UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K/A
(Amendment
No. 1)
CURRENT
REPORT
Pursuant
to Section 13 or 15(d)
of the
Securities Exchange Act of 1934
Date of
report (Date of earliest event reported): April 27, 2010
DUNCAN
ENERGY PARTNERS L.P.
(Exact
Name of Registrant as Specified in Its Charter)
|
Delaware
|
1-33266
|
20-5639997
|
|
(State
or Other Jurisdiction of
Incorporation
or Organization)
|
(Commission
File
Number)
|
(I.R.S.
Employer
Identification
No.)
|
|
1100
Louisiana Street, 10th
Floor
Houston,
Texas 77002
(Address
of Principal Executive Offices, including Zip Code)
|
|
(713)
381-6500
(Registrant’s
Telephone Number, including Area
Code)
|
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
¨ 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))
EXPLANATORY
NOTE
The
purpose of this amendment is to provide a corrected final version of the press
release (described in Item 2.02 below) actually issued by Duncan Energy Partners
L.P. on April 27, 2010, which increased the forecast of Duncan Energy Partners’
2010 growth capital expenditures from approximately $420 million to
approximately $475 million.
Item
2.02. Results of Operations and Financial Condition.
On April 27, 2010, Duncan Energy
Partners L.P. (“Duncan Energy Partners”) issued a press release announcing its
financial and operating results for the three months ended March 31, 2010 and
held a webcast conference call discussing those results. A copy of
the earnings press release is furnished as Exhibit 99.1 to this Current Report,
which is hereby incorporated by reference into this Item 2.02. The
webcast conference call will be archived and available for replay on Duncan
Energy Partners’ website at www.deplp.com for 90
days.
Unless
the context requires otherwise, references to “we,” “us,” “our,” “Duncan Energy
Partners” or the “Partnership” within the context of this Current Report refer
to the business and operations of Duncan Energy Partners L.P. and its
consolidated subsidiaries. References to “Parent” and “EPO” refer to
Enterprise Products Operating LLC, which is the primary operating subsidiary of
Enterprise Products Partners L. P. (“Enterprise”).
Supplemental
Selected Standalone Financial Information
In
February 2007, associated with its initial public offering, Duncan Energy
Partners acquired controlling ownership interests in five midstream energy
companies (the “DEP I Midstream Businesses”) from Enterprise in a drop down
transaction. In December 2008, Duncan Energy Partners acquired
controlling ownership interests in three additional midstream energy companies
(the “DEP II Midstream Businesses”) from Enterprise in a second drop down
transaction.
To assist
investors and other users of our financial statements, our press release
includes selected financial information on a standalone basis apart from that of
our consolidated Partnership. A key difference between the
supplemental selected standalone financial information and our general purpose
consolidated financial statements is that the DEP I and DEP II Midstream
Businesses (i.e., the partnership’s operating subsidiaries) are viewed as
investments and presented as unconsolidated affiliates. Accordingly,
the net income of the DEP I and DEP II Midstream Businesses attributable to the
Partnership on a standalone basis is reflected as equity earnings. In
accordance with U.S. generally accepted accounting principles (“GAAP”), we
eliminate such equity earnings in the preparation of our general purpose
consolidated financial statements.
Use
of Non-GAAP financial measures
Our press release and/or the webcast
conference call discussion include the non-generally accepted accounting
principle (“non-GAAP”) financial measures of gross operating margin and
distributable cash flow. The press release provides reconciliations
of these non-GAAP financial measures to their most directly comparable financial
measures calculated and presented in accordance with GAAP. Our
non-GAAP financial measures should not be considered as alternatives to GAAP
measures such as net income, operating income, net cash flows provided by
operating activities or any other measure of financial performance or liquidity
calculated and presented in accordance with GAAP. Our non-GAAP
financial measures may not be comparable to similarly-titled measures of other
companies because they may not calculate such measures in the same manner as we
do.
