HOUSTON, Nov. 3, 2016 /PRNewswire/ -- Cheniere
Energy, Inc. ("Cheniere") (NYSE MKT: LNG) reported a net
loss1 of $100.4 million,
or $0.44 per share (basic and
diluted), for the three months ended September 30, 2016, compared to a net loss of
$297.8 million, or $1.31 per share (basic and diluted), for the
comparable 2015 period. Net Loss, As Adjusted2 was
$94.2 million, or $0.41 per share (basic and diluted), for the
three months ended September 30,
2016, compared to a Net Loss, As Adjusted of $164.6 million, or $0.72 per share (basic and diluted), for the
comparable 2015 period.
For the nine months ended September 30,
2016, Cheniere reported a net loss of $719.7 million, or $3.15 per share (basic and diluted), compared to
a net loss of $684.0 million, or
$3.02 per share (basic and diluted),
for the comparable 2015 period. For the nine months ended
September 30, 2016, Net Loss, As
Adjusted was $369.1 million, or
$1.62 per share (basic and diluted),
compared to a Net Loss, As Adjusted of $498.5 million, or $2.20 per share (basic and diluted), for the
comparable 2015 period.
For the three and nine months ended September 30, 2016, Net Loss, As Adjusted
excludes the impact of changes in the fair value of our interest
rate, commodity and FX derivatives, loss on early extinguishment of
debt, restructuring expense, amortization of the beneficial
conversion feature related to certain Class B units of Cheniere
Energy Partners, L.P. ("Cheniere Partners") (NYSE MKT: CQP) and
impairment expense. Loss on early extinguishment of debt was
associated with the write-off of debt issuance costs by Sabine Pass
Liquefaction, LLC ("SPL") and Cheniere Corpus Christi Holdings, LLC
("CCH") in connection with the refinancing of a portion of their
credit facilities and by Cheniere Creole Trail Pipeline, L.P. as a
result of the prepayment of its outstanding term loan. For the
three and nine months ended September 30,
2015, Net Loss, As Adjusted excludes the impact of changes
in the fair value of interest rate, commodity and FX derivatives,
loss on early extinguishment of debt related to the write-off of
debt issuance costs by SPL primarily in connection with the
refinancing of a portion of its credit facilities in March 2015, amortization of the beneficial
conversion feature and impairment expense.
"The third quarter of 2016 was significant for Cheniere on
multiple fronts. Our transition to operations continues,
highlighted in the third quarter by the substantial completion of
Train 2 at Sabine Pass and the
generation of approximately $67
million in Adjusted EBITDA2. Commissioning
activities commenced on Train 3, and our remaining Trains under
construction continue on time and on budget," said Jack Fusco, Cheniere's President and CEO. "In
addition, we continued to manage our debt maturity profile by
successfully issuing bonds to prepay outstanding borrowings under
credit facilities for the Sabine
Pass liquefaction project, with the issuing entity having
earned its first investment-grade credit rating during the
quarter."
Third Quarter 2016 Highlights
- In September 2016, Cheniere
Partners announced that Train 2 of the Sabine Pass Liquefaction
Project (defined below) achieved substantial completion.
- In September 2016, commissioning
activities commenced on Train 3 of the Sabine Pass Liquefaction
Project.
- In September 2016, Cheniere
announced the formation of a new executive leadership team.
- In September 2016, SPL issued an
aggregate principal amount of $1.5
billion of 5.00% Senior Secured Notes due 2027. Net proceeds
from the offering were used to prepay all of the principal amounts
outstanding under SPL's credit facilities and are being used to pay
a portion of the capital costs in connection with the construction
of the Sabine Pass Liquefaction Project.
- In September 2016, Cheniere
submitted a proposal to the board of directors of Cheniere Energy
Partners LP Holdings, LLC ("Cheniere Partners Holdings") (NYSE MKT:
CQH) to acquire the publicly held shares of Cheniere Partners
Holdings not already owned by Cheniere in a stock for stock
exchange.
Third Quarter and Year to Date 2016 Results
Our
financial results are reported on a consolidated basis. Our
ownership interest in Cheniere Partners consists of
100% ownership of the general partner of Cheniere Partners
and 80.1% ownership interest in Cheniere Partners
Holdings which owns a 55.9% limited partner interest in
Cheniere Partners.
