- 1Q 2017 Net Income of $634 Million, Up
$584 Million
- 1Q 2017 Adjusted EBITDA of $1.117
Billion, Up 5.4%
- Cash Distribution Coverage Ratio of
1.33x
- Announced Agreement to Sell Its
Interests in Geismar Plant for $2.1 Billion and to Provide
Feedstock to Plant Buyer via Long-Term Supply and Transportation
Agreements
- Williams Partners Analyst Day Set for
May 11
Williams Partners L.P. (NYSE: WPZ) today announced its financial
results for the three months ended March 31, 2017.
Summary Financial Information
1Q
Amounts in millions, except per-unit
amounts. Per-unit amounts are reported on a diluted basis. All
amounts are attributable to Williams Partners L.P.
2017 2016 (Unaudited) GAAP Measures Net income
(loss) $ 634 $ 50 Net income (loss) per common unit $ 0.68 ($0.25 )
Cash Flow from Operations $ 731 $ 924 Non-GAAP Measures (1)
Adjusted EBITDA $ 1,117 $ 1,060 DCF attributable to partnership
operations $ 752 $ 739 Cash distribution coverage ratio 1.33x 1.02x
(1) Adjusted EBITDA, distributable cash flow (DCF) and cash
distribution coverage ratio are non-GAAP measures. Reconciliations
to the most relevant measures included in GAAP are attached to this
news release.
First-Quarter 2017 Financial Results
Williams Partners reported unaudited first-quarter 2017 net
income attributable to controlling interests of $634 million, a
$584 million increase over first-quarter 2016. The favorable change
was driven by a $271 million increase in investing income,
primarily associated with a transaction involving certain
joint-venture interests, as well as a $141 million improvement in
operating income and the absence of $112 million of impairments of
equity-method investments in 2016.
Williams Partners reported first-quarter 2017 Cash Flow from
Operations (CFFO) of $731 million, a $193 million decrease from
first-quarter 2016. The decrease from the prior year is driven by
the absence of $198 million of cash received in 2016 associated
with minimum volume commitments, which were replaced by contract
restructurings that occurred in the latter part of 2016. The prior
year also included $80 million of cash received as a milestone
payment associated with Transco’s Hillabee expansion project. These
unfavorable changes in CFFO were partially offset by improved
operating results.
Williams Partners reported first-quarter 2017 Adjusted EBITDA of
$1.117 billion, a $57 million increase over first-quarter 2016. The
increase is due primarily to $37 million higher commodity margins
and $30 million lower operating and maintenance (O&M) and
selling, general and administrative (SG&A) expenses, and a $16
million favorable change in other income and expense primarily
related to our former Canadian operations which were sold in
September 2016. Partially offsetting these increases was a $30
million decrease in fee-revenues due primarily to lower West
segment results, partially offset by increases in the Atlantic-Gulf
segment.
Distributable Cash Flow and Distributions
For first-quarter 2017, Williams Partners generated $752 million
in distributable cash flow (DCF) attributable to partnership
operations, compared with $739 million in DCF attributable to
partnership operations for first-quarter 2016. The increase is due
primarily to the previously described improvement in the quarter’s
Adjusted EBITDA and $17 million lower interest expense. DCF has
been reduced by $58 million for the planned removal of non-cash
deferred revenue amortization associated with the fourth-quarter
2016 contract restructuring in the Barnett Shale and Mid-Continent
region. For first-quarter 2017, the cash distribution coverage
ratio was 1.33x.
Williams Partners recently announced a regular quarterly cash
distribution of $0.60 per unit, payable May 12, 2017 to its common
unitholders of record at the close of business on May 5, 2017.
CEO Perspective
Alan Armstrong, chief executive officer of Williams Partners’
general partner, made the following comments:
“We continue to differentiate ourselves with a focused strategy
on natural gas infrastructure in support of consistent and
sustainable growth in gas volumes. We continue to deliver top
quartile EBITDA growth among our peers as we increased
year-over-year Adjusted EBITDA for the 14th quarter in a row. This
quarter, our growth was delivered despite some significant impacts
from third-party outages and more extreme weather in the Rockies
area, proving once again the resiliency of our business model.