Gross
operating margin. We evaluate segment performance based on the
non-GAAP financial measure of gross operating margin. Gross operating
margin (either in total or by individual segment) is an important performance
measure of the core profitability of our operations. This measure
forms the basis of our internal financial reporting and is used by management in
deciding how to allocate capital resources among business
segments. We believe that investors benefit from having access to the
same financial measures that management uses in evaluating segment
results. The GAAP financial measure most directly comparable to total
segment gross operating margin is operating income.
1
We define
total segment gross operating margin as operating income before:
(i) depreciation, amortization and accretion expense; (ii) non-cash
consolidated asset impairment charges; (iii) gains and losses from asset
sales and related transactions; and (iv) general and administrative
costs. Gross operating margin by segment is calculated by subtracting
segment operating costs and expenses (net of the adjustments noted above) from
segment revenues, with both segment totals before the elimination of any
intersegment and intrasegment transactions. In accordance with GAAP,
intercompany accounts and transactions are eliminated in
consolidation. Gross operating margin is exclusive of other income
and expense transactions, provision for income taxes, extraordinary charges and
the cumulative effect of changes in accounting principles. Gross
operating margin is presented on a 100% basis before the allocation of earnings
to noncontrolling interests.
Distributable
cash flow. The Partnership’s distributable cash flow is a
useful non-GAAP measure of liquidity that approximates the amount of cash that
Duncan Energy Partners could pay its partners each period. We define
the partnership’s distributable cash flow as the sum of its share of the
distributable cash flow of each of the DEP I and DEP II Midstream Businesses,
less any standalone expenses of the Partnership such as interest expense and
general and administrative costs (net of non-cash items).
In general, we define the distributable
cash flow of our operating subsidiaries as their net income or loss adjusted
for:
|
§
|
the
addition of depreciation, amortization and accretion
expense;
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§
|
the
addition of cash distributions received from Evangeline, if any, less
equity earnings;
|
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§
|
the
subtraction of sustaining capital expenditures and cash payments to settle
asset retirement obligations;
|
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§
|
the
addition of losses or subtraction of gains relating to asset sales and
related transactions;
|
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§
|
the
addition of cash proceeds from asset sales and related
transactions;
|
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§
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the
addition of losses or subtraction of gains from the monetization of
derivative instruments recorded in accumulated other comprehensive income
(loss), if any, less related amortization of such amounts to earnings;
and
|
|
§
|
the
addition or subtraction of other miscellaneous non-cash amounts (as
applicable) that affect net income or loss for the
period.
|
Sustaining capital expenditures are
capital expenditures (as defined by GAAP) resulting from improvements to and
major renewals of existing assets. Such expenditures do not generate
additional revenues.
Management compares our distributable
cash flow to the cash distributions we expect to pay our
partners. Using this data, management computes our distribution
coverage ratio. Distributable cash flow is also a quantitative
standard used by the investment community with respect to publicly traded
partnerships because the value of a partnership unit is in part measured by its
yield, which is based on the amount of cash distributions a partnership pays to
a unitholder. The GAAP measure most directly comparable to
distributable cash flow is net cash flows provided by operating
activities.
2
Item
9.01. Financial Statements and
Exhibits.
(d) Exhibits.
| Exhibit No. | Description |
| 99.1 | Duncan Energy Partners L.P. press release dated April 27, 2010. |
3
SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this Current
Report to be signed on its behalf by the undersigned hereunto duly
authorized.
|
DUNCAN
ENERGY PARTNERS L.P.
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||
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By:
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DEP
Holdings, LLC, as general partner
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Date:
April 27, 2010
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By:
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/s/
Michael J.
Knesek
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Name:
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Michael
J. Knesek
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Title:
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Senior
Vice President, Controller
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and
Principal Accounting Officer
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||
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of
DEP Holdings, LLC
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4
Exhibit
Index
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Exhibit No.
|
Description
|
|
99.1
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Duncan
Energy Partners L.P. press release dated April 27,
2010.
|
5
Exhibit
99.1
P.O. Box
4324
Houston,
TX 77210
(713)
381-6500
Duncan
Energy Partners Reports Solid Results
For
First Quarter 2010
Houston,
Texas (April 27, 2010) – Duncan Energy Partners L.P. (NYSE: DEP) today announced
its financial and operating results for the three months ended March 31,
2010. Net income attributable to Duncan Energy Partners for the first
quarter of 2010 was $21.2 million, or $0.37 per common unit on a fully diluted
basis, compared to $19.9 million, or $0.34 per common unit on a fully diluted
basis, for the first quarter of 2009.
