HOUSTON, Feb. 26 /PRNewswire-FirstCall/ -- Cheniere Energy, Inc.
("Cheniere") (NYSE Amex: LNG) reported a net loss of $23.2 million,
or $0.44 per share (basic and diluted), for the fourth quarter 2009
compared with a net loss of $111.1 million, or $2.32 per share
(basic and diluted), during the corresponding 2008 period. For the
year ended December 31, 2009, Cheniere reported a net loss of
$161.5 million, or $3.13 per share (basic and diluted), compared
with a net loss of $373.0 million, or $7.87 per share (basic and
diluted), during the corresponding 2008 period. Included in the
year ended December 31, 2009 results is a gain on the early
extinguishment of debt of $45.4 million, or $0.88 per share (basic
and diluted). Included in the year ended December 31, 2008 results
is a loss on the early extinguishment of debt of $10.7 million, or
$0.23 per share (basic and diluted), and restructuring charges of
$78.7 million, or $1.66 per share (basic and diluted). Results are
reported on a consolidated basis and include our 90.6 percent
ownership interest in Cheniere Energy Partners, L.P. ("Cheniere
Partners"). Significant events during the year ended December 31,
2009 include the following: -- the receipt of capacity reservation
fee payments at Sabine Pass LNG from Cheniere Marketing, LLC
("Cheniere Marketing"), our wholly owned subsidiary, Total Gas
& Power North America, Inc. ("Total") and Chevron U.S.A., Inc.
("Chevron"), which became effective in October 2008, April 2009 and
July 2009 from Cheniere Marketing, Total and Chevron, respectively;
-- the completion of construction and achievement of full
operability of the Sabine Pass LNG receiving terminal; -- a
reduction of $120.4 million of our convertible debt; -- the receipt
of limited partner distributions from Freeport LNG Development,
L.P.; and -- the purchase of LNG inventory held at the Sabine Pass
LNG receiving terminal and sale of natural gas by Cheniere
Marketing. Results Cheniere reported income from operations of
$42.3 million and $23.5 million for the fourth quarter and year
ended December 31, 2009, respectively, compared to a loss from
operations of $63.2 million and $244.2 million for the
corresponding periods in 2008. Included in the year ended December
31, 2008 results were restructuring costs of $78.7 million. For the
fourth quarter and year ended December 31, 2009, total revenues
increased $85.0 million and $174.0 million, respectively, as
compared to the comparable 2008 periods. LNG receiving terminal
revenues increased $66.8 million and $170.1 million for the quarter
and year ended December 31, 2009, as compared to the comparable
2008 periods largely as a result of the commencement of capacity
payments under two third-party terminal use agreements ("TUAs")
that became effective on April 1, 2009 and July 1, 2009. Marketing
and trading revenues for the fourth quarter of 2009 increased by
$18.3 million compared to fourth quarter of 2008 due to recovery of
$14.2 million of inventory write-downs recognized in the second and
third quarters of 2009 and gains on derivative instruments and
physical natural gas sales. Marketing and trading revenues for the
year ended December 31, 2009 increased $5.2 million compared to the
same period in 2008 due to $8.6 million in derivative gains and
$2.3 million of net revenues from physical natural gas sales that
were partially offset by a $3.3 million inventory write-down. LNG
receiving terminal and pipeline operating expenses increased $0.9
million and $22.3 million, respectively, for the quarter and year
ended December 31, 2009 as compared to the comparable 2008 periods
and depreciation, depletion and amortization expense increased $3.6
million and $29.9 million, respectively, for the fourth quarter and
year ended December 31, 2009 from the comparable 2008 periods due
to the placement into service of the Sabine Pass LNG receiving
terminal and the Creole Trail pipeline during the second half of
2008. General and administrative expenses decreased $25.6 million
and $56.8 million for the fourth quarter and year ended December
31, 2009 from the comparable 2008 periods primarily due to the
restructuring initiatives implemented during 2008. General and
administrative expenses included non-cash compensation expenses of
approximately $5.5 million and $18.2 million for the fourth quarter
and year ended December 31, 2009, and $28.5 million and $52.2
million in the corresponding 2008 periods. Interest expense
increased $9.6 million in the fourth quarter 2009 compared to the
fourth quarter 2008 and increased $96.2 million for the year ended
December 31, 2009 compared to the corresponding 2008 period due to
less interest subject to capitalization related to decrease in
construction for both periods and an increase in the average debt
balances outstanding for the year ended December 31, 2009 compared
to 2008. Interest income decreased $2.3 million in the fourth
quarter 2009 compared to the fourth quarter 2008 and $18.9 million
for the year ended December 31, 2009 compared to the corresponding
2008 period due to lower interest rates during 2009 and a decrease
in the average cash outstanding year over year. Unrestricted cash
and cash equivalents held by Cheniere at December 31, 2009 were
$88.4 million. In addition, working capital used in trading
activities by Cheniere Marketing for inventory and hedges was
approximately $50 million. Restricted cash and cash equivalents at
December 31, 2009 were $221.2 million of which $213.7 million were
held at Cheniere Partners and $7.5 million were held at Cheniere.
