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Section 1: 8-K (8-K)

Document
false0001552000 0001552000 2020-01-29 2020-01-29


 
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) January 29, 2020
 _____________________________________________
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 January 29, 2020, MPLX LP issued a press release announcing fourth-quarter and full-year 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 issued by MPLX LP on January 29, 2020
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: January 29, 2020
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


402495314_mplxearningslogoa03.jpg
MPLX LP Reports Fourth-Quarter and Full-Year Financial Results

Reported fourth-quarter net loss attributable to MPLX of $581 million and full-year net income attributable to MPLX of $1.0 billion; includes non-cash impairment charges of $1.2 billion in fourth quarter primarily related to goodwill associated with the Andeavor Logistics G&P businesses acquired by MPC as part of its combination with Andeavor in October 2018
Reported fourth-quarter adjusted EBITDA attributable to MPLX of $1.3 billion and full-year adjusted EBITDA attributable to MPLX of $4.3 billion, or $5.1 billion including results of Andeavor Logistics
Generated $4.1 billion in net cash provided by operating activities for the full-year 2019, supporting the return of capital of approximately $2.8 billion to unitholders
Reduced 2020 growth capital spending target to approximately $1.5 billion
Targeting positive free cash flow, after capital investments and distributions, in 2021

FINDLAY, Ohio, Jan. 29, 2020 - MPLX LP (NYSE: MPLX) today reported a fourth-quarter 2019 net loss attributable to MPLX of $581 million compared with net income of $434 million for the fourth quarter of 2018. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) attributable to MPLX was $1.3 billion, compared with $1.2 billion in the fourth quarter of 2018. Fourth-quarter 2019 results include non-cash impairment charges of $1.2 billion, primarily related to goodwill associated with the Andeavor Logistics (ANDX) gathering and processing businesses acquired by Marathon Petroleum Corporation (NYSE: MPC) as part of its combination with Andeavor in October 2018.

The Logistics and Storage (L&S) segment reported segment income from operations of $677 million and adjusted EBITDA of $853 million for the quarter, up $40 million and $44 million, respectively, versus the fourth quarter of last year. The Gathering and Processing (G&P) segment reported a segment loss from operations of $1.0 billion and adjusted EBITDA of $466 million for the quarter, down $1.3 billion and up $29 million, respectively, on a year-over-year basis. G&P results include the non-cash impairment charges discussed above.

MPLX today announced an updated 2020 growth capital target of approximately $1.5 billion from the previously announced target of approximately $2.0 billion. Michael J. Hennigan, president and chief executive officer, commented, “We have further streamlined our project portfolio to focus on projects that deliver the highest returns. Our continued efforts to high-grade our capital spending will help accomplish our target of positive free cash flow generation, after capital investments and distributions, in 2021. This inflection is expected to allow both the funding of our distribution and capital program entirely from internally generated cash flow, as well as increase our flexibility to reduce debt or repurchase units.”

During the quarter, MPLX generated $1.1 billion in net cash provided by operating activities and $1.0 billion of distributable cash flow, which provided adjusted distribution coverage of 1.42 times.


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MPLX also announced its 28th consecutive distribution increase, to $0.6875 per common unit, a $0.01 increase over the prior quarter and a 6.2% increase over the prior year's fourth quarter.

Financial Highlights
 
 
Three Months Ended 
 Dec. 31
 
 
Year Ended 
 Dec. 31
(In millions, except per unit and ratio data)
 
2019
 
 
2018
 
 
2019
 
 
2018
Net (loss) income attributable to MPLX
 
$
(581
)
 
 
$
434

 
 
$
1,033

 
 
$
1,818

Adjusted net (loss) income attributable to MPLX(a)
 
(581
)
 
 
606

 
 
1,434

 
 
1,990

Adjusted EBITDA attributable to MPLX LP (excluding predecessor results)(b)
 
1,319

 
 
911

 
 
4,334

 
 
3,475

Adjusted EBITDA attributable to MPLX LP (including predecessor results)(c)
 
1,319

 
 
1,246

 
 
5,104

 
 
3,810

Net cash provided by operating activities
 
1,092

 
 
