Enterprise Announces Record Earnings and Cash Flow.Business/Energy Editors HOUSTON--(BUSINESS WIRE)--April 27, 2000 Enterprise Products Partners L.P. (NYSE NYSE See: New York Stock Exchange :EPD EPD expected progeny difference. ) today announced record earnings and cash flow for the first quarter ending on March 31, 2000. Net income for the first quarter was $69.4 million, or $0.85 per unit on a fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis, compared to net income of $10.5 million, or $0.16 per unit, for the first quarter of 1999. The average number of units outstanding for the first quarter of 2000 was 81.2 million, versus 66.8 million for the first quarter of 1999. Enterprise generated $84.6 million of cash flow during the first quarter of 2000. This equates to $1.24 per unit based on common and subordinated Subordinated A claim ranked lower in priority than other claims. Common stock claims are always subordinated to debt. units. Cash flow coverage of the $0.50 per unit quarterly distribution was 248% on common and subordinated units. The 14.5 million Special Units outstanding were not considered as they do not participate in distributions until their conversion into common units, which will occur over the next three years beginning Aug. 1, 2000. "Substantial volume growth and the strong domestic and international demand for natural gas liquids, which benefited both our fee-based businesses and our natural gas processing Natural gas processing plants, or fractionators, are used to purify the raw natural gas extracted from underground gas fields and brought up to the surface by gas wells. The processed natural gas, used as fuel by residential, commercial and industial consumers, is almost pure business, led Enterprise to post record earnings and cash flow in all business segments. Much of our volume and margin growth was derived de·rive v. de·rived, de·riv·ing, de·rives v.tr. 1. To obtain or receive from a source. 2. from accretive acquisitions Accretive Acquisition An acquisition that will increase the acquiring company's EPS. Notes: As they are expected to increase the acquiring company's future earnings, these acquisitions tend to be favorable for the company's market price. and investments in projects which started commercial operations during the last nine months. These investments were more than $600 million," stated O.S. "Dub" Andras Andras demon of discord. [Occultism: Jobes, 93] See : Discord , president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Enterprise. "We anticipate additional volume growth from additional deepwater Deepwater or Deep Water may refer to:
Golfo de Mexico Atlantic, Atlantic Ocean - the 2nd largest ocean; separates North and South America on the west from Europe and Africa on the east during the year." "Our financial position at the end of the quarter, 32.5% total debt to total capitalization Total capitalization The total long-term debt and all types of equity of a company that constitutes its capital structure. total capitalization See capitalization. and $50 million in cash, provides Enterprise with ample financial flexibility to pursue our strategy to grow the partnership through internally generated projects and acquisitions. The construction of our 206-mile Lou-Tex NGL NGL - A dialect of IGL. pipeline has begun with completion expected late in the third quarter of 2000," Andras continued. "Based on the growth and sustainability of our cash flows from fee-based businesses, we are currently evaluating an increase in the quarterly cash distribution rate to our unitholders. We expect to make an announcement on the amount and the timing of such an increase by the end of the second quarter," stated Andras. Revenues for the first quarter of 2000 increased to $753.7 million from $148.9 million for the first quarter of 1999. Gross operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: increased three-fold during the first quarter of 2000 to $91.6 million as compared to $22.4 million during 1999. The increase in gross operating margin for the quarter was due to volume increases in the Fractionation fractionation /frac·tion·a·tion/ (frak?shun-a´shun) 1. in radiology, division of the total dose of radiation into small doses administered at intervals. 2. , Pipeline and Processing segments and strong natural gas liquid ("NGL") prices during the quarter. Gross operating margin represents earnings before depreciation, amortization, lease expense for which Enterprise does not have the payment obligation, general and administrative expenses and interest. Enterprise's equity earnings from unconsolidated affiliates are also included in gross margin. Fractionation -- For the first quarter of 2000, Fractionation gross operating margin increased 110% to $34.3 million from $16.3 million as the result of a 310% increase in NGL fractionation volumes and a 31% increase in propylene propylene /pro·pyl·ene/ (pro´pi-len) a gaseous hydrocarbon, CH3CHdbondCH2. propylene glycol a colorless viscous liquid used as a humectant and solvent in pharmaceutical preparations. fractionation volumes. Net NGL fractionation volumes were 228,000 barrels per day Barrels per day (abbreviated BPD, bbl/d, bpd, bd or b/d) is a measurement used to describe the amount of crude oil (measured in barrels) produced or consumed by an entity in one day. ("BPD Borderline personality disorder (BPD) A pattern of behavior characterized by impulsive acts, intense but chaotic relationships with others, identity problems, and emotional instability. ") versus 56,000 BPD in the first quarter of last year. Propylene fractionation volumes in the first quarter of 2000 were 30,000 BPD compared to 23,000 BPD in the first quarter of 1999. Butane butane (by  `tān), C4H10, gaseous alkane, a hydrocarbon that is obtained from natural gas or by refining petroleum. isomerization isomerization /isom·er·iza·tion/ (i-som?er-i-za´shun) the process whereby any isomer is converted into another isomer, usually requiring special conditions of temperature, pressure, or catalysts. volumes remained firm at
