Macquarie Infrastructure Company LLC Reports Second Quarter 2014 Financial Results, Increased Cash Dividend

NEW YORK--(BUSINESS WIRE)--

Macquarie Infrastructure Company LLC MIC reported financial results for the second quarter of 2014 including confirmation of the Company's previously announced increase in its quarterly cash dividend to $0.95 per share. MIC paid a cash dividend of $0.9375 per share in the first quarter of 2014.

The increase in the dividend was first made public on July 7, 2014 in connection with MIC's announcement that it had reached an agreement to acquire the remaining 50% interest in International-Matex Tank Terminals (“IMTT”) that it did not already own. The increase in its quarterly cash dividend is the third by MIC in as many quarters.

“We're confident in the expected increased contribution from IMTT over the remainder of the year and pleased that our Board has increased our quarterly cash dividend,” said James Hooke, Chief Executive Officer of MIC.

MIC generated proportionately combined Free Cash Flow of $56.7 million in the second quarter, up 21.5% from the $46.7 million in the comparable quarter in 2013. For the six months ended June 30, 2014, MIC's proportionately combined Free Cash Flow increased by 13.8% to $121.6 million, from $106.8 million in 2013.

On a per share basis, the absolute increase in proportionately combined Free Cash Flow was partially offset by an increase in the Company's weighted average number of shares outstanding of 11.1% and 14.7% for the quarter and year to date periods, respectively, and transaction-related costs pertaining primarily to acquisitions concluded by MIC's Atlantic Aviation business. Consequently, MIC generated proportionately combined Free Cash Flow per share of $1.00 per share during the second quarter of 2014, and $2.15 per share in the year to date period. The Company generated $0.92 per share and $2.17 per share, in the comparable quarter and year to date periods in 2013.

The decline in proportionately combined Free Cash Flow per share to $2.15 for the six months ended June 30, 2014 compared with $2.17 for the six months ended June 30, 2013 was attributed primarily to, (1) a $0.16 per share increase in cash taxes at IMTT, and (2) a delay in the closing of an acquisition by MIC's Atlantic Aviation business (while the Galaxy Acquisitions closed on April 30, the incremental shares to fund the transaction were issued in late 2013).

MIC regards Free Cash Flow as an important tool in assessing the performance of its capital intensive, cash generative businesses. Proportionately combined Free Cash Flow refers to the sum of the Free Cash Flow generated by MIC's businesses in proportion to its equity interest in each entity after holding company costs. See “Cash Generation” below for MIC's definition of Free Cash Flow and further information.

“Each of our businesses contributed to our results for the quarter at levels consistent with or better than our expectations,” said Hooke. “We saw continued growth at Atlantic Aviation, IMTT and Hawaii Gas. In addition, our results reflect the contribution from our growing Contracted Power and Energy (CP&E) segment.”

Following the quarter end, on July 7, 2014, MIC announced its execution of an agreement to acquire the remaining interest in IMTT it did not already own. At the same time the Company launched a public offering of LLC interests, or shares, and a concurrent offering of convertible senior notes to raise the funds necessary to fund the acquisition.

On July 15, 2014, MIC concluded a public offering of 11.5 million shares raising a gross $764.8 million and issued $350.0 million of convertible senior notes. A portion of the proceeds of the offerings, along with $115.0 million of shares issued to the seller, was used to fund the $1,025.0 million acquisition. The remaining proceeds from the offerings are available to fund growth capital projects, acquisitions by MIC's existing businesses and for general corporate purposes. The acquisition of the remainder of IMTT closed on July 16, 2014.

MIC has stated that it expects the transaction to be accretive to Free Cash Flow in 2014 and thereafter, excluding transaction related expenses. The Company revised its guidance for Free Cash Flow per share for the full year 2014 to $4.55 per share and established initial guidance for Free Cash Flow per share for 2015 of $5.10 per share. If achieved, the Free Cash Flow per share figures would represent year on year growth in 2014 of approximately 11.2% and approximately 12.1% in 2015.

“We're pleased to have been able to acquire the remainder of IMTT and believe that we are well placed to derive additional value from consolidating the ownership of the business,” said Hooke.

Commencing with the third quarter in 2014, MIC will consolidate IMTT for financial reporting and tax purposes and IMTT will become a reportable segment. MIC had accounted for IMTT using the equity method prior to the acquisition. The Company noted that consolidation will eliminate payment of federal income taxes by IMTT as a standalone entity and eliminate taxes on the portion of any distributions from IMTT to MIC that were not eligible for the Dividends Received Deduction or were not returns of capital. To the extent that IMTT generates federal taxable income in the future, the tax could be offset in consolidation with the application of MIC level net operating loss carryforwards.

MIC also closed on an additional investment in its Contracted Power & Energy (CP&E) segment during July. The Company completed an acquisition of a controlling interest in a 19.8 MW wind power generating facility in New Mexico for $10.6 million including transaction costs (press release issued on July 3). Similar to MIC's previous investments in the CP&E segment, the wind project in New Mexico will sell the electricity it generates pursuant to a 20-year power purchase agreement. MIC has expressed confidence in the cash generating capacity of its CP&E investments and has indicated that it would pursue additional investments of a similar size and type over the upcoming 12 to 18 months.

“We're pleased with the investments we've been making in the CP&E segment,” said Hooke, “particularly given the lower risk nature of the cash flows and the visibility we have into the cash generating capacity of the projects over time.” MIC has invested as the sponsor equity in contracted power projects to date, but has indicated that it could also make tax equity investments in contracted power projects if it was able to utilize the tax credits.

At the end of the second quarter MIC had proportionately combined cash and long term debt of $84.6 million and $1471.4 million, respectively. At the same point, its operating companies had access to undrawn credit facilities totaling approximately $677.5 million. Subsequent to the quarter end, pro forma for the capital raise associated with the acquisition of the remainder of IMTT and the effect of the IMTT acquisition, MIC had cash and long term debt of approximately $240.0 million and $2,330.0 million, respectively, and undrawn credit facilities totaling $927.5 million including a new revolving credit facility of $250.0 million at the MIC level. The cash and undrawn credit facilities are available to fund future growth capital projects, acquisitions by MIC's existing businesses and/or for general corporate purposes.

Consolidated Results for Second Quarter and Six Months

MIC reported net income, before tax, of $15.2 million for the second quarter of 2014 compared with a net loss of $2.0 million for the second quarter of 2013. For the six months ended June 30, 2014, MIC reported net income, before tax, of $43.9 million compared with net income of $9.2 million for the comparable period in 2013. The improvement was primarily attributable to an increase in gross profit and a decrease in combined base management and performance fees incurred in 2014. Combined fees were $14.5 million and $23.5 million in the quarter and year to date periods, respectively, down from $32.5 million and $61.7 million in comparable periods in 2013.

MIC's consolidated revenue for the second quarter of 2014 rose 11.2% to $280.9 million compared with $252.6 million in the second quarter of 2013. Consolidated revenue increased 7.8% for the six-month period ended June 30, 2014 versus the comparable period in 2013. The increases reflect a growth in the volume of products sold and higher energy costs, such as those for aviation fuel, which are passed through to customers of MIC's businesses, as well as increased contributions from the Company's CP&E segment.

Reported gross profit – defined as revenue less cost of goods sold – removes the volatility in revenue associated with fluctuations in energy costs. MIC's consolidated gross profit rose 13.2% to $114.8 million in the second quarter of 2014 from $101.4 million in the same period in 2013. For the six months ended June 30, 2014, the Company's gross profit increased 10.5% versus the comparable period in 2013.

The increase in MIC's consolidated operating income for the quarter and six months ended June 30, 2014 reflects, lower base and performance fees incurred, improved results at Atlantic Aviation and increased contributions from the CP&E segment and the non-utility portion of Hawaii Gas, partially offset by higher selling, general and administrative expenses. The increased expenses were principally legal and transaction-related items incurred in connection with acquisitions on behalf of Atlantic Aviation and CP&E and costs incurred in connection with the IMTT acquisition.

Cash Generation

MIC reports EBITDA excluding non-cash items on a consolidated and operating segment basis and reconciles each to consolidated net income (loss). EBITDA excluding non-cash items is a measure relied upon by management in evaluating the performance of its businesses and investments. EBITDA excluding non-cash items is defined as earnings before interest, taxes, depreciation and amortization and non-cash items, which may include impairments, gains and losses on derivatives and adjustments for certain other items reflected in the statement of operations.

MIC believes that EBITDA excluding non-cash items provides additional insight into the performance of its operating businesses, relative to each other and to similar businesses without regard to capital structure, and into their ability to service or reduce debt, fund capital expenditures and/or support distributions to the holding company.

MIC also reports Free Cash Flow, as defined below, on both a consolidated and an operating segment basis as a means of assessing the amount of cash generated by its businesses and as a supplement to other information provided in accordance with GAAP, and reconciles each to cash from operating activities. MIC believes that reporting Free Cash Flow provides additional insight into its ability to deploy cash as GAAP measures, such as net income (loss) and cash from operating activities, do not reflect all of the items that management considers in estimating the amount of cash generated by its operating businesses. MIC defines Free Cash Flow as cash from operating activities, which includes cash paid for interest, taxes and pension contributions, less maintenance capital expenditures and changes in working capital.

Free Cash Flow does not fully reflect MIC's ability to freely deploy generated cash, as it does not reflect required payments on indebtedness and other fixed obligations or the other cash items excluded when calculating Free Cash Flow. Free Cash Flow may be calculated in a different manner by other companies, which limits its usefulness as a comparative measure. Free Cash Flow should be used as a supplemental measure and not in lieu of MIC's financial results as reported under GAAP.

MIC may report certain financial metrics on a proportionately combined basis including proportionately combined gross profit, proportionately combined EBITDA excluding non-cash items, proportionately combined cash interest, proportionately combined cash taxes, proportionately combined maintenance capital expenditures, proportionately combined Free Cash Flow, proportionately combined Free Cash Flow per share, proportionately combined growth capital expenditures and proportionately combined net debt. When we refer to proportionately combined net debt and resultant leverage ratios, we exclude net debt associated with CP&E as the capital structure of that business is more project finance related and the size of that reporting segment, on a proportionately combined basis, is minimal. The Company believes that such measures provide investors and management with additional insight into the financial results and cash generated on the basis of its varied ownership interests in its businesses and investments for the reporting periods.

