Plains All American Pipeline, L.P. (Nasdaq: PAA) and Plains GP
Holdings (Nasdaq: PAGP) today reported first-quarter 2024 results
and reaffirmed full-year 2024 Adjusted EBITDA guidance. Plains also
provided updates on Permian long-haul contracting and announced two
bolt-on acquisitions.
First-Quarter Results
- Reported Net income attributable to PAA of $266 million and Net
cash provided by operating activities of $419 million
- Delivered Adjusted EBITDA attributable to PAA of $718 million;
on-track to meet full-year guidance of $2.625 - $2.725 billion
- Generated Adjusted Free Cash Flow of $262 million (excluding
changes in Assets & Liabilities; including bolt-on acquisition
capital)
- Increased annualized common distribution by $0.20 to $1.27 per
unit (~19% increase, paid in February)
Permian Long-Haul Contracting Update
- Increased contracted volumes and
extended the term of certain contracts such that the weighted
average contract duration of our Permian long-haul portfolio is
approximately 5-years, through 2028, including new contracts or
extensions on Cactus I, Cactus II and Basin/Sunrise
- Expect underlying growth in the
business and contributions from efficient growth investments to
offset lower contracted rates resulting in broadly flat Adj. EBITDA
in 2026 as compared to 2024 guidance for the Crude Oil segment
Bolt-on Acquisitions
- Plains acquired an additional 10%
interest in Saddlehorn Pipeline Company and a Mid-Con terminal
asset for aggregate cash consideration of approximately $110
million enhancing Plains’ position in the Rockies and Mid-Con
“This marks a solid start to the year as we are
on-track to deliver against our full-year plan and our bolt-on
M&A strategy continues to prove successful with complementary
transactions enhancing our footprint in the Rockies and Mid-Con,”
said Willie Chiang, Chairman and CEO of Plains. “Separately, we
successfully extended the duration of our Permian long-haul
portfolio, including Cactus I. This represents a major milestone
and provides greater clarity on the outlook for our long-haul
assets. Better visibility around re-contracting combined with our
disciplined operational and financial performance should provide
investors with greater confidence in the outlook for the business
and our ability to continue generating significant free cash flow
for years to come.”
Plains All American Pipeline
Summary Financial Information (unaudited)(in
millions, except per unit data)
|
|
Three Months EndedMarch 31, |
|
% |
GAAP Results |
|
2024 |
|
2023 |
|
Change |
Net income attributable to PAA |
|
$ |
266 |
|
$ |
422 |
|
(37 |
)% |
Diluted net income per common
unit |
|
$ |
0.29 |
|
$ |
0.52 |
|
(44 |
)% |
Diluted weighted average
common units outstanding |
|
|
701 |
|
|
698 |
|
— |
% |
Net cash provided by operating
activities |
|
$ |
419 |
|
$ |
743 |
|
(44 |
)% |
Distribution per common unit
declared for the period |
|
$ |
0.3175 |
|
$ |
0.2675 |
|
19 |
% |
|
|
Three Months EndedMarch 31, |
|
% |
Non-GAAP Results (1) |
|
2024 |
|
|
2023 |
|
Change |
Adjusted net income attributable to PAA |
|
$ |
354 |
|
|
$ |
344 |
|
3 |
% |
Diluted adjusted net income
per common unit |
|
$ |
0.41 |
|
|
$ |
0.41 |
|
— |
% |
Adjusted EBITDA |
|
$ |
847 |
|
|
$ |
813 |
|
4 |
% |
Adjusted EBITDA attributable
to PAA (2) |
|
$ |
718 |
|
|
$ |
715 |
|
— |
% |
Implied DCF per common unit
and common unit equivalent |
|
$ |
0.67 |
|
|
$ |
0.62 |
|
8 |
% |
Adjusted Free Cash Flow |
|
$ |
70 |
|
|
$ |
823 |
|
(91 |
)% |
Adjusted Free Cash Flow after
Distributions |
|
$ |
(217 |
) |
|
$ |
581 |
|
** |
|
Adjusted Free Cash Flow
(Excluding Changes in Assets & Liabilities) |
|
$ |
262 |
|
|
$ |
625 |
|
(58 |
)% |
Adjusted Free Cash Flow after
Distributions (Excluding Changes in Assets & Liabilities) |
|
$ |
(25 |
) |
|
$ |
383 |
|
** |
|
** Indicates that variance as a
percentage is not meaningful.
(1) |
|
See the section of this release
entitled “Non-GAAP Financial Measures and Selected Items Impacting
Comparability” and the tables attached hereto for information
regarding our Non-GAAP financial measures, including their
reconciliation to the most directly comparable measures as reported
in accordance with GAAP, and certain selected items that PAA
believes impact comparability of financial results between
reporting periods. |
(2) |
|
Excludes amounts attributable to
noncontrolling interests in the Plains Oryx Permian Basin LLC joint
venture, Cactus II Pipeline LLC and Red River Pipeline LLC. |
|
|
|
Summary of Selected Financial Data by Segment
(unaudited)(in millions)
|
Segment Adjusted EBITDA |
|
Crude Oil |
|
NGL |
Three Months Ended March 31, 2024 |
$ |
553 |
|
|
$ |
159 |
|
Three Months Ended March 31,
2023 |
$ |
517 |
|
|
$ |
192 |
|
Percentage change in
Segment Adjusted EBITDA versus 2023
period |
|
7 |
% |
|
|
(17 |
)% |
First-quarter 2024 Crude Oil Segment Adjusted
EBITDA increased 7% versus comparable 2023 results primarily due to
higher tariff volumes on our pipelines, tariff escalations and
contributions from acquisitions. These items were partially offset
by fewer market based opportunities.
First-quarter 2024 NGL Segment Adjusted EBITDA
decreased 17% versus comparable 2023 results primarily due to lower
realized frac spreads.
Plains GP Holdings
PAGP owns an indirect non-economic controlling
interest in PAA’s general partner and an indirect limited partner
interest in PAA. As the control entity of PAA, PAGP consolidates
PAA’s results into its financial statements, which is reflected in
the condensed consolidating balance sheet and income statement
tables attached hereto.
Conference Call and Webcast
Instructions
PAA and PAGP will hold a joint conference call
at 9:00 a.m. CT on Friday, May 3, 2024 to discuss first-quarter
performance and related items.
To access the internet webcast, please go to
https://edge.media-server.com/mmc/p/cr79phyy/
Alternatively, the webcast can be accessed on
our website (www.plains.com) under Investor Relations (Navigate to:
Investor Relations / either “PAA” or “PAGP” / News & Events /
Events & Presentations). Following the live webcast, an audio
replay will be available on our website and will be accessible for
a period of 365 days. Slides will be posted prior to the call at
the above referenced website.
Non-GAAP Financial Measures and Selected
Items Impacting Comparability
To supplement our financial information
presented in accordance with GAAP, management uses additional
measures known as “non-GAAP financial measures” in its evaluation
of past performance and prospects for the future and to assess the
amount of cash that is available for distributions, debt
repayments, common equity repurchases and other general partnership
purposes. The primary additional measures used by management are
Adjusted EBITDA, Adjusted EBITDA attributable to PAA, Implied
Distributable Cash Flow (“DCF”), Adjusted Free Cash Flow and
Adjusted Free Cash Flow after Distributions.
