CONDENSED CONSOLIDATING FINANCIAL INFORMATION | 18. CONDENSED CONSOLIDATING FINANCIAL INFORMATION The Senior Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by SMLP and the Guarantor Subsidiaries (see Note 10). The following supplemental condensed consolidating financial information reflects SMLP's separate accounts, the combined accounts of the Co-Issuers, the combined accounts of the Guarantor Subsidiaries, the combined accounts of the Non-Guarantor Subsidiaries and the consolidating adjustments for the dates and periods indicated. For purposes of the following consolidating information each of SMLP and the Co-Issuers account for their subsidiary investments, if any, under the equity method of accounting. Condensed Consolidating Balance Sheets. Balance sheets as of March 31, 2018 and December 31, 2017 follow. March 31, 2018 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Assets Cash and cash equivalents $ 213 $ 368 $ 2,331 $ 454 $ — $ 3,366 Accounts receivable 22 — 60,378 8,411 — 68,811 Other current assets 1,194 — 1,955 386 — 3,535 Due from affiliate — — 500,061 37,581 (537,642 ) — Total current assets 1,429 368 564,725 46,832 (537,642 ) 75,712 Property, plant and equipment, net 4,063 — 1,504,830 349,419 — 1,858,312 Intangible assets, net — — 271,504 22,267 — 293,771 Goodwill — — 16,211 — — 16,211 Investment in equity method investees — — — 682,227 — 682,227 Other noncurrent assets 2,768 10,286 99 — — 13,153 Investment in subsidiaries 2,041,996 3,361,858 — — (5,403,854 ) — Total assets $ 2,050,256 $ 3,372,512 $ 2,357,369 $ 1,100,745 $ (5,941,496 ) $ 2,939,386 Liabilities and Partners' Capital Trade accounts payable $ 56 $ — $ 16,822 $ 4,354 $ — $ 21,232 Accrued expenses 940 — 11,607 1,424 — 13,971 Due to affiliate 314,554 223,531 — — (537,642 ) 443 Deferred revenue — — 9,722 437 — 10,159 Ad valorem taxes payable 5 — 3,693 136 — 3,834 Accrued interest — 15,383 — — — 15,383 Accrued environmental remediation — — — 3,068 — 3,068 Other current liabilities 2,314 — 3,338 332 — 5,984 Total current liabilities 317,869 238,914 45,182 9,751 (537,642 ) 74,074 Long-term debt — 1,091,602 — — — 1,091,602 Deferred Purchase Price Obligation 384,617 — — — — 384,617 Noncurrent deferred revenue — — 34,775 1,812 — 36,587 Noncurrent accrued environmental remediation — — — 1,916 — 1,916 Other noncurrent liabilities 3,689 — 2,744 76 — 6,509 Total liabilities 706,175 1,330,516 82,701 13,555 (537,642 ) 1,595,305 Total partners' capital 1,344,081 2,041,996 2,274,668 1,087,190 (5,403,854 ) 1,344,081 Total liabilities and partners' capital $ 2,050,256 $ 3,372,512 $ 2,357,369 $ 1,100,745 $ (5,941,496 ) $ 2,939,386 December 31, 2017 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Assets Cash and cash equivalents $ 126 $ 75 $ 1,138 $ 91 $ — $ 1,430 Accounts receivable 22 — 65,842 6,437 — 72,301 Other current assets 1,188 — 2,697 442 — 4,327 Due from affiliate — — 493,067 22,030 (515,097 ) — Total current assets 1,336 75 562,744 29,000 (515,097 ) 78,058 Property, plant and equipment, net 4,206 — 1,442,333 348,590 — 1,795,129 Intangible assets, net — — 278,958 22,387 — 301,345 Goodwill — — 16,211 — — 16,211 Investment in equity method investees — — — 690,485 — 690,485 Other noncurrent assets 2,547 10,913 105 — — 13,565 Investment in subsidiaries 2,019,700 3,324,464 — — (5,344,164 ) — Total assets $ 2,027,789 $ 3,335,452 $ 2,300,351 $ 1,090,462 $ (5,859,261 ) $ 2,894,793 Liabilities