DENVER, July 28, 2021 /PRNewswire/ -- Antero
Midstream Corporation (NYSE: AM) ("Antero Midstream" or the
"Company") today announced its second quarter 2021 financial and
operational results. The relevant consolidated financial
statements are included in Antero Midstream's Quarterly Report on
Form 10-Q for the quarter ended June 30,
2021.
Second Quarter 2021 Earnings Highlights:
- Net income was $80 million, or
$0.17 per share, compared to
$0.19 per share in the prior year
quarter
- Adjusted Net Income was $109
million, or $0.23 per share, a
10% increase compared to $0.21 per
share in the prior year quarter (non-GAAP measure)
- Adjusted EBITDA was $225
million, a 12% increase compared to the prior year quarter
(non-GAAP measure)
- Capital expenditures were $71
million
- Net cash provided by operating activities was $195 million
- Free Cash Flow before dividends was $111 million, a 4% increase compared to the prior
year quarter (non-GAAP measure)
- Free Cash Flow after dividends was $3
million, compared to a $40
million deficit in the prior year quarter (non-GAAP
measure)
- Refinanced $650 million of
5.375% senior notes due 2024 with $750
million of 5.375% senior notes due 2029, resulting in no
senior note maturities until 2026
- Reduced Net Debt to last twelve months Adjusted EBITDA to
3.6x at quarter-end (non-GAAP measure)
Paul Rady, Chairman and CEO said,
"Antero Midstream delivered another strong quarter operationally
with year-over-year volumetric and Free Cash Flow growth. This was
a direct result of Antero Midstream's focus on operating expense
and capital efficiencies, as well as high asset utilization rates
across our integrated assets. In addition, Antero Midstream
realized consistent volumetric throughput during the quarter,
benefitting from Antero Resources' firm transportation portfolio
which allowed it to avoid the volatility in local Appalachian
basis."
Mr. Rady further added, "Antero Midstream continues to
demonstrate the ability to deliver attractive returns through
organic capital investments. These organic capital investments with
high utilization rates have allowed us to consistently generate
mid-teen returns on invested capital."
For a discussion of the non-GAAP financial measures including
Adjusted Net Income, Adjusted EBITDA, Free Cash Flow and Net Debt
please see "Non-GAAP Financial Measures."
Second Quarter 2021 Financial Results
Low pressure gathering volumes for the second quarter of 2021
averaged 2,897 MMcf/d, a 1% increase as compared to the prior year
quarter. Compression volumes for the second quarter of 2021
averaged 2,744 MMcf/d, a 1% increase as compared to the second
quarter of 2020. High pressure gathering volumes for the
second quarter of 2021 averaged 2,826 MMcf/d, in line with the
second quarter of 2020. Fresh water delivery volumes averaged 104
MBbl/d during the quarter, a 2% increase compared to the second
quarter of 2020.
Gross processing volumes from the Company's processing and
fractionation joint venture with MPLX ("Joint Venture") averaged
1,450 MMcf/d for the second quarter of 2021, a 3% increase compared
to the prior year quarter. Joint Venture processing capacity
was approximately 100% utilized during the quarter based on
nameplate processing capacity of 1.4 Bcf/d. Gross Joint
Venture fractionation volumes averaged 38 MBbl/d, a 15% increase
compared to the prior year quarter. Joint Venture fractionation
capacity was 95% utilized during the quarter relative to total
fractionation capacity of 40 MBbl/d.
|
|
Three Months
Ended
June
30,
|
|
Average Daily
Volumes:
|
|
2020
|
|
2021
|
|
%
Change
|
|
Low Pressure Gathering
(MMcf/d)
|
|
2,869
|
|
2,897
|
|
1%
|
|
Compression
(MMcf/d)
|
|
2,712
|
|
2,744
|
|
1%
|
|
High Pressure
Gathering (MMcf/d)
|
|
2,839
|
|
2,826
|
|
0%
|
|
Fresh Water Delivery
(MBbl/d)
|
|
102
|
|
104
|
|
2%
|
|
Gross Joint Venture
Processing (MMcf/d)
|
|
1,404
|
|
1,450
|
|
3%
|
|
Gross Joint Venture
Fractionation (MBbl/d)
|
|
33
|
|
38
|
|
15%
|
|
For the three months ended June 30,
2021, revenues were $233
million, comprised of $193
million from the Gathering and Processing segment and
$58 million from the Water Handling
segment, net of $18 million of
amortization of customer relationships. Water Handling
revenues included $20 million from
wastewater handling and high rate water transfer services.
