Energy Transfer Partners Reports Third Quarter Results
Adjusted EBITDA for
Adjusted EBITDA for ETP for the nine months ended
The increases in Adjusted EBITDA and Distributable Cash Flow were
primarily due to strategic acquisitions in 2012, including
ETP’s key accomplishments during or subsequent to the quarter include the following:
-
ETP’s Board of Directors approved an increase in its quarterly
distribution to
$0.905 per unit ($3.62 annualized) on ETP Common Units for the quarter endedSeptember 30, 2013 , representing an increase of$0.045 per common unit on an annualized basis. -
ETP completed the sale of the assets of Missouri Gas Energy to
Laclede Gas Company , a subsidiary of TheLaclede Group, Inc. , for$975 million . -
The Department of Energy conditionally granted authorization toEnergy Transfer Equity, L.P. (“ETE”),ETP andBG Group to export from the existing Trunkline LNG import terminal up to 15 million metric tonnes per annum of LNG to non-free trade agreement nations. ETE,ETP andBG Group subsequently announced their entry into a project development agreement to jointly develop the LNG export project at the existing Trunkline LNG import terminal inLake Charles, Louisiana . -
ETP and ETE exchanged 50.2 million ETP Common Units, owned by ETE, for
newly issued Class H Units by ETP that track 50.05% of the underlying
economics of the general partner interest and incentive distribution
rights of
Sunoco Logistics . -
ETP andRegency Energy Partners LP (“Regency”) announced thatLone Star NGL LLC (“Lone Star”), a joint venture between ETP and Regency, has placed in service a second natural gas liquids fractionator at its facility inMont Belvieu, Texas , bringing Lone Star’s total fractionation capacity atMont Belvieu to 200,000 barrels per day.
An analysis of ETP’s segment results and other supplementary data is
provided after the financial tables shown below. ETP has scheduled a
conference call for
Forward-Looking Statements
This press release may include certain statements concerning
expectations for the future that are forward-looking statements as
defined by federal law. Such forward-looking statements are subject to a
variety of known and unknown risks, uncertainties, and other factors
that are difficult to predict and many of which are beyond management’s
control. Among those is the risk that the anticipated benefits from the
transaction cannot be fully realized. An extensive list of factors that
can affect future results are discussed in the Partnerships’ Annual
Reports on Form 10-K and other documents filed from time to time with
the
The information contained in this press release is available on our web site at www.energytransfer.com.
ENERGY TRANSFER PARTNERS, L.P. AND SUBSIDIARIES |
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CONDENSED CONSOLIDATED BALANCE SHEETS |
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(In millions) |
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(unaudited) |
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September 30, |
December 31, |
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ASSETS |
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CURRENT ASSETS | $ | 6,582 | $ | 5,404 | ||
PROPERTY, PLANT AND EQUIPMENT, net | 25,090 | 25,773 | ||||
NON-CURRENT ASSETS HELD FOR SALE | 145 | 985 | ||||
ADVANCES TO AND INVESTMENTS IN UNCONSOLIDATED AFFILIATES | 4,513 | 3,502 | ||||
NON-CURRENT PRICE RISK MANAGEMENT ASSETS | 19 | 42 | ||||
GOODWILL | 5,262 | 5,606 | ||||
INTANGIBLE ASSETS, net | 1,490 | 1,561 | ||||
OTHER NON-CURRENT ASSETS, net | 455 | 357 | ||||
Total assets | $ | 43,556 | $ | 43,230 | ||
LIABILITIES AND EQUITY |
||||||
CURRENT LIABILITIES | $ | 5,588 | $ | 5,548 | ||
NON-CURRENT LIABILITIES HELD FOR SALE | 70 | 142 | ||||
LONG-TERM DEBT, less current maturities | 16,352 | 15,442 | ||||
LONG-TERM NOTES PAYABLE — RELATED PARTY | — | 166 | ||||
NON-CURRENT PRICE RISK MANAGEMENT LIABILITIES | 54 | 129 | ||||
DEFERRED INCOME TAXES | 3,605 | 3,476 | ||||
