HOUSTON, Nov. 1, 2018 /PRNewswire/ - Enbridge Energy
Partners, L.P. (NYSE: EEP) (EEP or the Partnership) today reported
third quarter 2018 financial results and provided a quarterly
business update. EEP reported net income of $207 million, of which $104 million is attributable to EEP's controlling
interests, for the third quarter ended September 30, 2018,
with net income per unit of $0.21.
The third quarter results included net non-recurring special items
of $9 million, which increased net
income per unit by $0.02.
THIRD QUARTER HIGHLIGHTS:
- Definitive agreement with Enbridge, the indirect parent of
EEP's General Partner (GP), announced on September 18, 2018, under which Enbridge will
acquire all of the outstanding EEP public Class A common units; EEP
public unitholders will receive 0.3350 common shares of Enbridge
for each Class A common unit of EEP
- Announced quarterly distribution of $0.35 per unit, or $1.40 on an annualized basis, for the quarter
ended September 30, 2018
FINANCIAL RESULTS
Third quarter 2018 cash provided by operating activities was
$322 million, compared with cash
provided by operating activities of $344
million in the third quarter 2017. Distributable cash flow
(DCF) was $184 million, compared with
$194 million in the prior year
quarter. EEP's coverage ratio was 1.12x as declared in the third
quarter 2018 and 1.20x as declared in the third quarter 2017.
For the quarter, adjusted earnings before interest, taxes,
depreciation and amortization (EBITDA) were $403 million, compared with $426 million in the prior year quarter. Adjusted
net income was $95 million for the
quarter, or $0.19 adjusted net income
per unit, compared with $109 million,
or $0.24 adjusted net income per unit
in the prior year quarter. Net income was $104 million for the quarter, or $0.21 net income per unit, compared with
$93 million, or $0.19 net income per unit in the prior year
quarter.
PROPOSED MERGER
On September 18, 2018, EEP
announced that it had entered into a definitive agreement
(Agreement) with respect to the Proposed Merger, pursuant to which
an indirect wholly-owned subsidiary of Enbridge will be merged with
and into EEP, with EEP surviving as an indirect wholly-owned
subsidiary of Enbridge. Under the terms of the Agreement, Enbridge
will acquire all of the outstanding public Class A common units of
EEP in an all stock-for-unit transaction at an exchange ratio of
0.3350 common shares of Enbridge for each Class A common unit of
EEP. The Proposed Merger is part of Enbridge's sponsored vehicle
restructuring initiative to simplify its corporate structure.
Pursuant to the EEP Agreement, the affirmative vote of (i) at
least two-thirds of the outstanding limited partner units of EEP
entitled to vote on such matter, and (ii) a majority of the
outstanding Class A common units of EEP (other than Class A common
units held by Enbridge and its affiliates) and the outstanding
i-units of EEP held by Enbridge Energy Management, L.L.C. (NYSE:
EEQ) (EEQ) (other than i-units voted at the direction of Enbridge
and its affiliates), voting as a single class, is required to close
the EEP merger transaction. A record date of November 5, 2018 has been established for
determining the unitholders of EEP entitled to vote on the EEP
merger transaction at a special meeting which is expected to take
place on December 17, 2018.
Completion of the proposed EEP merger transaction is subject to
securing the EEP unitholder approvals referenced above and certain
other customary closing conditions and is targeted to occur late in
the fourth quarter of 2018.
Also announced on September 18,
2018, is the definitive agreement related to the EEQ buy-in
whereby EEQ public shareholders will receive 0.3350 common shares
of Enbridge for each Listed Share of EEQ. The closing of the
proposed EEP buy-in transaction is a condition to close the EEQ
buy-in, also targeted to occur late in the fourth quarter of 2018.
A record date of November 5, 2018 has
been established for determining the shareholders of EEQ entitled
to vote on the EEQ merger transaction at a special meeting which is
expected to take place on December 17,
2018.
