Eagle Rock Energy Partners, L.P. ("Eagle Rock" or the
"Partnership") (Nasdaq:EROC) today announced its unaudited
financial results for the three months ended June 30, 2014.
On July 1, 2014, the Partnership successfully closed the
transaction between Eagle Rock and Regency Energy Partners LP
("Regency") (NYSE:RGP), in which Eagle Rock contributed its
midstream business to Regency (the "Midstream Business
Contribution").
The total consideration received by the Partnership for the
Midstream Business Contribution was $1.34 billion and consisted of
the following items:
(i) $576.2 million of cash;
(ii) 8,245,859 Regency common units
(valued at approximately $265 million based on the closing price of
Regency common units on June 30, 2014); and
(iii) the exchange of $498.9 million
face amount of newly-issued Regency 8.375% Senior Notes due 2019
for $498.9 million face amount of Eagle Rock's existing 8.375%
Senior Notes due 2019 (the "EROC Senior Notes").
$51.1 million of existing EROC Senior Notes did not exchange and
will remain outstanding; however, the Partnership has amended the
indenture pertaining to the EROC Senior Notes to eliminate
substantially all of the restrictive covenants and certain events
of default.
Cash proceeds from the Partnership's Midstream Business
Contribution were used to pay down borrowings under Eagle Rock's
revolving credit facility. As of July 1, 2014, the Partnership's
borrowings under the credit facility were $198.6 million, and the
Partnership's total debt balance was $249.7 million with its
leverage ratio estimated at approximately 2.0x. In addition, the
Partnership currently owns 8,245,859 Regency common units valued at
approximately $265 million as of June 30, 2014.
Second Quarter 2014 Financial Results
- Effective June 27, 2014 the Midstream Business was classified
as held-for-sale and discontinued operations. Except as otherwise
noted, the results shown below (including the first quarter 2014
results) reflect only results from continuing operations.
- Reported Adjusted EBITDA from continuing operations of $24.9
million, a slight decrease as compared to $26.1 million in the
first quarter of 2014.
- Reported Distributable Cash Flow from continuing operations of
$3.9 million as compared to the $4.6 million for the first quarter
of 2014.
- Reported a Net Loss of $43.0 million, driven in part by
unrealized commodity derivative losses recorded in the
quarter.
- Including amounts classified as discontinued operations,
Adjusted EBITDA was $50.7 million, which was $6.9 million lower
than first quarter results. This variance was largely due to the
higher than anticipated first quarter contribution from Natural Gas
Trading and Marketing, which was divested as part of the Midstream
Business Contribution.
The reported Adjusted EBITDA and Distributable Cash Flow
(whether discontinued operations or not) excludes the impact of
general and administrative expenses incurred in connection with the
Partnership's strategic review and Midstream Business Contribution,
which is consistent with the calculation of Consolidated EBITDA
under its senior secured credit facility.
Second Quarter 2014 Operating Results
The following second quarter 2014 operating results (and the
first quarter 2014 results) reflect the Partnership's results from
continuing operations.
- Drilled and completed three gross (1.95 net) operated wells and
participated in three gross (0.01 net) non-operated wells in the
Mid-Continent region in the second quarter of 2014. Additionally,
conducted seven gross (5.66 net) capital workovers and three gross
(3.00 net) recompletions in the second quarter of 2014.
- Total production was 6.48 Bcfe in the second quarter of 2014
compared to 6.50 Bcfe in the first quarter of 2014. Average daily
production was 71.2 MMcfe/d in the second quarter of 2014 compared
to 72.2 MMcfe/d in the first quarter of 2014.
- Oil production decreased to 300 MBbl compared to 317 MBbl in
the first quarter of 2014.
- NGL production increased to 290 MBbl compared to 274 MBbl in
the first quarter of 2014.
- Natural gas production decreased to 2.94 Bcf compared to 2.95
Bcf in the first quarter of 2014.
- The difference in production volumes was in part due to timing
of well completions, and third party pipeline curtailments in our
Permian and Mid-Continent operations.
- Operating expenses in the second quarter were $2.1 million
lower compared to the first quarter of 2014 due to lower lease and
plant operating cost, severance taxes, and general and
administrative expenses.
- The Partnership recorded $14.3 million of maintenance capital
expenditures in the second quarter of 2014, a decrease of $0.7
million as compared to the first quarter of 2014.
- Operating income in the second quarter of 2014 decreased by
approximately $9.0 million compared to the first quarter of
2014. The decrease was primarily due to unrealized losses on
commodity derivatives and lower production volumes in the Upstream
Business. Overall realized product pricing also negatively impacted
the quarter's results.
- Total revenue in the second quarter of 2014, excluding the
impact of Eagle Rock's realized and unrealized commodity derivative
gains and losses, was $52.1 million, down 6% compared with the
$55.2 million for the first quarter of 2014. The decline in
production volumes negatively impacted revenue by $0.7 million. Oil
and sulfur prices were higher while natural gas and liquid prices
were lower which negatively impacted results by $2.4
million.
- Recorded an unrealized loss on commodity derivatives of $15.9
million in the second quarter 2014, as compared to an unrealized
loss on commodity derivatives of $6.9 million in the first quarter
2014. Unrealized gain (loss) on commodity derivatives is a
non-cash, mark-to-market amount.
- The Partnership recorded a net loss of approximately $43.0
million for the second quarter of 2014, which was driven in part by
the unrealized commodity derivative loss and the $18.6 million loss
related to discontinued operations.
Second Quarter Distribution
On July 22, 2014, the Partnership announced it would not pay a
distribution for the second quarter of 2014. As previously
stated, management intends to recommend to the Board resuming a
quarterly distribution for the third quarter of 2014 (which, if
approved by the Board, would be payable in November 2014), subject
to the general business climate and the Partnership's specific
operations and assets (including assets that may be acquired in
potential acquisitions). In particular, and without limiting
the generality of the foregoing, management's distribution
recommendations are subject to the Partnership's results of
operations, projections and the prevailing commodity price
levels. All actual future distributions will be determined,
declared and paid at the sole discretion of the Board of
Directors.
Capitalization and Liquidity Update
As of June 30, 2014, prior to the Midstream Business
Contribution closing, total debt outstanding was approximately
$1.319 billion, which consisted of $550 million of senior unsecured
notes ($498.9 million classified as held-for-sale and $51.1 million
classified as continuing operations) and borrowings of $769 million
under the Partnership's senior secured credit facility. As of
June 30, 2014, the Partnership's borrowing base under its senior
secured credit facility totaled approximately $819 million, and
based on outstanding borrowings and letters of credit, the
Partnership had approximately $45.8 million of availability under
its senior secured credit facility. Following the close of the
Midstream Business Contribution, as of July 1, 2014, total debt
outstanding decreased to approximately $249.7 million, due to the
exchange of $498.9 million senior unsecured notes and the
Partnership's use of cash proceeds to pay down $576.2 million of
the senior secured credit facility. Pursuant to an amendment
to the senior secured credit facility in May of 2014, the
Partnership's borrowing base was reduced to $330 million, providing
the Partnership $131.4 million of available funds under the credit
facility.
As of June 30, 2014, the Partnership had 159.9 million common
units outstanding, including 2.5 million unvested restricted common
units issued under its Amended and Restated Long-Term Incentive
Plan.
Guidance
Eagle Rock expects its quarterly General & Administrative
expenses to decrease over the next six months to a run rate between
$8.2 and $8.7 million per quarter. During the second half of 2014,
the Partnership plans to spend approximately $57 million on capital
expenditures with $27 million to be categorized as maintenance
capital expenditures and $30 million to be categorized as growth
capital expenditures. Subject to results from the
Partnership's drilling program, the Partnership expects to average
between 73 and 78 MMcfe/d during the second half of 2014.
