Company Quick10K Filing
Antero Midstream GP
Price11.06 EPS-0
Shares506 P/E-30
MCap5,601 P/FCF13
Net Debt2,658 EBIT-219
TEV8,259 TEV/EBIT-38
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-06-30 Filed 2020-07-30
10-Q 2020-03-31 Filed 2020-04-29
10-K 2019-12-31 Filed 2020-02-12
10-Q 2019-09-30 Filed 2019-10-30
10-Q 2019-06-30 Filed 2019-07-31
10-Q 2019-03-31 Filed 2019-05-01
10-K 2018-12-31 Filed 2019-02-13
10-Q 2018-09-30 Filed 2018-10-31
10-Q 2018-06-30 Filed 2018-08-01
10-Q 2018-03-31 Filed 2018-04-25
10-K 2017-12-31 Filed 2018-02-13
10-Q 2017-09-30 Filed 2017-11-01
10-Q 2017-06-30 Filed 2017-08-02
10-Q 2017-03-31 Filed 2017-06-02
8-K 2020-08-25 Regulation FD
8-K 2020-08-12 Regulation FD
8-K 2020-07-29 Earnings, Exhibits
8-K 2020-06-17
8-K 2020-05-12
8-K 2020-04-29
8-K 2020-03-26
8-K 2020-03-24
8-K 2020-03-23
8-K 2020-02-12
8-K 2019-12-16
8-K 2019-12-08
8-K 2019-12-03
8-K 2019-11-06
8-K 2019-10-29
8-K 2019-09-18
8-K 2019-08-12
8-K 2019-07-31
8-K 2019-07-01
8-K 2019-06-28
8-K 2019-06-25
8-K 2019-06-17
8-K 2019-06-10
8-K 2019-05-31
8-K 2019-05-14
8-K 2019-05-01
8-K 2019-04-15
8-K 2019-04-05
8-K 2019-04-01
8-K 2019-03-12
8-K 2019-03-08
8-K 2019-03-04
8-K 2019-02-20
8-K 2019-02-20
8-K 2019-02-14
8-K 2019-02-13
8-K 2019-02-05
8-K 2019-01-31
8-K 2019-01-08
8-K 2019-01-02
8-K 2018-11-06
8-K 2018-11-01
8-K 2018-10-31
8-K 2018-10-31
8-K 2018-10-09
8-K 2018-10-09
8-K 2018-08-01
8-K 2018-05-09
8-K 2018-04-26
8-K 2018-04-25
8-K 2018-04-13
8-K 2018-02-26
8-K 2018-02-13
8-K 2018-01-17

AMGP 10Q Quarterly Report

Part I - Financial Information
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Item 4. Controls and Procedures.
Part II - Other Information
Item 1. Legal Proceedings.
Item 1A. Risk Factors.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Item 6.Exhibits
EX-31.1 amgp-20200630ex311e12d51.htm
EX-31.2 amgp-20200630ex31292e08b.htm
EX-32.1 amgp-20200630ex321dc4b3c.htm
EX-32.2 amgp-20200630ex322e3b55d.htm
EX-99.1 amgp-20200630ex99196958c.htm

Antero Midstream GP Earnings 2020-06-30

Balance SheetIncome StatementCash Flow
10.08.06.04.02.00.02017201820192020
Assets, Equity
0.30.20.1-0.1-0.2-0.32016201720182020
Rev, G Profit, Net Income
0.20.10.0-0.0-0.1-0.22017201820192020
Ops, Inv, Fin

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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2020

OR

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: 001-38075

Graphic

ANTERO MIDSTREAM CORPORATION

(Exact name of registrant as specified in its charter)

Delaware

61-1748605

(State or other jurisdiction of
incorporation or organization)

(IRS Employer Identification No.)

1615 Wynkoop Street
Denver, Colorado

80202

(Address of principal executive offices)

(Zip Code)

(303357-7310

(Registrant’s telephone number, including area code)

Securities registered pursuant to section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.01

AM

New York Stock Exchange

Indicate by check mark whether the 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   No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).  Yes   No

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

Large Accelerated Filer

Accelerated Filer

Non-accelerated Filer

Smaller Reporting Company

Emerging Growth Company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

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

The registrant had 476,597,058 shares of common stock outstanding as of July 24, 2020.

