PR Newswire | Jul 31, 2020 06:31AM EDT

Second Quarter 2020 Earnings Results

07/31 05:30 CDT

PBF Logistics Declares Quarterly Distribution of $0.30 per Unit and Announces Second Quarter 2020 Earnings Results- Second quarter net income attributable to the limited partners of $37.5 million, or $0.60 per common unit, EBITDA attributable to PBFX of $58.9 million and Adjusted EBITDA of $60.0 million- Strong base of contracted minimum volume commitments support 90% of $89.1 million total revenue- Declares quarterly distribution of $0.30 per unit PARSIPPANY, N.J., July 31, 2020

PARSIPPANY, N.J., July 31, 2020 /PRNewswire/ -- PBF Logistics LP (NYSE:PBFX, the "Partnership") today announced second quarter 2020 net income attributable to the limited partners of $37.5 million, or $0.60 per common unit. During the quarter, the Partnership generated cash from operations of $61.0 million, EBITDA attributable to PBFX of $58.9 million, Adjusted EBITDA of $60.0 million and distributable cash flow of $47.0 million. Included in reported results for the second quarter are $1.1 million, or $0.02 per common unit, of expenses related to pending and non-consummated acquisitions, non-cash unit-based compensation and environmental remediation costs associated with the East Coast Terminals.

"Our focus during the second quarter was on the safety of our employees and operations as we implemented many additional safety protocols to ensure business continuity. Our strong contracted minimum volume commitments largely insulated us from the impacts of the pandemic and resulting decrease in volumes. We continued to support our customers during this disruptive time and we expect our revenues to remain well-supported by our long-term contracts in the coming quarters," said PBF Logistics GP LLC Executive Vice President Matt Lucey. "We announced a distribution of $0.30 per unit today and used excess cash to reduce leverage by paying down a portion of our revolving credit facility. Delevering the business and strengthening the balance sheet will position the Partnership to be opportunistic."

As of June 30, 2020, the Partnership had approximately $268.7 million of liquidity, including approximately $21.6 million in cash and cash equivalents, and access to approximately $247.1 million under its revolving credit facility.

PBF Logistics Declares Quarterly DistributionThe board of directors of PBF Logistics GP LLC, the Partnership's general partner, declared a regular quarterly cash distribution of $0.30 per common unit. The distribution is payable on August 26, 2020, to unitholders of record at the close of business on August 13, 2020.

This release is intended to be a qualified notice to nominees under Treasury Regulations Section 1.1446-4(b). All of the Partnership's distributions to foreign investors are attributable to income that is effectively connected with a United States trade or business. Accordingly, the Partnership's distributions to foreign investors are subject to federal income tax withholding at the highest effective tax rate.

Non-GAAP Financial MeasuresThe Partnership defines EBITDA as net income (loss) before net interest expense (including amortization of loan fees and debt premium and accretion on discounted liabilities), income tax expense, depreciation, amortization and change in contingent consideration. The Partnership defines EBITDA attributable to PBFX as net income (loss) attributable to PBFX before net interest expense (including amortization of loan fees and debt premium and accretion on discounted liabilities), income tax expense, depreciation, amortization and change in contingent consideration attributable to PBFX, which excludes results of acquisitions from affiliates of PBF Energy prior to the effective dates of such transactions and earnings attributable to the CPI earn-out (the portion of earnings associated with an earn-out provision related to the purchase of CPI Operations LLC ("CPI"),(the "Contingent Consideration")). The Partnership defines Adjusted EBITDA as EBITDA attributable to PBFX excluding acquisition and transaction costs, non-cash unit-based compensation expense and items that meet the conditions of unusual, infrequent and/or non-recurring charges. The Partnership defines distributable cash flow as EBITDA attributable to PBFX plus non-cash unit-based compensation expense, less cash interest, maintenance capital expenditures attributable to PBFX and income taxes. Distributable cash flow will not reflect changes in working capital balances. EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow are not presentations made in accordance with U.S. generally accepted accounting principles ("GAAP").

For additional information on the Partnership's non-GAAP financial measures, including reconciliations to their most directly comparable financial measures calculated and presented in accordance with GAAP, refer to the supplemental information provided in "Results of Operations" and the Earnings Release Tables included herein.

