01—Abstract
Summary
Summary of the 10-Q filed May 8, 2024. Cited figures are marked; the original filing is the authoritative source.
Western Midstream Partners, LP (the Partnership) reported first-quarter 2024 net income of $586.2 milliona, compared with $208.3 million in the first quarter of 2023.
Total revenues and other rose to $887.7 millionb from $734.0 million, and operating income was $679.4 million versus $290.2 million. The increase was driven largely by a $239.6 million gain on divestiture and other, net, which resulted from the first-quarter sale of interests in Mont Belvieu JV, Whitethorn LLC, Panola, and Saddlehorn for combined proceeds of $588.6 million. Service revenues – fee based were $781.3 million, up from $647.9 million, reflecting the Meritage acquisition and higher throughput.
Operating metrics improved year over year. Natural-gas throughput attributable to WES was 4,990 MMcf/d, and produced-water throughput was 1,126 MBbls/d, while crude-oil and NGLs throughput fell to 565 MBbls/d due to the divestitures. Adjusted EBITDA was $608.4 millionc versus $498.7 million a year earlier, and Free cash flow was $225.0 million versus $141.6 million.
Net cash provided by operating activities was $399.7 milliond, compared with $302.4 million. The balance sheet reflects debt reduction and asset sales. Short-term debt fell to $108.4 million from $617.7 million after net commercial paper repayments of $510.4 million, and total long-term debt carrying value was $7.27 billion.
The Partnership declared a first-quarter 2024 distribution of $0.875 per unit, up from $0.575 in the fourth quarter of 2023, and it had $627.8 million remaining under its $1.25 billion buyback program, with no units repurchased in the quarter. The Marcellus Interest systems sale closed in April 2024 for proceeds of $206.2 million, with an estimated net gain of approximately $65.0 million expected in the second quarter.
02—Key points
Key Highlights
- Net income of $586.2 million for Q1 2024 versus $208.3 million in Q1 2023, including a $239.6 million gain on divestiture and other, net.
- Sold interests in Mont Belvieu JV, Whitethorn LLC, Panola, and Saddlehorn in Q1 2024 for combined proceeds of $588.6 million.
- Adjusted EBITDA of $608.4 million, up from $498.7 million; Free cash flow of $225.0 million, up from $141.6 million.
- Fee-based service revenues rose to $781.3 million from $647.9 million, aided by the Meritage acquisition and higher throughput.
- Short-term debt fell to $108.4 million from $617.7 million after $510.4 million of net commercial paper repayments.
- Q1 2024 distribution declared at $0.875 per unit, up from $0.575 per unit in Q4 2023; no units repurchased in the quarter under the $1.25 billion program.
- Marcellus Interest systems sold in April 2024 for $206.2 million, with an estimated net gain of approximately $65.0 million expected in Q2 2024.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2024filed May 8, 2024Financial Statements
Q1 FY2024 against Q1 FY2023
| Line item | Q1 FY2024Q1 FY2023 | Change |
|---|---|---|
| Revenue | $887.29M$733.70M | +20.9% |
| Operating Expenses | $480.79M$480.67M | 0.0% |
| Operating Income | $679.37M$290.21M | +134.1% |
| Interest Expense | $94.51M$81.67M | +15.7% |
| Net Income | $572.83M$203.65M | +181.3% |
| EPS (Basic) | $1.47$0.52 | +182.7% |
| EPS (Diluted) | $1.47$0.52 | +182.7% |
05—Questions
Frequently Asked Questions
How did Western Midstream's earnings change in the first quarter of 2024?
Net income attributable to Western Midstream Partners, LP was $572.8 million, versus $203.6 million in the first quarter of 2023. The increase was driven mainly by the $239.6 million gain on divestiture and other, net, and by total revenues and other rising to $887.7 million from $734.0 million.
What drove the increase in operating results?
The filing attributes higher service revenues to the Meritage acquisition, which added Powder River Basin volumes, and to increased throughput at the West Texas, DJ Basin, and DBM water systems. Cost-of-service rate redeterminations effective January 1, 2024, also raised fees at several complexes.
Did the Partnership change its distribution or buyback activity?
The Board declared a first-quarter 2024 distribution of $0.875 per unit, totaling $340.9 million, payable May 15, 2024. No common units were repurchased in the first quarter of 2024, leaving $627.8 million authorized under the $1.25 billion Purchase Program through December 31, 2024.
How did the company's debt position change?
Short-term debt decreased to $108.4 million from $617.7 million, mainly from $510.4 million of net commercial paper repayments. WES Operating also repurchased and retired $15.1 million of senior notes in the quarter, and it retired an additional $134.9 million of notes subsequent to March 31, 2024. The RCF had $1.9 billion in effective borrowing capacity.
What are the notable subsequent events?
The Partnership closed the sale of its 33.75% interest in the Marcellus Interest systems in April 2024 for $206.2 million, with an estimated net gain of approximately $65.0 million to be recorded in the second quarter of 2024. WES Operating also purchased and retired $134.9 million of senior notes after March 31, 2024.
06—Continue