OTHER NON-CURRENT LIABILITIES | 948 | 995 | ||||
COMMITMENTS AND CONTINGENCIES | ||||||
EQUITY: | ||||||
Total partners’ capital | 12,212 | 9,201 | ||||
Noncontrolling interest | 4,727 | 8,131 | ||||
Total equity | 16,939 | 17,332 | ||||
Total liabilities and equity | $ | 43,556 | $ | 43,230 |
ENERGY TRANSFER PARTNERS, L.P. AND SUBSIDIARIES |
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
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(In millions, except per unit data) |
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(unaudited) |
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Three Months Ended |
Nine Months Ended |
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2013 |
2012(1) |
2013 |
2012(1) |
|||||||||||||
REVENUES | $ | 11,902 | $ | 1,802 | $ | 34,307 | $ | 4,721 | ||||||||
COSTS AND EXPENSES: | ||||||||||||||||
Cost of products sold | 10,654 | 1,026 | 30,477 | 2,606 | ||||||||||||
Operating expenses | 331 | 167 | 950 | 493 | ||||||||||||
Depreciation and amortization | 253 | 162 | 764 | 419 | ||||||||||||
Selling, general and administrative | 138 | 82 | 424 | 272 | ||||||||||||
Total costs and expenses | 11,376 | 1,437 | 32,615 | 3,790 | ||||||||||||
OPERATING INCOME | 526 | 365 | 1,692 | 931 | ||||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||||
Interest expense, net of interest capitalized | (210 | ) | (147 | ) | (632 | ) | (479 | ) | ||||||||
Equity in earnings of unconsolidated affiliates | 28 | 8 | 137 | 64 | ||||||||||||
Gain on deconsolidation of Propane Business | — | — | — | 1,057 | ||||||||||||
Gain on sale of AmeriGas common units | 87 | — | 87 | — | ||||||||||||
Loss on extinguishment of debt | — | — | — | (115 | ) | |||||||||||
Gains (losses) on interest rate derivatives | — | — | 46 | (9 | ) | |||||||||||
Other, net | 7 | 7 | 6 | 10 | ||||||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAX EXPENSE | 438 | 233 | 1,336 | 1,459 | ||||||||||||
Income tax expense from continuing operations | 47 | 27 | 139 | 36 | ||||||||||||
INCOME FROM CONTINUING OPERATIONS | 391 | 206 | 1,197 | 1,423 | ||||||||||||
Income (loss) from discontinued operations | 13 | (142 | ) | 44 | (136 | ) | ||||||||||
NET INCOME | 404 | 64 | 1,241 | 1,287 | ||||||||||||
LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST | 49 | 28 | 244 | 25 | ||||||||||||
NET INCOME ATTRIBUTABLE TO PARTNERS | 355 | 36 | 997 | 1,262 | ||||||||||||
GENERAL PARTNER’S INTEREST IN NET INCOME | 146 | 116 | 429 | 342 | ||||||||||||
LIMITED PARTNERS’ INTEREST IN NET INCOME (LOSS) | $ | 209 | $ | (80 | ) | $ | 568 | $ | 920 | |||||||
INCOME FROM CONTINUING OPERATIONS PER LIMITED PARTNER UNIT: | ||||||||||||||||
Basic | $ | 0.51 | $ | 0.26 | $ | 1.55 | $ | 4.54 | ||||||||
Diluted | $ | 0.51 | $ | 0.26 | $ | 1.55 | $ | 4.52 | ||||||||
NET INCOME (LOSS) PER LIMITED PARTNER UNIT: | ||||||||||||||||
Basic | $ | 0.55 | $ | (0.33 | ) | $ | 1.63 | $ | 3.91 | |||||||
Diluted | $ | 0.55 | $ | (0.33 | ) | $ | 1.63 | $ | 3.89 | |||||||
WEIGHTED AVERAGE NUMBER OF UNITS OUTSTANDING: | ||||||||||||||||
Basic | 374.1 | 245.1 | 342.8 | 233.8 | ||||||||||||
Diluted | 375.5 | 246.3 | 344.1 | 235.0 |
(1) |
In accordance with generally accepted accounting principles, amounts previously reported for interim periods in 2012 have been revised to reflect the retrospective consolidation of Southern Union into ETP as a result of the Holdco Transaction as the transfer of Southern Union into Holdco met the definition of a transaction between entities under common control. Thus, Southern Union was retroactively consolidated beginning March 26, 2012, the date that ETE completed its merger with Southern Union. |
SUPPLEMENTAL INFORMATION |
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(Tabular dollar amounts in millions) |
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(unaudited) |
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|
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Three Months Ended |