Our definition and calculation of certain
non-GAAP financial measures may not be comparable to
similarly-titled measures of other companies. Adjusted
EBITDA, Adjusted EBITDA attributable to PAA, Implied DCF and
certain other non-GAAP financial performance measures are
reconciled to Net Income, and Adjusted Free Cash Flow, Adjusted
Free Cash Flow after Distributions and certain other non-GAAP
financial liquidity measures are reconciled to Net Cash Provided by
Operating Activities (the most directly comparable measures
as reported in accordance with GAAP) for the historical
periods presented in the tables attached to this release, and
should be viewed in addition to, and not in lieu of, our
Consolidated Financial Statements and accompanying notes. In
addition, we encourage you to visit our website at www.plains.com
(in particular the section under “Financial Information” entitled
“Non-GAAP Reconciliations” within the Investor Relations tab),
which presents a reconciliation of our commonly used non-GAAP and
supplemental financial measures. We do not reconcile non-GAAP
financial measures on a forward-looking basis as it is impractical
to do so without unreasonable effort.
Non-GAAP Financial Performance Measures
Adjusted EBITDA is defined as earnings before
interest expense, income tax (expense)/benefit, depreciation and
amortization (including our proportionate share of depreciation and
amortization, including write-downs related to cancelled projects
and impairments, of unconsolidated entities), gains and losses on
asset sales and asset impairments and gains or losses on
investments in unconsolidated entities, adjusted for certain
selected items impacting comparability. Adjusted EBITDA
attributable to PAA excludes the portion of Adjusted EBITDA that is
attributable to noncontrolling interests.
Management believes that the presentation of
Adjusted EBITDA, Adjusted EBITDA attributable to PAA and Implied
DCF provides useful information to investors regarding our
performance and results of operations because these measures, when
used to supplement related GAAP financial measures, (i) provide
additional information about our core operating performance and
ability to fund distributions to our unitholders through cash
generated by our operations and (ii) provide investors with the
same financial analytical framework upon which management bases
financial, operational, compensation and planning/budgeting
decisions. We also present these and additional non-GAAP financial
measures, including adjusted net income attributable to PAA and
basic and diluted adjusted net income per common unit, as they are
measures that investors, rating agencies and debt holders have
indicated are useful in assessing us and our results of operations.
These non-GAAP financial performance measures may exclude, for
example, (i) charges for obligations that are expected to be
settled with the issuance of equity instruments, (ii) gains and
losses on derivative instruments that are related to underlying
activities in another period (or the reversal of such adjustments
from a prior period), gains and losses on derivatives that are
either related to investing activities (such as the purchase of
linefill) or purchases of long-term inventory, and inventory
valuation adjustments, as applicable, (iii) long-term inventory
costing adjustments, (iv) items that are not indicative of our core
operating results and/or (v) other items that we believe should be
excluded in understanding our core operating performance. These
measures may be further adjusted to include amounts related to
deficiencies associated with minimum volume commitments whereby we
have billed the counterparties for their deficiency obligation and
such amounts are recognized as deferred revenue in “Other current
liabilities” in our Condensed Consolidated Financial Statements. We
also adjust for amounts billed by our equity method investees
related to deficiencies under minimum volume commitments. Such
amounts are presented net of applicable amounts subsequently
recognized into revenue. Furthermore, the calculation of these
measures contemplates tax effects as a separate reconciling item,
where applicable. We have defined all such items as “selected items
impacting comparability.” Due to the nature of the selected items,
certain selected items impacting comparability may impact certain
non-GAAP financial measures, referred to as adjusted results, but
not impact other non-GAAP financial measures. We do not necessarily
consider all of our selected items impacting comparability to be
non-recurring, infrequent or unusual, but we believe that an
understanding of these selected items impacting comparability is
material to the evaluation of our operating results and
prospects.
Although we present selected items impacting
comparability that management considers in evaluating our
performance, you should also be aware that the items presented do
not represent all items that affect comparability between the
periods presented. Variations in our operating results are also
caused by changes in volumes, prices, exchange rates, mechanical
interruptions, acquisitions, divestitures, investment capital
projects and numerous other factors. These types of variations may
not be separately identified in this release, but will be
discussed, as applicable, in management’s discussion and analysis
of operating results in our Quarterly Report on Form 10-Q.
Non-GAAP Financial Liquidity
Measures
Management uses the non-GAAP financial liquidity
measures Adjusted Free Cash Flow and Adjusted Free Cash Flow after
Distributions to assess the amount of cash that is available for
distributions, debt repayments, common equity repurchases and other
general partnership purposes. Adjusted Free Cash Flow is defined as
Net Cash Provided by Operating Activities, less Net Cash Provided
by/(Used in) Investing Activities, which primarily includes
acquisition, investment and maintenance capital expenditures,
investments in unconsolidated entities and the impact from the
purchase and sale of linefill, net of proceeds from the sales of
assets and further impacted by distributions to and contributions
from noncontrolling interests. Adjusted Free Cash Flow is further
reduced by cash distributions paid to our preferred and common
unitholders to arrive at Adjusted Free Cash Flow after
Distributions.
We also present these measures and additional
non-GAAP financial liquidity measures as they are measures that
investors have indicated are useful. We present the Adjusted Free
Cash Flow (Excluding Changes in Assets & Liabilities) for use
in assessing our underlying business liquidity and cash flow
generating capacity excluding fluctuations caused by timing of when
amounts earned or incurred were collected, received or paid from
period to period. Adjusted Free Cash Flow (Excluding Changes in
Assets & Liabilities) is defined as Adjusted Free Cash Flow
excluding the impact of “Changes in assets and liabilities, net of
acquisitions” on our Condensed Consolidated Statements of Cash
Flows. Adjusted Free Cash Flow (Excluding Changes in Assets &
Liabilities) is further reduced by cash distributions paid to our
preferred and common unitholders to arrive at Adjusted Free Cash
Flow after Distributions (Excluding Changes in Assets &
Liabilities).
