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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported):
August 6, 2024
ENLINK
MIDSTREAM, LLC
(Exact name of registrant as specified in its
charter)
| Delaware |
|
001-36336 |
|
46-4108528 |
(State
or Other Jurisdiction of
Incorporation or Organization) |
|
(Commission
File
Number) |
|
(I.R.S.
Employer Identification No.) |
1722
ROUTH STREET, SUITE
1300
DALLAS,
Texas |
|
75201 |
| (Address
of Principal Executive Offices) |
|
(Zip
Code) |
Registrant’s telephone number, including
area code: (214) 953-9500
(Former name or former address, if changed since
last report)
Check the appropriate box below if the Form 8-K
filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see
General Instruction A.2. below):
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
SECURITIES REGISTERED PURSUANT TO SECTION 12(b)
OF THE SECURITIES EXCHANGE ACT OF 1934:
| Title of Each Class |
|
Symbol |
|
Name of Exchange on which Registered |
Common
Units Representing Limited Liability Company Interests |
|
ENLC |
|
The
New York Stock Exchange |
Indicate by check mark whether the registrant is
an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2
of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company ¨
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
¨
| Item 2.02 |
Results of Operations and Financial Condition. |
On August
6, 2024, EnLink Midstream, LLC (the “Company”) issued a press release reporting its financial results for the second quarter
of 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and will be published on
the Company’s website at www.enlink.com. In accordance with General Instruction B.2 of Form 8-K, the information set forth
in this Item 2.02 and in such exhibit are deemed to be furnished and shall not be deemed to be “filed” for purposes of Section 18
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
| Item 7.01. |
Regulation FD Disclosure. |
On August
6, 2024, the Company published an investor presentation, which is available on the Company’s website, www.enlink.com, under “Investors
— News & Events — Presentations.” The Company may from time to time publish additional materials for investors
at the same website address. In accordance with General Instruction B.2 of Form 8-K, the information set forth in this Item 7.01
shall be deemed to be furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act.
| Item 9.01. |
Financial Statements and Exhibits. |
| |
|
| (d) |
Exhibits. |
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| |
ENLINK MIDSTREAM, LLC |
| |
|
| |
By: |
EnLink Midstream Manager, LLC,
its Managing Member |
| |
|
| Date: August 6, 2024 |
By: |
/s/ Benjamin D. Lamb |
| |
|
Benjamin D. Lamb |
| |
|
Executive Vice President and Chief Financial Officer |
Exhibit 99.1
FOR IMMEDIATE RELEASE -DRAFT
August 6, 2024
Investor Relations: Brian Brungardt, Senior Director of Investor
Relations, 214-721-9353, brian.brungardt@enlink.com
Media Relations: Megan Wright, Director of Corporate Communications,
214-721-9694, megan.wright@enlink.com
EnLink Midstream Reports Second Quarter 2024
Results
DALLAS, August 6, 2024
— EnLink Midstream, LLC (NYSE: ENLC) (EnLink) today reported financial results for the second quarter of 2024.
Highlights
| · | Reported net income of $67.0 million and net cash provided by operating activities of $162.6 million for the second quarter of 2024. |
| · | Generated adjusted EBITDA, net to EnLink, of $306.0 million for the second quarter of 2024. |
| · | Delivered $53.3 million of free cash flow after distributions (FCFAD) for the second quarter of 2024. |
| · | Subsequent to the quarter, EnLink reached final investment decision (FID) for EnLink's first brownfield natural gas expansion project
in Louisiana with plans to expand Jefferson Island Storage & Hub (JISH) by approximately 8 billion cubic feet (Bcf). The project
received strong commercial interest and is backed by investment-grade credit customers under long-term contracts. |
| · | Repurchased approximately $50.0 million1 of common units in the second quarter of 2024. EnLink has repurchased approximately
$100 million of common units through the first half of 2024. |
| · | Subsequent to the quarter, the Board of Directors increased the 2024 common unit repurchase authorization by $50 million to $250 million.
The increase reflected the generation of strong FCFAD, as well as the deferral of carbon capture and sequestration spending. |
| · | Subsequent to the quarter, EnLink purchased $200 million of Series B preferred units. Combined with common unit exchanges initiated
by the preferred unitholders, approximately $410 million of Series B preferred units now remain outstanding, reflecting a reduction
of nearly 50% since the beginning of 2024. |
“EnLink delivered a solid quarter in line with our expectations,
as our midstream assets and our diversified business continue to show resilience,” EnLink President and Chief Executive Officer
Jesse Arenivas said. “Our Louisiana team is executing on a multiprong growth strategy and moving projects toward commercialization,
such as the ‘Henry Hub to the River’ project announced last quarter and the JISH expansion announced today, to supply the
high-demand market for natural gas. EnLink's strength is in our diverse, integrated value chain, which we continue to leverage for new
opportunities that optimize and grow our business."
