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In this case I bet there will be opportunity to trade against the panic since we watch the market over-react all the time. A different group think will emerge as folks realize that half as much yield is still better than most investments. As long as the quarter goes by without any down time, there will be good if not great distributions, imo. Remember NTI has other advantages over most refiners that could be enhanced by the reboot of the shale boom. Quarters after a turnaround could become the time to buy after we prepare ahead with dry powder, again after market reacts negatively to the variable payout.
I think a law change will trigger M&A in this tiny sector. I still believe MLP's give the best and safest returns, free from the C corp model of theft from the investor by meains of board cronyism and nepotism. GLTA!
Seeing and knowing what you do, how will this have you implementing changes between now and whenever? I'm referring to portfolio holdings, allocations and reliance upon same for personal income reasons?
The big question for me:
Will I have sufficient warning to jump off my horse when the earth beneath shows a gaping hole capable of swallowing us both without hesitation?
And how devastating might this refinery moment be?
I'm trying to gain more traction while there's still time to reorganize my brain. When the Canadian oil and gas royalty trusts went bust, I'd begun moving funds into other areas early enough to stem potential losses that could have crippled me. Defensive posturing is always smart management.....it's not like we can't reconfigure allocation as market gyrations spell opportunity.
Your thoughts are most appreciated. And Cat's, too. And all others!
Thanks, all.
It can't be too much longer for us, less than a year I suspect. That said we hold the top independents in the USA and they won't cease to perform well against their peers, just how well is the question. Lack of Infrastructure in ND, proximity, flexibility and vertical integration of NTI will help them going forward as the lifting of the ban and rise in crude to world favorable levels will kickstart the shale revolution here too. Almost 100% predict oil will rise in less than 2 years without any law change. I don't know if that is wishful thinking on some traders part or is fact. Supply and demand without curbing production tell me it won't go back for a longer time. Russia and China can frac a lot of oil too, not to mention old oil from Iran. The world has much more fossil fuel than it thought and alternatives are few and expensive at this moment in time.
Back to the crude export ban, many think it will be lifted soon. If not soon it may not happen until after the next election, but it probably will happen because congress can't help itself, but big oil can. They must meddle! I see the independents being swallowed up by the big boys at that point. Just like when they forced independent gasoline retailers out of the business 30 years ago.
I hope so---you're fun to have around.
Good luck all - "I'll be back"
Today's "refiningreport" was fairly bearish - so I sold.
I pay attention to reports that just "give the facts" and the facts in this report were slightly negative.
But, I continue to pay attention to NTI.
Yes, I also think we all should have played ALDW. I did pick up 700 units but then sold at about $19, missing a full half of the run up.
I rebuilt and sold a little later and did well but now am holding just 200u and wanting to rebuild. Not having any luck price-wise.
What is your take on the proposed legislative changes re. oil exportation?
How much and especially---how soon do you believe the looming (and blooming (lol) threats are for us longs?
Reports come out that affect a stock pick. Some predict doom & gloom while other see the rosy future and nothing else.
I avoid taking any of them to heart, figuring that when I have to ask other when it's OK to laugh at a comic's one-liners, I'm no longer foraging for myself. These folks are often well-intentioned enough but one never knows the true character lying within. Or espousing "lies" from within...and, perhaps, without conscience.
It's gratifying to read of those in agreement with our assessments but my own vote means more to me than that of pundits. After all, I'm responsible for investing my dollars.
A far greater concern for me is the stuff of the JPM comments.
With nearly 6,000 units of NTI I could be painfully scorched.
Well said jugs and I agree with all of your post - our only real risk here is some kind of malfunction at the refinery - I am much too busy to baby sit and I never worry about my holdings here - I love this stock.
Go Rangers !
What say you to the possibility of the exportation of oil becoming a reality? This will put refiners in an awful bind and that means we stand to lose our milk supply from several cash cows.
One can only wonder what caveats will accompany such legislation?
JPM did a hatchet job on NTI, and we can deduce the motive. Obviously they are in the game for entirely different reasons. nuff said.
I will buy even more if it goes below 24. My last buy was 24.12
The day fear took the market down 1k in early morning trading I shoulda bought more aldw at 13 something. I saw it there but I was on very slow foreign connection. We all shoulda played that one back to normal, no?
Alright -- Missed that 24.13; bought at 24.31.
Hope the refining report is only slightly negative.
