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-- Distributable cash flow of $49.1 million, down 14% from 2Q08
-- Revenues of $59.5 million, down 21%
-- Net income attributable to the limited partners of $0.07, down 85%
-- Adjusted net income attributable to the limited partners of $0.19, down
59%
-- Distribution of $0.54 per unit, a 4.9% increase
-- Decreased guidance for 2009
-- Distributable cash flow decreased approximately 33%
-- Revenues decreased approximately 25%
Natural Resource Partners L.P. (NYSE: NRP | Quote | Chart | News | PowerRating) today reported that decreased demand for coal led to lower second quarter 2009 results. Distributable cash flow, a non-GAAP measure, decreased 14% to $49.1 million, from the $57.4 million reported for the second quarter of 2008. Primarily due to lower coal demand and a non-cash expense discussed in more detail below, net income attributable to the limited partners decreased $25.1 million to $4.8 million for the second quarter of 2009, compared to $29.9 million for the second quarter last year. Similarly, net income per unit decreased to $0.07 per unit in the second quarter of 2009 from $0.46 for the second quarter of 2008. Net income attributable to the limited partners included an $8.0 million or $0.12 per unit write-off, which was the limited partners' share of an $8.2 million write-off for a terminated lease on a property due to a mine closure. Excluding this non-cash expense, net income attributable to the limited partners would have been $12.8 million or $0.19 per unit. Reconciliations of distributable cash flow and adjusted net income attributable to the limited partners are provided in the tables attached.
Highlights
----------
2Q09 1Q09 2Q08
---- ---- ----
(in thousands except per ton and
per unit)
--------------------------------
Coal production: 11,784 12,482 16,093
Coal royalty revenues: $46,379 $52,607 $60,026
Average coal royalty revenue
per ton: $3.94 $4.21 $3.73
Total revenues: $59,487 $66,733 $75,592
Net income to limited
partners: $4,804 $21,598 $29,920
Average units outstanding
in quarter: 66,946 64,891 64,891
Net income per unit: $0.07 $0.33 $0.46
Distributable cash flow: $49,068 $35,493 $57,359
"Coal fired electric generation is down about 14% year over year because of the recession and low natural gas prices. Similarly metallurgical coal consumption is depressed due to worldwide steel production being at about 50% of capacity. In addition, while some of our lessees have received new mining permits, costs, delays and uncertainties in the permit process persist. These factors have led to production cutbacks and price declines that caused our revenue to drop below our forecast. We expect these conditions to persist through the remainder of 2009. Compared to the first quarter of 2009, we saw both steam and metallurgical production in Central Appalachia decline, while Illinois Basin production increased after a longwall move in the first quarter depressed production. However, we hear from some of our lessees that metallurgical coal has bottomed and if that proves to be true and demand and prices improve, so should our performance," said Nick Carter, President and Chief Operating Officer. "Throughout this period we continue to manage the company for the long term, not the short term. We continue to work to grow NRP and see attractive acquisition opportunities and we remain optimistic about our long-range prospects."
Current Market
One year ago, the worldwide economies were booming and coal prices, particularly metallurgical coal prices, were growing rapidly as well. Over the last six years, global coal consumption has increased 37%, with China increasing its consumption by 97%. In 2008, global coal consumption continued to increase, but at a much slower rate of 3.8%. While coal has been the fastest growing major fuel consumed in the world, weakening economies have temporarily created lower demand for steel and electricity and hence coal. Some improvements in the worldwide economies are beginning to be recognized; however, it will take some time for a full recovery to occur. China has increased imports of metallurgical coal over the last couple of months and for the first time in several months, U.S. furnaces are beginning to come back on line and producing steel.
Guidance
"When we issued guidance earlier this year, neither we nor our lessees could have predicted the drastic impact that the downturn in the economy would have on the coal industry and NRP. While we lack the desired clarity, we believe the new guidance reflects today's market conditions," said Nick Carter.
Due to the continued weak coal market, NRP is lowering its annual guidance for 2009. The updated guidance includes:
-- Distributable cash flow decreased approximately 33% to a range of
approximately $139 million to $165 million.
