Natural resource partners l.p. reports fourth quarter and full year 2019 results
Houston--(business wire)--natural resource partners l.p. (nyse:nrp) today reported fourth quarter and full year 2019 results as follows: three months ended year ended december 31, december 31, (in thousands) (unaudited) 2019 2018 2019 2018 net income (loss) from continuing operations (1) $ (119,448 ) $ 35,092 $ (25,414 ) $ 122,360 asset impairments 147,730 18,038 148,214 18,280 net income from continuing operations excluding asset impairments (1) $ 28,282 $ 53,130 $ 122,800 $ 140,640 adjusted ebitda (1)(2) 37,974 72,936 199,228 230,241 cash flow provided by (used in) continuing operations: operating activities 19,394 80,489 137,319 178,282 investing activities 259 2,078 8,221 7,607 financing activities (33,551 ) 64,856 (253,305 ) (6,839 ) distributable cash flow (1)(2)(3) 19,602 280,658 144,933 383,980 free cash flow (1)(2) 19,764 80,944 139,040 183,440 cash flow cushion (last twelve months) (2) 7,762 16,080 (1) includes $25.0 million from the hillsboro litigation settlement in nrp's coal royalty and other segment for the three months and year ended december 31, 2018. (2) see "non-gaap financial measures" and reconciliation tables at the end of this release. (3) includes net proceeds from the sale of nrp's construction aggregates business which were classified as investing cash flows from discontinued operations. "despite a weakened coal market, we generated $139 million of free cash flow and repaid $163 million of debt in 2019," said craig nunez, nrp's president and chief operating officer. "we continue to maintain strong cash balances and liquidity, and our efforts to de-lever and de-risk the partnership over the past five years have prepared us to operate through this downturn.” nrp's liquidity was $198.3 million at december 31, 2019, consisting of $98.3 million of cash and $100.0 million of borrowing capacity available under its revolving credit facility. at december 31, 2019, nrp's consolidated debt-to-adjusted ebitda ratio was 2.6x. nrp declared a cash distribution of $0.45 per common unit and a cash distribution of $7.5 million on its preferred units for the fourth quarter of 2019. segment results coal royalty and other nrp's coal royalty and other segment revenues and other income in the fourth quarter and full year 2019 was lower by $35.8 million and $13.4 million, respectively, as compared to the prior year periods primarily due to weakened metallurgical and thermal coal markets in 2019 and the $25 million one-time payment from the hillsboro litigation settlement in the fourth quarter of 2018. these decreases were partially offset by increased minimum lease straight-line revenues primarily related to the hillsboro property that we began to recognize in 2019 after the completion of the hillsboro litigation settlement with foresight. additionally, full year 2019 results benefited from a $15.9 million increase in revenues primarily related to lessee forfeitures of recoupable balances from minimums paid in prior periods. while a number of nrp's lessees went through the bankruptcy process in 2019, there was minimal impact to nrp as bankrupt lessees bad debt expense was offset by increased lease amendment fees associated with bankruptcies. nrp also recorded $147.7 million and $148.2 million in non-cash asset impairment expense in the fourth quarter and full year 2019, respectively, primarily as a result of the deterioration in thermal coal markets, lessee capital constraints and the termination of certain thermal coal leases. approximately 60% and 65% of coal royalty revenues and approximately 45% and 50% of coal royalty sales volumes were derived from metallurgical coal during the three months and year ended december 31, 2019, respectively. soda ash distributions received from ciner wyoming were $6.4 million and $31.9 million in the fourth quarter and full year 2019, respectively, as compared to $9.8 million and $46.6 million in the fourth quarter and full year 2018, respectively. the managing partner of ciner wyoming decided to reduce distributions during the year to fund a multi-year capacity expansion project that is expected to result in higher earnings and distributions. nrp expects to receive approximately $25 million to $28 million of annual cash distributions from ciner wyoming until the project is funded. corporate and financing corporate and financing costs declined $8.4 million in the fourth quarter of 2019 compared to the prior year quarter primarily due to lower interest expense as a result of less debt outstanding. cash paid for interest in the fourth quarter of 2019 increased $15.5 million as compared to the prior year quarter as a result of the timing of interest payments on the parent company bonds that were refinanced in the second quarter of 2019. nrp paid interest on the new 9.125% notes in the fourth quarter of 2019, compared to interest payments made on the previous 10.5% notes in the third quarter of 2018. corporate and financing costs increased $6.8 million in 2019 as compared to the prior year primarily driven by the refinancing of nrp's bonds and revolving credit facility in the second quarter of 2019 which reduced interest costs, extended maturities