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Western Gas Announces Second-Quarter 2018 Results

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Western Gas Announces Second-Quarter 2018 Results

PR Newswire

HOUSTON, July 31, 2018 /PRNewswire/ -- Western Gas Partners, LP (NYSE:WES) ("WES" or the "Partnership") and Western Gas Equity Partners, LP (NYSE:WGP) ("WGP") today announced second-quarter 2018 financial and operating results.

WESTERN GAS PARTNERS, LP

Net income (loss) available to limited partners for the second quarter of 2018 totaled $(51.5) million, or $(0.32) per common unit (diluted), with second-quarter 2018 Adjusted EBITDA(1) of $271.7 million and second-quarter 2018 Distributable cash flow(1) of $221.8 million. These results were impacted by the following amounts associated with the shutdown of two legacy gathering systems with less than 8 MMcf/d of throughput that had reached the end of their useful life: (i) an accrual of $10.9 million related to estimated future costs recorded as a reduction in affiliate product sales and (ii) $127.2 million recorded as impairment expense associated with reducing the net book value of the systems and additional asset retirement obligation. Adjusted EBITDA(1) includes the impact of the $10.9 million accrual.

WES previously declared a quarterly distribution of $0.950 per unit for the second quarter of 2018. This distribution represented a 2% increase over the prior quarter's distribution and a 7% increase over the second-quarter 2017 distribution. The second-quarter 2018 Coverage ratio(1) of 0.98 times was impacted by 0.05 times due to the aforementioned $10.9 million accrual.

(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.

"Since we initially provided our 2018 guidance last fall, we have been discussing our expectation of a volumetric and cash flow ramp in the second half of this year. I'm pleased to say that it has begun," said Chief Executive Officer, Benjamin Fink. "Anadarko has successfully brought two Regional Oil Treating facilities online, one late in the second quarter and one earlier this month, and the Delaware Basin generated strong volumetric growth in the second quarter, which should accelerate throughout the remainder of the year. Furthermore, we remain on track to bring both the Mentone I and II trains online late in the third and fourth quarters."

Total throughput attributable to WES for natural gas assets for the second quarter of 2018 averaged 3.8 Bcf/d, which was 5% above the prior quarter and 9% above the second quarter of 2017. Total throughput for crude oil, NGL and produced water assets for the second quarter of 2018 averaged 343 MBbls/d, which was 33% above the prior quarter and 88% above the second quarter of 2017. These increases were primarily driven by the continued growth behind our DBM water systems and our acquisition of a 20% interest in Whitethorn (which owns the Midland-to-Sealy pipeline and related storage facilities) in June.

Capital expenditures attributable to WES, including equity investments but excluding acquisitions, totaled $369.2 million on a cash basis and $322.0 million on an accrual basis during the second quarter of 2018, with maintenance capital expenditures on a cash basis of $20.9 million. The Partnership also announced the increase of its outlook for 2018 maintenance capital expenditures to a range of $90 million to $100 million from the previously stated range of $80 million to $90 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 2018 totaled $67.6 million, or $0.31 per common unit (diluted).

WGP previously declared a quarterly distribution of $0.58250 per unit for the second quarter of 2018. This distribution represented a 2% increase over the prior quarter's distribution and a 10% increase over the second-quarter 2017 distribution. WGP will receive distributions from WES of $128.3 million attributable to the second quarter of 2018 and will pay $127.5 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, August 1, 2018, at 11:00 a.m. Central Daylight Time (12:00 p.m. Eastern Daylight Time) to discuss second-quarter 2018 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 7387060. 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 assets. With midstream assets located in the Rocky Mountains, North-central Pennsylvania, Texas and New Mexico, 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 third-party producers and customers. In addition, in its capacity as a processor of natural gas, WES also buys and sells natural gas, NGLs and condensate on behalf of itself and as agent for its customers under certain of its contracts.

