- 3Q 2015 Adjusted EBITDA is $1.1
Billion, Up 21% Primarily on Major Fee-Based Projects
- Record Distributable Cash Flow of $754
Million – More than Double 3Q 2014 – Coverage Ratio of 1.04x
- Fee-Based Revenues Up $204 Million or
18% on Contributions from New Major Projects, Access Midstream
Growth
Williams Partners L.P. (NYSE: WPZ) today reported third quarter
2015 adjusted EBITDA of $1.1 billion, a $193 million, or 21
percent, increase from third quarter 2014.
The increase in adjusted EBITDA for third quarter 2015 is due to
increases of $143 million from the Atlantic-Gulf segment, $63
million from NGL & Petchem Services, $29 million from Access
Midstream and $19 million from the Northeast G&P segment.
Partially offsetting these increases was a $63 million decrease in
the West due to lower NGL margins.
Summary Financial Information 3Q
YTD Amounts in millions, except coverage ratio amounts. All
income amounts attributable to Williams Partners L.P. 2015
2014 2015 2014 (Unaudited)
Williams
Partners Adjusted EBITDA (1) $ 1,100 $ 907 $ 3,025 $ 2,392 DCF
attributable to partnership operations (1) $ 754 $ 367 $ 2,101 $
1,453 Cash distribution coverage ratio (1) (2) 1.04x .63x .97x .84x
Net income (loss) (3) ($194 ) $ 233 $ 195 $ 806 (1) Adjusted
EBITDA, distributable cash flow (DCF) and cash distribution
coverage ratio are non-GAAP measures. Financial information for
periods prior to July 1, 2014 represents Williams Partners L.P. on
a basis that is prior to the merger with Access Midstream Partners,
L.P. DCF and cash distribution coverage ratio for the 2014 periods
reflect amounts previously reported for Williams Partners L.P. for
those periods prior to the merger. Reconciliations to the most
relevant measures included in GAAP are attached to this news
release. (2) Cash distribution coverage ratios for the third
quarter and year-to-date 2015 periods exclude the benefit of $209
million of IDR waivers associated with the WPZ merger termination
fee. The 2015 cash distribution coverage ratios, including the
benefit of the $209 million IDR waiver during third quarter 2015,
are 1.47x and 1.07x for the third quarter and year-to-date 2015
periods, respectively. (3) Amounts reported for the 2015
periods reflect impairment charges totaling $477 million associated
with certain equity-method investments previously recorded at fair
value in conjunction with the Access merger.
The increase in adjusted EBITDA in third quarter 2015 as
described above by segment was driven by $204 million, or 18
percent, higher fee-based revenues and minimum volume commitments
compared with third quarter 2014. Olefins margins increased $58
million reflecting production at the expanded Geismar plant in
third quarter 2015 at multi-year low per unit ethylene margins,
partially offset by lower margins from our Canadian operations.
Additionally, the proportional EBITDA from non-consolidated equity
investments increased $52 million for third quarter 2015 versus
third quarter 2014, due primarily to Discovery’s Keathley Canyon
Connector project in the Atlantic-Gulf operating area.
Partially offsetting these increases were $68 million in lower
NGL margins due primarily to NGL prices that remain at a 10-year
low, as well as $51 million higher operating and general and
administrative expenses versus third quarter 2014 primarily
reflecting higher costs associated with our growing businesses.
Year-to-date 2015, Williams Partners reported adjusted EBITDA of
$3.025 billion, a $633 million, or 26 percent, increase from the
same period last year. The year-to-date increase in adjusted EBITDA
was primarily driven by contributions from the Access Midstream
merger for periods following July 1, 2014, as well as fee-based
revenue growth in other operating areas.
Williams Partners reported unaudited third quarter 2015 net loss
attributable to controlling interests of $194 million compared with
income of $233 million in third quarter 2014. The unfavorable
change was driven by $477 million of impairments in 2015 associated
with certain equity-method investments, as well as declines in NGL
margins and higher operating, depreciation and interest expenses.
The impairment charges primarily relate to our investment in the
Delaware basin gas gathering system, which were driven by an
increase in the discount rate utilized in our estimation of the
fair value of the investment at September 30, 2015. Higher
fee-based revenues and increased olefins margins partially offset
these unfavorable changes.
