General | Quarterly / Earnings Reports | First Quarter (1Q) Update | Financial Results | Capital Markets
CONE Midstream Details 'Better than Expected' 1Q
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CONE Midstream Partners LP reported financial and operational results for the three months ending March 31, 2015.
Highlights:
- Net income of $14.2 million
- Average daily throughput volumes of 549 billion Btu per day (BBtu/d)
- EBITDA(2) of $16.1 million
- Distributable cash flow (DCF)(2) of $14.1 million.
John T. Lewis, Chairman of the Board and Chief Executive Officer of CONE Midstream GP LLC, commented: "Financial and operational results for the first quarter were good and exceeded our expectations. I am pleased that, as a result, we are increasing and narrowing the range of our financial guidance for full year 2015 results. Our current expectation is that 2015 EBITDA attributable to CNNX will be in the range of $66 - $72 million and full year DCF will be in the range of $55 - $62 million. With our good first quarter results, the continued progress on volume and cost initiatives, and increasing clarity on our Sponsors' 2015 plan, we are increasingly bullish on this year's performance.
"Although the commodity price environment has changed since our IPO, we remain committed to multi-year distribution growth in the 15%-20% range. CNNX was designed for growth, and our development company structure provides the potential for acquisition and dropdown opportunities to supplement our organic growth. We anticipate that if our business results materialize in line with our current expectations, management would be prepared to recommend beginning to increase our quarterly cash distribution in the second half of this year."
Quarterly Distribution
As previously announced, the Board of Directors of the General Partner declared a quarterly cash distribution of $0.2125 per unit with respect to the first quarter of 2015. The distribution payment will made on May 15, 2015 to unitholders of record at the close of business on May 4, 2015.
Capital Investment and Resources
CONE Midstream's allocated first quarter 2015 share of investment in expansion projects was $21.6 million. Total expansion capital investment at the three development companies in which CONE Midstream holds controlling interests was $58.7 million, with individual development company totals as follows:
- Anchor Systems (Development Company 1): Expansion investments totaled $26.7 million and were primarily expended for continued gathering system extensions and compression capacity expansions at both McQuay and Majorsville fields.
- Growth Systems (Development Company 2): Expansion investments totaled $11.4 million and primarily were expended to complete the connection of two well pads in Barbour County (WV), and the connection of one well pad in Lewis County (WV).
- Additional Systems (Development Company 3): Expansion investments totaled $20.6 million for the continued construction of Shirley Station, purchase of materials associated with our Sherwood South gathering system that will support development of the Oxford area, and an extension to a new pad in Pennsboro field. Additional line clearing work was also completed in these areas as well as the Moundsville and Allegheny County Airport project areas.
CONE Midstream's respective share of maintenance capital expenditures for the three development companies for first quarter 2015 was $2.0 million. Maintenance capital expenditures in the aggregate for the development companies in which CONE Midstream holds controlling interests totaled $3.2 million.
As of March 31, 2015, CONE Midstream had outstanding borrowings of $7.5 million under its $250 million revolving credit facility.
2015 Guidance
Based on current expectations, management is providing the following updated guidance for 2015. Full year 2015 EBITDA attributable to the Partnership, previously projected to be in the range of $62 - $70 million, is now expected to be in the range of $66 - $72 million. Full year Distributable Cash Flow attributable to the Partnership, previously projected to be in the range of $50 - $60 million, is now expected to be in the range of $55 - $62 million. CONE Midstream's financial guidance is based on numerous assumptions about future events and conditions and, therefore, could vary materially from actual results. These estimates are meant to provide guidance only and are subject to revision for acquisitions or operating environment changes.