July 26, 2016 - 4:05 PM EDT
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Western Gas Announces Second-Quarter 2016 Results

ANNOUNCES IMPROVED 2016 OUTLOOK

HOUSTON, July 26, 2016 /PRNewswire/ -- Western Gas Partners, LP (NYSE: WES) ("WES" or the "Partnership") and Western Gas Equity Partners, LP (NYSE: WGP) ("WGP") today announced second-quarter 2016 financial and operating results.

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WESTERN GAS PARTNERS, LP

Net income (loss) available to limited partners for the second quarter of 2016 totaled $83.0 million, or $0.55 per common unit (diluted), with second-quarter 2016 Adjusted EBITDA(1) of $250.6 million and second-quarter 2016 Distributable cash flow(1) of $199.3 million.

WES previously declared a quarterly distribution of $0.830 per unit for the second quarter of 2016. This distribution represented a 2% increase over the prior quarter's distribution and an 11% increase over the second-quarter 2015 distribution of $0.750 per unit. The second-quarter 2016 Coverage ratio(1) of 1.22 times was based on the quarterly distribution of $0.830 per unit and was calculated by dividing the quarter's Distributable cash flow(1) by quarterly distributions declared payable to the general partner and common unitholders. Inclusion of $9.9 million(2) of the expected recoveries under WES's business interruption insurance in Distributable cash flow(1) would result in a ratio of 1.29 times.

(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)

Represents the midpoint of WES's anticipated range of $10 million to $15 million in reimbursable amounts for the quarter, less $2.6 million of proceeds received during the quarter which are included in Adjusted EBITDA.

"In addition to delivering another solid financial quarter, we reached several important milestones in the Delaware Basin. We resumed full service at Ramsey III, and also completed Ramsey IV on schedule," said Chief Executive Officer, Don Sinclair. "Furthermore, Ramsey V and related facilities are due to come online at the end of the third quarter."

Total throughput attributable to WES for natural gas assets for the second quarter of 2016 averaged 3.9 Bcf/d, which was 2% above the prior quarter and 12% below the second quarter of 2015(2). Total throughput for crude/NGL assets for the second quarter of 2016 averaged 187 MBbls/d, which was 2% above the prior quarter and 1% above the second quarter of 2015(2).

Capital expenditures attributable to WES, including equity investments but excluding acquisitions, totaled $116.3 million on a cash basis and $118.9 million on an accrual basis during the second quarter of 2016, with maintenance capital expenditures on a cash basis of $21.1 million, or 8% of Adjusted EBITDA(1). WES is adjusting its outlook ranges for full-year Adjusted EBITDA(1) to $930 million to $970 million(3), and for total capital expenditures (including equity investments but excluding acquisitions) to $490 million to $530 million.

WESTERN GAS EQUITY PARTNERS, LP

WGP indirectly owns the entire general partner interest in WES, 100% of the incentive distribution rights in WES and 50,132,046 WES common units. Net income (loss) available to limited partners for the second quarter of 2016 totaled $88.9 million, or $0.41 per common unit (diluted).

WGP previously declared a quarterly distribution of $0.43375 per unit for the second quarter of 2016. This distribution represented a 2% increase over the prior quarter's distribution and a 19% increase over the second-quarter 2015 distribution of $0.36375 per unit. WGP received distributions from WES of $96.0 million attributable to the second quarter and will pay $95.0 million in distributions for the same period. The excellent performance of WES's portfolio has reduced its need for additional equity, and WGP's 2016 distribution growth rate will therefore be 19% to 21% depending on the size and timing of additional WES equity issuances, if any.

(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)

Financial and operational information for the second quarter of 2015 has been recast for the acquisition of Springfield.

(3)

This press release contains a forward-looking estimate of the range of Adjusted EBITDA projected to be generated by WES in its 2016 fiscal year. A reconciliation of such estimated range to net cash provided by operating activities and net income is not provided because the items necessary to estimate such amounts are not reasonably accessible or estimable at this time.