Been buying. Just added at $24.13 maybe a half hour ago. There's no doubt in my mind---we're being played. I'm trusting my instincts on this and going along with the imbalances evident in the three MLPs. I can see no earthly reason for NTI to swoon while the others rise without merit.
When NTI rises, I'll sell some to finance CVRR or ALDW. This approach has been effective as it guarantees that the lowest prices become targets for acquiring.
So far this week there's been ample opportunity to add NTI on the very cheap. Now, all we need is for NTI to climb $2 so I can work at the other two. Can you arrange that? lol
Buy low, sell higher - I want to hit the buy button, but will wait to read Howard Weil's "refining report," which comes out tomorrow.
I do appreciate the refinery's location - far away from imported gasoline offload sites.
Lots of gasoline is being imported, and there's a good chance that the volume will increase.
Today's trading action is exactly what the doctor ordered. Been adding NTI at $24.56 and below. This is about a dollar and a quarter beneath my last week's sales which, as it happens, were not even near my projected highs for this stock. However, sell about a thousand units last week for a gain of $1.25 or so and then duplicate from the other direction as being done right now and there's very good money to be made here. In the space of a few trading days and duplicated severally and the opportunity becomes quite visible. And somewhat predictable!
There are a few things some might view as being fairly stable:
1.There is good reason to expect we'll soon see $25.70. I'll sell, some there unless momentum is great, implying higher numbers.
2. Unit prices may drop below $24.50. I'm buying in 200-to-300 unit quantities to maximize opportunity for best average prices.
3. With volatility such as we're seeing, it behooves the trader to remain glued to an Internet device to take advantage of swings.
4. I'd stake my life on NTI's blowing well past $26 within a month. A fire or explosion would hurt, obviously.
Add it up and there's a really fine potential here. I'm buying.
You have this issue well pegged and will continue to profit.
In my case the long term cost basis has gotten so low I look to other investments that have the long term gains recently taxed and paid for making those issues dry powder any time I want cash to live on or invest.
I am cautious to avoid greed in this one too. I am at my comfortable share amount and percentage here.
There will come a time when the windfall from US Crude export ban goes away and spreads in turn fall to make refiners a much less attractive investment... even these MLP ones we have singled out. GLTA!
Yes... Your logic is impeccable!
I concluded that this company was being played by big money people, toying with us littler folks
I think you've done things smartly. And given that we've had a few up days this week following devastating ones in the other direction, I'm thinking we're ripe for a rebalancing of sorts...with things moving downwards...possibly as early as tomorrow. I hope I'm wrong.
Nothing is ever going to stay the same when it comes to market predictability. We all know that. I wish everyone understood WHY you sold! There's money to be made in all market conditions but only if we're willing to let go enough to take profits. Today, for example, I sold 1200 units of NTI at an average of about $25.70. On a non-adjusted cost basis I received about $2/unit on the capital appreciation side. I fully expect to reclaim these sold units but at something in the $24 range. I think it's a safe bet that we'll see a few dips over the next six weeks or so, probably sooner. Even today is showing a drop of about 30 cents from my sell point. I'm not feeling threatened at this point in time.
The math is simple: Buy a thousand units at $25.17 (the low of the day)and cash out in the morning at $25.40 or slightly below today's close---and you've made $230. There's plenty of volatility and that spells opportunity for profits. Do this a couple of times weekly and it's pretty easy living.
Of course it requires a grubstake and there's an element of risk. But there's also increased opportunity for good things.
Probably a good move.
After watching the cs deteriorate for a week or so, I cashed out at 25.95, 10 days ago. Though the cs is still very nice, it is slowly falling, as is the bakken/wti differential.
If things stabilize where they are, q3 looks at least as good as q2 ($1.08). Should have repurchased last Friday, but I screwed up my buy order. Now I'll wait a bit.
Just sold a few hundred NTI at $25.62.
Did similarly with ALDW.
This is seemingly a volatile market, at least on the surface. But traders are invariably on the lookout for "measurable volatility." By that, I mean we look for some degree of predictability. This is what suggests to us that today's high will likely drop back tomorrow. By the same token, today's steep decline may indicate an increased likelihood of a recovery on the morrow.
NTI appeared to be having convulsions lately, something not making any sense to me at all. I concluded that this company was being played by big money people, toying with us littler folks.
Seeing today's interesting rise following the drop-off of late tells me this back and forth battle ain't done yet. And that means there's money to be made in these swings.