Adjusted EBITDA for the three and nine months ended September 30, 2016 was $67.3 million and $19.4
million, respectively, compared to losses of $51.5 million and $138.0
million, respectively, for the comparable 2015 periods.
During the three months ended September 30,
2016, Train 2 of the Sabine Pass Liquefaction Project
achieved substantial completion. Prior to substantial completion,
amounts received from the sale of commissioning cargoes were offset
against LNG terminal construction-in-process because these amounts
were earned during the testing phase for the construction of Trains
1 and 2 of the Sabine Pass Liquefaction Project. We expect sales of
LNG cargoes from future liquefaction trains ("Trains") to be
reported in the same manner. During the three months ended
September 30, 2016, a total of 18
cargoes were loaded and exported from the Sabine Pass Liquefaction
Project, 3 of which were Train 2 commissioning cargoes.
Total operating costs and expenses increased $332.3 million and $452.7
million during the three and nine months ended September 30, 2016 compared to the three and nine
months ended September 30, 2015,
respectively, generally as a result of the commencement of
operations of Train 1 and Train 2 of the Sabine Pass Liquefaction
Project in May and September 2016,
respectively. Depreciation and amortization expense increased
during the three and nine months ended September 30, 2016 as we began depreciation of
our assets related to Train 1 and Train 2 of the Sabine Pass
Liquefaction Project upon reaching substantial completion. Selling,
general and administrative expense during the three and nine months
ended September 30, 2016 decreased
from the comparable 2015 periods, which was primarily due to the
timing of share-based compensation recognition and the recognition
of certain employee-related costs within restructuring expense
during the three and nine months ended September 30, 2016 historically reported in
selling, general and administrative expense, a reduction in certain
professional services fees, and reallocation of costs from selling,
general and administrative activities to operating and maintenance
activities following commencement of operations at the Sabine Pass
Liquefaction Project.
As a result of restructuring efforts initiated in 2015, we
recorded $26.2 million and
$49.2 million of restructuring
charges and other costs associated with restructuring and
operational efficiency initiatives during the three and nine months
ended September 30, 2016,
respectively, for which the majority of these charges required, or
will require, cash expenditure. Included in these amounts are
$20.9 million and $42.9 million for share-based compensation. All
charges were recorded within restructuring expense on our
Consolidated Statements of Operations and substantially all related
to severance and other employee-related costs.
Included in selling, general and administrative expense were
share-based compensation expenses of $7.5
million and $31.2 million for
the three and nine months ended September
30, 2016, respectively, compared to $27.1 million and $85.2
million for the comparable 2015 periods, respectively.
Liquefaction Projects Update
Sabine Pass
Liquefaction Project
Through Cheniere Partners, we are
developing up to six Trains, each with an expected nominal
production capacity of approximately 4.5 million tonnes per annum
("mtpa") of LNG, at the Sabine Pass LNG terminal adjacent to the
existing regasification facilities (the "Sabine Pass Liquefaction
Project").
The Trains are in various stages of operation, construction, and
development.
- Construction on Trains 1 and 2 began in August 2012 and substantial completion was
achieved in May 2016 and September 2016, respectively. Substantial
completion is achieved upon the completion of construction,
commissioning and the satisfaction of certain tests.
- Construction on Trains 3 and 4 began in May 2013, and as of September 30, 2016, the overall project
completion percentage for Trains 3 and 4 was approximately 91.8%,
which is ahead of the contractual schedule. In September 2016, commissioning activities
commenced on Train 3. Based on the current construction schedule,
Cheniere Partners expects Trains 3 and 4 to reach substantial
completion in 2017.
- Construction on Train 5 began in June
2015, and as of September 30,
2016, the overall project completion percentage for Train 5
was approximately 42.8%, which is ahead of the contractual
schedule. Engineering, procurement, subcontract work and
construction were approximately 90.8%, 62.0%, 41.9% and 4.6%
complete, respectively. Based on the current construction schedule,
Cheniere Partners expects Train 5 to reach substantial completion
in 2019.
