Summit Midstream Partners, LP Reports Second Quarter 2014 Financial & Operating Results

    Summit Midstream Partners, LP Reports Second Quarter 2014 Financial &
                              Operating Results

PR Newswire

DALLAS, Aug. 7, 2014

DALLAS, Aug. 7, 2014 /PRNewswire/ --Summit Midstream Partners, LP (NYSE:
SMLP) today announced financial and operating results for the three and six
months ended June 30, 2014. SMLP reported adjusted EBITDA of $48.0 million
and adjusted distributable cash flow of $34.7 million for the second quarter
of 2014, an increase of 30.5% and 14.6%, respectively, over the second quarter
of 2013. SMLP reported $4.0 million of net income for the second quarter of
2014 compared to $8.8 million for the second quarter of 2013. Volume
throughput on SMLP's assets averaged 1,403 million cubic feet per day
("MMcf/d") in the second quarter of 2014, an increase of 32.4% over 1,060
MMcf/d in the second quarter of 2013.

Summit Midstream Partners Logo.

For the six months ended June 30, 2014, SMLP reported adjusted EBITDA of $94.6
million, an increase of $21.0 million, or 28.5%, over the comparable period in
2013. Adjusted distributable cash flow totaled $69.0 million for the first
six months of 2014, an increase of $6.3 million, or 10.1%, over the comparable
period in 2013. Net income totaled $10.4 million for the first six months of
2014 compared to $22.6 million in the comparable period in 2013. Volume
throughput averaged 1,356 MMcf/d for the six months ended June 30, 2014, an
increase of 26.1% over the comparable period in 2013.

Steve Newby, President and Chief Executive Officer of SMLP commented, "The
second quarter was another record quarter for Summit with volume throughput
averaging 1.4 Bcf/d, an increase of more than 32% over the second quarter of
2013. Importantly, each of our operating systems experienced sequential
quarterly volume growth led by the continued ramp up of our Mountaineer System
in the core of the Marcellus Shale. Our Red Rock system, which we acquired
from Summit Investments in the first quarter of 2014, is outperforming our
expectations. We are particularly encouraged by the level of producer
activity around our DFW Midstream system which we expect will drive additional
growth in the near term. Additionally, our team successfully resolved the
operating issues on our Bison Midstream system during the quarter, which
resulted in volume throughput growth of more than 26% over the first quarter
of 2014."

"Our strong second quarter financial results, together with our long-term
growth outlook, enabled us to deliver our seventh consecutive quarterly
distribution increase to unitholders, growing distributions per unit by 19.5%
over the second quarter of 2013 and 4.0% over the first quarter of 2014. Our
inventory of assets under development at Summit Investments continues to grow
with over $300 million of new Bakken Shale projects previously announced in
the second quarter of 2014. Given the strategic position of Summit
Investments' assets, which are located in some of the most attractive basins
in the United States, we expect to continue to generate new organic
development opportunities, which we believe will further enhance SMLP's
long-term growth visibility."

Financial and operating results for the six months ended June 30, 2014
benefitted from SMLP's June 2013 acquisition of Mountaineer Midstream Company,
LLC ("Mountaineer Midstream"), which was acquired from an affiliate of
MarkWest Energy Partners, L.P. ("MarkWest").

SMLP's financial and operating results retrospectively include financial and
operating results from Bison Midstream since February 16, 2013, and from the
Red Rock system since October 23, 2012, the date that each was originally
acquired by Summit Investments.

Volume throughput on the Mountaineer Midstream system averaged 366 MMcf/d in
the second quarter of 2014, up 28.1% over the first quarter of 2014 due to a
continuation of active drilling by our anchor customer, Antero Resources Corp.
("Antero"). We are currently in the process of expanding throughput capacity
on the Mountaineer Midstream system to 1,050 MMcf/d to support Antero's
current and future anticipated drilling activities. The revenues associated
with the incremental volume throughput will be driven by higher pressure
natural gas gathering services. Volumes are expected to continue to grow on
this system throughout the balance of 2014 as new Antero wells are connected
by third parties upstream of our system and as processing capacity at
MarkWest's Sherwood Processing Complex increases from 600 MMcf/d currently, to
1.4 billion cubic feet per day ("Bcf/d") by the third quarter of 2015.

