Monday, petroleum products terminalling, storage and transportation company NuStar Energy L.P. (NS) reported a surge in earnings for the second quarter, which topped analysts' estimates, helped by robust contributions from asphalt and storage operations. The San Antonio-based company also provided guidance for the third quarter and announced an increase in distribution for the quarter.
Net income applicable to limited partners for the quarter surged to $75.1 million or $1.38 per unit from $8.1 million or $0.15 per unit in the corresponding period last year.
Included in the earnings for the most recent quarter is an $18.8 million, or $0.34 per unit, net gain primarily from the sale of pipelines. Excluding items, adjusted earnings were $56.7 million, or $1.04 per unit, which topped the $0.97 per unit projected by thirteen analysts polled by Thomson Reuters. Analysts' estimates typically exclude special items.
Total revenues declined to $987.8 million from $1.38 billion in the year-ago quarter. Six Street analysts expected the company to report revenues of $1.15 billion for the quarter.
Revenues from Services declined to $176.0 million from $180.6 million, while revenues from Product sales declined to $811.8 million from $1.20 billion last year.
NuStar said asphalt margins per barrel for the quarter soared to $9.10 from $1.37 in the same period last year due to the company's strategy of producing and storing asphalt inventories at lower costs during the winter months and selling these same inventories at higher prices during the asphalt season.
The company said that distributable cash flow available to limited partners of $123.4 million, or $2.27 per unit, for the quarter were four times higher than the $31.5 million, or $0.58 per unit, for the second quarter of 2008
For the six month period, net income applicable to limited partners rose to $106.8 million, or $1.96 per unit, from $57.7 million, or $1.11 per unit, in the same period last year. Revenues, however, declined to $1.62 billion from $1.97 billion in the year-ago period.
Looking ahead, the company expects earnings for the third quarter to be in the range of $1.10 to $1.50 per unit. Analysts currently expect the company to earn $2.15 per unit for the quarter.
The company said it expects to see strong results from its storage segment and asphalt operations for the second half of 2009. Nu Star noted that margins will likely not be nearly as good in the third quarter compared to last year's third quarter, but fourth quarter margins should be significantly better than last year's fourth quarter.
NuStar Energy also said that its board has declared a distribution of $1.0575 per unit, an increase of $0.0725 per unit, or 7.4%, over the $0.985 distribution for the second quarter of 2008. The distribution is payable on August 13 to holders of record as of August 6.
NUS is currently up $0.82 or 1.46% and trades at $57.05.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.