2016 Q4 Form 10-K Financial Statement

#000138365017000011 Filed on February 24, 2017

View on sec.gov

Income Statement

Concept 2016 Q4 2016 Q3 2016 Q2
Revenue $551.0M $331.0M $151.0M
YoY Change 719.06% 390.1% 123.08%
Cost Of Revenue $262.2M $159.0M $49.00M
YoY Change 1086.43% -600.41% 53746.15%
Gross Profit $288.4M $172.0M $102.0M
YoY Change 539.47% 73.19% 50.89%
Gross Profit Margin 52.34% 51.96% 67.55%
Selling, General & Admin $25.50M $27.40M $25.00M
YoY Change -43.83% -6.8% -33.51%
% of Gross Profit 8.84% 15.93% 24.51%
Research & Development $0.00 $0.00 $0.00
YoY Change -100.0% -100.0% -100.0%
% of Gross Profit 0.0% 0.0% 0.0%
Depreciation & Amortization $63.60M $44.00M $29.00M
YoY Change 251.38% 163.68% 81.35%
% of Gross Profit 22.05% 25.58% 28.43%
Operating Expenses $89.00M $283.0M $138.0M
YoY Change 39.28% 795.12% 91.65%
Operating Profit $199.0M $48.00M $13.00M
YoY Change -1161.96% 33.63% -401.07%
Interest Expense -$96.30M $114.0M $72.00M
YoY Change 157.49% 130.96% 43.58%
% of Operating Profit -48.39% 237.5% 553.85%
Other Income/Expense, Net $500.0K -$130.0M -$113.0M
YoY Change 400.0% 116.48% 102.78%
Pretax Income $85.30M -$81.50M -$100.1M
YoY Change -252.32% 238.17% 66.83%
Income Tax
% Of Pretax Income
Net Earnings $86.00M -$82.00M -$100.0M
YoY Change -253.46% 239.8% 66.55%
Net Earnings / Revenue 15.61% -24.77% -66.23%
Basic Earnings Per Share $0.07 -$0.27 -$0.21
Diluted Earnings Per Share $0.07 -$0.27 -$0.21
COMMON SHARES
Basic Shares Outstanding
Diluted Shares Outstanding

Balance Sheet

Concept 2016 Q4 2016 Q3 2016 Q2
SHORT-TERM ASSETS
Cash & Short-Term Investments $0.00 $12.00M $12.00M
YoY Change -100.0% -92.94% -93.85%
Cash & Equivalents $0.00 $12.47M $12.26M
Short-Term Investments
Other Short-Term Assets $29.00M $16.18M $21.73M
YoY Change 104.48% -96.03% -94.43%
Inventory $97.00M $60.52M $48.33M
Prepaid Expenses
Receivables $225.0M $138.0M $109.0M
Other Receivables $2.000M $13.00M $4.000M
Total Short-Term Assets $958.0M $808.4M $646.0M
YoY Change 94.13% 25.76% 3.46%
LONG-TERM ASSETS
Property, Plant & Equipment $14.16B $13.79B $13.22B
YoY Change 18.66% 22.03% 25.79%
Goodwill
YoY Change
Intangibles
YoY Change
Long-Term Investments $0.00
YoY Change
Other Assets $222.0M $216.9M $217.9M
YoY Change -4.32% 13.59% 48.0%
Total Long-Term Assets $14.58B $14.13B $13.61B
YoY Change 18.19% 18.73% 16.51%
TOTAL ASSETS
Total Short-Term Assets $958.0M $808.4M $646.0M
Total Long-Term Assets $14.58B $14.13B $13.61B
Total Assets $15.54B $14.94B $14.26B
YoY Change 21.11% 19.09% 15.85%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $27.00M $20.33M $35.58M
YoY Change 64.56% 186.54% 238.0%
Accrued Expenses $418.0M $387.3M $336.3M
YoY Change 86.36% 9.9% 7.69%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $224.0M $1.763B $1.662B
YoY Change -86.61%
Total Short-Term Liabilities $856.0M $2.312B $2.165B
YoY Change -58.51% 441.0% 430.22%
LONG-TERM LIABILITIES
Long-Term Debt $14.21B $12.20B $11.54B
YoY Change 41.83% 8.46% 5.01%
Other Long-Term Liabilities $0.00 $167.0K $170.0K
YoY Change -100.0% -85.81% -90.73%
Total Long-Term Liabilities $14.21B $12.20B $11.54B
YoY Change 41.83% 8.45% 4.99%
TOTAL LIABILITIES
Total Short-Term Liabilities $856.0M $2.312B $2.165B
Total Long-Term Liabilities $14.21B $12.20B $11.54B
Total Liabilities $15.07B $14.51B $13.71B
YoY Change 24.69% 24.29% 20.22%
SHAREHOLDERS EQUITY
Retained Earnings
YoY Change
Common Stock
YoY Change
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $443.0M $382.0M $488.0M
YoY Change
Total Liabilities & Shareholders Equity $15.54B $14.94B $14.26B
YoY Change 21.11% 19.09% 15.85%

