NuStar Energy L.P. (NYSE:NS) Q3 2019 Earnings Conference Call - Final Transcript

Nov 05, 2019 • 11:00 am ET


NuStar Energy L.P. (NYSE:NS) Q3 2019 Earnings Conference Call - Final Transcript


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Ladies and gentlemen, thank you for standing by and welcome to the NuStar Energy L.P. Third Quarter 2019 Earnings Conference Call. [Operator Instructions]

I would now like to hand the conference over to your speaker today, Pam Schmidt, Vice President of Investor Relations. Thank you. Please go ahead, madam.

Pam Schmidt

Good morning and welcome to today's call. On the call today are Brad Barron, NuStar Energy L.P.'s President and CEO; and Tom Shoaf, Executive Vice President and CFO; along with other members of our management team.

Before we get started, we would like to remind you that during the course of this call, NuStar management will make statements about our current views concerning the future performance of NuStar that are forward-looking statements. These statements are subject to the various risks, uncertainties and assumptions described in our filings with the Securities and Exchange Commission. Actual results may differ materially from those described in the forward-looking statement.

During the course of this call, we will also refer to certain non-GAAP financial measures. These non-GAAP financial measures should not be considered as alternatives to GAAP measures. Reconciliations of certain of these non-GAAP financial measures to US GAAP may be found in our earnings press release with additional reconciliation located on the Financials page of the Investors section of our website at

With that, I will turn the call over to Brad.

Brad Barron

Good morning. Thank you all for joining us today. Before I turn it over to Tom for the details, I want to give you some highlights of NuStar's results and our expectations for 2019 and 2020.

NuStar produced strong results in the third quarter, once again demonstrating the strength of our assets and our business plan. On our last call, I told you that NuStar was and were up over second quarter 2018. I'm happy to report that's true again this quarter. NuStar is up over third quarter last year across the board. Our total pipeline and storage segment revenues are up 7%.

Our income from continuing operations is up 20%. Our EBITDA from continuing ops, up 10%. DCF available to common limited partners from continuing ops, up 14%. And our EPU from continuing operations is up 67%, adjusting for the EPU charge resulting from our simplification in 2018. Due in part to our sale of our St. Eustatius facility in July, our third quarter debt-to-EBITDA ratio was 3.96 times, which is significantly lower than Q3 2018's 4.52 times. This past quarter, we also continued executing on our 2019 capital program. We're now projecting 2019 total capital spending of between $485 million and $515 million, and we're already starting to see the benefits of that spending in our results.

This year, we'll focus our spending on three primary areas; deploying existing assets to supply refined products in Northern Mexico, expanding and connecting our Permian Crude System and completing the first phase of our Corpus Christi export project. We've made substantial progress on all of these fronts during the third quarter. We completed our