DALLAS, Dec. 20, 2021 /PRNewswire/ -- EnLink
Midstream, LLC (NYSE: ENLC) (EnLink) today announced that it
intends to increase its quarterly distribution, beginning with the
fourth quarter of 2021, and provided an update on common and
preferred unit repurchases.
"As a result of our team's relentless execution and discipline,
EnLink has generated very robust free cash flow over the last
couple of years," said EnLink Chairman and CEO Barry E. Davis. "We have made tremendous
progress on our balance sheet, including with the repayment of our
term loan earlier this month. As we approach our near-term leverage
ratio target of 4x or below, we intend to employ a more balanced
capital allocation approach that allows us to continue to de-lever
the balance sheet and increase our return of capital to
unitholders. To that end, we are pleased to announce our intent to
increase the common unit distribution commencing with the fourth
quarter distribution and a refresh of our common unit repurchase
program. Importantly, with the common and preferred buybacks that
we have executed to date, our total common and preferred
distribution burden would increase by approximately $30 million, or only 11%, on an annualized basis,
as a result of the common unit distribution increase. This places
EnLink in a position of strength as we continue to generate
significant free cash flow after distributions in 2022 and
beyond."
Expected Distribution Increase
EnLink expects to
increase its regular cash distribution to $0.1125 per common unit, beginning with the
fourth quarter 2021 distribution. This distribution amount would
represent an increase of 20% from EnLink's third quarter 2021
distribution paid on November 12,
2021.
Common Unit Repurchase Program
EnLink has continued to
repurchase common units in the fourth quarter. Since the Board of
Directors authorized EnLink's common unit prepurchase program for
the repurchase of up to $100 million
of outstanding common units in November
2020, EnLink has repurchased approximately 6.5 million
outstanding common units in open market purchases, for an aggregate
cost, including commissions, of $41.3
million, or an average of $6.38 per common unit. The Board of Directors has
also reauthorized EnLink's common unit repurchase program and reset
the amount available for repurchases of outstanding common units at
up to $100 million effective
January 1, 2022.
Redemption of Series B Preferred Units
EnLink
announced that it has redeemed an aggregate of 3,300,330 Series B
Cumulative Convertible Preferred Units for total consideration of
$50 million plus accrued
distributions. The redemption price represents 101% of the
preferred units' par value.
About EnLink Midstream
EnLink Midstream reliably
operates a differentiated midstream platform that is built for
long-term, sustainable value creation. EnLink's best-in-class
services span the midstream value chain, providing natural gas,
crude oil, condensate, and NGL capabilities. Our purposely built,
integrated asset platforms are in premier production basins and
core demand centers, including the Permian Basin, Oklahoma, North
Texas, and the Gulf Coast. EnLink's strong financial
foundation and commitment to execution excellence drive competitive
returns and value for our employees, customers, and investors.
Headquartered in Dallas, EnLink is
publicly traded through EnLink Midstream, LLC (NYSE: ENLC). Visit
www.EnLink.com to learn how EnLink connects energy to life.
This press release contains forward-looking statements within
the meaning of the federal securities laws. Although these
statements reflect the current views, assumptions and expectations
of our management, the matters addressed herein involve certain
assumptions, risks and uncertainties that could cause actual
activities, performance, outcomes and results to differ materially
from those indicated herein. Therefore, you should not rely on any
of these forward-looking statements. All statements, other than
statements of historical fact, included in this press release
constitute forward-looking statements, including but not limited to
statements identified by the words "forecast," "may," "believe,"
"will," "should," "plan," "predict," "anticipate," "intend,"
"estimate," "expect", "continue," and similar expressions. Such
forward-looking statements include, but are not limited to,
statements about the level of distributions and the ability to make
distributions, projected or forecasted financial and operating
results, financial or leverage metrics, our future capital
structure, future repurchases of common units or redemptions of
preferred units, objectives, strategies, expectations, and
intentions, and other statements that are not historical facts.
Factors that could result in such differences or otherwise
materially affect our financial condition, results of operations,
or cash flows include, without limitation (a) the impact of the
ongoing coronavirus (COVID-19) pandemic including the impact of the
emergence of any new variants of the virus on our business,
financial condition, and results of operations, (b) potential
conflicts of interest of Global Infrastructure Partners ("GIP")
with us and the potential for GIP to favor GIP's own interests to
the detriment of our other unitholders, (c) GIP's ability to
compete with us and the fact that it is not required to offer us
the opportunity to acquire additional assets or businesses, (d) a
default under GIP's credit facility could result in a change in
control of us, could adversely affect the price of our common
units, and could result in a default under our credit facility and
certain of our other debt, (e) the dependence on Devon for a
substantial portion of the natural gas and crude that we gather,
process, and transport, (f) developments that materially and
adversely affect Devon or other customers, (g) adverse developments
in the midstream business that may reduce our ability to make
distributions, (h) competition for crude oil, condensate, natural
gas, and NGL supplies and any decrease in the availability of such
commodities, (i) decreases in the volumes that we gather, process,
fractionate, or transport, (j) construction risks in our major
development projects, (k) our ability to receive or renew required
permits and other approvals, (l) increased federal, state, and
local legislation, and regulatory initiatives, as well as
government reviews relating to hydraulic fracturing resulting in
increased costs and reductions or delays in natural gas production
by our customers, (m) climate change legislation and regulatory
initiatives resulting in increased operating costs and reduced
demand for the natural gas and NGL services we provide, (n) changes
in the availability and cost of capital, including as a result of a
change in our credit rating, (o) volatile prices and market demand
for crude oil, condensate, natural gas, and NGLs that are beyond
our control, (p) our debt levels could limit our flexibility and
adversely affect our financial health or limit our flexibility to
obtain financing and to pursue other business opportunities, (q)
operating hazards, natural disasters, weather-related issues or
delays, casualty losses, and other matters beyond our control, (r)
reductions in demand for NGL products by the petrochemical,
refining, or other industries or by the fuel markets, (s)
impairments to goodwill, long-lived assets and equity method
investments, and (t) the effects of existing and future laws and
governmental regulations, including environmental and climate
change requirements and other uncertainties. These and other
applicable uncertainties, factors, and risks are described more
fully in EnLink Midstream, LLC's and EnLink Midstream Partners,
LP's filings with the Securities and Exchange Commission, including
EnLink Midstream, LLC's and EnLink Midstream Partners, LP's Annual
Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current
Reports on Form 8-K. Neither EnLink Midstream, LLC nor EnLink
Midstream Partners, LP assumes any obligation to update any
forward-looking statements.
Investor Relations: Brian
Brungardt, Director of Investor Relations, 214-721-9353,
brian.brungardt@enlink.com
Media Relations: Jill
McMillan, Vice President of Strategic Relations &
Public Affairs, 214-721-9271, jill.mcmillan@enlink.com
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SOURCE EnLink Midstream, LLC