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Section 1: 8-K (8-K)

Document
false0001552000 0001552000 2019-10-31 2019-10-31


 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________________
FORM 8-K
_____________________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 31, 2019
 _____________________________________________
MPLX LP
(Exact name of registrant as specified in its charter)
_____________________________________________
Delaware
 
001-35714
 
27-0005456
(State or other jurisdiction
of incorporation)
 
(Commission File Number)
 
(IRS Employer
Identification No.)

200 E. Hardin Street, Findlay, Ohio 45840
(Address of principal executive offices) (Zip code)

Registrant’s telephone number, including area code: (419421-2414
_____________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
symbol(s)
Name of each exchange on which registered
Common Units Representing Limited Partnership Interests
MPLX
New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 





Item 2.02
Results of Operations and Financial Condition.
On October 31, 2019, MPLX LP ("MPLX") issued a press release announcing third-quarter 2019 earnings. The press release is being furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Information in this Item 2.02 and Exhibit 99.1 of Item 9.01 below shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise incorporated by reference into any filing pursuant to the Securities Act of 1933, as amended, or the Exchange Act except as otherwise expressly stated in such a filing.

Item 9.01
Financial Statements and Exhibits.
(d) Exhibits.

 
Exhibit Number
 
Description
 
 
 
 
 
Press Release dated October 31, 2019, issued by MPLX LP
104
 
Cover Page Interactive Data File (embedded within the Inline XBRL document)






SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
MPLX LP
 
 
 
 
 
 
 
By:
 
MPLX GP LLC, its General Partner
 
 
 
 
 
 
 
 
Date: October 31, 2019
By:
 
/s/ Pamela K. M. Beall
 
 
 
Name: Pamela K. M. Beall
 
 
 
Title: Executive Vice President and Chief Financial Officer



(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit
400742285_mplxearningslogoa02.jpg
MPLX LP Reports Third-Quarter 2019 Financial Results

Reported third quarter net income attributable to MPLX of $629 million; adjusted EBITDA attributable to MPLX of $1.2 billion, or $1.3 billion including full-quarter results of acquired business

Reported net cash provided by operating activities of $1.0 billion and 1.42x distribution coverage, which includes full-quarter results of acquired business

Targeting 2020 growth capital of approximately $2.0 billion

Completed acquisition of Andeavor Logistics on July 30

MPC announces formation of Midstream Special Committee

FINDLAY, Ohio, October 31, 2019 - MPLX LP (NYSE: MPLX) today reported third quarter 2019 net income attributable to MPLX of $629 million compared with $510 million for the third quarter of 2018. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) was $1.2 billion compared with $937 million in the third quarter of 2018.

On July 30, MPLX closed its acquisition of Andeavor Logistics (ANDX). Third quarter adjusted EBITDA attributable to MPLX, including full-quarter results of ANDX, would have been $1.3 billion. Logistics and Storage (L&S) reported segment income from operations of $713 million and adjusted EBITDA of $849 million for the quarter, up $245 million and $302 million, respectively, versus the third quarter of last year. Gathering and Processing (G&P) reported segment income from operations of $213 million and adjusted EBITDA of $424 million for the quarter, up $9 million and $34 million, respectively, on a year-over-year basis.

“During the quarter, we progressed our slate of high-return projects, advancing MPLX's strategy of creating integrated crude oil and natural gas logistics from the Permian to Gulf Coast markets," said Gary R. Heminger, chairman and chief executive officer. "Additionally, we moved forward with high-grading our growth capex portfolio and today announced a growth capital target of approximately $2.0 billion for 2020."

During the quarter, MPLX generated $1.0 billion in net cash provided by operating activities and distributable cash flow, including a full-quarter of results from ANDX, of $1.0 billion, which provided adjusted distribution coverage of 1.42x. MPLX also announced its 27th consecutive distribution increase to $0.6775 per common unit, a $0.01 increase over the prior quarter and a 6.3 percent increase over the prior year third quarter.


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Financial Highlights
 
 
Three Months Ended 
 Sept. 30
 
 
Nine Months Ended 
 Sept. 30
(In millions, except per unit and ratio data)
 
2019
 
 
2018
 
 
2019
 
 
2018
Net income attributable to MPLX
 
$
629

 
 
$
510

 
 
$
1,614

 
 
$
1,384

Adjusted net income attributable to MPLX(a)
 
681

 
 
N/A

 
 
2,015

 
 
N/A

Adjusted EBITDA attributable to MPLX LP (excluding predecessor results)(b)
 
1,165

 
 
937

 
 
3,015

 
 
2,564

Adjusted EBITDA attributable to MPLX LP (including predecessor results)(c)
 
1,273

 
 
N/A

 
 
3,785

 
 
N/A

Net cash provided by operating activities
 
1,036

 
 
737

 
 
2,990

 
 
2,027

Distributable cash flow attributable to MPLX LP(c)
 
1,027

 
 
766

 
 
3,055

 
 
2,080

Distribution per common unit(d)
 
$
0.6775

 
 
$
0.6375

 
 
$
2.0025

 
 
$
1.8825

Distribution coverage ratio(e)
 
1.42x

 
 
1.47x

 
 
1.54x

 
 
1.38x

Consolidated debt to adjusted EBITDA(f)
 
4.0x

 
 
3.8x

 
 
N/A

 
 
N/A

 
 
 
 
 
 
 
 
 
 
 
 
(a)
Includes net income attributable to predecessor for the three and nine months ended September 30, 2019.
(b)
Non-GAAP measure calculated before distributions to preferred unitholders. See reconciliation below. Excludes adjusted EBITDA attributable to predecessor.
(c)
Non-GAAP measure calculated before distributions to preferred unitholders. See reconciliation below. Includes adjusted EBITDA and DCF adjustments attributable to predecessor.
(d)
Distributions declared by the board of directors of MPLX's general partner.
(e)
DCF attributable to GP and LP unitholders (including DCF attributable to predecessor) divided by total GP and LP distribution declared.
(f)
Calculated using face value total debt and LTM pro forma adjusted EBITDA, which is pro forma for acquisitions. See reconciliation below.

