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Name | Symbol | Market | Type |
---|---|---|---|
Holly Energy Partners LP | NYSE:HEP | NYSE | Trust |
Price Change | % Change | Price | High Price | Low Price | Open Price | Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 20.45 | 0 | 01:00:00 |
☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 20-0833098 | |||||||
(State or other jurisdiction of
incorporation or organization) |
(I.R.S. Employer
Identification No.) |
|||||||
2828 N. Harwood, Suite 1300
|
||||||||
Dallas
|
||||||||
Texas
|
75201 | |||||||
(Address of principal executive offices) | (Zip code) |
Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934: | ||||||||||||||
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Common Limited Partner Units | HEP | New York Stock Exchange |
Large accelerated filer | ☒ | Accelerated filer |
☐
|
Non-accelerated filer |
☐
|
Smaller reporting company |
☐
|
||||||||||||||||
Emerging growth company |
☐
|
Item 1. | |||||||||||
Item 2. | |||||||||||
Item 3. | |||||||||||
Item 4. | |||||||||||
Item 1. | |||||||||||
Item 1A. | |||||||||||
Item 6. | |||||||||||
September 30,
2021 |
December 31, 2020 | |||||||||||||
(Unaudited) | ||||||||||||||
ASSETS | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents (Cushing Connect VIEs: $7,472 and $18,259, respectively)
|
$ | 12,816 | $ | 21,990 | ||||||||||
Accounts receivable: | ||||||||||||||
Trade | 12,121 | 14,543 | ||||||||||||
Affiliates | 41,507 | 47,972 | ||||||||||||
53,628 | 62,515 | |||||||||||||
Prepaid and other current assets | 8,174 | 9,487 | ||||||||||||
Total current assets | 74,618 | 93,992 | ||||||||||||
Properties and equipment, net (Cushing Connect VIEs: $0 and $47,801, respectively)
|
1,335,042 | 1,450,685 | ||||||||||||
Operating lease right-of-use assets, net | 2,501 | 2,979 | ||||||||||||
Net investment in leases (Cushing Connect VIEs: $95,598 and $0, respectively)
|
306,071 | 166,316 | ||||||||||||
Intangible assets, net | 76,809 | 87,315 | ||||||||||||
Goodwill | 223,650 | 234,684 | ||||||||||||
Equity method investments (Cushing Connect VIEs: $37,691 and $39,456, respectively)
|
117,027 | 120,544 | ||||||||||||
Other assets | 16,858 | 11,050 | ||||||||||||
Total assets | $ | 2,152,576 | $ | 2,167,565 | ||||||||||
LIABILITIES AND EQUITY | ||||||||||||||
Current liabilities: | ||||||||||||||
Accounts payable: | ||||||||||||||
Trade (Cushing Connect VIEs: $10,083 and $14,076, respectively)
|
$ | 25,472 | $ | 28,280 | ||||||||||
Affiliates | 14,605 | 18,120 | ||||||||||||
40,077 | 46,400 | |||||||||||||
Accrued interest | 4,604 | 10,892 | ||||||||||||
Deferred revenue | 10,768 | 11,368 | ||||||||||||
Accrued property taxes | 8,877 | 3,992 | ||||||||||||
Current operating lease liabilities | 706 | 875 | ||||||||||||
Current finance lease liabilities | 3,753 | 3,713 | ||||||||||||
Other current liabilities | 2,687 | 2,505 | ||||||||||||
Total current liabilities | 71,472 | 79,745 | ||||||||||||
Long-term debt | 1,333,309 | 1,405,603 | ||||||||||||
Noncurrent operating lease liabilities | 2,169 | 2,476 | ||||||||||||
Noncurrent finance lease liabilities | 65,565 | 68,047 | ||||||||||||
Other long-term liabilities | 12,317 | 12,905 | ||||||||||||
Deferred revenue | 30,920 | 40,581 | ||||||||||||
Class B unit | 55,593 | 52,850 | ||||||||||||
Equity: | ||||||||||||||
Partners’ equity: | ||||||||||||||
Common unitholders (105,440 units issued and outstanding
at September 30, 2021 and December 31, 2020)
|
437,998 | 379,292 | ||||||||||||
Noncontrolling interests | 143,233 | 126,066 | ||||||||||||
Total equity | 581,231 | 505,358 | ||||||||||||
Total liabilities and equity | $ | 2,152,576 | $ | 2,167,565 |
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||
Affiliates | $ | 97,124 | $ | 100,992 | $ | 298,192 | $ | 297,983 | ||||||||||||||||||
Third parties | 25,460 | 26,739 | 77,810 | 72,409 | ||||||||||||||||||||||
122,584 | 127,731 | 376,002 | 370,392 | |||||||||||||||||||||||
Operating costs and expenses: | ||||||||||||||||||||||||||
Operations (exclusive of depreciation and amortization) | 42,793 | 40,003 | 126,226 | 109,721 | ||||||||||||||||||||||
Depreciation and amortization | 21,826 | 26,190 | 71,894 | 75,202 | ||||||||||||||||||||||
General and administrative | 3,849 | 2,332 | 9,664 | 7,569 | ||||||||||||||||||||||
Goodwill impairment | — | 35,653 | 11,034 | 35,653 | ||||||||||||||||||||||
68,468 | 104,178 | 218,818 | 228,145 | |||||||||||||||||||||||
Operating income | 54,116 | 23,553 | 157,184 | 142,247 | ||||||||||||||||||||||
Other income (expense): | ||||||||||||||||||||||||||
Equity in earnings of equity method investments | 3,689 | 1,316 | 8,875 | 5,186 | ||||||||||||||||||||||
Interest expense
|
(13,417) | (14,104) | (40,595) | (45,650) | ||||||||||||||||||||||
Interest income | 6,835 | 2,803 | 19,997 | 7,834 | ||||||||||||||||||||||
Gain on sales-type leases | — | — | 24,677 | 33,834 | ||||||||||||||||||||||
Loss on early extinguishment of debt | — | — | — | (25,915) | ||||||||||||||||||||||
Gain on sale of assets and other | 77 | 7,465 | 5,994 | 8,439 | ||||||||||||||||||||||
(2,816) | (2,520) | 18,948 | (16,272) | |||||||||||||||||||||||
Income before income taxes | 51,300 | 21,033 | 176,132 | 125,975 | ||||||||||||||||||||||
State income tax benefit (expense) | 4 | (34) | (60) | (110) | ||||||||||||||||||||||
Net income | 51,304 | 20,999 | 176,072 | 125,865 | ||||||||||||||||||||||
Allocation of net income attributable to noncontrolling interests
|
(2,144) | (3,186) | (6,770) | (6,721) | ||||||||||||||||||||||
Net income attributable to the partners
|
49,160 | 17,813 | 169,302 | 119,144 | ||||||||||||||||||||||
Limited partners’ per unit interest in earnings—basic and diluted
|
$ | 0.46 | $ | 0.17 | $ | 1.60 | $ | 1.13 | ||||||||||||||||||
Weighted average limited partners’ units outstanding | 105,440 | 105,440 | 105,440 | 105,440 |
Nine Months Ended
September 30, |
||||||||||||||
2021 | 2020 | |||||||||||||
Cash flows from operating activities | ||||||||||||||
Net income | $ | 176,072 | $ | 125,865 | ||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||
Depreciation and amortization | 71,894 | 75,202 | ||||||||||||
Gain on sale of assets | (5,567) | (887) | ||||||||||||
Loss on early extinguishment of debt | — | 25,915 | ||||||||||||
Gain on sales-type leases | (24,677) | (33,834) | ||||||||||||
Goodwill impairment | 11,034 | 35,653 | ||||||||||||
Amortization of deferred charges | 2,992 | 2,479 | ||||||||||||
Equity-based compensation expense | 1,856 | 1,547 | ||||||||||||
Equity in earnings of equity method investments, net of distributions | — | (238) | ||||||||||||
