DENVER, Oct. 26,
2022 /PRNewswire/ -- Antero Midstream Corporation
(NYSE: AM) ("Antero Midstream" or the "Company") today
announced its third quarter 2022 financial and operational results.
The relevant unaudited condensed consolidated financial
statements are included in Antero Midstream's Quarterly Report on
Form 10-Q for the quarter ended September
30, 2022.
Third Quarter 2022 Earnings Highlights:
- Net Income was $84 million, or
$0.17 per diluted share
- Adjusted Net Income was $96
million, or $0.20 per share
(non-GAAP measure)
- Adjusted EBITDA was $223
million (non-GAAP measure)
- Net cash provided by operating activities was $177 million
- Free Cash Flow after dividends was $30 million (non-GAAP measure)
- Low pressure gathering volumes per day increased by 3%
compared to the prior year quarter
- Announced a $205 million
bolt-on acquisition of Marcellus gathering and compression
assets
Paul Rady, Chairman and CEO said,
"This quarter marked an important inflection point as we generated
$30 million of Free Cash Flow after
dividends. This was driven by a reduction in capital expenditures
as we completed milestone projects supporting the expected growth
from the drilling partnership. This transition to generating
consistent Free Cash Flow after dividends significantly de-risks
our business model over the next several years and positions us
well to achieve our leverage target of 3.0x or less by year end
2024."
Mr. Rady added, "In addition, we closed the $205 million bolt-on acquisition of gathering and
compression assets in the Marcellus Shale. This complementary
acquisition with highly visible throughput in the core of the
Marcellus Shale is a strategic fit with Antero Midstream's
assets."
Marcellus Bolt-on Acquisition
Closing
On October 25, 2022, Antero
Midstream closed the previously announced bolt-on acquisition of
Marcellus gathering and compression assets from Crestwood Equity
Partners, LP (NYSE: CEQP) for $205
million in cash. The transaction was financed with
borrowings under the Company's revolving credit facility. The
assets include 72 miles of dry gas gathering pipelines and nine
compressor stations with approximately 700 MMcf/d of capacity. The
transaction increases Antero Midstream's compression capacity by
20% and gathering pipeline mileage by 15%, and importantly, has
significant available capacity for growth without significant
capital investment. Antero Midstream has identified over
$50 million of discounted future
capital avoidance, integration and operational synergies, resulting
in an adjusted transaction multiple of 4.5x next twelve months
estimated Adjusted EBITDA.
The acquisition includes approximately 120,000 gross dedicated
acres for gathering and compression and over 425 undeveloped
drilling locations from Antero Resources. In addition, through the
first nine months of 2022, Antero Resources has also added
approximately 60 drilling locations from its organic leasing
program. This results in approximately 485 total locations added
year-do-date dedicated to Antero Midstream, which represents an
additional seven to eight years of drilling inventory at the
current development pace.
Brendan Krueger, CFO of Antero
Midstream, said "Antero Midstream's highly visible and sustainable
Free Cash Flow after dividends profile allowed us to finance the
$205 million bolt-on acquisition with
revolver borrowings. This strategic acquisition, with over
$50 million of discounted future
capital avoidance and synergies, is expected to further enhance our
Free Cash Flow profile after dividends by over 10% through
2026."
For a discussion of the non-GAAP financial measures,
including Adjusted EBITDA, Adjusted Net Income, Leverage and Free
Cash Flow after dividends please see "Non-GAAP
Financial Measures."
Third Quarter 2022 Financial Results
Low pressure gathering volumes for the third quarter of 2022
averaged 2,952 MMcf/d, a 3% increase as compared to the prior
year quarter. Low pressure gathering volumes were in excess
of the growth incentive fee threshold of 2,900 MMcf/d, resulting in
a $12 million rebate to Antero
Resources. Compression volumes for the third quarter of 2022
averaged 2,794 MMcf/d, a 2% increase compared to the prior
year quarter. High pressure gathering volumes averaged
2,802 MMcf/d, in line with the third quarter of 2021. Fresh
water delivery volumes averaged 103 MBbl/d during the quarter,
a 13% increase compared to the third quarter of 2021.
