Energy Transfer Reports Strong Third Quarter 2022 Results and Raises 2022 Outlook
Energy Transfer LP (NYSE: ET) reported a strong financial performance for Q3 2022, with net income attributable to partners of $1.01 billion, up $371 million year-over-year. Adjusted EBITDA increased to $3.09 billion from $2.58 billion. Notably, despite a $126 million legal charge in crude oil services and a $130 million negative adjustment in NGL, the Partnership's Distributable Cash Flow rose to $1.58 billion. Volumes across all core segments increased, reaching record highs in natural gas transportation. The company expects full-year Adjusted EBITDA between $12.8 billion and $13.0 billion.
- Net income attributable to partners increased by $371 million YoY, totaling $1.01 billion.
- Adjusted EBITDA grew to $3.09 billion, up 19.8% from $2.58 billion YoY.
- Distributable Cash Flow attributable to partners rose to $1.58 billion from $1.31 billion YoY.
- Record-high volumes in all core segments, with intrastate natural gas transportation up 28%.
- Full-year Adjusted EBITDA guidance raised to $12.8-$13.0 billion.
- Charged $126 million in crude oil services related to a legal matter.
- Negative adjustment of approximately $130 million in NGL and refined products, impacting Adjusted EBITDA by $260 million.
Energy Transfer reported net income attributable to partners for the three months ended
Adjusted EBITDA for the three months ended
Distributable Cash Flow attributable to partners, as adjusted, for the three months ended
The improved results were primarily due to higher volumes across all of our core segments and the impacts of the recent acquisition of Enable Midstream.
Key accomplishments and recent developments:
Operational
-
Energy Transfer’s nation-wide system, with diverse products and services, is well-positioned throughout various markets. During the third quarter of 2022, each of Energy Transfer’s five core segments realized higher volumes compared with the same period in 2021.
-
Intrastate natural gas transportation volumes were up
28% and set a new Partnership record. -
Interstate natural gas transportation volumes were up
43% . -
Midstream gathered volumes were up
47% and set a new Partnership record. -
NGL transportation volumes were up
5% . -
NGL fractionation volumes were up
6% and set a new Partnership record. -
Crude oil transportation and terminal volumes were up
10% and14% , respectively.
-
Intrastate natural gas transportation volumes were up
-
Energy Transfer’s
Nederland terminal and related facilities serve as critical resources with access to theU.S. Strategic Petroleum Reserve (“SPR”). Higher SPR volumes and increased activity in the region drove transportation and terminal volumes at theNederland andHouston terminals to new records during the third quarter. - Mainline construction on the Gulf Run Pipeline was recently finished and the project remains on schedule to be completed by year-end
Strategic
-
Over 90 percent of Energy Transfer’s growth capital spending is comprised of projects that are already on-line or expected to be on-line and contributing cash flow at very attractive returns before the end of 2023. The project backlog includes Gulf Run Pipeline in
Louisiana ,Grey Wolf and Bear processing plants in thePermian Basin , Fractionator VIII inMont Belvieu and LPG facilities projects at Energy Transfer’sNederland Terminal . -
In
September 2022 , Energy Transfer completed the acquisition ofWoodford Express, LLC , which owns a Mid-Continent gas gathering and processing system, for approximately . The system, which is located in the heart of the SCOOP play, has 450 MMcf per day of cryogenic gas processing and treating capacity and over 200 miles of gathering and transportation lines, which are connected to Energy Transfer’s pipeline network. The system is supported by dedicated acreage with long-term, predominantly fixed-fee contracts with active, proven producers.$485 million -
In
August 2022 , Energy Transfer announced a 20-year LNG Sale and Purchase Agreement (“SPA”) withShell NA LNG LLC . To date in 2022, the Partnership has entered into six long-term LNG SPAs. Under these SPAs,Energy Transfer LNG Export, LLC is expected to supply a total of 7.9 million tonnes of LNG per annum, with terms ranging from 18 to 25 years. -
In
August 2022 , the Partnership completed the previously announced sale of its51% interest in Energy Transfer Canada for cash proceeds to Energy Transfer of approximately . The sale reduced Energy Transfer’s consolidated debt by approximately$302 million , which includes the use of proceeds to pay down Energy Transfer’s revolving credit facility and the deconsolidation of Energy Transfer Canada’s debt.$850 million
Financial
-
Energy Transfer’s base business continues to execute well with performance ahead of expectations, driven by continued strong demand across Energy Transfer’s network. As a result, the Partnership now expects Adjusted EBITDA for the full year 2022 to be between
and$12.8 billion (previously$13.0 billion to$12.6 billion ). The Partnership continues to expect its 2022 growth capital expenditures to be between$12.8 billion and$1.8 billion .$2.1 billion -
In
October 2022 , Energy Transfer announced a quarterly cash distribution of per common unit ($0.26 5 annualized) for the quarter ended$1.06 September 30, 2022 . This distribution represents a more than70% increase over the third quarter of 2021. Future increases to the distribution level will continue to be evaluated quarterly with the ultimate goal of returning distributions to the previous level of per common unit per quarter ($0.30 5 annualized) while balancing the Partnership’s leverage target, growth opportunities and unit buybacks.$1.22 -
As of
September 30, 2022 , the Partnership’s revolving credit facility had of available capacity.$2.32 billion -
For the three months ended
September 30, 2022 , the Partnership invested approximately on growth capital expenditures.$500 million
Energy Transfer benefits from a portfolio of assets with exceptional product and geographic diversity. The Partnership’s multiple segments generate high-quality, balanced earnings with no single segment contributing more than
Conference Call information:
The Partnership has scheduled a conference call for
Forward-Looking Statements
This news 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. An extensive list of factors that can affect future results, including future distribution levels and leverage ratio, are discussed in the Partnership’s Annual Report 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 website at www.energytransfer.com.
