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Enterprise Reports Record Results for Second Quarter 2018

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Enterprise Products Partners L.P. ("Enterprise") (NYSE:EPD) today
announced its financial results for the three months ended June 30, 2018.

Second Quarter 2018 Highlights

    Three months ended June 30,
($ in millions, except per unit amounts) 2018     2017
Operating income $ 986     $ 939
Net income $ 687 $ 666
Fully diluted earnings per unit $ 0.31 $ 0.30
Net cash flow provided by operating activities $ 1,464 $ 1,459
Total gross operating margin (1) $ 1,478 $ 1,378
Adjusted EBITDA (1) $ 1,767 $ 1,338
Distributable cash flow (1) $ 1,431 $ 1,052
             
(1)   Total gross operating margin, adjusted earnings before interest,
taxes, depreciation and amortization ("Adjusted EBITDA") and
distributable cash flow are non-generally accepted accounting
principle ("non-GAAP") financial measures that are defined and
reconciled later in this press release.
  • Net income for the second quarter of 2018 was reduced by $322 million,
    or $0.15 per unit on a fully diluted basis, of non-cash mark-to-market
    losses. Substantially all of these mark-to-market losses were incurred
    in connection with our hedging activities related to the
    Midland-to-ECHO Pipeline.
  • Adjusted EBITDA increased 32 percent to a record $1.8 billion for the
    second quarter of 2018 compared to $1.3 billion for the second quarter
    of 2017.
  • Enterprise increased its cash distribution with respect to the second
    quarter of 2018 by 2.4 percent to $0.43 per unit compared to the
    distribution paid with respect to the second quarter of 2017. The
    distribution will be paid August 8, 2018 to unitholders of record as
    of the close of business on July 31, 2018.
  • Enterprise reported distributable cash flow of $1.4 billion for the
    second quarter of 2018, which provided 1.5 times coverage of the $0.43
    per unit cash distribution and resulted in $491 million of retained
    distributable cash flow. Likewise, distributable cash flow of $2.8
    billion for the first six months of 2018 provided 1.5 times coverage
    of the aggregate $0.8575 per unit cash distribution and resulted in
    $948 million of retained distributable cash flow. Retained
    distributable cash flow is available to reinvest in growth capital
    projects and reduces our need to issue additional equity.
  • Affiliates of privately held Enterprise Products Company ("EPCO"),
    which collectively own Enterprise's general partner and approximately
    32 percent of Enterprise's outstanding limited partner interests at
    June 30, 2018, have indicated to Enterprise management that they plan
    to purchase $106 million of Enterprise common units through the
    partnership's distribution reinvestment plan ("DRIP") in connection
    with the August 2018 distribution.
  • Second Quarter Volume Highlights
    Three months ended June 30,
2018     2017
NGL, crude oil, refined products & petrochemical pipeline volumes (million
BPD)

6.2

   

5.4

Marine terminal volumes (million BPD) 1.7 1.4
Natural gas pipeline volumes (TBtu/d) 13.7 12.2
NGL fractionation volumes (MBPD) 927 841
Propylene plant production volumes (MBPD) 100 81
Fee-based natural gas processing volumes (Bcf/d) 4.6 4.7
Equity NGL production volumes (MBPD)     164     164

As used in this press release, "NGL" means natural gas liquids, "BPD"
means barrels per day, "MBPD" means thousand barrels per day, "Bcf/d"
means billion cubic feet per day; and "TBtu/d" means trillion British
thermal units per day.

  • Capital investments were $983 million in the second quarter of 2018,
    and $2.1 billion for the first six months of 2018. Included in these
    investments were sustaining capital expenditures of $73 million in the
    second quarter of 2018 and $139 million in the first six months of
    2018.

"We are very pleased with the performance of our businesses during the
second quarter of 2018," said A. J. "Jim" Teague. "We set fourteen
financial and operational performance records during the quarter. We
benefited from $5.3 billion of assets being placed in service since the
second quarter of 2017, strong volume growth across our integrated
system of assets and the impact of higher NGL prices on our natural gas
processing business."

"Our PDH facility, which completed commissioning activities and began
commercial service in the second quarter, operated at full capacity. The
Midland-to-ECHO crude oil pipeline averaged 545 thousand barrels per day
of gross transportation volumes from the Permian Basin. In total, our
liquid pipeline volumes were a record 6.2 million barrels per day and
our marine terminal volumes were a record 1.7 million barrels per day.
This operational performance generated record distributable cash flow,
excluding proceeds from asset sales, of $1.4 billion, which provided 1.5
times coverage of our distribution for the quarter. We retained $491
million of distributable cash flow to reinvest in the growth of the
partnership, which supports our goal of self-funding the equity portion
of our growth capital investment," stated Teague.

"During the second quarter, we began operations at our ninth NGL
fractionator at Mont Belvieu and Orla I natural gas processing plant in
the Delaware Basin. We currently have $5.2 billion of growth projects
under construction that are scheduled to be completed by the end of
2019. We are continuing to make good progress in developing the next
tranche of organic projects."

