Energy Transfer LP's (ET) Q2 2022 Earnings Call Transcript

For the period ending June 30, 2022

August 3, 2022 4:30 p.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Welcome to the Energy Transfer Q2 2022 Earnings Conference Call. My name is Darryl, and I will be your operator for today's call. [Operator Instructions] As a reminder, this conference is being recorded.

I will now turn the call over to Tom Long, Energy Transfer's Co-CEO. Mr. Long, you may begin.

Tom Long

Thank you, operator. Good afternoon, everyone, and welcome to the Energy Transfer second quarter 2022 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 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 quarterly report on Form 10-Q for the quarter ended June 30, 2022, which we expect to be filed tomorrow, August 4.

I'll also refer to adjusted EBITDA and distributable cash flow, or DCF, both of which are non-GAAP financial measures. You will find a reconciliation of our non-GAAP measures on our website.

I'd like to start today by looking at some of our second quarter highlights. We were pleased to report another strong quarter, during which we generated adjusted EBITDA of $3.23 billion and DCF attributable to the partners of Energy Transfer, as adjusted, was $1.88 billion. This resulted in excess cash flow after distributions of approximately $1.17 billion.

On an incurred basis, we had excess DCF of approximately $730 million after distributions of $710 million and growth capital of approximately $440 million. On July 26, we announced a quarterly distribution of $0.23 per common unit or $0.92 on an annualized basis, which represents a more than 50% increase over the second quarter of 2021.

As a reminder, future increases to distribution level will be evaluated quarterly with the ultimate goal of returning distributions to the previous level of $0.305 per quarter or $1.22 on an annualized basis while balancing our leverage target, growth opportunities and unit buybacks.

Operationally, our diverse asset base saw throughput increases across all of our segments as rig counts continue to improve across the U.S., and we saw record midstream volumes as well record throughput on our NGL transportation pipelines, Mont Belvieu fractionators and terminals. In addition, construction continues to progress on several of our growth projects, which I will provide more details on shortly.