Mr. Al Monaco reports
ENBRIDGE INC. REPORTS SECOND QUARTER 2017 RESULTS
Enbridge Inc. had second quarter 2017 adjusted EBIT (earnings before interest and tax) of $1,713-million. Second quarter ACFFO (available cash flow from operations) was $1,324-million, or 81 cents per common share. This was the first full quarter of operations subsequent to the merger transaction that closed on Feb. 27, 2017.
Second quarter highlights:
- Earnings were $919-million or 56 cents per common share for the second quarter and $1,557-million or $1.11 per common share for the six-month period, both including the impact of a number of unusual, non-recurring or non-operating factors.
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Adjusted earnings were $662-million or 41 cents per common share for the second quarter and $1,337-million or 95 cents per common share for the six-month period.
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Adjusted earnings before interest and income taxes (EBIT) were $1,713-million for the second quarter and $3,228-million for the six-month period.
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Available cash flow from operations (ACFFO) was $1,324-million or 81 cents per common share for the second quarter and $2,539-million or $1.81 per common share for the six-month period; 2017 ACFFO per share guidance range is unchanged at $3.60 to $3.90 per share.
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On June 1, 2017, Enbridge paid a previously announced quarterly dividend on its common shares of 61 cents per share, a 15-per-cent increase over the quarterly dividend paid on June 1, 2016.
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Enbridge announced today that it will begin construction this summer to replace certain segments of the Line 3 pipeline in Canada; in the United States, construction has begun in Wisconsin. The Line 3 replacement program is expected to come into service in the second half of 2019.
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Enbridge continued the execution of its secured growth program bringing an additional $5-billion of growth projects into service during the quarter.
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In June, 2017, Enbridge announced that it had secured the $1-billion T-South natural gas pipeline expansion in British Columbia, the $500-million Spruce Ridge expansion on the T-North natural gas network in British Columbia and the $400-million expansion of the Hohe See offshore wind project in Germany.
- Subsequent to the first quarter of 2017, the company further strengthened its financial position with the issuance of $1-billion (U.S.) of hybrid debt securities and made significant progress on its capital financing plan by issuing over $5-billion of term debt, primarily to refinance long-term debt at favourable rates.
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On July 31, 2017, Enbridge completed the sale of its interest in the Olympic refined products pipeline for $200-million. This sale further bolsters the balance sheet and brings total asset monetizations executed to $2.5-billion since the announcement of the merger with Spectra Energy Corp.
The largest driver of EBIT growth for the second quarter of 2017 relative to the second quarter of 2016 was the contribution of Enbridge's new natural gas assets acquired in the merger transaction, which has substantially diversified the company's asset base and business platforms. Also contributing to year-over-year growth was improved performance from green power and transmission and the impact of a stronger U.S. dollar. These positive contributors were partially offset by lower results in energy services and liquids pipelines.
Liquids pipelines' results for the quarter were impacted by several transitory items including a significant unexpected outage and accelerated maintenance at a customer's upstream facility, additional related and unrelated production disruptions, and a hydrostatic testing program on Line 5 during the month of June, 2017. The combined adjusted EBIT impact on the Canadian and U.S. mainline system of these factors was approximately $50-million in the quarter. Up until the month of June, the mainline system had been delivering near-record volumes and operating under apportionment in heavy crude oil service. Apportionment on the mainline system also impacted the EBIT contribution of certain downstream pipelines during the quarter.
EBIT generated by liquids pipelines is expected to grow over the second half of 2017 as throughput on the mainline system returns to levels achieved earlier in the year. This is driven in part by capacity optimization projects completed in the first half of the year that will address capacity constraints and help alleviate apportionment.
ACFFO for the second quarter was $1,324-million, an increase of $456-million over the comparable prior period, driven largely by the same factors noted above. ACFFO of 81 cents per share was lower than the prior period primarily as a result of the issuance of additional shares as consideration under the merger transaction.
"Our financial results this quarter highlight the benefits of having a well-diversified portfolio of businesses and growth platforms," said Al Monaco, president and chief executive officer. "The overall performance of the U.S. gas transmission assets that we acquired in connection with the merger transaction has been solid and as expected. We anticipate the performance of our liquids pipelines business to strengthen over the balance of the year as production and throughput ramps back up on the mainline system and we benefit from capacity optimization initiatives that have been implemented to accommodate greater heavy volumes. Given the strengthening outlook for liquids pipelines, the success we are having in executing our secured growth program, and our progress in driving out synergies from the merger transaction thus far, we remain right on track for delivering financial results in line with the guidance we provided earlier in the year."