Direct operating expenses for the Gathering and Processing and
Water Handling segments were $17
million and $23 million,
respectively, for a total of $40
million, compared to $42
million in total direct operating expenses in the prior year
quarter. Water Handling operating expenses included $19 million from wastewater handling and high
rate water transfer services. The decrease in direct operating
expenses was driven primarily by lower costs associated with
flowback and produced water due to Antero Midstream's blending
operations. General and administrative expenses excluding
equity-based compensation were $11
million during the second quarter of 2021. Total
operating expenses during the second quarter of 2021 included
$3 million of equity compensation
expense and $27 million of
depreciation. Additionally, there was a $21 million loss on early extinguishment of debt
related to the premium paid to refinance the senior notes due 2024
with the $750 million senior notes
due 2029.
Net income was $80 million, or
$0.17 per share. Net income
adjusted for amortization of customer relationships, loss (gain) on
asset sale and loss on early extinguishment of debt, net of tax
effects of reconciling items, or Adjusted Net Income, was
$109 million. Adjusted Net Income per
share was $0.23 per share, a 10%
increase compared to the prior year quarter.
The following table reconciles Net Income to Adjusted Net
Income:
|
|
Three Months
Ended June
30,
|
|
|
|
2020
|
|
|
2021
|
Net
Income
|
|
$
|
88,441
|
|
|
80,223
|
Amortization of
customer relationships
|
|
|
17,606
|
|
|
17,668
|
Loss (gain) on asset
sale
|
|
|
240
|
|
|
(135)
|
Loss on early
extinguishment of debt
|
|
|
—
|
|
|
20,701
|
Tax effect of
reconciling items(1)
|
|
|
(4,408)
|
|
|
(9,532)
|
Adjusted Net
Income
|
|
$
|
101,879
|
|
|
108,925
|
|
|
(1)
|
Statutory tax rate
was approximately 24.7% for 2020 and 24.9% for 2021.
|
Adjusted EBITDA was $225 million,
a 12% increase compared to the prior year quarter. Interest expense
was $44 million, a 26% increase
compared to the prior year quarter, driven by the issuances of
senior notes due 2026 and 2029. Capital expenditures were
$71 million, a 20% increase compared
to the prior year quarter as Antero Midstream began construction on
growth projects supporting the drilling partnership between Antero
Resources and QL Capital Partners, an affiliate of Quantum Energy.
Free Cash Flow before dividends was $111 million, a 4% increase compared to the prior
year quarter and Free Cash Flow after dividends was $3 million compared to a deficit of $40 million in the prior year quarter.
The following table reconciles Net Income to Adjusted EBITDA and
Free Cash Flow before and after dividends:
|
|
Three Months
Ended June
30,
|
|
|
|
2020
|
|
|
2021
|
Net
Income
|
|
$
|
88,441
|
|
|
80,223
|
Interest expense,
net
|
|
|
35,311
|
|
|
43,505
|
Provision for income
tax expense
|
|
|
31,921
|
|
|
28,485
|
Amortization of
customer relationships
|
|
|
17,606
|
|
|
17,668
|
Depreciation
expense
|
|
|
27,745
|
|
|
26,619
|
Accretion of asset
retirement obligations
|
|
|
61
|
|
|
114
|
Equity-based
compensation
|
|
|
2,697
|
|
|
3,059
|
Equity in earnings of
unconsolidated affiliates
|
|
|
(20,947)
|
|
|
(21,515)
|
Distributions from
unconsolidated affiliates
|
|
|
18,200
|
|
|
26,275
|
Loss on early
extinguishment of debt
|
|
|
—
|
|
|
20,701
|
Loss (gain) on asset
sale
|
|
|
240
|
|
|
(135)
|
Adjusted
EBITDA
|
|
$
|
201,275
|
|
|
224,999
|
Interest
expense
|
|
|
(35,311)
|
|
|
(43,505)
|
Total capital
expenditures (accrual-based)
|
|
|
(59,001)
|
|
|
(70,893)
|
Free Cash Flow
before dividends
|
|
$
|
106,963
|
|
|
110,601
|
Dividends declared
(accrual-based)
|
|
|
(146,554)
|
|
|
(107,409)
|
Free Cash Flow
after dividends
|
|
$
|
(39,591)
|
|
|
3,192
|
The following table reconciles net cash provided by operating
activities to Free Cash Flow before and after dividends:
|
|
Three Months
Ended June
30,
|
|
|
|
2020
|
|
|
2021
|
Net cash provided
by operating activities
|
|
$
|
241,427
|
|
|
194,674
|
Amortization of
deferred financing costs
|
|
|
(1,100)
|
|
|
(1,345)
|
Settlement of asset
retirement obligations
|
|
|
601
|
|
|
194
|
Changes in working
capital
|
|
|
(74,964)
|
|
|
(12,029)
|
Total capital
expenditures (accrual-based)
|
|
|
(59,001)
|
|
|
(70,893)
|
Free Cash Flow
before dividends
|
|
$
|
106,963
|
|
|
110,601
|
Dividends declared
(accrual-based)
|
|
|
(146,554)
|
|
|
(107,409)
|
Free Cash Flow
after dividends
|
|
$
|
(39,591)
|
|
|
3,192
|
Second Quarter 2021 Operating Update
Gathering and Processing — During the
second quarter of 2021, Antero Midstream connected 23 wells to its
gathering system. The Company's 3.2 Bcf/d of compression capacity
was approximately 86% utilized during the quarter. Joint Venture
processing capacity of 1.4 Bcf/d was approximately 100% utilized
and Joint Venture fractionation capacity was 95% utilized during
the quarter. During the second quarter the Joint Venture began
commissioning the Smithburg 1 processing plant, which will add 200
MMcf/d of incremental processing capacity in the third quarter of
2021. This expansion of processing capacity will bring the Joint
Venture's total processing capacity to 1.6 Bcf/d.