A low cost basis well under $24/unit means there's an easy $600 to be grabbed on just 300 units. Juicier still is that these significant drops are usually followed by sudden returns to higher valuations. And then there's the fact that we are still a long ways off from the usual Q3 guidance and distribution.
This is easy money. I don't see any risk at all. And money in hand beats every other possibility anywhere.
This is not investment advice. Believe me when I say I've been caught in traps of logic more times than I like to consider. But then don't we all know that 4+4= 10? Looka here---2+2= 5, so the logic is impeccable, isn't it?
Show me the money !!! yes I am surprised gas is still above 2 bucks
I hear oil was 36bbl in Mexico yesterday but did not confirm it.
Gas has not followed it down this time around. The refiners must be raking in big profits with the spread on both the supply and the retail side of things in their favor. Still 3+ million barrels more supply than demand each day around the globe and with peak demand/driving season ending here, retail should fall again. Friday is payday here too... :)
It's so nice to be making money while almost every oil stock is taking a beat down - low oil for at least another 18 months imo
up we go -should see a market bounce today as fools realize there is no reason for the drastic market drop - not even China is a real reason - we are joined at the hip with them on debt but our economy did not tank over night - it will go back up - no fear
My hunch for NTI:
$28 minimum by the end of September.
$29 is a strong likelihood in October.
Down the homestretch leading up to Q3 guidance defining the distribution, we may see $31-$34. I realize it sounds like pie in the sky but it isn't out of the ream of real possibility.
Even "The Street" is seeing the merits here, with a total reversal of its former stance moving from "sell" to "buy."
Things are lined up neatly for us longs.
Like I said, that 9,000 unit position was sheer stupidity on my part. I was in the thrill of riding risk. I've settled down some since then and now court about 5,500 units, more than enough. However, how much you wanna bet I'll add a few more on any dips back to the $25 range? Of course I will. lol It's great fun.
Foolishness isn't a disease, it is a "condition." And, boy!---have I got a condition! lolol
We cast our lots every day we live above ground. Nothing is engraved in stone save for the final epitaph announcing our final resting place. I figure now is the time to enjoy the ride and if it means we have to take chances, then so be it.
NTI has been a whirlwind of excitement and profits. I see no reason to deviate from the program in place for I expect the status quo will continue to enrich those of us holding units. And if $30 is to return, then there is really virtually no risk whatsoever unless the investor is afraid of making a lot of money.
I'm so afraid! Scared out of my Texas skin. Bring on the profits!!! We'll find a way to accept stunning success and if any folks here can't manage that, I'll help---with open arms.
no I did not get the first dividend but all the rest -I think we are on another ride to the big 30 weeeeeeeeeeeeeeee!!!
9K units woa mule lol -
Dang! I'm having a hard time getting into my home-based office, the place stinks of dead fish! It's obviously your doing.
Fishing is a great meditative art. The last time I fished I caught a 203 pound lunkhead.
OK, go for it---what the heck is a lunkhead?
It's me. lol I was fishing the Intercoastal waterway and got my lure caught in a tree behind me. I got aggressive, figuring I wouldn't unsnare it when all of a sudden, it flew out of the tree and the Ghost of Fishing cast for me. I was so thrilled I trolled in a way only a troll would or could troll---and got the hook caught in my sweatpants. As luck would have it, while I didn't catch anything meaningful, I have a neat fish tale to tell. And the hook never broke skin on my knee.
It is great fun being here and sharing with you guys as I often bring to light. We fellow NTI-ers are a success story for sure.
I agree that we are probably in store for more than a dollar come the Q3 distribution. A weak quarter wouldn't sink my enthusiasm as we've done so well already. And things are obviously in place for continuing good fortune, I believe.
Today we actually neatly exceeded the $26.53 point defining the stock valuation on ex-dividend morning...by more than a dollar. While I dare not suggest we'll hold all or most of the gain, I do sense that we are in an uptrend.
It looks like I got into NTI just a tad before you as I received the first distribution. Did you get it too?
At the time I was holding more than 9,000 units. I was obviously out of my mind despite the fact that I was coining money. However, I was entrusting NTI with more than half of my investable cash, something I wouldn't dream of even considering nowadays. I can't explain my ignorance at that point in time. Crazy!!!
