Subsidiary Guarantors | 6 Months Ended |
Jun. 30, 2014 |
SUBSIDIARY GUARANTORS [Abstract] | ' |
Subsidiary Guarantors | ' |
SUBSIDIARY GUARANTORS |
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The Partnership has issued registered debt securities guaranteed by its subsidiaries. As of June 30, 2014, all guarantors were wholly-owned or available to be pledged and such guarantees were joint and several and full and unconditional. Although the guarantees of the Partnership's subsidiary guarantors are considered full and unconditional, the guarantees are subject to certain customary release provisions. Such guarantees may be released in the following customary circumstances: |
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• | in connection with any sale or other disposition of all or substantially all of the properties or assets of that guarantor (including by way of merger or consolidation) to a person that is not (either before or after giving effect to such transaction) an issuer or a restricted subsidiary of the Partnership; | | | | | | | | | | | | | | | | | | | | | | |
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• | in connection with any sale or other disposition of capital stock of that guarantor to a person that is not (either before or after giving effect to such transaction) an issuer or a restricted subsidiary of us, such that, the guarantor ceases to be a restricted subsidiary of us as a result of the sale or other disposition; | | | | | | | | | | | | | | | | | | | | | | |
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• | if the Partnership designates any restricted subsidiary that is a guarantor to be an unrestricted subsidiary in accordance with the applicable provisions of the indenture; | | | | | | | | | | | | | | | | | | | | | | |
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• | upon legal defeasance or satisfaction and discharge of the indenture; | | | | | | | | | | | | | | | | | | | | | | |
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• | upon the liquidation or dissolution of such guarantor provided no default or event of default has occurred that is continuing; | | | | | | | | | | | | | | | | | | | | | | |
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• | at such time as such guarantor ceases to guarantee any other indebtedness of either of the issuers or any guarantor; or | | | | | | | | | | | | | | | | | | | | | | |
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• | upon such guarantor consolidating with, merging into or transferring all of its properties or assets to us or another guarantor, and as a result of, or in connection with, such transaction such guarantor dissolving or otherwise ceasing to exist. | | | | | | | | | | | | | | | | | | | | | | |
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In accordance with Rule 3-10 of SEC Regulation S-X, the Partnership has prepared Unaudited Condensed Consolidating Financial Statements as supplemental information. The following unaudited condensed consolidating balance sheets at June 30, 2014 and December 31, 2013, and unaudited condensed consolidating statements of operations for the three and six months ended June 30, 2014 and 2013, and unaudited condensed consolidating statements of cash flows for the six months ended June 30, 2014 and 2013, present financial information for Eagle Rock Energy as the parent on a stand-alone basis (carrying any investments in subsidiaries under the equity method), financial information for the co-issuer and the subsidiary guarantors, which are all 100% owned by the parent, on a stand-alone basis, and the consolidation and elimination entries necessary to arrive at the information for the Partnership on a consolidated basis. The subsidiary guarantors are not restricted from making distributions to the Partnership. Pursuant to the Contribution of the Midstream Business, all of the Partnership's Midstream Subsidiaries were contributed to Regency on July 1, 2014 and released from their guarantees under the indenture and Credit Agreement. |
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Unaudited Condensed Consolidating Balance Sheet |
June 30, 2014 |
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| | | | | | | | | | | | | | | | | | | | | | | |
| Parent Issuer | | Co-Issuer | | Subsidiary Guarantors | | Non-Guarantor Investments | | Consolidating | | Total |
Entries |
| ($ in thousands) |
ASSETS: | | | | | | | | | | | |
Accounts receivable – related parties | $ | 676,812 | | | $ | — | | | $ | — | | | $ | — | | | $ | (676,812 | ) | | $ | — | |
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Assets held for sale | 9,401 | | | — | | | 1,201,829 | | | — | | | — | | | $ | 1,211,230 | |
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Other current assets | 6,055 | | | 1 | | | 42,804 | | | — | | | — | | | 48,860 | |
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Total property, plant and equipment, net | 1,966 | | | — | | | 857,929 | | | — | | | — | | | 859,895 | |
