XML 30 R16.htm IDEA: XBRL DOCUMENT
v3.4.0.3

Business Segments | 3 Months Ended
--- | ---
Mar. 31, 2016
Business Segments [Abstract] |
Business Segments | Note 9. Business Segments Our historical operations are reported under five business segments: (i) NGL Pipelines & Services, (ii) Crude Oil Pipelines & Services, (iii) Natural Gas Pipelines & Services, (iv) Petrochemical & Refined Products Services and (v) Offshore Pipelines & 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. Our consolidated financial statements reflect ownership of the Offshore Business through July 24, 2015, which was the closing date of the sales transaction. Segment revenues include intersegment and intrasegment transactions, which are generally based on transactions made at market-based rates. Our consolidated revenues reflect the elimination of intercompany transactions. Substantially all of our consolidated revenues are earned in the U.S. and derived from a wide customer base. 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 executive 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. In total, gross operating margin represents operating income exclusive of (1) depreciation, amortization and accretion expenses, (2) impairment charges, (3) gains and losses attributable to asset sales and (4) general and administrative costs. Gross operating margin includes equity in income of unconsolidated affiliates and non-refundable deferred transportation revenues relating to the make-up rights of committed shippers associated with certain pipelines. 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 consolidation. 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. Segment assets consist of property, plant and equipment, investments in unconsolidated affiliates, intangible assets and goodwill. The carrying values of such amounts are assigned to each segment based on each asset's or investment's principal operations and contribution to the gross operating margin of that particular segment. Since construction-in-progress amounts (a component of property, plant and equipment) generally do not contribute to segment gross operating margin, such amounts are excluded from segment asset totals until the underlying assets are placed in service. Intangible assets and goodwill are assigned to each segment based on the classification of the assets to which they relate. Substantially all of our plants, pipelines and other fixed assets are located in the U.S. The remainder of our consolidated total assets, which consist primarily of working capital assets, are excluded from segment assets since these amounts are not attributable to one specific segment (e.g. cash). The following table presents our measurement of non-GAAP total segment gross operating margin for the periods indicated:
|  | For the Three Months Ended March 31, |
|  | 2016 |  |  | 2015 |
Revenues |  | $ | 5,005.3 |  |  | $ | 7,472.5 |
Subtract operating costs and expenses |  |  | (4,146.9 | ) |  |  | (6,616.4 | )
Add equity in income of unconsolidated affiliates |  |  | 101.1 |  |  |  | 89.2 |
Add depreciation, amortization and accretion expense amounts not reflected in gross operating margin |  |  | 358.2 |  |  |  | 345.3 |
Add impairment charges not reflected in gross operating margin |  |  | 1.7 |  |  |  | 33.3 |
Add net losses or subtract net gains attributable to asset sales not reflected in gross operating margin |  |  | 4.9 |  |  |  | (0.1 | )
Add non-refundable deferred revenues attributable to shipper make-up rights on major new pipeline projects reflected in gross operating margin |  |  | 7.1 |  |  |  | 30.7 |
Subtract subsequent recognition of deferred revenues attributable to make-up rights not reflected in gross operating margin |  |  | (12.9 | ) |  |  | (20.1 | )
Total segment gross operating margin |  | $ | 1,318.5 |  |  | $ | 1,334.4 |
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, |
|  | 2016 |  |  | 2015 |
Total segment gross operating margin |  | $ | 1,318.5 |  |  | $ | 1,334.4 |
Adjustments to reconcile total segment gross operating margin to operating income: |  |  |  |  |  |  |  |
Subtract depreciation, amortization and accretion expense amounts not reflected in gross operating margin |  |  | (358.2 | ) |  |  | (345.3 | )
Subtract impairment charges not reflected in gross operating margin |  |  | (1.7 | ) |  |  | (33.3 | )
