Energy Transfer PartnersReports Quarterly Results for the Period Ended September 30th

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DALLAS--(Business Wire)--
Energy Transfer Partners, L.P. (NYSE:ETP) today reported EBITDA, as adjusted,
distributable cash flow, and net income for the quarter ended September 30,
2009. EBITDA, as adjusted, for the three months ended September 30, 2009 totaled
$281.8 million, a decrease of $51.0 million from the three months ended
September 30, 2008. Distributable cash flow for the three months ended September
30, 2009 totaled $155.6 million, a decrease of $54.3 million from the three
months ended September 30, 2008. Net income for the three months ended September
30, 2009 totaled $72.5 million, a decrease of $148.6 million from the three
months ended September 30, 2008. The decreases in these metrics between the
periods were primarily attributable to the impacts of lower natural gas prices
and weaker price differentials mainly across Texas.

For the nine months ended September 30, 2009, EBITDA, as adjusted, totaled $1.03
billion, a decrease of $34.9 million from the nine months ended September 30,
2008. Distributable cash flow for the nine months ended September 30, 2009 was
$731.7 million, a decrease of $77.5 million from the nine months ended September
30, 2008. Net income for the nine months ended September 30, 2009 totaled $530.4
million, a decrease of $184.7 million from the nine months ended September 30,
2008.

ETP also announced that it has filed its quarterly report on Form 10-Q for the
quarter ended September 30, 2009 with the Securities and Exchange Commission.
ETP has posted a copy of this Form 10-Q on its website at
www.energytransfer.com. The Partnership has scheduled a conference call for 9:00
a.m. Central Time, Tuesday, November 10, 2009 to discuss the third quarter
results. The conference call will be broadcast live via an internet web cast,
which can be accessed through www.energytransfer.com. The call will be available
for replay on the Partnership`s website for a limited time.

EBITDA, as adjusted, and distributable cash flow are non-GAAP financial measures
used by industry analysts, investors, lenders, and rating agencies to assess the
financial performance and the operating results of the Partnership`s fundamental
business activities and should not be considered in isolation or as a substitute
for net income, income from operations, cash flows from operating activities, or
other GAAP measures. A table reconciling EBITDA, as adjusted, and distributable
cash flow with appropriate GAAP financial measures is included in the summarized
financial information included in this release.

Energy Transfer Partners, L.P. (NYSE:ETP) is a publicly traded partnership
owning and operating a diversified portfolio of energy assets. ETP has pipeline
operations in Arizona, Colorado, Louisiana, New Mexico, and Utah, and owns the
largest intrastate pipeline system in Texas. ETP`s natural gas operations
include intrastate gathering and transportation pipelines, treating and
processing assets, and three storage facilities located in Texas. ETP currently
has more than 17,500 miles of pipeline in service and has a 50% interest in
joint ventures that have approximately 500 miles of interstate pipeline in
service. ETP is also one of the three largest retail marketers of propane in the
United States, serving more than one million customers across the country.

Energy Transfer Equity, L.P.(NYSE:ETE) is a publicly traded partnership, which
owns the general partner of Energy Transfer Partners and approximately 62.5
million ETP limited partners units.

The information contained in this press release is available on the
Partnership`s website at www.energytransfer.com.

ENERGY TRANSFER PARTNERS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except unit data)
(unaudited)

September 30, December 31,
2009 2008
ASSETS

CURRENT ASSETS:
Cash and cash equivalents $ 50,059 $ 91,902
Marketable securities 12,682 5,915
Accounts receivable, net of allowance for doubtful accounts 352,838 591,257
Accounts receivable from related companies 35,972 17,895
Inventories 221,148 272,348
Deposits paid to vendors 99,317 78,237
Exchanges receivable 15,434 45,209
Price risk management assets 6,841 5,423
Prepaid expenses and other current assets 67,680 75,215
Total current assets 861,971 1,183,401

PROPERTY, PLANT AND EQUIPMENT 9,616,309 8,996,911
ACCUMULATED DEPRECIATION (905,624 ) (700,826 )
8,710,685 8,296,085

ADVANCES TO AND INVESTMENTS IN AFFILIATES 550,950 10,110
GOODWILL 736,347 743,694
INTANGIBLES AND OTHER ASSETS, net 394,767 394,199

Total assets $ 11,254,720 $ 10,627,489

ENERGY TRANSFER PARTNERS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except unit data)
(unaudited)