(Increase) decrease in operating assets: | ||||||||||||||
Accounts receivable—trade | 3,020 | 4,874 | ||||||||||||
Accounts receivable—affiliates | 6,465 | 3,212 | ||||||||||||
Prepaid and other current assets | 2,452 | 1,885 | ||||||||||||
Increase (decrease) in operating liabilities: | ||||||||||||||
Accounts payable—trade | 3,202 | (2,258) | ||||||||||||
Accounts payable—affiliates | (3,515) | (9,815) | ||||||||||||
Accrued interest | (6,288) | (8,515) | ||||||||||||
Deferred revenue | (3,702) | (3,675) | ||||||||||||
Accrued property taxes | 4,885 | 5,173 | ||||||||||||
Other current liabilities | 183 | 544 | ||||||||||||
Other, net | 468 | 1,913 | ||||||||||||
Net cash provided by operating activities | 240,774 | 225,040 | ||||||||||||
Cash flows from investing activities | ||||||||||||||
Additions to properties and equipment | (78,592) | (38,642) | ||||||||||||
Investment in Cushing Connect JV Terminal | — | (2,438) | ||||||||||||
Proceeds from sale of assets | 7,365 | 961 | ||||||||||||
Distributions in excess of equity in earnings of equity investments | 3,517 | 701 | ||||||||||||
Net cash used for investing activities | (67,710) | (39,418) | ||||||||||||
Cash flows from financing activities | ||||||||||||||
Borrowings under credit agreement | 210,500 | 219,500 | ||||||||||||
Repayments of credit agreement borrowings | (283,500) | (237,000) | ||||||||||||
Redemption of senior notes | — | (522,500) | ||||||||||||
Proceeds from issuance of debt | — | 500,000 | ||||||||||||
Contributions from general partner | — | 611 | ||||||||||||
Contributions from noncontrolling interests | 21,285 | 15,382 | ||||||||||||
Distributions to HEP unitholders | (112,384) | (137,437) | ||||||||||||
Distributions to noncontrolling interests | (8,743) | (7,845) | ||||||||||||
Payments on finance leases | (2,666) | (2,666) | ||||||||||||
Deferred financing costs | (6,661) | (8,714) | ||||||||||||
Units withheld for tax withholding obligations | (69) | (149) | ||||||||||||
Net cash used by financing activities
|
(182,238) | (180,818) | ||||||||||||
Cash and cash equivalents | ||||||||||||||
Increase (decrease) for the period | (9,174) | 4,804 | ||||||||||||
Beginning of period | 21,990 | 13,287 | ||||||||||||
End of period | $ | 12,816 | $ | 18,091 | ||||||||||
Supplemental disclosure of cash flow information | ||||||||||||||
Cash paid during the period for interest | $44,147 | $51,375 |
Common
Units |
Noncontrolling Interests | Total Equity | ||||||||||||||||||
Balance December 31, 2020 | $ | 379,292 | $ | 126,066 | $ | 505,358 | ||||||||||||||
Contributions from noncontrolling interest | — | 9,746 | 9,746 | |||||||||||||||||
Distributions to HEP unitholders | (38,328) | — | (38,328) | |||||||||||||||||
Distributions to noncontrolling interests | — | (3,819) | (3,819) | |||||||||||||||||
Equity-based compensation | 683 | — | 683 | |||||||||||||||||
Class B unit accretion | (893) | — | (893) | |||||||||||||||||
Other | (68) | — | (68) | |||||||||||||||||
Net income | 65,290 | 1,647 | 66,937 | |||||||||||||||||
Balance March 31, 2021 | $ | 405,976 | $ | 133,640 | $ | 539,616 | ||||||||||||||
Contributions from noncontrolling interest | — | 9,780 | 9,780 | |||||||||||||||||
Distributions to HEP unitholders | (37,028) | — | (37,028) | |||||||||||||||||
Distributions to noncontrolling interest | — | (2,053) | (2,053) | |||||||||||||||||
Equity-based compensation | 527 | — | 527 | |||||||||||||||||
Class B unit accretion | (894) | — | (894) | |||||||||||||||||
Other | (2) | — | (2) | |||||||||||||||||
Net income | 56,639 | 1,192 | 57,831 | |||||||||||||||||
Balance June 30, 2021 | $ | 425,218 | $ | 142,559 | $ | 567,777 | ||||||||||||||
Contributions from noncontrolling interest | — | 2,358 | 2,358 | |||||||||||||||||
Distributions to HEP unitholders | (37,028) | — | (37,028) | |||||||||||||||||
Distributions to noncontrolling interest | — | (2,871) | (2,871) | |||||||||||||||||
Equity-based compensation | 646 | — | 646 | |||||||||||||||||
Class B unit accretion | (956) | — | (956) | |||||||||||||||||
Other | 1 | — | 1 | |||||||||||||||||
Net income | 50,117 | 1,187 | 51,304 | |||||||||||||||||
Balance September 30, 2021 | $ | 437,998 | $ | 143,233 | $ | 581,231 | ||||||||||||||
Common
Units |
Noncontrolling Interests | Total Equity | ||||||||||||||||||
Balance December 31, 2019 | $ | 381,103 | $ | 106,655 | $ | 487,758 | ||||||||||||||
Contributions from noncontrolling interest | — | 7,304 | 7,304 | |||||||||||||||||
Distributions to HEP unitholders | (68,519) | — | (68,519) | |||||||||||||||||
Distributions to noncontrolling interests | — | (3,000) | (3,000) | |||||||||||||||||
Equity-based compensation | 506 | — | 506 | |||||||||||||||||
Class B unit accretion | (835) | — | (835) | |||||||||||||||||
Other | 208 | — | 208 | |||||||||||||||||
Net income | 25,696 | 1,216 | 26,912 | |||||||||||||||||
Balance March 31, 2020 | $ | 338,159 | $ | 112,175 | $ | 450,334 | ||||||||||||||
Contributions from noncontrolling interest | — | 5,959 | 5,959 | |||||||||||||||||
Distributions to HEP unitholders | (34,460) | — | (34,460) | |||||||||||||||||
Distributions to noncontrolling interest | — | (1,000) | (1,000) | |||||||||||||||||
Equity-based compensation | 474 | — | 474 | |||||||||||||||||
Class B unit accretion | (835) | — | (835) | |||||||||||||||||
Other | 80 | — | 80 | |||||||||||||||||
Net income | 77,305 | 649 | 77,954 | |||||||||||||||||
Balance June 30, 2020 | $ | 380,723 | $ | 117,783 | $ | 498,506 | ||||||||||||||
Contributions from noncontrolling interest | — | 2,119 | 2,119 | |||||||||||||||||
Distributions to HEP unitholders | (34,458) | — | (34,458) | |||||||||||||||||
Distributions to noncontrolling interest | — | (3,845) | (3,845) | |||||||||||||||||
Equity-based compensation | 567 | — | 567 | |||||||||||||||||
Class B unit accretion | (894) | — | (894) | |||||||||||||||||
Other | 177 | — | 177 | |||||||||||||||||
Net income | 18,706 | 2,293 | 20,999 | |||||||||||||||||
Balance September 30, 2020 | $ | 364,821 | $ | 118,350 | $ | 483,171 | ||||||||||||||
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||||
Pipelines | $ | 67,354 | $ | 68,292 | $ | 202,180 | $ | 197,718 | ||||||||||||||||||
Terminals, tanks and loading racks | 33,317 | 39,036 | 108,386 | 112,814 | ||||||||||||||||||||||
Refinery processing units | 21,913 | 20,403 | 65,436 | 59,860 | ||||||||||||||||||||||
$ | 122,584 | $ | 127,731 | $ | 376,002 | $ | 370,392 |
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||||
Lease revenues | $ | 84,074 | $ | 90,077 | $ | 258,877 | $ | 269,931 | ||||||||||||||||||
