SOURCE: Western Gas

Western Gas

Western Gas

August 05, 2014 16:05 ET

Western Gas Announces Second-Quarter 2014 Results

Raises 2014 Total Capital Expenditures Guidance Range

HOUSTON, TX--(Marketwired - Aug 5, 2014) -  Western Gas Partners, LP (NYSE: WES) ("WES" or the "Partnership") and Western Gas Equity Partners, LP (NYSE: WGP) ("WGP") today announced second-quarter 2014 financial and operating results.

WESTERN GAS PARTNERS, LP

Net income available to limited partners for the second quarter of 2014 totaled $67.0 million, or $0.57 per common unit (diluted). For the second quarter of 2014, Adjusted EBITDA(1) was $167.3 million and Distributable cash flow(1) was $137.0 million, resulting in a Coverage ratio(1) of 1.30 times for the period.

Total throughput attributable to WES for natural gas assets for the second quarter of 2014 averaged 3.6 Bcf/d, which was 5% above the prior quarter and 13% above the second quarter of 2013. Total throughput for crude/NGL assets for the second quarter of 2014 averaged 115 MBbls/d, which was 46% above the prior quarter.

Capital expenditures attributable to WES on a cash basis, including equity investments but excluding acquisitions, totaled $199.3 million during the second quarter of 2014. Of this amount, maintenance capital expenditures were $11.7 million, or 7% of Adjusted EBITDA(1). Capital expenditures attributable to WES on an accrual basis, including equity investments but excluding acquisitions, totaled $205.2 million during the second quarter of 2014.

"Our portfolio's solid second-quarter performance was highlighted by the successful start-up of our Lancaster Plant in the DJ Basin complex, which is currently running at capacity," said Chief Executive Officer, Don Sinclair. "Given the continued high activity level in the DJ Basin, as well as additional capital needed to repurpose a portion of our Haley system to handle rich gas from Anadarko's West Texas drilling activity, we now believe our full-year 2014 total capital expenditures will be between $720 million and $770 million."

WES previously declared a quarterly distribution of $0.650 per unit for the second quarter of 2014, representing a 4% increase over the prior quarter's distribution and a 16% increase over the second-quarter 2013 distribution of $0.56 per unit. The distribution will be paid on August 13, 2014, to unitholders of record at the close of business on July 31, 2014. The second-quarter 2014 Coverage ratio(1) of 1.30 times is based on the quarterly distribution of $0.650 per unit.

WESTERN GAS EQUITY PARTNERS, LP

WGP indirectly owns the 2% general partner interest in WES, 100% of the incentive distribution rights in WES and 49,296,205 WES common units. Net income available to limited partners for the second quarter of 2014 totaled $55.3 million, or $0.25 per common unit (diluted).

WGP previously declared a quarterly distribution of $0.27125 per unit for the second quarter of 2014, representing a 9% increase over the prior quarter's distribution and a 37% increase over the second-quarter 2013 distribution of $0.19750. The distribution will be paid on August 22, 2014, to unitholders of record at the close of business on July 31, 2014. WGP will receive distributions from WES of $60.3 million attributable to the second quarter and will pay out $59.4 million in distributions for the same period.

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

CONFERENCE CALL TOMORROW AT 11 A.M. CDT

WES and WGP will host a joint conference call on Wednesday, August 6, 2014, at 11:00 a.m. Central Daylight Time (12:00 p.m. Eastern Daylight Time) to discuss second-quarter 2014 results. To participate via telephone, please dial 877.621.4819 and enter participant code 53708569. Please call in 10 minutes prior to the scheduled start time. To access the live audio webcast of the conference call and slide presentation, please visit www.westerngas.com. A replay of the call will also be available on the website for approximately two weeks following the conference call.

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

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

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

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

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

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

Distributable Cash Flow

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

         
         