- Train 6 is currently under development, with all necessary
regulatory approvals in place. Cheniere Partners expects to make a
final investment decision and commence construction on Train 6
upon, among other things, entering into an engineering,
procurement, and construction contract, entering into acceptable
commercial arrangements, and obtaining adequate financing.
|
Sabine Pass
Liquefaction Project
|
Liquefaction
Train
|
Train
1
|
Train
2
|
Trains
3-4
|
Train
5
|
Project
Status
|
Operational
|
Operational
|
92% Overall
Completion
|
43% Overall
Completion
|
Expected Substantial
Completion
|
-
|
-
|
2017
|
2019
|
Corpus Christi LNG Terminal
We are developing
up to three Trains, each with an expected nominal production
capacity of approximately 4.5 mtpa of LNG, near Corpus Christi, Texas (the "CCL Project").
The Trains are in various stages of construction and
development:
- Construction on Trains 1 and 2 began in May 2015, and as of September 30, 2016, the overall project
completion percentage for Trains 1 and 2 was approximately 43.0%,
which is ahead of the contractual schedule. Engineering,
procurement and construction were approximately 99.3%, 59.0% and
14.4% complete, respectively. Based on the current construction
schedule, we expect Trains 1 and 2 to reach substantial completion
in 2019.
- Train 3 is under development, with all necessary regulatory
approvals in place. We have entered into an LNG Sale and Purchase
Agreement ("SPA") for approximately 0.8 mtpa of LNG volumes that
commence with Train 3 and expect to commence construction upon
entering into additional SPAs and obtaining adequate
financing.
Additionally, we are developing Trains 4 and 5 adjacent to the
CCL Project and have initiated the regulatory approval process with
respect to those Trains.
|
Corpus Christi LNG
Terminal
|
Liquefaction
Train
|
Trains
1-2
|
Project
Status
|
43% Overall
Completion
|
Expected Substantial
Completion
|
2019
|
Recent Developments
- In October 2016, the previously
announced planned outage to improve performance of the flare
systems at the Sabine Pass Liquefaction Project, as well as to
perform scheduled maintenance to Train 1 and other facilities, was
completed on schedule and budget.
- Cheniere is exploring the development of a midscale
liquefaction project (the "Midscale Liquefaction Project"). The
Midscale Liquefaction Project would be developed using electric
drive modular Trains, with an expected aggregate nominal production
capacity of approximately 9.5 mtpa of LNG. Cheniere has completed a
competitive bidding process and awarded a front-end engineering and
design contract to a consortium consisting of KBR, Inc., Siemens
AG, and Chart Industries, Inc.
- Cheniere has proposed the development of the Midcontinent
Supply Header Interstate Pipeline ("MIDSHIP"), connecting new gas
production in the Anadarko Basin to Gulf Coast markets. MIDSHIP is
being contemplated for up to 1.4 Bcf/d of capacity and would
facilitate gas supply for both the Sabine Pass Liquefaction Project
and the CCL Project. Cheniere expects the regulatory pre-filing
process to commence imminently and to file formal applications for
the required regulatory permits in 2017, with construction expected
to commence in 2018 upon, among other things, entering into a
construction contract and acceptable commercial arrangements and
obtaining adequate financing to construct the pipeline.
- In October 2016, Sabine Pass LNG,
L.P. ("SPLNG") issued a notice of redemption to redeem all of its
outstanding $420 million in aggregate
principal amount of 6.50% Senior Secured Notes due 2020 (the "2020
Notes") on November 30, 2016 (the
"Redemption Date"). Concurrently, SPLNG intends to repay all of its
outstanding $1,665.0 million in
aggregate principal amount of 7.50% Senior Secured Notes due 2016
(the "2016 Notes"), which mature on the Redemption Date. Subsequent
to the redemption of the 2020 Notes and the repayment of the 2016
Notes, there will be no debt maturity in the Cheniere complex until
2020.
Investor Conference Call and Webcast
We will host a
conference call to discuss our financial and operating results for
the third quarter on Thursday, November 3,
2016, at 11 a.m. Eastern time
/ 10 a.m. Central time. A listen-only
webcast of the call and an accompanying slide presentation may be
accessed through our website at www.cheniere.com. Following the
call, an archived recording will be made available on our
website.
