Blueknight Energy Partners, L.P. reported a fourth quarter 2020 net loss of more than $29 million but also indicated that since the end of the year, it had managed to slash its company-wide debt by nearly $153 million.
The Tulsa firm’s net loss for the quarter was $29.2 million compared to a net income of $4.3 million for the same quarter in 20219. Blueknight leadership blamed the loss largely on a more than $39 million impairment of its crude oil pipeline and trucking assets included in discontinued operations.
Adjusted earnings before interest, taxes, depreciation and amortization was $17.8 million in fourth quarter 2020 compared to $16.0 million for the same period in 2019. Adjusted EBITDA in fourth quarter 2020 excluded $0.7 million in transaction fees and severance costs related to the sale of the crude oil business.
“We ended 2020 with strong performance in our asphalt terminalling segment to cap off one of our best years despite challenges brought on by COVID-19, a testament to the stability and strength of our core businesses and solid execution by our team,” commented Andrew Woodward, Chief Executive Officer.
He said Blueknight’s sale of its crude oil businesses resulted in a significant reduction of the volatility and risk profile of the business and allows the company to have a sharper strategic focus.
Blueknight announced in December it had sold its crude oil terminalling, crude oil pipeline and crude oil trucking segments.
The company’s asphalt terminalling services division had a $16.5 million total operating margin which was 4% better than a year earlier. The full year 2020 operating margin was $60.8 million, slightly better than the 2019 margin.
Fourth quarter 2020 distributable cash flow was $13.3 million compared to $11.0 million for the same period in 2019. The 21% increase was attributable to improved business performance and lower cash interest expense. The calculated coverage ratio on all distributions was 1.64 times for fourth quarter 2020 versus 1.36 times for the same period in 2019.
At December 31, 2020, total debt was $252.6 million. Blueknight’s leverage ratio, which included $1.7 million in outstanding letters of credit, was 3.83 times versus 4.05 times for the same period in 2019.
As of March 4, 2021, total debt was $99.9 million following repayment of cash proceeds from the Crude Oil Transaction, representing a pro-forma leverage ratio of approximately 2.0 times.
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