Keith Schaefer did point the way towards NTI back then although I hadn't encountered him up to that point. I don't know what brought me to NTI but I think it started with my fascination with oil and gas royalty trusts in Canada. Back then, I'd use "Marketwatch" to help locate like companies for the sake of comparisons. I have a hunch NTI came up as a like company as I was heavily committed to the Canadian trusts and also BPT, a well known domestic pick which, at that time, was barred from "growing the business." Instead, each domestic trust was required to post the anticipated termination point wherein the trust would likely cease to operate. Drilling new wells was strictly prohibited. Things have changed!
As pointed out on this board, Keith did, in fact, recognize the massive opportunity NTI presented. Researching his recent touts, it becomes apparent that NTI is not the one he's envisioning doing spectacularly well in short order. He makes that clear by indicating the latest blockbuster is a stock new to his faithful readers. I sure wish we knew what the pick is!!!
Yep, it's good to have you aboard... All is well in the North.
As a newbie mod then I sought your help here back in Early 2012. this is the first and only board I moderate. Not that there is much to do here but sit and collect... We have a very civil, respectful group of followers who will sometimes add to the discussion. And don't forget resident cheerleader jugs... good to have him and his IR background. Many others lurk (and smile to themselves).
I still believe this one will keep gaining attention and mature to $30+. Holding up nice after ex date.
Naysayers aside, ya gotta love the variable yield going from good to great, sustainable or not. Irrelevant at this point because we have a lot of that seed capital back in the 2+ years here. Seems current quarter will also produce $1+ :)
Each has his/her own method, accumulating or flipping.
Here is MY flipper entitled "dinner"!
GLTA!
I did not realize that I have been with NTI since Jan. of 2013 wow time flies. This has been a worry free position and that's hard to find in today's market madness, Congrats to all here.
Keep smiling, be happy -
Big refineries down in PADD 2; the Enbridge pipelines that carry WCS from Ill to Cushing are down; and the price of 27% of NTI's feed stock (WCS) has crashed ($25 WTC/WCS differential), SPPark refinery is running full out -
everything looks green for NTI right now.
wow there you go 26.82 have a great weekend
Lovely. Just lovely.
I still say, ALDW and CVRR are no match for the likes of NTI but the important thing is that at least some of us see it, know it, and are able to rejoice in the fact that this is one fine company.
So, Miss NTI---wanna get married?
OK, now....Miss NTI---if I tell you I love you, will you close above $26.53 today? It would mean soooo very much to us here! Our cousins, CVRR and ALDW both gained ground following their going ex-distribution and while they're bouncing around a bit, they are both on fairly solid ground...high enough for now.
So please, sweetheart---do the right thing for we have long been devoted to you.
Show us some love---NTI love!!!
yes although tempted I want to see what unfolds the next few weeks - we could be making a run to 30 again, if so we all know what to do -lol
You're right, thank you for clarifying. For some reason I was thinking Friday is the 13th.
Horrors!
So today is the last opportunity to sell prior to going ex on the morrow. Both ALDW and CVRR are holding their own and/or rising despite having gone ex previously. That has me wondering if NTI won't follow suit as well...i.e.--- holding the elevated valuation?
Any thoughts on this, folks?
I think NTI goes ex tomorrow the 13th:
NTI Upcoming Dividend Payouts
Next Ex-Dividend Date
Aug 13
Date
$1.19
Amount
http://www.dividend.com/dividend-stocks/basic-materials/oil-and-gas-refining-and-marketing/nti-northern-tier-energy-lp/
C'mon, $28!
It could happen, given that we aren't even a third of the way thru today's trading. And then there's always tomorrow as it goes ex on Friday.
So few of us recognize the opportunity here, such a shame.
That said, I'm hesitant to sell any units this time as I see the possibility of units retaining their elevated valuation. I may just hold the CVRR liquidation $$ & NTI distribution the end of the month and parlay both sums into more NTI when and IF it should drop significantly. The next eight weeks should spell things out clearly.
For now, though, we are sitting pretty!
27 in the house - I have been very busy and every time I check in on NTI- I smile
Well done Jugs- it is one of the best plays on the market imo holds its value and great yields - I am really surprised more traders have not got into the nice 1-2 dollar swings - heck maybe they are, I don't know anything lol but I am happy
Frankly (no, not the hotdog variety), I'm extremely pleased. In a couple of weeks I'll collect $4,047 in a general account and $6,338 across that and a couple of IRAs. That is one heck of a fine payday!
