Presentation on theme: "Enterprise’s Operating and Business Environment"— Presentation transcript:
1Enterprise’s Operating and Business Environment Special Emphasis on the U.S. Ethylene IndustryPeter FasulloEn*Vantage, IncMay 26, 2004
2Topics to be Covered 3 Study Scope ………...………………………………………. 4 - 5 Page(s)34 - 567 - 13Study Scope ………...……………………………………….Basic Approach & Focus Areas……………………Terminology …………………………………………………EPD’s & GTM’s Business Profile………………………..Industry Overview: Supply & Demand………………….Short & Long Term Market Outlook…………………….Sensitivity Cases………………………………..
3Study Scope – Study set out to answer: How sensitive is EPD’s profitability to:the business cycles of the US Ethylene Industry; and,to different price decks for crude oil and natural gas?Has EPD seen the Ethylene cycle trough and what is the outlook for the Industry?Will the merger with GulfTerra change EPD’s sensitivity to Ethylene cycles?Do long term market fundamentals favor EPD?
4Basic Approach & Focus Areas (1) Examined EPD’s business segments and interrelationships to assess EPD’s sensitivity to the US Ethylene Industry.Business SegmentBusiness FunctionsNatural GasStoragePipelinesPetrochemicalTerminal ServicesNGLProfiled each segment:Earnings ContributionProducts Handled & MarketsPrimary Business DriversNGLFractionationIsomerizationPropylene SplittingGas ProcessingProcessingNGL MarketingOctaneEnhancementMTBE
5Basic Approach & Focus Areas (2) Specifically focused on:The Effect of High Natural Gas Prices on:The U.S. Ethylene IndustryThe U.S. Gas Processing IndustryThe Economy and its influence on the U.S. Ethylene IndustryDeveloped short and long term industry outlooks, specifically for ethane.Evaluated EPD’s operating income sensitivity (with and without GTM) to changes in Ethylene Operating Environment and Commodity Prices.
6TerminologyY-Grade or Raw NGL Mix - are the raw NGLs (ethane, propane, butanes and natural gasoline) extracted from natural gas by a gas processing plant.Refinery Gas Liquids (RGLs) - are light hydrocarbons such as ethane, propane, normal and iso-butanes that are produced as the result of refining crude oil.Fractionation - the process by which individual NGL components are separated from raw NGL, LPG or RGL mixes.“Frac Spread” – is the term commonly used to express the price differential between the market value of the individual NGL component and its heating value if left in the natural gas stream. “Frac Spreads” are commonly expressed in cents per gallon (cpg) or dollars per million British Thermal Units ($/MM BTU).Propylene Splitting - the process of purifying propylene to polymer grade by fractionating out propane and other hydrocarbons from the propane/propylene mix.Isomerization – the process of changing normal butane to iso-butane..Primary Petrochemicals - mainly the production of ethylene and other olefin co-products (propylene, butylenes) from the “cracking” of NGLs and refinery intermediate products, such as naphtha and gas oil commonly referred to as heavy liquids. The “cracking” of hydrocarbon feedstocks is the thermal process by which Ethylene plants produce primary petrochemicals.
8EPD’s primary operating sector is along the NGL value chain EPD’s primary operating sector is along the NGL value chain. GulfTerra’s is weighted more to natural gas midstream services.DownstreamMidstreamNGL (raw mix)TransportationPurity ProductTransportationRefinedProductsUpstreamPrimaryPetrochem.Exploration &ProductionProcessing& TreatingFractionation &SplittingProductStorageFuel UsesIndustrialMarketsGasGatheringRes/ComMarketsGasTransportationLocal GasDistributionGasStorageThe U.S. Midstream Sector is the logistical link connecting the E&P, Gas, Refining and Petrochemical Industries.Independent PowerGenerationPowerDistributionPower Markets
9EPD asset base concentrated on Gulf Coast with linkage to the Western and Mid-Cont. producing regions via MAPL/Seminole.Third Party Pipelines
10Over 90% of EPD’s Business is expected to be generated from NGL and Petrochemical Midstream Services during 2004.