1 Reported as Net loss attributable to common
stockholders on our Consolidated Statements of Operations.
2 Non-GAAP financial measure. See "Reconciliation
of Non-GAAP Measures" for further details.
About Cheniere
Cheniere Energy, Inc., a Houston-based energy company primarily engaged
in LNG-related businesses, owns and operates the Sabine Pass LNG
terminal in Louisiana. Directly
and through its subsidiary, Cheniere Energy Partners, L.P.,
Cheniere is developing, constructing, and operating liquefaction
projects near Corpus Christi,
Texas and at the Sabine Pass LNG terminal, respectively.
Cheniere is also exploring a limited number of opportunities
directly related to its existing LNG business.
For additional information, please refer to the Cheniere website
at www.cheniere.com and Quarterly Report on Form 10-Q for the
quarter ended September 30, 2016, filed with the Securities
and Exchange Commission.
Forward-Looking Statements
This press release contains
certain statements that may include "forward-looking statements"
within the meanings of Section 27A of the Securities Act of 1933
and Section 21E of the Securities Exchange Act of 1934. All
statements, other than statements of historical fact, included
herein are "forward-looking statements." Included among
"forward-looking statements" are, among other things, (i)
statements regarding Cheniere's business strategy, plans and
objectives, including the development, construction and operation
of liquefaction facilities, (ii) statements regarding expectations
regarding regulatory authorizations and approvals, (iii) statements
expressing beliefs and expectations regarding the development of
Cheniere's LNG terminal and pipeline businesses, including
liquefaction facilities, (iv) statements regarding the business
operations and prospects of third parties, (v) statements regarding
potential financing arrangements and (vi) statements regarding
future discussions and entry into contracts. Furthermore, in
connection with our proposal to Cheniere Partners Holdings, there
can be no assurance that any discussions that may occur between us
and Cheniere Partners Holdings will result in the entry into of a
definitive agreement concerning a transaction or, if such a
definitive agreement is reached, will result in the consummation of
a transaction provided for in such definitive agreement. Although
Cheniere believes that the expectations reflected in these
forward-looking statements are reasonable, they do involve
assumptions, risks and uncertainties, and these expectations may
prove to be incorrect. Cheniere's actual results could differ
materially from those anticipated in these forward-looking
statements as a result of a variety of factors, including those
discussed in Cheniere's periodic reports that are filed with and
available from the Securities and Exchange Commission. You should
not place undue reliance on these forward-looking statements, which
speak only as of the date of this press release. Other than as
required under the securities laws, Cheniere does not assume a duty