Proportionately combined metrics used by MIC may be calculated in a different manner by other companies and may limit their usefulness as a comparative measure. Proportionately combined metrics should be used as a supplement to and not in lieu of financial results reported in accordance with GAAP.

The following tables summarize MIC's financial performance on a proportionately combined basis for the quarter and six-month periods ended June 30, 2014, and for the prior comparable periods.

		For the Quarter Ended June 30, 2014
								Contracted									Contracted
						Atlantic		Power and				Proportionately					Power and
($ in Thousands) (Unaudited)		IMTT 50%		Hawaii Gas		Aviation		Energy(2)		MIC Corporate		Combined(1)			IMTT 100%		Energy 100%
Gross profit		38,523		19,400		86,460		5,681		N/A		150,064			77,046		8,989
EBITDA excluding non-cash items		34,718		14,980		39,416		4,544		(2,046)		91,611			69,435		8,024
Free cash flow		16,111		7,780		30,464		2,128		216		56,699			32,221		4,048
		For the Quarter Ended June 30, 2013(3)
								Contracted									Contracted
						Atlantic		Power and				Proportionately					Power and
($ in Thousands) (Unaudited)		IMTT 50%		Hawaii Gas		Aviation		Energy(2)		MIC Corporate		Combined(1)			IMTT 100%		Energy 100%
Gross profit		37,671		17,147		77,839		3,554		N/A		136,211			75,342		6,450
EBITDA excluding non-cash items		33,965		11,411		34,845		3,463		(1,904)		81,780			67,930		6,798
Free cash flow		12,145		6,489		26,332		2,343		(331)		46,978			24,290		4,682
		For the Six Months Ended June 30, 2014
								Contracted									Contracted
						Atlantic		Power and				Proportionately					Power and
($ in Thousands) (Unaudited)		IMTT 50%		Hawaii Gas		Aviation		Energy(2)		MIC Corporate		Combined(1)			IMTT 100%		Energy 100%
Gross profit		81,019		39,372		173,669		9,248		N/A		303,308			162,037		14,810
EBITDA excluding non-cash items		74,454		29,971		79,452		8,422		(2,904)		189,395			148,908		14,520
Free cash flow		37,527		16,416		62,231		3,740		1,705		121,619			75,053		6,823
		For the Six Months Ended June 30, 2013(3)
								Contracted									Contracted
						Atlantic		Power and				Proportionately					Power and
($ in Thousands) (Unaudited)		IMTT 50%		Hawaii Gas		Aviation		Energy(2)		MIC Corporate		Combined(1)			IMTT 100%		Energy 100%
Gross profit		74,318		37,564		157,473		6,043		N/A		275,398			148,636		11,189
EBITDA excluding non-cash items		66,742		27,126		70,863		6,004		(3,369)		167,366			133,484		11,891
Free cash flow		29,345		16,429		53,424		3,658		4,204		107,060			58,689		7,410

N/A- Not applicable.
(1) Proportionately combined Free Cash Flow is equal to the sum of Free Cash Flow attributable to MIC's ownership interest in each of its operating businesses and MIC Corporate.
(2) Proportionately combined Free Cash Flow for Contracted Power and Energy is equal to MIC's controlling ownership interest in its solar power generation and district energy businesses.
(3) Reclassified to conform to current period presentation.

IMTT

At the end of the second quarter, MIC had a 50% equity interest in IMTT, the operator of one of the largest independent bulk liquid storage terminal businesses in the U.S. On July 16, 2014, MIC completed the acquisition of the remaining 50% interest in IMTT that it did not already own. IMTT is the owner and operator of 10 marine storage terminals in the U.S. and is the part owner and operator of two terminals in Canada. The terminals store and handle a wide variety of petroleum grades, chemicals and vegetable and animal oils. To aid in meaningful analysis of the performance of IMTT across periods, discussion below refers to results for 100% of the business, not MIC's 50% interest at June 30, 2014.

For the quarter and year to date periods ended June 30, 2014 versus the prior comparable periods in 2013, respectively:

• terminal revenue increased 1.2% and 5.7%
• capacity utilization was 91.6% and 92.1%
• maintenance capital expenditures decreased 43.7% and 43.0%
• Free Cash Flow increased 32.7% and 27.9%

Terminal revenue growth in the second quarter reflected an anticipated level of capacity utilization, a slightly lower than average number of contract renewals and a continuation of the stable pricing growth environment. The pricing environment at IMTT has been unchanged for the past four quarters. Terminal heating and throughput revenue in the second quarter were down on the prior comparable period. Year to date growth in terminal revenue reflects similar factors and the impact of above-average heating and throughput revenue in the first quarter.

As previously disclosed, capacity utilization continued to be lower than the historical average for the business as a number of tanks were off line for cleaning and inspection in the second quarter. MIC reported more than 700,000 barrels of storage capacity out of service for cleaning and inspection during the quarter ended June 30, 2014. Utilization and terminal revenue are expected to increase as and when these tanks are returned to service.

Reported terminal operating expenses were higher in the second quarter of 2014 compared with the second quarter of 2013 as a result of the absence of insurance recoveries related to Hurricane Sandy. The lack of the expense offset had a corresponding impact on EBITDA excluding non-cash items and limited the quarter over quarter increase to 2.2%. Excluding the impact of these recoveries from the 2013 results, the increase in EBITDA excluding non-cash items in the second quarter of 2014 over the prior comparable period would have been 8.6%.

Maintenance capital expenditures were lower in the 2014 periods primarily as a result of the absence of expenditures incurred in 2013 in connection with the restoration of the Bayonne facility following Hurricane Sandy partially offset by the higher level of tank cleaning and inspections.

Taxes at IMTT increased in the quarter and year to date periods as a result of the business' improved performance, particularly in the first quarter. Prior to acquiring the remainder of IMTT, MIC believed that IMTT's standalone federal income tax liability could have been offset with certain tax minimization strategies. However, the acquisition of the remainder of IMTT in early July crystallized IMTT's tax liability for the first half of the year and rendered tax mitigation strategies at IMTT in 2014 unnecessary as any federal tax liability generated by IMTT in the remainder of the year is expected to be offset in consolidation with the application of MIC level NOLs.

Free Cash Flow generated by IMTT increased 32.7% and 27.9% to $32.2 million and $75.1 million for the quarter and six months ended June 30, 2014, respectively. The increase reflects lower maintenance capital expenditures and improved operating results, partially offset by the increased tax provision.

IMTT did not make a distribution to either of its shareholders for the second quarter as a result of the sale of the interest owned by the Coleman family trust to MIC being pending at quarter end.

Hawaii Gas

Hawaii Gas is the owner and operator of the only regulated (“utility”) gas processing and pipeline distribution network on the islands of Hawaii. The business is also the owner and operator of the largest unregulated (“non-utility”) gas distribution operation on the islands. MIC owns 100% of Hawaii Gas.

For the quarter and year to date periods ended June 30, 2014 versus the prior comparable periods in 2013, respectively:

• non-utility contribution margin increased 15.5% and 2.5%
• utility contribution margin increased 1.9% and decreased 0.9%
• maintenance capital expenditures decreased 11.7% and increased 10.8%
• Free Cash Flow increased 19.9% and was flat

The volume of gas sold by the non-utility portion of the business increased by 5.6% and 1.9% for the quarter and six months ended June 30, 2014, respectively. Adjusted for increases in tank capacity utilization, the volume increases were 3.1% and 2.6%. The volume of gas sold by the utility portion of the business decreased by 1.1% and 1.8% in the quarter and six months ended June 30, 2014, respectively, reflecting reduced demand from certain industrial customers and overall lower residential consumption.

The availability of local supplies of LPG improved in the second quarter compared with the prior comparable period. As a result, Hawaii Gas purchased approximately 63% of its LPG from off-island sources in the second quarter of 2014 compared with 95% in the second quarter of 2013. Longer term supply reliability remains uncertain and Hawaii Gas is pursuing several initiatives including expanding storage capacity and diversifying the supply base to mitigate this risk.

Following approval from the Hawaii Public Utilities Commission in March, Hawaii Gas began moving containerized Liquefied Natural Gas (LNG) from the U.S. mainland to Hawaii in the second quarter. The LNG will be used initially as a supplement to its naphtha-based synthetic natural gas distribution operations on the island of Oahu. Hawaii Gas continues to work on initiatives to expand its use of containerized LNG and develop large-scale bulk LNG storage and distribution operations in Hawaii.

The increase in Free Cash Flow generated by Hawaii Gas during the second quarter reflects improved operating results including the absence of severance costs incurred in 2013 and lower maintenance capital expenditures, partially offset by an increased provision for taxes. On a year to date basis, improved performance was offset by higher taxes and maintenance capital expenditures and the fact that cash pension contributions were not excluded from the calculation of Free Cash Flow in the prior period.

Atlantic Aviation

Atlantic Aviation owns and operates a network of fixed-base operations (FBO) that primarily provide fuel, terminal and aircraft hangar services to owners and operators of general aviation (GA) aircraft at 68 airports throughout the U.S. The network is the largest of its kind in the U.S. air transportation industry.

For the quarter and year to date periods ended June 30, 2014 versus the prior comparable periods in 2013, respectively:

• total gross profit growth of 11.1% and 10.3%
• same store gross profit growth of 5.1% and 6.9%
• maintenance capital expenditures decreased 65.6% and 59.2%
• Free Cash Flow increased 15.7% and 16.5%

The recovery in general aviation flight activity in the U.S. following the global financial crisis in 2008/2009 continued in the second quarter of 2014. Atlantic Aviation's results benefitted from the increased activity, acquisitions of a total of seven FBOs, and same store increases in both the volume of fuel sold and the average margin on fuel sales. Atlantic Aviation's results included the contribution from an FBO acquired in December of 2013 and a network of six FBOs acquired in a transaction that closed on April 30, 2014 (the “Galaxy Acquisitions”).

Selling, general and administrative expenses, as well as depreciation and amortization, increased in the second quarter of 2014 compared with the second quarter in 2013 primarily as a result of the acquisitions concluded during the prior twelve months.

