Energy Transfer Partners Reports First Quarter Results
Energy Transfer Partners Reports First Quarter Results
DALLAS--(BUSINESS WIRE)-- Energy Transfer Partners, L.P. (NYSE: ETP) today reported its financial results for the quarter ended March 31, 2013.
Adjusted EBITDA for Energy Transfer Partners, L.P. ("ETP" or the "Partnership") for the three months ended March 31, 2013 totaled $956 million, an increase of $462 million compared to the same period last year. Distributable Cash Flow for the three months ended March 31, 2013 totaled $622 million, an increase of $351 million compared to the same period last year. Income from continuing operations for the three months ended March 31, 2013 was $402 million, a decrease of $687 million compared to the same period last year that was primarily due to the recognition of a $1.06 billion gain as a result of the contribution of ETP's Propane Business in January 2012. The increases in Adjusted EBITDA and Distributable Cash Flow were primarily due to strategic acquisitions in 2012, including Sunoco, Inc. ("Sunoco") and ownership interests in Citrus Corp ("Citrus"), Sunoco Logistics Partners L.P. ("Sunoco Logistics"), and ETP Holdco Corporation ("Holdco").
The Partnership's key accomplishments to date in 2013 include the following:
During the first quarter of 2013, Phase I of the Jackson Plant was completed.
On April 30, 2013, the Partnership acquired from Energy Transfer Equity, L.P. ("ETE") its interest in Holdco for approximately 49.5 million newly issued ETP common units and $1.4 billion in cash, less $68 million of estimated closing adjustments.
On April 30, 2013, Southern Union Company ("Southern Union") contributed its interest in Southern Union Gathering Company, LLC to Regency Energy Partners LP ("Regency"), a subsidiary of ETE, in exchange for cash and Regency common units.
On May 6, 2013, the Partnership's subsidiaries, Sunoco Logistics and Lone Star NGL LLC, announced that long-term, fee-based agreements have been executed with an anchor tenant to move forward with a liquefied petroleum gas (LPG) export/import project.
An analysis of the Partnership's segment results and other supplementary data is provided after the financial tables shown below. The Partnership has scheduled a conference call for 8:30 a.m. Central Time, Thursday, May 9, 2013 to discuss the first quarter 2013 results. The conference call will be broadcast live via an internet web cast which can be accessed through www.energytransfer.com and will also be available for replay on the Partnership's website for a limited time.
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 the Partnership'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. A table reconciling Adjusted EBITDA and Distributable Cash Flow with appropriate GAAP financial measures is included in the summarized financial information included in this release. Beginning with the quarter ended December 31, 2012 and applied retroactively to all periods presented, the Partnership has revised its calculation of Adjusted EBITDA and Distributable Cash Flow. (See notes under "Supplemental Information" for further information.)
Energy Transfer Partners, L.P. (NYSE: ETP) is a master limited partnership owning and operating one of the largest and most diversified portfolios of energy assets in the United States. ETP currently has natural gas operations that include approximately 47,000 miles of gathering and transportation pipelines, treating and processing assets, and storage facilities. ETP owns 100% of ETP Holdco Corporation, which owns Southern Union Company and Sunoco, Inc., and a 70% interest in Lone Star NGL LLC, a joint venture that owns and operates natural gas liquids storage, fractionation and transportation assets. ETP also owns the general partner, 100% of the incentive distribution rights, and approximately 33.5 million common units in Sunoco Logistics Partners L.P. (NYS: SXL) , which operates a geographically diverse portfolio of crude oil and refined products pipelines, terminalling and crude oil acquisition and marketing assets. ETP's general partner is owned by ETE. For more information, visit the Energy Transfer Partners, L.P. website at www.energytransfer.com.
Energy Transfer Equity, L.P. (NYS: ETE) is a master limited partnership which owns the general partner and 100% of the incentive distribution rights (IDRs) of Energy Transfer Partners, L.P. (NYS: ETP) and approximately 99.7 million ETP common units; and owns the general partner and 100% of the IDRs of Regency Energy Partners LP (NYS: RGP) and approximately 26.3 million RGP common units. The Energy Transfer family of companies owns more than 71,000 miles of natural gas, natural gas liquids, refined products, and crude pipelines. For more information, visit the Energy Transfer Equity, L.P. website at www.energytransfer.com.