CONDENSED CONSOLIDATED BALANCE SHEETS (In millions) (unaudited) |
|||||||
|
|
|
|
||||
|
2022 |
|
2021 |
||||
ASSETS |
|
|
|
||||
Current assets |
$ |
12,159 |
|
|
$ |
10,537 |
|
|
|
|
|
||||
Property, plant and equipment, net |
|
80,261 |
|
|
|
81,607 |
|
|
|
|
|
||||
Investments in unconsolidated affiliates |
|
2,869 |
|
|
|
2,947 |
|
Lease right-of-use assets, net |
|
815 |
|
|
|
838 |
|
Other non-current assets, net |
|
1,573 |
|
|
|
1,645 |
|
Intangible assets, net |
|
5,505 |
|
|
|
5,856 |
|
|
|
2,553 |
|
|
|
2,533 |
|
Total assets |
$ |
105,735 |
|
|
$ |
105,963 |
|
LIABILITIES AND EQUITY |
|
|
|
||||
Current liabilities |
$ |
11,243 |
|
|
$ |
10,835 |
|
|
|
|
|
||||
Long-term debt, less current maturities |
|
47,413 |
|
|
|
49,022 |
|
Non-current derivative liabilities |
|
33 |
|
|
|
193 |
|
Non-current operating lease liabilities |
|
794 |
|
|
|
814 |
|
Deferred income taxes |
|
3,661 |
|
|
|
3,648 |
|
Other non-current liabilities |
|
1,530 |
|
|
|
1,323 |
|
|
|
|
|
||||
Commitments and contingencies |
|
|
|
||||
Redeemable noncontrolling interests |
|
493 |
|
|
|
783 |
|
|
|
|
|
||||
Equity: |
|
|
|
||||
Limited Partners: |
|
|
|
||||
Preferred Unitholders |
|
6,077 |
|
|
|
6,051 |
|
Common Unitholders |
|
26,725 |
|
|
|
25,230 |
|
|
|
(3 |
) |
|
|
(4 |
) |
Accumulated other comprehensive income |
|
32 |
|
|
|
23 |
|
Total partners’ capital |
|
32,831 |
|
|
|
31,300 |
|
Noncontrolling interests |
|
7,737 |
|
|
|
8,045 |
|
Total equity |
|
40,568 |
|
|
|
39,345 |
|
Total liabilities and equity |
$ |
105,735 |
|
|
$ |
105,963 |
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except per unit data) (unaudited) |
|||||||||||||||
|
|
|
|
||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||
REVENUES |
$ |
22,939 |
|
|
$ |
16,664 |
|
|
$ |
69,375 |
|
|
$ |
48,760 |
|
COSTS AND EXPENSES: |
|
|
|
|
|
|
|
||||||||
Cost of products sold |
|
18,516 |
|
|
|
13,188 |
|
|
|
56,169 |
|
|
|
35,641 |
|
Operating expenses |
|
973 |
|
|
|
898 |
|
|
|
2,982 |
|
|
|
2,585 |
|
Depreciation, depletion and amortization |
|
1,030 |
|
|
|
943 |
|
|
|
3,104 |
|
|
|
2,837 |
|
Selling, general and administrative |
|
361 |
|
|
|
198 |
|
|
|
802 |
|
|
|
583 |
|
Impairment losses and other |
|
86 |
|
|
|
— |
|
|
|
386 |
|
|
|
11 |
|
Total costs and expenses |
|
20,966 |
|
|
|
15,227 |
|
|
|
63,443 |
|
|
|
41,657 |
|
OPERATING INCOME |
|
1,973 |
|
|
|
1,437 |
|
|
|
5,932 |
|
|
|
7,103 |
|
OTHER INCOME (EXPENSE): |
|
|
|
|
|
|
|
||||||||
Interest expense, net of interest capitalized |
|
(577 |
) |
|
|
(558 |
) |
|
|
(1,714 |
) |
|
|
(1,713 |
) |
Equity in earnings of unconsolidated affiliates |
|
68 |
|
|
|
71 |
|
|
|
186 |
|
|
|
191 |
|
Losses on extinguishments of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(8 |
) |
Gains on interest rate derivatives |
|
60 |
|
|
|
1 |
|
|
|
303 |
|
|
|
72 |
|
Other, net |
|
(120 |
) |
|
|
33 |
|
|
|
(117 |
) |
|
|
45 |
|
INCOME BEFORE INCOME TAX EXPENSE |
|
1,404 |
|
|
|
984 |
|
|
|
4,590 |
|
|
|
5,690 |
|
Income tax expense |
|
82 |
|
|
|
77 |
|
|
|
159 |
|
|
|
234 |
|
NET INCOME |
|
1,322 |
|
|
|
907 |
|
|
|
4,431 |
|
|
|
5,456 |
|
Less: Net income attributable to noncontrolling interests |
|
304 |
|
|
|
260 |
|
|
|
793 |
|
|
|
870 |
|
Less: Net income attributable to redeemable noncontrolling interests |
|
12 |
|
|
|
12 |
|
|
|
37 |
|
|
|
37 |
|
NET INCOME ATTRIBUTABLE TO PARTNERS |
|
1,006 |
|
|
|
635 |
|
|
|
3,601 |
|
|
|
4,549 |
|
General Partner’s interest in net income |
|
1 |
|
|
|
1 |
|
|
|
3 |
|
|
|
5 |
|
Preferred Unitholders’ interest in net income |
|
106 |
|
|
|
99 |
|
|
|
317 |
|
|
|
185 |
|
Limited Partners’ interest in net income |
$ |
899 |
|
|
$ |
535 |
|
|
$ |
3,281 |
|
|
$ |
4,359 |
|
NET INCOME PER COMMON UNIT: |
|
|
|
|
|
|
|
||||||||
Basic |
$ |
0.29 |
|
|
$ |
0.20 |
|
|
$ |
1.06 |
|
|
$ |
1.61 |
|
Diluted |
$ |
0.29 |
|
|
$ |
0.20 |
|
|
$ |
1.06 |
|
|
$ |
1.60 |
|
WEIGHTED AVERAGE NUMBER OF UNITS OUTSTANDING: |
|
|
|
|
|
|
|
||||||||
Basic |
|
3,087.6 |
|
|
|
2,705.2 |
|
|
|
3,085.6 |
|
|
|
2,704.0 |
|
Diluted |
|
3,108.6 |
|
|
|
2,720.6 |
|
|
|
3,106.4 |
|
|
|
2,718.4 |
|
SUPPLEMENTAL INFORMATION (Dollars and units in millions) (unaudited) |
|||||||||||||||
|
|
|
|
||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021(a) |
||||||||
