Summit Midstream Partners (SMLP) 5 May 232023 Q1 Earnings call transcript

Good day, and thank you for standing by. Welcome to the First Quarter 2023 Summit Midstream Partners, LP Earnings Conference Call. [Operator Instructions].

I would now like to hand the conference over to your speaker today, Randall Burton, Director of Investor Relations. Please go ahead.

morning, good and operator, everyone. Thanks,

Deneke, Events already If me earnings find today copy or homepage, our to Bill other a first XXXX please Mault, management Financial along with you it Results Heath our of our Chief our Executive team. visit operating results With financial the you'll Chief discuss don't President, release, and Officer where members senior quarter is our of of www.summitmidstream.com, our and Chairman; section have website section. Presentations and on Quarterly Officer, at

Before They and that of statements. estimates we may objectives also anticipated concerning may plans not start, liquidity, These I'd discussion forward-looking our expenditures. like to, future to include strategy statements volumes, are remind contain and flow, but other limited our for cash you operating statements expenses business operations. include, may future capital today and

in can expectations statements to we expectations forward-looking are believe such that such assurance we reflected reasonable, will correct. no the that be Although prove provide

Please XX-K, from actual the which that our listing cause see factors SEC XXXX, differ X, to filings was on well other as of Form report on March with for SEC could filed expected a XXXX results. results materially annual our as

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

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

Good everyone. Randall. morning, Thanks, Great.

with of in first morning million, this EBITDA our which expectations. line reported Summit internal So $XX.X adjusted was quarter

DJ a resulted were of timing liquids to growth XXXX. the in systems XX and these shut-ins growth well XX% Rockies and Despite volumes the in had over quarter, volume in relative XX% very half gas to Basin quarter-over-quarter during additions new longer-than-anticipated frac-protect some December quarter active As over added which operationally our experiencing new the region. of slippage wells expected, with we

to most the rigs activity but Customer segments. significant throughout continue EBITDA remain year. recent we levels across of expect downward year and currently customers full Shifting expectations. pressure that in behind we delays wells in in uncompleted X over planned and remainder will drilled the expect running systems near-term operating healthy and will our in volume are activity of of beginning on with Barnett XXXX drive to discussions Based the growth our likely some year that our picture. do There on the gas of prices pullbacks Piceance, versus result continued XXX the

sequential are our in changes the largely the guidance and to $XXX million for accounted $XXX strong plans end Williston, in to our customer track continue believe those believe keeps quarterly and original the which year. see particular deliver year. resiliency the lower for overall adjusted we us we shale of In to range our in guidance Utica million growth However, EBITDA achieve those in on DJ XXXX basins, on we original regions. range of for segment

behind connecting year we're significant of system year. operational our this the focus given wells on is execution, number Our this that

Over the acquired optimize and successfully we Basin last DJ to integrated X have continued months, our assets. recently

authorization largest facility in state processing of Basin, Our over the quarter to At and in during additionally, receiving E the to an Red continues day Eddy in construct time on per program Double Basins we Williston in budget. the on DJ complex New Mexico. Red X.XX Hills milestone capital progress plant in Mexico. in lateral And is County important Delaware by to Hills and the the a capacity, Bcf the FERC processing of achieved new processing the

in Red up the Texas delivery to existing firm customers the other area. services and to across hopefully from area in interest marketing ramping the plants -- this whole downstream solicit Waha, transportation to Double We E system provide pipeline complex new summer will points be activities from the and Hills

to off with of to And financial achieve the continue we're start we year. significant see that activity across summary, remain EBITDA we customer in the towards of track about our a and our at results. good beginning So to cadence QX level growth We're and excited we guided systems. the year-over-year operating on the

over hand provide results. that, detail with to our on let So me second the to additional financial call Bill

of system, during proportionate morning, Marcellus system, Gathering the venture Heath, is our the In a Ohio of due million, quarter call. segment primarily our to adjusted feet volumes in and mentioned XXX everyone. X/Xths good of day a inclusive and which the activities quarter, averaged Bcf earlier joint million per and decline volumes the share segment decrease million of Thanks, day from $X.X of XXXX, inclusive our Northeast, frac-protect a $XX.X of OGC in SMU cubic fourth from EBITDA Heath X.X totaled the

feet cubic quarter. and We at net million a at frac-protect approximately OGC and by $X negatively feet volumes cubic million SMLP a estimate SMU gross those margin activities the XX during to XX day approximately day million by impacted

are system in venture expect and brought Five new wholly-owned behind running online. are the XXXX DUCs online second more We OGC rigs SMU our back X SMU wholly-owned were behind wells moderate There of rigs and XX our the wells behind to with the connected the including quarter XX X than existing behind impacts these system, were joint brought new new as currently during systems systems. our these behind wells quarter.

production flat $XX.X expecting Rockies are systems we Our while December. to an activity are to made DJ million primarily our XXXX, adjusted growth the million, basin is Basin levels. segment, of $X.X customers estimate behind hedged. DJ from well due of our fourth remain The some quarter overall of customers' Basin systems, of and its which EBITDA acquisitions increase the XXXX And significant to generated Williston inclusive in relatively

day, volume more behind DUCs and in averaged XX% throughput natural There per growth XXXX a during million the barrels rigs the of of quarter. throughput throughput new representing averaged systems. to XX,XXX volume December volume There gas connected quarter, quarter were during XXX to running a XXX X day relative the Liquids than XXXX. the cubic feet are increase wells approximately relative XX% XX and fourth