Hedging Update
The Partnership has not entered into any additional commodity
hedges since its last hedging update on February 26, 2014. The
latest presentation, which now excludes the midstream hedges that
were conveyed as part of the Midstream Business Contribution, can
be accessed by going to www.eaglerockenergy.com: select Investor
Relations, then select Presentations.
Second Quarter 2014 Earnings Release Date and Conference
Call Information
Eagle Rock will hold a conference call to discuss its second
quarter 2014 financial and operating results on Thursday, July 31,
2014 at 2:00 p.m. Eastern Time (1:00 p.m. Central Time). Interested
parties may listen to the earnings conference call live over the
Internet or via telephone. To listen live over the Internet,
participants are advised to log on to the Partnership's web site at
www.eaglerockenergy.com and select the "Events & Presentations"
sub-tab under the "Investor Relations" tab. To participate by
telephone, the call in number is 877-293-5457, conference ID
72892414. Participants are advised to dial into the call at
least 15 minutes prior to the call. An audio replay of the
conference call will also be available for thirty days by dialing
855-859-2056, conference ID 72892414. In addition, a replay of
the audio webcast will be available by accessing the Partnership's
web site after the call is concluded.
About the Partnership
Eagle Rock is a growth-oriented master limited partnership
engaged in (a) the exploitation, development, and production of oil
and natural gas properties and (b) ancillary gathering,
compressing, treating, processing and marketing services with
respect to its production of natural gas, natural gas liquids,
condensate and crude oil.
Contact:
Eagle Rock Energy Partners, L.P.
Bob Haines, 281-408-1303 Vice President and Interim Chief
Financial Officer
Chad Knips, 281-408-1203 Director, Corporate Finance and
Investor Relations
Use of Non-GAAP Financial Measures
This news release and the accompanying schedules include the
non-generally accepted accounting principles, or non-GAAP,
financial measures of Adjusted EBITDA and Distributable Cash Flow.
The accompanying non-GAAP financial measures schedules (after the
financial schedules) provide reconciliations of these non-GAAP
financial measures to their most directly comparable financial
measures calculated and presented in accordance with accounting
principles generally accepted in the United States, or GAAP.
Non-GAAP financial measures should not be considered alternatives
to GAAP measures such as net income (loss), operating income
(loss), cash flows from operating activities or any other GAAP
measure of liquidity or financial performance.
Eagle Rock defines Adjusted EBITDA as net income (loss) plus or
(minus) income tax provision (benefit); interest-net, including
realized interest rate risk management instruments and other
expense; depreciation, depletion and amortization expense;
impairment expense; other operating expense, non-recurring; other
non-cash operating and general and administrative expenses,
including non-cash compensation related to the Partnership's
equity-based compensation program; unrealized (gains) losses on
commodity and interest rate risk management related instruments;
(gains) losses on discontinued operations and other (income)
expense; excluding certain general and administrative expenses
incurred in connection with the Partnership's strategic review and
Midstream Business Contribution.
Eagle Rock uses Adjusted EBITDA as a measure of its core
profitability to assess the financial performance of its assets.