Sunoco Logistics Partners L.P. (NYS: SXL) , headquartered in Philadelphia, is a master limited partnership that owns and operates a logistics business consisting of a geographically diverse portfolio of complementary crude oil and refined product pipeline, terminalling, and acquisition and marketing assets. SXL's general partner is owned by Energy Transfer Partners, L.P. (NYS: ETP) . For more information, visit the Sunoco Logistics Partners, L.P. web site at www.sunocologistics.com.
The information contained in this press release is available on our website at www.energytransfer.com.
ENERGY TRANSFER PARTNERS, L.P. AND SUBSIDIARIES | ||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
(Dollars in millions) | ||||||||
(unaudited) | ||||||||
March 31, | December 31, | |||||||
2013 | 2012 | |||||||
ASSETS | ||||||||
CURRENT ASSETS | $ | 6,359 | $ | 5,404 | ||||
PROPERTY, PLANT AND EQUIPMENT, net | 26,007 | 25,773 | ||||||
NON-CURRENT ASSETS HELD FOR SALE | 992 | 985 | ||||||
ADVANCES TO AND INVESTMENTS IN UNCONSOLIDATED AFFILIATES | 3,489 | 3,502 | ||||||
NON-CURRENT PRICE RISK MANAGEMENT ASSETS | 35 | 42 | ||||||
GOODWILL | 5,586 | 5,606 | ||||||
INTANGIBLE ASSETS, net | 1,544 | 1,561 | ||||||
OTHER NON-CURRENT ASSETS, net | 356 | 357 | ||||||
Total assets | $ | 44,368 | $ | 43,230 | ||||
LIABILITIES AND EQUITY | ||||||||
CURRENT LIABILITIES | $ | 5,783 | $ | 5,548 | ||||
NON-CURRENT LIABILITIES HELD FOR SALE | 142 | 142 | ||||||
LONG-TERM DEBT, less current maturities | 16,135 | 15,442 | ||||||
LONG-TERM NOTES PAYABLE — RELATED PARTY | 166 | 166 | ||||||
NON-CURRENT PRICE RISK MANAGEMENT LIABILITIES | 124 | 129 | ||||||
DEFERRED INCOME TAXES | 3,541 | 3,476 | ||||||
OTHER NON-CURRENT LIABILITIES | 1,008 | 995 | ||||||
COMMITMENTS AND CONTINGENCIES | ||||||||
EQUITY: | ||||||||
Total partners' capital | 9,340 | 9,201 | ||||||
Noncontrolling interest | 8,129 | 8,131 | ||||||
Total equity | 17,469 | 17,332 | ||||||
Total liabilities and equity | $ | 44,368 | $ | 43,230 | ||||
ENERGY TRANSFER PARTNERS, L.P. AND SUBSIDIARIES | ||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||
(Dollars in millions, except per unit data) | ||||||||||
(unaudited) | ||||||||||
Three Months Ended March 31, | ||||||||||
2013 | 2012(1) | |||||||||
REVENUES | $ | 10,854 | $ | 1,323 | ||||||
COSTS AND EXPENSES: | ||||||||||
Cost of products sold | 9,594 | 781 | ||||||||
Operating expenses | 304 | 130 | ||||||||
Depreciation and amortization | 260 | 99 | ||||||||
Selling, general and administrative | 162 | 104 | ||||||||
Total costs and expenses | 10,320 | 1,114 | ||||||||
OPERATING INCOME | 534 | 209 | ||||||||
OTHER INCOME (EXPENSE): | ||||||||||
Interest expense, net of interest capitalized | (211 | ) | (141 | ) | ||||||
Equity in earnings of unconsolidated affiliates | 72 | 55 | ||||||||
Gain on deconsolidation of Propane Business | — | 1,056 | ||||||||
Loss on extinguishment of debt | — | (115 | ) | |||||||
Gains on interest rate derivatives | 7 | 28 | ||||||||
Other, net | 3 | (1 | ) | |||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAX EXPENSE | 405 | 1,091 | ||||||||
Income tax expense from continuing operations | 3 | 2 | ||||||||
INCOME FROM CONTINUING OPERATIONS | 402 | 1,089 | ||||||||
Income (loss) from discontinued operations | 22 | (1 | ) | |||||||
NET INCOME | 424 | 1,088 | ||||||||
LESS: NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTEREST | 102 | (27 | ) | |||||||
NET INCOME ATTRIBUTABLE TO PARTNERS | 322 | 1,115 | ||||||||
GENERAL PARTNER'S INTEREST IN NET INCOME | 128 | 117 | ||||||||
LIMITED PARTNERS' INTEREST IN NET INCOME | $ | 194 | $ | 998 | ||||||
INCOME FROM CONTINUING OPERATIONS PER LIMITED PARTNER UNIT: | ||||||||||
