MMP - Earnings call transcript Q4 2020 | Magellan Midstream Partners, L.P.

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Operator

Greetings, everyone, and welcome to the Fourth Quarter 2020 Earnings Call.

During the presentation, all participants will be in listen-only mode. Afterwards, we will have a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded today, Tuesday, February 2, 2021. I would now like to turn the call over to Mike Mears, Chief Executive Officer. ahead. go Please

Mike Mears

you quarter thank us for today Hello call. for fourth earnings our and joining

Before I by materially could get judgments future making statements we performance started, based different. regarding forward-looking will that are but could statements be the management of factors as impact our Magellan, be defined on the that Such must SEC. current remind the you outcomes actual

other own information SEC should about discussed impact our the on You factors demand commodity having review Magellan the your risk continued petroleum is filings with results, and performance. and future prices. and form XXXX solid opinions the Magellan's with negative out especially pandemic products in closed the financial considering

incremental our higher-than-expected rates Our average tariff products benefit refined and fourth results to from our quarter shipments for exceeded system. expectations, pipeline primarily the due

While demand, of pre-pandemic we progress back continues not are to made. be levels yet to

our year morning back financial our conversion CFO, your now quarter and the this to results Jeff analysis be questions. I'll answering fourth Then corporate posted the review our versus to for period. XXXX website will Holman, before outlook Our discuss ago

Jeff Holman

Mike. Thanks,

flow, including First, margin references to these metrics metrics, be GAAP let and nearest as measures. making to mention non-GAAP we've financial distributable release me I'll some included and that reconcile that, usual, or cash exhibits earnings DCF, operating our to their

portion quarter our of morning, single this for last $XXX fourth excludes we for the unit being income of reported higher impact which which, refined quarter $XXX than net mark-to-market XXXX, earnings XX% pandemic-related and performance pandemic, factors higher in we fourth product coverage DCF our out, times. fourth driver outbreak the as rates. guidance of was year the Full pointed the system southern results. stronger-than-expected in a commodity-related other year With million quarter the resulting our $X.XX, was commentary outperformance to the adjustments, billion, was our lower as the $XXX quarter impact the versus fall. for million, negatively to about X.XX quarter, million, the both our and of is provided as of ratio continue as compared with commodity result price lower higher Mike since largest was expectations, XXXX earlier XXXX. distribution $X.XX environment volumes So the average of $X.XX a than of per for XXXX DCF consistent Adjusted

we both underscores we and model target what our prices, While the this at X.XX to our this the guidance year Even commodity result with times same a in refined decline financial severe to long-stated were original in million of strength saw excess more below of believe generate was decline our this able our present resilience the than $XXX in products time is, simply company. unprecedented nevertheless of of times, X.X we that of about in the business demand, course, XXXX a cash. of and

earnings morning. we You quarter-over-quarter detailed find description in the can release of issued variances this the a

and overall highlights versus of period. XXXX of Refined in the generated million XXXX, So few products themes quarter $XXX on XX% I margin approximately quarterly touch just fourth to down our plan a performance. operating

all in South volumes are frequently Texas quarter product system, of continues portion activity rates of average the volumes to lows our rest at the were impact effects and calls, particularly volatile, saw significantly mix which, the about more the previous from while refined lower X% the we in across remained our drilling continue lower lower period. we system. both as to during XXXX and some distillate impact than of on our negatively our serve, second higher volumes system. we tariff of product While the metropolitan grind aviation by That move areas the than than figure the of gasoline our system Total impacted and noted includes of pandemic, volumes the somewhat volatile more XXXX, in

our impact the volumes specifically, was for quarter actually are of that levels. and our base X% that growth down product combined aviation recently And, while volumes, base XXXX projects. impact product by we distillate between mentioned business variances more Texas, XXXX figures South growth the versus have were X% and previously note Please up versus X% both just by broken down out I gasoline and Excluding XX%. the down these was of fuel volumes completed

commitments are to of demand demand drive been that remains were is backed has in In would generally in rig new distillate reduced by demand the effect expectations, we what new recovering from our significantly expanded customers and some pandemic assets our system. as volumes satisfied our conditions expect. the more contracts those that the by projects base a to otherwise by characterize the current counts, than of to environment, portion is of the impacted those volumes those would recall, have volumes commitments, such you'll gasoline still the customer As base tracking as which cases served while been underperformed meeting growth by impacts market

when but on these of had positive Of that And timing expansions. activity. economic expectations in drilling distillate to recovery general assets conditions initially and pace both the we uncertain as continues depend the signs XXXX. the total will recovery demand to expanded quarter on volumes, course, in Especially promising expect recover, we undertook saw of meet we remain fourth we volumes and and that

the We take own East by customer's construction connection And to that be a currently delayed by Houston-to-Hearne their COVID-related addition, only effect commitments has of the mid-XXXX. been that connection to In issues. construction asset. that portion of completes to our once committed customer forecast the complete expansion

picture volume our rates So transportation due the we increase having to offset the tariff in mid-XXXX. all note X.X% experienced higher primarily volume that overall partially discuss declines average to average

to activities our the business in blending margins volumes affected on XXXX in gas fourth in our $X.XX opportunities. products fewer refined quarter due being our revenue, results lower from XXXX versus financial liquids from fourth economic also about that business quarter by as with negatively commodity-related $X.XX XXXX, buying declined transportation profitability also to declined Beyond

Finally, the the in marine sale segment. reduced refined early XXXX also from contribution terminals three of the

decline. quarter to $XXX offset operating So oil operating down our partially lower XX% approximately With business that's crude the was fourth million regards expenses fourth from quarter the margin XXXX.

tariff lower in a the in averaged the per During impacted shipped. decrease about was crude fourth average oil by long-haul quarter, barrels quarter of as as the well mainly on day to business Volumes a volume XXX,XXX XXX,XXX by compared day rates XXXX.

recall the of day you at third shift barrels may of to commitments per our the near quarter. that While XX,XXX commitment customers levels, continue or long-haul expired end at the

to While earning prevailing the was margin Basin show contracts. to the and marketing of differential resulting activities. currently had offset The the on Houston, Permian by tariffs is you well the largely shipments realized decrease recently volume our affiliate expired which below between reflective in is the those we in third-party been more activities we

