UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2016 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___ to ___. Commission file number: 1-14323 ENTERPRISE PRODUCTS PARTNERS L.P. (Exact Name of Registrant as Specified in Its Charter) Delaware 76-0568219 (State or Other Jurisdiction of (I.R.S. Employer Identification No.) Incorporation or Organization) 1100 Louisiana Street, 10th Floor Houston, Texas 77002 (Address of Principal Executive Offices, including Zip Code) (713) 381-6500 (Registrant's Telephone Number, including Area Code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No There were 2,094,540,009 common units of Enterprise Products Partners L.P. outstanding at the close of business on July 29, 2016. Our common units trade on the New York Stock Exchange under the ticker symbol "EPD."
ENTERPRISE PRODUCTS PARTNERS L.P. TABLE OF CONTENTS Page No. PART I. FINANCIAL INFORMATION. Item 1. Financial Statements. Unaudited Condensed Consolidated Balance Sheets 2 Unaudited Condensed Statements of Consolidated Operations 3 Unaudited Condensed Statements of Consolidated Comprehensive Income 4 Unaudited Condensed Statements of Consolidated Cash Flows 5 Unaudited Condensed Statements of Consolidated Equity 6 Notes to Unaudited Condensed Consolidated Financial Statements: 1. Partnership Operations, Organization and Basis of Presentation 7 2. General Accounting and Disclosure Matters 8 3. Inventories 10 4. Property, Plant and Equipment 11 5. Investments in Unconsolidated Affiliates 12 6. Intangible Assets and Goodwill 14 7. Debt Obligations 15 8. Equity and Distributions 17 9. Business Segments 19 10. Earnings Per Unit 24 11. Equity-Based Awards 24 12. Derivative Instruments, Hedging Activities and Fair Value Measurements 28 13. Related Party Transactions 37 14. Commitments and Contingencies 38 15. Supplemental Cash Flow Information 41 16. Condensed Consolidating Financial Information 42 17. Subsequent Event 49 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. 50 Item 3. Quantitative and Qualitative Disclosures About Market Risk. 76 Item 4. Controls and Procedures. 79 PART II. OTHER INFORMATION. Item 1. Legal Proceedings. 80 Item 1A. Risk Factors. 80 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. 80 Item 3. Defaults Upon Senior Securities. 80 Item 4. Mine Safety Disclosures. 80 Item 5. Other Information. 81 Item 6. Exhibits. 81 Signatures 89 1
Table of Contents PART I. FINANCIAL INFORMATION. Item 1. Financial Statements . ENTERPRISE PRODUCTS PARTNERS L.P. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in millions) June 30, December 31, 2016 2015 ASSETS Current assets: Cash and cash equivalents $ 113.5 $ 19.0 372.6 15.9 Restricted cash Accounts receivable – trade, net of allowance for doubtful accounts of $10.7 at June 30, 2016 and $12.1 at December 31, 2015 3,055.4 2,569.9 2.1 1.2 Accounts receivable – related parties Inventories 1,714.9 1,038.1 281.4 258.6 Derivative assets Prepaid and other current assets 429.8 395.6 Total current assets 5,969.7 4,298.3 33,011.5 32,034.7 Property, plant and equipment, net Investments in unconsolidated affiliates 2,669.4 2,628.5 Intangible assets, net of accumulated amortization of $1,324.8 at June 30, 2016 and $1,235.8 at December 31, 2015 (see Note 6) 3,948.3 4,037.2 5,745.2 5,745.2 Goodwill (see Note 6) Other assets 56.7 58.3 $ 51,400.8 $ 48,802.2 Total assets LIABILITIES AND EQUITY Current liabilities: $ 875.4 $ 1,863.9 Current maturities of debt (see Note 7) 602.6 860.1 Accounts payable – trade 78.8 84.1 Accounts payable – related parties Accrued product payables 3,262.9 2,484.4 999.7 993.2 Accrued liability related to EFS Midstream acquisition (see Note 