Attached files
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| 8-K - FORM 8-K - Western Midstream Operating, LP | wesq32013form8k.htm |
EXHIBIT 99.1
WESTERN GAS ANNOUNCES
THIRD-QUARTER 2013 RESULTS
RAISES MIDPOINT OF 2013 ADJUSTED EBITDA(1) GUIDANCE RANGE
HOUSTON, November 6, 2013 – Western Gas Partners, LP (NYSE: WES) (“WES”) and Western Gas Equity Partners, LP (NYSE: WGP) (“WGP”) today announced third-quarter 2013 financial and operating results.
WESTERN GAS PARTNERS, LP
Net income available to limited partners for the third quarter of 2013 totaled $59.7 million, or $0.53 per common unit (diluted). For the third quarter of 2013, Adjusted EBITDA(1) was $125.2 million and Distributable cash flow(1) was $105.9 million, resulting in a Coverage ratio(1) of 1.26 times for the period.
Total throughput attributable to WES for the third quarter of 2013 averaged 3.3 Bcf/d, which was 5% above the prior quarter and 16% above the third quarter of 2012(2). Excluding acquisitions, capital expenditures attributable to WES on a cash basis totaled $127.6 million during the third quarter of 2013. Of this amount, maintenance capital expenditures were $7.4 million, or 6% of Adjusted EBITDA(1). Capital expenditures attributable to WES on an accrual basis and excluding acquisitions totaled $154.3 million during the third quarter of 2013.
(1) Please see the tables at the end of this release for a reconciliation of non-GAAP to GAAP measures and calculation of the Coverage ratio.
(2) These results include the net throughput attributable to the 33.75% interest in certain third-party operated Marcellus gathering assets acquired from Anadarko (the “Non-Operated Marcellus Interest”) for all periods of comparison, throughput attributable to the additional Chipeta interest beginning in August 2012, and throughput attributable to the 33.75% interest in certain Anadarko-operated Marcellus gathering assets acquired from a third party (the “Anadarko-Operated Marcellus Interest”) beginning in March 2013.
“We are now realizing the returns on the significant capital program we began last year, which includes the organic growth projects that have contributed to our outstanding quarterly results,” said President and Chief Executive Officer, Don Sinclair. “The strong performance across our portfolio has enabled us to raise the midpoint of our Adjusted EBITDA guidance range for the full year.”
WES previously declared a quarterly distribution of $0.58 per unit for the third quarter of 2013, representing a 4% increase over the prior quarter and a 16% increase over the third-quarter 2012 distribution of $0.50 per unit. The distribution will be paid on November 12, 2013, to unitholders of record at the close of business on October 31, 2013. The third-quarter 2013 Coverage ratio(1) of 1.26 times is based on the quarterly distribution of $0.58 per unit.
REVISED 2013 WES OUTLOOK
Based on the current forecast, WES’s Adjusted EBITDA(1) for 2013 is now expected to be between $440 million and $450 million. Total cash basis capital expenditures, excluding acquisitions, are now expected to range from $670 million to $740 million, with maintenance capital expenditures expected to be between 7% and 10% of Adjusted EBITDA(1).
WESTERN GAS EQUITY PARTNERS, LP
As of September 30, 2013, WGP indirectly owned the 2% general partner interest and 100% of the incentive distribution rights in WES and 49,296,205 WES common units. Net income available to limited partners for the third quarter of 2013 totaled $44.3 million, or $0.20 per common unit (diluted).
WGP previously declared a quarterly distribution of $0.21375 per unit for the third quarter of 2013, representing an 8% increase over the distribution from the prior quarter. The distribution will be paid on November 21, 2013, to unitholders of record at the close of business on October 31, 2013. WGP will receive distributions from WES of $47.4 million attributable to the third quarter and will pay out $46.8 million in distributions for the same period.
(1) Please see the tables at the end of this release for a reconciliation of non-GAAP to GAAP measures and calculation of the Coverage ratio.
