|
|
|
|
|
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
|
Delaware
|
|
35-1811116
|
(State or Other Jurisdiction of
Incorporation or Organization)
|
|
(I.R.S. Employer
Identification Number)
|
|
|
|
2780 Waterfront Parkway East Drive, Suite 200
|
|
|
Indianapolis, Indiana
|
|
46214
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
|
|
Large accelerated filer
|
|
☐
|
|
Accelerated filer
|
|
☒
|
Non-accelerated filer
|
|
☐
|
|
Smaller reporting company
|
|
☐
|
|
|
|
|
Emerging growth company
|
|
☐
|
Title of each class
|
|
Trading symbol(s)
|
|
Name of each exchange on which registered
|
Common units representing limited partner interests
|
|
CLMT
|
|
The NASDAQ Stock Market LLC
|
|
|
Page
|
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
|
(Unaudited)
|
|
|
||||
|
(In millions, except unit data)
|
||||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
173.5
|
|
|
$
|
155.7
|
|
Accounts receivable, net:
|
|
|
|
||||
Trade
|
232.0
|
|
|
177.7
|
|
||
Other
|
27.6
|
|
|
20.3
|
|
||
|
259.6
|
|
|
198.0
|
|
||
Inventories
|
285.1
|
|
|
284.1
|
|
||
Derivative assets
|
0.7
|
|
|
18.3
|
|
||
Prepaid expenses and other current assets
|
11.8
|
|
|
13.9
|
|
||
Total current assets
|
730.7
|
|
|
670.0
|
|
||
Property, plant and equipment, net
|
1,055.8
|
|
|
1,098.1
|
|
||
Investment in unconsolidated affiliates
|
9.3
|
|
|
25.4
|
|
||
Goodwill
|
171.4
|
|
|
171.4
|
|
||
Other intangible assets, net
|
79.6
|
|
|
88.0
|
|
||
Operating lease right-of-use assets
|
123.6
|
|
|
—
|
|
||
Other noncurrent assets, net
|
36.7
|
|
|
34.6
|
|
||
Total assets
|
$
|
2,207.1
|
|
|
$
|
2,087.5
|
|
LIABILITIES AND PARTNERS’ CAPITAL
|
|||||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
252.6
|
|
|
$
|
200.6
|
|
Accrued interest payable
|
29.6
|
|
|
30.7
|
|
||
Accrued salaries, wages and benefits
|
26.3
|
|
|
25.7
|
|
||
Other taxes payable
|
17.9
|
|
|
15.2
|
|
||
Obligations under inventory financing agreements
|
125.5
|
|
|
105.3
|
|
||
Other current liabilities
|
79.8
|
|
|
33.8
|
|
||
Current portion of operating lease liabilities
|
62.1
|
|
|
—
|
|
||
Current portion of long-term debt
|
2.0
|
|
|
3.8
|
|
||
Total current liabilities
|
595.8
|
|
|
415.1
|
|
||
Pension and postretirement benefit obligations
|
4.5
|
|
|
4.5
|
|
||
Other long-term liabilities
|
1.4
|
|
|
1.5
|
|
||
Long-term operating lease liabilities
|
62.5
|
|
|
—
|
|
||
Long-term debt, less current portion
|
1,475.8
|
|
|
1,600.7
|
|
||
Total liabilities
|
2,140.0
|
|
|
2,021.8
|
|
||
Commitments and contingencies
|
|
|
|
||||
Partners’ capital:
|
|
|
|
||||
Limited partners’ interest 77,554,244 units and 77,177,159 units issued and outstanding as of June 30, 2019 and December 31, 2018, respectively
|
61.7
|
|
|
61.6
|
|
||
General partner’s interest
|
12.9
|
|
|
12.8
|
|
||
Accumulated other comprehensive loss
|
(7.5
|
)
|
|
(8.7
|
)
|
||
Total partners’ capital
|
67.1
|
|
|
65.7
|
|
||
Total liabilities and partners’ capital
|
$
|
2,207.1
|
|
|
$
|
2,087.5
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In millions, except per unit and unit data)
|
||||||||||||||
Sales
|
$
|
896.9
|
|
|
$
|
945.5
|
|
|
$
|
1,748.2
|
|
|
$
|
1,696.0
|
|
Cost of sales
|
789.8
|
|
|
822.1
|
|
|
1,505.1
|
|
|
1,459.4
|
|
||||
Gross profit
|
107.1
|
|
|
123.4
|
|
|
243.1
|
|
|
236.6
|
|
||||
Operating costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Selling
|
14.3
|
|
|
10.6
|
|
|
27.6
|
|
|
25.3
|
|
||||
General and administrative
|
37.8
|
|
|
31.9
|
|
|
72.7
|
|
|
72.5
|
|
||||
Transportation
|
31.6
|
|
|
33.0
|
|
|
67.5
|
|
|
63.3
|
|
||||
Taxes other than income taxes
|
4.7
|
|
|
5.4
|
|
|
9.8
|
|
|
7.3
|
|
||||
Loss on impairment and disposal of assets
|
16.2
|
|
|
0.7
|
|
|
27.9
|
|
|
1.2
|
|
||||
Other operating income
|
(2.2
|
)
|
|
(1.8
|
)
|
|
(0.9
|
)
|
|
(17.9
|
)
|
||||
Operating income
|
4.7
|
|
|
43.6
|
|
|
38.5
|
|
|
84.9
|
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
(33.1
|
)
|
|
(37.5
|
)
|
|
(65.4
|
)
|
|
(82.7
|
)
|
||||
Gain (loss) from debt extinguishment
|
0.3
|
|
|
(58.2
|
)
|
|
0.7
|
|
|
(58.8
|
)
|
||||
Gain on derivative instruments
|
10.3
|
|
|
0.8
|
|
|
19.4
|
|
|
0.7
|
|
||||
Other
|
1.3
|
|
|
0.9
|
|
|
6.6
|
|
|
2.4
|
|
||||
Total other expense
|
(21.2
|
)
|
|
(94.0
|
)
|
|
(38.7
|
)
|
|
(138.4
|
)
|
||||
Net loss from continuing operations before income taxes
|
(16.5
|
)
|
|
(50.4
|
)
|
|
(0.2
|
)
|
|
(53.5
|
)
|
||||
Income tax expense from continuing operations
|
0.3
|
|
|
0.8
|
|
|
0.2
|
|
|
0.6
|
|
||||
Net loss from continuing operations
|
$
|
(16.8
|
)
|
|
$
|
(51.2
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(54.1
|
)
|
Net loss from discontinued operations, net of tax
|
$
|
—
|
|
|
$
|
(0.7
|
)
|
|
$
|
—
|
|
|
$
|
(2.6
|
)
|
Net loss
|
$
|
(16.8
|
)
|
|
$
|
(51.9
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(56.7
|
)
|
Allocation of net loss:
|
|
|
|
|
|
|
|
||||||||
Net loss
|
$
|
(16.8
|
)
|
|
$
|
(51.9
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(56.7
|
)
|
Less:
|
|
|
|
|
|
|
|
||||||||
General partner’s interest in net loss
|
(0.3
|
)
|
|
(1.0
|
)
|
|
—
|
|
|
(1.1
|
)
|
||||
Net loss available to limited partners
|
$
|
(16.5
|
)
|
|
$
|
(50.9
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(55.6
|
)
|
Weighted average limited partner units outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
|
78,212,837
|
|
|
77,730,458
|
|
|
78,111,857
|
|
|
77,644,262
|
|
||||
Limited partners’ interest basic and diluted net loss per unit:
|
|
|
|
|
|
|
|
||||||||
From continuing operations
|
$
|
(0.21
|
)
|
|
$
|
(0.64
|
)
|
|
$
|
—
|
|
|
$
|
(0.68
|
)
|
From discontinued operations
|
—
|
|
|
(0.01
|
)
|
|
—
|
|
|
(0.03
|
)
|
||||
Limited partners’ interest
|
$
|
(0.21
|
)
|
|
$
|
(0.65
|
)
|
|
$
|
—
|
|
|
$
|
(0.71
|
)
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In millions)
|
||||||||||||||
Net loss
|
$
|
(16.8
|
)
|
|
$
|
(51.9
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(56.7
|
)
|
Other comprehensive income:
|
|
|
|
|
|
|
|
||||||||
Cash flow hedges:
|
|
|
|
|
|
|
|
||||||||
Cash flow hedge loss reclassified to net loss
|
—
|
|
|
2.1
|
|
|
—
|
|
|
2.1
|
|
||||
Defined benefit pension and retiree health benefit plans
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
1.2
|
|
|
—
|
|
||||
Total other comprehensive income
|
—
|
|
|
2.2
|
|
|
1.2
|
|
|
2.2
|
|
||||
Comprehensive income (loss) attributable to partners’ capital
|
$
|
(16.8
|
)
|
|
$
|
(49.7
|
)
|
|
$
|
0.8
|
|
|
$
|
(54.5
|
)
|
|
Accumulated Other
Comprehensive Loss |
|
Partners’ Capital
|
|
|
||||||||||
|
|
General
Partner |
|
Limited
Partners |
|
Total
|
|||||||||
|
(In millions)
|
||||||||||||||
Balance at March 31, 2019
|
$
|
(7.5
|
)
|
|
$
|
13.2
|
|
|
$
|
77.8
|
|
|
$
|
83.5
|
|
Net loss
|
—
|
|
|
(0.3
|
)
|
|
(16.5
|
)
|
|
(16.8
|
)
|
||||
Amortization of phantom units
|
—
|
|
|
—
|
|
|
0.6
|
|
|
0.6
|
|
||||
Settlement of tax withholdings on equity-based incentive compensation
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|
(0.2
|
)
|
||||
Balance at June 30, 2019
|
$
|
(7.5
|
)
|
|
$
|
12.9
|
|
|
$
|
61.7
|
|
|
$
|
67.1
|
|
|
Accumulated Other
Comprehensive Loss
|
|
Partners’ Capital
|
|
|
||||||||||
|
|
General
Partner
|
|
Limited
Partners
|
|
Total
|
|||||||||
|
(In millions)
|
||||||||||||||
Balance at December 31, 2018
|
$
|
(8.7
|
)
|
|
$
|
12.8
|
|
|
$
|
61.6
|
|
|
$
|
65.7
|
|
Other comprehensive income
|
1.2
|
|
|
—
|
|
|
—
|
|
|
1.2
|
|
||||
Net loss
|
—
|
|
|
—
|
|
|
(0.4
|
)
|
|
(0.4
|
)
|
||||
Amortization of phantom units
|
—
|
|
|
—
|
|
|
1.0
|
|
|
1.0
|
|
||||
Settlement of tax withholdings on equity-based incentive compensation
|
—
|
|
|
—
|
|
|
(0.5
|
)
|
|
(0.5
|
)
|
||||
Contributions from Calumet GP, LLC
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
||||
Balance at June 30, 2019
|
$
|
(7.5
|
)
|
|
$
|
12.9
|
|
|
$
|
61.7
|
|
|
$
|
67.1
|
|
|
Accumulated Other
Comprehensive Loss |
|
Partners’ Capital
|
|
|
||||||||||
|
|
General
Partner |
|
Limited
Partners |
|
Total
|
|||||||||
|
(In millions)
|
||||||||||||||
Balance at March 31, 2018
|
$
|
(7.2
|
)
|
|
$
|
13.7
|
|
|
$
|
108.9
|
|
|
$
|
115.4
|
|
Other comprehensive income
|
2.2
|
|
|
—
|
|
|
—
|
|
|
2.2
|
|
||||
Net loss
|
—
|
|
|
(1.0
|
)
|
|
(50.9
|
)
|
|
(51.9
|
)
|
||||
Amortization of phantom units
|
—
|
|
|
—
|
|
|
1.3
|
|
|
1.3
|
|
||||
Settlement of tax withholdings on equity-based incentive compensation
|
—
|
|
|
—
|
|
|
(0.4
|
)
|
|
(0.4
|
)
|
||||
Balance at June 30, 2018
|
$
|
(5.0
|
)
|
|
$
|
12.7
|
|
|
$
|
58.9
|
|
|
$
|
66.6
|
|
|
Accumulated Other
Comprehensive Loss |
|
Partners’ Capital
|
|
|
||||||||||
|
|
General
Partner |
|
Limited
Partners |
|
Total
|
|||||||||
|
(In millions)
|
||||||||||||||
Balance at December 31, 2017
|
$
|
(7.2
|
)
|
|
$
|
13.8
|
|
|
$
|
113.3
|
|
|
$
|
119.9
|
|
Other comprehensive income
|
2.2
|
|
|
—
|
|
|
—
|
|
|
2.2
|
|
||||
Net loss
|
—
|
|
|
(1.1
|
)
|
|
(55.6
|
)
|
|
(56.7
|
)
|
||||
Amortization of phantom units
|
—
|
|
|
—
|
|
|
2.1
|
|
|
2.1
|
|
||||
Settlement of tax withholdings on equity-based incentive compensation
|
—
|
|
|
—
|
|
|
(0.9
|
)
|
|
(0.9
|
)
|
||||
Balance at June 30, 2018
|
$
|
(5.0
|
)
|
|
$
|
12.7
|
|
|
$
|
58.9
|
|
|
$
|
66.6
|
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Operating activities
|
|
|
|
||||
Net loss
|
$
|
(0.4
|
)
|
|
$
|
(56.7
|
)
|
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
