Analyst Day. January 18, 2018

Transcription

1 Analyst Day January 18, 2018

2 Forward-Looking Statements 2 This presentation contains forward-looking statements. All statements, other than statements of historical facts, included in this presentation that address activities, events or developments that Antero Midstream Partners LP, and its subsidiaries (collectively, the Partnership ) or Antero Midstream GP LP and its subsidiaries other than the Partnership (collectively, AMGP ) as applicable expect, believe or anticipate will or may occur in the future are forward-looking statements. The words believe, expect, anticipate, plan, intend, estimate, project, foresee, should, would, could, or other similar expressions are intended to identify forward-looking statements. However, the absence of these words does not mean that the statements are not forward-looking. Without limiting the generality of the foregoing, forward-looking statements contained in this presentation specifically include expectations of plans, strategies, objectives, and anticipated financial and operating results of AMGP, the Partnership and Antero Resources Corporation ( Antero Resources ). These statements are based on certain assumptions made by the AMGP, the Partnership and Antero Resources based on management s experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of AMGP or the Partnership, as applicable, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include the factors discussed or referenced under the heading Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2016 and in the Partnership s subsequent filings with the SEC, as well as the factors discussed under Risk Factors in AMGP s final prospectus dated May 3, 2017 and filed with the SEC on May 5, AMGP and the Partnership caution you that these forward-looking statements are subject to risks and uncertainties that may cause these statements to be inaccurate, and readers are cautioned not to place undue reliance on such statements. These risks include, but are not limited to, Antero Resources expected future growth, Antero Resources ability to meet its drilling and development plan, commodity price volatility, inflation, environmental risks, drilling and completion and other operating risks, regulatory changes, the uncertainty inherent in projecting future rates of production, cash flow and access to capital, the timing of development expenditures, and the other risks discussed or referenced under the heading Item 1A. Risk Factors in the Partnership s Annual Report on Form 10-K for the year ended December 31, 2016 and in the Partnership s subsequent filings with the SEC. The Partnership s ability to make future distributions is substantially dependent upon the development and drilling plan of Antero Resources, which itself is substantially dependent upon the review and approval by the board of directors of Antero Resources of its capital budget on an annual basis. In connection with the review and approval of the annual capital budget by the board of directors of Antero Resources, the board of directors will take into consideration many factors, including expected commodity prices and the existing contractual obligations and capital resources and liquidity of Antero Resources at the time. In addition, AMGP s ability to make future distributions is substantially dependent on the Partnership s business, financial conditions and the ability to make distributions. Any forward-looking statement speaks only as of the date on which such statement is made, and neither AMGP or the Partnership undertakes any obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law. Antero Midstream Partners LP is denoted as AM, Antero Midstream GP LP is denoted as AMGP and Antero Resources Corporation is denoted as AR in the presentation, which are their respective New York Stock Exchange ticker symbols.

3 Agenda 3 Why Are We Here Today? PAUL RADY AND GLEN WARREN CO-FOUNDERS 5-year Outlook: Unmatched Yield Growth MICHAEL KENNEDY CFO of ANTERO MIDSTREAM

4 Simplified Organizational Structure An $18B Family Valuation Sponsors (1) Public Sponsors (1) Public 27% 73% 68% 32% NYSE: AR Enterprise Value: $9.7B Corp Ratings: Ba2 / BB / BBB- 53% 100% Incentive Distribution Rights (IDRs) NYSE: AMGP Enterprise Value: $3.9B No Ratings Public 47% NYSE: AM Enterprise Value: $7.0B Corp Ratings: Ba2 / BB / BBB- Note: Enterprise value as of 1/12/18. (1) Affiliates represents Warburg Pincus, Yorktown & senior management. 4

5 Why Are We Here Today? AMGP is at An Inflection Point 5 AR s visible and de-risked development plan AM s organic growth strategy results in peer-leading LP distribution growth AMGP is still in it s early stage IDR growth phase 100% Pure Play IDR Vehicle Debt-free unlevered balance sheet General Partner with unmatched yield growth