Review of Second Quarter 2018 Results

NGL Pipelines & Services – Gross operating margin from the
NGL Pipelines & Services segment increased 20 percent, or $154 million,
to a record $914 million for the second quarter of 2018 from $760
million for the second quarter of 2017.

Enterprise's natural gas processing and related NGL marketing business
generated a 51 percent increase in gross operating margin to $310
million for the second quarter of 2018 compared to $205 million for the
second quarter of 2017. Enterprise's natural gas processing plants
accounted for $81 million of this increase in gross operating margin.
Natural gas processing plants that have been in service longer than
twelve months reported a $70 million increase in gross operating for the
second quarter of 2018 compared to the same quarter in 2017 primarily
due to higher processing margins driven by higher NGL prices. Gross
operating margin from our Delaware Basin gas plant increased $6 million
and fee-based processing volumes increased 66 MMcf/d this quarter
primarily due to our acquisition of the remaining 50% equity interest in
this facility in March 2018. In addition, our Orla I gas plant, which
commenced operations in May 2018, contributed gross operating margin of
$5 million and fee-based processing volumes of 122 MMcf/d this quarter.
Gross operating margin from NGL marketing activities increased $24
million primarily due to higher average sales margins, partially offset
by lower sales volumes.

Total fee-based processing volumes were 4.6 Bcf/d in the second quarter
of 2018 compared to 4.7 Bcf/d for the second quarter of last year. The
partnership's equity NGL production was 164 MBPD for both the second
quarters of 2018 and 2017.

Gross operating margin from the partnership's NGL pipelines and storage
business increased $29 million to $465 million for the second quarter of
2018 compared to the second quarter of 2017. NGL pipeline transportation
volumes increased 11 percent to a record 3.4 million BPD for the second
quarter of 2018 from 3.1 million BPD for the same quarter of 2017. NGL
marine terminal volumes increased 26 percent to a record 597 MBPD for
the second quarter of 2018 compared to the same quarter in 2017.

Enterprise's Seminole, Chaparral and affiliated pipelines reported a $25
million increase in gross operating margin to $50 million for the second
quarter of 2018 compared to the second quarter of last year, primarily
due to higher average fees and a 120 MBPD increase in transportation
volumes. Gross operating margin from the ATEX ethane pipeline increased
$13 million to $80 million for the second quarter of 2018 compared to
the second quarter of 2017, primarily due to a 38 MBPD increase in
transportation volumes.

Gross operating margin from the partnership's Mid-America Pipeline
System and related terminals decreased $12 million to $100 million for
the second quarter of this year compared to the same quarter in 2017
primarily due to lower average transportation fees. Transportation
volumes increased 33 MBPD on the Mid-America system. Gross operating
margin from the Dixie Pipeline and related terminals decreased $12
million, primarily as a result of higher maintenance and other operating
costs.

Enterprise's ethane export terminal at Morgan's Point reported a $16
million increase in gross operating margin for the second quarter of
2018 versus the second quarter of last year, primarily due to a 102 MPBD
increase in volumes to 169 MBPD for the second quarter of 2018. The
related Channel Pipeline had a $3 million increase in gross operating
margin due to higher ethane transportation volumes to the partnership's
Morgan's Point facility.

Gross operating margin from the partnership's NGL fractionation business
increased $20 million, or 17 percent, to $139 million for the second
quarter of 2018 compared to $119 million for the second quarter of 2017.
Total NGL fractionation volumes increased 10 percent to a record 927
MBPD in the second quarter of 2018 from 841 MBPD for the second quarter
of 2017.

The Mont Belvieu NGL fractionators reported a $9 million increase in
gross operating margin for the second quarter of 2018 compared to the
second quarter of 2017, primarily due to an 83 MBPD increase in
fractionation volumes and higher fees. The ninth NGL fractionator at
Mont Belvieu began commercial operations in May 2018. Gross operating
margin at the Hobbs NGL fractionator increased $7 million to $15 million
for the second quarter of 2018 compared to the second quarter of last
year due to higher product blending revenues and lower maintenance costs.

Crude Oil Pipelines & Services – Gross operating margin from
the partnership's Crude Oil Pipelines & Services segment was $53 million
for the second quarter of 2018, which included mark-to-market losses on
financial instruments of $338 million primarily related to the widening
crude oil commodity price differentials (basis spreads) between Midland
and Houston and Midland and Cushing. This compares to gross operating
margin of $237 million for the second quarter of 2017, which included
$15.0 million of mark-to-market gains on financial instruments. Total
crude oil pipeline transportation volumes were a record 2.1 million BPD
for the second quarter of 2018 compared to 1.5 million BPD for the
second quarter of 2017. Total crude oil marine terminal volumes
increased 64 percent to a record 802 MBPD for the second quarter of 2018
compared to second quarter of last year. Marine terminal volumes for the
second quarter of 2018 reflect a 76 MBPD (net to our interest) increase
attributable to export activities performed at dock facilities owned by
Seaway, which included the loading of its first Very Large Crude Carrier
("VLCC") tanker vessel at its Texas City terminal in June 2018. Seaway
loaded a second VLCC at its Texas City terminal in July 2018.

