Summit Midstream Partners, LP (NYSE:SMLP) Q3 2018 Earnings Conference Call Transcript

Nov 09, 2018 • 10:00 am ET

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Summit Midstream Partners, LP (NYSE:SMLP) Q3 2018 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Welcome to the Third Quarter 2018 Summit Midstream Partners, LP Earnings Conference Call. My name is Paulette, and I'll be your operator for today's call. At this time all participants are in a listen-only mode. Later we will conduct a question-and-answer session. (Operator Instructions) Please note that this conference is being recorded.

I will now turn it call over to Marc Stratton, Senior Vice President and Treasurer. You may begin.

Executive
Marc Stratton

Thanks, operator and good morning, everyone. Thank you for joining us today to discuss our financial and operating results for the third quarter of 2018. If you don't already have a copy of our earnings release, please visit our website at www.summitmidstream.com, where you'll find it on the Homepage or in the News section.

With me today to discuss our quarterly earnings is Steve Newby, our President and Chief Executive Officer; Matt Harrison, our Chief Financial Officer; Leonard Mallett, our Chief Operations Officer; Brad Graves our Chief Commercial Officer, and Brock Degeyter, our General Counsel.

Before we start, I'd like to remind you that our discussion today may contain forward-looking statements. These statements may include, but are not limited to our estimates of future volumes, operating expenses and capital expenditures. They may also include statements concerning anticipated cash flow, liquidity, business strategy, and other plans and objectives for future operations. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can provide no assurance of such expectations will prove to be correct.

Please see our 2017 Annual Report on Form 10-K, which was filed with the SEC on February 26, 2018, as well as our other SEC filings for a listing of factors that could cause actual results to differ materially from expected results.

Please also note that on this call we use the terms EBITDA, adjusted EBITDA and distributable cash flow. These are non-GAAP financial measures and we have provided reconciliations to the most directly comparable GAAP measures in our most recent earnings release.

And with that, I'll turn the call over to Steve Newby.

Executive
Steven J. Newby

Thanks, Marc. Good morning everyone and thanks for joining us on the call this morning. As usual I'll begin with a few comments on the quarter and I'll turn it over to Matt for more detail on our quarterly financial results. I'll then wrap up the call by giving an update on our Double E project and discussing our preliminary outlook for 2019.

Yesterday, we announced our operational and financial results for the third quarter. Adjusted EBITDA in the third quarter totaled $73.4 million, which was in line with both the prior-year period and the second quarter of 2018 results. We are on track to hit our 2018 adjusted EBITDA guidance of $285 million to $300 million.

Distributable cash flow in the third quarter was $43.6 million, which led to a distribution coverage ratio of 0.96 times. We had a pretty full maintenance CapEx spend in the quarter, totaling more than $6.4 million, which impacted quarterly distribution coverage. The higher maintenance