    Three Months Ended
 June 30,
  Six Months Ended
 June 30,
thousands except Coverage ratio   2014   2013 (1)   2014     2013 (1)
Reconciliation of Net income attributable to Western Gas Partners, LP to Distributable cash flow and calculation of the Coverage ratio                  
Net income attributable to Western Gas Partners, LP   $ 95,032   $ 60,016   $ 182,467     $ 110,730
Add:                          
  Distributions from equity investees     24,328     6,026     36,641       11,032
  Non-cash equity-based compensation expense     1,056     824     2,153       1,701
  Income tax (benefit) expense     226     53     (2 )     4,219
  Depreciation, amortization and impairments (2)     43,103     35,857     83,078       67,681
Less:                          
  Equity income, net     13,008     3,456     22,259       7,424
  Cash paid for maintenance capital expenditures (2)     11,698     6,174     20,540       12,206
  Capitalized interest     2,007     3,260     5,447       6,441
  Cash paid for (reimbursement of) income taxes     --     --     (340 )     --
  Other income (2) (3)     79     103     157       380
Distributable cash flow   $ 136,953   $ 89,783   $ 256,274     $ 168,912
Distributions declared(4)                          
  Limited partners   $ 77,396         $ 151,103        
  General partner     28,259           53,301        
  Total   $ 105,655         $ 204,404        
Coverage ratio     1.30x           1.25x        
                           
(1) Financial information has been recast to include the financial position and results attributable to the 20% interest in each of Texas Express Pipeline LLC ("TEP") and Texas Express Gathering LLC ("TEG") and a 33.33% interest in Front Range Pipeline LLC ("FRP") acquired from Anadarko (collectively, the "TEFR Interests").
(2) Includes WES's 75% share of depreciation, amortization and impairments; cash paid for maintenance capital expenditures; and other income attributable to Chipeta.
(3) Excludes income of $0.1 million and $0.4 million for the three months ended June 30, 2014 and 2013, respectively, and $0.5 million and $0.8 million for the six months ended June 30, 2014 and 2013, respectively, related to a component of a gas processing agreement accounted for as a capital lease.
(4) Reflects distributions of $0.650 and $1.275 per unit declared for the three and six months ended June 30, 2014, 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 investees, non-cash equity-based compensation expense, interest expense, income tax expense, depreciation, amortization and impairments, and other expense, less income from equity investments, interest income, income tax benefit, and other income.

             
             
    Three Months Ended
 June 30,
    Six Months Ended
 June 30,
 
thousands   2014     2013 (1)     2014     2013 (1)  
Reconciliation of Net income attributable to Western Gas Partners, LP to Adjusted EBITDA attributable to Western Gas Partners, LP                                
Net income attributable to Western Gas Partners, LP   $ 95,032     $ 60,016     $ 182,467     $ 110,730  
Add:                                
  Distributions from equity investees     24,328       6,026       36,641       11,032  
  Non-cash equity-based compensation expense     1,057       824       2,154       1,701  
  Interest expense     20,864       12,654       34,825       24,465  
  Income tax expense     226       53       226       4,219  
  Depreciation, amortization and impairments (2)     43,103       35,857       83,078       67,681  
Less:                                
  Equity income, net     13,008       3,456       22,259       7,424  
  Interest income, net - affiliates     4,225       4,225       8,450       8,450  
  Other income (2) (3)     79       103       157       380  
  Income tax benefit     --       --       228       --  
Adjusted EBITDA attributable to Western Gas Partners, LP   $ 167,298     $ 107,646     $ 308,297     $ 203,574  
Reconciliation of Adjusted EBITDA attributable to Western Gas Partners, LP to Net cash provided by operating activities                                
Adjusted EBITDA attributable to Western Gas Partners, LP   $ 167,298     $ 107,646     $ 308,297     $ 203,574  
Adjusted EBITDA attributable to noncontrolling interest     4,090       2,499       8,416       5,345  
  Interest income (expense), net     (16,639 )     (8,429 )     (26,375 )     (16,015 )
  Non-cash equity-based compensation expense     (20 )     54       33       (19 )
  Debt-related amortization and other items, net     678       566       1,358       1,126  
  Current income tax (expense) benefit     (53 )     10,032       465       15,136  
  Other income (expense), net (3)     82       103       163       381  
  Distributions from equity investments in excess of cumulative earnings     (7,804 )     --       (9,848 )     --  
  Changes in operating working capital:                                
    Accounts receivable, net     (12,371 )     (48,468 )     (23,353 )     (26,807 )
    Accounts and natural gas imbalance payables and accrued liabilities, net     2,521       (20,951 )     794       336  
    Other     2,369       2,070       4,247       235  
Net cash provided by operating activities   $ 140,151     $ 45,122     $ 264,197     $ 183,292  
Cash flow information of Western Gas Partners, LP                                
Net cash provided by operating activities                   $ 264,197     $ 183,292  
Net cash used in investing activities                   $ (770,776 )   $ (1,182,682 )
Net cash provided by financing activities                   $ 516,480     $ 653,589  
                                 
(1) Financial information has been recast to include the financial position and results attributable to the TEFR Interests.
(2) Includes WES's 75% share of depreciation, amortization and impairments and other income attributable to Chipeta.
(3) Excludes income of $0.1 million and $0.4 million for the three months ended June 30, 2014 and 2013, respectively, and $0.5 million and $0.8 million for the six months ended June 30, 2014 and 2013, respectively, related to a component of a gas processing agreement accounted for as a capital lease.
   
   

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

Adjusted gross margin attributable to Western Gas Partners, LP

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

         
         
    Three Months Ended
 June 30,
  Six Months Ended
 June 30,
thousands   2014   2013 (1)   2014   2013 (1)
Reconciliation of Adjusted gross margin attributable to Western Gas Partners, LP to Operating income                        
  Adjusted gross margin attributable to Western Gas Partners, LP for natural gas assets   $ 209,745   $ 157,084   $ 393,682   $ 297,479
  Adjusted gross margin for crude/NGL assets     21,507     3,374     32,296     6,965
Adjusted gross margin attributable to Western Gas Partners, LP   $ 231,252   $ 160,458   $ 425,978   $ 304,444
Adjusted gross margin attributable to noncontrolling interest   $ 4,935   $ 3,510   $ 10,029   $ 7,213
Equity income, net     13,008     3,456     22,259     7,424
Less:                        
  Distributions from equity investees     24,328     6,026     36,641     11,032
  Operation and maintenance     50,875     41,669     91,407     78,408
  General and administrative     8,000     7,288     16,415     14,952
  Property and other taxes     7,113     6,086     14,154     11,871
  Depreciation, amortization and impairments     43,746     36,496     84,358     68,936
Operating income   $ 115,133   $ 69,859   $ 215,291   $ 133,882
                         
(1) Financial information has been recast to include the financial position and results attributable to the TEFR Interests.
   
   
   
Western Gas Partners, LP  
CONDENSED CONSOLIDATED STATEMENTS OF INCOME  
(Unaudited)  
   
    Three Months Ended
 June 30,
    Six Months Ended
 June 30,
 
thousands except per-unit amounts   2014     2013 (1)     2014     2013 (1)  
Revenues                                
Gathering, processing and transportation of natural gas and natural gas liquids   $ 161,250     $ 109,800     $ 302,699     $ 212,690  
Natural gas, natural gas liquids and condensate sales     166,654       139,561       303,092       261,290  
Other, net     2,040       2,041       3,610       3,188  
Total revenues     329,944       251,402       609,401       477,168  
Equity income, net     13,008       3,456       22,259       7,424  
Operating expenses                                
Cost of product     118,085       93,460       210,035       176,543  
Operation and maintenance     50,875       41,669       91,407       78,408  
General and administrative     8,000       7,288       16,415       14,952  
Property and other taxes     7,113       6,086       14,154       11,871  
Depreciation, amortization and impairments     43,746       36,496       84,358       68,936  
Total operating expenses     227,819       184,999       416,369       350,710  
Operating income     115,133       69,859       215,291       133,882  
Interest income, net - affiliates     4,225       4,225       8,450       8,450  
Interest expense     (20,864 )     (12,654 )     (34,825 )     (24,465 )
Other income     214       499       691       1,173  
Income before income taxes     98,708       61,929       189,607       119,040  
Income tax (benefit) expense     226       53       (2 )     4,219  
Net income     98,482       61,876       189,609       114,821  
Net income attributable to noncontrolling interest     3,450       1,860       7,142       4,091  
Net income attributable to Western Gas Partners, LP   $ 95,032     $ 60,016     $ 182,467     $ 110,730  
Limited partners' interest in net income:                                
Net income attributable to Western Gas Partners, LP   $ 95,032     $ 60,016     $ 182,467     $ 110,730  
Pre-acquisition net (income) loss allocated to Anadarko     --       948       956       (4,510 )
General partner interest in net (income) loss     (28,047 )     (16,154 )     (52,881 )     (29,040 )
Limited partners' interest in net income   $ 66,985     $ 44,810     $ 130,542     $ 77,180  
Net income per common unit - basic and diluted   $ 0.57     $ 0.41     $ 1.11     $ 0.72  
Weighted average common units outstanding - basic and diluted     118,177       108,736       117,948       106,784  
                                 
(1) Financial information has been recast to include the financial position and results attributable to the TEFR Interests.
   
