MPLX LP Reports Q3 2023 Financial Results: Net Income of $918 Million
MPLX LP (NYSE:MPLX) reported a net income of $918 million in Q3 2023, a decrease from $1,428 million in Q3 2022.
The company generated net cash provided by operating activities of $1,244 million and distributable cash flow of $1,373 million.
MPLX returned $799 million in capital to unitholders through distributions and announced a 10% increase in quarterly distribution to $0.85 per unit.
Adjusted EBITDA attributable to MPLX was $1,596 million, showing an increase from $1,471 million in Q3 2022.
On October 31, 2023, MPLX LP (NYSE:MPLX) released its third-quarter 2023 financial results. The company reported a net income attributable to MPLX of $918 million, a decrease from $1,428 million in the third quarter of 2022. The decrease in net income was due to a $509 million non-cash gain from the reclassification of a third-party contract in Q3 2022.
Financial Highlights
The company's adjusted EBITDA attributable to MPLX was $1,596 million, showing an increase from $1,471 million in Q3 2022. The Logistics and Storage (L&S) segment adjusted EBITDA for Q3 2023 was $1,091 million, compared with $969 million for Q3 2022. The Gathering and Processing (G&P) segment adjusted EBITDA for Q3 2023 was $505 million, compared with $502 million for Q3 2022.
During the quarter, MPLX generated $1,244 million in net cash provided by operating activities, $1,373 million of distributable cash flow, and adjusted free cash flow of $1,004 million. In the first nine months of the year, MPLX generated $3,908 million in net cash provided by operating activities, $3,956 million of distributable cash flow, and adjusted free cash flow of $3,171 million.
Capital Return and Distribution Increase
MPLX returned $799 million to unitholders and announced a third-quarter 2023 distribution of $0.85 per common unit, resulting in a distribution coverage ratio of 1.6x for the quarter. The leverage ratio was 3.4x at the end of the quarter. "Our business continues to grow and generate strong cash flow," said Michael J. Hennigan, MPLX chairman, president, and chief executive officer. "We announced a 10% increase to our distribution, and through the first nine months of the year we have grown distributable cash flow over 6% compared to the same period in 2022.
Segment Results and Strategic Update
The L&S segment adjusted EBITDA for Q3 2023 increased by $122 million compared to the same period in 2022, primarily driven by higher rates, growth from equity affiliates, and higher total throughputs. The G&P segment adjusted EBITDA for Q3 2023 increased by $3 million compared to the same period in 2022 as higher volumes and throughput fees were offset by lower natural gas liquids prices.
In the strategic update, MPLX is expanding its natural gas and natural gas liquids long-haul and crude gathering pipelines supporting the Permian and Bakken basins. In the G&P segment, MPLX remains focused on the Permian and Marcellus basins in response to producer demand.
Financial Position and Liquidity
As of September 30, 2023, MPLX had $960 million in cash, $2 billion available on its bank revolving credit facility, and $1.5 billion available through its intercompany loan agreement with Marathon Petroleum Corp. (NYSE: MPC). MPLX's leverage ratio was 3.4x, while the stability of cash flows supports leverage in the range of 4.0x.
Explore the complete 8-K earnings release (here) from MPLX LP for further details.
This article first appeared on GuruFocus.
