August 8, 2017 | ||
Date of Report (Date of earliest event reported) | ||
ENERGY TRANSFER PARTNERS, L.P. | ||
(Exact name of Registrant as specified in its charter) | ||
Delaware | 1-31219 | 73-1493906 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
8111 Westchester Drive, Suite 600, Dallas, Texas 75225 |
(Address of principal executive offices) (Zip Code) |
(214) 981-0700 |
(Registrant’s telephone number, including area code) |
¨ | 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)) |
Exhibit Number | Description of the Exhibit | |
99.1 | Energy Transfer Partners, L.P. Press Release dated August 8, 2017 |
ENERGY TRANSFER PARTNERS, L.P. | |||
By: | Energy Transfer Partners GP, L.P. | ||
its General Partner | |||
By: | Energy Transfer Partners, L.L.C. | ||
its General Partner | |||
Date: | August 8, 2017 | By: | /s/ Thomas E. Long |
Thomas E. Long | |||
Chief Financial Officer |
Exhibit Number | Description of the Exhibit | |
99.1 | Energy Transfer Partners, L.P. Press Release dated August 8, 2017 |
• | References to “ETLP” refer to Energy Transfer, LP subsequent to the close of the merger; |
• | References to “Sunoco Logistics” refer to the entity named Sunoco Logistics Partners L.P. prior to the close of the merger; and |
• | References to “ETP” refer to the consolidated entity named Energy Transfer Partners, L.P. subsequent to the close of the merger. |
June 30, 2017 | December 31, 2016 (a) | ||||||
ASSETS | |||||||
Current assets | $ | 5,386 | $ | 5,729 | |||
Property, plant and equipment, net | 54,536 | 50,917 | |||||
Advances to and investments in unconsolidated affiliates | 4,228 | 4,280 | |||||
Other non-current assets, net | 707 | 672 | |||||
Intangible assets, net | 5,443 | 4,696 | |||||
Goodwill | 3,919 | 3,897 | |||||
Total assets | $ | 74,219 | $ | 70,191 |
LIABILITIES AND EQUITY | |||||||
Current liabilities | $ | 6,989 | $ | 6,203 | |||
Long-term debt, less current maturities | 32,029 | 31,741 | |||||
Long-term notes payable – related company | — | 250 | |||||
Non-current derivative liabilities | 201 | 76 | |||||
Deferred income taxes | 4,498 | 4,394 | |||||
Other non-current liabilities | 1,066 | 952 | |||||
Commitments and contingencies | |||||||
Series A Preferred Units | — | 33 | |||||
Redeemable noncontrolling interests | 21 | 15 | |||||
Equity: | |||||||
Total partners’ capital | 25,616 | 18,642 | |||||
Noncontrolling interest | 3,799 | 7,885 | |||||
Total equity | 29,415 | 26,527 | |||||
Total liabilities and equity | $ | 74,219 | $ | 70,191 |
(a) | The Sunoco Logistics Merger resulted in Energy Transfer Partners, L.P. being treated as the surviving consolidated entity from an accounting perspective, while Sunoco Logistics (prior to changing its name to “Energy Transfer Partners, L.P.”) was the surviving consolidated entity from a legal and reporting perspective. Therefore, for the pre-merger periods, the consolidated financial statements reflect the consolidated financial statements of the legal acquiree (i.e., the entity that was named “Energy Transfer Partners, L.P.” prior to the merger and name changes). |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2017 | 2016 (a) | 2017 (a) | 2016 (a) | ||||||||||||
REVENUES | $ | 6,576 | $ | 5,289 | $ | 13,471 | $ | 9,770 | |||||||
COSTS AND EXPENSES: | |||||||||||||||
Cost of products sold | 4,742 | 3,630 | 9,934 | 6,598 | |||||||||||
Operating expenses | 425 | 374 | 804 | 722 | |||||||||||
Depreciation, depletion and amortization | 557 | 496 | 1,117 | 966 | |||||||||||
Selling, general and administrative | 120 | 74 | 230 | 155 | |||||||||||
Total costs and expenses | 5,844 | 4,574 | 12,085 | 8,441 | |||||||||||
OPERATING INCOME | 732 | 715 | 1,386 | 1,329 | |||||||||||
OTHER INCOME (EXPENSE): | |||||||||||||||
Interest expense, net | (346 | ) | (317 | ) | (685 | ) | (636 | ) | |||||||