Adjusted EBITDA and FCFAD used in this press release are non-GAAP measures
and are explained in greater detail under "Non-GAAP Financial Information" below.
1Includes $22.9 million of common units repurchased from
GIP pursuant to our Unit Repurchase Agreement, which settled on August 5, 2024
Second Quarter 2024
Financial Results and Highlights
| $MM, unless noted | |
Second Quarter 2024 | | |
First Quarter 2024 | | |
Second Quarter 2023 | |
| Net Income (1) | |
| 67 | | |
| 50 | | |
| 90 | |
| Adjusted EBITDA, net to EnLink | |
| 306 | | |
| 338 | | |
| 334 | |
| Net Cash Provided by Operating Activities | |
| 163 | | |
| 293 | | |
| 316 | |
| Capex, Plant Relocation Costs, net to EnLink & Investment Contributions | |
| 103 | | |
| 111 | | |
| 88 | |
| Free Cash Flow After Distributions | |
| 53 | | |
| 74 | | |
| 96 | |
| Debt to Adjusted EBITDA, net to EnLink (2) | |
| 3.3 | x | |
| 3.3 | x | |
| 3.4 | x |
| Common Units Outstanding (3) | |
| 461,449,461 | | |
| 451,304,161 | | |
| 461,497,730 | |
(1) Net income is before non-controlling interest.
(2) Calculated according to credit facility leverage
covenant.
(3) Outstanding common units as of August 1, 2024,
April 25, 2024, and July 27, 2023, respectively.
Second Quarter 2024
Segment Updates
Permian Basin:
| · | Segment profit for the second quarter of 2024 was $93.1 million, including operating expenses related to plant relocation of $16.8
million and unrealized derivative losses of $1.3 million. Excluding plant relocation operating expenses and unrealized derivative activity,
segment profit in the second quarter of 2024 grew approximately 10% sequentially and grew approximately 10% over the second quarter of
2023. |
| · | Average natural gas gathering volumes for the second quarter of 2024 were approximately 7% higher compared to the first quarter of
2024 and approximately 17% higher compared to the second quarter of 2023. |
| · | Average natural gas processing volumes for the second quarter of 2024 were approximately 6% higher compared to the first quarter of
2024 and approximately 14% higher compared to the second quarter of 2023. EnLink continues to benefit from strong producer drilling and
completion activity. |
| · | Average crude gathering volumes for the second quarter of 2024 were approximately 16% higher compared to the first quarter of 2024
and approximately 23% higher compared to the second quarter of 2023. |
| · | EnLink's third plant relocation, Tiger II, came online in May. |
Louisiana:
| · | Segment profit for the second quarter of 2024 was $84.3 million, including unrealized derivative gains of $5.6 million. Excluding
unrealized derivative activity, segment profit in the second quarter of 2024 decreased approximately 39% sequentially, driven by normal
seasonal effects in the natural gas liquids (NGL) segment, and decreased 9% over the second quarter of 2023. |
| · | Average natural gas transportation volumes for the second quarter of 2024 were approximately 2% higher compared to the first quarter
of 2024 and approximately 20% higher compared to the second quarter of 2023. |
| · | NGL fractionation volumes for the second quarter of 2024 were approximately 5% lower compared to the first quarter of 2024 and 2%
lower compared to the second quarter of 2023. |
| · | EnLink reached FID on the Stage 1 brownfield expansion project at JISH, adding approximately 8 Bcf of working gas storage. Consistent
with EnLink's strategy to leverage existing assets, Stage 1 will cost approximately $85 million with project economics in the low-to-mid
single digit EBITDA multiples. The Stage 1 expansion is anticipated to begin service in 2028 and will increase working gas storage to
10 Bcf from 2 Bcf at JISH. |
Oklahoma:
| · | Segment profit for the second quarter of 2024 was $103.5 million, including operating expenses related to plant relocation of $0.1
million and unrealized derivative gains of $0.8 million. Excluding plant relocation operating expenses and unrealized derivative activity,
segment profit in the second quarter of 2024 grew 14% sequentially but decreased approximately 5% over the second quarter of 2023. |
| · | Average natural gas gathering volumes for the second quarter of 2024 were approximately 7% higher compared to the first quarter of
2024 but were approximately 3% lower compared to the second quarter of 2023. |
| · | Average natural gas processing volumes for the second quarter of 2024 were approximately 8% higher compared to the first quarter of
2024 but were approximately 3% lower compared to the second quarter of 2023. |
| · | Average crude gathering volumes during the second quarter of 2024 were approximately 13% lower compared to the first quarter of 2024
