Kinder Morgan Q3 Earnings: Revenue Miss, EPS Miss, Guidance Lower, Shares Slide

Kinder Morgan Inc KMI reported third-quarter financial results after the market close on Wednesday. Here’s a look at the key details from the quarter.

Q3 Earnings: Kinder Morgan reported third-quarter revenue of $3.699 billion, missing the consensus estimate of $3.975 billion, according to Benzinga Pro. The company reported quarterly earnings of 25 cents per share, missing analyst estimates of 27 cents per share.

Distributable cash flow came in at 49 cents per share after the company generated $1.2 billion in cash from operations and approximately $600 million in free cash flow during the quarter.

The company’s board approved a dividend of $0.2875 per share for the third quarter, payable on Nov. 15 to shareholders of record as of Oct. 31.

“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. 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,” said Kim Dang, CEO of Kinder Morgan.

“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.”

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Outlook: Kinder Morgan had been anticipating full-year 2024 distributable cash flow of $5 and adjusted EBITDA of $8.16 billion, both up 8% year-over-year. The company also previously expected to end the year with a Net Debt-to-Adjusted EBITDA ratio of 3.9 times.

“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,” Dang said.

Management will hold a conference call to discuss these results at 4:30 p.m. ET.

KMI Price Action: Kinder Morgan shares were up approximately 41% year-to-date heading into the print. The stock was down 3.81% after hours at $23.98 at the time of publication Wednesday, according to Benzinga Pro.

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