Plains All American Pipeline(US:PAA)2025-11-07 21:40Financial Performance - Net income attributable to PAA for the nine months ended September 30, 2025, was $1.093 billion, a 49% increase from $736 million in the same period of 2024[133]. - Product sales revenues for the three months ended September 30, 2025, were $11.150 billion, a decrease of 7% compared to $12.021 billion in 2024; for the nine months, revenues were $32.389 billion, down 9% from $35.606 billion[135]. - Services revenues for the nine months ended September 30, 2025, increased by 5% to $1.309 billion, compared to $1.248 billion in 2024, driven by higher pipeline volumes and tariff escalations[135]. - Net income from continuing operations for the three months ended September 30, 2025, was $453 million, a 129% increase from $198 million in 2024[135]. - The company reported a basic and diluted net income per common unit of $1.25 for the nine months ended September 30, 2025, compared to $0.77 in 2024, reflecting a 62% increase[135]. - For the three months ended September 30, 2025, net income increased by 70% to $529 million compared to $312 million in the same period of 2024[156]. - Adjusted EBITDA for the nine months ended September 30, 2025, was $2,499 million, reflecting a 2% increase from $2,459 million in 2024[156]. - Adjusted EBITDA for Q3 2025 was $806 million, a slight increase of $1 million or 0% compared to Q3 2024, while for the nine months ended September 30, 2025, it rose to $2,499 million, up $40 million or 2% from the previous year[157]. Expenses and Costs - Interest expense for the three months ended September 30, 2025, was $135 million, up from $113 million in 2024, primarily due to new senior notes issuances totaling $2.25 billion[147]. - General and administrative expenses for the nine months ended September 30, 2025, increased due to transaction costs from recent acquisitions, partially offset by lower information systems costs[141]. - The company reported a 15% increase in interest expense, net of certain items, for the nine months ended September 30, 2025, totaling $330 million compared to $287 million in 2024[156]. - Interest expense for Q3 2025 was $109 million, an increase of $15 million or 16% compared to Q3 2024, and for the nine months, it rose to $320 million, up $46 million or 17%[157]. - The company experienced a $92 million loss on asset sales from continuing operations for the three months ended September 30, 2025[156]. - Maintenance capital expenditures from continuing operations decreased by $14 million or 28% in Q3 2025, totaling $36 million, while for the nine months, it decreased by $28 million or 20% to $112 million[157]. Cash Flow and Distributions - Adjusted Free Cash Flow for the nine months ended September 30, 2025, was $344 million, down from $882 million in 2024, indicating a decrease in available cash after distributions[177]. - Cash distributions paid during the period presented were $110 million in Q3 2025, a decrease of $3 million or 3% compared to Q3 2024, and for the nine months, it increased by $29 million or 9% to $339 million[157]. - Cash distributions paid to noncontrolling interests during the nine months ended September 30, 2025, totaled $339 million, compared to $310 million in 2024, reflecting an increase in distributions[177]. - Implied DCF available to common unitholders for Q3 2025 was $431 million, an increase of $3 million or 1% from Q3 2024, and for the nine months, it increased by $54 million or 4% to $1,357 million[157]. Investments and Acquisitions - The company is divesting its Canadian NGL Business to focus on core midstream crude oil operations, with the transaction expected to close in Q1 2026[131]. - The company recognized a net gain of $31 million from the acquisition of the remaining 50% interest in Cheyenne in Q1 2025[145]. - Acquisition capital for 2025 included significant transactions such as the acquisition of Ironwood Midstream and Medallion Midstream, totaling $832 million[181]. - The company acquired 100% of the entity that owns the EPIC Pipeline for approximately $2.9 billion, including $1.1 billion of debt assumed[203]. - The company repurchased 0.5 million common units for a total price of $8 million during the nine months ended September 30, 2025, with remaining capacity under the repurchase program at $190 million[193]. Market Conditions and Risks - The average NYMEX Price for crude oil in the three months ended September 30, 2025, was $65 per barrel, down from $75 in 2024; for the nine months, it was $67, compared to $78 in 2024[138]. - The company is exposed to various market risks, including commodity price risk, interest rate risk, and currency exchange rate risk[211]. - The company utilizes crude oil derivatives to hedge price risk associated with its pipeline, terminalling, and merchant activities[212]. - The company anticipates significant uncertainties in its estimates of crude oil and other purchases, totaling approximately $112.32 billion over the next several years[203]. Segment Performance - The Crude Oil segment generates revenue through tariffs, pipeline capacity agreements, and transportation fees, with results impacted by commodity price volatility and lease gathering crude oil purchase volumes[159]. - Crude Oil segment revenues for Q3 2025 were $11,559 million, a decrease of 7% compared to $12,444 million in Q3 2024[162]. - Segment Adjusted EBITDA for the Crude Oil segment increased by 3% to $593 million in Q3 2025 from $577 million in Q3 2024[163]. - Average daily volumes for the Crude Oil pipeline tariff increased by 8% to 9,883 thousand barrels per day in Q3 2025 compared to 9,166 thousand barrels per day in Q3 2024[170]. - NGL segment revenues for Q3 2025 were $24 million, an increase of 20% compared to $20 million in Q3 2024[170]. - The NGL segment Adjusted EBITDA loss improved by 33% to $(10) million in Q3 2025 from $(15) million in Q3 2024[171].