TC PipeLines, LP Announces 2013 First Quarter Cash Distribution and Financial Results

TC PipeLines, LP Announces 2013 First Quarter Cash Distribution and Financial 
Results 
HOUSTON, TEXAS -- (Marketwired) -- 04/24/13 -- TC PipeLines, LP
(NYSE:TCP) (the Partnership) today announced that the board of
directors of TC PipeLines GP, Inc., its general partner (the General
Partner), declared the Partnership's first quarter 2013 cash
distribution of $0.78 per common unit. The distribution is unchanged
from the fourth quarter 2012 distribution and is payable on May 15,
2013 to unitholders of record as of the close of business on May 6,
2013. 
The Partnership also reported first quarter 2013 Partnership cash
flows of $43 million and net income of $29 million or $0.52 per
common unit. 
"The Partnership performed as expected in the first quarter with the
majority of our pipelines supported by stable longer-term contracts,"
said Steve Becker, president of TC PipeLines GP, Inc. "Great Lakes'
revenues were lower in the quarter due to current challenging market
conditions." 
"We continue to believe in the long-term strength of the North
American natural gas industry which we expect will generate ongoing
value for our unitholders," added Becker. 
First Quarter 2013 Highlights (All financial figures are unaudited) 


 
--  Partnership cash flows of $43 million 
    
--  Paid cash distributions of $43 million or $0.78 per common unit 
    
--  Net income of $29 million or $0.52 per common unit 

 
The Partnership's financial highlights for the first quarter of 2013
compared to the first quarter of 2012 were: 


 
                                                         Three months ended 
(unaudited)                                                       March 31, 
(millions of dollars except per common unit amounts)         2013      2012 
----------------------------------------------------------------------------
Partnership cash flows(a)                                      43        50 
Cash distributions paid                                       (43)      (42)
Cash distributions paid per common unit                     $0.78    $ 0.77 
Net income                                                     29        39 
Net income per common unit(b) - basic and diluted           $0.52    $ 0.71 
Weighted average common units outstanding (millions) -                      
 basic and diluted                                           53.5      53.5 
Common units outstanding at end of period (millions)         53.5      53.5 

