UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT PURSUANT
TO
SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of
Report (Date of earliest event reported): November 9,
2009
ENTERPRISE
GP HOLDINGS L.P.
(Exact
name of registrant as specified in its charter)
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Delaware
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1-32610
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13-4297064
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(State
or Other Jurisdiction of
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(Commission
File Number)
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(I.R.S.
Employer
|
|
Incorporation
or Organization)
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Identification
No.)
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1100
Louisiana, 10th Floor
Houston,
Texas 77002
(Address
of Principal Executive Offices, including Zip Code)
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(713)
381-6500
(Registrant’s
Telephone Number, including Area
Code)
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Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
¨ Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
¨ Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item
2.02. Results of Operations and Financial Condition.
On
November 9, 2009, Enterprise GP Holdings L.P. issued a press release regarding
its consolidated and parent-only financial results for the three and nine months
ended September 30, 2009. A copy of the earnings press release is
furnished as Exhibit 99.1 to this Current Report on Form 8-K, which is
incorporated by reference into this Item 2.02.
Significant
Relationships
Enterprise GP Holdings L.P. is a
publicly traded Delaware limited partnership, the limited partnership interests
(the “Units”) of which are listed on the New York Stock Exchange (“NYSE”) under
the ticker symbol “EPE.” The business of Enterprise GP Holdings L.P.
is the ownership of general and limited partner interests of publicly traded
partnerships engaged in the midstream energy industry and related
businesses. Unless the context requires otherwise, references to
“we,” “us,” “our” or the “Partnership” are intended to mean the business and
operations of Enterprise GP Holdings L.P. and its consolidated
subsidiaries.
References to “Parent Company” mean
Enterprise GP Holdings L.P., individually as the parent company, and not on a
consolidated basis. The Parent Company is owned 99.99% by its limited
partners and 0.01% by its general partner, EPE Holdings, LLC (“EPE
Holdings”). EPE Holdings is a wholly owned subsidiary of Dan Duncan,
LLC, the membership interests of which are owned by Dan L. Duncan.
References to “Enterprise Products
Partners” mean Enterprise Products Partners L.P., the common units of which are
listed on the NYSE under the ticker symbol “EPD” and its consolidated
subsidiaries. Enterprise Products Partners has no business activities
outside those conducted by its operating subsidiary, Enterprise Products
Operating LLC (“EPO”). References to “EPGP” refer to Enterprise
Products GP, LLC, which is the general partner of Enterprise Products
Partners. The Parent Company owns EPGP.
References to “Duncan Energy Partners”
mean Duncan Energy Partners L.P., which is a consolidated subsidiary of EPO and
a publicly traded Delaware limited partnership, the common units of which are
listed on the NYSE under the ticker symbol “DEP.”
References to “TEPPCO” and “TEPPCO GP”
mean TEPPCO Partners, L.P. and Texas Eastern Products Pipeline Company, LLC
(which is the general partner of TEPPCO), respectively, prior to their mergers
with subsidiaries of Enterprise Products Partners. On October 26, 2009,
Enterprise Products Partners completed these mergers with TEPPCO and TEPPCO GP
(such related mergers referred herein individually and together as the “TEPPCO
Merger”).
References
to “Energy Transfer Equity” mean the business and operations of Energy Transfer
Equity, L.P. and its consolidated subsidiaries, which includes Energy Transfer
Partners, L.P. (“ETP”). Energy Transfer Equity is a publicly traded
Delaware limited partnership, the common units of which are listed on the NYSE
under the ticker symbol “ETE.” The general partner of Energy Transfer Equity is
LE GP, LLC (“LE GP”). The Parent Company has noncontrolling interests
in both Energy Transfer Equity and LE GP that it accounts for using the equity
method of accounting.
References to “EPCO” mean EPCO, Inc.
and its privately held affiliates, which are related parties to all of the
foregoing named entities. Mr. Duncan is the Group Co-Chairman and
controlling shareholder of EPCO.
The
Parent Company, Enterprise Products Partners, EPGP, TEPPCO, TEPPCO GP and EPCO
are affiliates under common control of Mr. Duncan. We do not control Energy
Transfer Equity or LE GP.