CONFERENCE CALL TOMORROW AT 11 A.M. CDT

WES and WGP will host a joint conference call on Wednesday, July 27, 2016, at 11:00 a.m. Central Daylight Time (12:00 p.m. Eastern Daylight Time) to discuss second-quarter 2016 results. Individuals who would like to participate should dial 844-836-8745 (Domestic) or 412-317-5439 (International) approximately 15 minutes before the scheduled conference call time. Pre-registration is available through the investor relations page at www.westerngas.com. Pre-registrants will be issued a personal identification number to use when dialing in to the live conference call, which will enable the participant to bypass the operator and gain immediate access to the call. To access the live audio webcast of the conference call, please visit the investor relations section of the Partnership's website at www.westerngas.com. A replay of the conference call will also be available on the website for two weeks following the call.

Western Gas Partners, LP ("WES") is a growth-oriented Delaware master limited partnership formed by Anadarko Petroleum Corporation to acquire, own, develop and operate midstream energy assets. With midstream assets located in the Rocky Mountains, the Mid-Continent, North-central Pennsylvania and Texas, WES is engaged in the business of gathering, processing, compressing, treating and transporting natural gas, condensate, natural gas liquids and crude oil for Anadarko, as well as for 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 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 and Forms 10-Q 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
Jonathon E. VandenBrand
Director, Investor Relations
[email protected]
832.636.1007

Western Gas Partners, LP Reconciliation of GAAP to Non-GAAP Measures

Below are reconciliations of (i) WES's Distributable cash flow (non-GAAP) to net income (loss) attributable to Western Gas Partners, LP (GAAP), (ii) Adjusted EBITDA attributable to Western Gas Partners, LP ("Adjusted EBITDA") (non-GAAP) to net income (loss) attributable to Western Gas Partners, LP (GAAP) and to net cash provided by operating activities (GAAP), and (iii) Adjusted gross margin attributable to Western Gas Partners, LP ("Adjusted gross margin") (non-GAAP) to operating income (loss) (GAAP), as required under Regulation G of the Securities Exchange Act of 1934. Management believes that WES's Distributable cash flow, Adjusted EBITDA, Adjusted gross margin, and Coverage ratio are widely accepted financial indicators of WES's financial performance compared to other publicly traded partnerships and are useful in assessing its ability to incur and service debt, fund capital expenditures and make distributions. Distributable cash flow, Adjusted EBITDA, Adjusted gross margin and Coverage ratio, as defined by WES, may not be comparable to similarly titled measures used by other companies. Therefore, WES's Distributable cash flow, Adjusted EBITDA, Adjusted gross margin and Coverage ratio should be considered in conjunction with net income (loss) and other applicable performance measures, such as operating income (loss) or cash flows from operating activities.

Western Gas Partners, LP Reconciliation of GAAP to Non-GAAP Measures, continued

Distributable Cash Flow

WES defines Distributable cash flow as Adjusted EBITDA, plus interest income and the net settlement amounts from the sale and/or purchase of natural gas, condensate and NGLs under WES's commodity price swap agreements to the extent such amounts are not recognized as Adjusted EBITDA, less net cash paid (or to be paid) for interest expense (including amortization of deferred debt issuance costs originally paid in cash, offset by non-cash capitalized interest), maintenance capital expenditures, Series A Preferred unit distributions and income taxes.

 



Three Months Ended
June 30,


Six Months Ended
June 30,

thousands except Coverage ratio


2016


2015 (1)


2016


2015 (1)

Reconciliation of Net income (loss) attributable to Western Gas Partners, LP to Distributable cash flow and calculation of the Coverage ratio









Net income (loss) attributable to Western Gas Partners, LP


$

164,521



$

132,343



$

280,581



$

(24,150)


Add:









Distributions from equity investees


24,491



25,902



49,130



47,572


Non-cash equity-based compensation expense


1,246



1,163



2,549



2,275


Interest expense, net (non-cash settled) (2)


(15,461)



4,190



(10,924)



5,610


Income tax (benefit) expense


326



12,246



6,959



24,516


Depreciation and amortization (3)


66,650



67,904



131,089



136,231


Impairments


2,403



1,620



8,921



274,244


Above-market component of swap extensions with Anadarko


9,552





16,365




Other expense (3)


56





56




Less:









Gain (loss) on divestiture and other, net


(1,907)





(2,539)



(6)


Equity income, net – affiliates


19,693



18,941



36,507



37,161


Cash paid for maintenance capital expenditures (3)


21,085



11,992



39,982



26,105


Capitalized interest


1,482



2,693



3,331



5,787


Cash paid for (reimbursement of) income taxes






67



(138)


Series A Preferred unit distributions


14,082





15,969




Other income (3)




68



122



137


Distributable cash flow


$

199,349



$

211,674



$

391,287



$

397,252


Distributions declared (4)









Limited partners – common units


$

108,458





$

214,951




General partner


54,369





106,781




Total


$

162,827





$

321,732




Coverage ratio


1.22


x



1.22


x




(1)

In March 2016, WES acquired Springfield Pipeline LLC ("Springfield") from Anadarko. Springfield owns a 50.1% interest in an oil gathering system and a gas gathering system, such interest being referred to as the "Springfield interest." Financial information has been recast to include the financial position and results attributable to the Springfield interest.

