Energy Transfer LP (NYSE:ET, Financial) (“Energy Transfer” or the “Partnership”) today reported financial results for the quarter ended June 30, 2023.
Energy Transfer reported net income attributable to partners for the three months ended June 30, 2023 of $911 million. For the three months ended June 30, 2023, net income per common unit (basic) was $0.25 per unit.
Adjusted EBITDA for the three months ended June 30, 2023 was $3.12 billion compared to $3.23 billion for the three months ended June 30, 2022.
Distributable Cash Flow attributable to partners, as adjusted, for the three months ended June 30, 2023 was $1.55 billion compared to $1.88 billion for the three months ended June 30, 2022.
Growth capital expenditures in the second quarter of 2023 were $387 million while maintenance capital expenditures were $216 million.
Operational Highlights
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During the second quarter of 2023, Energy Transfer’s assets continued to reach new milestones, with volumes increasing across most segments compared to the same period last year.
- NGL fractionation volumes were up 5%, setting a new Partnership record.
- NGL transportation volumes were up 13%, setting a new Partnership record.
- Midstream gathered volumes increased 8%, setting a new Partnership record.
- Intrastate natural gas transportation volumes were up 3%, setting a new Partnership record.
- Interstate natural gas transportation volumes were up 17%.
- Crude transportation and terminal volumes were up 23% and 15%, respectively.
- Total NGL exports out of both the Nederland and Marcus Hook Terminals reached another record in the second quarter.
- In June 2023, the 200 MMcf/d Bear cryogenic processing plant, which is located in the Delaware Basin, was placed into service.
Strategic Highlights
- In May 2023, the Partnership completed the acquisition of Lotus Midstream Operations, LLC, and integration of operations is ongoing.
- In July 2023, Lake Charles LNG entered into three non-binding Heads of Agreements (“HOAs”) related to long-term LNG offtake for an aggregate of 3.6 million tonnes per annum.
Financial Highlights
- Energy Transfer expects its full-year 2023 Adjusted EBITDA to range between $13.1 billion and $13.4 billion, which is slightly tighter than the previous range ($13.05 billion to $13.45 billion) while keeping the midpoint the same.
- In July 2023, Energy Transfer announced a quarterly cash distribution of $0.31 per common unit ($1.24 annualized) for the quarter ended June 30, 2023.
- As of June 30, 2023, the Partnership’s revolving credit facility had an aggregate $2.36 billion of available borrowing capacity.
- For the three months ended June 30, 2023, the Partnership invested approximately $387 million on growth capital expenditures.
Energy Transfer benefits from a portfolio of assets with exceptional product and geographic diversity. The Partnership’s multiple segments generate high-quality, balanced earnings with no single segment contributing more than 30% of the Partnership’s consolidated Adjusted EBITDA for the three months ended June 30, 2023. The vast majority of the Partnership’s segment margins are fee-based and therefore have limited commodity price sensitivity.
Conference Call information:
The Partnership has scheduled a conference call for 3:30 p.m. Central Time/4:30 p.m. Eastern Time on Wednesday, August 2, 2023 to discuss its second quarter 2023 results and provide an update on the Partnership. The conference call will be broadcast live via an internet webcast, which can be accessed through www.energytransfer.com and will also be available for replay on the Partnership’s website for a limited time.
Energy Transfer LP (NYSE: ET) owns and operates one of the largest and most diversified portfolios of energy assets in the United States, with nearly 125,000 miles of pipeline and associated energy infrastructure. Energy Transfer’s strategic network spans 41 states with assets in all of the major U.S. production basins. Energy Transfer is a publicly traded limited partnership with core operations that include complementary natural gas midstream, intrastate and interstate transportation and storage assets; crude oil, natural gas liquids (“NGL”) and refined product transportation and terminalling assets; and NGL fractionation. Energy Transfer also owns Lake Charles LNG Company, as well as the general partner interests, the incentive distribution rights and approximately 34% of the outstanding common units of Sunoco LP (NYSE: SUN), and the general partner interests and approximately 47% of the outstanding common units of USA Compression Partners, LP (NYSE: USAC). For more information, visit the Energy Transfer LP website at www.energytransfer.com.
Sunoco LP (NYSE: SUN) is a master limited partnership with core operations that include the distribution of motor fuel to approximately 10,000 convenience stores, independent dealers, commercial customers, and distributors located in more than 40 U.S. states and territories, as well as refined product transportation and terminalling assets. For more information, visit the Sunoco LP website at www.sunocolp.com.
USA Compression Partners, LP (NYSE: USAC) is one of the nation’s largest independent providers of natural gas compression services in terms of total compression fleet horsepower. USAC partners with a broad customer base composed of producers, processors, gatherers and transporters of natural gas and crude oil. USAC focuses on providing midstream natural gas compression services to infrastructure applications primarily in high-volume gathering systems, processing facilities, and transportation applications. For more information, visit the USAC website at www.usacompression.com.
