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Financial Information by Business Segment (Tables)
 6 Months Ended
Jun. 30, 2014
Financial Information by Business Segment  
Schedule of revenue from external customers and operating income (loss) and reconciliation to net income

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

June 30,

 

June 30,

 

 

 

2014

 

2013

 

2014

 

2013

 

 

 

(Thousands)

Revenues from external customers:

 

 

 

 

 

 

 

 

 

EQT Production

 

  $

322,100

 

  $

306,132

 

  $

789,845

 

  $

556,643

 

EQT Midstream

 

162,345

 

150,366

 

328,571

 

297,054

 

Third-party transportation and processing costs (a)

 

51,432

 

34,827

 

96,061

 

70,568

 

Less intersegment revenues, net (b)

 

(9,709)

 

(18,232)

 

(26,684)

 

(35,289)

 

Total

 

  $

526,168

 

  $

473,093

 

  $

1,187,793

 

  $

888,976

 

 

 

 

 

 

 

 

 

 

 

Operating income:

 

 

 

 

 

 

 

 

 

EQT Production (c) 

 

  $

144,689

 

  $

105,056

 

  $

421,894

 

  $

179,153

 

EQT Midstream (c)

 

88,527

 

72,246

 

171,596

 

146,460

 

Unallocated expenses (d)

 

(8,445)

 

(15,322)

 

(11,928)

 

(19,154)

 

Total operating income

 

  $

224,771

 

  $

161,980

 

  $

581,562

 

  $

306,459

 

 

Reconciliation of operating income to income from continuing operations:

 

Other income

 

  $

2,579

 

  $

2,041

 

  $

5,130

 

  $

4,322

 

Interest expense

 

31,873

 

37,384

 

63,841

 

75,136

 

Income taxes

 

59,089

 

38,078

 

175,424

 

72,846

 

Income from continuing operations

 

  $

136,388

 

  $

88,559

 

  $

347,427

 

  $

162,799

 

 

 

(a)

 

This amount reflects the reclassification of third-party transportation and processing costs from operating revenues to transportation and processing costs at the consolidated level.

 

 

 

(b)

 

Includes entries to eliminate intercompany natural gas sales from EQT Production to EQT Midstream. The Company also had $9.1 million and $20.0 million for the three and six months ended June 30, 2013, respectively, of intercompany eliminations for transmission and storage services between EQT Midstream and the Company’s previously reported Distribution segment that were recast to discontinued operations as a result of the Equitable Gas Transaction. These recast adjustments had no impact on the Company’s net income for either of the three or six month periods ended June 30, 2013.

 

 

 

(c)

 

Gains on sales / exchanges of assets of $31.0 million and $6.8 million are included in EQT Production and EQT Midstream operating income, respectively, for the three and six months ended June 30, 2014.

 

 

 

(d)

 

Unallocated expenses consist primarily of incentive compensation expense, administrative costs and, for the three and six months ended June 30, 2013, corporate overhead charges previously allocated to the Distribution segment that were reclassified to Headquarters as part of the recast of the 2013 financial information in this Quarterly Report on Form 10-Q.
Schedule of segment assets

 

 

 

As of
June 30,
2014

 

As of
December 31,
2013

 

 

 

(Thousands)

 

Segment assets:

 

 

 

 

 

EQT Production

 

  $

7,191,308

 

  $

6,359,065

 

EQT Midstream

 

2,486,643

 

2,514,429

 

Total operating segments

 

9,677,951

 

8,873,494

 

Headquarters assets, including cash and short-term investments

 

1,707,985

 

918,559

 

Total assets

 

  $

11,385,936

 

  $

9,792,053

 

 
Schedule of depreciation, depletion and amortization and expenditures for segment assets

 

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

 

June 30,

 

 

2014

 

2013

 

2014

 

2013

 

 

(Thousands)

Depreciation, depletion and amortization:

 

 

 

 

 

 

 

 

 

EQT Production

 

$

136,251

 

$

144,073

 

$

267,490

 

$

268,982

 

EQT Midstream

 

21,130

 

18,452

 

42,139

 

36,671

 

Other

 

(162)

 

(52)

 

(299)

 

(144)

 

Total

 

$

157,219

 

$

162,473

 

$

309,330

 

$

305,509

 

 

 

 

 

 

 

 

 

 

 

Expenditures for segment assets (e):

 

 

 

 

 

 

 

 

 

EQT Production (f)

 

$

930,228

 

$

394,391

 

$

1,338,559

 

$

637,566

 

EQT Midstream

 

110,913

 

89,060

 

194,126

 

138,204

 

Other

 

802

 

1,872

 

1,362

 

2,220

 

Total

 

$

1,041,943

 

$

485,323

 

$

1,534,047

 

$

777,990

 

 

(e)     Excludes non-cash capital expenditures of $3.6 million and $5.9 million for the three months ended June 30, 2014 and 2013, respectively, and $8.1 million and $11.9 million for the six months ended June 30, 2014 and 2013, respectively.  The Company capitalizes certain labor overhead costs including a portion of non-cash stock-based compensation expense.

 

(f)      Includes $157.3 million of cash capital expenditures and $353.0 million of non-cash capital expenditures for the exchange of assets with Range Resources Corporation (described in Note K) for the three and six months ended June 30, 2014. Expenditures for segment assets in the EQT Production segment include $550.5 million and $128.9 million for property acquisitions during the three months ended June 30, 2014 and 2013, respectively, and $609.7 million and $141.6 million for property acquisitions during the six months ended June 30, 2014 and 2013, respectively.