Kinder Morgan Reports Third Quarter 2024 Financial Results
Final Investment Decision Reached for Gulf Coast Express Pipeline Expansion
Earnings per Share (EPS) up 17% Compared to Third Quarter 2023
Adjusted EPS flat to Third Quarter 2023
The company is reporting:
-
Third quarter earnings per share (EPS) of
$0.28 , up 17% compared to the third quarter of 2023, Adjusted EPS of$0.25 , flat to the third quarter of 2023 and distributable cash flow (DCF) per share of$0.49 , flat to the third quarter of 2023. -
Net income attributable to KMI of
$625 million , compared to$532 million in the third quarter of 2023. -
Adjusted EBITDA of
$1,880 million , up 2% from$1,835 million in the third quarter of 2023.
“With war continuing in
“As for our company, we enjoyed another solid quarter of strong operational and financial performance. We continued to internally fund high-quality capital projects while generating cash flow from operations of
“The company had a solid third quarter on increased financial contributions from our Natural Gas Pipelines and Terminals business segments, with Adjusted EBITDA up 2% versus the third quarter of 2023,” said Chief Executive Officer
“Further, KMI’s balance sheet remains very strong, as we ended the quarter with a Net Debt-to-Adjusted EBITDA ratio of 4.1 times,” continued Dang.
“We advanced a number of exciting projects during the quarter, including finalizing the investment decision with respect to a
“Discussions around opportunities related to significant new natural gas demand for electric generation associated with coal conversions at power plants, artificial intelligence operations, cryptocurrency mining, data centers and industrial re-shoring also continued during the quarter, and we now see an opportunity set well in excess of 5 Bcf/d in that area,” said Dang.
“Our project backlog at the end of the third quarter was
“We are devoting approximately 86% of our project backlog to lower-carbon energy investments, including 83% to conventional natural gas, and the remainder to renewable natural gas (RNG), renewable diesel (RD), feedstocks associated with RD and sustainable aviation fuel (SAF), as well as carbon capture and sequestration,” Dang concluded.
2024 Outlook
For 2024, including contributions from the acquired STX Midstream assets, KMI budgeted net income attributable to KMI of
The budget assumes average annual prices for West Texas Intermediate (WTI) crude oil and
“Due to lower than budgeted commodity prices and start-up delays on our RNG facilities, partially offset by higher contributions from natural gas transmission and storage, we now expect to be below budget on Adjusted EBITDA by approximately 2% and on Adjusted EPS by approximately 4%, although we expect Adjusted EBITDA to be up 5% and Adjusted EPS to be up 9% for the full year versus 2023. We expect to end the year with a Net Debt-to-Adjusted EBITDA ratio of 4.0 times,” said Dang.
This press release includes Adjusted Net Income Attributable to KMI and DCF, in each case in the aggregate and per share, Adjusted Segment EBDA, Adjusted EBITDA, Net Debt, FCF and Project EBITDA, all of which are non-GAAP financial measures. For descriptions of these non-GAAP financial measures and reconciliations to the most comparable measures prepared in accordance with generally accepted accounting principles, please see “Non-GAAP Financial Measures” and the tables accompanying our preliminary financial statements.
Overview of Business Segments
“The Natural Gas Pipelines business segment’s improved financial performance in the third quarter of 2024 relative to the third quarter of 2023 benefited from continued higher contributions from our Texas Intrastate system, additional contributions from our STX Midstream acquisition, and higher contributions from expansion projects on
“Natural gas transport volumes were up 2% compared to the third quarter of 2023. Natural gas gathering volumes were up 5% from the third quarter of 2023, primarily from our Haynesville and
“Contributions from the Products Pipelines business segment were down compared to the third quarter of 2023 largely due to lower commodity prices and the associated impact on inventory used to support our transmix and crude and condensate businesses. Total refined products volumes were up slightly, and crude and condensate volumes were down 4% compared to the third quarter of 2023,” Martin said.
“Terminals business segment earnings were up compared to the third quarter of 2023. Our liquids terminals benefited from expansion projects placed into service as well as higher rates and utilization at our
“CO2 business segment earnings were down compared to the third quarter of 2023 due to lower crude volumes, higher power costs, and the divestiture of certain assets earlier this year, partially offset by contributions from KMI’s
Other News
Corporate
-
In
July 2024 , KMI issued$500 million of 5.10% senior notes dueAugust 2029 and$750 million of 5.95% senior notes dueAugust 2054 to repay outstanding commercial paper and maturing debt and for general corporate purposes. The interest rates on the notes were favorable compared to budgeted rates.