The
partnership’s distributable cash flow increased to $32.0 million for the first
quarter of 2010 from $29.5 million for the first quarter of 2009. The
DEP II Midstream Businesses contributed $22.1 million of distributable cash flow
for the first quarter of 2010 compared to $21.6 million of distributable cash
flow generated in the first quarter of 2009.
On April
13, 2010, the Board of Directors of Duncan Energy Partners’ general partner
declared an increase in the partnership’s quarterly cash distribution rate with
respect to the first quarter of 2010 to $0.4475 per common unit, or $1.79 per
unit on an annualized basis. This represents the partnership’s sixth
consecutive quarterly distribution increase and a 4.1 percent increase over the
$0.43 per unit that was paid with respect to the first quarter of
2009. The partnership’s share of distributable cash flow for the
first quarter of 2010 provides 1.2 times coverage of the cash distribution to be
paid on May 6, 2010 to its partners of record on April 30, 2010. The
partnership retained $6 million of distributable cash flow in the first quarter
of 2010 that can be used to fund growth capital projects and reduce
debt. Distributable cash flow is a non-generally accepted accounting
principle (“non-GAAP”) financial liquidity measure that is defined and
reconciled later in this press release to its most directly comparable U.S. GAAP
financial measure, which is net cash flows provided by operating
activities.
“Our
partnership is off to a good start in 2010, supported by higher gross operating
margin from our natural gas and NGL businesses,” said W. Randall Fowler,
president and chief executive officer of the general partner of Duncan Energy
Partners L.P. “Higher transportation and storage fees contributed to
the 16 percent increase in gross operating margin this quarter compared to the
first quarter of last year. Our attractive portfolio of integrated
pipeline and storage assets has consistently generated stable, fee-based cash
flows that support our quarterly cash distributions,” said Fowler.
Review of Segment Quarterly
Performance
Since
Duncan Energy Partners consolidates the financial results of its controlled
operating subsidiaries, the following discussion of segment results reports
gross operating margin and volumes on a 100 percent basis, even though the
partnership owns less than 100 percent of these businesses. Gross operating
margin is a non-GAAP financial performance measure that is defined and
reconciled later in this press release to its most directly comparable GAAP
financial measure, which is operating income.
Natural Gas Pipelines &
Services – Gross operating margin for the first quarter of 2010 increased
10 percent to $42.5 million compared to $38.8 million for the first quarter of
2009. Gross operating margin from the Texas Intrastate System for the
first quarter of 2010 was $2.1 million higher than that recorded for the first
quarter of 2009. This increase is primarily due to higher firm
capacity reservation fees of $15.7 million attributable to the Sherman Extension
pipeline and increased condensate sales revenue of $1.8 million due to higher
commodity prices,
1
both of which
were partially offset by a $10.3 million decrease in revenues from lower
throughput volumes on the South Texas portion of the Texas Intrastate System and
a $5.8 million increase in operating expenses. Increased natural gas
throughput volumes on the Acadian Pipeline System and higher firm storage
reservation fees from the partnership’s Wilson natural gas storage facility
combined for a $1.3 million increase in gross operating margin for the first
quarter of 2010 versus the first quarter of 2009.
Total
natural gas throughput volumes averaged 4.5 trillion British thermal units per
day (“TBtud”) in the first quarter of 2010 compared to 4.8 TBtud in the first
quarter of 2009.
NGL Pipelines & Services –
Gross operating margin for the first quarter of 2010 increased to $26.9 million
from $20.8 million for the first quarter of 2009. Net of operational
measurement gains and losses associated with the partnership’s Mont Belvieu NGL
and petrochemical storage facility that are allocated to Enterprise Products
Partners L.P. (“Enterprise”) through noncontrolling interest, gross operating
margin increased 18 percent to $26.0 million for the first quarter of 2010 from
$22.1 million for the first quarter of 2009. This increase in gross
operating margin was primarily due to higher revenues attributable to increased
storage fees and volumes at the partnership’s complex in Mont Belvieu,
Texas.
