HOUSTON, May 7, 2018
/PRNewswire/ -- Oasis Midstream Partners LP (NYSE: OMP) (the
"Partnership" or "OMP") today announced financial results and cash
distribution for the quarter ended March 31,
2018 and provided an operational update.
Recent Highlights:
- Declared the quarterly cash distribution for the first quarter
of 2018 of $0.3925 per unit, a 4.7%
increase over the fourth quarter of 2017, in line with forecasted
20% annualized increase in cash distributions.
- Net income was $31.5 million for
the three months ended March 31, 2018
and net cash from operating activities was $74.8 million for the three months ended
March 31, 2018.
- Adjusted EBITDA was $38.2 million
for the three months ended March 31,
2018 and net Adjusted EBITDA to the Partnership was
$13.7 million for the three months
ended March 31, 2018. See "Non-GAAP
Financial Measures" below.
- Distributable Cash Flow was $11.9
million for the three months ended March 31, 2018, resulting in distribution
coverage of 1.11x, which was greater than guidance for the first
quarter of 1.10x. See "Non-GAAP Financial Measures" below.
"Oasis Midstream Partners started the year off strong,
continuing to grow volumes in our respective DevCos, which allows
for our continued support of strong coverage and keeps us on track
to meet our targeted 20% annual distribution per unit growth," said
Taylor Reid, Chief Executive Officer
of OMP. "OMP continues to grow volumes above and beyond our initial
forecast, which will allow for higher distributable cash flow and
higher distribution coverage over time. We have made significant
progress on our new 200 MMscfpd gas plant in Wild Basin, which
remains on time and on budget, and are looking at growing
throughput volumes via higher Oasis Petroleum volumes and volumes
from third parties. As wells get bigger and more rigs are returning
to work, there is a lot of activity in the core of the Williston
Basin, and OMP is uniquely positioned to capitalize on that
opportunity. We are beginning to see incremental third party
opportunities across all three of our DevCos, giving us further
comfort in our projected distribution growth. We continue to expect
fourth quarter 2018 coverage to exceed 1.2x and now expect the
first quarter of 2019 coverage to exceed 1.3x."
Other Key Developments:
- Realized improved natural gas processing volumes in Bighorn
DevCo totaling 98.0 million standard cubic feet per day ("MMscfpd")
during the three months ended March 31,
2018, an increase of 40% from the fourth quarter of
2017.
- Increased natural gas volumes in Bobcat DevCo to 140.4 MMscfpd
during the three months ended March 31,
2018, a 29% increase from the fourth quarter of 2017,
reflecting the early realization of improved growth opportunities
identified during the fourth quarter of 2017 due to increased gas
volumes in Wild Basin.
- Spent $35.4 million on Gas Plant
II in Bighorn DevCo, with the project approximately 65% complete
and on schedule to begin operations in late 2018.
- Spent $17.1 million on additional
gathering system infrastructure in Bobcat DevCo to capitalize on
additional growth opportunities identified due to increased natural
gas volumes and incremental oil and water in Wild Basin in the
first quarter of 2018. OMP anticipates natural gas volumes for
Bobcat DevCo to grow to 137 - 142 MMscfpd in 2018 and for natural
gas volumes to exceed 200 MMscfpd by mid 2019.
- Increased volumes in spite of a challenging North Dakota winter. OMP had higher operating
expenses related to difficult winter conditions. In addition,
OMP incurred incremental operating expenses related to equipment
and facility upgrades during the three months ended March 31, 2018 to mitigate the
impact of abnormally difficult conditions experienced
both this year and potentially in the future.
