Enterprise Products Partners L.P.(US:EPD)2024-08-09 14:43Financial Performance - For the three months ended June 30, 2024, consolidated revenues were $13,483 million, compared to $10,651 million for the same period in 2023, representing a 26.5% increase [182]. - The cost of sales for the three months ended June 30, 2024, was $10,184 million, compared to $7,679 million in the same period of 2023, reflecting a 32.0% increase [182]. - Operating income for the three months ended June 30, 2024, was $1,765 million, compared to $1,579 million in Q2 2023, indicating an increase of 11.8% [182]. - Net income attributable to common unitholders for the three months ended June 30, 2024, was $1,405 million, compared to $1,253 million in the same period of 2023, a rise of 12.1% [182]. - Total consolidated revenues for Q2 2024 increased to $13.483 billion, up from $10.651 billion in Q2 2023, representing a 26.5% increase [183]. - Total operating costs and expenses for Q2 2024 increased by $2.6 billion compared to Q2 2023 [188]. - Total operating costs and expenses for the six months ended June 30, 2024, increased by $4.8 billion compared to the same period in 2023 [188]. - Operating income for Q2 2024 increased by $186 million compared to Q2 2023, driven by revenue growth [195]. - Total gross operating margin for Q2 2024 was $2.412 billion, up from $2.181 billion in Q2 2023, while for the six months ended June 30, 2024, it was $4.902 billion compared to $4.516 billion in the same period last year [203]. Revenue Sources - Marketing revenues increased by $2.7 billion in Q2 2024, primarily driven by higher sales volumes and average sales prices [184]. - Revenues from NGLs, crude oil, and petrochemicals and refined products increased a combined $5.4 billion for the six months ended June 30, 2024, compared to the same period in 2023 [186]. - Revenues from the marketing of NGLs, crude oil, and petrochemicals and refined products increased by a combined $2.9 billion quarter-to-quarter, driven by higher sales volumes ($2.1 billion) and higher average sales prices ($814 million) [184]. - Revenues from midstream services for Q2 2024 increased by $104 million compared to Q2 2023, with natural gas pipeline revenues rising by $40 million due to higher average transportation fees [185]. - Revenues from natural gas processing facilities increased by $100 million for the six months ended June 30, 2024, primarily due to increased equity NGL-equivalent production volumes [187]. Capital Investments - Total capital investments for 2024 are expected to be between $4.1 billion and $4.35 billion, including growth capital investments of $3.5 billion to $3.75 billion [284]. - The company placed two natural gas processing trains into service in the Permian Basin and is scheduled to complete approximately $6.7 billion of growth capital projects by the end of 2026 [284]. - Capital investments for growth projects increased by $710 million from the previous period, totaling $1,937 million for the six months ended June 30, 2024, compared to $1,227 million in the same period of 2023 [288]. - Sustaining capital projects saw an increase of $168 million, reaching $374 million for the six months ended June 30, 2024, up from $206 million in the prior year [289]. - Investments in ethane, ethylene, and LPG export expansion projects at Gulf Coast terminals accounted for a $291 million increase in capital expenditures [290]. Debt and Liquidity - The average maturity of the company's consolidated debt obligations was approximately 18.1 years as of June 30, 2024, with total consolidated debt of $30.621 billion [264]. - At June 30, 2024, the company had $3.4 billion of consolidated liquidity, including $3.3 billion of available borrowing capacity and $138 million of unrestricted cash [260]. - The total amount of Guaranteed Debt as of June 30, 2024, was $31.1 billion, including $27.4 billion of senior notes and $2.3 billion of junior subordinated notes [294]. Cash Flow and Distributions - Net cash flow provided by operating activities increased by $200 million for the six months ended June 30, 2024, compared to the same period in 2023 [272]. - Cash distributions paid to common unitholders for the three months ended June 30, 2024, were $1,151 million, up from $1,096 million in the same period of 2023 [282]. - The company declared a quarterly cash distribution of $0.525 per common unit for Q2 2024, totaling $1.15 billion, including $11 million for distribution equivalent rights [262]. - Distributable Cash Flow (DCF) for the three months ended June 30, 2024, was $1,812 million, an increase from $1,735 million in the same period of 2023 [282]. - The distribution coverage ratio for the three months ended June 30, 2024, was 1.6x, consistent with the previous year [282]. Operational Highlights - The construction of a fourth refrigeration train at the Enterprise Hydrocarbon Terminal is expected to increase LPG export capacity by approximately 300 MBPD by the end of 2026 [162]. - A second natural gas processing train at Mentone West is planned, with a capacity to process over 300 MMcf/d and extract more than 40 MBPD of NGLs, expected to begin service in the first half of 2026 [165]. - The third natural gas processing train at Mentone and the seventh at Leonidas are now operational, each capable of processing over 300 MMcf/d and extracting more than 40 MBPD of NGLs [166]. - The Texas Western Products System has begun initial service, featuring 900,000 barrels of storage for gasoline and diesel, with truck loading capacity of 10 MBPD [168]. - The Sea Port Oil Terminal project received a deepwater port license, designed to load Very Large Crude Carriers at rates of approximately 85,000 barrels per hour, with an onshore storage capacity of 4.8 MMBbls [163][164]. Market Conditions - Inflation rates in the U.S. remain elevated in 2024, impacting costs, but the company has provisions in contracts to mitigate these effects [179]. - The company aims to reduce commodity price exposure through hedging activities and fee-based arrangements [178]. - The average indicative gas processing gross spread for 2023 was $0.37 per gallon, with a projected average of $0.43 per gallon for 2024 [173]. - Average WTI crude oil price for Q2 2024 was $80.57 per barrel, compared to $73.78 per barrel in Q2 2023, marking a 9.7% increase [175].