1,044

 
 
4,082

 
 
3,071

Distributable cash flow attributable to MPLX LP(c)
 
1,045

 
 
955

 
 
4,100

 
 
3,035

Distribution per common unit(d)
 
$
0.6875

 
 
$
0.6475

 
 
$
2.6900

 
 
$
2.5300

Distribution coverage ratio(e)
 
1.42x

 
 
1.80x

 
 
1.51x

 
 
1.49x

Consolidated debt to adjusted EBITDA(f)
 
4.1x

 
 
3.9x

 
 
N/A

 
 
N/A

 
 
 
 
 
 
 
 
 
 
 
 
(a)
Includes net income attributable to predecessor.
(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. For the three months and year ended December 31, 2018, DCF attributable to predecessor for the fourth quarter has been included with no corresponding distribution being declared by MPLX relating to the predecessor, resulting in distribution coverage ratios of 1.80x and 1.49x, respectively. For the year ended December 31, 2019, DCF attributable to predecessor has been included with no corresponding distribution being declared by MPLX relating to the predecessor for the first quarter of 2019, resulting in a distribution coverage ratio of 1.51x.
(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 
 Dec. 31
 
 
Year Ended 
 Dec. 31
Segment income (loss) from operations (unaudited)
 
2019
 
 
2018
 
 
2019
 
 
2018
Logistics and Storage
$
677

 
$
637

 
$
2,752

 
$
1,924

Gathering and Processing
 
(1,023
)
 
 
254

 
 
(375
)
 
 
804

 
 
 
 
 
 
 
 
 
 
 
 
Segment adjusted EBITDA attributable to MPLX LP (unaudited)
 
 
 
 
 
 
 
 
 
 
 
Logistics and Storage
 
853

 
 
809

 
 
3,351

 
 
2,319

Gathering and Processing
$
466

 
$
437

 
$
1,753

 
$
1,491

 
 
 
 
 
 
 
 
 
 
 
 

Logistics & Storage

L&S segment income from operations and adjusted EBITDA for the fourth quarter of 2019 increased by $40 million and $44 million, respectively, compared to the same period in 2018. The increase was primarily due to the acquisition of ANDX and the performance of the underlying base business.



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Total pipeline throughputs were 5.1 million barrels per day in the fourth quarter, relatively flat versus the same quarter of 2018, despite volume impacts related to project work at MPC's Garyville refinery. The average tariff rate was $0.90 per barrel for the quarter. Terminal throughput was 3.3 million barrels per day for the quarter, an increase of 4% versus the same quarter of 2018.

Gathering & Processing

G&P segment income from operations and segment adjusted EBITDA for the fourth quarter of 2019 decreased by $1.3 billion and increased by $29 million, respectively, compared to the same period in 2018. Year-over-year results were impacted by non-cash impairment charges of $1.2 billion, primarily related to goodwill associated with the ANDX G&P businesses acquired by MPC as part of its combination with Andeavor in October 2018. In the fourth quarter of 2019:
Gathered volumes: 6.2 billion cubic feet per day, a 5% increase versus the fourth quarter of 2018
Processed volumes: 8.8 billion cubic feet per day, a 7% increase versus the fourth quarter of 2018
Fractionated volumes: 557 thousand barrels per day, an 11% increase versus the fourth quarter of 2018

In the Marcellus and Utica, the company continued to experience significant year-over-year growth:
Gathered volumes averaged 3.6 billion cubic feet per day (bcf/d) in the fourth quarter, an 11% increase versus the fourth quarter of 2018. For the full year, gathered volumes increased 18% year-over-year
Processed volumes averaged 6.1 bcf/d in the fourth quarter, a 7% increase versus the fourth quarter of 2018 driven by the addition of the Sherwood 12 and 13 processing plants, which were placed in service during the quarter. For the full year, processed volumes increased 14% year-over-year
Fractionated volumes averaged 487 thousand barrels per day in the fourth quarter, a 9% increase versus the fourth quarter of 2018. The increase was primarily driven by higher volumes from expansions at the Hopedale and Sherwood complexes. For the full year, fractionated volumes increased 12% year-over-year

Strategic Update

Today, MPLX announced an updated 2020 growth capital target of approximately $1.5 billion from the previously announced target of approximately $2.0 billion. The company also announced it is targeting positive free cash flow, after capital investments and distributions, in 2021. This inflection is expected to allow both the funding of its distribution and capital program entirely from internally generated cash flow. Removing MPLX’s reliance on external funding and shifting to a model focused on generating cash flow beyond the needs of the business is anticipated to enable MPLX to focus its capital allocation toward opportunities like debt reduction or unit repurchases.