Basis
of Financial Statement Presentation
General Purpose Consolidated and
Parent Company-Only Information
In
accordance with rules and regulations of the U.S. Securities and Exchange
Commission (“SEC”) and various other accounting standard-setting organizations,
our general purpose financial statements reflect the consolidation of the
financial information of businesses that we control through the ownership of
general partner interests (e.g., Enterprise Products Partners and
TEPPCO). Our general purpose consolidated financial statements
present those investments in which we do not have a controlling interest as
unconsolidated affiliates (e.g., Energy Transfer Equity and LE
GP). To the extent that Enterprise Products Partners and TEPPCO
reflect investments in
1
unconsolidated
affiliates in their respective consolidated financial statements, such
investments will also be reflected as such in our general purpose consolidated
financial statements unless subsequently consolidated by us due to common
control considerations (e.g., Jonah Gas Gathering Company). As
presented in our consolidated financial statements, noncontrolling interest
reflects third-party and related party ownership of our consolidated
subsidiaries, which include the third-party and related party unitholders of
Enterprise Products Partners, TEPPCO and Duncan Energy
Partners.
In order
for the unitholders of Enterprise GP Holdings L.P. and others to more fully
understand the Parent Company’s business activities and financial statements on
a standalone basis, our press release includes information devoted exclusively
to the Parent Company apart from that of our consolidated
Partnership. A key difference between the non-consolidated Parent
Company financial information and those of our consolidated Partnership is that
the Parent Company views each of its investments (e.g., Enterprise Products
Partners, TEPPCO and Energy Transfer Equity) as unconsolidated affiliates and
records its share of the net income of each investee as equity
earnings. In accordance with U.S. generally accepted accounting
principles (“GAAP”), we eliminate such equity earnings in the preparation of our
consolidated Partnership financial statements.
Presentation
of Investments
Enterprise
Products Partners and EPGP. The Parent Company owns common
units of Enterprise Products Partners and 100% of the membership interests of
EPGP, which is entitled to 2% of the cash distributions paid by Enterprise
Products Partners as well as the associated incentive distribution rights
(“IDRs”) of Enterprise Products Partners. At September 30, 2009 and
2008, the Parent Company owned 13,952,402 and 13,454,498 common units,
respectively, of Enterprise Products Partners.
TEPPCO
and TEPPCO GP. At September 30, 2009, the Parent Company owned
4,400,000 units of TEPPCO and all of the membership interests of TEPPCO GP,
which is entitled to 2% of the cash distributions of TEPPCO as well as the IDRs
of TEPPCO. On October 26, 2009, the TEPPCO Merger was completed and
TEPPCO and TEPPCO GP became wholly owned subsidiaries of Enterprise Products
Partners. As a result, the Parent Company’s ownership interests in
the TEPPCO units were converted to 5,456,000 common units of Enterprise Products
Partners. In addition, the Parent Company’s membership interests in
TEPPCO GP were exchanged for (i) 1,331,681 common units of Enterprise Products
Partners and (ii) EPGP (on behalf of the Parent Company as a wholly-owned
subsidiary of the Parent Company) was credited in its Enterprise Products
Partners’ capital account an amount to maintain its 2% general partner interest
in Enterprise Products Partners.
Energy
Transfer Equity and LE GP. The Parent Company owns 38,976,090
common units of Energy Transfer Equity. In addition, at September 30,
2009 and 2008, the Parent Company owned approximately 40.6% and 34.9%,
respectively, of the membership interests of LE GP.
Use
of Non-GAAP Financial Measures
The press release and accompanying
schedules include the non-generally accepted accounting principle (“non-GAAP”)
financial measure of distributable cash flow. Exhibit C to the press
release provides a reconciliation of this non-GAAP financial measure to its most
directly comparable financial measure calculated in accordance with GAAP, net
cash flow provided by operating activities. Distributable cash flow
should not be considered an alternative to GAAP financial measures such as net
income, net cash flow provided by operating activities or any other GAAP measure
of liquidity or financial performance. We define distributable cash
flow as follows:
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§
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Cash
distributions expected to be received from the Parent Company’s
investments in limited and general partner interests (including related
IDRs, if any, held by these general partners); less the sum
of,
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§
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Parent
Company general and administrative costs on a standalone
basis;
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§
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Parent
Company interest expense on a standalone basis, before non-cash
amortization; and
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§
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the
general and administrative costs, on a standalone basis, of the general
partners of Enterprise Products Partners and
TEPPCO.
