Enterprise Products Partners L.p. · NYSE:EPD
Enterprise Products Partners L.p — Investor Presentation (November 2021)
18 slides from Enterprise Products Partners L.p's investor presentation, Nov 17, 2021
Slide 1: Allocation of Capital
Exhibit 99.1 ENTERPRISE PRODUCTS PARTNERS L.P. ALLOCATION OF CAPITAL November 17, 2021
Slide 2: Forward-Looking Statements
Forward‐Looking Statements This presentation contains forward‐looking statements based on the beliefs of the company, as well as assumptions made by, and information currently available to our management team (including information published by third parties). When used in this presentation, words s
Slide 3: Allocation of Capital Priorities and Rationale
Allocation of Capital Priorities and Rationale “All of the Above” Approach Support and grow cash distributions to partners •For partnerships, distributions are the most direct and tax efficient method to return capital to partners st 1 § Substantially all of the incremental distributions are tax def
Slide 4: History of Deploying Capital at Attractive, Long Term Returns
History of Deploying Capital at Attractive, Long Term Returns Return on Invested Capital (1) (2) (3) EPD’s Historical Return on Invested Capital ( ROIC ) 16% 14% 13% 13% 13% 13% 13% 13% 12% 12% 12% 12% 12% 11% 11% 11% 11% 11% 11% 10% 10% 8% 6% 4% 2% 0% 2005 2006 2007 2008 2009 2010 2011 2012 2013 20
Slide 5: Consistent History of EPD Returning Capital to Partners
Consistent History of EPD Returning Capital to Partners Allocation of Cash Flow from Operations % of CFFO 100% 90% 80% 70% 3% 1% 1% 60% 1% 50% 86% 83% 40% 78% 77% 77% 76% 75% 67% 66% 65% 64% 61% 61% 61% 30% 59% 50% 20% 10% 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Slide 6: History of Responsible Distribution Growth
History of Responsible Distribution Growth 23 Years of Growing Distributions Throughout Business Cycles (1) EPD’s Historical Distribution Growth Financial Model (2) Transition $2.00 $1.80 $1.80 $1.60 $1.40 $1.20 $1.00 $0.80 $0.60 $0.45 $0.40 $0.20 $0.00 1998 1999 2000 2001 2002 2003 2004 2005 2006 2
Slide 7: Successful History of Execution
Successful History of Execution Preserve, Protect and Provide Partners Reliable / Growing Distributions • Dependable distribution growth and cash flow coverage in excess of distributions • Solid balance sheet; BBB+ rated (highest in the midstream space) and TTM leverage of 3.2x $ in MMs 23 Years of
Slide 8: Midstream Sector Payout vs. CFFO: Last Year
Midstream Sector Payout vs. CFFO EPD has returned $4.1B of CFFO to investors over the last year 1 Year Ending 9/30/2021 Return of Capital Asset Distributions CFFO Buybacks (2) Total As% of CFFO & Sales Paid Company Total As% of CFFO Asset Sales ($MM) ($MM) ($MM) ($MM) (%) (%) no distribution cuts En
Slide 9: Midstream Sector Payout vs. CFFO: Last 3 Years
Midstream Sector Payout vs. CFFO EPD has returned $12.1B of CFFO to investors over the last 3 years 3Years Ending 9/30/2021 Return of Capital Asset Distributions CFFO Buybacks (2) Total As% of CFFO & Sales Paid Company Total As% of CFFO Asset Sales ($MM) ($MM) ($MM) ($MM) (%) (%) no distribution cut
Slide 10: Midstream Sector Payout vs. CFFO: Last 5 Years
Midstream Sector Payout vs. CFFO EPD has returned $19.3B of CFFO to investors over the last 5 years 5Years Ending 9/30/2021 Return of Capital Asset Distributions CFFO Buybacks (2) Total As% of CFFO & Sales Paid Company Total As% of CFFO Asset Sales ($MM) ($MM) ($MM) ($MM) (%) (%) no distribution cut
Slide 11: Capital Allocation Trends Across S&P Sectors
Capital Allocation Trends Across S&P 500 Sectors (1) As % of Cash Flow from Operations Payout/CFFO Ranked Payout Real Estate 49% 64% 1% 65% 1 Consumer Staples 26% 42% 12% 54% 2 Information Technology 11% 17% 35% 52% 3 Enterprise 30% 50% 1% 51% 4 Industrials 21% 22% 20% 42% 6 Utilities 146% 37% 37% 7
Slide 12: Unsurpassed History of GP Alignment with Common Equity Holders
Unsurpassed History of GP Alignment with Common Equity Holders 1998 IPO: reinvested substantiallyall IPO proceeds into EPD Eliminated 50% IDRs for no consideration 2002 $34.2MM participation in equity follow‐on offering Since IPO $33MM participation in equity follow‐on offering $124 Million 2003 $55
Slide 13: Key Investment Considerations
Key Investment Considerations • Successful history of responsibly returning capital to partners § “All of the Above” approach § Primarily focused on distributions: most direct and tax efficient return of capital § 23 consecutive years of distribution growth throughout business cycles § Opportunistic
Slide 14: Appendix
APPENDIX
Slide 15: Definitions
Definitions • Operational Distributable Cash Flow (“DCF”) represents DCF excluding proceeds from asset sales and property damage insurance claims and net receipts / payments from the monetization of interest rate derivative instruments. • Net Cash Flows Provided by Operating Activities (“CFFO”)repre
Slide 16: Distributable Cash Flow
Distributable Cash Flow We measure cash available for distribution by reference to distributable cash flow (“DCF”). DCF is a quantitative standard used by the investment community for evaluating publicly traded partnerships since the value of a partnership unit is, in part, measured by its yield, wh
Slide 17: Gross Operating Margin
Gross Operating Margin We evaluate segment performance based on our financial measure of gross operating margin (“GOM”). GOM is an important performance measure of the core profitability of our operations and forms the basis of our internal financial reporting. We believe that investors benefit from
Slide 18: Adjusted EBITDA
Adjusted EBITDA Adjusted EBITDA is commonly used as a supplemental financial measure by our management and external users of our financial statements, suchas investors, commercial banks, researchanalysts and rating agencies, to assess the financial performance of our assets without regard to financi
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