(
Enterprise reported net income attributable to common unitholders of
Distributable Cash Flow (“DCF”) was
Enterprise repurchased approximately
Adjusted cash flow from operations (“Adjusted CFFO”) was
Total capital investments were
Total debt principal outstanding at
Conference Call to Discuss First Quarter 2024 Earnings
Enterprise will host a conference call today to discuss first quarter 2024 earnings. The call will be webcast live beginning at
First Quarter 2024 Financial Highlights
|
|
Three Months Ended |
|||
|
|
2024 |
2023 |
||
|
($ in millions, except per unit amounts) |
|
|
||
|
Operating income (1) |
$ |
1,822 |
$ |
1,734 |
|
Net income (1) (2) |
$ |
1,483 |
$ |
1,422 |
|
Fully diluted earnings per common unit (2) |
$ |
0.66 |
$ |
0.63 |
|
Total gross operating margin (1) (3) |
$ |
2,490 |
$ |
2,335 |
|
Adjusted EBITDA (3) |
$ |
2,469 |
$ |
2,321 |
|
Adjusted CFFO (3) |
$ |
2,147 |
$ |
2,022 |
|
Adjusted FCF (3) |
$ |
1,079 |
$ |
1,347 |
|
DCF (3) |
$ |
1,915 |
$ |
1,938 |
|
Operational DCF (3) |
$ |
1,942 |
$ |
1,915 |
|
(1) |
Operating income, net income, and gross operating margin include non-cash, mark-to-market (“MTM”) losses on financial instruments used in our commodity hedging activities of |
|
(2) |
Net income and fully diluted earnings per common unit for the first quarters of 2024 and 2023 include non-cash, asset impairment and related charges of approximately |
|
(3) |
Total gross operating margin, adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”), Adjusted CFFO, adjusted free cash flow (“Adjusted FCF”), DCF and Operational Distributable Cash Flow (“Operational DCF”) are non-generally accepted accounting principle (“non-GAAP”) financial measures that are defined and reconciled later in this press release. |
| First Quarter 2024 Volume Highlights |
Three Months Ended
|
|
|
|
2024 |
2023 |
|
Equivalent pipeline transportation volumes (million BPD)(1) |
12.3 |
11.8 |
|
NGL, crude oil, refined products & petrochemical pipeline volumes (million BPD) |
7.4 |
7.1 |
|
Marine terminal volumes (million BPD) |
2.3 |
2.0 |
|
Natural gas pipeline volumes (TBtus/d) |
18.6 |
18.0 |
|
NGL fractionation volumes (MBPD) |
1,557 |
1,370 |
|
Propylene plant production volumes (MBPD) |
96 |
95 |
|
Fee-based natural gas processing volumes (Bcf/d) |
6.4 |
5.5 |
|
Equity NGL-equivalent production volumes (MBPD) |
185 |
160 |
|
(1) |
Represents total NGL, crude oil, refined products and petrochemical transportation volumes plus equivalent energy volumes where 3.8 million British thermal units (“MMBtus”) of natural gas transportation volumes are equivalent to one barrel of NGLs transported. |
As used in this press release, “NGL” means natural gas liquids, “LPG” means liquefied petroleum gas, “BPD” means barrels per day, “MBPD” means thousand barrels per day, “MMcf/d” means million cubic feet per day, “Bcf/d” means billion cubic feet per day, “BBtus/d” means billion British thermal units per day and “TBtus/d” means trillion British thermal units per day.
“Enterprise began 2024 with another strong quarter,” said A. J. “Jim”
“The partnership generated
“Near the end of the first quarter, we expanded our Permian natural gas processing infrastructure with the start of operations at our Leonidas plant in the
Review of First Quarter 2024 Results
Total gross operating margin was
NGL Pipelines & Services – Gross operating margin from the NGL Pipelines & Services segment was
Gross operating margin from the natural gas processing business and related NGL marketing activities was
-
Gross operating margin from NGL marketing activities increased
$22 million primarily due to higher average sales margins. -
Gross operating margin from Permian natural gas processing facilities, including the
Delaware Basin andMidland Basin assets, increased$33 million primarily due to higher fee-based processing volumes and higher margin-driven business performance.Delaware Basin fee-based processing volumes increased 160 MMcf/d largely resulting from the addition of theMentone 2 processing train, which was placed in service inOctober 2023 , and equity NGL-equivalent production volumes were flat.Midland Basin fee-based processing volumes increased 269 MMcf/d stemming from the addition of the Poseidon natural gas processing train, which was placed in service inJuly 2023 , and equity NGL-equivalent production volumes increased 13 MBPD. -
Gross operating margin from
South Texas natural gas processing facilities increased$11 million primarily due to higher average processing margins and lower maintenance costs, partially offset by the impact of a decrease in equity NGL-equivalent production volumes.South Texas fee-based gas processing volumes increased 57 MMcf/d, and equity NGL-equivalent production volumes decreased 9 MBPD. -
Gross operating margin from Rockies natural gas processing facilities decreased
$35 million primarily due to lower average processing margins, including the impact of hedging activities. Rockies fee-based gas processing volumes increased 339 MMcf/d, and equity NGL-equivalent production volumes increased 14 MBPD.
