NuStar GP Holdings, LLC Reports Increased EPU in the Second Quarter of 2014

  NuStar GP Holdings, LLC Reports Increased EPU in the Second Quarter of 2014

Business Wire

SAN ANTONIO -- July 25, 2014

NuStar GP Holdings, LLC (NYSE: NSH) today announced that net income for the
second quarter of 2014 was $15.8 million, or $0.37 per unit, compared to $12.6
million, or $0.29 per unit, for the second quarter of 2013. Second quarter
2014 distributable cash flow available to unitholders was $22.8 million, or
$0.54 per unit, compared to $23.2 million, or $0.54 per unit, for the second
quarter of 2013.

With respect to the quarterly distribution to unitholders for the second
quarter of 2014, NuStar GP Holdings, LLC announced that its board of directors
has declared a distribution of $0.545 per unit. The second quarter 2014
distribution will be paid on August 14, 2014, to holders of record as of
August 6, 2014.

“NuStar GP Holdings, LLC benefitted from NuStar Energy L.P.’s strong second
quarter results and remains well positioned given NuStar Energy L.P.’s
strategic re-direction,” said Brad Barron, President and Chief Executive
Officer of NuStar Energy L.P. and NuStar GP Holdings, LLC.

A conference call with management is scheduled for 10:00 a.m. ET (9:00 a.m.
CT) today, July 25, 2014, to discuss the financial results for the second
quarter of 2014. Investors interested in listening to the presentation may
call 800/622-7620, passcode 63499232. International callers may access the
presentation by dialing 706/645-0327, passcode 63499232. The company intends
to have a playback available following the presentation, which may be accessed
by calling 800/585-8367, passcode 63499232. International callers may access
the playback by calling 404/537-3406, passcode 63499232.

Investors interested in listening to the live presentation or a replay via the
internet may access the presentation directly by clicking here or by logging
on to NuStar GP Holdings, LLC’s Web site at www.nustargpholdings.com.

NuStar GP Holdings, LLC is a publicly traded limited liability company that
owns the two percent general partner interest, a 12.9 percent limited partner
interest and the incentive distribution rights in NuStar Energy L.P., one of
the largest independent liquids terminal and pipeline operators in the nation.
NuStar has operations in the United States, Canada, Mexico, the Netherlands,
including St. Eustatius in the Caribbean, the United Kingdom and Turkey. For
more information, visit NuStar GP Holdings, LLC’s Web site at
www.nustargpholdings.com.

This release serves as qualified notice to nominees under Treasury Regulation
Sections 1.1446-4(b)(4) and (d). Please note that 100% of NuStar’s
distributions to foreign investors are attributable to income that is
effectively connected with a United States trade or business. Accordingly, all
of NuStar’s distributions to foreign investors are subject to federal income
tax withholding at the highest effective tax rate for individuals and
corporations, as applicable. Nominees, and not NuStar, are treated as the
withholding agents responsible for withholding on the distributions received
by them on behalf of foreign investors.

Cautionary Statement Regarding Forward-Looking Statements

This press release includes forward-looking statements regarding future
events. All forward-looking statements are based on the company’s beliefs as
well as assumptions made by and information currently available to the
company. These statements reflect the company’s current views with respect to
future events and are subject to various risks, uncertainties and assumptions.
These risks, uncertainties and assumptions are discussed in NuStar Energy L.P.
and NuStar GP Holdings, LLC’s 2013 annual reports on Form 10-K and subsequent
filings with the Securities and Exchange Commission.

                                                
NuStar GP Holdings, LLC
Condensed Financial Information
(Unaudited, Thousands of Dollars, Except Unit and Per Unit Data)
                                                   
                 Three Months Ended June 30,       Six Months Ended June 30,
                  2014          2013           2014          2013       
Statement of
Income Data:
Equity in
earnings of      $ 16,739         $ 13,417         $ 31,129         $ 25,561
NuStar Energy
L.P.
                                                                    
General and
administrative     (880       )     (618       )     (1,752     )     (1,418     )
expenses
Other income,      196              18               213              99
net
Interest          (231       )    (170       )    (453       )    (343       )
expense, net
                                                                    
Income before
income tax         15,824           12,647           29,137           23,899
(expense)
benefit
Income tax
(expense)         (56        )    (88        )    277            (265       )
benefit
Net income       $ 15,768        $ 12,559        $ 29,414        $ 23,634     
                                                                    
