Nustar Energy L.P. (NS) swung to a net loss for the quarter ended Dec. 31, 2016. The company has made a net loss of $11.06 million, or $ 0.31 a share in the quarter, against a net profit of $59.48 million, or $0.61 a share in the last year period.
Revenue during the quarter went up marginally by 1.47 percent to $471.76 million from $464.92 million in the previous year period. Gross margin for the quarter contracted 422 basis points over the previous year period to 59.32 percent. Total expenses were 81.90 percent of quarterly revenues, up from 78.92 percent for the same period last year. That has resulted in a contraction of 299 basis points in operating margin to 18.10 percent.
Operating income for the quarter was $85.37 million, compared with $98.02 million in the previous year period.
"I am very pleased with the many initiatives that we completed in 2016 that set the stage for a great year in 2017 and beyond," said Brad Barron, president and chief executive officer of NuStar Energy L.P. and NuStar GP Holdings, LLC. "We are very excited to have completed an immediately accretive acquisition in the fourth quarter and to finally eliminate all ties to our former asphalt business. From a financing perspective, we feel the non-cash impairment in the fourth quarter is a small price to pay to receive a $110 million cash payment in 2017 that when coupled with the $100 million of cash we repatriated from our international operations and the proceeds that we received from issuing $226.5 million of preferred units in 2016, will significantly reduce the amount of capital needed to be raised in the financial markets to fund our future growth capital needs. And, of course, it goes without saying that I am also very pleased to eliminate the need to provide up to $125 million in credit support to Axeon and put a close to this chapter of our history once and for all."
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