Adjusted EBITDA also is used as a supplemental financial measure by
external users of Eagle Rock's financial statements such as
investors, commercial banks and research analysts. For example, the
Partnership's lenders under its revolving credit facility use a
variant of its Adjusted EBITDA in a compliance covenant designed to
measure the viability of Eagle Rock and its ability to perform
under the terms of the revolving credit facility; Eagle Rock,
therefore, uses Adjusted EBITDA to measure its compliance with its
revolving credit facility. Eagle Rock believes that investors
benefit from having access to the same financial measures that its
management uses in evaluating performance. Adjusted EBITDA is
useful in determining Eagle Rock's ability to sustain or increase
distributions. By excluding unrealized derivative gains (losses), a
non-cash, mark-to-market benefit (charge) which represents the
change in fair market value of the Partnership's executed
derivative instruments and is independent of its assets'
performance or cash flow generating ability, Eagle Rock believes
Adjusted EBITDA reflects the Partnership's ability to generate cash
sufficient to pay interest costs, support its level of
indebtedness, make cash distributions to its unitholders and
finance its maintenance capital expenditures. Eagle Rock further
believes that Adjusted EBITDA also portrays the underlying
performance of its operating assets by isolating the performance of
its operating assets from the impact of an unrealized, non-cash
measure designed to portray the fluctuating inherent value of a
financial asset. Similarly, by excluding the impact of
non-recurring discontinued operations, Adjusted EBITDA provides
users of the Partnership's financial statements a picture of its
current assets' cash generation ability, independently from that of
assets which are no longer a part of its operations.
Eagle Rock's Adjusted EBITDA definition may not be comparable to
Adjusted EBITDA or similarly titled measures of other entities, as
other entities may not calculate Adjusted EBITDA in the same manner
as Eagle Rock. Eagle Rock has reconciled Adjusted EBITDA to the
GAAP financial measure of net income (loss) at the end of this
release.
Distributable Cash Flow is defined as Adjusted EBITDA minus: (i)
maintenance capital expenditures; (ii) cash interest expense; (iii)
cash income taxes; and (iv) the addition of losses or subtraction
of gains relating to other miscellaneous non-cash amounts affecting
net income (loss) for the period. Maintenance capital expenditures
represent capital expenditures made to replace partially or fully
depreciated assets; to meet regulatory requirements; to maintain
the existing operating capacity of the Partnership's gathering,
processing and treating assets or to maintain the Partnership's
natural gas, NGL, crude or sulfur production.
Distributable Cash Flow is a significant performance metric used
by senior management to compare cash flows generated by the
Partnership (excluding growth capital expenditures and prior to the
establishment of any retained cash reserves by the Board of
Directors) to the cash distributions expected to be paid to
unitholders. Using this metric, management can quickly compute the
coverage ratio of estimated cash flows to planned cash
distributions. This financial measure also is important to
investors as an indicator of whether the Partnership is generating
cash flow at a level that can sustain or support an increase in
quarterly distribution rates. Actual distributions are set by the
Board of Directors.
The GAAP measure most directly comparable to Distributable Cash
Flow is net income (loss). Eagle Rock's Distributable Cash Flow
definition may not be comparable to Distributable Cash Flow or
similarly titled measures of other entities, as other entities may
not calculate Distributable Cash Flow (and Adjusted EBITDA, on
which it builds) in the same manner as Eagle Rock. Eagle Rock has
reconciled Distributable Cash Flow to the GAAP financial measure of
net income/(loss) at the end of this release.
In certain portions of this press release, Eagle Rock (a)
withheld assets and liabilities held for sale and discontinued
operations associated with the Midstream Business Contribution from
reported first quarter Adjusted EBITDA and Distributable Cash Flow,
and (b) added back assets and liabilities held for sale and
discontinued operations to reported second quarter 2014 Adjusted
EBITDA and Distributable Cash Flow. Because Eagle Rock classified
its midstream business as assets and liabilities held for sale and
discontinued operations in the second quarter of 2014, adjusting
for the assets and liabilities held for sale and discontinued
operations when comparing Eagle Rock's Adjusted EBITDA or
Distributable Cash Flow from first quarter to second quarter better
portrays the underlying performance of its operating assets by
isolating the performance of its operating assets and liabilities
from the impact of the Midstream Business Contribution.
