Enterprise Q2 Earnings Beat Estimates, Revenues Decrease Y/Y

Core Insights - Enterprise Products Partners LP (EPD) reported second-quarter 2025 adjusted earnings per limited partner unit of 66 cents, surpassing the Zacks Consensus Estimate of 65 cents and increasing from 64 cents in the prior year [1][9] - Total quarterly revenues were $11.4 billion, falling short of the Zacks Consensus Estimate of $14.2 billion and down from $13.5 billion in the same quarter last year [1][9] - The strong earnings performance was primarily driven by record natural gas processing and pipeline volumes [2][9] Segmental Performance - Pipeline volumes for NGL, crude oil, refined products, and petrochemicals reached 8.2 million barrels per day (bpd), up from 7.8 million bpd in the year-ago quarter [3] - Natural gas pipeline volumes increased to 20.4 trillion British thermal units per day (TBtus/d), compared to 18.7 TBtus/d in the previous year [3] - Marine terminal volumes decreased to 2.1 million bpd from 2.2 million bpd in the prior-year period [3] Operating Margins - The gross operating margin for NGL Pipelines & Services remained stable at $1.3 billion, attributed to higher processing volumes despite minor mark-to-market (MTM) hedging losses [4] - Natural Gas Pipelines and Services saw a decrease in gross operating margin to $341 million from $386 million, primarily due to MTM hedging losses and lower margins in Permian and Rockies facilities [4] - Crude Oil Pipelines & Services reported a gross operating margin of $403 million, down from $417 million, due to lower sales volumes and margins [5] - Petrochemical & Refined Products Services experienced a decline in gross operating margin to $354 million from $392 million, impacted by lower margins in octane enhancement [5] Cash Flow - Distributable cash flow totaled $1.9 billion, up from $1.8 billion in the year-ago period, with a coverage ratio of 1.6X [6] - The company retained $748 million of distributable cash flow in the second quarter and generated adjusted free cash flow of $2.1 billion, flat year over year [6] Financials - Total capital investment for the reported quarter was $1.3 billion [7] - As of June 30, 2025, total outstanding debt principal was $33.1 billion, with consolidated liquidity of approximately $5.1 billion [7] Outlook - For 2025, EPD anticipates growth capital expenditures to remain in the range of $4.0-$4.5 billion [8] - Sustaining capital expenditure is expected to be approximately $525 million in 2025 [8]