I'm always here. LOL
I have the board marked and read every post.
I just tend to keep quiet and lurk in the shadows.
Hope all is well with you and the family! :)
Hi eastunder good to see you - this one does do her job very happy with NTI
Those of us who discovered and bought NTI that first six months it was public back in 2012 have been paid a big chunk of our investment back, if we held long term, or made money selling higher along the way, then buying low and repeating when it inevitably swings again, like some here have.
For me it's always been the yield... Who doesn't love MLP's "return of capital"?
Bought 9 pieces over time and averaged up and down. $24.33 cost average now but a return of capital basis after payback is $16.56 after the current payout. So I am up about 3k in value but also paid $24k in distributions in 2 years plus one quarter. Adding another $3927 tax deferred on August 28th. ...thanks NTI!
The patient will be rewarded with this company even now as they appear to be great operators of their business. The retail stores are jam packed with fast moving C-styore inventory, look new, clean, and also appear well managed. As someone here pointed out... it's more than just the profit from retail that rounds this one out. It's the dedicated fuel supplied from the cash cow refinery we own! Add to that 90 Marathon station outlets that get their fuel from NTI. The spreads are great for the current quarter too! GLTA!
NTI
I think it depends on what you are looking for. A trade for the dividend isn't the move normally because on X you see an adjustment and then need to hold it to get the pps back to the price you paid, plus then you have the gain from the div you received but LT, NTI is a good vehicle for dividends even with the fluctuations in pps.
I have owned it for some time (2013 @ 26.74) and currently show a 2900 loss on pps but I have had 10,540.00 in Dividend income. So she does her job.
Thank You,I hope this pps,can stay stable,otherwise its not worth it.
No, it's not.
Effective August 4, 2015, the Board of Directors (the "Board") of Northern Tier Energy GP LLC, the general partner of the Company declared a quarterly distribution of $1.19 per unit that will be paid in cash on August 28, 2015 to common unit holders of record as of the close of business on August 17, 2015. Cash available for distribution totaled $111.3 million for second quarter 2015, including the $25.0 million reduction in working capital reserves.
So that puts the X date 4 days before that, right?
X should be on the 11th or there about. (weekend excluded)
The official X date will show up here and you need to buy before that date
http://www.dividendinvestor.com/historical.php?no=489707
is it to late to get in on this for this recent quarter?
Love it! Love it! Love it!
On Thursday of last week I posted:
I'm expecting $1.10 with a possibility of as much as $1.35. I'll be happy with $1 but I'll giggle at anything above the dollar + teens.
Well, forgive me for falling short of giggling by a penny (brag, brag! lol) but I think I deserve at least a chuckle and a half, right?
Frankly (no, not the hotdog variety), I'm extremely pleased. In a couple of weeks I'll collect $4,047 in a general account and $6,338 across that and a couple of IRAs. That is one heck of a fine payday!
This is one rare stock in several ways but it is one way in particular that gets my attention:
The Company never seems to embark on a course of action unit holders find unacceptable. Conservative?---possibly a well earned moniker. Yet were that not the case, one can only wonder if the distribution would be a dollar, let alone more.
Awhile back, folks viewed the adding of new stores as pointless as there didn't seem to be any profit to be made. However, anybody who has ever been in business for himself will know that the securing of opportunities to push your product out the door is the linchpin when it comes to success in sales. More franchises means more such opportunity. Who cares if the stores don't sell a lot of lollypops and snacks when we get to sell the product our refinery produces?
So I'm delighted, for sure. And I may add a few units now at just under $24.95 or---$23.76 post-distribution just two weeks away.
And I'll bet you units are going to hold most of their current value several weeks out from the scheduled payout. We have every reason to expect a duplicate payout for Q3!
This is a no-brainer for me.
Happy profits, everybody!
