All financial figures are in Canadian dollars unless otherwise
noted. This news release refers to certain financial measures and
ratios that are not specified, defined or determined in accordance
with Generally Accepted Accounting Principles ("GAAP"), including
net revenue; adjusted earnings before interest, taxes, depreciation
and amortization ("adjusted EBITDA"); adjusted cash flow from
operating activities; adjusted cash flow from operating activities
per common share; and proportionately consolidated debt-to-adjusted
EBITDA. For more information see "Non-GAAP and Other Financial
Measures" herein.
Pembina Pipeline Corporation ("Pembina" or the "Company") (TSX:
PPL; NYSE: PBA) announced today its financial and operating results
for the fourth quarter and full year of 2024.
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Highlights
- Record Results - reported 2024 full year earnings of
$1,874 million, record full year adjusted EBITDA of $4,408 million,
and record full year adjusted cash flow from operating activities
of $3,265 million ($5.70 per share). Reported fourth quarter
earnings of $572 million, record quarterly adjusted EBITDA of
$1,254 million, and record quarterly adjusted cash flow from
operating activities of $922 million ($1.59 per share).
- Business Updates - developments during and following the
fourth quarter included:
- Pembina Gas Infrastructure ("PGI") closed separate transactions
with Whitecap Resources Inc. ("Whitecap") and Veren Inc. ("Veren")
that included asset acquisitions and funding of up to a total of
$700 million ($420 million net to Pembina) for new infrastructure
development.
- In November 2024, the northeast British Columbia ("NEBC") MPS
Expansion was placed into service on time and under budget, adding
to Pembina's record of strong project execution.
- Pembina continues to successfully contract the Nipisi Pipeline
to serve growing volumes from the Clearwater area and recently
contracted an additional 25,000 bbl/d of capacity on a long-term
basis.
- Pembina continues to advance a process with multiple parties to
remarket its contracted Cedar LNG Project capacity and has received
non-binding proposals covering well in excess of its contracted
capacity.
- Pembina is advancing development work on various capital
efficient projects to meet its ethane supply commitments below the
low end of the capital range previously communicated, and respond
to growing demand for services, including the de-ethanizer
expansion at RFS III, the Taylor-to-Gordondale pipeline expansion,
and the Fox-to-Namao pipeline expansion.
- Pembina has entered into agreements for a 50 percent interest
in the Greenlight Electricity Centre Limited Partnership, which is
developing a power generation facility to serve data centre
customers.
- Pembina has secured the sole natural gas liquids ("NGL")
extraction rights from the Yellowhead Mainline natural gas pipeline
and is advancing engineering of an up to 500 MMcf/d straddle
facility.
- Common Share Dividend Declared - the board of directors
declared a common share cash dividend for the first quarter of 2025
of $0.69 per share to be paid, subject to applicable law, on March
31, 2025, to shareholders of record on March 17, 2025.
Financial and Operational Overview
3 Months Ended December
31
12 Months Ended December
31
($ millions, except where noted)
2024
2023
2024
2023
Revenue(1)
2,145
1,836
7,384
6,331
Net revenue(1)(2)
1,383
1,142
4,776
3,973
Gross profit
1,024
850
3,316
2,840
Adjusted EBITDA(2)
1,254
1,033
4,408
3,824
Earnings
572
698
1,874
1,776
Earnings per common share – basic
(dollars)
0.92
1.21
3.00
3.00
Earnings per common share – diluted
(dollars)
0.92
1.21
3.00
2.99
Cash flow from operating activities
902
880
3,214
2,635
Cash flow from operating activities per
common share – basic (dollars)
1.55
1.60
5.61
4.79
Adjusted cash flow from operating
activities(2)
922
747
3,265
2,646
Adjusted cash flow from operating
activities per common share – basic (dollars)(2)
1.59
1.36
5.70
4.81
Capital expenditures
242
177
955
606
(1)
Comparative 2023 period has been
adjusted. See "Accounting Policies & Estimates - Change in
Accounting Policies" in Pembina's Management's Discussion and
Analysis dated February 27, 2025 for the three and twelve months
ended December 31, 2024 and Note 4 to the Consolidated Financial
Statements for the year ended December 31, 2024.
(2)
Refer to "Non-GAAP and Other
Financial Measures".
Financial and Operational Overview by Division
3 Months Ended December
31
12 Months Ended December
31
2024
2023
2024
2023
($ millions, except where noted)
Volumes(1)
Earnings (Loss)
Adjusted EBITDA(2)
Volumes(1)
Earnings (Loss)
Adjusted EBITDA(2)
Volumes(1)
Earnings (Loss)
Adjusted EBITDA(2)
Volumes(1)
Earnings (Loss)
Adjusted EBITDA(2)
Pipelines
2,790
534
686
2,652
677
617
2,711
1,907
2,533
2,538
1,840
2,234
Facilities
877
177
373
801
143
324
837
666
1,347
768
610
1,213
Marketing & New Ventures
349
245
234
299
204
173
327
569
724
271
435
597
Corporate
—
(212)
(39)
—
(209)
(81)
—
(1,422)
(196)
—
(696)
(220)
Income tax expense/recovery
—
(172)
—
—
(117)
—
—
154
—
—
(413)
—
Total
572
1,254
698
1,033
1,874
4,408
1,776
3,824
(1)
Volumes for the Pipelines and
Facilities divisions are revenue volumes, which are physical
volumes plus volumes recognized from take-or-pay commitments.
Volumes are stated in mboe/d, with natural gas volumes converted to
mboe/d from MMcf/d at a 6:1 ratio. Volumes for Marketing & New
Ventures are marketed crude and NGL volumes.
(2)
Refer to "Non-GAAP and Other
Financial Measures".
For further details on the Company's significant assets,
including definitions for capitalized terms used herein that are
not otherwise defined, refer to Pembina's Annual Information Form
for the year ended December 31, 2024, and Pembina's Management's
Discussion and Analysis dated February 27, 2025 for the three and
twelve months ended December 31, 2024, filed at www.sedarplus.ca
(filed with the U.S. Securities and Exchange Commission at
www.sec.gov under Form 40-F) and on Pembina's website at
www.pembina.com.
Financial & Operational Highlights
Adjusted EBITDA
Pembina reported record quarterly adjusted EBITDA of $1,254
million in the fourth quarter and record full year adjusted EBITDA
of $4,408 million. This represents a $221 million or 21 percent
increase, and a $584 million or 15 percent increase, respectively,
over the same periods in the prior year. For both the fourth
quarter and full year, reported adjusted EBITDA compared to the
prior periods is largely due to the positive net impacts of
increased ownership in Alliance and Aux Sable (the "Alliance/Aux
Sable Acquisition"), higher NGL margins, and volume growth across
the business, partially offset by lower net revenue on the Cochin
Pipeline. Additional factors impacting fourth quarter and full year
results in each division are discussed below.
2024 results exceeded Pembina's most recent 2024 adjusted EBITDA
guidance range of $4.225 billion to $4.325 billion. Relative to the
midpoint of the guidance range, actual results reflect the
following:
- the timing of capital recovery recognition on certain assets
within Pipelines and at PGI, resulting in a recognition in the
fourth quarter of previously deferred revenue ($37 million);
- lower general & administrative expense primarily due to
lower long-term incentive costs during the fourth quarter ($30
million);
- stronger results from the marketing business due to a
significant improvement in NGL frac spreads ($46 million); and
- stronger fourth quarter results in the Pipelines and Facilities
divisions ($20 million).