 
(a) Partnership cash flows is a non-GAAP financial measure. Refer to
the description of Partnership Cash Flows in the section of this
release entitled "Partnership Cash Flows" and the Supplemental
Schedule Non-GAAP Measures for further detail. 
(b) Net income per common unit is computed by dividing net income,
after deduction of the General Partner's allocation, by the weighted
average number of common units outstanding. The General Partner's
allocation is computed based upon the General Partner's effective two
percent general partner interest plus an amount equal to incentive
distributions. 
Recent Developments 
Cash Distributions - On April 23, 2013, the board of directors of our
General Partner declared the Partnership's first quarter 2013 cash
distribution in the amount of $0.78 per common unit, payable on May
15, 2013 to unitholders of record as of May 6, 2013. 
Liquidity and Capital Resources 
Partnership Cash Flows  
Partnership cash flows decreased by $7 million to $43 million in the
first quarter of 2013 compared to $50 million in the same period of
2012. This decrease was primarily due to lower cash distributions
from Great Lakes and Northern Border. 
The Partnership paid distributions of $43 million in the first
quarter of 2013, an increase of $1 million compared to the same
period in 2012. 
The Partnership uses the non-GAAP financial measures "Partnership
cash flows" and "Partnership cash flows before General Partner
distributions" as they provide measures of cash generated during the
period to evaluate our cash distribution capability. Management also
uses these measures as a basis for recommendations to our General
Partner's board of directors regarding the distribution to be
declared each quarter. Partnership cash flow information is presented
to enhance investors' understanding of the way that management
analyzes the Partnership's financial performance. 
Partnership cash flows include cash distributions from the
Partnership's equity investments, Great Lakes, Northern Border, GTN
and Bison, plus operating cash flows from the Partnership's
wholly-owned subsidiaries, North Baja and Tuscarora, net of
Partnership costs and distributions declared to the General Partner.  
Partnership cash flows and Partnership cash flows before General
Partner distributions are provided as a supplement to GAAP financial
results and are not meant to be considered in isolation or as
substitutes for financial results prepared in accordance with GAAP. 
Contractual Obligations 
At March 31, 2013, there was $309 million outstanding on the
Partnership's $500 million senior revolving credit facility leaving
$191 million available for future borrowing. The Partnership was in
compliance with the covenants of the credit agreement at March 31,
2013. 
Net Income 
For the three months ended March 31, 2013, net income decreased by
$10 million to $29 million compared to $39 million in the first
quarter of 2012 and was $1 million lower relative to the fourth
quarter of 2012. This decrease was primarily due to lower equity
earnings from Great Lakes and Northern Border. 
Equity earnings from Great Lakes were $2 million in the first quarter
of 2013, a decrease of $7 million compared to the same period in
2012. The decrease was due to Great Lakes' capacity being sold mostly
under short-term contracts and at lower rates and volumes in the
first quarter of 2013 compared to the same period in 2012.  
Equity earnings from Northern Border were $16 million in the first
quarter of 2013, a decrease of $4 million compared to the same
quarter in 2012. This decrease was due to the previously disclosed
tariff rate reduction as a result of the Northern Border Settlement.
In January 2013, FERC gave final approval for the Settlement reducing
Northern Border's reservation rates by 11 percent. 
Conference Call 
Analysts, members of the media, investors and other interested
parties are invited to participate in a teleconference by calling
866.226.1792 today, Wednesday, April 24, 2013 at 10 a.m. central
daylight time (CDT)/11 a.m. eastern daylight time (EDT). Steve
Becker, President of the General Partner, will discuss the
Partnership's financial results and latest developments. Please dial
in 10 minutes prior to the start of the call. No pass code is
required. Interested parties can also listen to a live webcast and
replay of the conference call by accessing the Investor Center
portion of the Partnership's website at www.tcpipelineslp.com. Slides
with information that may be discussed during the webcast will be
posted on the Investor Center of the Partnership's website under
"Events and Presentations" prior to the webcast. 
A replay of the teleconference will also be available two hours after
the conclusion of the call through May 1, 2013, by calling
800.408.3053, then entering pass code 6220304. 
TC PipeLines, LP is a Delaware master limited partnership with
interests in 5,560 miles of federally regulated U.S. interstate
natural gas pipelines which serve markets across the United States
and Eastern Canada. This includes significant interests in Great
Lakes Gas Transmission Limited Partnership and Northern Border
Pipeline Company as well as 25 percent ownership interest in each of
Gas Transmission Northwest LLC, and Bison Pipeline LLC. The
Partnership also wholly owns North Baja Pipeline, LLC and Tuscarora
Gas Transmission Company. The Partnership is managed by its general
partner, TC PipeLines GP, Inc., an indirect wholly-owned subsidiary
of the Partnership's sponsor, TransCanada Corporation (NYSE:TRP). TC
PipeLines GP, Inc. also holds common units of TC PipeLines, LP. For
more information about TC PipeLines, LP, visit the Partnership's
website at www.tcpipelineslp.com. 
Forward-Looking Statements 
Certain non-historical statements in this release relating to future
plans, projections, events or conditions are intended to be
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. These statements are based on current expectations and,
therefore, subject to a variety of risks and uncertainties that could
cause actual results to differ materially from the projections,
anticipated results or other expectations expressed in this release,
including, without limitation, competitive conditions in the natural
gas industry, increases in operating and compliance costs, the
outcome of rate proceedings, our ability to identify and complete
expansion and growth opportunities, operating hazards beyond our
control, availability of capital and market demand that the
Partnership expects or believes will or may occur in the future.
These and other factors that could cause future results to differ
materially from those anticipated are discussed in Item 1A in our
Annual Report on Form 10-K for the year-ended December 31, 2012 filed
with the Securities and Exchange Commission (the "SEC"), as updated
and supplemented by subsequent filings with the SEC. All
forward-looking statements are made only as of the date made and
except as required by applicable law, we undertake no obligation to
update any forward-looking statements to reflect new information,
subsequent events or other changes. 
TC PipeLines, LP Financial Summary 
Consolidated Statement of Income 


