e8vk
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)
August 15, 2007 (August 14, 2007)
TARGA RESOURCES PARTNERS LP
(Exact name of registrant as specified in its charter)
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Delaware
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001-33303
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65-1295427 |
(State or other jurisdiction
of incorporation or organization)
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(Commission
File Number)
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(IRS Employer
Identification No.) |
1000 Louisiana, Suite 4300
Houston, TX 77002
(Address of principal executive office)
(713) 584-1000
(Registrants telephone number, including area code)
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:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c)) |
TABLE OF CONTENTS
2.02. Results of Operations and Financial Condition.
On August 14, 2007, Targa Resources Partners LP (the Partnership) issued a press release
regarding its financial results for the three and six months ended June 30, 2007 and held a webcast
conference call discussing those results. A copy of the earnings press release is filed as Exhibit
99.1 to this report, which is hereby incorporated by reference into this Item 2.02. A replay of
the webcast will be available through the Investors section of the Partnerships web site
(http://www.targaresources.com) until August 21.
The press release and accompanying schedules and/or the conference call discussions include
the non-generally accepted accounting principles, or non-GAAP, financial measures of distributable
cash flow and EBITDA. The press release provides reconciliations of these non-GAAP financial
measures to their most directly comparable financial measure calculated and presented in accordance
with generally accepted accounting principles in the United States of America (GAAP). Our
non-GAAP financial measures should not be considered as alternatives to GAAP measures such as net
income, operating income, net cash flows provided by operating activities or any other GAAP measure
of liquidity or financial performance.
Item 9.01 Financial Statements and Exhibits.
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Exhibit |
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Description |
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Exhibit 99.1
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Targa Resources Partners LP Press Release dated August 14, 2007. |
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 thereunto duly authorized.
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TARGA RESOURCES PARTNERS LP |
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By:
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Targa Resources GP LLC |
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its general partner |
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Dated: August 15, 2007
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By:
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/s/ Jeffrey J. McParland |
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Jeffrey J. McParland
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Executive Vice President and Chief Financial Officer |
EXHIBIT INDEX
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Exhibit |
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Number |
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Description |
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Exhibit 99.1
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Targa Resources Partners LP Press Release dated August 14, 2007. |
exv99w1
Exhibit 99.1
TARGA RESOURCES PARTNERS LP REPORTS
SECOND QUARTER 2007 EARNINGS
HOUSTONAugust 14, 2007Targa Resources Partners LP (Targa Resources Partners or the
Partnership) (NASDAQ: NGLS) today announced its financial results for the three and six months
ended June 30, 2007. For the second quarter of 2007, the Partnership reported (i) net income of
$4.0 million, or 13¢ per unit on a fully diluted basis, (ii) income from operations of $9.5 million
and (iii) earnings before interest, taxes, depreciation and amortization (EBITDA) of $23.8
million. EBITDA is a non-generally accepted accounting principle (or non-GAAP) financial measure
that is defined and reconciled later in this press release to its most directly comparable GAAP
financial measure net income (loss).
For the first six months of 2007, the Partnership reported (i) a net loss of $0.7 million (ii)
income from operations of $17.7 million and (iii) EBITDA of $46.2 million. Results for the six
month period include the results of the Partnerships predecessor (the Predecessor) from January
1, 2007 through February 13, 2007 (the Pre-IPO Period) and the results of operations since the
completion of its initial public offering (IPO) from February 14, 2007 to June 30, 2007 (the
Post-IPO Period). Unless stated otherwise, the year to date results discussed in this release
are for the full six month period, including both the Pre-IPO and the Post-IPO periods. Results
for 2006 are for the Predecessor.
On July 23, 2007, the board of Targa Resources Partners general partner declared a cash
distribution of $0.3375 per common unit, or $1.35 per unit on an annualized basis, for the second
quarter. Distributable cash flow for the second quarter of 2007 was $16.2 million, which
corresponds to a 1.53 times distribution coverage. Distributable cash flow is a non-GAAP financial
measure that is defined and reconciled later in this press release to its most directly comparable
GAAP financial measure, net income (loss).