Volume throughput on the Bison Midstream system averaged 15 MMcf/d in the
second quarter of 2014, up 26.2% over the first quarter of 2014, but down 8.1%
over the second quarter of 2013. Volume throughput on the Bison Midstream
system grew continuously during the second quarter of 2014 increasing from
approximately 14 MMcf/d in April to approximately 19 MMcf/d in June. The
extreme winter weather and operational issues that negatively impacted volume
throughput on the Bison Midstream system since the third quarter of 2013 were
resolved in the second quarter of 2014. We expect volume growth to continue
throughout the second half of 2014 as we continue to connect new pad sites and
expand the system's compression capacity. We currently have four compressor
expansion projects underway on the Bison Midstream system including the
construction of two new compressor stations to support producer activity.

Volume throughput on the DFW Midstream system averaged 350 MMcf/d in the
second quarter of 2014, up 0.6% from the first quarter of 2014, but down 11.5%
from the second quarter of 2013. This is the first time since the first
quarter of 2013 that DFW Midstream has experienced sequential quarterly volume
growth. Volume growth resulted from several customers bringing new wells
online early in the second quarter of 2014. The new incremental volume
throughput offset both the natural decline of existing wells on the system and
the continuation from several customers to temporarily shut-in pad sites to
drill or complete new wells. Given current drilling activity and producer
plans in our service area, DFW Midstream volume throughput is expected to
continue to increase throughout the second half of 2014.

In July 2014, SMLP executed an agreement with an affiliate of Energy Spectrum
Capital to acquire Texas Energy Midstream, L.P. ("TEM") for approximately
$11.0 million. TEM is a natural gas gathering system with approximately 13
MMcf/d of current throughput from two customers that are developing acreage in
Mansfield, TX, adjacent to the southern border of the DFW Midstream service
area. The acquisition is expected to close by the end of the third quarter of
2014.

Volume throughput on the Grand River system averaged 672 MMcf/d in the second
quarter of 2014, 1.4% over the first quarter of 2014, and 5.6% over the second
quarter of 2013. Volume throughput increased in the second quarter of 2014
primarily due to growing volumes from the Red Rock system, which was favorably
impacted by new pad site connections for WPX Energy, Inc., and Ursa Resources
Group II, and the March 2014 start-up of the 20 MMcf/d cryogenic processing
plant for Black Hills Corporation to process liquids-rich Mancos/Niobrara
gas. Volume throughput on the legacy Grand River system totaled 464 MMcf/d in
the second quarter of 2014, down 4.7% over the first quarter of 2014, and
resulted from our anchor customer, Encana Corp.'s, temporary suspension of
drilling activities in the Piceance Basin in 2014.

The Grand River system continues to benefit from its natural gas gathering
agreements, which include minimum volume commitments ("MVCs") that increase in
both rate and volume commitment over the next few years, and largely mitigate
the financial impact associated with declining volumes from certain
customers. Lower volume throughput from certain Grand River customers during
the second quarter of 2014 translated into larger MVC shortfall payments,
thereby minimizing the impact on adjusted EBITDA. 

                        Volume Throughput By System
                        QTD Period Ended June 30,   YTD Period Ended June 30,
(MMcf/d)                2014           2013         2014           2013
Average Daily
Throughput:
Mountaineer Midstream      366           12            326           6
^(1)
Bison Midstream ^(2)       15            17            14            13
DFW Midstream              350           395           349           407
Grand River ^(3)        672            636          667            649
Total Average Daily        1,403         1,060         1,356         1,075
Throughput:

(1) Mountaineer Midstream was acquired by SMLP on June 21, 2013. For the
    period of SMLP's ownership in 2013, average throughput was 120 MMcf/d.
    Bison Midstream was acquired from an affiliate of Summit Investments in
(2) June 2013 and includes results for all periods in which common control
    existed, beginning in February 2013.
    Includes Red Rock volume throughput. The Red Rock assets were acquired by
    Grand River Gathering from an affiliate of Summit Investment in March
(3) 2014, and the Grand River system includes the financial and operational
    results associated with the Red Rock assets for all periods during which
    common control existed, beginning in October 2012.