 
                                                         Three months ended 
(unaudited)                                                       March 31, 
(millions of dollars except per common unit amounts)         2013      2012 
----------------------------------------------------------------------------
Equity earnings from unconsolidated affiliates:                             
 Great Lakes                                                    2         9 
 Northern Border                                               16        20 
 GTN                                                            5         6 
 Bison                                                          3         3 
Transmission revenues                                          17        16 
Operating expenses                                             (4)       (4)
General and administrative                                     (2)       (2)
Depreciation                                                   (3)       (3)
Financial charges and other                                    (5)       (6)
                                                        --------------------
Net income                                                     29        39 
                                                        --------------------
                                                        --------------------
                                                                            
Net income allocation                                                       
Common units                                                   28        38 
General partner                                                 1         1 
                                                        --------------------
                                                               29        39 
                                                        --------------------
                                                        --------------------
                                                                            
Net income per common unit - basic and diluted             $ 0.52    $ 0.71 
                                                        --------------------
                                                        --------------------
                                                                            
Weighted average common units outstanding (millions)-                       
 basic and diluted                                           53.5      53.5 
                                                        --------------------
                                                        --------------------
                                                                            
Common units outstanding, end of the period (millions)       53.5      53.5 
                                                        --------------------
                                                        --------------------

 
TC PipeLines, LP Financial Summary 
Consolidated Condensed Balance Sheet 


 
                                                                            
(unaudited)                                         March 31,   December 31,
(millions of dollars)                                    2013           2012
----------------------------------------------------------------------------
ASSETS                                                                      
Current assets                                             10             12
Investment in unconsolidated affiliates                 1,556          1,563
Other assets                                              418            423
                                                   -------------------------
                                                        1,984          1,998
                                                   -------------------------
                                                   -------------------------
                                                                            
----------------------------------------------------------------------------
LIABILITIES AND PARTNERS' EQUITY                                            
Current liabilities                                        10              8
Other liabilities                                           2              1
Long-term debt, including current portion                 685            688
Partners' equity                                        1,287          1,301
                                                   -------------------------
                                                        1,984          1,998
                                                   -------------------------
                                                   -------------------------

 
 TC PipeLines, LP Supplemental Schedule 
Non-GAAP Measures 
Reconciliation of Net Income to Partnership Cash Flows 


 
                                                         Three months ended 
(unaudited)                                                       March 31, 
(millions of dollars except per common unit amounts)         2013      2012 
----------------------------------------------------------------------------
Net income                                                     29        39 
                                                        --------------------
Add:                                                                        
Cash distributions from Great Lakes(a)                          6        11 
Cash distributions from Northern Border(a)                     22        25 
Cash distributions from GTN(a)                                  6         5 
Cash distributions from Bison(a)                                4         4 
Cash flows provided by Other Pipes' operating activities       13        14 
                                                        --------------------
                                                               51        59 
Less:                                                                       
Equity earnings from unconsolidated affiliates                (26)      (38)
Other Pipes' net income                                       (10)       (9)
                                                        --------------------
                                                              (36)      (47)
                                                        --------------------
Partnership cash flows before General Partner                               
 distributions                                                 44        51 
General Partner distributions(b)                               (1)       (1)
                                                        --------------------
Partnership cash flows                                         43        50 
                                                        --------------------
Cash distributions declared                                   (43)      (42)
Cash distributions declared per common unit(c)             $ 0.78    $ 0.77 
Cash distributions paid                                       (43)      (42)
Cash distributions paid per common unit(c)                 $ 0.78    $ 0.77 
                                                        --------------------
                                                        --------------------

 
(a) In accordance with the cash distribution policies of the
respective entities, cash distributions from Great Lakes, Northern
Border, GTN and Bison are based on their respective prior quarter
financial results. 
(b) General Partner distributions represent the cash distributions
declared to the General Partner with respect to its effective two
percent General Partner interest plus an amount equal to incentive
distributions.  
(c) Cash distributions declared per common unit and cash
distributions paid per common unit are computed by dividing cash
distributions, after the deduction of the General Partner's
allocation, by the number of common units outstanding.
Contacts:
TC PipeLines, LP
Media Inquiries:
Shawn Howard/Grady Semmens
403.920.7859 
TC PipeLines, LP
Unitholder and Analyst Inquiries:
Rhonda Amundson
877.290.2772
investor_relations@tcpipelineslp.com
www.tcpipelineslp.com
 
 
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