Group 1 - Energy Transfer (NYSE: ET) reported strong Q3 earnings with growth across all categories [1] - The most notable performance was in the oil segment, while NGL and natural gas volumes showed more muted growth [1]

Group 1 - The article highlights Energy Transfer (NYSE: ET) as a top pick in the US midstream sector due to its solid business fundamentals and sector-leading dividend yield [1]

Core Insights - Energy Transfer LP (NYSE: ET) has shown a stock growth of approximately 7%, closely aligning with the performance of the S&P 500 [1] Company Performance - The company released its Q3 report, indicating positive financial performance [1] Investment Strategy - The analysis emphasizes a focus on high-quality companies with reasonable valuations rather than seeking deep discounts, which may indicate underlying issues [1] - The investor's approach combines a growth mindset with a balanced portfolio that includes low-volatility dividend-paying stocks [1]

Core Viewpoint - Energy Transfer is experiencing significant growth through acquisitions and expansion initiatives, leading to record volumes and earnings growth. Group 1: Acquisitions and Expansion - Energy Transfer has completed a $3.1 billion acquisition of WTG Midstream and a $7.1 billion merger with Crestwood Equity Partners, contributing to its growth strategy [1][4] - The company is actively investing in organic expansion, with a pipeline of projects expected to enhance its operations [2][9] Group 2: Volume and Earnings Growth - The third quarter saw record-setting volume growth across various segments, including a 25% increase in crude oil transportation and a 49% rise in crude oil export volume [3][5] - Energy Transfer generated nearly $4 billion in EBITDA, marking a nearly 12% increase year-over-year, while distributable cash flow remained stable at about $2 billion [5][6] Group 3: Financial Flexibility and Future Growth - The company maintains a high-yielding distribution of nearly 7.5%, with $1.1 billion paid in distributions and approximately $900 million in excess free cash flow [6][11] - Energy Transfer plans to invest between $2.8 billion and $3 billion in growth capital projects this year, with ongoing projects expected to come online through 2026 [9][10] Group 4: Strategic Projects - Recent expansions include the Orla East processing plant and a new crude oil pipeline, which are anticipated to boost volume and cash flow [8][9] - Proposed projects such as the Lake Charles LNG terminal and carbon capture initiatives are in development, further enhancing the company's growth outlook [10]