Service revenues | 38,510 | 37,654 | 117,125 | 100,461 | ||||||||||||||||||||||
$ | 122,584 | $ | 127,731 | $ | 376,002 | $ | 370,392 |
September 30,
2021 |
December 31,
2020 |
|||||||||||||
(In thousands) | ||||||||||||||
Contract assets | $ | 6,593 | $ | 6,306 | ||||||||||
Contract liabilities | $ | (482) | $ | (500) |
Years Ending December 31, | (In millions) | |||||||
Remainder of 2021 | $ | 84 | ||||||
2022 | 312 | |||||||
2023 | 276 | |||||||
2024 | 238 | |||||||
2025 | 172 | |||||||
2026 | 157 | |||||||
Thereafter | 483 | |||||||
Total | $ | 1,722 |
September 30,
2021 |
December 31, 2020 | |||||||||||||
Operating leases: | ||||||||||||||
Operating lease right-of-use assets, net | $ | 2,501 | $ | 2,979 | ||||||||||
Current operating lease liabilities | 706 | 875 | ||||||||||||
Noncurrent operating lease liabilities | 2,169 | 2,476 | ||||||||||||
Total operating lease liabilities | $ | 2,875 | $ | 3,351 | ||||||||||
Finance leases: | ||||||||||||||
Properties and equipment | $ | 6,031 | $ | 6,410 | ||||||||||
Accumulated amortization | (3,437) | (3,390) | ||||||||||||
Properties and equipment, net | $ | 2,594 | $ | 3,020 | ||||||||||
Current finance lease liabilities | $ | 3,753 | $ | 3,713 | ||||||||||
Noncurrent finance lease liabilities | 65,565 | 68,047 | ||||||||||||
Total finance lease liabilities | $ | 69,318 | $ | 71,760 | ||||||||||
Weighted average remaining lease term (in years): | ||||||||||||||
Operating leases | 5.8 | 5.9 | ||||||||||||
Finance leases | 15.2 | 15.9 | ||||||||||||
Weighted average discount rate: | ||||||||||||||
Operating leases | 4.8% | 4.8% | ||||||||||||
Finance leases | 5.6% | 5.6% |
Nine Months Ended
September 30, |
||||||||||||||||||||
2021 | 2020 | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||||||||||||||||||
Operating cash flows on operating leases | $ | 855 | $ | 773 | ||||||||||||||||
Operating cash flows on finance leases | $ | 3,110 | $ | 3,241 | ||||||||||||||||
Financing cash flows on finance leases | $ | 2,666 | $ | 2,666 |
September 30, 2021 | ||||||||||||||
Operating | Finance | |||||||||||||
(In thousands) | ||||||||||||||
2021 | $ | 262 | $ | 1,832 | ||||||||||
2022 | 690 | 7,335 | ||||||||||||
2023 | 603 | 7,374 | ||||||||||||
2024 | 497 | 6,929 | ||||||||||||
2025 | 429 | 6,470 | ||||||||||||
2026 and thereafter | 787 | 73,888 | ||||||||||||
Total lease payments | 3,268 | 103,828 | ||||||||||||
Less: Imputed interest | (393) | (34,510) | ||||||||||||
Total lease obligations | 2,875 | 69,318 | ||||||||||||
Less: Current lease liabilities | (706) | (3,753) | ||||||||||||
Noncurrent lease liabilities | $ | 2,169 | $ | 65,565 |
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Operating lease costs | $ | 260 | $ | 242 | $ | 807 | $ | 745 | ||||||||||||||||||
Finance lease costs | ||||||||||||||||||||||||||
Amortization of assets | 195 | 251 | 607 | 766 | ||||||||||||||||||||||
Interest on lease liabilities | 983 | 1,032 | 2,983 | 3,108 | ||||||||||||||||||||||
Variable lease cost | 43 | 64 | 175 | 159 | ||||||||||||||||||||||
Total net lease cost | $ | 1,481 | $ | 1,589 | $ | 4,572 | $ | 4,778 |
Nine Months Ended September 30, 2021 | ||||||||
(In thousands) | ||||||||
Net investment in leases | $ | 143,720 | ||||||
Properties and equipment, net | (125,602) | |||||||
Deferred revenue | 6,559 | |||||||
Gain on sales-type leases | $ | 24,677 |
Nine Months Ended September 30, 2020 | ||||||||
(In thousands) | ||||||||
Net investment in lease | $ | 35,319 | ||||||
Properties and equipment, net | (1,485) | |||||||
Gain on sales-type lease | $ | 33,834 |
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Operating lease revenues | $ | 80,907 | $ | 87,125 | $ | 251,605 | $ | 262,518 | ||||||||||||||||||
Direct financing lease interest income | 521 | 525 | 1,568 | 1,572 | ||||||||||||||||||||||
Gain on sales-type leases | — | — | 24,677 | 33,834 | ||||||||||||||||||||||
Sales-type lease interest income | 6,313 | 2,278 | 18,429 | 6,218 | ||||||||||||||||||||||
Lease revenues relating to variable lease payments not included in measurement of the sales-type lease receivable | 3,167 | 2,952 | 7,272 | 7,413 |
Operating | Finance | Sales-type | ||||||||||||||||||
Years Ending December 31, | (In thousands) | |||||||||||||||||||
Remainder of 2021 | $ | 71,001 | $ | 544 | $ | 10,525 | ||||||||||||||
2022 | 283,916 | 2,171 | 42,102 | |||||||||||||||||
2023 | 253,459 | 2,175 | 38,196 | |||||||||||||||||
2024 | 217,355 | 2,192 | 34,967 | |||||||||||||||||
2025 | 153,934 | 2,209 | 31,539 | |||||||||||||||||
2026 and thereafter | 558,415 | 38,837 | 279,406 | |||||||||||||||||
Total lease receipt payments | $ | 1,538,080 | $ | 48,128 | $ | 436,735 | ||||||||||||||
Less: Imputed interest | (31,734) | (367,089) | ||||||||||||||||||
16,394 | 69,646 | |||||||||||||||||||
Unguaranteed residual assets at end of leases | — | 224,779 | ||||||||||||||||||
Net investment in leases | $ | 16,394 | $ | 294,425 |
September 30, 2021 | December 31, 2020 | |||||||||||||||||||||||||
Sales-type Leases | Direct Financing Leases | Sales-type Leases | Direct Financing Leases | |||||||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||||
Lease receivables (1)
|
$ | 211,053 | $ | 16,394 | $ | 88,922 | $ | 16,452 | ||||||||||||||||||
Unguaranteed residual assets | 83,372 | — | 64,551 | — | ||||||||||||||||||||||
Net investment in leases | $ | 294,425 | $ | 16,394 | $ | 153,473 | $ | 16,452 |
September 30, 2021 | December 31, 2020 | |||||||||||||||||||||||||||||||
Financial Instrument | Fair Value Input Level |
Carrying
Value |
Fair Value |
Carrying
Value |
Fair Value | |||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||
5% Senior Notes
|
Level 2 | 492,809 | 506,770 | 492,103 | 506,540 |
September 30,
2021 |
December 31,
2020 |
|||||||||||||
(In thousands) | ||||||||||||||
Pipelines, terminals and tankage(1)
|
$ | 1,545,545 | $ | 1,575,815 | ||||||||||
Refinery assets | 348,882 | 348,882 | ||||||||||||
Land and right of way | 86,781 | 87,076 | ||||||||||||
Construction in progress | 14,878 | 58,467 | ||||||||||||
Other(1)
|
43,876 | 46,201 | ||||||||||||
2,039,962 | 2,116,441 | |||||||||||||
Less accumulated depreciation | (704,920) | (665,756) | ||||||||||||
$ | 1,335,042 | $ | 1,450,685 |
Useful Life |
September 30,
2021 |
December 31,
2020 |
||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Delek transportation agreement |
30 years
|
$ | 59,933 | $ | 59,933 | |||||||||||||||
HFC transportation agreement |
10-15 years
|
75,131 | 75,131 | |||||||||||||||||
Customer relationships |
10 years
|
69,683 | 69,683 | |||||||||||||||||
Other |
20 years
|
50 | 50 | |||||||||||||||||
