WGP
$36.26
Western Gas Eqty Partners LP
($.12)
(.33%)
Earnings Details
3rd Quarter September 2017
Tuesday, October 31, 2017 4:05:00 PM
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Summary

Western Gas Eqty Partners LP (WGP) Recent Earnings

Western Gas Eqty Partners LP (WGP) reported 3rd Quarter September 2017 earnings of $0.44 per share on revenue of $574.7 million. The consensus earnings estimate was $0.37 per share. Revenue grew 19.3% on a year-over-year basis.

Western Gas Equity Partners LP is engaged in gathering, processing, compressing, treating and transporting Anadarko and third-party natural gas, condensate, NGLs and crude oil in the U.S.

Results
Reported Earnings
$0.44
Earnings Whisper
-
Consensus Estimate
$0.37
Reported Revenue
$574.7 Mil
Revenue Estimate
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Western Gas Announces Third-Quarter 2017 Results

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

WESTERN GAS PARTNERS, LP

Net income (loss) available to limited partners for the third quarter of 2017 totaled $65.1 million, or $0.38 per common unit (diluted), with third-quarter 2017 Adjusted EBITDA(1) of $257.8 million and third-quarter 2017 Distributable cash flow(1) of $231.9 million.

WES previously declared a quarterly distribution of $0.905 per unit for the third quarter of 2017. This distribution represented a 2% increase over the prior quarter’s distribution and a 7% increase over the third-quarter 2016 distribution of $0.845 per unit. The third-quarter 2017 Coverage ratio(1) of 1.09 times was based on the quarterly distribution of $0.905 per unit.

"Our portfolio continues to display strong quarterly performance, driven by accelerated producer activity in the DJ and Delaware Basins, despite the over $3.0 million impact to Adjusted EBITDA associated with extreme weather events," said Chief Executive Officer, Benjamin Fink. "Our Ramsey processing facility is nearing capacity as we prepare to commission Ramsey VI later this quarter, and we remain confident that the growing production in the Delaware and DJ Basins will support the significant processing capacity we are adding at our new Mentone and Latham facilities, both of which are on schedule."

(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 third quarter of 2017 averaged 3.4 Bcf/d, which was 1% below the prior quarter (virtually flat when adjusted for the Helper and Clawson divestitures in June 2017) and 16% below the third quarter of 2016. Total throughput for crude, NGL and produced water assets for the third quarter of 2017 averaged 209 MBbls/d, which was 15% above the prior quarter and 13% above the third quarter of 2016.

Capital expenditures attributable to WES, including equity investments but excluding acquisitions, totaled $156.5 million on a cash basis and $222.3 million on an accrual basis during the third quarter of 2017, with maintenance capital expenditures on a cash basis of $10.6 million. WES is updating its 2017 outlook for capital expenditures to a range of $800 million to $850 million and maintenance capital expenditures to a range of $50 million to $55 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 third quarter of 2017 totaled $96.2 million, or $0.44 per common unit (diluted).