Natural Gas Pipelines
-
On
August 30, 2024 ,Gulf Coast Express Pipeline LLC (GCX) reached a final investment decision (FID) to proceed with its approximately$455 million expansion project (approximately$161 million KM-share) after securing the necessary binding firm long term transportation agreements. The project is designed to increase natural gas deliveries by 570 MMcf/d from thePermian Basin toSouth Texas markets. Subject to all required approvals, the project is expected to be in service mid-2026. GCX is jointly owned by a subsidiary of KMI, an affiliate ofArcLight Capital Partners, LLC and a subsidiary of Phillips 66. KMI is the operator of GCX. -
Preliminary survey work is underway on the South System Expansion 4 (SSE4) Project designed to increase SNG’s South Line capacity by approximately 1.2 Bcf/d. Upon completion, the approximately
$3 billion project will help meet growing power generation and local distribution company demand in the Southeast markets. SSE4 will be almost entirely comprised of brownfield looping and horsepower compression additions on the SNG and Elba Express (EEC) pipeline systems (approximately$1.7 billion KM-share including EEC). Subject to all required approvals, KMI expects the project to be in service beginning in late 2028. -
Construction activities are ongoing for the Kinder Morgan Tejas Pipeline’s (Tejas) approximately
$154 million South Texas to Houston Market expansion project. The first phase of the project will add compression on Tejas’ mainline, with a target in-service date in the first quarter of 2025. Tejas has also executed the definitive agreements necessary to proceed with the second phase of the project which predominantly involves 14 miles of pipeline looping. The expected in-service date for this portion of the project is the third quarter of 2025. Together these projects will provide approximately 500 MMcf/d to key markets. -
The Webb County Extension project, an approximately
$158 million expansion of the Kinder Morgan Texas Pipeline (KMTP) system, was placed in service onOctober 1, 2024 . The project provides additional treating and transport opportunities for lean natural gasEagle Ford producers inWebb County . The project, supported by a long-term contract, delivers up to 400 MMcf/d ofEagle Ford natural gas supply into the company’s Texas Intrastate network. -
Construction is ongoing for the second phase of the approximately
$670 million Evangeline Pass project, which has an expected in-service date ofJuly 1, 2025 . The two-phase project involves modifications and enhancements to portions of theTGP andSouthern Natural Gas (SNG) systems inMississippi andLouisiana , resulting in the delivery of approximately 2 Bcf/d of natural gas to Venture Global’s Plaquemines LNG facility. The approximately$283 million first phase of the project providing 900 mDth/d of capacity was placed in serviceJuly 1, 2024 . -
NGPL has executed the definitive agreements necessary to proceed with its approximately
$94 million Gulf Coast Storage Expansion project (approximately$35 million KM-share). This project will provide approximately 10 Bcf of incremental natural gas storage capacity on NGPL’s high-growthGulf Coast system. Subject to all required approvals, NGPL expects the project to be placed in service in the first half of 2027.
Terminals
-
Construction is nearing completion on KMI’s latest expansion of its industry-leading RD and SAF feedstock storage and logistics offering at its lower
Mississippi River hub. The scope of work at itsGeismar River Terminal inGeismar, Louisiana includes construction of multiple tanks totaling approximately 250,000 barrels of heated storage capacity as well as various marine, rail and pipeline infrastructure improvements. The approximately$54 million Geismar River Terminal project is supported by a long-term commercial commitment and is expected to be in service by the fourth quarter of 2024.
Products
-
During the quarter, KMI’s SFPP pipeline secured necessary customer commitments in a binding open season to add 2,500 barrels per day of additional capacity on its East Line system for transportation of refined petroleum products from
El Paso, Texas toTucson, Arizona . SFPP has the ability to further expand its East Line system toTucson without installing additional pipe should customers need additional capacity. The target in-service date is the third quarter of 2025.
-
Construction is substantially complete on the Autumn Hills RNG facility, and it is expected to be placed into service
December 2024 with an expected capacity of 0.8 Bcf of RNG annually. Once complete and in service, this additional facility will bring KMI’s total RNG generation capacity to 6.9 Bcf per year.
Please join
Non-GAAP Financial Measures
As described in further detail below, our management evaluates our performance primarily using Net income attributable to
Our non-GAAP financial measures described below should not be considered alternatives to GAAP net income attributable to
Certain Items, as adjustments used to calculate our non-GAAP financial measures, are items that are required by GAAP to be reflected in net income attributable to
The following table summarizes our Certain Items for the three and nine months ended
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
(In millions) |
||||||||||||||
Certain Items |
|
|
|
|
|
|
|
||||||||
Change in fair value of derivative contracts (1) |
|
(20 |
) |
|
|
37 |
|
|
|
32 |
|
|
|
(93 |
) |
(Gain) loss on divestitures and impairment, net |
|
— |
|
|
|
— |
|
|
|
(70 |
) |
|
|
67 |
|
Income tax Certain Items (2) |
|
(49 |
) |
|
|
(7 |
) |
|
|
(48 |
) |
|
|
6 |
|
Other |
|
1 |
|
|
|
— |
|
|
|
3 |
|
|
|
— |
|
Total Certain Items (3)(4) |
$ |
(68 |
) |
|
$ |
30 |
|
|
$ |
(83 |
) |
|
$ |
(20 |
) |
Notes |
|
(1) |
Gains or losses are reflected when realized. |
(2) |
Represents the income tax provision on Certain Items plus discrete income tax items. Includes the impact of KMI’s income tax provision on Certain Items affecting earnings from equity investments and is separate from the related tax provision recognized at the investees by the joint ventures which are also taxable entities. |
(3) |
Amounts for the periods ending |
(4) |
Amounts for the periods ending |
Adjusted Net Income Attributable to
Adjusted Net Income Attributable to Common Stock and Adjusted EPS is calculated by adjusting Net income attributable to
DCF is calculated by adjusting net income attributable to
Adjusted Segment EBDA is calculated by adjusting segment earnings before DD&A and amortization of excess cost of equity investments, general and administrative expenses and corporate charges, interest expense, and income taxes (Segment EBDA) for Certain Items attributable to the segment. Adjusted Segment EBDA is used by management in its analysis of segment performance and management of our business. We believe Adjusted Segment EBDA is a useful performance metric because it provides management, investors and other external users of our financial statements additional insight into performance trends across our business segments, our segments’ relative contributions to our consolidated performance and the ability of our segments to generate earnings on an ongoing basis. Adjusted Segment EBDA is also used as a factor in determining compensation under our annual incentive compensation program for our business segment presidents and other business segment employees. We believe it is useful to investors because it is a measure that management uses to allocate resources to our segments and assess each segment’s performance. (See the accompanying Table 4.)
