Form 8-K - Current report

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 

FORM 8-K

 

 

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

 

Date of report (Date of earliest event reported): July 31, 2024

 

 

 

ANTERO MIDSTREAM CORPORATION

(Exact name of registrant as specified in its charter)

 

 

 

Delaware		001-38075		61-1748605
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification Number)

 

1615 Wynkoop Street

Denver, Colorado 80202

(Address of Principal Executive Offices) (Zip Code)

 

Registrant’s Telephone Number, Including Area Code [phone]

 

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.01 Per Share		AM		New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company  ¨

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ¨

 

 

 

 

 

Item 2.02

Results of Operations and Financial Condition

 

 On July 31, 2024, Antero Midstream Corporation issued a press release, a copy of which is attached hereto as Exhibit 99.1 and incorporated by reference herein, announcing its financial and operational results for the quarter ended June 30, 2024.

 

The information in this Current Report, including Exhibit 99.1, is being furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liabilities of that section, and is not incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act unless specifically identified therein as being incorporated therein by reference.

 

Item 9.01

Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit Number		Description
99.1		Antero Midstream Corporation press release dated July 31, 2024.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

2

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	ANTERO MIDSTREAM CORPORATION
	By:	/s/ Brendan E. Krueger
		Brendan E. Krueger
		Chief Financial Officer, Vice President –Finance and Treasurer
Dated: July 31, 2024

 

3

 

 

Exhibit 99.1

 

 

Antero Midstream Announces Second Quarter 2024 Financial and Operating Results

 

Denver, Colorado, July 31, 2024—Antero Midstream Corporation (NYSE: AM) (“Antero Midstream” or the “Company”) today announced its second quarter 2024 financial and operating results. The relevant unaudited condensed consolidated financial statements are included in Antero Midstream’s Quarterly Report on Form 10-Q for the three months ended June 30, 2024.

 

Second Quarter 2024 Highlights:

 

	·	Net Income was $86 million, or $0.18 per diluted share, in line with the prior year quarter on a per share basis
	·	Adjusted Net Income was $110 million, or $0.23 per diluted share, a 5% per share increase compared to the prior year quarter (non-GAAP measure)
	·	Adjusted EBITDA was $255 million, a 5% increase compared to the prior year quarter (non-GAAP measure)
	·	Capital expenditures were $51 million
	·	Free Cash Flow after dividends was $43 million, a 41% increase compared to the prior year quarter (non-GAAP measure)
	·	Acquired bolt-on Marcellus gathering and compression assets for $70 million
	·	Maintained Leverage of 3.1x as of June 30, 2024 (non-GAAP measure)
	·	Received an upgrade on corporate and issuer credit ratings to BB+ from S&P Global Ratings
	·	Extended credit facility maturity to 2029 and maintained commitments of $1.25 billion

 

Paul Rady, Chairman and CEO said, “During the quarter, Antero Midstream closed on a highly strategic bolt-on acquisition, increasing throughput volumes from our primary investment grade customer, Antero Resources. This acquisition complements our organic just-in-time business model that generates consistent Free Cash Flow after dividends, which increased 41% year-over-year.”

 

Brendan Krueger, CFO of Antero Midstream, said “During 2024, Antero Midstream improved its balance sheet through the successful refinancing of its highest coupon senior notes and the extension of its credit facility to 2029. Importantly, over the last year, we have reduced our net debt by $120 million and our leverage has declined from 3.5x to 3.1x. This balance sheet improvement is evidenced by our upgrade from S&P and highlights our consistent Free Cash Flow generation and the accretive nature of the recent bolt-on acquisition.”

 

For a discussion of the non-GAAP financial measures, including Adjusted EBITDA, Adjusted Net Income, Leverage, Free Cash Flow after dividends, and Net Debt see “Non-GAAP Financial Measures.”

 

 

 

 

Second Quarter 2024 Financial Results

 

Antero Midstream’s second quarter financial and operating results include two months of contribution from the compression and high pressure gathering assets located in Antero Midstream’s core West Virginia Marcellus Shale position acquired from Summit Midstream Partners, LP.