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Distributable
cash flow is a significant liquidity metric used by senior management to compare
net cash flow generated by the Parent Company’s investments to the cash
distributions the Parent Company is expected to pay its
2
partners. Using
this metric, senior management can quickly compute the coverage ratio of
estimated cash flow to planned cash distributions.
Distributable cash flow is an important
non-GAAP financial measure for the Parent Company’s unitholders since it
indicates to investors whether or not the Parent Company’s investments are
generating cash flow at a level that can sustain or support an increase in
quarterly cash distribution levels. Financial metrics such as
distributable cash flow are quantitative standards used by the investment
community 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 pays to
a unitholder.
Item
9.01. Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit No.
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Description
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99.1
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Enterprise
GP Holdings L.P. press release dated November 9,
2009.
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this Report to be signed on its behalf by the undersigned hereunto
duly authorized.
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ENTERPRISE
GP HOLDINGS L.P.
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||||||
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By:
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EPE
Holdings, LLC,
as
general partner
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|||||
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Date:
November 9, 2009
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By:
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/s/
Michael J. Knesek
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||||
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Name:
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Michael
J. Knesek
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|||||
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Title:
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Senior
Vice President, Controller and Principal
Accounting
Officer of the general partner
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|||||
3
Exhibit
Index
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Exhibit No.
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Description
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99.1
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Enterprise
GP Holdings L.P. press release dated November 9,
2009.
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4
Exhibit
99.1
P.O.
Box 4323
Houston,
TX 77210
(713)
381-6500
Enterprise
GP Holdings Reports Third Quarter 2009 Results
Houston,
Texas (Monday, November 9, 2009) – Enterprise GP Holdings L.P. (NYSE: EPE) today
announced its consolidated and parent-only financial results for the three and
nine months ended September 30, 2009. Enterprise GP Holdings L.P.,
the Parent Company, reported a 20.6 percent increase in distributable cash flow
to $78.4 million for the third quarter of 2009 compared to $65.0 million
reported for the third quarter of 2008.
On
October 15, 2009, the Board of Directors of Enterprise GP Holdings’ general
partner approved an increase in the partnership’s quarterly cash distribution
rate to $0.515 per common unit with respect to the third quarter of 2009, which
is a 13.2 percent increase from the $0.455 per common unit that was paid with
respect to the third quarter of 2008. Distributable cash flow
provided 1.1 times coverage of the quarterly cash distribution which was paid
Friday, November 6 to unitholders of record as of the close of business on
October 30, 2009. Distributable cash flow is a non-generally accepted
accounting principle (“non-GAAP”) financial measure that is defined and
reconciled later in this press release to its most directly comparable U.S. GAAP
measure, which is net cash flow provided by operating activities.
The
Parent Company will receive an aggregate $90.7 million of cash distributions
from its investments with respect to the third quarter of 2009. This
represents a 10.2 percent increase from the $82.3 million of cash distributions
it received with respect to the third quarter of 2008. The increase
in cash distributions is primarily due to higher cash distribution rates from
Enterprise Products Partners and Energy Transfer Equity. TEPPCO did
not declare a cash distribution for the third quarter of 2009 since the merger
of TEPPCO with a subsidiary of Enterprise Products Partners was completed before
the record date of the distribution paid by Enterprise Products Partners for the
third quarter of 2009. As a result of the TEPPCO merger, the Parent
Company received approximately 5.5 million Enterprise Products Partners common
units in exchange for the 4.4 million TEPPCO units the partnership owned
immediately prior to the TEPPCO merger. The Parent Company also
received an additional 1.3 million Enterprise Products Partners common units in
exchange for its ownership of Texas Eastern Products Pipeline Company, LLC,
TEPPCO’s general partner, which merged with a wholly owned subsidiary of
Enterprise Products Partners as a condition of the merger.