MVC Shortfall Payments
Adjusted EBITDA in the second quarter of 2014 was positively impacted by $12.9
million of adjustments associated with the MVC mechanisms in SMLP's gathering
agreements. Of the $12.9 million adjustment, $6.3 million was related to
changes in deferred revenue and $6.6 million was related to MVC shortfall
payment adjustments.

                       Three Months Ended June 30, 2014
                                      Gathering   Adjustments to   Net Impact
(In Millions)          MVC Billings   Revenue     MVC Shortfall    to Adjusted
                                                  Payments         EBITDA
Net Change in Deferred
Revenue:
Mountaineer Midstream  $   —          $  —        $    —           $  —
Bison Midstream        —              —           —                —
DFW Midstream          2.6            1.5         1.1              2.6
Grand River            3.7            —           3.7              3.7
Total                  $   6.3        $  1.5      $    4.8         $  6.3
MVC Shortfall Payment
Adjustments:
Mountaineer Midstream  $   0.5        $  0.5      $    —           $  0.5
Bison Midstream        —              —           2.6              2.6
DFW Midstream          0.1            0.1         (1.7)            (1.6)
Grand River            0.2            0.2         4.9              5.1
Total                  $   0.8        $  0.8      $    5.8         $  6.6
TOTAL                  $   7.1        $  2.3      $    10.6        $  12.9

SMLP billed its customers $7.1 million of MVC shortfall payments in the second
quarter of 2014 due to actual volume throughput that was lower than the
minimum volumes that those customers were contractually required to ship under
their gas gathering agreements. Of the MVC shortfall payments, $6.3 million
was recorded as deferred revenue on SMLP's balance sheet because these
customers have the ability to use these MVC shortfall payments to offset
gathering fees related to future throughput in excess of future period MVCs.
MVC shortfall payment adjustments in the second quarter of 2014 totaled $5.8
million and included adjustments related to future anticipated shortfall
payments from certain customers on the Grand River, Bison Midstream and DFW
Midstream systems.

Certain of our gas gathering agreements do not have credit banking mechanisms
and as such, the MVC shortfall payments from these customers are accounted for
as gathering revenue in the period that it is earned. For the second quarter
of 2014, we recognized $0.8 million of gathering revenue associated with MVC
shortfall payments from certain customers on the Mountaineer Midstream, DFW
Midstream and Grand River systems.

Capital Expenditures
For the three months ended June 30, 2014, SMLP recorded total capital
expenditures of $23.2 million, which included approximately $4.8 million of
maintenance capital expenditures. Development activities during the second
quarter of 2014 were related primarily to the construction of various pipeline
and compressor expansion projects across our gathering systems to facilitate
future expected volume throughput growth.

SMLP continued its development of the Zinnia Loop project during the second
quarter of 2014, which accounted for the majority of growth capex in the
second quarter of 2014. Activity is also underway to increase the number of
pad site connections and expand gathering capacity at Bison Midstream from 26
MMcf/d currently, to 32 MMcf/d by the end of the first quarter of 2015.

Capital & Liquidity
As of June 30, 2014, SMLP had total liquidity (cash plus undrawn borrowing
capacity under its $700.0 million revolving credit facility) of $297.4
million. Based upon the terms of SMLP's revolving credit facility and total
outstanding debt of $726.0 million, total leverage (net debt divided by
EBITDA) was approximately 3.9 to 1 as of June 30, 2014.

On July 15, 2014, SMLP's wholly owned subsidiary, Summit Midstream Holdings,
LLC, closed a $300.0 million offering of senior unsecured notes due in 2022,
which priced at par to yield 5.50%. The net proceeds from the senior notes
offering were used to repay borrowings under SMLP's $700.0 million revolving
credit facility. 