Nine Months Ended |
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2013 |
2012 (b) (c) |
2013 | 2012 (b) (c) | |||||||||||||
Reconciliation of net income to Adjusted EBITDA and Distributable Cash Flow (a): | ||||||||||||||||
Net income | $ | 404 | $ | 64 | $ | 1,241 | $ | 1,287 | ||||||||
Interest expense, net of interest capitalized | 210 | 147 | 632 | 479 | ||||||||||||
Gain on deconsolidation of Propane Business | — | — | — | (1,057 | ) | |||||||||||
Gain on sale of AmeriGas common units | (87 | ) | — | (87 | ) | — | ||||||||||
Income tax expense from continuing operations | 47 | 27 | 139 | 36 | ||||||||||||
Depreciation and amortization | 253 | 162 | 764 | 419 | ||||||||||||
Non-cash compensation expense | 12 | 10 | 36 | 31 | ||||||||||||
(Gains) losses on interest rate derivatives | — | — | (46 | ) | 9 | |||||||||||
Unrealized (gains) losses on commodity risk management activities | (8 | ) | (11 | ) | (45 | ) | 60 | |||||||||
Write-down of assets included in loss from discontinued operations | — | 145 | — | 145 | ||||||||||||
LIFO valuation adjustment | (6 | ) | — | (22 | ) | — | ||||||||||
Loss on extinguishment of debt | — | — | — | 115 | ||||||||||||
Equity in earnings of unconsolidated affiliates | (28 | ) | (8 | ) | (137 | ) | (64 | ) | ||||||||
Adjusted EBITDA related to unconsolidated affiliates | 151 | 106 | 474 | 302 | ||||||||||||
Other, net | (6 | ) | 18 | 18 | 34 | |||||||||||
Adjusted EBITDA (consolidated) | 942 | 660 | 2,967 | 1,796 | ||||||||||||
Adjusted EBITDA related to unconsolidated affiliates | (151 | ) | (106 | ) | (474 | ) | (302 | ) | ||||||||
Distributions from unconsolidated affiliates | 144 | 81 | 341 | 190 | ||||||||||||
Interest expense, net of interest capitalized | (210 | ) | (147 | ) | (632 | ) | (479 | ) | ||||||||
Income tax expense from continuing operations | (47 | ) | (27 | ) | (139 | ) | (36 | ) | ||||||||
Maintenance capital expenditures | (62 | ) | (69 | ) | (234 | ) | (170 | ) | ||||||||
Other, net | 2 | — | 4 | 1 | ||||||||||||
Distributable Cash Flow (consolidated) | 618 | 392 | 1,833 | 1,000 | ||||||||||||
Distributable Cash Flow attributable to Sunoco Logistics (100%) | (121 | ) | — | (500 | ) | — | ||||||||||
Distributions from Sunoco Logistics to ETP (d) | 53 | — | 147 | — | ||||||||||||
Distributions to ETE in respect of Holdco | — | — | (50 | ) | — | |||||||||||
Distributions to Regency in respect of Lone Star (e) | (23 | ) | (14 | ) | (62 | ) | (46 | ) | ||||||||
Distributable Cash Flow attributable to the partners of ETP | $ | 527 | $ | 378 | $ | 1,368 | $ | 954 | ||||||||
Distributions to the partners of ETP (f): | ||||||||||||||||
Limited Partners: | ||||||||||||||||
Common units held by public | $ | 253 | $ | 224 | $ | 740 | $ | 559 | ||||||||
Common units held by ETE | 45 | 45 | 223 | 135 | ||||||||||||
Class H Units held by ETE Holdings | 16 | — | 16 | — | ||||||||||||
General Partner interests held by ETE | 5 | 5 | 15 | 15 | ||||||||||||
Incentive Distribution Rights (“IDR”) held by ETE | 165 | 147 | 528 | 381 | ||||||||||||
IDR relinquishment related to previous acquisitions | (21 | ) | (31 | ) | (107 | ) | (59 | ) | ||||||||
Total distributions to be paid to the partners of ETP | 463 | 390 | 1,415 | 1,031 | ||||||||||||
Distributions credited to Holdco transactions (g) | — | — | (68 | ) | — | |||||||||||
Net distributions to the partners of ETP | $ | 463 | $ | 390 | $ | 1,347 | $ | 1,031 | ||||||||
Distribution coverage ratio (h) |
1.14 |
x |
0.97 |
x |
1.02 |
x |
0.93 |
x |
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(a) Adjusted EBITDA and Distributable Cash Flow are non-GAAP financial measures used by industry analysts, investors, lenders, and rating agencies to assess the financial performance and the operating results of ETP’s fundamental business activities and should not be considered in isolation or as a substitute for net income, income from operations, cash flows from operating activities, or other GAAP measures.