Table of Contents

TABLE OF CONTENTS

1

Table of Contents

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Some of the information in this Quarterly Report on Form 10-Q may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of historical fact, included in this Quarterly Report on Form 10-Q, regarding our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. Words such as “may,” “assume,” “forecast,” “position,” “predict,” “strategy,” “expect,” “intend,” “plan,” “estimate,” “anticipate,” “believe,” “project,” “budget,” “potential,” or “continue,” and similar expressions are used to identify forward-looking statements, although not all forward-looking statements contain such identifying words. When considering these forward-looking statements, investors should keep in mind the risk factors and other cautionary statements in this Quarterly Report on Form 10-Q. These forward-looking statements are based on management’s current beliefs, based on currently available information, as to the outcome and timing of future events. Factors that could cause our actual results to differ materially from the results contemplated by such forward-looking statements include:

Antero Resources Corporation’s (“Antero Resources”) expected production and development plan;
impacts to producer customers of insufficient storage capacity;
our ability to execute our business strategy;
our ability to obtain debt or equity financing on satisfactory terms to fund additional acquisitions, expansion projects, working capital requirements and the repayment or refinancing of indebtedness;
our ability to realize the anticipated benefits of our investments in unconsolidated affiliates;
natural gas, natural gas liquids (“NGLs”), and oil prices;
impacts of world health events, including the coronavirus (COVID-19) pandemic;
our ability to complete the construction of or purchase new gathering and compression, processing, water handling or other assets on schedule, at the budgeted cost or at all, and the ability of such assets to operate as designed or at expected levels;
our ability to execute our share repurchase program;
competition and government regulations;
actions taken by third-party producers, operators, processors and transporters;
pending legal or environmental matters;
costs of conducting our operations;
general economic conditions;
credit markets;
operating hazards, natural disasters, weather-related delays, casualty losses and other matters beyond our control;
uncertainty regarding our future operating results; and
our other plans, objectives, expectations and intentions contained in this Quarterly Report on Form 10-Q.

We caution investors that these forward-looking statements are subject to all of the risks and uncertainties incidental to our business, most of which are difficult to predict and many of which are beyond our control. These risks include, but are not limited to, commodity price volatility, inflation, environmental risks, Antero Resources’ drilling and completion and other operating risks,

2

Table of Contents

regulatory changes, the uncertainty inherent in projecting Antero Resources’ future rates of production, cash flows and access to capital, the timing of development expenditures, impacts of world health events, including the COVID-19 pandemic, potential shut-ins of production by producers due to lack of downstream demand or storage capacity, and the other risks described or referenced under the heading “Risk Factors” herein, including the risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2019 (the “2019 Form 10-K”) and in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, each of which is on file with the Securities and Exchange Commission (“SEC”).

Should one or more of the risks or uncertainties described or referenced in this Quarterly Report on Form 10-Q occur, or should underlying assumptions prove incorrect, our actual results and plans could differ materially from those expressed in any forward-looking statements.

All forward-looking statements, expressed or implied, included in this Quarterly Report on Form 10-Q are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue.

Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q.

3

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PART I—FINANCIAL INFORMATION

ANTERO MIDSTREAM CORPORATION

Condensed Consolidated Balance Sheets

December 31, 2019 and June 30, 2020

(In thousands)

(Unaudited)

December 31,

June 30,

    

2019

   

2020

 

Assets

Cash and cash equivalents

$

1,235

2,997

Accounts receivable–Antero Resources

101,029

76,088

Accounts receivable–third party

4,574

3,392

Income tax receivable

17,547

Other current assets

1,720

645

Total current assets

108,558

100,669

Property and equipment, net

3,273,410

3,249,643

Investments in unconsolidated affiliates

709,639

729,823

Deferred tax asset

103,231

160,579

Customer relationships

1,498,119

1,462,908

Goodwill

575,461

Other assets, net

14,460

11,433

Total assets

$

6,282,878

5,715,055

Liabilities and Stockholders' Equity

Current liabilities:

