HOUSTON, TX, Jan. 22, 2019 /PRNewswire/ - Enbridge Inc. ("Enbridge") today announced that its wholly owned subsidiaries, Enbridge Energy Partners, L.P. ("EEP") and Spectra Energy Partners, LP ("SEP" and, together with EEP, the "Partnerships"), received the requisite consents with respect to, and have completed, the previously announced consent solicitations relating to the series of notes listed in the table below (collectively, the "Consenting EEP and SEP Notes"). Each Partnership expects to promptly enter into supplemental indentures to effect the proposed amendments described in the Consent Solicitation Statement dated January 8, 2019 (the "Statement") with respect to each series of the Consenting EEP and SEP Notes and, together with Enbridge, to enter into supplemental indentures to implement the unconditional guarantee of each series of Consenting EEP and SEP Notes by Enbridge as described in the Statement.
Consenting EEP and SEP Notes
ENBRIDGE ENERGY PARTNERS, L.P. | SPECTRA ENERGY PARTNERS, LP | |
9.875% Notes due 2019 (CUSIP No. 29250R AR7) | Floating Rate Senior Notes due 2020 (CUSIP No. 84756N AJ8) | |
5.200% Notes due 2020 (CUSIP No. 29250R AS5) | 4.600% Senior Notes due 2021 (CUSIP No. 84756N AB5) | |
4.375% Notes due 2020 (CUSIP No. 29250R AV8) | 4.750% Senior Notes due 2024 (CUSIP No. 84756N AD1) | |
4.200% Notes due 2021 (CUSIP No. 29250R AU0) | 3.500% Senior Notes due 2025 | |
5.875% Notes due 2025 | 3.375% Senior Notes due 2026 | |
5.950% Notes due 2033 | 5.950% Senior Notes due 2043 | |
6.300% Notes due 2034 | 4.500% Senior Notes due 2045 | |
7.500% Notes due 2038 | ||
5.500% Notes due 2040 | ||
7.375% Notes due 2045 |
The consent solicitations with respect to each series of Consenting EEP and SEP Notes expired at 5:00 p.m., New York City Time, on January 18, 2019 (the "Expiration Date"), and revocation rights with respect to consents validly delivered in respect of the Consenting EEP and SEP Notes have terminated. Subject to the terms and conditions set forth in the Statement, each Partnership will pay eligible holders of the Consenting EEP and SEP Notes who validly delivered and did not revoke consents on or prior to the Expiration Date a cash payment equal to $1.00 for each $1,000 aggregate principal amount of Consenting EEP and SEP Notes for which such holders validly delivered and did not revoke consents (the "Consent Fee"). Each Partnership will deliver its respective Consent Fee to Depository Trust Company ("DTC") on January 22, 2019, and they expect distribution of such fee by DTC to consenting holders to occur promptly afterward.
The supplemental indentures to be executed in connection with the completion of the consent solicitations will bind all holders of the Consenting EEP and SEP Notes, including those that did not give their consent, but holders who did not deliver consents prior to the Expiration Date (or delivered consents but properly revoked them) will not receive the Consent Fee.
Questions concerning the consent solicitations may be directed to the solicitation agents, J.P. Morgan Securities LLC at (866) 834-4666 (toll free) or (212) 834-3424 (collect) and MUFG Securities Americas Inc. (877) 744-4532 (toll free), (212) 405-7481 (collect) or (44) 207-577-4048/4218 (int'l), or D. F. King, by calling (212) 269-5550 (collect for banks and brokers) or (800) 398-1247 (toll free for all others).
In addition, each Partnership expects to promptly enter into a subsidiary guarantee agreement pursuant to which the Partnerships will jointly and severally guarantee the following series of notes (collectively, the "Subsidiary Guaranteed Enbridge Notes") issued by Enbridge:
Subsidiary Guaranteed Enbridge Notes
US DOLLAR DENOMINATED | CANADIAN DOLLAR DENOMINATED | |
Senior Floating Rate Notes due 2020 | 4.100% Senior Notes due 2019 | |
Senior Floating Rate Notes due 2020 | Senior Floating Rate Notes due 2019 | |
2.900% Senior Notes due 2022 | 4.770% Senior Notes due 2019 | |
4.000% Senior Notes due 2023 | 4.530% Senior Notes due 2020 | |
3.500% Senior Notes due 2024 | 4.850% Senior Notes due 2020 | |
4.250% Senior Notes due 2026 | 4.260% Senior Notes due 2021 | |
3.700% Senior Notes due 2027 | 3.160% Senior Notes due 2021 | |
4.500% Senior Notes due 2044 | 4.850% Senior Notes due 2022 | |
5.500% Senior Notes due 2046 | 3.190% Senior Notes due 2022 | |
3.940% Senior Notes due 2023 | ||
3.940% Senior Notes due 2023 | ||
3.950% Senior Notes due 2024 | ||
3.200% Senior Notes due 2027 | ||
6.100% Senior Notes due 2028 | ||
7.220% Senior Notes due 2030 | ||
7.200% Senior Notes due 2032 | ||
5.570% Senior Notes due 2035 | ||
5.750% Senior Notes due 2039 | ||
5.120% Senior Notes due 2040 | ||
4.240% Senior Notes due 2042 | ||
4.570% Senior Notes due 2044 | ||
4.870% Senior Notes due 2044 (CUSIP No. 29251Z BR7) | ||
4.560% Senior Notes due 2064 (CUSIP No. 29251Z BH9) |
This announcement is not an offer to purchase, a solicitation of an offer to purchase or a solicitation of consents with respect to any securities. The consent solicitations were made solely pursuant to the Statement and subject to the terms and conditions stated therein.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words "assumes," "believes," "estimates," "expects," "guidance," "intends," "plans," "projects," and similar expressions that do not relate to historical matters. All statements other than statements of historical fact are forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors which are, in some cases, beyond our control and could materially affect actual results, performance, or achievements. Important risk factors that may affect the consent solicitations and our business, results of operations and financial position are detailed in the Statement and in the reports we file with the U.S. Securities and Exchange Commission. Actual operating results may differ materially from what is expressed or forecast in this press release. We undertake no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as may be required by applicable law.
About Enbridge Inc.
Enbridge is North America's premier energy infrastructure company with strategic business platforms that include an extensive network of crude oil, liquids and natural gas pipelines, regulated natural gas distribution utilities and renewable power generation. The Company safely delivers an average of 2.9 million barrels of crude oil each day through its Mainline and Express Pipeline; accounts for approximately 62% of U.S.-bound Canadian crude oil exports; and moves approximately 22% of all natural gas consumed in the U.S., serving key supply basins and demand markets. The Company's regulated utilities serve approximately 3.7 million retail customers in Ontario, Quebec, and New Brunswick. Enbridge also has interests in more than 1,700 MW of net renewable generating capacity in North America and Europe. The Company has ranked on the Global 100 Most Sustainable Corporations index for the past nine years; its common shares trade on the Toronto and New York stock exchanges under the symbol ENB.
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. Information about EEP is available on its website at www.enbridgepartners.com.
About Spectra Energy Partners, LP
Spectra Energy Partners, LP connects growing supply areas to high-demand markets for natural gas and crude oil. Its assets include approximately 16,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Information about SEP is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media
Michael Barnes
Toll Free: (888) 992-0997
Email: media@enbridge.com
Investment Community
Jonathan Gould
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
SOURCE Enbridge Inc.
HOUSTON, Jan. 8, 2019 /PRNewswire/ - Enbridge Inc. ("Enbridge") today announced that its wholly owned subsidiaries, Enbridge Energy Partners, L.P. ("EEP") and Spectra Energy Partners, LP ("SEP" and, together with EEP, the "Partnerships"), have commenced consent solicitations (the "Consent Solicitations") to holders of the following series of notes (collectively, the "Notes") to amend (the "Amendments") the respective indentures governing the Notes:
ENBRIDGE ENERGY PARTNERS, L.P. (the "EEP Notes") | SPECTRA ENERGY PARTNERS, LP (the "SEP Notes") | |
9.875% Notes due 2019 (CUSIP No. 29250R AR7) | Floating Rate Senior Notes due 2020 (CUSIP No. 84756N AJ8), | |
5.200% Notes due 2020 (CUSIP No. 29250R AS5) | 4.600% Senior Notes due 2021 (CUSIP No. 84756N AB5), | |
4.375% Notes due 2020 (CUSIP No. 29250R AV8) | 4.750% Senior Notes due 2024 (CUSIP No. 84756N AD1), | |
4.200% Notes due 2021 (CUSIP No. 29250R AU0) | 3.500% Senior Notes due 2025 (CUSIP No. 84756N AF6), | |
5.875% Notes due 2025 (CUSIP No. 29250R AW6) | 3.375% Senior Notes due 2026 (CUSIP No. 84756N AH2), | |
5.950% Notes due 2033 (CUSIP No. 29250R AD8) | 5.950% Senior Notes due 2043 (CUSIP No. 84756N AE9) and | |
6.300% Notes due 2034 (CUSIP No. 29250R AG1) | 4.500% Senior Notes due 2045 (CUSIP No. 84756N AG4) | |
7.500% Notes due 2038 (CUSIP No. 29250R AP1) | ||
5.500% Notes due 2040 (CUSIP No. 29250R AT3) | ||
7.375% Notes due 2045 (CUSIP No. 29250R AX4) |
Each Partnership will make a cash payment of $1.00 for each $1,000 principal amount of a series of its Notes (such payments, collectively, the "Consent Fee") to each holder of record of that series of Notes who has delivered (and not revoked) a consent to the applicable Amendments at or prior to the Expiration Time (as defined below) if such Partnership receives valid consents from the holders of at least a majority in principal amount of that series of outstanding Notes (the "Requisite Consents") and the other conditions to the Consent Solicitations are satisfied or waived, including the condition that the Requisite Consents shall have been obtained with respect to each other series of Notes. If the Requisite Consents with respect to a series of Notes are not received at the Expiration Time or the applicable Partnership abandons or terminates its Consent Solicitation with respect to that series of Notes prior to receiving the Requisite Consents as to that series of Notes, any consents received will be voided and no Consent Fee will be paid to the holders of that series of Notes. The Consent Solicitations will expire at 5:00 p.m., New York City time, on January 18, 2019 (the "Expiration Time"), unless extended by the applicable Partnership with respect to one or more series of Notes.
The purpose of the Consent Solicitations is to amend the indenture governing the EEP Notes and the indenture governing to the SEP Notes to modify the reporting covenant contained in each indenture with respect to each series of EEP Notes and SEP Notes to provide that, in the event Enbridge guarantees a series of such Notes, then in lieu of the respective Partnership's current reporting obligations under its indenture with respect to such series of Notes, Enbridge would be subject to reporting obligations under such indenture similar to those in the indenture governing Enbridge's U.S. dollar denominated senior notes. The Amendments will also add provisions, in the event Enbridge guarantees a series of Notes, implementing the unconditional guarantee of such series of Notes by Enbridge.
Each Partnership will be deemed to have accepted all consents delivered (and not revoked) by the holders of record of a series of its Notes upon execution of a supplemental indenture containing the applicable Amendments relating to that series of Notes as described in the Consent Solicitation Statement. Upon execution of such a supplemental indenture, all holders of record of that series of Notes, including non-consenting holders and all subsequent holders of that series of Notes, will be bound by the Amendments to such indenture.
This press release does not set forth all of the terms and conditions of the Consent Solicitations. Holders should carefully read the Consent Solicitation Statement related to the Consent Solicitations and any accompanying materials for a complete description of all terms and conditions of the Consent Solicitations before making any decision with respect to the Consent Solicitations. Additional information concerning the terms and conditions of the Consent Solicitations, and the procedure for delivering consents, may be obtained from the solicitation agents, J.P. Morgan Securities LLC at (866) 834-4666 (toll free) or (212) 834-3424 (collect) and MUFG Securities Americas Inc. (877) 744-4532 (toll free), (212) 405-7481 (collect) or (44) 207-577-4048/4218 (int'l). Copies of the Consent Solicitation Statement and related documents may be obtained from the information agent, D. F. King & Co., Inc., by calling (212) 269-5550 (collect for banks and brokers) or (800) 398-1247 (toll free for all others), or sending an email message to enbridge@dfking.com and requesting that a copy be provided to you.
Neither of the Partnerships, the applicable trustees, J.P. Morgan Securities LLC, MUFG Securities Americas Inc., D. F. King & Co., Inc. or any of their respective affiliates is making any recommendation as to whether or not holders of any series of Notes should deliver their consent to the applicable Amendments.
This announcement is for informational purposes only and is neither an offer to sell nor a solicitation of an offer to buy Notes or any other securities. This announcement is also not a solicitation of consents with respect to the Amendments or any securities. Each Partnership reserves the right to modify or terminate each of its Consent Solicitations and may do so without modifying or terminating any other Consent Solicitation. The solicitations of consents are not being made in any jurisdiction in which, or to or from any person to or from whom, it is unlawful to make such solicitations under applicable state or foreign securities or "blue sky" laws.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words "assumes," "believes," "estimates," "expects," "guidance," "intends," "plans," "projects," and similar expressions that do not relate to historical matters. All statements other than statements of historical fact are forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors which are, in some cases, beyond our control and could materially affect actual results, performance, or achievements. Important risk factors that may affect the Consent Solicitations and our business, results of operations and financial position are detailed in the Consent Solicitation Statement and in the reports we file with the U.S. Securities and Exchange Commission. Actual operating results may differ materially from what is expressed or forecast in this press release. We undertake no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as may be required by applicable law.
About Enbridge Inc.
Enbridge is North America's premier energy infrastructure company with strategic business platforms that include an extensive network of crude oil, liquids and natural gas pipelines, regulated natural gas distribution utilities and renewable power generation. The Company safely delivers an average of 2.9 million barrels of crude oil each day through its Mainline and Express Pipeline; accounts for approximately 62% of U.S.-bound Canadian crude oil exports; and moves approximately 22% of all natural gas consumed in the U.S., serving key supply basins and demand markets. The Company's regulated utilities serve approximately 3.7 million retail customers in Ontario, Quebec, and New Brunswick. Enbridge also has interests in more than 1,700 MW of net renewable generating capacity in North America and Europe. The Company has ranked on the Global 100 Most Sustainable Corporations index for the past nine years; its common shares trade on the Toronto and New York stock exchanges under the symbol ENB.
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. Information about EEP is available on its website at www.enbridgepartners.com.
About Spectra Energy Partners, LP
Spectra Energy Partners, LP connects growing supply areas to high-demand markets for natural gas and crude oil. Its assets include approximately 16,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Information about SEP is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media
Michael Barnes
Toll Free: (888) 992-0997
Email: media@enbridge.com
Investment Community
Jonathan Gould
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
SOURCE Enbridge Inc.
CALGARY and HOUSTON, Dec. 17, 2018 /PRNewswire/ - Enbridge Inc. (TSX: ENB) (NYSE: ENB) (Enbridge), on behalf of itself and certain of its wholly owned U.S. subsidiaries, and Spectra Energy Partners, LP (NYSE: SEP) (SEP) today announced that they have completed the previously announced merger (the Merger) pursuant to an Agreement and Plan of Merger dated as of August 24, 2018 (the Merger Agreement). The Merger resulted in Enbridge (through a wholly owned subsidiary) acquiring all of the outstanding public common units of SEP and SEP becoming an indirect, wholly owned subsidiary of Enbridge.
Effective today, SEP unitholders of record as of the close of business on November 5, 2018 (other than Enbridge and its subsidiaries) are entitled to receive from Enbridge pursuant to the Merger Agreement, for each SEP common unit held, 1.111 common shares of Enbridge.
Also effective today, the SEP common units will be suspended from trading on, and delisted from, the New York Stock Exchange (NYSE). Common shares of Enbridge will continue to trade on both the NYSE and the Toronto Stock Exchange under the symbol "ENB".
Forward Looking Statements
Certain information provided in this news release constitutes forward-looking statements. The words "anticipate", "expect", "project" and similar words and expressions are intended to identify such forward-looking statements. All statements other than statements of historical fact may constitute forward-looking statements Forward-looking information or statements included or incorporated by reference in this document include, but are not limited to, statements with respect to the suspension of the SEP common units from trading on, and delisting from, the NYSE. Although Enbridge and SEP believe these statements are based on information and assumptions which are current, reasonable and complete, these statements are not guarantees of future performance and readers are cautioned against placing undue reliance on forward-looking statements. By their nature, these statements involve a variety of assumptions, risks and uncertainties which may cause actual results to differ from those expressed or implied by such statements. Material assumptions include assumptions about the satisfaction of all conditions to the suspension from trading and delisting of the SEP common units. While Enbridge and SEP make these forward-looking statements in good faith, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. Except as may be required by applicable securities laws, Enbridge and SEP assume no obligation to publicly update or revise any forward-looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.
About Enbridge Inc.
Enbridge Inc. is North America's premier energy infrastructure company with strategic business platforms that include an extensive network of crude oil, liquids and natural gas pipelines, regulated natural gas distribution utilities and renewable power generation. The Company safely delivers an average of 2.9 million barrels of crude oil each day through its Mainline and Express Pipeline; accounts for approximately 62% of U.S.-bound Canadian crude oil exports; and moves approximately 22% of all natural gas consumed in the U.S., serving key supply basins and demand markets. The Company's regulated utilities serve approximately 3.7 million retail customers in Ontario, Quebec, and New Brunswick. Enbridge also has interests in more than 1,700 MW of net renewable generating capacity in North America and Europe. The Company has ranked on the Global 100 Most Sustainable Corporations index for the past nine years; its common shares trade on the Toronto and New York stock exchanges under the symbol ENB.
Life takes energy and Enbridge exists to fuel people's quality of life. For more information, visit www.enbridge.com.
About Spectra Energy Partners, LP
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include approximately 16,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Information about Spectra Energy Partners, LP is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media
Michael Barnes
Toll Free: (888) 992-0997
Email: media@enbridge.com
Investment Community
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
View original content:http://www.prnewswire.com/news-releases/enbridge-inc-and-spectra-energy-partners-lp-complete-merger-300767348.html
SOURCE Enbridge Inc.
DALLAS, Dec. 13, 2018 /PRNewswire/ -- Alerian announced today that Spectra Energy Partners (NYSE: SEP) is to be removed from the Alerian Midstream Energy Index (AMNA), Alerian US Midstream Energy Index (AMUS), Alerian MLP Index (AMZ), Alerian MLP Equal Weight Index (AMZE), Alerian MLP Infrastructure Index (AMZI), and Alerian Natural Gas MLP Index (ANGI) in a special rebalancing.
Special rebalancings are triggered by corporate actions such as mergers, bankruptcies, and liquidations. SEP will cease to trade due to its merger with Enbridge Inc. The rebalancing will take place after market close on December 14, 2018.
Each index will be rebalanced in accordance with its existing methodology. Constituent additions to and deletions from an index do not reflect an opinion by Alerian on the investment merits of the respective securities.
For more information about Alerian's indices, including methodology, please visit: www.alerian.com/indices.
About Alerian
Alerian equips investors to make informed decisions about energy infrastructure and Master Limited Partnerships (MLPs). Its benchmarks are widely used by industry executives, investment professionals, research analysts, and national media to analyze relative performance. As of November 30, 2018, over $13 billion is directly tied to the Alerian Index Series through exchange-traded funds and notes, separately managed accounts, and structured products. Visit alerian.com to learn more.
View original content:http://www.prnewswire.com/news-releases/spectra-energy-partners-to-be-removed-from-the-alerian-index-series-300764854.html
SOURCE Alerian
HOUSTON, TX, Dec. 6, 2018 /PRNewswire/ - Spectra Energy Partners, LP (NYSE: SEP) (SEP) today announced that the period for unitholders of SEP to return their written consents with respect to the merger (the Merger) of SEP and a wholly owned subsidiary of Enbridge Inc. (TSX: ENB) (NYSE: ENB) (Enbridge) will expire on December 12, 2018.
The Merger will be effected pursuant to an Agreement and Plan of Merger dated as of August 24, 2018 (the Merger Agreement) and will result in Enbridge (through a wholly owned subsidiary) acquiring all of the outstanding public common units of SEP and SEP becoming an indirect, wholly owned subsidiary of Enbridge. Pursuant to the Merger Agreement, at the closing, each public common unit of SEP will be exchanged for 1.111 common shares of Enbridge.
The Board of Directors of the general partner of SEP recommends that SEP unitholders approve the Merger and the Merger Agreement. In addition, Institutional Shareholder Services Inc. (ISS), a leading independent proxy advisory firm, has also recommended that SEP unitholders approve the Merger and the Merger Agreement.
SEP unitholders of record as of the close of business on November 5, 2018, are entitled to execute and deliver to SEP a written consent with respect to the Merger and the Merger Agreement. SEP encourages its unitholders to return their written consents as soon as possible but no later than 11:59 p.m. (Eastern Time) on December 12, 2018. Copies of the consent solicitation statement/prospectus related to the transaction and related documents are available on EDGAR at www.sec.gov.
Unitholders who have questions or require assistance in submitting their written consents may direct their inquiry to the proxy solicitation agent, D.F. King & Co., Inc., by calling toll free in North America at (888) 777-0320 or by email at enbridge@dfking.com.
The transaction is expected to close December 17, 2018, pursuant to the terms of the Merger Agreement.
FORWARD-LOOKING INFORMATION
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. Forward looking statements are based on the beliefs and assumptions of Enbridge, Enbridge Energy Partners, L.P. ("EEP"), Enbridge Energy Management, L.L.C. ("EEQ"), SEP, and Enbridge Income Fund Holdings Inc. ("ENF" and, together with EEP, EEQ and SEP, the "Sponsored Vehicles"). These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast and similar expressions and include, but are not limited to, statements regarding the expected closing, consummation, completion, timing and benefits of the acquisitions of the Sponsored Vehicles (collectively, the "Proposed Transactions"), the expected synergies and equityholder value to result from the combined companies, the expected levels of cash distributions or dividends by the Sponsored Vehicles to their respective shareholders or unitholders, the expected levels of dividends by Enbridge to its shareholders, the expected financial results of Enbridge and its Sponsored Vehicles and their respective affiliates, and the future credit ratings, financial condition and business strategy of Enbridge, its Sponsored Vehicles and their respective affiliates.
Although Enbridge and its Sponsored Vehicles believe these forward-looking statements are reasonable based on the information available on the date such statements are made and processes used to prepare the information, such statements are not guarantees of future performance and readers are cautioned against placing undue reliance on forward-looking statements. By their nature, these statements involve a variety of assumptions, known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such statements. Material assumptions include assumptions about the following: the expected supply of and demand for crude oil, natural gas, natural gas liquids ("NGL") and renewable energy; prices of crude oil, natural gas, NGL and renewable energy; exchange rates; inflation; interest rates; availability and price of labor and construction materials; operational reliability; customer and regulatory approvals; maintenance of support and regulatory approvals for projects; anticipated in-service dates; weather; the timing and closing of dispositions; the realization of anticipated benefits and synergies of the Proposed Transactions; governmental legislation; acquisitions and the timing thereof; the success of integration plans; impact of capital project execution on future cash flows; credit ratings; capital project funding; expected earnings; expected future cash flows; and estimated future dividends. Assumptions regarding the expected supply of and demand for crude oil, natural gas, NGL and renewable energy, and the prices of these commodities, are material to and underlie all forward-looking statements, as they may impact current and future levels of demand for Enbridge's and its Sponsored Vehicles' services. Similarly, exchange rates, inflation and interest rates impact the economies and business environments and may impact levels of demand for Enbridge's and its Sponsored Vehicles' services and cost of inputs, and are therefore inherent in all forward looking statements. Due to the interdependencies and correlation of these macroeconomic factors, the impact of any one assumption on a forward-looking statement cannot be determined with certainty, particularly with respect to the impact of the Proposed Transactions, expected earnings and cash flow or estimated future dividends.
Forward looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. There are a number of important factors that could cause actual results to differ materially from those indicated in any forward looking statement including, but not limited to: the risk that the Proposed Transactions do not occur; negative effects from the pendency of the Proposed Transactions; the ability to realize expected cost savings and benefits from the Proposed Transactions; the timing to consummate the Proposed Transactions; whether the Sponsored Vehicles or Enbridge will produce sufficient cash flows to provide the level of cash distributions they expect with respect to their respective units or shares; outcomes of litigation and regulatory investigations, proceedings or inquiries; operating performance of Enbridge and its Sponsored Vehicles; regulatory parameters regarding Enbridge and its Sponsored Vehicles; other Enbridge dispositions; project approval and support; renewals of rights of way; weather, economic and competitive conditions; public opinion; changes in tax laws and tax rates; changes in trade agreements, exchange rates, interest rates, commodity prices, political decisions and supply of and demand for commodities; and any other risks and uncertainties discussed herein or in Enbridge's or its Sponsored Vehicles' other filings with Canadian and United States securities regulators. All forward-looking statements in this communication are made as of the date hereof and, except to the extent required by applicable law, neither Enbridge nor any of the Sponsored Vehicles assume any obligation to publicly update or revise any forward looking statements made in this communication or otherwise, whether as a result of new information, future events or otherwise. All subsequent forward looking statements, whether written or oral, attributable to Enbridge, its Sponsored Vehicles or persons acting on their behalf, are expressly qualified in their entirety by these cautionary statements. The factors described above, as well as additional factors that could affect Enbridge's or any of its Sponsored Vehicles' respective forward looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward Looking Information" in Enbridge's Annual Report on Form 10-K for the fiscal year ended December 31, 2017, which was filed with the U.S. Securities and Exchange Commission ("SEC") and Canadian securities regulators on February 16, 2018, each of EEP's, EEQ's and SEP's Annual Report on Form 10-K for the fiscal year ended December 31, 2017, which were filed with the SEC on February 16, 2018, ENF's Management's Discussion and Analysis for the year ended December 31, 2017, which was filed with Canadian securities regulators on February 16, 2018, and in Enbridge's and its Sponsored Vehicles' respective other filings made with the SEC and Canadian securities regulators, which are available via the SEC's website at http://www.sec.gov and at http://www.sedar.com, as applicable.
Additional Information about Enbridge and the Proposed Transactions and Where to Find It
This communication may be deemed solicitation material in respect of the Proposed Transactions. The registration statements of Enbridge in respect of the EEP, EEQ and SEP transactions were declared effective on November 9, 2018 and definitive proxy statements/consent statements, along with the applicable written consents or forms of proxy, of EEP, EEQ and SEP were filed with the SEC on November 9, 2018 and mailed to the respective security holders of EEP, EEQ and SEP on or about November 13, 2018. INVESTORS AND SECURITY HOLDERS OF ENBRIDGE AND ITS SPONSORED VEHICLES ARE URGED TO READ THE APPLICABLE REGISTRATION STATEMENT, DEFINITIVE PROXY OR CONSENT SOLICITATION STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS THAT ARE OR WILL BE FILED WITH THE SEC OR CANADIAN SECURITIES REGULATORS, AS APPLICABLE, CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTIONS. Investors, shareholders and unitholders can obtain free copies of such documents containing important information about Enbridge and its Sponsored Vehicles, through the website maintained by the SEC at http://www.sec.gov or with Canadian securities regulators through the SEDAR website at http://www.sedar.com, as applicable. Copies can also be obtained, without charge, by directing a request to Enbridge Inc., 200, 425 – 1st Street S.W., Calgary, Alberta, Canada T2P 3L8, Attention: Investor Relations.
Participants in the Solicitations
Enbridge, each of its Sponsored Vehicles, and certain of their respective directors and executive officers, may be deemed participants in the solicitation of consents or proxies from the holders of equity securities of the Sponsored Vehicles in connection with the Proposed Transactions. Information about the directors and executive officers of Enbridge is set forth in its definitive proxy statement filed with the SEC on April 5, 2018. Information about the directors and executive officers of EEP, EEQ and SEP is set forth in EEP's, EEQ's and SEP's Annual Report on Form 10-K for the fiscal year ended December 31, 2017, respectively, each of which was filed with the SEC on February 16, 2018. Information about the directors and executive officers of ENF is set forth in ENF's Annual Information Form for the fiscal year ended December 31, 2017, which was filed with Canadian securities regulators on February 16, 2018. Each of these documents can be obtained free of charge from the sources indicated above. Other information regarding the participants in any consent or proxy solicitation with respect to the Proposed Transactions and a description of their direct and indirect interests, by security holdings or otherwise, are contained in the relevant definitive proxy or consent statement/prospectus filed by Enbridge/EEP/EEQ and SEP with the SEC on November 9, 2018.
About Spectra Energy Partners, LP
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include approximately 16,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York Stock Exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media
Michael Barnes
Toll Free: (888) 992-0997
Email: media@enbridge.com
Investment Community
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
View original content:http://www.prnewswire.com/news-releases/spectra-energy-partners-lp-unitholder-consent-solicitation-period-to-expire-on-december-12-2018-300761487.html
SOURCE Spectra Energy Partners, LP
HOUSTON, Nov. 1, 2018 /PRNewswire/ - Spectra Energy Partners, LP (NYSE: SEP) today reported net income of $377 million, of which $366 million is attributable to SEP's controlling interests, for the third quarter ended September 30, 2018, with earnings per limited partner unit of $0.75.
THIRD QUARTER HIGHLIGHTS:
FINANCIAL RESULTS
For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $561 million, compared with $554 million in the prior-year quarter. Ongoing net income from controlling interests was $371 million for the quarter, or $0.76 earnings per limited partner unit, compared with $379 million, or $0.89 earnings per limited partner unit in the prior-year quarter. Net income from controlling interests was $366 million for the quarter, or $0.75 earnings per limited partner unit, compared with $460 million, or $1.15 earnings per limited partner unit in the prior-year quarter.
Third quarter 2018 ongoing distributable cash flow (DCF) was $364 million, compared with $398 million in the prior-year quarter.
QUARTERLY DISTRIBUTION
Spectra Energy Partners announced today that the board of directors of the general partner declared a quarterly cash distribution to unitholders of $0.77625 per unit, an increase of 1.25 cents over the previous level of $0.76375 per unit and an approximate 7 percent increase compared to the third quarter 2017. The cash distribution is payable on November 29, 2018, to unitholders of record at the close of business on November 21, 2018. This quarterly cash distribution equates to $3.105 per unit on an annual basis.
PROPOSED MERGER
On August 24, 2018, SEP announced that it had entered into a definitive agreement (the Merger Agreement), pursuant to which an indirect wholly-owned subsidiary of Enbridge will be merged with and into SEP, with SEP surviving as an indirect wholly-owned subsidiary of Enbridge. Under the terms of the Merger Agreement, Enbridge will acquire all of SEP's outstanding common units not already directly or indirectly owned by Enbridge in an all stock-for-unit transaction at an exchange ratio of 1.111 Enbridge common shares per SEP common unit. The proposed merger is part of Enbridge's sponsored vehicle restructuring initiative to simplify its corporate structure.
A record date of November 5, 2018 has been established for determining the unitholders of SEP entitled to approve the SEP merger transaction without a meeting, which approval by written consent is expected to be determined on December 12, 2018. Pursuant to the Merger Agreement, Enbridge has irrevocably and unconditionally agreed to deliver its consent, with respect to all of the SEP common units owned by its wholly owned subsidiaries, in favor of approval of the transaction. As the majority SEP unitholder (83% of total SEP common units outstanding), Enbridge's approval by consent will constitute the requisite SEP unitholder vote required to approve the transaction.
Completion of the proposed merger is subject to certain customary closing conditions and is targeted to occur in the fourth quarter of 2018.
SEGMENT RESULTS
U.S. Transmission
Ongoing EBITDA from U.S. Transmission was $504 million in the third quarter 2018, compared with $505 million for the third quarter 2017. These results reflect increased earnings from expansion projects, increased revenue contracts on Sabal Trail, and higher allowance for funds used during construction on NEXUS, offset by higher operating and pipeline integrity costs and higher allocated corporate shared-service costs of $18 million, previously recorded in "Other". The 2017 ongoing results exclude a $106 million gain realized as a result of the deconsolidation and fair value re-measurement of our interest in Sabal Trail. The 2017 ongoing results also exclude special items of $18 million in expenses related to the 2016 Texas Eastern pipeline incident and $4 million in expenses primarily from merger-related costs.
Liquids
Ongoing EBITDA from Liquids was $59 million in the third quarter 2018, compared with $67 million for the third quarter 2017. The decrease is primarily a result of higher property taxes, regulatory expenses and allocated corporate shared-service costs of $4 million, previously recorded in "Other", partially offset by an increase in transportation volumes.
Other
Beginning with first quarter of 2018, "Other" consists of certain direct corporate governance costs. Allocated corporate shared-service costs were previously included in "Other" but are now directly allocated to the business segments. Ongoing net expenses from "Other" were $2 million and $18 million in third quarters 2018 and 2017, respectively. These results primarily reflect lower allocated corporate shared-services costs now included in U.S. Transmission and Liquids. The 2018 ongoing results exclude special items of $4 million in expenses, primarily from the proposed merger with Enbridge. The 2017 period excludes special items of $3 million, primarily from merger-related severance costs.
Interest Expense
Interest expense was $85 million in the third quarter 2018, compared with $75 million in the third quarter 2017, reflecting an increase in interest rates related to short-term borrowings and a higher balance of long-term debt outstanding.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy Partners as of September 30, 2018, was $8.8 billion, with available liquidity of approximately $1.1 billion, including cash on hand.
Including contributions from noncontrolling interests, Spectra Energy Partners has $1.6 billion of capital expansion spending planned in 2018. Total capital spending for the nine months ended September 30, 2018, was $1.2 billion, consisting of $1.1 billion of growth capital expenditures and $145 million of maintenance capital expenditures.
EXPANSION PROJECT UPDATES
SEP placed the NEXUS and TEAL projects into service in early October and volumes will continue to ramp up in the fourth quarter. The combined projects totaling $1.5 billion represent the successful culmination of more than four years of working with many stakeholders to provide natural gas to markets in Ohio, Michigan and Ontario.
We continue to advance the second stage of Atlantic Bridge, with its full capacity targeted for commercial availability in the fourth quarter 2018, which will add much needed capacity to the New England region.
Additionally, the South Texas Expansion Project (STEP) and the Pomelo Connector are both on track for an in-service date in the fourth quarter 2018. The projects provide an important link in SEP's South Texas infrastructure, supporting reliable gas transportation for exports to serve Mexico's growing natural gas demand.
ADDITIONAL INFORMATION
Additional information about third quarter 2018 earnings can be obtained via the Spectra Energy Partners website: www.spectraenergypartners.com.
Spectra Energy Partners will host a joint webcast with Enbridge Inc. (TSX: ENB) (NYSE: ENB) on November 2, 2018, at 8 a.m. CT. The webcast will be available via the Spectra Energy Partners Events & Presentations page, and the conference call can be accessed by dialing (877) 930-8043 in North America or (253) 336-7522 outside North America. The participant passcode is 6465399#.
A replay of the call will be available via the Spectra Energy Partners Events & Presentations page, or by dialing (855) 859-2056 in North America or (404) 537-3406 outside North America and using the above passcode.
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.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests as a measure to evaluate operations of the partnership. This measure is a non-GAAP financial measure as it represents net income from controlling interests, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measure for ongoing net income from controlling interests is net income from controlling interests.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Partners, LP. Ongoing EBITDA represents EBITDA, excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Partners, LP's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Partners, LP is net income.
The primary performance measures used by us to evaluate segment performance are segment EBITDA and Other EBITDA. We consider segment EBITDA and Other EBITDA, which are the GAAP measures used to report segment results, to be good indicators of each segment's operating performance from its continuing operations as they represent the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA and Other EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA as a measure of performance. Ongoing segment EBITDA is a non-GAAP financial measure, as it represents reported segment EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's ongoing performance across periods. The most directly comparable GAAP measure for ongoing segment EBITDA is segment EBITDA.
We also present Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the partnership to support distribution growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF, excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by distributions declared on partnership units. The most directly comparable GAAP measure for DCF coverage is earnings per limited partner unit.
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other partnerships because other partnerships may not calculate these measures in the same manner.
Distribution Information
This information is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Under rules applicable to publicly-traded partnerships, our distributions to non-U.S. unitholders are subject to withholding tax at the highest effective applicable rate to the extent attributable to income that is effectively connected with the conduct of a U.S. trade or business. Given the uncertainty at the time of making distributions regarding the amount of any distribution that is attributable to income that is so effectively connected, we intend to treat all of our distributions as attributable to our U.S. operations, and as a result, the entire distribution will be subject to withholding.
Forward-Looking Statements
This 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 August 24, 2018, among Spectra Energy Partners, LP, Spectra Energy Partners (DE) GP, LP, Enbridge Inc. (Enbridge), Enbridge (U.S.) Inc., Autumn Acquisition Sub, LLC, and, solely for the purposes of Articles I, II and XI, Enbridge US Holdings Inc., Spectra Energy Corp, Spectra Energy Capital, LLC and Spectra Energy Transmission, LLC (the Proposed Merger). Forward-looking statements represent management's intentions, plans, expectations, assumptions and beliefs about future events. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. Factors used to develop these forward-looking statements and that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, provincial, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; interruption of our operations due to social, civil or political events or unrest; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering and other related infrastructure projects and the effects of competition; the performance of natural gas transmission, storage and gathering facilities, and crude oil transportation and storage; the extent of success in connecting natural gas and oil supplies to transmission and gathering systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture, including the Proposed Merger; the risk that Enbridge may be unable to obtain governmental and regulatory approvals required for the Proposed Merger or required governmental 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; the risk that a condition to closing of the Proposed Merger may not be satisfied; the timing to complete the Proposed Merger; the 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; disruption from the Proposed Merger may make it more difficult to maintain relationships with customers, employees or suppliers; and the impact and outcome of pending and future litigation, including litigation, if any, relating to the Proposed Merger. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2017 Form 10-K, filed on February 16, 2018, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include approximately 16,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York Stock Exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media: | Michael Barnes |
Toll Free: (888) 992-0997 | |
michael.barnes@enbridge.com | |
Analysts and Investors: | Toll Free: (800) 481-2804 |
investor.relations@enbridge.com |
Spectra Energy Partners, LP Quarterly Highlights (Unaudited) (in millions, except per-unit amounts) Reported - These results include the impact of special items | |||||||||||
Three Months Ended | Nine Months Ended | ||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||
INCOME (a) | |||||||||||
Operating Revenues | $ | 737 | $ | 693 | $ | 2,242 | $ | 2,088 | |||
Total Reportable Segment EBITDA | 562 | 656 | 1,731 | 1,745 | |||||||
Net Income - Controlling Interests | $ | 366 | $ | 460 | $ | 1,154 | $ | 1,105 | |||
EBITDA BY BUSINESS SEGMENT | |||||||||||
U.S. Transmission | $ | 503 | $ | 589 | $ | 1,530 | $ | 1,548 | |||
Liquids | 59 | 67 | 201 | 197 | |||||||
Total Reportable Segment EBITDA | 562 | 656 | 1,731 | 1,745 | |||||||
Other EBITDA | (6) | (21) | (9) | (92) | |||||||
Total Reportable Segment and Other EBITDA | $ | 556 | $ | 635 | $ | 1,722 | $ | 1,653 | |||
PARTNERS' CAPITAL | |||||||||||
Declared Cash Distribution per Limited Partner Unit | $ | 0.77625 | $ | 0.72625 | $ | 2.29125 | $ | 2.14125 | |||
Weighted Average Units Outstanding | |||||||||||
Limited Partner Units | 485 | 311 | 472 | 310 | |||||||
General Partner Units | — | 6 | — | 6 | |||||||
DISTRIBUTABLE CASH FLOW | |||||||||||
Distributable Cash Flow | $ | 359 | $ | 363 | $ | 1,210 | $ | 1,060 | |||
CAPITAL AND INVESTMENT EXPENDITURES (b) | |||||||||||
Capital expenditures - U.S. Transmission | $ | 641 | $ | 1,576 | |||||||
Capital expenditures - Liquids | 39 | 16 | |||||||||
Investment expenditures | 520 | 218 | |||||||||
Total | $ | 1,200 | $ | 1,810 | |||||||
U.S. TRANSMISSION | |||||||||||
Operating Revenues | $ | 633 | $ | 595 | $ | 1,928 | $ | 1,783 | |||
Operating Expenses | |||||||||||
Operating, Maintenance and Other | 230 | 181 | 656 | 582 | |||||||
Other Income and Expenses | 100 | 175 | 258 | 347 | |||||||
EBITDA | $ | 503 | $ | 589 | $ | 1,530 | $ | 1,548 | |||
LIQUIDS | |||||||||||
Operating Revenues | $ | 104 | $ | 98 | $ | 314 | $ | 305 | |||
Operating Expenses | |||||||||||
Operating, Maintenance and Other | 45 | 28 | 114 | 104 | |||||||
Other Income and Expenses | — | (3) | 1 | (4) | |||||||
EBITDA | $ | 59 | $ | 67 | $ | 201 | $ | 197 | |||
Express Pipeline Revenue Receipts, MBbl/d (c) | 259 | 255 | 261 | 260 | |||||||
Platte PADD II Deliveries, MBbl/d (c) | 123 | 119 | 129 | 133 | |||||||
Canadian Dollar Exchange Rate, Average | 1.31 | 1.25 | 1.29 | 1.31 | |||||||
September 30, | December 31, | ||||||||||
2018 | 2017 | ||||||||||
Debt | $ | 8,795 | $ | 8,463 | |||||||
Actual Units Outstanding | 485 | 319 | |||||||||
(a) Reported results reflect the impact of the U.S. Federal Tax Reform Legislation enacted in December 2017. | |||||||||||||||
(b) Excludes contributions received from noncontrolling interests of $1 million in 2018 and $416 million in 2017. | |||||||||||||||
(c) Thousand barrels per day. |
Spectra Energy Partners, LP Condensed Consolidated Statements of Operations (Unaudited) (in millions) Reported - These results include the impact of special items | |||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||
Operating Revenues | $ | 737 | $ | 693 | $ | 2,242 | $ | 2,088 | |||||
Operating Expenses | 370 | 319 | 1,047 | 1,039 | |||||||||
Operating Income | 367 | 374 | 1,195 | 1,049 | |||||||||
Other Income and Expenses | 98 | 176 | 261 | 348 | |||||||||
Interest Expense | 85 | 75 | 255 | 191 | |||||||||
Earnings Before Income Taxes | 380 | 475 | 1,201 | 1,206 | |||||||||
Income Tax Expense | 3 | 4 | 15 | 14 | |||||||||
Net Income | 377 | 471 | 1,186 | 1,192 | |||||||||
Net Income - Noncontrolling Interests | 11 | 11 | 32 | 87 | |||||||||
Net Income - Controlling Interests | $ | 366 | $ | 460 | $ | 1,154 | $ | 1,105 |
Spectra Energy Partners, LP Condensed Consolidated Balance Sheets (Unaudited) (in millions) | ||||||
September 30, | December 31, | |||||
2018 | 2017 | |||||
ASSETS | ||||||
Current Assets | $ | 695 | $ | 561 | ||
Investments and Goodwill | 6,055 | 6,259 | ||||
Net Property, Plant and Equipment | 15,322 | 14,899 | ||||
Regulatory and Other Assets | 339 | 337 | ||||
Total Assets | $ | 22,411 | $ | 22,056 | ||
LIABILITIES AND EQUITY | ||||||
Current Liabilities | $ | 557 | $ | 1,105 | ||
Loan from Affiliate | 638 | — | ||||
Long-term Debt | 8,157 | 7,963 | ||||
Other Liabilities | 1,057 | 1,087 | ||||
Equity | 12,002 | 11,901 | ||||
Total Liabilities and Equity | $ | 22,411 | $ | 22,056 |
Spectra Energy Partners, LP | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net Income | $ | 377 | $ | 471 | $ | 1,186 | $ | 1,192 | |||||||
Add: | |||||||||||||||
Interest expense | 85 | 75 | 255 | 191 | |||||||||||
Income tax expense | 3 | 4 | 15 | 14 | |||||||||||
Depreciation and amortization | 89 | 86 | 268 | 258 | |||||||||||
Foreign currency (gain) loss | 2 | (1) | (1) | (1) | |||||||||||
Less: | |||||||||||||||
Third party interest income | — | — | 1 | 1 | |||||||||||
EBITDA | 556 | 635 | 1,722 | 1,653 | |||||||||||
Add: | |||||||||||||||
Earnings from equity investments | (81) | (161) | (210) | (239) | |||||||||||
Distributions from equity investments | 57 | 54 | 192 | 132 | |||||||||||
Noncash Impact of the U.S. Tax Reform | — | — | (25) | — | |||||||||||
Other | 9 | 9 | 6 | 9 | |||||||||||
Less: | |||||||||||||||
Interest expense | 85 | 75 | 255 | 191 | |||||||||||
Equity AFUDC | 14 | 14 | 29 | 107 | |||||||||||
Net cash paid for income taxes | 1 | 4 | 6 | 12 | |||||||||||
Distributions to non-controlling interests | 12 | 12 | 40 | 37 | |||||||||||
Maintenance capital expenditures | 70 | 69 | 145 | 148 | |||||||||||
Total Distributable Cash Flow | $ | 359 | $ | 363 | $ | 1,210 | $ | 1,060 |
Spectra Energy Partners, LP Reported to Ongoing Distributable Cash Flow Reconciliation (Unaudited) (in millions) | ||||||||||||||||||||
Three months ended | ||||||||||||||||||||
September 30, 2018 | September 30, 2017 | |||||||||||||||||||
Reported | Less: | Ongoing | Reported | Less: | Ongoing | |||||||||||||||
Net Income | $ | 377 | $ | (5) | $ | 382 | $ | 471 | $ | 81 | $ | 390 | ||||||||
Add: | ||||||||||||||||||||
Interest expense | 85 | — | 85 | 75 | — | 75 | ||||||||||||||
Income tax expense | 3 | — | 3 | 4 | — | 4 | ||||||||||||||
Depreciation and amortization | 89 | — | 89 | 86 | — | 86 | ||||||||||||||
Foreign currency (gain) loss | 2 | — | 2 | (1) | — | (1) | ||||||||||||||
Less: | ||||||||||||||||||||
Third party interest income | — | — | — | — | — | — | ||||||||||||||
EBITDA | 556 | (5) | 561 | 635 | 81 | 554 | ||||||||||||||
Add: | ||||||||||||||||||||
Earnings from equity investments | (81) | — | (81) | (161) | (106) | (55) | ||||||||||||||
Distributions from equity investments | 57 | — | 57 | 54 | — | 54 | ||||||||||||||
Other | 9 | — | 9 | 9 | — | 9 | ||||||||||||||
Less: | ||||||||||||||||||||
Interest expense | 85 | — | 85 | 75 | — | 75 | ||||||||||||||
Equity AFUDC | 14 | — | 14 | 14 | — | 14 | ||||||||||||||
Net cash paid for income taxes | 1 | — | 1 | 4 | — | 4 | ||||||||||||||
Distributions to non-controlling interests | 12 | — | 12 | 12 | — | 12 | ||||||||||||||
Maintenance capital expenditures | 70 | — | 70 | 69 | 10 | 59 | ||||||||||||||
Total Distributable Cash Flow | $ | 359 | $ | (5) | $ | 364 | $ | 363 | $ | (35) | $ | 398 |
Spectra Energy Partners, LP Reported to Ongoing Distributable Cash Flow Reconciliation (Unaudited) (in millions) | |||||||||||||||||||||||
Nine Months Ended | |||||||||||||||||||||||
September 30, 2018 | September 30, 2017 | ||||||||||||||||||||||
Reported | Less: | Ongoing | Reported | Less: | Ongoing | ||||||||||||||||||
Net Income | $ | 1,186 | $ | 16 | $ | 1,170 | $ | 1,192 | $ | 6 | $ | 1,186 | |||||||||||
Add: | |||||||||||||||||||||||
Interest expense | 255 | — | 255 | 191 | — | 191 | |||||||||||||||||
Income tax expense | 15 | — | 15 | 14 | — | 14 | |||||||||||||||||
Depreciation and amortization | 268 | — | 268 | 258 | — | 258 | |||||||||||||||||
Foreign currency (gain) loss | (1) | — | (1) | (1) | — | (1) | |||||||||||||||||
Less: | |||||||||||||||||||||||
Third party interest income | 1 | — | 1 | 1 | — | 1 | |||||||||||||||||
EBITDA | 1,722 | 16 | 1,706 | 1,653 | 6 | 1,647 | |||||||||||||||||
Add: | |||||||||||||||||||||||
Earnings from equity investments | (210) | — | (210) | (239) | (106) | (133) | |||||||||||||||||
Distributions from equity investments | 192 | — | 192 | 132 | — | 132 | |||||||||||||||||
Noncash Impact of the U.S. Tax Reform | (25) | (25) | — | — | — | — | |||||||||||||||||
Other | 6 | — | 6 | 9 | — | 9 | |||||||||||||||||
Less: | |||||||||||||||||||||||
Interest expense | 255 | — | 255 | 191 | — | 191 | |||||||||||||||||
Equity AFUDC | 29 | — | 29 | 107 | — | 107 | |||||||||||||||||
Net cash paid for income taxes | 6 | — | 6 | 12 | — | 12 | |||||||||||||||||
Distributions to non-controlling interests | 40 | — | 40 | 37 | — | 37 | |||||||||||||||||
Maintenance capital expenditures | 145 | — | 145 | 148 | 12 | 136 | |||||||||||||||||
Total Distributable Cash Flow | $ | 1,210 | $ | (9) | $ | 1,219 | $ | 1,060 | $ | (112) | $ | 1,172 |
Spectra Energy Partners, LP Reported to Ongoing Earnings Reconciliation September 2018 Quarter-to-Date (Unaudited) (in millions) | ||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND | Reported | Less: |
Ongoing | |||||||
U.S. Transmission | $ | 503 | $ | (1) | (a) | $ | 504 | |||
Liquids | 59 | — | 59 | |||||||
Total Reportable Segment EBITDA | 562 | (1) | 563 | |||||||
Other | (6) | (4) | (b) | (2) | ||||||
Total Reportable Segment and Other EBITDA | $ | 556 | $ | (5) | $ | 561 | ||||
EARNINGS | ||||||||||
Total Reportable Segment EBITDA and Other EBITDA | $ | 556 | $ | (5) | $ | 561 | ||||
Depreciation and Amortization | (89) | — | (89) | |||||||
Interest Expense | (85) | — | (85) | |||||||
Other Income and Expenses | (2) | — | (2) | |||||||
Income Tax Expense | (3) | — | (3) | |||||||
Total Net Income | 377 | (5) | 382 | |||||||
Total Net Income - Noncontrolling Interests | (11) | — | (11) | |||||||
Total Net Income - Controlling Interests | $ | 366 | $ | (5) | $ | 371 | ||||
(a) Primarily consists of merger-related severance costs in 2018. | |||||||||||||
(b) Primarily consists of restructuring costs related to the proposed merger. |
Spectra Energy Partners, LP Reported to Ongoing Earnings Reconciliation September 2018 Year-to-Date (Unaudited) (in millions) | ||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND | Reported | Less: | Ongoing | |||||||||
U.S. Transmission | $ | 1,530 | $ | 13 | (a) | $ | 1,517 | |||||
Liquids | 201 | 7 | (b) | 194 | ||||||||
Total Reportable Segment EBITDA | 1,731 | 20 | 1,711 | |||||||||
Other | (9) | (4) | (c) | (5) | ||||||||
Total Reportable Segment and Other EBITDA | $ | 1,722 | $ | 16 | $ | 1,706 | ||||||
EARNINGS | ||||||||||||
Total Reportable Segment EBITDA and Other EBITDA | $ | 1,722 | $ | 16 | $ | 1,706 | ||||||
Depreciation and Amortization | (268) | — | (268) | |||||||||
Interest Expense | (255) | — | (255) | |||||||||
Other Income and Expenses | 2 | — | 2 | |||||||||
Income Tax Expense | (15) | — | (15) | |||||||||
Total Net Income | 1,186 | 16 | 1,170 | |||||||||
Total Net Income - Noncontrolling Interests | (32) | — | (32) | |||||||||
Total Net Income - Controlling Interests | $ | 1,154 | $ | 16 | $ | 1,138 | ||||||
(a) Primarily consists of an adjustment to the U.S. Federal Tax Reform Legislation Regulatory Liability established in 2017, partially offset by merger-related severance costs in 2018. | |||||||||||||
(b) Primarily consists of a gain recognized on purchased oil inventory. | |||||||||||||
(c) Primarily consists of restructuring costs related to the proposed merger. |
Spectra Energy Partners, LP Reported to Ongoing Earnings Reconciliation September 2017 Quarter-to-Date (Unaudited) (in millions) | |||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND | Reported | Less: | Ongoing | ||||||||
U.S. Transmission | $ | 589 | $ | 84 | (a) | $ | 505 | ||||
Liquids | 67 | — | 67 | ||||||||
Total Reportable Segment EBITDA | 656 | 84 | 572 | ||||||||
Other | (21) | (3) | (b) | (18) | |||||||
Total Reportable Segment and Other EBITDA | $ | 635 | $ | 81 | $ | 554 | |||||
EARNINGS | |||||||||||
Total Reportable Segment EBITDA and Other EBITDA | $ | 635 | $ | 81 | $ | 554 | |||||
Depreciation and Amortization | (86) | — | (86) | ||||||||
Interest Expense | (75) | — | (75) | ||||||||
Other Income and Expenses | 1 | — | 1 | ||||||||
Income Tax Expense | (4) | — | (4) | ||||||||
Total Net Income | 471 | 81 | 390 | ||||||||
Total Net Income - Noncontrolling Interests | (11) | — | (11) | ||||||||
Total Net Income - Controlling Interests | $ | 460 | $ | 81 | $ | 379 | |||||
(a) Primarily attributable to a gain as a result of the deconsolidation and re-measurement of Sabal Trail, partially offset | ||||||||||||
(b) Primarily merger-related severance costs. |
Spectra Energy Partners, LP Reported to Ongoing Earnings Reconciliation September 2017 Year-to-Date (Unaudited) (in millions) | |||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND | Reported | Less: | Ongoing | ||||||||
U.S. Transmission | $ | 1,548 | $ | 47 | (a) | $ | 1,501 | ||||
Liquids | 197 | (3) | (b) | 200 | |||||||
Total Reportable Segment EBITDA | 1,745 | 44 | 1,701 | ||||||||
Other | (92) | (38) | (b) | (54) | |||||||
Total Reportable Segment and Other EBITDA | $ | 1,653 | $ | 6 | $ | 1,647 | |||||
EARNINGS | |||||||||||
Total Reportable Segment EBITDA and Other EBITDA | $ | 1,653 | $ | 6 | $ | 1,647 | |||||
Depreciation and Amortization | (258) | — | (258) | ||||||||
Interest Expense | (191) | — | (191) | ||||||||
Other Income and Expenses | 2 | — | 2 | ||||||||
Income Tax Expense | (14) | — | (14) | ||||||||
Total Net Income | 1,192 | 6 | 1,186 | ||||||||
Total Net Income - Noncontrolling Interests | (87) | — | (87) | ||||||||
Total Net Income - Controlling Interests | $ | 1,105 | $ | 6 | $ | 1,099 |
(a) Primarily attributable to a gain as a result of the deconsolidation and re-measurement of Sabal Trail, partially offset by | |||||||||||||
(b) Primarily merger-related severance costs. |
View original content:http://www.prnewswire.com/news-releases/spectra-energy-partners-reports-third-quarter-2018-results-and-announces-quarterly-cash-distribution-increase-300742591.html
SOURCE Spectra Energy Partners, LP
DALLAS, Oct. 5, 2018 /PRNewswire/ -- Swank Capital, LLC and Cushing® Asset Management, LP announce today the upcoming rebalancing of The Cushing® MLP High Income Index (the "Index") as part of normal index operations. After the markets close on October 12, 2018, the 30 constituents of the Index will be rebalanced, and the following changes will become effective on October 15, 2018.
Cushing® MLP High Income Index constituents, effective October 15, 2018: | ||||
Company Name | Ticker | Tier | Index | Prior |
Golar LNG Partners LP | GMLP | 1 | 5.0% | 1 |
Buckeye Partners, L.P. | BPL | 1 | 5.0% | 1 |
NGL Energy Partners LP | NGL | 1 | 5.0% | 1 |
USA Compression Partners, LP | USAC | 1 | 5.0% | 1 |
Enbridge Energy Partners, L.P. | EEP | 1 | 5.0% | 1 |
Sunoco LP | SUN | 1 | 5.0% | 1 |
Alliance Resource Partners, L.P. | ARLP | 1 | 5.0% | 1 |
Energy Transfer Partners, L.P. | ETP | 1 | 5.0% | 1 |
SemGroup Corporation | SEMG | 1 | 5.0% | New |
Andeavor Logistics LP | ANDX | 1 | 5.0% | 1 |
Hi-Crush Partners LP | HCLP | 2 | 3.5% | 2 |
Summit Midstream Partners, LP | SMLP | 2 | 3.5% | 2 |
AmeriGas Partners, L.P. | APU | 2 | 3.5% | 2 |
Western Gas Partners, L.P. | WES | 2 | 3.5% | 2 |
GasLog Partners LP | GLOP | 2 | 3.5% | 3 |
Holly Energy Partners, L.P. | HEP | 2 | 3.5% | 3 |
EQT Midstream Partners, LP | EQM | 2 | 3.5% | 2 |
EnLink Midstream Partners, LP | ENLK | 2 | 3.5% | 1 |
Tallgrass Energy, LP | TGE | 2 | 3.5% | 3 |
Dominion Energy Midstream Partners, LP | DM | 2 | 3.5% | 2 |
Enable Midstream Partners, LP | ENBL | 3 | 1.5% | 2 |
DCP Midstream, LP | DCP | 3 | 1.5% | 2 |
Black Stone Minerals, L.P. | BSM | 3 | 1.5% | 3 |
Western Gas Equity Partners, LP | WGP | 3 | 1.5% | 3 |
MPLX LP | MPLX | 3 | 1.5% | 3 |
CNX Midstream Partners LP | CNXM | 3 | 1.5% | 3 |
Energy Transfer Equity, L.P. | ETE | 3 | 1.5% | 3 |
Shell Midstream Partners, L.P. | SHLX | 3 | 1.5% | New |
Crestwood Equity Partners LP | CEQP | 3 | 1.5% | 2 |
Targa Resources Corp. | TRGP | 3 | 1.5% | New |
Constituents removed, effective October 15, 2018: | |
Company Name | Ticker |
Spectra Energy Partners, LP | SEP |
Enterprise Products Partners, L.P. | EPD |
Martin Midstream Partners L.P. | MMLP |
ABOUT THE CUSHING® MLP HIGH INCOME INDEX
The Cushing® MLP High Income Index provides a benchmark that is designed to track the performance of 30 higher-yielding publicly traded midstream energy infrastructure companies, including master limited partnerships (MLPs) and non-MLP energy midstream corporations (each, a "Midstream Company" an collectively, "Midstream Companies"). Constituents are chosen according to a three-tiered proprietary weighting system developed by Cushing® Asset Management, LP. The Cushing® MLP High Income Index is calculated by S&P Dow Jones Indices and reported on a real-time basis under the Bloomberg ticker "MLPY".
ABOUT SWANK CAPITAL AND CUSHING® ASSET MANAGEMENT
Cushing® Asset Management, LP ("Cushing"), a subsidiary of Swank Capital, LLC, is an SEC-registered investment adviser headquartered in Dallas, Texas. Cushing serves as investment adviser to affiliated funds and managed accounts which invest primarily in securities of Midstream Companies and other natural resource companies.
Cushing is also dedicated to serving the needs of MLP and energy income investors by sponsoring a variety of industry benchmarks, including The Cushing® 30 MLP Index (Bloomberg Ticker: MLPX), The Cushing® MLP Market Cap Index (Bloomberg Ticker: CMCI), The Cushing® Energy Index (Bloomberg Ticker: CENI), The Cushing® Energy Supply Chain Index (Bloomberg Ticker: CSCI), The Cushing® Transportation Index (Bloomberg Ticker: CTRI) and The Cushing® Utility Index (Bloomberg Ticker: CUTI). For more information, please visit http://www.cushingasset.com/indices.
For additional information contact:
Judson Redmond
214-692-6334
http://www.cushingasset.com
The Cushing® MLP High Income Index (the "Index") is the exclusive property of Swank Capital, LLC, and Cushing® Asset Management, LP, which have contracted with S&P Opco, LLC (a subsidiary of S&P Dow Jones Indices LLC) ("S&P Dow Jones Indices") to maintain and calculate the Index. S&P® is a registered trademark of Standard & Poor's Financial Services LLC ("SPFS"); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC ("Dow Jones"); and these trademarks have been licensed to S&P Dow Jones Indices. "Calculated by S&P Dow Jones Indices" and its related stylized mark(s) have been licensed for use by Cushing® Asset Management, LP. Neither S&P Dow Jones Indices, SPFS, Dow Jones S&P nor any of their affiliates sponsor and promote the Index and none shall be liable for any errors or omissions in calculating the Index.
CUSH-MLPY
View original content:http://www.prnewswire.com/news-releases/swank-capital-and-cushing-asset-management-announce-rebalancing-of-the-cushing-mlp-high-income-index-300725007.html
SOURCE Cushing® Asset Management, LP; Swank Capital, LLC
CALGARY and HOUSTON, TX, Aug. 24, 2018 /PRNewswire/ - Enbridge Inc. (TSX: ENB) (NYSE: ENB) (Enbridge) on behalf of itself and certain of its wholly owned US subsidiaries and Spectra Energy Partners, LP (NYSE:SEP) (SEP) today announced that they have entered into a definitive agreement ("Agreement") under which Enbridge will acquire all of the outstanding public common units of SEP on the basis of 1.111 common shares of Enbridge for each common unit of SEP ("Agreed Exchange Ratio"). The Agreed Exchange Ratio represents a 9.8% increase to the exchange ratio offered by Enbridge on May 17, 2018 of 1.0123 Enbridge common shares per SEP common unit. The transaction is valued at US $3.3 billion / CAN $4.3 billion based on the closing price of Enbridge's common shares on the New York Stock Exchange (NYSE) / Toronto Stock Exchange (TSX) on August 23, 2018.
Benefits and Considerations for SEP Unitholders
Significant weakening of the US Master Limited Partnership (MLP) capital markets has adversely affected the growth opportunities for MLPs, including SEP. MLPs are dependent on consistent access to the capital markets at a reasonable cost of capital to grow their distributions. If SEP were to continue as a stand-alone entity in such an environment, it would be required to transition to a self-funding model using internally generated cash flow. SEP's priority would be to strengthen its balance sheet thereby limiting future distribution growth.
This transaction offers SEP public unitholders a superior investment proposition in Enbridge common shares, including:
The transaction also provides SEP unitholders an attractive value reflecting, among other factors, the July 18, 2018 FERC Order on Rehearing, which clarified its revised policy on the treatment of income taxes for MLPs. The clarification could potentially improve SEP's position relative to its cost of service assets given the magnitude of SEP's historical deferred income tax balances, and is therefore uniquely positive for SEP among the Enbridge family of sponsored vehicles.
The transaction premium is attractive particularly in light of SEP's limited future capacity for distribution growth. Also, for SEP unitholders, the value received removes uncertainty overhang created by the FERC policy announcements.
Benefits and Considerations for Enbridge Shareholders
The buy-in of SEP is strategically and economically attractive to current and future Enbridge shareholders and provides substantial benefits, including:
Other Information
As a result of the merger, Enbridge would acquire all of the 81.9 million public outstanding common units of SEP at a fixed exchange ratio of 1.111 common shares of Enbridge for each common unit of SEP. In aggregate, based on the Agreed Exchange Ratio, Enbridge would issue an estimated 91.0 million Enbridge common shares in connection with the transaction, representing approximately 5 percent of the total number of Enbridge common shares outstanding.
A more detailed description of the Agreement will be set forth in Enbridge's Current Report on Form 8-K that it expects to file with the Securities and Exchange Commission (the SEC) on August 24, 2018.
The transaction has been approved by the board of directors of Enbridge and certain of its wholly owned US subsidiaries. The board of directors of the general partner of SEP (SEP Board) delegated to a conflicts committee consisting solely of independent directors (SEP Conflicts Committee) the authority to review, evaluate and negotiate the transaction on behalf of SEP. The SEP Conflicts Committee unanimously approved the transaction and recommended approval of the transaction to the SEP Board. The transaction has been approved by the SEP Board based on that recommendation. Pursuant to the Agreement, Enbridge has irrevocably and unconditionally agreed to deliver its consent, with respect to all of the SEP common units owned by its wholly-owned subsidiaries, in favor of approval of the transaction. As the majority SEP unitholder (83% of total SEP common units outstanding), Enbridge's approval by consent will constitute the requisite SEP unitholder vote required to approve the transaction.
Closing of the transaction is expected to occur in the fourth quarter of 2018 and will be subject to customary closing conditions. If the transaction does not close before the record date for SEP's distribution to be paid in the fourth quarter of 2018, and subject to SEP Board approval, SEP is expected to pay a cash distribution to its unitholders in the fourth quarter consistent with previously disclosed distribution guidance. Based on an expected fourth quarter closing date for the transaction, a SEP unitholder will receive either a SEP cash distribution or an Enbridge cash dividend.
After being filed, SEP unitholders will be able to obtain a copy of the consent solicitation statement/prospectus related to the transaction, as well as other filings containing information about the proposed transaction, without charge, at the SEC's internet site (http://www.sec.gov).
BofA Merrill Lynch and Scotiabank are acting as financial advisors to Enbridge. McCarthy Tetrault LLP, Sullivan & Cromwell LLP and Vinson & Elkins LLP are acting as Canadian, U.S. legal and tax advisors, respectively, to Enbridge.
Jefferies LLC acted as financial advisor to the SEP Conflicts Committee, while Sidley Austin LLP acted as legal advisor to the SEP Conflicts Committee.
FORWARD-LOOKING INFORMATION
This communication 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. Forward‑looking statements are based on Enbridge's and SEP's respective beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast and similar expressions and include, but are not limited to, statements regarding the expected closing, consummation, completion, timing and benefits of the proposed merger of SEP and Autumn Acquisition Sub, LLC, a Delaware limited liability company and a wholly‑owned subsidiary of Enbridge (the "Proposed Merger"), the expected synergies and shareholder value to result from the combined company, the expected levels of cash distributions by SEP with respect to its common units, the expected levels of dividends by Enbridge to its shareholders, the expected financial results of Enbridge, SEP and their affiliates, future credit ratings, financial condition and business strategy of Enbridge, SEP and their affiliates.
Although SEP and Enbridge believe these forward-looking statements are reasonable based on the information available on the date such statements are made and processes used to prepare the information, such statements are not guarantees of future performance and readers are cautioned against placing undue reliance on forward-looking statements. By their nature, these statements involve a variety of assumptions, known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such statements. Material assumptions include assumptions about the following: the expected supply of and demand for crude oil, natural gas, natural gas liquids ("NGL") and renewable energy; prices of crude oil, natural gas, NGL and renewable energy; exchange rates; inflation; interest rates; availability and price of labor and construction materials; operational reliability; customer and regulatory approvals; maintenance of support and regulatory approvals for projects; anticipated in-service dates; weather; the timing and closing of dispositions; the realization of anticipated benefits and synergies of the Proposed Merger; governmental legislation; acquisitions and the timing thereof; the success of integration plans; impact of capital project execution on future cash flows; credit ratings; capital project funding; expected earnings; expected future cash flows; and estimated future dividends. Assumptions regarding the expected supply of and demand for crude oil, natural gas, NGL and renewable energy, and the prices of these commodities, are material to and underlie all forward-looking statements, as they may impact current and future levels of demand for SEP's and Enbridge's services. Similarly, exchange rates, inflation and interest rates impact the economies and business environments and may impact levels of demand for SEP's and Enbridge's services and cost of inputs, and are therefore inherent in all forward‑looking statements. Due to the interdependencies and correlation of these macroeconomic factors, the impact of any one assumption on a forward-looking statement cannot be determined with certainty, particularly with respect to the impact of the Proposed Merger, expected earnings and cash flow or estimated future dividends. The most relevant assumptions associated with forward-looking statements on announced projects and projects under construction, including estimated completion dates and expected capital expenditures, include the following: the availability and price of labor and construction materials; the effects of inflation and foreign exchange rates on labor and material costs; the effects of interest rates on borrowing costs; the impact of weather and customer, government and regulatory approvals on construction and in-service schedules and cost recovery regimes.
