BETHESDA, Md.–(BUSINESS WIRE)–Enviva Partners, LP (NYSE:EVA) (the “Partnership” or “we”) today
reported financial and operating results for the fourth quarter and
full-year 2016.

Highlights:

• Completed the Sampson Drop-Down acquisition on December 14, 2016
• Generated net revenue of $464.3 million and net income of $17.7
  million for the full-year 2016, after giving effect to the recast for
  the Sampson Drop-Down
• Excluding the results of the Sampson Drop-Down for the period prior
  to the Acquisition Date, generated adjusted EBITDA of $89.6 million
  for the full-year 2016
• Affirming full-year 2017 guidance for net income in a range of
  $31.0 million to $35.0 million and adjusted EBITDA in a range of
  $110.0 million to $114.0 million, excluding the impact of any
  additional drop-downs or third-party acquisitions

“Strong plant performance and reduced costs across our operations
enabled the partnership to deliver solid financial results for the
year,” said John Keppler, Chairman and Chief Executive Officer. “We
completed the Sampson drop-down acquisition earlier than anticipated,
setting the stage for robust growth in 2017.”

Presentation of Recast Financial Results

On December 14, 2016 (the “Acquisition Date”), we consummated the
acquisition of all of the issued and outstanding limited liability
company interests in Enviva Pellets Sampson, LLC (“Sampson”). The
acquisition consisted of a fully operational wood pellet production
plant in Sampson County, North Carolina (the “Sampson Plant”), a
10-year, 420,000 metric tons per year (“MTPY”) off-take contract with
DONG Energy Thermal Power A/S (“DONG Energy”), a 15-year, 95,000 MTPY
off-take contract with our sponsor’s joint venture, and related
third-party shipping contracts (collectively, the “Sampson Drop-Down”).
Because the Sampson Drop-Down was a transfer between entities under
common control, generally accepted accounting principles in the United
States (“GAAP”) require that we recast our financial results to include
the results of the Sampson Drop-Down since the date Sampson was
originally organized. In addition, certain intercompany transactions
between us and Sampson during such periods have been eliminated and the
results are presented as if the assets included in the Sampson Drop-Down
had been the Partnership’s assets since Sampson was initially organized.
As a result, Sampson’s results are now included in our results presented
in accordance with GAAP. The effect of this recast is to present
financial statements as if the Partnership had developed the Sampson
plant when in fact it is our sponsor’s strategy to develop new projects
outside the Partnership. Unless otherwise indicated, the financial
results presented in this release are recast on this basis.

Annual Financial Results

For the full-year 2016, we generated net revenue of $464.3 million, an
increase of 1.5 percent, or $6.9 million, from 2015. Included in net
revenue were product sales of $444.5 million during 2016 and $451.0
million during 2015. Other revenue increased to $19.8 million in 2016
from $6.4 million for 2015, principally due to increased fees earned
related to customer requests to adjust the timing of or cancel
shipments. We generated net income of $17.7 million in 2016 compared to
$19.5 million last year, a decrease of $1.7 million, driven principally
by a $10.0 million non-cash impairment charge associated with the
planned sale of our smallest production plant located in Wiggins,
Mississippi, and higher interest expense.

Excluding the results of the Sampson Drop-Down for the period prior to
the Acquisition Date, adjusted EBITDA for 2016 was $89.6 million, an
increase of 16.0 percent, or $12.4 million, from 2015. The increase in
adjusted EBITDA was driven by increased other revenue and cost
improvements across our operations during 2016, primarily related to
increased plant utilization, lower raw material costs and lower fuel
costs that reduced our to-port logistics costs. Distributable cash flow,
prior to any distributions attributable to incentive distribution rights
paid to the general partner, was $68.8 million.

Fourth Quarter Financial Results

For the fourth quarter of 2016, we generated net revenue of $126.5
million, an increase of 8.3 percent, or $9.7 million, from the
corresponding quarter of 2015. Included in net revenue were product
sales of $121.2 million, an increase of $6.1 million from the
corresponding quarter of last year due to an increased number of
shipments under CIF contracts, which had the effect of increasing
revenue and cost of sales, as well as favorable contract pricing mix. We
had a net loss of $8.1 million compared to net income of $7.6 million
for the fourth quarter of 2015, a decrease of $15.7 million, driven by
the non-cash impairment charge mentioned above and an increase in
interest expense.

Excluding the results of the Sampson Drop-Down for the period prior to
the Acquisition Date, adjusted EBITDA for the fourth quarter of 2016 was
$22.2 million, an increase of 3.1 percent, or $0.7 million, from the
corresponding period in 2015. The increase in adjusted EBITDA was driven
by increased product sales and lower raw material costs. Distributable
cash flow, prior to any distributions attributable to incentive
distribution rights paid to the general partner, was $12.9 million.