The Permian XX% of at venture. includes Double increase Pipeline interest million, adjusted contractual to contracts in joint the due $X.X step-ups an E our EBITDA relative quarter million E XXXX, of segment, $X.X to in the reported take-or-pay primarily which our Double fourth of

million partially production by that recorded offset of X the line turned due primarily relative relative feet fourth adjusted million, of a The to Volumes EBITDA the were of day, March. Piceance from XXX to a million X.X% wells segment averaged decrease quarter volume decrease quarter. fourth a $X.X $XX.X declines, in to natural cubic in

and that There wells expected X have are on this to more pad be line been in turned drilled, site completed month. that same

in As segment mentioned are to guidance adjusted seeing EBITDA but expect earlier, Piceance. some still our customers achieve Heath modest our we in delay development the by

$X EBITDA quarter, feet The of primarily frac-protect to million. adjusted reported EBITDA volumes adjusted $X.X due segment activities $X.X decrease Barnett a declines segment an impacting to X natural million, quarterly and the day of a production by by fourth million cubic estimated and estimated million relative an

gas to the There has EBITDA of now and hold natural expect prices system, customers wells the in or adjusted one line inventory range improve. is slightly adjusted EBITDA running expect until to $XX turn end one trend segment low result toward this still wells We in year, XX below decided million. our $XX which to behind to we and of DUC rig our segment guidance of to million

in EBITDA and a adjusted Quickly $XX CapEx. of net loss of of with $XX.X line $XX.X included recorded on maintenance the the million and quarter expenditures quarter $X approximately totaled for expectations first partnership, million. Capital SMLP million million

during with connections DJ quarter in integration projects. was Basin The Rockies majority of and growth CapEx associated and the pad the

at SMLP's first we billion, have approximately million, totaled the relative of XXXX of approximately of and included balance credit. letters year-end million approximately to total respect $XX sheet, end With the of $X $XXX of debt to net quarter decrease which million a $X.XX liquidity

the remarks. And to closing for over call Heath I'll turn with back that,

All right. Bill. Great. Thanks,

performance. earlier, pleased the said I quarter are As first we with

to takes portfolio, million look to across throughout continue year. the the And operational while been XXXX to we few million continuing expect gives year. adjusted guidance We updates a achieve to forward $XXX the $XXX there provide have to our of EBITDA range for and

to be held will I call at the questions, before up the which for XXXX, on Time. X:XX XX, open of everyone upcoming Partners, wanted May remind I And virtually of Limited Meeting Central p.m. Annual

have important to for received proxy agenda number and your associated should we partnership, unitholders vote. unitholders are support. encourage the All time you to of are There all and the on meeting. continued items a Thank that materials the with

open would with up the call operator, I And for to that, questions. like

[Operator Instructions].

America. of question Brody from Gregg Bank We have a from

your -- and it you Can have the hit you ramp guidance? based maintaining year need you just maintenance guidance you're the throughout of on does like quarter -- that the towards looks to numbers. those -- -- like trending lower Do end the you you're EBITDA to the seem it

sort help through the And maintaining can us you to today? of what of guidance risks are think your some

in and that. some expected as kind line -- expectations I commentary really throughout our and the add on start mean, this as of we Yes. year. with is will off I'll Heath, that of is This activity quarter cadence well. we Bill we the said,

in XXX And of think close our of recall, XX midcoin expected. so. kind first quarter, the you XXX, completed we well those of -- within connects If had guidance the which of I north range, again, maybe was got we was to or as

the looked the will the second those play. first come kind volumes when when kind of have of wells definitely, into definitely at is new it's early and year half those So half majority year, we kind to of the of late of of wells

this based to Barnett, definitely at lower customers segments. particular we we expect to the and we pullback there of that the the end end kind on in kind suggested recent close of the come some Piceance those think I that So while probably with and on discussions point,

connects those of Utica Rockies all segments, all and timing plans. the with in line and the of the -- still producer the original and well level However, timing of cadence of well connects are the

mid. we've bit So -- in and risked quite a the those

low as So we be point. kind on as point, we it within long kind coming the of range. kind And now, as probably would at everything of stays than likely think as we're end the say of midpoint I'd looks think up just right to still the at track we that this guidance

right? frac-protect I'd couple include quarterly are points, to signals, those about Barnett that that impacted wells $X.X had about while frac right? right? And a $XX million more day are down We certainly completing add Gregg, but million just they're great in the results We by means come you highlighted Northeast, That about protect, when a that for online. the

for frac on a think pad you of completing we be data So more months wells and more gives to couple existing in X protect further wouldn't cadence, that just those on they're I the points as than shut expect X or just sites.

I that's good indicator. a leading So think

had I then kind think, time this we was our again, with And quarter. construction line see as -- in CapEx while expectations, of a we decent CapEx line,

indicating I for all and think should be that getting a that's pad up summer. we're nice connected

there. the for just I And one color appreciate last you.

opportunities Is that likely something and So in the balance sense you've What's that changed? year? improving base. asset this opportunities talked your about that potentially we're just sheet see deleveraging today? of the to the Or the has past there

Yes. kind business. right and new organic activity. of we're focus plotting And really new execution base our lot I mean connects our just just a now of think I seeing well is around on

completed you the we're and well a to we overall. market continue all lot in to getting acquisitions, We look DJ as that of finance year kind focused connects under of is I know, opportunities. stuff of can facility happening move rebuilding well on getting to transaction. kind our -- we a we're big good utilize we and credit But to mean, everything at up DJ and that the liquidity we this seeing help that the But DJ

on we're So think is I I into something just opportunity, of think -- I now. but say lots right we imminent certainly, that not not frankly really there's focused that things, always that or would look we're all anything don't and now right

the we you call. now concludes Thank questions And participating, and for conference may that's disconnect. have. all today's This you