WES
$51.46
Western Gas Partners LP
($.38)
(.73%)
Earnings Details
2nd Quarter June 2017
Tuesday, July 25, 2017 4:05:00 PM
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Summary

Western Gas Partners LP (WES) Recent Earnings

Western Gas Partners LP (WES) reported 2nd Quarter June 2017 earnings of $0.49 per share on revenue of $525.5 million. The consensus earnings estimate was $0.53 per share on revenue of $510.2 million. Revenue grew 22.6% on a year-over-year basis.

Western Gas Partners, LP is engaged in gathering, processing, compressing, treating and transporting natural gas, condensate, NGLs and crude oil for its subsidiaries as well as third-party producers and customers.

Results
Reported Earnings
$0.49
Earnings Whisper
-
Consensus Estimate
$0.53
Reported Revenue
$525.5 Mil
Revenue Estimate
$510.2 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Western Gas Announces Second-Quarter 2017 Results

Western Gas Partners, LP (WES) ("WES" or the "Partnership") and Western Gas Equity Partners, LP (WGP) ("WGP") today announced second-quarter 2017 financial and operating results.

WESTERN GAS PARTNERS, LP Net income (loss) available to limited partners for the second quarter of 2017 totaled $82.9 million, or $0.49 per common unit (diluted), with second-quarter 2017 Adjusted EBITDA(1) of $274.8 million and second-quarter 2017 Distributable cash flow(1) of $247.2 million.

WES previously declared a quarterly distribution of $0.890 per unit for the second quarter of 2017. This distribution represented a 2% increase over the prior quarter’s distribution and a 7% increase over the second-quarter 2016 distribution of $0.830 per unit. The second-quarter 2017 Coverage ratio(1) of 1.19 times was based on the quarterly distribution of $0.890 per unit.

"We continue to achieve significant milestones in the Delaware Basin that enhance both our competitive position in the area and our ability to serve the increasing needs of producers. These include the DBJV-for-Marcellus asset exchange, the early settlement of the DBJV Deferred Purchase Price Obligation, and the successful start-up of our produced water gathering and disposal systems," said Chief Executive Officer, Benjamin Fink. "Additionally, we are excited to announce the sanctioning of the Latham plant in the DJ Basin, which will consist of two cryogenic processing trains with a total capacity of 400 MMcf/d. These trains will be supported by long-term volumetric commitments from Anadarko, and are scheduled to come online in the first and third quarters of 2019."

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

Total throughput attributable to WES for natural gas assets for the second quarter of 2017 averaged 3.5 Bcf/d, which was 12% below the prior quarter and 10% below the second quarter of 2016. Total throughput attributable to WES for natural gas was 2% above the prior quarter when adjusted for the impact of the DBJV-for-Marcellus asset exchange that closed in March 2017. Total throughput for crude, NGL and produced water assets for the second quarter of 2017 averaged 182 MBbls/d, which was 8% above the prior quarter and 3% below the second quarter of 2016.

Capital expenditures attributable to WES, including equity investments but excluding acquisitions, totaled $133.6 million on a cash basis and $148.2 million on an accrual basis during the second quarter of 2017, with maintenance capital expenditures on a cash basis of $11.4 million.

WESTERN GAS EQUITY PARTNERS, LP WGP indirectly owns the entire general partner interest in WES, 100% of the incentive distribution rights in WES and 50,132,046 WES common units. Net income (loss) available to limited partners for the second quarter of 2017 totaled $104.9 million, or $0.48 per common unit (diluted).

WGP previously declared a quarterly distribution of $0.52750 per unit for the second quarter of 2017. This distribution represented a 7% increase over the prior quarter’s distribution and a 22% increase over the second-quarter 2016 distribution of $0.43375 per unit. WGP will receive distributions from WES of $116.3 million attributable to the second quarter and will pay $115.5 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, July 26, 2017, at 11:00 a.m. Central Daylight Time (12:00 p.m. Eastern Daylight Time) to discuss second-quarter 2017 results. Individuals who would like to participate should dial 877-883-0383 (Domestic) or 412-902-6506 (International) approximately 15 minutes before the scheduled conference call time, and enter participant access code 1783522. To access the live audio webcast of the conference call, please visit the investor relations section of the Partnership’s website at www.westerngas.com. A replay of the conference call will also be available on the website for two weeks following the call.

