Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

Form 10-Q

 

x      Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

for the quarterly period ended September 30, 2011

 

OR

 

o         Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

for the transition period from                     to

 

Commission file number: 000-50067

 

CROSSTEX ENERGY, L.P.

(Exact name of registrant as specified in its charter)

 

 

 

(214) 953-9500

(Registrant’s telephone number, including area code)

 

Indicate by check mark whether registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x

 

As of October 21, 2011, the Registrant had 50,656,490 common units outstanding.

 

 

Table of Contents

 

TABLE OF CONTENTS

 

Item		Description		Page
		PART I—FINANCIAL INFORMATION
1.		Financial Statements		3
2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		25
3.		Quantitative and Qualitative Disclosures About Market Risk		35
4.		Controls and Procedures		38
		PART II—OTHER INFORMATION
1.		Legal Proceedings		38
1A.		Risk Factors		38
6.		Exhibits		39

 

Table of Contents

 

CROSSTEX ENERGY, L.P.

 

Condensed Consolidated Balance Sheets

 

		September 30,			December 31,
		2011			2010
		(Unaudited)
		(In thousands)
ASSETS
Current assets:
Cash and cash equivalents		$	5,562		$	17,697
Accounts receivable:
Trade, net of allowance for bad debt of $1,343 and $163, respectively		24,286			16,350
Accrued revenue and other		155,618			193,669
Fair value of derivative assets		4,160			5,523
Natural gas and natural gas liquids, prepaid expenses and other		11,911			9,741
Total current assets		201,537			242,980
Property and equipment, net of accumulated depreciation of $387,150 and $329,315, respectively		1,217,815			1,215,104
Fair value of derivative assets		288			1,169
Intangible assets, net of accumulated amortization of $186,402 and $151,735, respectively		464,308			498,975
Investment in limited liability company		35,000			—
Other assets, net		25,378			26,712
Total assets		$	1,944,326		$	1,984,940
LIABILITIES AND PARTNERS’ EQUITY
Current liabilities:
Accounts payable, drafts payable and other		$	17,089		$	18,028
Accrued gas purchases		126,171			160,909
Fair value of derivative liabilities		6,453			7,980
Current portion of long-term debt		—			7,058
Other current liabilities		52,962			66,645
Total current liabilities		202,675			260,620
Long-term debt		787,934			711,512
Other long-term liabilities		24,672			26,879
Deferred tax liability		7,462			7,837
Fair value of derivative liabilities		166			1,156
Commitments and contingencies		—			—
Partners’ equity		921,417			976,936
Total liabilities and partners’ equity		$	1,944,326		$	1,984,940

 

See accompanying notes to condensed consolidated financial statements.

 

3

Table of Contents

 

CROSSTEX ENERGY, L.P.

 

Condensed Consolidated Statements of Operations

 

		Three Months Ended September 30,						Nine Months Ended September 30,
		2011			2010			2011			2010
		(Unaudited)
		(In thousands, except per unit amounts)
Revenues		$	517,498		$	454,735		$	1,533,003		$	1,365,441
Operating costs and expenses:
Purchased gas and NGLs		426,539			371,072			1,255,650			1,116,573
Operating expenses		28,126			26,476			81,083			78,365
General and administrative		13,712			11,277			38,111			35,669
(Gain) loss on sale of property		397			(588		)	317			(14,367		)
Loss on derivatives		563			1,582			5,520			6,872
Impairments		—			—			—			1,311
Depreciation and amortization		31,912			28,185			93,200			82,097
Total operating costs and expenses		501,249			438,004			1,473,881			1,306,520
Operating income		16,249			16,731			59,122			58,921
Other income (expense):
Interest expense, net of interest income		(19,507		)	(20,334		)	(59,952		)	(67,188		)
Loss on extinguishment of debt		—			—			—			(14,713		)
Other income		786			109			656			314
Total other expense		(18,721		)	(20,225		)	(59,296		)	(81,587		)
Loss before non-controlling interest and income taxes		(2,472		)	(3,494		)	(174		)	(22,666		)
Income tax provision		(287		)	(161		)	(898		)	(809		)
Net loss		(2,759		)	(3,655		)	(1,072		)	(23,475		)
Less: Net income (loss) attributable to the non-controlling interest		(23		)	13			(130		)	(11		)
Net loss attributable to Crosstex Energy, L.P.		$	(2,736	)	$	(3,668	)	$	(942	)	$	(23,464	)
Preferred interest in net income attributable to Crosstex Energy, L.P.		$	4,558		$	3,676		$	13,382		$	9,926
Beneficial conversion feature attributable to preferred units		$	—		$	—		$	—		$	22,279
General partner interest in net income (loss)		$	(76	)	$	(820	)	$	(709	)	$	(3,596	)
Limited partners’ interest in net income (loss) attributable to Crosstex Energy, L.P.		$	(7,218	)	$	(6,524	)	$	(13,615	)	$	(52,073	)
Net income (loss) attributable to Crosstex Energy, L.P. per limited partners’ unit:
Basic and diluted common unit		$	(0.14	)	$	(0.13	)	$	(0.26	)	$	(1.02	)