September 30, December 31,
2009 2008
LIABILITIES AND PARTNERS' CAPITAL

CURRENT LIABILITIES:
Accounts payable $ 253,892 $ 381,135
Accounts payable to related companies 7,591 34,547
Exchanges payable 22,400 54,636
Customer advances and deposits 101,258 106,679
Accrued and other current liabilities 247,466 311,988
Price risk management liabilities 18,279 94,978
Interest payable 110,744 106,259
Income taxes payable 5,481 14,538
Deferred income taxes - 589
Current maturities of long-term debt 46,078 45,198

Total current liabilities 813,189 1,150,547

LONG-TERM DEBT, less current maturities 6,166,083 5,618,549
DEFERRED INCOME TAXES 105,156 100,597
OTHER NON-CURRENT LIABILITIES 21,076 14,727

COMMITMENTS AND CONTINGENCIES
7,105,504 6,884,420

PARTNERS` CAPITAL:
General Partner 169,038 161,159
Limited Partners:
Common Unitholders (168,834,045 and 152,102,471 units authorized, issued and outstanding at September 30, 2009 and December 31, 2008, respectively) 3,994,530 3,578,997
Class E Unitholders (8,853,832 units authorized, issued and outstanding - held by subsidiary and reported as treasury units) - -
Accumulated other comprehensive income (loss) (14,352 ) 2,913
Total partners` capital 4,149,216 3,743,069

Total liabilities and partners` capital $ 11,254,720 $ 10,627,489

ENERGY TRANSFER PARTNERS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per unit and unit data)
(unaudited)

Three Months Ended September 30, Nine Months Ended September 30,
2009 2008 2009 2008
REVENUES:
Natural gas operations $ 943,975 $ 1,938,586 $ 3,004,163 $ 6,322,070
Retail propane 162,224 238,830 829,901 1,086,417
Other 23,397 28,799 77,449 90,575
Total revenues 1,129,596 2,206,215 3,911,513 7,499,062

COSTS AND EXPENSES:
Cost of products sold - natural gas operations 591,797 1,435,308 1,865,914 4,965,145
Cost of products sold - retail propane 80,232 187,799 378,524 744,316
Cost of products sold - other 6,119 10,347 18,842 27,783
Operating expenses 158,883 197,493 517,337 573,606
Depreciation and amortization 81,684 70,508 230,461 191,757
Selling, general and administrative 33,534 44,252 143,015 136,632
Total costs and expenses 952,249 1,945,707 3,154,093 6,639,239

OPERATING INCOME 177,347 260,508 757,420 859,823

OTHER INCOME (EXPENSE):
Interest expense, net of interest capitalized (101,503 ) (67,792 ) (284,228 ) (191,757 )
Equity in earnings (losses) of affiliates 9,581 (654 ) 11,751 (749 )
Gains (losses) on disposal of assets (1,088 ) 2,520 (1,333 ) 1,584
Gains (losses) on non-hedged interest rate derivatives (18,241 ) 394 32,327 149
Allowance for equity funds used during construction 30 19,727 18,618 45,275
Other, net 3,433 (805 ) 4,400 9,486

INCOME BEFORE INCOME TAX EXPENSE (BENEFIT) 69,559 213,898 538,955 723,811
Income tax expense (benefit) (2,897 ) (7,150 ) 8,594 8,754

NET INCOME 72,456 221,048 530,361 715,057

GENERAL PARTNER'S INTEREST IN NET INCOME 88,927 80,252 266,396 233,599

LIMITED PARTNERS' INTEREST IN NET INCOME (LOSS) (1) $ (16,471 ) $ 140,796 $ 263,965 $ 481,458

BASIC NET INCOME (LOSS) PER LIMITED PARTNER UNIT (2) $ (0.10 ) $ 0.94 $ 1.60 $ 3.32

BASIC AVERAGE NUMBER OF UNITS OUTSTANDING 168,815,563 149,839,499 164,183,538 145,160,079

DILUTED NET INCOME (LOSS) PER LIMITED PARTNER UNIT (2) $ (0.10 ) $ 0.94 $ 1.59 $ 3.31

DILUTED AVERAGE NUMBER OF UNITS OUTSTANDING 168,815,563 150,248,194 164,886,492 145,615,088

(1) Based on the declared distribution rate of $0.89375 per Common Unit,
distributions to be paid for the three months ended September 30, 2009, are
$249.5 million in total, which exceeds net income for the period by $177.0
million. Accordingly, the distributions to be paid to the General Partner,
including incentive distributions, further exceeded the net income for the three
months ended September 30, 2009, and as a result, a net loss was allocated to
the Limited Partners for the period.

(2) Basic and diluted net income per limited partner unit amounts for the three
and nine months ended September 30, 2008 have been restated to reflect the
retrospective adoption of certain accounting principles on January 1, 2009. See
our quarterly report on Form 10-Q for the quarter ended September 30, 2009 for a
more detailed discussion.

