(dollars in millions) |
1st Qtr |
1st Qtr |
Change | ||||||
Enterprise Products Partners & EPGP | $ | 48.9 | $ | 42.3 | 15.6 | % | |||
TEPPCO Partners & TEPPCO GP | 18.7 | 16.7 | 12.0 | % | |||||
Energy Transfer Equity & LE GP | 20.7 | 17.2 | 20.3 | % | |||||
Total | $ | 88.3 | $ | 76.2 | 15.9 | % |
Consolidated net income attributable to
“In the first quarter of 2009,
Basis of Presentation of Financial Information
Our Investment in
In accordance with rules and regulations of the
Effective
The consolidated financial statements included in this press release reflect the changes required by SFAS 160. As a result, net income reported for the first quarter of 2008 in these financial statements is higher than that disclosed previously; however, the allocation of such net income results in our unitholders, general partner and noncontrolling interests (i.e., the former minority interest) receiving the same amounts as they did previously. Noncontrolling interest presented in our financial statements reflects third-party and related party ownership of our consolidated subsidiaries, which include the third-party and related party unitholders of
In order for the unitholders of
Use of Non-GAAP Financial Measures
The press release and accompanying schedules include the non-GAAP financial measure of distributable cash flow. Exhibit C provides a reconciliation of this non-GAAP financial measure to its most directly comparable financial measure calculated in accordance with GAAP. Distributable cash flow should not be considered an alternative to GAAP financial measures such as net income, net cash flow provided by operating activities or any other GAAP measure of liquidity or financial performance. We define distributable cash flow as follows:
- Cash distributions expected to be received from the Parent Company’s investments in limited and general partner interests (including related incentive distribution rights, if any, held by these general partners); less the sum of,
- Parent Company general and administrative costs on a standalone basis;
- Parent Company interest expense on a standalone basis, before non-cash amortization; and
- the general and administrative costs, on a standalone basis, of the general partners of
Enterprise Products Partners andTEPPCO .
Distributable cash flow is a significant liquidity metric used by senior management to compare net cash flow generated by the Parent Company’s investments to the cash distributions the Parent Company is expected to pay its partners. Using this metric, senior management can quickly compute the coverage ratio of estimated cash flow to planned cash distributions.
Distributable cash flow is an important non-GAAP financial measure for the Parent Company’s unitholders since it indicates to investors whether or not the Parent Company’s investments are generating cash flow at a level that can sustain or support an increase in quarterly cash distribution levels. Financial metrics such as distributable cash flow are quantitative standards used by the investment community because the value of a partnership unit is in part measured by its yield (which, in turn, is based on the amount of cash distributions a partnership pays to a unitholder).
Company Information and Forward-Looking Statements
This press release contains various forward-looking statements and information that are based on Enterprise GP Holdings’ beliefs and those of its general partner, as well as assumptions made by and information currently available to
- fluctuations in oil, natural gas and natural gas liquid prices and production due to weather and other natural and economic forces;
- the effects of the Related Companies’ debt level on its future financial and operating flexibility;
- a reduction in demand for the Related Companies’ products by the petrochemical, refining, heating or other industries;
- a decline in the volumes delivered by the Related Companies’ facilities;
- the failure of any of the Related Companies’ credit risk management efforts to adequately protect it against customer non-payment;
- terrorist attacks aimed at the Related Companies’ facilities; and
- the failure to successfully integrate the Related Companies’ operations with companies, if any, that they may acquire in the future.
Exhibit A |
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Enterprise GP Holdings L.P. – Parent Company |
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The following table presents distributable cash flow, summarized income statement data and selected balance sheet information for the Parent Company with respect to the periods shown and at the dates indicated. |
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Three Months Ended March 31, | ||||||||||
2009 | 2008 | |||||||||
Cash distributions from investees: (1) | ||||||||||
Enterprise Products Partners and EPGP: | ||||||||||
From common units of Enterprise Products Partners | $ | 7.3 | $ | 6.9 | ||||||
From 2% general partner interest and related IDRs | 41.6 | 35.4 | ||||||||
TEPPCO and TEPPCO GP: | ||||||||||
From common units of TEPPCO | 3.2 | 3.1 | ||||||||
From 2% general partner interest and related IDRs | 15.5 | 13.6 | ||||||||
Energy Transfer Equity and LE GP: | ||||||||||
From common units of Energy Transfer Equity | 20.5 | 17.1 | ||||||||
From member interest in LE GP | 0.2 | 0.1 | ||||||||
Total cash distributions from investees | 88.3 | 76.2 | ||||||||
Cash expenses, primarily Parent Company | (14.4 | ) | (20.5 | ) | ||||||
Distributable cash flow | $ | 73.9 | $ | 55.7 | ||||||
Distributions by Parent Company | $ | 67.5 | $ | 52.4 | ||||||
Parent Company summarized income statement data: | ||||||||||
Equity in earnings of investees (2) | $ | 78.1 | $ | 66.7 | ||||||
General and administrative costs | 2.0 | 2.2 | ||||||||
Operating income | 76.1 | 64.5 | ||||||||
Interest expense, net | (13.2 | ) | (17.9 | ) | ||||||