I am very happy with 1.19 - NTI is solid play -one of the best imo
Northern Tier Reports Second Quarter 2015 Results
Tue August 4, 2015 6:00 AM|GlobeNewswire | About: NTI
Highlights:
Declares second quarter distribution of $1.19 per common unit to be paid in cash on August 28, 2015
Second quarter Adjusted Net Income of $90.7 million and Adjusted EBITDA of $116.7 million
Record quarterly throughput at the St. Paul Park refinery
Solid gasoline margins
TEMPE, Ariz., Aug. 4, 2015 (GLOBE NEWSWIRE) -- Northern Tier Energy LP and its subsidiaries (NYSE:NTI) (collectively, "Northern Tier" or the "Company") today reported second quarter 2015 Net Income of $128.9 million, compared to $57.9 million for second quarter 2014. Results for the 2015 quarter included a $38.2 million non-cash lower of cost or market ("LCM") inventory adjustment benefit. Adjusted Net Income, which excludes the LCM adjustment and other special items, was $90.7 million for second quarter 2015, compared to $61.4 million for the prior year quarter. Adjusted EBITDA for second quarter 2015 was $116.7 million (excluding the LCM adjustment) compared to $82.1 million for second quarter 2014, primarily due to higher gross margins per barrel, along with higher throughput. A reconciliation of reported earnings to various non-GAAP performance measures can be found in the accompanying tables.
Dave Lamp, Northern Tier's Chief Executive Officer, said, "In the second quarter of 2015 our St. Paul Park refinery achieved record-setting quarterly throughput of approximately 99,000 barrels per day. Product margins were strong, led by robust gasoline crack spreads. In retail, we saw an increase in fuel volumes, fuel margins and merchandise sales. With these solid results, I am pleased to announce a second quarter distribution of $1.19 per unit."
Mr. Lamp continued, "We made good progress with our organic growth initiatives during the quarter, including equipment procurement and continued construction on the crude unit desalter and #2 crude unit revamp projects. In retail, our general partner's Board of Directors recently approved the building of two additional stores, for a total of five approved in 2015, one of which is currently under construction. We added four franchise locations during the second quarter, for a total of ten new franchise locations this year."
Second Quarter Operating Segment Highlights
Refining Segment
Refining operating income excluding the LCM adjustment was $103.3 million for second quarter 2015 compared to $72.8 million for the prior year period. Refining gross margin was $17.85 per barrel of throughput for second quarter 2015 ($21.98 per barrel including the LCM adjustment) compared to $15.03 per barrel of throughput for second quarter 2014. Refining Adjusted EBITDA for second quarter 2015 was $114.7 million (excluding the LCM adjustment) compared to $82.7 million for the prior year period. This increase was driven by improved gross margins along with increased throughput and sales volumes. Total throughput was a quarterly record of 98,954 barrels per day for second quarter 2015 compared to 93,022 barrels per day for the prior year period. Throughput for the prior year period was impacted by planned maintenance on the Minnesota Pipeline.
Retail Segment
Retail operating income for second quarter 2015, was $4.6 million (excluding the LCM adjustment), compared to $5.0 million for second quarter 2014. Fuel margins were $0.22 per gallon for second quarter 2015 compared to $0.19 per gallon for the prior year period. Adjusted EBITDA for the second quarter 2015 was $6.6 million (excluding the LCM adjustment) compared to $6.7 million in the second quarter 2014.
The aggregate of fuel gallons sold at company-operated retail stores plus fuel gallons sold to franchise stores increased 10.9% for the quarter ended June 30, 2015 compared to second quarter 2014 and 18.5% compared to second quarter 2013. This growth was primarily the result of adding 18 SuperAmerica franchise locations. The number of franchise locations totaled 99 as of June 30, 2015, compared to 81 as of June 30, 2014.
Liquidity and Capital Spending
Northern Tier's primary sources of liquidity are cash generated from operating activities and its ABL Facility ("ABL"). As of June 30, 2015, Northern Tier's cash on hand and availability under the ABL amounted to approximately $381 million as compared to approximately $313 million as of March 31, 2015. Working capital requirements can have a significant impact on the Company's liquidity. During periods of declining crude oil prices, cash from operations is negatively impacted by the timing of crude oil payables versus current product pricing. The reverse is true during periods of rising crude oil prices. During the fourth quarter of 2014, when crude oil prices dropped dramatically, the Board of Directors of Northern Tier's general partner reserved $55.2 million to reflect the negative impact on cash earnings for that period and to manage working capital requirements. During the second quarter 2015, crude oil prices increased, resulting in an estimated $25 million benefit to the Company's cash earnings from operations for the period. As a result, the Board reduced the working capital reserve established in the fourth quarter 2014 by $25.0 million, which increased cash available for distribution for the second quarter 2015 correspondingly. While the Company considers its current level of liquidity to be ample to support its continuing operations, the Board anticipates making additional changes, both increases and decreases, to the Company's cash reserves in the future, as it deems appropriate to address this impact of changes in crude oil prices on our working capital requirements.