Three Months Ended September 30, Nine Months Ended September 30,
SUPPLEMENTAL INFORMATION: 2009 2008 2009 2008
(unaudited)

Reconciliation of net income to EBITDA, as adjusted:
Net income $ 72,456 $ 221,048 $ 530,361 $ 715,057
Interest expense, net of interest capitalized 101,503 67,792 284,228 191,757
Income tax expense (benefit) (2,897 ) (7,150 ) 8,594 8,754
Depreciation and amortization 81,684 70,508 230,461 191,757
Non-cash compensation expense 6,459 2,378 20,942 14,338
(Gains) losses on disposal of assets 1,088 (2,520 ) 1,333 (1,584 )
(Gains) losses on non-hedged interest rate derivatives 18,241 (394 ) (32,327 ) (149 )
Allowance for equity funds used during construction (30 ) (19,727 ) (18,618 ) (45,275 )
Proportionate share of joint ventures' interest, depreciation and
allowance for equity funds used during construction 6,698 - 9,651 -
Other, net (3,433 ) 805 (4,400 ) (9,486 )
EBITDA, as adjusted (a) $ 281,769 $ 332,740 $ 1,030,225 $ 1,065,169

Reconciliation of net income to distributable cash flow:
Net income $ 72,456 $ 221,048 $ 530,361 $ 715,057
Amortization of finance costs charged to interest 2,234 1,665 6,386 4,240
Deferred income taxes (6,040 ) (4,672 ) 3,663 (3,781 )
Depreciation and amortization 81,684 70,508 230,461 191,757
Non-cash compensation expense 6,459 2,378 20,942 14,338
(Gains) losses on disposal of assets 1,088 (2,520 ) 1,333 (1,584 )
(Gains) losses on non-hedged interest rate derivatives 18,241 (394 ) (32,327 ) (149 )
Allowance for equity funds used during construction (30 ) (19,727 ) (18,618 ) (45,275 )
Unrealized (gains) losses on commodity derivatives not
in fair value hedging relationships (13,472 ) (34,390 ) 32,657 5,838
Unrealized (gains) losses on commodity derivatives and related
hedged inventory in fair value hedging relationships 16,361 - 3,863 -
Inventory lower of cost or market adjustments 9,408 - 54,029 -
Effect of previously recognized inventory hedging and lower of
cost or market adjustments on margin during the period - - (23,551 ) -
Distributions over (under) equity in earnings, net (5,266 ) 1,414 (5,696 ) 4,723
Maintenance capital expenditures (27,483 ) (25,357 ) (71,766 ) (75,931 )
Distributable cash flow (a) $ 155,640 $ 209,953 $ 731,737 $ 809,233

(a) The Partnership has disclosed in this press release EBITDA, as adjusted, and
distributable cash flow which are non-GAAP financial measures. Management
believes EBITDA, as adjusted, and distributable cash flow provide useful
information to investors as measure of comparison with peer companies, including
companies that may have different financing and capital structures. The
presentation of EBITDA, as adjusted, and distributable cash flow also allows
investors to view our performance in a manner similar to the methods used by
management and provides additional insight to our operating results.

There are material limitations to using measures such as EBITDA, as adjusted,
and distributable cash flow, including the difficulty associated with using
either as the sole measure to compare the results of one company to another, and
the inability to analyze certain significant items that directly affect a
company`s net income or loss or cash flows. In addition, our calculations of
EBITDA, as adjusted, and distributable cash flow may not be consistent with
similarly titled measures of other companies and should be viewed in conjunction
with measurements that are computed in accordance with GAAP, such as gross
margin, operating income, net income, and cash flow from operating activities.

Definition of EBITDA, as Adjusted

The Partnership defines EBITDA, as adjusted, as total partnership earnings
before interest, taxes, depreciation, amortization and other non-cash items,
such as compensation charges for unit issuances to employees and other expenses.
Non-cash compensation expense represents charges for the value of the grants
awarded under the Partnership`s compensation plans over the vesting terms of
those plans and are charges which do not, or will not, require cash settlement.
Non-cash income or loss such as the gain or loss arising from disposal of assets
is not included when determining EBITDA, as adjusted.

EBITDA, as adjusted, is used by management to determine our operating
performance and, along with other data, as internal measures for setting annual
operating budgets, assessing financial performance of our numerous business
locations, as a measure for evaluating targeted businesses for acquisition and
as a measurement component of incentive compensation.