and approximately 34% lower compared to the second quarter of 2023. |
North Texas:
| · | Segment profit for the second quarter of 2024 was $52.4 million, including unrealized derivative losses of $1.1 million. Excluding
unrealized derivative activity, segment profit in the second quarter of 2024 decreased approximately 11% sequentially and decreased approximately
28% over the second quarter of 2023. Segment results during the second quarter of 2024 reflect a full-quarter impact from the previously
disclosed one-time contract reset. |
| · | Average natural gas gathering and transportation volumes for the second quarter of 2024 were approximately 2% higher compared to the
first quarter of 2024 but were approximately 8% lower compared to the second quarter of 2023. |
| · | Average natural gas processing volumes for the second quarter of 2024 were approximately 1% higher compared to the first quarter of
2024 but were approximately 8% lower compared to the second quarter of 2023. |
Second Quarter 2024
Webcast Details
EnLink will host a webcast and conference
call to discuss second quarter 2024 results on August 7, 2024, at 8 a.m. Central time. The conference call will be broadcast
via an internet webcast, which can be accessed on the Investors page of EnLink's website at investors.enlink.com.
Interested parties can access an archived replay of the webcast on EnLink's website for at least 90 days following the event.
About the EnLink Midstream Companies
Headquartered in Dallas, EnLink
Midstream (NYSE: ENLC) provides integrated midstream infrastructure services for natural gas, crude oil, and NGLs, as well as
CO2 transportation for carbon capture and sequestration (CCS). Our large-scale, cash-flow-generating asset platforms are
in premier production basins and core demand centers, including the Permian Basin, Louisiana, Oklahoma, and North Texas. EnLink is
focused on maintaining the financial flexibility and operational excellence that enables us to strategically grow and create
sustainable value. Visit www.EnLink.com to learn how EnLink connects energy to life.
Non-GAAP Financial Information
This press release contains non-generally accepted accounting principles
financial measures that we refer to as adjusted EBITDA and free cash flow after distributions (FCFAD).
We define adjusted EBITDA as net income (loss) plus (less) interest
expense, net of interest income; depreciation and amortization; impairments; (income) loss from unconsolidated affiliate investments;
distributions from unconsolidated affiliate investments; (gain) loss on disposition of assets; (gain) loss on extinguishment of debt;
(gain) loss on litigation settlement; unit-based compensation; income tax expense (benefit); unrealized (gain) loss on commodity derivatives;
costs associated with the relocation of processing facilities; accretion expense associated with asset retirement obligations; transaction
costs; non-cash expense related to changes in the fair value of contingent consideration; (non-cash rent); and (non-controlling interest
share of adjusted EBITDA from joint ventures).
We define free cash flow after distributions as adjusted EBITDA, net
to ENLC, plus (less) (growth and maintenance capital expenditures, excluding capital expenditures that were contributed by other entities
and relate to the non-controlling interest share of our consolidated entities); (interest expense, net of interest income); (distributions
declared on common units); (cash distributions earned by the Series B Preferred Units and the Series C Preferred Units); (payment
to redeem mandatorily redeemable non-controlling interest); (earnout payments related to the Amarillo Rattler Acquisition and the Central
Oklahoma Acquisition); (costs associated with the relocation of processing facilities, excluding costs that were contributed by other
entities and relate to the non-controlling interest share of our consolidated entities); non-cash interest (income)/expense; (contributions
to investment in unconsolidated affiliates); (payments to terminate interest rate swaps); (current income taxes); (non-cash gain associated
with a lease modification); and proceeds from the sale of equipment and land.
EnLink believes these measures are useful to investors because they
may provide users of this financial information with meaningful comparisons between current results and previously-reported results and
a meaningful measure of the company’s cash flow after it has satisfied the capital and related requirements of its operations. In
addition, adjusted EBITDA is used as a metric in our short-term incentive program for compensating employees and in our performance awards
for executives.
Adjusted EBITDA and free cash flow after distributions, as defined
above, are not measures of financial performance or liquidity under GAAP. They should not be considered in isolation or as an indicator
of EnLink’s performance. Furthermore, they should not be seen as a substitute for metrics prepared in accordance with GAAP. Reconciliations
of these measures to their most directly comparable GAAP measures are included in the following tables. See EnLink’s filings with
the Securities and Exchange Commission for more information.
Other definitions and explanations of terms used in this press release:
Segment profit (loss) is defined as revenues, less cost of sales (exclusive
of operating expenses and depreciation and amortization), less operating expenses. Segment profit (loss) includes non-cash compensation
expenses reflected in operating expenses. See “Item 8. Financial Statements and Supplementary Data - Note 16 - Segment Information”
in ENLC’s Annual Report on Form 10-K for the year ended December 31, 2023, and, when available, “Item 1. Financial
Statements - Note 11—Segment Information” in ENLC’s Quarterly Report on Form 10-Q for the three months ended June 30,
2024, for further information about segment profit (loss).
The Ascension JV is a joint venture between a subsidiary of EnLink
and a subsidiary of Marathon Petroleum Corporation in which EnLink owns a 50% interest and Marathon Petroleum Corporation owns a 50% interest.
The Ascension JV, which began operations in April 2017, owns an NGL pipeline that connects EnLink’s Riverside fractionator
to Marathon Petroleum Corporation’s Garyville refinery.
The Delaware Basin JV is a joint venture between EnLink and an affiliate
of NGP Natural Resources XI, L.P. ("NGP") in which EnLink owns a 50.1% interest and NGP owns a 49.9% interest. The Delaware
Basin JV, which was formed in August 2016, owns the Lobo processing facilities and the Tiger processing plant located in the Delaware
Basin in Texas.
Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of the federal securities laws. Although these statements reflect the current views, assumptions and expectations of our management,
the matters addressed herein involve certain assumptions, risks and uncertainties that could cause actual activities, performance, outcomes
and results to differ materially from those indicated herein. Therefore, you should not rely on any of these forward-looking statements.
All statements, other than statements of historical fact, included in this press release constitute forward-looking statements, including,
but not limited to statements identified by the words “forecast,” “may,” “believe,” “will,”
“shall,” “should,” “plan,” “predict,” “anticipate,” “intend,”
“estimate,” “expect,” “continue,” and similar expressions. Such forward-looking statements include,
but are not limited to, statements about guidance, projected or forecasted financial and operating results, future results and growth
of our CCS business, potential financial arrangements with CCS counterparties, acquisitions, or growth capital expenditures, timing for
completion of construction or expansion projects, results in certain basins, cost savings or operational, environmental, and climate change
initiatives, profitability, financial or leverage metrics, repurchases of common or preferred units, our future capital structure and
credit ratings, objectives, strategies, expectations, and intentions, and other statements that are not historical facts. Factors that
could result in such differences or otherwise materially affect our financial condition, results of operations, or cash flows include,
without limitation (a) potential conflicts of interest of Global Infrastructure Partners (“GIP”) with us and the potential
for GIP to compete with us or favor GIP’s own interests to the detriment of our other unitholders, (b) adverse developments
in the midstream business that may reduce our ability to make distributions, (c) competition for crude oil, condensate, natural gas,
and NGL supplies and any decrease in the availability of such commodities, (d) decreases in the volumes that we gather, process,
fractionate, or transport, (e) our ability or our customers’ ability to receive or renew required government or third party
permits and other approvals, (f) increased federal, state, and local legislation, and regulatory initiatives, as well as government
reviews relating to hydraulic fracturing resulting in increased costs and reductions or delays in natural gas production by our customers,
(g) climate change legislation and regulatory initiatives resulting in increased operating costs and reduced demand for the natural
gas and NGL services we provide, (h) changes in the availability and cost of capital, (i) volatile prices and market demand
for crude oil, condensate, natural gas, and NGLs that are beyond our control, (j) debt levels that could limit our flexibility and
adversely affect our financial health or limit our flexibility to obtain financing and to pursue other business opportunities, (k) operating
hazards, natural disasters, weather-related issues or delays, casualty losses, and other matters beyond our control, (l) reductions
in demand for NGL products by the petrochemical, refining, or other industries or by the fuel markets, (m) our dependence on significant
customers for a substantial portion of the natural gas and crude that we gather, process, and transport, (n) construction risks in
our major development projects, (o) challenges we may face in connection with our strategy to build a CCS transportation business
and to enter into other new lines of business related to the energy transition, (p)our ability to effectively integrate and manage assets
we acquire through acquisitions, (q) the impact of the coronavirus (COVID-19) pandemic (including the impact of any new variants
of the virus) and similar pandemics, (r) impairments to goodwill, long-lived assets and equity method investments, and (s) the
effects of existing and future laws and governmental regulations, and other uncertainties. These and other applicable uncertainties, factors,
and risks are described more fully in EnLink Midstream, LLC’s filings with the Securities and Exchange Commission, including EnLink
Midstream, LLC’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K. EnLink
assumes no obligation to update any forward-looking statements.
