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Western Gas Announces First-Quarter 2014 Results
05/06/2014

HOUSTON, TX -- (Marketwired) -- 05/06/14 -- Western Gas Partners, LP (NYSE: WES) ("WES" or the "Partnership") and Western Gas Equity Partners, LP (NYSE: WGP) ("WGP") today announced first-quarter 2014 financial and operating results.

WESTERN GAS PARTNERS, LP

Net income available to limited partners for the first quarter of 2014 totaled $63.6 million, or $0.54 per common unit (diluted). For the first quarter of 2014, Adjusted EBITDA(1) was $141.0 million and Distributable cash flow(1) was $119.3 million, resulting in a Coverage ratio(1) of 1.21 times.

Total throughput attributable to WES for natural gas assets for the first quarter of 2014 averaged 3.4 Bcf/d, which was 2% below the prior quarter and 17% above the first quarter of 2013. The prior quarter's reported throughput included 112 MMcf/d of volumes reported as both gathered by the Partnership's Wattenberg system and processed by the Partnership's Platte Valley system. After combining these two systems into the DJ Basin complex in the first quarter of 2014, these volumes are reported only once as processing volumes. Adjusted for comparability, the Partnership's first-quarter reported throughput would have been 2% higher than the prior quarter.

Capital expenditures attributable to WES including equity investments, but excluding acquisitions, on a cash basis totaled $213.3 million during the first quarter of 2014. Of this amount, maintenance capital expenditures were $8.8 million, or 6% of Adjusted EBITDA(1). Also including equity investments, but excluding acquisitions, capital expenditures attributable to WES on an accrual basis totaled $189.1 million during the first quarter of 2014.

"While 2014 began with tough weather conditions in the Rockies, our resilient portfolio once again delivered strong performance," said Chief Executive Officer, Don Sinclair. "This year is off to a solid start with our Brasada plant in the Eagleford now operating at or above 90% capacity and our newLancaster plant in the DJ Basin complex commencing operations in early April."

 

 

(1)

Please see the tables at the end of this release for a reconciliation of non-GAAP to GAAP measures and calculation of the Coverage ratio.

 

 

 

WES previously declared a quarterly distribution of $0.625 per unit for the first quarter of 2014, representing a 4% increase over the prior quarter's distribution and a 16% increase over the first-quarter 2013 distribution of $0.54 per unit. The distribution will be paid on May 14, 2014, to unitholders of record at the close of business on April 30, 2014. The first-quarter 2014 Coverage ratio(1) of 1.21 times is based on the quarterly distribution of $0.625 per unit.

WESTERN GAS EQUITY PARTNERS, LP

As of March 31, 2014, WGP indirectly owned the 2% general partner interest in WES, 100% of the incentive distribution rights in WES and 49,296,205 WES common units. Net income available to limited partners for the first quarter of 2014 totaled $50.5 million, or $0.23 per common unit (diluted).

WGP previously declared a quarterly distribution of $0.25 per unit for the first quarter of 2014, representing an 8% increase over the prior quarter's distribution and a 40% increase over the first-quarter 2013 distribution of $0.17875. The distribution will be paid on May 23, 2014, to unitholders of record at the close of business on April 30, 2014. WGP will receive distributions from WES of $55.9 million attributable to the first quarter and will pay out $54.7 million in distributions for the same period.

CONFERENCE CALL TOMORROW AT 11 A.M. CDT

WES and WGP will host a joint conference call on Wednesday, May 7, 2014, at 11:00 a.m. Central Daylight Time (12:00 p.m. Eastern Daylight Time) to discuss first-quarter 2014 results. To participate via telephone, please dial 877.621.4819 and enter participant code 23292162. Please call in 10 minutes prior to the scheduled start time. To access the live audio webcast of the conference call and slide presentation, please visit www.westerngas.com. A replay of the call will also be available on the website for approximately two weeks following the conference call.

 

 

(1)

Please see the tables at the end of this release for a reconciliation of non-GAAP to GAAP measures and calculation of the Coverage ratio.