The acquisitions, including related borrowings of $100.0 million, together with the refinancing of the long-term debt of Atlantic Aviation late in the second quarter of 2013, also contributed to an increase in cash interest expense of approximately $2.9 million in the second quarter of 2014 versus the prior comparable period.

Maintenance capital expenditures at Atlantic Aviation were lower in the quarter and year to date periods ended June 30, 2014 as a result of differences in timing of spending on maintenance projects and lower anticipated spending overall in 2014 versus 2013.

The increase in Free Cash Flow generated by Atlantic Aviation reflects primarily the improved operating results, including the contribution from acquisitions, and the lower maintenance capital expenditures and tax provision, partially offset by the increased cash interest payments.

Contracted Power and Energy Segment

At the end of the second quarter MIC's CP&E segment comprised controlling interests in five contracted power generating facilities (solar photovoltaic) in the Southwest U.S. and in a district energy business headquartered in Chicago. In July, MIC acquired a controlling interest in an additional contracted power generating facility (wind) in New Mexico. The previously announced sale of the district energy business is currently pending and is expected to close as anticipated in the third quarter, subject to satisfaction of customary closing conditions. To aid in meaningful analysis of the performance of the CP&E segment across periods, the discussion below refers to results for 100% of the businesses in the segment, not MIC's controlling interests at June 30.

MIC's CP&E segment produced an increase in total revenue of 20.4% and 18.7% in the quarter and year to date periods ended June 30, 2014, respectively, primarily as a result of the commencement of operations of additional contracted power facilities during the preceding year. The revenue growth was partially offset by increased selling, general and administrative expenses related to the additional facilities and to transaction-related expenses. Together these produced an increase in EBITDA of 18.0% or $1.2 million compared with the second quarter in 2013 and an increase of 22.1% or $2.6 million for the year to date period.

Free Cash Flow generated by CP&E decreased 13.5% to $4.0 million in the second quarter of 2014 compared with the second quarter of 2013. Free Cash Flow generated in the first half of 2014 decreased 7.9% to $6.8 million versus the prior comparable period. The decreases were primarily due to higher transaction-related expenses, higher cash interest expense, an increase in the provision for taxes and higher maintenance capital expenditures partially offset by improved operating results.

Business Outlook

As a result of the acquisition in early July of the remaining interest in IMTT that it did not already own and the acquisition of an interest in an additional contracted power and energy facility, MIC has revised its outlook regarding financial performance for full year 2014 with respect to certain expenses, taxes and Free Cash Flow per share.

• Expenses related to the various transactions to which the Company has been a party, along with an agreed upon pension contribution at IMTT, are expected to be approximately $30.0 million and to be recorded in the third quarter.
• Cash taxes payable in relation to the performance of IMTT during the period January 1, 2014 through the IMTT transaction closing date of July 16, 2014 are expected to be in a range of approximately $16.6 million.
• Interest expense is expected to increase as a result of the issuance of $350.0 million of senior convertible notes in connection with the IMTT acquisition and commitment fees associated with a $250.0 million (undrawn) revolving credit facility at the MIC level.
• The sale of the district energy business within MIC's CP&E segment is expected to conclude in the third quarter of 2014. For purposes of Free Cash Flow projections, the proceeds of the sale are not assumed to be reinvested.
• Taking into consideration the expected contribution from IMTT from the date of closing of the acquisition on July 16 through year end, along with the dilution associated with the shares issued in connection with the financing of the transaction, the Company has provided guidance for Free Cash Flow per share in 2014 of $4.55 per share.

Conference Call and WEBCAST

When: Management has scheduled a conference call for 8:00 a.m. Eastern Time on Thursday, July 31, 2014 during which it will review the Company's results and answer questions from analysts and investors.

How: To listen to the conference call, please dial +1(650) 521-5252 at least 10 minutes prior to the scheduled start time. A webcast of the call will be accessible via the Company's website at www.macquarie.com/mic. Please allow extra time prior to the call to visit the site and download the necessary software to listen to the webcast.

Slides: The Company will prepare materials in support of its conference call presentation. The materials will be available for downloading from the Company's website the morning of July 31, 2014 prior to the conference call. A link to the materials will be located on the homepage of the MIC website.

Replay: For interested individuals unable to participate in the live conference call, a replay will be available after 2:00 p.m. on July 31, 2014 through August 7, 2014, at +1(404) 537-3406, Passcode: 93685696. An online archive of the webcast will be available on the Company's website for one year following the call. MIC-G

About Macquarie Infrastructure Company

Macquarie Infrastructure Company owns, operates and invests in a diversified group of infrastructure businesses providing basic services to customers in the United States. Its businesses consist of a gas processing and distribution business, Hawaii Gas, a bulk liquid terminals business, International-Matex Tank Terminals and controlling interests in several entities comprising a Contracted Power and Energy segment. MIC also owns and operates an airport services business, Atlantic Aviation. The Company is managed by a wholly-owned subsidiary of the Macquarie Group. For additional information, please visit the Macquarie Infrastructure Company website at www.macquarie.com/mic.

Forward-Looking Statements

This press release contains forward-looking statements. MIC may, in some cases, use words such as "project”, "believe”, "anticipate”, "plan”, "expect”, "estimate”, "intend”, "should”, "would”, "could”, "potentially”, or "may” or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. Forward-looking statements in this report are subject to a number of risks and uncertainties, some of which are beyond MIC's control including, among other things: changes in general economic or business conditions; its ability to service, comply with the terms of and refinance debt, successfully integrate and manage acquired businesses, retain or replace qualified employees, manage growth, make and finance future acquisitions, and implement its strategy; its shared decision-making with co-investors over investments including the distribution of dividends; its regulatory environment establishing rate structures and monitoring quality of service, demographic trends, the political environment, the economy, tourism, construction and transportation costs, air travel, environmental costs and risks, fuel and gas costs; its ability to recover increases in costs from customers, reliance on sole or limited source suppliers, risks or conflicts of interests involving its relationship with the Macquarie Group and changes in U.S. federal tax law.

MIC's actual results, performance, prospects or opportunities could differ materially from those expressed in or implied by the forward-looking statements. Additional risks of which MIC is not currently aware could also cause its actual results to differ. In light of these risks, uncertainties and assumptions, you should not place undue reliance on any forward-looking statements. The forward-looking events discussed in this release may not occur. These forward-looking statements are made as of the date of this release. MIC undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

“Macquarie Group” refers to the Macquarie Group of companies, which comprises Macquarie Group Limited and its worldwide subsidiaries and affiliates. Macquarie Infrastructure Company LLC is not an authorized deposit-taking institution for the purposes of the Banking Act 1959 (Commonwealth of Australia) and its obligations do not represent deposits or other liabilities of Macquarie Bank Limited ABN 46 008 583 542 (MBL). MBL does not guarantee or otherwise provide assurance in respect of the obligations of Macquarie Infrastructure Company LLC.

MACQUARIE INFRASTRUCTURE COMPANY LLC
CONSOLIDATED CONDENSED BALANCE SHEETS
($ In Thousands, Except Share Data)
		June 30,				December 31,
		2014				2013
ASSETS		(Unaudited)
Current assets:
Cash and cash equivalents		$	84,583			$	233,373
Restricted cash			29,036				51,884
Accounts receivable, less allowance for doubtful accounts of $961 and $953, respectively			71,487				60,823
Inventories			26,942				25,834
Prepaid expenses			6,251				10,132
Deferred income taxes			4,567				6,197
Equipment lease receivables current			8,831				8,515
Other			13,179				9,792
Total current assets			244,876				406,550
Property, equipment, land and leasehold improvements, net			894,665				854,169
Equipment lease receivables non-current			13,840				16,155
Investment in unconsolidated business			71,434				83,703
Goodwill			596,627				514,494
Intangible assets, net			693,366				592,850
Deferred financing costs, net of accumulated amortization			22,843				22,740
Other			4,854				10,204
Total assets		$	2,542,505			$	2,500,865
LIABILITIES AND MEMBERS' EQUITY
Current liabilities:
Due to manager - related party		$	8,370			$	3,032
Accounts payable			31,029				28,850
Accrued expenses			32,100				42,713
Current portion of long-term debt			158,687				163,083
Fair value of derivative instruments			10,542				13,027
Other			25,715				20,747
Total current liabilities			266,443				271,452
Long-term debt, net of current portion			923,581				831,027
Deferred income taxes			198,331				189,719
Other			58,014				55,399
Total liabilities			1,446,369				1,347,597
Commitments and contingencies			-				-
Members' equity:
LLC interests, or shares, no par value; 500,000,000 authorized; 56,636,240 shares issued and outstanding at June 30, 2014 and 56,295,595 shares issued and outstanding at December 31, 2013			1,140,909				1,226,733
Additional paid in capital			21,447				21,447
Accumulated other comprehensive loss			(8,273	)			(8,445	)
Accumulated deficit			(167,441	)			(197,507	)
Total members' equity			986,642				1,042,228
Noncontrolling interests			109,494				111,040
Total equity			1,096,136				1,153,268
Total liabilities and equity		$	2,542,505			$	2,500,865