-- Net income per unit decreased to a range of $0.58 to $0.90 per unit.
Excluding the item written off in the second quarter, which accounts for
a $0.12 per unit reduction, the net income per unit for 2009 would be
$0.70 to $1.02.
-- Coal royalty revenues reduced approximately 27% to a range between $176
million and $196 million.
-- Total revenues decreased approximately 25% to a range between $221
million and $254 million.
Metallurgical coal accounts for 26% of total coal royalty revenues and 20% of production for the revised forecast.
A complete table of all guidance metrics is attached to this release.
Acquisitions and Liquidity
As previously announced, in the second quarter 2009 NRP issued 4,560,000 units for the acquisition of a new property located in Meigs County, Ohio. This property, while currently producing, has not reached full productive capacity and therefore had a negative impact on earnings per unit in the second quarter.
Following the end of the quarter, NRP also acquired an aggregate property located in Texas for a total of $24 million, $9 million of which was paid at closing. Taking into account the full $24 million purchase price, NRP has $276 million available on its credit facility and at quarter-end had $81 million of cash.
"While NRP experienced lower than expected operating results, with the current cash and credit capacity available to NRP, we are well-positioned to weather the current market and also to continue to look at various acquisition opportunities," said Dwight Dunlap, Chief Financial Officer.
Second Quarter 2009 versus First Quarter 2009
Total revenues in the second quarter decreased $7.2 million, or 11% from the first quarter of 2009, primarily due to decreased coal production and coal royalty revenues. Coal production decreased 700 thousand tons, or 6%, while average coal royalty revenue per ton decreased $0.27 per ton, or approximately 6% this quarter.
Distributable cash flow increased 38% from the first quarter 2009 to $49.1 million due to improvements in working capital that offset declines in both production and revenues.
Second Quarter and Six Month Results
Revenues
Second Quarter
Total revenues for the second quarter of 2009 decreased $16.1 million, or 21%, to $59.5 million compared to the same period last year due primarily to decreases in coal royalty revenues. Coal royalty revenues accounted for $13.6 million, or approximately 85% of the decline in total revenues. Coal royalty revenues decreased 23% from the second quarter of 2008 to $46.4 million due to a 27% decrease in coal royalty production, offset modestly by a 6% increase in the combined average royalty revenue per ton.
Production decreased 4.3 million tons from the second quarter last year to 11.8 million tons for the second quarter of 2009 due to decreased production in all regions, particularly in Appalachia. Weak economies worldwide have caused decreased demand for metallurgical coal and with the 14% decline in domestic demand for coal fired electricity and increasing stockpiles at utilities, many of NRP's lessees have reduced production to better meet current demand.
Combined average royalty revenue per ton increased $0.21 to $3.94 from the $3.73 reported for the second quarter last year. Increases occurred in all regions except Central Appalachia and the Northern Powder River Basin. The most dramatic increase occurred in the Illinois Basin, where the partnership experienced a 30% increase to $3.36 per ton due to a higher royalty rate per ton on current production.
Six Months
Total revenues decreased 10% from the first six months of last year to $126.2 million mainly due to a $10.2 million decrease in coal royalty revenues. Coal royalty revenues decreased 9% from the same period last year due to a 6.3 million, or 21%, decrease in production, which was offset somewhat by an increase of $0.51, or 14%, in the combined average royalty revenue per ton to $4.08 in the first half of 2009.
Metallurgical coal accounted for 28% of NRP's coal royalty revenues and 21% of its production for the first half of 2009.
Expenses
Second Quarter
Total expenses increased $3.3 million in the second quarter of 2009 when compared to the same period last year, due to increased depreciation, depletion and amortization offset by lower general and administrative expenses and lower property, franchise and other taxes. Depreciation, depletion and amortization expense increased due to an $8.2 million non-cash write-off of a terminated lease due to a mine closure in the second quarter of 2009.
