Cheniere Energy Partners, L.P. (NYSE American: CQP):
Summary of Fourth Quarter and Full Year
2017 Results (in millions, except LNG data)
Three Months Ended
Year Ended
December 31,
December 31,
2017
2016
2017
2016 Revenues $ 1,518 $ 551 $ 4,304 $ 1,100
Net income (loss) $ 374 $ 86 $ 490 $ (171 ) Adjusted EBITDA1 $ 612
$ 202 $ 1,512 $ 365 LNG exported: Number of cargoes 70 23 205 56
Volumes (TBtu) 252 81 734 195 LNG volumes loaded (TBtu) 252 82 735
196
2018 Full Year Distribution
Guidance
2018 Distribution per Unit
$2.00 - $2.20
Recent Achievements
Operational
- Substantial completion of Train 4 of
the SPL Project (defined below) was achieved in October 2017, more
than five months ahead of the guaranteed completion date.
- Over 200 cargoes were produced, loaded,
and exported from the SPL Project in 2017. To date, approximately
300 cumulative LNG cargoes have been exported from the SPL Project,
with deliveries to 25 countries and regions worldwide.
- Over 1,100 TBtu of natural gas
feedstock has been nominated to the SPL Project since startup, with
99.9% scheduling efficiency.
Financial
- We declared and paid distributions of
$1.79 per unit to common unitholders for full year 2017, within the
guidance range for the period.
- The date of first commercial delivery
(“DFCD”) was reached under the 20-year LNG Sale and Purchase
Agreement (“SPA”) with Korea Gas Corporation related to Train 3 of
the SPL Project in June 2017, and under the respective 20-year SPAs
with Gas Natural Fenosa LNG GOM, Limited and BG Gulf Coast LNG, LLC
relating to Train 2 of the SPL Project in August 2017. DFCD under
the 20-year SPA with GAIL (India) Limited related to Train 4 of the
SPL Project is expected to be reached in March 2018.
Liquefaction Project Update
SPL Project Liquefaction
Train Trains 1-3
Train 4 Train 5
Train 6 Project Status Operational Operational
Under Construction Permitted Expected
Substantial Completion Complete Complete 1H 2019 —
Expected DFCD Window Start
Complete 1H 2018 2H 2019 —
Cheniere Energy Partners, L.P. (“Cheniere Partners”) (NYSE
American: CQP) reported net income of $374 million and $490 million
for the three and twelve months ended December 31, 2017,
respectively, compared to net income of $86 million and net loss of
$171 million for the comparable periods in 2016. Adjusted EBITDA1
for the three and twelve months ended December 31, 2017 was $612
million and $1.5 billion, respectively, compared to $202 million
and $365 million for the comparable 2016 periods.
During the three and twelve months ended December 31, 2017, 70
and 205 LNG cargoes, respectively, were exported from the SPL
Project, of which 2 and 14, respectively, were commissioning
cargoes.
Total revenues increased $967 million and $3.2 billion during
the three and twelve months ended December 31, 2017, respectively,
as compared to the three and twelve months ended December 31, 2016.
Total operating costs and expenses increased $626 million and $2.3
billion during the three and twelve months ended December 31, 2017,
respectively, compared to the three and twelve months ended
December 31, 2016.
Variances in results of operations for the three and twelve
months ended December 31, 2017, as compared to the three and twelve
months ended December 31, 2016, were primarily driven by increased
income from operations, due primarily to the timing of completion
of Trains and the length of each Train’s operations within the
periods being compared, partially offset by increased interest
expense, net of amounts capitalized.
SPL Project Update
Through Cheniere Partners, we are developing up to six natural
gas liquefaction Trains at the Sabine Pass LNG terminal adjacent to
the existing regasification facilities (the “SPL Project”). Each
Train is expected to have a nominal production capacity, which is
prior to adjusting for planned maintenance, production reliability,
and potential overdesign, of approximately 4.5 million tonnes per
annum (“mtpa”) and an adjusted nominal production capacity of
approximately 4.3 to 4.6 mtpa of LNG. Trains 1 through 4 are
operational, Train 5 is under construction, and Train 6 is being
commercialized and has all necessary regulatory approvals in
place.
Distributions to
Unitholders
We paid a cash distribution per common and subordinated unit of
$0.50 to unitholders of record as of February 2, 2018 and the
related general partner distribution on February 14, 2018.
Investor Conference Call and
Webcast
Cheniere Energy, Inc. will host a conference call to discuss its
financial and operating results for the fourth quarter and full
year on Wednesday, February 21, 2018, at 10 a.m. Eastern time
/ 9 a.m. Central time. A listen-only webcast of the call and an
accompanying slide presentation may be accessed through our website
at www.cheniere.com. Following the call, an archived recording will
be made available on our website. The call and accompanying slide
presentation may include financial and operating results or other
information regarding Cheniere Partners.
