Magellan Midstream Beats 1Q Earnings - Analyst Blog
03 5월 2013 - 10:40PM
Zacks
Pipeline operator Magellan
Midstream Partners LP (MMP) announced mixed first-quarter
2013 results, with solid contribution from the Refined Products
segment.
The Tulsa, Oklahoma-based oil distributor reported earnings per
unit (EPU) of 51 cents (excluding mark-to-market commodity-related
pricing adjustments), surpassing the Zacks Consensus Estimate of 49
cents and the prior-year quarter profit of 47 cents.
Total revenue of $432.4 million was down 12.4% year over year and
short of the Zacks Consensus Estimate of $530.0 million.
Stock Split
In mid-Oct 2012, Magellan Midstream completed the split of its
limited partner units in the 2:1 ratio. The quarterly results
reflect the effects of the stock split.
Quarterly Distribution
Recently, Magellan Midstream raised its first-quarter 2013 cash
distribution by 2% sequentially and 21% year over year to 50.75
cents per unit ($2.03 per unit annualized). Magellan Midstream’s
new distribution is payable on May 15 to unitholders of record as
on May 8, 2013.
Segmental Performance
Refined Products: In this segment,
quarterly operating profits (before affiliate G&A and D&A
expenses) were a record $160.2 million, up 27.7% year over year.
The 13% increase in transportation volumes and higher gasoline and
distillate shipments mainly contributed to the revenue growth.
Crude Oil: In this segment, operating
margin was $22.7 million, down 5.5% year over year due to higher
operating expenses. This was partially offset by increased crude
oil transportation volumes and rates.
Marine Storage: This segment’s operating
margin fell 9.4% year over year to $25.3 million, due to increased
expenses and a lower utilization level.
Guidance Raised
Management at Magellan Midstream expects to generate distributable
cash flows of approximately $580 million for full-year 2013 and is
targeting an annual distribution growth of 10%. The partnership
plans to achieve an annual payout hike of at least 10% in 2014.
Magellan guided toward second quarter and full-year 2013 earnings
per unit of 52 cents and $2.25, respectively.
Magellan Midstream plans to spend approximately $900 million on
growth projects in 2013, with expenditures of an additional $320
million in 2014 to complete the projects. Moreover, the partnership
is looking to put in more than $500 million in potential growth
projects.
Zacks Rating
Magellan Midstream currently retains a Zacks Rank #2 (Buy),
implying that it is expected to outperform the broader U.S. equity
market over the next 1 to 3 months.
In addition to Magellan Midstream, there are other pipeline
operators that are expected to perform well in the coming 1 to 3
months. These include Copano Energy LLC (CPNO)
with Zacks Rank #1 (Strong Buy), and Energy Transfer
Partners LP (ETP) and Summit Midstream Partners
LP (SMLP) with Zacks Rank #2 (Buy).
ENERGY TRAN PTR (ETP): Free Stock Analysis Report
MAGELLAN MDSTRM (MMP): Free Stock Analysis Report
SUMMIT MIDSTRM (SMLP): Free Stock Analysis Report
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