to update these forward-looking statements.
(Financial Table Follows)
Cheniere Energy,
Inc.
|
Consolidated
Statements of Operations
|
(in thousands,
except per share data)(1)
|
(unaudited)
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Revenues
|
|
|
|
|
|
|
|
Regasification
revenues
|
$
|
66,970
|
|
|
$
|
66,597
|
|
|
$
|
198,143
|
|
|
$
|
199,888
|
|
LNG revenues
(losses)
|
398,554
|
|
|
(1,557)
|
|
|
511,993
|
|
|
(1,601)
|
|
Other
revenues
|
149
|
|
|
1,019
|
|
|
1,445
|
|
|
4,166
|
|
Total
revenues
|
465,673
|
|
|
66,059
|
|
|
711,581
|
|
|
202,453
|
|
|
|
|
|
|
|
|
|
Operating costs and
expenses
|
|
|
|
|
|
|
|
Cost (cost recovery)
of sales (excluding depreciation and amortization expense shown
separately below)
|
252,343
|
|
|
(24,214)
|
|
|
352,559
|
|
|
(22,077)
|
|
Operating and
maintenance expense
|
61,610
|
|
|
17,963
|
|
|
143,489
|
|
|
71,396
|
|
Development
expense
|
1,546
|
|
|
4,935
|
|
|
4,709
|
|
|
37,640
|
|
Selling, general and
administrative expense
|
59,418
|
|
|
97,332
|
|
|
196,999
|
|
|
263,205
|
|
Depreciation and
amortization expense
|
49,212
|
|
|
21,638
|
|
|
106,082
|
|
|
59,561
|
|
Restructuring
expense
|
26,241
|
|
|
—
|
|
|
49,196
|
|
|
—
|
|
Impairment
expense
|
—
|
|
|
396
|
|
|
10,095
|
|
|
572
|
|
Other
|
27
|
|
|
83
|
|
|
189
|
|
|
348
|
|
Total operating costs
and expenses
|
450,397
|
|
|
118,133
|
|
|
863,318
|
|
|
410,645
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
15,276
|
|
|
(52,074)
|
|
|
(151,737)
|
|
|
(208,192)
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
Interest expense, net
of capitalized interest
|
(148,053)
|
|
|
(93,566)
|
|
|
(330,357)
|
|
|
(238,664)
|
|
Loss on early
extinguishment of debt
|
(25,765)
|
|
|
—
|
|
|
(82,537)
|
|
|
(96,273)
|
|
Derivative gain
(loss), net
|
29,327
|
|
|
(161,482)
|
|
|
(242,228)
|
|
|
(242,123)
|
|
Other income
(expense)
|
437
|
|
|
(39)
|
|
|
(5,564)
|
|
|
616
|
|
Total other
expense
|
(144,054)
|
|
|
(255,087)
|
|
|
(660,686)
|
|
|
(576,444)
|
|
|
|
|
|
|
|
|
|
Loss before income
taxes and non-controlling interest
|
(128,778)
|
|
|
(307,161)
|
|
|
(812,423)
|
|
|
(784,636)
|
|
Income tax benefit
(provision)
|
(1,638)
|
|
|
69
|
|
|
(1,911)
|
|
|
(102)
|
|
Net loss
|
(130,416)
|
|
|
(307,092)
|
|
|
(814,334)
|
|
|
(784,738)
|
|
Less: net loss
attributable to non-controlling interest
|
(29,974)
|
|
|
(9,284)
|
|
|
(94,636)
|
|
|
(100,726)
|
|
Net loss attributable
to common stockholders
|
$
|
(100,442)
|
|
|
$
|
(297,808)
|
|
|
$
|
(719,698)
|
|
|
$
|
(684,012)
|
|
|
|
|
|
|
|
|
|
Net loss per share
attributable to common stockholders—basic and diluted
|
$
|
(0.44)
|
|
|
$
|
(1.31)
|
|
|
$
|
(3.15)
|
|
|
$
|
(3.02)
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding—basic and diluted
|
228,924
|
|
|
227,126
|
|
|
228,463
|
|
|
226,648
|
|
(1)
|
Please refer to the
Cheniere Energy, Inc. Quarterly Report on Form 10-Q for the quarter
ended September 30, 2016, filed with the Securities and
Exchange Commission.
|
Cheniere Energy,
Inc.