Distribution

As announced February 1, 2017, the board of directors of our general
partner declared a distribution of $0.5350 per common and subordinated
unit for the fourth quarter of 2016. This distribution is 16.3 percent
higher than the distribution for the fourth quarter of 2015. The
quarterly distribution will be paid on Tuesday, February 28, 2017, to
unitholders of record as of the close of business on Wednesday,
February 15, 2017.

Including the fourth quarter distribution, the Partnership will have
distributed $2.10 per common and subordinated unit for full-year 2016.
The Partnership’s distributable cash flow, excluding the results of the
Sampson Drop-Down for the period prior to the Acquisition Date and net
of amounts attributable to incentive distribution rights, was $67.8
million for 2016, resulting in a distribution coverage ratio of 1.28
times.

Outlook and Guidance

Consistent with the guidance provided on November 3, 2016, the
Partnership expects full-year 2017 net income to be in the range of
$31.0 million to $35.0 million and adjusted EBITDA to be in the range of
$110.0 million to $114.0 million. The Partnership expects to incur
maintenance capital expenditures of $5.0 million and interest expense
net of amortization of debt issuance costs and original issue discount
of $29.0 million in 2017. As a result, the Partnership expects full-year
distributable cash flow to be in the range of $76.0 million to $80.0
million, prior to any distributions attributable to incentive
distribution rights paid to the general partner. For full-year 2017, we
expect to distribute at least $2.35 per common and subordinated unit.
The guidance amounts provided above do not include the impact of any
additional acquisitions from the Partnership’s sponsor or third parties.
Although deliveries to our customers are generally ratable over the
year, the Partnership’s quarterly income and cash flow are subject to
modest seasonality in the first quarter and to the mix of customer
shipments made, which may vary from period to period. As such, the board
of directors of the Partnership’s general partner evaluates the
Partnership’s distribution coverage ratio on an annual basis when
determining the distribution for a quarter.

Market and Contracting Update

Our sales strategy is to fully contract the production capacity of the
Partnership. Our current capacity is matched with a portfolio of
off-take contracts that has a weighted-average remaining term of 9.8
years from February 1, 2017.

Independent industry experts Hawkins Wright project that worldwide
demand for industrial wood pellets will increase to approximately 27
million tons in 2020, representing an annual growth rate of nearly 20
percent, driven predominantly by biomass consumption in Europe and Asia.
The following are key recent developments:

• DONG Energy, the largest power producer in Denmark, announced in
  February 2017 that it will completely eliminate the use of coal in its
  generation of power and heat by 2023, and will replace the fuel with
  biomass. DONG Energy already has two facilities burning wood pellets,
  which are expected to consume approximately 1.8 million MTPY of wood
  pellets at full capacity.
• In December, Drax Power Limited (“Drax”) received EU state-aid
  approval of the contract for difference (CfD) through 2027 for its
  third 660 megawatt (“MW”) biomass unit, which is anticipated to
  require more than 2 million MTPY of wood pellets. Drax has stated that
  it could convert the remaining three coal-burning units to biomass in
  the next two to three years under the right conditions.
• In the Netherlands, biomass projects were awarded the majority of the
  5.0 billion euros in funding available through the second and final
  round of applications for the 2016 renewable incentive program,
  including 2.1 billion euros awarded to coal plants planning to co-fire
  biomass. Both rounds in 2016 were heavily oversubscribed, and RWE,
  Engie, and Uniper received awards. The Minister of Economic Affairs
  has announced that the program budget will be increased from 9.0
  billion euros in 2016 to 12.0 billion euros in 2017.
• In November, Japan ratified the Paris climate agreement, demonstrating
  the government’s commitment to reducing carbon emissions. As part of
  their plan for significant emissions reductions by 2030, Japan has set
  a target of 6.0 – 7.5 gigawatts (“GWs”) of biomass-fired capacity, of
  which nearly 3.2 GWs have been approved through Japan’s feed-in tariff
  (FiT) program with many other projects that are either awaiting
  approval or expected to apply prior to the September deadline for the
  2017 award applications. Several power producers have announced
  biomass projects, including Japan’s largest electricity wholesaler,
  Electric Power Development Company (J-Power), which stated recently it
  expects to co-fire biomass at all seven of its coal-fired plants.
• Several recently announced biomass-fueled projects in South Korea are
  expected to be operational by 2020, increasing the expected South
  Korean demand for wood pellets up to 6 million MTPY. As this demand is
  well in excess of expected domestic supply, a significant amount of
  wood pellets are expected to be imported under long-term contracts,
  representing a shift from the short-term tender mechanism currently
  used to purchase biomass in South Korea.
• In January, China’s National Energy Administration announced that the
  country will spend at least $360.0 billion on renewable energy through
  2030. In addition, published reports indicate that China is expected
  to increase biomass-fired generation capacity from 10.3 GWs in 2015 to
  15.0 GWs by 2020.

