PLAINS GP HOLDINGS (PAGP) has reported a 19.28 percent rise in profit for the quarter ended Sep. 30, 2016. The company has earned $297 million, or $0.40 a share in the quarter, compared with $249 million, or $0.24 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $293 million, or $0.39 a share compared with $262 million or $0.28 a share, a year ago.
Revenue during the quarter dropped 6.86 percent to $5,170 million from $5,551 million in the previous year period. Gross margin for the quarter contracted 98 basis points over the previous year period to 14.33 percent. Total expenses were 93.25 percent of quarterly revenues, down from 93.97 percent for the same period last year. This has led to an improvement of 72 basis points in operating margin to 6.75 percent.
Operating income for the quarter was $349 million, compared with $335 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $450 million compared with $497 million in the prior year period. At the same time, adjusted EBITDA margin contracted 25 basis points in the quarter to 8.70 percent from 8.95 percent in the last year period.
"PAA reported third-quarter adjusted EBITDA of $450 million, which included solid performance in our fee-based Facilities segment and in-line performance from our fee-based Transportation segment, offset by Supply and Logistics segment performance that was below the low-end of our third quarter guidance. Our third quarter Supply and Logistics segment was impacted by a combination of delayed EBITDA recognition associated with our NGL inventory costing and the timing of crude oil sales, as well as lower than forecasted EBITDA as a result of continued margin compression and less favorable market conditions for both our crude oil and NGL activities," said Greg Armstrong, chairman and chief executive officer of Plains All American.
Working capital remains negative
Working capital of PLAINS GP HOLDINGS was negative $304 million on Sep. 30, 2016 compared with negative $519 million on Sep. 30, 2015. Current ratio was at 0.93 as on Sep. 30, 2016, up from 0.85 on Sep. 30, 2015.
Days sales outstanding went down to 24 days for the quarter compared with 38 days for the same period last year.
Debt comes down
PLAINS GP HOLDINGS has recorded a decline in total debt over the last one year. It stood at $9,634 million as on Sep. 30, 2016, down 14.06 percent or $1,576 million from $11,210 million on Sep. 30, 2015. Total debt was 40.98 percent of total assets as on Sep. 30, 2016, compared with 46.54 percent on Sep. 30, 2015. Interest coverage ratio improved to 3.09 for the quarter from 3.07 for the same period last year.
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