2014 SMLP Financial Guidance
SMLP is reaffirming its 2014 adjusted EBITDA guidance of $190.0 million to
$210.0 million. SMLP continues to expect to pay a distribution for the fourth
quarter of 2014 that is 15.0% to 20.0% over the $0.48 per unit distribution
paid for the fourth quarter of 2013. Given the pending TEM acquisition and
the decision to further expand compression capacity on the Bison Midstream
system, SMLP is increasing its 2014 capital expenditure guidance from $100.0
million to $115.0 million to $125.0 million to $135.0 million, including $15.0
to $20.0 million of maintenance capital expenditures.

SMLP's 2014 financial guidance excludes the effect of any other acquisitions
or potential drop down transactions from Summit Investments.

Quarterly Distribution
On July 24, 2014, the board of directors of SMLP's general partner declared a
quarterly cash distribution of $0.52 per unit on all outstanding common and
subordinated units, or $2.08 per unit on an annualized basis, for the quarter
ended June 30, 2014. This distribution will be paid on August 14, 2014 to
unitholders of record as of the close of business on August 7, 2014.

This is SMLP's seventh consecutive quarterly per unit distribution increase.
It represents an increase of $0.085 per unit, or 19.5%, over the distribution
paid for the second quarter of 2014 and an increase of $0.02 per unit, or
4.0%, over the distribution paid for the first quarter of 2014.

Second Quarter 2014 Earnings Call Information
SMLP will host a conference call at 10:00 a.m. Eastern on Friday, August 8,
2014, to discuss its quarterly operating and financial results. Interested
parties may participate in the call by dialing 847-619-6441 or toll-free
877-261-8990 and entering the passcode 37176450. The conference call will be
webcast live and can be accessed through the Investors section of SMLP's
website at www.summitmidstream.com.

A replay of the conference call will be available until August 22, 2014 at
11:59 p.m. Eastern, and can be accessed by dialing 888-843-7419 and entering
the replay passcode 37176450#. An archive of the conference call will also be
available on SMLP's website.

Summit Investments Sponsor Announcement
In June 2014, GE Energy Financial Services, Inc. ("GE-EFS") exchanged 100% of
its Class A membership interests in Summit Midstream Partners, LLC ("Summit
Investments"), the privately held company that indirectly owns a 56.7% limited
partner interest in SMLP and indirectly owns and controls the general partner
of SMLP, for a new class of membership interests, structured as Class C
preferred interests. As a result of this transaction, GE-EFS will no longer
participate as a Class A equity member at Summit Investments.

We refer to Energy Capital Partners and GE-EFS as our "Sponsors" for the
period from August 2011 until June 2014 and we refer to Energy Capital
Partners as our sole "Sponsor" for the period subsequent to this exchange
transaction.

Use of Non-GAAP Financial Measures
We report financial results in accordance with U.S. generally accepted
accounting principles ("GAAP"). We also present EBITDA, adjusted EBITDA,
distributable cash flow and adjusted distributable cash flow. We define EBITDA
as net income, plus interest expense, income tax expense, and depreciation and
amortization expense, less interest income and income tax benefit. We define
adjusted EBITDA as EBITDA plus unit-based compensation, adjustments related to
MVC shortfall payments and loss on asset sales, less gain on asset sales. We
define distributable cash flow as adjusted EBITDA plus cash interest income,
less cash paid for interest expense and income taxes, senior notes interest
and maintenance capital expenditures. We define adjusted distributable cash
flow as distributable cash flow plus or minus other non-cash or non-recurring
expenses or income. Our definitions of these non-GAAP financial measures may
differ from the definitions of similar measures used by other companies.
Management uses these non-GAAP financial measures in making financial,
operating and planning decisions and in evaluating our financial performance.
Furthermore, management believes that these non-GAAP financial measures may
provide users with additional meaningful comparisons between current results
and results of prior periods as they are expected to be reflective of our core
ongoing business. These measures have limitations, and investors should not
consider them in isolation or as a substitute for analysis of our results as
reported under GAAP. Reconciliations of GAAP to non-GAAP financial measures
are attached to this release.