Sponsor Activity

Construction of our sponsor’s deep-water marine terminal in Wilmington,
North Carolina (the “Wilmington terminal”) is complete. The first
shipment was loaded in December 2016, the facility receives regular
deliveries via truck and rail, and routinely loads vessels consistent
with our sponsor’s expectations. The Partnership expects to have the
opportunity to acquire the Wilmington terminal in 2017.

Our sponsor’s joint venture is currently completing the detailed design
for a build-and-copy replica of the Sampson plant at a permitted site in
Hamlet, North Carolina, to supply MGT Power’s Teesside Renewable Energy
Plant. In order to supply anticipated incremental volume growth in
Europe and the emerging Asian market, our sponsor is also evaluating
additional production capacity investments at its sites in Lucedale,
Mississippi and Abbeville, Alabama, as well as other sites positioned to
take advantage of the existing terminal capacity at our Port of
Chesapeake and the Port of Wilmington. In addition, our sponsor
continues to evaluate its option to build and operate a marine export
terminal at the Port of Pascagoula, Mississippi, which could support
pellet production from the potential plant in Lucedale, Mississippi and
other potential facilities in the region.

Conference Call

We will host a conference call with executive management related to our
fourth quarter and full-year 2016 results and to discuss our outlook and
guidance, and a more detailed market update, at 10:00 a.m. (Eastern
Time) on Thursday, February 23, 2017. Information on how interested
parties may listen to the conference call is available in the Investor
Relations page of our website (www.envivabiomass.com).
A replay of the conference call will be available on our website after
the live call concludes.

About Enviva Partners, LP

Enviva Partners, LP (NYSE:EVA) is a publicly traded master limited
partnership that aggregates a natural resource, wood fiber, and
processes it into a transportable form, wood pellets. The Partnership
sells a significant majority of its wood pellets through long-term,
take-or-pay agreements with creditworthy customers in the United Kingdom
and Europe. The Partnership owns and operates six plants with a combined
production capacity of nearly three million metric tons of wood pellets
per year in Virginia, North Carolina, Mississippi, and Florida. In
addition, the Partnership owns a deep-water marine terminal at the Port
of Chesapeake, Virginia, which is used to export wood pellets. Enviva
Partners also exports pellets through the ports of Wilmington, North
Carolina; Mobile, Alabama; and Panama City, Florida.

To learn more about Enviva Partners, LP, please visit our website at www.envivabiomass.com.

Non-GAAP Financial Measures

We provide results in this release that (i) do not give effect to the
recast of financial results and assume the Sampson Drop-Down had not
occurred or (ii) include financial results of assets excluding the
period prior to the Acquisition Date. These illustrative presentations
are not presented in accordance with GAAP and should not be considered
alternatives to the presentation of the recast financial results of the
Partnership. Management views these presentations as important to
reflect the Partnership’s actual performance during 2016, including as
measured against our published guidance for 2016, which did not include
the impact of acquisitions.

We use adjusted gross margin per metric ton, adjusted EBITDA and
distributable cash flow to measure our financial performance.

Adjusted Gross Margin per Metric Ton

We define adjusted gross margin as gross margin excluding depreciation
and amortization included in cost of goods sold. We believe adjusted
gross margin per metric ton is a meaningful measure because it compares
our revenue-generating activities to our operating costs for a view of
profitability and performance on a per metric ton basis. Adjusted gross
margin per metric ton will be affected primarily by our ability to meet
targeted production volumes and to control direct and indirect costs
associated with procurement and delivery of wood fiber to our production
plants and the production and distribution of wood pellets.

Adjusted EBITDA

We define adjusted EBITDA as net income or loss excluding depreciation
and amortization, interest expense, income tax expense, early retirement
of debt obligations, non-cash unit compensation expense, asset
impairments and disposals and certain items of income or loss that we
characterize as unrepresentative of our ongoing operations. Adjusted
EBITDA is a supplemental measure used by our management and other users
of our financial statements, such as investors, commercial banks and
research analysts, to assess the financial performance of our assets
without regard to financing methods or capital structure.

Distributable Cash Flow

We define distributable cash flow as adjusted EBITDA less maintenance
capital expenditures and interest expense net of amortization of debt
issuance costs and original issue discount. We use distributable cash
flow as a performance metric to compare the cash-generating performance
of the Partnership from period to period and to compare the
cash-generating performance for specific periods to the cash
distributions (if any) that are expected to be paid to our unitholders.
We do not rely on distributable cash flow as a liquidity measure.

Adjusted gross margin per metric ton, adjusted EBITDA, and distributable
cash flow are not financial measures presented in accordance with GAAP.
We believe that the presentation of these non-GAAP financial measures
provides useful information to investors in assessing our financial
condition and results of operations. Our non-GAAP financial measures
should not be considered as alternatives to the most directly comparable
GAAP financial measures. Each of these non-GAAP financial measures has
important limitations as an analytical tool because they exclude some,
but not all, items that affect the most directly comparable GAAP
financial measures. You should not consider adjusted gross margin per
metric ton, adjusted EBITDA, or distributable cash flow in isolation or
as substitutes for analysis of our results as reported under GAAP. Our
definitions of these non-GAAP financial measures may not be comparable
to similarly titled measures of other companies, thereby diminishing
their utility.