Basic and
diluted net      $ 0.37          $ 0.29          $ 0.69          $ 0.55       
income per
unit
                                                                    
Equity in
Earnings of
NuStar Energy
L.P.:
General
partner          $ 894            $ 446            $ 1,473          $ 722
interest
General
partner           10,805         10,805         21,610         21,610     
incentive
distribution
General
partner’s
interest in
earnings and       11,699           11,251           23,083           22,332
incentive
distributions
of NuStar
Energy L.P.
Limited
partner
interest in        5,761            2,887            9,488            4,671
earnings of
NuStar Energy
L.P.
Amortization
of step-up in
basis related
to NuStar         (721       )    (721       )    (1,442     )    (1,442     )
Energy L.P.’s
assets and
liabilities
Equity in
earnings of      $ 16,739        $ 13,417        $ 31,129        $ 25,561     
NuStar Energy
L.P.
                                                                    
Distributable
Cash Flow
(Note 1):
Cash
distributions
from NuStar
Energy L.P.
associated
with:
General
partner          $ 1,961          $ 1,961          $ 3,922          $ 3,922
interest
General
partner            10,805           10,805           21,610           21,610
incentive
distribution
Limited
partner           11,223         11,272         22,434         22,552     
interest –
common units
Total cash
distributions
expected from      23,989           24,038           47,966           48,084
NuStar Energy
L.P.
Deduct
expenses of
NuStar GP
Holdings, LLC:
General and
administrative     (880       )     (618       )     (1,752     )     (1,418     )
expenses
Income tax
(expense)          (56        )     (88        )     277              (265       )
benefit
Interest          (231       )    (170       )    (453       )    (343       )
expense, net
DCF              $ 22,822        $ 23,162        $ 46,038        $ 46,058     
                                                                    
Weighted
average number
of common          42,658,178       42,618,376       42,657,235       42,612,057
units
outstanding
                                                                    
DCF per unit     $ 0.54           $ 0.54           $ 1.08           $ 1.08
(Note 1)
                                                                    
Cash
distributions
to be paid to
the
unitholders of

NuStar GP
Holdings, LLC:
Distribution     $ 0.545          $ 0.545          $ 1.090          $ 1.090
per unit
                                                                    
Total            $ 23,250         $ 23,236         $ 46,498         $ 46,458
distribution
                                                                                 

                           NuStar GP Holdings, LLC
                Consolidated Financial Information - Continued
           (Unaudited, Thousands of Dollars, Except Per Unit Data)

Notes:

(1) NuStar GP Holdings, LLC utilizes financial measures, distributable cash
flow (DCF) and DCF per unit, which are not defined in U.S. generally accepted
accounting principles. Management uses these financial measures because they
are widely accepted financial indicators used by investors to compare company
performance. In addition, management believes that these measures provide
investors an enhanced perspective of the ability to make a minimum quarterly
distribution. DCF and DCF per unit are not intended to represent cash flows
from operations for the period, nor are they presented as an alternative to
net income. They should not be considered in isolation or as a substitute for
a measure of performance in accordance with U.S. generally accepted accounting
principles.

The following is a reconciliation of net income to DCF and net cash provided
by operating activities:

                      Three Months Ended June 30,  Six Months Ended June 30,
                         2014        2013        2014       2013    
Net income             $  15,768       $ 12,559      $ 29,414      $ 23,634
Less equity in
earnings of NuStar        (16,739  )     (13,417 )     (31,129 )     (25,561 )
Energy L.P.
Plus cash
distributions             23,989         24,038        47,966        48,084
expected from NuStar
Energy L.P.
Other income, net        (196     )    (18     )    (213    )    (99     )
DCF                       22,822         23,162        46,038        46,058
Less cash
distributions             (23,989  )     (24,038 )     (47,966 )     (48,084 )
expected from NuStar
Energy L.P.
Distributions of
equity in earnings        16,739         13,417        31,129        25,561
of NuStar Energy
L.P.
Net effect of
changes in operating     1,223        (611    )    1,747       60      
accounts
Net cash provided by   $  16,795      $ 11,930     $ 30,948     $ 23,595  
operating activities

Contact:

NuStar Energy, L.P., San Antonio
Investors, Chris Russell, Treasurer and Vice President Investor Relations
Investor Relations: 210-918-3507
or
Media, Mary Rose Brown, Executive Vice President,
Corporate Communications: 210-918-2314
Web site: http://www.nustarenergy.com
 
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