Forward‑looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward‑looking statement include, but are not limited to: the risk that the Proposed Merger does not occur; negative effects from the pendency of the Proposed Merger; the ability to realize expected cost savings and benefits; the timing to consummate the Proposed Merger; whether SEP will produce sufficient cash flows to provide the level of cash distributions SEP expects with respect to its common units; whether Enbridge will produce sufficient cash flows to provide the level of dividends Enbridge expects with respect to its common shares; outcomes of litigation and regulatory investigations, proceedings or inquiries; operating performance of SEP and Enbridge; regulatory parameters regarding SEP and Enbridge; other Enbridge dispositions; the proposed simplification of Enbridge's corporate structure; project approval and support; renewals of rights of way; weather, economic and competitive conditions; public opinion; changes in tax laws and tax rates; changes in trade agreements, exchange rates, interest rates, commodity prices, political decisions and supply of and demand for commodities; and any other risks and uncertainties discussed herein or in Enbridge's and SEP's other filings with Canadian and United States securities regulators. Except to the extent required by applicable law, Enbridge and SEP assume no obligation to publicly update or revise any forward‑looking statements made in this news release or otherwise, whether as a result of new information, future events or otherwise. All subsequent forward-looking statements, whether written or oral, attributable to Enbridge, SEP or persons acting on their behalf, are expressly qualified in their entirety by these cautionary statements. These factors, as well as additional factors that could affect Enbridge's or SEP's respective forward‑looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward‑Looking Information" in Enbridge's 2017 Form 10‑K, filed with the U.S. Securities and Exchange Commission ("SEC") and Canadian securities regulators on February 16, 2018, SEP's 2017 Form 10‑K, filed with the SEC on February 16, 2018, and in Enbridge's and SEP's respective other filings made with the SEC and Canadian securities regulators, which are available via the SEC's website at www.sec.gov and at www.sedar.com, as applicable. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than Enbridge or SEP has described. All forward-looking statements in this release are made as of the date hereof and neither Enbridge nor SEP undertakes any obligation to publicly update or revise any forward-looking statements in this release, whether as a result of new information, future events or otherwise.
IMPORTANT NOTICE TO INVESTORS
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any consent or approval. The proposed merger between Enbridge and SEP will be submitted to the unitholders of SEP for their consideration. Enbridge will file with the SEC a consent solicitation statement of SEP that also constitutes a prospectus of Enbridge. Enbridge and SEP also plan to file other documents with the SEC regarding the proposed merger. INVESTORS AND SECURITY HOLDERS OF ENBRIDGE AND SEP ARE URGED TO READ THE CONSENT SOLICITATION STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS THAT WILL BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE MERGER. Investors and unitholders will be able to obtain free copies of the consent solicitation statement/prospectus and other documents containing important information about Enbridge and SEP once such documents are filed with the SEC, through the website maintained by the SEC at http://www.sec.gov. Copies of the consent solicitation statement/prospectus and the filings with the SEC that will be incorporated by reference in the consent solicitation statement/prospectus can also be obtained, without charge, by directing a request either to Enbridge Inc., 200, 425 – 1st Street S.W., Calgary, Alberta, Canada T2P 3L8, Attention: Investor Relations or to Spectra Energy Partners, LP, 5400 Westheimer Court, Houston, Texas 77056, Attention: Investor Relations.
Participants in the Solicitation
Enbridge, and certain of its directors and executive officers, SEP, and certain of the directors and executive officers of GP, LLC, which manages the business and affairs of SEP, may be deemed participants in the solicitation of consent from the holders of SEP Common Units in connection with the Merger. Information about the directors and executive officers of Enbridge is set forth in its definitive proxy statement filed with the SEC on April 5, 2018. Information about the directors and executive officers of GP, LLC is set forth in SEP's Annual Report on Form 10-K for the fiscal year ended December 31, 2017, which was filed with the SEC on February 16, 2018. These documents can be obtained free of charge from the sources indicated above. Other information regarding the participants in the consent solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the consent solicitation statement/prospectus and other relevant materials to be filed with the SEC when they become available.
About Enbridge Inc.
Enbridge Inc. (the Company) is North America's premier energy infrastructure company with strategic business platforms that include an extensive network of crude oil, liquids and natural gas pipelines, regulated natural gas distribution utilities and renewable power generation. The Company safely delivers an average of 2.9 million barrels of crude oil each day through its Mainline and Express Pipeline; accounts for approximately 65% of U.S.-bound Canadian crude oil exports; and moves approximately 20% of all natural gas consumed in the U.S., serving key supply basins and demand markets. The Company's regulated utilities serve approximately 3.7 million retail customers in Ontario, Quebec, and New Brunswick. Enbridge also has interests in more than 2,500 MW of net renewable generating capacity in North America and Europe. The Company has ranked on the Global 100 Most Sustainable Corporations index for the past nine years; its common shares trade on the Toronto and New York stock exchanges under the symbol ENB.
Life takes energy and Enbridge exists to fuel people's quality of life. For more information, visit www.enbridge.com.
About Spectra Energy Partners
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include approximately 16,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York Stock Exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media:
Michael Barnes
Toll Free: (888) 992-0997
Email: media@enbridge.com
Investment Community:
Enbridge Inc.
Jonathan Gould
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
Spectra Energy Partners, LP
Roni Cappadonna
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
View original content:http://www.prnewswire.com/news-releases/enbridge-announces-definitive-agreement-to-acquire-all-public-equity-of-spectra-energy-partners-advances-corporate-structure-simplification-300701990.html
SOURCE Enbridge Inc.
DALLAS, Aug. 1, 2018 /PRNewswire/ -- Alerian reported index linked product positions of $15.0 billion as of June 30, 2018. Linked products include exchange-traded funds, exchange-traded notes, return of capital notes, variable insurance portfolios, and mutual funds.
Below is a full list of energy master limited partnership (MLP) positions, as of June 30, 2018, in products linked to the Alerian Index Series.
Ticker |
Exposure in |
Exposure in |
Ticker |
Exposure in |
Exposure in | |
AM |
305,257,484 |
10,340,701 |
HEP |
151,911,915 |
5,375,510 | |
AMGP |
1,164,270 |
61,732 |
MMP |
1,501,453,809 |
21,735,000 | |
ANDX |
446,822,576 |
10,506,056 |
MPLX |
1,162,174,520 |
34,041,433 | |
APU |
58,778,057 |
1,392,185 |
NBLX |
22,166,701 |
434,130 | |
ARLP |
25,591,033 |
1,394,607 |
NGL |
165,162,738 |
13,213,019 | |
BPL |
604,497,037 |
17,197,640 |
NS |
210,933,016 |
9,312,716 | |
BPMP |
20,189,424 |
961,859 |
NSH |
239,822 |
19,340 | |
BWP |
170,678,160 |
14,688,310 |
PAA |
1,177,071,579 |
49,791,522 | |
CEQP |
183,499,246 |
5,779,504 |
PAGP |
3,213,393 |
134,395 | |
CQP |
173,601,824 |
4,828,980 |
PSXP |
318,554,875 |
6,238,834 | |
CVRR |
20,028,626 |
896,135 |
RMP |
147,346,450 |
8,657,253 | |
DCP |
421,401,442 |
10,654,904 |
SEP |
341,382,494 |
9,638,128 | |
DM |
13,475,016 |
990,810 |
SHLX |
322,823,077 |
14,554,692 | |
EEP |
277,227,481 |
25,363,905 |
SMLP |
12,744,536 |
827,567 | |
ENBL |
176,973,526 |
10,343,280 |
SPH |
28,830,596 |
1,227,356 | |
ENLC |
853,859 |
51,906 |
SUN |
27,065,571 |
1,084,358 | |
ENLK |
303,905,691 |
19,568,943 |
TCP |
165,868,659 |
6,391,856 | |
EPD |
1,503,782,388 |
54,347,032 |
TEGP |
386,005,955 |
17,419,041 | |
EQGP |
355,540 |
15,123 |
TGP |
18,444,324 |
1,094,619 | |
EQM |
356,373,011 |
6,907,792 |
USAC |
16,751,289 |
995,323 | |
ETE |
6,023,303 |
349,177 |
VLP |
17,131,051 |
449,988 | |
ETP |
1,481,856,983 |
77,828,623 |
VNOM |
25,953,041 |
813,320 | |
GEL |
281,851,288 |
12,864,048 |
WES |
571,788,034 |
11,816,244 | |
GLOP |
14,609,467 |
612,556 |
WGP |
826,761 |
23,126 | |
GMLP |
15,169,006 |
981,178 |
WPZ |
1,218,967,796 |
30,031,234 | |
HCLP |
18,789,000 |
1,592,288 |
||||
About Alerian
Alerian equips investors to make informed decisions about energy infrastructure and Master Limited Partnerships (MLPs). Its benchmarks are widely used by industry executives, investment professionals, research analysts, and national media to analyze relative performance. As of June 30, 2018, over $15 billion is directly tied to the Alerian Index Series through exchange-traded funds and notes, separately managed accounts, and structured products. For more information, including index values and constituents, research content, and announcements regarding rebalancings, please visit alerian.com.
View original content:http://www.prnewswire.com/news-releases/alerian-reports-june-30-2018-index-linked-product-positions-300690263.html
SOURCE Alerian
CALGARY, July 12, 2018 /PRNewswire/ - Enbridge Inc. (TSX, NYSE: ENB) (Enbridge) will host a joint conference call and webcast with Enbridge Income Fund Holdings Inc. (TSX: ENF), Enbridge Energy Partners, L.P. (NYSE: EEP) and Spectra Energy Partners, LP (NYSE: SEP) to provide an enterprise-wide business update and review 2018 second quarter results on August 3, 2018 at 7:00 a.m. MT (9:00 a.m. ET).
Enbridge and Enbridge Income Fund Holdings Inc. will announce second quarter results before markets open on August 3, 2018, while Enbridge Energy Partners, L.P. and Spectra Energy Partners, LP will announce second quarter results after markets close on August 2, 2018.
2018 Second Quarter Earnings Webcast and Conference Call
When: |
Friday, August 3, 2018 |
7:00 a.m. MT (9:00 a.m. ET) | |
Webcast: |
|
Call: |
Dial-in # (Audio only – please dial in 10 minutes ahead): |
North America Toll Free: 1 (877) 930-8043 | |
Outside North America: 1 (253) 336-7522 | |
Participant Passcode: 5369238 |
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 company websites within approximately 24 hours after the event.
Replay: |
Audio Replay # (Available for 7 days after call): |
North America Toll Free: 1 (855) 859-2056 | |
Outside North America: 1 (404) 537-3406 | |
Replay Passcode: 5369238 |
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 Advisory
The conference call will cover each of Enbridge Inc., Enbridge Income Fund Holdings Inc., Enbridge Energy Partners, L.P. and Spectra Energy Partners, LP's (collectively, the Entities) most recent financial results and may contain forward-looking statements. When used in the call, words such as "anticipate", "expect", "project", and similar expressions are intended to identify such forward-looking statements. Although each of the Entities believes that its respective statements are or will be based on information and assumptions which are current, reasonable and complete, these statements are necessarily subject to a variety of risks and uncertainties pertaining to operating performance, regulatory parameters, economic conditions, commodity prices and other matters. You can find a discussion of those assumptions, risks and uncertainties in the Canadian securities law and/or American SEC filings for the applicable Entity. While each Entity makes its respective forward-looking statements in good faith, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. Except as may be required by applicable securities laws, no Entity assumes any obligation to publicly update or revise any forward-looking statements made herein, on the call or otherwise, whether as a result of new information, future events or otherwise.
About Enbridge Inc.
Enbridge Inc. is North America's premier energy infrastructure company with strategic business platforms that include an extensive network of crude oil, liquids and natural gas pipelines, regulated natural gas distribution utilities and renewable power generation. The Company safely delivers an average of 2.8 million barrels of crude oil each day through its Mainline and Express Pipeline; accounts for approximately 65% of U.S.-bound Canadian crude oil exports; and moves approximately 20% of all natural gas consumed in the U.S., serving key supply basins and demand markets. The Company's regulated utilities serve approximately 3.7 million retail customers in Ontario, Quebec, and New Brunswick. Enbridge also has interests in more than 2,500 MW of net renewable generating capacity in North America and Europe. The Company has ranked on the Global 100 Most Sustainable Corporations index for the past nine years; its common shares trade on the Toronto and New York stock exchanges under the symbol ENB.
Life takes energy and Enbridge exists to fuel people's quality of life. For more information, visit www.enbridge.com.
About Enbridge Income Fund Holdings Inc.
Enbridge Income Fund Holdings Inc. is a publicly traded corporation. The Company, through its investment in Enbridge Income Fund indirectly holds high quality, low-risk energy infrastructure assets. The Fund's assets consist of a portfolio of Canadian liquids transportation and storage businesses, including the Canadian Mainline, the Regional Oil Sands System, the Canadian segment of the Southern Lights Pipeline, Class A units entitling the holder to receive defined cash flows from the US segment of the Southern Lights Pipeline, and a 50 percent interest in the Alliance Pipeline, which transports natural gas from Canada to the U.S., and interests in more than 1,400 MW of renewable and alternative power generation assets. Enbridge Income Fund Holdings Inc. trades on the Toronto Stock Exchange under the symbol ENF; information about the Company is available on the Company's website www.enbridgeincomefund.com.
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 Spectra Energy Partners, LP
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 16,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York Stock Exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media:
Jesse Semko
Toll Free: (888) 992-0997
Email: media@enbridge.com
Investment Community:
Enbridge Inc.
Jonathan Gould
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
Enbridge Income Fund Holdings Inc.
Nafeesa Kassam
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
Spectra Energy Partners, LP & Enbridge Energy Partners, L.P.
Roni Cappadonna
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
SOURCE Enbridge Inc.
DALLAS, June 8, 2018 /PRNewswire/ -- Swank Capital, LLC and Cushing® Asset Management, LP, announce today an upcoming interim rebalancing of The Cushing® Energy Index (the "Index"). Per the Index's methodology guide, the removal of an Index constituent from a Sub-Index without a named direct replacement necessitates the rebalancing of the Index. The Cushing® 30 MLP Index (the "Sub-Index") announced today that Index constituents Spectra Energy Partners, LP (NYSE: SEP) and Tallgrass Energy GP, LP (NYSE: TEGP) will be removed from the Sub-Index after the markets close on June 15, 2018, and effective on June 18, 2018. Replacements named for the removed constituents are not direct replacements. After the markets close on June 15, 2018, the constituents of the Index will be rebalanced, and the changes in the table below will become effective on June 18, 2018.
Cushing® Energy Index constituents, effective June 18, 2018:
Company Name |
Ticker |
Index Weight |
Status |
The Williams Companies, Inc. |
WMB |
6.00% |
Existing |
Kinder Morgan, Inc. |
KMI |
6.00% |
Existing |
ONEOK, Inc. |
OKE |
6.00% |
Existing |
Helmerich & Payne, Inc. |
HP |
5.78% |
Existing |
Exxon Mobil Corporation |
XOM |
5.22% |
Existing |
Chevron Corporation |
CVX |
4.74% |
Existing |
Occidental Petroleum Corporation |
OXY |
4.65% |
Existing |
Schlumberger N.V. (Schlumberger Limited) |
SLB |
3.79% |
Existing |
Phillips 66 |
PSX |
3.58% |
Existing |
Valero Energy Corporation |
VLO |
3.45% |
Existing |
Apache Corporation |
APA |
3.30% |
Existing |
Marathon Petroleum Corporation |
MPC |
3.05% |
Existing |
Baker Hughes, A GE Company |
BHGE |
2.72% |
Existing |
ConocoPhillips |
COP |
2.19% |
Existing |
Andeavor |
ANDV |
2.14% |
Existing |
TechnicFMC plc |
FTI |
2.13% |
Existing |
Hess Corporation |
HES |
2.12% |
Existing |
Dominion Energy Midstream Partners, LP |
DM |
2.00% |
NEW |
Alliance Resource Partners, L.P. |
ARLP |
2.00% |
Existing |
Andeavor Logistics LP |
ANDX |
2.00% |
Existing |
Tallgrass Energy Partners, LP |
TEP |
2.00% |
Existing |
EnLink Midstream Partners, LP |
ENLK |
2.00% |
Existing |
DCP Midstream, LP |
DCP |
2.00% |
Existing |
Enable Midstream Partners, LP |
ENBL |
2.00% |
NEW |
EQT Midstream Partners, LP |
EQM |
2.00% |
NEW |
Western Gas Partners, L.P. |
WES |
2.00% |
Existing |
Crestwood Equity Partners LP |
CEQP |
2.00% |
NEW |
Energy Transfer Equity, L.P. |
ETE |
2.00% |
Existing |
Energy Transfer Partners, L.P. |
ETP |
2.00% |
NEW |
Halliburton Company |
HAL |
1.95% |
Existing |
Anadarko Petroleum Corporation |
APC |
1.88% |
Existing |
Noble Energy, Inc. |
NBL |
1.67% |
Existing |
Cabot Oil & Gas Corporation |
COG |
1.37% |
Existing |
Marathon Oil Corporation |
MRO |
1.26% |
Existing |
Devon Energy Corporation |
DVN |
1.01% |
Existing |
Constituents removed, effective June 18, 2018:
Company Name |
Ticker |
MPLX LP |
MPLX |
Spectra Energy Partners, LP |
SEP |
Sunoco LP |
SUN |
Tallgrass Energy GP, LP |
TEGP |
Williams Partners L.P. |
WPZ |
ABOUT THE CUSHING® ENERGY INDEX
The Cushing® Energy Index tracks the performance of widely held companies engaged in exploration and production, refining and marketing, and storage and transportation of oil, natural gas, coal and consumable fuels, as well as oil and natural gas equipment and services companies. Constituents of the Index are weighted based on current yield. The Index price level is calculated by S&P Dow Jones Indices and reported on a real-time basis under the Bloomberg ticker "CENI".
ABOUT SWANK CAPITAL AND CUSHING® ASSET MANAGEMENT
Cushing® Asset Management, LP ("Cushing"), a subsidiary of Swank Capital, LLC, is an SEC-registered investment adviser headquartered in Dallas, Texas. Cushing serves as investment adviser to affiliated funds and managed accounts which invest primarily in securities of MLPs and other natural resource companies.
Cushing is also dedicated to serving the needs of investors by sponsoring a variety of benchmarks, including The Cushing® 30 MLP Index (Bloomberg Ticker: MLPX), The Cushing® 30 MLP Market Cap Index (Bloomberg Ticker: CMCI), The Cushing® MLP High Income Index (Bloomberg Ticker: MLPY), The Cushing® Energy Supply Chain Index (Bloomberg Ticker: CSCI), The Cushing® Transportation Index (Bloomberg Ticker: CTRI) and The Cushing® Utility Index (Bloomberg Ticker: CUTI). For more information, please visit http://www.cushingasset.com/indices.
Contact:
Judson Redmond
214-692-6334
www.cushingasset.com
The Cushing® Energy Index (the "Index") is the exclusive property of Swank Capital, LLC, and Cushing Asset Management, LP, which have contracted with S&P Opco, LLC (a subsidiary of S&P Dow Jones Indices LLC) ("S&P Dow Jones Indices") to calculate and maintain the Index. S&P® is a registered trademark of Standard & Poor's Financial Services LLC ("SPFS"); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC ("Dow Jones"); and, these trademarks have been licensed to S&P Dow Jones Indices. "Calculated by S&P Dow Jones Indices" and its related stylized mark(s) have been licensed for use by Swank Capital, LLC, and Cushing Asset Management, LP. Neither S&P Dow Jones Indices, SPFS, Dow Jones nor any of their affiliates sponsor and promote the Index and none shall be liable for any errors or omissions in calculating the Index.
CUSH-CENI
View original content:http://www.prnewswire.com/news-releases/swank-capital-and-cushing-asset-management-announce-rebalancing-of-the-cushing-energy-index-300662241.html
SOURCE Cushing Asset Management, LP; Swank Capital, LLC
HOUSTON, May 18, 2018 /PRNewswire/ - Spectra Energy Partners, LP (NYSE: SEP) today announced that it has received a non-binding offer from Enbridge Inc. (Enbridge) (TSX, NYSE: ENB) and Enbridge (U.S.) Inc. to acquire all of the outstanding equity securities of SEP not currently beneficially owned by Enbridge.
The board of directors of the general partner of the general partner of Spectra Energy Partners, LP (the SEP Board) has established a conflicts committee of independent directors to review and consider the proposal.
The proposed transaction is subject to the review and favorable recommendation and approval by the conflicts committee of the SEP Board, final approvals by the SEP Board and the boards of directors of Enbridge and Enbridge (U.S.) Inc., and the negotiation of a definitive agreement. Any definitive agreement is expected to contain customary closing conditions. There can be no assurance that any agreement will be reached or that a transaction will be consummated.
Unitholders of SEP do not need to take any action with respect to the proposal at this time.
FORWARD-LOOKING INFORMATION
This communication includes certain forward looking statements and information (FLI) to provide SEP unitholders and potential investors with information about SEP and its subsidiaries and affiliates. FLI is typically identified by words such as "anticipate", "expect", "project", "estimate", "forecast", "plan", "intend", "target", "believe", "likely" and similar words suggesting future outcomes or statements regarding an outlook. All statements other than statements of historical fact may be FLI. In particular, this news release contains FLI pertaining to, but not limited to, information with respect to a proposed transaction between SEP and Enbridge.
Although we believe that the FLI is reasonable based on the information available today and processes used to prepare it, such statements are not guarantees of future performance and you are cautioned against placing undue reliance on FLI. By its nature, FLI involves a variety of assumptions, which are based upon factors that may be difficult to predict and that may involve known and unknown risks and uncertainties and other factors which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by these FLI, including, but not limited to, the following: the negotiation and execution, and the terms and conditions, of a definitive agreement relating to the proposed transaction and the ability of Enbridge or SEP to enter into or consummate such agreement; the risk that the proposed merger does not occur; negative effects from the pendency of the proposed merger; failure to obtain the required vote of SEP's unitholders or board support; the timing to consummate the proposed transaction; the focus of management time and attention on the proposed transaction and other disruptions arising from the proposed transaction; potential changes in the Enbridge share price which may negatively impact the value of consideration offered to SEP unitholders; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; expected exchange rates; inflation; interest rates; tax rates and changes; completion of growth projects; anticipated in-service dates; capital project funding; success of hedging activities; the ability of management of SEP, its subsidiaries and affiliates to execute key priorities, including those in connection with the proposed transaction; customer, shareholder, regulatory and other stakeholder approvals and support; and regulatory and legislative decisions and actions. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2017 Form 10-K, filed on February 16, 2018, and in our subsequent filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
IMPORTANT NOTICE TO INVESTORS
This press release is not a solicitation of a proxy, an offer to purchase nor a solicitation of an offer to sell common units of SEP, and it is not a substitute for any proxy statement or other filings that may be made with the Securities and Exchange Commission (SEC) should these proposed transactions go forward. If such documents are filed with the SEC, investors will be urged to thoroughly review and consider them because they will contain important information, including risk factors. Any such documents, once filed, will be available free of charge at the SEC's website (www.sec.gov) and from Enbridge and SEP, as applicable.
Spectra Energy Partners
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 16,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York Stock Exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media: |
Michael Barnes | |
Toll Free: (888) 992-0997 | ||
Analysts and Investors: |
Roni Cappadonna | |
Toll Free: (800) 481-2804 | ||
View original content:http://www.prnewswire.com/news-releases/spectra-energy-partners-lp-acknowledges-enbridge-inc-offer-and-establishes-a-conflicts-committee-300650838.html
SOURCE Spectra Energy Partners, LP
HOUSTON, April 30, 2018 /PRNewswire/ - Sabal Trail Transmission, LLC ("Sabal Trail") announced today the closing of its $1.5 billion offering (the "Offering") of senior notes.
Sabal Trail is a joint venture comprised of Spectra Energy Partners, LP (NYSE: SEP) owning 50%, NextEra Energy, Inc. owning 42.5% and Duke Energy owning 7.5% (collectively the "Owners"). Sabal Trail is an approximately 517-mile interstate natural gas pipeline that will have the capacity to deliver approximately 1.1 billion cubic feet per day to the Southeast U.S., including firm transportation to meet the power generation needs of Florida Power & Light and Duke Energy of Florida, once approved future compression expansions occur.
The notes were issued in three tranches as follows (collectively, the "Notes"): $500 million principal amount of 4.246% senior notes due 2028, $600 million principal amount of 4.682% senior notes due 2038, and $400 million principal amount of 4.832% senior notes due 2048.
Sabal Trail intends to use the net proceeds from the Offering to make proportional distributions to the Owners with respect to construction and development costs previously incurred by the Owners.
The Notes were offered and sold only to qualified institutional buyers in accordance with the exemption from registration provided by Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"). The Notes have not been registered under the Securities Act or applicable state securities laws. The Notes may not be offered or sold in the United States absent registration or an applicable exemption from such registration requirements.
This press release is for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy the Notes described in this press release, nor shall there be any sale of the Notes in any state or jurisdiction in which such an offer, sale or solicitation would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction.
For more information on Sabal Trail, visit www.sabaltrail.com.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2017 Form 10-K, filed on February 15, 2018, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 16,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York Stock Exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
NextEra Energy
NextEra Energy, Inc. (NYSE: NEE) is a leading clean energy company with consolidated revenues of approximately $17.2 billion, operates approximately 46,790 megawatts of net generating capacity and employs approximately 14,000 people in 33 states and Canada as of year-end 2017. Headquartered in Juno Beach, Florida, NextEra Energy's principal subsidiaries are Florida Power & Light Company, which serves approximately 5 million customer accounts in Florida and is one of the largest rate-regulated electric utilities in the United States, and NextEra Energy Resources, LLC, which, together with its affiliated entities, is the world's largest operator of renewable energy from the wind and sun. Through its subsidiaries, NextEra Energy generates clean, emissions-free electricity from eight commercial nuclear power units in Florida, New Hampshire, Iowa and Wisconsin. A Fortune 200 company and included in the S&P 100 index, NextEra Energy has been recognized often by third parties for its efforts in sustainability, corporate responsibility, ethics and compliance, and diversity, and has been ranked No. 1 in the electric and gas utilities industry in Fortune's 2018 list of "World's Most Admired Companies." For more information about NextEra Energy companies, visit these websites: www.NextEraEnergy.com, www.FPL.com, www.NextEraEnergyResources.com.
Duke Energy
Headquartered in Charlotte, N.C., Duke Energy is one of the largest energy holding companies in the United States. Its Electric Utilities and Infrastructure business unit serves approximately 7.5 million customers located in six states in the Southeast and Midwest. The company's Gas Utilities and Infrastructure business unit distributes natural gas to approximately 1.6 million customers in the Carolinas, Ohio, Kentucky and Tennessee. Its Commercial Renewables business unit operates a growing renewable energy portfolio across the United States.
Duke Energy is a Fortune 125 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available at duke-energy.com.
The Duke Energy News Center serves as a multimedia resource for journalists and features news releases, helpful links, photos and videos. Hosted by Duke Energy, illumination is an online destination for stories about people, innovations, and community and environmental topics. It also offers glimpses into the past and insights into the future of energy.
Follow Duke Energy on Twitter, LinkedIn, Instagram and Facebook.
Media:
Andrea Grover
(888) 215-6683 (Sabal Trail media line)
andrea.grover@enbridge.com
Analysts & Investors:
Roni Cappadonna
(713) 627-4778
investor.relations@enbridge.com
View original content:http://www.prnewswire.com/news-releases/sabal-trail-transmission-llc-announces-pricing-of-1-5-billion-debt-offering-300639201.html
SOURCE Spectra Energy Partners, LP
HOUSTON, March 16, 2018 /PRNewswire/ - Spectra Energy Partners, LP (NYSE: SEP) today provided its preliminary assessment of the potential impacts of the Federal Energy Regulatory Commission's (FERC) recent policy change with respect to the recovery of income tax amounts included in the cost of service pipelines within a master limited partnership (MLP).
On March 15, 2018, FERC changed its long-standing policy on the treatment of income tax amounts included in the rates of pipelines and other entities subject to cost of service rate regulation within an MLP. In its order PL17-1-000, FERC revised a policy in place since 2005 to no longer permit entities organized as master limited partnerships to recover an income tax allowance in their cost of service rates. SEP intends to ask for rehearing of this policy change at FERC.
Roughly 60% of SEP's gas pipeline revenue comes from negotiated or market-based tariffs and therefore not directly affected by the FERC policy revisions. The remaining 40% of gas pipeline revenue is derived from cost of service based tariffs which could be subject to tax recovery disallowance. The liquids assets within SEP are predominantly negotiated tariffs and also not materially affected by the policy revisions.
SEP anticipates no immediate impact to its current gas pipeline cost of service rates as a result of the revised policy and therefore no impact is expected to its previously provided 2018 financial guidance. Any future impacts would only take effect upon the execution and settlement of a rate case. In the event of a rate case, all cost of service framework components would be taken into consideration which we expect to offset a significant portion of any impacts related to the new FERC policy. Any unmitigated impacts are not anticipated to materially change SEP's distributable cash flow outlook beyond 2018.
Important details of implementing the new revised policy statement require further clarification and SEP will continue to assess the financial impacts as more information becomes available.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2017 Form 10-K, filed on February 15, 2018, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 16,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York stock exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media: |
Michael Barnes |
Toll Free: (888) 992-0997 | |
michael.barnes@enbridge.com | |
Analysts and Investors: |
Roni Cappadonna |
(713) 627-4778 or Toll Free: (800) 481-2804 | |
roni.cappadonna@enbridge.com |
SOURCE Spectra Energy Partners, LP
DALLAS, Feb. 21, 2018 /PRNewswire/ -- Alerian reported index linked product positions of $16.3 billion as of December 31, 2017. Linked products include exchange-traded funds, exchange-traded notes, return of capital notes, variable insurance portfolios, and mutual funds.
Below is a full list of energy master limited partnership (MLP) positions, as of December 31, 2017, in products linked to the Alerian Index Series.
Ticker |
Exposure in |
Exposure in |
Ticker |
Exposure in |
Exposure in | |
AM |
318,072,149 |
10,952,898 |
MMP |
1,644,568,414 |
23,182,526 | |
AMGP |
754,587 |
38,265 |
MPLX |
1,279,929,181 |
36,084,837 | |
ANDX |
516,099,522 |
11,173,404 |
NBLX |
21,404,873 |
428,097 | |
APU |
76,556,528 |
1,655,992 |
NGL |
195,952,022 |
13,946,763 | |
ARLP |
20,166,275 |
1,023,669 |
NS |
296,565,295 |
9,902,013 | |
BPL |
908,164,717 |
18,328,249 |
NSH |
236,356 |
15,055 | |
BWP |
201,509,203 |
15,608,769 |
PAA |
1,085,692,515 |
52,601,382 | |
CEQP |
30,317,020 |
1,175,078 |
PAGP |
3,567,709 |
162,538 | |
CQP |
30,774,953 |
1,038,291 |
PSXP |
303,822,210 |
5,803,672 | |
DCP |
411,714,791 |
11,332,639 |
RMP |
197,598,050 |
9,203,449 | |
DM |
186,044,367 |
6,109,831 |
SEP |
397,826,315 |
10,061,364 | |
EEP |
372,358,764 |
26,962,981 |
SHLX |
369,468,507 |
12,389,957 | |
ENBL |
30,305,242 |
2,131,170 |
SMLP |
20,113,987 |
981,170 | |
ENLC |
1,134,945 |
64,485 |
SPH |
35,347,307 |
1,459,426 | |
ENLK |
317,615,016 |
20,664,607 |
SUN |
36,559,156 |
1,287,294 | |
EPD |
1,672,410,145 |
63,086,011 |
TCP |
350,896,258 |
6,608,216 | |
EQGP |
315,059 |
11,712 |
TEGP |
1,533,669 |
59,583 | |
EQM |
536,502,790 |
7,339,299 |
TEP |
269,478,027 |
5,877,383 | |
ETE |
6,574,648 |
380,918 |
TGP |
26,220,374 |
1,301,259 | |
ETP |
1,669,396,449 |
93,158,284 |
VLP |
23,823,578 |
535,361 | |
GEL |
300,264,393 |
13,434,648 |
VNOM |
20,179,418 |
864,956 | |
GLOP |
17,814,465 |
719,776 |
WES |
604,184,334 |
12,563,617 | |
GMLP |
26,442,305 |
1,159,750 |
WGP |
664,201 |
17,874 | |
HEP |
168,157,229 |
5,175,661 |
WPZ |
1,231,920,496 |
31,766,903 |
About Alerian
Alerian equips investors to make informed decisions about Master Limited Partnerships (MLPs) and energy infrastructure. Its benchmarks, including the flagship Alerian MLP Index (AMZ), are widely used by industry executives, investment professionals, research analysts, and national media to analyze relative performance. As of December 31, 2017, over $16 billion was directly tied to the Alerian Index Series through exchange-traded funds and notes, separately managed accounts, and structured products. For more information, including index values and constituents, research content, and announcements regarding rebalancings, please visit alerian.com.
View original content:http://www.prnewswire.com/news-releases/alerian-reports-december-31-2017-index-linked-product-positions-300602316.html
SOURCE Alerian
HOUSTON, Feb. 15, 2018 /PRNewswire/ - Spectra Energy Partners, LP (NYSE: SEP) today reported fourth quarter 2017 financial results and provided a quarterly business update.
HIGHLIGHTS AND PRESIDENT'S COMMENT
"Driven primarily by contributions from our successful expansion program, Spectra Energy Partners achieved yet another year of strong performance, delivering increased earnings, cash flows and distributions for our investors," said Bill Yardley, Chairman and President of Spectra Energy Partners.
"Our 2017 results reinforce the strength and stability of our fee-based business model and exceptional asset footprint which delivered strong operational performance and achieved top delivery days across our major U.S. pipelines over the recent winter period. We continue to create value for our investors now and into the future, as demonstrated by the recent announcement of our 41st consecutive quarterly distribution increase.
"We also are pleased to have successfully completed the elimination of SEP's incentive distribution rights, which enhances SEP's long-term value proposition and better positions SEP for extended growth," Mr. Yardley concluded.
U.S. TAX REFORM
On December 22, 2017, the United States implemented U.S. Tax Reform. The "Tax Cuts and Jobs Act" (TCJA) was signed into law and became enacted for tax purposes. Substantially all of the provisions of the TCJA are effective for taxation years beginning after December 31, 2017. The most significant change included in the TCJA, with respect to SEP's 2017 financial statements, was a reduction in the corporate federal income tax rate from 35% to 21%.
This tax rate change resulted in a non-cash $860 million charge in the fourth quarter 2017 to reflect the establishment of an estimated regulatory liability for the cost of service assets of SEP. This charge has no immediate net impact to the rate base of the affected entities. In the event of a future rate case, and subject to further regulatory guidance, we anticipate that the charge may be required to be amortized over the remaining useful life of the affected assets and would be one of many factors to be considered in establishing go-forward rates. SEP expects no material impact to cash flows over the 2018-2020 plan timeframe as a result of the TCJA.
FINANCIAL RESULTS SUMMARY
Spectra Energy Partners reported a net loss of $489 million, including a net loss from controlling interests of $496 million, for the fourth quarter ended December 31, 2017, with diluted earnings per limited partner unit of $(1.86). For the year, net income was $703 million, which included net income from controlling interests of $609 million, with diluted earnings per limited partner unit of $0.77. The fourth quarter and yearly results included special items of $854 million and $848 million, respectively, primarily attributable to the TCJA enacted in December 2017, which decreased diluted earnings per limited partner unit by $2.68 for the quarter and $2.68 for the year.
Fourth quarter 2017 ongoing distributable cash flow (DCF) was $358 million, compared with $330 million in the prior-year quarter. For the year, ongoing DCF was $1.53 billion, a $235 million increase from $1.30 billion in 2016. Distributions per limited partner unit paid in 2017 were $2.83, compared with $2.63 per limited partner unit in 2016. The full year distribution coverage ratio was 1.2x.
For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $532 million, compared with $510 million in the prior-year quarter. For the year, ongoing EBITDA was $2.18 billion, compared to $1.87 billion in 2016.
Ongoing net income from controlling interests was $358 million for the quarter, or $0.82 diluted earnings per limited partner unit, compared with $337 million, or $0.81 diluted earnings per limited partner unit in the prior-year quarter. The net loss from controlling interests was $496 million for the quarter, or $(1.86) diluted earnings per limited partner unit, compared with $301 million, or $0.70 diluted earnings per limited partner unit in the prior-year quarter.
For the year, ongoing net income from controlling interests was $1.46 billion, or $3.45 diluted earnings per limited partner unit, compared with $1.24 billion, or $3.10 diluted earnings per limited partner unit in 2016. Net income from controlling interests was $609 million in 2017, or $0.77 diluted earnings per limited partner unit, compared with $1.16 billion, or $2.84 diluted earnings per limited partner unit in 2016.
SEGMENT RESULTS
U.S. Transmission
Ongoing EBITDA from U.S. Transmission was $507 million in fourth quarter 2017, compared with $466 million in fourth quarter 2016. Fourth quarter 2017 results reflect increased earnings from expansion projects and slightly higher operating costs. As previously referenced, the 2017 ongoing quarterly results exclude $860 million attributable to the change in the federal income tax rate.
For the year 2017, ongoing EBITDA for U.S. Transmission was $2.01 billion, compared with $1.72 billion in 2016. The 2017 and 2016 ongoing EBITDA exclude special items of $21 million and $80 million in expenses, respectively, both related to the 2016 Texas Eastern pipeline incident. The 2017 ongoing results also exclude a special item of $860 million previously referenced and $34 million in expense, mainly from merger-related costs; primarily offset by a $106 million gain realized as a result of the deconsolidation and fair value re-measurement of our interest in Sabal Trail.
Liquids
Ongoing EBITDA from Liquids was $60 million in fourth quarter 2017, compared with $63 million in fourth quarter 2016. The decrease is mainly due to higher integrity and maintenance expenses.
For the year 2017, ongoing EBITDA for Liquids was $260 million, compared with $237 million in 2016. The increase is primarily a result of increased revenues due to the Express Enhancement project placed into service in October 2016.
Other
"Other" net expenses were $35 million in fourth quarter 2017, compared with $19 million in fourth quarter 2016.
For the year 2017, ongoing net expenses were $89 million, compared with net expenses of $82 million in 2016. The 2017 ongoing net expense excludes special items of $38 million, primarily from merger-related costs.
Interest Expense
Interest expense was $74 million in fourth quarter 2017, compared with $59 million in fourth quarter 2016, reflecting lower capitalized interest and higher average debt balances in 2017.
For the year 2017, interest expense was $265 million, compared with $224 million in 2016, reflecting higher average debt balances in 2017 and lower capitalized interest.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy Partners as of December 31, 2017, was $8.5 billion. Available liquidity at the end of the quarter was $353 million.
Including contributions from noncontrolling interests of $418 million, total capital and investment spending for the year was approximately $1.8 billion, and consisted of about $1.6 billion of growth capital expenditures and about $243 million of maintenance capital expenditures. Maintenance capital expenditures include a $44 million special item related to the 2016 Texas Eastern pipeline incident.
In 2017, Spectra Energy Partners received net proceeds of $171 million through its "At the Market" (ATM) equity issuance program, with $58 million raised in the fourth quarter.
Including contributions from noncontrolling interests, Spectra Energy Partners has $1.6 billion of capital expansion planned in 2018, which is expected to be funded through a combination of debt, equity, including the use of its ATM program, and return of capital from joint venture asset-level financings.
In early January, Texas Eastern issued $800 million of long-term debt split evenly between 10 and 30-year tranches at attractive coupons of 3.50% and 4.15%. The net proceeds from the offering were used to repay an affiliate loan of $400 million from SEP and remaining proceeds were distributed to SEP, which the Partnership used to pay down commercial paper and revolver borrowings.
EXPANSION PROJECT UPDATES
Spectra Energy Partners' 2017 growth program concluded with six projects placed into service, representing more than $2.0 billion of capital expansion, including:
Additionally, the Bayway Lateral was placed into service in late December, on budget and ahead of schedule.
Commercially Secured Projects
Approximately $2 billion of commercially secured projects are on target to be placed into service in 2018. Most notably, the $1.3 billion NEXUS project is under construction and remains on target to achieve in-service in third quarter 2018.
Progress continues on SEP's other projects in execution with PennEast receiving its FERC certificate in mid-January. We filed our FERC application in December for Lambertville East adding 60,000 Dth/d of capacity on Texas Eastern for utility customers in late 2019. SEP's other projects in execution continue to advance through various stages of the regulatory approval process and remain on track for their respective targeted in-service dates.
Development Opportunities
Natural gas pipeline capacity scarcity and system reliability remains a primary issue for New England and one that must be resolved for the region to meet its energy supply needs. We remain committed to bringing much needed affordable energy to New England consumers as we continue to explore energy solutions for the region. The dramatic wholesale electricity price spikes in late December and early January that resulted from the lack of gas pipeline capacity underscored the need for such a solution.
ADDITIONAL INFORMATION
Additional information about fourth quarter 2017 earnings can be obtained via the Spectra Energy Partners website: www.spectraenergypartners.com.
Spectra Energy Partners will host a joint webcast with Enbridge Inc. (TSX,NYSE: ENB) on February 16, 2018 at 8 a.m. CT. The webcast will be available via the Spectra Energy Partners Events & Presentations page, and the conference call can be accessed by dialing (877) 930-8043 in North America or (253) 336-7522 outside North America. The participant passcode is 4939158#.
A replay of the call will be available via the Spectra Energy Partners Events & Presentations page, or by dialing (855) 859-2056 in North America or (404) 537-3406 outside North America and using the above passcode.
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. Spectra Energy Partners' media and investor relations teams will be available after the call for any additional questions.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests as a measure to evaluate operations of the partnership. This measure is a non-GAAP financial measure as it represents net income from controlling interests, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measure for ongoing net income from controlling interests is net income from controlling interests.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Partners, LP. Ongoing EBITDA represents EBITDA, excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Partners, LP's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Partners, LP is net income.
The primary performance measures used by us to evaluate segment performance are segment EBITDA and Other EBITDA. We consider segment EBITDA and Other EBITDA, which are the GAAP measures used to report segment results, to be good indicators of each segment's operating performance from its continuing operations as they represent the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA and Other EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA as a measure of performance. Ongoing segment EBITDA is a non-GAAP financial measure, as it represents reported segment EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's ongoing performance across periods. The most directly comparable GAAP measure for ongoing segment EBITDA is segment EBITDA.
We also present Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the partnership to support distribution growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF, excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by distributions declared on partnership units. The most directly comparable GAAP measure for DCF coverage is Earnings-Per-Unit (EPU).
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other partnerships because other partnerships may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2017 Form 10-K, filed on February 15, 2018, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 16,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York Stock Exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
Spectra Energy Partners, LP | |||||||||||||
Quarterly Highlights | |||||||||||||
December 2017 | |||||||||||||
(Unaudited) | |||||||||||||
(millions of dollars, except per-unit amounts) | |||||||||||||
Reported - These results include the impact of special items | |||||||||||||
Three Months Ended |
Twelve Months Ended | ||||||||||||
December 31, |
December 31, | ||||||||||||
2017 |
(a) |
2016 |
2017 |
(a) |
2016 | ||||||||
INCOME |
|||||||||||||
Operating Revenues |
$ |
(138) |
$ |
663 |
$ |
1,950 |
$ |
2,533 | |||||
Total Reportable Segment EBITDA |
(287) |
493 |
1,458 |
1,876 | |||||||||
Net Income - Controlling Interests |
(496) |
301 |
609 |
1,161 | |||||||||
EBITDA BY BUSINESS SEGMENT |
|||||||||||||
U.S. Transmission |
$ |
(349) |
$ |
430 |
$ |
1,199 |
$ |
1,639 | |||||
Liquids |
62 |
63 |
259 |
237 | |||||||||
Total Reportable Segment EBITDA |
(287) |
493 |
1,458 |
1,876 | |||||||||
Other EBITDA |
(35) |
(19) |
(127) |
(82) | |||||||||
Total Reportable Segment and Other EBITDA |
$ |
(322) |
$ |
474 |
$ |
1,331 |
$ |
1,794 | |||||
PARTNERS' CAPITAL |
|||||||||||||
Declared Cash Distribution per Limited Partner Unit |
$ |
0.73875 |
$ |
0.68875 |
$ |
2.88000 |
$ |
2.68000 | |||||
Weighted Average Units Outstanding |
|||||||||||||
Limited Partner Units |
312 |
307 |
310 |
299 | |||||||||
General Partner Units |
6 |
6 |
6 |
6 | |||||||||
DISTRIBUTABLE CASH FLOW |
|||||||||||||
Distributable Cash Flow |
$ |
332 |
$ |
271 |
$ |
1,392 |
$ |
1,187 | |||||
CAPITAL AND INVESTMENT EXPENDITURES (b) |
|||||||||||||
Capital expenditures - U.S. Transmission |
$ |
1,867 |
$ |
2,280 | |||||||||
Capital expenditures - Liquids |
21 |
71 | |||||||||||
Investment expenditures |
337 |
251 | |||||||||||
Total |
$ |
2,225 |
$ |
2,602 | |||||||||
U.S. TRANSMISSION |
|||||||||||||
Operating Revenues |
$ |
(238) |
$ |
565 |
$ |
1,545 |
$ |
2,167 | |||||
Operating Expenses |
|||||||||||||
Operating, Maintenance and Other |
187 |
207 |
769 |
779 | |||||||||
Other Income and Expenses |
76 |
72 |
423 |
251 | |||||||||
EBITDA |
$ |
(349) |
$ |
430 |
$ |
1,199 |
$ |
1,639 | |||||
LIQUIDS |
|||||||||||||
Operating Revenues |
$ |
100 |
$ |
98 |
$ |
405 |
$ |
366 | |||||
Operating Expenses |
|||||||||||||
Operating, Maintenance and Other |
41 |
36 |
145 |
130 | |||||||||
Other Income and Expenses |
3 |
1 |
(1) |
1 | |||||||||
EBITDA |
$ |
62 |
$ |
63 |
$ |
259 |
$ |
237 | |||||
Express Pipeline Revenue Receipts, MBbl/d (c) |
263 |
259 |
262 |
241 | |||||||||
Platte PADD II Deliveries, MBbl/d |
129 |
127 |
130 |
130 | |||||||||
Canadian Dollar Exchange Rate, Average |
1.2717 |
1.33 |
1.2986 |
1.33 | |||||||||
December 31, |
December 31, | ||||||||||||
2017 |
2016 | ||||||||||||
Debt |
$ |
8,463 |
$ |
7,213 | |||||||||
Actual Units Outstanding |
319 |
315 |
(a) Reported results reflect the impact of the Federal Tax Reform Legislation enacted in December 2017 | ||||||||||||||||
(b) Excludes contributions received from noncontrolling interests of $418 million in 2017 and $492 million in 2016. | ||||||||||||||||
(c) Thousand barrels per day. |
Spectra Energy Partners, LP | |||||||||||
Condensed Consolidated Statements of Operations | |||||||||||
(Unaudited) | |||||||||||
(millions of dollars) | |||||||||||
Reported - These results include the impact of special items | |||||||||||
Three Months Ended |
Twelve Months Ended | ||||||||||
2017 |
2016 |
2017 |
2016 | ||||||||
Operating Revenues |
$ |
(138) |
$ |
663 |
$ |
1,950 |
$ |
2,533 | |||
Operating Expenses |
348 |
344 |
1,387 |
1,305 | |||||||
Operating Income |
(486) |
319 |
563 |
1,228 | |||||||
Other Income and Expenses |
76 |
72 |
424 |
253 | |||||||
Interest Expense |
74 |
59 |
265 |
224 | |||||||
Earnings Before Income Taxes |
(484) |
332 |
722 |
1,257 | |||||||
Income Tax Expense |
5 |
5 |
19 |
18 | |||||||
Net Income |
(489) |
327 |
703 |
1,239 | |||||||
Net Income - Noncontrolling Interests |
7 |
26 |
94 |
78 | |||||||
Net Income - Controlling Interests |
$ |
(496) |
$ |
301 |
$ |
609 |
$ |
1,161 |
Spectra Energy Partners, LP | ||||||
Condensed Consolidated Balance Sheets | ||||||
(Unaudited) | ||||||
(millions of dollars) | ||||||
December 31, |
December 31, | |||||
2017 |
2016 | |||||
ASSETS |
||||||
Current Assets |
$ |
561 |
$ |
660 | ||
Investments and Other Assets |
6,259 |
4,469 | ||||
Net Property, Plant and Equipment |
14,899 |
16,092 | ||||
Regulatory Assets and Deferred Debits |
337 |
385 | ||||
Total Assets |
$ |
22,056 |
$ |
21,606 | ||
LIABILITIES AND EQUITY |
||||||
Current Liabilities |
$ |
1,105 |
$ |
1,779 | ||
Long-term Debt |
7,963 |
6,223 | ||||
Deferred Credits and Other Liabilities |
1,087 |
200 | ||||
Equity |
11,901 |
13,404 | ||||
Total Liabilities and Equity |
$ |
22,056 |
$ |
21,606 |
Spectra Energy Partners, LP | ||||||||||||
Distributable Cash Flow | ||||||||||||
(Unaudited) | ||||||||||||
(millions of dollars) | ||||||||||||
Three Months Ended December 31, |
Twelve months ended | |||||||||||
2017 |
2016 |
2017 |
2016 | |||||||||
Net Income |
$ |
(489) |
$ |
327 |
$ |
703 |
$ |
1,239 | ||||
Add: |
||||||||||||
Interest expense |
74 |
59 |
265 |
224 | ||||||||
Income tax expense |
5 |
5 |
19 |
18 | ||||||||
Depreciation and amortization |
88 |
82 |
346 |
314 | ||||||||
Foreign currency (gain) loss |
— |
1 |
(1) |
1 | ||||||||
Less: |
||||||||||||
Third party interest income |
— |
— |
1 |
2 | ||||||||
EBITDA |
(322) |
474 |
1,331 |
1,794 | ||||||||
Add: |
||||||||||||
Earnings from equity investments |
(68) |
(35) |
(307) |
(127) | ||||||||
Distributions from equity investments |
53 |
28 |
185 |
160 | ||||||||
Noncash Impact of US Tax Reform |
860 |
— |
860 |
— | ||||||||
Other |
1 |
1 |
10 |
13 | ||||||||
Less: |
||||||||||||
Interest expense |
74 |
59 |
265 |
224 | ||||||||
Equity AFUDC |
8 |
37 |
115 |
121 | ||||||||
Net cash paid for income taxes |
3 |
3 |
15 |
10 | ||||||||
Distributions to non-controlling interests |
12 |
8 |
49 |
30 | ||||||||
Maintenance capital expenditures |
95 |
90 |
243 |
268 | ||||||||
Total Distributable Cash Flow |
$ |
332 |
$ |
271 |
$ |
1,392 |
$ |
1,187 |
Spectra Energy Partners, LP | ||||||||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | ||||||||||||||||||
Unaudited | ||||||||||||||||||
(In millions) | ||||||||||||||||||
Three Months Ended | ||||||||||||||||||
December 31, 2017 |
December 31, 2016 | |||||||||||||||||
Reported |
Less: Special |
Ongoing |
Reported |
Less: Special |
Ongoing | |||||||||||||
Net Income |
$ |
(489) |
$ |
(854) |
$ |
365 |
$ |
327 |
$ |
(36) |
$ |
363 | ||||||
Add: |
||||||||||||||||||
Interest expense |
74 |
— |
74 |
59 |
— |
59 | ||||||||||||
Income tax expense |
5 |
— |
5 |
5 |
— |
5 | ||||||||||||
Depreciation and amortization |
88 |
— |
88 |
82 |
— |
82 | ||||||||||||
Foreign currency loss |
— |
— |
— |
1 |
— |
1 | ||||||||||||
Less: |
||||||||||||||||||
Third party interest income |
— |
— |
— |
— |
— |
— | ||||||||||||
EBITDA |
(322) |
(854) |
532 |
474 |
(36) |
510 | ||||||||||||
Add: |
||||||||||||||||||
Earnings from equity investments |
(68) |
— |
(68) |
(35) |
— |
(35) | ||||||||||||
Distributions from equity investments |
53 |
— |
53 |
28 |
— |
28 | ||||||||||||
Noncash Impact of US Tax Reform |
860 |
860 |
— |
— |
— |
— | ||||||||||||
Other |
1 |
— |
1 |
1 |
— |
1 | ||||||||||||
Less: |
||||||||||||||||||
Interest expense |
74 |
— |
74 |
59 |
— |
59 | ||||||||||||
Equity AFUDC |
8 |
— |
8 |
37 |
— |
37 | ||||||||||||
Net cash paid for income taxes |
3 |
— |
3 |
3 |
— |
3 | ||||||||||||
Distributions to non-controlling interests |
12 |
— |
12 |
8 |
— |
8 | ||||||||||||
Maintenance capital expenditures |
95 |
32 |
63 |
90 |
23 |
67 | ||||||||||||
Total Distributable Cash Flow |
$ |
332 |
$ |
(26) |
$ |
358 |
$ |
271 |
$ |
(59) |
$ |
330 |
Spectra Energy Partners, LP | ||||||||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | ||||||||||||||||||
Unaudited | ||||||||||||||||||
(In millions) | ||||||||||||||||||
Twelve Months Ended | ||||||||||||||||||
December 31, 2017 |
December 31, 2016 | |||||||||||||||||
Reported |
Less: Special |
Ongoing |
Reported |
Less: Special |
Ongoing | |||||||||||||
Net Income |
$ |
703 |
$ |
(848) |
$ |
1,551 |
$ |
1,239 |
$ |
(80) |
$ |
1,319 | ||||||
Add: |
||||||||||||||||||
Interest expense |
265 |
— |
265 |
224 |
— |
224 | ||||||||||||
Income tax expense |
19 |
— |
19 |
18 |
— |
18 | ||||||||||||
Depreciation and amortization |
346 |
— |
346 |
314 |
— |
314 | ||||||||||||
Foreign currency (gain) loss |
(1) |
— |
(1) |
1 |
— |
1 | ||||||||||||
Less: |
||||||||||||||||||
Third party interest income |
1 |
— |
1 |
2 |
— |
2 | ||||||||||||
EBITDA |
1,331 |
(848) |
2,179 |
1,794 |
(80) |
1,874 | ||||||||||||
Add: |
||||||||||||||||||
Earnings from equity investments |
(307) |
(106) |
(201) |
(127) |
— |
(127) | ||||||||||||
Distributions from equity investments |
185 |
— |
185 |
160 |
— |
160 | ||||||||||||
Noncash Impact of US Tax Reform |
860 |
860 |
— |
— |
— |
— | ||||||||||||
Other |
10 |
— |
10 |
13 |
— |
13 | ||||||||||||
Less: |
||||||||||||||||||
Interest expense |
265 |
— |
265 |
224 |
— |
224 | ||||||||||||
Equity AFUDC |
115 |
— |
115 |
121 |
— |
121 | ||||||||||||
Net cash paid for income taxes |
15 |
— |
15 |
10 |
— |
10 | ||||||||||||
Distributions to non-controlling interests |
49 |
— |
49 |
30 |
— |
30 | ||||||||||||
Maintenance capital expenditures |
243 |
44 |
199 |
268 |
28 |
240 | ||||||||||||
Total Distributable Cash Flow |
$ |
1,392 |
$ |
(138) |
$ |
1,530 |
$ |
1,187 |
$ |
(108) |
$ |
1,295 |
Spectra Energy Partners, LP | ||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||
December 2017 Quarter-to-Date | ||||||||||
(Unaudited) | ||||||||||
(millions of dollars) | ||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported |
Less: Special Items |
Ongoing | |||||||
U.S. Transmission |
$ |
(349) |
$ |
(856) |
A |
$ |
507 | |||
Liquids |
62 |
2 |
60 | |||||||
Total Reportable Segment EBITDA |
(287) |
(854) |
567 | |||||||
Other |
(35) |
— |
(35) | |||||||
Total Reportable Segment and other EBITDA |
$ |
(322) |
$ |
(854) |
$ |
532 | ||||
EARNINGS |
||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
(322) |
$ |
(854) |
$ |
532 | ||||
Depreciation and Amortization |
(88) |
— |
(88) | |||||||
Interest Expense |
(74) |
— |
(74) | |||||||
Other Income and Expenses |
— |
— |
— | |||||||
Income Tax Expense |
(5) |
— |
(5) | |||||||
Total Net Income |
(489) |
(854) |
365 | |||||||
Total Net Income - Noncontrolling Interests |
(7) |
— |
(7) | |||||||
Total Net Income - Controlling Interests |
$ |
(496) |
$ |
(854) |
$ |
358 |
A - Primarily attributable to the Federal Tax Reform Legislation enacted in December 2017.
|
Spectra Energy Partners, LP | |||||||||||
Reported to Ongoing Earnings Reconciliation | |||||||||||
December 2017 Year-to-Date | |||||||||||
(Unaudited) | |||||||||||
(millions of dollars) | |||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported |
Less: Special Items |
Ongoing | ||||||||
U.S. Transmission |
$ |
1,199 |
$ |
(809) |
A |
$ |
2,008 | ||||
Liquids |
259 |
(1) |
B |
260 | |||||||
Total Reportable Segment EBITDA |
1,458 |
(810) |
2,268 | ||||||||
Other |
(127) |
(38) |
B |
(89) | |||||||
Total Reportable Segment and other EBITDA |
$ |
1,331 |
$ |
(848) |
$ |
2,179 | |||||
EARNINGS |
|||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
1,331 |
$ |
(848) |
$ |
2,179 | |||||
Depreciation and Amortization |
(346) |
— |
(346) | ||||||||
Interest Expense |
(265) |
— |
(265) | ||||||||
Other Income and Expenses |
2 |
— |
2 | ||||||||
Income Tax Expense |
(19) |
— |
(19) | ||||||||
Total Net Income |
703 |
(848) |
1,551 | ||||||||
Total Net Income - Noncontrolling Interests |
(94) |
— |
(94) | ||||||||
Total Net Income - Controlling Interests |
$ |
609 |
$ |
(848) |
$ |
1,457 |
A - Primarily attributable to the Federal Tax Reform Legislation enacted in December 2017, partially offset by a gain as a result of the deconsolidation and re-measurement of Sabal Trail. |
B - Primarily merger-related severance costs |
Spectra Energy Partners, LP | ||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||
December 2016 Quarter-to-Date | ||||||||||
(Unaudited) | ||||||||||
(millions of dollars) | ||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported |
Less: Special Items |
Ongoing | |||||||
U.S. Transmission |
$ |
430 |
$ |
(36) |
A |
$ |
466 | |||
Liquids |
63 |
— |
63 | |||||||
Total Reportable Segment EBITDA |
493 |
(36) |
529 | |||||||
Other |
(19) |
— |
(19) | |||||||
Total Reportable Segment and other EBITDA |
$ |
474 |
$ |
(36) |
$ |
510 | ||||
EARNINGS |
||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
474 |
$ |
(36) |
$ |
510 | ||||
Depreciation and Amortization |
(82) |
— |
(82) | |||||||
Interest Expense |
(59) |
— |
(59) | |||||||
Other Income and Expenses |
(1) |
— |
(1) | |||||||
Income Tax Expense |
(5) |
— |
(5) | |||||||
Total Net Income |
327 |
(36) |
363 | |||||||
Total Net Income - Noncontrolling Interests |
(26) |
— |
(26) | |||||||
Total Net Income - Controlling Interests |
$ |
301 |
$ |
(36) |
$ |
337 |
A- Inspection and repair costs related to the Texas Eastern pipeline incident in Pennsylvania. |
Spectra Energy Partners, LP | |||||||||||
Reported to Ongoing Earnings Reconciliation | |||||||||||
December 2016 Year-to-Date | |||||||||||
(Unaudited) | |||||||||||
(millions of dollars) | |||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported/ |
Less: Special Items |
Ongoing | ||||||||
U.S. Transmission |
$ |
1,639 |
$ |
(80) |
A |
$ |
1,719 | ||||
Liquids |
237 |
— |
237 | ||||||||
Total Reportable Segment EBITDA |
1,876 |
(80) |
1,956 | ||||||||
Other |
(82) |
— |
(82) | ||||||||
Total Reportable Segment and other EBITDA |
$ |
1,794 |
$ |
(80) |
$ |
1,874 | |||||
EARNINGS |
|||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
1,794 |
$ |
(80) |
$ |
1,874 | |||||
Depreciation and Amortization |
(314) |
— |
(314) | ||||||||
Interest Expense |
(224) |
— |
(224) | ||||||||
Other Income and Expenses |
1 |
— |
1 | ||||||||
Income Tax Expense |
(18) |
— |
(18) | ||||||||
Total Net Income |
1,239 |
(80) |
1,319 | ||||||||
Total Net Income - Noncontrolling Interests |
(78) |
— |
(78) | ||||||||
Total Net Income - Controlling Interests |
$ |
1,161 |
$ |
(80) |
$ |
1,241 |
A - Inspection and repair costs related to the Texas Eastern pipeline incident in Pennsylvania |
FOR FURTHER INFORMATION PLEASE CONTACT:
Media:
Michael Barnes
Toll Free: (888) 992-0997
michael.barnes@enbridge.com
Analysts and Investors:
Roni Cappadonna
Toll Free: (800) 481-2804
roni.cappadonna@enbridge.com
SOURCE Spectra Energy Partners, LP
Quarterly distribution increase of 1.25 cents to $0.73875 per unit
HOUSTON, Feb. 8, 2018 /PRNewswire/ - Spectra Energy Partners, LP (NYSE: SEP) announced today that the board of directors of the general partner declared a quarterly cash distribution to unitholders of $0.73875 per unit, an increase of 1.25 cents over the previous level of $0.72625 per unit. The cash distribution is payable on February 28, 2018, to unitholders of record at the close of business on February 20, 2018. This quarterly cash distribution equates to $2.955 per unit on an annual basis.
This information is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Under rules applicable to publicly-traded partnerships, our distributions to non-U.S. unitholders are subject to withholding tax at the highest effective applicable rate to the extent attributable to income that is effectively connected with the conduct of a U.S. trade or business. Given the uncertainty at the time of making distributions regarding the amount of any distribution that is attributable to income that is so effectively connected, we intend to treat all of our distributions as attributable to our U.S. operations, and as a result, the entire distribution will be subject to withholding.
Spectra Energy Partners
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York Stock Exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media:
Michael Barnes
Toll Free: (877) 496-8142
michael.barnes@enbridge.com
Analysts and Investors:
Roni Cappadonna
Toll Free: (800) 481-2804
roni.cappadonna@enbridge.com
SOURCE Spectra Energy Partners, LP
CALGARY, Jan. 22, 2018 /PRNewswire/ - Enbridge Inc. (TSX, NYSE: ENB) (Enbridge) will host a joint conference call and webcast with Enbridge Income Fund Holdings Inc. (TSX: ENF), Enbridge Energy Partners, L.P. (NYSE: EEP) and Spectra Energy Partners, LP (NYSE: SEP) to provide an enterprise-wide business update and review 2017 fourth quarter and year end financial results on February 16, 2018 at 7:00 a.m. MT (9:00 a.m. ET).
Enbridge and Enbridge Income Fund Holdings Inc. will announce fourth quarter earnings results before markets open on February 16, 2018, while Enbridge Energy Partners, L.P. and Spectra Energy Partners, LP will announce fourth quarter earnings results after markets close on February 15, 2018.
2017 Fourth Quarter and Year End Earnings Webcast and Conference Call
When: |
Friday, February 16, 2018 |
|
7:00 a.m. MT (9:00 a.m. ET) |
||
Webcast: |
||
Call: |
Dial-in # (Audio only – please dial in 10 minutes ahead): | |
North America Toll Free: |
1 (877) 930-8043 | |
Outside North America: |
1 (253) 336-7522 | |
Participant Passcode: |
4939158 |
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 company websites within approximately 24 hours after the event.
Replay: |
Audio Replay # (Available for 7 days after call): | |
North America Toll Free: |
1 (855) 859-2056 | |
Outside North America: |
1 (404) 537-3406 | |
Replay Passcode: |
4939158 |
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 Advisory
The conference call will cover each of Enbridge Inc., Enbridge Income Fund Holdings Inc., Enbridge Energy Partners, L.P. and Spectra Energy Partners, LP's (collectively, the Entities) most recent financial results and may contain forward-looking statements. When used in the call, words such as "anticipate", "expect", "project", and similar expressions are intended to identify such forward-looking statements. Although each of the Entities believes that its respective statements are or will be based on information and assumptions which are current, reasonable and complete, these statements are necessarily subject to a variety of risks and uncertainties pertaining to operating performance, regulatory parameters, economic conditions, commodity prices and other matters. You can find a discussion of those assumptions, risks and uncertainties in the Canadian securities law and/or American SEC filings for the applicable Entity. While each Entity makes its respective forward-looking statements in good faith, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. Except as may be required by applicable securities laws, no Entity assumes any obligation to publicly update or revise any forward-looking statements made herein, on the call or otherwise, whether as a result of new information, future events or otherwise.
About Enbridge Inc.
Enbridge Inc. is North America's premier energy infrastructure company with strategic business platforms that include an extensive network of crude oil, liquids and natural gas pipelines, regulated natural gas distribution utilities and renewable power generation. The Company safely delivers an average of 2.8 million barrels of crude oil each day through its Mainline and Express Pipeline, and accounts for nearly 65% of U.S.-bound Canadian crude oil production, and moves approximately 20% of all natural gas consumed in the U.S. serving key supply basins and demand markets. The Company's regulated utilities serve approximately 3.5 million retail customers in Ontario, Quebec, New Brunswick and New York State. Enbridge also has interests in more than 2,500 MW of net renewable generating capacity, and an expanding offshore wind portfolio in Europe. The Company has ranked on the Global 100 Most Sustainable Corporations index for the past eight years; its common shares trade on the Toronto and New York stock exchanges under the symbol ENB.
Life takes energy and Enbridge exists to fuel people's quality of life. For more information, visit www.enbridge.com.
About Enbridge Income Fund Holdings Inc.
Enbridge Income Fund Holdings Inc., through its investment in Enbridge Income Fund, indirectly holds high quality, low-risk energy infrastructure assets. Enbridge Income Fund's assets consist of a portfolio of Canadian liquids transportation and storage businesses, including the Canadian Mainline, the Regional Oil Sands System, the Canadian segment of the Southern Lights Pipeline, Class A units entitling the holder to receive defined cash flows from the US segment of the Southern Lights Pipeline, a 50 percent interest in the Alliance Pipeline, which transports natural gas from Canada to the U.S., and interests in more than 1,400 MW of renewable and alternative power generation assets. Enbridge Income Fund Holdings Inc. is a publicly traded corporation on the Toronto stock exchange under the symbol ENF; information about the company is available on its website at www.enbridgeincomefund.com.
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 23 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 company is available on its website at www.enbridgepartners.com.
About Spectra Energy Partners, LP
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York stock exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media:
Suzanne Wilton
Toll Free: (888) 992-0997
Email: suzanne.wilton@enbridge.com
Investment Community:
Enbridge Inc.
Jonathan Gould
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
Enbridge Income Fund Holdings Inc. & Enbridge Energy Partners, L.P.
Adam McKnight
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
Spectra Energy Partners, LP
Roni Cappadonna
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
SOURCE Enbridge Inc.
CALGARY, Jan. 22, 2018 /PRNewswire/ - Enbridge Inc. (Enbridge or the Company) (TSX:ENB)(NYSE:ENB) and Spectra Energy Partners, LP (SEP) (NYSE:SEP) today announced execution of a definitive agreement, resulting in Enbridge converting all of its incentive distribution rights (IDRs) and general partner (GP) economic interests in SEP into 172.5 million newly issued SEP common units. As part of the transaction, all of the IDRs have been eliminated. The 172.5 million newly issued SEP common units have a value of approximately US$7.2 billion based on the volume-weighted average price of SEP common units over the past twenty days. The transaction value represents a multiple of 15.7x forecast 2018 GP/IDR cash flow and is expected to be breakeven to SEP's distributable cash flow per common unit by the second half of 2019 and be accretive thereafter.
Enbridge now holds a non-economic GP interest in SEP and owns approximately 403 million SEP common units, representing approximately 83% of SEP's outstanding common units.
