Forward Looking Statements

Transcription

1 (NYSE:TLP) May 2018

2 Forward Looking Statements All statements contained herein and made by representatives of TransMontaigne Partners L.P. (the Partnership ) during this presentation, other than statements of historical facts, may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of Forward-looking statements address activities, events or developments that the Partnership expects, believes or anticipates will or may occur in the future. These forward-looking statements are based on certain assumptions made by the Partnership based on management s experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Any forward-looking statements contained herein or made by representatives of the Partnership during this presentation are subject to risks and uncertainties, many of which are beyond the Partnership s ability to control or predict. These risks include, among other things, (i) our ability to identify suitable growth projects or acquisitions; (ii) our ability to complete identified projects timely and at expected costs, (iii) competition for acquisition opportunities, (iv) the successful integration and performance of acquired assets or businesses and the risks of operating assets or businesses that are distinct from our historical operations, and (v) the failure of the Partnership s customers or vendors to satisfy or continue contractual obligations. Additional factors that could cause actual results differ materially from management s expectations are detailed in the Partnership s filings with the Securities and Exchange Commission (the SEC ) including those items disclosed in Item 1A. Risk Factors in the Partnership s Annual Report on Form 10-K for the year ended December 31, These filings are available to the public over the internet at the SEC s website ( and at the Partnership s website ( If one or more of risks or uncertainties materialize, or if underlying assumptions prove incorrect, then the Partnership s actual results may differ materially from those implied or expressed by the forward-looking statements. As a result of these risks and uncertainties, investors should not place undue reliance on forward-looking statements. The Partnership undertakes no obligation to update any forward-looking statements, whether as a result of new information or future events. This presentation includes financial measures that are not in accordance with generally accepted accounting principles ( GAAP ). While management believes such measures are useful for investors, they should not be used as a replacement for financial measures that are in accordance with GAAP. Please see the Appendix for reconciliations of those measures to comparable GAAP measures. 2

3 Business Overview 3

4 TLP Business Highlights Attractive business model creates strong value proposition Quality, Diversified Asset Platform Strong Financial Profile Organic Growth Large asset and footprint spanning 6 key regions, 51 1 storage terminals and 3 product pipelines. Asset system represents critical link in refined products distribution chain. Diversified storage capabilities; refined products and other liquids. Recent re-contracting success emphasizes the value of our assets. Long term take-or-pay contracts with quality customers. Highly contracted asset base; ~93% of capacity contracted as of 3/31/2018. Excess coverage provides flexibility. Track record of executing fully contracted growth opportunities with a conservative capital structure. Primary avenues of growth asset maximization and organic projects. Collins Phase II construction of 870 thousand barrels is underway. Executed contracts for the expansion of the Brownsville terminal and our Diamondback pipeline. Strategic sponsor relationship with ArcLight. 1 Owns and operates 49 storage terminals and also owns interests in two additional terminals through the Frontera and BOSTCO Joint Ventures. 4

5 TLP Overview We are a leading terminaling and transportation partnership Own and operate refined petroleum product tank farms and pipelines. Provide integrated terminaling, storage, transportation and related services. Petroleum products, crude oil, chemicals, fertilizers and other liquid products. Longstanding relationships with diversified customers in refined product distribution. Operate in 6 distinct and strategic regions across the US: Southeast, Brownsville (TX), Midwest, West Coast, Gulf Coast and along the Mississippi and Ohio rivers. Partnership Metrics 1 NYSE: TLP EV 2 : $1,196mm Price: $37.84 Market Cap: $614mm Key Stats 38 million barrels capacity 51 storage terminals 3 6 regions $$ $134 million LTM 3/31/2018 EBITDA 4 1 Market data as of 5/11/ EV does not include the GP value. ArcLight acquired the GP from NGL Energy Partners for $350mm in February, Owns and operates 49 storage terminals and also owns interests in two additional terminals through the Frontera and BOSTCO Joint Ventures. 4 Pro-forma for West Coast Terminals acquisition. 5