Adjusted EBITDA is calculated by adjusting net income attributable to
Amounts from Joint Ventures - Certain Items, DCF and Adjusted EBITDA reflect amounts from unconsolidated joint ventures (JVs) and consolidated JVs utilizing the same recognition and measurement methods used to record “Earnings from equity investments” and “Noncontrolling interests (NCI),” respectively. The calculations of DCF and Adjusted EBITDA related to our unconsolidated and consolidated JVs include the same items (DD&A and income tax expense, and for DCF only, also cash taxes and sustaining capital expenditures) with respect to the JVs as those included in the calculations of DCF and Adjusted EBITDA for our wholly-owned consolidated subsidiaries; further, we remove the portion of these adjustments attributable to non-controlling interests. (See Tables 2, 3, and 6.) Although these amounts related to our unconsolidated JVs are included in the calculations of DCF and Adjusted EBITDA, such inclusion should not be understood to imply that we have control over the operations and resulting revenues, expenses or cash flows of such unconsolidated JVs.
Net Debt is calculated by subtracting from debt (1) cash and cash equivalents, (2) debt fair value adjustments, and (3) the foreign exchange impact on Euro-denominated bonds for which we have entered into currency swaps to convert that debt to
Project EBITDA is calculated for an individual capital project as earnings before interest expense, taxes, DD&A and general and administrative expenses attributable to such project, or for JV projects, consistent with the methods described above under “Amounts from
FCF is calculated by reducing cash flow from operations for capital expenditures (sustaining and expansion), and FCF after dividends is calculated by further reducing FCF for dividends paid during the period. FCF is used by management, investors and other external users as an additional leverage metric, and FCF after dividends provides additional insight into cash flow generation. Therefore, we believe FCF is useful to our investors. We believe the GAAP measure most directly comparable to FCF is cash flow from operations. (See the accompanying Table 7.)
Important Information Relating to Forward-Looking Statements
This news release includes forward-looking statements within the meaning of the
Table 1 |
|||||||||||||||||||||
|
|||||||||||||||||||||
Preliminary Consolidated Statements of Income |
|||||||||||||||||||||
(In millions, except per share amounts, unaudited) |
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Three Months Ended
|
|
% change |
|
Nine Months Ended
|
|
% change |
||||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
|
2024 |
|
|
|
2023 |
|
|
||||
Revenues |
$ |
3,699 |
|
|
$ |
3,907 |
|
|
|
|
$ |
11,113 |
|
|
$ |
11,296 |
|
|
|
||
Operating costs, expenses and other |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Costs of sales (exclusive of items shown separately below) |
|
1,024 |
|
|
|
1,405 |
|
|
|
|
|
3,098 |
|
|
|
3,591 |
|
|
|
||
Operations and maintenance |
|
790 |
|
|
|
738 |
|
|
|
|
|
2,211 |
|
|
|
2,062 |
|
|
|
||
Depreciation, depletion and amortization |
|
587 |
|
|
|
561 |
|
|
|
|
|
1,758 |
|
|
|
1,683 |
|
|
|
||
General and administrative |
|
176 |
|
|
|
162 |
|
|
|
|
|
530 |
|
|
|
497 |
|
|
|
||
Taxes, other than income taxes |
|
107 |
|
|
|
106 |
|
|
|
|
|
327 |
|
|
|
319 |
|
|
|
||
Loss (gain) on divestitures, net |
|
1 |
|
|
|
(3 |
) |
|
|
|
|
(76 |
) |
|
|
(16 |
) |
|
|
||
Other income, net |
|
(1 |
) |
|
|
— |
|
|
|
|
|
(11 |
) |
|
|
(2 |
) |
|
|
||
Total operating costs, expenses and other |
|
2,684 |
|
|
|
2,969 |
|
|
|
|
|
7,837 |
|
|
|
8,134 |
