Antero Midstream (AM) - 2024 Q1 - Quarterly Report

Revenue Performance - Total revenues for the three months ended March 31, 2024, were $279.051 million, compared to$259.475 million for the same period in 2023, representing a 7.5% increase [131]. - Revenue from Antero Resources increased to $227.593 million in Q1 2024 from$211.576 million in Q1 2023, a growth of 7.6% [134]. - Total revenues increased by 8%, from $259 million for the three months ended March 31, 2023 to$279 million for the three months ended March 31, 2024 [136]. - Gathering and processing revenues increased by 15%, from $190 million to$218 million during the same period [136]. - Low pressure gathering revenue increased by $19 million due to lower growth incentive fee rebates and increased throughput volumes of 15 Bcf, or 130 MMcf/d [137]. - Fresh water delivery revenue decreased by$2 million primarily due to decreased delivery volumes of 1 MMBbl, or 10 MBbl/d [140]. - Equity in earnings of unconsolidated affiliates increased by 13%, from $24 million to$28 million [144]. - Net cash provided by operating activities increased from $183 million to$211 million [149]. Operating Income and Expenses - Operating income for the gathering and processing segment was $154.025 million in Q1 2024, up from$134.186 million in Q1 2023, reflecting a 14.8% increase [134]. - Operating expenses for the three months ended March 31, 2024, totaled $112.800 million, compared to$111.130 million for the same period in 2023, a slight increase of 1.5% [134]. - Direct operating expenses decreased by 7%, from $58 million to$54 million [141]. - Capital expenditures totaled $29.8 million for the three months ended March 31, 2024, down from$33.6 million in the same period of 2023 [152]. - The company announced a capital budget for 2024 ranging from $150 million to$170 million to support maintenance capital programs [151]. Net Income and Shareholder Returns - Net income for the three months ended March 31, 2024, was $103.926 million, compared to$86.507 million for the same period in 2023, indicating a 20.2% increase [134]. - A cash dividend of $0.2250 per share was declared for the quarter ended March 31, 2024 [147]. - A share repurchase program was authorized on February 13, 2024, allowing the company to repurchase up to$500 million of its common stock [125]. Financial Position and Debt - The company issued $600 million of 2032 Notes on January 16, 2024, to repay outstanding borrowings on the Credit Facility [124]. - As of March 31, 2024, the company had no borrowings or letters of credit outstanding under the Credit Facility [158]. - A 1.0$1 million for the three months ended March 31, 2024 [158]. Market Conditions and Risks - The company expects commodity prices to remain volatile but does not anticipate significant variability in throughput volumes due to Antero Resources' improved liquidity and leverage position [126]. - The Federal Reserve increased the federal funds interest rate by 5.25% from March 2022 to March 2024, impacting the company's financial condition [127]. - The company is highly dependent on Antero Resources, expecting to derive substantially all revenues from them for the foreseeable future [159]. - Any adverse events affecting Antero Resources' production or financial condition could negatively impact the company's revenues and operating results [160]. - The company faces risks of non-payment or non-performance by Antero Resources under their agreements [160]. Segment Information - The company operates two reportable segments: gathering and processing, and water handling, with significant contributions from both segments to overall revenues [129]. - The company has fixed-fee and cost of service fee structures in agreements with Antero Resources to mitigate commodity price risk [157].