Western Midstream Partners, Lp · NYSE:WES
Western Midstream Partners, Lp — Western Gas Partners — FY2016 Earnings Presentation
20 slides from Western Midstream Partners, Lp's earnings presentation, Feb 23, 2017
Slide 1: Fourth Quarter and Full Year 2016 Review
W E S T E R N G A S INVESTOR R E L AT ION S JON VANDENBRAND Director, Investor Relations (832) 636-1007 FOURTH QUARTER AND FULL YEAR 2016 REVIEW February 23, 2017 w w w. w e s t e r n g a s . c o m | N Y S E : W E S , W G P
Slide 2: Cautionary Language Regarding Forward Looking Statements
Cautionary Language Regarding Forward Looking Statements This presentation contains forward-looking statements. Western Gas Partners, LP and Western Gas Equity Partners, LP believe that their expectations are based on reasonable assumptions. No assurance, however, can be given that such expectations
Slide 3: Key Themes
Key Themes Achievement of Significant Scale Full-year 2016 Adjusted EBITDA of over $1 Billion Significant Delaware Basin Build-Out 2017 WES capital program will be largest in history Positioning for longer term performance Additional Financial Flexibility Full Conversion of Series A Preferre
Slide 4: Strong 2016 Performance
Strong 2016 Performance Original Updated 2016 ($ in Millions) Guidance1 Guidance2 Actual Adjusted EBITDA $860 - $950 $980 - $1,000 $1,028 Total Capex $450 - $490 $490 - $530 $486 Maintenance Capex as % of EBITDA 7% - 10% 6% - 8% 6% Coverage Ratio At least 1.1x NA 1.29x WES Distribution Growth 10% 10
Slide 5: 4Q16 vs 3Q16 Financial Performance
4Q16 vs 3Q16 Financial Performance ($ in Millions) 4Q16 3Q16 Adjusted EBITDA $268.4 $278.21 Total Capex $135.0 $93.0 Maintenance Capex $8.3 $15.3 Maintenance Capex as % of Adj. EBITDA 3% 6% Distributable Cash Flow $223.8 $237.31 Coverage Ratio 1.31x $1.42x 1) Includes Business Interruption insurance
Slide 6: 4Q16 vs 3Q16 Operational Performance
4Q16 vs 3Q16 Operational Performance ($ in Millions) 4Q16 3Q16 Key Drivers Natural Gas Throughput Hugoton divestiture; DJ and DBM 4.04 4.07 Growth offset by Marcellus decline (Bcf/d) Crude & NGL Throughput Growth at MB Fracs offset by 181 185 Springfield decline (MBbl/d) Adjusted Gross Margin for $0
Slide 7: DBJV/Marcellus Asset Swap
DBJV/Marcellus Asset Swap Acquisition of 50% interest in the assets of Delaware Basin JV Gathering System Asset swap with Williams Partners L.P. for: 33.75% Non-Operated Marcellus Interest and $155 million cash WES retains interest in system currently operated by Anadarko Expected to close in Ma
Slide 8: 2016 vs. 2017 Reconciliation
2016 vs. 2017 Reconciliation ($ in Millions) $32 $97 $1,050 $26 $1,028 $9 $9 2016 Adjusted DBJV/Marcellus Reclassification DBJV Hugoton Overall 2017 Adjusted EBITDA Asset Swap 1 of Mountain Gas Rate Reset 1 Divestiture Portfolio EBITDA Midpoint Fixed Price Growth Agreements 1 1) Projected 2017 Adjus
Slide 9: 2017 Major Projects & Capital Budget
2017 Major Projects & Capital Budget 2017E Capital: $900 Million to $1 Billion Focused on Delaware and DJ Basins Sanctioning of Mentone Trains I & II in Delaware Basin Delaware Basin Mentone I: 200 MMcf/d in-service in Q318 84% Mentone II: 200 MMcf/d in-service in Q418 Other 2% Assumes DBJV tran
Slide 10: High-Quality Dropdown Inventory
High-Quality Dropdown Inventory Current Inventory Extremely attractive locations Over 80% of cash flow from Delaware and DJ Basin DJ Basin assets DJ Basin Oil Gathering Significant anticipated growth Wattenberg Natural Buttes Gathering Plant $150 to $200 million of run-rate EBITDA same as Saddle
Slide 11: 2017 Outlook
2017 Outlook ($ in Millions) Full-Year 2017 WES Adjusted EBITDA $1,000 - $1,100 WES Total Capital Expenditures $900 - $1,000 WES Maintenance Capital Expenditures $60 - $80 WES 2017 & 2018 Annual Distribution Growth 7% - 9% WGP 2017 & 2018 Annual Distribution Growth 12% - 18% Increased financial flex
Slide 12: Appendix
Appendix w w w. w e s t e r n g a s . c o m | N Y S E : W E S , W G P W E S T E R N G A S 12
Slide 13: WES Non-GAAP Reconciliation
WES Non-GAAP Reconciliation “Adjusted EBITDA” WES defines Adjusted EBITDA as net income (loss) attributable to Western Gas Partners, LP, plus distributions from equity investees, non-cash equity-based compensation expense, interest expense, income tax expense, depreciation and amortization, impairme
Slide 14: WES Non-GAAP Reconciliation
WES Non-GAAP Reconciliation “Adjusted EBITDA” WES defines Adjusted EBITDA as net income (loss) attributable to Western Gas Partners, LP, plus distributions from equity investees, non-cash equity-based compensation expense, interest expense, income tax expense, depreciation and amortization, impairme
Slide 15: WES Non-GAAP Reconciliation
WES Non-GAAP Reconciliation “Distributable Cash Flow” WES defines Distributable cash flow as Adjusted EBITDA, plus interest income and the net settlement amounts from the sale and/or purchase of natural gas, condensate and NGLs under WES’s commodity price swap agreements to the extent such amounts a
Slide 16: WES Non-GAAP Reconciliation
WES Non-GAAP Reconciliation “Adjusted Gross Margin Attributable to Western Gas Partners, LP” WES defines Adjusted gross margin as total revenues and other, less cost of product and reimbursements for electricity-related expenses recorded as revenue, plus distributions from equity investments and exc
Slide 17: WES Non-GAAP Reconciliation
WES Non-GAAP Reconciliation “Adjusted EBITDA” WES defines Adjusted EBITDA as net income (loss) attributable to Western Gas Partners, LP, plus distributions from equity investees, non-cash equity-based compensation expense, interest expense, income tax expense, depreciation and amortization, impairme
Slide 18: WES Non-GAAP Reconciliation
WES Non-GAAP Reconciliation “Adjusted EBITDA” WES defines Adjusted EBITDA as net income (loss) attributable to Western Gas Partners, LP, plus distributions from equity investees, non-cash equity-based compensation expense, interest expense, income tax expense, depreciation and amortization, impairme
Slide 19: WES Non-GAAP Reconciliation
WES Non-GAAP Reconciliation “Distributable Cash Flow” WES defines Distributable cash flow as Adjusted EBITDA, plus interest income and the net settlement amounts from the sale and/or purchase of natural gas, condensate and NGLs under WES’s commodity price swap agreements to the extent such amounts a
Slide 20: WES Non-GAAP Reconciliation
WES Non-GAAP Reconciliation “Adjusted Gross Margin Attributable to Western Gas Partners, LP” WES defines Adjusted gross margin as total revenues and other, less cost of product and reimbursements for electricity-related expenses recorded as revenue, plus distributions from equity investments and exc