[PART I — FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) [ITEM 1. FINANCIAL STATEMENTS (Unaudited)](index=4&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS%20(Unaudited)) This section presents the unaudited consolidated financial statements for Energy Transfer LP, detailing financial position, operational results, and cash flows for the period ended September 30, 2024 [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Total assets grew to $124.4 billion, driven by increased Property, Plant, and Equipment, while liabilities rose due to higher long-term debt Consolidated Balance Sheet Highlights (in millions) | Account | September 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Total Assets** | **$124,429** | **$113,698** | | Total Current Assets | $13,336 | $12,433 | | Property, Plant, and Equipment, net | $95,012 | $85,351 | | **Total Liabilities** | **$77,811** | **$64,981** | | Total Current Liabilities | $12,371 | $11,277 | | Long-term Debt, less current maturities | $58,995 | $51,380 | | **Total Equity** | **$46,180** | **$43,939** | [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) Revenues and net income attributable to partners increased significantly for the nine months ended September 30, 2024, compared to the prior year Statement of Operations Summary (in millions, except per unit data) | Metric | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :--- | :--- | :--- | | Total Revenues | $63,130 | $58,054 | | Operating Income | $6,859 | $6,130 | | Net Income | $5,118 | $3,727 | | Net Income Attributable to Partners | $3,737 | $2,608 | | Diluted Net Income per Common Unit | $0.99 | $0.72 | [Consolidated Statements of Cash Flows](index=10&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities increased, while investing activities cash use grew due to acquisitions, and financing activities reflected debt and equity transactions Cash Flow Summary (in millions) | Activity | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $8,916 | $8,259 | | Net Cash Used in Investing Activities | ($4,435) | ($3,361) | | Net Cash Used in Financing Activities | ($4,343) | ($4,641) | | **Increase in Cash and Cash Equivalents** | **$138** | **$257** | [Notes to Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail significant accounting policies, major acquisitions like WTG Midstream, debt refinancing, and segment performance [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=46&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses strategic acquisitions, operational results showing significant Adjusted EBITDA growth, liquidity, and capital expenditure plans for 2024 [Recent Developments](index=46&type=section&id=Recent%20Developments) The company completed major acquisitions of WTG Midstream and NuStar, formed a Permian joint venture, and increased its quarterly distribution - Completed the acquisition of **WTG Midstream** for **$2.28 billion in cash** and approximately **50.8 million ET common units**, adding 6,000 miles of gas gathering pipelines and 1.3 Bcf/d of processing capacity in the Midland Basin[205](index=205&type=chunk)[206](index=206&type=chunk) - Subsidiary Sunoco LP completed its acquisition of **NuStar Energy L.P.**, adding approximately **9,500 miles of pipeline** and 63 terminal and storage facilities[207](index=207&type=chunk) - Formed a joint venture with Sunoco LP, combining their respective crude oil and produced water gathering assets in the Permian Basin, with Energy Transfer holding a **67.5% interest**[212](index=212&type=chunk)[213](index=213&type=chunk) - Announced a quarterly cash distribution of **$0.3225 per common unit** for the quarter ended September 30, 2024, an annualized rate of $1.29[214](index=214&type=chunk) [Results of Operations](index=49&type=section&id=Results%20of%20Operations) Consolidated Adjusted EBITDA grew by $1.5 billion to $11.6 billion, propelled by acquisitions and volume growth across key segments Consolidated Adjusted EBITDA by Segment (in millions) | Segment | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | Change | | :--- | :--- | :--- | :--- | | Intrastate transportation and storage | $1,095 | $869 | $226 | | Interstate transportation and storage | $1,335 | $1,468 | ($133) | | Midstream | $2,205 | $1,851 | $354 | | NGL and refined products | $3,071 | $2,852 | $219 | | Crude oil transportation and services | $2,417 | $1,906 | $511 | | Investment in Sunoco LP | $1,018 | $728 | $290 | | Investment in USAC | $429 | $373 | $56 | | **Total Adjusted EBITDA** | **$11,599** | **$10,096** | **$1,503** | - Net income for the nine months ended Sep 30, 2024, **increased by $1.39 billion** year-over-year, primarily due to a **$598 million gain** on Sunoco LP's sale of West Texas assets and the absence of a $625 million litigation loss recorded in the prior year[235](index=235&type=chunk) [Liquidity and Capital Resources](index=65&type=section&id=Liquidity%20and%20Capital%20Resources) The company projects up to $4.0 billion in 2024 capital expenditures and maintains significant borrowing capacity under its credit facility 2024 Expected Capital Expenditures (in millions) | Category | Low Estimate | High Estimate | | :--- | :--- | :--- | | Growth Capital | $2,800 | $3,000 | | Maintenance Capital | $970 | $1,000 | | **Total** | **$3,770** | **$4,000** | - As of September 30, 2024, the Partnership had **$1.63 billion of borrowings outstanding** under its $5.0 billion Five-Year Credit Facility, with **$3.34 billion available** for future borrowings[317](index=317&type=chunk) - Total consolidated debt **increased to $59.3 billion** as of September 30, 2024, from $52.4 billion at December 31, 2023, primarily to fund acquisitions and capital projects[305](index=305&type=chunk) [Cash Distributions](index=71&type=section&id=Cash%20Distributions) Energy Transfer announced a continued sequential increase in its quarterly common unit distribution for Q3 2024, alongside distributions for preferred units Energy Transfer Common Unit Distributions per Unit | Quarter Ended | Payment Date | Rate | | :--- | :--- | :--- | | Dec 31, 2023 | Feb 20, 2024 | $0.3150 | | Mar 31, 2024 | May 20, 2024 | $0.3175 | | Jun 30, 2024 | Aug 19, 2024 | $0.3200 | | Sep 30, 2024 | Nov 19, 2024 | $0.3225 | [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=76&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company manages commodity price risk through derivatives and is exposed to interest rate risk on its $3.09 billion of floating rate debt - The company utilizes exchange-traded and OTC commodity financial instruments (futures, swaps, options) to manage volatility in commodity prices[174](index=174&type=chunk) - As of September 30, 2024, the company had **$3.09 billion of floating rate debt**, where a hypothetical 100 basis point change in interest rates would change annual interest expense by approximately **$31 million**[340](index=340&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=77&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls during the third quarter of 2024 - Based on an evaluation, the Co-Principal Executive Officers and Principal Financial Officer concluded that **disclosure controls and procedures were effective** as of September 30, 2024[343](index=343&type=chunk) - **No material changes** were made to the company's internal control over financial reporting during the three months ended September 30, 2024[344](index=344&type=chunk) [PART II — OTHER INFORMATION](index=78&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) [ITEM 1. LEGAL PROCEEDINGS](index=78&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) This section details updates on legal matters, including the resolution of a case related to a 2014 oil release and a challenge to a new PHMSA penalty - A Consent Decree was entered in September 2024 to resolve a civil penalty and natural resource damages claim from a 2014 crude oil release, with payments totaling approximately **$2.5 million**[348](index=348&type=chunk) - The Partnership is challenging a Notice of Probable Violation from PHMSA related to a 2020 incident, which includes a proposed civil penalty of approximately **$2.5 million**[350](index=350&type=chunk) [ITEM 1A. RISK FACTORS](index=78&type=section&id=ITEM%201A.%20RISK%20FACTORS) There have been no material changes to the risk factors previously disclosed in the company's 2023 Annual Report and Q1 2024 Quarterly Report - **No material changes** from the risk factors described in the Annual Report on Form 10-K for the year ended December 31, 2023, and the Q1 2024 Form 10-Q have occurred[353](index=353&type=chunk) [ITEM 6. EXHIBITS](index=79&type=section&id=ITEM%206.%20EXHIBITS) This section lists the exhibits filed with the report, including Sarbanes-Oxley certifications and interactive data files