 

Low pressure gathering volumes for the second quarter of 2024 averaged 3,258 MMcf/d, a 1% decrease as compared to the prior year quarter. Compression volumes for the second quarter of 2024 averaged 3,246 MMcf/d, in line with the prior year quarter. High pressure gathering volumes averaged 2,994 MMcf/d, a 2% increase compared to the prior year quarter. Fresh water delivery volumes averaged 81 MBbl/d during the quarter, a 23% decrease compared to the second quarter of 2023. The reduction in fresh water delivery volumes was driven by the previously announced reduction by Antero Resources to one completion crew in early 2024, resulting in fewer completion stages in the second quarter.

 

Gross processing volumes from the processing and fractionation joint venture with MPLX, LP (the “Joint Venture”) averaged 1,588 MMcf/d for the second quarter of 2024, a 1% decrease compared to the prior year quarter. Joint Venture processing capacity was 99% utilized during the quarter based on nameplate processing capacity of 1.6 Bcf/d. Gross Joint Venture fractionation volumes averaged 40 MBbl/d, a 3% increase compared to the prior year quarter. Joint Venture fractionation capacity was 100% utilized during the quarter based on nameplate fractionation capacity of 40 MBbl/d.

 

			Three Months Ended June 30,								%
	Average Daily Volumes:		2023				2024				Change
	Low Pressure Gathering (MMcf/d)			3,304				3,258				(1	)%
	Compression (MMcf/d)			3,251				3,246				—
	High Pressure Gathering (MMcf/d)			2,922				2,994				2	%
	Fresh Water Delivery (MBbl/d)			105				81				(23	)%
	Gross Joint Venture Processing (MMcf/d)			1,600				1,588				(1	)%
	Gross Joint Venture Fractionation (MBbl/d)			39				40				3	%

 

For the three months ended June 30, 2024, revenues were $270 million, comprised of $229 million from the Gathering and Processing segment and $59 million from the Water Handling segment, net of $18 million of amortization of customer relationships. Water Handling revenues include $27 million from wastewater handling and high rate water transfer services.

 

Direct operating expenses for the Gathering and Processing and Water Handling segments were $26 million and $30 million, respectively, for a total of $56 million. Water Handling operating expenses include $24 million from wastewater handling and high rate water transfer services. General and administrative expenses excluding equity-based compensation were $10 million during the second quarter of 2024. Total operating expenses during the second quarter of 2024 included $12 million of equity-based compensation expense and $38 million of depreciation.

 

Net Income was $86 million, or $0.18 per diluted share, in line with the prior year quarter. Net Income adjusted for amortization of customer relationships, loss on early extinguishment of debt, loss on settlement of asset retirement obligation and loss on asset sale, net of tax effects of reconciling items, or Adjusted Net Income, was $110 million. Adjusted Net Income was $0.23 per diluted share, a 5% per share increase compared to the prior year quarter.

 

The following table reconciles Net Income to Adjusted Net Income (in thousands):

 

		Three Months Ended June 30,
		2023				2024
Net Income		$	87,012				86,037
Amortization of customer relationships			17,668				17,668
Loss on early extinguishment of debt			—				13,691
Loss on settlement of asset retirement obligations			279				—
Loss on asset sale			5,814				1,379
Tax effect of reconciling items(1)			(6,109	)			(8,430	)
Adjusted Net Income		$	104,664				110,345

 

(1) The statutory tax rates for the three months ended June 30, 2023 and 2024 were 25.7% and 25.8%, respectively.

 

 

 

 

Adjusted EBITDA was $255 million, a 5% increase compared to the prior year quarter. Interest expense was $52 million, a 6% decrease compared to the prior year quarter, driven primarily by lower average total debt. Capital expenditures were $51 million. Free Cash Flow before dividends was $152 million, a 9% increase compared to the prior year quarter. Free Cash Flow after dividends was $43 million, a 41% increase compared to the prior year quarter.