As XXXX our year the during on expectations quarter period declined average result, full provided barrel fourth when and in rate during the quarter Seabrook as a per discussed terminal previous realized the we partly to Houston guidance. on we we've Volumes a our distribution due our declined joint our the system change had to both consistent for way venture access calls. also customers contract with just

system, that revenue lower reported didn’t higher by the in results transportation from but volumes change our terminal this on reminder, reduction a related transfer offset As new distribution fee. terminaling

lower Saddlehorn XXX,XXX per of the ventures. averaged joint approximately in XXXX this longer to under see from the is rate quarter. on than XXXX much as day that move impacts XXX,XXX function those volumes shipments, barrels to of decreased approximately BridgeTex Longhorn again our oil low haul barrels on sometimes from at also segment greater by rates in means result they XXXX quarter HD approximately we quarter day average Permian uncommitted XXX,XXX quarters, which between our XXX,XXX periods results than Houston somewhat volumes also a volumes revenues. Although, reported keep declined volatility our Saddlehorn approximately in Crude actual significantly differential. volumes for compared and were that day and a were driven day lower their volume per currently in two BridgeTex declined our in impacts mind which a a fourth shipments, fourth contributions to

lower On due early a However, XXXX. from first Saddlehorn driver comp noticed corporate as may our contributions the program payments higher retirement incentive was quarter with of the primarily that an fourth sale associated quarter level, increased have interest well That in in largest you to severance was accruals. expense XX% of as the G&A XXXX.

XXXX year G&A commodity the of full XX% year, down overall the prices the year was lower comp for of For to incentive primarily and due pandemic about our as on a full result expense impact the results.

and just have comments few sheet on liquidity. brief allocation I balance Now capital a metrics

million and debt conditions number units XXX,XXX while metrics, and consistently average legal XXXX. units the repurchased with fourth of average maturity isn't a drawings and First, any buybacks current available, distribution the with return unit at repurchases see volume on our requirement cash paper debt of including viable repurchases of end XXXX, price rate nearly borrowings and $XX to $XXX year and at we We next $X commercial equity. the million. quarter our well a in cost capital about X.X year until share spending bond including weighted This total years. total results during of maturity with XX XXXX of total million a excess interest This spending, market both on repurchased unitholders of at million. our of at trading long-term had brings clearly the price we At on billion noted face $XX as facility $X hand environment capital timing, credit billion in past end of depend outstanding to sheet expected X.X%. regulatory life expansion number was cash $X.X our as of that our no the in I'll we factors; use a on capital portfolio have outstanding balance note our about bond of the no as of ultimately in value will the and billion of nearly as

Our ratio out of point of basis. strong I however X.X as trailing times. times remains of will at that on the below course end purposes compliance leverage leverage X a our well calculated of long-stated four-quarter is our for ratio limit XXXX

of replaced last of which impacted the quarters were first pandemic. by quarters of calculation out been and pre-pandemic have stronger quarters the trailing quarter was have four as by really the XXXX So that rolling been

published off leverage coming we'll Our leverage economy has results EBITDA roll ratio lower those our to ratio recovers we With XXXX in few increasing our continue analysis up quarters the discuss as themselves highlights again. in as to I'll and this until to result Mike EBITDA the for down crept over call morning. a guidance and do so back well that corporate back of turn the as conversion

Mike Mears

Jeff. Thanks

through Turning DCF outlook to New a is some light expecting. walk shed key number the with XXXX. we as the We you announced and the projections on where our for starting in may And was than guidance to for of this have bit usual billion Street XXXX may lower Products assumptions, be key the used build segment. This our we differences it assumptions morning I'll Refined our Year. recognized $X.XX the

compared by our distillate partial lost results. the increase and volumes material into higher to XXXX Driven assumes continued contribution well pipelines Refined XXXX be state recent XX% the up. this economic expansion put aviation were nation to become volume the demand during the higher Products additional expect we and to Refined and vaccines Texas. XX% rebound higher shipments X% clear during include to a available XXXX. Product projects of to the from as Factoring these first of in fuel with gasoline, benefit XXXX growth demand. all that XX% demand projections our as will guidance To Our travel recovery ramp-up new increase We pandemic, more year of that readily expect service in further of drilling in a volume especially from during activity associated as continues as continue and the about from within open half

by increase to also lower We XXXX projects overall compare might about our volumes our against forecast expansion offset X% we Texas results, be improved levels it our helpful well. from partially to demand. Compared XXXX by expect demand as shipments aviation fuel driven refined thought to continued pre-COVID product

is annual assumptions we an average every in in on our estimate around basis. about Refined sensitivity that difference revenue transportation For volumes X% total million ballpark $XX Products on

Products In addition the to tariff rate volume an our segment. to important is average model for this pipeline Refined component system

for used the now X.XX%. finalized that are plus to next July the X, FERC methodology You in index index based The FERC the the is change has producer price aware new on XXXX. five probably be index beginning years new

preliminary PPI negative X.X% which follow the for may know of change an rate negative that index a adjustment of markets you results the XXXX As in is our the for index. in XX% X.X%

deemed projects the year relatively each believe rate these our by overall and raise what actual remain XX% our barrel to Products these approach. X% refined competitive because in tariffs remaining of lower barrel movements. We mid or cost markets Refined overall markets generally the are the competitive the shorter competitive adding rates our subject are therefore around average to an projected adjust flat our XXXX mile between is due We similar closer is This in in per our to intend to of few not volumes increase expect we FERC incremental to movements methodology. be nature though haul of However our either to as to average by than we and to markets periods. expansion X% historical intrastate per are a the rates in mid-XXXX forces the rates Even increases X% to allow. to are index

also For profits. important the our Products is blending commodity Refined segment gas our it impacts environment directly price liquids as

this costs XXXX a low. be volume XX all historical which mid-January the XX% almost of both margin blending hedged higher total point RIN also of been have of a pressure $X.XX margins. hedges expect would for spring our on blending strong margin Butane curve at and these and prices per been volume. expected of gallon Considering equates roughly forward put have have average which currently to We sales trending late of unhedged blending for we our an which our blending

is X-year For $X.XX during which XXXX margins per average. comparison with averaged the gallon blending consistent

a difference I'd and margins to between COVID. like However was there point before after notable out

put $X.XX Specifically now. XXXX seeing in Based fall late our spring XXXX whereas hedges on per in levels to margins gallon. the are closer was closer to XXXX, were place pricing we

our crude to segment. Moving oil

expect volumes XXXX. to per the We XXX,XXX we per on XXX,XXX average Longhorn averaged day barrels barrels day our pipeline in versus

As approximately a of but portion an of for expired we have the capacity fall, last the contracts remaining of mentioned six life with average Longhorn still XX% Jeff pipe commitments years.

fill our marketing product has in as Although on our allow. whenever pipes parties some spaces we conditions been third move prefer stepping to market affiliate possible to of that