Water Handling— Antero Midstream's water
delivery systems serviced 17 well completions during the second
quarter of 2021, a 23% decrease from the prior year quarter, driven
by a reduction in completion activity by Antero Resources as it
transitioned to a maintenance capital development program.
Balance Sheet and Liquidity
As of June 30, 2021, Antero
Midstream had approximately $514
million drawn on its $2.13
billion bank credit facility, resulting in $1.6 billion of liquidity. Antero Midstream's Net
Debt to trailing twelve months Adjusted EBITDA ("Leverage") was
3.6x as of June 30, 2021.
Capital Investments
Total accrued capital expenditures including investments in the
Joint Venture were $71 million during
the second quarter of 2021. Gathering, compression, and water
infrastructure capital investments totaled $70 million and investments in unconsolidated
affiliates for the Joint Venture were less than $1 million. Of the $70
million invested in gathering, compression, and water
infrastructure, $58 million was in
gathering and compression assets and $12
million was in water handling assets.
Brendan Krueger, CFO of Antero
Midstream, said, "The second quarter represented another strong
quarter, generating Free Cash Flow after dividends and ending the
quarter with leverage of 3.6x. Importantly, with the recent
issuance of the senior notes due 2029, Antero Midstream does not
have any senior note maturities within the next five years. This
strong balance sheet, combined with Antero Midstream's scale, cash
flow growth and an attractive dividend that is funded within free
cash flow provide a differentiated business model."
Conference Call
A conference call for Antero Midstream is scheduled on
Thursday, July 29, 2021 at
10:00 am MT to discuss the financial
and operational results. A brief Q&A session for security
analysts will immediately follow the discussion of the results for
the quarter. To participate in the call, dial in at
877-407-9126 (U.S.), or 201-493-6751 (International) and reference
"Antero Midstream". A telephone replay of the call will be
available until Thursday, August 5,
2021 at 10:00 am MT at
877-660-6853 (U.S.) or 201-612-7415 (International) using the
conference ID: 13720341. To access the live webcast and view the
related earnings conference call presentation, visit Antero
Midstream's website at www.anteromidstream.com. The webcast
will be archived for replay until Thursday,
August 5, 2021 at 10:00 am
MT.
Non-GAAP Financial Measures and Definitions
Antero Midstream uses certain non-GAAP financial measures.
Antero Midstream defines Adjusted Net Income as net income plus
amortization of customer contracts, impairment expense, and loss
(gain) on asset sale and loss on early extinguishment of debt, net
of tax effect of reconciling items. Antero Midstream uses Adjusted
Net Income to assess the operating performance of its assets.
Antero Midstream defines Adjusted EBITDA as net income plus
interest expense, provision for income tax expense (benefit),
amortization of customer relationships, depreciation expense,
impairment expense, accretion, equity-based compensation expense,
excluding equity in earnings of unconsolidated affiliates, plus
cash distributions from unconsolidated affiliates, loss (gain) on
asset sale and loss on early extinguishment of debt.
Antero Midstream uses Adjusted EBITDA to assess:
- the financial performance of Antero Midstream's assets, without
regard to financing methods, capital structure or historical cost
basis;
- its operating performance and return on capital as compared to
other publicly traded companies in the midstream energy sector,
without regard to financing or capital structure; and
- the viability of acquisitions and other capital expenditure
projects.
Antero Midstream defines Free Cash Flow before dividends as
Adjusted EBITDA less interest expense and accrued capital
expenditures. Free Cash Flow after dividends is defined as Free
Cash Flow before dividends less dividends declared for the quarter.
