(RTTNews) - Tuesday, refined petroleum products distributor Magellan Midstream Partners, L.P. (MMP: News ), reported a decline in profit for the third quarter as revenues dropped from last year on lower commodity prices and diesel fuel shipments. The company slashed its earnings forecast for fiscal year 2009. Magellan also provided its outlook for the fourth quarter.

The Tulsa, Oklahoma-based company's net income for the third quarter declined to $54.21 million or $0.43 per limited partner unit from $69.35 million or $0.46 per limited partner unit in the year ago quarter. The year ago 2008 period benefited from unusually high product margin.

Excluding accounting implications of simplification, net income for the quarter would have been $58.46 million or $0.58 per limited partner unit.

On average, 13 analysts polled by Thomson Reuters expected the company to report earnings of $0.61 per share for the quarter. Analysts' estimates typically exclude one-time charges and gains.

Total revenues for the quarter declined to $239.77 million from $292.19 million last year. Seven analysts had a consensus revenue estimate of $248.31 million for the quarter.

Segment wise, Transportation and terminals revenue for the quarter rose to $173.50 million from $164.47 million in the same quarter last year. Product sales revenue plunged to $66.08 million from $127.54 million last year. Affiliate management fee revenue rose to $190 million from $183 million a year earlier.
Total costs and expenses for the quarter were reduced to $166.38 million, from $210.47 million in the same quarter last year, while operating profit decreased to $54.68 million from $69.88 million last year.

Don Wellendorf, chief executive officer, said, "Magellan continues to benefit from higher results from our core transportation and terminals assets even during the current challenging economic environment. Record quarterly gasoline shipments and record results from our terminals segment, driven in part from expansion projects, have helped to offset the negative impact of lower commodity prices and lower diesel fuel shipments this year."

For the nine-month period, net income dropped sharply to $144.52 million or $1.11 per limited partner unit from $249.04 million or $1.70 per limited partner unit in the corresponding period last year. Total revenues plunged to $660.92 million from $912.03 million a year ago.

Looking ahead to the fourth quarter, the company expects net income per limited partner unit of $0.78. Analysts have an earnings consensus of $0.81 per unit for the fourth quarter.

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