6 Sizable and Diversified Terminal Network Significant footprint of assets; 51 1 terminals across 6 distinct regions West Coast Midwest River Southeast Terminals: 8 Gulf Coast Terminals: 2 Capacity: 5.0 MMBbl % Contracted: 81% Terminals: 4 Capacity: 1.6 MMBbl % Contracted: 100% Terminals: 12 Capacity: 2.7 MMBbl % Contracted: 54% Terminals: 22 Capacity: 11.9 MMBbl % Contracted: 100% Capacity: 6.9 MMBbl % Contracted: 97% Martinez Richmond Southeast Bostco JV Gulf Coast West Coast Brownsville Frontera JV Midwest Brownsville 2 River Terminals: 1 Capacity: 0.9 MMBbl % Contracted: 89% Frontera JV 2 Terminals: 1 Capacity: 1.5 MMBbl % Contracted: 100% % of Total Capacity % 2.4% 4.0% 4.3% 18.9% 18.3% 13.3% 31.6% Bostco JV 3 Terminals: 1 Capacity: 7.1 MMBbl % Contracted: 100% Denver Monterrey Cushing Oklahoma City Matamoros Mt. Vernon Bostco Investment Brownsville Complex East Liverpool Greater Cincinnati New Albany Evansville Louisville Richmond Montvale Norfolk Cape Giradeau Owensboro Greensboro Selma Henderson Paducah Charlotte Lookout Mtn. Spartanburg Rogers Belton Arkansas City Athens Rome Doraville Greenville Birmingham Griffin Meridian Macon Americus Albany Baton Rouge Dock Collins Bainbridge Pensacola Jacksonville Purvis Frontera Investment Tampa Port Manatee Fairfax Cape Canaveral Ft. Lauderdale Miami Notes: Black dots and dotted lines indicate third party terminals and pipelines. 1 Owns and operates 49 storage terminals and also owns interests in two additional terminals through the Frontera and BOSTCO Joint Ventures. 2 Brownsville complex is comprised of both the Frontera Joint Venture and TLP assets. Capacity includes ~1.5 MMBbl owned by Frontera Joint Venture. 3 Reflects total active storage capacity of Bostco. TLP owns a 42.5% interest. Information as of 3/31/

7 Strategic Advantages Across Regions Quality assets and strategic geographies establish our advantage Southeast Located along the Colonial and Plantation pipeline systems. Most efficient path to Southeast, Mid-Atlantic and Northeast U.S. markets. Collins: only independent terminal capable of storing and redelivering product to, from and between Colonial and Plantation pipelines. Gulf Coast Midwest River Brownsville 1 Bostco JV West Coast Largest terminal network in Florida. Region is without major product supply pipelines and refineries. Fort Lauderdale, Miami and Cape Canaveral ports are among the busiest cruise ship ports in the nation. Products pipeline from Missouri to Arkansas. Terminal locations in Oklahoma, Arkansas and Missouri. Rogers facility: only refined products terminal located in Northwest Arkansas. Largest independent terminal network along the Mississippi and Ohio Rivers. Spans river locations from Ohio through Louisiana. Baton Rouge dock: only direct waterborne connection between Colonial Pipeline and Mississippi River waterborne transportation. Facilitates product movements between the Gulf of Mexico, Northern Mexico and the U.S. Long-term growth opportunities with new and existing customers provided by recent energy deregulation in Mexico. Advantageous location in the Houston Ship Channel. Provides access to expansive refinery complex and export markets. Refineries in this region account for more than 25% of total U.S. refining capacity. Positioned to meet increasing demand for global export capacity. Strategically located within the San Francisco Bay Area Refining Complex. Located in close proximity to three of the San Francisco Bay refineries and the origin of the North California products pipeline distribution system. Bay Area Refining Complex accounts for nearly one-third of total PADD V refining capacity. Note: 1 Comprised of TLP Terminal and Frontera Joint Venture. 7

8 Highly Contracted with Quality Customers 38 mm barrels of capacity; ~93% contracted; Strong counterparties Million barrels 40 Active Shell Capacity 37.6 Top 20 customers represent ~91% of revenue Andeavor U.S. Government All trademarks are the property of their respective owners. 1 Based on revenue for 3 months ended 3/31/

