However, in spite of the 0.2% decline in gross profit posted by IMTT for the fourth quarter, good performance through the first three quarters resulted in gross profit increasing by 10.1% for the full year, he said.

MIC has a 50% equity interest in IMTT, the operator of one of the largest independent bulk liquid terminals businesses in the U.S. IMTT owns and operates 10 marine terminals in the U.S. and is the part owner and operator of two terminals in Canada. The terminals handle a wide variety of petroleum grades, chemicals and vegetable and animal oils. Financial result of IMTT refers to 100% of the business, not MIC’s 50% interest.

Terminal revenue at IMTT rose by 4.4% in the fourth quarter of 2013 compared with the fourth quarter of 2012. The increase was driven by increases in storage rates of 2.8% and an increase in ancillary services revenue. However, as reported in MIC’s third quarter 2013 results, there was a change in the nature of a small number of customer contracts where take-or-pay long-term infrastructure access payments were decoupled from storage contracts. Had these services been included in storage rates as they had been historically, average storage rates would have increased by 4.4% and 6.4% for the fourth quarter and full year, respectively. For the full year, terminal revenue increased by 7.6%.

Terminal revenue gains were offset by a 10.2% increase in terminal operating expenses for the quarter and 4.6% for the year versus the prior comparable periods. Terminal operating expenses rose as a result of higher underlying labor costs, repairs and maintenance costs, particularly in December, and other costs. The increase in labor costs in the fourth quarter was attributed to an increase in health care claims of $1.7 million.

IMTT generated reported increases in EBITDA and Free Cash Flow for the quarter of 5.5% and 33.1%, respectively. The reported results for all of 2013 include the effect of a change in the treatment of certain pension items. IMTT’s EBITDA is now reported in a manner consistent with MIC’s other businesses. The non-cash pension expense is excluded and the actual cash pension contribution is disclosed separately as a reduction in Free Cash Flow. Had these changes not been made, growth in EBITDA and Free Cash Flow for the quarter would have been 0.7% and 17.8%, respectively, compared with the fourth quarter in 2012.

IMTT’s reported EBITDA and Free Cash Flow for 2013 increased 15.9% and 1.4%, respectively to $268.5 million and $120.8 million versus the prior comparable period. The increase reflects the improved operating results, the inclusion of casualty losses for which the business was reimbursed through insurance proceeds and the above-mentioned change in methodology with respect to reporting certain pension items. Had the treatment of IMTT’s pension items not changed, IMTT would have generated an annualized change in EBITDA and Free Cash Flow of 10.9% and (4.5%), respectively. On the same basis, EBITDA for 2013 would have been slightly below the low end of MIC’s guidance.

IMTT’s results for the fourth quarter include an increase in the business’ provision for income taxes and lower, although above average, maintenance capital expenditures versus the prior comparable period. Maintenance capital expenditures were higher in the fourth quarter of 2012 as a result of damage inflicted on the business’ Bayonne, N.J., facility by Hurricane Sandy.

Free Cash Flow generated by IMTT increased by 1.4% for the year as a result of improved performance during the first nine months of the year, partially offset by an increase in maintenance capital expenditures to $83.2 million in 2013 from $58.4 in 2012, higher interest expense and higher taxes. The increase in maintenance capital expenditures included costs incurred at IMTT’s Bayonne, N.J., facility in the wake of Hurricane Sandy. MIC expects maintenance capital expenditures to return to historically normal levels in 2014.