Gross operating margin from the NGL pipelines and storage business was
-
Gross operating margin from
Enterprise Hydrocarbons Terminal (“EHT”) increased$22 million primarily due to an 83 MBPD increase in LPG export volumes and higher average loading fees. Gross operating margin from Morgan’sPoint Ethane Export Terminal declined$8 million primarily due to lower average loading fees. Gross operating margin from the Houston Ship Channel Pipeline System increased$11 million in connection with higher average transportation fees and an 86 MBPD increase in transportation volumes. -
Eastern ethane pipelines, which include the ATEX and Aegis pipelines, reported a
$20 million increase in gross operating margin largely due to higher transportation revenues and volumes. Eastern ethane pipeline volumes increased 43 MBPD. -
Gross operating margin from the
Mont Belvieu Storage Complex increased$18 million primarily due to higher storage revenues. -
On a combined basis, the pipelines serving the Permian and
Rocky Mountain regions reported a$15 million increase in gross operating margin. This includes the Mid-America and Seminole NGL Pipeline Systems, Shin Oak NGL Pipeline and Chaparral NGL Pipeline. The variance was primarily driven by higher average transportation fees and a 45 MBPD, net to our interest, increase in transportation volumes, partially offset by higher operating costs. -
On a combined basis, gross operating margin from our equity investments in
Front Range Pipeline , Texas Express Pipeline, and Texas Express Gathering System decreased$12 million primarily due to a combined 16 MBPD, net to our interest, decrease in transportation volumes and lower transportation fees on the Texas Express systems. -
The South Texas NGL Pipeline System reported a
$7 million decrease in gross operating margin primarily due to lower average transportation related fees and higher operating costs, partially offset by the benefit of a 17 MBPD increase in transportation volumes.
Gross operating margin from the NGL fractionation business was
-
Gross operating margin from our Mont Belvieu NGL fractionation complex increased
$39 million primarily due to a 209 MBPD, net to our interest, increase in fractionation volumes. The increase in volume and gross operating margin was primarily due to the addition of Frac 12, which was placed in service inJuly 2023 .
Crude Oil Pipelines & Services – Gross operating margin from the Crude Oil Pipelines & Services segment was
-
The
Midland -to-ECHO Pipeline System and related business activities reported a net$21 million increase primarily due to higher transportation volumes in addition to higher average transportation fees and related margins, partially offset by higher variable operating costs. Transportation volumes on the system increased 65 MBPD, net to our interest. -
On a combined basis, gross operating margin from our
Texas in-basin crude oil pipelines, terminals and other marketing activities decreased$10 million primarily due to lower average sales margins and transportation fees, partially offset by higher sales volumes.
Natural Gas Pipelines & Services – Gross operating margin for the Natural Gas Pipelines & Services segment was
-
On a combined basis, gross operating margin from the Rocky Mountain Gathering Systems decreased
$37 million primarily due to lower average gathering fees indexed to regional natural gas prices. Gathering volumes on these systems, which include the Jonah Gathering, Piceance Basin Gathering, and San Juan Gathering systems, decreased a combined 16 BBtus/d, or 1 percent. -
Gross operating margin from the Texas Intrastate System increased
$14 million primarily due to higher capacity reservation and transportation revenues, in addition to lower operating costs. Transportation volumes increased 46 BBtus/d. -
Gross operating margin from our natural gas marketing business increased
$17 million primarily due to higher sales volumes and average margins. -
Permian natural gas gathering, including
Delaware Basin andMidland Basin Gathering Systems, reported a combined$4 million increase in gross operating margin primarily due to a 503 BBtus/d increase in gathering volumes, partially offset by higher operating costs.
Petrochemical & Refined Products Services – Gross operating margin for the Petrochemical & Refined Products Services segment was
-
Gross operating margin from our octane enhancement and related plant operations increased
$57 million primarily due to higher sales volumes and revenues. -
Gross operating margin from our ethylene business increased
$19 million primarily due to higher revenues on our pipelines and terminal assets. -
Propylene production and related activities reported a
$45 million decrease in gross operating margin. At ourMont Belvieu propylene production facilities, higher propylene processing revenues from the PDH 2 facility, which was placed in service inJuly 2023 , were offset by lower propylene sales revenues and higher operating costs. The partnership’s PDH 1 facility was down for approximately 52 days during the first quarter of 2024 for planned and unplanned maintenance, compared to 24 days in the same quarter last year. Certain of our propylene splitters were down approximately 32 days during the first quarter of this year for unplanned maintenance. Total propylene and associated by-product production volumes were 96 MBPD, net to our interest, including a 20 MBPD contribution from the PDH 2 facility.