9 Multi-Year Contracts with Firm Commitments Our revenue structure allows for predictable cash flows $mm $60 $50 $40 $30 $20 $10 $0 < 1 Year >= 1 Year, < 3 Years >= 3 Years, < 5 Years >= 5 Years 70% 69% Remaining Duration of Contracts 1 45% 6% 16% ~70% of Revenues from Firm Commitments 74% 68% 70% 69% $11 $11 $10 $13 $12 $13 $11 72% 71% 71% $13 $13 $12 $12 74% 75% 75% 75% $12 $27 $26 $28 $27 $28 $29 $29 $30 $32 $34 $34 $36 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 33% $14 $42 Firm Commitments Variable Commitments % Firm 80% 70% 60% 50% 40% 30% 20% 10% 0% Firmly Committed Revenue Our fee-for-service business model is underpinned by multi-year take-orpay contracts with minimum volume commitments, providing significant stability. Approximately 84% of our current firm commitment contracts are 1-5+ years in remaining duration; with ~51% of contracts at least 3 years in remaining duration. 75% of our revenues are generated from terminaling service fees under multi year take-or-pay minimum volume commitments. The majority of the remaining revenue stems from ancillary services including heating and mixing of stored products, product transfer, pipeline tariffs, railcar handling, butane blending, wharfage and vapor recovery. Note: 1 As of 3/31/2018 9

10 ArcLight Relationship Enhances Company Profile We are backed by a highly experienced and aligned general partner Strategic and Aligned General Partner About ArcLight Capital Partners In February 2016, ArcLight Energy Partners Fund VI indirectly acquired 100% of our general partner from NGL Energy Partners (NGL) for $350 million. TLP s GP holds 2% GP interest and 100% of IDRs. Represented ArcLight s fourth major refined product terminal acquisition in a 10 month time frame. TLP stock price is up ~45% since acquisition announcement. On April 1, 2016, affiliates of ArcLight acquired approximately 3.2 million of our common units (20% interest) from NGL. ArcLight has granted TLP a ROFO on its 51% interest in two terminals in Portland and Seattle which TransMontaigne operates today under a separate agreement with ArcLight. In addition, TLP has a ROFO on ArcLight s 30% ownership interest in the Olympic Pipeline. Leading private equity firm focused on energy infrastructure investments. Based in Boston; founded in Targets midstream, power and production. Significant track record and deep bench of experience owning and operating midstream assets. ArcLight has invested more than $19 billion in over 100 transactions since inception. Experienced and knowledgeable GP - owns and controls over approximately 45 million barrels of complementary refined product storage capacity on the U.S. East Coast and in the Caribbean. 10

11 Growth Projects 11

12 Identified Growth Opportunities Significant inventory of identified growth opportunities 1 Collins storage terminal expansion Phase I expansion added 2 million barrels of capacity. Developing Phase II expansion. Have signed contracts for Collins Phase IIA construction for 870 thousand barrels. 2 Brownsville expansion Signed contracts for the expansion of Brownsville tankage and the recommissioning of our Diamondback pipeline. 3 Enhance various existing assets Opportunity to fill available storage capacity at our terminals. Potential to develop additional butane blending capabilities at various terminal locations. Executing and exploring smaller scale projects at various locations throughout our system, including building tankage and refurbishing tanks at the West Coast Terminals. 12

13 Collins Storage Terminal Expansion Significant demand for additional bulk storage at Collins Phase I: Have placed in service all 2 million barrels of capacity (fully contracted). $75 million capex with return in high teens. Customers include credit worthy parties with 5- year contracts. Phase II: Contracted and in construction. Phase IIA - Constructing 870 thousand barrels (fully contracted) of new capacity for a major oil company. PHASE I PHASE II 13

14 Brownsville Storage and Pipeline Expansion Significant demand for Brownsville with the opening of Mexican oil markets Diamondback Pipeline Expansion: Signed contracts for gasoline and diesel use of both of the Diamondback pipelines, which run from the terminal to the U.S./Mexico boarder. 8 pipeline previously transported propane, 6 has never been used. Pipelines expected to be in service by end of Additional Tankage: Signed contracts for new gasoline and diesel storage. Transportation options out of the terminal include by truck or the Diamondback pipelines. Completed at various stages between the end of 2018 and Tankage may be in Frontera, due to the JV s ROFR. $56 Million in Capex 14