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(Amounts in millions)
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3rd Qtr
2009
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3rd
Qtr 2008
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||||||
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Enterprise
and TEPPCO (1)
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$ | 69.7 | $ | 63.4 | ||||
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Energy
Transfer Equity & LE GP
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21.0 | 18.9 | ||||||
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Total
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$ | 90.7 | $ | 82.3 | ||||
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(1)
Includes cash distributions from Enterprise Products Partners, TEPPCO and
their respective general partners. See Exhibit A for detailed
information regarding the distributions the Parent Company received (or
expects to receive) from its investments.
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||||||||
Consolidated
net income attributable to Enterprise GP Holdings for the third quarter of 2009
was $25.3 million, or $0.18 per unit on a fully diluted basis, compared to $42.0
million, or $0.34 per unit on a fully diluted basis, for the third quarter of
2008. Net income attributable to Enterprise GP Holdings for the third
quarter of 2009 was negatively impacted by approximately $18.9 million, or $0.14
per unit, for its share of charges related to (i) the Texas Offshore Port System
(“TOPS”) litigation settlement by affiliates of Enterprise Products Partners and
TEPPCO, (ii) asset impairment charges for certain TEPPCO river
1
terminals
and marine barge assets and (iii) a charge for contractual obligations
associated with TEPPCO’s terminal assets.
Parent
Company interest expense for the third quarter of 2009 decreased to $10.1
million from $16.3 million recorded in the third quarter of 2008, primarily due
to lower interest rates.
“We are
pleased to report record distributable cash flow for the sixth consecutive
quarter from increased cash received from Enterprise Products Partners and
Energy Transfer Partners,” said Dr. Ralph S. Cunningham, president and chief
executive officer of Enterprise GP Holdings. “The underlying
businesses of Enterprise Products Partners and TEPPCO are complementary and
combined form a stronger, more diversified partnership. We expect the
merger of the two partnerships will lead to additional commercial opportunities
and an overall lower cost of capital, which should provide us with increased
distributable cash flow.”
Basis of
Presentation of Financial Information
Our
Investment in Enterprise Products Partners business segment reflects the
consolidated operations of Enterprise Products Partners and its general
partner. Our Investment in TEPPCO business segment reflects the
consolidated operations of TEPPCO and its general partner. We control
Enterprise Products Partners through our ownership of its general
partner. As of September 30, 2009, we controlled TEPPCO through our
ownership of its general partner. On October 26, 2009, as a result of
the mergers described above, each of TEPPCO and its general partner became
wholly owned subsidiaries of Enterprise Products Partners.
Our
Investment in Energy Transfer Equity business segment reflects our
noncontrolling interests in Energy Transfer Equity and its general partner
accounted for under the equity method of accounting. We evaluate
segment performance based on operating income.
In order
for the unitholders of Enterprise GP Holdings and others to more fully
understand the Parent Company’s business and financial statements on a
standalone basis, our press release includes information devoted exclusively to
the Parent Company apart from that of our consolidated Partnership. A
key difference between the non-consolidated Parent Company financial information
and those of our consolidated Partnership is that the Parent Company views each
of its investments (i.e., Enterprise Products Partners, TEPPCO and Energy
Transfer Equity) as unconsolidated affiliates and records its share of the net
income of each as equity earnings. In accordance with GAAP, we
eliminate such equity earnings related to Enterprise Products Partners and
TEPPCO in the preparation of our consolidated Partnership financial
statements.
Use of Non-GAAP Financial
Measures
The press
release and accompanying schedules include the non-GAAP financial measure of
distributable cash flow. Exhibit C provides a reconciliation of this
non-GAAP financial measure to its most directly comparable financial measure
calculated in accordance with GAAP. Distributable cash flow should
not be considered an alternative to GAAP financial measures such as net income,
net cash flow provided by operating activities or any other GAAP measure of
liquidity or financial performance. We define distributable cash flow
as follows:
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§
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Cash
distributions expected to be received from the Parent Company’s
investments in limited and general partner interests (including related
incentive distribution rights, if any, held by these general partners);
less the sum of,
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§
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Parent
Company general and administrative costs on a standalone
basis;
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§
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Parent
Company interest expense on a standalone basis, before non-cash
amortization; and
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|
§
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the
general and administrative costs, on a standalone basis, of the general
partners of Enterprise Products Partners and
TEPPCO.
|
2
Distributable
cash flow is a significant liquidity metric used by senior management to compare
net cash flow generated by the Parent Company’s investments to the cash
distributions the Parent Company is expected to pay its
partners. Using this metric, senior management can quickly compute
the coverage ratio of estimated cash flow to planned cash
distributions.