NGL
transportation volumes increased to 120 thousand barrels per day (“MBPD”) in the
first quarter of 2010 from 115 MBPD in the first quarter of 2009. NGL
fractionation volumes also increased this quarter to 82 MBPD from 79 MBPD in the
first quarter of 2009.
Petrochemical Services – Gross
operating margin reported for the first quarter of 2010 was $2.4 million
compared to $2.5 million reported in the first quarter of 2009. Total
petrochemical transportation volumes increased 41 percent to 31 MBPD for the
first quarter of 2010 from 22 MBPD for the first quarter of 2009, primarily due
to higher volumes transported on the Lou-Tex propylene
pipeline. Increased revenues from the Lou-Tex propylene pipeline as a
result of increased transportation volumes were offset by lower revenues on the
Sabine propylene pipeline.
Capitalization
Total
debt principal outstanding at March 31, 2010 was $457 million. At
March 31, 2010, Duncan Energy Partners had total liquidity of approximately $135
million, including cash and availability under the partnership’s $300 million
revolving credit facility.
Duncan
Energy Partners’ growth capital expenditures for 2010 are estimated to be
approximately $475 million. This estimate includes amounts related to the
partnership’s 66 percent ownership interest in the Haynesville Extension of the
Acadian Gas Pipeline System, which is expected to be completed in the third
quarter of 2011, and the conversion of two NGL storage caverns at the
partnership’s Mont Belvieu storage facility to refined product service, which is
expected to be completed in the fourth quarter of 2010. The total expected
cost of the 270-mile Haynesville Extension pipeline project is approximately
$1.56 billion including capitalized interest, of which Duncan Energy Partners’
66 percent share of the project is $1.03 billion.
Supplemental Selected
Standalone Financial Information
In
February 2007, associated with its initial public offering, Duncan Energy
Partners acquired controlling ownership interests in five midstream energy
companies (the “DEP I Midstream Businesses”) from Enterprise in a drop down
transaction. In December 2008, Duncan Energy Partners acquired
controlling ownership interests in three additional midstream energy companies
(the “DEP II Midstream Businesses”) from Enterprise in a second drop down
transaction.
To assist
investors and other users of our financial statements, Exhibit A to this press
release includes selected financial information of Duncan Energy Partners L.P.
on a standalone basis apart from that of our consolidated partnership financial
information. A key difference between the supplemental selected
standalone financial information and our general purpose consolidated financial
statements is that the DEP I and DEP II
2
Midstream Businesses (i.e., the
partnership’s operating subsidiaries) are viewed as investments and presented as
unconsolidated affiliates by Duncan Energy Partners L.P. on a standalone
basis.
Use of Non-GAAP Financial
Measures
This
press release includes the non-GAAP financial measures of gross operating margin
and distributable cash flow. The exhibits accompanying this press
release provide reconciliations of these non-GAAP financial measures to their
most directly comparable financial measures calculated and presented in
accordance with GAAP. Our non-GAAP financial measures should not be
considered as alternatives to GAAP measures such as net income, operating
income, net cash flows provided by operating activities or any other GAAP
measure of financial performance or liquidity. Our non-GAAP financial
measures may not be comparable to similarly-titled measures of other companies
because they may not calculate such measures in the same manner as we
do.
Gross
operating margin. We evaluate segment performance based on the
non-GAAP financial measure of gross operating margin. Gross operating
margin (either in total or by individual segment) is an important performance
measure of the core profitability of our operations. This measure
forms the basis of our internal financial reporting and is used by management in
deciding how to allocate capital resources among business
segments. We believe that investors benefit from having access to the
same financial measures that management uses in evaluating segment
results. The GAAP financial measure most directly comparable to total
segment gross operating margin is operating income.