“Our project teams continued to deliver as we brought on the 1.2
Bcf/D Gulf Trace project ahead of schedule and under budget. That
is just one of five Transco pipeline system expansions that we
expect to place in service in 2017. Our successful 2016 work to
bring the Gunflint and Kodiak tiebacks in service was showcased
this quarter by Atlantic-Gulf’s higher volumes and higher fee-based
revenues. And our backlog of projects continues to grow as we had a
very successful Southeastern Trail open season in the quarter as
well.
“We continue to strengthen our foundation for long-term,
sustainable growth in our core business, as highlighted by the
recently announced agreement to sell our interests in the Geismar
olefins facility while gaining a new third party fee-based revenue
stream for our Bayou Ethane system. With the expected sale of
Geismar, and the sale of our Canadian business in late 2016, we’ll
realize around 97 percent of our gross margins coming from
predictable, fee-based sources.
“Our consolidation of operating areas from five to three became
effective in first-quarter 2017 – not only streamlining our
organization, but helping us continue the cost-savings momentum we
began in the second quarter of last year. We expect to realize
further cost savings through the consolidation of offices and
systems.”
Business Segment Results
Effective, Jan. 1, 2017, Williams Partners implemented certain
changes in its reporting segments as part of an operational
realignment. As a result beginning with the reporting of
first-quarter 2017 financial results, Williams Partners operations
will be comprised of the following reportable segments:
Atlantic-Gulf, West, Northeast G&P, and NGL & Petchem
Services.
Williams
Partners Modified and Adjusted EBITDA Amounts in
millions
1Q 2017 1Q 2017 1Q 2016
1Q 2016
ModifiedEBITDA
Adjust.
AdjustedEBITDA
ModifiedEBITDA
Adjust.
AdjustedEBITDA
Atlantic-Gulf $ 450 $ 3 $ 453 $ 382 $ 23 $ 405 West 385 4 389 327
73 400 Northeast G&P 226 1 227 220 5 225 NGL & Petchem
Services 51 (2 ) 49 26 4 30 Other 20 (21 ) (1
) - - - Total
$
1,132 ($15 )
$ 1,117 $
955 $ 105 $
1,060 Definitions of modified EBITDA and adjusted
EBITDA and schedules reconciling these measures to net income are
included in this news release.
Atlantic-Gulf
This segment includes the partnership’s interstate natural gas
pipeline, Transco, and significant natural gas gathering and
processing and crude oil production handling and transportation
assets in the Gulf Coast region, including a 51 percent interest in
Gulfstar One (a consolidated entity), which is a proprietary
floating production system, and various petrochemical and feedstock
pipelines in the Gulf Coast region, as well as a 50 percent
equity-method investment in Gulfstream, a 41 percent interest in
Constitution (a consolidated entity) which is under development,
and a 60 percent equity-method investment in Discovery.
The Atlantic-Gulf segment reported Modified EBITDA of $450
million for first-quarter 2017, compared with $382 million for
first-quarter 2016. Adjusted EBITDA increased by $48 million to
$453 million for the same time period. The increase in both
measures was driven primarily by higher fee-based revenues due
primarily to contributions from offshore expansion projects
completed during 2016 and new Transco projects Rock Springs (in
service in August 2016) and Gulf Trace (in service in February
2017). Also contributing to the increase in both measures were $12
million improved commodity margins. Partially offsetting these
increases were increased O&M expenses due primarily to higher
costs associated with Transco’s integrity and pipeline maintenance
program.
West
This segment includes the partnership’s interstate natural gas
pipeline, Northwest Pipeline, and natural gas gathering,
processing, and treating operations in New Mexico, Colorado, and
Wyoming, as well as the Barnett Shale region of north-central
Texas, the Eagle Ford Shale region of south Texas, the Haynesville
Shale region of northwest Louisiana, and the Mid-Continent region
which includes the Anadarko, Arkoma, Delaware and Permian basins.
This reporting segment also includes an NGL and natural gas
marketing business, storage facilities, and undivided 50 percent
interest in an NGL fractionator near Conway, Kansas, and a 50
percent equity-method investment in OPPL. The partnership completed
the disposal of its 50 percent equity-method investment in a
Delaware Basin gas gathering system in the Mid-Continent region
during first-quarter 2017.
The West segment reported Modified EBITDA of $385 million for
first-quarter 2017, compared with $327 million for first-quarter
2016. Adjusted EBITDA of $389 million is $11 million lower than the
same period in 2016. The increase in Modified EBITDA was driven
primarily by $35 million lower O&M and SG&A expenses and
$21 million higher commodity margins. The Adjusted EBITDA decrease
was due primarily to $57 million lower fee-based revenues including
$25 million lower fee-based revenues in the Barnett from lower
volumes and contract changes that occurred during 2016. Fee-based
revenues were also impacted by more extreme weather in 2017.
Northeast G&P
This segment includes the partnership’s natural gas gathering
and processing, compression and NGL fractionation businesses in the
Marcellus Shale region primarily in Pennsylvania, New York, and
West Virginia and Utica Shale region of eastern Ohio, as well as a
66 percent interest in Cardinal (a consolidated entity), a 62
percent equity-method investment in UEOM, a 69 percent
equity-method investment in Laurel Mountain, a 58 percent
equity-method investment in Caiman II, and Appalachia Midstream
Services, LLC, which owns an approximate average 66 percent
equity-method investment in multiple gas gathering systems in the
Marcellus Shale (Appalachia Midstream Investments).
The Northeast G&P segment reported Modified EBITDA of $226
million for first-quarter 2017, compared with $220 million for
first-quarter 2016. Adjusted EBITDA increased $2 million to $227
million. The increase in both measures was due primarily to lower
SG&A expenses. Fee-based revenues and proportional EBITDA from
joint ventures were stable between the two periods due to increases
in the Bradford, Susquehanna and Ohio River systems that offset
decreases in the Utica.
NGL & Petchem Services
This segment includes the partnership’s 88.46 percent undivided
interest in an olefins production facility in Geismar, Louisiana,
along with a refinery grade propylene splitter. On April 17, 2017,
the partnership announced an agreement to sell the subsidiary that
owns its interests in the Geismar olefins production facility.
Prior to September 2016, this reporting segment also included an
oil sands offgas processing plant near Fort McMurray, Alberta, and
an NGL/olefin fractionation facility, which were subsequently
sold.
The NGL & Petchem Services segment reported Modified EBITDA
of $51 million for first-quarter 2017, compared with $26 million
for first-quarter 2016. Adjusted EBITDA increased by $19 million to
$49 million. The increase in both measures was due primarily to a
favorable change in other income and expense related to our former
Canadian operations, which were sold in September 2016.
Additionally, lower O&M and SG&A expenses positively
impacted the quarter. Ethylene margins were stable between the two
periods due to favorable 2017 per-unit ethylene margins offsetting
lower 2017 production volumes caused by an unexpected power outage
and related repair activities. The unplanned shutdown and
subsequent repair work resulted in the Geismar olefins plant being
offline from March 12 until restarting on April 18, 2017. For
first-quarter 2017, the Geismar plant contributed approximately $37
million in Adjusted EBITDA.
Notable Recent Events
On March 30, 2017, Williams Partners announced that it had
completed separate transactions with Western Gas Partners, LP
(NYSE: WES) (“Western Gas”), Anadarko Petroleum Corporation (NYSE:
APC) (“Anadarko”), and Energy Transfer Partners, L.P. (NYSE: ETP)
(“Energy Transfer”), and certain of their respective affiliates,
for an aggregate cash consideration of $200 million paid to
Williams Partners and an increase in Williams Partners’ ownership
in two Marcellus shale gathering systems, in exchange for Williams
Partners’ assignment of interests in certain non-operated Delaware
Basin assets.
On April 17, 2017, Williams Partners announced that it has
agreed to sell 100 percent of its membership interests in Williams
Olefins LLC, which owns an 88.46 percent undivided ownership
interest in the Geismar, Louisiana, olefins plant and associated
complex, to NOVA Chemicals for $2.1 billion in cash. The
transaction is expected to close in summer 2017. Closing is subject
to customary closing conditions and regulatory approvals.
Additionally, upon closing of the transaction, Williams Partners
subsidiaries will enter into long-term supply and transportation
agreements with NOVA Chemicals to provide feedstock to the Geismar
olefins plant via Williams Partners’ ethane pipeline system in the
U.S. Gulf Coast. These agreements will secure a meaningful
long-term fee-based revenue stream for the partnership.
Williams Partners, Williams Analyst Day Set for May
11
Williams Partners and Williams are scheduled to host their 2017
Analyst Day event May 11. During the event, Williams’ management
will give in-depth presentations covering all of the partnership’s
and company’s energy infrastructure businesses and update certain
aspects of its financial guidance. This year’s Analyst Day meeting
is scheduled from approximately 8:00 a.m. to 2:00 p.m. EDT.
