Cheniere Partners Reports Third Quarter Results and Provides Full Year 2022 Distribution Guidance
Cheniere Energy Partners reported third-quarter 2021 financial results, with a net income of $381 million and adjusted EBITDA of $738 million. Year-to-date, net income reached $1.1 billion, up from $774 million in 2020. Revenues surged by 137% to $2.3 billion for the quarter, driven by higher LNG export volumes, which increased by 139%. The company declared a distribution of $0.680 per common unit, with 2021 full-year distribution guidance maintained at $2.60 - $2.70 per unit and $3.00 - $3.25 for 2022. Train 6 of the SPL Project is expected to achieve substantial completion in Q1 2022.
- Net income increased by $448 million in Q3 2021 compared to Q3 2020.
- Adjusted EBITDA rose by 110% to $738 million for Q3 2021.
- LNG export volumes increased by 139% in Q3 2021.
- 2021 distribution guidance maintained at $2.60 - $2.70 per unit.
- 2022 distribution guidance introduced at $3.00 - $3.25 per unit.
- Higher prices per MMBtu of LNG delivered were offset by increased feedstock costs.
HIGHLIGHTS
-
Net income of
and$381 million for the three and nine months ended$1.1 billion September 30, 2021 , respectively. -
Adjusted EBITDA1 of
and$738 million for the three and nine months ended$2.2 billion September 30, 2021 , respectively. -
Declared a distribution of
per common unit that will be paid on$0.68 0November 12, 2021 to unitholders of record as ofNovember 5, 2021 . -
Reconfirming full year 2021 distribution guidance of
-$2.60 per unit.$2.70 -
Introducing full year 2022 distribution guidance of
-$3.00 per unit.$3.25 -
In
September 2021 , feed gas was introduced into Train 6 of theSPL Project (defined below) as part of the commissioning process. Train 6 is expected to achieve substantial completion in the first quarter of 2022.
2021 FULL YEAR DISTRIBUTION GUIDANCE |
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|
2021 |
|||||||
Distribution per Unit |
$ |
2.60 |
|
- |
$ |
2.70 |
|
|
|
|
|||||||
2022 FULL YEAR DISTRIBUTION GUIDANCE |
||||||||
|
2022 |
|||||||
Distribution per Unit |
$ |
3.00 |
|
- |
$ |
3.25 |
|
SUMMARY AND REVIEW OF FINANCIAL RESULTS |
|||||||||||||||||||
|
|||||||||||||||||||
(in millions, except LNG data) |
|
Three Months Ended |
|
Nine Months Ended |
|||||||||||||||
|
|
2021 |
|
2020 |
|
% Change |
|
2021 |
|
2020 |
|
% Change |
|||||||
Revenues |
|
$ |
2,324 |
|
$ |
982 |
|
|
137 |
% |
|
$ |
6,176 |
|
$ |
4,170 |
|
48 |
% |
Net income (loss) |
|
$ |
381 |
|
$ |
(67 |
) |
|
nm |
|
|
$ |
1,123 |
|
$ |
774 |
|
45 |
% |
Adjusted EBITDA1 |
|
$ |
738 |
|
$ |
352 |
|
|
110 |
% |
|
$ |
2,207 |
|
$ |
1,990 |
|
11 |
% |
LNG exported: |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Number of cargoes |
|
|
86 |
|
|
36 |
|
|
139 |
% |
|
|
262 |
|
|
186 |
|
41 |
% |
Volumes (TBtu) |
|
|
307 |
|
|
126 |
|
|
144 |
% |
|
|
939 |
|
|
656 |
|
43 |
% |
LNG volumes loaded (TBtu) |
|
|
308 |
|
|
122 |
|
|
152 |
% |
|
|
938 |
|
|
656 |
|
43 |
% |
Net income increased
During the three and nine months ended
During the three and nine months ended
KEY FINANCIAL TRANSACTIONS
In
During 2021, SPL entered into a series of note purchase agreements for the sale of approximately
SABINE PASS LIQUEFACTION PROJECT UPDATE
As of
Construction Progress as of |
||
|
|
|
|
Train 6 |
|
Project Status |
Commissioning |
|
Project Completion Percentage (1) |
|
|
Expected Substantial Completion |
1Q 2022 |
(1) |
Engineering |
SPL Project Overview