Year-to-date net income was $195 million, compared with $806
million year-to-date 2014. The year-to-date decrease in net income
was driven primarily by the same factors described above, as well
as higher general and administrative costs.
Distributable Cash Flow & Distributions
For third quarter 2015, Williams Partners generated $754 million
in distributable cash flow (DCF) attributable to partnership
operations, compared with $367 million in DCF attributable to
partnership operations in third quarter 2014. The $387 million
increase in DCF for the quarter was driven by the Access Midstream
acquisition and other increases in adjusted EBITDA, partially
offset by higher interest expense. DCF for 2014 reflects pre-merger
Williams Partners.
Year-to-date 2015, Williams Partners generated $2.1 billion in
DCF attributable to partnership operations, compared with $1.45
billion in DCF attributable to partnership operations for the same
period last year. The $648 million increase in DCF for the
nine-month period ended Sept. 30 was driven by the Access Midstream
acquisition and other increases in adjusted EBITDA, partially
offset by higher interest expense.
CEO Perspective
Alan Armstrong, chief executive officer of Williams Partners’
general partner, made the following comments:
“Our strong third quarter results underscore the effectiveness
of our strategy to connect the best natural gas supplies to the
best markets with fee-based infrastructure, which accounted for
more than 90 percent of our gross margin. Williams Partners
achieved record distributable cash flow and delivered adjusted
EBITDA growth across four of the partnership’s five operating
areas.
“In September, we completed Transco’s Virginia Southside
Expansion and we’re on track to place into full service the Leidy
Southeast Expansion by the end of the year, helping relieve supply
bottlenecks in the Northeast and creating more fee-based revenue.
Supply development in the Northeast will continue to be hampered
until constraints are addressed. Fortunately, Williams Partners and
other industry participants are hard at work implementing projects
that will solve this problem.
“We recognize the fundamental pressures impacting our direct
commodity margins and volume growth on our gathering and processing
systems. However, our unique position and backlog of fully
contracted, demand-driven projects will drive our continued
operating cash flow growth.”
Business Segment Performance
Williams Partners Adjusted EBITDA Amounts in
millions
3Q 2015 3Q 2014 YTD
2015 YTD 2014 Access Midstream (1) $ 351 $ 322 $
1,010 $ 322 Atlantic-Gulf 414 271 1,138 807 NGL & Petchem
Services (2) 85 22 125 426 Northeast G&P 87 68 279 198 West 161
224 473 641 Other
2 -
- (2 ) Total
$ 1,100 $ 907
$ 3,025 $ 2,392
Schedules reconciling adjusted EBITDA to modified
EBITDA and net income are attached to this news release. (1)
First and second quarter 2014 represents pre-merger Williams
Partners and excludes Access Midstream. (2) The first and
second quarters of 2014 include $173 million and $138 million,
respectively, in assumed business interruption insurance proceeds
related to the 2013 incident at the Geismar plant.
Access Midstream Segment
Access Midstream provides gathering, treating, and compression
services to producers under long term, fee-based contracts in
Pennsylvania, West Virginia, Ohio, Louisiana, Texas, Arkansas,
Oklahoma and Kansas. Access Midstream also includes a non-operated
50 percent interest in the Delaware Basin gas gathering system in
the Mid-Continent region and a 62 percent interest in Utica East
Ohio Midstream LLC, a joint project to develop infrastructure for
the gathering, processing and fractionation of natural gas and NGLs
in the Utica Shale play in Eastern Ohio. Additionally, Access
Midstream operates 100 percent of and owns an approximate average
45 percent interest in 11 natural gas gathering systems in the
Marcellus Shale region.
Access Midstream reported adjusted EBITDA of $351 million for
third quarter 2015, compared with $322 million of adjusted EBITDA
in third quarter 2014. The increase in adjusted EBITDA between
years was driven by higher fee-based volumes, minimum volume
commitments and the increased ownership interest in the Utica East
Ohio Midstream joint venture.
Year-to-date 2015, Access Midstream segment reported adjusted
EBITDA of $1.01 billion, compared with $322 million previously
reported for the same period last year. Williams Partners’ results
for first and second quarter 2014 are on a pre-merger basis and
exclude Access Midstream.
