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NuStar GP Holdings, LLC Reports Increase in First Quarter 2013 Distributable Cash Flows

SAN ANTONIO--(BUSINESS WIRE)--Apr. 24, 2013-- NuStar GP Holdings, LLC (NYSE: NSH) today announced that distributable cash flow available to unitholders for the first quarter of 2013 was $22.9 million, or $0.54 per unit, compared to $21.9 million, or $0.52 per unit, for the first quarter of 2012. First quarter 2013 net income was $11.1 million, or $0.26 per unit, compared to $11.0 million, or $0.26 per unit, for the first quarter of 2012.

With respect to the quarterly distribution to unitholders for the first quarter of 2013, NuStar GP Holdings, LLC announced that its board of directors has declared a distribution of $0.545 per unit. The first quarter 2013 distribution will be paid on May 15, 2013, to holders of record as of May 6, 2013.

“NuStar GP Holdings, LLC should benefit from NuStar Energy L.P.’s projections of increased distributable cash flow and EBITDA in 2013,” said Curt Anastasio, President and Chief Executive Officer of NuStar Energy L.P. and NuStar GP Holdings, LLC. “NuStar Energy L.P.’s large internal growth program for 2013, primarily in the Eagle Ford Shale region, should have a positive impact on the future growth of NuStar GP Holdings, LLC’s distributable cash flow and distributions.”

A conference call with management is scheduled for 10:00 a.m. ET (9:00 a.m. CT) today, April 24, 2013, to discuss the financial results for the first quarter of 2013. Investors interested in listening to the presentation may call 800/622-7620, passcode 31554334. International callers may access the presentation by dialing 706/645-0327, passcode 31554334. The company intends to have a playback available following the presentation, which may be accessed by calling 800/585-8367, passcode 31554334. International callers may access the playback by calling 404/537-3406, passcode 31554334. A live broadcast of the conference call will also be available on the company’s Web site at www.nustargpholdings.com.

NuStar GP Holdings, LLC is a publicly traded limited liability company that owns the two percent general partner interest, a 13.0 percent limited partner interest and the incentive distribution rights in NuStar Energy L.P., one of the largest independent liquids terminal and pipeline operators in the nation. NuStar has operations in the United States, Canada, Mexico, the Netherlands, including St. Eustatius in the Caribbean, the United Kingdom and Turkey. For more information, visit NuStar GP Holdings, LLC’s Web site at www.nustargpholdings.com.

This release serves as qualified notice to nominees under Treasury Regulation Sections 1.1446-4(b)(4) and (d). Please note that 100% of NuStar’s distributions to foreign investors are attributable to income that is effectively connected with a United States trade or business. Accordingly, all of NuStar’s distributions to foreign investors are subject to federal income tax withholding at the highest effective tax rate for individuals and corporations, as applicable. Nominees, and not NuStar, are treated as the withholding agents responsible for withholding on the distributions received by them on behalf of foreign investors.

Cautionary Statement Regarding Forward-Looking Statements

This press release includes forward-looking statements regarding future events. All forward-looking statements are based on the company's beliefs as well as assumptions made by and information currently available to the company. These statements reflect the company's current views with respect to future events and are subject to various risks, uncertainties and assumptions. These risks, uncertainties and assumptions are discussed in NuStar Energy L.P. and NuStar GP Holdings, LLC’s 2012 annual reports on Form 10-K and subsequent filings with the Securities and Exchange Commission.

 
NuStar GP Holdings, LLC
Consolidated Financial Information
(Unaudited, Thousands of Dollars, Except Unit and Per Unit Data)
       
Three Months Ended
March 31,
2013 2012
Statement of Income Data:
Equity in earnings of NuStar Energy L.P. $ 12,144 $ 11,772
 
General and administrative expenses (800 ) (857 )
Other income, net 81 136
Interest expense, net   (173 )   (133 )
 
Income before income tax (expense) benefit 11,252 10,918
Income tax (expense) benefit   (177 )   128  
Net income $ 11,075   $ 11,046  
 
Basic and diluted net income per unit $ 0.26   $ 0.26  
 
Equity in Earnings of NuStar Energy L.P.:
General partner interest $ 276 $ 331
General partner incentive distribution   10,805     9,816  
General partner's interest in earnings and incentive
distributions of NuStar Energy L.P. 11,081 10,147
Limited partner interest in earnings of NuStar Energy L.P. 1,784 2,346
Amortization of step-up in basis related to NuStar
Energy L.P.'s assets and liabilities   (721 )   (721 )
Equity in earnings of NuStar Energy L.P. $ 12,144   $ 11,772  
 
 
Distributable Cash Flow (Note 1):
Cash distributions expected from NuStar Energy L.P. associated with:
General partner interest $ 1,961 $ 1,782
General partner incentive distribution 10,805 9,816
Limited partner interest - common units   11,280     11,211  
Total cash distributions expected from NuStar Energy L.P. 24,046 22,809
Deduct expenses of NuStar GP Holdings, LLC:
General and administrative expenses (800 ) (857 )
Income tax (expense) benefit (177 ) 128
Interest expense, net   (173 )   (133 )
Distributable cash flow $ 22,896   $ 21,947  
 
Weighted average number of common units outstanding 42,605,668 42,574,419
 
Distributable cash flow per unit $ 0.54   $ 0.52  
 
Cash distributions to be paid to the unitholders of
NuStar GP Holdings, LLC:
Distribution per unit $ 0.545   $ 0.510  
 
Total distribution $ 23,222   $ 21,720  
 
 
NuStar GP Holdings, LLC
Consolidated Financial Information - Continued
(Unaudited, Thousands of Dollars)
   
Notes:
 
1. NuStar GP Holdings, LLC utilizes distributable cash flow as a financial measure, which is not defined in United States generally accepted accounting principles. Management uses this financial measure because it is a widely accepted financial indicator used by investors to compare general partner performance. In addition, management believes that this measure provides investors an enhanced perspective of the ability to make a minimum quarterly distribution. Distributable cash flow is not intended to represent cash flows for the period, nor is it presented as an alternative to net income. It should not be considered in isolation or as a substitute for a measure of performance prepared in accordance with United States generally accepted accounting principles.
 
The following is a reconciliation of net income to distributable cash flow and net cash provided by operating activities:
 
          Three Months Ended
March 31,
2013     2012
Net Income $ 11,075 $ 11,046
Less equity in earnings of NuStar Energy L.P. (12,144 ) (11,772 )
Plus cash distributions expected from NuStar Energy L.P. 24,046 22,809
Other income, net   (81 )   (136 )
Distributable cash flow 22,896 21,947
Less cash distributions expected from NuStar Energy L.P. (24,046 ) (22,809 )
Plus distributions of equity in earnings of NuStar Energy L.P. 12,144 11,772
Net effect of changes in operating accounts   671     (2,714 )
Net cash provided by operating activities $ 11,665   $ 8,196  

Source: NuStar GP Holdings, LLC

NuStar Energy, L.P., San Antonio
Investors, Chris Russell, Treasurer and Vice President Investor Relations
Investor Relations: 210-918-3507
or
Media, Mary Rose Brown, Executive Vice President,
Corporate Communications: 210-918-2314
Web site: http://www.nustarenergy.com

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