Distributable cash flow is an important
non-GAAP financial measure for the Parent Company’s unitholders since it
indicates to investors whether or not the Parent Company’s investments are
generating cash flow at a level that can sustain or support an increase in
quarterly cash distribution levels. Financial metrics such as
distributable cash flow are quantitative standards used by the investment
community because the value of a partnership unit is in part measured by its
yield (which, in turn, is based on the amount of cash distributions a
partnership pays to a unitholder).
Company Information and
Forward-Looking Statements
Enterprise
GP Holdings L.P. is one of the largest publicly traded GP partnerships and it
owns the general partner and certain limited partner interests in Enterprise
Products Partners L.P., as well as certain noncontrolling general partner and
limited partner interests in Energy Transfer Equity, L.P. For more
information on Enterprise GP Holdings L.P., visit its website at www.enterprisegp.com.
This
press release contains various forward-looking statements and information that
are based on Enterprise GP Holdings’ beliefs and those of its general partner,
as well as assumptions made by and information currently available to Enterprise
GP Holdings. When used in this press release, words such as
“anticipate,” “project,” “expect,” “plan,” “goal,” “forecast,” “intend,”
“could,” “believe,” “may,” and similar expressions and statements regarding the
plans and objectives of Enterprise GP Holdings, Enterprise Products Partners,
Energy Transfer Equity or Energy Transfer Partners (the “Related Companies”) for
future operations, are intended to identify forward-looking
statements. Although Enterprise GP Holdings and its general partner
believe that such expectations reflected in such forward-looking statements are
reasonable, neither Enterprise GP Holdings nor its general partner can give
assurances that such expectations will prove to be correct. Such statements are
subject to a variety of risks, uncertainties and assumptions. If one
or more of these risks or uncertainties materialize, or if underlying
assumptions prove incorrect, Enterprise GP Holdings’ actual results may vary
materially from those it anticipated, estimated, projected or
expected. Among the key risk factors that may have a direct bearing
on the Related Companies’ and, in turn, Enterprise GP Holdings’ results of
operations and financial condition are:
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§
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fluctuations
in oil, natural gas and natural gas liquid prices and production due to
weather and other natural and economic
forces;
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§
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the
effects of the Related Companies’ debt level on its future financial and
operating flexibility;
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§
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a
reduction in demand for the Related Companies’ products by the
petrochemical, refining, heating or other
industries;
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§
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a
decline in the volumes delivered by the Related Companies’
facilities;
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§
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the
failure of any of the Related Companies’ credit risk management efforts to
adequately protect it against customer
non-payment;
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§
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terrorist
attacks aimed at the Related Companies’ facilities;
and
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§
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the
failure to successfully integrate the Related Companies’ operations with
companies, if any, that they may acquire in the
future.
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Enterprise
GP Holdings has no obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.
