Management to Host Conference Call Today at 9 a.m. CT
KANSAS CITY, Mo.--(BUSINESS WIRE)--Jan. 31, 2012--
Inergy Midstream, L.P. (NYSE:NRGM) (“Inergy Midstream”) today reported
results of operations for the quarter ended December 31, 2011, the first
quarter of fiscal 2012.
Inergy Midstream reported Adjusted EBITDA of $25.7 million for the
quarter ended December 31, 2011, an increase of $7.3 million, or
approximately 39.7%, from $18.4 million for the quarter ended December
31, 2010. Net income was $14.4 million for the quarter ended December
31, 2011, and $9.0 million in the same quarter of last year.
“Our results for the quarter were as expected,” said John Sherman,
President and CEO of Inergy Midstream. “We are excited to execute our
strategy on behalf of our new unitholders. With a strong balance sheet
and a pipeline of high-return growth projects, we are well positioned to
increase cash earnings and create value for our investors.”
As previously announced, the Board of Directors of Inergy Midstream’s
general partner declared a prorated cash distribution of $0.04 per
limited partner unit for the quarter ended December 31, 2011. The $0.04
cash distribution per limited partner unit corresponds to an initial
quarterly cash distribution of $0.37 per quarter ($1.48 annually) and
represents the prorated distribution for the period of time from
December 21, 2011, the closing of Inergy Midstream’s initial public
offering, through December 31, 2011, the end of its first fiscal
quarter. The distribution will be paid on February 14, 2012, to
unitholders of record as of February 7, 2012.
Quarterly Results
In the quarter ended December 31, 2011, revenues from firm storage
increased to $23.8 million compared to $22.0 million during the same
three-month period in 2010. Revenues from transportation increased to
$6.5 million for the three months ended December 31, 2011, compared to
$3.0 million during the same three-month period in 2010. Revenues from
hub services increased to $3.4 million for the three months ended
December 31, 2011, compared to $0.9 million during the same three-month
period in 2010.
In the quarter ended December 31, 2011, storage related costs decreased
to $1.9 million compared to $2.1 million during the same three-month
period in 2010. Transportation-related costs were $1.7 million for the
three months ended December 31, 2011 and 2010.
For the quarter ended December 31, 2011, operating and administrative
expenses were $5.2 million compared to $4.0 million in the same period
of fiscal 2011.
Inergy Midstream will host a live conference call and internet webcast
on January 31, 2012, at 9:00 a.m. Central Time to discuss the results of
operations for the quarter ended December 31, 2011, and its business
outlook. The call-in number for the earnings call is 1-888-595-3894, and
the conference name is Inergy Midstream. The live internet webcast and
the replay can be accessed on Inergy Midstream's website, www.inergylp.com.
A digital recording of the call will be available for one week following
the call by dialing 1-855-859-2056 and entering the pass code 46673488.
Inergy Midstream’s Initial Public Offering
Inergy Midstream’s initial public offering (“IPO”) of its common units
representing limited partner interests closed on December 21, 2011.
Inergy Midstream offered 16,000,000 common units and the underwriters
exercised their option to purchase an additional 2,400,000 common units.
Prior to this offering, there had been no public market for Inergy
Midstream’s common units. Inergy Midstream’s common units began trading
on the New York Stock Exchange on December 16, 2011, under the symbol
“NRGM.” Inergy, L.P. (“Inergy”) owns 75.2% of the outstanding limited
partnership units, the incentive distribution rights, and the managing
general partner of Inergy Midstream.
On December 21, 2011, Inergy Midstream entered into a new $500 million
revolving credit facility (“Credit Facility”) with a December 2016
maturity date. The Credit Facility is available to fund working capital
and internal growth projects, to make acquisitions, and for general
partnership purposes. Inergy Midstream borrowed $80 million under its
Credit Facility to fund a cash distribution to Inergy for reimbursement
of capital expenditures associated with its assets. Inergy Midstream’s
Credit Facility has an accordion feature that allows Inergy Midstream to
increase the available borrowings under the facility by up to $250
million, subject to obtaining additional lender commitments and the
satisfaction of certain other conditions.
About Inergy Midstream, L.P.
Inergy Midstream, L.P., headquartered in Kansas City, Missouri, is a
master limited partnership engaged in the development and operation of
natural gas and NGL storage and transportation assets. Our assets are
located in the Northeast region of the United States.