The EnLink management team based the forecasted financial information
included herein on certain information and assumptions, including, among others, the producer budgets / forecasts to which EnLink has
access as of the date of this press release and the projects / opportunities expected to require capital expenditures as of the date of
this press release. The assumptions, information, and estimates underlying the forecasted financial information included in the guidance
information in this press release are inherently uncertain and, though considered reasonable by the EnLink management team as of the date
of its preparation, are subject to a wide variety of significant business, economic, and competitive risks and uncertainties that could
cause actual results to differ materially from those contained in the forecasted financial information. Accordingly, there can be no assurance
that the forecasted results are indicative of EnLink's future performance or that actual results will not differ materially from those
presented in the forecasted financial information. Inclusion of the forecasted financial information in this press release should not
be regarded as a representation by any person that the results contained in the forecasted financial information will be achieved.
EnLink
Midstream, LLC
Selected
Financial Data
(All
amounts in millions except per unit amounts)
(Unaudited)
| | |
Three
Months Ended
June 30, | | |
Six
Months Ended
June 30, | |
| | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| Total revenues (1) | |
$ | 1,551.1 | | |
$ | 1,530.1 | | |
$ | 3,199.0 | | |
$ | 3,297.6 | |
| | |
| | | |
| | | |
| | | |
| | |
| Operating costs and expenses: | |
| | | |
| | | |
| | | |
| | |
| Cost of sales, exclusive of operating
expenses and depreciation and amortization (2) | |
| 1,062.6 | | |
| 1,019.0 | | |
| 2,213.0 | | |
| 2,290.9 | |
| Operating expenses | |
| 155.2 | | |
| 136.8 | | |
| 307.8 | | |
| 269.2 | |
| Depreciation and amortization | |
| 162.6 | | |
| 165.3 | | |
| 327.9 | | |
| 325.7 | |
| Impairments | |
| — | | |
| — | | |
| 14.2 | | |
| — | |
| (Gain) loss on disposition of assets | |
| 0.9 | | |
| (0.8 | ) | |
| (0.8 | ) | |
| (1.2 | ) |
| General and administrative | |
| 30.2 | | |
| 27.9 | | |
| 85.4 | | |
| 57.4 | |
| Total operating costs and expenses | |
| 1,411.5 | | |
| 1,348.2 | | |
| 2,947.5 | | |
| 2,942.0 | |
| Operating income | |
| 139.6 | | |
| 181.9 | | |
| 251.5 | | |
| 355.6 | |
| Other income (expense): | |
| | | |
| | | |
| | | |
| | |
| Interest expense, net of interest income | |
| (66.7 | ) | |
| (68.8 | ) | |
| (132.1 | ) | |
| (137.3 | ) |
| Income (loss) from unconsolidated affiliate
investments | |
| 0.3 | | |
| (4.6 | ) | |
| (0.5 | ) | |
| (4.7 | ) |
| Other income | |
| 3.8 | | |
| 0.4 | | |
| 4.3 | | |
| 0.4 | |
| Total other expense | |
| (62.6 | ) | |
| (73.0 | ) | |
| (128.3 | ) | |
| (141.6 | ) |
| Income before non-controlling interest
and income taxes | |
| 77.0 | | |
| 108.9 | | |
| 123.2 | | |
| 214.0 | |
| Income tax expense | |
| (10.0 | ) | |
| (19.0 | ) | |
| (6.2 | ) | |
| (29.9 | ) |
| Net income | |
| 67.0 | | |
| 89.9 | | |
| 117.0 | | |
| 184.1 | |
| Net income attributable to non-controlling interest | |
| 28.9 | | |
| 35.6 | | |
| 64.4 | | |
| 71.6 | |
| Net income attributable to ENLC | |
$ | 38.1 | | |
$ | 54.3 | | |
$ | 52.6 | | |
$ | 112.5 | |
| Net income attributable to ENLC per unit: | |
| | | |
| | | |
| | | |
| | |
| Basic common unit | |
$ | 0.07 | | |
