MPLX LP (NYSE:MPLX) Q1 2017 Earnings Conference Call - Preliminary Transcript
Apr 27, 2017 • 11:00 am ET
Welcome to the MPLX Earnings Call. My name is Cynthia, and I will be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Please note that this conference is being recorded.
I will now turn the call to Lisa Wilson, Director of Investor Relations. Lisa, you may begin.
Thanks, Cynthia. Good morning and welcome to the MPLX's First Quarter 2017 Earnings Webcast and Conference Call. The synchronized slides that accompany this call can be found on mplx.com, under the Investors tab. On the call today are Gary Heminger, Chairman and CEO; Don Templin, President; Pam Beall, Chief Financial Officer, and other members of the management team.
We invite you to read the Safe Harbor statements and non-GAAP disclaimer on slide two. It is a reminder that we will be making forward-looking statements during the call and the question-and-answer session that follows. Actual results may differ materially from what we expect today. Factors that could cause actual results to differ are included there, as well as in our filings with the SEC.
Now, I will turn the call over to Gary Heminger for opening remarks, on slide three. Gary?
Thanks, Lisa. Good morning and thank you for joining our call. Earlier today, MPLX reported solid operational and financial results for the quarter, with adjusted EBITDA of $423 million, and distributable cash flow of $354 million. The partnership continues to pursue and execute on a number of strategic growth opportunities supporting a diverse set of producer customers in some of the nation's most prolific shale plays. We're also excited about the progress we are making related to the strategic actions we announced earlier this year. We completed the first of several planned dropdowns from MPC on March 1. Work to prepare the remaining assets for dropdown to MPLX remains on schedule. In conjunction with the completion of the dropdowns, we expect to exchange newly issued MPLX common units through MPC's general partner economic interests, including incentive distribution rights.
All of these transactions are subject to requisite approvals, market and other conditions, including tax and other regulatory clearances. These strategic actions are expected to double the size of the partnership, lower our cost of capital, and enhance our long-term distribution growth capabilities, all while maintaining an investment-grade profile. Looking forward, we expect to deliver compelling value to our investors by building our backlog of organic growth opportunities, pursuing third-party acquisitions, and continuing our sharp focus on customer service.
Now, I'll turn the call over to Don to review our quarterly operational highlights. Don?
Thanks, Gary. Moving to slide four, I'm pleased to report the completion of several strategic transactions during the quarter that provide additional sources of fee-based revenues, and expand the footprint of our Logistics and Storage segment. In addition to the dropdown assets Gary referred to earlier, we acquired an indirect equity interest in the Bakken pipeline system. This system will have the capacity to deliver in excess of