Pipelines reported adjusted EBITDA of $686 million for the
fourth quarter, representing a $69 million or 11 percent increase
compared to the same period in the prior year, reflecting the net
impact of the following factors:
- higher contribution from Alliance due to increased ownership
following the Alliance/Aux Sable Acquisition and higher demand on
seasonal contracts;
- higher revenue related to the timing of capital recovery
recognition on certain Pipeline assets ($23 million);
- higher volumes on the Nipisi Pipeline;
- net revenues on the Peace Pipeline system were consistent as
higher contracted volumes and contractual inflation adjustments on
tolls were largely offset by earlier recognition of take-or-pay
deferred revenue during the first half of 2024; and
- lower net revenue on the Cochin Pipeline, largely due to lower
firm tolls and lower interruptible demand resulting from a narrower
condensate price differential between western Canada and the U.S.
Gulf Coast.
Pipelines reported adjusted EBITDA of $2,533 million for the
full year, representing a $299 million or 13 percent increase
compared to the same period in the prior year, reflecting the net
impact of the following factors:
- higher contribution from Alliance due to increased ownership
following the Alliance/Aux Sable Acquisition and higher demand on
seasonal contracts;
- no impacts in 2024 from the Northern Pipeline system outage and
the wildfires, which affected 2023;
- higher revenue and volumes, primarily on the Peace Pipeline
system and on the Nipisi Pipeline;
- contractual inflation adjustments on tolls;
- higher net revenue related to the timing of capital recovery
recognition on certain Pipelines assets ($23 million); and
- lower net revenue and volumes on the Cochin Pipeline.
Facilities reported adjusted EBITDA of $373 million for the
fourth quarter, representing a $49 million or 15 percent increase
over the same period in the prior year, reflecting the net impact
of the following factors:
- the inclusion within Facilities of adjusted EBITDA from Aux
Sable following the Alliance/Aux Sable Acquisition; and
- higher contribution from PGI assets, due to higher revenue
associated with the oil batteries acquired in the fourth quarter of
2024, higher volumes at certain PGI assets, and the timing of
capital recovery recognition ($14 million).
Facilities reported adjusted EBITDA of $1,347 million for the
full year, representing a $134 million or 11 percent increase over
the same period in the prior year, reflecting the net impact of the
following factors:
- the inclusion within Facilities of adjusted EBITDA from Aux
Sable following the Alliance/Aux Sable Acquisition;
- higher contribution from PGI assets, due to higher revenue
associated with the oil batteries acquired in the fourth quarter of
2024, higher volumes at certain PGI assets, and the timing of
capital recovery recognition ($14 million);
- no impacts in 2024 from the Northern Pipeline system outage and
the wildfires, which affected volumes in 2023; and
- a gain on the recognition of a finance lease, which affected
2023 only.
Marketing & New Ventures reported adjusted EBITDA of $234
million for the fourth quarter, representing a $61 million or 35
percent increase compared to the same period in the prior year,
reflecting the net impact of the following factors:
- higher net revenue from contracts with customers due to
increased ownership interest in Aux Sable;
- higher NGL margins; and
- lower realized gains on commodity-related derivatives.
Marketing & New Ventures reported adjusted EBITDA of $724
million for the full year, representing a $127 million or 21
percent increase compared to the same period in the prior year,
reflecting the net impact of the following factors:
- higher net revenue from contracts with customers due to
increased ownership interest in Aux Sable following the
Alliance/Aux Sable Acquisition;
- higher NGL margins;
- lower realized gains on commodity-related derivatives; and
- the nine-day unplanned outage at Aux Sable in July 2024.
Corporate reported adjusted EBITDA of negative $39 million for
the fourth quarter, representing a $42 million or 52 percent
increase compared to the same period in the prior year, reflecting
lower incentive costs.
Corporate reported adjusted EBITDA of negative $196 million for
the full year, representing a $24 million or 11 percent increase
over the same period in the prior year, reflecting lower general
and administrative expense, primarily due to lower consulting costs
and lower incentive costs.
Earnings
Pembina reported fourth quarter earnings of $572 million and
full year earnings of $1,874 million. This represents a $126
million or 18 percent decrease, and a $98 million or six percent
increase, respectively, over the same periods in the prior
year.
Pipelines had earnings in the fourth quarter of $534 million,
representing a $143 million or 21 percent decrease over the prior
period. Pipelines had earnings for the full year of $1,907 million,
representing a $67 million or four percent increase over the prior
year. In addition to the factors impacting adjusted EBITDA, as
noted above, the change in earnings in both the fourth quarter and
full year was due to the reversal of a previous impairment related
to the Nipisi Pipeline, which impacted the fourth quarter of
2023.
Facilities had earnings in the fourth quarter of $177 million
representing a $34 million or 24 percent increase over the prior
year. Facilities had earnings for the full year of $666 million
representing a $56 million or nine percent increase over the prior
year. In addition to the factors impacting adjusted EBITDA, as
noted above, the change in earnings in both the fourth quarter and
full year was due to unrealized gains recognized by PGI on interest
rate derivative financial instruments compared to unrealized losses
in 2023.
Marketing & New Ventures had earnings in the fourth quarter
of $245 million representing a $41 million or 20 percent increase
over the prior year. In addition to the factors impacting adjusted
EBITDA, as noted above, the change in earnings in the fourth
quarter was due to unrealized losses on commodity-related
derivatives, compared to unrealized gains in the prior period, and
unrealized gains on interest rate derivative financial instruments,
recognized by Cedar LNG.
Marketing & New Ventures had earnings for the full year of
$569 million representing a $134 million or 31 percent increase,
over the prior year. In addition to the factors impacting adjusted
EBITDA, as noted above, the change in full year earnings was due to
unrealized gains on interest rate derivative financial instruments
recognized by Cedar LNG; gains associated with the derecognition of
the provision related to financial assurances provided by Pembina,
which were assumed by Cedar LNG following the positive final
investment decision ("FID") in June 2024; larger unrealized losses
on commodity-related derivatives, primarily related to renewable
power purchase agreements and crude oil, and higher
depreciation.
In addition to the changes in earnings for each division
discussed above, the change in both the fourth quarter and full
year earnings compared to the prior period was due to higher
interest expense and higher income tax expense. The change in full
year earnings was further affected by the loss on Alliance/Aux
Sable Acquisition, higher acquisition fees and integration costs,
and an income tax recovery in 2024 compared to an expense in
2023.
Cash Flow From Operating Activities
Cash flow from operating activities of $902 million for the
fourth quarter and $3,214 million for the full year represent a
three percent and 22 percent increase, respectively, over the same
periods in the prior year.
The increase in the fourth quarter was primarily driven by
higher operating results, partially offset by the change in
non-cash working capital, and lower distributions from equity
accounted investees and higher net interest paid, both largely as a
result of the Alliance/Aux Sable Acquisition.
