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EQT Midstream Partners, LP (NYSE: EQM), an EQT Corporation company, today announced fourth quarter 2012 financial and operating results. Net income for the quarter totaled $20.2 million and adjusted EBITDA was $22.8 million. Distributable cash flow was $14.8 million for the quarter. Adjusted operating income when compared to the same quarter last year was higher by about $2.3 million, or 14%, excluding a $2.5 million non-cash favorable adjustment to fourth quarter selling, general and administrative expense related to the reduction of a reserve on the collectability of long-term regulatory assets. The non-GAAP financial measures are reconciled in the Non-GAAP Disclosures section of this press release.
EQT Midstream Partners, LP (Partnership) closed its initial public offering (IPO) on July 2, 2012. Results for periods prior to the IPO are attributable to its predecessor, Equitrans, LP (Equitrans).
The Partnership has a capital lease with EQT Corporation (EQT) for the lease of the Sunrise Pipeline (Sunrise), and operates the pipeline as part of its transmission and storage system. Revenues and expenses associated with Sunrise are included in the Partnership’s financial statements; however, the monthly lease payment to EQT Corporation offsets the impact on the Partnership’s distributable cash flow; therefore, fourth quarter 2012 results are discussed on an adjusted basis, excluding Sunrise.
Adjusted operating revenues increased $4.2 million or 14% compared to operating revenues for the same quarter last year. The increase was due to an increase in contracted transmission capacity, including the Blacksville Compressor project which was completed in September 2012, and increased system throughput related to growth in Marcellus Shale development. Adjusted operating expenses increased $1.9 million versus the fourth quarter of 2011, after excluding a non-cash $2.5 million favorable regulatory reserve reduction. The increase in adjusted operating expenses is consistent with the transmission system growth and public company costs incurred in 2012 as a result of the IPO.