Welcome!

News Feed Item

TC PipeLines, LP Announces Fourth Quarter 2013 Financial Results

HOUSTON, TEXAS -- (Marketwired) -- 02/07/14 -- TC PipeLines, LP (NYSE: TCP) (the Partnership) today reported fourth quarter 2013 Partnership cash flows of $53 million and net income attributable to controlling interests of $41 million. For the year ended December 31, 2013, Partnership cash flows were $195 million and net income attributable to controlling interests was $155 million.

"The Partnership's 2013 results reflect the value added from our approximate one billion dollar acquisition of additional GTN and Bison interests, as well as very solid overall results from our portfolio of long-term contracted pipeline assets," said Steve Becker, President of TC PipeLines, GP, Inc. "Our strong financial position enhances our ongoing value to TransCanada which we expect will drop down the remainder of its U.S. natural gas pipeline portfolio to fund its significant capital program."

Full Year 2013 Highlights and Fourth Quarter Highlights (All financial figures are unaudited)

- Full Year Highlights


--  Partnership cash flows of $195 million
--  Paid cash distributions of $188 million or $3.18 per common unit
--  Increased quarterly cash distributions by 3.8 percent to $0.81 per
    common unit
--  Net income attributable to controlling interests of $155 million or
    $2.13 per common unit
--  Closed acquisition of an additional 45 percent interest in each of Gas
    Transmission Northwest LLC (GTN) and Bison Pipeline LLC (Bison)
--  Raised $373 million in net equity proceeds in connection with the GTN
    and Bison acquisition
--  Entered into new $500 million term loan with a syndicate of lenders to
    partially finance the GTN and Bison acquisition

- Fourth Quarter Highlights


--  Partnership cash flows of $53 million
--  Paid cash distributions of $52 million
--  Declared cash distributions of $0.81 per common unit
--  Net income attributable to controlling interests of $41 million or $0.63
    per common unit
--  Received approval from FERC on Great Lakes' rate case settlement
--  GTN executed Firm Transportation Service Agreement with Portland General
    Electric regarding the Carty Lateral Project expected to be in-service
    in late 2015

The Partnership's financial highlights for the fourth quarter of 2013 and year ended December 31, 2013 compared to the same periods in 2012 were:


                                  Three months ended   Twelve months ended
(unaudited)                          December 31,          December 31,
(millions of dollars except per
 common unit amounts)                 2013       2012       2013       2012
----------------------------------------------------------------------------
Partnership cash flows(a)               53         51        195        202
Cash distributions paid                (52)       (43)      (188)      (169)
Cash distributions paid per
 common unit                         $0.81     $ 0.78      $3.18     $ 3.10
Net income attributable to
 controlling interests(b)               41         44        155        192
Net income per common unit(c)        $0.63     $ 0.56      $2.13     $ 2.51
Weighted average common units
 outstanding (millions)               62.3       53.5       58.9       53.5
Common units outstanding at end
 of period (millions)                 62.3       53.5       62.3       53.5

(a) Partnership cash flows is a non-GAAP financial measure. Refer to the
    description of Partnership Cash Flows in the section of this release
    entitled "Non-GAAP Measures" and the Supplemental Schedule Non-GAAP
    Measures for further detail.
(b) The additional 45 percent membership interests in each of GTN and Bison
    were acquired from subsidiaries of TransCanada. As a result, the
    acquisition was accounted for as a transaction between entities under
    common control, similar to a pooling of interests, whereby the assets
    and liabilities of GTN and Bison were recorded at TransCanada's carrying
    value and the Partnership's historical financial information was recast
    to consolidate GTN and Bison for all periods presented.
(c) Net income per common unit for the three and twelve months ended
    December 31, 2012 is equivalent to that presented prior to the recast.
    Refer to the description of Net income per common unit in the Financial
    Summary Schedule for further detail.

Recent Developments

Cash Distributions - On January 16, 2014, the board of directors of our General Partner declared the Partnership's fourth quarter 2013 cash distribution in the amount of $0.81 per common unit, payable on February 14, 2014 to unitholders of record as of January 28, 2014.