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 completed 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 MPC's Galveston Bay refinery.


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Also in the Permian, the Whistler Pipeline is being designed to transport approximately 2 bcf/d 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.

MPLX continues to progress its Permian-to-Gulf Coast NGL pipeline, called BANGL, which has a planned capacity of approximately 500 thousand barrels per day. The company expects a final investment decision in the near term.

Reversal of the Capline pipeline continues to progress, with a purge of the mainline completed in the fourth quarter. Once reversed, Capline will be capable of supplying discounted mid-continent and Canadian crude to St. James, Louisiana, which has a direct connection to MPC’s Garyville refinery. Capline, which is partially owned by MPC and operated by MPLX, is expected to begin light crude service in mid-2021, with heavy crude service expected in 2022.
 
To support additional growth in the G&P segment, following the Sherwood 12 and Torñado processing plants that came online in October 2019, MPLX completed the Sherwood 13 processing plant late in the fourth quarter. This added another 200 million cubic feet per day of incremental capacity. The company expects to place in service the Omega 2 processing plant in the STACK shale play in Oklahoma in the first quarter of 2020, the Preakness processing plant in the Permian in the second quarter of 2020, and the Smithburg 1 processing plant in the Marcellus in the third quarter of 2020.

Financial Position and Liquidity

As of Dec. 31, 2019, MPLX had $15 million in cash, $3.5 billion available through its bank revolving credit facility expiring in July 2024 and $0.9 billion available through its intercompany loan agreement with MPC. The company's leverage ratio was 4.1 times at Dec. 31, 2019. MPLX remains committed to maintaining an investment-grade credit profile.

Conference Call

At 11 a.m. ET 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 website at http://www.mplx.com and clicking on the "2019 Fourth-Quarter and Full-Year Financial Results" link in the "Financial Results" section. A replay of the webcast will be available on MPLX's website for two weeks. Financial information, including this 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


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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 Kheiry, 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.

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


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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 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; the risk of further impairments; 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 positive free cash flow in 2021, and 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 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


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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, including obtaining regulatory approvals, 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 related thereto; 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 risk of further impairments; 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 to maintain or increase the dividend; 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 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


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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 
 Dec. 31
 
 
Year Ended 
 Dec. 31
(In millions, except per unit data)
 
2019
 
 
2018
 
 
2019
 
 
2018
Revenues and other income:
 
 
 
 
 
 
 
 
 
 
 
Operating revenue
$
1,014

 
$
1,009

 
$
3,832

 
$
3,315

Operating revenue - related parties
 
1,231

 
 
1,189

 
 
4,793

 
 
3,337

Income from equity method investments
 
35

 
 
72

 
 
290

 
 
247

Other income
 
36

 
 
25

 
 
126

 
 
106

Total revenues and other income
 
2,316

 
 
2,295

 
 
9,041

 
 
7,005

Costs and expenses:
 
 
 
 
 
 
 
 
 
 
 
Operating expenses
 
625

 
 
649

 
 
2,316

 
 
2,055

Operating expenses - related parties
 
378

 
 
326

 
 
1,396

 
 
956

Depreciation and amortization
 
338

 
 
302

 
 
1,254

 
 
867

Impairment expense
 
1,197

 
 

 
 
1,197

 
 

General and administrative expenses
 
95

 
 
99

 
 
388

 
 
316

Other taxes
 
29

 
 
28

 
 
113

 
 
83

Total costs and expenses
 
2,662

 
 
1,404

 
 
6,664

 
 
4,277

Income from operations
 
(346
)
 
 
891

 
 
2,377

 
 
2,728

Interest and other financial costs
 
229

 
 