$ | 0.12 | | |
$ | 0.11 | | |
$ | 0.24 | |
| Diluted common unit | |
$ | 0.07 | | |
$ | 0.12 | | |
$ | 0.10 | | |
$ | 0.24 | |
| | |
| | | |
| | | |
| | | |
| | |
| Weighted average common units outstanding (basic) | |
| 451.4 | | |
| 462.7 | | |
| 451.3 | | |
| 465.8 | |
| Weighted average common units outstanding (diluted) | |
| 454.1 | | |
| 466.7 | | |
| 454.0 | | |
| 469.9 | |
| (1) | Includes related party revenue of $0.5 million and $0.6 million for the
three months ended June 30, 2024 and 2023, respectively, and $1.0 million and $1.3 million
for the six months ended June 30, 2024 and 2023, respectively. |
| (2) | Includes related party cost of sales of $1.4 million and $2.5 million
for the three months ended June 30, 2024 and 2023, respectively, and $2.8 million and
$4.0 million for the six months ended June 30, 2024 and 2023, respectively. |
EnLink
Midstream, LLC
Reconciliation
of Net Income to Adjusted EBITDA
(All
amounts in millions)
(Unaudited)
| | |
Three
Months Ended
June 30, | | |
Six
Months Ended
June 30, | |
| | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| Net income | |
$ | 67.0 | | |
$ | 89.9 | | |
$ | 117.0 | | |
$ | 184.1 | |
| Interest expense, net of interest income | |
| 66.7 | | |
| 68.8 | | |
| 132.1 | | |
| 137.3 | |
| Depreciation and amortization | |
| 162.6 | | |
| 165.3 | | |
| 327.9 | | |
| 325.7 | |
| Impairments | |
| — | | |
| — | | |
| 14.2 | | |
| — | |
| (Income) loss from unconsolidated affiliate investments | |
| (0.3 | ) | |
| 4.6 | | |
| 0.5 | | |
| 4.7 | |
| Distributions from unconsolidated affiliate investments | |
| — | | |
| 2.2 | | |
| — | | |
| 2.3 | |
| (Gain) loss on disposition of assets | |
| 0.9 | | |
| (0.8 | ) | |
| (0.8 | ) | |
| (1.2 | ) |
| Loss on litigation settlement (1) | |
| — | | |
| — | | |
| 23.0 | | |
| — | |
| Unit-based compensation | |
| 5.2 | | |
| 4.5 | | |
| 10.8 | | |
| 8.5 | |
| Income tax expense | |
| 10.0 | | |
| 19.0 | | |
| 6.2 | | |
| 29.9 | |
| Unrealized (gain) loss on commodity derivatives | |
| (4.0 | ) | |
| (5.3 | ) | |
| 22.1 | | |
| (3.9 | ) |
| Costs associated with the relocation of processing facilities
(2) | |
| 16.9 | | |
| 1.7 | | |
| 26.2 | | |
| 2.1 | |
| Other (3) | |
| (0.1 | ) | |
| 0.2 | | |
| 1.5 | | |
| 0.5 | |
| Adjusted EBITDA before non-controlling
interest | |
| 324.9 | | |
| 350.1 | | |
| 680.7 | | |
| 690.0 | |
| Non-controlling interest share of adjusted EBITDA from joint
ventures (4) | |
| (18.9 | ) | |
| (16.5 | ) | |
| (37.0 | ) | |
| (32.7 | ) |
| Adjusted EBITDA, net to ENLC | |
$ | 306.0 | | |
$ | 333.6 | | |
$ | 643.7 | | |
$ | 657.3 | |
| (1) | Relates to the loss incurred to settle litigation that arose from Winter
Storm Uri and is not part of our ongoing operations. |
| (2) | Represents cost incurred to execute discrete, project-based strategic
initiatives aimed at realigning available processing capacity from our Oklahoma and North
Texas segments to the Permian segment. These costs are not part of our ongoing operations. |
| (3) | Includes transaction costs, non-cash expense related to changes in the
fair value of contingent consideration, accretion expense associated with asset retirement
obligations, and non-cash rent, which relates to lease incentives pro-rated over the lease
term. |
| (4) | Non-controlling interest share of adjusted EBITDA from joint ventures
includes NGP Natural Resources XI, L.P. ("NGP")’s 49.9% share of adjusted
EBITDA from the Delaware Basin JV and Marathon Petroleum Corporation’s 50% share of