Financial Data and Key Metrics Changes - For Q3 2024, adjusted EBITDA was $3.96 billion, up from $3.54 billion in Q3 2023, indicating strong operational performance [6] - DCF attributable to partners was $1.99 billion, consistent with the same quarter last year [7] - The company spent approximately $1.7 billion on organic growth capital in the first nine months of 2024 [7] Segment Performance Changes - NGL and Refined Products segment adjusted EBITDA was $1.01 billion, down from $1.08 billion in Q3 2023, primarily due to lower gains from hedged NGL inventory [8] - Midstream segment adjusted EBITDA increased to $816 million from $631 million year-over-year, driven by higher volumes in the Permian Basin and Eagleford [9] - Crude Oil segment adjusted EBITDA rose to $768 million from $706 million, supported by record transportation throughput and a 49% increase in crude oil exports [10] - Interstate Natural Gas segment adjusted EBITDA decreased to $460 million from $491 million, affected by lower IT utilization due to lower gas prices [11] - Intrastate Natural Gas segment adjusted EBITDA increased to $329 million from $244 million, mainly due to increased pipeline optimization gains [12] Market Data and Key Metrics Changes - The company is experiencing significant demand for natural gas, particularly from AI datacenters and power plants, with requests to connect to approximately 45 power plants and over 40 prospective datacenters [21][23] - The anticipated rise in natural gas demand is expected to benefit the company due to its extensive pipeline network [28] Company Strategy and Industry Competition - The company is focusing on organic growth capital expenditures of approximately $2.9 billion for 2024, primarily in NGL and Refined Products and Midstream segments [16] - Recent acquisitions, including WTG, are expected to enhance operations and create synergies [13][14] - The company is well-positioned to capitalize on the growing demand for natural gas, particularly in Texas and the Midwest [22][28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing strong demand for natural gas and the company's ability to meet this demand through its infrastructure [21][28] - The company maintains a strong liquidity position and is focused on funding organic growth opportunities while reducing leverage [29] Other Important Information - The company is progressing on several growth projects, including expansions in NGL export capacity and processing facilities in the Permian Basin [16][18] - The company expects to maintain adjusted EBITDA guidance for 2024 between $15.3 billion and $15.5 billion [27] Q&A Session Summary Question: Impact of new demand from datacenters and power plants - Management highlighted the significant opportunities arising from the demand for natural gas due to the growth of datacenters and power plants, emphasizing their strategic positioning to capitalize on this trend [32][34] Question: Status of South Mississippi pipeline and growth CapEx outlook - Management noted the high demand for natural gas on the East Coast and expressed excitement about the potential growth opportunities from the South Mississippi pipeline project [38] Question: Update on WTG acquisition and SUN joint venture - Management reported positive integration progress with WTG and highlighted the benefits of the SUN joint venture, which enhances their presence in the Permian Basin [45][46] Question: Competitive dynamics and returns on new projects - Management stated that they maintain their return hurdles across all projects and are confident in achieving favorable returns from new opportunities, particularly in Texas [50] Question: Guidance for Q4 and potential headwinds - Management indicated no significant headwinds for Q4, maintaining a conservative outlook while acknowledging potential optimization opportunities [56] Question: Future processing capacity announcements - Management confirmed ongoing projects and expansions in processing capacity, emphasizing their focus on meeting future demand from the Permian Basin [61] Question: Update on Sabina pipeline project - Management provided an update on the Sabina pipeline, indicating excitement about its potential and expected revenues starting in Q1 of next year [68]

ENERGY 。TRANSFER Moving America's Energy Q3 2024 Earnings November 6, 2024 Forward-looking Statements / Legal Disclaimer Management of Energy Transfer LP (ET) will provide this presentation in conjunction with ET's 3rd quarter 2024 earnings conference call. On the call, members of management may make statements about future events, outlook and expectations related to Sunoco LP (SUN), USA Compression Partners, LP (USAC), and ET (collectively, the Partnerships), and their subsidiaries and this presentation ma ...