Atlantic-Gulf Segment
Atlantic-Gulf includes the Transco interstate gas pipeline and a
41-percent interest in the Constitution interstate gas pipeline
development project, which Williams Partners consolidates. The
segment also includes the partnership’s significant natural gas
gathering and processing and crude production handling and
transportation in the Gulf Coast region. These operations include a
51-percent interest in Gulfstar One, a 50-percent interest in
Gulfstream and a 60-percent interest in the Discovery pipeline and
processing system.
Atlantic-Gulf reported adjusted EBITDA of $414 million for third
quarter 2015, compared with $271 million for third quarter 2014.
The increase was due primarily to $113 million higher fee-based
revenues from both Gulfstar One and Transco expansion projects, as
well as $35 million higher proportional adjusted EBITDA primarily
from Discovery driven by the Keathley Canyon Connector project,
partially offset by lower NGL margins.
Year-to-date 2015, Atlantic-Gulf reported adjusted EBITDA of
$1.14 billion, compared with $807 million for the same period last
year. The year-to-date results were driven primarily by the same
factors that drove the quarterly results.
NGL & Petchem Services Segment
NGL & Petchem Services includes an 88.5 percent interest in
an olefins production facility in Geismar, La., along with a
refinery grade propylene splitter and pipelines in the Gulf Coast
region. This segment also includes midstream operations in Alberta,
Canada, including an oil sands offgas processing plant near Fort
McMurray, 260 miles of NGL and olefins pipelines and an NGL/olefins
fractionation facility and butylene/butane splitter facility at
Redwater. This segment also includes the partnership’s energy
commodities marketing business, an NGL fractionator and storage
facilities near Conway, Kan. and a 50-percent interest in Overland
Pass Pipeline.
NGL & Petchem Services reported adjusted EBITDA of $85
million for third quarter 2015, compared with $22 million for third
quarter 2014. Geismar operated at expected production levels and
contributed approximately $71 million of olefins margins for third
quarter 2015, partially offset by $19 million in lower
commodity-related margins at the Canadian operations.
Year-to-date 2015, NGL & Petchem Services reported adjusted
EBITDA of $125 million, compared with $426 million for the same
period last year. Year-to-date 2014 results include approximately
$311 million in assumed business interruption insurance proceeds
related to the 2013 incident at the Geismar plant. In addition to
the absence of the assumed business interruption insurance
proceeds, the year-to-date results were also driven by the same
factors that drove the quarterly results.
Northeast G&P Segment
Northeast G&P includes the partnership’s midstream gathering
and processing business in the Marcellus and Utica shale regions,
including Susquehanna Supply Hub and Ohio Valley Midstream, as well
as its 69-percent equity investment in Laurel Mountain Midstream,
and its 58.4-percent equity investment in Caiman Energy II. Caiman
Energy II owns a 50 percent interest in Blue Racer Midstream.
Northeast G&P reported adjusted EBITDA of $87 million for
third quarter 2015, compared with $68 million for third quarter
2014. The improved results are due primarily to a $25 million
increase in fee-based revenues driven primarily by higher volumes
and incremental new services at Ohio Valley Midstream, as well as
$11 million higher proportional EBITDA from equity investments.
These gains were partially offset by $15 million in higher
operating expenses associated with growth and operational repairs
in the Northeast.
Year-to-date 2015, Northeast G&P reported adjusted EBITDA of
$279 million, compared with $198 million for the same period last
year. The year-to-date results were driven primarily by the same
factors that drove the quarterly results.
West Segment
West includes the partnership’s Northwest Pipeline interstate
gas pipeline system, as well as gathering, processing and treating
operations in Wyoming, the Piceance Basin and the Four Corners
area.
West reported adjusted EBITDA of $161 million for third quarter
2015, compared with $224 million for third quarter 2014. Lower
adjusted EBITDA for the quarter was due primarily to $52 million
lower NGL margins from lower NGL prices that remain at 10-year
lows.
Year-to-date 2015, West reported adjusted EBITDA of $473
million, compared with $641 million for the same period last year.
Lower adjusted EBITDA for the year-to-date period was due primarily
to nearly $123 million lower NGL margins and $37 million higher
operating and maintenance expenses driven by the addition of the
Niobrara operations from the Access Midstream merger and various
increases in other operating expenses.