WGP previously declared a quarterly distribution of $0.53750 per unit for the third quarter of 2017. This distribution represented a 2% increase over the prior quarter’s distribution and a 20% increase over the third-quarter 2016 distribution of $0.44750 per unit. WGP will receive distributions from WES of $119.3 million attributable to the third quarter and will pay $117.7 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, November 1, 2017, at 11:00 a.m. Central Daylight Time (12:00 p.m. Eastern Daylight Time) to discuss third-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 4666075. 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
Nine Months Ended
September 30,
September 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
$
143,506
$
167,746
$
418,846
$
448,327
Add:
Distributions from equity investments
29,145
27,133
80,568
76,263
Non-cash equity-based compensation expense
1,258
1,469
3,479
4,018
Non-cash settled - interest expense, net (1)
--
(1,173)
71
(12,097)
Income tax (benefit) expense
510
472
4,905
7,431
Depreciation and amortization (2)
71,812
66,589
214,213
197,678
Impairments
2,159
2,392
170,079
11,313
Above-market component of swap agreements with Anadarko
18,049
18,417
46,719
34,782
Other expense (2)
--
40
140
96
Less:
Gain (loss) on divestiture and other, net
72
(6,230)
135,017
(8,769)
Equity income, net - affiliates
21,519
20,294
62,708
56,801
Cash paid for maintenance capital expenditures (2)
10,591
15,306
33,115
55,288
Capitalized interest
2,115
1,343
3,991
4,674
Cash paid for (reimbursement of) income taxes
--
--
189
67
Series A Preferred unit distributions
--
14,907
7,453
30,876
Other income (2)
283
150
960
272
Distributable cash flow
$
231,859
$
237,315
$
695,587
$
628,602
Distributions declared (3)
Limited partners - common units
$
138,105
$
397,850
General partner
73,933
210,432
Total
$
212,038
$
608,282
Coverage ratio
1.09
x
1.14
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 $0.905 and $2.670 per unit declared for the three and nine months ended September 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
Nine Months Ended
September 30,
September 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
$
143,506
$
167,746
$
418,846
$
448,327
Add:
Distributions from equity investments
29,145
27,133
80,568
76,263
Non-cash equity-based compensation expense
1,258
1,469
3,479
4,018
Interest expense
35,544
30,768
106,794
75,687
Income tax expense
510
472
4,905
7,431
Depreciation and amortization (1)
71,812
66,589
214,213
197,678
Impairments
2,159
2,392
170,079
11,313
Other expense (1)
--
40
140
96
Less:
Gain (loss) on divestiture and other, net
72
(6,230)
135,017
(8,769)
Equity income, net - affiliates
21,519
20,294
62,708
56,801
Interest income - affiliates
4,225
4,225
12,675
12,675
Other income (1)
283
150
960
272
Adjusted EBITDA attributable to Western Gas Partners, LP
$
257,835
$
278,170
$
787,664
$
759,834
Reconciliation of Net cash provided by operating activities to Adjusted EBITDA attributable to Western Gas Partners, LP
Net cash provided by operating activities
$
211,947
$
263,872
$
645,099
$
657,738
Interest (income) expense, net
31,319
26,543
94,119
63,012
Uncontributed cash-based compensation awards
78
290
(94)
448
Accretion and amortization of long-term obligations, net
(1,055)
121
(3,194)
9,176
Current income tax (benefit) expense
395
131
1,023
5,110
Other (income) expense, net
(286)
(153)
(969)
(224)
Distributions from equity investments in excess of cumulative earnings - affiliates
7,034
5,981
16,255
16,592
Changes in operating working capital:
Accounts receivable, net
56,335
7,866
46,972
41,108
Accounts and imbalance payables and accrued liabilities, net
(45,982)
(26,330)
(4,007)
(24,103)
Other
3,181
3,184
3,065
1,445
Adjusted EBITDA attributable to noncontrolling interest
(5,131)
(3,335)
(10,605)
(10,468)
Adjusted EBITDA attributable to Western Gas Partners, LP
$
257,835
$
278,170
$
787,664
$
759,834
Cash flow information of Western Gas Partners, LP
Net cash provided by operating activities
$
645,099
$
657,738
Net cash used in investing activities
(514,797)
(1,040,692)
Net cash provided by (used in) financing activities
(335,792)
429,368
(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
Nine Months Ended
September 30,
September 30,
thousands
2017
2016
2017
2016
Reconciliation of Operating income (loss) to Adjusted gross margin attributable to Western Gas Partners, LP
Operating income (loss)