SEGMENT RESULTS
For purposes of evaluating performance of the Partnership, the
Partnership makes adjustments for unusual, non-recurring or
non-operating factors to reported earnings, segment EBITDA, and
cash flow provided by operating activities, as it allows Management
and its investors to more accurately compare the Partnership's
performance across periods and the factors being adjusted for are
not indicative of the underlying performance and cash flows of the
business. Schedules reconciling adjusted EBITDA, adjusted EBITDA by
segment, adjusted net income, adjusted net income per unit and
distributable cash flow to their closest generally accepted
accounting principles in the United
States of America (GAAP) equivalent are available as
Appendices to this news release.
Liquids
Third quarter adjusted EBITDA decreased by $26 million over the comparable period in 2017
primarily due to lower Lakehead System EBITDA driven by the
regulatory impact of the U.S. Tax Reform and the FERC income tax
policy to no longer permit recovery of an income tax allowance in
cost of service rates. This was partially offset by lower operating
expenses due to timing and higher oil measurement gains on the
Lakehead System and higher earnings on the Bakken Pipeline System
due to higher volumes.
Third quarter adjusted EBITDA excludes certain special items
which are further described in Appendix E below.
Other
Other represents unallocated corporate costs of $1 million, in line with the prior year
quarter.
CONFERENCE CALL DETAILS
The Partnership will host a joint conference call and webcast at
9:00 a.m. Eastern Time (8:00 a.m. Central Time) on November 2, 2018, with Enbridge Inc. (TSX: ENB)
(NYSE: ENB), Enbridge Income Fund Holdings Inc. (TSX: ENF), and
Spectra Energy Partners, LP (NYSE: SEP) to provide an enterprise
wide business update and review 2018 third quarter results.
Analysts, members of the media and other interested parties can
access the call toll free at (877) 930-8043 or outside North America at (253) 336-7522 using the
access code of 6465399#. The call will be audio webcast live at
https://edge.media-server.com/m6/p/tsy478oc. A webcast replay and
podcast will be available approximately two hours after the
conclusion of the event and a transcript will be posted to the
website within approximately 24 hours. An audio replay will be
available for seven days after the call toll free at (855) 859-2056
or outside North America at (404)
537-3406 using the replay passcode 6465399#.
The conference call format will include prepared remarks from
the executive team followed by a question and answer session for
the analyst and investor community only. Enbridge's media and
investor relations teams will be available after the call for any
additional questions.
FORWARD-LOOKING STATEMENTS
This news release includes forward-looking statements, within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934, including with
respect to the transactions contemplated by the Agreement and Plan
of Merger, dated September 17, 2018,
by and among Enbridge Energy Partners, L.P., Enbridge Energy
Company, Inc., Enbridge Energy Management, L.L.C., Enbridge Inc.,
Enbridge (U.S.) Inc., Winter Acquisition Sub II, LLC, and, solely
for the purposes of Articles I, II and XI, Enbridge US Holdings
Inc. (the Proposed Merger). All statements other than statements of
historical fact contained in this news release on Form 8-K are
forward-looking statements, including, without limitation,
statements regarding the consummation of the Proposed Merger,
including the timing and expected effects thereof, which are
statements that frequently use words such as "anticipate,"
"believe," "consider," "continue," "could," "estimate," "evaluate,"
"expect," "explore," "forecast," "intend," "may," "opportunity,"
"plan," "position," "projection," "should," "strategy," "target,"
"will" and similar words. Although the Partnership believes that
such forward-looking statements are reasonable based on currently
available information, such statements involve risks, uncertainties
and assumptions and are not guarantees of performance. Future
actions, conditions or events and future results of operations may
differ materially from those expressed in these forward-looking
statements. Any forward-looking statement made by the Partnership
in this release speaks only as of the date on which it is made, and
the Partnership undertakes no obligation to publicly update any
forward-looking statement. Many of the factors that will determine
these results are beyond the Partnership's ability to control or
