The strength of Magellan Midstream Partners’ terminals assets has exceeded initial expectations over its financial results, the company has announced.
The petroleum products and crude oil company reported net income of $183.6 (€163.4) million for the first quarter 2015 compared to $242.6 (€215.9) million for the same period in 2014.
The company said that the decrease was driven by reduced profits from the partnership’s commodity-related activities, due to lower realised commodity prices on these activities and the timing of mark-to-market pricing adjustments for the related hedging positions, partially offset by higher contributions from Magellan’s core fee-based transportation and terminal activities.
Within its crude oil segment however, the company enjoyed an increase of $21.4 (€19) million and transportation and terminals revenue increased $18.7 (€16.6) million primarily due to increased crude oil shipments on the Longhorn pipeline.
Their marine storage segment saw a decrease in its operating margin of $500,000, however revenue increased primarily due to improved utilisation and higher average storage rates at the partnership’s marine terminals.
Michael Mears, CEO, says: ‘Magellan reported financial results for the first quarter of 2015 that exceeded our initial expectations, bolstered by the strength of our fee-based transportation and terminals assets.
‘Magellan is a strong company on firm financial footing that should be well prepared to weather this challenging time for our industry.
‘Demand for our transportation and terminals service remains solid, and we continue to make significant progress on projects that will serve as our next wave of growth.’