17) Accrued interest 350.9 352.1 529.4 140.6 Derivative liabilities Other current liabilities 326.3 388.2 7,026.0 7,166.6 Total current liabilities Long-term debt (see Note 7) 21,922.1 20,676.9 50.6 46.1 Deferred tax liabilities 456.2 411.5 Other long-term liabilities Commitments and contingencies (see Note 14) Equity: Partners' equity: Limited partners: Common units (2,092,325,330 units outstanding at June 30, 2016 and 2,012,553,024 units outstanding at December 31, 2015) 22,031.2 20,514.3 (307.0) Accumulated other comprehensive loss (219.2) 21,724.2 20,295.1 Total partners' equity Noncontrolling interests 221.7 206.0 Total equity 21,945.9 20,501.1 $ 51,400.8 $ 48,802.2 Total liabilities and equity See Notes to Unaudited Condensed Consolidated Financial Statements. 2
Table of Contents ENTERPRISE PRODUCTS PARTNERS L.P. UNAUDITED CONDENSED STATEMENTS OF CONSOLIDATED OPERATIONS (Dollars in millions, except per unit amounts) For the Three Months For the Six Months Ended June 30, Ended June 30, 2016 2015 2016 2015 Revenues: $ 5,604.6 $ 7,085.2 $ 10,594.3 $ 14,551.6 Third parties Related parties 13.2 7.3 28.8 13.4 Total revenues (see Note 9) 5,617.8 7,092.5 10,623.1 14,565.0 Costs and expenses: Operating costs and expenses: 4,551.9 6,090.4 8,418.2 12,474.7 Third parties Related parties 270.3 267.1 550.9 499.2 Total operating costs and expenses 4,822.2 6,357.5 8,969.1 12,973.9 General and administrative costs: 6.6 16.8 20.9 37.1 Third parties Related parties 28.5 28.1 58.1 57.1 35.1 44.9 79.0 94.2 Total general and administrative costs 4,857.3 6,402.4 9,048.1 13,068.1 Total costs and expenses (see Note 9) Equity in income of unconsolidated affiliates 76.4 110.2 177.5 199.4 Operating income 836.9 800.3 1,752.5 1,696.3 Other income (expense): (244.1) (240.4) (484.7) Interest expense (479.5) Change in fair market value of Liquidity Option Agreement (see Note 14) (23.3) (11.5) (21.1) (11.5) 0.4 0.3 1.8 0.8 Other, net (267.0) (251.6) (504.0) Total other expense, net (490.2) Income before income taxes 569.9 548.7 1,248.5 1,206.1 0.1 7.9 (8.3) 1.1 Benefit from (provision for) income taxes 570.0 556.6 1,240.2 1,207.2 Net income Net income attributable to noncontrolling interests (see Note 8) (11.5) (5.6) (20.5) (20.1) $ 558.5 $ 551.0 $ 1,219.7 $ 1,187.1 Net income attributable to limited partners Earnings per unit: (see Note 10) Basic earnings per unit $ 0.27 $ 0.28 $ 0.59 $ 0.61 Diluted earnings per unit $ 0.27 $ 0.28 $ 0.59 $ 0.60 See Notes to Unaudited Condensed Consolidated Financial Statements. 3
Table of Contents ENTERPRISE PRODUCTS PARTNERS L.P. UNAUDITED CONDENSED STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME (Dollars in millions) For the Three Months For the Six Months Ended June 30, Ended June 30, 2016 2015 2016 2015 Net income $ 570.0 $ 556.6 $ 1,240.2 $ 1,207.2 Other comprehensive income (loss): Cash flow hedges: Commodity derivative instruments: Changes in fair value of cash flow hedges (73.7) (4.3) (74.9) 26.5 35.4 (20.2) (21.8) Reclassification of losses (gains) to net income (81.3) Interest rate derivative instruments: (9.4) -- (9.4) -- Changes in fair value of cash flow hedges Reclassification of losses to net income 9.2 8.7 18.4 17.4 Total cash flow hedges (38.5) (15.8) (87.7) (37.4) -- 0.4 (0.1) 0.4 Other (38.5) (15.4) (87.8) Total other comprehensive loss (37.0) Comprehensive income 531.5 541.2 1,152.4 1,170.2 (11.5) (5.6) (20.5) Comprehensive income attributable to noncontrolling interests (20.1) $ 520.0 $ 535.6 $ 1,131.9 $ 1,150.1 Comprehensive income attributable to limited partners See Notes to Unaudited Condensed Consolidated Financial Statements. 4
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