The increase in the full year was primarily driven by higher
operating results, the change in non-cash working capital, and an
increase in payments collected through contract liabilities,
partially offset by lower distributions from equity accounted
investees, higher net interest paid, higher taxes paid, and higher
share-based payments.
On a per share (basic) basis, cash flow from operating
activities was $1.55 per share for the fourth quarter and $5.61 per
share for the full year. This represents a decrease of three
percent and an increase of 17 percent, respectively, compared to
the same periods in the prior year, due to the same factors noted
above, as well as additional common shares issued in connection
with the Alliance/Aux Sable Acquisition financing.
Adjusted Cash Flow From Operating Activities
Adjusted cash flow from operating activities of $922 million for
the fourth quarter and $3,265 million for the full year, represent
a 23 percent increase over the same periods in the prior year.
The increase in the fourth quarter was primarily driven by the
same items impacting cash flow from operating activities, discussed
above, excluding the change in non-cash working capital, combined
with lower accrued share-based payment expense, partially offset by
higher income tax expense.
The increase in the full year was primarily driven by the same
items impacting cash flow from operating activities, discussed
above, excluding the change in non-cash working capital, taxes
paid, and share-based payments, combined with lower current income
tax expense, partially offset by higher accrued share-based payment
expense, distributions to non-controlling interest, and higher
preferred dividends paid.
On a per share (basic) basis, adjusted cash flow from operating
activities was $1.59 per share for the fourth quarter and $5.70 per
share for the full year. This represents an increase of 17 percent
and 19 percent, respectively, compared to the same periods in the
prior year, due to the same factors noted above, as well as
additional common shares issued in connection with the Alliance/Aux
Sable Acquisition financing.
Volumes
Total Pipelines and Facilities volumes of 3,667 mboe/d for the
fourth quarter and 3,548 mboe/d for the full year represent an
increase of six percent and seven percent, respectively, over the
same periods in the prior year.
Pipelines volumes of 2,790 mboe/d in the fourth quarter
represent a five percent increase compared to the same period in
the prior year, primarily reflecting the Alliance/Aux Sable
Acquisition, the reactivation of the Nipisi Pipeline, lower volumes
on the Peace Pipeline system due to earlier recognition of
take-or-pay deferred revenue in the first half of 2024, which more
than offset the increase from higher contracted volumes, and lower
volumes on the Cochin Pipeline largely due to lower interruptible
demand.
Pipelines volumes of 2,711 mboe/d for the full year represent a
seven percent increase compared to the same period in the prior
year, primarily reflecting the Alliance/Aux Sable Acquisition, the
reactivation of the Nipisi Pipeline, no impact of the Northern
Pipeline system outage and the wildfires, which impacted 2023 only,
higher volumes on the Peace Pipeline system due to higher
contracted volumes, and lower volumes on the Cochin Pipeline.
Facilities volumes of 877 mboe/d in the fourth quarter represent
a nine percent increase compared to the same period in the prior
year, reflecting volumes now being recognized at Aux Sable
following the Alliance/Aux Sable Acquisition.
Facilities volumes of 837 mboe/d for the full year represent a
nine percent increase compared to the same period in the prior
year, reflecting volumes now being recognized at Aux Sable
following the Alliance/Aux Sable Acquisition, no impact of the
Northern Pipeline system outage, which impacted 2023 only, higher
interruptible and contracted volumes on certain PGI assets,
partially offset by lower volumes due to a planned outage and a
rail strike at the Redwater Complex.
Marketed NGL volumes of 252 mboe/d in the fourth quarter and 228
mboe/d for the full year represents a 16 percent and 23 percent
increase, respectively, compared to the same periods in the prior
year, reflecting higher propane, ethane, and butane sales largely
due to the increase in Pembina's ownership interest in Aux Sable.
The increase in the full year was also impacted by lower supply
volumes from the Redwater Complex in 2023 due to the Northern
Pipeline system outage.
Marketed crude oil volumes of 96 mboe/d in the fourth quarter
and 99 mboe/d for the full year represents a 17 percent and 15
percent increase, respectively, compared to the same periods in the
prior year, reflecting increased blending opportunities due to
favourable price differentials.
Executive Overview
Successful Strategy Execution
2024 was marked by several accomplishments that highlight the
successful execution of Pembina's strategy and our focus on
strengthening the existing franchise, increasing our exposure to
lighter hydrocarbons and resilient end-use markets, and accessing
global market pricing for Canadian energy products. Highlights
included:
- Growing our presence in resilient northeast U.S. natural gas
and NGL markets by fully consolidating ownership of Alliance and
Aux Sable.
- Furthering global market access for Canadian natural gas
producers by reaching a positive FID on the Cedar LNG Project.
- Adding capital efficient, timely, and certain capacity to
accommodate growing Western Canadian Sedimentary Basin ("WCSB")
production through completion of the Phase VIII Peace Pipeline
Expansion.
- Supporting growth-focused Montney and Duvernay area customers
with tailored solutions through two PGI transactions.
- Capitalizing on new long-term, stable demand for ethane from
Alberta’s growing petrochemical industry by entering a 50,000
barrel per day ethane supply agreement with Dow Chemical Canada
("Dow").
- Commercial successes across the business, including executing
incremental contracts or renewing contracts for:
- approximately 170 mboe/d of pipeline transportation, primarily
on Alliance Pipeline, Peace Pipeline, and Nipisi Pipeline;
- over six million barrels of storage at the Edmonton
Terminals;
- approximately 200 MMcf/d of gas processing, primarily at
Musreau, Patterson Creek, and K3; and
- additional fractionation services across the Redwater
Complex.
Preliminary 2024 data suggests annual production growth in
British Columbia and Alberta of approximately four percent, with
NGL and condensate growth having outpaced other hydrocarbons.
Pembina's assets play an essential role in the basin, and as such
the Company's conventional pipeline and gas processing volume
growth roughly mirrored year-over-year basin growth, and asset
utilization has continued to rise.
The Pembina Advantage
Our portfolio of high-quality assets, combined with the breadth
of our capabilities, provides an unmatched service offering for our
customers. We provide fully integrated, end-to-end solutions across
all products – natural gas, NGL (ethane, propane and butane),
condensate, and crude oil. Through our unique combination of
strategically-placed assets and strong customer and community
relationships we have built strong competitive advantages, allowing
us to capitalize on opportunities and serve our customers better.
Successfully meeting the needs of our customers will underpin
Pembina’s future success and in turn our ability to deliver
industry-leading returns to our investors, remain an
employer-of-choice to a highly engaged workforce, and have a
positive net impact within our communities.
Looking Ahead: Our Vision for 2025 and
Beyond
Pembina operates at the heart of the WCSB, one of North
America’s most significant hydrocarbon-producing regions.
Significant and multi-year volume growth in WCSB production is
expected through the balance of the decade due to a variety of
catalysts driving transformational change across the Canadian
energy industry. First among them is the development of LNG export
facilities, including our own Cedar LNG Project. Currently approved
and future LNG projects will connect the basin’s vast natural gas
reserves to high-demand global markets, particularly in Asia,
ensuring long-term demand that is expected to spur significant
additional production. Other developments include the recent
completion of the Trans Mountain Pipeline expansion that added
roughly 600,000 barrels per day of new oil export capacity and will
in turn drive additional condensate demand, the development of new
West Coast NGL export projects, new petrochemical facilities
creating significant demand for ethane and propane, and the
potential for rising intra-basin demand for natural gas to power a
new and potentially significant data center industry.