Equity in earnings (losses) of unconsolidated affiliates | (61 | ) | 119 | 12 | 195 | ||||||||||
Losses on interest rate derivatives | (25 | ) | (81 | ) | (20 | ) | (151 | ) | |||||||
Other, net | 71 | 27 | 97 | 44 | |||||||||||
INCOME BEFORE INCOME TAX EXPENSE (BENEFIT) | 371 | 463 | 790 | 781 | |||||||||||
Income tax expense (benefit) | 79 | (9 | ) | 134 | (67 | ) | |||||||||
NET INCOME | 292 | 472 | 656 | 848 | |||||||||||
Less: Net income attributable to noncontrolling interest | 93 | 102 | 133 | 167 | |||||||||||
NET INCOME ATTRIBUTABLE TO PARTNERS | 199 | 370 | 523 | 681 | |||||||||||
General Partner’s interest in net income | 251 | 223 | 457 | 520 | |||||||||||
Class H Unitholder’s interest in net income | — | 85 | 98 | 164 | |||||||||||
Class I Unitholder’s interest in net income | — | 2 | — | 4 | |||||||||||
Common Unitholders’ interest in net income (loss) | $ | (52 | ) | $ | 60 | $ | (32 | ) | $ | (7 | ) | ||||
NET INCOME (LOSS) PER COMMON UNIT: (b) | |||||||||||||||
Basic | $ | (0.04 | ) | $ | 0.07 | $ | (0.04 | ) | $ | (0.03 | ) | ||||
Diluted | $ | (0.04 | ) | $ | 0.06 | $ | (0.04 | ) | $ | (0.03 | ) | ||||
WEIGHTED AVERAGE NUMBER OF COMMON UNITS OUTSTANDING: (b) | |||||||||||||||
Basic | 1,021.7 | 752.4 | 922.5 | 743.9 | |||||||||||
Diluted | 1,021.7 | 753.9 | 922.5 | 744.4 |
(a) | See note (a) to the condensed consolidated balance sheets. |
(b) | The historical common units and net income (loss) per limited partner unit amounts presented in these consolidated financial statements have been retrospectively adjusted to reflect the 1.5 to one unit-for-unit exchange in connection with the Sunoco Logistics Merger. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2017 (a) | 2016 (a) | 2017 (a) | 2016 (a) | ||||||||||||
Reconciliation of net income to Adjusted EBITDA and Distributable Cash Flow (b): | |||||||||||||||
Net income | $ | 292 | $ | 472 | $ | 656 | $ | 848 | |||||||
Interest expense, net | 346 | 317 | 685 | 636 | |||||||||||
Income tax expense (benefit) | 79 | (9 | ) | 134 | (67 | ) | |||||||||
Depreciation, depletion and amortization | 557 | 496 | 1,117 | 966 | |||||||||||
Non-cash unit-based compensation expense | 15 | 19 | 38 | 38 | |||||||||||
Losses on interest rate derivatives | 25 | 81 | 20 | 151 | |||||||||||
Unrealized gains (losses) on commodity risk management activities | (34 | ) | 18 | (98 | ) | 81 | |||||||||
Inventory valuation adjustments | 58 | (132 | ) | 56 | (106 | ) | |||||||||
Equity in earnings (losses) of unconsolidated affiliates | 61 | (119 | ) | (12 | ) | (195 | ) | ||||||||
Adjusted EBITDA related to unconsolidated affiliates | 247 | 252 | 486 | 471 | |||||||||||
Other, net | (47 | ) | (25 | ) | (69 | ) | (41 | ) | |||||||
Adjusted EBITDA (consolidated) | 1,599 | 1,370 | 3,013 | 2,782 | |||||||||||
Adjusted EBITDA related to unconsolidated affiliates | (247 | ) | (252 | ) | (486 | ) | (471 | ) | |||||||
Distributable cash flow from unconsolidated affiliates | 123 | 116 | 267 | 260 | |||||||||||
Interest expense, net | (346 | ) | (317 | ) | (685 | ) | (636 | ) | |||||||
Amortization included in interest expense | (2 | ) | (5 | ) | (3 | ) | (12 | ) | |||||||
Current income tax expense | (12 | ) | (13 | ) | (13 | ) | (12 | ) | |||||||
Maintenance capital expenditures | (107 | ) | (78 | ) | (167 | ) | (137 | ) | |||||||
Other, net | 14 | 3 | 30 | 6 | |||||||||||
Distributable Cash Flow (consolidated) | 1,022 | 824 | 1,956 | 1,780 | |||||||||||
Distributable Cash Flow attributable to PennTex Midstream Partners, LP (“PennTex”) (100%) (c) | — | — | (19 | ) | — | ||||||||||
Distributions from PennTex to ETP (c) | — | — | 8 | — | |||||||||||
Distributable cash flow attributable to noncontrolling interest in other consolidated subsidiaries | (57 | ) | (9 | ) | (80 | ) | (17 | ) | |||||||
Distributable Cash Flow attributable to the partners of ETP | 965 | 815 | 1,865 | 1,763 | |||||||||||