 

 

 

Western Gas Partners, LP ("WES") is a growth-oriented Delaware master limited partnership formed byAnadarko Petroleum Corporation to own, operate, acquire and develop midstream energy assets. With midstream assets in the Rocky Mountains, the Mid-Continent, north-central Pennsylvania and Texas, WES is engaged in the business of gathering, processing, compressing, treating and transporting natural gas, condensate, natural gas liquids and crude oil for Anadarko and other producers and customers.

Western Gas Equity Partners, LP ("WGP") is a Delaware master limited partnership formed by Anadarko to own the following types of interests in WES: (i) the 2.0% general partner interest and all of the incentive distribution rights in WES, both owned through WGP's 100% ownership of WES's general partner, and (ii) a significant limited partner interest in WES.

For more information about Western Gas Partners, LP and Western Gas Equity Partners, LP, please visit www.westerngas.com.

This news release contains forward-looking statements. Western Gas Partners and Western Gas Equity Partners believe that their expectations are based on reasonable assumptions. No assurance, however, can be given that such expectations will prove to have been correct. A number of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this news release. These factors include the ability to meet financial guidance or distribution growth expectations; the ability to safely and efficiently operate WES's assets; the ability to obtain new sources of natural gas supplies; the effect of fluctuations in commodity prices and the demand for natural gas and related products; the ability to meet projected in-service dates for capital growth projects; construction costs or capital expenditures exceeding estimated or budgeted costs or expenditures; and the other factors described in the "Risk Factors" sections of WES's and WGP's most recent Forms 10-K filed with the Securities and Exchange Commission and in their other public filings and press releases. Western Gas Partners and Western Gas Equity Partners undertake no obligation to publicly update or revise any forward-looking statements.

Western Gas Partners, LP Reconciliation of GAAP to Non-GAAP Measures

Below are reconciliations of (i) WES's Distributable cash flow (non-GAAP) to net income attributable toWestern Gas Partners, LP (GAAP), (ii) Adjusted EBITDA attributable to Western Gas Partners, LP("Adjusted EBITDA") (non-GAAP) to net income attributable to Western Gas Partners, LP (GAAP) and to net cash provided by operating activities (GAAP), and (iii) Adjusted gross margin attributable to Western Gas Partners, LP ("Adjusted gross margin") (non-GAAP) to operating income (GAAP), as required under Regulation G of the Securities Exchange Act of 1934. Management believes that WES's Distributable cash flow, Adjusted EBITDA, Adjusted gross margin, and Coverage ratio are widely accepted financial indicators of WES's financial performance compared to other publicly traded partnerships and are useful in assessing its ability to incur and service debt, fund capital expenditures and make distributions. Distributable cash flow, Adjusted EBITDA, Adjusted gross margin and Coverage ratio, as defined by WES, may not be comparable to similarly titled measures used by other companies. Therefore, WES's Distributable cash flow, Adjusted EBITDA, Adjusted gross margin, and Coverage ratio should be considered in conjunction with net income and other applicable performance measures, such as operating income or cash flows from operating activities.

Distributable Cash Flow

WES defines Distributable cash flow as Adjusted EBITDA, plus interest income, less net cash paid for interest expense (including amortization of deferred debt issuance costs originally paid in cash, offset by non-cash capitalized interest), maintenance capital expenditures, and income taxes.

 

 

 

 

 

Three Months Ended
March 31,

thousands except Coverage ratio

 

2014

 

 

 

2013 (1)

Reconciliation of Net income attributable to Western Gas Partners, LP to Distributable cash flow and calculation of the Coverage ratio

 

 

 

 

 

 

 

 

Net income attributable to Western Gas Partners, LP

 

$

87,435

 

 

 

$

50,714

Add:

 

 

 

 

 

 

 

 

 

Distributions from equity investees

 

 

12,313

 

 

 

 

5,006

 

Non-cash equity-based compensation expense

 

 

1,097

 

 

 

 

877

 

Income tax (benefit) expense

 

 

(228

)

 

 

 

4,166

 

Depreciation, amortization and impairments (2)

 

 

39,975

 

 

 

 

31,824

Less:

 

 