Cashflow Statement

Concept 2016 Q4 2016 Q3 2016 Q2
OPERATING ACTIVITIES
Net Income $86.00M -$82.00M -$100.0M
YoY Change -253.46% 239.8% 66.55%
Depreciation, Depletion And Amortization $63.60M $44.00M $29.00M
YoY Change 251.38% 163.68% 81.35%
Cash From Operating Activities $41.80M $56.00M -$92.00M
YoY Change 533.33% -1700.0% -267.27%
INVESTING ACTIVITIES
Capital Expenditures -$431.1M -$660.0M -$509.0M
YoY Change -44.81% -6.17% -42.52%
Acquisitions
YoY Change
Other Investing Activities $700.0K $0.00 -$5.000M
YoY Change -99.91% -100.0% -100.57%
Cash From Investing Activities -$430.4M -$660.0M -$514.0M
YoY Change 7194.92% -17468.42% 7458.82%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities 398.2M 723.0M 656.0M
YoY Change -1692.8% -3015.32% -2755.87%
NET CHANGE
Cash From Operating Activities 41.80M 56.00M -92.00M
Cash From Investing Activities -430.4M -660.0M -514.0M
Cash From Financing Activities 398.2M 723.0M 656.0M
Net Change In Cash 9.600M 119.0M 50.00M
YoY Change -139.51% -585.71% 112.77%
FREE CASH FLOW
Cash From Operating Activities $41.80M $56.00M -$92.00M
Capital Expenditures -$431.1M -$660.0M -$509.0M
Free Cash Flow $472.9M $716.0M $417.0M
YoY Change -39.96% 2.3% -55.66%