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Investment in subsidiaries | 1,161,226 | | | — | | | — | | | 884 | | | (1,162,110 | ) | | — | |
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Total other long-term assets | 1,423 | | | — | | | 9,357 | | | — | | | — | | | 10,780 | |
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Total assets | $ | 1,856,883 | | | $ | 1 | | | $ | 2,111,919 | | | $ | 884 | | | $ | (1,838,922 | ) | | $ | 2,130,765 | |
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LIABILITIES AND EQUITY: | | | | | | | | | | | |
Accounts payable – related parties | $ | — | | | $ | — | | | $ | 676,812 | | | $ | — | | | $ | (676,812 | ) | | $ | — | |
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Current portion of long-term debt | 439,000 | | | — | | | — | | | — | | | — | | | 439,000 | |
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Liabilities held for sale | 509,767 | | | — | | | 116,965 | | | — | | | — | | | 626,732 | |
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Other current liabilities | 23,828 | | | — | | | 74,174 | | | — | | | — | | | 98,002 | |
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Other long-term liabilities | 10,574 | | | — | | | 82,743 | | | — | | | — | | | 93,317 | |
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Long-term debt | 380,712 | | | — | | | — | | | — | | | — | | | 380,712 | |
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Equity | 493,002 | | | 1 | | | 1,161,225 | | | 884 | | | (1,162,110 | ) | | 493,002 | |
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Total liabilities and equity | $ | 1,856,883 | | | $ | 1 | | | $ | 2,111,919 | | | $ | 884 | | | $ | (1,838,922 | ) | | $ | 2,130,765 | |
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Unaudited Condensed Consolidating Balance Sheet |
December 31, 2013 |
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| | | | | | | | | | | | | | | | | | | | | | | |
| Parent Issuer | | Co-Issuer | | Subsidiary | | Non-Guarantor Investments | | Consolidating Entries | | Total |
Guarantors |
| ($ in thousands) |
ASSETS: | | | | | | | | | | | |
Accounts receivable – related parties | $ | 691,588 | | | $ | — | | | $ | — | | | $ | — | | | $ | (691,588 | ) | | $ | — | |
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Assets held for sale | 7,333 | | | — | | | 1,252,049 | | | — | | | — | | | 1,259,382 | |
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Other current assets | 6,927 | | | 1 | | | 22,080 | | | — | | | — | | | 29,008 | |
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Total property, plant and equipment, net | 2,318 | | | — | | | 822,133 | | | — | | | — | | | 824,451 | |
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Investment in subsidiaries | 1,133,217 | | | — | | | — | | | 908 | | | (1,134,125 | ) | | — | |
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Total other long-term assets | 11,441 | | | — | | | 3,268 | | | — | | | — | | | 14,709 | |
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Total assets | $ | 1,852,824 | | | $ | 1 | | | $ | 2,099,530 | | | $ | 908 | | | $ | (1,825,713 | ) | | $ | 2,127,550 | |
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LIABILITIES AND EQUITY: | | | | | | | | | | | |
Accounts payable – related parties | $ | — | | | $ | — | | | $ | 691,588 | | | $ | — | | | $ | (691,588 | ) | | $ | — | |
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Current portion of long-term debt | — | | | — | | | — | | | — | | | — | | | — | |
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Liabilities held for sale | 500,110 | | | — | | | 137,628 | | | — | | | — | | | 637,738 | |
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Other current liabilities | 15,688 | | | — | | | 66,141 | | | — | | | — | | | 81,829 | |
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Other long-term liabilities | 5,667 | | | — | | | 70,957 | | | — | | | — | | | 76,624 | |
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Long-term debt | 757,480 | | | — | | | — | | | — | | | — | | | 757,480 | |
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Equity | 573,879 | | | 1 | | | 1,133,216 | | | 908 | | | (1,134,125 | ) | | 573,879 | |
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Total liabilities and equity | $ | 1,852,824 | | | $ | 1 | | | $ | 2,099,530 | | | $ | 908 | | | $ | (1,825,713 | ) | | $ | 2,127,550 | |
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Unaudited Condensed Consolidating Statement of Operations |
For the Three Months Ended June 30, 2014 |
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| Parent Issuer | | Co-Issuer | | Subsidiary Guarantors | | Non-Guarantor Investments | | Consolidating | | Total |
Entries |
| ($ in thousands) |
Total revenues | $ | (18,081 | ) | | $ | — | | | $ | 52,125 | | | $ | — | | | $ | — | | | $ | 34,044 | |
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Operations and maintenance | 3 | | | — | | | 10,904 | | | — | | | — | | | 10,907 | |