Gross processing volumes from our processing and fractionation
joint venture with MPLX, LP (the "Joint Venture") averaged
1,474 MMcf/d for the third quarter of 2022, a 4% decrease
compared to the prior year quarter. Joint Venture processing
capacity was 92% utilized during the quarter based on nameplate
processing capacity of 1.6 Bcf/d. Gross Joint Venture
fractionation volumes averaged 36 MBbl/d, a 3% decrease
compared to the prior year quarter. Joint Venture fractionation
capacity was 90% utilized during the quarter based on nameplate
fractionation capacity of 40 MBbl/d.
|
|
Three Months
Ended
September
30,
|
|
|
|
|
Average Daily
Volumes:
|
|
2021
|
|
2022
|
|
%
Change
|
|
|
Low Pressure Gathering
(MMcf/d)
|
|
2,880
|
|
2,952
|
|
3 %
|
|
|
Compression
(MMcf/d)
|
|
2,734
|
|
2,794
|
|
2 %
|
|
|
High Pressure
Gathering (MMcf/d)
|
|
2,811
|
|
2,802
|
|
*
|
|
|
Fresh Water Delivery
(MBbl/d)
|
|
91
|
|
103
|
|
13 %
|
|
|
Gross Joint Venture
Processing (MMcf/d)
|
|
1,539
|
|
1,474
|
|
(4) %
|
|
|
Gross Joint Venture
Fractionation (MBbl/d)
|
|
37
|
|
36
|
|
(3) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three months ended September 30,
2022, revenues were $231 million, comprised of
$176 million from the Gathering and Processing segment and
$55 million from the Water Handling segment, net of
$18 million of amortization of customer relationships.
Water Handling revenues included $2
million from third party water business and $24 million
from wastewater handling and high rate water transfer services.
Direct operating expenses for the Gathering and Processing and
Water Handling segments were $20 million and $27 million,
respectively, for a total of $47 million. Water Handling
operating expenses include $23 million from wastewater
handling and high rate water transfer services. General and
administrative expenses excluding equity-based compensation were
$8 million during the third quarter of 2022. Total
operating expenses during the third quarter of 2022 included
$6 million of equity-based compensation expense,
$34 million of depreciation and a $2 million gain on
asset sale.
Net Income was $84 million, or
$0.17 per diluted share.
Net Income adjusted for amortization of customer relationships,
impairment expense, and gain on asset sale, net of tax effects of
reconciling items, or Adjusted Net Income, was $96 million.
Adjusted Net Income was $0.20 per
share.
The following table reconciles Net Income to Adjusted Net Income
(in thousands):
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
|
|
2021
|
|
|
2022
|
|
Net Income
|
|
$
|
89,327
|
|
|
84,014
|
|
Amortization of
customer relationships
|
|
|
17,668
|
|
|
17,668
|
|
Impairment
expense
|
|
|
203
|
|
|
—
|
|
Gain on asset
sale
|
|
|
—
|
|
|
(2,092)
|
|
Tax effect of
reconciling items(1)
|
|
|
(4,455)
|
|
|
(4,012)
|
|
Adjusted Net
Income
|
|
$
|
102,743
|
|
|
95,578
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Statutory tax rate
was approximately 24.9% for 2021 and 25.8% for 2022.
|
Adjusted EBITDA was $223 million, a 2% increase compared to
the prior year quarter. Interest expense was $48 million, a 7%
increase compared to the prior year quarter. Capital expenditures
were $37 million, a 54% decrease compared to the prior year
quarter. Free Cash Flow before dividends was
$138 million, a 47% increase compared to the prior year
quarter. Free Cash Flow after dividends was $30 million
compared to a $13 million deficit in the prior year
quarter.
The following table reconciles Net Income to Adjusted EBITDA and
Free Cash Flow before and after dividends (in thousands):
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
|
|
2021
|
|
|
2022
|
Net Income
|
|
$
|
89,327
|
|
|
84,014
|
Interest expense,
net
|
|
|
44,544
|
|
|
47,835
|
Income tax
expense
|
|
|
32,038
|
|
|
30,332
|
Amortization of
customer relationships
|
|
|
17,668
|
|
|
17,668
|
Depreciation
expense
|
|
|
27,487
|
|
|
34,206
|
Impairment
expense
|
|
|
203
|
|
|
—
|
Gain on asset
sale
|
|
|
—
|
|
|
(2,092)
|
Accretion of asset
retirement obligations
|
|
|
114
|
|
|
50
|
Equity-based
compensation
|
|
|
3,255
|
|
|
5,553
|
Equity in earnings of
unconsolidated affiliates
|
|
|
(24,088)
|
|
|
(24,411)
|
Distributions from
unconsolidated affiliates
|
|
|
28,930
|
|
|
29,965
|
Adjusted
EBITDA
|
|
$
|
219,478
|
|
|
223,120
|
Interest
expense
|
|
|
(44,544)
|
|
|
(47,835)
|
Capital expenditures
(accrual-based)
|
|
|
(80,873)
|
|
|
(37,168)
|
Free Cash Flow
before dividends
|
|
$
|
94,061
|
|
|
138,117
|
Dividends declared
(accrual-based)
|
|
|
(107,436)
|
|
|
(107,659)
|
Free Cash Flow after
dividends
|
|
$
|
(13,375)
|
|
|
30,458
|
|
|
|
|
|
|
|
|
|
|
The following table reconciles net cash provided by operating
activities to Free Cash Flow before and after dividends (in
thousands):