Use of Non-GAAP Financial Measures
This press release and accompanying schedules include the non-GAAP financial measures of total gross operating margin, Adjusted CFFO, FCF, Adjusted FCF, DCF, Operational DCF and Adjusted EBITDA. The accompanying schedules provide definitions of these non-GAAP financial measures and reconciliations to their most directly comparable financial measure calculated and presented in accordance with GAAP. Our non-GAAP financial measures should not be considered as alternatives to GAAP measures such as net income, operating income, net cash flow provided by operating activities or any other measure of financial performance calculated and presented in accordance with GAAP. Our non-GAAP financial measures may not be comparable to similarly titled measures of other companies because they may not calculate such measures in the same manner as we do.
Company Information and Use of Forward-Looking Statements
This press release includes forward-looking statements. Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve certain risks and uncertainties, such as the partnership’s expectations regarding future results, capital expenditures, project completions, liquidity and financial market conditions. These risks and uncertainties include, among other things, insufficient cash from operations, adverse market conditions, governmental regulations and other factors discussed in Enterprise’s filings with the
|
|
Exhibit A |
||||||||
|
Condensed Statements of Consolidated Operations – UNAUDITED |
|
|
|||||||
|
($ in millions, except per unit amounts) |
|
|
|||||||
|
|
For the Three Months
|
For the Twelve
|
|||||||
|
|
2024 |
2023 |
2024 |
||||||
|
Revenues |
$ |
14,760 |
|
$ |
12,444 |
|
$ |
52,031 |
|
|
Costs and expenses: |
|
|
|
||||||
|
Operating costs and expenses |
|
12,974 |
|
|
10,757 |
|
|
45,234 |
|
|
General and administrative costs |
|
66 |
|
|
57 |
|
|
240 |
|
|
Total costs and expenses |
|
13,040 |
|
|
10,814 |
|
|
45,474 |
|
|
Equity in income of unconsolidated affiliates |
|
102 |
|
|
104 |
|
|
460 |
|
|
Operating income |
|
1,822 |
|
|
1,734 |
|
|
7,017 |
|
|
Other income (expense): |
|
|
|
||||||
|
Interest expense |
|
(331 |
) |
|
(314 |
) |
|
(1,286 |
) |
|
Other, net |
|
13 |
|
|
12 |
|
|
42 |
|
|
Total other expense, net |
|
(318 |
) |
|
(302 |
) |
|
(1,244 |
) |
|
Income before income taxes |
|
1,504 |
|
|
1,432 |
|
|
5,773 |
|
|
Provision for income taxes |
|
(21 |
) |
|
(10 |
) |
|
(55 |
) |
|
Net income |
|
1,483 |
|
|
1,422 |
|
|
5,718 |
|
|
Net income attributable to noncontrolling interests |
|
(26 |
) |
|
(31 |
) |
|
(120 |
) |
|
Net income attributable to preferred units |
|
(1 |
) |
|
(1 |
) |
|
(3 |
) |
|
Net income attributable to common unitholders |
$ |
1,456 |
|
$ |
1,390 |
|
$ |
5,595 |
|
|
Per common unit data (fully diluted): |
|
|
|
||||||
|
Earnings per common unit |
$ |
0.66 |
|
$ |
0.63 |
|
$ |
2.55 |
|
|
Average common units outstanding (in millions) |
|
2,193 |
|
|
2,195 |
|
|
2,192 |
|
|
|
|
|
|
||||||
|
Supplemental financial data: |
|
|
|
||||||
|
Net cash flow provided by operating activities |
$ |
2,111 |
|
$ |
1,583 |
|
$ |
8,097 |
|
|
Cash flows used in investing activities |
$ |
1,038 |
|
$ |
637 |
|
$ |
3,598 |
|
|
Cash flows used in financing activities |
$ |
1,009 |
|
$ |
876 |
|
$ |
4,391 |
|
|
Total debt principal outstanding at end of period |
$ |
29,721 |
|
$ |
28,871 |
|
$ |
29,721 |
|
|
|
|
|
|
||||||
|
Non-GAAP Distributable Cash Flow (1) |
$ |
1,915 |
|
$ |
1,938 |
|
$ |
7,578 |
|
|
Non-GAAP Operational Distributable Cash Flow (1) |
$ |
1,942 |
|
$ |
1,915 |
|
$ |
7,565 |
|
|
Non-GAAP Adjusted EBITDA (2) |
$ |
2,469 |
|
$ |
2,321 |
|
$ |
9,466 |
|
|
Non-GAAP Adjusted Cash flow from operations (3) |
