THE WOODLANDS,
Texas, May 6,
2015 /PRNewswire/ -- Summit Midstream Partners,
LP (NYSE: SMLP) announced today that its wholly owned subsidiary,
Bison Midstream, LLC ("Bison Midstream"), will acquire the equity
interests of certain subsidiaries of Summit Midstream Partners, LLC
("Summit Investments") for total cash consideration of $255.0 million, subject to customary purchase
price adjustments (the "Acquisition"). The assets to be
acquired in the Acquisition include certain crude oil and produced
water gathering systems and transmission pipelines located in the
Williston Basin (the "Polar &
Divide system"). Subject to the achievement of certain
development milestones, SMLP will also have a six-month option to
acquire a crude oil transmission project currently under
development in the Williston Basin
(the "Stampede Lateral") from a subsidiary of Summit Investments
for an additional $35.0
million. The Acquisition is expected to close before
May 31, 2015.
![Summit Midstream Partners Logo. Summit Midstream Partners Logo.](http://photos.prnewswire.com/prnvar/20120927/MM82470LOGO)
SMLP also announced today its financial and operating
results for the three months ended March
31, 2015. SMLP reported adjusted EBITDA of
$50.0 million and adjusted
distributable cash flow of $36.0
million for the first quarter of 2015 compared to
$46.6 million and $34.3 million, respectively, for the first
quarter of 2014. SMLP reported net income of $1.7 million for the first quarter of 2015
compared to net income of $6.4
million for the first quarter of 2014. Volume
throughput averaged 1,583 million cubic feet per day ("MMcf/d") in
the first quarter of 2015 compared to 1,311 MMcf/d in the first
quarter of 2014, an increase of 20.7%, primarily due to increased
throughput on the Mountaineer Midstream, DFW Midstream, and Bison
Midstream systems.
Steve Newby, President and
Chief Executive Officer commented, "With today's announcement, SMLP
continues to execute its drop down strategy which includes more
than $800 million of drop down
transactions over the past two years. This
transaction will be immediately accretive to SMLP's
distributable cash flow on a per-unit basis, and is expected
to represent a source of growth and development opportunity for
SMLP for many years to come. In
addition to further diversifying SMLP by customer, commodities
handled, basins served, and services provided, this transaction
also broadens SMLP's operating capabilities with crude
oil and produced water gathering assets located in the Williston Basin with high-quality customers
such as Whiting Petroleum and SM
Energy.
SMLP reported strong first quarter 2015 operating and
financial performance reflecting record aggregate volume throughput
across our gathering systems, including higher year-over-year
volume throughput across our Marcellus Shale, Williston Basin, and Barnett Shale segments,
despite a weak commodity price backdrop. Our
quarterly financial results reflect the benefit from a highly
contracted and highly fee-based business model.
As a result of this strong quarterly financial performance, SMLP
delivered its tenth consecutive quarterly distribution increase to
unitholders, growing the first quarter 2015 distribution per
limited partner unit by 13.0% over the first quarter of 2014, while
generating a distribution coverage ratio of 1.01x."
Overview of the Polar & Divide
System
The Polar & Divide system includes
more than 295 miles of crude oil and produced water pipelines,
spanning throughout the central and western parts of Williams and Divide counties in North Dakota, from the Missouri River to the
Canadian border. The Polar & Divide system
is underpinned by long-term, fee-based gathering agreements with
multiple producers, including anchor customers, Whiting Petroleum
Corp. and SM Energy Company. Several of these
gathering agreements include rate redetermination mechanisms which
effectively serve to protect future cash flows by resetting the
gathering rate upward in the future in the event that the customer
does not attain certain minimum production thresholds.
The Polar & Divide system began operating in
May 2013 and currently has a maximum
aggregate throughput capacity of 80,000 barrels per day ("bbls/d")
of crude oil and produced water. In the first
quarter of 2015, the Polar & Divide system gathered over 48,000
bbls/d of crude oil and produced water from pad sites, central
receipt points, and truck unloading stations, an increase from
approximately 33,500 bbls/d for the year ended December 31, 2014. Crude oil
is currently delivered to the COLT Hub in Epping, North Dakota and produced water is
delivered to producer-owned and third-party injection wells located
throughout the Williston
Basin. Two development projects are currently
underway to provide customers of the Polar & Divide system with
additional delivery points for crude oil, including (i) an
interconnect with Enbridge's North Dakota Pipeline System, which is
included in the Acquisition, and (ii) the Stampede Lateral, which
is being developed by a subsidiary of Summit Investments to
interconnect with Global Partners LP's ("Global") Basin Columbus
rail terminal near Columbus, North
Dakota.
The Stampede Lateral is a greenfield development project
which includes the construction of a 46-mile, 10-inch diameter
crude oil transmission pipeline with throughput capacity of 50,000
bbls/d to Global's Basin Columbus rail terminal.
The Stampede Lateral is underpinned by a long-term contract with
Global, including minimum volume commitments, and is expected to be
placed into service in the fourth quarter of
2015. This project is expected to be acquired by
SMLP before the end of July
2015.
Based on 2016 projected EBITDA, SMLP is acquiring the
Polar & Divide system, assuming exercise of the $35.0 million Stampede Lateral option and
approximately $75 million of growth
capital expenditures through the fourth quarter of 2016, at a 7.8x
acquisition multiple.
The terms of the Acquisition were approved by the board of
directors of SMLP's general partner and by the board of directors'
conflicts committee, which consists entirely of independent
directors. The conflicts committee engaged
Evercore Partners to act as its independent financial advisor and
to render a fairness opinion, and Akin Gump Strauss Hauer &
Feld, LLP to act as its legal advisor.
Because of the common control aspects in a drop down
transaction, the Acquisition is expected to be deemed a transaction
between entities under common control and, as such, will be
accounted for on an "as if pooled" basis for all periods in which
common control existed. Upon closing the
Acquisition, SMLP's financial results will retrospectively include
the financial results attributable to the Polar & Divide system
for all periods beginning after February 15,
2013.
First Quarter 2015 Segment Financial
Results
Marcellus Shale
Segment
The Mountaineer Midstream gathering
system provides SMLP's midstream services for the Marcellus Shale
reportable segment. Segment adjusted EBITDA
totaled $6.5 million for the first
quarter of 2015, up 68.3% over the comparable period in 2014
primarily due to higher volume throughput across the Mountaineer
Midstream as well as MVC payments received in the first quarter of
2015 related to the recently completed Zinnia Loop
project. General and administrative ("G&A")
expenses totaled $0.1 million in the
first quarter of 2015 compared to $0.5
million in the first quarter of 2014. This lower G&A
expense is primarily related to a decision that SMLP made in the
first quarter of 2015 to discontinue allocating certain corporate
overhead expenses to the reportable segments, as had been our
practice in prior periods.
Volume throughput on the Mountaineer Midstream system
averaged 547 MMcf/d in the first quarter of 2015, up 91.3% over the
first quarter of 2014, and up 19.2% over the fourth quarter of
2014. Volumes throughput continued to increase
during the first quarter of 2015 as Antero Resources Corp.
continued to connect new wells upstream of the Mountaineer
Midstream system.
Williston Basin
Segment
The Bison Midstream gathering system
provides SMLP's midstream services for the Williston Basin reportable
segment. Segment adjusted EBITDA totaled
$5.3 million for the first quarter of
2015, up 14.1% over the comparable period in 2014 primarily due to
higher volume throughput across the Bison Midstream system,
partially offset by lower commodity prices.
Segment adjusted EBITDA for the first quarter of 2015 also
benefitted from the aforementioned decision by SMLP to discontinue
allocating certain corporate overhead expense to the reportable
segments in the first quarter of 2015.
Volume throughput on the Bison Midstream system averaged
18 MMcf/d in the first quarter of 2015, up 50.0% over the first
quarter of 2014, and down 18.2% from the fourth quarter of
2014. Volume throughput declined relative to the
fourth quarter of 2014 primarily due to system interruptions
associated with the commissioning of a new compressor station,
natural declines from existing wells and limited new drilling
activity during the quarter. Declining crude
oil, NGL and natural gas prices also negatively impacted the
margins associated with Bison Midstream's percent-of-proceeds
contracts during the first quarter of
2015.
Barnett Shale Segment
The DFW
Midstream gathering system provides SMLP's midstream services for
the Barnett Shale reportable segment. Segment
adjusted EBITDA totaled $16.8 million
for the first quarter of 2015, up 11.5% over the comparable period
in 2014 primarily due to higher volume
throughput. Segment adjusted EBITDA for the
first quarter of 2015 also benefitted from the aforementioned
decision by SMLP to discontinue allocating certain corporate
overhead expense to the reportable segments in the first quarter of
2015.
Volume throughput on the DFW Midstream system averaged 403
MMcf/d in the first quarter of 2015, up 15.8% over the comparable
period in 2014, and up 8.3% over the fourth quarter of
2014. Volume throughput growth was driven
primarily by the connection of new wells on several pad sites in
December 2014 that had been
temporarily shut-in for drilling and completion activities during
most of 2014.
Piceance Basin Segment
The Grand
River gathering system provides SMLP's midstream services for the
Piceance Basin reportable segment. Segment
adjusted EBITDA totaled $27.2 million
for the first quarter of 2015, up 6.5% over the comparable period
in 2014 primarily due to increased MVC shortfall payment
adjustments from certain of our Grand River customers and a full
quarter of cash flow contribution from the DeBeque Processing
Plant, which was commissioned in March
2014. Segment adjusted EBITDA for the
first quarter of 2015 also benefitted from the aforementioned
decision by SMLP to discontinue allocating certain corporate
overhead expense to the reportable segments in the first quarter of
2015.
Higher segment adjusted EBITDA in the first quarter of
2015 was negatively impacted by volume throughput declines and
lower realized condensate sales due to a weak commodity price
environment. Volume throughput for the Piceance
Basin segment averaged 615 MMcf/d in the first quarter of 2015,
down 7.5% from the first quarter of 2014 and down 3.6% from the
fourth quarter of 2014.
The majority of the gathering agreements for the Piceance
Basin segment include MVCs, which largely mitigate the financial
impact associated with declining volumes. As a
result, the lower volume throughput during the first quarter of
2015 translated primarily into larger MVC shortfall payments,
thereby minimizing the impact on adjusted EBITDA.
In addition, volume mix shifted from the first
quarter of 2014 to the first quarter of 2015 translating into a
higher average gathering rates per Mcf.
The following table presents average daily throughput by
reportable segment:
|
Three months ended
March 31,
|
|
|
|
2015
|
|
|
2014
|
|
|
|
Average daily throughput
(MMcf/d):
|
|
|
|
|
|
|
Marcellus Shale
|
547
|
|
|
286
|
|
|
Williston Basin
|
18
|
|
|
12
|
|
|
Barnett Shale
|
403
|
|
|
348
|
|
|
Piceance Basin
|
615
|
|
|
665
|
|
|
Total average daily throughput
|
1,583
|
|
|
1,311
|
|
|
MVC Shortfall Payments
SMLP billed
its customers $5.1 million of MVC shortfall payments
in the first quarter of 2015 because those customers did not meet
their MVCs. Certain of SMLP's natural gas
gathering agreements do not have credit banking mechanisms and as
such, the MVC shortfall payments from these customers are accounted
for as gathering revenue in the period that they are
earned. For the first quarter of 2015, SMLP
recognized $1.3 million of gathering revenue
associated with MVC shortfall payments from certain customers on
the Mountaineer, Grand River and DFW Midstream systems.
Of the billings for MVC shortfall payments,
$3.8 million was recorded as deferred
revenue on SMLP's balance sheet because these customers have the
ability to use these MVC shortfall payments to offset gathering
fees related to future throughput in excess of future period
MVCs. MVC shortfall payment adjustments in the
first quarter of 2015 totaled $8.6
million and included adjustments related to future
anticipated shortfall payments from certain customers on the Grand
River, Bison Midstream and DFW Midstream systems. The net impact of
these mechanisms increased adjusted EBITDA by $13.6
million in the first quarter of 2015.