The following tables present a reconciliation of adjusted gross margin
per metric ton, adjusted EBITDA and distributable cash flow to the most
directly comparable GAAP financial measures, as applicable, for each of
the periods indicated.

			Three Months Ended December 31,							Year Ended December 31,
			2016				2015 (Recast)			2016				2015 (Recast)
			(in thousands, except per metric ton)
Reconciliation of gross margin to adjusted gross margin per metric ton:
Metric tons sold					632			629				2,346			2,374
Gross margin			$		20,066		$	18,124		$		79,373		$	61,621
Depreciation and amortization					7,265			6,640				27,694			30,692
Adjusted gross margin			$		27,331		$	24,764		$		107,067		$	92,313
Adjusted gross margin per metric ton			$		43.25		$	39.37		$		45.64		$	38.89

			Three Months Ended December 31,							Year Ended December 31,
			2016				2015 (Recast)			2016				2015 (Recast)
			(in thousands)
Reconciliation of distributable cash flow and adjusted EBITDA to net (loss) income:
Net (loss) income			$		(8,058)		$	7,601				17,723		$	19,460
Add:
Depreciation and amortization					7,270			6,652				27,722			30,738
Interest expense					6,124			2,990				16,220			11,710
Early retirement of debt obligation					4,438			—				4,438			4,699
Purchase accounting adjustment to inventory					—			—				—			697
Non-cash unit compensation expense					1,569			341				4,230			704
Income tax (benefit) expense					—			(34)				—			2,623
Asset impairments and disposals					10,698			2,181				12,377			2,081
Acquisition transaction expenses					719			462				827			893
Adjusted EBITDA					22,760			20,193				83,537			73,605
Less:
Interest expense net of amortization of debt issuance costs and original issue discount					6,867			2,614				15,625			10,104
Maintenance capital expenditures					2,429			893				5,187			4,359
Distributable cash flow attributable to Enviva Partners, LP					13,464			16,686				62,725			59,142
Less: Distributable cash flow attributable to incentive distribution rights					361			—				1,077			—
Distributable cash flow attributable to Enviva Partners, LP limited partners			$		13,103		$	16,686		$		61,648		$	59,142

The following tables present, in each case for the year ended
December 31, 2016:

• our recast results prepared in accordance with GAAP, including
  Sampson’s results for periods we did not own Sampson and elimination
  of certain intercompany transactions;
• our results excluding the results of the Sampson Drop-Down for the
  period prior to the Acquisition Date; and
• what our results would have been assuming the Sampson Drop-Down had
  not occurred.

			Year Ended December 31, 2016
			As Reported						Excluding Sampson Drop-Down Prior to the Acquisition Date				Assuming Sampson Drop-Down had not Occurred
			(in thousands)
			(unaudited)
Product sales			$			444,489			$	441,082			$	431,611
Other revenue						19,787				18,869				19,007
Net revenue						464,276				459,951				450,618
Cost of goods sold, excluding depreciation and amortization						357,209				354,990				347,664
Depreciation and amortization						27,694				27,694				26,936
Total cost of goods sold						384,903				382,684				374,600
Gross margin						79,373				77,267				76,018
General and administrative expenses						29,054				20,465				20,439
Impairment on assets held for sale						9,991				9,991				9,991
Loss on disposal of assets						2,386				2,351				2,351
Income from operations						37,942				44,460				43,237
Other income (expense):
Interest expense						(15,642)				(15,631)				(17,279)
Related party interest expense						(578)				(578)				(578)
Early retirement of debt obligation						(4,438)				(4,438)				—
Other income						439				438				438
Total other expense, net						(20,219)				(20,209)				(17,419)
Net income						17,723				24,251				25,818
Less net loss attributable to noncontrolling partners’ interests						3,654				358				358
Net income attributable to Enviva Partners, LP			$			21,377			$	24,609			$	26,176

			Year Ended December 31, 2016
			As Reported				Excluding Sampson Drop-Down Prior to the Acquisition Date				Assuming Sampson Drop-Down had not Occurred
			(in thousands)
Reconciliation of distributable cash flow and adjusted EBITDA to net income :
Net income			$	17,723			$	24,251			$	25,818
Add:
Depreciation and amortization				27,722				27,722				26,964
Interest expense				16,220				16,209				17,857
Early retirement of debt obligation				4,438				4,438				—
Non-cash unit compensation expense				4,230				4,230				4,230
Asset impairments and disposals				12,377				12,342				12,342
Acquisition transaction expenses				827				450				435
Adjusted EBITDA			$	83,537			$	89,642				87,646
Less:
Interest expense net of amortization of debt issuance costs and original issue discount				15,625				15,614				15,964
Maintenance capital expenditures				5,187				5,187				5,187
Distributable cash flow attributable to Enviva Partners, LP				62,725				68,841				66,495
Less: Distributable cash flow attributable to incentive distribution rights				1,077				1,077				1,077
Distributable cash flow attributable to Enviva Partners, LP				61,648				67,764				65,418