Accounts payable–Antero Resources

$

3,146

2,714

Accounts payable–third party

6,645

19,822

Accrued liabilities

104,188

72,284

Contingent acquisition consideration

125,000

Other current liabilities

3,105

3,325

Total current liabilities

242,084

98,145

Long-term liabilities:

Long-term debt

2,892,249

3,088,785

Other

5,131

4,943

Total liabilities

3,139,464

3,191,873

Stockholders' Equity:

Preferred stock, $0.01 par value: 100,000 authorized at December 31, 2019 and June 30, 2020, respectively

Series A non-voting perpetual preferred stock; 12 designated and 10 issued and outstanding at both December 31, 2019 and June 30, 2020

Common stock, $0.01 par value; 2,000,000 authorized; 484,042 and 476,486 issued and outstanding at December 31, 2019 and June 30, 2020, respectively

4,840

4,765

Additional paid-in capital

3,480,139

3,164,474

Accumulated loss

(341,565)

(646,057)

Total stockholders' equity

3,143,414

2,523,182

Total liabilities and stockholders' equity

$

6,282,878

5,715,055

See accompanying notes to unaudited condensed consolidated financial statements.

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ANTERO MIDSTREAM CORPORATION

Condensed Consolidated Statements of Operations and Comprehensive Income

Three Months Ended June 30, 2019 and 2020

(Unaudited)

(In thousands, except per share amounts)

Three Months Ended June 30,

    

2019

    

2020

Revenue:

    

    

Gathering and compression–Antero Resources

$

168,925

173,991

Water handling–Antero Resources

95,181

63,351

Water handling and treatment–third party

46

Amortization of customer relationships

(8,534)

(17,606)

Total revenue

255,618

219,736

Operating expenses:

Direct operating

63,998

42,067

General and administrative (including $21,543 and $2,697 of equity-based compensation in 2019 and 2020, respectively)

34,622

12,422

Facility idling

2,475

Impairment of property and equipment

594

Depreciation

36,447

27,745

Accretion and change in fair value of contingent acquisition consideration

2,297

Accretion of asset retirement obligations

69

61

Loss on asset sale

240

Total operating expenses

138,027

85,010

Operating income

117,591

134,726

Interest expense, net

(31,521)

(35,311)

Equity in earnings of unconsolidated affiliates

13,623

20,947

Income before income taxes

99,693

120,362

Provision for income tax expense

(30,419)

(31,921)

Net income and comprehensive income

$

69,274

88,441

Net income per share–basic

$

0.14

0.19

Net income per share–diluted

$

0.14

0.18

Weighted average common shares outstanding:

Basic

506,816

476,836

Diluted

507,767

478,837

See accompanying notes to unaudited condensed consolidated financial statements.

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ANTERO MIDSTREAM CORPORATION

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

Six Months Ended June 30, 2019 and 2020

(Unaudited)

(In thousands, except per share amounts)

Six Months Ended June 30,

    

2019

    

2020

Revenue:

    

    

Gathering and compression–Antero Resources

$

202,459

337,120

Water handling–Antero Resources

117,532

161,535

Water handling–third party

50

Amortization of customer relationships

(10,315)

(35,211)

Total revenue

309,726

463,444

Operating expenses:

Direct operating

78,980

90,795

General and administrative (including $32,966 and $6,035 of equity-based compensation in 2019 and 2020, respectively)

54,431

25,959

Facility idling

11,153

Impairment of goodwill

575,461

Impairment of property and equipment

594

89,083

Depreciation

44,097

55,088

Accretion and change in fair value of contingent acquisition consideration

3,346

Accretion of asset retirement obligations

79

103

Loss on asset sale

240

Total operating expenses

181,527

847,882

Operating income (loss)

128,199

(384,438)

Interest expense, net

(37,738)

(72,942)

Equity in earnings of unconsolidated affiliates

16,503

40,024

Income (loss) before income taxes

106,964

(417,356)

Provision for income tax benefit (expense)

(28,042)

112,864

Net income (loss) and comprehensive income (loss)

$

78,922

(304,492)

Net income (loss) per share–basic and diluted

$

0.21

(0.63)

Weighted average common shares outstanding:

Basic

381,045

479,969

Diluted

382,026

479,969

See accompanying notes to unaudited condensed consolidated financial statements.