About Summit Midstream Partners, LP
SMLP is a growth-oriented limited partnership focused on developing, owning
and operating midstream energy infrastructure assets that are strategically
located in the core producing areas of unconventional resource basins,
primarily shale formations, in North America. SMLP currently provides natural
gas gathering, treating and processing services pursuant to long-term,
primarily fee-based natural gas gathering and processing agreements with our
customers and counterparties in four unconventional resource basins: (i) the
Appalachian Basin, which includes the Marcellus Shale formation in northern
West Virginia; (ii) the Williston Basin, which includes the Bakken and Three
Forks shale formations in northwestern North Dakota; (iii) the Fort Worth
Basin, which includes the Barnett Shale formation in north-central Texas; and
(iv) the Piceance Basin, which includes the Mesaverde formation as well as the
Mancos and Niobrara shale formations in western Colorado and eastern Utah.
SMLP owns and operates more than 2,300 of pipeline and approximately 240,000
horsepower of compression. SMLP is headquartered in Dallas, TX with regional
corporate offices in Houston, TX, Denver, CO and Atlanta, GA.

About Summit Midstream Partners, LLC
Summit Midstream Partners, LLC ("Summit Investments") indirectly owns a 56.7%
limited partner interest in SMLP and indirectly owns and controls the general
partner of SMLP, Summit Midstream GP, LLC, which has sole responsibility for
conducting the business and managing the operations of SMLP. Summit
Investments owns, operates and is developing various crude oil, associated
natural gas, and water-related midstream energy infrastructure assets in the
Bakken Shale in North Dakota and in the DJ Niobrara Shale in Colorado. Summit
Investments is also developing natural gas gathering and condensate
stabilization infrastructure in the Utica Shale in southeastern Ohio under a
joint venture agreement with affiliates of MarkWest Energy Partners, L.P. and
The Energy & Minerals Group. Summit Investments is a privately held company
owned by members of management and funds controlled by Energy Capital Partners
II, LLC and certain of its affiliates.

Forward-Looking Statements
This press release includes certain statements concerning expectations for the
future that are forward-looking within the meaning of the federal securities
laws. Forward-looking statements contain known and unknown risks and
uncertainties (many of which are difficult to predict and beyond management's
control) that may cause SMLP's actual results in future periods to differ
materially from anticipated or projected results. An extensive list of
specific material risks and uncertainties affecting SMLP is contained in its
2013 Annual Report on Form 10-K as updated and superseded by our Current
Report on Form 8-K filed with the Securities and Exchange Commission on July
3, 2014 and as amended and updated from time to time. Any forward-looking
statements in this press release are made as of the date of this press release
and SMLP undertakes no obligation to update or revise any forward-looking
statements to reflect new information or events.



SUMMIT MIDSTREAM PARTNERS, LP AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
                                                   June 30,      December 31,

                                                   2014          2013
                                                   (In thousands)
Assets
Current assets:
Cash and cash equivalents                          $ 23,430      $  20,357
Accounts receivable                                53,345        67,877
Other assets                                       2,044         4,741
Total current assets                               78,819        92,975
Property, plant and equipment, net                 1,198,727     1,158,081
Intangible assets, net:
Favorable gas gathering contracts                  17,010        17,880
Contract intangibles                               367,146       383,306
Rights-of-way                                      101,923       100,991
Total intangible assets, net                       486,079       502,177
Goodwill                                           115,888       115,888
Other noncurrent assets                            13,621        14,618
Total assets                                       $ 1,893,134   $  1,883,739
Liabilities and Partners' Capital
Current liabilities:
Trade accounts payable                             $ 29,670      $  25,117
Due to affiliate                                   1,578         653
Deferred revenue                                   2,609         1,555
Ad valorem taxes payable                           6,883         8,375
Accrued interest                                   11,250        12,144
Other current liabilities                          9,943         11,729
Total current liabilities                          61,933        59,573
Long-term debt                                     726,000       586,000
Noncurrent liability, net                          5,955         6,374
Deferred revenue                                   37,093        29,683
Other noncurrent liabilities                       1,597         372
Total liabilities                                  832,578       682,002
Common limited partner capital                     702,298       566,532
Subordinated limited partner capital               332,389       379,287
General partner interests                          25,869        23,324
Summit Investments' equity in contributed          —             232,594
subsidiaries
Total partners' capital                            1,060,556     1,201,737
Total liabilities and partners' capital            $ 1,893,134   $  1,883,739



