XML 61 R17.htm IDEA: XBRL DOCUMENT
v3.20.1

Business Segments | 3 Months Ended
--- | ---
Mar. 31, 2020
Business Segments [Abstract] |
Business Segments | Note 10. Business Segments and Related Information Our operations are reported under four business segments: (i) NGL Pipelines & Services, (ii) Crude Oil Pipelines & Services, (iii) Natural Gas Pipelines & Services and (iv) Petrochemical & Refined Products Services. Segment Gross Operating Margin We evaluate segment performance based on our financial measure of gross operating margin. Gross operating margin is an important performance measure of the core profitability of our operations and forms the basis of our internal financial reporting. We believe that investors benefit from having access to the same financial measures that our management uses in evaluating segment results. 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. Our calculation of gross operating margin may or may not be comparable to similarly titled measures used by other companies. The following table presents our measurement of total segment gross operating margin for the periods presented. The GAAP financial measure most directly comparable to total segment gross operating margin is operating income.
|  | For the Three Months Ended March 31, |
|  | 2020 |  |  | 2019 |
Operating income |  | $ | 1,507.5 |  |  | $ | 1,626.2 |
Adjustments to reconcile operating income to total segment gross operating margin (addition or subtraction indicated by sign): |  |  |  |  |  |  |  |
Depreciation, amortization and accretion expense in operating costs and expenses |  |  | 482.8 |  |  |  | 450.9 |
Asset impairment and related charges in operating costs and expenses |  |  | 1.6 |  |  |  | 4.8 |
Net losses (gains) attributable to asset sales in operating costs and expenses |  |  | 0.1 |  |  |  | (0.4 | )
General and administrative costs |  |  | 55.5 |  |  |  | 52.2 |
Non-refundable payments received from shippers attributable to make-up rights (1) |  |  | 16.8 |  |  |  | 2.2 |
Subsequent recognition of revenues attributable to make-up rights (2) |  |  | (7.1 | ) |  |  | (7.5 | )
Total segment gross operating margin |  | $ | 2,057.2 |  |  | $ | 2,128.4 |
(1) | Since make-up rights entail a future performance obligation by the pipeline to the shipper, these receipts are recorded as deferred revenue for GAAP purposes; however, these receipts are included in gross operating margin in the period of receipt since they are nonrefundable to the shipper.
(2) | As deferred revenues attributable to make-up rights are subsequently recognized as revenue under GAAP, gross operating margin must be adjusted to remove such amounts to prevent duplication since the associated non-refundable payments were previously included in gross operating margin.
Gross operating margin by segment is calculated by subtracting segment operating costs and expenses from segment revenues, with both segment totals reflecting the adjustments noted in the preceding table, as applicable, and before the elimination of intercompany transactions. The following table presents gross operating margin by segment for the periods indicated:
|  | For the Three Months Ended March 31, |
|  | 2020 |  |  | 2019 |
Gross operating margin by segment: |  |  |  |  |  |
NGL Pipelines & Services |  | $ | 1,042.0 |  |  | $ | 959.2 |
Crude Oil Pipelines & Services |  |  | 452.9 |  |  |  | 662.3 |
Natural Gas Pipelines & Services |  |  | 283.8 |  |  |  | 264.3 |
Petrochemical & Refined Products Services |  |  | 278.5 |  |  |  | 242.6 |
Total segment gross operating margin |  | $ | 2,057.2 |  |  | $ | 2,128.4 |
The following table summarizes the non-cash mark-to-market gains (losses) included in gross operating margin for the periods indicated:
|  | For the Three Months Ended March 31, |
|  | 2020 |  |  | 2019 |
Mark-to-market gains (losses) in gross operating margin: |  |  |  |  |  |
NGL Pipelines & Services |  | $ | (12.3 | ) |  | $ | 1.3 |
Crude Oil Pipelines & Services |  |  | 10.7 |  |  |  | 99.8 |
Natural Gas Pipelines & Services |  |  | 28.8 |  |  |  | (0.3 | )
Petrochemical & Refined Products Services |  |  | 2.3 |  |  |  | (4.5 | )
Total mark-to-market impact on gross operating margin |  | $ | 29.5 |  |  | $ | 96.3 |
For information regarding our hedging activities, see Note 14. Summarized Segment Financial Information Information by business segment, together with reconciliations to amounts presented on our Unaudited Condensed Statements of Consolidated Operations, is presented in the following table:
|  | Reportable Business Segments |  |  |  |  |  |  |
|  | NGL Pipelines & Services |  |  | Crude Oil Pipelines & Services |  |  | Natural Gas Pipelines & Services |  |  | Petrochemical & Refined Products Services |  |  | Adjustments and Eliminations |  |  | Consolidated Total |
Revenues from third parties: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2020 |  | $ | 2,966.3 |  |  | $ | 2,027.7 |  |  | $ | 667.6 |  |  | $ | 1,804.9 |  |  | $ | – |  |  | $ | 7,466.5 |