 

The following table reconciles Net Income to Adjusted EBITDA and Free Cash Flow before and after dividends (in thousands):

 

		Three Months Ended June 30,
		2023				2024
Net Income		$	87,012				86,037
Interest expense, net			55,388				52,186
Income tax expense			29,095				28,436
Depreciation expense			35,233				37,576
Amortization of customer relationships			17,668				17,668
Loss on asset sale			5,814				1,379
Accretion of asset retirement obligations			44				47
Loss on settlement of asset retirement obligations			279				—
Loss on early extinguishment of debt			—				13,691
Equity-based compensation			8,499				11,599
Equity in earnings of unconsolidated affiliates			(25,972	)			(27,597	)
Distributions from unconsolidated affiliates			29,465				33,970
Adjusted EBITDA		$	242,525				254,992
Interest expense, net			(55,388	)			(52,186	)
Capital expenditures (accrual-based)			(48,584	)			(51,276	)
Free Cash Flow before dividends		$	138,553				151,530
Dividends declared (accrual-based)			(107,927	)			(108,284	)
Free Cash Flow after dividends		$	30,626				43,246

 

The following table reconciles net cash provided by operating activities to Free Cash Flow before and after dividends (in thousands):

 

		Three Months Ended June 30,
		2023				2024
Net cash provided by operating activities		$	185,586				215,806
Amortization of deferred financing costs			(1,483	)			(1,495	)
Settlement of asset retirement obligations			537				250
Changes in working capital			2,497				(11,755	)
Capital expenditures (accrual-based)			(48,584	)			(51,276	)
Free Cash Flow before dividends		$	138,553				151,530
Dividends declared (accrual-based)			(107,927	)			(108,284	)
Free Cash Flow after dividends		$	30,626				43,246

 

Second Quarter 2024 Operating Update

 

During the second quarter of 2024, Antero Midstream connected 11 wells to its gathering system and serviced 19 wells with its fresh water delivery system.

 

 

 

 

Capital Investments

 

Capital expenditures were $51 million during the second quarter of 2024. The Company invested $41 million in gathering and compression and $10 million in water infrastructure.

 

2023 ESG Report

 

On July 31, 2024, Antero Midstream published its 2023 ESG Report, marking the Company's 7th year reporting on its environmental, social and governance (ESG) performance. This year’s report highlights the Company’s emissions reduction progress, significant local economic impacts, increased water recycling rate, and continued commitment to safety across our operations and can be found at www.anteromidstream.com/esg.

 

Conference Call

 

A conference call is scheduled on Thursday, August 1, 2024 at 10:00 am MT to discuss the financial and operational results. A brief Q&A session for security analysts will immediately follow the discussion of the results. To participate in the call, dial in at 877-407-9126 (U.S.), or 201-493-6751 (International) and reference “Antero Midstream.” A telephone replay of the call will be available until Thursday, August 8, 2024 at 10:00 am MT at 877-660-6853 (U.S.) or 201-612-7415 (International) using the conference ID: 13743657. To access the live webcast and view the related earnings conference call presentation, visit Antero Midstream's website at www.anteromidstream.com. The webcast will be archived for replay until Thursday, August 8, 2024 at 10:00 am MT.

 

Presentation

 

An updated presentation will be posted to the Company's website before the conference call. The presentation can be found at www.anteromidstream.com on the homepage. Information on the Company's website does not constitute a portion of, and is not incorporated by reference into this press release.

 

Non-GAAP Financial Measures and Definitions

 

Antero Midstream uses certain non-GAAP financial measures. Antero Midstream defines Adjusted Net Income as Net Income plus amortization of customer relationships, loss on early extinguishment of debt, loss on settlement of asset retirement obligations and loss on asset sale, net of tax effect of reconciling items. Antero Midstream uses Adjusted Net Income to assess the operating performance of its assets. Antero Midstream defines Adjusted EBITDA as Net Income plus net interest expense, income tax expense, depreciation expense, amortization of customer relationships, loss on early extinguishment of debt, loss on asset sale, accretion of asset retirement obligations, impairment of property and equipment, loss on settlement of asset retirement obligations, and equity-based compensation expense, excluding equity in earnings of unconsolidated affiliates, plus distributions from unconsolidated affiliates.

