Crestwood Announces Quarterly Distribution, Provides Market Update and Schedules First Quarter 2020 Earnings Release Date
Crestwood Equity Partners LP (NYSE: CEQP) (“Crestwood” or “CEQP”) announced today that the board of directors of its general partner has declared the partnership’s quarterly cash distribution of $0.625 per limited partner unit ($2.50 annually) for the quarter ended March 31, 2020. In addition, Crestwood announced a quarterly cash distribution of $0.2111 per Class A preferred equity unit ($0.8444 annually). Both common and preferred distributions will be made on May 15, 2020, to unitholders of record as of May 8, 2020.
“Based on our current financial position and expected first quarter financial and operating results, Crestwood’s board of directors has elected to maintain the common and preferred distributions at their current levels for the quarter ended March 31, 2020. We are closely monitoring the unprecedented market conditions created by the COVID-19 pandemic and the corresponding volatility for global crude oil demand and commodity prices. Crestwood has been responding to these extraordinary market events by aggressively canceling or delaying capital projects, significantly reducing operating and administrative costs, optimizing storage assets and working with customers to maintain volumes across our diversified asset portfolio. We are also closely collaborating with our customers, considering near-term market prices and access, to update Crestwood’s financial and operating guidance for the balance of 2020 as the financial policies we laid out earlier this year are no longer relevant or appropriate on an intermediate-term basis given the current environment. These revised forecasts, and the current dislocations we are seeing across our capital structure, will form the basis for our comprehensive strategy focused on preserving liquidity and balance sheet flexibility through this industry-wide downturn. As a part of this strategy, we are evaluating multiple avenues to further enhance and preserve optionality with respect to the company’s financial position, including our common and preferred unit distribution policies,” commented Robert G. Phillips, Chairman, President and Chief Executive Officer.
Mr. Phillips continued, “Due to actions we have taken in the past several years, including building substantial distribution coverage and a strong balance sheet with no debt maturities until 2023, Crestwood is positioned to manage the partnership through this current down-cycle. Additionally, in response to the unprecedented industry conditions over the past few weeks, we have reduced Crestwood’s capital expenditures in 2020 by over $40 million and O&M and G&A expenses by approximately $40 million on an annual run-rate basis. These cost reductions are intended to partially offset the near-term impact of record low crude oil prices and limited market access for our customers in the current market environment. Over the long term, we continue to believe that our diversified portfolio of midstream infrastructure assets and services will position Crestwood to regain the value our stakeholders have lost due to the current pandemic crisis.”
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