We own natural gas liquefaction facilities consisting of five operational liquefaction Trains and one additional Train in commissioning, with a total production capacity of approximately 30 million tonnes per annum (“mtpa”) of LNG at the
DISTRIBUTIONS TO UNITHOLDERS
We declared a cash distribution of
INVESTOR CONFERENCE CALL AND WEBCAST
1 |
Non-GAAP financial measure. See “Reconciliation of Non-GAAP Measures” for further details. |
About
For additional information, please refer to the
Use of Non-GAAP Financial Measures
In addition to disclosing financial results in accordance with
Forward-Looking Statements
This press release contains certain statements that may include “forward-looking statements.” All statements, other than statements of historical or present facts or conditions, included herein are “forward-looking statements.” Included among “forward-looking statements” are, among other things, (i) statements regarding Cheniere Partners’ financial and operational guidance, business strategy, plans and objectives, including the development, construction and operation of liquefaction facilities, (ii) statements regarding expectations regarding regulatory authorizations and approvals, (iii) statements expressing beliefs and expectations regarding the development of Cheniere Partners’ LNG terminal and liquefaction business, (iv) statements regarding the business operations and prospects of third parties, (v) statements regarding potential financing arrangements, (vi) statements regarding future discussions and entry into contracts, and (vii) statements regarding the COVID-19 pandemic and its impact on our business and operating results. Although
(Financial Tables Follow)
Consolidated Statements of Operations (in millions, except per unit data)(1) (unaudited) |
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|
||||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
|
|
|
||||||||||||
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Revenues |
|
|
|
|
|
|
|
|
||||||||
LNG revenues |
|
$ |
1,791 |
|
|
$ |
807 |
|
|
$ |
5,057 |
|
|
$ |
3,588 |
|
LNG revenues—affiliate |
|
|
453 |
|
|
|
103 |
|
|
|
878 |
|
|
|
352 |
|
Regasification revenues |
|
|
68 |
|
|
|
67 |
|
|
|
202 |
|
|
|
202 |
|
Other revenues |
|
|
12 |
|
|
|
5 |
|
|
|
39 |
|
|
|
28 |
|
Total revenues |
|
|
2,324 |
|
|
|
982 |
|
|
|
6,176 |
|
|
|
4,170 |
|
|
|
|
|
|
|
|
|
|
||||||||
Operating costs and expenses |
|
|
|
|
|
|
|
|
||||||||
Cost of sales (excluding items shown separately below) |
|
|
1,342 |
|
|
|
454 |
|
|
|
3,178 |
|
|
|
1,551 |
|
Cost of sales—affiliate |
|
|
8 |
|
|
|
33 |
|
|
|
62 |
|
|
|
38 |
|
Cost of sales—related party |
|
|
— |
|
|
|
— |
|
|
|
1 |
|
|
|
— |
|
Operating and maintenance expense |
|
|
148 |
|
|
|
146 |
|
|
|
465 |
|
|
|
463 |
|
Operating and maintenance expense—affiliate |
|
|
34 |
|
|
|
34 |
|
|
|
103 |
|
|
|
115 |
|
Operating and maintenance expense—related party |
|
|
12 |
|
|
|
— |
|
|
|
34 |
|
|
|
— |
|
Development expense |
|
|
— |
|
|
|
— |
|
|
|
1 |
|
|
|
— |
|
General and administrative expense |
|
|
2 |
|
|
|
2 |
|
|
|
7 |
|
|
|
12 |
|
General and administrative expense—affiliate |
|
|
22 |
|
|
|
24 |
|
|
|
64 |
|
|
|
73 |
|
Depreciation and amortization expense |
|
|
140 |
|
|
|
137 |
|
|
|
417 |
|
|
|
413 |
|
Impairment expense and loss on disposal of assets |
|
|
— |
|
|
|
— |
|
|
|
6 |
|
|
|
5 |
|
Total operating costs and expenses |
|
|
1,708 |
|
|
|
830 |
|
|
|
4,338 |
|
|
|
2,670 |
|
|
|
|
|
|
|
|
|
|
||||||||
Income from operations |
|
|
616 |
|
|
|
152 |
|
|
|
1,838 |
|
|
|
1,500 |
|
|
|
|
|
|
|
|
|
|
||||||||
Other income (expense) |