GTN - In the fourth quarter 2013, GTN and Portland General Electric Company (PGE) executed a Firm Transportation Service Agreement (FTSA) for the approximately $54 million Carty Lateral Project (Carty Lateral). The Carty Lateral is expected to be in-service in the fourth quarter of 2015. In addition to a 30-year contract for 100 percent of the capacity of the Carty Lateral, PGE executed a 20-year GTN mainline contract for 75,000 Dth/day supplying firm natural gas service commencing in the second quarter of 2016. The execution of the FTSA triggers a $25 million payment by the Partnership to TransCanada in connection with the GTN acquisition in 2013.

Great Lakes Rate Settlement - On November 14, 2013, FERC approved a settlement between Great Lakes and Great Lakes' customers to modify its transportation rates effective November 1, 2013.

Results of Operations

For the three months ended December 31, 2013, net income attributable to controlling interests decreased to $41 million compared to the fourth quarter of 2012 after the recast. The decrease was primarily due to higher financial charges as a result of the $500 million term loan obtained to finance a portion of the 2013 acquisition.

Partnership cash flows increased to $53 million in the fourth quarter of 2013 compared to $51 million in the same period of 2012. This increase was primarily due to the increased cash distributions from GTN and Bison as a result of the 2013 acquisition. It was partially offset by lower cash distributions from Northern Border and Great Lakes.

Cash distributions from Northern Border decreased in the fourth quarter of 2013 compared to the same period of 2012 primarily due to the 11 percent reduction in reservation rates resulting from the Northern Border settlement which became effective in January 2013.

Cash distributions from Great Lakes decreased in the fourth quarter of 2013 compared to the same period of 2012 primarily due to lower revenue from capacity contracted at lower rates and volumes.

Distributions paid in the fourth quarter of 2013 increased compared to the same period in 2012 due to a $0.03 increase in the distribution per common unit in July 2013, as well as an increase in the number of common units outstanding resulting from the equity issuance in May 2013.

Non-GAAP Measures

The Partnership uses the non-GAAP financial measures "Partnership cash flows" and "Partnership cash flows before General Partner distributions" as they provide measures of cash generated during the period to evaluate our cash distribution capability. Management also uses these measures as a basis for recommendations to our General Partner's board of directors regarding the distribution to be declared each quarter. Partnership cash flow information is presented to enhance investors' understanding of the way management analyzes the Partnership's financial performance.

Partnership cash flows include net income attributable to controlling interests, less net income attributed to GTN's and Bison's former parent, plus operating cash flows from North Baja and Tuscarora, and cash distributions received from GTN, Northern Border, Bison and Great Lakes less equity earnings from unconsolidated affiliates and Other Pipes' net income as previously reported, plus net income attributable to non-controlling interests from consolidated subsidiaries after the 2013 acquisition, and net of distributions declared to the General Partner.

Partnership cash flows and Partnership cash flows before General Partner distributions are provided as a supplement to GAAP financial results and are not meant to be considered in isolation or as substitutes for financial results prepared in accordance with GAAP.

Conference Call

Analysts, members of the media, investors and other interested parties are invited to participate in a teleconference by calling 866.226.1793 on Friday, February 7, 2014 at 10 a.m. central time (CT)/11 a.m. eastern time (ET). Steve Becker, President of the General Partner, will discuss the fourth quarter and full year 2013 financial results and provide an update on the Partnership's business developments, followed by a question and answer session for the investment community and media. Please dial in 10 minutes prior to the start of the call. No pass code is required. A live webcast of the conference call will also be available through the Partnership's website at www.tcpipelineslp.com. Slides for the presentation will be posted on the Partnership's website under "Events and Presentations" prior to the webcast.

A replay of the teleconference will also be available beginning two hours after the conclusion of the call and until 11 p.m. (CT)/midnight (ET) on February 14, 2014, by calling 800.408.3053, then entering pass code 9135626.

TC PipeLines, LP is a Delaware master limited partnership with interests in six federally regulated U.S. interstate natural gas pipelines which serve markets in western and mid-western United States and Eastern Canada. The Partnership is managed by its general partner, TC PipeLines GP, Inc., a subsidiary of TransCanada Corporation (NYSE: TRP). For more information about TC PipeLines, LP, visit the Partnership's website at www.tcpipelineslp.com.

