(Houston - April 8, 2009) Plains All American Pipeline, L.P. (NYSE:PAA) today announced a cash distribution of $0.905 per unit ($3.62 per unit on an annualized basis) on all of its outstanding limited partner units. The distribution will be payable on May 15, 2009, to holders of record of such units at the close of business on May 5, 2009. The distribution represents an increase of approximately 4.6% over the quarterly distribution of $0.865 per unit paid in May 2008 and approximately 1.4% over the quarterly distribution of $0.8925 paid in February 2009.
Greg L. Armstrong, Chairman and CEO of PAA, stated that the Partnership has significantly increased its already substantial liquidity and financial flexibility since year-end 2008 as a result of strong financial performance, the realization of planned inventory reductions and financing activities completed during the first quarter. PAA ended the first quarter with approximately $1.5 billion of unused, committed liquidity available under its credit facilities, up from $1.0 billion at year-end.
Armstrong noted that the Partnership's adjusted earnings before interest expense, income taxes and depreciation and amortization ("Adjusted EBITDA") for the first quarter 2009 are expected to be in line with or above the high end of the guidance range of $235 million to $255 million contained in the Partnership's Form 8-K furnished on February 11, 2009. The Partnership will provide additional commentary on first-quarter results and update its 2009 guidance in conjunction with its first-quarter earnings conference call on May 7, 2009.
"PAA's asset base and business model have generated strong performance thus far in 2009 and our current outlook for the remainder of the year remains solid," said Armstrong. "In addition, as evidenced by the success of our recent equity offering, certain aspects of the financial markets have re-opened and stabilized since the chaotic fourth quarter of 2008. In light of these factors, our solid distribution coverage levels and the importance of distribution growth to our unitholders, our board of directors elected to declare an increase in our quarterly distribution level."
"Although we remain cautiously optimistic about PAA's positioning relative to the global economic and financial markets, our guarded macro outlook has not changed and we intend to maintain significant flexibility to react to any unforeseen developments and associated challenges, as well as to potential opportunities that may arise." Armstrong noted that, in addition to solid fundamental performance by PAA, any distribution growth for the remainder of 2009 will continue to be driven by developments in the global economic and financial markets and any resulting mid-course adjustments by PAA that are deemed appropriate in such circumstances.
Non-GAAP Financial Measures
EBITDA is a non-GAAP financial measure. Net income and cash flows from operations are the most directly comparable GAAP measures to EBITDA. Adjusted EBITDA excludes selected items impacting comparability. The Partnership's Form 8-K furnished on February 11, 2009 presents a calculation of Adjusted EBITDA and a reconciliation of EBITDA to net income. A copy of the February 11th Form 8-K is available on the Partnership's website (www.paalp.com) under "Investor Relations – Operating and Financial Guidance." In addition, the Partnership maintains on its website a reconciliation of all non-GAAP financial information, such as EBITDA, that it reconciles to the most comparable GAAP measures. To access the information, investors should click on the "Investor Relations" link on the Partnership's home page and then the "Non-GAAP Reconciliations" link on the Investor Relations page.
Plains All American Pipeline, L.P. is a publicly traded master limited partnership engaged in the transportation, storage, terminalling and marketing of crude oil, refined products and liquefied petroleum gas and other natural gas related petroleum products. Through its 50% indirect ownership in PAA Natural Gas Storage, LLC, the Partnership is also engaged in the development and operation of natural gas storage facilities. The Partnership is headquartered in Houston, Texas.
Forward-Looking Statements
Except for the historical information contained herein, the matters discussed in this report are forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ materially from results anticipated in the forward-looking statements. These risks and uncertainties include, among other things, future developments and circumstances at the time distributions are declared; failure to implement or capitalize on planned internal growth projects; maintenance of our credit rating and ability to receive open credit from our suppliers and trade counterparties; continued creditworthiness of, and performance by, our counterparties, including financial institutions and trading companies with which we do business; the success of our risk management activities; environmental liabilities or events that are not covered by an indemnity, insurance or existing reserves; abrupt or severe declines or interruptions in outer continental shelf production located offshore California and transported on our pipeline systems; shortages or cost increases of power supplies, materials or labor; the availability of adequate third-party production volumes for transportation and marketing in the areas in which we operate and other factors that could cause declines in volumes shipped on our pipelines by us and third-party shippers, such as declines in production from existing oil and gas reserves or failure to develop additional oil and gas reserves; fluctuations in refinery capacity in areas supplied by our mainlines and other factors affecting demand for various grades of crude oil, refined products and natural gas and resulting changes in pricing conditions or transportation throughput requirements; the availability of, and our ability to consummate, acquisition or combination opportunities; our ability to obtain debt or equity financing on satisfactory terms to fund additional acquisitions, expansion projects, working capital requirements and the repayment or refinancing of indebtedness; the successful integration and future performance of acquired assets or businesses and the risks associated with operating in lines of business that are distinct and separate from our historical operations; unanticipated changes in crude oil market structure and volatility (or lack thereof); the impact of current and future laws, rulings, governmental regulations, accounting standards and statements and related interpretations; the effects of competition; interruptions in service and fluctuations in tariffs or volumes on third-party pipelines; increased costs or lack of availability of insurance; fluctuations in the debt and equity markets, including the price of our units at the time of vesting under our long-term incentive plans; the currency exchange rate of the Canadian dollar; weather interference with business operations or project construction; risks related to the development and operation of natural gas storage facilities; general economic, market or business conditions and the amplification of other risks caused by deteriorated financial markets, capital constraints and pervasive liquidity concerns; and other factors and uncertainties inherent in the transportation, storage, terminalling and marketing of crude oil, refined products and liquefied petroleum gas and other natural gas related petroleum products discussed in the Partnership's filings with the Securities and Exchange Commission.
Contacts:
Roy I. Lamoreaux
Manager, Investor Relations
713-646-4222 or 800-564-3036
or
A. Patrick Diamond
Vice President
713-646-4487 or 800-564-3036
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