Analysts & Investor FAQ

Analysts

Firm Analyst
Citigroup Faisel Khan
J.P. Morgan Jeremy Tonet
BofA Merrill Lynch Derek Walker
Credit Suisse John Edwards
Wells Fargo Securities Praneeth Satish

Investor FAQ

Below are answers to some FAQs which you may find useful. Please note that these are offered for general information only and should not be taken as advice. For personal financial guidance, you should consult your investment professional or tax adviser. For more information on VTTI Energy Partners LP please consult the pages on this website, and our investor presentations and SEC filings.

What is a Master Limited Partnership?

A Master Limited Partnership (MLP) is a publicly traded partnership in which there are two different types of partners:

  • Limited partners (LPs) which are investors that purchase units in the MLP and, in return, receive distributions from it; and
  • A general partner (GP), which manages the MLP. The general partner of VTTI Energy Partners LP, which is a Marshall Islands limited partnership (“VTTI”), is VTTI Energy Partners GP LLC, a Marshall Islands limited liability company.

For more information about MLPs, visit The National Association of Publicly Traded Partnerships at www.naptp.org.

Do Master Limited Partners pay a dividend?

MLPs make cash ‘distributions’, which are similar to dividends. These distributions, explained in detail below, are paid on a quarterly basis.

What is VTTI’s Strategy?

VTTI is a limited partnership formed in April 2014 by VTTI B.V., one of the world’s largest independent energy terminalling businesses, to own, operate, develop and acquire refined petroleum product and crude oil terminalling, and related energy infrastructure assets, on a global scale. Our initial assets consist of a 36% interest in VTTI Operating, which owns a portfolio of 6 terminals with 396 tanks and 35.5 million barrels of refined petroleum product and crude oil storage capacity. The portfolio spans Europe, the Middle East, Asia, and North America. When measured by total storage capacity it represents one of the largest independent portfolios of refined petroleum product and crude oil terminalling assets in the world.

Capitalising on our relationship with VTTI and its owners (Vitol and Buckeye Partners), our management team is dedicated to continuing growth through a strategy of acquisitions from VTTI or third parties, organic development opportunities, greenfield construction and optimisation of our existing assets.

Our primary business objective is to generate stable and predictable cash flows that will enable us to pay quarterly cash distributions to our unitholders, and to increase those distributions over time. We generate substantially all of our revenue from long-term, fee-based, take-or-pay contracts for the terminal storage and throughput of refined petroleum products and crude oil.

How do I purchase VTTI units?

VTTI units are traded on the New York Stock Exchange (NYSE) and can be purchased through your broker or financial institution.

Who is VTTI’s transfer agent and how can I contact them?

VTTI’s transfer agent is Computershare, Inc. They can be contacted by mail at:

Computershare, Inc.
P.O. Box 43078
Providence, RI 02940

Does VTTI make cash distributions?

Yes. Within 45 days of the end of each quarter, VTTI will distribute all available cash to unitholders of record on the applicable record date. ‘Available cash’ generally means all cash on hand at the end of the quarter (including VTTI’s proportionate share of cash on hand of any subsidiaries the company does not wholly own):

  • Less the amount of cash reserves established by the general partner and subsidiaries.
  • Plus, if the general partner so determines, all cash on hand on the date of determination of available cash for the quarter resulting from (1) working capital borrowings made after the end of the quarter and (2) cash distributions received after the end of the quarter.

There is no guarantee, however, that VTTI will pay the minimum quarterly distribution on the common units and subordinated units in any quarter. Even if VTTI’s cash distribution policy is not modified or revoked, the amount of distributions paid under the policy, and the decision to make any distribution, is determined by the general partner.

Please read “How We Make Cash Distributions” in our Registration Statement filed on Form F-1 (No. 333-196907) with the Securities and Exchange Commission for more information relating to VTTI’s cash distributions.

When are VTTI’s cash distributions paid?

VTTI’s cash distributions are paid within 45 days of the end of each quarter, beginning with the quarter ending September 30, 2014.

What are the tax implications of the distribution?

Although organised as a partnership, VTTI has elected to be treated as a corporation solely for U.S. federal income tax purposes. Consequently, U.S. limited partners will not be directly subject to U.S. federal income tax on our income, but rather on distributions received from VTTI. All or a portion of the distributions received from VTTI will constitute dividends for such purposes. The remaining portion of such distributions will be treated first as a non-taxable return of capital to the extent of your tax basis in your common units and, thereafter, as capital gain.

What is VTTI’s fiscal year? When are earnings reported?

For tax and financial reporting purposes, VTTI’s fiscal year is the calendar year ending December 31. Earnings are reported on a quarterly basis.

What is VTTI’s structure and how does the company make money?

VTTI provides long-term, fee-based terminalling services for third party companies engaged in the production, processing, distribution and marketing of refined petroleum products and crude oil. VTTI generates 100% of our revenue through the provision of fee-based services to our customers. VTTI’s fees comprise:

  • Storage and throughput fees: VTTI customers pay fixed monthly fees for storage and associated liquid throughput handling, even if the actual capacity they use or the amount of product that we receive is less than the amount reserved. Storage and throughput fees generated approximately 88% and 93% of revenues for the year ended December 31, 2013 and the three months ended March 31, 2014, respectively.
  • Excess throughput and ancillary fees: VTTI customers pay excess throughput fees if the actual product handled is more than the amount agreed in the contract. They also pay additional fees for ancillary services such as mixing, blending, heating and transferring products between VTTI tanks or to rail or truck. For the year ended December 31, 2013 and the three months ended March 31, 2014, these fees generated approximately 12% and 7% of revenues respectively, from excess throughput and ancillary service fees.
Which tax documents are attributable to the different company securities?

VTTI unitholders receive an annual 1099 pertaining to their dividend income (but no K-1).

Where is the VTTI corporate headquarters?

Our corporate headquarters are located at:

25-27 Buckingham Palace Road
London
SW1W 0PP
United Kingdom
Tel +44 20 7973 4200