predict. Specific factors that could cause actual results to differ
from those in the forward-looking statements include: (1) the risk
that Enbridge may be unable to obtain governmental,
unitholder/shareholder and regulatory approvals required for the
Proposed Merger, whereby Enbridge will acquire all of the
Partnership's outstanding public Class A common units or required
governmental, unitholder/shareholder and regulatory approvals may
delay the Proposed Merger or result in the imposition of conditions
that could cause the parties to abandon the Proposed Merger; (2)
the risk that a condition to closing of the Proposed Merger may not
be satisfied; (3) the timing to complete the Proposed Merger; (4)
The Partnership's ability to realize expected cost savings,
benefits and any other synergies from the Proposed Merger and the
proposed simplification of Enbridge's overall corporate structure
may not be fully realized or may take longer to realize than
expected; (5) disruption from the Proposed Merger may make it more
difficult to maintain relationships with customers, employees or
suppliers; (6) the impact and outcome of pending and future
litigation, including litigation, if any, relating to the Proposed
Merger; (7) the effectiveness of the various actions the
Partnership has taken resulting from the Partnership's strategic
review process; (8) changes in the demand for, the supply of,
forecast data for, and price trends related to crude oil and liquid
petroleum, including the rate of development of the Alberta Oil
Sands; (9) The Partnership's ability to successfully complete and
finance expansion projects; (10) the effects of competition, in
particular, by other pipeline systems; (11) shut-downs or cutbacks
at the Partnership's facilities or refineries, petrochemical
plants, utilities or other businesses for which the Partnership
transports products or to whom the Partnership sell products; (12)
hazards and operating risks that may not be covered fully by
insurance; (13) any fines, penalties and injunctive relief assessed
in connection with any crude oil release; (14) state or federal
legislative and regulatory initiatives or actions that affect cost
and investment recovery or that have an effect on rate structure,
or other changes in or challenges to the Partnership's tariff
rates; (15) changes in laws or regulations to which the Partnership
is subject, including compliance with environmental and operational
safety regulations that may increase costs of system integrity
testing and maintenance; and (16) permitting at federal, state and
local levels or renewals of rights of way. Forward-looking
statements regarding sponsor support transactions or sales of
assets (to Enbridge or otherwise) are further qualified by the fact
that Enbridge is under no obligation to provide additional sponsor
support and neither Enbridge nor any third party is under any
obligation to offer to buy or sell us assets, and we are under no
obligation to buy or sell any such assets. As a result, we do not
know when or if any such transactions will occur. Any statements
regarding sponsor expectations or intentions are based on
information communicated to the Partnership by Enbridge Inc., but
there can be no assurance that these expectations or intentions
will not change in the future.
Except to the extent required by law, the Partnership assumes
no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise. Reference should also be made to the Partnership's
filings with the U.S. Securities and Exchange Commission (SEC),
including its most recently filed 2017 Annual Report on Form 10-K
dated February 16, 2018 and any
subsequently filed Quarterly Reports on Form 10-Q or current
reports on Form 8-K for additional factors that may affect results.
These filings are available to the public over the Internet at the
SEC's website (www.sec.gov) and at the Partnership's
website.
ABOUT ENBRIDGE ENERGY PARTNERS, L.P.
Enbridge Energy Partners, L.P. owns and operates a
diversified portfolio of crude oil transportation systems in
the United States. Its principal
crude oil system is the largest pipeline transporter of growing oil
production from western Canada and
the North Dakota Bakken formation. The system's deliveries to
refining centers and connected carriers in the United States account for approximately
25 percent of total U.S. oil imports. Enbridge Energy
Partners, L.P. is traded on the New York Stock Exchange under the
symbol EEP; information about the Partnership is available on its
website at www.enbridgepartners.com.
ABOUT ENBRIDGE ENERGY MANAGEMENT, L.L.C.