Capital spending for second quarter 2015 was $11.1 million, including $4.9 million on organic growth projects, compared to second quarter 2014 spending of $15.1 million.
Quarterly Distribution
Effective August 4, 2015, the Board of Directors (the "Board") of Northern Tier Energy GP LLC, the general partner of the Company declared a quarterly distribution of $1.19 per unit that will be paid in cash on August 28, 2015 to common unit holders of record as of the close of business on August 17, 2015. Cash available for distribution totaled $111.3 million for second quarter 2015, including the $25.0 million reduction in working capital reserves.
Northern Tier Energy LP is a variable distribution master limited partnership. As a result, its quarterly distributions, if any, will vary from quarter-to-quarter as a result of variations in, among other factors, (i) operating performance, (ii) cash flows caused by, among other things, fluctuations in the prices of crude oil and other feedstocks and the prices received for finished products, (iii) working capital requirements including inventory fluctuations, (iv) maintenance and regulatory capital expenditures, (v) organic growth capital expenditures less any amounts we may choose to fund with borrowings from our ABL Facility or by issuance of debt or equity securities and (vi) cash reserves deemed necessary or appropriate by the Board of Directors of our general partner.
Q3 2015 Operating and Capital Expenditure Guidance
For the third quarter of 2015, Northern Tier projects total throughput of between 96,000 and 99,500 barrels per day at the St. Paul Park refinery. Direct operating expense per barrel of throughput is expected to be between $4.55 and $5.05, not including turnaround expenditures. Total capital expenditures for the third quarter and full year 2015 are expected to be approximately $24 million and approximately $70 million, respectively. The full year 2015 capital expenditure guidance includes approximately $34 million for organic growth projects. See the accompanying table for additional key metric guidance.
Conference Call Information
Northern Tier will host a conference call to discuss its quarterly results on Tuesday, August 4, 2015, at 11:30 am Eastern Time. Callers may listen to the live presentation, which will be followed by a question and answer segment, by dialing (877) 474-9503 or (857) 244-7556 and the passcode 56201148. An audio webcast of the call, as well as a slide presentation, will be available on the Investor section of www.northerntier.com under Calendar of Events. An audio replay of the conference call will be available for fourteen days following the call on www.northerntier.com and for seven days following the call by dialing (888) 286-8010 or (617) 801-6888 and the passcode 38027282.
About Northern Tier
Northern Tier Energy LP (NYSE:NTI) is an independent downstream energy company with refining, retail and logistics operations that serves the PADD II region of the United States. Northern Tier operates a 97,800 barrels per stream day refinery located in St. Paul Park, Minnesota. Northern Tier also operates approximately 165 convenience stores and supports approximately 99 franchised convenience stores, primarily in Minnesota and Wisconsin, under the SuperAmerica trademark, and owns a bakery and commissary under the SuperMom's brand. Northern Tier is headquartered in Tempe, Arizona.
More information about Northern Tier is available at www.northerntier.com.
Non-GAAP Measures
This earnings release includes non-GAAP measures including Adjusted Net Income, Adjusted EBITDA, Cash Available for Distribution, Refining Gross Margin, Retail Fuel and Retail Merchandise Gross Margins, and other measures that exclude the impact of non-cash and special items. Northern Tier believes that these non-GAAP financial measures provide useful information about its operating performance. However, these measures have important limitations as analytical tools and should not be viewed in isolation or considered as alternatives to comparable GAAP financial measures. Northern Tier's non-GAAP financial measures may also differ from similarly named measures used by other companies. See the accompanying tables and footnotes in this release for additional information on the non-GAAP measures used in this release and reconciliations to the most directly comparable GAAP measures.
