Enterprise GP Holdings Reports Fourth Quarter and Full-Year 2007 Results

Business Wire, Feb 12, 2008

HOUSTON -- Enterprise GP Holdings L.P. (NYSE:EPE) today announced its consolidated and parent-only financial results for the three months and year ended December 31, 2007. Enterprise GP Holdings, the parent company, reported record distributable cash flow of $56 million for the fourth quarter of 2007. Distributable cash flow for the fourth quarter of 2007 provided 1.1 times coverage of the $0.41 per unit distribution declared by the board of the general partner of Enterprise GP Holdings with respect to the fourth quarter of 2007 that was paid on February 8, 2008. This distribution rate represents a 17 percent increase from $0.35 per unit paid with respect to the fourth quarter of 2006. Distributable cash flow is a non-generally accepted accounting principle (or "non-GAAP") financial measure that is defined and reconciled later in this press release to its most directly comparable accounting principles generally accepted (or "GAAP") measure, which is net cash flow provided by operating activities.

Enterprise GP Holdings will receive $78 million of total cash distributions with respect to the fourth quarter of 2007. These distributions are comprised of $41 million from Enterprise Products Partners L.P. (paid February 7), $15 million from TEPPCO Partners, L.P. (paid February 7) and $22 million from Energy Transfer Equity, L.P. (payable February 19). This represents a 56 percent increase from the $50 million in distributions received with respect to the fourth quarter of 2006. The increase was due to the acquisition of partnership interest in Energy Transfer Equity and increases in cash distributions from Enterprise Products Partners and TEPPCO. The cash distribution from Energy Transfer Equity to be received on February 19 is for a four-month period (September 2007 to December 2007) due to Energy Transfer Equity's transition from a fiscal year to a calendar year basis for financial reporting and cash distribution purposes. As a result, the cash distribution that Enterprise GP Holdings will receive from Energy Transfer Equity includes an additional $5.5 million relating to the extra month.

Enterprise GP Holdings reported consolidated net income for the fourth quarter of 2007 of $22 million, or $0.18 per unit on a fully diluted basis, compared to $35 million, or $0.34 per unit on a fully diluted basis, for the fourth quarter of 2006. The decrease in consolidated net income is largely attributable to an increase in interest expense from a higher average debt balance associated with the acquisition of partnership interests in Energy Transfer Equity and the amortization of associated debt issuance costs.

The earnings per unit calculation for the fourth quarter of 2007 is based on 123.2 million average units outstanding, which is comprised of 88.9 million units issued in August 2005, 14.2 million units (formerly Class B units) issued as part of the consideration for the acquisition of partner interests in TEPPCO and its general partner in May 2007, and 20.1 million units issued in July 2007 in a private placement with institutions that were subsequently registered. The earnings per unit calculation for the fourth quarter of 2006 are based on 103.1 million units, which exclude the units issued in the private placement in July 2007.

Distributable cash flow for 2007 increased 12 percent to a record $199 million from $178 million for 2006. Distributable cash flow for 2007 provided 1.0 times coverage of the $1.55 of cash distributions that were declared with respect to 2007. Enterprise GP Holdings reported consolidated net income for 2007 of $109 million, or $0.97 per unit on a fully diluted basis, compared to $134 million, or $1.30 per unit on a fully diluted basis, for 2006. The decrease in consolidated net income for 2007 relative to 2006 was due to the same reasons mentioned previously for the decrease in fourth quarter net income.

"We were very pleased with the record distributable cash flow generated by Enterprise GP Holdings for the fourth quarter of 2007," said Dr. Ralph S. Cunningham, president and chief executive officer of Enterprise GP Holdings. "We benefited from distribution increases from Enterprise Products and Energy Transfer Equity. Part of the distribution increase from Energy Transfer Equity was driven by an increase in general partner distributions related to an issuance of 5 million units by Energy Transfer Partners, L.P. in December 2007."

"Looking ahead to 2008, each of the operating partnerships in which we own GP and LP interests has completed major growth projects or acquisitions. These include Enterprise Products' projects at Independence Hub, Meeker, Pioneer and Hobbs and TEPPCO's recent $500 million asset purchase to enter into the marine transportation of refined products and crude oil business. As these investments generate incremental cash flow and the partnerships increase their cash distributions and issue limited partner units to fund their growth, we will disproportionately benefit through the leverage we have from our ownership of general partner incentive distribution rights," stated Cunningham.