Enbridge Energy Management, L.L.C. manages the business and
affairs of the Partnership, and its sole asset is an approximate 21
percent limited partner interest in the Partnership. Enbridge
Energy Company, Inc., an indirect wholly owned subsidiary of
Enbridge Inc. of Calgary, Alberta,
Canada (NYSE: ENB) (TSX: ENB) is the General Partner of the
Partnership and holds an approximate 35 percent interest in the
Partnership. Enbridge Management is the delegate of the General
Partner of the Partnership.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media
|
Investment
Community
|
Michael
Barnes
|
Toll Free: (800)
481-2804
|
Toll Free: (888)
992-0997
|
Email:
investor.relations@enbridge.com
|
Email:
media@enbridge.com
|
|
NON-GAAP RECONCILIATIONS APPENDICES
Reconciliations of forward looking non-GAAP financial measures
to comparable GAAP measures are not available due to the challenges
with estimating some of the items, particularly with estimating
non-cash unrealized derivative fair value losses and gains, which
are subject to market variability and therefore a reconciliation is
not available without unreasonable effort.
Adjusted Net Income and Segment Adjusted EBITDA
Adjusted net income for the Partnership and adjusted EBITDA for
the principal business segment are provided to illustrate trends in
income excluding non-cash unrealized derivative fair value losses
and gains and other items that Management believes are not
indicative of the Partnership's core operating results. The
derivative non-cash losses and gains result from marking to market
certain financial derivatives used by the Partnership for hedging
purposes that do not qualify for hedge accounting treatment in
accordance with the authoritative accounting guidance as prescribed
under generally accepted accounting principles in the United States.
Adjusted EBITDA and Distributable Cash Flow
Adjusted EBITDA is used as a supplemental financial measurement
to manage the performance of the entity. Distributable cash flow is
used as a supplemental financial measurement to assess liquidity
and the ability to generate cash sufficient to pay interest costs
and make cash distributions to unitholders. The following
reconciliations of net income to adjusted EBITDA and net cash
provided by operating activities to distributable cash flow are
provided because adjusted EBITDA and distributable cash flow are
not financial measures recognized under generally accepted
accounting principles in the United
States.
APPENDIX A
FINANCIAL RESULTS
EEP reported financial results for the three and nine months
ended September 30, 2018, compared to the same period in 2017,
as summarized in the tables below:
|
Three months
ended
September 30,
|
|
Nine months ended
September 30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
(unaudited; in
millions, except per unit amounts)
|
|
|
|
|
|
|
|
|
|
|
|
Net
income(1)
|
$
|
104
|
|
$
|
93
|
|
$
|
273
|
|
$
|
251
|
Net income per unit
(basic and diluted)(1)
|
$
|
0.21
|
|
$
|
0.19
|
|
$
|
0.55
|
|
$
|
0.55
|
Operating Cash
Flow
|
$
|
322
|
|
$
|
344
|
|
$
|
938
|
|
$
|
388
|
Adjusted
EBITDA(2)
|
$
|
403
|
|
$
|
426
|
|
$
|
1,213
|
|
$
|
1,237
|
Distributable Cash
Flow
|
$
|
184
|
|
$
|
194
|
|
$
|
562
|
|
$
|
574
|
Distribution Coverage
Ratio (as declared)
|
|
1.12
|
|
|
1.20
|
|
|
1.14
|
|
|
1.19
|
Adjusted net
income(1)
|
$
|
95
|
|
$
|
109
|
|
$
|
291
|
|
$
|
243
|
Adjusted net income
per unit (basic and diluted)(1)
|
$
|
0.19
|
|
$
|
0.24
|
|
$
|
0.59
|
|
$
|
0.54
|
(1)
|
Net income and
adjusted net income attributable to general and limited partner
ownership interests in Enbridge Energy Partners, L.P.
|
(2)
|
Includes
noncontrolling interests.