|
|
|
|
|
|
|
|
||||||||
Interest expense, net of capitalized interest |
|
|
(210 |
) |
|
|
(221 |
) |
|
|
(636 |
) |
|
|
(691 |
) |
Loss on modification or extinguishment of debt |
|
|
(27 |
) |
|
|
— |
|
|
|
(81 |
) |
|
|
(43 |
) |
Other income, net |
|
|
2 |
|
|
|
2 |
|
|
|
2 |
|
|
|
8 |
|
Total other expense |
|
|
(235 |
) |
|
|
(219 |
) |
|
|
(715 |
) |
|
|
(726 |
) |
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) |
|
$ |
381 |
|
|
$ |
(67 |
) |
|
$ |
1,123 |
|
|
$ |
774 |
|
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted net income (loss) per common unit |
|
$ |
0.69 |
|
|
$ |
(0.08 |
) |
|
$ |
2.07 |
|
|
$ |
1.55 |
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average number of common units outstanding used for basic and diluted net income (loss) per common unit calculation |
|
|
484.0 |
|
|
|
414.8 |
|
|
|
484.0 |
|
|
|
370.9 |
|
______________ | ||
(1) |
Please refer to the |
Consolidated Balance Sheets (in millions, except unit data) (1) |
||||||||
|
|
|
|
|||||
|
2021 |
|
2020 |
|||||
ASSETS |
(unaudited) |
|
|
|||||
Current assets |
|
|
|
|||||
Cash and cash equivalents |
$ |
1,713 |
|
|
$ |
1,210 |
|
|
Restricted cash |
|
133 |
|
|
|
97 |
|
|
Accounts and other receivables, net of current expected credit losses |
|
358 |
|
|
|
318 |
|
|
Accounts receivable—affiliate |
|
198 |
|
|
|
184 |
|
|
Advances to affiliate |
|
130 |
|
|
|
144 |
|
|
Inventory |
|
134 |
|
|
|
107 |
|
|
Current derivative assets |
|
44 |
|
|
|
14 |
|
|
Other current assets |
|
105 |
|
|
|
61 |
|
|
Total current assets |
|
2,815 |
|
|
|
2,135 |
|
|
|
|
|
|
|||||
Property, plant and equipment, net of accumulated depreciation |
|
16,820 |
|
|
|
16,723 |
|
|
Operating lease assets, net of accumulated amortization |
|
93 |
|
|
|
99 |
|
|
Debt issuance costs, net of accumulated amortization |
|
13 |
|
|
|
17 |
|
|
Derivative assets |
|
25 |
|
|
|
11 |
|
|
Other non-current assets, net |
|
163 |
|
|
|
160 |
|
|
Total assets |
$ |
19,929 |
|
|
$ |
19,145 |
|
|
|
|
|
|
|||||
LIABILITIES AND PARTNERS’ EQUITY |
|
|
|
|||||
Current liabilities |
|
|
|
|||||
Accounts payable |
$ |
14 |
|
|
$ |
12 |
|
|
Accrued liabilities |
|
846 |
|
|
|
658 |
|
|
Accrued liabilities—related party |
|
5 |
|
|
|
4 |
|
|
Current debt, net of discount and debt issuance costs |
|
944 |
|
|
|
— |
|
|
Due to affiliates |
|
45 |
|
|
|
53 |
|
|
Deferred revenue |
|
166 |
|
|
|
137 |
|
|
Deferred revenue—affiliate |
|
4 |
|
|
|
1 |
|
|
Current operating lease liabilities |
|
8 |
|
|
|
7 |
|
|
Current derivative liabilities |
|
23 |
|
|
|
11 |
|
|
Total current liabilities |
|
2,055 |
|
|
|
883 |
|
|
|
|
|
|
|||||
Long-term debt, net of premium, discount and debt issuance costs |
|
17,171 |
|
|
|
17,580 |
|
|
Non-current deferred revenue |
|
1 |
|
|
|
— |
|
|
Operating lease liabilities |
|
85 |
|
|
|
90 |
|
|
Derivative liabilities |
|
13 |
|
|
|
35 |
|
|
Other non-current liabilities |
|
— |
|
|
|
1 |
|
|
Other non-current liabilities—affiliate |
|
15 |
|
|
|
17 |
|
|
|
|
|
|
|||||
Partners’ equity |
|
|
|
|||||
Common unitholders’ interest (484.0 million units issued and outstanding at both |
|
856 |
|
|
|
714 |
|
|
General partner’s interest ( |
|
(267 |
) |
|
|
(175 |
) |
|
Total partners’ equity |
|
589 |
|
|
|
539 |
|
|
Total liabilities and partners’ equity |
$ |
19,929 |
|
|
$ |
19,145 |
|
______________ | ||
(1) |
Please refer to the |
Reconciliation of Non-GAAP Measures Regulation G Reconciliations |
||||||||||||||||
Adjusted EBITDA |
||||||||||||||||
The following table reconciles our Adjusted EBITDA to |