204,797 | 204,797 | |||||||||||||||||||
Less accumulated amortization | (127,988) | (117,482) | ||||||||||||||||||
$ | 76,809 | $ | 87,315 |
Phantom Units | Units | Weighted Average Grant-Date Fair Value | ||||||||||||
Outstanding at January 1, 2021 (nonvested) | 295,992 | $ | 14.48 | |||||||||||
Vesting and transfer of full ownership to recipients | (823) | 16.24 | ||||||||||||
Forfeited | (6,833) | 15.54 | ||||||||||||
Outstanding at September 30, 2021 (nonvested) | 288,336 | 14.45 |
Performance Units | Units | |||||||
Outstanding at January 1, 2021 (nonvested) | 77,472 | |||||||
Vesting and transfer of common units to recipients | (10,881) | |||||||
Outstanding at September 30, 2021 (nonvested) | 66,591 |
September 30,
2021 |
December 31,
2020 |
|||||||||||||
(In thousands) | ||||||||||||||
Credit Agreement | ||||||||||||||
Amount outstanding | $ | 840,500 | 913,500 | |||||||||||
5% Senior Notes
|
||||||||||||||
Principal | 500,000 | 500,000 | ||||||||||||
Unamortized premium and debt issuance costs | (7,191) | (7,897) | ||||||||||||
492,809 | 492,103 | |||||||||||||
Total long-term debt | $ | 1,333,309 | $ | 1,405,603 |
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
(In thousands, except per unit data) | ||||||||||||||||||||||||||
Net income attributable to the partners | $ | 49,160 | $ | 17,813 | $ | 169,302 | $ | 119,144 | ||||||||||||||||||
Less: Participating securities’ share in earnings | (165) | — | (579) | — | ||||||||||||||||||||||
Net income attributable to common units | 48,995 | 17,813 | 168,723 | 119,144 | ||||||||||||||||||||||
Weighted average limited partners' units outstanding | 105,440 | 105,440 | 105,440 | 105,440 | ||||||||||||||||||||||
Limited partners' per unit interest in earnings - basic and diluted | $ | 0.46 | $ | 0.17 | $ | 1.60 | $ | 1.13 |
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||
Pipelines and terminals - affiliate | $ | 75,211 | $ | 80,589 | $ | 232,756 | $ | 238,123 | ||||||||||||||||||
Pipelines and terminals - third-party | 25,460 | 26,739 | 77,810 | 72,409 | ||||||||||||||||||||||
Refinery processing units - affiliate | 21,913 | 20,403 | 65,436 | 59,860 | ||||||||||||||||||||||
Total segment revenues | $ | 122,584 | $ | 127,731 | $ | 376,002 | $ | 370,392 | ||||||||||||||||||
Segment operating income: | ||||||||||||||||||||||||||
Pipelines and terminals (1)
|
$ | 48,268 | $ | 15,912 | $ | 139,143 | $ | 120,445 | ||||||||||||||||||
Refinery processing units | 9,697 | 9,973 | 27,705 | 29,371 | ||||||||||||||||||||||
Total segment operating income | 57,965 | 25,885 | 166,848 | 149,816 | ||||||||||||||||||||||
Unallocated general and administrative expenses | (3,849) | (2,332) | (9,664) | (7,569) | ||||||||||||||||||||||
Interest and financing costs, net | (6,582) | (11,301) | (20,598) | (37,816) | ||||||||||||||||||||||
Loss on early extinguishment of debt | — | — | — | (25,915) | ||||||||||||||||||||||
Equity in earnings of equity method investments | 3,689 | 1,316 | 8,875 | 5,186 | ||||||||||||||||||||||
Gain on sales-type leases | — | — | 24,677 | 33,834 | ||||||||||||||||||||||
Gain (loss) on sale of assets and other | 77 | 7,465 | 5,994 | 8,439 | ||||||||||||||||||||||
Income before income taxes | $ | 51,300 | $ | 21,033 | $ | 176,132 | $ | 125,975 | ||||||||||||||||||
Capital Expenditures: | ||||||||||||||||||||||||||
Pipelines and terminals | $ | 19,049 | $ | 7,902 | $ | 77,826 | $ | 38,318 | ||||||||||||||||||
Refinery processing units | 168 | — | 766 | 324 | ||||||||||||||||||||||
Total capital expenditures | $ | 19,217 | $ | 7,902 | $ | 78,592 | $ | 38,642 | ||||||||||||||||||
September 30, 2021 | December 31, 2020 | |||||||||||||
(In thousands) | ||||||||||||||
Identifiable assets: | ||||||||||||||
Pipelines and terminals (2)
|
$ | 1,728,983 | $ | 1,729,547 | ||||||||||
Refinery processing units | 291,838 | 305,090 | ||||||||||||
Other | 131,755 | 132,928 | ||||||||||||
Total identifiable assets | $ | 2,152,576 | $ | 2,167,565 |
September 30, 2021 | Parent |
Guarantor
Restricted Subsidiaries |
Non-Guarantor Non-Restricted Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 350 | $ | (346) | $ | 12,812 | $ | — | $ | 12,816 | ||||||||||||||||||||||
Accounts receivable | — | 47,696 | 5,968 | (36) | 53,628 | |||||||||||||||||||||||||||
Prepaid and other current assets | 151 | 7,447 | 868 | (292) | 8,174 | |||||||||||||||||||||||||||
Total current assets | 501 | 54,797 | 19,648 | (328) | 74,618 | |||||||||||||||||||||||||||
Properties and equipment, net | — | 1,030,270 | 304,772 | — | 1,335,042 | |||||||||||||||||||||||||||
Operating lease right-of-use assets | — | 2,397 | 104 | — | 2,501 | |||||||||||||||||||||||||||
Net investment in leases | — | 306,069 | 95,458 | (95,456) | 306,071 | |||||||||||||||||||||||||||
Investment in subsidiaries
|
1,774,250 | 297,809 | — | (2,072,059) | — | |||||||||||||||||||||||||||
Intangible assets, net | — | 76,809 | — | — | 76,809 | |||||||||||||||||||||||||||
Goodwill | — | 223,650 | — | — | 223,650 | |||||||||||||||||||||||||||
Equity method investments | — | 79,337 | 37,690 | — | 117,027 | |||||||||||||||||||||||||||
Other assets | 8,643 | 8,215 | — | — | 16,858 | |||||||||||||||||||||||||||
Total assets | $ | 1,783,394 | $ | 2,079,353 | $ | 457,672 | $ | (2,167,843) | $ | 2,152,576 | ||||||||||||||||||||||
LIABILITIES AND EQUITY | ||||||||||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||||||||||
Accounts payable | $ | — | $ | 28,150 | $ | 11,963 | $ | (36) | $ | 40,077 | ||||||||||||||||||||||
Accrued interest | 4,604 | — | — | — | 4,604 | |||||||||||||||||||||||||||
Deferred revenue | — | 10,287 | 481 | — | 10,768 | |||||||||||||||||||||||||||
Accrued property taxes | — | 5,576 | 3,301 | — | 8,877 | |||||||||||||||||||||||||||
Current operating lease liabilities | — | 632 | 74 | — | 706 | |||||||||||||||||||||||||||
Current finance lease liabilities | — | 5,533 | — | (1,780) | 3,753 | |||||||||||||||||||||||||||
Other current liabilities | — | 2,302 | 385 | — | 2,687 | |||||||||||||||||||||||||||
Total current liabilities | 4,604 | 52,480 | 16,204 | (1,816) | 71,472 | |||||||||||||||||||||||||||
Long-term debt | 1,333,309 | — | — | — | 1,333,309 | |||||||||||||||||||||||||||
Noncurrent operating lease liabilities | — | 2,169 | — | — | 2,169 | |||||||||||||||||||||||||||
Noncurrent finance lease liabilities | — | 152,310 | — | (86,745) | 65,565 | |||||||||||||||||||||||||||
Other long-term liabilities | 260 | 11,631 | 426 | — | 12,317 | |||||||||||||||||||||||||||
Deferred revenue | — | 30,920 | — | — | 30,920 | |||||||||||||||||||||||||||
Class B unit | — | 55,593 | — | — | 55,593 | |||||||||||||||||||||||||||