Add net gains or subtract net losses attributable to asset sales not reflected in gross operating margin |  |  | (4.9 | ) |  |  | 0.1 |
Subtract non-refundable deferred revenues attributable to shipper make-up rights on major new pipeline projects reflected in gross operating margin |  |  | (7.1 | ) |  |  | (30.7 | )
Add subsequent recognition of deferred revenues attributable to make-up rights not reflected in gross operating margin |  |  | 12.9 |  |  |  | 20.1 |
Subtract general and administrative costs not reflected in gross operating margin |  |  | (43.9 | ) |  |  | (49.3 | )
Operating income |  |  | 915.6 |  |  |  | 896.0 |
Other expense, net |  |  | (237.0 | ) |  |  | (238.6 | )
Income before income taxes |  | $ | 678.6 |  |  | $ | 657.4 |
Information by business segment, together with reconciliations to our consolidated financial statement totals, is presented in the following table:
|  | Reportable Business Segments |  |  |  |  |  |  |
|  | NGL Pipelines & Services |  |  | Crude Oil Pipelines & Services |  |  | Natural Gas Pipelines & Services |  |  | Petrochemical & Refined Products Services |  |  | Offshore Pipelines & Services |  |  | Adjustments and Eliminations |  |  | Consolidated Total |
Revenues from third parties: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2016 |  | $ | 2,402.0 |  |  | $ | 1,277.5 |  |  | $ | 547.3 |  |  | $ | 762.9 |  |  | $ | -- |  |  | $ | -- |  |  | $ | 4,989.7 |
Three months ended March 31, 2015 |  |  | 2,674.8 |  |  |  | 2,677.0 |  |  |  | 730.9 |  |  |  | 1,349.1 |  |  |  | 34.6 |  |  |  | -- |  |  |  | 7,466.4 |
Revenues from related parties: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2016 |  |  | 1.8 |  |  |  | 11.1 |  |  |  | 2.7 |  |  |  | -- |  |  |  | -- |  |  |  | -- |  |  |  | 15.6 |
Three months ended March 31, 2015 |  |  | 1.5 |  |  |  | 1.0 |  |  |  | 3.0 |  |  |  | -- |  |  |  | 0.6 |  |  |  | -- |  |  |  | 6.1 |
Intersegment and intrasegment revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2016 |  |  | 3,174.8 |  |  |  | 1,499.4 |  |  |  | 124.7 |  |  |  | 242.7 |  |  |  | -- |  |  |  | (5,041.6 | ) |  |  | -- |
Three months ended March 31, 2015 |  |  | 2,443.1 |  |  |  | 1,277.1 |  |  |  | 170.0 |  |  |  | 285.6 |  |  |  | 0.4 |  |  |  | (4,176.2 | ) |  |  | -- |
Total revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2016 |  |  | 5,578.6 |  |  |  | 2,788.0 |  |  |  | 674.7 |  |  |  | 1,005.6 |  |  |  | -- |  |  |  | (5,041.6 | ) |  |  | 5,005.3 |
Three months ended March 31, 2015 |  |  | 5,119.4 |  |  |  | 3,955.1 |  |  |  | 903.9 |  |  |  | 1,634.7 |  |  |  | 35.6 |  |  |  | (4,176.2 | ) |  |  | 7,472.5 |
Equity in income (loss) of unconsolidated affiliates: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2016 |  |  | 15.1 |  |  |  | 90.1 |  |  |  | 1.0 |  |  |  | (5.1 | ) |  |  | -- |  |  |  | -- |  |  |  | 101.1 |
Three months ended March 31, 2015 |  |  | 11.6 |  |  |  | 59.9 |  |  |  | 0.9 |  |  |  | (3.4 | ) |  |  | 20.2 |  |  |  | -- |  |  |  | 89.2 |
Gross operating margin: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2016 |  |  | 783.7 |  |  |  | 202.3 |  |  |  | 177.7 |  |  |  | 154.8 |  |  |  | -- |  |  |  | -- |  |  |  | 1,318.5 |
Three months ended March 31, 2015 |  |  | 695.2 |  |  |  | 214.0 |  |  |  | 204.5 |  |  |  | 174.6 |  |  |  | 46.1 |  |  |  | -- |  |  |  | 1,334.4 |
Property, plant and equipment, net: (see Note 4) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2016 |  |  | 12,934.9 |  |  |  | 3,896.6 |  |  |  | 8,551.1 |  |  |  | 3,203.3 |  |  |  | -- |  |  |  | 4,087.4 |  |  |  | 32,673.3 |
At December 31, 2015 |  |  | 12,909.7 |  |  |  | 3,550.3 |  |  |  | 8,620.0 |  |  |  | 3,060.7 |  |  |  | -- |  |  |  | 3,894.0 |  |  |  | 32,034.7 |
Investments in unconsolidated affiliates: (see Note 5) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2016 |  |  | 740.1 |  |  |  | 1,848.6 |  |  |  | 22.3 |  |  |  | 73.1 |  |  |  | -- |  |  |  | -- |  |  |  | 2,684.1 |
At December 31, 2015 |  |  | 718.7 |  |  |  | 1,813.4 |  |  |  | 22.5 |  |  |  | 73.9 |  |  |  | -- |  |  |  | -- |  |  |  | 2,628.5 |
Intangible assets, net: (see Note 6) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2016 |  |  | 372.5 |  |  |  | 2,349.8 |  |  |  | 1,079.1 |  |  |  | 189.5 |  |  |  | -- |  |  |  | -- |  |  |  | 3,990.9 |
At December 31, 2015 |  |  | 380.3 |  |  |  | 2,377.5 |  |  |  | 1,087.7 |  |  |  | 191.7 |  |  |  | -- |  |  |  | -- |  |  |  | 4,037.2 |