Review of Quarterly Results
Revenues were $106.4 million for the three-month period ended June 30, 2007, 15% higher than
revenues of $92.7 million for the three months ended June 30, 2006. Income from operations for the
second quarter of 2007 increased by 40% to $9.5 million from $6.8 million in 2006. The primary
drivers for these improvements were increases in average realized natural gas, NGL and condensate
prices (including the impact of hedges) of 28%, 3% and 6%, respectively.
Net income for the second quarter was $4.0 million versus a loss of $13.0 million for the same
period last year. The net loss in 2006 is primarily due to interest expense related to debt that
was allocated to the Predecessor by Targa Resources, Inc. (Targa), its parent company, totaling
$18.3 million for the three months ended June 30, 2006. In connection with the IPO, the
Partnership repaid a portion of this indebtedness and the balance was retired and treated as a
capital contribution to the Partnership.
For the quarter ended June 30, 2007, gathering throughput (the volume of natural gas gathered and
passed through natural gas gathering pipelines), was essentially flat at 166.4 MMcf/d compared to
166.8 MMcf/d for the same period in 2006. For the same periods, plant natural gas inlet (the
volume of natural gas passing through the meter located at the inlet of a processing plant) was
also approximately flat at 160.4 MMcf/d compared to 160.3 MMcf/d. Gathering throughput and plant
inlet volumes for the second quarter were adversely impacted by abnormal amounts of rain which
slowed producer drilling operations and well connects in the Partnerships areas of operations.
Gross NGL production of 18.4 MBbl/d for the three months ended June 30, 2007 compares to NGL
production of 18.5 MBbl/d for the three months ended June 30, 2006. Natural gas sales volumes of
73.8 BBtu/d in the quarter ended June 30, 2007 were lower than the 74.8 BBtu/d sold in the
comparable 2006 period. Conversely, condensate sales of 1.9 MBbl/d for the second quarter of 2007
were higher than the 1.6 MBbl/d sold in the same 2006 period.
Review of First Six Months Results
For the six months ended June 30, 2007 revenues were $200.0 million, 6% higher than revenues of
$188.9 million for the six months ended June 30, 2006. Income from operations for the first half
of 2007 increased by 27%, to $17.7 million from $13.9 million in 2006. The primary driver for these
improvements was increases in realized natural gas and NGL prices, including the impacts of our
hedging program.
Net loss for the six months ended June 30, 2007 was $0.7 million versus a loss of $23.2 million for
the same period last year. The 2007 total includes affiliate interest expense of $9.8 million
during the Pre-IPO Period. The 2006 net loss is primarily due to interest expense related to debt
that was allocated to the Predecessor by Targa, its parent company, totaling $35.7 million for the
six months ended June 30, 2006. In connection with the IPO, the Partnership repaid a portion of
this indebtedness and the balance was retired and treated as a capital contribution to the
Partnership.
For the six months ended June 30, 2007, gathering throughput was 166.3 MMcf/d and plant natural gas
inlet was 160.0 MMcf/d,
relatively unchanged from levels in the same 2006 period. In addition to the impacts of
unseasonable amounts of rain in the second quarter mentioned above, throughput and inlet volumes
during the first quarter of 2007 were adversely impacted by freezing weather during the winter
months which reduced wellhead volumes and impeded new well connections.
Gross NGL production of 17.3 MBbl/d for the first half of 2007 was 7% lower than the comparable
2006 production of 18.7 MBbl/d, while natural gas sales of 75.9 Bbtu/d for the six months ended
June 30, 2007 were up from the 74.4 Bbtu/d of natural gas sales during the six months ended June
30, 2006 . The decline in gross NGL production and related increase in natural gas sales were due
to operational issues with a liquids treater during the first quarter of 2007 which limited our
liquids recovery. The operational issues with the treater were resolved during March of 2007.