And marketing As year XXX,XXX quarter Longhorn Jeff the fourth forward, to we again, the closely in pipes, lower which activities Houston a expect in to contract moved Concerning these we described day the on so the first shipments during our impact. Permian day XXXX per already result with barrels XXXX. around full average a representing is the joint venture barrels we expirations profitability to reflects going be financial and than lower BridgeTex of prevailing is XXXX, of as average expect differential as currently relatively results the saw low. tariff XXX,XXX

to anytime uneconomical the incentive quite no mentioned Permian expected even spot shipments customers between soon with making differential continues low As and with the Houston improvement be in rates price place. earlier, for

with has remaining BridgeTex reminder, of years the life a XX% average four capacity. commitments for approximately of As pipeline's an

was adding transport complete Saddlehorn, we per XXXX, end to at the XXX,XXX than about as move to per barrels capacity the day XXX,XXX higher expansion Saddlehorn of day per barrels day For barrels for is day. The expect of XXXX XXXX. pipeline XXX,XXX during in per which of new the expected XXX,XXX barrels

previous average six shippers volumes have the some credits capacity utilize for periods. three but shipped the years, in remaining in term with roughly full of bank's for to of life extra near We an commitments quarters expect

discussed an we've kicked to side, the off expense initiative a the efficiency the cost identify over in savings and past ago organization. Magellan opportunities year the On throughout

across process million We drag-reducing optimization, are have of with improvements in XXXX. business being already $XX in to-date XXXX spent and savings offered effort. significant power progress closer capital, identified reductions, agent These early late spend through our $XX during modest savings including the and Concerning through workforce made million XXXX. we including maintenance this nearly organization cost million to realized primarily to expect program $XXX guidance pipeline an retirement and XXXX

our more and considering issue item assets. both on approximately capital each our XXXX significant total to and in classification very And which ensure Although, we spend integrity of XXXX, and and reduction work shows a to is to expense, similar time expense. it's between line the of expect $XXX reliability Magellan capital million this maintenance spent effort between year in and periods, safety spend.

in and recall, you expense As cash flow. distributable determining maintenance are considered capital both

current our on XXXX. $X.XX provide coverage cash time, times to approximately Based Magellan indicated, resulting do of we excess the At at generate guidance during the maintain financial for beyond year distribution billion, this X.X million to $XXX quarterly previously in of expect not cash As to XXXX. this distribution DCF year. level our guidance of intends we intend

X.X investors do and the Products on increase margins the we Magellan targeting capital we combination focused repurchases long-term expect expansion least once DCF are few our a equity demand ramp of to as cash economy However, projects improve over historical years distribution as on realized. Refined investments. levels. disciplined times distributions, to still and continues remains the and next at of annual are to Further, blending coverage more Texas for through value delivering return fully

a to in to is for the look large-scale environment environment Although, the continue project we low-risk opportunities future, capital future. attractive for generally challenging to current foreseeable expect invest for and Magellan's capital lower we investments benefit

canceled, had we from to a expected potential increased of spent smaller actual we expansion being well some of million, projects on add expect projects be capital projects a coming our spend construction. as currently expansion the growth range now addition carryover we projects budget of throughout new and in of XXXX XXXX has slightly spending We XXXX in $XXX million capital combination on projects. under During likely XXXX will year. these that range and in the $XXX which projects million the as plan Previously, million. $XX projects, $XX due XXXX, additional Including to under we to spending are spending few

As EBITDA attractive generate our in meet are exceed returns eight quarter, but that smaller to opportunities very times mentioned current six scale, multiple thresholds. times or last

terminal expansion refined which approved For low-risk and transportation supply recently gas returning our Cheyenne, liquids butane activities, loading area of capabilities projects blending new including products improved are both high our example, opportunities. in truck for Houston Wyoming

energy type find in approach, we due to the Consistent disciplined We a remain and expect and make markets an transition decisions to service not locations. serve to terminals for demand in opportunities at projects regards provider at with With previous expanding more to our market we of these of Magellan typically all participant and needs EXX patterns in demand potential logistical meet invest our customers fuel projects access renewable bolt-on products the blending has of and a our of topics, we'll future address part markets. on capabilities to and in biodiesel our satisfy number changes in EXX to EXX, of speculative providing by for in based gasoline needs. handling been petroleum active investment ethanol

in ethanol, operate. associated states emerging low-carbon biodiesel, with that renewable of and standards We fuel mandates biofuel where fuel assessing in we the or are are the adoption markets potential additional and the expected renewable diesel the opportunities growth

As always, to disciplined approach. continue will we investment our maintain

structured time of publicly-traded is own And being time like questions, understand forming we that of conversations conversions for periodically investor understand the in and now briefly line long-term subject. could on every hit we impact shared we to we remaining the corporate to -- analyst topic of investors have that included as creation come and We to opinions corporation. approach partnership that we additional and C-Corp for I'd up from website our their best to on view alternative the value assess this and a attract Every assist help converting a the concluded continues investors. investor Before partnership our our interest. posted The have to potential conversion morning. we them corporation analysis have this for the analysis a open

equity value Assuming And stock and broader potential is of inclusion not magnitude uplift while any some any indices resulting in market the in potential the more price equity which In overcome burden is potential of known. sustainability increase to even value potential clear. the be not are sufficient material we cash is case, any believe long-term taxes the of over time. over future in quite the expected increase to but

in not have any guidance analysis. provided long-term We new this

we Magellan for conversion that these assumptions valuations assumptions modeling is will feedback. analysis. can tax now to our we continue a have manipulate for against we concludes basic issue is the on midstream Investors is up using for purposes priority potential to investor other can the illustrative this conclude purposes. we While on companies, monitor warranted time, forecast policy, their for line investor Based own remains That corporate not our simplistic developments material, the still relative and this prepared questions. Bottom-line used but long-term so and including at focused open and value. remarks

Operator

Thank our line first [Operator Instructions] JPMorgan. much. the Jeremy you from And go ahead. Tonet of comes Please question very

Jeremy Tonet

Hi good afternoon.

Mike Mears

Hi Jeremy.