Segment Results (including predecessor)
 
 
 
 
 
 
 
 
 
 
 
 
(In millions)
 
Three Months Ended 
 Sept. 30
 
 
Nine Months Ended 
 Sept. 30
Segment income from operations (unaudited)
 
2019
 
 
2018
 
 
2019
 
 
2018
Logistics and Storage
$
713

 
$
468

 
$
2,075

 
$
1,287

Gathering and Processing
 
213

 
 
204

 
 
648

 
 
550

 
 
 
 
 
 
 
 
 
 
 
 
Segment adjusted EBITDA attributable to MPLX LP (unaudited)
 
 
 
 
 
 
 
 
 
 
 
Logistics and Storage
 
849

 
 
547

 
 
2,498

 
 
1,510

Gathering and Processing
$
424

 
$
390

 
$
1,287

 
$
1,054

 
 
 
 
 
 
 
 
 
 
 
 

The operations acquired through the ANDX acquisition have been assigned to MPLX’s existing segments based on the nature of the assets and the services provided.

The L&S segment now includes: a network of crude oil and refined product pipelines; crude oil and water gathering systems; an inland marine business; terminals; rail facilities; storage caverns; refining logistics assets; and wholesale and fuels distribution services across the U.S.
The G&P segment now includes: systems and assets which gather, process, and fractionate natural gas and NGLs in key U.S. supply basins.


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Logistics & Storage

L&S segment income from operations and adjusted EBITDA for the third quarter of 2019 increased by $245 million and $302 million, respectively, compared with the same period in 2018. The increase was primarily due to the acquisition of ANDX and the continued solid performance of the underlying base business.

Total pipeline throughputs were 5.2 million barrels per day in the third quarter. The average tariff rate was $0.90 per barrel for the quarter. Terminal throughput was 3.3 million barrels per day for the quarter.

Gathering & Processing

G&P segment income from operations and segment adjusted EBITDA for the third quarter of 2019 increased by $9 million and $34 million, respectively, compared with the same period in 2018. Year-over-year results increased due to the ANDX acquisition and higher volumes partially offset by a significant decline in weighted average NGL prices. In the third quarter of 2019:
Gathered volumes: 6.3 billion cubic feet per day
Processed volumes: 8.8 billion cubic feet per day
Fractionated volumes: 547 thousand barrels per day

In the Marcellus and Utica, the company continued to experience significant year-over-year growth. Gathered volumes averaged 3.7 billion cubic feet per day (bcf/d) for the quarter, a 16 percent increase versus the third quarter of 2018. Processed volumes averaged 6.2 bcf/d, a 13 percent increase versus the same quarter last year, driven by high utilization across the company's Marcellus operations. Fractionated volumes averaged 482 thousand barrels per day, a 6 percent increase versus the third quarter of 2018. The increase was primarily driven by higher volumes at the expanded Hopedale Complex.
 
In the Southwest, gathered volumes averaged 1.7 bcf/d for the third quarter, a 3 percent increase versus the third quarter of 2018. Processed volumes averaged 1.7 bcf/d for the quarter, a 13 percent increase versus the third quarter of 2018. The increase was primarily the result of higher volumes in the Permian.

In the Bakken, gathered volumes averaged 149 mmcf/d for the third quarter. Processed volumes averaged 149 mmcf/d for the quarter.

In the Rockies, gathered volumes averaged 827 mmcf/d for the third quarter. Processed volumes averaged 568 mmcf/d for the quarter.

Strategic Update

MPC announced that it is forming a special committee of its Board of Directors, led by J. Mike Stice, to continue to evaluate alternatives to enhance value across its midstream business.

MPLX announced that it has completed its plan to high-grade its capital expenditures, focusing on the most attractive returns. For 2020, MPLX is targeting growth capex of approximately $2.0 billion.



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In the L&S segment, MPLX continues to advance its strategy of creating integrated crude oil and natural gas logistics systems from the Permian to the U.S. Gulf Coast. The Wink-to-Webster crude oil pipeline, in which MPLX has an equity interest, remains on schedule to be competed in the first half of 2021. The 36-inch diameter pipeline will originate in the Permian Basin and have destination points in the Houston market, including Marathon Petroleum Corporation's (NYSE: MPC) Galveston Bay refinery.

Also in the Permian, the Whistler Pipeline is being designed to transport approximately 2 billion cubic feet per day of natural gas from Waha, Texas to the Agua Dulce market in South Texas, ultimately reaching MPC’s Galveston Bay refinery. MPLX has an equity interest in Whistler, which is expected to be placed in service in the second half of 2021.

To support additional growth in the G&P segment, MPLX placed into service the Sherwood 12 and Torñado processing plants in October, adding 400 million cubic feet per day of capacity. The company expects to complete the Sherwood 13 processing plant late in the fourth quarter of 2019, adding another 200 million cubic feet per day of incremental capacity. Also, MPLX has two additional plants under various stages of development in the Permian.

Financial Position and Liquidity

As of September 30, 2019, MPLX had $41 million in cash, $3.5 billion available through its bank revolving credit facility expiring in July 2024, $1.4 billion available through its intercompany loan agreement with MPC, and $500 million of capacity available through its new bank term loan facility. The company's leverage ratio was 4.0x at September 30, 2019.

As a result of the completion of the ANDX acquisition, MPLX assumed an aggregate principal amount of $3.75 billion senior notes issued by ANDX. On September 23, 2019, approximately $3.06 billion aggregate principal amount of ANDX's outstanding senior notes were exchanged for new unsecured notes issued by MPLX having the same maturity and interest rates as the previously outstanding ANDX notes and cash as part of an exchange offer and consent solicitation undertaken by MPLX and ANDX.

During the quarter, MPLX also issued $2.0 billion aggregate principal amount of unsecured senior notes in an underwritten public offering consisting of $1.0 billion aggregate principal amount of floating rate senior notes due 2021 and $1.0 billion aggregate principal amount of floating rate senior notes due 2022. In addition, on September 26, 2019, MPLX entered into a term loan agreement with a syndicate of lenders providing for a committed term loan facility for up to an aggregate of $1.0 billion. MPLX borrowed $500 million under the term loan agreement during the quarter.

MPLX used a portion of the net proceeds from the notes offering and borrowings under the term loan agreement to repay the previously outstanding ANDX 5.500% senior notes due 2019 in the aggregate principal amount of $500 million at maturity on October 15, 2019 and to repay borrowings under its revolving credit facility and its intercompany loan agreement with MPC. The remainder of the proceeds from the notes offering and term loan borrowings have or will be used for general partnership purposes. MPLX remains committed to maintaining an investment-grade credit profile and a strategy of self-funding the equity portion of its organic growth capital needs.