|
|
|
||||
Net loss from discontinued operations
|
—
|
|
|
2.6
|
|
||
Depreciation and amortization
|
55.2
|
|
|
59.2
|
|
||
Amortization of turnaround costs
|
10.4
|
|
|
6.0
|
|
||
Non-cash interest expense
|
3.5
|
|
|
4.4
|
|
||
(Gain) loss on debt extinguishments
|
(0.7
|
)
|
|
58.8
|
|
||
Unrealized (gain) loss on derivative instruments
|
14.8
|
|
|
(2.8
|
)
|
||
Equity based compensation
|
4.6
|
|
|
3.0
|
|
||
Lower of cost or market inventory adjustment
|
(41.5
|
)
|
|
(15.0
|
)
|
||
Loss on impairment and disposal of assets
|
27.9
|
|
|
1.2
|
|
||
Operating lease expense
|
37.8
|
|
|
—
|
|
||
Operating lease payments
|
(37.4
|
)
|
|
—
|
|
||
Other non-cash activities
|
(3.6
|
)
|
|
(1.0
|
)
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(66.6
|
)
|
|
19.5
|
|
||
Inventories
|
40.5
|
|
|
(2.6
|
)
|
||
Prepaid expenses and other current assets
|
6.0
|
|
|
2.2
|
|
||
Derivative activity
|
(0.3
|
)
|
|
(0.3
|
)
|
||
Turnaround costs
|
(6.4
|
)
|
|
(7.6
|
)
|
||
Other assets
|
0.1
|
|
|
—
|
|
||
Accounts payable
|
42.9
|
|
|
(17.7
|
)
|
||
Accrued interest payable
|
(0.5
|
)
|
|
(20.3
|
)
|
||
Accrued salaries, wages and benefits
|
(3.0
|
)
|
|
(6.7
|
)
|
||
Other taxes payable
|
2.7
|
|
|
5.2
|
|
||
Other liabilities
|
3.6
|
|
|
(54.7
|
)
|
||
Net cash provided by (used in) operating activities
|
89.6
|
|
|
(23.3
|
)
|
||
Investing activities
|
|
|
|
||||
Additions to property, plant and equipment
|
(17.1
|
)
|
|
(33.3
|
)
|
||
Investment in unconsolidated affiliate
|
—
|
|
|
(3.8
|
)
|
||
Proceeds from sale of unconsolidated affiliate
|
5.0
|
|
|
9.9
|
|
||
Proceeds from sale of business, net
|
—
|
|
|
28.4
|
|
||
Proceeds from sale of property, plant and equipment
|
3.7
|
|
|
0.2
|
|
||
Net cash provided by discontinued investing activities
|
5.0
|
|
|
3.4
|
|
||
Net cash provided by (used in) investing activities
|
(3.4
|
)
|
|
4.8
|
|
||
Financing activities
|
|
|
|
||||
Proceeds from borrowings — revolving credit facility
|
—
|
|
|
141.0
|
|
||
Repayments of borrowings — revolving credit facility
|
—
|
|
|
(141.1
|
)
|
||
Repayments of borrowings — senior notes
|
(88.6
|
)
|
|
(400.0
|
)
|
||
Payments on finance lease obligations
|
(0.7
|
)
|
|
(1.8
|
)
|
||
Proceeds from inventory financing agreements
|
569.7
|
|
|
529.6
|
|
||
Payments on inventory financing agreements
|
(547.7
|
)
|
|
(533.6
|
)
|
||
Proceeds from other financing obligations
|
—
|
|
|
—
|
|
||
Payments on other financing obligations
|
(1.2
|
)
|
|
(1.6
|
)
|
||
Payments on extinguishment of debt
|
—
|
|
|
(46.6
|
)
|
||
Debt issuance costs
|
—
|
|
|
(2.9
|
)
|
||
Contributions from Calumet GP, LLC
|
0.1
|
|
|
—
|
|
||
Net cash used in financing activities
|
(68.4
|
)
|
|
(457.0
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
17.8
|
|
|
(475.5
|
)
|
||
Cash and cash equivalents at beginning of period
|
155.7
|
|
|
514.3
|
|
||
Cash and cash equivalents at end of period
|
$
|
173.5
|
|
|
$
|
38.8
|
|
Cash and cash equivalents
|
$
|
173.5
|
|
|
$
|
38.8
|
|
Supplemental disclosure of non-cash investing activities
|
|
|
|
||||
Non-cash property, plant and equipment additions
|
$
|
5.6
|
|
|
$
|
2.5
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
RINs Obligation
|
$
|
22.3
|
|
|
$
|
15.8
|
|
Other (1)
|
57.5
|
|
|
18.0
|
|
||
Total
|
$
|
79.8
|
|
|
$
|
33.8
|
|
|
(1)
|
Balance as of June 30, 2019 includes $38.1 million related to the reclassification of the present value of the TexStar finance lease obligation in the first quarter of 2019 from current and long-term debt to other current liabilities. See Note 7 - “Commitments and Contingencies” for further information.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Sales by major source
|
|
|
|
|
|
|
|
||||||||
Standard specialty products
|
$
|
283.7
|
|
|
$
|
309.7
|
|
|
$
|
576.0
|
|
|
$
|
563.5
|
|
Packaged and synthetic specialty products
|
60.7
|
|
|
72.9
|
|
|
120.6
|
|
|
140.9
|
|
||||
Total specialty products
|
$
|
344.4
|
|
|
$
|
382.6
|
|
|
$
|
696.6
|
|
|
$
|
704.4
|
|
|
|
|
|
|
|
|
|
||||||||
Fuel and fuel related products
|
$
|
495.0
|
|
|
$
|
500.8
|
|
|
$
|
937.9
|
|
|
$
|
896.3
|
|
Asphalt
|
57.5
|
|
|
62.1
|
|
|
113.7
|
|
|
95.3
|
|
||||
Total fuel products
|
$
|
552.5
|
|
|
$
|
562.9
|
|
|
$
|
1,051.6
|
|
|
$
|
991.6
|
|
|
|
|
|
|
|
|
|
||||||||
Total sales
|
$
|
896.9
|
|
|
$
|
945.5
|
|
|
$
|
1,748.2
|
|
|
$
|
1,696.0
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Titled
Inventory
|
|
Supply and Offtake
Agreements (1)
|
|
Total
|
|
Titled
Inventory
|
|
Supply and Offtake
Agreements (1)
|
|
Total
|
||||||||||||
Raw materials
|
$
|
38.2
|
|
|
$
|
12.8
|
|
|
$
|
51.0
|
|
|
$
|
41.8
|
|
|
$
|
10.6
|
|
|
$
|
52.4
|
|
Work in process
|
37.5
|
|
|
32.2
|
|
|
69.7
|
|
|
40.7
|
|
|
19.2
|
|
|
59.9
|
|
||||||
Finished goods
|
111.5
|
|
|
52.9
|
|
|
164.4
|
|
|
127.9
|
|
|
43.9
|
|
|
171.8
|
|
||||||
|
$
|
187.2
|
|
|
$
|
97.9
|
|
|
$
|
285.1
|
|
|
$
|
210.4
|
|
|
$
|
73.7
|
|
|
$
|
284.1
|
|
|
(1)
|
Amounts represent LIFO value and do not necessarily represent the value of product financing. Refer to Note 8 - “Inventory Financing Agreements” for further information.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||
|
2018
|
||||||
Other
|
(0.7
|
)
|
|
(2.6
|
)
|
||
Net loss from discontinued operations net of income taxes
|
$
|
(0.7
|
)
|
|
$
|
(2.6
|
)
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
|
Investment
|
|
Investment
|
||||
Fluid Holding Corp.
|
9.3
|
|
|
25.4
|
|
||
Total
|
$
|
9.3
|
|
|
$
|
25.4
|
|
Facility/ Refinery
|
|
Union
|
|
Expiration Date
|
Cotton Valley
|
|
International Union of Operating Engineers
|
|
January 15, 2023
|
Shreveport
|
|
United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied-Industrial and Service Workers International Union
|
|
April 30, 2022
|
Missouri
|
|
United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied-Industrial and Service Workers International Union
|
|
April 30, 2022
|
Great Falls
|
|
United Steel, Paper and Forestry, Rubber, Manufacturing, Energy Allied-Industrial and Service Workers International Union
|
|
July 31, 2022
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Borrowings under third amended and restated senior secured revolving credit agreement with third-party lenders, interest payments quarterly, borrowings due February 2023, weighted average interest rate of 0.1% and 6.0% for the six months ended June 30, 2019 and year ended December 31, 2018, respectively.
|
$
|
—
|
|
|
$
|
—
|
|
Borrowings under 2021 Notes, interest at a fixed rate of 6.5%, interest payments semiannually, borrowings due April 2021, effective interest rate of 6.7% and 6.8% for the six months ended June 30, 2019 and the year ended December 31, 2018, respectively.
|
810.2
|
|
|
900.0
|
|
||
Borrowings under 2022 Notes, interest at a fixed rate of 7.625%, interest payments semiannually, borrowings due January 2022, effective interest rate of 8.1% and 8.0% for the six months ended June 30, 2019 and the year ended December 31, 2018, respectively. (1)
|
351.4
|
|
|
351.6
|
|
||
Borrowings under 2023 Notes, interest at a fixed rate of 7.75%, interest payments semiannually, borrowings due April 2023, effective interest rate of 8.0% for each the six months ended June 30, 2019 and the year ended December 31, 2018.
|
325.0
|
|
|
325.0
|
|
||
Other
|
4.5
|
|
|
5.2
|
|
||
Finance lease obligations, at various interest rates, interest and monthly principal payments (3)
|
3.0
|
|
|
42.4
|
|
||
Less unamortized debt issuance costs (2)
|
(13.0
|
)
|
|
(15.8
|
)
|
||
Less unamortized discounts
|
(3.3
|
)
|
|
(3.9
|
)
|
||
Total long-term debt
|
$
|
1,477.8
|
|
|
$
|
1,604.5
|
|
Less current portion of long-term debt
|
2.0
|
|
|
3.8
|
|
||
|
$
|
1,475.8
|
|
|
$
|
1,600.7
|
|
|
(1)
|
The balance includes a fair value interest rate hedge adjustment, which increased the debt balance by $1.4 million and $1.6 million as of June 30, 2019 and December 31, 2018, respectively.
|
(2)
|
Deferred debt issuance costs are being amortized by the effective interest rate method over the lives of the related debt instruments. These amounts are net of accumulated amortization of $26.3 million and $23.5 million at June 30, 2019 and December 31, 2018, respectively.
|
(3)
|
In the first quarter of 2019, the Company reclassified its TexStar finance lease obligation from debt to other current liabilities on the condensed consolidated balance sheets. See Note 7 - “Commitments and Contingencies” for further information.
|
|
|
Base Loans
|
|
FILO Loans
|
||||
Quarterly Average Availability Percentage
|
|
Prime Rate Margin
|
|
LIBOR Rate Margin
|
|
Prime Rate Margin
|
|
LIBOR Rate Margin
|
≥ 66%
|
|
0.50%
|
|
1.50%
|
|
1.50%
|
|
2.50%
|
≥ 33% and < 66%
|
|
0.75%
|
|
1.75%
|
|
1.75%
|
|
2.75%
|
< 33%
|
|
1.00%
|
|
2.00%
|
|
2.00%
|
|
3.00%
|
Year
|
Maturity
|
||
2019
|
$
|
1.0
|
|
2020
|
1.8
|
|
|
2021
|
812.8
|
|
|
2022
|
350.3
|
|
|
2023
|
325.4
|
|
|
Thereafter
|
1.4
|
|
|
Total
|
$
|
1,492.7
|
|
•
|
crude oil purchases and sales;
|
•
|
fuel product sales and purchases;
|
•
|
natural gas purchases;
|
•
|
precious metals purchases; and
|
•
|
fluctuations in the value of crude oil between geographic regions and between the different types of crude oil such as New York Mercantile Exchange West Texas Intermediate (“NYMEX WTI”), Light Louisiana Sweet, Western Canadian Select (“WCS”), WTI Midland, Mixed Sweet Blend and ICE Brent.
