TC Energy Q3 Earnings Top Estimates, Appoints Board Chair, Revises Guidance & More

TC Energy Corp TRP reported third-quarter (Q3) 2023 comparable EPS of 74 cents, beating the consensus of 71 cents, and sales of $2.94 billion exceeding the estimate of $2.75 billion.

The Calgary, Canada-based company's comparable EBITDA rose 7% Y/Y to C$2.6 billion on growth across most segments. 

U.S. Natural Gas Pipelines reported a comparable EBITDA of C$968 million (vs. C$926 million a year ago), and Canadian Natural Gas Pipelines' comparable EBITDA rose to C$781 million from C$713 million a year ago.

NGTL System receipts averaged 14.0 Bcf/d, up 0.5 Bcf/d Y/Y, and U.S. Natural Gas Pipelines LNG deliveries averaged 3.1 Bcf/d, up 1.4% Y/Y.

Segment earnings declined to C$0.6 billion from C$1.8 billion a year ago due to the after-tax impairment charge of C$1.179 billion related to equity investment in Coastal GasLink Pipeline Limited Partnership.

Operating cash flow increased to C$1.8 billion from C$1.7 billion in the prior year. Capital spending rose to C$3.3 billion from C$2.6 billion in Q3 2022.

Year to date, the company has placed around C$5 billion of projects into service on its natural gas and liquids pipeline systems, and the Bruce Power Unit 6 MCR (declared commercially operational on Sept. 14, 2023).

CEO François Poirier noted "monumental progress on Coastal GasLink" and "exceptional safety and construction execution" on this project, which remains on track with a $14.5 billion cost estimate.

Leadership Transition: John E. Lowe will be board chairperson effective Jan. 1, 2024; Siim A. Vanaselja will step down as chairman of the board effective Dec. 31.

Dividend: The company declared a quarterly dividend of C$0.93 per share, payable on Jan. 31, 2024, to shareholders of record as of Dec. 29.

Outlook: TRP now expects FY23 comparable EBITDA to be at the upper end of 5%-7% outlook vs. 2022 and 2023 and comparable earnings per share to be generally consistent with 2022. 

Total capital expenditures is projected to be around C$12.0 billion to C$12.5 billion.

Asset Sale: The company disclosed the successful completion of the sale of 40% of non-controlling equity interest in the Columbia Gas and Columbia Gulf systems for cash proceeds of C$5.3 billion ($3.9 billion). 

Price Action: TRP shares are trading higher by 0.84% at $36.21 on the last check Wednesday.