We define
total segment gross operating margin as operating income before: (i)
depreciation, amortization and accretion expense; (ii) non-cash consolidated
asset impairment charges; (iii) gains and losses from asset sales and related
transactions; and (iv) general and administrative costs. Gross
operating margin by segment is calculated by subtracting segment operating costs
and expenses (net of the adjustments noted above) from segment revenues, with
both segment totals before the elimination of any intersegment and intrasegment
transactions. In accordance with GAAP, intercompany accounts and
transactions are eliminated in consolidation. Gross operating margin
is exclusive of other income and expense transactions, provision for income
taxes, extraordinary charges and the cumulative effect of changes in accounting
principles. Gross operating margin is presented on a 100 percent
basis before the allocation of earnings to noncontrolling
interests.
Distributable
cash flow. The partnership’s distributable cash flow is a
useful non-GAAP measure of liquidity that approximates the amount of cash that
Duncan Energy Partners could pay its partners each period. We define
the partnership’s distributable cash flow as the sum of its share of the
distributable cash flow of each of the DEP I and DEP II Midstream Businesses,
less any standalone expenses of the partnership such as interest expense and
general and administrative costs (net of non-cash items).
In
general, we define the distributable cash flow of our operating subsidiaries as
their net income or loss adjusted for:
|
§
|
the
addition of depreciation, amortization and accretion
expense;
|
|
§
|
the
addition of cash distributions received from Evangeline, if any, less
equity earnings;
|
|
§
|
the
subtraction of sustaining capital expenditures and cash payments to settle
asset retirement
obligations;
|
|
§
|
the
addition of losses or subtraction of gains relating to asset sales and
related transactions;
|
|
§
|
the
addition of cash proceeds from asset sales and related
transactions;
|
|
§
|
the
addition of losses or subtraction of gains from the monetization of
derivative instruments recorded in accumulated other comprehensive income
(loss), if any, less related amortization of such amounts to earnings;
and
|
|
§
|
the
addition or subtraction of other miscellaneous non-cash amounts (as
applicable) that affect net income or loss for the
period.
|
Sustaining
capital expenditures are capital expenditures (as defined by GAAP) resulting
from improvements to and major renewals of existing assets. Such
expenditures do not generate additional revenues.
3
Management
compares our distributable cash flow to the cash distributions we expect to pay
our partners. Using this data, management computes our distribution
coverage ratio. Distributable cash flow is also a quantitative
standard used by the investment community with respect to publicly traded
partnerships because the value of a partnership unit is in part measured by its
yield, which is based on the amount of cash distributions a partnership pays to
a unitholder. The GAAP measure most directly comparable to
distributable cash flow is net cash flows provided by operating
activities.
First Quarter 2010 Earnings
Conference Call
Management
for Duncan Energy Partners will discuss first quarter 2010 results with analysts
and investors in a conference call scheduled for 10:30 a.m. CDT
today. The call will be broadcast live over the Internet and may be
accessed by visiting the partnership’s website at www.deplp.com.
Company Information and Use
of Forward Looking Statements
Duncan
Energy Partners is a publicly traded partnership that provides midstream energy
services, including gathering, transportation, marketing and storage of natural
gas, in addition to NGL fractionation (or separation), transportation and
storage and petrochemical transportation and storage. Duncan Energy
Partners owns interests in assets located primarily in Texas and Louisiana,
including interests in approximately 9,400 miles of natural gas pipelines with a
transportation capacity aggregating approximately 7.9 billion cubic feet (“Bcf”)
per day; more than 1,600 miles of NGL and petrochemical pipelines featuring
access to the world’s largest fractionation complex at Mont Belvieu, Texas; two
NGL fractionation facilities located in south Texas; approximately 18 million
barrels (“MMBbls”) of leased NGL storage capacity; 8.5 Bcf of leased natural gas
storage capacity; and 34 underground salt dome caverns with more than 100 MMBbls
of NGL storage capacity at Mont Belvieu. Duncan Energy Partners is
managed by its general partner, DEP Holdings, LLC, which is a wholly-owned
subsidiary of Enterprise. Additional information about Duncan Energy
Partners is available online at www.deplp.com.
