Why Enterprise Products’ revenues and net profit were up in 3Q14

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Nov. 27 2019, Updated 3:22 p.m. ET

Revenues and net profit increase

In the last part of this series, we discussed Enterprise Products Partners’ (EPD) earnings versus analysts’ estimates. In this part of the series, we’ll analyze the company’s revenues and earnings. We’ll discuss why the revenues and earnings moved compared to the same period last year.

Quarterly revenues

Revenues up in 3Q14

EPD’s revenues for 3Q14 went up 2% to $12.33 billion—from $12.09 billion. It was mainly due to a 2% increase in natural gas liquid (or NGL), crude oil, refined products, and petrochemical pipeline volumes for 3Q14. It increased to a record 5.2 million barrels per day—compared to 3Q13.

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Among its peers, revenues for Kinder Morgan Energy Partners (KMP) increased 16.3%. Revenues for Plains All American (PAA) increased by 4%. Williams Companies’ (WMB) revenues increased by 27.5% in 3Q14—compared to the same period last year. Some of these companies are part of the Alerian MLP ETF (AMLP).

Operating profit quarterly

Operating income and margin up

For 3Q14, EPD recorded $937.7 million in operating income—up 14% from $819.9 million recorded in 3Q13. In 3Q14, EPD’s operating income improved in all of its segments, except for the Onshore Natural Gas Pipelines & Services segment. We’ll discuss this in the next part of the series.

EPD’s operating profit margin—or operating profit as percentage of total revenues—also inflated to 7.6% in 3Q14 from 6.8% in the same quarter last year. Along with the revenue increase, EPD was also able to improve operating income and margin in its latest quarter.

The main reasons for the improvements were:

  • Fee-based natural gas processing volumes
  • NGL fractionation volumes
  • Higher cash flows from new assets in place

Diluted earnings were $0.37 per unit in 3Q14—compared to $0.32 per unit in 3Q13.

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