Commenting on the overall strategic positioning and near-term outlook for the business, Mr. Monaco noted: "I'm pleased with the progress that we've made in this first full quarter since we merged with Spectra Energy. Management is keenly focused on the key strategic priorities that we laid out at our midyear investor update which include: growing organically, minimizing risk and streamlining the organization. Since the end of the first quarter, we've brought $5-billion of projects into service, added high-quality, low-risk organic projects to our inventory of secured growth projects, executed on our funding plans, and strengthened the balance sheet. Our integration and synergy realization plans remain right on track and we continue to optimize the performance of our existing assets while operating safely and reliably. Entering the second half of the year, we are well positioned to deliver growing cash flow in line with expectations, and we look forward to our core business and projects coming into service this year and next driving growing cash flows in 2018 and 2019."
Line 3 replacement program
Enbridge announced today that it will begin construction this summer on certain segments of the Line 3 replacement program in Canada and that construction in Wisconsin has commenced. This program entails a full replacement of the existing pipeline which runs from Hardisty, Alta., to Superior, Wis.
All required regulatory permitting is in place to proceed with the Canadian construction work. Regulatory permitting is also in place for construction in North Dakota and in Wisconsin. The only remaining jurisdiction in which the regulatory permitting process is still under way is in Minnesota, where the Minnesota Department of Commerce is expected to release a final environmental impact statement in the third quarter of 2017. Based on the expected regulatory process and timeline, management's anticipated in-service date for the project is the second half of 2019.
Given the updated execution plan, the finalized cost estimate for the project is now $5.3-billion in Canada and $2.9-billion (U.S.) in the United States. The revised cost is approximately 9 per cent above the original estimate at the time of project sanctioning in 2014, and primarily reflects delays in the regulatory process, scope changes and route modifications as well as other changes that resulted from the extensive consultation process. The impact of these additional costs on project returns are fully offset by lower estimated operating costs and a stronger U.S. dollar relative to the original project assumptions.
"Line 3 is a critical piece of energy infrastructure that supports our economy and assures reliable and cost-effective supply of energy," commented Mr. Monaco. "The new Line 3 will comprise the newest and most advanced pipeline technology and provide much-needed incremental capacity to support Canadian crude oil production growth and United States and Canadian refinery demand."
Project execution
Enbridge continued to execute on its secured growth capital program, bringing an additional $5-billion of projects into service this quarter, including Sabal Trail Transmission LLC's natural gas pipeline, the Norlite pipeline system and its equity investment in the Bakken pipeline system (which commenced service during the quarter). This brings the total growth capital projects brought into service to well over $6-billion thus far in 2017. Over the remainder of this year, the company expects to bring a further $7-billion of growth projects into service. All of these projects are supported by low-risk long-term take-or-pay contracts, cost-of-service frameworks or similar commercial arrangements, and will provide a significant uplift to cash flow as they come into service.
New secured growth projects
At its midyear investor conference in June, Enbridge announced the addition of $1.9-billion of new secured growth projects.
Following a highly successful open season, Enbridge is proceeding with the $1-billion T-South natural gas pipeline expansion project. This expansion will add 190 million cubic feet per day of additional capacity supported by long-term contracts under a cost-of-service framework, and will enable greater access for growing Montney production to attractive demand pull markets in the Pacific Northwest by late 2020. Enbridge is also proceeding with the expansion of several segments of the T-North natural gas gathering and transportation system in British Columbia to facilitate better access and connectivity to regional infrastructure. The $500-million Spruce Ridge program is supported by long-term contracts under a cost-of-service framework and is expected to come into service in the second half of 2018.
The sanctioning of the $400-million Hohe See expansion project brings Enbridge's total investment in this facility to $2.1-billion. As co-developer, Enbridge will participate in the construction and operation of the project, which is supported by long-term fixed-price power purchase contracts. Completion of this low-risk and immediately accretive project is expected in the second half of 2019.