Antero Midstream uses Free Cash Flow before and after dividends as
a performance metric to compare the cash generating performance of
Antero Midstream from period to period.
Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow before
and after dividends are non-GAAP financial measures. The GAAP
measure most directly comparable to Adjusted EBITDA and Adjusted
Net Income is Net Income. The GAAP measure most directly comparable
to Free Cash Flow before and after dividends is cash flows provided
by (used in) operating activities. Such non-GAAP financial
measures should not be considered as alternatives to the GAAP
measures of Net Income and cash flows provided by (used in)
operating activities. The presentations of such measures are
not made in accordance with GAAP and have important limitations as
analytical tools because they include some, but not all, items that
affect Net Income and cash flows provided by (used in) operating
activities. You should not consider any or all such measures
in isolation or as a substitute for analyses of results as reported
under GAAP. Antero Midstream's definitions of such measures
may not be comparable to similarly titled measures of other
companies.
Antero Midstream defines Net Debt as consolidated total debt
less cash and cash equivalents. Antero Midstream views Net Debt as
an important indicator in evaluating Antero Midstream's financial
leverage.
This release also includes certain non-GAAP financial
information for Antero Resources. For a more information regarding
those measures, please see Antero Resources' press release dated
today, a copy of which can be found on Antero Resources website,
www.anteroresources.com.
The following table reconciles cash paid for capital
expenditures and accrued capital expenditures during the period (in
thousands):
|
|
Three Months
Ended June 30,
|
|
|
|
2020
|
|
|
2021
|
|
Capital
expenditures (as reported on a cash basis)
|
|
$
|
(65,729)
|
|
|
(46,185)
|
|
Change in accrued
capital costs
|
|
|
6,728
|
|
|
(24,708)
|
|
Capital
expenditures (accrual basis)
|
|
$
|
(59,001)
|
|
|
(70,893)
|
|
The following table reconciles consolidated total debt to
consolidated net debt, excluding debt premiums and issuance costs,
("Net Debt") as used in this release (in thousands):
|
|
March
31, 2021
|
|
June
30, 2021
|
Bank credit
facility
|
|
$
|
624,500
|
|
513,700
|
5.375% senior notes
due 2024
|
|
|
650,000
|
|
—
|
7.875% senior notes
due 2026
|
|
|
550,000
|
|
550,000
|
5.75% senior notes due
2027
|
|
|
650,000
|
|
650,000
|
5.75% senior notes due
2028
|
|
|
650,000
|
|
650,000
|
5.375% senior notes
due 2029
|
|
|
—
|
|
750,000
|
Consolidated total
debt
|
|
|
3,124,500
|
|
3,113,700
|
Cash and cash
equivalents
|
|
|
(261)
|
|
(678)
|
Consolidated net
debt
|
|
$
|
3,124,239
|
|
3,113,022
|
The following table reconciles net income to Adjusted EBITDA for
the last twelve months as used in this release (in thousands):
|
|
12 months
ended March 31,
2021
|
|
12 months
ended June 30,
2021
|
Net
Income
|
|
$
|
353,847
|
|
345,629
|
Amortization of
customer relationships
|
|
|
70,735
|
|
70,797
|
Impairment
expense
|
|
|
10,475
|
|
10,475
|
Interest
expense
|
|
|
152,242
|
|
160,436
|
Income tax
expense
|
|
|
117,121
|
|
113,685
|
Depreciation
expense
|
|
|
108,297
|
|
107,171
|
Accretion of asset
retirement obligations
|
|
|
257
|
|
310
|
Equity-based
compensation
|
|
|
13,452
|
|
13,814
|
Loss on asset
sale
|
|
|
6,692
|
|
6,317
|
Loss on early
extinguishment of debt
|
|
|
—
|
|
20,701
|
Equity in earnings of
unconsolidated affiliates
|
|
|
(88,097)
|
|
(88,665)
|
Distributions from
unconsolidated affiliates
|
|
|
107,140
|
|
115,215
|
Adjusted
EBITDA
|
|
$
|
852,161
|
|
875,885
|
Antero Midstream Corporation is a Delaware corporation that owns, operates and
develops midstream gathering, compression, processing and
fractionation assets located in the Appalachian Basin, as well as
integrated water assets that primarily service Antero Resources
Corporation's properties.
