Released on October 18, 2023, Kinder Morgan Inc (KMI, Financial)'s Q3 2023 financial results show a strong performance across its portfolio of assets, despite a slight dip in earnings. The company's board of directors approved a cash dividend of $0.2825 per share for the third quarter, payable on November 15, 2023, marking a 2% increase over the third quarter of 2022.
Financial Highlights
KMI reported a Q3 EPS of $0.24, a slight decrease from Q3 2022, while DCF per share remained flat at $0.49. Net income attributable to KMI was $532 million, compared to $576 million in Q3 2022. The company also reported a DCF of $1,094 million, compared to $1,122 million in Q3 2022, and Adjusted Earnings of $562 million for the quarter, versus $575 million in Q3 2022.
Management Commentary
Executive Chairman Richard D. Kinder commented on the company's performance, stating,
During the quarter the company experienced the second management succession in its history, but our time-tested strategy remains the same. We return value to shareholders while maintaining a strong balance sheet."He further highlighted the company's commitment to funding capital projects that yield returns well above their cost of capital, including projects that contribute to a lower carbon future.
Financial Analysis
KMI ended the quarter with a Net Debt-to-Adjusted EBITDA ratio of 4.1, in line with its year-end goal. The company also continued its share repurchase program, buying back more than 28 million shares for approximately $472 million so far this year. Despite higher interest expenses and sustaining capital expenditures, both EPS and DCF per share benefited from these share repurchases.
Looking Ahead
For 2023, KMI budgeted net income attributable to KMI of $2.5 billion ($1.12 per share) and dividends of $1.13 per share, a 2% increase from the dividends declared for 2022. The company also budgeted 2023 DCF of $4.8 billion ($2.13 per share), Adjusted EBITDA of $7.7 billion and to end 2023 with a Net Debt-to-Adjusted EBITDA ratio of 4.0 times, well below its long-term target of 4.5 times.
