DENVER--(BUSINESS WIRE)--American Midstream Partners, LP (NYSE: AMID) today announced a quarterly distribution and preliminary expectations for 2014 financial performance.
The Board of Directors of the Partnership’s general partner declared a quarterly cash distribution of $0.4725 per common unit, or $1.89 per unit on an annualized basis. The fourth quarter 2014 distribution is unchanged compared to the distribution for the third quarter 2014 and represents an increase of $0.02 per unit, or 4.4 percent, compared to the distribution for the fourth quarter 2013. Distributions for full-year 2014 increased approximately 6 percent compared to full-year 2013.
The distribution will be paid February 13, 2015, to unitholders of record as of the close of business February 6, 2015, together with the general partner of American Midstream Partners, LP. The ex-dividend date is February 4, 2015.
The Partnership expects 2014 Adjusted EBITDA to be at the low end of the Partnership’s guidance range of $46 million to $48 million. As previously announced, the distribution coverage ratio for the fourth quarter and full-year 2014 is expected to be approximately 1.2 and approximately 1.0, respectively.
As a result of the commodity price environment, the Partnership is evaluating the magnitude and timing of future quarterly and annual distribution increases. Importantly, the Partnership anticipates maintaining the current distribution level through 2015, including the impact of the recent decreases in commodity prices.
“We successfully executed our growth strategy in 2014, including the acquisition and continued expansion of the Lavaca system in the Eagle Ford, as well as the acquisitions of Main Pass Oil Gathering and Costar Midstream,” said Steve Bergstrom, Executive Chairman, President, and Chief Executive Officer. “We announced in October our intention to increase the fourth quarter distribution as a result of the Costar acquisition. However, we elected to maintain our current distribution given recent volatility in commodity prices. We are evaluating the impact of commodity price changes to our 2015 guidance and will provide updated 2015 guidance, as well as updates on growth projects and acquisitions from our general partner, in our fourth quarter earnings press release. It is important to note that we expect to sustain our current quarterly distribution in 2015 in the current commodity price environment. In addition, ArcLight Capital Partners, which controls our general partner, remains strongly supportive of American Midstream, and we remain confident in our ability to continue executing a long-term growth strategy through a combination of organic growth projects as well as third-party and drop-down acquisitions. Looking forward, we will continue to operate prudently while remaining committed to providing long-term, sustainable distribution growth.”
About American Midstream Partners, LP
Denver-based American Midstream Partners is a growth-oriented limited partnership formed to own, operate, develop and acquire a diversified portfolio of midstream energy assets. The Partnership provides midstream services in the Texas, North Dakota, Gulf Coast and Southeast regions of the United States. For more information about American Midstream Partners, LP, visit www.AmericanMidstream.com.
This press release includes forward-looking statements. These statements relate to, among other things, expected closing of acquisitions, growth projects, cash flows and capital expenditures. We have used the words "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "plan," "predict," "project," "should," "will," "potential," and similar terms and phrases to identify forward-looking statements in this press release. Although we believe the assumptions upon which these forward-looking statements are based are reasonable, any of these assumptions could prove to be inaccurate and the forward-looking statements based on these assumptions could be incorrect. Our operations and future growth involve risks and uncertainties, many of which are outside our control, and any one of which, or a combination of which, could materially affect our results of operations and whether the forward-looking statements ultimately prove to be correct. Actual results and trends in the future may differ materially from those suggested or implied by the forward-looking statements depending on a variety of factors which are described in greater detail in our filings with the SEC. Please see our Risk Factor disclosures included in our Annual Report on Form 10-K for the year ended December 31, 2013 filed on March 11, 2014, and our Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 filed on November 10, 2014. On December 23, 2014, we filed Amendment No. 1 on Form 10-Q/A to our Quarterly Report on Form 10-Q for the quarter ended September 30, 2014. All future written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the previous statements. The forward-looking statements herein speak as of the date of this press release. We undertake no obligation to update any information contained herein or to publicly release the results of any revisions to any forward-looking statements that may be made to reflect events or circumstances that occur, or that we become aware of, after the date of this press release.
This release serves as qualified notice to nominees as provided for under Treasury Regulation Section 1.1446-4(b)(4) and (d). Please note that 100 percent of American Midstream Partners, LP’s distributions to foreign investors are attributable to income that is effectively connected with a United States trade or business. Accordingly, all of American Midstream Partners, LP 's distributions to foreign investors are subject to federal income tax withholding at the highest effective tax rate for individuals or corporations, as applicable. Nominees, and not American Midstream Partners, LP, are treated as withholding agents responsible for withholding distributions received by them on behalf of foreign investors.
Non-GAAP Financial Measures
This press release includes forecasted non-GAAP financial measures, including “Adjusted EBITDA.” The GAAP measure most directly comparable to Adjusted EBITDA is net income (loss). Net loss attributable to the Partnership is forecasted to be approximately $0.2 million in 2014.
Adjusted EBITDA is calculated as net income, plus interest expense, income tax expense, depreciation expense, certain non-cash charges such as non-cash compensation, unrealized losses on commodity derivative contracts, cash distributions in excess of earnings from unconsolidated affiliate and selected charges that are unusual or non-recurring, less interest income, income tax benefit, unrealized gains on commodity derivative contracts, amortization of commodity put purchase costs and selected gains that are unusual or nonrecurring.
Adjusted EBITDA has important limitations as an analytical tool because it excludes some, but not all, items that affect the most directly comparable GAAP financial measures. Management compensates for the limitations of these non-GAAP measures as analytical tools by reviewing the comparable GAAP measures, understanding the differences between the measures and incorporating these data points into management’s decision-making process. You should not consider adjusted EBITDA in isolation or as a substitute for or more meaningful than analysis of our results as reported under GAAP. Adjusted EBITDA may be defined differently by other companies in our industry. Our definitions of these non-GAAP financial measures may not be comparable to similarly titled measures of other companies, thereby diminishing their utility.