The following tables present, in each case for the three months ended
December 31, 2016:

• our recast results prepared in accordance with GAAP, including
  Sampson’s results for periods we did not own Sampson and elimination
  of certain intercompany transactions;
• our results excluding the results of the Sampson Drop-Down for the
  period prior to the Acquisition Date; and
• what our results would have been assuming the Sampson Drop-Down had
  not occurred.

			Three Months Ended December 31, 2016
			As Reported					Excluding Sampson Drop-Down Prior to the Acquisition Date				Assuming Sampson Drop-Down had not Occurred
			(in thousands)
			(unaudited)
Product sales			$		121,220			$	118,833			$	109,362
Other revenue					5,301				4,383				4,521
Net revenue					126,521				123,216				113,883
Cost of goods sold, excluding depreciation and amortization					99,190				96,971				89,645
Depreciation and amortization					7,265				7,265				6,507
Total cost of goods sold					106,455				104,236				96,152
Gross margin					20,066				18,980				17,731
General and administrative expenses					7,029				6,156				6,130
Impairment on assets held for sale					9,991				9,991				9,991
Loss on disposal of assets					707				707				707
Income from operations					2,339				2,126				903
Other income (expense):
Interest expense					(6,107)				(6,097)				(7,745)
Related party interest expense					(17)				(17)				(17)
Early retirement of debt obligation					(4,438)				(4,438)				—
Other income					165				165				165
Total other expense, net					(10,397)				(10,387)				(7,597)
Net loss					(8,058)				(8,261)				(6,694)
Less net loss attributable to noncontrolling partners’ interests					187				289				289
Net loss attributable to Enviva Partners, LP			$		(7,871)			$	(7,972)			$	(6,405)

			Three Months Ended December 31, 2016
			As Reported					Excluding Sampson Drop-Down Prior to the Acquisition Date				Assuming Sampson Drop-Down had not Occurred
			(in thousands)
Reconciliation of distributable cash flow and adjusted EBITDA to net loss:
Net loss			$		(8,058)			$	(8,261)			$	(6,694)
Add:
Depreciation and amortization					7,270				7,270				6,512
Interest expense					6,124				6,114				7,762
Early retirement of debt obligation					4,438				4,438				—
Non-cash unit compensation expense					1,569				1,569				1,569
Asset impairments and disposals					10,698				10,698				10,698
Acquisition transaction expenses					719				388				373
Adjusted EBITDA			$		22,760			$	22,216			$	20,220
Less:
Interest expense net of amortization of debt issuance costs and original issue discount					6,867				6,857				7,207
Maintenance capital expenditures					2,429				2,429				2,429
Distributable cash flow attributable to Enviva Partners, LP					13,464				12,930				10,584
Less: Distributable cash flow attributable to incentive distribution rights					361				361				361
Distributable cash flow attributable to Enviva Partners, LP			$		13,103			$	12,569			$	10,223

The following table presents, in each case for the three months ended
and the years ended December 31, 2016 and 2015, a reconciliation of
adjusted EBITDA and distributable cash flow, each excluding the results
of the Sampson Drop-Down for the period prior to the Acquisition Date,
to the most directly comparable GAAP financial measures, as applicable,
for each of the periods indicated.

			Three Months Ended December 31,							Year Ended December 31,
			2016				2015 (Recast)			2016				2015 (Recast)
			(in thousands)
Reconciliation of distributable cash flow and adjusted EBITDA to net (loss) income:
Net (loss) income			$		(8,058)		$	7,601				17,723		$	19,460
Add:
Depreciation and amortization					7,270			6,652				27,722			30,738
Interest expense					6,124			2,990				16,220			11,710
Early retirement of debt obligation					4,438			—				4,438			4,699
Purchase accounting adjustment to inventory					—			—				—			697
Non-cash unit compensation expense					1,569			341				4,230			704
Income tax (benefit) expense					—			(34)				—			2,623
Asset impairments and disposals					10,698			2,181				12,377			2,081
Acquisition transaction expenses					719			462				827			893
Effect of Sampson contribution recast					(544)			1,362				6,105			3,667
Adjusted EBITDA					22,216			21,555				89,642			77,272
Less:
Interest expense net of amortization of debt issuance costs and original issue discount					6,857			2,614				15,614			10,099
Maintenance capital expenditures					2,429			893				5,187			4,359
Distributable cash flow attributable to Enviva Partners, LP					12,930			18,048				68,841			62,814
Less: Distributable cash flow attributable to incentive distribution rights					361			—				1,077			—
Distributable cash flow attributable to Enviva Partners, LP limited partners			$		12,569		$	18,048		$		67,764		$	62,814

