PBF Logistics (NYSE: PBFX) reported Q1 EPS of $0.54, $0.04 better than the analyst estimate of $0.50. Revenue for the quarter came in at $93 million versus the consensus estimate of $89.7 million.

"PBF Logistics operated well during the first quarter and our revenues were supported by our minimum volume commitments with PBF Energy. As we navigate the new market dynamics created by the COVID-19 pandemic, we expect our revenues to remain well-supported by our long-term contracts. However, we have seen a decline in our rack volumes as a result of demand destruction but this has been partially offset by increased revenue and opportunities in our storage segment," said PBF Logistics GP LLC Executive Vice President Matt Lucey. "Additionally, we announced a distribution of $0.30 per unit today and we believe this is prudent given the uncertain outlook. Our near-term strategy is to build coverage, de-lever the business and increase financial resources to pursue identified organic projects and future external growth opportunities that may arise out of the current market turmoil."

Business Developments

COVID-19

The recent outbreak of the coronavirus disease 2019 ("COVID-19") pandemic is negatively impacting worldwide economic and commercial activity and financial markets, as well as global demand for petroleum and petrochemical products. The COVID-19 pandemic and resulting governmental responses have also resulted in significant business and operational disruptions, including business closures, supply chain disruptions, travel restrictions, stay-at-home orders and limitations on the availability of workforces. While the COVID-19 pandemic is expected to adversely affect our business and operations, the full impact is unknown and rapidly evolving and the ultimate effect on our business is uncertain at this time. However, in light of the COVID-19 pandemic, we are taking necessary steps to mitigate potential adverse impacts on our business and operations as this pandemic continues, including reducing capital expenditures, decreasing operating expenses by reducing discretionary activities and third-party services and reducing our quarterly distribution. Due to the uncertainty of the full impact of the COVID-19 pandemic will have on our business, we have decided to reduce our quarterly distribution to our minimum quarterly distribution of $0.30 per unit, which represents a short term shift in our distribution strategy to build our cash flow coverage, de-lever our business and increase our financial resources as we continue to identify potential organic growth projects or strategic acquisitions. In addition, our parent sponsor and largest customer, PBF Energy, has taken similar steps to preserve liquidity and solidify its operations under the adverse market conditions caused by the COVID-19 pandemic.

The full extent to which the COVID-19 pandemic impacts our business and operations, or that of our parent sponsor, will depend on the severity, location and duration of the effects and spread of COVID-19, the actions undertaken by national, regional and local governments and health officials to contain the virus or treat its effects, related consumer responses and how quickly and to what extent economic conditions improve and normal business and operating conditions resume.

For earnings history and earnings-related data on PBF Logistics (PBFX) click here.