|
Three months ended March 31,
2015
|
|
MVC
billings
|
|
|
Gathering revenue
|
|
Adjustments
to MVC
shortfall payments
|
|
Net impact
to adjusted EBITDA
|
|
(In thousands)
|
Net change in deferred revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Marcellus Shale
|
$
|
—
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Williston Basin
|
—
|
|
|
|
20
|
|
|
(20)
|
|
|
—
|
|
Barnett Shale
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Piceance Basin
|
3,773
|
|
|
|
—
|
|
|
3,773
|
|
|
3,773
|
|
Total net change in deferred
revenue
|
$
|
3,773
|
|
|
|
$
|
20
|
|
|
$
|
3,753
|
|
|
$
|
3,773
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MVC shortfall payment
adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Marcellus Shale
|
$
|
795
|
|
|
|
$
|
795
|
|
|
$
|
—
|
|
|
$
|
795
|
|
Williston Basin
|
—
|
|
|
|
—
|
|
|
2,680
|
|
|
2,680
|
|
Barnett Shale
|
35
|
|
|
|
35
|
|
|
(223)
|
|
|
(188)
|
|
Piceance Basin
|
448
|
|
|
|
448
|
|
|
6,130
|
|
|
6,578
|
|
Total MVC shortfall payment
adjustments
|
$
|
1,278
|
|
|
|
$
|
1,278
|
|
|
$
|
8,587
|
|
|
$
|
9,865
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
$
|
5,051
|
|
|
|
$
|
1,298
|
|
|
$
|
12,340
|
|
|
$
|
13,638
|
|
Capital Expenditures
For the three
months ended March 31, 2015, SMLP
recorded total capital expenditures of $11.9
million, including approximately $2.5
million of maintenance capital
expenditures. Development activities during the
first quarter of 2015 were related primarily to the ongoing
expansion of compression capacity on the Bison Midstream system and
pipeline construction projects to connect new receipt points on the
Grand River and Bison Midstream systems.
Capital & Liquidity
As of
March 31, 2015, SMLP had total
liquidity (cash plus undrawn borrowing capacity under its
$700.0 million revolving credit
facility) of $517.1
million. Based upon the terms of SMLP's
revolving credit facility and total outstanding debt of
$796.0 million, total leverage (net
debt divided by EBITDA) was approximately 3.9
to 1 as of March 31,
2015.
Revised 2015 Financial
Guidance
SMLP is revising its 2015 adjusted
EBITDA guidance from $195.0 million to
$210.0 million to a new range of $210.0 million to $225.0 million. This revised
financial guidance reflects the expected impact from the
Acquisition, including the impact of retrospectively pooling the
financial results of the Polar & Divide system for all periods
prior to closing the acquisition in 2015. We
expect that SMLP's as-reported adjusted EBITDA for the first
quarter of 2015 will increase by approximately $5.0 million as a result of pooling the
historical first quarter of 2015 financial results from the Polar
& Divide system.
SMLP's revised 2015 financial guidance excludes the effect
of any additional acquisitions from Summit Investments or third
parties.
Quarterly Distribution
On
April 23, 2015, the board of
directors of SMLP's general partner declared a quarterly cash
distribution of $0.565 per unit on
all outstanding common and subordinated units, or $2.26 per unit on an annualized basis, for the
quarter ended March 31,
2015. This distribution will be paid on
May 15, 2015 to unitholders of record
as of the close of business on May 8,
2015. This was SMLP's tenth consecutive quarterly
distribution increase and represents an increase of $0.065 per unit, or 13.0%, over the distribution
paid for the first quarter of 2014 and an increase of $0.005 per unit, or 0.9%, over the distribution
paid for the fourth quarter of 2014.
First Quarter 2015 Earnings Call
Information
SMLP will host a conference call at
9:00 a.m. Eastern on Thursday, May 7, 2015, to discuss its quarterly
operating and financial results.
Interested parties may participate in the call by dialing
847-619-6547 or toll-free 888-895-5271 and entering the passcode
39563498. The conference call will also
be webcast live and can be accessed through the
Investors section of SMLP's website at
www.summitmidstream.com.