 

See accompanying notes to condensed consolidated financial statements.

 

4

Table of Contents

 

CROSSTEX ENERGY, L.P.

 

Consolidated Statements of Comprehensive Income (Loss)

 

		Three Months Ended						Nine Months Ended
		September 30,						September 30,
		2011			2010			2011			2010
		(Unaudited)
		(In thousands)
Net loss		$	(2,759	)	$	(3,655	)	$	(1,072	)	$	(23,475	)
Hedging (gains) losses reclassified to earnings		421			(81		)	1,510			1,637
Adjustment in fair value of derivatives		335			(601		)	(1,200		)	420
Comprehensive loss		(2,003		)	(4,337		)	(762		)	(21,418		)
Comprehensive (income) loss attributable to non-controlling interest		23			(13		)	130			11
Comprehensive loss attributable to Crosstex Energy, L.P.		$	(1,980	)	$	(4,350	)	$	(632	)	$	(21,407	)

 

See accompanying notes to condensed consolidated financial statements.

 

5

Table of Contents

 

CROSSTEX ENERGY, L.P.

 

Consolidated Statements of Changes in Partners’ Equity

Nine Months Ended September 30, 2011

 

																	Accumulated
												General Partner					Other
		Common Units					Preferred Units					Interest					Comprehensive			Non-Controlling
		$			Units		$			Units		$			Units		Income (loss)			Interest			Total
		(Unaudited)
		(In thousands)
Balance, December 31, 2010		$	807,020		50,255		$	146,888		14,706		$	20,979		1,325		$	(859	)	$	2,908		$	976,936
Proceeds from exercise of unit options		513			111		—			—		—			—		—			—			513
Conversion of restricted units for common units, net of units withheld for taxes		(1,798		)	294		—			—		—			—		—			—			(1,798		)
Capital contributions		—			—		—			—		159			9		—			—			159
Stock-based compensation		3,107			—		—			—		2,397			—		—			—			5,504
Distributions		(44,222		)	—		(12,647		)	—		(2,266		)	—		—			—			(59,135		)
Net income (loss)		(13,615		)	—		13,382			—		(709		)	—		—			(130		)	(1,072		)
Hedging gains or losses reclassified to earnings		—			—		—			—		—			—		1,510			—			1,510
Adjustment in fair value of derivatives		—			—		—			—		—			—		(1,200		)	—			(1,200		)
Balance, September 30, 2011		$	751,005		50,660		$	147,623		14,706		$	20,560		1,334		$	(549	)	$	2,778		$	921,417

 

See accompanying notes to condensed consolidated financial statements.

 

6

Table of Contents

 

CROSSTEX ENERGY, L.P.

 

Consolidated Statements of Cash Flows

 

