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    EPD
    Earnings call· Jun 2026(Q2 FY26)

    ENTERPRISE PRODUCTS PARTNERS Q2 FY26 earnings call EPD

    Jul 30, 2026 Source

    Executive summary

    Enterprise Products Partners L.P. Q2 FY26 — Record EBITDA and Strong Volume Growth

    Enterprise Products Partners delivered a strong second quarter, driven by robust global demand for U.S. energy and exceptional operational execution. The company achieved record EBITDA and cash flow, supported by significant volume growth across its integrated system. Management highlighted the flexibility and reliability of its assets as key competitive advantages, while also sanctioning new growth projects to support continued Permian Basin expansion. The company maintains a disciplined capital program and strong balance sheet, positioning it for future growth despite market volatility.

    Highlights

    5

    • Generated a record $2.8 billion of EBITDA, a 17% increase over Q2 FY25.

    • Adjusted cash flow from operations increased 19% to a record $2.5 billion.

    • Total pipeline volumes were up 8% and marine terminal volumes were up 33% compared to Q2 FY25.

    • Permian natural gas processing inlet volumes increased 14% over Q2 FY25, reaching 4.3 Bcf/d.

    • Consolidated leverage ratio decreased to 3.0x, meeting the target.

    Concerns

    2

    • LPG export listing rates have fallen due to increased capacity, potentially leading to lower terminal fees and rates.

    • PDH2 experienced an issue in July, causing downtime, though it is now back online.

    Guidance & targets

    6
    CategoryTargetConfidence
    Growth Capital Expenditures
    $2.9 billion to $3.4 billion
    high materiality
    High
    Growth Capital Expenditures
    in the $3 billion area
    high materiality
    High
    Sustaining Capital Expenditures
    approximately $600 million
    medium materiality
    High
    Discretionary Free Cash Flow
    potential to approach the $1 billion area
    high materiality
    Medium
    EBITDA Growth
    10% area growth
    high materiality
    Medium
    Permian Plant Cadence
    closer to 2 per year
    medium materiality
    Medium

    Segment performance

    6
    SegmentRevenueYoYQoQMargin
    Total Company
    Strong overall volumes driven by global demand for U.S. energy. Record pipeline and marine terminal volumes.
    Total oil equivalent moved: 14.7 MMBbl/dTotal barrels moved across docks: 2.8 MMBbl/dNatural gas processing inlet volumes: 8.1 Bcf/d
    		————
    Permian Basin
    Significant growth in producer activity, driving increased inlet volumes. New processing plants (Plant 11, Plant 13) and NGL frac (Plant 15) approved to support continued expansion.
    Natural gas processing inlet volumes: 4.3 Bcf/d
    		—14%——
    NGL Pipeline Systems
    Operating at high utilization, indicating strong demand for NGL transportation.
    Capacity utilization: 86%
    		————
    LPG Export
    Despite increased market capacity and potential for lower rates, Enterprise's capacity is largely contracted, limiting exposure. Neches River NGL marine terminal expansion expected in service by year-end.
    Contracted capacity: 90%
    		————
    Sour Gas
    Demand remains strong, system was full prior to new capacity. Evaluating Train 6 due to continued producer activity and interest.
    Treating capacity: 750 MMcf/d
    		————
    Haynesville
    Production growth slowly creeping up. Louisiana intrastate system for Haynesville extension and lateral to LNG markets are sold out, indicating strong demand pull.
    Production: close to 16 Bcf
    		————

    Operational metrics

    18
    Adjusted EBITDA
    $2.8 billion17% increase over Q2 FY25
    Q2 FY26

    Record EBITDA for the quarter.

    Distribution Coverage
    1x
    Q2 FY26

    Coverage of distributions for the quarter.

    Declared Distribution per Common Unit
    $0.562.8% increase over Q2 FY25
    Q2 FY26

    To be paid August 14 to unitholders of record as of July 31.

    Share Buyback
    $159 million
    Q2 FY26

    Repurchases under the $5 billion buyback program.