Presentation slides along with a link to the live webcast will
be accessible at www.williams.com the morning of May 11. A replay
of the Analyst Day webcast will be available on the website for at
least 90 days following the event.
Williams Partners’ First-Quarter 2017 Materials to be Posted
Shortly; Q&A Webcast Scheduled for Tomorrow
Williams Partners’ first-quarter 2017 financial results package
will be posted shortly at www.williams.com. The materials will
include the analyst package.
Williams Partners and Williams will host a joint Q&A live
webcast on Thursday, May 4 at 9:30 a.m. EDT. A limited number of
phone lines will be available at (877) 741-4253. International
callers should dial (719) 325-4783. The conference ID is 2089672. A
link to the webcast, as well as replays of the webcast, will be
available for at least 90 days following the event at
www.williams.com.
Form 10-Q
The partnership plans to file its first-quarter 2017 Form 10-Q
with the Securities and Exchange Commission (SEC) this week. Once
filed, the document will be available on both the SEC and Williams
Partners websites.
Definitions of Non-GAAP Measures
This news release may include certain financial measures –
Adjusted EBITDA, distributable cash flow and cash distribution
coverage ratio – that are non-GAAP financial measures as defined
under the rules of the SEC.
Our segment performance measure, Modified EBITDA, is defined as
net income (loss) before income tax expense, net interest expense,
equity earnings from equity-method investments, other net investing
income, impairments of equity investments and goodwill,
depreciation and amortization expense, and accretion expense
associated with asset retirement obligations for nonregulated
operations. We also add our proportional ownership share (based on
ownership interest) of Modified EBITDA of equity-method
investments.
Adjusted EBITDA further excludes items of income or loss that we
characterize as unrepresentative of our ongoing operations.
Management believes these measures provide investors meaningful
insight into results from ongoing operations.
We define distributable cash flow as Adjusted EBITDA less
maintenance capital expenditures, cash portion of interest expense,
income attributable to noncontrolling interests and cash income
taxes, plus WPZ restricted stock unit non-cash compensation expense
and certain other adjustments that management believes affects the
comparability of results. Adjustments for maintenance capital
expenditures and cash portion of interest expense include our
proportionate share of these items of our equity-method
investments.
We also calculate the ratio of distributable cash flow to the
total cash distributed (cash distribution coverage ratio). This
measure reflects the amount of distributable cash flow relative to
our cash distribution. We have also provided this ratio using the
most directly comparable GAAP measure, net income (loss).
This news release is accompanied by a reconciliation of these
non-GAAP financial measures to their nearest GAAP financial
measures. Management uses these financial measures because they are
accepted financial indicators used by investors to compare company
performance. In addition, management believes that these measures
provide investors an enhanced perspective of the operating
performance of the Partnership's assets and the cash that the
business is generating.
Neither Adjusted EBITDA nor distributable cash flow are intended
to represent cash flows for the period, nor are they presented as
an alternative to net income or cash flow from operations. They
should not be considered in isolation or as substitutes for a
measure of performance prepared in accordance with United States
generally accepted accounting principles.
About Williams Partners
Williams Partners is an industry-leading, large-cap natural gas
infrastructure master limited partnership with a strong growth
outlook and major positions in key U.S. supply basins. Williams
Partners has operations across the natural gas value chain from
gathering, processing and interstate transportation of natural gas
and natural gas liquids to petchem production of ethylene,
propylene and other olefins. Williams Partners owns and operates
more than 33,000 miles of pipelines system wide – including the
nation’s largest volume and fastest growing pipeline – providing
natural gas for clean-power generation, heating and industrial use.
Williams Partners’ operations touch approximately 30 percent of
U.S. natural gas. Tulsa, Okla.-based Williams (NYSE: WMB), a
premier provider of large-scale U.S. natural gas infrastructure,
owns approximately 74 percent of Williams Partners.
Forward-Looking Statements
The reports, filings, and other public announcements of Williams
Partners L.P. (WPZ) may contain or incorporate by reference
statements that do not directly or exclusively relate to historical
facts. Such statements are “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as
amended (Securities Act) and Section 21E of the Securities
Exchange Act of 1934, as amended (Exchange Act). These
forward-looking statements relate to anticipated financial
performance, management’s plans and objectives for future
operations, business prospects, outcome of regulatory proceedings,
market conditions and other matters.