 
 
Western Gas Partners, LP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
 
thousands except number of units   June 30,
 2014
  December 31,
2013
(1)
Current assets   $ 224,203   $ 194,810
Note receivable - Anadarko     260,000     260,000
Net property, plant and equipment     3,655,367     3,383,255
Other assets     825,242     779,743
Total assets   $ 4,964,812   $ 4,617,808
Current liabilities   $ 176,658   $ 190,460
Long-term debt     2,022,876     1,418,169
Asset retirement obligations and other     82,528     117,143
Total liabilities   $ 2,282,062   $ 1,725,772
Equity and partners' capital            
Common units (118,971,307 and 117,322,812 units issued and outstanding at June 30, 2014, and December 31, 2013, respectively)   $ 2,528,069   $ 2,431,193
General partner units (2,408,699 and 2,394,345 units issued and outstanding at June 30, 2014, and December 31, 2013, respectively)     84,894     78,157
Net investment by Anadarko     --     312,092
Noncontrolling interest     69,787     70,594
Total liabilities, equity and partners' capital   $ 4,964,812   $ 4,617,808
             
(1) Financial information has been recast to include the financial position and results attributable to the TEFR Interests.
   
   
   
Western Gas Partners, LP  
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS  
(Unaudited)  
   
    Six Months Ended
 June 30,
 
thousands   2014     2013 (1)  
Cash flows from operating activities                
Net income   $ 189,609     $ 114,821  
Adjustments to reconcile net income to net cash provided by operating activities and changes in working capital:                
  Depreciation, amortization and impairments     84,358       68,936  
  Change in other items, net     (9,770 )     (465 )
Net cash provided by operating activities   $ 264,197     $ 183,292  
Cash flows from investing activities                
Capital expenditures   $ (359,752 )   $ (339,756 )
Contributions in aid of construction costs from affiliates     182       --  
Acquisitions from affiliates     (360,952 )     (466,936 )
Acquisitions from third parties     --       (212,674 )
Investments in equity affiliates     (59,245 )     (156,217 )
Distributions from equity investments in excess of cumulative earnings     9,848       --  
Proceeds from the sale of assets to affiliates     --       82  
Proceeds from the sale of assets to third parties     --       14  
Capitalized interest on equity investments     (857 )     (7,195 )
Net cash used in investing activities   $ (770,776 )   $ (1,182,682 )
Cash flows from financing activities                
Borrowings, net of debt issuance costs   $ 1,076,895     $ 494,948  
Repayments of debt     (480,000 )     (245,000 )
Increase (decrease) in outstanding checks     2,517       (1,809 )
Proceeds from the issuance of common and general partner units, net of offering expenses     92,588       425,386  
Distributions to unitholders     (191,359 )     (135,801 )
Contributions from noncontrolling interest owner     --       1,097  
Distributions to noncontrolling interest owner     (7,949 )     (4,660 )
Net contributions from Anadarko     23,788       119,428  
Net cash provided by financing activities   $ 516,480     $ 653,589  
Net increase (decrease) in cash and cash equivalents   $ 9,901     $ (345,801 )
Cash and cash equivalents at beginning of period     100,728       419,981  
Cash and cash equivalents at end of period   $ 110,629     $ 74,180  
                 
(1) Financial information has been recast to include the financial position and results attributable to the TEFR Interests.
   
 
 
Western Gas Partners, LP
OPERATING STATISTICS
(Unaudited)
 
    Three Months Ended
 June 30,
  Six Months Ended
 June 30,
MMcf/d except throughput measured in barrels and per-unit amounts   2014   2013 (1)   2014   2013 (1)
                         
Throughput for natural gas assets                        
  Gathering, treating and transportation (2)     1,608     1,370     1,600     1,311
  Processing (2)     1,971     1,725     1,885     1,667
  Equity investment (3)     153     211     170     206
    Total throughput for natural gas assets     3,732     3,306     3,655     3,184
  Throughput attributable to noncontrolling interest for natural gas assets     171     167     172     161
  Total throughput attributable to Western Gas Partners, LP for natural gas assets (4)     3,561     3,139     3,483     3,023
  Total throughput (MBbls/d) for crude/NGL assets (5)     115     26     97     26
Adjusted gross margin per Mcf attributable to Western Gas Partners, LP for natural gas assets (6)   $ 0.65   $ 0.55   $ 0.62   $ 0.54
Adjusted gross margin per Bbl for crude/NGL assets (7)   $ 2.06   $ 1.43   $ 1.84   $ 1.45
                         