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(in millions, except per unit data)
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
REVENUES |
$ |
11,995 |
|
|
$ |
12,341 |
|
|
|
|
|
COSTS AND
EXPENSES |
|
|
|
Purchases and related
costs |
|
10,917 |
|
|
|
11,323 |
|
Field operating costs |
|
358 |
|
|
|
357 |
|
General and administrative
expenses |
|
96 |
|
|
|
86 |
|
Depreciation and
amortization |
|
254 |
|
|
|
256 |
|
(Gains)/losses on asset sales,
net |
|
— |
|
|
|
(154 |
) |
Total costs and expenses |
|
11,625 |
|
|
|
11,868 |
|
|
|
|
|
OPERATING
INCOME |
|
370 |
|
|
|
473 |
|
|
|
|
|
OTHER
INCOME/(EXPENSE) |
|
|
|
Equity earnings in
unconsolidated entities |
|
95 |
|
|
|
89 |
|
Interest expense, net |
|
(95 |
) |
|
|
(98 |
) |
Other income/(expense),
net |
|
(5 |
) |
|
|
64 |
|
|
|
|
|
INCOME BEFORE
TAX |
|
365 |
|
|
|
528 |
|
Current income tax
expense |
|
(53 |
) |
|
|
(61 |
) |
Deferred income tax
benefit |
|
39 |
|
|
|
8 |
|
|
|
|
|
NET
INCOME |
|
351 |
|
|
|
475 |
|
Net income attributable to noncontrolling interests |
|
(85 |
) |
|
|
(53 |
) |
NET INCOME
ATTRIBUTABLE TO PAA |
$ |
266 |
|
|
$ |
422 |
|
|
|
|
|
NET INCOME PER COMMON
UNIT: |
|
|
|
Net income allocated to common unitholders — Basic and Diluted |
$ |
203 |
|
|
$ |
361 |
|
Basic and diluted weighted average common units outstanding |
|
701 |
|
|
|
698 |
|
Basic and diluted net income per common unit |
$ |
0.29 |
|
|
$ |
0.52 |
|
|
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
CONDENSED CONSOLIDATED BALANCE SHEET DATA(in
millions)
|
March 31,2024 |
|
December 31,2023 |
ASSETS |
|
|
|
Current assets (including Cash and cash equivalents of $331 and
$450, respectively) |
$ |
5,001 |
|
$ |
4,913 |
Property and equipment,
net |
|
15,671 |
|
|
15,782 |
Investments in unconsolidated
entities |
|
2,878 |
|
|
2,820 |
Intangible assets, net |
|
1,807 |
|
|
1,875 |
Linefill |
|
981 |
|
|
976 |
Long-term operating lease
right-of-use assets, net |
|
298 |
|
|
313 |
Long-term inventory |
|
299 |
|
|
265 |
Other long-term assets,
net |
|
421 |
|
|
411 |
Total assets |
$ |
27,356 |
|
$ |
27,355 |
|
|
|
|
LIABILITIES AND
PARTNERS’ CAPITAL |
|
|
|
Current liabilities |
$ |
5,144 |
|
$ |
5,003 |
Senior notes, net |
|
7,244 |
|
|
7,242 |
Other long-term debt, net |
|
64 |
|
|
63 |
Long-term operating lease
liabilities |
|
261 |
|
|
274 |
Other long-term liabilities
and deferred credits |
|
997 |
|
|
1,041 |
Total liabilities |
|
13,710 |
|
|
13,623 |
|
|
|
|
Partners’ capital excluding
noncontrolling interests |
|
10,339 |
|
|
10,422 |
Noncontrolling interests |
|
3,307 |
|
|
3,310 |
Total partners’ capital |
|
13,646 |
|
|
13,732 |
Total liabilities and partners’ capital |
$ |
27,356 |
|
$ |
27,355 |
DEBT CAPITALIZATION RATIOS(in millions)
|
March 31,2024 |
|
December 31,2023 |
Short-term debt |
$ |
554 |
|
|
$ |
446 |
|
Long-term debt |
|
7,308 |
|
|
|
7,305 |
|
Total debt |
$ |
7,862 |
|
|
$ |
7,751 |
|
|
|
|
|
Long-term debt |
$ |
7,308 |
|
|
$ |
7,305 |
|
Partners’ capital excluding
noncontrolling interests |
|
10,339 |
|
|
|
10,422 |
|
Total book capitalization excluding noncontrolling interests
(“Total book capitalization”) |
$ |
17,647 |
|
|
$ |
17,727 |
|
Total book capitalization, including short-term debt |
$ |
18,201 |
|
|
$ |
18,173 |
|
|
|
|
|
Long-term debt-to-total book
capitalization |
|
41 |
% |
|
|
41 |
% |
Total debt-to-total book
capitalization, including short-term debt |
|
43 |
% |
|
|
43 |
% |
|
|
|
|
|
|
|
|
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
COMPUTATION OF BASIC AND DILUTED NET INCOME PER COMMON
UNIT (1)(in millions, except per unit
data)
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
Basic and Diluted Net
Income per Common Unit |
|
|
|
Net income attributable to PAA |
$ |
266 |
|
|
$ |
422 |
|
Distributions to Series A preferred unitholders |
|
(44 |
) |
|
|
(42 |
) |
Distributions to Series B preferred unitholders |
|
(19 |
) |
|
|
(18 |
) |
Amounts allocated to participating securities |
|
(1 |
) |
|
|
(2 |
) |
Other |
|
1 |
|
|
|
1 |
|
Net income allocated to common
unitholders |
$ |
203 |
|
|
$ |
361 |
|
|
|
|
|
Basic and diluted weighted
average common units outstanding (2) (3) |
|
701 |
|
|
|
698 |
|
|
|
|
|
Basic and diluted net income
per common unit |
$ |
0.29 |
|
|
$ |
0.52 |
|
(1) |
|
We calculate net income allocated to common unitholders based on
the distributions pertaining to the current period’s net income.
After adjusting for the appropriate period’s distributions, the
remaining undistributed earnings or excess distributions over
earnings, if any, are allocated to common unitholders and
participating securities in accordance with the contractual terms
of our partnership agreement in effect for the period and as
further prescribed under the two-class method. |
(2) |
|
The possible conversion of our Series A preferred units was
excluded from the calculation of diluted net income per common unit
for each of the three months ended March 31, 2024 and 2023 as the
effect was antidilutive. |
(3) |
|
Our equity-indexed compensation plan awards that contemplate the
issuance of common units are considered dilutive unless (i) they
become vested only upon the satisfaction of a performance condition
and (ii) that performance condition has yet to be satisfied.
Equity-indexed compensation plan awards that are deemed to be
dilutive are reduced by a hypothetical common unit repurchase based
on the remaining unamortized fair value, as prescribed by the
treasury stock method in guidance issued by the FASB. |
|
|
|
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
CONDENSED CONSOLIDATED CASH FLOW DATA(in
millions)
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
CASH FLOWS FROM
OPERATING ACTIVITIES |
|
|
|
Net income |
$ |
351 |
|
|
$ |
475 |
|
Reconciliation of net income
to net cash provided by operating activities: |
|
|
|
Depreciation and amortization |
|
254 |
|
|
|
256 |
|
(Gains)/losses on asset sales, net |
|
— |
|
|
|
(154 |
) |
Deferred income tax benefit |
|
(39 |
) |
|
|
(8 |
) |
Equity earnings in unconsolidated entities |
|
(95 |
) |
|
|
(89 |
) |
Distributions on earnings from unconsolidated entities |
|
132 |
|
|
|
108 |
|
Other |
|
8 |
|
|
|
(43 |
) |
Changes in assets and liabilities, net of acquisitions |
|
(192 |
) |
|
|
198 |
|
Net cash provided by operating activities |
|
419 |
|
|
|
743 |
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES |
|
|
|
Net cash provided by/(used in) investing activities |
|
(261 |
) |
|
|
158 |
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES |
|
|
|
Net cash used in financing activities |
|
(273 |
) |
|
|
(776 |
) |
|
|
|
|
Effect of translation adjustment |
|
(4 |
) |
|
|
— |
|
|
|
|
|
Net increase/(decrease) in
cash and cash equivalents and restricted cash |
|
(119 |
) |
|
|
125 |
|
|
|
|
|
Cash and cash equivalents and
restricted cash, beginning of period |
|
450 |
|
|
|
401 |
|
Cash and cash equivalents and
restricted cash, end of period |
$ |
331 |
|
|
$ |
526 |
|
CAPITAL EXPENDITURES(in millions)
|
Net to PAA (1) |
|
Consolidated |
|
Three Months EndedMarch 31, |
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
Investment capital
expenditures: |
|
|
|
|
|
|
|
Crude Oil |
$ |
65 |
|
$ |
50 |
|
$ |
90 |
|
$ |
72 |
NGL |
|
14 |
|
|
8 |
|
|
14 |
|
|
8 |
Total Investment capital
expenditures |
|
79 |
|
|
58 |
|
|
104 |
|
|
80 |
Maintenance capital
expenditures |
|
53 |
|
|
45 |
|
|
57 |
|
|
48 |
|
$ |
132 |
|
$ |
103 |
|
$ |
161 |
|
$ |
128 |
(1) Excludes expenditures attributable to noncontrolling
interests.
