Summary
Cheniere Energy, Inc. reported its third-quarter results for the period ending September 30, 2016. The company saw a significant increase in total revenues, driven by the commencement of LNG revenues from the Sabine Pass LNG Project (SPL Project) following the substantial completion of Trains 1 and 2. This marks a pivotal shift from the prior year's period, which was characterized by construction and commissioning activities. Despite the revenue ramp-up, the company continued to incur substantial operating costs and expenses, including depreciation and amortization associated with the new operational assets, and significant interest expenses due to its high debt levels. While the company's net loss narrowed compared to the previous year's third quarter, it remains substantial. Investors should monitor the ongoing development of the Corpus Christi LNG Project (CCL Project) and the company's ability to manage its considerable debt obligations while capitalizing on the growing LNG export market.
Financial Highlights
49 data points| Revenue | $465.00M |
| Cost of Revenue | $253.00M |
| Gross Profit | $212.00M |
| R&D Expenses | $2.00M |
| SG&A Expenses | $59.00M |
| Operating Expenses | $450.00M |
| Operating Income | $15.00M |
| Interest Expense | $148.00M |
| Net Income | -$101.00M |
| EPS (Basic) | $-0.44 |
| Shares Outstanding (Basic) | 228.90M |
| Shares Outstanding (Diluted) | 228.90M |
Key Highlights
- 1Total revenues significantly increased to $465.7 million from $66.1 million in the prior year's quarter, primarily due to the commencement of LNG revenues from the Sabine Pass LNG Project as Trains 1 and 2 achieved substantial completion.
- 2The company reported a net loss attributable to common stockholders of $100.4 million ($0.44 per share) for the third quarter of 2016, a decrease from the $297.8 million loss ($1.31 per share) in the same period of 2015.
- 3Operating costs and expenses more than tripled to $450.4 million from $118.1 million, largely driven by the increase in cost of sales and depreciation/amortization expenses related to the start of commercial operations at Sabine Pass.
- 4Interest expense, net of capitalized interest, increased significantly to $148.1 million from $93.6 million, reflecting the company's substantial and growing debt burden.
- 5The company raised substantial debt throughout the nine months of 2016, including issuing $1.5 billion each of 2026 and 2027 SPL Senior Notes, and $1.25 billion of 2024 CCH Senior Notes, while also entering into a $2.8 billion credit facility for Cheniere Partners.
- 6Construction continues on Trains 3 and 4 at the Sabine Pass facility, with Trains 3 and 4 at the Corpus Christi facility in development, indicating ongoing significant capital expenditures.
- 7Cash and cash equivalents decreased to $990.1 million from $1,201.1 million at the end of 2015, while restricted cash increased significantly, reflecting cash set aside for project development and debt service.