Six Months
Total expenses for the six month period ending June 30, 2009 increased $5.4 million to $57.1 million over the same period last year. This increase was due to an increase in depreciation, depletion and amortization expense of $3.3 million and an increase of approximately $2.3 million in general and administrative expenses from the six month period last year. While production volumes decreased, NRP's depreciation, depletion and amortization increased due to the $8.2 million write-off described above. The general and administrative expense increased due to additional long-term incentive awards granted.
Net Income Attributable to the Limited Partners
Second Quarter
Second quarter 2009 net income attributable to the limited partners declined $25.1 million to $4.8 million, from the second quarter last year. This amount included the $8.0 million, or $0.12 per unit, limited partners' share of the non-cash write-off of a terminated lease due to a mine closure. Net income per unit decreased to $0.07 versus $0.46 for the same quarter last year. Excluding the write-off described above, the partnership would have reported $0.19 per unit for this quarter. Net income for the second quarter 2009 was also impacted by the 4,560,000 units issued in conjunction with the acquisition discussed earlier.
Six Months
Net income attributable to the limited partners for the six month period ended June 30, 2009 decreased $28.3 million over the same period last year, accounting for a $0.44 decline in net income per unit to $0.40 for the six month period. Excluding the effects of the write-off discussed above, net income per unit would be increased by $0.12 per unit to $0.52 per unit for the six month period. Net income was also impacted by the additional units issued in the second quarter 2009 discussed above.
Distributable Cash Flow
Second Quarter
Distributable cash flow decreased 14% to $49.1 million when compared to the same quarter last year, due to decreases in total revenues and increases in NRP's reserves for scheduled debt payments. The reserve for debt payments increased $3.7 million over second quarter of 2008 due to additional scheduled principal payments on NRP's senior notes coming due in 2010.
Six Months
For the six months ended June 30, 2009 distributable cash flow decreased $7.7 million, or 8%, to $84.6 million due to increased reserves of $7.5 million for scheduled debt payments due in the next twelve months.
Distributions
As reported on July 21, the Board of Directors of NRP's general partner declared a quarterly distribution of $0.54 per unit. This represents a 4.9% increase over the second quarter 2008 and is unchanged from the first quarter 2009.
"In light of the current economy, the NRP Board of Directors opted to maintain the distribution rather than increasing the distribution as we had for the last 23 straight quarters. While NRP has a sufficient cash balance to offset any near term shortfalls in distributable cash flow, this prudent approach will give NRP more options regarding potential acquisitions that may present themselves during these economic times," said Corbin J. Robertson, Chairman and Chief Executive Officer.
Company Profile
Natural Resource Partners L.P. is headquartered in Houston, TX, with its operations headquarters in Huntington, WV. NRP is a master limited partnership that is principally engaged in the business of owning and managing mineral reserve properties. NRP owns coal reserves and coal handling and transportation infrastructure in the three major coal producing regions of the United States: Appalachia, the Illinois Basin and the Powder River Basin. In addition, the partnership owns and manages aggregate reserves in Texas, West Virginia and Washington.
For additional information, please contact Kathy H. Roberts at 713-751-7555 or kroberts@nrplp.com. Further information about NRP is available on the partnership's website at http://www.nrplp.com.
Disclosure of Non-GAAP Financial Measures
Distributable cash flow represents cash flow from operations less actual principal payments and cash reserves set aside for scheduled principal payments on the senior notes. Distributable cash flow is a "non-GAAP financial measure" that is presented because management believes it is a useful adjunct to net cash provided by operating activities under GAAP. Distributable cash flow is a significant liquidity metric that is an indicator of NRP's ability to generate cash flows at a level that can sustain or support an increase in quarterly cash distributions paid to its partners. Distributable cash flow is also the quantitative standard used throughout the investment community with respect to publicly traded partnerships. Distributable cash flow is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing or financing activities. A reconciliation of distributable cash flow to net cash provided by operating activities is included in the tables attached to this release. Distributable cash flow may not be calculated the same for NRP as other companies.
