Kinder Morgan (KMI) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue was $3.57 billion, up 2% year-over-year, with net income attributable to shareholders at $575 million and adjusted net income at $548 million, up 1% year-over-year.

• Adjusted EPS rose 4% to $0.25, while reported EPS was flat at $0.26; adjusted EBITDA increased 3% to $1.86 billion.

• Dividend declared at $0.2875 per share for Q2, annualized to $1.15, a 2% increase over 2023.

• Major acquisitions and divestitures included the North McElroy Unit acquisition and the sale of certain CO₂ assets in the Permian Basin.

• Strong operational and financial performance, with $1.7 billion cash flow from operations and $1.1 billion free cash flow after capex.

Financial highlights

• Q2 2024 revenues increased by $71 million year-over-year, driven by higher services revenue and the STX Midstream acquisition.

• Operating income for Q2 2024 was $1.04 billion, up 1% year-over-year; six-month operating income was $2.26 billion, up 2%.

• DCF per share for Q2 2024 was $0.49, up 2% year-over-year; free cash flow after dividends was $465 million.

• Net debt at quarter-end was $31.5 billion, with net debt-to-adjusted EBITDA at 4.1x.

• Cash flows from operations for the first six months were $2.88 billion, flat year-over-year.

Outlook and guidance

• 2024 dividend guidance is $1.15 per share, a 2% increase from 2023.

• 2024 net income guidance is $2.7 billion ($1.22 per share), DCF guidance is $5 billion ($2.26 per share), and Adjusted EBITDA is $8.16 billion, all up from 2023.

• Project backlog at end of Q2 was $5.2 billion, with 80% focused on lower-carbon energy investments.

• Capital spending expected to be around $2 billion annually for the foreseeable future, with large projects like SNG filling out outer years.

• Management expects full-year results to be on budget or within 1-2% below, with commodity price and operational headwinds offset by strong transport and storage contributions.