DALLAS, May 1, 2018 /PRNewswire/ -- The EnLink
Midstream companies (EnLink), EnLink Midstream Partners, LP (NYSE:
ENLK) (the Partnership or ENLK) and EnLink Midstream, LLC
(NYSE: ENLC) (the General Partner or ENLC), reported financial
results for the first quarter of 2018, reaffirmed full-year 2018
guidance, and announced an expansion of its crude oil gathering
system in Central Oklahoma.
Highlights
- ENLK reported net income attributable to ENLK after
non-controlling interest of approximately $60 million for the first quarter of 2018,
compared to approximately $18 million
for the first quarter of 2017. This represents approximately 230
percent growth quarter over quarter.
- ENLK achieved approximately $244
million of adjusted EBITDA net to ENLK for the first quarter
of 2018, compared to approximately $208
million for the first quarter of 2017. This represents
approximately 17 percent growth quarter over quarter. Adjusted
EBITDA is a non-GAAP measure and is explained in greater detail
under "Non-GAAP Financial Information."
- ENLC reported net income attributable to ENLC after
non-controlling interest of approximately $12 million for the first quarter of 2018,
compared to a net loss of approximately $2
million for the first quarter of 2017. This represents
approximately $14 million growth
quarter over quarter.
- ENLC achieved approximately $57
million of cash available for distribution for the first
quarter of 2018, compared to approximately $51 million for the first quarter of 2017. This
represents approximately 12 percent growth quarter over quarter.
Cash available for distribution is a non-GAAP measure and is
explained in greater detail under "Non-GAAP Financial
Information."
- EnLink reaffirmed full-year 2018 guidance for both ENLK and
ENLC.
- EnLink completed construction of the first phase of its
previously announced Black Coyote crude oil gathering system during
the first quarter of 2018, with the system becoming operational
during April 2018. EnLink also signed
a new commercial contract to provide crude oil gathering services
for an existing large, active customer in the STACK. EnLink is now
the primary crude oil gathering service provider for two of the
largest producers in the STACK. EnLink expects to spend
approximately $40 million of growth
capital during 2018 related to this strategic expansion, called the
Redbud crude oil gathering system, with an expected operational
date during the second half of 2018.
- EnLink's Oklahoma segment
realized strong volume growth during the first quarter of 2018.
Average gas gathering and transmission volumes increased by
approximately 10 percent from fourth quarter 2017 and 49 percent
from first quarter 2017. Average processing volumes increased
approximately 9 percent from fourth quarter 2017 and 64 percent
from first quarter 2017.
"EnLink continues to execute well on our long-term strategic
plan and continues to deliver solid growth in financial results,"
said Michael J. Garberding, EnLink
President and Chief Executive Officer. "Operating in the right
places with the right partners has enabled us to develop an
opportunity-rich inventory of projects, highlighted by today's
announcement of an exciting crude oil gathering expansion in the
STACK. We continue to enhance our strategic asset positions
while putting highly efficient capital to work across our key
growth areas. Our long-term growth outlook is robust, and we
remain committed to returning value to unitholders and maintaining
a strong balance sheet."
EnLink Midstream Partners, LP: First Quarter 2018
Financial Results
- The Partnership reported net income attributable to ENLK of
$60.1 million for the first quarter
of 2018, compared to net income of $18.1
million for the first quarter of 2017.
- The Partnership achieved $243.7
million of adjusted EBITDA net to ENLK for the first quarter
of 2018, compared to $207.6 million
for the first quarter of 2017.
- The Partnership reported net cash provided by operating
activities of $192.7 million for the
first quarter of 2018, compared to net cash provided by operating
activities of $174.2 million for the
first quarter of 2017.
- Distributable cash flow attributable to ENLK's common units was
$171.2 million for the first quarter
of 2018, as compared to $153.0
million for the first quarter of 2017. Distributable cash
flow is a non-GAAP measure and is explained in greater detail under
"Non-GAAP Financial Information."
- ENLK reaffirmed its full-year 2018 guidance, which includes net
income of $255 million to
$315 million and adjusted EBITDA of
$950 million to $1.02 billion.
- Distribution coverage was 1.12x for the first quarter of 2018,
compared to 1.01x for the first quarter of 2017.
- Debt to adjusted EBITDA as of March 31,
2018 was 3.85x, compared to 3.99x as of March 31, 2017.
- Growth capital expenditures net to ENLK for the first quarter
of 2018 totaled approximately $138
million. Total EnLink funded capital expenditures outlook
remains unchanged for 2018, however, segment level growth capital
expenditure outlook has been adjusted to reflect the new Redbud
crude oil gathering system expansion in Oklahoma and the expected timing of gas
opportunities in and around the Gulf Coast region:
-
- Crude and condensate range has increased by $40 million
- Louisiana range has decreased
by $40 million
- Full-year 2018 growth capital expenditure outlook net to ENLK
is now at a range of $580 million to
$710 million, which reflects a
$5 million reduction from the
previous range of $585 million to
$715 million. The reduction in growth
capital expenditures outlook net to ENLK is offset by an equal
increase in ENLC's growth capital expenditure outlook due to a
reduction in projects funded solely by ENLK and the addition of
Redbud which is jointly funded.
- As of April 26, 2018, ENLK had
350,243,418 common units outstanding.
EnLink Midstream, LLC: First Quarter 2018
Financial Results
- The General Partner reported net income attributable to ENLC of
$12.4 million for the first quarter
of 2018, compared to a net loss of $1.9
million for the first quarter of 2017.
- ENLC's cash available for distribution totaled $56.6 million for the first quarter of 2018,
compared to $51.0 million for the
first quarter of 2017. The cash available for distribution for the
first quarter of 2018 included $8.9
million related to ENLC's approximately 16 percent interest
in EnLink Oklahoma Gas Processing LP (together with its
subsidiaries, "EnLink Oklahoma T.O.").
