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Business Segments | 3 Months Ended
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Mar. 31, 2013
Business Segments [Abstract] |
Business Segments | Note 11. Business Segments We have five reportable business segments: (i) NGL Pipelines & Services; (ii) Onshore Natural Gas Pipelines & Services; (iii) Onshore Crude Oil Pipelines & Services; (iv) Offshore Pipelines & Services; and (v) Petrochemical & Refined Products Services. Our business segments are generally organized and managed according to the types of services rendered (or technologies employed) and products produced and/or sold. All activities included in our former sixth reportable business segment, Other Investments, ceased on January 18, 2012, which was the date we discontinued using the equity method to account for our previously held investment in Energy Transfer Equity. See Note 7 for information regarding the liquidation of our investment in Energy Transfer Equity. We evaluate segment performance based on the non-GAAP financial measure of gross operating margin. Gross operating margin (either in total or by individual segment) is an important performance measure of the core profitability of our operations. This measure forms the basis of our internal financial reporting and is used by our management in deciding how to allocate capital resources among business segments. We believe that investors benefit from having access to the same financial measures that our management uses in evaluating segment results. The GAAP financial measure most directly comparable to total segment gross operating margin is operating income. Our non-GAAP financial measure of total segment gross operating margin should not be considered an alternative to GAAP operating income. We define total segment gross operating margin as operating income before: (i) depreciation, amortization and accretion expenses; (ii) non-cash asset impairment charges; (iii) gains and losses attributable to asset sales and insurance recoveries; and (iv) general and administrative costs. Gross operating margin by segment is calculated by subtracting segment operating costs and expenses (net of the adjustments noted above) from segment revenues, with both segment totals before the elimination of intercompany transactions. In accordance with GAAP, intercompany accounts and transactions are eliminated in the preparation of our consolidated financial statements. Gross operating margin is exclusive of other income and expense transactions, income taxes, the cumulative effect of changes in accounting principles and extraordinary charges. Gross operating margin is presented on a 100% basis before any allocation of earnings to noncontrolling interests. We include equity in income of unconsolidated affiliates in our measurement of segment gross operating margin and operating income. Equity investments with industry partners are a significant component of our business strategy. They are a means by which we conduct our operations to align our interests with those of customers and/or suppliers. This method of operation enables us to achieve favorable economies of scale relative to the level of investment and business risk assumed. Many of these businesses perform supporting or complementary roles to our other midstream business operations. The following table presents our measurement of total segment gross operating margin for the periods indicated:
|  | For the Three Months Ended March 31, |
|  | 2013 |  |  | 2012 |
Revenues |  | $ | 11,383.1 |  |  | $ | 11,252.5 |
Less: Operating costs and expenses |  |  | (10,420.4 | ) |  |  | (10,467.2 | )
Add: Equity in income of unconsolidated affiliates |  |  | 44.5 |  |  |  | 9.9 |
Depreciation, amortization and accretion recorded in operating costs and expenses |  |  | 276.8 |  |  |  | 254.6 |
Non-cash asset impairment charges recorded in operating costs and expenses |  |  | 11.0 |  |  |  | 5.4 |
Gains attributable to asset sales and insurance recoveries recorded in operating costs and expenses |  |  | (63.9 | ) |  |  | (2.5 | )
Total segment gross operating margin |  | $ | 1,231.1 |  |  | $ | 1,052.7 |
The following table presents a reconciliation of total segment gross operating margin to operating income and further to income before income taxes for the periods indicated:
|  | For the Three Months Ended March 31, |
|  | 2013 |  |  | 2012 |
Total segment gross operating margin |  | $ | 1,231.1 |  |  | $ | 1,052.7 |