280

 
 
915

 
 
714

Income before income taxes
 
(575
)
 
 
611

 
 
1,462

 
 
2,014

(Benefit) provision for income taxes
 
(2
)
 
 

 
 

 
 
8

Net (loss) income
 
(573
)
 
 
611

 
 
1,462

 
 
2,006

Less: Net income attributable to noncontrolling interests
 
8

 
 
5

 
 
28

 
 
16

Less: Net income attributable to Predecessor
 

 
 
172

 
 
401

 
 
172

Net (loss) income attributable to MPLX LP
 
(581
)
 
 
434

 
 
1,033

 
 
1,818

Less: Series A preferred unit distributions
 
20

 
 
20

 
 
81

 
 
75

Less: Series B preferred unit distributions
 
10

 
 

 
 
17

 
 

Limited partners’ interest in net (loss) income attributable to MPLX LP
$
(611
)
 
$
414

 
$
935

 
$
1,743

 
 
 
 
 
 
 
 
 
 
 
 
Per Unit Data
 
 
 
 
 
 
 
 
 
 
 
Net (loss) income attributable to MPLX LP per limited partner unit:
 
 
 
 
 
 
 
 
 
 
 
Common - basic
$
(0.58
)
 
$
0.52

 
$
1.00

 
$
2.29

Common - diluted
$
(0.58
)
 
$
0.52

 
$
1.00

 
$
2.29

Weighted average limited partner units outstanding:
 
 
 
 
 
 
 
 
 
 
 
Common units – basic
 
1,058

 
 
794

 
 
906

 
 
761

Common units – diluted
 
1,058

 
 
794

 
 
907

 
 
761

 
 
 
 
 
 
 
 
 
 
 
 





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Select Financial Statistics (unaudited)
 
Three Months Ended 
 Dec. 31
 
 
Year Ended 
 Dec. 31
(In millions, except ratio data)
 
2019
 
 
2018
 
 
2019
 
 
2018
Common unit distributions declared by MPLX
 
 
 
 
 
 
 
 
 
 
 
Common units (LP) - public(a)
$
270

 
$
187

 
$
988

 
$
732

Common units - MPC(a)(b)
 
446

 
 
327

 
 
1,647

 
 
1,253

Total GP and LP distribution declared
 
716

 
 
514

 
 
2,635

 
 
1,985

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

 
 
20

 
 
81

 
 
75

Series B preferred unit distributions(e)
 
11

 
 

 
 
42

 
 

Total preferred unit distributions
 
31

 
 
20

 
 
123

 
 
75

 
 
 
 
 
 
 
 
 
 
 
 
Other Financial Data
 
 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA attributable to MPLX LP (excluding predecessor results)(f)(g)
 
1,319



911



4,334



3,475

Adjusted EBITDA attributable to MPLX LP (including predecessor results)(f)(h)
 
1,319



1,246



5,104



3,810

DCF attributable to GP and LP unitholders(f)(h)
$
1,015

 
$
925

 
$
3,978

 
$
2,950

Distribution coverage ratio(i)
 
1.42x



1.80x



1.51x



1.49x

 
 
 
 
 
 
 
 
 
 
 
 
Cash Flow Data
 
 
 
 
 
 
 
 
 
 
 
Net cash flow provided by (used in):
 
 
 
 
 
 
 
 
 
 
 
Operating activities
$
1,092


$
1,044


$
4,082


$
3,071

Investing activities
 
(874
)
 
 
(851
)
 
 
(3,063
)
 
 
(2,878
)
Financing activities
$
(244
)
 
$
(147
)
 
$
(1,089
)
 
$
(117
)
 
 
 
 
 
 
 
 
 
 
 
 
(a)
The distribution on common units for 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 December 31, 2019 and $37.5 million for the twelve months ended December 31, 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 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. For the three months and year ended December 31, 2018, DCF attributable to predecessor for the fourth quarter has been included with no corresponding distribution being declared by MPLX relating to the predecessor, resulting in distribution coverage ratios of 1.80x and 1.49x, respectively. For the year ended December 31, 2019, DCF attributable to predecessor has been included with no corresponding distribution being declared by MPLX relating to the predecessor for the first quarter of 2019, resulting in a distribution coverage ratio of 1.51x.