About Inergy, L.P.
Inergy, L.P., headquartered in Kansas City, Missouri, is a publicly
traded master limited partnership. Inergy’s operations include the
retail marketing, sale, and distribution of propane to residential,
commercial, industrial, and agricultural customers from customer service
centers throughout the United States. The company also operates a
natural gas storage business in Texas and an NGL supply logistics,
transportation, and wholesale marketing business that serves customers
in the United States and Canada. Through its general partner interest
and majority equity ownership interest in Inergy Midstream, L.P., Inergy
is also engaged in the development and operation of natural gas and NGL
storage and transportation business in the Northeast region of the
United States.
Corporate news, unit prices, and additional information about Inergy
Midstream, including reports from the United States Securities and
Exchange Commission, are available on the company’s website, www.inergylp.com.
For more information, contact Mike Campbell in Inergy Midstream’s
Investor Relations Department at 816-842-8181 or via e-mail at investorrelations@inergyservices.com.
We define EBITDA as income before income taxes plus net interest expense
and depreciation and amortization expense. We define Adjusted EBITDA as
EBITDA excluding the gain or loss on the disposal of assets, long-term
incentive and equity compensation expense, and transaction costs.
Transaction costs are third-party professional fees and other costs that
are incurred in conjunction with closing a transaction.
Adjusted EBITDA is a non-GAAP supplemental financial measure that
management and external users of our financial statements, such as
industry analysts, investors, lenders, and rating agencies, may use to
assess:
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our operating performance as compared to other publicly traded
partnerships in the midstream energy industry, without regard to
historical cost basis or financing methods;
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the ability of our assets to generate sufficient cash flow to make
distributions to our common unitholders;
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our ability to incur and service debt and fund capital expenditures;
and
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the viability of acquisitions and other capital expenditure projects
and the returns on investment in various opportunities.
EBITDA and Adjusted EBITDA should not be considered an alternative to
net income, income before income taxes, cash flows from operating
activities, or any other measure of financial performance calculated in
accordance with GAAP, as those items are used to measure operating
performance, liquidity, and our ability to service debt obligations. We
believe that EBITDA provides additional information for evaluating our
ability to make distributions to our common unitholders and is presented
solely as a supplemental measure. We believe that Adjusted EBITDA
provides additional information for evaluating our financial performance
without regard to our financing methods, capital structure, and
historical cost basis. One should not consider Adjusted EBITDA in
isolation or as a substitute for analysis of our results as reported
under GAAP. EBITDA and Adjusted EBITDA, as we define them, may not be
comparable to EBITDA and Adjusted EBITDA or similarly titled measures
used by other corporations or partnerships in our industry, thereby
diminishing such measures’ utility.
This press release contains forward-looking statements, which are
statements that are not historical in nature. Forward-looking statements
are subject to certain risks, uncertainties, and assumptions. Should one
or more of these risks or uncertainties materialize or any underlying
assumption proves incorrect, actual results may vary materially from
those anticipated, estimated, or projected. Among the key factors that
could cause actual results to differ materially from those referred to
in the forward-looking statements are: changes in general and local
economic conditions; competitive conditions within our industry; our
ability to complete internal growth projects on time and on budget; the
price and availability of debt and equity financing; the effects of
existing and future governmental legislation and regulations; and
natural disasters, weather-related delays, casualty losses, and other
matters beyond our control. These and other risks and assumptions are
described in Inergy Midstream’s prospectus dated December 15, 2011,
filed with the United States Securities and Exchange Commission in
accordance with Rule 424(b) of the Securities Act on December 16, 2011.
Readers are cautioned not to place undue reliance on forward-looking
statements, which reflect management’s view only as of the date made. We
undertake no obligation to update any forward-looking statement, except
as otherwise required by law.
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Inergy Midstream, L.P. (Formerly Inergy Midstream LLC)
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Consolidated Statements of Operations
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For the Three Months Ended December 31, 2011 and 2010
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(in millions, except unit and per unit data)
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Three Months Ended
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December 31,
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2011
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2010
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(Unaudited)
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Revenue:
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Firm storage
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$
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21.8
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$
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21.8
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Transportation
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6.5
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3.0
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Hub services
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3.4
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0.9
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Related party firm storage
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2.0
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0.2
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33.7
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25.9
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Costs and expenses:
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Storage related costs
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1.9
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2.1
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Transportation related costs
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1.7
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1.7
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Operating and administrative
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5.2
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4.0
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Depreciation and amortization
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10.5
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9.1
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19.3
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16.9
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Net income
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$
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14.4
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$
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9.0
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Less: Net income prior to initial public offering of Inergy
Midstream, L.P.