11GTM asset base highly concentrated in Texas and San Juan Basin with positions in the GOM. 15,700+ miles gas pipeline (10.3 Bcf/d)340+ miles offshore oil pipeline (635MBbl/d)5 Processing/treating plants (1.5Bcf/ 50MBbl/d)San JuanBasin4 NGL fractionation plants (120MBbl/d)San Juan20 Bcf gas storage; 25 MMBbl NGL storageBasinBlack WarriorBlack Warrior6 offshore hub platformsBasinBasinCARLSBADCARLSBADPETAL STORAGEPETAL STORAGEPermianPermianBasinBasinGas pipelineGas pipelineGas pipeline under constructionGas pipeline under constructionViosca KnollViosca KnollCameronCameronPoseidonPoseidonOil pipelineOil pipelineHIOSHIOSHighwayHighwayOil pipeline under constructionOil pipeline under constructionMedusaMedusaNGL pipelineNGL pipelineAlleghenyAlleghenyPlatformPlatformFalconFalconPlatform under constructionPlatform under constructionFalconFalconNestNestEastEastRedRedGas processing/treating plantGas processing/treating plantMarcoMarcoTEXAS NGLTEXAS NGLBreaksBreaksHawkHawkPoloPoloNGL fractionation plantNGL fractionation plantFACILITIESFACILITIESGas storage facilityGas storage facility
12GulfTerra Business Breakdown* During 2004, over 70% of GTM’s Business is expected to be Oil & Gas Midstream Services - only 28% generated from NGL Midstream Services.GulfTerra Business Breakdown*(Current Composition of Annualized EBITDA)Processing Plants: 20%NGL MidstreamServices: 28 %NGL Pipelines,Fractionation &Storage: 8%Oil & GasMidstream Services: 72%* Includes GulfTerra and 9 Gas Processing Plants to be Acquired from El Paso Corp.
13Expected Enterprise + GulfTerra Business Breakdown The Merger will diversify EPD’s business and provide more balance in Midstream Services for Both Companies.Expected Enterprise + GulfTerra Business BreakdownFor 2004Processing Plants: 16%Oil & GasNGLMidstream Services:Midstream37%Services:53%NGL Pipelines,Fractionation &Storage: 37%Propylene Splitting &Butane Isomerization: 10%Combination provides:Better balance between NGLs, Oil, andGas ServicesIntegration of FacilitiesBusiness Risk Mitigation*Does Not Include the $30 MM Cost Saving Synergiesor Commercial Synergies yet to be Quantified.
15To gain an appreciation of the fundamentals driving NGL supply, demand and pricing, an overview of the primary supply sources and market end uses will be provided.NGL Supply SourcesNGLs ProducedNGL End UsesNGLs ConsumedEthanePropaneNormal ButaneIso-ButaneNatural GasolineEthanePropaneNormal ButaneIso-ButaneNatural GasolineGas Processing & FractionationPrimaryPetrochemicals¹¹ Mainly Ethylene and other primary olefins produced in an Ethylene PlantNormal ButaneIso-ButaneNatural GasolineMotor Gasoline & BlendstocksEthanePropaneNormal ButaneIso-ButaneCrude Oil RefiningSpace Heating& Other Fuel UsesPropanePropaneMixed ButanesOverland & Waterborne ImportsPropaneMixed ButanesExports
16Two thirds of U.S. NGL Supply comes from Gas Processing; Ethylene Production accounts for 54% of NGL Demand.Primary
175-Year Average NGL/Ethane Regional Production from Processing US NGL Production from Gas Processing corresponds with the location of the largest natural gas reserves.5-Year Average NGL/Ethane Regional Production from Processing(MBPD )80% of US Gas Production is Processed590 processing plants BCFD capacity56% of plant capacity is cryogenic70 fractionators million BPD capacity85 % of Frac capacity at market centersTotal Processing NGLs: 1843 MBPDTotal Processing Ethane: 682 MBPD202/8011%/12%116/96%/1%54/203%/3%237/8513%/12%Rocky Mtn.207/9711%/14%Mid-Continent318/11117%/16%Texas Inland570/22231%/33%Texas Gulf CoastLouisiana Gulf CoastNew Mexico139/588%/9%Upper Midwest% of US NGL Production / % of US Ethane ProductionOther
18La Gulf Coast & Offshore Major Processing Regions are linked to NGL Market Centers by Specific Transportation Corridors.NGL Flow DiagramEdmonton/Ft. SaskatchewanWCSBTransportation corridors set the regional cost to transport NGLs to market centers.Over 90% of U.S. Ethylene Capacity on USGCAbout 50% of U.S. Refining Capacity on USGCThe regional value of gas sets the relative cost basis for NGLs at each regionSarniaRockyMountainsConwayAnadarkoSan JuanMajor Processing RegionsArkomaNGL Fractionation represents another cost component for NGLsRiverPermianNGL Market Centers(Storage, Fractionation,Pipelines)Mt.BelvieuLa Gulf Coast & OffshoreSouth TexasNGL Product Flows
19NGL production is primarily non-discretionary NGL production is primarily non-discretionary. However, ethane extraction from gas processing is discretionary and the most economically sensitive NGL component.NGL/RGLGas ProcessingCrude Oil RefiningEthaneDiscretionary 1By-productPropaneMostly Non-Discretionary 2N-ButaneNon-I-ButaneDiscretionary 2,3By-product/Discretionary 3Natural GasolinePentanes1 Average U.S. ethane yields can vary from 34% to 46% if economics dictate.If ethane extraction is minimized it only reduces total NGL volumes by 10% to 20%.2 Most propane & virtually all butane plus must be recovered to meet gas pipeline specs.3 Iso-Butane is a refinery by-product, but is also a discretionary product produced by theisomerization of normal butane from gas processing and refining.