(2)

Includes accretion revisions related to the Deferred purchase price obligation - Anadarko associated with the acquisition of DBJV.

(3)

Includes WES's 75% share of depreciation and amortization; other expense; cash paid for maintenance capital expenditures; and other income attributable to Chipeta.

(4)

Reflects cash distributions of $0.830 and $1.645 per unit declared for the three and six months ended June 30, 2016, respectively.

 

Western Gas Partners, LP Reconciliation of GAAP to Non-GAAP Measures, continued

Adjusted EBITDA Attributable to Western Gas Partners, LP

WES defines Adjusted EBITDA as net income (loss) attributable to Western Gas Partners, LP, plus distributions from equity investees, non-cash equity-based compensation expense, interest expense, income tax expense, depreciation and amortization, impairments, and other expense (including lower of cost or market inventory adjustments recorded in cost of product), less gain (loss) on divestiture and other, net, income from equity investments, interest income, income tax benefit and other income.

 



Three Months Ended
June 30,


Six Months Ended
June 30,

thousands


2016


2015 (1)


2016


2015 (1)

Reconciliation of Net income (loss) attributable to Western Gas Partners, LP to Adjusted EBITDA attributable to Western Gas Partners, LP









Net income (loss) attributable to Western Gas Partners, LP


$

164,521



$

132,343



$

280,581



$

(24,150)


Add:









Distributions from equity investees


24,491



25,902



49,130



47,572


Non-cash equity-based compensation expense


1,246



1,163



2,549



2,275


Interest expense


12,883



27,604



44,919



50,564


Income tax expense


326



12,246



6,959



24,516


Depreciation and amortization (2)


66,650



67,904



131,089



136,231


Impairments


2,403



1,620



8,921



274,244


Other expense (2)


56





56




Less:









Gain (loss) on divestiture and other, net


(1,907)





(2,539)



(6)


Equity income, net – affiliates


19,693



18,941



36,507



37,161


Interest income – affiliates


4,225



4,225



8,450



8,450


Other income (2)




68



122



137


Adjusted EBITDA attributable to Western Gas Partners, LP


$

250,565



$

245,548



$

481,664



$

465,510



Reconciliation of Adjusted EBITDA attributable to Western Gas Partners, LP to Net cash provided by operating activities









Adjusted EBITDA attributable to Western Gas Partners, LP


$

250,565



$

245,548



$

481,664



$

465,510


Adjusted EBITDA attributable to noncontrolling interest


3,456



3,463



7,133



7,335


Interest income (expense), net


(8,658)



(23,379)



(36,469)



(42,114)


Uncontributed cash-based compensation awards


(86)



(68)



(158)



(145)


Accretion and amortization of long-term obligations, net


(14,522)



4,958



(9,055)



7,070


Current income tax benefit (expense)


(198)



(11,673)



(4,979)



(18,134)


Other income (expense), net


(53)



71



71



142


Distributions from equity investments in excess of cumulative earnings – affiliates


(5,827)



(5,574)



(10,611)



(8,538)


Changes in operating working capital:









  Accounts receivable, net


(45,800)



(26,725)



(33,242)



(41,358)


  Accounts and imbalance payables and accrued liabilities, net


(20,205)



(8,389)



(2,227)



4,407


  Other


(1,309)



(744)



1,739



(1,854)


Net cash provided by (used in) operating activities


$

157,363



$

177,488



$

393,866



$

372,321


Cash flow information of Western Gas Partners, LP









Net cash provided by (used in) operating activities






$

393,866



$

372,321


Net cash provided by (used in) investing activities






(952,824)



(371,878)


Net cash provided by (used in) financing activities






618,692



20,271




(1)

Financial information has been recast to include the financial position and results attributable to the Springfield interest.