and significantly improved the partnership's liquidity and financial flexibility. the refinancings resulted in a $29.3 million loss on extinguishment of debt, which was partially offset by $22.7 million decreased interest expense, net of interest income. anadarko litigation update in november 2019, the trial court ruled in nrp’s favor in the contingent purchase price consideration payment lawsuit brought against nrp by anadarko. anadarko did not appeal the trial court’s ruling. accordingly, this case is now concluded with no liability incurred by nrp. conference call a conference call will be held today at 9:00 a.m. et. to join the conference call, dial (844) 583-4546 and provide the conference id 1465967. investors may also listen to the call via the investor relations section of the nrp website at www.nrplp.com. to access the replay, please visit the investor relations section of nrp’s website. company profile natural resource partners l.p., a master limited partnership headquartered in houston, tx, is a diversified natural resource company that owns, manages and leases a diversified portfolio of mineral properties in the united states including interests in coal, industrial minerals and other natural resources. in addition, nrp owns an equity investment in ciner wyoming llc, a trona ore mining and soda ash production business. for additional information, please contact tiffany sammis at 713-751-7515 or tsammis@nrplp.com. further information about nrp is available on the partnership’s website at http://www.nrplp.com. forward-looking statements this press release includes “forward-looking statements” as defined by the securities and exchange commission. all statements, other than statements of historical facts, included in this press release that address activities, events or developments that the partnership expects, believes or anticipates will or may occur in the future are forward-looking statements. these statements are based on certain assumptions made by the partnership based on its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the partnership. these risks include, among other things, statements regarding: the partnership's business strategy; its liquidity and access to capital and financing sources; its financial strategy; prices of and demand for coal, trona and soda ash, and other natural resources; estimated revenues, expenses and results of operations; projected production levels by the partnership's lessees; ciner wyoming llc’s trona mining and soda ash refinery operations; distributions from the soda ash joint venture; the impact of governmental policies, laws and regulations, as well as regulatory and legal proceedings involving the partnership, and of scheduled or potential regulatory or legal changes; global and u.s. economic conditions; and other factors detailed in natural resource partners’ securities and exchange commission filings. natural resource partners l.p. has no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. non-gaap financial measures "adjusted ebitda" is a non-gaap financial measure that we define as net income (loss) from continuing operations less equity earnings from unconsolidated investment, net income attributable to non-controlling interest and gain on reserve swap; plus total distributions from unconsolidated investment, interest expense, net, debt modification expense, loss on extinguishment of debt, depreciation, depletion and amortization and asset impairments. adjusted ebitda should not be considered an alternative to, or more meaningful than, net income or loss, net income or loss attributable to partners, operating income or loss, cash flows from operating activities or any other measure of financial performance presented in accordance with gaap as measures of operating performance, liquidity or ability to service debt obligations. there are significant limitations to using adjusted ebitda as a measure of performance, including the inability to analyze the effect of certain recurring items that materially affect our net income (loss), the lack of comparability of results of operations of different companies and the different methods of calculating adjusted ebitda reported by different companies. in addition, adjusted ebitda presented below is not calculated or presented on the same basis as consolidated ebitda as defined in our partnership agreement or consolidated ebitdda as defined in opco's debt agreements. adjusted ebitda is a supplemental performance measure used by our management and by external users of our financial statements, such as investors, commercial banks, research analysts and others to assess the financial performance of our assets without regard to financing methods, capital structure or historical cost basis. “distributable cash flow” or "dcf" is a non-gaap financial measure that we define as net cash provided by (used in) operating activities of continuing operations plus distributions from unconsolidated investment in excess of cumulative earnings, proceeds from asset sales and disposals, including sales of discontinued operations, and return of long-term contract receivable; less maintenance capital expenditures and distributions to non-controlling interest. dcf is not a