Equity - partners | 445,221 | 1,774,250 | 297,809 | (2,079,282) | 437,998 | |||||||||||||||||||||||||||
Equity - noncontrolling interests | — | — | 143,233 | — | 143,233 | |||||||||||||||||||||||||||
Total liabilities and equity | $ | 1,783,394 | $ | 2,079,353 | $ | 457,672 | $ | (2,167,843) | $ | 2,152,576 |
December 31, 2020 | Parent |
Guarantor
Restricted Subsidiaries |
Non-Guarantor Non-Restricted Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||||||||||||
Current assets: | ||||||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 1,627 | $ | (987) | $ | 21,350 | $ | — | $ | 21,990 | ||||||||||||||||||||||
Accounts receivable | — | 56,522 | 6,308 | (315) | 62,515 | |||||||||||||||||||||||||||
Prepaid and other current assets | 349 | 8,366 | 772 | — | 9,487 | |||||||||||||||||||||||||||
Total current assets | 1,976 | 63,901 | 28,430 | (315) | 93,992 | |||||||||||||||||||||||||||
Properties and equipment, net | — | 1,087,184 | 363,501 | — | 1,450,685 | |||||||||||||||||||||||||||
Operating lease right-of-use assets | — | 2,822 | 157 | — | 2,979 | |||||||||||||||||||||||||||
Net investment in leases | — | 166,316 | — | — | 166,316 | |||||||||||||||||||||||||||
Investment in subsidiaries | 1,789,808 | 286,883 | — | (2,076,691) | — | |||||||||||||||||||||||||||
Intangible assets, net | — | 87,315 | — | — | 87,315 | |||||||||||||||||||||||||||
Goodwill | — | 234,684 | — | — | 234,684 | |||||||||||||||||||||||||||
Equity method investments | — | 81,089 | 39,455 | — | 120,544 | |||||||||||||||||||||||||||
Other assets | 4,268 | 6,782 | — | — | 11,050 | |||||||||||||||||||||||||||
Total assets | $ | 1,796,052 | $ | 2,016,976 | $ | 431,543 | $ | (2,077,006) | $ | 2,167,565 | ||||||||||||||||||||||
LIABILITIES AND EQUITY | ||||||||||||||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||||||||||||||
Accounts payable | $ | — | $ | 30,252 | $ | 16,463 | $ | (315) | $ | 46,400 | ||||||||||||||||||||||
Accrued interest | 10,892 | — | — | — | 10,892 | |||||||||||||||||||||||||||
Deferred revenue | — | 10,868 | 500 | — | 11,368 | |||||||||||||||||||||||||||
Accrued property taxes | — | 2,915 | 1,077 | — | 3,992 | |||||||||||||||||||||||||||
Current operating lease liabilities | — | 804 | 71 | — | 875 | |||||||||||||||||||||||||||
Current finance lease liabilities | — | 3,713 | — | — | 3,713 | |||||||||||||||||||||||||||
Other current liabilities | 5 | 2,491 | 9 | — | 2,505 | |||||||||||||||||||||||||||
Total current liabilities | 10,897 | 51,043 | 18,120 | (315) | 79,745 | |||||||||||||||||||||||||||
Long-term debt | 1,405,603 | — | — | — | 1,405,603 | |||||||||||||||||||||||||||
Noncurrent operating lease liabilities | — | 2,476 | — | — | 2,476 | |||||||||||||||||||||||||||
Noncurrent finance lease liabilities | — | 68,047 | — | — | 68,047 | |||||||||||||||||||||||||||
Other long-term liabilities | 260 | 12,171 | 474 | — | 12,905 | |||||||||||||||||||||||||||
Deferred revenue | — | 40,581 | — | — | 40,581 | |||||||||||||||||||||||||||
Class B unit | — | 52,850 | — | — | 52,850 | |||||||||||||||||||||||||||
Equity - partners | 379,292 | 1,789,808 | 286,883 | (2,076,691) | 379,292 | |||||||||||||||||||||||||||
Equity - noncontrolling interests | — | — | 126,066 | — | 126,066 | |||||||||||||||||||||||||||
Total liabilities and equity | $ | 1,796,052 | $ | 2,016,976 | $ | 431,543 | $ | (2,077,006) | $ | 2,167,565 |
Three Months Ended September 30, 2021 | Parent |
Guarantor Restricted
Subsidiaries |
Non-Guarantor Non-Restricted Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||
Affiliates | $ | — | $ | 90,980 | $ | 6,144 | $ | — | $ | 97,124 | ||||||||||||||||||||||
Third parties | — | 20,024 | 5,436 | — | 25,460 | |||||||||||||||||||||||||||
— | 111,004 | 11,580 | — | 122,584 | ||||||||||||||||||||||||||||
Operating costs and expenses: | ||||||||||||||||||||||||||||||||
Operations (exclusive of depreciation and amortization)
|
— | 38,676 | 4,117 | — | 42,793 | |||||||||||||||||||||||||||
Depreciation and amortization | — | 17,558 | 4,268 | — | 21,826 | |||||||||||||||||||||||||||
General and administrative | 739 | 3,110 | — | — | 3,849 | |||||||||||||||||||||||||||
739 | 59,344 | 8,385 | — | 68,468 | ||||||||||||||||||||||||||||
Operating income (loss) | (739) | 51,660 | 3,195 | — | 54,116 | |||||||||||||||||||||||||||
Other income (expense): | ||||||||||||||||||||||||||||||||
Equity in earnings of subsidiaries | 69,553 | 3,045 | — | (72,598) | — | |||||||||||||||||||||||||||
Equity in earnings of equity method investments | — | 2,743 | 946 | — | 3,689 | |||||||||||||||||||||||||||
Interest expense | (12,431) | (1,077) | — | 91 | (13,417) | |||||||||||||||||||||||||||
Interest income | — | 6,835 | 91 | (91) | 6,835 | |||||||||||||||||||||||||||
Gain on sales-type lease | — | 7,223 | — | (7,223) | — | |||||||||||||||||||||||||||
Gain on sale of assets and other | — | 76 | 1 | — | 77 | |||||||||||||||||||||||||||
57,122 | 18,845 | 1,038 | (79,821) | (2,816) | ||||||||||||||||||||||||||||
Income before income taxes | 56,383 | 70,505 | 4,233 | (79,821) | 51,300 | |||||||||||||||||||||||||||
State income tax benefit | — | 4 | — | — | 4 | |||||||||||||||||||||||||||
Net income | 56,383 | 70,509 | 4,233 | (79,821) | 51,304 | |||||||||||||||||||||||||||
Allocation of net income attributable to noncontrolling interests
|
— | (956) | (1,188) | — | (2,144) | |||||||||||||||||||||||||||
Net income attributable to the partners
|
$ | 56,383 | $ | 69,553 | $ | 3,045 | $ | (79,821) | $ | 49,160 |
Three Months Ended September 30, 2020 | Parent |
Guarantor
Restricted Subsidiaries |
Non-Guarantor Non-Restricted Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||
Affiliates | $ | — | $ | 94,595 | $ | 6,397 | $ | — | $ | 100,992 | ||||||||||||||||||||||
Third parties | — | 21,550 | 5,189 | — | 26,739 | |||||||||||||||||||||||||||
— | 116,145 | 11,586 | — | 127,731 | ||||||||||||||||||||||||||||
Operating costs and expenses: | ||||||||||||||||||||||||||||||||
Operations (exclusive of depreciation and amortization)
|
— | 36,065 | 3,938 | — | 40,003 | |||||||||||||||||||||||||||
Depreciation and amortization | — | 21,997 | 4,193 | — | 26,190 | |||||||||||||||||||||||||||
General and administrative | 649 | 1,683 | — | — | 2,332 | |||||||||||||||||||||||||||
Goodwill impairment | — | 35,653 | — | — | 35,653 | |||||||||||||||||||||||||||
649 | 95,398 | 8,131 | — | 104,178 | ||||||||||||||||||||||||||||
Operating income (loss) | (649) | 20,747 | 3,455 | — | 23,553 | |||||||||||||||||||||||||||
Other income (expense): | ||||||||||||||||||||||||||||||||
Equity in earnings of subsidiaries | 31,461 | 6,589 | — | (38,050) | — | |||||||||||||||||||||||||||