This release includes "forward-looking statements." Such
forward-looking statements are subject to a number of risks and
uncertainties, many of which are not under Antero Midstream's
control. All statements, except for statements of historical fact,
made in this release regarding activities, events or developments
Antero Midstream expects, believes or anticipates will or may occur
in the future, such as statements regarding Antero Midstream's
ability to execute its business plan and return capital to its
stockholders, information regarding Antero Midstream's return of
capital policy, information regarding long-term financial and
operating outlooks for Antero Midstream and Antero Resources,
information regarding Antero Resources' expected future growth and
its ability to meet its drilling and development plan and
the participation level of Antero Resources' drilling partner and
the impact on demand for Antero Midstream's services as a result of
incremental production by Antero Resources, are forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Exchange Act of 1934. All
forward-looking statements speak only as of the date of this
release. Although Antero Midstream believes that the plans,
intentions and expectations reflected in or suggested by the
forward-looking statements are reasonable, there is no assurance
that these plans, intentions or expectations will be achieved.
Therefore, actual outcomes and results could materially differ from
what is expressed, implied or forecast in such statements. Except
as required by law, Antero Midstream expressly disclaims any
obligation to and does not intend to publicly update or revise any
forward-looking statements.
Antero Midstream cautions you that these forward-looking
statements are subject to all of the risks and uncertainties
incident to our business, most of which are difficult to predict
and many of which are beyond Antero Midstream's control. These
risks include, but are not limited to, commodity price volatility,
inflation, environmental risks, Antero Resources' drilling and
completion and other operating risks, regulatory changes, the
uncertainty inherent in projecting Antero Resources' future rates
of production, cash flows and access to capital, the timing of
development expenditures, impacts of world health events, including
the COVID-19 pandemic, cybersecurity risk, and the other risks
described under the heading "Item 1A. Risk Factors" in Antero
Midstream's Annual Report on Form 10-K for the year ended
December 31, 2020.
ANTERO MIDSTREAM
CORPORATION
|
Condensed
Consolidated Balance Sheets
|
(In
thousands)
|
|
|
|
|
|
(Unaudited)
|
|
|
|
December 31,
|
|
June 30,
|
|
|
|
2020
|
|
2021
|
|
Assets
|
Current
assets:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
640
|
|
|
678
|
|
Accounts
receivable–Antero Resources
|
|
|
73,722
|
|
|
89,996
|
|
Accounts
receivable–third party
|
|
|
839
|
|
|
466
|
|
Income tax
receivable
|
|
|
17,251
|
|
|
940
|
|
Other current
assets
|
|
|
1,479
|
|
|
358
|
|
Total current
assets
|
|
|
93,931
|
|
|
92,438
|
|
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
|
3,254,044
|
|
|
3,293,791
|
|
Investments in
unconsolidated affiliates
|
|
|
722,478
|
|
|
707,518
|
|
Deferred tax
asset
|
|
|
103,402
|
|
|
46,893
|
|
Customer
relationships
|
|
|
1,427,447
|
|
|
1,392,111
|
|
Other assets,
net
|
|
|
9,610
|
|
|
7,991
|
|
Total
assets
|
|
$
|
5,610,912
|
|
|
5,540,742
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable–Antero Resources
|
|
$
|
3,862
|
|
|
4,238
|
|
Accounts payable–third
party
|
|
|
9,495
|
|
|
24,785
|
|
Accrued
liabilities
|
|
|
74,947
|
|
|
83,620
|
|
Other current
liabilities
|
|
|
5,701
|
|
|
5,194
|
|
Total current
liabilities
|
|
|
94,005
|
|
|
117,837
|
|
Long-term
liabilities:
|
|
|
|
|
|
|
|
Long-term
debt
|
|
|
3,091,626
|
|
|
3,087,734
|
|
Other
|
|
|
6,995
|
|
|
6,735
|
|
Total
liabilities
|
|
|
3,192,626
|
|
|
3,212,306
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity:
|
|
|
|
|
|
|
|
Preferred stock, $0.01
par value: 100,000 authorized as of both December 31, 2020 and June
30, 2021
|
|
|
|
|
|
|
|
Series A non-voting
perpetual preferred stock; 12 designated and 10 issued and
outstanding as of both December 31, 2020 and June 30,
2021
|
|
|
—
|
|
|
—
|
|
Common stock, $0.01
par value; 2,000,000 authorized; 476,639 and 477,358 issued and