$ |
2,147 |
|
$ |
2,022 |
|
$ |
8,249 |
|
|
Non-GAAP Free Cash Flow (4) |
$ |
1,043 |
|
$ |
908 |
|
$ |
4,391 |
|
|
Non-GAAP Adjusted Free Cash Flow (4) |
$ |
1,079 |
|
$ |
1,347 |
|
$ |
4,543 |
|
|
Gross operating margin by segment: |
|
|
|
||||||
|
NGL Pipelines & Services |
$ |
1,340 |
|
$ |
1,212 |
|
$ |
5,026 |
|
|
Crude Oil Pipelines & Services |
|
411 |
|
|
397 |
|
|
1,721 |
|
|
Natural Gas Pipelines & Services |
|
312 |
|
|
314 |
|
|
1,075 |
|
|
Petrochemical & Refined Products Services |
|
444 |
|
|
419 |
|
|
1,719 |
|
|
Total segment gross operating margin (5) |
|
2,507 |
|
|
2,342 |
|
|
9,541 |
|
|
Net adjustment for shipper make-up rights (6) |
|
(17 |
) |
|
(7 |
) |
|
9 |
|
|
Non-GAAP total gross operating margin (7) |
$ |
2,490 |
|
$ |
2,335 |
|
$ |
9,550 |
|
|
(1) |
See Exhibit F for reconciliation to GAAP net cash flow provided by operating activities. |
|
(2) |
See Exhibit G for reconciliation to GAAP net cash flow provided by operating activities. |
|
(3) |
See Exhibit E for reconciliation to GAAP net cash flow provided by operating activities. |
|
(4) |
See Exhibit D for reconciliation to GAAP net cash flow provided by operating activities. |
|
(5) |
Within the context of this table, total segment gross operating margin represents a subtotal and corresponds to measures similarly titled within the financial statement footnotes provided in our quarterly and annual filings with the |
|
(6) |
Gross operating margin by segment for NGL Pipelines & Services and Crude Oil Pipelines & Services reflects adjustments for non-refundable deferred transportation revenues relating to the make-up rights of committed shippers on certain major pipeline projects. These adjustments are included in managements’ evaluation of segment results. However, these adjustments are excluded from non-GAAP total gross operating margin in compliance with guidance from the |
|
(7) |
See Exhibit H for reconciliation to GAAP total operating income. |
|
|
Exhibit B |
||
|
Selected Operating Data – UNAUDITED |
|||
|
|
|
|
|
|
|
For the Three Months
|
For the Twelve
|
|
|
|
2024 |
2023 |
2024 |
|
Selected operating data: (1) |
|
|
|
|
NGL Pipelines & Services, net: |
|
|
|
|
NGL pipeline transportation volumes (MBPD) |
4,157 |
3,975 |
4,084 |
|
NGL marine terminal volumes (MBPD) |
895 |
824 |
838 |
|
NGL fractionation volumes (MBPD) |
1,557 |
1,370 |
1,558 |
|
Equity NGL-equivalent production volumes (MBPD) (2) |
185 |
160 |
182 |
|
Fee-based natural gas processing volumes (MMcf/d) (3,4) |
6,363 |
5,541 |
6,052 |
|
Crude Oil Pipelines & Services, net: |
|
|
|
|
Crude oil pipeline transportation volumes (MBPD) |
2,381 |
2,300 |
2,481 |
|
Crude oil marine terminal volumes (MBPD) |
1,094 |
841 |
974 |
|
Natural Gas Pipelines & Services, net: |
|
|
|
|
Natural gas pipeline transportation volumes (BBtus/d) (5) |
18,615 |
18,023 |
18,511 |
|
Petrochemical & Refined Products Services, net: |
|
|
|
|
Propylene production volumes (MBPD) |
96 |
95 |
100 |
|
Butane isomerization volumes (MBPD) |
117 |
98 |
116 |
|
Standalone DIB processing volumes (MBPD) |
196 |
152 |
187 |
|
Octane enhancement and related plant sales volumes (MBPD) (6) |
35 |
25 |
38 |
|
Pipeline transportation volumes, primarily refined products and petrochemicals (MBPD) |
859 |
782 |
861 |
|
Refined products and petrochemicals marine terminal volumes (MBPD) (7) |
330 |
321 |
324 |
|
Total, net: |
|
|
|
|
NGL, crude oil, petrochemical and refined products pipeline transportation volumes (MBPD) |
7,397 |
7,057 |
7,426 |
|
Natural gas pipeline transportation volumes (BBtus/d) |
18,615 |
18,023 |
18,511 |
|
Equivalent pipeline transportation volumes (MBPD) (8) |
12,296 |
11,800 |
12,297 |
|