Equity in earnings of equity method investments | — | 755 | 561 | — | 1,316 | |||||||||||||||||||||||||||
Interest expense | (13,072) | (1,032) | — | — | (14,104) | |||||||||||||||||||||||||||
Interest income | — | 2,787 | 16 | — | 2,803 | |||||||||||||||||||||||||||
Gain on sale of assets and other | 73 | 2,542 | 4,850 | — | 7,465 | |||||||||||||||||||||||||||
18,462 | 11,641 | 5,427 | (38,050) | (2,520) | ||||||||||||||||||||||||||||
Income before income taxes | 17,813 | 32,388 | 8,882 | (38,050) | 21,033 | |||||||||||||||||||||||||||
State income tax expense | — | (34) | — | — | (34) | |||||||||||||||||||||||||||
Net income | 17,813 | 32,354 | 8,882 | (38,050) | 20,999 | |||||||||||||||||||||||||||
Allocation of net income attributable to noncontrolling interests
|
— | (893) | (2,293) | — | (3,186) | |||||||||||||||||||||||||||
Net income attributable to the partners
|
$ | 17,813 | $ | 31,461 | $ | 6,589 | $ | (38,050) | $ | 17,813 | ||||||||||||||||||||||
Nine Months Ended September 30, 2021 | Parent |
Guarantor Restricted
Subsidiaries |
Non-Guarantor Non-Restricted Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||
Affiliates | $ | — | $ | 279,592 | $ | 18,600 | $ | — | $ | 298,192 | ||||||||||||||||||||||
Third parties | — | 59,554 | 18,256 | — | 77,810 | |||||||||||||||||||||||||||
— | 339,146 | 36,856 | — | 376,002 | ||||||||||||||||||||||||||||
Operating costs and expenses: | ||||||||||||||||||||||||||||||||
Operations (exclusive of depreciation and amortization)
|
— | 114,217 | 12,009 | — | 126,226 | |||||||||||||||||||||||||||
Depreciation and amortization | — | 59,045 | 12,849 | — | 71,894 | |||||||||||||||||||||||||||
General and administrative | 2,824 | 6,840 | — | — | 9,664 | |||||||||||||||||||||||||||
Goodwill impairment | — | 11,034 | — | — | 11,034 | |||||||||||||||||||||||||||
2,824 | 191,136 | 24,858 | — | 218,818 | ||||||||||||||||||||||||||||
Operating income (loss) | (2,824) | 148,010 | 11,998 | — | 157,184 | |||||||||||||||||||||||||||
Other income (expense): | ||||||||||||||||||||||||||||||||
Equity in earnings of subsidiaries | 216,958 | 10,786 | — | (227,744) | — | |||||||||||||||||||||||||||
Equity in earnings of equity method investments | — | 6,154 | 2,721 | — | 8,875 | |||||||||||||||||||||||||||
Interest expense | (37,609) | (3,077) | — | 91 | (40,595) | |||||||||||||||||||||||||||
Interest income | — | 19,997 | 91 | (91) | 19,997 | |||||||||||||||||||||||||||
Gain on sales-type lease | — | 31,900 | — | (7,223) | 24,677 | |||||||||||||||||||||||||||
Gain on sale of assets and other | — | 5,991 | 3 | — | 5,994 | |||||||||||||||||||||||||||
179,349 | 71,751 | 2,815 | (234,967) | 18,948 | ||||||||||||||||||||||||||||
Income before income taxes | 176,525 | 219,761 | 14,813 | (234,967) | 176,132 | |||||||||||||||||||||||||||
State income tax expense | — | (60) | — | — | (60) | |||||||||||||||||||||||||||
Net income | 176,525 | 219,701 | 14,813 | (234,967) | 176,072 | |||||||||||||||||||||||||||
Allocation of net income attributable to noncontrolling interests
|
— | (2,743) | (4,027) | — | (6,770) | |||||||||||||||||||||||||||
Net income attributable to the partners
|
$ | 176,525 | $ | 216,958 | $ | 10,786 | $ | (234,967) | $ | 169,302 |
Nine Months Ended September 30, 2020 | Parent |
Guarantor Restricted
Subsidiaries |
Non-Guarantor Non-Restricted Subsidiaries | Eliminations | Consolidated | |||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||
Affiliates | $ | — | $ | 278,767 | $ | 19,216 | $ | — | $ | 297,983 | ||||||||||||||||||||||
Third parties | — | 56,592 | 15,817 | — | 72,409 | |||||||||||||||||||||||||||
— | 335,359 | 35,033 | — | 370,392 | ||||||||||||||||||||||||||||
Operating costs and expenses: | ||||||||||||||||||||||||||||||||
Operations (exclusive of depreciation and amortization)
|
— | 98,176 | 11,545 | — | 109,721 | |||||||||||||||||||||||||||
Depreciation and amortization | — | 62,489 | 12,713 | — | 75,202 | |||||||||||||||||||||||||||
General and administrative | 2,528 | 5,041 | — | — | 7,569 | |||||||||||||||||||||||||||
Goodwill impairment | — | 35,653 | — | — | 35,653 | |||||||||||||||||||||||||||
2,528 | 201,359 | 24,258 | — | 228,145 | ||||||||||||||||||||||||||||
Operating income (loss) | (2,528) | 134,000 | 10,775 | — | 142,247 | |||||||||||||||||||||||||||
Other income (expense): | ||||||||||||||||||||||||||||||||
Equity in earnings of subsidiaries | 189,889 | 12,394 | — | (202,283) | — | |||||||||||||||||||||||||||
Equity in earnings of equity method investments | — | 4,292 | 894 | — | 5,186 | |||||||||||||||||||||||||||
Interest expense | (42,542) | (3,108) | — | — | (45,650) | |||||||||||||||||||||||||||
Interest income | 26 | 7,792 | 16 | — | 7,834 | |||||||||||||||||||||||||||
Loss on early extinguishment of debt | (25,915) | — | — | — | (25,915) | |||||||||||||||||||||||||||
Gain on sales-type lease | — | 33,834 | — | — | 33,834 | |||||||||||||||||||||||||||
Gain on sale of assets and other | 214 | 3,358 | 4,867 | — | 8,439 | |||||||||||||||||||||||||||
121,672 | 58,562 | 5,777 | (202,283) | (16,272) | ||||||||||||||||||||||||||||
Income before income taxes | 119,144 | 192,562 | 16,552 | (202,283) | 125,975 | |||||||||||||||||||||||||||
State income tax expense | — | (110) | — | — | (110) | |||||||||||||||||||||||||||
Net income | 119,144 | 192,452 | 16,552 | (202,283) | 125,865 | |||||||||||||||||||||||||||
Allocation of net income attributable to noncontrolling interests
|
— | (2,563) | (4,158) | — | (6,721) | |||||||||||||||||||||||||||
Net income attributable to the partners
|
$ | 119,144 | $ | 189,889 | $ | 12,394 | $ | (202,283) | $ | 119,144 |
Three Months Ended September 30, | Change from | |||||||||||||||||||
2021 | 2020 | 2020 | ||||||||||||||||||
(In thousands, except per unit data) | ||||||||||||||||||||
Revenues: | ||||||||||||||||||||
Pipelines: | ||||||||||||||||||||
Affiliates—refined product pipelines | $ | 18,702 | $ | 18,619 | $ | 83 | ||||||||||||||
Affiliates—intermediate pipelines | 7,537 | 7,537 | — | |||||||||||||||||
Affiliates—crude pipelines | 19,536 | 20,218 | (682) | |||||||||||||||||
45,775 | 46,374 | (599) | ||||||||||||||||||
Third parties—refined product pipelines | 8,799 | 9,812 | (1,013) | |||||||||||||||||
Third parties—crude pipelines | 12,780 | 12,106 | 674 | |||||||||||||||||
67,354 | 68,292 | (938) | ||||||||||||||||||
Terminals, tanks and loading racks: | ||||||||||||||||||||
Affiliates | 29,436 | 34,215 | (4,779) | |||||||||||||||||
Third parties | 3,881 | 4,821 | (940) | |||||||||||||||||
33,317 | 39,036 | (5,719) | ||||||||||||||||||
