Enterprise Products Partners L.P.

SEC Filings

10-K405
TEPPCO PARTNERS LP filed this Form 10-K405 on 03/03/1998
Entire Document
 
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LPGs terminaling fees and increased revenues resulting from greater volumes
marketed between customers at the Mont Belvieu complex.

        Costs and expenses increased $1.4 million during the year ended
December 31, 1996, compared with the prior year, due primarily to a $1.1
million increase in taxes - other than income taxes, and a $0.1 million
increase in operating, general and administrative expenses.  The increase in
taxes - other than income taxes, was attributable to a $0.9 million adjustment
recorded during 1995 related to the reclassification of the Partnership as a
non-utility for Ohio property taxes.  Operating, general and administrative
expenses increased in 1996 as a result of higher throughput-related expenses
including higher mainline power costs, increased usage of propane odorant and
gasoline additives, and expenses for external barges utilized during the fourth
quarter of 1996.  Additionally, expenses were higher during 1996 due to
increased System maintenance, coupled with increased labor and benefits costs.
These increases were largely offset by $7.4 million of charges during 1995
related to the settlement of certain claims and environmental remediation costs
at the Partnership's Seymour, Indiana, terminal.

        Interest expense decreased $0.9 million during the year ended December
31, 1996, compared with 1995, due to the $10.0 million principal payment on the
First Mortgage Notes in March 1996.  Interest capitalized increased $0.5
million over the prior year as a result of increased capital spending during
1996.

FINANCIAL CONDITION AND LIQUIDITY

        Net cash from operations for the year ended December 31, 1997, totaled
$83.6 million, comprised of $85.1 million of income before charges for
depreciation and amortization, partially offset by $1.5 million used for
working capital changes.  This compares with cash flows from operations of
$86.1 million for the year ended 1996, which was comprised of $82.1 million of
income before charges for depreciation and amortization and $4.0 million from
working capital changes.  The $2.5 million decrease in cash provided by
operations in 1997 resulted from higher accounts receivable balances at
December 31, 1997, as compared to December 31, 1996, and lower product
inventory sales during 1997, partially offset by higher income earned in 1997
and lower cash payments for accrued expenses in 1997.  Net cash from operations
for the year ended December 31, 1995 totaled $78.5 million, which was comprised
of $70.0 million of income before charges for depreciation and amortization and
$8.5 million of cash provided by other working capital changes.  Net cash from
operations include interest payments related to the First Mortgage Notes (the
"Notes") of $33.6 million, $34.7 million and $35.5 million for each of the
years ended 1997, 1996 and 1995, respectively.

        The Partnership routinely invests excess cash in liquid investments as
part of its cash management program.  Investments of cash in discounted
commercial paper and Eurodollar time deposits with original maturities at date
of purchase of 90 days or less are included in cash and cash equivalents.
Short-term investments of cash consist of investment-grade corporate notes with
maturities during 1998. Long-term investments are comprised of investment-grade
corporate notes with varying maturities between 1999 and 2002.  Interest income
earned on all investments is included in cash from operations.   Cash flows
from investing activities included proceeds from investments of $25.0 million,
$18.6 million and $69.0 million for each of the years ended 1997, 1996 and
1995, respectively.  Cash flows from investing activities also included
additional investments of $6.2 million, $14.4 million and $62.4 million for
each of the years ended 1997, 1996 and 1995, respectively.  Cash balances
related to the investment of cash and proceeds from the investment of cash were
$56.1 million, $65.0 million and $74.9 million for the years ended December 31,
1997, 1996 and 1995, respectively.  The increase in cash investments in 1995
was in anticipation of an increase in capital expenditures which were incurred
in 1996 and were funded by proceeds from investments.  Capital expenditures
were $32.9 million, $51.3 million and $26.0 million for the years ended
December 31, 1997, 1996 and 1995, respectively.

        Capital expenditures totaled $32.9 million for the year ended December
31, 1997, compared with capital expenditures of $51.3 million for the year
ended December 31, 1996.  The decrease in 1997 reflects a $25.3 million
decrease in spending for revenue-generating projects due to higher construction
costs incurred in 1996 for the replacement of approximately 54 miles of an
8-inch diameter line with a 10-inch diameter line between Shreveport,
Louisiana, and El Dorado, Arkansas, which was placed in service on March 31,
1997; pipeline modifications to





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