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
NON-GAAP RECONCILIATIONS(in millions, except
per unit and ratio data)
Computation of Basic and Diluted Adjusted Net Income Per
Common Unit (1) :
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
Basic and Diluted
Adjusted Net Income per Common Unit |
|
|
|
Net income attributable to PAA |
$ |
266 |
|
|
$ |
422 |
|
Selected items impacting comparability - Adjusted net income
attributable to PAA (2) |
|
88 |
|
|
|
(78 |
) |
Adjusted net income
attributable to PAA |
$ |
354 |
|
|
$ |
344 |
|
Distributions to Series A preferred unitholders |
|
(44 |
) |
|
|
(42 |
) |
Distributions to Series B preferred unitholders |
|
(19 |
) |
|
|
(18 |
) |
Amounts allocated to participating securities |
|
(2 |
) |
|
|
(2 |
) |
Other |
|
1 |
|
|
|
1 |
|
Adjusted net income allocated
to common unitholders |
$ |
290 |
|
|
$ |
283 |
|
|
|
|
|
Basic and diluted weighted
average common units outstanding (3) (4) |
|
701 |
|
|
|
698 |
|
|
|
|
|
Basic and diluted adjusted net
income per common unit |
$ |
0.41 |
|
|
$ |
0.41 |
|
|
|
|
|
(1) |
|
We calculate adjusted net income allocated to common unitholders
based on the distributions pertaining to the current period’s net
income. After adjusting for the appropriate period’s distributions,
the remaining undistributed earnings or excess distributions over
earnings, if any, are allocated to the common unitholders and
participating securities in accordance with the contractual terms
of our partnership agreement in effect for the period and as
further prescribed under the two-class method. |
(2) |
|
See the “Selected Items Impacting Comparability” table for
additional information. |
(3) |
|
The possible conversion of our Series A preferred units was
excluded from the calculation of diluted adjusted net income per
common unit for the three months ended March 31, 2024 and 2023 as
the effect was antidilutive. |
(4) |
|
Our equity-indexed compensation plan awards that contemplate the
issuance of common units are considered dilutive unless (i) they
become vested only upon the satisfaction of a performance condition
and (ii) that performance condition has yet to be satisfied.
Equity-indexed compensation plan awards that are deemed to be
dilutive are reduced by a hypothetical common unit repurchase based
on the remaining unamortized fair value, as prescribed by the
treasury stock method in guidance issued by the FASB. |
|
|
|
Net Income Per Common Unit to Adjusted Net Income Per
Common Unit Reconciliation:
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
Basic and diluted net income per common unit |
$ |
0.29 |
|
$ |
0.52 |
|
Selected items impacting
comparability per common unit (1) |
|
0.12 |
|
|
(0.11 |
) |
Basic and diluted adjusted net
income per common unit |
$ |
0.41 |
|
$ |
0.41 |
|
(1) See the “Selected Items Impacting
Comparability” and the “Computation of Basic and Diluted Adjusted
Net Income Per Common Unit” tables for additional information.
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
Net Income to Adjusted EBITDA attributable to PAA and
Implied DCF Reconciliation:
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
Net income |
$ |
351 |
|
|
$ |
475 |
|
Interest expense, net |
|
95 |
|
|
|
98 |
|
Income tax expense |
|
14 |
|
|
|
53 |
|
Depreciation and amortization |
|
254 |
|
|
|
256 |
|
(Gains)/losses on asset sales, net |
|
— |
|
|
|
(154 |
) |
Depreciation and amortization of unconsolidated entities (1) |
|
19 |
|
|
|
22 |
|
Selected items impacting comparability - Adjusted EBITDA (2) |
|
114 |
|
|
|
63 |
|
Adjusted EBITDA |
$ |
847 |
|
|
$ |
813 |
|
Adjusted EBITDA attributable to noncontrolling interests |
|
(129 |
) |
|
|
(98 |
) |
Adjusted EBITDA attributable
to PAA |
$ |
718 |
|
|
$ |
715 |
|
|
|
|
|
Adjusted EBITDA |
$ |
847 |
|
|
$ |
813 |
|
Interest expense, net of certain non-cash items (3) |
|
(90 |
) |
|
|
(93 |
) |
Maintenance capital |
|
(57 |
) |
|
|
(48 |
) |
Investment capital of noncontrolling interests (4) |
|
(25 |
) |
|
|
(23 |
) |
Current income tax expense |
|
(53 |
) |
|
|
(61 |
) |
Distributions from unconsolidated entities in excess of/(less than)
adjusted equity earnings (5) |
|
12 |
|
|
|
(12 |
) |
Distributions to noncontrolling interests (6) |
|
(100 |
) |
|
|
(78 |
) |
Implied DCF |
$ |
534 |
|
|
$ |
498 |
|
Preferred unit distributions paid (6) |
|
(64 |
) |
|
|
(55 |
) |
Implied DCF Available to
Common Unitholders |
$ |
470 |
|
|
$ |
443 |
|
|
|
|
|
Weighted Average Common Units
Outstanding |
|
701 |
|
|
|
698 |
|
Weighted Average Common Units
and Common Unit Equivalents |
|
772 |
|
|
|
769 |
|
|
|
|
|
Implied DCF per Common Unit
(7) |
$ |
0.67 |
|
|
$ |
0.63 |
|
Implied DCF per Common Unit
and Common Unit Equivalent (8) |
$ |
0.67 |
|
|
$ |
0.62 |
|
|
|
|
|
Cash Distribution Paid per
Common Unit |
$ |
0.3175 |
|
|
$ |
0.2675 |
|
Common Unit Cash Distributions
(6) |
$ |
223 |
|
|
$ |
187 |
|
Common Unit Distribution
Coverage Ratio |
2.11x |
|
2.37x |
|
|
|
|
Implied DCF Excess |
$ |
247 |
|
|
$ |
256 |
|
(1) |
|
Adjustment to exclude our proportionate share of depreciation and
amortization expense (including write-downs related to cancelled
projects and impairments) of unconsolidated entities. |
(2) |
|
See the “Selected Items Impacting Comparability” table for
additional information. |
(3) |
|
Excludes certain non-cash items impacting interest expense such as
amortization of debt issuance costs and terminated interest rate
swaps. |
(4) |
|
Investment capital expenditures attributable to noncontrolling
interests that reduce Implied DCF available to PAA common
unitholders. |
(5) |
|
Comprised of cash distributions received from unconsolidated
entities less equity earnings in unconsolidated entities (adjusted
for our proportionate share of depreciation and amortization,
including write-downs related to cancelled projects and
impairments, and selected items impacting comparability of
unconsolidated entities). |
(6) |
|
Cash distributions paid during the period presented. |
(7) |
|
Implied DCF Available to Common Unitholders for the period divided
by the weighted average common units outstanding for the
period. |
(8) |
|
Implied DCF Available to Common Unitholders for the period,
adjusted for Series A preferred unit cash distributions paid,
divided by the weighted average common units and common unit
equivalents outstanding for the period. Our Series A preferred
units are convertible into common units, generally on a one-for-one
basis and subject to customary anti-dilution adjustments, in whole
or in part, subject to certain minimum conversion amounts. |
|
|
|
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
Net Income Per Common Unit to Implied DCF Per Common
Unit and Common Unit Equivalent Reconciliation:
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
Basic net income per common unit |
$ |
0.29 |
|
$ |
0.52 |
Reconciling items per common
unit (1) (2) |
|
0.38 |
|
|
0.11 |
Implied DCF per common
unit |
$ |
0.67 |
|
$ |
0.63 |
|
|
|
|
Basic net income per common
unit |
$ |
0.29 |
|
$ |
0.52 |
Reconciling items per common
unit and common unit equivalent (1) (3) |
|
0.38 |
|
|
0.10 |
Implied DCF per common unit
and common unit equivalent |
$ |
0.67 |
|
$ |
0.62 |
(1) |
|
Represents adjustments to Net Income to calculate Implied DCF
Available to Common Unitholders. See the “Net Income to Adjusted
EBITDA attributable to PAA and Implied DCF Reconciliation” table
for additional information. |
(2) |
|
Based on weighted average common
units outstanding for the period of 701 million and 698 million,
respectively. |
(3) |
|
Based on weighted average common
units outstanding for the period, as well as weighted average
Series A preferred units outstanding of 71 million for each of the
periods presented. |
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
Net Cash Provided by Operating Activities to Non-GAAP
Financial Liquidity Measures Reconciliation:
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