MACQUARIE INFRASTRUCTURE COMPANY LLC
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
($ In Thousands, Except Share and Per Share Data)
		Quarter Ended								Six Months Ended
		June 30,				June 30,				June 30,				June 30,
		2014				2013				2014				2013
Revenue
Revenue from product sales		$	188,087			$	167,181			$	371,888			$	341,296
Revenue from product sales - utility			37,117				34,193				72,262				71,114
Service revenue			55,029				50,286				111,531				102,401
Financing and equipment lease income			710				907				1,457				1,962
Total revenue			280,943				252,567				557,138				516,773
Costs and expenses
Cost of product sales			121,332				109,594				244,249				226,587
Cost of product sales - utility			31,926				29,464				61,306				60,953
Cost of services			12,836				12,073				23,732				23,007
Selling, general and administrative			56,836				52,120				112,300				101,329
Fees to manager - related party			14,495				32,493				23,489				61,670
Depreciation			12,428				9,436				24,582				18,691
Amortization of intangibles			9,456				8,620				18,221				17,248
Loss from customer contract termination			-				1,626				-				1,626
Loss on disposal of assets			866				3				866				176
Total operating expenses			260,175				255,429				508,745				511,287
Operating income (loss)			20,768				(2,862	)			48,393				5,486
Other income (expense)
Interest income			31				49				95				143
Interest expense(1)			(17,945	)			(7,737	)			(31,956	)			(15,423	)
Loss on extinguishment of debt			-				(2,472	)			-				(2,472	)
Equity in earnings and amortization charges of investee			10,799				11,289				25,086				21,751
Other income (expense), net			1,576				(313	)			2,257				(315	)
Net income (loss) before income taxes			15,229				(2,046	)			43,875				9,170
(Provision) benefit for income taxes(2)			(5,485	)			1,090				(13,971	)			(3,412	)
Net income (loss)		$	9,744			$	(956	)		$	29,904			$	5,758
Less: net income (loss) attributable to noncontrolling interests			44				(108	)			(162	)			735
Net income (loss) attributable to MIC LLC		$	9,700			$	(848	)		$	30,066			$	5,023
Basic income (loss) per share attributable to MIC LLC		$	0.17			$	(0.02	)		$	0.53			$	0.10
Weighted average number of shares outstanding: basic			56,559,924				50,889,021				56,465,136				49,245,969
Diluted income (loss) per share attributable to MIC LLC		$	0.17			$	(0.02	)		$	0.53			$	0.10
Weighted average number of shares outstanding: diluted			56,572,519				50,889,021				56,477,888				49,263,383
Cash dividends declared per share		$	0.95			$	0.875			$	1.8875			$	1.5625

(1) Interest expense includes losses on derivative instruments of $8.6 million and $13.9 million for the quarter and six months ended June 30, 2014, respectively, of which net losses of $269,000 and $508,000, respectively, were reclassified from accumulated other comprehensive loss. For the quarter and six months ended June 30, 2013, interest expense includes losses on derivative instruments of $487,000 and $1.5 million, respectively, of which net losses of $423,000 and $821,000, respectively, were reclassified from accumulated other comprehensive loss.
(2) Includes $107,000 and $202,000 of benefit for income taxes from accumulated other comprehensive loss reclassifications for the quarter and six months ended June 30, 2014, respectively. For the quarter and six months ended June 30, 2013, benefit for income taxes includes $168,000 and $326,000 from accumulated other comprehensive loss reclassifications, respectively.

MACQUARIE INFRASTRUCTURE COMPANY LLC
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
($ In Thousands)
		Six Months Ended
		June 30, 2014				June 30, 2013
Operating activities
Net income		$	29,904			$	5,758
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of property and equipment			27,993				22,092
Amortization of intangible assets			18,221				17,248
Loss on disposal of assets			816				106
Loss from customer contract termination			-				1,626
Equity in earnings and amortization charges of investee			(25,086	)			(21,751	)
Equity distributions from investee			25,086				7,879
Amortization of debt financing costs			2,141				1,897
Loss on extinguishment of debt			-				2,434
Adjustments to derivative instruments			5,367				(3,289	)
Base management fees to be settled/settled in shares			18,529				15,188
Performance fees to be settled/settled in shares			4,960				46,482
Equipment lease receivable, net			2,028				2,074
Deferred rent			189				128
Deferred taxes			10,030				1,537
Other non-cash income, net			(319	)			(1,492	)
Changes in other assets and liabilities:
Restricted cash			25,262				(9,490	)
Accounts receivable			(10,851	)			(6,865	)
Inventories			(1,227	)			(2,338	)
Prepaid expenses and other current assets			877				4,081
Due to manager - related party			(51	)			31
Accounts payable and accrued expenses			270				(2,960	)
Income taxes payable			(313	)			(845	)
Other, net			(2,491	)			(2,434	)
Net cash provided by operating activities			131,335				77,097
Investing activities
Acquisitions of businesses and investments, net of cash acquired			(232,947	)			-
Return of investment in unconsolidated business			12,297				-
Purchases of property and equipment			(36,053	)			(38,450	)
Other, net			46				(10	)
Net cash used in investing activities			(256,657	)			(38,460	)
Financing activities
Proceeds from long-term debt			104,884				471,752
Dividends paid to shareholders			(104,502	)			(35,881	)
Proceeds from the issuance of shares			-				227,558
Offering and equity raise costs paid			(17	)			(11,006	)
Proceeds from the issuance of shares pursuant to MIC Direct			130				-
Contributions received from noncontrolling interests			-				22,362
Distributions paid to noncontrolling interests			(1,406	)			(1,189	)
Payment of long-term debt			(16,726	)			(732,037	)
Debt financing costs paid			(2,317	)			(18,906	)
Change in restricted cash			(2,599	)			5,009
Payment of notes and capital lease obligations			(915	)			(907	)
Net cash used in financing activities			(23,468	)			(73,245	)
Net change in cash and cash equivalents			(148,790	)			(34,608	)
Cash and cash equivalents, beginning of period			233,373				141,376
Cash and cash equivalents, end of period		$	84,583			$	106,768
Supplemental disclosures of cash flow information
Non-cash investing and financing activities:
Accrued equity offering costs		$	286			$	11
Accrued financing costs		$	322			$	93
Accrued purchases of property and equipment		$	2,501			$	2,769
Acquisition of equipment through capital leases		$	-			$	1,135
Issuance of shares to manager for performance fees		$	-			$	65,862
Issuance of shares to manager for base management fees		$	18,100			$	13,434
Issuance of shares to independent directors		$	750			$	640
Conversion of construction loan to term loan		$	60,360			$	-
Distributions payable to noncontrolling interests		$	406			$	288
Taxes paid		$	4,254			$	2,720
Interest paid		$	24,173			$	16,184

CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS – MD&A
										Change														Change
		Quarter Ended June 30,								Favorable/(Unfavorable)						Six Months Ended June 30,								Favorable/(Unfavorable)
		2014				2013				$			%			2014				2013				$			%
		($ In Thousands) (Unaudited)
Revenue
Revenue from product sales		$	188,087			$	167,181			20,906			12.5			$	371,888			$	341,296			30,592			9.0
Revenue from product sales - utility			37,117				34,193			2,924			8.6				72,262				71,114			1,148			1.6
Service revenue			55,029				50,286			4,743			9.4				111,531				102,401			9,130			8.9
Financing and equipment lease income			710				907			(197	)		(21.7	)			1,457				1,962			(505	)		(25.7	)
Total revenue			280,943				252,567			28,376			11.2				557,138				516,773			40,365			7.8
Costs and expenses
Cost of product sales			121,332				109,594			(11,738	)		(10.7	)			244,249				226,587			(17,662	)		(7.8	)
Cost of product sales - utility			31,926				29,464			(2,462	)		(8.4	)			61,306				60,953			(353	)		(0.6	)
Cost of services			12,836				12,073			(763	)		(6.3	)			23,732				23,007			(725	)		(3.2	)
Gross profit			114,849				101,436			13,413			13.2				227,851				206,226			21,625			10.5
Selling, general and administrative			56,836				52,120			(4,716	)		(9.0	)			112,300				101,329			(10,971	)		(10.8	)
Fees to manager - related party			14,495				32,493			17,998			55.4				23,489				61,670			38,181			61.9
Depreciation			12,428				9,436			(2,992	)		(31.7	)			24,582				18,691			(5,891	)		(31.5	)
Amortization of intangibles			9,456				8,620			(836	)		(9.7	)			18,221				17,248			(973	)		(5.6	)
Loss from customer contract termination			-				1,626			1,626			100.0				-				1,626			1,626			100.0
Loss on disposal of assets			866				3			(863	)		NM				866				176			(690	)		NM
Total operating expenses			94,081				104,298			10,217			9.8				179,458				200,740			21,282			10.6
Operating income (loss)			20,768				(2,862	)		23,630			NM				48,393				5,486			42,907			NM
Other income (expense)
Interest income			31				49			(18	)		(36.7	)			95				143			(48	)		(33.6	)
Interest expense(1)			(17,945	)			(7,737	)		(10,208	)		(131.9	)			(31,956	)			(15,423	)		(16,533	)		(107.2	)
Loss on extinguishment of debt			-				(2,472	)		2,472			100.0				-				(2,472	)		2,472			100.0
Equity in earnings and amortization charges of investee			10,799				11,289			(490	)		(4.3	)			25,086				21,751			3,335			15.3
Other income (expense), net			1,576				(313	)		1,889			NM				2,257				(315	)		2,572			NM
Net income (loss) before income taxes			15,229				(2,046	)		17,275			NM				43,875				9,170			34,705			NM
(Provision) benefit for income taxes			(5,485	)			1,090			(6,575	)		NM				(13,971	)			(3,412	)		(10,559	)		NM
Net income (loss)		$	9,744			$	(956	)		10,700			NM			$	29,904			$	5,758			24,146			NM
Less: net income (loss) attributable to noncontrolling interests			44				(108	)		(152	)		(140.7	)			(162	)			735			897			122.0
Net income (loss) attributable to MIC LLC		$	9,700			$	(848	)		10,548			NM			$	30,066			$	5,023			25,043			NM

NM - Not meaningful
(1) Interest expense includes losses on derivative instruments of $8.6 million and $13.9 million for the quarter and six months ended June 30, 2014, respectively. For the quarter and six months ended June 30, 2013, interest expense includes losses on derivative instruments of $487,000 and $1.5 million, respectively.