Finally, condensate sales for the six months ended June 30, 2007 of 1.9 MBbl/d were higher than the
1.6 MBbl/d sold during the first six months of 2006.
Contract Mix, Hedges and Realized Prices
Approximately 97% of the Partnerships gathered volumes are processed under percent-of-proceeds
contracts with the balance covered by keep-whole and fee-for-service contracts. Under
percent-of-proceeds contracts, we receive a portion of the natural gas and/or NGLs as payment for
our services. As a result, we are exposed to price risk on the portion of commodities that we
receive as payment, which we refer to as our equity volumes. To mitigate the impact of commodity
price fluctuations on our business, we enter into hedging contracts.
During the three and six months ended June 30, 2007, revenues were increased by net hedge
settlements of $1.0 million and $5.0 million, respectively. For the three months ended June 30,
2007 our average realized prices, including the impact of hedges, for natural gas, NGL and
condensate were $7.03 per MMBtu, 92¢ per gallon and $56.68 per barrel, respectively, compared to
$5.51 per MMBtu, 89¢ per gallon and $53.57 per barrel, respectively, in the second quarter of 2006.
Capitalization
In conjunction with the Partnerships IPO, we entered into a five-year, $500 million senior
secured revolving credit facility, the full amount of which is available for the issuance of
letters of credit. Total funded debt at June 30, 2007 was approximately $294.5 million,
approximately 28% of total book capitalization.
Development Activities
Since the Partnerships IPO, the partnership has added more than 20,000 acres of new
dedications and approved over $12 million in growth projects. Organic projects in progress
include:
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$5.7 million for the installation of a pipeline system and the acquisition of a
producer owned pipeline system in Wise and Montague counties. The project includes over
4,400 acres of dedications with estimated initial production of 3.1 MMBtu/d; |
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$3.9 million for the installation of a pipeline and compression system in Wise
county which includes a 20,000 acreage dedication in Wise and Southern Montague
counties; and |
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the installation of 4.3 MMcf/d of compression and 10 MMcf/d of dehydration in
Jack and Palo Pinto counties and the addition of 2.3 MMcf/d of volumes to the system. |
In addition, we are evaluating over $170 million of potential organic growth projects including the
expansion of a CO2 amine treater, the addition of compression and system expansion
projects in Jack, Wise, Palo Pinto and Montague counties.
Conference Call
Targa Resources Partners will host a conference call for investors and analysts at 10 a.m. ET (9
a.m. CT) on August 14, 2007 to discuss second quarter earnings. The conference call can be
accessed via Webcast through the Investors section of the Partnerships web site at
http://www.targaresources.com or by dialing 800-257-7063. The pass code is 11094287#.
Please call in 5 to 10 minutes prior to the scheduled start time. A replay of the Webcast will be
available through the Investors section of the Partnerships web site approximately 2 hours
following completion of the Webcast and will remain available until August 21.
About Targa Resources Partners
Targa Resources Partners was recently formed by Targa Resources, Inc. (Targa) to engage in the
business of gathering, compressing, treating, processing and selling natural gas and fractionating
and selling natural gas liquids and natural gas liquids products. The Partnership operates in the
Fort Worth Basin in north Texas. A subsidiary of Targa is the general partner of the Partnership.
Targa Resources Partners owns an extensive network of integrated gathering pipelines, two natural
gas processing plants and a fractionator. Targa Resources Partners principal executive offices
are located at 1000 Louisiana, Suite 4300, Houston, Texas 77002 and its telephone number is
713-584-1000.
Use of Non-GAAP Financial Measures
This press release and accompanying schedules include non-GAAP financial measures of distributable
cash flow and EBITDA. The press release provides reconciliations of these non-GAAP financial
measures to their most directly comparable financial measure calculated and presented in accordance
with generally accepted accounting principles in the United States of America (GAAP). Our
non-GAAP financial measures should not be considered as alternatives to GAAP measures such as net
income, operating income, net cash flows provided by operating activities or any other GAAP measure
of liquidity or financial performance.
