Vanguard Natural Resources, LLC Announces Reduction in Common Unit Distribution and No Change to Preferred Unit Distributions...
December 18 2015 - 7:00AM
Vanguard Natural Resources, LLC (NASDAQ:VNR) (“Vanguard”) has
declared a cash distribution attributable to the month of November
2015 of $0.03 per common unit ($0.36 per unit on an annual basis)
payable on January 14, 2016 to common unitholders of record on
January 4, 2016. This distribution level represents an
approximate 75% reduction from the $0.1175 per common unit monthly
distribution ($1.41 per common unit on an annual basis) paid last
month. Based on yesterday’s closing price of $2.89, the new
distribution provides a current yield of 12.5%.
Vanguard has also declared cash distributions for its 7.875%
Series A Cumulative Redeemable Perpetual Preferred Units
(NASDAQ:VNRAP) of $0.1641 per unit, its 7.625% Series B Cumulative
Redeemable Perpetual Preferred Units (NASDAQ:VNRBP) of $0.15885 per
unit, and its 7.75% Series C Cumulative Redeemable Perpetual
Preferred Units (NASDAQ:VNRCP) of $0.16146 per unit, all payable on
January 15, 2016 to unitholders of record on January 4, 2016.
Scott W. Smith, President & CEO of Vanguard commented,
“Given the current commodity and capital markets environment, we
believe the most prudent strategy is to reduce the cash
distribution payout on our common units. Lowering the common
unit distribution from $1.41 annualized to $0.36 annualized reduces
the cash required for distributions from approximately $185 million
to $47 million. Excess cash flow that is generated by this
action will be directed at paying down debt under Vanguard’s
revolving credit facility and is expected to result in significant
distribution coverage in both 2016 and 2017 based on current
commodity strip prices. We believe it is in the best
long-term interest of the Company to redirect our excess cash flow
in this manner and better position Vanguard when a commodity price
recovery occurs in the future.”
About Vanguard Natural Resources, LLC
Vanguard Natural Resources, LLC is a publicly traded
limited liability company focused on the acquisition, production
and development of oil and natural gas properties. Vanguard’s
assets consist primarily of producing and non-producing oil and
natural gas reserves located in the Green River
Basin in Wyoming, the Arkoma
Basin in Arkansas and Oklahoma, the Anadarko Basin in
Oklahoma and North Texas, the Permian Basin in West
Texas and New Mexico, the Big Horn Basin
in Wyoming and Montana, the Piceance
Basin in Colorado, the Gulf Coast Basin in
Texas, Louisiana and Mississippi, the Williston
Basin in North Dakota and Montana, the Wind
River Basin in Wyoming and the Powder River
Basin in Wyoming. More information on Vanguard can be
found at www.vnrllc.com.
Forward-Looking Statements
We make statements in this news release that are considered
forward-looking statements within the meaning of the Securities
Exchange Act of 1934. These forward-looking statements are largely
based on our expectations, which reflect estimates and assumptions
made by our management. These estimates and assumptions reflect our
best judgment based on currently known market conditions and other
factors. Although we believe such estimates and assumptions to be
reasonable, they are inherently uncertain and involve a number of
risks and uncertainties that are beyond our control. In addition,
management's assumptions about future events may prove to be
inaccurate. Management cautions all readers that the
forward-looking statements contained in this news release are not
guarantees of future performance, and we cannot assure you that
such statements will be realized or the forward-looking events and
circumstances will occur. Actual results may differ materially from
those anticipated or implied in the forward-looking statements due
to factors listed in the "Risk Factors" section in our SEC filings
and elsewhere in those filings. All forward-looking statements
speak only as of the date of this news release. We do not intend to
publicly update or revise any forward-looking statements as a
result of new information, future events or otherwise.
This press release is intended to be a qualified notice under
Treasury Regulation Section 1.1446-4(b). Brokers and nominees
should treat one hundred percent (100.0%) of Vanguard's
distributions to non-U.S. investors as being attributable to income
that is effectively connected with a United States trade or
business. Accordingly, Vanguard’s distributions to
non-U.S. investors are subject to federal income tax withholding at
the highest applicable effective tax rate.
INVESTOR RELATIONS CONTACT:
Vanguard Natural Resources, LLC
Lisa Godfrey, 832-327-2234
Director, Investor Relations
investorrelations@vnrllc.com