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Taxes other than income | — | | | — | | | 3,596 | | | — | | | — | | | 3,596 | |
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General and administrative | 2,064 | | | — | | | 9,941 | | | — | | | — | | | 12,005 | |
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Depreciation, depletion and amortization | 295 | | | — | | | 20,004 | | | — | | | — | | | 20,299 | |
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Loss from operations | (20,443 | ) | | — | | | 7,680 | | | — | | | — | | | (12,763 | ) |
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Interest expense, net | (4,946 | ) | | — | | | (2 | ) | | — | | | — | | | (4,948 | ) |
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Other non-operating income | 2,163 | | | — | | | 2,291 | | | — | | | (4,454 | ) | | — | |
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Other non-operating expense | (1,987 | ) | | — | | | (3,036 | ) | | — | | | 4,454 | | | (569 | ) |
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Income (loss) before income taxes | (25,213 | ) | | — | | | 6,933 | | | — | | | — | | | (18,280 | ) |
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Income tax benefit | 82 | | | — | | | (967 | ) | | — | | | — | | | (885 | ) |
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Equity in earnings of subsidiaries | 9,377 | | | — | | | — | | | — | | | (9,377 | ) | | — | |
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Income (loss) from continuing operations | (15,918 | ) | | — | | | 7,900 | | | — | | | (9,377 | ) | | (17,395 | ) |
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Discontinued operations, net of tax | (27,123 | ) | | — | | | 1,479 | | | (2 | ) | | — | | | (25,646 | ) |
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Net income (loss) | $ | (43,041 | ) | | $ | — | | | $ | 9,379 | | | $ | (2 | ) | | $ | (9,377 | ) | | $ | (43,041 | ) |
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Unaudited Condensed Consolidating Statement of Operations |
For the Three Months Ended June 30, 2013 |
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| Parent Issuer | | Co-Issuer | | Subsidiary Guarantors | | Non-Guarantor Investments | | Consolidating Entries | | Total |
| ($ in thousands) |
Total revenues | $ | 17,338 | | | $ | — | | | $ | 49,328 | | | $ | — | | | $ | — | | | $ | 66,666 | |
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Operations and maintenance | — | | | — | | | 9,579 | | | — | | | — | | | 9,579 | |
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Taxes other than income | — | | | — | | | 3,583 | | | — | | | — | | | 3,583 | |
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General and administrative | 3,031 | | | — | | | 10,310 | | | — | | | — | | | 13,341 | |
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Depreciation, depletion and amortization | 299 | | | — | | | 21,761 | | | — | | | — | | | 22,060 | |
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Impairment | — | | | — | | | 1,839 | | | — | | | — | | | 1,839 | |
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Income from operations | 14,008 | | | — | | | 2,256 | | | — | | | — | | | 16,264 | |
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Interest expense, net | (4,446 | ) | | — | | | (53 | ) | | — | | | — | | | (4,499 | ) |
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Other non-operating income | 2,238 | | | — | | | 2,325 | | | — | | | (4,563 | ) | | — | |
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Other non-operating expense | (1,602 | ) | | — | | | (3,139 | ) | | — | | | 4,563 | | | (178 | ) |
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Income (loss) before income taxes | 10,198 | | | — | | | 1,389 | | | — | | | — | | | 11,587 | |
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Income tax provision (benefit) | (98 | ) | | — | | | (446 | ) | | — | | | — | | | (544 | ) |
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Equity in earnings of subsidiaries | 9,962 | | | — | | | — | | | — | | | (9,962 | ) | | — | |
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Income (loss) from continuing operations | 20,258 | | | — | | | 1,835 | | | — | | | (9,962 | ) | | 12,131 | |
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Discontinued operations, net of tax | (4,226 | ) | | — | | | 8,128 | | | (1 | ) | | — | | | 3,901 | |
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Net income (loss) | $ | 16,032 | | | $ | — | | | $ | 9,963 | | | $ | (1 | ) | | $ | (9,962 | ) | | $ | 16,032 | |
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Unaudited Condensed Consolidating Statement of Operations |
For the Six Months Ended June 30, 2014 |
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| | | | | | | | | | | | | | | | | | | | | | | |
| Parent Issuer | | Co-Issuer | | Subsidiary Guarantors | | Non-Guarantor Investments | | Consolidating | | Total |
Entries |