2
CONFERENCE CALL TOMORROW AT 11 A.M. CST
WES and WGP will host a joint conference call on Thursday, November 7, 2013, at 11:00 a.m. Central Standard Time (12:00 p.m. Eastern Standard Time) to discuss third-quarter 2013 results. To participate via telephone, please dial 877.621.4819 and enter participant code 75029606. Please call in 10 minutes prior to the scheduled start time. To access the live audio webcast of the conference call and slide presentation, please visit www.westerngas.com. A replay of the call will also be available on the website for approximately two weeks following the conference call.
Western Gas Partners, LP (“WES”) is a growth-oriented Delaware master limited partnership formed by Anadarko Petroleum Corporation to own, operate, acquire and develop midstream energy assets. With midstream assets in East, West and South Texas, the Rocky Mountains, north-central Pennsylvania and the Mid-Continent, WES is engaged in the business of gathering, processing, compressing, treating and transporting natural gas, condensate, natural gas liquids and crude oil for Anadarko and other producers and customers.
Western Gas Equity Partners, LP (“WGP”) is a Delaware master limited partnership formed by Anadarko to own the following types of interests in WES: (i) the 2.0% general partner interest and all of the incentive distribution rights in WES, both owned through WGP’s 100% ownership of WES’s general partner, and (ii) a significant limited partner interest in WES.
For more information about Western Gas Partners, LP and Western Gas Equity Partners, LP, please visit www.westerngas.com.
This news release contains forward-looking statements. Western Gas Partners and Western Gas Equity Partners believe that their expectations are based on reasonable assumptions. No assurance, however, can be given that such expectations will prove to have been correct. A number of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this news release. These factors include the ability to meet financial guidance or distribution growth expectations; the ability to safely and efficiently operate WES’s assets; the ability to obtain new sources of natural gas supplies; the effect of fluctuations in commodity prices and the demand for natural gas and related products; the ability to meet projected in-service dates for capital growth projects; construction costs or capital expenditures exceeding estimated or budgeted costs or expenditures; and the other factors described in the “Risk Factors” sections of WES’s and WGP’s most recent Forms 10-K filed with the Securities and Exchange Commission and in their other public filings and press releases. Western Gas Partners and Western Gas Equity Partners undertake no obligation to publicly update or revise any forward-looking statements.
# # #
WESTERN GAS CONTACT
Benjamin Fink, CFA
SVP, Chief Financial Officer and Treasurer
832.636.6010
benjamin.fink@westerngas.com
3
Western Gas Partners, LP Reconciliation of GAAP to Non-GAAP Measures
Below are reconciliations of the Partnership’s Distributable cash flow (non-GAAP) to net income attributable to Western Gas Partners, LP (GAAP) and Adjusted EBITDA (non-GAAP) to net income attributable to Western Gas Partners, LP (GAAP) and net cash provided by operating activities (GAAP), as required under Regulation G of the Securities Exchange Act of 1934. Management believes that the Partnership’s Distributable cash flow, Adjusted EBITDA and Coverage ratio are widely accepted financial indicators of the Partnership’s financial performance compared to other publicly traded partnerships and are useful in assessing the Partnership’s ability to incur and service debt, fund capital expenditures and make distributions. Distributable cash flow, Adjusted EBITDA and Coverage ratio, as defined by the Partnership, may not be comparable to similarly titled measures used by other companies. Therefore, the Partnership’s Distributable cash flow, Adjusted EBITDA and Coverage ratio should be considered in conjunction with net income and other applicable performance measures, such as operating income or cash flows from operating activities.
Distributable Cash Flow
The Partnership defines Distributable cash flow as Adjusted EBITDA, plus interest income, less net cash paid for interest expense (including amortization of deferred debt issuance costs originally paid in cash, offset by non-cash capitalized interest), maintenance capital expenditures, and income taxes.