20Petrochemical & Fuel Markets set U. S Petrochemical & Fuel Markets set U.S. NGL prices in competition with petroleum derived products. Natural Gas sets the relative cost for NGLs.GlobalOther EthyleneFeedstocks orFuelsEthylene Prod.Other Fuel Uses¹37%Other GasolineBlendstocksGasoline¹Isomerization63%N-ButaneFeedstocksCrude Blending46%Gasoline54%Nat’l Gaso.Petrochemicals41%AlkylateMTBE²59%I-ButaneNatural GasNo 2 Fuel OilSpace Heating¹EthaneNaphthaGas OilsEthyleneProductionPropaneNorth AmericaResidual FuelRetained in Natural Gas100%% of Demand:NGLSupplySourceCompetingProductsSecondaryMarket(s)Primary88% +/- 5%Other EthyleneFeedstocks orFuelsEthylene Prod.Other Fuel Uses¹37%Other GasolineBlendstocksGasoline¹Isomerization63%N-Butane% of Demand:97% +/- 4%FeedstocksCrude Blending46%Gasoline54%Nat’l Gaso91% +/- 4%Petrochemicals41%Gasoline Additives59%I-Butane75% +/- 8%Natural GasNo 2 Fuel OilSpace Heating¹EthaneNaphthaGas OilsEthyleneProductionPropane53% +/- 10%Residual FuelRetained in Natural Gas100%5-yr Avg. Price Ratio to Crude³CompetingProductsSecondaryMarket(s)PrimaryNGLGlobalOther EthyleneFeedstocks orFuelsEthylene Prod.Other Fuel Uses¹37%Other GasolineBlendstocksGasoline¹Isomerization63%N-ButaneFeedstocksCrude Blending46%Gasoline54%Nat’l Gaso.Petrochemicals41%AlkylateMTBE²59%I-ButaneNatural GasNo 2 Fuel OilSpace Heating¹EthaneNaphthaGas OilsEthyleneProductionPropaneNorth AmericaResidual FuelRetained in Natural Gas100%% of Demand:NGLSupplySourceCompetingProductsSecondaryMarket(s)Primary% of Demand:% of Demand:% of Demand:% of Demand:¹ Seasonal Market ² Being Phased Out ³ On a $/Bbl basis
21Therefore, the relative value of gas to crude plays an important role in driving U.S. NGL supply/demand, particularly for ethane.** Based on 5.8 MM BTU/Bbl
22NGL production from Gas Processing is inversely related to the gas to crude price ratio……
23…..because NGL frac spreads are inversely correlated to the gas to crude price ratio.