The transaction provides significant benefits to all SEP common unitholders. The elimination of the IDRs will improve SEP's competitiveness and growth potential by permanently improving its cost of capital, thereby improving value for both SEP unitholders and Enbridge. The transaction also simplifies SEP's capital structure and further aligns the interests of all SEP unitholders. SEP maintains its current guidance of 7% distribution growth in 2018 and 4-6% distribution growth in 2019-20, distribution coverage of 1.1x to 1.2x and a strong credit profile of sub 4.0x Debt/EBITDA.
Bill Yardley, President and Chairman of the Board of SEP added, "Today's transaction improves SEP's long-term value proposition. With an improved cost of capital, we are even better positioned to improve and extend SEP's distribution growth outlook through organic growth projects, potential future drop downs from Enbridge and third party acquisitions."
"We are pleased to have completed this transaction which we believe is a win-win for both Enbridge and SEP," said Al Monaco, President and Chief Executive Officer of Enbridge. "An even stronger SEP supports our strategic priority to continue to grow our natural gas business. The transaction also simplifies SEP and reinforces its value proposition as a best-in-class MLP that will create long-term benefits for investors in both organizations."
The Enbridge Board of Directors reviewed and approved this transaction with assistance from Barclays Capital Inc., acting as Enbridge's financial advisor, and Sullivan & Cromwell LLP and Vinson & Elkins LLP, acting as Enbridge's legal and tax advisors. The terms of the transaction were unanimously approved by the Board of Directors of the general partner of SEP, based on the unanimous approval and recommendation of the SEP GP board's conflicts committee, which is comprised entirely of independent directors. The conflicts committee engaged Jefferies LLC to act as its financial advisor and Locke Lord LLP to act as its legal advisor.
The transaction closed immediately after the signing of the definitive agreement.
FORWARD-LOOKING INFORMATION
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2016 Form 10-K, filed on February 24, 2017, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
ABOUT SPECTRA ENERGY PARTNERS
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York stock exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
ABOUT ENBRIDGE INC.
Enbridge Inc. is North America's premier energy infrastructure company with strategic business platforms that include an extensive network of crude oil, liquids and natural gas pipelines, regulated natural gas distribution utilities and renewable power generation. The Company safely delivers an average of 2.8 million barrels of crude oil each day through its Mainline and Express Pipeline; accounts for approximately 65% of U.S.-bound Canadian crude oil exports; and moves approximately 20% of all natural gas consumed in the U.S., serving key supply basins and demand markets. The Company's regulated utilities serve approximately3.6 million retail customers in Ontario, Quebec, New Brunswick and New York State. Enbridge also has interests in more than 2,500 MW of net renewable generating capacity in North America and Europe. The Company has ranked on the Global 100 Most Sustainable Corporations index for the past eight years; its common shares trade on the Toronto and New York stock exchanges under the symbol ENB.
Life takes energy and Enbridge exists to fuel people's quality of life. For more information, visit www.enbridge.com.
For more information please contact:
Enbridge Inc. – Media
Suzanne Wilton
(403) 231-7385 or Toll Free: (888) 992-0997
suzanne.wilton@enbridge.com
Enbridge Inc. – Investment Community
Jonathan Gould
Toll Free: (800) 481-2804
jonathan.gould@enbridge.com
Spectra Energy Partners – Media
Michael Barnes
Toll Free: (888) 992-0997
michael.barnes@enbridge.com
Spectra Energy Partners – Analysts and Investors
Roni Cappadonna
Toll Free: (800) 481-2804
roni.cappadonna@enbridge.com
SOURCE Enbridge Inc.
HOUSTON, Nov. 29, 2017 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) announced today its financial guidance for 2018 as well as its long term financial and business outlook. SEP's performance is expected to continue to benefit from ongoing expansion project execution and solid base business performance over the 2018 – 2020 timeframe. This long term outlook relies upon SEP's disciplined expansion model, strong investment grade balance sheet, solid distribution coverage and a stable, reliable business profile with no direct commodity exposure and limited volume risk.
Business Outlook
Spectra Energy Partners' financial and business outlook for the 2018 – 2020 period continues to be strong. SEP's earnings and cash flow growth are supported by more than $2 billion of projects placed into service in 2017 and an expected incremental $2.5 billion of secured projects to be placed into service over the 2018 – 2019 timeframe, most notably NEXUS and the completion of Atlantic Bridge. Expansion capex net of contributions from non-controlling interests is expected to be $1.4 billion in 2018. Strong gas market fundamentals and SEP's asset footprint connecting to major demand markets and multiple diverse supply basins are expected to provide continued growth opportunities for SEP over the foreseeable future in areas such as the Northeast and Gulf Coast regions of the U.S.
2018 Distributable Cash Flow Guidance
SEP expects 2018 Distributable Cash Flow (DCF) of $1.63 billion to $1.67 billion. The DCF outlook assumes maintenance capex of $230 million.
Distribution Guidance
SEP's distribution growth in 2018 is expected to be $0.0125 per LP unit per quarter, an increase from 2017 of approximately 7%. SEP expects annual total distribution coverage in 2018 of 1.1x to 1.2x. After 2018, the execution of the current secured organic growth plan alone supports distribution growth of 4% – 6% annually in 2019 and 2020, while maintaining distribution coverage of 1.1x to 1.2x. This outlook could be further enhanced with additional organic growth and future drop down transactions.
Target Credit Metrics
SEP expects to maintain its strong investment grade credit profile with enhanced credit metrics through the planning horizon. The partnership's Debt to EBITDA metric is expected to be below 4.0x through 2020.
Offer Received From Enbridge Inc.
Today SEP received a formal offer from Enbridge Inc. (NYSE:ENB), which owns SEP's general partner, to convert all of Enbridge's incentive distribution rights (IDRs) and general partner (GP) economic interests in SEP into a fixed number of additional common units of SEP and a non-economic GP interest in SEP. SEP's board of directors has convened a conflicts committee, comprised of independent members, to review and evaluate Enbridge's proposal. No assurance can be given that Enbridge and SEP will reach agreement on the proposed transaction. The DCF and distribution guidance discussed above does not take into consideration Enbridge's proposal.
Additional information about SEP's financial and business outlook will be discussed at the upcoming Enbridge Inc. investor conferences in New York and Toronto on December 12th and 13th, respectively.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2016 Form 10-K, filed on February 24, 2017, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Non-GAAP Reconciliations
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 and therefore a reconciliation is not available without unreasonable effort.
Spectra Energy Partners
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York stock exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
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SOURCE Spectra Energy Partners, LP
HOUSTON, Nov. 1, 2017 /PRNewswire/ - Spectra Energy Partners, LP (NYSE: SEP) today reported net income of $471 million, including net income from controlling interests of $460 million, for the third quarter ended September 30, 2017, with diluted earnings per limited partner unit of $1.15. The third quarter results included non-recurring special items of $80 million, which increased diluted earnings per limited partner unit by $0.26.
HIGHLIGHTS:
Third quarter 2017 ongoing distributable cash flow (DCF) was $398 million, compared with $313 million in the prior-year quarter. Full-year coverage is expected to be at the high end of the previously provided guidance range of 1.05x-1.15x.
For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $554 million, compared with $469 million in the prior-year quarter. Ongoing net income from controlling interests was $379 million for the quarter, or $0.89 diluted earnings per limited partner unit, compared with $313 million, or $0.76 diluted earnings per limited partner unit in the prior-year quarter. Net income from controlling interests was $460 million for the quarter, or $1.15 diluted earnings per limited partner unit, compared with $275 million, or $0.64 diluted earnings per limited partner unit in the prior-year quarter.
QUARTERLY DISTRIBUTION
Spectra Energy Partners announced today that the board of directors of the general partner declared a quarterly cash distribution to unitholders of $0.72625 per unit, an increase of 1.25 cents over the previous level of $0.71375 per unit and a 7.4% increase compared to third quarter 2016. The cash distribution is payable on November 29, 2017 to unitholders of record at the close of business on November 13, 2017. This quarterly cash distribution equates to $2.905 per unit on an annual basis.
PRESIDENT COMMENT
"Spectra Energy Partners achieved another solid quarter primarily due to the contributions from our robust expansion program," said Bill Yardley, Chairman and President of Spectra Energy Partners. "We are on track to place more than $2 billion of projects into service in 2017 which will support our continued stable cash flow generation for investors. Most notably, Sabal Trail was placed into service on-time and on-budget in July and we are bringing three additional projects into service in November – Access South, Adair Southwest and the initial phase of Atlantic Bridge. We are also pleased to have FERC approval for the NEXUS project, which is now under construction and scheduled to come into service in third quarter 2018.
"Our base business also continues to perform well. We realized a renewal rate of 98% of contracted revenues on our U.S. natural gas pipelines – a solid indication of the value our customers place on our services and existing strategic footprint.
"We are pleased to announce our quarterly cash distribution increase which marks the 10th consecutive year of quarterly distribution increases demonstrating SEP's low-risk, stable distributable cash flow model," Mr. Yardley concluded.
SEGMENT RESULTS
U.S. Transmission
Ongoing EBITDA from U.S. Transmission was $505 million in the third quarter 2017, compared with $430 million for the third quarter of 2016 and reflects increased earnings from expansion projects (AIM, Gulf Markets, NEXUS, Access South and Adair Southwest) and slightly lower operating costs. The 2017 and 2016 ongoing results exclude special items of $18 million and $38 million in expenses, respectively, both related to the 2016 Texas Eastern pipeline incident. The 2017 ongoing results also exclude a $106 million gain realized as a result of the deconsolidation and fair value re-measurement of our interest in Sabal Trail, partially offset by $4 million in expense, primarily from merger-related costs.
Liquids
Ongoing EBITDA from Liquids was $67 million in the third quarter 2017, compared with $60 million in the third quarter 2016. The increase is primarily a result of increased revenues due to the Express Enhancement project placed into service in October 2016.
Other
Ongoing net expenses from "Other" were $18 million and $21 million in the third quarters 2017 and 2016, respectively. The 2017 period excludes special items of $3 million, primarily from merger-related costs.
Interest Expense
Interest expense was $75 million in the third quarter 2017, compared with $53 million in the third quarter 2016, reflecting lower capitalized interest due to Sabal Trail being placed into service in July 2017, and higher average debt balances in 2017.
Liquidity and Capital Expenditures
Total debt outstanding as of September 30, 2017, was $8.3 billion, with available liquidity of approximately $600 million.
This year, Spectra Energy Partners has received net proceeds of $141 million through its "At the Market" (ATM) equity issuance program, inclusive of the General Partner's investment to maintain its 2% ownership.
Including contributions from non-controlling interests, Spectra Energy Partners has $1.5 billion of capital expansion spending planned in 2017, which is expected to be funded through a combination of debt, equity, including the use of its ATM program, and return of capital from joint venture asset-level financings. Total capital spending for the three months ended September 30, 2017, was $291 million, consisting of $222 million of growth capital expenditures and $69 million of maintenance capital expenditures.
EXPANSION PROJECT UPDATES
Commercially Secured Projects
Following Sabal Trail's on-time placement into service in early July, commercial operations in October increased to 700,000 dekatherms per day (Dth/d) from the initial levels of 400,000 Dth/d. The 515-mile pipeline will have the capacity to deliver approximately 1.1 billion cubic feet of natural gas per day to the Southeast U.S. markets once approved future expansions are completed.
Commercial service has been initiated on Access South and Adair Southwest. These projects, along with the Lebanon Extension and the Gulf Markets Expansion that were placed into service ahead of schedule in early August, complete the multi-year transformation of a significant portion of Texas Eastern into a bi-directional system. This expanded capability, along with Texas Eastern's M3 market access, provides up to 8 Bcf/d of deliverability out of the Marcellus and Utica basins.
The Connecticut facilities of Atlantic Bridge have been placed into service delivering revenues and incremental volumes on Algonquin to serve a New England LDC. Full in-service of all project facilities is expected in the second half of 2018.
Progress also continues on the Bayway Lateral and it remains on target to achieve in-service at the beginning of 2018.
The NEXUS and TEAL projects received their FERC certificates in August and NEXUS received its notice to proceed from FERC in early October. Construction is now underway on NEXUS and full in-service is targeted for third quarter 2018. In light of the prolonged lack of quorum at FERC and associated cost pressures, our portion of the estimated capex for NEXUS and TEAL has been revised to $1.3 billion and $200 million, respectively.
Progress continues on SEP's other projects in execution with Stratton Ridge receiving its Environmental Assessment in early October. We filed our FERC application for the Texas and Louisiana Markets Projects adding 157,500 Dth/d of demand-pull volume to our suite of southern area projects that are in execution. SEP's other projects in execution continue to advance through various stages of the regulatory approval process and remain on track for their respective targeted in-service dates.
Development Opportunities
We received interest from power generators and other end-use markets in the Midwest, Mid-Atlantic and Northeast regions through the Texas Eastern Enhanced Electric Reliability Project open season that concluded at the end of September. We are working with the customers who placed bids, tailoring service offerings to meet their needs. Electric reliability is receiving significant attention lately due to the Department of Energy recommending the reimbursement of generators for fuel security. This renewed focus may provide additional opportunities for our pipelines to reliably deliver firm transportation of fuel to the 70 plants attached to our pipeline systems.
ADDITIONAL INFORMATION
Additional information about third quarter 2017 earnings can be obtained via the Spectra Energy Partners website: www.spectraenergypartners.com.
Spectra Energy Partners will host a joint webcast with Enbridge Inc. (TSX,NYSE: ENB) on November 2, 2017 at 8 a.m. CT. The webcast will be available via the Spectra Energy Partners Events & Presentations page, and the conference call can be accessed by dialing (877) 930-8043 in North America or (253) 336-7522 outside North America. The participant passcode is 95724866#.
A replay of the call will be available via the Spectra Energy Partners Events & Presentations page, or by dialing (855) 859-2056 in North America or (404) 537-3406 outside North America and using the above passcode.
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. Spectra Energy Partners' media and investor relations teams will be available after the call for any additional questions.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests as a measure to evaluate operations of the partnership. This measure is a non-GAAP financial measure as it represents net income from controlling interests, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measure for ongoing net income from controlling interests is net income from controlling interests.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Partners, LP. Ongoing EBITDA represents EBITDA, excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Partners, LP's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Partners, LP is net income.
The primary performance measures used by us to evaluate segment performance are segment EBITDA and Other EBITDA. We consider segment EBITDA and Other EBITDA, which are the GAAP measures used to report segment results, to be good indicators of each segment's operating performance from its continuing operations as they represent the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA and Other EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA as a measure of performance. Ongoing segment EBITDA is a non-GAAP financial measure, as it represents reported segment EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's ongoing performance across periods. The most directly comparable GAAP measure for ongoing segment EBITDA is segment EBITDA.
We also present Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the partnership to support distribution growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF, excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by distributions declared on partnership units. The most directly comparable GAAP measure for DCF coverage is Earnings-Per-Unit (EPU).
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other partnerships because other partnerships may not calculate these measures in the same manner.
Distribution Information
This information is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Under rules applicable to publicly-traded partnerships, our distributions to non-U.S. unitholders are subject to withholding tax at the highest effective applicable rate to the extent attributable to income that is effectively connected with the conduct of a U.S. trade or business. Given the uncertainty at the time of making distributions regarding the amount of any distribution that is attributable to income that is so effectively connected, we intend to treat all of our distributions as attributable to our U.S. operations, and as a result, the entire distribution will be subject to withholding.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2016 Form 10-K, filed on February 24, 2017, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York stock exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT: | |
Media: |
Michael Barnes |
Toll Free: (877) 496-8142 | |
Analysts and Investors: |
Roni Cappadonna |
(713) 627-4778 or Toll Free: (800) 481-2804 | |
Spectra Energy Partners, LP | |||||||||||||
Quarterly Highlights | |||||||||||||
September 2017 | |||||||||||||
(Unaudited) | |||||||||||||
(millions of dollars, except per-unit amounts) | |||||||||||||
Reported - These results include the impact of special items | |||||||||||||
Three Months Ended |
Nine Months Ended | ||||||||||||
September 30, |
September 30, | ||||||||||||
2017 |
2016 |
2017 |
2016 | ||||||||||
INCOME |
|||||||||||||
Operating Revenues |
$ |
693 |
$ |
628 |
$ |
2,088 |
$ |
1,870 | |||||
Total Reportable Segment EBITDA |
656 |
452 |
1,745 |
1,383 | |||||||||
Net Income - Controlling Interests |
460 |
275 |
1,105 |
860 | |||||||||
EBITDA BY BUSINESS SEGMENT |
|||||||||||||
U.S. Transmission |
$ |
589 |
$ |
392 |
$ |
1,548 |
$ |
1,209 | |||||
Liquids |
67 |
60 |
197 |
174 | |||||||||
Total Reportable Segment EBITDA |
656 |
452 |
1,745 |
1,383 | |||||||||
Other EBITDA |
(21) |
(21) |
(92) |
(63) | |||||||||
Total Reportable Segment and Other EBITDA |
$ |
635 |
$ |
431 |
$ |
1,653 |
$ |
1,320 | |||||
PARTNERS' CAPITAL |
|||||||||||||
Declared Cash Distribution per Limited Partner Unit |
$ |
0.72625 |
$ |
0.67625 |
$ |
2.14125 |
$ |
1.99125 | |||||
Weighted Average Units Outstanding |
|||||||||||||
Limited Partner Units |
311 |
304 |
310 |
296 | |||||||||
General Partner Units |
6 |
6 |
6 |
6 | |||||||||
DISTRIBUTABLE CASH FLOW |
|||||||||||||
Distributable Cash Flow |
$ |
363 |
$ |
270 |
$ |
1,060 |
$ |
916 | |||||
CAPITAL AND INVESTMENT EXPENDITURES (a) |
|||||||||||||
Capital expenditures - U.S. Transmission |
$ |
1,576 |
$ |
1,561 | |||||||||
Capital expenditures - Liquids |
16 |
54 | |||||||||||
Investment expenditures |
218 |
112 | |||||||||||
Total |
$ |
1,810 |
$ |
1,727 | |||||||||
U.S. TRANSMISSION |
|||||||||||||
Operating Revenues |
$ |
595 |
$ |
535 |
$ |
1,783 |
$ |
1,602 | |||||
Operating Expenses |
|||||||||||||
Operating, Maintenance and Other |
181 |
217 |
582 |
572 | |||||||||
Other Income and Expenses |
175 |
74 |
347 |
179 | |||||||||
EBITDA |
$ |
589 |
$ |
392 |
$ |
1,548 |
$ |
1,209 | |||||
LIQUIDS |
|||||||||||||
Operating Revenues |
$ |
98 |
$ |
93 |
$ |
305 |
$ |
268 | |||||
Operating Expenses |
|||||||||||||
Operating, Maintenance and Other |
28 |
32 |
104 |
94 | |||||||||
Other Income and Expenses |
(3) |
(1) |
(4) |
— | |||||||||
EBITDA |
$ |
67 |
$ |
60 |
$ |
197 |
$ |
174 | |||||
Express Pipeline Revenue Receipts, MBbl/d (b) |
255 |
235 |
260 |
234 | |||||||||
Platte PADD II Deliveries, MBbl/d |
119 |
131 |
133 |
131 | |||||||||
Canadian Dollar Exchange Rate, Average |
1.25 |
1.30 |
1.31 |
1.32 | |||||||||
September 30, |
December 31, | ||||||||||||
2017 |
2016 | ||||||||||||
Debt |
$ |
8,253 |
$ |
7,213 | |||||||||
Actual Units Outstanding |
317 |
315 |
(a) Excludes contributions received from noncontrolling interests of $416 million in 2017 and $437 million in 2016. |
(b) Thousand barrels per day. |
Spectra Energy Partners, LP | ||||||||||||
Condensed Consolidated Statements of Operations | ||||||||||||
(Unaudited) | ||||||||||||
(millions of dollars) | ||||||||||||
Reported - These results include the impact of special items | ||||||||||||
Three Months Ended |
Nine Months Ended | |||||||||||
2017 |
2016 |
2017 |
2016 | |||||||||
Operating Revenues |
$ |
693 |
$ |
628 |
$ |
2,088 |
$ |
1,870 | ||||
Operating Expenses |
319 |
348 |
1,039 |
961 | ||||||||
Operating Income |
374 |
280 |
1,049 |
909 | ||||||||
Other Income and Expenses |
176 |
73 |
348 |
181 | ||||||||
Interest Expense |
75 |
53 |
191 |
165 | ||||||||
Earnings Before Income Taxes |
475 |
300 |
1,206 |
925 | ||||||||
Income Tax Expense |
4 |
4 |
14 |
13 | ||||||||
Net Income |
471 |
296 |
1,192 |
912 | ||||||||
Net Income - Noncontrolling Interests |
11 |
21 |
87 |
52 | ||||||||
Net Income - Controlling Interests |
$ |
460 |
$ |
275 |
$ |
1,105 |
$ |
860 |
Spectra Energy Partners, LP | |||||||
Condensed Consolidated Balance Sheets | |||||||
(Unaudited) | |||||||
(millions of dollars) | |||||||
September 30, |
December 31, | ||||||
2017 |
2016 | ||||||
ASSETS |
|||||||
Current Assets |
$ |
504 |
$ |
660 | |||
Investments and Other Assets |
6,298 |
4,469 | |||||
Net Property, Plant and Equipment |
14,596 |
16,092 | |||||
Regulatory Assets and Deferred Debits |
321 |
385 | |||||
Total Assets |
$ |
21,719 |
$ |
21,606 | |||
LIABILITIES AND EQUITY |
|||||||
Current Liabilities |
$ |
2,992 |
$ |
1,779 | |||
Long-term Debt |
5,714 |
6,223 | |||||
Deferred Credits and Other Liabilities |
203 |
200 | |||||
Equity |
12,810 |
13,404 | |||||
Total Liabilities and Equity |
$ |
21,719 |
$ |
21,606 |
Spectra Energy Partners, LP | |||||||||||||
Distributable Cash Flow | |||||||||||||
(Unaudited) | |||||||||||||
(millions of dollars) | |||||||||||||
Three Months Ended |
Nine Months Ended | ||||||||||||
2017 |
2016 |
2017 |
2016 | ||||||||||
Net Income |
$ |
471 |
$ |
296 |
$ |
1,192 |
$ |
912 | |||||
Add: |
|||||||||||||
Interest expense |
75 |
53 |
191 |
165 | |||||||||
Income tax expense |
4 |
4 |
14 |
13 | |||||||||
Depreciation and amortization |
86 |
78 |
258 |
232 | |||||||||
Foreign currency (gain) loss |
(1) |
— |
(1) |
— | |||||||||
Less: |
|||||||||||||
Third party interest income |
— |
— |
1 |
2 | |||||||||
EBITDA |
635 |
431 |
1,653 |
1,320 | |||||||||
Add: |
|||||||||||||
Earnings from equity investments |
(161) |
(35) |
(239) |
(92) | |||||||||
Distributions from equity investments |
54 |
35 |
132 |
132 | |||||||||
Other |
9 |
9 |
9 |
12 | |||||||||
Less: |
|||||||||||||
Interest expense |
75 |
53 |
191 |
165 | |||||||||
Equity AFUDC |
14 |
38 |
107 |
84 | |||||||||
Net cash paid for income taxes |
4 |
2 |
12 |
7 | |||||||||
Distributions to non-controlling interests |
12 |
7 |
37 |
22 | |||||||||
Maintenance capital expenditures |
69 |
70 |
148 |
178 | |||||||||
Total Distributable Cash Flow |
$ |
363 |
$ |
270 |
$ |
1,060 |
$ |
916 |
Spectra Energy Partners, LP | ||||||||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | ||||||||||||||||||
Unaudited | ||||||||||||||||||
(In millions) | ||||||||||||||||||
Three Months Ended | ||||||||||||||||||
September 30, 2017 |
September 30, 2016 | |||||||||||||||||
Reported |
Less: |
Ongoing |
Reported |
Less: |
Ongoing | |||||||||||||
Net Income |
$ |
471 |
$ |
81 |
$ |
390 |
$ |
296 |
$ |
(38) |
$ |
334 | ||||||
Add: |
||||||||||||||||||
Interest expense |
75 |
— |
75 |
53 |
— |
53 | ||||||||||||
Income tax expense |
4 |
— |
4 |
4 |
— |
4 | ||||||||||||
Depreciation and amortization |
86 |
— |
86 |
78 |
— |
78 | ||||||||||||
Foreign currency loss |
(1) |
— |
(1) |
— |
— |
— | ||||||||||||
Less: |
||||||||||||||||||
Third party interest income |
— |
— |
— |
— |
— |
— | ||||||||||||
EBITDA |
635 |
81 |
554 |
431 |
(38) |
469 | ||||||||||||
Add: |
||||||||||||||||||
Earnings from equity investments |
(161) |
(106) |
(55) |
(35) |
— |
(35) | ||||||||||||
Distributions from equity investments |
54 |
— |
54 |
35 |
— |
35 | ||||||||||||
Other |
9 |
— |
9 |
9 |
— |
9 | ||||||||||||
Less: |
||||||||||||||||||
Interest expense |
75 |
— |
75 |
53 |
— |
53 | ||||||||||||
Equity AFUDC |
14 |
— |
14 |
38 |
— |
38 | ||||||||||||
Net cash paid for income taxes |
4 |
— |
4 |
2 |
— |
2 | ||||||||||||
Distributions to non-controlling interests |
12 |
— |
12 |
7 |
— |
7 | ||||||||||||
Maintenance capital expenditures |
69 |
10 |
59 |
70 |
5 |
65 | ||||||||||||
Total Distributable Cash Flow |
$ |
363 |
$ |
(35) |
$ |
398 |
$ |
270 |
$ |
(43) |
$ |
313 |
Spectra Energy Partners, LP | ||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||
September 2017 Quarter-to-Date | ||||||||||
(Unaudited) | ||||||||||
(millions of dollars) | ||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported |
Less: Special Items |
Ongoing | |||||||
U.S. Transmission |
$ |
589 |
$ |
84 |
A |
$ |
505 | |||
Liquids |
67 |
— |
67 | |||||||
Total Reportable Segment EBITDA |
656 |
84 |
572 | |||||||
Other |
(21) |
(3) |
B |
(18) | ||||||
Total Reportable Segment and other EBITDA |
$ |
635 |
$ |
81 |
$ |
554 | ||||
EARNINGS |
||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
635 |
$ |
81 |
$ |
554 | ||||
Depreciation and Amortization |
(86) |
— |
(86) | |||||||
Interest Expense |
(75) |
— |
(75) | |||||||
Other Income and Expenses |
1 |
— |
1 | |||||||
Income Tax Expense |
(4) |
— |
(4) | |||||||
Total Net Income |
471 |
81 |
390 | |||||||
Total Net Income - Noncontrolling Interests |
(11) |
— |
(11) | |||||||
Total Net Income - Controlling Interests |
$ |
460 |
$ |
81 |
$ |
379 |
A - Primarily attributable to a gain as a result of the deconsolidation and re-measurement of Sabal Trail, partially offset by inspection and repair costs related to Texas Eastern Pipeline incident |
|
B - Primarily merger-related severance costs |
Spectra Energy Partners, LP | ||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||
September 2017 Year-to-Date | ||||||||||
(Unaudited) | ||||||||||
(millions of dollars) | ||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported |
Less: |
Ongoing | |||||||
U.S. Transmission |
$ |
1,548 |
$ |
47 |
A |
$ |
1,501 | |||
Liquids |
197 |
(3) |
B |
200 | ||||||
Total Reportable Segment EBITDA |
1,745 |
44 |
1,701 | |||||||
Other |
(92) |
(38) |
B |
(54) | ||||||
Total Reportable Segment and other EBITDA |
$ |
1,653 |
$ |
6 |
$ |
1,647 | ||||
EARNINGS |
||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
1,653 |
$ |
6 |
$ |
1,647 | ||||
Depreciation and Amortization |
(258) |
— |
(258) | |||||||
Interest Expense |
(191) |
— |
(191) | |||||||
Other Income and Expenses |
2 |
— |
2 | |||||||
Income Tax Expense |
(14) |
— |
(14) | |||||||
Total Net Income |
1,192 |
6 |
1,186 | |||||||
Total Net Income - Noncontrolling Interests |
(87) |
— |
(87) | |||||||
Total Net Income - Controlling Interests |
$ |
1,105 |
$ |
6 |
$ |
1,099 |
A - Primarily attributable to a gain as a result of the deconsolidation and re-measurement of Sabal Trail, partially offset by inspection and repair costs related to Texas Eastern Pipeline incident |
B - Primarily merger-related severance costs |
Spectra Energy Partners, LP | ||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||
September 2016 Quarter-to-Date | ||||||||||
(Unaudited) | ||||||||||
(millions of dollars) | ||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported |
Less: |
Ongoing | |||||||
U.S. Transmission |
$ |
392 |
$ |
(38) |
A |
$ |
430 | |||
Liquids |
60 |
— |
60 | |||||||
Total Reportable Segment EBITDA |
452 |
(38) |
490 | |||||||
Other |
(21) |
— |
(21) | |||||||
Total Reportable Segment and other EBITDA |
$ |
431 |
$ |
(38) |
$ |
469 | ||||
EARNINGS |
||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
431 |
$ |
(38) |
$ |
469 | ||||
Depreciation and Amortization |
(78) |
— |
(78) | |||||||
Interest Expense |
(53) |
— |
(53) | |||||||
Other Income and Expenses |
— |
— |
— | |||||||
Income Tax Expense |
(4) |
— |
(4) | |||||||
Total Net Income |
296 |
(38) |
334 | |||||||
Total Net Income - Noncontrolling Interests |
(21) |
— |
(21) | |||||||
Total Net Income - Controlling Interests |
$ |
275 |
$ |
(38) |
$ |
313 |
A- Inspection and repair costs related to the Texas Eastern pipeline incident in Pennsylvania. |
Spectra Energy Partners, LP | ||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||
September 2016 Year-to-Date | ||||||||||
(Unaudited) | ||||||||||
(millions of dollars) | ||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported/ |
Less: |
Ongoing | |||||||
U.S. Transmission |
$ |
1,209 |
$ |
(44) |
A |
$ |
1,253 | |||
Liquids |
174 |
— |
174 | |||||||
Total Reportable Segment EBITDA |
1,383 |
(44) |
1,427 | |||||||
Other |
(63) |
— |
(63) | |||||||
Total Reportable Segment and other EBITDA |
$ |
1,320 |
$ |
(44) |
$ |
1,364 | ||||
EARNINGS |
||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
1,320 |
$ |
(44) |
$ |
1,364 | ||||
Depreciation and Amortization |
(232) |
— |
(232) | |||||||
Interest Expense |
(165) |
— |
(165) | |||||||
Other Income and Expenses |
2 |
— |
2 | |||||||
Income Tax Expense |
(13) |
— |
(13) | |||||||
Total Net Income |
912 |
(44) |
956 | |||||||
Total Net Income - Noncontrolling Interests |
(52) |
— |
(52) | |||||||
Total Net Income - Controlling Interests |
$ |
860 |
$ |
(44) |
$ |
904 |
A - Inspection and repair costs related to the Texas Eastern pipeline incident in Pennsylvania |
Spectra Energy Partners, LP | |||||||||
Distributable Cash Flow | |||||||||
(Unaudited) | |||||||||
(millions of dollars) | |||||||||
2017e (low) |
2017e (mid) |
2017e (high) | |||||||
Total Reported Net Income |
$ |
1,525 |
$ |
1,565 |
$ |
1,605 | |||
Add: |
|||||||||
Interest expense |
280 |
280 |
280 | ||||||
Income tax expense |
5 |
5 |
5 | ||||||
Depreciation and amortization |
350 |
350 |
350 | ||||||
EBITDA |
2,160 |
2,200 |
2,240 | ||||||
Add: |
|||||||||
Earnings from equity investments |
(200) |
(200) |
(200) | ||||||
Distributions from equity investments |
150 |
150 |
150 | ||||||
Other |
10 |
10 |
10 | ||||||
Less: |
|||||||||
Interest expense |
280 |
280 |
280 | ||||||
Equity AFUDC |
115 |
115 |
115 | ||||||
Net cash paid for income taxes |
15 |
15 |
15 | ||||||
Distributions to non-controlling interests |
45 |
45 |
45 | ||||||
Maintenance capital expenditures |
265 |
265 |
265 | ||||||
Total Distributable Cash Flow |
$ |
1,400 |
$ |
1,440 |
$ |
1,480 | |||
DCF Coverage |
1.05x |
1.10x |
1.15x |
SOURCE Spectra Energy Partners, LP
Quarterly distribution increase of 1.25 cents to $0.71375 per unit
HOUSTON, Aug. 2, 2017 /PRNewswire/ - Spectra Energy Partners, LP (NYSE: SEP) announced today that the board of directors of the general partner of its general partner declared a quarterly cash distribution to unitholders of $0.71375 per unit, an increase of 1.25 cents over the previous level of $0.70125 per unit. The cash distribution is payable on August 29, 2017, to unitholders of record at the close of business on August 15, 2017. This quarterly cash distribution equates to $2.855 per unit on an annual basis.
This information is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Under rules applicable to publicly-traded partnerships, our distributions to non-U.S. unitholders are subject to withholding tax at the highest effective applicable rate to the extent attributable to income that is effectively connected with the conduct of a U.S. trade or business. Given the uncertainty at the time of making distributions regarding the amount of any distribution that is attributable to income that is so effectively connected, we intend to treat all of our distributions as attributable to our U.S. operations, and as a result, the entire distribution will be subject to withholding.
Spectra Energy Partners
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York stock exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media: |
Michael Barnes |
Toll Free: (877) 496-8142 | |
Analysts and Investors: |
Roni Cappadonna |
(713) 627-4778 or Toll Free: (800) 481-2804 | |
SOURCE Spectra Energy Partners, LP
CALGARY, July 18, 2017 /PRNewswire/ - Enbridge Inc. (TSX, NYSE: ENB) (Enbridge) will host a joint conference call and webcast with Enbridge Income Fund Holdings Inc. (TSX: ENF), Enbridge Energy Partners, L.P. (NYSE: EEP) and Spectra Energy Partners, LP (NYSE: SEP) to provide an enterprise wide business update and review 2017 second quarter financial results on August 3 at 7:00 a.m. MT (9:00 a.m. ET). Enbridge and Enbridge Income Fund Holdings Inc. will announce second quarter earnings results before markets open on August 3, while Enbridge Energy Partners, L.P. and Spectra Energy Partners, LP will announce second quarter earnings results after markets close on August 2, 2017.
Second Quarter 2017 Earnings Webcast and Conference Call
When: |
Thursday, August 3, 2017 | |
7:00 a.m. MT (9:00 a.m. ET) | ||
Webcast: |
||
Call: |
Dial-in # (Audio only – please dial in 10 minutes ahead): | |
North America Toll Free: |
1 (877) 930-8043 | |
Outside North America: |
1 (253) 336-7522 | |
Participant Passcode: |
51403910# |
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 company websites within approximately 24 hours after the event.
Replay: |
Audio Replay # (Available for 7 days after call): | |
North America Toll Free: |
1 (855) 859-2056 | |
Outside North America |
1 (404) 537-3406 | |
Replay Passcode: |
51403910# |
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 Advisory
The conference call will cover each of Enbridge Inc., Enbridge Income Fund Holdings Inc., Enbridge Energy Partners, L.P. and Spectra Energy Partners, LP's (collectively, the Entities) most recent financial results and may contain forward-looking statements. When used in the call, words such as "anticipate", "expect", "project", and similar expressions are intended to identify such forward-looking statements. Although each of the Entities believes that its respective statements are or will be based on information and assumptions which are current, reasonable and complete, these statements are necessarily subject to a variety of risks and uncertainties pertaining to operating performance, regulatory parameters, economic conditions, commodity prices and other matters. You can find a discussion of those assumptions, risks and uncertainties in the Canadian securities law and/or American SEC filings for the applicable Entity. While each Entity makes its respective forward-looking statements in good faith, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. Except as may be required by applicable securities laws, no Entity assumes any obligation to publicly update or revise any forward-looking statements made herein, on the call or otherwise, whether as a result of new information, future events or otherwise.
About Enbridge Inc.
Enbridge Inc. is North America's premier energy infrastructure company with strategic business platforms that include an extensive network of crude oil, liquids and natural gas pipelines, regulated natural gas distribution utilities and renewable power generation. The Company safely delivers an average of 2.8 million barrels of crude oil each day through its Mainline and Express Pipeline, and accounts for nearly 68% of U.S.-bound Canadian crude oil production, and moves approximately 20% of all natural gas consumed in the U.S. serving key supply basins and demand markets. The Company's regulated utilities serve approximately 3.5 million retail customers in Ontario, Quebec, New Brunswick and New York State. Enbridge also has a growing involvement in electricity infrastructure with interests in more than 2,500 MW of net renewable generating capacity, and an expanding offshore wind portfolio in Europe. The Company has ranked on the Global 100 Most Sustainable Corporations index for the past eight years; its common shares trade on the Toronto and New York stock exchanges under the symbol ENB.
Life takes energy and Enbridge exists to fuel people's quality of life. For more information, visit www.enbridge.com.
About Enbridge Income Fund Holdings Inc.
Enbridge Income Fund Holdings Inc., through its investment in Enbridge Income Fund, indirectly holds high quality, low-risk energy infrastructure assets. Enbridge Income Fund's assets consist of a portfolio of Canadian liquids transportation and storage businesses, including the Canadian Mainline, the Regional Oil Sands System, the Canadian segment of the Southern Lights Pipeline, Class A units entitling the holder to receive defined cash flows from the US segment of the Southern Lights Pipeline, a 50 percent interest in the Alliance Pipeline, which transports natural gas from Canada to the U.S., and interests in more than 1,400 MW of renewable and alternative power generation assets. Enbridge Income Fund Holdings Inc. is a publicly traded corporation on the Toronto stock exchange under the symbol ENF; information about the company is available on its website at www.enbridgeincomefund.com.
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 23 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 company is available on its website at www.enbridgepartners.com.
About Spectra Energy Partners, LP
Spectra Energy Partners, LP is one of the largest pipeline master limited partnerships in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. Spectra Energy Partners, LP is traded on the New York stock exchange under the symbol SEP; information about the company is available on its website at www.spectraenergypartners.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Media:
Suzanne Wilton
(403) 231-7385 or Toll Free: (888) 992-0997
Email: suzanne.wilton@enbridge.com
Investment Community:
Enbridge Inc.
Jonathan Gould
Toll Free: (800) 481-2804
Email: investor.relations@enbridge.com
Enbridge Income Fund Holdings Inc. & Enbridge Energy Partners, L.P.
Adam McKnight
(403) 266-7922 or Toll Free: (800) 481-2804
Email: adam.mcknight@enbridge.com
Spectra Energy Partners, LP
Roni Cappadonna
(713) 627-4778 or Toll Free: (800) 481-2804
Email: roni.cappadonna@enbridge.com
SOURCE Spectra Energy Partners, LP
LAKE MARY, Fla., July 5, 2017 /PRNewswire/ -- Sabal Trail Transmission, LLC (Sabal Trail), a joint venture of Spectra Energy Partners, LP (NYSE: SEP), NextEra Energy, Inc., and Duke Energy, announced today that on July 3, 2017, it placed into commercial service its pipeline system and facilities from Alexander City, Alabama, to the Central Florida Hub in Kissimmee, Florida.
"Sabal Trail has successfully navigated a rigorous environmental permitting process over the past four years while working with landowners and key stakeholders to construct this new pipeline system. With the completion of this project, Florida Power & Light and Duke Energy will realize needed firm natural gas transportation services to meet their power generation requirements. We are pleased to reach this critical milestone and serve our customers in the Southeast U.S.," said Bill Yardley, President and Chairman of the Board of Spectra Energy Partners.
Sabal Trail will provide 400,000 dekatherms per day of firm transportation to Florida Power & Light in time for them to meet their peak cooling season. Additionally, Duke Energy Florida will accept 300,000 dekatherms of firm delivery daily once its Citrus County combined-cycle natural gas plant is ready to receive natural gas. The 515-mile pipeline will have the capacity to deliver approximately 1.1 billion cubic feet of natural gas per day to the Southeast U.S. once approved future compression expansions occur.
For more information on Sabal Trail, visit www.sabaltrail.com.
Spectra Energy Partners
Spectra Energy Partners, LP (NYSE: SEP), an Enbridge Inc. company, is a Houston-based master limited partnership. SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage.
NextEra Energy
NextEra Energy, Inc. (NYSE: NEE) is a leading clean energy company with consolidated revenues of approximately $16.2 billion, approximately 45,900 megawatts of generating capacity, which includes megawatts associated with noncontrolling interests related to NextEra Energy Partners, LP (NYSE: NEP), and approximately 14,700 employees in 30 states and Canada as of year-end 2016. Headquartered in Juno Beach, Fla., NextEra Energy's principal subsidiaries are Florida Power & Light Company, which serves approximately 4.9 million customer accounts in Florida and is one of the largest rate-regulated electric utilities in the United States, and NextEra Energy Resources, LLC, which, together with its affiliated entities, is the world's largest generator of renewable energy from the wind and sun. Through its subsidiaries, NextEra Energy generates clean, emissions-free electricity from eight commercial nuclear power units in Florida, New Hampshire, Iowa and Wisconsin. A Fortune 200 company and included in the S&P 100 index, NextEra Energy has been recognized often by third parties for its efforts in sustainability, corporate responsibility, ethics and compliance, and diversity, and has been ranked No. 1 in the electric and gas utilities industry in Fortune's 2017 list of "World's Most Admired Companies." For more information about NextEra Energy companies, visit these websites: www.NextEraEnergy.com, www.FPL.com, www.NextEraEnergyResources.com.
Duke Energy
Headquartered in Charlotte, N.C., Duke Energy is one of the largest energy holding companies in the United States. Its Electric Utilities and Infrastructure business unit serves approximately 7.5 million customers located in six states in the Southeast and Midwest. The company's Gas Utilities and Infrastructure business unit distributes natural gas to approximately 1.6 million customers in the Carolinas, Ohio, Kentucky and Tennessee. Its Commercial Renewables business unit operates a growing renewable energy portfolio across the United States.
Duke Energy is a Fortune 125 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available at duke-energy.com.
The Duke Energy News Center serves as a multimedia resource for journalists and features news releases, helpful links, photos and videos. Hosted by Duke Energy, illumination is an online destination for stories about people, innovations, and community and environmental topics. It also offers glimpses into the past and insights into the future of energy.
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SOURCE Spectra Energy Partners, LP
HOUSTON, May 10, 2017 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) today reported net income of $354 million, including net income from controlling interests of $317 million, for the first quarter ended March 31, 2017, with diluted earnings per limited partner unit of $0.74. The first quarter included non-recurring special items of $46 million, which decreased diluted earnings per limited partner unit by $0.15.
Highlights:
First quarter 2017 ongoing distributable cash flow (DCF) was $403 million, compared with $371 million in the prior-year quarter. Distributions per limited partner unit for first quarter 2017 were $0.70125, compared with $0.65125 per limited partner unit in first quarter 2016.
For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $545 million, compared with $447 million in the prior-year quarter.
Ongoing net income from controlling interests was $363 million for the quarter, or $0.89 diluted earnings per limited partner unit, compared with $298 million, or $0.80 diluted earnings per limited partner unit, in the prior-year quarter. Net income from controlling interests was $317 million for the quarter, or $0.74 diluted earnings per limited partner unit, compared with $298 million, or $0.80 diluted earnings per limited partner unit, in the prior-year quarter.
PRESIDENT COMMENT
"As seen in this quarter's results, Spectra Energy Partners' strong base business continues to perform well, and is being further enhanced by the expansion projects we placed into service in 2016 and those that we are advancing," said Bill Yardley, chairman and president of Spectra Energy Partners. "We continue to generate solid and reliable cash flows that support our distribution growth, and earlier this month we announced our 38th consecutive quarterly distribution increase.
"The progress we are making on the high-quality growth projects we have in execution, the strength of our fee-based business model that has no direct commodity exposure and virtually no volume exposure, and our long-term contracts with high credit-quality customers are what continue to make Spectra Energy Partners a compelling investment."
SEGMENT RESULTS
U.S. Transmission
Ongoing EBITDA from U.S. Transmission was $499 million in first quarter 2017, compared with $411 million in first quarter 2016. These favorable results reflect increased earnings from expansion projects, including AIM, Sabal Trail, phase one of Gulf Markets and NEXUS. The 2017 ongoing results exclude special items of $18 million, primarily from merger-related severance costs, and $2 million in expense related to the 2016 Texas Eastern pipeline incident.
Liquids
Ongoing EBITDA from Liquids was $68 million in first quarter 2017, compared with $56 million in first quarter 2016. These results reflect expansion revenues from the Express Enhancement project placed into service in October 2016 and higher transportation revenues due to higher volumes of heavy oil on the Express Pipeline, partially offset by higher operating costs (primarily power). The 2017 period excludes a special item of $2 million for merger-related severance costs.
Other
Ongoing net expenses from "Other" were $22 million and $20 million in first quarters 2017 and 2016, respectively. The 2017 period excludes special items of $24 million, primarily from merger-related severance costs.
Interest Expense
Interest expense was $56 million in first quarters 2017 and 2016, reflecting higher average long-term debt balances in 2017, offset by higher capitalized interest.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy Partners as of March 31, 2017, was $7.7 billion, with available liquidity of $1.7 billion.
This year, Spectra Energy Partners has received net proceeds of $47 million through its "At the Market" (ATM) equity issuance program.
Including contributions from noncontrolling interests, Spectra Energy Partners has $1.8 billion of capital expansion spending planned in 2017, which is expected to be funded through a combination of debt, equity issued primarily through its ATM program, and return of capital from joint venture asset-level financings. Including contributions from noncontrolling interests of $290 million, total capital spending for the three months ended March 31, 2017, was $518 million, consisting of $492 million of growth capital expenditures and $26 million of maintenance capital expenditures.
EXPANSION PROJECT UPDATES
Spectra Energy Partners currently has $4.4 billion in capital expansion projects in execution.
Projects scheduled for 2017 in-service
Construction on Sabal Trail continues to advance on schedule, with in-service expected by the end of June.
Access South, Adair Southwest, Lebanon Extension, and the second phase of the Gulf Markets Expansion project are under construction, keeping these projects on target for in-service in the second half of this year.
Construction on Atlantic Bridge began this month, with initial in-service of the Connecticut facilities scheduled for the fourth quarter of 2017. Full in-service is expected in the second half of 2018.
NEXUS and TEAL anticipate receiving their FERC certificates shortly after FERC again has a quorum. The project team continues to explore multiple scenarios with its contractors for a 2017 in-service date, assuming receipt of the certificates in the second quarter of 2017.
Projects scheduled for 2018 and 2019 in-service
The Bayway Lateral project is on schedule for its first half of 2018 in-service date and the STEP project continues to target in-service in the second half of 2018.
The PennEast project continues to advance as well. FERC issued its Final Environmental Impact Statement (FEIS) in April, and the project is targeting a late 2018 in-service date. In March, PennEast announced that Spectra Energy Partners has entered into a purchase and sale agreement with PSEG Power LLC to acquire its 10 percent equity position in the project, which will increase Spectra Energy Partners' total equity investment to 20 percent. The sale is expected to close in the second quarter this year.
Stratton Ridge remains on schedule for in-service in the first half of 2019.
Open Season Results
Spectra Energy Partners has secured a commitment from an industrial market shipper in the STX Zone of its Texas Eastern system and conducted an open season that resulted in another binding commitment in the Southern Louisiana market area. These two commitments – making up the Texas-Louisiana Markets project – total 157,500 dekatherms per day (Dth/d) of Texas Eastern mainline expansion capacity, with scheduled in-service in the second half of 2019 and an estimated capital expenditure of approximately $20 million.
The company also held a successful open season to solicit interest for the Lambertville-East project, which will provide 60,000 Dth/d of firm transportation service on Texas Eastern's Zone M3 near Lambertville, New Jersey. The Texas Eastern expansion project is scheduled to be placed into service in the second half of 2019 and has an estimated capital expenditure of approximately $50 million.
"These projects are primarily driven by sustained demand growth and represent our ability to continue securing opportunities to grow our base business and leverage our existing asset footprint," Yardley said.
Development Projects
Access Northeast's partners continue to pursue a viable commercial and operational model to support New England's emission and reliability goals. The project's partners continue to discuss the gravity of New England's peak energy supply situation with regional policymakers, including in Massachusetts, where there is no recent legislation clarifying electric utilities' ability to sign natural gas supply contracts, and in New Hampshire, where an interpretation of the electric utilities' ability to do so is pending before the Supreme Court. Additionally, ISO-New England continues to express deep concern over the region's natural gas infrastructure constraints, and in the next several months plans to issue a report on the challenges New England will face during peak demand time if no significant natural gas transmission capacity is built into the region.
2017 GUIDANCE
Spectra Energy Partners expects 2017 DCF within the range of $1.4 billion to $1.48 billion. The partnership reaffirmed plans for quarterly penny-and-a-quarter distribution increases through 2017, and a coverage ratio within its targeted range of 1.05 to 1.15 times.
ADDITIONAL INFORMATION
Additional information about 2017 guidance and first quarter 2017 earnings can be obtained via the Spectra Energy Partners website: www.spectraenergypartners.com.
Spectra Energy Partners will host a joint webcast with Enbridge Inc. (TSX, NYSE: ENB) on May 11 at 8 a.m. CT.
The webcast will be available via the Spectra Energy Partners Events & Presentations page, and the conference call can be accessed by dialing (866) 215-5508 in North America or (514) 841-2157 outside North America. The participant passcode is 44798051#.
A replay of the call will be available via the Spectra Energy Partners Events & Presentations page, or by dialing (888) 843-7419 in North America or (630) 652-3042 outside North America and using the above passcode.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests as a measure to evaluate operations of the partnership. This measure is a non-GAAP financial measure as it represents net income from controlling interests, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measure for ongoing net income from controlling interests is net income from controlling interests.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Partners, LP. Ongoing EBITDA represents EBITDA, excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Partners, LP's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Partners, LP is net income.
The primary performance measures used by us to evaluate segment performance are segment EBITDA and Other EBITDA. We consider segment EBITDA and Other EBITDA, which are the GAAP measures used to report segment results, to be good indicators of each segment's operating performance from its continuing operations as they represent the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA and Other EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA as a measure of performance. Ongoing segment EBITDA is a non-GAAP financial measure, as it represents reported segment EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's ongoing performance across periods. The most directly comparable GAAP measure for ongoing segment EBITDA is segment EBITDA.
We also present Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the partnership to support distribution growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF, excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by distributions declared on partnership units. The most directly comparable GAAP measure for DCF coverage is Earnings-Per-Unit (EPU).
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other partnerships because other partnerships may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2016 Form 10-K, filed on February 24, 2017, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners, LP (NYSE: SEP), an Enbridge Inc. company, is a Houston-based master limited partnership. SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage.
Spectra Energy Partners, LP | |||||||||
Quarterly Highlights | |||||||||
March 2017 | |||||||||
(Unaudited) | |||||||||
(In millions, except per-unit amounts) | |||||||||
Reported - These results include the impact of special items | |||||||||
Three Months Ended |
|||||||||
March 31, |
|||||||||
2017 |
2016 |
||||||||
INCOME |
|||||||||
Operating Revenues |
$ |
700 |
$ |
624 |
|||||
Total Reportable Segment EBITDA |
545 |
467 |
|||||||
Net Income - Controlling Interests |
317 |
298 |
|||||||
EBITDA BY BUSINESS SEGMENT |
|||||||||
U.S. Transmission |
$ |
479 |
$ |
411 |
|||||
Liquids |
66 |
56 |
|||||||
Total Reportable Segment EBITDA |
545 |
467 |
|||||||
Other EBITDA |
(46) |
(20) |
|||||||
Total Reportable Segment and Other EBITDA |
$ |
499 |
$ |
447 |
|||||
PARTNERS' CAPITAL |
|||||||||
Declared Cash Distribution per Limited Partner Unit |
$ |
0.70125 |
$ |
0.65125 |
|||||
Weighted Average Units Outstanding |
|||||||||
Limited Partner Units |
309 |
285 |
|||||||
General Partner Units |
6 |
6 |
|||||||
DISTRIBUTABLE CASH FLOW |
|||||||||
Distributable Cash Flow |
$ |
356 |
$ |
371 |
|||||
CAPITAL AND INVESTMENT EXPENDITURES (a) |
|||||||||
Capital expenditures - U.S. Transmission |
$ |
732 |
$ |
452 |
|||||
Capital expenditures - Liquids |
6 |
16 |
|||||||
Investment expenditures |
70 |
27 |
|||||||
Total |
$ |
808 |
$ |
495 |
|||||
U.S. TRANSMISSION |
|||||||||
Operating Revenues |
$ |
596 |
$ |
538 |
|||||
Operating Expenses |
|||||||||
Operating, Maintenance and Other |
200 |
172 |
|||||||
Other Income and Expenses |
83 |
45 |
|||||||
EBITDA |
$ |
479 |
$ |
411 |
|||||
LIQUIDS |
|||||||||
Operating Revenues |
$ |
104 |
$ |
86 |
|||||
Operating Expenses |
|||||||||
Operating, Maintenance and Other |
37 |
31 |
|||||||
Other Income and Expenses |
(1) |
1 |
|||||||
EBITDA |
$ |
66 |
$ |
56 |
|||||
Express Pipeline Revenue Receipts, MBbl/d (b) |
271 |
233 |
|||||||
Platte PADD II Deliveries, MBbl/d |
146 |
124 |
|||||||
Canadian Dollar Exchange Rate, Average |
1.32 |
1.37 |
|||||||
March 31, |
December 31, |
||||||||
2017 |
2016 |
||||||||
Debt |
7,678 |
7,213 |
|||||||
Actual Units Outstanding |
316 |
315 |
|||||||
(a) Excludes contributions received from noncontrolling interests of $290 million in 2017 and $95 million in 2016. | |||||||||
(b) Thousand barrels per day. | |||||||||
Spectra Energy Partners, LP |
|||||||||||
Condensed Consolidated Statements of Operations |
|||||||||||
(Unaudited) |
|||||||||||
(In millions) |
|||||||||||
Reported - These results include the impact of special items |
|||||||||||
Three Months Ended |
|||||||||||
2017 |
2016 |
||||||||||
Operating Revenues |
$ |
700 |
$ |
624 |
|||||||
Operating Expenses |
368 |
300 |
|||||||||
Operating Income |
332 |
324 |
|||||||||
Other Income and Expenses |
83 |
47 |
|||||||||
Interest Expense |
56 |
56 |
|||||||||
Earnings Before Income Taxes |
359 |
315 |
|||||||||
Income Tax Expense |
5 |
4 |
|||||||||
Net Income |
354 |
311 |
|||||||||
Net Income - Noncontrolling Interests |
37 |
13 |
|||||||||
Net Income - Controlling Interests |
$ |
317 |
$ |
298 |
Spectra Energy Partners, LP | |||||||||||
Condensed Consolidated Balance Sheets | |||||||||||
(Unaudited) | |||||||||||
(In millions) | |||||||||||
March 31, |
December 31, | ||||||||||
2017 |
2016 | ||||||||||
ASSETS |
|||||||||||
Current Assets |
$ |
685 |
$ |
660 |
|||||||
Investments and Other Assets |
4,532 |
4,469 |
|||||||||
Net Property, Plant and Equipment |
16,795 |
16,092 |
|||||||||
Regulatory Assets and Deferred Debits |
409 |
385 |
|||||||||
Total Assets |
$ |
22,421 |
$ |
21,606 |
|||||||
LIABILITIES AND EQUITY |
|||||||||||
Current Liabilities |
$ |
2,199 |
$ |
1,779 |
|||||||
Long-term Debt |
6,212 |
6,223 |
|||||||||
Deferred Credits and Other Liabilities |
197 |
200 |
|||||||||
Equity |
13,813 |
13,404 |
|||||||||
Total Liabilities and Equity |
$ |
22,421 |
$ |
21,606 |
|||||||
Spectra Energy Partners, LP | |||||
Distributable Cash Flow | |||||
(Unaudited) | |||||
(In Millions) | |||||
Reported - These results include the impact of special items | |||||
Three Months Ended |
|||||
2017 |
2016 |
||||
Net Income |
$ 354 |
$ 311 |
|||
Add: |
|||||
Interest expense |
56 |
56 |
|||
Income tax expense |
5 |
4 |
|||
Depreciation and amortization |
85 |
77 |
|||
Foreign currency (gain) loss |
- |
(1) |
|||
Less: |
|||||
Third party interest income |
1 |
- |
|||
EBITDA |
499 |
447 |
|||
Add: |
|||||
Earnings from equity investments |
(38) |
(27) |
|||
Distributions from equity investments |
38 |
65 |
|||
Other |
1 |
2 |
|||
Less: |
|||||
Interest expense |
56 |
56 |
|||
Equity AFUDC |
45 |
17 |
|||
Net cash paid for income taxes |
5 |
1 |
|||
Distributions to non-controlling interests |
12 |
7 |
|||
Maintenance capital expenditures |
26 |
35 |
|||
Total Distributable Cash Flow |
$ 356 |
$ 371 |
Spectra Energy Partners, LP |
|||||||||||||||
Reported to Ongoing Earnings Reconciliation |
|||||||||||||||
March 2017 Year-to-Date |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In millions) |
|||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported Earnings |
Less: Special Items |
Ongoing Earnings |
||||||||||||
U.S. Transmission |
$ |
479 |
$ |
(20) |
A |
$ |
499 |
||||||||
Liquids |
66 |
(2) |
B |
68 |
|||||||||||
Total Reportable Segment EBITDA |
545 |
(22) |
567 |
||||||||||||
Other |
(46) |
(24) |
B |
(22) |
|||||||||||
Total Reportable Segment and other EBITDA |
$ |
499 |
$ |
(46) |
$ |
545 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
499 |
$ |
(46) |
$ |
545 |
|||||||||
Depreciation and Amortization |
(85) |
— |
(85) |
||||||||||||
Interest Expense |
(56) |
— |
(56) |
||||||||||||
Other Income and Expenses |
1 |
— |
1 |
||||||||||||
Income Tax Expense |
(5) |
— |
(5) |
||||||||||||
Total Net Income |
354 |
(46) |
400 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(37) |
— |
(37) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
317 |
$ |
(46) |
$ |
363 |
|||||||||
A - Primarily merger-related severance costs and $2 million in expense related to the 2016 Texas Eastern pipeline incident |
|||||||||||||||
B - Primarily merger-related severance costs |
|||||||||||||||
Spectra Energy Partners, LP |
||||||||
Reported to Ongoing Earnings Reconciliation |
||||||||
March 2016 Year-to-Date |
||||||||
(Unaudited) |
||||||||
(In millions) |
||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported/ Ongoing |
|||||||
U.S. Transmission |
$ |
411 |
||||||
Liquids |
56 |
|||||||
Total Reportable Segment EBITDA |
467 |
|||||||
Other |
(20) |
|||||||
Total Reportable Segment and other EBITDA |
$ |
447 |
||||||
EARNINGS |
||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
447 |
||||||
Depreciation and Amortization |
(77) |
|||||||
Interest Expense |
(56) |
|||||||
Other Income and Expenses |
1 |
|||||||
Income Tax Expense |
(4) |
|||||||
Total Net Income |
311 |
|||||||
Total Net Income - Noncontrolling Interests |
(13) |
|||||||
Total Net Income - Controlling Interests |
$ |
298 |
||||||
Spectra Energy Partners, LP | |||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | |||||||||
Unaudited | |||||||||
(In millions) | |||||||||
Three Months Ended | |||||||||
March 31, 2017 |
March 31, 2016 | ||||||||
Reported |
Less: |
Ongoing |
Reported/ | ||||||
Net Income |
$ 354 |
$ (46) |
$ 400 |
$ 311 | |||||
Add: |
|||||||||
Interest expense |
56 |
- |
56 |
56 | |||||
Income tax expense |
5 |
- |
5 |
4 | |||||
Depreciation and amortization |
85 |
- |
85 |
77 | |||||
Foreign currency loss |
- |
- |
- |
(1) | |||||
Less: |
|||||||||
Third party interest income |
1 |
- |
1 |
- | |||||
EBITDA |
499 |
(46) |
545 |
447 | |||||
Add: |
|||||||||
Earnings from equity investments |
(38) |
- |
(38) |
(27) | |||||
Distributions from equity investments |
38 |
- |
38 |
65 | |||||
Other |
1 |
- |
1 |
2 | |||||
Less: |
|||||||||
Interest expense |
56 |
- |
56 |
56 | |||||
Equity AFUDC |
45 |
- |
45 |
17 | |||||
Net cash paid for income taxes |
5 |
- |
5 |
1 | |||||
Distributions to non-controlling interests |
12 |
- |
12 |
7 | |||||
Maintenance capital expenditures |
26 |
1 |
25 |
35 | |||||
Total Distributable Cash Flow |
$ 356 |
$ (47) |
$ 403 |
$ 371 | |||||
SOURCE Spectra Energy Partners, LP
CALGARY, Alberta, April 21, 2017 /PRNewswire/ -- Enbridge Inc. (TSX, NYSE: ENB) (Enbridge) will host a joint conference call and webcast with Enbridge Income Fund Holdings Inc. (TSX: ENF), Enbridge Energy Partners, L.P. (NYSE: EEP) and Spectra Energy Partners, LP (NYSE: SEP) to provide an enterprise wide business update and review 2017 first quarter financial results on May 11 at 7:00 a.m. MT (9:00 a.m. ET). Enbridge and Enbridge Income Fund Holdings will announce first quarter earnings results before markets open on May 11, while Enbridge Energy Partners and Spectra Energy Partners will announce first quarter earnings results after markets close on May 10, 2017.
First Quarter 2017 Earnings Webcast and Conference Call
When: |
Thursday, May 11, 2017 | |
7:00 a.m. MT (9:00 a.m. ET) | ||
Webcast: |
||
Call: |
Dial-in # (Audio only – please dial in 10 minutes ahead): | |
North America Toll Free: |
1 (866) 215-5508 | |
Outside North America: |
1 (514) 841-2157 | |
Participant Passcode: |
44798051# |
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 various website within approximately 24 hours after the event.
Replay: |
Audio Replay # (Available for 7 days after call): | |
North America Toll Free: |
1 (888) 843-7419 | |
Outside North America |
1 (630) 652-3042 | |
Replay Passcode: |
44798051# |
The question and answer format of the call has changed to take questions only from the analyst and investor community on the call. Enbridge's media and investor relations teams will be available after the call for any additional questions.
Forward-Looking Statements Advisory
The conference call will cover each of Enbridge Inc., Enbridge Income Fund Holdings Inc., Enbridge Energy Partners, L.P. and Spectra Energy Partners, LP's (collectively, the Entities) most recent financial results and may contain forward-looking statements. When used in the call, words such as "anticipate", "expect", "project", and similar expressions are intended to identify such forward-looking statements. Although each of the Entities believes that its respective statements are or will be based on information and assumptions which are current, reasonable and complete, these statements are necessarily subject to a variety of risks and uncertainties pertaining to operating performance, regulatory parameters, economic conditions, commodity prices and other matters. You can find a discussion of those assumptions, risks and uncertainties in the Canadian securities law and/or American SEC filings for the applicable Entity. While each Entity makes its respective forward-looking statements in good faith, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. Except as may be required by applicable securities laws, no Entity assumes any obligation to publicly update or revise any forward-looking statements made herein, on the call or otherwise, whether as a result of new information, future events or otherwise.
About Enbridge Inc.
Enbridge Inc. is North America's premier energy infrastructure company with strategic business platforms that include an extensive network of crude oil, liquids and natural gas pipelines, regulated natural gas distribution utilities and renewable power generation. The Company safely delivers an average of 2.8 million barrels of crude oil each day through its Mainline and Express Pipeline, and accounts for nearly 68% of U.S.-bound Canadian crude oil production, and moves approximately 20% of all natural gas consumed in the U.S. serving key supply basins and demand markets. The Company's regulated utilities serve approximately 3.5 million retail customers in Ontario, Quebec, New Brunswick and New York State. Enbridge also has a growing involvement in electricity infrastructure with interests in more than 2,500 MW of net renewable generating capacity, and an expanding offshore wind portfolio in Europe. The Company has ranked on the Global 100 Most Sustainable Corporations index for the past eight years; its common shares trade on the Toronto and New York stock exchanges under the symbol ENB.
Life takes energy and Enbridge exists to fuel people's quality of life. For more information, visit www.enbridge.com.
About Enbridge Income Fund Holdings Inc.
Enbridge Income Fund Holdings Inc. is a publicly traded corporation. EIFH, through its investment in Enbridge Income Fund indirectly holds high quality, low- risk energy infrastructure assets. Enbridge Income Fund's assets consist of a portfolio of Canadian liquids transportation and storage businesses, including the Canadian Mainline, the Regional Oil Sands System, the Canadian segment of the Southern Lights Pipeline, Class A units entitling the holder to receive defined cash flows from the US segment of the Southern Lights Pipeline, a 50 percent interest in the Alliance Pipeline, which transports natural gas from Canada to the U.S., and interests in more than 1,400 MW of renewable and alternative power generation assets. Information about Enbridge Income Fund Holdings Inc. is available on EIFH's website at www.enbridgeincomefund.com.
About Enbridge Energy Partners, L.P.
Enbridge Energy Partners, L.P. owns and operates a diversified portfolio of crude oil and, through its interests in Midcoast Energy Partners, L.P. (Midcoast Partners) (NYSE: MEP), natural gas 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 23 percent of total U.S. oil imports. Midcoast Partners' natural gas gathering, treating, processing and transmission assets, which are principally located onshore in the active U.S. Mid-Continent and Gulf Coast areas, deliver approximately 1.5 billion cubic feet of natural gas daily.
About Spectra Energy Partners, LP
Spectra Energy Partner, LP (NYSE: SEP), an indirect, wholly-owned subsidiary of Enbridge Inc., is a Houston-based master limited partnership. SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage.
SOURCE Spectra Energy Partners, LP
HOUSTON, Feb. 27, 2017 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) (SEP) announced that, effective today, its general partner became an indirect, wholly-owned subsidiary of Enbridge Inc. (TSX, NYSE: ENB) (Enbridge), as a result of the completion of the combination of Enbridge and Spectra Energy Corp.
In conjunction with this change, effective today, Bill Yardley will assume the role of Chairman and President of the general partner of SEP. Greg Ebel, Pat Reddy, and Reggie Hedgebeth are resigning, effective today, from their roles as Chairman, President and CEO; Chief Financial Officer; and General Counsel, respectively, of the general partner of SEP.
"I want to thank our outgoing management team and directors for their dedication and service, and for establishing Spectra Energy Partners as a best-in-class MLP investment. We look forward to continuing that record of accomplishment," Mr. Yardley said. "The stable underpinnings of our business and our strategic and competitive asset footprint – with virtually no direct commodity or volume risk, high-quality demand-pull customers, excellent liquidity, and access to favorable capital markets – will continue to generate the steady cash flows that have benefited our unitholders for the past decade."
Mr. Yardley, John Whelen, Enbridge Executive Vice President and Chief Financial Officer; Vern Yu, Enbridge Executive Vice President and Chief Development Officer; and Laura Sayavedra, Enbridge Vice President of Sponsored Vehicles, will serve as management directors of the board of directors. J.D. Woodward, III, and Nora Brownell will continue to serve as non-management directors, along with new non-management director Michael G. Morris.
In addition to Mr. Ebel, Dorothy Ables, Julie Dill, and Fred Fowler have resigned, effective today, from the board of directors of the general partner of SEP.
Spectra Energy Partners, LP (NYSE: SEP), an indirect, wholly-owned subsidiary of Enbridge Inc. (TSX, NYSE: ENB), is a Houston-based master limited partnership. SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage. For more information, visit www.spectraenergypartners.com.
SOURCE Spectra Energy Partners, LP
HOUSTON, Feb. 24, 2017 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) today announced it has filed the partnership's Annual Report on Form 10-K with the Securities and Exchange Commission (SEC), for the year that ended December 31, 2016.
The report is available for viewing and downloading through the partnership's website, www.spectraenergypartners.com, on the Investors page under Publications & SEC Filings. Investors may also request a hard copy of the 10-K, free of charge, by e-mailing
IR-SEP@spectraenergy.com.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage.