Jeremy Tonet

of to XXXX. if able unpack more on over want kind pick be thanks was just a I to and the just guidance color bit recovery the Refined Product you cadence wondering of little course for providing the might the there. I up of

course a more weighted, Just the there. or the this Just want your sense to see progression is year year? kind back-end if of the linear see want baked kind of over you into to get of what's of if a assumptions

Mike Mears

the of it's of it pretty increase. don't -- in weighted is of year. me. it's mean those two. of progression combination and gradual certainly graph a is But a through course it's have the kind I chart I front of It actual a the Well, ratable back-end

normal by levels the by fairly then has and least it the quarter. up ramps gasoline And the the back to biggest third second first quarters for think far at distillate fourth in impact. I quickly closer to quarter get

Jeremy Tonet

And just and on maybe guidance there. about margin also assumptions turning difficult is blending to it? And now curious and make to how kind guess Thanks. that butane the that as you can I the helpful. move $X.XX the that's like view kind where they future? new you your disruption what paradigm the blending market baked in butane margins of or there think as are, Is blending could that looks you kind this of room a inherently in just seeing do RINs of you're right a into is it for for think be guidance. That's and it around it. Got with short-term But recovery in the

Mike Mears

and think not really that anything likely widen really the in versus back prices. the spring to the And again it's would numbers the margins other I the increase once been dramatically would of fourth one been going will We Well, more averages. kind has than world starts RIN to butane in which a gasoline of element strength the towards that prices quarter in in has that. gasoline demand prices gravitate change these market What's into long-term hurt the expect relative see up. post-pandemic don't that catch the then

some pressure back to efforts capture amount a them into RIN gasoline think blended underway prices demand even the to on again, widen argue that on should value. as demand put for margin number that already There's RIN being of could to may some some future I renewables gasoline the RIN one Now, rationalizations will again of lower But stay gasoline down. further of prices some that fuel time. increase with for and expectations grows, elevated that to refinery see you've that bring started of also

and over pricing renewable related our I things think is stream. more in two fuels fuel emergence that increased blended the is the are demand, the pandemic of to RIN to as So, the view reduction -- which it's it's gasoline moderate also into will this time related and

Jeremy Tonet

That's Got it. helpful. there. I’ll Thanks. stop

Operator

Gershuni, Our ahead. is next go question Please UBS. from Shneur

Shneur Gershuni

needed how return those capitalize natural of Good there refinery as was can to call projects. conference always spend will last or you we just can opportunities instances? expect take about at well that adding systems the will sort talking the morning pivot capital I And discussion upwards in it talked of obviously the you growth about, potential shutdowns that around, good operating if of be you Should see spend that could rather wondering, that for your without And create or to leverage you that were existing afternoon, you to everyone. about will described, some is Hi. in too? opportunities. on capital the to a involve that advantage some progression to having profile so allow we within you

Mike Mears

Well, are not XXX% amount there's our many I'd mean, start system. general by operating into in a saying significant our leverage of capacity in I pipes at operating many, markets. that,

which so It's set if how capital, reduce to very any And to it's much refineries there's to operating because impossible capacity leverage specific say there. have though, we spend or out.

terminal, can modest the pipeline the but the but trucks capacity capital So truck Cheyenne in the for rack, the we so that's get left across expand accommodate instance of market. our some simply investments to that's making capacity gap in with the we're refinery can closure, more

question. – it's it's hard really so And answer your to

of we are what because, know, quickly refineries planning expand. so we for we inside what to don't spend system that be embedded in in work a at that. that many very, and of our kind of time think or of would capacity to if I we but know when yet, lot modest. But you can mean, on we'll they're reduce knowledge again, We're lot for the would don't need if we of modeling our I react capital ends invest, know, system to a the then refineries the have pretty don't haven't are we cases very capital done amount as planning any happens. or planning that

Shneur Gershuni

that. if now see versus right the XXXX projects. us provide I in to of year, then But remarks. sort but you your quickly point it's that versus apples-to-apples And say how prepared guidance your you're And to through on Thank I sort makes just wondering at growth maybe year the basis perfect sense. you XXXX this can you provide first back quarter went an for tracking was forecast. can for early excluding And pivoting of expectations of sort to you you volumetrically, this if – if the can where also you know, us

thinking of about kind you're how Just curious, that.

Mike Mears

your that at since pleased answer year-to-date But is consistent to is our the the first in with Refined is Well, question Product not expectations, we're guidance we're the we're serve. demand and here with what trajectory the in markets of end seeing January. we surprising which giving the January

that On I have of the part don't handy. second your question,

me and But – overall. I I think X% number the maybe front is have Jeff in does. on don't of the breakdown

Jeff Holman

we Yeah. of growth bit the is expanded is the them. to a pretty have because the years. contracts that those tried as good assets projects have little analysis been being that I reasons No. for projects came majority were explain The that nature of on with were of don't number complicate, handy behind our Texas Well, one allocation because a

pandemic the as to Some those the committed was happened those up. of what But and started business things of so and it drop projects just and some – the existing with saw wasn't. ramp was drilling in you

And growth. saw people started shifting volume some meeting some you from and their commitments to base

expect looks overall strong. skewed projects that look And otherwise where answer of we on would if weaker our growth our business get really would look than it to what's a way, base what you at kind really we So, happened demand. based

that. think reveals. than just It's So it's of more when becomes a kind – I we obscures exercise bucketing it do

not that the ramping the demand look. short-term separate up. know anticipate the that expect back and And has fully Obviously, Those we those war. stopped are middle of implications on starting reason price multiple of see starting the in so sort or we've projects did pandemic projects. for that clearly to that's providing We a why

so it's kind there. serve And base we those the that now, be that in will expect find a we demand productive. did excise But projects we originally eventually right to growth of bucket don't and

Shneur Gershuni

No, I slip last can one appreciate Maybe, the if in. one difficulty there. I

year fair to sizable more directed be your that growth flow authorization buybacks, the Given or cash on capacity or will free any now? after side is are buyback cash this excess to the pivoting we it towards assume remaining distributions

Mike Mears

right the the of at year, think flow. It's our distributions capital and spending. spending a units point they're or our look expansion free that to to for above cash we is that the in at to cash our It's capital timing Well, time $XXX is the I distributions think to million above of be be have very you projecting above going But going a not forecast $XXX attractive projecting issue. also say valuation on for the free considered it's think now. We that attractive that if issue cash price we equity going flow be whether we're buybacks. flow we're free and fair million

So, it's fairly well balanced.

in XXXX have buy the of that to in to outperform equity. this then some excess did further We're to So to increase planning that point equity. our guidance we'll just cash at we leverage XXXX. to extent We perhaps pay not back

we As don't it stands right now, that in plan do XXXX. to

of Of course, new have all as we where right goes stand but that information year the subject as is now. we on, that's change to

Shneur Gershuni

much. very color the today. appreciate Really you perfect. Thank right, All

Mike Mears

you. Thank

Operator

And our go Please next with Tristan Truist. is ahead. question Richardson from

Tristan Richardson

Hey, the crude guys. on side. Appreciate all afternoon. comments Good the

one expire affiliate as Can talk customer quick to one contracted ex start contracted to the level? that Just volumes you you to about you credits and/or such at see relates be when it Saddlehorn, and expect XX%. reach being exhausted on them that

Jeff Holman

credit. huge there. second -- very numbers half of year. number. on the of that not front not There's this don't really We not half that But of I big a year. first should those in It's ramped the right be of fully be a in bit driver. a the complete the have me the little going It's should on by up very

Tristan Richardson

going Jeff. to should looking terms rig production what on curious count for kind of guys in either And of of we just or side, back around have be thanks then, the out? recovery kind hit question that the to laid assumptions Helpful, distillate the you

Jeff Holman

don't Morgan little west. a And I candid, have going the discovery moving rig Well, that, be are there's totally bit Kinder moving We're still barrels of moving Mexico. were on to we Albuquerque barrels to count. into because a and specific barrels

and are It's as rig that you those So, goes really but working of out other up, to up it's demand system. draw part rig as a the you best well volumes there very count is count go big it, in not for our up long-haul that activity just as directionally West. our The volumes see up goes can will barrels. we're things matters tell I on

for Demand typically really of Dallas I is market. they're best because you. us also tell that's So to in attractive sort expansion very picture barrels And move. that can in Dallas ECs part of earned the

of a number different there's So, factors.