outstanding as of December 31, 2020 and June 30, 2021,
respectively
|
|
|
4,766
|
|
|
4,774
|
|
Additional paid-in
capital
|
|
|
2,877,612
|
|
|
2,624,090
|
|
Accumulated
deficit
|
|
|
(464,092)
|
|
|
(300,428)
|
|
Total stockholders'
equity
|
|
|
2,418,286
|
|
|
2,328,436
|
|
Total liabilities and
stockholders' equity
|
|
$
|
5,610,912
|
|
|
5,540,742
|
|
ANTERO MIDSTREAM
CORPORATION
|
Condensed
Consolidated Statements of Operations and Comprehensive
Income
|
(In thousands, except
per share amounts)
|
(Unaudited)
|
|
|
|
Three Months Ended
June 30,
|
|
|
|
2020
|
|
2021
|
|
Revenue:
|
|
|
|
|
|
|
|
Gathering and
compression–Antero Resources
|
|
$
|
173,991
|
|
|
192,667
|
|
Water handling–Antero
Resources
|
|
|
63,351
|
|
|
57,718
|
|
Water handling–third
party
|
|
|
—
|
|
|
70
|
|
Amortization of
customer relationships
|
|
|
(17,606)
|
|
|
(17,668)
|
|
Total
revenue
|
|
|
219,736
|
|
|
232,787
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Direct
operating
|
|
|
42,067
|
|
|
39,555
|
|
General and
administrative (including $2,697 and $3,059 of equity-based
compensation in 2020 and 2021, respectively)
|
|
|
12,422
|
|
|
14,251
|
|
Facility
idling
|
|
|
2,475
|
|
|
984
|
|
Depreciation
|
|
|
27,745
|
|
|
26,619
|
|
Accretion of asset
retirement obligations
|
|
|
61
|
|
|
114
|
|
Loss (gain) on asset
sale
|
|
|
240
|
|
|
(135)
|
|
Total operating
expenses
|
|
|
85,010
|
|
|
81,388
|
|
Operating
income
|
|
|
134,726
|
|
|
151,399
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
|
(35,311)
|
|
|
(43,505)
|
|
Equity in earnings of
unconsolidated affiliates
|
|
|
20,947
|
|
|
21,515
|
|
Loss on early
extinguishment of debt
|
|
|
—
|
|
|
(20,701)
|
|
Total other
expense
|
|
|
(14,364)
|
|
|
(42,691)
|
|
Income before income
taxes
|
|
|
120,362
|
|
|
108,708
|
|
Provision for income
tax expense
|
|
|
(31,921)
|
|
|
(28,485)
|
|
Net income and
comprehensive income
|
|
$
|
88,441
|
|
|
80,223
|
|
|
|
|
|
|
|
|
|
Net income per
share–basic
|
|
$
|
0.19
|
|
|
0.17
|
|
Net income per
share–diluted
|
|
$
|
0.18
|
|
|
0.17
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
|
|
476,836
|
|
|
477,290
|
|
Diluted
|
|
|
478,837
|
|
|
479,530
|
|
ANTERO MIDSTREAM
CORPORATION
|
Selected Operating
Data
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
Amount
of
|
|
|
|
|
|
|
June 30,
|
|
Increase
|
|
Percentage
|
|
|
2020
|
|
2021
|
|
or
Decrease
|
|
Change
|
Operating
Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gathering—low pressure
(MMcf)
|
|
|
261,039
|
|
|
263,640
|
|
|
2,601
|
|
|
1
|
%
|
Gathering—high
pressure (MMcf)
|
|
|
258,380
|
|
|
257,193
|
|
|
(1,187)
|
|
|
*
|
|
Compression
(MMcf)
|
|
|
246,790
|
|
|
249,681
|
|
|
2,891
|
|
|
1
|
%
|
Fresh water delivery
(MBbl)
|
|
|
9,318
|
|
|
9,499
|
|
|
181
|
|
|
2
|
%
|
Other fluid handling
(MBbl)
|
|
|
5,433
|
|
|
4,381
|
|
|
(1,052)
|
|
|
(19)
|
%
|
Wells serviced by
fresh water delivery
|
|
|
22
|
|
|
17
|
|
|
(5)
|
|
|
(23)
|
%
|
Gathering—low pressure
(MMcf/d)
|
|
|
2,869
|
|
|
2,897
|
|
|
28
|
|
|
1
|
%
|
Gathering—high
pressure (MMcf/d)
|
|
|
2,839
|
|
|
2,826
|
|
|
(13)
|
|
|
*
|
|
Compression
(MMcf/d)
|
|
|
2,712
|
|
|
2,744
|
|
|
32
|
|
|
1
|
%
|
Fresh water delivery
(MBbl/d)
|
|
|
102
|
|
|
104
|
|
|
2
|
|
|
2
|
%
|
Other fluid handling
(MBbl/d)
|
|
|
60
|
|
|
48
|
|
|
(12)
|
|
|
(20)
|
%
|
Average Realized
Fees:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average gathering—low
pressure fee ($/Mcf) (1)
|
|
$
|
0.33
|
|
|
0.33
|
|
|
—
|
|
|
*
|
|
Average gathering—high
pressure fee ($/Mcf)
|
|
$
|
0.20
|
|
|
0.20
|
|
|
—
|
|
|
*
|
|
Average compression
fee ($/Mcf)
|
|
$
|
0.20
|
|
|
0.20
|
|
|
—
|
|
|
*
|
|
Average fresh water
delivery fee ($/Bbl)
|
|
$
|
3.96
|
|
|
3.97
|
|
|
0.01
|
|
|
*
|
|
Joint Venture
Operating Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Processing—Joint
Venture (MMcf)
|
|
|
127,791
|
|
|
131,912
|
|
|
4,121
|
|
|
3
|
%
|
Fractionation—Joint
Venture (MBbl)
|
|
|
3,014
|
|
|
3,417
|
|
|
403
|
|
|
13
|
%
|
Processing—Joint
Venture (MMcf/d)
|
|
|
1,404
|
|
|
1,450
|
|
|
46
|
|
|
3
|
%
|
Fractionation—Joint
Venture (MBbl/d)
|
|
|
33
|
|
|
38
|
|
|
5
|
|
|
15
|
%
|
|
|
*
|
Not meaningful or
applicable
|
(1)
|
The three months
ended June 30, 2021 average realized fee does not include $3.3
million of low pressure gathering fee revenues which volumes relate
to prior periods.