- ENLC reaffirmed its full-year 2018 guidance, which includes net
income of $233 million to
$291 million, and cash available for
distribution of $230 million to
$240 million.
- Growth capital expenditures net to ENLC for the first quarter
of 2018 totaled approximately $12
million. Full-year 2018 growth capital expenditure outlook
net to ENLC has increased due to the crude oil gathering expansion
in the STACK, with the expected range now being $50 million to $60
million, up $5 million from
the previous range of $45 million to
$55 million.
- Distribution coverage was 1.18x for the first quarter of 2018,
compared to 1.09x for the first quarter of 2017.
- As of April 26, 2018, ENLC had
181,042,318 common units outstanding.
Regional Updates:
Central Oklahoma:
- EnLink's Oklahoma segment
reported strong segment profit growth during the first quarter of
2018, achieving an approximate 11 percent increase over the fourth
quarter of 2017 and achieving an approximate 80 percent increase
from the first quarter 2017. The pace of growth in the Oklahoma segment anchors management's
confidence in the strength of the STACK play and the ability to
achieve 2018 year guidance.
- EnLink's Oklahoma segment
experienced solid volume growth during the first quarter of 2018,
including average gas gathering and transmission volume increases
of 10 percent and average processing volume increases of 9 percent,
in each case, as compared to the fourth quarter of 2017. Average
gas gathering and transmission volumes increased 49 percent and
average processing volumes increased approximately 64 percent, in
each case, from the first quarter of 2017. Volume growth in
Central Oklahoma is expected to
remain robust as Devon Energy Corp. and other large active producer
customers on EnLink's dedicated acreage continue to deliver strong
well results and transition to full-field development.
- EnLink's previously announced Thunderbird processing plant is
progressing well and remains on track to be operational during the
first quarter of 2019. Once operational, Thunderbird will increase
EnLink's gas processing capacity in Central Oklahoma by 200 million cubic feet per
day (MMcf/d), bringing total gas processing capacity to
approximately 1.2 Bcf/d and reinforcing EnLink's position as one of
the largest and most cost-efficient providers of natural gas
processing in the STACK.
- During the first quarter of 2018, Devon brought Coyote on-line, its first large
scale development. Coyote is comprised of seven wells, four of
which are currently producing, and the development is delivering
record flow rates. Devon announced
that its Showboat development, which is comprised of 24 wells, is
in progress and is currently 40 days ahead of plan. According to
Devon, Showboat's first production
was achieved in April, and well tie-ins are staggered over the next
two months. Devon has indicated
that it expects Showboat to be fully producing by the end of the
second quarter of 2018.
- EnLink placed the first phase of its crude oil gathering
system, Black Coyote, into service in April of 2018. Black Coyote
will initially gather volumes primarily from Devon's Showboat development and is expected
to connect to all of Devon's
near-term large-scale development projects. Devon is concentrating resources in the
over-pressured oil window, which has the best returns in the play,
and Devon expects to have eight
large-scale developments underway by year end.
- EnLink continues to enhance its core position in Central Oklahoma with the signing of a new
commercial contract to provide additional crude oil gathering
services for an existing large and active customer in the STACK.
This project, called the Redbud crude oil gathering system, will
build upon the Black Coyote footprint, with total 2018 growth
capital expenditures related to this expansion expected to be
approximately $40 million. ENLC will
fund approximately 16 percent of the capital expenditures related
to this project, with ENLK funding the remainder. EnLink is now the
primary crude oil gathering service provider for two of the largest
producers in the STACK.
Midland Basin:
- EnLink's Midland Basin natural gas volume activity remained
sequentially flat, as the pace of well completions in the first
quarter of 2018 was slower than forecasted. Volumes exited
March 2018 above the quarterly
average and have continued to increase since the end of the
quarter. Volumes have increased by approximately 12 percent from
the first quarter of 2017, and one of EnLink's largest producer
customers recently announced the acquisition of another of EnLink's
largest producer customers. The combined company is expected to run
one of the largest drilling program in the Permian Basin, which
will likely benefit EnLink.
- EnLink's Midland Basin natural gas processing facilities
averaged approximately 60 percent utilization of total capacity in
the first quarter of 2018. EnLink's position in the Midland Basin
reflects an attractive opportunity for additional low-cost,
high-return expansions, including filling available capacity.
EnLink also has the infrastructure in place to cost effectively
expand the Riptide processing facility by an additional 100 MMcf/d
as system volumes continue to increase.
- EnLink's Chickadee crude oil gathering operations in the
Midland Basin have achieved recent success with the addition of two
new customers to the system. The new projects are expected to be
accretive to volumes and segment profit during 2018, and leverage
the gathering platform in place. EnLink continues to successfully
execute its crude oil gathering strategy in the Permian Basin, and
EnLink's proven capabilities are attracting new opportunities.
Delaware Basin:
- Volumes across EnLink's Delaware Basin Joint Venture (JV) system were
roughly flat sequentially, as the pace of well completions in the
first quarter of 2018 was slower than forecasted. Volumes exited
the first quarter of 2018 above the quarterly average, and have
continued to increase since the end of the quarter. Volumes have
increased by approximately 110 percent from the first quarter of
2017. Rig activity remains strong on the JV's footprint, and solid
volume growth is expected for the second half of 2018 and into
2019.
- The JV previously announced the construction of Lobo III, a new
200 MMcf/d expansion of gas processing capacity at the existing
Lobo complex. The construction of the facility is progressing well
and is expected to be operational during the second half of
2018.
