Altus Midstream Company (NASDAQ:ALTM) Q2 2020 Earnings Conference Call - Final Transcript

Jul 30, 2020 • 02:00 pm ET


Altus Midstream Company (NASDAQ:ALTM) Q2 2020 Earnings Conference Call - Final Transcript


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Ben Rodgers

2020, given the priority to project level finance. Growth capital guidance is unchanged at this time. We expect capital investments in our G&P business to be de minimis for the remainder of the year, with the majority of capital in the second half of the year being directed towards PHP. As we've done in the past, our guidance reflects our gross proportionate share of capital without taking project finance into account. EPIC crude is the only JV pipeline that has project level financing, and the upside of that debt has funded a portion of the project's capital overruns. Therefore, we expect our share of funding will be lower than the gross proportionate share we have outlined. As Clay noted, PHP remains on schedule for an early 2021 in-service date, which was recently confirmed on Kinder Morgan's second quarter earnings call.

With the start-up of PHP, all four of our JV pipeline projects will be in service and contributing to Altus' results. In the investor presentation posted on our website last night, we included our revised outlook for 2021, providing guidance on selected key items. Of note, our adjusted EBITDA is currently expected to range from $220 million to $260 million, which at the midpoint represents an approximate 40% increase compared with 2020. 2021 distributable cash flow is anticipated to increase to a range of $150 million to $180 million, with the strong year-over-year growth driven by PHP entering service. And our growth capital investments are ramping down significantly. 2021 growth capex is expected to be $30 million to $50 million, most of which is attributable to assumed completion PHP in the first quarter. This guidance does not include any volume, growth capital or cash flow estimates from new third-party business and will be revised as necessary when it's acquired. As with other companies in the energy space, Altus' stock price has been severely impacted by the reduced demand for hydrocarbon products. In May, our shareholders approved a one for 20 reverse stock split in order to comply with NASDAQ minimum price listing rules, and this was implemented at the end of June. In closing, I'd like to echo Clay's comments recognizing our team in overcoming today's challenging environment. We are making steady progress, and these efforts are contributing to an improving outlook for Altus Midstream.

I will now turn the call over to the operator for Q&A.