All statements, other than statements of historical facts,
included in this report that address activities, events or
developments that we expect, believe or anticipate will exist or
may occur in the future, are forward-looking statements.
Forward-looking statements can be identified by various forms of
words such as “anticipates,” “believes,” “seeks,” “could,” “may,”
“should,” “continues,” “estimates,” “expects,” “forecasts,”
“intends,” “might,” “goals,” “objectives,” “targets,” “planned,”
“potential,” “projects,” “scheduled,” “will,” “assumes,”
“guidance,” “outlook,” “in service date” or other similar
expressions. These forward-looking statements are based on
management’s beliefs and assumptions and on information currently
available to management and include, among others, statements
regarding:
- Expected levels of cash distributions
to limited partner interests;
- Our and our affiliates’ future credit
ratings;
- Amounts and nature of future capital
expenditures;
- Expansion and growth of our business
and operations;
- Financial condition and liquidity;
- Business strategy;
- Cash flow from operations or results of
operations;
- Seasonality of certain business
components;
- Natural gas, natural gas liquids, and
olefins prices, supply, and demand;
- Demand for our services.
Forward-looking statements are based on numerous assumptions,
uncertainties and risks that could cause future events or results
to be materially different from those stated or implied in this
report. Many of the factors that will determine these results are
beyond our ability to control or predict. Specific factors that
could cause actual results to differ from results contemplated by
the forward-looking statements include, among others, the
following:
- Whether we will produce sufficient cash
flows to provide the level of cash distributions that Williams
expects;
- Whether we elect to pay expected levels
of cash distributions;
- Whether we will be able to effectively
execute our financing plan including the receipt of anticipated
levels of proceeds from planned asset sales;
- Whether Williams will be able to
effectively manage the transition in its board of directors and
management as well as successfully execute its business
restructuring;
- Availability of supplies, including
lower than anticipated volumes from third parties served by our
midstream business, and market demand;
- Volatility of pricing including the
effect of lower than anticipated energy commodity prices and
margins;
- Inflation, interest rates, and general
economic conditions (including future disruptions and volatility in
the global credit markets and the impact of these events on
customers and suppliers);
- The strength and financial resources of
our competitors and the effects of competition;
- Whether we are able to successfully
identify, evaluate, and timely execute our capital projects and
other investment opportunities in accordance with our forecasted
capital expenditures budget;
- Our ability to successfully expand our
facilities and operations;
- Development of alternative energy
sources;
- The impact of operational and
developmental hazards, unforeseen interruptions, and the
availability of adequate coverage for such interruptions;
- The impact of existing and future laws,
regulations, the regulatory environment, environmental liabilities,
and litigation as well as our ability to obtain permits and achieve
favorable rate proceeding outcomes;
- Williams’ costs and funding obligations
for defined benefit pension plans and other postretirement benefit
plans;
- Our allocated costs for defined benefit
pension plans and other postretirement benefit plans sponsored by
our affiliates;
- Changes in maintenance and construction
costs;
- Changes in the current geopolitical
situation;
- Our exposure to the credit risk of our
customers and counterparties;
- Risks related to financing, including
restrictions stemming from debt agreements, future changes in
credit ratings as determined by nationally-recognized credit rating
agencies and the availability and cost of capital;
- The amount of cash distributions from
and capital requirements of our investments and joint ventures in
which we participate;
- Risks associated with weather and
natural phenomena, including climate conditions and physical damage
to our facilities;
- Acts of terrorism, including
cybersecurity threats and related disruptions;
- Additional risks described in our
filings with the Securities and Exchange Commission (SEC).
Given the uncertainties and risk factors that could cause our
actual results to differ materially from those contained in any
forward-looking statement, we caution investors not to unduly rely
on our forward-looking statements. We disclaim any obligations to
and do not intend to update the above list or announce publicly the
result of any revisions to any of the forward-looking statements to
reflect future events or developments.
In addition to causing our actual results to differ, the factors
listed above and referred to below may cause our intentions to
change from those statements of intention set forth in this report.
Such changes in our intentions may also cause our results to
differ. We may change our intentions, at any time and without
notice, based upon changes in such factors, our assumptions, or
otherwise.
Limited partner units are inherently different from the capital
stock of a corporation, although many of the business risks to
which we are subject are similar to those that would be faced by a
corporation engaged in a similar business. You should carefully
consider the risk factors discussed above in addition to the other
information in this report. If any of such risks were actually to
occur, our business, results of operations, and financial condition
could be materially adversely affected. In that case, we might not
be able to pay distributions on our common units, the trading price
of our common units could decline, and unitholders could lose all
or part of their investment.
Because forward-looking statements involve risks and
uncertainties, we caution that there are important factors, in
addition to those listed above, that may cause actual results to
differ materially from those contained in the forward-looking
statements. For a detailed discussion of those factors, see Part I,
Item 1A. Risk Factors in our Annual Report on Form 10-K filed with
the SEC on Feb. 22, 2017.
Williams Partners L.P.
Reconciliation of Non-GAAP Measures (UNAUDITED)(UNAUDITED)
2016 2017 (Dollars in millions, except coverage ratios)
1st Qtr 2nd Qtr 3rd Qtr
4th Qtr Year 1st Qtr
Williams Partners L.P.
Reconciliation of GAAP "Net Income (Loss)"
to Non-GAAP "Modified EBITDA," "Adjusted EBITDA," and
"Distributable cash flow”
Net income (loss) $ 79 $ (77 ) $ 351 $ 166 $ 519 $ 660
Provision (benefit) for income taxes 1 (80 ) (6 ) 5 (80 ) 3
Interest expense 229 231 229 227 916 214 Equity (earnings) losses
(97 ) (101 ) (104 ) (95 ) (397 ) (107 ) Impairment of equity-method
investments 112 — — 318 430 — Other investing (income) loss — (1 )
(28 ) — (29 ) (271 ) Proportional Modified EBITDA of equity-method
investments 189 191 194 180 754 194 Depreciation and amortization
expenses 435 432 426 427 1,720 433
Accretion for asset retirement obligations
associated with nonregulated operations
7 9
8 7 31
6 Modified EBITDA 955 604 1,070 1,235 3,864
1,132 Adjustments Estimated minimum volume commitments 60 64
70 (194 ) — 15 Severance and related costs 25 — — 12 37 9 Potential
rate refunds associated with rate case litigation 15 — — — 15 —
Merger and transition related expenses 5 — — — 5 — Constitution
Pipeline project development costs — 8 11 9 28 2 Share of
impairment at equity-method investment — — 6 19 25 — Geismar
Incident adjustment for insurance and timing — — — (7 ) (7 ) (9 )
Impairment of certain assets — 389 — 22 411 — Organizational
realignment-related costs — — — 24 24 4 Loss related to Canada
disposition — — 32 2 34 (3 ) Gain on asset retirement — — — (11 )
(11 ) — Gains from contract settlements and terminations — — — — —
(13 ) Accrual for loss contingency — — — — — 9 Gain on early
retirement of debt — — — — — (30 ) Expenses associated with
strategic asset monetizations —
— — 2
2 1 Total EBITDA
adjustments 105 461
119 (122 )
563 (15 ) Adjusted EBITDA 1,060 1,065
1,189 1,113 4,427 1,117 Maintenance capital expenditures (1)
(58 ) (75 ) (121 ) (147 ) (401 ) (53 ) Interest expense (cash
portion) (2) (241 ) (245 ) (244 ) (239 ) (969 ) (224 ) Cash taxes —
— — (3 ) (3 ) (5 ) Income attributable to noncontrolling interests
(3) (29 ) (13 ) (31 ) (27 ) (100 ) (27 ) WPZ restricted stock unit
non-cash compensation 7 5 2 2 16 2 Amortization of deferred revenue
associated with certain 2016 contract restructurings —
— —
— —
(58 ) Distributable cash flow attributable to Partnership
Operations (4) 739 737
795 699
2,970 752 Total
cash distributed (5) $ 725 $ 725 $ 734 $ 762 $ 2,946 $ 567
Coverage ratios: Distributable cash flow attributable to
partnership operations divided by Total cash distributed
1.02 1.02
1.08 0.92
1.01 1.33 Net income (loss) divided by
Total cash distributed 0.11
(0.11 ) 0.48 0.22
0.18 1.16
Notes: (1) Includes proportionate share of maintenance
capital expenditures of equity investments. (2) Includes
proportionate share of interest expense of equity investments.