"We've now successfully secured almost $4-billion of new projects since the merger transaction was announced," noted Mr. Monaco. "Our success reflects the strength of our diversified business model, which incorporates six strategic growth platforms post the merger transaction. These new projects are a great fit with Enbridge's investor value proposition, extending our industry leading $31-billion secured capital program into 2020, and supporting our long-term dividend growth outlook of 10 to 12 per cent through 2024."
Financing progress
During the second quarter of 2017, Enbridge was active in the capital markets, making significant progress on the execution of its financing plan.
Since the end of the first quarter, the company has raised over $5-billion of term debt in both the U.S. and Canadian markets across a range of maturities, the proceeds of which were primarily used to refinance existing or maturing debt at favourable rates. In July, Enbridge successfully completed tender offers for approximately $1-billion (U.S.) of outstanding Spectra Energy Capital LLC term debt as part of a continuing effort to streamline and simplify the company's financing structure and further reduce its cost of capital.
On July 14, 2017, Enbridge further strengthened its balance sheet with the issuance of $1-billion (U.S.) of hybrid securities. In addition, the company closed the sale of its interest in the Olympic pipeline for $200-million on July 31, 2017, increasing the total asset monetizations to $2.5-billion since the announcement of the merger transaction. Enbridge will continue to assess its overall asset portfolio for opportunities to selectively monetize non-core assets and free up capital for redeployment to its growth program.
Quarterly dividend
On June 1, 2017, Enbridge paid a previously announced quarterly dividend on its common shares of 61 cents per share. On Jan. 5, 2017, the company announced that it would increase its quarterly common share dividend from 53 cents per share to 58.3 cents per share effective with the dividend payable on March 1, 2017. Following the successful closing of the merger with Spectra Energy, the company announced a further 2.7-cent-per-share increase in the company's common share dividend to be effective with the dividend payable on June 1, 2017. Together, these increases represent a 15-per-cent increase over the prevailing quarterly rate in 2016.
SECOND QUARTER 2017 PERFORMANCE OVERVIEW
(millions of dollars, except per-share amounts)
Three months ended Six months ended
June 30 June 30
2017 2016 2017 2016
Earnings attributable to common shareholders
Liquids pipelines $1,272 $643 $2,396 $2,255
Gas pipelines and processing 682 19 1,021 80
Gas distribution 153 83 428 322
Green power and transmission 51 41 101 90
Energy services (loss) (18) (7) 138 (13)
Eliminations and other (loss) (41) (48) (356) 173
----- ----- ----- -----
Earnings before interest and income taxes 2,099 731 3,728 2,907
Interest (expense) (565) (369) (1,051) (781)
Income tax (expense) (293) (10) (491) (427)
(Earnings)/loss attributable to non-controlling
interests and redeemable non-controlling interests (241) 20 (465) (41)
Preference share dividends (loss) (81) (71) (164) (144)
----- ----- ----- -----
Earnings attributable to common shareholders 919 301 1,557 1,514
Earnings per common share 0.56 0.33 1.11 1.69
Diluted earnings per common share 0.56 0.33 1.10 1.67
===== ===== ===== =====
Adjusted earnings
Liquids pipelines 938 922 1,908 2,006
Gas pipelines and processing 667 90 1,003 177
Gas distribution 153 73 422 313
Green power and transmission 51 40 101 88
Energy services (loss) (3) 47 (8) 48
Eliminations and other (loss) (93) (83) (198) (169)
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Adjusted earnings before interest and
income taxes (1) 1,713 1,089 3,228 2,463
Interest (expense) (2) (588) (363) (1,053) (757)
Income taxes (loss) (2) (194) (131) (338) (307)
Non-controlling interests and redeemable
non-controlling interests (loss) (2) (188) (68) (336) (136)
Preference share dividends (loss) (81) (71) (164) (144)
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Adjusted earnings (1) 662 456 1,337 1,119
Adjusted earnings per common share (1) 0.41 0.50 0.95 1.25
===== ===== ===== =====
Cash flow data
Cash provided by operating activities 2,033 1,370 3,710 3,231
Cash used in investing activities (loss) (2,368) (2,080) (5,891) (3,932)
Cash provided by financing activities 531 230 2,124 981