and Partners' Capital Trade accounts payable $ 209 $ — $ 11,283 $ 4,883 $ — $ 16,375 Accrued expenses 928 — 10,592 979 — 12,499 Due to affiliate 263,935 252,250 — — (515,097 ) 1,088 Deferred revenue — — 4,000 — — 4,000 Ad valorem taxes payable — — 7,809 520 — 8,329 Accrued interest — 12,310 — — — 12,310 Accrued environmental remediation — — — 3,130 — 3,130 Other current liabilities 6,395 — 4,385 478 — 11,258 Total current liabilities 271,467 264,560 38,069 9,990 (515,097 ) 68,989 Long-term debt — 1,051,192 — — — 1,051,192 Deferred Purchase Price Obligation 362,959 — — — — 362,959 Noncurrent deferred revenue — — 12,707 — — 12,707 Noncurrent accrued environmental remediation — — — 2,214 — 2,214 Other noncurrent liabilities 3,694 — 3,293 76 — 7,063 Total liabilities 638,120 1,315,752 54,069 12,280 (515,097 ) 1,505,124 Total partners' capital 1,389,669 2,019,700 2,246,282 1,078,182 (5,344,164 ) 1,389,669 Total liabilities and partners' capital $ 2,027,789 $ 3,335,452 $ 2,300,351 $ 1,090,462 $ (5,859,261 ) $ 2,894,793 Condensed Consolidating Sta tements of Operations. For the purposes of the following condensed consolidating statements of operations, we allocate general and administrative expenses recognized at the SMLP parent to the Guarantor Subsidiaries and Non-Guarantor Subsidiaries to reflec t what those entities' results would have been had they operated on a stand-alone basis. Statements of operations for the three months ended March 31, 2018 and 2017 follow. Three months ended March 31, 2018 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Revenues: Gathering services and related fees $ — $ — $ 69,466 $ 14,895 $ — $ 84,361 Natural gas, NGLs and condensate sales — — 26,117 — — 26,117 Other revenues — — 6,727 115 — 6,842 Total revenues — — 102,310 15,010 — 117,320 Costs and expenses: Cost of natural gas and NGLs — — 20,286 — — 20,286 Operation and maintenance — — 22,153 2,451 — 24,604 General and administrative — — 12,287 2,098 — 14,385 Depreciation and amortization 432 — 22,861 3,384 — 26,677 Transaction costs 57 — — — — 57 Gain on asset sales, net — — (74 ) — (74 ) Total costs and expenses 489 — 77,513 7,933 — 85,935 Other expense (7 ) — — — — (7 ) Interest expense — (15,122 ) — — — (15,122 ) Deferred Purchase Price Obligation (21,658 ) — — — — (21,658 ) (Loss) income before income taxes and income from equity method investees (22,154 ) (15,122 ) 24,797 7,077 — (5,402 ) Income tax benefit 171 — — — — 171 Income from equity method investees — — — 1,386 — 1,386 Equity in earnings of consolidated subsidiaries 18,138 33,260 — — (51,398 ) — Net (loss) income $ (3,845 ) $ 18,138 $ 24,797 $ 8,463 $ (51,398 ) $ (3,845 ) Three months ended March 31, 2017 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Revenues: Gathering services and related fees $ — $ — $ 102,513 $ 15,500 $ — $ 118,013 Natural gas, NGLs and condensate sales — — 11,120 — — 11,120 Other revenues — — 6,600 72 — 6,672 Total revenues — — 120,233 15,572 — 135,805 Costs and expenses: Cost of natural gas and NGLs — — 9,052 — — 9,052 Operation and maintenance — — 22,020 1,672 — 23,692 General and administrative — — 12,485 1,647 — 14,132 Depreciation and amortization 154 — 25,242 3,173 — 28,569 Loss on asset sales, net — — 3 — — 3 Long-lived asset impairment — — — 284 — 284 Total costs and expenses 154 — 68,802 6,776 — 75,732 Other income 71 — — — — 71 Interest expense — (16,716 ) — — — (16,716 ) Early