measure of financial performance under gaap and should not be considered as an alternative to cash flows from operating, investing or financing activities. dcf may not be calculated the same for us as for other companies. in addition, distributable cash flow is not calculated or presented on the same basis as distributable cash flow as defined in our partnership agreement, which is used as a metric to determine whether we are able to increase quarterly distributions to our common unitholders. distributable cash flow is a supplemental liquidity measure used by our management and by external users of our financial statements, such as investors, commercial banks, research analysts and others to assess our ability to make cash distributions and repay debt. “free cash flow” or "fcf" is a non-gaap financial measure that we define as net cash provided by (used in) operating activities of continuing operations plus distributions from unconsolidated investment in excess of cumulative earnings and return of long-term contract receivable; less maintenance and expansion capital expenditures, cash flow used in acquisition costs classified as financing activities and distributions to non-controlling interest. fcf is calculated before mandatory debt repayments. free cash flow is not a measure of financial performance under gaap and should not be considered as an alternative to cash flows from operating, investing or financing activities. free cash flow may not be calculated the same for us as for other companies. free cash flow is a supplemental liquidity measure used by our management and by external users of our financial statements, such as investors, commercial banks, research analysts and others to assess our ability to make cash distributions and repay debt. "cash flow cushion" is a non-gaap financial measure that we define as free cash flow less one-time beneficial items, mandatory opco debt repayments, preferred unit distributions and common unit distributions. cash flow cushion is not a measure of financial performance under gaap and should not be considered as an alternative to cash flows from operating, investing or financing activities. cash flow cushion is a supplemental liquidity measure used by our management to assess the partnership's ability to make or raise cash distributions to our common and preferred unitholders and our general partner and repay debt or redeem preferred units. "return on capital employed" or "roce" is a non-gaap financial measure that we define as net income (loss) from continuing operations plus financing costs (interest expense plus loss on extinguishment of debt) divided by the sum of equity excluding equity of discontinued operations, and debt. return on capital employed should not be considered an alternative to, or more meaningful than, net income or loss, net income or loss attributable to partners, operating income or loss, cash flows from operating activities or any other measure of financial performance presented in accordance with gaap as measures of operating performance, liquidity or ability to service debt obligations. return on capital employed is a supplemental performance measure used by our management team that measures our profitability and efficiency with which our capital is employed. the measure provides an indication of operating performance before the impact of leverage in the capital structure. -financial tables and reconciliation of non-gaap measures follow- natural resource partners l.p. financial tables (unaudited) consolidated statements of comprehensive income (loss) three months ended year ended december 31, september 30, december 31, (in thousands, except per unit data) 2019 2018 2019 2019 2018 revenues and other income coal royalty and other $ 37,032 $ 43,966 $ 39,919 $ 191,069 $ 178,878 transportation and processing services 4,539 6,649 3,865 19,279 23,887 equity in earnings of ciner wyoming 10,256 13,320 13,818 47,089 48,306 gain on litigation settlement — 25,000 — — 25,000 gain (loss) on asset sales and disposals (111 ) 1,622 6,107 6,498 2,441 total revenues and other income $ 51,716 $ 90,557 $ 63,709 $ 263,935 $ 278,512 operating expenses operating and maintenance expenses $ 5,925 $ 8,387 $ 5,994 $ 32,738 $ 29,509 depreciation, depletion and amortization 3,186 6,325 3,384 14,932 21,689 general and administrative expenses 3,931 5,714 4,253 16,730 16,496 asset impairments 147,730 18,038 484 148,214 18,280 total operating expenses $ 160,772 $ 38,464 $ 14,115 $ 212,614 $ 85,974 income (loss) from operations $ (109,056 ) $ 52,093 $ 49,594 $ 51,321 $ 192,538 other expenses, net interest expense, net $ (10,392 ) $ (17,001 ) $ (10,431 ) $ (47,453 ) $ (70,178 ) loss on extinguishment of debt — — — (29,282 ) — total other expenses, net $ (10,392 ) $ (17,001 ) $ (10,431 ) $ (76,735 ) $ (70,178 ) net income (loss) from continuing operations $ (119,448 ) $ 35,092 $ 39,163 $ (25,414 ) $ 122,360 income from discontinued operations 750 13,966 7 956 17,687 net income (loss) $ (118,698 ) $ 49,058 $ 39,170 $ (24,458 ) $ 140,047 net income attributable to non-controlling interest — — — — (510 ) net income (loss) attributable to nrp $ (118,698 ) $ 49,058 $ 39,170 $ (24,458 ) $ 139,537 less: income attributable to preferred