Houston pipeline operator Enterprise Products Partners reported a $1 billion profit during the third quarter but missed Wall Street revenue expectations amid weaker commodity prices for crude oil, natural gas and natural gas liquids such as ethane, propane and butane.
Enterprise reported a $1 billion profit on nearly $8 billion of revenue during the third quarter. The figures were down compared to the $1.3 billion of profit on $9.6 billion of revenue during the third quarter of 2018.
The company’s third quarter results translated into earnings per share of 46 cents, which were down compared to earnings per share of 60 cents during the same time period last year.
The company attributed part of the dip in profits to $86 million of interest charges for its hedging activity and a one-time impairment charge of $39 million attributed to writing down the value of equipment during the third quarter.
[contextly_sidebar id=”czIe3DlbtOEacLItVHHz2HaItUXu3oQH”]
Enterprise earns fees for moving crude oil, natural gas and natural gas liquids or its customers but its marketing division also buys and sells them — creating exposure to commodity prices. During the third quarter, the company moved higher volumes of those commodities but lower commodity prices resulted in lower revenue for the share it bought and sold.
“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,” Enterprise CEO Jim Teague said.
Founded in 1968 with a pair of propane delivery trucks, the Houston pipeline operator now has more than 7,000 employees across the United States.
Touted as the largest exporter of crude oil and natural gas liquids in the United States, the company reported making a $4.2 billion profit on $36.5 billion of revenue in 2018.