Transaction-related expenses | 25 | — | 32 | 2 | |||||||||||
Distributable Cash Flow attributable to the partners of ETP, as adjusted | $ | 990 | $ | 815 | $ | 1,897 | $ | 1,765 | |||||||
Distributions to partners (d): | |||||||||||||||
Limited Partners: | |||||||||||||||
Common Units held by public | $ | 589 | $ | 492 | $ | 1,156 | $ | 965 | |||||||
Common Units held by parent | 15 | 2 | 30 | 4 | |||||||||||
Class H Units held by ETE | — | — | — | — | |||||||||||
General Partner interests | 4 | 4 | 8 | 7 | |||||||||||
Incentive Distribution Rights (“IDRs”) held by parent | 396 | 319 | 773 | 622 | |||||||||||
IDR relinquishments | (162 | ) | (109 | ) | (319 | ) | (143 | ) | |||||||
Total distributions to be paid to partners | $ | 842 | $ | 708 | $ | 1,648 | $ | 1,455 | |||||||
Common Units outstanding – end of period (d)(e) | 1,092.6 | 981.5 | 1,092.6 | 981.5 | |||||||||||
Distribution coverage ratio (f) | 1.18x | 1.15x | 1.15x | 1.21x |
(a) | For the three and six months ended June 30, 2017 and 2016, the calculation of Distributable Cash Flow and the amounts reflected for distributions to partners and common units outstanding reflect the pro forma impacts of the Sunoco Logistics Merger as though the merger had occurred on January 1, 2016. As a result, the prior period amounts reported above differ from information previously reported by legacy ETP, as follows: |
• | Distributable cash flow attributable to the partners of ETP includes amounts attributable to the partners of both legacy ETP and legacy Sunoco Logistics. Previously, the calculation of distributable cash flow attributable to the partners of ETP (as previously reported by legacy ETP) excluded the distributable cash flow attributable to Sunoco Logistics and only included distributions from legacy Sunoco Logistics to legacy ETP. |
• | Distributable cash flow attributable to noncontrolling interest in other consolidated subsidiaries includes amounts attributable to the noncontrolling interests in the other consolidated subsidiaries of both legacy ETP and legacy Sunoco Logistics. |
• | The transaction-related expenses adjustment in distributable cash flow attributable to the partners of ETP, as adjusted, includes amounts incurred by both legacy ETP and legacy Sunoco Logistics. |
• | Distributions to limited partners include distributions paid on the common units of both legacy ETP and legacy Sunoco Logistics but exclude the following distributions in the prior periods on units that were cancelled in the merger, which comprise the following: (i) distributions paid by legacy Sunoco Logistics on its common units held legacy ETP and (ii) distributions paid by legacy ETP on its Class H units held by ETE. |
• | Distributions on General Partner interests and incentive distribution rights are reflected on a pro forma basis, based on the pro forma cash distributions to limited partners and the current distribution waterfall per the limited partnership agreement (i.e., the legacy Sunoco Logistics distribution waterfall). |
• | Common units outstanding for the pre-merger periods reflect (i) the legacy ETP common units outstanding at the end of the period multiplied by a factor of 1.5x and (ii) the legacy Sunoco Logistics common units outstanding at the end of the period minus 67.1 million legacy Sunoco Logistics common units held by ETP, which were cancelled in connection with the closing of the merger. |
(b) | 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. |
• | 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 our partners includes distributions to be received by the parent company with respect to the periods presented. |
• | 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 partners is net of distributions to be paid by the subsidiary to the noncontrolling interests. |