NGL, crude oil, refined products and petrochemical marine terminal volumes (MBPD) |
2,319 |
1,986 |
2,136 |
|
(1) |
Operating rates are reported on a net basis, which take into account our ownership interests in certain joint ventures and include volumes for newly constructed assets from the related in-service dates and for recently purchased assets from the related acquisition dates. |
|
(2) |
Primarily represents the NGL and condensate volumes we earn and take title to in connection with our processing activities. The total equity NGL-equivalent production volumes also include residue natural gas volumes from our natural gas processing business. |
|
(3) |
Volumes reported correspond to the revenue streams earned by our gas plants. “MMcf/d” means million cubic feet per day. |
|
(4) |
Fee-based natural gas processing volumes are measured at either the wellhead or plant inlet in MMcf/d. |
|
(5) |
“BBtus/d” means billion British thermal units per day. |
|
(6) |
Reflects aggregate sales volumes for our octane enhancement and isobutane dehydrogenation (“iBDH”) facilities located at our |
|
(7) |
In addition to exports of refined products, these amounts include loading volumes at our ethylene export terminal. |
|
(8) |
Represents total NGL, crude oil, refined products and petrochemical transportation volumes plus equivalent energy volumes where 3.8 million British thermal units (“MMBtus”) of natural gas transportation volumes are equivalent to one barrel of NGLs transported. |
|
|
|
Exhibit C |
|
Selected Commodity Price Information – UNAUDITED |
|
|
|
|
|
|
|
|
|
|
Polymer |
Refinery |
||||||||
|
|
Natural |
|
|
Normal |
|
Natural |
Grade |
Grade |
||||||||
|
|
Gas, |
Ethane, |
Propane, |
Butane, |
Isobutane, |
Gasoline, |
Propylene, |
Propylene, |
||||||||
|
|
$/MMBtu (1) |
$/gallon (2) |
$/gallon (2) |
$/gallon (2) |
$/gallon (2) |
$/gallon (2) |
$/pound (3) |
$/pound (3) |
||||||||
|
2023 by quarter: |
|
|
|
|
|
|
|
|
||||||||
|
First Quarter |
|
|
|
|
|
|
|
|
||||||||
|
Second Quarter |
|
|
|
|
|
|
|
|
||||||||
|
Third Quarter |
|
|
|
|
|
|
|
|
||||||||
|
Fourth Quarter |
|
|
|
|
|
|
|
|
||||||||
|
2023 Averages |
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
2024 by quarter: |
|
|
|
|
|
|
|
|
||||||||
|
First Quarter |
|
|
|
|
|
|
|
|
|
(1) |
Natural gas prices are based on Henry-Hub Inside FERC commercial index prices as reported by Platts, which is a division of S&P Global, Inc. |
|
(2) |
NGL prices for ethane, propane, normal butane, isobutane and natural gasoline are based on Mont Belvieu Non-TET commercial index prices as reported by |
|
(3) |
Polymer grade propylene prices represent average contract pricing for such product as reported by IHS Markit ("IHS”), which is a division of S&P Global, Inc. Refinery grade propylene prices represent weighted-average spot prices for such product as reported by IHS. |
|
|
WTI |
|
|
LLS |
||||
|
|
Crude Oil, |
Crude Oil, |
Crude Oil |
Crude Oil, |
||||
|
|
$/barrel (1) |
$/barrel (2) |
$/barrel (2) |
$/barrel (3) |
||||
|
2023 by quarter: |
|
|
|
|
||||
|
First Quarter |
|
|
|
|
||||
|
Second Quarter |
|
|
|
|
||||
|
Third Quarter |
|
|
|
|
||||
|
Fourth Quarter |
|
|
|
|
||||
|
2023 Averages |
|
|
|
|
||||
|
|
|
|
|
|
||||
|
2024 by quarter: |
|
|
|
|
||||
|
First Quarter |
|
|
|
|
|
(1) |
West Texas Intermediate (“WTI”) prices are based on commercial index prices at |
|
(2) |
|
|
(3) |
Light Louisiana Sweet (“LLS”) prices are based on commercial index prices as reported by Platts. |
The weighted-average indicative market price for NGLs (based on prices for such products at
|
|
Exhibit D |
|||||
|
Free Cash Flow and Adjusted Free Cash Flow – UNAUDITED |
|
|||||
|
($ in millions) |
|
|||||
|
|
For the Three Months
|
|||||
|
|
2024 |
2023 |
||||
|