Louisiana:
- EnLink's natural gas liquids (NGL) network continues to benefit
from growth in liquids output from EnLink's Chisholm processing
complex in the STACK. NGLs produced from EnLink's Chisholm complex
are preferentially shipped to EnLink's Gulf Coast operations for
further transportation, fractionation and downstream value
creation. NGL volumes on EnLink's system were up slightly during
the first quarter of 2018 from a very strong fourth quarter of
2017, and volumes are expected to remain roughly in-line with first
quarter of 2018 levels for the remainder of 2018.
- EnLink continued to experience increased volumes on its
Louisiana gas system during the
first quarter of 2018, driven by strong demand across its Gulf
Coast network. Gathering and transmission throughput on EnLink's
Louisiana gas system hit record
highs during the first quarter of 2018, exceeding, on average, 2.2
Bcf/d. This growth reflects a six percent increase as compared to
the fourth quarter of 2017 and 15 percent growth as compared to the
first quarter of 2017. Volumes are expected to remain above initial
guidance expectations for the balance of 2018.
North Texas:
- Devon recently announced a
joint venture with Dow Chemical Co. in the liquids-rich area of the
Barnett Shale, where the two companies plan to partner in the
drilling of up to 116 new wells over a five-year period, with
approximately 20 wells expected to be drilled in 2018. Devon's stated intention is to execute a
capital program that stabilizes production for its retained assets
in the area, which in turn will assist in stabilizing EnLink's
long-term volume outlook as volumes naturally decline in this
mature basin.
- Devon also recently announced
the sale of its Johnson County
acreage, and EnLink is encouraged by the potential for the incoming
producer to bring an increased focus on optimizing existing wells,
new refrac activity and potential new well drilling plans. The
acreage produces volumes that represent approximately 7 percent of
EnLink's North Texas revenues, and
incremental capital and focus in this area is expected to
positively impact volumes.
First Quarter 2018 Earnings Call Details
The General
Partner and the Partnership will hold a conference call to discuss
first quarter 2018 results on Wednesday, May 2, 2018, at 9
a.m. Central Time (10 a.m. Eastern Time). The
dial-in number for the call is 1-855-656-0924. Callers
outside the United States should dial 1-412-542-4172.
Participants can also preregister for the conference call by
navigating to http://dpregister.com/10118595 where they will
receive dial-in information upon completion of preregistration.
Interested parties can access an archived replay of the call on the
Investors' page of EnLink's website at www.EnLink.com.
About the EnLink Midstream Companies
EnLink provides integrated midstream services across natural gas,
crude oil, condensate, and NGL commodities. EnLink operates
in several top U.S. basins and is strategically focused on the core
growth areas of the Permian's Midland
and Delaware basins, Oklahoma's Midcontinent,
and Louisiana's Gulf Coast. Headquartered in Dallas,
EnLink is publicly traded through EnLink Midstream,
LLC (NYSE: ENLC), the General Partner, and EnLink
Midstream Partners, LP (NYSE: ENLK), the Master Limited
Partnership. Visit www.EnLink.com for more information on how
EnLink connects energy to life.
Non-GAAP Financial Information & Other
Definitions
This press release contains non-generally
accepted accounting principles financial measures that we refer to
as adjusted EBITDA, distributable cash flow available to common
unitholders ("distributable cash flow"), and the General Partner's
cash available for distribution. We define adjusted EBITDA as net
income (loss) plus interest expense, provision (benefit) for income
taxes, depreciation and amortization expense, impairments ,
unit-based compensation, (gain) loss on non-cash derivatives,
(gain) loss on disposition of assets, (gain) loss on extinguishment
of debt, successful acquisition transaction costs (if any),
accretion expense associated with asset retirement obligations,
non-cash rent and distributions from unconsolidated affiliate
investments less payments under onerous performance obligations,
non-controlling interest and (income) loss from unconsolidated
affiliate investments. We define distributable cash flow as
adjusted EBITDA (defined above), net to the Partnership, less
interest expense (excluding amortization of the EnLink Oklahoma
T.O. acquisition installment payable discount), litigation
settlement adjustment, adjustments for the redeemable
non-controlling interest, interest rate swaps, current income taxes
and other non-distributable cash flows, accrued cash distributions
on Series B Preferred Units and Series C Preferred Units paid or
expected to be paid, and maintenance capital expenditures,
excluding maintenance capital expenditures that were contributed by
other entities and relate to the non-controlling interest share of
our consolidated entities. The General Partner's cash available for
distribution is defined as net income (loss) of the General Partner
less the net income (loss) attributable to the Partnership, which
is consolidated into the General Partner's net income (loss), plus
the General Partner's (i) share of distributions from the
Partnership, (ii) share of EnLink Oklahoma T.O.'s non-cash
expenses, (iii) deferred income tax expense (benefit), (iv)
corporate goodwill impairment, if any, and (v) successful
acquisition transaction costs, if any, less the General Partner's
interest in maintenance capital expenditures of EnLink Oklahoma
T.O., and less third-party non-controlling interest share of the
Partnership's net income (loss) from consolidated affiliates.
The Partnership's distribution coverage is calculated by
dividing distributable cash flow by distributions declared to the
General Partner and the common unitholders. The General Partner's
distribution coverage is calculated by dividing cash available for
distribution by distributions declared by the General Partner.
Growth capital expenditures generally include capital
expenditures made for acquisitions or capital improvements that we
expect will increase our asset base, operating income or operating
capacity over the long-term. Maintenance capital expenditures
generally include capital expenditures made to replace partially or
fully depreciated assets in order to maintain the existing
operating capacity of the assets and to extend their useful
lives.