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14.2
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Total limited partners’ interest in net income
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$
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0.2
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Net income per limited partner unit:
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Basic
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$
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0.00
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Diluted
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$
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0.00
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Weighted-average limited partners units outstanding (in thousands):
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Basic
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74,331
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Diluted
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74,331
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Three Months Ended
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December 31,
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2011
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2010
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(Unaudited)
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Supplemental Information:
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Cash and cash equivalents
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$
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0.1
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$
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-
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Outstanding debt:
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Credit facility (d)
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$
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80.2
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$
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-
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Total partner’s capital
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$
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640.8
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$
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553.3
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EBITDA:
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Net income
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$
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14.4
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$
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9.0
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Depreciation and amortization
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10.5
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9.1
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EBITDA (a)
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$
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24.9
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$
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18.1
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Long-term incentive and equity compensation expense
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0.8
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0.3
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Adjusted EBITDA (a)
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$
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25.7
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$
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18.4
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Distributable cash flow:
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Adjusted EBITDA (a)
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$
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25.7
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$
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18.4
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Maintenance capital expenditures (b)
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(0.4
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-
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Distributable cash flow (c)
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$
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25.3
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$
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18.4
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EBITDA:
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Net cash provided by operating activities
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$
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24.1
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$
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22.4
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Net changes in working capital balances
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0.8
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(4.3
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EBITDA
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$
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24.9
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$
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18.1
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Long-term incentive and equity compensation expense
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0.8
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0.3
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Adjusted EBITDA
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$
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25.7
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$
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18.4
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(a)
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EBITDA is defined as income (loss) before income taxes plus net
interest expense and depreciation and amortization expense. As
indicated in the table, Adjusted EBITDA represents EBITDA excluding
the gain or loss on the disposal of assets, long-term incentive and
equity compensation expenses, and transaction costs. Transaction
costs are third party professional fees and other costs that are
incurred in conjunction with closing a transaction. EBITDA and
Adjusted EBITDA should not be considered an alternative to net
income, income before income taxes, cash flows from operating
activities, or any other measure of financial performance calculated
in accordance with generally accepted accounting principles as those
items are used to measure operating performance, liquidity, and our
ability to service debt obligations. We believe that EBITDA provides
additional information for evaluating our ability to make
distributions to our common unitholders and is presented solely as a
supplemental measure. We believe that Adjusted EBITDA provides
additional information for evaluating our financial performance
without regard to our financing methods, capital structure, and
historical cost basis. EBITDA and Adjusted EBITDA, as we define
them, may not be comparable to EBITDA and Adjusted EBITDA or
similarly titled measures used by other corporations or partnerships.
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(b)
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Maintenance capital expenditures are defined as those capital
expenditures which do not increase operating capacity or revenues
from existing levels.
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(c)
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Distributable cash flow is defined as Adjusted EBITDA, less cash
interest expense, maintenance capital expenditures, and income
taxes. Distributable cash flow should not be considered an
alternative to cash flows from operating activities or any other
measure of financial performance calculated in accordance with
generally accepted accounting principles as those items are used to
measure operating performance, liquidity or the ability to service
debt obligations. We believe that distributable cash flow provides
additional information for evaluating our ability to declare and pay
distributions to unitholders. Distributable cash flow, as we define
it, may not be comparable to distributable cash flow or similarly
titled measures used by other corporations and partnerships.
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(d)
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On December 21, 2011, Inergy Midstream entered into a new $500
million revolving credit facility (“Credit Facility”) with a
December 2016 maturity date. The Credit Facility is available to
fund working capital and internal growth projects, to make
acquisitions, and for general partnership purposes. Inergy Midstream
borrowed $80 million under its Credit Facility to fund a cash
distribution to Inergy for reimbursement of capital expenditures
associated with its assets. In addition, Inergy Midstream borrowed
approximately $6.8 million and made $6.6 million in payments on the
Credit Facility.
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Source: Inergy Midstream, L.P.
Inergy Midstream, L.P.
Mike Campbell, 816-842-8181
investorrelations@inergyservices.com