unitholders (7,500 ) (7,500 ) (7,500 ) (30,000 ) (30,000 ) net income (loss) attributable to common unitholders and general partner $ (126,198 ) $ 41,558 $ 31,670 $ (54,458 ) $ 109,537 net income (loss) attributable to common unitholders $ (123,674 ) $ 40,727 $ 31,036 $ (53,369 ) $ 107,346 net income (loss) attributable to the general partner (2,524 ) 831 634 (1,089 ) 2,191 income (loss) from continuing operations per common unit basic $ (10.15 ) $ 2.21 $ 2.53 $ (4.43 ) $ 7.35 diluted (10.15 ) 1.69 1.66 (4.43 ) 5.90 net income (loss) per common unit basic $ (10.09 ) $ 3.33 $ 2.53 $ (4.35 ) $ 8.77 diluted (10.09 ) 2.36 1.66 (4.35 ) 6.76 net income (loss) $ (118,698 ) $ 49,058 $ 39,170 $ (24,458 ) $ 140,047 comprehensive income (loss) from unconsolidated investment and other 1,208 619 (520 ) 868 (149 ) comprehensive income (loss) $ (117,490 ) $ 49,677 $ 38,650 $ (23,590 ) $ 139,898 comprehensive income attributable to non-controlling interest — — — — (510 ) comprehensive income (loss) attributable to nrp $ (117,490 ) $ 49,677 $ 38,650 $ (23,590 ) $ 139,388 natural resource partners l.p. financial tables (unaudited) consolidated statements of cash flows three months ended year ended december 31, september 30, december 31, (in thousands) 2019 2018 2019 2019 2018 cash flows from operating activities net income (loss) $ (118,698 ) $ 49,058 $ 39,170 $ (24,458 ) $ 140,047 adjustments to reconcile net income (loss) to net cash provided by operating activities of continuing operations: depreciation, depletion and amortization 3,186 6,325 3,384 14,932 21,689 distributions from unconsolidated investment 6,370 9,800 6,370 31,850 44,453 equity earnings from unconsolidated investment (10,256 ) (13,320 ) (13,818 ) (47,089 ) (48,306 ) loss (gain) on asset sales and disposals 111 (1,622 ) (6,107 ) (6,498 ) (2,441 ) loss on extinguishment of debt — — — 29,282 — income from discontinued operations (750 ) (13,966 ) (7 ) (956 ) (17,687 ) asset impairments 147,730 18,038 484 148,214 18,280 bad debt expense 620 (302 ) 151 7,462 (62 ) unit-based compensation expense 519 290 466 2,361 1,434 amortization of debt issuance costs and other 464 3,112 1,072 3,687 7,133 change in operating assets and liabilities: accounts receivable (3,924 ) 461 996 (6,035 ) (6,062 ) accounts payable (412 ) 1,048 355 (1,234 ) 1,138 accrued liabilities 1,427 3,212 439 (3,656 ) 19 accrued interest (12,048 ) 8,806 7,163 (12,029 ) (1,138 ) deferred revenue 3,188 10,265 (1,236 ) (732 ) 19,465 other items, net 1,867 (716 ) 2,852 2,218 320 net cash provided by operating activities of continuing operations $ 19,394 $ 80,489 $ 41,734 $ 137,319 $ 178,282 net cash provided by (used in) operating activities of discontinued operations (4 ) 886 (359 ) (8 ) 10,641 net cash provided by operating activities $ 19,390 $ 81,375 $ 41,375 $ 137,311 $ 188,923 cash flows from investing activities distributions from unconsolidated investment in excess of cumulative earnings $ — $ — $ — $ — $ 2,097 proceeds from asset sales and disposals (111 ) 1,623 6,108 6,500 2,449 return of long-term contract receivable 392 455 459 1,743 3,061 acquisition of mineral rights (22 ) — — (22 ) — net cash provided by investing activities of continuing operations $ 259 $ 2,078 $ 6,567 $ 8,221 $ 7,607 net cash provided by (used in) investing activities of discontinued operations (73 ) 192,364 (122 ) (629 ) 183,021 net cash provided by investing activities $ 186 $ 194,442 $ 6,445 $ 7,592 $ 190,628 cash flows from financing activities debt borrowings — — — 300,000 35,000 debt repayments (20,335 ) (119,986 ) (8,277 ) (463,082 ) (175,706 ) redemption of preferred units paid-in-kind — — — — (8,844 ) distributions to common unitholders and general partner (5,630 ) (5,623 ) (5,630 ) (33,150 ) (22,486 ) distributions to preferred unitholders (7,500 ) (7,500 ) (7,500 ) (30,000 ) (30,265 ) contributions from (to) discontinued operations (77 ) 197,965 (481 ) (637 ) 195,690 debt issuance costs and other (9 ) — (25 ) (26,436 ) (228 ) net cash provided by (used in) financing activities of continuing operations $ (33,551 ) $ 64,856 $ (21,913 ) $ (253,305 ) $ (6,839 ) net cash provided by (used in) financing activities of discontinued operations 77 (198,030 ) 481 637 (196,509 ) net cash used in financing activities $ (33,474 ) $ (133,174 ) $ (21,432 ) $ (252,668 ) $ (203,348 ) net increase (decrease) in cash, cash equivalents and restricted cash $ (13,898 ) $ 142,643 $ 26,388 $ (107,765 ) $ 176,203 cash, cash equivalents and restricted cash of continuing operations at beginning of period $ 112,163 $ 58,607 $ 85,775 $ 206,030 $ 26,980 cash and cash equivalents of discontinued operations at beginning of period — 4,780 — — 2,847 cash, cash equivalents and restricted cash at beginning of period $ 112,163 $ 63,387 $ 85,775 $ 206,030 $ 29,827 cash, cash equivalents and restricted cash at end of period $ 98,265 $ 206,030 $ 112,163 $ 98,265 $ 206,030 less: cash and cash equivalents of discontinued operations at end of period — — — — — cash, cash equivalents and restricted cash of continuing operations at end of period $ 98,265 $ 206,030 $ 112,163 $ 98,265 $ 206,030 supplemental cash flow information: cash paid during the period for interest of continuing operations $ 22,327 $ 6,838 $ 3,225 $ 58,597 $ 64,991 natural resource partners l.p. financial tables (unaudited) consolidated balance sheets december 31, (in thousands, except unit data) 2019 2018 assets current assets cash and cash equivalents $ 98,265 $ 101,839 restricted cash — 104,191 accounts receivable, net 30,869 32,058 prepaid expenses and other, net 1,244 3,462 current assets of discontinued operations 1,706 993 total current assets $ 132,084 $ 242,543 land 24,008 24,008 mineral rights, net 605,096 743,112 intangible assets, net 17,687 42,513 equity in unconsolidated investment 263,080 247,051 long-term contract receivable 36,963 38,945 other assets, net 6,989 3,475 total assets $ 1,085,907 $ 1,341,647 liabilities and capital current liabilities accounts payable $ 1,179 $ 2,414 accrued liabilities 8,764 12,347 accrued interest 2,316 14,345 current portion of deferred revenue 4,608 3,509 current portion of long-term debt, net 45,776 115,184 current liabilities of discontinued operations 65 947 total current liabilities $ 62,708 $ 148,746 deferred revenue 47,213 49,044 long-term debt, net 470,422 557,574 other non-current liabilities 4,949 1,150 total liabilities $ 585,292 $ 756,514 commitments and contingencies class a convertible preferred units (250,000 units issued and outstanding at $1,000 par value per unit; liquidation preference of $1,500 per unit) $ 164,587 $ 164,587 partners’ capital: common unitholders’ interest (12,261,199 and 12,249,469 units issued and outstanding at december 31, 2019 and 2018, respectively) $ 271,471 $ 355,113 general partner’s interest 3,270 5,014 warrant holders' interest 66,816 66,816 accumulated other comprehensive loss (2,594 ) (3,462 ) total partners’ capital $ 338,963 $ 423,481 non-controlling interest (2,935 ) (2,935 ) total capital $ 336,028 $ 420,546 total liabilities and capital $ 1,085,907 $ 1,341,647 natural resource partners l.p. financial tables (unaudited) consolidated statements of partners' capital common unitholders general partner warrant holders accumulated other comprehensive loss partners' capital excluding non- controlling interest non- controlling interest total capital (in thousands) units amounts balance at december 31, 2017 12,232 $ 199,851 $ 1,857 $ 66,816 $ (3,313 ) $ 265,211 $ (3,394 ) $ 261,817 cumulative effect of adoption of accounting standard — 69,057 1,409 — — 70,466 — 70,466 net income (1) — 136,746 2,791 — — 139,537 510 140,047 distributions to common unitholders and general partner — (22,036 ) (450 ) — — (22,486 ) — (22,486 ) distributions to preferred unitholders — (29,660 ) (605 ) — — (30,265 ) — (30,265 ) issuance of unit-based awards 17 546 — — — 546 — 546 unit-based awards amortization and vesting — 560 — — — 560 — 560 comprehensive income (loss) from unconsolidated investment and other — 49 12 — (149 ) (88 ) (51 ) (139 ) balance at december 31, 2018 12,249 $ 355,113 $ 5,014 $ 66,816 $ (3,462 ) $ 423,481 $ (2,935 ) $ 420,546 net loss (1) — (23,969 ) (489 ) — — (24,458 ) — (24,458 ) distributions to common unitholders and general partner — (32,487 ) (663 ) — — (33,150 ) — (33,150 ) distributions to preferred unitholders — (29,400 ) (600 ) — — (30,000 ) — (30,000 ) issuance of unit-based awards 12 486 — — — 486 — 486 unit-based awards amortization and vesting — 1,804 — — — 1,804 — 1,804 comprehensive income (loss) from unconsolidated investment and other — (76 ) 8 — 868 800 — 800 balance at december 31, 2019 12,261 $ 271,471 $ 3,270 $ 66,816 $ (2,594 ) $ 338,963 $ (2,935 ) $ 336,028 (1) net income (loss) includes $30.0 million attributable to preferred unitholders that accumulated during the period, of which $29.4 million is allocated to the common unitholders and $0.6 million is allocated to the general partner. natural resource partners l.p. financial tables (unaudited) the following tables present nrp's unaudited business results by segment for the three months ended december 31, 2019 and 2018 and september 30, 2019: operating business segments coal royalty and other corporate and financing (in thousands) soda ash total three months ended december 31, 2019 revenues $ 41,571 $ 10,256 $ — $ 51,827 loss on asset sales and disposals (111 ) — — (111 ) total revenues and other income $ 41,460 $ 10,256 $ — $ 51,716 asset impairments $ 147,730 $ — $ — $ 147,730 net income (loss) from continuing operations $ (115,355 ) $ 10,230 $ (14,323 ) $ (119,448 ) adjusted ebitda (1) $ 35,561 $ 6,344 $ (3,931 ) $ 37,974 cash flow provided by (used in) continuing operations: operating activities $ 39,042 $ 6,344 $ (25,992 ) $ 19,394 investing activities $ 259 $ — $ — $ 259 financing activities $ — $ — $ (33,551 ) $ (33,551 ) distributable cash flow (1) (2) $ 39,323 $ 6,344 $ (25,992 ) $ 19,602 free cash flow (1) $ 39,412 $ 6,344 $ (25,992 ) $ 19,764 three months ended december 31, 2018 revenues $ 50,615 $ 13,320 $ — $ 63,935 gain on litigation settlement 25,000 — — 25,000 gain on asset sales and disposals 1,622 — — 1,622 total revenues and other income $ 77,237 $ 13,320 $ — $ 90,557 asset impairments $ 18,038 $ — $ — $ 18,038 net income (loss) from continuing operations $ 44,487 $ 13,320 $ (22,715 ) $ 35,092 adjusted ebitda (1) $ 68,850 $ 9,800 $ (5,714 ) $ 72,936 cash flow provided by (used in) continuing operations: operating activities $ 80,272 $ 9,800 $ (9,583 ) $ 80,489 investing activities $ 2,078 $ — $ — $ 2,078 financing activities $ — $ — $ 64,856 $ 64,856 distributable cash flow (1) (2) $ 82,350 $ 9,800 $ (9,583 ) $ 280,658 free cash flow (1) $ 80,727 $ 9,800 $ (9,583 ) $ 80,944 three months ended september 30, 2019 revenues $ 43,784 $ 13,818 $ — $ 57,602 gain on asset sales and disposals 6,107 — — 6,107 total revenues and other income $ 49,891 $ 13,818 $ — $ 63,709 asset impairments $ 484 $ — $ — $ 484 net income (loss) from continuing operations $ 40,252 $ 13,595 $ (14,684 ) $ 39,163 adjusted ebitda (1) $ 44,120 $ 6,147 $ (4,253 ) $ 46,014 cash flow provided by (used in) continuing operations: operating activities $ 41,094 $ 6,147 $ (5,507 ) $ 41,734 investing activities $ 6,567 $ — $ — $ 6,567 financing activities $ — $ — $ (21,913 ) $ (21,913 ) distributable cash flow (1) (2) $ 47,661 $ 6,147 $ (5,507 ) $ 48,179 free cash flow (1) $ 41,553 $ 6,147 $ (5,507 ) $ 42,193 (1) see "non-gaap financial measures" and reconciliation tables at the end of this release. (2) includes net proceeds from the sale of the construction aggregates business which are classified as investing cash flow from discontinued operations. natural resource partners l.p. financial tables (unaudited) the following tables present nrp's unaudited business results by segment for the year ended december 31, 2019 and 2018: operating business segments coal royalty and other corporate and financing (in thousands) soda ash total year ended december 31, 2019 revenues $ 210,348 $ 47,089 $ — $ 257,437 gain on asset sales and disposals 6,498 — — 6,498 total revenues and other income $ 216,846 $ 47,089 $ — $ 263,935 asset impairments $ 148,214 $ — $ — $ 148,214 net income (loss) from continuing operations $ 21,211 $ 46,840 $ (93,465 ) $ (25,414 ) adjusted ebitda (1) $ 184,357 $ 31,601 $ (16,730 ) $ 199,228 cash flow provided by (used in) continuing operations: operating activities $ 178,863 $ 31,601 $ (73,145 ) $ 137,319 investing activities $ 8,221 $ — $ — $ 8,221 financing activities $ — $ — $ (253,305 ) $ (253,305 ) distributable cash flow (1) (2) $ 187,106 $ 31,601 $ (73,145 ) $ 144,933 free cash flow (1) $ 180,584 $ 31,601 $ (73,145 ) $ 139,040 year ended december 31, 2018 revenues $ 202,765 $ 48,306 $ — $ 251,071 gain on litigation settlement 25,000 — — 25,000 gain on asset sales and disposals 2,441 — — 2,441 total revenues and other income $ 230,206 $ 48,306 $ — $ 278,512 asset impairments $ 18,280 $ — $ — $ 18,280 net income (loss) from continuing operations $ 160,728 $ 48,306 $ (86,674 ) $ 122,360 adjusted ebitda (1) $ 200,187 $ 46,550 $ (16,496 ) $ 230,241 cash flow provided by (used in) continuing operations: operating activities $ 212,394 $ 44,453 $ (78,565 ) $ 178,282 investing activities $ 5,510 $ 2,097 $ — $ 7,607 financing activities $ — $ — $ (6,839 ) $ (6,839 ) distributable cash flow (1) (2) $ 217,904 $ 46,550 $ (78,565 ) $ 383,980 free cash flow (1) $ 215,455 $ 46,550 $ (78,565 ) $ 183,440 (1) see "non-gaap financial measures" and reconciliation tables at the end of this release. (2) includes net proceeds from the sale of the construction aggregates business which are classified as investing cash flow from discontinued operations. natural resource partners l.p. financial tables (unaudited) operating statistics - coal royalty and other three months ended year ended december 31, september 30, december 31, (in thousands, except per ton data) 2019 2018 2019 2019 2018 coal sales volumes (tons) appalachia northern (1) 686 1,697 290 3,460 3,187 central 2,908 3,415 3,222 13,377 14,997 southern 498 422 438 1,670 1,710 total appalachia 4,092 5,534 3,950 18,507 19,894 illinois basin 555 648 551 2,201 2,739 northern powder river basin 1,057 1,417 532 3,036 4,313 total coal sales volumes 5,704 7,599 5,033 23,744 26,946 coal royalty revenue per ton appalachia northern (1) $ 0.88 $ 1.78 $ 2.54 $ 1.96 $ 2.74 central 4.58 5.79 5.25 5.53 5.62 southern 5.96 7.89 5.99 6.69 7.20 illinois basin 4.53 4.84 4.82 4.66 4.63 northern powder river basin 2.33 2.56 4.69 2.90 2.65 combined average coal royalty revenue per ton 3.84 4.33 5.05 4.67 4.80 coal royalty revenues appalachia northern (1) $ 602 $ 3,021 $ 735 $ 6,775 $ 8,719 central 13,332 19,764 16,929 73,960 84,302 southern 2,965 3,327 2,626 11,169 12,312 total appalachia 16,899 26,112 20,290 91,904 105,333 illinois basin 2,516 3,140 2,658 10,255 12,673 northern powder river basin 2,462 3,628 2,492 8,809 11,445 unadjusted coal royalty revenues 21,877 32,880 25,440 110,968 129,451 coal royalty adjustment for minimum leases 174 (12 ) (713 ) (1,356 ) (110 ) total coal royalty revenues $ 22,051 $ 32,868 $ 24,727 $ 109,612 $ 129,341 other revenues production lease minimum revenues $ 2,737 $ 1,897 $ 2,752 $ 24,068 $ 8,207 minimum lease straight-line revenues 3,758 623 3,982 14,910 2,362 property tax revenues 1,871 1,454 1,606 6,287 5,422 wheelage revenues 845 1,329 1,675 5,880 6,484 coal overriding royalty revenues 3,333 3,386 2,189 13,496 13,878 lease amendment revenues 1,271 — 1,535 7,991 — aggregates royalty revenues 610 1,188 954 4,265 4,739 oil and gas royalty revenues 456 929 374 3,031 6,608 other revenues 100 292 125 1,529 1,837 total other revenues $ 