TC Energy (TRP) Q4 2023 earnings summary

Executive summary

• Q4 2023 comparable EBITDA rose 16% YoY to $3.107B; full-year comparable EBITDA increased 11% to $10.988B.

• 2024 comparable EBITDA guidance is $11.2B–$11.5B; comparable EPS is expected to be lower than 2023.

• Operational highlights included Coastal GasLink mechanical completion, high pipeline utilization and continued progress on the proposed South Bow spinoff.

Financial highlights

• Q4 net income was $1.615B versus a $1.425B loss in Q4 2022; comparable earnings increased 24% to $1.403B.

• FY net income was $3.068B versus $1.374B in 2022; comparable earnings rose to $4.652B from $4.279B.

• FY net cash provided by operations was $7.268B versus $6.375B in 2022.

Outlook and guidance

• 2024 comparable EBITDA guidance is $11.2B–$11.5B, versus $10.988B in 2023; outlook excludes potential divestitures and the proposed Liquids spinoff.

• 2024 comparable EPS is expected to decline, reflecting higher non-controlling interests and Southeast Gateway AFUDC, partly offset by higher comparable EBITDA.

• 2024 net capital expenditures are expected at $8.0B–$8.5B; approximately $7B of assets are expected to enter service.

• Excluding Liquids Pipelines, 2023–2026 comparable EBITDA growth is guided at 6% CAGR; Liquids Pipelines outlook is 2%–3% CAGR.

• Dividend growth outlook remains 3%–5%; 2024 strategic priorities include reaching a 4.75x debt-to-EBITDA upper-limit target by year-end.