		Nine Months Ended September 30,
		2011			2010
		(Unaudited)
		(In thousands)
Cash flows from operating activities:
Net loss		$	(1,072	)	$	(23,475	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		93,200			82,097
(Gain) loss on sale of property		317			(14,367		)
Impairments		—			1,311
Deferred tax benefit		(375		)	(375		)
Non-cash stock-based compensation		5,504			7,106
Derivatives mark to market interest rate settlement		—			(24,160		)
Non-cash portion of derivatives loss		165			892
Non-cash portion of loss on debt extinguishment		—			5,396
Payment of interest paid-in-kind debt		—			(11,558		)
Amortization of debt issue costs		5,278			5,213
Amortization of discount on notes		1,423			1,212
Changes in assets and liabilities:
Accounts receivable, accrued revenue and other		30,115			37,508
Natural gas and natural gas liquids, prepaid expenses and other		(3,493		)	476
Accounts payable, accrued gas purchases and other accrued liabilities		(47,181		)	(20,967		)
Net cash provided by operating activities		83,881			46,309
Cash flows from investing activities:
Additions to property and equipment		(62,829		)	(29,762		)
Insurance recoveries on property and equipment		—			2,599
Proceeds from sale of property		425			60,053
Investment in limited liability company		(35,000		)	—
Net cash provided by (used in) investing activities		(97,404		)	32,890
Cash flows from financing activities:
Proceeds from borrowings		390,250			990,912
Payments on borrowings		(322,308		)	(1,138,205		)
Payments on capital lease obligations		(2,254		)	(1,671		)
Decrease in drafts payable		(103		)	(5,214		)
Debt refinancing costs		(3,936		)	(28,520		)
Conversion of restricted units, net of units withheld for taxes		(1,798		)	(2,737		)
Distributions to non-controlling interest		—			(261		)
Distribution to partners		(59,135		)	(6,250		)
Proceeds from issuance of preferred units		—			120,786
Proceeds from exercise of unit options		513			667
Contributions from general partner		159			2,792
Net cash provided by (used in) financing activities		1,388			(67,701		)
Net increase (decrease) in cash and cash equivalents		(12,135		)	11,498
Cash and cash equivalents, beginning of period		17,697			779
Cash and cash equivalents, end of period		$	5,562		$	12,277
Cash paid for interest		$	70,074		$	63,769
Cash paid for income taxes		$	905		$	1,533

 

See accompanying notes to condensed consolidated financial statements.

 

7

Table of Contents

 

CROSSTEX ENERGY, L.P.

 

Notes to Condensed Consolidated Financial Statements

 

September 30, 2011

(Unaudited)

 

(1) General

 

Unless the context requires otherwise, references to “we,” “us,” “our” or the “Partnership” mean Crosstex Energy, L.P. and its consolidated subsidiaries.

 

Crosstex Energy, L.P., a Delaware limited partnership formed on July 12, 2002, is engaged in the gathering, transmission, processing and marketing of natural gas and natural gas liquids (NGLs). The Partnership connects the wells of natural gas producers in the geographic areas of its gathering systems in order to gather for a fee or purchase the gas production, processes natural gas for the removal of NGLs, transports natural gas and NGLs and ultimately provides natural gas and NGLs to a variety of markets. In addition, the Partnership purchases natural gas and NGLs from producers not connected to its gathering systems for resale and markets natural gas and NGLs on behalf of producers for a fee.

 

Crosstex Energy GP, LLC is the general partner of the Partnership. Crosstex Energy GP, LLC is a direct, wholly-owned subsidiary of Crosstex Energy, Inc. (CEI).

 

(a) Basis of Presentation

 

The accompanying condensed consolidated financial statements are prepared in accordance with the instructions to Form 10-Q, are unaudited and do not include all the information and disclosures required by generally accepted accounting principles for complete financial statements. All adjustments that, in the opinion of management, are necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of results of operations for a full year. All significant intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications have been made to the consolidated financial statements for the prior year to conform to the current presentation. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Partnership’s annual report on Form 10-K for the year ended December 31, 2010.

 

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management of the Partnership to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from these estimates.

 

(b) Investment in Limited Liability Company

 

On June 22, 2011, the Partnership entered into a limited liability agreement with Howard Energy Partners (“HEP”) for an initial capital contribution of $35.0 million in exchange for an individual ownership interest in HEP of approximately 35.0%.  In addition the Partnership’s contribution, an unrelated party also provided a capital contribution of $35.0 million for a 35.0% ownership interest in HEP with HEP management and a few private investors owning the remaining 30.0% interest.  HEP operates and manages midstream services as well as pipeline and plant construction primarily in the Eagle Ford Shale in south Texas.  This investment in HEP is accounted for under the equity method of accounting and is reflected on the balance sheet as “Investment in limited liability company.”  Per the terms of the agreement, the Partnership will not recognize any income from this investment until HEP’s income exceeds approximately $9.9 million on an inception to date basis due to preferred interests owned by HEP management.  If HEP has losses on an inception to date basis, the Partnership will recognize 39.3% of the losses.

 

8

Table of Contents

 

CROSSTEX ENERGY, L.P.