Forward-Looking Statements

Certain non-historical statements in this release relating to future plans, projections, events or conditions, including our belief that the Partnership is well positioned to deliver long-term value and solid results in the future and the potential for further dropdowns from TransCanada, are intended to be "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements are based on current expectations and, therefore, subject to a variety of risks and uncertainties that could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this release, including, without limitation, competitive conditions in the natural gas industry, increases in operating and compliance costs, the outcome of rate proceedings, our ability to identify and complete expansion and growth opportunities, operating hazards beyond our control, availability of capital and market demand that the Partnership expects or believes will or may occur in the future. These and other factors that could cause future results to differ materially from those anticipated are discussed in Item 1A in our Annual Report on Form 10-K for the year-ended December 31, 2012 filed with the Securities and Exchange Commission (the "SEC"), as updated and supplemented by subsequent filings with the SEC. All forward-looking statements are made only as of the date made and except as required by applicable law, we undertake no obligation to update any forward-looking statements to reflect new information, subsequent events or other changes.


                              TC PipeLines, LP
                              Financial Summary

Consolidated Statement of Income
                                 Three months ended    Twelve months ended
(unaudited)                          December 31,          December 31,
(millions of dollars except per
 common unit amounts)                 2013     2012(a)    2013(a)    2012(a)
----------------------------------------------------------------------------
Transmission revenues                   88         87        341        343
Equity earnings from
 unconsolidated affiliates              19         22         67         99
Operation and maintenance
 expenses                              (16)       (17)       (55)       (57)
Property taxes                          (5)        (7)       (23)       (25)
General and administrative              (1)        (1)        (9)        (6)
Depreciation                           (22)       (21)       (86)       (85)
Financial charges and other            (13)       (10)       (44)       (40)
                                --------------------------------------------
Net income                              50         53        191        229
                                --------------------------------------------

Net income attributable to non-
 controlling interests                   9          9         36         37
                                --------------------------------------------
Net income attributable to
 controlling interests                  41         44        155        192
                                --------------------------------------------

Net income attributable to
 controlling interests
 allocation(b)
Common units                            40         29        126        134
General partner                          1          1          3          3
                                --------------------------------------------
                                        41         30        129        137
                                --------------------------------------------

Net income per common unit -
 basic and diluted(c)               $ 0.63     $ 0.56     $ 2.13     $ 2.51
                                --------------------------------------------

Weighted average common units
 outstanding (millions) - basic
 and diluted                          62.3       53.5       58.9       53.5
                                --------------------------------------------

Common units outstanding, end of
 the period (millions)                62.3       53.5       62.3       53.5
                                --------------------------------------------

(a) Financial information was recast to consolidate GTN and Bison.
(b) Net income attributable to controlling interest allocation excludes net
    income attributed to GTN's and Bison's former parent. Net income
    attributed to GTN's and Bison's former parent was $14 million and $55
    million for the three and twelve months ended December 31, 2012,
    respectively and $26 million in 2013.
(c) Net income per common unit is computed by dividing net income
    attributable to controlling interests, after deduction of the General
    Partner's allocation and net income attributed to GTN's and Bison's
    former parent, by the weighted average number of common units
    outstanding. The General Partner's allocation is computed based upon the
    General Partner's effective two percent general partner interest plus an
    amount equal to incentive distributions. On May 22, 2013, the
    Partnership issued 8.855 million common units in a public offering.

                              TC PipeLines, LP
                              Financial Summary

Consolidated Condensed Balance Sheet

(unaudited)
(millions of dollars)                December 31, 2013  December 31, 2012(a)
----------------------------------------------------------------------------
ASSETS
Current assets                                      69                    69
Investment in unconsolidated
 affiliates                                      1,195                 1,189
Plant, property and equipment                    2,041                 2,111
Other assets                                       137                   136
                                --------------------------------------------
                                                 3,442                 3,505
                                --------------------------------------------

----------------------------------------------------------------------------
LIABILITIES AND PARTNERS' EQUITY
Current liabilities                                 51                    49
Other liabilities                                   24                    21
Long-term debt, including
 current portion                                 1,578                 1,013
Partners' equity                                 1,789                 2,422
                                --------------------------------------------
                                                 3,442                 3,505
                                --------------------------------------------

(a) Financial information was recast to consolidate GTN and Bison.