$
179,456
$
197,288
$
525,456
$
527,053
Add:
Distributions from equity investments
29,145
27,133
80,568
76,263
Operation and maintenance
79,536
74,755
229,444
226,141
General and administrative
12,158
11,382
35,402
33,542
Property and other taxes
11,215
10,670
35,433
33,098
Depreciation and amortization
72,539
67,246
216,272
199,646
Impairments
2,159
2,392
170,079
11,313
Less:
Gain (loss) on divestiture and other, net
72
(6,230)
135,017
(8,769)
Proceeds from business interruption insurance claims
--
13,667
29,882
16,270
Equity income, net - affiliates
21,519
20,294
62,708
56,801
Reimbursed electricity-related charges recorded as revenues
14,323
15,170
42,338
45,707
Adjusted gross margin attributable to noncontrolling interest
5,878
3,984
13,189
12,588
Adjusted gross margin attributable to Western Gas Partners, LP
$
344,416
$
343,981
$
1,009,520
$
984,459
Adjusted gross margin attributable to Western Gas Partners, LP for natural gas assets
$
305,337
$
306,393
$
904,620
$
877,583
Adjusted gross margin for crude, NGL and produced water assets
39,079
37,588
104,900
106,876
Western Gas Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
thousands except per-unit amounts
2017
2016
2017
2016
Revenues and other
Gathering, processing and transportation
$
306,187
$
315,192
$
913,436
$
910,332
Natural gas and natural gas liquids sales
259,141
164,036
690,490
379,585
Other
9,367
2,417
12,412
3,533
Total revenues and other
574,695
481,645
1,616,338
1,293,450
Equity income, net - affiliates
21,519
20,294
62,708
56,801
Operating expenses
Cost of product
239,223
145,643
631,859
326,959
Operation and maintenance
79,536
74,755
229,444
226,141
General and administrative
12,158
11,382
35,402
33,542
Property and other taxes
11,215
10,670
35,433
33,098
Depreciation and amortization
72,539
67,246
216,272
199,646
Impairments
2,159
2,392
170,079
11,313
Total operating expenses
416,830
312,088
1,318,489
830,699
Gain (loss) on divestiture and other, net
72
(6,230)
135,017
(8,769)
Proceeds from business interruption insurance claims
--
13,667
29,882
16,270
Operating income (loss)
179,456
197,288
525,456
527,053
Interest income - affiliates
4,225
4,225
12,675
12,675
Interest expense
(35,544)
(30,768)
(106,794)
(75,687)
Other income (expense), net
286
153
969
224
Income (loss) before income taxes
148,423
170,898
432,306
464,265
Income tax (benefit) expense
510
472
4,905
7,431
Net income (loss)
147,913
170,426
427,401
456,834
Net income attributable to noncontrolling interest
4,407
2,680
8,555
8,507
Net income (loss) attributable to Western Gas Partners, LP
$
143,506
$
167,746
$
418,846
$
448,327
Limited partners’ interest in net income (loss):
Net income (loss) attributable to Western Gas Partners, LP
$
143,506
$
167,746
$
418,846
$
448,327
Pre-acquisition net (income) loss allocated to Anadarko
--
--
--
(11,326)
Series A Preferred units interest in net (income) loss
--
(25,539)
(42,373)
(50,989)
General partner interest in net (income) loss
(78,376)
(60,551)
(222,903)
(174,332)
Common and Class C limited partners’ interest in net income (loss)
$
65,130
$
81,656
$
153,570
$
211,680
Net income (loss) per common unit - basic and diluted
$
0.38
$
0.54
$
0.91
$
1.39
Weighted-average common units outstanding - basic
152,602
130,672
145,371
130,112
Weighted-average common units outstanding - diluted
165,475
164,658
165,258
157,107
Western Gas Partners, LP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
thousands except number of units
September 30,
December 31,
2017
2016
Current assets
$
358,346
$
594,014
Note receivable - Anadarko
260,000
260,000
Net property, plant and equipment
5,507,714
5,049,932
Other assets
1,788,251
1,829,082
Total assets
$
7,914,311
$
7,733,028
Current liabilities
$
393,364
$
315,305
Long-term debt
3,343,886
3,091,461
Asset retirement obligations and other
156,532
149,043
Deferred purchase price obligation - Anadarko
--
41,440
Total liabilities
$
3,893,782
$
3,597,249
Equity and partners’ capital
Series A Preferred units (zero and 21,922,831 units issued and outstanding at September 30, 2017, and December 31, 2016, respectively)
$
--
$
639,545
Common units (152,602,105 and 130,671,970 units issued and outstanding at September 30, 2017, and December 31, 2016, respectively)
3,012,424
2,536,872
Class C units (12,977,633 and 12,358,123 units issued and outstanding at September 30, 2017, and December 31, 2016, respectively)
771,856
750,831