Contacts:
Randy Burkhalter, Investor Relations (713) 381-6812 or (866)
230-0745
Rick
Rainey, Media Relations (713) 381-3635
###
3
Exhibit
A
Enterprise
GP Holdings L.P. – Parent Company
Selected
Financial Data– UNAUDITED
For
the Three and Nine Months Ended September 30, 2009 and 2008
(Amounts
in millions)
The following table presents
distributable cash flow, summarized income statement data and selected balance
sheet information for the Parent Company with respect to the periods shown and
at the dates indicated:
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Three
Months
Ended
September 30,
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Nine
Months
Ended
September 30,
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|||||||||||||||
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2009
|
2008
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2009
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2008
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|||||||||||||
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Cash distributions from
investees: (1)
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||||||||||||||||
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Enterprise Products Partners
and EPGP: (2)
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||||||||||||||||
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From
common units of Enterprise Products Partners
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$ | 11.5 | $ | 7.0 | $ | 26.3 | $ | 20.8 | ||||||||
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From
2% general partner interest and related IDRs
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58.2 | 37.8 | 143.0 | 109.9 | ||||||||||||
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TEPPCO and TEPPCO GP:
(3,4)
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||||||||||||||||
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From
units of TEPPCO
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n/a | 3.2 | 6.4 | 9.4 | ||||||||||||
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From
2% general partner interest and related IDRs
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n/a | 15.4 | 31.0 | 42.5 | ||||||||||||
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Energy Transfer Equity and LE
GP:
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||||||||||||||||
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From
common units of Energy Transfer Equity
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20.8 | 18.8 | 62.2 | 54.6 | ||||||||||||
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From
member interest in LE GP
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0.2 | 0.1 | 0.4 | 0.3 | ||||||||||||
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Total
cash distributions from investees
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90.7 | 82.3 | 269.3 | 237.5 | ||||||||||||
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Cash
expenses, primarily Parent Company
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(12.3 | ) | (17.3 | ) | (43.4 | ) | (55.4 | ) | ||||||||
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Distributable
cash flow
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$ | 78.4 | $ | 65.0 | $ | 225.9 | $ | 182.1 | ||||||||
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Distributions
by Parent Company
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$ | 71.7 | $ | 56.1 | $ | 208.8 | $ | 162.6 | ||||||||
|
Coverage
ratio
|
1.1x | 1.2x | 1.1x | 1.1x | ||||||||||||
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Parent
Company summarized income statement data:
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||||||||||||||||
|
Equity
in income of investees (5)
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$ | 37.3 | $ | 59.8 | $ | 172.3 | $ | 194.0 | ||||||||
|
General
and administrative costs
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1.9 | 1.5 | 8.7 | 5.3 | ||||||||||||
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Operating
income
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35.4 | 58.3 | 163.6 | 188.7 | ||||||||||||
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Interest
expense, net
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(10.1 | ) | (16.3 | ) | (36.3 | ) | (50.7 | ) | ||||||||
|
Net
income attributable to Enterprise GP Holdings L.P.
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$ | 25.3 | $ | 42.0 | $ | 127.3 | $ | 138.0 | ||||||||
|
Parent
Company debt principal outstanding at end of period
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$ | 1,078.5 | $ | 1,077.0 | $ | 1,078.5 | $ | 1,077.0 | ||||||||
|
(1)
Represents
cash distributions received or, in the case of Energy Transfer Equity
declared and scheduled to be received, with respect to such
quarter. With respect to cash distributions for the third quarter of
2009, we received the distributions shown for Enterprise Products Partners
and its general partner on November 5, 2009. The declared
distribution from Energy Transfer Equity and its general partner for the
third quarter of 2009 is scheduled to be paid on November 19,
2009.
(2)
Cash
distributions from Enterprise Products Partners and EPGP with respect to
the third quarter of 2009 reflect the common units and other consideration
received by the Parent Company in connection the merger of TEPPCO and
TEPPCO GP with Enterprise Products Partners on October 26, 2009 (see notes
3 and 4 below).
(3)
TEPPCO
did not declare a distribution for the third quarter of 2009 as the merger
was completed before the record date; therefore, we did not receive any
distributions from TEPPCO with respect to the third quarter of
2009. The TEPPCO merger was completed on October 26, 2009. Under the
terms of the merger agreement, each of TEPPCO’s unitholders (including the
Parent Company) received 1.24 common units of Enterprise Products Partners
for each TEPPCO unit owned immediately prior to the merger. As a
result, the Parent Company received 5,456,000 common units of Enterprise
Products Partners in exchange for the 4,400,000 TEPPCO units that it owned
immediately prior to the merger. The record date for distributions
paid by Enterprise Products Partners with respect to the third quarter of
2009 was October 30, 2009.
(4)
Immediately
prior to and as a condition to the TEPPCO merger, TEPPCO GP merged with a
wholly owned subsidiary of Enterprise Products Partners (the “GP
merger”). In connection with the GP merger, the Parent Company, as
owner of TEPPCO GP and EPGP, received an additional 1,331,681 common units
of Enterprise Products Partners and an increase in the capital account of
EPGP sufficient to maintain EPGP’s 2% general partner interest in
Enterprise Products Partners.