The Partnership and General Partner believe these measures are
useful to investors because they may provide users of this
financial information with meaningful comparisons between current
results and previously-reported results and a meaningful measure of
each of the Partnership's and the General Partner's cash flow after
it has satisfied the capital and related requirements of its
operations. In addition, adjusted EBITDA achievement is a
primary metric used in the Partnership's credit facility and
short-term incentive program for compensating its employees.
Segment profit (loss) is defined as operating income (loss) plus
general and administrative expenses, depreciation and amortization,
(gain) loss on disposition of assets, impairments and (gain) loss
on litigation settlement. Segment profit (loss) includes non-cash
compensation expenses reflected in operating expenses. See "Item 8.
Financial Statements and Supplementary Data – Note 15 – Segment
Information" in ENLK's Annual Report on Form 10-K for the year
ended December 31, 2017, and, when
available, "Item 1. Financial Statements and Supplementary Data –
Note 11—Segment Information" in ENLK's Quarterly Report on Form
10-Q for the three months ended March 31, 2018, for further
information about segment profit (loss)
Adjusted EBITDA, distributable cash flow, and cash available for
distribution, as defined above, are not measures of financial
performance or liquidity under GAAP. They should not be considered
in isolation or as an indicator of the Partnership's and the
General Partner's performance. Furthermore, they should not be seen
as a substitute for metrics prepared in accordance with GAAP.
Reconciliations of these measures to their most directly comparable
GAAP measures are included in the following tables. See
ENLK's and ENLC's filings with the Securities and Exchange
Commission for more information.
Forward-Looking Statements
This press
release contains forward-looking statements within the meaning of
the federal securities laws. Although these statements reflect the
current views, assumptions and expectations of our management, the
matters addressed herein involve certain assumptions, risks and
uncertainties that could cause actual activities, performance,
outcomes and results to differ materially from those indicated
herein. Therefore, you should not rely on any of these
forward-looking statements. All statements, other than statements
of historical fact, included in this press release constitute
forward-looking statements, including but not limited to statements
identified by the words "forecast," "may," "believe," "will,"
"should," "plan," "predict," "anticipate," "intend," "estimate,"
and "expect" and similar expressions. Such forward-looking
statements include, but are not limited to, statements about
guidance, projected or forecasted financial and operating results,
timing for completion of construction or expansion projects, future
operational results of our customers, results in certain basins,
future rig count information, objectives, expectations, and
intentions, and other statements that are not historical facts.
Factors that could result in such differences or otherwise
materially affect our financial condition, results of operations,
or cash flows include, without limitation,(a) the dependence
on Devon for a substantial portion
of the natural gas that we gather, process, and transport,
(b) developments that materially and adversely affect
Devon or other customers,
(c) Devon's ability to compete with us, (d) adverse
developments in the midstream business may reduce our ability to
make distributions, (e) our vulnerability to having a
significant portion of our operations concentrated in the Barnett
Shale, (f) continually competing for crude oil, condensate,
natural gas, and NGL supplies and any decrease in the availability
of such commodities, (g) decreases in the volumes that we gather,
process, fractionate, or transport, (h) construction risks in our
major development projects, (i) our ability to receive or renew
required permits and other approvals, (j) changes in the
availability and cost of capital, including as a result of a change
in our credit rating, (k) operating hazards, natural
disasters, weather-related issues or delays, casualty losses, and
other matters beyond our control, (l) impairments to goodwill,
long-lived assets and equity method investments, and (m) the
effects of existing and future laws and governmental regulations,
including environmental and climate change requirements and other
uncertainties. These and other applicable uncertainties, factors,
and risks are described more fully in EnLink Midstream Partners,
LP's and EnLink Midstream, LLC's filings with the Securities and
Exchange Commission, including EnLink Midstream Partners, LP's and
EnLink Midstream, LLC's Annual Reports on Form 10-K, Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K.
Neither EnLink Midstream Partners, LP nor EnLink Midstream, LLC
assumes any obligation to update any forward-looking
statements.
The assumptions and estimates underlying the forecasted
financial information included in the guidance information in this
press release are inherently uncertain and, though considered
reasonable by the EnLink Midstream management team as of the date
of its preparation, are subject to a wide variety of significant
business, economic, and competitive risks and uncertainties that
could cause actual results to differ materially from those
contained in the forecasted financial information. Accordingly,
there can be no assurance that the forecasted results are
indicative of EnLink Midstream's future performance or that actual
results will not differ materially from those presented in the
forecasted financial information. Inclusion of the forecasted
financial information in this press release should not be regarded
as a representation by any person that the results contained in the
forecasted financial information will be achieved.