 

 

 

 

 

 

 

Equity income, net

 

 

9,251

 

 

 

 

3,968

 

Cash paid for maintenance capital expenditures (2)

 

 

8,842

 

 

 

 

6,032

 

Capitalized interest

 

 

3,440

 

 

 

 

3,181

 

Cash paid for (reimbursement of) income taxes

 

 

(340

)

 

 

 

--

 

Other income (2) (3)

 

 

78

 

 

 

 

277

Distributable cash flow

 

$

119,321

 

 

 

$

79,129

 

 

 

 

 

 

 

 

 

Distributions declared(4)

 

 

 

 

 

 

 

 

 

Limited partners

 

$

73,708

 

 

 

 

 

 

General partner

 

 

25,041

 

 

 

 

 

 

Total

 

$

98,749

 

 

 

 

 

Coverage ratio

 

 

1.21

 

x

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Financial information has been recast to include the financial position and results attributable to the 20% interest in each of Texas Express Pipeline LLC ("TEP") and Texas Express Gathering LLC ("TEG") and a 33.33% interest in Front Range Pipeline LLC ("FRP") acquired from Anadarko (collectively, the "TEFR Interests").

(2)

Includes WES's 75% share of depreciation, amortization and impairments; cash paid for maintenance capital expenditures; and other income attributable to Chipeta.

(3)

Excludes income of $0.4 million for each of the three months ended March 31, 2014 and 2013, related to a component of a gas processing agreement accounted for as a capital lease.

(4)

Reflects distributions of $0.625 per unit declared for the three months ended March 31, 2014.

 

 

 

 

 

Western Gas Partners, LP Reconciliation of GAAP to Non-GAAP Measures, continued

Adjusted EBITDA Attributable to Western Gas Partners, LP

WES defines Adjusted EBITDA as net income (loss) attributable to Western Gas Partners, LP, plus distributions from equity investees, non-cash equity-based compensation expense, interest expense, income tax expense, depreciation, amortization and impairments, and other expense, less income from equity investments, interest income, income tax benefit, and other income.

 

 

 

 

 

 

Three Months Ended
March 31,

 

thousands

 

2014

 

 

2013 (1)

 

Reconciliation of Net income attributable to Western Gas Partners, LP to Adjusted EBITDA attributable to Western Gas Partners, LP

 

 

 

 

 

 

 

 

Net income attributable to Western Gas Partners, LP

 

$

87,435

 

 

$

50,714

 

Add:

 

 

 

 

 

 

 

 

 

Distributions from equity investees

 

 

12,313

 

 

 

5,006

 

 

Non-cash equity-based compensation expense

 

 

1,097

 

 

 

877

 

 

Interest expense

 

 

13,961

 

 

 

11,811

 

 

Income tax expense

 

 

--

 

 

 

4,166

 

 

Depreciation, amortization and impairments (2)

 

 

39,975

 

 

 

31,824

 

Less:

 

 

 

 

 

 

 

 

 

Equity income, net

 

 

9,251

 

 

 

3,968

 

 

Interest income, net - affiliates

 

 

4,225

 

 

 

4,225

 

 

Other income (2) (3)

 

 

78

 

 

 

277

 

 

Income tax benefit

 

 

228

 

 

 

--

 

Adjusted EBITDA attributable to Western Gas Partners, LP

 

$

140,999

 

 

$

95,928

 

 

 

Reconciliation of Adjusted EBITDA attributable to Western Gas Partners, LP to Net cash provided by operating activities

 

 

 

 

 

 

 

 

Adjusted EBITDA attributable to Western Gas Partners, LP

 

$

140,999

 

 

$

95,928

 

Adjusted EBITDA attributable to noncontrolling interest

 

 

4,326

 

 

 

2,846

 

 

Interest income (expense), net

 

 

(9,736

)

 

 

(7,586

)

 

Non-cash equity-based compensation expense

 

 

53

 

 

 

(73

)

 

Debt-related amortization and other items, net

 

 

680

 

 

 

560

 

 

Current income tax benefit

 

 

518

 

 

 

5,104

 

 