24Frac spread volatility has caused NGL production swings to be severe but temporary. Volume swings greatest for Ethane.Observations:Ethane production swings of 100 to 200 MBPD or about 15% to 30% of its average annual production have occurred due to rising and falling extraction economics and its economic attractiveness as an ethylene feedstock.Propane and Butane Plus production swings have not been as severe, but have often coincided with severe gas price spikes.Average annual production levels closer to maximum levels than minimum levels.Current estimated maximum NGL production from processing: Ethane – 760 MBPD; Propane MBPD; Butane Plus – 670 MBPD; Total NGLs – 2,000 MBPD
25Processing Agreements Are Being Retooled to Minimize Risks to Independent Processors which will moderate the effects of Frac Spread volatility on NGL production.High Risk to Processor LowKeepWholeMargin Sharing% of Liquids(POL)% of Proceeds(POP)Processing FeeProcessor keeps extracted NGLs as fee for processingMust purchase and return to producer merchantable gas to replace fuel & shrinkageProducer and processor share value delta between NGLs and gas, i.e.. 50%/50%.Processor paid a % of NGLs as processing fee.Producer keep their % of NGLs in kind or have processor sell NGLs and receive cash.Could have keep whole provisionsProcessor paid a % of NGLs & gas as processing feeProducer keep their % of NGLs & gas in kind or have processor sell NGLs & gas and receive cash.Producer pays processor a processing or conditioning fee.Fee is market base and could be POL or POP or cash.Low Risk to Producer High
26….This will have positive implications for Enterprise More stable NGL production at Enterprise’s gas processing plants.More stable NGL volumes through Enterprise’s transportation and fractionation systems.More emphasis on NGL storage to handle supply and demand imbalances.
28U.S. Ethylene Production & Operating Rates are Rebounding from the mid-year 2003 troughs.
292004 Ethylene Capacity Market Share Effective U.S. Ethylene Capacity is 61 Billion Lbs/Yr of whichthe Top 7 Ethylene Producers Control 80%.2004 Ethylene Capacity Market ShareEquistar …. 17.6%ExxonMobil1, %Dow …. 13.6%Chv Phillips1, %Shell1, %Formosa …. 5.4%BP1, %Huntsman …. 3.5%BASF/ATOFINA2 ……3.4%Others ….13.5%80%¹ Own & Operate Midstream Assets; ² Integrated with Refining Operations³ DuPont, Eastman Chemicals, Sasol NA, Sunoco, Westlake, Williams
30There are 4 Basic Types of Ethylene Plants that make-up the U. S There are 4 Basic Types of Ethylene Plants that make-up the U.S. Ethylene Industry.
31Product Yields for Ethylene Feedstocks For ethylene plants with feedstock flexibility, cracking one feedstock over another is dependent on feedstock cost and on the value of the co-products produced from each feedstock.Product Yields for Ethylene Feedstocks(Weight %)
32The flexibility to swing feedstocks is used to optimize olefin production & profits.
33Ethane extraction closely tracks ethane cracking influenced, in part, by the gas to crude price ratio.
34Short Term Market Outlook Demand and Supply Side
35Key Factors driving Ethylene Demand for NGLs, particularly for Ethane. Ethylene ProductionFeedstock DemandEthane DemandEffective Operating RateComposition of PlantsGas to Crude Price RatioGDP Growth
36Historical Relationship between GDP & Ethylene Demand is Changing Historical Relationship between GDP & Ethylene Demand is Changing. Expect 54 B Lb/yr production by 4th Qtr ‘04.Quarterly U.S. Ethylene Demand VS. GDPNew Trendline at 0.9 to 1.0 times GDP growthEthylene Demand - Billion PoundsB Lb/yr1560CMAITrendline GrowthForecast1456Q185 - Q4995213Ethylene demand grew at 1.25 to 1.4 times GDP growth rate12y = 1.99xQ148Q4R2= 0.97200020044411Annual Avg. Growth‘02 vs ‘01: 3.4%’03 vs ’02: (1.0%)’04 vs ’03: 4.5%4010Trendline broke down due to:RecessionHigh InventoriesHigh Energy CostsStrong U.S. DollarLoss of Derivative Exports369832Q11991728Q11985126.96.36.199.188.8.131.52.99.49.910.4GDP by Quarter - Trillion $ (Constant 1996$)Quarterly Ethylene Demand - CMAIGDP source - U.S. Dept. of Commerce
37Short Term Fundamentals continue to be positive for U. S Short Term Fundamentals continue to be positive for U.S. Ethylene Producers.U.S. and other major world ethylene markets appear strong.Tightening supply/demand balances1st quarter ‘04 effective utilization rate ~ 90% for U.S. ethylene producers with annualized production averaging over 53.5 billion lbs/yr.Despite $6 natural gas prices, rising crude prices have made ethane and propane cracking in U.S. very competitive on a global basis.U.S. exports of ethylene monomer and derivatives are starting to reappear.Evidence is building that fundamental recovery is sustainable.Last year, recovery lost momentum. This year, U.S. economy appears to be re-entering a period of strong growth.Major petrochemical companies are seeing purchases of their ethylene derivative products increasing and expect sustainability in 2004.Concerns – continued increases in crude prices and geopolitical uncertainties derail economic growth.