EBITDA We define EBITDA as net income or loss before interest, income taxes, depreciation and
amortization. EBITDA is used as a supplemental financial measure by us and by external users of our
financial statements, such as investors, commercial banks and others, to assess: (i) the financial
performance of our assets without regard to financing methods, capital structures or historical
cost basis; (ii) our operating performance and return on capital as compared to other companies in
the midstream energy sector, without regard to financing or capital structure and (iii) the
viability of acquisitions and capital expenditure projects and the overall rates of return on
alternative investment opportunities. The economic substance behind our use of EBITDA is to measure
the ability of our assets to generate cash sufficient to pay interest costs, support our
indebtedness, and make distributions to our investors.
The GAAP measure most directly comparable to EBITDA is net income (loss). Our non-GAAP financial
measure of EBITDA should not be considered as an alternative to GAAP net income (loss). EBITDA is
not a presentation made in accordance with GAAP and has important limitations as an analytical
tool. You should not consider EBITDA in isolation or as a substitute for analysis of our results
as reported under GAAP. Because EBITDA excludes some, but not all, items that affect net income
and is defined differently by different companies in our industry, our definition of EBITDA may not
be comparable to similarly titled measures of other companies.
We compensate for the limitations of EBITDA as an analytical tool by reviewing the comparable GAAP
measure, understanding the differences between the measures and incorporating these learnings into
our decision making processes.
The following table presents a reconciliation of EBITDA to net income (loss) for the periods shown:
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Three Months Ended |
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Three Months Ended |
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Six Months Ended |
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Six Months Ended |
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June 30, 2007 |
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June 30, 2006 |
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June 30, 2007 |
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June 30, 2006 |
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(in millions) |
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Reconciliation of Non-GAAP Measures |
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(unaudited) |
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Reconciliation of net income to EBITDA : |
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Net loss |
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$ |
4.0 |
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$ |
(13.0 |
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$ |
(0.7 |
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$ |
(23.2 |
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Add: |
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Interest expense, net |
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5.2 |
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18.3 |
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17.7 |
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35.7 |
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Deferred income tax expense |
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0.3 |
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1.5 |
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0.7 |
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1.5 |
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Depreciation and amortization expense |
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14.3 |
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13.7 |
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28.5 |
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27.4 |
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EBITDA |
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$ |
23.8 |
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$ |
20.5 |
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$ |
46.2 |
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$ |
41.4 |
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Distributable Cash Flow Distributable cash flow is a significant performance metric used by
us and by external users of our financial statements, such as investors, commercial banks, research
analysts and others to compare basic cash flows generated by us (prior to the establishment of any
retained cash reserves by our general partner) to the cash distributions we expect to pay our
unitholders. Using this metric, management can quickly compute the coverage ratio of estimated
cash flows to planned cash distributions. Distributable cash flow is also an important non-GAAP
financial measure for our unitholders because it serves as an indicator of our success in providing
a cash return on investment. Specifically, this financial measure indicates to investors whether
or not we are
generating cash flow at a level that can sustain or support an increase in our
quarterly distribution rates. Distributable cash flow is also
a quantitative standard used throughout the investment community with respect to publicly-traded
partnerships and limited liability companies because the value of a unit of such an entity is
generally determined by the units yield (which in turn is based on the amount of cash
distributions the entity pays to a unitholder). The economic substance behind our use of
distributable cash flow is to measure the ability of our assets to generate cash flows sufficient
to make distributions to our investors.
The GAAP measure most directly comparable to distributable cash flow is net income (loss). Our
non-GAAP measure of distributable cash flow should not be considered as an alternative to GAAP net
income (loss). Distributable cash flow is not a presentation made in accordance with GAAP and has
important limitations as an analytical tool. You should not consider distributable cash flow in
isolation or as a substitute for analysis of our results as reported under GAAP. Because
distributable cash flow excludes some but not all, items that affect net income (loss) and is
defined differently by different companies in our industry, our definition of distributable cash
flow may not be compatible to similarly titled measures of other companies, thereby diminishing its
utility.
We compensate for the limitations of distributable cash flow as an analytical tool by reviewing the
comparable GAAP measures, understanding the differences between the measures and incorporating
these learnings into our decision-making processes.