(c) | Beginning with the second quarter of 2017, PennTex became a wholly owned subsidiary of ETP. The amounts reflected above for PennTex relate only to the first quarter of 2017, and no distributable cash flow has been attributed to noncontrolling interests in PennTex subsequent to March 31, 2017. |
(d) | Distributions on ETP Common Units and the number of ETP Common Units outstanding at the end of the period, both as reflected above, exclude amounts related to ETP Common Units held by subsidiaries of ETP. |
(e) | Reflects the sum of (i) the ETP Common Units outstanding at the end of period multiplied by a factor of 1.5x and (ii) the Sunoco Logistics Common Units outstanding at end of period minus 67.1 million Sunoco Logistics Common Units held by ETP, which units were cancelled in connection with the closing of the merger. |
(f) | Distribution coverage ratio for a period is calculated as Distributable Cash Flow attributable to partners, as adjusted, divided by net distributions expected to be paid to the partners of ETP in respect of such period. |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Segment Adjusted EBITDA: | |||||||
Intrastate transportation and storage | $ | 148 | $ | 149 | |||
Interstate transportation and storage | 262 | 278 | |||||
Midstream | 412 | 298 | |||||
NGL and refined products transportation and services (1) | 391 | 341 | |||||
Crude oil transportation and services (1) | 279 | 124 | |||||
All other | 107 | 180 | |||||
$ | 1,599 | $ | 1,370 |
(1) | Subsequent to the Sunoco Logistics Merger, the Partnership’s reportable segments were revised. Amounts reflected in prior periods have been retrospectively adjusted to conform to the current reportable segment presentation for NGL and refined products transportation and services and crude oil transportation and services. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Segment Margin by segment: | |||||||||||||||
Intrastate transportation and storage | $ | 202 | $ | 188 | $ | 384 | $ | 353 | |||||||
Interstate transportation and storage | 207 | 234 | 442 | 493 | |||||||||||
Midstream | 571 | 460 | 1,084 | 874 | |||||||||||
NGL and refined products transportation and services | 523 | 448 | 1,080 | 879 | |||||||||||
Crude oil transportation and services | 369 | 319 | 614 | 586 | |||||||||||
All other | 76 | 86 | 178 | 179 | |||||||||||
Intersegment eliminations | (114 | ) | (76 | ) | (245 | ) | (192 | ) | |||||||
Total Segment Margin | 1,834 | 1,659 | 3,537 | 3,172 | |||||||||||
Less: | |||||||||||||||
Operating expenses | 425 | 374 | 804 | 722 | |||||||||||
Depreciation, depletion and amortization | 557 | 496 | 1,117 | 966 | |||||||||||
Selling, general and administrative | 120 | 74 | 230 | 155 | |||||||||||
Operating income | $ | 732 | $ | 715 | $ | 1,386 | $ | 1,329 |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Natural gas transported (MMBtu/d) | 9,254,999 | 8,659,255 | |||||
Revenues | $ | 753 | $ | 541 | |||
Cost of products sold | 551 | 353 | |||||
Segment margin | 202 | 188 | |||||
Unrealized gains on commodity risk management activities | (21 | ) | (7 | ) | |||
Operating expenses, excluding non-cash compensation expense | (46 | ) | (41 | ) | |||
Selling, general and administrative expenses, excluding non-cash compensation expense | (5 | ) | (6 | ) | |||
Adjusted EBITDA related to unconsolidated affiliates | 18 | 15 | |||||
Segment Adjusted EBITDA | $ | 148 | $ | 149 | |||
Distributions from unconsolidated affiliates | $ | 14 | $ | 13 |
• | a decrease of $20 million in transportation fees due to renegotiated contracts resulting in lower billed volumes; |
• | a decrease of $13 million in storage margin (excluding net changes in unrealized amounts of $7 million related to fair value inventory adjustments and unrealized gains and losses on derivatives); and |