A replay of the conference call will be
available until May 21, 2015 at
11:59 p.m. Eastern, and can be
accessed by dialing 888-843-7419 and entering the replay passcode
39563498#. An
archive of the conference call will also be available
on SMLP's website.
Use of Non-GAAP Financial
Measures
We report financial results in
accordance with U.S. generally accepted accounting principles
("GAAP"). We also present EBITDA, adjusted EBITDA, distributable
cash flow and adjusted distributable cash flow. We define EBITDA as
net income, plus interest expense, income tax expense, and
depreciation and amortization, less interest income and income tax
benefit. We define adjusted EBITDA as EBITDA
plus adjustments related to MVC shortfall payments, impairments and
other noncash expenses or losses, less other noncash income or
gains. We define distributable cash flow as
adjusted EBITDA plus cash interest income, less cash interest paid,
senior notes interest, cash taxes paid and maintenance capital
expenditures. We define adjusted distributable cash flow as
distributable cash flow plus or minus other unusual or
non-recurring expenses or income. Our definitions of these non-GAAP
financial measures may differ from the definitions of similar
measures used by other companies. Management
uses these non-GAAP financial measures in making financial,
operating and planning decisions and in evaluating our financial
performance. Furthermore, management believes that these non-GAAP
financial measures may provide users with additional meaningful
comparisons between current results and results of prior periods as
they are expected to be reflective of our core ongoing business.
These measures have limitations, and investors should not consider
them in isolation or as a substitute for analysis of our results as
reported under GAAP. Reconciliations of GAAP to
non-GAAP financial measures are attached to this
release.
Comparability Related to Drop Down
Transactions
With respect to drop down
transactions, SMLP's historical results of operations may not be
comparable to its future results of operations.
For example, SMLP acquired Red Rock Gathering from a
subsidiary of Summit Investments in March
2014. SMLP
accounted for the Red Rock Drop Down on an "as-if pooled" basis
because the transaction was executed by entities under common
control. As such, SMLP's
consolidated financial statements reflect Summit Investments' fair
value purchase accounting and the results of operations of Red Rock
Gathering since October 23, 2012 as
if SMLP had owned and operated during the common control
period.
About Summit Midstream Partners,
LP
SMLP is a growth-oriented limited
partnership focused on developing, owning and operating midstream
energy infrastructure assets that are strategically located in the
core producing areas of unconventional resource basins, primarily
shale formations, in North
America. SMLP currently provides natural gas gathering,
treating and processing services pursuant to primarily long-term
and fee-based natural gas gathering and processing agreements with
customers and counterparties in four unconventional resource
basins: (i) the Appalachian Basin, which includes the Marcellus
Shale formation in northern West
Virginia; (ii) the Williston Basin, which includes the Bakken and
Three Forks shale formations in northwestern North Dakota; (iii) the Fort Worth Basin, which includes the Barnett
Shale formation in north-central Texas; and (iv) the Piceance Basin, which
includes the Mesaverde formation as well as the Mancos and Niobrara shale formations in
western Colorado and eastern
Utah. SMLP owns and operates more
than 2,300 miles of pipeline and over
250,000 horsepower of compression. SMLP is headquartered in
The Woodlands, Texas with regional
corporate offices in Denver,
Colorado and Atlanta,
Georgia.
About Summit Midstream Partners,
LLC
Summit Midstream Partners, LLC ("Summit
Investments") indirectly owns a 49.4% limited partner interest in
SMLP and indirectly owns and controls the general partner of SMLP,
Summit Midstream GP, LLC, which has sole responsibility for
conducting the business and managing the operations of SMLP. Summit
Investments owns, operates and is developing various crude oil,
natural gas, and water-related midstream energy infrastructure
assets in the Bakken Shale in North
Dakota, the DJ Niobrara Shale in Colorado, and the Utica Shale in Ohio. Summit Investments also owns a 40%
interest in a joint venture that is developing natural gas
gathering and condensate stabilization infrastructure in the Utica
Shale in southeastern Ohio. Summit
Investments is a privately held company controlled by Energy
Capital Partners II, LLC, and certain of its affiliates.
