Financial Performance - Total revenues for the three months ended September 30, 2024, were $102,415 thousand, a decrease of 15.5% compared to $121,193 thousand for the same period in 2023[21]. - Net income attributable to common equity holders for the three months ended September 30, 2024, was a loss of $204,941 thousand, compared to a loss of $2,753 thousand for the same period in 2023[21]. - The company reported a net loss before income taxes of $54,968 thousand for the three months ended September 30, 2024, compared to income of $3,946 thousand for the same period in 2023[21]. - The company recorded a net income tax benefit of $142,573 thousand for the three months ended September 30, 2024, compared to an expense of $72 thousand in the same period last year[21]. - The company reported a net loss of $201.5 million for the three months ended September 30, 2024, compared to a net income of $0.3 million for the same period in 2023[60]. - The net income attributable to common equity holders for the nine months ended September 30, 2024, was a loss of $110 million, compared to a loss of $41.1 million for the same period in 2023[60]. Equity and Liabilities - As of September 30, 2024, total equity stood at $651.484 million, down from $718.563 million as of December 31, 2023[18]. - Total liabilities and equity amounted to $1.999 billion as of September 30, 2024, compared to $2.494 billion at the end of 2023[18]. - The accumulated deficit was recorded at $(157.798) million as of September 30, 2024[18]. - Total debt as of September 30, 2024, is $956.97 million, a decrease from $1.47 billion on December 31, 2023[47]. - The First Lien Net Leverage Ratio is 0.84:1.00, and the Interest Coverage Ratio is 2.42:1.00 as of September 30, 2024, indicating compliance with financial covenants[48]. Cash Flow and Capital Expenditures - For the nine months ended September 30, 2024, net cash provided by operating activities was $40,124,000, down from $110,759,000 in the same period of 2023[26]. - Capital expenditures for the nine months ended September 30, 2024, were $37,861,000, a decrease from $49,863,000 in 2023[26]. - Cash interest paid in 2024 was $89.4 million, an increase from $72.7 million in 2023[61]. - Cash flows used in investing activities included $332.7 million from the sale of Ohio Gathering and $292.3 million from the Utica Sale for the nine months ended September 30, 2024[125]. Revenue Sources and Business Operations - The company generates a majority of its revenues through long-term and fee-based gathering agreements, many of which include minimum volume commitments (MVCs)[140]. - The estimated revenue expected to be recognized from gathering services and related fees for the remainder of 2024 is $12.0 million, with projections of $37.2 million in 2025 and $26.1 million in 2026[33]. - The company is involved in the production of natural gas and crude oil from unconventional resource basins, requiring hydraulic fracturing[13]. - The Double E Project focuses on the development and construction of the Double E Pipeline, enhancing transportation services in the Delaware Basin[7]. Asset Management - As of September 30, 2024, the net property, plant, and equipment amounted to $1.35 billion, down from $1.70 billion as of December 31, 2023[41]. - The company recognized an impairment of $68.0 million related to the Mountaineer Midstream system and compression assets, based on estimated fair value[32]. - The company completed the sale of Summit Utica for a cash price of $625.0 million, recognizing a total gain of $212.5 million during the quarterly period ended March 31, 2024[31]. Market and Economic Conditions - The company anticipates ongoing impacts from geopolitical events affecting commodity prices, including the Russia-Ukraine conflict and Middle East tensions[79]. - Future business will be influenced by U.S. shale production dynamics and capital market conditions[79]. - The company is exposed to fluctuations in natural gas, NGLs, and crude oil prices due to political or economic measures taken by various countries or OPEC[134]. Corporate Governance and Structure - The company completed a corporate reorganization effective August 1, 2024, transitioning from a limited partnership to a corporation[27]. - The merger resulted in the conversion of each outstanding common unit into one share of common stock, impacting the equity structure[27]. - The company plans to expand its board from seven to eleven directors following the Business Contribution Agreement with Tall Oak Midstream[81]. Legal and Regulatory Matters - The company is involved in various litigation and administrative proceedings, but management believes these will not materially affect its financial position[66]. - The company does not anticipate recognition of any significant liabilities for uncertain tax positions during the next 12 months[30]. Interest and Debt Management - The company has entered into interest rate hedges covering approximately 90% of the Permian Term Loan Facility at a fixed SOFR rate of 1.23%[48]. - The applicable margin for adjusted SOFR borrowings is 2.75%, with an interest rate of 7.70% as of September 30, 2024[48]. - The company has $120.0 million of interest rate exposure hedged to offset the impact of changes in interest rates on its Permian Transmission Term Loan[139].
Summit Midstream Partners, LP(SMC) - 2024 Q3 - Quarterly Report