Gross operating margin from the Midland-to-ECHO Pipeline and related
marketing activities was a combined loss of $211 million in the second
quarter of 2018. This included $310 million of non-cash mark-to-market
losses on financial instruments executed to hedge the basis spread
between Midland and Houston crude oil prices on approximately 84 MBPD of
uncommitted capacity. These hedges represent approximately 50% of the
pipeline's expected uncommitted capacity through 2020 at an average
value of $2.62 per barrel. These non-cash, mark-to-market losses were
due to the widening of Midland-to-Houston basis spreads to an average of
$14.83 per barrel through 2020 as of June 30, 2018. These non-cash,
mark-to-market losses will reverse as the related hedges are settled and
the physical volumes are delivered. The Midland-to-ECHO Pipeline
averaged 436 MBPD of transportation volumes this quarter, net to our 80
percent interest.

Gross operating margin from other crude oil marketing activities
decreased $26 million for the second quarter of 2018 compared to the
second quarter of 2017, primarily due to non-cash mark-to-market losses
of $28 million in the second quarter of 2018 compared to $15 million of
non-cash mark-to-market gains in the second quarter of 2017. The
mark-to-market losses this quarter were primarily attributable to
widening basis spreads negatively affecting hedges of uncommitted
transportation capacity on the Basin Pipeline from Midland to Cushing.

Enterprise's South Texas Crude Oil Pipeline System reported a $22
million increase in gross operating margin for the second quarter of
2018 compared to the second quarter of 2017, primarily due to
reservation fees of $12 million from a new capacity reservation
agreement with the Midland-to-ECHO Pipeline. Gross operating margin from
our Midland, Texas and ECHO storage terminals increased $12 million
compared to the second quarter of 2017 primarily due to higher
throughput on the Midland-to-ECHO Pipeline and higher storage volumes.
Gross operating margin from crude loadings for export at the Enterprise
Houston Terminal increased $14 million compared to the second quarter of
last year, primarily due to a 203 MBPD increase in volumes.

Natural Gas Pipelines & Services – Enterprise's Natural Gas
Pipelines & Services segment reported gross operating margin of $213
million for the second quarter of 2018 compared to $194 million for the
second quarter of 2017. Total natural gas transportation volumes
increased 12 percent to 13.7 TBtu/d for the second quarter of this year
from 12.2 TBtu/d for the second quarter of last year.

Gross operating margin from the Texas Intrastate System increased $10
million, or 13 percent, to $86 million for the second quarter of 2018,
primarily due to higher firm capacity and other fees. Natural gas
pipeline volumes for this system were 4.6 TBtu/d in the second quarter
of 2018 compared to 4.5 TBtu/d for the same quarter of last year.

Enterprise's Permian Basin Gathering System had a $10 million increase
in gross operating margin for the second quarter of 2018 compared to the
same quarter in 2017 on a 17 percent increase in gathering volumes and
higher fees. Gross operating margin for the second quarter of 2018 from
the partnership's Haynesville Gathering System in Louisiana increased $5
million to $12 million, primarily from a 296 billion British thermal
units per day ("BBtus/d") increase in gathering volumes compared to the
second quarter of 2017.

Gross operating margin from the Acadian Gas System decreased $15 million
in the second quarter of 2018 compared to the second quarter of 2017
primarily due to $17 million of proceeds received in connection with a
legal settlement in the second quarter of 2017. Transportation volumes
on the Acadian Gas System increased 615 BBtus/d, or 28 percent for the
second quarter of 2018 versus the same quarter of 2017. Volumes from the
Haynesville Extension Pipeline accounted for 524 BBtus/d of this
increase in transportation volumes on the Acadian System.

Gross operating margin from natural gas marketing activities increased
$4 million to $11 million for the second quarter compared to the same
quarter last year as a result of higher mark-to-market earnings and
higher average sales margins.

Petrochemical & Refined Products Services – Gross operating
margin for the Petrochemical & Refined Products Services segment
increased 50 percent to a record $282 million for the second quarter of
2018 from $188 million for the second quarter of 2017. Total segment
pipeline transportation volumes were 771 MBPD for the second quarter of
2018 compared to 800 MBPD for the second quarter of 2017.

The partnership's propylene business reported a $65 million, or 104
percent increase in gross operating margin to $127 million for the
second quarter of 2018 from $62 million for the second quarter of 2017.
The propane dehydrogenation ("PDH") facility, which was placed into
service in April 2018, contributed $46 million of gross operating margin
this quarter on plant production volumes, including by-products, of 26
MBPD. Enterprise's legacy propylene fractionators at Mont Belvieu
reported a $16 million increase in gross operating margin for the second
quarter of 2018 compared to the second quarter of 2017, primarily due to
higher average sales margins. Propylene plant production volumes, which
includes production from our PDH and propylene fractionation facilities,
were a record 100 MBPD for this quarter compared to 81 MBPD for the
second quarter of last year.

