Legacy Reserves LP Announces Cash Distributions, 2015 Capital Budget and Year-End 2014 Conference Call
January 23 2015 - 9:00AM
Legacy Reserves LP ("Legacy") (Nasdaq:LGCY) today announced that
the Board of Directors of its general partner has approved a cash
distribution attributable to the fourth quarter of 2014 of $0.61
per unit, payable on February 13, 2015, to unitholders of record at
the close of business on February 2, 2015.
Legacy's general partner also declared a cash distribution for
both its 8% Series A Fixed-to-Floating Rate Cumulative Redeemable
Perpetual Preferred Units and its 8% Series B Fixed-to-Floating
Rate Cumulative Redeemable Perpetual Preferred Units of $0.166667
per unit payable on February 17, 2015 to preferred unitholders of
record on February 2, 2015.
The Board also approved a 2015 capital budget of $30 million as
compared to approximately $130 million in 2014. Cary D. Brown,
Chairman, President and Chief Executive Officer of Legacy's general
partner, commented: "The dramatic drop in oil and gas prices has
directly impacted our asset-level project returns. While we
have commodity hedges in place to insulate our near-term cash flow
at the partnership level, it simply does not make economic sense to
pursue new drilling projects in this market environment as they do
not generate a sufficient return for the company. We are
encouraged that our third-party service providers have already
begun to reduce prices, but we will need to see further reductions
prior to reinstating our prior capital spending levels.
"We also realize that if the current price environment is a
longer term cycle, we will not be able to continue to distribute to
our common unitholders at these levels. We have always taken a
long-term view on distributions and we do not believe the current
commodity outlook is sustainable. We have a strong balance sheet
and near-term hedges to mitigate against this dramatic downturn.
With our retail investors in mind, we believe it is best to
maintain our distribution level this quarter to give us more time
to assess our long-term distribution capabilities in a more
stabilized market. We appreciate our retail unitholders and believe
this strategy gives them time to plan around any possible reduction
in future distributions. We are hopeful that with good acquisitions
and some price improvement, a distribution reduction will not be
necessary. However, we remain committed to only distributing what
the assets allow over a longer-term period.
"We are thankful for our hard-working employees, long-lived and
low-decline asset base, protective commodity hedges, and incredibly
strong balance sheet that will help protect us this year. We are
hopeful that these difficult industry conditions can present the
kinds of unique and large-scale opportunities that we have
benefited from in our past. We look forward to sharing our thoughts
around our 2015 outlook at our upcoming year-end earnings
call."
Legacy will provide the details of its fourth quarter and 2014
operating and financial performance with its earnings report which
is scheduled to be released on Wednesday, February 25, 2015,
following the close of NASDAQ trading.
Earnings Conference Call
A teleconference and webcast will be held on Thursday, February
26, 2015, beginning at 9:00 a.m. Central Time. Those wishing to
participate in the conference call should dial 877-266-0479. A
replay of the call will be available through Thursday, March 5,
2015, by dialing 855-859-2056 or 404-537-3406 and entering replay
code 70464452. Those wishing to listen to the live or archived
webcast via the Internet should go to the Investor Relations tab of
our website at www.LegacyLP.com.
About Legacy Reserves LP
Legacy Reserves LP is a master limited partnership headquartered
in Midland, Texas, focused on the acquisition and development of
oil and natural gas properties primarily located in the Permian
Basin, Mid-Continent and Rocky Mountain regions of the United
States. Additional information is available at
www.LegacyLP.com.
Cautionary Statement Relevant to Forward-Looking
Information
This press release contains forward-looking statements relating
to our operations that are based on management's current
expectations, estimates and projections about its operations. Words
such as "anticipates," "expects," "intends," "plans," "targets,"
"projects," "believes," "seeks," "schedules," "estimated," and
similar expressions are intended to identify such forward-looking
statements. These statements are not guarantees of future
performance and are subject to certain risks, uncertainties and
other factors, some of which are beyond our control and are
difficult to predict. Among the important factors that could cause
actual results to differ materially from those in the
forward-looking statements are realized oil and natural gas prices;
production volumes, lease operating expenses, general and
administrative costs and finding and development costs; future
operating results and the factors set forth under the heading "Risk
Factors" in our annual and quarterly reports filed with the
Securities and Exchange Commission. Therefore, actual outcomes and
results may differ materially from what is expressed or forecasted
in such forward-looking statements. The reader should not place
undue reliance on these forward-looking statements, which speak
only as of the date of this press release. Unless legally required,
Legacy undertakes no obligation to update publicly any
forward-looking statements, whether as a result of new information,
future events or otherwise.
Withholding Information
This release is intended to be a qualified notice under Treasury
Regulation Section 1.1446-4(b). Brokers and nominees should treat
one hundred percent (100.0%) of Legacy's distributions to foreign
investors as being attributable to income that is effectively
connected with a United States trade or business. Accordingly,
Legacy's distributions to foreign investors are subject to federal
income tax withholding at the highest applicable rate.
CONTACT: Legacy Reserves LP
Dan Westcott
Executive Vice President and Chief Financial Officer
432-689-5200
Legacy Reserves Inc. (MM) (NASDAQ:LGCY)
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