Reconciliation of net income to Adjusted EBITDA and Distributable Cash Flow(b): |
|
|
|
|
|
|
|
||||||||
Net income |
$ |
1,322 |
|
|
$ |
907 |
|
|
$ |
4,431 |
|
|
$ |
5,456 |
|
Interest expense, net of interest capitalized |
|
577 |
|
|
|
558 |
|
|
|
1,714 |
|
|
|
1,713 |
|
Impairment losses and other |
|
86 |
|
|
|
— |
|
|
|
386 |
|
|
|
11 |
|
Income tax expense |
|
82 |
|
|
|
77 |
|
|
|
159 |
|
|
|
234 |
|
Depreciation, depletion and amortization |
|
1,030 |
|
|
|
943 |
|
|
|
3,104 |
|
|
|
2,837 |
|
Non-cash compensation expense |
|
27 |
|
|
|
26 |
|
|
|
88 |
|
|
|
81 |
|
Gains on interest rate derivatives |
|
(60 |
) |
|
|
(1 |
) |
|
|
(303 |
) |
|
|
(72 |
) |
Unrealized (gains) losses on commodity risk management activities |
|
(76 |
) |
|
|
19 |
|
|
|
(130 |
) |
|
|
(74 |
) |
Losses on extinguishments of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8 |
|
Inventory valuation adjustments ( |
|
40 |
|
|
|
(9 |
) |
|
|
(81 |
) |
|
|
(168 |
) |
Equity in earnings of unconsolidated affiliates |
|
(68 |
) |
|
|
(71 |
) |
|
|
(186 |
) |
|
|
(191 |
) |
Adjusted EBITDA related to unconsolidated affiliates |
|
147 |
|
|
|
141 |
|
|
|
409 |
|
|
|
400 |
|
Other, net |
|
(19 |
) |
|
|
(11 |
) |
|
|
65 |
|
|
|
— |
|
Adjusted EBITDA (consolidated) |
|
3,088 |
|
|
|
2,579 |
|
|
|
9,656 |
|
|
|
10,235 |
|
Adjusted EBITDA related to unconsolidated affiliates |
|
(147 |
) |
|
|
(141 |
) |
|
|
(409 |
) |
|
|
(400 |
) |
Distributable cash flow from unconsolidated affiliates |
|
102 |
|
|
|
103 |
|
|
|
270 |
|
|
|
268 |
|
Interest expense, net of interest capitalized |
|
(577 |
) |
|
|
(558 |
) |
|
|
(1,714 |
) |
|
|
(1,713 |
) |
Preferred unitholders’ distributions |
|
(118 |
) |
|
|
(110 |
) |
|
|
(353 |
) |
|
|
(305 |
) |
Current income tax expense |
|
(31 |
) |
|
|
(10 |
) |
|
|
(1 |
) |
|
|
(34 |
) |
Transaction-related income taxes(c) |
|
— |
|
|
|
— |
|
|
|
(42 |
) |
|
|
— |
|
Maintenance capital expenditures |
|
(247 |
) |
|
|
(155 |
) |
|
|
(527 |
) |
|
|
(371 |
) |
Other, net |
|
5 |
|
|
|
14 |
|
|
|
17 |
|
|
|
50 |
|
Distributable Cash Flow (consolidated) |
|
2,075 |
|
|
|
1,722 |
|
|
|
6,897 |
|
|
|
7,730 |
|
Distributable Cash Flow attributable to |
|
(195 |
) |
|
|
(146 |
) |
|
|
(496 |
) |
|
|
(399 |
) |
Distributions from |
|
41 |
|
|
|
41 |
|
|
|
124 |
|
|
|
124 |
|
Distributable Cash Flow attributable to USAC ( |
|
(55 |
) |
|
|
(52 |
) |
|
|
(161 |
) |
|
|
(157 |
) |
Distributions from USAC |
|
25 |
|
|
|
25 |
|
|
|
73 |
|
|
|
73 |
|
Distributable Cash Flow attributable to noncontrolling interests in other non-wholly-owned consolidated subsidiaries |
|
(315 |
) |
|
|
(284 |
) |
|
|
(926 |
) |
|
|
(786 |
) |
Distributable Cash Flow attributable to the partners of Energy Transfer |
|
1,576 |
|
|
|
1,306 |
|
|
|
5,511 |
|
|
|
6,585 |
|
Transaction-related adjustments |
|
5 |
|
|
|
6 |
|
|
|
26 |
|
|
|
34 |
|
Distributable Cash Flow attributable to the partners of Energy Transfer, as adjusted |
$ |
1,581 |
|
|
$ |
1,312 |
|
|
$ |
5,537 |
|
|
$ |
6,619 |
|
Distributions to partners: |
|
|
|
|
|
|
|
||||||||
Limited Partners |
$ |
818 |
|
|
$ |
413 |
|
|
$ |
2,145 |
|
|
$ |
1,238 |
|
|
|
1 |
|
|
|
1 |
|
|
|
2 |
|
|
|
2 |
|
Total distributions to be paid to partners |
$ |
819 |
|
|
$ |
414 |
|
|
$ |
2,147 |
|
|
$ |
1,240 |
|
Common Units outstanding – end of period |
|
3,088.0 |
|
|
|
2,705.8 |
|
|
|
3,088.0 |
|
|
|
2,705.8 |
|
Distribution coverage ratio |
1.93x |
|
3.17x |
|
2.58x |
|
5.34x |
(a) |
Winter Storm Uri, which occurred in |
|
(b) |
Adjusted EBITDA, Distributable Cash Flow and distribution coverage ratio are non-GAAP financial measures used by industry analysts, investors, lenders and rating agencies to assess the financial performance and the operating results of Energy Transfer’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. |
|
|
There are material limitations to using measures such as Adjusted EBITDA, Distributable Cash Flow and distribution coverage ratio, including the difficulty associated with using any such measure 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, Distributable Cash Flow and distribution coverage ratio 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 operating income, net income and cash flow from operating activities. |
|
|
Definition of Adjusted EBITDA |
|
|