Western Gas Equity Partners, LP ("WGP") is a Delaware master limited partnership formed by Anadarko Petroleum Corporation 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, LP and Western Gas Equity Partners, LP 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 Service revenues – fee based recognized in Adjusted EBITDA (less than) in excess of customer billings, 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
 June 30,


Six Months Ended
 June 30,

thousands except Coverage ratio


2018


2017


2018


2017

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


$

32,708



$

173,451



$

182,071



$

275,340


Add:









Distributions from equity investments


31,947



28,856



60,901



51,423


Non-cash equity-based compensation expense


1,852



975



4,004



2,221


Non-cash settled interest expense, net (1)








71


Income tax (benefit) expense


282



843



1,784



4,395


Depreciation and amortization (2)


78,066



73,352



154,182



142,401


Impairments


127,243



3,178



127,391



167,920


Above-market component of swap agreements with Anadarko


13,839



16,373



28,121



28,670


Other expense (2)


8



95



151



140


Less:









Recognized Service revenues – fee based (less than) in excess of customer billings


(3,367)





(3,861)




Gain (loss) on divestiture and other, net


170



15,458



286



134,945


Equity income, net – affiliates


39,218



21,728



59,642



41,189


Cash paid for maintenance capital expenditures (2)


20,891



11,402



37,325



22,524


Capitalized interest


6,011



1,060



10,065



1,876


Cash paid for (reimbursement of) income taxes






(87)



189


Series A Preferred unit distributions








7,453


Other income (2)


1,223



250



2,000



677


Distributable cash flow


$

221,799



$

247,225



$

453,235



$

463,728


Distributions declared (3)









Limited partners – common units


$

144,979





$

287,662




General partner


80,712





159,162




Total


$

225,691





$

446,824




Coverage ratio


0.98


x



1.01

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 $0.950 and $1.885 per unit declared for the three and six months ended June 30, 2018, 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
 June 30,


Six Months Ended
 June 30,

thousands


2018


2017


2018


2017

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


$

32,708



$

173,451



$

182,071



$

275,340


Add:









Distributions from equity investments


31,947



28,856



60,901



51,423


Non-cash equity-based compensation expense


1,852



975



4,004



2,221


Interest expense


44,389



35,746



83,672



71,250


Income tax expense


282



843



1,784



4,395


Depreciation and amortization (1)


78,066



73,352



154,182



142,401


Impairments


127,243



3,178



127,391



167,920


Other expense (1)


8



95



151



140


Less:









Gain (loss) on divestiture and other, net


170



15,458



286



134,945


Equity income, net – affiliates


39,218



21,728



59,642



41,189


Interest income – affiliates


4,225



4,225



8,450



8,450


Other income (1)


1,223



250



2,000



677


Adjusted EBITDA attributable to Western Gas Partners, LP


$

271,659



$

274,835



$

543,778



$

529,829


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









Net cash provided by operating activities


$

273,315



$

240,536



$

514,911



$

433,152


Interest (income) expense, net


40,164



31,521



75,222



62,800


Uncontributed cash-based compensation awards


398



(209)



987



(172)


Accretion and amortization of long-term obligations, net


(1,248)



(1,038)



(2,626)



(2,139)


Current income tax (benefit) expense


90



204



261



628


Other (income) expense, net


(1,229)



(253)



(2,011)



(683)


Distributions from equity investments in excess of cumulative earnings – affiliates


4,492



5,768



12,505



9,221


Changes in assets and liabilities:









Accounts receivable, net


(21,639)



(10,876)



7,009



(9,363)


Accounts and imbalance payables and accrued liabilities, net


(13,498)



12,035



(40,573)



41,975


Other items, net


(5,655)



(131)



(14,670)



(116)


Adjusted EBITDA attributable to noncontrolling interest


(3,531)



(2,722)



(7,237)



(5,474)


Adjusted EBITDA attributable to Western Gas Partners, LP


$

271,659



$

274,835



$

543,778



$

529,829


Cash flow information of Western Gas Partners, LP









Net cash provided by operating activities






$

514,911



$

433,152


Net cash used in investing activities






(826,653)



(363,131)


Net cash provided by (used in) financing activities






286,163



(239,749)




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



Three Months Ended
 June 30,


Six Months Ended
 June 30,

thousands


2018


2017


2018


2017

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









Operating income (loss)


$

74,736



$

207,608



$

262,862



$

346,000


Add:









Distributions from equity investments


31,947



28,856



60,901



51,423


Operation and maintenance


100,628



76,148



188,907



149,908


General and administrative


14,035



10,585



28,167



23,244


Property and other taxes


11,754



11,924



24,136



24,218


Depreciation and amortization


78,792



74,031



155,634



143,733


Impairments


127,243



3,178



127,391



167,920


Less:









