By a News Reporter-Staff News Editor at Energy Weekly News -- The EnLink Midstream companies, EnLink Midstream Partners, LP (NYSE:ENLK) (the Partnership) and EnLink Midstream, LLC (NYSE:ENLC) (the General Partner), reported results for the first quarter of 2014. EnLink Midstream was formed through the transaction (the Transaction) that combined substantially all of Devon Energy Corporation's (Devon) U.S. midstream assets with the assets of the former Crosstex Energy, Inc. and Crosstex Energy, L.P. (collectively, Crosstex), which closed on March 7, 2014. For accounting purposes, EnLink Midstream Holdings, LP (Midstream Holdings) is the acquirer in the Transaction because its parent company, Devon, obtained control of EnLink Midstream in the Transaction. As a result of this accounting treatment, the financial results reported herein include contributions from the legacy Devon midstream assets for the entire first quarter and contributions from the legacy Crosstex assets beginning on March 7, 2014. The financial results reported herein may not be comparable to financial results of prior periods or future periods due to, among other things, the following reasons: (i) Devon only contributed certain of its U.S. midstream assets in the Transaction; (ii) the first quarter financial results include contributions from the legacy Crosstex assets for the final 25 days of the first quarter; and (iii) Midstream Holdings entered into new agreements with Devon effective March 1, 2014 that are fee-based rather than the previous percent-of-proceeds contracts. First Quarter 2014 - EnLink Midstream Partners, LP Financial Results The Partnership realized adjusted EBITDA of $115.4 million and net income of $44.1 million for the first quarter of 2014. For the 25-day period following the closing of the Transaction, the Partnership generated $30.8 million of adjusted EBITDA, $24.5 million of distributable cash flow and $18.9 million of net income. Grossing up the 25-day period following the closing of the Transaction into a 90-day quarterly period implies that the distribution coverage ratio would have been approximately 0.93x on the Partnership's declared distribution of $0.36 per limited partner unit for the first quarter (assuming that Devon's Class B units had been common units outstanding for the full period). The implied coverage ratio is for illustrative purposes only and is not necessarily indicative of the result that would have been obtained had the Transaction occurred prior to the beginning of the first quarter. Adjusted EBITDA and distributable cash flow are explained in greater detail under "Non-GAAP Financial Information," and reconciliations of these measures to their most directly comparable GAAP measures are included in the tables at the end of this news release.
"We are pleased to report our first quarter results as EnLink Midstream," said Barry E. Davis, EnLink Midstream President and Chief Executive Officer. "Since the transaction's close in early March, we have made substantial progress in the integration of the two businesses. Our strong foundation of diverse assets, fee-based cash flows and unique sponsorship by Devon puts us in an excellent position for sustainable growth. We look forward to creating significant value for the equity holders, customers and employees of EnLink Midstream."
The Partnership's operating and reporting segments are based principally upon geographic regions served and consist of the following: the Texas segment, which includes natural gas gathering, processing, transmission and fractionation operations located in north Texas and west Texas; the Louisiana segment, which includes the pipelines, processing plants and NGL assets located in Louisiana; the Oklahoma segment, which includes natural gas gathering and processing operations located in Oklahoma; and the ORV segment which includes rail, truck, pipeline and barge facilities to deliver crude and condensate and brine disposal wells in the Ohio River Valley.
Keywords for this news article include: Energy, Oil & Gas, Natural Gas, EnLink Midstream.
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