(1) Throughput has been recast to include throughput attributable to the TEFR Interests.
(2) The combination of WES's Wattenberg and Platte Valley systems in the first quarter of 2014 into the entity now referred to as the "DJ Basin complex" (also includes the Lancaster plant) resulted in the following: (i) the Wattenberg system volumes previously reported as "Gathering, treating and transportation" are now reported as "Processing" for all periods presented, and (ii) beginning with the first quarter of 2014, volumes both gathered and processed by the two systems are no longer separately reported.
(3) Represents WES's 14.81% share of average Fort Union and 22% share of average Rendezvous throughput. Excludes equity investment throughput measured in barrels (captured in "Total throughput (MBbls/d) for crude/NGL assets" as noted below).
(4) Includes affiliate, third-party and equity investment throughput (as equity investment throughput is defined in the above footnote), excluding the noncontrolling interest owner's proportionate share of throughput.
(5) Represents total throughput measured in barrels, consisting of throughput from our Chipeta NGL pipeline, our 10% share of average White Cliffs throughput, our 25% share of average Mont Belvieu JV throughput, our 20% share of average TEG and TEP throughput and our 33.33% share of average FRP throughput.
(6) Average for period. Calculated as Adjusted gross margin attributable to Western Gas Partners, LP for natural gas assets (total revenues for natural gas assets less cost of product for natural gas assets plus distributions from our equity investments in Fort Union and Rendezvous, which are measured in Mcf) divided by total throughput (MMcf/d) attributable to Western Gas Partners, LP for natural gas assets.
(7) Average for period. Calculated as Adjusted gross margin for crude/NGL assets (total revenues for crude/NGL assets less cost of product for crude/NGL assets plus distributions from our equity investments in White Cliffs, the Mont Belvieu JV, TEG, TEP and FRP, which are measured in barrels), divided by total throughput (MBbls/d) for crude/NGL assets.
   
 
 
Western Gas Equity Partners, LP
CALCULATION OF CASH AVAILABLE FOR DISTRIBUTION
(Unaudited)
 
    Three Months Ended
thousands except per-unit amount and Coverage ratio   June 30, 2014
Distributions declared by Western Gas Partners, LP:      
  General partner interest   $ 2,113
  Incentive distribution rights     26,146
  Common units held by WGP     32,043
Less:      
  Public company general and administrative expense     728
Cash available for distribution   $ 59,574
       
Declared distribution per common unit   $ 0.27125
       
Distributions declared by Western Gas Equity Partners, LP   $ 59,378
       
Coverage ratio     1.00x
       
   
   
Western Gas Equity Partners, LP  
CONDENSED CONSOLIDATED STATEMENTS OF INCOME  
(Unaudited)  
   
    Three Months Ended
 June 30,
    Six Months Ended
 June 30,
 
thousands except per-unit amounts   2014     2013 (1)     2014     2013 (1)  
Revenues                                
Gathering, processing and transportation of natural gas and natural gas liquids   $ 161,250     $ 109,800     $ 302,699     $ 212,690  
Natural gas, natural gas liquids and condensate sales     166,654       139,561       303,092       261,290  
Other, net     2,040       2,041       3,610       3,188  
Total revenues     329,944       251,402       609,401       477,168  
Equity income, net     13,008       3,456       22,259       7,424  
Operating expenses                                
Cost of product     118,085       93,460       210,035       176,543  
Operation and maintenance     50,875       41,669       91,407       78,408  
General and administrative     8,757       8,209       18,143       17,138  
Property and other taxes     7,113       6,086       14,154       11,871  
Depreciation, amortization and impairments     43,746       36,496       84,358       68,936  
Total operating expenses     228,576       185,920       418,097       352,896  
Operating income     114,376       68,938       213,563       131,696  
Interest income, net - affiliates     4,225       4,225       8,450       8,450  
Interest expense     (20,864 )     (12,654 )     (34,825 )     (24,465 )
Other income     235       493       731       1,220  
Income before income taxes     97,972       61,002       187,919       116,901  
Income tax (benefit) expense     226       53       (2 )     4,219  
Net income     97,746       60,949       187,921       112,682  
Net income attributable to noncontrolling interests     42,492       26,422       83,126       45,783  
Net income attributable to Western Gas Equity Partners, LP   $ 55,254     $ 34,527     $ 104,795     $ 66,899  
Limited partners' interest in net income:                                
Net income attributable to Western Gas Equity Partners, LP   $ 55,254     $ 34,527     $ 104,795     $ 66,899  
Pre-acquisition net (income) loss allocated to Anadarko     --       948       956       (4,510 )
Limited partners' interest in net income   $ 55,254     $ 35,475     $ 105,751     $ 62,389  
Net income per common unit - basic and diluted   $ 0.25     $ 0.16     $ 0.48     $ 0.29  
Weighted average number of common units outstanding - basic and diluted     218,903       218,896       218,903       218,896  
                                 