(2)

Includes WES's 75% share of depreciation and amortization; other expense; and other income attributable to Chipeta.

 

Western Gas Partners, LP Reconciliation of GAAP to Non-GAAP Measures, continued

Adjusted gross margin attributable to Western Gas Partners, LP

WES defines Adjusted gross margin as total revenues and other, less cost of product and reimbursements for electricity-related expenses recorded as revenue, plus distributions from equity investees and excluding the noncontrolling interest owner's proportionate share of revenue and cost of product.

 



Three Months Ended
June 30,


Six Months Ended
June 30,

thousands


2016


2015 (1)


2016


2015 (1)

Reconciliation of Adjusted gross margin attributable to Western Gas Partners, LP to Operating income (loss)









Adjusted gross margin attributable to Western Gas Partners, LP for natural gas assets


$

294,661



$

293,560



$

571,190



$

564,806


Adjusted gross margin for crude/NGL assets


34,593



33,237



69,288



64,641


Adjusted gross margin attributable to Western Gas Partners, LP


329,254



326,797



640,478



629,447


Adjusted gross margin attributable to noncontrolling interest


4,183



4,661



8,604



9,469


Gain (loss) on divestiture and other, net


(1,907)





(2,539)



(6)


Proceeds from business interruption insurance claims


2,603





2,603




Equity income, net – affiliates


19,693



18,941



36,507



37,161


Reimbursed electricity-related charges recorded as revenues


14,869



13,221



30,537



25,031


Less:









Distributions from equity investees


24,491



25,902



49,130



47,572


Operation and maintenance


75,173



77,837



151,386



154,022


General and administrative


10,883



9,408



22,160



20,489


Property and other taxes


12,078



9,586



22,428



18,866


Depreciation and amortization


67,305



68,554



132,400



137,529


Impairments


2,403



1,620



8,921



274,244


Operating income (loss)


$

176,362



$

170,713



$

329,765



$

48,380




(1)

Financial information has been recast to include the financial position and results attributable to the Springfield interest.

 

Western Gas Partners, LP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)




Three Months Ended
June 30,


Six Months Ended
June 30,

thousands except per-unit amounts


2016


2015 (1)


2016


2015 (1)

Revenues and other









Gathering, processing and transportation


$

301,136



$

290,900



$

595,140



$

561,168


Natural gas and natural gas liquids sales


126,993



174,202



215,549



339,874


Other


535



891



1,116



1,957


Total revenues and other


428,664



465,993



811,805



902,999


Equity income, net – affiliates


19,693



18,941



36,507



37,161


Operating expenses









Cost of product


104,849



147,216



181,316



286,624


Operation and maintenance


75,173



77,837



151,386



154,022


General and administrative


10,883



9,408



22,160



20,489


Property and other taxes


12,078



9,586



22,428



18,866


Depreciation and amortization


67,305



68,554



132,400



137,529


Impairments


2,403



1,620



8,921



274,244


Total operating expenses


272,691



314,221



518,611



891,774


Gain (loss) on divestiture and other, net


(1,907)





(2,539)



(6)


Proceeds from business interruption insurance claims


2,603





2,603




Operating income (loss)


176,362



170,713



329,765



48,380


Interest income – affiliates


4,225



4,225



8,450



8,450


Interest expense


(12,883)



(27,604)



(44,919)



(50,564)


Other income (expense), net


(53)



71



71



142


Income (loss) before income taxes


167,651



147,405



293,367



6,408


Income tax (benefit) expense


326



12,246



6,959



24,516


Net income (loss)


167,325



135,159



286,408



(18,108)


Net income attributable to noncontrolling interest


2,804



2,816



5,827



6,042


Net income (loss) attributable to Western Gas Partners, LP


$

164,521



$

132,343



$

280,581



$

(24,150)


Limited partners' interest in net income (loss):









Net income (loss) attributable to Western Gas Partners, LP


$

164,521



$

132,343



$

280,581



$

(24,150)


Pre-acquisition net (income) loss allocated to Anadarko




(18,719)



(11,326)



(43,758)


Series A Preferred units interest in net (income) loss


(23,121)





(25,450)




General partner interest in net (income) loss


(58,381)



(45,971)



(113,781)



(83,148)


Common and Class C limited partners' interest in net income (loss)


$

83,019



$

67,653



$

130,024



$

(151,056)


Net income (loss) per common unit – basic and diluted


$

0.55



$

0.46



$

0.86



$

(1.14)


Weighted-average common units outstanding – basic


130,669



128,481



129,830



128,111


Weighted-average common units outstanding – diluted


163,227



139,504



153,291



139,092




(1)

Financial information has been recast to include the financial position and results attributable to the Springfield interest.