MACQUARIE INFRASTRUCTURE COMPANY LLC
RECONCILIATION OF CONSOLIDATED NET INCOME (LOSS) ATTRIBUTABLE TO MIC LLC TO
EBITDA EXCLUDING NON-CASH ITEMS AND CASH FROM OPERATING ACTIVITIES TO FREE CASH FLOW
										Change												Change
		Quarter Ended June 30,								Favorable/(Unfavorable)				Six Months Ended June 30,								Favorable/(Unfavorable)
		2014				2013				$		%		2014				2013				$		%
		($ In Thousands) (Unaudited)
Net income (loss) attributable to MIC LLC(1)		$	9,700			$	(848	)						$	30,066			$	5,023
Interest expense, net(2)			17,914				7,688								31,861				15,280
Provision (benefit) for income taxes			5,485				(1,090	)							13,971				3,412
Depreciation(3)			12,428				9,436								24,582				18,691
Depreciation - cost of services(3)			1,707				1,703								3,411				3,401
Amortization of intangibles(4)			9,456				8,620								18,221				17,248
Loss from customer contract termination			-				1,626								-				1,626
Loss on extinguishment of debt			-				2,434								-				2,434
Loss on disposal of assets			816				-								816				106
Equity in earnings and amortization charges of investee			(10,799	)			(11,289	)							(25,086	)			(21,751	)
Equity distributions from investee(5)			16,959				7,879								25,086				7,879
Base management fees to be settled/settled in shares			9,535				8,053								18,529				15,188
Performance fees to be settled/settled in shares			4,960				24,440								4,960				46,482
Other non-cash (income) expense, net			(828	)			377								(292	)			(629	)
EBITDA excluding non-cash items		$	77,333			$	59,029			18,304		31.0		$	146,125			$	114,390			31,735		27.7
EBITDA excluding non-cash items		$	77,333			$	59,029							$	146,125			$	114,390
Interest expense, net(2)			(17,914	)			(7,688	)							(31,861	)			(15,280	)
Adjustments to derivative instruments recorded in interest expense(2)			4,273				(1,950	)							5,367				(3,289	)
Amortization of debt financing costs(2)			1,100				950								2,141				1,897
Equipment lease receivables, net			1,032				1,107								2,028				2,074
Provision/benefit for income taxes, net of changes in deferred taxes			(1,894	)			(443	)							(3,941	)			(1,875	)
Pension contribution(6)			(825	)			-								(1,135	)			-
Changes in working capital			9,153				(7,577	)							12,611				(20,820	)
Cash provided by operating activities			72,258				43,428								131,335				77,097
Changes in working capital			(9,153	)			7,577								(12,611	)			20,820
Maintenance capital expenditures			(3,638	)			(5,954	)							(6,463	)			(8,571	)
Free cash flow		$	59,467			$	45,051			14,416		32.0		$	112,261			$	89,346			22,915		25.6

(1) Net income (loss) attributable to MIC LLC excludes net income attributable to noncontrolling interests of $44,000 and net loss attributable to noncontrolling interests of $162,000 for the quarter and six months ended June 30, 2014, respectively, and net loss attributable to noncontrolling interests of $108,000 and net income attributable to noncontrolling interests of $735,000 for the quarter and six months ended June 30, 2013, respectively.
(2) Interest expense, net, includes adjustment to derivative instruments and non-cash amortization of deferred financing fees.
(3) Depreciation − cost of services includes depreciation expense for our district energy business, a component of CP&E segment, which is reported in cost of services in our consolidated condensed statements of operations. Depreciation and Depreciation − cost of services does not include acquisition-related step-up depreciation expense of $2.0 million and $3.9 million for each of the quarters and six months ended June 30, 2014 and 2013, respectively, in connection with our investment in IMTT, which is reported in equity in earnings and amortization charges of investee in our consolidated condensed statements of operations.
(4) Amortization of intangibles does not include acquisition-related step-up amortization expense of $85,000 and $171,000 for each of the quarters and six months ended June 30, 2014 and 2013, respectively, in connection with our investment in IMTT, which is reported in equity in earnings and amortization charges of investee in our consolidated condensed statements of operations.
(5) Equity distributions from investee in the above table includes distributions we received only up to our share of the earnings recorded in the calculation for EBITDA excluding non-cash items.
(6) For the quarter and six months ended June 30, 2013, pension contribution of $900,000 and $1.4 million, respectively, were reported in changes in working capital for those periods.

MACQUARIE INFRASTRUCTURE COMPANY LLC
RECONCILIATION FROM CONSOLIDATED FREE CASH FLOW
TO PROPORTIONATELY COMBINED FREE CASH FLOW
										Change												Change
		Quarter Ended June 30,								Favorable/(Unfavorable)				Six Months Ended June 30,								Favorable/(Unfavorable)
		2014				2013				$		%		2014				2013				$		%
		($ In Thousands) (Unaudited)
Free Cash Flow- Consolidated basis		$	59,467			$	45,051			14,416		32.0		$	112,261			$	89,346			22,915		25.6
Equity distributions from investee(1)			(16,959	)			(7,879	)							(25,086	)			(7,879	)
100% of CP&E Free Cash Flow included in consolidated Free Cash Flow			(4,048	)			(4,682	)							(6,823	)			(7,410	)
MIC's share of IMTT Free Cash Flow			16,111				12,145								37,527				29,345
MIC's share of CP&E Free Cash Flow			2,128				2,343								3,740				3,658
Free Cash Flow- Proportionately Combined basis		$	56,699			$	46,978			9,721		20.7		$	121,619			$	107,060			14,559		13.6

(1) Equity distributions from investee represents the portion of distributions received from IMTT that are recorded in cash from operating activities. The distribution for the fourth quarter of 2013 from IMTT was received in the first quarter of 2014, as customary. Conversely, the distribution for the fourth quarter of 2012 from IMTT was received in the same period.

MACQUARIE INFRASTRUCTURE COMPANY LLC
RECONCILIATION OF SEGMENT NET INCOME (LOSS) TO EBITDA EXCLUDING NON-CASH
ITEMS AND CASH FROM OPERATING ACTIVITIES TO FREE CASH FLOW
IMTT
		Quarter Ended												Six Months Ended
		June 30,						Change						June 30,						Change
		2014			2013			Favorable/(Unfavorable)						2014			2013			Favorable/(Unfavorable)
		$			$			$			%			$			$			$			%
		($ In Thousands) (Unaudited)
Revenue
Terminal revenue		120,912			119,520			1,392			1.2			254,602			240,852			13,750			5.7
Environmental response revenue		21,606			6,301			15,305			NM			35,994			16,454			19,540			118.8
Total revenue		142,518			125,821			16,697			13.3			290,596			257,306			33,290			12.9
Costs and expenses
Terminal operating costs(1)		49,790			44,906			(4,884	)		(10.9	)		101,637			95,210			(6,427	)		(6.8	)
Environmental response operating costs		15,682			5,573			(10,109	)		(181.4	)		26,922			13,460			(13,462	)		(100.0	)
Total operating costs		65,472			50,479			(14,993	)		(29.7	)		128,559			108,670			(19,889	)		(18.3	)
Terminal gross profit		71,122			74,614			(3,492	)		(4.7	)		152,965			145,642			7,323			5.0
Environmental response gross profit		5,924			728			5,196			NM			9,072			2,994			6,078			NM
Gross profit		77,046			75,342			1,704			2.3			162,037			148,636			13,401			9.0
General and administrative expenses		10,497			7,854			(2,643	)		(33.7	)		18,363			16,336			(2,027	)		(12.4	)
Depreciation and amortization		19,646			18,636			(1,010	)		(5.4	)		37,920			37,058			(862	)		(2.3	)
Casualty losses, net(1)		-			6,500			6,500			100.0			-			6,500			6,500			100.0
Operating income		46,903			42,352			4,551			10.7			105,754			88,742			17,012			19.2
Interest expense, net(2)		(8,813	)		(1,117	)		(7,696	)		NM			(15,946	)		(7,723	)		(8,223	)		(106.5	)
Other income		1,377			442			935			NM			1,871			1,184			687			58.0
Provision for income taxes		(15,455	)		(16,592	)		1,137			6.9			(36,557	)		(33,713	)		(2,844	)		(8.4	)
Noncontrolling interest		(9	)		(101	)		92			91.1			(138	)		(176	)		38			21.6
Net income		24,003			24,984			(981	)		(3.9	)		54,984			48,314			6,670			13.8
Reconciliation of net income to EBITDA excluding non-cash items and cash provided by operating activities to Free Cash Flow:
Net income		24,003			24,984									54,984			48,314
Interest expense, net(2)		8,813			1,117									15,946			7,723
Provision for income taxes		15,455			16,592									36,557			33,713
Depreciation and amortization		19,646			18,636									37,920			37,058
Casualty losses, net(1)		-			6,500									-			6,500
Other non-cash expenses(3)		1,518			101									3,501			176
EBITDA excluding non-cash items		69,435			67,930			1,505			2.2			148,908			133,484			15,424			11.6
EBITDA excluding non-cash items		69,435			67,930									148,908			133,484
Interest expense, net(2)		(8,813	)		(1,117	)								(15,946	)		(7,723	)
Adjustments to derivative instruments recorded in interest expense(2)		(2,513	)		(9,607	)								(6,649	)		(14,016	)
Amortization of debt financing costs(2)		843			500									1,687			1,166
Provision for income taxes, net of changes in deferred taxes		(11,612	)		(6,538	)								(26,721	)		(8,223	)
Changes in working capital		(10,189	)		18,803									(4,941	)		1,416
Cash provided by operating activities		37,151			69,971									96,338			106,104
Changes in working capital		10,189			(18,803	)								4,941			(1,416	)
Maintenance capital expenditures(4)		(15,119	)		(26,878	)								(26,226	)		(45,999	)
Free cash flow		32,221			24,290			7,931			32.7			75,053			58,689			16,364			27.9

NM - Not meaningful
(1) Casualty losses, net, includes $2.5 million and $1.5 million related to the quarters ended December 31, 2012 and March 31, 2013, respectively, which were recorded in terminal operating costs in those periods. These amounts have been included in the quarter and six months ended June 30, 2013.
(2) Interest expense, net, includes adjustments to derivative instruments and non-cash amortization of deferred financing fees.
(3) IMTT management's calculation of IMTT's EBITDA includes various non-cash items, unlike MIC's other businesses. In order to ensure IMTT's EBITDA excluding non-cash items does in fact excludes non-cash items, and to promote consistency across its reporting segments, MIC has excluded known non-cash items when calculating IMTT's EBITDA excluding non-cash items including primarily the non-cash pension expense of $1.5 million and $3.3 million for the quarter and six months ended June 30, 2014, respectively. The non-cash pension expense of $2.8 million and $5.6 million was reported in changes in working capital for the quarter and six months ended June 30, 2013, respectively.
(4) Maintenance capital expenditures includes a reclassification from growth capital expenditures in the quarters ended December 31, 2012 and March 31, 2013 of $1.2 million and $509,000, respectively. These amounts have been included in the quarter and six months ended June 30, 2013.