adjusted EBITDA from the Ascension JV. |
EnLink
Midstream, LLC
Reconciliation
of Net Cash Provided by Operating Activities to Adjusted EBITDA
and
Free Cash Flow After Distributions
(All
amounts in millions except ratios and per unit amounts)
(Unaudited)
| | |
Three
Months Ended
June 30, | | |
Six Months
Ended
June 30, | |
| | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| Net
cash provided by operating activities | |
$ | 162.6 | | |
$ | 315.7 | | |
$ | 455.9 | | |
$ | 587.8 | |
| Interest expense
(1) | |
| 65.2 | | |
| 67.0 | | |
| 129.1 | | |
| 134.0 | |
| Costs associated
with the relocation of processing facilities (2) | |
| 16.9 | | |
| 1.7 | | |
| 26.2 | | |
| 2.1 | |
| Loss on litigation
settlement (3) | |
| — | | |
| — | | |
| 23.0 | | |
| — | |
| Other (4) | |
| 0.2 | | |
| 2.0 | | |
| 4.0 | | |
| 0.8 | |
| Changes in operating
assets and liabilities which (provided) used cash: | |
| | | |
| | | |
| | | |
| | |
| Accounts receivable,
accrued revenues, inventories, and other | |
| 149.5 | | |
| (80.3 | ) | |
| 11.5 | | |
| (249.7 | ) |
| Accounts payable, accrued product purchases,
and other accrued liabilities | |
| (69.5 | ) | |
| 44.0 | | |
| 31.0 | | |
| 215.0 | |
| Adjusted EBITDA
before non-controlling interest | |
| 324.9 | | |
| 350.1 | | |
| 680.7 | | |
| 690.0 | |
| Non-controlling
interest share of adjusted EBITDA from joint ventures (5) | |
| (18.9 | ) | |
| (16.5 | ) | |
| (37.0 | ) | |
| (32.7 | ) |
| Adjusted EBITDA,
net to ENLC | |
| 306.0 | | |
| 333.6 | | |
| 643.7 | | |
| 657.3 | |
| Growth capital
expenditures, net to ENLC (6) | |
| (62.6 | ) | |
| (74.6 | ) | |
| (143.4 | ) | |
| (167.3 | ) |
| Maintenance
capital expenditures, net to ENLC (6) | |
| (20.0 | ) | |
| (20.0 | ) | |
| (34.3 | ) | |
| (34.2 | ) |
| Interest expense,
net of interest income | |
| (66.7 | ) | |
| (68.8 | ) | |
| (132.1 | ) | |
| (137.3 | ) |
| Distributions
declared on common units | |
| (60.9 | ) | |
| (58.1 | ) | |
| (120.6 | ) | |
| (116.8 | ) |
| ENLK preferred
unit cash distributions earned (7) | |
| (23.8 | ) | |
| (24.0 | ) | |
| (48.2 | ) | |
| (47.6 | ) |
| Earnout payments
(8) | |
| — | | |
| — | | |
| (2.5 | ) | |
| — | |
| Payment to redeem
mandatorily redeemable non-controlling interest (9) | |
| — | | |
| — | | |
| — | | |
| (10.5 | ) |
| Costs associated with the relocation
of processing facilities, net to ENLC (2)(6) | |
| (9.5 | ) | |
| 7.1 | | |
| (15.8 | ) | |
| 6.7 | |
| Contributions
to investment in unconsolidated affiliates | |
| (10.7 | ) | |
| — | | |
| (20.1 | ) | |
| (49.7 | ) |
| Other (10) | |
| 1.5 | | |
| 0.5 | | |
| 0.6 | | |
| 0.8 | |
| Free cash flow
after distributions | |
$ | 53.3 | | |
$ | 95.7 | | |
$ | 127.3 | | |
$ | 101.4 | |
| | |
| | | |
| | | |
| | | |
| | |
| Actual declared
distribution to common unitholders | |
$ | 60.9 | | |
$ | 58.1 | | |
$ | 120.6 | | |
$ | 116.8 | |
| Distribution
coverage | |
| 3.23 | x | |
| 3.77 | x | |
| 3.52 | x | |
| 3.64 | x |
| Distributions
declared per ENLC unit | |
$ | 0.1325 | | |
$ | 0.1250 | | |
$ | 0.2650 | | |
$ | 0.2500 | |
| (1) | Net of amortization of debt issuance costs, net discount of senior unsecured
notes, and designated cash flow hedge, which are included in interest expense but not included
in net cash provided by operating activities, and non-cash interest income, which is netted
against interest expense but not included in adjusted EBITDA. |
| (2) | Represents cost incurred to execute discrete, project-based strategic