Tristan Richardson

Thank enough. much. Fair guys. Appreciate you, very

Operator

Spiro Credit ahead. Suisse. from is Please question Dounis, next go Our

Spiro Dounis

back last I'm of a Mike, struggling to being products a to guidance, I'd I inputs those bit everybody. and down. guess refined big is would ton have But expansion market, EBITDA to like on offset quickly we still been year-over-year year recovering go butane. make guidance million could. that's just what with afternoon, not enough guess $XXX like all in picture Longhorn I it But And isolation. if spent on sense Good the should right. seem

year. margin are on the and just curious, a bit the a in more you what I'm just elaborate basis big on of So gross takes puts maybe -- some

Mike Mears

Well, give me a moment.

were profits, XXXX that's a And just a our in me of let combination think think and buckets. where the crude It's you year-over-year, $XX crude in kind million XXXX profits maybe less volume at and first tell the the And I things is can transportation blending skewed versus just If profits rate. little we then very strong. that for have hit blending I I high-level quarter model. look year-over-year. transportation we about some XXXX. what of blending in

XXXX full forecast And so, the there. almost year $XX if decline for we versus million of compare XXXX our a that's

two to decline are. other recovery, that Offsetting year-over-year biggest two in back here. us buckets. smaller those is mostly $XXX we some the is bringing are those earnings Those where in the between items. which things Refined There's between Product So is million

I think the of in for storage contango market instance, in we the because second we that the in. locked increased had the half of revenue year

XXXX. that's the in half not year of For second the repeating

in So buckets. are those there's the a of biggest But there. handful things

Spiro Dounis

really actually helpful. That's Okay.

us, that helping for for Mike. bridge thanks So

recently and Second the other question expect on you and any longer market Enterprise areas like do you Can how about system if you to this into to announced Houston. contract for term? And decision work with you plans delivery together to EPD impact volumes talk to that develop now? there's physical futures this? the And a

Mike Mears

deal it and what of with area. for just of that each Enterprise confusing. initiated market Well years as different the a on there's market the our delivering and we traction. Enterprise mechanism a you futures become together we oil programs of try hasn't friction gained offering And crude pricing well or a adopted. exchanges couple we've ago frankly another, terminal build reasons how know is we and on from believe quite couple traction. there's that pricing And customer lot discovery hasn't to a market And transfer The that to product pricing the the of Houston is to a one confusion great facility a Houston both, and heard on from tariffs. the can But really -- frankly, has a futures in quite how price to what's other, it market carried work at the

that contract another market. discussions that how work of the and market impediment one had of around to being maybe At together transparency -- the that the with was the solution, the taken is was would in a We in but why that's lot the program. that lack same make time, of we so looking the really effort with reasons at And Enterprise hasn't as biggest developed was we had happen. of think this And and interest a sponsors AGS the big off. been there clarity

I if apparent wanted together. became make we something it in work believe to is Houston to to that us work the really and Enterprise we area had So also

we've done. what that's So

We are going to agree on mutual delivery points.

to agree facilities. to access going We the are on

Both to to at involved There's no agree rates really that of on area. do this. the all those to got going complex We're that connected that. of the delivery. systems. our scenes, We our export We're it value that to there's got the systems in physical has the trade market. for easy to terminals in transfer all working us facilities least put on capital the of to refining to the work futures and interested still place. customers working really for We've going two people of this into pipeline on do in great the behind details think make contract between are are identifiable exchange the between with lot storage. We've an piping. the that the a to for respective Houston We market think in to things We the

keep choice. value which and in comprehensive utilization increase the the we've value the time offering. a And long-term of make think will and Houston in the the the just we real got storage storage we liquidity, here think value So is we Houston a of of The destination increased market to think also in full the you way market they expect contract to a liquid have want we a Permian customers works to it as the Cushing. futures see as if to respective go we to it from can which work to get what pipelines, similar Houston where is our to as

Spiro Dounis

for Thanks Mike. the color.

Mike Mears

Thanks.

Operator

with from ahead. Moreen go And question next Gabe Mizuho. Please is our

Gabe Moreen

afternoon. Good

potential. then maybe guess allowance I the tax analysis? considered or the not not Just one. on what corporate income here maybe that's think And FERC related in To follow-on quick the I me with two-pronged related. issued extent a the conversion as question of was or from sort considered

in Just and either following the your thoughts case future? rate the XXXX latest returns at sometime on pipelines your regulated in

Jeff Holman

understand part? I didn’t the second

Mike Mears

repeat question? Could the second the you of part

Gabe Moreen

Sure.

a pipeline the Just latest thoughts on pipelines? filing case -- regulated on the rate on

Mike Mears

our partnership looking and what's our I C-Corp. is mean we we of the into This it. got Okay. what's in liability, tax consideration the didn't just clearly policy commission. I really at convert liability Well if tax the was today a tax analysis, our to take income

tax order entire applies increase capture that, of to of which XX% is cost subset in that to business. that only we the point nuance impact clearly of liability that Then is rates Now markets, there. assets. a out -- there's C-Corp also cost our again on and would to our regulated filing, potential tax that liability. convert a service cost our just regulated that factor which I'd was it if of though our Obviously, there a of a presumably

that rate On your if it'd successful the in opportunity, because projected answer, to should be think we shouldn't question, I second what into our there company, whether We it tariffs. equation. regard a file recover it get or of liability. presumably or of There's haven't decisions the is in small. benefit case, context to to that. say a in don't recover of tariffs small -- that we not that any to say a think opportunity our be some that is entire that, on change might there total small we've we I So portion factor partial to the didn't intend the tax I I increase were would tax lower made small a our

you over XXXs -- will reflects on at it. demands are current the per our especially index not you we believe pipeline is in future going cost evaluating if mile that burn And to total time. increases products that slowly are We our be, view look what our it -- our decline to system. if We earning of are refined historical we're we in that representative believe page under do going

but it But we we're between something earn that's should do, able our the are recover is And to you we ourselves preparing for. we're gap costs, And I it. could be service or filing. we can to earn can now. that evaluating. with tell not what and cost And proceed to we've made earning best it's the evaluate I think we'll something that It's decision if of what that say so something the that also a we

service haven't of we our of Williams. We cost XX predecessor a years been when in for back over were rate part

and experience the actually is of case our dated. cost executing rate service details so, And on pretty of knowledge

aggressively ourselves decide of in getting we speed to to prepared do So internally we and through that. process are case up the going

Gabe Moreen

Thanks, Mike. Understood.