14,981 $ 11,098 $ 15,192 $ 81,457 $ 49,537 coal royalty and other $ 37,032 $ 43,966 $ 39,919 $ 191,069 $ 178,878 transportation and processing services revenues 4,539 6,649 3,865 19,279 23,887 gain on litigation settlement — 25,000 — — 25,000 gain (loss) on asset sales and disposals (111 ) 1,622 6,107 6,498 2,441 total coal royalty and other segment revenues and other income $ 41,460 $ 77,237 $ 49,891 $ 216,846 $ 230,206 (1) northern appalachia includes nrp's hibbs run property that has significant sales volumes, but a low fixed rate per ton. natural resource partners l.p. reconciliation of non-gaap measures (unaudited) adjusted ebitda coal royalty and other corporate and financing (in thousands) soda ash total three months ended december 31, 2019 net income (loss) from continuing operations $ (115,355 ) $ 10,230 $ (14,323 ) $ (119,448 ) less: equity earnings from unconsolidated investment — (10,256 ) — (10,256 ) add: total distributions from unconsolidated investment — 6,370 — 6,370 add: interest expense, net — — 10,392 10,392 add: depreciation, depletion and amortization 3,186 — — 3,186 add: asset impairments 147,730 — — 147,730 adjusted ebitda $ 35,561 $ 6,344 $ (3,931 ) $ 37,974 three months ended december 31, 2018 net income (loss) from continuing operations $ 44,487 $ 13,320 $ (22,715 ) $ 35,092 less: equity earnings from unconsolidated investment — (13,320 ) — (13,320 ) add: total distributions from unconsolidated investment — 9,800 — 9,800 add: interest expense, net — — 17,001 17,001 add: depreciation, depletion and amortization 6,325 — — 6,325 add: asset impairments 18,038 — — 18,038 adjusted ebitda $ 68,850 $ 9,800 $ (5,714 ) $ 72,936 three months ended september 30, 2019 net income (loss) from continuing operations $ 40,252 $ 13,595 $ (14,684 ) $ 39,163 less: equity earnings from unconsolidated investment — (13,818 ) — (13,818 ) add: total distributions from unconsolidated investment — 6,370 — 6,370 add: interest expense, net — — 10,431 10,431 add: depreciation, depletion and amortization 3,384 — — 3,384 add: asset impairments 484 — — 484 adjusted ebitda $ 44,120 $ 6,147 $ (4,253 ) $ 46,014 natural resource partners l.p. reconciliation of non-gaap measures (unaudited) adjusted ebitda coal royalty and other corporate and financing (in thousands) soda ash total year ended december 31, 2019 net income (loss) from continuing operations $ 21,211 $ 46,840 $ (93,465 ) $ (25,414 ) less: equity earnings from unconsolidated investment — (47,089 ) — (47,089 ) less: net income attributable to non-controlling interest — — — — add: total distributions from unconsolidated investment — 31,850 — 31,850 add: interest expense, net — — 47,453 47,453 add: loss on extinguishment of debt — — 29,282 29,282 add: depreciation, depletion and amortization 14,932 — — 14,932 add: asset impairments 148,214 — — 148,214 adjusted ebitda $ 184,357 $ 31,601 $ (16,730 ) $ 199,228 year ended december 31, 2018 net income (loss) from continuing operations $ 160,728 $ 48,306 $ (86,674 ) $ 122,360 less: equity earnings from unconsolidated investment — (48,306 ) — (48,306 ) less: net income attributable to non-controlling interest (510 ) — — (510 ) add: total distributions from unconsolidated investment — 46,550 — 46,550 add: interest expense, net — — 70,178 70,178 add: loss on extinguishment of debt — — — — add: depreciation, depletion and amortization 21,689 — — 21,689 add: asset impairments 18,280 — — 18,280 adjusted ebitda $ 200,187 $ 46,550 $ (16,496 ) $ 230,241 natural resource partners l.p. reconciliation of non-gaap measures (unaudited) distributable cash flow and free cash flow coal royalty and other corporate and financing (in thousands) soda ash total three months ended december 31, 2019 net cash provided by (used in) operating activities of continuing operations $ 39,042 $ 6,344 $ (25,992 ) 19,394 add: proceeds from asset sales and disposals (111 ) — — (111 ) add: proceeds from sale of discontinued operations — — — (73 ) add: return of long-term contract receivable 392 — — 392 distributable cash flow $ 39,323 $ 6,344 $ (25,992 ) $ 19,602 less: proceeds from asset sales and disposals 111 — — 111 less: proceeds from sale of discontinued operations — — — 73 less: expansion capital expenditures (22 ) — — (22 ) free cash flow $ 39,412 $ 6,344 $ (25,992 ) $ 19,764 three months ended december 31, 2018 net cash provided by (used in) operating activities of continuing operations $ 80,272 $ 9,800 $ (9,583 ) $ 80,489 add: proceeds from asset sales and disposals 1,623 — — 1,623 add: proceeds from sale of discontinued operations — — — 198,091 add: return of long-term contract receivable 455 — — 455 distributable cash flow $ 82,350 $ 9,800 $ (9,583 ) $ 280,658 less: proceeds from asset sales and disposals (1,623 ) — — (1,623 ) less: proceeds from sale of discontinued operations — — — (198,091 ) less: expansion capital expenditures — — — — free cash flow $ 80,727 $ 9,800 $ (9,583 ) $ 80,944 three months ended september 30, 2019 net cash provided by (used in) operating activities of continuing operations $ 41,094 $ 6,147 $ (5,507 ) $ 41,734 add: proceeds from asset sales and disposals 6,108 — — 6,108 add: proceeds from sale of discontinued operations — — — (122 ) add: return of long-term