• | an increase of $5 million in operating expenses primarily due to higher maintenance and project related expenses of $6 million as well as higher compression fuel expense of $2 million, partially offset by fewer allocated expenses and lower capitalized overhead; partially offset by |
• | an increase of $29 million in natural gas sales and other (excluding changes in unrealized gains of $4 million) primarily from higher realized gains from pipeline optimization activity due to more favorable market conditions; |
• | an increase of $4 million in retained fuels (excluding changes in unrealized gains of $3 million) primarily due to higher market prices. The average spot price at the Houston Ship Channel location increased 53% for the quarter ended June 30, 2017 compared to the same period last year; and |
• | an increase of $3 million in adjusted EBITDA related to unconsolidated affiliates due to the Trans-Pecos and Comanche Trail pipelines that were placed in service in 2017. |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Natural gas transported (MMBtu/d) | 5,299,099 | 5,363,658 | |||||
Natural gas sold (MMBtu/d) | 17,035 | 21,539 | |||||
Revenues | $ | 207 | $ | 234 | |||
Operating expenses, excluding non-cash compensation, amortization and accretion expenses | (67 | ) | (75 | ) | |||
Selling, general and administrative expenses, excluding non-cash compensation, amortization and accretion expenses | (7 | ) | (11 | ) | |||
Adjusted EBITDA related to unconsolidated affiliates | 128 | 128 | |||||
Other | 1 | 2 | |||||
Segment Adjusted EBITDA | $ | 262 | $ | 278 | |||
Distributions from unconsolidated affiliates | $ | 52 | $ | 58 |
• | a decrease in revenues of $21 million on the Panhandle, Trunkline and Transwestern pipelines, including a $14 million decrease in reservation revenues and a decrease of $7 million in gas parking service related revenues on the Panhandle and Trunkline pipelines, primarily due to lack of customer demand driven by weak spreads and mild weather. In addition, revenues decreased by $3 million on the Tiger pipeline due to contract restructuring and $2 million on the Sea Robin pipeline due to producer maintenance and production declines; partially offset by |
• | a decrease in operating expenses of $8 million primarily due to lower allocated costs and system gas activity; and |
• | a decrease in selling, general and administrative expenses of $4 million due to refunds associated with legal fees, insurance premiums and franchise taxes. |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Gathered volumes (MMBtu/d) | 10,961,338 | 10,037,648 | |||||
NGLs produced (Bbls/d) | 473,699 | 468,732 | |||||
Equity NGLs (Bbls/d) | 28,083 | 31,638 | |||||
Revenues | $ | 1,615 | $ | 1,330 | |||
Cost of products sold | 1,044 | 870 | |||||
Segment margin | 571 | 460 | |||||
Unrealized gains on commodity risk management activities | (3 | ) | — | ||||
Operating expenses, excluding non-cash compensation expense | (152 | ) | (155 | ) | |||
Selling, general and administrative expenses, excluding non-cash compensation expense | (11 | ) | (13 | ) | |||
Adjusted EBITDA related to unconsolidated affiliates | 7 | 6 | |||||
Segment Adjusted EBITDA | $ | 412 | $ | 298 |
• | an increase of $45 million in non-fee based margin due to higher realized crude, NGL and natural gas prices; |
• | an increase of $1 million (excluding unrealized gains of $3 million) in non-fee based margin due to higher benefit from settled derivatives used to hedge commodity margins; |
• | an increase of $18 million in non-fee based margin due to volume increases in the Permian, partially offset by declines in the South Texas, North Texas, and Mid-Continent/Panhandle regions; |
• | an increase of $20 million in fee-based revenue due to minimum volume commitments in the South Texas region, as well as volume increases in the Permian and Northeast regions. These increases were partially offset by declines in South Texas, North Texas and the Mid-Continent/Panhandle regions; and |