EnLink Midstream
Partners, LP
|
Selected Financial
Data
|
(All amounts in
millions except per unit amounts)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2018
|
|
2017
|
Total
revenues
|
$
|
1,761.7
|
|
|
$
|
1,321.9
|
|
Cost of
sales
|
1,381.5
|
|
|
1,002.3
|
|
Gross operating
margin
|
380.2
|
|
|
319.6
|
|
Operating costs and
expenses, excluding cost of sales:
|
|
|
|
Operating
expenses
|
109.2
|
|
|
104.1
|
|
General and
administrative
|
26.2
|
|
|
35.0
|
|
Loss on disposition
of assets
|
0.1
|
|
|
5.1
|
|
Depreciation and
amortization
|
138.1
|
|
|
128.3
|
|
Impairments
|
—
|
|
|
7.0
|
|
Gain on litigation
settlement
|
—
|
|
|
(17.5)
|
|
Total operating costs
and expenses, excluding cost of sales
|
273.6
|
|
|
262.0
|
|
Operating
income
|
106.6
|
|
|
57.6
|
|
Other income
(expense):
|
|
|
|
Interest expense, net
of interest income
|
(43.7)
|
|
|
(44.5)
|
|
Income from
unconsolidated affiliates
|
3.0
|
|
|
0.7
|
|
Other
income
|
0.2
|
|
|
—
|
|
Total other
expense
|
(40.5)
|
|
|
(43.8)
|
|
Income before
non-controlling interest and income taxes
|
66.1
|
|
|
13.8
|
|
Income tax
provision
|
(1.0)
|
|
|
(0.5)
|
|
Net income
|
65.1
|
|
|
13.3
|
|
Net income (loss)
attributable to non-controlling interest
|
5.0
|
|
|
(4.8)
|
|
Net income
attributable to ENLK
|
$
|
60.1
|
|
|
$
|
18.1
|
|
General partner
interest in net income
|
$
|
10.6
|
|
|
$
|
5.9
|
|
Limited partners'
interest in net income (loss) attributable to ENLK
|
$
|
21.6
|
|
|
$
|
(9.3)
|
|
Series B preferred
interest in net income attributable to ENLK
|
$
|
21.9
|
|
|
$
|
21.5
|
|
Series C preferred
interest in net income attributable to ENLK
|
$
|
6.0
|
|
|
$
|
—
|
|
Net income (loss)
attributable to ENLK per limited partners' unit:
|
|
|
|
Basic common
unit
|
$
|
0.06
|
|
|
$
|
(0.03)
|
|
Diluted common
unit
|
$
|
0.06
|
|
|
$
|
(0.03)
|
|
EnLink Midstream
Partners, LP
|
Reconciliation of
Net Income to Adjusted EBITDA and Distributable Cash Flow and Calculation of
Coverage Ratio
|
(All amounts in
millions except ratios and per unit amounts)
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2018
|
|
2017
|
Net income
|
$
|
65.1
|
|
$
|
13.3
|
Interest expense, net
of interest income
|
43.7
|
|
44.5
|
Depreciation and
amortization
|
138.1
|
|
128.3
|
Impairments
|
—
|
|
7.0
|
Income from
unconsolidated affiliates
|
(3.0)
|
|
(0.7)
|
Distributions from
unconsolidated affiliates
|
6.0
|
|
2.9
|
Loss on disposition
of assets
|
0.1
|
|
5.1
|
Unit-based
compensation
|
5.1
|
|
19.3
|
Income tax
provision
|
1.0
|
|
0.5
|
(Gain) loss on
non-cash derivatives
|
3.5
|
|
(5.3)
|
Payments under
onerous performance obligation offset to other current and
long-term liabilities
|
(4.5)
|
|
(4.5)
|
Other (1)
|
1.1
|
|
0.8
|
Adjusted EBITDA
before non-controlling interest
|
$
|
256.2
|
|
$
|
211.2
|
Non-controlling
interest share of adjusted EBITDA (2)
|
(12.5)
|
|
(3.6)
|
Adjusted EBITDA, net
to ENLK
|
$
|
243.7
|
|
$
|
207.6
|
Interest expense, net
of interest income
|
(43.7)
|
|
(44.5)
|
Amortization of
EnLink Oklahoma T.O. installment payable discount included in
interest expense (3)
|
0.5
|
|
7.0
|
Litigation settlement
adjustment (4)
|
—
|
|
(12.3)
|
Current taxes and
other
|
(0.9)
|
|
(0.6)
|
Maintenance capital
expenditures, net to ENLK (5)
|
(6.2)
|
|
(4.2)
|
Preferred unit
accrued cash distributions (6)
|
(22.2)
|
|
—
|
Distributable cash
flow
|
$
|
171.2
|
|
$
|
153.0
|
|
|
|
|
Actual declared
distribution to common unitholders
|
$
|
152.9
|
|
$
|
151.4
|
Distribution
coverage
|
1.12x
|
|
1.01x
|
Distributions
declared per limited partner unit
|
$
|
0.39
|
|
$
|
0.39
|
|
|
(1)
|
Includes accretion
expense associated with asset retirement obligations and non-cash
rent, which relates to lease incentives pro-rated over the lease
term.
|
(2)
|
Non-controlling
interest share of adjusted EBITDA includes ENLC's 16.1% share of
adjusted EBITDA from EnLink Oklahoma T.O., NGP Natural Resources
XI, L.P.'s ("NGP") 49.9% share of adjusted EBITDA from the Delaware
Basin JV, Marathon Petroleum's 50% share of adjusted EBITDA from
the Ascension JV, and other minor non-controlling
interests.
|
(3)
|
Amortization of the
EnLink Oklahoma T.O. installment payable discount is considered
non-cash interest under the ENLK credit facility since the payment
under the payable is consideration for the acquisition of the
EnLink Oklahoma T.O. assets.
|
(4)
|
Represents recoveries
from a lawsuit settled in 2017 for amounts not previously deducted
from distributable cash flow.
|
(5)
|
Excludes maintenance
capital expenditures that were contributed by other entities and
relate to the non-controlling interest share of our consolidated
entities.
|
(6)
|
Represents the cash
distributions earned by the Series B Preferred Units of $16.2
million and $6.0 million earned by the Series C Preferred Units for
the three months ended March 31, 2018. Cash distributions to
be paid to holders of the Series B Preferred Units and Series C
Preferred Units are not available to common unitholders.