Forward-Looking Statements
This press release may include "forward-looking statements" as defined by the Securities and Exchange Commission. Such statements include the current coal market conditions and borrowing capacity. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the partnership expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements are based on certain assumptions made by the partnership based on its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the partnership. These risks include, but are not limited to, decreases in demand for coal; changes in operating conditions and costs; production cuts by our lessees; commodity prices; unanticipated geologic problems; changes in the legislative or regulatory environment and other factors detailed in Natural Resource Partners' Securities and Exchange Commission filings. Natural Resource Partners L.P. has no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
-Financial statements follow-
Natural Resource Partners L.P.
Operating Statistics
(In thousands except per ton data)
Three Months For the Six Months
Ended Ended
June 30, June 30,
-------- --------
2009 2008 2009 2008
---- ---- ---- ----
(unaudited) (unaudited)
Coal Royalties:
Coal royalty revenues:
Appalachia
Northern $2,890 $4,902 $5,933 $8,405
Central 30,308 42,974 68,186 77,271
Southern 4,809 3,802 9,906 9,300
----- ----- ----- -----
Total Appalachia $38,007 $51,678 $84,025 $94,976
Illinois Basin 6,570 5,923 10,821 8,556
Northern Powder River Basin 1,803 2,425 4,141 5,646
----- ----- ----- -----
Total $46,380 $60,026 $98,987 $109,178
======= ======= ======= ========
Coal royalty production (tons):
Appalachia
Northern 967 1,927 2,066 3,264
Central 6,989 9,629 14,978 18,571
Southern 798 930 1,639 2,224
--- --- ----- -----
Total Appalachia 8,754 12,486 18,683 24,059
Illinois Basin 1,956 2,293 3,282 3,458
Northern Powder River Basin 1,074 1,314 2,301 3,045
----- ----- ----- -----
Total 11,784 16,093 24,266 30,562
====== ====== ====== ======
Average royalty revenue per ton:
Appalachia
Northern $2.99 $2.54 $2.87 $2.58
Central 4.34 4.46 4.55 4.16
Southern 6.03 4.09 6.04 4.18
Total Appalachia 4.34 4.14 4.50 3.95
Illinois Basin 3.36 2.58 3.30 2.47
Northern Powder River Basin 1.68 1.85 1.80 1.85
Combined average royalty
revenue per ton $3.94 $3.73 $4.08 $3.57
Aggregates:
Royalty revenues $1,047 $1,633 $1,977 $3,051
Aggregate royalty bonus $300 $300 $1,020 $2,244
Production: 791 1,238 1,481 2,392
Average base royalty per ton: $1.32 $1.32 $1.33 $1.28
Natural Resource Partners L.P.
Consolidated Statements of Income
(In thousands, except per unit data)
Three Months For the Six Months
Ended Ended
June 30, June 30,
-------- --------
2009 2008 2009 2008
---- ---- ---- ----
(Unaudited) (Unaudited)
Revenues:
Coal royalties $46,380 $60,026 $98,987 $109,178
Aggregate royalties 1,347 1,933 2,997 5,295
Coal processing fees 2,400 1,757 4,300 3,654
Transportation fees 3,489 3,361 5,585 5,010
Oil and gas royalties 953 1,933 2,446 3,378
Property taxes 2,514 3,105 5,725 5,497
Minimums recognized as
revenue 67 149 290 456
Override royalties 1,336 2,006 3,884 4,505
Other 1,001 1,322 2,006 2,674
----- ----- ----- -----
Total revenues 59,487 75,592 126,220 139,647
Operating costs and expenses:
Depreciation, depletion and
amortization 21,996 16,748 35,074 31,807
General and administrative 5,834 6,890 13,340 11,039
Property, franchise and other
taxes 3,151 4,098 7,126 7,747
Transportation costs 473 408 741 529
Coal royalty and override
payments 372 343 861 652
--- --- --- ---
Total operating costs and
expenses 31,826 28,487 57,142 51,774
------ ------ ------ ------
Income from operations 27,661 47,105 69,078 87,873
Other income (expense)
Interest expense (10,675) (7,064) (18,754) (14,424)
Interest income 96 312 178 756
-- --- --- ---
Net income $17,082 $40,353 $50,502 $74,205
======= ======= ======= =======
Net income attributable to:
General partner $98 $611 $539 $1,116
=== ==== ==== ======
Holders of incentive
distribution rights $12,180 $9,822 $23,561 $18,399
======= ====== ======= =======
Limited partners $4,804 $29,920 $26,402 $54,690
====== ======= ======= =======
Basic and diluted net income
per limited partner unit: $0.07 $0.46 $0.40 $0.84
===== ===== ===== =====
Weighted average number of
units outstanding: 66,946 64,891 65,924 64,891
====== ====== ====== ======
Natural Resource Partners L.P.
Statements of Cash Flows
(In thousands)
Three Months For the Six Months
Ended Ended
June 30, June 30,
------------------ ----------------
2009 2008 2009 2008
---- ---- ---- ----
(Unaudited) (Unaudited)
Cash flows from operating
activities:
Net income $17,082 $40,353 $50,502 $74,205
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Depreciation, depletion
and amortization 21,996 16,748 35,074 31,807
Non-cash interest charge 128 117 1,010 235
Loss from disposition of
assets - 32 - 32
Change in operating assets
and liabilities:
Accounts receivable 5,328 (5,252) 1,865 (8,971)
Other assets - 323 267 584
Accounts payable and
accrued liabilities 148 680 (247) 429
Accrued interest 7,054 2,655 3,909 (265)
Deferred revenue 2,798 313 8,310 2,726
Accrued incentive plan
expenses 2,034 4,226 1,568 1,078
Property, franchise and
other taxes payable 559 1,472 (1,579) (990)
--- ----- ------- -----
Net cash provided by
operating activities 57,127 61,667 100,679 100,870
------ ------ ------- -------
Cash flows from investing
activities:
Acquisition of land, coal
and other mineral rights - - (95,641) -
Acquisition or construction
of plant and equipment - (4,654) (1,157) (7,454)
--- ------- ------- -------
Net cash used in
investing activities - (4,654) (96,798) (7,454)
--- ------- -------- -------
Cash flows from financing
activities:
Proceeds from loans - - 303,000 -
Deferred financing costs - - (661) -
Repayments of loans (9,350) (9,350) (160,542) (9,543)
Retirement of purchase
obligation related to
reserve and infrastructure (20,000) - (60,000) -
Costs associated with
issuance of units (21) - (21) -
Distributions to partners (47,370) (41,529) (94,090) (81,760)
-------- -------- -------- --------
Net cash used in
financing activities (76,741) (50,879) (12,314) (91,303)
-------- -------- -------- --------
Net increase or (decrease)
in cash and cash equivalents (19,614) 6,134 (8,433) 2,113
Cash and cash equivalents
at beginning of period 101,109 54,320 89,928 58,341
------- ------ ------ ------
Cash and cash equivalents
at end of period $81,495 $60,454 $81,495 $60,454
======= ======= ======= =======
SUPPLEMENTAL INFORMATION:
Cash paid during the
period for interest $3,480 $4,292 $13,760 $14,450
====== ====== ======= =======
Non-cash investing activities:
Equity issued for
acquisitions $95,910 $- $95,910 $-
Liability assumed in
acquisition 1,170 $- 1,170 $-
Non-cash financing activities:
Purchase obligation
related to reserve and
infrastructure acquisition $- $- $59,220 $-
Natural Resource Partners L.P.
Consolidated Balance Sheets
(In thousands, except for unit information)
ASSETS
June 30, December 31,
2009 2008
---- ----
(unaudited)
Current assets:
Cash and cash equivalents $81,495 $89,928
Accounts receivable, net of allowance for
doubtful accounts 26,293 31,883
Accounts receivable - affiliate 3,906 1,351
Other 704 934
--- ---
Total current assets 112,398 124,096
Land 24,343 24,343
Plant and equipment, net 71,130 67,204
Coal and other mineral rights, net 1,133,023 979,692
Intangible assets 163,610 102,828
Loan financing costs, net 3,120 2,679
Other assets, net 461 498
--- ---
Total assets $1,508,085 $1,301,340
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Current liabilities:
Accounts payable and accrued liabilities $804 $861
Accounts payable - affiliate 175 365
Current portion of long-term debt 32,235 17,235
Accrued incentive plan expenses - current
portion 3,982 3,179
Property, franchise and other taxes payable 4,543 6,122
Accrued interest 10,328 6,419
------ -----
Total current liabilities 52,067 34,181
Deferred revenue 49,064 40,754
Accrued incentive plan expenses 5,007 4,242
Long-term debt 606,280 478,822
Partners' capital:
Common units (69,451,136 in 2009,
64,891,136 in 2008) 769,892 719,341
General partner's interest 14,218 13,579
Holders of incentive distribution rights 12,180 11,069
Accumulated other comprehensive loss (623) (648)
----- -----
Total partners' capital 795,667 743,341
------- -------
Total liabilities and partners'
Capital $1,508,085 $1,301,340
========== ==========
Natural Resource Partners L.P.
Reconciliation of GAAP Financial Measurements
to Non-GAAP Financial Measurements
(In thousands)
Reconciliation of GAAP "Net cash provided by
operating activities" To Non-GAAP "Distributable cash flow"
Three Months For the Six Months
Ended Ended
June 30, June 30,
-------- --------
2009 2008 2009 2008
---- ---- ---- ----
(unaudited) (unaudited)
Net cash provided by
operating activities $57,127 $61,667 $100,679 $100,870
Less scheduled principal
payments (9,350) (9,350) (9,542) (9,543)
Less reserves for future
principal payments (8,059) (4,308) (16,118) (8,616)
Add reserves used for
scheduled principal
payments 9,350 9,350 9,542 9,543
----- ----- ----- -----
Distributable cash flow $49,068 $57,359 $84,561 $92,254
======= ======= ======= =======
Reconciliation of GAAP "Net income attributable to the limited partners"
To Non-GAAP "Adjusted net income attributable to the limited partners"
Three Months For the Six Months
Ended Ended
June 30, June 30,
-------- --------
2009 2008 2009 2008
---- ---- ---- ----
(unaudited) (unaudited)
Non-GAAP
GAAP Net income $17,082 $40,353 $50,502 $74,205
Add write-off of
property due to mine
closure $8,195 - $8,195 -
------ --- ------ ---
Adjusted net income $25,277 $40,353 $58,697 $74,205
======= ======= ======= =======
Adjusted net income
attributable to:
General partner $262 $611 $703 $1,116
==== ==== ==== ======
Holders of incentive
distribution rights: $12,180 $9,822 $23,561 $18,399
======= ====== ======= =======
Limited partners $12,835 $29,920 $34,433 $54,690
======= ======= ======= =======
Adjusted Basic and
diluted net income
per limited partner
unit $0.19 $0.46 $0.52 $0.84
===== ===== ===== =====
Weighted average
number of units
outstanding: 66,946 64,891 65,924 64,891
====== ====== ====== ======
Natural Resource Partners L.P.
Guidance
(dollars and tons in millions except per unit amounts)
Revised Original
2009 Guidance 2009 Guidance
(Range) (Range)
------ ------
Revenues
Coal royalty revenues $176.0 - $195.5 $240.0 - $270.0
Aggregate revenues 5.0 - 7.0 6.5 - 8.5
Override royalties 6.0 - 9.0 10.0 - 13.0
Oil and gas royalties 3.5 - 4.5 4.0 - 5.5
Coal processing fees 7.0 - 9.0 8.5 - 11.0
Coal transportation fees 10.0 - 13.5 13.0 - 16.5
Property taxes 10.0 - 11.0 9.0 - 10.0
Other revenues (1) 3.5 - 4.5 3.0 - 3.5
Total revenues $221.0 - $254.0 $294.0 - $338.0
Expenses
Depreciation, depletion,
and amortization $57.0 - $60.0 $62.0 - $67.0
General and administrative 24.0 - 25.5 21.5 - 23.5
Property, franchise and
other taxes 13.5 - 14.5 13.0 - 15.0
Coal transportation
expenses 0.5 - 1.0 1.5 - 2.0
Coal royalty and override
payments 2.0 - 3.0 1.0 - 1.5
Total operating expenses $97.0 - $104.0 $99.0 - $109.0
Interest expense (net) $37.0 - $40.0 $25.0 - $27.0
Net income $87.0 - $110.0 $170.0 - $202.0
Net income per unit $0.58 - $0.90 $1.67 - $2.12
Principal payments $32.2 - $32.2 $24.7 - $24.7
Distributable cash flow (2) $139.0 - $165.0 $207.3 - $244.3
Average units outstanding for
2009 67.7
(1) Other revenues consist of minimums recognized as revenue, wheelage,
rentals and timber.
(2) Distributable cash flow represents net income plus depletion and
amortization plus minimums of $27 million expected in 2009, minus
principal payments to be paid within the next twelve months
Distributable cash flow is a "non-GAAP financial measure" that is
presented because management believes it is a useful adjunct to net
cash provided by operating activities under GAAP. Distributable cash
flow is a significant liquidity metric that is an indicator of NRP's
ability to generate cash flows at a level that can sustain or support
an increase in quarterly cash distributions paid to its partners.
Distributable cash flow is also the quantitative standard used
throughout the investment community with respect to publicly-traded
partnerships. Distributable cash flow is not a measure of financial
performance under GAAP and should not be considered as an alternative
to cash flows from operating, investing or financing activities. We
believe that "net cash provided by operating activities" would be the
most comparable financial measure to distributable cash. However, due
to the substantial uncertainties associated with forecasting future
changes to operating assets and liabilities, we cannot provide
guidance on forward-looking net cash provided by operating activities
or provide reconciliations of distributable cash flow to that measure.
Guidance continued
Revised Original
2009 Guidance 2009 Guidance
(Range) (Range)
------ ------
Regional Statistics
Coal royalty production (tons)
Northern Appalachia 3.5 - 5.0 4.0 - 6.0
Central Appalachia 26.0 - 30.0 32.5 - 37.5
Southern Appalachia 2.5 - 3.5 3.5 - 4.5
Appalachia 32.0 - 38.5 40.0 - 48.0
Illinois Basin 6.0 - 7.0 7.0 - 8.0
Northern Powder River Basin 3.0 - 4.5 4.0 - 5.0
Total 41.0 - 50.0 51.0 - 61.0
Coal royalty revenues
Northern Appalachia $12.0 - $14.0 $16.0 - $18.5
Central Appalachia 121.0 - 131.0 166.0 - 188.0
Southern Appalachia 16.0 - 19.0 24.0 - 27.0
Appalachia $149.0 - $164.0 $206.0 - $233.5
Illinois Basin 20.0 - 23.0 26.0 - 27.0
Northern Powder River Basin 7.0 - 8.5 8.0 - 9.5
Total $176.0 - $195.5 $240.0 - $270.0
Average coal royalty revenue
per ton
Northern Appalachia $2.80 - $3.43 $3.08 - $4.00
Central Appalachia 4.37 - 4.65 5.01 - 5.11
Southern Appalachia 5.43 - 6.40 6.00 - 6.86
Appalachia $4.26 - $4.66 $4.86 - $5.15
Illinois Basin 3.29 - 3.33 3.38 - 3.71
Northern Powder River Basin 1.89 - 2.33 1.90 - 2.00
Total $3.91 - $4.29 $4.43 - $4.71
Aggregates
Royalty revenues $4.0 - $5.0 $5.5 - $6.5
Aggregate bonus royalty $1.0 - $2.0 $1.0 - $2.0
Production (tons) 3.0 - 3.5 4.5 - 5.0
Average royalty revenue per
ton $1.33 - $1.43 $1.22 - $1.30
SOURCE Natural Resource Partners L.P.
http://www.nrplp.com
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