Conference Call InformationThe Partnership will host a conference call and webcast regarding second quarter results and other business matters on Friday, July 31, 2020, at 11:00 a.m. ET. The call is being webcast and can be accessed at PBF Logistics' website, http://www.pbflogistics.com. The call can also be accessed by dialing (800) 459-5346 or (203) 518-9544, conference ID: PBFXQ220. The audio replay will be available two hours after the end of the call through August 14, 2020, by dialing (800) 753-5207 or (402) 220-2156.

Forward-Looking StatementsThis press release contains forward-looking statements (as that term is defined under the federal securities laws) made by the Partnership and its management. Such statements are based on current expectations, forecasts and projections, including, but not limited to, anticipated financial and operating results, plans, objectives, expectations and intentions that are not historical in nature. Forward-looking statements should not be read as a guarantee of future performance or results, and may not necessarily be accurate indications of the times at, or by which, such performance or results will be achieved. Forward-looking statements are based on information available at the time, and are subject to various risks and uncertainties, including risks relating to the securities markets generally, the impact of adverse market conditions impacting PBFX's logistics and other assets, the possibility that the Partnership may not consummate any potential future acquisitions, the Partnership's plans for financing any potential future acquisitions, the duration and severity of the COVID-19 pandemic, and other risks inherent in PBFX's business. For more information concerning factors that could cause actual results to differ from those expressed or forecasted, see PBFX's filings with the Securities and Exchange Commission including its most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. Forward-looking statements reflect information, facts and circumstances only as of the date they are made. The Partnership assumes no responsibility or obligation to update forward-looking statements except as may be required by law.

PBF Logistics LPPBF Logistics LP, headquartered in Parsippany, New Jersey, is a fee-based, growth-oriented master limited partnership formed by PBF Energy Inc. to own or lease, operate, develop and acquire crude oil and refined petroleum products terminals, pipelines, storage facilities and similar logistics assets.

Results of Operations (Unaudited)

Business Developments

COVID-19

The recent outbreak of the coronavirus disease 2019 ("COVID-19") pandemic continues to negatively impact worldwide economic and commercial activity and financial markets, as well as global demand for petroleum and petrochemical products. The COVID-19 pandemic and resulting governmental and consumer responses have also resulted in significant business and operational disruptions, including business and school closures, supply chain disruptions, travel restrictions, stay-at-home orders and limitations on the availability of workforces. Such impacts have resulted in revenue declines due to lower demand and throughput volumes across certain of our facilities, which may continue to affect our business for the foreseeable future. In response to the COVID-19 pandemic, we are taking steps to mitigate potential adverse impacts on our business and operations by limiting capital expenditures, reducing discretionary activities and third-party services and lowering our quarterly distribution to our minimum quarterly distribution of $0.30 per unit. This distribution reduction, effective with the distribution for the first quarter of 2020 that was paid on June 17, 2020, represents a strategic shift to build our cash flow coverage, de-lever our business and increase our financial resources as we continue to identify potential organic growth projects or strategic acquisitions. In addition, our parent sponsor and largest customer, PBF Energy Inc., has endeavored to take the necessary steps to preserve liquidity and solidify its operations under the adverse market conditions caused by the COVID-19 pandemic.

The full extent to which the COVID-19 pandemic impacts our business and operations, or that of our parent sponsor, is unknown and will depend on the severity, location and duration of the effects and spread of COVID-19, the actions undertaken by national, regional and local governments and health officials to contain the virus or treat its effects, related consumer responses and how quickly and to what extent economic conditions improve and normal business and operating conditions resume.

Factors Affecting Comparability

The following tables present our results of operations, related operational information and reconciliations of net income and net cash provided by operating activities to our EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow (each as defined below) for the three and six months ended June 30, 2020 and 2019.

On October 1, 2018, we acquired from Crown Point International, LLC, its wholly-owned subsidiary, CPI Operations LLC ("CPI"), whose assets include a storage facility with multi-use storage capacity, an Aframax-capable marine facility, a rail facility, a truck terminal, equipment, contracts and certain other idled assets (the "East Coast Storage Assets") located on the Delaware River near Paulsboro, New Jersey (the "East Coast Storage Assets Acquisition"). In connection with the acquisition, the purchase and sale agreement included an earn-out provision related to an existing commercial agreement with a third party, based on the future results of certain of the acquired idled assets, which recommenced operations in October 2019.