10


Select Balance Sheet Data (unaudited)
 
 
 
 
 
(In millions, except ratio data)
 
Dec. 31, 2019
 
 
December 31, 2018(a)
Cash and cash equivalents
$
15

 
$
77

Total assets
 
40,430

 
 
39,325

Total long-term debt(b)
 
20,307

 
 
18,435

Redeemable preferred units
 
968

 
 
1,004

Total equity
$
16,613

 
$
17,731

Consolidated total debt to adjusted EBITDA(c)
 
4.1x

 
 
3.9x

 
 
 
 
 
 
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 $594 million as of December 31, 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 $406 million and $431 million of unamortized discount and debt issuance costs as of December 31, 2019 and December 31, 2018, respectively.


Operating Statistics (unaudited)(a)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended 
 Dec. 31
 
 
Year Ended 
 Dec. 31
 
 
2019
 
 
2018
 
% Change
 
 
2019
 
 
2018
 
% Change
Logistics and Storage
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pipeline throughput (mbpd)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Crude oil pipelines
 
3,196

 
 
3,214

 
(1
)%
 
 
3,228

 
 
3,121

 
3
%
Product pipelines
 
1,923

 
 
1,943

 
(1
)%
 
 
1,886

 
 
1,823

 
3
%
Total pipelines
 
5,119

 
 
5,157

 
(1
)%
 
 
5,114

 
 
4,944

 
3
%
Average tariff rates ($ per barrel)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Crude oil pipelines
$
0.97

 
$
0.85

 
14
 %
 
$
0.94

 
$
0.67

 
40
%
Product pipelines
 
0.78

 
 
0.67

 
16
 %
 
 
0.75

 
 
0.75

 
%
Total pipelines
$
0.90

 
$
0.78

 
15
 %
 
 
0.87

 
 
0.70

 
24
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Terminal throughput (mbpd)
 
3,313

 
 
3,188

 
4
 %
 
 
3,279

 
 
3,148

 
4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Barges at period-end
 
286

 
 
256

 
12
 %
 
 
286

 
 
256

 
12
%
Towboats at period-end
 
23

 
 
23

 
 %
 
 
23

 
 
23

 
%
(a)
Inclusive of predecessor operations beginning October 1, 2018.


11


Gathering and Processing Operating Statistics (unaudited) - Consolidated(a)
 
Three Months Ended 
 Dec. 31
 
 
Twelve Months Ended 
 Dec. 31
 
 
2019
 
 
2018
 
% Change
 
 
2019
 
 
2018
 
% Change
Gathering throughput (mmcf/d)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
1,329

 
 
1,148

 
16
 %
 
 
1,287

 
 
1,155

 
11
 %
Utica Operations
 

 
 

 
 %
 
 

 
 

 
 %
Southwest Operations
 
1,651

 
 
1,694

 
(3
)%
 
 
1,625

 
 
1,566

 
4
 %
Bakken Operations
 
158

 
 
147

 
7
 %
 
 
151

 
 
147

 
3
 %
Rockies Operations
 
602

 
 
654

 
(8
)%
 
 
630

 
 
654

 
(4
)%
Total gathering throughput
 
3,740

 
 
3,643

 
3
 %
 
 
3,693

 
 
3,522

 
5
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Natural gas processed (mmcf/d)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
4,136

 
 
3,977

 
4
 %
 
 
4,192

 
 
3,826

 
10
 %
Utica Operations
 

 
 

 
 %
 
 

 
 

 
 %
Southwest Operations
 
1,690

 
 
1,542

 
10
 %
 
 
1,629

 
 
1,438

 
13
 %
Southern Appalachian Operations
 
244

 
 
255

 
(4
)%
 
 
244

 
 
247

 
(1
)%
Bakken Operations
 
158

 
 
147

 
7
 %
 
 
151

 
 
147

 
3
 %
Rockies Operations
 
564

 
 
573

 
(2
)%
 
 
572

 
 
573

 
 %
Total natural gas processed
 
6,792

 
 