Conference Call

At 11 a.m. EDT today, MPLX will hold a conference call and webcast to discuss the reported results and provide an update on operations. Interested parties may listen by visiting MPLX's


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website at http://www.mplx.com and clicking on the "2019 Third-Quarter Financial Results" link in the "News & Headlines" section. A replay of the webcast will be available on MPLX's website for two weeks. Financial information, including earnings release and other investor-related material, will also be available online prior to the conference call and webcast at http://ir.mplx.com.

About MPLX LP

MPLX is a diversified, large-cap master limited partnership that owns and operates midstream energy infrastructure and logistics assets, and provides fuels distribution services. MPLX's assets include a network of crude oil and refined product pipelines; an inland marine business; light-product terminals; storage caverns; refinery tanks, docks, loading racks, and associated piping; and crude and light-product marine terminals. The company also owns crude oil and natural gas gathering systems and pipelines as well as natural gas and NGL processing and fractionation facilities in key U.S. supply basins. More information is available at www.MPLX.com

Investor Relations Contacts: (419) 421-2071
Kristina Kazarian, Vice President, Investor Relations
Jim Mallamaci, Manager, Investor Relations
Evan Barbosa, Manager, Investor Relations

Media Contacts:
Hamish Banks, Vice President, Communications (419) 421-2521
Jamal Khiery, Manager, Communications (419) 421-3312

Non-GAAP references

In addition to our financial information presented in accordance with U.S. generally accepted accounting principles (GAAP), management utilizes additional non-GAAP measures to facilitate comparisons of past performance and future periods. This press release and supporting schedules include the non-GAAP measures adjusted EBITDA and consolidated debt to last twelve months pro forma adjusted EBITDA, which we refer to as our leverage ratio, distributable cash flow (DCF) and distribution coverage ratio. The amount of adjusted EBITDA and DCF generated is considered by the board of directors of our general partner in approving the Partnership's cash distribution. Adjusted EBITDA and DCF should not be considered separately from or as a substitute for net income, income from operations, or cash flow as reflected in our financial statements. The GAAP measures most directly comparable to adjusted EBITDA and DCF are net income and net cash provided by operating activities. We define Adjusted EBITDA as net income adjusted for (i) depreciation and amortization; (ii) provision for income taxes; (iii) amortization of deferred financing costs; (iv) non-cash equity-based compensation; (v) net interest and other financial costs; (vi) income from equity method investments; (vii) distributions and adjustments related to equity method investments; (viii) unrealized derivative gains and losses; (ix) acquisition costs; (x) noncontrolling interest and (xi) other adjustments as deemed necessary. In general, we define DCF as adjusted EBITDA adjusted for (i) deferred revenue impacts; (ii) net interest and other financial costs; (iii) maintenance capital expenditures; (iv) equity method investment capital expenditures paid out; and (v) other non-cash items.

The Partnership makes a distinction between realized or unrealized gains and losses on derivatives. During the period when a derivative contract is outstanding, we record changes in the fair value of the derivative as an unrealized gain or loss. When a derivative contract matures or is settled, we reverse the previously recorded unrealized gain or loss and record the realized gain or loss of the contract.



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Adjusted EBITDA is a financial performance measure used by management, industry analysts, investors, lenders, and rating agencies to assess the financial performance and operating results of our ongoing business operations. Additionally, we believe adjusted EBITDA provides useful information to investors for trending, analyzing and benchmarking our operating results from period to period as compared to other companies that may have different financing and capital structures.

DCF is a financial performance measure used by management as a key component in the determination of cash distributions paid to unitholders. We believe DCF is an important financial measure for unitholders as an indicator of cash return on investment and to evaluate whether the partnership is generating sufficient cash flow to support quarterly distributions. In addition, DCF is commonly used by the investment community because the market value of publicly traded partnerships is based, in part, on DCF and cash distributions paid to unitholders.

Distribution coverage ratio is a financial performance measure used by management to reflect the relationship between the partnership's financial operating performance and cash distribution capability. We define the distribution coverage ratio as the ratio of DCF attributable to GP and LP unitholders to total GP and LP distributions declared.

Leverage ratio is a liquidity measure used by management, industry analysts, investors, lenders and rating agencies to analyze our ability to incur and service debt and fund capital expenditures.


Forward-Looking statements

This press release contains forward-looking statements within the meaning of federal securities laws regarding MPLX LP (MPLX). These forward-looking statements relate to, among other things, MPLX’s acquisition of Andeavor Logistics LP and include expectations, estimates and projections concerning the business and operations, financial priorities and strategic plans of MPLX. These statements are accompanied by cautionary language identifying important factors, though not necessarily all such factors, that could cause future outcomes to differ materially from those set forth in the forward-looking statements. You can identify forward-looking statements by words such as “anticipate,” “believe,” “commitment,” “could,” “design,” “estimate,” “expect,” “forecast,” “goal,” “guidance,” “imply,” “intend,” “may,” “objective,” “opportunity,” “outlook,” “plan,” “policy,” “position,” “potential,” “predict,” “priority,” “project,” “proposition,” “prospective,” “pursue,” “seek,” “should,” “strategy,” “target,” “would,” “will” or other similar expressions that convey the uncertainty of future events or outcomes. Such forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond the company’s control and are difficult to predict. Factors that could cause MPLX’s actual results to differ materially from those implied in the forward-looking statements include but are not limited to: Marathon Petroleum Corporation’s (MPC) ability to achieve the strategic and other objectives related to the strategic initiatives and review discussed herein; the risk that anticipated opportunities and any other synergies from or anticipated benefits of the Andeavor Logistics acquisition may not be fully realized or may take longer to realize than expected, including whether the transaction will be accretive within the expected timeframe or at all; disruption from the transaction making it more difficult to maintain relationships with customers, employees or suppliers; risks relating to any unforeseen liabilities of ANDX; the amount and timing of future distributions; negative capital market conditions, including an increase of the current yield on common units; the ability to achieve strategic and financial objectives, including with respect to distribution coverage, future distribution levels, proposed projects and completed transactions; the success of MPC’s portfolio optimization, including the ability to complete any divestitures on commercially reasonable terms and/or within the expected timeframe, and the effects of any such