On April 24, 2019, we entered into a Contribution Agreement with PBF Energy Company LLC ("PBF LLC"), pursuant to which PBF LLC contributed to us all of the issued and outstanding limited liability company interests of TVP Holding Company LLC ("TVP Holding"), which held the remaining 50% equity interest in Torrance Valley Pipeline Company LLC ("TVPC"), for total consideration of $200.0 million (the "TVPC Acquisition"). Subsequent to the closing of the TVPC Acquisition on May 31, 2019, we own 100% of the equity interest in TVPC.

On April 24, 2019, we entered into subscription agreements to sell an aggregate of 6,585,500 common units to certain institutional investors in a registered direct public offering (the "2019 Registered Direct Offering") for gross proceeds of approximately $135.0 million. The 2019 Registered Direct Offering closed on April 29, 2019.

In addition, our results in the current year have been negatively affected by the impact of the COVID-19 pandemic on our business, including lower throughput volumes at our terminals, as the industry reacts to the related economic downturn and volatile commodity markets.

As a result of the factors above, the information included in the following tables is not necessarily comparable on a year-over-year basis.

Non-GAAP Financial Measures

We define EBITDA as net income (loss) before net interest expense (including amortization of loan fees and debt premium and accretion on discounted liabilities), income tax expense, depreciation, amortization and change in contingent consideration. We define EBITDA attributable to PBFX as net income (loss) attributable to PBFX before net interest expense (including amortization of loan fees and debt premium and accretion on discounted liabilities), income tax expense, depreciation, amortization and change in contingent consideration attributable to PBFX, which excludes the results of acquisitions from PBF LLC prior to the effective dates of such transactions and earnings attributable to the CPI earn-out (the portion of earnings associated with an earn-out provision related to the purchase of CPI (the "Contingent Consideration")). We define Adjusted EBITDA as EBITDA attributable to PBFX excluding acquisition and transaction costs, non-cash unit-based compensation expense and items that meet the conditions of unusual, infrequent and/or non-recurring charges. We define distributable cash flow as EBITDA attributable to PBFX plus non-cash unit-based compensation expense, less cash interest, maintenance capital expenditures attributable to PBFX and income taxes. Distributable cash flow will not reflect changes in working capital balances. We use distributable cash flow to calculate a measure we refer to as our coverage ratio. Our coverage ratio is calculated by dividing distributable cash flow by our total distribution declared. EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow are not presentations made in accordance with U.S. generally accepted accounting principles ("GAAP").

While EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow are not presentations made in accordance with GAAP, they are supplemental financial measures that management and external users of our condensed consolidated financial statements, such as industry analysts, investors, lenders and rating agencies, may use to assess:

* our operating performance as compared to other publicly traded partnerships in the midstream energy industry, without regard to historical cost basis or, in the case of EBITDA, financing methods; * the ability of our assets to generate sufficient cash flow to make distributions to our unitholders; * our ability to incur and service debt and fund capital expenditures; and * the viability of acquisitions and other capital expenditure projects and the economic returns on various investment opportunities.

We believe that the presentation of EBITDA, EBITDA attributable to PBFX and Adjusted EBITDA provides useful information to investors in assessing our financial condition and results of operations and assists in evaluating our ongoing operating performance for current and comparative periods. We believe that the presentation of distributable cash flow provides useful information to investors as it is a widely accepted financial indicator used by investors to compare partnership performance and it provides investors with another perspective of the operating performance of our assets and the cash our business is generating. However, EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow should not be considered alternatives to net income, income from operations, net cash provided by operating activities or any other measure of financial performance or liquidity presented in accordance with GAAP.

EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow have important limitations as analytical tools because they exclude some, but not all, items that affect net income and net cash provided by operating activities. EBITDA, EBITDA attributable to PBFX, Adjusted EBITDA and distributable cash flow are reconciled to their most directly comparable financial measures calculated and presented in accordance with GAAP in the Earnings Release Tables included herein.

These non-GAAP financial measures should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Our definitions of these non-GAAP financial measures may not be comparable to similarly titled measures of other partnerships, because they may be defined differently by other partnerships in our industry, thereby limiting their utility.