contract receivable 459 — — 459 distributable cash flow $ 47,661 $ 6,147 $ (5,507 ) $ 48,179 less: proceeds from asset sales and disposals (6,108 ) — — (6,108 ) less: proceeds from sale of discontinued operations — — — 122 less: expansion capital expenditures — — — — free cash flow $ 41,553 $ 6,147 $ (5,507 ) $ 42,193 natural resource partners l.p. reconciliation of non-gaap measures (unaudited) distributable cash flow and free cash flow coal royalty and other corporate and financing (in thousands) soda ash total year ended december 31, 2019 net cash provided by (used in) operating activities of continuing operations $ 178,863 $ 31,601 $ (73,145 ) $ 137,319 add: distributions from unconsolidated investment in excess of cumulative earnings — — — — add: proceeds from asset sales and disposals 6,500 — — 6,500 add: proceeds from sale of discontinued operations — — — (629 ) add: return of long-term contract receivable 1,743 — — 1,743 distributable cash flow $ 187,106 $ 31,601 $ (73,145 ) $ 144,933 less: proceeds from asset sales and disposals (6,500 ) — — (6,500 ) less: proceeds from sale of discontinued operations — — — 629 less: expansion capital expenditures (22 ) — — (22 ) free cash flow $ 180,584 $ 31,601 $ (73,145 ) $ 139,040 year ended december 31, 2018 net cash provided by (used in) operating activities of continuing operations $ 212,394 $ 44,453 $ (78,565 ) $ 178,282 add: distributions from unconsolidated investment in excess of cumulative earnings — 2,097 — 2,097 add: proceeds from asset sales and disposals 2,449 — — 2,449 add: proceeds from sale of discontinued operations — — — 198,091 add: return of long-term contract receivable 3,061 — — 3,061 distributable cash flow $ 217,904 $ 46,550 $ (78,565 ) $ 383,980 less: proceeds from asset sales and disposals (2,449 ) — — (2,449 ) less: proceeds from sale of discontinued operations — — — (198,091 ) less: expansion capital expenditures — — — — free cash flow $ 215,455 $ 46,550 $ (78,565 ) $ 183,440 free cash flow excluding discontinued operations and one-time beneficial items and cash flow cushion year ended december 31, (in thousands) 2019 2018 free cash flow $ 139,040 $ 183,440 less: free cash flow used by discontinued operations (8 ) (540 ) free cash flow including discontinued operations $ 139,032 $ 182,900 add: free cash flow used by discontinued operations 8 540 less: cash flow from one-time hillsboro litigation settlement — (25,000 ) free cash flow excluding discontinued operations $ 139,040 $ 158,440 less: mandatory opco debt repayments (68,128 ) (80,765 ) less: preferred unit distributions and redemption of pik units (30,000 ) (39,109 ) less: common unit distributions (33,150 ) (22,486 ) cash flow cushion $ 7,762 $ 16,080 natural resource partners l.p. reconciliation of non-gaap measures (unaudited) leverage ratio (in thousands) year ended december 31, 2019 adjusted ebitda $ 199,228 debt—at december 31, 2019 $ 524,056 leverage ratio (1) 2.6 x (1) leverage ratio is calculated as the outstanding principal of nrp's debt as of december 31, 2019 divided by the last twelve months' adjusted ebitda. return on capital employed ("roce") coal royalty and other corporate and financing (in thousands) soda ash total ltm ended december 31, 2019 net income (loss) from continuing operations $ 21,211 $ 46,840 $ (93,465 ) $ (25,414 ) financing costs — — 79,361 79,361 return $ 21,211 $ 46,840 $ (14,104 ) $ 53,947 as of december 31, 2018 total assets of continuing operations $ 986,680 $ 247,051 $ 106,923 $ 1,340,654 less: total current liabilities of continuing operations excluding current debt (12,604 ) — (20,011 ) (32,615 ) less: total long-term liabilities of continuing operations excluding long-term debt (50,119 ) — (75 ) (50,194 ) capital employed excluding discontinued operations $ 923,957 $ 247,051 $ 86,837 $ 1,257,845 total partners' capital (1) $ 926,892 $ 247,051 $ (750,508 ) $ 423,481 less: non-controlling interest (2,935 ) — — (2,935 ) less: partners' capital from discontinued operations — — — (46 ) total partners' capital excluding discontinued operations $ 923,957 $ 247,051 $ (750,508 ) $ 420,500 class a convertible preferred units — — 164,587 164,587 debt — — 672,758 672,758 capital employed excluding discontinued operations $ 923,957 $ 247,051 $ 86,837 $ 1,257,845 roce excluding discontinued operations 2.3% 19.0% n/a 4.3% excluding asset impairments: return $ 21,211 $ 46,840 $ (14,104 ) $ 53,947 add: asset impairments 148,214 — — 148,214 return excluding asset impairments $ 169,425 $ 46,840 $ (14,104 ) $ 202,161 roce excluding discontinued operations and asset impairments 18.3% 19.0% n/a 16.1% (1) total partners' capital includes $0.05 million from discontinued operations. natural resource partners l.p. reconciliation of non-gaap measures (unaudited) change in common unitholders' equity excluding asset impairments attributable to common unitholders (in thousands) 2019 common unitholders' equity $ 271,471 2018 common unitholders' equity 355,113 2019 change in common unitholders' equity $ (83,642 ) 2019 asset impairments $ 148,214 2019 asset impairments attributable to common unitholders $ 145,250 2019 change in common unitholders' equity excluding asset impairments attributable to common unitholders $ 61,608