Forward-Looking Statements
This news release may include "forward-looking statements." All
statements, other than statements of historical facts, included in
this press release that address activities, events or developments
that the Partnership expects, believes or anticipates will or may
occur in the future are forward-looking statements and speak only
as of the date on which such statement is made. These statements
are based on certain assumptions made by the Partnership based on
its experience and perception of historical trends, current
conditions, expected future developments and other factors it
believes are appropriate under the circumstances. Such statements
are subject to a number of assumptions, risks and uncertainties,
many of which are beyond the control of the Partnership. These
include, but are not limited to, risks related to volatility of
commodity prices; market demand for crude oil, natural gas and
natural gas liquids; the effectiveness of the Partnership's hedging
activities; the availability of local, intrastate and interstate
transportation systems and other facilities to transport crude oil,
natural gas and natural gas liquids; competition in the oil and gas
industry; the Partnership's ability to obtain credit and access the
capital markets; general economic conditions; and the effects of
government regulations and policies. Should one or more of these
risks or uncertainties occur, or should underlying assumptions
prove incorrect, the Partnership's actual results and plans could
differ materially from those implied or expressed by any
forward-looking statements. The Partnership assumes no obligation
to update any forward-looking statement as of any future date. For
a detailed list of the Partnership's risk factors, please consult
the Partnership's Form 10-K, filed with the SEC for the year ended
December 31, 2013 and the Partnership's Forms 10-Q filed with the
SEC for subsequent quarters, including the Form 10-Q filed for the
quarter ended June 30, 2014, as well as any other public filings
and press releases.
|
Eagle Rock Energy
Partners, L.P. |
Consolidated Statement
of Operations |
($ in
thousands) |
(unaudited) |
|
|
|
|
|
|
|
Three Months
Ended |
Six Months
Ended |
Three Months Ended |
|
June
30, |
June
30, |
March 31, |
|
2014 |
2013 |
2014 |
2013 |
2014 |
REVENUE: |
|
|
|
|
|
Natural gas, natural gas liquids, oil,
condensate and sulfur sales |
$ 51,967 |
$ 49,252 |
$ 107,051 |
$ 96,057 |
$ 55,084 |
Unrealized commodity derivative gains
(losses) |
(15,905) |
13,480 |
(22,800) |
1,266 |
(6,895) |
Realized commodity derivative gains |
(2,176) |
3,858 |
(5,314) |
9,236 |
(3,138) |
Other revenue |
158 |
76 |
310 |
573 |
152 |
Total revenue |
34,044 |
66,666 |
79,247 |
107,132 |
45,203 |
|
|
|
|
|
|
COSTS AND EXPENSES: |
|
|
|
|
|
Operations and maintenance |
10,907 |
9,579 |
22,405 |
21,279 |
11,498 |
Taxes other than income |
3,596 |
3,583 |
7,387 |
5,999 |
3,791 |
General and administrative |
12,005 |
13,341 |
25,295 |
26,651 |
13,290 |
Impairment |
— |
1,839 |
— |
1,839 |
— |
Depreciation, depletion and amortization |
20,299 |
22,060 |
40,705 |
43,356 |
