Plains All American Pipeline, L.P. (PAA) announced fourth-quarter 2013 earnings of 74 cents per unit, beating the Zacks Consensus Estimate of 61 cents by 21.3% but lower than $1.01 reported in the year-ago quarter.
GAAP earnings per unit in the quarter were 58 cents versus 69 cents per unit in the fourth quarter of 2012.
The difference between GAAP and adjusted earnings during the reported quarter was due to the impact of a few one-time items. These include a 15 cent loss from derivative activities, equity-indexed compensation expense of 3 cents and a gain of 2 cents from tax effect.
Earnings for 2013 was $3.12 beating the Zacks Consensus Estimate of $2.83 by 10.2%.
Revenues
Total revenues at Plains All American Pipeline at the end of the fourth quarter were $10.6 billion versus $9.4 billion in the year-ago period, reflecting growth of 12.6%.
All the three segments performed fairly with the major upside coming from the 25.9% growth at the Facilities segment. Reported quarter revenues however fell short of the Zacks Consensus Estimate of $11.02 billion by 3.5%.
Revenues reported for full year 2013 were $42.2 billion, up 11.8% year over year. However, revenues missed the Zacks Consensus Estimate of $42.7 billion marginally by 0.95%.
Segment Details
Transportation: Segment revenue rose 3.8% in the fourth quarter from the year-ago comparable period and 5.8% in 2013 compared to 2012.
Facilities: Segment revenue surged 25.9% year over year in the reported quarter and 25.4% in 2013.
Supply & Logistics: Revenue from this segment jumped 11.9% year over year in the fourth quarter and 11.7% in 2013.
Operational Update
Total cost and expenses during the fourth quarter increased 13.3% over the year-earlier quarter and surged 11.4% in 2013.
Operating income fell nearly 2.0% in the fourth quarter from the year-ago period but rose 21.3% in 2013 as compared to last year.
Interest expenses of the partnership increased 6.8% to $79.0 million from $74.0 million in the fourth quarter 2012 and rose 52.1% to $303 million in 2013.
Financial Update
Cash provided by operating activities during the quarter was $360 million versus $361 million in the same period of 2012.
Long-term debt of the partnership as of Dec 31, 2013, was $6.7 billion versus $6.3 billion as of Dec 31, 2012. The long-term debt-to-capital ratio at the end of the quarter was 47%.
Guidance
The partnership expects total net income in the first quarter 2014 to range from $273 million to $335 million and earnings per unit in the vicinity of 44 cents to 60 cents.
Plains All American Pipeline expects net income in 2014 to range from $1.2 billion to $1.4 billion and earnings per unit in the range of $1.95 to $2.32.
Net revenue in the first quarter and full year 2014 is expected to range from $922 million to $957 million and $3.8 billion to $3.9 billion, respectively.
Plains All American Pipeline expects capital expenditures for expansion projects in 2014 to be approximately $1.7 billion and an additional $185 million to $205 million for maintenance of capital projects.
Upcoming Releases
Buckeye Partners, L.P. (BPL) is slated to release fourth-quarter 2013 earnings on Feb 7, 2014. The Zacks Consensus Estimate is at 85 cents.
Access Midstream Partners, L.P. (ACMP) is slated to release fourth-quarter 2013 earnings on Feb 18, 2014. The Zacks Consensus Estimate is 43 cents.
Crestwood Equity Partners LP (CEQP) is slated to release fourth-quarter 2013 earnings on Feb 26, 2014. The Zacks Consensus Estimate is 2 cents.
Zacks Rank
Plains All American Pipeline, L.P. currently holds a Zacks Rank #3 (Hold).
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