(5)
Represents
the Parent Company’s share of net income of Enterprise Products Partners,
TEPPCO, Energy Transfer Equity and their respective general
partners.
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||||||||||||||||
4
Exhibit
B
Enterprise
GP Holdings L.P.
Condensed
Statements of Consolidated Operations – UNAUDITED
For
the Three and Nine Months Ended September 30, 2009 and 2008
(Amounts
in millions, except per unit amounts)
At September 30, 2009 and 2008, the
Parent Company owned the general partners of (and therefore controlled)
Enterprise Products Partners and TEPPCO; thus, our consolidated financial
statements include the financial results of Enterprise Products Partners and
TEPPCO. The net income of Enterprise Products Partners and TEPPCO
allocated to limited partner interests not owned by the Parent Company is
allocated to noncontrolling interests. At September 30, 2009 and
2008, we have three reportable business segments: Investment in
Enterprise Products Partners, Investment in TEPPCO and Investment in Energy
Transfer Equity. The following table summarizes our financial
information by business segment for the periods presented:
|
Three
Months
Ended
September 30,
|
Nine
Months
Ended
September 30,
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|||||||||||||||
|
2009
|
2008
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2009
|
2008
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|||||||||||||
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Revenues:
|
||||||||||||||||
|
Investment
in Enterprise Products Partners
|
$ | 4,596.1 | $ | 6,297.9 | $ | 11,527.1 | $ | 18,322.1 | ||||||||
|
Investment
in TEPPCO
|
2,265.4 | 4,264.4 | 5,756.9 | 11,371.8 | ||||||||||||
|
Eliminations
|
(72.3 | ) | (63.1 | ) | (173.5 | ) | (149.8 | ) | ||||||||
|
Total
revenues
|
6,789.2 | 10,499.2 | 17,110.5 | 29,544.1 | ||||||||||||
|
Costs
and expenses:
|
||||||||||||||||
|
Investment
in Enterprise Products Partners (1)
|
4,287.7 | 5,993.7 | 10,582.4 | 17,310.2 | ||||||||||||
|
Investment
in TEPPCO (2)
|
2,232.4 | 4,176.2 | 5,520.9 | 11,083.9 | ||||||||||||
|
Other,
non-segment including Parent Company
|
(70.3 | ) | (61.4 | ) | (164.8 | ) | (140.2 | ) | ||||||||
|
Total
costs and expenses
|
6,449.8 | 10,108.5 | 15,938.5 | 28,253.9 | ||||||||||||
|
Equity
in income (loss) of unconsolidated affiliates:
|
||||||||||||||||
|
Investment
in Enterprise Products Partners (3)
|
16.5 | 9.6 | 34.7 | 31.9 | ||||||||||||
|
Investment
in TEPPCO (3)
|
(1.5 | ) | 0.4 | (2.7 | ) | (0.1 | ) | |||||||||
|
Investment
in Energy Transfer Equity (4)
|
(0.9 | ) | 9.4 | 25.7 | 36.5 | |||||||||||
|
Total
equity in income of unconsolidated affiliates
|
14.1 | 19.4 | 57.7 | 68.3 | ||||||||||||
|
Operating
income:
|
||||||||||||||||
|
Investment
in Enterprise Products Partners
|
324.9 | 313.8 | 979.4 | 1,043.8 | ||||||||||||
|
Investment
in TEPPCO
|
31.5 | 88.6 | 233.3 | 287.8 | ||||||||||||
|
Investment
in Energy Transfer Equity
|
(0.9 | ) | 9.4 | 25.7 | 36.5 | |||||||||||
|
Other,
non-segment including Parent Company
|
(2.0 | ) | (1.7 | ) | (8.7 | ) | (9.6 | ) | ||||||||
|
Total
operating income
|
353.5 | 410.1 | 1,229.7 | 1,358.5 | ||||||||||||
|
Interest
expense
|
(170.9 | ) | (153.3 | ) | (508.2 | ) | (447.2 | ) | ||||||||
|
Provision
for income taxes
|
(7.7 | ) | (7.7 | ) | (26.8 | ) | (20.1 | ) | ||||||||
|
Other
income, net
|
0.1 | 0.5 | 2.2 | 3.4 | ||||||||||||
|
Net
income
|
175.0 | 249.6 | 696.9 | 894.6 | ||||||||||||
|
Net
income attributable to noncontrolling interest (5)
|
(149.7 | ) | (207.6 | ) | (569.6 | ) | (756.6 | ) | ||||||||
|
Net
income attributable to Enterprise GP Holdings L.P.