The following table provides a reconciliation of the estimated range of
adjusted EBITDA and distributable cash flow to the estimated range of
net income, in each case for the twelve months ending December 31, 2017
(in millions):

			Twelve Months Ending December 31, 2017
Estimated net income			$	31.0 – 35.0
Add:
Depreciation and amortization				34.5
Interest expense				31.3
Non-cash unit compensation expense				6.6
Asset impairments and disposals				4.0
Early retirement of debt obligations				2.6
Estimated adjusted EBITDA			$	110.0 – 114.0
Less:
Interest expense net of amortization of debt issuance costs and original issue discount				29.0
Maintenance capital expenditures				5.0
Estimated distributable cash flow			$	76.0 – 80.0

Cautionary Note Concerning Forward-Looking Statements

Certain statements and information in this press release, including
those concerning our future results of operations, acquisition
opportunities, and distributions, may constitute “forward-looking
statements.” The words “believe,” “expect,” “anticipate,” “plan,”
“intend,” “foresee,” “should,” “would,” “could,” or other similar
expressions are intended to identify forward-looking statements, which
are generally not historical in nature. These forward-looking statements
are based on the Partnership’s current expectations and beliefs
concerning future developments and their potential effect on the
Partnership. Although management believes that these forward-looking
statements are reasonable when made, there can be no assurance that
future developments affecting the Partnership will be those that it
anticipates. The forward-looking statements involve significant risks
and uncertainties (some of which are beyond the Partnership’s control)
and assumptions that could cause actual results to differ materially
from the Partnership’s historical experience and its present
expectations or projections. Important factors that could cause actual
results to differ materially from forward-looking statements include,
but are not limited to: (i) the volume of products that we are able to
sell; (ii) the price at which we are able to sell our products; (iii)
failure of the Partnership’s customers, vendors, and shipping partners
to pay or perform their contractual obligations to the Partnership; (iv)
the creditworthiness of our financial counterparties; (v) the amount of
low-cost wood fiber that we are able to procure and process, which could
be adversely affected by, among other things, operating or financial
difficulties suffered by our suppliers; (vi) the amount of products that
we are able to produce, which could be adversely affected by, among
other things, operating difficulties; (vii) changes in the price and
availability of natural gas, coal, or other sources of energy; (viii)
changes in prevailing economic conditions; (ix) the ability of the
Partnership to complete acquisitions, including acquisitions from our
sponsor, and realize the anticipated benefits of such acquisitions; (x)
unanticipated ground, grade, or water conditions; (xi) inclement or
hazardous weather conditions, including extreme precipitation,
temperatures, and flooding; (xii) environmental hazards; (xiii) fires,
explosions, or other accidents; (xiv) changes in domestic and foreign
laws and regulations (or the interpretation thereof) related to
renewable or low-carbon energy, the forestry products industry, or power
generators; (xv) changes in the regulatory treatment of biomass in core
and emerging markets for utility-scale generation; (xvi) the inability
to acquire or maintain necessary permits or rights for our production,
transportation, and terminaling operations; (xvii) the inability to
obtain necessary production equipment or replacement parts; (xviii)
operating or technical difficulties or failures at our plants or ports;
(xix) labor disputes; (xx) the inability of our customers to take
delivery of our products; (xxi) changes in the price and availability of
transportation; (xxii) changes in foreign currency exchange rates;
(xxiii) changes in interest rates; (xxiv) failure of our hedging
arrangements to effectively reduce our exposure to interest and foreign
currency exchange rate risk; (xxv) risks related to our indebtedness;
(xxvi) customer rejection due to our failure to maintain effective
quality control systems at our production plants and deep-water marine
terminals; (xxvii) changes in the quality specifications for our
products that are required by our customers; (xxviii) the effects of the
approval of the United Kingdom of the exit of the United Kingdom
(“Brexit”) from the European Union, and the implementation of Brexit, in
each case on our and our customers’ businesses; and (xxix) the ability
of the Partnership to borrow funds and access capital markets.

For additional information regarding known material factors that could
cause the Partnership’s actual results to differ from projected results,
please read its filings with the Securities and Exchange Commission,
including the Annual Report on Form 10-K and the Quarterly Reports on
Form 10-Q most recently filed with the SEC. Readers are cautioned not to
place undue reliance on forward-looking statements, which speak only as
of the date thereof. The Partnership undertakes no obligation to
publicly update or revise any forward-looking statements after the date
they are made, whether as a result of new information, future events, or
otherwise.