Forward-Looking Statements
This news release may include certain statements concerning expectations for the future that are forward-looking statements as defined by federal law. Such forward-looking statements are subject to a variety of known and unknown risks, uncertainties, and other factors that are difficult to predict and many of which are beyond management’s control. An extensive list of factors that can affect future results are discussed in the Partnership’s Annual Report on Form 10-K and other documents filed from time to time with the Securities and Exchange Commission. The Partnership undertakes no obligation to update or revise any forward-looking statement to reflect new information or events.
The information contained in this press release is available on our website at www.energytransfer.com.
ENERGY TRANSFER LP AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in millions) (unaudited) | |||||||
June 30, 2023 | December 31, 2022 | ||||||
ASSETS | |||||||
Current assets | $ | 10,598 | $ | 12,081 | |||
Property, plant and equipment, net | 81,149 | 80,311 | |||||
Investments in unconsolidated affiliates | 3,007 | 2,893 | |||||
Lease right-of-use assets, net | 826 | 819 | |||||
Non-current derivative assets | 3 | — | |||||
Other non-current assets, net | 1,684 | 1,558 | |||||
Intangible assets, net | 5,301 | 5,415 | |||||
Goodwill | 2,564 | 2,566 | |||||
Total assets | $ | 105,132 | $ | 105,643 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities (1) | $ | 13,013 | $ | 10,368 | |||
Long-term debt, less current maturities | 44,672 | 48,260 | |||||
Non-current derivative liabilities | 23 | 23 | |||||
Non-current operating lease liabilities | 786 | 798 | |||||
Deferred income taxes | 3,839 | 3,701 | |||||
Other non-current liabilities | 1,342 | 1,341 | |||||
Commitments and contingencies | |||||||
Redeemable noncontrolling interests | 495 | 493 | |||||
Equity: | |||||||
Limited Partners: | |||||||
Preferred Unitholders | 6,042 | 6,051 | |||||
Common Unitholders | 27,487 | 26,960 | |||||
General Partner | (2 | ) | (2 | ) | |||
Accumulated other comprehensive income | 24 | 16 | |||||
Total partners’ capital | 33,551 | 33,025 | |||||
Noncontrolling interests | 7,411 | 7,634 | |||||
Total equity | 40,962 | 40,659 | |||||
Total liabilities and equity | $ | 105,132 | $ | 105,643 | |||
(1) | As of June 30, 2023, current liabilities include a total of $3.45 billion of current maturities of long-term debt; this total comprises (i) $2.45 billion, representing the amount of Energy Transfer senior notes maturing on or before June 30, 2024, less the current available capacity on the Partnership’s Five-Year Credit Facility and (ii) $1.00 billion of senior notes issued by the Bakken Pipeline entities, which mature in April 2024. The Partnership’s proportional ownership in the Bakken Pipeline entities is 36.4%. | |
ENERGY TRANSFER LP AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars and units in millions, except per unit data) (unaudited) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
REVENUES | $ | 18,320 | $ | 25,945 | $ | 37,315 | $ | 46,436 | |||||||
COSTS AND EXPENSES: | |||||||||||||||
Cost of products sold | 14,092 | 21,515 | 28,702 | 37,653 | |||||||||||
Operating expenses | 1,094 | 1,060 | 2,119 | 2,009 | |||||||||||
Depreciation, depletion and amortization | 1,061 | 1,046 | 2,120 | 2,074 | |||||||||||
Selling, general and administrative | 228 | 211 | 466 | 441 | |||||||||||
Impairment losses | 10 | — | 11 | 300 | |||||||||||
Total costs and expenses | 16,485 | 23,832 | 33,418 | 42,477 | |||||||||||
OPERATING INCOME | 1,835 | 2,113 | 3,897 | 3,959 | |||||||||||
OTHER INCOME (EXPENSE): | |||||||||||||||
Interest expense, net of interest capitalized | (641 | ) | (578 | ) | (1,260 | ) | (1,137 | ) | |||||||
Equity in earnings of unconsolidated affiliates | 95 | 62 | 183 | 118 | |||||||||||
Gains on interest rate derivatives | 35 | 129 | 15 | 243 | |||||||||||
Other, net | 17 | (18 | ) | 24 | 3 | ||||||||||
INCOME BEFORE INCOME TAX EXPENSE | 1,341 | 1,708 | 2,859 | 3,186 | |||||||||||
Income tax expense | 108 | 86 | 179 | 77 | |||||||||||
NET INCOME | 1,233 | 1,622 | 2,680 | 3,109 | |||||||||||
Less: Net income attributable to noncontrolling interests | 308 | 284 | 629 | 489 | |||||||||||
Less: Net income attributable to redeemable noncontrolling interests | 14 | 12 | 27 | 25 | |||||||||||
NET INCOME ATTRIBUTABLE TO PARTNERS | 911 | 1,326 | 2,024 | 2,595 | |||||||||||
General Partner’s interest in net income | 1 | 1 | 2 | 2 | |||||||||||
Preferred Unitholders’ interest in net income | 113 | 105 | 222 | 211 | |||||||||||
Common Unitholders’ interest in net income | $ | 797 | |||||||||||||