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ANTERO MIDSTREAM CORPORATION

Condensed Consolidated Statement of Partners’ Capital and Stockholders’ Equity

Six Months Ended June 30, 2019

(Unaudited)

(In thousands)

Common

Shares

Representing

Limited

Additional

Partner

Series B

Preferred

Common Stock

Paid-In

Accumulated

Total

Interests

Unitholders

Stock

Shares

Amount

Capital

Earnings

Equity

Balance at December 31, 2018

    

$

(41,969)

    

72,830

    

    

    

$

    

    

    

30,861

Distributions to unitholders

(30,543)

(3,720)

(34,263)

Net (loss) and comprehensive (loss) pre-acquisition

(13,549)

(13,549)

Equity-based compensation pre-acquisition

7,034

7,034

Exchange of common shares for shares of common stock and cash consideration paid

79,027

(69,110)

506,641

5,066

4,002,898

4,017,881

Issuance of Series A non-voting perpetual preferred stock

Equity-based compensation post-acquisition

4,389

4,389

Net income and comprehensive income post-acquisition

23,197

23,197

Balance at March 31, 2019

506,641

5,066

4,007,287

23,197

4,035,550

Dividends to shareholders

(152,180)

(152,180)

Equity-based compensation

21,543

21,543

Issuance of common stock upon vesting of equity-based compensation awards, net of common stock withheld for income taxes

206

2

(1,830)

(1,828)

Net income and comprehensive income

69,274

69,274

Balance at June 30, 2019

$

506,847

$

5,068

3,874,820

92,471

3,972,359

See accompanying notes to unaudited condensed consolidated financial statements.

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ANTERO MIDSTREAM CORPORATION

Condensed Consolidated Statement of Stockholders’ Equity

Six Months Ended June 30, 2020

(Unaudited)

(In thousands)

Additional

Accumulated

Preferred

Common Stock

Paid-In

Income

Total

Stock

Shares

Amount

Capital

(Loss)

Equity

Balance at December 31, 2019

    

$

    

484,042

    

$

4,840

    

3,480,139

    

(341,565)

    

3,143,414

Dividends to stockholders

(149,014)

(149,014)

Equity-based compensation

3,338

3,338

Issuance of common stock upon vesting of equity-based compensation awards, net of common stock withheld for income taxes

43

(26)

(26)

Repurchases and retirement of common stock

(4,700)

(46)

(15,778)

(15,824)

Net (loss) and comprehensive (loss)

(392,933)

(392,933)

Balance at March 31, 2020

$

479,385

$

4,794

3,318,659

(734,498)

2,588,955

Dividends to stockholders

(147,656)

(147,656)

Equity-based compensation

2,697

2,697

Issuance of common stock upon vesting of equity-based compensation awards, net of common stock withheld for income taxes

311

4

(370)

(366)

Repurchases and retirement of common stock

(3,210)

(33)

(8,856)

(8,889)

Net income and comprehensive income

88,441

88,441

Balance at June 30, 2020

$

476,486

$

4,765

3,164,474

(646,057)

2,523,182

See accompanying notes to unaudited condensed consolidated financial statements.

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ANTERO MIDSTREAM CORPORATION

Condensed Consolidated Statements of Cash Flows

Six Months Ended June 30, 2019 and 2020

(Unaudited)

(In thousands)

Six Months Ended June 30,

    

2019

    

2020

 

Cash flows provided by (used in) operating activities:

    

    

  

Net income (loss)

$

78,922

(304,492)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Distributions from Antero Midstream Partners LP, prior to the Transactions

43,492

Depreciation

44,097

55,088

Payment of contingent consideration in excess of acquisition date fair value

(34,342)

Accretion and change in fair value of contingent acquisition consideration

3,425

103

Impairment

594

664,544

Deferred income taxes

28,042

(56,408)

Equity-based compensation

32,966

6,035

Equity in earnings of unconsolidated affiliates

(16,503)

(40,024)

Distributions from unconsolidated affiliates

23,860

41,828

Amortization of customer relationships

10,315

35,211

Amortization of deferred financing costs

1,102

2,190

Settlement of asset retirement obligations

(601)