• | an increase of $24 million in fee-based revenue due to recent acquisitions, including PennTex; partially offset by |
• | a decrease of $3 million in operating expenses primarily due to lower outside service costs and capitalized overhead; and |
• | a decrease in general and administrative expenses due to a favorable impact of $11 million from the adjustment of certain reserves that were recorded in connection with contingent matters, partially offset by an increase of $2 million in shared services allocation, a $1 million increase in insurance allocation, and a $3 million increase due to additional costs from the PennTex acquisition. |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
NGL transportation volumes (MBbls/d) | 835 | 741 | |||||
Refined products transportation volumes (MBbls/d) | 643 | 556 | |||||
NGL and refined products terminal volumes (MBbls/d) | 791 | 773 | |||||
NGL fractionation volumes (MBbls/d) | 431 | 345 | |||||
Revenues | $ | 1,768 | $ | 1,487 | |||
Cost of products sold | 1,245 | 1,039 | |||||
Segment margin | 523 | 448 | |||||
Unrealized (gains) losses on commodity risk management activities | (4 | ) | 10 | ||||
Operating expenses, excluding non-cash compensation expense | (129 | ) | (107 | ) | |||
Selling, general and administrative expenses, excluding non-cash compensation expense | (17 | ) | (15 | ) | |||
Adjusted EBITDA related to unconsolidated affiliates | 18 | 16 | |||||
Inventory valuation adjustments | — | (11 | ) | ||||
Segment Adjusted EBITDA | $ | 391 | $ | 341 |
• | an increase in storage margin of $4 million primarily due to increased volumes from our Mont Belvieu fractionators; |
• | an increase in transportation margin of $34 million primarily due to higher volumes on our Texas NGL pipelines and the ramp-up of volumes on our Mariner East system; |
• | an increase in fractionation and refinery services margin of $23 million (excluding changes in unrealized losses of $2 million) primarily due to higher NGL volumes from most major producing regions, as noted above; |
• | an increase in terminal services margin of $2 million due to higher terminal volumes from the Mariner NGL projects; and |
• | an increase of $8 million in marketing margin (excluding changes in unrealized gains of $16 million) primarily due to the timing of the recognition of margin from optimization activities; offset by |
• | an increase of $22 million in operating expenses primarily due to increased utilities costs associated with our fourth fractionator at Mont Belvieu and the Mariner project ramp-up at the Marcus Hook Industrial Complex of $3 million, higher ad valorem tax expenses of $6 million from our Lone Star Express pipeline beginning service in 2016, and higher employee expenses associated with assets placed in service of $10 million, project related service expenses of $2 million; and |
• | an increase of $2 million in selling, general and administrative expenses due to higher allocations and lower capitalized overhead resulting from reduced capital spending. |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Crude Transportation Volumes (MBbls/d) | 3,484 | 2,639 | |||||
Crude Terminals Volumes (MBbls/d) | 1,921 | 1,497 | |||||
Revenues | $ | 2,586 | $ | 1,989 | |||
Cost of products sold | 2,217 | 1,670 | |||||
Segment margin | 369 | 319 | |||||
Unrealized gains on commodity risk management activities | (2 | ) | — | ||||
Operating expenses, excluding non-cash compensation expense | (116 | ) | (63 | ) | |||
Selling, general and administrative expenses, excluding non-cash compensation expense | (32 | ) | (14 | ) | |||
Inventory valuation adjustments | 58 | (121 | ) | ||||
Adjusted EBITDA related to unconsolidated affiliates | 2 | 3 | |||||
Segment Adjusted EBITDA | $ | 279 | $ | 124 | |||