6,494

 
5
 %
 
 
6,788

 
 
6,231

 
9
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
C2 + NGLs fractionated (mbpd)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
446

 
 
398

 
12
 %
 
 
435

 
 
379

 
15
 %
Utica Operations
 

 
 

 
 %
 
 

 
 

 
 %
Southwest Operations
 
21

 
 
17

 
24
 %
 
 
15

 
 
18

 
(17
)%
Southern Appalachian Operations
 
13

 
 
18

 
(28
)%
 
 
12

 
 
15

 
(20
)%
Bakken Operations
 
31

 
 
15

 
107
 %
 
 
24

 
 
15

 
60
 %
Rockies Operations
 
5

 
 
4

 
25
 %
 
 
4

 
 
4

 
 %
Total C2 + NGLs fractionated
 
516

 
 
452

 
14
 %
 
 
490

 
 
431

 
14
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(a)
Includes operating data for entities that have been consolidated into the MPLX financial statements. Also inclusive of predecessor operations beginning October 1, 2018.


12


Gathering and Processing Operating Statistics (unaudited) - Operated(a)
 
Three Months Ended 
 Dec. 31
 
 
Twelve Months Ended 
 Dec. 31
 
 
2019
 
 
2018
 
% Change
 
 
2019
 
 
2018
 
% Change
Gathering throughput (mmcf/d)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
1,329

 
 
1,148

 
16
 %
 
 
1,287

 
 
1,155

 
11
 %
Utica Operations
 
2,241

 
 
2,067

 
8
 %
 
 
2,200

 
 
1,809

 
22
 %
Southwest Operations
 
1,658

 
 
1,694

 
(2
)%
 
 
1,628

 
 
1,567

 
4
 %
Bakken Operations
 
158

 
 
147

 
7
 %
 
 
151

 
 
147

 
3
 %
Rockies Operations
 
806

 
 
841

 
(4
)%
 
 
828

 
 
841

 
(2
)%
Total gathering throughput
 
6,192

 
 
5,897

 
5
 %
 
 
6,094

 
 
5,519

 
10
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Natural gas processed (mmcf/d)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
5,339

 
 
4,773

 
12
 %
 
 
5,248

 
 
4,448

 
18
 %
Utica Operations
 
734

 
 
877

 
(16
)%
 
 
810

 
 
886

 
(9
)%
Southwest Operations
 
1,720

 
 
1,542

 
12
 %
 
 
1,636

 
 
1,438

 
14
 %
Southern Appalachian Operations
 
244

 
 
255

 
(4
)%
 
 
244

 
 
247

 
(1
)%
Bakken Operations
 
158

 
 
147

 
7
 %
 
 
151

 
 
147

 
3
 %
Rockies Operations
 
564

 
 
573

 
(2
)%
 
 
572

 
 
573

 
 %
Total natural gas processed
 
8,759

 
 
8,167

 
7
 %
 
 
8,661

 
 
7,739

 
12
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
C2 + NGLs fractionated (mbpd)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marcellus Operations
 
446

 
 
398

 
12
 %
 
 
435

 
 
379

 
15
 %
Utica Operations
 
41

 
 
50

 
(18
)%
 
 
44

 
 
47

 
(6
)%
Southwest Operations
 
21

 
 
17

 
24
 %
 
 
15

 
 
18

 
(17
)%
Southern Appalachian Operations
 
13

 
 
18

 
(28
)%
 
 
12

 
 
15

 
(20
)%
Bakken Operations
 
31

 
 
15

 
107
 %
 
 
24

 
 
15

 
60
 %
Rockies Operations
 
5

 
 
4

 
25
 %
 
 
4

 
 
4

 
 %
Total C2 + NGLs fractionated
 
557

 
 
502

 
11
 %
 
 
534

 
 
478

 
12
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(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 inclusive of predecessor operations beginning October 1, 2018.


