10-KPeriod: FY2019

Energy Transfer LP Annual Report, Year Ended Dec 31, 2019

Filed February 21, 2020For Securities:ETET-PI

Summary

Energy Transfer LP (ET) filed its 2019 Form 10-K on February 20, 2020, detailing a year of significant strategic moves and operational growth. The company successfully integrated the acquisition of SemGroup Corporation, expanding its crude oil and refined products infrastructure, including the planned Ted Collins pipeline. ET also made progress on its Lake Charles LNG liquefaction project by issuing commercial tender packages for construction bids. The company's diversified business segments, including intrastate and interstate natural gas transportation and storage, midstream, and NGL/refined products and crude oil transportation, all demonstrated growth in key performance metrics and EBITDA. ET's investments in Sunoco LP and USA Compression Partners (USAC) also contributed positively to the overall results. The company highlighted its commitment to growth through acquisitions and organic projects while maintaining a strong balance sheet and investment-grade credit metrics. Despite facing a competitive and evolving energy landscape, ET remains focused on enhancing unitholder value through stable cash flows and strategic expansion.

Financial Highlights

44 data points
Beta

Revenue

$54.21B

26.6% Gross Margin

Net Income

$3.52B

6.5% Net Margin

Total Assets

$98.97B

Cash & Equivalents

$291.00M

Free Cash Flow

$8.06B

Financial Statements
Beta
Revenue$54.21B
Cost of Revenue$39.80B
Gross Profit$14.41B
SG&A Expenses$694.00M
Operating Expenses$47.01B
Operating Income$7.20B
Interest Expense$2.33B
Net Income$3.52B

Key Highlights

  • 1Completed the acquisition of SemGroup Corporation in December 2019, adding crude oil and refined products infrastructure and expanding market access along the Gulf Coast.
  • 2Announced significant progress on the Lake Charles LNG liquefaction project, issuing commercial tender packages for construction bids.
  • 3Experienced growth across its diverse operating segments, with NGL and Refined Products Transportation and Services, and Crude Oil Transportation and Services showing particularly strong increases in Segment Adjusted EBITDA.
  • 4Investments in Sunoco LP and USA Compression Partners (USAC) performed well, contributing positively to the company's overall financial results.
  • 5ET reported an increase in consolidated Adjusted EBITDA by 18% to $9.51 billion for 2019 compared to 2018, driven by new assets, acquisitions, and increased demand.
  • 6The company reiterated its commitment to a growth-oriented strategy, balancing expansion with a focus on maintaining a strong balance sheet and investment-grade credit metrics.
  • 7Capital expenditures for growth projects were robust, with ETO expecting between $3.92 billion and $4.13 billion in growth capital expenditures for 2020.

Frequently Asked Questions

In 2019, Energy Transfer LP's key strategic achievements included the completion of the SemGroup Corporation acquisition in December, which significantly expanded its crude oil and refined products infrastructure. Additionally, the company advanced its Lake Charles LNG liquefaction project by issuing commercial tender packages for EPC contractors, signaling progress towards potential development.

Energy Transfer LP's diverse segments generally performed well. The NGL and Refined Products Transportation and Services segment and the Crude Oil Transportation and Services segment showed substantial increases in Segment Adjusted EBITDA, driven by new asset additions, acquisitions, and increased demand. The company also saw positive contributions from its intrastate and interstate natural gas transportation and storage segments, as well as its investments in Sunoco LP and USAC.

For 2020, Energy Transfer LP's ETO segment anticipates capital expenditures for growth projects to be in the range of $3.92 billion to $4.13 billion. The company remains focused on pursuing growth through strategic acquisitions and organic expansion opportunities, aiming to enhance unitholder value while maintaining financial strength and investment-grade credit ratings.

In 2019, Energy Transfer LP's subsidiaries engaged in several financing activities, including preferred unit issuances and senior notes offerings, to manage their capital structures. The company's consolidated debt increased, but its leverage ratios generally remained within covenants, reflecting ongoing efforts to fund growth and operations. For example, ETO entered into a $2.00 billion term loan facility and issued billions in senior notes in January 2020 to refinance existing debt.