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divestitures on the business, financial condition, results of operations and cash flows; adverse changes in laws including with respect to tax and regulatory matters; the adequacy of capital resources and liquidity, including, but not limited to, availability of sufficient cash flow to pay distributions and access to debt on commercially reasonable terms, and the ability to successfully execute business plans, growth strategies and self-funding models; the timing and extent of changes in commodity prices and demand for crude oil, refined products, feedstocks or other hydrocarbon-based products; continued/further volatility in and/or degradation of market and industry conditions; changes to the expected construction costs and timing of projects and planned investments, and the ability to obtain regulatory and other approvals with respect thereto; completion of midstream infrastructure by competitors; disruptions due to equipment interruption or failure, including electrical shortages and power grid failures; the suspension, reduction or termination of MPC’s obligations under MPLX’s commercial agreements; modifications to financial policies, capital budgets, and earnings and distributions; the ability to manage disruptions in credit markets or changes to credit ratings; compliance with federal and state environmental, economic, health and safety, energy and other policies and regulations and/or enforcement actions initiated thereunder; adverse results in litigation; other risk factors inherent to MPLX’s industry; risks related to MPC; and the factors set forth under the heading “Risk Factors” in MPLX’s Annual Report on Form 10-K for the year ended Dec. 31, 2018, and in Forms 10-Q, filed with Securities and Exchange Commission (SEC).

Factors that could cause MPC's actual results to differ materially from those implied in the forward-looking statements include: with respect to the planned Speedway separation, the ability to successfully complete the separation within the expected timeframe or at all, based on numerous factors including the macroeconomic environment, credit markets and equity markets, and the ability to satisfy customary conditions and achieve the strategic and other objectives related thereto; with respect to the Midstream review, the ability to achieve the strategic and other objectives related to the strategic review discussed herein; the risk that the cost savings and any other synergies from the Andeavor transaction may not be fully realized or may take longer to realize than expected; disruption from the Andeavor transaction making it more difficult to maintain relationships with customers, employees or suppliers; risks relating to any unforeseen liabilities of Andeavor; risks related to the acquisition of Andeavor Logistics LP by MPLX, including the risk that anticipated opportunities and any other synergies from or anticipated benefits of the transaction may not be fully realized or may take longer to realize than expected, including whether the transaction will be accretive within the expected timeframe or at all, or disruption from the transaction making it more difficult to maintain relationships with customers, employees or suppliers; the ability to complete any divestitures on commercially reasonable terms and/or within the expected timeframe, and the effects of any such divestitures on the business, financial condition, results of operations and cash flows; future levels of revenues, refining and marketing margins, operating costs, retail gasoline and distillate margins, merchandise margins, income from operations, net income and earnings per share; the regional, national and worldwide availability and pricing of refined products, crude oil, natural gas, NGLs and other feedstocks; consumer demand for refined products; the ability to manage disruptions in credit markets or changes to credit ratings; future levels of capital, environmental and maintenance expenditures; general and administrative and other expenses; the success or timing of completion of ongoing or anticipated capital or maintenance projects; the reliability of processing units and other equipment; business strategies, growth opportunities and expected investment; share repurchase authorizations, including the timing and amounts of such repurchases; the adequacy of capital resources and liquidity, including availability, timing and amounts of free cash flow necessary to execute business plans and to effect any share repurchases or dividend increases; the effect of restructuring or reorganization of business components; the potential effects of judicial or other proceedings on the business, financial condition, results of operations and cash flows; continued or further volatility in and/or


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degradation of general economic, market, industry or business conditions; compliance with federal and state environmental, economic, health and safety, energy and other policies and regulations, including the cost of compliance with the Renewable Fuel Standard, and/or enforcement actions initiated thereunder; the anticipated effects of actions of third parties such as competitors, activist investors or federal, foreign, state or local regulatory authorities or plaintiffs in litigation; the impact of adverse market conditions or other similar risks to those identified herein affecting MPLX; and the factors set forth under the heading “Risk Factors” in MPC’s Annual Report on Form 10-K for the year ended Dec. 31, 2018, and in Forms 10-Q, filed with the SEC.

We have based our forward-looking statements on our current expectations, estimates and projections about our business and industry. We caution that these statements are not guarantees of future performance and you should not rely unduly on them, as they involve risks, uncertainties, and assumptions that we cannot predict. In addition, we have based many of these forward-looking statements on assumptions about future events that may prove to be inaccurate. While our management considers these assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond our control. Accordingly, our actual results may differ materially from the future performance that we have expressed or forecast in our forward-looking statements. We undertake no obligation to update any forward-looking statements except to the extent required by applicable law. Copies of MPLX's Form 10-K and Forms 10-Q are available on the SEC website, MPLX's website at http://ir.mplx.com or by contacting MPLX's Investor Relations office. Copies of MPC's Form 10-K and Forms 10-Q are available on the SEC website, MPC's website at https://www.marathonpetroleum.com/Investors/ or by contacting MPC's Investor Relations office.


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Condensed Results of Operations (unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended 
 Sept. 30
 
 
Nine Months Ended 
 Sept. 30
(In millions, except per unit data)
 
2019
 
 
2018
 
 
2019
 
 
2018
Revenues and other income:
 
 
 
 
 
 
 
 
 
 
 
Operating revenue
$
928

 
$
843

 
$
2,818

 
$
2,306

Operating revenue - related parties
 
1,224

 
 
776

 
 
3,562

 
 
2,148

Income (loss) from equity method investments
 
95

 
 
64

 
 
255

 
 
175

Other income
 
33

 
 
29

 
 
90

 
 
81

Total revenues and other income
 
2,280

 
 
1,712

 
 
6,725

 
 
4,710

Costs and expenses:
 
 
 
 
 
 
 
 
 
 
 
Operating expenses
 
573

 
 
514

 
 
1,691

 
 
1,406

Operating expenses - related parties
 
348

 
 
229

 
 
1,018

 
 
630

Depreciation and amortization
 
302

 
 
201

 
 
916

 
 
565

General and administrative expenses
 
102

 
 
76

 
 
293

 
 
217

Other taxes
 
29

 
 
20

 
 
84

 
 
55

Total costs and expenses
 
1,354

 
 