Free Cash Flow (“FCF”) and Adjusted FCF |
|
|
||||
|
Net cash flow provided by operating activities (GAAP) |
$ |
2,111 |
|
$ |
1,583 |
|
|
Adjustments to reconcile net cash flow provided by operating activities to FCF and Adjusted FCF (addition or subtraction indicated by sign): |
|
|
||||
|
Cash used in investing activities |
|
(1,038 |
) |
|
(637 |
) |
|
Cash contributions from noncontrolling interests |
|
8 |
|
|
4 |
|
|
Cash distributions paid to noncontrolling interests |
|
(38 |
) |
|
(42 |
) |
|
FCF (non-GAAP) |
$ |
1,043 |
|
$ |
908 |
|
|
Net effect of changes in operating accounts, as applicable |
|
36 |
|
|
439 |
|
|
Adjusted FCF (non-GAAP) |
$ |
1,079 |
|
$ |
1,347 |
|
|
|
|
|
||||
|
|
|
|
||||
|
|
For the Twelve Months
|
|||||
|
|
2024 |
2023 |
||||
|
Net cash flow provided by operating activities (GAAP) |
$ |
8,097 |
|
$ |
7,477 |
|
|
Adjustments to reconcile net cash flow provided by operating activities to FCF and Adjusted FCF (addition or subtraction indicated by sign): |
|
|
||||
|
Cash used in investing activities |
|
(3,598 |
) |
|
(2,059 |
) |
|
Cash contributions from noncontrolling interests |
|
48 |
|
|
9 |
|
|
Cash distributions paid to noncontrolling interests |
|
(156 |
) |
|
(163 |
) |
|
FCF (non-GAAP) |
$ |
4,391 |
|
$ |
5,264 |
|
|
Net effect of changes in operating accounts, as applicable |
|
152 |
|
|
684 |
|
|
Adjusted FCF (non-GAAP) |
$ |
4,543 |
|
$ |
5,948 |
|
FCF is a non-GAAP measure of how much cash a business generates after accounting for capital expenditures such as plants or pipelines. Additionally, Adjusted FCF is a non-GAAP measure of how much cash a business generates, excluding the net effect of changes in operating accounts, after accounting for capital expenditures. We believe that FCF is important to traditional investors since it reflects the amount of cash available for reducing debt, investing in additional capital projects and/or paying distributions. We believe that Adjusted FCF is also important to traditional investors for the same reasons as FCF, without regard for fluctuations caused by timing of when amounts earned or incurred were collected, received or paid from period to period. Since we partner with other companies to fund certain capital projects of our consolidated subsidiaries, our determination of FCF and Adjusted FCF appropriately reflect the amount of cash contributed from and distributed to noncontrolling interests.
|
|
Exhibit E |
|||||||
|
Adjusted Cash flow from operations – UNAUDITED |
||||||||
|
($ in millions) |
|
|
||||||
|
|
For the Three Months
|
For the Twelve Months
|
||||||
|
|
2024 |
2023 |
2024 |
2023 |
||||
|
Adjusted Cash flow from operations (“Adjusted CFFO”) |
|
|
|
|
||||
|
Net cash flow provided by operating activities (GAAP) |
$ |
2,111 |
$ |
1,583 |
$ |
8,097 |
$ |
7,477 |
|
Adjustments to reconcile net cash flow provided by operating activities to Adjusted Cash flow from operations (addition or subtraction indicated by sign): |
|
|
|
|
||||
|
Net effect of changes in operating accounts, as applicable |
|
36 |
|
439 |
|
152 |
|
684 |
|
Adjusted CFFO (non-GAAP) |
$ |
2,147 |
$ |
2,022 |
$ |
8,249 |
$ |
8,161 |
Adjusted CFFO is a non-GAAP measure that represents net cash flow provided by operating activities before the net effect of changes in operating accounts. We believe that it is important to consider this non-GAAP measure as it can often be a better way to measure the amount of cash generated from our operations that can be used to fund our capital investments or return value to our investors through cash distributions and buybacks, without regard for fluctuations caused by timing of when amounts earned or incurred were collected, received or paid from period to period.
