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SEC Filings
10-Q
BLACK STONE MINERALS, L.P. filed this Form 10-Q on 11/07/2017
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expenditures. Net working interest capital expenditures consist of all capital expenditures related to working interest wells less the recoupment of working interest expenditures under our farmout agreement.
Adjusted EBITDA, distributable cash flow, and distributable cash flow after net working interest capital expenditures should not be considered an alternative to, or more meaningful than, net income (loss), income (loss) from operations, cash flows from operating activities, or any other measure of financial performance presented in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) as measures of our financial performance.
Adjusted EBITDA, distributable cash flow, and distributable cash flow after net working interest capital expenditures have important limitations as analytical tools because they exclude some but not all items that affect net income (loss), the most directly comparable U.S. GAAP financial measure. Our computation of Adjusted EBITDA, distributable cash flow, and distributable cash flow after net working interest capital expenditures may differ from computations of similarly titled measures of other companies.
The following table presents a reconciliation of Adjusted EBITDA, distributable cash flow and distributable cash flow after net working interest capital expenditures to net income (loss), the most directly comparable U.S. GAAP financial measure, for the periods indicated:
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2017
 
2016
 
2017
 
2016

 
(Unaudited)
(In thousands)
Net income (loss)
 
$
22,034

 
$
37,535

 
$
137,793

 
$
27,474

Adjustments to reconcile to Adjusted EBITDA:
 
 

 
 

 
 

 
 

Depreciation, depletion and amortization
 
29,204

 
28,731

 
84,483

 
79,654

Interest expense
 
4,172

 
2,282

 
11,660

 
4,773

Impairment of oil and natural gas properties
 

 

 

 
6,775

Accretion of asset retirement obligations
 
260

 
206

 
760

 
680

Equity-based compensation1
 
7,675

 
7,981

 
18,614

 
33,120

Unrealized (gain) loss on commodity derivative instruments
 
14,320


(2,511
)

(23,048
)

51,515

Adjusted EBITDA
 
77,665

 
74,224

 
230,262

 
203,991

Adjustments to reconcile to distributable cash flow:
 
 

 
 

 
 

 
 

Change in deferred revenue
 
(701
)
 
(396
)
 
(1,670
)
 
(175
)
Cash interest expense
 
(3,946
)
 
(2,083
)
 
(10,999
)
 
(4,179
)
(Gain) loss on sales of assets, net
 

 

 
(931
)
 
(4,772
)
 Estimated replacement capital expenditures2
 
(3,250
)
 
(3,750
)
 
(10,250
)
 
(7,500
)
Cash paid to noncontrolling interests

(24
)

(29
)

(90
)

(83
)
Redeemable preferred unit distributions
 
(666
)

(1,324
)

(2,452
)

(4,439
)
Distributable Cash Flow
 
69,078


66,642


203,870


182,843

Net working interest capital expenditures
 
(1,793
)

(26,329
)

(34,088
)

(63,039
)
Distributable cash flow after net working interest capital expenditures
 
$
67,285


$
40,313


$
169,782


$
119,804

 

1 On April 25, 2016, the Compensation Committee of the Board approved a resolution to change the settlement feature of certain employee long-term incentive
compensation plans from cash to equity. As a result of the modification, $10.1 million of cash-settled liabilities were reclassified to equity-settled liabilities
during the second quarter of 2016.

2On August 3, 2016, the Board of Directors of our general partner (the “Board”) established a replacement capital expenditure estimate of $15.0 million for the period of April 1, 2016 to March 31, 2017. There was no established estimate of replacement capital expenditures prior to this period. On June 8, 2017, the Board established a replacement capital expenditure estimate of $13.0 million for the period of April 1, 2017 to March 31, 2018.




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