In This Article:
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Adjusted EBITDA: $610 million for 2024, a new high watermark for the company.
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Infrastructure Segment EBITDA: $601 million in 2024, an increase of $107 million over 2023.
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Marketing Segment EBITDA: Decreased from $145 million in 2023 to $63 million in 2024.
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Leverage: 3.5 times debt-to-adjusted EBITDA at year-end, within the target range of 3 to 3.5 times.
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Payout Ratio: 71%, within the target range of 70% to 80%.
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Quarterly Dividend: Increased by $0.02 or 5% to $0.43 per share.
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Distributable Cash Flow: $375 million in 2024, a decrease of approximately $11 million from 2023.
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Growth Capital and Share Repurchases: Up to $200 million planned for 2025.
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Cost Savings Target: Over $25 million by year-end 2025, with 50% already achieved on a run rate basis.
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Gateway Acquisition: Expected EBITDA growth of 15% to 20% by year-end 2025.
Release Date: February 19, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Gibson Energy Inc (GBNXF) achieved a record adjusted EBITDA of $610 million in 2024, marking a new high for the company.
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The Infrastructure segment demonstrated strong performance with a compound annual growth rate of approximately 14% since 2017.
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The Gateway acquisition has been a key catalyst, contributing significantly to the company's growth and exceeding expectations.
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Gibson Energy Inc (GBNXF) increased its quarterly dividend by 5% to $0.43 per share, marking the sixth consecutive dividend increase.
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The company is executing a cost focus campaign targeting over $25 million in cost savings by year-end, with 50% of this goal already achieved.
Negative Points
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The Marketing segment underperformed, with adjusted EBITDA decreasing from $145 million in 2023 to $63 million in 2024.
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The company faced challenging market conditions in the Marketing segment, including narrow differentials and steep backwardation.
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Gibson Energy Inc (GBNXF) anticipates another challenging quarter for Marketing in Q1 2025, with adjusted EBITDA expected to be around breakeven.
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The Infrastructure segment faced several non-recurring charges related to ongoing commercial matters, impacting adjusted EBITDA.
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The company's leverage exited the year at the high end of the target range, raising concerns about balancing growth capital and maintaining financial flexibility.
Q & A Highlights
Q: Could you provide more detail on the components that led to the Marketing segment's performance in 2024, and do you see this persisting in 2025? A: Riley Hicks, Senior Vice President and Chief Financial Officer, explained that the negative performance was due to increased feedstock costs, tight crack spreads, and seasonality affecting demand for paving asphalt. Additionally, ample egress and low inventory levels resulted in steep backwardation and limited volatility, leading to a cautious approach. The first quarter of 2025 is expected to face similar issues, but guidance will be re-evaluated in the Q1 call.