Hawaii Gas
		Quarter Ended												Six Months Ended
		June 30,						Change						June 30,						Change
		2014			2013			Favorable/(Unfavorable)						2014			2013			Favorable/(Unfavorable)
		$			$			$			%			$			$			$			%
		($ In Thousands) (Unaudited)
Contribution margin
Revenue - non-utility		32,017			28,420			3,597			12.7			66,223			60,505			5,718			9.5
Cost of revenue - non-utility		14,588			13,333			(1,255	)		(9.4	)		31,551			26,687			(4,864	)		(18.2	)
Contribution margin - non-utility		17,429			15,087			2,342			15.5			34,672			33,818			854			2.5
Revenue - utility		37,117			34,193			2,924			8.6			72,262			71,114			1,148			1.6
Cost of revenue - utility		27,469			24,726			(2,743	)		(11.1	)		52,698			51,380			(1,318	)		(2.6	)
Contribution margin - utility		9,648			9,467			181			1.9			19,564			19,734			(170	)		(0.9	)
Total contribution margin		27,077			24,554			2,523			10.3			54,236			53,552			684			1.3
Production		2,397			2,667			270			10.1			4,781			5,382			601			11.2
Transmission and distribution (1)		5,280			4,740			(540	)		(11.4	)		10,083			10,606			523			4.9
Gross profit		19,400			17,147			2,253			13.1			39,372			37,564			1,808			4.8
Selling, general and administrative expenses		4,771			5,989			1,218			20.3			10,394			11,321			927			8.2
Depreciation and amortization		2,295			2,190			(105	)		(4.8	)		4,553			4,348			(205	)		(4.7	)
Operating income		12,334			8,968			3,366			37.5			24,425			21,895			2,530			11.6
Interest expense, net(2)		(1,891	)		(1,238	)		(653	)		(52.7	)		(3,678	)		(2,943	)		(735	)		(25.0	)
Other expense		(57	)		(73	)		16			21.9			(139	)		(105	)		(34	)		(32.4	)
Provision for income taxes		(4,092	)		(2,995	)		(1,097	)		(36.6	)		(8,119	)		(7,478	)		(641	)		(8.6	)
Net income(3)		6,294			4,662			1,632			35.0			12,489			11,369			1,120			9.9
Reconciliation of net income to EBITDA excluding non-cash items and cash provided by operating activities to Free Cash Flow:
Net income(3)		6,294			4,662									12,489			11,369
Interest expense, net(2)		1,891			1,238									3,678			2,943
Provision for income taxes		4,092			2,995									8,119			7,478
Depreciation and amortization		2,295			2,190									4,553			4,348
Other non-cash expenses(1)		408			326									1,132			988
EBITDA excluding non-cash items		14,980			11,411			3,569			31.3			29,971			27,126			2,845			10.5
EBITDA excluding non-cash items		14,980			11,411									29,971			27,126
Interest expense, net(2)		(1,891	)		(1,238	)								(3,678	)		(2,943	)
Adjustments to derivative instruments recorded in interest expense(2)		153			(617	)								146			(695	)
Amortization of debt financing costs(2)		121			123									239			229
Provision for income taxes, net of changes in deferred taxes		(2,625	)		(775	)								(5,336	)		(3,867	)
Pension contribution(4)		(825	)		-									(1,135	)		-
Changes in working capital		1,711			9,780									(3,777	)		(787	)
Cash provided by operating activities		11,624			18,684									16,430			19,063
Changes in working capital		(1,711	)		(9,780	)								3,777			787
Maintenance capital expenditures		(2,133	)		(2,415	)								(3,791	)		(3,421	)
Free cash flow		7,780			6,489			1,291			19.9			16,416			16,429			(13	)		(0.1	)

(1) For the quarter and six months ended June 30, 2013, transmission and distribution includes non-cash income of $518,000 for asset retirement obligation credit that is not expected to recur. This non-cash income is excluded when calculating EBITDA excluding non-cash items.
(2) Interest expense, net, includes adjustments to derivative instruments and non-cash amortization of deferred financing fees.
(3) Corporate allocation expense, intercompany fees and the tax effect have been excluded from the above table as they are eliminated on consolidation.
(4) For the quarter and six months ended June 30, 2013, pension contribution of $900,000 and $1.4 million, respectively, were reported in changes in working capital for those periods.

Atlantic Aviation
		Quarter Ended												Six Months Ended
		June 30,						Change						June 30,						Change
		2014			2013			Favorable/(Unfavorable)						2014			2013			Favorable/(Unfavorable)
		$			$			$			%			$			$			$			%
		($ In Thousands) (Unaudited)
Revenue
Fuel revenue		150,240			135,929			14,311			10.5			296,177			276,273			19,904			7.2
Non-fuel revenue		42,972			38,573			4,399			11.4			90,996			82,369			8,627			10.5
Total revenue		193,212			174,502			18,710			10.7			387,173			358,642			28,531			8.0
Cost of revenue
Cost of revenue-fuel		102,661			93,038			(9,623	)		(10.3	)		204,719			192,823			(11,896	)		(6.2	)
Cost of revenue-non-fuel		4,091			3,625			(466	)		(12.9	)		8,785			8,346			(439	)		(5.3	)
Total cost of revenue		106,752			96,663			(10,089	)		(10.4	)		213,504			201,169			(12,335	)		(6.1	)
Fuel gross profit		47,579			42,891			4,688			10.9			91,458			83,450			8,008			9.6
Non-fuel gross profit		38,881			34,948			3,933			11.3			82,211			74,023			8,188			11.1
Gross profit		86,460			77,839			8,621			11.1			173,669			157,473			16,196			10.3
Selling, general and administrative expenses		47,067			42,910			(4,157	)		(9.7	)		94,310			86,387			(7,923	)		(9.2	)
Depreciation and amortization		15,607			13,974			(1,633	)		(11.7	)		30,540			27,845			(2,695	)		(9.7	)
Loss on disposal of assets		866			3			(863	)		NM			866			176			(690	)		NM
Operating income		22,920			20,952			1,968			9.4			47,953			43,065			4,888			11.4
Interest expense, net(1)		(13,352	)		(4,626	)		(8,726	)		(188.6	)		(22,917	)		(8,725	)		(14,192	)		(162.7	)
Loss on extinguishment of debt		-			(2,472	)		2,472			100.0			-			(2,472	)		2,472			100.0
Other (expense) income		(15	)		4			(19	)		NM			(13	)		-			(13	)		NM
Provision for income taxes		(3,855	)		(5,426	)		1,571			29.0			(8,770	)		(12,824	)		4,054			31.6
Net income(2)		5,698			8,432			(2,734	)		(32.4	)		16,253			19,044			(2,791	)		(14.7	)
Reconciliation of net income to EBITDA excluding non-cash items and cash provided by operating activities to Free Cash Flow:
Net income(2)		5,698			8,432									16,253			19,044
Interest expense, net(1)		13,352			4,626									22,917			8,725
Provision for income taxes		3,855			5,426									8,770			12,824
Depreciation and amortization		15,607			13,974									30,540			27,845
Loss on extinguishment of debt		-			2,434									-			2,434
Loss on disposal of assets		816			-									816			106
Other non-cash expense (income)		88			(47	)								156			(115	)
EBITDA excluding non-cash items		39,416			34,845			4,571			13.1			79,452			70,863			8,589			12.1
EBITDA excluding non-cash items		39,416			34,845									79,452			70,863
Interest expense, net(1)		(13,352	)		(4,626	)								(22,917	)		(8,725	)
Adjustments to derivative instruments recorded in interest expense(1)		5,679			28									8,305			53
Amortization of debt financing costs(1)		785			648									1,516			1,309
Provision for income taxes, net of changes in deferred taxes		(882	)		(1,127	)								(2,126	)		(5,175	)
Changes in working capital		(1,274	)		1,735									(2,245	)		4,893
Cash provided by operating activities		30,372			31,503									61,985			63,218
Changes in working capital		1,274			(1,735	)								2,245			(4,893	)
Maintenance capital expenditures		(1,182	)		(3,436	)								(1,999	)		(4,901	)
Free cash flow		30,464			26,332			4,132			15.7			62,231			53,424			8,807			16.5

NM - Not meaningful
(1) Interest expense, net, includes adjustments to derivative instruments and non-cash amortization of deferred financing fees.
(2) Corporate allocation expense, intercompany fees and the tax effect have been excluded from the above table as they are eliminated on consolidation.