Operational and Financial Update
Select operational and financial statistics are in the following
table:
|
|
March 31,
2018
|
|
|
OMP
Ownership
|
|
Gross
|
|
Net
|
Bighorn
DevCo
|
|
|
|
(In
millions)
|
Operating
income
|
|
100
|
%
|
|
$
|
5.0
|
|
|
$
|
5.0
|
|
Depreciation and
amortization
|
|
100
|
%
|
|
2.5
|
|
|
2.5
|
|
Total
CapEx
|
|
100
|
%
|
|
42.2
|
|
|
42.2
|
|
Bobcat
DevCo
|
|
|
|
|
|
|
Operating
income
|
|
10
|
%
|
|
$
|
16.9
|
|
|
$
|
1.7
|
|
Depreciation and
amortization
|
|
10
|
%
|
|
2.1
|
|
|
0.2
|
|
Total
CapEx
|
|
10
|
%
|
|
27.8
|
|
|
2.8
|
|
Beartooth
DevCo
|
|
|
|
|
|
|
Operating
income
|
|
40
|
%
|
|
$
|
10.6
|
|
|
$
|
4.2
|
|
Depreciation and
amortization
|
|
40
|
%
|
|
1.7
|
|
|
0.7
|
|
Total
CapEx
|
|
40
|
%
|
|
11.2
|
|
|
4.5
|
|
Total
OMP
|
|
|
|
|
|
|
DevCo operating
income
|
|
|
|
$
|
32.5
|
|
|
$
|
10.9
|
|
Public company
expenses
|
|
|
|
0.7
|
|
|
0.7
|
|
OMP operating
income
|
|
|
|
31.8
|
|
|
10.2
|
|
Depreciation and
amortization
|
|
|
|
6.3
|
|
|
3.4
|
|
Equity-based
compensation expense
|
|
|
|
0.1
|
|
|
0.1
|
|
Total
CapEx
|
|
|
|
81.2
|
|
|
49.5
|
|
Maintenance
CapEx
|
|
|
|
2.3
|
|
|
0.8
|
|
Growth
CapEx
|
|
|
|
78.9
|
|
|
48.7
|
|
|
|
Metric
|
|
1Q18
Actual
|
|
2Q18
Guidance
|
|
FY18
Guidance
|
Bighorn
DevCo
|
|
|
|
|
|
|
|
|
Crude oil service
volumes
|
|
Mbopd
|
|
41.5
|
|
|
40 - 42
|
|
40 - 42
|
Natural gas service
volumes
|
|
MMscfpd
|
|
98.0
|
|
|
98 - 103
|
|
100 - 107
|
Bobcat
DevCo
|
|
|
|
|
|
|
|
|
Crude oil service
volumes
|
|
Mbopd
|
|
36.3
|
|
|
33 - 36
|
|
34 - 36
|
Natural gas service
volumes
|
|
MMscfpd
|
|
140.4
|
|
|
135 - 140
|
|
137 - 142
|
Water service
volumes
|
|
Mbowpd
|
|
43.0
|
|
|
43 - 47
|
|
46 - 50
|
Beartooth
DevCo
|
|
|
|
|
|
|
|
|
Water service
volumes
|
|
Mbowpd
|
|
108.4
|
|
|
107 - 112
|
|
107 - 112
|
Liquidity
As of March 31, 2018, OMP had cash
and cash equivalents of $4.0 million
and $117.0 million of borrowings
outstanding under its revolving credit facility with an unused
borrowing capacity of $83.0
million.
Quarterly Distribution
On February 26, 2018, the Partnership paid the initial
quarterly cash distribution to its unitholders of $0.0245 per unit related to the six days ended
September 30, 2017 and $0.3750 per unit related to the three months
ended December 31, 2017. The third quarter distribution was
prorated from the closing of the Partnership's initial public
offering on September 25, 2017. Both distributions equate to
the minimum quarterly distribution of $0.3750 per unit on
a full-quarter basis.
On May 7, 2018, the Board of Directors of OMP GP
LLC, the general partner of the Partnership, declared the quarterly
cash distribution of $0.3925 per unit
for the first quarter of 2018. The first quarter distribution
reflects a 4.7% increase over the fourth quarter of 2017, or 20%
annualized. The distribution will be payable on May 29,
2018 to unitholders of record as of May 17,
2018.
Qualified Notice
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 the Partnership's distributions to
non-U.S. investors as being attributable to income that is
effectively connected with a United
States trade or business. Accordingly, the
Partnership's distributions to non-U.S. investors are subject to
federal income tax withholding at the highest applicable effective
tax rate.