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
thousands except Coverage ratio | 2013 | 2012 (1) | 2013 | 2012 (1) | |||||||||||||
Reconciliation of Net income attributable to Western Gas Partners, LP to Distributable cash flow and calculation of the Coverage ratio | |||||||||||||||||
Net income attributable to Western Gas Partners, LP | $ | 78,400 | $ | 46,579 | $ | 189,257 | $ | 143,539 | |||||||||
Add: | |||||||||||||||||
Distributions from equity investees | 4,531 | 5,584 | 15,563 | 15,603 | |||||||||||||
Non-cash equity-based compensation expense | 962 | 9,417 | 2,663 | 16,407 | |||||||||||||
Interest expense, net (non-cash settled) | — | 81 | — | 244 | |||||||||||||
Income tax expense | 58 | 5,080 | 4,431 | 14,588 | |||||||||||||
Depreciation, amortization and impairments (2) | 36,970 | 28,011 | 104,651 | 81,507 | |||||||||||||
Other expense (2) | — | — | — | 1,665 | |||||||||||||
Less: | |||||||||||||||||
Equity income, net | 4,501 | 3,804 | 12,205 | 10,752 | |||||||||||||
Cash paid for maintenance capital expenditures (2) (4) | 7,389 | 13,398 | 19,595 | 28,863 | |||||||||||||
Capitalized interest | 3,111 | 2,224 | 9,552 | 3,827 | |||||||||||||
Cash paid for income taxes | — | 423 | — | 495 | |||||||||||||
Other income (2) (3) | 39 | 125 | 419 | 187 | |||||||||||||
Distributable cash flow | $ | 105,881 | $ | 74,778 | $ | 274,794 | $ | 229,429 | |||||||||
Distributions declared (5) | |||||||||||||||||
Limited partners | $ | 65,181 | $ | 184,734 | |||||||||||||
General partner | 18,805 | 48,710 | |||||||||||||||
Total | $ | 83,986 | $ | 233,444 | |||||||||||||
Coverage ratio | 1.26 | x | 1.18 | x | |||||||||||||
(1) | Financial information has been recast to include the financial position and results attributable to the Non-Operated Marcellus Interest. |
(2) | Includes the Partnership’s 51% share prior to August 1, 2012, and its 75% share after August 1, 2012, of depreciation, amortization and impairments; other expense; cash paid for maintenance capital expenditures; and other income attributable to Chipeta. |
(3) | Excludes income of $0.4 million and $1.2 million for each of the three and nine months ended September 30, 2013 and 2012, respectively, related to a component of a gas processing agreement accounted for as a capital lease. |
(4) | Net of a prior period adjustment reclassifying $0.7 million from capital expenditures to operating expenses for the nine months ended September 30, 2012. |
(5) | Reflects distributions of $0.58 and $1.68 per unit declared for the three and nine months ended September 30, 2013, respectively. |
4
Western Gas Partners, LP Reconciliation of GAAP to Non-GAAP Measures, continued
Adjusted EBITDA
The Partnership defines Adjusted EBITDA as net income attributable to Western Gas Partners, LP, plus distributions from equity investees, non-cash equity-based compensation expense, interest expense, income tax expense, depreciation, amortization and impairments, and other expense, less income from equity investments, interest income, income tax benefit, and other income.
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||
thousands | 2013 | 2012 (1) | 2013 | 2012 (1) | ||||||||||||||
Reconciliation of Net income attributable to Western Gas Partners, LP to Adjusted EBITDA | ||||||||||||||||||
Net income attributable to Western Gas Partners, LP | $ | 78,400 | $ | 46,579 | $ | 189,257 | $ | 143,539 | ||||||||||
Add: | ||||||||||||||||||
Distributions from equity investees | 4,531 | 5,584 | 15,563 | 15,603 | ||||||||||||||
Non-cash equity-based compensation expense | 962 | 9,417 | 2,663 | 16,407 | ||||||||||||||
Interest expense | 13,018 | 10,977 | 37,483 | 30,118 | ||||||||||||||
Income tax expense | 58 | 5,080 | 4,431 | 14,588 | ||||||||||||||