|
ANTERO MIDSTREAM
CORPORATION
|
|
Condensed
Consolidated Results of Segment Operations
|
|
(Unaudited)
|
|
|
|
|
|
Three Months Ended
June 30, 2021
|
|
|
|
Gathering and
|
|
Water
|
|
|
|
Consolidated
|
|
(in
thousands)
|
Processing
|
|
Handling
|
|
Unallocated
(1)
|
|
Total
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue–Antero
Resources
|
$
|
192,667
|
|
|
57,718
|
|
|
—
|
|
|
250,385
|
|
Revenue–third-party
|
|
|
—
|
|
|
70
|
|
|
—
|
|
|
70
|
|
Amortization of
customer relationships
|
|
|
(9,271)
|
|
|
(8,397)
|
|
|
—
|
|
|
(17,668)
|
|
Total
revenues
|
|
|
183,396
|
|
|
49,391
|
|
|
—
|
|
|
232,787
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct
operating
|
|
|
17,012
|
|
|
22,543
|
|
|
—
|
|
|
39,555
|
|
General and
administrative (excluding equity-based compensation)
|
|
|
6,412
|
|
|
4,364
|
|
|
416
|
|
|
11,192
|
|
Equity-based
compensation
|
|
|
2,322
|
|
|
509
|
|
|
228
|
|
|
3,059
|
|
Facility
idling
|
|
|
—
|
|
|
984
|
|
|
—
|
|
|
984
|
|
Depreciation
|
|
|
14,404
|
|
|
12,215
|
|
|
—
|
|
|
26,619
|
|
Accretion of asset
retirement obligations
|
|
|
—
|
|
|
114
|
|
|
—
|
|
|
114
|
|
Gain on asset
sale
|
|
|
(135)
|
|
|
—
|
|
|
—
|
|
|
(135)
|
|
Total operating
expenses
|
|
|
40,015
|
|
|
40,729
|
|
|
644
|
|
|
81,388
|
|
Operating
income
|
|
|
143,381
|
|
|
8,662
|
|
|
(644)
|
|
|
151,399
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
|
—
|
|
|
—
|
|
|
(43,505)
|
|
|
(43,505)
|
|
Equity in earnings of
unconsolidated affiliates
|
|
|
21,515
|
|
|
—
|
|
|
—
|
|
|
21,515
|
|
Loss on early
extinguishment of debt
|
|
|
—
|
|
|
—
|
|
|
(20,701)
|
|
|
(20,701)
|
|
Total other income
(expense)
|
|
|
21,515
|
|
|
—
|
|
|
(64,206)
|
|
|
(42,691)
|
|
Income before
taxes
|
|
|
164,896
|
|
|
8,662
|
|
|
(64,850)
|
|
|
108,708
|
|
Provision for income
tax expense
|
|
|
—
|
|
|
—
|
|
|
(28,485)
|
|
|
(28,485)
|
|
Net income and
comprehensive income
|
|
$
|
164,896
|
|
|
8,662
|
|
|
(93,335)
|
|
|
80,223
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
|
|
|
$
|
224,999
|
|
|
|
(1)
|
Certain expenses
that are not directly attributable to gathering and processing and
water handling are managed and evaluated on a consolidated
basis
|
ANTERO MIDSTREAM
CORPORATION
|
Condensed
Consolidated Statements of Cash Flows
|
(In
thousands)
|
(Unaudited)
|
|
|
|
Six Months Ended
June 30,
|
|
|
|
2020
|
|
2021
|
|
Cash flows provided
by (used in) operating activities:
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
|
(304,492)
|
|
|
163,664
|
|
Adjustments to
reconcile net income (loss) to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
Depreciation
|
|
|
55,088
|
|
|
53,469
|
|
Payment of contingent
consideration in excess of acquisition date fair value
|
|
|
(8,076)
|
|
|
—
|
|
Accretion of asset
retirement obligations
|
|
|
103
|
|
|
233
|
|
Impairment
|
|
|
664,544
|
|
|
1,379
|
|
Deferred income tax
expense (benefit)
|
|
|
(56,408)
|
|
|
56,509
|
|
Equity-based
