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|Sanchez Production Partners Reports Fourth Quarter and Full Year 2016 Financial Results|
"The Carnero Gathering Pipeline, which went into service in 2016, currently delivers natural gas volumes for
"Our prospects for growth have improved considerably with Sanchez Energy's acquisition of the
"With these assets, we have successfully transformed the Partnership to a midstream-focused master limited partnership and, in the process, have significantly reduced our commodity price exposure. Consistent with this strategy, the Partnership continues to explore the possible divestiture of its remaining oil and natural gas wells, leases and associated assets and interests in Oklahoma and Kansas."
OPERATING AND FINANCIAL RESULTS
Operating expenses during the fourth quarter 2016 totaled
On a GAAP basis, the Partnership recorded a net loss of
Adjusted EBITDA (a non-GAAP financial measure) for the fourth quarter 2016 was approximately
Based on Adjusted EBITDA of
CONFERENCE CALL INFORMATION
To participate in the conference call, analysts, investors, media and the public in the U.S. may dial (844) 824-3837 shortly before
A live audio webcast of the conference call and the earnings release will be available on the Partnership's website (www.sanchezpp.com) under the Investor Relations page. A replay will be available approximately one hour after the call through March 31, 2017, at 10:59 p.m. Central Time (
ABOUT THE PARTNERSHIP
The Partnership anticipates that it will file its Form 10-K with the
Adjusted EBITDA is a non-GAAP financial measure that is defined as net income (loss) adjusted by (i) interest (income) expense, net, which includes interest expense, interest expense net (gain) loss on interest rate derivative contracts, and interest (income); (ii) income tax expense (benefit); (iii) depreciation, depletion and amortization; (iv) asset impairments; (v) accretion expense; (vi) (gain) loss on sale of assets; (vii) unit-based compensation programs; (viii) unit-based asset management fees; (ix) distributions in excess of equity earnings; (x) (gain) loss on mark-to-market activities; (xi) commodity derivatives settlements applied to future positions; and (xii) (gain) loss on embedded derivatives. For a reconciliation of Adjusted EBITDA to Net Income (Loss), the most directly comparable GAAP measure, see the tables at the end of this release.
Adjusted EBITDA is a significant performance metric used by our management to indicate (prior to the establishment of any cash reserves by the board of directors of our general partner) the distributions that we would expect to pay to our unitholders. Specifically, this financial measure indicates to investors whether or not we are generating cash flow at a level that can sustain or support a quarterly distribution or any increase in our quarterly distribution rates. Adjusted EBITDA is also used as a quantitative standard by our management and by external users of our financial statements such as investors, research analysts, our lenders and others to assess: (i) the financial performance of our assets without regard to financing methods, capital structure or historical cost basis; (ii) the ability of our assets to generate cash sufficient to pay interest costs and support our indebtedness; and (iii) our operating performance and return on capital as compared to those of other companies in our industry, without regard to financing or capital structure. We believe that the presentation of Adjusted EBITDA provides useful information to investors in assessing our financial condition and results of operations. The GAAP measure most directly comparable to Adjusted EBITDA is net income. Our non-GAAP financial measure of Adjusted EBITDA should not be considered as an alternative to GAAP net income. Adjusted EBITDA has important limitations as an analytical tool because it excludes some but not all items that affect net income. Adjusted EBITDA should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Because Adjusted EBITDA may be defined differently by other companies in our industry, our definition of Adjusted EBITDA may not be comparable to similarly titled measures of other companies, thereby diminishing its utility.
The forward-looking statements contained in this press release are largely based on our expectations, which reflect estimates and assumptions made by our management. These estimates and assumptions reflect our best judgment based on currently known market conditions and other factors. Although we believe such estimates and assumptions to be reasonable, they are inherently uncertain and involve a number of risks and uncertainties that are beyond our control. In addition, management's assumptions about future events may prove to be inaccurate. Management cautions all readers that the forward-looking statements contained in this press release are not guarantees of future performance, and we cannot assure any reader that such statements will be realized or the forward-looking events and circumstances will occur. Actual results may differ materially from those anticipated or implied in the forward-looking statements due to factors listed in the "Risk Factors" section in our filings with the