|
EnLink Midstream
Partners, LP
|
Reconciliation of
Net Cash Provided by Operating Activities to Adjusted
EBITDA
|
and Distributable
Cash Flow
|
(All amounts in
millions)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2018
|
|
2017
|
Net cash provided by
operating activities
|
$
|
192.7
|
|
$
|
174.2
|
Interest expense, net
(1)
|
42.2
|
|
37.3
|
Current income
tax
|
1.0
|
|
0.8
|
Distributions from
unconsolidated affiliate investment in excess of
earnings
|
1.4
|
|
2.9
|
Other (2)
|
1.8
|
|
0.9
|
Changes in operating
assets and liabilities which (provided) used cash:
|
|
|
|
Accounts receivable,
accrued revenues, inventories and other
|
55.6
|
|
(19.4)
|
Accounts payable,
accrued gas and crude oil purchases and other (3)
|
(38.5)
|
|
14.5
|
Adjusted EBITDA
before non-controlling interest
|
$
|
256.2
|
|
$
|
211.2
|
Non-controlling
interest share of adjusted EBITDA (4)
|
(12.5)
|
|
(3.6)
|
Adjusted EBITDA, net
to ENLK
|
$
|
243.7
|
|
$
|
207.6
|
Interest expense, net
of interest income
|
(43.7)
|
|
(44.5)
|
Amortization of
EnLink Oklahoma T.O. installment payable discount included in
interest expense (5)
|
0.5
|
|
7.0
|
Litigation settlement
adjustment (6)
|
—
|
|
(12.3)
|
Current taxes and
other
|
(0.9)
|
|
(0.6)
|
Maintenance capital
expenditures, net to ENLK (7)
|
(6.2)
|
|
(4.2)
|
Preferred unit
accrued cash distributions (8)
|
(22.2)
|
|
—
|
Distributable cash
flow
|
$
|
171.2
|
|
$
|
153.0
|
|
|
(1)
|
Net of amortization
of debt issuance costs and discount and premium, which are included
in interest expense but not included in net cash provided by
operating activities.
|
(2)
|
Includes non-cash
rent, which relates to lease incentives pro-rated over the lease
term, and accruals for settled commodity swap
transactions.
|
(3)
|
Net of payments under
onerous performance obligation offset to other current and
long-term liabilities.
|
(4)
|
Non-controlling
interest share of adjusted EBITDA includes ENLC's 16% share of
adjusted EBITDA from EnLink Oklahoma T.O., NGP's 49.9% share of
adjusted EBITDA from the Delaware Basin JV, Marathon Petroleum's
50% share of adjusted EBITDA from the Ascension JV, and other minor
non-controlling interests.
|
(5)
|
Amortization of the
EnLink Oklahoma T.O. installment payable discount is considered
non-cash interest under the ENLK credit facility since the payment
under the payable is consideration for the acquisition of the
EnLink Oklahoma T.O. assets.
|
(6)
|
Represents recoveries
from a lawsuit settled in 2017 for amounts not previously deducted
from distributable cash flow.
|
(7)
|
Excludes maintenance
capital expenditures that were contributed by other entities and
relate to the non-controlling interest share of our consolidated
entities.
|
(8)
|
Represents the cash
distributions earned by the Series B Preferred Units of $16.2
million and $6.0 million earned by the Series C Preferred Units for
the three months ended March 31, 2018. Cash distributions to
be paid to holders of the Series B Preferred Units and Series C
Preferred Units are not available to common unitholders.
|
EnLink Midstream
Partners, LP
|
Operating
Data
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2018
|
|
2017
|
Midstream
Volumes:
|
|
|
|
Texas
Segment
|
|
|
|
Gathering and
Transportation (MMBtu/d)
|
2,190,800
|
|
2,274,100
|
Processing
(MMBtu/d)
|
1,194,100
|
|
1,162,100
|
Louisiana
Segment
|
|
|
|
Gathering and
Transportation (MMBtu/d)
|
2,222,900
|
|
1,931,300
|
Processing
(MMBtu/d)
|
441,900
|
|
467,800
|
NGL Fractionation
(Gals/d)
|
6,343,500
|
|
5,245,500
|
Oklahoma
Segment
|
|
|
|
Gathering and
Transportation (MMBtu/d)
|
1,047,900
|
|
705,500
|
Processing
(MMBtu/d)
|
1,069,400
|
|
652,800
|
Crude and
Condensate Segment
|
|
|
|
Crude Oil Handling
(Bbls/d)
|
127,700
|
|
110,400
|
Brine Disposal
(Bbls/d)
|
2,800
|
|
4,300
|
EnLink Midstream,
LLC
|
Selected Financial
Data
|
(All amounts in
millions except per unit amounts)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2018
|
|
2017
|
Total
revenues
|
$
|
1,761.7
|
|
|
$
|
1,321.9
|
|
Cost of
sales
|
1,381.5
|
|
|
1,002.3
|
|
Gross operating
margin
|
380.2
|
|
|
319.6
|
|
Operating costs and
expenses, excluding cost of sales:
|
|
|
|
Operating
expenses
|
109.2
|
|
|
104.1
|
|
General and
administrative
|
27.5
|
|
|
36.1
|
|
Loss on disposition
of assets