1,040

 
 
4,002

 
 
2,873

Income from operations
 
926

 
 
672

 
 
2,723

 
 
1,837

Interest and other financial costs
 
233

 
 
153

 
 
686

 
 
434

Income before income taxes
 
693

 
 
519

 
 
2,037

 
 
1,403

(Benefit) provision for income taxes
 
4

 
 
3

 
 
2

 
 
8

Net income
 
689

 
 
516

 
 
2,035

 
 
1,395

Less: Net income (loss) attributable to noncontrolling interests
 
8

 
 
6

 
 
20

 
 
11

Less: Net income attributable to Predecessor
 
52

 
 

 
 
401

 
 

Net income attributable to MPLX LP
 
629

 
 
510

 
 
1,614

 
 
1,384

Less: Series A preferred unit distributions
 
20

 
 
19

 
 
61

 
 
55

Less: Series B preferred unit distributions
 
7

 
 

 
 
7

 
 

Limited partners’ interest in net income attributable to MPLX LP
$
602

 
$
491

 
$
1,546

 
$
1,329

 
 
 
 
 
 
 
 
 
 
 
 
Per Unit Data
 
 
 
 
 
 
 
 
 
 
 
Net income attributable to MPLX LP per limited partner unit:
 
 
 
 
 
 
 
 
 
 
 
Common - basic
$
0.61

 
$
0.62

 
$
1.78

 
$
1.77

Common - diluted
$
0.61

 
$
0.62

 
$
1.78

 
$
1.77

Weighted average limited partner units outstanding:
 
 
 
 
 
 
 
 
 
 
 
Common units – basic
 
974

 
 
794

 
 
855

 
 
750

Common units – diluted
 
975

 
 
794

 
 
855

 
 
750

 
 
 
 
 
 
 
 
 
 
 
 





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Select Financial Statistics (unaudited)
 
Three Months Ended 
 Sept. 30
 
 
Nine Months Ended 
 Sept. 30
(In millions, except ratio data)
 
2019
 
 
2018
 
 
2019
 
 
2018
Common unit distributions declared by MPLX
 
 
 
 
 
 
 
 
 
 
 
Common units (LP) - public(a)
$
266

 
$
185

 
$
718

 
$
545

Common units - MPC(a)(b)
 
438

 
 
322

 
 
1,201

 
 
926

Total GP and LP distribution declared
 
704

 
 
507

 
 
1,919

 
 
1,471

 
 
 
 
 
 
 
 
 
 
 
 
Preferred unit distributions(c)
 
 
 
 
 
 
 
 
 
 
 
Series A preferred unit distributions(d)
 
20

 
 
19

 
 
61

 
 
55

Series B preferred unit distributions(e)
 
10

 
 

 
 
31

 
 

Total preferred unit distributions
 
30

 
 
19

 
 
92

 
 
55

 
 
 
 
 
 
 
 
 
 
 
 
Other Financial Data
 
 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA attributable to MPLX LP (excluding predecessor results)(f)(g)
 
1,165



937



3,015



2,564

Adjusted EBITDA attributable to MPLX LP (including predecessor results)(f)(h)
 
1,273



N/A



3,785



N/A

DCF attributable to GP and LP unitholders(f)(h)
$
997

 
$
747

 
$
2,963

 
$
2,025

Distribution coverage ratio(i)
 
1.42x



1.47x



1.54x



1.38x

 
 
 
 
 
 
 
 
 
 
 
 
Cash Flow Data
 
 
 
 
 
 
 
 
 
 
 
Net cash flow provided by (used in):
 
 
 
 
 
 
 
 
 
 
 
Operating activities
$
1,036


$
737


$
2,990


$
2,027

Investing activities
 
(750
)
 
 
(1,073
)
 
 
(2,189
)
 
 
(2,027
)
Financing activities
$
(276
)
 
$
366

 
$
(845
)
 
$
30

 
 
 
 
 
 
 
 
 
 
 
 
(a)
The distribution on common units for both the three and nine months ended September 30, 2019 includes the impact of the issuance of approximately 102 million units issued to public unitholders and approximately 161 million units issued to MPC in connection with MPLX's acquisition of ANDX on July 30, 2019.
(b)
Distributions to MPC exclude $12.5 million in distributions waived by MPC in connection with MPLX’s acquisition of ANDX with ANDX for the three months ended September 30, 2019 and $25 million for the nine months ended September 30, 2019. The waiver was instituted in 2017 under the terms of ANDX's historical partnership agreement and will remain in effect through 2019, the original term of the waiver agreement. In addition, MPC agreed to waive $23.7 million in common unit distributions associated with the units received in connection with the Feb. 1, 2018 dropdown.
(c)
Includes MPLX distributions declared on the Series A and Series B preferred units as well as distributions earned on the Series B preferred units for the three months ended September 30, 2019 assuming a distribution is declared by the Board of Directors (distributions on Series B preferred units are declared and payable semi-annually on February 15th and August 15th or the first business day thereafter). Cash distributions declared/to be paid to holders of the Series A and Series B preferred units are not available to common unitholders.
(d)
Series A preferred units are considered redeemable securities due to the existence of redemption provisions upon a deemed liquidation event which is outside our control. These units rank senior to all common units with respect to distributions and rights upon liquidation and effective May 13, 2018, on an as-converted basis, preferred unit holders receive the greater of $0.528125 per unit or the amount of per unit distributions paid to holders of MPLX LP common units.
(e)
As a result of the ANDX acquisition, 600,000 ANDX preferred units were converted into 600,000 preferred units of MPLX (the “Series B preferred units”). Series B preferred unitholders are entitled to receive a fixed distribution of $68.75 per unit, per annum, payable semi-annually in arrears on February 15 and August 15 or the first business day thereafter.
(f)
Non-GAAP measure. See reconciliation below.
(g)
Excludes predecessor EBITDA that is attributable to the period prior to the acquisition date of July 30, 2019.
(h)
Includes predecessor EBITDA and DCF that is attributable to the period prior to the acquisition date of July 30, 2019.
(i)
DCF attributable to GP and LP unitholders (including DCF attributable to predecessor) divided by total GP and LP distribution declared.



