Correspondence 0001104659-23-039868 from EnLink Midstream, LLC (ENLC) (CIK 0001592000)
EnLink Midstream, LLC (ENLC) (CIK 0001592000)
Date: March 31, 2023 · CIK: 0001592000 · Accession: 0001104659-23-039868
AI Filing Summary & Sentiment
File numbers found in text: 001-36336
Referenced dates: March 17, 2023
Letter
March 31,
Via EDGAR
United States Securities and Exchange Commission
Division of Corporation Finance
100 F Street, NE
Washington, D.C.
Attention:
Robert Babula, Staff Accountant
Gus Rodriguez, Staff Accountant
Re:
EnLink Midstream, LLC
Form 10-K for the Fiscal Year Ended December 31, 2022
Filed February 15, 2023
File No. 001-36336
To the addressees set forth above:
This letter sets forth the responses of EnLink Midstream, LLC (the “Registrant,” “we” and “our”) to the comments provided by the staff of the Division of Corporation Finance (the “Staff”) of the Securities and Exchange Commission (the “Commission”) in its comment letter dated March 17, 2023 (the “Comment Letter”) with respect to the above-referenced filing with the Commission.
For your convenience, we have repeated each comment of the Staff in bold face type exactly as given in the Comment Letter and set forth below such comment is the Registrant’s response.
Form 10-K for the Fiscal Year ended December 31, 2022
Management’s Discussion and Analysis of Financial Condition and Results of Operations, page 73
General
1. We note your discussion and analysis begins with a tabulation of activity having gross margin on a segment and consolidated basis as the first line item, without showing the composition of the measure, excluding revenues, cost of sales, and other material items, although you identify depreciation and amortization as a reconciling item in arriving at your non-GAAP measure of segment profit, and operating expenses as a reconciling item in arriving at your non-GAAP measure of adjusted gross margin.
U.S. Securities and Exchange
Commission
Page 2
March 31, 2023
We also note that content following your tabulation includes no discussion and analysis of revenues or cost of revenues, on either a segment or consolidated basis, and no discussion and analysis of operating expenses or depreciation and amortization on a consolidated basis. However, in your Statements of Operations on page 92, you report revenues from product sales and midstream services, and in Note 16 on pages 135-137, you report revenues from natural gas sales, NGL sales, crude oil and condensate sales, gathering and transportation, processing, NGL services, crude services, and other services.
The guidance in Item 303(a) and (b)(2) of Regulation S-K requires a discussion and analysis of the consolidated financial statements, including (i) significant components of revenues and expenses that would be material to an understanding of the results of operations; (ii) known trends or uncertainties that have had or that are reasonably likely to have a material favorable or unfavorable impact on revenues; (iii) events that are reasonably likely to cause a material change in the relationship between costs and revenues; and (iv) the extent to which material changes in revenues are attributable to changes in prices or to changes in the volume or amount of goods or services being sold.
Please expand your discussion and analysis to address revenues and cost of sales on a consolidated and segment basis, including details that are responsive to the requirements referenced above, and consistent with the activity reported in your financial statements. Given your disclosure on page 81, stating that certain of your revenue generating contracts contain clauses that increase your fees based on changes in inflation metrics, also quantify the extent to which such inflation metrics have changed and impacted revenues.
In response to the Commission’s comment, the Registrant will revise our disclosure in future filings, beginning with our Quarterly Report on Form 10-Q for the quarter ended March 31, 2023, as requested, including to (1) revise the tabular presentation at the beginning of Results of Operations to include total revenues, cost of sales and other material items; (2) expand the associated narrative to discuss operating expenses and depreciation and amortization on a consolidated basis; and (3) expand the associated narratives to address revenues and cost of sales on both a consolidated and segment basis, including providing details that are responsive to the requirements referenced by the Commission in its comment and consistent with activity reported in our financial statements. In addition, we will also address the extent to which inflation metrics have changed and impacted revenues.
Operating Expenses, page 74
2. We note that you identify several reasons for changes in your operating expenses in the various segment oriented disclosures, though do not separately quantify the impact of each driver or component, e.g. changes attributed to materials and supplies expense, construction fees and services, utility costs, and labor and benefits costs.
Under Item 303(b) of Regulation S-K, when the consolidated financial statements reflect material changes from period-to-period in one or more line items, or where material changes within a line item offset one another, you are required to describe the underlying reasons in quantitative and qualitative terms.
U.S. Securities and Exchange
Commission
Page 3
March 31, 2023
Please revise to quantify the impact of each factor or component associated with material changes, including the impact of inflation associated with any material changes.
In response to the Commission’s comment, the Registrant will revise our disclosure in future filings, beginning with our Quarterly Report on Form 10-Q for the quarter ended March 31, 2023, as requested, to quantify the impact of each factor or component associated with material changes in operating expenses for each segment, including the impact of inflation associated with any material changes.
* * *
If you have any questions with respect to the foregoing responses or require further information, please contact the undersigned at (214) 721-9250 or Preston Bernhisel of Baker Botts L.L.P. at (214) 953-6783.