Western Gas Partners, LP ("WES") is a growth-oriented Delaware master limited partnership formed by Anadarko Petroleum Corporation to acquire, own, develop and operate midstream energy assets. With midstream assets located in the Rocky Mountains, North-central Pennsylvania and Texas, WES is engaged in the business of gathering, compressing, treating, processing and transporting natural gas; gathering, stabilizing and transporting condensate, natural gas liquids and crude oil; and gathering and disposing of produced water for Anadarko, as well as for 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 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. WES and WGP’s management believes 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 supply of, demand for, and price of oil, natural gas, NGLs and related products or services; 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 and Forms 10-Q 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 CONTACT Jonathon E. VandenBrand Director, Investor Relations jon.vandenbrand@anadarko.com 832.636.6000

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

Below are reconciliations of (i) net income (loss) attributable to Western Gas Partners, LP (GAAP) to WES’s Distributable cash flow (non-GAAP), (ii) net income (loss) attributable to Western Gas Partners, LP (GAAP) and net cash provided by operating activities (GAAP) to Adjusted EBITDA attributable to Western Gas Partners, LP ("Adjusted EBITDA") (non-GAAP), and (iii) operating income (loss) (GAAP) to Adjusted gross margin attributable to Western Gas Partners, LP ("Adjusted gross margin") (non-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 (loss) attributable to Western Gas Partners, LP and other applicable performance measures, such as operating income (loss) or cash flows from operating activities.

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

Distributable Cash Flow

WES defines Distributable cash flow as Adjusted EBITDA, plus interest income and the net settlement amounts from the sale and/or purchase of natural gas, condensate and NGLs under WES’s commodity price swap agreements to the extent such amounts are not recognized as Adjusted EBITDA, less net cash paid (or to be paid) for interest expense (including amortization of deferred debt issuance costs originally paid in cash, offset by non-cash capitalized interest), maintenance capital expenditures, Series A Preferred unit distributions and income taxes.

Three Months Ended
Six Months Ended
June 30,
June 30,
thousands except Coverage ratio
2017
2016
2017
2016
Reconciliation of Net income (loss) attributable to Western Gas Partners, LP to Distributable cash flow and calculation of the Coverage ratio
Net income (loss) attributable to Western Gas Partners, LP
$
173,451
$
164,521
$
275,340
$
280,581
Add:
Distributions from equity investments
28,856
24,491
51,423
49,130
Non-cash equity-based compensation expense
975
1,246
2,221
2,549
Non-cash settled - interest expense, net (1)
--
(15,461)
71
(10,924)
Income tax (benefit) expense
843
326
4,395
6,959
Depreciation and amortization (2)
73,352
66,650
142,401
131,089
Impairments
3,178
2,403
167,920
8,921
Above-market component of swap agreements with Anadarko
16,373
9,552
28,670
16,365
Other expense (2)
95
56
140
56
Less:
Gain (loss) on divestiture and other, net
15,458
(1,907)
134,945
(2,539)
Equity income, net - affiliates
21,728
19,693
41,189
36,507
Cash paid for maintenance capital expenditures (2)
11,402
21,085
22,524
39,982
Capitalized interest
1,060
1,482
1,876
3,331
Cash paid for (reimbursement of) income taxes
--
--
189
67
Series A Preferred unit distributions
--
14,082
7,453
15,969
Other income (2)
250
--
677
122
Distributable cash flow
$
247,225
$
199,349
$
463,728
$
391,287
Distributions declared (3)
Limited partners - common units
$
135,816
$
259,745
General partner
71,675
136,499
Total
$
207,491
$
396,244
Coverage ratio
1.19
x
1.17
x
(1) Includes amounts related to the Deferred purchase price obligation - Anadarko.
(2) Includes WES’s 75% share of depreciation and amortization; other expense; cash paid for maintenance capital expenditures; and other income attributable to Chipeta.
(3) Reflects cash distributions of $0.890 and $1.765 per unit declared for the three and six months ended June 30, 2017, respectively.