10


Select Balance Sheet Data (unaudited)
 
 
 
 
 
(In millions, except ratio data)
 
Sept. 30, 2019
 
 
December 31, 2018(a)
Cash and cash equivalents
$
41

 
$
77

Total assets
 
41,281

 
 
39,325

Total long-term debt(b)
 
19,825

 
 
18,435

Redeemable preferred units
 
968

 
 
1,004

Total equity
$
17,892

 
$
17,731

Consolidated total debt to adjusted EBITDA(c)
 
4.0x

 
 
3.8x

 
 
 
 
 
 
Partnership units outstanding:
 
 
 
 
 
MPC-held common units
 
666

 
 
505

Public common units
 
392

 
 
289

 
 
 
 
 
 
(a)
Financial information has been retrospectively adjusted for the acquisition of ANDX.
(b)
Outstanding intercompany borrowings were $125 million as of September 30, 2019 and zero December 31, 2018. Includes current portion of long-term debt.
(c)
Calculated using face value total debt and LTM pro forma adjusted EBITDA, which is pro forma for acquisitions. Face value total debt includes approximately $420 million and $431 million of unamortized discount and debt issuance costs as of September 30, 2019 and December 31, 2018, respectively.


Operating Statistics (unaudited)(a)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended 
 Sept. 30
 
 
Nine Months Ended 
 Sept. 30
 
 
2019
 
 
2018
 
% Change
 
 
2019
 
 
2018
 
% Change
Logistics and Storage
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pipeline throughput (mbpd)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Crude oil pipelines
 
3,367

 
 
2,208

 
52
 %
 
 
3,240

 
 
2,149

 
51
 %
Product pipelines
 
1,859

 
 
1,182

 
57
 %
 
 
1,875

 
 
1,135

 
65
 %
Total pipelines
 
5,226

 
 
3,390

 
54
 %
 
 
5,115

 
 
3,284

 
56
 %
Average tariff rates ($ per barrel)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Crude oil pipelines
$
0.97

 
$
0.60

 
62
 %
 
$
0.94

 
$
0.58

 
62
 %
Product pipelines
 
0.77

 
 
0.86

 
(10
)%
 
 
0.73

 
 
0.80

 
(9
)%
Total pipelines
$
0.90

 
$
0.69

 
30
 %
 
 
0.86

 
 
0.66

 
30
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Terminal throughput (mbpd)
 
3,292

 
 
1,474

 
123
 %
 
 
3,267

 
 
1,468

 
123
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Barges at period-end
 
264

 
 
256

 
3
 %
 
 
264

 
 
256

 
3
 %
Towboats at period-end
 
23

 
 
20

 
15
 %
 
 
23

 
 
20

 
15
 %
(a)
Includes predecessor operations for the three and nine months ended September 30, 2019.


11


Gathering and Processing Operating Statistics (unaudited) - Consolidated(a)
 
Three Months Ended 
 Sept. 30
 
 
Nine Months Ended 
 Sept. 30
 
 
2019
 
 
2018
 
% Change
 
 
2019
 
 
2018
 
% Change
Gathering throughput (mmcf/d)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
1,271

 
 
1,201

 
6
 %
 
 
1,273

 
 
1,157

 
10
 %
Utica Operations
 

 
 

 
 %
 
 

 
 

 
 %
Southwest Operations
 
1,653

 
 
1,599

 
3
 %
 
 
1,618

 
 
1,523

 
6
 %
Bakken Operations
 
149

 
 
N/A

 
N/A

 
 
149

 
 
N/A

 
N/A

Rockies Operations
 
627

 
 
N/A

 
N/A

 
 
639

 
 
N/A

 
N/A

Total gathering throughput
 
3,700

 
 
2,800

 
32
 %
 
 
3,679

 
 
2,680

 
37
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Natural gas processed (mmcf/d)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
4,264

 
 
4,004

 
6
 %
 
 
4,211

 
 
3,775

 
12
 %
Utica Operations
 

 
 

 
 %
 
 

 
 

 
 %
Southwest Operations
 
1,667

 
 
1,479

 
13
 %
 
 
1,608

 
 
1,403

 
15
 %
Southern Appalachian Operations
 
254

 
 
226

 
12
 %
 
 
244

 
 
244

 
 %
Bakken Operations
 
149

 
 
N/A

 
N/A

 
 
149

 
 
N/A

 
N/A

Rockies Operations
 
568

 
 
N/A

 
N/A

 
 
575

 
 
N/A

 
N/A

Total natural gas processed
 
6,902

 
 
5,709

 
21
 %
 
 
6,787

 
 
5,422

 
25
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
C2 + NGLs fractionated (mbpd)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
433

 
 
405

 
7
 %
 
 
431

 
 
374

 
15
 %
Utica Operations
 

 
 

 
 %
 
 

 
 

 
 %
Southwest Operations
 
19

 
 
20

 
(5
)%
 
 
13

 
 
18

 
(28
)%
Southern Appalachian Operations
 
13

 
 
14

 
(7
)%
 
 
12

 
 
13

 
(8
)%
Bakken Operations
 
29

 
 
N/A

 
N/A

 
 
22

 
 
N/A

 
N/A

Rockies Operations
 
4

 
 
N/A

 
N/A

 
 
4

 
 
N/A

 
N/A

Total C2 + NGLs fractionated
 
498

 
 
439

 
13
 %
 
 
482

 
 
405

 
19
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(a)
Includes operating data for entities that have been consolidated into the MPLX financial statements. Also includes predecessor operations for the three and nine months ended September 30, 2019.