Financial Statements

ENVIVA PARTNERS, LP AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands, except number of units)
			December 31, 2016			December 31, 2015 (Recast)
Assets
Current assets:
Cash and cash equivalents			$	466		$	2,128
Accounts receivable, net of allowance for doubtful accounts of $24 in 2016 and $85 in 2015				77,868			38,684
Related party receivables				7,634			176
Inventories				29,764			24,245
Assets held for sale				3,044			—
Prepaid expenses and other current assets				1,939			2,124
Total current assets				120,715			67,357
Property, plant and equipment, net of accumulated depreciation of $80.8 million in 2016 and $64.7 million in 2015				516,418			494,465
Intangible assets, net of accumulated amortization of $9.1 million in 2016 and $7.0 million in 2015				1,371			3,399
Goodwill				85,615			85,615
Other long-term assets				2,049			7,063
Total assets			$	726,168		$	657,899
Liabilities and Partners’ Capital
Current liabilities:
Accounts payable			$	9,869		$	14,277
Related party payables				11,118			11,609
Accrued liabilities				37,914			26,509
Related party accrued liabilities				382			—
Deferred revenue				—			485
Current portion of interest payable				4,414			—
Current portion of long-term debt and capital lease obligations				4,109			6,523
Related party current portion of long-term debt				—			150
Other current liabilities				518			274
Total current liabilities				68,324			59,827
Long-term debt and capital lease obligations				346,686			186,294
Related party long-term debt				—			14,664
Long-term interest payable				770			751
Other long-term liabilities				871			586
Total liabilities				416,651			262,122
Commitments and contingencies
Partners’ capital:
Limited partners:
Common unitholders—public (12,980,623 and 11,502,934 units issued and outstanding at December 31, 2016 and 2015, respectively)				239,902			210,488
Common unitholder—sponsor (1,347,161 units issued and outstanding at December 31, 2016 and 2015)				18,197			19,619
Subordinated unitholder—sponsor (11,905,138 units issued and outstanding at December 31, 2016 and 2015)				120,872			133,427
General partner (no outstanding units)				(67,393)			31,245
Accumulated other comprehensive income				595			—
Total Enviva Partners, LP partners’ capital				312,173			394,779
Noncontrolling partners’ interests				(2,656)			998
Total partners’ capital				309,517			395,777
Total liabilities and partners’ capital			$	726,168		$	657,899

ENVIVA PARTNERS, LP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per unit amounts)
			Three Months Ended December 31,									Year Ended December 31,
			2016					2015 (Recast)				2016					2015 (Recast)
Product sales			$		121,220			$	115,123			$		444,489			$	450,980
Other revenue					5,301				1,690					19,787				6,394
Net revenue					126,521				116,813					464,276				457,374
Cost of goods sold, excluding depreciation and amortization					99,190				92,049					357,209				365,061
Depreciation and amortization					7,265				6,640					27,694				30,692
Total cost of goods sold					106,455				98,689					384,903				395,753
Gross margin					20,066				18,124					79,373				61,621
General and administrative expenses					7,029				6,274					29,054				22,027
Impairment of assets held for sale					9,991				—					9,991				—
Loss on disposal of assets					707				2,181					2,386				2,081
Income from operations					2,339				9,669					37,942				37,513
Other income (expense):
Interest expense					(6,107	)			(2,935	)				(15,642	)			(10,556	)
Related party interest expense					(17	)			(57	)				(578	)			(1,154	)
Early retirement of debt obligation					(4,438	)			—					(4,438	)			(4,699	)
Other income					165				890					439				979
Total other expense, net					(10,397	)			(2,102	)				(20,219	)			(15,430	)
(Loss) income before income tax expense					(8,058	)			7,567					17,723				22,083
Income tax (benefit) expense					—				(34	)				—				2,623
Net (loss) income					(8,058	)			7,601					17,723				19,460
Less net loss attributable to noncontrolling partners’ interests					187				845					3,654				1,899
Net (loss) income attributable to Enviva Partners, LP			$		(7,871	)		$	8,446			$		21,377			$	21,359
Less: Predecessor loss to May 4, 2015 (prior to IPO)			$		—			$	—			$		—			$	(2,132	)
Less: Pre-acquisition income from April 10, 2015 to September 30, 2015 from operations of Enviva Pellets Southampton, LLC Drop-Down allocated to General Partner					—				2,030					—				6,264
Less: Pre-acquisition income (loss) from inception to December 13, 2016 from operations of Enviva Pellets Sampson, LLC Drop-Down allocated to General Partner					101				(529	)				(3,231	)			(1,815	)
Enviva Partners, LP partners’ interest in net (loss) income			$		(7,972	)		$	6,945			$		24,608			$	19,042
Net (loss) income per common unit:
Basic			$		(0.34	)		$	0.29			$		0.95			$	0.80
Diluted			$		(0.34	)		$	0.29			$		0.91			$	0.79
Net (loss) income per subordinated unit:
Basic			$		(0.32	)		$	0.29			$		0.93			$	0.80
Diluted			$		(0.32	)		$	0.29			$		0.93			$	0.79
Weighted average number of limited partner units outstanding:
Common — basic					13,002				12,122					13,002				11,988
Common — diluted					13,002				12,419					13,559				12,258
Subordinated — basic and diluted					11,905				11,905					11,905				11,905