                              TC PipeLines, LP
                            Supplemental Schedule
Non-GAAP Measures
Reconciliation of Net Income attributable to controlling interests to
Partnership Cash Flows

                                  Three months ended   Twelve months ended
(unaudited)                          December 31,          December 31,
(millions of dollars except per
 common unit amounts)                 2013       2012       2013       2012
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Net income attributable to
 controlling interests(d)               41         44        155        192
Less net income attributed to
 GTN's and Bison's former
 parent(d)                               -        (14)       (26)       (55)
                                --------------------------------------------
Net income as previously
 reported                               41         30        129        137

Add:
Cash distributions from GTN (a)         21          8         54         28
Cash distributions from Northern
 Border (a)                             18         25         84         96
Cash distributions from Bison
 (a)                                    11          4         29         16
Cash distributions from Great
 Lakes (a)                               2         10         17         44
Cash flows provided by North
 Baja's and Tuscarora's
 operating activities                   11         12         50         49
                                --------------------------------------------
                                        63         59        234        233

Less:
Equity earnings as previously
 reported:
  GTN                                    -         (4)        (9)       (19)
  Northern Border                      (16)       (18)       (64)       (72)
  Bison                                  -         (3)        (6)       (11)
  Great Lakes                           (3)        (4)        (3)       (27)
                                --------------------------------------------
                                       (19)       (29)       (82)      (129)
Less:
Other Pipes' net income as
 previously reported (e)
  GTN                                  (20)         -        (39)         -
  Bison                                (12)         -        (23)         -
  North Baja                            (4)        (4)       (22)       (21)
  Tuscarora                             (4)        (4)       (16)       (15)
                                --------------------------------------------
                                       (40)        (8)      (100)       (36)
Add:
Net income attributable to non-
 controlling interests after the
 2013 acquisition                        9          -         18          -
                                --------------------------------------------

Partnership cash flows before
 General Partner distributions          54         52        199        205
General Partner distributions
 (b)                                    (1)        (1)        (4)        (3)
                                --------------------------------------------

Partnership cash flows                  53         51        195        202
                                --------------------------------------------

Cash distributions declared            (52)       (43)      (197)      (170)
Cash distributions declared per
 common unit (c)                     $0.81      $0.78      $3.21      $3.11
Cash distributions paid                (52)       (43)      (188)      (169)
Cash distributions paid per
 common unit (c)                     $0.81      $0.78      $3.18      $3.10
                                --------------------------------------------
                                --------------------------------------------