We define Adjusted EBITDA as total partnership earnings before interest, taxes, depreciation, depletion, 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, inventory valuation adjustments, non-cash impairment charges, losses on extinguishments of debt and other non-operating income or expense items. Inventory adjustments that are excluded from the calculation of Adjusted EBITDA represent only the changes in lower of cost or market reserves on inventory that is carried at last-in, first-out (“LIFO”). These amounts are unrealized valuation adjustments applied to Sunoco LP’s fuel volumes remaining in inventory at the end of the period. |
|
|
Adjusted EBITDA reflects amounts for unconsolidated affiliates based on the same recognition and measurement methods used to record equity in earnings of unconsolidated affiliates. Adjusted EBITDA related to unconsolidated affiliates excludes the same items with respect to the unconsolidated affiliate as those excluded from the calculation of Adjusted EBITDA, such as interest, taxes, depreciation, depletion, amortization and other non-cash items. Although these amounts are excluded from Adjusted EBITDA related to unconsolidated affiliates, such exclusion should not be understood to imply that we have control over the operations and resulting revenues and expenses of such affiliates. We do not control our unconsolidated affiliates; therefore, we do not control the earnings or cash flows of such affiliates. The use of Adjusted EBITDA or Adjusted EBITDA related to unconsolidated affiliates as an analytical tool should be limited accordingly. |
|
|
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 |
|
|
We define Distributable Cash Flow as net income, adjusted for certain non-cash items, less distributions to preferred unitholders and maintenance capital expenditures. Non-cash items include depreciation, depletion and amortization, non-cash compensation expense, amortization included in interest 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, inventory valuation adjustments, non-cash impairment charges, losses on extinguishments of debt and deferred income taxes. For unconsolidated affiliates, Distributable Cash Flow reflects the Partnership’s proportionate share of the investee’s distributable cash flow. |
|
|
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 |
|
|
|
|
|
|
|
|
For Distributable Cash Flow attributable to partners, as adjusted, certain transaction-related adjustments and non-recurring expenses that are included in net income are excluded. |
|
|
Definition of Distribution Coverage Ratio |
|
|
Distribution coverage ratio for a period is calculated as Distributable Cash Flow attributable to partners, as adjusted, divided by distributions expected to be paid to the partners of Energy Transfer in respect of such period. |
|
(c) |
For the nine months ended |
|
SUMMARY ANALYSIS OF QUARTERLY RESULTS BY SEGMENT (Tabular dollar amounts in millions) (unaudited) |
|||||
|
|
||||
|
Three Months Ended
|
||||
|
2022 |
|
2021 |
||
Segment Adjusted EBITDA: |
|
|
|
||
Intrastate transportation and storage |
$ |
301 |
|
$ |
172 |
Interstate transportation and storage |
|
409 |
|
|
334 |
Midstream |
|
868 |
|
|
556 |
NGL and refined products transportation and services |
|
634 |
|
|
706 |
Crude oil transportation and services |
|
461 |
|
|
496 |
Investment in |
|
276 |
|
|
198 |
Investment in USAC |
|
109 |
|
|
99 |
All other |
|
30 |
|
|
18 |
Total Segment Adjusted EBITDA |
$ |
3,088 |
|
$ |
2,579 |
The following analysis of segment operating results includes a measure of segment margin. Segment margin is a non-GAAP financial measure and is presented herein to assist in the analysis of segment operating results and particularly to facilitate an understanding of the impacts that changes in sales revenues have on the segment performance measure of Segment Adjusted EBITDA. Segment margin is similar to the GAAP measure of gross margin, except that segment margin excludes charges for depreciation, depletion and amortization. Among the GAAP measures reported by the Partnership, the most directly comparable measure to segment margin is Segment Adjusted EBITDA; a reconciliation of segment margin to Segment Adjusted EBITDA is included in the following tables for each segment where segment margin is presented.