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in thousands, except unit and per unit data)

Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019

Revenue (a):

Affiliate $ 72,422 $74,656$147,965 $145,988

Third-party 16,707 8,094 34,193 15,607

Total revenue 89,129 82,750 182,158 161,595



Costs and expenses:

Operating and maintenance expenses (a) 23,154 28,553 52,655 58,469

General and administrative expenses 4,299 7,580 8,686 13,590

Depreciation and amortization 11,234 8,854 22,516 17,575

Change in contingent consideration 324 - 530 -

Total costs and expenses 39,011 44,987 84,387 89,634



Income from operations 50,118 37,763 97,771 71,961



Other expense:

Interest expense, net (11,536) (11,216) (23,385) (22,129)

Amortization of loan fees and debt premium (542) (446) (981) (895)

Accretion on discounted liabilities (580) (773) (1,132) (1,533)

Net income 37,460 25,328 72,273 47,404

Less: Net income attributable to noncontrolling interest (g)- 3,162 - 7,881

Net income attributable to PBF Logistics LP unitholders $ 37,460 $22,166$72,273 $39,523



Net income per limited partner unit (h):

Common units - basic $ 0.60 $0.37 $1.16 $0.72

Common units - diluted 0.60 0.37 1.16 0.72



Weighted-average limited partner units outstanding (h):

Common units - basic 62,439,37860,279,28762,364,243 54,748,755

Common units - diluted 62,446,41960,364,34762,372,554 54,776,257



See Footnotes to Earnings Release Tables

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

KEY OPERATING AND FINANCIAL INFORMATION

(Unaudited, amounts in thousands except barrel and per unit data)

Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019

Transportation and Terminaling Segment

Terminals

Total throughput (barrels per day ("bpd")) (b)(d) 221,396 275,076 260,894 262,772

Lease tank capacity (average lease capacity barrels per month) (d) 2,392,535 2,185,882 2,221,789 2,300,813

Pipelines

Total throughput (bpd) (b)(d) 156,043 161,809 159,285 154,520

Lease tank capacity (average lease capacity barrels per month) (d) 1,163,287 1,500,714 1,155,555 1,338,769



Storage Segment

Storage capacity reserved (average shell capacity barrels per month) (d)7,607,643 8,053,983 7,607,643 7,993,338

Total throughput (bpd) (b)(d) 27,054 - 26,154 -



Cash Flow Information:

Net cash provided by (used in):

Operating activities $61,041 $ 17,677 $79,688 $ 55,886

Investing activities (1,792) (3,932) (7,872) (15,152)

Financing activities (153,704) (10,191) (85,214) (40,642)

Net change in cash and cash equivalents $(94,455) $ 3,554 $(13,398) $ 92



Other Financial Information:

EBITDA attributable to PBFX (c) $58,867 $ 42,534 $115,176 $ 79,356

Adjusted EBITDA (c) $60,002 $ 48,336 $117,940 $ 91,293

Distributable cash flow (c) $46,972 $ 34,123 $87,747 $ 59,536

Quarterly distribution declared per unit (e) $0.3000 $ 0.5150 $0.6000 $ 1.0250

Distributions (e):

Common units $18,849 $ 32,398 $37,693 $ 64,481

Total distributions $18,849 $ 32,398 $37,693 $ 64,481

Coverage ratio (c) 2.49x 1.05x 2.33x 0.92x

Capital expenditures $1,792 $ 3,932 $7,872 $ 15,152



See Footnotes to Earnings Release Tables

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

KEY OPERATING AND FINANCIAL INFORMATION (continued)

(Unaudited, in thousands)



June 30, December 31,

Balance Sheet 2020 2019 Information:

Cash and cash equivalents (f) $ 21,568 $34,966

Property, plant and equipment, 841,475 854,610 net

Total assets 950,543 973,002

Total debt (f) 768,085 802,104

Total liabilities 823,297 867,919

Partners' equity 127,246 105,083

Total liabilities and equity 950,543 973,002



See Footnotes to Earnings Release Tables

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

RECONCILIATION OF AMOUNTS REPORTED UNDER GAAP

TO EBITDA AND DISTRIBUTABLE CASH FLOW

(Unaudited, in thousands)

Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019

Reconciliation of net income to EBITDA and distributable cash flow (c):

Net income $37,460$25,328$72,273$47,404

Interest expense, net 11,536 11,216 23,385 22,129

Amortization of loan fees and debt premium 542 446 981 895

Accretion on discounted liabilities 580 773 1,132 1,533

Change in contingent consideration 324 - 530 -

Depreciation and amortization 11,234 8,854 22,516 17,575

EBITDA 61,676 46,617 120,817 89,536

Less: Noncontrolling interest EBITDA (g) - 4,083 - 10,180

Less: Earnings attributable to the CPI earn-out 2,809 - 5,641 -

EBITDA attributable to PBFX 58,867 42,534 115,176 79,356

Non-cash unit-based compensation expense 945 3,387 2,247 4,351

Cash interest (11,733)(11,290)(23,721)(22,426)

Maintenance capital expenditures attributable to PBFX (1,107) (508) (5,955) (1,745)

Distributable cash flow $46,972$34,123$87,747$59,536



Reconciliation of net cash provided by operating activities to EBITDA and distributable cash flow (c):

Net cash provided by operating activities $61,041$17,677$79,688$55,886

Change in operating assets and liabilities (9,956) 21,111 19,991 15,872

Interest expense, net 11,536 11,216 23,385 22,129

Non-cash unit-based compensation expense (945) (3,387) (2,247) (4,351)

EBITDA 61,676 46,617 120,817 89,536

Less: Noncontrolling interest EBITDA (g) - 4,083 - 10,180

Less: Earnings attributable to the CPI earn-out 2,809 - 5,641 -

EBITDA attributable to PBFX 58,867 42,534 115,176 79,356

Non-cash unit-based compensation expense 945 3,387 2,247 4,351

Cash interest (11,733)(11,290)(23,721)(22,426)

Maintenance capital expenditures attributable to PBFX (1,107) (508) (5,955) (1,745)

Distributable cash flow $46,972$34,123$87,747$59,536



See Footnotes to Earnings Release Tables

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

RECONCILIATION OF AMOUNTS REPORTED UNDER GAAP

TO EBITDA AND ADJUSTED EBITDA

(Unaudited, in thousands)

Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019

Reconciliation of net income to EBITDA and Adjusted EBITDA (c):

Net income $37,460$25,328$72,273 $47,404

Interest expense, net 11,536 11,216 23,385 22,129

Amortization of loan fees and debt premium 542 446 981 895

Accretion on discounted liabilities 580 773 1,132 1,533

Change in contingent consideration 324 - 530 -

Depreciation and amortization 11,234 8,854 22,516 17,575

EBITDA 61,676 46,617 120,817 89,536

Less: Noncontrolling interest EBITDA (g) - 4,083 - 10,180

Less: Earnings attributable to the CPI earn-out 2,809 - 5,641 -

EBITDA attributable to PBFX 58,867 42,534 115,176 79,356

Acquisition and transaction costs 15 955 110 3,108

Non-cash unit-based compensation expense 945 3,387 2,247 4,351

East Coast Terminals environmental remediation costs 175 1,460 407 3,596

PNGPC tariff true-up adjustment - - - 882

Adjusted EBITDA $60,002$48,336$117,940$91,293



See Footnotes to Earnings Release Tables

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

SEGMENT FINANCIAL INFORMATION

(Unaudited, in thousands)



Three Months Ended June 30, 2020

Transportation Consolidated and Storage Corporate Total Terminaling

Total revenue (a) $66,709 $22,420$ - $89,129

Depreciation and amortization7,023 4,211 - 11,234

Income (loss) from operations42,912 11,505 (4,299) 50,118

Other expense - - 12,658 12,658

Capital expenditures 1,405 387 - 1,792



Three Months Ended June 30, 2019

Transportation Consolidated and Storage Corporate Total Terminaling

Total revenue (a) $69,656 $13,094$ - $82,750

Depreciation and amortization6,879 1,975 - 8,854

Income (loss) from operations40,529 4,814 (7,580) 37,763

Other expense - - 12,435 12,435

Capital expenditures 1,689 2,243 - 3,932



Six Months Ended June 30, 2020

Transportation Consolidated and Storage Corporate Total Terminaling

Total revenue (a) $136,952 $45,206$ - $182,158

Depreciation and amortization14,095 8,421 - 22,516

Income (loss) from operations84,180 22,277 (8,686) 97,771

Other expense - - 25,498 25,498

Capital expenditures 5,031 2,841 - 7,872



Six Months Ended June 30, 2019

Transportation Consolidated and Storage Corporate Total Terminaling

Total revenue (a) $135,615 $25,980$ - $161,595

Depreciation and amortization13,780 3,795 - 17,575

Income (loss) from operations77,080 8,471 (13,590) 71,961

Other expense - - 24,557 24,557

Capital expenditures 12,233 2,919 - 15,152



See Footnotes to Earnings Release Tables

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

SEGMENT FINANCIAL INFORMATION (continued)

