Southcross Energy Partners, L.P. Announces Preliminary Results for Fourth Quarter 2015; Provides Update on Southcross Holdings LP

DALLAS, Texas, March 22, 2016 -- Southcross Energy Partners, L.P. (NYSE:SXE) (“Southcross”) today announced preliminary results for the fourth quarter of 2015 and provided an update on Southcross Holdings LP (“Holdings”). Holdings, a privately held entity, owns 100% of Southcross Energy Partners GP, LLC, the general partner of Southcross, as well as a portion of Southcross’ outstanding equity.

Preliminary Results for the Fourth Quarter of 2015 and Operations Update

During the fourth quarter of 2015, Southcross’ processed gas volumes and production of natural gas liquids (“NGLs”) were in line with its previously communicated outlook.  Processed gas volumes during the quarter averaged approximately 437 MMcf/d, consistent with third quarter 2015 volumes of approximately 441 MMcf/d.  The volume of NGLs produced during the quarter increased by approximately 6% over third quarter 2015 volumes to approximately 46,000 Bbls/d.  Southcross expects to report fourth quarter 2015 Adjusted EBITDA at the upper end of the previously provided guidance range of $23 million to $25 million. 

Update on Southcross Holdings LP

Holdings announced today that it has entered into a Restructuring Support Agreement with its owners, a majority of its senior lenders and all of the Class B preferred equity holders and, as part of this agreement, commenced a solicitation of votes for a prepackaged plan of reorganization (the “POR”). Holdings intends to commence cases under chapter 11 of the United States Bankruptcy Code to implement the POR, which is expected to result in a significant reduction in outstanding debt along with a new equity investment from certain of its existing equity holders.

Holdings’ POR also includes repayment of all past due obligations due to Southcross and current payment of such obligations going forward.  In addition, Holdings has agreed, subject to bankruptcy court approval, to commit up to $50 million to fund any potential equity cure requirements of Southcross through fiscal year 2016. Both the repayment and the equity cure contributions are expected to be funded from the proceeds of the equity investment contemplated under, and upon the effectiveness of, the POR. 

Southcross and its subsidiaries are not included in these actions, will not be a party to the Chapter 11 cases and will continue to operate as usual.  Southcross’ customers will continue to receive the highest levels of service and reliability and its vendors will continue to be paid in the ordinary course. 

Delay in Filing of Annual Report on Form 10-K and Associated Fourth Quarter Earnings Release

On March 16, 2016, Southcross filed a Form 12b-25, Notification of Late Filing, with the Securities and Exchange Commission with respect to its Form 10-K for the year ended December 31, 2015. Southcross expects that the POR outlined above will address any financial covenant default and liquidity shortfall concerns that could give rise to a going concern audit qualification.  As a result, Southcross plans to file its Form 10-K and associated fourth quarter 2015 results once potential issues related to a going concern audit opinion have been resolved through the POR.   

Forward-Looking Statements

This press release includes certain statements concerning expectations for the future that are forward-looking within the meaning of the federal securities laws. Forward-looking statements include, without limitation, any statement that may project, indicate or imply future results, events, performance or achievements, and may contain the words “expect,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “will be,” “will continue,” “will likely result,” and similar expressions, or future conditional verbs such as “may,” “will,” “should,” “would” and “could.” Forward-looking statements in this press release include statements regarding fourth quarter 2015 operating results, Holdings’ Chapter 11 bankruptcy filing, Holdings’ equity cure commitments to Southcross and the filing of Southcross’ Form 10-K. Although Southcross believes the expectations and forecasts reflected in these and other forward-looking statements are reasonable, Southcross can give no assurance they will prove to be correct. Forward-looking statements contain known and unknown risks and uncertainties (many of which are difficult to predict and beyond management’s control) that may cause Southcross’ actual results in future periods to differ materially from anticipated or projected results. An extensive list of specific material risks and uncertainties affecting Southcross is contained in its Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 5, 2014 and in other documents and reports filed from time to time with the SEC. Any forward-looking statements in this press release are made as of the date hereof and Southcross undertakes no obligation to update or revise any forward-looking statements to reflect new information or events.

About Southcross Energy Partners, L.P.
Southcross Energy Partners, L.P. is a master limited partnership that provides natural gas gathering, processing, treating, compression and transportation services and NGL fractionation and transportation services. It also sources, purchases, transports and sells natural gas and NGLs. Its assets are located in South Texas, Mississippi and Alabama and include four gas processing plants, two fractionation plants and approximately 3,100 miles of pipeline. The South Texas assets are located in or near the Eagle Ford shale region. Southcross is headquartered in Dallas, Texas. Visit www.southcrossenergy.com for more information.

About Southcross Holdings LP
Southcross Holdings LP owns 100% of Southcross Energy Partners GP, LLC, the general partner of Southcross, as well as a portion of Southcross’ common units, all of Southcross’ subordinated units and all of Southcross’ Class B convertible units. Holdings also owns natural gas gathering and treating assets as well as NGL pipelines and fractionation facilities in South Texas.

Epiq Strategic Communications for Southcross Holdings LP
Jennifer E. Mercer
310-712-6215
[email protected]

Southcross Energy Partners, L.P.
David Lawrence, 214-979-3720
Investor Relations
[email protected]