Enterprise Products Partners L.P.

SEC Filings

10-Q
GULFTERRA ENERGY PARTNERS L P filed this Form 10-Q on 08/09/2004
Entire Document
 
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     Operating revenues and expenses by segment include intersegment revenues
and expenses which are eliminated in consolidation. For a further discussion of
the individual segments, see Item 1., Financial Statements, Note 11. For the
past two years, inflation has not had a material effect on any of our financial
results.
 
SEGMENT RESULTS
 
     We use performance cash flows (which we formerly referred to as EBITDA) to
evaluate the performance of our segments, determine how resources will be
allocated and develop strategic plans. We define performance cash flows as
earnings before interest, depreciation and amortization and other adjustments.
Historically our lenders and equity investors have viewed our performance cash
flows measure as an indication of our ability to generate sufficient cash to
meet debt obligations or to pay distributions. We believe that there has been a
shift in investors' evaluation regarding investments in MLPs and they now put as
much focus on the performance of an MLP investment as they do its ability to pay
distributions. For that reason, we disclose performance cash flows as a measure
of our segment performance.
 
     We believe performance cash flows is also useful to our investors because
it allows them to evaluate the effectiveness of our business segments from an
operational perspective, exclusive of the costs to finance those activities and
depreciation and amortization, neither of which are directly relevant to the
efficiency of those operations. This measurement may not be comparable to
measurements used by other companies and should not be used as a substitute for
net income or other performance measures.
 
     A reconciliation of our segment performance cash flows to our net income is
as follows:
 

<Table>
<Caption>
                                                        QUARTER ENDED       SIX MONTHS ENDED
                                                          JUNE 30,              JUNE 30,
                                                     -------------------   -------------------
                                                       2004       2003       2004       2003
                                                     --------   --------   --------   --------
                                                                  (IN THOUSANDS)
<S>                                                  <C>        <C>        <C>        <C>
Natural gas pipelines and plants...................  $ 83,904   $ 78,386   $165,917   $156,221
Oil and NGL logistics..............................    13,252     12,897     20,720     24,497
Natural gas storage................................     7,721      8,068     16,782     15,069
Platform services..................................     5,816      6,277     12,179     10,512
                                                     --------   --------   --------   --------
  Segment performance cash flows...................   110,693    105,628    215,598    206,299
Plus: Other, nonsegment results....................     3,287      3,011      8,692      8,277
      Earnings from unconsolidated affiliates......     3,258      2,987      5,466      6,303
      Cumulative effect of accounting change.......        --         --         --      1,690
Less: Interest and debt expense....................    26,696     31,838     54,727     66,324
      Loss due to early redemptions of debt........    16,285         --     16,285      3,762
      Depreciation, depletion and amortization.....    26,080     24,846     52,303     48,543
      Cash distributions from unconsolidated
       affiliates..................................       700      3,520      1,450      8,230
      Minority interest............................        --         47        (12)        80
      Net cash payment received from El Paso
       Corporation.................................        --      2,078      1,960      4,118
                                                     --------   --------   --------   --------
Net income.........................................  $ 47,477   $ 49,297   $103,043   $ 91,512
                                                     ========   ========   ========   ========
</Table>

 
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