|
|
|
||
Operating income |
|
1,015 |
|
|
|
938 |
|
|
|
|
|
3,276 |
|
|
|
3,162 |
|
|
|
||
Other income (expense) |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings from equity investments |
|
211 |
|
|
|
234 |
|
|
|
|
|
662 |
|
|
|
607 |
|
|
|
||
Amortization of excess cost of equity investments |
|
(12 |
) |
|
|
(18 |
) |
|
|
|
|
(37 |
) |
|
|
(54 |
) |
|
|
||
Interest, net |
|
(466 |
) |
|
|
(457 |
) |
|
|
|
|
(1,402 |
) |
|
|
(1,345 |
) |
|
|
||
Other, net |
|
16 |
|
|
|
3 |
|
|
|
|
|
17 |
|
|
|
7 |
|
|
|
||
Income before income taxes |
|
764 |
|
|
|
700 |
|
|
|
|
|
2,516 |
|
|
|
2,377 |
|
|
|
||
Income tax expense |
|
(113 |
) |
|
|
(145 |
) |
|
|
|
|
(490 |
) |
|
|
(509 |
) |
|
|
||
Net income |
|
651 |
|
|
|
555 |
|
|
|
|
|
2,026 |
|
|
|
1,868 |
|
|
|
||
Net income attributable to NCI |
|
(26 |
) |
|
|
(23 |
) |
|
|
|
|
(80 |
) |
|
|
(71 |
) |
|
|
||
Net income attributable to |
$ |
625 |
|
|
$ |
532 |
|
|
|
|
$ |
1,946 |
|
|
$ |
1,797 |
|
|
|
||
Class |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic and diluted earnings per share |
$ |
0.28 |
|
|
$ |
0.24 |
|
|
17 |
% |
|
$ |
0.87 |
|
|
$ |
0.80 |
|
|
9 |
% |
Basic and diluted weighted average shares outstanding |
|
2,221 |
|
|
|
2,230 |
|
|
— |
% |
|
|
2,220 |
|
|
|
2,238 |
|
|
(1 |
)% |
Declared dividends per share |
$ |
0.2875 |
|
|
$ |
0.2825 |
|
|
2 |
% |
|
$ |
0.8625 |
|
|
$ |
0.8475 |
|
|
2 |
% |
Adjusted Net Income Attributable to |
$ |
557 |
|
|
$ |
562 |
|
|
(1 |
)% |
|
$ |
1,863 |
|
|
$ |
1,777 |
|
|
5 |
% |
Adjusted EPS (1) |
$ |
0.25 |
|
|
$ |
0.25 |
|
|
— |
% |
|
$ |
0.83 |
|
|
$ |
0.79 |
|
|
5 |
% |
Notes |
|
(1) |
Adjusted Net Income Attributable to |
Table 2 |
|||||||||||||||||||||
|
|||||||||||||||||||||
Preliminary Net Income Attributable to |
|||||||||||||||||||||
(In millions, except per share amounts, unaudited) |
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Three Months Ended
|
|
% change |
|
Nine Months Ended
|
|
% change |
||||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
|
2024 |
|
|
|
2023 |
|
|
||||
Net income attributable to |
$ |
625 |
|
|
$ |
532 |
|
|
17 |
% |
|
$ |
1,946 |
|
|
$ |
1,797 |
|
|
8 |
% |
Certain Items (1) |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Change in fair value of derivative contracts |
|
(20 |
) |
|
|
37 |
|
|
|
|
|
32 |
|
|
|
(93 |
) |
|
|
||
(Gain) loss on divestitures and impairment, net |
|
— |
|
|
|
— |
|
|
|
|
|
(70 |
) |
|
|
67 |
|
|
|
||
Income tax Certain Items |
|
(49 |
) |
|
|
(7 |
) |
|
|
|
|
(48 |
) |
|
|
6 |
|
|
|
||
Other |
|
1 |
|
|
|
— |
|
|
|
|
|
3 |
|
|
|
— |
|
|
|
||
Total Certain Items |
|
(68 |
) |
|
|
30 |
|
|
(327 |
)% |
|
|
(83 |
) |
|
|
(20 |
) |
|
(315 |
)% |
Adjusted Net Income Attributable to |
$ |
557 |
|
|
$ |
562 |
|
|
(1 |
)% |
|
$ |
1,863 |
|
|
$ |
1,777 |
|
|
5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income attributable to |
$ |
625 |
|
|
$ |
532 |
|
|
17 |
% |
|
$ |
1,946 |
|
|
$ |
1,797 |
|
|
8 |
% |
Total Certain Items (2) |
|
(68 |
) |
|
|
30 |
|
|
|
|
|
(83 |
) |
|
|
(20 |
) |
|
|
||
Net income allocated to participating securities (3) |
|
(4 |
) |
|
|
(4 |
) |
|
|
|
|
(11 |
) |
|
|
(11 |
) |
|
|
||
Other (4) |
|
— |
|
|
|
(1 |
) |
|
|
|
|
1 |
|
|
|
— |
|
|
|
||
Adjusted Net Income Attributable to Common Stock |
$ |
553 |
|
|
$ |
557 |
|
|
(1 |
)% |
|
$ |
1,853 |
|
|
$ |
1,766 |
|
|
5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income attributable to |
$ |
625 |
|
|
$ |
532 |
|
|
17 |
% |
|
$ |
1,946 |
|
|
$ |
1,797 |
|
|
8 |
% |
Total Certain Items (2) |
|
(68 |
) |
|
|
30 |
|
|
(327 |
)% |
|
|
(83 |
) |
|
|
(20 |
) |
|
(315 |
)% |
DD&A |
|
587 |
|
|
|
561 |
|
|
|
|
|
1,758 |
|
|
|
1,683 |
|
|
|