 

Antero Midstream uses Adjusted EBITDA to assess:

 

	·	the financial performance of Antero Midstream’s assets, without regard to financing methods, capital structure or historical cost basis;
	·	its operating performance and return on capital as compared to other publicly traded companies in the midstream energy sector, without regard to financing or capital structure; and
	·	the viability of acquisitions and other capital expenditure projects.

 

Antero Midstream defines Free Cash Flow before dividends as Adjusted EBITDA less net interest expense and accrual-based capital expenditures. Capital expenditures include additions to gathering systems and facilities, additions to water handling systems, and investments in unconsolidated affiliates. Capital expenditures exclude acquisitions. Free Cash Flow after dividends is defined as Free Cash Flow before dividends less accrual-based dividends declared for the quarter. Antero Midstream uses Free Cash Flow before and after dividends as a performance metric to compare the cash generating performance of Antero Midstream from period to period.

 

Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow before and after dividends are non-GAAP financial measures. The GAAP measure most directly comparable to these measures is Net Income. Such non-GAAP financial measures should not be considered as alternatives to the GAAP measures of Net Income and cash flows provided by (used in) operating activities. The presentations of such measures are not made in accordance with GAAP and have important limitations as analytical tools because they include some, but not all, items that affect Net Income and cash flows provided by (used in) operating activities. You should not consider any or all such measures in isolation or as a substitute for analyses of results as reported under GAAP. Antero Midstream’s definitions of such measures may not be comparable to similarly titled measures of other companies.

 

 

 

 

The following table reconciles cash paid for capital expenditures and accrued capital expenditures during the period (in thousands):

 

		Three Months Ended June 30,
		2023				2024
Capital expenditures (as reported on a cash basis)		$	42,044				43,399
Change in accrued capital costs			6,540				7,877
Capital expenditures (accrual basis)		$	48,584				51,276

 

Antero Midstream defines Net Debt as consolidated total debt, excluding unamortized debt premiums and debt issuance costs, less cash and cash equivalents. Antero Midstream views Net Debt as an important indicator in evaluating Antero Midstream’s financial leverage. Antero Midstream defines leverage as Net Debt divided by Adjusted EBITDA for the last twelve months. The GAAP measure most directly comparable to Net Debt is total debt, excluding unamortized debt premiums and debt issuance costs.

 

The following table reconciles consolidated total debt to consolidated net debt, excluding debt premiums and issuance costs, (“Net Debt”) as used in this release (in thousands):

 

		June 30, 2024
Bank credit facility		$	555,700
5.75% senior notes due 2027			650,000
5.75% senior notes due 2028			650,000
5.375% senior notes due 2029			750,000
6.625% senior notes due 2032			600,000
Consolidated total debt		$	3,205,700
Less: Cash and cash equivalents			—
Consolidated net debt		$	3,205,700

 

The following table reconciles Net Income to Adjusted EBITDA for the last twelve months as used in this release (in thousands):

 

		Twelve Months Ended June 30, 2024
Net Income		$	388,230
Interest expense, net			212,727
Income tax expense			132,446
Depreciation expense			140,301
Amortization of customer relationships			70,672
Accretion of asset retirement obligations			180
Impairment of property and equipment			146
Equity-based compensation			37,706
Equity in earnings of unconsolidated affiliates			(110,155	)
Distributions from unconsolidated affiliates			137,195
Loss on early extinguishment of debt			13,750
Loss on settlement of asset retirement obligations			185
Loss on asset sale			1,840
Adjusted EBITDA		$	1,025,223

 

 

 

 

Antero Midstream Corporation is a Delaware corporation that owns, operates and develops midstream gathering, compression, processing and fractionation assets located in the Appalachian Basin, as well as integrated water assets that primarily service Antero Resources Corporation’s (NYSE: AR) (“Antero Resources”) properties.