|
$ | 25.3 | $ | 42.0 | $ | 127.3 | $ | 138.0 | ||||||||
|
Allocation
of net income to:
|
||||||||||||||||
|
Limited
partners
|
$ | 25.3 | $ | 42.0 | $ | 127.3 | $ | 138.0 | ||||||||
|
General
partner
|
$ | * | $ | * | $ | * | $ | * | ||||||||
|
Earnings
per Unit, basic and fully diluted:
|
||||||||||||||||
|
Net
income per Unit
|
$ | 0.18 | $ | 0.34 | $ | 0.93 | $ | 1.12 | ||||||||
|
Average
LP Units outstanding
|
139.2 | 123.2 | 137.4 | 123.2 | ||||||||||||
|
* Amount
is negligible
|
||||||||||||||||
|
(1)
Amounts
for the three and nine months ended September 30, 2009 include $66.9
million and $135.3 million, respectively, of charges related to
TOPS. Prior to the dissociation of our affiliates from TOPS in March
2009, we consolidated TOPS and reported its activities under the
Investment in Enterprise Products Partners segment.
(2)
Amounts
for the three and nine months ended September 30, 2009 include $51.0
million and $53.3 million, respectively, of asset impairment and related
charges recorded by TEPPCO. The asset impairments and related charges
are primarily due to the current level of throughput volumes at certain
river terminals and the suspension by TEPPCO management of three river
terminal expansion projects.
(3)
Represents
equity income (loss) of unconsolidated affiliates as recorded by
Enterprise Products Partners and TEPPCO, excluding those consolidated by
the Parent Company.
(4)
Represents
the Parent Company’s share of the net income of Energy Transfer Equity and
its general partner.
(5)
Represents
earnings of Enterprise Products Partners and TEPPCO allocated to their
respective limited partner interests not owned by the Parent
Company.
|
||||||||||||||||
5
Exhibit
C
Enterprise
GP Holdings L.P. – Parent Company
Non-GAAP
Reconciliations – UNAUDITED
For
the Three and Nine Months Ended September 30, 2009 and 2008
(Amounts
in millions)
The following table presents a
reconciliation of the Parent Company’s non-GAAP distributable cash flow amounts
to GAAP net cash flow provided by operating activities:
|
Three
Months
Ended
September 30,
|
Nine
Months
Ended
September 30,
|
|||||||||||||||
|
2009
|
2008
|
2009
|
2008
|
|||||||||||||
|
Distributable
Cash Flow (Exhibit A)
|
$ | 78.4 | $ | 65.0 | $ | 225.9 | $ | 182.1 | ||||||||
|
Adjustments
to derive net cash flow provided by
|
||||||||||||||||
|
operating
activities (add or subtract as indicated
|
||||||||||||||||
|
by
sign of number):
|
||||||||||||||||
|
Distributions
to be received from investees
|
||||||||||||||||
|
with
respect to period indicated (Exhibit A) (1)
|
(90.7 | ) | (82.3 | ) | (269.3 | ) | (237.5 | ) | ||||||||
|
Distributions
received from investees
|
||||||||||||||||
|
during
period
|
90.3 | 79.1 | 264.6 | 231.2 | ||||||||||||
|
Expenses
of EPGP and TEPPCO GP
|
0.1 | 0.1 | 0.1 | 0.2 | ||||||||||||
|
Net
effect of changes in operating accounts
|
(5.6 | ) | (1.4 | ) | (3.5 | ) | (5.9 | ) | ||||||||
|
Net
cash flow provided by operating activities
|
$ | 72.5 | $ | 60.5 | $ | 217.8 | $ | 170.1 | ||||||||
|
(1)
Represents
cash distributions collected subsequent to the end of each reporting
period.
|
||||||||||||||||
6