In addition, for certain segments, the sections below include information on the components of segment margin by sales type, which components are included in order to provide additional disaggregated information to facilitate the analysis of segment margin and Segment Adjusted EBITDA. For example, these components include transportation margin, storage margin and other margin. These components of segment margin are calculated consistent with the calculation of segment margin; therefore, these components also exclude charges for depreciation, depletion and amortization.
Intrastate Transportation and Storage |
|||||||
|
Three Months Ended
|
||||||
|
2022 |
|
2021 |
||||
Natural gas transported (BBtu/d) |
|
14,878 |
|
|
|
11,601 |
|
Withdrawals from storage natural gas inventory (BBtu) |
|
— |
|
|
|
2,350 |
|
Revenues |
$ |
2,383 |
|
|
$ |
1,217 |
|
Cost of products sold |
|
1,994 |
|
|
|
978 |
|
Segment margin |
|
389 |
|
|
|
239 |
|
Unrealized (gains) losses on commodity risk management activities |
|
12 |
|
|
|
(1 |
) |
Operating expenses, excluding non-cash compensation expense |
|
(93 |
) |
|
|
(64 |
) |
Selling, general and administrative expenses, excluding non-cash compensation expense |
|
(12 |
) |
|
|
(8 |
) |
Adjusted EBITDA related to unconsolidated affiliates |
|
5 |
|
|
|
6 |
|
Segment Adjusted EBITDA |
$ |
301 |
|
|
$ |
172 |
|
Transported volumes increased primarily due to the acquisition of the
Segment Adjusted EBITDA. For the three months ended
-
an increase of
in realized natural gas sales and other primarily due to higher optimization;$100 million -
an increase of
in transportation fees primarily due to fees from the Enable Oklahoma Intrastate Transmission System; and$40 million -
an increase of
in retained fuel revenues related to higher natural gas prices; partially offset by$29 million -
an increase of
in operating expenses primarily due to a$29 million increase in cost of fuel consumption, a$17 million increase from additional expenses from the Enable assets and a$7 million increase in utilities expenses;$4 million -
a decrease of
in storage margin primarily due to lower storage optimization; and$8 million -
an increase of
in selling, general and administrative expenses primarily due to the addition of Enable.$4 million
Interstate Transportation and Storage |
|||||||
|
Three Months Ended
|
||||||
|
2022 |
|
2021 |
||||
Natural gas transported (BBtu/d) |
|
14,157 |
|
|
|
9,917 |
|
Natural gas sold (BBtu/d) |
|
28 |
|
|
|
16 |
|
Revenues |
$ |
549 |
|
|
$ |
418 |
|
Cost of products sold |
|
3 |
|
|
|
— |
|
Segment margin |
|
546 |
|
|
|
418 |
|
Operating expenses, excluding non-cash compensation, amortization and accretion expenses |
|
(219 |
) |
|
|
(152 |
) |
Selling, general and administrative expenses, excluding non-cash compensation, amortization and accretion expenses |
|
(37 |
) |
|
|
(21 |
) |
Adjusted EBITDA related to unconsolidated affiliates |
|
106 |
|
|
|
91 |
|
Other |
|
13 |
|
|
|
(2 |
) |
Segment Adjusted EBITDA |
$ |
409 |
|
|
$ |
334 |
|
Transported volumes increased primarily due to the impact of the Enable Acquisition, higher utilization on our Tiger system due to increased production in the
Segment Adjusted EBITDA. For the three months ended
-
an increase of
in segment margin primarily due to a$128 million increase as a result of higher volumes from the Enable Acquisition and increased production in the$137 million Haynesville Shale andPermian Basin and a increase due to higher volumes and higher rates from operational gas sales. These increases were partially offset by a$2 million decrease due to a shipper bankruptcy on our Rover system and a$5 million decrease on our$6 million Panhandle system resulting from developments in an ongoing rate case; -
an increase of
in Adjusted EBITDA related to unconsolidated affiliates primarily due to an increase of$15 million resulting from the Enable Acquisition and a$12 million increase from our$3 million Midcontinent Express Pipeline joint venture as a result of higher revenue due to capacity sold at higher rates; and -
an increase of
in other primarily due to the realization in the current period of certain amounts related to a shipper bankruptcy that occurred in a prior period; partially offset by$15 million -
an increase of
in operating expenses primarily due to a$67 million increase from the impact of the Enable Acquisition and a$71 million increase in maintenance related expenses, partially offset by a$3 million decrease from shipper imbalances; and$7 million -
an increase of
in selling, general and administrative expenses primarily due to the impact of the Enable Acquisition.$16 million
Midstream |
|||||||
|
Three Months Ended
|
||||||
|
2022 |
|
2021 |
||||
Gathered volumes (BBtu/d) |
|
19,107 |
|
|
|
12,991 |
|
NGLs produced (MBbls/d) |
|
814 |
|
|
|
667 |
|
Equity NGLs (MBbls/d) |
|
43 |
|
|
|
37 |
|
Revenues |
$ |
4,871 |
|
|
$ |
2,919 |
|
Cost of products sold |
|
3,678 |
|
|
|
2,153 |
|
Segment margin |
|
1,193 |
|
|
|
766 |
|
Operating expenses, excluding non-cash compensation expense |
|
(275 |
) |
|
|
(191 |
) |
Selling, general and administrative expenses, excluding non-cash compensation expense |
|
(55 |
) |
|
|
(28 |
) |
Adjusted EBITDA related to unconsolidated affiliates |
|
5 |
|
|
|
8 |
|
Other |
|
— |
|
|
|
1 |
|
Segment Adjusted EBITDA |
$ |
868 |
|
|
$ |
556 |
|
Gathered volumes and NGL production increased compared to the same period last year primarily due to increases in all regions.
