Enterprise Products Partners L.P.

Enterprise reported second-quarter 2026 EBITDA of a record $2.8 billion, up 17% year over year, and adjusted cash flow from operations of a record $2.5 billion, up 19% versus the same quarter last year. The company said total pipeline volumes were up 8%, marine terminal volumes were up 33%, oil-equivalent throughput was 14.7 million barrels per day, and natural gas processing inlet volumes were 8.1 billion cubic feet per day, including Permian inlet volumes of 4.3 billion cubic feet per day, up 14% year over year. The quarterly distribution was raised to $0.56 per common unit, up 2.8% year over year, and the payout ratio of adjusted cash flow from operations was 56%. For 2026, gross capital expenditures are expected to net to $2.9 billion to $3.4 billion after about $600 million of asset-sale proceeds already received, sustaining capital is expected to be about $600 million, and discretionary free cash flow is still expected to approach $1 billion. For 2027, growth capital expenditures are expected to be in the $3 billion area. The company ended the quarter with about $33.5 billion of debt principal outstanding, about $4 billion of liquidity before a newly added $1 billion short-term credit facility, and a net leverage ratio at the 3.0 target.

Jim Teague said the quarter reflected strong global demand for U.S. energy and exceptional execution by Enterprise's operations teams. He emphasized the company's flexibility across its integrated network from wellhead to export markets, saying that reliability and optionality are becoming even more valuable in volatile markets. His tone was upbeat and reflective, especially as he discussed retirement, but he remained confident that the business is well positioned for growth thanks to strong demand, a strong balance sheet, and a disciplined capital program.

Randy Fowler focused on cash generation, capital spending, leverage, and shareholder returns. He cited record adjusted cash flow from operations of $2.5 billion, $159 million of unit repurchases in the quarter, $275 million bought back in the first half, and $404 million over the last 12 months, with cumulative utilization of the $5 billion buyback program at 34%. He said total capital investments were $1.2 billion in the quarter, 2026 gross capex is expected to net to $2.9 billion to $3.4 billion after asset-sale proceeds, sustaining capex is about $600 million, and the company still sees 2026 discretionary free cash flow approaching $1 billion despite more than $700 million of added growth capex since the start of the year. He also noted about $33.5 billion of debt, a 4.7% weighted average cost of debt, about 97% fixed-rate debt, roughly $5 billion of liquidity after a new $1 billion facility, and leverage at the 3.0 target on a net basis.

Analysts pressed management on LPG export capacity coming online, and Tyler Cott said the market will likely need time to absorb new supply, which could mean lower terminal fees, but Enterprise is about 90% contracted on LPG export capacity and has limited exposure. Questions on Waha and Permian gas shut-ins drew a response that much of the gas was choked back rather than permanently lost, and management expects some of it to return as pricing and pipeline capacity normalize. On capital spending, Randy Fowler said 2027 may be a new near-term level at about $3 billion, with more than 80% already spoken for. Management also said ATEX recontracting is still a dynamic discussion because current tariffs often exceed the value of the product moved, implying a rate reset may be needed.