The following table presents a reconciliation of distributable cash flow to net income (loss) for
the periods shown:
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Three Months Ended |
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Three Months Ended |
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Six Months Ended |
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Six Months Ended |
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June 30, 2007 |
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June 30, 2006 |
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June 30, 2007 |
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June 30, 2006 |
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(in millions) |
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(unaudited) |
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Reconciliation of Distributable cash flow to net income (loss): |
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Net income (loss) |
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$ |
4.0 |
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$ |
(13.0 |
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$ |
(0.7 |
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$ |
(23.2 |
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Depreciation and amortization expense |
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14.3 |
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13.7 |
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28.5 |
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27.4 |
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Deferred income tax expense |
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0.3 |
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1.5 |
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0.7 |
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1.5 |
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Amortization of debt issue costs |
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0.2 |
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1.3 |
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0.3 |
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2.6 |
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Maintenance capital expenditures |
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(2.6 |
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(2.8 |
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(5.3 |
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(6.3 |
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Distributable cash flow |
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$ |
16.2 |
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$ |
0.7 |
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$ |
23.5 |
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$ |
2.0 |
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Forward-Looking Statements
Certain statements in this release are 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 in this
release that address activities, events or developments that the Partnership expects, believes or
anticipates will or may occur in the future are forward-looking statements. These forward-looking
statements rely on a number of assumptions concerning future events and are subject to a number of
uncertainties, factors and risks, many of which are outside Targa Resources Partners control,
which could cause results to differ materially from those expected by management of Targa Resources
Partners. Such risks and uncertainties include, but are not limited to, weather, political,
economic and market conditions, including declines in the production of natural gas or in the price
and market demand for natural gas and natural gas liquids, the timing and success of business
development efforts, the credit risk of customers and other uncertainties. These and other
applicable uncertainties, factors and risks are described more fully in the Partnerships Annual
Report on Form 10-K for the year ended December 31, 2006 and other reports filed with the
Securities and Exchange Commission. Targa Resources Partners undertakes no obligation to update or
revise any forward-looking statement, whether as a result of new information, future events or
otherwise.
Investor contact:
Howard Tate
Vice President Finance, Treasurer
713-584-1000
Web site: http://www.targaresources.com
Media contact:
Kenny Juarez
212-371-5999
TARGA RESOURCES PARTNERS LP
CONSOLIDATED STATEMENTS OF OPERATIONS
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Three Months |
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Three Months |
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Six Months |
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Six Months |
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Ended |
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Ended |
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Ended |
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Ended |
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June 30, 2007 |
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June 30, 2006 |
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June 30, 2007 |
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June 30, 2006 |
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(Unaudited) |