This news
release includes forward-looking statements. Except for the
historical information contained herein, the matters discussed in this news
release are forward-looking statements that involve certain risks and
uncertainties, such as the partnership’s expectations regarding future results,
capital expenditures, project completions, liquidity and financial market
conditions. These risks and uncertainties include, among other
things, insufficient cash from operations, market conditions, governmental
regulations and factors discussed in the partnership’s filings with the U.S.
Securities and Exchange Commission. If any of these risks or
uncertainties materializes, or should underlying assumptions prove incorrect,
actual results or outcomes may vary materially from those
expected. The partnership disclaims any intention or obligation to
update publicly or reverse such statements, whether as a result of new
information, future events or otherwise.
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Contacts:
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Randy
Burkhalter, Investor Relations, (713) 381-6812 or (866)
230-0745
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Rick
Rainey, Media Relations, (713)
381-3635
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###
4
Exhibit
A
Duncan
Energy Partners L.P.
Supplemental
Standalone Financial Information - UNAUDITED
For
the Three Months Ended March 31, 2010 and 2009
(Amounts
in millions, except per unit amounts)
The following table summarizes the
distributable cash flow (“DCF”) and related coverage ratio calculations for
Duncan Energy Partners on a standalone basis. The line item captioned
“Duncan Energy Partners L.P. standalone expenses, net of non-cash items”
primarily represents accrued interest expense and general and administrative
costs of the partnership itself, exclusive of any such amounts attributed to the
DEP I and DEP II Midstream Businesses. We calculate the distribution
coverage ratio by dividing “Distributable cash flow, net to limited partners” by
the average number of distribution-bearing units outstanding, and further by the
declared distribution rate per unit for the period indicated.
In addition, the following table
presents selected income statement and balance sheet data of Duncan Energy
Partners L.P. on a standalone basis. Duncan Energy Partners L.P.
currently has no operations apart from its investments in the DEP I and DEP II
Midstream Businesses. For purposes of this presentation, we have
listed amounts pertaining to the DEP I Midstream Businesses apart from those
relating to the DEP II Midstream Businesses.
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Three
Months
|
||||||||
|
Ended
March 31,
|
||||||||
|
2010
|
2009
|
|||||||
|
Distributable
cash flow summary:
|
||||||||
|
DEP
share of the DCF attributable to the:
|
||||||||
|
DEP
I Midstream Businesses
|
$ | 12.9 | $ | 11.9 | ||||
|
DEP
II Midstream Businesses
|
22.1 | 21.6 | ||||||
|
Duncan
Energy Partners L.P. standalone expenses, net of non-cash
items
|
(3.0 | ) | (4.0 | ) | ||||
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Total
Duncan Energy Partners L.P. distributable cash flow
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32.0 | 29.5 | ||||||
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Less: Distributions
to our general partner
|
(0.2 | ) | (0.2 | ) | ||||
|
Distributable
cash flow, net to limited partners
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$ | 31.8 | $ | 29.3 | ||||
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Average
distribution-bearing units outstanding
|
57.7 | 57.7 | ||||||
|
Distributable
cash flow coverage:
|
||||||||
|
Declared
distribution rate per unit
|
$ | 0.4475 | $ | 0.4300 | ||||
|
Distribution
coverage ratio
|
1.23 | x | 1.18 | x | ||||
|
Selected
income statement information:
|
||||||||
|
Equity
earnings - DEP I Midstream Businesses
|
$ | 10.3 | $ | 8.4 | ||||
|
Equity
earnings - DEP II Midstream Businesses
|
$ | 14.6 | $ | 15.4 | ||||
|
General
and administrative costs
|
$ | 0.6 | $ | 0.1 | ||||
|
Interest
expense
|
$ | 3.1 | $ | 3.8 | ||||
|
Net
income attributable to Duncan Energy Partners L.P.
|
$ | 21.2 | $ | 19.9 | ||||
|
Selected
balance sheet information at each period end:
|
||||||||
|
Investment
in DEP I Midstream Businesses
|
$ | 512.5 | $ | 505.4 | ||||
|
Investment
in DEP II Midstream Businesses
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$ | 702.4 | $ | 729.8 | ||||
|
Total
debt principal outstanding at end of period
|
$ | 457.3 | $ | 470.3 | ||||
|
Partners’
equity
|
$ | 759.5 | $ | 762.2 | ||||
5
Exhibit
B
Duncan
Energy Partners L.P.