Conference Call Information
Investors, analysts and other interested parties are invited to
listen to the webcast and call:
Date:
|
|
Tuesday, May 8,
2018
|
Time:
|
|
11:30 a.m. Central
Time
|
Live
Webcast:
|
|
https://www.webcaster4.com/Webcast/Page/1777/25388
|
OR:
|
|
|
Dial-in:
|
|
888-317-6003
|
Intl. Dial
in:
|
|
412-317-6061
|
Conference ID:
|
|
6444678
|
Website:
|
|
www.oasismidstream.com
|
A recording of the conference call will be available beginning
at 1:30 p.m. Central Time on the day
of the call and will be available until Tuesday, May 15, 2018 by dialing:
Replay
dial-in:
|
|
877-344-7529
|
Intl.
replay:
|
|
412-317-0088
|
Replay
code:
|
|
10119292
|
The conference call will also be available for replay for
approximately 30 days at www.oasismidstream.com.
Contact:
Oasis Midstream Partners LP
Richard Robuck,
(281) 404-9602
CFO & SVP Finance
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. All
statements, other than statements of historical facts, included in
this press release that address activities, events or developments
that the Partnership expects, believes or anticipates will or may
occur in the future are forward-looking statements. Without
limiting the generality of the foregoing, forward-looking
statements contained in this press release specifically include the
expectations of plans, strategies, objectives and anticipated
financial and operating results of the Partnership, including the
Partnership's capital expenditure levels and other guidance
included in this press release. These statements are based on
certain assumptions made by the Partnership based on management's
experience and perception of historical trends, current conditions,
anticipated future developments and other factors believed to be
appropriate. Such statements are subject to a number of
assumptions, risks and uncertainties, many of which are beyond the
control of the Partnership, which may cause actual results to
differ materially from those implied or expressed by the
forward-looking statements. These include, but are not limited to,
the Partnership's ability to integrate acquisitions into its
existing business, changes in oil and natural gas prices, weather
and environmental conditions, the timing of planned capital
expenditures, availability of acquisitions, uncertainties in the
estimates of proved reserves and forecasted production results of
the Partnership's customers, operational factors affecting the
commencement or maintenance of producing wells, the condition of
the capital markets generally, as well as the Partnership's ability
to access them, the proximity to and capacity of transportation
facilities, and uncertainties regarding environmental regulations
or litigation and other legal or regulatory developments affecting
the Partnership's business and other important factors. Should one
or more of these risks or uncertainties occur, or should underlying
assumptions prove incorrect, the Partnership's actual results and
plans could differ materially from those expressed in any
forward-looking statements.
Any forward-looking statement speaks only as of the date on
which such statement is made and the Partnership undertakes no
obligation to correct or update any forward-looking statement,
whether as a result of new information, future events or otherwise,
except as required by applicable law.
About Oasis Midstream Partners LP
Oasis Midstream Partners LP is a growth-oriented, fee-based
master limited partnership formed by its sponsor, Oasis Petroleum
Inc. to own, develop, operate and acquire a diversified portfolio
of midstream assets in North
America that are integral to the oil and natural gas
operations of Oasis Petroleum Inc. and are strategically positioned
to capture volumes from other producers. For more information,
please visit the Partnership's website at
www.oasismidstream.com.
OASIS MIDSTREAM
PARTNERS LP
CONDENSED
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