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 investments, non-cash equity-based compensation expense, interest expense, income tax expense, depreciation and amortization, impairments, and other expense (including lower of cost or market inventory adjustments recorded in cost of product), less gain (loss) on divestiture and other, net, income from equity investments, interest income, income tax benefit, and other income.

Three Months Ended
Six Months Ended
June 30,
June 30,
thousands
2017
2016
2017
2016
Reconciliation of Net income (loss) attributable to Western Gas Partners, LP to Adjusted EBITDA attributable to Western Gas Partners, LP
Net income (loss) attributable to Western Gas Partners, LP
$
173,451
$
164,521
$
275,340
$
280,581
Add:
Distributions from equity investments
28,856
24,491
51,423
49,130
Non-cash equity-based compensation expense
975
1,246
2,221
2,549
Interest expense
35,746
12,883
71,250
44,919
Income tax expense
843
326
4,395
6,959
Depreciation and amortization (1)
73,352
66,650
142,401
131,089
Impairments
3,178
2,403
167,920
8,921
Other expense (1)
95
56
140
56
Less:
Gain (loss) on divestiture and other, net
15,458
(1,907)
134,945
(2,539)
Equity income, net - affiliates
21,728
19,693
41,189
36,507
Interest income - affiliates
4,225
4,225
8,450
8,450
Other income (1)
250
--
677
122
Adjusted EBITDA attributable to Western Gas Partners, LP
$
274,835
$
250,565
$
529,829
$
481,664
Reconciliation of Net cash provided by operating activities to Adjusted EBITDA attributable to Western Gas Partners, LP
Net cash provided by (used in) operating activities
$
240,536
$
157,363
$
433,152
$
393,866
Interest (income) expense, net
31,521
8,658
62,800
36,469
Uncontributed cash-based compensation awards
(209)
86
(172)
158
Accretion and amortization of long-term obligations, net
(1,038)
14,522
(2,139)
9,055
Current income tax (benefit) expense
204
198
628
4,979
Other (income) expense, net
(253)
53
(683)
(71)
Distributions from equity investments in excess of cumulative earnings - affiliates
5,768
5,827
9,221
10,611
Changes in operating working capital:
Accounts receivable, net
(10,876)
45,800
(9,363)
33,242
Accounts and imbalance payables and accrued liabilities, net
12,035
20,205
41,975
2,227
Other
(131)
1,309
(116)
(1,739)
Adjusted EBITDA attributable to noncontrolling interest
(2,722)
(3,456)
(5,474)
(7,133)
Adjusted EBITDA attributable to Western Gas Partners, LP
$
274,835
$
250,565
$
529,829
$
481,664
Cash flow information of Western Gas Partners, LP
Net cash provided by (used in) operating activities
$
433,152
$
393,866
Net cash provided by (used in) investing activities
(363,131)
(952,824)
Net cash provided by (used in) financing activities
(239,749)
618,692
(1) Includes WES’s 75% share of depreciation and amortization; other expense; and other income attributable to Chipeta.

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 and other, less cost of product and reimbursements for electricity-related expenses recorded as revenue, plus distributions from equity investments and excluding the noncontrolling interest owner’s proportionate share of revenue and cost of product.

Three Months Ended
Six Months Ended
June 30,
June 30,
thousands
2017
2016
2017
2016
Reconciliation of Operating income (loss) to Adjusted gross margin attributable to Western Gas Partners, LP
Operating income (loss)
$
207,608
$
176,362
$
346,000
$
329,765
Add:
Distributions from equity investments
28,856
24,491
51,423
49,130
Operation and maintenance
76,148
75,173
149,908
151,386
General and administrative
10,585
10,883
23,244
22,160
Property and other taxes
11,924
12,078
24,218
22,428
Depreciation and amortization
74,031
67,305
143,733
132,400
Impairments
3,178
2,403
167,920
8,921
Less:
Gain (loss) on divestiture and other, net
15,458
(1,907)
134,945
(2,539)
Proceeds from business interruption insurance claims
24,115
2,603
29,882
2,603
Equity income, net - affiliates
21,728
19,693
41,189
36,507
Reimbursed electricity-related charges recorded as revenues
14,046
14,869
28,015
30,537
Adjusted gross margin attributable to noncontrolling interest
3,435
4,183
7,311
8,604
Adjusted gross margin attributable to Western Gas Partners, LP
$
333,548
$
329,254
$
665,104
$
640,478
Adjusted gross margin attributable to Western Gas Partners, LP for natural gas assets
$
297,778
$
294,661
$
599,283
$
571,190
Adjusted gross margin for crude, NGL and produced water assets
35,770
34,593
65,821
69,288
Western Gas Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
thousands except per-unit amounts
2017
2016
2017
2016
Revenues and other
Gathering, processing and transportation
$
299,435
$
301,136
$
607,249
$
595,140
Natural gas and natural gas liquids sales
224,824
126,993
431,349
215,549
Other
1,191
535
3,045
1,116
Total revenues and other
525,450
428,664
1,041,643
811,805
Equity income, net - affiliates
21,728
19,693
41,189
36,507
Operating expenses
Cost of product
203,277
104,849
392,636
181,316
Operation and maintenance
76,148
75,173
149,908
151,386
General and administrative
10,585
10,883
23,244
22,160
Property and other taxes
11,924
12,078
24,218
22,428
Depreciation and amortization
74,031
67,305
143,733
132,400
Impairments
3,178
2,403
167,920
8,921
Total operating expenses
379,143
272,691
901,659
518,611
Gain (loss) on divestiture and other, net
15,458
(1,907)
134,945
(2,539)
Proceeds from business interruption insurance claims
24,115
2,603
29,882
2,603
Operating income (loss)
207,608
176,362
346,000
329,765
Interest income - affiliates
4,225
4,225
8,450
8,450
Interest expense
(35,746)
(12,883)
(71,250)
(44,919)
Other income (expense), net
253
(53)
683
71
Income (loss) before income taxes
176,340
167,651
283,883
293,367
Income tax (benefit) expense
843
326
4,395
6,959
Net income (loss)
175,497
167,325
279,488
286,408
Net income attributable to noncontrolling interest
2,046
2,804
4,148
5,827
Net income (loss) attributable to Western Gas Partners, LP
$
173,451
$
164,521
$
275,340
$
280,581
Limited partners’ interest in net income (loss):
Net income (loss) attributable to Western Gas Partners, LP
$
173,451
$
164,521
$
275,340
$
280,581
Pre-acquisition net (income) loss allocated to Anadarko
--
--
--
(11,326)
Series A Preferred units interest in net (income) loss
(14,199)
(23,121)
(42,373)
(25,450)
General partner interest in net (income) loss
(76,365)
(58,381)
(144,527)
(113,781)
Common and Class C limited partners’ interest in net income (loss)
$
82,887
$
83,019
$
88,440
$
130,024
Net income (loss) per common unit - basic and diluted
$
0.49
$
0.55
$
0.53
$
0.86
Weighted-average common units outstanding - basic
148,864
130,669
141,696
129,830
Weighted-average common units outstanding - diluted
165,248
163,227
165,149
153,291
Western Gas Partners, LP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
thousands except number of units
June 30,
December 31,
2017
2016
Current assets
$
334,802
$
594,014
Note receivable - Anadarko
260,000
260,000
Net property, plant and equipment
