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TC PipeLines, LP Announces Third Quarter Results
CALGARY, Alberta - October 24, 2003 - (Nasdaq: TCLP) - TC PipeLines, LP (the Partnership) today reported third quarter 2003 net income of $12.0 million or $0.65 per unit (all amounts in U.S. dollars) compared to $12.5 million or $0.68 per unit in third quarter 2002. For the nine months ended September 30, 2003, the Partnership reported net income of $35.9 million or $1.97 per unit compared to $36.6 million or $2.01 per unit for the same period last year.
The Partnership's third quarter 2003 cash generated from operations amounted to $12.8 million, compared to third quarter 2002 cash generated from operations of $13.4 million. For the nine months ended September 30, 2003, cash generated from operations amounted to $37.2 million compared to $38.6 million for the same period last year. The decrease in 2003 cash generated from operations reflects lower cash flows from Northern Border Pipeline Company, due to higher electricity costs as well as refunds paid by Northern Border Pipeline to its shippers for electricity costs that had been previously collected through company use gas provisions. The impact of this decrease was partially offset by increased cash flows from Tuscarora Gas Transmission Company resulting from the 2002 expansion.
"This has been another good quarter for the Partnership," said Ron Turner, President and Chief Executive Officer of the general partner, TC PipeLines GP, Inc. "We are pleased that our assets continue to generate the kind of stable and consistent cash flows our unitholders have come to expect from TC PipeLines." On October 21, 2003, the Partnership announced its third quarter cash distribution in the amount of $0.55 per unit.
Financial Highlights (unaudited)
(millions of U.S. dollars, except per unit amounts)
|
Three months ended December 31 |
Twelve months ended December 31 |
| |
2003 |
2002 |
2003 |
2002 |
| Net Income |
12.0 |
12.5 |
35.9 |
36.6 |
| Per unit (1) |
$0.65 |
$0.68 |
$1.97 |
$2.01 |
| Cash Generated from Operations |
12.8 |
13.4 |
37.2 |
38.6 |
| Cash Distributions Paid |
10.1 |
9.6 |
29.3 |
27.7 |
| Net Income |
12.1 |
8.9 |
48.0 |
45.5 |
| Cash Distributions Declared per Unit (2) |
$0.55 |
$0.525 |
$1.625 |
$1.550 |
| Units Outstanding (millions) |
17.5 |
17.5 |
17.5 |
17.5 |
Net Income
The Partnership reported third quarter 2003 net income of $12.0 million or $0.65 per unit compared to $12.5 million or $0.68 per unit in third quarter 2002.
Equity income from Northern Border Pipeline amounted to $11.2 million in third quarter 2003 compared to $11.8 million for third quarter 2002. Consistent with prior quarters, Northern Border Pipeline incurred higher expenses related to electricity costs in third quarter 2003 compared to the same period last year. This increase in expenses was partially offset by lower interest expense in third quarter 2003 compared to the same period last year primarily due to lower average interest rates.
Equity income from Tuscarora amounted to $1.3 million in third quarter 2003 compared to $1.2 million for third quarter 2002. The increase was primarily due to incremental revenues from Tuscarora's expansion facilities, partially offset by increased operations and maintenance expenses and depreciation expense related to the new facilities.
The Partnership's third quarter 2003 general and administrative expenses were $0.5 million compared to $0.4 million for third quarter 2002. Financial charges of less than $0.1 million for third quarter 2003 were slightly lower than the same period last year primarily due to lower long-term debt balances.
Cash Flow
The Partnership reported third quarter cash generated from operations of $12.8 million compared to $13.4 million for third quarter 2002, reflecting a $1.0 million decrease in the cash distribution from Northern Border Pipeline, partially offset by a $0.5 million increase in the cash distribution from Tuscarora. In third quarter 2003, the Partnership received a cash distribution from Northern Border Pipeline amounting to $11.6 million compared to $12.6 million for third quarter 2002. The decrease is primarily due to higher electricity costs incurred by Northern Border Pipeline during third quarter 2003. The Partnership also received a cash distribution from Tuscarora in third quarter 2003 amounting to $1.6 million compared to $1.1 million for third quarter 2002. The increase reflects Tuscarora's incremental cash inflows from new transportation contracts, including those related to Tuscarora's expansion facilities.
During third quarter 2003, the Partnership paid an aggregate $10.1 million of cash distributions to unitholders and its general partner, compared to $9.6 million in third quarter 2002. This cash distribution, on a per unit basis, represents $0.55 per unit in third quarter 2003, as compared to $0.525 per unit in third quarter 2002, as well as the general partner interest including incentive distributions. Also, in third quarter 2003, the Partnership made a cash contribution of $0.8 million to Tuscarora related to their expansion.
Conference Call
The Partnership will hold a conference call Friday, October 24, 2003 at 10:00 a.m. (eastern). During this call, TC PipeLines, LP's senior executives will review the Partnership's third quarter 2003 results and discuss general developments and issues concerning the Partnership. Those interested in listening to the call may dial (800) 273-9672. A replay of the conference call will also be available two hours after the conclusion of the call until midnight, October 31, 2003 by dialing (800) 408-3053 then entering passcode 1487818.
A live web cast of the conference call will also be available through the Partnership's Internet site at www.tcpipelineslp.com. An audio replay of the call will be maintained on the website.
TC PipeLines, LP owns a 30% general partner interest in Northern Border Pipeline Company and a 49% general partner interest in Tuscarora Gas Transmission Company. The remaining 70% general partner interest in Northern Border Pipeline is owned by Northern Border Partners, L.P., a publicly traded master limited partnership controlled by affiliates of Enron Corp. Northern Border Pipeline owns a 1,249-mile United States interstate pipeline system that transports natural gas from the Montana-Saskatchewan border to markets in the midwestern United States. Tuscarora owns a 240-mile United States interstate pipeline system that transports natural gas from Oregon, where it interconnects with facilities of Gas Transmission Northwest Corporation, to northern Nevada. TC PipeLines, LP's general partner is a wholly owned subsidiary of TransCanada PipeLines Limited, which also holds a minority general partner interest in Northern Border Partners, L.P. Common units of TC PipeLines, LP are quoted on the Nasdaq Stock Market and trade under the symbol "TCLP".
Click here to view TC PipeLines, LP's Fourth Quarter Financial Highlights
Media Inquiries:
Hejdi Feick / Kurt Kadatz
(403) 920-7859
Unitholder and Analyst Inquiries:
David Moneta / Debbie Stein
Toll-free (877) 290-2772
investor_relations@tcpipelineslp.com
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