|
|
|
March 31,
2018
|
|
December 31,
2017
|
|
(In thousands)
|
ASSETS
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
|
4,048
|
|
|
$
|
883
|
|
Accounts
receivable
|
920
|
|
|
834
|
|
Accounts
receivable from Oasis Petroleum
|
57,144
|
|
|
85,818
|
|
Prepaid
expenses
|
747
|
|
|
778
|
|
Total current
assets
|
62,859
|
|
|
88,313
|
|
Property, plant and
equipment
|
743,578
|
|
|
653,928
|
|
Less: accumulated
depreciation and amortization
|
(40,696)
|
|
|
(34,348)
|
|
Total property, plant
and equipment, net
|
702,882
|
|
|
619,580
|
|
Other
assets
|
1,899
|
|
|
2,013
|
|
Total
assets
|
$
|
767,640
|
|
|
$
|
709,906
|
|
LIABILITIES AND
EQUITY
|
|
|
|
Current
liabilities
|
|
|
|
Accounts
payable
|
$
|
593
|
|
|
$
|
—
|
|
Accounts payable to
Oasis Petroleum
|
15,533
|
|
|
11,638
|
|
Accrued
liabilities
|
67,239
|
|
|
58,818
|
|
Accrued interest
payable
|
73
|
|
|
114
|
|
Total current
liabilities
|
83,438
|
|
|
70,570
|
|
Long-term
debt
|
117,000
|
|
|
78,000
|
|
Asset retirement
obligations
|
1,332
|
|
|
1,316
|
|
Total
liabilities
|
201,770
|
|
|
149,886
|
|
Commitments and
contingencies
|
|
|
|
Partners'
Equity
|
|
|
|
Limited
Partner
|
|
|
|
Common units (13,774
units outstanding at March 31, 2018)
|
166,943
|
|
|
167,401
|
|
Subordinated units
(13,750 units outstanding at March 31, 2018)
|
78,657
|
|
|
79,173
|
|
General
Partner
|
—
|
|
|
—
|
|
Total partners'
equity
|
245,600
|
|
|
246,574
|
|
Non-controlling
interests
|
320,270
|
|
|
313,446
|
|
Total
equity
|
565,870
|
|
|
560,020
|
|
Total liabilities and
equity
|
$
|
767,640
|
|
|
$
|
709,906
|
|
OASIS MIDSTREAM
PARTNERS LP
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
|
|
|
Three Months Ended
March 31,
|
|
2018
|
|
2017
|
|
(In thousands, except per unit
data)
|
Revenues
|
|
|
|
Midstream services
for Oasis Petroleum
|
$
|
60,853
|
|
|
$
|
37,367
|
|
Midstream services
for third parties
|
568
|
|
|
273
|
|
Total
revenues
|
61,421
|
|
|
37,640
|
|
Operating
expenses
|
|
|
|
Direct
operating
|
17,116
|
|
|
9,023
|
|
Depreciation and
amortization
|
6,364
|
|
|
3,458
|
|
General and
administrative
|
6,150
|
|
|
4,396
|
|
Total operating
expenses
|
29,630
|
|
|
16,877
|
|
Operating
income
|
31,791
|
|
|
20,763
|
|
Other income
(expense)
|
|
|
|
Interest expense, net
of capitalized interest
|
(262)
|
|
|
(1,217)
|
|
Other income
(expense)
|
—
|
|
|
(2)
|
|
Total other income
(expense)
|
(262)
|
|
|
(1,219)
|
|
Income before income
taxes
|
31,529
|
|
|
19,544
|
|
Income tax
expense
|
—
|
|
|
(7,295)
|
|
Net
income
|
31,529
|
|
|
$
|
12,249
|
|
Less: Net income
attributable to non-controlling interests
|
21,575
|
|
|
|
Net income
attributable to Oasis Midstream Partners LP
|
$
|
9,954
|
|
|
|
Earnings per limited
partner unit — Basic and Diluted
|
|
|
|
Common
units
|
$
|
0.36
|
|
|
|
Subordinated
units
|
0.36
|
|
|
|
Weighted average
number of limited partner units outstanding — Basic
|
|
|
|
Common
units
|
13,750
|
|
|
|
Subordinated
units
|
13,750
|
|
|
|
Weighted average
number of limited partner units outstanding — Diluted
|
|
|
|
Common
units
|
13,754
|
|
|
|
Subordinated
units
|
13,750
|
|
|
|
Non-GAAP Financial Measures
Cash Interest
Cash Interest is a supplemental non-GAAP financial measure that
is used by management and external users of the Partnership's
financial statements, such as industry analysts, investors, lenders
and rating agencies. We define Cash Interest as interest expense
plus capitalized interest less amortization of deferred financing
costs included in interest expense. Cash Interest is not a measure
of interest expense as determined by United States generally accepted accounting
principles, or GAAP. Management believes that the presentation of
Cash Interest provides useful additional information to investors
and analysts for assessing the interest charges incurred on our
debt, excluding non-cash amortization, and our ability to maintain
compliance with our debt covenants.
The following table presents a reconciliation of the GAAP
financial measure of interest expense, net of capitalized interest,
to the non-GAAP financial measure of Cash Interest for the periods
presented:
|
Three Months Ended
March 31,
|
|
2018
|
|
2017
|
|
(In
thousands)
|
Interest expense,
net of capitalized interest
|
$
|
262
|
|
|
$
|
1,531
|
|
Capitalized
interest
|
835
|
|
|
289
|
|
Amortization of
deferred financing costs
|
(116)
|
|
|
—
|
|
Cash
Interest
|
$
|
981
|
|
|
$
|
1,820
|
|
Adjusted EBITDA
Adjusted EBITDA is a supplemental non-GAAP financial measure
that is used by management and external users of the Partnership's
financial statements, such as industry analysts, investors, lenders
and rating agencies. We define Adjusted EBITDA as earnings before
interest expense (net of capitalized interest), income taxes,
depreciation, amortization, equity-based compensation expenses and
other similar non-cash adjustments. Adjusted EBITDA should not be
considered an alternative to net income, net cash provided by
operating activities or any other measure of financial performance
or liquidity presented in accordance with GAAP. Management believes
that the presentation of Adjusted EBITDA provides information
useful to investors and analysts for assessing our results of
operations, financial performance and our ability to generate cash
from our business operations without regard to our financing
methods or capital structure, coupled with our ability to maintain
compliance with our debt covenants. The GAAP measures most directly
comparable to Adjusted EBITDA are net income and net cash provided
by operating activities, respectively.
Distributable Cash Flow ("DCF")
DCF is a supplemental non-GAAP financial measure that is used by
management and external users of the Partnership's financial
statements, such as industry analysts, investors, lenders and
rating agencies. We define DCF as Adjusted EBITDA attributable to
the Partnership less Cash Interest and maintenance capital
expenditures attributable to the Partnership. Maintenance capital
expenditures are cash expenditures (including expenditures for the
construction or development of new capital assets or the
replacement, improvement or expansion of existing capital assets)
made to maintain, over the long term, system operating capacity,
operating income or revenue. DCF should not be considered an
alternative to net income, net cash provided by operating
activities or any other measure of financial performance or
liquidity presented in accordance with GAAP. Management believes
that the presentation of DCF provides information useful to
investors and analysts for assessing our results of operations,
financial performance and our ability to generate cash from our
business operations without regard to our financing methods or
capital structure, coupled with our ability to make distributions
to our unitholders. The GAAP measures most directly comparable to
DCF are net income and net cash provided by operating activities,
respectively.
The following table presents reconciliations of the GAAP
financial measures of net income and net cash provided by operating
activities to the non-GAAP financial measure of Adjusted EBITDA and
DCF for the periods presented:
|
Three Months Ended
March 31,
|
|
2018
|
|
2017
|
|
(In
thousands)
|
Net
income
|
$
|
31,529
|
|
|
$
|
12,249
|
|
Income tax
expense
|
—
|
|
|
7,295
|
|
Depreciation and
amortization
|
6,364
|
|
|
3,458
|
|
Equity-based
compensation expense
|
63
|
|
|
348
|
|
Interest expense, net
of capitalized interest
|
262
|
|
|
1,217
|
|
Adjusted
EBITDA
|
38,218
|
|
|
$
|
24,567
|
|
Less: Adjusted EBITDA
attributable to non-controlling interests
|
24,496
|
|
|
|
Adjusted EBITDA
attributable to Oasis Midstream Partners LP
|
13,722
|
|
|
|
Cash Interest
attributable to Oasis Midstream Partners LP
|
981
|
|
|
|
Maintenance capital
expenditures
|
796
|
|
|
|
Distributable Cash
Flow attributable to Oasis Midstream Partners LP
|
$
|
11,945
|
|
|
|
|
|
|
|
Net cash provided
by operating activities
|
$
|
74,751
|
|
|
$
|
20,379
|
|
Current tax
expense
|
—
|
|
|
5,358
|
|
Interest expense, net
of capitalized interest
|
262
|
|
|
1,217
|
|
Changes in working
capital
|
(36,681)
|
|
|
(2,387)
|
|
Other non-cash
adjustments
|
(114)
|
|
|
—
|
|
Adjusted
EBITDA
|
38,218
|
|
|
$
|
24,567
|
|
Less: Adjusted EBITDA
attributable to non-controlling interests
|
24,496
|
|
|
|
Adjusted EBITDA
attributable to Oasis Midstream Partners LP
|
13,722
|
|
|
|
Cash Interest
attributable to Oasis Midstream Partners LP
|
981
|
|
|
|
Maintenance capital
expenditures
|
796
|
|
|
|
Distributable Cash
Flow attributable to Oasis Midstream Partners LP
|
$
|
11,945
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/oasis-midstream-partners-lp-announces-quarter-ended-march-31-2018-earnings-and-distribution-300644040.html
SOURCE Oasis Midstream Partners LP