ENVIVA PARTNERS, LP AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands)
			Year Ended December 31, 2016			Year Ended December 31, 2015 (Recast)
Cash flows from operating activities:
Net income			$	17,723		$	19,460
Adjustments to reconcile net income to net cash provided by operating activities:				—
Depreciation and amortization				27,722			30,738
Amortization of debt issuance costs and original issue discount				1,893			1,606
Inventory impairment				890			—
Impairment of assets held for sale				9,991			—
General and administrative expense incurred by sponsor				—			475
General and administrative expense incurred by Hancock JV prior to Enviva Pellets Sampson, LLC Drop-Down				2,343			2,364
Allocation of income tax expense from Enviva Cottondale Acquisition I, LLC				—			2,663
Early retirement of debt obligation				4,438			4,699
Loss on property, plant and equipment				2,386			2,081
Unit-based compensation expense				4,230			704
Change in fair value of interest rate swap derivatives				—			23
Change in operating assets and liabilities:
Accounts receivable, net				(39,218)			(3,518)
Related party receivables				600			(176)
Prepaid expenses and other assets				713			57
Inventories				(8,240)			(22)
Other long-term assets				6,697			(6,051)
Derivatives				(1,284)			—
Accounts payable, accrued liabilities and other current liabilities				18,834			6,678
Related party payables				3,661			4,102
Accrued interest				4,433			105
Deferred revenue and deposits				(486)			425
Other long-term liabilities				67			—
Net cash provided by operating activities				57,393			66,413
Cash flows from investing activities:
Purchases of property, plant and equipment				(70,910)			(76,772)
Payment of acquisition related costs				—			(3,573)
Proceeds from the sale of property, plant and equipment				1,763			299
Net cash used in investing activities				(69,147)			(80,046)
Cash flows from financing activities:
Principal payments on debt and capital lease obligations				(204,208)			(199,638)
Principal payments on related party debt				(3,391)			—
Cash paid related to debt issuance costs				(6,390)			(6,287)
Termination payment for interest rate swap derivatives				—			(146)
Cash restricted for debt service				—			11,640
IPO proceeds, net				—			215,050
Distributions to sponsor				(5,002)			(297,185)
Proceeds from common unit issuance under At-the-Market Offering Program, net				9,300			—
Distributions to unitholders, distribution equivalent rights and incentive distribution rights holder				(51,376)			(16,883)
Proceeds from contributions from sponsor				—			12,387
Distribution to sponsor related to Enviva Pellets Sampson, LLC Drop-Down				(139,604)			—
Proceeds from contributions from Hancock JV prior to Enviva Pellets Sampson, LLC Drop-Down				61,972			68,059
Payment of deferred offering costs				(709)			(1,964)
Proceeds from debt issuance				349,500			230,140
Net cash provided by financing activities				10,092			15,173
Net (decrease) increase in cash and cash equivalents				(1,662)			1,540
Cash and cash equivalents, beginning of period				2,128			588
Cash and cash equivalents, end of period			$	466		$	2,128

ENVIVA PARTNERS, LP AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands)
			Year Ended December 31, 2016			Year Ended December 31, 2015 (Recast)
Non-cash investing and financing activities:
The Partnership acquired property, plant and equipment in non-cash transactions as follows:
Property, plant and equipment acquired included in accounts payable and accrued liabilities			$	8,630		$	19,197
Property, plant and equipment acquired under notes payable and capital lease obligations				1,460			39
Property, plant and equipment transferred from prepaid expenses and inventory				926			319
Contribution of Enviva Pellets Cottondale, LLC non-cash assets				—			122,529
Transfer of Enviva Pellets Wiggins, LLC assets to assets held for sale				13,035			—
Application of deferred IPO costs to partners’ capital				—			5,913
Related party long-term debt transferred to third-party long-term debt				14,757			—
Third-party long-term debt transferred to related party long-term debt				3,316			—
Distributions included in liabilities				955			58
Distribution due to sponsor				—			5,002
Debt issuance costs included in accrued liabilities				139			36
Distribution of Enviva Pellets Cottondale, LLC assets to sponsor				—			319
Non-cash adjustments to financed insurance and prepaid expenses				—			105
Application of sales tax accrual to fixed assets				—			73
Contribution to tax accounts of sponsor				—			35
Depreciation capitalized to inventories				344			211
Due from Hancock JV for Enviva Pellets Sampson, LLC Drop-Down				1,652			—
Non-cash capital contributions from sponsor				—			339
Non-cash capital contributions from Hancock JV prior to Enviva Pellets Sampson Drop-Down				8,230			1,277
Supplemental information:
Interest paid			$	11,189		$	9,933