|
|
Three months
ended
September 30,
|
|
Nine
months ended
September 30,
|
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
(unaudited; in
millions, except per unit amounts)
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
560
|
|
$
|
616
|
|
$
|
1,689
|
|
$
|
1,817
|
Operating
expenses:
|
|
|
|
|
|
|
|
Environmental costs,
net of recoveries
|
4
|
|
1
|
|
(18)
|
|
15
|
Operating and
administrative
|
126
|
|
162
|
|
393
|
|
474
|
Power
|
83
|
|
81
|
|
235
|
|
221
|
Depreciation and
amortization
|
111
|
|
112
|
|
330
|
|
329
|
Impairment of
long-lived asset
|
1
|
|
—
|
|
37
|
|
—
|
Gain on sale of
assets
|
(22)
|
|
(6)
|
|
(22)
|
|
(68)
|
Operating
income
|
257
|
|
266
|
|
734
|
|
846
|
Interest expense,
net
|
102
|
|
104
|
|
307
|
|
306
|
Allowance for equity
used during construction
|
16
|
|
12
|
|
48
|
|
33
|
Income from equity
investment in joint venture
|
37
|
|
22
|
|
93
|
|
28
|
Other income
(expense)
|
—
|
|
—
|
|
(1)
|
|
5
|
Income from
continuing operations before income taxes
|
208
|
|
196
|
|
567
|
|
606
|
Income tax benefit
(expense)
|
(1)
|
|
—
|
|
(1)
|
|
1
|
Income from
continuing operations
|
207
|
|
196
|
|
566
|
|
607
|
Loss from
discontinued operations, net of taxes
|
—
|
|
—
|
|
—
|
|
(57)
|
Net income
|
207
|
|
196
|
|
566
|
|
550
|
Noncontrolling
interests
|
(103)
|
|
(103)
|
|
(293)
|
|
(262)
|
Series 1 Preferred
unit distributions
|
—
|
|
—
|
|
—
|
|
(29)
|
Accretion of discount
on Series 1 Preferred units
|
—
|
|
—
|
|
—
|
|
(8)
|
Net income -
controlling interests
|
$
|
104
|
|
$
|
93
|
|
$
|
273
|
|
$
|
251
|
Net income allocable
to common units and i-units:
|
|
|
|
|
|
|
|
Income from
continuing operations
|
$
|
92
|
|
$
|
82
|
|
$
|
237
|
|
$
|
254
|
Loss from
discontinued operations
|
—
|
|
—
|
|
—
|
|
(38)
|
Net income allocable
to common units and i-units
|
$
|
92
|
|
$
|
82
|
|
$
|
237
|
|
$
|
216
|
Net income per common
unit and i-unit (basic and diluted):
|
|
|
|
|
|
|
|
Income from
continuing operations
|
$
|
0.21
|
|
$
|
0.19
|
|
$
|
0.55
|
|
$
|
0.65
|
Loss from
discontinued operations
|
—
|
|
—
|
|
—
|
|
(0.10)
|
Net income per common
unit and i-unit
|
$
|
0.21
|
|
$
|
0.19
|
|
$
|
0.55
|
|
$
|
0.55
|
Weighted average
common units and i-units (basic and diluted)
|
431
|
|
421
|
|
428
|
|
392
|
APPENDIX B
SEGMENT RESULTS
EEP reported segment results for the three and nine months ended
September 30, 2018, compared to the same period in 2017, as
summarized in the tables below:
|
Three months
ended
September 30,
|
|
Nine months ended
September 30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
(unaudited; in
millions)
|
|
|
|
|
|
|
|
Lakehead
|
$
|
319
|
|
$
|
349
|
|
$
|
971
|
|
$
|
1,036
|
Mid-Continent
|
13
|
|
12
|
|
42
|
|
41
|
Bakken
Assets
|
90
|
|
52
|
|
202
|
|
168
|
Total Liquids
EBITDA
|
$
|
422
|
|
$
|
413
|
|
$
|
1,215
|
|
$
|
1,245
|
Other
|
(3)
|
|
(2)
|
|
(12)
|
|
(18)
|
|
Three months
ended
September 30,
|
|
Nine months ended
September 30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
(unaudited; in
millions)
|
|
|
|
|
|
|
|
Lakehead
|
$
|
321
|
|
$
|
367
|
|
$
|
993
|
|
$
|
1,056
|
Mid-Continent
|
13
|
|
12
|
|
42
|
|
42
|
Bakken
Assets
|
68
|
|
49
|
|
183
|
|
120
|
Total Liquids
Adjusted EBITDA
|
$
|
402
|
|
$
|
428
|
|
$
|
1,218
|
|
$
|
1,218
|
Other(1)
|
1
|
|
(2)
|
|
(5)
|
|
19
|
Total Adjusted
EBITDA
|
$
|
403
|
|
$
|
426
|
|
$
|
1,213
|
|
$
|
1,237
|
(1)
|
Includes the adjusted
results of our disposed Natural Gas segment for the comparative
period.