Loss on asset sale

240

Changes in assets and liabilities:

Accounts receivable–Antero Resources

38,414

24,941

Accounts receivable–third party

9

1,089

Income tax receivable

(17,547)

Other current assets

(1,867)

930

Accounts payable–Antero Resources

973

(432)

Accounts payable–third party

(4,629)

5,495

Income taxes payable

(15,370)

Accrued liabilities

(15,678)

(21,701)

Net cash provided by operating activities

252,164

362,147

Cash flows provided by (used in) investing activities:

Additions to gathering systems and facilities

(89,206)

(103,937)

Additions to water handling systems

(51,984)

(19,477)

Investments in unconsolidated affiliates

(103,409)

(21,988)

Cash received on acquisition of Antero Midstream Partners LP

619,532

Cash consideration paid to Antero Midstream Partners LP unitholders

(598,709)

Cash received in asset sale

123

Change in other assets

2,375

1,938

Net cash used in investing activities

(221,401)

(143,341)

Cash flows provided by (used in) financing activities:

Distributions to unitholders and dividends to stockholders

(182,625)

(296,395)

Distributions to Series B unitholders

(3,720)

Distributions to preferred stockholders

(98)

(275)

Repurchases of common stock

(24,713)

Issuance of senior notes

650,000

Payments of deferred financing costs

(6,952)

Borrowings (repayments) on bank credit facilities, net

(480,500)

195,500

Payment for contingent acquisition consideration

(90,658)

Employee tax withholding for settlement of equity compensation awards

(1,828)

(392)

Other

(71)

(111)

Net cash used in financing activities

(25,794)

(217,044)

Net increase in cash and cash equivalents

4,969

1,762

Cash and cash equivalents, beginning of period

2,822

1,235

Cash and cash equivalents, end of period

$

7,791

2,997

Supplemental disclosure of cash flow information:

Cash paid during the period for interest

$

31,147

74,665

Cash refund received (paid) during the period for income taxes

$

(16,001)

38,910

Increase (decrease) in accrued capital expenditures and accounts payable for property and equipment

$

9,447

(3,461)

See accompanying notes to unaudited condensed consolidated financial statements.

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ANTERO MIDSTREAM CORPORATION

Notes to Unaudited Condensed Consolidated Financial Statements

December 31, 2019 and June 30, 2020

(1) Organization

Antero Midstream Corporation was originally formed as Antero Resources Midstream Management LLC in 2013 to become the general partner of Antero Midstream Partners LP (“Antero Midstream Partners”).  On May 4, 2017, Antero Resources Midstream Management LLC converted from a limited liability company to a limited partnership under the laws of the State of Delaware and changed its name to Antero Midstream GP LP (“AMGP”) in connection with its initial public offering.  On March 12, 2019, pursuant to the Simplification Agreement, dated as of October 9, 2018, by and among AMGP, Antero Midstream Partners and certain of their affiliates (the “Simplification Agreement”), (i) AMGP was converted from a limited partnership to a corporation under the laws of the State of Delaware and changed its name to Antero Midstream Corporation (the “Conversion”), (ii) an indirect, wholly owned subsidiary of Antero Midstream Corporation was merged with and into Antero Midstream Partners, with Antero Midstream Partners surviving the merger as an indirect, wholly owned subsidiary of Antero Midstream Corporation (the “Merger”), and (iii) Antero Midstream Corporation exchanged (the “Series B Exchange” and, together with the Conversion, the Merger and the other transactions pursuant to by the Simplification Agreement, the “Transactions”) each issued and outstanding Series B Unit (the “Series B Units”) representing a membership interest in Antero IDR Holdings LLC (“IDR Holdings”) for 176.0041 shares of its common stock, par value $0.01 per share (“AM common stock”). As a result of the Transactions, Antero Midstream Partners became and is now a wholly owned subsidiary of Antero Midstream Corporation and former shareholders of AMGP, unitholders of Antero Midstream Partners, including Antero Resources Corporation (“Antero Resources”), and holders of Series B Units became owners of AM common stock. Unless the context otherwise requires, references to the “Company,” “we,” “us” or “our” refer to (i) for the period prior to March 13, 2019, AMGP and its consolidated subsidiaries, which did not include Antero Midstream Partners and its subsidiaries, and (ii) for the period beginning on March 13, 2019, Antero Midstream Corporation and its consolidated subsidiaries, including Antero Midstream Partners and its subsidiaries, including Antero Midstream LLC, Antero Water LLC (“Antero Water”), Antero Treatment LLC, and Antero Midstream Finance Corporation (“Finance Corp”).