SOURCE Spectra Energy Partners, LP
Highlights
- All conditions in merger agreement have been met; Transaction expected to close on February 27
- The combined company will be a global energy infrastructure leader and the largest energy infrastructure company in North America with roughly C$166 billion (US$126 billion) enterprise value
- Leading strategic business platforms including liquids and natural gas pipelines, natural gas distribution utilities and renewable power generation
- Industry leading C$27 billion (US$21 billion) of secured growth projects and approximately C$48 billion (US$37 billion) of probability weighted projects under development drives transparent long-term cash flow growth
- 10 to 12 percent average annual dividend increases expected from 2018 through 2024
- Strong, investment grade balance sheet
- Expected run-rate synergies of pre-tax C$540 million (US$415 million) by 2019, and estimated tax savings of C$260 million (US$200 million) beginning in 2019
CALGARY, Alberta and HOUSTON, Feb. 23, 2017 /PRNewswire/ -- Enbridge Inc. (TSX, NYSE:ENB) (Enbridge) and Spectra Energy Corp (NYSE:SE) (Spectra Energy) today announced that the previously announced merger of the two companies (the Transaction) has received all required regulatory clearances under the merger agreement, including from the Canadian Competition Bureau, and is expected to close on February 27, 2017.
"We are very pleased to have now received all required regulatory clearances and we look forward to realizing the significant customer and shareholder benefits of combining these two strong companies," said Al Monaco, President and Chief Executive Officer of Enbridge. "With the completion of the Transaction, Enbridge will become a leading global energy infrastructure company and the largest in North America with roughly C$166 billion (US$126 billion) in enterprise value and the strongest liquids and natural gas infrastructure franchises on the continent. We will have a diverse set of low-risk businesses comprised of a best in class network of crude oil, liquids and natural gas pipelines, a large portfolio of strong, regulated gas distribution utilities and a growing renewable power generation platform. The combined company will be positioned to provide integrated services and first and last mile connectivity to virtually all key liquids and gas supply basins and demand markets in North America."
Mr. Monaco added: "A significant amount of collaboration has allowed us to get to this point. The two companies have completed extensive planning in advance of closing and will be focused on a successful integration. Our teams are well prepared to ensure a smooth transition for our customers, employees and other stakeholders, while maintaining a sharp focus on our number one priority – the safety and reliability of our networks. We look forward to realizing the benefits of this strategic combination while delivering the energy people want and need."
Spectra Energy Chief Executive Officer Greg Ebel, who will become chairman of Enbridge once the Transaction closes, said: "By combining the strength of Enbridge with the strength of Spectra Energy, we are creating an unrivaled company that will provide superior value – now and into the future – for our customers, employees, investors and communities. The Transaction will significantly enhance and extend the dividend growth outlook for Spectra Energy shareholders. No other company in our industry will have this kind of high-return, low-risk model that investors value so highly."
Financial Matters
Enbridge expects the Transaction will support its 12 to 14 percent secured ACFFO per share CAGR guidance over the 2015-2019 planning horizon, and will be strongly additive to the Company's growth outlook beyond that timeframe.
As previously announced, following the closing of the Transaction, Enbridge will have a substantial capital project portfolio, including C$27 billion (US$21 billion) of commercially secured growth projects coming into service between 2017 and 2019, and C$48 billion probability-weighted development project portfolio. The growth program is expected to enable the Company to deliver highly visible ongoing dividend growth of 10 to 12 percent per year, on average, through 2024, while maintaining a conservative payout of 50 to 60 percent of ACFFO.
Enbridge is committed to maintaining its financial strength. In order to further reinforce its financial position and help support continued strong investment grade credit ratings, the Transaction was structured as a share for share exchange. No incremental debt will be incurred on closing of the Transaction. In addition, at the time the Transaction was announced last September, Enbridge set a target of monetizing C$2 billion of non-core assets to provide additional financial strength and flexibility. Approximately C$1.7 billion of that C$2 billion target has been achieved through the sale of its South Prairie Region assets and agreements to sell additional non-core assets. Enbridge management has identified other potential divestments that should enable the Company to meet or exceed this target. No follow-on equity offerings by Enbridge are required to complete funding of the combined secured C$27 billion (US$21 billion) secured growth program through 2019.
The combination is expected to achieve annual run-rate synergies of pre-tax C$540 million (US$415 million) by 2019. Detailed plans have been developed to capture a good portion of these synergies in the current year. In addition, the Company expects that approximately C$260 million (US$200 million) of tax savings can be achieved through utilization of tax losses commencing in 2019.
Guidance for the combined company for 2017 will be provided in conjunction with the first quarter financial results. Enbridge expects to provide a business and integration update for investors in June 2017 and is planning an investor conference in December, at which time additional detail on the Company's strategic priorities and long-range financial outlook will be provided.
Governance and Employee Matters
Enbridge announced today a new Board of Directors that will take effect as of the closing of the Transaction. Under the terms of the Transaction, the Board of Directors of Enbridge will consist of eight members designated by Enbridge, including Mr. Monaco (President and CEO), and five members designated by Spectra Energy, including Mr. Ebel as chairman of the board. Besides Mr. Monaco, the directors designated by Enbridge, all of whom currently serve as directors of Enbridge, are Marcel R. Coutu, J. Herb England, Charles W. Fischer, V. Maureen Kempston Darkes, Rebecca B. Roberts, Dan C. Tutcher and Catherine L. Williams. In addition to Mr. Ebel (Chair), the directors designated by Spectra Energy are Pamela L. Carter, Clarence P. Cazalot, Jr., Michael McShane and Michael E.J. Phelps, all of whom currently serve as directors of Spectra Energy.
Concurrent with the closing of the Transaction, David A. Arledge (Chair), James J. Blanchard and George K. Petty will be retiring from the Enbridge board while F. Anthony Comper, Austin A. Adams, Joseph Alvarado, Peter B. Hamilton, Miranda C. Hubbs and Michael G. Morris will be retiring from the Spectra Energy board. Both Mr. Monaco and Mr. Ebel thank those retiring board members for their contributions to the success of their respective companies. "We're grateful to those retiring board members from the two companies for their leadership, dedication, and guidance. They have provided great stewardship to help build the two very strong organizations that we are combining."
Mr. Monaco added that he looks forward to welcoming Spectra Energy employees to Enbridge. "We're bringing together two exceptional teams with strong values and a shared approach to safety, our stakeholders and our communities. We will move forward together, building from our proven strengths to position Enbridge to deliver infrastructure growth opportunities for our customers and continue to create value for our shareholders."
As previously announced, the headquarters of the combined company will be in Calgary, Alberta. Houston, Texas, will be the combined company's gas pipelines business unit center; Edmonton, Alberta, will remain the business unit center for liquids pipelines, with the business unit centers for gas distribution continuing to be based in Ontario. The combined company at close will have approximately 17,000 employees.
Dividends and Stock Listings
Spectra Energy will make its final common share dividend payment on March 1, 2017, to Spectra shareholders of record on February 15, 2017. In January, Enbridge announced a 10 percent increase in its quarterly common share dividend payable on March 1, 2017, to shareholders of record on February 15, 2017. It is expected that the first quarterly common share dividend post-combination will be payable on June 1, 2017, subject to board approval, and is expected to include a further increase to bring the aggregate increase in Enbridge's quarterly dividend to approximately 15 percent above the prevailing quarterly rate in 2016.
Trading in shares of Spectra Energy on the New York Stock Exchange (NYSE) will be suspended effective as of the opening of trading on February 27, 2017. In connection with the completion of the Transaction, the shares of common stock of Spectra Energy will be delisted from the NYSE and will be de-registered under the U.S. Securities Exchange Act of 1934. Common shares of Enbridge will continue to trade on both the NYSE and the Toronto Stock Exchange under the symbol "ENB".
Enbridge Energy Partners, L.P. (NYSE: EEP) and Spectra Energy Partners, LP (NYSE: SEP) will continue to be publicly traded partnerships headquartered in Houston, Texas. Enbridge Income Fund Holdings Inc. (TSX: ENF) will remain a publicly traded corporation headquartered in Calgary, Alberta. At Transaction closing, Midcoast Energy Partners, L.P. (NYSE: MEP)(Midcoast) will be a publicly traded partnership headquartered in Houston; however as announced on January 27, 2017, all of the outstanding publicly held common units of Midcoast are expected to be acquired by an Enbridge affiliate during the second quarter of 2017 and Midcoast would cease to be a publicly listed entity at that time.
About Enbridge Inc.
Enbridge, a Canadian company, exists to fuel people's quality of life, and has done so for more than 65 years. A North American leader in delivering energy, Enbridge has been ranked on the Global 100 Most Sustainable Corporations index for the past eight years. Enbridge operates the world's longest crude oil and liquids transportation system across Canada and the United States and has a significant and growing involvement in natural gas gathering, transmission and midstream business, as well as an increasing involvement in power transmission. Enbridge owns and operates Canada's largest natural gas distribution company, serving residential, commercial and industrial customers in Ontario, Quebec, New Brunswick and New York State. Enbridge has interests in approximately 2,500 MW of net renewable and alternative generating capacity, and continues to expand into wind, solar and geothermal power. Enbridge employs approximately 9,200 people, primarily in Canada and the United States and has been ranked 15 times on the annual Canada's Top 100 Employers list, including the 2017 index. Enbridge's common shares trade on the Toronto and New York stock exchanges under the symbol ENB. For more information, visit www.enbridge.com.
ABOUT SPECTRA ENERGY CORP
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include approximately 21,000 miles of natural gas and crude oil pipelines; approximately 300 billion cubic feet of natural gas storage; 5.6 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners, LP (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, LLC, which is the general partner of DCP Midstream, LP (NYSE: DCP), the largest natural gas liquids producer and the largest natural gas processor in the United States, and the largest gathering and processing master limited partnership in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
FORWARD-LOOKING INFORMATION
This news release includes certain forward looking statements and information (FLI) to provide Enbridge and Spectra Energy shareholders and potential investors with information about Enbridge, Spectra Energy and their respective subsidiaries and affiliates, including each company's management's respective assessment of Enbridge, Spectra Energy and their respective subsidiaries' future plans and operations, which FLI may not be appropriate for other purposes. FLI is typically identified by words such as "anticipate", "expect", "project", "estimate", "forecast", "plan", "intend", "target", "believe", "likely" and similar words suggesting future outcomes or statements regarding an outlook. All statements other than statements of historical fact may be FLI. In particular, this news release contains FLI pertaining to, but not limited to, information with respect to the following: the Transaction; the combined company's scale, financial flexibility and growth program; future business prospects and performance; annual cost, revenue and financing benefits; the expected ACFFO per share growth; future shareholder returns; annual dividend growth and anticipated dividend increases and payment dates; payout of distributable cash flow; financial strength and ability to fund capital program and compete for growth projects; credit ratings; run-rate and tax synergies; potential asset dispositions; leadership and governance structure; head office and business center locations; delisting and de-registration of the common stock of Spectra Energy; the proposed merger of Midcoast with an indirect wholly-owned subsidiary of Enbridge; and investor communications plans.
Although we believe that the FLI is reasonable based on the information available today and processes used to prepare it, such statements are not guarantees of future performance and you are cautioned against placing undue reliance on FLI. By its nature, FLI involves a variety of assumptions, which are based upon factors that may be difficult to predict and that may involve known and unknown risks and uncertainties and other factors which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by these FLI, including, but not limited to, the following: the realization of anticipated benefits and synergies of the Transaction and the timing thereof; the success of integration plans; the focus of management time and attention on the Transaction and other disruptions arising from the Transaction; expected future ACFFO; estimated future dividends; financial strength and flexibility; debt and equity market conditions, including the ability to access capital markets on favourable terms or at all; cost of debt and equity capital; expected supply and demand for crude oil, natural gas, natural gas liquids and renewable energy; prices of crude oil, natural gas, natural gas liquids and renewable energy; economic and competitive conditions; expected exchange rates; inflation; interest rates; changes in tax laws and tax rates; credit ratings; completion of growth projects; anticipated in-service dates; capital project funding; success of hedging activities; the ability of management of Enbridge, its subsidiaries and affiliates to execute key priorities, including those in connection with the Transaction and the proposed merger of Midcoast with an indirect wholly-owned subsidiary of Enbridge; availability and price of labour and construction materials; operational performance and reliability; customer, shareholder, regulatory and other stakeholder approvals and support; regulatory and legislative decisions and actions; public opinion; and weather. We caution that the foregoing list of factors is not exhaustive. Additional information about these and other assumptions, risks and uncertainties can be found in applicable filings with Canadian and U.S. securities regulators, including any proxy statement, prospectus or registration statement filed in connection with the Transaction. Due to the interdependencies and correlation of these factors, as well as other factors, the impact of any one assumption, risk or uncertainty on FLI cannot be determined with certainty.
Except to the extent required by law, we assume no obligation to publicly update or revise any FLI, whether as a result of new information, future events or otherwise. All FLI in this news release is expressly qualified in its entirety by these cautionary statements.
NON-GAAP MEASURES
This news release makes reference to non-GAAP measures, including ACFFO and ACFFO per share. ACFFO is defined as cash flow provided by operating activities before changes in operating assets and liabilities (including changes in environmental liabilities) less distributions to non-controlling interests and redeemable non-controlling interests, preference share dividends and maintenance capital expenditures, and further adjusted for unusual, non-recurring or non-operating factors. Management of Enbridge believes the presentation of these measures gives useful information to investors and shareholders as they provide increased transparency and insight into the performance of Enbridge. Management of Enbridge uses ACFFO to assess performance and to set its dividend payout target. These measures are not measures that have a standardized meaning prescribed by generally accepted accounting principles in the United States of America (U.S. GAAP) and may not be comparable with similar measures presented by other issuers. Additional information on Enbridge's use of non-GAAP measures can be found in Enbridge's Management's Discussion and Analysis (MD&A) available on Enbridge's website and www.sedar.com.
SOURCE Spectra Energy Corp; Enbridge Inc.
HOUSTON, Feb. 17, 2017 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) today reported net income of $327 million, including net income from controlling interests of $301 million, for the fourth quarter ended December 31, 2016, with diluted earnings per limited partner unit of $0.70. For the year, net income was $1.24 billion, including net income from controlling interests of $1.16 billion, with diluted earnings per limited partner unit of $2.84. The fourth quarter and yearly results included non-recurring special items of $36 million and $80 million, respectively, which decreased diluted earnings per limited partner unit by $0.11 for the quarter and $0.26 for the year.
Highlights:
Fourth quarter 2016 ongoing DCF was $330 million, compared with $260 million in the prior-year quarter. For the year, ongoing DCF was $1.3 billion, a $90 million increase from $1.21 billion in 2015. Distributions per limited partner unit for 2016 were $2.63, compared with $2.43 per limited partner unit in 2015.
For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $510 million, compared with $457 million in the prior-year quarter. For the year, ongoing EBITDA was $1.87 billion, compared with $1.83 billion in 2015.
Ongoing net income from controlling interests was $337 million for the quarter, or $0.81 diluted earnings per limited partner unit, compared with $305 million, or $0.82 diluted earnings per limited partner unit, in the prior-year quarter. Net income from controlling interests was $301 million for the quarter, or $0.70 diluted earnings per limited partner unit, compared with $304 million, or $0.82 diluted earnings per limited partner unit, in the prior-year quarter.
For the year, ongoing net income from controlling interests was $1.24 billion, or $3.10 diluted earnings per limited partner unit, compared with $1.24 billion, or $3.33 diluted earnings per limited partner unit, in 2015. Net income from controlling interests was $1.16 billion in 2016, or $2.84 diluted earnings per limited partner unit, compared with $1.23 billion, or $3.30 diluted earnings per limited partner unit, in 2015.
CEO COMMENT
"Spectra Energy Partners posted strong quarter and year-end results that continue to reflect our ability to generate solid cash flows and increased earnings. The expansion projects we placed into service in 2016 are driving additional value for our investors, as earlier this month we announced our 37th consecutive quarterly distribution increase," said Greg Ebel, chief executive officer, Spectra Energy Partners.
"While the General Partner of Spectra Energy Partners will change once the merger with Enbridge is complete, the stable underpinnings of our business will not. Spectra Energy Partners' strategic and competitive asset footprint – with virtually no direct commodity or volume risk, high-quality demand-pull customers, excellent liquidity, and access to favorable capital markets – will continue to generate steady cash flows. For 2017, we plan to continue our quarterly penny-and-a-quarter distribution increases while maintaining DCF coverage in our targeted range of 1.05 to 1.15 times."
SEGMENT RESULTS
U.S. Transmission
Ongoing EBITDA from U.S. Transmission was $466 million in fourth quarter 2016, compared with $413 million in fourth quarter 2015. Fourth quarter 2016 results reflect increased earnings from expansion projects placed into service in the second half of 2016, as well as higher Allowance for Funds Used During Construction (AFUDC), primarily from the Sabal Trail project. Fourth quarter 2016 results exclude a special item of $36 million for inspection and repair efforts associated with the Texas Eastern pipeline incident.
For the year 2016, ongoing EBITDA for U.S. Transmission was $1.72 billion, compared with $1.61 billion in 2015. The 2016 period excludes a special item of $80 million for inspection and repair efforts associated with the Texas Eastern pipeline incident. The 2015 period excludes a special item of $9 million related to a non-cash impairment of the Ozark Gas Gathering asset.
Liquids
Liquids EBITDA was $63 million in fourth quarter 2016, compared with $62 million in fourth quarter 2015. The increase is attributable to expansion revenue from the Express Enhancement project placed into service in October 2016, which was offset by the absence of equity earnings from Sand Hills and Southern Hills natural gas liquids (NGL) pipelines, which Spectra Energy Partners owned through October 2015.
For the year 2016, EBITDA for Liquids was $237 million, compared with $283 million in 2015.
Other
"Other" net expenses were $19 million in fourth quarter 2016, compared with $18 million in fourth quarter 2015.
For the year 2016, net expenses were $82 million, compared with $66 million in 2015.
Interest Expense
Interest expense was $59 million in fourth quarter 2016, compared with $60 million in fourth quarter 2015.
For the year 2016, interest expense was $224 million, compared with $239 million in 2015.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy Partners as of December 31, 2016, was $7.2 billion. Available liquidity at the end of the quarter was $2.1 billion. Spectra Energy Partners' capital expansion program continues to be funded through a combination of debt and equity.
Including contributions from noncontrolling interests of $743 million, total capital and investment spending for the year was approximately $1.8 billion, and consisted of about $1.5 billion of growth capital expenditures and about $268 million of maintenance capital expenditures. Maintenance capital expenditures include a $28 million special item related to the Texas Eastern pipeline incident.
In 2016, Spectra Energy Partners successfully completed an $800 million debt offering. Also in 2016, Spectra Energy Partners received net proceeds of $579 million through its "At the Market" (ATM) equity issuance program, with $106 million raised in the fourth quarter, plus an additional $501 million from equity issuances to its general partner.
Spectra Energy Partners expects to file its 2016 10-K with the Securities and Exchange Commission on or before March 1, 2017.
EXPANSION PROJECT UPDATES
Spectra Energy Partners' 2016 capital expansion program concluded with six projects placed into service, representing nearly $1.5 billion of capital expansion, including:
Projects Scheduled for 2017 In-Service
Construction on Sabal Trail continues to progress, and the project remains on track to be in-service during the first half of 2017.
The Access South, Adair Southwest, and Lebanon Extension projects commenced construction in January, and are scheduled to be placed in-service in the second half of this year.
The second phase of the Gulf Markets Expansion project continues to advance toward a second half of 2017 in-service date. The project has received all its regulatory permits and is under construction.
Atlantic Bridge received its FERC Certificate of Public Convenience and Necessity in January, and is targeting initial in-service in the fourth quarter of this year.
NEXUS and TEAL anticipate receiving their FERC certificates shortly after FERC again has a quorum. Subject to a prompt issuance of these certificates, the project team has a safe and environmentally responsible plan to place the facilities into service in the fourth quarter of 2017, within the prescribed construction windows, in order to meet shipper requirements. Infrastructure projects are a top priority for the new administration and we are confident it will take swift action to restore a FERC quorum.
Projects Scheduled for 2018 In-Service
The STEP project continues to target in-service in the second half of 2018.
The PennEast project continues to advance as well. FERC is expected to issue its Final Environmental Impact Statement (FEIS) in April, and the project is still targeting a late-2018 in-service date.
Projects Scheduled for 2019 In-Service
The Stratton Ridge project filed its FERC application earlier this month and remains on schedule for in-service in the first half of 2019.
Projects in Development
The Access Northeast project would help alleviate New England's well-documented issues of energy reliability and cost volatility. The project's partners continue to pursue a viable commercial and operational model to provide clean-burning natural gas to gas-fired electric generators in New England in support of the region's emission goals.
While the project has been in discussions on other contracting strategies, including participation among gas distribution companies, the complexity of any regional solution requires clarity among the New England states regarding the support and legal authority for electric distribution companies to contract for project capacity. When the states achieve alignment – in the form of consistent legislative or other legal authority supporting natural gas infrastructure for electric reliability – the project's partners remain able and committed to bringing Access Northeast to New England consumers.
With increasing reliance on natural gas for electric generation, this project provides a critical opportunity to improve New England's future energy reliability, cost volatility and competitiveness. Access Northeast's partners will continue working with state and federal agencies, as well as other stakeholders, to help close gaps in legal authority that are currently prohibiting the region from achieving its significant environmental goals, as the current system configuration requires the continued operation of older, higher emitting generation units, such as coal and oil plants.
Spectra Energy Partners conducted solicitations of interest on the Express Pipeline and Platte Pipeline in late 2016, and is currently conducting subsequent solicitations, which will close by the end of February.
Spectra Energy Partners has secured a commitment from an industrial market shipper in the STX Zone of its Texas Eastern system, and on February 15 launched a Texas-Louisiana Markets open season, which will close in early March, to solicit additional interest.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests as a measure to evaluate operations of the partnership. This measure is a non-GAAP financial measure as it represents net income from controlling interests, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measure for ongoing net income from controlling interests is net income from controlling interests.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Partners, LP. Ongoing EBITDA represents EBITDA, excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Partners, LP's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Partners, LP is net income.
The primary performance measures used by us to evaluate segment performance are segment EBITDA and Other EBITDA. We consider segment EBITDA and Other EBITDA, which are the GAAP measures used to report segment results, to be good indicators of each segment's operating performance from its continuing operations as they represent the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA and Other EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA as a measure of performance. Ongoing segment EBITDA is a non-GAAP financial measure, as it represents reported segment EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's ongoing performance across periods. The most directly comparable GAAP measure for ongoing segment EBITDA is segment EBITDA.
We also present Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the partnership to support distribution growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF, excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by distributions declared on partnership units. The most directly comparable GAAP measure for DCF coverage is Earnings-Per-Unit (EPU).
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other partnerships because other partnerships may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2015 Form 10-K, filed on February 25, 2016, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 5.6 million barrels of crude oil storage.
Spectra Energy Partners, LP | ||||||||||||||||
Quarterly Highlights | ||||||||||||||||
December 2016 | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except per-unit amounts) | ||||||||||||||||
Reported - These results include the impact of special items | ||||||||||||||||
Quarters Ended |
Years Ended | |||||||||||||||
December 31, |
December 31, | |||||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||||
INCOME |
||||||||||||||||
Operating Revenues |
$ |
663 |
$ |
634 |
$ |
2,533 |
$ |
2,455 |
||||||||
Total Reportable Segment EBITDA |
493 |
475 |
1,876 |
1,882 |
||||||||||||
Net Income - Controlling Interests |
301 |
304 |
1,161 |
1,225 |
||||||||||||
EBITDA BY BUSINESS SEGMENT |
||||||||||||||||
U.S. Transmission |
$ |
430 |
$ |
413 |
$ |
1,639 |
$ |
1,599 |
||||||||
Liquids |
63 |
62 |
237 |
283 |
||||||||||||
Total Reportable Segment EBITDA |
493 |
475 |
1,876 |
1,882 |
||||||||||||
Other EBITDA |
(19) |
(18) |
(82) |
(66) |
||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
474 |
$ |
457 |
$ |
1,794 |
$ |
1,816 |
||||||||
PARTNERS' CAPITAL |
||||||||||||||||
Declared Cash Distribution per Limited Partner Unit |
$ |
0.68875 |
$ |
0.63875 |
$ |
2.6800 |
$ |
2.4800 |
||||||||
Weighted Average Units Outstanding |
||||||||||||||||
Limited Partner Units |
307 |
290 |
299 |
296 |
||||||||||||
General Partner Units |
6 |
6 |
6 |
6 |
||||||||||||
DISTRIBUTABLE CASH FLOW |
||||||||||||||||
Distributable Cash Flow |
$ |
271 |
$ |
260 |
$ |
1,187 |
$ |
1,205 |
||||||||
Coverage Ratio |
1.1x |
1.2x | ||||||||||||||
CAPITAL AND INVESTMENT EXPENDITURES (a) |
||||||||||||||||
Capital expenditures - U.S. Transmission |
$ |
2,263 |
$ |
1,857 |
||||||||||||
Capital expenditures - Liquids |
71 |
26 |
||||||||||||||
Investment expenditures - Sand Hills/Southern Hills/SESH/Penn East/Nexus
|
251 |
124 |
||||||||||||||
Total |
$ |
2,585 |
$ |
2,007 |
||||||||||||
U.S. TRANSMISSION |
||||||||||||||||
Operating Revenues |
$ |
565 |
$ |
541 |
$ |
2,167 |
$ |
2,087 |
||||||||
Operating Expenses |
||||||||||||||||
Operating, Maintenance and Other |
207 |
184 |
779 |
680 |
||||||||||||
Other Income and Expenses |
72 |
56 |
251 |
192 |
||||||||||||
EBITDA |
$ |
430 |
$ |
413 |
$ |
1,639 |
$ |
1,599 |
||||||||
LIQUIDS |
||||||||||||||||
Operating Revenues |
$ |
98 |
$ |
93 |
$ |
366 |
$ |
368 |
||||||||
Operating Expenses |
||||||||||||||||
Operating, Maintenance and Other |
36 |
36 |
130 |
141 |
||||||||||||
Other Income and Expenses |
1 |
5 |
1 |
56 |
||||||||||||
EBITDA |
$ |
63 |
$ |
62 |
$ |
237 |
$ |
283 |
||||||||
Express Pipeline Revenue Receipts, MBbl/d (b) |
259 |
239 |
241 |
239 |
||||||||||||
Platte PADD II Deliveries, MBbl/d |
127 |
140 |
130 |
162 |
||||||||||||
Canadian Dollar Exchange Rate, Average |
1.33 |
1.34 |
1.33 |
1.28 |
||||||||||||
December 31, |
December 31, | |||||||||||||||
2016 |
2015 | |||||||||||||||
Debt |
$ |
7,213 |
$ |
6,604 |
||||||||||||
Actual Units Outstanding (c) |
315 |
291 |
||||||||||||||
(a) Excludes contributions received from noncontrolling interests of $641 million in 2016 and $216 million in 2015. Excludes sale of Sabal Trail interest of $102 million in 2016.
| ||||||||||||||||
(b) Thousand barrels per day. | ||||||||||||||||
(c) Increase in 2016 resulted from the "At the Market" equity issuance program and equity issuance to Spectra Energy Corp in April 2016. | ||||||||||||||||
Spectra Energy Partners, LP | ||||||||||||||||||
Condensed Consolidated Statements of Operations | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
(In millions) | ||||||||||||||||||
Reported - These results include the impact of special items | ||||||||||||||||||
Quarters Ended |
Years Ended | |||||||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||||||
Operating Revenues |
$ |
663 |
$ |
634 |
$ |
2,533 |
$ |
2,455 |
||||||||||
Operating Expenses |
344 |
313 |
1,305 |
1,182 |
||||||||||||||
Operating Income |
319 |
321 |
1,228 |
1,273 |
||||||||||||||
Other Income and Expenses |
72 |
60 |
253 |
243 |
||||||||||||||
Interest Expense |
59 |
60 |
224 |
239 |
||||||||||||||
Earnings Before Income Taxes |
332 |
321 |
1,257 |
1,277 |
||||||||||||||
Income Tax Expense |
5 |
4 |
18 |
12 |
||||||||||||||
Net Income |
327 |
317 |
1,239 |
1,265 |
||||||||||||||
Net Income - Noncontrolling Interests |
26 |
13 |
78 |
40 |
||||||||||||||
Net Income - Controlling Interests |
$ |
301 |
$ |
304 |
$ |
1,161 |
$ |
1,225 |
Spectra Energy Partners, LP | |||||||||||
Condensed Consolidated Balance Sheets | |||||||||||
(Unaudited) | |||||||||||
(In millions) | |||||||||||
December 31, |
December 31, | ||||||||||
2016 |
2015 | ||||||||||
ASSETS |
|||||||||||
Current Assets |
$ |
660 |
$ |
544 |
|||||||
Investments and Other Assets |
4,469 |
4,180 |
|||||||||
Net Property, Plant and Equipment |
16,092 |
13,837 |
|||||||||
Regulatory Assets and Deferred Debits |
385 |
290 |
|||||||||
Total Assets |
$ |
21,606 |
$ |
18,851 |
|||||||
LIABILITIES AND EQUITY |
|||||||||||
Current Liabilities |
$ |
1,779 |
$ |
1,471 |
|||||||
Long-term Debt |
6,223 |
5,845 |
|||||||||
Deferred Credits and Other Liabilities |
200 |
189 |
|||||||||
Equity |
13,404 |
11,346 |
|||||||||
Total Liabilities and Equity |
$ |
21,606 |
$ |
18,851 |
|||||||
Spectra Energy Partners, LP | |||||||||||
Distributable Cash Flow | |||||||||||
(Unaudited) | |||||||||||
(Dollars in Millions, except where noted)
Reported – These results include the impact of special items | |||||||||||
Quarters Ended |
Years Ended |
||||||||||
2016 |
2015 |
2016 |
2015 |
||||||||
Net Income |
$ 327 |
$ 317 |
$ 1,239 |
$ 1,265 |
|||||||
Add: |
|||||||||||
Interest expense |
59 |
60 |
224 |
239 |
|||||||
Income tax expense |
5 |
4 |
18 |
12 |
|||||||
Depreciation and amortization |
82 |
75 |
314 |
295 |
|||||||
Foreign currency loss |
1 |
1 |
1 |
6 |
|||||||
Less: |
|||||||||||
Third party interest income |
- |
- |
2 |
1 |
|||||||
EBITDA |
474 |
457 |
1,794 |
1,816 |
|||||||
Add: |
|||||||||||
Earnings from equity investments |
(35) |
(33) |
(127) |
(167) |
|||||||
Distributions from equity investments (a) |
28 |
24 |
160 |
207 |
|||||||
Non-cash impairment at Ozark Gas Gathering |
- |
- |
- |
9 |
|||||||
Other |
1 |
4 |
13 |
12 |
|||||||
Less: |
|||||||||||
Interest expense |
59 |
60 |
224 |
239 |
|||||||
Equity AFUDC |
37 |
26 |
121 |
76 |
|||||||
Net cash paid for income taxes |
3 |
4 |
10 |
12 |
|||||||
Distributions to non-controlling interests |
8 |
8 |
30 |
31 |
|||||||
Maintenance capital expenditures |
90 |
94 |
268 |
314 |
|||||||
Total Distributable Cash Flow |
$ 271 |
$ 260 |
$ 1,187 |
$ 1,205 |
|||||||
Distributions (b) |
$ 1,113 |
$ 976 |
|||||||||
Coverage - DCF/Distributions |
1.1X |
1.2X |
|||||||||
(a) Excludes $403 million of distributions for the twelve month period ended December 31, 2015. | |||||||||||
(b) Includes a $4 million reduction of distribution to Spectra Energy (as holder of incentive distribution rights) per quarter beginning in December 2015. |
Spectra Energy Partners, LP |
|||||||||||||||
Reported to Ongoing Earnings Reconciliation |
|||||||||||||||
December 2016 Quarter-to-Date |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In millions) |
|||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported Earnings |
Less: Special Items |
Ongoing Earnings |
||||||||||||
U.S. Transmission |
$ |
430 |
$ |
(36) |
A |
$ |
466 |
||||||||
Liquids |
63 |
— |
63 |
||||||||||||
Total Reportable Segment EBITDA |
493 |
(36) |
529 |
||||||||||||
Other |
(19) |
— |
(19) |
||||||||||||
Total Reportable Segment and other EBITDA |
$ |
474 |
$ |
(36) |
$ |
510 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
474 |
$ |
(36) |
$ |
510 |
|||||||||
Depreciation and Amortization |
(82) |
— |
(82) |
||||||||||||
Interest Expense |
(59) |
— |
(59) |
||||||||||||
Other Income and Expenses |
(1) |
— |
(1) |
||||||||||||
Income Tax Expense |
(5) |
— |
(5) |
||||||||||||
Total Net Income |
327 |
(36) |
363 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(26) |
— |
(26) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
301 |
$ |
(36) |
$ |
337 |
|||||||||
A - Inspection and repair costs related to Texas Eastern pipeline incident in Pennsylvania.
|
Spectra Energy Partners, LP |
|||||||||||||||
Reported to Ongoing Earnings Reconciliation |
|||||||||||||||
December 2015 Quarter-to-Date |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In millions) |
|||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported Earnings |
Less: Special Items |
Ongoing Earnings |
||||||||||||
U.S. Transmission |
$ |
413 |
$ |
— |
$ |
413 |
|||||||||
Liquids |
62 |
— |
62 |
||||||||||||
Total Reportable Segment EBITDA |
475 |
— |
475 |
||||||||||||
Other |
(18) |
— |
(18) |
||||||||||||
Total Reportable Segment and other EBITDA |
$ |
457 |
$ |
— |
$ |
457 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
457 |
$ |
— |
$ |
457 |
|||||||||
Depreciation and Amortization |
(75) |
— |
(75) |
||||||||||||
Interest Expense |
(60) |
(1) |
A |
(59) |
|||||||||||
Other Income and Expenses |
(1) |
— |
(1) |
||||||||||||
Income Tax Expense |
(4) |
— |
(4) |
||||||||||||
Total Net Income |
317 |
(1) |
318 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(13) |
— |
(13) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
304 |
$ |
(1) |
$ |
305 |
|||||||||
A - Net write-off of regulatory assets and liabilities at Ozark Gas Transmission due to discontinuance of regulatory accounting. |
Spectra Energy Partners, LP |
|||||||||||||||
Reported to Ongoing Earnings Reconciliation |
|||||||||||||||
December 2016 Year-to-Date |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In millions) |
|||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported Earnings |
Less: Special Items |
Ongoing Earnings |
||||||||||||
U.S. Transmission |
$ |
1,639 |
$ |
(80) |
A |
$ |
1,719 |
||||||||
Liquids |
237 |
— |
237 |
||||||||||||
Total Reportable Segment EBITDA |
1,876 |
(80) |
1,956 |
||||||||||||
Other |
(82) |
— |
(82) |
||||||||||||
Total Reportable Segment and other EBITDA |
$ |
1,794 |
$ |
(80) |
$ |
1,874 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
1,794 |
$ |
(80) |
$ |
1,874 |
|||||||||
Depreciation and Amortization |
(314) |
— |
(314) |
||||||||||||
Interest Expense |
(224) |
— |
(224) |
||||||||||||
Other Income and Expenses |
1 |
— |
1 |
||||||||||||
Income Tax Expense |
(18) |
— |
(18) |
||||||||||||
Total Net Income |
1,239 |
(80) |
1,319 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(78) |
— |
(78) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
1,161 |
$ |
(80) |
$ |
1,241 |
|||||||||
A - Inspection and repair costs related to Texas Eastern pipeline incident in Pennsylvania.
|
Spectra Energy Partners, LP |
|||||||||||||||
Reported to Ongoing Earnings Reconciliation |
|||||||||||||||
December 2015 Year-to-Date |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In millions) |
|||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported Earnings |
Less: Special Items |
Ongoing Earnings |
||||||||||||
U.S. Transmission |
$ |
1,599 |
$ |
(9) |
A |
$ |
1,608 |
||||||||
Liquids |
283 |
— |
283 |
||||||||||||
Total Reportable Segment EBITDA |
1,882 |
(9) |
1,891 |
||||||||||||
Other |
(66) |
— |
(66) |
||||||||||||
Total Reportable Segment and other EBITDA |
$ |
1,816 |
$ |
(9) |
$ |
1,825 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
1,816 |
$ |
(9) |
$ |
1,825 |
|||||||||
Depreciation and Amortization |
(295) |
— |
(295) |
||||||||||||
Interest Expense |
(239) |
(1) |
B |
(238) |
|||||||||||
Other Income and Expenses |
(5) |
— |
(5) |
||||||||||||
Income Tax Expense |
(12) |
— |
(12) |
||||||||||||
Total Net Income |
1,265 |
(10) |
1,275 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(40) |
— |
(40) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
1,225 |
$ |
(10) |
$ |
1,235 |
|||||||||
A - Non-cash impairment at Ozark Gas Gathering.
|
|||||||||||||||
B - Net write-off of regulatory assets and liabilities at Ozark Gas Transmission due to discontinuance of regulatory accounting. |
Spectra Energy Partners, LP |
|||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation |
|||||||||||||
Unaudited |
|||||||||||||
(In millions) |
|||||||||||||
Quarters Ended | |||||||||||||
December 31, 2016 |
December 31, 2015 | ||||||||||||
Reported |
Less: |
Ongoing |
Reported |
Less: |
Ongoing | ||||||||
Net Income |
$ 327 |
$ (36) |
$ 363 |
$ 317 |
$ (1) |
$ 318 | |||||||
Add: |
|||||||||||||
Interest expense |
59 |
- |
59 |
60 |
1 |
59 | |||||||
Income tax expense |
5 |
- |
5 |
4 |
- |
4 | |||||||
Depreciation and amortization |
82 |
- |
82 |
75 |
- |
75 | |||||||
Foreign currency loss |
1 |
- |
1 |
1 |
- |
1 | |||||||
Less: |
|||||||||||||
Third party interest income |
- |
- |
- |
- |
- |
- | |||||||
EBITDA |
474 |
(36) |
510 |
457 |
- |
457 | |||||||
Add: |
|||||||||||||
Earnings from equity investments |
(35) |
- |
(35) |
(33) |
- |
(33) | |||||||
Distributions from equity investments |
28 |
- |
28 |
24 |
- |
24 | |||||||
Other |
1 |
- |
1 |
4 |
1 |
3 | |||||||
Less: |
|||||||||||||
Interest expense |
59 |
- |
59 |
60 |
1 |
59 | |||||||
Equity AFUDC |
37 |
- |
37 |
26 |
- |
26 | |||||||
Net cash paid for income taxes |
3 |
- |
3 |
4 |
- |
4 | |||||||
Distributions to non-controlling interests |
8 |
- |
8 |
8 |
- |
8 | |||||||
Maintenance capital expenditures |
90 |
23 |
67 |
94 |
- |
94 | |||||||
Total Distributable Cash Flow |
$ 271 |
$ (59) |
$ 330 |
$ 260 |
$ - |
$ 260 |
Spectra Energy Partners, LP | ||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | ||||||||||||
Unaudited | ||||||||||||
(In millions) | ||||||||||||
Years Ended | ||||||||||||
December 31, 2016 |
December 31, 2015 | |||||||||||
Reported |
Less: |
Ongoing |
Reported |
Less: |
Ongoing | |||||||
Net Income |
$ 1,239 |
$ (80) |
$ 1,319 |
$ 1,265 |
$ (10) |
$ 1,275 | ||||||
Add: |
||||||||||||
Interest expense |
224 |
- |
224 |
239 |
1 |
238 | ||||||
Income tax expense |
18 |
- |
18 |
12 |
- |
12 | ||||||
Depreciation and amortization |
314 |
- |
314 |
295 |
- |
295 | ||||||
Foreign currency loss |
1 |
- |
1 |
6 |
- |
6 | ||||||
Less: |
||||||||||||
Third party interest income |
2 |
- |
2 |
1 |
- |
1 | ||||||
EBITDA |
1,794 |
(80) |
1,874 |
1,816 |
(9) |
1,825 | ||||||
Add: |
||||||||||||
Earnings from equity investments |
(127) |
- |
(127) |
(167) |
- |
(167) | ||||||
Distributions from equity investments |
160 |
- |
160 |
207 |
- |
207 | ||||||
Non-cash impairment at Ozark Gas Gathering |
- |
- |
- |
9 |
9 |
- | ||||||
Other |
13 |
- |
13 |
12 |
1 |
11 | ||||||
Less: |
||||||||||||
Interest expense |
224 |
- |
224 |
239 |
1 |
238 | ||||||
Equity AFUDC |
121 |
- |
121 |
76 |
- |
76 | ||||||
Net cash paid for income taxes |
10 |
- |
10 |
12 |
- |
12 | ||||||
Distributions to non-controlling interests |
30 |
- |
30 |
31 |
- |
31 | ||||||
Maintenance capital expenditures |
268 |
28 |
240 |
314 |
- |
314 | ||||||
Total Distributable Cash Flow |
$ 1,187 |
$ (108) |
$ 1,295 |
$ 1,205 |
$ - |
$ 1,205 | ||||||
Distributions |
1,113 |
1,113 |
976 |
976 | ||||||||
Coverage - DCF/Distributions |
1.1X |
1.2X |
1.2X |
1.2X |
SOURCE Spectra Energy Partners, LP
HOUSTON, Feb. 17, 2017 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) today reported net income of $208 million, including net income from controlling interests of $115 million, for the fourth quarter ended December 31, 2016, with diluted earnings per share of $0.16. For the year, net income was $1.02 billion, including net income from controlling interests of $693 million, with diluted earnings per share of $1.00. The fourth quarter and full-year results included non-recurring special items of $127 million and $243 million, which had income tax effects of $32 million and $88 million, respectively, and decreased diluted earnings per share by $0.13 for the quarter and $0.19 for the year.
Highlights:
For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $742 million, compared with $672 million in the prior-year quarter. For the year, ongoing EBITDA was $2.85 billion, compared with $2.75 billion in 2015.
Ongoing DCF for the quarter was $309 million, compared with $201 million in the same quarter last year, and was $1.38 billion for the year, up from $1.29 billion in 2015.
For the quarter, ongoing net income from controlling interests was $202 million, or $0.29 diluted earnings per share, compared with $189 million, or $0.28 diluted earnings per share, in fourth quarter 2015. Net income from controlling interests was $115 million, or $0.16 diluted earnings per share, compared with $(263) million, or $(0.39) diluted earnings per share, in fourth quarter 2015.
For the year, ongoing net income from controlling interests was $829 million, or $1.19 diluted earnings per share, compared with $775 million, or $1.15 diluted earnings per share, in 2015. Net income from controlling interests was $693 million, or $1.00 diluted earnings per share, compared with $196 million, or $0.29 diluted earnings per share, in 2015.
CEO COMMENT
"2016 was a transformational year for Spectra Energy. I'm proud of all we accomplished, but most importantly that we continued our track record of delivering on our commitments to all our stakeholders," said Greg Ebel, chief executive officer, Spectra Energy.
"We delivered strong DCF and dividend coverage. We successfully executed our 2016 growth plan by placing $2 billion of projects into service, and as an added benefit to our customers and investors, placed some of those projects into service ahead of schedule. We added $2.3 billion of projects to our execution backlog, including the $1.5 billion Valley Crossing Pipeline project. DCP Midstream surpassed its 35-cent NGL break-even target, paving the way for the restructuring and simplification it announced in January 2017. And through all this activity we also maintained a healthy balance sheet.
"Our achievements and accomplishments in 2016, coupled with those of the past decade, have positioned us well for 2017 and beyond, as we move closer to completing our combination with Enbridge, which we expect to occur in the first quarter of this year. While we announced our 14-cent per share annual dividend increase for 2017, the combination with Enbridge will greatly accelerate our dividend growth, from 8 percent annually to 15 percent in 2017 and an expected 10 to 12 percent annually through 2024.
"During these past 10 years, we've expanded our footprint, diversified our asset portfolio, reduced our risk profile and provided a dependable, attractive dividend, creating tremendous shareholder value in that process. We have proven to be a stable, disciplined and reliable investment. It has been an honor to serve as CEO for the past eight years, and I am proud of our company and the great people who have contributed to its success. As incoming chairman of the new Enbridge, I look forward to the company taking our next big step. I fully expect we will deliver even greater benefits to our investors, customers, communities and employees."
SEGMENT RESULTS
Spectra Energy Partners
Ongoing EBITDA from Spectra Energy Partners was $537 million in fourth quarter 2016, compared with $484 million in fourth quarter 2015. Fourth quarter 2016 ongoing results reflect increased earnings from expansion projects placed into service in the second half of 2016 in both the natural gas transmission and liquids businesses, as well as higher Allowance for Funds Used During Construction (AFUDC), primarily from the Sabal Trail project. These increases were offset by the absence of equity earnings from Sand Hills and Southern Hills natural gas liquids (NGL) pipelines, which Spectra Energy Partners owned through October 2015. Earnings from these NGL pipeline interests have been reflected in the Field Services segment. Fourth quarter 2016 results exclude a special item of $36 million for inspection and repair efforts associated with the Texas Eastern pipeline incident.
For the year 2016, ongoing EBITDA for Spectra Energy Partners was $2 billion, compared with $1.9 billion in 2015. The 2016 period excludes a special item of $80 million for inspection and repair efforts associated with the Texas Eastern pipeline incident. The 2015 period excludes a special item of $9 million related to a non-cash impairment of the Ozark Gas Gathering asset.
Distribution
Distribution EBITDA was $122 million in fourth quarter 2016, compared with $113 million in fourth quarter 2015. This increase was mainly due to incremental earnings from the Dawn-Parkway expansion projects and colder weather.
For the years 2016 and 2015, EBITDA for Distribution was $473 million.
Western Canada Transmission & Processing
Ongoing EBITDA from Western Canada Transmission & Processing was $105 million in fourth quarter 2016, compared with $123 million in fourth quarter 2015. The segment's ongoing results largely reflect lower gathering and processing revenues. Fourth quarter 2016 results exclude special items of $31 million, primarily from a non-cash loss on the sale of assets, as well as from continued contract demand credits net of insurance recoveries at our Grizzly Valley operations in British Columbia associated with significant flooding in June. Fourth quarter 2015 results exclude special items of $14 million for employee and overhead reductions and a non-cash asset impairment.
For the year 2016, ongoing EBITDA for Western Canada Transmission & Processing was $443 million, compared with $516 million in 2015. The 2016 period excludes special items of $56 million for contract demand credits net of insurance recoveries associated with flooding in British Columbia, employee and overhead reductions, and a non-cash loss on the sale of assets. The 2015 period excludes special items of $25 million related to employee and overhead reduction costs and a non-cash asset impairment.
Field Services
Ongoing EBITDA from Field Services was $(5) million in fourth quarter 2016, compared with $(36) million in fourth quarter 2015. The segment's ongoing results reflect favorable contract realignment efforts, stronger commodity prices, and asset growth, offset by lower volumes in certain geographic regions. Fourth quarter 2016 results exclude special items of $36 million, primarily reflecting income tax expense associated with the transaction converting a C-Corp subsidiary of DCP Midstream to an LLC, as well as transaction costs related to combining DCP Midstream and DCP Partners. The 2015 period excludes special items of $172 million, primarily from non-cash asset impairments. As a reminder, Spectra Energy's EBITDA from Field Services represents the company's 50 percent share of DCP Midstream's net income plus gains from DPM unit issuances.
For the year 2016, ongoing EBITDA for Field Services was $14 million, compared with $(106) million in 2015. The 2016 period excludes special items of $54 million, mainly from converting a C-Corp subsidiary of DCP Midstream to an LLC, transaction costs related to combining DCP Midstream and DCP Partners, and non-cash asset impairments. The 2015 period excludes $355 million in charges, primarily due to non-cash goodwill and asset impairments.
During the fourth quarters of 2016 and 2015, respectively, NGL prices averaged $0.55 per gallon versus $0.42 per gallon, NYMEX natural gas averaged $2.98 per million British thermal units (MMBtu) versus $2.27 per MMBtu, and crude oil averaged approximately $49 per barrel versus $42 per barrel.
On a full-year basis for 2016 and 2015, respectively, NGL prices averaged $0.46 per gallon versus $0.45 per gallon, NYMEX natural gas averaged $2.46 per MMBtu versus $2.66 per MMBtu and crude oil averaged approximately $43 per barrel versus $49 per barrel.
Other
Ongoing net expenses from "Other" were $17 million and $12 million in the fourth quarters of 2016 and 2015, respectively. Fourth quarter 2016 results exclude special items of $24 million for transaction costs related to the proposed merger with Enbridge and captive insurance claims related to the flooding in British Columbia. The 2015 period excludes a special item of $333 million related to non-cash goodwill impairments associated with the Westcoast Energy acquisition in 2002.
For the year 2016, ongoing net expenses from "Other" were $73 million, compared with $51 million in 2015. The 2016 period excludes special items of $53 million for transaction costs and self-insurance charges related to the Texas Eastern pipeline incident and flooding in British Columbia. The 2015 period excludes special items of $333 million related to non-cash goodwill impairments associated with the Westcoast Energy acquisition.
"Other" primarily consists of corporate expenses, including benefits and captive insurance.
Interest Expense
Interest expense was $157 million in fourth quarter 2016, compared with $156 million in fourth quarter 2015.
For the year 2016, interest expense was $594 million, compared with $636 million in 2015.
Income Tax Expense
Income tax expense was $56 million in fourth quarter 2016, compared with an income tax benefit of $3 million in fourth quarter 2015, with effective tax rates of 21 percent and 2 percent, respectively. Excluding the tax impacts of special items in both periods, income tax expense was $88 million in fourth quarter 2016, compared with $65 million in fourth quarter 2015, with effective tax rates of 23 percent and 20 percent, respectively. The higher income tax expense was primarily due to higher earnings.
For the year 2016, income tax expense was $216 million, compared with $161 million in 2015, with effective tax rates of 18 percent and 26 percent, respectively. Excluding the tax impacts of special items in both periods, income tax expense was $304 million in both 2016 and 2015, with effective tax rates of 21 percent and 23 percent, respectively.
Foreign Currency
Net income from controlling interests was lower by $2 million for the quarter and $10 million for the year due to the lower Canadian dollar.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy as of December 31, 2016, was $15.6 billion. Total Spectra Energy liquidity at the end of the quarter was $5.2 billion, including $2.1 billion of available liquidity at Spectra Energy Partners.
Including contributions from noncontrolling interests of $743 million, total capital and investment spending for the year was $3.1 billion, and consisted of about $2.5 billion of growth capital expenditures and $613 million of maintenance capital expenditures. Maintenance capital expenditures include special items of $28 million related to the Texas Eastern pipeline incident and $7 million related to flooding in British Columbia.
Spectra Energy expects to file its 2016 10-K with the SEC on or before March 1, 2017.
EFFECTS OF SPECIAL ITEMS
Fourth Quarter 2016 | |||||
($MM) |
Segment |
EBITDA |
Income Tax |
Net |
DCF |
Ongoing |
$ 742 |
$ (88) |
$ 202 |
$ 309 | |
Adjustments related to Special Items |
|||||
Effects of Texas Eastern pipeline incident |
SEP |
$ (36) |
$ 10 |
$ (18) (2) |
$ (59) (3) |
Effects of flooding in British Columbia |
W. Canada |
(3) |
1 |
(2) |
(10) (3) |
Loss on sale of assets and asset impairment |
W. Canada |
(28) |
7 |
(21) |
- |
Transaction costs related to combining DCP Midstream and DCP Partners |
Field Services |
(14) |
5 |
(9) |
- |
Asset impairment and write-off |
Field Services |
(1) |
1 |
- |
- |
Transaction converting a DCP Midstream entity from C Corp to LLC |
Field Services |
(21) |
8 |
(13) |
- |
Captive insurance claims related to British Columbia flood |
Other |
(5) |
2 |
(3) |
(5) |
Taxes related to non-deductible excess compensation |
Other |
- |
(7) |
(7) |
- |
Transaction costs and prefunding associated with merger |
Other |
(19) |
5 |
(14) |
(65) |
Total Special Items |
$ (127) |
$ 32 |
$ (87) |
$ (139) | |
Reported |
$ 615 |
$ (56) |
$ 115 |
$ 170 | |
(1) Represents net income from controlling interests | |||||
(2) Net of non-controlling interests impact of $8 million | |||||
(3) Includes maintenance capital expenditures of $23 million and $7 million related to Texas Eastern pipeline incident and flooding in British Columbia, respectively |
For the Year 2016 | |||||
($MM) |
Segment |
EBITDA |
Income Tax |
Net |
DCF |
Ongoing |
$ 2,846 |
$ (304) |
$ 829 |
$ 1,383 | |
Adjustments related to Special Items |
|||||
Effects of Texas Eastern pipeline incident |
SEP |
$ (80) |
$ 22 |
$ (39) (2) |
$ (108) (3) |
Effects of flooding in British Columbia |
W. Canada |
(19) |
5 |
(14) |
(26) (3) |
Loss on sale of assets and asset impairment |
W. Canada |
(28) |
7 |
(21) |
- |
Employee and overhead reduction costs |
W. Canada |
(9) |
2 |
(7) |
(9) |
Tax benefit on Empress transaction |
W. Canada |
- |
27 |
27 |
- |
Transaction costs related to combining DCP Midstream and DCP Partners |
Field Services |
(14) |
5 |
(9) |
- |
Employee and overhead reduction costs |
Field Services |
(7) |
3 |
(4) |
- |
Asset impairments and net loss on sale of assets |
Field Services |
(12) |
5 |
(7) |
- |
Transaction converting a DCP Midstream entity from C Corp to LLC |
Field Services |
(21) |
8 |
(13) |
- |
Captive insurance related to Texas Eastern pipeline incident and British Columbia flood |
Other |
(15) |
6 |
(9) |
(15) |
Taxes related to non-deductible excess compensation |
Other |
- |
(7) |
(7) |
- |
Transaction costs and prefunding associated with merger |
Other |
(38) |
5 |
(33) |
(84) |
Total Special Items |
$ (243) |
$ 88 |
$ (136) |
$ (242) | |
Reported |
$ 2,603 |
$ (216) |
$ 693 |
$ 1,141 | |
(1) Represents net income from controlling interests | |||||
(2) Net of non-controlling interests impact of $19 million | |||||
(3) Includes maintenance capital expenditures of $28 million and $7 million related to Texas Eastern pipeline incident and flooding in British Columbia, respectively |
EXPANSION PROJECT UPDATES
For the period 2013-2016, the company has:
Spectra Energy's 2016 capital expansion program concluded with eight projects placed into service, representing $2 billion of capital expansion, including:
Projects Scheduled for 2017 In-Service
Construction on Sabal Trail continues to progress, and the project remains on track to be in-service during the first half of 2017.
The Access South, Adair Southwest, and Lebanon Extension projects commenced construction in January, and are scheduled to be placed in-service in the second half of this year.
The second phase of the Gulf Markets Expansion project continues to advance toward a second half of 2017 in-service date. The project has received all its regulatory permits and is under construction.
Atlantic Bridge received its FERC Certificate of Public Convenience and Necessity in January, and is targeting initial in-service in the fourth quarter of this year.
NEXUS and TEAL anticipate receiving their FERC certificates shortly after FERC again has a quorum. Subject to a prompt issuance of these certificates, the project team has a safe and environmentally responsible plan to place the facilities into service in the fourth quarter of 2017, within the prescribed construction windows, in order to meet shipper requirements. Infrastructure projects are a top priority for the new administration and we are confident it will take swift action to restore a FERC quorum.
Projects in Western Canada continue to advance toward their respective in-service dates, specifically Jackfish Lake (first half of this year) as well as RAM and High Pine (second half of this year). All three projects have received their regulatory permits, and are under construction.
At Union Gas, both the 2017 Dawn-Parkway expansion and the Panhandle Reinforcement projects remain on schedule to be placed in-service in the second half of this year.
In January 2017, DCP Midstream announced a number of significant expansion projects, including compression and infrastructure expansions that will add approximately 40 million cubic feet per day (MMcf/d) of incremental capacity by the summer of 2017 in the DJ Basin, and an 85,000 barrel-per-day expansion of the Sand Hills NGL pipeline expected to come online in the fourth quarter of 2017.
Projects Scheduled for 2018 In-Service
The Bayway Lateral project continues to progress toward an in-service date in the first half of 2018, as does Western Canada's Wyndwood project, while the STEP project continues to target in-service in the second half of 2018.
The Valley Crossing Pipeline is advancing through the regulatory process and continues to target an in-service date in the second half of 2018. Construction is expected to begin in the second quarter of 2017.
The PennEast project continues to advance as well. FERC is expected to issue its Final Environmental Impact Statement (FEIS) in April, and the project is still targeting a late-2018 in-service date.
New to the company's project portfolio this quarter is the Spruce Ridge project, a $500 million supply-push project in Western Canada that is expected to go into service in the second half of 2018. The project involves a 400 MMcf/d expansion of the T-North transmission system, as well as pipeline looping and additional compression, to facilitate T-North producers' access to downstream markets.
DCP Midstream also announced a 200 MMcf/d cryogenic natural gas processing plant in the DJ Basin that is projected to be in-service by the end of 2018.
Projects Scheduled for 2019 In-Service
The Stratton Ridge project filed its FERC application earlier this month and remains on schedule for in-service in the first half of 2019.
Projects in Development
The Access Northeast project would help alleviate New England's well-documented issues of energy reliability and cost volatility. The project's partners continue to pursue a viable commercial and operational model to provide clean-burning natural gas to gas-fired electric generators in New England in support of the region's emission goals.
While the project has been in discussions on other contracting strategies, including participation among gas distribution companies, the complexity of any regional solution requires clarity among the New England states regarding the support and legal authority for electric distribution companies to contract for project capacity. When the states achieve alignment – in the form of consistent legislative or other legal authority supporting natural gas infrastructure for electric reliability – the project's partners remain able and committed to bringing Access Northeast to New England consumers.
With increasing reliance on natural gas for electric generation, this project provides a critical opportunity to improve New England's future energy reliability, cost volatility and competitiveness. Access Northeast's partners will continue working with state and federal agencies, as well as other stakeholders, to help close gaps in legal authority that are currently prohibiting the region from achieving its significant environmental goals, as the current system configuration requires the continued operation of older, higher emitting generation units, such as coal and oil plants.
Spectra Energy Partners conducted solicitations of interest on the Express Pipeline and Platte Pipeline in late 2016, and is currently conducting subsequent solicitations, which will close by the end of February.
Spectra Energy Partners has secured a commitment from an industrial market shipper in the STX Zone of its Texas Eastern system, and on February 15 launched a Texas-Louisiana Markets open season, which will close in early March, to solicit additional interest.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests and ongoing diluted EPS as measures to evaluate operations of the company. These measures are non-GAAP financial measures as they represent net income from controlling interests and diluted EPS, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests and ongoing diluted EPS provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measures for ongoing net income from controlling interests and ongoing diluted EPS are net income from controlling interests and diluted EPS.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Corp. Ongoing EBITDA represents EBITDA, excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Corp's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Corp is net income.
The primary performance measures used by us to evaluate segment performance are segment EBITDA and Other EBITDA. We consider segment EBITDA and Other EBITDA, which are the GAAP measures used to report segment results, to be good indicators of each segment's operating performance from its continuing operations as they represent the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA and Other EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA and ongoing Other EBITDA (net expenses) as measures of performance. Ongoing segment EBITDA and ongoing Other EBITDA are non-GAAP financial measures, as they represent segment EBITDA and Other EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA and ongoing Other EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's or Other's ongoing performance across periods. The most directly comparable GAAP measures for ongoing segment EBITDA and ongoing Other EBITDA are segment EBITDA and Other EBITDA.
We also present Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the company to support dividend growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF, excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by dividends declared on common stock. The most directly comparable GAAP measure for DCF coverage is EPS.
