In This Article:
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Net Earnings: $185 million, up from $78 million year-over-year.
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Adjusted EBITDA: $322 million, compared to $288 million in the previous year.
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Distributable Cash Flow: $195 million or $0.85 per share, up from $186 million or $0.81 per share.
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Realized Margin - Gathering Processing Segment: $99 million.
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Realized Margin - Liquids Infrastructure Segment: $135 million.
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Realized Margin - Marketing Segment: $135 million.
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Net Debt to Adjusted EBITDA Ratio: 1.9 times, below the target range of 2.5 to 3 times.
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Marketing Segment Realized Margin Guidance for 2024: $450 million to $480 million.
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Growth Capital for 2024: Expected at the high end of $80 million to $100 million.
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Maintenance Capital for 2024: Between $120 million and $140 million.
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Cash Taxes for 2024: Expected to remain between $90 million and $100 million.
Release Date: November 14, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Keyera Corp (KEYUF) achieved strong performance across all three business segments, with significant contributions from gathering and processing, liquids infrastructure, and marketing.
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The company reported a substantial increase in net earnings to $185 million, compared to $78 million in the same period last year.
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Keyera Corp (KEYUF) maintained a strong financial position, with a net debt to adjusted EBITDA ratio of 1.9 times, below the targeted range of 2.5 to 3 times.
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The company is advancing capital-efficient growth projects, including the Frac II debottleneck and KFS Frac III, which are expected to significantly increase fractionation capacity.
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Keyera Corp (KEYUF) announced plans for share buybacks, providing flexibility in capital deployment to enhance shareholder value.
Negative Points
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The marketing segment's guidance for Q4 implies a potential step down in performance compared to previous quarters, indicating possible headwinds.
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Turnarounds at the Wapiti and Brazeau facilities took longer than expected, impacting operational efficiency and customer service.
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The company faces challenges in maintaining high utilization rates in its southern facilities due to lower gas prices.
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There is uncertainty regarding the timing of LNG Canada's Phase 2 decision, which could impact basin growth projections.
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Keyera Corp (KEYUF) must carefully balance capital allocation between growth projects and share buybacks, which could affect dividend growth expectations.
Q & A Highlights
Q: Can you provide an update on the KFS Frac III project and any equipment orders related to it? A: Dean Setoguchi, President and CEO, explained that frac demand in Western Canada is extremely tight, and their fractionator is very full. They see a lot of growth in the basin, particularly with LNG Canada and TMX, which will drive more fractionation demand. James Urquhart, Chief Commercial Officer, added that they have completed pre-feed and moved into feed, with significant progress on commercial contracting, increasing confidence in moving ahead with the projects in 2025.