Segment Adjusted EBITDA. For the three months ended
-
an increase of
in non-fee-based margin due to favorable natural gas prices of$33 million and NGL prices of$25 million ;$8 million -
an increase of
in non-fee-based margin due to the Enable Acquisition in$124 million December 2021 ; and -
an increase of
in fee-based margin due to the Enable Acquisition in$271 million December 2021 , as well as increased production in the Permian andSouth Texas regions; partially offset by -
an increase of
in operating expenses due to$84 million in incremental operating expenses related to the Enable assets acquired in$64 million December 2021 and an increase in maintenance project costs and materials in the$18 million South Texas and Permian regions; and -
an increase of
in selling, general and administrative expenses primarily due to a$27 million increase from the impact of the Enable Acquisition and a$10 million increase in insurance and legal fees.$13 million
NGL and Refined Products Transportation and Services |
|||||||
|
Three Months Ended
|
||||||
|
2022 |
|
2021 |
||||
NGL transportation volumes (MBbls/d) |
|
1,892 |
|
|
|
1,803 |
|
Refined products transportation volumes (MBbls/d) |
|
543 |
|
|
|
526 |
|
NGL and refined products terminal volumes (MBbls/d) |
|
1,287 |
|
|
|
1,237 |
|
NGL fractionation volumes (MBbls/d) |
|
940 |
|
|
|
884 |
|
Revenues |
$ |
6,075 |
|
|
$ |
5,262 |
|
Cost of products sold |
|
5,044 |
|
|
|
4,347 |
|
Segment margin |
|
1,031 |
|
|
|
915 |
|
Unrealized gains on commodity risk management activities |
|
(126 |
) |
|
|
(2 |
) |
Operating expenses, excluding non-cash compensation expense |
|
(265 |
) |
|
|
(207 |
) |
Selling, general and administrative expenses, excluding non-cash compensation expense |
|
(33 |
) |
|
|
(27 |
) |
Adjusted EBITDA related to unconsolidated affiliates |
|
27 |
|
|
|
26 |
|
Other |
|
— |
|
|
|
1 |
|
Segment Adjusted EBITDA |
$ |
634 |
|
|
$ |
706 |
|
NGL transportation volumes increased primarily due to higher volumes from the Permian and
Refined products transportation volumes increased due to recovery from COVID-19 related demand reduction in the prior period.
NGL and refined products terminal volumes increased primarily due to higher volumes on our export pipelines and refined product demand recovery.
Average fractionated volumes at our
Segment Adjusted EBITDA. For the three months ended
-
an increase of
in fractionators and refinery services margin primarily due to a$45 million increase from higher volumes and higher rates driven by contractual rate escalations tied to broader economic inflationary measures. This increase was partially offset by a decrease from our refinery services business due to a less favorable pricing environment;$48 million -
an increase of
in transportation margin primarily due to a$39 million increase resulting from higher y-grade throughput and higher rates driven by contractual rate escalations tied to broader economic inflationary measures on our$62 million Texas pipeline system, and a increase from higher throughput on our$5 million Mariner East pipeline system. These increases were partially offset by a decrease from lower throughput on our$10 million Mariner West pipeline due to the timing of customer facility maintenance and a decrease from intrasegment charges which are fully offset within our marketing and fractionators margin;$16 million -
an increase of
in terminal services margin primarily due to a$13 million increase from higher rates on export volumes loaded at our$9 million Nederland Terminal and a increase from higher throughput at our$3 million Marcus Hook Terminal ; and -
an increase of
in storage margin primarily due to a$9 million increase from the timing of third-party deficiency payments, a$4 million increase in component product storage fees and a$2 million increase from the timing of cavern withdrawals; offset by$2 million -
a decrease of
in marketing margin primarily due to losses of approximately$114 million from the optimization of NGL component products primarily due to the timing of the recognition of gains on hedged inventory. Associated hedge positions recorded unrealized gains of$128 million during the third quarter of 2022. These decreases were partially offset by an$125 million increase from intrasegment charges which are fully offset within our transportation margin;$11 million -
an increase of