Refinery processing units—Affiliates | 21,913 | 20,403 | 1,510 | |||||||||||||||||
Total revenues | 122,584 | 127,731 | (5,147) | |||||||||||||||||
Operating costs and expenses: | ||||||||||||||||||||
Operations (exclusive of depreciation and amortization) | 42,793 | 40,003 | 2,790 | |||||||||||||||||
Depreciation and amortization | 21,826 | 26,190 | (4,364) | |||||||||||||||||
General and administrative | 3,849 | 2,332 | 1,517 | |||||||||||||||||
Goodwill impairment | — | 35,653 | (35,653) | |||||||||||||||||
68,468 | 104,178 | (35,710) | ||||||||||||||||||
Operating income | 54,116 | 23,553 | 30,563 | |||||||||||||||||
Other income (expense): | ||||||||||||||||||||
Equity in earnings of equity method investments | 3,689 | 1,316 | 2,373 | |||||||||||||||||
Interest expense, including amortization | (13,417) | (14,104) | 687 | |||||||||||||||||
Interest income | 6,835 | 2,803 | 4,032 | |||||||||||||||||
Gain on sale of assets and other | 77 | 7,465 | (7,388) | |||||||||||||||||
(2,816) | (2,520) | (296) | ||||||||||||||||||
Income before income taxes | 51,300 | 21,033 | 30,267 | |||||||||||||||||
State income tax benefit (expense) | 4 | (34) | 38 | |||||||||||||||||
Net income | 51,304 | 20,999 | 30,305 | |||||||||||||||||
Allocation of net income attributable to noncontrolling interests | (2,144) | (3,186) | 1,042 | |||||||||||||||||
Net income attributable to the partners | 49,160 | 17,813 | 31,347 | |||||||||||||||||
Limited partners’ earnings per unit—basic and diluted | $ | 0.46 | $ | 0.17 | $ | 0.29 | ||||||||||||||
Weighted average limited partners’ units outstanding | 105,440 | 105,440 | — | |||||||||||||||||
EBITDA (1)
|
$ | 77,564 | $ | 55,338 | $ | 22,226 | ||||||||||||||
Adjusted EBITDA (1)
|
$ | 83,270 | $ | 86,435 | $ | (3,165) | ||||||||||||||
Distributable cash flow (2)
|
$ | 66,810 | $ | 76,894 | $ | (10,084) | ||||||||||||||
Volumes (bpd) | ||||||||||||||||||||
Pipelines: | ||||||||||||||||||||
Affiliates—refined product pipelines | 115,507 | 119,403 | (3,896) | |||||||||||||||||
Affiliates—intermediate pipelines | 136,398 | 142,817 | (6,419) | |||||||||||||||||
Affiliates—crude pipelines | 271,717 | 270,840 | 877 | |||||||||||||||||
523,622 | 533,060 | (9,438) | ||||||||||||||||||
Third parties—refined product pipelines | 46,834 | 60,203 | (13,369) | |||||||||||||||||
Third parties—crude pipelines | 136,247 | 133,487 | 2,760 | |||||||||||||||||
706,703 | 726,750 | (20,047) | ||||||||||||||||||
Terminals and loading racks: | ||||||||||||||||||||
Affiliates | 419,665 | 401,904 | 17,761 | |||||||||||||||||
Third parties | 52,541 | 57,355 | (4,814) | |||||||||||||||||
472,206 | 459,259 | 12,947 | ||||||||||||||||||
Refinery processing units—Affiliates | 72,297 | 62,016 | 10,281 | |||||||||||||||||
Total for pipelines and terminal and refinery processing unit assets (bpd) | 1,251,206 | 1,248,025 | 3,181 |
Nine Months Ended September 30, | Change from | |||||||||||||||||||
2021 | 2020 | 2020 | ||||||||||||||||||
(In thousands, except per unit data) | ||||||||||||||||||||
Revenues: | ||||||||||||||||||||
Pipelines: | ||||||||||||||||||||
Affiliates—refined product pipelines | $ | 56,520 | $ | 55,004 | $ | 1,516 | ||||||||||||||
Affiliates—intermediate pipelines | 22,564 | 22,486 | 78 | |||||||||||||||||
Affiliates—crude pipelines | 58,241 | 59,922 | (1,681) | |||||||||||||||||
137,325 | 137,412 | (87) | ||||||||||||||||||
Third parties—refined product pipelines | 28,188 | 33,360 | (5,172) | |||||||||||||||||
Third parties—crude pipelines | 36,667 | 26,946 | 9,721 | |||||||||||||||||
202,180 | 197,718 | 4,462 | ||||||||||||||||||
Terminals, tanks and loading racks: | ||||||||||||||||||||
Affiliates | 95,431 | 100,711 | (5,280) | |||||||||||||||||
Third parties | 12,955 | 12,103 | 852 | |||||||||||||||||
108,386 | 112,814 | (4,428) | ||||||||||||||||||
Refinery processing units—Affiliates | 65,436 | 59,860 | 5,576 | |||||||||||||||||
Total revenues | 376,002 | 370,392 | 5,610 | |||||||||||||||||
Operating costs and expenses: | ||||||||||||||||||||
Operations (exclusive of depreciation and amortization) | 126,226 | 109,721 | 16,505 | |||||||||||||||||
Depreciation and amortization | 71,894 | 75,202 | (3,308) | |||||||||||||||||
General and administrative | 9,664 | 7,569 | 2,095 | |||||||||||||||||
Goodwill impairment | 11,034 | 35,653 | (24,619) | |||||||||||||||||
218,818 | 228,145 | (9,327) | ||||||||||||||||||
Operating income | 157,184 | 142,247 | 14,937 | |||||||||||||||||
Other income (expense): | ||||||||||||||||||||
Equity in earnings of equity method investments | 8,875 | 5,186 | 3,689 | |||||||||||||||||
Interest expense, including amortization | (40,595) | (45,650) | 5,055 | |||||||||||||||||
Interest income | 19,997 | 7,834 | 12,163 | |||||||||||||||||
Loss on early extinguishment of debt | — | (25,915) | 25,915 | |||||||||||||||||
Gain on sales-type leases | 24,677 | 33,834 | (9,157) | |||||||||||||||||
Gain on sale of assets and other | 5,994 | 8,439 | (2,445) | |||||||||||||||||
18,948 | (16,272) | 35,220 | ||||||||||||||||||
Income before income taxes | 176,132 | 125,975 | 50,157 | |||||||||||||||||
State income tax expense | (60) | (110) | 50 | |||||||||||||||||
Net income | 176,072 | 125,865 | 50,207 | |||||||||||||||||
Allocation of net income attributable to noncontrolling interests | (6,770) | (6,721) | (49) | |||||||||||||||||
Net income attributable to the partners | 169,302 | 119,144 | 50,158 | |||||||||||||||||
Limited partners’ earnings per unit—basic and diluted | $ | 1.60 | $ | 1.13 | $ | 0.47 | ||||||||||||||
Weighted average limited partners’ units outstanding | 105,440 | 105,440 | — | |||||||||||||||||
EBITDA (1)
|
$ | 261,854 | $ | 232,272 | $ | 29,582 | ||||||||||||||
Adjusted EBITDA (1)
|
$ | 259,466 | $ | 257,711 | $ | 1,755 | ||||||||||||||
Distributable cash flow (2)
|
$ | 206,707 | $ | 213,058 | $ | (6,351) | ||||||||||||||
Volumes (bpd) | ||||||||||||||||||||
Pipelines: | ||||||||||||||||||||
Affiliates—refined product pipelines | 118,033 | 116,641 | 1,392 | |||||||||||||||||
Affiliates—intermediate pipelines | 131,873 | 137,816 | (5,943) | |||||||||||||||||
Affiliates—crude pipelines | 261,117 | 276,128 | (15,011) | |||||||||||||||||
511,023 | 530,585 | (19,562) | ||||||||||||||||||
Third parties—refined product pipelines | 47,805 | 55,921 | (8,116) | |||||||||||||||||
Third parties—crude pipelines | 131,842 | 103,955 | 27,887 | |||||||||||||||||
690,670 | 690,461 | 209 | ||||||||||||||||||
Terminals and loading racks: | ||||||||||||||||||||
Affiliates | 386,400 | 401,245 | (14,845) | |||||||||||||||||
Third parties | 50,542 | 49,753 | 789 | |||||||||||||||||