|
|
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
|
Balance Sheet Location
|
|
Gross Amounts of Recognized Liabilities
|
|
Gross Amounts Offset in the Condensed Consolidated Balance Sheets
|
|
Net Amounts of Liabilities Presented
in the Condensed Consolidated Balance Sheets
|
|
Gross Amounts of Recognized Liabilities
|
|
Gross Amounts Offset in the Condensed Consolidated Balance Sheets
|
|
Net Amounts of Liabilities Presented
in the Condensed Consolidated Balance Sheets
|
||||||||||||
Derivative instruments not designated as hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Fuel products segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
WCS crude oil basis swaps
|
|
Derivative liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.6
|
)
|
|
1.6
|
|
|
—
|
|
||||||
WCS crude oil percentage basis swaps
|
|
Derivative liabilities
|
|
(2.7
|
)
|
|
2.7
|
|
|
—
|
|
|
(6.1
|
)
|
|
6.1
|
|
|
—
|
|
||||||
Diesel percentage basis crack spread swaps
|
|
Derivative liabilities
|
|
(0.4
|
)
|
|
0.4
|
|
|
—
|
|
|
(6.0
|
)
|
|
6.0
|
|
|
—
|
|
||||||
Total derivative instruments
|
|
|
|
$
|
(3.1
|
)
|
|
$
|
3.1
|
|
|
$
|
—
|
|
|
$
|
(13.7
|
)
|
|
$
|
13.7
|
|
|
$
|
—
|
|
WCS Crude Oil Basis Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
First Quarter 2019
|
419,000
|
|
|
4,656
|
|
|
$
|
(28.10
|
)
|
Second Quarter 2019
|
455,000
|
|
|
5,000
|
|
|
$
|
(28.22
|
)
|
Third Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
$
|
(28.22
|
)
|
Fourth Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
$
|
(28.22
|
)
|
Total
|
1,794,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
(28.19
|
)
|
WCS Crude Oil Basis Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
First Quarter 2019
|
388,000
|
|
|
4,311
|
|
|
$
|
(19.84
|
)
|
Second Quarter 2019
|
455,000
|
|
|
5,000
|
|
|
$
|
(19.84
|
)
|
Third Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
$
|
(19.84
|
)
|
Fourth Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
$
|
(19.84
|
)
|
Total
|
1,763,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
(19.84
|
)
|
WCS Crude Oil Percentage Basis Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Fixed Percentage of NYMEX WTI
(Average % of WTI/Bbl) |
|||
Third Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
66.32
|
%
|
Fourth Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
66.32
|
%
|
Total
|
920,000
|
|
|
|
|
|
||
Average percentage
|
|
|
|
|
66.32
|
%
|
WCS Crude Oil Percentage Basis Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Fixed Percentage of NYMEX WTI
(Average % of WTI/Bbl) |
|||
Third Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
67.05
|
%
|
Fourth Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
66.16
|
%
|
Total
|
920,000
|
|
|
|
|
|
||
Average percentage
|
|
|
|
|
66.61
|
%
|
WCS Crude Oil Percentage Basis Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Fixed Percentage of NYMEX WTI
(Average % of WTI/Bbl) |
|||
First Quarter 2019
|
450,000
|
|
|
5,000
|
|
|
66.32
|
%
|
Second Quarter 2019
|
455,000
|
|
|
5,000
|
|
|
66.32
|
%
|
Third Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
66.32
|
%
|
Fourth Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
66.32
|
%
|
Total
|
1,825,000
|
|
|
|
|
|
||
Average percentage
|
|
|
|
|
66.32
|
%
|
Midland Crude Oil Basis Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
First Quarter 2019
|
501,500
|
|
|
5,572
|
|
|
$
|
(12.79
|
)
|
Second Quarter 2019
|
773,500
|
|
|
8,500
|
|
|
$
|
(11.74
|
)
|
Total
|
1,275,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
(12.27
|
)
|
Diesel Crack Spread Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
First Quarter 2019
|
450,000
|
|
|
5,000
|
|
|
$
|
25.58
|
|
Second Quarter 2019
|
455,000
|
|
|
5,000
|
|
|
$
|
25.58
|
|
Third Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
$
|
25.58
|
|
Fourth Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
$
|
25.58
|
|
Total
|
1,825,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
25.58
|
|
Diesel Percentage Basis Crack Spread Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Fixed Percentage of NYMEX WTI
(Average % of WTI/Bbl) |
|||
Third Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
138.38
|
%
|
Fourth Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
138.38
|
%
|
Total
|
920,000
|
|
|
|
|
|
||
Average percentage
|
|
|
|
|
138.38
|
%
|
Diesel Percentage Basis Crack Spread Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Fixed Percentage of NYMEX WTI
(Average % of WTI/Bbl) |
|||
Third Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
137.37
|
%
|
Fourth Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
137.37
|
%
|
Total
|
920,000
|
|
|
|
|
|
||
Average percentage
|
|
|
|
|
137.37
|
%
|
Diesel Percentage Basis Crack Spread Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Fixed Percentage of NYMEX WTI
(Average % of WTI/Bbl) |
|||
First Quarter 2019
|
450,000
|
|
|
5,000
|
|
|
138.38
|
%
|
Second Quarter 2019
|
455,000
|
|
|
5,000
|
|
|
138.38
|
%
|
Third Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
138.38
|
%
|
Fourth Quarter 2019
|
460,000
|
|
|
5,000
|
|
|
138.38
|
%
|
Total
|
1,825,000
|
|
|
|
|
|
||
Average percentage
|
|
|
|
|
138.38
|
%
|
•
|
Level 1 — inputs include observable unadjusted quoted prices in active markets for identical assets or liabilities
|
•
|
Level 2 — inputs include other than quoted prices in active markets that are either directly or indirectly observable
|
•
|
Level 3 — inputs include unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivative assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Inventory financing obligation
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4.3
|
|
|
$
|
4.3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1.5
|
|
|
$
|
1.5
|
|
Diesel crack spread swaps
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7.4
|
|
|
7.4
|
|
||||||||
Diesel percentage basis crack spread swaps
|
—
|
|
|
—
|
|
|
0.5
|
|
|
0.5
|
|
|
—
|
|
|
—
|
|
|
(6.0
|
)
|
|
(6.0
|
)
|
||||||||
WCS crude oil basis swaps
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14.9
|
|
|
14.9
|
|
||||||||
WCS crude oil percentage basis swaps
|
—
|
|
|
—
|
|
|
0.2
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
(6.1
|
)
|
|
(6.1
|
)
|
||||||||
Midland crude oil basis swaps
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.1
|
|
|
8.1
|
|
||||||||
Total derivative assets
|
—
|
|
|
—
|
|
|
5.0
|
|
|
5.0
|
|
|
—
|
|
|
—
|
|
|
19.8
|
|
|
19.8
|
|
||||||||
Pension plan investments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
||||||||
Total recurring assets at fair value
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5.0
|
|
|
$
|
5.0
|
|
|
$
|
0.1
|
|
|
$
|
—
|
|
|
$
|
19.8
|
|
|
$
|
19.9
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
RINs Obligation
|
—
|
|
|
(22.3
|
)
|
|
—
|
|
|
(22.3
|
)
|
|
—
|
|
|
(15.8
|
)
|
|
—
|
|
|
(15.8
|
)
|
||||||||
Liability Awards
|
(7.2
|
)
|
|
—
|
|
|
—
|
|
|
(7.2
|
)
|
|
(2.7
|
)
|
|
—
|
|
|
—
|
|
|
(2.7
|
)
|
||||||||
Total recurring liabilities at fair value
|
$
|
(7.2
|
)
|
|
$
|
(22.3
|
)
|
|
$
|
—
|
|
|
$
|
(29.5
|
)
|
|
$
|
(2.7
|
)
|
|
$
|
(15.8
|
)
|
|
$
|
—
|
|
|
$
|
(18.5
|
)
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
Fair value at January 1,
|
$
|
19.8
|
|
|
$
|
(10.4
|
)
|
Realized (gain) loss on derivative instruments
|
(34.2
|
)
|
|
2.1
|
|
||
Unrealized gain (loss) on derivative instruments
|
(14.8
|
)
|
|
2.8
|
|
||
Settlements
|
34.2
|
|
|
(2.1
|
)
|
||
Fair value at June 30,
|
$
|
5.0
|
|
|
$
|
(7.6
|
)
|
Total gain (loss) included in net loss attributable to changes in unrealized gain (loss) relating to financial assets and liabilities held as of June 30, 2019
|
$
|
(14.8
|
)
|
|
$
|
2.8
|
|
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
Level
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
||||||||
Financial Instrument:
|
|
|
|
|
|
|
|
|
|
||||||||
Senior notes
|
1
|
|
$
|
1,461.3
|
|
|
$
|
1,473.7
|
|
|
$
|
1,287.4
|
|
|
$
|
1,560.7
|
|
Finance lease and other obligations
|
3
|
|
$
|
7.5
|
|
|
$
|
7.5
|
|
|
$
|
47.6
|
|
|
$
|
47.6
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Numerator for basic and diluted earnings per limited partner unit:
|
|
|
|
|
|
|
|
||||||||
Net loss from continuing operations
|
$
|
(16.8
|
)
|
|
$
|
(51.2
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(54.1
|
)
|
Less:
|
|
|
|
|
|
|
|
||||||||
General partner’s interest in net loss from continuing operations
|
(0.3
|
)
|
|
(1.0
|
)
|
|
—
|
|
|
(1.1
|
)
|
||||
Net loss from continuing operations available to limited partners
|
$
|
(16.5
|
)
|
|
$
|
(50.2
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(53.0
|
)
|
Net loss from discontinued operations available to limited partners
|
—
|
|
|
(0.7
|
)
|
|
—
|
|
|
(2.6
|
)
|
||||
Net loss available to limited partners
|
$
|
(16.5
|
)
|
|
$
|
(50.9
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(55.6
|
)
|
|
|
|
|
|
|
|
|
||||||||
Denominator for basic and diluted earnings per limited partner unit:
|
|
|
|
|
|
|
|
||||||||
Weighted average limited partner units outstanding(1)
|
78,212,837
|
|
|
77,730,458
|
|
|
78,111,857
|
|
|
77,644,262
|
|
||||
Limited partners’ interest basic and diluted net loss per unit:
|
|
|
|
|
|
|
|
||||||||
From continuing operations
|
$
|
(0.21
|
)
|
|
$
|
(0.64
|
)
|
|
$
|
—
|
|
|
$
|
(0.68
|
)
|
From discontinued operations
|
—
|
|
|
(0.01
|
)
|
|
—
|
|
|
(0.03
|
)
|
||||
Limited partners’ interest
|
$
|
(0.21
|
)
|
|
$
|
(0.65
|
)
|
|
$
|
—
|
|
|
$
|
(0.71
|
)
|
|
(1)
|
Total diluted weighted average limited partner units outstanding excludes 0.1 million for the three and six months ended June 30, 2019 and 0.3 million for the three and six months ended June 30, 2018, consisting of unvested phantom units.
|
•
|
Specialty Products. The specialty products segment is the Company’s core business which produces a variety of lubricating oils, solvents, waxes, synthetic lubricants and other products which are sold to customers who purchase these products primarily as raw material components for basic automotive, industrial and consumer goods. Specialty products also include synthetic lubricants used in manufacturing, mining and automotive applications.
|
•
|
Fuel Products. The fuel products segment produces primarily gasoline, diesel, jet fuel, asphalt and other products which are primarily sold to customers located in the PADD 2 and PADD 4 areas within the U.S.
|
Three Months Ended June 30, 2019
|
Specialty
Products
|
|
Fuel
Products
|
|
Combined
Segments
|
|
Eliminations
|
|
Consolidated
Total
|
||||||||||
Sales:
|
|
|
|
|
|
|
|
|
|
||||||||||
External customers
|
$
|
344.4
|
|
|
$
|
552.5
|
|
|
$
|
896.9
|
|
|
$
|
—
|
|
|
$
|
896.9
|
|
Intersegment sales
|
—
|
|
|
1.4
|
|
|
1.4
|
|
|
(1.4
|
)
|
|
—
|
|
|||||
Total sales
|
$
|
344.4
|
|
|
$
|
553.9
|
|
|
$
|
898.3
|
|
|
$
|
(1.4
|
)
|
|
$
|
896.9
|
|
Adjusted EBITDA
|
$
|
47.3
|
|
|
$
|
32.3
|
|
|
$
|
79.6
|
|
|
$
|
—
|
|
|
$
|
79.6
|
|
Reconciling items to net loss:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
12.7
|
|
|
19.9
|
|
|
32.6
|
|
|
—
|
|
|
32.6
|
|
|||||
Unrealized loss on derivatives
|
|
|
|
|
|
|
|
|
12.2
|
|
|||||||||
Interest expense
|
|
|
|
|
|
|
|
|
33.1
|
|
|||||||||
Gain on debt extinguishment
|
|
|
|
|
|
|
|
|
(0.3
|
)
|
|||||||||
Loss on impairment and disposal of fixed assets
|
|
|
|
|
|
|
|
|
16.2
|
|
|||||||||
Equity based compensation and other items
|
|
|
|
|
|
|
|
|
2.3
|
|
|||||||||
Income tax expense
|
|
|
|
|
|
|
|
|
0.3
|
|
|||||||||
Net loss from continuing operations
|
|
|
|
|
|
|
|
|
$
|
(16.8