Other income (expense), net (3)

 

 

81

 

 

 

278

 

 

Distributions from equity investments in excess of cumulative earnings

 

 

(2,044

)

 

 

--

 

 

Changes in operating working capital:

 

 

 

 

 

 

 

 

 

 

Accounts receivable, net

 

 

(10,982

)

 

 

21,661

 

 

 

Accounts and natural gas imbalance payables and accrued liabilities, net

 

 

(1,727

)

 

 

21,287

 

 

 

Other

 

 

1,878

 

 

 

(1,835

)

Net cash provided by operating activities

 

$

124,046

 

 

$

138,170

 

 

 

 

 

 

 

 

 

 

Cash flow information of Western Gas Partners, LP

 

 

 

 

 

 

 

 

Net cash provided by operating activities

 

$

124,046

 

 

$

138,170

 

Net cash used in investing activities

 

$

(576,697

)

 

$

(831,633

)

Net cash provided by financing activities

 

$

435,014

 

 

$

336,998

 

 

 

 

 

 

 

 

 

 

 

(1)

Financial information has been recast to include the financial position and results attributable to the TEFR Interests.

(2)

Includes WES's 75% share of depreciation, amortization and impairments; and other income attributable to Chipeta.

(3)

Excludes income of $0.4 million for each of the three months ended March 31, 2014 and 2013, related to a component of a gas processing agreement accounted for as a capital lease.

 

 

 

 

 

Western Gas Partners, LP Reconciliation of GAAP to Non-GAAP Measures, continued

Adjusted gross margin attributable to Western Gas Partners, LP

WES defines Adjusted gross margin as total revenues less cost of product, plus distributions from equity investees and excluding the noncontrolling interest owner's proportionate share of revenue and cost of product.

 

 

 

 

 

Three Months Ended
March 31,

thousands

 

2014

 

2013 (1)

Reconciliation of Adjusted gross margin attributable to Western Gas Partners, LP to Operating income

 

 

 

 

 

 

 

Adjusted gross margin attributable to Western Gas Partners, LP for natural gas assets

 

$

183,937

 

$

140,395

 

Adjusted gross margin for crude/NGL assets

 

 

10,789

 

 

3,591

Adjusted gross margin attributable to Western Gas Partners, LP

 

$

194,726

 

$

143,986

Adjusted gross margin attributable to noncontrolling interest

 

 

5,094

 

 

3,703

Equity income, net

 

 

9,251

 

 

3,968

Less:

 

 

 

 

 

 

 

Distributions from equity investees

 

 

12,313

 

 

5,006

 

Operation and maintenance

 

 

40,532

 

 

36,739

 

General and administrative

 

 

8,415

 

 

7,664

 

Property and other taxes

 

 

7,041

 

 

5,785

 

Depreciation, amortization and impairments

 

 

40,612

 

 

32,440

Operating income

 

$

100,158

 

$

64,023

 

 

 

 

 

 

 

 

(1)

Financial information has been recast to include the financial position and results attributable to the TEFR Interests.

 

 

 

 

 

 

 

Western Gas Partners, LP

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

 

(Unaudited)

 

 

 

 

 

Three Months Ended
March 31,

 

thousands except per-unit amounts

 

2014

 

 

2013 (1)

 

 

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

Gathering, processing and transportation of natural gas and natural gas liquids

 

$

141,449

 

 

$

102,890

 

Natural gas, natural gas liquids and condensate sales

 

 

136,438

 

 

 

121,729

 

Other, net

 

 

1,570

 

 

 

1,147

 

Total revenues

 

 

279,457

 

 

 

225,766

 

 

 

 

 

 

 

 

 

 

Equity income, net

 

 

9,251

 

 

 

3,968

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

Cost of product

 

 

91,950

 

 

 

83,083

 

Operation and maintenance

 

 

40,532

 

 

 

36,739

 

General and administrative

 

 

8,415

 

 

 

7,664

 

Property and other taxes

 

 

7,041

 

 

 

5,785

 

Depreciation, amortization and impairments

 

 

40,612

 

 

 

32,440

 