||
Amortization of excess cost of equity investments |
|
12 |
|
|
|
18 |
|
|
|
|
|
37 |
|
|
|
54 |
|
|
|
||
Income tax expense (5) |
|
162 |
|
|
|
152 |
|
|
|
|
|
538 |
|
|
|
503 |
|
|
|
||
Cash taxes |
|
(14 |
) |
|
|
(1 |
) |
|
|
|
|
(25 |
) |
|
|
(10 |
) |
|
|
||
Sustaining capital expenditures (6) |
|
(270 |
) |
|
|
(242 |
) |
|
|
|
|
(680 |
) |
|
|
(593 |
) |
|
|
||
Amounts from joint ventures |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Unconsolidated JV DD&A |
|
99 |
|
|
|
80 |
|
|
|
|
|
271 |
|
|
|
241 |
|
|
|
||
Remove consolidated JV partners' DD&A |
|
(16 |
) |
|
|
(16 |
) |
|
|
|
|
(47 |
) |
|
|
(47 |
) |
|
|
||
Unconsolidated JV income tax expense (7)(8) |
|
17 |
|
|
|
24 |
|
|
|
|
|
58 |
|
|
|
70 |
|
|
|
||
Unconsolidated JV cash taxes (7) |
|
(6 |
) |
|
|
(21 |
) |
|
|
|
|
(59 |
) |
|
|
(73 |
) |
|
|
||
Unconsolidated JV sustaining capital expenditures |
|
(43 |
) |
|
|
(43 |
) |
|
|
|
|
(132 |
) |
|
|
(118 |
) |
|
|
||
Remove consolidated JV partners' sustaining capital expenditures |
|
2 |
|
|
|
2 |
|
|
|
|
|
7 |
|
|
|
6 |
|
|
|
||
Other items (9) |
|
9 |
|
|
|
18 |
|
|
|
|
|
29 |
|
|
|
51 |
|
|
|
||
DCF |
$ |
1,096 |
|
|
$ |
1,094 |
|
|
— |
% |
|
$ |
3,618 |
|
|
$ |
3,544 |
|
|
2 |
% |
Weighted average shares outstanding for dividends (10) |
|
2,235 |
|
|
|
2,244 |
|
|
|
|
|
2,233 |
|
|
|
2,251 |
|
|
|
||
DCF per share |
$ |
0.49 |
|
|
$ |
0.49 |
|
|
— |
% |
|
$ |
1.62 |
|
|
$ |
1.57 |
|
|
3 |
% |
Declared dividends per share |
$ |
0.2875 |
|
|
$ |
0.2825 |
|
|
|
|
$ |
0.8625 |
|
|
$ |
0.8475 |
|
|
|
Notes |
|
(1) |
See table included in “Non-GAAP Financial Measures—Certain Items.” |
(2) |
For a detailed listing, see the above reconciliation of Net Income Attributable to |
(3) |
Net income allocated to common stock and participating securities is based on the amount of dividends paid in the current period plus an allocation of the undistributed earnings or excess distributions over earnings to the extent that each security participates in earnings or excess distributions over earnings, as applicable. |
(4) |
Adjusted net income in excess of distributions for participating securities. |
(5) |
To avoid duplication, adjustments for income tax expense for the periods ended |
(6) |
Net of a |
(7) |
Associated with our Citrus, NGPL and Products (SE) Pipe Line equity investments. |
(8) |
Includes the tax provision on Certain Items recognized by the investees that are taxable entities. The impact of KMI’s income tax provision on Certain Items affecting earnings from equity investments is included within “Certain Items” above. See table included in “Non-GAAP Financial Measures—Certain Items.” |
(9) |
Includes non-cash pension expense, non-cash compensation associated with our restricted stock program and pension contributions. |
(10) |
Includes restricted stock awards that participate in dividends. |
Table 3 |
|||||||||||||||||||||
|
|||||||||||||||||||||
Preliminary Net Income Attributable to |
|||||||||||||||||||||
(In millions, unaudited) |
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Three Months Ended
|
|
% change |
|
Nine Months Ended
|
|
% change |
||||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
|
2024 |
|
|
|
2023 |
|
|
||||
Net income attributable to |
$ |
625 |
|
|
$ |
532 |
|
|
17 |
% |
|
$ |
1,946 |
|
|
$ |
1,797 |
|
|
8 |
% |
Certain Items (1) |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Change in fair value of derivative contracts |
|
(20 |
) |
|
|
37 |
|
|
|
|
|
32 |
|
|
|
(93 |
) |
|
|
||
(Gain) loss on divestitures and impairment, net |
|
— |
|
|
|
— |
|
|
|
|
|
(70 |
) |
|
|
67 |
|
|
|
||
Income tax Certain Items |
|
(49 |
) |
|
|
(7 |
) |
|
|
|
|