 

This release includes "forward-looking statements.” Such forward-looking statements are subject to a number of risks and uncertainties, many of which are not under Antero Midstream’s control. All statements, except for statements of historical fact, made in this release regarding activities, events or developments Antero Midstream expects, believes or anticipates will or may occur in the future, such as statements regarding our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management, NGL and oil prices, impacts of geopolitical and world health events, Antero Midstream’s ability to execute its share repurchase program, Antero Midstream’s ability to realize the benefits of the Marcellus bolt-on acquisition, including the anticipated capital avoidance and synergies, Antero Midstream’s ability to execute its business plan and return capital to its stockholders, information regarding Antero Midstream’s return of capital policy, information regarding long-term financial and operating outlooks for Antero Midstream and Antero Resources, information regarding Antero Resources’ expected future growth and its ability to meet its drilling and development plan and the participation level of Antero Resources’ drilling partner, the impact on demand for Antero Midstream’s services as a result of incremental production by Antero Resources, and expectations regarding the amount and timing of litigation awards are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All forward-looking statements speak only as of the date of this release. Although Antero Midstream believes that the plans, intentions and expectations reflected in or suggested by the forward-looking statements are reasonable, there is no assurance that these plans, intentions or expectations will be achieved. Therefore, actual outcomes and results could materially differ from what is expressed, implied or forecast in such statements. Except as required by law, Antero Midstream expressly disclaims any obligation to and does not intend to publicly update or revise any forward-looking statements.

 

Antero Midstream cautions you that these forward-looking statements are subject to all of the risks and uncertainties incident to our business, most of which are difficult to predict and many of which are beyond Antero Midstream’s control. These risks include, but are not limited to, commodity price volatility, inflation, supply chain or other disruptions, environmental risks, Antero Resources’ drilling and completion and other operating risks, regulatory changes or changes in law, the uncertainty inherent in projecting Antero Resources’ future rates of production, cash flows and access to capital, the timing of development expenditures, impacts of world health events, cybersecurity risks, the state of markets for and availability of verified quality carbon offsets and the other risks described under the heading "Item 1A. Risk Factors" in Antero Midstream's Annual Report on Form 10-K for the year ended December 31, 2023 and Quarterly Report on Form 10-Q for the three months ended June 30, 2024.

 

For more information, contact Justin Agnew, Vice President – Finance and Investor Relations of Antero Midstream, at [phone] or [e-mail].

 

 

 

 

ANTERO MIDSTREAM CORPORATION

Condensed Consolidated Balance Sheets

(In thousands, except per share amounts)

 

						(Unaudited)
		December 31,				June 30,
		2023				2024
Assets
Current assets:
Cash and cash equivalents		$	66				—
Accounts receivable–Antero Resources			88,610				101,251
Accounts receivable–third party			952				1,384
Other current assets			1,500				963
Total current assets			91,128				103,598
Property and equipment, net			3,793,523				3,868,885
Investments in unconsolidated affiliates			626,650				612,847
Customer relationships			1,215,431				1,180,095
Other assets, net			10,886				9,542
Total assets		$	5,737,618				5,774,967
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable–Antero Resources		$	4,457				3,816
Accounts payable–third party			10,499				15,058
Accrued liabilities			80,630				96,202
Other current liabilities			831				893
Total current liabilities			96,417				115,969
Long-term liabilities:
Long-term debt			3,213,216				3,186,577
Deferred income tax liability, net			265,879				330,802
Other			10,375				14,531
Total liabilities			3,585,887				3,647,879
Stockholders' equity:
Preferred stock, $0.01 par value: 100,000 authorized as of December 31, 2023 and June 30, 2024
Series A non-voting perpetual preferred stock; 12 designated and 10 issued and outstanding as of December 31, 2023 and June 30, 2024			—				—
Common stock, $0.01 par value; 2,000,000 authorized; 479,713 and 481,243 issued and outstanding as of December 31, 2023 and June 30, 2024, respectively			4,797				4,812
Additional paid-in capital			2,046,487				2,036,239
Retained earnings			100,447				86,037
Total stockholders' equity			2,151,731				2,127,088
Total liabilities and stockholders' equity		$	5,737,618				5,774,967

 

 

 

 

ANTERO MIDSTREAM CORPORATION

Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited)

(In thousands, except per share amounts)

 