Net cash provided by operating activities |
$ |
419 |
|
|
$ |
743 |
|
Adjustments to reconcile Net
cash provided by operating activities to Adjusted Free Cash
Flow: |
|
|
|
Net cash provided by/(used in) investing activities |
|
(261 |
) |
|
|
158 |
|
Cash contributions from noncontrolling interests |
|
12 |
|
|
|
— |
|
Cash distributions paid to noncontrolling interests (1) |
|
(100 |
) |
|
|
(78 |
) |
Adjusted Free Cash Flow
(2) |
$ |
70 |
|
|
$ |
823 |
|
Cash distributions (3) |
|
(287 |
) |
|
|
(242 |
) |
Adjusted Free Cash Flow after
Distributions (2) |
$ |
(217 |
) |
|
$ |
581 |
|
|
|
|
|
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
Adjusted Free Cash Flow
(2) |
$ |
70 |
|
|
$ |
823 |
|
Changes in assets and liabilities, net of acquisitions (4) |
|
192 |
|
|
|
(198 |
) |
Adjusted Free Cash Flow
(Excluding Changes in Assets & Liabilities) (5) |
$ |
262 |
|
|
$ |
625 |
|
Cash distributions (3) |
|
(287 |
) |
|
|
(242 |
) |
Adjusted Free Cash Flow after
Distributions (Excluding Changes in Assets & Liabilities)
(5) |
$ |
(25 |
) |
|
$ |
383 |
|
(1) |
|
Cash distributions paid during the period presented. |
(2) |
|
Management uses the non-GAAP financial liquidity measures Adjusted
Free Cash Flow and Adjusted Free Cash Flow after Distributions to
assess the amount of cash that is available for distributions, debt
repayments, common equity repurchases and other general partnership
purposes. |
(3) |
|
Cash distributions paid to preferred and common unitholders during
the period. |
(4) |
|
See the “Condensed Consolidated Statements of Cash Flows”
table. |
(5) |
|
Management uses the non-GAAP financial liquidity measures Adjusted
Free Cash Flow (Excluding Changes in Assets & Liabilities) and
Adjusted Free Cash Flow after Distributions (Excluding Changes in
Assets & Liabilities) to assess the underlying business
liquidity and cash flow generating capacity excluding fluctuations
caused by timing of when amounts earned or incurred were collected,
received or paid from period to period. |
|
|
|
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
SELECTED ITEMS IMPACTING COMPARABILITY(in
millions)
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
Selected Items
Impacting Comparability: (1) |
|
|
|
Derivative activities and inventory valuation adjustments (2) |
$ |
(159 |
) |
|
$ |
(34 |
) |
Long-term inventory costing
adjustments (3) |
|
33 |
|
|
|
(29 |
) |
Deficiencies under minimum
volume commitments, net (4) |
|
12 |
|
|
|
7 |
|
Equity-indexed compensation
expense (5) |
|
(9 |
) |
|
|
(10 |
) |
Foreign currency revaluation
(6) |
|
9 |
|
|
|
3 |
|
Selected items impacting comparability - Adjusted EBITDA |
$ |
(114 |
) |
|
$ |
(63 |
) |
Gains/(losses) on asset sales,
net |
|
— |
|
|
|
154 |
|
Tax effect on selected items
impacting comparability |
|
30 |
|
|
|
(10 |
) |
Aggregate selected items
impacting noncontrolling interests |
|
(4 |
) |
|
|
(3 |
) |
Selected items impacting comparability - Adjusted net income
attributable to PAA |
$ |
(88 |
) |
|
$ |
78 |
|
(1) |
|
Certain of our non-GAAP financial measures may not be impacted by
each of the selected items impacting comparability. See the “Net
Income to Adjusted EBITDA attributable to PAA and Implied DCF
Reconciliation” and “Computation of Basic and Diluted Adjusted Net
Income Per Common Unit” tables for additional details on how these
selected items impacting comparability affect such measures. |
(2) |
|
We use derivative instruments for risk management purposes and our
related processes include specific identification of hedging
instruments to an underlying hedged transaction. Although we
identify an underlying transaction for each derivative instrument
we enter into, there may not be an accounting hedge relationship
between the instrument and the underlying transaction. In the
course of evaluating our results, we identify differences in the
timing of earnings from the derivative instruments and the
underlying transactions and exclude the related gains and losses in
determining adjusted results such that the earnings from the
derivative instruments and the underlying transactions impact
adjusted results in the same period. In addition, we exclude gains
and losses on derivatives that are related to (i) investing
activities, such as the purchase of linefill, and (ii) purchases of
long-term inventory. We also exclude the impact of corresponding
inventory valuation adjustments, as applicable. For applicable
periods, we excluded gains and losses from the mark-to-market of
the embedded derivative associated with the Preferred Distribution
Rate Reset Option of our Series A preferred units. |
(3) |
|
We carry crude oil and NGL inventory that is comprised of minimum
working inventory requirements in third-party assets and other
working inventory that is needed for our commercial operations. We
consider this inventory necessary to conduct our operations and we
intend to carry this inventory for the foreseeable future.
Therefore, we classify this inventory as long-term on our balance
sheet and do not hedge the inventory with derivative instruments
(similar to linefill in our own assets). We treat the impact of
changes in the average cost of the long-term inventory (that result
from fluctuations in market prices) and write-downs of such
inventory that result from price declines as a selected item
impacting comparability. |
(4) |
|
We, and certain of our equity method investees, have certain
agreements that require counterparties to deliver, transport or
throughput a minimum volume over an agreed upon period.
Substantially all of such agreements were entered into with
counterparties to economically support the return on capital
expenditure necessary to construct the related asset. Some of these
agreements include make-up rights if the minimum volume is not met.
We record a receivable from the counterparty in the period that
services are provided or when the transaction occurs, including
amounts for deficiency obligations from counterparties associated
with minimum volume commitments. If a counterparty has a make-up
right associated with a deficiency, we defer the revenue
attributable to the counterparty’s make-up right and subsequently
recognize the revenue at the earlier of when the deficiency volume
is delivered or shipped, when the make-up right expires or when it
is determined that the counterparty’s ability to utilize the
make-up right is remote. We include the impact of amounts billed to
counterparties for their deficiency obligation, net of applicable
amounts subsequently recognized into revenue or equity earnings, as
a selected item impacting comparability. We believe the inclusion
of the contractually committed revenues associated with that period
is meaningful to investors as the related asset has been
constructed, is standing ready to provide the committed service and
the fixed operating costs are included in the current period
results. |
(5) |
|
Our total equity-indexed compensation expense includes expense
associated with awards that will be settled in units and awards
that will be settled in cash. The awards that will be settled in
units are included in our diluted net income per unit calculation
when the applicable performance criteria have been met. We consider
the compensation expense associated with these awards as a selected
item impacting comparability as the dilutive impact of the
outstanding awards is included in our diluted net income per unit
calculation, as applicable. The portion of compensation expense
associated with awards that will be settled in cash is not
considered a selected item impacting comparability. |
(6) |
|
During the periods presented, there were fluctuations in the value
of the Canadian dollar to the U.S. dollar, resulting in the
realization of foreign exchange gains and losses on the settlement
of foreign currency transactions as well as the revaluation of
monetary assets and liabilities denominated in a foreign currency.