436,942 | 450,998 | (14,056) | ||||||||||||||||||
Refinery processing units—Affiliates | 69,904 | 60,573 | 9,331 | |||||||||||||||||
Total for pipelines and terminal and refinery processing unit assets (bpd) | 1,197,516 | 1,202,032 | (4,516) |
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Net income attributable to the partners | $ | 49,160 | $ | 17,813 | $ | 169,302 | $ | 119,144 | ||||||||||||||||||
Add (subtract): | ||||||||||||||||||||||||||
Interest expense | 13,417 | 14,104 | 40,595 | 45,650 | ||||||||||||||||||||||
Interest income | (6,835) | (2,803) | (19,997) | (7,834) | ||||||||||||||||||||||
State income tax (benefit) expense | (4) | 34 | 60 | 110 | ||||||||||||||||||||||
Depreciation and amortization | 21,826 | 26,190 | 71,894 | 75,202 | ||||||||||||||||||||||
EBITDA | $ | 77,564 | $ | 55,338 | $ | 261,854 | $ | 232,272 | ||||||||||||||||||
Loss on early extinguishment of debt | — | — | — | 25,915 | ||||||||||||||||||||||
Gain on sales-type leases | — | — | (24,677) | (33,834) | ||||||||||||||||||||||
Gain on significant asset sales | — | — | (5,263) | — | ||||||||||||||||||||||
Goodwill impairment | — | 35,653 | 11,034 | 35,653 | ||||||||||||||||||||||
HEP's pro-rata share of gain on business interruption insurance settlement | — | (6,079) | — | (6,079) | ||||||||||||||||||||||
Tariffs and fees not included in revenues | 7,312 | 3,129 | 21,337 | 8,603 | ||||||||||||||||||||||
Lease payments not included in operating costs | (1,606) | (1,606) | (4,819) | (4,819) | ||||||||||||||||||||||
Adjusted EBITDA | $ | 83,270 | $ | 86,435 | $ | 259,466 | $ | 257,711 |
Three Months Ended
September 30, |
Nine Months Ended
September 30, |
|||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Net income attributable to the partners | $ | 49,160 | $ | 17,813 | $ | 169,302 | $ | 119,144 | ||||||||||||||||||
Add (subtract): | ||||||||||||||||||||||||||
Depreciation and amortization | 21,826 | 26,190 | 71,894 | 75,202 | ||||||||||||||||||||||
Amortization of discount and deferred debt issuance costs | 763 | 838 | 2,992 | 2,479 | ||||||||||||||||||||||
Loss on early extinguishment of debt
|
— | — | — | 25,915 | ||||||||||||||||||||||
Customer billings greater than revenue recognized | (122) | (198) | (301) | (699) | ||||||||||||||||||||||
Maintenance capital expenditures (3)
|
(3,351) | (1,565) | (8,834) | (5,192) | ||||||||||||||||||||||
Increase in environmental liability | 271 | 29 | 36 | 187 | ||||||||||||||||||||||
Decrease in reimbursable deferred revenue | (2,991) | (3,257) | (10,507) | (9,062) | ||||||||||||||||||||||
Gain on sales-type leases | — | — | (24,677) | (33,834) | ||||||||||||||||||||||
Gain on significant asset sales | — | — | (5,263) | — | ||||||||||||||||||||||
Goodwill impairment | — | 35,653 | 11,034 | 35,653 | ||||||||||||||||||||||
Other | 1,254 | 1,391 | 1,031 | 3,265 | ||||||||||||||||||||||
Distributable cash flow | $ | 66,810 | $ | 76,894 | $ | 206,707 | $ | 213,058 |
September 30,
2021 |
December 31,
2020 |
|||||||||||||
(In thousands) | ||||||||||||||
Balance Sheet Data | ||||||||||||||
Cash and cash equivalents | $ | 12,816 | $ | 21,990 | ||||||||||
Working capital | $ | 3,146 | $ | 14,247 | ||||||||||
Total assets | $ | 2,152,576 | $ | 2,167,565 | ||||||||||
Long-term debt | $ | 1,333,309 | $ | 1,405,603 | ||||||||||
Partners’ equity | $ | 437,998 | $ | 379,292 |
Three Months Ended September 30, | |||||||||||
Equity Method Investment | 2021 | 2020 | |||||||||
(in thousands) | |||||||||||
Osage Pipe Line Company, LLC | $ | 1,090 | $ | 219 | |||||||
Cheyenne Pipeline LLC | 1,654 | 533 | |||||||||
Cushing Connect Terminal Holdings LLC | 945 | 564 | |||||||||
Total | $ | 3,689 | $ | 1,316 |
Nine Months Ended September 30, | |||||||||||
Equity Method Investment | 2021 | 2020 | |||||||||
(in thousands) | |||||||||||
Osage Pipe Line Company, LLC | 2,726 | 1,599 | |||||||||
Cheyenne Pipeline LLC | 3,428 | 2,693 | |||||||||
Cushing Connect Terminal Holdings LLC | 2,721 | 894 | |||||||||
Total | $ | 8,875 | $ | 5,186 |
September 30,
2021 |
December 31,
2020 |
|||||||||||||
(In thousands) | ||||||||||||||
Credit Agreement | $ | 840,500 | 913,500 | |||||||||||
5% Senior Notes | ||||||||||||||
Principal | 500,000 | 500,000 | ||||||||||||
Unamortized debt issuance costs | (7,191) | (7,897) | ||||||||||||
492,809 | 492,103 | |||||||||||||
Total long-term debt | $ | 1,333,309 | $ | 1,405,603 |
Exhibit
Number |
Description | |||||||
2.1† | ||||||||
3.1 | ||||||||
3.2 | ||||||||
3.3 | ||||||||
3.4 | ||||||||
3.5 | ||||||||
3.6 | ||||||||
10.1 |
Second Amendment to Seventh Amended and Restated Master Throughput Agreement, entered into as of July 27, 2021, effective as of May 1, 2021, by and between HollyFrontier Refining & Marketing LLC and Holly Energy Partners – Operating L.P. (incorporated by reference to Exhibit 10.3 of Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2021, File No. 1-32225).
|
|||||||
10.2† | ||||||||
10.3 | ||||||||
10.4*+ | ||||||||
10.5*+ | ||||||||
10.6*+ | ||||||||
10.7*+ | ||||||||
10.8*+ | ||||||||
10.9*+ | ||||||||
10.10+ | ||||||||
31.1* | ||||||||
31.2* | ||||||||
32.1** | ||||||||
32.2** | ||||||||
101++ | The following financial information from Holly Energy Partners, L.P.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 formatted in iXBRL (Inline Extensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Cash Flows, (iv) Consolidated Statement of Partners’ Equity, and (v) Notes to Consolidated Financial Statements. The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document. | |||||||
104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |
* | Filed herewith. | ||||
** | Furnished herewith. | ||||
+ | Constitutes management contracts or compensatory plans or arrangements. | ||||
++ | Filed electronically herewith. | ||||
† | Schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant agrees to furnish supplementally a copy of the omitted schedules and exhibits to the SEC upon request. | ||||
HOLLY ENERGY PARTNERS, L.P. | ||||||||
(Registrant) | ||||||||
By: HEP LOGISTICS HOLDINGS, L.P.
its General Partner |
||||||||
By: HOLLY LOGISTIC SERVICES, L.L.C.
its General Partner |
||||||||
Date: November 3, 2021 | /s/ John Harrison | |||||||
John Harrison | ||||||||
Senior Vice President,
Chief Financial Officer and Treasurer (Principal Financial Officer) |
||||||||
Date: November 3, 2021 | /s/ Kenneth P. Norwood | |||||||
Kenneth P. Norwood | ||||||||
Vice President and Controller
(Principal Accounting Officer) |
1 Year Holly Energy Partners Chart |
1 Month Holly Energy Partners Chart |
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