ETP previously reported Distributable Cash Flow only on a consolidated
basis. Effective
There are material limitations to using measures such as Adjusted EBITDA and Distributable Cash Flow, including the difficulty associated with using either as the sole measure to compare the results of one company to another, and the inability to analyze certain significant items that directly affect a company’s net income or loss or cash flows. In addition, our calculations of Adjusted EBITDA and Distributable Cash Flow may not be consistent with similarly titled measures of other companies and should be viewed in conjunction with measurements that are computed in accordance with GAAP, such as gross margin, operating income, net income, and cash flow from operating activities.
Definition of Adjusted EBITDA
ETP defines Adjusted EBITDA as total partnership earnings before interest, taxes, depreciation, amortization and other non-cash items, such as non-cash compensation expense, gains and losses on disposals of assets, the allowance for equity funds used during construction, unrealized gains and losses on commodity risk management activities, non-cash impairment charges, loss on extinguishment of debt, gain on deconsolidation of our Propane Business and other non-operating income or expense items. Unrealized gains and losses on commodity risk management activities include unrealized gains and losses on commodity derivatives and inventory fair value adjustments (excluding lower of cost or market adjustments). Adjusted EBITDA reflects amounts for less than wholly-owned subsidiaries based on 100% of the subsidiaries’ results of operations and for unconsolidated affiliates based on ETP’s proportionate ownership.
Adjusted EBITDA is used by management to determine our operating performance and, along with other financial and volumetric data, as internal measures for setting annual operating budgets, assessing financial performance of our numerous business locations, as a measure for evaluating targeted businesses for acquisition and as a measurement component of incentive compensation.
Definition of Distributable Cash Flow
ETP defines Distributable Cash Flow as net income, adjusted for certain non-cash items, less maintenance capital expenditures. Non-cash items include depreciation and amortization, non-cash compensation expense, gains and losses on disposals of assets, the allowance for equity funds used during construction, unrealized gains and losses on commodity risk management activities, non-cash impairment charges, loss on extinguishment of debt and gain on deconsolidation of our Propane Business. Unrealized gains and losses on commodity risk management activities includes unrealized gains and losses on commodity derivatives and inventory fair value adjustments (excluding lower of cost or market adjustments). Distributable Cash Flow reflects earnings from unconsolidated affiliates on a cash basis.
Distributable Cash Flow is used by management to evaluate our overall performance. Our partnership agreement requires us to distribute all available cash, and Distributable Cash Flow is calculated to evaluate our ability to fund distributions through cash generated by our operations.
On a consolidated basis, Distributable Cash Flow includes 100% of the Distributable Cash Flow of ETP's consolidated subsidiaries. However, to the extent that noncontrolling interests exist among ETP's subsidiaries, the Distributable Cash Flow generated by ETP's subsidiaries may not be available to be distributed to the partners of ETP. In order to reflect the cash flows available for distributions to the partners of ETP, ETP has reported Distributable Cash Flow attributable to the partners of ETP, which is calculated by adjusting Distributable Cash Flow (consolidated), as follows:
-
For subsidiaries with publicly traded equity interests, Distributable
Cash Flow (consolidated) includes 100% of Distributable Cash Flow
attributable to such subsidiary, and Distributable Cash Flow
attributable to the partners of ETP includes distributions to be
received by the parent company with respect to the periods presented.