Other
Williams Partners recently announced a regular quarterly cash
distribution of $0.85 per unit for its common unitholders. As
announced on Sept. 28 in connection with the proposed business
combination transaction between Williams and Energy Transfer
Equity, L.P., Williams and Williams Partners withdrew previous
financial guidance and adopted a policy of no longer providing
financial guidance.
Third-Quarter Materials to be Posted Shortly, Live Webcast
Scheduled for Tomorrow
Williams Partners’ third-quarter 2015 financial results will be
posted shortly at www.williams.com. The information will include
the data book and analyst package.
Williams Partners and Williams will jointly host a conference
call and live webcast on Thursday, Oct. 29, at 9 a.m. EDT. A
limited number of phone lines will be available at (800) 505-9568.
International callers should dial (416) 505-9568. A link to the
webcast, as well as replays of the webcast in both streaming and
downloadable podcast formats, will be available following the event
at www.williams.com.
Form 10-Q
The partnership plans to file its third-quarter 2015 Form 10-Q
with the Securities and Exchange Commission this week. Once filed,
the document will be available on both the SEC and Williams
Partners websites.
Definitions of Non-GAAP Financial Measures
This news release may include certain financial measures –
adjusted EBITDA, distributable cash flow and cash distribution
coverage ratio – that are non-GAAP financial measures as defined
under the rules of the Securities and Exchange Commission.
Our segment performance measure, modified EBITDA, is defined as
net income (loss) before income tax expense, net interest expense,
equity earnings from equity-method investments, other net investing
income, impairments of equity investments, depreciation and
amortization expense, and accretion expense associated with asset
retirement obligations for nonregulated operations. We also add our
proportional ownership share (based on ownership interest) of
modified EBITDA of equity investments.
Adjusted EBITDA further excludes items of income or loss that we
characterize as unrepresentative of our ongoing operations and may
include assumed business interruption insurance related to the
Geismar plant. Management believes these measures provide investors
meaningful insight into results from ongoing operations.
We define distributable cash flow as adjusted EBITDA less
maintenance capital expenditures, cash portion of interest expense,
income attributable to noncontrolling interests and cash income
taxes, plus WPZ restricted stock unit non-cash compensation expense
and certain other adjustments that management believes affects the
comparability of results. Adjustments for maintenance capital
expenditures and cash portion of interest expense include our
proportionate share of these items of our equity-method
investments.
We also calculate the ratio of distributable cash flow to the
total cash distributed (cash distribution coverage ratio). This
measure reflects the amount of distributable cash flow relative to
our cash distribution. We have also provided this ratio calculated
using the most directly comparable GAAP measure, net income.
This news release is accompanied by a reconciliation of these
non-GAAP financial measures to their nearest GAAP financial
measures. Management uses these financial measures because they are
accepted financial indicators used by investors to compare company
performance. In addition, management believes that these measures
provide investors an enhanced perspective of the operating
performance of the Partnership's assets and the cash that the
business is generating.
Neither adjusted EBITDA nor distributable cash flow are intended
to represent cash flows for the period, nor are they presented as
an alternative to net income or cash flow from operations. They
should not be considered in isolation or as substitutes for a
measure of performance prepared in accordance with United States
generally accepted accounting principles.
About Williams Partners
Williams Partners (NYSE: WPZ) is an industry-leading, large-cap
natural gas infrastructure master limited partnership with a strong
growth outlook and major positions in key U.S. supply basins and
also in Canada. Williams Partners has operations across the natural
gas value chain from gathering, processing and interstate
transportation of natural gas and natural gas liquids to petchem
production of ethylene, propylene and other olefins. Williams
Partners owns and operates more than 33,000 miles of pipelines
system wide – including the nation’s largest volume and fastest
growing pipeline – providing natural gas for clean-power
generation, heating and industrial use. Williams Partners’
operations touch approximately 30 percent of U.S. natural gas.
Tulsa, Okla.-based Williams (NYSE: WMB), a premier provider of
large-scale North American natural gas infrastructure, owns 60
percent of Williams Partners, including all of the 2 percent
general-partner interest. www.williams.com
Forward-Looking Statements
The reports, filings, and other public announcements of Williams
Partners L.P. (WPZ) may contain or incorporate by reference
statements that do not directly or exclusively relate to historical
facts. Such statements are “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of
1934, as amended. We make these forward-looking statements in
reliance on the safe harbor protections provided under the Private
Securities Litigation Reform Act of 1995.