(1) Financial information has been recast to include the financial position and results attributable to the TEFR Interests.
   
 
 
Western Gas Equity Partners, LP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
 
thousands except number of units   June 30,
 2014
  December 31,
2013
(1)
Current assets   $ 235,865   $ 207,827
Note receivable - Anadarko     260,000     260,000
Net property, plant and equipment     3,655,367     3,383,255
Other assets     825,242     779,743
Total assets   $ 4,976,474   $ 4,630,825
Current liabilities   $ 176,735   $ 191,483
Long-term debt     2,022,876     1,418,169
Asset retirement obligations and other     82,528     117,143
Total liabilities   $ 2,282,139   $ 1,726,795
Equity and partners' capital            
Common units (218,903,498 and 218,895,515 units issued and outstanding at June 30, 2014, and December 31, 2013, respectively)   $ 941,814   $ 905,082
Net investment by Anadarko     --     312,092
Noncontrolling interests     1,752,521     1,686,856
Total liabilities, equity and partners' capital   $ 4,976,474   $ 4,630,825
             
(1) Financial information has been recast to include the financial position and results attributable to the TEFR Interests.
   
   
   
Western Gas Equity Partners, LP  
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS  
(Unaudited)  
   
    Six Months Ended
 June 30,
 
thousands   2014     2013 (1)  
Cash flows from operating activities                
Net income   $ 187,921     $ 112,682  
Adjustments to reconcile net income to net cash provided by operating activities and changes in working capital:                
  Depreciation, amortization and impairments     84,358       68,936  
  Change in other items, net     (10,146 )     (927 )
Net cash provided by operating activities   $ 262,133     $ 180,691  
Cash flows from investing activities                
Capital expenditures   $ (359,752 )   $ (339,756 )
Contributions in aid of construction costs from affiliates     182       --  
Acquisitions from affiliates     (360,952 )     (466,936 )
Acquisitions from third parties     --       (212,674 )
Investments in equity affiliates     (59,245 )     (156,217 )
Distributions from equity investments in excess of cumulative earnings     9,848       --  
Proceeds from the sale of assets to affiliates     --       82  
Proceeds from the sale of assets to third parties     --       14  
Capitalized interest on equity investments     (857 )     (7,195 )
Net cash used in investing activities   $ (770,776 )   $ (1,182,682 )
Cash flows from financing activities                
Borrowings, net of debt issuance costs   $ 1,076,895     $ 494,948  
Repayments of debt     (480,000 )     (245,000 )
Increase (decrease) in outstanding checks     2,517       (1,809 )
Offering expenses from the issuance of WGP common units     --       (2,367 )
Proceeds from the issuance of WES common units, net of offering expenses     91,690       416,119  
Distributions to WGP unitholders     (105,347 )     (46,980 )
Contributions received from Chipeta noncontrolling interest owner     --       1,097  
Distributions to Chipeta noncontrolling interest owner     (7,949 )     (4,660 )
Distributions to noncontrolling interest owners of WES     (83,894 )     (58,929 )
Net contributions from Anadarko     23,788       119,428  
Net cash provided by financing activities   $ 517,700     $ 671,847  
Net increase (decrease) in cash and cash equivalents   $ 9,057     $ (330,144 )
Cash and cash equivalents at beginning of period     113,085       422,556  
Cash and cash equivalents at end of period   $ 122,142     $ 92,412  
                 
(1) Financial information has been recast to include the financial position and results attributable to the TEFR Interests.
   
   

Contact Information

  • WESTERN GAS CONTACT
    Benjamin Fink, CFA
    SVP, Chief Financial Officer and Treasurer
    832.636.6010
    Email Contact