01—Abstract
Summary
Summary of the 10-K/A filed February 29, 2016. Cited figures are marked; the original filing is the authoritative source.
This excerpt is not a complete Form 10-K.
It contains only Item 9B (Other Information) and the Item 15 exhibit index from what the filing describes as Amendment No. 1, so it includes no audited financial statements, revenue, earnings, cash flow, or balance sheet data. Any assessment of Cheniere's 2015 operating or financial performance would require the full filing, and none is offered here. The substantive disclosure is a Section 13(r) / ITRA compliance statement.
Cheniere states that it and its affiliates had no transactions with Iran or Iran-related persons in fiscal 2015. The section also discloses indirect exposure through Blackstone Group, which holds more than 29%a of Cheniere Partners and has three board representatives on its general partner. Blackstone reported that two portfolio companies, Hilton and Travelport, had small Iran-related activities in 2015.
Cheniere says it has not independently verified these disclosures. The exhibit index shows the scale of Cheniere's project-level contracting and financing activity. It lists Bechtel EPC agreements for Sabine Pass Stages 1–3 and Corpus Christi Stages 1–2, long-term FOB LNG sale and purchase agreements with a range of international buyers, and multiple debt instruments, including senior secured notes, convertible notes, and project term loan and credit facilities.
It also references an August 2015 nomination and standstill agreement with Icahn entities and amended bylaws from December 2015. Investors should review the complete 10-K for financial results and the full description of these items.
02—Key points
Key Highlights
- No Iran transactions: Cheniere reports that neither it nor its affiliates engaged in any transactions with Iran or Iran-related persons during fiscal 2015 (Section 13(r) / ITRA disclosure).
- Blackstone affiliation: Blackstone CQP Holdco LP holds more than 29% of Cheniere Partners' equity interests and has three representatives on the board of Cheniere Partners' general partner, which may make Blackstone portfolio companies affiliates of Cheniere under Rule 12b-2.
- Hilton (Transcorp Hilton Abuja): Blackstone reported an Iranian governmental delegation stayed one night at the hotel, booked and paid for by the Nigerian government, generating about $5,320 in revenue and about $495 in net profit, which Hilton says is exempt from Iranian sanctions.
- Travelport: Blackstone reported roughly $551,000 in gross revenue and $389,000 in net profit from Travelport's technology services to Iran Air and Iran Air Tours in 2015, which Travelport says are exempt or OFAC-licensed.
- Project contracting: The exhibit index lists Bechtel EPC agreements covering Sabine Pass Liquefaction Stages 1–3 and Corpus Christi Liquefaction Stages 1–2, indicating a large, multi-train LNG build-out.
- Financing structure: Exhibits include senior secured notes (5.625%–6.5% series), 11.0% senior secured notes due 2025, 4.25% convertible senior notes due 2045, a 4.875% PIK convertible note, and project-level term loan and credit facilities.
- Governance: The index includes an August 2015 Nomination and Standstill Agreement with Icahn-affiliated entities and amended and restated bylaws dated December 9, 2015.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-K/AFY2015filed February 29, 2016Financial Statements
FY2015 against FY2014
| Line item | FY2015FY2014 | Change |
|---|---|---|
| Revenue | $271.00M$267.95M | +1.1% |
| Cost of Revenue | -$15.00M-$342K | −4286.0% |
| Gross Profit | $286.00M$268.30M | +6.6% |
| R&D Expenses | $42.00M$54.38M | −22.8% |
| SG&A Expenses | $363.00M$323.71M | +12.1% |
| Operating Expenses | $720.00M$540.13M | +33.3% |
| Operating Income | -$449.00M-$272.18M | −65.0% |
| Interest Expense | $322.00M$181.24M | +77.7% |
| Net Income | -$975.00M-$547.93M | −77.9% |
| EPS (Basic) | $-4.30$-2.44 | −76.2% |
| Shares Outstanding (Basic) | 226.90M224.34M | +1.1% |
| Shares Outstanding (Diluted) | 226.90M224.34M | +1.1% |
05—Questions
Frequently Asked Questions
Does this filing show Cheniere's 2015 revenue, net income, or cash flow?
No. The excerpt contains only Item 9B and the Item 15 exhibit index. Financial statements, MD&A, and results of operations are not included, so the full 10-K is needed for financial performance.
Did Cheniere itself have any Iran-related business in 2015?
According to the filing, no. Cheniere states that during fiscal 2015 it did not engage in any transactions with Iran or with persons or entities related to Iran.
Why are Hilton and Travelport mentioned in Cheniere's filing?
Blackstone holds more than 29% of Cheniere Partners and has board representation, so Blackstone's portfolio companies may be deemed affiliates of Cheniere under SEC rules. Cheniere includes Blackstone's reported Iran-related disclosures for Hilton and Travelport to provide transparency, while noting it has not independently verified them.
What does the exhibit list reveal about Cheniere's strategy?
The exhibits show a major LNG export build-out. Sabine Pass and Corpus Christi liquefaction projects are supported by Bechtel EPC contracts and long-term FOB sale and purchase agreements with buyers such as Gas Natural Fenosa, GAIL, Centrica, Endesa, EDF, and PT Pertamina, and are financed through a mix of project debt, senior secured notes, and convertible notes.
Are there governance developments investors should note?
The index references an August 21, 2015 Nomination and Standstill Agreement with Icahn-affiliated entities and amended and restated bylaws effective December 9, 2015. The full filing and the referenced exhibits should be reviewed for the terms of these arrangements.
06—Continue