Depreciation, amortization and impairments (2) | 36,970 | 28,011 | 104,651 | 81,507 | ||||||||||||||
Other expense (2) | — | — | — | 1,665 | ||||||||||||||
Less: | ||||||||||||||||||
Equity income, net | 4,501 | 3,804 | 12,205 | 10,752 | ||||||||||||||
Interest income, net – affiliates | 4,225 | 4,225 | 12,675 | 12,675 | ||||||||||||||
Other income (2) (3) | 39 | 125 | 419 | 187 | ||||||||||||||
Adjusted EBITDA | $ | 125,174 | $ | 97,494 | $ | 328,749 | $ | 279,813 | ||||||||||
Reconciliation of Adjusted EBITDA to Net cash provided by operating activities | ||||||||||||||||||
Adjusted EBITDA attributable to Western Gas Partners, LP | $ | 125,174 | $ | 97,494 | $ | 328,749 | $ | 279,813 | ||||||||||
Adjusted EBITDA attributable to noncontrolling interests | 4,017 | 3,866 | 9,362 | 13,709 | ||||||||||||||
Interest income (expense), net | (8,793 | ) | (6,752 | ) | (24,808 | ) | (17,443 | ) | ||||||||||
Non-cash equity based compensation expense | (80 | ) | (8,482 | ) | (99 | ) | (13,638 | ) | ||||||||||
Debt-related amortization and other items, net | 630 | 698 | 1,756 | 1,728 | ||||||||||||||
Current income tax expense | (80 | ) | 646 | (3,224 | ) | 6,977 | ||||||||||||
Other income (expense), net (3) | 43 | 126 | 424 | (1,475 | ) | |||||||||||||
Distributions from equity investees less than (in excess of) equity income, net | (30 | ) | (1,780 | ) | (3,358 | ) | (4,851 | ) | ||||||||||
Changes in operating working capital: | ||||||||||||||||||
Accounts receivable and natural gas imbalance receivable | (1,304 | ) | 34,817 | (28,425 | ) | 47,403 | ||||||||||||
Accounts payable, accrued liabilities and natural gas imbalance payable | 6,482 | 39,209 | 6,818 | 29,261 | ||||||||||||||
Other | (2,003 | ) | (2,441 | ) | 1,874 | 2,103 | ||||||||||||
Net cash provided by operating activities | $ | 124,056 | $ | 157,401 | $ | 289,069 | $ | 343,587 | ||||||||||
Cash flow information of Western Gas Partners, LP | ||||||||||||||||||
Net cash provided by operating activities | $ | 289,069 | $ | 343,587 | ||||||||||||||
Net cash used in investing activities | $ | (1,226,404 | ) | $ | (1,009,296 | ) | ||||||||||||
Net cash provided by financing activities | $ | 555,718 | $ | 486,644 | ||||||||||||||
(1) | Financial information has been recast to include the financial position and results attributable to the Non-Operated Marcellus Interest. |
(2) | Includes the Partnership’s 51% share prior to August 1, 2012, and its 75% share after August 1, 2012, of depreciation, amortization and impairments; other expense; and other income attributable to Chipeta. |
(3) | Excludes income of $0.4 million and $1.2 million for each of the three and nine months ended September 30, 2013 and 2012, respectively, related to a component of a gas processing agreement accounted for as a capital lease. |
5
Western Gas Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
thousands except unit and per-unit amounts | 2013 | 2012 (1) | 2013 | 2012 (1) | |||||||||||||
Revenues | |||||||||||||||||
Gathering, processing and transportation of natural gas and natural gas liquids | $ | 130,781 | $ | 93,933 | $ | 343,471 | $ | 278,966 | |||||||||
Natural gas, natural gas liquids and condensate sales | 141,326 | 136,106 | 402,616 | 386,818 | |||||||||||||
Equity income and other, net | 5,894 | 4,695 | 16,787 | 13,936 | |||||||||||||
Total revenues | 278,001 | 234,734 | 762,874 | 679,720 | |||||||||||||
Operating expenses | |||||||||||||||||
Cost of product | 93,516 | 89,107 | 270,059 | 254,719 | |||||||||||||
Operation and maintenance | 42,757 | 35,493 | 121,165 | 103,304 | |||||||||||||
General and administrative | 7,276 | 15,039 | 22,228 | 35,623 | |||||||||||||
Property and other taxes | 6,649 | 5,328 | 18,520 | 14,998 | |||||||||||||
Depreciation, amortization and impairments | 37,615 | 28,455 | 106,551 | 83,263 | |||||||||||||
