What is the primary driver of the decrease in total revenues?

The primary driver of the decrease in total revenues to $1.63 billion from $2.64 billion year-over-year is the decline in natural gas operations and retail propane sales, largely influenced by lower commodity prices and economic conditions impacting customer demand.

How is the company managing its liquidity given the current economic climate?

Energy Transfer Equity, L.P. is maintaining a strong liquidity position by preserving available capacity under its Parent Company and ETP credit facilities, which totaled approximately $1.44 billion as of March 31, 2009. The company also successfully raised significant capital through debt and equity offerings in early 2009 and expects to fund its capital expenditures and working capital needs through these resources and operating cash flow until the latter half of 2010.

What is the outlook for the company's major pipeline projects, MEP and FEP?

Construction and development for the Midcontinent Express Pipeline (MEP) and Fayetteville Express Pipeline (FEP) projects are progressing. The company expects to make substantial capital contributions to these joint ventures throughout 2009 to fund their ongoing construction. The first phase of MEP was placed in interim service in April 2009, with the second phase expected by Q3 2009. FEP is expected to be in service by early 2011.

How are lower natural gas prices affecting the company's business segments?

Lower natural gas prices are directly impacting revenues from natural gas transportation and midstream operations, particularly for volume-based revenue components. However, the company's significant reliance on long-term fee-based contracts in its intrastate and interstate natural gas operations provides some revenue stability. The retail propane segment's margins are expected to remain relatively stable due to pricing strategies and hedging, despite lower wholesale propane costs.

ET/ET-PI 10-Q Quarterly Report Q1 FY2009 — Revenue, Net Income, EPS

Summary

Energy Transfer Equity, L.P. (ETE) reported its first quarter 2009 results, showing a net income of $279.8 million, a slight increase from $267.2 million in the prior year's comparable period. Revenues, however, saw a significant decline, falling to $1.63 billion from $2.64 billion year-over-year, primarily driven by lower natural gas and retail propane sales. Despite revenue contraction, operating income remained relatively stable at $356.1 million, supported by improved performance in the retail propane segment, which offset declines in natural gas operations. The company's balance sheet showed total assets of $11.04 billion and total liabilities of $8.40 billion, with total equity increasing to $2.64 billion. ETE maintained a strong liquidity position with substantial credit facility availability. The company also highlighted progress on major pipeline projects like Midcontinent Express Pipeline (MEP) and Fayetteville Express Pipeline (FEP), with significant capital contributions planned for these ventures throughout 2009. Investors should note the impact of lower commodity prices on natural gas revenues, although fee-based contracts provide some stability. The company's strategic focus remains on growing its natural gas midstream and propane businesses through internal projects and acquisitions. ETE also declared an increased quarterly distribution, signaling confidence in its financial performance and ability to generate distributable cash flow.

Key Highlights

1Net income increased to $279.8 million for the three months ended March 31, 2009, up from $267.2 million in the same period of 2008.
2Total revenues decreased significantly to $1.63 billion from $2.64 billion year-over-year, primarily due to lower natural gas and retail propane sales.
3Operating income remained strong at $356.1 million, a slight decrease from $367.9 million in Q1 2008, demonstrating operational resilience.
4The retail propane segment showed strong performance, with operating income increasing to $164.1 million from $107.0 million, driven by favorable gross margin management.
5The company has substantial liquidity, with approximately $1.44 billion in available capacity under its Parent Company and ETP credit facilities as of March 31, 2009.
6Progress continues on major pipeline projects, MEP and FEP, with significant capital contributions planned for 2009.
7The company declared an increased quarterly distribution of $0.525 per Common Unit for Q1 2009, up from $0.51 per Common Unit in the prior quarter.

Energy Transfer LP Quarterly Report for Q1 Ended Mar 31, 2009

Summary

Key Highlights

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