|
|
Three months
ended
September 30,
|
|
Nine months ended
September 30,
|
Liquids Systems
Volumes
|
2018
|
|
2017
|
|
2018
|
|
2017
|
(average barrels
per day in thousands)
|
|
|
|
|
|
|
|
Lakehead
System:
|
|
|
|
|
|
|
|
United
States
|
2,073
|
|
1,982
|
|
2,109
|
|
2,008
|
Canada
|
654
|
|
638
|
|
647
|
|
649
|
Total Lakehead System
delivery volumes
|
2,727
|
|
2,620
|
|
2,756
|
|
2,657
|
Mid-Continent System
delivery volumes
|
—
|
|
—
|
|
—
|
|
33
|
Bakken
Assets:
|
|
|
|
|
|
|
|
North Dakota System to
Clearbrook
|
220
|
|
219
|
|
218
|
|
214
|
Bakken System to
Cromer(1)
|
58
|
|
84
|
|
56
|
|
116
|
Total Bakken Assets
delivery volumes
|
278
|
|
303
|
|
274
|
|
330
|
Total Liquids segment
delivery volumes
|
3,005
|
|
2,923
|
|
3,030
|
|
3,020
|
(1)
Lower spot volumes on the Bakken Pipeline, a component of the
Bakken Assets that delivers volumes into Cromer,
Manitoba.
|
APPENDIX C
NON-GAAP RECONCILATION EARNINGS TO
DISTRIBUTABLE CASH FLOW
|
Three months
ended
September 30,
|
|
Nine months ended
September 30,
|
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
(unaudited; in
millions)
|
|
|
|
|
|
|
|
EBITDA(1)
|
$
|
421
|
|
$
|
412
|
|
$
|
1,205
|
|
$
|
1,236
|
Depreciation and
amortization
|
(111)
|
|
(112)
|
|
(330)
|
|
(329)
|
Interest expense,
net
|
(102)
|
|
(104)
|
|
(307)
|
|
(306)
|
Net income
attributable to noncontrolling interests
|
(103)
|
|
(103)
|
|
(293)
|
|
(262)
|
Income tax benefit
(expense)
|
(1)
|
|
—
|
|
(1)
|
|
1
|
Other income
(expense)
|
—
|
|
—
|
|
(1)
|
|
5
|
Series 1 Preferred
unit distribution
|
—
|
|
—
|
|
—
|
|
(29)
|
Accretion of discount
on Series 1 Preferred units
|
—
|
|
—
|
|
—
|
|
(8)
|
Loss from
discontinued operations, net of tax
|
—
|
|
—
|
|
—
|
|
(57)
|
Net income -
controlling interests
|
$
|
104
|
|
$
|
93
|
|
$
|
273
|
|
$
|
251
|
Noncash derivative
fair value (gains) losses:
|
|
|
|
|
|
|
|
|
|
-Liquids
|
1
|
|
2
|
|
8
|
|
(1)
|
-Natural Gas
(included in Discontinued Operations)
|
—
|
|
—
|
|
—
|
|
(12)
|
-Other
|
—
|
|
—
|
|
—
|
|
2
|
Accretion of discount
on Series 1 preferred units
|
—
|
|
—
|
|
—
|
|
8
|
Leak remediation
costs, net of recoveries
|
—
|
|
—
|
|
(23)
|
|
—
|
Sandpiper Project