| ($ in thousands) |
Total revenues | $ | (28,114 | ) | | $ | — | | | $ | 107,361 | | | $ | — | | | $ | — | | | $ | 79,247 | |
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Operations and maintenance | 3 | | | — | | | 22,402 | | | — | | | — | | | 22,405 | |
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Taxes other than income | — | | | — | | | 7,387 | | | — | | | — | | | 7,387 | |
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General and administrative | 4,961 | | | — | | | 20,334 | | | — | | | — | | | 25,295 | |
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Depreciation, depletion and amortization | 348 | | | — | | | 40,357 | | | — | | | — | | | 40,705 | |
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(Loss) income from operations | (33,426 | ) | | — | | | 16,881 | | | — | | | — | | | (16,545 | ) |
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Interest expense, net | (9,700 | ) | | — | | | (2 | ) | | — | | | — | | | (9,702 | ) |
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Other non-operating income | 4,384 | | | — | | | 4,592 | | | — | | | (8,976 | ) | | — | |
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Other non-operating expense | (3,703 | ) | | — | | | (6,131 | ) | | — | | | 8,976 | | | (858 | ) |
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(Loss) income before income taxes | (42,445 | ) | | — | | | 15,340 | | | — | | | — | | | (27,105 | ) |
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Income tax benefit | (185 | ) | | — | | | (1,565 | ) | | — | | | — | | | (1,750 | ) |
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Equity in earnings of subsidiaries | 28,011 | | | — | | | — | | | — | | | (28,011 | ) | | — | |
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Income (loss) from continuing operations | (14,249 | ) | | — | | | 16,905 | | | — | | | (28,011 | ) | | (25,355 | ) |
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Discontinued operations, net of tax | (47,355 | ) | | — | | | 11,115 | | | (9 | ) | | — | | | (36,249 | ) |
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Net (loss) income | $ | (61,604 | ) | | $ | — | | | $ | 28,020 | | | $ | (9 | ) | | $ | (28,011 | ) | | $ | (61,604 | ) |
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Unaudited Condensed Consolidating Statement of Operations |
For the Six Months Ended June 30, 2013 |
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| | | | | | | | | | | | | | | | | | | | | | | |
| Parent Issuer | | Co-Issuer | | Subsidiary Guarantors | | Non-Guarantor Investments | | Consolidating Entries | | Total |
| ($ in thousands) |
Total revenues | $ | 10,502 | | | $ | — | | | $ | 96,630 | | | $ | — | | | $ | — | | | $ | 107,132 | |
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Operations and maintenance | — | | | — | | | 21,279 | | | — | | | — | | | 21,279 | |
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Taxes other than income | — | | | — | | | 5,999 | | | — | | | — | | | 5,999 | |
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General and administrative | 6,679 | | | — | | | 19,972 | | | — | | | — | | | 26,651 | |
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Depreciation, depletion and amortization | 346 | | | — | | | 43,010 | | | — | | | — | | | 43,356 | |
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Impairment | — | | | — | | | 1,839 | | | — | | | — | | | 1,839 | |
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Income from operations | 3,477 | | | — | | | 4,531 | | | — | | | — | | | 8,008 | |
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Interest expense, net | (8,731 | ) | | — | | | (833 | ) | | — | | | — | | | (9,564 | ) |
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Other non-operating income | 4,519 | | | — | | | 4,659 | | | — | | | (9,178 | ) | | — | |
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Other non-operating expense | (3,218 | ) | | — | | | (6,302 | ) | | — | | | 9,178 | | | (342 | ) |
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Loss before income taxes | (3,953 | ) | | — | | | 2,055 | | | — | | | — | | | (1,898 | ) |
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Income tax benefit | (673 | ) | | — | | | (1,432 | ) | | — | | | — | | | (2,105 | ) |
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Equity in earnings of subsidiaries | (907 | ) | | — | | | — | | | — | | | 907 | | | — | |
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Income (loss) from continuing operations | (4,187 | ) | | — | | | 3,487 | | | — | | | 907 | | | 207 | |
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Discontinued operations, net of tax | (13,295 | ) | | — | | | (4,388 | ) | | (6 | ) | | — | | | (17,689 | ) |
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Net loss | $ | (17,482 | ) | | $ | — | | | $ | (901 | ) | | $ | (6 | ) | | $ | 907 | | | $ | (17,482 | ) |
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Unaudited Condensed Consolidating Statement of Cash Flows |