Total operating expenses | 187,813 | 173,422 | 538,523 | 491,907 | |||||||||||||
Operating income | 90,188 | 61,312 | 224,351 | 187,813 | |||||||||||||
Interest income, net – affiliates | 4,225 | 4,225 | 12,675 | 12,675 | |||||||||||||
Interest expense | (13,018 | ) | (10,977 | ) | (37,483 | ) | (30,118 | ) | |||||||||
Other income (expense), net | 439 | 522 | 1,612 | (287 | ) | ||||||||||||
Income before income taxes | 81,834 | 55,082 | 201,155 | 170,083 | |||||||||||||
Income tax expense | 58 | 5,080 | 4,431 | 14,588 | |||||||||||||
Net income | 81,776 | 50,002 | 196,724 | 155,495 | |||||||||||||
Net income attributable to noncontrolling interests | 3,376 | 3,423 | 7,467 | 11,956 | |||||||||||||
Net income attributable to Western Gas Partners, LP | $ | 78,400 | $ | 46,579 | $ | 189,257 | $ | 143,539 | |||||||||
Limited partners’ interest in net income: | |||||||||||||||||
Net income attributable to Western Gas Partners, LP | $ | 78,400 | $ | 46,579 | $ | 189,257 | $ | 143,539 | |||||||||
Pre-acquisition net (income) loss allocated to Anadarko | — | (7,062 | ) | (4,637 | ) | (19,582 | ) | ||||||||||
General partner interest in net (income) loss | (18,693 | ) | (8,042 | ) | (47,733 | ) | (18,508 | ) | |||||||||
Limited partners’ interest in net income | $ | 59,707 | $ | 31,475 | $ | 136,887 | $ | 105,449 | |||||||||
Net income per common unit – basic and diluted | $ | 0.53 | $ | 0.33 | $ | 1.26 | $ | 1.14 | |||||||||
Weighted average common units outstanding – basic and diluted | 112,143 | 95,883 | 108,540 | 92,627 | |||||||||||||
(1) | Financial information has been recast to include the financial position and results attributable to the Non-Operated Marcellus Interest. |
6
Western Gas Partners, LP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
thousands except number of units | September 30, 2013 | December 31, 2012 (1) | ||||||||
Current assets | $ | 122,915 | $ | 477,212 | ||||||
Note receivable – Anadarko | 260,000 | 260,000 | ||||||||
Net property, plant and equipment | 3,243,900 | 2,717,956 | ||||||||
Other assets | 415,416 | 294,754 | ||||||||
Total assets | $ | 4,042,231 | $ | 3,749,922 | ||||||
Current liabilities | $ | 177,959 | $ | 185,306 | ||||||
Long-term debt | 1,518,110 | 1,168,278 | ||||||||
Asset retirement obligations and other | 78,166 | 115,902 | ||||||||
Total liabilities | $ | 1,774,235 | $ | 1,469,486 | ||||||
Equity and partners’ capital | ||||||||||
Common units (112,174,911 and 104,660,553 units issued and outstanding at September 30, 2013, and December 31, 2012, respectively) | $ | 2,127,040 | $ | 1,957,066 | ||||||
General partner units (2,288,573 and 2,135,930 units issued and outstanding at September 30, 2013, and December 31, 2012, respectively) | 68,585 | 52,752 | ||||||||
Net investment by Anadarko | — | 199,960 | ||||||||
Noncontrolling interests | 72,371 | 70,658 | ||||||||
Total liabilities, equity and partners’ capital | $ | 4,042,231 | $ | 3,749,922 | ||||||
(1) | Financial information has been recast to include the financial position and results attributable to the Non-Operated Marcellus Interest. |
7
Western Gas Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended September 30, | |||||||||
thousands | 2013 | 2012 (1) | |||||||
Cash flows from operating activities | |||||||||
Net income | $ | 196,724 | $ | 155,495 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
Depreciation, amortization and impairments | 106,551 | 83,263 | |||||||
Change in other items, net | (14,206 | ) | 104,829 | ||||||
Net cash provided by operating activities | $ | 289,069 | $ | 343,587 | |||||
Cash flows from investing activities | |||||||||
Capital expenditures | $ | (469,678 | ) | $ | (403,949 | ) | |||
Acquisitions from affiliates | (469,884 | ) | (605,960 | ) | |||||