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other companies because other companies may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2015 Form 10-K, filed on February 25, 2016, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include approximately 21,000 miles of natural gas and crude oil pipelines; approximately 300 billion cubic feet of natural gas storage; 5.6 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners, LP (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, LLC, which is the general partner of DCP Midstream, LP (NYSE: DCP), the largest natural gas liquids producer and the largest natural gas processor in the United States, and the largest gathering and processing master limited partnership in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
Spectra Energy Corp | |||||||||||
Quarterly Highlights | |||||||||||
December 2016 | |||||||||||
(Unaudited) | |||||||||||
(In millions, except per-share amounts and where noted) | |||||||||||
Reported - These results include the impact of special items | |||||||||||
Quarters Ended |
Years Ended | ||||||||||
2016 |
2015 |
2016 |
2015 | ||||||||
COMMON STOCK DATA |
|||||||||||
Earnings (Loss) Per Share, Diluted |
$ |
0.16 |
$ |
(0.39) |
$ |
1.00 |
$ |
0.29 | |||
Dividends Per Share |
$ |
0.405 |
$ |
0.37 |
$ |
1.62 |
$ |
1.48 | |||
Weighted-Average Shares Outstanding, Diluted |
704 |
673 |
696 |
672 | |||||||
INCOME |
|||||||||||
Operating Revenues |
$ |
1,298 |
$ |
1,316 |
$ |
4,916 |
$ |
5,234 | |||
Total Reportable Segment EBITDA |
656 |
498 |
2,729 |
2,408 | |||||||
Net Income (Loss) - Controlling Interests |
115 |
(263) |
693 |
196 | |||||||
EBITDA BY BUSINESS SEGMENT |
|||||||||||
Spectra Energy Partners |
$ |
501 |
$ |
484 |
$ |
1,909 |
$ |
1,905 | |||
Distribution |
122 |
113 |
473 |
473 | |||||||
Western Canada Transmission & Processing |
74 |
109 |
387 |
491 | |||||||
Field Services |
(41) |
(208) |
(40) |
(461) | |||||||
Total Reportable Segment EBITDA |
656 |
498 |
2,729 |
2,408 | |||||||
Other EBITDA |
(41) |
(345) |
(126) |
(384) | |||||||
Total Reportable Segment and Other EBITDA |
$ |
615 |
$ |
153 |
$ |
2,603 |
$ |
2,024 | |||
DISTRIBUTABLE CASH FLOW |
|||||||||||
Distributable Cash Flow |
$ |
170 |
$ |
194 |
$ |
1,141 |
$ |
1,274 | |||
Coverage Ratio |
1.0x |
1.3x | |||||||||
CAPITAL AND INVESTMENT EXPENDITURES |
|||||||||||
Spectra Energy Partners (a) |
$ |
2,585 |
$ |
2,007 | |||||||
Distribution |
788 |
544 | |||||||||
Western Canada Transmission & Processing |
410 |
360 | |||||||||
Other |
91 |
61 | |||||||||
Total Capital and Investment Expenditures (a) |
$ |
3,874 |
$ |
2,972 | |||||||
Expansion and Investment (a) |
$ |
3,261 |
$ |
2,281 | |||||||
Maintenance and Other |
613 |
691 | |||||||||
Total Capital and Investment Expenditures (a) |
$ |
3,874 |
$ |
2,972 | |||||||
December 31, | |||||||||||
2016 |
2015 | ||||||||||
CAPITALIZATION |
|||||||||||
Common Equity - Controlling Interests |
25.8% |
26.6% | |||||||||
Noncontrolling Interests and Preferred Stock |
17.8% |
13.6% | |||||||||
Total Debt |
56.4% |
59.8% | |||||||||
Total Debt |
$ |
15,628 |
$ |
14,656 | |||||||
Book Value Per Share (b) |
$ |
10.20 |
$ |
9.73 | |||||||
Actual Shares Outstanding (c) |
702 |
671 | |||||||||
(a) Excludes contributions received from noncontrolling interests of $641 million in 2016 and $216 million in 2015. | |||||||||||
(b) Represents controlling interests. | |||||||||||
(c) Increase in 2016 resulted from a newly initiated "At the Market" equity issuance program in March 2016 and equity |
Spectra Energy Corp | ||||||||||||||||
Quarterly Highlights | ||||||||||||||||
December 2016 | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except where noted) | ||||||||||||||||
Reported - These results include the impact of special items | ||||||||||||||||
Quarters Ended December 31, |
Years Ended December 31, | |||||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||||
SPECTRA ENERGY PARTNERS |
||||||||||||||||
Operating Revenues |
$ |
663 |
$ |
634 |
$ |
2,533 |
$ |
2,455 |
||||||||
Operating Expenses |
||||||||||||||||
Operating, Maintenance and Other |
245 |
222 |
917 |
828 |
||||||||||||
Other Income and Expenses |
83 |
72 |
293 |
278 |
||||||||||||
EBITDA |
$ |
501 |
$ |
484 |
$ |
1,909 |
$ |
1,905 |
||||||||
Express Pipeline Revenue Receipts, MBbl/d (a) |
259 |
239 |
241 |
239 |
||||||||||||
Platte PADD II Deliveries, MBbl/d |
127 |
140 |
130 |
162 |
||||||||||||
DISTRIBUTION |
||||||||||||||||
Operating Revenues |
$ |
412 |
$ |
366 |
$ |
1,370 |
$ |
1,527 |
||||||||
Operating Expenses |
||||||||||||||||
Natural Gas Purchased |
181 |
152 |
533 |
691 |
||||||||||||
Operating, Maintenance and Other |
109 |
101 |
366 |
363 |
||||||||||||
Other Income and Expenses |
— |
— |
2 |
— |
||||||||||||
EBITDA |
$ |
122 |
$ |
113 |
$ |
473 |
$ |
473 |
||||||||
Number of Customers, Thousands |
1,459 |
1,437 |
||||||||||||||
Heating Degree Days, Fahrenheit |
2,278 |
2,017 |
6,821 |
7,387 |
||||||||||||
Pipeline Throughput, TBtu (b) |
215 |
165 |
762 |
759 |
||||||||||||
Canadian Dollar Exchange Rate, Average |
1.33 |
1.34 |
1.33 |
1.28 |
||||||||||||
WESTERN CANADA TRANSMISSION & PROCESSING |
||||||||||||||||
Operating Revenues |
$ |
221 |
$ |
323 |
$ |
1,020 |
$ |
1,285 |
||||||||
Operating Expenses |
||||||||||||||||
Natural Gas and Petroleum Products Purchased |
— |
69 |
68 |
193 |
||||||||||||
Operating, Maintenance and Other |
125 |
149 |
551 |
611 |
||||||||||||
Loss on sales of other assets and other, net |
(27) |
— |
(27) |
— |
||||||||||||
Other Income and Expenses |
5 |
4 |
13 |
10 |
||||||||||||
EBITDA |
$ |
74 |
$ |
109 |
$ |
387 |
$ |
491 |
||||||||
Pipeline Throughput, TBtu |
242 |
234 |
922 |
923 |
||||||||||||
Volumes Processed, TBtu |
152 |
165 |
636 |
658 |
||||||||||||
Canadian Dollar Exchange Rate, Average |
1.33 |
1.34 |
1.33 |
1.28 |
||||||||||||
FIELD SERVICES |
||||||||||||||||
Earnings (loss) from Equity Investment in DCP Midstream, LLC |
$ |
(41) |
$ |
(208) |
$ |
(40) |
$ |
(461) |
||||||||
Natural Gas Gathered and Processed/Transported, TBtu/day (c) |
6.1 |
7.1 |
6.5 |
7.1 |
||||||||||||
Natural Gas Liquids Production, MBbl/d (c) |
371 |
409 |
393 |
410 |
||||||||||||
Average Natural Gas Price Per MMBtu (d) |
$ |
2.98 |
$ |
2.27 |
$ |
2.46 |
$ |
2.66 |
||||||||
Average Natural Gas Liquids Price Per Gallon (e) |
$ |
0.55 |
$ |
0.42 |
$ |
0.46 |
$ |
0.45 |
||||||||
Average Crude Oil Price Per Barrel (f) |
$ |
49.15 |
$ |
42.20 |
$ |
43.30 |
$ |
48.80 |
||||||||
(a) Thousand barrels per day. |
||||||||||||||||
(b) Trillion British thermal units. |
||||||||||||||||
(c) Reflects 100% of DCP Midstream volumes. |
||||||||||||||||
(d) Million British thermal units. Average price based on NYMEX Henry Hub. |
||||||||||||||||
(e) Does not reflect results of commodity hedges. | ||||||||||||||||
(f) Average price based on NYMEX calendar month. |
Spectra Energy Corp | |||||||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
(In millions) | |||||||||||||||||||
Reported - These results include the impact of special items | |||||||||||||||||||
Quarters Ended |
Years Ended | ||||||||||||||||||
2016 |
2015 |
2016 |
2015 | ||||||||||||||||
Operating Revenues |
$ |
1,298 |
$ |
1,316 |
$ |
4,916 |
$ |
5,234 |
|||||||||||
Operating Expenses |
899 |
1,219 |
3,331 |
3,805 |
|||||||||||||||
Gain (Loss) on Sales of Other Assets and Other, net |
(26) |
— |
(26) |
4 |
|||||||||||||||
Operating Income |
373 |
97 |
1,559 |
1,433 |
|||||||||||||||
Other Income and Expenses |
48 |
(132) |
271 |
(176) |
|||||||||||||||
Interest Expense |
157 |
156 |
594 |
636 |
|||||||||||||||
Earnings (Loss) Before Income Taxes |
264 |
(191) |
1,236 |
621 |
|||||||||||||||
Income Tax Expense (Benefit) |
56 |
(3) |
216 |
161 |
|||||||||||||||
Net Income (Loss) |
208 |
(188) |
1,020 |
460 |
|||||||||||||||
Net Income - Noncontrolling Interests |
93 |
75 |
327 |
264 |
|||||||||||||||
Net Income (Loss) - Controlling Interests |
$ |
115 |
$ |
(263) |
$ |
693 |
$ |
196 |
Spectra Energy Corp | |||||||||||
Condensed Consolidated Balance Sheets | |||||||||||
(Unaudited) | |||||||||||
(In millions) | |||||||||||
December 31, |
December 31, | ||||||||||
2016 |
2015 | ||||||||||
ASSETS |
|||||||||||
Current Assets |
$ |
1,772 |
$ |
1,648 |
|||||||
Investments and Other Assets |
7,354 |
7,056 |
|||||||||
Net Property, Plant and Equipment |
26,208 |
22,918 |
|||||||||
Regulatory Assets and Deferred Debits |
1,508 |
1,301 |
|||||||||
Total Assets |
$ |
36,842 |
$ |
32,923 |
|||||||
LIABILITIES AND EQUITY |
|||||||||||
Current Liabilities |
$ |
3,905 |
$ |
3,392 |
|||||||
Long-term Debt |
13,624 |
12,892 |
|||||||||
Deferred Credits and Other Liabilities |
7,212 |
6,768 |
|||||||||
Preferred Stock of Subsidiaries |
562 |
339 |
|||||||||
Equity |
11,539 |
9,532 |
|||||||||
Total Liabilities and Equity |
$ |
36,842 |
$ |
32,923 |
|||||||
Spectra Energy Corp | ||||||||||||||||
Distributable Cash Flow | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions) | ||||||||||||||||
Reported - These results include the impact of special items | ||||||||||||||||
Quarters Ended |
Years Ended | |||||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||||
Net Income (Loss) |
$ |
208 |
$ |
(188) |
$ |
1,020 |
$ |
460 |
||||||||
Add: |
||||||||||||||||
Interest expense |
157 |
156 |
594 |
636 |
||||||||||||
Income tax expense (benefit) |
56 |
(3) |
216 |
161 |
||||||||||||
Depreciation and amortization |
192 |
190 |
774 |
764 |
||||||||||||
Foreign currency loss (gain) |
1 |
(1) |
1 |
6 |
||||||||||||
Less: |
||||||||||||||||
Third party interest income (expense) |
(1) |
1 |
2 |
3 |
||||||||||||
EBITDA |
615 |
153 |
2,603 |
2,024 |
||||||||||||
Add: |
||||||||||||||||
(Earnings) loss from equity investments |
2 |
4 |
(108) |
(76) |
||||||||||||
Non-cash impairments at DCP |
1 |
169 |
11 |
366 |
||||||||||||
Distributions from equity investments (a) |
28 |
26 |
161 |
209 |
||||||||||||
Empress non-cash items |
— |
18 |
42 |
42 |
||||||||||||
Non-cash goodwill impairments associated |
— |
333 |
— |
333 |
||||||||||||
Other non-cash asset impairments (b) |
1 |
7 |
1 |
16 |
||||||||||||
Other |
(8) |
(5) |
43 |
25 |
||||||||||||
Less: |
||||||||||||||||
Interest expense |
157 |
156 |
594 |
636 |
||||||||||||
Equity AFUDC |
48 |
38 |
164 |
111 |
||||||||||||
Net cash paid (refund) for income taxes |
(2) |
49 |
(5) |
29 |
||||||||||||
Distributions to noncontrolling interests |
70 |
58 |
246 |
198 |
||||||||||||
Maintenance capital expenditures |
196 |
210 |
613 |
691 |
||||||||||||
Total Distributable Cash Flow |
$ |
170 |
$ |
194 |
$ |
1,141 |
$ |
1,274 |
||||||||
(a) Excludes $403 million in distributions from equity investments for the year ended December 31, 2015. | ||||||||||||||||
(b) Includes non-cash asset impairments at SEP and WCTP. |
Spectra Energy Corp | |||||||||||||||
Reported to Ongoing Earnings Reconciliation | |||||||||||||||
December 2016 Quarter-to-Date | |||||||||||||||
(Unaudited) | |||||||||||||||
(In millions, except per-share amounts) | |||||||||||||||
Reported |
Less: Special |
Ongoing Earnings | |||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
|||||||||||||||
Spectra Energy Partners |
$ |
501 |
$ |
(36) |
A |
$ |
537 | ||||||||
Distribution |
122 |
— |
122 | ||||||||||||
Western Canada Transmission & Processing |
74 |
(31) |
B |
105 | |||||||||||
Field Services |
(41) |
(36) |
C |
(5) | |||||||||||
Total Reportable Segment EBITDA |
656 |
(103) |
759 | ||||||||||||
Other |
(41) |
(24) |
D |
(17) | |||||||||||
Total Reportable Segment and Other EBITDA |
$ |
615 |
$ |
(127) |
$ |
742 | |||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
615 |
$ |
(127) |
$ |
742 | |||||||||
Depreciation and Amortization |
(192) |
— |
(192) | ||||||||||||
Interest Expense |
(157) |
— |
(157) | ||||||||||||
Interest Income and Other |
(2) |
— |
(2) | ||||||||||||
Income Tax Benefit (Expense) |
(56) |
32 |
(88) | ||||||||||||
Total Net Income |
208 |
(95) |
303 | ||||||||||||
Total Net Income - Noncontrolling Interests |
(93) |
8 |
(101) | ||||||||||||
Total Net Income - Controlling Interests |
$ |
115 |
$ |
(87) |
$ |
202 | |||||||||
EARNINGS PER SHARE, BASIC |
$ |
0.16 |
$ |
(0.13) |
$ |
0.29 | |||||||||
EARNINGS PER SHARE, DILUTED |
$ |
0.16 |
$ |
(0.13) |
$ |
0.29 | |||||||||
A - Effects of Texas Eastern pipeline incident. | |||||||||||||||
B - The effects of flooding in British Columbia, non-cash net loss on sale of assets and non-cash asset impairment. | |||||||||||||||
C - Non-cash asset impairment and write-offs, transaction costs related to combining DCP Midstream and DCP Partners, and taxes related to conversion of a DCP Midstream entity from C Corp to LLC. | |||||||||||||||
D - Captive insurance claims associated with the flooding in British Columbia and transaction costs. | |||||||||||||||
Weighted Average Shares - in millions |
|||||||||||||||
Basic |
702 |
||||||||||||||
Diluted |
704 |
Spectra Energy Corp | |||||||||||||||
Reported to Ongoing Earnings Reconciliation | |||||||||||||||
December 2015 Quarter-to-Date | |||||||||||||||
(Unaudited) | |||||||||||||||
(In millions, except per-share amounts) | |||||||||||||||
Reported |
Less: Special |
Ongoing Earnings | |||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
|||||||||||||||
Spectra Energy Partners |
$ |
484 |
$ |
— |
$ |
484 | |||||||||
Distribution |
113 |
— |
113 | ||||||||||||
Western Canada Transmission & Processing |
109 |
(14) |
A |
123 | |||||||||||
Field Services |
(208) |
(172) |
B |
(36) | |||||||||||
Total Reportable Segment EBITDA |
498 |
(186) |
684 | ||||||||||||
Other |
(345) |
(333) |
C |
(12) | |||||||||||
Total Reportable Segment and Other EBITDA |
$ |
153 |
$ |
(519) |
$ |
672 | |||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
153 |
$ |
(519) |
$ |
672 | |||||||||
Depreciation and Amortization |
(190) |
— |
(190) | ||||||||||||
Interest Expense |
(156) |
(1) |
D |
(155) | |||||||||||
Interest Income and Other |
2 |
— |
2 | ||||||||||||
Income Tax Benefit (Expense) |
3 |
68 |
(65) | ||||||||||||
Total Net Income |
(188) |
(452) |
264 | ||||||||||||
Total Net Income - Noncontrolling Interests |
(75) |
— |
(75) | ||||||||||||
Total Net Income - Controlling Interests |
$ |
(263) |
$ |
(452) |
$ |
189 | |||||||||
EARNINGS PER SHARE, BASIC |
$ |
(0.39) |
$ |
(0.67) |
$ |
0.28 | |||||||||
EARNINGS PER SHARE, DILUTED |
$ |
(0.39) |
$ |
(0.67) |
$ |
0.28 | |||||||||
A - Employee and overhead reduction costs, and non-cash asset impairment. | |||||||||||||||
B - Employee and overhead reduction costs, non-cash asset impairments, and write-offs. | |||||||||||||||
C - Non-cash goodwill impairments associated with the Westcoast acquisition in 2002. | |||||||||||||||
D - Net write-off of regulatory assets and liabilities at Ozark Gas Transmission due to discontinuance of regulatory accounting. | |||||||||||||||
Weighted Average Shares - in millions |
|||||||||||||||
Basic |
671 |
||||||||||||||
Diluted |
673 |
Spectra Energy Corp | ||||||||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||||||||
December 2016 Year-to-Date | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except per-share amounts) | ||||||||||||||||
Reported |
Less: Special |
Ongoing Earnings | ||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
||||||||||||||||
Spectra Energy Partners |
$ |
1,909 |
$ |
(80) |
A |
$ |
1,989 | |||||||||
Distribution |
473 |
— |
473 | |||||||||||||
Western Canada Transmission & Processing |
387 |
(56) |
B |
443 | ||||||||||||
Field Services |
(40) |
(54) |
C |
14 | ||||||||||||
Total Reportable Segment EBITDA |
2,729 |
(190) |
2,919 | |||||||||||||
Other |
(126) |
(53) |
D |
(73) | ||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
2,603 |
$ |
(243) |
$ |
2,846 | ||||||||||
EARNINGS |
||||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
2,603 |
$ |
(243) |
$ |
2,846 | ||||||||||
Depreciation and Amortization |
(774) |
— |
(774) | |||||||||||||
Interest Expense |
(594) |
— |
(594) | |||||||||||||
Interest Income and Other |
1 |
— |
1 | |||||||||||||
Income Tax Benefit (Expense) |
(216) |
88 |
E |
(304) | ||||||||||||
Total Net Income |
1,020 |
(155) |
1,175 | |||||||||||||
Total Net Income - Noncontrolling Interests |
(327) |
19 |
(346) | |||||||||||||
Total Net Income - Controlling Interests |
$ |
693 |
$ |
(136) |
$ |
829 | ||||||||||
EARNINGS PER SHARE, BASIC |
$ |
1.00 |
$ |
(0.19) |
$ |
1.19 | ||||||||||
EARNINGS PER SHARE, DILUTED |
$ |
1.00 |
$ |
(0.19) |
$ |
1.19 | ||||||||||
A - Effects of Texas Eastern pipeline incident. | ||||||||||||||||
B - Employee and overhead reduction costs, the effects of flooding in British Columbia, non-cash net loss on sale of assets and non-cash asset impairment. | ||||||||||||||||
C - Non-cash asset impairments and write-offs, employee and overhead reduction costs, transaction costs related to combining DCP Midstream and DCP Partners, non-cash loss on sale of assets and taxes related to conversion of a DCP Midstream entity from C Corp to LLC. | ||||||||||||||||
D – Captive insurance associated with Texas Eastern pipeline incident and the flooding in British Columbia and transaction costs. | ||||||||||||||||
E - Includes a tax benefit on Empress transaction. | ||||||||||||||||
Weighted Average Shares - in millions |
||||||||||||||||
Basic |
694 |
|||||||||||||||
Diluted |
696 |
Spectra Energy Corp | |||||||||||||||
Reported to Ongoing Earnings Reconciliation | |||||||||||||||
December 2015 Year-to-Date | |||||||||||||||
(Unaudited) | |||||||||||||||
(In millions, except per-share amounts) | |||||||||||||||
Reported Earnings |
Less: Special |
Ongoing Earnings | |||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
|||||||||||||||
Spectra Energy Partners |
$ |
1,905 |
$ |
(9) |
A |
$ |
1,914 | ||||||||
Distribution |
473 |
— |
473 | ||||||||||||
Western Canada Transmission & Processing |
491 |
(25) |
B |
516 | |||||||||||
Field Services |
(461) |
(355) |
C |
(106) | |||||||||||
Total Reportable Segment EBITDA |
2,408 |
(389) |
2,797 | ||||||||||||
Other |
(384) |
(333) |
D |
(51) | |||||||||||
Total Reportable Segment and Other EBITDA |
$ |
2,024 |
$ |
(722) |
$ |
2,746 | |||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
2,024 |
$ |
(722) |
$ |
2,746 | |||||||||
Depreciation and Amortization |
(764) |
— |
(764) | ||||||||||||
Interest Expense |
(636) |
(1) |
E |
(635) | |||||||||||
Interest Income and Other |
(3) |
— |
(3) | ||||||||||||
Income Tax Benefit (Expense) |
(161) |
143 |
(304) | ||||||||||||
Total Net Income |
460 |
(580) |
1,040 | ||||||||||||
Total Net Income - Noncontrolling Interests |
(264) |
1 |
(265) | ||||||||||||
Total Net Income - Controlling Interests |
$ |
196 |
$ |
(579) |
$ |
775 | |||||||||
EARNINGS PER SHARE, BASIC |
$ |
0.29 |
$ |
(0.86) |
$ |
1.15 | |||||||||
EARNINGS PER SHARE, DILUTED |
$ |
0.29 |
$ |
(0.86) |
$ |
1.15 | |||||||||
A - Non-cash impairment at Ozark Gas Gathering. |
|||||||||||||||
B - Employee and overhead reduction costs, and non-cash asset impairment. | |||||||||||||||
C - Employee and overhead reduction costs, net gain on asset sales, non-cash goodwill and asset impairments and write-offs. | |||||||||||||||
D - Non-cash goodwill impairments associated with the Westcoast acquisition in 2002. | |||||||||||||||
E - Net write-off of regulatory assets and liabilities at Ozark Gas Transmission due to discontinuance of regulatory accounting. | |||||||||||||||
Weighted Average Shares - in millions |
|||||||||||||||
Basic |
671 |
||||||||||||||
Diluted |
672 |
Spectra Energy Corp | |||||||||||||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | |||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||
(In millions, except where noted) | |||||||||||||||||||||||
Quarters Ended |
Quarter Ended | ||||||||||||||||||||||
Reported |
Less: |
Ongoing |
Reported |
Less: |
Ongoing | ||||||||||||||||||
Net Income (Loss) |
$ |
208 |
$ |
(95) |
$ |
303 |
$ |
(188) |
$ |
(452) |
$ |
264 | |||||||||||
Add: |
|||||||||||||||||||||||
Interest expense |
157 |
— |
157 |
156 |
1 |
155 | |||||||||||||||||
Income tax expense (benefit) |
56 |
(32) |
88 |
(3) |
(68) |
65 | |||||||||||||||||
Depreciation and amortization |
192 |
— |
192 |
190 |
— |
190 | |||||||||||||||||
Foreign currency loss (gain) |
1 |
— |
1 |
(1) |
— |
(1) | |||||||||||||||||
Less: |
|||||||||||||||||||||||
Third party interest income (expense) |
(1) |
— |
(1) |
1 |
— |
1 | |||||||||||||||||
EBITDA |
615 |
(127) |
742 |
153 |
(519) |
672 | |||||||||||||||||
Add: |
|||||||||||||||||||||||
(Earnings) Loss from equity investments |
2 |
35 |
(33) |
4 |
3 |
1 | |||||||||||||||||
Non-cash impairments at DCP |
1 |
1 |
— |
169 |
169 |
— | |||||||||||||||||
Distributions from equity investments |
28 |
— |
28 |
26 |
— |
26 | |||||||||||||||||
Empress non-cash items |
— |
— |
— |
18 |
— |
18 | |||||||||||||||||
Non-cash goodwill impairments associated |
— |
— |
— |
333 |
333 |
— | |||||||||||||||||
with the Westcoast acquisition in 2002 | |||||||||||||||||||||||
Other non-cash asset impairments |
1 |
1 |
— |
7 |
7 |
— | |||||||||||||||||
Other |
(8) |
(19) |
11 |
(5) |
— |
(5) | |||||||||||||||||
Less: |
|||||||||||||||||||||||
Interest expense |
157 |
— |
157 |
156 |
— |
156 | |||||||||||||||||
Equity AFUDC |
48 |
— |
48 |
38 |
— |
38 | |||||||||||||||||
Net cash paid (refund) for income taxes |
(2) |
— |
(2) |
49 |
— |
49 | |||||||||||||||||
Distributions to noncontrolling interests |
70 |
— |
70 |
58 |
— |
58 | |||||||||||||||||
Maintenance capital expenditures |
196 |
30 |
166 |
210 |
— |
210 | |||||||||||||||||
Total Distributable Cash Flow |
$ |
170 |
$ |
(139) |
$ |
309 |
$ |
194 |
$ |
(7) |
$ |
201 |
Spectra Energy Corp | ||||||||||||||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | ||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||
(In millions, except where noted) | ||||||||||||||||||||||||
Years Ended |
Years Ended | |||||||||||||||||||||||
Reported |
Less: |
Ongoing |
Reported |
Less: |
Ongoing | |||||||||||||||||||
Net Income |
$ |
1,020 |
$ |
(155) |
$ |
1,175 |
$ |
460 |
$ |
(580) |
$ |
1,040 | ||||||||||||
Add: |
||||||||||||||||||||||||
Interest expense |
594 |
— |
594 |
636 |
1 |
635 | ||||||||||||||||||
Income tax expense |
216 |
(88) |
304 |
161 |
(143) |
304 | ||||||||||||||||||
Depreciation and amortization |
774 |
— |
774 |
764 |
— |
764 | ||||||||||||||||||
Foreign currency loss (gain) |
1 |
— |
1 |
6 |
— |
6 | ||||||||||||||||||
Less: |
||||||||||||||||||||||||
Third party interest income |
2 |
— |
2 |
3 |
— |
3 | ||||||||||||||||||
EBITDA |
2,603 |
(243) |
2,846 |
2,024 |
(722) |
2,746 | ||||||||||||||||||
Add: |
||||||||||||||||||||||||
Earnings from equity investments |
(108) |
43 |
(151) |
(76) |
(11) |
(65) | ||||||||||||||||||
Non-cash impairments at DCP |
11 |
11 |
— |
366 |
366 |
— | ||||||||||||||||||
Distributions from equity investments |
161 |
— |
161 |
209 |
— |
209 | ||||||||||||||||||
Empress non-cash items |
42 |
— |
42 |
42 |
— |
42 | ||||||||||||||||||
Non-cash goodwill impairments associated |
— |
— |
— |
333 |
333 |
— | ||||||||||||||||||
with the Westcoast acquisition in 2002 | ||||||||||||||||||||||||
Other non-cash asset impairments |
1 |
1 |
— |
16 |
16 |
— | ||||||||||||||||||
Other |
43 |
(19) |
62 |
25 |
— |
25 | ||||||||||||||||||
Less: |
||||||||||||||||||||||||
Interest expense |
594 |
— |
594 |
636 |
— |
636 | ||||||||||||||||||
Equity AFUDC |
164 |
— |
164 |
111 |
— |
111 | ||||||||||||||||||
Net cash paid (refund) for income taxes |
(5) |
— |
(5) |
29 |
— |
29 | ||||||||||||||||||
Distributions to noncontrolling interests |
246 |
— |
246 |
198 |
— |
198 | ||||||||||||||||||
Maintenance capital expenditures |
613 |
35 |
578 |
691 |
— |
691 | ||||||||||||||||||
Total Distributable Cash Flow |
$ |
1,141 |
$ |
(242) |
$ |
1,383 |
$ |
1,274 |
$ |
(18) |
$ |
1,292 | ||||||||||||
Dividends declared |
$ |
1,161 |
$ |
1,161 |
$ |
1,017 |
$ |
1,017 | ||||||||||||||||
Coverage - DCF / Dividend |
1.0x |
1.2x |
1.3x |
1.3x |
SOURCE Spectra Energy Corp
Final regulatory clearance required for closing is under the Canadian Competition Act
CALGARY, Alberta and HOUSTON, Feb. 16, 2017 /PRNewswire/ -- Enbridge Inc. (TSX, NYSE: ENB) (Enbridge) and Spectra Energy Corp (NYSE: SE) (Spectra Energy) announced today that the U.S. Federal Trade Commission (FTC) has cleared the previously announced proposed combination of the two companies.
As part of the clearance, the FTC today voted to accept a proposed consent decree in which Enbridge and Spectra Energy have agreed, following the closing of their proposed combination, to enact firewalls governing the flow of certain information to Enbridge about the Discovery offshore Gulf of Mexico natural gas pipeline system (Discovery), and to take certain other steps limiting Enbridge's potential influence over actions related to Discovery. Spectra Energy holds an ownership interest in Discovery through its indirect ownership interest in DCP Midstream, LP, which holds a 40 percent ownership interest in Discovery. Enbridge, through an affiliate, also has offshore natural gas gathering operations in the Gulf of Mexico. The FTC's decision is accessible via the following link: https://www.ftc.gov/enforcement/cases-proceedings/161-0215/enbridge-spectra-energy.
With this clearance from the FTC, the proposed combination of Enbridge and Spectra Energy has only one remaining regulatory clearance to secure in order to close the transaction: clearance under the Canadian Competition Act. The companies continue to expect the transaction to close in the first quarter of this year.
About Enbridge Inc.
Enbridge Inc., a Canadian company, exists to fuel people's quality of life, and has done so for more than 65 years. A North American leader in delivering energy, Enbridge has been ranked on the Global 100 Most Sustainable Corporations index for the past eight years. Enbridge operates the world's longest crude oil and liquids transportation system across Canada and the U.S., and has a significant and growing involvement in natural gas gathering, transmission and midstream business, as well as an increasing involvement in power transmission. Enbridge owns and operates Canada's largest natural gas distribution company, serving residential, commercial, and industrial customers in Ontario, Quebec, New Brunswick and New York State. Enbridge has interests in more than 2,200 megawatts of net renewable and alternative generating capacity, and continues to expand into wind, solar and geothermal power. Enbridge employs approximately 10,000 people, primarily in Canada and the U.S., and has been ranked 15 times on the annual Canada's Top 100 Employers list, including the 2017 index. Enbridge's common shares trade on the Toronto and New York stock exchanges under the symbol ENB. For more information, visit www.enbridge.com.
About Spectra Energy Corp
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include approximately 21,000 miles of natural gas and crude oil pipelines; approximately 300 billion cubic feet of natural gas storage; 5.6 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners, LP (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, LLC, which is the general partner of DCP Midstream, LP (NYSE: DCP), the largest natural gas liquids producer and the largest natural gas processor in the United States, and the largest gathering and processing master limited partnership in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
Forward-Looking Information
Certain information with respect to the proposed combination of Enbridge and Spectra Energy constitutes forward-looking statements. Although Enbridge and Spectra Energy believe these statements are based on information and assumptions which are current, reasonable and complete, these statements are necessarily subject to a variety of risks and uncertainties, including those pertaining to the timing and completion of the proposed combination. A further discussion of the risks and uncertainties facing Enbridge and Spectra Energy can be found in each company's filings with Canadian and United States securities regulators, as applicable. While Enbridge and Spectra Energy make these forward-looking statements in good faith, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. Except as may be required by applicable securities laws, neither Enbridge nor Spectra Energy assume any obligation to publicly update or revise any forward-looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.
SOURCE Spectra Energy Corp; Enbridge Inc.
Quarterly distribution increase of 1.25 cents to $0.68875 per unit
HOUSTON, Feb. 7, 2017 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) announced today that the board of directors of its general partner declared a quarterly cash distribution to unitholders of $0.68875 per unit, an increase of 1.25 cents over the previous level of $0.67625 per unit. The cash distribution is payable on February 28, 2017, to unitholders of record at the close of business on February 17, 2017. This quarterly cash distribution equates to $2.755 per unit on an annual basis.
"We are pleased to announce the company's 37th consecutive quarterly cash distribution increase. And due to our ongoing growth and reliable and disciplined approach, we are reaffirming our plan to continue quarterly penny-and-a-quarter distribution increases in 2017 while maintaining distributable cash flow coverage in our targeted range of 1.05 to 1.15 times," said Greg Ebel, chief executive officer, Spectra Energy Partners. "The General Partner of Spectra Energy Partners will change once the merger with Enbridge is complete, but the stable underpinnings of our business will not – Spectra Energy Partners will continue generating reliable cash flows."
This information is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Under rules applicable to publicly-traded partnerships, our distributions to non-U.S. unitholders are subject to withholding tax at the highest effective applicable rate to the extent attributable to income that is effectively connected with the conduct of a U.S. trade or business. Given the uncertainty at the time of making distributions regarding the amount of any distribution that is attributable to income that is so effectively connected, we intend to treat all of our distributions as attributable to our U.S. operations, and as a result, the entire distribution will be subject to withholding.
Non-GAAP Financial Measures
Distributable Cash Flow (DCF) is a non-GAAP financial measure, which represents the cash generation capabilities of the partnership to support distribution growth. The most directly comparable GAAP measure for DCF is net income.
DCF coverage is a non-GAAP financial measure, which represents DCF divided by distributions declared on partnership units. The most directly comparable GAAP measure for DCF coverage is Earnings Per Unit (EPU).
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2015 Form 10-K, filed on February 25, 2016, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
SOURCE Spectra Energy Partners, LP
HOUSTON, Jan. 6, 2017 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) and Spectra Energy Partners (NYSE: SEP) will issue their fourth quarter 2016 earnings results before the market opens on Friday, February 17, 2017, in order to coincide with their planned 10-K filings.
Given the proximity of the earnings releases with the anticipated first quarter closing of the merger with Enbridge Inc., Spectra Energy and Spectra Energy Partners will not host a quarterly conference call, but will provide financial results and project updates in their news releases consistent with previous practices, and will be available for individual analyst and investor calls as requested.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include approximately 21,000 miles of natural gas and crude oil pipelines; approximately 300 billion cubic feet of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, LLC, which is the general partner of DCP Midstream Partners, LP (NYSE: DPM), the largest natural gas liquids producer and the largest natural gas processor in the United States, and the largest gathering and processing master limited partnership in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
FORWARD-LOOKING STATEMENTS
This communication includes certain forward looking statements and information ("FLI") to provide Enbridge and Spectra Energy's shareholders and potential investors with information about Enbridge, Spectra Energy and their respective subsidiaries and affiliates, including each company's management's respective assessment of Enbridge, Spectra Energy and their respective subsidiaries' future plans and operations, which FLI may not be appropriate for other purposes. FLI is typically identified by words such as "anticipate", "expect", "project", "estimate", "forecast", "plan", "intend", "target", "believe", "likely" and similar words suggesting future outcomes or statements regarding an outlook. All statements other than statements of historical fact may be FLI. In particular, this document contains FLI pertaining to, but not limited to, information with respect to the proposed transaction jointly announced by Enbridge and Spectra Energy on September 6, 2016.
Although we believe that the FLI is reasonable based on the information available today and processes used to prepare it, such statements are not guarantees of future performance and you are cautioned against placing undue reliance on FLI. By its nature, FLI involves a variety of assumptions, which are based upon factors that may be difficult to predict and that may involve known and unknown risks and uncertainties and other factors which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by these FLI, including, but not limited to, the following: the timing and completion of the transaction, including receipt of regulatory approvals and the satisfaction of other conditions precedent; interloper risk; the realization of anticipated benefits and synergies of the transaction and the timing thereof; the success of integration plans; the focus of management time and attention on the transaction and other disruptions arising from the transaction; estimated future dividends; financial strength and flexibility; debt and equity market conditions, including the ability to access capital markets on favorable terms or at all; cost of debt and equity capital; potential changes in the Enbridge share price which may negatively impact the value of consideration offered to Spectra Energy shareholders; expected supply and demand for crude oil, natural gas, natural gas liquids and renewable energy; prices of crude oil, natural gas, natural gas liquids and renewable energy; economic and competitive conditions; expected exchange rates; inflation; interest rates; tax rates and changes; completion of growth projects; anticipated in-service dates; capital project funding; success of hedging activities; the ability of management of Enbridge, its subsidiaries and affiliates to execute key priorities, including those in connection with the transaction; availability and price of labor and construction materials; operational performance and reliability; customer, regulatory and other stakeholder approvals and support; regulatory and legislative decisions and actions; public opinion; and weather. We caution that the foregoing list of factors is not exhaustive. Additional information about these and other assumptions, risks and uncertainties can be found in applicable filings with Canadian and U.S. securities regulators, including any proxy statement, prospectus or registration statement filed in connection with the transaction. Due to the interdependencies and correlation of these factors, as well as other factors, the impact of any one assumption, risk or uncertainty on FLI cannot be determined with certainty.
Except to the extent required by law, we assume no obligation to publicly update or revise any FLI, whether as a result of new information, future events or otherwise. All FLI in this document is expressly qualified in its entirety by these cautionary statements.
SOURCE Spectra Energy Corp
Increases Annual Dividend to $1.76 from $1.62
HOUSTON, Jan. 5, 2017 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) has announced a 14-cent increase in its annual dividend on its common stock to $1.76 per share, or $0.44 on a quarterly basis. The quarterly cash dividend declared by Spectra Energy on its common stock for the first quarter of 2017 is payable on March 1, 2017, to shareholders of record at the close of business on February 15, 2017.
"Delivering on the commitment we made to our investors, which is underlined by our reliable cash flows, we are again increasing our annual dividend by 14 cents, to $1.76 per share," said Greg Ebel, chief executive officer, Spectra Energy. "Looking forward, our dividend growth projections are further enhanced upon completion of our proposed merger with Enbridge Inc. Including today's announced dividend increase, we anticipate investors of the combined company to benefit from an annualized 15 percent dividend increase in 2017, and then 10 to 12 percent annual increases through at least 2024."
Spectra Energy's proposed merger with Enbridge is expected to close in the first quarter this year.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include approximately 21,000 miles of natural gas and crude oil pipelines; approximately 300 billion cubic feet of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, LLC, which is the general partner of DCP Midstream Partners, LP (NYSE: DPM), the largest natural gas liquids producer and the largest natural gas processor in the United States, and the largest gathering and processing master limited partnership in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
FORWARD-LOOKING STATEMENTS
This communication includes certain forward looking statements and information ("FLI") to provide Enbridge and Spectra Energy's shareholders and potential investors with information about Enbridge, Spectra Energy and their respective subsidiaries and affiliates, including each company's management's respective assessment of Enbridge, Spectra Energy and their respective subsidiaries' future plans and operations, which FLI may not be appropriate for other purposes. FLI is typically identified by words such as "anticipate", "expect", "project", "estimate", "forecast", "plan", "intend", "target", "believe", "likely" and similar words suggesting future outcomes or statements regarding an outlook. All statements other than statements of historical fact may be FLI. In particular, this document contains FLI pertaining to, but not limited to, information with respect to the proposed transaction jointly announced by Enbridge and Spectra Energy on September 6, 2016.
Although we believe that the FLI is reasonable based on the information available today and processes used to prepare it, such statements are not guarantees of future performance and you are cautioned against placing undue reliance on FLI. By its nature, FLI involves a variety of assumptions, which are based upon factors that may be difficult to predict and that may involve known and unknown risks and uncertainties and other factors which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by these FLI, including, but not limited to, the following: the timing and completion of the transaction, including receipt of regulatory approvals and the satisfaction of other conditions precedent; interloper risk; the realization of anticipated benefits and synergies of the transaction and the timing thereof; the success of integration plans; the focus of management time and attention on the transaction and other disruptions arising from the transaction; estimated future dividends; financial strength and flexibility; debt and equity market conditions, including the ability to access capital markets on favorable terms or at all; cost of debt and equity capital; potential changes in the Enbridge share price which may negatively impact the value of consideration offered to Spectra Energy shareholders; expected supply and demand for crude oil, natural gas, natural gas liquids and renewable energy; prices of crude oil, natural gas, natural gas liquids and renewable energy; economic and competitive conditions; expected exchange rates; inflation; interest rates; tax rates and changes; completion of growth projects; anticipated in-service dates; capital project funding; success of hedging activities; the ability of management of Enbridge, its subsidiaries and affiliates to execute key priorities, including those in connection with the transaction; availability and price of labor and construction materials; operational performance and reliability; customer, regulatory and other stakeholder approvals and support; regulatory and legislative decisions and actions; public opinion; and weather. We caution that the foregoing list of factors is not exhaustive. Additional information about these and other assumptions, risks and uncertainties can be found in applicable filings with Canadian and U.S. securities regulators, including any proxy statement, prospectus or registration statement filed in connection with the transaction. Due to the interdependencies and correlation of these factors, as well as other factors, the impact of any one assumption, risk or uncertainty on FLI cannot be determined with certainty.
Except to the extent required by law, we assume no obligation to publicly update or revise any FLI, whether as a result of new information, future events or otherwise. All FLI in this document is expressly qualified in its entirety by these cautionary statements.
SOURCE Spectra Energy Corp
HOUSTON, Nov. 2, 2016 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) today reported net income of $296 million, including net income from controlling interests of $275 million, for the third quarter ended September 30, 2016, with diluted earnings per limited partner unit of $0.64. The third quarter included a non-recurring special item of $38 million, which decreased diluted earnings per limited partner unit by $0.12.
Highlights:
Third quarter 2016 ongoing distributable cash flow was $313 million, compared with $270 million in the prior-year quarter. Distributions per limited partner unit for third quarter 2016 were $0.67625, compared with $0.62625 per limited partner unit in third quarter 2015.
For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $469 million, compared with $467 million in the prior-year quarter.
Ongoing net income from controlling interests was $313 million for the quarter, or $0.76 diluted earnings per limited partner unit, compared with $321 million, or $0.85 diluted earnings per limited partner unit, in the prior-year quarter. Net income from controlling interests was $275 million for the quarter, or $0.64 diluted earnings per limited partner unit, compared with $321 million, or $0.85 diluted earnings per limited partner unit, in the prior-year quarter.
CEO COMMENT
"Spectra Energy Partners' results once again benefited from our robust expansion program, and reflect the strength of our fee-based business model that has no direct commodity exposure, virtually no volume exposure, and high credit-quality customers," said Greg Ebel, chief executive officer, Spectra Energy Partners. "Our base business continues to perform well, and we achieved a renewal rate of more than 98 percent of contracted revenues on our U.S. natural gas pipelines – a very solid indication of the value our customers place on our system and the strategic value of having assets in the ground to build upon. We continue to generate strong and reliable cash flows that support the growth in the distributions we promised to investors at the beginning of the year.
"Spectra Energy Partners is a must-own investment, and will remain a key financing vehicle for our U.S. pipeline projects when the proposed Spectra Energy and Enbridge merger is completed. Upon closing the merger, SEP will maintain its low-risk, stable distributable cash flow model that has served investors so well since its inception. SEP has excellent liquidity and access to capital markets at very attractive rates, allowing it to fund the visible, high-quality growth projects we have in execution today and those that we will move into execution in the future."
SEGMENT RESULTS
U.S. Transmission
Ongoing EBITDA from U.S. Transmission was $430 million in third quarter 2016, compared with $401 million in third quarter 2015. The third quarter 2016 results exclude a special item of $38 million in expense related to the Texas Eastern pipeline incident in Pennsylvania and reflect increased earnings from expansion projects.
Liquids
Liquids EBITDA was $60 million in third quarter 2016, compared with $79 million in third quarter 2015. The decrease is due almost entirely to the absence of equity earnings from Sand Hills and Southern Hills natural gas liquids (NGL) pipelines, which Spectra Energy Partners owned until October 2015.
Other
"Other" net expenses were $21 million in third quarter 2016, compared with $13 million in third quarter 2015, reflecting higher allocated benefits costs.
Interest Expense
Interest expense was $53 million in third quarter 2016, compared with $59 million in third quarter 2015, reflecting higher capitalized interest.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy Partners as of September 30, 2016, was $7.1 billion, with available liquidity of $1.7 billion.
Including contributions from noncontrolling interests, Spectra Energy Partners has $1.8 billion of capital expansion spending planned in 2016, which will be funded through a combination of debt and equity. Including contributions from noncontrolling interests of $437 million, total capital spending for the nine months ended September 30, 2016, was $1.3 billion, consisting of $1.1 billion of growth capital expenditures and $178 million of maintenance capital expenditures.
This year, Spectra Energy Partners has received net proceeds of $493 million through its "At the Market" (ATM) equity issuance program, plus an additional $489 million from equity issuances to its general partner.
EXPANSION PROJECT UPDATES
Spectra Energy Partners placed the Loudon Expansion into service on time in September, while the Express Enhancement and phase one of Gulf Markets came online in October – both earlier than expected. Additionally, the Salem Lateral went into service in October. The AIM project is intended to be fully in service in the fourth quarter.
Construction on Sabal Trail began in the third quarter, with the project scheduled to be placed into service in the first half of 2017.
In the third quarter, Spectra Energy Partners received the FERC Environmental Assessment for Access South, Adair Southwest, and Lebanon Extension, keeping these projects on target for in-service in the second half of 2017.
Atlantic Bridge is expected to receive its FERC certificate in the fourth quarter, keeping the project on schedule for a second half of 2017 in-service date.
FERC certificates are expected for the NEXUS and TEAL projects in the first quarter of 2017, with in-service scheduled for the fourth quarter of 2017.
The Bayway Lateral project is on schedule for its first half of 2018 in-service, and PennEast continues to make progress toward being placed into service in the second half of 2018.
Development work also continues in New England with the Access Northeast project, which is designed to both physically and contractually serve the needs of New England power generators by providing significant additional natural gas transmission capacity into the region, and will improve reliability and save consumers an average of $1 billion a year in energy costs during a normal winter.
The Independent System Operator in New England, which is responsible for operating the electric grid, recently stated that New England's power generation situation is "precarious" during the winter months, and that by 2019 – without immediate action to solidify the region's energy infrastructure – it may be unsustainable during extreme cold conditions.
Spectra Energy – along with co-developers Eversource and National Grid – are extremely disappointed by some of the recent actions by certain New England states. Despite this, Access Northeast remains the solution for the region, and Spectra Energy remains committed to delivering the reliable and affordable energy to help consumers and to help each state meet its energy and environmental goals.
ADDITIONAL INFORMATION
Additional information about third quarter 2016 earnings can be obtained via the Spectra Energy website: www.spectraenergy.com.
The analyst call, held jointly with Spectra Energy, is scheduled for today, Wednesday, November 2, 2016, at 8 a.m. CT. The webcast will be available via the Spectra Energy and Spectra Energy Partners Investors pages. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 70917863 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Friday, December 2, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Spectra Energy and Spectra Energy Partners Investors pages.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests as a measure to evaluate operations of the partnership. This measure is a non-GAAP financial measure as it represents net income from controlling interests, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measure for ongoing net income from controlling interests is net income from controlling interests.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Partners, LP. Ongoing EBITDA represents EBITDA, excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Partners, LP's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Partners, LP is net income.
The primary performance measures used by us to evaluate segment performance are segment EBITDA and Other EBITDA. We consider segment EBITDA and Other EBITDA, which are the GAAP measures used to report segment results, to be good indicators of each segment's operating performance from its continuing operations as they represent the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA and Other EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA as a measure of performance. Ongoing segment EBITDA is a non-GAAP financial measure, as it represents reported segment EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's ongoing performance across periods. The most directly comparable GAAP measure for ongoing segment EBITDA is segment EBITDA.
We also present Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the partnership to support distribution growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF, excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by distributions declared on partnership units. The most directly comparable GAAP measure for DCF coverage is Earnings-Per-Unit (EPU).
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other partnerships because other partnerships may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2015 Form 10-K, filed on February 25, 2016, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
Spectra Energy Partners, LP | ||||||||||||||||
Quarterly Highlights | ||||||||||||||||
September 2016 | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except per-unit amounts) | ||||||||||||||||
Reported - These results include the impact of special items | ||||||||||||||||
Three Months Ended |
Nine Months Ended | |||||||||||||||
September 30, |
September 30, | |||||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||||
INCOME |
||||||||||||||||
Operating Revenues |
$ |
628 |
$ |
612 |
$ |
1,870 |
$ |
1,821 |
||||||||
Total Reportable Segment EBITDA |
452 |
480 |
1,383 |
1,407 |
||||||||||||
Net Income - Controlling Interests |
275 |
321 |
860 |
921 |
||||||||||||
EBITDA BY BUSINESS SEGMENT |
||||||||||||||||
U.S. Transmission |
$ |
392 |
$ |
401 |
$ |
1,209 |
$ |
1,186 |
||||||||
Liquids |
60 |
79 |
174 |
221 |
||||||||||||
Total Reportable Segment EBITDA |
452 |
480 |
1,383 |
1,407 |
||||||||||||
Other EBITDA |
(21) |
(13) |
(63) |
(48) |
||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
431 |
$ |
467 |
$ |
1,320 |
$ |
1,359 |
||||||||
PARTNERS' CAPITAL |
||||||||||||||||
Declared Cash Distribution per Limited Partner Unit |
$ |
0.67625 |
$ |
0.62625 |
$ |
1.99125 |
$ |
1.84125 |
||||||||
Weighted Average Units Outstanding |
||||||||||||||||
Limited Partner Units |
304 |
301 |
296 |
297 |
||||||||||||
General Partner Units |
6 |
6 |
6 |
6 |
||||||||||||
DISTRIBUTABLE CASH FLOW |
||||||||||||||||
Distributable Cash Flow |
$ |
270 |
$ |
270 |
$ |
916 |
$ |
945 |
||||||||
CAPITAL AND INVESTMENT EXPENDITURES (a) |
||||||||||||||||
Capital expenditures - U.S. Transmission |
$ |
1,492 |
$ |
1,144 |
||||||||||||
Capital expenditures - Liquids |
54 |
17 |
||||||||||||||
Investment expenditures - Sand Hills/Southern Hills/SESH/Penn |
181 |
91 |
||||||||||||||
Total |
$ |
1,727 |
$ |
1,252 |
||||||||||||
U.S. TRANSMISSION |
||||||||||||||||
Operating Revenues |
$ |
535 |
$ |
515 |
$ |
1,602 |
$ |
1,546 |
||||||||
Operating Expenses |
||||||||||||||||
Operating, Maintenance and Other |
217 |
169 |
572 |
496 |
||||||||||||
Other Income and Expenses |
74 |
55 |
179 |
136 |
||||||||||||
EBITDA |
$ |
392 |
$ |
401 |
$ |
1,209 |
$ |
1,186 |
||||||||
LIQUIDS |
||||||||||||||||
Operating Revenues |
$ |
93 |
$ |
97 |
$ |
268 |
$ |
275 |
||||||||
Operating Expenses |
||||||||||||||||
Operating, Maintenance and Other |
32 |
37 |
94 |
105 |
||||||||||||
Other Income and Expenses |
(1) |
19 |
— |
51 |
||||||||||||
EBITDA |
$ |
60 |
$ |
79 |
$ |
174 |
$ |
221 |
||||||||
Express Pipeline Revenue Receipts, MBbl/d (b) |
235 |
234 |
234 |
239 |
||||||||||||
Platte PADD II Deliveries, MBbl/d |
131 |
167 |
131 |
169 |
||||||||||||
Canadian Dollar Exchange Rate, Average |
1.30 |
1.31 |
1.32 |
1.26 |
||||||||||||
September 30, |
December 31, | |||||||||||||||
2016 |
2015 | |||||||||||||||
Debt |
$ |
7,053 |
$ |
6,604 |
||||||||||||
Actual Units Outstanding (c) |
312 |
291 |
||||||||||||||
(a) Excludes contributions received from noncontrolling interests of $335 million in 2016 and $132 million in 2015. 2016 period also excludes sale of Sabal Trail interest of $102 million. | ||||||||||||||||
(b) Thousand barrels per day. | ||||||||||||||||
(c) Increase in 2016 resulted from the "At the Market" equity issuance program and equity issuance to Spectra Energy Corp in April 2016. |
Spectra Energy Partners, LP | |||||||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
(In millions) | |||||||||||||||||||
Reported - These results include the impact of special items | |||||||||||||||||||
Three Months |
Nine Months |
||||||||||||||||||
2016 |
2015 |
2016 |
2015 |
||||||||||||||||
Operating Revenues |
$ |
628 |
$ |
612 |
$ |
1,870 |
$ |
1,821 |
|||||||||||
Operating Expenses |
348 |
293 |
961 |
869 |
|||||||||||||||
Operating Income |
280 |
319 |
909 |
952 |
|||||||||||||||
Other Income and Expenses |
73 |
72 |
181 |
183 |
|||||||||||||||
Interest Expense |
53 |
59 |
165 |
179 |
|||||||||||||||
Earnings Before Income Taxes |
300 |
332 |
925 |
956 |
|||||||||||||||
Income Tax Expense |
4 |
1 |
13 |
8 |
|||||||||||||||
Net Income |
296 |
331 |
912 |
948 |
|||||||||||||||
Net Income - Noncontrolling Interests |
21 |
10 |
52 |
27 |
|||||||||||||||
Net Income - Controlling Interests |
$ |
275 |
$ |
321 |
$ |
860 |
$ |
921 |
Spectra Energy Partners, LP | |||||||||||
Condensed Consolidated Balance Sheets | |||||||||||
(Unaudited) | |||||||||||
(In millions) | |||||||||||
September 30, |
December 31, | ||||||||||
2016 |
2015 | ||||||||||
ASSETS |
|||||||||||
Current Assets |
$ |
761 |
$ |
544 |
|||||||
Investments and Other Assets |
4,418 |
4,180 |
|||||||||
Net Property, Plant and Equipment |
15,317 |
13,837 |
|||||||||
Regulatory Assets and Deferred Debits |
355 |
290 |
|||||||||
Total Assets |
$ |
20,851 |
$ |
18,851 |
|||||||
LIABILITIES AND EQUITY |
|||||||||||
Current Liabilities |
$ |
2,261 |
$ |
1,471 |
|||||||
Long-term Debt |
5,454 |
5,845 |
|||||||||
Deferred Credits and Other Liabilities |
204 |
189 |
|||||||||
Equity |
12,932 |
11,346 |
|||||||||
Total Liabilities and Equity |
$ |
20,851 |
$ |
18,851 |
Spectra Energy Partners, LP | |||||||||
Distributable Cash Flow | |||||||||
(Unaudited) | |||||||||
(In millions) | |||||||||
Reported - These results include the impact of special items | |||||||||
Three Months Ended |
Nine Months Ended |
||||||||
2016 |
2015 |
2016 |
2015 |
||||||
Net Income |
$ 296 |
$ 331 |
$ 912 |
$ 948 |
|||||
Add: |
|||||||||
Interest expense |
53 |
59 |
165 |
179 |
|||||
Income tax expense |
4 |
1 |
13 |
8 |
|||||
Depreciation and amortization |
78 |
74 |
232 |
220 |
|||||
Foreign currency loss |
- |
2 |
- |
5 |
|||||
Less: |
|||||||||
Third party interest income |
- |
- |
2 |
1 |
|||||
EBITDA |
431 |
467 |
1,320 |
1,359 |
|||||
Add: |
|||||||||
Earnings from equity investments |
(35) |
(49) |
(92) |
(134) |
|||||
Distributions from equity investments |
35 |
59 |
132 |
183 |
|||||
Non-cash impairment at Ozark Gas Gathering |
- |
- |
- |
9 |
|||||
Other |
9 |
2 |
12 |
8 |
|||||
Less: |
|||||||||
Interest expense |
53 |
59 |
165 |
179 |
|||||
Equity AFUDC |
38 |
23 |
84 |
50 |
|||||
Net cash paid for income taxes |
2 |
1 |
7 |
8 |
|||||
Distributions to non-controlling interests |
7 |
7 |
22 |
23 |
|||||
Maintenance capital expenditures |
70 |
119 |
178 |
220 |
|||||
Total Distributable Cash Flow |
$ 270 |
$ 270 |
$ 916 |
$ 945 |
Spectra Energy Partners, LP |
|||||||||||||||
Reported to Ongoing Earnings Reconciliation |
|||||||||||||||
September 2016 Quarter-to-Date |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In millions) |
|||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported Earnings |
Less: Special |
Ongoing Earnings |
||||||||||||
U.S. Transmission |
$ |
392 |
$ |
(38) |
A |
$ |
430 |
||||||||
Liquids |
60 |
— |
60 |
||||||||||||
Total Reportable Segment EBITDA |
452 |
(38) |
490 |
||||||||||||
Other |
(21) |
— |
(21) |
||||||||||||
Total Reportable Segment and other EBITDA |
$ |
431 |
$ |
(38) |
$ |
469 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
431 |
$ |
(38) |
$ |
469 |
|||||||||
Depreciation and Amortization |
(78) |
— |
(78) |
||||||||||||
Interest Expense |
(53) |
— |
(53) |
||||||||||||
Income Tax Expense |
(4) |
— |
(4) |
||||||||||||
Total Net Income |
296 |
(38) |
334 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(21) |
— |
(21) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
275 |
$ |
(38) |
$ |
313 |
|||||||||
A - Inspection and repair costs related to Texas Eastern pipeline incident in Pennsylvania |
Spectra Energy Partners, LP |
||||||||
Reported to Ongoing Earnings Reconciliation |
||||||||
September 2015 Quarter-to-Date |
||||||||
(Unaudited) |
||||||||
(In millions) |
||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
Reported/ Ongoing |
|||||||
U.S. Transmission |
$ |
401 |
||||||
Liquids |
79 |
|||||||
Total Reportable Segment EBITDA |
480 |
|||||||
Other |
(13) |
|||||||
Total Reportable Segment and other EBITDA |
$ |
467 |
||||||
EARNINGS |
||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
467 |
||||||
Depreciation and Amortization |
(74) |
|||||||
Interest Expense |
(59) |
|||||||
Other Income and Expenses |
(2) |
|||||||
Income Tax Expense |
(1) |
|||||||
Total Net Income |
331 |
|||||||
Total Net Income - Noncontrolling Interests |
(10) |
|||||||
Total Net Income - Controlling Interests |
$ |
321 |
||||||
Spectra Energy Partners, LP | |||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | |||||||||||||
Unaudited | |||||||||||||
(In millions) | |||||||||||||
Three Months Ended |
Three Months Ended |
||||||||||||
September 30, 2016 |
September 30, 2015 |
||||||||||||
Reported |
Less: |
Ongoing |
Reported |
Less: |
Ongoing |
||||||||
Net Income |
$ 296 |
$ (38) |
$ 334 |
$ 331 |
$ - |
$ 331 |
|||||||
Add: |
|||||||||||||
Interest expense |
53 |
- |
53 |
59 |
- |
59 |
|||||||
Income tax expense |
4 |
- |
4 |
1 |
- |
1 |
|||||||
Depreciation and amortization |
78 |
- |
78 |
74 |
- |
74 |
|||||||
Foreign currency loss |
- |
- |
- |
2 |
- |
2 |
|||||||
Less: |
|||||||||||||
Third party interest income |
- |
- |
- |
- |
- |
- |
|||||||
EBITDA |
431 |
(38) |
469 |
467 |
- |
467 |
|||||||
Add: |
|||||||||||||
Earnings from equity investments |
(35) |
- |
(35) |
(49) |
- |
(49) |
|||||||
Distributions from equity investments |
35 |
- |
35 |
59 |
- |
59 |
|||||||
Other |
9 |
- |
9 |
2 |
- |
2 |
|||||||
Less: |
|||||||||||||
Interest expense |
53 |
- |
53 |
59 |
- |
59 |
|||||||
Equity AFUDC |
38 |
- |
38 |
23 |
- |
23 |
|||||||
Net cash paid for income taxes |
2 |
- |
2 |
1 |
- |
1 |
|||||||
Distributions to non-controlling interests |
7 |
- |
7 |
7 |
- |
7 |
|||||||
Maintenance capital expenditures |
70 |
5 |
65 |
119 |
- |
119 |
|||||||
Total Distributable Cash Flow |
$ 270 |
$ (43) |
$ 313 |
$ 270 |
$ - |
$ 270 |
Logo - http://photos.prnewswire.com/prnh/20071107/CLW064
SOURCE Spectra Energy Partners, LP
HOUSTON, Nov. 2, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) today reported net income of $281 million, including net income from controlling interests of $195 million, for the third quarter ended September 30, 2016, with diluted earnings per share of $0.28. The third quarter results included non-recurring special items, which had income tax effects of $41 million and decreased diluted earnings per share by $0.03.
Highlights:
For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $692 million, compared with $634 million in the prior-year quarter.
Ongoing distributable cash flow for the quarter was $280 million, compared with $223 million in the same quarter last year.
For the quarter, ongoing net income from controlling interests was $220 million, or $0.31 diluted earnings per share, compared with $156 million, or $0.23 diluted earnings per share, in third quarter 2015. Net income from controlling interests was $195 million, or $0.28 diluted earnings per share, compared with $174 million, or $0.26 diluted earnings per share, in third quarter 2015.
CEO COMMENT
"Spectra Energy delivered yet another solid quarter, with ongoing results very much in line with our full-year expectations. The strength of our base businesses and growth from our robust expansion program continue to provide outstanding value to investors," said Greg Ebel, chief executive officer, Spectra Energy.
"We have a track record of delivering projects on time and on budget, and we have built on that reputation with projects we placed into service in the third quarter and those scheduled to be in service in the fourth quarter. This is a testament to our execution model, our team, and the strategic value of being able to build upon our existing asset footprint. These expansion projects and the reliable, affordable energy they will supply across North America will serve customers and investors for decades to come. We are equally pleased with the fact that DCP Midstream has already achieved its 35-cent NGL break-even target.
"As we progress toward completing our proposed merger with Enbridge, we remain highly confident in the strategic value of the combination and the ability of the 'new' Enbridge to deliver on the benefits that we outlined for investors when we announced the transaction in September."
EFFECTS OF SPECIAL ITEMS
Third Quarter 2016 |
||||||
($MM) |
Segment |
EBITDA |
Income |
Net |
DCF | |
Ongoing |
$ 692 |
$ (51) |
$ 220 |
$ 280 | ||
Adjustments related to Special Items |
||||||
Costs related to Texas Eastern pipeline incident | ||||||
Inspection and repair costs |
SEP |
$ (38) |
$ 10 |
$ (18) |
(2) |
$ (38) |
Maintenance capital expenditures |
SEP |
- |
- |
- |
(5) | |
Effects of flooding in British Columbia |
W. Canada |
(13) |
3 |
(10) |
(13) | |
Employee and overhead reduction costs |
W. Canada |
(3) |
- |
(3) |
(3) | |
Tax benefit on Empress transaction |
W. Canada |
- |
27 |
27 |
- | |
Employee and overhead reduction costs |
Field Services |
(2) |
1 |
(1) |
- | |
Gain on sale of an asset |
Field Services |
2 |
(1) |
1 |
- | |
Asset impairment |
Field Services |
(3) |
1 |
(2) |
- | |
Transaction costs |
Other |
(19) |
- |
(19) |
(19) | |
Total Special Items |
$ (76) |
$ 41 |
$ (25) |
$ (78) | ||
Reported |
$ 616 |
$ (10) |
$ 195 |
$ 202 | ||
(1) Represents net income from controlling interests |
||||||
(2) Net of non-controlling interests impact of $10 million |
||||||
Third Quarter 2015 |
||||||
($MM) |
Segment |
EBITDA |
Income |
Net |
DCF | |
Ongoing |
$ 634 |
$ (62) |
$ 156 |
$ 223 | ||
Adjustments related to Special Items |
||||||
Employee and overhead reduction costs |
Field Services |
(1) |
1 |
- |
- | |
Gain on sale of an asset |
Field Services |
30 |
(11) |
19 |
- | |
Goodwill impairment |
Field Services |
(3) |
2 |
(1) |
- | |
Total Special Items |
$ 26 |
$ (8) |
$ 18 |
$ - | ||
Reported |
$ 660 |
$ (70) |
$ 174 |
$ 223 | ||
(1) Represents net income from controlling interests |
SEGMENT RESULTS
Spectra Energy Partners
Ongoing EBITDA from Spectra Energy Partners was $502 million in third quarter 2016, compared with $488 million in third quarter 2015. Third quarter 2016 results exclude a special item of $38 million in expense. These results reflect increased earnings from expansion projects, partially offset by the absence of equity earnings from Sand Hills and Southern Hills natural gas liquids (NGL) pipelines, which Spectra Energy Partners owned until October 2015. Earnings from these NGL pipeline interests have been reflected in the Field Services segment.
Distribution
Distribution EBITDA was $77 million in third quarter 2016, compared with $70 million in third quarter 2015. This increase was mainly due to incremental earnings from the 2015 Dawn-Parkway expansion project and higher storage margins.
Western Canada Transmission & Processing
Ongoing EBITDA from Western Canada Transmission & Processing was $109 million in third quarter 2016, compared with $117 million in third quarter 2015. The 2016 period excludes special items of $16 million, which unfavorably affected EBITDA. The segment's results largely reflect lower gathering and processing revenues.
Field Services
Ongoing EBITDA from Field Services was $15 million in third quarter 2016, compared with $(29) million in third quarter 2015. The 2016 and 2015 periods exclude special items of $3 million in net expenses and $26 million in net gains, respectively. The segment's results are primarily attributable to favorable contract realignment efforts, continued cost-saving initiatives and asset growth, partially offset by volume declines in certain geographic regions. As a reminder, Spectra Energy's EBITDA from Field Services represents the company's 50 percent share of DCP Midstream's net income plus gains from DPM unit issuances.
During the third quarters of 2016 and 2015, respectively, NGL prices averaged $0.45 per gallon versus $0.42 per gallon, NYMEX natural gas averaged $2.81 per million British thermal units (MMBtu) versus $2.77 per MMBtu, and crude oil averaged approximately $45 per barrel versus $46 per barrel.
Other
Ongoing net expenses from "Other" were $11 million and $12 million in third quarters 2016 and 2015, respectively. The 2016 period excludes a special item of $19 million in expense. "Other" primarily consists of corporate expenses, including benefits and captive insurance.
Interest Expense
Interest expense was $133 million in third quarter 2016, compared with $155 million in third quarter 2015, primarily due to a reversal of an interest accrual related to the release of tax reserves.
Income Tax Expense
Income tax expense was $10 million in third quarter 2016, compared with $70 million in third quarter 2015, with effective tax rates of 3 percent and 22 percent, respectively. The release of tax reserves contributed to the lower tax expense and lower rate in the quarter. The 2016 period also included a $27 million tax benefit reported as a special item related to the sale of Empress.
Foreign Currency
Net income from controlling interests for the quarter was higher by $4 million.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy as of September 30, 2016, was $15.2 billion, with available liquidity of $5.2 billion. Available liquidity includes a $2 billion credit facility executed at Spectra Energy Capital in September 2016.
Including contributions from noncontrolling interests, Spectra Energy has $3.0 billion of capital expansion spending planned in 2016, $1.8 billion of which will be at Spectra Energy Partners. Including contributions from noncontrolling interests of $437 million, total capital spending for the nine months ended September 30, 2016, was $2.15 billion, comprised of $1.73 billion of growth capital expenditures and $417 million of maintenance capital expenditures.
EXPANSION PROJECT UPDATES
By the end of 2016, the company will have:
U.S. Projects
Spectra Energy Partners placed the Loudon Expansion into service on time in September, while the Express Enhancement and phase one of Gulf Markets came online in October – both earlier than expected. Additionally, the Salem Lateral went into service in October. The AIM project is intended to be fully in service in the fourth quarter.
Construction on Sabal Trail began in the third quarter, with the project scheduled to be placed into service in the first half of 2017.
In the third quarter, Spectra Energy Partners received the FERC Environmental Assessment for Access South, Adair Southwest, and Lebanon Extension, keeping these projects on target for in-service in the second half of 2017.
Atlantic Bridge is expected to receive its FERC certificate in the fourth quarter, keeping the project on schedule for a second half of 2017 in-service date.
FERC certificates are expected for the NEXUS and TEAL projects in the first quarter of 2017, with in-service scheduled for the fourth quarter of 2017.
The Bayway Lateral project is on schedule for its first half of 2018 in-service, and PennEast continues to make progress toward being placed into service in the second half of 2018.
The Valley Crossing Pipeline project continues to advance, and is in the process of submitting the necessary regulatory applications. It has begun right of way acquisitions, and continues to progress toward its second half of 2018 in-service date.
Development work also continues in New England with the Access Northeast project, which is designed to both physically and contractually serve the needs of New England power generators by providing significant additional natural gas transmission capacity into the region, and will improve reliability and save consumers an average of $1 billion a year in energy costs during a normal winter.
The Independent System Operator in New England, which is responsible for operating the electric grid, recently stated that New England's power generation situation is "precarious" during the winter months, and that by 2019 – without immediate action to solidify the region's energy infrastructure – it may be unsustainable during extreme cold conditions.
Spectra Energy – along with co-developers Eversource and National Grid – are extremely disappointed by some of the recent actions by certain New England states. Despite this, Access Northeast remains the solution for the region, and Spectra Energy remains committed to delivering the reliable and affordable energy to help consumers and to help each state meet its energy and environmental goals.
Distribution
At Union Gas, both the Burlington-Oakville and 2016 Dawn-Parkway projects were placed in service this week.
The 2017 Dawn-Parkway expansion continues to make progress toward its second half of 2017 in-service date, as does the Panhandle Reinforcement project.
Western Canada
High Pine received its National Energy Board (NEB) approval in August. With this approval, the construction timeline has shifted, moving the in-service date of this project from the first half of 2017 to the second half of 2017.
In the third quarter, construction began on Jackfish Lake, which will be placed into service in the first half of 2017, and on the RAM project, which will be phased into service through 2018.
The Wyndwood project submitted its application to the NEB in October, and is on track for its first half of 2018 in-service.
ADDITIONAL INFORMATION
Additional information about third quarter 2016 earnings can be obtained via the Spectra Energy website: www.spectraenergy.com.
The analyst call, held jointly with Spectra Energy Partners, is scheduled for today, Wednesday, November 2, 2016, at 8 a.m. CT. The webcast will be available via the Spectra Energy and Spectra Energy Partners Investors pages. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 70917863 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Friday, December 2, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Spectra Energy and Spectra Energy Partners Investors pages.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests and ongoing diluted EPS as measures to evaluate operations of the company. These measures are non-GAAP financial measures as they represent net income from controlling interests and diluted EPS, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests and ongoing diluted EPS provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measures for ongoing net income from controlling interests and ongoing diluted EPS are net income from controlling interests and diluted EPS.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Corp. Ongoing EBITDA represents EBITDA, excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Corp's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Corp is net income.
The primary performance measures used by us to evaluate segment performance are segment EBITDA and Other EBITDA. We consider segment EBITDA and Other EBITDA, which are the GAAP measures used to report segment results, to be good indicators of each segment's operating performance from its continuing operations as they represent the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA and Other EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA and ongoing Other EBITDA (net expenses) as measures of performance. Ongoing segment EBITDA and ongoing Other EBITDA are non-GAAP financial measures, as they represent segment EBITDA and Other EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA and ongoing Other EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's or Other's ongoing performance across periods. The most directly comparable GAAP measures for ongoing segment EBITDA and ongoing Other EBITDA are segment EBITDA and Other EBITDA.
We also present Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the company to support dividend growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF, excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by dividends declared on common stock. The most directly comparable GAAP measure for DCF coverage is EPS.