		Three Months Ended June 30,
		2023				2024
Revenue:
Gathering and compression–Antero Resources		$	211,068				228,993
Water handling–Antero Resources			64,613				58,056
Water handling–third party			274				414
Amortization of customer relationships			(17,668	)			(17,668	)
Total revenue			258,287				269,795
Operating expenses:
Direct operating			52,595				56,409
General and administrative (including $8,499 and $11,599 of equity-based compensation in 2023 and 2024, respectively)			18,162				21,219
Facility idling			637				412
Depreciation			35,233				37,576
Accretion of asset retirement obligations			44				47
Loss on settlement of asset retirement obligations			279				—
Loss on asset sale			5,814				1,379
Total operating expenses			112,764				117,042
Operating income			145,523				152,753
Other income (expense):
Interest expense, net			(55,388	)			(52,186	)
Equity in earnings of unconsolidated affiliates			25,972				27,597
Loss on early extinguishment of debt			—				(13,691	)
Total other expense			(29,416	)			(38,280	)
Income before income taxes			116,107				114,473
Income tax expense			(29,095	)			(28,436	)
Net income and comprehensive income		$	87,012				86,037
Net income per common share–basic		$	0.18				0.18
Net income per common share–diluted		$	0.18				0.18
Weighted average common shares outstanding:
Basic			479,502				481,103
Diluted			481,512				484,778

 

 

 

 

ANTERO MIDSTREAM CORPORATION

Selected Operating Data (Unaudited)

 

										Amount of
		Three Months Ended June 30,								Increase				Percentage
		2023				2024				or Decrease				Change
Operating Data:
Gathering—low pressure (MMcf)			300,706				296,489				(4,217	)			(1	)%
Compression (MMcf)			295,801				295,400				(401	)			*
Gathering—high pressure (MMcf)			265,890				272,447				6,557				2	%
Fresh water delivery (MBbl)			9,585				7,362				(2,223	)			(23	)%
Other fluid handling (MBbl)			4,953				5,144				191				4	%
Wells serviced by fresh water delivery			23				19				(4	)			(17	)%
Gathering—low pressure (MMcf/d)			3,304				3,258				(46	)			(1	)%
Compression (MMcf/d)			3,251				3,246				(5	)			*
Gathering—high pressure (MMcf/d)			2,922				2,994				72				2	%
Fresh water delivery (MBbl/d)			105				81				(24	)			(23	)%
Other fluid handling (MBbl/d)			54				57				3				6	%
Average Realized Fees(1):
Average gathering—low pressure fee ($/Mcf)		$	0.35				0.36				0.01				3	%
Average compression fee ($/Mcf)		$	0.21				0.21				—				*
Average gathering—high pressure fee ($/Mcf)		$	0.21				0.22				0.01				5	%
Average fresh water delivery fee ($/Bbl)		$	4.21				4.31				0.10				2	%
Joint Venture Operating Data:
Processing—Joint Venture (MMcf)			145,645				144,520				(1,125	)			(1	)%
Fractionation—Joint Venture (MBbl)			3,553				3,640				87				2	%
Processing—Joint Venture (MMcf/d)			1,600				1,588				(12	)			(1	)%
Fractionation—Joint Venture (MBbl/d)			39				40				1				3	%

 

 

	*	Not meaningful or applicable.
	(1)	The average realized fees for the three months ended June 30, 2024 include annual CPI-based adjustments of approximately 1.6%.

 

 

 

 

ANTERO MIDSTREAM CORPORATION

Condensed Consolidated Results of Segment Operations (Unaudited)

(In thousands)

 