Currently,
Sunoco Logistics is the only such subsidiary. -
For consolidated joint ventures or similar entities, where the
noncontrolling interest is not publicly traded, Distributable Cash
Flow (consolidated) includes 100% of Distributable Cash Flow
attributable to such subsidiary, but Distributable Cash Flow
attributable to the partners of ETP is net of distributions to be paid
by the subsidiary to the noncontrolling interests. Currently,
Lone Star is such a subsidiary, as it is 30% owned by Regency, which is an unconsolidated affiliate. Prior toApril 30, 2013 , Holdco was also such a subsidiary, as ETE held a noncontrolling interest in Holdco.
(b) In accordance with generally accepted accounting principles, amounts
previously reported for interim periods in 2012 have been revised to
reflect the retrospective consolidation of
(c) ETP has presented Adjusted EBITDA and Distributable Cash Flow
(consolidated) in previous communications; however, ETP changed its
definition for these non-GAAP measures in the quarter ended
(d) For the three months ended September 30, 2013, cash distributions to
be paid from
For the nine months ended September 30, 2013, cash distributions to be
paid from
(e) Cash distributions to Regency in respect of
(f) For the three months ended September 30, 2013, cash distributions to
be paid to the partners of ETP consist of cash distributions payable on
For the nine months ended September 30, 2013, cash distributions to be
paid to the partners of ETP consist of cash distributions paid on
May 15, 2013 in respect of the quarter ended March 31, 2013, cash
distributions paid on
(g) For the nine months ended September 30, 2013, net distributions to
the partners of ETP excluded distributions paid in respect of the
quarter ended March 31, 2013 on 49.5 million ETP Common Units issued to
ETE as a portion of the consideration for ETP's acquisition of ETE's
interest in Holdco on
(h) Distribution coverage ratio is calculated as Distributable Cash Flow attributable to the partners of ETP divided by net distributions to the partners of ETP.
SUMMARY ANALYSIS OF QUARTERLY RESULTS BY SEGMENT |
(Tabular amounts in millions) |
(unaudited) |
Our segment results were presented based on the measure of Segment Adjusted EBITDA. The tables below identify the components of Segment Adjusted EBITDA, which was calculated as follows:
- Gross margin, operating expenses, and selling, general and administrative. These amounts represent the amounts included in our consolidated financial statements that are attributable to each segment.
- Unrealized gains or losses on commodity risk management activities. These are the unrealized amounts that are included in cost of products sold to calculate gross margin. These amounts are not included in Segment Adjusted EBITDA; therefore, the unrealized losses are added back and the unrealized gains are subtracted to calculate the segment measure.
- Non-cash compensation expense. These amounts represent the total non-cash compensation recorded in operating expenses and selling, general and administrative. This expense is not included in Segment Adjusted EBITDA and therefore is added back to calculate the segment measure.
- Adjusted EBITDA related to unconsolidated affiliates. These amounts represent our proportionate share of the Adjusted EBITDA of our unconsolidated affiliates. Amounts reflected are calculated consistently with our definition of Adjusted EBITDA above.