initiatives aimed at realigning available processing capacity from our Oklahoma and North
Texas segments to the Permian segment. These costs are not part of our ongoing operations. |
| (3) | Relates to the loss incurred to settle litigation that arose from Winter
Storm Uri and is not part of our ongoing operations. |
| (4) | Includes utility credits redeemed, distributions from unconsolidated
affiliate investments in excess of earnings, transaction costs, current income tax expense,
and non-cash rent, which relates to lease incentives pro-rated over the lease term. |
| (5) | Non-controlling interest share of adjusted EBITDA from joint ventures
includes NGP's 49.9% share of adjusted EBITDA from the Delaware Basin JV and Marathon Petroleum
Corporation's 50% share of adjusted EBITDA from the Ascension JV. |
| (6) | Excludes capital expenditures and costs associated with the relocation
of processing facilities that were contributed by other entities and relate to the non-controlling
interest share of our consolidated entities. |
| (7) | Represents the cash distributions earned by the Series B Preferred
Units and Series C Preferred Units, which are not available to common unitholders. |
| (8) | Earnout payments were made in connection to the consideration paid for
the Amarillo Rattler Acquisition and the Central Oklahoma Acquisition, both of which included
a contingent component payable beginning in 2024. |
| (9) | In January 2023, we settled the redemption of the mandatorily redeemable
non-controlling interest in one of our non-wholly owned subsidiaries. |
| (10) | Includes current income tax expense, a reduction for non-cash gain associated
with a lease modification, and proceeds from the sale of surplus or unused equipment and
land, which occurred in the normal operation of our business. |
EnLink
Midstream, LLC
Operating
Data
(Unaudited)
| | |
Three
Months Ended
June 30, | | |
Six
Months Ended
June 30, | |
| | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| Midstream Volumes: | |
| | | |
| | | |
| | | |
| | |
| Permian Segment | |
| | | |
| | | |
| | | |
| | |
| Gathering and Transportation
(MMBtu/d) | |
| 2,033,300 | | |
| 1,732,200 | | |
| 1,966,300 | | |
| 1,708,100 | |
| Processing (MMBtu/d) | |
| 1,850,400 | | |
| 1,617,400 | | |
| 1,797,800 | | |
| 1,589,200 | |
| Crude Oil Handling (Bbls/d) | |
| 191,100 | | |
| 155,400 | | |
| 177,900 | | |
| 149,000 | |
| Louisiana Segment | |
| | | |
| | | |
| | | |
| | |
| Gathering and Transportation (MMBtu/d) | |
| 2,819,700 | | |
| 2,345,600 | | |
| 2,786,800 | | |
| 2,518,600 | |
| Crude Oil Handling (Bbls/d) | |
| — | | |
| 16,500 | | |
| — | | |
| 17,400 | |
| NGL Fractionation (Bbls/d) | |
| 175,300 | | |
| 179,000 | | |
| 179,500 | | |
| 181,100 | |
| Brine Disposal (Bbls/d) | |
| — | | |
| 2,700 | | |
| — | | |
| 2,800 | |
| Oklahoma Segment | |
| | | |
| | | |
| | | |
| | |
| Gathering and Transportation (MMBtu/d) | |
| 1,219,000 | | |
| 1,253,800 | | |
| 1,181,700 | | |
| 1,216,300 | |
| Processing (MMBtu/d) | |
| 1,173,200 | | |
| 1,204,600 | | |
| 1,132,100 | | |
| 1,184,500 | |
| Crude Oil Handling (Bbls/d) | |
| 17,800 | | |
| 26,800 | | |
| 19,100 | | |
| 27,000 | |
| North Texas Segment | |
| | | |
| | | |
| | | |
| | |
| Gathering and Transportation (MMBtu/d) | |
| 1,473,100 | | |
| 1,593,600 | | |
| 1,461,500 | | |
| 1,605,300 | |
| Processing (MMBtu/d) | |
| 677,500 | | |
| 740,000 | | |
| 673,200 | | |
| 742,300 | |
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