Statements
of Consolidated Operations – UNAUDITED
For
the Three Months Ended March 31, 2010 and 2009
(Dollars
in millions, except per unit amounts)
|
Three
Months
|
||||||||
|
Ended
March 31,
|
||||||||
|
2010
|
2009
|
|||||||
|
Revenue
|
$ | 290.6 | $ | 256.8 | ||||
|
Costs and expenses:
|
||||||||
|
Operating
costs and expenses
|
267.2 | 239.4 | ||||||
|
General
and administrative costs
|
4.9 | 2.8 | ||||||
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Total
costs and expenses
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272.1 | 242.2 | ||||||
|
Equity in income of
Evangeline
|
0.2 | 0.2 | ||||||
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Operating income
|
18.7 | 14.8 | ||||||
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Other income (expense):
|
||||||||
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Interest
expense
|
(3.1 | ) | (3.8 | ) | ||||
|
Interest
income
|
-- | 0.1 | ||||||
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Total
other expense
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(3.1 | ) | (3.7 | ) | ||||
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Income before income taxes
|
15.6 | 11.1 | ||||||
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Benefit
from (provision for) income taxes
|
0.1 | (0.1 | ) | |||||
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Net income
|
15.7 | 11.0 | ||||||
|
Net
loss (income) attributable to noncontrolling interest:
|
||||||||
|
DEP
I Midstream Businesses - Parent
|
(4.7 | ) | (1.6 | ) | ||||
|
DEP
II Midstream Businesses - Parent
|
10.2 | 10.5 | ||||||
|
Total net loss attributable to noncontrolling interest
|
5.5 | 8.9 | ||||||
|
Net income attributable to Duncan Energy
Partners
|
$ | 21.2 | $ | 19.9 | ||||
|
Allocation of net income to Duncan Energy
Partners:
|
||||||||
|
Limited
partners
|
$ | 21.0 | $ | 19.8 | ||||
|
General
partner
|
$ | 0.2 | $ | 0.1 | ||||
|
Per unit data (fully
diluted):
|
||||||||
|
Earnings
per unit
|
$ | 0.37 | $ | 0.34 | ||||
|
Average
LP units outstanding (in millions)
|
57.7 | 57.7 | ||||||
|
Other financial data:
|
||||||||
|
Net
cash flows provided by operating activities
|
$ | 107.1 | $ | 19.8 | ||||
|
Net
cash used in investing activities
|
$ | 115.3 | $ | 115.0 | ||||
|
Net
cash provided by financing activities
|
$ | 26.0 | $ | 104.0 | ||||
|
Distributable
cash flow (see Exhibit A)
|
$ | 32.0 | $ | 29.5 | ||||
|
Depreciation,
amortization and accretion (100% basis)
|
$ | 48.2 | $ | 45.0 | ||||
|
Total
debt principal outstanding at end of period
|
$ | 457.3 | $ | 470.3 | ||||
6
Exhibit
C
Duncan
Energy Partners L.P.