(a) In accordance with the cash distribution policies of the respective
    entities, cash distributions from GTN, Northern Border, Bison and Great
    Lakes, are based on their respective prior quarter financial results.
    Distributions from GTN and Bison are based on 70 percent ownership
    starting from July 1, 2013.
(b) General Partner distributions represent the cash distributions paid to
    the General Partner with respect to its two percent interest plus an
    amount equal to incentive distributions. Incentive distributions in 2013
    and 2012 were nil.
(c) Cash distributions declared per common unit and cash distributions paid
    per common unit are computed by dividing cash distributions, after the
    deduction of the General Partner's allocation, by the number of common
    units outstanding. The General Partner's allocation is computed based
    upon the General Partner's two percent interest plus an amount equal to
    incentive distributions.
(d) Financial information was recast to consolidate GTN and Bison for all
    periods presented. Prior to the 2013 acquisition, our net income was $30
    million and $137 million for the three and twelve months ended December
    31, 2012, respectively, reflecting 25 percent ownership in each of GTN
    and Bison. As a result of the recast, net income attributable to
    controlling interests is $44 million and $192 million for the three and
    twelve months ended December 31, 2012, respectively, as if we owned 70
    percent in each of GTN and Bison. Net income attributed to GTN's and
    Bison's former parent of $14 million and $55 million, reflecting the 45
    percent interests not then owned by the Partnership, for the three and
    twelve months ended December 31, 2012, respectively, reconciles the net
    income as previously reported and net income attributable to controlling
    interests.
(e) "Other Pipes" includes the results of North Baja and Tuscarora prior to
    July 1, 2013, plus the results of GTN and Bison after July 1, 2013.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Historically, some banking activities such as trading have been relying heavily on analytics and cutting edge algorithmic tools. The coming of age of powerful data analytics solutions combined with the development of intelligent algorithms have created new opportunities for financial institutions. In his session at 20th Cloud Expo, Sebastien Meunier, Head of Digital for North America at Chappuis Halder & Co., will discuss how these tools can be leveraged to develop a lasting competitive advanta...
SYS-CON Events announced today that Loom Systems will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Founded in 2015, Loom Systems delivers an advanced AI solution to predict and prevent problems in the digital business. Loom stands alone in the industry as an AI analysis platform requiring no prior math knowledge from operators, leveraging the existing staff to succeed in the digital era. With offices in S...
SYS-CON Events announced today that Interoute, owner-operator of one of Europe's largest networks and a global cloud services platform, has been named “Bronze Sponsor” of SYS-CON's 20th Cloud Expo, which will take place on June 6-8, 2017 at the Javits Center in New York, New York. Interoute is the owner-operator of one of Europe's largest networks and a global cloud services platform which encompasses 12 data centers, 14 virtual data centers and 31 colocation centers, with connections to 195 add...
SYS-CON Events announced today that HTBase will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. HTBase (Gartner 2016 Cool Vendor) delivers a Composable IT infrastructure solution architected for agility and increased efficiency. It turns compute, storage, and fabric into fluid pools of resources that are easily composed and re-composed to meet each application’s needs. With HTBase, companies can quickly prov...
SYS-CON Events announced today that CA Technologies has been named “Platinum Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY, and the 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. CA Technologies helps customers succeed in a future where every business – from apparel to energy – is being rewritten by software. From ...
What if you could build a web application that could support true web-scale traffic without having to ever provision or manage a single server? Sounds magical, and it is! In his session at 20th Cloud Expo, Chris Munns, Senior Developer Advocate for Serverless Applications at Amazon Web Services, will show how to build a serverless website that scales automatically using services like AWS Lambda, Amazon API Gateway, and Amazon S3. We will review several frameworks that can help you build serverle...
SYS-CON Events announced today that SoftLayer, an IBM Company, has been named “Gold Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. SoftLayer, an IBM Company, provides cloud infrastructure as a service from a growing number of data centers and network points of presence around the world. SoftLayer’s customers range from Web startups to global enterprises.
Culture is the most important ingredient of DevOps. The challenge for most organizations is defining and communicating a vision of beneficial DevOps culture for their organizations, and then facilitating the changes needed to achieve that. Often this comes down to an ability to provide true leadership. As a CIO, are your direct reports IT managers or are they IT leaders? The hard truth is that many IT managers have risen through the ranks based on their technical skills, not their leadership abi...
The essence of cloud computing is that all consumable IT resources are delivered as services. In his session at 15th Cloud Expo, Yung Chou, Technology Evangelist at Microsoft, demonstrated the concepts and implementations of two important cloud computing deliveries: Infrastructure as a Service (IaaS) and Platform as a Service (PaaS). He discussed from business and technical viewpoints what exactly they are, why we care, how they are different and in what ways, and the strategies for IT to transi...
After more than five years of DevOps, definitions are evolving, boundaries are expanding, ‘unicorns’ are no longer rare, enterprises are on board, and pundits are moving on. Can we now look at an evolution of DevOps? Should we? Is the foundation of DevOps ‘done’, or is there still too much left to do? What is mature, and what is still missing? What does the next 5 years of DevOps look like? In this Power Panel at DevOps Summit, moderated by DevOps Summit Conference Chair Andi Mann, panelists l...
Web Real-Time Communication APIs have quickly revolutionized what browsers are capable of. In addition to video and audio streams, we can now bi-directionally send arbitrary data over WebRTC's PeerConnection Data Channels. With the advent of Progressive Web Apps and new hardware APIs such as WebBluetooh and WebUSB, we can finally enable users to stitch together the Internet of Things directly from their browsers while communicating privately and securely in a decentralized way.
All organizations that did not originate this moment have a pre-existing culture as well as legacy technology and processes that can be more or less amenable to DevOps implementation. That organizational culture is influenced by the personalities and management styles of Executive Management, the wider culture in which the organization is situated, and the personalities of key team members at all levels of the organization. This culture and entrenched interests usually throw a wrench in the work...
Keeping pace with advancements in software delivery processes and tooling is taxing even for the most proficient organizations. Point tools, platforms, open source and the increasing adoption of private and public cloud services requires strong engineering rigor - all in the face of developer demands to use the tools of choice. As Agile has settled in as a mainstream practice, now DevOps has emerged as the next wave to improve software delivery speed and output. To make DevOps work, organization...
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm.
What sort of WebRTC based applications can we expect to see over the next year and beyond? One way to predict development trends is to see what sorts of applications startups are building. In his session at @ThingsExpo, Arin Sime, founder of WebRTC.ventures, will discuss the current and likely future trends in WebRTC application development based on real requests for custom applications from real customers, as well as other public sources of information,