Gross operating margin for Enterprise's octane enhancement and
high-purity isobutylene business increased $11 million for the second
quarter of this year compared to the second quarter of 2017, primarily
due to higher sales margins and volumes. Total plant production volumes
were 30 MBPD for the second quarters of both 2018 and 2017.

Gross operating margin for Enterprise's butane isomerization and related
operations for the second quarter of 2018 increased $8 million when
compared to the second quarter of 2017, primarily due to higher
by-product sales.

Capitalization

Total debt principal outstanding at June 30, 2018 was $25.9 billion,
including $3.2 billion of junior subordinated notes to which the
nationally recognized debt rating agencies ascribe partial equity
content. At June 30, 2018, Enterprise had consolidated liquidity of
approximately $3.6 billion, which was comprised of available borrowing
capacity under our revolving credit facilities and unrestricted cash on
hand.

Total capital spending in the second quarter of 2018 was $983 million,
which includes $73 million of sustaining capital expenditures. For the
first six months of 2018, Enterprise's capital spending was $2.1 billion
including $139 million of sustaining capital expenditures. For 2018 in
total, we currently expect to invest approximately $3.8 billion to $4.0
billion for growth capital projects, and approximately $315 million for
sustaining capital expenditures.

Conference Call to Discuss Second Quarter 2018
Earnings

Today, Enterprise will host a conference call to discuss second quarter
2018 earnings. The call will be broadcast live over the Internet
beginning at 9:00 a.m. CT and may be accessed by visiting the
partnership's website at www.enterpriseproducts.com.

Use of Non-GAAP Financial Measures

This press release and accompanying schedules include the non-GAAP
financial measures of total gross operating margin, distributable cash
flow and Adjusted EBITDA. The accompanying schedules provide definitions
of these non-GAAP financial measures and reconciliations to their most
directly comparable financial measure calculated and presented in
accordance with GAAP. Our non-GAAP financial measures should not be
considered as alternatives to GAAP measures such as net income,
operating income, net cash flow provided by operating activities or any
other measure of financial performance calculated and presented in
accordance with GAAP. Our non-GAAP financial measures may not be
comparable to similarly-titled measures of other companies because they
may not calculate such measures in the same manner as we do.

Company Information and Use of Forward-Looking
Statements

Enterprise Products Partners L.P. is one of the largest publicly traded
partnerships and a leading North American provider of midstream energy
services to producers and consumers of natural gas, NGLs, crude oil,
refined products and petrochemicals. Our services include: natural gas
gathering, treating, processing, transportation and storage; NGL
transportation, fractionation, storage and export and import terminals;
crude oil gathering, transportation, storage and export and import
terminals; petrochemical and refined products transportation, storage,
export and import terminals and related services; and a marine
transportation business that operates primarily on the United States
inland and Intracoastal Waterway systems. The partnership's assets
include approximately 50,000 miles of pipelines; 260 million barrels of
storage capacity for NGLs, crude oil, refined products and
petrochemicals; and 14 Bcf of natural gas storage capacity.

This press release includes forward-looking statements. Except
for the historical information contained herein, the matters discussed
in this press release are forward-looking statements that involve
certain risks and uncertainties, such as the partnership's expectations
regarding future results, capital expenditures, project completions,
liquidity and financial market conditions.
These risks and
uncertainties include, among other things, insufficient cash from
operations, adverse market conditions, governmental regulations and
other factors discussed in Enterprise's filings with the U.S. Securities
and Exchange Commission.
If any of these risks or uncertainties
materialize, or should underlying assumptions prove incorrect, actual
results or outcomes may vary materially from those expected.
The
partnership disclaims any intention or obligation to update publicly or
reverse such statements, whether as a result of new information, future
events or otherwise.

           

Enterprise Products Partners L.P.

Exhibit A
Condensed Statements of Consolidated Operations – UNAUDITED
($ in millions, except per unit amounts)    
For the Three Months

Ended June 30,

    For the Six Months

Ended June 30,

2018     2017     2018     2017

Revenues

$ 8,467.5 $ 6,607.6 $ 17,766.0 $ 13,928.0

Costs and expenses:

Operating costs and expenses 7,552.0 5,730.2 15,774.7 12,063.4
General and administrative costs   51.4         45.7         104.4         96.1  
Total costs and expenses   7,603.4         5,775.9         15,879.1         12,159.5  

Equity in income of unconsolidated affiliates

  122.3         107.0         238.0         201.8  

Operating income

986.4 938.7 2,124.9 1,970.3

Other income (expense):

