Rose Rock Midstream releases Q2 results

Rose Rock Midstream^®, L.P. has released its financial results for the three months ended 30 June 2014. The company reported Q2 2014 adjusted EBITDA of US$ 20.6 million, compared to US$ 27.8 million for Q1 2014 and US$ 15.4 million for Q2 2013, a decrease of approximately 26% over the previous quarter and up 34% y/y. Crude marketing margins decreased by US$ 1.7 million, resulting from lower marketing volumes following unusually strong first quarter volumes. Rose Rock posted higher operating and G&A expense for the quarter due to higher employment costs, as well as US$ 1.2 million in one-time costs related to acquisitions and financing transactions.

"Rose Rock's second quarter was all about growth. The lower marketing volumes and increased expenses associated with our growth projects were anticipated and was reflected in our updated adjusted EBITDA guidance of between US$ 115 and US$ 120 million," said Carlin Conner, Chief Executive Officer of Rose Rock Midstream's General Partner. "We grew our business through the acquisitions of the crude oil trucking assets from Chesapeake Energy and of the remaining one-third interest in SemCrude Pipeline, which owns 51% of White Cliffs Pipeline, from SemGroup. These actions support our ability to raise our cash distribution per unit to US$ 0.535, which marks our tenth consecutive quarterly increase since our IPO."

Adjusted gross margin totalled US$ 33.8 million in Q2 2014, a decrease of 9% from Q1 2014 (US$ 37 million) and a 68% increase compared to the Q2 2013 adjusted gross margin of US$ 20.1 million. Q2 2014 net income totalled US$ 15.1 million, compared to US$ 16.2 million for Q1 2014 and US$ 9.1 million for Q2 2013.

Rose Rock Midstream's distributable cash flow for the three months ended 30 June 2014 was US$ 16.8 million. On 24 July 2014, Rose Rock Midstream increased the partnership's quarterly cash distribution to US$ 0.535 per unit from US$ 0.495 per unit, effective for Q2 2014, resulting in an annualised distribution of US$ 2.14 per unit. This is an 8% increase over Q1 2014 and up 48% since the initial public offering in December 2011.

Adapted from press release by Rosalie Starling

Read the article online at: https://www.worldpipelines.com/business-news/18082014/rose-rock-midstream-releases-q2-results-731/