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Three Months Ended June 30, 2018
|
Specialty
Products
|
|
Fuel
Products
|
|
Combined
Segments
|
|
Eliminations
|
|
Consolidated
Total
|
||||||||||
Sales:
|
|
|
|
|
|
|
|
|
|
||||||||||
External customers
|
$
|
382.6
|
|
|
$
|
562.9
|
|
|
$
|
945.5
|
|
|
$
|
—
|
|
|
$
|
945.5
|
|
Intersegment sales
|
—
|
|
|
16.1
|
|
|
16.1
|
|
|
(16.1
|
)
|
|
—
|
|
|||||
Total sales
|
$
|
382.6
|
|
|
$
|
579.0
|
|
|
$
|
961.6
|
|
|
$
|
(16.1
|
)
|
|
$
|
945.5
|
|
Adjusted EBITDA
|
$
|
53.7
|
|
|
$
|
25.6
|
|
|
$
|
79.3
|
|
|
$
|
—
|
|
|
$
|
79.3
|
|
Reconciling items to net loss:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
12.7
|
|
|
19.5
|
|
|
32.2
|
|
|
—
|
|
|
32.2
|
|
|||||
Realized loss on derivatives, not reflected in net loss or settled in a prior period
|
0.4
|
|
|
1.7
|
|
|
2.1
|
|
|
—
|
|
|
2.1
|
|
|||||
Unrealized gain on derivatives
|
|
|
|
|
|
|
|
|
(0.8
|
)
|
|||||||||
Interest expense
|
|
|
|
|
|
|
|
|
37.5
|
|
|||||||||
Loss on debt extinguishment
|
|
|
|
|
|
|
|
|
58.2
|
|
|||||||||
Loss on impairment and disposal of fixed assets
|
|
|
|
|
|
|
|
|
0.7
|
|
|||||||||
Equity based compensation and other items
|
|
|
|
|
|
|
|
|
(0.2
|
)
|
|||||||||
Income tax expense
|
|
|
|
|
|
|
|
|
0.8
|
|
|||||||||
Net loss from continuing operations
|
|
|
|
|
|
|
|
|
$
|
(51.2
|
)
|
Six Months Ended June 30, 2019
|
Specialty
Products
|
|
Fuel
Products
|
|
Combined
Segments
|
|
Eliminations
|
|
Consolidated
Total
|
||||||||||
Sales:
|
|
|
|
|
|
|
|
|
|
||||||||||
External customers
|
$
|
696.6
|
|
|
$
|
1,051.6
|
|
|
$
|
1,748.2
|
|
|
$
|
—
|
|
|
$
|
1,748.2
|
|
Intersegment sales
|
—
|
|
|
12.4
|
|
|
12.4
|
|
|
(12.4
|
)
|
|
—
|
|
|||||
Total sales
|
$
|
696.6
|
|
|
$
|
1,064.0
|
|
|
$
|
1,760.6
|
|
|
$
|
(12.4
|
)
|
|
$
|
1,748.2
|
|
Income from unconsolidated affiliates
|
$
|
3.8
|
|
|
$
|
—
|
|
|
$
|
3.8
|
|
|
$
|
—
|
|
|
$
|
3.8
|
|
Adjusted EBITDA
|
$
|
103.6
|
|
|
$
|
73.7
|
|
|
$
|
177.3
|
|
|
$
|
—
|
|
|
$
|
177.3
|
|
Reconciling items to net loss:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
24.9
|
|
|
40.7
|
|
|
65.6
|
|
|
—
|
|
|
65.6
|
|
|||||
Gain on sale of unconsolidated affiliate
|
(1.2
|
)
|
|
—
|
|
|
(1.2
|
)
|
|
—
|
|
|
(1.2
|
)
|
|||||
Unrealized loss on derivatives
|
|
|
|
|
|
|
|
|
14.8
|
|
|||||||||
Interest expense
|
|
|
|
|
|
|
|
|
65.4
|
|
|||||||||
Gain on debt extinguishment
|
|
|
|
|
|
|
|
|
(0.7
|
)
|
|||||||||
Loss on impairment and disposal of fixed assets
|
|
|
|
|
|
|
|
|
27.9
|
|
|||||||||
Equity based compensation and other items
|
|
|
|
|
|
|
|
|
5.7
|
|
|||||||||
Income tax expense
|
|
|
|
|
|
|
|
|
0.2
|
|
|||||||||
Net loss from continuing operations
|
|
|
|
|
|
|
|
|
$
|
(0.4
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Six Months Ended June 30, 2018
|
Specialty
Products
|
|
Fuel
Products
|
|
Combined
Segments
|
|
Eliminations
|
|
Consolidated
Total
|
||||||||||
Sales:
|
|
|
|
|
|
|
|
|
|
||||||||||
External customers
|
$
|
704.4
|
|
|
$
|
991.6
|
|
|
$
|
1,696.0
|
|
|
$
|
—
|
|
|
$
|
1,696.0
|
|
Intersegment sales
|
—
|
|
|
25.9
|
|
|
25.9
|
|
|
(25.9
|
)
|
|
—
|
|
|||||
Total sales
|
$
|
704.4
|
|
|
$
|
1,017.5
|
|
|
$
|
1,721.9
|
|
|
$
|
(25.9
|
)
|
|
$
|
1,696.0
|
|
Loss from unconsolidated affiliates
|
$
|
(3.7
|
)
|
|
$
|
—
|
|
|
$
|
(3.7
|
)
|
|
$
|
—
|
|
|
$
|
(3.7
|
)
|
Adjusted EBITDA
|
$
|
91.4
|
|
|
$
|
64.3
|
|
|
$
|
155.7
|
|
|
$
|
—
|
|
|
$
|
155.7
|
|
Reconciling items to net loss:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Depreciation and amortization
|
27.0
|
|
|
38.2
|
|
|
$
|
65.2
|
|
|
—
|
|
|
65.2
|
|
||||
Realized loss on derivatives, not reflected in net loss or settled in a prior period
|
0.4
|
|
|
1.7
|
|
|
$
|
2.1
|
|
|
—
|
|
|
2.1
|
|
||||
Unrealized gain on derivatives
|
|
|
|
|
|
|
|
|
(2.8
|
)
|
|||||||||
Interest expense
|
|
|
|
|
|
|
|
|
82.7
|
|
|||||||||
Loss on debt extinguishment
|
|
|
|
|
|
|
|
|
58.8
|
|
|||||||||
Loss on impairment and disposal of assets
|
|
|
|
|
|
|
|
|
1.2
|
|
|||||||||
Equity based compensation and other items
|
|
|
|
|
|
|
|
|
2.0
|
|
|||||||||
Income tax expense
|
|
|
|
|
|
|
|
|
0.6
|
|
|||||||||
Net loss from continuing operations
|
|
|
|
|
|
|
|
|
$
|
(54.1
|
)
|
|
Three Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
||||||||||
Specialty products:
|
|
|
|
|
|
|
|
||||||
Lubricating oils
|
$
|
152.5
|
|
|
17.0
|
%
|
|
$
|
165.5
|
|
|
17.5
|
%
|
Solvents
|
80.7
|
|
|
9.0
|
%
|
|
94.0
|
|
|
9.9
|
%
|
||
Waxes
|
31.6
|
|
|
3.5
|
%
|
|
28.1
|
|
|
3.0
|
%
|
||
Packaged and synthetic specialty products
|
60.7
|
|
|
6.8
|
%
|
|
72.9
|
|
|
7.7
|
%
|
||
Other
|
18.9
|
|
|
2.1
|
%
|
|
22.1
|
|
|
2.3
|
%
|
||
Total
|
$
|
344.4
|
|
|
38.4
|
%
|
|
$
|
382.6
|
|
|
40.5
|
%
|
Fuel products:
|
|
|
|
|
|
|
|
||||||
Gasoline
|
$
|
183.8
|
|
|
20.5
|
%
|
|
$
|
187.8
|
|
|
19.9
|
%
|
Diesel
|
218.1
|
|
|
24.3
|
%
|
|
250.7
|
|
|
26.5
|
%
|
||
Jet fuel
|
40.7
|
|
|
4.5
|
%
|
|
20.9
|
|
|
2.2
|
%
|
||
Asphalt, heavy fuel oils and other
|
109.9
|
|
|
12.3
|
%
|
|
103.5
|
|
|
10.9
|
%
|
||
Total
|
$
|
552.5
|
|
|
61.6
|
%
|
|
$
|
562.9
|
|
|
59.5
|
%
|
Consolidated sales
|
$
|
896.9
|
|
|
100.0
|
%
|
|
$
|
945.5
|
|
|
100.0
|
%
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
||||||||||
Specialty products:
|
|
|
|
|
|
|
|
||||||
Lubricating oils
|
$
|
304.6
|
|
|
17.4
|
%
|
|
$
|
301.7
|
|
|
17.8
|
%
|
Solvents
|
168.1
|
|
|
9.6
|
%
|
|
166.0
|
|
|
9.8
|
%
|
||
Waxes
|
62.5
|
|
|
3.6
|
%
|
|
57.7
|
|
|
3.4
|
%
|
||
Packaged and synthetic specialty products
|
120.6
|
|
|
6.9
|
%
|
|
140.9
|
|
|
8.3
|
%
|
||
Other
|
40.8
|
|
|
2.3
|
%
|
|
38.1
|
|
|
2.2
|
%
|
||
Total
|
$
|
696.6
|
|
|
39.8
|
%
|
|
$
|
704.4
|
|
|
41.5
|
%
|
Fuel products:
|
|
|
|
|
|
|
|
||||||
Gasoline
|
$
|
341.4
|
|
|
19.6
|
%
|
|
$
|
337.6
|
|
|
19.9
|
%
|
Diesel
|
444.0
|
|
|
25.4
|
%
|
|
424.0
|
|
|
25.0
|
%
|
||
Jet fuel
|
61.3
|
|
|
3.5
|
%
|
|
50.8
|
|
|
3.0
|
%
|
||
Asphalt, heavy fuel oils and other
|
204.9
|
|
|
11.7
|
%
|
|
179.2
|
|
|
10.6
|
%
|
||
Total
|
$
|
1,051.6
|
|
|
60.2
|
%
|
|
$
|
991.6
|
|
|
58.5
|
%
|
Consolidated sales
|
$
|
1,748.2
|
|
|
100.0
|
%
|
|
$
|
1,696.0
|
|
|
100.0
|
%
|
•
|
Package of Three - The Company has elected that it will not reassess contracts that have expired or existed at the date of adoption for (1) leases under the new definition of a lease, (2) lease classification, and (3) whether previously capitalized initial direct costs would qualify for capitalization under ASC 842.
|
•
|
Portfolio Approach - The Company elected to determine the discount rate used to measure lease liabilities at the portfolio level. Specifically, the Company segregated its leases into different populations based on lease term.
|
•
|
Discount Rate - The Company elected to apply the discount rate at transition based on the remaining lease term and lease payments rather than the original lease term and lease payments. As a majority of the Company’s leases do not provide an implicit rate, the Company used an incremental borrowing rate based on information available at the date of transition to determine the present value of lease payments.
|
•
|
Lease/Non-Lease Components - The Company elected to not separate non-lease components.
|
•
|
Definition of Minimum Rental Payments - The Company elected to include executory costs as part of the minimum lease payments for purposes of measuring the lease liability and right-of-use asset at transition.
|
•
|
Land Easement - The Company elected not to assess whether any land easements are, or contain, leases in accordance with ASC 842 when transitioning to the standard.
|
|
|
June 30, 2019
|
||
Assets:
|
Classification:
|
|
||
Operating lease assets
|
Operating lease right-of-use assets (2)
|
$
|
123.6
|
|
Finance lease assets
|
Property, plant and equipment, net (1)
|
3.6
|
|
|
Total leased assets
|
|
$
|
127.2
|
|
Liabilities:
|
|
|
||
Current
|
|
|
||
Operating
|
Current portion of operating lease liabilities (2)
|
$
|
62.1
|
|
Finance
|
Current portion of long-term debt
|
0.5
|
|
|
Non-current
|
|
|
||
Operating
|
Long-term operating lease liabilities (2)
|
62.5
|
|
|
Finance
|
Long term debt, less current portion
|
2.5
|
|
|
Total lease liabilities
|
|
$
|
127.6
|
|
|
(1)
|
Finance lease assets are recorded net of accumulated amortization of $6.7 million as of June 30, 2019.
|
(2)
|
In the second quarter of 2019, the Company had additions to its operating lease right of use assets and operating lease liabilities of approximately $3.8 million.
|
|
|
Three Months Ended
|
Six Months Ended
|
|||||
Lease Costs:
|
Classification:
|
June 30, 2019
|
||||||
Fixed operating lease cost
|
Cost of Sales; SG&A Expenses
|
$
|
16.2
|
|
|
$
|
33.7
|
|
Short-term operating lease cost (1)
|
Cost of Sales; SG&A Expenses
|
1.4
|
|
|
3.4
|
|
||
Variable operating lease cost (2) (3)
|
Cost of Sales; SG&A Expenses
|
0.2
|
|
|
0.7
|
|
||
Finance lease cost:
|
|
|
|
|
||||
Amortization of right-of-use asset
|
Cost of Sales
|
0.4
|
|
|
0.7
|
|
||
Interest on lease liabilities
|
Interest expense
|
0.1
|
|
|
1.1
|
|
||
Total lease cost
|
|
$
|
18.3
|
|
|
$
|
39.6
|
|
|
(1)
|
The Company’s leases with an initial term of 12 months or less are not recorded on the condensed consolidated balance sheets.
|
(2)
|
Approximately $0.5 million of the Company’s variable operating lease cost for the six months ended June 30, 2019 relates to its lease agreement with Phillips 66 related to the LVT unit at its Lake Charles, Louisiana refinery (“the LVT Agreement”). Pursuant to the LVT Agreement, Phillips 66 is obligated to supply a minimum supply quantity which the Company agrees to purchase through December 31, 2020. Pricing for the agreement is indexed to the prior month’s average of Platts Mid USGC 55 Grade Jet Kero price on the day of loading plus an adder. Phillips 66 invoices the Company for the estimated volume of product to be purchased by the Company based on a supplied forecast and differences between actual volumes purchased and the estimated volume of product originally billed makes up the variable component of the operating lease contract. There were no variable operating lease costs related the LVT Agreement for the three months ended June 30, 2019
|
(3)
|
The Company’s railcar leases typically include a mileage limit the railcar can travel over the life of the lease. For any mileage incurred over this limit, the Company is obligated to pay an agreed upon dollar value for each mile that is traveled over the limit.
|
Maturity of Lease Liabilities
|
Operating Leases (1)
|
|
Finance Leases (2)
|
|
Total
|
||||||
2019
|
$
|
35.2
|
|
|
$
|
0.5
|
|
|
$
|
35.7
|
|
2020
|
64.8
|
|
|
0.5
|
|
|
65.3
|
|
|||
2021
|
13.6
|
|
|
0.5
|
|
|
14.1
|
|
|||
2022
|
9.8
|
|
|
0.5
|
|
|
10.3
|
|
|||
2023
|
6.9
|
|
|
0.5
|
|
|
7.4
|
|
|||
Thereafter
|
7.2
|
|
|
1.6
|
|
|
8.8
|
|
|||
Total
|
$
|
137.5
|
|
|
$
|
4.1
|
|
|
$
|
141.6
|
|
Less: Interest
|
12.9
|
|
|
1.1
|
|
|
14.0
|
|
|||
Present value of lease liabilities
|
$
|
124.6
|
|
|
$
|
3.0
|
|
|
$
|
127.6
|
|
|
(1)
|
As of June 30, 2019, the Company’s operating lease payments included no material options to extend lease terms that are reasonably certain of being exercised. The Company has no legally binding minimum lease payments for leases signed but not yet commenced as of June 30, 2019.
|
(2)
|
As of June 30, 2019, the Company’s finance lease payments included no material options to extend lease terms that are reasonably certain of being exercised. In addition, the Company has no legally binding minimum lease payments for leases that have been signed but not yet commenced as of June 30, 2019.
