What Is Going On With Energy Transfer Equity LP (NYSE:ETE)?

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In the last trading session, the stock price of Energy Transfer Equity LP (NYSE:ETE) gained more than 1% to close the day at $16.70. The gains came at a share volume of 9.11 million compared to average share volume of 4.88 million.

The details

Energy Transfer issued financial report for the quarter closed September 30, 2017 in the last month. Net income attributable to associates was $252 million for the quarter closed September 30, 2017 versus $209 million for the same period, a year ago. Distributable Cash Flow for the reported quarter came at $271 million versus $281 million for the quarter closed September 30, 2016.

The drop in Distributable Cash Flow is mainly led by a decline in incentive distributions as initially agreed to between Energy Transfer Partners, L.P. and Energy Transfer Equity. These incentive delivery waivers, the bulk of which were originally offered to boost ETP’s funding of its growth capital assignments, are planned to lower considerably as ETP’s assignments are completed and increased in the near term.

In October 2017, Energy Transfer issued $1 billion aggregate principal sum of 4.25% senior notes to be paid 2023. The amount of $990 million from this offering is planned to be utilized to repay a part of the outstanding obligation under its term loan facility. Net proceeds will also be used for general partnership purposes.

This October, the company amended its prevailing senior secured term loan deal to lower the appropriate margin for LIBOR rate loans to 2% from 2.75% and for base rate loans 1.75% – 1%. The company reported a $0.295 distribution a ETE common unit for the three months closed September 30, 2017. As of the close of September 30, 2017, Energy Transfer’s $1.5 billion revolving credit facility recorded $1.19 billion of due borrowings. Its leverage ratio, as stated by the credit deal, was 3.45x.

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