20,406 |
Total costs and expenses |
46,807 |
50,402 |
95,792 |
99,124 |
48,985 |
OPERATING (LOSS) INCOME |
(12,763) |
16,264 |
(16,545) |
8,008 |
(3,782) |
OTHER INCOME (EXPENSE): |
|
|
|
|
|
Interest expense, net |
(4,948) |
(4,499) |
(9,702) |
(9,564) |
(4,754) |
Realized interest rate derivative losses |
(1,717) |
(1,685) |
(3,425) |
(3,336) |
(1,708) |
Unrealized interest rate derivative
gains |
1,146 |
1,534 |
2,564 |
3,029 |
1,418 |
Other income (expense), net |
2 |
(27) |
3 |
(35) |
1 |
Total other expense |
(5,517) |
(4,677) |
(10,560) |
(9,906) |
(5,043) |
(LOSS) INCOME BEFORE INCOME TAXES |
(18,280) |
11,587 |
(27,105) |
(1,898) |
(8,825) |
INCOME TAX BENEFIT |
(885) |
(544) |
(1,750) |
(2,105) |
(865) |
(LOSS) INCOME FROM CONTINUING OPERATIONS |
(17,395) |
12,131 |
(25,355) |
207 |
(7,960) |
DISCONTINUED OPERATIONS, NET OF TAX |
(25,646) |
3,901 |
(36,249) |
(17,689) |
(10,603) |
NET (LOSS) INCOME |
$ (43,041) |
$ 16,032 |
$ (61,604) |
$ (17,482) |
$ (18,563) |
|
|
|
|
|
|
|
Eagle Rock Energy
Partners, L.P. |
Upstream Operations
Information |
(unaudited) |
|
|
|
|
|
|
|
Three Months
Ended |
Six Months
Ended |
Three Months
Ended |
|
June
30, |
June
30, |
March 31, |
|
2014 |
2013 |
2014 |
2013 |
2014 |
Upstream |
|
|
|
|
|
Production: |
|
|
|
|
|
Oil and condensate (Bbl) |
300,330 |
294,353 |
617,456 |
573,421 |
317,126 |
Gas (Mcf) |
2,943,718 |
3,181,264 |
5,895,866 |
6,310,316 |
2,952,149 |
NGLs (Bbl) |
289,639 |
278,158 |
563,312 |
568,024 |
273,673 |
Total Mcfe |
6,483,532 |
6,616,330 |
12,980,474 |
13,158,986 |
6,496,943 |
|
|
|
|
|
|
Sulfur (long ton) |
25,554 |
26,641 |
50,015 |
53,240 |
24,461 |
|
|
|
|
|
|
Realized prices, excluding derivatives: |
|
|
|
|
|
Oil and condensate (per Bbl) |
$88.21 |
$84.85 |
$86.85 |
$84.71 |
$85.56 |
Gas (Mcf) |
$4.38 |
$4.00 |
$4.66 |
$3.60 |
$4.95 |
NGLs (Bbl) |
$35.38 |
$30.90 |
$38.55 |
$33.22 |
$41.90 |
Sulfur (long ton) |
$91.09 |
$110.75 |
$84.22 |
$110.54 |
$77.05 |
|
|
|
|
|
|
Operating statistics: |
|
|
|
|
|
Operating costs per Mcfe (incl production
taxes) (1) |
$2.00 |
$1.83 |
$2.07 |
$1.89 |
$2.14 |
Operating costs per Mcfe (excl production
taxes) (1) |
$1.45 |
$1.28 |
$1.50 |
$1.44 |
$1.56 |
Operating (loss) income per Mcfe |
$2.81 |
$1.95 |
$2.96 |
$1.91 |
$3.11 |
|
|
|
|
|
|
Drilling program (gross wells): |
|
|
|
|
|
Development wells |
6 |
14 |
10 |
22 |
4 |
Completions |
6 |
14 |
10 |
21 |
4 |
Workovers |
7 |
11 |
12 |
18 |
5 |
Recompletions |
3 |
6 |
4 |
7 |
1 |
|
|
|
|
|
|
(1) Excludes post-production
costs of $1,512, $2,883, $1,083 and $2,394, respectively, for the
three and six months ended June 30, 2014 and $1,371 for the three
months ended March 31, 2014. |
|
|
Eagle Rock Energy
Partners, L.P. |
GAAP to Non-GAAP
Reconciliations |
($ in
thousands) |
(unaudited) |
|
|
|
|
|
|
|
Three Months
Ended |
Six Months
Ended |
Three Months
Ended |
|
June
30, |
June
30, |
March 31, |
|
2014 |
2013 |
2014 |
2013 |
2014 |
Net income (loss) to Adjusted EBITDA |
|
|
|
|
|
Net (loss) income, as reported |
$ (43,041) |
$ 16,032 |
$ (61,604) |
$ (17,482) |
$ (18,563) |
Depreciation, depletion and amortization |
20,299 |
22,060 |