Operator

Satish Praneeth is question from next with ahead. Wells Please Fargo. go Our

Praneeth Satish

of afternoon. some We're guess new slow of and seeing vaccine. COVID Good I a rollout Thanks. strains relatively

a any approach you XXXX does how variables? of level, high wondering for I'm So just it include in from the there guidance? these And kind this just cushion

Mike Mears

within other know rely third-party are. analysis. we're and did. than getting crystal developed our on precise I what future into when a mean, heavily product on guidance, the we our we at our mean we Well look actually But our more trends I what little have Certainly, We we probably ball than much guidance refined our also you're people market what better know -- we a seeing we areas. when do. don't

guess. We big have handful those do think kind projections. a product government we refine into of demand name demand projections. it We take consultants and of is best who product all know of the We take statistics what consultants who refined on things homogenize

-- on based extent mean, the vaccine new and momentum. keep be look picking there's to models gaining think the third-party it in vaccine our at Hopefully, is is we and going steam. yes. the these but no. that I So early variants And didn't rollout at slowness a But then, your some trends progressing trends based will material to those were of to short, the change factors looked still the built I up and too answer into rollout. we tell. of say, on the we Because it's in think

specifically haven't put in those We variables there.

Jeff Holman

the much add, I'd very problem situation. -- in we Yeah. just were

That's the I could present look basis. other. that people to continue or points why could point about $XX demand rule to you think thumb, it's million try annualized your to want different we way extrapolate we tell one of all to data an assumption you make of if on

our it, but have Cushing, of into you you forecast. think built per little not we you if bit So need a can se Cushings build

Mike Mears

all that other there likely we airplane. people to demand once late personally wants and desire pop a I mean, travel. pent-up a demand in pent-up spring drive the to think pent-up lot flying I than we to haven't based that is or for or pent-up that I it's that I get and demand. that. a get stability, on forecast car that the whether are an of level that's there's projecting rather thing to side, perceived of there's going mean, this probably happen into summer think out a number on built positive is But our just of people a

that into of any built haven't We our models either.

Praneeth Satish

at the of helpful. energy do get the and sheets But high-level balance guess you a next leverage over the based run better few ratio just And one chipping your decades, I in very is But space. current lower comfortable in it scenario sense leverage, or mix? an we're away the is Okay. this transition as where keep rate on business even occurs you makes where think with it to are to question. you obviously look then a That's if leverage, the

Jeff Holman

any the I We Well, due we a now flexibility say. right to got develop. what luxury We've of would watch until I have think things XXXX. have not debt lot do is

are typically going the you're talking they're think almost things overnight. not of kinds generational that to I about happen

on But path we're to So not -- we've currently got time to a on not we're lower leverage. address.

where less of more like It's decided with we've We you're for talked we'll firm. a have not consistent that at. to our continue long, course. some we're the watch that what to long time. We about things as intended and But manage discussing start get or

Praneeth Satish

Got Thanks. it.

Operator

Our go next Lapides, question from Sachs. is Please Goldman ahead. Michael

Michael Lapides

but trajectory post CEO roll whole four Permian And -- not or capacity for where earnings made comment included. XX much industry you long-term, Hey, I for know thinking. the that a just the you does three last of, far a years big what of is oil of, everyone the a think the supply past out guys. years, to I all long of Thank years. about as the not a plays maybe this in question. do to the of excess out what to out, kind we're month pretty probably about if think pretty for year to was how producers scenario like my couple a five contracts massive prominent you also the you for that I one or conference CEO taking next at three, kind four takeaway have that but do Permian pipe. if all going pipeline specifically, eight How the,

Mike Mears

to physical mean, advancing desirable barrels There's it trying the one the Houston, a very make for the contract that water. a thing do thing lot to prepare futures say by first to liquid access if location think we're I I with that question. to most I'd for is happens is to

will I the done. doing. one likely is thing if the think their get market contracts we're that's participants start so of capacity. conversions So we services. that. on it need we think all where tell evaluating will kind you get are that I about to I pipes into there making with But do pipes, any decisions promise to low, into that our can of I that also be margins if that other it's scenario if have can't environment the you the you think are near nowhere gone excess in

per with be take to the then incentive tariffs extremely conversions going for market. to So of a huge out and economic everyone's capacity look fighting there's barrel people for low

their we through which a now, of as is, normal So there's cycle, closer to think contracts into the right? I variables now. you be knows prices looking today. that for mean, -- crude those like. look I'm we closer might contracts I there. mean drilling prediction. have what can't five -- get it the oil mean not related get so our are a market think have it's lot saying first you he or that go contracts we plan if of anyone you very think for out to don't the what that what ifs things there's since I'm a people as that plan then years is really I I picking will I many once now making again if six wouldn't get back could But I up. other and pipelines we And But just end high from as at.

Michael Lapides

another refined of the Right. to question then sense. products No, makes that And biz. pipeline side shifting the

hike? to obviously, just XXXX, all how of X% you year? that just to willing that X% negotiated kind to in, are the your indexation rate a through about your talked the customers have rates And given responded on the have time normally like they gone You the customers absorb same X% try a get price X% to XX% that increase around this curious to in kick pain you,

Mike Mears

Well, asking it this about we done if haven't you're year, yet.

But we than markets. certain our discussions history So an we when And more have years is. we going back a cost had to really over it. raised with shippers. we with we But not we've in to structure got have good our index try customers, actual And like our that our It's argue our those in in it discussions raise focus on haven't rates we when rates. competitive easier what for discussion. I'm they have our markets basis

Michael Lapides

of, Got back to I increase you the to kind last XXXX really and a oil X% X% then to now? think to compare maybe just able we're the frame XXXX, it, thinking it about watching all back okay. big XXXX, try just time downturn, to was and were going what and through pass-through

Mike Mears

Well, markets. been a And exactly what that a deviation there's during back But and I our caused disruption. of that's competitive between a where time. can't the number there recall have been little index times did we

Operator

America. And question Please of Derek go from Walker, our Bank next is ahead.