|
Consolidated
Balance Sheets
|
(in thousands,
except share data)(1)
|
|
|
September
30,
|
|
December
31,
|
|
2016
|
|
2015
|
ASSETS
|
(unaudited)
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
|
990,132
|
|
|
$
|
1,201,112
|
|
Restricted
cash
|
827,545
|
|
|
503,397
|
|
Accounts and other
receivables
|
154,167
|
|
|
5,749
|
|
Inventory
|
63,853
|
|
|
18,125
|
|
Other current
assets
|
69,030
|
|
|
54,203
|
|
Total current
assets
|
2,104,727
|
|
|
1,782,586
|
|
|
|
|
|
Non-current
restricted cash
|
31,128
|
|
|
31,722
|
|
Property, plant and
equipment, net
|
19,891,666
|
|
|
16,193,907
|
|
Debt issuance costs,
net
|
294,059
|
|
|
378,677
|
|
Non-current
derivative assets
|
11,247
|
|
|
30,887
|
|
Goodwill
|
76,819
|
|
|
76,819
|
|
Other non-current
assets
|
279,434
|
|
|
314,455
|
|
Total
assets
|
$
|
22,689,080
|
|
|
$
|
18,809,053
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities
|
|
|
|
Accounts
payable
|
$
|
38,569
|
|
|
$
|
22,820
|
|
Accrued
liabilities
|
699,996
|
|
|
427,199
|
|
Current debt,
net
|
1,781,511
|
|
|
1,673,379
|
|
Deferred
revenue
|
26,709
|
|
|
26,669
|
|
Derivative
liabilities
|
61,829
|
|
|
35,201
|
|
Other current
liabilities
|
264
|
|
|
—
|
|
Total current
liabilities
|
2,608,878
|
|
|
2,185,268
|
|
|
|
|
|
Long-term debt,
net
|
19,033,513
|
|
|
14,920,427
|
|
Non-current deferred
revenue
|
6,500
|
|
|
9,500
|
|
Non-current
derivative liabilities
|
268,601
|
|
|
79,387
|
|
Other non-current
liabilities
|
65,849
|
|
|
53,068
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
Stockholders'
equity
|
|
|
|
Preferred stock,
$0.0001 par value, 5.0 million shares authorized, none
issued
|
—
|
|
|
—
|
|
Common stock, $0.003
par value
|
|
|
|
Authorized: 480.0
million shares at September 30, 2016 and December 31,
2015
|
|
|
|
Issued and
outstanding: 235.1 million shares and 235.6 million shares at
September 30, 2016 and December 31, 2015, respectively
|
705
|
|
|
708
|
|
Treasury stock: 12.1
million shares and 11.6 million shares at September 30, 2016 and
December 31, 2015, respectively, at cost
|
(372,531)
|
|
|
(353,927)
|
|
Additional
paid-in-capital
|
3,112,753
|
|
|
3,075,317
|
|
Accumulated
deficit
|
(4,343,646)
|
|
|
(3,623,948)
|
|
Total stockholders'
deficit
|
(1,602,719)
|
|
|
(901,850)
|
|
Non-controlling
interest
|
2,308,458
|
|
|
2,463,253
|
|
Total
equity
|
705,739
|
|
|
1,561,403
|
|
Total liabilities and
equity
|
$
|
22,689,080
|
|
|
$
|
18,809,053
|
|
(1)
|
Please refer to the
Cheniere Energy, Inc. Quarterly Report on Form 10-Q for the quarter
ended September 30, 2016, filed with the Securities and
Exchange Commission.
|
As of September 30, 2016, we had cash and cash equivalents
of $990.1 million available to
Cheniere. In addition, we had current and non-current restricted
cash of $858.7 million (which
included current and non-current restricted cash available to us
and our subsidiaries) designated for the following purposes:
$192.8 million for the CCL Project,
$325.6 million for the Sabine Pass
Liquefaction Project, $127.5 million
for restricted purposes under the terms of Cheniere Partners'
credit facilities, $129.1 million for
interest payments related to the Sabine Pass LNG, L.P. senior
secured notes and $83.7 million for
other restricted purposes.
Reconciliation of Non-GAAP Measures
Regulation G Reconciliations
In addition to disclosing financial results in accordance with
U.S. GAAP, the accompanying news release contains non-GAAP
financial measures. Adjusted EBITDA, Net Loss, As Adjusted and Net
Loss per share, As Adjusted are non-GAAP financial measures that we
use to facilitate comparisons of operating performance across
periods. These non-GAAP measures should be viewed as a supplement
to and not a substitute for our U.S. GAAP measures of performance
and the financial results calculated in accordance with U.S. GAAP
and reconciliations from these results should be carefully
evaluated.
Adjusted EBITDA represents net loss attributable to Cheniere
before net loss attributable to the non-controlling interest,
interest, taxes, depreciation and amortization, adjusted for
certain non-cash items, other non-operating income or expense
items, and other items not otherwise predictive or indicative of
ongoing operating performance, as detailed in the following
reconciliation. Adjusted EBITDA is not intended to represent cash
flows from operations or net loss as defined by U.S. GAAP and is
not necessarily comparable to similarly titled measures reported by
other companies.
