Energy Transfer LP Q1 FY2023 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Overview

  • Adjusted EBITDA was $3.43 billion, up from $3.34 billion in Q1 2022, driven by record volumes in interstate, midstream, NGL pipelines, and terminal exports.
  • Distributable Cash Flow (DCF) was $2.01 billion, down slightly from $2.08 billion in Q1 2022.
  • Excess cash flow after distributions was $1.04 billion. On an incurred basis, excess DCF was $640 million after distributions and CapEx.
  • Liquidity under revolving credit facility totaled $3.01 billion as of March 31, 2023.

Distribution Update

  • Quarterly cash distribution increased to $0.3075 per unit (annualized $1.23), up from $0.3050 in Q4 2022.
  • Management now targets ongoing quarterly increases of $0.0025 and an annual distribution growth rate of 3% to 5%.
  • Leverage expected to remain at the low end of the 4x to 4.5x target range.

Segment Performance

NGL and Refined Products
  • Adjusted EBITDA: $939 million, up significantly from $700 million in Q1 2022.
  • Drivers: higher margins across transportation, storage, and terminal services; hedged inventory gains (~$50 million).
  • NGL transportation volumes rose 13% to 2 million barrels per day.
  • Fractionation volumes rose 18% to 949,000 barrels per day.
  • NGL export volumes grew more than 20% YoY, with record ethane and LPG exports.

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Operator: Hello, and welcome to the Energy Transfer Q1 2023 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note today's event is being recorded. And now, I'd like to turn the conference over to your host today, Tom Long. Sir, please go ahead. Tom Long: Thank you, operator. Good afternoon, everyone, and welcome to the Energy Transfer first quarter 2023 earnings call. I'm also joined today by Mackie McCrea and other members of the senior management team who are here to help answer your questions after our prepared remarks. Hopefully, you saw the press release we issued earlier this afternoon as well as the slides posted to our website. As a reminder, we will be making forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. These statements are based upon our current beliefs as well as certain assumptions and information currently available to us and are discussed in more detail in our Form 10-Q for the quarter ended March 31, 2023, which we expect to file this Thursday, May 4. I'll also refer to adjusted EBITDA and distributable cash flow or DCF, both of which are non-GAAP financial measures. You'll find a reconciliation of our non-GAAP measures on our website. I'd like to start today by going over our financial results. We were pleased with our results for the first quarter of 202

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