Restricted cash held by Cheniere Partners included approximately
$82.4 million in a permanent debt service reserve and $13.7 million
for one month of interest as required by the Sabine Pass senior
notes indenture, and $117.6 million for working capital and general
purposes at Sabine Pass LNG. LNG Marketing and Trading During 2009,
Cheniere Marketing began successfully trading in the LNG spot
market. It purchased, transported and unloaded LNG at the Sabine
Pass receiving terminal and subsequently sold natural gas into the
U.S. markets. Cheniere Marketing purchases LNG and enters into
derivative contracts to hedge the cash flows from the future sales
of the LNG inventory. Due to the nature of the hedging strategy,
earnings are recognized in operating results as physical sales
occur, derivatives are settled or the fair value of the derivatives
change due to changes in natural gas prices. In the interim, the
LNG held in the storage tanks at the Sabine Pass LNG receiving
terminal is recorded at the lower of cost or market based on the
NYMEX natural gas index price for the last day of the period less
basis differentials. Net revenues for the year ended December 31,
2009 were $8.1 million. These results included $11.4 million of net
earnings related to physical sales of inventory and roll off of
hedges offset by a $3.3 million write-down of inventory due to the
lower of cost or market adjustment made at year end December 31,
2009. As of December 31, 2009, Cheniere Marketing and Sabine Pass
LNG had approximately 7,778,000 MMBtu of LNG inventory and had
entered into a total of approximately 7,465,000 MMBtu of natural
gas swaps through January 31, 2011 for which it will receive fixed
prices of $4.90 to $7.15 per MMBtu. Strategic Outlook Our strategic
focus is to safely manage and operate the Sabine Pass LNG receiving
terminal and Creole Trail pipeline, serve our customers and
monetize the 2.0 Bcf/d regasification capacity we have reserved
through Cheniere Marketing at the Sabine Pass LNG receiving
terminal. We also continue to develop our other projects and
consider investments in the energy business. Our strategy to
monetize our TUA capacity includes entering into long-term TUAs
with third parties, developing a portfolio of long-term, short-term
and spot LNG purchase agreements and entering into business
relationships for the domestic marketing of natural gas that is
imported by Cheniere Marketing into the Sabine Pass LNG receiving
terminal. Our strategy to improve our capital structure and address
maturities of our existing indebtedness may include entering into
long-term TUAs or LNG purchase and sales agreements that allow us
to refinance debt, issuing equity or other securities or selling
assets. Cheniere Energy, Inc. is a Houston-based energy company
primarily engaged in LNG related businesses, and owns and operates
the Sabine Pass LNG receiving terminal and Creole Trail pipeline in
Louisiana. Cheniere is pursuing related business opportunities both
upstream and downstream of the Sabine Pass LNG receiving terminal.
Cheniere is also the founder and holds a 30% limited partner
interest in another LNG receiving terminal. Additional information
about Cheniere Energy, Inc. may be found on its web site at
http://www.cheniere.com/. For additional information, please refer
to the Cheniere Energy, Inc. Annual Report on Form 10-K for the
year ended December 31, 2009, filed with the Securities and
Exchange Commission. This press release contains certain statements
that may include "forward-looking statements" within the meanings
of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. All statements, other than
statements of historical facts, included herein are
"forward-looking statements." Included among "forward-looking
statements" are, among other things, (i) statements regarding
Cheniere's business strategy, plans and objectives and (ii)
statements expressing beliefs and expectations regarding the
development of Cheniere's LNG receiving terminal and pipeline
businesses. Although Cheniere believes that the expectations
reflected in these forward-looking statements are reasonable, they
do involve assumptions, risks and uncertainties, and these
expectations may prove to be incorrect. Cheniere's actual results
could differ materially from those anticipated in these
forward-looking statements as a result of a variety of factors,
including those discussed in Cheniere's periodic reports that are
filed with and available from the Securities and Exchange
Commission. You should not place undue reliance on these
forward-looking statements, which speak only as of the date of this
press release. Other than as required under the securities laws,
Cheniere does not assume a duty to update these forward-looking
statements. (Financial Table Follows) Cheniere Energy, Inc.