15 WCF Acquisition: Martinez and Richmond Terminals Map of West Coast Facilities Martinez Terminal 36 above ground storage tanks. 4.5 MMBbl of storage capacity. o Includes 2.5 MMBbl of clean product capacity and 2.0 MMBbl of crude oil capacity. o All clean product tanks are multi-product permitted. Connectivity includes: o Deepwater dock capable of handling tankers up to 150,000 deadweight tons (DWT) and 950 in length. o Pipeline connectivity to Bay Area refiners and domestic crude and refined products markets. Products handled include crude oil, gasoline, diesel, jet fuel, gasoline blend stocks and fuel oil. 29 above ground storage tanks. 0.5 MMBbl of storage capacity. Connectivity includes: o Deepwater dock capable of handling tankers and oceangoing barges up to 89,000 DWT and 700 in length. o Truck loading capabilities. o Rail unloading facilities. Products handled include gasoline, diesel, jet fuel, gasoline blend stocks, fuel oil, Avgas, renewable diesel and neat and denatured ethanol. Richmond Terminal 15

16 Financial Summary 16

17 1Q18 TLP Update Achieved record levels of revenue and Consolidated EBITDA Reported 1Q18 revenue of $56.4 million compared to $44.9 million in the prior year (PY) 1Q. Reported 1Q18 Consolidated EBITDA of $32.9 million compared to $27.3 million in the PY 1Q. Continued to maintain a healthy balance sheet Reported 1Q18 distribution coverage of 1.39x and leverage of 4.35x. Increased quarterly distribution from $0.77 to $0.785 tenth consecutive quarterly increase and an 8.3% increase over PY 1Q. $560 million of available capacity on revolving credit facility. Closed acquisition of the West Coast Facilities Total purchase price of $277 million, financed with revolving credit facility. Closed acquisition December 15,

18 Stable Cash Flows and Conservative Balance Sheet A track record of cash flow growth and financial stability Consistent and Growing EBITDA Conservative Leverage Profile 3 $MM $160 $140 $120 $100 $80 $60 $40 $20 $0 $53 $58 $60 $69 $69 $72 $71 $75 $90 $134 $108 $ PF LTM 1Q x 4.0x 3.0x 2.0x 1.0x 0.0x Debt/ LTM EBITDA 4.4x 4.4x 2.5x 2.9x 2.7x 2.6x 3.0x 3.4x 2.8x 3.0x 1.8x 1.7x Q Revolving Credit Facility 2 Outstanding Borrowings $290 $560 Available Capacity As of 3/31/2018, $560 million of unused capacity on revolving credit facility. Credit facility availability enhances balance sheet flexibility. Track record of delivering growth while maintaining conservative leverage. Notes: 1 Pro forma for West Coast Terminals acquisition. 2 Availability subject to covenant compliance under the Revolving Credit Facility as of 3/31/ Figures prior to 2017 not pro forma for West Coast Facilities acquisition. 18

19 13 Years of Distribution Stability and Growth We have a long-term track record of creating and building value $/unit $0.85 $0.80 $0.75 $0.70 $0.65 $0.60 $0.55 $0.50 $0.59 $ % 1 $0.64 $0.665 $0.67 $0.785 Increased quarterly distribution from $0.77 to $0.785 for the quarter ended 3/31/18. Tenth consecutive distribution increase. Annual distribution growth of 8.3% over PY 1 st quarter. $0.45 $0.40 $0.35 $0.43 Long-term history of maintaining and growing cash flows and distribution. $0.30 $0.25 $ % increase in distribution per LP unit since our IPO on May 27, Jun-05 Dec-05 Jun-06 Dec-06 Jun-07 Dec-07 Jun-08 Dec-08 Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 Dec-16 Jun-17 Dec-17 Note: 1 Distribution increase 6/30/05 vs. 3/31/18. IPO May 27,

20 Significant Distribution Coverage Conservative coverage position provides significant cash cushion historical average of 1.4x $25.0 $20.0 $15.0 $10.0 $5.0 $0.0 $mm Actual Distribution vs. Coverage $8.9 $9.4 $6.0 $6.4 $5.9 $5.5 $5.7 $6.0 $5.7 $5.2 $3.0 $4.1 $3.1 $4.1 $4.7 $4.6 $2.2 $12.5 $12.6 $12.6 $12.6 $12.6 $12.6 $12.6 $12.8 $13.1 $13.4 $13.8 $14.1 $14.6 $15.1 $15.6 $16.1 $ x 1.47x 1.43x 1.25x 1.18x 1.32x 1.37x 1.45x 1.46x 1.61x 1.62x 1.34x 1.41x 1.37x 1.39x 1.19x 1.39x 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 Coverage 5.0x 4.5x 4.0x 3.5x 3.0x 2.5x 2.0x 1.5x 1.0x 0.5x 0.0x a b c d Distribution Cushion Coverage Cash Retention a FY14 coverage: 1.31x DCF: $65.7mm Distributions: $50.3mm Cushion: $15.3mm b FY15 coverage: 1.39x DCF: $70.7mm Distributions: $50.7mm Cushion: $20.0mm c FY16 coverage: 1.40x DCF: $75.9mm Distributions: $54.4mm Cushion: $21.5mm d FY17 coverage: 1.45x DCF: $88.7mm Distributions: $61.4mm Cushion: $27.3mm 1 20