Interest expense (274.6 ) (245.8 ) (526.7 ) (495.1 )
Other, net   (6.2 )       (18.2 )       24.0         (23.5 )
Total other expense   (280.8 )       (264.0 )       (502.7 )       (518.6 )

Income before income taxes

705.6 674.7 1,622.2 1,451.7
Provision for income taxes   (18.4 )       (8.7 )       (23.5 )       (14.7 )

Net income

687.2 666.0 1,598.7 1,437.0

Net income attributable to noncontrolling
interests

  (13.4 )       (12.3 )       (24.2 )       (22.6 )

Net income attributable to limited partners

$ 673.8       $ 653.7       $ 1,574.5       $ 1,414.4  
 

Per unit data (fully diluted):

Earnings per unit $ 0.31       $ 0.30       $ 0.72       $ 0.66  
Average limited partner units outstanding (in millions)   2,185.4         2,154.3         2,181.3         2,144.7  
 

Supplemental financial data:

Net cash flows provided by operating activities $ 1,464.2       $ 1,459.3       $ 2,697.8       $ 2,334.9  
Total debt principal outstanding at end of period $ 25,911.7       $ 23,579.6       $ 25,911.7       $ 23,579.6  
 
Non-GAAP distributable cash flow (1) $ 1,430.8       $ 1,051.9       $ 2,821.4       $ 2,180.5  
Non-GAAP Adjusted EBITDA (2) $ 1,767.3       $ 1,338.2       $ 3,453.9       $ 2,752.6  
Gross operating margin by segment:
NGL Pipelines & Services $ 913.7 $ 759.9 $ 1,798.6 $ 1,615.9
Crude Oil Pipelines & Services 52.8 236.7 272.8 501.3
Natural Gas Pipelines & Services 213.4 194.4 411.3 365.3
Petrochemical & Refined Products Services   281.8         188.4         553.7         370.2  
Total segment gross operating margin (3)   1,461.7         1,379.4         3,036.4         2,852.7  
Net adjustment for shipper make-up rights (4)   16.4         (1.5 )       27.9         (5.7 )
Non-GAAP total gross operating margin (5) $ 1,478.1       $ 1,377.9       $ 3,064.3       $ 2,847.0  
 
Capital spending:
Capital expenditures $ 974.6 $ 682.7 $ 1,921.1 $ 1,113.1
Cash used for business combinations, net of cash received (0.1 ) 175.4 149.7 191.4
Investments in unconsolidated affiliates 8.0 10.4 45.9 24.1
Other investing activities   0.5         --         1.4         --  
Total capital spending, cash and non-cash $ 983.0       $ 868.5       $ 2,118.1       $ 1,328.6  
(1)   See Exhibit D for reconciliation to GAAP net cash flow provided by
operating activities.
(2) See Exhibit E for reconciliation to GAAP net cash flow provided by
operating activities.
(3) Within the context of this table, total segment gross operating
margin represents a subtotal and corresponds to measures similarly
titled within the financial statement footnotes provided in our
quarterly and annual filings with the U.S. Securities and Exchange
Commission ("SEC").
(4) Gross operating margin by segment for NGL Pipelines & Services and
Crude Oil Pipelines & Services reflects adjustments for
non-refundable deferred transportation revenues relating to the
make-up rights of committed shippers on certain major pipeline
projects. These adjustments are included in managements' evaluation
of segment results. However, these adjustments are excluded from
non-GAAP total gross operating margin in compliance with guidance
from the SEC.
(5) See Exhibit F for reconciliation to GAAP total operating income.
       
Enterprise Products Partners L.P. Exhibit B
Selected Operating Data – UNAUDITED            
 
For the Three Months

Ended June 30,

    For the Six Months

Ended June 30,

2018     2017     2018     2017

Selected operating data: (1)

       
NGL Pipelines & Services, net:
NGL pipeline transportation volumes (MBPD) 3,408 3,083 3,347 3,160
NGL marine terminal volumes (MBPD) 597 474 586 521
NGL fractionation volumes (MBPD) 927 841 907 820
Equity NGL production (MBPD) (2) 164 164 164 157
Fee-based natural gas processing (MMcf/d) (3) 4,624 4,660 4,554 4,598
Crude Oil Pipelines & Services, net:
Crude oil pipeline transportation volumes (MBPD) 2,050 1,475 2,041 1,416
Crude oil marine terminal volumes (MBPD) 802 488 718 482
Natural Gas Pipelines & Services, net:
Natural gas pipeline transportation volumes (BBtus/d) (4) 13,654 12,232 13,343 11,934
Petrochemical & Refined Products Services, net:
Propylene production volumes (MBPD) 100 81 98 81
Butane isomerization volumes (MBPD) 116 116 115 104
Standalone DIB processing volumes (MBPD) 89 81 83 82
Octane additive and related plant production volumes (MBPD) 30 30 28 25
Pipeline transportation volumes, primarily refined products
and petrochemicals (MBPD) 771 800 810 813
Refined products and petrochemicals marine terminal volumes
(MBPD) 350 471 359 435
Total, net:
NGL, crude oil, petrochemical and refined products
pipeline transportation volumes (MBPD) 6,229 5,358 6,198 5,389
Natural gas pipeline transportation volumes (BBtus/d) 13,654 12,232 13,343 11,934
Equivalent pipeline transportation volumes (MBPD) (5) 9,822 8,577 9,709 8,530
NGL, crude oil, refined products and petrochemical
marine terminal volumes (MBPD) 1,749 1,433 1,663 1,438
                         