Our integrated value chain provides a full suite of midstream
and transportation services across all of these commodities, and
therefore we believe Pembina is best positioned to benefit from the
growth we are seeing and expect to continue to see in the WCSB.
Throughout 2025 we are focused on:
- Continuing our relentless efforts on safe, reliable, and
cost-effective operations;
- Enhancing utilization of existing assets and continuing to
renew, and sign incremental new, contracts; most notably we are
seeing momentum and demand for services across the Peace Pipeline
system, Nipisi Pipeline, the Redwater Complex, and PGI assets;
- Executing in flight projects safely and on time and on budget,
including Cedar LNG, RFS IV, the Wapiti Expansion, and the K3
Cogeneration Facility; and
- Advancing capital efficient expansions that include
infrastructure to support the Dow Supply Agreement, and expansions
to support volume growth in NEBC.
We are excited about the opportunities that lie ahead and look
forward to sharing our progress over the coming year.
Business Updates
Greenlight Electricity Centre
Pembina has entered into agreements for a 50 percent interest in
the Greenlight Electricity Centre Limited Partnership ("Greenlight
LP"), which is developing a gas-fired combined cycle power
generation facility to be located in Alberta’s Industrial Heartland
and constructed in multiple 450 MW phases, up to 1,800 MW (the
"Greenlight Electricity Centre"). This project would be constructed
on land owned by Pembina, adjacent to its Redwater Complex.
Greenlight LP will be owned equally by Pembina and Kineticor
Holdings LP#3, a subsidiary of OPTrust.
The Greenlight Electricity Centre has been, and will continue to
be, developed on behalf of Greenlight LP by Kineticor Asset
Management LP ("Kineticor"). Kineticor successfully developed the
Cascade power facility near Edson, Alberta, a gas-fired combined
cycle power generation facility capable of generating up to 900 MW
of power. Greenlight LP is in active discussions with data center
customers to commercially underpin the project and believes the
lands within Alberta’s Industrial Heartland are well suited given
their proximity to transmission and utility infrastructure.
With generation interconnection applications currently in stage
3 of the AESO process, Greenlight LP could be in a position to
place a facility into service as early as 2029.
In addition, Pembina is well positioned to leverage its existing
and future value chain to further support this project. The
proximity of Alliance Pipeline offers a potential accretive
expansion opportunity to provide natural gas supply to the
Greenlight Electricity Centre, and the potential future development
of the Alberta Carbon Grid may provide a future emissions reduction
solution.
Yellowhead Mainline Extraction
Opportunity
Pembina has secured the sole extraction rights from the
Yellowhead Mainline, a one billion cubic feet per day natural gas
delivery pipeline that is under construction by ATCO.
Pembina is currently advancing engineering of an up to 500
MMcf/d straddle facility at which up to 25,000 bpd of NGL mix would
be extracted from the natural gas stream and transported to the
Fort Saskatchewan, Alberta area for fractionation and sale. The
straddle facility would be located on Pembina owned lands.
Pembina has significant experience building and operating
liquids extraction facilities and currently operates assets with
approximately 1.8 bcf/d (1.5 bcf/d net to Pembina) of extraction
capacity through its Empress and Younger facilities.
Alliance Pipeline
Alliance continues to work collaboratively with its stakeholders
through the Canada Energy Regulator ("CER") review process and
remains focused on delivering the highest standards of service that
customers have come to expect. Alliance will work expeditiously
throughout 2025 with shippers towards a negotiated solution, in
accordance with all CER direction. The CER has ordered that the
current tolls shall be deemed interim tolls until resolution of the
matter.
2025 Guidance
In December 2024, Pembina announced a 2025 adjusted EBITDA
guidance range of $4.2 billion to $4.5 billion, which relative to
2024 reflects the impacts of continued volume growth across the
WCSB, new assets acquired or placed into service, and the full year
impact of the consolidation of the Alliance and Aux Sable assets,
partially offset primarily by the full year impact of the
recontracting of the Cochin Pipeline, and normalization of
commodity margins in the marketing business.
Despite proposed tariffs on U.S. energy imports, Pembina does
not expect any material near-term impacts given the highly
contracted, take-or-pay nature of its business.
The 2025 adjusted EBITDA guidance range reflects quarterly
seasonality in Pembina's business including:
- higher contribution from Alliance in the first and fourth
quarters due to the ability to transport higher volumes during
colder periods;
- higher integrity and geotechnical costs on the conventional
pipeline assets in the third and fourth quarters; and
- stronger first and fourth quarter results in the NGL marketing
business.
Pembina continues to execute its strategy within a fully funded
model and consistent with its financial guardrails. At December 31,
2024, the ratio of proportionately consolidated debt-to-adjusted
EBITDA on a trailing twelve-month basis was 3.5 times, at the low
end of the Company's targeted range, and reflecting only three
quarters of contribution from the Alliance/Aux Sable Acquisition.
Within the 2025 adjusted EBITDA guidance range, Pembina expects to
generate positive free cash flow, with all 2025 capital investment
program scenarios being fully funded by cash flow from operating
activities, net of dividends. Further, the Company is forecasting a
year-end 2025 proportionately consolidated debt-to-adjusted EBITDA
ratio of 3.3 to 3.6 times.
Projects and New Developments
Pipelines
- In November 2024, the NEBC MPS Expansion was placed into
service on time and under the $90 million budget, adding to
Pembina's record of strong project execution. This expansion
includes a new mid-point pump station, terminal upgrades, and
additional storage, which support approximately 40,000 bpd of
incremental capacity on the NEBC Pipeline system. This expansion
will fulfill customer demand in light of growing production volumes
from NEBC and previously announced long-term midstream service
agreements with three premier NEBC Montney producers.
- Pembina continues to successfully contract the Nipisi Pipeline
to serve growing volumes from the Clearwater area. Pembina recently
contracted an additional 25,000 bbl/d of capacity on a long-term
basis commencing in the first half of 2026 and expects the pipeline
to be highly utilized in 2026. With the expectation of continued
growth from the Clearwater play, Pembina is currently evaluating
opportunities to increase egress capacity, including the
optimization or expansion of the Nipisi Pipeline and the
re-purposing of existing underutilized assets.
- Pembina is developing additional expansions to support growing
WCSB production and demand for services on its conventional
pipelines.
- On April 23, 2024, Pembina filed its project application for
the Taylor-to-Gordondale Project (an expansion of the Pouce Coupe
system) with the Canada Energy Regulator ("CER") and has entered
the assessment phase of the CER's regulatory process with the
hearing scheduled to commence in June 2025.
- Pembina is evaluating an expansion of the Peace Pipeline system
to add up to approximately 200,000 bpd of capacity to its market
delivery pipelines from Fox Creek-to-Namao (the "Fox Creek-to-Namao
Peace Pipeline Expansion"). The current total capacity of the Peace
Pipeline and Northern Pipeline systems is approximately 1.1 million
bpd and Pembina has the ability to through the relatively low-cost
addition of pump stations on these mainlines to bring the total
capacity of these systems to 1.3 million bpd.