5,347,794
5,049,932
Other assets
1,803,119
1,829,082
Total assets
$
7,745,715
$
7,733,028
Current liabilities
$
277,395
$
315,305
Long-term debt
3,253,065
3,091,461
Asset retirement obligations and other
152,695
149,043
Deferred purchase price obligation - Anadarko
--
41,440
Total liabilities
$
3,683,155
$
3,597,249
Equity and partners’ capital
Series A Preferred units (zero and 21,922,831 units issued and outstanding at June 30, 2017, and December 31, 2016, respectively)
$
--
$
639,545
Common units (152,602,105 and 130,671,970 units issued and outstanding at June 30, 2017, and December 31, 2016, respectively)
3,070,608
2,536,872
Class C units (21,743,318 and 12,358,123 units issued and outstanding at June 30, 2017, and December 31, 2016, respectively)
764,174
750,831
General partner units (2,583,068 units issued and outstanding at June 30, 2017, and December 31, 2016)
165,442
143,968
Noncontrolling interest
62,336
64,563
Total liabilities, equity and partners’ capital
$
7,745,715
$
7,733,028
Western Gas Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30,
thousands
2017
2016
Cash flows from operating activities
Net income (loss)
$
279,488
$
286,408
Adjustments to reconcile net income (loss) to net cash provided by operating activities and changes in working capital:
Depreciation and amortization
143,733
132,400
Impairments
167,920
8,921
(Gain) loss on divestiture and other, net
(134,945)
2,539
Change in other items, net
(23,044)
(36,402)
Net cash provided by (used in) operating activities
$
433,152
$
393,866
Cash flows from investing activities
Capital expenditures
$
(260,480)
$
(255,923)
Contributions in aid of construction costs from affiliates
1,343
3,854
Acquisitions from affiliates
(3,910)
(715,199)
Acquisitions from third parties
(155,287)
--
Investments in equity affiliates
(287)
139
Distributions from equity investments in excess of cumulative earnings - affiliates
9,221
10,611
Proceeds from the sale of assets to affiliates
--
613
Proceeds from the sale of assets to third parties
23,292
137
Proceeds from property insurance claims
22,977
2,944
Net cash provided by (used in) investing activities
$
(363,131)
$
(952,824)
Cash flows from financing activities
Borrowings, net of debt issuance costs
$
159,989
$
530,000
Repayments of debt
--
(290,000)
Settlement of the Deferred purchase price obligation - Anadarko
(37,346)
--
Increase (decrease) in outstanding checks
(2,763)
(1,314)
Proceeds from the issuance of common units, net of offering expenses
(183)
25,000
Proceeds from the issuance of Series A Preferred units, net of offering expenses
--
686,940
Distributions to unitholders
(381,771)
(313,380)
Distributions to noncontrolling interest owner
(6,375)
(7,460)
Net contributions from (distributions to) Anadarko
30
(27,459)
Above-market component of swap agreements with Anadarko
28,670
16,365
Net cash provided by (used in) financing activities
$
(239,749)
$
618,692
Net increase (decrease) in cash and cash equivalents
$
(169,728)
$
59,734
Cash and cash equivalents at beginning of period
357,925
98,033
Cash and cash equivalents at end of period
$
188,197
$
157,767
Western Gas Partners, LP
OPERATING STATISTICS
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
2017
2016
2017
2016
Throughput for natural gas assets (MMcf/d)
Gathering, treating and transportation
866
1,508
1,155
1,553
Processing
2,555
2,320
2,498
2,226
Equity investment (1)
158
170
160
178
Total throughput for natural gas assets
3,579
3,998
3,813
3,957
Throughput attributable to noncontrolling interest for natural gas assets
107
128
108
132
Total throughput attributable to Western Gas Partners, LP for natural gas assets
3,472
3,870
3,705
3,825
Throughput for crude, NGL and produced water assets (MBbls/d)
Gathering, treating and transportation
50
59
47
59
Equity investment (2)
132
128
129
127
Total throughput for crude, NGL and produced water assets
182
187
176
186
Adjusted gross margin per Mcf attributable to Western Gas Partners, LP for natural gas assets (3)
$
0.94
$
0.84
$
0.89
$
0.82
Adjusted gross margin per Bbl for crude, NGL and produced water assets (4)
2.15
2.03
2.07
2.05
(1) Represents WES’s 14.81% share of average Fort Union throughput and 22% share of average Rendezvous throughput.
(2) Represents WES’s 10% share of average White Cliffs throughput, WES’s 25% share of average Mont Belvieu JV throughput, WES’s 20% share of average TEG and TEP throughput, and WES’s 33.33% share of average FRP throughput.
(3) Average for period. Calculated as Adjusted gross margin attributable to Western Gas Partners, LP for natural gas assets (total revenues and other for natural gas assets, less reimbursements for electricity-related expenses recorded as revenue and cost of product for natural gas assets, plus distributions from WES’s equity investments in Fort Union and Rendezvous, and excluding the noncontrolling interest owner’s proportionate share of revenue and cost of product), divided by total throughput (MMcf/d) attributable to Western Gas Partners, LP for natural gas assets.
(4) Average for period. Calculated as Adjusted gross margin for crude, NGL and produced water assets (total revenues and other for crude, NGL and produced water assets, less reimbursements for electricity-related expenses recorded as revenue and cost of product for crude, NGL and produced water assets, plus distributions from WES’s equity investments in White Cliffs, the Mont Belvieu JV, TEG, TEP and FRP), divided by total throughput (MBbls/d) for crude, NGL and produced water assets.
Western Gas Equity Partners, LP
CALCULATION OF CASH AVAILABLE FOR DISTRIBUTION
(Unaudited)
thousands except per-unit amount and Coverage ratio
Three Months Ended
June 30, 2017
Distributions declared by Western Gas Partners, LP:
General partner interest
$
3,454
Incentive distribution rights
68,221
Common units held by WGP
44,618
Less:
Public company general and administrative expense
612
Interest expense
551
Cash available for distribution
$
115,130
Declared distribution per common unit
$
0.52750
Distributions declared by Western Gas Equity Partners, LP
$
115,487
Coverage ratio
1.00
x
Western Gas Equity Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
thousands except per-unit amounts
2017
2016
2017
2016
Revenues and other
Gathering, processing and transportation
$
299,435
$
301,136
$
607,249
$
595,140
Natural gas and natural gas liquids sales
224,824
126,993
431,349
215,549
Other
1,191
535
3,045
1,116
Total revenues and other
525,450
428,664
1,041,643
811,805
Equity income, net - affiliates
21,728
19,693
41,189
36,507
Operating expenses
Cost of product
203,277
104,849
392,636
181,316
Operation and maintenance
76,148
75,173
149,908
151,386
General and administrative
11,197
11,887
24,673
24,402
Property and other taxes
11,924
12,093
24,218
22,443
Depreciation and amortization
74,031
67,305
143,733
132,400
Impairments
3,178
2,403
167,920
8,921
Total operating expenses
379,755
273,710
903,088
520,868
Gain (loss) on divestiture and other, net
15,458
(1,907)
134,945
(2,539)
Proceeds from business interruption insurance claims
24,115
2,603
29,882
2,603
Operating income (loss)
206,996
175,343
344,571
327,508
Interest income - affiliates
4,225
4,225
8,450
8,450
Interest expense
(36,297)
(13,429)
(72,330)
(45,568)
Other income (expense), net
272
(36)
718
105
Income (loss) before income taxes
175,196
166,103
281,409
290,495
Income tax (benefit) expense
843
326
4,395
6,959
Net income (loss)
174,353
165,777
277,014
283,536
Net income (loss) attributable to noncontrolling interests
69,409
76,914
96,130
112,857
Net income (loss) attributable to Western Gas Equity Partners, LP
