Americas News
NuStar Predicts Profitable Bunker Business by Q4
Bunker operations of NuStar Energy LP [NYSE:NS] (NuStar) were in the red during the second quarter of the year, but it expects them to be profitable by the end of the year, President and CEO Curt Anastasio said in an earnings call.
"Reduced worldwide demand for bunker fuels plus increase supply in the U.S. Gulf Coast and the Caribbean caused our bunker operations to continue to generate negative EBITDA [earnings before interest, taxes, depreciation and amortization] during the quarter," he said.
"As a result of profit improvement initiatives we're in the process of implementing, bunker operations should break-even in the third quarter and start generating positive EBITDA in the fourth quarter of this year."
The company reported a second quarter net income of $21.6 million overall, up from a loss of $251.6 million in the second quarter of 2012, a turnaround it attributed to its involvement in shale crude oil projects in Texas.
Anastasio said the fuels marketing segment, which represents about 10 percent of NuStar's business, generated a "small profit" despite "continued weak demand for bunkers and increased competition in the Caribbean."
The company's overall EBITDA from continuing operations rose to $112.8 million from negative $161.4 million year over year.