- Pembina continues to advance further expansions to support
volume growth in NEBC, including new pipelines and terminal
upgrades.
Facilities
- Pembina is constructing a new 55,000 bpd propane-plus
fractionator ("RFS IV") at its existing Redwater Complex. RFS IV
will leverage the design, engineering and operating best practices
of the existing facilities at the Redwater Complex. Fabrication and
construction activities continued in the fourth quarter of 2024,
while piling and foundation work was completed for the associated
rail yard scope. RFS IV is expected to be in-service in the first
half of 2026 and is trending on time and on budget.
- PGI is developing an expansion (the "Wapiti Expansion") that
will increase natural gas processing capacity at the Wapiti Plant
by 115 mmcf/d (gross to PGI). During the fourth quarter of 2024,
engineering and equipment fabrication progressed and early works
construction commenced. The Wapiti Expansion is expected to be
in-service in the first half of 2026 and is trending on time and on
budget.
- PGI is developing a 28 MW cogeneration facility at its K3 Plant
(the "K3 Cogeneration Facility"), which is expected to reduce
overall operating costs by providing power and heat to the gas
processing facility, while reducing customers’ exposure to power
prices. Early works construction activities have commenced. The K3
Cogeneration Facility is expected to be in-service in the first
half of 2026 and is trending on time and on budget.
- Pembina continues to evaluate the various options available to
meet its ethane supply commitment under the agreement with Dow.
Pembina is seeking to fulfill its commitment in the most capital
efficient manner possible and is evaluating a portfolio of
opportunities, including the addition of a de-ethanizer tower at
RFS III within the Redwater Complex. By leveraging its existing
assets and capabilities, Pembina now expects the total capital
investment required to be less than $300 million, below the low end
of the range previously communicated, resulting in improved capital
efficiency as there is no change to the forecasted adjusted EBITDA
contribution associated with the Dow Supply Agreement.
- Effective October 9, 2024, PGI closed its acquisition from
Veren of four batteries in the Gold Creek and Karr areas. Veren has
entered into a 15 year take-or-pay agreement for capacity at the
acquired batteries, which also includes an area-of-dedication to
PGI for gathering and processing services for all volumes Veren
produces out of the Gold Creek and Karr areas. Liquids from the
batteries and the Patterson Creek Gas Plant will continue to be
transported on Pembina’s Peace Pipeline system and the NGL will be
processed at Pembina’s Redwater Facility under previously
established agreements. As part of this transaction, PGI also
committed to fund capital up to $300 million ($180 million net to
Pembina) for future battery and gathering infrastructure in the
Gold Creek and Karr areas, which is expected to be in service in
the first half of 2026. Separately, during the fourth quarter of
2024, PGI executed a long term, take-or-pay agreement with Veren to
provide approximately 95 MMcf/d of gas processing service in
support of their Duvernay development at PGI's Duvernay and KA
Plants. This further solidifies PGI’s contracted volumes in the
Kaybob area.
- Effective December 31, 2024, PGI closed its acquisition of a 50
percent working interest in Whitecap’s 15-07 Kaybob Complex (the
"Kaybob Complex"). Whitecap entered into a long-term take-or-pay
agreement for PGI’s capacity in the Kaybob Complex and committed to
an area of dedication to PGI for all volumes Whitecap produces out
of the area. Whitecap has also entered into additional long-term
take-or-pay contracts with PGI at the Musreau gas plant within the
Cutbank Complex ("Musreau") and the K3 gas plant. PGI anticipates
funding up to $400 million ($240 million net to Pembina) for future
infrastructure development for Whitecap’s Lator area development,
including a new battery and gathering laterals (the "Lator
Infrastructure"), which is expected to be in service in late 2026 /
early 2027. All NGL produced through the Kaybob Complex and Lator
Infrastructure developments will flow through Pembina’s downstream
infrastructure and are covered under a combination of new and
extended long-term transportation, fractionation, and marketing
services agreements, as well as an area-of-dedication for future
growth.
Marketing & New Ventures
- Pembina and its partner, the Haisla Nation, are constructing
the Cedar LNG Project, a 3.3 million tonnes per annum ("mtpa")
floating LNG facility in Kitimat, British Columbia. Site clearing
and civil works on the marine terminal site commenced in the third
quarter of 2024 and construction of the floating LNG facility is
expected to begin in mid-2025. The anticipated in-service date of
the Cedar LNG Project is in late 2028. Pembina has entered into an
agreement with Cedar LNG for 1.5 mtpa of capacity and previously
acknowledged its intent to remarket that capacity to third parties.
In late 2024, Pembina initiated remarketing discussions with a
broad range of potential customers, including both LNG portfolio
players and Canadian producers. Pembina has received non-binding
proposals covering well in excess of its contracted capacity and is
in the process of shortlisting preferred counterparties to
transition to definitive agreements. The market response received
thus far has been very positive and reflects the de-risking of the
project and the capacity.
Fourth Quarter 2024 Conference Call & Webcast
Pembina will host a conference call on Friday, February 28,
2025, at 8:00 a.m. MT (10:00 a.m. ET) for interested investors,
analysts, brokers and media representatives to discuss results for
the fourth quarter of 2024. The conference call dial-in numbers for
Canada and the U.S. are 1-289-819-1520 or 1-800-549-8228. A
recording of the conference call will be available for replay until
Friday, March 7, 2025, at 11:59 p.m. ET. To access the replay,
please dial either 1-289-819-1325 or 1-888-660-6264 and enter the
password 56189 #.
A live webcast of the conference call can be accessed on
Pembina's website at www.pembina.com under Investor
Centre/Presentations & Events, or by entering:
https://events.q4inc.com/attendee/641370033 in your web browser.
Shortly after the call, an audio archive will be posted on the
website for a minimum of 90 days.
Quarterly Common Share Dividend
Pembina's board of directors has declared a common share cash
dividend for the first quarter of 2025 of $0.69 per share to be
paid, subject to applicable law, on March 31, 2025, to shareholders
of record on March 17, 2025. The common share dividends are
designated as "eligible dividends" for Canadian income tax
purposes. For non-resident shareholders, Pembina's common share
dividends should be considered "qualified dividends" and may be
subject to Canadian withholding tax.
For shareholders receiving their common share dividends in U.S.
funds, the cash dividend is expected to be approximately
U.S.$0.4812 per share (before deduction of any applicable Canadian
withholding tax) based on a currency exchange rate of 0.6974. The
actual U.S. dollar dividend will depend on the Canadian/U.S. dollar
exchange rate on the payment date and will be subject to applicable
withholding taxes.
Quarterly dividend payments are expected to be made on the last
business day of March, June, September and December to shareholders
of record on the 15th day of the corresponding month, if, as and
when declared by the board of directors. Should the record date
fall on a weekend or on a statutory holiday, the record date will
be the next succeeding business day following the weekend or
statutory holiday.
About Pembina
Pembina Pipeline Corporation is a leading energy transportation
and midstream service provider that has served North America's
energy industry for more than 70 years. Pembina owns an extensive
network of strategically-located assets, including hydrocarbon
liquids and natural gas pipelines, gas gathering and processing
facilities, oil and natural gas liquids infrastructure and
logistics services, and an export terminals business. Through our
integrated value chain, we seek to provide safe and reliable energy
solutions that connect producers and consumers across the world,
support a more sustainable future and benefit our customers,
investors, employees and communities. For more information, please
visit www.pembina.com.