Financial Performance - Net income attributable to partners for Q3 2024 was $1.18 billion, with net income per common unit (basic) at $0.33[1] - Revenue for Q3 2024 was $20.772 billion, slightly up from $20.739 billion in Q3 2023[14] - Net income attributable to partners increased significantly to $1.183 billion in Q3 2024 from $584 million in Q3 2023[14] - Adjusted EBITDA for Q3 2024 was $3.96 billion, up from $3.54 billion in Q3 2023[2] - Adjusted EBITDA for Q3 2024 was $3.959 billion, compared to $3.541 billion in Q3 2023[16] - Consolidated Adjusted EBITDA for Energy Transfer LP reached $3,959 million in Q3 2024, compared to $3,541 million in Q3 2023[22] - Operating income for Q3 2024 was $2.181 billion, slightly down from $2.233 billion in Q3 2023[14] - Interest expense increased to $828 million in Q3 2024 from $632 million in Q3 2023[14] - Depreciation, depletion, and amortization expenses rose to $1.324 billion in Q3 2024 from $1.107 billion in Q3 2023[14] - Net income per common unit (basic) increased to $0.33 in Q3 2024 from $0.15 in Q3 2023[14] - Total distributions to partners for Q3 2024 were $1.105 billion, up from $984 million in Q3 2023[16] - Maintenance capital expenditures increased to $392 million in Q3 2024 from $202 million in Q3 2023[16] Cash Flow and Distributions - Distributable Cash Flow attributable to partners for Q3 2024 was $1.99 billion, a $4 million increase from Q3 2023[2] - Distributable Cash Flow for Q3 2024 was $2.631 billion, up from $2.513 billion in Q3 2023[16] - Distributable Cash Flow attributable to partners increased due to higher realized natural gas sales and pipeline optimization, contributing $100 million[25] - Energy Transfer announced a cash distribution of $0.3225 per common unit ($1.29 annualized) for Q3 2024[5] - Total distributions to partners for Q3 2024 were $1.105 billion, up from $984 million in Q3 2023[16] Segment Performance - Intrastate transportation and storage segment Adjusted EBITDA increased to $329 million in Q3 2024, up from $244 million in Q3 2023[24] - Interstate transportation and storage segment Adjusted EBITDA decreased to $460 million in Q3 2024, down from $491 million in Q3 2023, primarily due to higher operating expenses[26] - Midstream segment Adjusted EBITDA increased to $816 million in Q3 2024, up from $631 million in Q3 2023, driven by higher gathered volumes and NGL production[28] - NGL and refined products transportation and services segment Adjusted EBITDA decreased to $1,012 million in Q3 2024, down from $1,076 million in Q3 2023, despite higher transportation volumes[31] - Crude oil transportation and services segment Adjusted EBITDA increased to $768 million in Q3 2024, up from $706 million in Q3 2023[22] - NGL and refined products transportation and services segment Adjusted EBITDA decreased by $70 million due to a $100 million decrease in marketing margin, partially offset by a $25 million increase in terminal services margin and an $8 million increase in transportation margin[33] - Crude oil transportation and services segment Adjusted EBITDA increased by $121 million, primarily due to a $150 million contribution from recently acquired assets and the Permian joint venture with Sunoco LP[36] - Investment in Sunoco LP segment Adjusted EBITDA increased by $237 million, driven by acquisitions of NuStar and Zenith European terminals, partially offset by higher operating and administrative expenses[39] - Investment in USAC segment Adjusted EBITDA increased by $20 million due to higher revenue-generating horsepower and market-based rates on compression services[41] - All Other segment Adjusted EBITDA decreased by $49 million, primarily due to intersegment eliminations from the formation of the Permian joint venture[42] Volumes and Production - Crude oil transportation volumes increased by 25%, and crude oil exports rose by 49% in Q3 2024[3] - Midstream gathered volumes and produced volumes increased by 6% and 26%, respectively, in Q3 2024[3] - Gathered volumes in the midstream segment increased to 21,027 BBtu/d in Q3 2024, up from 19,825 BBtu/d in Q3 2023, driven by higher Permian region activity[28] - NGL transportation volumes increased to 2,237 MBbls/d in Q3 2024, up from 2,161 MBbls/d in Q3 2023, primarily due to higher Permian region volumes[31] - Crude oil transportation volumes increased to 7,025 MBbls/d in Q3 2024 from 5,640 MBbls/d in Q3 2023, driven by growth in gathering systems and contributions from recently acquired assets[35] Acquisitions and Investments - Energy Transfer completed the acquisition of WTG Midstream, adding 6,000 miles of gas gathering pipelines and 1.5 Bcf/d of processing capacity[4] - Investment in Sunoco LP contributed $456 million to Adjusted EBITDA in Q3 2024, up from $257 million in Q3 2023[22] - Investment in Sunoco LP segment Adjusted EBITDA increased by $237 million, driven by acquisitions of NuStar and Zenith European terminals, partially offset by higher operating and administrative expenses[39] - The company owns 36.4% of the Bakken Pipeline, 60% of Bayou Bridge, and 87.7% of Permian Express Partners, among other non-wholly owned subsidiaries[53] Credit and Liquidity - As of September 30, 2024, the Partnership had $3.34 billion available under its revolving credit facility[5] - The company's revolving credit facility has $3.336 billion available out of a $5 billion facility, with a maturity date of April 11, 2027[45] Assets and Liabilities - Total assets as of September 30, 2024, were $124.43 billion, up from $113.70 billion as of December 31, 2023[13] Non-Wholly Owned Subsidiaries - Total Adjusted EBITDA related to unconsolidated affiliates was $181 million in Q3 2024, compared to $182 million in Q3 2023[48] - The company's proportionate share of Adjusted EBITDA from non-wholly owned subsidiaries was $400 million in Q3 2024, up from $326 million in Q3 2023[52] - Adjusted EBITDA of non-wholly owned subsidiaries reflects the total Adjusted EBITDA on an aggregated basis[54] - Proportionate share of Adjusted EBITDA of non-wholly owned subsidiaries reflects the amount attributable to the company's ownership interest[54] - Distributable Cash Flow of non-wholly owned subsidiaries reflects the total Distributable Cash Flow on an aggregated basis[54] - Proportionate share of Distributable Cash Flow of non-wholly owned subsidiaries reflects the amount attributable to the company's ownership interest[54] - Ownership percentage reflects the total economic interest held by the company and its subsidiaries[54] Capital Projects - The Partnership approved construction of its ninth fractionator at Mont Belvieu, with a capacity of 165,000 Bbls/d, expected to be operational in Q4 2026[3]

