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Mar 31, 2020
Antero Midstream Q1 2020 Earnings Report
Announced first quarter 2020 financial results and updated 2020 capital budget and guidance.
Key Takeaways
Antero Midstream reported a net loss of $(393) million, or $(0.81) per share, and adjusted EBITDA of $217 million, a 7% increase compared to the prior year quarter. The company announced further reductions to its capital budget that result in a 65% decrease year-over-year in capital expenditures.
Low pressure gathering volumes averaged 2,717 MMcf/d, a 6% increase as compared to the prior year quarter.
Fresh water delivery volumes averaged 183 MBbl/d during the quarter, a 20% increase compared to the first quarter of 2019.
Adjusted EBITDA was $217 million, a 7% increase compared to the prior year quarter.
Total capital expenditures were $80 million during the first quarter of 2020.
Antero Midstream
Antero Midstream
Antero Midstream Revenue by Segment
Revenue by Segment
Gathering and Processing Revenue
CapyFin.comWater Handling Revenue
CapyFin.comAmortization of Customer Relationships Revenue
CapyFin.com Forward Guidance
Antero Midstream expects a reduction in fresh water delivery volumes in the second half of 2020 and expects to pay three quarterly low pressure gathering rebates. Antero Midstream's updated guidance highlights the flexibility of Antero Midstream’s capital budget and our dedication to capital discipline.
Positive Outlook
- Antero Resources is 94% hedged on its expected natural gas production in 2020 at a price of $2.87/MMbtu.
- Antero Resources is 100% hedged on its expected crude oil and pentane-equivalent production at a price of $55.63/barrel.
- The 65% year-over-year reduction in capital expenditures for 2020 more than offsets the reduction in adjusted EBITDA guidance.
- Improved free cash flow position of $420 to $450 million before return of capital to shareholders.
- Balance sheet with almost $1.0 billion of liquidity and below peer average leverage of 3.7x.
Challenges Ahead
- Reduction in Adjusted EBITDA guidance is primarily driven by a reduction in fresh water delivery volumes in the second half of 2020.
- Three quarterly low pressure gathering rebates are expected, resulting in $36 million of midstream fee reductions.
- Uncertain market conditions impacting the energy industry.
- Potential impacts of the decline in demand for oil and NGLs including additional storage capacity in the Northeast.
- A curtailment could result in a temporary reduction in throughput volumes and revenues for Antero Midstream.
Revenue & Expenses
Visualization of income flow from segment revenue to net income