|
|
June 30, 2019
|
||||||||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||
|
Parent
|
|
Co-Issuer
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Assets
|
|||||||||||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
169.2
|
|
|
$
|
4.3
|
|
|
$
|
—
|
|
|
$
|
173.5
|
|
Accounts receivable, net:
|
0.1
|
|
|
—
|
|
|
246.0
|
|
|
13.5
|
|
|
—
|
|
|
259.6
|
|
||||||
Inventories
|
—
|
|
|
—
|
|
|
283.1
|
|
|
2.0
|
|
|
—
|
|
|
285.1
|
|
||||||
Prepaid expenses and other current assets
|
—
|
|
|
—
|
|
|
12.5
|
|
|
—
|
|
|
—
|
|
|
12.5
|
|
||||||
Intercompany receivable
|
518.4
|
|
|
—
|
|
|
773.9
|
|
|
407.8
|
|
|
(1,700.1
|
)
|
|
—
|
|
||||||
Total current assets
|
518.5
|
|
|
—
|
|
|
1,484.7
|
|
|
427.6
|
|
|
(1,700.1
|
)
|
|
730.7
|
|
||||||
Property, plant and equipment, net
|
—
|
|
|
—
|
|
|
1,055.8
|
|
|
—
|
|
|
—
|
|
|
1,055.8
|
|
||||||
Goodwill and other intangible assets, net
|
—
|
|
|
—
|
|
|
251.0
|
|
|
—
|
|
|
—
|
|
|
251.0
|
|
||||||
Investment in subsidiaries
|
705.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(705.4
|
)
|
|
—
|
|
||||||
Other noncurrent assets, net
|
—
|
|
|
—
|
|
|
169.6
|
|
|
—
|
|
|
—
|
|
|
169.6
|
|
||||||
Total assets
|
$
|
1,223.9
|
|
|
$
|
—
|
|
|
$
|
2,961.1
|
|
|
$
|
427.6
|
|
|
$
|
(2,405.5
|
)
|
|
$
|
2,207.1
|
|
Liabilities and Partners’ Capital
|
|||||||||||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Accounts payable
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
250.2
|
|
|
$
|
2.4
|
|
|
$
|
—
|
|
|
$
|
252.6
|
|
Accrued and other current liabilities
|
—
|
|
|
29.6
|
|
|
311.6
|
|
|
—
|
|
|
—
|
|
|
341.2
|
|
||||||
Current portion of long-term debt
|
—
|
|
|
—
|
|
|
2.0
|
|
|
—
|
|
|
—
|
|
|
2.0
|
|
||||||
Intercompany payable
|
1,156.8
|
|
|
145.1
|
|
|
—
|
|
|
398.2
|
|
|
(1,700.1
|
)
|
|
—
|
|
||||||
Total current liabilities
|
1,156.8
|
|
|
174.7
|
|
|
563.8
|
|
|
400.6
|
|
|
(1,700.1
|
)
|
|
595.8
|
|
||||||
Other long-term liabilities
|
—
|
|
|
—
|
|
|
67.7
|
|
|
—
|
|
|
—
|
|
|
67.7
|
|
||||||
Deferred income taxes
|
—
|
|
|
—
|
|
|
0.7
|
|
|
—
|
|
|
—
|
|
|
0.7
|
|
||||||
Long-term debt, less current portion
|
—
|
|
|
1,470.2
|
|
|
5.6
|
|
|
—
|
|
|
—
|
|
|
1,475.8
|
|
||||||
Total liabilities
|
1,156.8
|
|
|
1,644.9
|
|
|
637.8
|
|
|
400.6
|
|
|
(1,700.1
|
)
|
|
2,140.0
|
|
||||||
Total partners’ capital
|
67.1
|
|
|
(1,644.9
|
)
|
|
2,323.3
|
|
|
27.0
|
|
|
(705.4
|
)
|
|
67.1
|
|
||||||
Total liabilities and partners’ capital
|
$
|
1,223.9
|
|
|
$
|
—
|
|
|
$
|
2,961.1
|
|
|
$
|
427.6
|
|
|
$
|
(2,405.5
|
)
|
|
$
|
2,207.1
|
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
||||||||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||
|
Parent
|
|
Co-Issuer
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Sales
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
894.6
|
|
|
$
|
15.3
|
|
|
$
|
(13.0
|
)
|
|
$
|
896.9
|
|
Cost of sales
|
—
|
|
|
—
|
|
|
788.7
|
|
|
12.8
|
|
|
(11.7
|
)
|
|
789.8
|
|
||||||
Gross profit
|
—
|
|
|
—
|
|
|
105.9
|
|
|
2.5
|
|
|
(1.3
|
)
|
|
107.1
|
|
||||||
Operating costs and expenses:
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|||||||||||
Selling, general and administrative
|
—
|
|
|
—
|
|
|
82.9
|
|
|
0.8
|
|
|
—
|
|
|
83.7
|
|
||||||
Loss on impairment and disposal of assets
|
—
|
|
|
—
|
|
|
16.2
|
|
|
—
|
|
|
—
|
|
|
16.2
|
|
||||||
Other operating expenses
|
—
|
|
|
—
|
|
|
2.5
|
|
|
—
|
|
|
—
|
|
|
2.5
|
|
||||||
Operating income (expense)
|
—
|
|
|
—
|
|
|
4.3
|
|
|
1.7
|
|
|
(1.3
|
)
|
|
4.7
|
|
||||||
Other income (expense):
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|||||||||||
Interest expense
|
—
|
|
|
(28.7
|
)
|
|
(4.4
|
)
|
|
—
|
|
|
—
|
|
|
(33.1
|
)
|
||||||
Other income
|
—
|
|
|
0.4
|
|
|
9.8
|
|
|
1.7
|
|
|
—
|
|
|
11.9
|
|
||||||
Equity in net income (loss) of subsidiaries
|
(16.5
|
)
|
|
—
|
|
|
(1.3
|
)
|
|
—
|
|
|
17.8
|
|
|
—
|
|
||||||
Income (loss) before income tax
|
(16.5
|
)
|
|
(28.3
|
)
|
|
8.4
|
|
|
3.4
|
|
|
16.5
|
|
|
(16.5
|
)
|
||||||
Income tax expense (benefit) from continuing operations
|
0.3
|
|
|
—
|
|
|
0.1
|
|
|
0.2
|
|
|
(0.3
|
)
|
|
0.3
|
|
||||||
Net income (loss)
|
$
|
(16.8
|
)
|
|
$
|
(28.3
|
)
|
|
$
|
8.3
|
|
|
$
|
3.2
|
|
|
$
|
16.8
|
|
|
$
|
(16.8
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income (loss) attributable to partners’ capital
|
$
|
(16.8
|
)
|
|
$
|
(28.3
|
)
|
|
$
|
8.3
|
|
|
$
|
3.2
|
|
|
$
|
16.8
|
|
|
$
|
(16.8
|
)
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
||||||||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||
|
Parent
|
|
Co-Issuer
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Sales
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,742.6
|
|
|
$
|
29.5
|
|
|
$
|
(23.9
|
)
|
|
$
|
1,748.2
|
|
Cost of sales
|
—
|
|
|
—
|
|
|
1,502.1
|
|
|
25.5
|
|
|
(22.5
|
)
|
|
1,505.1
|
|
||||||
Gross profit
|
—
|
|
|
—
|
|
|
240.5
|
|
|
4.0
|
|
|
(1.4
|
)
|
|
243.1
|
|
||||||
Operating costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Selling, general and administrative
|
—
|
|
|
—
|
|
|
166.2
|
|
|
1.6
|
|
|
—
|
|
|
167.8
|
|
||||||
Loss on impairment and disposal of assets
|
—
|
|
|
—
|
|
|
27.9
|
|
|
—
|
|
|
—
|
|
|
27.9
|
|
||||||
Other operating expense
|
—
|
|
|
—
|
|
|
8.9
|
|
|
—
|
|
|
—
|
|
|
8.9
|
|
||||||
Operating income (expense)
|
—
|
|
|
—
|
|
|
37.5
|
|
|
2.4
|
|
|
(1.4
|
)
|
|
38.5
|
|
||||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest expense
|
—
|
|
|
(58.0
|
)
|
|
(7.4
|
)
|
|
—
|
|
|
—
|
|
|
(65.4
|
)
|
||||||
Equity in net income (loss) of subsidiaries
|
(0.2
|
)
|
|
—
|
|
|
(1.4
|
)
|
|
—
|
|
|
1.6
|
|
|
—
|
|
||||||
Other income
|
—
|
|
|
0.7
|
|
|
25.0
|
|
|
1.0
|
|
|
—
|
|
|
26.7
|
|
||||||
Net income (loss) before income tax
|
(0.2
|
)
|
|
(57.3
|
)
|
|
53.7
|
|
|
3.4
|
|
|
0.2
|
|
|
(0.2
|
)
|
||||||
Income tax expense (benefit)
|
0.2
|
|
|
—
|
|
|
(0.1
|
)
|
|
0.3
|
|
|
(0.2
|
)
|
|
0.2
|
|
||||||
Net income (loss)
|
$
|
(0.4
|
)
|
|
$
|
(57.3
|
)
|
|
$
|
53.8
|
|
|
$
|
3.1
|
|
|
$
|
0.4
|
|
|
$
|
(0.4
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency translation adjustment
|
1.2
|
|
|
—
|
|
|
—
|
|
|
1.2
|
|
|
(1.2
|
)
|
|
1.2
|
|
||||||
Comprehensive income (loss) attributable to partner's capital
|
$
|
0.8
|
|
|
$
|
(57.3
|
)
|
|
$
|
53.8
|
|
|
$
|
4.3
|
|
|
$
|
(0.8
|
)
|
|
$
|
0.8
|
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||
|
2019
|
||||||||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||
|
Parent
|
|
Co-Issuer
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Operating activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net cash provided by (used in) operating activities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
90.0
|
|
|
$
|
(0.4
|
)
|
|
$
|
—
|
|
|
$
|
89.6
|
|
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Additions to property, plant and equipment
|
—
|
|
|
—
|
|
|
(17.1
|
)
|
|
—
|
|
|
—
|
|
|
(17.1
|
)
|
||||||
Proceeds from sale of unconsolidated affiliate
|
—
|
|
|
—
|
|
|
5.0
|
|
|
—
|
|
|
—
|
|
|
5.0
|
|
||||||
Proceeds from sale of property, plant and equipment
|
—
|
|
|
—
|
|
|
3.7
|
|
|
—
|
|
|
—
|
|
|
3.7
|
|
||||||
Net cash provided by discontinued investing activities
|
—
|
|
|
—
|
|
|
5.0
|
|
|
—
|
|
|
—
|
|
|
5.0
|
|
||||||
(Contributions) Distribution to subsidiaries
|
—
|
|
|
88.6
|
|
|
—
|
|
|
—
|
|
|
(88.6
|
)
|
|
—
|
|
||||||
Net cash provided by (used in) investing activities
|
—
|
|
|
88.6
|
|
|
(3.4
|
)
|
|
—
|
|
|
(88.6
|
)
|
|
(3.4
|
)
|
||||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Repayments of borrowings — senior notes
|
—
|
|
|
(88.6
|
)
|
|
(0.7
|
)
|
|
—
|
|
|
—
|
|
|
(89.3
|
)
|
||||||
Net proceeds from inventory financing obligations
|
—
|
|
|
—
|
|
|
22.0
|
|
|
—
|
|
|
—
|
|
|
22.0
|
|
||||||
Payments on other financing obligations
|
(0.6
|
)
|
|
—
|
|
|
(0.6
|
)
|
|
—
|
|
|
—
|
|
|
(1.2
|
)
|
||||||
Changes in intercompany balances
|
0.5
|
|
|
—
|
|
|
(87.0
|
)
|
|
(2.1
|
)
|
|
88.6
|
|
|
—
|
|
||||||
Contributions from Calumet GP, LLC
|
0.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
||||||
Net cash provided by (used in) financing activities
|
—
|
|
|
(88.6
|
)
|
|
(66.3
|
)
|
|
(2.1
|
)
|
|
88.6
|
|
|
(68.4
|
)
|
||||||
Net increase (decrease) in cash and cash equivalents
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20.3
|
|
|
$
|
(2.5
|
)
|
|
$
|
—
|
|
|
$
|
17.8
|
|
Cash and cash equivalents at beginning of period
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
148.9
|
|
|
$
|
6.8
|
|
|
$
|
—
|
|
|
$
|
155.7
|
|
Cash and cash equivalents at end of period
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
169.2
|
|
|
$
|
4.3
|
|
|
$
|
—
|
|
|
$
|
173.5
|
|
•
|
We continue to focus on improving operations. Our total feedstock runs were 104,921 barrels per day (“bpd”) during the second quarter 2019, compared to 91,637 bpd during the second quarter 2018. This increase is primarily attributed to improved plant utilization rates in the current period in comparison to the prior period when turnaround activities at the Shreveport refinery and certain third-party processing facilities and maintenance activities negatively impacted our operating results. We anticipate secular improvement in our utilization rates as we seek to minimize unplanned downtime at our facilities.
|
•
|
Gasoline margins are expected to increase in response to the higher domestic demand associated with the summer driving season. Diesel margins continue to be positively impacted by the market supply and are expected to remain relatively stable over the short-term with the potential to be positively affected by the implementation of the International Maritime Organization 2020 regulations.
|
•
|
Asphalt demand is expected to remain consistent with the second quarter of 2019 due to the seasonality of the road construction and roofing industries.