For the Six Months Ended June 30, 2014 |
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| | | | | | | | | | | | | | | | | | | | | | | |
| Parent Issuer | | Co-Issuer | | Subsidiary Guarantors | | Non-Guarantor Investments | | Consolidating Entries | | Total |
| ($ in thousands) |
Net cash flows provided by operating activities | $ | 2,594 | | | $ | — | | | $ | 23,080 | | | $ | — | | | $ | — | | | $ | 25,674 | |
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CASH FLOWS FROM INVESTING ACTIVITIES: | | | | | | | | | | | |
Additions to property, plant and equipment | 4 | | | — | | | (63,793 | ) | | — | | | — | | | (63,789 | ) |
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Net cash flows used in investing activities | 4 | | | — | | | (63,793 | ) | | — | | | — | | | (63,789 | ) |
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CASH FLOWS FROM FINANCING ACTIVITIES: | | | | | | | | | | | |
Proceeds from long-term debt | 315,150 | | | — | | | — | | | — | | | — | | | 315,150 | |
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Repayment of long-term debt | (252,950 | ) | | — | | | — | | | — | | | — | | | (252,950 | ) |
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Payment of debt issuance cost | (410 | ) | | — | | | — | | | — | | | — | | | (410 | ) |
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Proceeds from derivative contracts | (3,425 | ) | | — | | | — | | | — | | | — | | | (3,425 | ) |
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Repurchase of common units | (1,084 | ) | | — | | | — | | | — | | | — | | | (1,084 | ) |
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Distributions to members and affiliates | (23,801 | ) | | — | | | — | | | — | | | — | | | (23,801 | ) |
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Net cash flows used in financing activities | 33,480 | | | — | | | — | | | — | | | — | | | 33,480 | |
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Net cash flows used in discontinued operations | (34,973 | ) | | — | | | 40,251 | | | 22 | | | — | | | 5,300 | |
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Net increase (decrease) in cash and cash equivalents | 1,105 | | | — | | | (462 | ) | | 22 | | | — | | | 665 | |
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Cash and cash equivalents at beginning of period | 1,237 | | | 1 | | | (1,389 | ) | | 227 | | | — | | | 76 | |
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Cash and cash equivalents at end of period | $ | 2,342 | | | $ | 1 | | | $ | (1,851 | ) | | $ | 249 | | | $ | — | | | $ | 741 | |
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Unaudited Condensed Consolidating Statement of Cash Flows |
For the Six Months Ended June 30, 2013 |
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| | | | | | | | | | | | | | | | | | | | | | | |
| Parent Issuer | | Co-Issuer | | Subsidiary Guarantors | | Non-Guarantor Investments | | Consolidating Entries | | Total |
| ($ in thousands) |
Net cash flows (used in) provided by operating activities | $ | (31,423 | ) | | $ | — | | | $ | 88,507 | | | $ | — | | | $ | — | | | $ | 57,084 | |
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CASH FLOWS FROM INVESTING ACTIVITIES: | | | | | | | | | | | |
Additions to property, plant and equipment | (855 | ) | | — | | | (82,540 | ) | | — | | | — | | | (83,395 | ) |
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Net cash flows used in investing activities | (855 | ) | | — | | | (82,540 | ) | | — | | | — | | | (83,395 | ) |
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CASH FLOWS FROM FINANCING ACTIVITIES: | | | | | | | | | | | |
Proceeds from long-term debt | 316,700 | | | — | | | — | | | — | | | — | | | 316,700 | |
|
Repayment of long-term debt | (312,200 | ) | | — | | | — | | | — | | | — | | | (312,200 | ) |
|
Proceeds from derivative contracts | 877 | | | — | | | — | | | — | | | — | | | 877 | |
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Common unit issued in equity offerings | 102,388 | | | — | | | — | | | — | | | — | | | 102,388 | |
|
Issuance costs for equity offerings | (4,181 | ) | | — | | | — | | | — | | | — | | | (4,181 | ) |
|
Repurchase of common units | (1,000 | ) | | — | | | — | | | — | | | — | | | (1,000 | ) |
|
Distributions to members and affiliates | (67,117 | ) | | — | | | — | | | — | | | — | | | (67,117 | ) |
|
Net cash flows provided by financing activities | 35,467 | | | — | | | — | | | — | | | — | | | 35,467 | |
|
Net cash flows used in discontinued operations | (3,660 | ) | | — | | | (5,447 | ) | | 21 | | | — | | | (9,086 | ) |
|
Net (decrease) increase in cash and cash equivalents | (471 | ) | | — | | | 520 | | | 21 | | | — | | | 70 | |
|
Cash and cash equivalents at beginning of period | 1,670 | | | 1 | | | (1,832 | ) | | 186 | | | — | | | 25 | |
|
Cash and cash equivalents at end of period | $ | 1,199 | | | $ | 1 | | | $ | (1,312 | ) | | $ | 207 | | | $ | — | | | $ | 95 | |
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