 

Western Gas Partners, LP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


thousands except number of units


June 30,
2016


December 31,
2015 (1)

Current assets


$

385,253



$

299,217


Note receivable – Anadarko


260,000



260,000


Net property, plant and equipment


5,002,144



4,858,779


Other assets


1,856,705



1,883,201


Total assets


$

7,504,102



$

7,301,197


Current liabilities


$

241,565



$

235,488


Long-term debt


2,932,004



2,690,651


Asset retirement obligations and other


143,159



268,356


Deferred purchase price obligation – Anadarko


29,150



188,674


Total liabilities


$

3,345,878



$

3,383,169


Equity and partners' capital





Series A Preferred units (21,922,831 and zero units issued and outstanding at June 30, 2016, and December 31, 2015, respectively)


$

617,094



$


Common units (130,671,970 and 128,576,965 units issued and outstanding at June 30, 2016, and December 31, 2015, respectively)


2,613,806



2,588,991


Class C units (11,946,008 and 11,411,862 units issued and outstanding at June 30, 2016, and December 31, 2015, respectively)


729,731



710,891


General partner units (2,583,068 units issued and outstanding at June 30, 2016, and December 31, 2015)


131,842



120,164


Net investment by Anadarko




430,598


Noncontrolling interest


65,751



67,384


Total liabilities, equity and partners' capital


$

7,504,102



$

7,301,197




(1)

Financial information has been recast to include the financial position and results attributable to the Springfield interest.

 

Western Gas Partners, LP

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)




Six Months Ended
June 30,

thousands


2016


2015 (1)

Cash flows from operating activities





Net income (loss)


$

286,408



$

(18,108)


Adjustments to reconcile net income (loss) to net cash provided by operating activities and changes in working capital:





Depreciation and amortization


132,400



137,529


Impairments


8,921



274,244


(Gain) loss on divestiture and other, net


2,539



6


Change in other items, net


(36,402)



(21,350)


Net cash provided by (used in) operating activities


$

393,866



$

372,321


Cash flows from investing activities





Capital expenditures


$

(255,923)



$

(361,798)


Contributions in aid of construction costs from affiliates


3,854




Acquisitions from affiliates


(715,199)



(9,056)


Acquisitions from third parties




(3,514)


Investments in equity affiliates


139



(6,770)


Distributions from equity investments in excess of cumulative earnings – affiliates


10,611



8,538


Proceeds from the sale of assets to affiliates


613



700


Proceeds from the sale of assets to third parties


137



22


Proceeds from property insurance claims


2,944




Net cash provided by (used in) investing activities


$

(952,824)



$

(371,878)


Cash flows from financing activities





Borrowings, net of debt issuance costs


$

530,000



$

769,694


Repayments of debt


(290,000)



(520,000)


Increase (decrease) in outstanding checks


(1,314)



(2,938)


Proceeds from the issuance of common units, net of offering expenses


25,000



57,376


Proceeds from the issuance of Series A Preferred units, net of offering expenses


686,940




Distributions to unitholders


(313,380)



(259,247)


Distributions to noncontrolling interest owner


(7,460)



(7,175)


Net contributions from (distributions to) Anadarko


(27,459)



(17,439)


Above-market component of swap extensions with Anadarko


16,365




Net cash provided by (used in) financing activities


$

618,692



$

20,271


Net increase (decrease) in cash and cash equivalents


$

59,734



$

20,714


Cash and cash equivalents at beginning of period


98,033



67,054


Cash and cash equivalents at end of period


$

157,767



$

87,768




(1)

Financial information has been recast to include the financial position and results attributable to the Springfield interest.

