What was the primary driver of the revenue increase in the nine months ended May 31, 2006?

The significant increase in revenue was primarily driven by the completion of several strategic acquisitions, including the HPL System, and by increased volumes and prices in the midstream and transportation and storage segments.

How did the IPO impact the company's financial position?

The IPO in February 2006 provided approximately $474 million in net proceeds. This capital was used to repay a portion of existing debt ($175.5 million) and for general partnership purposes, strengthening the company's balance sheet and providing financial flexibility.

What is the outlook for the company's infrastructure expansion projects?

Energy Transfer Equity is investing in significant expansion projects, notably a $360 million project to expand its 42-inch pipeline system, increasing throughput capabilities. This project is expected to be completed by August 2007, indicating a strategic focus on growth and increased capacity.

How has the propane segment performed, and what are the key factors affecting it?

The propane segment saw revenue growth, driven by acquisitions and higher selling prices. However, performance is also significantly influenced by weather patterns, particularly during the peak heating season. Warmer-than-normal weather in the reported periods had an adverse impact on retail propane volumes.

ET/ET-PI 10-Q Quarterly Report Q2 FY2006 — Revenue, Net Income, EPS

Summary

Energy Transfer Equity, L.P. (ET) reported its results for the quarter and nine months ended May 31, 2006. The company saw a significant increase in revenues for the nine-month period compared to the prior year, driven by strategic acquisitions and increased volumes and prices in its midstream and transportation segments. The IPO in February 2006 provided a substantial capital infusion, which was used partly to repay debt and for general partnership purposes. While the company experienced a decrease in net income for the quarter due to a one-time gain from discontinued operations in the prior year, the underlying operational performance showed improvements. The company's propane segment saw revenue growth, though impacted by warmer weather. Significant investments in infrastructure expansion for the midstream segment are underway, indicating a focus on future growth. The company's liquidity remains solid, supported by its revolving credit facilities and cash generated from operations.

Key Highlights

1Total revenues for the nine months ended May 31, 2006 increased by $1.95 billion to $6.29 billion compared to $4.34 billion in the prior year period.
2Operating income for the nine months ended May 31, 2006 increased by $272 million to $507 million, primarily due to contributions from recent acquisitions and improved performance in the midstream and transportation segments.
3Net income for the quarter ended May 31, 2006 decreased to $43.3 million from $79.8 million in the prior year, largely due to a significant gain on the sale of discontinued operations in the comparable prior year period.
4The company completed its Initial Public Offering (IPO) in February 2006, raising net proceeds of approximately $474 million.
5The company's midstream and transportation segments continue to show strong volume growth, with natural gas transportation volumes increasing by approximately 1.3 billion MMBtu/d year-over-year for the quarter.
6The company is undertaking significant expansion projects in its midstream segment, including a $360 million pipeline construction project to increase throughput capabilities.
7Liquidity remains adequate, with a $500 million revolving credit facility and a $900 million (recently increased to $1.3 billion) ETP revolving credit facility providing financial flexibility.

Energy Transfer LP Quarterly Report for Q2 Ended May 31, 2006

Summary

Key Highlights

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