Definition of Distributable Cash Flow

The Partnership defines distributable cash flow as total partnership earnings,
adjusted for certain non-cash amounts recorded in earnings, less maintenance
capital expenditures. Non-cash amounts recorded in earnings include depreciation
and amortization, deferred taxes, impairment losses, allowance for equity funds
used during construction, and certain realized and unrealized gains and losses.
Distributable cash flow also reflects earnings from affiliates on a cash basis.

Distributable cash flow is used by management to evaluate our overall
performance. Our partnership agreement requires us to distribute all available
cash, and distributable cash flow is calculated to evaluate our ability to fund
distributions through cash generated by our operations.

REPORTABLE SEGMENTS (unaudited)
Three Months Ended September 30, Nine Months Ended September 30,
2009 2008 2009 2008
Intrastate transportation and storage:
Natural gas MMBtu/d - transported 11,111,011 11,613,933 12,769,022 10,515,132
Natural gas MMBtu/d - sold 886,463 1,409,348 879,861 1,556,524

Revenues (including intersegment) $ 466,713 $ 1,509,555 $ 1,589,298 $ 4,862,641
Cost of products sold 278,868 1,150,799 895,433 3,965,931
Gross margin 187,845 358,756 693,865 896,710

Operating expenses 45,053 86,332 155,461 227,026
Depreciation and amortization 27,188 23,820 78,080 60,293
Selling, general and administrative 5,823 18,683 49,899 55,251
Segment operating income $ 109,781 $ 229,921 $ 410,425 $ 554,140

Interstate transportation:
Natural gas MMBtu/d - transported 1,688,388 1,862,781 1,706,199 1,750,592
Natural gas MMBtu/d - sold 19,060 14,784 19,481 13,094

Revenues $ 71,415 $ 62,023 $ 203,349 $ 176,663
Operating expenses 13,718 13,278 46,427 39,128
Depreciation and amortization 12,521 9,637 36,017 28,204
Selling, general and administrative 3,566 5,410 19,150 17,917
Segment operating income $ 41,610 $ 33,698 $ 101,755 $ 91,414

Midstream:
Natural gas MMBtu/d - sold 1,021,963 1,344,033 1,009,547 1,361,295
NGLs Bbls/d - sold 39,486 24,019 40,345 27,618

Revenues (including intersegment) $ 573,066 $ 1,435,157 $ 1,750,466 $ 4,555,340
Cost of products sold 480,746 1,352,658 1,510,030 4,271,788
Gross margin 92,320 82,499 240,436 283,552

Operating expenses 16,054 16,661 50,858 50,792
Depreciation and amortization 18,091 16,669 51,792 44,004
Selling, general and administrative 14,761 9,307 41,183 31,239
Segment operating income $ 43,414 $ 39,862 $ 96,603 $ 157,517

Retail propane and other retail propane related:
Retail propane gallons (in thousands) 87,569 90,386 398,202 422,109

Retail propane revenues $ 162,224 $ 238,830 $ 829,901 $ 1,086,417
Other retail propane related revenues 22,063 24,736 72,570 76,524
Retail propane cost of products sold 80,232 187,799 378,524 744,316
Other retail propane related cost of products sold 4,796 7,604 14,495 17,099
Gross margin 99,259 68,163 509,452 401,526

Operating expenses 81,298 79,843 259,768 253,193
Depreciation and amortization 23,031 20,255 63,477 58,828
Selling, general and administrative 11,480 7,793 34,128 27,800
Segment operating income (loss) $ (16,550 ) $ (39,728 ) $ 152,079 $ 61,705

All other $ (3,021 ) $ (186 ) $ (4,803 ) $ (528 )

Selling, general and administrative expenses not allocated to segments 2,113 (3,059 ) 1,361 (4,425 )
Total operating income $ 177,347 $ 260,508 $ 757,420 $ 859,823

Other items not allocated by segment:
Interest expense, net of interest capitalized $ (101,503 ) $ (67,792 ) $ (284,228 ) $ (191,757 )
Equity in earnings (losses) of affiliates 9,581 (654 ) 11,751 (749 )
Gains (losses) on disposal of assets (1,088 ) 2,520 (1,333 ) 1,584
Gains (losses) on non-hedged interest rate derivatives (18,241 ) 394 32,327 149
Allowance for equity funds used during construction 30 19,727 18,618 45,275
Other, net 3,433 (805 ) 4,400 9,486
Income tax expense 2,897 7,150 (8,594 ) (8,754 )
(104,891 ) (39,460 ) (227,059 ) (144,766 )
Net income $ 72,456 $ 221,048 $ 530,361 $ 715,057

Investor Relations:
Energy Transfer
Brent Ratliff, 214-981-0700
or
Media Relations:
Granado Communications Group
Vicki Granado, 214-504-2260
214-498-9272 (cell)

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