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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Concentration of Credit Risk</font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">&#160;</font></div><div style="line-height:120%;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Financial instruments that potentially subject us to a concentration of credit risk consist principally of cash and cash equivalents and restricted cash. We maintain cash balances at financial institutions, which may at times be in excess of federally insured levels. We have not incurred losses related to these balances to date.</font></div><div style="line-height:120%;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The use of derivative instruments exposes us to counterparty credit risk, or the risk that a counterparty will be unable to meet its commitments. Our interest rate derivative instruments are placed with investment grade financial institutions whom we believe are acceptable credit risks. Our commodity derivative transactions are executed through over-the-counter contracts which are subject to nominal credit risk as these transactions are settled on a daily margin basis with investment grade financial institutions. Collateral deposited for such contracts is recorded as other current asset. We monitor counterparty creditworthiness on an ongoing basis; however, we cannot predict sudden changes in counterparties&#8217; creditworthiness. In addition, even if such changes are not sudden, we may be limited in our ability to mitigate an increase in counterparty credit risk. Should one of these counterparties not perform, we may not realize the benefit of some of our derivative instruments.</font></div><div style="line-height:120%;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">SPL has entered into </font><font style="font-family:inherit;font-size:10pt;">six</font><font style="font-family:inherit;font-size:10pt;"> fixed price </font><font style="font-family:inherit;font-size:10pt;">20</font><font style="font-family:inherit;font-size:10pt;">-year SPAs with </font><font style="font-family:inherit;font-size:10pt;">six</font><font style="font-family:inherit;font-size:10pt;"> unaffiliated third parties. SPL is dependent on the respective counterparties&#8217; creditworthiness and their willingness to perform under their respective SPAs. During the </font><font style="font-family:inherit;font-size:10pt;">year ended December 31, 2016</font><font style="font-family:inherit;font-size:10pt;">, we received </font><font style="font-family:inherit;font-size:10pt;">77%</font><font style="font-family:inherit;font-size:10pt;"> of our net LNG revenues from </font><font style="font-family:inherit;font-size:10pt;">one</font><font style="font-family:inherit;font-size:10pt;"> SPA customer.</font></div><div style="line-height:120%;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">SPLNG has entered into </font><font style="font-family:inherit;font-size:10pt;">two</font><font style="font-family:inherit;font-size:10pt;"> long-term TUAs with unaffiliated third parties for regasification capacity at the Sabine Pass LNG terminal, which accounts for substantially all of our regasification revenues. SPLNG is dependent on the respective counterparties&#8217; creditworthiness and their willingness to perform under their respective TUAs. SPLNG has mitigated this credit risk by securing TUAs for a significant portion of its regasification capacity with creditworthy third-party customers with a minimum Standard&#160;&amp; Poor&#8217;s rating of AA. </font></div></div>
CY2016 us-gaap Nature Of Operations
NatureOfOperations
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">ORGANIZATION AND NATURE OF OPERATIONS</font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are a publicly traded Delaware limited partnership (NYSE MKT: CQP) formed by Cheniere. </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">T</font><font style="font-family:inherit;font-size:10pt;">hrough our wholly owned subsidiary, SPL, we are developing, constructing and operating </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">natural gas liquefaction facilities </font><font style="font-family:inherit;font-size:10pt;">(the &#8220;Liquefaction Project&#8221;)</font><font style="font-family:inherit;font-size:10pt;color:#231f20;"> at the Sabine Pass LNG terminal</font><font style="font-family:inherit;font-size:10pt;"> </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">located </font><font style="font-family:inherit;font-size:10pt;">in Cameron Parish, Louisiana, </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">on </font><font style="font-family:inherit;font-size:10pt;">the Sabine-Neches Waterway</font><font style="font-family:inherit;font-size:10pt;color:#231f20;"> less than four miles from the Gulf Coast. </font><font style="font-family:inherit;font-size:10pt;">We plan to construct up to </font><font style="font-family:inherit;font-size:10pt;">six</font><font style="font-family:inherit;font-size:10pt;"> Trains, which are in various stages of development, construction and operations. Trains 1 and 2 have commenced operating activities, Train 3 is undergoing commissioning and has produced LNG, Trains 4 and 5 are under construction and Train 6 is fully permitted. Each Train is expected to have a nominal production capacity, which is prior to adjusting for planned maintenance, production reliability and potential overdesign, of approximately </font><font style="font-family:inherit;font-size:10pt;">4.5</font><font style="font-family:inherit;font-size:10pt;"> mtpa of LNG. Through our wholly owned subsidiary, SPLNG, we own and operate regasification facilities at</font><font style="font-family:inherit;font-size:10pt;color:#231f20;"> the Sabine Pass LNG terminal, which includes existing infrastructure of </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">five</font><font style="font-family:inherit;font-size:10pt;color:#231f20;"> LNG storage tanks with capacity of </font><font style="font-family:inherit;font-size:10pt;">approximately </font><font style="font-family:inherit;font-size:10pt;">16.9</font><font style="font-family:inherit;font-size:10pt;color:#231f20;"> Bcfe, </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">two</font><font style="font-family:inherit;font-size:10pt;color:#231f20;"> marine berths that can accommodate </font><font style="font-family:inherit;font-size:10pt;">vessels with nominal capacity of</font><font style="font-family:inherit;font-size:10pt;color:#231f20;"> up to </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">266,000</font><font style="font-family:inherit;font-size:10pt;color:#231f20;"> cubic meters and vaporizers with regasification capacity of approximately </font><font style="font-family:inherit;font-size:10pt;color:#231f20;">4.0</font><font style="font-family:inherit;font-size:10pt;color:#231f20;"> Bcf/d. </font><font style="font-family:inherit;font-size:10pt;">We also own a </font><font style="font-family:inherit;font-size:10pt;">94</font><font style="font-family:inherit;font-size:10pt;">-mile pipeline that interconnects the Sabine Pass LNG terminal with a number of large interstate pipelines </font><font style="font-family:inherit;font-size:10pt;">(the &#8220;Creole Trail Pipeline&#8221;)</font><font style="font-family:inherit;font-size:10pt;"> through our wholly owned subsidiary, CTPL. </font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As of December 31, </font><font style="font-family:inherit;font-size:10pt;">2016</font><font style="font-family:inherit;font-size:10pt;">, Cheniere owned </font><font style="font-family:inherit;font-size:10pt;">100%</font><font style="font-family:inherit;font-size:10pt;"> of our general partner interest and </font><font style="font-family:inherit;font-size:10pt;">82.6%</font><font style="font-family:inherit;font-size:10pt;"> of Cheniere Holdings, which owned </font><font style="font-family:inherit;font-size:10pt;">12.0 million</font><font style="font-family:inherit;font-size:10pt;"> of our common units, </font><font style="font-family:inherit;font-size:10pt;">45.3 million</font><font style="font-family:inherit;font-size:10pt;"> of our Class B units and </font><font style="font-family:inherit;font-size:10pt;">135.4 million</font><font style="font-family:inherit;font-size:10pt;"> of our subordinated units.</font></div></div>
CY2016 us-gaap Use Of Estimates
UseOfEstimates
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Use of Estimates</font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div><div style="line-height:120%;text-align:justify;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The preparation of Consolidated Financial Statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and the accompanying notes. Management evaluates its estimates and related assumptions regularly, including those related to the value of property, plant and equipment, collectability of accounts receivable, derivative instruments, asset retirement obligations </font><font style="font-family:inherit;font-size:10pt;">(&#8220;AROs&#8221;)</font><font style="font-family:inherit;font-size:10pt;"> and fair value measurements. Changes in facts and circumstances or additional information may result in revised estimates, and actual results may differ from these estimates.</font></div></div>

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