|
|
Exhibit F |
||||||||
|
Distributable Cash Flow and Operational Distributable Cash Flow – UNAUDITED |
|
||||||||
|
($ in millions) |
|
|
|||||||
|
|
For the Three Months
|
For the Twelve
|
|||||||
|
|
2024 |
2023 |
2024 |
||||||
|
Distributable Cash Flow (“DCF”) and Operational DCF |
|
|
|
||||||
|
Net income attributable to common unitholders (GAAP) |
$ |
1,456 |
|
$ |
1,390 |
|
$ |
5,595 |
|
|
Adjustments to net income attributable to common unitholders to derive DCF (addition or subtraction indicated by sign): |
|
|
|
||||||
|
Depreciation, amortization and accretion expenses |
|
616 |
|
|
567 |
|
|
2,392 |
|
|
Cash distributions received from unconsolidated affiliates |
|
112 |
|
|
119 |
|
|
481 |
|
|
Equity in income of unconsolidated affiliates |
|
(102 |
) |
|
(104 |
) |
|
(460 |
) |
|
Asset impairment charges |
|
20 |
|
|
13 |
|
|
39 |
|
|
Change in fair market value of derivative instruments |
|
4 |
|
|
3 |
|
|
34 |
|
|
Deferred income tax expense |
|
9 |
|
|
3 |
|
|
18 |
|
|
Sustaining capital expenditures (1) |
|
(180 |
) |
|
(84 |
) |
|
(509 |
) |
|
Other, net |
|
7 |
|
|
8 |
|
|
(25 |
) |
|
Operational DCF (non-GAAP) |
|
1,942 |
|
|
1,915 |
|
|
7,565 |
|
|
Proceeds from asset sales and other matters |
|
2 |
|
|
2 |
|
|
42 |
|
|
Monetization of interest rate derivative instruments accounted for as cash flow hedges |
|
(29 |
) |
|
21 |
|
|
(29 |
) |
|
DCF (non-GAAP) |
$ |
1,915 |
|
$ |
1,938 |
|
$ |
7,578 |
|
|
Adjustments to reconcile DCF with net cash flow provided by operating activities (addition or subtraction indicated by sign): |
|
|
|
||||||
|
Net effect of changes in operating accounts, as applicable |
|
(36 |
) |
|
(439 |
) |
|
(152 |
) |
|
Sustaining capital expenditures |
|
180 |
|
|
84 |
|
|
509 |
|
|
Other, net |
|
52 |
|
|
– |
|
|
162 |
|
|
Net cash flow provided by operating activities (GAAP) |
$ |
2,111 |
|
$ |
1,583 |
|
$ |
8,097 |
|
|
(1) |
Sustaining capital expenditures are capital expenditures (as defined by GAAP) resulting from improvements to and major renewals of existing assets. Such expenditures serve to maintain existing operations but do not generate additional revenues. |
DCF is an important non-GAAP liquidity measure for our common unitholders since it serves as an indicator of our success in providing a cash return on investment. Specifically, this liquidity measure indicates to investors whether or not we are generating cash flows at a level that can sustain or support an increase in our quarterly cash distributions. DCF is also a quantitative standard used by the investment community with respect to publicly traded partnerships because the value of a partnership unit is, in part, measured by its yield, which is based on the amount of cash distributions a partnership can pay to a common unitholder.
Operational DCF, which is defined as DCF excluding the impact of proceeds from asset sales and other matters and monetization of interest rate derivative instruments, is a supplemental non-GAAP liquidity measure that quantifies the portion of cash available for distribution to common unitholders that was generated from our normal operations. We believe that it is important to consider this non-GAAP measure as it provides an enhanced perspective of our assets’ ability to generate cash flows without regard for certain items that do not reflect our core operations.
The GAAP measure most directly comparable to DCF and Operational DCF is net cash flow provided by operating activities.
|
|
Exhibit G |
||||||||
|
Adjusted EBITDA - UNAUDITED |
|
||||||||
|
($ in millions) |
|
|
|||||||
|
|
For the Three Months
|
For the Twelve
|
|||||||
|
|
2024 |
2023 |
2024 |
||||||
|
Net income (GAAP) |
$ |
1,483 |
|
$ |
1,422 |
|
$ |
5,718 |
|
|
Adjustments to net income to derive Adjusted EBITDA (addition or subtraction indicated by sign): |
|
|
|
||||||
|
Depreciation, amortization and accretion in costs and expenses (1) |
|
600 |
|
|
546 |
|
|
2,321 |
|
|
Interest expense, including related amortization |
|
331 |
|
|
314 |
|
|
1,286 |
|
|
Cash distributions received from unconsolidated affiliates |
|
112 |
|
|
119 |
|
|
481 |
|
|
Equity in income of unconsolidated affiliates |
|
(102 |
) |
|
(104 |
) |
|
(460 |
) |
|
Asset impairment charges |
|
20 |
|
|
13 |
|
|
39 |
|
|
Provision for income taxes |
|
21 |
|
|
10 |
|
|
55 |
|
|
Change in fair market value of commodity derivative instruments |
|
4 |
|
|
3 |
|
|
34 |
|
|
Other, net |
|
– |
|
|
(2 |
) |
|
(8 |
) |
|
Adjusted EBITDA (non-GAAP) |
|
2,469 |
|
|
2,321 |
|
|
9,466 |
|
|
Adjustments to reconcile Adjusted EBITDA to net cash flow provided by operating activities (addition or subtraction indicated by sign): |
|
|
|
||||||
|
Interest expense, including related amortization |
|
(331 |
) |
|
(314 |
) |
|
(1,286 |
) |
|
Deferred income tax expense |
|
9 |
|
|
3 |
|
|
18 |
|
|
Provision for income taxes |
|
(21 |
) |
|
(10 |
) |
|
(55 |
) |
|
Net effect of changes in operating accounts, as applicable |
|
(36 |
) |
|
(439 |
) |
|
(152 |
) |
|
Other, net |
|
21 |
|
|
22 |
|
|
106 |
|
|
Net cash flow provided by operating activities (GAAP) |
$ |
2,111 |
|
$ |
1,583 |
|
$ |
8,097 |
|
|
(1) |
Excludes amortization of major maintenance costs for reaction-based plants, which are a component of Adjusted EBITDA. |
Adjusted EBITDA is commonly used as a supplemental financial measure by our management and external users of our financial statements, such as investors, commercial banks, research analysts and rating agencies, to assess the financial performance of our assets without regard to financing methods, capital structures or historical cost basis; the ability of our assets to generate cash sufficient to pay interest and support our indebtedness; and the viability of projects and the overall rates of return on alternative investment opportunities.