Derek Walker

types canceled. I some there? remarks, were your everyone. want in projects I were of mentioned Mike, projects canceled? just see some dynamics good to what the there think you discuss Hi, are just that formal of Can And afternoon smaller you

Mike Mears

investments necessary of terminals in may well, don't really need and not is years. and projects would into be kind to Well, we're growth now were I of based be that number incremental we mean environment we've for It on there that for continued we It volume mean in were isn't example, tanks that markets now. the of looking some canceled those right longer-dated, the in I building I certain so a mean, volumes expect make now. those terminals. some think necessary kinds dealt either accommodate for so, expectations were at to you they we southeast in. would right

it's those things. so And kinds of

Derek Walker

it. just Got follow-up. a maybe then quick And

or be helped opportunities energy those mentioned I today the what's CapEx those of far And as biodiesel what see projects? do return for of type you beyond profile renewable set? expect the opportunity guess, doing you diesel As lending as what largest you that's might transition you one do

Mike Mears

that we there's a blending for because at for for transportation. don't increasing level markets, blend can of transport stage. have instituting are Well, for blend certain market a our pipeline Those the our market and certainly considering us, in it of biodiesel transport particularly mandates their infrastructure Missouri, there at all a biodiesel of pipe. into is diesel blending that. comfort And by can the ethanol infrastructure mandates. actually where if blending this into for Minnesota, terminals, diesel more we carbon or bit and the We either in states terminals level We our but today biodiesel investing development it ship renewable diesel There's quite opportunities create for standards pipe. no by like, or for reached market and -- Colorado, that blended But either pipe. a ethanol legislation probably in potential we by areas, in gasoline Iowa and and enact of be a may could fuel in feel biodiesel low we've little

opportunities for some at looking that we're also. So

Derek Walker

Appreciate guys. time. me from it That’s helpful. the That’s

Mike Mears

Thanks.

Operator

from question is Capital next our Please go ahead. And U.S. James Advisors. Carreker,

James Carreker

Hi, thanks.

of the demand, refined Just going any increases about any that on could a about your of several I back question but system, back more years. kind to of you put high-level DCF How next just demand, normal talked know get we over thoughts product -- kind to views volume much thoughts? if you XXXX of tough it's level

Mike Mears

one capacity, projections is of volumes? of what one are question it increased your for Is or our

James Carreker

sense a normal be for of much that X%, theoretically more just very -- I sense in just XXXX? Not how was it relative you've necessarily volume to demand, below of there would Is terms XX%? get if XXXX? room income get of scenario a capacity is run what but to that back terms And in XXX%, pipelines of for much did how XXXX that trying in that we your the in then in XXXX like out guess. would how laid I'm ROE much that? be XX%, to beyond

Jeff Holman

into our of be answer projects were volumes were maybe that way we to XX% -- with we growth in over one came I would an increase question XXXX. XXXX, thoughts way answer maybe expecting when One believe initial question that to

So to now all-in, we're XXXX. expect we X% telling you XXXX be over

full would got we understating include that our gross And levels. we probably at if that's there's So a growth it expected. And you can things number. XX% to additional on least doesn't imagine probably because any projects X% we back higher ramp have little that bit gave

So X% is probably a floor.

James Carreker

Okay. That's to just very ask BridgeTex. about helpful. And wanted maybe then, I

about throughput. a the I I XX% think, XXX,XXX you of but expecting guys capacity day you're barrels contracted, think -- talked is

I think number. that there? the the fairly I Am math number significantly lower doing is XX% right than

Mike Mears

Yes.

James Carreker

that's there? on Any Are receiving going be any still about maybe color to how color on what's payments, going you or going work. to deficiency

Mike Mears

little it's complicated. Well a

low, an We is gets low. have agreement. even basis pipeline. that associated works they particularly And margin the with it. of contract the off contract derivative gets affiliate differential an shift -- it anything the if where particularly point There's a there's way we of And reaches when a the make don't

it's increase just did not income. shipped. And they If we've wouldn't our it ship that so assumed

that's way differential income look It increase basis our at it. So think the current to the would environment. in I

James Carreker

Okay.

as deficiencies just is not related the basis. much it it's really as So to

Mike Mears

Yes. Right.

James Carreker

a that could blending half allowances margins to then some nature. little back I more you in maybe we pipeline if And What get $X.XX about think do if can I And the of talk an through one extra about and I you butane then sensitivity apologize. bit that fit I speaking, and also of could broadly loss talked to year. think the things flow? commodity you've do sensitivity have But cash

on on? color commodity So any based deck guidance what was your

Jeff Holman

on question the Maybe you gallon… asked I'm think say tell you if cheap I XX. Well, and about a first not $X.XX I could

James Carreker

Okay.

Jeff Holman

following portion issue. fixed years million a an upside. this year about more $XX hedged. – this it we see because already of year of already this be of significant say course And And the We is

James Carreker

Got you.

Jeff Holman

we're that I Especially handy. that's had what think And about I you commodities that the number And then using. asked just...

Mike Mears

I be don't the there and an was shorts. I think was would have improvement If what question our that over if in impact price. we on his number. know

Jeff Holman

have I handy. don't that

Mike Mears

that Yes. have We number don't handy.

Jeff Holman

the you the both Well of number I and is lending. $X.XX it's tenders quoted inclusive actually $X.XX the and

James Carreker

Okay.

think oil was in like a $XX price about crude maybe year DCF. had talked of you I last million $XX

I was had running if that – just if similar if held? wondering so maybe relationship still crude we a And had we a

Mike Mears

when don't new I doesn't. we this But maybe of kind point it RIN And relationship right correlation not if right elevated use – you. happening just wouldn't really more now prices a time. back a that is at well. elevated in it correlation as But normal prices will. not it's the butane we the you for to now, That – apply at environment doesn't perfect. and it's with look Right what's now correlation And have It's that experience-driven. get

James Carreker

Understand. for Okay. color. Thanks the

Operator

Cusimano next Please go Heikkinen Our question Michael with Energy from is Advisors. ahead.

Michael Cusimano

all afternoon. good provided. you’ve Hey, details for Thanks the

Going butane it more have Can that does back little enhanced a access, announced to talk expansion for butane And is connectivity bit business? blending. the or previously? like all expanding more you that direct your about margin

Mike Mears

to it. margin the truck able simple. than we're be facility into pretty the expansion all It's because It's to butane pipe direct going rather

Michael Cusimano

any any Got the the – Yes. exports Okay. you that growth from you. And then butane is margins pressure we've continued do all see also on there floor seen? in LPG

Mike Mears

what butane now I price has that strengthened relative certainly the to demand of Well seeing the gasoline. think export is that's right we're

to compressed one the And seeing we're right contributors of so the margin that's now.