Forward-Looking Statements and Qualified Notice
This press release contains certain "forward-looking statements" which reflect Northern Tier's views and assumptions on the date of this press release regarding future events. These forward-looking statements include statements about, among other things, future: payment of distributions including the amount and timing thereof; organic growth initiatives including the crude unit desalter and #2 crude unit revamp projects and the progress thereof; construction of new retail stores; franchise growth; liquidity including cash and ABL availability; working capital requirements and reserves relating thereto; crude oil prices; cash reserves including increases and/or decreases thereof; operating and capital expenses; calculations of cash available for distribution; margins and our ability to capture such margins; total or other throughput; crude oil charge and inventories; direct operating expenses; turnaround expenses; retail and franchise volumes, sales and margins; SG&A, depreciation and amortization; interest expense; tax expense and amounts and types of capital expenditures on maintenance, regulatory and organic growth projects or otherwise. They involve known and unknown risks, uncertainties and other factors, many of which may be beyond its control, that may cause actual results to differ materially from any future results, performance or achievements expressed or implied by the forward-looking statements. All forward-looking statements speak only as of the date hereof. Northern Tier undertakes no obligation to update or revise publicly any such forward-looking statements. Northern Tier cautions you not to place undue reliance on these forward-looking statements. Please refer to Northern Tier's filings with the SEC (SCUR) for more detailed information regarding these risks, uncertainties and assumptions.
This release serves as a qualified notice to nominees and brokers as provided for under Treasury Regulation Section 1.1446-4(b). Please note that 100 percent of Northern Tier's distributions to foreign investors are attributable to income that is effectively connected with a United States trade or business. Accordingly, Northern Tier's distributions to foreign investors are subject to federal income tax withholding at the highest effective tax rate.
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Northern Tier Energy is an independent downstream energy company with refining, retail, and pipeline operations that serve the PADD II region of the United States.
Refining BusinessNorthern Tier’s refining business primarily consists of an 89,500 barrels per calendar day (96,500 barrels per stream day) refinery located in St. Paul Park, Minnesota.. The refinery’s complexity allows it to process a variety of light, heavy, sweet and sour crudes into higher value refined products.
The St. Paul Park Refinery is one of only two refineries in Minnesota and one of four refineries in the Upper Great Plains area within the PADD II region. The PADD II region covers Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Nebraska, North Dakota, South Dakota, Ohio, Oklahoma, Tennessee and Wisconsin. The refinery’s strategic location allows it direct access, primarily via the Minnesota Pipeline, to what the Company believes are abundant supplies of advantageously priced crude oils. Many of these crude oils have historically priced at a discount to NYMEX WTI.
The Company will seek to benefit from access to growing crude oil supplies. As of [June 2013], the Canadian Association of Petrochemical Producers estimated that total Canadian crude oil production is expected to grow to 6.7 million bpd by 2030 from 2012 production of 3.2 million bpd . Crude oil production from the Bakken Shale in North Dakota has also increased significantly, from approximately 98,000 bpd in 2005 to approximately 934,000 bpd as of January 2014, and is expected to continue to grow due to improvements in unconventional resource production techniques. [April 2014].
The refinery’s location allows it to distribute its refined products throughout the Midwestern United States. The refinery produces a broad slate of refined products including gasoline, diesel, jet fuel and asphalt, which are then marketed to resellers and consumers primarily in the PADD II region.
Northern Tier also owns various storage and transportation assets, including a light products terminal, a heavy products terminal, storage tanks, rail loading/unloading facilities and a Mississippi river dock. The refining business also includes a 17% interest in the Minnesota Pipe Line Company, which owns and operates the Minnesota Pipeline, a 455,000 bpd crude oil pipeline system that transports crude oil (primarily from Western Canada and North Dakota) for approximately 300 miles from the Enbridge pipeline hub at Clearbrook, Minnesota to the refinery. The Minnesota Pipeline has historically transported the majority of the crude oil used and processed in the refinery.
Retail BusinessAs of March 31st, 2014, the retail business operated 164 convenience stores under the SuperAmerica brand and also supported 79 franchised convenience stores, which are also operated under the SuperAmerica brand. These convenience stores are located primarily in Minnesota and Wisconsin and sell various grades of gasoline and diesel, tobacco products and immediately consumable items such as non-alcoholic beverages, beer, prepared food and a large variety of snacks and prepackaged items. The refinery supplies substantially all of the gasoline and diesel sold in the company-operated and franchised convenience stores.
Northern Tier Energy also owns and operates SuperMom’s Bakery, which prepares and distributes baked goods and other prepared food items for sale in the company-operated and franchised convenience stores and other third party locations.
A more indepth presentation of NTI:NYRS ~ GS Presentation FINAL.pdf
WEBSITE:http://www.ntenergy.com/
tax advice http://www.dividend.com/dividend-education/everything-dividend-investors-need-to-know-about-mlps/?utm_source=Dividend.com+-+Free&utm_campaign=8b232b0694-Dispatch_free4_3_2013&utm_
K-1 tax information available on line. See web site under Investors
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