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other companies because other companies may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2015 Form 10-K, filed on February 25, 2016, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include approximately 21,000 miles of natural gas and crude oil pipelines; approximately 300 billion cubic feet of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
Spectra Energy Corp | |||||||||||||||||
Quarterly Highlights | |||||||||||||||||
September 2016 | |||||||||||||||||
(Unaudited) | |||||||||||||||||
(In millions, except per-share amounts and where noted) | |||||||||||||||||
Reported - These results include the impact of special items | |||||||||||||||||
Three Months |
Nine Months | ||||||||||||||||
2016 |
2015 |
2016 |
2015 | ||||||||||||||
COMMON STOCK DATA |
|||||||||||||||||
Earnings Per Share, Diluted |
$ |
0.28 |
$ |
0.26 |
$ |
0.83 |
$ |
0.68 |
|||||||||
Dividends Per Share |
$ |
0.405 |
$ |
0.37 |
$ |
1.215 |
$ |
1.11 |
|||||||||
Weighted-Average Shares Outstanding, Diluted |
703 |
672 |
693 |
672 |
|||||||||||||
INCOME |
|||||||||||||||||
Operating Revenues |
$ |
1,075 |
$ |
1,103 |
$ |
3,618 |
$ |
3,918 |
|||||||||
Total Reportable Segment EBITDA |
646 |
672 |
2,073 |
1,910 |
|||||||||||||
Net Income - Controlling Interests |
195 |
174 |
578 |
459 |
|||||||||||||
EBITDA BY BUSINESS SEGMENT |
|||||||||||||||||
Spectra Energy Partners |
$ |
464 |
$ |
488 |
$ |
1,408 |
$ |
1,421 |
|||||||||
Distribution |
77 |
70 |
351 |
360 |
|||||||||||||
Western Canada Transmission & Processing |
93 |
117 |
313 |
382 |
|||||||||||||
Field Services |
12 |
(3) |
1 |
(253) |
|||||||||||||
Total Reportable Segment EBITDA |
646 |
672 |
2,073 |
1,910 |
|||||||||||||
Other EBITDA |
(30) |
(12) |
(85) |
(39) |
|||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
616 |
$ |
660 |
$ |
1,988 |
$ |
1,871 |
|||||||||
DISTRIBUTABLE CASH FLOW |
|||||||||||||||||
Distributable Cash Flow |
$ |
202 |
$ |
223 |
$ |
971 |
$ |
1,080 |
|||||||||
CAPITAL AND INVESTMENT EXPENDITURES |
|||||||||||||||||
Spectra Energy Partners (a) |
$ |
1,727 |
$ |
1,252 |
|||||||||||||
Distribution |
577 |
374 |
|||||||||||||||
Western Canada Transmission & Processing |
246 |
241 |
|||||||||||||||
Other |
38 |
41 |
|||||||||||||||
Total Capital and Investment Expenditures (a) |
$ |
2,588 |
$ |
1,908 |
|||||||||||||
Expansion and Investment (a) |
$ |
2,171 |
$ |
1,433 |
|||||||||||||
Maintenance and Other |
417 |
475 |
|||||||||||||||
Total Capital and Investment Expenditures (a) |
$ |
2,588 |
$ |
1,908 |
|||||||||||||
September 30, |
December 31, | ||||||||||||||||
2016 |
2015 | ||||||||||||||||
CAPITALIZATION |
|||||||||||||||||
Common Equity - Controlling Interests |
27.5 |
% |
26.6 |
% | |||||||||||||
Noncontrolling Interests and Preferred Stock |
16.6 |
% |
13.6 |
% | |||||||||||||
Total Debt |
55.9 |
% |
59.8 |
% | |||||||||||||
Total Debt |
$ |
15,198 |
$ |
14,656 |
|||||||||||||
Book Value Per Share (b) |
$ |
10.65 |
$ |
9.73 |
|||||||||||||
Actual Shares Outstanding (c) |
701 |
671 |
|||||||||||||||
(a) Excludes contributions received from noncontrolling interests of $335 million in 2016 and $132 million in 2015. 2016 period also excludes sale of Sabal Trail interest of $102 million. | |||||||||||||||||
(b) Represents controlling interests. |
|||||||||||||||||
(c) Increase in 2016 resulted from a newly initiated "At the Market" equity issuance program in March 2016 and equity issuance to the public in April 2016. |
Spectra Energy Corp | ||||||||||||||||
Quarterly Highlights | ||||||||||||||||
September 2016 | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except where noted) | ||||||||||||||||
Reported - These results include the impact of special items | ||||||||||||||||
Three Months |
Nine Months | |||||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||||
SPECTRA ENERGY PARTNERS |
||||||||||||||||
Operating Revenues |
$ |
628 |
$ |
612 |
$ |
1,870 |
$ |
1,821 |
||||||||
Operating Expenses |
||||||||||||||||
Operating, Maintenance and Other |
251 |
207 |
672 |
606 |
||||||||||||
Other Income and Expenses |
87 |
83 |
210 |
206 |
||||||||||||
EBITDA |
$ |
464 |
$ |
488 |
$ |
1,408 |
$ |
1,421 |
||||||||
Express Pipeline Revenue Receipts, MBbl/d (a) |
235 |
234 |
234 |
239 |
||||||||||||
Platte PADD II Deliveries, MBbl/d |
131 |
167 |
131 |
169 |
||||||||||||
DISTRIBUTION |
||||||||||||||||
Operating Revenues |
$ |
209 |
$ |
209 |
$ |
958 |
$ |
1,161 |
||||||||
Operating Expenses |
||||||||||||||||
Natural Gas Purchased |
46 |
53 |
352 |
539 |
||||||||||||
Operating, Maintenance and Other |
86 |
86 |
257 |
262 |
||||||||||||
Other Income and Expenses |
— |
— |
2 |
— |
||||||||||||
EBITDA |
$ |
77 |
$ |
70 |
$ |
351 |
$ |
360 |
||||||||
Number of Customers, Thousands |
1,450 |
1,429 |
||||||||||||||
Heating Degree Days, Fahrenheit |
196 |
245 |
4,543 |
5,370 |
||||||||||||
Pipeline Throughput, TBtu (b) |
162 |
134 |
547 |
594 |
||||||||||||
Canadian Dollar Exchange Rate, Average |
1.30 |
1.31 |
1.32 |
1.26 |
||||||||||||
WESTERN CANADA TRANSMISSION & PROCESSING |
||||||||||||||||
Operating Revenues |
$ |
236 |
$ |
288 |
$ |
799 |
$ |
962 |
||||||||
Operating Expenses |
||||||||||||||||
Natural Gas and Petroleum Products Purchased |
5 |
32 |
68 |
124 |
||||||||||||
Operating, Maintenance and Other |
141 |
141 |
426 |
462 |
||||||||||||
Other Income and Expenses |
3 |
2 |
8 |
6 |
||||||||||||
EBITDA |
$ |
93 |
$ |
117 |
$ |
313 |
$ |
382 |
||||||||
Pipeline Throughput, TBtu |
214 |
213 |
680 |
689 |
||||||||||||
Volumes Processed, TBtu |
145 |
157 |
484 |
493 |
||||||||||||
Canadian Dollar Exchange Rate, Average |
1.30 |
1.31 |
1.32 |
1.26 |
||||||||||||
FIELD SERVICES |
||||||||||||||||
Earnings (loss) from Equity Investment in DCP Midstream, LLC |
$ |
12 |
$ |
(3) |
$ |
1 |
$ |
(253) |
||||||||
Natural Gas Gathered and Processed/Transported, TBtu/day (c) |
6.4 |
7.3 |
6.7 |
7.1 |
||||||||||||
Natural Gas Liquids Production, MBbl/d (c) |
403 |
421 |
400 |
410 |
||||||||||||
Average Natural Gas Price Per MMBtu (d) |
$ |
2.81 |
$ |
2.77 |
$ |
2.29 |
$ |
2.80 |
||||||||
Average Natural Gas Liquids Price Per Gallon (e) |
$ |
0.45 |
$ |
0.42 |
$ |
0.43 |
$ |
0.46 |
||||||||
Average Crude Oil Price Per Barrel (f) |
$ |
44.94 |
$ |
46.43 |
$ |
41.34 |
$ |
51.00 |
||||||||
(a) Thousand barrels per day. |
||||||||||||||||
(b) Trillion British thermal units. |
||||||||||||||||
(c) Reflects 100% of DCP Midstream volumes. |
||||||||||||||||
(d) Million British thermal units. Average price based on NYMEX Henry Hub. |
||||||||||||||||
(e) Does not reflect results of commodity hedges. |
||||||||||||||||
(f) Average price based on NYMEX calendar month. |
Spectra Energy Corp | |||||||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
(In millions) | |||||||||||||||||||
Reported - These results include the impact of special items | |||||||||||||||||||
Three Months |
Nine Months | ||||||||||||||||||
2016 |
2015 |
2016 |
2015 | ||||||||||||||||
Operating Revenues |
$ |
1,075 |
$ |
1,103 |
$ |
3,618 |
$ |
3,918 |
|||||||||||
Operating Expenses |
754 |
714 |
2,432 |
2,582 |
|||||||||||||||
Operating Income |
321 |
389 |
1,186 |
1,336 |
|||||||||||||||
Other Income and Expenses |
103 |
79 |
223 |
(44) |
|||||||||||||||
Interest Expense |
133 |
155 |
437 |
480 |
|||||||||||||||
Earnings Before Income Taxes |
291 |
313 |
972 |
812 |
|||||||||||||||
Income Tax Expense |
10 |
70 |
160 |
164 |
|||||||||||||||
Net Income |
281 |
243 |
812 |
648 |
|||||||||||||||
Net Income - Noncontrolling Interests |
86 |
69 |
234 |
189 |
|||||||||||||||
Net Income - Controlling Interests |
$ |
195 |
$ |
174 |
$ |
578 |
$ |
459 |
Spectra Energy Corp | |||||||||||
Condensed Consolidated Balance Sheets | |||||||||||
(Unaudited) | |||||||||||
(In millions) | |||||||||||
September 30, |
December 31, | ||||||||||
2016 |
2015 | ||||||||||
ASSETS |
|||||||||||
Current Assets |
$ |
1,750 |
$ |
1,648 |
|||||||
Investments and Other Assets |
7,346 |
7,056 |
|||||||||
Net Property, Plant and Equipment |
25,337 |
22,918 |
|||||||||
Regulatory Assets and Deferred Debits |
1,504 |
1,301 |
|||||||||
Total Assets |
$ |
35,937 |
$ |
32,923 |
|||||||
LIABILITIES AND EQUITY |
|||||||||||
Current Liabilities |
$ |
3,687 |
$ |
3,392 |
|||||||
Long-term Debt |
13,094 |
12,892 |
|||||||||
Deferred Credits and Other Liabilities |
7,175 |
6,768 |
|||||||||
Preferred Stock of Subsidiaries |
562 |
339 |
|||||||||
Equity |
11,419 |
9,532 |
|||||||||
Total Liabilities and Equity |
$ |
35,937 |
$ |
32,923 |
Spectra Energy Corp | ||||||||||||||||
Distributable Cash Flow | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions) | ||||||||||||||||
Reported - These results include the impact of special items | ||||||||||||||||
Three Months Ended |
Nine Months Ended | |||||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||||
Net Income |
$ |
281 |
$ |
243 |
$ |
812 |
$ |
648 |
||||||||
Add: |
||||||||||||||||
Interest expense |
133 |
155 |
437 |
480 |
||||||||||||
Income tax expense |
10 |
70 |
160 |
164 |
||||||||||||
Depreciation and amortization |
193 |
188 |
582 |
574 |
||||||||||||
Foreign currency loss |
— |
4 |
— |
7 |
||||||||||||
Less: |
||||||||||||||||
Third party interest income |
1 |
— |
3 |
2 |
||||||||||||
EBITDA |
616 |
660 |
1,988 |
1,871 |
||||||||||||
Add: |
||||||||||||||||
Earnings from equity investments |
(54) |
(51) |
(110) |
(80) |
||||||||||||
Non-cash impairments at DCP |
3 |
3 |
10 |
197 |
||||||||||||
Distributions from equity investments |
36 |
59 |
133 |
183 |
||||||||||||
Empress non-cash items |
(2) |
(3) |
42 |
24 |
||||||||||||
Non-cash impairment at Ozark Gas Gathering |
— |
— |
— |
9 |
||||||||||||
Other |
30 |
7 |
51 |
30 |
||||||||||||
Less: |
||||||||||||||||
Interest expense |
133 |
155 |
437 |
480 |
||||||||||||
Equity AFUDC |
52 |
33 |
116 |
73 |
||||||||||||
Net cash paid (refund) for income taxes |
7 |
8 |
(3) |
(20) |
||||||||||||
Distributions to non-controlling interests |
62 |
47 |
176 |
140 |
||||||||||||
Maintenance capital expenditures |
173 |
209 |
417 |
481 |
||||||||||||
Total Distributable Cash Flow |
$ |
202 |
$ |
223 |
$ |
971 |
$ |
1,080 |
||||||||
Spectra Energy Corp | ||||||||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||||||||
September 2016 Quarter-to-Date | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except per-share amounts) | ||||||||||||||||
Reported |
Less: |
Ongoing | ||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
||||||||||||||||
Spectra Energy Partners |
$ |
464 |
$ |
(38) |
A |
$ |
502 |
|||||||||
Distribution |
77 |
— |
77 |
|||||||||||||
Western Canada Transmission & Processing |
93 |
(16) |
B |
109 |
||||||||||||
Field Services |
12 |
(3) |
C |
15 |
||||||||||||
Total Reportable Segment EBITDA |
646 |
(57) |
703 |
|||||||||||||
Other |
(30) |
(19) |
D |
(11) |
||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
616 |
$ |
(76) |
$ |
692 |
||||||||||
EARNINGS |
||||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
616 |
$ |
(76) |
$ |
692 |
||||||||||
Depreciation and Amortization |
(193) |
— |
(193) |
|||||||||||||
Interest Expense |
(133) |
— |
(133) |
|||||||||||||
Interest Income and Other |
1 |
— |
1 |
|||||||||||||
Income Tax Benefit (Expense) |
(10) |
41 |
(51) |
|||||||||||||
Total Net Income |
281 |
(35) |
316 |
|||||||||||||
Total Net Income - Noncontrolling Interests |
(86) |
10 |
(96) |
|||||||||||||
Total Net Income - Controlling Interests |
$ |
195 |
$ |
(25) |
$ |
220 |
||||||||||
EARNINGS PER SHARE, BASIC |
$ |
0.28 |
$ |
(0.03) |
$ |
0.31 |
||||||||||
EARNINGS PER SHARE, DILUTED |
$ |
0.28 |
$ |
(0.03) |
$ |
0.31 |
||||||||||
A - Inspection and repair costs related to Texas Eastern pipeline incident in Pennsylvania. | ||||||||||||||||
B - Employee and overhead reduction costs, and the effects of flooding in British Columbia. | ||||||||||||||||
C - Non-cash asset impairment and write-offs, employee and overhead reduction costs, partially offset by gain on sale of an asset. | ||||||||||||||||
D - Transaction costs. | ||||||||||||||||
Weighted Average Shares - in millions |
||||||||||||||||
Basic |
701 |
|||||||||||||||
Diluted |
703 |
Spectra Energy Corp | ||||||||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||||||||
September 2015 Quarter-to-Date | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except per-share amounts) | ||||||||||||||||
Reported |
Less: |
Ongoing | ||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
||||||||||||||||
Spectra Energy Partners |
$ |
488 |
$ |
— |
$ |
488 |
||||||||||
Distribution |
70 |
— |
70 |
|||||||||||||
Western Canada Transmission & Processing |
117 |
— |
117 |
|||||||||||||
Field Services |
(3) |
26 |
A |
(29) |
||||||||||||
Total Reportable Segment EBITDA |
672 |
26 |
646 |
|||||||||||||
Other |
(12) |
— |
(12) |
|||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
660 |
$ |
26 |
$ |
634 |
||||||||||
EARNINGS |
||||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
660 |
$ |
26 |
$ |
634 |
||||||||||
Depreciation and Amortization |
(188) |
— |
(188) |
|||||||||||||
Interest Expense |
(155) |
— |
(155) |
|||||||||||||
Interest Income and Other |
(4) |
— |
(4) |
|||||||||||||
Income Tax Expense |
(70) |
(8) |
(62) |
|||||||||||||
Total Net Income |
243 |
18 |
225 |
|||||||||||||
Total Net Income - Noncontrolling Interests |
(69) |
— |
(69) |
|||||||||||||
Total Net Income - Controlling Interests |
$ |
174 |
$ |
18 |
$ |
156 |
||||||||||
EARNINGS PER SHARE, BASIC |
$ |
0.26 |
$ |
0.03 |
$ |
0.23 |
||||||||||
EARNINGS PER SHARE, DILUTED |
$ |
0.26 |
$ |
0.03 |
$ |
0.23 |
||||||||||
A - Employee and overhead reduction costs, gain on sale of an asset and non-cash goodwill impairment. | ||||||||||||||||
Weighted Average Shares - in millions |
||||||||||||||||
Basic |
671 |
|||||||||||||||
Diluted |
672 |
Spectra Energy Corp | ||||||||||||||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | ||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||
(In millions) | ||||||||||||||||||||||||
Three Months Ended |
Three Months Ended | |||||||||||||||||||||||
Reported |
Less: |
Ongoing |
Reported |
Less: |
Ongoing | |||||||||||||||||||
Net Income |
$ |
281 |
$ |
(35) |
$ |
316 |
$ |
243 |
$ |
18 |
$ |
225 |
||||||||||||
Add: |
||||||||||||||||||||||||
Interest expense |
133 |
— |
133 |
155 |
— |
155 |
||||||||||||||||||
Income tax expense (benefit) |
10 |
(41) |
51 |
70 |
8 |
62 |
||||||||||||||||||
Depreciation and amortization |
193 |
— |
193 |
188 |
— |
188 |
||||||||||||||||||
Foreign currency loss |
— |
— |
— |
4 |
— |
4 |
||||||||||||||||||
Less: |
||||||||||||||||||||||||
Third party interest income |
1 |
— |
1 |
— |
— |
— |
||||||||||||||||||
EBITDA |
616 |
(76) |
692 |
660 |
26 |
634 |
||||||||||||||||||
Add: |
||||||||||||||||||||||||
Earnings from equity investments |
(54) |
— |
(54) |
(51) |
(29) |
(22) |
||||||||||||||||||
Non-cash impairment at DCP |
3 |
3 |
— |
3 |
3 |
— |
||||||||||||||||||
Distributions from equity investments |
36 |
— |
36 |
59 |
— |
59 |
||||||||||||||||||
Empress non-cash items |
(2) |
— |
(2) |
(3) |
— |
(3) |
||||||||||||||||||
Other |
30 |
— |
30 |
7 |
— |
7 |
||||||||||||||||||
Less: |
||||||||||||||||||||||||
Interest expense |
133 |
— |
133 |
155 |
— |
155 |
||||||||||||||||||
Equity AFUDC |
52 |
— |
52 |
33 |
— |
33 |
||||||||||||||||||
Net cash paid for income taxes |
7 |
— |
7 |
8 |
— |
8 |
||||||||||||||||||
Distributions to non-controlling interests |
62 |
— |
62 |
47 |
— |
47 |
||||||||||||||||||
Maintenance capital expenditures |
173 |
5 |
168 |
209 |
— |
209 |
||||||||||||||||||
Total Distributable Cash Flow |
$ |
202 |
$ |
(78) |
$ |
280 |
$ |
223 |
$ |
— |
$ |
223 |
||||||||||||
Spectra Energy Corp |
||
Distributable Cash Flow |
||
(In millions) |
||
2016e | ||
Total Reported Net Income |
$ 1,150 | |
Add: |
||
Interest expense |
625 | |
Income tax expense |
315 | |
Depreciation and amortization |
765 | |
EBITDA |
2,855 | |
Add: |
||
Net cash from equity investments |
85 | |
Other |
85 | |
Less: |
||
Interest expense |
625 | |
Equity AFUDC |
145 | |
Cash paid for income taxes |
15 | |
Distributions to non-controlling interests |
255 | |
Maintenance capital expenditures |
615 | |
Total Consolidated Distributable Cash Flow |
$ 1,370 | |
Coverage Ratio |
1.2x | |
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SOURCE Spectra Energy Corp
HOUSTON, Nov. 2, 2016 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) announced that the board of directors of its general partner declared a quarterly cash distribution to unitholders of $0.67625 per unit, an increase of 1.25 cents over the previous level of $0.66375 per unit. This is the 36th consecutive quarter that Spectra Energy Partners has increased its quarterly cash distribution. The cash distribution is payable on November 29, 2016, to unitholders of record at the close of business on November 14, 2016. This quarterly cash distribution equates to $2.705 per unit on an annual basis.
This information is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Under rules applicable to publicly-traded partnerships, our distributions to non-U.S. unitholders are subject to withholding tax at the highest effective applicable rate to the extent attributable to income that is effectively connected with the conduct of a U.S. trade or business. Given the uncertainty at the time of making distributions regarding the amount of any distribution that is attributable to income that is so effectively connected, we intend to treat all of our distributions as attributable to our U.S. operations, and as a result, the entire distribution will be subject to withholding.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
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SOURCE Spectra Energy Partners, LP
HOUSTON, Oct. 19, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) has declared a quarterly cash dividend on its common stock of $0.405 per share, or $1.62 per share on an annualized basis. The dividend is payable on December 6, 2016, to shareholders of record at the close of business on November 11, 2016.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include approximately 21,000 miles of natural gas and crude oil pipelines; approximately 300 billion cubic feet of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
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SOURCE Spectra Energy Corp
HOUSTON, Oct. 5, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) and Spectra Energy Partners (NYSE: SEP) will announce their third quarter 2016 earnings results before the market opens on Wednesday, November 2, 2016, and will hold a joint investor and analyst conference call at 8 a.m. CT that same day.
The webcast will be available via the Spectra Energy and Spectra Energy Partners Investors pages. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 70917863 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Friday, December 2, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Spectra Energy and Spectra Energy Partners Investors pages.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include approximately 21,000 miles of natural gas and crude oil pipelines; approximately 300 billion cubic feet of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
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SOURCE Spectra Energy Corp; Spectra Energy Partners, LP
HOUSTON, Aug. 9, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) Chief Financial Officer Pat Reddy will speak at the 2016 Goldman Sachs Power, Utilities, MLP and Pipeline Conference on Thursday, August 11, 2016. Reddy also serves as chief financial officer of Spectra Energy Partners (NYSE: SEP).
The panel is scheduled to begin at 9:45 a.m. ET and will be available via webcast. The panel and webcast link can be accessed via the Investors sections of www.spectraenergy.com. A replay of the webcast will be available for up to one month following the event.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include approximately 21,000 miles of natural gas and crude oil pipelines; approximately 300 billion cubic feet of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
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SOURCE Spectra Energy Corp; Spectra Energy Partners, LP
HOUSTON, Aug. 4, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) today announced that its indirect subsidiary, Westcoast Energy Inc., has completed the previously announced sale of its ownership interests in Spectra Energy's Canadian natural gas liquids (NGL) business to Plains Midstream Canada ULC, for a cash purchase price of approximately C$267 million (USD $204 million), including approximately C$67 million (USD $51 million) for inventory and working capital.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include approximately 21,000 miles of natural gas and crude oil pipelines; approximately 300 billion cubic feet of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
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SOURCE Spectra Energy Corp
HOUSTON, Aug. 3, 2016 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) today reported net income of $305 million, including net income from controlling interests of $287 million, for the second quarter ended June 30, 2016, with diluted earnings per limited partner unit of $0.71. The second quarter included a non-recurring special item of $6 million, which decreased diluted earnings per limited partner unit by $0.02.
Second Quarter Highlights:
Second quarter 2016 ongoing distributable cash flow was $281 million, compared with $321 million in the prior-year quarter. Distributions per limited partner unit for second quarter 2016 were $0.66375, compared with $0.61375 per limited partner unit in second quarter 2015.
For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $448 million, compared with $456 million in the prior-year quarter.
Ongoing net income from controlling interests was $293 million for the quarter, or $0.73 diluted earnings per limited partner unit, compared with $307 million, or $0.83 diluted earnings per limited partner unit, in the prior-year quarter. Net income from controlling interests was $287 million for the quarter, or $0.71 diluted earnings per limited partner unit, compared with $307 million, or $0.83 diluted earnings per limited partner unit, in the prior-year quarter.
CEO COMMENT
"Spectra Energy Partners once again demonstrated strong ongoing earnings and cash generation thanks to our solid, fee-based business model – one which has no direct commodity exposure and little volume exposure. Our robust expansion program continued to progress as expected with projects remaining on track for their respective in-service dates," said Greg Ebel, chief executive officer, Spectra Energy Partners. "We have increased our liquidity, enhanced our balance sheet and taken advantage of our access to attractive financing options in order to advance our continued growth."
"We also announced our 35th consecutive quarterly cash distribution increase today, confirming the plans we shared with investors at the start of the year and our portfolio strength and cash flow reliability," continued Ebel.
SEGMENT RESULTS
U.S. Transmission
Ongoing EBITDA from U.S. Transmission was $412 million in second quarter 2016, compared with $396 million in second quarter 2015. These results exclude a special item of $6 million in expense related to the Texas Eastern pipeline incident in Pennsylvania in second quarter 2016 and reflect increased earnings from expansion projects. These results were partially offset by a positive property tax adjustment in second quarter 2015.
Liquids
Liquids' second quarter 2016 EBITDA was $58 million, compared with $78 million in second quarter 2015. The decrease is due almost entirely to the absence of equity earnings from Sand Hills and Southern Hills natural gas liquids (NGL) pipelines, which Spectra Energy Partners owned until October 2015.
Other
"Other" net expenses were $22 million in second quarter 2016, compared with $18 million in second quarter 2015.
Interest Expense
Interest expense was $56 million in second quarter 2016, compared with $63 million in second quarter 2015, reflecting higher capitalized interest.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy Partners as of June 30, 2016, was $6.6 billion, with available liquidity of $2.0 billion. Including contributions from noncontrolling interests, Spectra Energy Partners has $1.8 billion of capital expansion spending planned in 2016, which will be funded through a combination of debt and equity.
Including contributions from noncontrolling interests of $81 million, total capital spending in second quarter 2016 was $559 million, consisting of $486 million of growth capital expenditures and $73 million of maintenance capital expenditures.
Through its "At the Market" (ATM) equity issuance program, Spectra Energy Partners has received net proceeds of $358 million this year.
In addition, in April 2016, Spectra Energy purchased 10.4 million newly issued common units and 0.2 million general partner units of Spectra Energy Partners for total net proceeds of $489 million.
EXPANSION PROJECT UPDATES
The Ozark Conversion project went into service on time and began flowing product in July. Spectra Energy Partners' other projects scheduled for 2016 in-service are on track to meet their timelines, including AIM, Loudon Expansion, Salem Lateral, and Express Enhancement.
Pre-construction work is currently under way on Sabal Trail, with full construction scheduled to begin in late summer, and in-service targeted for early summer 2017.
In July, the NEXUS and TEAL projects received a favorable FERC Draft Environmental Impact Statement (DEIS). The FERC Final Environmental Impact Statement is expected later this year, and the FERC Certificate is expected in first quarter 2017, keeping the projects on track to be in service in fourth quarter 2017.
Spectra Energy Partners also received the FERC Notice of Schedule for Access South, Adair Southwest, and the Lebanon Extension in July, and expects to receive the FERC Environmental Assessment soon, keeping these projects on target for in-service in the second half of 2017.
PennEast received its DEIS in July as well, and is expected to be in service in the second half of 2018.
Atlantic Bridge received its FERC Environmental Assessment in May and continues to move forward toward an in-service date in the second half of 2017.
The South Texas Expansion Project (STEP) in-service date has shifted to fourth quarter 2018 at the request of the customer, Comisión Federal de Electricidad (CFE), the Mexico state-owned power utility.
We continue to make progress on Access Northeast, and anticipate moving the project into execution later this year. Access Northeast is uniquely designed – both physically and contractually – to serve the needs of New England power generators, improve reliability, and save consumers an average of $1 billion per year in energy costs.
Spectra Energy continues working with co-developers Eversource and National Grid to advance state approvals for the customer agreements and is participating in the various processes currently under way:
The Access Northeast solution is designed to meet the needs of New England by maximizing the use of existing utility corridors and the Algonquin and Maritimes & Northeast pipelines, which directly connect to more than 60 percent of the existing ISO-New England gas-fired electric generation capacity and more than 80 percent of the new capacity that has recently cleared the ISO-New England forward capacity market. Access Northeast will cost-effectively deliver affordable natural gas when power generators need it, with new services to handle peak hours, seasonal needs, and quick starts to support intermittent wind and solar energy. In April, FERC issued the Notice of Intent to prepare an Environmental Impact Statement for Access Northeast, which continues to advance toward a late 2018 initial in-service date.
ADDITIONAL INFORMATION
Additional information about second quarter 2016 earnings can be obtained via the Spectra Energy website: www.spectraenergy.com.
The analyst call, held jointly with Spectra Energy, is scheduled for today, Wednesday, August 3, 2016, at 8 a.m. CT. The webcast will be available via the Spectra Energy and Spectra Energy Partners Investors pages. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 70917862 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Friday, September 2, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Spectra Energy and Spectra Energy Partners Investors pages.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests as a measure to evaluate operations of the partnership. This measure is a non-GAAP financial measure as it represents net income from controlling interests, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measure for ongoing net income from controlling interests is net income from controlling interests.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Partners, LP. Ongoing EBITDA represents EBITDA, excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Partners, LP's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Partners, LP is net income.
The primary performance measures used by us to evaluate segment performance are segment EBITDA and Other EBITDA. We consider segment EBITDA and Other EBITDA, which are the GAAP measures used to report segment results, to be good indicators of each segment's operating performance from its continuing operations as they represent the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA and Other EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA as a measure of performance. Ongoing segment EBITDA is a non-GAAP financial measure, as it represents reported segment EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's ongoing performance across periods. The most directly comparable GAAP measure for ongoing segment EBITDA is segment EBITDA.
We also present Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the partnership to support distribution growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF, excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by distributions declared on partnership units. The most directly comparable GAAP measure for DCF coverage is Earnings-Per-Unit (EPU).
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other partnerships because other partnerships may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2015 Form 10-K, filed on February 25, 2016, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
Spectra Energy Partners, LP | ||||||||||||||||
Quarterly Highlights | ||||||||||||||||
June 2016 | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except per-unit amounts) | ||||||||||||||||
Reported - These results include the impact of special items | ||||||||||||||||
Three Months Ended |
Six Months Ended | |||||||||||||||
June 30, |
June 30, | |||||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||||
INCOME |
||||||||||||||||
Operating Revenues |
$ |
618 |
$ |
603 |
$ |
1,242 |
$ |
1,209 |
||||||||
Total Reportable Segment EBITDA |
464 |
474 |
931 |
927 |
||||||||||||
Net Income - Controlling Interests |
287 |
307 |
585 |
600 |
||||||||||||
EBITDA BY BUSINESS SEGMENT |
||||||||||||||||
U.S. Transmission |
$ |
406 |
$ |
396 |
$ |
817 |
$ |
785 |
||||||||
Liquids |
58 |
78 |
114 |
142 |
||||||||||||
Total Reportable Segment EBITDA |
464 |
474 |
931 |
927 |
||||||||||||
Other EBITDA |
(22) |
(18) |
(42) |
(35) |
||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
442 |
$ |
456 |
$ |
889 |
$ |
892 |
||||||||
PARTNERS' CAPITAL |
||||||||||||||||
Declared Cash Distribution per Limited Partner Unit |
$ |
0.66375 |
$ |
0.61375 |
$ |
1.31500 |
$ |
1.21500 |
||||||||
Weighted Average Units Outstanding |
||||||||||||||||
Limited Partner Units |
298 |
296 |
292 |
296 |
||||||||||||
General Partner Units |
6 |
6 |
6 |
6 |
||||||||||||
DISTRIBUTABLE CASH FLOW |
||||||||||||||||
Distributable Cash Flow |
$ |
275 |
$ |
321 |
$ |
646 |
$ |
675 |
||||||||
CAPITAL AND INVESTMENT EXPENDITURES (a) |
||||||||||||||||
Capital expenditures - U.S. Transmission |
$ |
986 |
$ |
593 |
||||||||||||
Capital expenditures - Liquids |
37 |
11 |
||||||||||||||
Investment expenditures - Sand Hills/Southern Hills/SESH/Penn East/Nexus |
112 |
34 |
||||||||||||||
Total |
$ |
1,135 |
$ |
638 |
||||||||||||
U.S. TRANSMISSION |
||||||||||||||||
Operating Revenues |
$ |
529 |
$ |
509 |
$ |
1,067 |
$ |
1,031 |
||||||||
Operating Expenses |
||||||||||||||||
Operating, Maintenance and Other |
183 |
156 |
355 |
327 |
||||||||||||
Other Income and Expenses |
60 |
43 |
105 |
81 |
||||||||||||
EBITDA |
$ |
406 |
$ |
396 |
$ |
817 |
$ |
785 |
||||||||
LIQUIDS |
||||||||||||||||
Operating Revenues |
$ |
89 |
$ |
94 |
$ |
175 |
$ |
178 |
||||||||
Operating Expenses |
||||||||||||||||
Operating, Maintenance and Other |
31 |
34 |
62 |
68 |
||||||||||||
Other Income and Expenses |
— |
18 |
1 |
32 |
||||||||||||
EBITDA |
$ |
58 |
$ |
78 |
$ |
114 |
$ |
142 |
||||||||
Express Pipeline Revenue Receipts, MBbl/d (b) |
233 |
235 |
233 |
242 |
||||||||||||
Platte PADD II Deliveries, MBbl/d |
143 |
172 |
132 |
170 |
||||||||||||
Canadian Dollar Exchange Rate, Average |
1.29 |
1.23 |
1.33 |
1.23 |
||||||||||||
June 30, |
December 31, | |||||||||||||||
2016 |
2015 | |||||||||||||||
Debt |
$ |
6,576 |
$ |
6,604 |
||||||||||||
Actual Units Outstanding (c) |
309 |
291 |
||||||||||||||
(a) Excludes contributions received from noncontrolling interests of $176 million in 2016 and $58 million in 2015. | ||||||||||||||||
(b) Thousand barrels per day. | ||||||||||||||||
(c) Increase in 2016 resulted from the "At the Market" equity issuance program and equity issuance to Spectra Energy Corp in April 2016. |
Spectra Energy Partners, LP | |||||||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
(In millions) | |||||||||||||||||||
Reported - These results include the impact of special items | |||||||||||||||||||
Three Months Ended June 30, |
Six Months Ended June 30, |
||||||||||||||||||
2016 |
2015 |
2016 |
2015 |
||||||||||||||||
Operating Revenues |
$ |
618 |
$ |
603 |
$ |
1,242 |
$ |
1,209 |
|||||||||||
Operating Expenses |
313 |
281 |
613 |
576 |
|||||||||||||||
Operating Income |
305 |
322 |
629 |
633 |
|||||||||||||||
Other Income and Expenses |
61 |
62 |
108 |
111 |
|||||||||||||||
Interest Expense |
56 |
63 |
112 |
120 |
|||||||||||||||
Earnings Before Income Taxes |
310 |
321 |
625 |
624 |
|||||||||||||||
Income Tax Expense |
5 |
5 |
9 |
7 |
|||||||||||||||
Net Income |
305 |
316 |
616 |
617 |
|||||||||||||||
Net Income - Noncontrolling Interests |
18 |
9 |
31 |
17 |
|||||||||||||||
Net Income - Controlling Interests |
$ |
287 |
$ |
307 |
$ |
585 |
$ |
600 |
Spectra Energy Partners, LP | |||||||||||
Condensed Consolidated Balance Sheets | |||||||||||
(Unaudited) | |||||||||||
(In millions) | |||||||||||
June 30, |
December 31, | ||||||||||
2016 |
2015 | ||||||||||
ASSETS |
|||||||||||
Current Assets |
$ |
553 |
$ |
544 |
|||||||
Investments and Other Assets |
4,312 |
4,180 |
|||||||||
Net Property, Plant and Equipment |
14,844 |
13,837 |
|||||||||
Regulatory Assets and Deferred Debits |
324 |
290 |
|||||||||
Total Assets |
$ |
20,033 |
$ |
18,851 |
|||||||
LIABILITIES AND EQUITY |
|||||||||||
Current Liabilities |
$ |
1,401 |
$ |
1,471 |
|||||||
Long-term Debt |
5,861 |
5,845 |
|||||||||
Deferred Credits and Other Liabilities |
198 |
189 |
|||||||||
Equity |
12,573 |
11,346 |
|||||||||
Total Liabilities and Equity |
$ |
20,033 |
$ |
18,851 |
Spectra Energy Partners, LP | ||||||||||
Distributable Cash Flow | ||||||||||
(Unaudited) | ||||||||||
(Dollars in Millions, except where noted)
Reported – These results include the impact of special items | ||||||||||
Three Months Ended |
Six Months Ended |
|||||||||
2016 |
2015 |
2016 |
2015 |
|||||||
Net Income |
$ 305 |
$ 316 |
$ 616 |
$ 617 |
||||||
Add: |
||||||||||
Interest expense |
56 |
63 |
112 |
120 |
||||||
Income tax expense |
5 |
5 |
9 |
7 |
||||||
Depreciation and amortization |
77 |
73 |
154 |
146 |
||||||
Foreign currency (gain) loss |
1 |
- |
- |
3 |
||||||
Less: |
||||||||||
Third party interest income |
2 |
1 |
2 |
1 |
||||||
EBITDA |
442 |
456 |
889 |
892 |
||||||
Add: |
||||||||||
Earnings from equity investments |
(30) |
(45) |
(57) |
(85) |
||||||
Distributions from equity investments |
32 |
70 |
97 |
124 |
||||||
Non-cash impairment at Ozark Gas Gathering |
- |
- |
- |
9 |
||||||
Other |
1 |
3 |
3 |
6 |
||||||
Less: |
||||||||||
Interest expense |
56 |
63 |
112 |
120 |
||||||
Equity AFUDC |
29 |
16 |
46 |
27 |
||||||
Net cash paid for income taxes |
4 |
2 |
5 |
7 |
||||||
Distributions to non-controlling interests |
8 |
9 |
15 |
16 |
||||||
Maintenance capital expenditures |
73 |
73 |
108 |
101 |
||||||
Total Distributable Cash Flow |
$ 275 |
$ 321 |
$ 646 |
$ 675 |
||||||
Spectra Energy Partners, LP |
|||||||||||||||
Reported to Ongoing Earnings Reconciliation |
|||||||||||||||
June 2016 Quarter-to-date |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In millions) |
|||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
Reported Earnings |
Less: Special Items |
Ongoing Earnings |
||||||||||||
U.S. Transmission |
$ |
406 |
$ |
(6) |
A |
$ |
412 |
||||||||
Liquids |
58 |
— |
58 |
||||||||||||
Total Reportable Segment EBITDA |
464 |
(6) |
470 |
||||||||||||
Other |
(22) |
— |
(22) |
||||||||||||
Total Reportable Segment and other EBITDA |
$ |
442 |
$ |
(6) |
$ |
448 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
442 |
$ |
(6) |
$ |
448 |
|||||||||
Depreciation and Amortization |
(77) |
— |
(77) |
||||||||||||
Interest Expense |
(56) |
— |
(56) |
||||||||||||
Other Income and Expenses |
1 |
— |
1 |
||||||||||||
Income Tax Expense |
(5) |
— |
(5) |
||||||||||||
Total Net Income |
305 |
(6) |
311 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(18) |
— |
(18) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
287 |
$ |
(6) |
$ |
293 |
|||||||||
A - Inspection and repair costs related to Texas Eastern pipeline incident in Pennsylvania |
Spectra Energy Partners, LP |
||||||||
Reported to Ongoing Earnings Reconciliation |
||||||||
June 2015 Quarter-to-date |
||||||||
(Unaudited) |
||||||||
(In millions) |
||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
Reported/ Ongoing Earnings |
|||||||
U.S. Transmission |
$ |
396 |
||||||
Liquids |
78 |
|||||||
Total Reportable Segment EBITDA |
474 |
|||||||
Other |
(18) |
|||||||
Total Reportable Segment and other EBITDA |
$ |
456 |
||||||
EARNINGS |
||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
456 |
||||||
Depreciation and Amortization |
(73) |
|||||||
Interest Expense |
(63) |
|||||||
Other Income and Expenses |
1 |
|||||||
Income Tax Expense |
(5) |
|||||||
Total Net Income |
316 |
|||||||
Total Net Income - Noncontrolling Interests |
(9) |
|||||||
Total Net Income - Controlling Interests |
$ |
307 |
||||||
Spectra Energy Partners, LP | ||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | ||||||||
Unaudited | ||||||||
(In millions) | ||||||||
Quarter-To-Date |
Quarter-To-Date | |||||||
June 30, 2016 |
June 30, 2015 | |||||||
Reported |
Less: |
Ongoing |
Reported/ | |||||
Net Income |
$ 305 |
$ (6) |
$ 311 |
$ 316 | ||||
Add: |
||||||||
Interest expense |
56 |
- |
56 |
63 | ||||
Income tax expense |
5 |
- |
5 |
5 | ||||
Depreciation and amortization |
77 |
- |
77 |
73 | ||||
Foreign currency loss |
1 |
- |
1 |
- | ||||
Less: |
||||||||
Third party interest income |
2 |
- |
2 |
1 | ||||
EBITDA |
442 |
(6) |
448 |
456 | ||||
Add: |
||||||||
Earnings from equity investments |
(30) |
- |
(30) |
(45) | ||||
Distributions from equity investments |
32 |
- |
32 |
70 | ||||
Other |
1 |
- |
1 |
3 | ||||
Less: |
||||||||
Interest expense |
56 |
- |
56 |
63 | ||||
Equity AFUDC |
29 |
- |
29 |
16 | ||||
Net cash paid for income taxes |
4 |
- |
4 |
2 | ||||
Distributions to non-controlling interests |
8 |
- |
8 |
9 | ||||
Maintenance capital expenditures |
73 |
- |
73 |
73 | ||||
Total Distributable Cash Flow |
$ 275 |
$ (6) |
$ 281 |
$ 321 | ||||
Logo - http://photos.prnewswire.com/prnh/20071107/CLW064
SOURCE Spectra Energy Partners, LP
HOUSTON, Aug. 3, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) today reported net income of $221 million, including net income from controlling interests of $149 million, for the second quarter ended June 30, 2016, with diluted earnings per share of $0.21. The second quarter included non-recurring special items. After income taxes of $12 million, non-recurring special items decreased diluted earnings per share by $0.03.
Second Quarter Highlights:
For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $655 million, compared with $652 million in the prior-year quarter.
Ongoing distributable cash flow for the quarter was $271 million, compared with $285 million in the same quarter last year.
For the quarter, ongoing net income from controlling interests was $169 million, or $0.24 diluted earnings per share, compared with $156 million, or $0.23 diluted earnings per share in second quarter 2015. Net income from controlling interests was $149 million, or $0.21 diluted earnings per share, compared with $18 million, or $0.03 diluted earnings per share in second quarter 2015.
CEO COMMENT
"Spectra Energy achieved another solid quarter thanks to the strength of our diversified portfolio, and our earnings remain in line with the overall expectations we set at the beginning of the year," said Greg Ebel, chief executive officer, Spectra Energy. "Not only are we making significant progress advancing our projects already in execution, but our project backlog continues to grow, reaching $10 billion this quarter. Notably, we secured the $1.5 billion Valley Crossing Pipeline project to serve Mexico's developing natural gas market. Our excellent liquidity and investment-grade balance sheet, as well as our access to multiple financing options, continue to be significant competitive advantages. These advantages, combined with our limited commodity exposure, give us confidence in our ability to deliver on our commitments to our investors."
EFFECTS OF SPECIAL ITEMS
Second Quarter 2016 |
||||||
($MM) |
Segment |
EBITDA |
Income |
Net |
DCF | |
Ongoing |
$ 655 |
$ (64) |
$ 169 |
$ 271 | ||
Adjustments related to Special Items |
||||||
Costs related to Texas Eastern pipeline incident |
||||||
Self-insurance reserve |
Other |
$ (10) |
$ 4 |
$ (6) |
$ (10) | |
Inspection and repair costs |
SEP |
(6) |
2 |
(3)(2) |
(6) | |
Effects of flooding in British Columbia |
W. Canada |
(3) |
1 |
(2) |
(3) | |
Employee and overhead reduction costs |
W. Canada |
(6) |
2 |
(4) |
(6) | |
Employee and overhead reduction costs |
Field Services |
(5) |
2 |
(3) |
- | |
Loss on asset sale |
Field Services |
(3) |
1 |
(2) |
- | |
Total Special Items |
$ (33) |
$ 12 |
$ (20) |
$ (25) | ||
Reported |
$ 622 |
$ (52) |
$ 149 |
$ 246 | ||
(1) Represents net income from controlling interests (2) Net of non-controlling interests of $1 million |
Second Quarter 2015 |
|||||
($MM) |
Segment |
EBITDA |
Income |
Net |
DCF |
Ongoing |
$ 652 |
$ (72) |
$ 156 |
$ 285 | |
Adjustments related to Special Items |
|||||
Employee and overhead reduction costs |
W. Canada |
$ (11) |
$ 3 |
$ (8) |
$ (11) |
Goodwill impairment |
Field Services |
(194) |
72 |
(122) |
- |
Loss on asset sales |
Field Services |
(12) |
4 |
(8) |
- |
Total Special Items |
$ (217) |
$ 79 |
$ (138) |
$ (11) | |
Reported |
$ 435 |
$ 7 |
$ 18 |
$ 274 | |
(1) Represents net income from controlling interests |
SEGMENT RESULTS
Spectra Energy Partners
Ongoing EBITDA from Spectra Energy Partners was $477 million in second quarter 2016, compared with $478 million in second quarter 2015. Second quarter 2016 results exclude a special item of $6 million in expense. These results reflect increased earnings from expansion projects and the absence of equity earnings from Sand Hills and Southern Hills natural gas liquids (NGL) pipelines, which Spectra Energy Partners owned until October 2015. Earnings from these NGL pipeline interests are now reflected in the Field Services segment. These results were partially offset by a positive property tax adjustment in second quarter 2015.
Distribution
Despite a lower Canadian dollar, Distribution second quarter 2016 EBITDA was $104 million, compared with $98 million in second quarter 2015. This increase was mainly due to incremental earnings from the 2015 Dawn-Parkway expansion project and higher storage margins, as well as colder weather.
Western Canada Transmission & Processing
Ongoing EBITDA from Western Canada Transmission & Processing was $106 million in second quarter 2016, compared with $115 million in second quarter 2015. The 2016 and 2015 periods exclude special items of $9 million and $11 million in expenses, respectively. In line with our expectations, the segment's results reflect lower gathering and processing revenues, lower earnings at Empress, and a lower Canadian dollar, largely offset by lower plant turnaround costs.
Field Services
Ongoing EBITDA from Field Services was $(6) million in second quarter 2016, compared with $(27) million in second quarter 2015. The 2016 and 2015 periods exclude special items of $8 million and $206 million in expenses, respectively. The results for the quarter reflect higher earnings attributable to favorable contract realignment efforts, continued cost-saving initiatives and asset growth. These increases were partially offset by lower commodity prices and lower-margin volume declines. As a reminder, Spectra Energy's EBITDA from Field Services represents the company's 50 percent share of DCP Midstream's net income plus gains from DPM unit issuances.
During the second quarters of 2016 and 2015, respectively, NGL prices averaged $0.46 per gallon versus $0.48 per gallon, NYMEX natural gas averaged $1.95 per million British thermal units (MMBtu) versus $2.64 per MMBtu, and crude oil averaged approximately $46 per barrel versus $58 per barrel.
Other
Ongoing net expenses from "Other" were $26 million and $12 million in the second quarters of 2016 and 2015, respectively. The 2016 period excludes a special item of $10 million in expense. These results reflect higher employee benefits costs, driven by an improvement in the company's stock price, and an increase in business development costs. "Other" primarily consists of corporate expenses, including benefits and captive insurance.
Interest Expense
Interest expense was $153 million in second quarter 2016, compared with $166 million in second quarter 2015, reflecting higher capitalized interest.
Income Tax Expense
Income tax expense was $52 million in second quarter 2016, compared with an income tax benefit of $7 million in second quarter 2015, with effective tax rates of 19 percent and negative 10 percent, respectively. The 2015 period reflects a $72 million tax benefit reported as a special item related to a goodwill impairment at DCP Midstream.
Foreign Currency
Net income from controlling interests for the quarter was higher by $2 million due to a lower Canadian dollar.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy as of June 30, 2016, was $14.8 billion, with available liquidity of $3.5 billion. Including contributions from noncontrolling interests, Spectra Energy has $3.0 billion of capital expansion spending planned in 2016, $1.8 billion of which will be at Spectra Energy Partners.
Including contributions from noncontrolling interests of $81 million, total capital spending in second quarter 2016 was $860 million, comprised of $704 million of growth capital expenditures and $156 million of maintenance capital expenditures.
In April 2016, Spectra Energy issued 16.1 million common shares to the public for total net proceeds of $479 million. The proceeds were used to purchase 10.4 million common units from Spectra Energy Partners.
EXPANSION PROJECT UPDATES
Spectra Energy continues to make progress on securing $35 billion in new projects by the end of the decade. At the end of second quarter 2016, the company had:
Spectra Energy Partners
The Ozark Conversion project went into service on time and began flowing product in July. Spectra Energy Partners' other projects scheduled for 2016 in-service are on track to meet their timelines, including AIM, Loudon Expansion, Salem Lateral, and Express Enhancement.
Pre-construction work is currently under way on Sabal Trail, with full construction scheduled to begin in late summer, and in-service targeted for early summer 2017.
In July, the NEXUS and TEAL projects received a favorable FERC Draft Environmental Impact Statement (DEIS). The FERC Final Environmental Impact Statement is expected later this year, and the FERC Certificate is expected in first quarter 2017, keeping the projects on track to be in service in fourth quarter 2017.
Spectra Energy Partners also received the FERC Notice of Schedule for Access South, Adair Southwest, and the Lebanon Extension in July, and expects to receive the FERC Environmental Assessment soon, keeping these projects on target for in-service in the second half of 2017.
PennEast received its DEIS in July as well, and is expected to be in service in the second half of 2018.
Atlantic Bridge received its FERC Environmental Assessment in May and continues to move forward toward an in-service date in the second half of 2017.
The South Texas Expansion Project (STEP) in-service date has shifted to fourth quarter 2018 to be in line with our expected in-service date for the Valley Crossing Pipeline project.
We continue to make progress on Access Northeast, and anticipate moving the project into execution later this year. Access Northeast is uniquely designed – both physically and contractually – to serve the needs of New England power generators, improve reliability, and save consumers an average of $1 billion per year in energy costs.
Spectra Energy continues working with co-developers Eversource and National Grid to advance state approvals for the customer agreements and is participating in the various processes currently under way:
The Access Northeast solution is designed to meet the needs of New England by maximizing the use of existing utility corridors and the Algonquin and Maritimes & Northeast pipelines, which directly connect to more than 60 percent of the existing ISO-New England gas-fired electric generation capacity and more than 80 percent of the new capacity that has recently cleared the ISO-New England forward capacity market. Access Northeast will cost-effectively deliver affordable natural gas when power generators need it, with new services to handle peak hours, seasonal needs, and quick starts to support intermittent wind and solar energy. In April, FERC issued the Notice of Intent to prepare an Environmental Impact Statement for Access Northeast, which continues to advance toward a late 2018 initial in-service date.
Distribution
The 2016 and 2017 Dawn-Parkway expansions are in construction and are on schedule for their respective in-service dates. Construction also continues on the Burlington-Oakville expansion, which is expected to be in service later this year.
Western Canada
The RAM project is proceeding on schedule, and will phase in from 2016 through 2018, and the High Pine in-service date moved to the first half of 2017 due to the National Energy Board (NEB) review.
The Jackfish Lake project received NEB approval in July, and is anticipated to be placed into service in first quarter 2017, earlier than originally expected.
Projects Moved into Execution in Second Quarter
In June, Spectra Energy was named the successful bidder in the Nueces to Brownsville RFP process conducted by Comisión Federal de Electricidad (CFE), the Mexico state-owned power utility. The Valley Crossing Pipeline project is a $1.5 billion intrastate natural gas pipeline system in South Texas that will help meet Mexico's growing electric generation needs. The approximately 170-mile pipeline, which will have a capacity of 2.6 billion cubic feet per day (Bcf/d) and is scheduled for in-service in fourth quarter 2018, is underpinned by a long-term, fee-based, U.S. dollar-denominated contract with CFE. Valley Crossing will also construct and operate a header system of more than 5 Bcf/d near the Agua Dulce Hub. This project positions Spectra Energy to pursue other incremental upstream regional business as Mexico reforms its energy industry.
The C$265 million Panhandle Reinforcement project is a pipeline expansion to serve incremental industrial market growth in southwestern Ontario. Union Gas submitted the Ontario Energy Board application in June and expects approval in first quarter 2017, with in-service by the end of 2017.
Spectra Energy also filed a FERC application for the Bayway Lateral in July and expects to have this $30 million project in service in the first half of 2018. This lateral, with capacity of 300 million cubic feet per day, will serve a refinery and a cogeneration facility in New Jersey.
ADDITIONAL INFORMATION
Additional information about second quarter 2016 earnings can be obtained via the Spectra Energy website: www.spectraenergy.com.
The analyst call, held jointly with Spectra Energy Partners, is scheduled for today, Wednesday, August 3, 2016, at 8 a.m. CT. The webcast will be available via the Spectra Energy and Spectra Energy Partners Investors pages. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 70917862 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Friday, September 2, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Spectra Energy and Spectra Energy Partners Investors pages.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests and ongoing diluted EPS as measures to evaluate operations of the company. These measures are non-GAAP financial measures as they represent net income from controlling interests and diluted EPS, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests and ongoing diluted EPS provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measures for ongoing net income from controlling interests and ongoing diluted EPS are net income from controlling interests and diluted EPS.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Corp. Ongoing EBITDA represents EBITDA, excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Corp's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Corp is net income.
The primary performance measures used by us to evaluate segment performance are segment EBITDA and Other EBITDA. We consider segment EBITDA and Other EBITDA, which are the GAAP measures used to report segment results, to be good indicators of each segment's operating performance from its continuing operations as they represent the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA and Other EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA and ongoing Other EBITDA (net expenses) as measures of performance. Ongoing segment EBITDA and ongoing Other EBITDA are non-GAAP financial measures, as they represent segment EBITDA and Other EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA and ongoing Other EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's or Other's ongoing performance across periods. The most directly comparable GAAP measures for ongoing segment EBITDA and ongoing Other EBITDA are segment EBITDA and Other EBITDA.
We also present Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the company to support dividend growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF, excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by dividends declared on common stock. The most directly comparable GAAP measure for DCF coverage is EPS.
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other companies because other companies may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2015 Form 10-K, filed on February 25, 2016, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com and www.spectraenergypartners.com.
Spectra Energy Corp | ||||||||||||||||
Quarterly Highlights | ||||||||||||||||
June 2016 | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except per-share amounts and where noted) | ||||||||||||||||
Reported - These results include the impact of special items | ||||||||||||||||
Three Months |
Six Months | |||||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||||
COMMON STOCK DATA |
||||||||||||||||
Earnings Per Share, Diluted |
$ |
0.21 |
$ |
0.03 |
$ |
0.56 |
$ |
0.42 |
||||||||
Dividends Per Share |
$ |
0.405 |
$ |
0.370 |
$ |
0.810 |
$ |
0.740 |
||||||||
Weighted-Average Shares Outstanding, Diluted |
701 |
672 |
688 |
672 |
||||||||||||
INCOME |
||||||||||||||||
Operating Revenues |
$ |
1,159 |
$ |
1,192 |
$ |
2,543 |
$ |
2,815 |
||||||||
Total Reportable Segment EBITDA |
658 |
447 |
1,427 |
1,238 |
||||||||||||
Net Income - Controlling Interests |
149 |
18 |
383 |
285 |
||||||||||||
EBITDA BY BUSINESS SEGMENT |
||||||||||||||||
Spectra Energy Partners |
$ |
471 |
$ |
478 |
$ |
944 |
$ |
933 |
||||||||
Distribution |
104 |
98 |
274 |
290 |
||||||||||||
Western Canada Transmission & Processing |
97 |
104 |
220 |
265 |
||||||||||||
Field Services |
(14) |
(233) |
(11) |
(250) |
||||||||||||
Total Reportable Segment EBITDA |
658 |
447 |
1,427 |
1,238 |
||||||||||||
Other EBITDA |
(36) |
(12) |
(55) |
(27) |
||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
622 |
$ |
435 |
$ |
1,372 |
$ |
1,211 |
||||||||
DISTRIBUTABLE CASH FLOW |
||||||||||||||||
Distributable Cash Flow |
$ |
246 |
$ |
274 |
$ |
769 |
$ |
852 |
||||||||
CAPITAL AND INVESTMENT EXPENDITURES |
||||||||||||||||
Spectra Energy Partners (a) |
$ |
1,135 |
$ |
638 |
||||||||||||
Distribution |
341 |
207 |
||||||||||||||
Western Canada Transmission & Processing |
133 |
149 |
||||||||||||||
Other |
23 |
29 |
||||||||||||||
Total Capital and Investment Expenditures (a) |
$ |
1,632 |
$ |
1,023 |
||||||||||||
Expansion and Investment (a) |
$ |
1,388 |
$ |
760 |
||||||||||||
Maintenance and Other |
244 |
263 |
||||||||||||||
Total Capital and Investment Expenditures (a) |
$ |
1,632 |
$ |
1,023 |
||||||||||||
June 30, |
December 31, | |||||||||||||||
2016 |
2015 | |||||||||||||||
CAPITALIZATION |
||||||||||||||||
Common Equity - Controlling Interests |
28.9 |
% |
26.6 |
% | ||||||||||||
Noncontrolling Interests and Preferred Stock |
15.0 |
% |
13.6 |
% | ||||||||||||
Total Debt |
56.1 |
% |
59.8 |
% | ||||||||||||
Total Debt |
$ |
14,765 |
$ |
14,656 |
||||||||||||
Book Value Per Share (b) |
$ |
10.84 |
$ |
9.73 |
||||||||||||
Actual Shares Outstanding (c) |
701 |
671 |
||||||||||||||
(a) Excludes contributions received from noncontrolling interests of $176 million in 2016 and $58 million in 2015. | ||||||||||||||||
(b) Represents controlling interests. | ||||||||||||||||
(c) Increase in 2016 resulted from a newly initiated "At the Market" equity issuance program in March 2016 and equity |
Spectra Energy Corp | ||||||||||||
Quarterly Highlights | ||||||||||||
June 2016 | ||||||||||||
(Unaudited) | ||||||||||||
(In millions, except where noted) | ||||||||||||
Reported - These results include the impact of special items | ||||||||||||
Three Months |
Six Months | |||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||
SPECTRA ENERGY PARTNERS |
||||||||||||
Operating Revenues |
$ |
618 |
$ |
603 |
$ |
1,242 |
$ |
1,209 | ||||
Operating Expenses |
||||||||||||
Operating, Maintenance and Other |
216 |
192 |
421 |
399 | ||||||||
Other Income and Expenses |
69 |
67 |
123 |
123 | ||||||||
EBITDA |
$ |
471 |
$ |
478 |
$ |
944 |
$ |
933 | ||||
Express Pipeline Revenue Receipts, MBbl/d (a) |
233 |
235 |
233 |
242 | ||||||||
Platte PADD II Deliveries, MBbl/d |
143 |
172 |
132 |
170 | ||||||||
DISTRIBUTION |
||||||||||||
Operating Revenues |
$ |
284 |
$ |
290 |
$ |
749 |
$ |
952 | ||||
Operating Expenses |
||||||||||||
Natural Gas Purchased |
91 |
103 |
306 |
486 | ||||||||
Operating, Maintenance and Other |
89 |
90 |
171 |
176 | ||||||||
Other Income and Expenses |
— |
1 |
2 |
— | ||||||||
EBITDA |
$ |
104 |
$ |
98 |
$ |
274 |
$ |
290 | ||||
Number of Customers, Thousands |
— |
— |
1,446 |
1,425 | ||||||||
Heating Degree Days, Fahrenheit |
1,032 |
866 |
4,347 |
5,125 | ||||||||
Pipeline Throughput, TBtu (b) |
155 |
132 |
385 |
460 | ||||||||
Canadian Dollar Exchange Rate, Average |
1.29 |
1.23 |
1.33 |
1.23 | ||||||||
WESTERN CANADA TRANSMISSION & PROCESSING |
||||||||||||
Operating Revenues |
$ |
258 |
$ |
304 |
$ |
563 |
$ |
674 | ||||
Operating Expenses |
||||||||||||
Natural Gas and Petroleum Products Purchased |
15 |
25 |
63 |
92 | ||||||||
Operating, Maintenance and Other |
148 |
174 |
285 |
321 | ||||||||
Other Income and Expenses |
2 |
(1) |
5 |
4 | ||||||||
EBITDA |
$ |
97 |
$ |
104 |
$ |
220 |
$ |
265 | ||||
Pipeline Throughput, TBtu |
214 |
220 |
466 |
476 | ||||||||
Volumes Processed, TBtu |
163 |
156 |
339 |
336 | ||||||||
Canadian Dollar Exchange Rate, Average |
1.29 |
1.23 |
1.33 |
1.23 | ||||||||
FIELD SERVICES |
||||||||||||
Earnings (loss) from Equity Investment in DCP Midstream, LLC |
$ |
(14) |
$ |
(233) |
$ |
(11) |
$ |
(250) | ||||
Natural Gas Gathered and Processed/Transported, TBtu/day (c) |
6.7 |
7.0 |
6.8 |
7.1 | ||||||||
Natural Gas Liquids Production, MBbl/d (c) |
416 |
408 |
399 |
404 | ||||||||
Average Natural Gas Price Per MMBtu (d) |
$ |
1.95 |
$ |
2.64 |
$ |
2.02 |
$ |
2.81 | ||||
Average Natural Gas Liquids Price Per Gallon (e) |
$ |
0.46 |
$ |
0.48 |
$ |
0.41 |
$ |
0.48 | ||||
Average Crude Oil Price Per Barrel (f) |
$ |
45.64 |
$ |
57.94 |
$ |
39.54 |
$ |
53.29 | ||||
(a) Thousand barrels per day. | ||||||||||||
(b) Trillion British thermal units. | ||||||||||||
(c) Reflects 100% of DCP Midstream volumes. | ||||||||||||
(d) Million British thermal units. Average price based on NYMEX Henry Hub. | ||||||||||||
(e) Does not reflect results of commodity hedges. | ||||||||||||
(f) Average price based on NYMEX calendar month. |
Spectra Energy Corp | ||||||||||||
Condensed Consolidated Statements of Operations | ||||||||||||
(Unaudited) | ||||||||||||
(In millions) | ||||||||||||
Reported - These results include the impact of special items | ||||||||||||
Three Months |
Six Months | |||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||
Operating Revenues |
$ |
1,159 |
$ |
1,192 |
$ |
2,543 |
$ |
2,815 | ||||
Operating Expenses |
788 |
786 |
1,678 |
1,868 | ||||||||
Operating Income |
371 |
406 |
865 |
947 | ||||||||
Other Income and Expenses |
55 |
(167) |
120 |
(123) | ||||||||
Interest Expense |
153 |
166 |
304 |
325 | ||||||||
Earnings Before Income Taxes |
273 |
73 |
681 |
499 | ||||||||
Income Tax Expense |
52 |
(7) |
150 |
94 | ||||||||
Net Income |
221 |
80 |
531 |
405 | ||||||||
Net Income - Noncontrolling Interests |
72 |
62 |
148 |
120 | ||||||||
Net Income - Controlling Interests |
$ |
149 |
$ |
18 |
$ |
383 |
$ |
285 |
Spectra Energy Corp | |||||||||
Condensed Consolidated Balance Sheets | |||||||||
(Unaudited) | |||||||||
(In millions) | |||||||||
June 30, |
December 31, | ||||||||
2016 |
2015 | ||||||||
ASSETS |
|||||||||
Current Assets |
$ |
1,637 |
$ |
1,648 | |||||
Investments and Other Assets |
7,247 |
7,056 | |||||||
Net Property, Plant and Equipment |
24,707 |
22,918 | |||||||
Regulatory Assets and Deferred Debits |
1,456 |
1,301 | |||||||
Total Assets |
$ |
35,047 |
$ |
32,923 | |||||
LIABILITIES AND EQUITY |
|||||||||
Current Liabilities |
$ |
2,786 |
$ |
3,392 | |||||
Long-term Debt |
13,584 |
12,892 | |||||||
Deferred Credits and Other Liabilities |
7,115 |
6,768 | |||||||
Preferred Stock of Subsidiaries |
339 |
339 | |||||||
Equity |
11,223 |
9,532 | |||||||
Total Liabilities and Equity |
$ |
35,047 |
$ |
32,923 |
Spectra Energy Corp | ||||||||||||
Distributable Cash Flow | ||||||||||||
(Unaudited) | ||||||||||||
(In millions) | ||||||||||||
Reported - These results include the impact of special items | ||||||||||||
Three Months Ended |
Six Months Ended | |||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||
Net Income |
$ |
221 |
$ |
80 |
$ |
531 |
$ |
405 | ||||
Add: |
||||||||||||
Interest expense |
153 |
166 |
304 |
325 | ||||||||
Income tax expense (benefit) |
52 |
(7) |
150 |
94 | ||||||||
Depreciation and amortization |
196 |
193 |
389 |
386 | ||||||||
Foreign currency (gain) loss |
2 |
4 |
— |
3 | ||||||||
Less: |
||||||||||||
Third party interest income |
2 |
1 |
2 |
2 | ||||||||
EBITDA |
622 |
435 |
1,372 |
1,211 | ||||||||
Add: |
||||||||||||
(Earnings) Loss from equity investments |
(16) |
(5) |
(56) |
(29) | ||||||||
Non-cash impairments at DCP |
— |
194 |
7 |
194 | ||||||||
Distributions from equity investments |
32 |
70 |
97 |
124 | ||||||||
Empress non-cash items |
12 |
1 |
44 |
23 | ||||||||
Non-cash impairment at Ozark Gas Gathering |
— |
— |
— |
9 | ||||||||
Other |
16 |
17 |
21 |
22 | ||||||||
Less: |
||||||||||||
Interest expense |
153 |
166 |
304 |
325 | ||||||||
Equity AFUDC |
39 |
24 |
64 |
40 | ||||||||
Net cash paid (refund) for income taxes |
12 |
18 |
(10) |
(28) | ||||||||
Distributions to non-controlling interests |
60 |
49 |
114 |
93 | ||||||||
Maintenance capital expenditures |
156 |
181 |
244 |
272 | ||||||||
Total Distributable Cash Flow |
$ |
246 |
$ |
274 |
$ |
769 |
$ |
852 |
Spectra Energy Corp | ||||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||||
June 2016 Quarter-to-date | ||||||||||||
(Unaudited) | ||||||||||||
(In millions, except per-share amounts) | ||||||||||||
Reported |
Less: |
Ongoing | ||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
||||||||||||
Spectra Energy Partners |
$ |
471 |
$ |
(6) |
A |
$ |
477 | |||||
Distribution |
104 |
— |
104 | |||||||||
Western Canada Transmission & Processing |
97 |
(9) |
B |
106 | ||||||||
Field Services |
(14) |
(8) |
C |
(6) | ||||||||
Total Reportable Segment EBITDA |
658 |
(23) |
681 | |||||||||
Other |
(36) |
(10) |
D |
(26) | ||||||||
Total Reportable Segment and Other EBITDA |
$ |
622 |
$ |
(33) |
$ |
655 | ||||||
EARNINGS |
||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
622 |
$ |
(33) |
$ |
655 | ||||||
Depreciation and Amortization |
(196) |
— |
(196) | |||||||||
Interest Expense |
(153) |
— |
(153) | |||||||||
Income Tax Benefit (Expense) |
(52) |
12 |
(64) | |||||||||
Total Net Income |
221 |
(21) |
242 | |||||||||
Total Net Income - Noncontrolling Interests |
(72) |
1 |
(73) | |||||||||
Total Net Income - Controlling Interests |
$ |
149 |
$ |
(20) |
$ |
169 | ||||||
EARNINGS PER SHARE, BASIC |
$ |
0.21 |
$ |
(0.03) |
$ |
0.24 | ||||||
EARNINGS PER SHARE, DILUTED |
$ |
0.21 |
$ |
(0.03) |
$ |
0.24 | ||||||
A - Inspection and repair costs related to Texas Eastern pipeline incident in Pennsylvania. | ||||||||||||
B - Employee and overhead reduction costs, and the effects of flooding in British Columbia. | ||||||||||||
C - Employee and overhead reduction costs, and loss on the sale of an asset. | ||||||||||||
D - Self-insurance reserve associated with Texas Eastern pipeline incident in Pennsylvania. | ||||||||||||
Weighted Average Shares (reported and ongoing) - in millions | ||||||||||||
Basic |
699 |
|||||||||||
Diluted |
701 |
Spectra Energy Corp | ||||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||||
June 2015 Quarter-to-date | ||||||||||||
(Unaudited) | ||||||||||||
(In millions, except per-share amounts) | ||||||||||||
Reported |
Less: |
Ongoing | ||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
||||||||||||
Spectra Energy Partners |
$ |
478 |
$ |
— |
$ |
478 | ||||||
Distribution |
98 |
— |
98 | |||||||||
Western Canada Transmission & Processing |
104 |
(11) |
A |
115 | ||||||||
Field Services |
(233) |
(206) |
B |
(27) | ||||||||
Total Reportable Segment EBITDA |
447 |
(217) |
664 | |||||||||
Other |
(12) |
— |
(12) | |||||||||
Total Reportable Segment and Other EBITDA |
$ |
435 |
$ |
(217) |
$ |
652 | ||||||
EARNINGS |
||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
435 |
$ |
(217) |
$ |
652 | ||||||
Depreciation and Amortization |
(193) |
— |
(193) | |||||||||
Interest Expense |
(166) |
— |
(166) | |||||||||
Interest Income and Other |
(3) |
— |
(3) | |||||||||
Income Tax Benefit (Expense) |
7 |
79 |
(72) | |||||||||
Total Net Income |
80 |
(138) |
218 | |||||||||
Total Net Income - Noncontrolling Interests |
(62) |
— |
(62) | |||||||||
Total Net Income - Controlling Interests |
$ |
18 |
$ |
(138) |
$ |
156 | ||||||
EARNINGS PER SHARE, BASIC |
$ |
0.03 |
$ |
(0.20) |
$ |
0.23 | ||||||
EARNINGS PER SHARE, DILUTED |
$ |
0.03 |
$ |
(0.20) |
$ |
0.23 | ||||||
A - Employee and overhead reduction costs. | ||||||||||||
B - Employee and overhead reduction costs, net losses on sale of assets and goodwill impairment. | ||||||||||||
Weighted Average Shares (reported and ongoing) - in millions | ||||||||||||
Basic |
671 |
|||||||||||
Diluted |
672 |
Spectra Energy Corp | ||||||||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | ||||||||||||||||||
Unaudited | ||||||||||||||||||
(In millions, except where noted) | ||||||||||||||||||
Three Months Ended |
Three Months Ended | |||||||||||||||||
Reported |
Less: |
Ongoing |
Reported |
Less: |
Ongoing | |||||||||||||
Net Income |
$ |
221 |
$ |
(21) |
$ |
242 |
$ |
80 |
$ |
(138) |
$ |
218 | ||||||
Add: |
||||||||||||||||||
Interest expense |
153 |
— |
153 |
166 |
— |
166 | ||||||||||||
Income tax expense (benefit) |
52 |
(12) |
64 |
(7) |
(79) |
72 | ||||||||||||
Depreciation and amortization |
196 |
— |
196 |
193 |
— |
193 | ||||||||||||
Foreign currency (gain) loss |
2 |
— |
2 |
4 |
— |
4 | ||||||||||||
Less: |
||||||||||||||||||
Third party interest income |
2 |
— |
2 |
1 |
— |
1 | ||||||||||||
EBITDA |
622 |
(33) |
655 |
435 |
(217) |
652 | ||||||||||||
Add: |
||||||||||||||||||
(Earnings) Loss from equity investments |
(16) |
8 |
(24) |
(5) |
12 |
(17) | ||||||||||||
Non-cash impairment at DCP |
— |
— |
194 |
194 |
— | |||||||||||||
Distributions from equity investments |
32 |
— |
32 |
70 |
— |
70 | ||||||||||||
Empress non-cash items |
12 |
— |
12 |
1 |
— |
1 | ||||||||||||
Other |
16 |
— |
16 |
17 |
— |
17 | ||||||||||||
Less: |
||||||||||||||||||
Interest expense |
153 |
— |
153 |
166 |
— |
166 | ||||||||||||
Equity AFUDC |
39 |
— |
39 |
24 |
— |
24 | ||||||||||||
Net cash paid (refund) for income taxes |
12 |
— |
12 |
18 |
— |
18 | ||||||||||||
Distributions to non-controlling interests |
60 |
— |
60 |
49 |
— |
49 | ||||||||||||
Maintenance capital expenditures |
156 |
— |
156 |
181 |
— |
181 | ||||||||||||
Total Distributable Cash Flow |
$ |
246 |
$ |
(25) |
$ |
271 |
$ |
274 |
$ |
(11) |
$ |
285 |
Spectra Energy Corp |
||
Distributable Cash Flow |
||
(In millions) |
||
2016e | ||
Total Reported Net Income |
$ 1,150 | |
Add: |
||
Interest expense |
625 | |
Income tax expense (benefit) |
315 | |
Depreciation and amortization |
765 | |
EBITDA |
2,855 | |
Add: |
||
Net cash from equity investments |
85 | |
Other |
85 | |
Less: |
||
Interest expense |
625 | |
Equity AFUDC |
145 | |
Cash paid for income taxes |
15 | |
Distributions to non-controlling interests |
255 | |
Maintenance capital expenditures |
615 | |
Total Consolidated Distributable Cash Flow |
$ 1,370 | |
Coverage Ratio |
1.2x |
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SOURCE Spectra Energy Corp
HOUSTON, Aug. 3, 2016 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) announced that the board of directors of its general partner declared a quarterly cash distribution to unitholders of $0.66375 per unit, an increase of 1.25 cents over the previous level of $0.65125 per unit. This is the 35th consecutive quarter that Spectra Energy Partners has increased its quarterly cash distribution. The cash distribution is payable on August 26, 2016, to unitholders of record at the close of business on August 15, 2016. This quarterly cash distribution equates to $2.655 per unit on an annual basis.