The associated gains and losses are not integral to our results and
were thus classified as a selected item impacting
comparability. |
|
|
|
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
SELECTED FINANCIAL DATA BY SEGMENT(in
millions)
|
Three Months EndedMarch 31,
2024 |
|
|
Three Months EndedMarch 31,
2023 |
|
Crude Oil |
|
NGL |
|
|
Crude Oil |
|
NGL |
Revenues (1) |
$ |
11,582 |
|
|
$ |
507 |
|
|
|
$ |
11,758 |
|
|
$ |
690 |
|
Purchases and related costs
(1) |
|
(10,665 |
) |
|
|
(346 |
) |
|
|
|
(10,940 |
) |
|
|
(490 |
) |
Field operating costs (2) |
|
(266 |
) |
|
|
(92 |
) |
|
|
|
(257 |
) |
|
|
(100 |
) |
Segment general and
administrative expenses (2) (3) |
|
(73 |
) |
|
|
(23 |
) |
|
|
|
(67 |
) |
|
|
(19 |
) |
Equity earnings in
unconsolidated entities |
|
95 |
|
|
|
— |
|
|
|
|
89 |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
Adjustments: (4) |
|
|
|
|
|
|
|
|
Depreciation and amortization of unconsolidated entities |
|
19 |
|
|
|
— |
|
|
|
|
22 |
|
|
|
— |
|
Derivative activities and inventory valuation adjustments |
|
37 |
|
|
|
122 |
|
|
|
|
(12 |
) |
|
|
104 |
|
Long-term inventory costing adjustments |
|
(28 |
) |
|
|
(5 |
) |
|
|
|
21 |
|
|
|
8 |
|
Deficiencies under minimum volume commitments, net |
|
(12 |
) |
|
|
— |
|
|
|
|
(7 |
) |
|
|
— |
|
Equity-indexed compensation expense |
|
9 |
|
|
|
— |
|
|
|
|
10 |
|
|
|
— |
|
Foreign currency revaluation |
|
(17 |
) |
|
|
(4 |
) |
|
|
|
(2 |
) |
|
|
(1 |
) |
Segment amounts attributable to noncontrolling interests (5) |
|
(128 |
) |
|
|
— |
|
|
|
|
(98 |
) |
|
|
— |
|
Segment Adjusted EBITDA |
$ |
553 |
|
|
$ |
159 |
|
|
|
$ |
517 |
|
|
$ |
192 |
|
|
|
|
|
|
|
|
|
|
Maintenance capital expenditures |
$ |
46 |
|
|
$ |
11 |
|
|
|
$ |
32 |
|
|
$ |
16 |
|
(1) |
|
Includes intersegment
amounts. |
(2) |
|
Field operating costs and Segment
general and administrative expenses include equity-indexed
compensation expense. |
(3) |
|
Segment general and administrative expenses reflect direct costs
attributable to each segment and an allocation of other expenses to
the segments. The proportional allocations by segment require
judgment by management and are based on the business activities
that exist during each period. |
(4) |
|
Represents adjustments utilized
by our CODM in the evaluation of segment results. Many of these
adjustments are also considered selected items impacting
comparability when calculating consolidated non-GAAP financial
measures such as Adjusted EBITDA. See the “Selected Items Impacting
Comparability” table for additional discussion. |
(5) |
|
Reflects amounts attributable to
noncontrolling interests in the Permian JV, Cactus II Pipeline LLC
and Red River Pipeline LLC. |
|
|
|
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
OPERATING DATA BY SEGMENT
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
Crude Oil Segment
Volumes |
|
|
|
Crude oil pipeline tariff volumes (by region) (1) |
|
|
|
Permian Basin (2) |
6,428 |
|
6,295 |
South Texas / Eagle Ford (2) |
378 |
|
400 |
Mid-Continent (2) |
486 |
|
471 |
Gulf Coast (2) |
202 |
|
258 |
Rocky Mountain (2) |
499 |
|
341 |
Western |
259 |
|
164 |
Canada |
348 |
|
351 |
Total crude oil pipeline tariff volumes (1) (2) |
8,600 |
|
8,280 |
|
|
|
|
Commercial crude oil storage capacity (2) (3) |
72 |
|
72 |
|
|
|
|
Crude oil lease gathering purchases (1) |
1,508 |
|
1,428 |
|
|
|
|
NGL Segment
Volumes (1) |
|
|
|
NGL fractionation |
128 |
|
144 |
NGL pipeline tariff volumes |
214 |
|
194 |
Propane and butane sales |
128 |
|
138 |
(1) |
|
Average volumes in thousands of barrels per day calculated as the
total volumes (attributable to our interest for assets owned by
unconsolidated entities or through undivided joint interests) for
the period divided by the number of days in the period. Volumes
associated with assets acquired during the period represent total
volumes for the number of days we actually owned the assets divided
by the number of days in the period. |
(2) |
|
Includes volumes (attributable to our interest) from assets owned
by unconsolidated entities. |
(3) |
|
Average monthly capacity in millions of barrels calculated as total
volumes for the period divided by the number of months in the
period. |
|
|
|
PLAINS ALL AMERICAN PIPELINE, L.P. AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
NON-GAAP SEGMENT RECONCILIATIONS(in
millions)
Supplemental Adjusted EBITDA attributable to PAA
Reconciliation:
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
Crude Oil Segment Adjusted EBITDA |
$ |
553 |
|
$ |
517 |
NGL Segment Adjusted
EBITDA |
|
159 |
|
|
192 |
Adjusted other
income/(expense), net (1) |
|
6 |
|
|
6 |
Adjusted EBITDA attributable to PAA (2) |
$ |
718 |
|
$ |
715 |
(1) |
|
Represents “Other income/(expense), net” as reported on our
Condensed Consolidated Statements of Operations, excluding other
income/(expense), net attributable to noncontrolling interests,
adjusted for selected items impacting comparability. See the
“Selected Items Impacting Comparability” table for additional
information. |
(2) |
|
See the “Net Income to Adjusted EBITDA attributable to PAA and
Implied DCF Reconciliation” table for reconciliation to Net
Income. |
|
|
|
PLAINS GP HOLDINGS AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
CONDENSED CONSOLIDATING STATEMENTS OF
OPERATIONS(in millions, except per share data)
|
Three Months EndedMarch 31,