Gain (loss) on divestiture and other, net


170



15,458



286



134,945


Proceeds from business interruption insurance claims




24,115





29,882


Equity income, net – affiliates


39,218



21,728



59,642



41,189


Reimbursed electricity-related charges recorded as revenues


17,231



14,046



32,684



28,015


Adjusted gross margin attributable to noncontrolling interest


4,223



3,435



8,547



7,311


Adjusted gross margin attributable to Western Gas Partners, LP


$

378,293



$

333,548



$

746,839



$

665,104


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


$

329,653



$

297,778



$

655,525



$

599,283


Adjusted gross margin for crude oil, NGL and produced water assets


48,640



35,770



91,314



65,821


 

Western Gas Partners, LP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)




Three Months Ended
 June 30,


Six Months Ended
 June 30,

thousands except per-unit amounts


2018


2017


2018


2017

Revenues and other









Service revenues – fee based


$

359,544



$

299,435



$

697,963



$

607,249


Service revenues – product based


22,105





44,698




Product sales


54,077



224,824



130,014



431,349


Other


223



1,191



442



3,045


Total revenues and other


435,949



525,450



873,117



1,041,643


Equity income, net – affiliates


39,218



21,728



59,642



41,189


Operating expenses









Cost of product


68,149



203,277



145,948



392,636


Operation and maintenance


100,628



76,148



188,907



149,908


General and administrative


14,035



10,585



28,167



23,244


Property and other taxes


11,754



11,924



24,136



24,218


Depreciation and amortization


78,792



74,031



155,634



143,733


Impairments


127,243



3,178



127,391



167,920


Total operating expenses


400,601



379,143



670,183



901,659


Gain (loss) on divestiture and other, net


170



15,458



286



134,945


Proceeds from business interruption insurance claims




24,115





29,882


Operating income (loss)


74,736



207,608



262,862



346,000


Interest income – affiliates


4,225



4,225



8,450



8,450


Interest expense


(44,389)



(35,746)



(83,672)



(71,250)


Other income (expense), net


1,229



253



2,011



683


Income (loss) before income taxes


35,801



176,340



189,651



283,883


Income tax (benefit) expense


282



843



1,784



4,395


Net income (loss)


35,519



175,497



187,867



279,488


Net income attributable to noncontrolling interest


2,811



2,046



5,796



4,148


Net income (loss) attributable to Western Gas Partners, LP


$

32,708



$

173,451



$

182,071



$

275,340


Limited partners' interest in net income (loss):









Net income (loss) attributable to Western Gas Partners, LP


$

32,708



$

173,451



$

182,071



$

275,340


Series A Preferred units interest in net (income) loss




(14,199)





(42,373)


General partner interest in net (income) loss


(84,176)



(76,365)



(167,615)



(144,527)


Common and Class C limited partners' interest in net income (loss)


$

(51,468)



$

82,887



$

14,456



$

88,440


Net income (loss) per common unit – basic and diluted


$

(0.32)



$

0.49



$

0.06



$

0.53


Weighted-average common units outstanding – basic and diluted


152,604



148,864



152,603



141,696


 

Western Gas Partners, LP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


thousands except number of units


June 30,
 2018


December 31,
 2017

Current assets


$

247,138



$

254,062


Note receivable – Anadarko


260,000



260,000


Net property, plant and equipment


6,213,574



5,730,891


Other assets


1,945,898



1,769,397


Total assets


$

8,666,610



$

8,014,350


Current liabilities


$

489,117



$

424,333


Long-term debt


4,177,353



3,464,712


Asset retirement obligations


151,412



143,394


Other liabilities


147,246



10,900


Total liabilities


4,965,128



4,043,339


Equity and partners' capital





Common units (152,609,285 and 152,602,105 units issued and outstanding at June 30, 2018, and December 31, 2017, respectively)


2,666,799



2,950,010


Class C units (13,778,265 and 13,243,883 units issued and outstanding at June 30, 2018, and December 31, 2017, respectively)


781,057



780,040


General partner units (2,583,068 units issued and outstanding at June 30, 2018, and December 31, 2017)


191,564



179,232


Noncontrolling interest


62,062



61,729


Total liabilities, equity and partners' capital


$

8,666,610



$

8,014,350


 

Western Gas Partners, LP

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)



Six Months Ended
 June 30,

thousands


2018


2017

Cash flows from operating activities





Net income (loss)


$

187,867



$

279,488


Adjustments to reconcile net income (loss) to net cash provided by operating activities and changes in assets and liabilities:





Depreciation and amortization


155,634



143,733


Impairments


127,391



167,920


(Gain) loss on divestiture and other, net


(286)



(134,945)