Forward-looking statements can be identified by various forms of
words such as “anticipates,” “believes,” “seeks,” “could,” “may,”
“should,” “continues,” “estimates,” “expects,” “forecasts,”
“intends,” “might,” “goals,” “objectives,” “targets,” “planned,”
“potential,” “projects,” “scheduled,” “will,” “assumes,”
“guidance,” “outlook,” “in service date” or other similar
expressions. These forward-looking statements are based on
management’s beliefs and assumptions and on information currently
available to management and include, among others, statements
regarding:
- The status, expected timing and
expected outcome of the proposed ETC Merger;
- Events which may occur subsequent to
the proposed ETC Merger including events which directly impact our
business;
- Expected levels of cash distributions
with respect to general partner interests, incentive distribution
rights and limited partner interests;
- Our and our affiliates’ future credit
ratings;
- Amounts and nature of future capital
expenditures;
- Expansion and growth of our business
and operations;
- Financial condition and liquidity;
- Business strategy;
- Cash flow from operations or results of
operations;
- Seasonality of certain business
components;
- Natural gas, natural gas liquids, and
olefins prices, supply, and demand; and
- Demand for our services.
Forward-looking statements are based on numerous assumptions,
uncertainties and risks that could cause future events or results
to be materially different from those stated or implied in this
document. Many of the factors that will determine these results are
beyond our ability to control or predict. Specific factors that
could cause actual results to differ from results contemplated by
the forward-looking statements include, among others, the
following:
- The timing and likelihood of completion
of the proposed ETC Merger, including the satisfaction of
conditions to the completion of the proposed ETC Merger;
- Energy Transfer’s plans for us, as well
as the other master limited partnerships it currently controls,
following the completion of the proposed ETC Merger;
- Disruption from the proposed ETC Merger
making it more difficult to maintain business and operational
relationships;
- Whether we have sufficient cash from
operations to enable us to pay current and expected levels of cash
distributions, if any, following the establishment of cash reserves
and payment of fees and expenses, including payments to our general
partner;
- Availability of supplies, market demand
and volatility of prices;
- Inflation, interest rates, fluctuation
in foreign exchange rates and general economic conditions
(including future disruptions and volatility in the global credit
markets and the impact of these events on customers and
suppliers);
- The strength and financial resources of
our competitors and the effects of competition;
- Whether we are able to successfully
identify, evaluate and execute investment opportunities;
- Our ability to acquire new businesses
and assets and successfully integrate those operations and assets
into our existing businesses as well as successfully expand our
facilities;
- Development of alternative energy
sources;
- The impact of operational and
developmental hazards and unforeseen interruptions;
- Costs of, changes in, or the results of
laws, government regulations (including safety and environmental
regulations), environmental liabilities, litigation, and rate
proceedings;
- Williams’ costs and funding obligations
for defined benefit pension plans and other postretirement benefit
plans;
- Our allocated costs for defined benefit
pension plans and other postretirement benefit plans sponsored by
our affiliates;
- Changes in maintenance and construction
costs;
- Changes in the current geopolitical
situation;
- Our exposure to the credit risk of our
customers and counterparties;
- Risks related to financing, including
restrictions stemming from debt agreements, future changes in
credit ratings as determined by nationally-recognized credit rating
agencies and the availability and cost of capital;
- The amount of cash distributions from
and capital requirements of our investments and joint ventures in
which we participate;
- Risks associated with weather and
natural phenomena, including climate conditions;
- Acts of terrorism, including
cybersecurity threats and related disruptions; and
- Additional risks described in our
filings with the Securities and Exchange Commission (SEC).
Given the uncertainties and risk factors that could cause our
actual results to differ materially from those contained in any
forward-looking statement, we caution investors not to unduly rely
on our forward-looking statements. We disclaim any obligations to
and do not intend to update the above list or announce publicly the
result of any revisions to any of the forward-looking statements to
reflect future events or developments.
In addition to causing our actual results to differ, the factors
listed above and referred to below may cause our intentions to
change from those statements of intention set forth in this
document. Such changes in our intentions may also cause our results
to differ. We may change our intentions, at any time and without
notice, based upon changes in such factors, our assumptions, or
otherwise.