Three Months Ended |
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2013 | 2012 | |||||||
Segment Adjusted EBITDA: | ||||||||
Intrastate transportation and storage | $ | 108 | $ | 121 | ||||
Interstate transportation and storage | 310 | 324 | ||||||
Midstream | 125 | 134 | ||||||
NGL transportation and services | 100 | 50 | ||||||
Investment in Sunoco Logistics | 181 | — | ||||||
Retail marketing | 100 | — | ||||||
All other | 18 | 31 | ||||||
$ | 942 | $ | 660 | |||||
Intrastate Transportation and Storage |
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|
Three Months Ended |
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2013 | 2012 | |||||||
Natural gas transported (MMBtu/d) | 9,438,372 | 9,942,575 | ||||||
Revenues | $ | 553 | $ | 556 | ||||
Cost of products sold | 385 | 362 | ||||||
Gross margin | 168 | 194 | ||||||
Unrealized gains on commodity risk management activities | (6 | ) | (13 | ) | ||||
Operating expenses, excluding non-cash compensation expense | (45 | ) | (45 | ) | ||||
Selling, general and administrative expenses, excluding non-cash compensation expense | (9 | ) | (13 | ) | ||||
Adjusted EBITDA related to unconsolidated affiliates | — | (2 | ) | |||||
Segment Adjusted EBITDA | $ | 108 | $ | 121 | ||||
Distributions from unconsolidated affiliates | $ | 2 | $ | 2 | ||||
Segment Adjusted EBITDA for the intrastate transportation and storage
segment decreased for the three months ended September 30, 2013 compared
to the same period last year primarily due to a
Interstate Transportation and Storage
Three Months Ended |
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2013 | 2012 | |||||||
Natural gas transported (MMBtu/d) | 6,081,246 | 6,637,914 | ||||||
Natural gas sold (MMBtu/d) | 22,467 | 16,976 | ||||||
Revenues | $ | 311 | $ | 321 | ||||
Operating expenses, excluding non-cash compensation, amortization and accretion expenses | (83 | ) | (58 | ) | ||||
Selling, general and administrative expenses, excluding non-cash compensation, amortization and accretion expenses | (23 | ) | (40 | ) | ||||
Adjusted EBITDA related to unconsolidated affiliates | 105 | 101 | ||||||
Segment Adjusted EBITDA | $ | 310 | $ | 324 | ||||
Distributions from unconsolidated affiliates | $ | 65 | $ | 56 | ||||
Segment Adjusted EBITDA for the interstate transportation and storage
segment decreased for the three months ended September 30, 2013 compared
to the same period last year primarily due to a
Midstream
Three Months Ended |
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2013 | 2012 | |||||||
Gathered volumes (MMBtu/d): | ||||||||
ETP legacy assets | 2,745,362 | 2,463,987 | ||||||
Southern Union gathering and processing | — | 434,452 | ||||||
NGLs produced (Bbls/d): | ||||||||
ETP legacy assets | 114,968 | 83,736 | ||||||
Southern Union gathering and processing | — | 32,276 | ||||||
Equity NGLs produced (Bbls/d): | ||||||||
ETP legacy assets | 11,777 | 15,890 | ||||||
Southern Union gathering and processing | — | 7,502 | ||||||
Revenues | $ | 939 | $ | 864 | ||||
Cost of products sold | 777 | 682 | ||||||
Gross margin | 162 | 182 | ||||||
Unrealized (gains) losses on commodity risk management activities | (1 | ) | 1 | |||||
Operating expenses, excluding non-cash compensation expense | (29 | ) | (37 | ) | ||||
Selling, general and administrative expenses, excluding non-cash compensation expense | (7 | ) | (16 | ) | ||||
Adjusted EBITDA attributable to discontinued operations | — | 5 | ||||||
Adjusted EBITDA related to unconsolidated affiliates | — | (1 | ) | |||||
Segment Adjusted EBITDA | $ | 125 | $ | 134 | ||||
Segment Adjusted EBITDA for midstream decreased for the three months
ended September 30, 2013 compared to the same period last year primarily
due to a
Segment Adjusted EBITDA for the midstream segment reflected a decrease in gross margin as follows:
Three Months Ended |
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2013 | 2012 | |||||||
Gathering and processing fee-based revenues | $ | 116 | $ | 89 | ||||
Non fee-based contracts and processing | 52 | 100 | ||||||
Other | (6 | ) | (7 | ) | ||||
Total gross margin | $ | 162 | $ | 182 | ||||
Midstream gross margin for the three months ended September 30, 2013
compared to the same period last year reflected increases in fee-based
revenues of
NGL Transportation and Services
Three Months Ended |
||||||||
2013 | 2012 | |||||||
NGL transportation volumes (Bbls/d) | 340,483 | 174,234 | ||||||
NGL fractionation volumes (Bbls/d) | 96,608 | 11,442 | ||||||
Revenues | $ | 548 | $ | 168 | ||||
Cost of products sold | 426 | 101 | ||||||
Gross margin | 122 | 67 | ||||||
Unrealized losses on commodity risk management activities | 1 | — | ||||||
Operating expenses, excluding non-cash compensation expense | (19 | ) | (13 | ) | ||||
Selling, general and administrative expenses, excluding non-cash compensation expense | (6 | ) | (5 | ) | ||||
Adjusted EBITDA related to unconsolidated affiliates | 2 | 1 | ||||||
Segment Adjusted EBITDA | $ | 100 | $ | 50 | ||||
Distributions from unconsolidated affiliates | $ | 1 | $ | — | ||||
Segment Adjusted EBITDA for the NGL transportation and services segment increased for the three months ended September 30, 2013 compared to the same period last year primarily due to higher gross margin, as discussed below, partially offset by higher operating expenses from new assets placed in service.
Segment Adjusted EBITDA for the NGL transportation and services segment reflected an increase in gross margin as follows:
Three Months Ended |
|||||||
2013 | 2012 | ||||||
Storage margin | $ | 33 | $ | 35 | |||
Transportation margin | 49 | 21 | |||||
Processing and fractionation margin | 38 | 12 | |||||
Other margin | 2 | (1 | ) | ||||
Total gross margin | $ | 122 | $ | 67 | |||
Transportation margin increased as a result of higher volumes
transported due to the completion of the Gateway pipeline resulting in
increased margin of
Processing and fractionation margin primarily increased due to the
startup of Lone Star’s fractionator at
Investment in
Three Months Ended |
|||||||
2013 | 2012 | ||||||
Revenue | $ | 4,528 | $ | — | |||
Cost of products sold | 4,287 | — | |||||
Gross margin | 241 | — | |||||
Unrealized gains on commodity risk management activities | (8 | ) | — | ||||
Operating expenses, excluding non-cash compensation expense | (36 | ) | — | ||||
Selling, general and administrative expenses, excluding non-cash compensation expense | (29 | ) | — | ||||
Adjusted EBITDA related to unconsolidated affiliates | 13 | — | |||||
Segment Adjusted EBITDA | $ | 181 | $ | — | |||
Distributions from unconsolidated affiliates | $ | 3 | $ | — | |||
We obtained control of
Retail Marketing
Three Months Ended |
|||||||
2013 | 2012 | ||||||
Total retail gasoline outlets, end of period | 4,972 | — | |||||
Total company-operated outlets, end of period | 443 | — | |||||
Gasoline and diesel throughput per company-operated site (gallons/month) | 202,500 | — | |||||
Revenue | $ | 5,298 | $ | — | |||
Cost of products sold | 5,066 | — | |||||
Gross margin | 232 | — | |||||
Unrealized losses on commodity risk management activities | 1 | — | |||||
Operating expenses, excluding non-cash compensation expense | (103 | ) | — | ||||
Selling, general and administrative expenses, excluding non-cash compensation expense | (25 | ) | — | ||||
LIFO valuation adjustment | (6 | ) | — | ||||
Adjusted EBITDA related to unconsolidated affiliates | 1 | — | |||||
Segment Adjusted EBITDA | $ | 100 | $ | — | |||
We acquired our retail marketing segment on
All Other
Three Months Ended |
||||||||
2013 | 2012 | |||||||
Revenue | $ | 95 | $ | 104 | ||||
Cost of products sold | 87 | 85 | ||||||
Gross margin | 8 | 19 | ||||||
Unrealized losses on commodity risk management activities | 5 | 1 | ||||||
Operating expenses, excluding non-cash compensation expense | (11 | ) | (18 | ) | ||||
Selling, general and administrative expenses, excluding non-cash compensation expense | (26 | ) | 3 | |||||
Adjusted EBITDA attributable to discontinued operations | 12 | 27 | ||||||
Adjusted EBITDA related to unconsolidated affiliates | 31 | 3 | ||||||
Elimination | (1 | ) | (4 | ) | ||||
Segment Adjusted EBITDA | $ | 18 | $ | 31 | ||||
Distributions from unconsolidated affiliates | $ | 73 | $ | 23 | ||||
Amounts reflected above primarily include:
-
our investment in
AmeriGas ; - our natural gas compression operations;
-
an approximate 30% non-operating interest in PES, a refining joint
venture, effective upon our acquisition of Sunoco on
October 5, 2012 ; and, -
our investment in Regency related to the Regency common and Class F
units received by
Southern Union in exchange for the contribution of its interest inSouthern Union Gathering Company, LLC to Regency onApril 30, 2013 .
