10-QPeriod: Q1 FY2014

ENTERPRISE PRODUCTS PARTNERS L.P. Quarterly Report for Q1 Ended Mar 31, 2014

Filed May 9, 2014For Securities:EPDEPDU

Summary

Enterprise Products Partners L.P. (EPD) reported solid financial results for the first quarter of 2014, with revenues increasing by 13% to $12.91 billion compared to the same period in 2013. This growth was primarily driven by higher sales volumes and prices in NGL marketing, alongside strong performance in natural gas and crude oil marketing, and contributions from newly operational assets like the ATEX Pipeline. Net income attributable to limited partners rose to $798.8 million from $753.5 million in the prior year's quarter. The company's strategic investments in infrastructure, including the ATEX pipeline and expansions of its LPG export terminal, are beginning to contribute positively to operational performance. EPD also managed its debt effectively, issuing new notes and maintaining compliance with financial covenants, positioning the company for continued growth and distribution to its unitholders.

Financial Highlights

41 data points
Beta

Revenue

$12.91B

14.4% Gross Margin

Net Income

$798.80M

6.2% Net Margin

Total Assets

$40.99B

Cash & Equivalents

$988.40M

Free Cash Flow

$704.40M

Financial Statements
Beta
Revenue$12.91B
Cost of Revenue$11.05B
Gross Profit$1.86B
Operating Expenses$11.93B
Operating Income$1.03B
Interest Expense$220.90M
Net Income$798.80M
Shares Outstanding (Diluted)1.88B

Key Highlights

  • 1Revenue increased by 13% to $12.91 billion for Q1 2014, driven by NGL, natural gas, and crude oil marketing segments.
  • 2Net income attributable to limited partners grew to $798.8 million, up from $753.5 million in Q1 2013, indicating improved profitability.
  • 3Operational expansion continues with the ATEX Pipeline commencing operations, contributing $30.7 million in gross operating margin in its first quarter.
  • 4The company reported strong cash flow from operations, reaching $1.40 billion for the quarter, a significant increase from $1.00 billion in the prior year.
  • 5EPD issued new debt securities in February 2014 ($850 million of 3.90% senior notes and $1.15 billion of 5.10% senior notes) to repay existing debt and for general corporate purposes.
  • 6Significant capital expenditures of $980.1 million were made in Q1 2014, primarily for pipeline projects and investments in unconsolidated affiliates.
  • 7The company is advancing plans for a new ethane export facility on the Texas Gulf Coast, expected to be operational by Q3 2016, addressing growing U.S. ethane production.

Frequently Asked Questions

Enterprise Products Partners L.P. reported total revenues of $12.91 billion for the three months ended March 31, 2014, an increase of approximately 13% from $11.38 billion in the same period of 2013. This growth was mainly attributed to higher NGL marketing revenues, increased natural gas marketing revenues due to higher prices, and a rise in crude oil marketing revenues driven by higher sales volumes.

EPD expects total capital spending for 2014 to be in the range of $4.0 billion to $4.4 billion, including sustaining capital. Major growth projects in progress include expansions of crude oil pipelines, the ATEX pipeline, and plans for a new ethane export facility on the Texas Gulf Coast. The company remains focused on expanding its infrastructure to capitalize on increasing domestic energy production.

EPD had $18.38 billion in principal amounts outstanding under consolidated debt agreements as of March 31, 2014. In February 2014, the company issued new senior notes to repay existing debt and for general corporate purposes. EPD maintained compliance with its financial covenants and has access to a $3.5 billion multi-year revolving credit facility, indicating a stable liquidity position.

Net income attributable to limited partners increased to $798.8 million in Q1 2014 from $753.5 million in Q1 2013. This improvement was supported by higher revenues, effective cost management, and contributions from new assets and expansions, such as the ATEX pipeline. Additionally, the company benefited from higher equity income from unconsolidated affiliates, particularly in crude oil pipeline joint ventures.