(48 |
) |
|
|
6 |
|
|
|
||
Other |
|
1 |
|
|
|
— |
|
|
|
|
|
3 |
|
|
|
— |
|
|
|
||
Total Certain Items |
|
(68 |
) |
|
|
30 |
|
|
|
|
|
(83 |
) |
|
|
(20 |
) |
|
|
||
DD&A |
|
587 |
|
|
|
561 |
|
|
|
|
|
1,758 |
|
|
|
1,683 |
|
|
|
||
Amortization of excess cost of equity investments |
|
12 |
|
|
|
18 |
|
|
|
|
|
37 |
|
|
|
54 |
|
|
|
||
Income tax expense (2) |
|
162 |
|
|
|
152 |
|
|
|
|
|
538 |
|
|
|
503 |
|
|
|
||
Interest, net (3) |
|
462 |
|
|
|
454 |
|
|
|
|
|
1,397 |
|
|
|
1,355 |
|
|
|
||
Amounts from joint ventures |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Unconsolidated JV DD&A |
|
99 |
|
|
|
80 |
|
|
|
|
|
271 |
|
|
|
241 |
|
|
|
||
Remove consolidated JV partners' DD&A |
|
(16 |
) |
|
|
(16 |
) |
|
|
|
|
(47 |
) |
|
|
(47 |
) |
|
|
||
Unconsolidated JV income tax expense (4) |
|
17 |
|
|
|
24 |
|
|
|
|
|
58 |
|
|
|
70 |
|
|
|
||
Adjusted EBITDA |
$ |
1,880 |
|
|
$ |
1,835 |
|
|
2 |
% |
|
$ |
5,875 |
|
|
$ |
5,636 |
|
|
4 |
% |
Notes |
|
(1) |
See table included in “Non-GAAP Financial Measures—Certain Items.” |
(2) |
To avoid duplication, adjustments for income tax expense for the periods ended |
(3) |
To avoid duplication, adjustments for interest, net for the periods ended |
(4) |
Includes the tax provision on Certain Items recognized by the investees that are taxable entities associated with our Citrus, NGPL and Products (SE) Pipe Line equity investments. The impact of KMI’s income tax provision on Certain Items affecting earnings from equity investments is included within “Certain Items” above. |
Table 4 |
||||||||||||||
|
||||||||||||||
Preliminary Reconciliation of Segment EBDA to Adjusted Segment EBDA |
||||||||||||||
(In millions, unaudited) |
||||||||||||||
|
|
|
|
|
|
|
|
|||||||
|
Three Months Ended
|
|
Nine Months Ended
|
|||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
2024 |
|
|
|
2023 |
|
Segment EBDA (1) |
|
|
|
|
|
|
|
|||||||
Natural Gas Pipelines Segment EBDA |
$ |
1,294 |
|
|
$ |
1,179 |
|
$ |
4,035 |
|
|
$ |
3,929 |
|
Certain Items (2) |
|
|
|
|
|
|
|
|||||||
Change in fair value of derivative contracts |
|
(14 |
) |
|
|
20 |
|
|
29 |
|
|
|
(99 |
) |
Gain on divestiture |
|
— |
|
|
|
— |
|
|
(29 |
) |
|
|
— |
|
Natural Gas Pipelines Adjusted Segment EBDA |
$ |
1,280 |
|
|
$ |
1,199 |
|
$ |
4,035 |
|
|
$ |
3,830 |
|
|
|
|
|
|
|
|
|
|||||||
Products Pipelines Segment EBDA |
$ |
278 |
|
|
$ |
311 |
|
$ |
871 |
|
|
$ |
780 |
|
Certain Items (2) |
|
|
|
|
|
|
|
|||||||
Change in fair value of derivative contracts |
|
(1 |
) |
|
|
2 |
|
|
— |
|
|
|
3 |
|
Loss on impairment |
|
— |
|
|
|
— |
|
|
— |
|
|
|
67 |
|
Products Pipelines Adjusted Segment EBDA |
$ |
277 |
|
|
$ |
313 |
|
$ |
871 |
|
|
$ |
850 |
|
|
|
|
|
|
|
|
|
|||||||
Terminals Segment EBDA |
$ |
268 |
|
|
$ |
259 |
|
$ |
818 |
|
|
$ |
774 |
|
Certain Items (2) |
|
|
|
|
|
|
|
|||||||
Change in fair value of derivative contracts |
|
(1 |
) |
|
|
— |
|
|
(1 |
) |
|
|
— |
|
Terminals Adjusted Segment EBDA |
$ |
267 |
|
|
$ |
259 |
|
$ |
817 |
|
|
$ |
774 |
|
|
|
|
|
|
|
|
|
|||||||
CO2 Segment EBDA |
$ |
170 |
|
|
$ |
163 |
|
$ |
534 |
|
|
$ |
510 |
|
Certain Items (2) |
|
|
|
|
|
|
|
|||||||
Change in fair value of derivative contracts |
|
(8 |
) |
|
|
12 |
|
|
(1 |
) |
|
|
13 |
|
Gain on divestitures |
|
— |
|
|
|
— |
|
|
(41 |
) |
|
|
— |
|
CO2 Adjusted Segment EBDA |
$ |
162 |
|
|
$ |
175 |
|
$ |
492 |
|
|
$ |
523 |
|
Notes |
|
(1) |
Includes revenues, earnings from equity investments, operating expenses, (loss) gain on divestitures, net, other income, net, and other, net. Operating expenses include costs of sales, operations and maintenance expenses, and taxes, other than income taxes. The composition of Segment EBDA is not addressed nor prescribed by generally accepted accounting principles. |