2024 |
|
|
Three Months EndedMarch 31,
2023 |
|
|
|
Consolidating |
|
|
|
|
|
|
Consolidating |
|
|
|
PAA |
|
Adjustments (1) |
|
PAGP |
|
|
PAA |
|
Adjustments (1) |
|
PAGP |
REVENUES |
$ |
11,995 |
|
|
$ |
— |
|
|
$ |
11,995 |
|
|
|
$ |
12,341 |
|
|
$ |
— |
|
|
$ |
12,341 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COSTS AND
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
Purchases and related
costs |
|
10,917 |
|
|
|
— |
|
|
|
10,917 |
|
|
|
|
11,323 |
|
|
|
— |
|
|
|
11,323 |
|
Field operating costs |
|
358 |
|
|
|
— |
|
|
|
358 |
|
|
|
|
357 |
|
|
|
— |
|
|
|
357 |
|
General and administrative
expenses |
|
96 |
|
|
|
1 |
|
|
|
97 |
|
|
|
|
86 |
|
|
|
1 |
|
|
|
87 |
|
Depreciation and
amortization |
|
254 |
|
|
|
— |
|
|
|
254 |
|
|
|
|
256 |
|
|
|
1 |
|
|
|
257 |
|
(Gains)/losses on asset sales,
net |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
(154 |
) |
|
|
— |
|
|
|
(154 |
) |
Total costs and expenses |
|
11,625 |
|
|
|
1 |
|
|
|
11,626 |
|
|
|
|
11,868 |
|
|
|
2 |
|
|
|
11,870 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING
INCOME |
|
370 |
|
|
|
(1 |
) |
|
|
369 |
|
|
|
|
473 |
|
|
|
(2 |
) |
|
|
471 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER
INCOME/(EXPENSE) |
|
|
|
|
|
|
|
|
|
|
|
|
Equity earnings in
unconsolidated entities |
|
95 |
|
|
|
— |
|
|
|
95 |
|
|
|
|
89 |
|
|
|
— |
|
|
|
89 |
|
Interest expense, net |
|
(95 |
) |
|
|
— |
|
|
|
(95 |
) |
|
|
|
(98 |
) |
|
|
— |
|
|
|
(98 |
) |
Other income/(expense),
net |
|
(5 |
) |
|
|
— |
|
|
|
(5 |
) |
|
|
|
64 |
|
|
|
— |
|
|
|
64 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME BEFORE
TAX |
|
365 |
|
|
|
(1 |
) |
|
|
364 |
|
|
|
|
528 |
|
|
|
(2 |
) |
|
|
526 |
|
Current income tax
expense |
|
(53 |
) |
|
|
— |
|
|
|
(53 |
) |
|
|
|
(61 |
) |
|
|
— |
|
|
|
(61 |
) |
Deferred income tax
(expense)/benefit |
|
39 |
|
|
|
(14 |
) |
|
|
25 |
|
|
|
|
8 |
|
|
|
(30 |
) |
|
|
(22 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
INCOME |
|
351 |
|
|
|
(15 |
) |
|
|
336 |
|
|
|
|
475 |
|
|
|
(32 |
) |
|
|
443 |
|
Net income attributable to noncontrolling interests |
|
(85 |
) |
|
|
(209 |
) |
|
|
(294 |
) |
|
|
|
(53 |
) |
|
|
(321 |
) |
|
|
(374 |
) |
NET INCOME
ATTRIBUTABLE TO PAGP |
$ |
266 |
|
|
$ |
(224 |
) |
|
$ |
42 |
|
|
|
$ |
422 |
|
|
$ |
(353 |
) |
|
$ |
69 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted weighted
average Class A shares outstanding |
|
|
|
|
|
|
|
|
|
197 |
|
|
|
|
|
|
|
|
194 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net income per
Class A share |
|
|
|
|
|
|
|
|
$ |
0.21 |
|
|
|
|
|
|
|
$ |
0.35 |
|
(1) Represents the aggregate consolidating
adjustments necessary to produce consolidated financial statements
for PAGP.
PLAINS GP HOLDINGS AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
CONDENSED CONSOLIDATING BALANCE SHEET DATA(in
millions)
|
March 31, 2024 |
|
|
December 31, 2023 |
|
|
|
Consolidating |
|
|
|
|
|
|
Consolidating |
|
|
|
PAA |
|
Adjustments (1) |
|
PAGP |
|
|
PAA |
|
Adjustments (1) |
|
PAGP |
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
Current assets |
$ |
5,001 |
|
$ |
3 |
|
|
$ |
5,004 |
|
|
$ |
4,913 |
|
$ |
3 |
|
|
$ |
4,916 |
Property and equipment,
net |
|
15,671 |
|
|
— |
|
|
|
15,671 |
|
|
|
15,782 |
|
|
— |
|
|
|
15,782 |
Investments in unconsolidated
entities |
|
2,878 |
|
|
— |
|
|
|
2,878 |
|
|
|
2,820 |
|
|
— |
|
|
|
2,820 |
Intangible assets, net |
|
1,807 |
|
|
— |
|
|
|
1,807 |
|
|
|
1,875 |
|
|
— |
|
|
|
1,875 |
Deferred tax asset |
|
— |
|
|
1,231 |
|
|
|
1,231 |
|
|
|
— |
|
|
1,239 |
|
|
|
1,239 |
Linefill |
|
981 |
|
|
— |
|
|
|
981 |
|
|
|
976 |
|
|
— |
|
|
|
976 |
Long-term operating lease
right-of-use assets, net |
|
298 |
|
|
— |
|
|
|
298 |
|
|
|
313 |
|
|
— |
|
|
|
313 |
Long-term inventory |
|
299 |
|
|
— |
|
|
|
299 |
|
|
|
265 |
|
|
— |
|
|
|
265 |
Other long-term assets,
net |
|
421 |
|
|
— |
|
|
|
421 |
|
|
|
411 |
|
|
— |
|
|
|
411 |
Total assets |
$ |
27,356 |
|
$ |
1,234 |
|
|
$ |
28,590 |
|
|
$ |
27,355 |
|
$ |
1,242 |
|
|
$ |
28,597 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
PARTNERS’ CAPITAL |
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities |
$ |
5,144 |
|
$ |
2 |
|
|
$ |
5,146 |
|
|
$ |
5,003 |
|
$ |
2 |
|
|
$ |
5,005 |
Senior notes, net |
|
7,244 |
|
|
— |
|
|
|
7,244 |
|
|
|
7,242 |
|
|
— |
|
|
|
7,242 |
Other long-term debt, net |
|
64 |
|
|
— |
|
|
|
64 |
|
|
|
63 |
|
|
— |
|
|
|
63 |
Long-term operating lease
liabilities |
|
261 |
|
|
— |
|
|
|
261 |
|
|
|
274 |
|
|
— |
|
|
|
274 |
Other long-term liabilities
and deferred credits |
|
997 |
|
|
— |
|
|
|
997 |
|
|
|
1,041 |
|
|
— |
|
|
|
1,041 |
Total liabilities |
|
13,710 |
|
|
2 |
|
|
|
13,712 |
|
|
|
13,623 |
|
|
2 |
|
|
|
13,625 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Partners’ capital excluding
noncontrolling interests |
|
10,339 |
|
|
(8,821 |
) |
|
|
1,518 |
|
|
|
10,422 |
|
|
(8,874 |
) |
|
|
1,548 |
Noncontrolling interests |
|
3,307 |
|
|
10,053 |
|
|
|
13,360 |
|
|
|
3,310 |
|
|
10,114 |
|
|
|
13,424 |
Total partners’ capital |
|
13,646 |
|
|
1,232 |
|
|
|
14,878 |
|
|
|
13,732 |
|
|
1,240 |
|
|
|
14,972 |
Total liabilities and partners’ capital |
$ |
27,356 |
|
$ |
1,234 |
|
|
$ |
28,590 |
|
|
$ |
27,355 |
|
$ |
1,242 |
|
|
$ |
28,597 |
(1) Represents the aggregate consolidating
adjustments necessary to produce consolidated financial statements
for PAGP.