Distributions from unconsolidated affiliates | $ | 6 | $ | 5 |
• | an increase of $66 million due to the impact of LIFO accounting; and |
• | an increase of $129 million due to improved results from our crude oil pipelines, joint ventures and terminal activities, which was primarily attributed to expansion projects and the acquisition of Vitol Inc.’s crude oil assets in the fourth quarter of 2016, resulting in an increase of $109 million, as well as increased volumes and lower operating expenses from our existing crude pipeline and terminal assets resulting in an increase of $20 million; partially offset by |
• | a decrease of $21 million due to lower results from our crude oil acquisition and marketing activities; and |
• | an increase of $18 million in selling, general and administrative expenses driven largely by merger-related expenses and legal and environmental reserves. |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Revenues | $ | 870 | $ | 711 | |||
Cost of products sold | 794 | 625 | |||||
Segment margin | 76 | 86 | |||||
Unrealized (gains) losses on commodity risk management activities | (4 | ) | 15 | ||||
Operating expenses, excluding non-cash compensation expense | (34 | ) | (16 | ) | |||
Selling, general and administrative expenses, excluding non-cash compensation expense | (29 | ) | (19 | ) | |||
Adjusted EBITDA related to unconsolidated affiliates | 76 | 85 | |||||
Other | 21 | 24 | |||||
Eliminations | 1 | 5 | |||||
Segment Adjusted EBITDA | $ | 107 | $ | 180 | |||
Distributions from unconsolidated affiliates | $ | 40 | $ | 39 |
• | our equity method investment in limited partnership units of Sunoco LP consisting of 43.5 million units, representing 43.7% of Sunoco LP’s total outstanding common units; |
• | our natural gas marketing and compression operations; |
• | a non-controlling interest in PES, comprising 33% of PES’ outstanding common units; and |
• | our investment in Coal Handling, an entity that owns and operates end-user coal handling facilities. |
Growth | Maintenance | Total | |||||||||
Intrastate transportation and storage | $ | 23 | $ | 13 | $ | 36 | |||||
Interstate transportation and storage | 979 | 27 | 1,006 | ||||||||
Midstream | 560 | 45 | 605 | ||||||||
NGL and refined products transportation and services | 1,096 | 33 | 1,129 | ||||||||
Crude oil transportation and services | 231 | 21 | 252 | ||||||||
All other (including eliminations) | 70 | 28 | 98 | ||||||||
Total capital expenditures | $ | 2,959 | $ | 167 | $ | 3,126 |
Facility Size | Funds Available at June 30, 2017 | Maturity Date | |||||||
Legacy ETP Revolving Credit Facility | $ | 3,750 | $ | 2,066 | November 18, 2019 | ||||
Legacy Sunoco Logistics Revolving Credit Facility | 2,500 | 827 | March 20, 2020 | ||||||
$ | 6,250 | $ | 2,893 |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Equity in earnings (losses) of unconsolidated affiliates: | |||||||
Citrus | $ | 30 | $ | 28 | |||
FEP | 13 | 12 | |||||
PES | (20 | ) | 7 | ||||
MEP | 10 | 11 | |||||
HPC | 5 | 7 | |||||
AmeriGas | (6 | ) | 19 | ||||
Sunoco LP | (110 | ) | 23 | ||||
Other | 17 | 12 | |||||
Total equity in earnings (losses) of unconsolidated affiliates | $ | (61 | ) | $ | 119 | ||
Adjusted EBITDA related to unconsolidated affiliates: | |||||||
Citrus | $ | 88 | $ | 87 | |||
FEP | 19 | 18 | |||||
PES | (10 | ) | 17 | ||||
MEP | 21 | 23 | |||||
HPC | 12 | 15 | |||||
Sunoco LP | 83 | 68 | |||||
Other | 34 | 24 | |||||
Total Adjusted EBITDA related to unconsolidated affiliates | $ | 247 | $ | 252 | |||
Distributions received from unconsolidated affiliates: | |||||||
Citrus | $ | 22 | $ | 27 | |||
FEP | 10 | 13 | |||||
AmeriGas | 3 | 3 | |||||
MEP | 20 | 18 | |||||
HPC | 13 | 13 | |||||
Sunoco LP | 37 | 36 | |||||
Other | 14 | 10 | |||||
Total distributions received from unconsolidated affiliates | $ | 119 | $ | 120 |