13


Reconciliation of Segment Adjusted EBITDA to Net Income (unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended 
 Dec. 31
 
 
Year Ended 
 Dec. 31
(In millions)
 
2019
 
 
2018
 
 
2019
 
 
2018
L&S segment adjusted EBITDA attributable to MPLX LP (including predecessor results)
$
853

 
$
809

 
$
3,351

 
$
2,319

G&P segment adjusted EBITDA attributable to MPLX LP (including predecessor results)
 
466

 
 
437

 
 
1,753

 
 
1,491

Adjusted EBITDA attributable to MPLX LP (including predecessor results)
 
1,319

 
 
1,246

 
 
5,104

 
 
3,810

Depreciation and amortization
 
(338
)
 
 
(302
)
 
 
(1,254
)
 
 
(867
)
Benefit (provision) for income taxes
 
2

 
 

 
 

 
 
(8
)
Amortization of deferred financing costs
 
(13
)
 
 
(10
)
 
 
(42
)
 
 
(55
)
Loss on extinguishment of debt
 

 
 
(46
)
 
 

 
 
(46
)
Non-cash equity-based compensation
 
(5
)
 
 
(8
)
 
 
(22
)
 
 
(23
)
Impairment expense
 
(1,197
)
 
 

 
 
(1,197
)
 
 

Net interest and other financial costs
 
(216
)
 
 
(224
)
 
 
(873
)
 
 
(613
)
Income from equity method investments
 
35

 
 
72

 
 
290

 
 
247

Distributions/adjustments related to equity method investments
 
(163
)
 
 
(144
)
 
 
(562
)
 
 
(458
)
Unrealized derivative (losses) gains(a)
 
(6
)
 
 
23

 
 
1

 
 
5

Acquisition costs
 

 
 
(1
)
 
 
(14
)
 
 
(4
)
Other
 

 
 

 
 
(1
)
 
 

Adjusted EBITDA attributable to noncontrolling interests
 
9

 
 
5

 
 
32

 
 
18

Net income
$
(573
)
 
$
611

 
$
1,462

 
$
2,006

 
 
 
 
 
 
 
 
 
 
 
 
(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 
 Dec. 31
 
Year Ended 
 Dec. 31
(In millions)
 
2019
 
 
2018
 
 
2019
 
 
2018
L&S segment income from operations
$
677

 
$
637

 
$
2,752

 
$
1,924

Depreciation and amortization
 
130

 
 
137

 
 
503

 
 
308

Income from equity method investments
 
(41
)
 
 
(48
)
 
 
(200
)
 
 
(171
)
Distributions/adjustments related to equity method investments
 
83

 
 
78

 
 
267

 
 
242

Acquisition costs
 

 
 
1

 
 
14

 
 
4

Non-cash equity-based compensation
 
4

 
 
4

 
 
14

 
 
12

Other
 

 
 

 
 
1

 
 

L&S segment adjusted EBITDA attributable to MPLX LP (including predecessor results)
 
853



809

 
 
3,351



2,319

L&S predecessor segment adjusted EBITDA attributable to MPLX LP
 

 
 
(262
)
 
 
(603
)
 
 
(262
)
L&S segment adjusted EBITDA attributable to MPLX LP
$
853

 
$
547

 
$
2,748

 
$
2,057

 
 
 
 
 
 
 
 
 
 
 
 

G&P Reconciliation of Segment Income from Operations to Segment Adjusted EBITDA (unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended 
 Dec. 31
 
Year Ended 
 Dec. 31
(In millions)
 
2019
 
 
2018
 
 
2019
 
 
2018
G&P segment income from operations
$
(1,023
)
 
$
254

 
$
(375
)
 
$
804

Depreciation and amortization
 
208

 
 
165

 
 
751

 
 
559

Impairment expense
 
1,197

 
 

 
 
1,197

 
 

Loss (Income) from equity method investments
 
6

 
 
(24
)
 
 
(90
)
 
 
(76
)
Distributions/adjustments related to equity method investments
 
80

 
 
66

 
 
295

 
 
216

Unrealized derivative losses (gains)(a)
 
6

 
 
(23
)
 
 
(1
)
 
 
(5
)
Non-cash equity-based compensation
 
1

 
 
5

 
 
8

 
 
12

Adjusted EBITDA attributable to noncontrolling interest
 
(9
)
 
 
(6
)
 
 
(32
)
 