12


Gathering and Processing Operating Statistics (unaudited) - Operated(a)
 
Three Months Ended 
 Sept. 30
 
 
Nine Months Ended 
 Sept. 30
 
 
2019
 
 
2018
 
% Change
 
 
2019
 
 
2018
 
% Change
Gathering throughput (mmcf/d)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
1,271

 
 
1,201

 
6
 %
 
 
1,273

 
 
1,157

 
10
 %
Utica Operations
 
2,381

 
 
1,936

 
23
 %
 
 
2,186

 
 
1,722

 
27
 %
Southwest Operations
 
1,653

 
 
1,600

 
3
 %
 
 
1,618

 
 
1,524

 
6
 %
Bakken Operations
 
149

 
 
N/A

 
N/A

 
 
149

 
 
N/A

 
N/A

Rockies Operations
 
827

 
 
N/A

 
N/A

 
 
835

 
 
N/A

 
N/A

Total gathering throughput
 
6,281

 
 
4,737

 
33
 %
 
 
6,061

 
 
4,403

 
38
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Natural gas processed (mmcf/d)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
5,300

 
 
4,609

 
15
 %
 
 
5,218

 
 
4,338

 
20
 %
Utica Operations
 
866

 
 
857

 
1
 %
 
 
835

 
 
889

 
(6
)%
Southwest Operations
 
1,667

 
 
1,479

 
13
 %
 
 
1,608

 
 
1,403

 
15
 %
Southern Appalachian Operations
 
254

 
 
226

 
12
 %
 
 
244

 
 
244

 
 %
Bakken Operations
 
149

 
 
N/A

 
N/A

 
 
149

 
 
N/A

 
N/A

Rockies Operations
 
568

 
 
N/A

 
N/A

 
 
575

 
 
N/A

 
N/A

Total natural gas processed
 
8,804

 
 
7,171

 
23
 %
 
 
8,629

 
 
6,874

 
26
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
C2 + NGLs fractionated (mbpd)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
433

 
 
405

 
7
 %
 
 
431

 
 
374

 
15
 %
Utica Operations
 
49

 
 
49

 
 %
 
 
45

 
 
46

 
(2
)%
Southwest Operations
 
19

 
 
20

 
(5
)%
 
 
13

 
 
18

 
(28
)%
Southern Appalachian Operations
 
13

 
 
14

 
(7
)%
 
 
12

 
 
13

 
(8
)%
Bakken Operations
 
29

 
 
N/A

 
N/A

 
 
22

 
 
N/A

 
N/A

Rockies Operations
 
4

 
 
N/A

 
N/A

 
 
4

 
 
N/A

 
N/A

Total C2 + NGLs fractionated
 
547

 
 
488

 
12
 %
 
 
527

 
 
451

 
17
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(a)
Includes operating data for entities that have been consolidated into the MPLX financial statements as well as operating data for partnership-operated equity method investments. Also includes predecessor operations for the three and nine months ended September 30, 2019.


13


Reconciliation of Segment Adjusted EBITDA to Net Income (unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended 
 Sept. 30
 
 
Nine Months Ended 
 Sept. 30
(In millions)
 
2019
 
 
2018
 
 
2019
 
 
2018
L&S segment adjusted EBITDA attributable to MPLX LP (including predecessor results)
$
849

 
$
547

 
$
2,498

 
$
1,510

G&P segment adjusted EBITDA attributable to MPLX LP (including predecessor results)
 
424

 
 
390

 
 
1,287

 
 
1,054

Adjusted EBITDA attributable to MPLX LP (including predecessor results)
 
1,273

 
 
937

 
 
3,785

 
 
2,564

Depreciation and amortization
 
(302
)
 
 
(201
)
 
 
(916
)
 
 
(565
)
Provision for income taxes
 
(4
)
 
 
(3
)
 
 
(2
)
 
 
(8
)
Amortization of deferred financing costs
 
(10
)
 
 
(14
)
 
 
(29
)
 
 
(45
)
Non-cash equity-based compensation
 
(5
)
 
 
(6
)
 
 
(17
)
 
 
(15
)
Net interest and other financial costs
 
(223
)
 
 
(139
)
 
 
(657
)
 
 
(389
)
Income from equity method investments
 
95

 
 
64

 
 
255

 
 
175

Distributions/adjustments related to equity method investments
 
(145
)
 
 
(112
)
 
 
(399
)
 
 
(314
)
Unrealized derivative losses(a)
 
11

 
 
(17
)
 
 
7

 
 
(18
)
Acquisition costs
 
(9
)
 
 

 
 
(14
)
 
 
(3
)
Other
 
(1
)
 
 

 
 
(1
)
 
 

Adjusted EBITDA attributable to noncontrolling interests
 
9

 
 
7

 
 
23

 
 
13

Net income
$
689

 
$
516

 
$
2,035

 
$
1,395

 
 
 
 
 
 
 
 
 
 
 
 
(a)
MPLX makes a distinction between realized and unrealized gains and losses on derivatives. During the period when a derivative contract is outstanding, changes in the fair value of the derivative are recorded as an unrealized gain or loss. When a derivative contract matures or is settled, the previously recorded unrealized gain or loss is reversed and the realized gain or loss of the contract is recorded.



14


L&S Reconciliation of Segment Income from Operations to Segment Adjusted EBITDA (unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended 
 Sept. 30
 
Nine Months Ended 
 Sept. 30
(In millions)
 
2019
 
 
2018
 
 
2019
 
 
2018
L&S segment income from operations
$
713

 
$
468

 
$
2,075

 
$
1,287

Depreciation and amortization
 
113

 
 
62

 
 
373

 
 
171

Income from equity method investments
 
(60
)
 
 
(43
)
 
 
(159
)
 
 
(123
)
Distributions/adjustments related to equity method investments
 
70

 
 
57

 
 
184

 
 
164

Acquisition costs
 
9

 
 

 
 
14

 
 
3

Non-cash equity-based compensation
 
3

 
 
3

 
 
10

 
 
8

Other
 
1

 
 

 
 
1

 
 

L&S segment adjusted EBITDA attributable to MPLX LP (including predecessor results)
 
849



547

 
 
2,498



1,510

L&S predecessor segment adjusted EBITDA attributable to MPLX LP
 
(83
)
 
 

 
 
(603
)
 
 

L&S segment adjusted EBITDA attributable to MPLX LP
$
766

 
$
547

 
$
1,895

 
$
1,510

 
 
 
 
 
 
 
 
 
 
 
 

G&P Reconciliation of Segment Income from Operations to Segment Adjusted EBITDA (unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended 
 Sept. 30
 
Nine Months Ended 
 Sept. 30
(In millions)
 
2019
 
 
2018
 
 
2019
 
 
2018
G&P segment income from operations
$
213

 
$
204

 
$
648

 
$
550

Depreciation and amortization
 
189

 
 
139

 
 
543

 
 
394

Income from equity method investments
 
(35
)
 
 
(21
)
 
 
(96
)
 
 
(52
)
Distributions/adjustments related to equity method investments
 
75

 
 
55

 
 
215

 
 
150

Unrealized derivative losses(a)
 
(11
)
 
 
17

 
 
(7
)
 