Core Viewpoint - Energy Transfer LP (ET) is anticipated to show improvements in both revenue and earnings for the third quarter of 2024, with a report scheduled for November 6, after market close [1][3]. Revenue and Earnings Estimates - The Zacks Consensus Estimate for ET's third-quarter revenues is $24.23 billion, reflecting a 16.81% increase from the previous year [3]. - The consensus estimate for earnings is 32 cents per unit, indicating a year-over-year growth of 3.3% [3]. Earnings Surprise History - Energy Transfer has beaten the Zacks Consensus Estimate in two of the last four quarters, with an average surprise of 5.15% [4]. Earnings Prediction Model - The model suggests a likely earnings beat for Energy Transfer, supported by a positive Earnings ESP of +7.29% [5]. Factors Influencing Q3 Earnings - Earnings are expected to benefit from organic expansion projects and strategic acquisitions, particularly the WTG acquisition, which enhanced ET's natural gas pipeline and processing network in the Permian Basin [7]. - The company's extensive pipeline network across major production basins in the U.S. is likely to contribute to diverse earnings sources [8]. - Strong export volumes of liquefied petroleum gas and the expansion of natural gas liquids (NGL) export facilities are anticipated to positively impact performance [9]. Price Performance and Valuation - ET's units have appreciated by 30.1% over the past year, outperforming the industry average of 27.4% [10]. - The current trailing 12-month EV/EBITDA ratio for ET is 10.58X, lower than the industry average of 11.98X, indicating relative affordability [12]. Investment Thesis - Energy Transfer's extensive pipeline network and ongoing expansion through organic growth and strategic acquisitions position the company favorably to serve domestic producers and enhance NGL exports [14]. - The company is increasing processing capacity in the Permian region to meet rising demand [14]. Summary - Energy Transfer is benefiting from rising demand and effective utilization of its assets across the U.S., with strategic acquisitions enhancing performance [16].

With just one subscription to Beyond the Wall Investing , you can save thousands of dollars a year on equity research reports from banks. You'll keep your finger on the pulse and have access to the latest and highest-quality analysis of this type of information.Energy Transfer LP (NYSE: ET ) is one of the biggest energy transporter companies in the US and is predominantly involved in transporting and holding natural gas, crude oil, and refined fuels. The firm maintains a vastHe leads the investing group Bey ...