===== ===== ===== =====
Available cash flow from operations (3)
Available cash flow from operations 1,324 868 2,539 1,982
Available cash flow from operations per common share 0.81 0.95 1.81 2.21
===== ===== ===== =====
Dividends
Common share dividends declared 1,003 492 1,551 952
Dividends paid per common share 0.610 0.530 1.193 1.060
Three months ended Six months ended
June 30 June 30
2017 2016 2017 2016
Operating data
Liquids pipelines -- average
deliveries (thousands of bpd)
Canadian mainline (4) 2,449 2,242 2,521 2,392
Lakehead system (5) 2,604 2,440 2,675 2,588
Regional oil sands system (6) 1,171 823 1,228 987
Gas pipelines -- average
throughput (mmcf/d)
Alliance Pipeline Canada 1,519 1,559 1,574 1,587
Alliance Pipeline U.S. 1,623 1,698 1,674 1,724
Canadian mid-stream (7) 2,177 - 2,458 -
Gas pipelines and processing -- volumes
processed (mmcf/d)
Canadian mid-stream (8) 1,715 - 1,875 -
U.S. mid-stream (9) 5,422 1,141 5,591 1,154
Gas pipelines and processing -- natural gas
liquids (NGL) production (thousands of bpd)
U.S. mid-stream (9) 518 159 516 149
Gas distribution -- Enbridge Gas
Distribution Inc. (EGD)
Volumes (billions of cubic feet) 71 78 243 251
Number of active customers (thousands) (10) 2,167 2,133 2,167 2,133
Heating degree days (11)
Actual 462 546 2,148 2,255
Forecast based on
normal weather volume 476 478 2,351 2,309
Gas distribution -- Union Gas Ltd.
volumes (billions of cubic feet) 222 - 371 -
Number of active customers (thousands) (10) 1,465 - 1,465 -
Heating degree days (11)
Actual 492 - 1,093 -
Forecast based on normal weather volume 514 - 1,090 -
(1) Adjusted EBIT, adjusted earnings and adjusted earnings per common share are non-GAAP
(generally accepted accounting principles) measures that do not have any standardized
meaning prescribed by GAAP.
(2) These balances are presented net of adjusting items.
(3) ACFFO is defined as cash flow provided by operating activities before changes in
operating assets and liabilities (including changes in environmental liabilities) less
distributions to non-controlling interests and redeemable non-controlling interests,
preference share dividends and maintenance capital expenditures, and further adjusted for
unusual, non-recurring or non-operating factors. ACFFO and ACFFO per common share are
non-GAAP measures that do not have any standardized meaning prescribed by GAAP.
(4) Canadian mainline throughput volume represents mainline system deliveries ex-Gretna,
Man., which is made up of U.S. and Eastern Canada deliveries originating from
Western Canada.
(5) Lakehead pipeline system throughput volume represents mainline system deliveries to
the U.S. Midwest and Eastern Canada.
(6) Volumes are for the Athabasca mainline, Athabasca Twin, Waupisoo pipeline and Woodland
pipeline and exclude laterals on the regional oil sands system.
(7) Canadian mid-stream throughput volumes represent throughput from the Western Canada
transmission and processing assets only.
(8) Canadian mid-stream processing volumes represent the volumes processed through the Tupper
Main and Tupper West gas plants and the Western Canada transmission and processing assets.
(9) U.S. mid-stream processing volumes and NGL production represent the volumes processed and
produced from the field services assets and the Midcoast Energy Partnership assets as well
as the Aux Sable processing plant.
(10) Number of active customers is the number of natural gas consuming EGD and Union Gas
customers at the end of the period.
(11) Heating degree days are a measure of coldness that is indicative of volumetric
requirements for natural gas utilized for heating purposes in EGD's and Union Gas's
franchise area. It is calculated by accumulating, for the fiscal period, the total number
of degrees each day by which the daily mean temperature falls below 18 C. The figures given
are those accumulated in the Greater Toronto Area.
Earnings before interest and income taxes
For the three and six months ended June 30, 2017, EBIT was $2,099-million and $3,728-million, respectively, compared with $731-million and $2,907-million for the three and six months ended June 30, 2016. Earnings for the three and six months ended June 30, 2017, were positively impacted by contributions from new assets following the completion of the merger transaction.
The positive impact to EBIT resulting from the merger transaction's new assets was partially offset by lower results in the energy services and liquids pipelines segments as discussed below.
The comparability of the company's earnings period over period is also impacted by a number of unusual, non-recurring or non-operating factors that are enumerated in the non-GAAP reconciliation tables on the company's website, the most significant of which are changes in unrealized derivative fair value gains and losses. For the three months ended June 30, 2017, the company's EBIT reflected $461-million of unrealized derivative fair value gains, compared with losses of $98-million in the corresponding 2016 period. For the six months ended June 30, 2017, the company's EBIT reflected $877-million of unrealized derivative fair value gains, compared with gains of $834-million in the corresponding 2016 period. The company has a comprehensive long-term economic hedging program to mitigate interest rate, foreign exchange and commodity price risks which creates volatility in short-term earnings. Over the long term, Enbridge believes its hedging program supports the reliable cash flows and dividend growth upon which the company's investor value proposition is based.
In addition, the comparability of period-over-period EBIT was impacted by the recognition of an impairment of $176-million ($103-million after tax attributable to Enbridge) in the second quarter of 2016 related to Enbridge's 75-per-cent joint venture interest in Eddystone Rail Company LLC, a rail-to-barge transloading facility located in Greater Philadelphia, Penn.
EBIT for the six months ended June 30, 2017, also reflected charges of $178-million ($130-million after tax) with respect to costs incurred in conjunction with the merger transaction, as well as $208-million ($146-million after tax) of employee severance costs in relation to the company's enterprise-wide reduction of work force in March, 2017, and restructuring costs in connection with the completion of the merger transaction.
Earnings attributable to common shareholders
Earnings attributable to common shareholders for the three months ended June 30, 2017, were $919-million, or 56 cents per common share, compared with $301-million, or 33 cents per common share, for the three months ended June 30, 2016. Earnings attributable to common shareholders for the six months ended June 30, 2017, were $1,557-million, or $1.11 per common share, compared with $1,514-million, or $1.69 per common share, for the six months ended June 30, 2016.
In addition to the factors discussed in EBIT above, interest expense for the three and six months ended June 30, 2017, was higher, compared with the corresponding 2016 periods, as a result of debt assumed in the merger transaction. Preference share dividends were also higher reflecting additional preference shares issued in the fourth quarter of 2016 to partially finance the company's growth capital program.
Income tax expense increased for the three and six months ended June 30, 2017, compared with the corresponding 2016 periods, largely due to the increase in earnings.
Earnings attributable to non-controlling interests and redeemable non-controlling interests increased in the second quarter and the first half of 2017, compared with the corresponding 2016 periods. The increase was driven by additional non-controlling interests associated with the assets acquired in the merger transaction and lower earnings attributable to non-controlling interests in Enbridge Energy Partners LP during 2016.
Lower earnings per common share for the six months ended June 30, 2017, compared with the corresponding 2016 period, reflected the issuance of approximately 691 million common shares in February, 2017, as part of the consideration for the merger transaction, the issuance of approximately 75 million common shares in 2016 through a 56-million-follow-on-common-share offering in the first quarter of 2016, and continuing issuances under the company's dividend reinvestment program.
Adjusted earnings before interest and income taxes
For the three and six months ended June 30, 2017, adjusted EBIT was $1,713-million and $3,228-million, respectively, an increase of $624-million and $765-million over the corresponding three- and six-month periods in 2016. The largest driver of adjusted EBIT growth over the prior-year periods was the contributions of new assets acquired in the merger transaction. Also contributing to the period-over-period growth in adjusted EBIT were increased contributions from the green power and transmission segment. These positive contributions were partially offset by warmer weather in the franchise areas served by the company's gas distribution utilities and lower results in the energy services and liquids pipelines segments.
Growth in adjusted EBIT was most pronounced in the gas pipelines and processing segment, where a majority of the new assets acquired through the merger transaction are reported. Growth for this segment also reflected contributions from the Tupper Main and Tupper West gas plants acquired in April, 2016.
Excluding contributions from Express-Platte as part of the merger transaction, liquids pipelines adjusted EBIT decreased in the three and six months ended June 30, 2017, compared with the corresponding 2016 periods. The second quarter of 2017 was impacted by several transitory items including a significant unexpected outage and accelerated maintenance at a customer's upstream facility, additional related and unrelated production disruptions, and a hydrostatic testing program on Line 5 during the month of June, 2017. The combined impact on the mainline system of these factors was approximately $50-million in the second quarter of 2017. Up until the month of June, the mainline system had been delivering near record volumes and operating under apportionment in heavy crude oil service. Apportionment on the mainline system also impacted the adjusted EBIT contribution of certain downstream pipelines during the first and second quarters of 2017. Liquids pipelines reported performance was further impacted by a change in practice whereby the company no longer includes cash received under certain take-or-pay contracts with makeup rights in its determination of adjusted EBIT. In addition, the divestiture of certain assets and lower surcharge revenues decreased adjusted EBIT. Adjusted EBIT generated by liquids pipelines is expected to grow over the second half of 2017 as throughput on the mainline system is expected to return to record levels achieved earlier in the year and capacity optimization projects, undertaken in the first half of the year to alleviate apportionment on the mainline system, are operationalized.
Within the gas distribution segment, EGD generated lower adjusted EBIT for the six months ended June 30, 2017, compared with the corresponding 2016 period, primarily due to lower distribution revenues attributable to warmer-than-normal weather in the first half of 2017. Effective Jan. 1, 2017, EGD ceased to exclude the effect of warmer/colder weather from its adjusted EBIT. In the first half of 2017, warmer-than-normal weather impacted EGD's adjusted EBIT by approximately $23-million. The period-over-period decrease in EGD's adjusted EBIT was more than offset by contributions from Union Gas since the completion of the merger transaction.
Energy Services adjusted EBIT for the three and six months ended June 30, 2017, reflected compressed location and quality differentials in certain markets, lower refinery demand for certain products and fewer opportunities to achieve profitable margins on facilities where the company holds capacity obligations. Adjusted EBIT from energy services is dependent on market conditions and results achieved in one period may not be indicative of results to be achieved in future periods.
The increase in adjusted loss before interest and income taxes reported within eliminations and other reflects higher unallocated corporate costs which primarily resulted from the merger transaction, partially offset by synergies achieved thus far on integration of corporate functions.
Adjusted earnings
Adjusted earnings were $662-million, or 41 cents per common share, for the three months ended June 30, 2017, compared with $456-million, or 50 cents per common share, for the three months ended June 30, 2016. Adjusted earnings were $1,337-million, or 95 cents per common share, for the six months ended June 30, 2017, compared with $1,119-million, or $1.25 per common share, for the six months ended June 30, 2016.
In addition to the factors discussed in adjusted earnings before interest and income taxes above, the comparability of adjusted earnings is consistent with the discussion in earnings attributable to common shareholders above.
Available cash flow from operations
ACFFO for the three months ended June 30, 2017, was $1,324-million, or 81 cents per common share, compared with $868-million, or 95 cents per common share, for the three months ended June 30, 2016. ACFFO was $2,539-million, or $1.81 per common share, for the six months ended June 30, 2017, compared with $1,982-million, or $2.21 per common share, for the six months ended June 30, 2016. The year-over-year growth in ACFFO was driven by the same factors as discussed in adjusted EBIT above, as well as other items discussed below. However, ACFFO per common share has decreased quarter over quarter due to the increase in the number of common shares outstanding which resulted from the completion of the merger transaction, and other issuances in 2016, as noted above in earnings attributable to common shareholders.
Also contributing to the quarter-over-quarter increase in ACFFO were higher cash distributions that the company received from its equity investments, resulting from their improved operating performance as well as distributions from newly acquired equity investments which were a part of the merger transaction.
The above positive effects on ACFFO quarter over quarter were partially offset by higher maintenance capital expenditures in the first half of 2017, which reflected the spending on assets acquired in the merger transaction and higher spending in liquids pipelines on certain leasehold improvements. The increase was partially offset by a decrease in maintenance capital expenditures in the gas distribution segment due to the timing of higher spending in 2016 on EGD's work and asset management system program; and a decrease, excluding the effect of the merger transaction, in the gas pipelines and processing segment due to a shift in the timing of maintenance capital expenditures to the later quarters of 2017.
Also partially offsetting the increase in ACFFO was higher interest expense and higher preference share dividends for the three and six months ended June 30, 2017, compared with the corresponding periods, as discussed in earnings attributable to common shareholders above.