Change in other items, net


44,305



(23,044)


Net cash provided by operating activities


$

514,911



$

433,152


Cash flows from investing activities





Capital expenditures


$

(650,096)



$

(260,480)


Contributions in aid of construction costs from affiliates




1,343


Acquisitions from affiliates




(3,910)


Acquisitions from third parties


(161,858)



(155,287)


Investments in equity affiliates


(27,490)



(287)


Distributions from equity investments in excess of cumulative earnings – affiliates


12,505



9,221


Proceeds from the sale of assets to third parties


286



23,292


Proceeds from property insurance claims




22,977


Net cash used in investing activities


$

(826,653)



$

(363,131)


Cash flows from financing activities





Borrowings, net of debt issuance costs


$

1,337,539



$

159,989


Repayments of debt


(630,000)




Settlement of the Deferred purchase price obligation – Anadarko




(37,346)


Increase (decrease) in outstanding checks


(5,357)



(2,763)


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




(183)


Distributions to unitholders


(437,719)



(381,771)


Distributions to noncontrolling interest owner


(6,421)



(6,375)


Net contributions from (distributions to) Anadarko




30


Above-market component of swap agreements with Anadarko


28,121



28,670


Net cash provided by (used in) financing activities


$

286,163



$

(239,749)


Net increase (decrease) in cash and cash equivalents


$

(25,579)



$

(169,728)


Cash and cash equivalents at beginning of period


78,814



357,925


Cash and cash equivalents at end of period


$

53,235



$

188,197


 

Western Gas Partners, LP

OPERATING STATISTICS

(Unaudited)




Three Months Ended
 June 30,


Six Months Ended
 June 30,



2018


2017


2018


2017

Throughput for natural gas assets (MMcf/d)









Gathering, treating and transportation


887



866



852



1,155


Processing


2,860



2,555



2,808



2,498


Equity investment (1)


141



158



146



160


 Total throughput for natural gas assets


3,888



3,579



3,806



3,813


 Throughput attributable to noncontrolling interest for natural gas assets


94



107



95



108


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


3,794



3,472



3,711



3,705


Throughput for crude oil, NGL and produced water assets (MBbls/d)









 Gathering, treating, transportation and disposal


145



50



134



47


 Equity investment (2)


198



132



167



129


Total throughput for crude oil, NGL and produced water assets


343


182


301


176

Adjusted gross margin per Mcf attributable to Western Gas Partners, LP for natural gas assets (3)


$

0.95



$

0.94



$

0.98



$

0.89


Adjusted gross margin per Bbl for crude oil, NGL and produced water assets (4)


1.56



2.15



1.68



2.07



















(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, WES's 33.33% share of average FRP throughput and WES's 20% share of average Whitethorn 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, less 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 oil, NGL and produced water assets (total revenues and other for crude oil, NGL and produced water assets less reimbursements for electricity-related expenses recorded as revenue, less cost of product for crude oil, NGL and produced water assets, and plus distributions from WES's equity investments in White Cliffs, the Mont Belvieu JV, TEG, TEP, FRP and Whitethorn), divided by total throughput (MBbls/d) for crude oil, 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, 2018

Distributions declared by Western Gas Partners, LP:



General partner interest


$

3,756


Incentive distribution rights


76,956


Common units held by WGP


47,625


Less:



Public company general and administrative expense


696


Interest expense


309


Cash available for distribution


$

127,332


Declared distribution per common unit


$

0.58250


Distributions declared by Western Gas Equity Partners, LP


$

127,531


Coverage ratio


1.00

x

 

Western Gas Equity Partners, LP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)




Three Months Ended
 June 30,


Six Months Ended
 June 30,

thousands except per-unit amounts


2018


2017


2018


2017

Revenues and other









Service revenues – fee based


$

359,544



$

299,435



$

697,963



$

607,249


Service revenues – product based


22,105





44,698




Product sales


54,077



224,824



130,014



431,349


Other


223



1,191



442



3,045


Total revenues and other


435,949



525,450



873,117



1,041,643


Equity income, net – affiliates


39,218



21,728



59,642



41,189


Operating expenses









Cost of product


68,149



203,277



145,948



392,636


Operation and maintenance


100,628



76,148



188,907



149,908


General and administrative


14,731



11,197



29,695



24,673


Property and other taxes


11,754



11,924



24,136



24,218


Depreciation and amortization


78,792



74,031



155,634



143,733


Impairments


127,243



3,178



127,391



167,920


Total operating expenses


401,297



379,755



671,711



903,088


Gain (loss) on divestiture and other, net


170



15,458



286



134,945


Proceeds from business interruption insurance claims




24,115





29,882


Operating income (loss)


