Cheniere Energy Partners, L.P. (NYSE American: CQP):
Summary of First Quarter 2018 Results
(in millions, except LNG data)
Three Months Ended
March 31, 2018 2017 Revenues $
1,593 $ 891 Net income $ 335 $ 47 Adjusted EBITDA1 $ 659 $ 319 LNG
exported: Number of cargoes 67 43 Volumes (TBtu) 244 152 LNG
volumes loaded (TBtu) 241 154
Revised 2018 Full Year Distribution
Guidance
Previous Revised Distribution per Unit $ 2.00 - $ 2.20 $
2.20 - $ 2.30
Recent Achievements
Operational
- As of April 30, approximately 90
cargoes have been produced, loaded, and exported from the SPL
Project (defined below) in 2018. To date, approximately 350
cumulative LNG cargoes have been exported from the SPL Project,
with deliveries to 26 countries and regions worldwide.
Financial
- In March 2018, the date of first
commercial delivery (“DFCD”) was reached under the 20-year LNG Sale
and Purchase Agreement (“SPA”) with GAIL (India) Limited relating
to Train 4 of the SPL Project.
Liquefaction Project Update
SPL Project Liquefaction
Train Trains 1-4
Train 5
Train 6 Project Status Operational
Under Construction Permitted
Expected Substantial Completion Complete 1H 2019 — Expected DFCD
Window Start Complete 2H 2019 —
Cheniere Energy Partners, L.P. (“Cheniere Partners”) (NYSE
American: CQP) reported net income of $335 million for the three
months ended March 31, 2018, compared to net income of $47 million
for the comparable period in 2017. The increase in net income was
primarily due to increased income from operations as a result of
additional natural gas liquefaction trains (“Trains”) in operation
at the SPL Project, partially offset by increased interest expense,
net of amounts capitalized.
Adjusted EBITDA1 for the three months ended March 31, 2018 was
$659 million, compared to $319 million for the comparable 2017
period. The increase in Adjusted EBITDA was primarily due to
increased income from operations.
Total revenues increased $702 million during the three months
ended March 31, 2018 as compared to the three months ended March
31, 2017. Total operating costs and expenses increased $413 million
during the three months ended March 31, 2018, compared to the three
months ended March 31, 2017. The increases in revenues and total
operating costs and expenses for the three months ended March 31,
2018, as compared to the comparable prior year period, were
primarily driven by the timing of completion of Trains at the SPL
Project and the length of each Train’s operations within the
periods being compared.
During the three months ended March 31, 2018, 67 LNG cargoes
were exported from the SPL Project, none of which were
commissioning cargoes.
SPL Project
Through Cheniere Partners, we are developing up to six Trains at
the Sabine Pass LNG terminal adjacent to the existing
regasification facilities (the “SPL Project”). Each Train is
expected to have a nominal production capacity, which is prior to
adjusting for planned maintenance, production reliability, and
potential overdesign, of approximately 4.5 million tonnes per annum
(“mtpa”) of LNG and an adjusted nominal production capacity of
approximately 4.3 to 4.6 mtpa of LNG. Trains 1 through 4 are
operational, Train 5 is under construction, and Train 6 is being
commercialized and has all necessary regulatory approvals in
place.
Distributions to
Unitholders
We will pay a cash distribution per common and subordinated unit
of $0.55 to unitholders of record as of May 7, 2018 and the
related general partner distribution on May 15, 2018.
Investor Conference Call and
Webcast
Cheniere Energy, Inc. will host a conference call to discuss its
financial and operating results for the first quarter on Friday,
May 4, 2018, at 10 a.m. Eastern time / 9 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. The call and accompanying slide
presentation may include financial and operating results or other
information regarding Cheniere Partners.
___________________
(1)
Non-GAAP financial measure. See
“Reconciliation of Non-GAAP Measures” for further details.
About Cheniere Partners
Cheniere Partners, through its subsidiary, Sabine Pass
Liquefaction, LLC (“SPL”), is developing, constructing, and
operating natural gas liquefaction facilities at the Sabine Pass
LNG terminal located in Cameron Parish, Louisiana, on the
Sabine-Neches Waterway less than four miles from the Gulf Coast.
Cheniere Partners, through SPL, plans to construct up to six
liquefaction trains (“Trains”), which are in various stages of
development, construction, and operations. Trains 1 through 4 are
operational, Train 5 is under construction and Train 6 is being
commercialized and has all necessary regulatory approvals in place.
Each Train is expected to have a nominal production capacity, which
is prior to adjusting for planned maintenance, production
reliability, and potential overdesign, of approximately 4.5 mtpa of
LNG and an adjusted nominal production capacity of approximately
4.3 to 4.6 mtpa of LNG.
Through its wholly owned subsidiary, Sabine Pass LNG, L.P.,
Cheniere Partners owns and operates regasification facilities at
the Sabine Pass LNG terminal, which includes pre-existing
infrastructure of five LNG storage tanks with aggregate capacity of
approximately 16.9 billion cubic feet equivalent (“Bcfe”), two
marine berths that can each accommodate vessels with nominal
capacity of up to 266,000 cubic meters and vaporizers with
regasification capacity of approximately 4.0 Bcf/d. Cheniere
Partners also owns a 94-mile pipeline that interconnects the Sabine
Pass LNG terminal with a number of large interstate pipelines
through its wholly owned subsidiary, Cheniere Creole Trail
Pipeline, L.P.
For additional information, please refer to the Cheniere
Partners website at www.cheniere.com and Quarterly Report on Form
10-Q for the quarter ended March 31, 2018, filed with the
Securities and Exchange Commission.
