Thursday, February 16, 2012

Magellan Midstream 4th quarter profit rises 25 percent on sales growth

Fourth-quarter earnings at Magellan Midstream Partners LP (NYSE: MMP) rose 25 percent as revenue benefited from high commodity prices and growth projects.

For the year, the company projected per-unit earnings of $3.75, above recent estimates of analysts polled by Thomson Reuters for $3.66.

For the current first quarter 2012, the company forecast per-unit earnings of 98 cents, above analysts' estimates of 90 cents.

Chief Executive Michael Mears said the company expects "the favorable momentum of 2011 to continue with another record year projected for 2012 as additional expansion projects come on line."

For the fourth quarter, Magellan Midstream reported a profit of $110.3 million, or 97 cents a unit, up from $88 million, or 78 cents a unit, a year earlier. Excluding mark-to-market impacts, earnings were $1.02 a share. The company in November forecast 93 cents a share, which was slightly below analysts' views at the time.

Revenue increased 22 percent to $486.9 million. Analysts most recently projected $434 million.

Operating margin eased to 28.7 percent from 28.9 percent amid higher operating and product purchases costs.

Based on progress of expansion programs under way, the company raised its 2012 capital spending forecast to $430 million from its November view for $270 million.

Magellan also raised its 2013 estimate to $90 million to complete the projects, from $65 million as it continues to pursue expansion opportunities.

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