(2) |
See “Non-GAAP Financial Measures—Certain Items.” |
Table 5 |
|||||||||||||||
Segment Volume and CO2 Segment Hedges Highlights |
|||||||||||||||
(Historical data is pro forma for acquired and divested assets, JV volumes at KMI share (1)) |
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Natural Gas Pipelines |
|
|
|
|
|
|
|
||||||||
Transport volumes (BBtu/d) |
|
44,824 |
|
|
|
43,937 |
|
|
|
44,161 |
|
|
|
43,933 |
|
Sales volumes (BBtu/d) |
|
2,656 |
|
|
|
2,574 |
|
|
|
2,559 |
|
|
|
2,306 |
|
Gathering volumes (BBtu/d) |
|
3,825 |
|
|
|
3,637 |
|
|
|
3,950 |
|
|
|
3,566 |
|
NGLs (MBbl/d) |
|
34 |
|
|
|
35 |
|
|
|
38 |
|
|
|
34 |
|
Products Pipelines (MBbl/d) |
|
|
|
|
|
|
|
||||||||
Gasoline (2) |
|
1,003 |
|
|
|
1,002 |
|
|
|
978 |
|
|
|
985 |
|
Diesel fuel |
|
376 |
|
|
|
362 |
|
|
|
357 |
|
|
|
349 |
|
Jet fuel |
|
297 |
|
|
|
292 |
|
|
|
293 |
|
|
|
285 |
|
Total refined product volumes |
|
1,676 |
|
|
|
1,656 |
|
|
|
1,628 |
|
|
|
1,619 |
|
Crude and condensate |
|
472 |
|
|
|
490 |
|
|
|
474 |
|
|
|
481 |
|
Total delivery volumes (MBbl/d) |
|
2,148 |
|
|
|
2,146 |
|
|
|
2,102 |
|
|
|
2,100 |
|
Terminals |
|
|
|
|
|
|
|
||||||||
Liquids leasable capacity (MMBbl) |
|
78.6 |
|
|
|
78.7 |
|
|
|
78.6 |
|
|
|
78.7 |
|
Liquids leased capacity % |
|
94.9 |
% |
|
|
94.6 |
% |
|
|
94.3 |
% |
|
|
93.6 |
% |
Bulk transload tonnage (MMtons) |
|
13.4 |
|
|
|
12.6 |
|
|
|
41.1 |
|
|
|
39.7 |
|
CO2 |
|
|
|
|
|
|
|
||||||||
SACROC oil production |
|
19.02 |
|
|
|
19.94 |
|
|
|
19.01 |
|
|
|
20.49 |
|
Yates oil production |
|
5.90 |
|
|
|
6.66 |
|
|
|
6.08 |
|
|
|
6.65 |
|
Other |
|
1.00 |
|
|
|
1.07 |
|
|
|
1.04 |
|
|
|
1.08 |
|
Total oil production - net (MBbl/d) (3) |
|
25.92 |
|
|
|
27.67 |
|
|
|
26.13 |
|
|
|
28.22 |
|
NGL sales volumes - net (MBbl/d) (3) |
|
8.69 |
|
|
|
8.98 |
|
|
|
8.51 |
|
|
|
8.93 |
|
CO2 sales volumes - net (Bcf/d) |
|
0.319 |
|
|
|
0.311 |
|
|
|
0.323 |
|
|
|
0.338 |
|
RNG sales volumes (BBtu/d) |
|
6 |
|
|
|
5 |
|
|
|
7 |
|
|
|
5 |
|
Realized weighted average oil price ($ per Bbl) |
$ |
68.42 |
|
|
$ |
67.60 |
|
|
$ |
68.86 |
|
|
$ |
67.49 |
|
Realized weighted average NGL price ($ per Bbl) |
$ |
32.38 |
|
|
$ |
30.74 |
|
|
$ |
29.36 |
|
|
$ |
31.87 |
|
CO2 Segment Hedges |
Remaining 2024 |
|
2025 |
|
2026 |
|
2027 |
|
2028 |
||||||||||
Crude Oil (4) |
|
|
|
|
|
|
|
|
|
||||||||||
Price ($ per Bbl) |
$ |
66.38 |
|
$ |
65.86 |
|
$ |
65.88 |
|
$ |
65.71 |
|
$ |
64.45 |
|||||
Volume (MBbl/d) |
|
23.40 |
|
|
17.50 |
|
|
12.20 |
|
|
8.10 |
|
|
2.50 |
|||||
NGLs |
|
|
|
|
|
|
|
|
|
||||||||||
Price ($ per Bbl) |
$ |
48.60 |
|
$ |
48.99 |
|
|
|
|
|
|
||||||||
Volume (MBbl/d) |
|
5.08 |
|
|
1.87 |
|
|
|
|
|
|
Notes |
|
(1) |
Volumes for acquired assets are included for all periods. However, EBDA contributions from acquisitions are included only for periods subsequent to their acquisition. Volumes for assets divested, idled and/or held for sale are excluded for all periods presented. |
(2) |
Gasoline volumes include ethanol pipeline volumes. |
(3) |
Net of royalties and outside working interests. |
(4) |
Includes West Texas Intermediate hedges. |
Table 6 (continued) |
|||||||
|
|||||||
Preliminary Consolidated Balance Sheets |
|||||||
(In millions, unaudited) |
|||||||
|
|
|
|
||||
|
|
|
|
||||
|
|
2024 |
|
|
|
2023 |
|
Assets |
|
|
|
||||
Cash and cash equivalents |
$ |
108 |
|
|
$ |
83 |
|
Other current assets |
|
2,069 |
|
|
|
2,459 |
|
Property, plant and equipment, net |
|
37,709 |
|
|
|
37,297 |
|
Investments |
|
7,882 |
|
|
|
7,874 |
|
|
|
20,084 |
|
|
|
20,121 |
|
Deferred charges and other assets |
