Q2 2024 Kinder Morgan Inc Earnings Call Transcript
Key Points
- Kinder Morgan Inc (KMI) reported a solid quarter with adjusted EPS increasing by 4% and EBITDA by 3%, driven by growth in the natural gas segment and refined products business segments.
- The company ended the quarter with a debt to EBITDA ratio of 4.1 times and continues to return significant value to shareholders, including a dividend of $0.2875 per share.
- Kinder Morgan Inc (KMI) announced significant new projects, including the South System 4 expansion and the conversion of the Double H pipeline to natural gas liquids service, increasing their project backlog by $1.9 billion to $5.2 billion.
- The company is seeing substantial opportunities in the natural gas market, with commercial discussions on over 5 bcf a day of opportunities related to power demand, including data center demand.
- Kinder Morgan Inc (KMI) benefited from favorable Supreme Court decisions that are expected to mitigate regulatory challenges, providing a more favorable operating environment.
- Natural gas gathering volumes are expected to average about 6% below the 2024 plan due to the current gas price environment, although still 8% over 2023.
- The CO2 segment experienced lower production volumes, with oil production down 13%, NGL volumes down 17%, and CO2 volumes down 8% compared to the second quarter of 2023.
- Refined product volumes are expected to be slightly below the plan for the full year, about 1% below the initial budget.
- The company has faced operational challenges in its RNG (Renewable Natural Gas) business, leading to a temporary stand-down on significant acquisition opportunities until existing operations are stabilized.
- Interest expense increased due to a higher short-term debt balance, partly from the acquisition of South Texas midstream assets.
Welcome to the quarterly earnings conference call. (Operator Instructions) Today's call is also being recorded. If you do have any objections, you may disconnect at this time.
And I would now like to turn the call over to Rich Kinder, Executive Chairman of Kinder Morgan. Thank you. You may begin.
Thank you, Sue. As usual, before we begin, I'd like to remind you that KMI's earnings release today and this call include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the Securities Exchange Act of 1934 as well as certain non-GAAP financial measures.
Before making any investment decisions, we strongly encourage you to read our full disclosure on forward-looking statements and use of non-GAAP financial measures set forth at the end of our earnings release as well as review our latest filings with the SEC for important material assumptions, expectations, and risk factors that may cause actual results to differ materially from
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