|
0.1
|
|
|
5.1
|
|
Depreciation and
amortization
|
138.1
|
|
|
128.3
|
|
Impairments
|
—
|
|
|
7.0
|
|
Gain on litigation
settlement
|
—
|
|
|
(17.5)
|
|
Total
operating costs and expenses, excluding cost of sales
|
274.9
|
|
|
263.1
|
|
Operating
income
|
105.3
|
|
|
56.5
|
|
Other income
(expense):
|
|
|
|
Interest expense, net
of interest income
|
(44.5)
|
|
|
(44.9)
|
|
Income from
unconsolidated affiliates
|
3.0
|
|
|
0.7
|
|
Other
income
|
0.3
|
|
|
—
|
|
Total other
expense
|
(41.2)
|
|
|
(44.2)
|
|
Income before
non-controlling interest and income taxes
|
64.1
|
|
|
12.3
|
|
Income tax
provision
|
(7.0)
|
|
|
(3.0)
|
|
Net income
|
57.1
|
|
|
9.3
|
|
Net income
attributable to non-controlling interest
|
44.7
|
|
|
11.2
|
|
Net income (loss)
attributable to ENLC
|
$
|
12.4
|
|
|
$
|
(1.9)
|
|
Net income (loss)
attributable to ENLC per unit:
|
|
|
|
Basic common
unit
|
$
|
0.07
|
|
|
$
|
(0.01)
|
|
Diluted common
unit
|
$
|
0.07
|
|
|
$
|
(0.01)
|
|
EnLink Midstream,
LLC
|
Cash Available for
Distribution and Calculation of Coverage Ratio
|
(All amounts in
millions except ratios and per unit amounts)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2018
|
|
2017
|
Distribution declared
by ENLK associated with (1):
|
|
|
|
General partner
interest
|
$
|
0.6
|
|
$
|
0.6
|
Incentive
distribution rights
|
14.8
|
|
14.7
|
ENLK common units
owned
|
34.5
|
|
34.5
|
Total share of
ENLK distributions declared
|
$
|
49.9
|
|
$
|
49.8
|
Adjusted EBITDA of
EnLink Oklahoma T.O. (2)
|
8.9
|
|
2.6
|
Total cash
available
|
$
|
58.8
|
|
$
|
52.4
|
Uses of
cash:
|
|
|
|
General and
administrative expenses
|
(1.2)
|
|
(1.0)
|
Current income taxes
(3)
|
(0.1)
|
|
—
|
Interest
expense
|
(0.8)
|
|
(0.4)
|
Maintenance capital
expenditures (4)
|
(0.1)
|
|
—
|
Total cash
used
|
$
|
(2.2)
|
|
$
|
(1.4)
|
ENLC cash available
for distribution
|
$
|
56.6
|
|
$
|
51.0
|
|
|
|
|
Actual declared
distribution to common unitholders
|
$
|
48.2
|
|
$
|
46.7
|
Distribution
coverage
|
1.18x
|
|
1.09x
|
Distributions
declared per ENLC unit
|
$
|
0.263
|
|
$
|
0.255
|
|
|
(1)
|
Represents
distributions declared by ENLK and to be paid to ENLC on
May 14, 2018 and distributions paid by ENLK to ENLC on
May 12, 2017.
|
(2)
|
Represents ENLC's
interest in EnLink Oklahoma T.O. adjusted EBITDA, which is
disbursed to ENLC by EnLink Oklahoma T.O. on a monthly basis.
EnLink Oklahoma T.O. adjusted EBITDA is defined as earnings before
depreciation and amortization and provision for income taxes and
includes allocated expenses from ENLK.
|
(3)
|
Represents ENLC's
stand-alone current tax expense.
|
(4)
|
Represents ENLC's
interest in EnLink Oklahoma T.O.s' maintenance capital expenditures
which is netted against the monthly disbursement of EnLink Oklahoma
T.O.s' adjusted EBITDA per (2) above.
|
EnLink Midstream,
LLC
|
Reconciliation of
Net Income of ENLC to ENLC Cash Available for
Distribution
|
(All amounts in
millions)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2018
|
|
2017
|
Net income of
ENLC
|
$
|
57.1
|
|
|
$
|
9.3
|
|
Less: Net income
attributable to ENLK
|
60.1
|
|
|
18.1
|
|
Net loss of ENLC
excluding ENLK
|
$
|
(3.0)
|
|
|
$
|
(8.8)
|
|
ENLC's share of
distributions from ENLK (1)
|
49.9
|
|
|
49.8
|
|
ENLC's interest in
EnLink Oklahoma T.O.'s non-cash expenses (2)
|
4.7
|
|
|
4.0
|
|
ENLC deferred income
tax expense (3)
|
5.8
|
|
|
2.5
|
|
Non-controlling
interest share of ENLK's net income (4)
|
(0.7)
|
|
|
3.4
|
|
Other items
(5)
|
(0.1)
|
|
|
0.1
|
|
ENLC cash available
for distribution
|
$
|
56.6
|
|
|
$
|
51.0
|
|
|
|
(1)
|
Represents
distributions declared by ENLK and to be paid to ENLC on
May 14, 2018 and distributions paid by ENLK to ENLC on
May 12, 2017.
|
(2)
|
Includes depreciation
and amortization and unit-based compensation expense allocated to
EnLink Oklahoma T.O.
|
(3)
|
Represents ENLC's
stand-alone deferred taxes.
|
(4)
|
Represents NGP's
49.9% share of the Delaware Basin JV, Marathon Petroleum's 50%
share of the Ascension JV, and other minor non-controlling
interests.
|
(5)
|
Represents ENLC's
interest in EnLink Oklahoma T.O.s' maintenance capital expenditures
(which is netted against the monthly disbursement of EnLink
Oklahoma T.O.s' adjusted EBITDA) and other non-cash items not
included in cash available for distribution.
