest, taxes, depreciation and amortization (EBITDA) of $318 million. However, to provide an 'apples-to-apples' comparison with fourth quarter 2019 and full-year 2019 results, without the above-mentioned non-cash and non-operating charges, NuStar generated adjusted EBITDA of $723 million, which is more than 8 percent above our 2019 EBITDA from continuing operations of $668 million and at the high side of NuStar's previous guidance for the year," Barron noted.

“Our performance is a testament to our employees' perseverance, as well as to the remarkable resilience and quality of our assets and the markets we serve," Barron said.

For earnings history and earnings-related data on NuStar Energy L.P. (NS) click here.

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