Energy Transfer LP (NYSE:ET) Q3 2019 Earnings Conference Call - Final Transcript

Nov 07, 2019 • 09:00 am ET


Energy Transfer LP (NYSE:ET) Q3 2019 Earnings Conference Call - Final Transcript


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Greetings ladies and gentlemen and welcome to Energy Transfer Third Quarter 2019 Earnings Conference Call. [Operator Instructions]

It is now my pleasure to introduce your host Mr. Tom Long. Thank you you may begin.

Thomas E. Long

Thank you operator, good morning everyone and welcome to the Energy Transfer Third Quarter 2019 Earnings Call. And thank you for joining us today. I'm also joined today by Kelcy Warren Mackie McCrea and other members of the senior management team who are here to help answer your questions after our prepared remarks. Just as a reminder, we will be making forward looking statements within the meaning of Section 21 A of the Securities Exchange Act of 1934. These are based on our beliefs as well as certain assumptions and information currently available to us and also referred to it yesterday but doc distributable can flow or DPF and distribution coverage ratio, all of which are non gap financial measures will find the reconciliation of the non GAAP measures on our website. Let's start with a few highlights. As we look at the business, the third quarter was another strong quarter. Our businesses doing very well as we benefit from a franchise that is fully integrated across the midstream value chain from wellhead to market. We are delivering high return projects with strong cash flows. On the financial side adjusted EBITDA for the third quarter of 2019 was $2.8 billion this was up 8% compared to the third quarter of last year. DCF attributable to the partners of ET as adjusted was $1.5 billion which was an increase of approximately 10% over the same period last year.

The NGL & Refined Products segment delivered another record quarter as a result of the ramp up of Mariner East II and record frac volumes that were driven by Frac VI coming online and our other major businesses delivered solid performances with increased volumes across the majority of those segments. Distribution coverage for the quarter was 1.9x which resulted in excess cash flow after distributions of $712 million for the quarter. Year-to-date our excess cash flow after distributions totaled approximately $2.4 billion. This excess cash flow plus the Series E preferred units issued in April has allowed us to fund year-to-date growth capital expenditures without the issuance of common equity or debt. During the third quarter we successfully brought on Arrowhead III processing plant online bringing our total processing capacity in the Permian Basin to approximately 2.5 Bcf per day. In addition Phase 2 of our Red Bluff Express Pipeline is now complete. The J.C. Nolan Pipeline went into service in August and Permian Express 4 went into full service October 1. And in September we announced the entry into a merger agreement with SemGroup which I will discuss in more detail shortly. For 2019 we have increased our adjusted EBITDA guidance range to $11 billion to $11.1 billion. We are lowering our full year 2019 growth capital guidance to approximately $4 billion. For 2020 we expect organic growth capital