extinguishment of debt — (22,020 ) — — — (22,020 ) Deferred Purchase Price Obligation (20,883 ) — — — — (20,883 ) (Loss) income before income taxes and loss from equity method investees (20,966 ) (38,736 ) 51,431 8,796 — 525 Income tax expense (452 ) — — — — (452 ) Loss from equity method investees — — — (656 ) — (656 ) Equity in earnings of consolidated subsidiaries 20,835 59,571 — — (80,406 ) — Net (loss) income $ (583 ) $ 20,835 $ 51,431 $ 8,140 $ (80,406 ) $ (583 ) Conde nsed Consolidating Statements of Cash Flows. Statements of cash flows for the three months ended March 31, 2018 and 2017 follow. March 31, 2018 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Cash flows from operating activities: Net cash (used in) provided by operating activities $ (2,721 ) $ (10,985 ) $ 47,495 $ 17,421 $ — $ 51,210 Cash flows from investing activities: Capital expenditures (297 ) — (39,001 ) (1,480 ) — (40,778 ) Other, net (221 ) — — — — (221 ) Advances to affiliates — (28,718 ) (6,995 ) (15,549 ) 51,262 — Net cash used in investing activities (518 ) (28,718 ) (45,996 ) (17,029 ) 51,262 (40,999 ) Cash flows from financing activities: Distributions to unitholders (45,053 ) — — — — (45,053 ) Borrowings under Revolving Credit Facility — 50,000 — — — 50,000 Repayments under Revolving Credit Facility — (10,000 ) — — — (10,000 ) Debt issuance costs — (4 ) — — — (4 ) Other, net (2,883 ) — (306 ) (29 ) — (3,218 ) Advances from affiliates 51,262 — — — (51,262 ) — Net cash provided by (used in) financing activities 3,326 39,996 (306 ) (29 ) (51,262 ) (8,275 ) Net change in cash and cash equivalents 87 293 1,193 363 — 1,936 Cash and cash equivalents, beginning of period 126 75 1,138 91 — 1,430 Cash and cash equivalents, end of period $ 213 $ 368 $ 2,331 $ 454 $ — $ 3,366 March 31, 2017 SMLP Co-Issuers Guarantor Subsidiaries Non-Guarantor Subsidiaries Consolidating adjustments Total (In thousands) Cash flows from operating activities: Net cash (used in) provided by operating activities $ (2,021 ) $ (27,574 ) $ 75,271 $ 16,773 $ — $ 62,449 Cash flows from investing activities: Capital expenditures (1,003 ) — (6,089 ) (7,336 ) — (14,428 ) Contributions to equity method investees — — — (4,936 ) — (4,936 ) Other, net (361 ) — — — — (361 ) Advances to affiliates (20,185 ) — (72,075 ) — 92,260 — Net cash used in investing activities (21,549 ) — (78,164 ) (12,272 ) 92,260 (19,725 ) Cash flows from financing activities: Distributions to unitholders (44,452 ) — — — — (44,452 ) Borrowings under Revolving Credit Facility — 72,000 — — — 72,000 Repayments under Revolving Credit Facility — (245,000 ) — — — (245,000 ) Debt issuance costs — (6,825 ) — — — (6,825 ) Payment of redemption and call premiums on senior notes — (17,913 ) — — — (17,913 ) Proceeds from ATM Program issuances, net of costs 367 — — — — 367 Contribution from General Partner 113 — — — — 113 Issuance of senior notes — 500,000 — — — 500,000 Tender and redemption of senior notes — (300,000 ) — — — (300,000 ) Other, net (2,051 ) — (91 ) (15 ) — (2,157 ) Advances from affiliates 72,075 25,266 — (5,081 ) (92,260 ) — Net cash provided by (used in) financing activities 26,052 27,528 (91 ) (5,096 ) (92,260 ) (43,867 ) Net change in cash and cash equivalents 2,482 (46 ) (2,984 ) (595 ) — (1,143 ) Cash and cash equivalents, beginning of period 698 51 5,768 911 — 7,428 Cash and cash equivalents, end of period $ 3,180 $ 5 $ 2,784 $ 316 $ — $ 6,285 |