Total operating expenses

 

 

188,550

 

 

 

165,711

 

Operating income

 

 

100,158

 

 

 

64,023

 

Interest income, net - affiliates

 

 

4,225

 

 

 

4,225

 

Interest expense

 

 

(13,961

)

 

 

(11,811

)

Other income

 

 

477

 

 

 

674

 

Income before income taxes

 

 

90,899

 

 

 

57,111

 

Income tax (benefit) expense

 

 

(228

)

 

 

4,166

 

Net income

 

 

91,127

 

 

 

52,945

 

Net income attributable to noncontrolling interest

 

 

3,692

 

 

 

2,231

 

Net income attributable to Western Gas Partners, LP

 

$

87,435

 

 

$

50,714

 

Limited partners' interest in net income:

 

 

 

 

 

 

 

 

Net income attributable to Western Gas Partners, LP

 

$

87,435

 

 

$

50,714

 

Pre-acquisition net (income) loss allocated to Anadarko

 

 

956

 

 

 

(5,458

)

General partner interest in net (income) loss

 

 

(24,834

)

 

 

(12,886

)

Limited partners' interest in net income

 

$

63,557

 

 

$

32,370

 

 

 

 

 

 

 

 

 

 

Net income per common unit - basic and diluted

 

$

0.54

 

 

$

0.31

 

Weighted average common units outstanding - basic and diluted

 

 

117,716

 

 

 

104,815

 

 

 

 

 

 

 

 

 

 

 

(1)

Financial information has been recast to include the financial position and results attributable to the TEFR Interests.

 

 

 

 

 

 

 

Western Gas Partners, LP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

thousands except number of units

 

March 31,
2014

 

December 31,
2013(1)

 

 

 

 

 

 

 

Current assets

 

$

191,144

 

$

194,810

Note receivable - Anadarko

 

 

260,000

 

 

260,000

Net property, plant and equipment

 

 

3,519,478

 

 

3,383,255

Other assets

 

 

806,485

 

 

779,743

Total assets

 

$

4,777,107

 

$

4,617,808

 

 

 

 

 

 

 

Current liabilities

 

$

172,456

 

$

190,460

Long-term debt

 

 

1,912,839

 

 

1,418,169

Asset retirement obligations and other

 

 

80,278

 

 

117,143

Total liabilities

 

$

2,165,573

 

$

1,725,772

 

 

 

 

 

 

 

Equity and partners' capital

 

 

 

 

 

 

Common units (117,932,582 and 117,322,812 units issued and outstanding at March 31, 2014, and December 31, 2013, respectively)

 

$

2,459,637

 

$

2,431,193

General partner units (2,406,763 and 2,394,345 units issued and outstanding at March 31, 2014, and December 31, 2013, respectively)

 

 

81,735

 

 

78,157

Net investment by Anadarko

 

 

--

 

 

312,092

Noncontrolling interest

 

 

70,162

 

 

70,594

Total liabilities, equity and partners' capital

 

$

4,777,107

 

$

4,617,808

 

 

 

 

 

 

 

 

(1)

Financial information has been recast to include the financial position and results attributable to the TEFR Interests.

 

 

 

 

 

 

 

Western Gas Partners, LP

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

(Unaudited)

 

 

 

 

 

Three Months Ended
March 31,

 

thousands

 

2014

 

 

2013 (1)

 

 

 

 

 

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

Net income

 

$

91,127

 

 

$

52,945

 

Adjustments to reconcile net income to net cash provided by operating activities and changes in working capital:

 

 

 

 

 

 

 

 

 

Depreciation, amortization and impairments

 

 

40,612

 

 

 

32,440

 

 

Change in other items, net

 

 

(7,693

)

 

 

52,785

 

Net cash provided by operating activities

 

$

124,046

 

 

$

138,170

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

Capital expenditures

 

$

(189,327

)

 

$

(166,463

)

Acquisitions from affiliates

 

 

(360,952

)

 

 

(465,721

)

Acquisitions from third parties

 

 

--

 

 

 

(134,869

)

Investments in equity affiliates

 

 

(27,605

)