|
3,027 |
|
|
|
3,186 |
|
Total assets |
$ |
70,879 |
|
|
$ |
71,020 |
|
Liabilities and Stockholders' Equity |
|
|
|
||||
Short-term debt |
$ |
1,984 |
|
|
$ |
4,049 |
|
Other current liabilities |
|
2,747 |
|
|
|
3,172 |
|
Long-term debt |
|
29,825 |
|
|
|
27,880 |
|
Debt fair value adjustments |
|
222 |
|
|
|
187 |
|
Other |
|
4,355 |
|
|
|
4,003 |
|
Total liabilities |
|
39,133 |
|
|
|
39,291 |
|
Other stockholders' equity |
|
30,581 |
|
|
|
30,523 |
|
Accumulated other comprehensive loss |
|
(175 |
) |
|
|
(217 |
) |
Total KMI stockholders' equity |
|
30,406 |
|
|
|
30,306 |
|
Noncontrolling interests |
|
1,340 |
|
|
|
1,423 |
|
Total stockholders' equity |
|
31,746 |
|
|
|
31,729 |
|
Total liabilities and stockholders' equity |
$ |
70,879 |
|
|
$ |
71,020 |
|
|
|
|
|
||||
Net Debt (1) |
$ |
31,687 |
|
|
$ |
31,837 |
|
|
|
|
|
||||
|
|
|
|
||||
|
|
|
|
||||
|
|
|
|
||||
|
Adjusted EBITDA Twelve Months Ended (2) |
||||||
Reconciliation of Net Income Attributable to |
|
|
|
||||
|
2024 |
|
|
|
2023 |
|
|
Net income attributable to |
$ |
2,540 |
|
|
$ |
2,391 |
|
Total Certain Items (3) |
|
(43 |
) |
|
|
19 |
|
DD&A |
|
2,325 |
|
|
|
2,250 |
|
Amortization of excess cost of equity investments |
|
49 |
|
|
|
66 |
|
Income tax expense (4) |
|
717 |
|
|
|
682 |
|
Interest, net (4) |
|
1,845 |
|
|
|
1,804 |
|
Amounts from joint ventures |
|
|
|
||||
Unconsolidated JV DD&A |
|
353 |
|
|
|
323 |
|
Less: Consolidated JV partners' DD&A |
|
(63 |
) |
|
|
(63 |
) |
Unconsolidated JV income tax expense |
|
78 |
|
|
|
89 |
|
Adjusted EBITDA |
$ |
7,801 |
|
|
$ |
7,561 |
|
|
|
|
|
||||
Net Debt-to-Adjusted EBITDA (5) |
|
4.1 |
|
|
|
4.2 |
|
Notes |
|
(1) |
Amounts calculated as total debt, less (i) cash and cash equivalents; (ii) debt fair value adjustments; and (ii) the foreign exchange impact on our Euro denominated debt of |
(2) |
Reflects the rolling 12-month amounts for each period above. |
(3) |
See table included in “Non-GAAP Financial Measures—Certain Items.” |
(4) |
Amounts are adjusted for Certain Items. See “Non-GAAP Financial Measures—Certain Items” for more information. |
(5) |
Year-end 2023 net debt reflects borrowings to fund the STX Midstream acquisition that closed on |
Table 7 |
|||||||||||||||
|
|||||||||||||||
Preliminary Supplemental Information |
|||||||||||||||
(In millions, unaudited) |
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
KMI FCF |
|
|
|
|
|
|
|
||||||||
Net income attributable to |
$ |
625 |
|
|
$ |
532 |
|
|
$ |
1,946 |
|
|
$ |
1,797 |
|
Net income attributable to noncontrolling interests |
|
26 |
|
|
|
23 |
|
|
|
80 |
|
|
|
71 |
|
DD&A |
|
587 |
|
|
|
561 |
|
|
|
1,758 |
|
|
|
1,683 |
|
Amortization of excess cost of equity investments |
|
12 |
|
|
|
18 |
|
|
|
37 |
|
|
|
54 |
|
Deferred income taxes |
|
97 |
|
|
|
141 |
|
|
|
454 |
|
|
|
495 |
|
Earnings from equity investments |
|
(211 |
) |
|
|
(234 |
) |
|
|
(662 |
) |
|
|
(607 |
) |
Distribution of equity investment earnings (1) |
|
184 |
|
|
|
205 |
|
|
|
600 |
|
|
|
572 |
|
Working capital and other items |
|
(71 |
) |
|
|
40 |
|
|
|
(88 |
) |
|
|
104 |
|
Cash flow from operations |
|
1,249 |
|
|
|
1,286 |
|
|
|
4,125 |
|
|
|
4,169 |
|
Capital expenditures (GAAP) |
|
(657 |
) |
|
|
(647 |
) |
|
|
(1,857 |
) |
|
|
(1,689 |
) |
FCF |
|
592 |
|
|
|
639 |
|
|
|
2,268 |
|
|
|
2,480 |
|
Dividends paid |
|
(643 |
) |
|
|
(634 |
) |
|
|
(1,915 |
) |
|
|
(1,898 |
) |
FCF after dividends |
$ |
(51 |
) |
|
$ |
5 |
|
|
$ |
353 |
|
|
$ |
582 |
|
Notes |
|
(1) |
Periods ended |
View source version on businesswire.com: https://www.businesswire.com/news/home/20241016700703/en/
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