21 Appendix 21

22 Current Ownership Structure Public Unitholders Limited Partner Interest 78.8% ArcLight affiliates 100% Limited Partner Interest 14.3% Limited Partner Interest 4.9% Gulf TLP Holdings, LLC (No other assets) 100% TransMontaigne GP L.L.C. (the General Partner) 100% TLP Management Services LLC (Employees) 2% General Partner Interest TransMontaigne Partners L.P. (NYSE:TLP) Operating Subsidiaries Joint Ventures 22

23 Financial Summary (continued) March 31, June 30, September 30, December 31, March 31, Revenue $ 44,850 $ 45,364 $ 45,449 $ 47,609 $ 56,444 Direct operating costs and expenses (16,511) (15,984) (17,719) (17,486) (20,145) General and administrative expenses (3,971) (4,080) (5,247) (6,135) (4,981) Insurance expenses (1,006) (1,002) (999) (1,057) (1,246) Equity-based compensation expense (1,817) (352) (544) (286) (2,017) Depreciation and amortization (8,705) (8,792) (8,882) (9,581) (11,808) Earnings from unconsolidated affiliates 2,560 2,120 1, ,889 Operating income 15,400 17,274 13,942 13,571 19,136 Interest expense (2,152) (2,525) (2,656) (3,140) (6,461) Amortization of deferred issuance costs (294) (271) (320) (336) (501) Net earnings $ 12,954 $ 14,478 $ 10,966 $ 10,095 $ 12,174 Net earnings per limited partner unit basic $ 0.62 $ 0.70 $ 0.47 $ 0.41 $ 0.52 March 31, June 30, September 30, December 31, March 31, Balance Sheet Data Property, plant and equipment $ 419,995 $ 425,875 $ 426,467 $ 655,053 $ 650,037 Investments in unconsolidated affiliates 241, , , , ,030 Goodwill 8,485 8,485 8,485 9,428 9,428 Customer relationships ,136 46,389 Total assets 696, , , , ,618 Long-term debt 292, , , , ,377 Partners equity 373, , , , ,022 $ in thousands, except per unit amounts 23

24 Financial Summary Three months ended March 31, June 30, September 30, December 31, March 31, Net earnings $ 12,954 $ 14,478 $ 10,966 $ 10,095 $ 12,174 Depreciation and amortization 8,705 8,792 8,882 9,581 11,808 Earnings from unconsolidated affiliates (2,560) (2,120) (1,884) (507) (2,889) Distributions from unconsolidated affiliates 4,349 4,546 4,201 4,032 3,190 Equity-based compensation expense 1, ,017 Settlement of tax withholdings on equity-based compensation (382) (25) (304) - (341) Interest expense 2,152 2,525 2,656 3,140 6,461 Amortization of deferred issuance costs Consolidated EBITDA 27,329 28,819 25,381 26,963 32,921 Interest expense (2,152) (2,525) (2,656) (3,140) (6,461) Unrealized loss (gain) on derivative instruments (258) (77) 42 Amortization of deferred issuance costs (294) (271) (320) (336) (501) Amounts due under long-term terminaling services agreements, net (98) (227) Project amortization of deferred revenue under GAAP (51) (104) (332) (278) (187) Project amortization of deferred revenue for DCF Capitalized maintenance (1,462) (1,783) (1,992) (4,698) (3,389) Distributable cash flow, or DCF, generated during the period $ 23,466 $ 24,450 $ 21,635 $ 19,107 $ 23,035 Actual distribution for the period on all common units and the general partner interest including incentive distribution rights $ 14,592 $ 15,077 $ 15,571 $ 16,063 $ 16,571 Distribution coverage ratio 1.61x 1.62x 1.39x 1.19x 1.39x $ in thousands 24