Exhibit 99.1 Crosstex Energy Reports Third Quarter Results DALLAS, Nov. 8 /PRNewswire-FirstCall/ -- The Crosstex Energy companies, Crosstex Energy, L.P. (Nasdaq: XTEX) (the Partnership) and Crosstex Energy, Inc. (Nasdaq: XTXI) (the Corporation) today reported solid growth in the third quarter of 2004. "We continue to realize substantial growth and solid returns every quarter, and the credit goes to the tremendous group of employees at Crosstex," said Barry E. Davis, President and Chief Executive Officer of the Crosstex Energy companies. "I believe we have the best people in the industry on our team, and our determination, loyalty and expertise have put us in the leadership position we are in today." Crosstex Energy, L.P. Financial Results The Partnership reported net income of $5.9 million, or $0.23 per limited partner unit, in the quarter ended September 30, 2004, compared to net income in the third quarter of 2003 of $3.9 million, or $0.22 per unit. The Partnership's Distributable Cash Flow for the quarter was $10.4 million, or 2.26 times the amount required to cover its Minimum Quarterly Distribution of $0.25 per unit, and 1.11 times the amount required to cover its recently increased distribution of $0.43 per unit. This is an increase of $1.8 million, or 20.7 percent, over Distributable Cash Flow of $8.6 million in the 2003 third quarter. Distributable Cash Flow is a non-GAAP financial measure and is explained in greater detail under "Non-GAAP Financial Information." Also, in the tables at the end of this release is a reconciliation of this measure to net income. The growth in Distributable Cash Flow was driven by growth in the Partnership's gross margin, to $29.1 million compared to $17.3 million in the corresponding 2003 period, an increase of 68.3 percent. Gross margin from the Midstream business segment increased by $10.3 million, or 84.4 percent, to $22.5 million, due to growth in on-system gathering and transmission volumes of 94 percent, and to growth in processed volumes of 219 percent. The acquisition of LIG Pipeline Company and its subsidiaries on April 1, 2004 was the main driver of growth in Midstream gross margins. LIG contributed $8.8 million to gross margin in the quarter. Gross margin from the Treating segment increased by $1.5 million, or 30.0 percent, to $6.7 million. Improvements in margins of the Seminole plant provided $323 thousand of the increase. Growth in the number of treating plants in service from 45 at the end of the third quarter of 2003 to 67 at the end of the third quarter of 2004 created the remaining increase in Treating margins. Crosstex Energy, Inc. Financial Results The Corporation reported net income of $1.7 million for the third quarter of 2004, compared to net income of $11.4 million for the respective period in 2003. Net income for the third quarter of 2003 included a gain on issuance of units of the Partnership of $18.1 million related to the Partnership's unit offering. The Corporation's income before income taxes and interest of non-controlling partners in the Partnership's net income was $4.6 million in the third quarter of 2004 and $2.9 million in the third quarter of 2003. The Corporation's share of distributions, including distributions to its ten million limited partner units, its two percent general partner interest, and the incentive distribution rights, is $6.0 million for the third quarter (payable on November 14, 2004). Its share of the distribution in the third quarter of 2003 was $4.0 million. The recently announced increase in the Partnership's distribution increased the Corporation's share of the distribution by $0.3 million, from $5.7 million to $6.0 million. Earnings Call