38Effective Utilization Ethane Cracking Levels As Ethylene production rebounds, analysis indicates the following implications for ethane demand which will be demonstrated on the next 2 charts:1. The flexibility to crack less ethane diminishes as ethylene production increases and ahigher range of ethane volumes are required to produce higher levels of ethylene.2. It appears that the U.S. Ethylene Industry can not stay at minimum ethane cracking levelsfor more than 1 Quarter without creating a surplus of ethylene co-products.3. While the level of ethylene production is the primary driver, the gas to crude price ratio isanother factor influencing ethane cracking levels. Lower ratios at or below 90% increasethe probability of maximizing ethane cracking.Ethylene ProductionEffective UtilizationEthane Cracking Levels(MBPD)(B Lb/Yr)(%)Min.Max.Flex. RangeTrendline495153555780.383.686.988.593.45105606106607106706907257401601301006530615644672700729
39As Ethylene Production Increases Past 53 Billion Lbs/Yr, Flexibility to Switch Off Ethane Diminishes.Max. Cracking LevelQ1 ’04Trendline:~12.7 X Ethyl Prod/YrMin.Cracking Level
40Minimum ethane cracking levels are not sustained more than 1 quarter without creating a surplus of ethylene co-products.Q1’00; 51%Q4’99; 61%Q3’00; 78%Q1’02; 63%Q3’99; 69%Q4’02; 82%Q4’00;96%Q3’02; 65%Q4’03; 94%Q2’00; 69%Q2’01; 97%Q1’03; 112%Q2’02; 75%Q2’99; 71%Q1 ’04; 92%Q1’99; 77%Q3’03; 96%Q1’01; 143%Quarter; Gas to Crude RatioQ2’03; 108%
41Gas Fundamentals should be weaker in ‘04 relative to Crude....
42.….resulting in a lower average Gas to Crude price ratio in ‘04
43See a better environment for ethane cracking in ‘04 and a paradigm shift could be underway if crude prices stay high.Ethane Cracking Swings Between MBPD Are Possible with a Bias to Maximize Ethane CrackingHigh Probability of Ethane Cracking Swings Between MBPD with a Bias to Minimize Ethane Cracking as long as Co-Product Production is Not an InhibitorAt B Lb/yr, Moderate to Good Probability of Ethane Cracking at or above 650 MBPD. Gas to Crude Ratio Less of a Factor at Production Rates above 55 B Lb/yrHigh Probability of Sustainable Ethane Cracking at or Above 650 MBPDAt or Below 90%Gas to Crude Price RatioAbove 90%Below 53 B LB/YRAbove 53 B LB/YREthylene Production
44To support greater ethane cracking levels, the ethane “frac” spread increases to encourage more ethane extraction.Below the curve ethane cracking occurred at gas to crude ratios generally above 90%
46Ethylene production should track GDP growth rate at a 0. 9 to 1 Ethylene production should track GDP growth rate at a 0.9 to 1.0 factor. Forecast ethane demand to be ~ 750 MBPD by ‘07.3² Federal ReserveForecast is 5%Production
47In the Lower-48, growth in Rockies and Deepwater GOM will offset declines in virtually all other U.S. mature basins.NPC Report 9/25/03
48U.S. NGL production should grow to accommodate production trends and market demands. Source: DOE, En*Vantage
49La GC and Rockies will be the incremental producers of ethane in the ’05 to ’10 time period. Source: DOE, En*Vantage
50Summary of Operating Conditions & Outlook Market conditions for NGLs should continue to improve in ’04.The ‘04 demand for ethane from processors is expected to be between 650 to 700 MBPD, an increase of 40 MBPD to 90 MBPD over ‘03 levels.Ethylene production rising to ~ 54 billion Lbs in ’04 as a result of U.S. GDP growth of 4.5%.Gas to crude price ratio remaining in the high 80% to low 90% range.NGL Production in 2004 increases from 2003 levels by about 8% or 130 MBPD.Longer term fundamentals are favorable for EPD.Incremental ethane supplies must be extracted from La GC and the Rockies to meet future demand for ethane.“Trough” conditions for ethane can occur when ethylene production levels are low (49 to 51 Billion Lbs/yr) and gas to crude ratios are well above 90%.During “trough” conditions ethylene producers usually minimize ethane cracking. However, minimum ethane cracking levels can not be sustained for more than 1 quarter without creating a surplus of co-products.When ethane extraction is minimized during “trough” conditions, ethane production can decrease 25% to 30% or about 200 MBPD from historical average extraction levels.Total NGL production, however, only drops 10% to 20% due to need to extract propane and butane plus to meet gas pipeline quality specifications.