Selected Financial Information (in thousands) (1) Three Months
Ended Year Ended December 31, December 31, ---------------
-------------- 2009 2008 2009 2008 ---- ---- ---- ---- (As
adjusted) (2) (As adjusted) (2) Revenues LNG receiving terminal
revenues $66,751 $- $170,071 $- Oil and gas sales 496 549 2,866
4,215 Marketing and trading 18,351 90 8,087 2,914 Other 3 13 102 15
--------- --------- --------- --------- Total revenues 85,601 652
181,126 7,144 --------- --------- --------- --------- Operating
costs and expenses LNG receiving terminal and pipeline development
expenses 100 (248) 223 10,556 LNG receiving terminal and pipeline
operating expenses 10,824 9,942 36,857 14,522 Exploration Costs -
30 - 128 Oil and gas production and exploration costs 182 75 471
398 Depreciation, depletion and amortization 15,103 11,510 54,229
24,346 General and administrative expenses 17,054 42,702 65,830
122,678 Restructuring charges 19 (147) 20 78,704 ---------
--------- --------- --------- Total operating costs and expenses
43,282 63,864 157,630 251,332 --------- --------- ---------
--------- Income (Loss) from operations 42,319 (63,212) 23,496
(244,188) Derivative gain 795 2,328 5,277 4,652 Loss from equity
method investments - - - (4,800) Gain (loss) on early
extinguishment of debt - 24 45,363 (10,691) Interest expense, net
(66,528) (56,887) (243,295) (147,136) Interest income 92 2,396
1,405 20,337 Other income (expense) (9) 193 99 90 Income tax
benefit - - - - Non-controlling interest 131 4,083 6,165 8,777
--------- --------- --------- --------- Net loss $(23,200)
$(111,075) $(161,490) $(372,959) ========= ========= =========
========= Net loss per common share- basic and diluted $(0.44)
$(2.32) $(3.13) $(7.87) ========= ========= ========= =========
Weighted average number of common shares outstanding -basic and
diluted 53,158 47,856 51,598 47,365 ========= ========= =========
========= December 31, December 31, ------------ ------------ 2009
2008 (As adjusted) (2) ----------- ------------ Cash and cash
equivalents $88,372 $102,192 Restricted cash and cash equivalents
138,309 301,550 LNG inventory 32,602 - Other current assets 26,992
12,850 Non-current restricted cash, cash equivalents and treasury
securities 82,892 159,312 Property, plant and equipment, net
2,216,855 2,170,158 Debt issuance costs, net 47,043 55,688 Goodwill
76,819 76,844 Other assets 22,738 41,488 ------ ------ Total assets
$2,732,622 $2,920,082 ========== ========== Current liabilities
$66,212 $66,133 Long-term debt, net of discount 3,041,875 3,082,362
Deferred revenue 33,500 37,500 Other liabilities 23,162 8,141
Non-controlling interest 217,605 250,162 Stockholders' (deficit)
equity (649,732) (524,216) -------- -------- Total Liabilities and
stockholders' (deficit) equity $2,732,622 $2,920,082 ==========
========== Cheniere Other Consolidated December 31, Sabine Energy
Cheniere Cheniere 2009 Pass LNG, L.P. Partners, L.P. Energy, Inc.
Energy, Inc. -------------- -------------- ------------
------------ Cash and cash equivalents $- $- $88,372 $88,372
Restricted cash, cash equivalents 213,538 130 7,533 221,201
---------- -------- --------- ---------- Total $213,538 $130
$95,905 $309,573 ========== ======== ========= ========== (1)
Please refer to the Cheniere Energy, Inc. Annual Report on Form
10-K for the period ended December 31, 2009, filed with the
Securities and Exchange Commission. (2) Effective January 1, 2009,
Cheniere adopted Financial Accounting Standards Board Staff
Position Accounting Principles Board No. 14-1, Accounting for
Convertible Debt Instruments That May Be Settled in Cash upon
Conversion. As such, the Balance Sheet as of December 31, 2008 and
Cheniere's Consolidated Statements of Operations for the three
months and year ended December 31, 2008 have been adjusted to
reflect this adoption. DATASOURCE: Cheniere Energy, Inc. CONTACT:
Investors, Christina Cavarretta, +1-713-375-5100, or Media,Diane
Haggard, +1-713-375-5259, both of Cheniere Energy, Inc. Web Site:
http://www.cheniere.com/
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