10-QPeriod: Q2 FY2018

Energy Transfer LP Quarterly Report for Q2 Ended Jun 30, 2018

Filed August 9, 2018For Securities:ETET-PI

Summary

Energy Transfer LP (ET) reported its second quarter and first six months of 2018 results. The company demonstrated strong operational performance with significant revenue growth driven by increased activity across its transportation and storage segments. For the three months ended June 30, 2018, total revenues were $14.1 billion, a substantial increase from $9.4 billion in the prior year period, reflecting higher volumes and favorable market conditions in NGL, crude oil, and refined product sales. Net income attributable to partners rose to $355 million, up from $212 million in the same quarter last year. The company also made significant progress on strategic initiatives, including the acquisition of USAC and the announcement of a definitive agreement to merge ETP with a subsidiary of ETE, aimed at simplifying its corporate structure. This period highlights robust financial performance and strategic advancements for Energy Transfer LP. Looking at the six-month period, ET's total revenues reached $26.0 billion, a significant jump from $19.1 billion in the first half of 2017. Net income attributable to partners for the six months was $718 million, compared to $451 million in the prior year. The company's Segment Adjusted EBITDA also showed a substantial increase, reaching $4.26 billion for the six months ended June 30, 2018, up from $3.29 billion in the comparable period of 2017, indicating strong underlying operational cash flow generation. These results underscore the company's ability to capitalize on market opportunities and execute its strategic growth plans.

Financial Highlights

42 data points
Beta

Revenue

$14.12B

19.7% Gross Margin

Net Income

$355.00M

2.5% Net Margin

Total Assets

$87.42B

Cash & Equivalents

$519.00M

Free Cash Flow

$1.02B

Financial Statements
Beta
Revenue$14.12B
Cost of Revenue$11.34B
Gross Profit$2.77B
SG&A Expenses$183.00M
Operating Expenses$12.99B
Operating Income$1.13B
Interest Expense$510.00M
Net Income$355.00M

Key Highlights

  • 1Total revenues for the three months ended June 30, 2018, increased to $14.1 billion from $9.4 billion in the prior year period.
  • 2Net income attributable to partners for the three months ended June 30, 2018, was $355 million, up from $212 million in the prior year period.
  • 3Segment Adjusted EBITDA for the six months ended June 30, 2018, was $4.26 billion, an increase from $3.29 billion in the prior year period.
  • 4The company acquired a controlling interest in USAC (USA Compression Partners, LP) in April 2018, consolidating its operations.
  • 5A definitive agreement was announced in August 2018 for the merger of ETP with a wholly-owned subsidiary of ETE, aiming to simplify the corporate structure.
  • 6ETP issued significant amounts of senior notes in June 2018, raising proceeds to repay outstanding borrowings and redeem other senior notes.
  • 7Sunoco LP completed a large asset sale to 7-Eleven in January 2018 and issued new senior notes to redeem existing debt and other obligations.

Frequently Asked Questions

In the second quarter of 2018, Energy Transfer LP reported total revenues of $14.1 billion, a significant increase from $9.4 billion in the same period of 2017. Net income attributable to partners was $355 million, compared to $212 million in the prior year's second quarter. Segment Adjusted EBITDA also showed robust growth, reaching $2.26 billion for the quarter.

Key strategic developments included the acquisition of a controlling interest in USAC (USA Compression Partners, LP) in April 2018. Additionally, in August 2018, the company announced a definitive agreement to merge ETP with a subsidiary of ETE, a move intended to simplify its corporate structure. ETP also completed significant debt offerings and redemptions during the quarter.

As of June 30, 2018, total consolidated debt was approximately $44.6 billion, an increase from $44.1 billion at December 31, 2017. This increase was influenced by various debt issuances and repayments across the company's subsidiaries, including significant senior note offerings by ETP.

The acquisition of USAC, effective April 2, 2018, resulted in its consolidation into Energy Transfer's financial statements. USAC contributed approximately $167 million in revenues and $95 million in Segment Adjusted EBITDA for the period from April 2, 2018, to June 30, 2018, impacting the overall financial results.