Forward-Looking Statements
This
press release includes certain statements concerning expectations
for the future that are forward-looking within the meaning of the
federal securities laws. Forward-looking statements contain known
and unknown risks and uncertainties (many of which are difficult to
predict and beyond management's control) that may cause SMLP's
actual results in future periods to differ materially from
anticipated or projected results. An extensive
list of specific material risks and uncertainties affecting SMLP is
contained in its 2014 Annual Report on Form 10-K filed with the
Securities and Exchange Commission on March
2, 2015 and as amended and updated from time to time. Any
forward-looking statements in this press release are made as of the
date of this press release and SMLP undertakes no obligation to
update or revise any forward-looking statements to reflect new
information or events.
SUMMIT MIDSTREAM PARTNERS, LP AND
SUBSIDIARIES
|
UNAUDITED CONDENSED CONSOLIDATED BALANCE
SHEETS
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
2015
|
|
2014
|
|
(In thousands)
|
Assets
|
|
|
|
Current assets:
|
|
|
|
Cash and cash equivalents
|
$
|
13,096
|
|
|
$
|
26,428
|
|
Accounts receivable
|
44,069
|
|
|
83,612
|
|
Other current assets
|
2,371
|
|
|
3,289
|
|
Total current assets
|
59,536
|
|
|
113,329
|
|
Property, plant and equipment, net
|
1,234,229
|
|
|
1,235,652
|
|
Intangible assets, net
|
456,930
|
|
|
466,866
|
|
Goodwill
|
61,689
|
|
|
61,689
|
|
Other noncurrent assets
|
16,604
|
|
|
17,338
|
|
Total assets
|
$
|
1,828,988
|
|
|
$
|
1,894,874
|
|
|
|
|
|
Liabilities and Partners'
Capital
|
|
|
|
Current liabilities:
|
|
|
|
Trade accounts payable
|
$
|
10,466
|
|
|
$
|
12,852
|
|
Due to affiliate
|
826
|
|
|
2,711
|
|
Deferred revenue
|
2,377
|
|
|
2,377
|
|
Ad valorem taxes payable
|
3,882
|
|
|
8,717
|
|
Accrued interest
|
7,733
|
|
|
18,858
|
|
Other current liabilities
|
7,917
|
|
|
11,939
|
|
Total current liabilities
|
33,201
|
|
|
57,454
|
|
Long-term debt
|
796,000
|
|
|
808,000
|
|
Unfavorable gas gathering contract,
net
|
5,402
|
|
|
5,577
|
|
Deferred revenue
|
58,984
|
|
|
55,239
|
|
Other noncurrent liabilities
|
1,536
|
|
|
1,715
|
|
Total liabilities
|
895,123
|
|
|
927,985
|
|
|
|
|
|
Common limited partner capital
|
630,241
|
|
|
649,060
|
|
Subordinated limited partner
capital
|
279,524
|
|
|
293,153
|
|
General partner interests
|
24,100
|
|
|
24,676
|
|
Total partners' capital
|
933,865
|
|
|
966,889
|
|
Total liabilities and partners'
capital
|
$
|
1,828,988
|
|
|
$
|
1,894,874
|
|
SUMMIT MIDSTREAM PARTNERS, LP AND
SUBSIDIARIES
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
|
|
|
|
Three months ended
March 31,
|
|
2015
|
|
2014
|
|
(In thousands, except per-unit
amounts)
|
Revenues:
|
|
|
|
Gathering services and other fees
|
$
|
56,054
|
|
|
$
|
50,072
|
|
Natural gas, NGLs and condensate sales and
other
|
12,776
|
|
|
26,356
|
|