(Unaudited, in thousands)



Balance at June 30, 2020

Transportation Storage CorporateConsolidated and Terminaling Total

Total assets$ 710,817 $229,595$10,131$ 950,543



Balance at December 31, 2019

Transportation Storage CorporateConsolidated and Terminaling Total

Total assets$ 726,374 $228,495$18,133$ 973,002

PBF LOGISTICS LP

EARNINGS RELEASE TABLES

FOOTNOTES TO EARNINGS RELEASE TABLES

(Unaudited, in thousands, except per unit data)



See discussion of the factors affecting comparability noted on page 4. Our results of operations may not be comparable to the historical results of operations for the reasons described below: Revenue - On October 1, 2018, we closed the East Coast Storage Assets Acquisition, which was accounted for as a business combination. In October 2019, we recommenced operations of certain of the acquired idled assets, which began revenue generating activities. As such, there was no revenue associated with the acquired idled assets prior to their recommencement. On May 31, 2019, we closed the TVPC Acquisition in which we acquired the (a)remaining 50% equity interest in TVPC. As such, we now own 100% of the equity interest in TVPC and no longer record a noncontrolling interest related to our ownership of TVPC. Operating and maintenance expenses - As a result of our acquisitions and the completion of certain organic growth projects, our operating expenses are not comparative to prior periods as it pertains to expenses associated with those assets. In addition, our results in the current year have been negatively affected by the impact of the COVID-19 pandemic on our business, including lower throughput at our terminals, as the industry reacts to the related economic downturn and volatile commodity markets.



(b)Calculated as the sum of the average throughput per day for each asset group for the periods presented.



See "Non-GAAP Financial Measures" on page 5 for definitions of EBITDA, EBITDA (c)attributable to PBFX, Adjusted EBITDA, distributable cash flow and coverage ratio.



Operating information reflects activity subsequent to our acquisitions, the (d)execution of the commercial agreements with PBF Holding and the completion of certain organic growth projects.



On July 31, 2020, we announced a quarterly cash distribution of $0.30 per limited partner unit based on the results of the second quarter of 2020. The (e)distribution is payable on August 26, 2020 to PBFX unitholders of record at the close of business on August 13, 2020. The total distribution amount includes the expected distributions to be made related to second quarter earnings.



Management also utilizes net debt as a metric in assessing our leverage. Net debt is a non-GAAP measure calculated by subtracting cash and cash equivalents from total debt. We believe this measurement is also useful to investors since we have the ability to, and may decide to, use a portion of our cash and cash equivalents to retire or pay down our debt. This non-GAAP financial measure (f)should not be considered in isolation or as a substitute for analysis of our debt levels as reported under GAAP. Our definition of net debt may not be comparable to similarly titled measures of other partnerships, because it may be defined differently by other partnerships in our industry, thereby limiting its utility. Our net debt as of June 30, 2020 and December 31, 2019 was $746,517 and $767,138, respectively.



Prior to the TVPC Acquisition, our wholly-owned subsidiary, PBFX Operating Company LLC ("PBFX Op Co"), held a 50% controlling equity interest in TVPC, with the other 50% equity interest in TVPC owned by TVP Holding, a subsidiary of PBF Holding. PBFX Op Co was the sole managing member of TVPC. We, through our ownership of PBFX Op Co, consolidated the financial results of TVPC and recorded a noncontrolling interest for the economic interest in TVPC held by TVP Holding. Noncontrolling interest on the condensed consolidated statements (g)of operations included the portion of net income or loss attributable to the economic interest in TVPC held by TVP Holding. Noncontrolling interest on the condensed consolidated balance sheets included the portion of net assets of TVPC attributable to TVP Holding. . Subsequent to the TVPC Acquisition, we own 100% of the equity interest in TVPC and no longer record a noncontrolling interest related to TVPC.



We base our calculation of net income per limited partner unit on the (h)weighted-average number of limited partner units outstanding during the period and the amount of available cash that has been, or will be, distributed to the limited partners.

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SOURCE PBF Logistics LP