Forward-Looking Statements
This press release contains certain statements that may include
“forward-looking statements.” All statements, other than statements
of historical or present facts or conditions, included herein are
“forward-looking statements.” Included among “forward-looking
statements” are, among other things, (i) statements regarding
Cheniere Partners’ 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 Partners’ LNG terminal and liquefaction business, (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. Although Cheniere Partners 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
Partners’ 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 Partners’
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 Partners does not assume a duty to update
these forward-looking statements.
(Financial Tables Follow)
Cheniere Energy Partners, L.P.
Consolidated Statements of
Income
(in millions, except per unit data)
(1)
(unaudited)
Three Months Ended March 31, 2018
2017 Revenues LNG revenues $ 1,015 $ 492 LNG
revenues—affiliate 503 331 Regasification revenues 65 65 Other
revenues 10 2 Other revenues—affiliate — 1 Total
revenues 1,593 891 Operating costs and expenses Cost of
sales (excluding depreciation and amortization expense shown
separately below) 837 513 Operating and maintenance expense 95 50
Operating and maintenance expense—affiliate 26 18 General and
administrative expense 4 3 General and administrative
expense—affiliate 18 22 Depreciation and amortization expense 105
66 Total operating costs and expenses 1,085
672 Income from operations 508 219 Other
income (expense) Interest expense, net of capitalized interest (185
) (130 ) Loss on early extinguishment of debt — (42 ) Derivative
gain, net 8 — Other income 4 — Total other expense
(173 ) (172 ) Net income $ 335 $ 47
Basic and diluted net income (loss) per common unit $ 0.67 $
(0.80 ) Weighted average number of common units outstanding
used for basic and diluted net income (loss) per common unit
calculation 348.6 57.1
_______________________
(1)
Please refer to the Cheniere Energy
Partners, L.P. Quarterly Report on Form 10-Q for the quarter ended
March 31, 2018, filed with the Securities and Exchange
Commission.
Cheniere Energy Partners, L.P.
Consolidated Balance Sheets
(in millions, except unit data)
(1)
March 31, December 31, 2018 2017
ASSETS
(unaudited) Current assets Cash and cash equivalents
$ — $ — Restricted cash 1,477 1,589 Accounts and other receivables
240 191 Accounts receivable—affiliate 114 163 Advances to affiliate
97 36 Inventory 83 95 Other current assets 54 65
Total current assets 2,065 2,139 Property, plant and
equipment, net 15,145 15,139 Debt issuance costs, net 34 38
Non-current derivative assets 24 31 Other non-current assets, net
197 206 Total assets $ 17,465 $ 17,553
LIABILITIES AND PARTNERS’ EQUITY Current liabilities
Accounts payable $ 11 $ 12 Accrued liabilities 509 637 Due to
affiliates 30 68 Deferred revenue 95 111 Deferred revenue—affiliate
— 1 Derivative liabilities 4 — Total current
liabilities 649 829 Long-term debt, net 16,052 16,046
Non-current deferred revenue — 1 Non-current derivative liabilities
3 3 Other non-current liabilities 11 10 Other non-current
liabilities—affiliate 25 25 Partners’ equity Common
unitholders’ interest (348.6 million units issued and outstanding
at March 31, 2018 and December 31, 2017) 1,731 1,670 Subordinated
unitholders’ interest (135.4 million units issued and outstanding
at March 31, 2018 and December 31, 2017) (1,019 ) (1,043 ) General
partner’s interest (2% interest with 9.9 million units issued and
outstanding at March 31, 2018 and December 31, 2017) 13 12
Total partners’ equity 725 639 Total
liabilities and partners’ equity $ 17,465 $ 17,553
_______________________
(1)
Please refer to the Cheniere Energy
Partners, L.P. Quarterly Report on Form 10-Q for the quarter ended
March 31, 2018, filed with the Securities and Exchange
Commission.
Reconciliation of Non-GAAP Measures
Regulation G Reconciliation
In addition to disclosing financial results in accordance with
U.S. GAAP, the accompanying news release contains a non-GAAP
financial measure. Adjusted EBITDA is a non-GAAP financial measure
that is used to facilitate comparisons of operating performance
across periods. This non-GAAP measure 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 the reconciliation from these results should be
carefully evaluated.
Adjusted EBITDA is calculated by taking net income before
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 and changes in the fair value of our
commodity derivatives. Adjusted EBITDA is not intended to represent
cash flows from operations or net income (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. Management
believes 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 other items
not otherwise predictive or indicative of ongoing operating
performance enables comparability to prior period performance and
trend analysis.
Adjusted EBITDA
The following table reconciles our Adjusted EBITDA to U.S. GAAP
results for the three months ended March 31, 2018 and 2017 (in
millions):
Three Months Ended March 31,
2018 2017 Net income $ 335 $ 47
Interest expense, net of capitalized interest 185 130 Loss on early
extinguishment of debt — 42 Derivative gain, net (8 ) — Other
income (4 ) — Income from operations $ 508 $ 219 Adjustments
to reconcile income from operations to Adjusted EBITDA:
Depreciation and amortization expense 105 66 Loss from changes in
fair value of commodity derivatives, net 46 34 Adjusted
EBITDA $ 659 $ 319
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version on businesswire.com: https://www.businesswire.com/news/home/20180504005114/en/
Cheniere Energy Partners, L.P.InvestorsRandy Bhatia, 713-375-5479Megan Light,
713-375-5492orMediaEben
Burnham-Snyder, 713-375-5764
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