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Analyzing Cash Flows of Master Limited Partnerships

Stock Quotes

BPL81.00  chart-0.07
BWP18.38  chart-0.56
EPB33.39  chart-0.74
EPD75.39  chart-1.44
ETP56.15  chart-0.885
KMP80.64  chart-1.53
MMP82.05  chart+0.15
NGLS66.71  chart-1.45
CEQP14.70  chart-0.40
RGP30.42  chart-0.61
PAA58.20  chart-0.46
SPH44.1085  chart-0.2715
WPZ50.56  chart-1.04
NLY11.095  chart-0.085
AGNC23.015  chart+0.085
2014-07-31 13:16

EPB - A Closer Look at El Paso Pipeline Partners' Distributable Cash Flow as of 2Q 2014

master limited partnership logos-EPB

Author: Ron Hiram

Published: July 30, 2014

This article supplements, and should be read in conjunction with, my preliminary review of 2Q14 results recently reported by El Paso Pipeline Partners, L.P. (EPB). I now evaluate the sustainability of EPB’s Distributable Cash Flow (“DCF”) and assesses whether EPB is financing its distributions via issuance of new units or debt.

DCF is one of the primary measures typically used master limited partnerships (“MLPs”) to evaluate their operating results. However, each MLP may define this term differently, making comparisons difficult. In addition, MLPs typically include non-sustainable items in their definitions of DCF.

EPB’s method of determining DCF is detailed in an article titled Distributable Cash Flow (DCF) that also provides a comparison to definitions used by other MLPs. Based on this method, EPB derives DCF as shown in Table 1. The adjustments made by management to EBDA are referred to as “certain items”. Encouragingly, the magnitude of these adjustments has noticeably decreased in recent quarters. Continue reading EPB – A Closer Look at El Paso Pipeline Partners’ Distributable Cash Flow as of 2Q 2014

Preliminary review of Kinder Morgan Energy Partners’ results for 2Q 2014

master limited partnership logos-KMP

Author: Ron Hiram

Published: July 28, 2013

This article focuses on some of the key facts and trends revealed by the results of operations reported by Kinder Morgan Energy Partners LP (KMP) for 2Q 2014.

Adjusted earnings before depreciation and amortization (“Adjusted EBDA” or “Segment earnings before DD&A and certain items”) is one of the important yardsticks used by management to measure its success in maximizing returns to the partners, to evaluate segment performance, and to decide how to allocate resources to KMP’s five reportable business segments. Comparing each quarter to its counterpart in the prior year period we see slow growth in Adjusted EBDA per unit over the past 4 calendar quarters, as shown in Table 1 below: Continue reading KMP – Preliminary review of Kinder Morgan Energy Partners’ results for 2Q 2014

EPB - Preliminary review of El Paso Pipeline Partners’ results for 2Q 2014

master limited partnership logos-EPB

Author: Ron Hiram

Published: July 27, 2014

This article focuses on some of the key facts and trends revealed by the results of operations reported by El Paso Pipeline Partners, L.P. (EPB) for 2Q 2014. Continue reading EPB – Preliminary review of El Paso Pipeline Partners’ results for 2Q 2014

BPL - A Closer Look at Buckeye Partners' Distributable Cash Flow as of 1Q 2014

master limited partnership logos-BPL

Author: Ron Hiram

Published: May 26, 2014

Buckeye Partners L.P.  (BPL) recently reported its results of operations for 1Q 2014. This article analyses some of the key facts and trends revealed by this and prior BPL reports, evaluates the sustainability of BPL’s Distributable Cash Flow (“DCF”) and assesses whether BPL is financing its distributions via issuance of new units or debt. Continue reading BPL – A Closer Look at Buckeye Partners’ Distributable Cash Flow as of 1Q 2014

Model for assessing sustainability of AGNC‘s 11% dividend yield – 1Q14 update

REIT logos-AGNC

Author: Ron Hiram

Published: May 25, 2014

This article applies a methodology described in my prior articles to assess whether the dividends paid by American Capital Agency Corp. (AGNC) are sustainable in light of the latest available information (1Q14 data) on leverage and interest rate spreads. Continue reading AGNC – Model for assessing sustainability of AGNC‘s 11% dividend yield – 1Q14 update