General partner units (2,583,068 units issued and outstanding at September 30, 2017, and December 31, 2016)
172,180
143,968
Noncontrolling interest
64,069
64,563
Total liabilities, equity and partners’ capital
$
7,914,311
$
7,733,028
Western Gas Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
September 30,
thousands
2017
2016
Cash flows from operating activities
Net income (loss)
$
427,401
$
456,834
Adjustments to reconcile net income (loss) to net cash provided by operating activities and changes in working capital:
Depreciation and amortization
216,272
199,646
Impairments
170,079
11,313
(Gain) loss on divestiture and other, net
(135,017)
8,769
Change in other items, net
(33,636)
(18,824)
Net cash provided by operating activities
$
645,099
$
657,738
Cash flows from investing activities
Capital expenditures
$
(419,193)
$
(372,725)
Contributions in aid of construction costs from affiliates
1,386
4,927
Acquisitions from affiliates
(3,910)
(716,465)
Acquisitions from third parties
(155,298)
--
Investments in equity affiliates
(384)
139
Distributions from equity investments in excess of cumulative earnings - affiliates
16,255
16,592
Proceeds from the sale of assets to affiliates
--
623
Proceeds from the sale of assets to third parties
23,370
7,819
Proceeds from property insurance claims
22,977
18,398
Net cash used in investing activities
$
(514,797)
$
(1,040,692)
Cash flows from financing activities
Borrowings, net of debt issuance costs
$
249,989
$
1,094,600
Repayments of debt
--
(880,000)
Settlement of the Deferred purchase price obligation - Anadarko
(37,346)
--
Increase (decrease) in outstanding checks
3,310
(1,070)
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
--
686,937
Distributions to unitholders
(589,262)
(490,289)
Distributions to noncontrolling interest owner
(9,049)
(11,257)
Net contributions from (distributions to) Anadarko
30
(29,335)
Above-market component of swap agreements with Anadarko
46,719
34,782
Net cash provided by (used in) financing activities
$
(335,792)
$
429,368
Net increase (decrease) in cash and cash equivalents
$
(205,490)
$
46,414
Cash and cash equivalents at beginning of period
357,925
98,033
Cash and cash equivalents at end of period
$
152,435
$
144,447
Western Gas Partners, LP
OPERATING STATISTICS
(Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2017
2016
2017
2016
Throughput for natural gas assets (MMcf/d)
Gathering, treating and transportation
784
1,562
1,029
1,556
Processing
2,588
2,448
2,528
2,301
Equity investment (1)
159
179
160
178
Total throughput for natural gas assets
3,531
4,189
3,717
4,035
Throughput attributable to noncontrolling interest for natural gas assets
104
119
107
127
Total throughput attributable to Western Gas Partners, LP for natural gas assets
3,427
4,070
3,610
3,908
Throughput for crude, NGL and produced water assets (MBbls/d)
Gathering, treating and transportation
77
58
57
59
Equity investment (2)
132
127
130
126
Total throughput for crude, NGL and produced water assets
209
185
187
185
Adjusted gross margin per Mcf attributable to Western Gas Partners, LP for natural gas assets (3)
$
0.97
$
0.82
$
0.92
$
0.82
Adjusted gross margin per Bbl for crude, NGL and produced water assets (4)
2.03
2.20
2.05
2.10
(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
September 30, 2017
Distributions declared by Western Gas Partners, LP:
General partner interest
$
3,529
Incentive distribution rights
70,404
Common units held by WGP
45,370
Less:
Public company general and administrative expense
764
Interest expense
573
Cash available for distribution
$
117,966
Declared distribution per common unit
$
0.53750
Distributions declared by Western Gas Equity Partners, LP
$
117,677
Coverage ratio
1.00
x
Western Gas Equity Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
thousands except per-unit amounts
2017
2016
2017
2016
Revenues and other
Gathering, processing and transportation
$
306,187
$
315,192
$
913,436
$
910,332
Natural gas and natural gas liquids sales
259,141
164,036
690,490
379,585
Other
9,367
2,417
12,412
3,533
Total revenues and other
574,695
481,645
1,616,338
1,293,450
Equity income, net - affiliates
21,519
20,294
62,708
56,801
Operating expenses
Cost of product
239,223
145,643
631,859
326,959
Operation and maintenance
79,536
74,755
229,444
226,141
General and administrative
12,922
12,112
37,595
36,514
Property and other taxes
11,215
10,670
35,433
33,113
Depreciation and amortization