 

Western Gas Partners, LP

OPERATING STATISTICS

(Unaudited)




Three Months Ended
June 30,


Six Months Ended
June 30,



2016


2015 (1)


2016


2015 (1)

Throughput for natural gas assets (MMcf/d)









Gathering, treating and transportation


1,508



1,920



1,553



1,942


Processing


2,320



2,465



2,226



2,362


Equity investment (2)


170



172



178



169


  Total throughput for natural gas assets


3,998



4,557



3,957



4,473


  Throughput attributable to noncontrolling interest for natural gas assets


128



159



132



161


Total throughput attributable to Western Gas Partners, LP for natural gas assets


3,870



4,398



3,825



4,312


Throughput for crude/NGL assets (MBbls/d)









Gathering, treating and transportation


59



74



59



75


Equity investment (3)


128



111



127



109


  Total throughput for crude/NGL assets


187



185



186



184


Adjusted gross margin per Mcf attributable to Western Gas Partners, LP for natural gas assets (4)


$

0.84



$

0.73



$

0.82



$

0.72


Adjusted gross margin per Bbl for crude/NGL assets (5)


2.03



1.98



2.05



1.95





















(1)

Throughput and adjusted gross margin have been recast to include results attributable to the Springfield interest.

(2)

Represents WES's 14.81% share of average Fort Union throughput and 22% share of average Rendezvous throughput.

(3)

Represents WES's 10% share of average White Cliffs throughput, WES's 25% share of average Mont Belvieu JV throughput, WES's 20% share of average TEG and TEP throughput, and WES's 33.33% share of average FRP throughput.

(4)

Average for period. Calculated as Adjusted gross margin attributable to Western Gas Partners, LP for natural gas assets (total revenues and other for natural gas assets, less reimbursements for electricity-related expenses recorded as revenue and cost of product for natural gas assets, plus distributions from WES's equity investments in Fort Union and Rendezvous, and excluding the noncontrolling interest owner's proportionate share of revenue and cost of product), divided by total throughput (MMcf/d) attributable to Western Gas Partners, LP for natural gas assets.

(5)

Average for period. Calculated as Adjusted gross margin for crude/NGL assets (total revenues and other for crude/NGL assets, less reimbursements for electricity-related expenses recorded as revenue and cost of product for crude/NGL assets, plus distributions from WES's equity investments in White Cliffs, the Mont Belvieu JV, TEG, TEP and FRP), divided by total throughput (MBbls/d) for crude/NGL assets.

 

Western Gas Equity Partners, LP

CALCULATION OF CASH AVAILABLE FOR DISTRIBUTION

(Unaudited)


thousands except per-unit amount and Coverage ratio


Three Months Ended
June 30, 2016

Distributions declared by Western Gas Partners, LP:



General partner interest


$

3,156


Incentive distribution rights


51,213


Common units held by WGP


41,610


Less:



Public company general and administrative expense


1,004


Interest expense


547


Cash available for distribution


$

94,428


Declared distribution per common unit


$

0.43375


Distributions declared by Western Gas Equity Partners, LP


$

94,958


Coverage ratio


0.99

x

 

Western Gas Equity Partners, LP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)




Three Months Ended
June 30,


Six Months Ended
June 30,

thousands except per-unit amounts


2016


2015 (1)


2016


2015 (1)

Revenues and other









Gathering, processing and transportation


$

301,136



$

290,900



$

595,140



$

561,168


Natural gas and natural gas liquids sales


126,993



174,202



215,549



339,874


Other


535



891



1,116



1,957


Total revenues and other


428,664



465,993



811,805



902,999


Equity income, net – affiliates


19,693



18,941



36,507



37,161


Operating expenses









Cost of product


104,849



147,216



181,316



286,624


Operation and maintenance


75,173



77,837



151,386



154,022


General and administrative


11,887



10,183



24,402



22,099


Property and other taxes


12,093



9,612



22,443



18,892


Depreciation and amortization


67,305



68,554



132,400



137,529


Impairments


2,403



1,620



8,921



274,244


Total operating expenses


273,710



315,022



520,868



893,410


Gain (loss) on divestiture and other, net


(1,907)





(2,539)



(6)


Proceeds from business interruption insurance claims


2,603





2,603




Operating income (loss)


175,343



169,912



327,508



46,744


Interest income – affiliates


4,225



4,225



8,450



8,450


Interest expense


(13,429)



(27,604)



(45,568)



(50,566)


Other income (expense), net


(36)



80



105



160


Income (loss) before income taxes


166,103



146,613



290,495



4,788


Income tax (benefit) expense


326



12,246



6,959



24,516


Net income (loss)


165,777



134,367



283,536



(19,728)