Acquisitions from third parties | (240,274 | ) | — | ||||||
Investments in equity affiliates | (45,126 | ) | (147 | ) | |||||
Proceeds from the sale of assets to affiliates | 82 | 760 | |||||||
Other | (1,524 | ) | — | ||||||
Net cash used in investing activities | $ | (1,226,404 | ) | $ | (1,009,296 | ) | |||
Cash flows from financing activities | |||||||||
Borrowings, net of debt issuance costs | $ | 842,566 | $ | 885,291 | |||||
Repayments of debt | (495,000 | ) | (549,000 | ) | |||||
Increase (decrease) in outstanding checks | (3,335 | ) | 2,534 | ||||||
Proceeds from the issuance of common and general partner units, net of offering expenses | 427,848 | 216,462 | |||||||
Distributions to unitholders | (215,115 | ) | (141,505 | ) | |||||
Contributions from noncontrolling interest owners | 2,247 | 26,888 | |||||||
Distributions to noncontrolling interest owners | (8,001 | ) | (14,303 | ) | |||||
Net contributions from (distributions to) Anadarko | 4,508 | 60,277 | |||||||
Net cash provided by financing activities | $ | 555,718 | $ | 486,644 | |||||
Net increase (decrease) in cash and cash equivalents | $ | (381,617 | ) | $ | (179,065 | ) | |||
Cash and cash equivalents at beginning of period | 419,981 | 226,559 | |||||||
Cash and cash equivalents at end of period | $ | 38,364 | $ | 47,494 | |||||
(1) | Financial information has been recast to include the financial position and results attributable to the Non-Operated Marcellus Interest. |
8
Western Gas Partners, LP
OPERATING STATISTICS
(Unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||
MMcf/d except per-unit amounts | 2013 | 2012 (1) | 2013 | 2012 (1) | ||||||||||||||
Throughput | ||||||||||||||||||
Gathering, treating and transportation (2) | 1,844 | 1,576 | 1,746 | 1,598 | ||||||||||||||
Processing (3) | 1,397 | 1,228 | 1,320 | 1,182 | ||||||||||||||
Equity investment (4) | 221 | 236 | 211 | 236 | ||||||||||||||
Total throughput (5) | 3,462 | 3,040 | 3,277 | 3,016 | ||||||||||||||
Throughput attributable to noncontrolling interests | 177 | 204 | 166 | 254 | ||||||||||||||
Total throughput attributable to Western Gas Partners, LP | 3,285 | 2,836 | 3,111 | 2,762 | ||||||||||||||
Gross margin per Mcf attributable to Western Gas Partners, LP (6) | $ | 0.59 | $ | 0.54 | $ | 0.57 | $ | 0.54 | ||||||||||
(1) | Throughput has been recast to include volumes attributable to the Non-Operated Marcellus Interest. |
(2) | Excludes average NGL pipeline volumes of 25 MBbls/d and 22 MBbls/d for the three and nine months ended September 30, 2013, respectively, and 22 MBbls/d and 25 MBbls/d for the three and nine months ended September 30, 2012, respectively. Includes 100% of Wattenberg system volumes for all periods presented, and throughput beginning March 2013 attributable to the Anadarko-Operated Marcellus Interest. |
(3) | Consists of 100% of Chipeta, Hilight and Platte Valley system volumes, 100% of the Granger and Red Desert complex volumes, and 50% of Newcastle volumes. |
(4) | Represents our 14.81% share of Fort Union and 22% share of Rendezvous gross volumes, and excludes our 10% share of average White Cliffs pipeline volumes consisting of 6 MBbls/d and 7 MBbls/d for the three and nine months ended September 30, 2013, respectively, and 6 MBbls/d for both the three and nine months ended September 30, 2012. |
(5) | Includes affiliate, third-party and equity-investment volumes. |
(6) | Average for period. Calculated as gross margin, excluding the noncontrolling interest owners’ proportionate share of revenues and cost of product, divided by total throughput attributable to the Partnership (excluding throughput measured in barrels). Calculation includes gross margin attributable to our NGL pipelines and income attributable to our investments in Fort Union, White Cliffs and Rendezvous and volumes attributable to our investments in Fort Union and Rendezvous. |