    DRIP and EUIPP Purchases
    $40 million
    Q2 FY26

    Open market purchases by distribution reinvestment plan and employee unit purchase plan.

    Total Shareholder Return
    $5.2 billion
    LTM ending June 30, 2026

    Combined distributions and buybacks over the last twelve months.

    Payout Ratio of Adjusted Cash Flow from Operations
    56%
    LTM ending June 30, 2026

    Reflects the proportion of cash flow returned to unitholders.

    Total Capital Investments
    $1.2 billion
    Q2 FY26

    Total capital deployed in the second quarter.

    Total Debt Principal Outstanding
    $33.5 billion
    End of Q2 FY26

    Absolute debt balance at quarter end.

    Weighted Average Life of Debt Portfolio
    17 years
    End of Q2 FY26

    Long-term debt profile.

    Weighted Average Cost of Debt
    4.7%
    End of Q2 FY26

    Cost and fixed-rate portion of the debt.

    Consolidated Liquidity
    $5 billionincreased from $4 billion
    End of Q2 FY26

    Increased liquidity to manage commodity price volatility and working capital needs.

    Consolidated Leverage Ratio
    3.0xdecreased
    End of Q2 FY26

    Achieved target leverage ratio.

    EBITDA from Global Demand Pull
    around $200 million
    April and May 2026

    Benefit from acute global demand for U.S. energy during the period.

    Sour Gas Treating Capacity
    750 MMcf/d
    Current

    Demand has remained strong, system was essentially full prior to new capacity.

    Haynesville Production
    close to 16 Bcfslowly creeping up over the year
    Current

    Constructive trend in natural gas production from the Haynesville basin.

    Haynesville Extension Pipe Throughput
    sold out
    Current

    Large demand for the pipe.

    Lateral to LNG Markets Throughput
    800 million to 1 billion cubic feet a day
    Current

    Running at high capacity and sold out.

    Industry KPIs

    5
    MetricValueDetails
    Pipeline throughput storage86%%
    Sanctioned expansion backlog—
    Basin level production volume4.3 Bcf/dBcf/d
    FCF shareholder distributions$5.2 billionUSD
    Take or pay contract structure90%%

    Capital programs

    5
    Neches River NGL Marine Terminal Expansionnearing completion

    Scheduled for completion by the end of 2026, expected to create opportunities as global demand for U.S. hydrocarbons grows.

    Plant 11 (Midland Basin Natural Gas Processing)underway

    Benefit: 300 MMcf/d

    Approved for construction to support continued growth in producer activity in the Permian. Initial spending on long lead items contributed to increased 2026 CapEx.

    Plant 13 (Delaware Basin Natural Gas Processing)underway

    Benefit: 300 MMcf/d

    Approved for construction to support continued growth in producer activity in the Permian. Initial spending on long lead items contributed to increased 2026 CapEx.

    Plant 15 (Mont Belvieu NGL Frac)underway

    Benefit: 150,000 bbl/d

    Approved for construction to support increased NGL volumes. Initial spending on long lead items contributed to increased 2026 CapEx.

    Natural Gas Gathering, Compression and Power Generation Facilities (Permian Basin)underway

    Capital allocated to support growth in the Permian Basin, especially in the Delaware where self-generated power is often required.

    Risks & headwinds

    2
    LPG export capacity overbuildnext 12 to 18 months

    May see a period of time where we have less volatility in terminal fees and just overall lower rates than we've seen in the last couple of years

    Mitigation: Enterprise's LPG export capacity is approximately 90% contracted, limiting exposure to market fluctuations.

    PDH2 operational issueJuly

    PDH2 was down

    Mitigation: PDH2 is back up and running.

    What to watch in Q3 FY26

    4

    Neches River NGL Marine Terminal Expansion In-Service

    Q4 FY26
    CurrentAhead of schedule, commissioning underway
    TargetIn service by end of year

    Why it matters

    Successful commissioning and in-service of this expansion will unlock additional LPG export capacity and support growing global demand for U.S. hydrocarbons.

    With that next major project scheduled for completion -- scheduled for completion is our LPG export terminal expansion on the Neches River channel. That should be in service by the end of this year.

    Q&A highlights

    5

    Has LPG export capacity become overbuilt, leading to falling listing rates, and will the upcoming 300 kt expansion be more fully utilized due to take-or-pay contracts?

    Management acknowledged that new capacity has led to lower terminal fees and rates, but stated that Enterprise's LPG export capacity is about 90% contracted, limiting exposure to market volatility. The Neches River Terminal (NRT) expansion will also benefit from additional ethane volumes.

    “From our standpoint, we've been very intentional about contracting our capacity. So our EHT expansion and really all of our system-wide capacity around LPG export, as we've said, we're about 90% contracted. So we have relatively limited exposure to that scenario.”

    asked by Jean Ann Salisbury (Analysts) · answered by Tyler Cott (Executives)

    2 min read6 chapters

    Detailed Narrative

    01

    Strong Operational Performance and Volume Growth

    Enterprise Products Partners reported robust operational performance in Q2 FY26, driven by strong global demand for U.S. energy. The company's export facilities, pipelines, storage assets, and fractionation complexes demonstrated high utilization. Total pipeline volumes increased by 8% year-over-year, and marine terminal volumes saw an outstanding 33% increase. The company moved 14.7 million barrels a day of oil equivalent and 2.8 million barrels per day across its docks, reflecting significant demand pull.

    02

    Permian Basin Expansion and Infrastructure Investments

    The Permian Basin continues to be a key growth driver, with natural gas processing inlet volumes increasing 14% year-over-year to 4.3 Bcf/d. To support this growth, Enterprise approved the construction of two new 300 MMcf/d natural gas processing plants (Plant 11 in Midland, Plant 13 in Delaware) and a new 150,000 bbl/d NGL frac (Plant 15 in Mont Belvieu). These projects are expected to come online between Q3 2028 and Q1 2029, providing additional processing capacity and NGL volumes for the company's integrated value chain.

    03

    Capital Discipline and Shareholder Returns

    The partnership maintained its commitment to capital discipline and shareholder returns. It repurchased $159 million of common units in Q2 FY26, bringing year-to-date repurchases to $275 million and cumulative utilization of its $5 billion buyback program to 34%. The declared distribution increased by 2.8% to $0.56 per common unit. Total shareholder returns (distributions + buybacks) for the last 12 months amounted to $5.2 billion, representing a 56% payout ratio of adjusted cash flow from operations.

    04

    Liquidity and Leverage Management

    Enterprise ended the quarter with strong consolidated liquidity of approximately $4 billion, which was further boosted to $5 billion by an incremental $1 billion short-term credit facility. This move was made to manage potential working capital needs due to commodity price volatility. The company successfully reduced its consolidated leverage ratio to 3.0x on a net basis, aligning with its target of 3x plus or minus 0.25, demonstrating balance sheet resilience.

    05

    Market Dynamics and Commodity Spreads

    The second quarter benefited from an acute global demand for U.S. energy, particularly in April and May, which resulted in approximately $200 million in higher margins across crude, NGL, and petrochemicals. While these strong cash differentials have largely normalized, management noted their ability to execute on volatility. The company also discussed the Waha gas market, indicating that while prices have tightened, a healthy Waha price is preferred to support producer economics and long-term infrastructure development.

    06

    Leadership Transition and Future Outlook

    Co-CEO Jim Teague announced his retirement, marking the end of a 28-year tenure at Enterprise. The company expressed confidence in its leadership succession and the talent within the organization. The outlook remains constructive, with continued demand for U.S. energy supporting system utilization. The company anticipates volume-driven EBITDA growth, with potential for 10% growth into FY27, excluding commodity price benefits.

    AI-generated summary of the company’s earnings call. Not investment advice.