Net income (loss) attributable to noncontrolling interests


76,914



46,716



112,857



(91,007)


Net income (loss) attributable to Western Gas Equity Partners, LP


$

88,863



$

87,651



$

170,679



$

71,279


Limited partners' interest in net income (loss):









Net income (loss) attributable to Western Gas Equity Partners, LP


$

88,863



$

87,651



$

170,679



$

71,279


Pre-acquisition net (income) loss allocated to Anadarko




(18,719)



(11,326)



(43,758)


Limited partners' interest in net income (loss)


$

88,863



$

68,932



$

159,353



$

27,521


Net income (loss) per common unit – basic and diluted


$

0.41



$

0.31



$

0.73



$

0.13


Weighted-average common units outstanding – basic and diluted


218,921



218,912



218,920



218,911




(1)

Financial information has been recast to include the financial position and results attributable to the Springfield interest.

 

Western Gas Equity Partners, LP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


thousands except number of units


June 30,
2016


December 31,
2015 (1)

Current assets


$

387,167



$

301,364


Note receivable – Anadarko


260,000



260,000


Net property, plant and equipment


5,002,144



4,858,779


Other assets


1,858,502



1,883,201


Total assets


$

7,507,813



$

7,303,344


Current liabilities


$

241,706



$

235,565


Long-term debt


2,960,004



2,690,651


Asset retirement obligations and other


143,159



268,356


Deferred purchase price obligation – Anadarko


29,150



188,674


Total liabilities


$

3,374,019



$

3,383,246


Equity and partners' capital





Common units (218,922,303 and 218,919,380 units issued and outstanding at June 30, 2016, and December 31, 2015, respectively)


$

1,052,619



$

1,060,842


Net investment by Anadarko




430,598


Noncontrolling interests


3,081,175



2,428,658


Total liabilities, equity and partners' capital


$

7,507,813



$

7,303,344




(1)

Financial information has been recast to include the financial position and results attributable to the Springfield interest.

 

Western Gas Equity Partners, LP

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)




Six Months Ended
June 30,

thousands


2016


2015 (1)

Cash flows from operating activities





Net income (loss)


$

283,536



$

(19,728)


Adjustments to reconcile net income (loss) to net cash provided by operating activities and changes in working capital:





Depreciation and amortization


132,400



137,529


Impairments


8,921



274,244


(Gain) loss on divestiture and other, net


2,539



6


Change in other items, net


(35,581)



(20,828)


Net cash provided by (used in) operating activities


$

391,815



$

371,223


Cash flows from investing activities





Capital expenditures


$

(255,923)



$

(361,798)


Contributions in aid of construction costs from affiliates


3,854




Acquisitions from affiliates


(715,199)



(9,056)


Acquisitions from third parties




(3,514)


Investments in equity affiliates


139



(6,770)


Distributions from equity investments in excess of cumulative earnings – affiliates


10,611



8,538


Proceeds from the sale of assets to affiliates


613



700


Proceeds from the sale of assets to third parties


137



22


Proceeds from property insurance claims


2,944




Net cash provided by (used in) investing activities


$

(952,824)



$

(371,878)


Cash flows from financing activities





Borrowings, net of debt issuance costs


$

556,017



$

769,694


Repayments of debt


(290,000)



(521,150)


Increase (decrease) in outstanding checks


(1,314)



(2,938)


Proceeds from the issuance of WES common units, net of offering expenses




57,376


Proceeds from the issuance of WES Series A Preferred units, net of offering expenses


686,940




Distributions to WGP unitholders


(181,156)



(143,386)


Distributions to Chipeta noncontrolling interest owner


(7,460)



(7,175)


Distributions to noncontrolling interest owners of WES


(130,947)



(112,278)


Net contributions from (distributions to) Anadarko


(27,459)



(17,439)


Above-market component of swap extensions with Anadarko


16,365




Net cash provided by (used in) financing activities


$

620,986



$

22,704


Net increase (decrease) in cash and cash equivalents


$

59,977



$

22,049


Cash and cash equivalents at beginning of period


99,694



67,213


Cash and cash equivalents at end of period


$

159,671



$

89,262




(1)

Financial information has been recast to include the financial position and results attributable to the Springfield interest.

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/western-gas-announces-second-quarter-2016-results-300304341.html

SOURCE Western Gas


Source: PR Newswire (July 26, 2016 - 4:05 PM EDT)

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