We believe Adjusted EBITDA provides relevant and useful
information to management, investors and other users of our
financial information in evaluating the effectiveness of our
operating performance in a manner that is consistent with
management's evaluation of business performance. We believe
Adjusted EBITDA is widely used by investors to measure a company's
operating performance without regard to items such as interest
expense, taxes, depreciation and amortization which vary
substantially from company to company depending on capital
structure, the method by which assets were acquired and
depreciation policies. Further, the exclusion of certain non-cash
items, other non-operating income or expense items, and items not
otherwise predictive or indicative of ongoing operating performance
enables comparability to prior period performance and trend
analysis.
Adjusted EBITDA is calculated by taking net loss attributable to
common stockholders before net loss attributable to non-controlling
interest, interest expense, net of capitalized interest, changes in
the fair value and settlement of our interest rate derivatives,
taxes, depreciation and amortization, and adjusting for the effects
of certain non-cash items, other non-operating income or expense
items, and other items not otherwise predictive or indicative of
ongoing operating performance, including the effects of
modification or extinguishment of debt, impairment expense, changes
in the fair value of our commodity and foreign currency exchange
("FX") derivatives and non-cash compensation expense. We believe
the exclusion of these items enables investors and other users of
our financial information to assess our sequential and
year-over-year performance and operating trends on a more
comparable basis and is consistent with management's own evaluation
of performance.
Net Loss, As Adjusted represents net loss attributable to common
stockholders and Net Loss per share, As Adjusted represents
Cheniere's basic and diluted earnings per share, in each case
adjusted for certain non-cash items, other non-operating
income or expense items and other items not otherwise predictive or
indicative of ongoing operating performance, net of the portion
attributable to non-controlling interests, including changes in the
fair value of our interest rate, commodity and FX derivatives, the
effects of modifications or extinguishments of debt, amortization
of the beneficial conversion feature of certain CQP Class B units,
costs related to restructuring activities, and impairment expense.
Net Loss, As Adjusted and Net Loss per share, As Adjusted are
presented because we believe they are useful tools for assessing
the operating performance of Cheniere. Net Loss, As Adjusted and
Net Loss per share, As Adjusted are not intended to represent net
loss attributable to common stockholders and net loss per share
attributable to common stockholders, the most comparable U.S. GAAP
measures, respectively, as indicators of operating performance, and
are not necessarily comparable to measures reported by other
companies.
Adjusted EBITDA
The following table reconciles our Adjusted EBITDA to U.S. GAAP
results for the three and nine months ended September 30, 2016 and 2015 (in thousands):
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Net loss attributable
to common stockholders
|
$
|
(100,442)
|
|
|
$
|
(297,808)
|
|
|
$
|
(719,698)
|
|
|
$
|
(684,012)
|
|
Net loss attributable
to non-controlling interest
|
(29,974)
|
|
|
(9,284)
|
|
|
(94,636)
|
|
|
(100,726)
|
|
Income tax provision
(benefit)
|
1,638
|
|
|
(69)
|
|
|
1,911
|
|
|
102
|
|