Net income attributable to Enterprise GP Holdings L.P. | $ | 62.9 | $ | 46.6 | ||||||
Parent Company debt principal outstanding at end of period | $ | 1,070.3 | $ | 1,088.0 | ||||||
|
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(1) |
Represents cash distributions received or, in the case of Energy Transfer Equity for the most recent quarter, declared and scheduled to be received with respect to such quarter. With respect to cash distributions from investees for the first quarter of 2009, we received the distributions shown for Enterprise Products Partners and its general partner on May 8, 2009, and we received the cash distributions from TEPPCO and its general partner on May 7, 2009. The declared distribution from Energy Transfer Equity and its general partner is scheduled to be paid on May 19, 2009. |
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(2) |
Represents the Parent Company’s share of net income of Enterprise Products Partners, TEPPCO, Energy Transfer Equity and their respective general partners. |
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Exhibit B |
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Enterprise GP Holdings L.P. |
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Since the Parent Company owns the general partner of (and therefore controls) Enterprise Products Partners and TEPPCO, our consolidated financial statements include the financial results of Enterprise Products Partners and TEPPCO. The net income of Enterprise Products Partners and TEPPCO allocated to limited partner interests not owned by the Parent Company is allocated to noncontrolling interests. On a consolidated basis, we have three reportable business segments: Investment in Enterprise Products Partners, Investment in TEPPCO and Investment in Energy Transfer Equity. The following table summarizes our financial information by business segment for the periods presented: |
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Three Months Ended March 31, | |||||||||||
2009 | 2008 | ||||||||||
Revenues: | |||||||||||
Investment in Enterprise Products Partners | $ | 3,423.1 | $ | 5,684.5 | |||||||
Investment in TEPPCO | 1,517.0 | 2,866.7 | |||||||||
Eliminations | (53.1 | ) | (44.9 | ) | |||||||
Total revenues | 4,887.0 | 8,506.3 | |||||||||
Costs and expenses: | |||||||||||
Investment in Enterprise Products Partners | 3,064.3 | 5,332.4 | |||||||||
Investment in TEPPCO | 1,399.5 | 2,753.8 | |||||||||
Other, non-segment including Parent Company | (50.2 | ) | (39.7 | ) | |||||||
Total costs and expenses | 4,413.6 | 8,046.5 | |||||||||
Equity in earnings of unconsolidated affiliates: | |||||||||||
Investment in Enterprise Products Partners (1) | 7.2 | 8.9 | |||||||||
Investment in TEPPCO (1) | 0.2 | (1.1 | ) | ||||||||
Investment in Energy Transfer Equity (2) | 17.5 | 12.0 | |||||||||
Total equity in earnings of unconsolidated affiliates | 24.9 | 19.8 | |||||||||
Operating income: | |||||||||||
Investment in Enterprise Products Partners | 366.0 | 361.0 | |||||||||
Investment in TEPPCO | 117.7 | 111.8 | |||||||||
Investment in Energy Transfer Equity | 17.5 | 12.0 | |||||||||
Other, non-segment including Parent Company | (2.9 | ) | (5.2 | ) | |||||||
Total operating income | 498.3 | 479.6 | |||||||||
Interest expense | (165.7 | ) | (148.5 | ) | |||||||
Provision for income taxes | (16.0 | ) | (4.5 | ) | |||||||
Other income, net | 1.2 | 1.5 | |||||||||
Net income | 317.8 | 328.1 | |||||||||
Net income attributable to noncontrolling interest (3) | (254.9 | ) | (281.5 | ) | |||||||
Net income attributable to Enterprise GP Holdings L.P. | $ | 62.9 | $ | 46.6 | |||||||
Allocation of net income to: | |||||||||||
Limited partners | $ | 62.9 | $ | 46.6 | |||||||
General partner |
$ |
* |
$ |
* |
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Earnings per Unit, basic and fully diluted: | |||||||||||
Earnings per Unit | $ | 0.47 | $ | 0.38 | |||||||
Average LP Units outstanding | 133.7 | 123.2 | |||||||||
(1) |
Represents equity earnings from unconsolidated affiliates as recorded by Enterprise Products Partners and TEPPCO. |
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(2) |
Represents the Parent Company’s share of the net income of Energy Transfer Equity and its general partner. |
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(3) |
Represents earnings of Enterprise Products Partners and TEPPCO allocated to their respective limited partner interests not owned by the Parent Company. |
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* Amount is negligible. |
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Exhibit C |
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Enterprise GP Holdings L.P. – Parent Company |
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The following table presents a reconciliation of the Parent Company’s non-GAAP distributable cash flow amounts to GAAP net cash flow provided by operating activities. |
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Three Months Ended March 31, | |||||||||||
2009 | 2008 | ||||||||||
Distributable Cash Flow (Exhibit A) | $ | 73.9 | $ | 55.7 | |||||||
Adjustments to derive net cash flow provided by operating activities (add or subtract as indicated by sign of number): |
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Distributions to be received from investees with respect to period indicated (Exhibit A) (1) |
(88.3 | ) | (76.2 | ) | |||||||
Distributions received from investees during period |
86.0 | 76.0 | |||||||||
Net effect of changes in operating accounts | (1.7 | ) | (4.4 | ) | |||||||
Net cash flow provided by operating activities | $ | 69.9 | $ | 51.1 | |||||||
(1) |
Represents cash distributions collected subsequent to the end of each reporting period. |
Source:
Enterprise GP Holdings L.P.
Randy Burkhalter, 713-381-6812 or 866-230-0745 (Investor Relations)
Rick Rainey, 713-381-3635 (Media Relations)