|
•
|
Environmental regulations continue to affect our margins in the form of the cost of Renewable Identification Numbers (“RINs”). To the extent we are unable to blend biofuels, we must purchase RINs in the open market to satisfy our annual requirement. The approximate 80% increase in the price of RINs during the second quarter 2019 unfavorably affected our results of operations. It is not possible to predict what future RINs volumes or costs may be given the volatile price of RINs, but we continue to anticipate that RINs have the potential to remain a significant expense for our fuel products segment (inclusive of the favorable impact of exemptions received), assuming current market prices for RINs continue. While we applied for RINs exemptions, we have not learned whether we will receive any exemptions in 2019 for the 2018 operating year.
|
•
|
Late in the fourth quarter of 2018 and into 2019, the Canadian heavy sour crude oil discounts have narrowed in comparison to the large discounts seen throughout much of 2018 caused by the oversupply of sour crude oil and pipeline constraints restricting access to markets. The price of domestically produced mid-continent crude is expected to continue to trade at a discount relative to internationally produced crude reflecting increased domestic production combined with
|
•
|
Specialty product margins, as a percentage of sales, have remained relatively stable and are expected to remain stable in the near term. We continue to consider our specialty products segment our core business over the long term, and we plan to seek appropriate ways to further invest in our specialty products segment.
|
•
|
We continue to evaluate opportunities to divest non-core businesses and assets in line with our strategy of preserving liquidity and streamlining our business to better focus on the advancement of our core business. In addition, we may also consider the disposition of certain core assets or businesses, to the extent such a transaction would improve our capital structure or otherwise be accretive to the Company. There can be no assurance as to the timing or success of any such potential transaction, or any other transaction, or that we will be able to sell such assets or businesses on satisfactory terms, if at all. In addition, our acquisition program targets assets that management believes will be financially accretive, and we intend to focus on targeted strategic acquisitions of specialty products assets that leverage an existing core competency and that have an identifiable competitive advantage we can exploit as the new owner.
|
•
|
sales volumes;
|
•
|
production yields;
|
•
|
segment gross profit;
|
•
|
segment Adjusted EBITDA; and
|
•
|
selling, general and administrative expenses.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||
|
2019
|
|
2018
|
|
% Change
|
|
2019
|
|
2018
|
|
% Change
|
||||||
|
(In bpd)
|
|
|
|
(In bpd)
|
|
|
||||||||||
Total sales volume (1)
|
102,923
|
|
|
102,484
|
|
|
0.4
|
%
|
|
105,961
|
|
|
95,298
|
|
|
11.2
|
%
|
Total feedstock runs (2)
|
104,415
|
|
|
98,704
|
|
|
5.8
|
%
|
|
104,921
|
|
|
91,637
|
|
|
14.5
|
%
|
Facility production: (3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Specialty products:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Lubricating oils
|
11,327
|
|
|
13,755
|
|
|
(17.7
|
)%
|
|
11,839
|
|
|
11,904
|
|
|
(0.5
|
)%
|
Solvents
|
7,317
|
|
|
7,726
|
|
|
(5.3
|
)%
|
|
7,624
|
|
|
7,854
|
|
|
(2.9
|
)%
|
Waxes
|
1,427
|
|
|
1,172
|
|
|
21.8
|
%
|
|
1,403
|
|
|
1,205
|
|
|
16.4
|
%
|
Packaged and synthetic specialty products (4)
|
1,747
|
|
|
2,458
|
|
|
(28.9
|
)%
|
|
1,810
|
|
|
2,448
|
|
|
(26.1
|
)%
|
Other
|
1,660
|
|
|
2,087
|
|
|
(20.5
|
)%
|
|
1,417
|
|
|
1,898
|
|
|
(25.3
|
)%
|
Total
|
23,478
|
|
|
27,198
|
|
|
(13.7
|
)%
|
|
24,093
|
|
|
25,309
|
|
|
(4.8
|
)%
|
Fuel products:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Gasoline
|
23,245
|
|
|
21,135
|
|
|
10.0
|
%
|
|
23,924
|
|
|
19,501
|
|
|
22.7
|
%
|
Diesel
|
28,233
|
|
|
27,993
|
|
|
0.9
|
%
|
|
29,349
|
|
|
25,534
|
|
|
14.9
|
%
|
Jet fuel
|
5,517
|
|
|
2,705
|
|
|
104.0
|
%
|
|
4,081
|
|
|
3,223
|
|
|
26.6
|
%
|
Asphalt, heavy fuels and other
|
21,484
|
|
|
20,869
|
|
|
2.9
|
%
|
|
20,413
|
|
|
18,909
|
|
|
8.0
|
%
|
Total
|
78,479
|
|
|
72,702
|
|
|
7.9
|
%
|
|
77,767
|
|
|
67,167
|
|
|
15.8
|
%
|
Total facility production (3)
|
101,957
|
|
|
99,900
|
|
|
2.1
|
%
|
|
101,860
|
|
|
92,476
|
|
|
10.1
|
%
|
|
(1)
|
Total sales volume includes sales from the production at our facilities and certain third-party facilities pursuant to supply and/or processing agreements, sales of inventories and the resale of crude oil to third-party customers. Total sales volume includes the sale of purchased fuel product blendstocks, such as ethanol and biodiesel, as components of finished fuel products in our fuel products segment sales.
|
(2)
|
Total feedstock runs represent the barrels per day of crude oil and other feedstocks processed at our facilities and at certain third-party facilities pursuant to supply and/or processing agreements.
|
(3)
|
Total facility production represents the barrels per day of specialty products and fuel products yielded from processing crude oil and other feedstocks at our facilities and at certain third-party facilities pursuant to supply and/or processing agreements. The difference between total facility production and total feedstock runs is primarily a result of the time lag between the input of feedstocks and production of finished products and volume loss.
|
(4)
|
Represents production of finished lubricants and chemicals specialty products including the products from the Royal Purple, Bel-Ray and Calumet Packaging facilities.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In millions)
|
||||||||||||||
Sales
|
$
|
896.9
|
|
|
$
|
945.5
|
|
|
$
|
1,748.2
|
|
|
$
|
1,696.0
|
|
Cost of sales
|
789.8
|
|
|
822.1
|
|
|
1,505.1
|
|
|
1,459.4
|
|
||||
Gross profit
|
107.1
|
|
|
123.4
|
|
|
243.1
|
|
|
236.6
|
|
||||
Operating costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Selling
|
14.3
|
|
|
10.6
|
|
|
27.6
|
|
|
25.3
|
|
||||
General and administrative
|
37.8
|
|
|
31.9
|
|
|
72.7
|
|
|
72.5
|
|
||||
Transportation
|
31.6
|
|
|
33.0
|
|
|
67.5
|
|
|
63.3
|
|
||||
Taxes other than income taxes
|
4.7
|
|
|
5.4
|
|
|
9.8
|
|
|
7.3
|
|
||||
Loss on impairment and disposal of assets
|
16.2
|
|
|
0.7
|
|
|
27.9
|
|
|
1.2
|
|
||||
Other operating income
|
(2.2
|
)
|
|
(1.8
|
)
|
|
(0.9
|
)
|
|
(17.9
|
)
|
||||
Operating income
|
4.7
|
|
|
43.6
|
|
|
38.5
|
|
|
84.9
|
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
(33.1
|
)
|
|
(37.5
|
)
|
|
(65.4
|
)
|
|
(82.7
|
)
|
||||
Gain (loss) from debt extinguishment
|
0.3
|
|
|
(58.2
|
)
|
|
0.7
|
|
|
(58.8
|
)
|
||||
Gain on derivative instruments
|
10.3
|
|
|
0.8
|
|
|
19.4
|
|
|
0.7
|
|
||||
Other
|
1.3
|
|
|
0.9
|
|
|
6.6
|
|
|
2.4
|
|
||||
Total other expense
|
(21.2
|
)
|
|
(94.0
|
)
|
|
(38.7
|
)
|
|
(138.4
|
)
|
||||
Net loss from continuing operations before income taxes
|
(16.5
|
)
|
|
(50.4
|
)
|
|
(0.2
|
)
|
|
(53.5
|
)
|
||||
Income tax expense from continuing operations
|
0.3
|
|
|
0.8
|
|
|
0.2
|
|
|
0.6
|
|
||||
Net loss from continuing operations
|
$
|
(16.8
|
)
|
|
$
|
(51.2
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(54.1
|
)
|
Net loss from discontinued operations, net of tax
|
$
|
—
|
|
|
$
|
(0.7
|
)
|
|
$
|
—
|
|
|
$
|
(2.6
|
)
|
Net loss
|
$
|
(16.8
|
)
|
|
$
|
(51.9
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(56.7
|
)
|
EBITDA
|
$
|
43.6
|
|
|
$
|
15.9
|
|
|
$
|
120.4
|
|
|
$
|
85.8
|
|
Adjusted EBITDA
|
$
|
79.6
|
|
|
$
|
78.9
|
|
|
$
|
177.3
|
|
|
$
|
153.9
|
|
Distributable Cash Flow
|
$
|
35.7
|
|
|
$
|
36.5
|
|
|
$
|
91.4
|
|
|
$
|
59.5
|
|
•
|
the financial performance of our assets without regard to financing methods, capital structure or historical cost basis;
|
•
|
the ability of our assets to generate cash sufficient to pay interest costs and support our indebtedness;
|
•
|
our operating performance and return on capital as compared to those of other companies in our industry, without regard to financing or capital structure; and
|
•
|
the viability of acquisitions and capital expenditure projects and the overall rates of return on alternative investment opportunities.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In millions)
|
||||||||||||||
Reconciliation of Net loss to EBITDA, Adjusted EBITDA and Distributable Cash Flow:
|
|
||||||||||||||
Net loss
|
$
|
(16.8
|
)
|
|
$
|
(51.9
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(56.7
|
)
|
Add:
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
33.1
|
|
|
37.5
|
|
|
65.4
|
|
|
82.7
|
|
||||
Depreciation and amortization
|
27.0
|
|
|
29.5
|
|
|
55.2
|
|
|
59.2
|
|
||||
Income tax expense
|
0.3
|
|
|
0.8
|
|
|
0.2
|
|
|
0.6
|
|
||||
EBITDA
|
$
|
43.6
|
|
|
$
|
15.9
|
|
|
$
|
120.4
|
|
|
$
|
85.8
|
|
Add:
|
|
|
|
|
|
|
|
||||||||
Unrealized (gain) loss on derivative instruments
|
$
|
12.2
|
|
|
$
|
(0.8
|
)
|
|
$
|
14.8
|
|
|
$
|
(2.8
|
)
|
Realized loss on derivatives, not included in net loss or settled in a prior period
|
—
|
|
|
2.1
|
|
|
—
|
|
|
2.1
|
|
||||
Amortization of turnaround costs
|
5.6
|
|
|
2.7
|
|
|
10.4
|
|
|
6.0
|
|
||||
(Gain) loss from debt extinguishment
|
(0.3
|
)
|
|
58.2
|
|
|
(0.7
|
)
|
|
58.8
|
|
||||
Loss on impairment and disposal of assets
|
16.2
|
|
|
0.7
|
|
|
27.9
|
|
|
1.2
|
|
||||
Gain on sale of unconsolidated affiliate (3)
|
—
|
|
|
—
|
|
|
(1.2
|
)
|
|
—
|
|
||||
Equity based compensation and other items
|
2.3
|
|
|
0.1
|
|
|
5.7
|
|
|
2.8
|
|
||||
Adjusted EBITDA (4)
|
$
|
79.6
|
|
|
$
|
78.9
|
|
|
$
|
177.3
|
|
|
$
|
153.9
|
|
Less:
|
|
|
|
|
|
|
|
||||||||
Replacement and environmental capital expenditures (1)
|
$
|
7.4
|
|
|
$
|
5.0
|
|
|
$
|
13.6
|
|
|
$
|
11.6
|
|
Cash interest expense (2)
|
31.5
|
|
|
35.8
|
|
|
61.9
|
|
|
78.3
|
|
||||
Turnaround costs
|
4.7
|
|
|
0.8
|
|
|
6.4
|
|
|
7.6
|
|
||||
Income (loss) from unconsolidated affiliates (3)
|
—
|
|
|
—
|
|
|
3.8
|
|
|
(3.7
|
)
|
||||
Income tax expense
|
0.3
|
|
|
0.8
|
|
|
0.2
|
|
|
0.6
|
|
||||
Distributable Cash Flow
|
$
|
35.7
|
|
|
$
|
36.5
|
|
|
$
|
91.4
|
|
|
$
|
59.5
|
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Reconciliation of Distributable Cash Flow, Adjusted EBITDA and EBITDA to Net cash provided by (used in) operating activities:
|
|
|
|
||||
Distributable Cash Flow
|
$
|
91.4
|
|
|
$
|
59.5
|
|
Add:
|
|
|
|
||||
Replacement and environmental capital expenditures (1)
|
13.6
|
|
|
11.6
|
|
||
Cash interest expense (2)
|
61.9
|
|
|
78.3
|
|
||
Turnaround costs
|
6.4
|
|
|
7.6
|
|
||
Income (loss) from unconsolidated affiliates (3)
|
3.8
|
|
|
(3.7
|
)
|
||
Income tax expense
|
0.2
|
|
|
0.6
|
|
||
Adjusted EBITDA (4)
|
$
|
177.3
|
|
|
$
|
153.9
|
|
Less:
|
|
|
|
||||
Unrealized (gain) loss on derivative instruments
|
$
|
14.8
|
|
|
$
|
(2.8
|
)
|
Realized loss on derivatives, not included in net loss or settled in a prior period
|
—
|
|
|
2.1
|
|
||
Amortization of turnaround costs
|
10.4
|
|
|
6.0
|
