Enterprise Products Partners (NYSE: EPD) reported Q3 EPS of $0.46, $0.07 worse than the analyst estimate of $0.53. Revenue for the quarter came in at $7.95 billion versus the consensus estimate of $8.82 billion.

• Net income for the third quarter of 2019 included unrealized mark-to-market losses of $86 million, or a loss of $0.04 per fully diluted unit, primarily related to activities to hedge interest rates for future issuances of debt. Net income for the third quarter of 2018 included unrealized mark-to-market gains of $204 million, or a gain of $0.09 per fully diluted unit, primarily from hedging activities related to our Midland-to-ECHO 1 crude oil pipeline. In addition, net income for the third quarter of 2019 also included non-cash, asset impairment and related charges of $39 million, or a loss of $0.02 per fully diluted unit.
• Enterprise increased its cash distribution with respect to the third quarter of 2019 by 2.3 percent to $0.4425 per unit compared to the distribution paid for the third quarter of 2018. The distribution will be paid November 12, 2019 to unitholders of record as of the close of business on October 31, 2019.
• CFFO increased 4 percent to $1.6 billion for the third quarter of 2019 compared to the third quarter of 2018. The distribution with respect to the third quarter of 2019 represents a 59 percent payout ratio of CFFO for the third quarter of 2019. FCF for the third quarter of 2019 increased 115 percent to $1.0 billion from $477 million in the third quarter of 2018, primarily as a result of the initial contribution of $441 million for a noncontrolling interest in the Shin Oak NGL pipeline. FCF for the 12-month period ending September 30, 2019, increased 28 percent to $2.7 billion compared to $2.1 billion reported for the comparable period ending September 30, 2018.
• Enterprise reported DCF of $1.6 billion for the third quarter of 2019, which provided 1.7 times coverage of the $0.4425 per unit cash distribution and resulted in $665 million of retained DCF. DCF for the first nine months of 2019 was $5.0 billion, which also provided 1.7 times coverage of the aggregate $1.32 per unit of cash distributions for that period and resulted in $2.1 billion of retained DCF. Retained DCF is available to reinvest in growth capital projects and reduces our need to issue additional equity.

“The third quarter of 2019 was another strong quarter for Enterprise and reflected the quality of our fee based businesses,” stated A. J. “Jim” Teague, chief executive officer of Enterprise’s general partner. “We reported a four percent increase in cash flow from operations to $1.6 billion compared to the same quarter in 2018. Contributions from our fee-based businesses more than offset lower cash flow from our natural gas processing business due to lower NGL prices and our NGL and crude oil marketing businesses due to a decrease in regional price spreads. We benefited from cash flows generated by new assets going into service over the past year as well as volume growth on certain assets. During the quarter, the partnership set six operational records including total equivalent pipeline volumes, natural gas pipeline volumes, NGL fractionation volumes, crude oil marine terminal volumes and propylene production volumes.”

“The third quarter was also very successful in terms of underwriting new growth projects. We were successful in sanctioning two expansions of our Midland-to-ECHO crude oil pipeline system and our second propane dehydrogenation facility. In total, we now have $9.1 billion of growth capital projects under construction. These projects are scheduled to begin service between now and the end of 2023. Approximately $3.0 billion of growth capital projects are expected to be completed and begin commissioning over the next six months, including our isobutane dehydrogenation facility and 10th NGL fractionator in the Mont Belvieu area, the ethylene export marine terminal on the Houston Ship Channel and two natural gas processing plants. These projects should enable us to continue to increase our cash flow per unit while maintaining our strong balance sheet,” concluded Teague.

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