Selected
Financial & Operating Data – UNAUDITED
For
the Three Months Ended March 31, 2010 and 2009
(Dollars
in millions, operating data as noted)
|
Three
Months
|
||||||||
|
Ended
March 31,
|
||||||||
|
2010
|
2009
|
|||||||
|
Gross operating margin by
segment:
|
||||||||
|
Natural
Gas Pipelines & Services
|
$ | 42.5 | $ | 38.8 | ||||
|
NGL
Pipelines & Services
|
26.9 | 20.8 | ||||||
|
Petrochemical
Services
|
2.4 | 2.5 | ||||||
|
Total
gross operating margin
|
71.8 | 62.1 | ||||||
|
Adjustments
to reconcile non-GAAP gross operating margin to GAAP operating
income:
|
||||||||
|
Amounts
in operating costs and expenses:
|
||||||||
|
Depreciation,
amortization and accretion
|
(47.6 | ) | (44.6 | ) | ||||
|
Gain
from asset sales and related transactions
|
0.9 | 0.1 | ||||||
|
Non-cash
asset impairment charges
|
(1.5 | ) | -- | |||||
|
General
and administrative costs
|
(4.9 | ) | (2.8 | ) | ||||
|
Operating
income
|
$ | 18.7 | $ | 14.8 | ||||
|
Selected operating data:
|
||||||||
|
Natural
Gas Pipelines & Services:
|
||||||||
|
Natural
gas throughput volumes, net (BBtus/d)
|
4,465 | 4,801 | ||||||
|
NGL
Pipelines & Services:
|
||||||||
|
Pipeline
throughput volumes (MBPD)
|
120 | 115 | ||||||
|
Fractionation
volumes (MBPD)
|
82 | 79 | ||||||
|
Petrochemical
Services:
|
||||||||
|
Petrochemical
transportation volumes (MBPD)
|
31 | 22 | ||||||
|
Components of net loss (income)
attributable to noncontrolling
interest:
|
||||||||
|
DEP
I Midstream Businesses - Parent:
|
||||||||
|
Mont
Belvieu Caverns
|
$ | (2.8 | ) | $ | 0.3 | |||
|
Acadian
Gas
|
(0.3 | ) | (0.2 | ) | ||||
|
Lou-Tex
Propylene
|
(0.4 | ) | (0.3 | ) | ||||
|
Sabine
Propylene
|
(0.1 | ) | (0.3 | ) | ||||
|
South
Texas NGL
|
(1.1 | ) | (1.1 | ) | ||||
|
Total
DEP I Midstream Businesses - Parent
|
(4.7 | ) | (1.6 | ) | ||||
|
DEP
II Midstream Businesses - Parent:
|
||||||||
|
Enterprise
Texas
|
5.6 | 6.5 | ||||||
|
Enterprise
Intrastate
|
1.2 | 1.7 | ||||||
|
Enterprise
GC
|
3.4 | 2.3 | ||||||
|
Total
DEP II Midstream Businesses - Parent
|
10.2 | 10.5 | ||||||
|
Total
net loss attributable to noncontrolling interest
|
$ | 5.5 | $ | 8.9 | ||||
7
Exhibit
D
Duncan
Energy Partners L.P.
Reconciliation
of DCF to Net Cash Flows Provided by Operating Activities -
UNAUDITED
For
the Three Months Ended March 31, 2010 and 2009
(Dollars
in millions)
|
Three
Months
|
||||||||
|
Ended
March 31,
|
||||||||
|
2010
|
2009
|
|||||||
|
Total
Duncan Energy Partners L.P. distributable cash flow
|
$ | 32.0 | $ | 29.5 | ||||
|
Adjustments
to non-GAAP distributable cash flow to derive GAAP net cash flows
provided by operating activities
|
||||||||
|
(add
or subtract as indicated by sign of number):
|
||||||||
|
Proceeds
from asset sales and related transactions
|
(2.0 | ) | (0.1 | ) | ||||
|
Sustaining
capital expenditures:
|
||||||||
|
DEP
I Midstream Businesses
|
4.4 | 2.5 | ||||||
|
DEP
II Midstream Businesses
|
6.7 | 7.9 | ||||||
|
Other
sustaining capital expenditures
|
-- | 0.1 | ||||||
|
Noncontrolling
interest share of distributable cash flow of
operating subsidiaries:
|
||||||||
|
DEP
I Midstream Businesses - Parent
|
7.5 | 4.7 | ||||||
|
DEP
II Midstream Businesses - Parent
|
15.4 | 10.9 | ||||||
|
Other
|
-- | (0.1 | ) | |||||
|
Net
effect of changes in operating accounts
|
43.1 | (35.6 | ) | |||||
|
Net
cash flows provided by operating activities
|
$ | 107.1 | $ | 19.8 | ||||
8