Exhibit 99.1
[LOGO OF CROSSTEX]
FOR IMMEDIATE RELEASE Contact: Jill McMillan
March 20, 2006 Phone: 214-721-9271
jill.mcmillan@crosstexenergy.com
CROSSTEX ENERGY ANNOUNCES GUIDANCE FOR 2006;
COMPANY HOSTS SECOND ANNUAL ANALYST MEETING
DALLAS, March 20, 2006 --- The Crosstex Energy companies, Crosstex Energy, L.P.
(NasdaqNM: XTEX) (the Partnership) and Crosstex Energy, Inc. (NasdaqNM: XTXI)
(the Corporation), are hosting their second annual analyst meeting today at The
Stockyards Hotel in Fort Worth, Texas. The analyst meeting will showcase several
members of Crosstex's senior management team and will include discussions
concerning strategic planning, industry trends and market opportunities, as well
as provide 2006 guidance.
"As Crosstex continues to experience rapid growth, our analyst meeting allows us
to keep our shareholders well informed on our current and future plans to
maximize growth opportunities and maintain our success," stated Barry E. Davis,
President and Chief Executive Officer. "We continue our commitment to open
communication with our investors, remaining accountable to our partners in
success."
2006 GUIDANCE
The Partnership anticipates it will generate net income in 2006 of between $18.0
million and $26.0 million, and its estimate of Distributable Cash Flow for the
year is in the range of $84.5 million to $95.5 million. Total maintenance
capital expenditures are expected to be between $10 and $14 million in 2006.
The Partnership currently expects to pay total distributions for this year
between $2.10 and $2.20 per unit. Based on that range the Corporation would
receive total distributions between $40.6 million and $44.3 million from the
Partnership. The Corporation anticipates direct cash expenses associated with
its operations outside of the Partnership of approximately $1.5 million. The
Corporation expects that it will incur only nominal current year income tax
expense due to tax loss carryforwards and other tax benefits it expects to use
in 2006. However, it will continue to set its dividends as if it were a
taxpayer. Therefore, it expects to pay dividends of between $2.40 and $2.65 per
share in 2006.
WEBCAST/CONFERENCE CALL
The meeting will also be available live by conference call or webcast for those
not able to attend. The dial-in number for the call is 866-713-8563, passcode
56314586. The call will start on Monday, March 20 at 8:30 a.m. CST and continue
until 12 p.m. CST. A live webcast of the call can be accessed on the investor
relations page of Crosstex Energy's website at www.crosstexenergy.com. The call
will also be available for replay for 30 days by dialing 888-286-8010, passcode
84439270, or by going to the investor relations events page of the Company's
website. The PowerPoint presentations for today's analyst meeting have also been
posted on www.crosstexenergy.com under Investor Information.
-More-
CROSSTEX ENERGY ANNOUNCES GUIDANCE FOR 2006;
COMPANY HOSTS SECOND ANNUAL ANALYST MEETING
PAGE 2
ABOUT THE CROSSTEX ENERGY COMPANIES
Crosstex Energy, L.P., a mid-stream natural gas company headquartered in Dallas,
operates over 5,000 miles of pipeline, nine processing plants, four
fractionators, and approximately 150 natural gas amine treating plants and 22
dew point control plants. Crosstex currently provides services for over 3.0
Bcf/day of natural gas, or approximately 6.0 percent of marketed U.S. daily
production based on August 2005 Department of Energy data.
Crosstex Energy, Inc. owns the two percent general partner interest, an
approximately 38 percent limited partner interest, and the incentive
distribution rights of Crosstex Energy, L.P.
Additional information about the Crosstex companies can be found at
http://www.crosstexenergy.com.
NON-GAAP FINANCIAL INFORMATION
This press release contains non-generally accepted accounting principle
financial measures of earnings before non-cash charges and less maintenance
capital expenditures, which we refer to as Distributable Cash Flow. The amounts
included in the calculation of these measures are computed in accordance with
generally accepted accounting principles (GAAP), with the exception of
maintenance capital expenditures. Maintenance capital expenditures are capital
expenditures made to replace partially or fully depreciated assets in order to
maintain the existing operating capacity of our assets and to extend their
useful lives. We believe this measure is useful to investors because it may
provide users of this financial information with meaningful comparisons between
current results and prior reported results and a meaningful measure of the
Partnership's cash flow after it has satisfied the capital and related
requirements of its operations. Distributable Cash Flow is not a measure of
financial performance or liquidity under GAAP. It should not be considered in
isolation or as an indicator of the Partnership's performance. Furthermore, it
should not be seen as a measure of liquidity or a substitute for metrics
prepared in accordance with GAAP. Our reconciliation of this measure to net
income is included in the following table.
This press release contains forward-looking statements identified by the use of
words such as "forecast," "anticipate," "plan" and "estimate." These statements
are based on currently available information and assumptions and expectations
that the Partnership and the Corporation believe are reasonable. However, the
assumptions and expectations are subject to a wide range of business risks, so
they can give no assurance that actual performance will fall within the forecast
ranges. Among the key risks that may bear directly on the Partnership's and the
Corporation's results of operation and financial condition are: (1) the amount
of natural gas transported in the Partnership's gathering and transmission lines
may decline as a result of competition for supplies, reserve declines and
reduction in demand from key customers and markets; (2) the level of the
Partnership's processing and treating operations may decline for similar
reasons; (3) fluctuations in natural gas and natural gas liquids prices may
occur due to weather and other natural and economic forces; (4) there may be a
failure to successfully integrate new acquisitions; (5) the Partnership's credit
risk management efforts may fail to adequately protect against customer
nonpayment; (6) natural disasters such as hurricanes may significantly disrupt
operations; and (7) the Partnership may not adequately address construction and
operating risks. The Partnership and the Corporation have no obligation to
publicly update or revise any forward-looking statement, whether as a result of
new information, future events, or otherwise.
(Table follows).
CROSSTEX ENERGY ANNOUNCES GUIDANCE FOR 2006;
COMPANY HOSTS SECOND ANNUAL ANALYST MEETING
PAGE 3
CROSSTEX ENERGY, L.P.
FORECAST FOR 2006 NET INCOME
RECONCILIATION TO DISTRIBUTABLE CASH FLOW
(In millions)
RANGE
-------------------
LOW HIGH
-------- --------
Net Income $ 18.0 $ 26.0
Interest 41.0 40.0
Depreciation and Amortization 76.0 76.0
Stock Based Compensation (A) 9.0 8.0
Adjusted Cash Flow 144.0 150.0
Interest 41.0 40.0
Authorization of Net Cost 4.5 4.5
Maintenance Capital Expenditures 14.0 10.0
Distributable Cash Flow $ 84.5 $ 95.5
(A) Stock based compensation expense is based on current generally accepted
accounting principles. The Partnership has not yet evaluated the impact of
complying with FAS 123 (revised 2005), which will require the expensing of
options based upon fair value measurement beginning with the partnership's
third quarter financial results.