Contracted Power and Energy
		Quarter Ended												Six Months Ended
		June 30,						Change						June 30,						Change
		2014			2013			Favorable/(Unfavorable)						2014			2013			Favorable/(Unfavorable)
		$			$			$			%			$			$			$			%
		($ In Thousands) (Unaudited)
Product sales		5,830			2,832			2,998			105.9			9,488			4,518			4,970			110.0
Service revenue		12,057			11,713			344			2.9			20,535			20,032			503			2.5
Finance lease revenue		710			907			(197	)		(21.7	)		1,457			1,962			(505	)		(25.7	)
Total revenue		18,597			15,452			3,145			20.4			31,480			26,512			4,968			18.7
Cost of revenue — product		863			554			(309	)		(55.8	)		1,723			662			(1,061	)		(160.3	)
Cost of revenue — service(1)		8,745			8,448			(297	)		(3.5	)		14,947			14,661			(286	)		(2.0	)
Cost of revenue — total		9,608			9,002			(606	)		(6.7	)		16,670			15,323			(1,347	)		(8.8	)
Gross profit		8,989			6,450			2,539			39.4			14,810			11,189			3,621			32.4
Selling, general and administrative expenses		2,765			1,117			(1,648	)		(147.5	)		4,317			2,342			(1,975	)		(84.3	)
Depreciation		3,656			1,561			(2,095	)		(134.2	)		7,062			3,078			(3,984	)		(129.4	)
Amortization of intangibles		326			331			5			1.5			648			668			20			3.0
Loss from customer contract termination		-			1,626			1,626			100.0			-			1,626			1,626			100.0
Operating income		2,242			1,815			427			23.5			2,783			3,475			(692	)		(19.9	)
Interest expense, net(2)		(2,690	)		(1,865	)		(825	)		(44.2	)		(5,335	)		(3,742	)		(1,593	)		(42.6	)
Other income (expense), net		1,648			(254	)		1,902			NM			2,409			2,236			173			7.7
(Provision) benefit for income taxes		(616	)		548			(1,164	)		NM			(1,215	)		(1,415	)		200			14.1
Noncontrolling interest		570			172			398			NM			1,097			(256	)		1,353			NM
Net income (loss)		1,154			416			738			177.4			(261	)		298			(559	)		(187.6	)
Reconciliation of net income (loss) to EBITDA excluding non-cash items and cash provided by (used in) operating activities to Free Cash Flow:
Net income (loss)		1,154			416									(261	)		298
Interest expense, net(2)		2,690			1,865									5,335			3,742
Provision (benefit) for income taxes		616			(548	)								1,215			1,415
Depreciation(1)		5,363			3,264									10,473			6,479
Amortization of intangibles		326			331									648			668
Loss from customer contract termination		-			1,626									-			1,626
Other non-cash income		(2,125	)		(156	)								(2,890	)		(2,337	)
EBITDA excluding non-cash items		8,024			6,798			1,226			18.0			14,520			11,891			2,629			22.1
EBITDA excluding non-cash items		8,024			6,798									14,520			11,891
Interest expense, net(2)		(2,690	)		(1,865	)								(5,335	)		(3,742	)
Adjustments to derivative instruments recorded in interest expense(2)		(1,559	)		(1,361	)								(3,084	)		(2,647	)
Amortization of debt financing costs(2)		194			179									386			359
Equipment lease receivable, net		1,032			1,107									2,028			2,074
Provision/benefit for income taxes, net of changes in deferred taxes		(630	)		(73	)								(1,019	)		(276	)
Changes in working capital		9,698			(18,126	)								22,121			(17,252	)
Cash provided by (used in) operating activities		14,069			(13,341	)								29,617			(9,593	)
Changes in working capital		(9,698	)		18,126									(22,121	)		17,252
Maintenance capital expenditures		(323	)		(103	)								(673	)		(249	)
Free cash flow		4,048			4,682			(634	)		(13.5	)		6,823			7,410			(587	)		(7.9	)

NM - Not meaningful
(1) Includes depreciation expense related to our district energy business of $1.7 million and $3.4 million for each of the quarters and six months ended June 30, 2014 and 2013, respectively.
(2) Interest expense, net, includes adjustments to derivative instruments and non-cash amortization of deferred financing fees.

Corporate and Other
		Quarter Ended												Six Months Ended
		June 30,						Change						June 30,						Change
		2014			2013			Favorable/(Unfavorable)						2014			2013			Favorable/(Unfavorable)
		$			$			$			%			$			$			$			%
		($ In Thousands) (Unaudited)
Base management fees		9,535			8,053			(1,482	)		(18.4	)		18,529			15,188			(3,341	)		(22.0	)
Performance fees		4,960			24,440			19,480			79.7			4,960			46,482			41,522			89.3
Selling, general and administrative expenses		2,233			2,103			(130	)		(6.2	)		3,279			3,709			430			11.6
Operating loss		(16,728	)		(34,596	)		17,868			51.6			(26,768	)		(65,379	)		38,611			59.1
Interest income		19			41			(22	)		(53.7	)		69			130			(61	)		(46.9	)
Other income (expense), net		-			9			(9	)		(100.0	)		-			(16	)		16			100.0
Benefit for income taxes		3,078			8,963			(5,885	)		(65.7	)		4,133			18,305			(14,172	)		(77.4	)
Noncontrolling interest		(614	)		(64	)		(550	)		NM			(935	)		(479	)		(456	)		(95.2	)
Net loss(1)		(14,245	)		(25,647	)		11,402			44.5			(23,501	)		(47,439	)		23,938			50.5
Reconciliation of net loss to EBITDA excluding non-cash items and cash used in operating activities to Free Cash Flow:
Net loss(1)		(14,245	)		(25,647	)								(23,501	)		(47,439	)
Interest income		(19	)		(41	)								(69	)		(130	)
Benefit for income taxes		(3,078	)		(8,963	)								(4,133	)		(18,305	)
Base management fees to be settled/settled in shares		9,535			8,053									18,529			15,188
Performance fees to be settled/settled in shares		4,960			24,440									4,960			46,482
Other non-cash expense		801			254									1,310			835
EBITDA excluding non-cash items		(2,046	)		(1,904	)		(142	)		(7.5	)		(2,904	)		(3,369	)		465			13.8
EBITDA excluding non-cash items		(2,046	)		(1,904	)								(2,904	)		(3,369	)
Interest income		19			41									69			130
Benefit for income taxes, net of changes in deferred taxes		2,243			1,532									4,540			7,443
Changes in working capital		(982	)		(966	)								(3,488	)		(7,674	)
Cash used in operating activities		(766	)		(1,297	)								(1,783	)		(3,470	)
Changes in working capital		982			966									3,488			7,674
Free cash flow		216			(331	)		547			165.3			1,705			4,204			(2,499	)		(59.4	)

(1) Corporate allocation expense, intercompany fees and the tax effect have been excluded from the above table as they are eliminated on consolidation.

MACQUARIE INFRASTRUCTURE COMPANY LLC
RECONCILIATION OF PROPORTIONATELY COMBINED NET INCOME (LOSS) TO EBITDA
EXCLUDING NON-CASH ITEMS AND CASH FROM OPERATING ACTIVITIES TO FREE CASH
FLOW
		For the Quarter Ended June 30, 2014
($ in Thousands) (Unaudited)																								Contracted
								Atlantic			Contracted			MIC										Power and
					Hawaii			Aviation			Power and			Corporate			Proportionately				IMTT			Energy
		IMTT 50%			Gas 100%			100%			Energy(2)			100%			Combined(1)				100%			100%
Net income (loss) attributable to MIC LLC		12,002			6,294			5,698			761			(14,245	)		10,509				24,003			1,154
Interest expense (income), net(3)		4,407			1,891			13,352			1,779			(19	)		21,409				8,813			2,690
Provision (benefit) for income taxes		7,728			4,092			3,855			314			(3,078	)		12,911				15,455			616
Depreciation		9,587			1,983			6,789			3,561			-			21,920				19,174			5,363
Amortization of intangibles		236			312			8,818			163			-			9,529				472			326
Loss on disposal of assets		-			-			816			-			-			816				-			-
Base management fee to be settled in shares		-			-			-			-			9,535			9,535				-			-
Performance fees to be to be settled in shares		-			-			-			-			4,960			4,960				-			-
Other non-cash expense (income)(4)		759			408			88			(2,033	)		801			23				1,518			(2,125	)
EBITDA excluding non-cash items		34,718			14,980			39,416			4,544			(2,046	)		91,611				69,435			8,024
EBITDA excluding non-cash items		34,718			14,980			39,416			4,544			(2,046	)		91,611				69,435			8,024
Interest (expense) income, net(3)		(4,407	)		(1,891	)		(13,352	)		(1,779	)		19			(21,409	)			(8,813	)		(2,690	)
Adjustments to derivative instruments recorded in interest expense, net(3)		(1,257	)		153			5,679			(780	)		-			3,796				(2,513	)		(1,559	)
Amortization of deferred finance charges(3)		422			121			785			103			-			1,430				843			194
Equipment lease receivables, net		-			-			-			516			-			516				-			1,032
Provision/benefit for income taxes, net of changes in deferred taxes		(5,806	)		(2,625	)		(882	)		(315	)		2,243			(7,385	)			(11,612	)		(630	)
Pension contribution		-			(825	)		-			-			-			(825	)			-			-
Changes in working capital		(5,095	)		1,711			(1,274	)		8,411			(982	)		2,772				(10,189	)		9,698
Cash provided by (used in) operating activities		18,576			11,624			30,372			10,700			(766	)		70,506				37,151			14,069
Changes in working capital		5,095			(1,711	)		1,274			(8,411	)		982			(2,772	)			10,189			(9,698	)
Maintenance capital expenditures		(7,560	)		(2,133	)		(1,182	)		(162	)		-			(11,036	)			(15,119	)		(323	)
Free cash flow		16,111			7,780			30,464			2,128			216			56,699				32,221			4,048
		For the Quarter Ended June 30, 2013(8)
($ in Thousands) (Unaudited)																								Contracted
								Atlantic			Contracted			MIC										Power and
					Hawaii			Aviation			Power and			Corporate			Proportionately				IMTT			Energy
		IMTT 50%			Gas 100%			100%			Energy(2)			100%			Combined(1)				100%			100%
Net income (loss) attributable to MIC LLC		12,492			4,662			8,432			729			(25,647	)		668				24,984			416
Interest expense (income), net(3)		559			1,238			4,626			995			(41	)		7,376				1,117			1,865
Provision (benefit) for income taxes		8,296			2,995			5,426			(547	)		(8,963	)		7,207				16,592			(548	)
Depreciation		9,076			1,878			5,997			1,773			-			18,723				18,151			3,264
Amortization of intangibles		243			312			7,977			166			-			8,697				485			331
Loss from customer contract termination		-			-			-			813			-			813				-			1,626
Casualty losses, net(5)		3,250			-			-			-			-			3,250				6,500			-
Loss on extinguishment of debt		-			-			2,434			-			-			2,434				-			-
Base management fee settled in shares		-			-			-			-			8,053			8,053				-			-
Performance fee settled in shares		-			-			-			-			24,440			24,440				-			-
Other non-cash expense (income)(4)		51			326			(47	)		(466	)		254			117				101			(156	)
EBITDA excluding non-cash items		33,965			11,411			34,845			3,463			(1,904	)		81,780				67,930			6,798
EBITDA excluding non-cash items		33,965			11,411			34,845			3,463			(1,904	)		81,780				67,930			6,798
Interest (expense) income, net(3)		(559	)		(1,238	)		(4,626	)		(995	)		41			(7,376	)			(1,117	)		(1,865	)
Adjustments to derivative instruments recorded in interest expense, net(3)		(4,804	)		(617	)		28			(681	)		-			(6,073	)			(9,607	)		(1,361	)
Amortization of deferred finance charges(3)		250			123			648			91			-			1,112				500			179
Equipment lease receivables, net		-			-			-			554			-			554				-			1,107
Provision/benefit for income taxes, net of changes in deferred taxes		(3,269	)		(775	)		(1,127	)		(37	)		1,532			(3,676	)			(6,538	)		(73	)
Changes in working capital(6)		9,402			9,780			1,735			(15,047	)		(966	)		4,904				18,803			(18,126	)
Cash provided by (used in) operating activities		34,986			18,684			31,503			(12,652	)		(1,297	)		71,224				69,971			(13,341	)
Changes in working capital(6)		(9,402	)		(9,780	)		(1,735	)		15,047			966			(4,904	)			(18,803	)		18,126
Maintenance capital expenditures(7)		(13,439	)		(2,415	)		(3,436	)		(52	)		-			(19,342	)			(26,878	)		(103	)
Free cash flow		12,145			6,489			26,332			2,343			(331	)		46,978				24,290			4,682

