BreitBurn Energy Partners (BBEPQ) reported its fourth-quarter and full-year 2013 results before the market opened this morning. The company's results took a step back in the quarter. CEO Hal Washburn noted in a statement that BreitBurn faced a "variety of challenges" in the year-ending three-month period.
The company's oil and gas production totaled 3,086 million barrels of oil equivalent, or MBOE, on the quarter, which was less than the 3,098 MBOE that BreitBurn produced in the third quarter. While the company's oil production was higher, it wasn't high enough to overcome a decline in natural gas production.
On top of stagnant production, BreitBurn also realized much lower oil prices on the fourth quarter: an average of $88.77 per barrel, versus the $100.94 per barrel the company realized in the third quarter. Because more than half of the company's production is oil, an increase in the realized prices of natural gas liquids and natural gas didn't have as great an impact on the company's cash flow in the fourth quarter.
These two factors caused the company's distributable cash flow to slip from $64.6 million reported in the third quarter to $55.4 million in the fourth quarter. That resulted in distributable cash flow per unit of just $0.46 and a coverage ratio of 0.93 times. Both numbers were well below the $0.64 per unit and 1.31 times that the company reported in the prior quarter.
Despite this, 2013 was a tremendous year of growth for BreitBurn Energy Partners. The company reported record annual production and adjusted EBITDA. According to the company's press release, total production was 10,983 MBoe in 2013, an increase of 32% from 2012 and a record high for the partnership. Adjusted EBITDA was $370.4 million, an increase of 34% from 2012 and also a record high.
Furthermore, the company said it is "very optimistic" about its prospects this year.