We are a growth-oriented midstream company formed to own, operate and develop midstream energy infrastructure primarily to service Antero Resources and its production and completion activity in the Appalachian Basin’s Marcellus Shale and Utica Shale located in West Virginia and Ohio. Our assets consist of gathering pipelines, compressor stations, interests in processing and fractionation plants, and water handling assets. The Company, through Antero Midstream Partners and its affiliates, provides midstream services to Antero Resources under long-term contracts. The Company’s corporate headquarters are located in Denver, Colorado.

(2) Summary of Significant Accounting Policies

(a)

Basis of Presentation

These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) applicable to interim financial information and should be read in the context of the Company’s December 31, 2019 consolidated financial statements and notes thereto for a more complete understanding of the Company’s operations, financial position, and accounting policies. The Company’s December 31, 2019 consolidated financial statements were included in the Company’s 2019 Annual Report on Form 10-K, which was filed with the SEC.

These unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information, and, accordingly, do not include all of the information and footnotes required by GAAP for complete consolidated financial statements. In the opinion of management, these unaudited condensed consolidated financial statements include all adjustments (consisting of normal and recurring accruals) considered necessary to present fairly the Company’s financial position as of December 31, 2019 and June 30, 2020, the results of the Company’s operations for the three and six months ended June 30, 2019 and 2020, and its cash flows for the six months ended June 30, 2019 and 2020. The Company has no items of other comprehensive income (loss); therefore, net income (loss) is equal to comprehensive income (loss).

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ANTERO MIDSTREAM CORPORATION

Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)

December 31, 2019 and June 30, 2020

Certain costs of doing business incurred and charged to the Company by Antero Resources have been reflected in the accompanying unaudited condensed consolidated financial statements. These costs include general and administrative expenses provided to the Company by Antero Resources in exchange for:

business services, such as payroll, accounts payable and facilities management;
corporate services, such as finance and accounting, legal, human resources, investor relations and public and regulatory policy; and
employee compensation, including equity-based compensation.

Transactions between the Company and Antero Resources have been identified in the unaudited condensed consolidated financial statements (see Note 6—Transactions with Affiliates).

(b)

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements include (i) for the period prior to March 13, 2019, the accounts of AMGP and its consolidated subsidiaries, which did not include Antero Midstream Partners and its subsidiaries, and (ii) for the period beginning on March 13, 2019, the accounts of Antero Midstream Corporation and its consolidated subsidiaries, including Antero Midstream Partners and its subsidiaries, which were acquired in the Transactions. See Note 3—Business Combination. All significant intercompany accounts and transactions have been eliminated in the Company’s unaudited condensed consolidated financial statements.

(c)

Revenue Recognition

The Company, through Antero Midstream Partners and its affiliates, provides gathering, compression and water handling services under fee-based contracts primarily based on throughput or at cost plus a margin. Certain of these contracts contain operating leases of the Company’s assets under GAAP. Under these arrangements, the Company receives fees for gathering, compression services and water handling services. The revenue the Company earns from these arrangements is directly related to (i) in the case of natural gas gathering and compression, the volumes of metered natural gas that it gathers, compresses and delivers to natural gas compression sites or other transmission delivery points, (ii) in the case of fresh water services, the quantities of fresh water delivered to its customers for use in their well completion operations, (iii) in the case of wastewater treatment services performed by the Company prior to idling of the Clearwater Facility (as defined below) in September 2019, the quantities of wastewater treated for its customers, (iv) in the case of wastewater services provided by third parties, the third-party costs the Company incurs plus 3%, or (v) in the case of flowback and produced water treatment performed by the Company, a cost of service fee based on the costs incurred by the Company. The Company recognizes revenue when it satisfies a performance obligation by delivering a ser