9
Western Gas Partners, LP
UPDATED GUIDANCE
(Unaudited)
millions except percentages | Previously Announced | Current | Variance | ||||||
Adjusted EBITDA | $410 | - | $450 | $440 | - | $450 | $15 | ||
Maintenance capital expenditures as a percentage of Adjusted EBITDA | 9% | - | 12% | 7% | - | 10% | (2)% | ||
Total capital expenditures (1) | $670 | - | $740 | $670 | - | $740 | none | ||
Minimum WES distribution growth | 15% | 16% | 1% | ||||||
Minimum WGP distribution growth | 33% | 37% | 4% | ||||||
(1) | Does not include acquisitions or equity investments. |
10
Western Gas Equity Partners, LP
CALCULATION OF CASH AVAILABLE FOR DISTRIBUTION
(Unaudited)
thousands except per-unit amount and Coverage ratio | Three Months Ended September 30, 2013 | ||||
Distributions declared by Western Gas Partners, LP: | |||||
General partner interest | $ | 1,680 | |||
Incentive distribution rights | 17,126 | ||||
Common units held by WGP | 28,592 | ||||
Less: | |||||
Public company general and administrative expense | 603 | ||||
Cash available for distribution | $ | 46,795 | |||
Declared distribution per common unit | $ | 0.21375 | |||
Distributions declared by Western Gas Equity Partners, LP | $ | 46,789 | |||
Coverage ratio | 1.00 | x | |||
11
Western Gas Equity Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
thousands except unit and per-unit amounts | 2013 | 2012 (1) | 2013 | 2012 (1) | |||||||||||||
Revenues | |||||||||||||||||
Gathering, processing and transportation of natural gas and natural gas liquids | $ | 130,781 | $ | 93,933 | $ | 343,471 | $ | 278,966 | |||||||||
Natural gas, natural gas liquids and condensate sales | 141,326 | 136,106 | 402,616 | 386,818 | |||||||||||||
Equity income and other, net | 5,894 | 4,695 | 16,787 | 13,936 | |||||||||||||
Total revenues | 278,001 | 234,734 | 762,874 | 679,720 | |||||||||||||
Operating expenses | |||||||||||||||||
Cost of product | 93,516 | 89,107 | 270,059 | 254,719 | |||||||||||||
Operation and maintenance | 42,757 | 35,493 | 121,165 | 103,304 | |||||||||||||
General and administrative | 7,962 | 15,039 | 25,100 | 35,623 | |||||||||||||
Property and other taxes | 6,649 | 5,328 | 18,520 | 14,998 | |||||||||||||
Depreciation, amortization and impairments | 37,615 | 28,455 | 106,551 | 83,263 | |||||||||||||
Total operating expenses | 188,499 | 173,422 | 541,395 | 491,907 | |||||||||||||
Operating income | 89,502 | 61,312 | 221,479 | 187,813 | |||||||||||||
Interest income, net – affiliates | 4,225 | 4,225 | 12,675 | 12,675 | |||||||||||||
Interest expense | (13,018 | ) | (10,977 | ) | (37,483 | ) | (30,118 | ) | |||||||||
Other income (expense), net | 466 | 522 | 1,686 | (287 | ) | ||||||||||||
Income before income taxes | 81,175 | 55,082 | 198,357 | 170,083 | |||||||||||||
Income tax expense | 58 | 14,166 | 4,431 | 43,790 | |||||||||||||
Net income | 81,117 | 40,916 | 193,926 | 126,293 | |||||||||||||
Net income attributable to noncontrolling interests | 36,779 | 21,605 | 82,562 | 71,258 | |||||||||||||
Net income attributable to Western Gas Equity Partners, LP | $ | 44,338 | $ | 19,311 | $ | 111,364 | $ | 55,035 | |||||||||
Limited partners’ interest in net income: (2) | |||||||||||||||||
Net income attributable to Western Gas Equity Partners, LP | $ | 44,338 | $ | 111,364 | |||||||||||||
Pre-acquisition net (income) loss allocated to Anadarko | — | (4,637 | ) | ||||||||||||||
Limited partners’ interest in net income | $ | 44,338 | $ | 106,727 | |||||||||||||
Net income per common unit – basic and diluted (2) | $ | 0.20 | $ | 0.49 | |||||||||||||
Weighted average number of common units outstanding – basic and diluted (2) | 218,896 | 218,896 | |||||||||||||||