 
(1)   Operating rates are reported on a net basis, which takes into
account our ownership interests in certain joint ventures, and
include volumes for newly constructed assets from the related
in-service dates and for recently purchased assets from the related
acquisition dates.
(2) Represents the NGL volumes we earn and take title to in connection
with our processing activities.
(3) Volumes reported correspond to the revenue streams earned by our gas
plants. "MMcf/d" means million cubic feet per day.
(4) "BBtus/d" means billion British thermal units per day.
(5) Represents total NGL, crude oil, refined products and petrochemical
transportation volumes plus equivalent energy volumes where 3.8
million British thermal units ("MMBtus") of natural gas
transportation volumes are equivalent to one barrel of NGLs
transported.
 

Enterprise Products Partners L.P.

Exhibit C

Selected Commodity Price Information  
 

The following table presents selected average index prices for
natural gas and selected NGL and petrochemical products for the
periods indicated:

                               
Polymer Refinery
Natural Normal Natural Grade Grade
Gas, Ethane, Propane, Butane, Isobutane, Gasoline, Propylene, Propylene,
$/MMBtu     $/gallon     $/gallon     $/gallon     $/gallon     $/gallon     $/pound     $/pound
(1) (2) (2) (2) (2) (2) (3) (3)
2017 by quarter:
1st Quarter $3.32 $0.23 $0.71 $0.98 $0.94 $1.10 $0.47 $0.32
2nd Quarter $3.19 $0.25 $0.63 $0.76 $0.75 $1.07 $0.41 $0.28
3rd Quarter $2.99 $0.26 $0.77 $0.91 $0.92 $1.10 $0.42 $0.28
4th Quarter $2.93     $0.25     $0.96     $1.04     $1.04     $1.32     $0.49     $0.35
2017 Averages $3.11     $0.25     $0.77     $0.92     $0.91     $1.15     $0.45     $0.31
 
2018 by quarter:
1st Quarter $3.01 $0.25 $0.85 $0.96 $1.00 $1.41 $0.53 $0.33
2nd Quarter $2.80     $0.29     $0.87     $1.00     $1.20     $1.53     $0.52     $0.37
2018 Averages $2.91     $0.27     $0.86     $0.98     $1.10     $1.47     $0.53     $0.35
                                                 

 

(1)   Natural gas prices are based on Henry-Hub Inside FERC commercial
index prices as reported by Platts, which is a division of McGraw
Hill Financial, Inc.
(2) NGL prices for ethane, propane, normal butane, isobutane and natural
gasoline are based on Mont Belvieu Non-TET commercial index prices
as reported by Oil Price Information Service.
(3) Polymer grade propylene prices represent average contract pricing
for such product as reported by IHS Chemical, a division of IHS Inc.
("IHS Chemical"). Refinery grade propylene prices represent
weighted-average spot prices for such product as reported by IHS
Chemical.
 

The following table presents selected average index prices for
crude oil for the periods indicated:

               

 

WTI Midland Houston LLS
Crude Oil, Crude Oil, Crude Oil Crude Oil,
$/barrel     $/barrel     $/barrel     $/barrel
(1) (2) (2) (3)
2017 by quarter:
1st Quarter $51.91 $51.72 $53.27 $53.52
2nd Quarter $48.28 $47.29 $49.77 $50.31
3rd Quarter $48.20 $47.37 $50.84 $51.62
4th Quarter $55.40     $55.47     $59.84     $61.07
2017 Averages $50.95     $50.44     $53.41     $54.13
 
2018 by quarter:
1st Quarter $62.87 $62.51 $65.47 $65.79
2nd Quarter $67.88     $59.93     $72.38     $72.97
2018 Averages $65.38     $61.22     $68.93     $69.38
                         
 
(1)   WTI prices are based on commercial index prices at Cushing, Oklahoma
as measured by the New York Mercantile Exchange.
(2) Midland and Houston crude oil prices are based on commercial index
prices as reported by Argus.
(3) Light Louisiana Sweet ("LLS") prices are based on commercial index
prices as reported by Platts.