in operating expenses primarily due to a$58 million increase in gas and power utility costs, a$43 million increase in ad valorem taxes, a$6 million increase in physical product losses and a$5 million increase in maintenance project costs; and$3 million -
an increase of
in selling, general and administrative expenses primarily due to a$6 million increase in overhead expenses allocated to the segment, a$2 million increase in employee related costs and a$1 million increase in insurance costs.$1 million
Crude Oil Transportation and Services |
|||||||
|
Three Months Ended
|
||||||
|
2022 |
|
2021 |
||||
Crude transportation volumes (MBbls/d) |
|
4,575 |
|
|
|
4,173 |
|
Crude terminal volumes (MBbls/d) |
|
3,080 |
|
|
|
2,703 |
|
Revenues |
$ |
6,416 |
|
|
$ |
4,578 |
|
Cost of products sold |
|
5,627 |
|
|
|
3,918 |
|
Segment margin |
|
789 |
|
|
|
660 |
|
Unrealized losses on commodity risk management activities |
|
2 |
|
|
|
14 |
|
Operating expenses, excluding non-cash compensation expense |
|
(176 |
) |
|
|
(142 |
) |
Selling, general and administrative expenses, excluding non-cash compensation expense |
|
(155 |
) |
|
|
(44 |
) |
Adjusted EBITDA related to unconsolidated affiliates |
|
1 |
|
|
|
7 |
|
Other |
|
— |
|
|
|
1 |
|
Segment Adjusted EBITDA |
$ |
461 |
|
|
$ |
496 |
|
Crude transportation volumes were higher on our
Segment Adjusted EBITDA. For the three months ended
-
an increase of
in segment margin (excluding unrealized gains and losses on commodity risk management activities) primarily due to a$117 million increase due to higher volumes on our Bakken Pipeline, a$36 million increase related to assets acquired in 2021, a$28 million increase in throughput at our$45 million Gulf Coast terminals due to Strategic Petroleum Reserve volumes, stronger refinery utilization and higher export demand, a increase on our$6 million Bayou Bridge pipeline due to higher volumes and a increase on our$5 million Texas pipeline system due to higher volumes; offset by -
an increase of
in operating expenses primarily due to higher volume-driven expenses, higher project expenses and expenses related to assets acquired in 2021;$34 million -
an increase of
in selling, general and administrative expenses primarily due to a charge related to a legal matter; and$111 million -
a decrease of
in Adjusted EBITDA related to unconsolidated affiliates due to the consolidation of certain operations that were previously reflected as unconsolidated affiliates.$6 million
Investment in |
|||||||
|
Three Months Ended
|
||||||
|
2022 |
|
2021 |
||||
Revenues |
$ |
6,594 |
|
|
$ |
4,779 |
|
Cost of products sold |
|
6,261 |
|
|
|
4,472 |
|
Segment margin |
|
333 |
|
|
|
307 |
|
Unrealized losses on commodity risk management activities |
|
23 |
|
|
|
2 |
|
Operating expenses, excluding non-cash compensation expense |
|
(98 |
) |
|
|
(85 |
) |
Selling, general and administrative expenses, excluding non-cash compensation expense |
|
(29 |
) |
|
|
(23 |
) |
Adjusted EBITDA related to unconsolidated affiliates |
|
2 |
|
|
|
3 |
|
Inventory valuation adjustments |
|
40 |
|
|
|
(9 |
) |
Other |
|
5 |
|
|
|
3 |
|
Segment Adjusted EBITDA |
$ |
276 |
|
|
$ |
198 |
|
The Investment in
Segment Adjusted EBITDA. For the three months ended
-
an increase in the gross profit on motor fuel sales of
primarily due to a$75 million 23.6% increase in gross profit per gallon sold and a0.8% increase in gallons sold; and -
an increase in non-motor fuel gross profit of
primarily due to the recent acquisition of refined product terminals, as well as increased credit card transactions and merchandise gross profit; partially offset by$22 million -
an increase in operating expenses and selling, general and administrative expenses of
primarily due to the recent acquisitions of refined product terminals and a transmix processing and terminal facility, higher employee costs, insurance costs and credit card processing fees.$19 million
Investment in USAC |
|||||||
|
Three Months Ended
|
||||||
|
2022 |
|
2021 |
||||
Revenues |
$ |
179 |
|
|
$ |
159 |
|
Cost of products sold |
|
28 |
|
|
|
19 |
|
Segment margin |
|
151 |
|
|
|
140 |
|
Operating expenses, excluding non-cash compensation expense |
|
(31 |
) |
|
|
(31 |
) |
Selling, general and administrative expenses, excluding non-cash compensation expense |
|
(11 |
) |
|
|
(10 |
) |
Segment Adjusted EBITDA |
$ |
109 |
|
|
$ |
99 |
|
The Investment in USAC segment reflects the consolidated results of USAC.