 

Notes to Condensed Consolidated Financial Statements

 

(2) Long-Term Debt

 

As of September 30, 2011 and December 31, 2010, long-term debt consisted of the following (in thousands):

 

		September 30,			December 31,
		2011			2010
Bank credit facility (due 2016), interest based on Prime and/or LIBOR plus an applicable margin, interest rate at September 30, 2011 and December 31, 2010 was 2.73% and 4.0%, respectively		$	75,000		$	—
Senior unsecured notes (due 2018), net of discount of $12.1 million and $13.5 million, respectively, which bear interest at the rate of 8.875%		712,934			711,512
Series B secured note assumed in the Eunice transaction, which bore interest at the rate of 9.5%		—			7,058
		787,934			718,570
Less current portion		—			(7,058		)
Debt classified as long-term		$	787,934		$	711,512

 

Credit Facility. As of September 30, 2011, there was $69.9 million in outstanding letters of credit and $75.0 million borrowed under the Partnership’s bank credit facility, leaving approximately $340.1 million available for future borrowing based on the borrowing capacity of $485.0 million.

 

In May 2011, the Partnership amended its bank credit facility. The borrowing capacity under the credit facility was increased from $420.0 million to $485.0 million and the maturity was extended from February 2014 to May 2016. Additionally, the amendment to the Partnership’s credit facility, among other things, (i) increased the maximum permitted leverage ratios during certain fiscal quarters, (ii) decreased the minimum consolidated interest rate coverage ratio during certain fiscal quarters and (iii) decreased the interest rate the Partnership pays on the obligations under the credit facility. Also under the amended credit facility, the Partnership increased the accordion from $100.0 million to $150.0 million, which permits the Partnership to increase its borrowing capacity if any bank in the credit facility or a new bank is willing to undertake such commitment.

 

In July 2011, the Partnership amended its bank credit facility again. The amendment to the Partnership’s credit facility, among other things, (i) permitted Apache Midstream LLC (“Apache”) to have a first priority lien on certain assets that are the subject of a joint interest arrangement between Apache and Crosstex Permian, LLC (“Permian”) (including a new-build natural gas processing facility and related assets in the Permian Basin in West Texas) to secure obligations that Permian would owe to Apache should Permian fail to fund its obligations pursuant to the joint interest arrangement and (ii) increased the Partnership’s ability to make investments in joint ventures and subsidiaries without such joint ventures and subsidiaries becoming guarantors under the credit agreement.

 

The credit facility is guaranteed by substantially all of the Partnership’s subsidiaries and is secured by first priority liens on substantially all of the Partnership’s assets and those of the guarantors, including all material pipeline, gas gathering and processing assets, all material working capital assets and a pledge of all of the Partnership’s equity interests in substantially all of its subsidiaries and its interest in HEP.

 

The Partnership may prepay all loans under the amended credit facility at any time without premium or penalty (other than customary LIBOR breakage costs), subject to certain notice requirements.

 

Under the amended credit facility, borrowings bear interest at the Partnership’s option at the Eurodollar Rate (the British Bankers Association LIBOR Rate) plus an applicable margin or the Base Rate (the highest of the Federal Funds Rate plus 0.50%, the 30-day Eurodollar Rate plus 1.0%, or the administrative agent’s prime rate) plus an applicable margin. The Partnership pays a per annum fee (as described below) on all letters of credit issued under the amended credit facility and a commitment fee of between 0.375% and 0.50% per annum on the unused availability under the amended credit facility. The commitment fee, letter of credit fee and the applicable margins for the interest rate vary quarterly based on the Partnership’s leverage ratio (as defined in the credit facility, being generally computed as the ratio of total funded debt to consolidated earnings before interest, taxes, depreciation, amortization and certain other non-cash charges) and are as follows:

 

		Base Rate		Eurodollar Rate		Letter of Credit
Leverage Ratio		Loans		Loans		Fees
Greater than or equal to 4.50 to 1.00		2.00	%	3.00	%	3.00	%
Greater than or equal to 4.00 to 1.00 and less than 4.50 to 1.00		1.75	%	2.75	%	2.75	%
Greater than or equal to 3.50 to 1.00 and less than 4.00 to 1.00		1.50	%	2.50	%	2.50	%
Greater than or equal to 3.00 to 1.00 and less than 3.50 to 1.00		1.25	%	2.25	%	2.25	%
Less than 3.00 to 1.00		1.00	%	2.00	%	2.00	%

 

The amended credit facility includes financial covenants that are tested on a quarterly basis, based on the rolling four-quarter period that ends on the last day of each fiscal quarter.  The maximum permitted leverage ratio is 4.75 to 1.00.  The maximum permitted senior leverage ratio (as defined in the credit facility, but generally computed as the ratio of total secured funded debt to

 

9

Table of Contents

 

CROSSTEX ENERGY, L.P.