6 The Antero Family AMGP Distributions LP Distributions Per Unit and IDR Split Levels MQD 115% 125% 150% 4Q17 AM Annualized Distribution Rate 2017 AM Adjusted EBITDA: $530 MM $1.32 LP DPU (1) $0.68 $0.78 $0.85 $ % to IDRs 100% LP 25% to IDRs 85% LP 15% 75% LP 25% $1.46 Aggregate Cash Distributions: 74% to LPs 26% to IDRs 50% to IDRs 50% LP 50% IDRs LOW PRESSURE GATHERING COMPRESSION HIGH PRESSURE GATHERING LP Distributions 50/50 JV PROCESSING PROCESSING & FRACTIONATION JOINT VENTURE IDRs 2017 AR Standalone Adj. EBITDAX: $1.3 Bn 53 Tcfe 3P Reserves 4.7 Bcf/d FT Position Standalone Leverage: 2.6x (1) AMGP Shareholders 1. Based on actuals through 3Q17 and midpoint of 4Q17 guidance. Leverage as of 9/30/17. 3P reserves as of 6/30/2017 and include 15.4 Tcfe Proved, 29.1 Tcfe Probable and 1.9 Tcfe Possible. 6

7 AMGP Introduces 2020 & 2021 s As a result of AM targeting 20% distribution growth in 2021 and 2022, AMGP is targeting distribution growth of 29% and 27% in 2021 and 2022 AMGP Long-Term Distribution s (Midpoint) $2.50 $ % AMGP Distributions Per Share 64% 53% Year-over-Year Distribution Growth $1.73 $ % 60% 50% $1.50 $ % $1.00 $ % 27% 30% $0.50 $ % 10% $ Guidance % Note: Represents midpoint of target range growth based on full year 2017 distribution of $0.205/share. 7

8 AMGP Directly Benefits from Tax Reform AMGP increased its distribution targets by 20% across the board as a result of the reduction in federal corporate tax rates to 21% effective Jan 1 st, 2018 AMGP Long-Term Distribution s $2.50 $2.00 Previous s 5-Year Total Distributions/Unit Previous s: $6.69 New s - 21% Corporate Tax Rate: $5.65 Increase: +$1.04 New 21% Corporate Tax Rate $1.73 $1.88 $2.20 $1.50 $1.34 $1.48 $1.11 $1.00 $0.73 $0.88 $0.50 $0.45 $0.54 $ Guidance Note: Distributions per share represent midpoint of target range. 8

9 9 Attractive Valuation Proposition Visible distribution growth provides attractive long-term yield and valuation proposition AMGP Long-Term Distribution s and Implied Yield $2.50 Distribution Per Share AMGP Forward Yield 10.5% 12.0% $ % $ % $ % $ % $1.00 $ % 2.5% $ % $0.88 $ % 4.0% 2.0% $0.00 $0.30 4Q17 Annualized 2018 Guidance % Based on AMGP Share price of $21.04 as of 1/12/18. Note: distributions per share represent midpoint of target range.

10 Yield AMGP Yield vs. Distribution Growth Attractive value proposition of yield and distribution growth AMGP Yield vs. 3-Year DPU CAGR (G&P Peers) 12.0% Denotes investment grade MLP or sponsor 10.0% SMLP ENLK BPL CEQP R-squared: % DPM ENBL TEP WES ETE 6.0% WPZ 4.0% 2.0% CNNX HESM MPLX TEGP WGP RMP ENLC EQM SHLX DM NBLX AM EQGP AMGP Implied: Price: $29.87 Yield: 0.8% AMGP Current: Price: $21.04 Yield: 1.1% AMGP AMGP Implied 0.0% 0% 10% 20% 30% 40% 50% 60% 70% 80% Compound Annual Distribution Growth Based on FactSet consensus estimates as of 1/12/