Goodwill: (see Note 6) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2016 |  |  | 2,651.7 |  |  |  | 1,841.0 |  |  |  | 296.3 |  |  |  | 956.2 |  |  |  | -- |  |  |  | -- |  |  |  | 5,745.2 |
At December 31, 2015 |  |  | 2,651.7 |  |  |  | 1,841.0 |  |  |  | 296.3 |  |  |  | 956.2 |  |  |  | -- |  |  |  | -- |  |  |  | 5,745.2 |
Segment assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2016 |  |  | 16,699.2 |  |  |  | 9,936.0 |  |  |  | 9,948.8 |  |  |  | 4,422.1 |  |  |  | -- |  |  |  | 4,087.4 |  |  |  | 45,093.5 |
At December 31, 2015 |  |  | 16,660.4 |  |  |  | 9,582.2 |  |  |  | 10,026.5 |  |  |  | 4,282.5 |  |  |  | -- |  |  |  | 3,894.0 |  |  |  | 44,445.6 |
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, |
|  | 2016 |  |  | 2015 |
NGL Pipelines & Services: |  |  |  |  |  |
Sales of NGLs and related products |  | $ | 1,943.5 |  |  | $ | 2,242.2 |
Midstream services |  |  | 460.3 |  |  |  | 434.1 |
Total |  |  | 2,403.8 |  |  |  | 2,676.3 |
Crude Oil Pipelines & Services: |  |  |  |  |  |  |  |
Sales of crude oil |  |  | 1,121.1 |  |  |  | 2,570.7 |
Midstream services |  |  | 167.5 |  |  |  | 107.3 |
Total |  |  | 1,288.6 |  |  |  | 2,678.0 |
Natural Gas Pipelines & Services: |  |  |  |  |  |  |  |
Sales of natural gas |  |  | 315.0 |  |  |  | 476.3 |
Midstream services |  |  | 235.0 |  |  |  | 257.6 |
Total |  |  | 550.0 |  |  |  | 733.9 |
Petrochemical & Refined Products Services: |  |  |  |  |  |  |  |
Sales of petrochemicals and refined products |  |  | 553.2 |  |  |  | 1,151.0 |
Midstream services |  |  | 209.7 |  |  |  | 198.1 |
Total |  |  | 762.9 |  |  |  | 1,349.1 |
Offshore Pipelines & Services: |  |  |  |  |  |  |  |
Sales of crude oil |  |  | -- |  |  |  | 1.1 |
Midstream services |  |  | -- |  |  |  | 34.1 |
Total |  |  | -- |  |  |  | 35.2 |
Total consolidated revenues |  | $ | 5,005.3 |  |  | $ | 7,472.5 |
Consolidated costs and expenses |  |  |  |  |  |  |  |
Operating costs and expenses: |  |  |  |  |  |  |  |
Cost of sales |  | $ | 3,208.3 |  |  | $ | 5,678.1 |
Other operating costs and expenses (1) |  |  | 573.8 |  |  |  | 559.8 |
Depreciation, amortization and accretion |  |  | 358.2 |  |  |  | 345.3 |
Net losses (gains) attributable to asset sales |  |  | 4.9 |  |  |  | (0.1 | )
Non-cash asset impairment charges |  |  | 1.7 |  |  |  | 33.3 |
General and administrative costs |  |  | 43.9 |  |  |  | 49.3 |
Total consolidated costs and expenses |  | $ | 4,190.8 |  |  | $ | 6,665.7 |
(1)Represents cost of operating our plants, pipelines and other fixed assets, excluding depreciation, amortization and accretion charges. |
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. The same correlation would be true in the case of higher energy commodity sales prices and purchase costs.

X
- References No definition available. + Details
Name: | us-gaap_SegmentReportingAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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 34 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8981-108599 Reference 2: 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=51669610&loc=d3e9038-108599 Reference 3: 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=51669610&loc=d3e8971-108599 Reference 4: 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=51669610&loc=d3e8595-108599 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=51669610&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 32 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8933-108599 Reference 7: 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=51669610&loc=d3e8844-108599 Reference 8: 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=51669610&loc=d3e8984-108599 Reference 9: 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=51669610&loc=d3e9031-108599 Reference 10: 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=51669610&loc=d3e9054-108599 Reference 11: 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=51669610&loc=d3e8538-108599 Reference 12: 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=51669610&loc=d3e8864-108599 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=51669610&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 30 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8906-108599 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration