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Page 17 - Sponsored Vehicles

SPECTRA ENERGY PARTNERS, LP filed this Form SC 13D/A on 11/30/2017


 

 

 

Commenting on the dividend increase, Mr. Monaco noted: “Over the decades, Enbridge has delivered superior shareholder value. Our low risk business model has resulted in strong and consistent growth in the dividend which we are continuing to deliver though this Plan period.”

 

Sponsored Vehicles

 

Three-year financial plans for the sponsored vehicles were also approved by Enbridge, as well as the Boards of Directors of Spectra Energy Partners, Enbridge Energy Partners and Enbridge Income Fund. Each of the Sponsored vehicles is expected to maintain solid distribution growth, strong distribution coverage, and solid investment grade credit ratings:

 

·Enbridge Income Fund Holdings (ENF:TSX) announced today that it will increase its monthly dividend by 10% effective with the dividend payable on February 15, 2018. In addition, the robust long term outlook for distribution growth at Enbridge Income Fund (the Fund) will now support extension of annual dividend increases of 10% to ENF shareholders through 2020. ENF also announced a $0.5 billion common equity bought deal issuance, which along with a $0.1 billion common equity issuance to Enbridge to maintain Enbridge’s 19.9% common equity interest in ENF, will be used to increase its ownership in the Fund. The Fund is expected to realize strong EBITDA growth over the planning horizon while maintaining distribution coverage of 1.2x to 1.3x. The Fund Group credit metrics are expected to strengthen over the forecast horizon as a result of growing EBITDA from strong business performance and its secured capital program, and bolstered by the common equity investment by ENF which satisfies the Fund Group’s equity requirements through 2020. Debt to EBITDA levels are forecast to be below 5.0x by the end of 2018 and remain below this level for the remainder of the outlook period.

  

·Enbridge Energy Partners, L.P. (EEP) (NYSE:EEP) is now comprised of highly predictable, stable cash generating assets, including the U.S. portion of the Enbridge’s crude oil mainline system. EEP is expected to generate distributable cash flow per unit growth of approximately 3% through 2020. Management expects distribution growth to approximately follow distributable cash flow growth. Distribution coverage of approximately 1.2x is targeted throughout the planning period. The Partnership expects consolidated Debt to EBITDA to be approximately 4.0x by 2020, once its liquids pipeline growth projects are placed into service and its call options in joint funding arrangements have been exercised.

 

·Spectra Energy Partners L.P. (SEP) (NYSE:SEP) is expected to deliver on its targeted $0.0125/unit quarterly distribution increase through 2018, which equates to ~7% distribution growth next year, with distribution coverage of 1.1x-1.2x. After 2018, the execution of the current secured organic growth plan alone supports distribution growth of 4% – 6% annually in 2019 and 2020, while maintaining distribution coverage of 1.1x to 1.2x. This outlook could be further enhanced with additional organic growth and future drop down transactions. The Debt to EBITDA metric is expected to remain below 4.0x through 2020.