40,705 |
43,356 |
20,406 |
Impairment |
-- |
1,839 |
-- |
1,839 |
-- |
Loss (gain) from risk management activities,
net |
18,652 |
(17,187) |
28,975 |
(3,029) |
10,323 |
Total derivative settlements |
(3,893) |
2,173 |
(8,739) |
(1,266) |
(4,846) |
Non-cash mark-to-market of Upstream product
imbalances |
(1) |
(5) |
(7) |
(5) |
(6) |
Restricted units non-cash amortization
expense |
1,459 |
2,694 |
4,042 |
4,705 |
2,583 |
Income tax benefit |
(885) |
(544) |
(1,750) |
(2,105) |
(865) |
Interest - net including realized risk
management instruments and other expense |
6,663 |
6,211 |
13,124 |
12,935 |
6,461 |
Discontinued operations |
25,646 |
(3,901) |
36,249 |
17,689 |
10,603 |
Adjusted EBITDA |
$ 24,899 |
$ 29,372 |
$ 50,995 |
$ 56,637 |
$ 26,096 |
|
|
|
|
|
|
Net income (loss) to Distributable Cash
Flow |
|
|
|
|
|
Net (loss) income, as reported |
$ (43,041) |
$ 16,032 |
$ (61,604) |
$ (17,482) |
$ (18,563) |
Depreciation, depletion and amortization
expense |
20,299 |
22,060 |
40,705 |
43,356 |
20,406 |
Impairment |
-- |
1,839 |
-- |
1,839 |
-- |
Loss (gain) from risk management activities,
net |
18,652 |
(17,187) |
28,975 |
(3,029) |
10,323 |
Total derivative settlements |
(3,893) |
2,173 |
(8,739) |
(1,266) |
(4,846) |
Capital expenditures-maintenance related |
(14,319) |
(9,331) |
(28,960) |
(18,040) |
(15,009) |
Non-cash mark-to-market of Upstream product
imbalances |
(1) |
(5) |
(7) |
(5) |
(6) |
Restricted units non-cash amortization
expense |
1,459 |
2,694 |
4,042 |
4,705 |
2,583 |
Income tax benefit |
(885) |
(544) |
(1,750) |
(2,105) |
(865) |
Discontinued operations |
25,646 |
(3,901) |
36,249 |
17,689 |
10,603 |
Distributable Cash Flow |
$ 3,917 |
$ 13,830 |
$ 8,911 |
$ 25,662 |
$ 4,626 |
|
|
Eagle Rock Energy
Partners, L.P. |
Net loss to Adjusted
EBITDA and Distributable Cash Flows Including the |
Impact of Amounts
Classified as Discontinued Operations |
($ in
thousands) |
(unaudited) |
|
|
|
|
Three Months Ended June 30,
2014 |
Three Months Ended March 31,
2014 |
|
|
|
Net loss to Adjusted EBITDA - Including
impact of amount classified as discontinued operations |
|
|
Net loss, as reported |
$ (43,041) |
$ (18,563) |
Depreciation, depletion and amortization |
40,036 |
40,508 |
Impairment |
-- |
2,097 |
Loss from risk management activities,
net |
30,327 |
16,221 |
Total commodity derivative settlements |
(5,675) |
(7,448) |
Non-cash mark-to-market of Upstream product
imbalances |
(1) |
(6) |
Restricted units non-cash amortization
expense |
2,280 |
3,332 |
Income tax benefit |
(829) |
(953) |
Interest and other expense |
20,841 |
19,701 |
Other (1) |
6,757 |
2,700 |
Adjusted EBITDA - Including impact of amounts
classified as discontinued operations |
$ 50,695 |
$ 57,589 |
|
|
|
1) Includes non-recurring
expenses incurred in connection with the potential contribution of
the Midstream Business to Regency |
|
|
|
|
|
|
|
Three Months Ended June 30,
2014 |
Three Months Ended March 31,
2014 |
|
|
|
Net loss to Distributable Cash Flow -
Including impact of amount classified as discontinued
operations |
|
|
Distributable Cash Flow, as reported |
$ (43,041) |
$ (18,563) |