The weighted-average indicative market price for NGLs (based on prices
for such products at Mont Belvieu, Texas, which is the primary industry
hub for domestic NGL production) was $0.83 per gallon during the second
quarter of 2018 versus $0.60 per gallon for the second quarter of 2017.
Fluctuations in our consolidated revenues and cost of sales amounts are
explained in large part by changes in energy commodity prices. Energy
commodity prices fluctuate for a variety of reasons, including supply
and demand imbalances and geopolitical tensions. A change in our
consolidated marketing revenues due to higher energy commodity sales
prices may not result in a similar change in gross operating margin or
cash available for distribution, since our consolidated cost of sales
amounts would also change due to comparable increases in the purchase
prices of the underlying energy commodities.

 

Enterprise Products Partners L.P.

    Exhibit D
Distributable Cash Flow – UNAUDITED      
($ in millions)        
For the Three Months

Ended June 30,

    For the Six Months

Ended June 30,

2018     2017     2018     2017
Net income attributable to limited partners (GAAP) $ 673.8     $ 653.7 $ 1,574.5     $ 1,414.4

Adjustments to GAAP net income attributable to limited partners
to derive non-

  GAAP distributable cash flow:

Add depreciation, amortization and accretion expenses 458.3 406.5 889.3 808.8
Add distributions received from unconsolidated affiliates 131.1 127.4 253.5 229.9
Subtract equity in income of unconsolidated affiliates (122.3 ) (107.0 ) (238.0 ) (201.8 )
Subtract sustaining capital expenditures (1) (72.8 ) (62.3 ) (139.1 ) (110.3 )
Add net losses or subtract net gains attributable to asset sales (0.9 ) 0.3 (1.4 ) --
Add cash proceeds from asset sales 1.5 1.2 2.6 3.2
Subtract gain on the acquisition of equity method investment (2.4 ) -- (39.4 ) --

Add non-cash expense attributable to changes in fair

  value of the Liquidity Option Agreement

8.9 18.6 16.4 24.1

Add non-cash expense or subtract benefit attributable to changes in

  fair value of derivative instruments

322.1 (23.6 ) 459.0 (43.9 )
Add deferred income tax expense 11.1 0.6 10.0 0.7
Add non-cash asset impairment and related charges 15.9 14.0 16.8 25.2

Add other miscellaneous adjustments to derive non-GAAP

  distributable cash flow, as applicable

  6.5         22.5         17.2         30.2  
Distributable cash flow (non-GAAP) 1,430.8 1,051.9 2,821.4 2,180.5

Adjustments to non-GAAP distributable cash flow to derive GAAP
net cash flow

  provided by operating activities:

Add sustaining capital expenditures reflected in distributable cash
flow
72.8 62.3 139.1 110.3
Subtract cash proceeds from asset sales reflected in distributable
cash flow
(1.5 ) (1.2 ) (2.6 ) (3.2 )
Add or subtract the net effect of changes in operating accounts, as
applicable
(25.4 ) 370.9 (228.5 ) 82.1

Subtract miscellaneous non-cash and other amounts to reconcile
non-GAAP

  distributable cash flow with GAAP net cash flow provided by
operating

  activities, as applicable

  (12.5 )       (24.6 )       (31.6 )       (34.8 )
Net cash flow provided by operating activities (GAAP) $ 1,464.2       $ 1,459.3       $ 2,697.8       $ 2,334.9  
 
(1)     Sustaining capital expenditures are capital expenditures (as defined
by GAAP) resulting from improvements to and major renewals of
existing assets. Such expenditures serve to maintain existing
operations but do not generate additional revenues.
 

Distributable cash flow

Our management compares the distributable cash flow we generate to the
cash distributions we expect to pay our partners. Using this metric,
management computes our distribution coverage ratio. Distributable cash
flow is an important non-GAAP liquidity measure for our limited partners
since it serves as an indicator of our success in providing a cash
return on investment. Specifically, this liquidity measure indicates to
investors whether or not we are generating cash flows at a level that
can sustain or support an increase in our quarterly cash distributions.
Distributable cash flow is also a quantitative standard used by the
investment community with respect to publicly traded partnerships
because the value of a partnership unit is, in part, measured by its
yield, which is based on the amount of cash distributions a partnership
can pay to a unitholder. The GAAP measure most directly comparable to
distributable cash flow is net cash flow provided by operating
activities.

   

Enterprise Products Partners L.P.

Exhibit E
Adjusted EBITDA – UNAUDITED
($ in millions)
           

For the Twelve

Months Ended

June 30,

For the Three Months

Ended June 30,

    For the Six Months

Ended June 30,

2018     2017     2018     2017     2018
Net income (GAAP) $ 687.2     $ 666.0 $ 1,598.7     $ 1,437.0 $ 3,017.3
Adjustments to GAAP net income to derive non-GAAP Adjusted EBITDA:
Subtract equity in income of unconsolidated affiliates (122.3 ) (107.0 ) (238.0 ) (201.8 ) (462.2 )
Add distributions received from unconsolidated affiliates 131.1 127.4 253.5 229.9 506.6
Add interest expense, including related amortization 274.6 245.8 526.7 495.1 1,016.2
Add provision for income taxes 18.4 8.7 23.5 14.7 34.5
Add depreciation, amortization and accretion in costs and expenses 434.8 387.8 838.3 772.1 1,632.1
Add non-cash asset impairment and related charges 15.9 14.0 16.8 25.2 41.4
Add non-cash net losses or subtract net gains attributable to asset
sales
(0.9 ) 0.3 (1.4 ) -- (12.1 )
Subtract gain on the acquisition of equity method investment (2.4 ) -- (39.4 ) -- (39.4 )

