Annual report pursuant to Section 13 and 15(d)

Net Income per Common Unit

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Net Income per Common Unit
 12 Months Ended
Dec. 31, 2023
Earnings Per Share [Abstract]  
Net Income per Common Unit NET INCOME PER COMMON UNIT
 
Net income per common unit for a given period is based on the distributions we incur to the common unitholders with respect to earnings or losses of the reporting period plus an allocation of undistributed net income (loss) based on provisions of the partnership agreement, divided by the weighted average number of common units outstanding. Distributions declared by us during the period are presented on the Consolidated Statements of Partners’ Equity (Deficit). On January 26, 2024, we declared a cash distribution of $1.035 per common unit to unitholders of record as of February 7, 2024 and the related general partner distribution that was paid on February 14, 2024 with respect to the three months ended December 31, 2023. These distributions consist of a base amount of $0.775 per unit and a variable amount of $0.260 per unit.

The two-class method dictates that net income for a period be reduced by the amount of available cash that will be distributed with respect to that period and that any residual amount representing undistributed net income be allocated to common unitholders and other participating unitholders to the extent that each unit may share in net income as if all of the net income for the period had been distributed in accordance with the partnership agreement. Undistributed income is allocated to participating securities based on the distribution waterfall for available cash specified in the partnership agreement. Undistributed losses (including those resulting from distributions in excess of net income) are allocated to common units and other participating securities on a pro rata basis based on provisions of the partnership agreement. Distributions are treated as distributed earnings in the computation of earnings per common unit even though cash distributions are not necessarily derived from current or prior period earnings.
The following table provides a reconciliation of net income and the allocation of net income to the common units, the subordinated units, the general partner units and IDRs for purposes of computing basic and diluted net income per unit (in millions, except per unit data).
  Total Limited Partner Common Units General Partner Units
IDR
Year Ended December 31, 2023
Net income $ 4,254 
Declared distributions 2,861  1,997  57  807 
Assumed allocation of undistributed net income (1) $ 1,393  1,366  28  — 
Assumed allocation of net income $ 3,363  $ 85  $ 807 
Weighted average units outstanding 484.0 
Basic and diluted net income per unit $ 6.95 
Year Ended December 31, 2022
Net income $ 2,498 
Declared distributions 2,982  2,057  60  865 
Assumed allocation of undistributed net loss (1) $ (484) (474) (10) — 
Assumed allocation of net income $ 1,583  $ 50  $ 865 
Weighted average units outstanding 484.0 
Basic and diluted net income per unit $ 3.27 
Year Ended December 31, 2021
Net income $ 1,630 
Declared distributions 1,486  1,309  30  147 
Assumed allocation of undistributed net income (1) $ 144  141  3  — 
Assumed allocation of net income $ 1,450  $ 33  $ 147 
Weighted average units outstanding 484.0 
Basic and diluted net income per unit (2) $ 3.00 
(1)Under our partnership agreement, the IDRs participate in net income only to the extent of the amount of cash distributions actually declared, thereby excluding the IDRs from participating in undistributed net income (loss).
(2)Basic and diluted net income per unit in the table may not recalculate exactly due to rounding because it is calculated based on whole numbers, not the rounded numbers presented.