|
||
(Gain) loss from debt extinguishment
|
(0.7
|
)
|
|
58.8
|
|
||
Loss on impairment and disposal of assets
|
27.9
|
|
|
1.2
|
|
||
Gain on sale of unconsolidated affiliate (3)
|
(1.2
|
)
|
|
—
|
|
||
Equity based compensation and other items
|
5.7
|
|
|
2.8
|
|
||
EBITDA
|
$
|
120.4
|
|
|
$
|
85.8
|
|
Add:
|
|
|
|
||||
Unrealized (gain) loss on derivative instruments
|
$
|
14.8
|
|
|
$
|
(2.8
|
)
|
Cash interest expense (2)
|
(61.9
|
)
|
|
(78.3
|
)
|
||
Equity based compensation
|
4.6
|
|
|
1.8
|
|
||
Lower of cost or market inventory adjustment
|
(41.5
|
)
|
|
(15.0
|
)
|
||
(Income) loss from unconsolidated affiliates (3)
|
(3.8
|
)
|
|
3.7
|
|
||
Gain on sale of unconsolidated affiliate (3)
|
(1.2
|
)
|
|
—
|
|
||
Amortization of turnaround costs
|
10.4
|
|
|
6.0
|
|
||
(Gain) loss from debt extinguishment
|
(0.7
|
)
|
|
58.8
|
|
||
Operating lease expense
|
37.8
|
|
|
—
|
|
||
Operating lease payments
|
(37.4
|
)
|
|
—
|
|
||
Loss on impairment and disposal of assets
|
27.9
|
|
|
1.2
|
|
||
Income tax expense
|
(0.2
|
)
|
|
(0.6
|
)
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(66.6
|
)
|
|
19.5
|
|
||
Inventories
|
40.5
|
|
|
(2.6
|
)
|
||
Other current assets
|
6.0
|
|
|
2.2
|
|
||
Derivative activity
|
(0.3
|
)
|
|
(0.3
|
)
|
||
Turnaround costs
|
(6.4
|
)
|
|
(7.6
|
)
|
||
Other assets
|
0.1
|
|
|
—
|
|
||
Accounts payable
|
42.9
|
|
|
(17.7
|
)
|
||
Accrued interest payable
|
(0.5
|
)
|
|
(20.3
|
)
|
||
Other current liabilities
|
3.3
|
|
|
(56.2
|
)
|
||
Other
|
1.4
|
|
|
(0.9
|
)
|
||
Net cash provided by (used in) operating activities
|
$
|
89.6
|
|
|
$
|
(23.3
|
)
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In millions)
|
||||||||||||||
Reconciliation of Segment Adjusted EBITDA to EBITDA and Net loss:
|
|
|
|
|
|
||||||||||
Segment Adjusted EBITDA
|
|
|
|
|
|
|
|
||||||||
Specialty products Adjusted EBITDA
|
$
|
47.3
|
|
|
$
|
53.7
|
|
|
$
|
103.6
|
|
|
$
|
91.4
|
|
Fuel products Adjusted EBITDA
|
32.3
|
|
|
25.6
|
|
|
73.7
|
|
|
64.3
|
|
||||
Discontinued operations Adjusted EBITDA
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
|
(1.8
|
)
|
||||
Total segment Adjusted EBITDA (4)
|
$
|
79.6
|
|
|
$
|
78.9
|
|
|
$
|
177.3
|
|
|
$
|
153.9
|
|
Less:
|
|
|
|
|
|
|
|
||||||||
Unrealized (gain) loss on derivative instruments
|
$
|
12.2
|
|
|
$
|
(0.8
|
)
|
|
$
|
14.8
|
|
|
$
|
(2.8
|
)
|
Realized loss on derivatives, not included in net loss or settled in a prior period
|
—
|
|
|
2.1
|
|
|
—
|
|
|
2.1
|
|
||||
Amortization of turnaround costs
|
5.6
|
|
|
2.7
|
|
|
10.4
|
|
|
6.0
|
|
||||
(Gain) loss from debt extinguishment
|
(0.3
|
)
|
|
58.2
|
|
|
(0.7
|
)
|
|
58.8
|
|
||||
Gain on sale of unconsolidated affiliate (3)
|
—
|
|
|
—
|
|
|
(1.2
|
)
|
|
—
|
|
||||
Loss on impairment and disposal of assets
|
16.2
|
|
|
0.7
|
|
|
27.9
|
|
|
1.2
|
|
||||
Equity based compensation and other items
|
2.3
|
|
|
0.1
|
|
|
5.7
|
|
|
2.8
|
|
||||
EBITDA
|
$
|
43.6
|
|
|
$
|
15.9
|
|
|
$
|
120.4
|
|
|
$
|
85.8
|
|
Less:
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
$
|
33.1
|
|
|
$
|
37.5
|
|
|
$
|
65.4
|
|
|
$
|
82.7
|
|
Depreciation and amortization
|
27.0
|
|
|
29.5
|
|
|
55.2
|
|
|
59.2
|
|
||||
Income tax expense
|
0.3
|
|
|
0.8
|
|
|
0.2
|
|
|
0.6
|
|
||||
Net loss
|
$
|
(16.8
|
)
|
|
$
|
(51.9
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(56.7
|
)
|
|
(1)
|
Replacement capital expenditures are defined as those capital expenditures which do not increase operating capacity or reduce operating costs and exclude turnaround costs. Environmental capital expenditures include asset additions to meet or exceed environmental and operating regulations.
|
(2)
|
Represents consolidated interest expense less non-cash interest expense.
|
(3)
|
In 2018, the Company and The Heritage Group formed Biosyn Holdings, LLC (“Biosyn”) for the purposes of acquiring Biosynthetic Technologies, LLC (“Biosynthetic Technologies”), a startup company which developed an intellectual property portfolio for the manufacture of renewable-based and biodegradable esters. The initial cash investment of $3.8 million made by the Company into Biosyn was expensed in the period ended March 31, 2018 given Biosyn’s operations were all related to research and development. The Company accounts for its ownership in Biosyn under the equity method of accounting. During March 2019, the Company sold its investment to The Heritage Group and recognized a gain of $5.0 million. For comparability purposes, $3.8 million of the gain is included in Adjusted EBITDA for the six months ended June 30, 2019.
|
(4)
|
Total segment Adjusted EBITDA includes the non-cash impact of the following LCM inventory adjustments and losses related to the liquidation of LIFO inventory layers.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(In millions)
|
||||||||||||||
LCM Impact
|
$
|
2.6
|
|
|
$
|
11.9
|
|
|
$
|
41.5
|
|
|
$
|
15.0
|
|
LIFO Impact
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(0.9
|
)
|
|
$
|
—
|
|
|
Three Months Ended June 30,
|
|||||||||
|
2019
|
|
2018
|
|
% Change
|
|||||
|
(Dollars in millions, except barrel and per barrel data)
|
|||||||||
Sales by segment:
|
|
|
|
|
|
|||||
Specialty products:
|
|
|
|
|
|
|||||
Lubricating oils
|
$
|
152.5
|
|
|
$
|
165.5
|
|
|
(7.9
|
)%
|
Solvents
|
80.7
|
|
|
94.0
|
|
|
(14.1
|
)%
|
||
Waxes
|
31.6
|
|
|
28.1
|
|
|
12.5
|
%
|
||
Packaged and synthetic specialty products (1)
|
60.7
|
|
|
72.9
|
|
|
(16.7
|
)%
|
||
Other (2)
|
18.9
|
|
|
22.1
|
|
|
(14.5
|
)%
|
||
Total specialty products
|
$
|
344.4
|
|
|
$
|
382.6
|
|
|
(10.0
|
)%
|
Total specialty products sales volume (in barrels)
|
2,241,000
|
|
|
2,371,000
|
|
|
(5.5
|
)%
|
||
Average specialty products sales price per barrel
|
$
|
153.68
|
|
|
$
|
161.37
|
|
|
(4.8
|
)%
|
|
|
|
|
|
|
|||||
Fuel products:
|
|
|
|
|
|
|||||
Gasoline
|
$
|
183.8
|
|
|
$
|
187.8
|
|
|
(2.1
|
)%
|
Diesel
|
218.1
|
|
|
250.7
|
|
|
(13.0
|
)%
|
||
Jet fuel
|
40.7
|
|
|
20.9
|
|
|
94.7
|
%
|
||
Asphalt, heavy fuel oils and other (3)
|
109.9
|
|
|
103.5
|
|
|
6.2
|
%
|
||
Total fuel products
|
$
|
552.5
|
|
|
$
|
562.9
|
|
|
(1.8
|
)%
|
Total fuel products sales volume (in barrels)
|
7,125,000
|
|
|
6,955,000
|
|
|
2.4
|
%
|
||
Average fuel products sales price per barrel
|
$
|
77.54
|
|
|
$
|
80.93
|
|
|
(4.2
|
)%
|
|
|
|
|
|
|
|||||
Total sales
|
$
|
896.9
|
|
|
$
|
945.5
|
|
|
(5.1
|
)%
|
Total specialty and fuel products sales volume (in barrels)
|
9,366,000
|
|
|
9,326,000
|
|
|
0.4
|
%
|
|
(1)
|
Represents packaged and synthetic specialty products at the Royal Purple, Bel-Ray and Calumet Packaging facilities.
|
(2)
|
Represents (a) by-products, including fuels and asphalt, produced in connection with the production of specialty products at the Princeton and Cotton Valley refineries and Dickinson and Karns City facilities and (b) polyolester synthetic lubricants produced at the Missouri facility.
|
(3)
|
Represents asphalt, heavy fuel oils and other products produced in connection with the production of fuels at the Shreveport, San Antonio and Great Falls refineries and crude oil sales from the San Antonio refinery to third-party customers.
|
|
Dollar Change
|
||
|
(In millions)
|
||
Volume
|
$
|
(20.9
|
)
|
Sales price
|
(17.3
|
)
|
|
Total specialty products segment sales decrease
|
$
|
(38.2
|
)
|
|
Dollar Change
|
||
|
(In millions)
|
||
Volume
|
$
|
13.8
|
|
Sales price
|
(24.2
|
)
|
|
Total fuel products segment sales decrease
|
$
|
(10.4
|
)
|
|
Three Months Ended June 30,
|
|||||||||
|
2019
|
|
2018
|
|
% Change
|
|||||
|
(Dollars in millions, except per barrel data)
|
|||||||||
Gross profit by segment:
|
|
|
|
|
|
|||||
Specialty products:
|
|
|
|
|
|
|||||
Gross profit
|
$
|
82.0
|
|
|
$
|
88.0
|
|
|
(6.8
|
)%
|
Percentage of sales
|
23.8
|
%
|
|
23.0
|
%
|
|
|
|||
Specialty products gross profit per barrel
|
$
|
36.59
|
|
|
$
|
37.12
|
|
|
(1.4
|
)%
|
Fuel products:
|
|
|
|
|
|
|||||
Gross profit
|
$
|
25.1
|
|
|
$
|
35.4
|
|
|
(29.1
|
)%
|
Percentage of sales
|
4.5
|
%
|
|
6.3
|
%
|
|
|
|||
Fuel products gross profit per barrel
|
$
|
3.52
|
|
|
$
|
5.09
|
|
|
(30.8
|
)%
|
Total gross profit
|
$
|
107.1
|
|
|
$
|
123.4
|
|
|
(13.2
|
)%
|
Percentage of sales
|
11.9
|
%
|
|
13.1
|
%
|
|
|
|
Dollar Change
|
||
|
(In millions)
|
||
Three months ended June 30, 2018 reported gross profit
|
$
|
88.0
|
|
Sales Price
|
(17.3
|
)
|
|
Volume
|
(7.6
|
)
|
|
LCM inventory adjustment
|
(4.5
|
)
|
|
Operating costs
|
(1.7
|
)
|
|
Cost of materials
|
25.1
|
|
|
Three months ended June 30, 2019 reported gross profit
|
$
|
82.0
|
|
|
Dollar Change
|
||
|
(In millions)
|
||
Three months ended June 30, 2018 reported gross profit
|
$
|
35.4
|
|
Sales Price
|
(24.2
|
)
|
|
LCM inventory adjustment
|
(4.8
|
)
|
|
RINs expense
|
(6.2
|
)
|
|
Volume
|
2.6
|
|
|
Operating costs
|
3.3
|
|
|
Cost of materials
|
19.0
|
|
|
Three months ended June 30, 2019 reported gross profit
|
$
|
25.1
|
|
|
Three Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Derivative loss reflected in cost of sales
|
$
|
—
|
|
|
$
|
(2.1
|
)
|
Derivative loss reflected in gross profit
|
$
|
—
|
|
|
$
|
(2.1
|
)
|
|
|
|
|
|
|
||
Realized gain on derivative instruments
|
$
|
22.5
|
|
|
$
|
—
|
|
Unrealized gain (loss) on derivative instruments
|
$
|
(12.2
|
)
|
|
$
|
0.8
|
|
Total derivative gain (loss) reflected in the unaudited condensed consolidated statements of operations
|
$
|
10.3
|
|
|
$
|
(1.3
|
)
|
Total gain on commodity derivative settlements
|
$
|
22.5
|
|
|
$
|
—
|
|
|
Six Months Ended June 30,
|
|||||||||
|
2019
|
|
2018
|
|
% Change
|
|||||
|
(Dollars in millions, except barrel and per barrel data)
|
|||||||||
Sales by segment:
|
|
|
|
|
|
|||||
Specialty products:
|
|
|
|
|
|
|||||
Lubricating oils
|
$
|
304.6
|
|
|
$
|
301.7
|
|
|
1.0
|
%
|
Solvents
|
168.1
|
|
|
166.0
|
|
|
1.3
|
%
|
||
Waxes
|
62.5
|
|
|
57.7
|
|
|
8.3
|
%
|
||
Packaged and synthetic specialty products (1)
|
120.6
|
|
|
140.9
|
|
|
(14.4
|
)%
|
||
Other (2)
|
40.8
|
|
|
38.1
|
|
|
7.1
|
%
|
||
Total specialty products
|
$
|
696.6
|
|
|
$
|
704.4
|
|
|
(1.1
|
)%
|
Total specialty products sales volume (in barrels)
|
4,682,000
|
|
|
4,473,000
|
|
|
4.7
|
%
|
||
Average specialty products sales price per barrel
|
$
|
148.78
|
|
|
$
|
157.48
|
|
|
(5.5
|
)%
|
|
|
|
|
|
|
|||||
Fuel products:
|
|
|
|
|
|
|||||
Gasoline
|
$
|
341.4
|
|
|
$
|
337.6
|
|
|
1.1
|
%
|
Diesel
|
444.0
|
|
|
424.0
|
|
|
4.7
|
%
|
||
Jet fuel
|
61.3
|
|
|
50.8
|
|
|
20.7
|
%
|
||
Asphalt, heavy fuel oils and other (3)
|
204.9
|
|
|
179.2
|
|
|
14.3
|
%
|
||
Total fuel products
|
$
|
1,051.6
|
|
|
$
|
991.6
|
|
|
6.1
|
%
|
Total fuel products sales volume (in barrels)
|
14,497,000
|
|
|
12,776,000
|
|
|
13.5
|
%
|
||
Average fuel products sales price per barrel
|
$
|
72.54
|
|
|
$
|
77.61
|
|
|
(6.5
|
)%
|
|
|
|
|
|
|
|||||
Total sales
|
$
|
1,748.2
|
|
|
$
|
1,696.0
|
|
|
3.1
|
%
|
Total specialty and fuel products sales volume (in barrels)
|
19,179,000
|
|
|
17,249,000
|
|
|
11.2
|
%
|
|
(1)
|
Represents packaged and synthetic specialty products at the Royal Purple, Bel-Ray and Calumet Packaging facilities.