 

 

(64,580

)

Distributions from equity investments in excess of cumulative earnings

 

 

2,044

 

 

 

--

 

Other

 

 

(857

)

 

 

--

 

Net cash used in investing activities

 

$

(576,697

)

 

$

(831,633

)

 

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

 

 

Borrowings, net of debt issuance costs

 

$

917,742

 

 

$

384,946

 

Repayments of debt

 

 

(430,000

)

 

 

--

 

Increase (decrease) in outstanding checks

 

 

1,928

 

 

 

(2,808

)

Proceeds from the issuance of common and general partner units, net of offering expenses

 

 

18,289

 

 

 

500

 

Distributions to unitholders

 

 

(92,609

)

 

 

(65,657

)

Contributions from noncontrolling interest owner

 

 

--

 

 

 

1,097

 

Distributions to noncontrolling interest owner

 

 

(4,124

)

 

 

(2,650

)

Net contributions from (distributions to) Anadarko

 

 

23,788

 

 

 

21,570

 

Net cash provided by financing activities

 

$

435,014

 

 

$

336,998

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents

 

$

(17,637

)

 

$

(356,465

)

Cash and cash equivalents at beginning of period

 

 

100,728

 

 

 

419,981

 

Cash and cash equivalents at end of period

 

$

83,091

 

 

$

63,516

 

 

 

 

 

 

 

 

 

 

 

(1)

Financial information has been recast to include the financial position and results attributable to the TEFR Interests.

 

 

 

 

 

 

 

Western Gas Partners, LP

OPERATING STATISTICS

(Unaudited)

 

 

 

Three Months Ended
March 31,

MMcf/d except throughput measured in barrels and per-unit amounts

 

2014

 

2013 (1)

 

 

 

 

 

 

 

Throughput for natural gas assets

 

 

 

 

 

 

 

Gathering, treating and transportation (2)

 

 

1,592

 

 

1,251

 

Processing (2)

 

 

1,799

 

 

1,609

 

Equity investment (3)

 

 

186

 

 

201

 

 

Total throughput for natural gas assets

 

 

3,577

 

 

3,061

 

Throughput attributable to noncontrolling interest for natural gas assets

 

 

173

 

 

155

 

Total throughput attributable to Western Gas Partners, LP for natural gas assets (4)

 

 

3,404

 

 

2,906

 

Total throughput (MBbls/d) for crude/NGL assets (5)

 

 

79

 

 

27

Adjusted gross margin per Mcf attributable to Western Gas Partners, LP for natural gas assets (6)

 

$

0.60

 

$

0.54

Adjusted gross margin per Bbl for crude/NGL assets (7)

 

$

1.52

 

$

1.48

 

 

 

 

 

 

 

                 
 

 

(1)

Throughput has been recast to include throughput attributable to the TEFR Interests.

(2)

The combination of WES's Wattenberg and Platte Valley systems in the first quarter of 2014 into the entity now referred to as the "DJ Basin complex" resulted in the following: (i) the Wattenberg system volumes previously reported as "Gathering, treating and transportation" are now reported as "Processing" for all periods presented, and (ii) volumes both gathered and processed by the two systems are no longer separately reported.

(3)

Represents WES's 14.81% share of average Fort Union and 22% share of average Rendezvous throughput. Excludes equity investment throughput measured in barrels (captured in "Total throughput (MBbls/d) for crude/NGL assets" as noted below).

(4)

Includes affiliate, third-party and equity investment throughput (as equity investment throughput is defined in the above footnote), excluding the noncontrolling interest owner's proportionate share of throughput.

(5)

Represents total throughput measured in barrels, consisting of throughput from our Chipeta NGL pipeline, our 10% share of average White Cliffs throughput, our 25% share of average Mont Belvieu JV throughput, our 20% share of average TEG and TEP throughput and our 33.33% share of average FRP throughput.

(6)

Average for period. Calculated as Adjusted gross margin attributable to Western Gas Partners, LP for natural gas assets (total revenues for natural gas assets less cost of product for natural gas assets plus distributions from our equity investments in Fort Union and Rendezvous, which are measured in Mcf) divided by total throughput attributable to Western Gas Partners, LP for natural gas assets.