PLAINS GP HOLDINGS AND
SUBSIDIARIESFINANCIAL SUMMARY
(unaudited)
COMPUTATION OF BASIC AND DILUTED NET INCOME PER CLASS A
SHARE(in millions, except per share data)
|
Three Months EndedMarch 31, |
|
2024 |
|
2023 |
Basic and Diluted Net
Income per Class A Share |
|
|
|
Net income attributable to PAGP |
$ |
42 |
|
$ |
69 |
Basic and diluted weighted average Class A shares
outstanding |
|
197 |
|
|
194 |
|
|
|
|
Basic and diluted net income per Class A share |
$ |
0.21 |
|
$ |
0.35 |
Forward-Looking Statements
Except for the historical information contained
herein, the matters discussed in this release consist of
forward-looking statements that involve certain risks and
uncertainties that could cause actual results or outcomes to differ
materially from results or outcomes anticipated in the
forward-looking statements. These risks and uncertainties include,
among other things, the following:
- general
economic, market or business conditions in the United States and
elsewhere (including the potential for a recession or significant
slowdown in economic activity levels, the risk of persistently high
inflation and continued supply chain issues, the impact of global
public health events, such as pandemics, on demand and growth, and
the timing, pace and extent of economic recovery) that impact (i)
demand for crude oil, drilling and production activities and
therefore the demand for the midstream services we provide and (ii)
commercial opportunities available to us;
- declines in
global crude oil demand and/or crude oil prices or other factors
that correspondingly lead to a significant reduction of North
American crude oil and NGL production (whether due to reduced
producer cash flow to fund drilling activities or the inability of
producers to access capital, or both, the unavailability of
pipeline and/or storage capacity, the shutting-in of production by
producers, government-mandated pro-ration orders, or other
factors), which in turn could result in significant declines in the
actual or expected volume of crude oil and NGL shipped, processed,
purchased, stored, fractionated and/or gathered at or through the
use of our assets and/or the reduction of the margins we can earn
or the commercial opportunities that might otherwise be available
to us;
- fluctuations in
refinery capacity and other factors affecting demand for various
grades of crude oil and NGL and resulting changes in pricing
conditions or transportation throughput requirements;
- unanticipated
changes in crude oil and NGL market structure, grade differentials
and volatility (or lack thereof);
- the effects of
competition and capacity overbuild in areas where we operate,
including downward pressure on rates, volumes and margins, contract
renewal risk and the risk of loss of business to other midstream
operators who are willing or under pressure to aggressively reduce
transportation rates in order to capture or preserve
customers;
- negative
societal sentiment regarding the hydrocarbon energy industry and
the continued development and consumption of hydrocarbons, which
could influence consumer preferences and governmental or regulatory
actions that adversely impact our business;
- environmental
liabilities, litigation or other events that are not covered by an
indemnity, insurance or existing reserves;
- the occurrence
of a natural disaster, catastrophe, terrorist attack (including
eco-terrorist attacks) or other event that materially impacts our
operations, including cyber or other attacks on our electronic and
computer systems;
- weather
interference with business operations or project construction,
including the impact of extreme weather events or conditions;
- the impact of
current and future laws, rulings, legislation, governmental
regulations, executive orders, trade policies, accounting standards
and statements, and related interpretations that (i) prohibit,
restrict or regulate the development of oil and gas resources and
the related infrastructure on lands dedicated to or served by our
pipelines or (ii) negatively impact our ability to develop, operate
or repair midstream assets;
- negative impacts
on production levels in the Permian Basin or elsewhere due to
issues associated with (or laws, rules or regulations relating to)
hydraulic fracturing and related activities (including wastewater
injection or disposal), including earthquakes, subsidence,
expansion or other issues;
- loss of key
personnel and inability to attract and retain new talent;
- disruptions to
futures markets for crude oil, NGL and other petroleum products,
which may impair our ability to execute our commercial or hedging
strategies;
- the
effectiveness of our risk management activities;
- shortages or
cost increases of supplies, materials or labor;
- maintenance of
our credit rating and ability to receive open credit from our
suppliers and trade counterparties;
- the successful
operation of joint ventures and joint operating arrangements we
enter into from time to time, whether relating to assets operated
by us or by third parties, and the successful integration and
future performance of acquired assets or businesses;
- the availability
of, and our ability to consummate, acquisitions, divestitures,
joint ventures or other strategic opportunities;
- the refusal or
inability of our customers or counterparties to perform their
obligations under their contracts with us (including commercial
contracts, asset sale agreements and other agreements), whether
justified or not and whether due to financial constraints (such as
reduced creditworthiness, liquidity issues or insolvency), market
constraints, legal constraints (including governmental orders or
guidance), the exercise of contractual or common law rights that
allegedly excuse their performance (such as force majeure or
similar claims) or other factors;
- our inability to
perform our obligations under our contracts, whether due to
non-performance by third parties, including our customers or
counterparties, market constraints, third-party constraints, supply
chain issues, legal constraints (including governmental orders or
guidance), or other factors or events;
- the incurrence
of costs and expenses related to unexpected or unplanned capital
expenditures, third-party claims or other factors;
- failure to
implement or capitalize, or delays in implementing or capitalizing,
on investment capital projects, whether due to permitting delays,
permitting withdrawals or other factors;
- tightened
capital markets or other factors that increase our cost of capital
or limit our ability to obtain debt or equity financing on
satisfactory terms to fund additional acquisitions, investment
capital projects, working capital requirements and the repayment or
refinancing of indebtedness;
- the
amplification of other risks caused by volatile financial markets,
capital constraints, liquidity concerns and inflation;
- the use or
availability of third-party assets upon which our operations depend
and over which we have little or no control;
- the currency
exchange rate of the Canadian dollar to the United States
dollar;
- inability to
recognize current revenue attributable to deficiency payments
received from customers who fail to ship or move more than minimum
contracted volumes until the related credits expire or are
used;
- significant
under-utilization of our assets and facilities;
- increased costs,
or lack of availability, of insurance;
- fluctuations in
the debt and equity markets, including the price of our units at
the time of vesting under our long-term incentive plans;
- risks related to
the development and operation of our assets;
- the pace of
development of natural gas infrastructure and its impact on
expected crude oil production growth in the Permian Basin; and
- other factors
and uncertainties inherent in the transportation, storage,
terminalling and marketing of crude oil, as well as in the
processing, transportation, fractionation, storage and marketing of
NGL as discussed in the Partnerships’ filings with the Securities
and Exchange Commission.
About Plains:
PAA is a publicly traded master limited
partnership that owns and operates midstream energy infrastructure
and provides logistics services for crude oil and natural gas
liquids (“NGL”). PAA owns an extensive network of pipeline
gathering and transportation systems, in addition to terminalling,
storage, processing, fractionation and other infrastructure assets
serving key producing basins, transportation corridors and major
market hubs and export outlets in the United States and Canada. On
average, PAA handles over 8 million barrels per day of crude oil
and NGL.
PAGP is a publicly traded entity that owns an
indirect, non-economic controlling general partner interest in PAA
and an indirect limited partner interest in PAA, one of the largest
energy infrastructure and logistics companies in North America.
PAA and PAGP are headquartered in Houston,
Texas. For more information, please visit www.plains.com.
Contacts:
Blake Fernandez |
Vice President, Investor
Relations |
(866) 809-1291 |
|
Michael Gladstein |
Director, Investor
Relations |
(866) 809-1291 |
Plains All American Pipe... (NASDAQ:PAA)
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