Since Adjusted EBITDA excludes some, but not all, items that affect net income or loss and because these measures may vary among other companies, the Adjusted EBITDA data presented in this press release may not be comparable to similarly titled measures of other companies. The GAAP measure most directly comparable to Adjusted EBITDA is net cash flow provided by operating activities.
|
|
Exhibit H |
||||||||
|
Gross Operating Margin – UNAUDITED |
|
||||||||
|
($ in millions) |
|
|
|||||||
|
|
For the Three Months
|
For the Twelve
|
|||||||
|
|
2024 |
2023 |
2024 |
||||||
|
Total gross operating margin (non-GAAP) |
$ |
2,490 |
|
$ |
2,335 |
|
$ |
9,550 |
|
|
Adjustments to reconcile total gross operating margin to total operating income (addition or subtraction indicated by sign): |
|
|
|
||||||
|
Depreciation, amortization and accretion expense in operating costs and expenses (1) |
|
(582 |
) |
|
(533 |
) |
|
(2,264 |
) |
|
Asset impairment charges in operating costs and expenses |
|
(20 |
) |
|
(13 |
) |
|
(37 |
) |
|
Net gains attributable to asset sales and related matters in operating costs and expenses |
|
– |
|
|
2 |
|
|
8 |
|
|
General and administrative costs |
|
(66 |
) |
|
(57 |
) |
|
(240 |
) |
|
Total operating income (GAAP) |
$ |
1,822 |
|
$ |
1,734 |
|
$ |
7,017 |
|
|
(1) |
Excludes amortization of major maintenance costs for reaction-based plants, which are a component of gross operating margin. |
We evaluate segment performance based on our financial measure of gross operating margin. Gross operating margin is an important performance measure of the core profitability of our operations and forms the basis of our internal financial reporting. We believe that investors benefit from having access to the same financial measures that our management uses in evaluating segment results.
The term “total gross operating margin” represents GAAP operating income exclusive of (i) depreciation, amortization and accretion expenses (excluding amortization of major maintenance costs for reaction-based plants), (ii) impairment charges, (iii) gains and losses attributable to asset sales and related matters, and (iv) general and administrative costs. Total gross operating margin includes equity in the earnings of unconsolidated affiliates, but is exclusive of other income and expense transactions, income taxes, the cumulative effect of changes in accounting principles and extraordinary charges. Total gross operating margin is presented on a 100 percent basis before any allocation of earnings to noncontrolling interests. The GAAP financial measure most directly comparable to total gross operating margin is operating income.
Total gross operating margin excludes amounts attributable to shipper make-up rights as described in footnote (6) to Exhibit A of this press release.
|
|
Exhibit I |
|||||
|
Other Information – UNAUDITED |
|
|||||
|
($ in millions) |
|
|
||||
|
|
For the Three Months
|
For the Twelve
|
||||
|
|
2024 |
2023 |
2024 |
|||
|
Capital investments: |
|
|
|
|||
|
Capital expenditures |
$ |
1,047 |
$ |
653 |
$ |
3,660 |
|
Investments in unconsolidated affiliates |
|
– |
|
– |
|
2 |
|
Other investing activities |
|
8 |
|
1 |
|
20 |
|
Total capital investments |
$ |
1,055 |
$ |
654 |
$ |
3,682 |
The following table summarizes the non-cash mark-to-market gains (losses) for the periods indicated:
|
|
|
For the Twelve
|
|||||||
|
|
For the Three Months
|
||||||||
|
|
2024 |
2023 |
2024 |
||||||
|
Mark-to-market gains (losses) in gross operating margin: |
|
|
|
||||||
|
NGL Pipelines & Services |
$ |
(7 |
) |
$ |
(14 |
) |
$ |
(18 |
) |
|
Crude Oil Pipelines & Services |
|
4 |
|
|
13 |
|
|
(14 |
) |
|
Natural Gas Pipelines & Services |
|
(2 |
) |
|
(2 |
) |
|
(1 |
) |
|
Petrochemical & Refined Products Services |
|
1 |
|
|
– |
|
|
(1 |
) |
|
Total mark-to-market impact on gross operating margin |
$ |
(4 |
) |
$ |
(3 |
) |
$ |
(34 |
) |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240430967452/en/
Source:
1-866-230-0745 
investor.relations@eprod.com 