Amortization of favorable and unfavorable
contracts
|
(251)
|
|
|
(226)
|
|
Total revenues
|
68,579
|
|
|
76,202
|
|
|
|
|
|
Costs and expenses:
|
|
|
|
Cost of natural gas and NGLs
|
6,695
|
|
|
15,281
|
|
Operation and maintenance
|
17,429
|
|
|
19,181
|
|
General and administrative
|
8,351
|
|
|
7,886
|
|
Transaction costs
|
—
|
|
|
537
|
|
Depreciation and amortization
|
22,143
|
|
|
19,642
|
|
Total costs and expenses
|
54,618
|
|
|
62,527
|
|
Other income
|
1
|
|
|
1
|
|
Interest expense
|
(12,118)
|
|
|
(7,144)
|
|
Income before income taxes
|
1,844
|
|
|
6,532
|
|
Income tax expense
|
(177)
|
|
|
(159)
|
|
Net income
|
$
|
1,667
|
|
|
$
|
6,373
|
|
Less: net income attributable to Summit
Investments
|
—
|
|
|
2,828
|
|
Net income attributable to SMLP
|
1,667
|
|
|
3,545
|
|
Less: net income attributable to general partner,
including IDRs
|
1,568
|
|
|
431
|
|
Net income attributable to limited
partners
|
$
|
99
|
|
|
$
|
3,114
|
|
|
|
|
|
Earnings per limited partner
unit:
|
|
|
|
Common unit – basic
|
$
0.00
|
|
|
$
|
0.08
|
|
Common unit – diluted
|
$
0.00
|
|
|
$
|
0.08
|
|
Subordinated unit – basic and
diluted
|
$
0.00
|
|
|
$
|
0.02
|
|
|
|
|
|
Weighted-average limited partner units
outstanding:
|
|
|
|
Common units – basic
|
34,439
|
|
|
29,912
|
|
Common units – diluted
|
34,585
|
|
|
30,068
|
|
Subordinated units – basic and
diluted
|
24,410
|
|
|
24,410
|
|
SUMMIT MIDSTREAM PARTNERS, LP AND
SUBSIDIARIES
|
UNAUDITED OTHER FINANCIAL AND OPERATING
DATA
|
|
|
|
Three months ended
March 31,
|
|
2015
|
|
2014
|
|
(Dollars in thousands)
|
Other financial data:
|
|
|
|
EBITDA (1)
|
$
|
36,355
|
|
|
$
|
33,543
|
|
Adjusted EBITDA (1)
|
$
|
50,007
|
|
|
$
|
46,619
|
|
Capital expenditures
|
$
|
11,914
|
|
|
$
|
40,100
|
|
Acquisitions of gathering systems
(2)
|
$
|
2,941
|
|
|
$
|
305,000
|
|
Distributable cash flow (1)
|
$
|
35,902
|
|
|
$
|
33,733
|
|
Adjusted distributable cash flow
|
$
|
36,005
|
|
|
$
|
34,270
|
|
Distributions declared
|
$
|
35,526
|
|
|
$
|
30,384
|
|
Distribution coverage ratio (3)
|
1.01x
|
|
|
|
|
|
|
|
Operating data:
|
|
|
|
Miles of pipeline (end of period)
|
2,347
|
|
2,294
|
Aggregate average throughput
(MMcf/d)
|
1,583
|
|
1,311
|
|
|
(1)
|
Includes transaction
costs. These unusual expenses are settled in cash.
|
(2)
|
Reflects cash paid
(including working capital adjustments) and value of units issued,
if any, to fund acquisitions.
|
(3)
|
Distribution coverage
ratio calculation for the three months ended March 31, 2015 is
based on distributions in respect of the first quarter of
2015. Represents the ratio
of adjusted distributable cash flow to distributions declared. Due
to the common control nature of drop down transactions, prior
period results are reported on an as if pooled basis which results
in adjustments to previously reported adjusted distributable cash
flow with no adjustment to distributions declared. As such, we do not present historical
distribution coverage ratios.