Purpose of Pembina: We deliver extraordinary energy solutions so
the world can thrive.
Pembina is structured into three Divisions: Pipelines Division,
Facilities Division and Marketing & New Ventures Division.
Pembina's common shares trade on the Toronto and New York stock
exchanges under PPL and PBA, respectively. For more information,
visit www.pembina.com.
Forward-Looking Statements and Information
This news release contains certain forward-looking statements
and forward-looking information (collectively, "forward-looking
statements"), including forward-looking statements within the
meaning of the "safe harbor" provisions of applicable securities
legislation, that are based on Pembina's current expectations,
estimates, projections and assumptions in light of its experience
and its perception of historical trends. In some cases,
forward-looking statements can be identified by terminology such as
"continue", "anticipate", "schedule", "will", "expects",
"estimate", "potential", "planned", "future", "outlook",
"strategy", "project", "plan", "commit", "maintain", "focus",
"ongoing", "believe" and similar expressions suggesting future
events or future performance.
In particular, this news release contains forward-looking
statements, including certain financial outlooks, pertaining to,
without limitation, the following: Pembina's 2025 guidance,
including anticipated 2025 adjusted EBITDA and year-end 2025
proportionately consolidated debt-to-adjusted EBITDA ratio, as well
as the factors impacting such future results; expected cash flow
from operating activities in 2025 and the uses thereof; future
pipeline, processing, fractionation and storage facility and system
operations and throughput levels; treatment under existing and
potential governmental policies and regulations, including
expectations regarding their impact on Pembina; Pembina's strategy
and the development of new business initiatives and growth
opportunities, including the anticipated benefits therefrom and the
expected timing thereof; expectations about current and future
market conditions, industry activities and development
opportunities, as well as the anticipated benefits thereof,
including general market conditions outlooks and industry
developments; expectations about future demand for Pembina's
infrastructure and services, including expectations in respect of
customer contracts, future volume growth in the WCSB and the
drivers thereof, increased utilization and future tolls and
volumes; expectations relating to the development of Pembina's new
projects and developments, including the Cedar LNG Project, RFS IV,
the Wapiti Expansion, the K3 Cogeneration Facility, the Greenlight
Electricity Centre and the Yellowhead Mainline Extraction project,
including the outcomes, timing and anticipated benefits thereof;
statements regarding commercial discussions regarding the
assignment of Pembina's contracted capacity for the Cedar LNG
Project, including the timing and results thereof; expectations in
respect of PGI's infrastructure development commitments, including
the amounts and timing thereof; statements regarding optimization
and expansion opportunities being evaluated or pursued by Pembina,
including future actions taken by Pembina in connection with such
opportunities and the outcomes thereof; Pembina's future common
share dividends, including the timing, amount and expected tax
treatment thereof; planning, construction, locations, capital
expenditure and funding estimates, schedules, regulatory and
environmental applications and anticipated approvals, expected
capacity, incremental volumes, contractual arrangements, completion
and in-service dates, sources of product, activities, benefits and
operations with respect to new construction of, or expansions on
existing pipelines, systems, gas services facilities, processing
and fractionation facilities, terminalling, storage and hub
facilities and other facilities or energy infrastructure, as well
as the impact of Pembina's new projects on its future financial
performance; and expectations regarding existing and future
commercial agreements, including the expected timing and benefit
thereof.
The forward-looking statements are based on certain factors and
assumptions that Pembina has made in respect thereof as at the date
of this news release regarding, among other things: oil and gas
industry exploration and development activity levels and the
geographic region of such activity; the success of Pembina's
operations; prevailing commodity prices, interest rates, carbon
prices, tax rates, exchange rates and inflation rates; the ability
of Pembina to maintain current credit ratings; the availability and
cost of capital to fund future capital requirements relating to
existing assets, projects and the repayment or refinancing of
existing debt as it becomes due; future operating costs;
geotechnical and integrity costs; that any third-party projects
relating to Pembina's growth projects will be sanctioned and
completed as expected; assumptions with respect to our intention to
complete share repurchases, including the funding thereof, existing
and future market conditions, including with respect to Pembina's
common share trading price, and compliance with respect to
applicable securities laws and regulations and stock exchange
policies; that any required commercial agreements can be reached in
the manner and on the terms expected by Pembina; that all required
regulatory and environmental approvals can be obtained on
acceptable terms and in a timely manner; that counterparties will
comply with contracts in a timely manner; that there are no
unforeseen events preventing the performance of contracts or the
completion of the relevant projects; prevailing regulatory, tax and
environmental laws and regulations; maintenance of operating
margins; the amount of future liabilities relating to lawsuits and
environmental incidents; and the availability of coverage under
Pembina's insurance policies (including in respect of Pembina's
business interruption insurance policy).
Although Pembina believes the expectations and material factors
and assumptions reflected in these forward-looking statements are
reasonable as of the date hereof, there can be no assurance that
these expectations, factors and assumptions will prove to be
correct. These forward-looking statements are not guarantees of
future performance and are subject to a number of known and unknown
risks and uncertainties including, but not limited to: the
regulatory environment and decisions, including the outcome of
regulatory hearings, and Indigenous and landowner consultation
requirements; the impact of competitive entities and pricing;
reliance on third parties to successfully operate and maintain
certain assets; reliance on key relationships, joint venture
partners and agreements; labour and material shortages; the
strength and operations of the oil and natural gas production
industry and related commodity prices; non-performance or default
by contractual counterparties ; actions by governmental or
regulatory authorities, including changes in laws and treatment
(including uncertainty with respect to the interpretation of the
recently enacted Bill C-59 and related amendments to the
Competition Act (Canada)), changes in royalty rates, regulatory
decisions, changes in regulatory processes or increased
environmental regulation; the ability of Pembina to acquire or
develop the necessary infrastructure in respect of future
development projects; Pembina's ability to realize the anticipated
benefits of recent acquisitions; fluctuations in operating results;
adverse general economic and market conditions, including potential
recessions in Canada, North America and worldwide resulting in
changes, or prolonged weaknesses, as applicable, in interest rates,
foreign currency exchange rates, inflation, commodity prices,
supply/demand trends and overall industry activity levels; new
Canadian and/or U.S. trade policies or barriers, including the
imposition of new tariffs, duties or other trade restrictions;
constraints on the, or the unavailability of, adequate supplies,
infrastructure or labour; the political environment in North
American and elsewhere, including changes in trade relations
between Canada and the U.S., and public opinion thereon; the
ability to access various sources of debt and equity capital;
adverse changes in credit ratings; counterparty credit risk;
technology and cyber security risks; natural catastrophes; and
certain other risks detailed in Pembina's Annual Information Form
and Management's Discussion and Analysis, each dated February 27,
2025 for the year ended December 31, 2024 and from time to time in
Pembina's public disclosure documents available at
www.sedarplus.ca, www.sec.gov and through Pembina's website at
www.pembina.com.
This list of risk factors should not be construed as exhaustive.