This information is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Under rules applicable to publicly-traded partnerships, our distributions to non-U.S. unitholders are subject to withholding tax at the highest effective applicable rate to the extent attributable to income that is effectively connected with the conduct of a U.S. trade or business. Given the uncertainty at the time of making distributions regarding the amount of any distribution that is attributable to income that is so effectively connected, we intend to treat all of our distributions as attributable to our U.S. operations, and as a result, the entire distribution will be subject to withholding.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
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SOURCE Spectra Energy Partners, LP
HOUSTON, July 6, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) and Spectra Energy Partners (NYSE: SEP) will announce their second quarter 2016 earnings results before the market opens on Wednesday, August 3, 2016, and will hold a joint investor and analyst conference call at 8 a.m. CT that same day.
The webcast will be available via the Spectra Energy and Spectra Energy Partners Investors pages. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 70917862 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Friday, September 2, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Spectra Energy and Spectra Energy Partners Investors pages.
Spectra Energy would like to remind investors and analysts that, in addition to its websites, Spectra Energy may use mobile apps (Invest SE and Invest SEP), or social media platforms, such as Twitter, Facebook, LinkedIn, StockTwits or YouTube, to release material corporate information.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com and www.spectraenergypartners.com.
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SOURCE Spectra Energy Corp; Spectra Energy Partners, LP
HOUSTON, July 5, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) has declared a quarterly cash dividend on its common stock of $0.405 per share, or $1.62 per share on an annualized basis. The dividend is payable on September 7, 2016, to shareholders of record at the close of business on August 12, 2016.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com and www.spectraenergypartners.com.
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SOURCE Spectra Energy Corp
HOUSTON, June 13, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) today announced that its subsidiary, Valley Crossing Pipeline, LLC, has been awarded a 168-mile intrastate natural gas pipeline project by the Comisión Federal de Electricidad (CFE) – Mexico's state-owned utility serving 37 million customers – to provide natural gas transportation services beginning in 2018 to meet Mexico's growing electric generation needs.
"Spectra Energy is pleased to have secured the bid to build and operate this critical infrastructure, which will provide clean-burning and reliable natural gas to support Mexico as its electric generators shift away from fuel oil and imported LNG," said Bill Yardley, president of U.S. Transmission and Storage for Spectra Energy. "Successfully securing this project adds to our already-strong asset portfolio, connects us to another key demand-pull market, and brings us closer to our goal of securing $35 billion in capital expansion projects by the end of this decade, with approximately $20 billion either in execution or in service since 2013."
Valley Crossing will construct and operate a header system of more than 5 billion cubic feet per day (Bcf/d) near the Agua Dulce Hub in Nueces County, Texas, as well as a 2.6 Bcf/d pipeline originating at that header and extending to Brownsville, Texas. There, the pipeline will connect with the Sur de Texas – Tuxpan pipeline, which will extend into Mexico.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
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SOURCE Spectra Energy Corp
HOUSTON, May 31, 2016 /PRNewswire/ -- Spectra Energy Partners' (NYSE: SEP) Bill Yardley will speak at the Master Limited Partnership Association (MLPA) 2016 Investor Conference on Thursday, June 2, 2016. Yardley is president of U.S. Transmission and Storage for Spectra Energy Corp (NYSE: SE), the general partner of Spectra Energy Partners.
The presentation is scheduled to begin at 3:30 p.m. ET and will be available via webcast. The presentation and webcast link can be accessed via the Spectra Energy Partners Investors section of Spectra Energy's website. A replay of the webcast will be available for up to one month following the event.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
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SOURCE Spectra Energy Partners, LP
HOUSTON, May 16, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) today announced that 10 children of company employees have been selected to receive up to $5,000 per year in scholarship funds toward undergraduate study at an accredited college or university in the U.S. or Canada.
"Spectra Energy is proud to continue our 50-plus year tradition of offering a scholarship program for the children of our employees. We are pleased to make an investment in the futures of these exceptional students who demonstrate so much potential," said Greg Ebel, chief executive officer of Spectra Energy. "This year's scholarship recipients excel academically and actively participate in their schools and local communities."
Recipients under the Spectra Energy Scholars Program are graduating high school/secondary school seniors and are chosen annually by an independent committee of judges. The committee selects recipients based on their performance in academics, leadership and participation in school and community activities, honors and awards, work experience and financial need. The scholarships will provide the students up to $20,000 during their four years of undergraduate study.
Two additional students were recognized for their achievements and will each receive a one-time, $2,500 scholarship.
2016 SCHOLARSHIP RECIPIENTS:
Morgan Barron of Brookhaven, MS – A student at Brookhaven Academy and the son of Lane and Becky Barron
McKinzie Chambers of Houston, TX – A student at Saint Agnes Academy and the daughter of Dawn Terrazas-Chambers
Sage Graham of Ethel, MS – A student at Ethel High School and the son of Lynn and Jennifer Graham
Brittany McLaren of Chatham, ON – A student at Chatham-Kent Secondary School and the daughter of David and Carla-Jo McLaren
Chukwuebuka Moneme of Waterloo, ON – A student of St. Davids Secondary School, Waterloo, ON and the son of Chuka and Adaora Moneme
Carys Owen of Chatham, ON – A student at Chatham-Kent Secondary School and the daughter of Jason and Deborah Owen
Sarah Price of Owingsville, KY – A student at Bath County High School and the daughter of Joe and Kim Price
Heather Raun of El Campo, TX – A student at El Campo High School and the daughter of Lance and Kim Raun
Christina Scherer of Scott City, MO – A student at Notre Dame Regional High School and the daughter of Chris and Donna Scherer
Jordan Sharpe of Hanover, ON – A student at John Diefenbaker Senior School and the daughter of Scott Sharpe and Tracy Napper-Sharpe
ONE-TIME RECIPIENTS:
Samantha Brownlee of North Bay, ON – A student at St. Joseph Scollard Hall and the daughter of Kathy Brownlee
Aubrey Goldman of Pulaski, TN – student at Richland High School daughter of Mike and Jennifer Goldman
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com.
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SOURCE Spectra Energy Corp
HOUSTON, May 4, 2016 /PRNewswire/ --
First Quarter Highlights:
Spectra Energy Partners, LP (NYSE: SEP) today reported first quarter 2016 distributable cash flow of $371 million, compared with $354 million in the prior-year quarter. Distributions per limited partner unit for first quarter 2016 were $0.65125, compared with $0.60125 per limited partner unit in first quarter 2015.
CEO COMMENT
"Spectra Energy Partners grew its earnings and distributable cash flow in the first quarter, despite the continuing weak energy sector fundamentals and a warm winter. Our results once again underline the reliability and strength of our business model," said Greg Ebel, chief executive officer, Spectra Energy Partners. "Our $6 billion of expansion projects continued to progress as expected during the quarter and will add incremental fee-based earnings and cash flow as they enter into service during the 2016-2019 period.
"Illustrating our confidence in the plans we shared with investors at the start of the year, we announced our 34th consecutive quarterly cash distribution increase today – representing more than eight years of steady growth," continued Ebel.
For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $447 million, compared with $445 million in the prior-year quarter.
Reported net income from controlling interests was $298 million for first quarter 2016, compared with $293 million in first quarter 2015. Ongoing net income from controlling interests was $298 million for the quarter, compared with $302 million in the prior-year quarter.
SEGMENT RESULTS
U.S. Transmission
Ongoing EBITDA from U.S. Transmission was $411 million in first quarter 2016, compared with $398 million in first quarter 2015. The 2015 period excludes a non-cash special item expense of $9 million. These results reflect increased earnings from expansion projects, partially offset by lower interruptible and short-term contract transportation revenue due to warmer weather.
Liquids
Liquids reported first quarter 2016 EBITDA of $56 million, compared with $64 million in first quarter 2015. The decrease is attributable to the absence of equity earnings from Sand Hills and Southern Hills natural gas liquids (NGL) pipelines, which the company owned until October 2015, partially offset by lower operating costs.
Other
"Other" reported net expenses of $20 million in first quarter 2016, compared with $17 million in first quarter 2015.
Interest Expense
Interest expense was $56 million in first quarter 2016, compared with $57 million in first quarter 2015, driven by higher capitalized interest, offset by higher average long-term debt balances.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy Partners as of March 31, 2016, was $7.0 billion, with available liquidity of $1.4 billion. Including contributions from noncontrolling interests, Spectra Energy Partners has $1.8 billion of capital expansion spending planned in 2016, which will be funded through a combination of debt and equity.
Through its "At the Market" (ATM) equity issuance program, Spectra Energy Partners has received net proceeds of $103 million this year.
In April 2016, Spectra Energy purchased 10.4 million newly issued common units and 0.2 million general partner units of Spectra Energy Partners for total net proceeds of $489 million.
Including contributions from noncontrolling interests of $95 million, total capital spending in first quarter 2016 was $400 million, composed of $365 million of growth capital expenditures and $35 million of maintenance capital expenditures.
EXPANSION PROJECT UPDATES
Spectra Energy Partners has advanced numerous projects across the system. Sabal Trail, a joint venture with NextEra Energy and Duke Energy, received its Certificate of Public Convenience and Necessity from the Federal Energy Regulatory Commission (FERC) in February. This approval authorizes Sabal Trail, subject to certain conditions, to proceed with construction in order to meet a May 2017 in-service date. On April 1, 2016, Sabal Trail ownership agreements were finalized with Spectra Energy Partners, NextEra Energy and Duke Energy owning 50 percent, 42.5 percent and 7.5 percent respectively.
The NEXUS project, a joint venture with DTE Energy, will allow customers to move up to 1.5 billion cubic feet per day (Bcf/d) to Ohio and Michigan markets with access to the Dawn Hub, which is the second largest physically traded gas hub in North America and is owned and operated by Spectra Energy's subsidiary, Union Gas. NEXUS has a strong customer base and is moving forward with support from executed customer agreements with local distribution companies (LDCs), as well as Marcellus and Utica producers.
NEXUS has also signed 13 interconnect agreements with industrial facilities and power generators that could connect incremental load across Northern Ohio of up to 1.75 Bcf/d, which demonstrates strong long-term market support for our route and the project. NEXUS has consistently met its milestones and is on target for a November 2017 in-service date.
The AIM project is now in its second year of construction and more than 60 percent complete. AIM is supported by New England LDCs and is scheduled to meet its planned in-service date in fourth quarter 2016.
Advancements continue in our other projects in execution. Projects on track for in-service dates in 2016 include Loudon Expansion, which received its FERC certificate and commenced construction in March, Ozark, Salem Lateral and the first phase of Gulf Markets. Projects scheduled to go into service in 2017 include Atlantic Bridge, Access South, Adair Southwest, Lebanon Extension, TEAL and the second phase of Gulf Markets.
The PennEast project continues to move forward, and received its notice of schedule from FERC in March. The project has an expected in-service date in the second half of 2018.
Access Northeast, a project under development with Eversource Energy and National Grid, is focused on the New England electric power market and saving consumers money while improving the reliability of the region's energy system. In normal weather conditions, the project could save electric consumers an average of $1 billion a year. Savings during the extreme 2013-2014 winter could have been $2.5 billion with Access Northeast in service.
This solution is designed to meet the needs of New England by maximizing use of existing utility corridors and the Algonquin and Maritimes & Northeast pipelines, which directly connect to more than 60 percent of the existing ISO-New England gas-fired electric generation capacity and more than 80 percent of the new capacity that has recently cleared the ISO-New England forward capacity market. Access Northeast will cost-effectively deliver affordable natural gas when power generators need it, with new tariff services to handle peak hours, seasonal needs and quick starts to support intermittent wind and solar energy.
Access Northeast has executed contracts with electric distribution companies in New Hampshire and Massachusetts totaling more than 50 percent of the 0.9 Bcf/d project design capacity, and processes are under way at state public utility commissions, which are required to approve those contracts. The project anticipates additional contracts as regulatory processes progress in Connecticut, Rhode Island and Maine.
In April, FERC issued the Notice of Intent to prepare an Environmental Impact Statement for the Access Northeast project, which initiates the formal scoping process FERC utilizes to gather input from the public and interested agencies on the project. The project continues to advance toward a late 2018 initial in-service date, and Spectra Energy Partners expects to move Access Northeast into execution later this year.
In the liquids business, the Express Enhancement project is supported by long-term contracts and is on schedule for completion by the end of 2016.
Additional Information
Additional information about first quarter 2016 earnings can be obtained via the Spectra Energy website: www.spectraenergy.com.
The analyst call, held jointly with Spectra Energy, is scheduled for today, Wednesday, May 4, 2016, at 8 a.m. CT. The webcast will be available via the Spectra Energy and Spectra Energy Partners Investors pages. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 70917861 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Friday, June 3, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Spectra Energy and Spectra Energy Partners Investors pages.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests as a measure to evaluate operations of the partnership. This measure is a non-GAAP financial measure as it represents net income from controlling interests, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measure for ongoing net income from controlling interests is net income from controlling interests.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Partners, LP. Ongoing EBITDA represents EBITDA excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Partners, LP's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Partners, LP is net income.
The primary performance measure used by us to evaluate segment performance is segment EBITDA. We consider segment EBITDA, which is the GAAP measure used to report segment results, to be a good indicator of each segment's operating performance from its continuing operations as it represents the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA as a measure of performance. Ongoing segment EBITDA is a non-GAAP financial measure, as it represents reported segment EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's ongoing performance across periods. The most directly comparable GAAP measure for ongoing segment EBITDA is segment EBITDA.
We have also presented Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the partnership to support distribution growth. The most directly comparable GAAP measure for DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by distributions declared on partnership units. The most directly comparable GAAP measure for DCF coverage is Earnings-Per-Unit (EPU).
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other partnerships because other partnerships may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2014 Form 10-K, filed on February 27, 2015, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
Spectra Energy Partners, LP | ||||||||
Quarterly Highlights | ||||||||
March 2016 | ||||||||
(Unaudited) | ||||||||
(In millions, except per-unit amounts) | ||||||||
Reported - These results include the impact of special items | ||||||||
Three Months Ended | ||||||||
March 31, | ||||||||
2016 |
2015 | |||||||
INCOME |
||||||||
Operating Revenues |
$ |
624 |
$ |
606 |
||||
Total Reportable Segment EBITDA |
467 |
453 |
||||||
Net Income - Controlling Interests |
298 |
293 |
||||||
EBITDA BY BUSINESS SEGMENT |
||||||||
U.S. Transmission |
$ |
411 |
$ |
389 |
||||
Liquids |
56 |
64 |
||||||
Total Reportable Segment EBITDA |
467 |
453 |
||||||
Other EBITDA |
(20) |
(17) |
||||||
Total Reportable Segment and Other EBITDA |
$ |
447 |
$ |
436 |
||||
PARTNERS' CAPITAL |
||||||||
Declared Cash Distribution per Limited Partner Unit |
$ |
0.65125 |
$ |
0.60125 |
||||
Weighted Average Units Outstanding |
||||||||
Limited Partner Units |
285 |
295 |
||||||
General Partner Units |
6 |
6 |
||||||
DISTRIBUTABLE CASH FLOW |
||||||||
Distributable Cash Flow |
$ |
371 |
$ |
354 |
||||
CAPITAL AND INVESTMENT EXPENDITURES (a) |
||||||||
Capital expenditures - U.S. Transmission |
$ |
452 |
$ |
233 |
||||
Capital expenditures - Liquids |
16 |
7 |
||||||
Investment expenditures - Sand Hills/Southern Hills/SESH/Penn East/Nexus |
27 |
15 |
||||||
Total |
$ |
495 |
$ |
255 |
||||
U.S. TRANSMISSION |
||||||||
Operating Revenues |
$ |
538 |
$ |
522 |
||||
Operating Expenses |
||||||||
Operating, Maintenance and Other |
172 |
171 |
||||||
Other Income and Expenses |
45 |
38 |
||||||
EBITDA |
$ |
411 |
$ |
389 |
||||
LIQUIDS |
||||||||
Operating Revenues |
$ |
86 |
$ |
84 |
||||
Operating Expenses |
||||||||
Operating, Maintenance and Other |
31 |
34 |
||||||
Other Income and Expenses |
1 |
14 |
||||||
EBITDA |
$ |
56 |
$ |
64 |
||||
Express Pipeline Revenue Receipts, MBbl/d (b) |
233 |
246 |
||||||
Platte PADD II Deliveries, MBbl/d |
124 |
169 |
||||||
Canadian Dollar Exchange Rate, Average |
1.37 |
1.24 |
||||||
March 31, |
December 31, | |||||||
2016 |
2015 | |||||||
Debt |
$ |
6,951 |
$ |
6,604 |
||||
Actual Units Outstanding (c) |
293 |
291 |
||||||
(a) Excludes contributions received from noncontrolling interests of $95 million in 2016 and $58 million in 2015. | ||||||||
(b) Thousand barrels per day. | ||||||||
(c) Increase in 2016 resulted primarily from the "At the Market" equity issuance program |
Spectra Energy Partners, LP | |||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||
(Unaudited) | |||||||||||||||
(In millions) | |||||||||||||||
Reported - These results include the impact of special items | |||||||||||||||
Quarters Ended |
|||||||||||||||
2016 |
2015 |
||||||||||||||
Operating Revenues |
$ |
624 |
$ |
606 |
|||||||||||
Operating Expenses |
300 |
295 |
|||||||||||||
Operating Income |
324 |
311 |
|||||||||||||
Other Income and Expenses |
47 |
49 |
|||||||||||||
Interest Expense |
56 |
57 |
|||||||||||||
Earnings Before Income Taxes |
315 |
303 |
|||||||||||||
Income Tax Expense |
4 |
2 |
|||||||||||||
Net Income |
311 |
301 |
|||||||||||||
Net Income - Noncontrolling Interests |
13 |
8 |
|||||||||||||
Net Income - Controlling Interests |
$ |
298 |
$ |
293 |
Spectra Energy Partners, LP | |||||||||||
Condensed Consolidated Balance Sheets | |||||||||||
(Unaudited) | |||||||||||
(In millions) | |||||||||||
March 31, |
December 31, | ||||||||||
2016 |
2015 | ||||||||||
ASSETS |
|||||||||||
Current Assets |
$ |
585 |
$ |
544 |
|||||||
Investments and Other Assets |
4,231 |
4,180 |
|||||||||
Net Property, Plant and Equipment |
14,257 |
13,837 |
|||||||||
Regulatory Assets and Deferred Debits |
309 |
290 |
|||||||||
Total Assets |
$ |
19,382 |
$ |
18,851 |
|||||||
LIABILITIES AND EQUITY |
|||||||||||
Current Liabilities |
$ |
1,719 |
$ |
1,471 |
|||||||
Long-term Debt |
5,862 |
5,845 |
|||||||||
Deferred Credits and Other Liabilities |
194 |
189 |
|||||||||
Equity |
11,607 |
11,346 |
|||||||||
Total Liabilities and Equity |
$ |
19,382 |
$ |
18,851 |
Spectra Energy Partners, LP | |||||||||
Distributable Cash Flow | |||||||||
(Unaudited) | |||||||||
(Dollars in Millions, except where noted) | |||||||||
Three Months | |||||||||
2016 |
2015 | ||||||||
Net Income |
$ |
311 |
$ |
301 |
|||||
Add: |
|||||||||
Interest expense |
56 |
57 |
|||||||
Income tax expense |
4 |
2 |
|||||||
Depreciation and amortization |
77 |
73 |
|||||||
Foreign currency (gain) loss |
(1) |
3 |
|||||||
EBITDA |
447 |
436 |
|||||||
Add: |
|||||||||
Earnings from equity investments |
(27) |
(40) |
|||||||
Distributions from equity investments (a) |
65 |
54 |
|||||||
Non-cash impairment at Ozark Gas Gathering |
— |
9 |
|||||||
Other |
2 |
3 |
|||||||
Less: |
|||||||||
Interest expense |
56 |
57 |
|||||||
Equity AFUDC |
17 |
11 |
|||||||
Net cash paid for income taxes |
1 |
5 |
|||||||
Distributions to non-controlling interests |
7 |
7 |
|||||||
Maintenance capital expenditures |
35 |
28 |
|||||||
Total Distributable Cash Flow |
$ |
371 |
$ |
354 |
|||||
(a) Excludes $2 million of distributions from equity investments for the three month period ended March 31, 2015. |
Spectra Energy Partners, LP |
|||||||
Reported to Ongoing Earnings Reconciliation |
|||||||
March 2016 Year-to-date |
|||||||
(Unaudited) |
|||||||
(In millions) |
|||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported/ Ongoing |
||||||
U.S. Transmission |
$ |
411 |
|||||
Liquids |
56 |
||||||
Total Reportable Segment EBITDA |
467 |
||||||
Other |
(20) |
||||||
Total Reportable Segment and other EBITDA |
$ |
447 |
|||||
EARNINGS |
|||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
447 |
|||||
Depreciation and Amortization |
(77) |
||||||
Interest Expense |
(56) |
||||||
Other Income and Expenses |
1 |
||||||
Income Tax Expense |
(4) |
||||||
Total Net Income |
311 |
||||||
Total Net Income - Noncontrolling Interests |
(13) |
||||||
Total Net Income - Controlling Interests |
$ |
298 |
|||||
Spectra Energy Partners, LP |
|||||||||||||||
Reported to Ongoing Earnings Reconciliation |
|||||||||||||||
March 2015 Year-to-date |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In millions) |
|||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported Earnings |
Less: Special |
Ongoing Earnings |
||||||||||||
U.S. Transmission |
$ |
389 |
$ |
(9) |
A |
$ |
398 |
||||||||
Liquids |
64 |
— |
64 |
||||||||||||
Total Reportable Segment EBITDA |
453 |
(9) |
462 |
||||||||||||
Other |
(17) |
— |
(17) |
||||||||||||
Total Reportable Segment and other EBITDA |
$ |
436 |
$ |
(9) |
$ |
445 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
436 |
$ |
(9) |
$ |
445 |
|||||||||
Depreciation and Amortization |
(73) |
— |
(73) |
||||||||||||
Interest Expense |
(57) |
— |
(57) |
||||||||||||
Other Income and Expenses |
(3) |
— |
(3) |
||||||||||||
Income Tax Expense |
(2) |
— |
(2) |
||||||||||||
Total Net Income |
301 |
(9) |
310 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(8) |
— |
(8) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
293 |
$ |
(9) |
$ |
302 |
|||||||||
A - Non-cash impairment at Ozark Gas Gathering. |
|||||||||||||||
Spectra Energy Partners, LP Reported to Ongoing Distributable Cash Flow Reconciliation Unaudited (In millions) Three Months Ended March 31, 2016 March 31, 2015 Reported/ Reported Less: Ongoing Net Income $ 311 $ 301 $ (9) $ 310 Add: Interest expense 56 57 - 57 Income tax expense 4 2 - 2 Depreciation and amortization 77 73 - 73 Foreign currency loss (1) 3 - 3 EBITDA 447 436 (9) 445 Add: Earnings from equity investments (27) (40) - (40) Distributions from equity investments 65 54 - 54 Non-cash impairment at Ozark Gas Gathering - 9 9 - Other 2 3 - 3 Less: Interest expense 56 57 - 57 Equity AFUDC 17 11 - 11 Net cash paid for income taxes 1 5 - 5 Distributions to non-controlling interests 7 7 - 7 Maintenance capital expenditures 35 28 - 28 Total Distributable Cash Flow $ 371 $ 354 $ - $ 354
Ongoing
Special Items
Logo - http://photos.prnewswire.com/prnh/20071107/CLW064
SOURCE Spectra Energy Partners, LP
HOUSTON, May 4, 2016 /PRNewswire/ --
First Quarter Highlights:
Spectra Energy Corp (NYSE: SE) today reported first quarter 2016 financial results. For the quarter, ongoing earnings before interest, taxes, depreciation and amortization (EBITDA) were $757 million, compared with $788 million in the prior-year quarter.
Distributable cash flow (DCF) for the quarter was $523 million, compared with $578 million in the same quarter last year.
Ongoing net income from controlling interests was $238 million, or $0.35 diluted earnings per share (EPS), compared with $274 million, or $0.41 diluted EPS in first quarter 2015. Reported net income from controlling interests was $234 million, or $0.35 diluted EPS, compared with $267 million, or $0.40 diluted EPS in first quarter 2015.
CEO COMMENT
"Spectra Energy's solid first quarter results are very much in line with our full year expectations. Our businesses generated strong earnings and cash flow despite continued headwinds in the sector. These results, which illustrate our stable, reliable and disciplined business model, continue to give us confidence in our ability to deliver on the plan we outlined to investors in February," said Greg Ebel, chief executive officer, Spectra Energy.
"Spectra Energy benefits from the flexibility of multiple financing options across the corporation. This allows us to access capital markets at favorable rates and fund our $8 billion of secured expansion projects, as demonstrated by our recent successful equity raises. Those expansion projects are advancing as planned, and we continue to make great progress on projects under development. Most notably, we moved closer to placing Access Northeast – our solution to lower electricity costs and improve electric reliability in New England – into execution," continued Ebel.
SEGMENT RESULTS
Spectra Energy Partners
Ongoing EBITDA from Spectra Energy Partners was $473 million in first quarter 2016, compared with $464 million in first quarter 2015. The 2015 period excludes a non-cash special item expense of $9 million. These results reflect increased earnings from expansion projects in our natural gas transmission business, partially offset by lower interruptible and short-term contract transportation revenue due to warmer weather and the absence of equity earnings from Sand Hills and Southern Hills natural gas liquids (NGL) pipelines, which Spectra Energy Partners owned until October 2015. Earnings from these NGL pipeline interests are now reflected in the Field Services segment.
Distribution
Distribution reported first quarter 2016 EBITDA of $170 million, compared with $192 million in first quarter 2015. This decrease was mainly due to the effect of a lower Canadian dollar and warmer weather, partially offset by incremental earnings from the 2015 Dawn-Parkway expansion project.
Western Canada Transmission & Processing
Western Canada Transmission & Processing reported first quarter 2016 EBITDA of $123 million, compared with $161 million in first quarter 2015. The segment's results reflect the effect of a lower Canadian dollar and lower earnings at Empress, largely due to changes in non-cash mark-to-market commodity-related pricing adjustments associated with the risk management program.
Field Services
Ongoing EBITDA from Field Services was $10 million in first quarter 2016, compared with $(14) million in first quarter 2015. The ongoing results exclude non-cash special item expenses of $7 million in 2016 and a special item expense of $3 million in 2015. Results for the quarter reflect higher earnings attributable to expansions and favorable contract realignment efforts, including a settlement with a producer that DCP announced earlier in the year. These increases were partially offset by lower commodity prices and volume declines in certain geographic regions.
During the first quarters of 2016 and 2015, respectively, NGL prices averaged $0.37 per gallon versus $0.49 per gallon, NYMEX natural gas averaged $2.09 per million British thermal units (MMBtu) versus $2.98 per MMBtu, and crude oil averaged approximately $33 per barrel versus $49 per barrel.
Other
"Other" reported net expenses of $19 million in first quarter 2016, compared with $15 million in first quarter 2015, reflecting higher corporate costs, including employee benefits costs. "Other" primarily consists of corporate expenses, including benefits and captive insurance.
Income Tax Expense
Income tax expense was $98 million in first quarter 2016, compared with $101 million in first quarter 2015, reflecting lower earnings. The effective tax rate was 24 percent in the first quarter of both 2016 and 2015.
Interest Expense
Interest expense was $151 million in first quarter 2016, compared with $159 million in first quarter 2015, reflecting higher capitalized interest and a lower Canadian dollar, partially offset by higher average long-term debt balances.
Foreign Currency
Net income from controlling interests for the quarter was lower by $14 million due to a lower Canadian dollar.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy as of March 31, 2016, was $15.0 billion, with available liquidity of $2.7 billion. Including contributions from noncontrolling interests, Spectra Energy has $3.0 billion of capital expansion spending planned in 2016, $1.8 billion of which will be at Spectra Energy Partners.
Through its newly initiated "At the Market" (ATM) equity issuance program, Spectra Energy has received net proceeds of $383 million this year.
In April 2016, Spectra Energy issued 16.1 million common shares to the public for total net proceeds of $479 million. The proceeds were used to purchase 10.4 million common units from Spectra Energy Partners.
Including contributions from noncontrolling interests of $95 million, total capital spending in first quarter 2016 was $596 million, composed of $508 million of growth capital expenditures and $88 million of maintenance capital expenditures.
EXPANSION PROJECT UPDATES
Spectra Energy continues to make progress on securing $35 billion in new projects by the end of the decade. At the end of first quarter 2016, the company had:
$10.2 billion – in service and delivering solid cash flows
$8.3 billion – in execution, including ~ $2 billion scheduled for 2016 in-service
$20+ billion – in development
Spectra Energy Partners
Spectra Energy Partners has advanced numerous projects across the system. Sabal Trail, a joint venture with NextEra Energy and Duke Energy, received its Certificate of Public Convenience and Necessity from the Federal Energy Regulatory Commission (FERC) in February. This approval authorizes Sabal Trail, subject to certain conditions, to proceed with construction in order to meet a May 2017 in-service date. On April 1, 2016, Sabal Trail ownership agreements were finalized with Spectra Energy Partners, NextEra Energy and Duke Energy owning 50 percent, 42.5 percent and 7.5 percent respectively.
The NEXUS project, a joint venture with DTE Energy, will allow customers to move up to 1.5 billion cubic feet per day (Bcf/d) to Ohio and Michigan markets with access to the Dawn Hub, which is the second largest physically traded gas hub in North America and is owned and operated by Union Gas. NEXUS has a strong customer base and is moving forward with support from executed customer agreements with local distribution companies (LDCs), as well as Marcellus and Utica producers.
NEXUS has also signed 13 interconnect agreements with industrial facilities and power generators that could connect incremental load across Northern Ohio of up to 1.75 Bcf/d, which demonstrates strong long-term market support for our route and the project. NEXUS has consistently met its milestones and is on target for a November 2017 in-service date.
The AIM project is now in its second year of construction and more than 60 percent complete. AIM is supported by New England LDCs and is scheduled to meet its planned in-service date in fourth quarter 2016.
Advancements continue in our other projects in execution. Projects on track for in-service dates in 2016 include Loudon Expansion, which received its FERC certificate and commenced construction in March, Ozark, Salem Lateral and the first phase of Gulf Markets. Projects scheduled to go into service in 2017 include Atlantic Bridge, Access South, Adair Southwest, Lebanon Extension, TEAL and the second phase of Gulf Markets.
The PennEast project continues to move forward, and received its notice of schedule from FERC in March. The project has an expected in-service date in the second half of 2018.
Access Northeast, a project under development with Eversource Energy and National Grid, is focused on the New England electric power market and saving consumers money while improving the reliability of the region's energy system. In normal weather conditions, the project could save electric consumers an average of $1 billion a year. Savings during the extreme 2013-2014 winter could have been $2.5 billion with Access Northeast in service.
This solution is designed to meet the needs of New England by maximizing use of existing utility corridors and the Algonquin and Maritimes & Northeast pipelines, which directly connect to more than 60 percent of the existing ISO-New England gas-fired electric generation capacity and more than 80 percent of the new capacity that has recently cleared the ISO-New England forward capacity market. Access Northeast will cost-effectively deliver affordable natural gas when power generators need it, with new tariff services to handle peak hours, seasonal needs, and quick starts to support intermittent wind and solar energy.
Access Northeast has executed contracts with electric distribution companies in New Hampshire and Massachusetts totaling more than 50 percent of the 0.9 Bcf/d project design capacity, and processes are under way at state public utility commissions, which are required to approve those contracts. The project anticipates additional contracts as regulatory processes progress in Connecticut, Rhode Island and Maine.
In April, FERC issued the Notice of Intent to prepare an Environmental Impact Statement for the Access Northeast project, which initiates the formal scoping process FERC utilizes to gather input from the public and interested agencies on the project. The project continues to advance toward a late 2018 initial in-service date, and Spectra Energy Partners expects to move Access Northeast into execution later this year.
In the liquids business, the Express Enhancement project is supported by long-term contracts and is on schedule for completion by the end of 2016.
Distribution
Union Gas' Dawn storage hub and mainline transmission system continues to expand and is increasingly important in supplying gas to eastern Canada and the U.S. Northeast.
The 2016 and 2017 Dawn Parkway expansions are in construction and are on schedule for their respective in-service dates. Construction has also commenced on the Burlington-Oakville expansion, which is expected to be in service later this year.
Western Canada Transmission & Processing
Two expansion projects on the company's BC Pipeline in Western Canada are underpinned by long-term contracts with Montney producers. The High Pine project will add capacity through pipeline looping and compression, delivering an additional 240 million cubic feet per day (MMcf/d) of capacity growth, with an expected in-service date of late 2016. The project application was filed for approval with Canada's National Energy Board (NEB) in fourth quarter 2015. Wyndwood will add 50 MMcf/d of capacity through the addition of pipeline looping and compressor station modifications, with an expected in-service date of 2018.
The Jackfish Lake project is proceeding on schedule to be in service in 2017; the project application was filed with the NEB in fourth quarter 2015.
The RAM project will increase reliability and maintainability on our fully contracted 1.5 Bcf/d T-South system, is proceeding on schedule, and will phase in from 2016 through 2018. Upon completion, RAM will allow significantly higher summer load factors than previous years to meet increased demands for low-cost British Columbia production in the Pacific Northwest.
Additional Information
Additional information about first quarter 2016 earnings can be obtained via the Spectra Energy website: www.spectraenergy.com.
The analyst call, held jointly with Spectra Energy Partners, is scheduled for today, Wednesday, May 4, 2016, at 8 a.m. CT. The webcast will be available via the Spectra Energy and Spectra Energy Partners Investors pages. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 70917861 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Friday, June 3, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Spectra Energy and Spectra Energy Partners Investors pages.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests and ongoing diluted EPS as measures to evaluate operations of the company. These measures are non-GAAP financial measures as they represent net income from controlling interests and diluted EPS, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests and ongoing diluted EPS provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measures for ongoing net income from controlling interests and ongoing diluted EPS are net income from controlling interests and diluted EPS.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Corp. Ongoing EBITDA represents EBITDA excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Corp's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Corp is net income.
The primary performance measure used by us to evaluate segment performance is segment EBITDA. We consider segment EBITDA, which is the GAAP measure used to report segment results, to be a good indicator of each segment's operating performance from its continuing operations as it represents the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA and ongoing Other EBITDA (net expenses) as measures of performance. Ongoing segment EBITDA and ongoing Other EBITDA are non-GAAP financial measures, as they represent segment EBITDA and Other EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA and ongoing Other EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's or Other's ongoing performance across periods. The most directly comparable GAAP measures for ongoing segment EBITDA and ongoing Other EBITDA are segment EBITDA and Other EBITDA.
We have also presented Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the company to support dividend growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by dividends declared on common stock. The most directly comparable GAAP measure for DCF coverage is EPS.
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other companies because other companies may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2014 Form 10-K, filed on February 27, 2015, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com and www.spectraenergypartners.com.
Spectra Energy Corp | ||||||||
Quarterly Highlights | ||||||||
March 2016 | ||||||||
(Unaudited) | ||||||||
(In millions, except per-share amounts and where noted) | ||||||||
Reported - These results include the impact of special items | ||||||||
Three Months | ||||||||
2016 |
2015 | |||||||
COMMON STOCK DATA |
||||||||
Earnings Per Share, Diluted |
$ |
0.35 |
$ |
0.40 |
||||
Dividends Per Share |
$ |
0.405 |
$ |
0.370 |
||||
Weighted-Average Shares Outstanding, Diluted |
675 |
673 |
||||||
INCOME |
||||||||
Operating Revenues |
$ |
1,384 |
$ |
1,623 |
||||
Total Reportable Segment EBITDA |
769 |
791 |
||||||
Net Income - Controlling Interests |
234 |
267 |
||||||
EBITDA BY BUSINESS SEGMENT |
||||||||
Spectra Energy Partners |
$ |
473 |
$ |
455 |
||||
Distribution |
170 |
192 |
||||||
Western Canada Transmission & Processing |
123 |
161 |
||||||
Field Services |
3 |
(17) |
||||||
Total Reportable Segment EBITDA |
769 |
791 |
||||||
Other EBITDA |
(19) |
(15) |
||||||
Total Reportable Segment and Other EBITDA |
$ |
750 |
$ |
776 |
||||
DISTRIBUTABLE CASH FLOW |
||||||||
Distributable Cash Flow |
$ |
523 |
$ |
578 |
||||
CAPITAL AND INVESTMENT EXPENDITURES |
||||||||
Spectra Energy Partners (a) |
$ |
495 |
$ |
255 |
||||
Distribution |
125 |
89 |
||||||
Western Canada Transmission & Processing |
62 |
45 |
||||||
Other |
9 |
14 |
||||||
Total Capital and Investment Expenditures (a) |
$ |
691 |
$ |
403 |
||||
Expansion and Investment (a) |
$ |
603 |
$ |
316 |
||||
Maintenance and Other |
88 |
87 |
||||||
Total Capital and Investment Expenditures (a) |
$ |
691 |
$ |
403 |
||||
March 31, |
December 31, | |||||||
2016 |
2015 | |||||||
CAPITALIZATION |
||||||||
Common Equity - Controlling Interests |
27.9 |
% |
26.6 |
% | ||||
Noncontrolling Interests and Preferred Stock |
13.7 |
% |
13.6 |
% | ||||
Total Debt |
58.4 |
% |
59.8 |
% | ||||
Total Debt |
$ |
14,993 |
$ |
14,656 |
||||
Book Value Per Share (b) |
$ |
10.47 |
$ |
9.73 |
||||
Actual Shares Outstanding (c) |
684 |
671 |
||||||
(a) Excludes contributions received from noncontrolling interests of $95 million in 2016 and $58 million in 2015. | ||||||||
(b) Represents controlling interests. |
||||||||
(c) Increase in 2016 resulted primarily from a newly initiated "At the Market" equity issuance program |
Spectra Energy Corp | ||||||||
Quarterly Highlights | ||||||||
March 2016 | ||||||||
(Unaudited) | ||||||||
(In millions, except where noted) | ||||||||
Reported - These results include the impact of special items | ||||||||
Three Months | ||||||||
2016 |
2015 | |||||||
SPECTRA ENERGY PARTNERS |
||||||||
Operating Revenues |
$ |
624 |
$ |
606 |
||||
Operating Expenses |
||||||||
Operating, Maintenance and Other |
205 |
207 |
||||||
Other Income and Expenses |
54 |
56 |
||||||
EBITDA |
$ |
473 |
$ |
455 |
||||
Express Pipeline Revenue Receipts, MBbl/d (a) |
233 |
246 |
||||||
Platte PADD II Deliveries, MBbl/d |
124 |
169 |
||||||
DISTRIBUTION |
||||||||
Operating Revenues |
$ |
465 |
$ |
662 |
||||
Operating Expenses |
||||||||
Natural Gas Purchased |
215 |
383 |
||||||
Operating, Maintenance and Other |
82 |
86 |
||||||
Other Income and Expenses |
2 |
(1) |
||||||
EBITDA |
$ |
170 |
$ |
192 |
||||
Number of Customers, Thousands |
1,441 |
1,422 |
||||||
Heating Degree Days, Fahrenheit |
3,315 |
4,259 |
||||||
Pipeline Throughput, TBtu (b) |
230 |
328 |
||||||
Canadian Dollar Exchange Rate, Average |
1.37 |
1.24 |
||||||
WESTERN CANADA TRANSMISSION & PROCESSING |
||||||||
Operating Revenues |
$ |
305 |
$ |
370 |
||||
Operating Expenses |
||||||||
Natural Gas and Petroleum Products Purchased |
48 |
67 |
||||||
Operating, Maintenance and Other |
137 |
147 |
||||||
Other Income and Expenses |
3 |
5 |
||||||
EBITDA |
$ |
123 |
$ |
161 |
||||
Pipeline Throughput, TBtu |
252 |
256 |
||||||
Volumes Processed, TBtu |
176 |
180 |
||||||
Canadian Dollar Exchange Rate, Average |
1.37 |
1.24 |
||||||
FIELD SERVICES |
||||||||
Earnings (loss) from Equity Investment in DCP Midstream, LLC |
$ |
3 |
$ |
(17) |
||||
Natural Gas Gathered and Processed/Transported, TBtu/day (c) |
6.9 |
7.1 |
||||||
Natural Gas Liquids Production, MBbl/d (c) |
382 |
399 |
||||||
Average Natural Gas Price Per MMBtu (d) |
$ |
2.09 |
$ |
2.98 |
||||
Average Natural Gas Liquids Price Per Gallon (e) |
$ |
0.37 |
$ |
0.49 |
||||
Average Crude Oil Price Per Barrel (f) |
$ |
33.45 |
$ |
48.63 |
||||
(a) Thousand barrels per day. |
||||||||
(b) Trillion British thermal units. |
||||||||
(c) Reflects 100% of DCP Midstream volumes. |
||||||||
(d) Million British thermal units. Average price based on NYMEX Henry Hub. |
||||||||
(e) Does not reflect results of commodity hedges. |
||||||||
(f) Average price based on NYMEX calendar month. |
Spectra Energy Corp | |||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||
(Unaudited) | |||||||||||||||
(In millions) | |||||||||||||||
Reported - These results include the impact of special items | |||||||||||||||
Three Months | |||||||||||||||
2016 |
2015 | ||||||||||||||
Operating Revenues |
$ |
1,384 |
$ |
1,623 |
|||||||||||
Operating Expenses |
890 |
1,082 |
|||||||||||||
Operating Income |
494 |
541 |
|||||||||||||
Other Income and Expenses |
65 |
44 |
|||||||||||||
Interest Expense |
151 |
159 |
|||||||||||||
Earnings Before Income Taxes |
408 |
426 |
|||||||||||||
Income Tax Expense |
98 |
101 |
|||||||||||||
Net Income |
310 |
325 |
|||||||||||||
Net Income - Noncontrolling Interests |
76 |
58 |
|||||||||||||
Net Income - Controlling Interests |
$ |
234 |
$ |
267 |
Spectra Energy Corp | |||||||||||
Condensed Consolidated Balance Sheets | |||||||||||
(Unaudited) | |||||||||||
(In millions) | |||||||||||
March 31, |
December 31, | ||||||||||
2016 |
2015 | ||||||||||
ASSETS |
|||||||||||
Current Assets |
$ |
1,475 |
$ |
1,648 |
|||||||
Investments and Other Assets |
7,182 |
7,056 |
|||||||||
Net Property, Plant and Equipment |
24,019 |
22,918 |
|||||||||
Regulatory Assets and Deferred Debits |
1,415 |
1,301 |
|||||||||
Total Assets |
$ |
34,091 |
$ |
32,923 |
|||||||
LIABILITIES AND EQUITY |
|||||||||||
Current Liabilities |
$ |
3,163 |
$ |
3,392 |
|||||||
Long-term Debt |
13,190 |
12,892 |
|||||||||
Deferred Credits and Other Liabilities |
7,039 |
6,768 |
|||||||||
Preferred Stock of Subsidiaries |
339 |
339 |
|||||||||
Equity |
10,360 |
9,532 |
|||||||||
Total Liabilities and Equity |
$ |
34,091 |
$ |
32,923 |
Spectra Energy Corp | |||||||||
Distributable Cash Flow | |||||||||
(Unaudited) | |||||||||
(In millions) | |||||||||
Three Months | |||||||||
2016 |
2015 | ||||||||
Net Income |
$ |
310 |
$ |
325 |
|||||
Add: |
|||||||||
Interest expense |
151 |
159 |
|||||||
Income tax expense |
98 |
101 |
|||||||
Depreciation and amortization |
193 |
193 |
|||||||
Foreign currency (gain) loss |
(2) |
(1) |
|||||||
Less: |
|||||||||
Third party interest income |
— |
1 |
|||||||
EBITDA |
750 |
776 |
|||||||
Add: |
|||||||||
(Earnings) Loss from equity investments |
(33) |
(24) |
|||||||
Distributions from equity investments (a) |
65 |
54 |
|||||||
Empress non-cash items |
32 |
22 |
|||||||
Non-cash impairment at Ozark Gas Gathering |
— |
9 |
|||||||
Other |
5 |
5 |
|||||||
Less: |
|||||||||
Interest expense |
151 |
159 |
|||||||
Equity AFUDC |
25 |
16 |
|||||||
Net cash paid (refund) for income taxes |
(22) |
(46) |
|||||||
Distributions to non-controlling interests |
54 |
44 |
|||||||
Maintenance capital expenditures |
88 |
91 |
|||||||
Total Distributable Cash Flow |
$ |
523 |
$ |
578 |
|||||
(a) 2015 period excludes $2 million in distributions from equity investments. | |||||||||
Spectra Energy Corp | ||||||||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||||||||
March 2016 Year-to-date | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except per-share amounts) | ||||||||||||||||
Reported Earnings |
Less: Special Items |
Ongoing Earnings | ||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
||||||||||||||||
Spectra Energy Partners |
$ |
473 |
$ |
— |
$ |
473 |
||||||||||
Distribution |
170 |
— |
170 |
|||||||||||||
Western Canada Transmission & Processing |
123 |
— |
123 |
|||||||||||||
Field Services |
3 |
(7) |
A |
10 |
||||||||||||
Total Reportable Segment EBITDA |
769 |
(7) |
776 |
|||||||||||||
Other |
(19) |
— |
(19) |
|||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
750 |
$ |
(7) |
$ |
757 |
||||||||||
EARNINGS |
||||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
750 |
$ |
(7) |
$ |
757 |
||||||||||
Depreciation and Amortization |
(193) |
— |
(193) |
|||||||||||||
Interest Expense |
(151) |
— |
(151) |
|||||||||||||
Interest Income and Other |
2 |
— |
2 |
|||||||||||||
Income Tax Expense |
(98) |
3 |
(101) |
|||||||||||||
Total Net Income |
310 |
(4) |
314 |
|||||||||||||
Total Net Income - Noncontrolling Interests |
(76) |
— |
(76) |
|||||||||||||
Total Net Income - Controlling Interests |
$ |
234 |
$ |
(4) |
$ |
238 |
||||||||||
EARNINGS PER SHARE, BASIC |
$ |
0.35 |
$ |
— |
$ |
0.35 |
||||||||||
EARNINGS PER SHARE, DILUTED |
$ |
0.35 |
$ |
— |
$ |
0.35 |
||||||||||
A - Non-cash asset impairments and write-offs. | ||||||||||||||||
Weighted Average Shares (reported and ongoing) - in millions |
||||||||||||||||
Basic |
674 |
|||||||||||||||
Diluted |
675 |
Spectra Energy Corp | |||||||||||||||
Reported to Ongoing Earnings Reconciliation | |||||||||||||||
March 2015 Year-to-date | |||||||||||||||
(Unaudited) | |||||||||||||||
(In millions, except per-share amounts) | |||||||||||||||
Reported Earnings |
Less: |
Ongoing Earnings | |||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
|||||||||||||||
Spectra Energy Partners |
$ |
455 |
$ |
(9) |
A |
$ |
464 |
||||||||
Distribution |
192 |
— |
192 |
||||||||||||
Western Canada Transmission & Processing |
161 |
— |
161 |
||||||||||||
Field Services |
(17) |
(3) |
B |
(14) |
|||||||||||
Total Reportable Segment EBITDA |
791 |
(12) |
803 |
||||||||||||
Other |
(15) |
— |
(15) |
||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
776 |
$ |
(12) |
$ |
788 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
776 |
$ |
(12) |
$ |
788 |
|||||||||
Depreciation and Amortization |
(193) |
— |
(193) |
||||||||||||
Interest Expense |
(159) |
— |
(159) |
||||||||||||
Interest Income and Other |
2 |
— |
2 |
||||||||||||
Income Tax Expense |
(101) |
4 |
(105) |
||||||||||||
Total Net Income |
325 |
(8) |
333 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(58) |
1 |
(59) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
267 |
$ |
(7) |
$ |
274 |
|||||||||
EARNINGS PER SHARE, BASIC |
$ |
0.40 |
$ |
(0.01) |
$ |
0.41 |
|||||||||
EARNINGS PER SHARE, DILUTED |
$ |
0.40 |
$ |
(0.01) |
$ |
0.41 |
|||||||||
A - Non-cash impairment at Ozark Gas Gathering. | |||||||||||||||
B - Overhead reduction costs. | |||||||||||||||
Weighted Average Shares (reported and ongoing) - in millions |
|||||||||||||||
Basic |
671 |
||||||||||||||
Diluted |
673 |
Spectra Energy Corp | ||||||||||||||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | ||||||||||||||||||||||||
Unaudited | ||||||||||||||||||||||||
(In millions, except where noted) | ||||||||||||||||||||||||
Three Months Ended |
Three Months Ended | |||||||||||||||||||||||
Reported |
Less: Special Items |
Ongoing |
Reported |
Less: Special Items |
Ongoing | |||||||||||||||||||
Net Income |
$ |
310 |
$ |
(4) |
$ |
314 |
$ |
325 |
$ |
(8) |
$ |
333 |
||||||||||||
Add: |
||||||||||||||||||||||||
Interest expense |
151 |
— |
151 |
159 |
— |
159 |
||||||||||||||||||
Income tax expense |
98 |
(3) |
101 |
101 |
(4) |
105 |
||||||||||||||||||
Depreciation and amortization |
193 |
— |
193 |
193 |
— |
193 |
||||||||||||||||||
Foreign currency (gain) loss |
(2) |
— |
(2) |
(1) |
— |
(1) |
||||||||||||||||||
Less: |
||||||||||||||||||||||||
Third party interest income |
— |
— |
— |
1 |
— |
1 |
||||||||||||||||||
EBITDA |
750 |
(7) |
757 |
776 |
(12) |
788 |
||||||||||||||||||
Add: |
||||||||||||||||||||||||
(Earnings) Loss from equity investments |
(33) |
7 |
(40) |
(24) |
3 |
(27) |
||||||||||||||||||
Distributions from equity investments |
65 |
— |
65 |
54 |
— |
54 |
||||||||||||||||||
Empress non-cash items |
32 |
— |
32 |
22 |
— |
22 |
||||||||||||||||||
Non-cash impairment at Ozark Gas Gathering |
— |
— |
— |
9 |
9 |
— |
||||||||||||||||||
Other |
5 |
— |
5 |
5 |
— |
5 |
||||||||||||||||||
Less: |
||||||||||||||||||||||||
Interest expense |
151 |
— |
151 |
159 |
— |
159 |
||||||||||||||||||
Equity AFUDC |
25 |
— |
25 |
16 |
— |
16 |
||||||||||||||||||
Net cash paid (refund) for income taxes |
(22) |
— |
(22) |
(46) |
— |
(46) |
||||||||||||||||||
Distributions to non-controlling interests |
54 |
— |
54 |
44 |
— |
44 |
||||||||||||||||||
Maintenance capital expenditures |
88 |
— |
88 |
91 |
— |
91 |
||||||||||||||||||
Total Distributable Cash Flow |
$ |
523 |
$ |
— |
$ |
523 |
$ |
578 |
$ |
— |
$ |
578 |
||||||||||||
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SOURCE Spectra Energy Corp
HOUSTON, May 4, 2016 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) announced that the board of directors of its general partner declared a quarterly cash distribution to unitholders of $0.65125 per unit, an increase of 1.25 cents over the previous level of $0.63875 per unit. This is the 34th consecutive quarter that Spectra Energy Partners has increased its quarterly cash distribution. The cash distribution is payable on May 27, 2016, to unitholders of record at the close of business on May 16, 2016. This quarterly cash distribution equates to $2.605 per unit on an annual basis.
This information is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Under rules applicable to publicly-traded partnerships, our distributions to non-U.S. unitholders are subject to withholding tax at the highest effective applicable rate to the extent attributable to income that is effectively connected with the conduct of a U.S. trade or business. Given the uncertainty at the time of making distributions regarding the amount of any distribution that is attributable to income that is so effectively connected, we intend to treat all of our distributions as attributable to our U.S. operations, and as a result, the entire distribution will be subject to withholding.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
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SOURCE Spectra Energy Partners, LP
HOUSTON, April 26, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) has declared a quarterly cash dividend on its common stock of $0.405 per share, or $1.62 per share on an annualized basis. The dividend is payable on June 7, 2016, to shareholders of record at the close of business on May 13, 2016.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com and www.spectraenergypartners.com.
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SOURCE Spectra Energy Corp
HOUSTON, April 6, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) and Spectra Energy Partners (NYSE: SEP) will announce their first quarter 2016 earnings results before the market opens on Wednesday, May 4, 2016, and will hold a joint investor and analyst conference call at 8 a.m. CT that same day.
The webcast will be available via the Spectra Energy and Spectra Energy Partners Investors pages. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 70917861 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Friday, June 3, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Spectra Energy and Spectra Energy Partners Investors pages.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com and www.spectraenergypartners.com.
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SOURCE Spectra Energy Corp and Spectra Energy Partners, LP
HOUSTON, April 4, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) and Spectra Energy Partners, LP (NYSE: SEP) announced today their agreement for Spectra Energy Corp to acquire approximately 9.1 million common units representing limited partner interests in Spectra Energy Partners at a price of $45.96 per unit in a private placement. In addition, Spectra Energy Corp will purchase up to an additional 1.4 million common units in the event that additional shares of its common stock are issued pursuant to the 25-day option granted to the underwriter in Spectra Energy Corp's public offering of common stock. Spectra Energy Corp is the parent company of the general partner of Spectra Energy Partners.
When the initial private placement is complete, Spectra Energy Partners will have approximately 296 million common units outstanding. The Spectra Energy Corp ownership interest in Spectra Energy Partners after this transaction will be 78 percent.
This transaction is being financed with the Spectra Energy common equity issuance announced earlier today.
"The transactions we announced today demonstrate the flexibility and economic benefits associated with having strong and multiple financing options across the Spectra Energy group of companies. The proceeds from these transactions, and the pending sale of our Empress asset, enable us to further execute on our 2016-2018 capital expansion plan. In addition, these transactions allow us to continue to deliver on our DCF, dividend and distribution expectations as well as our DCF coverage levels at Spectra Energy and Spectra Energy Partners as we outlined to investors earlier this year," said Greg Ebel, chairman and CEO of Spectra Energy and Spectra Energy Partners. "Given the results already achieved from our financing activities this year and our current capital plan, our expectation is that we will not need additional Spectra Energy equity in 2016. Spectra Energy Partners' ATM program is expected to continue to operate throughout 2016 and provide substantially all of SEP's remaining equity needs for this calendar year."
The securities to be issued in the private placement have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state laws.
This news release is neither an offer to sell nor a solicitation of an offer to buy any of these securities and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale is unlawful.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described in our filings that we make with the SEC, which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
About Spectra Energy and Spectra Energy Partners
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century.
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SOURCE Spectra Energy Partners, LP; Spectra Energy Corp
HOUSTON, April 4, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) today announced that its public offering of 14 million shares of its common stock was priced at $30 per share to the public. Barclays Capital Inc. is acting as the sole underwriter for the offering. The company expects the delivery of the shares to occur on April 8, 2016, subject to customary closing conditions. In addition, Barclays Capital Inc. has a 25-day option to purchase up to 2.1 million additional shares of the company's common stock.
Assuming no exercise of the option to purchase additional shares, Spectra Energy expects to receive gross proceeds from the offering of approximately $420 million (before the underwriting discount and other estimated offering expenses payable by the company). Spectra Energy expects to use the net proceeds from this offering to purchase additional common units from Spectra Energy Partners, LP (NYSE: SEP) in a private placement. Following that transaction, Spectra Energy, which is the parent company of the general partner of Spectra Energy Partners, will hold a 78 percent ownership interest in Spectra Energy Partners.
The offering is being made only by means of a prospectus and related prospectus supplement, copies of which may be obtained by contacting Barclays Capital Inc. by mail at c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, by e-mail at Barclaysprospectus@broadridge.com or by telephone at (888) 603-5847.
An electronic copy of the preliminary prospectus supplement and the accompanying prospectus are available from the Securities and Exchange Commission's web site at www.sec.gov.
The shares are being offered pursuant to an effective shelf registration statement that Spectra Energy previously filed with the Securities and Exchange Commission. This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdictions.
About Spectra Energy
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century.
Forward-Looking Statements
This 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. Forward-looking statements represent our intentions, plans, expectations, assumptions and beliefs about future events. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. Factors used to develop these forward-looking statements and that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, provincial, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop United States and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture.
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SOURCE Spectra Energy Corp
HOUSTON, April 4, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) today announced the commencement of an underwritten public offering of 14 million shares of its common stock. Barclays Capital Inc. is acting as the sole underwriter for the offering. In addition, Spectra Energy intends to grant Barclays Capital Inc. a 25-day option to purchase up to 2.1 million shares of its common stock.
Spectra Energy expects to use the net proceeds from this offering to purchase additional common units from Spectra Energy Partners, LP (NYSE: SEP) in a private placement.
The offering is being made only by means of a prospectus and related prospectus supplement, copies of which may be obtained by contacting Barclays Capital Inc. by mail at c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, by e-mail at Barclaysprospectus@broadridge.com or by telephone at (888) 603-5847.
An electronic copy of the preliminary prospectus supplement and the accompanying prospectus are available from the Securities and Exchange Commission's web site at www.sec.gov.
The shares are being offered pursuant to an effective shelf registration statement that Spectra Energy previously filed with the Securities and Exchange Commission. This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdictions.
About Spectra Energy
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century.
Forward-Looking Statements
This 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. Forward-looking statements represent our intentions, plans, expectations, assumptions and beliefs about future events. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. Factors used to develop these forward-looking statements and that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, provincial, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms;
the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop United States and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture.
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SOURCE Spectra Energy Corp
HOUSTON, Feb. 25, 2016 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) today announced it has filed the partnership's Annual Report on Form 10-K with the Securities and Exchange Commission (SEC), for the year that ended December 31, 2015.
The report is available for viewing and downloading through the partnership's website, www.spectraenergypartners.com, under SEC Filings on the Investors/News page. Investors may also request a hard copy of the 10-K, free of charge, by e-mailing
IR-SEP@spectraenergy.com.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
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SOURCE Spectra Energy Partners, LP
HOUSTON, Feb. 4, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) and Spectra Energy Partners (NYSE: SEP) today announced their 2016-2018 business and financial plan.
Key highlights for Spectra Energy include:
Key highlights for Spectra Energy Partners include:
"Our execution backlog of about $8 billion in secured projects is primarily driven by natural gas demand and will grow our cash flows during and beyond the plan period. The strength of our projects in execution gives us confidence in our ongoing ability to deliver an annual 14-cent per share dividend increase at Spectra Energy and our quarterly penny-and-a-quarter per unit distribution increase at Spectra Energy Partners through 2018," said Greg Ebel, chief executive officer, Spectra Energy. "Despite commodity prices and the Canadian dollar being significantly lower than a year ago, our 2016 and 2017 DCF forecasts and dividend and distribution coverage ratios are stronger than those we presented to investors a year ago.
"The fundamentals of a company matter – and in today's business environment, they matter even more. Our existing infrastructure assets go to where the lights are – from key supply basins to the fastest growing North American energy markets. The competitive advantage of our existing assets, with our expansion projects in execution, provides an outlook that is more robust than even a year ago and provides investors with stable and reliable returns," added Ebel.
Key assumptions underlying the three-year financial plan include:
Spectra Energy and Spectra Energy Partners will discuss their business outlook and three-year financial plan in greater detail during an analyst/investor meeting today.
The presentation is scheduled to begin at 8:30 a.m. ET and will be webcast via the Investors sections of the Spectra Energy and Spectra Energy Partners websites. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 7888893 or "Spectra Energy 2016 Plan."
A replay of the call will be available until 5 p.m. CT on Tuesday, May 3, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Investors sections of the Spectra Energy and Spectra Energy Partners websites.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: the success of a completed drop-down; state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described in our filings that we make with the SEC, which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
About Spectra Energy and Spectra Energy Partners
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com and www.spectraenergypartners.com.
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SOURCE Spectra Energy Corp; Spectra Energy Partners, LP
LAKE MARY, Fla., Feb. 3, 2016 /PRNewswire/ -- Sabal Trail Transmission, LLC, a joint venture of Spectra Energy Partners, LP (NYSE: SEP), NextEra Energy, Inc., and Duke Energy, received a certificate of public convenience and necessity from the Federal Energy Regulatory Commission (FERC) to construct and operate the Sabal Trail interstate natural gas pipeline project. This approval authorizes Sabal Trail, subject to certain conditions, to proceed with final preparations to commence construction in the coming months to meet a May 1, 2017, in-service date.
Once complete, the 516-mile pipeline would have the capacity to deliver approximately 1.1 billion cubic feet of natural gas per day to the Southeast U.S., including firm transportation services to Florida Power & Light Company and Duke Energy of Florida.
"Sabal Trail will provide a critically-needed source of domestic, clean-burning, affordable natural gas to the Southeast U.S. to meet the growing demand for natural gas-fired generation, the cleanest and most versatile fuel for powering the region's homes and businesses," said Bill Yardley, president of Sabal Trail Management, LLC and president of U.S. Transmission and Storage, Spectra Energy.
"For more than two and a half years, Sabal Trail has engaged with stakeholders, local community officials, and federal and state agencies to locate and design a pipeline system that will be built and operated safely and efficiently. Receiving this stamp of approval is a testament to our strong history of consultation and successful project execution. We are very pleased to reach this significant milestone and move one step closer to construction of the pipeline, which will diversify the region's energy sources and generate significant economic benefits for local communities."
For more information on Sabal Trail, visit www.sabaltrail.com.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
NextEra Energy, Inc. (NYSE:NEE) is a leading clean energy company with consolidated revenues of approximately $17.5 billion, approximately 46,300 megawatts of generating capacity, which includes megawatts associated with noncontrolling interests related to NextEra Energy Partners, LP (NYSE:NEP), and approximately 14,300 employees in 27 states and Canada as of year-end 2015. Headquartered in Juno Beach, Fla., NextEra Energy's principal subsidiaries are Florida Power & Light Company, which serves more than 4.8 million customer accounts in Florida and is one of the largest rate-regulated electric utilities in the United States, and NextEra Energy Resources, LLC, which, together with its affiliated entities, is the world's largest generator of renewable energy from the wind and sun. Through its subsidiaries, NextEra Energy generates clean, emissions-free electricity from eight commercial nuclear power units in Florida, New Hampshire, Iowa and Wisconsin. NextEra Energy has been recognized often by third parties for its efforts in sustainability, corporate responsibility, ethics and compliance, and diversity, and has been ranked in the top 10 worldwide for innovativeness and community responsibility as part of Fortune's 2015 list of "World's Most Admired Companies." For more information about NextEra Energy companies, visit these websites: www.NextEraEnergy.com, www.FPL.com, www.NextEraEnergyResources.com.
Duke Energy is the largest electric power holding company in the United States. Its regulated utility operations serve approximately 7.3 million electric customers located in six states in the Southeast and Midwest, representing a population of approximately 23 million people. Its Commercial Portfolio and International business segments own and operate diverse power generation assets in North America and Latin America, including a growing portfolio of renewable energy assets in the United States.
Headquartered in Charlotte, N.C., Duke Energy is a Fortune 250 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available at duke-energy.com.
Follow Duke Energy on Twitter, LinkedIn and Facebook.
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SOURCE Spectra Energy Partners, LP; Spectra Energy Corp
HOUSTON, Feb. 3, 2016 /PRNewswire/ --
2015 Year-End Highlights:
Spectra Energy Partners, LP (NYSE: SEP) today reported fourth quarter 2015 distributable cash flow (DCF) of $260 million, compared with $245 million in the prior-year quarter. For the year, DCF was $1.21 billion, up $150 million from $1.06 billion in 2014. Distributions per limited partner unit for 2015 were $2.43, compared with $2.245 per limited partner unit in 2014.
"Spectra Energy Partners once again delivered strong quarterly performance, capping off an outstanding year of higher cash flows and increased earnings. Our 2015 results reinforce the strength of our business – one which has no direct commodity exposure and little volume exposure," said Greg Ebel, chief executive officer, Spectra Energy Partners. "The strength of our fee-based model, high credit-quality customers, and the new projects we placed into service on time or early in 2015, continue to drive steady distribution growth, creating value for our investors now and into the future."
For the quarter, earnings before interest, taxes, depreciation and amortization (EBITDA) were $457 million, compared with $424 million in the prior-year quarter. For the year, reported EBITDA was $1.82 billion, up from $1.59 billion in 2014. Ongoing EBITDA for 2015 was $1.83 billion, compared with $1.59 billion in 2014.
In fourth quarter 2015, reported and ongoing net income from controlling interests were $304 million and $305 million, respectively, compared with $283 million in fourth quarter 2014. For the year, reported and ongoing net income from controlling interests were $1.23 billion and $1.24 billion, respectively, compared with $1.0 billion in 2014.
SEGMENT RESULTS
U. S. Transmission
U.S. Transmission reported fourth quarter 2015 EBITDA of $413 million, compared with $369 million in fourth quarter 2014. These results reflect increased earnings in our natural gas transmission business from expansion projects.
Year-end 2015 ongoing EBITDA for U.S. Transmission was $1.61 billion, compared with $1.42 billion in 2014. The 2015 period excludes a special item of $9 million related to a non-cash impairment of the Ozark Gas Gathering asset.
Liquids
Liquids reported fourth quarter 2015 EBITDA of $62 million, compared with $71 million in fourth quarter 2014. The decrease is attributable to lower equity earnings from Sand Hills and Southern Hills natural gas liquids (NGL) pipelines, which the company owned for approximately one month of the quarter.
Year-end 2015 EBITDA for Liquids was $283 million, compared with $240 million in 2014.
Other
"Other" reported net expenses of $18 million and $16 million in fourth quarters 2015 and 2014, respectively.
Year-end 2015 net expenses were $66 million, compared with $64 million in 2014.
ADDITIONAL FINANCIAL INFORMATION
Interest Expense
Interest expense was $60 million in fourth quarter 2015, compared with $55 million in fourth quarter 2014, driven by higher average long term debt balances, partially offset by higher capitalized interest.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy Partners as of December 31, 2015, was $6.6 billion. At the end of the quarter there was available liquidity of $1.7 billion. Spectra Energy Partners' capital expansion program continues to be funded through a combination of debt and equity. Total capital and investment spending for the quarter was $755 million, excluding contributions from noncontrolling interests. The spending consisted of $655 million of growth capital expenditures and $100 million of maintenance capital expenditures.
For the year, total capital and investment spending was approximately $2 billion, excluding contributions from noncontrolling interests, and consisted of about $1.7 billion of growth capital expenditures and about $310 million of maintenance capital expenditures.