67,000 BPD.Pipelines -- Pipeline's gross margin in the current first quarter was $14.6 million, an increase of 225% from $4.5 million in the first quarter of 1999. The margin improvement was due to a 150% increase in net pipeline throughput The speed with which a computer processes data. It is a combination of internal processing speed, peripheral speeds (I/O) and the efficiency of the operating system and other system software all working together. 1. to 397,000 BPD from 159,000 BPD in the first quarter of 1999. The current quarter includes one month of earnings from the Lou-Tex Propylene Pipeline, which was acquired effective March 1, 2000. Processing -- The Processing segment, which includes Enterprise's natural gas processing and merchant NGL businesses, had a gross operating margin of $39.6 million compared to $1.1 million in 1999. This segment benefited from natural gas processing volumes of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 68,000 BPD and strong processing economics. The Neptune natural gas processing plant began operations in late-February. This plant increased equity NGL production by approximately 6,000 BPD since its start-up Start-up The earliest stage of a new business venture. . Several adjustments to net income are required to calculate available cash flow. These adjustments include the addition of (1) non-cash expenses Noun 1. non-cash expense - an expense (such as depreciation) that is not paid for in cash disbursal, disbursement, expense - amounts paid for goods and services that may be currently tax deductible (as opposed to capital expenditures) such as depreciation and amortization expense; (2) lease expenses for which the partnership does not have the payment obligation; (3) principal payments on notes receivable held by the company; (4) actual cash distributions from unconsolidated affiliates as compared to book earnings, and (5) other miscellaneous adjustments, less maintenance capital expenditures and reserves deemed prudent by the general partner. Enterprise Products Partners L.P. is one of the largest publicly traded master limited partnerships with an enterprise value of approximately $2 billion. Enterprise is a leading integrated provider of processing, fractionation, storage, transportation and terminalling services to producers and consumers of natural gas liquids ("NGLs") and other liquid hydrocarbons hydrocarbons (hīˈ·drō·kärˑ·b  nz),n. . The Company's assets are geographically ge·o·graph·ic also ge·o·graph·i·cal adj. 1. Of or relating to geography. 2. Concerning the topography of a specific region. ge focused on the United States' Gulf Coast, which accounts for approximately 55 percent of domestic NGL production and 75 percent of domestic NGL demand. This press release includes forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of Section 21E of the Securities Exchange Act of 1934 based on the beliefs of the company, as well as assumptions made by, and information currently available to, management. Although Enterprise believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct.
Enterprise Products Partners L.P.
Operating Data -- UNAUDITED
For the three months ended March 31, 2000
For the three months ended
------------------------------------
March 31, March 31, % Increase
2000 1999 (Decrease)
---------- ---------- ----------
Gross Operating Margin
by Segment ($000s):
----------------------
Fractionation $34,331 $16,321 110%
Pipeline 14,635 4,501 225%
Processing 39,554 1,091 3525%
Octane Enhancement 2,505 301 732%
Other 554 205 170%
-------- --------
Total Gross
Operating Margin $91,579 $22,419 308%
-------- --------
Depreciation 8,124 4,688 73%
Retained Lease
Expense, net 2,637 2,666 -1%
(Gain) loss on
sale of assets -- (3) -100%
General and
Administrative Expense 5,384 3,000 79%
-------- --------
Operating Income $75,434 $12,068 525%
======== ========
Operating Data (000s of
barrels/day, Net):
-----------------------
Equity NGL Production 68 -- NM
NGL Fractionation 228 56 310%
Isomerization 67 67 0%
Propylene Fractionation 30 23 31%
Octane Enhancement 4 4 0%
Major Pipelines 397 159 150%
Average Commodity Prices:
-------------------------
Henry Hub Natural
Gas ($/MMBtu) $2.62 $1.80 45%
Gulf Coast Crude
Oil ($/barrel) $28.88 $13.22 119%
Mont Belvieu Natural
Gas Liquids ($/gallon) $0.51 $0.20 155%
Enterprise Products Partners L.P.
Statement of Consolidated Operations -- UNAUDITED
For the three months ended March 31, 2000
($ in 000s, except per unit amounts)
For the three months ended
---------------------------
March 31, March 31,
2000 1999
--------- ----------
Revenue
-------
Revenue from consolidated
operations $746,281 $147,314
Equity income in
unconsolidated affiliates 7,443 1,563
--------- ---------
Total Revenue 753,724 148,877
Costs and Expenses:
-------------------
Operating costs
and expenses 672,906 133,809
Selling, general
and administrative 5,384 3,000
--------- ---------
Total Costs and Expenses 678,290 136,809
--------- ---------
Operating Income 75,434 12,068
Other Income (Expense):
-----------------------
Interest expense (7,774) (2,263)
Interest income from
unconsolidated affiliates 144 397
Dividend income from
unconsolidated affiliates 1,234 --
Interest income -- other 1,481 284
Other, net (363) 75
--------- ---------
Total Other Income
(Expense) (5,278) (1,507)
--------- ---------
Income before minority
interest 70,156 10,561
Minority interest (709) (106)
--------- ---------
Net income $69,447 $10,455
========= =========
Allocation of Net
Income to:
-----------------
Limited partners $68,753 $10,350
General partner $694 $105
Per Unit data (Fully Diluted):
------------------------------
Net income per Common,
Subordinated &
Special Units $0.85 $0.16
Average LP Common,
Subordinated & Special
Units Outstanding (000s) 81,195.6 66,755.6
Other Financial data:
---------------------
Depreciation and Amortization $8,124 $4,905
Leases paid by EPCO $2,637 $2,639
Collection of notes receivable
from unconsolidated affiliates $3,286 $3,684
Distributions from or (cash calls to)
unconsolidated affiliates $7,150 $2,505
Maintenance capital expenditures $268 $258
Total Capital Expenditures $111,449 $1,672
Investments in and advances to
unconsolidated affiliates $5,971 $28,866
Inventory balance at end of period $13,716 $17,773
Total Debt balance at end of period $404,000 $110,000
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