Readers are cautioned that events or circumstances could cause
results to differ materially from those predicted, forecasted or
projected by forward-looking statements contained herein. The
forward-looking statements contained in this news release speak
only as of the date of this news release. Pembina does not
undertake any obligation to publicly update or revise any
forward-looking statements or information contained herein, except
as required by applicable laws. Management approved the 2025
guidance contained herein on December 12, 2024. The purpose of the
2025 guidance is to assist readers in understanding Pembina's
expected and targeted financial results, and this information may
not be appropriate for other purposes. The forward-looking
statements contained in this news release are expressly qualified
by this cautionary statement.
Non-GAAP and Other Financial Measures
Throughout this news release, Pembina has disclosed certain
financial measures and ratios that are not specified, defined or
determined in accordance with GAAP and which are not disclosed in
Pembina's financial statements. Non-GAAP financial measures either
exclude an amount that is included in, or include an amount that is
excluded from, the composition of the most directly comparable
financial measure specified, defined and determined in accordance
with GAAP. Non-GAAP ratios are financial measures that are in the
form of a ratio, fraction, percentage or similar representation
that has a non-GAAP financial measure as one or more of its
components. These non-GAAP financial measures and non-GAAP ratios,
together with financial measures and ratios specified, defined and
determined in accordance with GAAP, are used by management to
evaluate the performance and cash flows of Pembina and its
businesses and to provide additional useful information respecting
Pembina's financial performance and cash flows to investors and
analysts.
In this news release, Pembina has disclosed the following
non-GAAP financial measures and non-GAAP ratios: net revenue,
adjusted EBITDA, adjusted EBITDA from equity accounted investees,
adjusted cash flow from operating activities, adjusted cash flow
from operating activities per common share, and proportionately
consolidated debt-to-adjusted EBITDA. The non-GAAP financial
measures and non-GAAP ratios disclosed in this news release do not
have any standardized meaning under International Financial
Reporting Standards ("IFRS") and may not be comparable to similar
financial measures or ratios disclosed by other issuers. Such
financial measures and ratios should not, therefore, be considered
in isolation or as a substitute for, or superior to, measures and
ratios of Pembina's financial performance, or cash flows specified,
defined or determined in accordance with IFRS, including revenue,
earnings, cash flow from operating activities and cash flow from
operating activities per share.
Except as otherwise described herein, these non-GAAP financial
measures and non-GAAP ratios are calculated on a consistent basis
from period to period. Specific reconciling items may only be
relevant in certain periods.
Below is a description of each non-GAAP financial measure and
non-GAAP ratio disclosed in this news release, together with, as
applicable, disclosure of the most directly comparable financial
measure that is determined in accordance with GAAP to which each
non-GAAP financial measure relates and a quantitative
reconciliation of each non-GAAP financial measure to such directly
comparable GAAP financial measure. Additional information relating
to such non-GAAP financial measures and non-GAAP ratios, including
disclosure of the composition of each non-GAAP financial measure
and non-GAAP ratio, an explanation of how each non-GAAP financial
measure and non-GAAP ratio provides useful information to investors
and the additional purposes, if any, for which management uses each
non-GAAP financial measure and non-GAAP ratio; an explanation of
the reason for any change in the label or composition of each
non-GAAP financial measure and non-GAAP ratio from what was
previously disclosed; and a description of any significant
difference between forward-looking non-GAAP financial measures and
the equivalent historical non-GAAP financial measures, is contained
in the "Non-GAAP & Other Financial Measures" section of the
management's discussion and analysis of Pembina dated February 27,
2025 for the year ended December 31, 2024 (the "MD&A"), which
information is incorporated by reference in this news release. The
MD&A is available on SEDAR+ at www.sedarplus.ca, EDGAR at
www.sec.gov and Pembina's website at www.pembina.com.
Net Revenue
Net revenue is a non-GAAP financial measure which is defined as
total revenue less cost of goods. The most directly comparable
financial measure to net revenue that is determined in accordance
with GAAP and disclosed in Pembina's financial statements is
revenue.
3 Months Ended December 31
Pipelines
Facilities
Marketing & New
Ventures(1)
Corporate &
Inter-segment
Eliminations
Total(1)
($ millions)
2024
2023
2024
2023
2024
2023
2024
2023
2024
2023
Revenue
948
737
320
248
1,133
1,030
(256)
(179)
2,145
1,836
Cost of goods sold
5
11
—
—
919
821
(162)
(138)
762
694
Net revenue
943
726
320
248
214
209
(94)
(41)
1,383
1,142
12 Months Ended December 31
Pipelines
Facilities
Marketing & New
Ventures(1)
Corporate &
Inter-segment
Eliminations
Total(1)
($ millions)
2024
2023
2024
2023
2024
2023
2024
2023
2024
2023
Revenue
3,386
2,707
1,127
909
3,796
3,293
(925)
(578)
7,384
6,331
Cost of goods sold
40
17
—
—
3,198
2,736
(630)
(395)
2,608
2,358
Net revenue
3,346
2,690
1,127
909
598
557
(295)
(183)
4,776
3,973
(1)
Comparative 2023 period has been
adjusted. See "Accounting Policies & Estimates - Change in
Accounting Policies" in Pembina's Management's Discussion and
Analysis dated February 27, 2025 for the three and twelve months
ended December 31, 2024 and Note 4 to the Consolidated Financial
Statements for the year ended December 31, 2024.
Adjusted Earnings Before Interest, Taxes,
Depreciation and Amortization
Adjusted EBITDA is a non-GAAP financial measure and is
calculated as earnings before net finance costs, income taxes,
depreciation and amortization (included in operations and general
and administrative expense), and unrealized gains or losses from
derivative instruments. The exclusion of unrealized gains or losses
from derivative instruments eliminates the non-cash impact of such
gains or losses.
Adjusted EBITDA also includes adjustments to earnings for
non-controlling interest, losses (gains) on disposal of assets,
transaction costs incurred in respect of acquisitions, dispositions
and restructuring, impairment charges or reversals in respect of
goodwill, intangible assets, investments in equity accounted
investees and property, plant and equipment, certain non-cash
provisions and other amounts not reflective of ongoing operations.
These additional adjustments are made to exclude various non-cash
and other items that are not reflective of ongoing operations.
Following completion of the Alliance/Aux Sable Acquisition,
Pembina revised the definition of adjusted EBITDA to deduct
earnings for the 14.6 percent non-controlling interest in the Aux
Sable U.S. operations. Pembina's subsequent acquisition of the
remaining interest in Aux Sable's U.S. operations in the third
quarter of 2024 resulted in all of Aux Sable's results being
included in the adjusted EBITDA calculation beginning on August 1,
2024.
