Post Earnings Coverage as Kinder Morgan Turns Green
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Upcoming AWS Coverage on Spectra Energy Post-Earnings Results
LONDON, UK / ACCESSWIRE / January 23, 2017 / Active Wall St. announces its post-earnings coverage on Kinder Morgan, Inc. (NYSE: KMI). The company reported its Q4 and fiscal 2016 results on January 18, 2017. The oil and natural gas pipeline and storage Company's revenue figures outperformed analyst estimates. Register with us now for your free membership at:
One of Kinder Morgan's competitors within the Oil & Gas Pipelines space, Spectra Energy Corp. (NYSE: SEP), announced on January 06, 2017, that it will issue its Q4 2016 earnings results before the market opens on Friday, February 17, 2017, in order to coincide with their planned 10-K filings. AWS will be initiating a research report on Spectra Energy in the coming days.
Today, AWS is promoting its earnings coverage on KMI; touching on SEP. Get our free coverage by signing up to:
For the three months ended on December 31, 2016, Kinder Morgan's total revenue came in at $3.39 billion, down 6.8% compared to revenue of $3.64 billion in the year earlier same period. The Company's revenue numbers surpassed analysts' forecasts of $3.32 billion. For FY16, Kinder Morgan generated revenue of $13.06 billion compared to revenue of $14.40 billion reported for FY15.
Kinder Morgan reported Q4 2016 net income available to common stockholders of $170 million compared to a net loss available to common stockholders of $721 million for Q4 2015. On a per-share basis, which includes preferred dividend effects, the Company reported earnings of $0.08 per share compared to loss of $0.32 per share in the year earlier same period. Kinder Morgan noted that the current quarter included a $250 million write down of the Company's equity investment in its Ruby pipeline, driven by a delay in expected west coast natural gas demand growth to beyond 2021. Q4 2015 certain items included a goodwill impairment of $1.15 billion. On an adjusted basis, the Company earned $0.18 per share, which was in-line with analysts' average estimates.
For FY16, KMI reported net income available to common stockholders of $552 million compared to $227 million for 2015. Apart from the impact on net income in Q4 2016, the Company's net income available to common stockholders for FY16 was further impacted by a $508 million favorable change in total certain items compared to FY15.
For Q4 2016, Kinder Morgan reported distributable cash flow of $1.15 billion versus $1.23 billion for the comparable period in 2015. The Company attributed the drop in distributable cash flow to lower contributions from SNG as a result of a 50% sale of the pipeline during Q3 2016 and from the CO2 segment primarily due to lower realized crude oil prices and lower volumes, and partially offset by higher contributions from the Terminals and Products Pipelines segments. For FY16, the Company posted distributable cash flow of $4.51 billion compared to distributable cash flow of $4.70 billion for FY15.
Kinder Morgan stated that at the end of Q4 2016, its backlog stood at $12 billion which is down from $13 billion in Q3 2016. Kinder Morgan placed a little under $800 million worth of projects into service during the reported quarter and approximately $1.8 billion over FY16. The Company removed $200 million worth of projects in Q4 2016, and overall $4.6 billion of projects were removed over FY16.
Outlook
On December 05, 2016, Kinder Morgan issued its preliminary FY17 financial projections and said it expects to declare dividends of $0.50 per share and to achieve distributable cash flow of approximately $4.46 billion and an adjusted EBITDA of approximately $7.2 billion.
Segment Results
During Q4 2016, Kinder Morgan's natural gas' segment earnings before depreciation, depletion, and amortization of excess cost of equity investments (DD&A) and Certain Items (Segment EBDA before Certain Items) totaled $984 million compared to Segment EBDA before Certain Items of $1.01 billion in Q4 2015. The decline was attributed primarily to the sale of SNG. For the company's CO2 segment's EBDA before Certain Items decreased by approximately $54 million to $238 million in the reported quarter, due to lower oil price and approximately 8% lower production.
During Q4 2016, Kinder Morgan's Terminals segment's EBDA before Certain Items advanced 15% to $296 million compared to $257 million in Q4 2015, driven by increased contributions from its Jones Act tankers and joint venture with BP. The Company's Products Pipelines segment's EBDA before Certain Items was up 7% on a y-o-y basis to $308 million in the reported quarter.
Cash Flow & Balance Sheet
As of December 31, 2016, Kinder Morgan had cash and cash equivalents worth $684 million compared to cash and cash equivalents worth $229 million as on December 31, 2015. The Company ended the quarter with a net debt of $38.16 billion, which translates into net debt to adjusted EBITDA of 5.3 times. For FY16, Kinder Morgan's debt decreased by $3.064 billion, and for Q4 2016 the company had a reduction in debt of $1.088 billion.
Stock Performance
Kinder Morgan's share price finished last Friday's trading session at $22.49, slightly inching up 0.09%. A total volume of 17.13 million shares exchanged hands, which was higher than the 3 months' average volume of 14.22 million shares. The stock has rallied 9.25% and 66.61% in the last three months and past twelve months, respectively. Furthermore, since the start of the year, shares of the Company have gained 8.59%. The stock has a dividend yield of 2.22% and currently has a market cap of $49.69 billion. Additionally, Kinder Morgan's stock is trading at a P/E of 90.69.
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