Tallgrass Energy Partners, LP (TEP) has reported 42.30 percent jump in profit for the quarter ended Sep. 30, 2016. The company has earned $60.73 million, or $0.45 a share in the quarter, compared with $42.68 million, or $0.50 a share for the same period last year. Revenue during the quarter grew 10.10 percent to $152.12 million from $138.17 million in the previous year period. Total expenses were 57.54 percent of quarterly revenues, down from 61.70 percent for the same period last year. This has led to an improvement of 416 basis points in operating margin to 42.46 percent.
Operating income for the quarter was $64.60 million, compared with $52.92 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $108.53 million compared with $65.85 million in the prior year period. At the same time, adjusted EBITDA margin improved 2368 basis points in the quarter to 71.34 percent from 47.66 percent in the last year period.
To concentrate Tallgrass Energy’s commercial development efforts and continue to focus on developing relationships with, and solutions for, our customers across all of our assets, Matthew Sheehy has been named Senior Vice President and Chief Commercial Officer at Tallgrass Energy, reporting to William R. Moler, our Chief Operating Officer. Mr. Sheehy has been instrumental in executing Tallgrass Energy's vision to transform REX into a bi-directional header system through the Seneca Lateral, East-to-West and Capacity Enhancement projects and valuable customer contracts. As part of the transition, Crystal Heter will serve as the Vice President and General Manager of REX. Ms. Heter, a chemical engineer, started her career as an engineering intern with predecessor companies and moved up through both the technical and commercial sides of the business. She is an accomplished leader at Tallgrass Energy and possesses a deep knowledge of REX, its customers and the markets it serves.
Operating cash flow improves significantly
Tallgrass Energy Partners, LP has generated cash of $305.92 million from operating activities during the nine month period, up 54.91 percent or $108.43 million, when compared with the last year period. The company has spent $549.57 million cash to meet investing activities during the nine month period as against cash outgo of $769.77 million in the last year period.
Cash flow from financing activities was $242.46 million for the nine month period, down 58.91 percent or $347.67 million, when compared with the last year period.
Cash and cash equivalents stood at $0.42 million as on Sep. 30, 2016, down 97.77 percent or $18.29 million from $18.70 million on Sep. 30, 2015.
Working capital turns negative
Working capital of Tallgrass Energy Partners, LP has turned negative to $17.02 million on Sep. 30, 2016 from positive $15.78 million on Sep. 30, 2015. Current ratio was at 0.85 as on Sep. 30, 2016, down from 1.21 on Sep. 30, 2015.
Days sales outstanding went down to 16 days for the quarter compared with 35 days for the same period last year.
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