______________
1 Non-GAAP financial measure. See
“Reconciliation of Non-GAAP Measures” for further details.
About Cheniere Partners
Cheniere Partners, through its subsidiary, Sabine Pass
Liquefaction, LLC (“SPL”), is developing, constructing, and
operating natural gas liquefaction facilities at the Sabine Pass
LNG terminal located in Cameron Parish, Louisiana, on the
Sabine-Neches Waterway less than four miles from the Gulf Coast.
Cheniere Partners, through SPL, plans to construct up to six
liquefaction trains (“Trains”), which are in various stages of
development, construction, and operations. Trains 1 through 4 are
operational, Train 5 is under construction and Train 6 is being
commercialized and has all necessary regulatory approvals in place.
Each Train is expected to have a nominal production capacity, which
is prior to adjusting for planned maintenance, production
reliability, and potential overdesign, of approximately 4.5 mtpa of
LNG and an adjusted nominal production capacity of approximately
4.3 to 4.6 mtpa of LNG.
Through its wholly owned subsidiary, Sabine Pass LNG, L.P.,
Cheniere Partners owns and operates regasification facilities at
the Sabine Pass LNG terminal, which includes pre-existing
infrastructure of five LNG storage tanks with aggregate capacity of
approximately 16.9 billion cubic feet equivalent (“Bcfe”), two
marine berths that can each accommodate vessels with nominal
capacity of up to 266,000 cubic meters and vaporizers with
regasification capacity of approximately 4.0 Bcf/d. Cheniere
Partners also owns a 94-mile pipeline that interconnects the Sabine
Pass LNG terminal with a number of large interstate pipelines
through its wholly owned subsidiary, Cheniere Creole Trail
Pipeline, L.P.
For additional information, please refer to the Cheniere
Partners website at www.cheniere.com and Annual Report on Form 10-K
for the fiscal year ended December 31, 2017, filed with the
Securities and Exchange Commission.
Forward-Looking Statements
This press release contains certain statements that may include
“forward-looking statements.” All statements, other than statements
of historical or present facts or conditions, included herein are
“forward-looking statements.” Included among “forward-looking
statements” are, among other things, (i) statements regarding
Cheniere Partners’ business strategy, plans and objectives,
including the development, construction and operation of
liquefaction facilities, (ii) statements regarding expectations
regarding regulatory authorizations and approvals, (iii) statements
expressing beliefs and expectations regarding the development of
Cheniere Partners’ LNG terminal and liquefaction business, (iv)
statements regarding the business operations and prospects of third
parties, (v) statements regarding potential financing arrangements,
and (vi) statements regarding future discussions and entry into
contracts. Although Cheniere Partners 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
Partners’ 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 Partners’
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 Partners does not assume a duty to update
these forward-looking statements.
(Financial Tables Follow)
Cheniere Energy Partners, L.P.
Consolidated Statements of
Operations
(in millions, except per unit
data)
(Unaudited)
Three Months Ended Year Ended December 31,
December 31, (1) 2017
2016 2017 2016 Revenues LNG
revenues $ 917 $ 205 $ 2,635 $ 539 LNG revenues—affiliate 525 278
1,389 294 Regasification revenues 65 65 260 259 Other revenues 13 2
20 4 Other revenues—affiliate (2 ) 1 — 4 Total
revenues 1,518 551 4,304 1,100 Operating costs and expenses
Cost of sales (excluding depreciation and
amortization
expense shown separately below)
740 198 2,320 410 Cost of sales—affiliate — 1 — 2 Operating and
maintenance expense 87 47 292 127 Operating and maintenance
expense—affiliate 30 16 100 52 Development expense 1 — 3 — General
and administrative expense 2 4 12 13 General and administrative
expense—affiliate 17 22 80 90 Depreciation and amortization expense
100 64 339 156 Other 1 — 2 — Total
operating costs and expenses 978 352 3,148 850
Income from operations 540 199 1,156 250 Other
income (expense) Interest expense, net of capitalized interest (177
) (128 ) (614 ) (357 ) Loss on early extinguishment of debt — (18 )
(67 ) (72 ) Derivative gain, net 6 32 4 6 Other income 5 1
11 2 Total other expense (166 ) (113 ) (666 )
(421 ) Net income (loss) $ 374 $ 86 $ 490
$ (171 ) Basic and diluted net income (loss) per
common unit $ 0.76 $ 0.07 $ (1.32 ) $ (0.20 )
Weighted average number of common units
outstanding used for
basic and diluted net income (loss) per
common unit calculation
348.6 57.1 178.5 57.1
______________
(1) Please refer to the Cheniere Energy Partners, L.P.
Annual Report on Form 10-K for the fiscal year ended December 31,
2017, filed with the Securities and Exchange Commission.
Cheniere Energy Partners, L.P.
Consolidated Balance Sheets
(in millions, except unit data)
(1)
December 31, 2017
2016 ASSETS Current assets Cash and
cash equivalents $ — $ — Restricted cash 1,589 605 Accounts and
other receivables 191 90 Accounts receivable—affiliate 163 99
Advances to affiliate 36 38 Inventory 95 97 Other current assets 65
29 Total current assets 2,139 958 Property, plant and
equipment, net 15,139 14,158 Debt issuance costs, net 38 121
Non-current derivative assets 31 83 Other non-current assets, net
206 222 Total assets $ 17,553 $ 15,542
LIABILITIES AND PARTNERS’ EQUITY Current liabilities Accounts
payable $ 12 $ 27 Accrued liabilities 637 418 Current debt — 224
Due to affiliates 68 99 Deferred revenue 111 73 Deferred
revenue—affiliate 1 1 Derivative liabilities — 14 Total
current liabilities 829 856 Long-term debt, net 16,046
14,209 Non-current deferred revenue 1 5 Non-current derivative
liabilities 3 2 Other non-current liabilities 10 — Other
non-current liabilities—affiliate 25 27 Commitments and
contingencies Partners’ equity
Common unitholders’ interest (348.6
million units and 57.1 million units issued and
outstanding at December 31, 2017 and 2016,
respectively)
1,670 130
Class B unitholders’ interest (zero and
145.3 million units issued and outstanding at
December 31, 2017 and 2016,
respectively)
— 62
Subordinated unitholders’ interest (135.4
million units issued and outstanding at
December 31, 2017 and 2016)
(1,043 ) 240
General partner’s interest (2% interest
with 9.9 million units and 6.9 million units issued
and outstanding at December 31, 2017 and
2016, respectively)
12 11 Total partners’ equity 639 443 Total
liabilities and partners’ equity $ 17,553 $ 15,542
______________
(1) Please refer to the Cheniere Energy Partners, L.P.
Annual Report on Form 10-K for the fiscal year ended December 31,
2017, filed with the Securities and Exchange Commission.
Reconciliation of Non-GAAP Measures
Regulation G Reconciliation
In addition to disclosing financial results in accordance with
U.S. GAAP, the accompanying news release contains a non-GAAP
financial measure. Adjusted EBITDA is a non-GAAP financial measure
that is used to facilitate comparisons of operating performance
across periods. This non-GAAP measure should be viewed as a
supplement to and not a substitute for our U.S. GAAP measures of
performance and the financial results calculated in accordance with
U.S. GAAP, and the reconciliation from these results should be
carefully evaluated.
Adjusted EBITDA is calculated by taking net income (loss) before
interest expense, net of capitalized interest, changes in the fair
value and settlement of our interest rate derivatives, taxes,
depreciation and amortization, and adjusting for the effects of
certain non-cash items, other non-operating income or expense items
and other items not otherwise predictive or indicative of ongoing
operating performance, including the effects of modification or
extinguishment of debt and changes in the fair value of our
commodity derivatives. Adjusted EBITDA is not intended to represent
cash flows from operations or net income (loss) as defined by U.S.
GAAP and is not necessarily comparable to similarly titled measures
reported by other companies.
We believe Adjusted EBITDA provides relevant and useful
information to management, investors and other users of our
financial information in evaluating the effectiveness of our
operating performance in a manner that is consistent with
management’s evaluation of business performance. Management
believes Adjusted EBITDA is widely used by investors to measure a
company’s operating performance without regard to items such as
interest expense, taxes, depreciation and amortization which vary
substantially from company to company depending on capital
structure, the method by which assets were acquired and
depreciation policies. Further, the exclusion of certain non-cash
items, other non-operating income or expense items and other items
not otherwise predictive or indicative of ongoing operating
performance enables comparability to prior period performance and
trend analysis.
Adjusted EBITDA
The following table reconciles our Adjusted EBITDA to U.S. GAAP
results for the three and twelve months ended December 31, 2017 and
2016 (in millions):
Three Months Ended
Year Ended December 31, December 31,
2017 2016 2017
2016 Net income (loss) $ 374 $ 86 $ 490 $ (171 ) Interest
expense, net of capitalized interest 177 128 614 357 Loss on early
extinguishment of debt — 18 67 72 Derivative gain, net (6 ) (32 )
(4 ) (6 ) Other income (5 ) (1 ) (11 ) (2 ) Income from operations
$ 540 $ 199 $ 1,156 $ 250 Adjustments
to reconcile income from operations to Adjusted EBITDA:
Depreciation and amortization expense 100 64 339 156 Loss (gain)
from changes in fair value of commodity derivatives, net (28 ) (61
) 17 (41 ) Adjusted EBITDA $ 612 $ 202 $ 1,512
$ 365
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version on businesswire.com: http://www.businesswire.com/news/home/20180221005284/en/
Cheniere Energy Partners, L.P.InvestorsRandy Bhatia, 713-375-5479Megan Light,
713-375-5492orMediaEben
Burnham-Snyder, 713-375-5764
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