Very truly yours,
/s/ Sarah M. Rechter
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CORRESP
1
filename1.htm
March 31,
2023
Via EDGAR
United States
Securities and Exchange Commission
Division of Corporation
Finance
100 F Street,
NE
Washington, D.C.
20549
Attention:
Robert Babula, Staff Accountant
Gus Rodriguez, Staff Accountant
Re:
EnLink Midstream, LLC
Form 10-K for the Fiscal Year Ended December 31, 2022
Filed February 15, 2023
File No. 001-36336
To the addressees
set forth above:
This letter sets forth the responses of EnLink
Midstream, LLC (the “Registrant,” “we” and “our”) to the comments provided by the staff of the Division
of Corporation Finance (the “Staff”) of the Securities and Exchange Commission (the “Commission”) in its comment
letter dated March 17, 2023 (the “Comment Letter”) with respect to the above-referenced filing with the Commission.
For your convenience, we have repeated each comment
of the Staff in bold face type exactly as given in the Comment Letter and set forth below such comment is the Registrant’s response.
Form 10-K for the Fiscal Year ended December 31, 2022
Management’s Discussion and Analysis of Financial Condition
and Results of Operations, page 73
General
1. We
note your discussion and analysis begins with a tabulation of activity having gross margin on a segment and consolidated basis as the
first line item, without showing the composition of the measure, excluding revenues, cost of sales, and other material items, although
you identify depreciation and amortization as a reconciling item in arriving at your non-GAAP measure of segment profit, and operating
expenses as a reconciling item in arriving at your non-GAAP measure of adjusted gross margin.
U.S. Securities and Exchange
Commission
Page 2
March 31, 2023
We also note that content following your tabulation includes
no discussion and analysis of revenues or cost of revenues, on either a segment or consolidated basis, and no discussion and analysis
of operating expenses or depreciation and amortization on a consolidated basis. However, in your Statements of Operations on page 92,
you report revenues from product sales and midstream services, and in Note 16 on pages 135-137, you report revenues from natural
gas sales, NGL sales, crude oil and condensate sales, gathering and transportation, processing, NGL services, crude services, and other
services.
The guidance in Item 303(a) and (b)(2) of Regulation
S-K requires a discussion and analysis of the consolidated financial statements, including (i) significant components of revenues
and expenses that would be material to an understanding of the results of operations; (ii) known trends or uncertainties that have
had or that are reasonably likely to have a material favorable or unfavorable impact on revenues; (iii) events that are reasonably
likely to cause a material change in the relationship between costs and revenues; and (iv) the extent to which material changes in
revenues are attributable to changes in prices or to changes in the volume or amount of goods or services being sold.
Please expand your discussion and analysis to address
revenues and cost of sales on a consolidated and segment basis, including details that are responsive to the requirements referenced above,
and consistent with the activity reported in your financial statements. Given your disclosure on page 81, stating that certain of
your revenue generating contracts contain clauses that increase your fees based on changes in inflation metrics, also quantify the extent
to which such inflation metrics have changed and impacted revenues.
In response to the Commission’s comment, the Registrant
will revise our disclosure in future filings, beginning with our Quarterly Report on Form 10-Q for the quarter ended March 31,
2023, as requested, including to (1) revise the tabular presentation at the beginning of Results of Operations to include total revenues,
cost of sales and other material items; (2) expand the associated narrative to discuss operating expenses and depreciation and amortization
on a consolidated basis; and (3) expand the associated narratives to address revenues and cost of sales on both a consolidated and
segment basis, including providing details that are responsive to the requirements referenced by the Commission in its comment and consistent
with activity reported in our financial statements. In addition, we will also address the extent to which inflation metrics have changed
and impacted revenues.
Operating Expenses, page 74
2. We
note that you identify several reasons for changes in your operating expenses in the various segment oriented disclosures, though do
not separately quantify the impact of each driver or component, e.g. changes attributed to materials and supplies expense, construction
fees and services, utility costs, and labor and benefits costs.
Under Item 303(b) of Regulation S-K, when the consolidated
financial statements reflect material changes from period-to-period in one or more line items, or where material changes within a line
item offset one another, you are required to describe the underlying reasons in quantitative and qualitative terms.
U.S. Securities and Exchange
Commission
Page 3
March 31, 2023
Please revise to quantify the impact of each factor or
component associated with material changes, including the impact of inflation associated with any material changes.
In response to the Commission’s comment, the Registrant
will revise our disclosure in future filings, beginning with our Quarterly Report on Form 10-Q for the quarter ended March 31,
2023, as requested, to quantify the impact of each factor or component associated with material changes in operating expenses for each
segment, including the impact of inflation associated with any material changes.
* * *
If you have any questions with respect to the foregoing
responses or require further information, please contact the undersigned at (214) 721-9250 or Preston Bernhisel of Baker Botts L.L.P.
at (214) 953-6783.
Very truly yours,
/s/ Sarah M. Rechter
Sarah M. Rechter
Deputy General Counsel
cc:
Jesse Arenivas
Benjamin D. Lamb
Alaina K. Brooks
J. Philipp Rossbach
EnLink Midstream, LLC
Preston Bernhisel, Baker Botts L.L.P.