In 2015, Spectra Energy Partners received net proceeds of approximately $550 million through its "At the Market" (ATM) equity issuance program, with nearly $200 million raised in the fourth quarter.
EXPANSION PROJECT UPDATES
Spectra Energy Partners has advanced numerous projects across the system. The company filed Federal Energy Regulatory Commission (FERC) certificate applications in the quarter for the Atlantic Bridge, Access South, Adair Southwest, and Lebanon Extension projects.
The NEXUS project, which is supported by local distribution companies (LDCs) as well as Marcellus and Utica producers, also filed its application with FERC, and reached another regulatory milestone in the quarter with the receipt of Ontario Energy Board (OEB) approval for the Canadian utility shippers. The joint venture with DTE will allow customers to move up to 1.5 billion cubic feet per day (Bcf/d) through Ohio and Michigan markets to the Dawn Hub, which is the second largest physically traded gas hub in North America and is owned and operated by Union Gas. NEXUS has secured additional connections with four natural gas distribution companies in Ohio, including the two largest in the state, two natural gas-fired power plants, and three industrial parks, demonstrating the value of the project path connecting to the largest natural gas supply source in North America. These connections could add incremental load across northern Ohio of up to 1.4 Bcf/d. NEXUS is on target for a November 2017 in-service date.
The AIM project, supported by New England LDCs, has made significant construction progress and is well on the way to its planned in-service date in the second half of 2016. A number of other projects are on track to meet their respective in-service dates, including the Sabal Trail, Ozark, Salem Lateral, Gulf Markets, Loudon Expansion, TEAL, and PennEast projects.
In the liquids business, the Express Enhancement project is supported by long-term contracts and is on schedule for completion by the end of 2016. The strong response to this system optimization project demonstrates that the Express pipeline's incumbent position is a substantial advantage in responding quickly to market demand.
Access Northeast is focused on the New England electric power market and saving consumers money while improving the reliability of the region's energy system. This solution maximizes existing infrastructure corridors, by utilizing the Algonquin and Maritimes & Northeast pipelines, which directly connect to more than 60 percent of the ISO-New England power plants. In addition, the four new natural gas-fired electric generation plants that have cleared the 2017 and 2018 ISO-NE forward capacity auctions will be located on the Algonquin pipeline, further demonstrating the company's very strong position in New England.
Access Northeast will carry natural gas from the least expensive supply areas, via multiple optional paths, directly to the majority of the power plants in New England. It will cost-effectively deliver supply when power generators need it, with new tariff services to handle the peak hour, quick start, and seasonal needs.
Access Northeast submitted its FERC pre-file application during the quarter and has recently executed electric distribution contracts in Massachusetts equaling more than 40 percent of the 0.9 Bcf/d capacity designed for generators. Progress is being made in other states, and Access Northeast anticipates state approvals for contracts later this year. The project continues to advance toward a late 2018 initial in-service date.
ADDITIONAL INFORMATION
Additional information about fourth quarter 2015 earnings can be obtained via the Spectra Energy Partners website: www.spectraenergypartners.com.
The analyst call, held jointly with Spectra Energy, is scheduled for today, Wednesday, February 3, 2016, at 8 a.m. CT. The webcast will be available via the Investors sections of the Spectra Energy and Spectra Energy Partners websites. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 89326071 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Tuesday, May 3, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Investors sections of the Spectra Energy and Spectra Energy Partners websites.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests as a measure to evaluate operations of the partnership. This measure is a non-GAAP financial measure as it represents net income from controlling interests, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measure for ongoing net income from controlling interests is reported net income from controlling interests.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Partners, LP. Ongoing EBITDA represents EBITDA excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Partners, LP's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Partners, LP is net income.
The primary performance measure used by us to evaluate segment performance is segment EBITDA. We consider segment EBITDA, which is the GAAP measure used to report segment results, to be a good indicator of each segment's operating performance from its continuing operations as it represents the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA as a measure of performance. Ongoing segment EBITDA is a non-GAAP financial measure, as it represents reported segment EBITDA excluding special items. We believe that the presentation of ongoing segment EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's ongoing performance across periods. The most directly comparable GAAP measure for ongoing segment EBITDA is reported segment EBITDA.
We have also presented Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the partnership to support distribution growth. The most directly comparable GAAP measure for DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by distributions declared on partnership units. The most directly comparable GAAP measure for DCF coverage is reported Earnings-Per-Unit (EPU).
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other partnerships because other partnerships may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2014 Form 10-K, filed on February 27, 2015, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
Spectra Energy Partners, LP | ||||||||||||||||
Quarterly Highlights | ||||||||||||||||
December 2015 | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except per-unit amounts) | ||||||||||||||||
These results include the impact of special items | ||||||||||||||||
Quarters Ended |
Years Ended | |||||||||||||||
December 31, |
December 31, | |||||||||||||||
2015 |
2014 |
2015 |
2014 | |||||||||||||
INCOME |
||||||||||||||||
Operating Revenues |
$ |
634 |
$ |
599 |
$ |
2,455 |
$ |
2,269 |
||||||||
Total Reportable Segment EBITDA |
475 |
440 |
1,882 |
1,655 |
||||||||||||
Net Income - Controlling Interests |
304 |
283 |
1,225 |
1,004 |
||||||||||||
EBITDA BY BUSINESS SEGMENT |
||||||||||||||||
U.S. Transmission |
$ |
413 |
$ |
369 |
$ |
1,599 |
$ |
1,415 |
||||||||
Liquids |
62 |
71 |
283 |
240 |
||||||||||||
Total Reportable Segment EBITDA |
475 |
440 |
1,882 |
1,655 |
||||||||||||
Other EBITDA |
(18) |
(16) |
(66) |
(64) |
||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
457 |
$ |
424 |
$ |
1,816 |
$ |
1,591 |
||||||||
PARTNERS' CAPITAL |
||||||||||||||||
Declared Cash Distribution per Limited Partner Unit |
$ |
0.63875 |
$ |
0.58875 |
$ |
2.4800 |
$ |
2.2875 |
||||||||
Weighted Average Units Outstanding |
||||||||||||||||
Limited Partner Units |
290 |
293 |
296 |
288 |
||||||||||||
General Partner Units |
6 |
6 |
6 |
6 |
||||||||||||
DISTRIBUTABLE CASH FLOW |
||||||||||||||||
Distributable Cash Flow |
$ |
260 |
$ |
245 |
$ |
1,205 |
$ |
1,055 |
||||||||
Coverage Ratio |
1.2X |
1.3X | ||||||||||||||
CAPITAL AND INVESTMENT EXPENDITURES (a) |
||||||||||||||||
Capital expenditures - U.S. Transmission |
$ |
1,857 |
$ |
1,063 |
||||||||||||
Capital expenditures - Liquids |
26 |
18 |
||||||||||||||
Investment expenditures - Sand Hills/Southern Hills/SESH/Penn East/Nexus |
124 |
160 |
||||||||||||||
Total |
$ |
2,007 |
$ |
1,241 |
||||||||||||
U.S. TRANSMISSION |
||||||||||||||||
Operating Revenues |
$ |
541 |
$ |
508 |
$ |
2,087 |
$ |
1,939 |
||||||||
Operating Expenses |
||||||||||||||||
Operating, Maintenance and Other |
184 |
177 |
680 |
647 |
||||||||||||
Other Income and Expenses |
56 |
38 |
192 |
123 |
||||||||||||
EBITDA |
$ |
413 |
$ |
369 |
$ |
1,599 |
$ |
1,415 |
||||||||
LIQUIDS |
||||||||||||||||
Operating Revenues |
$ |
93 |
$ |
91 |
$ |
368 |
$ |
330 |
||||||||
Operating Expenses |
||||||||||||||||
Operating, Maintenance and Other |
36 |
35 |
141 |
134 |
||||||||||||
Other Income and Expenses |
5 |
15 |
56 |
44 |
||||||||||||
EBITDA |
$ |
62 |
$ |
71 |
$ |
283 |
$ |
240 |
||||||||
Express Pipeline Revenue Receipts, MBbl/d (b) |
239 |
240 |
239 |
223 |
||||||||||||
Platte PADD II Deliveries, MBbl/d |
140 |
168 |
162 |
170 |
||||||||||||
Canadian Dollar Exchange Rate, Average |
1.34 |
1.14 |
1.28 |
1.10 |
||||||||||||
December 31, |
December 31, | |||||||||||||||
2015 |
2014 | |||||||||||||||
Debt |
$ |
6,604 |
$ |
6,077 |
||||||||||||
Actual Units Outstanding |
291 |
301 |
||||||||||||||
(a) Excludes contributions received from noncontrolling interests of $216 million in 2015 and $53 million in 2014. 2014 period includes an investment in SESH of $94 million, used by SESH to retire debt. | ||||||||||||||||
(b) Thousand barrels per day. |
Spectra Energy Partners, LP | ||||||||||||||||||
Condensed Consolidated Statements of Operations | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
(In millions) | ||||||||||||||||||
These results include the impact of special items | ||||||||||||||||||
Quarters Ended |
Years Ended | |||||||||||||||||
2015 |
2014 |
2015 |
2014 | |||||||||||||||
Operating Revenues |
$ |
634 |
$ |
599 |
$ |
2,455 |
$ |
2,269 |
||||||||||
Operating Expenses |
313 |
300 |
1,182 |
1,133 |
||||||||||||||
Operating Income |
321 |
299 |
1,273 |
1,136 |
||||||||||||||
Other Income and Expenses |
60 |
52 |
243 |
164 |
||||||||||||||
Interest Expense |
60 |
55 |
239 |
238 |
||||||||||||||
Earnings Before Income Taxes |
321 |
296 |
1,277 |
1,062 |
||||||||||||||
Income Tax Expense |
4 |
6 |
12 |
35 |
||||||||||||||
Net Income |
317 |
290 |
1,265 |
1,027 |
||||||||||||||
Net Income - Noncontrolling Interests |
13 |
7 |
40 |
23 |
||||||||||||||
Net Income - Controlling Interests |
$ |
304 |
$ |
283 |
$ |
1,225 |
$ |
1,004 |
Spectra Energy Partners, LP | |||||||||||
Condensed Consolidated Balance Sheets | |||||||||||
(Unaudited) | |||||||||||
(In millions) | |||||||||||
December 31, |
December 31, | ||||||||||
2015 |
2014 (a) | ||||||||||
ASSETS |
|||||||||||
Current Assets |
$ |
544 |
$ |
555 |
|||||||
Investments and Other Assets |
4,180 |
4,841 |
|||||||||
Net Property, Plant and Equipment |
13,837 |
12,135 |
|||||||||
Regulatory Assets and Deferred Debits |
290 |
247 |
|||||||||
Total Assets |
$ |
18,851 |
$ |
17,778 |
|||||||
LIABILITIES AND EQUITY |
|||||||||||
Current Liabilities |
$ |
1,471 |
$ |
1,482 |
|||||||
Long-term Debt |
5,845 |
5,134 |
|||||||||
Deferred Credits and Other Liabilities |
189 |
156 |
|||||||||
Equity |
11,346 |
11,006 |
|||||||||
Total Liabilities and Equity |
$ |
18,851 |
$ |
17,778 |
|||||||
(a) |
The debt issuance costs of $15 million previously reported in Regulatory Assets and Deferred Credits at December 31, 2014 was retrospectively reclassified as a reduction to Long-term Debt at that date, as a result of the adoption of a new accounting standard. | ||||||||||
Spectra Energy Partners, LP |
||||||||||||||||||||||||
Distributable Cash Flow |
||||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||||
(in millions) |
||||||||||||||||||||||||
Quarters Ended December 31, |
Years Ended |
|||||||||||||||||||||||
2015 |
2014 |
2015 |
2014 |
|||||||||||||||||||||
Net Income |
$ 317 |
$ 290 |
$ 1,265 |
$ 1,027 |
||||||||||||||||||||
Add: |
||||||||||||||||||||||||
Interest expense |
60 |
55 |
239 |
238 |
||||||||||||||||||||
Income tax expense |
4 |
6 |
12 |
35 |
||||||||||||||||||||
Depreciation and amortization |
75 |
72 |
295 |
288 |
||||||||||||||||||||
Foreign currency loss |
1 |
1 |
6 |
3 |
||||||||||||||||||||
Less: |
||||||||||||||||||||||||
Third party interest income |
- |
- |
1 |
- |
||||||||||||||||||||
EBITDA |
457 |
424 |
1,816 |
1,591 |
||||||||||||||||||||
Add: |
||||||||||||||||||||||||
Earnings from equity investments |
(33) |
(40) |
(167) |
(133) |
||||||||||||||||||||
Distributions from equity investments (a) |
24 |
45 |
207 |
165 |
||||||||||||||||||||
Non-cash impairment on Ozark Gas Gathering |
- |
- |
9 |
- |
||||||||||||||||||||
Other |
4 |
(2) |
12 |
8 |
||||||||||||||||||||
Less: |
||||||||||||||||||||||||
Interest expense |
60 |
55 |
239 |
238 |
||||||||||||||||||||
Equity AFUDC |
26 |
13 |
76 |
33 |
||||||||||||||||||||
Net cash paid for income taxes |
4 |
1 |
12 |
6 |
||||||||||||||||||||
Distributions to non-controlling interests |
8 |
7 |
31 |
29 |
||||||||||||||||||||
Maintenance capital expenditures |
94 |
106 |
314 |
270 |
||||||||||||||||||||
Total Distributable Cash Flow |
$ 260 |
$ 245 |
$ 1,205 |
$ 1,055 |
||||||||||||||||||||
Distributions |
$ 976 |
$ 845 |
||||||||||||||||||||||
Coverage Ratio |
1.2x |
1.2x |
||||||||||||||||||||||
(a) Excludes $403 million and $129 million of distributions from equity affiliates for the twelve month period ended December 31, 2015 and 2014, respectively. |
||||||||||||||||||||||||
Spectra Energy Partners, LP |
||||||||||||||||||||||||
Reported to Ongoing Earnings Reconciliation |
||||||||||||||||||||||||
December 2015 Quarter-to-date |
||||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||||
(In millions) |
||||||||||||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
Reported Earnings |
Special |
Ongoing Earnings |
|||||||||||||||||||||
U.S. Transmission |
$ |
413 |
$ |
— |
$ |
413 |
||||||||||||||||||
Liquids |
62 |
— |
62 |
|||||||||||||||||||||
Total Reportable Segment EBITDA |
475 |
— |
475 |
|||||||||||||||||||||
Other |
(18) |
— |
(18) |
|||||||||||||||||||||
Total Reportable Segment and other EBITDA |
$ |
457 |
$ |
— |
$ |
457 |
||||||||||||||||||
EARNINGS |
||||||||||||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
457 |
$ |
— |
$ |
457 |
||||||||||||||||||
Depreciation and Amortization |
(75) |
— |
(75) |
|||||||||||||||||||||
Interest Expense |
(60) |
1 |
A |
(59) |
||||||||||||||||||||
Other Income and Expenses |
(1) |
— |
(1) |
|||||||||||||||||||||
Income Tax Expense |
(4) |
— |
(4) |
|||||||||||||||||||||
Total Net Income |
317 |
1 |
318 |
|||||||||||||||||||||
Total Net Income - Noncontrolling Interests |
(13) |
— |
(13) |
|||||||||||||||||||||
Total Net Income - Controlling Interests |
$ |
304 |
$ |
1 |
$ |
305 |
||||||||||||||||||
A - Net write-off of regulatory assets and liabilities at Ozark Gas Transmission due to discontinuance of regulatory accounting.
|
||||||||||||||||||||||||
Spectra Energy Partners, LP |
|||||||||||||||
Reported to Ongoing Earnings Reconciliation |
|||||||||||||||
December 2015 Year-to-date |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In millions) |
|||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported Earnings |
Special |
Ongoing Earnings |
||||||||||||
U.S. Transmission |
$ |
1,599 |
$ |
9 |
A |
$ |
1,608 |
||||||||
Liquids |
283 |
— |
283 |
||||||||||||
Total Reportable Segment EBITDA |
1,882 |
9 |
1,891 |
||||||||||||
Other |
(66) |
— |
(66) |
||||||||||||
Total Reportable Segment and other EBITDA |
$ |
1,816 |
$ |
9 |
$ |
1,825 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
1,816 |
$ |
9 |
$ |
1,825 |
|||||||||
Depreciation and Amortization |
(295) |
— |
(295) |
||||||||||||
Interest Expense |
(239) |
1 |
B |
(238) |
|||||||||||
Other Income and Expenses |
(5) |
— |
(5) |
||||||||||||
Income Tax Expense |
(12) |
— |
(12) |
||||||||||||
Total Net Income |
1,265 |
10 |
1,275 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(40) |
— |
(40) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
1,225 |
$ |
10 |
$ |
1,235 |
|||||||||
A - Asset impairment at Ozark Gas Gathering. |
|||||||||||||||
B - Net write-off of regulatory assets and liabilities at Ozark Gas Transmission due to discontinuance of regulatory accounting.
|
|||||||||||||||
Spectra Energy Partners, LP |
|||||||
Reported to Ongoing Earnings Reconciliation |
|||||||
December 2014 Quarter-to-date |
|||||||
(Unaudited) |
|||||||
(In millions) |
|||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported/ |
||||||
U.S. Transmission |
$ |
369 |
|||||
Liquids |
71 |
||||||
Total Reportable Segment EBITDA |
440 |
||||||
Other |
(16) |
||||||
Total Reportable Segment and other EBITDA |
$ |
424 |
|||||
EARNINGS |
|||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
424 |
|||||
Depreciation and Amortization |
(72) |
||||||
Interest Expense |
(55) |
||||||
Other Income and Expenses |
(1) |
||||||
Income Tax Expense |
(6) |
||||||
Total Net Income |
290 |
||||||
Total Net Income - Noncontrolling Interests |
(7) |
||||||
Total Net Income - Controlling Interests |
$ |
283 |
|||||
Spectra Energy Partners, LP |
|||||||||||||||
Reported to Ongoing Earnings Reconciliation |
|||||||||||||||
December 2014 Year-to-date |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In millions) |
|||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
Reported Earnings |
Special |
Ongoing Earnings |
||||||||||||
U.S. Transmission |
$ |
1,415 |
$ |
— |
$ |
1,415 |
|||||||||
Liquids |
240 |
— |
240 |
||||||||||||
Total Reportable Segment EBITDA |
1,655 |
— |
1,655 |
||||||||||||
Other |
(64) |
— |
(64) |
||||||||||||
Total Reportable Segment and other EBITDA |
$ |
1,591 |
$ |
— |
$ |
1,591 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
1,591 |
$ |
— |
$ |
1,591 |
|||||||||
Depreciation and Amortization |
(288) |
— |
(288) |
||||||||||||
Interest Expense |
(238) |
— |
(238) |
||||||||||||
Other Income and Expenses |
(3) |
— |
(3) |
||||||||||||
Income Tax Expense |
(35) |
23 |
A |
(12) |
|||||||||||
Total Net Income |
1,027 |
23 |
1,050 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(23) |
— |
(23) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
1,004 |
$ |
23 |
$ |
1,027 |
|||||||||
A - Adjustment of federal income tax liabilities related to the dropdown. |
Logo - http://photos.prnewswire.com/prnh/20071107/CLW064
SOURCE Spectra Energy Partners, LP
HOUSTON, Feb. 3, 2016 /PRNewswire/ --
Year-End Highlights:
Spectra Energy Corp (NYSE: SE) today reported fourth quarter and year-end 2015 financial results. For the quarter, ongoing earnings before interest, taxes, depreciation, and amortization (EBITDA) were $672 million, compared with $810 million in the prior-year quarter. For the year, ongoing EBITDA was $2.75 billion, compared with $3.15 billion in the prior year.
Ongoing distributable cash flow (DCF) for the quarter was $201 million, compared with $316 million in the same quarter last year. For the year, ongoing DCF was $1.29 billion, compared with $1.46 billion in 2014.
Fourth quarter 2015 ongoing net income from controlling interests was $189 million, or $0.28 diluted earnings per share (EPS), compared with $316 million, or $0.47 diluted EPS, during the prior-year quarter. Reported net income from controlling interests for the quarter was $(263) million, or $(0.39) diluted EPS, compared with $316 million, or $0.47 diluted EPS, in 2014. Fourth quarter 2015 results include special items of $452 million, or $0.67 diluted EPS, driven largely by non-cash goodwill and asset impairments totaling $445 million.
Ongoing net income from controlling interests was $775 million in 2015, or $1.15 diluted EPS, compared with $1.09 billion, or $1.62 diluted EPS, during the prior year. Reported net income from controlling interests was $196 million in 2015, or $0.29 diluted EPS, compared with $1.08 billion, or $1.61 diluted EPS, in 2014. Full year 2015 results include special items of $579 million, or $0.86 diluted EPS, driven largely by non-cash goodwill and asset impairments totaling $561 million.
Tables detailing the fourth quarter and full-year special items are shown later in this release.
CEO COMMENT
"Our 2015 results illustrate the resiliency of our business model. Even in a year with dramatically lower commodity prices and a lower Canadian dollar than we had projected, we managed to beat our DCF expectations by 7 percent and ended the year with a higher than expected dividend coverage ratio of 1.3 times," said Greg Ebel, chief executive officer, Spectra Energy. "We continued to build on our solid natural gas transmission portfolio, which generates 90 percent of its revenue from long-term, fixed-fee contracts with high credit-quality customers and little volume risk. As a result of this stability, we are positioned to continue providing reliable and growing dividends for our investors, as demonstrated by the 14-cent per share increase for 2016 that we recently announced.
"Looking forward, we continue to have more than $8 billion of contractually secured projects in our execution backlog, 75 percent of which are supported by demand-pull customers such as local utilities. The growing demand for our assets, as well as the decisive actions we took in 2015 to strengthen our business, have prepared us well for 2016 and beyond."
SEGMENT RESULTS
Spectra Energy Partners
Spectra Energy Partners reported fourth quarter 2015 EBITDA of $484 million, compared with $444 million in fourth quarter 2014. These results reflect increased earnings from expansion projects in the natural gas transmission business. The increase was partially offset by lower equity earnings from Sand Hills and Southern Hills natural gas liquids (NGL) pipelines, which Spectra Energy Partners owned for approximately one month of the quarter.
Year-end 2015 ongoing EBITDA for Spectra Energy Partners was $1.91 billion, compared with $1.67 billion in 2014. The 2015 period excludes a special item of $9 million related to a non-cash impairment of the Ozark Gas Gathering asset.
Distribution
Distribution reported fourth quarter 2015 EBITDA of $113 million, compared with $132 million in fourth quarter 2014. The decrease was mainly due to the effect of a lower Canadian dollar.
Year-end 2015 EBITDA for Distribution was $473 million, compared with $552 million in 2014.
Western Canada Transmission & Processing
Western Canada Transmission & Processing fourth quarter 2015 ongoing EBITDA was $123 million, compared with $250 million in fourth quarter 2014. The 2015 period excludes special items of $7 million for employee and overhead reductions and $7 million for a non-cash asset impairment. The segment's ongoing results reflect the effect of a lower Canadian dollar and lower earnings at Empress, largely due to the net effect of the unrealized mark-to-market value associated with the risk management program.
Year-end 2015 ongoing EBITDA for Western Canada Transmission & Processing was $516 million, compared with $754 million in 2014. The 2015 period excludes special items totaling $25 million, which were primarily associated with employee and overhead reductions.
Field Services
Spectra Energy reported ongoing EBITDA from Field Services of $(36) million in fourth quarter 2015, compared with $(18) million in fourth quarter 2014. The 2015 period excludes special items of $172 million, primarily from non-cash asset impairments as a result of the continuing low commodity price environment. The decrease in ongoing EBITDA was primarily attributable to lower commodity prices, partially offset by asset growth, improved operating efficiencies, and other initiatives, as well as the increase in ownership of the Sand Hills and Southern Hills NGL pipelines for approximately two months of the quarter. As a reminder, Spectra Energy's EBITDA from Field Services represents the company's 50 percent share of DCP Midstream's net income plus gains from DPM unit issuances.
During the fourth quarters of 2015 and 2014, respectively, NGL prices averaged $0.42 per gallon versus $0.68 per gallon, NYMEX natural gas averaged $2.27 per million British thermal units (MMBtu) versus $4.00 per MMBtu, and crude oil averaged approximately $42 per barrel versus $73 per barrel.
On a full-year basis for 2015 and 2014, respectively, NGL prices averaged $0.45 per gallon versus $0.89 per gallon, NYMEX natural gas averaged $2.66 per MMBtu versus $4.41 per MMBtu, and crude oil averaged approximately $49 per barrel versus $93 per barrel.
Year-end 2015 ongoing EBITDA for Field Services was $(106) million, compared with $229 million in 2014. The 2015 period excludes special items of $355 million, primarily due to non-cash goodwill and asset impairments. The 2014 period excludes special items of $12 million, primarily due to a non-cash goodwill impairment.
Other
"Other" reported ongoing net expenses of $12 million and a net benefit of $2 million in the fourth quarters of 2015 and 2014, respectively, reflecting higher corporate costs, including employee benefits costs. Full-year 2015 ongoing net expenses for "Other" were $51 million, compared with $58 million in 2014. Both the 2015 quarter and year-end periods exclude a special item of $333 million related to non-cash goodwill impairments associated with the Westcoast acquisition in 2002.
"Other" primarily consists of corporate expenses, including benefits, and captive insurance.
ADDITIONAL FINANCIAL INFORMATION
Interest Expense
Interest expense was $156 million in fourth quarter 2015, compared with $158 million in fourth quarter 2014, reflecting a lower Canadian dollar and lower average rates, partially offset by higher average long-term debt balances.
Income Taxes
Excluding a $62 million tax benefit related to asset impairments in the current quarter, income tax expense was $59 million in fourth quarter 2015, compared with $77 million in fourth quarter 2014. The decrease in tax expense was mainly due to lower earnings and a lower effective state tax rate.
Excluding the tax impact of special items, the effective tax rate was 20 percent in fourth quarter 2015, compared with 17 percent in fourth quarter 2014.
Foreign Currency
Net income from controlling interests for the quarter was lower by $6 million due to the lower Canadian dollar.
Liquidity and Capital Expenditures
Total debt outstanding at Spectra Energy as of December 31, 2015, was $14.7 billion. Total Spectra Energy liquidity at the end of the quarter was $2.8 billion, including $1.7 billion of available liquidity at Spectra Energy Partners. Total capital and investment spending for the quarter was $1.06 billion, excluding contributions from noncontrolling interests. The spending consisted of $848 million of growth capital expenditures and $216 million of maintenance capital expenditures.
For the year, total capital and investment spending was $2.97 billion, excluding contributions from noncontrolling interests, and was mainly comprised of approximately $2.28 billion of growth capital expenditures and $691 million of maintenance capital expenditures.
Effects of Fourth Quarter 2015 Special Items
($MM) |
EBITDA |
Net Income(1) |
EPS |
Cash |
Ongoing |
$ 672 |
$ 189 |
$ 0.28 |
|
Adjustments related to Special Items |
||||
Goodwill impairments (2) |
$ (333) |
$ (333) |
$ (0.49) |
$ 0 |
DCP special items |
(172) |
(110) |
(0.16) |
0 |
Other special items |
(14) |
(9) |
(0.02) |
(7) |
Total Special Items |
$ (519) |
$ (452) |
$ (0.67) |
$ (7) |
Reported |
$ 153 |
$ (263) |
$ (0.39) |
|
(1) Represents net income from controlling interests (2) Recorded in Other at SE |
Effects of Year-to-Date 2015 Special Items
($MM) |
EBITDA |
Net Income(1) |
EPS |
Cash |
Ongoing |
$2,746 |
$ 775 |
$ 1.15 |
|
Adjustments related to Special Items |
||||
Goodwill impairments (2) |
$ (333) |
$ (333) |
$ (0.49) |
$ 0 |
DCP special items |
(355) |
(224) |
(0.33) |
0 |
Other special items |
(34) |
(22) |
(0.04) |
(18) |
Total Special Items |
$ (722) |
$ (579) |
$ (0.86) |
$ (18) |
Reported |
$ 2,024 |
$ 196 |
$ 0.29 |
|
(1) Represents net income from controlling interests (2) Recorded in Other at SE |
EXPANSION PROJECT UPDATES
Spectra Energy continues to make progress on securing $35 billion in new projects by the end of the decade. At the end of 2015, the company had:
Spectra Energy Partners
Spectra Energy Partners has advanced numerous projects across the system. The company filed Federal Energy Regulatory Commission (FERC) certificate applications in the quarter for the Atlantic Bridge, Access South, Adair Southwest, and Lebanon Extension projects.
The NEXUS project, which is supported by local distribution companies (LDCs) as well as Marcellus and Utica producers, also filed its application with FERC, and reached another regulatory milestone in the quarter with the receipt of Ontario Energy Board (OEB) approval for the Canadian utility shippers. The joint venture with DTE will allow customers to move up to 1.5 billion cubic feet per day (Bcf/d) through Ohio and Michigan markets to the Dawn Hub, which is the second largest physically traded gas hub in North America and is owned and operated by Union Gas. NEXUS has secured additional connections with four natural gas distribution companies in Ohio, including the two largest in the state, two natural gas-fired power plants, and three industrial parks, demonstrating the value of the project path connecting to the largest natural gas supply source in North America. These connections could add incremental load across northern Ohio of up to 1.4 Bcf/d. NEXUS is on target for a November 2017 in-service date.
The AIM project, supported by New England LDCs, has made significant construction progress and is well on the way to its planned in-service date in the second half of 2016. A number of other projects are on track to meet their respective in-service dates, including the Sabal Trail, Ozark, Salem Lateral, Gulf Markets, Loudon Expansion, TEAL, and PennEast projects.
In the liquids business, the Express Enhancement project is supported by long-term contracts and is on schedule for completion by the end of 2016. The strong response to this system optimization project demonstrates that the Express pipeline's incumbent position is a substantial advantage in responding quickly to market demand.
Access Northeast is focused on the New England electric power market and saving consumers money while improving the reliability of the region's energy system. This solution maximizes existing infrastructure corridors, by utilizing the Algonquin and Maritimes & Northeast pipelines, which directly connect to more than 60 percent of the ISO-New England power plants. In addition, the four new natural gas-fired electric generation plants that have cleared the 2017 and 2018 ISO-NE forward capacity auctions will be located on the Algonquin pipeline, further demonstrating the company's very strong position in New England.
Access Northeast will carry natural gas from the least expensive supply areas, via multiple optional paths, directly to the majority of the power plants in New England. It will cost-effectively deliver supply when power generators need it, with new tariff services to handle the peak hour, quick start, and seasonal needs.
Access Northeast submitted its FERC pre-file application during the quarter and has recently executed electric distribution contracts in Massachusetts equaling more than 40 percent of the 0.9 Bcf/d capacity designed for generators. Progress is being made in other states, and Access Northeast anticipates state approvals for contracts later this year. The project continues to advance toward a late 2018 initial in-service date.
Distribution
Union Gas' storage and transmission system continues to grow and increase in importance to Eastern Canada and the Northeast U.S.
The 2015 Dawn-Parkway expansion project was placed into service on time and under budget during the quarter. Future growth opportunities also solidified with OEB approvals for the 2016 and 2017 Dawn-Parkway expansions, along with the Burlington-Oakville transmission reinforcement project. These expansion projects are now in execution and on schedule for their respective in-service dates.
Western Canada Transmission & Processing
Western Canada originated two new supply-push projects in 2015, totaling about 290 million cubic feet per day in capacity: High Pine and Wyndwood. These projects are underpinned by long-term contracts with Montney producers holding substantial land bases and seeking markets at Station 2 in British Columbia, AECO in Alberta, as well as export markets via multiple paths. High Pine is on schedule to go into service in 2016, while Wyndwood, which was placed into execution in the fourth quarter, has an expected in-service date of 2018. Both projects will drive growth on the company's BC Pipeline, which provides producer access to downstream markets.
The Jackfish Lake project is proceeding on schedule to be in service in 2017. The RAM project will increase reliability and maintainability on our fully contracted 1.5 Bcf/d T-South system, is proceeding on schedule, and will come on-line in stages, with full in-service in 2018. Upon completion, RAM will allow significantly higher summer load factors than previous years, to meet increased demands for low-cost British Columbia production in the Pacific Northwest.
High Pine, Jackfish Lake and RAM were all filed with the National Energy Board (NEB) during the quarter.
Additional Information
Additional information about fourth quarter 2015 earnings can be obtained via the Spectra Energy website: www.spectraenergy.com.
The analyst call, held jointly with Spectra Energy Partners, is scheduled for today, Wednesday, February 3, 2016, at 8 a.m. CT. The webcast will be available via the Investors sections of the Spectra Energy and Spectra Energy Partners websites. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 89326071 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Tuesday, May 3, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Investors sections of the Spectra Energy and Spectra Energy Partners websites.
Non-GAAP Financial Measures
We use ongoing net income from controlling interests and ongoing diluted EPS as measures to evaluate operations of the company. These measures are non-GAAP financial measures as they represent net income from controlling interests and diluted EPS, excluding special items. Special items represent certain charges and credits which we believe will not be recurring on a regular basis. We believe that the presentation of ongoing net income from controlling interests and ongoing diluted EPS provides useful information to investors, as it allows investors to more accurately compare our ongoing performance across periods. The most directly comparable GAAP measures for ongoing net income from controlling interests and ongoing diluted EPS are reported net income from controlling interests and reported diluted EPS.
We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (EBITDA) and ongoing EBITDA, non-GAAP financial measures, as performance measures for Spectra Energy Corp. Ongoing EBITDA represents EBITDA excluding special items. We believe that the presentation of EBITDA and ongoing EBITDA provides useful information to investors, as it allows investors to more accurately compare Spectra Energy Corp's performance across periods. The most directly comparable GAAP measure for EBITDA and ongoing EBITDA for Spectra Energy Corp is net income.
The primary performance measure used by us to evaluate segment performance is segment EBITDA. We consider segment EBITDA, which is the GAAP measure used to report segment results, to be a good indicator of each segment's operating performance from its continuing operations as it represents the results of our segments' operations before depreciation and amortization without regard to financing methods or capital structures. Our segment EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA and ongoing Other EBITDA (net expenses) as measures of performance. Ongoing segment EBITDA and ongoing Other EBITDA are non-GAAP financial measures, as they represent reported segment EBITDA and reported Other EBITDA, excluding special items. We believe that the presentation of ongoing segment EBITDA and ongoing Other EBITDA provides useful information to investors, as it allows investors to more accurately compare a segment's or Other's ongoing performance across periods. The most directly comparable GAAP measures for ongoing segment EBITDA and ongoing Other EBITDA are reported segment EBITDA and reported Other EBITDA.
We have also presented Distributable Cash Flow (DCF), which is a non-GAAP financial measure. We believe that the presentation of DCF provides useful information to investors, as it represents the cash generation capabilities of the company to support dividend growth. We also use ongoing DCF, which is a non-GAAP financial measure, as it represents DCF excluding the cash effect of special items. The most directly comparable GAAP measure for DCF and ongoing DCF is net income. We also use DCF coverage, which is a non-GAAP financial measure, as it represents DCF divided by dividends declared on common stock. The most directly comparable GAAP measure for DCF coverage is reported EPS.
The non-GAAP financial measures presented in this press release should not be considered in isolation or as an alternative to financial measures presented in accordance with GAAP. These non-GAAP financial measures may not be comparable to similarly titled measures of other companies because other companies may not calculate these measures in the same manner.
Forward-Looking Statements
This 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. Forward-looking statements are based on our beliefs and assumptions. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries; outcomes of litigation and regulatory investigations, proceedings or inquiries; weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services; potential effects arising from terrorist attacks and any consequential or other hostilities; changes in environmental, safety and other laws and regulations; the development of alternative energy resources; results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions; increases in the cost of goods and services required to complete capital projects; declines in the market prices of equity and debt securities and resulting funding requirements for defined benefit pension plans; growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering, processing and other related infrastructure projects and the effects of competition; the performance of natural gas and oil transmission and storage, distribution, and gathering and processing facilities; the extent of success in connecting natural gas and oil supplies to gathering, processing and transmission systems and in connecting to expanding gas and oil markets; the effects of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets during the periods covered by forward-looking statements; and the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture. These factors, as well as additional factors that could affect our forward-looking statements, are described under the headings "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in our 2014 Form 10-K, filed on February 27, 2015, and in our other filings made with the Securities and Exchange Commission (SEC), which are available via the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. All forward-looking statements in this release are made as of the date hereof and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com and www.spectraenergypartners.com.
Spectra Energy Corp | ||||||||||||||||
Quarterly Highlights | ||||||||||||||||
December 2015 | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except per-share amounts and where noted) | ||||||||||||||||
These results include the impact of special items | ||||||||||||||||
Quarters Ended |
Years Ended | |||||||||||||||
2015 |
2014 |
2015 |
2014 | |||||||||||||
COMMON STOCK DATA |
||||||||||||||||
Earnings (Loss) Per Share, Diluted |
$ |
(0.39) |
$ |
0.47 |
$ |
0.29 |
$ |
1.61 |
||||||||
Dividends Per Share |
$ |
0.370 |
$ |
0.370 |
$ |
1.480 |
$ |
1.375 |
||||||||
Weighted-Average Shares Outstanding, Diluted |
673 |
672 |
672 |
672 |
||||||||||||
INCOME |
||||||||||||||||
Operating Revenues |
$ |
1,316 |
$ |
1,600 |
$ |
5,234 |
$ |
5,903 |
||||||||
Total Reportable Segment EBITDA |
498 |
808 |
2,408 |
3,192 |
||||||||||||
Net Income (Loss) - Controlling Interests |
(263) |
316 |
196 |
1,082 |
||||||||||||
EBITDA BY BUSINESS SEGMENT |
||||||||||||||||
Spectra Energy Partners |
$ |
484 |
$ |
444 |
$ |
1,905 |
$ |
1,669 |
||||||||
Distribution |
113 |
132 |
473 |
552 |
||||||||||||
Western Canada Transmission & Processing |
109 |
250 |
491 |
754 |
||||||||||||
Field Services |
(208) |
(18) |
(461) |
217 |
||||||||||||
Total Reportable Segment EBITDA |
498 |
808 |
2,408 |
3,192 |
||||||||||||
Other EBITDA |
(345) |
2 |
(384) |
(58) |
||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
153 |
$ |
810 |
$ |
2,024 |
$ |
3,134 |
||||||||
DISTRIBUTABLE CASH FLOW |
||||||||||||||||
Distributable Cash Flow |
$ |
194 |
$ |
316 |
$ |
1,274 |
$ |
1,460 |
||||||||
Coverage Ratio |
1.3x |
1.6x |
||||||||||||||
CAPITAL AND INVESTMENT EXPENDITURES |
||||||||||||||||
Spectra Energy Partners (a) |
$ |
2,007 |
$ |
1,241 |
||||||||||||
Distribution |
544 |
427 |
||||||||||||||
Western Canada Transmission & Processing |
360 |
473 |
||||||||||||||
Other (b) |
61 |
146 |
||||||||||||||
Total Capital and Investment Expenditures (a,b) |
$ |
2,972 |
$ |
2,287 |
||||||||||||
Expansion and Investment (a,b) |
$ |
2,281 |
$ |
1,547 |
||||||||||||
Maintenance and Other |
691 |
740 |
||||||||||||||
Total Capital and Investment Expenditures (a,b) |
$ |
2,972 |
$ |
2,287 |
||||||||||||
December 31, | ||||||||||||||||
2015 |
2014 | |||||||||||||||
CAPITALIZATION |
||||||||||||||||
Common Equity - Controlling Interests |
26.6 |
% |
32.2 |
% | ||||||||||||
Noncontrolling Interests and Preferred Stock |
13.6 |
% |
9.9 |
% | ||||||||||||
Total Debt |
59.8 |
% |
57.9 |
% | ||||||||||||
Total Debt |
$ |
14,656 |
$ |
14,637 |
||||||||||||
Book Value Per Share (c) |
$ |
9.73 |
$ |
12.16 |
||||||||||||
Actual Shares Outstanding |
671 |
671 |
||||||||||||||
(a) Excludes contributions received from noncontrolling interests of $216 million in 2015 and $53 million in 2014. 2014 period includes an investment in SESH of $94 million, used by SESH to retire debt. | ||||||||||||||||
(b) 2014 period includes an investment in SESH of $95 million, used by SESH to retire debt. | ||||||||||||||||
(c) Represents controlling interests. |
Spectra Energy Corp | |||||||||||||||||||||||||||
Quarters Ended |
Years Ended | ||||||||||||||||||||||||||
2015 |
2014 |
2015 |
2014 | ||||||||||||||||||||||||
SPECTRA ENERGY PARTNERS |
|||||||||||||||||||||||||||
Operating Revenues |
$ |
634 |
$ |
599 |
$ |
2,455 |
$ |
2,269 |
|||||||||||||||||||
Operating Expenses |
|||||||||||||||||||||||||||
Operating, Maintenance and Other |
222 |
213 |
828 |
781 |
|||||||||||||||||||||||
Other Income and Expenses |
72 |
58 |
278 |
181 |
|||||||||||||||||||||||
EBITDA |
$ |
484 |
$ |
444 |
$ |
1,905 |
$ |
1,669 |
|||||||||||||||||||
Express Pipeline Revenue Receipts, MBbl/d (a) |
239 |
240 |
239 |
223 |
|||||||||||||||||||||||
Platte PADD II Deliveries, MBbl/d |
140 |
168 |
162 |
170 |
|||||||||||||||||||||||
DISTRIBUTION |
|||||||||||||||||||||||||||
Operating Revenues |
$ |
366 |
$ |
505 |
$ |
1,527 |
$ |
1,843 |
|||||||||||||||||||
Operating Expenses |
|||||||||||||||||||||||||||
Natural Gas Purchased |
152 |
261 |
691 |
879 |
|||||||||||||||||||||||
Operating, Maintenance and Other |
101 |
112 |
363 |
411 |
|||||||||||||||||||||||
Other Income and Expenses |
— |
— |
— |
(1) |
|||||||||||||||||||||||
EBITDA |
$ |
113 |
$ |
132 |
$ |
473 |
$ |
552 |
|||||||||||||||||||
Number of Customers, Thousands |
1,437 |
1,420 |
|||||||||||||||||||||||||
Heating Degree Days, Fahrenheit |
2,017 |
2,527 |
7,387 |
8,111 |
|||||||||||||||||||||||
Pipeline Throughput, TBtu (b) |
165 |
177 |
759 |
713 |
|||||||||||||||||||||||
Canadian Dollar Exchange Rate, Average |
1.34 |
1.14 |
1.28 |
1.10 |
|||||||||||||||||||||||
WESTERN CANADA TRANSMISSION & PROCESSING |
|||||||||||||||||||||||||||
Operating Revenues |
$ |
323 |
$ |
519 |
$ |
1,285 |
$ |
1,902 |
|||||||||||||||||||
Operating Expenses |
|||||||||||||||||||||||||||
Natural Gas and Petroleum Products Purchased |
69 |
114 |
193 |
466 |
|||||||||||||||||||||||
Operating, Maintenance and Other |
149 |
159 |
611 |
687 |
|||||||||||||||||||||||
Other Income and Expenses |
4 |
4 |
10 |
5 |
|||||||||||||||||||||||
EBITDA |
$ |
109 |
$ |
250 |
$ |
491 |
$ |
754 |
|||||||||||||||||||
Pipeline Throughput, TBtu |
234 |
249 |
923 |
934 |
|||||||||||||||||||||||
Volumes Processed, TBtu |
165 |
190 |
658 |
721 |
|||||||||||||||||||||||
Canadian Dollar Exchange Rate, Average |
1.34 |
1.14 |
1.28 |
1.10 |
|||||||||||||||||||||||
FIELD SERVICES |
|||||||||||||||||||||||||||
Equity in Earnings (Loss) of DCP Midstream, LLC |
$ |
(208) |
$ |
(18) |
$ |
(461) |
$ |
217 |
|||||||||||||||||||
Cash Distributions to Spectra Energy |
$ |
— |
$ |
58 |
$ |
— |
$ |
237 |
|||||||||||||||||||
Natural Gas Gathered and Processed/Transported, TBtu/day (d) |
7.1 |
7.4 |
7.1 |
7.3 |
|||||||||||||||||||||||
Natural Gas Liquids Production, MBbl/d (c) |
409 |
447 |
410 |
454 |
|||||||||||||||||||||||
Average Natural Gas Price Per MMBtu (d) |
$ |
2.27 |
$ |
4.00 |
$ |
2.66 |
$ |
4.41 |
|||||||||||||||||||
Average Natural Gas Liquids Price Per Gallon (e) |
$ |
0.42 |
$ |
0.68 |
$ |
0.45 |
$ |
0.89 |
|||||||||||||||||||
Average Crude Oil Price Per Barrel (f) |
$ |
42.20 |
$ |
73.33 |
$ |
48.80 |
$ |
93.06 |
|||||||||||||||||||
(a) Thousand barrels per day. |
Spectra Energy Corp | |||||||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
(In millions) | |||||||||||||||||||
These results include the impact of special items | |||||||||||||||||||
Quarters Ended |
Years Ended | ||||||||||||||||||
2015 |
2014 |
2015 |
2014 | ||||||||||||||||
Operating Revenues |
$ |
1,316 |
$ |
1,600 |
$ |
5,234 |
$ |
5,903 |
|||||||||||
Operating Expenses |
1,219 |
1,035 |
3,801 |
3,979 |
|||||||||||||||
Operating Income |
97 |
565 |
1,433 |
1,924 |
|||||||||||||||
Other Income and Expenses |
(132) |
44 |
(176) |
420 |
|||||||||||||||
Interest Expense |
156 |
158 |
636 |
679 |
|||||||||||||||
Earnings (Loss) Before Income Taxes |
(191) |
451 |
621 |
1,665 |
|||||||||||||||
Income Tax Expense (Benefit) |
(3) |
77 |
161 |
382 |
|||||||||||||||
Net Income (Loss) |
(188) |
374 |
460 |
1,283 |
|||||||||||||||
Net Income - Noncontrolling Interests |
75 |
58 |
264 |
201 |
|||||||||||||||
Net Income (Loss) - Controlling Interests |
$ |
(263) |
$ |
316 |
$ |
196 |
$ |
1,082 |
Spectra Energy Corp | |||||||||||
Condensed Consolidated Balance Sheets | |||||||||||
(Unaudited) | |||||||||||
(In millions) | |||||||||||
December 31, |
December 31, | ||||||||||
2015 |
2014 (a) | ||||||||||
ASSETS |
|||||||||||
Current Assets |
$ |
1,648 |
$ |
2,332 |
|||||||
Investments and Other Assets |
7,056 |
8,007 |
|||||||||
Net Property, Plant and Equipment |
22,918 |
22,307 |
|||||||||
Regulatory Assets and Deferred Debits |
1,301 |
1,352 |
|||||||||
Total Assets |
$ |
32,923 |
$ |
33,998 |
|||||||
LIABILITIES AND EQUITY |
|||||||||||
Current Liabilities |
$ |
3,392 |
$ |
3,809 |
|||||||
Long-term Debt |
12,892 |
12,727 |
|||||||||
Deferred Credits and Other Liabilities |
6,768 |
6,806 |
|||||||||
Preferred Stock of Subsidiaries |
339 |
258 |
|||||||||
Equity |
9,532 |
10,398 |
|||||||||
Total Liabilities and Equity |
$ |
32,923 |
$ |
33,998 |
|||||||
(a) |
The debt issuance costs of $42 million previously reported in Regulatory Assets and Deferred Credits at December 31, 2014 was retrospectively reclassified as a reduction to Long-term Debt at that date, as a result of the adoption of a new accounting standard. | ||||||||||
Spectra Energy Corp | ||||||||||||||||
Distributable Cash Flow | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions) | ||||||||||||||||
Quarters Ended December 31, |
Years Ended December 31, | |||||||||||||||
2015 |
2014 |
2015 |
2014 | |||||||||||||
Net Income (Loss) |
$ |
(188) |
$ |
374 |
$ |
460 |
$ |
1,283 |
||||||||
Add: |
||||||||||||||||
Interest expense |
156 |
158 |
636 |
679 |
||||||||||||
Income tax expense (benefit) |
(3) |
77 |
161 |
382 |
||||||||||||
Depreciation and amortization |
190 |
196 |
764 |
796 |
||||||||||||
Foreign currency loss (gain) |
(1) |
5 |
6 |
(3) |
||||||||||||
Less: |
||||||||||||||||
Third party interest income |
1 |
— |
3 |
3 |
||||||||||||
EBITDA |
153 |
810 |
2,024 |
3,134 |
||||||||||||
Add: |
||||||||||||||||
Earnings from equity investments |
4 |
(24) |
(76) |
(370) |
||||||||||||
Non-cash impairments at DCP |
169 |
— |
366 |
9 |
||||||||||||
Distributions from equity investments (a) |
26 |
107 |
209 |
416 |
||||||||||||
Empress non-cash items |
18 |
(60) |
42 |
(60) |
||||||||||||
Non-cash goodwill impairments associated |
333 |
— |
333 |
— |
||||||||||||
Other non-cash asset impairments (b) |
7 |
— |
16 |
— |
||||||||||||
Other |
(5) |
(28) |
25 |
(19) |
||||||||||||
Less: |
||||||||||||||||
Interest expense |
156 |
158 |
636 |
679 |
||||||||||||
Equity AFUDC |
38 |
20 |
111 |
53 |
||||||||||||
Net cash paid (refund) for income taxes |
49 |
(16) |
29 |
(8) |
||||||||||||
Distributions to noncontrolling interests |
58 |
47 |
198 |
175 |
||||||||||||
Maintenance capital expenditures |
210 |
280 |
691 |
751 |
||||||||||||
Total Distributable Cash Flow |
$ |
194 |
$ |
316 |
$ |
1,274 |
$ |
1,460 |
||||||||
(a) Excludes $403 million and $230 million in distributions from equity investments for the years ended December 31, 2015 and 2014, respectively. | ||||||||||||||||
(b) Includes non-cash asset impairments at SEP and at WCTP. |
Spectra Energy Corp | ||||||||||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||||||||||
December 2015 Quarter-to-Date | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(In millions, except per-share amounts) | ||||||||||||||||
Reported Earnings |
Special Items |
Ongoing Earnings |
||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
||||||||||||||||
Spectra Energy Partners |
$ |
484 |
$ |
— |
$ |
484 |
||||||||||
Distribution |
113 |
— |
113 |
|||||||||||||
Western Canada Transmission & Processing |
109 |
14 |
A |
123 |
||||||||||||
Field Services |
(208) |
172 |
B |
(36) |
||||||||||||
Total Reportable Segment EBITDA |
498 |
186 |
684 |
|||||||||||||
Other |
(345) |
333 |
C |
(12) |
||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
153 |
$ |
519 |
$ |
672 |
||||||||||
EARNINGS |
||||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
153 |
$ |
519 |
$ |
672 |
||||||||||
Depreciation and Amortization |
(190) |
— |
(190) |
|||||||||||||
Interest Expense |
(156) |
1 |
D |
(155) |
||||||||||||
Interest Income and Other |
2 |
— |
2 |
|||||||||||||
Income Tax (Expense) Benefit |
3 |
(68) |
(65) |
|||||||||||||
Total Net Income |
(188) |
452 |
264 |
|||||||||||||
Total Net Income - Noncontrolling Interests |
(75) |
— |
(75) |
|||||||||||||
Total Net Income - Controlling Interests |
$ |
(263) |
$ |
452 |
$ |
189 |
||||||||||
EARNINGS (LOSS) PER SHARE, BASIC |
$ |
(0.39) |
$ |
0.67 |
$ |
0.28 |
||||||||||
EARNINGS (LOSS) PER SHARE, DILUTED |
$ |
(0.39) |
$ |
0.67 |
$ |
0.28 |
||||||||||
A - Overhead reduction costs and non-cash asset impairment. |
||||||||||||||||
B - Overhead reduction costs, non-cash asset impairments and write-offs. | ||||||||||||||||
C - Non-cash goodwill impairments associated with the Westcoast acquisition in 2002. | ||||||||||||||||
D - Net write-off of regulatory assets and liabilities at Ozark Gas Transmission due to discontinuance of regulatory accounting. | ||||||||||||||||
Weighted Average Shares (reported and ongoing) - in millions |
||||||||||||||||
Basic |
671 |
|||||||||||||||
Diluted |
673 |
Spectra Energy Corp |
|||||||||||||||||
Reported to Ongoing Earnings Reconciliation |
|||||||||||||||||
December 2015 Year-to-date |
|||||||||||||||||
(Unaudited) |
|||||||||||||||||
(In millions, except per-share amounts) |
|||||||||||||||||
Reported Earnings |
Special Items |
Ongoing Earnings |
|||||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
|||||||||||||||||
Spectra Energy Partners |
$ |
1,905 |
$ |
9 |
A |
$ |
1,914 |
||||||||||
Distribution |
473 |
— |
473 |
||||||||||||||
Western Canada Transmission & Processing |
491 |
25 |
B |
516 |
|||||||||||||
Field Services |
(461) |
355 |
C |
(106) |
|||||||||||||
Total Reportable Segment EBITDA |
2,408 |
389 |
2,797 |
||||||||||||||
Other |
(384) |
333 |
D |
(51) |
|||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
2,024 |
$ |
722 |
$ |
2,746 |
|||||||||||
EARNINGS |
|||||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
2,024 |
$ |
722 |
$ |
2,746 |
|||||||||||
Depreciation and Amortization |
(764) |
— |
(764) |
||||||||||||||
Interest Expense |
(636) |
1 |
E |
(635) |
|||||||||||||
Interest Income and Other |
(3) |
— |
(3) |
||||||||||||||
Income Tax Expense |
(161) |
(143) |
(304) |
||||||||||||||
Total Net Income |
460 |
580 |
1,040 |
||||||||||||||
Total Net Income - Noncontrolling Interests |
(264) |
(1) |
(265) |
||||||||||||||
Total Net Income - Controlling Interests |
$ |
196 |
$ |
579 |
$ |
775 |
|||||||||||
EARNINGS PER SHARE, BASIC |
$ |
0.29 |
$ |
0.86 |
$ |
1.15 |
|||||||||||
EARNINGS PER SHARE, DILUTED |
$ |
0.29 |
$ |
0.86 |
$ |
1.15 |
|||||||||||
A - Non-cash impairment at Ozark Gas Gathering. | |||||||||||||||||
B - Overhead reduction costs and non-cash asset impairment. |
|||||||||||||||||
C - Overhead reduction costs, net gain on asset sales, and non-cash goodwill and asset impairments and write-offs. | |||||||||||||||||
D - Non-cash goodwill impairments associated with the Westcoast acquisition in 2002. | |||||||||||||||||
E - Net write-off of regulatory assets and liabilities at Ozark Gas Transmission due to discontinuance of regulatory accounting. | |||||||||||||||||
Weighted Average Shares (reported and ongoing) - in millions |
|||||||||||||||||
Basic |
671 |
||||||||||||||||
Diluted |
672 |
Spectra Energy Corp | ||||||||
Reported to Ongoing Earnings Reconciliation | ||||||||
December 2014 Quarter-to-date | ||||||||
(Unaudited) | ||||||||
(In millions, except per-share amounts) | ||||||||
Reported/ Ongoing Earnings |
||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND |
||||||||
Spectra Energy Partners |
$ |
444 |
||||||
Distribution |
132 |
|||||||
Western Canada Transmission & Processing |
250 |
|||||||
Field Services |
(18) |
|||||||
Total Reportable Segment EBITDA |
808 |
|||||||
Other |
2 |
|||||||
Total Reportable Segment and Other EBITDA |
$ |
810 |
||||||
EARNINGS |
||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
810 |
||||||
Depreciation and Amortization |
(196) |
|||||||
Interest Expense |
(158) |
|||||||
Interest Income and Other |
(5) |
|||||||
Income Tax Expense |
(77) |
|||||||
Total Net Income |
374 |
|||||||
Total Net Income - Noncontrolling Interests |
(58) |
|||||||
Total Net Income - Controlling Interests |
$ |
316 |
||||||
EARNINGS PER SHARE, BASIC |
$ |
0.47 |
||||||
EARNINGS PER SHARE, DILUTED |
$ |
0.47 |
||||||
Weighted Average Shares (reported and ongoing) - in millions |
||||||||
Basic |
671 |
|||||||
Diluted |
672 |
Spectra Energy Corp | |||||||||||||||
Reported to Ongoing Earnings Reconciliation | |||||||||||||||
December 2014 Year-to-date | |||||||||||||||
(Unaudited) | |||||||||||||||
(In millions, except per-share amounts) | |||||||||||||||
Reported Earnings |
Special Items |
Ongoing Earnings | |||||||||||||
SEGMENT EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND AMORTIZATION |
|||||||||||||||
Spectra Energy Partners |
$ |
1,669 |
$ |
— |
$ |
1,669 |
|||||||||
Distribution |
552 |
— |
552 |
||||||||||||
Western Canada Transmission & Processing |
754 |
— |
754 |
||||||||||||
Field Services |
217 |
12 |
A |
229 |
|||||||||||
Total Reportable Segment EBITDA |
3,192 |
12 |
3,204 |
||||||||||||
Other |
(58) |
— |
(58) |
||||||||||||
Total Reportable Segment and Other EBITDA |
$ |
3,134 |
$ |
12 |
$ |
3,146 |
|||||||||
EARNINGS |
|||||||||||||||
Total Reportable Segment EBITDA and Other EBITDA |
$ |
3,134 |
$ |
12 |
$ |
3,146 |
|||||||||
Depreciation and Amortization |
(796) |
— |
(796) |
||||||||||||
Interest Expense |
(679) |
— |
(679) |
||||||||||||
Interest Income and Other |
6 |
— |
6 |
||||||||||||
Income Tax Expense |
(382) |
(4) |
(386) |
||||||||||||
Total Net Income |
1,283 |
8 |
1,291 |
||||||||||||
Total Net Income - Noncontrolling Interests |
(201) |
— |
(201) |
||||||||||||
Total Net Income - Controlling Interests |
$ |
1,082 |
$ |
8 |
$ |
1,090 |
|||||||||
EARNINGS PER SHARE, BASIC |
$ |
1.61 |
$ |
0.01 |
$ |
1.62 |
|||||||||
EARNINGS PER SHARE, DILUTED |
$ |
1.61 |
$ |
0.01 |
$ |
1.62 |
|||||||||
A - Loss on sales of assets and goodwill impairment. |
|||||||||||||||
Weighted Average Shares (reported and ongoing) - in millions |
|||||||||||||||
Basic |
671 |
||||||||||||||
Diluted |
672 |
Spectra Energy Corp | ||||||||||||||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | ||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||
(In millions, except where noted) | ||||||||||||||||||||||||
Quarter Ended |
Quarter Ended | |||||||||||||||||||||||
Reported |
Special Items |
Ongoing |
Reported |
Special Items |
Ongoing | |||||||||||||||||||
Net Income (Loss) |
$ |
(188) |
$ |
452 |
$ |
264 |
$ |
374 |
$ |
— |
$ |
374 |
||||||||||||
Add: |
||||||||||||||||||||||||
Interest expense |
156 |
— |
156 |
158 |
— |
158 |
||||||||||||||||||
Income tax expense (benefit) |
(3) |
67 |
64 |
77 |
— |
77 |
||||||||||||||||||
Depreciation and amortization |
190 |
— |
190 |
196 |
— |
196 |
||||||||||||||||||
Foreign currency loss (gain) |
(1) |
— |
(1) |
5 |
— |
5 |
||||||||||||||||||
Less: |
||||||||||||||||||||||||
Third Party Interest Income |
1 |
— |
1 |
— |
— |
— |
||||||||||||||||||
EBITDA |
153 |
519 |
672 |
810 |
— |
810 |
||||||||||||||||||
Add: |
||||||||||||||||||||||||
Earnings from equity investments |
4 |
(3) |
1 |
(24) |
— |
(24) |
||||||||||||||||||
Non-cash impairments at DCP |
169 |
(169) |
— |
— |
— |
— |
||||||||||||||||||
Distributions from equity investments |
26 |
— |
26 |
107 |
— |
107 |
||||||||||||||||||
Empress non-cash items |
18 |
— |
18 |
(60) |
— |
(60) |
||||||||||||||||||
Non-cash goodwill impairments associated |
333 |
(333) |
— |
— |
— |
— |
||||||||||||||||||
Other non-cash asset impairments |
7 |
(7) |
— |
— |
— |
— |
||||||||||||||||||
Other |
(5) |
— |
(5) |
(28) |
— |
(28) |
||||||||||||||||||
Less: |
||||||||||||||||||||||||
Interest expense |
156 |
— |
156 |
158 |
— |
158 |
||||||||||||||||||
Equity AFUDC |
38 |
— |
38 |
20 |
— |
20 |
||||||||||||||||||
Net cash paid (refund) for income taxes |
49 |
— |
49 |
(16) |
— |
(16) |
||||||||||||||||||
Distributions to non-controlling interests |
58 |
— |
58 |
47 |
— |
47 |
||||||||||||||||||
Maintenance capital expenditures |
210 |
— |
210 |
280 |
— |
280 |
||||||||||||||||||
Total Distributable Cash Flow |
$ |
194 |
$ |
7 |
$ |
201 |
$ |
316 |
$ |
— |
$ |
316 |
Spectra Energy Corp | ||||||||||||||||||||||||
Reported to Ongoing Distributable Cash Flow Reconciliation | ||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||
(In millions, except where noted) | ||||||||||||||||||||||||
Year Ended |
Year Ended | |||||||||||||||||||||||
Reported |
Special Items |
Ongoing |
Reported |
Special Items |
Ongoing | |||||||||||||||||||
Net Income |
$ |
460 |
$ |
579 |
$ |
1,039 |
$ |
1,283 |
$ |
8 |
$ |
1,291 |
||||||||||||
Add: |
||||||||||||||||||||||||
Interest expense |
636 |
— |
636 |
679 |
— |
679 |
||||||||||||||||||
Income tax expense |
161 |
143 |
304 |
382 |
4 |
386 |
||||||||||||||||||
Depreciation and amortization |
764 |
— |
764 |
796 |
— |
796 |
||||||||||||||||||
Foreign currency loss (gain) |
6 |
— |
6 |
(3) |
— |
(3) |
||||||||||||||||||
Less: |
||||||||||||||||||||||||
Third Party Interest Income |
3 |
— |
3 |
3 |
— |
3 |
||||||||||||||||||
EBITDA |
2,024 |
722 |
2,746 |
3,134 |
12 |
3,146 |
||||||||||||||||||
Add: |
||||||||||||||||||||||||
Earnings from equity investments |
(76) |
11 |
(65) |
(370) |
(3) |
(373) |
||||||||||||||||||
Non-cash impairments at DCP |
366 |
(366) |
— |
9 |
(9) |
— |
||||||||||||||||||
Distributions from equity investments |
209 |
— |
209 |
416 |
— |
416 |
||||||||||||||||||
Empress non-cash items |
42 |
— |
42 |
(60) |
— |
(60) |
||||||||||||||||||
Non-cash goodwill impairments associated |
333 |
(333) |
— |
— |
— |
— |
||||||||||||||||||
Other non-cash asset impairments |
16 |
(16) |
— |
— |
— |
— |
||||||||||||||||||
Other |
25 |
— |
25 |
(19) |
— |
(19) |
||||||||||||||||||
Less: |
||||||||||||||||||||||||
Interest expense |
636 |
— |
636 |
679 |
— |
679 |
||||||||||||||||||
Equity AFUDC |
111 |
— |
111 |
53 |
— |
53 |
||||||||||||||||||
Net cash paid (refund) for income taxes |
29 |
— |
29 |
(8) |
— |
(8) |
||||||||||||||||||
Distributions to non-controlling interests |
198 |
— |
198 |
175 |
— |
175 |
||||||||||||||||||
Maintenance capital expenditures |
691 |
— |
691 |
751 |
— |
751 |
||||||||||||||||||
Total Distributable Cash Flow |
$ |
1,274 |
$ |
18 |
$ |
1,292 |
$ |
1,460 |
$ |
— |
$ |
1,460 |
||||||||||||
Dividends declared |
$ |
1,017 |
$ |
924 |
||||||||||||||||||||
Coverage - DCF / Dividend |
1.3x |
1.6x |
Logo - http://photos.prnewswire.com/prnh/20061030/CLM051LOGO
SOURCE Spectra Energy Corp
HOUSTON, Feb. 3, 2016 /PRNewswire/ -- Spectra Energy Partners, LP (NYSE: SEP) announced that the board of directors of its general partner declared a quarterly cash distribution to unitholders of $0.63875 per unit, an increase of 1.25 cents over the previous level of $0.62625 per unit. This is the 33rd consecutive quarter that Spectra Energy Partners has increased its quarterly cash distribution. The cash distribution is payable on February 26, 2016, to unitholders of record at the close of business on February 15, 2016. This quarterly cash distribution equates to $2.555 per unit on an annual basis.
This information is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Under rules applicable to publicly-traded partnerships, our distributions to non-U.S. unitholders are subject to withholding tax at the highest effective applicable rate to the extent attributable to income that is effectively connected with the conduct of a U.S. trade or business. Given the uncertainty at the time of making distributions regarding the amount of any distribution that is attributable to income that is so effectively connected, we intend to treat all of our distributions as attributable to our U.S. operations, and as a result, the entire distribution will be subject to withholding.
Spectra Energy Partners, LP (NYSE: SEP) is a Houston-based master limited partnership, formed by Spectra Energy Corp (NYSE: SE). SEP is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.
Logo - http://photos.prnewswire.com/prnh/20071107/CLW064
SOURCE Spectra Energy Partners, LP
HOUSTON, Jan. 7, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) and Spectra Energy Partners (NYSE: SEP) will announce their fourth quarter 2015 earnings results before the market opens on Wednesday, February 3, 2016, and will hold a joint investor and analyst conference call at 8 a.m. CT that same day.
The webcast will be available via the Investors sections of the Spectra Energy and Spectra Energy Partners websites. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 89326071 or "Spectra Energy / Spectra Energy Partners Earnings Call."
A replay of the call will be available until 5 p.m. CT on Tuesday, May 3, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Investors sections of the Spectra Energy and Spectra Energy Partners websites.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com and www.spectraenergypartners.com.
Logo - http://photos.prnewswire.com/prnh/20061030/CLM051LOGO
Logo - http://photos.prnewswire.com/prnh/20071107/CLW064
SOURCE Spectra Energy Corp; Spectra Energy Partners
HOUSTON, Jan. 6, 2016 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) and Spectra Energy Partners (NYSE: SEP) will discuss their business outlook and financial plan during an analyst/investor meeting on Thursday, February 4, 2016.
Chief Executive Officer Greg Ebel, Chief Financial Officer Pat Reddy, and other executive leaders will deliver remarks and then address audience questions.
The presentation is scheduled to begin at 8:30 a.m. ET and will be webcast via the Investors sections of the Spectra Energy and Spectra Energy Partners websites. The conference call can be accessed by dialing (888) 252-3715 in the U.S. or Canada, or (706) 634-8942 internationally. The conference ID is 7888893 or "Spectra Energy 2016 Plan."
A replay of the call will be available until 5 p.m. CT on Tuesday, May 3, 2016, by dialing (800) 585-8367 in the U.S. or Canada, or (404) 537-3406 internationally, and using the above conference ID. A replay and transcript also will be available via the Investors sections of the Spectra Energy and Spectra Energy Partners websites.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's leading pipeline and midstream companies. Based in Houston, Texas, the company's operations in the United States and Canada include more than 21,000 miles of natural gas, natural gas liquids, and crude oil pipelines; approximately 300 billion cubic feet (Bcf) of natural gas storage; 4.8 million barrels of crude oil storage; as well as natural gas gathering, processing, and local distribution operations. Spectra Energy is the general partner of Spectra Energy Partners (NYSE: SEP), one of the largest pipeline master limited partnerships in the United States and owner of the natural gas and crude oil assets in Spectra Energy's U.S. portfolio. Spectra Energy also has a 50 percent ownership in DCP Midstream, the largest producer of natural gas liquids and the largest natural gas processor in the United States. Spectra Energy has served North American customers and communities for more than a century. For more information, visit www.spectraenergy.com and www.spectraenergypartners.com.
Logo - http://photos.prnewswire.com/prnh/20061030/CLM051LOGO
Logo - http://photos.prnewswire.com/prnh/20071107/CLW064
SOURCE Spectra Energy Corp; Spectra Energy Partners, LP
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