Energy Transfer Equity LP (NYSE:ETE) reported financial results for the quarter ended September 30, 2015.
Distributable Cash Flow, as adjusted, for the three months ended September 30, 2015 was $325 millioncompared to $234 million for the three months ended September 30, 2014, an increase of $91 million. Distributable Cash Flow, as adjusted, per unit was $0.31 for the three months ended September 30, 2015, an increase of 41% compared to the three months ended September 30, 2014. Distributable Cash Flow, as adjusted, for the three months ended September 30, 2015 would have been $352 million, or $0.33 per unit, if the SUN GP/IDR Exchange (as defined below) had not taken place. ETE’s net income attributable to partners was $293 million for the three months ended September 30, 2015 compared to $188 million for the three months ended September 30, 2014, an increase of $105 million.
Distributable Cash Flow, as adjusted, for the nine months ended September 30, 2015 was $981 millioncompared to $652 million for the nine months ended September 30, 2014, an increase of $329 million. Distributable Cash Flow, as adjusted, per unit was $0.91 for the nine months ended September 30, 2015, an increase of 54% compared to the nine months ended September 30, 2014. ETE’s net income attributable to partners was $875 million for the nine months ended September 30, 2015 compared to $520 million for the nine months ended September 30, 2014, an increase of $355 million.
The Partnership’s recent key accomplishments and other developments include the following:
- In September 2015, ETE and the Williams Companies, Inc. (“WMB”) announced a business combination transaction valued at $37.7 billion, including the assumption of debt and other liabilities. The combination will create the third largest energy franchise in North America and one of the five largest global energy companies. The transaction is expected to close in the first half of 2016.
- In October 2015, ETE entered into an Amended and Restated Commitment Letter with a syndicate of 20 banks for a senior secured credit facility in an aggregate principal amount of $6.05 billion in order to fund the cash portion of the WMB Merger. Under the terms of the facility, the banks have committed to provide a 364-day secured loan that can be extended at ETE’s option for an additional year. The interest rate on the facility is capped at 5.5%.
- During the third quarter 2015, Lake Charles LNG Export Company, LLC (“Lake Charles LNG”), an entity owned 60% by ETE and 40% by Energy Transfer Partners, L.P. (“ETP”), received the Federal Energy Regulatory Commission (“FERC”) Final Environmental Impact Study for the liquefaction project. This issuance starts the 90-day period in which other federal agencies are required to complete their review of the liquefaction project and issue any agency authorizations. That decision deadline is November 12, 2015. The FERC authorization for the liquefaction project is expected to be issued during this 90-day period. With the expected emphasis on capital discipline and overall cost, ETE continues to believe that Lake Charles LNG is one of the most attractive pre-final investment decision (“FID”) projects for bothRoyal Dutch Shell plc and BG Group plc and that as a result, the project remains on track to receive FID in 2016, with construction to start immediately thereafter and first LNG exports anticipated in late-2020.
- Effective July 1, 2015, ETE exchanged 21.0 million of the ETP common units that it held at that time for 100% of the general partner interest and incentive distribution rights of Sunoco LP (the “SUN GP/IDR Exchange”).
- In October 2015, ETE’s Board of Directors approved a $0.02 increase in its quarterly distribution to$0.285 per ETE common unit for the third quarter ended September 30, 2015, an increase of 37% compared to the third quarter of 2014 and an increase of 8% compared to the second quarter of 2015. For the quarter ended September 30, 2015, ETE’s distribution coverage ratio is 1.09x, which was lower than the second quarter due to the cash flow impact from the SUN GP/IDR Exchange.
- During 2015, ETE has repurchased approximately $1.06 billion of ETE common units under its current$2.00 billion buyback program.
- As of September 30, 2015, ETE’s $1.5 billion revolving credit facility had $930 million of outstanding borrowings and its leverage ratio, as defined by the credit agreement, was 3.27x.
The Partnership has scheduled a conference call for 8:00 a.m. Central Time, Thursday, November 5, 2015 to discuss its third quarter 2015 results. The conference call will be broadcast live via an internet web cast, which can be accessed through www.energytransfer.com and will also be available for replay on the Partnership’s web site for a limited time.
The Partnership’s principal sources of cash flow are derived from distributions related to its direct and indirect investments in the limited and general partner interests in ETP, including 100% of ETP’s incentive distribution rights, ETP Common Units, ETP Class I Units, and, through ETP Class H Units, which track 90% of the underlying economics of the general partner interest and IDRs of Sunoco Logistics Partners L.P. (“Sunoco Logistics”), distributions related to its investments in the general partner interests in Sunoco Logistics, limited and general partner interest in Sunoco LP, as well as the Partnership’s ownership of Lake Charles LNG. Prior to ETP’s acquisition of Regency Energy Partners LP (“Regency”), the Partnership’s sources of cash flow were also derived from its direct and indirect investments in the limited and general partner of Regency. The Partnership’s primary cash requirements are for general and administrative expenses, debt service requirements and distributions to its partners. (Original Source)
Shares of Energy Transfer Equity closed today at $20.94, down $0.88 or 4.03%. ETE has a 1-year high of $35.44 and a 1-year low of $18.62. The stock’s 50-day moving average is $22.61 and its 200-day moving average is $28.71.
Energy Transfer Equity LP is a limited partnership company. The Company through its subsidiaries, owns and operates, natural gas gathering systems, natural gas intrastate pipeline systems and gas processing plants.