Add non-cash expense attributable to changes in fair

  value of the Liquidity Option Agreement

8.9 18.6 16.4 24.1 56.6

Add losses or subtract gains attributable to unrealized changes

  in the fair market value of commodity derivative instruments

  322.0         (23.4 )       458.8         (43.7 )       525.6  
Adjusted EBITDA (non-GAAP) 1,767.3 1,338.2 3,453.9 2,752.6 6,316.6

Adjustments to non-GAAP Adjusted EBITDA to derive GAAP net cash
flow

  provided by operating activities:

Subtract interest expense, including related amortization,
reflected in

  Adjusted EBITDA

(274.6 ) (245.8 ) (526.7 ) (495.1 ) (1,016.2 )

Subtract provision for income taxes reflected in

  Adjusted EBITDA

(18.4 ) (8.7 ) (23.5 ) (14.7 ) (34.5 )

Subtract distributions received for return of capital from

  unconsolidated affiliates

(11.0 ) (12.8 ) (25.9 ) (24.8 ) (50.4 )
Add deferred income tax expense 11.1 0.6 10.0 0.7 15.4

Add or subtract the net effect of changes in operating accounts, as

  applicable

(25.4 ) 370.9 (228.5 ) 82.1 (278.4 )

Add miscellaneous non-cash and other amounts to reconcile non-GAAP

  Adjusted EBITDA with GAAP net cash flow provided by operating

  activities

  15.2         16.9         38.5         34.1         76.7  
Net cash flow provided by operating activities (GAAP) $ 1,464.2       $ 1,459.3       $ 2,697.8       $ 2,334.9       $ 5,029.2  
 

Adjusted EBITDA

Adjusted EBITDA is commonly used as a supplemental financial measure by
our management and external users of our financial statements, such as
investors, commercial banks, research analysts and rating agencies, to
assess the financial performance of our assets without regard to
financing methods, capital structures or historical cost basis; the
ability of our assets to generate cash sufficient to pay interest and
support our indebtedness; and the viability of projects and the overall
rates of return on alternative investment opportunities.

Since Adjusted EBITDA excludes some, but not all, items that affect net
income or loss and because these measures may vary among other
companies, the Adjusted EBITDA data presented in this press release may
not be comparable to similarly titled measures of other companies. The
GAAP measure most directly comparable to Adjusted EBITDA is net cash
flow provided by operating activities.

 

Enterprise Products Partners L.P.

            Exhibit F
Total Gross Operating Margin – UNAUDITED                
($ in millions)
For the Three Months

Ended June 30,

    For the Six Months

Ended June 30,

2018     2017     2018     2017
Total gross operating margin (non-GAAP) $ 1,478.1     $ 1,377.9 $ 3,064.3     $ 2,847.0

Adjustments to reconcile non-GAAP total gross operating margin
to

  GAAP total operating income:

Subtract depreciation, amortization and accretion expense

  amounts not reflected in gross operating margin

(425.3 ) (379.2 ) (819.6 ) (755.4 )

Subtract non-cash asset impairment charges not reflected in

  gross operating margin

(15.9 ) (14.0 ) (16.8 ) (25.2 )

Subtract net losses or add net gains attributable to asset sales

  not reflected in gross operating margin

0.9 (0.3 ) 1.4 --

Subtract general and administrative costs not reflected in

  gross operating margin

  (51.4 )       (45.7 )       (104.4 )       (96.1 )
Total operating income (GAAP) $ 986.4       $ 938.7       $ 2,124.9       $ 1,970.3  
 

Total gross operating margin

We evaluate segment performance based on our financial measure of gross
operating margin. Gross operating margin is an important performance
measure of the core profitability of our operations and forms the basis
of our internal financial reporting. We believe that investors benefit
from having access to the same financial measures that our management
uses in evaluating segment results.

The term "total gross operating margin" represents GAAP operating income
exclusive of (i) depreciation, amortization and accretion expenses, (ii)
impairment charges, (iii) gains and losses attributable to asset sales,
and (iv) general and administrative costs. Total gross operating margin
includes equity in the earnings of unconsolidated affiliates, but is
exclusive of other income and expense transactions, income taxes, the
cumulative effect of changes in accounting principles and extraordinary
charges. Total gross operating margin is presented on a 100 percent
basis before any allocation of earnings to noncontrolling interests. The
GAAP financial measure most directly comparable to total gross operating
margin is operating income.

Total gross operating margin excludes amounts attributable to shipper
make-up rights as described in footnote (4) to Exhibit A of this press
release.

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