72,539
67,246
216,272
199,646
Impairments
2,159
2,392
170,079
11,313
Total operating expenses
417,594
312,818
1,320,682
833,686
Gain (loss) on divestiture and other, net
72
(6,230)
135,017
(8,769)
Proceeds from business interruption insurance claims
--
13,667
29,882
16,270
Operating income (loss)
178,692
196,558
523,263
524,066
Interest income - affiliates
4,225
4,225
12,675
12,675
Interest expense
(36,117)
(31,301)
(108,447)
(76,869)
Other income (expense), net
311
165
1,029
270
Income (loss) before income taxes
147,111
169,647
428,520
460,142
Income tax (benefit) expense
510
472
4,905
7,431
Net income (loss)
146,601
169,175
423,615
452,711
Net income (loss) attributable to noncontrolling interests
50,399
77,778
146,529
190,635
Net income (loss) attributable to Western Gas Equity Partners, LP
$
96,202
$
91,397
$
277,086
$
262,076
Limited partners’ interest in net income (loss):
Net income (loss) attributable to Western Gas Equity Partners, LP
$
96,202
$
91,397
$
277,086
$
262,076
Pre-acquisition net (income) loss allocated to Anadarko
--
--
--
(11,326)
Limited partners’ interest in net income (loss)
$
96,202
$
91,397
$
277,086
$
250,750
Net income (loss) per common unit - basic and diluted
$
0.44
$
0.42
$
1.27
$
1.15
Weighted-average common units outstanding - basic and diluted
218,933
218,922
218,931
218,921
Western Gas Equity Partners, LP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
thousands except number of units
September 30,
December 31,
2017
2016
Current assets
$
358,970
$
595,591
Note receivable - Anadarko
260,000
260,000
Net property, plant and equipment
5,507,714
5,049,932
Other assets
1,789,235
1,830,574
Total assets
$
7,915,919
$
7,736,097
Current liabilities
$
393,567
$
315,387
Long-term debt
3,371,886
3,119,461
Asset retirement obligations and other
156,532
149,043
Deferred purchase price obligation - Anadarko
--
41,440
Total liabilities
$
3,921,985
$
3,625,331
Equity and partners’ capital
Common units (218,933,141 and 218,928,570 units issued and outstanding at September 30, 2017, and December 31, 2016, respectively)
$
1,067,269
$
1,048,143
Noncontrolling interests
2,926,665
3,062,623
Total liabilities, equity and partners’ capital
$
7,915,919
$
7,736,097
Western Gas Equity Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
September 30,
thousands
2017
2016
Cash flows from operating activities
Net income (loss)
$
423,615
$
452,711
Adjustments to reconcile net income (loss) to net cash provided by operating activities and changes in working capital:
Depreciation and amortization
216,272
199,646
Impairments
170,079
11,313
(Gain) loss on divestiture and other, net
(135,017)
8,769
Change in other items, net
(32,480)
(17,739)
Net cash provided by operating activities
$
642,469
$
654,700
Cash flows from investing activities
Capital expenditures
$
(419,193)
$
(372,725)
Contributions in aid of construction costs from affiliates
1,386
4,927
Acquisitions from affiliates
(3,910)
(716,465)
Acquisitions from third parties
(155,298)
--
Investments in equity affiliates
(384)
139
Distributions from equity investments in excess of cumulative earnings - affiliates
16,255
16,592
Proceeds from the sale of assets to affiliates
--
623
Proceeds from the sale of assets to third parties
23,370
7,819
Proceeds from property insurance claims
22,977
18,398
Net cash used in investing activities
$
(514,797)
$
(1,040,692)
Cash flows from financing activities
Borrowings, net of debt issuance costs
$
249,989
$
1,120,580
Repayments of debt
--
(880,000)
Settlement of the Deferred purchase price obligation - Anadarko
(37,346)
--
Increase (decrease) in outstanding checks
3,310
(1,070)
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
--
686,937
Distributions to WGP unitholders
(324,290)
(276,114)
Distributions to Chipeta noncontrolling interest owner
(9,049)
(11,257)
Distributions to noncontrolling interest owners of WES
(262,888)
(211,877)
Net contributions from (distributions to) Anadarko
30
(29,335)
Above-market component of swap agreements with Anadarko
46,719
34,782
Net cash provided by (used in) financing activities
$
(333,708)
$
432,646
Net increase (decrease) in cash and cash equivalents
$
(206,036)
$
46,654
Cash and cash equivalents at beginning of period
359,072
99,694
Cash and cash equivalents at end of period
$
153,036
$
146,348

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

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