Segment Adjusted EBITDA. For the three months ended
All Other |
|||||||
|
Three Months Ended
|
||||||
|
2022 |
|
2021 |
||||
Revenues |
$ |
1,084 |
|
|
$ |
696 |
|
Cost of products sold |
|
1,052 |
|
|
|
652 |
|
Segment margin |
|
32 |
|
|
|
44 |
|
Unrealized losses on commodity risk management activities |
|
13 |
|
|
|
6 |
|
Operating expenses, excluding non-cash compensation expense |
|
(17 |
) |
|
|
(29 |
) |
Selling, general and administrative expenses, excluding non-cash compensation expense |
|
(11 |
) |
|
|
(13 |
) |
Adjusted EBITDA related to unconsolidated affiliates |
|
2 |
|
|
|
2 |
|
Other and eliminations |
|
11 |
|
|
|
8 |
|
Segment Adjusted EBITDA |
$ |
30 |
|
|
$ |
18 |
|
For the three months ended
-
an increase of
due to a favorable environment for physical gas trading and storage activities;$18 million -
an increase of
due to a favorable environment for our power trading activities; and$12 million -
an increase of
due to higher coal royalties at our natural resources business; partially offset by$6 million -
a decrease of
due to the sale of Energy Transfer Canada.$17 million
|
|||||||
SUPPLEMENTAL INFORMATION ON LIQUIDITY |
|||||||
(In millions) |
|||||||
(unaudited) |
|||||||
The following table summarizes the status of our revolving credit facility. We also have consolidated subsidiaries with revolving credit facilities which are not included in this table. |
|||||||
|
Facility Size |
|
Funds Available at
|
|
Maturity Date |
||
Five-Year Revolving Credit Facility |
$ |
5,000 |
|
$ |
2,317 |
|
|
|
|||||||
SUPPLEMENTAL INFORMATION ON UNCONSOLIDATED AFFILIATES |
|||||||
(In millions) |
|||||||
(unaudited) |
|||||||
The table below provides information on an aggregated basis for our unconsolidated affiliates, which are accounted for as equity method investments in the Partnership’s financial statements for the periods presented. |
|||||||
|
Three Months Ended
|
||||||
|
2022 |
|
2021 |
||||
Equity in earnings (losses) of unconsolidated affiliates: |
|
|
|
||||
Citrus |
$ |
36 |
|
|
$ |
44 |
|
MEP |
|
(1 |
) |
|
|
(5 |
) |
White Cliffs |
|
— |
|
|
|
(1 |
) |
Explorer |
|
8 |
|
|
|
9 |
|
Other |
|
25 |
|
|
|
24 |
|
Total equity in earnings of unconsolidated affiliates |
$ |
68 |
|
|
$ |
71 |
|
|
|
|
|
||||
Adjusted EBITDA related to unconsolidated affiliates: |
|
|
|
||||
Citrus |
$ |
86 |
|
|
$ |
87 |
|
MEP |
|
8 |
|
|
|
4 |
|
White Cliffs |
|
5 |
|
|
|
4 |
|
Explorer |
|
12 |
|
|
|
12 |
|
Other |
|
36 |
|
|
|
34 |
|
Total Adjusted EBITDA related to unconsolidated affiliates |
$ |
147 |
|
|
$ |
141 |
|
|
|
|
|
||||
Distributions received from unconsolidated affiliates: |
|
|
|
||||
Citrus |
$ |
52 |
|
|
$ |
106 |
|
MEP |
|
4 |
|
|
|
1 |
|
White Cliffs |
|
5 |
|
|
|
5 |
|
Explorer |
|
6 |
|
|
|
6 |
|
Other |
|
27 |
|
|
|
20 |
|
Total distributions received from unconsolidated affiliates |
$ |
94 |
|
|
$ |
138 |
|
|
|||||
SUPPLEMENTAL INFORMATION ON NON-WHOLLY-OWNED JOINT VENTURE SUBSIDIARIES |
|||||
(In millions) |
|||||
(unaudited) |
|||||
The table below provides information on an aggregated basis for our non-wholly-owned joint venture subsidiaries, which are reflected on a consolidated basis in our financial statements. The table below excludes |
|||||
|
Three Months Ended
|
||||
|
2022 |
|
2021 |
||
Adjusted EBITDA of non-wholly-owned subsidiaries ( |
$ |
622 |
|
$ |
599 |
Our proportionate share of Adjusted EBITDA of non-wholly-owned subsidiaries (b) |
|
297 |
|
|
299 |
|
|
|
|
||
Distributable Cash Flow of non-wholly-owned subsidiaries ( |
$ |
593 |
|
$ |
556 |
Our proportionate share of Distributable Cash Flow of non-wholly-owned subsidiaries (d) |
|
278 |
|
|
272 |
Below is our ownership percentage of certain non-wholly-owned subsidiaries: | |||||
Non-wholly-owned subsidiary: |
Energy Transfer Percentage Ownership (e) |
||||
Bakken Pipeline |
|
|
|||
|
|
|
|||
|
|
|
|||
Ohio River System |
|
|
|||
|
|
|
|||
Red Bluff Express |
|
|
|||
Rover |
|
|
|||
Others |
various |
(a) |
Adjusted EBITDA of non-wholly-owned subsidiaries reflects the total Adjusted EBITDA of our non-wholly-owned subsidiaries on an aggregated basis. This is the amount included in our consolidated non-GAAP measure of Adjusted EBITDA. |
|
(b) |
Our proportionate share of Adjusted EBITDA of non-wholly-owned subsidiaries reflects the amount of Adjusted EBITDA of such subsidiaries (on an aggregated basis) that is attributable to our ownership interest. |
|
(c) |
Distributable Cash Flow of non-wholly-owned subsidiaries reflects the total Distributable Cash Flow of our non-wholly-owned subsidiaries on an aggregated basis. |
|
(d) |
Our proportionate share of Distributable Cash Flow of non-wholly-owned subsidiaries reflects the amount of Distributable Cash Flow of such subsidiaries (on an aggregated basis) that is attributable to our ownership interest. This is the amount included in our consolidated non-GAAP measure of Distributable Cash Flow attributable to the partners of Energy Transfer. |
|
(e) |
Our ownership reflects the total economic interest held by us and our subsidiaries. In some cases, this percentage comprises ownership interests held in (or by) multiple entities. In addition to the ownership reflected in the table above, the Partnership also owned a |
View source version on businesswire.com: https://www.businesswire.com/news/home/20221101006138/en/
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