wind down costs
|
—
|
|
—
|
|
—
|
|
4
|
Gain on sale of
assets
|
(14)
|
|
(3)
|
|
(14)
|
|
(35)
|
Severance
costs
|
—
|
|
—
|
|
1
|
|
8
|
Impairment of
long-lived asset
|
1
|
|
—
|
|
37
|
|
—
|
Integration
costs
|
—
|
|
17
|
|
3
|
|
18
|
Legal
costs
|
1
|
|
—
|
|
4
|
|
—
|
Merger
costs
|
2
|
|
—
|
|
2
|
|
—
|
Adjusted net
income
|
$
|
95
|
|
$
|
109
|
|
$
|
291
|
|
$
|
243
|
Series 1 preferred
unit distributions
|
—
|
|
—
|
|
—
|
|
29
|
Net income
attributable to noncontrolling interests
|
94
|
|
101
|
|
284
|
|
239
|
Depreciation and
amortization
|
111
|
|
112
|
|
330
|
|
329
|
Interest expense,
net
|
102
|
|
104
|
|
307
|
|
306
|
Income tax expense
(benefit)
|
1
|
|
—
|
|
1
|
|
(1)
|
Interest expense,
income tax expense, and depreciation and amortization -
discontinued operations
|
—
|
|
—
|
|
—
|
|
92
|
Adjusted
EBITDA
|
$
|
403
|
|
$
|
426
|
|
$
|
1,213
|
|
$
|
1,237
|
Net income
attributable to noncontrolling interests
|
(105)
|
|
(116)
|
|
(316)
|
|
(307)
|
Interest expense,
net(2)(3)(4)
|
(94)
|
|
(97)
|
|
(283)
|
|
(301)
|
Income tax
expense
|
(1)
|
|
(1)
|
|
(1)
|
|
(1)
|
Distributions in
excess of equity earnings, net of NCI
|
4
|
|
3
|
|
14
|
|
3
|
Maintenance capital
expenditures
|
(8)
|
|
(10)
|
|
(19)
|
|
(26)
|
Allowance for equity
used during construction(5)
|
(16)
|
|
(12)
|
|
(48)
|
|
(33)
|
Other
|
1
|
|
1
|
|
2
|
|
2
|
DCF
|
$
|
184
|
|
$
|
194
|
|
$
|
562
|
|
$
|
574
|
(1)
|
The Partnership does
not have reportable segments under GAAP.
|
(2)
|
Excludes $7 million
and $7 million of amortization related to pre-issuance interest
swaps for the three months ended September 30, 2018 and 2017,
respectively. Excludes $20 million and $20 million of amortization
related to pre-issuance interest swaps for the nine months ended
September 30, 2018 and 2017.
|
(3)
|
Excludes $1 million
and $4 million of amortization related debt issuance costs for the
three and nine months ended September 30, 2018, respectively,
beginning Q1 2018.
|
(4)
|
Excludes $2 million
of unrealized mark-to-market net losses for the nine months ended
September 30, 2017.
|
(5)
|
Distributable cash
flow excludes allowance for equity used during construction
beginning Q1 2017.