Because forward-looking statements involve risks and
uncertainties, we caution that there are important factors, in
addition to those listed above, that may cause actual results to
differ materially from those contained in the forward-looking
statements. For a detailed discussion of those factors, see Part I,
Item 1A. Risk Factors in our Annual Report on Form 10-K filed with
the SEC on February 25, 2015 and in Part II, Item 1A. Risk Factors
in our Quarterly Report on Form 10-Q available from our office or
from our website at www.williams.com.
Williams Partners L.P. Reconciliation of
Non-GAAP Measures
(UNAUDITED)
2014 2015 (Dollars in millions, except
coverage ratios) 1st Qtr 2nd Qtr 3rd
Qtr 4th Qtr Year 1st Qtr 2nd Qtr 3rd
Qtr Year
Williams Partners L.P.
Reconciliation of GAAP "Net Income" to
Non-GAAP "Modified EBITDA," "Adjusted EBITDA," and "Distributable
cash flow”
Net income $ 352 $ 223 $ 247 $ 462 $ 1,284 $ 112 $ 332 $
(167 ) $ 277 Provision (benefit) for income taxes 8 5 10 6 29 3 — 1
4 Interest expense 106 126 154 176 562 192 203 205 600 Equity
(earnings) losses (23 ) (32 ) (85 ) (88 ) (228 ) (51 ) (93 ) (92 )
(236 ) Impairment of equity-method investments — — — — — — — 461
461 Other investing (income) loss — (1 ) — (1 ) (2 ) (1 ) — — (1 )
Proportional Modified EBITDA of equity-method investments 54 62 150
165 431 136 183 185 504 Depreciation and amortization expenses 208
207 364 372 1,151 419 419 423 1,261 Accretion for asset retirement
obligations associated with nonregulated operations 3
6 3 5
17 7
9 5 21
Modified EBITDA 708 596 843 1,097 3,244 817 1,053 1,021 2,891
Adjustments Estimated minimum volume commitments — — 47 (114
) (67 ) 55 55 65 175 Acquisition-related expenses — 2 13 1 16 — — —
— Merger and transition related expenses — — 11 30 41 32 14 2 48
Share of impairment at equity-method investment — — — — — 8 1 17 26
Geismar Incident adjustment for insurance and timing 54 96 — (71 )
79 — (126 ) — (126 ) Loss related to Geismar Incident — — 5 5 10 1
1 — 2 Impairment of certain assets — 17 — 35 52 3 24 2 29
Contingency loss (gain), net of legal costs — — — (143 ) (143 ) — —
— — Net gain related to partial acreage dedication release — — (12
) — (12 ) — — — — Loss related to compressor station fire 6 — — — 6
— — — — Loss (recovery) related to Opal incident — 6 — 2 8 1 — (8 )
(7 ) Loss on sale of equipment — — — 7 7 — — — — Gain on
extinguishment of debt — — — — — — (14 ) — (14 ) Proposed WMB/WPZ
merger expenses — —
— — —
— — 1
1 Total EBITDA adjustments 60
121 64 (248
) (3 ) 100 (45 )
79 134 Adjusted EBITDA $ 768
$ 717 $ 907 $ 849
$ 3,241 917 1,008 1,100 3,025 Maintenance
capital expenditures (1) (54 ) (80 ) (114 ) (248 ) Interest expense
(cash portion) (2) (204 ) (207 ) (219 ) (630 ) Cash taxes (1 ) — —
(1 ) Income attributable to noncontrolling interests (23 ) (32 )
(27 ) (82 ) WPZ restricted stock unit non-cash compensation 7 6 7
20 Plymouth incident adjustment 4 6
7 17
Distributable cash flow attributable to Partnership Operations
646 701 754
2,101 Total cash distributed (3) $ 725
$ 723 $ 723 $ 2,171
Coverage ratios: Distributable
cash flow attributable to partnership operations divided by Total
cash distributed 0.89 0.97
1.04 0.97 Net
income divided by Total cash distributed 0.15
0.46 (0.23 ) 0.13
Notes: (1) Includes proportionate share of maintenance capital
expenditures of equity investments. (2) Includes proportionate
share of interest expense of equity investments.