|
SUMMIT MIDSTREAM PARTNERS, LP AND
SUBSIDIARIES
|
UNAUDITED RECONCILIATIONS TO NON-GAAP FINANCIAL
MEASURES
|
|
|
|
Three months ended
March 31,
|
|
2015
|
|
2014
|
|
(Dollars in thousands)
|
Reconciliations of Net Income to EBITDA, Adjusted
EBITDA, Distributable Cash Flow and Adjusted Distributable Cash
Flow:
|
|
|
|
Net income
|
$
|
1,667
|
|
|
$
|
6,373
|
|
Add:
|
|
|
|
Interest expense
|
12,118
|
|
|
7,144
|
|
Income tax expense
|
177
|
|
|
159
|
|
Depreciation and amortization
|
22,143
|
|
|
19,642
|
|
Amortization of favorable and unfavorable
contracts
|
251
|
|
|
226
|
|
Less:
|
|
|
|
Interest income
|
1
|
|
|
1
|
|
EBITDA
|
$
|
36,355
|
|
|
$
|
33,543
|
|
Add:
|
|
|
|
Adjustments related to MVC shortfall payments
(1)
|
12,340
|
|
|
12,013
|
|
Unit-based compensation
|
1,312
|
|
|
1,063
|
|
Adjusted EBITDA
|
$
|
50,007
|
|
|
$
|
46,619
|
|
Add:
|
|
|
|
Cash interest received
|
1
|
|
|
1
|
|
Less:
|
|
|
|
Cash interest paid
|
22,812
|
|
|
14,308
|
|
Senior notes interest (2)
|
(11,171)
|
|
|
(6,500)
|
|
Maintenance capital expenditures
|
2,465
|
|
|
5,079
|
|
Distributable cash flow
|
$
|
35,902
|
|
|
$
|
33,733
|
|
Add:
|
|
|
|
Transaction costs
|
—
|
|
|
537
|
|
Regulatory compliance costs (3)
|
103
|
|
|
—
|
|
Adjusted distributable cash flow
|
$
|
36,005
|
|
|
$
|
34,270
|
|
|
|
|
|
Distributions declared
|
$
|
35,526
|
|
|
$
|
30,384
|
|
|
|
|
|
Distribution coverage ratio (4)
|
1.01x
|
|
|
|
|
|
(1)
|
Adjustments related
to MVC shortfall payments account for (i) the net increases or
decreases in deferred revenue for MVC shortfall payments and (ii)
our inclusion of future expected annual MVC shortfall
payments.
|
(2)
|
Senior notes interest
represents the net of interest expense accrued and paid during the
period. Interest on the $300.0 million 5.5% senior notes is paid in
cash semi-annually in arrears on February 15 and August 15 until
maturity in August 2022. Interest on the $300.0 million 7.5% senior
notes is paid in cash semi-annually in arrears on January 1 and
July 1 until maturity in July 2021.
|
(3)
|
We incurred expenses
associated with our adoption of the 2013 Internal
Control–Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission ("COSO 2013"). These
first-year COSO 2013 expenses are not expected to be incurred
subsequent to completion of the 2014 integrated audit in March
2015.
|
(4)
|
Distribution coverage
ratio calculation for the three months ended March 31, 2015 is
based on distributions in respect of the first quarter of
2015. Represents the ratio
of adjusted distributable cash flow to distributions declared. Due
to the common control nature of drop down transactions, prior
period results are reported on an as if pooled basis which results
in adjustments to previously reported adjusted distributable cash
flow with no adjustment to distributions declared. As such, we do not present historical
distribution coverage ratios.
|
SUMMIT MIDSTREAM PARTNERS, LP AND
SUBSIDIARIES
|
UNAUDITED RECONCILIATION OF SEGMENT ADJUSTED
EBITDA TO ADJUSTED EBITDA
|
|
|
|
Three months ended
March 31,
|
|
2015
|
|
2014
|
|
(In thousands)
|
Reportable segment adjusted
EBITDA:
|
|
|
|
Marcellus Shale
|
$
|
6,535
|
|
|
$
|
3,883
|
|
Williston Basin
|
5,333
|
|
|
4,676
|
|
Barnett Shale
|
16,760
|
|
|
15,034
|
|
Piceance Basin
|
27,236
|
|
|
25,581
|
|
Total reportable segment adjusted
EBITDA
|
55,864
|
|
|
49,174
|
|
Allocated corporate expenses
|
(5,857)
|
|
|
(2,555)
|
|
Adjusted EBITDA
|
$
|
50,007
|
|
|
$
|
46,619
|
|
Logo -
http://photos.prnewswire.com/prnh/20120927/MM82470LOGO
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/summit-midstream-partners-lp-announces-2550-million-drop-down-acquisition-and-reports-first-quarter-2015-financial-results-300078906.html
SOURCE Summit Midstream Partners, LP