|
(2)
|
Represents (a) by-products, including fuels and asphalt, produced in connection with the production of specialty products at the Princeton and Cotton Valley refineries and Dickinson and Karns City facilities and (b) polyolester synthetic lubricants produced at the Missouri facility.
|
(3)
|
Represents asphalt, heavy fuel oils and other products produced in connection with the production of fuels at the Shreveport, Superior, San Antonio and Great Falls refineries and crude oil sales from the Superior and San Antonio refineries to third-party customers.
|
|
Dollar Change
|
||
|
(In millions)
|
||
Volume
|
32.8
|
|
|
Sales price
|
(40.6
|
)
|
|
Total specialty products segment sales decrease
|
$
|
(7.8
|
)
|
|
Dollar Change
|
||
|
(In millions)
|
||
Volume
|
133.6
|
|
|
Sales price
|
(73.6
|
)
|
|
Total fuel products segment sales increase
|
$
|
60.0
|
|
|
Six Months Ended June 30,
|
|||||||||
|
2019
|
|
2018
|
|
% Change
|
|||||
|
(Dollars in millions, except per barrel data)
|
|||||||||
Gross profit by segment:
|
|
|
|
|
|
|||||
Specialty products:
|
|
|
|
|
|
|||||
Gross profit
|
$
|
174.9
|
|
|
$
|
157.6
|
|
|
11.0
|
%
|
Percentage of sales
|
25.1
|
%
|
|
22.4
|
%
|
|
|
|
||
Specialty products gross profit per barrel
|
$
|
37.36
|
|
|
$
|
35.23
|
|
|
6.0
|
%
|
Fuel products:
|
|
|
|
|
|
|||||
Gross profit
|
$
|
68.2
|
|
|
$
|
79.0
|
|
|
(13.7
|
)%
|
Percentage of sales
|
6.5
|
%
|
|
8.0
|
%
|
|
|
|||
Fuel products gross profit per barrel
|
$
|
4.70
|
|
|
$
|
6.18
|
|
|
(23.9
|
)%
|
Total gross profit
|
$
|
243.1
|
|
|
$
|
236.6
|
|
|
2.7
|
%
|
Percentage of sales
|
13.9
|
%
|
|
14.0
|
%
|
|
|
|
Dollar Change
|
||
|
(In millions)
|
||
Six months ended June 30, 2018 reported gross profit
|
$
|
157.6
|
|
Sales price
|
(40.6
|
)
|
|
LIFO inventory layer adjustment
|
(0.9
|
)
|
|
LCM inventory adjustment
|
(0.2
|
)
|
|
Operating costs
|
0.4
|
|
|
Volume
|
12.2
|
|
|
Cost of materials
|
46.4
|
|
|
Six months ended June 30, 2019 reported gross profit
|
$
|
174.9
|
|
|
Dollar Change
|
||
|
(In millions)
|
||
Six months ended June 30, 2018 reported gross profit
|
$
|
79.0
|
|
Sales price
|
(73.6
|
)
|
|
RINs expense
|
(48.4
|
)
|
|
Operating costs
|
(2.2
|
)
|
|
Volume
|
24.0
|
|
|
LCM inventory adjustment
|
26.6
|
|
|
Cost of materials
|
$
|
62.8
|
|
Six months ended June 30, 2019 reported gross profit
|
$
|
68.2
|
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Derivative loss reflected in cost of sales
|
$
|
—
|
|
|
$
|
(2.1
|
)
|
Derivative loss reflected in gross profit
|
$
|
—
|
|
|
$
|
(2.1
|
)
|
|
|
|
|
||||
Realized gain (loss) on derivative instruments
|
$
|
34.2
|
|
|
$
|
(2.1
|
)
|
Unrealized gain (loss) on derivative instruments
|
(14.8
|
)
|
|
2.8
|
|
||
Total derivative gain (loss) reflected in the unaudited condensed consolidated statements of operations
|
$
|
19.4
|
|
|
$
|
(1.4
|
)
|
Total gain (loss) on commodity derivative settlements
|
$
|
34.2
|
|
|
$
|
(2.1
|
)
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Net cash provided by (used in) operating activities
|
$
|
89.6
|
|
|
$
|
(23.3
|
)
|
Net cash provided by (used in) investing activities
|
(3.4
|
)
|
|
4.8
|
|
||
Net cash used in financing activities
|
(68.4
|
)
|
|
(457.0
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
$
|
17.8
|
|
|
$
|
(475.5
|
)
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Capital improvement expenditures
|
$
|
6.5
|
|
|
$
|
15.1
|
|
Replacement capital expenditures
|
7.8
|
|
|
5.8
|
|
||
Environmental capital expenditures
|
5.8
|
|
|
5.8
|
|
||
Turnaround capital expenditures
|
5.7
|
|
|
7.6
|
|
||
Total
|
$
|
25.8
|
|
|
$
|
34.3
|
|
•
|
$600.0 million senior secured revolving credit facility maturing in February 2023, subject to borrowing base limitations, with a maximum letter of credit sublimit equal to $300.0 million, which amount may be increased to 90% of revolver commitments in effect with the consent of the Agent (“revolving credit facility”);
|
•
|
$810.2 million of 6.50% senior notes due 2021 (“2021 Notes”);
|
•
|
$350.0 million of 7.625% senior notes due 2022 (“2022 Notes”); and
|
•
|
$325.0 million of 7.75% senior notes due 2023 (“2023 Notes”).
|
|
|
|
Payments Due by Period
|
||||||||||||||||
|
Total
|
|
Less Than
1 Year |
|
1–3
Years |
|
3–5
Years |
|
More
Than 5 Years |
||||||||||
|
(In millions)
|
||||||||||||||||||
Operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest on long-term debt at contractual rates and maturities (1)
|
$
|
296.1
|
|
|
$
|
108.2
|
|
|
$
|
160.9
|
|
|
$
|
26.9
|
|
|
$
|
0.1
|
|
Operating lease obligations (2)
|
135.2
|
|
|
68.1
|
|
|
49.0
|
|
|
13.3
|
|
|
4.8
|
|
|||||
Letters of credit (3)
|
77.1
|
|
|
77.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Purchase commitments (4)
|
369.5
|
|
|
232.7
|
|
|
42.1
|
|
|
42.1
|
|
|
52.6
|
|
|||||
Employment agreements (5)
|
1.6
|
|
|
1.0
|
|
|
0.6
|
|
|
—
|
|
|
—
|
|
|||||
Financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Obligations under inventory financing agreements
|
126.2
|
|
|
126.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Finance lease obligations
|
3.0
|
|
|
0.5
|
|
|
0.6
|
|
|
0.7
|
|
|
1.2
|
|
|||||
Long-term debt obligations, excluding finance lease obligations
|
1,489.8
|
|
|
1.5
|
|
|
1,163.3
|
|
|
325.0
|
|
|
—
|
|
|||||
Total obligations
|
$
|
2,498.5
|
|
|
$
|
615.3
|
|
|
$
|
1,416.5
|
|
|
$
|
408.0
|
|
|
$
|
58.7
|
|
|
(1)
|
Interest on long-term debt at contractual rates and maturities relates primarily to interest on our senior notes, revolving credit facility interest and fees and interest on our finance lease obligations, which excludes the adjustment for the interest rate swap agreement.
|
(2)
|
We have various operating leases primarily for railcars, the use of land, storage tanks, compressor stations, equipment, precious metals and office facilities that extend through September 2034.
|
(3)
|
Letters of credit primarily supporting crude oil and other feedstock purchases.
|
(4)
|
Purchase commitments consist primarily of obligations to purchase fixed volumes of crude oil, other feedstocks and finished products for resale from various suppliers based on current market prices at the time of delivery.
|
(5)
|
Certain employment agreements may be terminated under certain circumstances or at certain dates prior to expiration. We expect our contracts will be renewed or replaced with similar agreements upon their expiration. Amounts due under the contracts assume the contracts are not terminated prior to their expiration.
|
•
|
crude oil purchases and sales;
|
•
|
refined product sales and purchases;
|
•
|
natural gas purchases;
|
•
|
precious metals; and
|
•
|
fluctuations in the value of crude oil between geographic regions and between the different types of crude oil such as NYMEX WTI, Light Louisiana Sweet, WCS, WTI Midland, Mixed Sweet Blend and ICE Brent.
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
||||||||
|
(In millions)
|
||||||||||||||
Financial Instrument:
|
|
|
|
|
|
|
|
||||||||
2021 Notes
|
$
|
808.6
|
|
|
$
|
806.5
|
|
|
$
|
755.7
|
|
|
$
|
894.7
|
|
2022 Notes
|
$
|
341.3
|
|
|
$
|
346.6
|
|
|
$
|
279.4
|
|
|
$
|
345.9
|
|
2023 Notes
|
$
|
311.4
|
|
|
$
|
320.6
|
|
|
$
|
252.3
|
|
|
$
|
320.1
|
|
•
|
The ineffective design and implementation of effective controls with respect to the implementation of our enterprise resource planning (“ERP”) system consistent with our financial reporting requirements. Specifically, management did not design effective controls over the ERP implementation to ensure appropriate data conversion and data integrity or provide sufficient end user training to our employees to ensure that our employees could effectively operate the system and carry out their responsibilities.
|
•
|
The untimely and insufficient operation of controls in the financial statement close process, including lack of timely account reconciliation, analysis and review related to all financial statement accounts.
|
•
|
We implemented certain additional controls around data management and review to ensure accurate data integrity and change controls, including but not limited to, centralizing the data management function and implementing change controls. As we test the controls around data management, we may make additional changes to our processes or controls to ensure adequate remediation of the material weakness.
|
•
|
We reinforced the importance of our control environment across the Company, we provided additional training to employees to enhance their understanding of processes so they can effectively operate the system and perform the related controls. This training is ongoing and continues to be enhanced.
|
•
|
We will review, analyze and properly document our processes related to internal controls over financial reporting.
|
•
|
We will continue to design and implement effective review and approval controls. These controls will address the accuracy and completeness of the data used in the performance of the respective controls.
|
|
|
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
|
|
|
|
|
|
|
|
By:
|
Calumet GP, LLC, its general partner
|
|
|
|
|
Date:
|
August 8, 2019
|
By:
|
/s/ Christopher H. Bohnert
|
|
|
|
Christopher H. Bohnert
|
|
|
|
Chief Accounting Officer
|
|
|
|
(Authorized Person and Principal Accounting Officer)
|
|
|
|
|
William A. Anderson
|
CALUMET GP, LLC (for itself and on behalf of the Company)
|
1.
|
I have reviewed this Quarterly Report of Calumet Specialty Products Partners, L.P. (the “registrant”) on Form 10-Q for the quarter ended June 30, 2019;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
Date: August 8, 2019
|
|
/s/ Timothy Go
|
|
|
Timothy Go
|
|
|
Chief Executive Officer of Calumet GP, LLC, general partner of Calumet Specialty Products Partners, L.P.
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this Quarterly Report of Calumet Specialty Products Partners, L.P. (the “registrant”) on Form 10-Q for the quarter ended June 30, 2019;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
Date: August 8, 2019
|
|
/s/ D. West Griffin
|
|
|
D. West Griffin
|
|
|
Executive Vice President and Chief Financial Officer of Calumet GP, LLC, general partner of Calumet Specialty Products Partners, L.P.
|
|
|
(Principal Financial Officer)
|
(a)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(b)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.
|
|
|
|
August 8, 2019
|
|
/s/ Timothy Go
|
|
|
Timothy Go
|
|
|
Chief Executive Officer of Calumet GP, LLC, general partner of Calumet Specialty Products Partners, L.P.
|
|
|
(Principal Executive Officer)
|
|
|
|
August 8, 2019
|
|
/s/ D. West Griffin
|
|
|
D. West Griffin
|
|
|
Executive Vice President and Chief Financial Officer of Calumet GP, LLC, general partner of Calumet Specialty Products Partners, L.P.
|
|
|
(Principal Financial Officer)
|