Energy Transfer Equity sees rise in earnings

Lower costs have propelled the second-quarter earnings of Energy Transfer Equity LP 82 %.

Meanwhile, the profits of its affiliate Energy Transfer Partners LP rose 39% in the latest quarter.

Investors likely will be scrutinizing the conference call for any signals regarding ETE’s efforts to acquire rival pipeline operator Williams Cos. in a multibillion tie-up that would give ETE a vastly expanded footprint.

Williams in June rejected ETE’s unsolicited offer initially valued at $48 billion. Williams said the offer significantly undervalued the company, setting the stage for a potential bidding

Companies that own pipelines and other energy infrastructure have been somewhat insulated from the dramatic drop in the price of oil and gas over the past year. That is because they tend to operate based on fixed-fee, long-term contracts that pay the same amount of money whether energy prices are high or low.

Overall, ETE reported a profit of $298 million, or 28 cents a common unit, up from $164 million, or 15 cents a unit, a year earlier. The latest period included a tax benefit of $56 million. Revenue decreased 18% to $11.59 billion.

Analysts polled by Thomson Reuters expected per-unit profit of 27 cents and revenue of $14.37 billion.

Total costs and expenses declined 20%.

Pipeline operator ETP reported a profit of $654 million, up from $471 million a year earlier. On a per-unit basis, which reflects general partner and other interests, the company’s earnings fell to 67 cents to 92 cents.

Revenue decreased 18% to $11.54 billion.

Analysts polled by Thomson Reuters expected per-unit profit of 48 cents and revenue of $12.98 billion.