Interest expense, net
of capitalized interest
|
148,053
|
|
|
93,566
|
|
|
330,357
|
|
|
238,664
|
|
Loss on early
extinguishment of debt
|
25,765
|
|
|
—
|
|
|
82,537
|
|
|
96,273
|
|
Derivative loss
(gain), net
|
(29,327)
|
|
|
161,482
|
|
|
242,228
|
|
|
242,123
|
|
Other expense
(income)
|
(437)
|
|
|
39
|
|
|
5,564
|
|
|
(616)
|
|
Income (loss) from
operations
|
$
|
15,276
|
|
|
$
|
(52,074)
|
|
|
$
|
(151,737)
|
|
|
$
|
(208,192)
|
|
Adjustments to
reconcile loss from operations to Adjusted EBITDA:
|
|
|
|
|
|
|
|
Depreciation and
amortization expense
|
49,212
|
|
|
21,638
|
|
|
106,082
|
|
|
59,561
|
|
Loss (gain) from
changes in fair value of commodity and FX derivatives,
net
|
(2,784)
|
|
|
(32,658)
|
|
|
22,918
|
|
|
(32,195)
|
|
Total non-cash
compensation expense
|
5,551
|
|
|
11,214
|
|
|
32,015
|
|
|
42,274
|
|
Impairment
expense
|
—
|
|
|
396
|
|
|
10,095
|
|
|
572
|
|
Adjusted
EBITDA
|
$
|
67,255
|
|
|
$
|
(51,484)
|
|
|
$
|
19,373
|
|
|
$
|
(137,980)
|
|
Net Loss, As Adjusted and Net Loss per share, As
Adjusted
The following tables reconcile our Net Loss, As Adjusted and Net
Loss per share, As Adjusted to U.S. GAAP results for the three and
nine months ended September 30, 2016
and 2015 (in thousands, except per share data):
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Net loss attributable
to common stockholders
|
$
|
(100,442)
|
|
|
$
|
(297,808)
|
|
|
$
|
(719,698)
|
|
|
$
|
(684,012)
|
|
Add:
|
|
|
|
|
|
|
|
Restructuring
expense
|
26,241
|
|
|
—
|
|
|
49,196
|
|
|
—
|
|
Impairment
expense
|
—
|
|
|
396
|
|
|
10,095
|
|
|
572
|
|
Loss on early
extinguishment of debt
|
25,765
|
|
|
—
|
|
|
82,537
|
|
|
96,273
|
|
Loss (gain) from
changes in fair value of interest rate derivatives, net
|
(41,503)
|
|
|
155,993
|
|
|
211,914
|
|
|
146,794
|
|
Loss (gain) from
changes in fair value of commodity and FX derivatives,
net
|
(2,784)
|
|
|
(32,658)
|
|
|
22,918
|
|
|
(32,195)
|
|
Amortization of
beneficial conversion feature allocated to Class B units of CQP not
owned by Cheniere
|
6,819
|
|
|
46
|
|
|
9,322
|
|
|
63
|
|
Less:
|
|
|
|
|
|
|
|
Adjustments
attributable to non-controlling interest
|
8,312
|
|
|
(9,421)
|
|
|
35,366
|
|
|
25,970
|
|
|
|
|
|
|
|
|
|
Net Loss, As
Adjusted
|
$
|
(94,216)
|
|
|
$
|
(164,610)
|
|
|
$
|
(369,082)
|
|
|
$
|
(498,475)
|
|
|
|
|
|
|
|
|
|
Net loss per share
attributable to common stockholders—basic and diluted
|
$
|
(0.44)
|
|
|
$
|
(1.31)
|
|
|
$
|
(3.15)
|
|
|
$
|
(3.02)
|
|
Add:
|
|
|
|
|
|
|
|
Restructuring
expense
|
0.11
|
|
|
—
|
|
|
0.22
|
|
|
—
|
|
Impairment
expense
|
—
|
|
|
—
|
|
|
0.04
|
|
|
—
|
|
Loss on early
extinguishment of debt
|
0.11
|
|
|
—
|
|
|
0.36
|
|
|
0.42
|
|
Loss (gain) from
changes in fair value of interest rate derivatives, net
|
(0.18)
|
|
|
0.69
|
|
|
0.93
|
|
|
0.65
|
|
Loss (gain) from
changes in fair value of commodity and FX derivatives,
net
|
(0.01)
|
|
|
(0.14)
|
|
|
0.10
|
|
|
(0.14)
|
|
Amortization of
beneficial conversion feature allocated to Class B units of CQP not
owned by Cheniere
|
0.03
|
|
|
—
|
|
|
0.04
|
|
|
—
|
|
Less:
|
|
|
|
|
|
|
|
Adjustments
attributable to non-controlling interest
|
0.04
|
|
|
(0.04)
|
|
|
0.15
|
|
|
0.11
|
|
Net Loss per share,
As Adjusted—basic and diluted(1)
|
$
|
(0.41)
|
|
|
$
|
(0.72)
|
|
|
$
|
(1.62)
|
|
|
$
|
(2.20)
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding—basic and diluted
|
228,924
|
|
|
227,126
|
|
|
228,463
|
|
|
226,648
|
|
(1)
|
Numbers may not foot
due to rounding.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/cheniere-energy-inc-reports-third-quarter-2016-results-300356741.html
SOURCE Cheniere Energy, Inc.