(7)

Average for period. Calculated as Adjusted gross margin for crude/NGL assets (total revenues for crude/NGL assets less cost of product for crude/NGL assets plus distributions from our equity investments in White Cliffs, the Mont Belvieu JV, TEG, TEP and FRP, which are measured in barrels), divided by total throughput (MBbls/d) for crude/NGL assets.

 

 

 

 

 

 

 

Western Gas Equity Partners, LP

CALCULATION OF CASH AVAILABLE FOR DISTRIBUTION

(Unaudited)

 

 

 

Three Months Ended

thousands except per-unit amount and Coverage ratio

 

March 31, 2014

Distributions declared by Western Gas Partners, LP:

 

 

 

 

General partner interest

 

$

1,975

 

Incentive distribution rights

 

 

23,066

 

Common units held by WGP

 

 

30,810

Less:

 

 

 

 

Public company general and administrative expense

 

 

940

Cash available for distribution

 

$

54,911

 

 

 

 

Declared distribution per common unit

 

$

0.25000

 

 

 

 

Distributions declared by Western Gas Equity Partners, LP

 

$

54,726

 

 

 

 

 

 

 

 

Coverage ratio

 

 

1.00x

 

 

 

 

 

 

 

 

 

 

 

 

 

Western Gas Equity Partners, LP

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

 

(Unaudited)

 

 

 

 

 

Three Months Ended
March 31,

 

thousands except per-unit amounts

 

2014

 

 

2013 (1)

 

 

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

Gathering, processing and transportation of natural gas and natural gas liquids

 

$

141,449

 

 

$

102,890

 

Natural gas, natural gas liquids and condensate sales

 

 

136,438

 

 

 

121,729

 

Other, net

 

 

1,570

 

 

 

1,147

 

Total revenues

 

 

279,457

 

 

 

225,766

 

 

 

 

 

 

 

 

 

 

Equity income, net

 

 

9,251

 

 

 

3,968

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

Cost of product

 

 

91,950

 

 

 

83,083

 

Operation and maintenance

 

 

40,532

 

 

 

36,739

 

General and administrative

 

 

9,386

 

 

 

8,929

 

Property and other taxes

 

 

7,041

 

 

 

5,785

 

Depreciation, amortization and impairments

 

 

40,612

 

 

 

32,440

 

Total operating expenses

 

 

189,521

 

 

 

166,976

 

Operating income

 

 

99,187

 

 

 

62,758

 

Interest income, net - affiliates

 

 

4,225

 

 

 

4,225

 

Interest expense

 

 

(13,961

)

 

 

(11,811

)

Other income

 

 

496

 

 

 

727

 

Income before income taxes

 

 

89,947

 

 

 

55,899

 

Income tax (benefit) expense

 

 

(228

)

 

 

4,166

 

Net income

 

 

90,175

 

 

 

51,733

 

Net income attributable to noncontrolling interests

 

 

40,634

 

 

 

19,361

 

Net income attributable to Western Gas Equity Partners, LP

 

$

49,541

 

 

$

32,372

 

Limited partners' interest in net income:

 

 

 

 

 

 

 

 

Net income attributable to Western Gas Equity Partners, LP

 

$

49,541

 

 

$

32,372

 

Pre-acquisition net (income) loss allocated to Anadarko

 

 

956

 

 

 

(5,458

)

Limited partners' interest in net income

 

$

50,497

 

 

$

26,914

 

Net income per common unit - basic and diluted

 

$

0.23

 

 

$

0.12

 

Weighted average number of common units outstanding - basic and diluted

 

 

218,903

 

 

 

218,896

 

 

 

 

 

 

 

 

 

 

 

(1)

Financial information has been recast to include the financial position and results attributable to the TEFR Interests.

 

 

 

 

 

 

 

Western Gas Equity Partners, LP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

thousands except number of units

 

March 31,
2014

 

December 31,
2013(1)

 

 

 

 

 

 

 

Current assets

 

$

202,615

 

$

207,827

Note receivable - Anadarko

 

 

260,000

 

 

260,000

Net property, plant and equipment

 

 

3,519,478

 

 

3,383,255

Other assets

 

 

806,485

 

 

779,743

Total assets

 

$

4,788,578

 

$

4,630,825

 

 

 

 

 

 

 

Current liabilities

 

$

172,624

 

$

191,483

Long-term debt

 

 

1,912,839

 

 

1,418,169

Asset retirement obligations and other

 

 

80,278

 

 

117,143

Total liabilities

 

$

2,165,741

 

$

1,726,795

 

 

 

 

 

 

 

Equity and partners' capital

 

 

 

 

 

 

Common units (218,903,498 and 218,895,515 issued and outstanding at March 31, 2014, and December 31, 2013, respectively)

 

$

921,523

 

$

905,082

Net investment by Anadarko

 

 

--

 

 

312,092

Noncontrolling interests

 

 

1,701,314

 

 

1,686,856

Total liabilities, equity and partners' capital

 

$

4,788,578

 

$

4,630,825

 

 

 

 

 

 

 

 

(1)

Financial information has been recast to include the financial position and results attributable to the TEFR Interests.

 

 

 

 

 

 

 

Western Gas Equity Partners, LP

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

(Unaudited)

 

 

 

 

 

Three Months Ended
March 31,

 

thousands

 

2014

 

 

2013 (1)

 

 

 

 

 

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

Net income

 

$

90,175

 

 

$

51,733

 

Adjustments to reconcile net income to net cash provided by operating activities and changes in working capital:

 

 

 

 

 

 

 

 

 

Depreciation, amortization and impairments

 

 

40,612

 

 

 

32,440

 

 

Change in other items, net

 

 

(8,303

)

 

 

53,203

 

Net cash provided by operating activities

 

$

122,484

 

 

$

137,376

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

Capital expenditures

 

$

(189,327

)

 

$

(166,463

)

Acquisitions from affiliates

 

 

(360,952

)

 

 

(465,721

)

Acquisitions from third parties

 

 

--

 

 

 

(134,869

)

Investments in equity affiliates

 

 

(27,605

)

 

 

(64,580

)

Distributions from equity investments in excess of cumulative earnings

 

 

2,044

 

 

 

--

 

Other

 

 

(857

)

 

 

--

 

Net cash used in investing activities

 

$

(576,697

)

 

$

(831,633

)

 

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

 

 

Borrowings, net of debt issuance costs

 

$

917,742

 

 

$

384,946

 

Repayments of debt

 

 

(430,000

)

 

 

--

 

Increase (decrease) in outstanding checks

 

 

1,928

 

 

 

(2,808

)

Proceeds from the issuance of WES common units, net of offering expenses

 

 

17,530

 

 

 

--

 

Offering expenses from the issuance of WGP common units

 

 

--

 

 

 

(2,367

)

Contributions received from Chipeta noncontrolling interest owner

 

 

--

 

 

 

1,097

 

Distributions to Chipeta noncontrolling interest owner

 

 

(4,124

)

 

 

(2,650

)

Distributions to noncontrolling interest owners of WES

 

 

(40,996

)

 

 

(28,789

)

Distributions to WGP unitholders

 

 

(50,621

)

 

 

(7,852

)

Net contributions from (distributions to) Anadarko

 

 

23,788

 

 

 

21,588

 

Net cash provided by financing activities

 

$

435,247

 

 

$

363,165

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents

 

$

(18,966

)

 

$

(331,092

)

Cash and cash equivalents at beginning of period

 

 

113,085

 

 

 

422,556

 

Cash and cash equivalents at end of period

 

$

94,119

 

 

$

91,464

 

 

 

 

 

 

 

 

 

 

 

(1)

Financial information has been recast to include the financial position and results attributable to the TEFR Interests.

 

WESTERN GAS PARTNERS, LP and WESTERN GAS EQUITY PARTNERS, LP CONTACT:

Benjamin Fink, CFA
SVP, Chief Financial Officer and Treasurer
832.636.6010
Email Contact

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