SIOUX CITY, Iowa, April 22 /PRNewswire/ -- Terra Nitrogen Company, L.P.
(TNCLP) (NYSE: TNH) today reported a net loss of $2.0 million on revenues of
$54.1 million for the quarter ended March 31, 1999. This compares with net
income of $5.8 million on revenues of $48.9 million for the first quarter of
1998. The loss per limited partnership unit was $0.11 for the quarter,
compared with earnings of $0.31 for the first quarter last year.
The decline in profitability that the partnership continues to experience
is due to price pressure resulting from worldwide over-capacity. Ammonia,
nitrogen solutions and urea prices were down 27%, 3% and 16%, respectively,
from the first quarter of 1998. Sales volumes, however, for the primary
products -- ammonia and nitrogen solutions -- increased year over year.
Ammonia sales volumes were up 107% from the year-ago quarter, spurred by the
lower prices and an early start to the planting season, which favors ammonia
application. Nitrogen solutions sales volumes increased 20% and were also
impacted by the early start to the season due to favorable weather conditions
in the southwest marketing area. Natural gas costs were up 4% from the first
quarter of 1998.
TNCLP announced that there would be no cash distribution to unitholders.
There was also no cash distribution for the first quarter of 1998. Cash
distributions are dependent on TNCLP earnings, working capital requirements
and capital expenditures, among other factors. TNCLP earnings are
traditionally highest in the quarter ending June 30 due to the seasonal demand
for fertilizer. Earnings can also be affected by market prices for nitrogen
products, the cost of natural gas, industry production levels, business cycles
and weather.
Note: Terra Nitrogen's news releases are available by fax at no charge by
calling 800-758-5804, code 106067.
This news release contains statements that may be interpreted as forward-
looking. Such statements involve risks and uncertainties and should be
considered along with the factors affecting our business as discussed on pages
5 and 6 in our 1998 annual report to unitholders.
(Tables follow)
TERRA NITROGEN COMPANY, L.P.
Consolidated Statements of Income
($ in Thousands, Except Per Unit Amounts)
Three Months Ended
March 31,
1999 1998
Revenues $53,784 $48,499
Other Income 289 417
Total Net Revenues 54,073 48,916
Cost of Goods Sold 53,763 40,595
Gross Profit 310 8,321
Operating Expenses 2,217 2,443
Operating Income (1,907) 5,878
Interest Expense (431) (491)
Interest Income 300 414
Net Income $(2,039) $5,801
Net Income per Limited Partnership Unit $(0.11) $0.31
The amount of net income allocable to the Limited Partners' interest is
based on the Partnership's net income and the proportionate share of cash
distributed to the Limited Partners and the General Partner.
Nitrogen Volumes and Prices 1999 1998
Sales Average Sales Average
Quarter Volumes Unit Price Volumes Unit Price
(000 tons) ($/ton) (000 tons) ($/ton)
Ammonia 131 104 63 142
UAN 470 61 390 63
Urea 127 91 137 108
TERRA NITROGEN COMPANY, L.P.
Consolidated Balance Sheets
($ in Thousands)
March 31,
1999 1998
Assets
Cash and Cash Equivalents $36 $1,535
Accounts Receivable 2,281 2,389
Inventory 50,179 46,873
Prepaid Expenses and Other Current Assets 1,316 2,961
Total Current Assets 53,812 53,758
Property, Plant and Equipment, Net 164,241 169,073
Other Assets 8,758 11,925
Total Assets $226,812 $234,756
Liabilities and Partners' Capital
Short-term Note $15,197 $0
Accounts Payable and Accrued Liabilities 20,795 31,349
Current Portion of Long-term
Capital Lease Obligations 1,132 1,083
Total Current Liabilities 37,124 32,432
Long-term Debt and Capital
Lease Obligations 12,971 13,766
Other Long-term Liabilities 0 1,060
Partners' Capital 176,716 187,498
Total Liabilities and Partners' Capital $226,812 $234,756
SOURCE Terra Nitrogen Company, L.P.
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Company News On-Call:
http://www.prnewswire.com/comp/106067.html or fax,
800-758-5804, ext. 106067
CONTACT:
Paula C. Norton of Terra, 712-277-5438
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