compensation
|
|
|
6,035
|
|
|
7,071
|
|
Equity in earnings of
unconsolidated affiliates
|
|
|
(40,024)
|
|
|
(42,259)
|
|
Distributions from
unconsolidated affiliates
|
|
|
41,828
|
|
|
58,185
|
|
Amortization of
customer relationships
|
|
|
35,211
|
|
|
35,336
|
|
Amortization of
deferred financing costs
|
|
|
2,190
|
|
|
2,733
|
|
Loss on early
extinguishment of debt
|
|
|
—
|
|
|
20,701
|
|
Settlement of asset
retirement obligations
|
|
|
(601)
|
|
|
(602)
|
|
Loss on asset
sale
|
|
|
240
|
|
|
3,628
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
Accounts
receivable–Antero Resources
|
|
|
24,941
|
|
|
(16,274)
|
|
Accounts
receivable–third party
|
|
|
1,089
|
|
|
777
|
|
Income tax
receivable
|
|
|
(17,547)
|
|
|
16,311
|
|
Other current
assets
|
|
|
930
|
|
|
1,070
|
|
Accounts
payable–Antero Resources
|
|
|
(432)
|
|
|
376
|
|
Accounts payable–third
party
|
|
|
5,495
|
|
|
5,365
|
|
Accrued
liabilities
|
|
|
(21,701)
|
|
|
(7,297)
|
|
Net cash provided by
operating activities
|
|
|
388,413
|
|
|
360,375
|
|
Cash flows provided
by (used in) investing activities:
|
|
|
|
|
|
|
|
Additions to gathering
systems and facilities
|
|
|
(103,937)
|
|
|
(51,658)
|
|
Additions to water
handling systems
|
|
|
(19,477)
|
|
|
(22,707)
|
|
Investments in
unconsolidated affiliates
|
|
|
(21,988)
|
|
|
(966)
|
|
Cash received in asset
sale
|
|
|
123
|
|
|
1,627
|
|
Change in other
assets
|
|
|
1,938
|
|
|
—
|
|
Net cash used in
investing activities
|
|
|
(143,341)
|
|
|
(73,704)
|
|
Cash flows provided
by (used in) financing activities:
|
|
|
|
|
|
|
|
Dividends to
stockholders
|
|
|
(296,395)
|
|
|
(255,993)
|
|
Dividends to preferred
stockholders
|
|
|
(275)
|
|
|
(275)
|
|
Repurchases of common
stock
|
|
|
(24,713)
|
|
|
—
|
|
Issuance of senior
notes
|
|
|
—
|
|
|
750,000
|
|
Redemption of senior
notes
|
|
|
—
|
|
|
(667,472)
|
|
Payments of deferred
financing costs
|
|
|
—
|
|
|
(8,755)
|
|
Borrowings
(repayments) on bank credit facilities, net
|
|
|
195,500
|
|
|
(99,800)
|
|
Payment of contingent
acquisition consideration
|
|
|
(116,924)
|
|
|
—
|
|
Employee tax
withholding for settlement of equity compensation awards
|
|
|
(392)
|
|
|
(4,317)
|
|
Other
|
|
|
(111)
|
|
|
(21)
|
|
Net cash used in
financing activities
|
|
|
(243,310)
|
|
|
(286,633)
|
|
Net increase in cash
and cash equivalents
|
|
|
1,762
|
|
|
38
|
|
Cash and cash
equivalents, beginning of period
|
|
|
1,235
|
|
|
640
|
|
Cash and cash
equivalents, end of period
|
|
$
|
2,997
|
|
|
678
|
|
Supplemental
disclosure of cash flow information:
|
|
|
|
|
|
|
|
Cash paid during the
period for interest
|
|
$
|
74,665
|
|
|
91,608
|
|
Cash received during
the period for income taxes
|
|
$
|
38,910
|
|
|
16,913
|
|
Increase (decrease) in
accrued capital expenditures and accounts payable for property and
equipment
|
|
$
|
(3,461)
|
|
|
25,490
|
|
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SOURCE Antero Midstream Corporation