Third Quarter 2018 Earnings Call November 1, 2018 www.nblmidstream.com
Forward Looking Statements This presentation contains certain “forward -looking statements” within the meaning of federal securities law. Words such as “anticipates”, “believes”, “expects”, “intends”, “will”, “should”, “may”, “estimates”, and similar expressions may be used to identify forward-looking statements. Forward-looking statements are not statements of historical fact and reflect Noble Midstream Partners LP’s (Noble Midstream or the Partnership) current views about future events. No assurances can be given that the forward-looking statements contained in this presentation will occur as projected and actual results may differ materially from those projected. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks and uncertainties that could cause actual results to differ materially from those projected. These risks include, without limitation, our customers’ ability to meet their drilling and development plans, changes in general economic conditions, competitive conditions in the Partnership’s industry, actions taken by third-party operators, gatherers, processors and transporters, the demand for crude oil and natural gas gathering and processing services, the Partnership’s ability to successfully implement its business plan, the Partnership’s ability to complete internal growth projects on time and on budget, the price and availability of debt and equity financing, the availability and price of crude oil and natural gas to the consumer compared to the price of alternative and competing fuels, and other risks inherent in the Partnership’s business, including those described under “Risk Factors” and “Forward -Looking Statements” in the Partnership's most recent Annual Report on Form 10-K and in other reports on we file with the Securities and Exchange Commission (SEC). These reports are also available from the Partnership’s office or website, www.nblmidstream.com. Forward-looking statements are based on the estimates and opinions of management at the time the statements are made. Noble Midstream does not assume any obligation to update forward-looking statements should circumstances, management’s estimates, or opinions change. This presentation also contains certain non-GAAP measures of financial performance that management believes are good tools for internal use and the investment community in evaluating Noble Midstream’s overall financial performance. Please see slides 25 and 26 for reconciliations of the non-GAAP financial measures used in this presentation to the most directly comparable GAAP financial measures. www.nblmidstream.com 2
3Q18 Highlights ▪ In-line or Exceeded Guidance Across All Categories ▪ Net Income and Net Adjusted EBITDA ¹ , 3 above guidance ▪ Delivered Strong Throughput Growth Across All Segments ▪ Combined oil, gas and produced water gathering and sales volume up 25% from 2Q18 ▪ Fresh water delivery volumes up 22% sequentially ▪ Capital Focused on Efficient Well Connects, With Major Projects Complete ▪ 3Q18 net capital down 44% from 2Q18 ▪ Continued Peer-leading Distribution Growth/Coverage and Financial Strength ▪ 20% DPU increase over 3Q17, 2.1x Distribution Coverage Ratio ¹ , 2.3x Annualized Leverage Ratio ² ▪ Incremental Commercial and Business Development Success ▪ Additional progress towards goal of 50% net EBITDA ¹ contribution from the Permian Basin by the end of 2020 1. Figures are Non-GAAP; see definition in Appendix hereto 2. Figures are Non-GAAP; Annualized leverage defined as 3Q Debt / (3Q EBITDA * 4) $549 million /( $59 million *4) 3. Net Adjusted EBITDA is Adjusted EBITDA attributable to the Partnership www.nblmidstream.com 3
Third Quarter 2018 Results In-line or exceeding guidance across all categories 3Q Actuals Guidance 3Q v 2Q 1Q18 ¹ 2Q18 3Q18 ✓ Oil Gathered (MBbl/d) ² 135 158 183 165 - 180 16% Gross Volumes ✓ Gas Gathered (MMcf/d) 191 206 249 210 - 230 21% ✓ MBoe/d ² 167 192 225 210 - 218 17% ✓ PW Gathered (MBw/d) 47 86 122 100 - 115 41% ✓ FW Delivered (MBw/d) 168 160 195 190 - 230 22% ✓ Net Income ($MM) 39 44 49 43 - 47 11% ✓ Financials ($MM) Gross Adjusted EBITDA ($MM) ³ 58 64 71 65 - 70 11% ✓ Net Adjusted EBITDA ($MM) 3,4 54 49 59 55 - 59 20% ✓ DCF ($MM) ³ 47 40 49 46 - 50 23% ✓ Distribution Coverage Ratio ³ 2.3x 1.8x 2.1x 1.9x - 2.1x ✓ Gross Capex ($MM) ⁵ 249 155 79 71 - 80 ✓ Net Capex ($MM) ⁵ 128 71 40 40 - 50 1. Black Diamond Gathering contribution included for period following January 31, 2018 close 2. Includes crude oil sales volumes 3. Figures are Non-GAAP, see definition provided in appendix hereto 4. “Net Adjusted EBITDA” is Adjusted EBITDA attributable to the partnership 5. Excludes acquisition capital www.nblmidstream.com 4
Robust Fundamentals Across Both Delaware and DJ Basins DJ Basin Oil, Gas and Water Gathering and Sales Throughput Delaware Basin Oil, Gas and Water Gathering and Sales Throughput* (MBoew/d) (MBoew/d) 135 212 140 220 120 200 191 87 100 180 167 80 160 60 45 39 132 140 40 12 120 110 20 +92% +55% +18% +15% +11% +210% +26% +21% 0 100 3Q17 4Q17 1Q18 2Q18 3Q18 3Q17 4Q17 1Q18 2Q18 3Q18 DJ Basin Highlights Delaware Basin Highlights • Oil, Gas and Produced Water Gathering and Sales • Oil, Gas and Produced Water Gathering Throughput Throughput Increased 11% Over 2Q Increased 55% Over 2Q Additional activity timed with start-up of basin Connected initial third-party well for infield oil, ▪ ▪ incremental processing and gas offload capacity gas, & water gathering (~13,000 dedicated acres) • LOI with Salt Creek Midstream, LLC (SCM) for 50/50 Joint Development of Delaware Basin Crude Oil • Significant Contribution from Mustang IDP Oil, Gas and Gathering and Transportation System Produced Water Gathering at Green River DevCo Enhances customer market optionality with route ▪ to Wink • Strong Growth at Black Diamond Gathering • Advantage Pipeline Capacity Expansion to 200 MBbl/d 3Q18 throughput up 23% over 2Q18 and 29% from ▪ from 150 MBbl/d Completed in July time of acquisition close Long-term contract to service facilities for a major ▪ producer with ~20,000 acres in Delaware Basin * Note: Excludes Advantage Pipeline Throughput www.nblmidstream.com 5
Peer-Leading Distribution Coverage 1 Continues Conservative distribution policy supported by solid gathering segment contribution Gathering Segment Alone Provides Ample Distribution Coverage ¹ ▪ 1.4x Distribution Coverage Ratio ¹ excluding Fresh Water ▪ Gathering Segment Represented Approximately 75% of 3Q18 Net Adjusted EBITDA ¹ ▪ Full-Year 2018 Guidance: 20% Distribution Growth with Distribution Coverage Ratio 1 of 2.0x – ▪ 2.1x Distribution Coverage Ratio 1,3 & DPU 3Q 2018 NBLX Net Adjusted EBITDA and Distribution Coverage 1,2 2.1x 4.5x 2.5x $ in millions $2.19 4.x 1.4x $1.81 2.x 3.5x 3.x 1.5x 2.5x 2.0x - 2.1x 2.1x Implied Distribution 59 x Coverage of 3Q 2.x 1.x Distribution 44 1.5x Total Adjusted EBITDA 1.x Fresh Water Delivery .5x EBITDA .5x Gathering EBITDA .x .x FY2017 FY2018 Gathering Adjusted EBITDA Column1 Total Adjusted EBITDA 1. Figures are Non-GAAP; see definition in Appendix hereto 2. G&A allocated to gathering and freshwater delivery based on proportionate share of adjusted EBITDA; coverage figures reflect full net maintenance capital totals 3. Assumes 20% distribution growth target www.nblmidstream.com 6
Fourth Quarter 2018 Guidance Gross Fresh Water Delivery ( MBw/d) 180-220 195 ▪ 4Q18E Net Income of $52-$57 MM 168 160 ▪ Anticipate Oil and Gas Gathering Gross Throughput Growth in 4Q18E Over 3Q18 Driven by Green River and Laramie River DevCos ▪ Expect Flat to Modest Growth in Produced Water Gathering Across DevCos in 4Q18E Over 3Q18 1Q18 2Q18 3Q18 4Q18E ▪ Fresh Water Delivery Volumes Anticipated to Gross Produced Water Gathering ( MBw/d) 130-145 Increase 3% Sequentially at Guidance Midpoint 122 ▪ 4 crews running on dedicated acreage in 86 4Q18E versus 5 in 3Q18 47 Net Adjusted EBITDA ¹ ($MM) 1Q18 2Q18 3Q18 4Q18E 57-62 Gross Oil and Gas Gathering and Sales ² ( MBoe/d) 59 60 300 58 241-259 56 54 225 250 54 192 52 200 167 49 50 150 48 46 100 44 42 50 40 0 1Q18 2Q18 3Q18 4Q18E 1Q18 2Q18 3Q18 4Q18E 1. Figures are Non-GAAP; see definition in Appendix hereto 2. Includes crude oil sales www.nblmidstream.com 7
Updated 2018 Capital Budget Detail Material Decline in 2H18E Net Capital 128 130 Requirements ($MM) 3Q18 Gross Capital at High-end While Net Capital ▪ 110 at Low-end of Guidance Higher Blanco River and Green River infrastructure 90 ▪ 71 capital 70 Lowered High-end of 2018E Net Capital Guidance 50 40 ▪ 31-36 by 4% 30 10 Capital Focused on Efficient Well Connects ▪ -10 1Q18 2Q18 3Q18 4Q18E Gross Capital 1 Net Capital 1 Colorado (attributable to the Partnership) River Trinity River 2% 5% Colorado Laramie River Trinity River River ² 4% 11% 24% Laramie River ² 34% Blanco River $538 - 550 51% $270- 275 MM MM Blanco River Green River 41% 17% Green River 9% Other 1. Excludes acquisition capital Other, 0% 2. Includes Black Diamond Gathering capital 1% www.nblmidstream.com 8
Recommend
More recommend