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(In thousands, except per unit amounts) |
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Revenues from third parties |
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$ |
4,300 |
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$ |
2,871 |
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$ |
10,384 |
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$ |
4,728 |
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Revenues from affiliates |
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102,103 |
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89,802 |
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189,612 |
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184,196 |
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Total operating revenues |
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106,403 |
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92,673 |
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199,996 |
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188,924 |
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Costs and expenses: |
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Product purchases from third parties |
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74,306 |
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64,657 |
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137,751 |
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132,350 |
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Product purchases from affiliates |
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271 |
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227 |
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514 |
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400 |
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Operating expenses, excluding DD&A |
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6,065 |
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5,599 |
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12,033 |
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11,543 |
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Depreciation and amortization expense |
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14,289 |
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13,719 |
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28,484 |
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27,439 |
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General and administrative expense |
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1,953 |
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1,667 |
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3,531 |
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3,255 |
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96,884 |
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85,869 |
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182,313 |
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174,987 |
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Income from operations |
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9,519 |
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6,804 |
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17,683 |
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13,937 |
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Other expense: |
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Interest expense, net |
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5,154 |
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7,859 |
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Interest expense from affiliates, net |
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9,827 |
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|
|
Interest expense allocated from Parent |
|
|
|
|
|
|
18,302 |
|
|
|
|
|
|
|
35,663 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income taxes |
|
|
4,365 |
|
|
|
(11,498 |
) |
|
|
(3 |
) |
|
|
(21,726 |
) |
Deferred income tax expense |
|
|
327 |
|
|
|
1,454 |
|
|
|
665 |
|
|
|
1,454 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
4,038 |
|
|
$ |
(12,952 |
) |
|
$ |
(668 |
) |
|
$ |
(23,180 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allocation of net income (loss) for the three and six months ended June 30, 2007: |
Net loss attributable to the period from
January 1, 2007 to February 13, 2007 |
|
$ |
|
|
|
|
|
|
|
$ |
(6,861 |
) |
|
|
|
|
Net income attributable to the period from
February 14, 2007 to June 30, 2007 |
|
|
4,038 |
|
|
|
|
|
|
|
6,193 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
4,038 |
|
|
|
|
|
|
$ |
(668 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General partner interest in net income for the period
from February 14, 2007 to June 30, 2007 |
|
$ |
81 |
|
|
|
|
|
|
$ |
124 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common and subordinated unitholders interest
in net income for the period from
February 14, 2007 to June 30, 2007 |
|
$ |
3,957 |
|
|
|
|
|
|
$ |
6,069 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income per common and subordinated unit |
|
$ |
0.13 |
|
|
|
|
|
|
$ |
0.20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income per common and subordinated unit |
|
$ |
0.13 |
|
|
|
|
|
|
$ |