|
EnLink Midstream
Partners, LP
|
Forward-Looking
Reconciliation of Net Income to Adjusted EBITDA and Distributable
Cash Flow (1)
|
(All amounts in
millions)
|
(Unaudited)
|
|
|
2018
Outlook
|
|
Low
|
|
Midpoint
|
|
High
|
Net income
(2)
|
$
|
255
|
|
|
$
|
285
|
|
|
$
|
315
|
|
Interest expense, net
of interest income
|
175
|
|
|
179
|
|
|
183
|
|
Depreciation and
amortization
|
554
|
|
|
564
|
|
|
574
|
|
Income from
unconsolidated affiliate investments
|
(19)
|
|
|
(20)
|
|
|
(21)
|
|
Distribution from
unconsolidated affiliate investments
|
16
|
|
|
17
|
|
|
18
|
|
Unit-based
compensation
|
42
|
|
|
37
|
|
|
32
|
|
Income
taxes
|
4
|
|
|
5
|
|
|
6
|
|
Payments under
onerous performance obligation offset to other current and
long-term liabilities
|
(18)
|
|
|
(18)
|
|
|
(18)
|
|
Adjusted EBITDA
before non-controlling interest
|
$
|
1,009
|
|
|
$
|
1,049
|
|
|
$
|
1,089
|
|
Non-controlling
interest share of adjusted EBITDA (3)
|
(59)
|
|
|
(64)
|
|
|
(69)
|
|
Adjusted EBITDA, net
to ENLK
|
$
|
950
|
|
|
$
|
985
|
|
|
$
|
1,020
|
|
Interest expense, net
of interest income
|
(175)
|
|
|
(179)
|
|
|
(183)
|
|
Preferred unit
accrued cash distributions
|
(89)
|
|
|
(89)
|
|
|
(89)
|
|
Current taxes and
other
|
(1)
|
|
|
(5)
|
|
|
(8)
|
|
Maintenance capital
expenditures, net to ENLK
|
(55)
|
|
|
(57)
|
|
|
(60)
|
|
Distributable cash
flow
|
$
|
630
|
|
|
$
|
655
|
|
|
$
|
680
|
|
|
|
(1)
|
The forecasted net
income guidance for the year ended December 31, 2018 excludes the
potential impact of gains or losses on derivative activity, gains
or losses on disposition of assets, impairment expense, gains or
losses as a result of legal settlements, gains or losses on
extinguishment of debt, and the financial effects of future
acquisitions. The exclusion of these items is due to the
uncertainty regarding the occurrence, timing, and/or amount of
these events.
|
|
|
|
EnLink Midstream does
not provide a reconciliation of forward-looking Net Cash Provided
by Operating Activities to Adjusted EBITDA because the companies
are unable to predict with reasonable certainty changes in working
capital, which may impact cash provided or used during the year.
Working capital includes accounts receivable, accounts payable and
other current assets and liabilities. These items are uncertain and
depend on various factors outside the companies'
control.
|
|
|
(2)
|
Net income includes
estimated net income attributable to ENLK's non-controlling
interest in ENLC's 16.1% share of net income from EnLink Oklahoma
T.O., NGP's 49.9% share of net income from the Delaware Basin JV,
and Marathon's 50% share of net income from the Ascension
JV.
|
|
|
(3)
|
Non-controlling
interest share of adjusted EBITDA includes ENLC's 16.1% share of
adjusted EBITDA from EnLink Oklahoma T.O., NGP's 49.9% share of
adjusted EBITDA from the Delaware Basin JV, Marathon Petroleum's
50% share of adjusted EBITDA from the Ascension JV, and other minor
non-controlling interests.
|
EnLink Midstream,
LLC
|
Forward-Looking
Reconciliation of Net Income of ENLC to ENLC Cash Available for
Distribution (1)
|
(All amounts in
millions)
|
(Unaudited)
|
|
|
2018
Outlook
|
|
Low
|
|
Midpoint
|
|
High
|
Net income of ENLC
(2)
|
$
|
233
|
|
|
$
|
262
|
|
|
$
|
291
|
|
Less: Net income
attributable to ENLK (3)
|
(225)
|
|
|
(250)
|
|
|
(275)
|
|
Net income of ENLC
excluding ENLK
|
$
|
8
|
|
|
$
|
12
|
|
|
$
|
16
|
|
ENLC's share of
distributions from ENLK (4)
|
201
|
|
|
201
|
|
|
201
|
|
ENLC's interest in
EnLink Oklahoma T.O. depreciation
|
19
|
|
|
19
|
|
|
19
|
|
Non-controlling
interest share of ENLK's net income (5)
|
(11)
|
|
|
(11)
|
|
|
(11)
|
|
ENLC deferred income
tax expense (6)
|
14
|
|
|
15
|
|
|
16
|
|
Maintenance capital
expenditures (7)
|
(1)
|
|
|
(1)
|
|
|
(1)
|
|
ENLC cash available
for distribution
|
$
|
230
|
|
|
$
|
235
|
|
|
$
|
240
|
|
|
|
(1)
|
The forecasted net
income guidance for the year ended December 31, 2018 excludes the
potential impact of gains or losses on derivative activity, gains
or losses on disposition of assets, impairment expense, gains or
losses as a result of legal settlements, gains or losses on
extinguishment of debt, and the financial effects of future
acquisitions. The exclusion of these items is due to the
uncertainty regarding the occurrence, timing, and/or amount of
these events.
|
(2)
|
Net income of ENLC
includes estimated net income attributable to ENLC's
non-controlling interest in ENLK.
|
(3)
|
Net income
attributable to ENLK is net of the estimated non-controlling
interest share attributable to the Delaware Basin JV, Ascension JV,
and EnLink Oklahoma T.O.
|
(4)
|
Represents quarterly
distributions estimated to be paid to ENLC by ENLK for
2018.
|
(5)
|
Represents estimated
net income for NGP's 49.9% share of the Delaware Basin JV, Marathon
Petroleum's 50% share of the Ascension JV, and other minor
non-controlling interests.
|
(6)
|
Represents ENLC's
estimated stand-alone deferred taxes for 2018.
|
(7)
|
Represents 2018
maintenance capital expenditures attributable to ENLC's share of
EnLink Oklahoma T.O.
|
Investor Relations: Kate
Walsh, Vice President of Investor Relations, 214-721-9696,
kate.walsh@enlink.com
Media Relations: Jill
McMillan, Vice President of Public & Industry
Affairs, 214-721-9271, jill.mcmillan@enlink.com
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SOURCE EnLink Midstream