Michael Cusimano

Okay.

you the over is it up butane in margins? the more mean the year see guess affecting price than I So I do last coming those that, gasoline weakness

Mike Mears

margins. is affecting It the

Jeff Holman

Certainly through recently.

Mike Mears

Yes.

Jeff Holman

say we Over been has side. in hasn't margins case are the say not looked went I'd sure, been that last if the the and sure Not there more butane but in I'm recently was the year the that dramatic move back at doing April. case what

Michael Cusimano

Thank you. all Got had. That’s I right. it All

Mike Mears

Thanks.

Operator

Murchie Our go Energy next ahead. Income is from question Please Partners. Jim

Jim Murchie

to years. Thanks. to is of into looks lot $X.X a Murchie Louis to out back tried It the guys. Jim all Lazzara corporate I of go present the number. billion your EIP. value It's and wanted Hey, like in at analysis conversion we that kind

you in over like $XXX a a And if and million. ramp kind have. market present XX years cap. points consistent It's data like – only of The few the liability first X% XXXX. $X the graph depreciation of up between the just value you tax you now of those share. You the of gave kind ramp with us years is

out $X.X when the XX than something now? looks like XX% question. the through terminal So is billion, model years it more $X.X of of It's first billion That's value we to XXXX, from happening like the the get like to is this the tax $X billion.

is, is regulatory shareholder and corporation shareholder on down -- the the side this an side. too, was tax pays, that. question the second just an the there's a The Gabe's for didn't question on what But goes you offset offset maybe as rate account

stock at savings that Because shareholder discount same rate you X% the in looks it's had? shareholders, future $X I'm the of using back the or is that. Just showed again really least many And have value that present of years billion tax owned two-thirds value like how your -- envelope the look the onto it five the your company incremental years the way of shareholders sure mean, the present of the alone the guys and less. shareholders graph for for that both kind I matters. have captures these not at that.

much in limited want And sure anyway beyond the is of savings the of A, B, XXXX. by of character that partners? sort value. understand not just the that -- we present make decremented it that, I the how to is the So to

Jeff Holman

Yeah.

back overstating, the I -- you're So, the although, in but how think its correct. obviously. the haven't number, XXXX, first you're directionally -- directionally I of you're XX-year backend I much think calculated in

Jim Murchie

XXXX, discounted using in $XXX I million in from of kind XXXX, numbers. mean, Yeah. I'm million. smooth percent, $XX your, -- the using I'm assuming $XXX million your I'm a just its progression in

Jeff Holman

piece about look, you But the a of question long-term is think overstated maybe clearly, that. I it. XX it no

because If we pay for taxes, question their a on it's group the basis law happen, we're what we brief around individual idiosyncratic -- in it of group. each they It depends after-tax we on holders the little for As when just paying run in on person unit sort what an in. very which -- changes question trade have answer basis. of what holder, don't plans happened when on sell, depends they're the trade taxes and when appendix we well if depends gave color. did the on a unit It And selling. it's bit

older recent groups a likely actually less the by conversion, are So more trade would -- be to trade our benefit groups, the map. from in

Jim Murchie

all years effectively going question, have No, you're when right? over, XXXX, to of effectively but those out turned

Jeff Holman

to mean, person. Again, periods. XXX% all those again holding I depends idiosyncratic are on questions that

on a in trade ex. case, It is that, answer one So group's long I this there hold. the how depends answer is

And you hold longer partnership hold, favorable the you so if more the -- is. the

Mike Mears

just See it. that get into and if your in discuss we detail. Jim, on schedule But, we the And call. it you, a you can lot, details with we a can I separate, that's a maybe okay might because call just through more to suggest this schedule go liking with

Jim Murchie

Sure. you something have did Louis, else?

Louis Lazzara

Yeah.

look here, S&P forward valuation the you Just right? six, is comp of And if XX.X on PE at the used. a metric, when you DCF, guys XX.X%. around XXX companies, is more slide commonly as ratio you at looked P/E times, at C-Corp guys much majority there's not whereas average Magellan that vast the do presented is use

when to at on of in this that's DCF. arrive here, So XX% guys just came sort gap, And Bloomberg did consider difference, a you analysis? decision estimates. consensus only that you or Did valuation your you

Jeff Holman

details. the on focus We No.

and super think at over ways, that try something the as good. that but And of at kinds DCF companies. it take the to put looked look We line. that's not the this we don't gap clearly on we valuation we way valuation, -- while we about we're as didn't -- is calm in And there this for look midstream Although, pretty some here actually And simply in years. we think perceive. people point think we pretty that all your have is pretty we -- on might

some struggle, we missing. there's So, see was I that there obviously arbitrage need that to

Jim Murchie

there reason something business would guys? be that on companies, other -- I'm those But is a -- some those traded right? relative Is in P/E clearly volumes grades, to to other of the the discount relative your are P/E there you terms and of basis depressed like in a midstream your guys why concrete a missing

Jeff Holman

I this I'm of of with that investors our into lot -- bring because prepared ever up a think either. don't to P/E go frankly on don't we P/E, and none

about maybe hard it's to us think for So, this it, suddenly in terms.

Louis Lazzara

are you, to the and that people and would valuation, stability getting people the K-X. The possibly that's and buy and people can't on who and own because you XXXX, talking that investors and that you the the That's you. funds can kind buy you're the is own change right? PE the that liquidated every issue. things of so buy day you, the that growth issue that through only The change are that earnings way your issue, are valuation. new as sell the change rates a Well, can't already It's you you priced people they hold stock a can't they issue long KX

that's So why make we point. that

-- the XXX, metric. world the is into DCF the get You S&P of it's not

Mike Mears

time, conversation just think, we for better this be essence this to us it And have I want Just have the would in of to conversation. one-on-one.

push detail, in you. think this schedule we if let's can okay a trying So not more I talk that's call, that I'm so we to on up. just and about need to with move

Louis Lazzara

Yes. Sure.

Mike Mears

All right.

Louis Lazzara

Thanks. Yes.

Mike Mears

Thanks.

Operator

have it Mears, you. to we Mr. this all I'll turn those the And are time. at questions back

Mike Mears

Magellan interest I right. you Well, time you their we will talk to thank soon. and and for want today for your everyone thank in All want I to to

Operator

you and Ladies your your disconnect line. our today. a and conference day may participation. great We thank concludes that all Have your you gentlemen, rest of for

Magellan Midstream Partners (MMP) 3 Feb 212020 Q4 Earnings call transcript