 

Notes to Condensed Consolidated Financial Statements

 

consolidated earnings before interest, taxes, depreciation, amortization and certain other non-cash charges), is 2.75 to 1.00.  The minimum consolidated interest coverage ratio (as defined in the credit facility, but generally computed as the ratio of consolidated earnings before interest, taxes, depreciation, amortization and certain other non-cash charges to consolidated interest charges) is as follows:

 

·                      2.25 to 1.00 for the fiscal quarters ending September 30, 2011, December 31, 2011, March 31, 2012 and June 30, 2012;

 

·                      2.50 to 1.00 for September 30, 2012 and each fiscal quarter thereafter.

 

All other material terms of the credit facility are described in the Partnership’s Annual Report on Form 10-K filing for the year ended December 31, 2010. The Partnership expects to be in compliance with all credit facility covenants for at least the next twelve months.

 

Series B Secured Note. On October 20, 2009, the Partnership acquired the Eunice natural gas liquids processing plant and fractionation facility which included an $18.1 million series B secured note. We paid $11.0 million of principal on the series B secured note in May 2010 and paid the remaining $7.1 million in May 2011.

 

Non Guarantors.  The senior unsecured notes are jointly and severally guaranteed by each of the Partnership’s current material subsidiaries (the “Guarantors”), with the exception of its regulated Louisiana subsidiaries (which may only guarantee up to $500.0 million of the Partnership’s debt), CDC (the Partnership’s joint venture in Denton County, Texas which is not 100% owned by the Partnership) and Crosstex Energy Finance Corporation (a wholly owned Delaware corporation that was organized for the sole purpose of being a co-issuer of certain of the Partnership’s indebtedness, including the senior unsecured notes). Guarantors may not sell or otherwise dispose of all or substantially all of their properties or assets, or consolidate with or merge into another company if such a sale would cause a default under the terms of the senior unsecured notes. Since certain wholly owned subsidiaries do not guarantee the senior unsecured notes, the condensed consolidating financial statements of the guarantors and non-guarantors for the three and  nine months ended September 30, 2011 and 2010 are disclosed below in accordance with Rule 3-10 of Regulation S-X.

 

Condensed Consolidating Balance Sheets

September 30, 2011

 

		Guarantors			Non Guarantors			Elimination			Consolidated
		(In thousands)
ASSETS
Total current assets		$	187,416		$	14,121		$	—		$	201,537
Property, plant and equipment, net		999,245			218,570			—			1,217,815
Total other assets		524,971			3			—			524,974
Total assets		$	1,711,632		$	232,694		$	—		$	1,944,326
LIABILITIES & PARTNERS’ CAPITAL
Total current liabilities		$	195,541		$	7,134		$	—		$	202,675
Long-term debt		787,934			—			—			787,934
Other long-term liabilities		32,300			—			—			32,300
Partners’ capital		695,857			225,560			—			921,417
Total liabilities & partners’ capital		$	1,711,632		$	232,694		$	—		$	1,944,326

 

December 31, 2010

 

		Guarantors			Non Guarantors			Elimination			Consolidated
		(In thousands)
ASSETS
Total current assets		$	229,997		$	12,983		$	—		$	242,980
Property, plant and equipment, net		987,018			228,086			—			1,215,104
Total other assets		526,853			3			—			526,856
Total assets		$	1,743,868		$	241,072		$	—		$	1,984,940
LIABILITIES & PARTNERS’ CAPITAL
Total current liabilities		$	254,460		$	6,160		$	—		$	260,620
Long-term debt		711,512			—			—			711,512
Other long-term liabilities		35,872			—			—			35,872
Partners’ capital		742,024			234,912			—			976,936
Total liabilities & partners’ capital		$	1,743,868		$	241,072		$	—		$	1,984,940

 

10

Table of Contents

 

CROSSTEX ENERGY, L.P.