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
|
|
2021
|
|
|
2022
|
Net cash provided by
operating activities
|
|
$
|
185,115
|
|
|
176,795
|
Amortization of
deferred financing costs
|
|
|
(1,419)
|
|
|
(1,440)
|
Settlement of asset
retirement obligations
|
|
|
212
|
|
|
479
|
Changes in working
capital
|
|
|
(8,974)
|
|
|
(549)
|
Capital expenditures
(accrual-based)
|
|
|
(80,873)
|
|
|
(37,168)
|
Free Cash Flow
before dividends
|
|
$
|
94,061
|
|
|
138,117
|
Dividends declared
(accrual-based)
|
|
|
(107,436)
|
|
|
(107,659)
|
Free Cash Flow after
dividends
|
|
$
|
(13,375)
|
|
|
30,458
|
|
|
|
|
|
|
|
|
|
|
Third Quarter 2022 Operating Update
Gathering and Processing — During the third
quarter of 2022, Antero Midstream connected 22 wells to its
gathering system. Antero Midstream finished construction on the
Wetzel County high pressure pipeline that was placed online in the
third quarter of 2022. This high pressure trunkline, in addition to
the compression capacity placed in service in the second quarter of
2022 will support the expected throughput growth in 2023 and
beyond.
Water Handling— Antero Midstream's water
delivery systems serviced 18 well completions during the third
quarter of 2022. These completions, which drove a 13% increase in
fresh water delivery volumes compared to the prior year quarter,
will generate momentum in throughput volume growth in 2023.
Capital Investments
Accrued capital expenditures were $37
million during the third quarter of 2022. The company
invested $54 million in gathering, compression, and water
infrastructure primarily in the liquids-rich midstream corridor of
the Marcellus shale. In addition, the Company received a
$17 million reimbursement of the
prior capital expenditures related to the sale of the Smithburg 2
processing plant. As a result, Antero Midstream expects full year
2022 capital expenditures to be at the low end of the capital
budget guidance range of $275 million
to $300 million.
Conference Call
A conference call is scheduled on Thursday, October 27, 2022 at 10:00 am MT to discuss the financial and
operational results. A brief Q&A session for security
analysts will immediately follow the discussion of the
results. To participate in the call, dial in at 877-407-9126
(U.S.), or 201-493-6751 (International) and reference "Antero
Midstream". A telephone replay of the call will be available
until Thursday, November 3, 2022 at
10:00 am MT at 877-660-6853 (U.S.) or
201-612-7415 (International) using the conference ID: 13726235. To
access the live webcast and view the related earnings conference
call presentation, visit Antero Midstream's website at
www.anteromidstream.com. The webcast will be archived for
replay until Thursday, November 3,
2022 at 10:00 am MT.
Non-GAAP Financial Measures and Definitions
Antero Midstream uses certain non-GAAP financial measures.
Antero Midstream defines Adjusted Net Income as Net Income plus
amortization of customer relationships and impairment expense,
excluding gain on asset sale, net of tax effect of reconciling
items. Antero Midstream uses Adjusted Net Income to assess the
operating performance of its assets. Antero Midstream defines
Adjusted EBITDA as Net Income plus interest expense, income tax
expense, amortization of customer relationships, depreciation
expense, impairment expense, (gain) on asset sale, accretion of
asset retirement obligations, loss on settlement of asset
retirement obligations and loss on early extinguishment of debt and
equity-based compensation expense, excluding equity in earnings of
unconsolidated affiliates, plus distributions from unconsolidated
affiliates.
Antero Midstream uses Adjusted EBITDA to assess:
- the financial performance of Antero Midstream's assets, without
regard to financing methods, capital structure or historical cost
basis;
- its operating performance and return on capital as compared to
other publicly traded companies in the midstream energy sector,
without regard to financing or capital structure; and
- the viability of acquisitions and other capital expenditure
projects.
Antero Midstream defines Free Cash Flow before dividends as
Adjusted EBITDA less interest expense and accrual-based capital
expenditures. Capital expenditures include additions to gathering
systems and facilities, additions to water handling systems,
investments in unconsolidated affiliates, and return of investment
in unconsolidated affiliates. Capital expenditures exclude
acquisitions. Free Cash Flow after dividends is defined as Free
Cash Flow before dividends less accrual-based dividends declared
for the quarter. Antero Midstream uses Free Cash Flow before and
after dividends as a performance metric to compare the cash
generating performance of Antero Midstream from period to
period.
Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow before
and after dividends are non-GAAP financial measures. The GAAP
measure most directly comparable to these measures is Net Income.
Such non-GAAP financial measures should not be considered as
alternatives to the GAAP measures of Net Income and cash flows
provided by (used in) operating activities. The presentations
of such measures are not made in accordance with GAAP and have
important limitations as analytical tools because they include
some, but not all, items that affect Net Income and cash flows
provided by (used in) operating activities. You should not
consider any or all such measures in isolation or as a substitute
for analyses of results as reported under GAAP. Antero
Midstream's definitions of such measures may not be comparable to
similarly titled measures of other companies.
The following table reconciles cash paid for capital
expenditures and accrued capital expenditures during the period (in
thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
|
|
|
2021
|
|
|
2022
|
|
Capital expenditures
(as reported on a cash basis)(1)
|
|
$
|
83,687
|
|
|
57,120
|
|
Change in accrued
capital costs
|
|
|
(2,814)
|
|
|
(19,952)
|
|
Capital expenditures
(accrual basis)
|
|
$
|
80,873
|
|
|
37,168
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Cash basis capital
expenditures includes $17 million return of investment in
unconsolidated affiliate in 2022.
|
Antero Midstream defines Net Debt as consolidated total debt,
excluding unamortized debt premiums and debt issuance costs, less
cash and cash equivalents. Antero Midstream views Net Debt as an
important indicator in evaluating Antero Midstream's financial
leverage. Antero Midstream defines leverage as Net Debt divided by
Adjusted EBITDA for the last twelve months. The GAAP measure most
directly comparable to Net Debt is total debt, excluding
unamortized debt premiums and debt issuance costs.
The following table reconciles consolidated total debt to
consolidated net debt, excluding debt premiums and issuance costs,
("Net Debt") as used in this release (in thousands):
|
|
|
|
|
|
|
|
|
|
September 30,
2022
|
|
Bank credit
facility
|
|
$
|
564,800
|
|
7.875% senior notes due
2026
|
|
|
550,000
|
|
5.75% senior notes due
2027
|
|
|
650,000
|
|
5.75% senior notes due
2028
|
|
|
650,000
|
|
5.375% senior notes due
2029
|
|
|
750,000
|
|
Consolidated total
debt
|
|
$
|
3,164,800
|
|
Cash and cash
equivalents
|
|
|
—
|
|
Consolidated net
debt
|
|
$
|
3,164,800
|
|
The following table reconciles Net Income to Adjusted EBITDA for
the last twelve months as used in this release (in thousands):
|
|
|
|
|
|
|
|
|
|
Twelve Months
Ended
September 30,
2022
|
|
Net Income
|
|
$
|
322,075
|
|
Interest
expense
|
|
|
181,906
|
|
Income tax
expense
|
|
|
113,374
|
|
Amortization of
customer relationships
|
|
|
70,672
|
|
Depreciation
expense
|
|
|
126,015
|
|
Impairment
expense
|
|
|
7,162
|
|
Accretion of asset
retirement obligations
|
|
|
291
|
|
Equity-based
compensation
|
|
|
17,229
|
|
Equity in earnings of
unconsolidated affiliates
|
|
|
(94,571)
|
|
Distributions from
unconsolidated affiliates
|
|
|
122,345
|
|
Loss on settlement of
asset retirement obligations
|
|
|
539
|
|
Loss on early
extinguishment of debt
|
|
|
1,056
|
|
Gain on asset
sale
|
|
|
(2,242)
|
|
Adjusted
EBITDA
|
|
$
|
865,851
|
|
Antero Midstream Corporation is a Delaware corporation that owns, operates and
develops midstream gathering, compression, processing and
fractionation assets located in the Appalachian Basin, as well as
integrated water assets that primarily service Antero Resources
Corporation's properties.