		Three Months Ended June 30, 2024
		Gathering and				Water								Consolidated
		Processing				Handling				Unallocated				Total
Revenues:
Revenue–Antero Resources		$	228,993				58,056				—				287,049
Revenue–third-party			—				414				—				414
Amortization of customer relationships			(9,272	)			(8,396	)			—				(17,668	)
Total revenues			219,721				50,074				—				269,795
Operating expenses:
Direct operating			26,190				30,219				—				56,409
General and administrative (excluding equity-based compensation)			6,875				1,128				1,617				9,620
Equity-based compensation			9,487				1,862				250				11,599
Facility idling			—				412				—				412
Depreciation			23,608				13,968				—				37,576
Accretion of asset retirement obligations			—				47				—				47
Loss on asset sale			—				1,379				—				1,379
Total operating expenses			66,160				49,015				1,867				117,042
Operating income			153,561				1,059				(1,867	)			152,753
Other income (expense):
Interest expense, net			—				—				(52,186	)			(52,186	)
Equity in earnings of unconsolidated affiliates			27,597				—				—				27,597
Loss on early extinguishment of debt			—				—				(13,691	)			(13,691	)
Total other income (expense)			27,597				—				(65,877	)			(38,280	)
Income before income taxes			181,158				1,059				(67,744	)			114,473
Income tax expense			—				—				(28,436	)			(28,436	)
Net income and comprehensive income		$	181,158				1,059				(96,180	)			86,037

 

 

 

 

ANTERO MIDSTREAM CORPORATION

Condensed Consolidated Statements of Cash Flows (Unaudited)

(In thousands)

 

		Six Months Ended June 30,
		2023				2024
Cash flows provided by (used in) operating activities:
Net income		$	173,519				189,963
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			70,429				74,671
Accretion of asset retirement obligations			88				91
Deferred income tax expense			60,765				64,924
Equity-based compensation			14,826				20,926
Equity in earnings of unconsolidated affiliates			(50,428	)			(55,127	)
Distributions from unconsolidated affiliates			63,570				68,930
Amortization of customer relationships			35,336				35,336
Amortization of deferred financing costs			2,957				3,150
Settlement of asset retirement obligations			(695	)			(414	)
Loss on settlement of asset retirement obligations			620				—
Loss on asset sale			5,569				1,379
Loss on early extinguishment of debt			—				13,750
Changes in assets and liabilities:
Accounts receivable–Antero Resources			(5,470	)			(12,641	)
Accounts receivable–third party			481				755
Other current assets			(800	)			452
Accounts payable–Antero Resources			(2,515	)			(353	)
Accounts payable–third party			(889	)			3,387
Accrued liabilities			942				17,188
Net cash provided by operating activities			368,305				426,367
Cash flows provided by (used in) investing activities:
Additions to gathering systems, facilities and other			(59,156	)			(62,330	)
Additions to water handling systems			(25,583	)			(16,142	)
Investments in unconsolidated affiliates			(262	)			—
Acquisition of gathering systems and facilities			(266	)			(70,634	)
Cash received in asset sales			1,071				685
Change in other assets			(15	)			(1	)
Net cash used in investing activities			(84,211	)			(148,422	)
Cash flows provided by (used in) financing activities:
Dividends to common stockholders			(218,971	)			(220,736	)
Dividends to preferred stockholders			(275	)			(275	)
Issuance of Senior Notes			—				600,000
Redemption of Senior Notes			—				(560,862	)
Payments of deferred financing costs			—				(7,274	)
Borrowings on Credit Facility			502,100				1,006,400
Repayments on Credit Facility			(558,600	)			(1,080,800	)
Employee tax withholding for settlement of equity-based compensation awards			(8,348	)			(14,464	)
Net cash used in financing activities			(284,094	)			(278,011	)
Net decrease in cash and cash equivalents			—				(66	)
Cash and cash equivalents, beginning of period			—				66
Cash and cash equivalents, end of period		$	—				—
Supplemental disclosure of cash flow information:
Cash paid during the period for interest		$	107,607				88,672
Increase (decrease) in accrued capital expenditures and accounts payable for property and equipment		$	(2,814	)			2,576

 

 

 

Cover	Jul. 31, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Jul. 31, 2024
Entity File Number	001-38075
Entity Registrant Name	ANTERO MIDSTREAM CORPORATION
Entity Central Index Key	0001623925
Entity Tax Identification Number	61-1748605
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	1615 Wynkoop Street
Entity Address, City or Town	Denver
Entity Address, State or Province	CO
Entity Address, Postal Zip Code	80202
City Area Code	303
Local Phone Number	357-7310
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.01 Per Share
Trading Symbol	AM
Security Exchange Name	NYSE
Entity Emerging Growth Company	false

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