(3) Cash distributions for the third
quarter and year-to-date periods have been increased by $209
million in order to exclude the impact of the IDR waiver associated
with the WPZ merger termination fee from the determination of
coverage ratios.
Williams Partners L.P. Reconciliation of
Non-GAAP “Modified EBITDA” to Non-GAAP “Adjusted EBITDA”
(UNAUDITED) 2014 2015 (Dollars in millions)
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
Year 1st Qtr 2nd Qtr 3rd Qtr Year
Modified EBITDA: Access
Midstream $ — $ (2 ) $ 254 $ 390 $ 642 $ 228 $ 273 $ 268 $ 769
Northeast G&P 48 59 80 208 395 90 70 84 244 Atlantic-Gulf 266
270 271 258 1,065 335 389 414 1,138 West 212 199 224 188 823 161
150 169 480 NGL & Petchem Services 182 72 17 53 324 6 158 85
249 Other — (2 ) (3 )
— (5 ) (3 ) 13
1 11
Total
Modified EBITDA $ 708 $ 596
$ 843 $
1,097 $ 3,244 $
817 $ 1,053
$ 1,021 $ 2,891
Adjustments:
Access
Midstream
ACMP Acquisition-related expenses $ — $ 2 $ 13 $ 1 $ 16 $ — — — —
ACMP Merger and transition costs — — 8 29 37 30 14 2 46 Loss on
sale of equipment — — — 7 7 — — —
— Impairment of certain assets — — — 12 12 1 3 — 4 Estimated
minimum volume commitments — — 47 (114 ) (67 ) 55 55 65 175 Share
of impairment at equity-method investment — —
— —
— — — 16
16 Total Access Midstream adjustments —
2 68 (65 ) 5 86 72 83 241
Northeast
G&P
Share of impairment at equity-method investment — — — — — 8 1 1
10
Contingency gain, net of legal costs — — — (143 ) (143 ) — — —
— Loss related to compressor station fire 6 — — — 6 — — — — Net
gain related to partial acreage dedication release — — (12 ) — (12
) — — — — Impairment of certain assets — 17
— 13
30 2 21 2
25 Total Northeast G&P adjustments
6 17 (12 ) (130 ) (119 ) 10 22 3 35
Atlantic-Gulf
Impairment of certain assets — —
— 10 10
— — —
— Total Atlantic-Gulf adjustments — — — 10 10 — — — —
West
Loss (recovery) related to Opal incident — 6
— 2
8 1 — (8 )
(7 ) Total West adjustments — 6 — 2 8 1 — (8 ) (7 )
NGL & Petchem
Services
Loss related to Geismar Incident — — 5 5 10 1 1 — 2 Geismar
Incident adjustment for insurance and timing 54
96 — (71 )
79 — (126 )
— (126 ) Total NGL & Petchem Services
adjustments 54 96 5 (66 ) 89 1 (125 ) — (124 )
Other
ACMP Merger-related expenses — — 3 1 4 2 — — 2 Proposed WMB/WPZ
Merger expenses — — — — — — — 1 1 Gain on extinguishment of debt
— — —
— — —
(14 ) — (14 ) Total Other
adjustments — — 3 1 4 2 (14 ) 1 (11 )
Total Adjustments $ 60
$ 121 $ 64
$ (248 ) $ (3
) $ 100 $ (45
) $ 79 $
134 Adjusted EBITDA: Access Midstream $
— $ — $ 322 $ 325 $ 647 $ 314 $ 345 $ 351 $ 1,010 Northeast G&P
54 76 68 78 276 100 92 87 279 Atlantic-Gulf 266 270 271 268 1,075
335 389 414 1,138 West 212 205 224 190 831 162 150 161 473 NGL
& Petchem Services 236 168 22 (13 ) 413 7 33 85 125 Other
— (2 ) — 1
(1 ) (1 ) (1 )
2 —
Total Adjusted EBITDA
$ 768 $ 717
$ 907 $ 849
$ 3,241 $ 917
$ 1,008 $ 1,100
$ 3,025
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version on businesswire.com: http://www.businesswire.com/news/home/20151028006505/en/
Williams Partners L.P.Media Contact:Tom Droege,
918-573-4034orInvestor Contacts:John Porter,
918-573-0797orBrett Krieg, 918-573-4614
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