||||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
|||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|||||||||
Net income (loss) |
$ |
381 |
|
|
$ |
(67 |
) |
|
$ |
1,123 |
|
|
$ |
774 |
|
|
Interest expense, net of capitalized interest |
|
210 |
|
|
|
221 |
|
|
|
636 |
|
|
|
691 |
|
|
Loss on modification or extinguishment of debt |
|
27 |
|
|
|
— |
|
|
|
81 |
|
|
|
43 |
|
|
Other income, net |
|
(2 |
) |
|
|
(2 |
) |
|
|
(2 |
) |
|
|
(8 |
) |
|
Income from operations |
$ |
616 |
|
|
$ |
152 |
|
|
$ |
1,838 |
|
|
$ |
1,500 |
|
|
Adjustments to reconcile income from operations to Adjusted EBITDA: |
|
|
|
|
|
|
|
|||||||||
Depreciation and amortization expense |
|
140 |
|
|
|
137 |
|
|
|
417 |
|
|
|
413 |
|
|
Loss (gain) from changes in fair value of commodity derivatives, net (1) |
|
(18 |
) |
|
|
62 |
|
|
|
(54 |
) |
|
|
36 |
|
|
Impairment expense and loss on disposal of assets |
|
— |
|
|
|
— |
|
|
|
6 |
|
|
|
5 |
|
|
Incremental costs associated with COVID-19 response |
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
36 |
|
|
Adjusted EBITDA |
$ |
738 |
|
|
$ |
352 |
|
|
$ |
2,207 |
|
|
$ |
1,990 |
|
(1) |
Change in fair value of commodity derivatives prior to contractual delivery or termination |
Adjusted EBITDA is commonly used as a supplemental financial measure by our management and external users of our Consolidated Financial Statements to assess the financial performance of our assets without regard to financing methods, capital structures, or historical cost basis. Adjusted EBITDA is not intended to represent cash flows from operations or net income as defined by
We believe Adjusted EBITDA provides relevant and useful information to management, investors and other users of our financial information in evaluating the effectiveness of our operating performance in a manner that is consistent with management’s evaluation of financial and operating performance.
Adjusted EBITDA is calculated by taking net income (loss) before interest expense, net of capitalized interest, depreciation and amortization, and adjusting for the effects of certain non-cash items, other non-operating income or expense items and other items not otherwise predictive or indicative of ongoing operating performance, including the effects of modification or extinguishment of debt, impairment expense and loss on disposal of assets, changes in the fair value of our commodity derivatives prior to contractual delivery or termination, and non-recurring costs related to our response to the COVID-19 outbreak which are incremental to and separable from normal operations. The change in fair value of commodity derivatives is considered in determining Adjusted EBITDA given that the timing of recognizing gains and losses on these derivative contracts differs from the recognition of the related item economically hedged. We believe the exclusion of these items enables investors and other users of our financial information to assess our sequential and year-over-year performance and operating trends on a more comparable basis and is consistent with management’s own evaluation of performance.
View source version on businesswire.com: https://www.businesswire.com/news/home/20211104005148/en/
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Source:
FAQ
What were Cheniere Energy Partners' financial results for Q3 2021?
How much did Cheniere declare for its distribution per common unit?
What is the distribution guidance for Cheniere Energy Partners for 2022?
What is the status of the SPL Project's Train 6?