Evolve Transition Infrastructure LP (NYSE American: SNMP) (“Evolve”
or the “Partnership”) reports full year 2020 results and provides
strategy update.
FINANCIAL RESULTS
The Partnership’s full-year 2020 revenues
totaled $57.0 million, of which $45.5 million came from midstream
activities. The balance of the Partnership’s full-year 2020
revenues came from production activities. The activities of Carnero
G&P LLC, the Partnership’s midstream joint venture (the
“Carnero JV”) contributed a gain of approximately $4.5 million for
full-year 2020. The Partnership received total cash distributions
of $16.2 million from the Carnero JV for full-year 2020 activities.
The Partnership reported a net loss of $118.8 million for full-year
2020.
STRATEGY UPDATE
As the Partnership disclosed in its Annual
Report on Form 10-K for the year ended December 31, 2020 filed with
the Securities and Exchange Commission (the “SEC”) on March 16,
2021 (the “2020 Form 10-K”), on February 26, 2021, in connection
with management’s focus on expanding the Partnership’s business
strategy to focus on the ongoing energy transition in the
industries in which the Partnership operates, the Partnership
changed its name to Evolve Transition Infrastructure LP and its
general partner changed its name to Evolve Transition
Infrastructure GP LLC. The Partnership and SP Holdings, LLC, who
owns the general partner of the Partnership, are actively sourcing
new opportunities to transition the business of the Partnership
from a more traditional upstream and midstream oil and gas business
to a business focused on ownership of infrastructure critical to
the transition of energy supply to lower carbon sources and related
investments and opportunities.
LIQUIDITY AND CREDIT FACILITY
UPDATE
The Partnership had approximately $1.7 million
in cash and cash equivalents as of December 31, 2020. As of
December 31, 2020, the Partnership had $111.0 million in debt
outstanding under its credit facility and since December 31, 2019,
the Partnership has reduced its debt outstanding by $39.0 million,
or 26 percent. As previously disclosed, based upon the lenders
quarterly review of the borrowing base for the Partnership’s
midstream assets, the borrowing base has been set at $113.7
million. Since December 31, 2020, the Partnership has made
principal payments totaling $6.5 million resulting in $104.5
million in debt outstanding under the credit facility as of March
26, 2021. As previously disclosed, the Partnership’s credit
facility is a current liability that matures on September 30,
2021.
COMMON UNITS
The Partnership had 54,533,593 common units
issued and outstanding as of March 15, 2021 and has 56,185,378
common units issued and outstanding as of March 26, 2021.
RECEIPT OF AUDIT OPINION WITH GOING
CONCERN QUALIFICATION
Pursuant to the disclosure requirements of the
NYSE American Company Guidelines Sections 401(h) and 610(b), Evolve
is reporting that its audited financial statements for the year
ended December 31, 2020, included in the 2020 Form 10-K, contains
an audit opinion from its independent registered public accounting
firm that includes an explanatory paragraph related to Evolve’s
ability to continue as a going concern. This announcement does not
represent any change or amendment to the Partnership’s financial
statements or to its 2020 Form 10-K.
UNITHOLDER ACCESS TO 2020 FORM
10-K
The Partnership has filed the 2020 Form 10-K
with the SEC. A copy of the 2020 Form 10-K, which
includes the Partnership’s complete audited financial statements,
may be found on the SEC’s website at www.sec.gov and on the
Partnership’s website at www.evolvetransition.com by selecting the
“Investors” tab and then selecting “SEC Filings” from the dropdown
menu. The Partnership will provide any unitholder with a hard
copy of its 2020 Form 10-K, which includes Evolve’s complete
audited financial statements, free of charge at any time upon
request. Requests can be directed in writing to SNMP Investor
Relations, 1360 Post Oak Blvd., Suite 2400, Houston,
TX 77056 or by email to ir@evolvetranstion.com.
FORWARD-LOOKING STATEMENTS
This press release contains, and the officers
and representatives of the Partnership and its general partner may
from time to time make, statements that are considered
“forward–looking statements” as defined by the SEC. These
forward-looking statements are subject to a number of risks and
uncertainties, many of which are beyond our control, which may
include statements about our business strategy; our ability to
successfully implement our new energy transition infrastructure
business; the ability of our customers to meet their drilling and
development plans on a timely basis, or at all, and perform under
gathering, processing and other agreements; our financing strategy;
our acquisition strategy; our ability to make distributions; our
future operating results; the ability of our partners to perform
under our joint ventures; our future capital expenditures; and our
plans, objectives, expectations, forecasts, outlook and intentions.
All of these types of statements, other than statements of
historical fact included in this press release, are forward-looking
statements. In some cases, forward-looking statements can be
identified by terminology such as “may,” “could,” “should,”
“expect,” “plan,” “project,” “intend,” “anticipate,” “believe,”
“estimate,” “predict,” “potential,” “pursue,” “target,” “continue,”
the negative of such terms or other comparable terminology.
The forward-looking statements contained in this
press release are largely based on our expectations, which reflect
estimates and assumptions made by the management of our general
partner. 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 press release are not
guarantees of future performance, and we cannot assure any reader
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 forward-looking statements.
The 2020 Form 10-K, recent Current Reports on Form 8-K and other
filings with the SEC discuss some of the important risk factors
that may affect the Partnership’s business, results of operations,
and financial condition and you are encouraged to read such
filings. The forward-looking statements speak only as of the date
made, and other than as required by law, we do not intend to
publicly update or revise any forward-looking statements as a
result of new information, future events or otherwise. These
cautionary statements qualify all forward-looking statements
attributable to us or persons acting on our behalf.
ABOUT THE PARTNERSHIP
Evolve Transition Infrastructure LP is a
publicly-traded limited partnership focused on the acquisition,
development and ownership of infrastructure critical to the
transition of energy supply to lower carbon sources. We own natural
gas gathering systems, pipelines and processing facilities in South
Texas and continue to pursue energy transition infrastructure
opportunities.
ADDITIONAL INFORMATION
Additional information about Evolve can be found
in our documents on file with the SEC which are available on our
website at www.evolvetransition.com and on the SEC’s website at
www.sec.gov.
PARTNERSHIP CONTACT
Charles C. Ward Chief Financial Officer
ir@evolvetransition.com (713) 800-9477
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