SUMMIT MIDSTREAM PARTNERS, LP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                        Three months ended June 30,  Six months ended June 30,
                        2014            2013         2014          2013
                        (In thousands, except per-unit and unit amounts)
Revenues:
Gathering services and  $   54,831      $  47,914    $   104,903   $  93,888
other fees
Natural gas, NGLs and
condensate sales and    26,190          23,797       52,546        40,088
other
 Amortization of
favorable and           (225)           (250)        (451)         (530)
unfavorable contracts
Total revenues          80,796          71,461       156,998       133,446
Costs and expenses:
Cost of natural gas and 16,378          13,438       31,660        21,403
NGLs
Operation and           19,859          18,371       39,040        35,950
maintenance
General and             8,690           8,406        16,576        14,973
administrative
Transaction costs       76              2,435        612           2,473
Depreciation and        20,480          16,801       40,122        30,714
amortization
Total costs and         65,483          59,451       128,010       105,513
expenses
Other (expense) income  (5)             1            (4)           2
Interest expense        (10,803)        (3,023)      (17,947)      (4,903)
Income before income    4,505           8,988        11,037        23,032
taxes
Income tax expense      (469)           (221)        (628)         (402)
Net income              $   4,036       $  8,767     $   10,409    $  22,630
Less: net income
attributable to Summit  —               699          2,828         2,082
Investments
Net income attributable 4,036           8,068        7,581         20,548
to SMLP
Less: net income
attributable to general 801             161          1,232         411
partner, including IDRs
Net income attributable $   3,235       $  7,907     $   6,349     $  20,137
to limited partners
Earnings per limited
partner unit:
Common unit – basic     $   0.05        $  0.16      $   0.14      $  0.41
Common unit – diluted   $   0.05        $  0.16      $   0.14      $  0.41
Subordinated unit –     $   0.05        $  0.16      $   0.08      $  0.41
basic and diluted
Weighted-average
limited partner units
outstanding:
Common unit – basic     34,422,273      25,172,087   32,179,431    24,790,158
Common unit – diluted   34,618,506      25,281,104   32,360,022    24,871,033
Subordinated unit –     24,409,850      24,409,850   24,409,850    24,409,850
basic and diluted



SUMMIT MIDSTREAM PARTNERS, LP AND SUBSIDIARIES

OTHER FINANCIAL AND OPERATING DATA
                            Three months ended June  Six months ended June 30,
                            30,
                            2014          2013       2014           2013
                            (Dollars in thousands)
Other financial data:
EBITDA (1)                  $           $        $            $  
                            36,012       29,061    69,555         59,177
Adjusted EBITDA (1)         47,956        36,750     94,575         73,623
Capital expenditures        23,236        21,345     63,336         49,642
Acquisition capital         —             458,914    305,000        458,914
expenditures (2)
Distributable cash flow     34,670        27,879     68,403         60,239
Adjusted distributable cash 34,746        30,314     69,015         62,712
flow
Distributions declared (3)  31,953        23,740     62,337         44,663
Distribution coverage ratio 1.09x         *          1.11x          *
(4)
Operating data:
Miles of pipeline (end of   2,324         2,232      2,324          2,232
period)
Aggregate average           1,403         1,060      1,356          1,075
throughput (MMcf/d)
* Not considered meaningful

(1) Includes transaction costs. These unusual and non-recurring expenses are
    settled in cash.
(2) Reflects cash paid and value of units issued, if any, to fund
    acquisitions.
    For the three months ended June 30, 2014, reflects quarterly cash
    distributions of $0.52 per unit in respect of the second quarter of 2014
    that will be paid August 14, 2014. For the three months ended June 30,
    2013, reflects quarterly cash distributions of $0.435 per unit in respect
    of the second quarter of 2013 that was paid August 14, 2013. For the six
(3) months ended June 30, 2014, reflects year-to-date quarterly cash
    distributions of $0.50 per unit in respect of the first quarter of 2014
    and $0.52 per unit in respect of the second quarter of 2014. For the six
    months ended June 30, 2013, reflects year-to-date quarterly cash
    distributions of $0.42 per unit in respect of the first quarter of 2013
    and $0.435 per unit in respect of the second quarter of 2013.
    Distribution coverage ratio calculation for the three months ended June
    30, 2014 is based on distributions in respect of the second quarter of
(4) 2014. Distribution coverage ratio calculation for the six months ended
    June 30, 2014 is based on distributions in respect of the first and second
    quarters of 2014.



