Why 3Q17 Was Good for MLPs



Earnings in 3Q17

Most MLPs have reported their 3Q17 results. The third quarter has been good for most publicly traded partnerships. Of the top 20 limited partnerships by market capitalization, 15 reported YoY (year-over-year) growth in quarterly revenue, while 16 reported growth in their quarterly EBITDA (earnings before interest, tax, depreciation, and amortization)—12 of which reported QoQ (quarter-over-quarter) growth in revenue, and 13 reported QoQ growth in adjusted EBITDA. MPLX LP (MPLX) reported the highest YoY EBITDA growth among the selected MLPs. For a post-earnings results analysis of MPLX, read MPLX Posted Strong 3Q17 Results, Distributions Rose 4%.

In this series, we’ll review 3Q17 earnings results for some mid-to-large cap limited partnerships. We’ll start by summarizing the 3Q17 performance of four large-cap MLPs.

Enterprise Product Partners

Enterprise Product Partners (EPD), the largest US MLP by market capitalization, posted 16.3% YoY revenue growth and 4.9% YoY EBITDA growth in the recent quarter. However, EPD’s quarterly EBITDA margin shrank 208 basis points YoY to 19.2%. For a post-earnings results review of EPD, read Behind Enterprise Products Partners’ 3Q17 Results.

Williams Partners

Williams Partners (WPZ), Williams Companies’ (WMB) MLP subsidiary, reported a fall of 1.2% and 7.4% in its revenue and EBITDA, respectively, in 3Q17. Moreover, WPZ’s EBITDA margin shrank by 394 basis points YoY to 58.4%. For a look at WPZ’s 3Q17 performance drivers, read Analyzing Williams Companies and Williams Partners’ 3Q17 Results.

Energy Transfer Partners

Energy Transfer Partners (ETP), Energy Transfer Equity’s (ETE) MLP subsidiary, posted strong 3Q17 earnings. The Texas-based partnership reported 26.1% and 25.5% YoY revenue and EBITDA growth in 3Q17. However, the partnership’s EBITDA margin remained the same during the quarter. For details on ETP’s 3Q17 performance, read Analyzing ETE’s and ETP’s 3Q17 Earnings.

Magellan Midstream Partners

Magellan Midstream Partners (MMP), one of the largest US refined product transporters, saw 3.5% and 0.5% YoY revenue and EBITDA growth, respectively, in the third quarter. MMP’s EBITDA margin expanded by 137 basis points in the third quarter. For a post-earnings results analysis of MMP’s 3Q17 earnings, read Magellan Reaffirmed Its Distribution Growth for 2017 and 2018.

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