(3) Excludes allocable share of certain EBITDA adjustments.
(4) The fourth quarter of 2016 includes income of $183
million associated with proceeds from the contract restructuring in
the Barnett Shale and Mid-Continent region as the cash was received
during 2016. (5) In order to exclude the impact of the IDR
waiver associated with the WPZ merger termination fee from the
determination of coverage ratios, cash distributions have been
increased by $10 million in the first quarter of 2016. Cash
distributions for the third quarter of 2016 have been increased to
exclude the impact of the $150 million IDR waiver associated with
the sale of our Canadian operations. Cash distributions for the
fourth quarter of 2016 and the first quarter of 2017 have been
decreased by $50 million and $6 million, respectively, to reflect
the amount paid by WMB to WPZ pursuant to the January 2017 Common
Unit Purchase Agreement.
Williams
Partners L.P. Reconciliation of Non-GAAP “Modified EBITDA”
to Non-GAAP “Adjusted EBITDA” (UNAUDITED) 2016* 2017 (Dollars
in millions) 1st Qtr 2nd Qtr
3rd Qtr 4th Qtr Year 1st Qtr
Modified
EBITDA: Northeast G&P $ 220 $ 222 $ 214 $ 197 $ 853 $ 226
Atlantic-Gulf 382 360 423 456 1,621 450 West 327 312 363 542 1,544
385 NGL & Petchem Services 26 (290 ) 70 49 (145 ) 51 Other
— — —
(9 ) (9 ) 20
Total Modified EBITDA $ 955
$ 604 $
1,070 $ 1,235
$ 3,864 $ 1,132
Adjustments:
Northeast
G&P
Severance and related costs $ 3 $ — $ — $ — $ 3 $ — Share of
impairment at equity-method investments — — 6 19 25 — ACMP Merger
and transition costs 2 — — — 2 — Organizational realignment-related
costs — — —
3 3
1 Total Northeast G&P adjustments 5 — 6 22 33 1
Atlantic-Gulf
Potential rate refunds associated with rate case litigation 15 — —
— 15 — Severance and related costs 8 — — — 8 — Constitution
Pipeline project development costs — 8 11 9 28 2 Organizational
realignment-related costs — — — — — 1 Gain on asset retirement
— — —
(11 ) (11 ) —
Total Atlantic-Gulf adjustments 23 8 11 (2 ) 40 3
West
Estimated minimum volume commitments 60 64 70 (194 ) — 15 Severance
and related costs 10 — — 3 13 — ACMP Merger and transition costs 3
— — — 3 — Impairment of certain assets — 48 — 22 70 —
Organizational realignment-related costs — — — 21 21 2
Gains from contract settlements and
terminations
— — —
— —
(13 ) Total West adjustments 73 112 70 (148 ) 107 4
NGL & Petchem
Services
Impairment of certain assets — 341 — — 341 — Loss related to Canada
disposition — — 32 2 34 (3 ) Severance and related costs 4 — — — 4
— Expenses associated with strategic asset monetizations — — — 2 2
1 Geismar Incident adjustment for insurance and timing — — — (7 )
(7 ) (9 ) Accrual for loss contingency —
— — —
— 9 Total NGL
& Petchem Services adjustments 4 341 32 (3 ) 374 (2 )
Other
Severance and related costs — — — 9 9 9 Gain on early retirement of
debt — — —
— —
(30 ) Total Other adjustments — — — 9 9 (21 )
Total Adjustments $ 105
$ 461 $ 119
$ (122 ) $
563 $ (15 ) Adjusted
EBITDA: Northeast G&P $ 225 $ 222 $ 220 $ 219 $ 886 $ 227
Atlantic-Gulf 405 368 434 454 1,661 453 West 400 424 433 394 1,651
389 NGL & Petchem Services 30 51 102 46 229 49 Other —
— —
— — (1 )
Total
Adjusted EBITDA $ 1,060 $
1,065 $ 1,189
$ 1,113 $
4,427 $ 1,117
* Recast due to the change in WPZ
segments in the first quarter of 2017.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170503006480/en/
Williams Partners L.P.Media Contact:Keith Isbell,
918-573-7308orInvestor Contacts:John Porter,
918-573-0797orBrett Krieg, 918-573-4614
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