10-KPeriod: FY2015

ENTERPRISE PRODUCTS PARTNERS L.P. Annual Report, Year Ended Dec 31, 2015

Filed February 26, 2016For Securities:EPDEPDU

Summary

Enterprise Products Partners L.P. (EPD) presented its 2015 Annual Report (10-K) on February 25, 2016. The report details a strong year of strategic growth and asset development despite a challenging commodity price environment. EPD operates as a leading North American provider of midstream energy services, with a vast network of pipelines and storage facilities. The company's business strategy focuses on leveraging its integrated asset base to capitalize on expected demand growth, maintaining a diversified portfolio, enhancing cash flow stability through fee-based businesses, and managing risks via joint ventures. Key developments during 2015 included significant capital expenditures for growth projects, the acquisition of EFS Midstream, and the sale of its Offshore Business. The company highlighted its robust liquidity and its ability to access capital markets, positioning it well for continued investment and distribution growth.

Financial Highlights

43 data points
Beta

Revenue

$27.03B

27.4% Gross Margin

Net Income

$2.52B

9.3% Net Margin

Total Assets

$48.80B

Cash & Equivalents

$19.00M

Free Cash Flow

$171.70M

Financial Statements
Beta
Revenue$27.03B
Cost of Revenue$19.61B
Gross Profit$7.42B
Operating Expenses$23.86B
Operating Income$3.54B
Interest Expense$961.80M
Net Income$2.52B
Shares Outstanding (Diluted)2.00B

Key Highlights

  • 1EPD is a leading North American midstream energy services provider with approximately 49,000 miles of pipelines and extensive storage capacity.
  • 2The company's business strategy emphasizes growth capital projects, accretive acquisitions, fee-based businesses, and joint ventures to enhance stability and capitalize on demand.
  • 3In 2015, EPD completed significant expansion projects, including the Aegis Ethane Pipeline and enhancements to the Houston Ship Channel LPG Export Terminal.
  • 4EPD acquired EFS Midstream for approximately $2.1 billion, strengthening its position in the Eagle Ford Shale.
  • 5The company completed the sale of its Offshore Business for approximately $1.53 billion, allowing for capital redeployment.
  • 6EPD generated substantial distributable cash flow, demonstrating its ability to fund capital expenditures and distributions to unitholders.
  • 7The company noted the lifting of the crude oil export ban in December 2015 as a positive development creating new business opportunities.

Frequently Asked Questions

Key strategic achievements in 2015 included the significant acquisition of EFS Midstream, the sale of the Offshore Business, the completion of major expansion projects like the Aegis Ethane Pipeline and the Houston Ship Channel LPG Export Terminal expansion, and initial services related to crude oil exports following the lifting of the export ban.

While lower commodity prices impacted revenues, particularly in marketing activities, EPD's midstream services, which are often fee-based and supported by long-term contracts, provided a stable revenue stream and mitigated the full impact of price volatility on its overall financial performance. The company's strategy to focus on fee-based contracts and integrated asset network helped maintain stable gross operating margins across its segments.

EPD projected capital spending of approximately $3.8 billion to $4.1 billion for 2016, including a final installment for the EFS Midstream acquisition and expenditures for projects such as the ethane export terminal and new natural gas processing plants in the Delaware Basin. Management expects these investments to support continued growth and capitalize on favorable midstream market conditions.

EPD maintains a robust liquidity position, with significant borrowing capacity under its revolving credit facilities. The company manages its financial risk through a diversified business model, long-term fee-based contracts, and strategic use of derivative instruments to hedge commodity price and interest rate exposures. The company also focuses on maintaining a strong balance sheet to support its growth strategy and capital allocation.