(1) | Financial information has been recast to include the financial position and results attributable to the Non-Operated Marcellus Interest. |
(2) | Amounts not applicable prior to WGP’s IPO on December 12, 2012. |
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Western Gas Equity Partners, LP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
thousands except number of units | September 30, 2013 | December 31, 2012 (1) | ||||||||
Current assets | $ | 141,690 | $ | 478,104 | ||||||
Note receivable – Anadarko | 260,000 | 260,000 | ||||||||
Net property, plant and equipment | 3,243,900 | 2,717,956 | ||||||||
Other assets | 415,416 | 294,754 | ||||||||
Total assets | $ | 4,061,006 | $ | 3,750,814 | ||||||
Current liabilities | $ | 178,116 | $ | 186,255 | ||||||
Long-term debt | 1,518,110 | 1,168,278 | ||||||||
Asset retirement obligations and other | 78,166 | 115,902 | ||||||||
Total liabilities | $ | 1,774,392 | $ | 1,470,435 | ||||||
Equity and partners’ capital | ||||||||||
Common units (218,895,515 issued and outstanding at September 30, 2013, and December 31, 2012) | $ | 825,074 | $ | 912,376 | ||||||
Net investment by Anadarko | — | 199,960 | ||||||||
Noncontrolling interests | 1,461,540 | 1,168,043 | ||||||||
Total liabilities, equity and partners’ capital | $ | 4,061,006 | $ | 3,750,814 | ||||||
(1) | Financial information has been recast to include the financial position and results attributable to the Non-Operated Marcellus Interest. |
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Western Gas Equity Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended September 30, | |||||||||
thousands | 2013 | 2012 (1) | |||||||
Cash flows from operating activities | |||||||||
Net income | $ | 193,926 | $ | 126,293 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
Depreciation, amortization and impairments | 106,551 | 83,263 | |||||||
Change in other items, net | (14,406 | ) | 72,000 | ||||||
Net cash provided by operating activities | $ | 286,071 | $ | 281,556 | |||||
Cash flows from investing activities | |||||||||
Capital expenditures | $ | (469,678 | ) | $ | (403,949 | ) | |||
Acquisitions from affiliates | (469,884 | ) | (605,960 | ) | |||||
Acquisitions from third parties | (240,274 | ) | — | ||||||
Investments in equity affiliates | (45,126 | ) | (147 | ) | |||||
Proceeds from the sale of assets to affiliates | 82 | 760 | |||||||
Other | (1,524 | ) | — | ||||||
Net cash used in investing activities | $ | (1,226,404 | ) | $ | (1,009,296 | ) | |||
Cash flows from financing activities | |||||||||
Borrowings, net of debt issuance costs | $ | 842,566 | $ | 885,291 | |||||
Repayments of debt | (495,000 | ) | (549,000 | ) | |||||
Increase (decrease) in outstanding checks | (3,335 | ) | 2,534 | ||||||
Proceeds from the issuance of WES common units, net of offering expenses | 418,570 | 211,965 | |||||||
Offering expenses from issuance of WGP common units | (2,367 | ) | — | ||||||
Contributions received from Chipeta noncontrolling interest owners (including Anadarko) | 2,247 | 26,888 | |||||||
Distributions to Chipeta noncontrolling interest owners (including Anadarko) | (8,001 | ) | (14,303 | ) | |||||
Distributions to WES common unitholders | (94,117 | ) | (71,890 | ) | |||||
Distributions to WGP unitholders | (90,211 | ) | — | ||||||
Net contributions from (distributions to) Anadarko | 4,508 | 57,190 | |||||||
Net cash provided by financing activities | $ | 574,860 | $ | 548,675 | |||||
Net increase (decrease) in cash and cash equivalents | $ | (365,473 | ) | $ | (179,065 | ) | |||
Cash and cash equivalents at beginning of period | 422,556 | 226,559 | |||||||
Cash and cash equivalents at end of period | $ | 57,083 | $ | 47,494 | |||||
(1) | Financial information has been recast to include the financial position and results attributable to the Non-Operated Marcellus Interest. |
14