|
APPENDIX D
NON-GAAP RECONCILIATION REPORTED TO
ADJUSTED NET INCOME PER COMMON UNIT AND I-UNIT
|
Three months
ended
September 30,
|
|
Nine months ended
September 30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
(unaudited)
|
|
|
|
|
|
|
|
Net income per unit
(basic and diluted)
|
$
|
0.21
|
|
$
|
0.19
|
|
$
|
0.55
|
|
$
|
0.55
|
Noncash derivative
fair value (gains) losses:
|
|
|
|
|
|
|
|
-Liquids
|
—
|
|
0.01
|
|
0.02
|
|
—
|
-Natural Gas
(included in Discontinued Operations)
|
—
|
|
—
|
|
—
|
|
(0.03)
|
-Other
|
—
|
|
—
|
|
—
|
|
0.01
|
Accretion of discount
on Series 1 preferred units
|
—
|
|
—
|
|
—
|
|
0.02
|
Leak remediation
costs, net of recoveries
|
—
|
|
—
|
|
(0.05)
|
|
—
|
Sandpiper Project
wind down costs
|
—
|
|
—
|
|
—
|
|
0.01
|
Gain on sale of
assets
|
(0.03)
|
|
(0.01)
|
|
(0.03)
|
|
(0.09)
|
Severance
costs
|
—
|
|
—
|
|
0.01
|
|
0.02
|
Impairment of
long-lived asset
|
—
|
|
—
|
|
0.06
|
|
—
|
Integration
costs
|
—
|
|
0.05
|
|
0.01
|
|
0.05
|
Legal
costs
|
—
|
|
—
|
|
0.01
|
|
—
|
Merger
costs
|
0.01
|
|
—
|
|
0.01
|
|
—
|
Adjusted net income
per unit (basic and diluted)
|
$
|
0.19
|
|
$
|
0.24
|
|
$
|
0.59
|
|
$
|
0.54
|
Weighted average
common units and i-units outstanding
|
431
|
|
421
|
|
428
|
|
392
|
APPENDIX E
NON-GAAP RECONCILIATION LIQUIDS REPORTED
EBITDA TO ADJUSTED EBITDA
|
Three months
ended
September 30,
|
|
Nine months ended
September 30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
(unaudited; in
millions)
|
|
|
|
|
|
|
|
|
EBITDA
|
$
|
422
|
|
$
|
413
|
|
$
|
1,215
|
|
$
|
1,245
|
Noncash derivative
fair value (gains) losses
|
1
|
|
2
|
|
8
|
|
(1)
|
Leak remediation
costs, net of recoveries
|
—
|
|
—
|
|
(23)
|
|
—
|
Gain on sale of
assets
|
(22)
|
|
(5)
|
|
(22)
|
|
(57)
|
Sandpiper Project
wind down costs
|
—
|
|
1
|
|
—
|
|
7
|
Severance
costs
|
—
|
|
—
|
|
—
|
|
6
|
Integration
costs
|
—
|
|
17
|
|
3
|
|
18
|
Impairment of
long-lived asset
|
1
|
|
—
|
|
37
|
|
—
|
Adjusted
EBITDA
|
$
|
402
|
|
$
|
428
|
|
$
|
1,218
|
|
$
|
1,218
|
APPENDIX F
NON-GAAP RECONCILIATION - OPERATING CASH
FLOW TO DISTRIBUTABE CASH FLOW
|
Three months
ended
September 30,
|
|
Nine months ended
September 30,
|
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
(unaudited; in
millions)
|
|
|
|
|
|
|
|
Total net cash
provided by (used in) operating activities
|
$
|
322
|
|
$
|
344
|
|
$
|
938
|
|
$
|
388
|
Changes in operating
assets and liabilities, net of cash acquired
|
(31)
|
|
(35)
|
|
(62)
|
|
512
|
Distributions in
excess of equity earnings, net of NCI
|
4
|
|
2
|
|
14
|
|
3
|
Maintenance capital
expenditures
|
(8)
|
|
(10)
|
|
(19)
|
|
(26)
|
Noncontrolling
interests
|
(105)
|
|
(116)
|
|
(316)
|
|
(307)
|
Gain on sale of
assets
|
—
|
|
—
|
|
—
|
|
11
|
Severance
costs
|
—
|
|
—
|
|
1
|
|
8
|
Integration
costs
|
—
|
|
—
|
|
3
|
|
1
|
Merger
costs
|
2
|
|
—
|
|
2
|
|
—
|
Legal
costs
|
1
|
|
—
|
|
4
|
|
—
|
Other
|
(1)
|
|
9
|
|
(3)
|
|
(16)
|
Distributable cash
flow
|
$
|
184
|
|
$
|
194
|
|
$
|
562
|
|
$
|
574
|
View original
content:http://www.prnewswire.com/news-releases/enbridge-energy-partners-lp-reports-third-quarter-2018-results-300742697.html
SOURCE Enbridge Energy Partners, L.P.