HOUSTON - Today Western Midstream Partners, LP (NYSE: WES) ('WES' or the 'Partnership') announced third-quarter 2021 financial and operating results.
Net income (loss) available to limited partners for the third quarter of 2021 totaled $250.2 million, or $0.61 per common unit (diluted), with third-quarter 2021 Adjusted EBITDA(1) totaling $531.6 million, third-quarter 2021 Cash flows provided by operating activities totaling $391.3 million, and third-quarter 2021 Free cash flow(1) totaling $320.0 million.
RECENT HIGHLIGHTS
Executed a debt tender offer and repaid $500.0 million of Senior notes due 2022, 2023, 2025, and 2026 for an aggregate purchase price of approximately $521.9 million, decreasing the Partnership's annualized borrowing costs by $20.6 million(2).
Repurchased 4.5 million common units for aggregate consideration of $88.1 million during the third quarter as part of the previously announced buyback program of up to $250.0 million of the Partnership's common units through December 31, 2021. Since announcing the buyback program, the Partnership has repurchased approximately 8.0 million common units for aggregate consideration of $136.9 million through September 30, 2021.
Received an upgrade for WES Operating's long-term debt from 'BB' to 'BB+' from Standard & Poor's, decreasing the Partnership's annualized borrowing costs by approximately $7.9 million, and a revised outlook rating from 'Stable' to 'Positive' from Fitch.
Increased Regional Oil Treating Facility capacity by 20-percent, or 36 MBbls/d, for minimal capital to meet expected growth in Delaware Basin oil volumes.
On November 12, 2021, WES will pay its third-quarter 2021 per-unit distribution of $0.323, which represents a 1.3-percent increase over the prior quarter's distribution and is consistent with an annualized distribution growth of 5-percent. Third-quarter 2021 Free cash flow after distributions totaled $185.4 million. Third-quarter 2021 and year-to-date capital expenditures(1) totaled $82.0 million and $224.3 million, respectively. Net income and Adjusted EBITDA for the quarter include a non-cash increase to revenue of $19 million associated with a revenue recognition cumulative adjustment related to reversal of constrained revenues.
'The consistent execution of our strategic priorities has led to our strong third-quarter results and positions us for continued success,' said Michael Ure, President and Chief Executive Officer. 'Across the organization, our best-in-class teams continue to pursue cost and capital efficiencies, attract additional volumes on our systems, and maximize our asset value.'
'With our expansive asset footprint and strong producer relationships in the Delaware Basin, we continue to capitalize on robust activity levels in this world-class producing basin. For the third-consecutive quarter, throughput increased across all three products within the Delaware Basin, contributing to our outperformance.'
'Due to our outperformance this quarter, we now expect to finish the year above the high end of our 2021 Adjusted EBITDA range of $1.825 to $1.925 billion. Furthermore, we expect to be below the high end of our 2021 capital expenditure range of $275 million to $375 million. This expectation reflects a slight shift in producer activity into 2022, thus reducing capital requirements in 2021, and our team's continued focus on reducing costs and enhancing operational efficiencies.'
Mr. Ure continued, 'Our operational results have again set the stage for significant free cash flow generation, which provides the resources needed to reduce debt and improve the health of our balance sheet. We've been able to reduce our outstanding Senior Notes by more than $930 million year to date, or 12 percent of our year-end 2020 balance, through the retirement of our 2021 maturity and successful execution of our recent tender offer. With third-quarter Debt-to-Trailing Twelve Month Adjusted EBITDA below 3.7x, we are well below our 2021 target of 4.0x and nearing our 2022 target of 3.5x.'
'We remain committed to returning value to stakeholders through continued distribution growth and opportunistically executing the remaining $113 million available under the unit buyback program.'
Third-quarter 2021 total natural-gas throughput(1) averaged 4.1 Bcf/d, representing a 4-percent sequential-quarter decrease. This decrease primarily relates to (i) decreased volumes at the Bison treating facility, which was sold to a third party during the second quarter of 2021, and (ii) production declines in the DJ Basin and areas around the Marcellus Interest and Springfield gas-gathering systems.
Third-quarter 2021 total throughput for crude-oil and NGLs assets(1) averaged 641 MBbls/d, representing a 7-percent sequential-quarter decrease. This decrease primarily relates to production declines in the DJ Basin and decreased volumes on our equity investments.
Third-quarter 2021 total throughput for produced-water assets(1) averaged 735 MBbls/d, representing a 7-percent sequential-quarter increase.
ABOUT WESTERN MIDSTREAM
Western Midstream Partners, LP ('WES') is a Delaware master limited partnership formed to acquire, own, develop, and operate midstream assets. With midstream assets located in Texas, New Mexico, Colorado, Utah, Wyoming, and Pennsylvania, WES is engaged in the business of gathering, compressing, treating, processing, and transporting natural gas; gathering, stabilizing, and transporting condensate, natural-gas liquids, and crude oil and gathering and disposing of produced water for its customers. In its capacity as a natural-gas processor, WES also buys and sells natural gas, natural-gas liquids, and condensate on behalf of itself and as an agent for its customers under certain contracts.
This news release contains forward-looking statements. WES's management believes that its expectations are based on reasonable assumptions. No assurance, however, can be given that such expectations will prove correct. A number of factors could cause actual results to differ materially from the projections, anticipated results, or other expectations expressed in this news release. These factors include our ability to meet financial guidance or distribution expectations; the ultimate impact of efforts to fight COVID-19 on the global economy and any related impact on commodity demand and prices; our ability to safely and efficiently operate WES's assets; the supply of, demand for, and price of oil, natural gas, NGLs, and related products or services; our ability to meet projected in-service dates for capital-growth projects; construction costs or capital expenditures exceeding estimated or budgeted costs or expenditures and the other factors described in the 'Risk Factors' section of WES's most-recent Form 10-K and Form 10-Q filed with the Securities and Exchange Commission and other public filings and press releases. WES undertakes no obligation to publicly update or revise any forward-looking statements.
Contact:
Kristen Shults
Tel: 832.636.1009
Email: Kristen.Shults@westernmidstream.com
WESTERN MIDSTREAM PARTNERS, LP 