 
(19
)
G&P segment adjusted EBITDA attributable to MPLX LP (including predecessor results)
 
466

 
 
437

 
 
1,753

 
 
1,491

G&P predecessor segment adjusted EBITDA attributable to MPLX LP
 

 
 
(73
)
 
 
(167
)
 
 
(73
)
G&P segment adjusted EBITDA attributable to MPLX LP
$
466


$
364

 
$
1,586


$
1,418

 
 
 
 
 
 
 
 
 
 
 
 
(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 
 Dec. 31
 
 
Year Ended 
 Dec. 31
(In millions)
 
2019
 
 
2018
 
 
2019
 
 
2018
Net income
$
(573
)
 
$
611

 
$
1,462

 
$
2,006

(Benefit) provision for income taxes
 
(2
)
 
 

 
 

 
 
8

Amortization of deferred financing costs
 
13

 
 
10

 
 
42

 
 
55

Loss on extinguishment of debt
 

 
 
46

 
 

 
 
46

Net interest and other financial costs
 
216

 
 
224

 
 
873

 
 
613

Income from operations
 
(346
)
 
 
891

 
 
2,377

 
 
2,728

Depreciation and amortization
 
338

 
 
302

 
 
1,254

 
 
867

Non-cash equity-based compensation
 
5

 
 
8

 
 
22

 
 
23

Impairment expense
 
1,197

 
 

 
 
1,197

 
 

Income from equity method investments
 
(35
)
 
 
(72
)
 
 
(290
)
 
 
(247
)
Distributions/adjustments related to equity method investments
 
163

 
 
144

 
 
562

 
 
458

Unrealized derivative losses (gains)(a)
 
6

 
 
(23
)
 
 
(1
)
 
 
(5
)
Acquisition costs
 

 
 
1

 
 
14

 
 
4

Other
 

 
 

 
 
1

 
 

Adjusted EBITDA
 
1,328

 
 
1,251

 
 
5,136

 
 
3,828

Adjusted EBITDA attributable to noncontrolling interests
 
(9
)


(5
)


(32
)


(18
)
Adjusted EBITDA attributable to predecessor(b)
 



(335
)


(770
)


(335
)
Adjusted EBITDA attributable to MPLX LP
 
1,319

 
 
911

 
 
4,334

 
 
3,475

Deferred revenue impacts
 
27



4



94



28

Net interest and other financial costs
 
(216
)


(224
)


(873
)


(613
)
Maintenance capital expenditures
 
(88
)


(77
)


(262
)


(175
)
Maintenance capital expenditures reimbursements
 
19



8



53



8

Equity method investment capital expenditures paid out
 
(12
)


(9
)


(28
)


(31
)
Other
 
(4
)


7



12



8

Portion of DCF adjustments attributable to predecessor(b)
 



81



159



81

DCF attributable to MPLX LP
 
1,045



701



3,489



2,781

Preferred unit distributions(c)
 
(30
)


(30
)


(122
)


(85
)
DCF attributable to GP and LP unitholders (excluding predecessor results)
 
1,015

 
 
671

 
 
3,367

 
 
2,696

Adjusted EBITDA attributable to predecessor(b)
 



335



770



335

Portion of DCF adjustments attributable to predecessor(b)
 



(81
)


(159
)


(81
)
DCF attributable to GP and LP unitholders (including predecessor results)
$
1,015

 
$
925

 
$
3,978

 
$
2,950

 
 
 
 
 
 
 
 
 
 
 
 
(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 (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)
 
 
 
 
Year Ended 
 Dec. 31
(In millions)
 
2019
 
 
2018
LTM Net income
$
1,462

 
$
1,834

LTM Net income to adjusted EBITDA adjustments
 
2,872

 
 
1,641

LTM Adjusted EBITDA attributable to MPLX LP
 
4,334

 
 
3,475

LTM Pro forma/Predecessor adjustments for acquisitions
 
770

 
 
92

LTM Pro forma adjusted EBITDA
 
5,104

 
 
3,567

Consolidated debt
$
20,713

 
$
13,856

Consolidated debt to adjusted EBITDA(a)
 
4.1x