EOTT ENERGY PARTNERS, L.P. REPORTS THIRD QUARTER RESULTS AND ANNOUNCES FULL COVERAGE OF COMMON DISTRIBUTION
FOR IMMEDIATE RELEASE: Friday, November 12, 1999
HOUSTON - EOTT Energy Partners, L.P. (EOTT) announced today third quarter net income of $550,000, or $0.02 per diluted unit, compared to a loss of $1.8 million, or $0.09 per diluted unit, in the same period in 1998. Results for the quarter just ended reflect a $2.8 million, or $0.12 per diluted unit, noncash reduction in the market value of certain forward energy contracts to manage commodity price exposure. Excluding the noncash reduction, income for the third quarter was $3.3 million, or $0.14 per diluted unit.
“EOTT’s operations produced strong results in the third quarter,” said Michael D. Burke, president and CEO of EOTT. “The steady operating cash flows enabled EOTT to fund the entire common unit distribution for the third quarter using cash available from the partnership and without using distribution support.”
Operating income increased to $8.1 million in the most recent quarter from $1.2 million in the same period last year, primarily the result of EOTT’s growth through acquisitions in the core crude oil business. Crude oil lease volumes from the North America – East of Rockies segment averaged over 400,000 barrels per day in the third quarter of 1999, an increase of nearly 45 percent over the same period in 1998.
“During the recent quarter, EOTT successfully completed debt and equity offerings that raised over $280 million,” said Burke. “With permanent funding in place, our financial flexibility is enhanced and our ability to continue as the leading consolidator in the crude oil gathering and marketing industry is substantially strengthened.”
As part of its crude oil business, EOTT enters into contracts primarily to manage commodity price exposure on agreements for the physical delivery of oil. Certain of these positions are marked-to-market in the current period, while the value of the related physical contract is recognized in the period of delivery. This difference in timing of earnings recognition is the primary reason for the previously referenced noncash reduction in the third quarter.
The cash distribution of $0.475 per common unit for the third quarter of 1999 was declared October 19, 1999 and will be paid November 12, 1999 to common unitholders of record as of October 29, 1999. Distribution support will not be used for the third quarter distribution.
EOTT Energy Partners, L.P. is a major independent marketer of crude oil in the United States and Canada. Together with its predecessors, the Partnership has been serving the petroleum industry since 1946. Both EOTT Energy Partners, L.P. and EOTT Energy Corp., the general partner, are headquartered in Houston, Texas. The common units of EOTT Energy Partners, L.P. trade on the NYSE under the symbol “EOT.”
Please see attached tables for additional financial information.
This press release includes forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although EOTT Energy Partners, L.P. believes that its expectations are based on reasonable assumptions, it can give no assurance that such expectations will be achieved. Important factors that could cause actual results to differ materially from those in the forward looking statements herein include, but are not limited to, demand for various grades of crude oil and the resulting changes in pricing conditions, the success of the Partnership’s risk management activities, conditions of the capital markets and equity markets during the periods covered by the forward looking statements, and the Partnership’s success in integrating recently acquired assets.
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Please see attached tables for additional financial information.
For additional information please contact:
Hardie Davis
(713) 853-6941
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