The increase in ACFFO quarter over quarter was also impacted by the increased distributions to non-controlling interests related to assets acquired in the merger transaction, which was partially offset by the decrease in distributions to non-controlling interests in EEP resulting from the reduction in its quarterly distribution as well as the purchase of Midcoast Energy Partners LP's outstanding publicly held common units. Refer to U.S. sponsored vehicle strategy in the company's management's discussion and analysis.
Also offsetting the positive effects on ACFFO were higher distributions to redeemable non-controlling interests due to increased public ownership in the fund group (comprising the Enbridge Income Fund, Enbridge Commercial Trust, Enbridge Income Partners LP (EIPLP), and the subsidiaries and investees of EIPLP) resulting from Enbridge Income Fund Holdings Inc.'s secondary offering in the second quarter of 2017.
Other non-cash adjustments include various non-cash items presented in the company's consolidated statements of cash flows, as well as adjustments for unearned revenues received in each period.
Conference call
Enbridge will host a joint conference call and webcast on Thursday, Aug. 3, 2017, at 9 a.m. Eastern Time (7 a.m. Mountain Time) with Enbridge Income Fund Holdings Inc., Enbridge Energy Partners LP and Spectra Energy Partners LP to discuss the second quarter 2017 results. Analysts, members of the media and other interested parties can access the call toll-free at 877-930-8043 or within and outside North America at 253-336-7522 using the access code of 51403910 followed by the number sign. The call will be audio webcast live on-line. A webcast replay and podcast will be available approximately two hours after the conclusion of the event and a transcript will be posted to the website within 24 hours. The replay will be available for seven days after the call toll-free 855-859-2056 or within and outside North America at 404-537-3406 (access code 51403910 followed by the number sign).
The conference call format will include prepared remarks from the executive team followed by a question-and-answer session for the analyst and investor community only. Enbridge's media and investor relations teams will be available after the call for any additional questions.
About Enbridge Inc.
Enbridge is North America's premier energy infrastructure company with strategic business platforms that include an extensive network of crude oil, liquids and natural gas pipelines, regulated natural gas distribution utilities, and renewable power generation. The company safely delivers an average of 2.8 million barrels of crude oil each day through its mainline and express pipeline, the majority of which accounts for approximately 65 per cent of U.S.-bound Canadian crude oil exports, and moves approximately 20 per cent of all natural gas consumed in the United States serving key supply basins and demand markets. The company's regulated utilities serve approximately 3.5 million retail customers in Ontario, Quebec, New Brunswick and New York State. Enbridge also has a growing involvement in electricity infrastructure with interests in more than 2,500 megawatt-hours of net renewable generating capacity in North America and an expanding offshore wind portfolio in Europe.
Dividend declaration
On Aug. 2, 2017, the Enbridge board of directors declared the following quarterly dividends. All dividends are payable on Sept. 1, 2017, to shareholders of record on Aug. 15, 2017.
Common shares 61 cents
Preference shares, Series A 34.375 cents
Preference shares, Series B1 21.34 cents
Preference shares, Series C2 18.6 cents
Preference shares, Series D 25 cents
Preference shares, Series F 25 cents
Preference shares, Series H 25 cents
Preference shares, Series J3 30.54 U.S. cents
Preference shares, Series L 25 U.S. cents
Preference shares, Series N 25 cents
Preference shares, Series P 25 cents
Preference shares, Series R 25 cents
Preference shares, Series 1 25 U.S. cents
Preference shares, Series 3 25 cents
Preference shares, Series 5 27.5 U.S. cents
Preference shares, Series 7 27.5 cents
Preference shares, Series 9 27.5 cents
Preference shares, Series 11 27.5 cents
Preference shares, Series 13 27.5 cents
Preference shares, Series 15 27.5 cents
Preference shares, Series 17 32.188 cents
(1) The quarterly dividend amount of Series
B was reset to 21.34 cents from 25 cents on
June 1, 2017, due to reset on every fifth
anniversary thereafter.
(2) The quarterly dividend amount of Series
C was set at 18.6 cents on June 1, 2017, due
to reset on a quarterly basis thereafter.
(3) The quarterly dividend amount of Series
J was reset to 30.54 U.S. cents from 25
U.S. cents on June 1, 2017, due to reset on
every fifth anniversary thereafter.
We seek Safe Harbor.
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