 

Notes to Condensed Consolidated Financial Statements

 

Condensed Consolidating Statements of Operations

For the Three Months Ended September 30, 2011

 

		Guarantors			Non Guarantors			Elimination			Consolidated
		(In thousands)
Total revenues		$	501,866		$	21,287		$	(5,655	)	$	517,498
Total operating costs and expenses		(497,149		)	(9,755		)	5,655			(501,249		)
Operating income		4,717			11,532			—			16,249
Interest expense, net		(19,507		)	—			—			(19,507		)
Other income		786			—			—			786
Income (loss) before non-controlling interest and income taxes		(14,004		)	11,532			—			(2,472		)
Income tax provision		(283		)	(4		)	—			(287		)
Net loss attributable to non-controlling interest		—			23			—			23
Net income (loss) attributable to Crosstex Energy, L.P.		$	(14,287	)	$	11,551		$	—		$	(2,736	)

 

For the Three Months Ended September 30, 2010

 

		Guarantors			Non Guarantors			Elimination			Consolidated
		(In thousands)
Total revenues		$	439,264		$	20,765		$	(5,294	)	$	454,735
Total operating costs and expenses		(434,949		)	(8,349		)	5,294			(438,004		)
Operating income		4,315			12,416			—			16,731
Interest expense, net		(20,334		)	—			—			(20,334		)
Other income		109			—			—			109
Income (loss) before non-controlling interest and income taxes		(15,910		)	12,416			—			(3,494		)
Income tax provision		(159		)	(2		)	—			(161		)
Net income attributable to non-controlling interest		—			(13		)	—			(13		)
Net income (loss) attributable to Crosstex Energy, L.P.		$	(16,069	)	$	12,401		$	—		$	(3,668	)

 

11

Table of Contents

 

CROSSTEX ENERGY, L.P.

 

Notes to Condensed Consolidated Financial Statements

 

For the Nine Months Ended September 30, 2011

 

		Guarantors			Non Guarantors			Elimination			Consolidated
		(In thousands)
Total revenues		$	1,487,910		$	65,148		$	(20,055	)	$	1,533,003
Total operating costs and expenses		(1,464,720		)	(29,216		)	20,055			(1,473,881		)
Operating income		23,190			35,932			—			59,122
Interest expense, net		(59,952		)	—			—			(59,952		)
Other income		656			—			—			656
Income (loss) before non-controlling interest and income taxes		(36,106		)	35,932			—			(174		)
Income tax provision		(886		)	(12		)	—			(898		)
Net loss attributable to non-controlling interest		—			130			—			130
Net income (loss) attributable to Crosstex Energy, L.P.		$	(36,992	)	$	36,050		$	—		$	(942	)

 

 

For the Nine Months Ended September 30, 2010

 

		Guarantors			Non Guarantors			Elimination			Consolidated
		(in thousands)
Total revenues		$	1,321,810		$	62,930		$	(19,299	)	$	1,365,441
Total operating costs and expenses		(1,299,802		)	(26,017		)	19,299			(1,306,520		)
Operating income		22,008			36,913			—			58,921
Interest expense, net		(67,182		)	(6		)	—			(67,188		)
Other expense		(14,399		)	—			—			(14,399		)
Income (loss) before non-controlling interest and income taxes		(59,573		)	36,907			—			(22,666		)
Income tax provision		(801		)	(8		)	—			(809		)
Net loss attributable to non-controlling interest		—			11			—			11
Net income (loss) attributable to Crosstex Energy, L.P.		$	(60,374	)	$	36,910		$	—		$	(23,464	)

 

Condensed Consolidating Statements of Cash Flow

For the Nine Months Ended September 30, 2011

 

		Guarantors			Non Guarantors			Elimination			Consolidated
		(In thousands)
Net cash flows provided by operating activities		$	35,676		$	48,205		$	—		$	83,881
Net cash flows used in investing activities		$	(95,202	)	$	(2,202	)	$	—		$	(97,404	)
Net cash flows provided by (used in) financing activities		$	1,388		$	(45,274	)	$	45,274		$	1,388

 

For the Nine Months Ended September 30, 2010

 

		Guarantors			Non Guarantors			Elimination			Consolidated
		(In thousands)
Net cash flows provided by operating activities		$	2,965		$	43,344		$	—		$	46,309
Net cash flows provided by (used in) investing activities		$	39,924		$	(7,034	)	$	—		$	32,890
Net cash flows provided by (used in) financing activities		$	(67,441	)	$	(36,571	)	$	36,311		$	(67,701	)

 

12