Adjustments to reconcile total segment gross operating margin to operating income: |  |  |  |  |  |  |  |
Amounts included in operating costs and expenses: |  |  |  |  |  |  |  |
Depreciation, amortization and accretion |  |  | (276.8 | ) |  |  | (254.6 | )
Non-cash asset impairment charges |  |  | (11.0 | ) |  |  | (5.4 | )
Gains attributable to asset sales and insurance recoveries |  |  | 63.9 |  |  |  | 2.5 |
General and administrative costs |  |  | (49.5 | ) |  |  | (46.3 | )
Operating income |  |  | 957.7 |  |  |  | 748.9 |
Other expense, net |  |  | (196.0 | ) |  |  | (127.8 | )
Income before income taxes |  | $ | 761.7 |  |  | $ | 621.1 |
Information by business segment, together with reconciliations to our consolidated financial statement totals, is presented in the following table:
|  | Reportable Business Segments |  |  |  |  |  |  |
|  |  |  |  | Onshore |  |  | Onshore |  |  |  |  |  | Petrochemical |  |  |  |  |  |  |  |  |  |
|  | NGL |  |  | Natural Gas |  |  | Crude Oil |  |  | Offshore |  |  | & Refined |  |  |  |  |  | Adjustments |  |  |  |
|  | Pipelines |  |  | Pipelines |  |  | Pipelines |  |  | Pipelines |  |  | Products |  |  | Other |  |  | and |  |  | Consolidated |
|  | & Services |  |  | & Services |  |  | & Services |  |  | & Services |  |  | Services |  |  | Investments |  |  | Eliminations |  |  | Totals |
Revenues from third parties: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2013 |  | $ | 3,950.7 |  |  | $ | 874.2 |  |  | $ | 4,793.2 |  |  | $ | 40.5 |  |  | $ | 1,718.6 |  |  | $ | -- |  |  | $ | -- |  |  | $ | 11,377.2 |
Three months ended March 31, 2012 |  |  | 4,354.1 |  |  |  | 804.9 |  |  |  | 4,473.6 |  |  |  | 54.4 |  |  |  | 1,534.7 |  |  |  | -- |  |  |  | -- |  |  |  | 11,221.7 |
Revenues from related parties: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2013 |  |  | 0.3 |  |  |  | 3.5 |  |  |  | -- |  |  |  | 2.1 |  |  |  | -- |  |  |  | -- |  |  |  | -- |  |  |  | 5.9 |
Three months ended March 31, 2012 |  |  | 0.4 |  |  |  | 28.7 |  |  |  | -- |  |  |  | 1.7 |  |  |  | -- |  |  |  | -- |  |  |  | -- |  |  |  | 30.8 |
Intersegment and intrasegment revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2013 |  |  | 2,709.0 |  |  |  | 256.2 |  |  |  | 2,024.7 |  |  |  | 2.0 |  |  |  | 422.1 |  |  |  | -- |  |  |  | (5,414.0 | ) |  |  | -- |
Three months ended March 31, 2012 |  |  | 2,818.2 |  |  |  | 223.7 |  |  |  | 1,730.9 |  |  |  | 3.3 |  |  |  | 439.9 |  |  |  | -- |  |  |  | (5,216.0 | ) |  |  | -- |
Total revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2013 |  |  | 6,660.0 |  |  |  | 1,133.9 |  |  |  | 6,817.9 |  |  |  | 44.6 |  |  |  | 2,140.7 |  |  |  | -- |  |  |  | (5,414.0 | ) |  |  | 11,383.1 |
Three months ended March 31, 2012 |  |  | 7,172.7 |  |  |  | 1,057.3 |  |  |  | 6,204.5 |  |  |  | 59.4 |  |  |  | 1,974.6 |  |  |  | -- |  |  |  | (5,216.0 | ) |  |  | 11,252.5 |
Equity in income (loss) of unconsolidated affiliates: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2013 |  |  | 3.9 |  |  |  | 1.0 |  |  |  | 36.6 |  |  |  | 6.4 |  |  |  | (3.4 | ) |  |  | -- |  |  |  | -- |  |  |  | 44.5 |
Three months ended March 31, 2012 |  |  | 5.2 |  |  |  | 1.4 |  |  |  | 0.5 |  |  |  | 6.9 |  |  |  | (6.5 | ) |  |  | 2.4 |  |  |  | -- |  |  |  | 9.9 |
Gross operating margin: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2013 |  |  | 592.5 |  |  |  | 190.8 |  |  |  | 236.4 |  |  |  | 40.5 |  |  |  | 170.9 |  |  |  | -- |  |  |  | -- |  |  |  | 1,231.1 |
Three months ended March 31, 2012 |  |  | 654.9 |  |  |  | 206.2 |  |  |  | 39.3 |  |  |  | 52.1 |  |  |  | 97.8 |  |  |  | 2.4 |  |  |  | -- |  |  |  | 1,052.7 |
Property, plant and equipment, net: (see Note 6) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2013 |  |  | 9,059.1 |  |  |  | 8,942.0 |  |  |  | 1,359.0 |  |  |  | 1,323.5 |  |  |  | 2,548.4 |  |  |  | -- |  |  |  | 1,990.5 |  |  |  | 25,222.5 |
At December 31, 2012 |  |  | 8,494.8 |  |  |  | 8,950.1 |  |  |  | 1,385.9 |  |  |  | 1,343.0 |  |  |  | 2,559.5 |  |  |  | -- |  |  |  | 2,113.1 |  |  |  | 24,846.4 |
Investments in unconsolidated affiliates: (see Note 7) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2013 |  |  | 412.1 |  |  |  | 24.6 |  |  |  | 660.3 |  |  |  | 509.0 |  |  |  | 73.0 |  |  |  | -- |  |  |  | -- |  |  |  | 1,679.0 |
At December 31, 2012 |  |  | 324.6 |  |  |  | 24.9 |  |  |  | 493.8 |  |  |  | 479.0 |  |  |  | 72.3 |  |  |  | -- |  |  |  | -- |  |  |  | 1,394.6 |