Three months ended March 31, 2019 |  |  | 3,311.6 |  |  |  | 2,601.6 |  |  |  | 923.7 |  |  |  | 1,694.3 |  |  |  | – |  |  |  | 8,531.2 |
Revenues from related parties: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2020 |  |  | 1.8 |  |  |  | 11.2 |  |  |  | 3.0 |  |  |  | – |  |  |  | – |  |  |  | 16.0 |
Three months ended March 31, 2019 |  |  | 2.8 |  |  |  | 5.7 |  |  |  | 3.8 |  |  |  | – |  |  |  | – |  |  |  | 12.3 |
Intersegment and intrasegment revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2020 |  |  | 5,780.7 |  |  |  | 7,840.3 |  |  |  | 115.1 |  |  |  | 808.1 |  |  |  | (14,544.2 | ) |  |  | – |
Three months ended March 31, 2019 |  |  | 5,491.4 |  |  |  | 7,885.0 |  |  |  | 195.4 |  |  |  | 714.4 |  |  |  | (14,286.2 | ) |  |  | – |
Total revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2020 |  |  | 8,748.8 |  |  |  | 9,879.2 |  |  |  | 785.7 |  |  |  | 2,613.0 |  |  |  | (14,544.2 | ) |  |  | 7,482.5 |
Three months ended March 31, 2019 |  |  | 8,805.8 |  |  |  | 10,492.3 |  |  |  | 1,122.9 |  |  |  | 2,408.7 |  |  |  | (14,286.2 | ) |  |  | 8,543.5 |
Equity in income (loss) of unconsolidated affiliates: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Three months ended March 31, 2020 |  |  | 32.7 |  |  |  | 107.3 |  |  |  | 1.6 |  |  |  | (0.8 | ) |  |  | – |  |  |  | 140.8 |
Three months ended March 31, 2019 |  |  | 30.1 |  |  |  | 124.6 |  |  |  | 1.7 |  |  |  | (1.8 | ) |  |  | – |  |  |  | 154.6 |
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. Information by business segment, together with reconciliations to our Unaudited Condensed Consolidated Balance Sheet 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 |  |  | Adjustments and Eliminations |  |  | Consolidated Total |
Property, plant and equipment, net: (see Note 4) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2020 |  | $ | 16,997.8 |  |  | $ | 6,340.2 |  |  | $ | 8,433.6 |  |  | $ | 7,570.1 |  |  | $ | 2,817.4 |  |  | $ | 42,159.1 |
At December 31, 2019 |  |  | 16,652.1 |  |  |  | 6,324.4 |  |  |  | 8,432.5 |  |  |  | 7,553.2 |  |  |  | 2,641.2 |  |  |  | 41,603.4 |
Investments in unconsolidated affiliates: (see Note 5) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2020 |  |  | 699.1 |  |  |  | 1,877.5 |  |  |  | 27.9 |  |  |  | 4.0 |  |  |  | – |  |  |  | 2,608.5 |
At December 31, 2019 |  |  | 703.8 |  |  |  | 1,866.5 |  |  |  | 27.3 |  |  |  | 2.6 |  |  |  | – |  |  |  | 2,600.2 |
Intangible assets, net: (see Note 6) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2020 |  |  | 353.7 |  |  |  | 1,981.0 |  |  |  | 931.0 |  |  |  | 143.7 |  |  |  | – |  |  |  | 3,409.4 |
At December 31, 2019 |  |  | 360.2 |  |  |  | 2,001.9 |  |  |  | 941.2 |  |  |  | 145.7 |  |  |  | – |  |  |  | 3,449.0 |
Goodwill: (see Note 6) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2020 |  |  | 2,651.7 |  |  |  | 1,841.0 |  |  |  | 296.3 |  |  |  | 956.2 |  |  |  | – |  |  |  | 5,745.2 |
At December 31, 2019 |  |  | 2,651.7 |  |  |  | 1,841.0 |  |  |  | 296.3 |  |  |  | 956.2 |  |  |  | – |  |  |  | 5,745.2 |
Segment assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
At March 31, 2020 |  |  | 20,702.3 |  |  |  | 12,039.7 |  |  |  | 9,688.8 |  |  |  | 8,674.0 |  |  |  | 2,817.4 |  |  |  | 53,922.2 |
At December 31, 2019 |  |  | 20,367.8 |  |  |  | 12,033.8 |  |  |  | 9,697.3 |  |  |  | 8,657.7 |  |  |  | 2,641.2 |  |  |  | 53,397.8 |
Supplemental Revenue and Expense Information 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, |
|  | 2020 |  |  | 2019 |
Consolidated revenues: |  |  |  |  |  |
NGL Pipelines & Services |  | $ | 2,968.1 |  |  | $ | 3,314.4 |
Crude Oil Pipelines & Services |  |  | 2,038.9 |  |  |  | 2,607.3 |
Natural Gas Pipelines & Services |  |  | 670.6 |  |  |  | 927.5 |
Petrochemical & Refined Products Services |  |  | 1,804.9 |  |  |  | 1,694.3 |
Total consolidated revenues |  | $ | 7,482.5 |  |  | $ | 8,543.5 |
Consolidated costs and expenses |  |  |  |  |  |  |  |
Operating costs and expenses: |  |  |  |  |  |  |  |
Cost of sales |  | $ | 4,823.0 |  |  | $ | 5,835.6 |
Other operating costs and expenses (1) |  |  | 752.8 |  |  |  | 728.8 |
Depreciation, amortization and accretion |  |  | 482.8 |  |  |  | 450.9 |
Asset impairment and related charges |  |  | 1.6 |  |  |  | 4.8 |
Net losses (gains) attributable to asset sales |  |  | 0.1 |  |  |  | (0.4 | )
General and administrative costs |  |  | 55.5 |  |  |  | 52.2 |
Total consolidated costs and expenses |  | $ | 6,115.8 |  |  | $ | 7,071.9 |
(1) | Represents the cost of operating our plants, pipelines and other fixed assets excluding: depreciation, amortization and accretion charges; asset impairment and related charges; and net losses (or gains) attributable to asset sales.
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 are lower. The same type of 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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration