Most Viewed Links
 
Crosstex Energy, Inc.
Trades on the NASDAQ Exchange under the symbol XTXI.
Press Release

Printer Friendly Version View printer-friendly version
<< Back
Crosstex Reports Fourth Quarter & Year End 2002 Results

Growth from 2001 to 2002: - Pipeline throughput increased 25% - Natural gas processed increased 41% - Treating plants in operation increased year-over-year from 30 to 35

DALLAS, Mar 25, 2003 /PRNewswire-FirstCall via COMTEX/ -- Crosstex Energy, L.P. (Nasdaq: XTEX), in its first report since the successful completion of its initial public offering, announced continued year-over-year growth in all phases of its business. Gross margins were $8.7 million for the fourth quarter of 2002, compared to $8.1 million in the fourth quarter of 2001. Net income for the quarter was $0.5 million compared to a net loss of $6.6 million for the quarter ended December 31, 2001. The 2001 fourth quarter was negatively impacted by a $5.7 million charge associated with the Enron bankruptcy.

Fourth quarter distributable cash flow was $3.6 million or $0.48 per unit, 2.7 times the requirement for the common units, assuming the 7.3 million limited partnership units and two percent general partner interest were outstanding for the entire quarter, and 0.97 times the distribution requirement for all units. A cap of $1.5 million per quarter on general and administrative expenses charged to the partnership by the general partner will be instituted in 2003. Had that cap been in place for the fourth quarter, pro forma distributable cash flow would have been 1.16 times the distribution requirement for all units, assuming the units were outstanding for the entire quarter.

Deducted from net income in the quarter were the following non-cash items, which were not deducted from distributable cash flow:

    --  $1.0 million of non-cash impairment charges.  These charges relate
        primarily to the write off of intangible assets associated with
        contracts at two treating plants.  The intangible contract values were
        created in conjunction with the accounting for the Yorktown investment
        in the partnership in May 2000.  As these intangible assets were
        associated with the specific contracts in place at the time of the
        Yorktown investment, when the plants were removed from service at that
        location, the contract values were impaired and written off.
    --  $0.7 million of non-cash charges associated with the expiration of the
        remaining puts purchased in the management of the partnership's Enron
        position.  The partnership's Enron position was transferred to
        Crosstex's general partner in conjunction with the initial public
        offering, so there will be no future gain or loss associated with this
        position.

For the year ended December 31, 2002, gross margins were $32.7 million compared to $24.2 million for fiscal 2001. Net income for the year was $2.0 million compared to a net loss in 2001 of $3.9 million. Distributable cash flow for 2002 was $11.8 million compared to $3.1 million in 2001.

Net income for the year was impacted by the following items, which were not considered in the calculation of distributable cash flow:

    --  $4.2 million non-cash impairment charges associated with intangible
        contract values arising from the Yorktown investment as discussed
        above.
    --  $0.9 million in gains associated primarily with management of the
        company's Enron position.  These gains are net of the $0.7 million
        cost of the puts expiring in the fourth quarter as discussed above.
    --  $0.5 million of legal fees and expenses associated with an abandoned
        acquisition transaction.

In 2002, pipeline throughput increased 25%, from 313,103 MMBtu/d to 392,608 MMBtu/d. Natural gas processed increased 41%, from 60,629 MMBtu/d to 85,581 MMBtu/d, and treating plants in operation increased year-over-year from 30 to 35. Revenues for the year were $452 million compared to $387 million for 2001. Crosstex ended 2002 with $22.5 million of debt, and $89.8 million of equity, for a debt to total capitalization ratio of 20%.

"Our growth strategy proved highly successful in 2002," stated Barry E. Davis, President and Chief Executive Officer of Crosstex. "We integrated several key acquisitions, giving us better coverage of the Texas Gulf Coast area and expansion into the Florida market. Since our IPO, we have acquired two new assets that will be significant contributors to our future. We continue to see growth opportunities in the midstream sector."

Crosstex Energy, L.P., a mid-stream natural gas company headquartered in Dallas, operates over 1,700 miles of pipeline, two processing plants, and over 35 natural gas amine treating plants. Crosstex currently provides services for over 700,000 MMBtu/day of natural gas. Crosstex Energy was ranked first in the Mastio & Co. 2002 Producer Purchaser Satisfaction Survey of nearly 400 gas producers. Additional information about Crosstex can be found at www.crosstexenergy.com.

This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included or incorporated herein may constitute forward-looking statements. Although the company believes that the expectations reflected in the forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct.



                    SELECTED FINANCIAL AND OPERATING DATA

                                   (All Dollar Amounts in Thousands)
                            Year Ended Dec. 31,      Quarter Ended Dec. 31,
                            2002          2001         2002          2001

    Revenues
        Midstream         $437,676      $362,673     $126,223       $92,177
        Treating            14,817        24,353        4,186         5,269
                           452,493       387,026      130,409        97,446
    Cost of Gas
        Midstream          413,982       344,755      119,957        86,085
        Treating             5,767        18,078        1,771         3,224
                           419,749       362,833      121,728        89,309
    Gross Margin            32,744        24,193        8,681         8,137

    Operating Expenses      10,468         7,430        2,736         2,435
    General and
     Administrative          8,454         5,914        2,207         1,547
    Impairments              4,175         2,873        1,025         2,873
    (Profit) Loss on
     Energy Trading
     Contracts              (2,703)(A)     3,714          213 (B)     5,241
    Stock Based
     Compensation               41           ---            8           ---
    Depreciation and
     Amortization            7,745         6,101        1,712         1,920
        Total               28,180        26,032        7,901        14,016

    Operating Income         4,564        (1,839)         780        (5,879)

    Interest Expense        (2,717)       (2,253)        (318)         (715)
    Other                      155           174           83            29
        Total Other         (2,562)       (2,079)        (235)         (686)
    Net Income              $2,002       ($3,918)        $545       ($6,565)


           RECONCILIATION OF NET INCOME TO DISTRIBUTABLE CASH FLOW
    Net Income              $2,002       ($3,918)        $545       ($6,565)
    Depreciation and
     Amortization            7,745         6,101        1,712         1,920
    Impairments              4,175         2,873        1,025         2,873
    Non-recurring (Profit)
     Loss on Energy
     Trading Contracts        (922)(A)       ---          752 (B)       ---
    Stock Based
     Compensation               41           ---            8           ---
    Abandoned Merger Cost      489           ---          ---           ---
    Cash Flow               13,530         5,056        4,042        (1,772)

    Maintenance Capital
     Expenditures            1,711         1,922          444           694
    Distributable
     Cash Flow             $11,819        $3,134       $3,598       ($2,466)

    Operating Data
    Pipeline throughput
     (MMBtu/d)             392,608       313,103      390,611       379,905
    Natural gas
     processed (MMBtu/d)    85,581        60,629       82,104        98,770
    Treating volumes
     (MMBtu/d)              97,033        62,782       94,263        77,972

    (A)  Profit on energy trading contracts for the year ended
         December 31, 2002 consists of:
               margins earned on settled contracts in producer services
                activities of $1,781
               and other gains, primarily related to the company's Enron
                position, of $922.
    (B)  Profit on energy trading contracts for the quarter ended
         December 31, 2002 consists of:
               margins earned on settled contracts in producer services
                activities of $539
               and losses of $752, primarily related to the expiration of puts
                associated with Enron.

     Contact:  Barry E. Davis, President and Chief Executive Officer
               William W. Davis, Sr. V.P. and Chief Financial Officer
     Phone:    (214) 953-9500
SOURCE Crosstex Energy, L.P.

CONTACT: Barry E. Davis, President and Chief Executive Officer, or
William W. Davis, Sr. V.P. and Chief Financial Officer, both of Crosstex
Energy, L.P., +1-214-953-9500

URL: http://www.crosstexenergy.com


 
 HomeSite IndexContact UsSafety & Environment