Enterprise Products Partners L.P.

SEC Filings

S-1/A
ENTERPRISE PRODUCTS PARTNERS L P filed this Form S-1/A on 07/21/1998
Entire Document
 
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  Propylene Fractionation.  The Company's operating margin for propylene
fractionation increased by 4.0% to $19.0 million in 1997 from $18.3 million in
1996. Propylene fractionation operating margins were positively affected by an
increase in volumes due to the start up of the Company's second propylene
fractionation unit in April 1997. This increase in volume was largely offset
by price decreases for high purity propylene in the fourth quarter of 1997,
which reflected weaker prices for polypropylene, compared to price increases
for high purity propylene in late 1996. As described above, the Company uses
an average cost method of accounting for its refinery-sourced
propane/propylene mix feedstock costs. Accordingly, the Company's feedstock
costs generally increase or decrease at a slower rate than high purity
propylene market prices.
 
  Pipeline. The Company's operating margin for pipeline operations increased
by 20.0% to $13.5 million in 1997 from $11.3 million in 1996, reflecting an
11.5% increase in throughput volume.
 
 Selling, General and Administrative Expenses
 
  Selling, general and administrative expenses decreased by $1.1 million to
$23.1 million in 1997 from $24.2 million in 1996. This decrease was primarily
due to the recognition of compensation expense in 1996 related to employee
SARs. SAR expense declined to $1.1 million in 1997 compared to $2.1 million in
1996. EPCO will retain liability for all outstanding SARs following completion
of this offering.
 
 Interest Expense
 
  Interest expense was $25.7 million in 1997 and $26.3 million in 1996. The
$0.6 million decrease was due to a decrease in the average debt outstanding to
$243.8 million in 1997 from $268.4 million in 1996.
 
 Equity Income of Unconsolidated Affiliates
 
  Equity income of unconsolidated affiliates includes amounts from BEF and
Mont Belvieu Associates. Earnings attributable to BEF were $9.3 million in
1997 and $9.8 million in 1996. Earnings attributable to Mont Belvieu
Associates were $6.4 million in 1997 and $6.0 million in 1996, reflecting
increased NGL fractionation volumes in the second half of 1997.
 
YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31, 1995
 
 Revenues; Costs and Expenses
   
  The Company's revenues increased by 26.5% to $999.5 million in 1996 compared
to $790.1 million in 1995. The Company's costs and operating expenses
increased by 24.8% to $906.4 million in 1996 from $726.2 million in 1995.
Operating margin increased by 45.8% to $93.1 million in 1996 from $63.9
million in 1995.     
   
  NGL Fractionation. The Company's operating margin for NGL fractionation
decreased by 30.4% to $2.0 million in 1996 from $2.8 million in 1995. Volume
increased from year to year as a result of the 45,000 barrel per day capacity
expansion at the Mont Belvieu facility which was completed in the fourth
quarter of 1996 and increased throughput from certain joint owners of the
fractionation facility. These increases in volumes were offset by increased
depreciation and operating expenses as a result of the expansion.     
   
  Isomerization. The Company's operating margin for isomerization increased by
128.5% to $51.1 million in 1996 from $22.4 million in 1995. Margins on sales
of isobutane processed by the Company increased, reflecting an increase in the
average spread between normal butane and isobutane from year to year.
Isomerization marketing margins increased significantly as a result of greater
annual increases in market prices for isobutane in 1996 than in 1995.
Processing fees for mixed butanes increased as a result of increased imports
of mixed butanes.     
 
  Propylene Fractionation. The Company's operating margin for propylene
fractionation increased by 7.1% to $18.3 million in 1996 from $17.1 million in
1995. The increase in operating margins reflected a 1.5% increase in volumes
from year to year and increases in high purity propylene prices in late 1996.
 
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