SUMMIT MIDSTREAM PARTNERS, LP AND SUBSIDIARIES

UNAUDITED RECONCILIATIONS TO NON-GAAP FINANCIAL MEASURES
                        Three months ended June 30,  Six months ended June 30,
                        2014           2013          2014           2013
                        (Dollars in thousands)
Reconciliations of Net
Income to EBITDA,
Adjusted EBITDA,
Distributable Cash Flow
and Adjusted
Distributable Cash
Flow:
Net income (1)          $  4,036       $  8,767      $  10,409      $  22,630
Add:
Interest expense        10,803         3,023         17,947         4,903
Income tax expense      469            221           628            402
Depreciation and        20,480         16,801        40,122         30,714
amortization expense
Amortization of
favorable and           225            250           451            530
unfavorable contracts
(2)
Less:
Interest income         1              1             2              2
EBITDA (1)              $  36,012      $  29,061     $  69,555      $  59,177
Add:
Unit-based compensation 1,361          940           2,424          1,402
Adjustments related to
MVC shortfall payments  10,577         6,749         22,590         13,044
(3)
Loss on asset sales     6              —             6              —
Adjusted EBITDA (1)     $  47,956      $  36,750     $  94,575      $  73,623
Add:
Interest income         1              1             2              2
Less:
Cash interest paid      2,845          2,125         17,153         4,014
Senior notes interest   5,625          875           (875)          875
(4)
Cash taxes paid         —              660           —              660
Maintenance capital     4,817          5,212         9,896          7,837
expenditures
Distributable cash flow $  34,670      $  27,879     $  68,403      $  60,239
Add:
Transaction costs (1)   76             2,435         612            2,473
Adjusted distributable  $  34,746      $  30,314     $  69,015      $  62,712
cash flow
Distributions declared  $  31,953      $  23,740     $  62,337      $  44,663
(5)
Distribution coverage   1.09x          *             1.11x          *
ratio
* Not considered meaningful

(1) Includes transaction costs. These unusual and non-recurring expenses are
    settled in cash.
    The amortization of favorable and unfavorable contracts relates to gas
    gathering agreements that were deemed to be above or below market at the
(2) acquisition of the DFW Midstream system. We amortize these contracts on a
    units-of-production basis over the life of the applicable contract. The
    life of the contract is the period over which the contract is expected to
    contribute directly or indirectly to our future cash flows.
    Adjustments related to MVC shortfall payments account for (i) the net
(3) increases or decreases in deferred revenue for MVC shortfall payments and
    (ii) our inclusion of future expected annual MVC shortfall payments.
    Senior notes interest represents the net of interest expense accrued and
(4) paid during the period. Interest on the $300.0 million 7.5% senior notes
    due 2021 is paid in cash semi-annually in arrears on January 1 and July 1
    until maturity in July 2021.
    For the three months ended June 30, 2014, reflects quarterly cash
    distributions of $0.52 per unit in respect of the second quarter of 2014
    that will be paid August 14, 2014. For the three months ended June 30,
    2013, reflects quarterly cash distributions of $0.435 per unit in respect
    of the second quarter of 2013 that was paid August 14, 2013. For the six
(5) months ended June 30, 2014, reflects year-to-date quarterly cash
    distributions of $0.50 per unit in respect of the first quarter of 2014
    and $0.52 per unit in respect of the second quarter of 2014. For the six
    months ended June 30, 2013, reflects year-to-date quarterly cash
    distributions of $0.42 per unit in respect of the first quarter of 2013
    and $0.435 per unit in respect of the second quarter of 2013.



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SOURCE Summit Midstream Partners, LP

Website: http://www.summitmidstream.com
Contact: Marc Stratton, Vice President and Treasurer, 214-242-1966,
ir@summitmidstream.com
 
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