(1) Proportionately combined Free Cash Flow is equal to the sum of Free Cash Flow attributable to MIC's ownership interest in each of its operating businesses and MIC Corporate.
(2) Proportionately combined Free Cash Flow for Contracted Power and Energy is equal to MIC's controlling ownership interest in its solar power generation and district energy businesses.
(3) Interest expense, net, includes adjustments to derivative instruments and non-cash amortization of deferred financing fees.
(4) IMTT management's calculation of IMTT's EBITDA includes various non-cash items, unlike MIC's other businesses. In order to ensure IMTT's EBITDA excluding non-cash items does in fact exclude non-cash items, and to promote consistency across its reporting segments, MIC has excluded known non-cash items when calculating IMTT's EBITDA excluding non-cash items including primarily the non-cash pension expense of $1.5 million for the quarter ended June 30, 2014. The non-cash pension expense of $2.8 million was reported in changes in working capital for the quarter ended June 30, 2013.
(5) Casualty losses, net, includes $2.5 million and $1.5 million related to the quarters ended December 31, 2012 and March 31, 2013, respectively, which were recorded in terminal operating costs in those periods. These amounts have been included in the quarter ended June 30, 2013.
(6) Pension contribution of $900,000 for Hawaii Gas for the quarter ended June 30, 2013 was reported in changes in working capital.
(7) Maintenance capital expenditures at IMTT includes a reclassification from growth capital expenditures in the quarters ended December 31, 2012 and March 31, 2013 of $1.2 million and $509,000, respectively. These amounts have been included in the quarter ended June 30, 2013
(8) Reclassified to conform with current period presentation.

MACQUARIE INFRASTRUCTURE COMPANY LLC
RECONCILIATION OF PROPORTIONATELY COMBINED NET INCOME (LOSS) TO EBITDA
EXCLUDING NON-CASH ITEMS AND CASH FROM OPERATING ACTIVITIES TO FREE CASH
FLOW
		For the Six Months Ended June 30, 2014
($ in Thousands) (Unaudited)																								Contracted
								Atlantic			Contracted			MIC										Power and
					Hawaii			Aviation			Power and			Corporate			Proportionately				IMTT			Energy
		IMTT 50%			Gas 100%			100%			Energy(2)			100%			Combined(1)				100%			100	%
Net income (loss) attributable to MIC LLC		27,492			12,489			16,253			1,286			(23,501	)		34,019				54,984			(261	)
Interest expense (income), net(3)		7,973			3,678			22,917			3,510			(69	)		38,009				15,946			5,335
Provision (benefit) for income taxes		18,279			8,119			8,770			743			(4,133	)		31,778				36,557			1,215
Depreciation		18,492			3,929			13,591			6,915			-			42,926				36,983			10,473
Amortization of intangibles		469			624			16,949			324			-			18,366				937			648
Base management fee settled/to be settled in shares		-			-			-			-			18,529			18,529				-			-
Performance fees to be settled in shares		-			-			-			-			4,960			4,960				-			-
Loss on disposal of assets		-			-			816			-			-			816				-			-
Other non-cash expense (income)(4)		1,751			1,132			156			(4,355	)		1,310			(7	)			3,501			(2,890	)
EBITDA excluding non-cash items		74,454			29,971			79,452			8,422			(2,904	)		189,395				148,908			14,520
EBITDA excluding non-cash items		74,454			29,971			79,452			8,422			(2,904	)		189,395				148,908			14,520
Interest (expense) income, net(3)		(7,973	)		(3,678	)		(22,917	)		(3,510	)		69			(38,009	)			(15,946	)		(5,335	)
Adjustments to derivative instruments recorded in interest expense, net(3)		(3,325	)		146			8,305			(1,542	)		-			3,584				(6,649	)		(3,084	)
Amortization of deferred finance charges(3)		844			239			1,516			203			-			2,802				1,687			386
Equipment lease receivables, net		-			-			-			1,014			-			1,014				-			2,028
Provision/benefit for income taxes, net of changes in deferred taxes		(13,361	)		(5,336	)		(2,126	)		(511	)		4,540			(16,793	)			(26,721	)		(1,019	)
Pension contribution		-			(1,135	)		-			-			-			(1,135	)			-			-
Changes in working capital		(2,471	)		(3,777	)		(2,245	)		18,942			(3,488	)		6,961				(4,941	)		22,121
Cash provided by (used in) operating activities		48,169			16,430			61,985			23,018			(1,783	)		147,819				96,338			29,617
Changes in working capital		2,471			3,777			2,245			(18,942	)		3,488			(6,961	)			4,941			(22,121	)
Maintenance capital expenditures		(13,113	)		(3,791	)		(1,999	)		(337	)		-			(19,240	)			(26,226	)		(673	)
Free cash flow		37,527			16,416			62,231			3,740			1,705			121,619				75,053			6,823
		For the Six Months Ended June 30, 2013(8)
($ in Thousands) (Unaudited)																								Contracted
								Atlantic			Contracted			MIC										Power and
					Hawaii			Aviation			Power and			Corporate			Proportionately				IMTT			Energy
		IMTT 50%			Gas 100%			100%			Energy(2)			100%			Combined(1)				100%			100%
Net income (loss) attributable to MIC LLC		24,157			11,369			19,044			1,011			(47,439	)		8,142				48,314			298
Interest expense (income), net(3)		3,862			2,943			8,725			1,979			(130	)		17,379				7,723			3,742
Provision (benefit) for income taxes		16,857			7,478			12,824			1,309			(18,305	)		20,162				33,713			1,415
Depreciation		18,193			3,724			11,889			3,494			-			37,300				36,386			6,479
Amortization of intangibles		336			624			15,956			334			-			17,250				672			668
Loss from customer contract termination		-			-			-			813			-			813				-			1,626
Casualty losses, net(5)		3,250			-			-			-			-			3,250				6,500			-
Loss on disposal of assets		-			-			106			-			-			106				-			-
Loss on extinguishment of debt		-			-			2,434			-			-			2,434				-			-
Base management fee settled in shares		-			-			-			-			15,188			15,188				-			-
Performance fee settled in shares		-			-			-			-			46,482			46,482				-			-
Other non-cash expense (income)(4)		88			988			(115	)		(2,935	)		835			(1,139	)			176			(2,337	)
EBITDA excluding non-cash items		66,742			27,126			70,863			6,004			(3,369	)		167,366				133,484			11,891
EBITDA excluding non-cash items		66,742			27,126			70,863			6,004			(3,369	)		167,366				133,484			11,891
Interest (expense) income, net(3)		(3,862	)		(2,943	)		(8,725	)		(1,979	)		130			(17,379	)			(7,723	)		(3,742	)
Adjustments to derivative instruments recorded in interest expense, net(3)		(7,008	)		(695	)		53			(1,324	)		-			(8,974	)			(14,016	)		(2,647	)
Amortization of deferred finance charges(3)		583			229			1,309			182			-			2,303				1,166			359
Equipment lease receivables, net		-			-			-			1,037			-			1,037				-			2,074
Provision/benefit for income taxes, net of changes in deferred taxes		(4,112	)		(3,867	)		(5,175	)		(138	)		7,443			(5,849	)			(8,223	)		(276	)
Changes in working capital(6)		708			(787	)		4,893			(13,588	)		(7,674	)		(16,448	)			1,416			(17,252	)
Cash provided by (used in) operating activities		53,052			19,063			63,218			(9,805	)		(3,470	)		122,058				106,104			(9,593	)
Changes in working capital(6)		(708	)		787			(4,893	)		13,588			7,674			16,448				(1,416	)		17,252
Maintenance capital expenditures(7)		(23,000	)		(3,421	)		(4,901	)		(125	)		-			(31,446	)			(45,999	)		(249	)
Free cash flow		29,345			16,429			53,424			3,658			4,204			107,060				58,689			7,410

(1) Proportionately combined Free Cash Flow is equal to the sum of Free Cash Flow attributable to MIC's ownership interest in each of its operating businesses and MIC Corporate.
(2) Proportionately combined Free Cash Flow for Contracted Power and Energy is equal to MIC's controlling ownership interest in its solar power generation and district energy businesses.
(3) Interest expense, net, includes adjustments to derivative instruments and non-cash amortization of deferred financing fees.
(4) IMTT management's calculation of IMTT's EBITDA includes various non-cash items, unlike MIC's other businesses. In order to ensure IMTT's EBITDA excluding non-cash items does in fact exclude non-cash items, and to promote consistency across its reporting segments, MIC has excluded known non-cash items when calculating IMTT's EBITDA excluding non-cash items including primarily the non-cash pension expense of $3.3 million for the six months ended June 30, 2014. The non-cash pension expense of $5.6 million was reported in changes in working capital for the six months ended June 30, 2013.
(5) Casualty losses, net, includes $2.5 million and $1.5 million related to the quarters ended December 31, 2012 and March 31, 2013, respectively, which were recorded in terminal operating costs in those periods. These amounts have been included in the six months ended June 30, 2013.
(6) Pension contribution of $1.4 million for Hawaii Gas for the six months ended June 30, 2013 was reported in changes in working capital.
(7) Maintenance capital expenditures at IMTT includes a reclassification from growth capital expenditures in the quarters ended December 31, 2012 and March 31, 2013 of $1.2 million and $509,000, respectively. These amounts have been included in the six months ended June 30, 2013.
(8) Reclassified to conform with current period presentation.