Western Midstream Partners, LP (NYSE: WES) reported Q1 EPS of ($0.57), $1.08 worse than the analyst estimate of $0.51. Revenue for the quarter came in at $774.31 million versus the consensus estimate of $710.42 million.

"WES's first-quarter results attest to the high-quality of our asset portfolio," said Chief Executive Officer, Michael Ure. "COVID-19 and the resulting precipitous decline in commodity prices have created significant near-to-medium-term uncertainty, but we remain steadfast in our belief that our high-quality assets and the contracts underpinning the financial stability of our portfolio position WES to manage through this unprecedented cycle. Our first-quarter results demonstrate the strength of our assets in a normalized environment, and our employees' ability to operate efficiently as a dedicated midstream workforce capable of producing improved results."

REVISED 2020 GUIDANCE

Our revised guidance is based on information obtained through direct discussions with a large majority of our customers. We will continue monitoring producer activity levels and may adjust our 2020 guidance and future distribution levels based on additional curtailments and other changes to producer-planned activities that may be communicated to us throughout the balance of 2020. Notwithstanding and based on known changes to producer activity, our updated guidance is as follows:

• Adjusted EBITDA between $1.725 billion and $1.825 billion, which includes previously announced cost reductions of approximately $75 million attributable to estimated operating and maintenance and general and administrative expense cost savings
• Total capital expenditures between $450 million and $550 million, representing a 45-percent reduction to prior guidance, including costs associated with approximately 15,000 horsepower of compression, over 65 miles of gathering, the completion of the second Latham train during first-quarter 2020, and the addition of two 30 MBbls/d oil-stabilization trains and approximately 120 MBbls/d of saltwater disposal capacity in the Delaware Basin by year-end 2020
• 50-percent distribution decrease from fourth-quarter 2019 per-unit distribution of $0.622

"Our revised 2020 guidance demonstrates our continued focus on exercising capital discipline to create long-term value for stakeholders by generating positive free cash flow after distributions, while continuing to deliver exceptional customer service in a safe and responsible manner," said Chief Financial Officer, Mike Pearl. "Our timely and highly successful bond offering earlier this year coupled with our recent 50-percent distribution reduction results in no near-term need to access the capital markets. Although our largely undrawn $2.0 billion revolver provides us ample liquidity to manage through the current economic downturn, we expect that our full-year 2020 operational and financial performance and distribution reduction will result in the generation of meaningful 2020 Free cash flow after distributions. Our ability to generate near-term Free cash flow after distributions allows us to strengthen our balance sheet through leverage reduction so that we are positioned to be financially flexible and opportunistic as current market conditions abate."

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