Basic | $ | 0.60 | $ | 4.37 | ||||||
Diluted | $ | 0.60 | $ | 4.36 | ||||||
NET INCOME PER LIMITED PARTNER UNIT: | ||||||||||
Basic | $ | 0.63 | $ | 4.36 | ||||||
Diluted | $ | 0.63 | $ | 4.35 | ||||||
WEIGHTED AVERAGE NUMBER OF UNITS OUTSTANDING: | ||||||||||
Basic | 300,831,573 | 226,549,263 | ||||||||
Diluted | 301,832,910 | 227,406,484 | ||||||||
(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 is retroactively consolidated beginning March 26, 2012, the date that ETE completed its merger with Southern Union. |
SUPPLEMENTAL INFORMATION | ||||||||||
(Dollars in millions) | ||||||||||
(unaudited) | ||||||||||
Three Months Ended March 31, | ||||||||||
2013 | 2012 (b) (c) | |||||||||
Reconciliation of net income to Adjusted EBITDA and Distributable Cash Flow (a): | ||||||||||
Net income | $ | 424 | $ | 1,088 | ||||||
Interest expense, net of interest capitalized | 211 | 141 | ||||||||
Gain on deconsolidation of Propane Business | — | (1,056 | ) | |||||||
Income tax expense | 3 | 2 | ||||||||
Depreciation and amortization | 260 | 99 | ||||||||
Non-cash compensation expense | 14 | 11 | ||||||||
Gains on interest rate derivatives | (7 | ) | (28 | ) | ||||||
Unrealized (gains) losses on commodity risk management activities | (19 | ) | 86 | |||||||
LIFO valuation adjustment | (38 | ) | — | |||||||
Loss on extinguishment of debt | — | 115 | ||||||||
Adjusted EBITDA related to unconsolidated affiliates | 165 | 99 | ||||||||
Equity in earnings of unconsolidated affiliates | (72 | ) | (55 | ) | ||||||
Other, net | 15 | (8 | ) | |||||||
Adjusted EBITDA | 956 | 494 | ||||||||
Adjusted EBITDA related to unconsolidated affiliates | (165 | ) | (99 | ) | ||||||
Distributions from unconsolidated affiliates | 95 | 42 | ||||||||
Interest expense, net of interest capitalized | (211 | ) | (141 | ) | ||||||
Income tax expense | (3 | ) | (2 | ) | ||||||
Maintenance capital expenditures | (51 | ) | (24 | ) | ||||||
Other, net | 1 | 1 | ||||||||
Distributable Cash Flow | $ | 622 | $ | 271 | ||||||
Distributions to be paid to the partners of ETP (d): | ||||||||||
Limited Partners: | ||||||||||
Common units held by ETE | $ | 45 | $ | 45 | ||||||
Common units held by public | 241 | 160 | ||||||||
General Partner interest held by ETE | 5 | 5 | ||||||||
Incentive Distribution Rights ("IDR") held by ETE | 156 | 114 | ||||||||
447 | 324 | |||||||||
IDR relinquishment related to previous acquisitions | (31 | ) | (14 | ) | ||||||
Total distributions to be paid to the partners of ETP | 416 | 310 | ||||||||
Distributions to be paid to noncontrolling interests: | ||||||||||
Distributions to ETE in respect of Holdco (e) | 50 | — | ||||||||
Distributions to Regency in respect of Lone Star (f) | 23 | 11 | ||||||||
Distributions to Sunoco Logistics unitholders (common units held by public) (g) | 40 | — | ||||||||
Total distributions to be paid to noncontrolling interests | 113 | 11 | ||||||||
Total distributions to be paid to the partners of ETP and noncontrolling interests | $ | 529 | $ | 321 | ||||||
(a) | The Partnership has disclosed in this press release Adjusted EBITDA and Distributable Cash Flow, which are non-GAAP financial measures. Management believes Adjusted EBITDA and Distributable Cash Flow provide useful information to investors as measures of comparison with peer companies, including companies that may have different financing and capital structures. The presentation of Adjusted EBITDA and Distributable Cash Flow also allows investors to view our performance in a manner similar to the methods used by management and provides additional insight into our operating results. | |
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. | ||