 
18

Non-cash equity-based compensation
 
2

 
 
3

 
 
7

 
 
7

Adjusted EBITDA attributable to noncontrolling interest
 
(9
)
 
 
(7
)
 
 
(23
)
 
 
(13
)
G&P segment adjusted EBITDA attributable to MPLX LP (including predecessor results)
 
424

 
 
390

 
 
1,287

 
 
1,054

G&P predecessor segment adjusted EBITDA attributable to MPLX LP
 
(25
)
 
 

 
 
(167
)
 
 

G&P segment adjusted EBITDA attributable to MPLX LP
$
399


$
390

 
$
1,120


$
1,054

 
 
 
 
 
 
 
 
 
 
 
 
(a)
MPLX makes a distinction between realized and unrealized gains and losses on derivatives. During the period when a derivative contract is outstanding, changes in the fair value of the derivative are recorded as an unrealized gain or loss. When a derivative contract matures or is settled, the previously recorded unrealized gain or loss is reversed and the realized gain or loss of the contract is recorded.



15


Reconciliation of Adjusted EBITDA Attributable to MPLX LP and DCF Attributable to GP and LP Unitholders from Net Income (Loss) (unaudited)


 
 
 
 
 
 
 
Three Months Ended 
 Sept. 30
 
 
Nine Months Ended 
 Sept. 30
(In millions)
 
2019
 
 
2018
 
 
2019
 
 
2018
Net income
$
689

 
$
516

 
$
2,035

 
$
1,395

Provision for income taxes
 
4

 
 
3

 
 
2

 
 
8

Amortization of deferred financing costs
 
10

 
 
14

 
 
29

 
 
45

Net interest and other financial costs
 
223

 
 
139

 
 
657

 
 
389

Income from operations
 
926

 
 
672

 
 
2,723

 
 
1,837

Depreciation and amortization
 
302

 
 
201

 
 
916

 
 
565

Non-cash equity-based compensation
 
5

 
 
6

 
 
17

 
 
15

Income from equity method investments
 
(95
)
 
 
(64
)
 
 
(255
)
 
 
(175
)
Distributions/adjustments related to equity method investments
 
145

 
 
112

 
 
399

 
 
314

Unrealized derivative (gains) losses(a)
 
(11
)
 
 
17

 
 
(7
)
 
 
18

Acquisition costs
 
9

 
 

 
 
14

 
 
3

Other
 
1

 
 

 
 
1

 
 

Adjusted EBITDA
 
1,282

 
 
944

 
 
3,808

 
 
2,577

Adjusted EBITDA attributable to noncontrolling interests
 
(9
)


(7
)


(23
)


(13
)
Adjusted EBITDA attributable to predecessor(b)
 
(108
)





(770
)



Adjusted EBITDA attributable to MPLX LP
 
1,165

 
 
937

 
 
3,015

 
 
2,564

Deferred revenue impacts
 
36



13



67



24

Net interest and other financial costs
 
(223
)


(139
)


(657
)


(389
)
Maintenance capital expenditures
 
(75
)


(40
)


(174
)


(98
)
Maintenance capital expenditures reimbursements
 
18






34




Equity method investment capital expenditures paid out
 
(8
)


(6
)


(16
)


(22
)
Other
 
6



1



16



1

Portion of DCF adjustments attributable to predecessor(b)
 
27






159




DCF attributable to MPLX LP
 
946



766



2,444



2,080

Preferred unit distributions(c)
 
(30
)


(19
)


(92
)


(55
)
DCF attributable to GP and LP unitholders (excluding predecessor results)
 
916

 
 
747

 
 
2,352

 
 
2,025

Adjusted EBITDA attributable to predecessor(b)
 
108






770




Portion of DCF adjustments attributable to predecessor(b)
 
(27
)





(159
)



DCF attributable to GP and LP unitholders (including predecessor results)
$
997

 
$
747

 
$
2,963

 
$
2,025

 
 
 
 
 
 
 
 
 
 
 
 
(a)
MPLX makes a distinction between realized and unrealized gains and losses on derivatives. During the period when a derivative contract is outstanding, changes in the fair value of the derivative are recorded as an unrealized gain or loss. When a derivative contract matures or is settled, the previously recorded unrealized gain or loss is reversed and the realized gain or loss of the contract is recorded.
(b)
The adjusted EBITDA and DCF adjustments related to predecessor are excluded from adjusted EBITDA attributable to MPLX LP and DCF attributable to GP and LP unitholders prior to the acquisition date.
(c)
Includes MPLX distributions declared on the Series A and Series B preferred units as well as cash distributions earned by the Series B preferred units for the three months ended September 30, 2019 (as the Series B preferred units are declared and payable semi-annually) assuming a distribution is declared by the Board of Directors. Cash distributions declared/to be paid to holders of the Series A and Series B preferred units are not available to common unitholders.


16


Reconciliation of Net Income to LTM Pro forma adjusted EBITDA (unaudited)
 
 
 
 
Three Months Ended 
 Sept. 30
(In millions)
 
2019
 
 
2018
LTM Net income
$
2,126

 
$
1,636

LTM Net income to adjusted EBITDA adjustments
 
1,908

 
 
1,811

LTM Adjusted EBITDA attributable to MPLX LP
 
4,034

 
 
3,447

LTM Pro forma adjustments for acquisitions
 
1,001

 
 
37

LTM Pro forma adjusted EBITDA
 
5,035

 
 
3,484

Consolidated debt
$
20,245

 
$
13,357

Consolidated debt to adjusted EBITDA
 
4.0x

 
 
3.8x

 
 
 
 
 
 



17


Reconciliation of Adjusted EBITDA Attributable to MPLX LP and DCF Attributable to GP and LP Unitholders from Net Cash Provided by Operating Activities (unaudited)
 
 
 
 
 
 
 
 
 
 
Three Months Ended 
 Sept. 30
 
 
Nine Months Ended 
 Sept. 30
(In millions)
 
2019
 
 
2018
 
 
2019
 
 
2018
Net cash provided by operating activities
$
1,036

 
$
737

 
$
2,990

 
$
2,027

Changes in working capital items
 
21

 
 
45

 
 
134

 
 
78

All other, net
 
(15
)
 
 
(9
)
 
 
(23
)
 
 
5

Non-cash equity-based compensation
 
5

 
 
6

 
 
17