This release includes "forward-looking statements." Such
forward-looking statements are subject to a number of risks and
uncertainties, many of which are not under Antero Midstream's
control. All statements, except for statements of historical fact,
made in this release regarding activities, events or developments
Antero Midstream expects, believes or anticipates will or may occur
in the future, such as statements regarding Antero Midstream's
ability to realize the benefits of the Marcellus bolt-on
acquisition, including the anticipated capital avoidance and
synergies, Antero Midstream's ability to execute its business plan
and return capital to its stockholders, information regarding
Antero Midstream's return of capital policy, information regarding
long-term financial and operating outlooks for Antero Midstream and
Antero Resources, information regarding Antero Resources' expected
future growth and its ability to meet its drilling and development
plan and the participation level of Antero Resources'
drilling partner and the impact on demand for Antero Midstream's
services as a result of incremental production by Antero Resources,
are forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. All forward-looking statements speak only as
of the date of this release. Although Antero Midstream believes
that the plans, intentions and expectations reflected in or
suggested by the forward-looking statements are reasonable, there
is no assurance that these plans, intentions or expectations will
be achieved. Therefore, actual outcomes and results could
materially differ from what is expressed, implied or forecast in
such statements. Except as required by law, Antero Midstream
expressly disclaims any obligation to and does not intend to
publicly update or revise any forward-looking statements.
Antero Midstream cautions you that these forward-looking
statements are subject to all of the risks and uncertainties
incident to our business, most of which are difficult to predict
and many of which are beyond Antero Midstream's control. These
risks include, but are not limited to, commodity price volatility,
inflation, environmental risks, Antero Resources' drilling and
completion and other operating risks, regulatory changes, the
uncertainty inherent in projecting Antero Resources' future rates
of production, cash flows and access to capital, the timing of
development expenditures, impacts of geopolitical events and world
health events, including the COVID-19 pandemic, cybersecurity risk,
our ability to achieve our greenhouse gas reduction targets and the
costs associated therewith, the state of markets for and
availability of verified quality carbon offsets and the other risks
described under the heading "Item 1A. Risk Factors" in Antero
Midstream's Annual Report on Form 10-K for the year ended
December 31, 2021 and Quarterly
Report on Form 10-Q for the quarter ended September 30, 2022.
ANTERO MIDSTREAM
CORPORATION
|
Condensed
Consolidated Balance Sheets
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
December 31,
|
|
September 30,
|
|
|
|
2021
|
|
2022
|
|
Assets
|
Current
assets:
|
|
|
|
|
|
|
|
Accounts
receivable–Antero Resources
|
|
$
|
81,197
|
|
|
77,301
|
|
Accounts
receivable–third party
|
|
|
747
|
|
|
1,988
|
|
Income tax
receivable
|
|
|
940
|
|
|
940
|
|
Other current
assets
|
|
|
920
|
|
|
556
|
|
Total current
assets
|
|
|
83,804
|
|
|
80,785
|
|
|
|
|
|
|
|
|
|
Property and equipment,
net
|
|
|
3,394,746
|
|
|
3,508,008
|
|
Investments in
unconsolidated affiliates
|
|
|
696,009
|
|
|
659,006
|
|
Customer
relationships
|
|
|
1,356,775
|
|
|
1,303,771
|
|
Other assets,
net
|
|
|
12,667
|
|
|
12,251
|
|
Total
assets
|
|
$
|
5,544,001
|
|
|
5,563,821
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable–Antero Resources
|
|
$
|
4,956
|
|
|
2,648
|
|
Accounts payable–third
party
|
|
|
23,592
|
|
|
24,125
|
|
Accrued
liabilities
|
|
|
80,838
|
|
|
72,952
|
|
Other current
liabilities
|
|
|
4,623
|
|
|
6,657
|
|
Total current
liabilities
|
|
|
114,009
|
|
|
106,382
|
|
Long-term
liabilities:
|
|
|
|
|
|
|
|
Long-term
debt
|
|
|
3,122,910
|
|
|
3,143,169
|
|
Deferred income tax
liability
|
|
|
13,721
|
|
|
98,519
|
|
Other
|
|
|
6,663
|
|
|
3,896
|
|
Total
liabilities
|
|
|
3,257,303
|
|
|
3,351,966
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity:
|
|
|
|
|
|
|
|
Preferred stock, $0.01
par value: 100,000 authorized as of December 31, 2021 and
September 30, 2022
|
|
|
|
|
|
|
|
Series A non-voting
perpetual preferred stock; 12 designated and 10 issued and
outstanding as of December 31, 2021 and September 30,
2022
|
|
|
—
|
|
|
—
|
|
Common stock, $0.01
par value; 2,000,000 authorized; 477,495 and 478,462 issued and
outstanding as of December 31, 2021 and September 30,
2022, respectively
|
|
|
4,775
|
|
|
4,784
|
|
Additional paid-in
capital
|
|
|
2,414,398
|
|
|
2,123,057
|
|
Retained earnings
(accumulated deficit)
|
|
|
(132,475)
|
|
|
84,014
|
|
Total stockholders'
equity
|
|
|
2,286,698
|
|
|
2,211,855
|
|
Total liabilities and
stockholders' equity
|
|
$
|
5,544,001
|
|
|
5,563,821
|
|
ANTERO MIDSTREAM
CORPORATION
|
Condensed Consolidated
Statements of Operations and Comprehensive Income
|
(In thousands, except
per share amounts)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
|
|
2021
|
|
2022
|
|
Revenue:
|
|
|
|
|
|
|
|
Gathering and
compression–Antero Resources
|
|
$
|
188,716
|
|
|
185,640
|
|
Water handling–Antero
Resources
|
|
|
53,511
|
|
|
61,411
|
|
Water handling–third
party
|
|
|
245
|
|
|
1,651
|
|
Amortization of
customer relationships
|
|
|
(17,668)
|
|
|
(17,668)
|
|
Total
revenue
|
|
|
224,804
|
|
|
231,034
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Direct
operating
|
|
|
39,499
|
|
|
46,648
|
|
General and
administrative (including $3,255 and $5,553 of equity-based
compensation in
2021 and 2022, respectively)
|
|
|
14,810
|
|
|
13,587
|
|
Facility
idling
|
|
|
870
|
|
|
865
|
|
Depreciation
|
|
|
27,487
|
|
|
34,206
|
|
Impairment of property
and equipment
|
|
|
203
|
|
|
—
|
|
Accretion of asset
retirement obligations
|
|
|
114
|
|
|
50
|
|
Gain on asset
sale
|
|
|
—
|
|
|
(2,092)
|
|
Total operating
expenses
|
|
|
82,983
|
|
|
93,264
|
|
Operating
income
|
|
|
141,821
|
|
|
137,770
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
|
(44,544)
|
|
|
(47,835)
|
|
Equity in earnings of
unconsolidated affiliates
|
|
|
24,088
|
|
|
24,411
|
|
Total other
expense
|
|
|
(20,456)
|
|
|
(23,424)
|
|
Income before income
taxes
|
|
|
121,365
|
|
|
114,346
|
|
Income tax
expense
|
|
|
(32,038)
|
|
|
(30,332)
|
|
Net income and
comprehensive income
|
|
$
|
89,327
|
|
|
84,014
|
|
|
|
|
|
|
|
|
|
Net income per
share–basic
|
|
$
|
0.19
|
|
|
0.18
|
|
Net income per
share–diluted
|
|
$
|
0.19
|
|
|
0.17
|
|
|
|
|
|
|
|
|
|
Weighted average common
shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
|
|
477,442
|
|
|
478,460
|
|
Diluted
|
|
|
479,695
|
|
|
480,318
|
|
ANTERO MIDSTREAM
CORPORATION
|
Selected Operating
Data
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Amount
of
|
|
|
|
|
|
|
September 30,
|
|
Increase
|
|
Percentage
|
|
|
2021
|
|
2022
|
|
or
Decrease
|
|
Change
|
Operating
Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gathering—low pressure
(MMcf)
|
|
|
264,999
|
|
|
271,569
|
|
|
6,570
|
|
|
2
|
%
|
Compression
(MMcf)
|
|
|
251,555
|
|
|
257,025
|
|
|
5,470
|
|
|
2
|
%
|
Gathering—high
pressure (MMcf)
|
|
|
258,585
|
|
|
257,757
|
|
|
(828)
|
|
|
*
|
|
Fresh water delivery
(MBbl)
|
|
|
8,335
|
|
|
9,515
|
|
|
1,180
|
|
|
14
|
%
|
Other fluid handling
(MBbl)
|
|
|
4,325
|
|
|
5,280
|
|
|
955
|
|
|
22
|
%
|
Wells serviced by
fresh water delivery
|
|
|
18
|
|
|
18
|
|
|
—
|
|
|
*
|
|
Gathering—low pressure
(MMcf/d)
|
|
|
2,880
|
|
|
2,952
|
|
|
72
|
|
|
3
|
%
|
Compression
(MMcf/d)
|
|
|
2,734
|
|
|
2,794
|
|
|
60
|
|
|
2
|
%
|
Gathering—high
pressure (MMcf/d)
|
|
|
2,811
|
|
|
2,802
|
|
|
(9)
|
|
|
*
|
|
Fresh water delivery
(MBbl/d)
|
|
|
91
|
|
|
103
|
|
|
12
|
|
|
13
|
%
|
Other fluid handling
(MBbl/d)
|
|
|
47
|
|
|
57
|
|
|
10
|
|
|
21
|
%
|
Average Realized
Fees:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average gathering—low
pressure fee ($/Mcf)
|
|
$
|
0.33
|
|
|
0.34
|
|
|
0.01
|
|
|
3
|
%
|
Average compression
fee ($/Mcf)
|
|
$
|
0.20
|
|
|
0.21
|
|
|
0.01
|
|
|
3
|
%
|
Average gathering—high
pressure fee ($/Mcf)
|
|
$
|
0.20
|
|
|
0.21
|
|
|
0.01
|
|
|
3
|
%
|
Average fresh water
delivery fee ($/Bbl)
|
|
$
|
3.96
|
|
|
4.04
|
|
|
0.08
|
|
|
2
|
%
|
Joint Venture
Operating Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Processing—Joint
Venture (MMcf)
|
|
|
141,580
|
|
|
135,611
|
|
|
(5,969)
|
|
|
(4)
|
%
|
Fractionation—Joint
Venture (MBbl)
|
|
|
3,408
|
|
|
3,287
|
|
|
(121)
|
|
|
(4)
|
%
|
Processing—Joint
Venture (MMcf/d)
|
|
|
1,539
|
|
|
1,474
|
|
|
(65)
|
|
|
(4)
|
%
|
Fractionation—Joint
Venture (MBbl/d)
|
|
|
37
|
|
|
36
|
|
|
(1)
|
|
|
(3)
|
%
|
ANTERO MIDSTREAM
CORPORATION
|
Condensed Consolidated
Results of Segment Operations
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
September 30, 2022
|
|
|
|
Gathering and
|
|
Water
|
|
|
|
Consolidated
|
|
(in
thousands)
|
|
Processing
|
|
Handling
|
|
Unallocated
|
|
Total
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue–Antero
Resources
|
|
$
|
197,640
|
|
|
61,411
|
|
|
—
|
|
|
259,051
|
|
Revenue–third-party
|
|
|
—
|
|
|
1,651
|
|
|
—
|
|
|
1,651
|
|
Gathering—low pressure
rebate
|
|
|
(12,000)
|
|
|
—
|
|
|
—
|
|
|
(12,000)
|
|
Amortization of
customer relationships
|
|
|
(9,271)
|
|
|
(8,397)
|
|
|
—
|
|
|
(17,668)
|
|
Total
revenues
|
|
|
176,369
|
|
|
54,665
|
|
|
—
|
|
|
231,034
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct
operating
|
|
|
19,813
|
|
|
26,835
|
|
|
—
|
|
|
46,648
|
|
General and
administrative (excluding equity-based compensation)
|
|
|
5,657
|
|
|
1,300
|
|
|
1,077
|
|
|
8,034
|
|
Equity-based
compensation
|
|
|
4,233
|
|
|
1,125
|
|
|
195
|
|
|
5,553
|
|
Facility
idling
|
|
|
—
|
|
|
865
|
|
|
—
|
|
|
865
|
|
Depreciation
|
|
|
21,177
|
|
|
13,029
|
|
|
—
|
|
|
34,206
|
|
Accretion of asset
retirement obligations
|
|
|
—
|
|
|
50
|
|
|
—
|
|
|
50
|
|
Gain on asset
sale
|
|
|
(2,056)
|
|
|
(36)
|
|
|
—
|
|
|
(2,092)
|
|
Total operating
expenses
|
|
|
48,824
|
|
|
43,168
|
|
|
1,272
|
|
|
93,264
|
|
Operating
income
|
|
|
127,545
|
|
|
11,497
|
|
|
(1,272)
|
|
|
137,770
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
|
—
|
|
|
—
|
|
|
(47,835)
|
|
|
(47,835)
|
|
Equity in earnings of
unconsolidated affiliates
|
|
|
24,411
|
|
|
—
|
|
|
—
|
|
|
24,411
|
|
Total other income
(expense)
|
|
|
24,411
|
|
|
—
|
|
|
(47,835)
|
|
|
(23,424)
|
|
Income before income
taxes
|
|
|
151,956
|
|
|
11,497
|
|
|
(49,107)
|
|
|
114,346
|
|
Income tax
expense
|
|
|
—
|
|
|
—
|
|
|
(30,332)
|
|
|
(30,332)
|
|
Net income and
comprehensive income
|
|
$
|
151,956
|
|
|
11,497
|
|
|
(79,439)
|
|
|
84,014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
|
|
|
$
|
223,120
|
|
ANTERO MIDSTREAM
CORPORATION
|
Condensed Consolidated
Statements of Cash Flows
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
September 30,
|
|
|
|
2021
|
|
2022
|
|
Cash flows provided by
(used in) operating activities:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
252,991
|
|
|
243,449
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
Depreciation
|
|
|
80,956
|
|
|
98,181
|
|
Accretion of asset
retirement obligations
|
|
|
347
|
|
|
178
|
|
Impairment
|
|
|
1,582
|
|
|
3,702
|
|
Deferred income tax
expense
|
|
|
88,547
|
|
|
84,798
|
|
Equity-based
compensation
|
|
|
10,326
|
|
|
14,026
|
|
Equity in earnings of
unconsolidated affiliates
|
|
|
(66,347)
|
|
|
(70,467)
|
|
Distributions from
unconsolidated affiliates
|
|
|
87,115
|
|
|
90,470
|
|
Amortization of
customer relationships
|
|
|
53,004
|
|
|
53,004
|
|
Amortization of
deferred financing costs
|
|
|
4,152
|
|
|
4,268
|
|
Settlement of asset
retirement obligations
|
|
|
(814)
|
|
|
(1,395)
|
|
Loss on settlement of
asset retirement obligations
|
|
|
—
|
|
|
539
|
|
Loss (gain) on asset
sale
|
|
|
3,628
|
|
|
(2,242)
|
|
Loss on early
extinguishment of debt
|
|
|
20,701
|
|
|
—
|
|
|
|
|
|
|
|
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
Accounts
receivable–Antero Resources
|
|
|
(11,429)
|
|
|
5,596
|
|
Accounts
receivable–third party
|
|
|
594
|
|
|
(822)
|
|
Income tax
receivable
|
|
|
16,311
|
|
|
—
|
|
Other current
assets
|
|
|
810
|
|
|
242
|
|
Accounts
payable–Antero Resources
|
|
|
(705)
|
|
|
(2,006)
|
|
Accounts payable–third
party
|
|
|
11,058
|
|
|
12,228
|
|
Accrued
liabilities
|
|
|
(7,337)
|
|
|
(2,773)
|
|
Net cash provided by
operating activities
|
|
|
545,490
|
|
|
530,976
|
|
Cash flows provided by
(used in) investing activities:
|
|
|
|
|
|
|
|
Additions to gathering
systems and facilities
|
|
|
(120,727)
|
|
|
(190,407)
|
|
Additions to water
handling systems
|
|
|
(36,221)
|
|
|
(45,747)
|
|
Investments in
unconsolidated affiliates
|
|
|
(2,070)
|
|
|
—
|
|
Return of investment
in unconsolidated affiliate
|
|
|
—
|
|
|
17,000
|
|
Cash received in asset
sale
|
|
|
1,653
|
|
|
4,026
|
|
Change in other
assets
|
|
|
—
|
|
|
(24)
|
|
Change in other
liabilities
|
|
|
—
|
|
|
(804)
|
|
Net cash used in
investing activities
|
|
|
(157,365)
|
|
|
(215,956)
|
|
Cash flows provided by
(used in) financing activities:
|
|
|
|
|
|
|
|
Dividends to
stockholders
|
|
|
(363,712)
|
|
|
(325,120)
|
|
Dividends to preferred
stockholders
|
|
|
(413)
|
|
|
(413)
|
|
Issuance of senior
notes
|
|
|
750,000
|
|
|
—
|
|
Redemption of senior
notes
|
|
|
(667,472)
|
|
|
—
|
|
Payments of deferred
financing costs
|
|
|
(9,449)
|
|
|
(302)
|
|
Borrowings
(repayments) on bank credit facilities, net
|
|
|
(92,800)
|
|
|
17,600
|
|
Employee tax
withholding for settlement of equity compensation awards
|
|
|
(4,885)
|
|
|
(6,785)
|
|
Other
|
|
|
(34)
|
|
|
—
|
|
Net cash used in
financing activities
|
|
|
(388,765)
|
|
|
(315,020)
|
|
Net decrease in cash
and cash equivalents
|
|
|
(640)
|
|
|
—
|
|
Cash and cash
equivalents, beginning of period
|
|
|
640
|
|
|
—
|
|
Cash and cash
equivalents, end of period
|
|
$
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
Supplemental disclosure
of cash flow information:
|
|
|
|
|
|
|
|
Cash paid during the
period for interest
|
|
$
|
132,360
|
|
|
130,236
|
|
Cash received during
the period for income taxes
|
|
$
|
16,913
|
|
|
—
|
|
Increase (decrease) in
accrued capital expenditures and accounts payable for property and
equipment
|
|
$
|
22,675
|
|
|
(17,130)
|
|
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multimedia:https://www.prnewswire.com/news-releases/antero-midstream-announces-third-quarter-2022-financial-and-operational-results-301660431.html
SOURCE Antero Midstream Corporation