Southcross Energy Partners, L.P. Reports Third Quarter 2016 Results

DALLAS, Texas, Nov. 08, 2016 (GLOBE NEWSWIRE) -- Southcross Energy Partners, L.P. (NYSE:SXE) ("Southcross" or the "Partnership") today announced third quarter 2016 financial and operating results. 

Southcross' net loss was $32.6 million for the quarter ended September 30, 2016, compared to $9.7 million for the same period in the prior year and $7.4 million for the quarter ended June 30, 2016.  Net loss for the third quarter was higher than the prior quarter loss due primarily to higher depreciation and amortization expense and lower gain on sale of assets. 

Adjusted EBITDA (as defined below) was $14.8 million for the quarter ended September 30, 2016, compared to $23.6 million for the same period in the prior year and $15.6 million for the quarter ended June 30, 2016. Adjusted EBITDA for the third quarter was below the prior quarter due to lower processed gas volumes, partially offset by lower expenses. 

Processed gas volumes during the quarter averaged 299 MMcf/d, a decrease of 32% compared to 441 MMcf/d for the same period in the prior year and a decrease of 6% compared to 319 MMcf/d for the quarter ended June 30, 2016. The sequential quarter volumetric decline primarily represents a producer that reduced volumes below the minimum volume commitment level.  Any deficiency payments associated with this volumetric shortfall will be determined at the end of the year.     

Southcross implemented several key initiatives during the quarter that are expected to reduce operating expenses and lower future capital expenditure requirements.  These initiatives include the planned shut-down and sale of two of its older and less efficient processing facilities and the reconfiguration of assets at the Lone Star processing facility to reduce electricity costs.  In 2017, Southcross expects to realize $2 million in annual cost savings and $6 million in reduced annual capital expenditure requirements.  Southcross also expects to receive $12 million in proceeds in 2017 related to these activities, which includes insurance recoveries and the sale of emissions credits. These represent the initial steps of a comprehensive cost savings program that has been approved by Southcross' Board of Directors and will be realized throughout 2017.

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