74,040



206,996



261,334



344,571


Interest income – affiliates


4,225



4,225



8,450



8,450


Interest expense


(44,697)



(36,297)



(85,043)



(72,330)


Other income (expense), net


1,277



272



2,094



718


Income (loss) before income taxes


34,845



175,196



186,835



281,409


Income tax (benefit) expense


282



843



1,784



4,395


Net income (loss)


34,563



174,353



185,051



277,014


Net income (loss) attributable to noncontrolling interests


(33,017)



69,409



16,466



96,130


Net income (loss) attributable to Western Gas Equity Partners, LP


$

67,580



$

104,944



$

168,585



$

180,884


Net income (loss) per common unit – basic and diluted


$

0.31



$

0.48



$

0.77



$

0.83


Weighted-average common units outstanding – basic and diluted


218,934



218,931



218,934



218,930


 

Western Gas Equity Partners, LP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


thousands except number of units


June 30,
 2018


December 31,
 2017

Current assets


$

249,357



$

255,210


Note receivable – Anadarko


260,000



260,000


Net property, plant and equipment


6,213,574



5,730,891


Other assets


1,945,898



1,770,210


Total assets


$

8,668,829



$

8,016,311


Current liabilities


$

517,163



$

424,426


Long-term debt


4,177,353



3,492,712


Asset retirement obligations


151,412



143,394


Other liabilities


147,246



10,900


Total liabilities


4,993,174



4,071,432


Equity and partners' capital





Common units (218,937,797 and 218,933,141 units issued and outstanding at June 30, 2018, and December 31, 2017, respectively)


994,418



1,061,125


Noncontrolling interests


2,681,237



2,883,754


Total liabilities, equity and partners' capital


$

8,668,829



$

8,016,311


 

Western Gas Equity Partners, LP

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)




Six Months Ended
 June 30,

thousands


2018


2017

Cash flows from operating activities





Net income (loss)


$

185,051



$

277,014


Adjustments to reconcile net income (loss) to net cash provided by operating activities and changes in assets and liabilities:





Depreciation and amortization


155,634



143,733


Impairments


127,391



167,920


(Gain) loss on divestiture and other, net


(286)



(134,945)


Change in other items, net


45,457



(22,364)


Net cash provided by operating activities


$

513,247



$

431,358


Cash flows from investing activities





Capital expenditures


$

(650,096)



$

(260,480)


Contributions in aid of construction costs from affiliates




1,343


Acquisitions from affiliates




(3,910)


Acquisitions from third parties


(161,858)



(155,287)


Investments in equity affiliates


(27,490)



(287)


Distributions from equity investments in excess of cumulative earnings – affiliates


12,505



9,221


Proceeds from the sale of assets to third parties


286



23,292


Proceeds from property insurance claims




22,977


Net cash used in investing activities


$

(826,653)



$

(363,131)


Cash flows from financing activities





Borrowings, net of debt issuance costs


$

1,337,531



$

159,989


Repayments of debt


(630,000)




Settlement of the Deferred purchase price obligation – Anadarko




(37,346)


Increase (decrease) in outstanding checks


(5,357)



(2,763)


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




(183)


Distributions to WGP unitholders


(244,658)



(208,803)


Distributions to Chipeta noncontrolling interest owner


(6,421)



(6,375)


Distributions to noncontrolling interest owners of WES


(190,081)



(171,689)


Net contributions from (distributions to) Anadarko




30


Above-market component of swap agreements with Anadarko


28,121



28,670


Net cash provided by (used in) financing activities


$

289,135



$

(238,470)


Net increase (decrease) in cash and cash equivalents


$

(24,271)



$

(170,243)


Cash and cash equivalents at beginning of period


79,588



359,072


Cash and cash equivalents at end of period


$

55,317



$

188,829


 

Western Gas Partners (PRNewsFoto/Western Gas Partners, LP) (PRNewsFoto/Western Gas Partners, LP)

 

Western Gas Equity Partners (PRNewsFoto/Western Gas Partners, LP) (PRNewsFoto/Western Gas Partners, LP)

 

Cision View original content with multimedia:http://www.prnewswire.com/news-releases/western-gas-announces-second-quarter-2018-results-300689524.html

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

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