0.20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic average number of common and subordinated
units outstanding |
|
|
30,848 |
|
|
|
|
|
|
|
30,848 |
|
|
|
|
|
Diluted average number of common and subordinated
units outstanding |
|
|
30,855 |
|
|
|
|
|
|
|
30,854 |
|
|
|
|
|
TARGA RESOURCES PARTNERS LP
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
|
June 30, 2007 |
|
|
December 31, 2006 |
|
|
|
(Unaudited) |
|
|
|
|
|
|
(In thousands) |
|
ASSETS
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
9,361 |
|
|
$ |
|
|
Receivables from third parties |
|
|
1,195 |
|
|
|
1,310 |
|
Receivables from affiliated companies |
|
|
50,701 |
|
|
|
|
|
Assets from risk management activities |
|
|
7,616 |
|
|
|
17,250 |
|
Other |
|
|
483 |
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
|
69,356 |
|
|
|
18,560 |
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment, at cost |
|
|
1,139,723 |
|
|
|
1,129,210 |
|
Accumulated depreciation |
|
|
(93,586 |
) |
|
|
(65,102 |
) |
|
|
|
|
|
|
|
Property, plant and equipment, net |
|
|
1,046,137 |
|
|
|
1,064,108 |
|
|
|
|
|
|
|
|
|
|
Long-term assets from risk management activities |
|
|
4,462 |
|
|
|
15,541 |
|
Other long-term assets |
|
|
3,860 |
|
|
|
17,612 |
|
|
|
|
|
|
|
|
Total assets |
|
$ |
1,123,815 |
|
|
$ |
1,115,821 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND PARTNERS CAPITAL
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
4,252 |
|
|
$ |
2,789 |
|
Accrued liabilities |
|
|
33,983 |
|
|
|
28,832 |
|
Current maturities of debt allocated from Parent |
|
|
|
|
|
|
281,083 |
|
Liabilities from risk management activities |
|
|
6,874 |
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
45,109 |
|
|
|
312,704 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt allocated from Parent |
|
|
|
|
|
|
582,877 |
|
Long-term debt |
|
|
294,500 |
|
|
|
|
|
Long-term liabilities from risk management activities |
|
|
11,550 |
|
|
|
96 |
|
Other long-term liabilities |
|
|
1,763 |
|
|
|
1,684 |
|
Deferred income tax liability |
|
|
3,197 |
|
|
|
2,844 |
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies (Note 9) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Partners capital: |
|
|
|
|
|
|
|
|
Common unitholders (19,336,000 units issued and outstanding at June 30, 2007) |
|
|
378,208 |
|
|
|
|
|
Subordinated unitholders (11,528,231 units issued and outstanding at June 30, 2007) |
|
|
376,673 |
|
|
|
|
|
General partner (629,555 units issued and outstanding at June 30, 2007) |
|
|
20,571 |
|
|
|
|
|
Accumulated other comprehensive income (loss) |
|
|
(7,756 |
) |
|
|
30,843 |
|
Net parent investment |
|
|
|
|
|
|
184,773 |
|
|
|
|
|
|
|
|
Total partners capital |
|
|
767,696 |
|
|
|
215,616 |
|
|
|
|
|
|
|
|
Total liabilities and partners capital |
|
$ |
1,123,815 |
|
|
$ |
1,115,821 |
|
|
|
|
|
|
|
|
TARGA RESOURCES PARTNERS LP
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
Six Months |
|
|
Six Months |
|
|
|
Ended |
|
|
Ended |
|
|
|
June 30, 2007 |
|
|
June 30, 2006 |
|
|
|
(Unaudited) |
|
|
|
(In thousands) |
|
Cash flows from operating activities |
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(668 |
) |
|
$ |
(23,180 |
) |
Adjustments to reconcile net loss to net cash
provided by operating activities |
|
|
|
|
|
|
|
|
Depreciation |
|
|
28,484 |
|
|
|
27,439 |
|
Accretion of asset retirement obligations |
|
|
79 |
|
|
|
72 |
|
Amortization of debt issue costs |
|
|
305 |
|
|
|
2,570 |
|
Noncash compensation |
|
|
76 |
|
|
|
|
|
Gain (loss) on sale of assets |
|
|
1 |
|
|
|
(15 |
) |
Deferred income tax expense |
|
|
665 |
|
|
|
1,454 |
|
Risk management activities |
|
|
130 |
|
|
|
|
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(11,730 |
) |
|
|
409 |
|
Inventory |
|
|
|
|
|
|
824 |
|
Other |
|
|
(503 |
) |
|
|
630 |
|
Accounts payable |
|
|
1,463 |
|
|
|
933 |
|
Accrued liabilities |
|
|
5,151 |
|
|
|
(7,754 |
) |
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
|
23,453 |
|
|
|
3,382 |
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
Purchases of property, plant and equipment |
|
|
(10,515 |
) |
|
|
(11,225 |
) |
Other |
|
|
1 |
|
|
|
64 |
|
|
|
|
|
|
|
|
Net cash used in investing activities |
|
|
(10,514 |
) |
|
|
(11,161 |
) |
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
Proceeds from initial public offering |
|
|
380,768 |
|
|
|
|
|
Costs incurred in connection with initial public offering |
|
|
(3,175 |
) |
|
|
|
|
Distributions |
|
|
(5,315 |
) |
|
|
|
|
Proceeds from borrowings under credit facility |
|
|
342,500 |
|
|
|
|
|
Costs incurred in connection with financing arrangements |
|
|
(4,145 |
) |
|
|
|
|
Repayments of loans: |
|
|
|
|
|
|
|
|
Affiliated |
|
|
(665,692 |
) |
|
|
|
|
Credit facility |
|
|
(48,000 |
) |
|
|
|
|
Deemed parent contributions (distributions) |
|
|
(519 |
) |
|
|
7,779 |
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities |
|
|
(3,578 |
) |
|
|
7,779 |
|
|
|
|
|
|
|
|
Cash and cash equivalents, beginning of period |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period |
|
$ |
9,361 |
|
|
$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental cash flow information: |
|
|
|
|
|
|
|
|
Net settlement of allocated indebtedness and debt issue costs |
|
$ |
846,348 |
|
|
$ |
|
|
Net contribution of affiliated indebtedness |
|
|
(665,692 |
) |
|
|
|
|
Net contribution of affiliated receivables |
|
|
38,856 |
|
|
|
|
|
Noncash long-term debt allocation of payments from Parent |
|
|
|
|
|
|
2,466 |
|