The bottleneck is inside and being paid away

EnLink Midstream, LLC (ENLC) — this company's answers

The model's full reasoning — Q4 2015 call → NOWe need to determine if management conveys that the main thing standing between the company and meaningfully more business right now is the company's own capability - capacity, people, facilities, throughput, or ability to deliver - rather than a shortage of demand, and that the company is already spending real money and effort to remove that internal limit, with the business waiting on the other side already visible today. We need to analyze the transcript. The question asks for YES or NO based on three conditions: 1) LIVE DEMAND PRESSING IN: real business exceeds or presses against what the company can currently produce/deliver/staff/install/serve, grounded in actual current behavior (waiting buyers, stretched lead times, allocated output, work queued) rather than pipeline or market opportunity. 2) THE LIMIT IS THE COMPANY'S OWN: management identifies its own capability, not customer hesitation, competition, macro softness, or purchased-input shortages alone, as the binding constraint. 3) REMOVAL ALREADY UNDERWAY: concrete expansion - building, hiring, commissioning, qualifying, adding shifts/sites, bringing in outside capability - is executing now or committed and in motion, not merely planned. We need to see if management says something like "we have more demand than we can handle, we are building capacity to meet it" etc. From the transcript, management talks about growth opportunities, capital expenditures on new plants, pipelines, etc. But do they say that they are constrained by their own capacity? Let's scan. They mention bringing on additional capacity at Cana plant to support Devon's production. They talk about expanding in Oklahoma, Permian, Louisiana. They talk about building new plants (Riptide, Lobo II). They talk about extending systems. They talk about reducing costs, etc. But do they say that demand is currently exceeding their capacity? They mention "we expect to spend approximately $180 million to $210 million of growth capital in Oklahoma in 2016 by extending our system south into the SCOOP play and consolidating the Cana and Tall Oak systems to optimize capacity utilization among our plant super-systems and minimize capital spending." That suggests they are optimizing, not necessarily that they are turning away business. They talk about "We see many opportunities to expand and grow." That's opportunity, not live demand pressing in.

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