Crosstex will hold its quarterly conference call to discuss first quarter results today at 1:00 pm Central Time (2:00 pm Eastern Time). The dial-in number for the call is 800-706-7748, passcode Crosstex. A live Webcast of the call can be accessed on the investor information page of Crosstex Energy's Web site at http://www.crosstexenergy.com. The call will be available for replay for 30 days by dialing 888-286-8010, passcode 47107072. A replay of the broadcast will also be available on the Partnership's Web site. About the Crosstex Energy Companies Crosstex Energy, L.P., a mid-stream natural gas company headquartered in Dallas, operates over 4,500 miles of pipeline, five processing plants, and over 60 natural gas amine treating plants. Crosstex currently provides services for over 1.5 BCF/day of natural gas. Crosstex Energy Inc. owns the general partner, a 54.2 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 tables. 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 believes are reasonable. However, the Partnership's assumptions and expectations are subject to a wide range of business risks, so it 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 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 NGL 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; and (6) the Partnership may not adequately address construction and operating risks. The Partnership has no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise. Contact: Barry E. Davis, President and Chief Executive Officer William W. Davis, Executive V.P. and Chief Financial Officer Phone: (214) 953-9500 CROSSTEX ENERGY, L.P. Selected Financial and Operating Data (All amounts in thousands except per unit numbers) Quarter Ended Nine Months Ended September 30, September 30, 2004 2003 2004 2003 Revenues Midstream $501,004 $276,222 $1,327,181 $745,567 Treating 7,880 6,976 22,592 17,453 508,884 283,198 1,349,773 763,020 Cost of Gas Midstream 478,536 264,035 1,266,624 715,514 Treating 1,229 1,860 4,092 6,311 479,765 265,895 1,270,716 721,825 Gross Margin 29,119 17,303 79,057 41,195 Operating Expenses 10,013 5,462 26,542 12,007 General & Administrative 4,907 1,721 13,236 5,112 Profit on Energy Trading Activities (766) (646) (1,792) (1,491) Stock Based Compensation 288 1,577 766 4,649 (Gain) Loss on Sale of Property (287) -- (12) -- Depreciation and Amortization 6,160 4,031 16,499 9,077 Total 20,315 12,145 55,239 29,354 Operating Income 8,804 5,158 23,818 11,841 Interest Expense (2,872) (1,321) (6,214) (2,196) Other Income 13 51 (12) 50 Total Other Income (Expense) (2,859) (1,270) (6,226) (2,146) Net Income $5,945 $3,888 $17,592 $9,695 General Partner Share of Net Income $1,563 $450 $4,005 $621 Limited Partners Share of Net Income $4,382 $3,438 $13,587 $9,074 Net Income per Limited Partners' Unit $0.23 $0.22 $0.73 $0.60 Weighted Average Limited Partners' Units Outstanding (Diluted) 18,662 15,860 18,607 15,096 CROSSTEX ENERGY. L.P. Reconciliation of Net Income to Distributable Cash Flow (All amounts in thousands except ratios) Quarter Ended Nine Months Ended September 30, September 30, 2004 2003 2004 2003 Net Income $ 5,945 $ 3,888 $17,592 $ 9,695 Depreciation and Amortization (1) 6,112 4,031 16,374 9,077 Stock Based Compensation 288 1,577 766 4,649 Loss (Gain) on Sale of Property (287) -- (12) -- Proceeds from Sale of Property 385 -- 611 -- Deferred Tax Benefit (168) -- (168) -- Cash Flow 12,275 9,496 35,163 23,421 Maintenance Capital Expenditures (1,842) (852) (4,814) (2,571) Distributable Cash Flow $10,433 $ 8,644 $30,349 $ 20,850 Minimum Quarterly Distribution (MQD) $ 4,613 $ 4,605 $13,840 $ 12,054 Distributable Cash Flow/MQD 2.26 1.88 2.19 1.73 Actual Distribution $ 9,439 $ 6,834 $26,868 $ 14,712 Distribution Coverage 1.11 1.26 1.13 1.42 (1) Excludes minority interest share of depreciation and amortization of $48,000 and $125,000 for the three and nine months ended September 30, 2004, respectively. CROSSTEX ENERGY, L.P. Operating Data (All volumes, except Seminole Plant, in MMBtu/d) Quarter Ended Nine Months Ended September 30, September 30, Pipeline Throughput 2004 2003 2004 2003 Gulf Coast Transmission 63,000 74,000 78,000 81,000 Vanderbilt 61,000 55,000 62,000 45,000 CCNG Transmission 198,000 170,000 180,000 166,000 CCNG Transmission - Hallmark 103,000 62,000 102,000 52,000 Gregory Gathering 127,000 163,000 137,000 150,000 Mississippi 78,000 84,000 78,000 84,000 Arkoma 20,000 15,000 19,000 12,000 LIG Pipeline & Marketing 628,000 N/A 594,000 (1) N/A Other Midstream 31,000 52,000 35,000 53,000 Total Gathering and Transmission Volume 1,309,000 675,000 1,285,000 643,000 Natural Gas Processed Gregory Processing 100,000 106,000 110,000 98,000 Conroe Processing 25,000 28,000 26,000 28,000 LIG Processing 303,000 N/A 283,000 (1) N/A Total Processed Volume 428,000 134,000 419,000 126,000 Total On-System Volumes 1,737,000 809,000 1,704,000 769,000 Producer Services Volumes 224,000 274,000 209,000 263,000 Treating Volumes (2) 78,000 94,000 80,000 91,000 Treating Plants in Service (3) 67 45 67 45 Seminole Plant (Mcf/d of CO(2)) 21,000 18,000 21,000 18,000 (1) Represents activity since April 1, 2004 acquisition. (2) Represent volumes for treating plants operated by us whereby we receive a fee based on the volumes treated. (3) Plants in service represent plants in service on the last day of the quarter. CROSSTEX ENERGY, INC. Selected Financial and Operating Data (All amounts in thousands except per share numbers) Three Months Ended Nine Months Ended September 30, September 30, 2004 2003 2004 2003 Revenues Midstream $501,004 $276,222 $1,327,181 $745,567 Treating 7,880 6,976 22,592 17,453 508,884 283,198 1,349,773 763,020 Cost of Gas Midstream 478,536 264,035 1,266,624 715,514 Treating 1,229 1,860 4,092 6,311 479,765 265,895 1,270,716 721,825 Gross Margin 29,119 17,303 79,057 41,195 Operating Expenses 10,018 6,467 26,570 13,061 General and Administrative 5,263 2,720 14,117 7,392 Impairments 981 -- 981 -- Stock Based Compensation 289 1,577 769 4,649 (Gain) Loss on Sale of Property (287) -- (12) -- (Profit) Loss on Energy Trading Activities (766) (1,614) (1,792) (1,491) Depreciation and Amortization 6,160 4,105 16,499 9,301 Total 21,658 13,255 57,132 32,912 Operating Income 7,461 4,048 21,925 8,283 Interest Expense (2,869) (1,247) (6,166) (1,978) Other Income 50 51 254 50 Total Other Income (Expense) (2,819) (1,196) (5,912) (1,928) Income Before Income Taxes and Interest of Non-controlling Partners in the Partnership's Net Income 4,642 2,852 16,013 6,355 Gain on Issuance of Units of the Partnership -- 18,080 -- 18,080 Income Tax Provision (957) (8,228) (3,504) (8,833) Interest of Non-controlling Partners in the Partnership's Net Income (2,005) (1,328) (6,216) (3,104) Net Income $ 1,680 $ 11,376 $ 6,293 $ 12,498 Preferred Stock Dividends $ -- $ 866 $ -- $ 2,699 Net Income (Loss) Available to Common $ 1,680 $ 10,510 $ 6,293 $ 9,799 Diluted Earnings (Loss) per Common Share $ 0.13 $ 0.92 $ 0.49 $ 1.02 Weighted Average Shares Outstanding: Diluted 12,918 12,333 12,892 12,246 SOURCE Crosstex Energy, Inc. -0- 11/08/2004 /CONTACT: Barry E. Davis, President and Chief Executive Officer, or William W. Davis, Executive V.P. and Chief Financial Officer, both of Crosstex Energy, Inc., +1-214-953-9500/ /Web site: http://www.crosstexenergy.com / (XTEX XTXI) CO: Crosstex Energy, Inc.; Crosstex Energy, L.P. ST: Texas IN: FIN OIL SU: ERN CCA