52Sensitivity CasesBaseline Case – assumes “Project Miramar” price deck based on 2004 PIRA forecast and represents the recovery phase of the Ethylene Industry’s business cycle.Trough Case – annualizes mid-2003 market conditions reflecting ethylene cycle bottom, high relative price of natural gas, and minimum ethane cracking levels.Low Price Case – uses a low natural gas and crude price deck supplied by S&P.
53Combination Reduces EPD’s Sensitivity to Higher Natural Gas Prices in Trough Case. Trough conditions for an entire year, negatively impacts EPD’s operating income approx $53MM from its Baseline operating income.EPD’s Louisiana NGL assets and the MAPL/Seminole Pipeline, show the greatest sensitivity to an ethylene industry downturn due to reduced ethane volumes transported and fractionated. Recent changes in processing agreements help offset lower processing margins in Louisiana.Under “Trough Case”, GTM benefits from higher energy prices and its operating income increases by $25MM from its Baseline operating income.As a result, the combined operating income of EPD and GTM is only reduced by approx. $29MM.
54Combination Slightly Increases EPD’s Sensitivity to Lower Natural Gas Prices. The Low Price Case actually benefits EPD’s operating income marginally, due to the following factors:Lower energy prices benefit economic growth and ethane demand specifically.Higher volumes through EPD’s NGL systems and the amended Shell contract offset lower processing margins for EPD.GTM’s operating income decreases by approximately $39MM under the Low Price Case due to POP contracts (assuming no hedges are in place).As a result, the combined operating income of EPD and GTM is reduced by approximately $34MM under the low price case.w/o GTMw/ GTM
55Forward Looking Statements This study contains forward-looking statements and information that are based on Enterprise’s beliefs and those of its general partner as provided to En*Vantage, Inc., as well as assumptions made by and information currently available to Enterprise and En*Vantage, Inc.. When used in this presentation, words such as “anticipate,” “project,” “expect,” “plan,” “goal,” “forecast,” “intend,” “could,” “believe,” “may,” and similar expressions and statements regarding the contemplated transaction and the plans and objectives of Enterprise for future operations, are intended to identify forward-looking statements. Although Enterprise and its general partner believes that such expectations reflected in such forward looking statements are reasonable, neither it nor its general partner can give assurances that such expectations will prove to be correct.Such statements are subject to a variety of risks, uncertainties and assumptions. If one or more of these risks or uncertainties materialize, or if underlying assumptions prove incorrect, actual results may vary materially from those Enterprise and En*Vantage, Inc. anticipated, estimated, projected or expected. Among the key risk factors that may have a direct bearing on Enterprise’s results of operations and financial condition are:
56Forward Looking Statements (cont.) Fluctuations in oil, natural gas and NGL prices and production due to weather and other natural and economic forces;A reduction in demand for its products by the petrochemical, refining or heating industries;A decline in the volumes of NGL’s delivered by its facilities;The failure of its credit risk management efforts to adequately protect it against customer non-payment;Terrorist attacks aimed at its facilities;The failure to complete the proposed merger;The failure to successfully integrate the respective business operations upon completion of the merger or its failure to successfully integrate any future acquisitions; andThe failure to realize the anticipated cost savings, synergies and other benefits of the proposed merger.En*Vantage has no obligation to publicly update or revise any forward looking statement, whether as a result of new information, future events or otherwise. This presentation also includes Non-GAAP financial measures. Please refer to the reconciliations of GAAP financial statements to Non-GAAP financial measures included at the back of Enterprise’s presentation of May 26, 2004 as posted on their website