Adjusted EBITDA attributable to discontinued operations reflected the
results of
Adjusted EBITDA related to unconsolidated affiliates reflected the
results from our investments in
The increase in distributions from unconsolidated affiliates was
primarily due to cash distributions from our ownership in Regency and
PES of
SUPPLEMENTAL INFORMATION ON CAPITAL EXPENDITURES |
(Tabular amounts in millions) |
(unaudited) |
The following is a summary of capital expenditures recorded during the
nine months ended
Growth | Maintenance | Total | |||||||
Intrastate transportation and storage | $ | 1 | $ | 22 | $ | 23 | |||
Interstate transportation and storage | 37 | 48 | 85 | ||||||
Midstream(1) | 412 | 36 | 448 | ||||||
NGL transportation and services(2) | 342 | 12 | 354 | ||||||
Investment in Sunoco Logistics | 598 | 37 | 635 | ||||||
Retail marketing | 41 | 47 | 88 | ||||||
All other (including eliminations) | 12 | 32 | 44 | ||||||
Total capital expenditures | $ | 1,443 | $ | 234 | $ | 1,677 | |||
(1) Amounts reflected above for the midstream segment include
growth and maintenance capital expenditures of
(2) We received
We currently expect capital expenditures for the full year 2013 to be within the following ranges:
Growth | Maintenance | |||||||||||
Low | High | Low | High | |||||||||
Intrastate transportation and storage | $ | 5 | $ | 5 | $ | 25 | $ | 30 | ||||
Interstate transportation and storage | 40 | 50 | 75 | 90 | ||||||||
Midstream(1) | 455 | 475 | 40 | 45 | ||||||||
NGL transportation and services(2) | 420 | 425 | 15 | 20 | ||||||||
Investment in Sunoco Logistics | 880 | 920 | 60 | 65 | ||||||||
Retail marketing | 65 | 75 | 65 | 75 | ||||||||
All other (including eliminations) | 20 | 25 | 40 | 45 | ||||||||
Total capital expenditures | $ | 1,885 | $ | 1,975 | $ | 320 | $ | 370 | ||||
(1) Amounts reflected above for the midstream segment include
growth and maintenance capital expenditures of
(2) We expect to receive
SUPPLEMENTAL INFORMATION ON UNCONSOLIDATED AFFILIATES |
||||||||
(In millions) |
||||||||
(unaudited) |
||||||||
|
||||||||
Three Months Ended |
||||||||
2013 | 2012 | |||||||
Equity in earnings (losses) of unconsolidated affiliates: | ||||||||
AmeriGas | $ | (19 | ) | $ | (32 | ) | ||
Citrus | 28 | 25 | ||||||
FEP | 14 | 15 | ||||||
Regency | 8 | — | ||||||
Other | (3 | ) | — | |||||
Total equity in earnings of unconsolidated affiliates | $ | 28 | $ | 8 | ||||
Proportionate share of interest, depreciation, amortization, non-cash compensation expense, loss on debt extinguishment and taxes: | ||||||||
AmeriGas | $ | 28 | $ | 36 | ||||
Citrus | 57 | 56 | ||||||
FEP | 6 | 5 | ||||||
Regency | 18 | — | ||||||
Other | 14 | 1 | ||||||
Total proportionate share of interest, depreciation, amortization, non-cash compensation expense, loss on debt extinguishment and taxes | $ | 123 | $ | 98 | ||||
Adjusted EBITDA related to unconsolidated affiliates: | ||||||||
AmeriGas | $ | 9 | $ | 4 | ||||
Citrus | 85 | 81 | ||||||
FEP | 20 | 20 | ||||||
Regency | 26 | — | ||||||
Other | 11 | 1 | ||||||
Total Adjusted EBITDA related to unconsolidated affiliates | $ | 151 | $ | 106 | ||||
Distributions received from unconsolidated affiliates: | ||||||||
AmeriGas | $ | 19 | $ | 24 | ||||
Citrus | 47 | 38 | ||||||
FEP | 18 | 18 | ||||||
Regency | 14 | — | ||||||
Other | 46 | 1 | ||||||
Total distributions received from unconsolidated affiliates | $ | 144 | $ | 81 |
Source:
Investor Relations:
Energy Transfer
Brent Ratliff,
214-981-0700
or
Media Relations:
Granado
Communications Group
Vicki Granado, 214-599-8785
214-498-9272
(cell)