Intangible assets, net: (see Note 8) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2013 |  |  | 311.0 |  |  |  | 1,055.5 |  |  |  | 5.6 |  |  |  | 63.1 |  |  |  | 104.6 |  |  |  | -- |  |  |  | -- |  |  |  | 1,539.8 |
At December 31, 2012 |  |  | 320.6 |  |  |  | 1,067.9 |  |  |  | 5.9 |  |  |  | 66.2 |  |  |  | 106.2 |  |  |  | -- |  |  |  | -- |  |  |  | 1,566.8 |
Goodwill: (see Note 8) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2013 |  |  | 341.2 |  |  |  | 296.3 |  |  |  | 311.2 |  |  |  | 82.1 |  |  |  | 1,055.3 |  |  |  | -- |  |  |  | -- |  |  |  | 2,086.1 |
At December 31, 2012 |  |  | 341.2 |  |  |  | 296.3 |  |  |  | 311.2 |  |  |  | 82.1 |  |  |  | 1,056.0 |  |  |  | -- |  |  |  | -- |  |  |  | 2,086.8 |
Segment assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2013 |  |  | 10,123.4 |  |  |  | 10,318.4 |  |  |  | 2,336.1 |  |  |  | 1,977.7 |  |  |  | 3,781.3 |  |  |  | -- |  |  |  | 1,990.5 |  |  |  | 30,527.4 |
At December 31, 2012 |  |  | 9,481.2 |  |  |  | 10,339.2 |  |  |  | 2,196.8 |  |  |  | 1,970.3 |  |  |  | 3,794.0 |  |  |  | -- |  |  |  | 2,113.1 |  |  |  | 29,894.6 |
The following table presents additional information regarding our consolidated revenues and costs and expenses for the periods indicated:
|  | For the Three Months Ended March 31, |
|  | 2013 |  |  | 2012 |
NGL Pipelines & Services: |  |  |  |  |  |
Sales of NGLs and related products |  | $ | 3,665.6 |  |  | $ | 4,115.3 |
Midstream services |  |  | 285.4 |  |  |  | 239.2 |
Total |  |  | 3,951.0 |  |  |  | 4,354.5 |
Onshore Natural Gas Pipelines & Services: |  |  |  |  |  |  |  |
Sales of natural gas |  |  | 639.5 |  |  |  | 572.6 |
Midstream services |  |  | 238.2 |  |  |  | 261.0 |
Total |  |  | 877.7 |  |  |  | 833.6 |
Onshore Crude Oil Pipelines & Services: |  |  |  |  |  |  |  |
Sales of crude oil |  |  | 4,742.8 |  |  |  | 4,447.6 |
Midstream services |  |  | 50.4 |  |  |  | 26.0 |
Total |  |  | 4,793.2 |  |  |  | 4,473.6 |
Offshore Pipelines & Services: |  |  |  |  |  |  |  |
Sales of natural gas |  |  | 0.1 |  |  |  | 0.1 |
Sales of crude oil |  |  | 2.3 |  |  |  | 1.4 |
Midstream services |  |  | 40.2 |  |  |  | 54.6 |
Total |  |  | 42.6 |  |  |  | 56.1 |
Petrochemical & Refined Products Services: |  |  |  |  |  |  |  |
Sales of petrochemicals and refined products |  |  | 1,547.2 |  |  |  | 1,351.2 |
Midstream services |  |  | 171.4 |  |  |  | 183.5 |
Total |  |  | 1,718.6 |  |  |  | 1,534.7 |
Total consolidated revenues |  | $ | 11,383.1 |  |  | $ | 11,252.5 |
Consolidated costs and expenses |  |  |  |  |  |  |  |
Operating costs and expenses: |  |  |  |  |  |  |  |
Cost of sales |  | $ | 9,692.5 |  |  | $ | 9,665.8 |
Other operating costs and expenses (1) |  |  | 504.0 |  |  |  | 543.9 |
Depreciation, amortization and accretion |  |  | 276.8 |  |  |  | 254.6 |
Gains attributable to asset sales and insurance recoveries |  |  | (63.9 | ) |  |  | (2.5 | )
Non-cash asset impairment charges |  |  | 11.0 |  |  |  | 5.4 |
General and administrative costs |  |  | 49.5 |  |  |  | 46.3 |
Total consolidated costs and expenses |  | $ | 10,469.9 |  |  | $ | 10,513.5 |
(1) Represents cost of operating our plants, pipelines and other fixed assets, excluding depreciation, amortization and accretion charges. |
Quarter-to-quarter fluctuations in our product sales revenues and related cost of sales amounts are explained in part by changes in energy commodity prices. In general, lower energy commodity prices result in a decrease in our revenues attributable to product sales; however, these lower commodity prices also decrease the associated cost of sales as purchase costs decline.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8864-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8906-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8933-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8984-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8538-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9054-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8595-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 131 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8981-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8971-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8844-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8924-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9031-108599 Reference 15: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9038-108599 + Details
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