Depreciation, depletion and amortization |
40,036 |
40,508 |
Impairment |
-- |
2,097 |
Loss from risk management activities,
net |
30,327 |
16,221 |
Total commodity derivative settlements |
(5,675) |
(7,448) |
Non-cash mark-to-market of Upstream product
imbalances |
(1) |
(6) |
Restricted units non-cash amortization
expense |
2,280 |
3,332 |
Income tax benefit |
(829) |
(953) |
Capital expenditures-maintenance related |
(20,036) |
(18,505) |
Other |
6,757 |
2,700 |
Distributable Cash Flow - Including impact of
amounts classified as discontinued operations |
$ 9,818 |
$ 19,383 |
|
|
|
1) Includes non-recurring
expenses incurred in connection with the potential contribution of
the Midstream Business to Regency |
|
|
|
|
Eagle Rock Energy
Partners, L.P. |
Adjusted EBITDA to
Adjusted EBITDA Reconciliations |
And |
Distributable Cash Flow
to Distributable Cash Flow Reconciliation |
($ in
thousands) |
(unaudited) |
|
|
|
|
Three Months Ended June 30,
2014 |
Three Months Ended March 31,
2014 |
|
|
|
Adjusted EBITDA to Adjusted EBITDA |
|
|
Adjusted EBITDA, as reported (1) |
$ 24,899 |
$ 26,096 |
Discontinued operations |
(25,646) |
(10,603) |
Depreciation, depletion and amortization |
19,737 |
20,102 |
Impairment |
-- |
2,097 |
Loss from risk management activities,
net |
11,675 |
5,899 |
Total commodity derivative settlements |
(1,782) |
(2,603) |
Restricted units non-cash amortization
expense |
821 |
749 |
Income tax benefit |
56 |
(88) |
Interest and other expense |
14,178 |
13,240 |
Other (2) |
6,757 |
2,700 |
Adjusted EBITDA - Including impact of amounts
classified as discontinued operations |
$ 50,695 |
$ 57,589 |
|
|
|
1) Adjusted EBITDA for the three
months ended March 31, 2014 has been retrospectively adjusted to
exclude amount classified as discontinued operations related
to the contribution of the Midstream Business. |
2) Includes non-recurring
expenses incurred in connection with the potential contribution of
the Midstream Business to Regency |
|
|
|
|
Three Months Ended June 30,
2014 |
Three Months Ended March 31,
2014 |
|
|
|
Distributable Cash Flow to Distributable
Cash Flow |
|
|
Distributable Cash Flow, as reported |
$ 3,917 |
$ 4,626 |
Discontinued operations |
(25,646) |
(10,603) |
Depreciation, depletion and amortization |
19,737 |
20,102 |
Impairment |
-- |
2,097 |
Loss from risk management activities,
net |
11,675 |
5,899 |
Total commodity derivative settlements |
(1,782) |
(2,603) |
Restricted units non-cash amortization
expense |
821 |
749 |
Income tax benefit |
56 |
(88) |
Capital expenditures-maintenance related |
(5,717) |
(3,496) |
Other (2) |
6,757 |
2,700 |
Distributable Cash Flow - Including impact of
amounts classified as discontinued operations |
$ 9,818 |
$ 19,383 |
|
|
|
1) Adjusted EBITDA for the three
months ended March 31, 2014 has been retrospectively adjusted to
exclude amount classified as discontinued operations related
to the contribution of the Midstream Business. |
2) Includes non-recurring
expenses incurred in connection with the potential contribution of
the Midstream Business to Regency |
|
|
|
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