$
104,944
$
88,863
$
180,884
$
170,679
Limited partners’ interest in net income (loss):
Net income (loss) attributable to Western Gas Equity Partners, LP
$
104,944
$
88,863
$
180,884
$
170,679
Pre-acquisition net (income) loss allocated to Anadarko
--
--
--
(11,326)
Limited partners’ interest in net income (loss)
$
104,944
$
88,863
$
180,884
$
159,353
Net income (loss) per common unit - basic and diluted
$
0.48
$
0.41
$
0.83
$
0.73
Weighted-average common units outstanding - basic and diluted
218,931
218,921
218,930
218,920
Western Gas Equity Partners, LP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
thousands except number of units
June 30,
December 31,
2017
2016
Current assets
$
335,683
$
595,591
Note receivable - Anadarko
260,000
260,000
Net property, plant and equipment
5,347,794
5,049,932
Other assets
1,804,275
1,830,574
Total assets
$
7,747,752
$
7,736,097
Current liabilities
$
277,536
$
315,387
Long-term debt
3,281,065
3,119,461
Asset retirement obligations and other
152,695
149,043
Deferred purchase price obligation - Anadarko
--
41,440
Total liabilities
$
3,711,296
$
3,625,331
Equity and partners’ capital
Common units (218,933,141 and 218,928,570 units issued and outstanding at June 30, 2017, and December 31, 2016, respectively)
$
1,070,254
$
1,048,143
Noncontrolling interests
2,966,202
3,062,623
Total liabilities, equity and partners’ capital
$
7,747,752
$
7,736,097
Western Gas Equity Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30,
thousands
2017
2016
Cash flows from operating activities
Net income (loss)
$
277,014
$
283,536
Adjustments to reconcile net income (loss) to net cash provided by operating activities and changes in working capital:
Depreciation and amortization
143,733
132,400
Impairments
167,920
8,921
(Gain) loss on divestiture and other, net
(134,945)
2,539
Change in other items, net
(22,364)
(35,581)
Net cash provided by (used in) operating activities
$
431,358
$
391,815
Cash flows from investing activities
Capital expenditures
$
(260,480)
$
(255,923)
Contributions in aid of construction costs from affiliates
1,343
3,854
Acquisitions from affiliates
(3,910)
(715,199)
Acquisitions from third parties
(155,287)
--
Investments in equity affiliates
(287)
139
Distributions from equity investments in excess of cumulative earnings - affiliates
9,221
10,611
Proceeds from the sale of assets to affiliates
--
613
Proceeds from the sale of assets to third parties
23,292
137
Proceeds from property insurance claims
22,977
2,944
Net cash provided by (used in) investing activities
$
(363,131)
$
(952,824)
Cash flows from financing activities
Borrowings, net of debt issuance costs
$
159,989
$
556,017
Repayments of debt
--
(290,000)
Settlement of the Deferred purchase price obligation - Anadarko
(37,346)
--
Increase (decrease) in outstanding checks
(2,763)
(1,314)
Proceeds from the issuance of WES common units, net of offering expenses
(183)
--
Proceeds from the issuance of WES Series A Preferred units, net of offering expenses
--
686,940
Distributions to WGP unitholders
(208,803)
(181,156)
Distributions to Chipeta noncontrolling interest owner
(6,375)
(7,460)
Distributions to noncontrolling interest owners of WES
(171,689)
(130,947)
Net contributions from (distributions to) Anadarko
30
(27,459)
Above-market component of swap agreements with Anadarko
28,670
16,365
Net cash provided by (used in) financing activities
$
(238,470)
$
620,986
Net increase (decrease) in cash and cash equivalents
$
(170,243)
$
59,977
Cash and cash equivalents at beginning of period
359,072
99,694
Cash and cash equivalents at end of period
$
188,829
$
159,671

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SOURCE Western Gas Partners, LP; Western Gas Equity Partners, LP

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