3 Months Ended December 31
Pipelines
Facilities
Marketing &
New Ventures
Corporate &
Inter-segment
Eliminations
Total
($ millions, except per share amounts)
2024
2023
2024
2023
2024
2023
2024
2023
2024
2023
Earnings (loss)
534
677
177
143
245
204
(212)
(209)
572
698
Income tax expense
—
—
—
—
—
—
—
—
172
117
Adjustments to share of profit from equity
accounted investees and other
—
45
136
135
(74)
6
—
—
62
186
Net finance costs (income)
5
6
2
3
5
(4)
151
111
163
116
Depreciation and amortization
148
109
55
46
17
12
15
11
235
178
Unrealized loss (gain) from derivative
instruments
—
—
—
—
41
(46)
—
—
41
(46)
Impairment reversal
—
(231)
—
—
—
—
—
—
—
(231)
Transaction and integration costs in
respect of acquisitions
—
—
—
—
—
—
7
2
7
2
Gain on disposal of assets, other non-cash
provisions, and other
(1)
11
3
(3)
—
1
—
4
2
13
Adjusted EBITDA
686
617
373
324
234
173
(39)
(81)
1,254
1,033
Adjusted EBITDA per common share – basic
(dollars)
2.16
1.87
12 Months Ended December 31
Pipelines
Facilities
Marketing &
New Ventures
Corporate &
Inter-segment
Eliminations
Total
($ millions, except per share amounts)
2024
2023
2024
2023
2024
2023
2024
2023
2024
2023
Earnings (loss)
1,907
1,840
666
610
569
435
(1,422)
(696)
1,874
1,776
Income tax (recovery) expense
—
—
—
—
—
—
—
—
(154)
413
Adjustments to share of profit (loss) from
equity accounted investees and other
46
172
486
438
(16)
84
—
—
516
694
Net finance costs
24
28
10
9
9
4
518
425
561
466
Depreciation and amortization
560
414
183
159
64
46
55
44
862
663
Unrealized loss from derivative
instruments
—
—
—
—
170
32
—
—
170
32
Non-controlling interest(1)
—
—
—
—
(12)
—
—
—
(12)
—
Loss on Alliance/Aux Sable Acquisition
—
—
—
—
—
—
616
—
616
—
Impairment reversal
—
(231)
—
—
—
—
—
—
—
(231)
Transaction and integration costs in
respect of acquisition
—
—
—
—
—
—
25
2
25
2
Derecognition of insurance contract
provision
—
—
—
—
(34)
—
—
—
(34)
—
Gain on disposal of assets, other non-cash
provisions, and other
(4)
11
2
(3)
(26)
(4)
12
5
(16)
9
Adjusted EBITDA
2,533
2,234
1,347
1,213
724
597
(196)
(220)
4,408
3,824
Adjusted EBITDA per common share – basic
(dollars)
7.69
6.95
(1)
Presented net of adjusting
items.
Adjusted EBITDA from Equity Accounted
Investees
In accordance with IFRS, Pembina's jointly controlled
investments are accounted for using equity accounting. Under equity
accounting, the assets and liabilities of the investment are
presented net in a single line item in the Consolidated Statement
of Financial Position, "Investments in Equity Accounted Investees".
Net earnings from investments in equity accounted investees are
recognized in a single line item in the Consolidated Statement of
Earnings and Comprehensive Income "Share of Profit from Equity
Accounted Investees". The adjustments made to earnings, in adjusted
EBITDA above, are also made to share of profit from investments in
equity accounted investees. Cash contributions and distributions
from investments in equity accounted investees represent Pembina's
share paid and received in the period to and from the investments
in equity accounted investees.
To assist in understanding and evaluating the performance of
these investments, Pembina is supplementing the IFRS disclosure
with non-GAAP proportionate consolidation of Pembina's interest in
the investments in equity accounted investees. Pembina's
proportionate interest in equity accounted investees has been
included in adjusted EBITDA.
3 Months Ended December 31
Pipelines
Facilities
Marketing &
New Ventures
Total
($ millions)
2024
2023
2024
2023
2024
2023
2024
2023
Share of profit from equity accounted
investees
—
31
59
48
74
15
133
94
Adjustments to share of profit from equity
accounted investees:
Net finance costs (income)
—
7
37
84
(74)
—
(37)
91
Income tax expense (recovery)
—
—
23
(13)
—
—
23
(13)
Depreciation and amortization
—
38
66
60
—
6
66
104
Unrealized (gain) loss on
commodity-related derivative financial instruments
—
—
(3)
7
—
—
(3)
7
Transaction costs incurred in respect of
acquisitions and non-cash provisions
—
—
13
(3)
—
—
13
(3)
Total adjustments to share of profit from
equity accounted investees
—
45
136
135
(74)
6
62
186
Adjusted EBITDA from equity accounted
investees
—
76
195
183
—
21
195
280
12 Months Ended December 31
Pipelines
Facilities
Marketing &
New Ventures
Total
($ millions)
2024
2023
2024
2023
2024
2023
2024
2023
Share of profit (loss) from equity
accounted investees
42
109
231
233
55
(26)
328
316
Adjustments to share of profit (loss) from
equity accounted investees:
Net finance costs (income)
7
22
175
160
(23)
1
159
183
Income tax expense
—
—
73
41
—
—
73
41
Depreciation and amortization
39
150
221
207
7
25
267
382
Unrealized loss on commodity-related
derivative financial instruments
—
—
2
16
—
—
2
16
Transaction costs incurred in respect of
acquisitions and non-cash provisions
—
—
15
14
—
58
15
72
Total adjustments to share of profit from
equity accounted investees
46
172
486
438
(16)
84
516
694
Adjusted EBITDA from equity accounted
investees
88
281
717
671
39
58
844
1,010
Adjusted Cash Flow from Operating
Activities and Adjusted Cash Flow from Operating Activities per
Common Share
Adjusted cash flow from operating activities is a non-GAAP
financial measure which is defined as cash flow from operating
activities adjusting for the change in non-cash operating working
capital, adjusting for current tax and share-based compensation
payment, and deducting distributions to non-controlling interest
and preferred share dividends paid. Adjusted cash flow from
operating activities deducts distributions to non-controlling
interest and preferred share dividends paid because they are not
attributable to common shareholders. The calculation has been
modified to include current tax and share-based compensation
payment as it allows management to better assess the obligations
discussed below.
Following completion of the Alliance/Aux Sable Acquisition,
Pembina revised the definition of adjusted cash flow from operating
activities to deduct distributions related to non-controlling
interest in the Aux Sable U.S. operations. On August 1, 2024,
Pembina acquired the remaining interest in Aux Sable's U.S.
operations.
Management believes that adjusted cash flow from operating
activities provides comparable information to investors for
assessing financial performance during each reporting period.
Management utilizes adjusted cash flow from operating activities to
set objectives and as a key performance indicator of the Company's
ability to meet interest obligations, dividend payments and other
commitments.
Adjusted cash flow from operating activities per common share is
a non-GAAP ratio which is calculated by dividing adjusted cash flow
from operating activities by the weighted average number of common
shares outstanding.
3 Months Ended December
31
12 Months Ended December
31
($ millions, except per share amounts)
2024
2023
2024
2023
Cash flow from operating activities
902
880
3,214
2,635
Cash flow from operating activities per
common share – basic (dollars)
1.55
1.60
5.61
4.79
Add (deduct):
Change in non-cash operating working
capital
73
(54)
43
210
Current tax expense
(73)
(54)
(261)
(325)
Taxes paid, net of foreign exchange
52
49
404
236
Accrued share-based payment expense
(3)
(44)
(82)
(67)
Share-based compensation payment
5
—
91
77
Preferred share dividends paid
(34)
(30)
(132)
(120)
Distributions to non-controlling
interest
—
—
(12)
—
Adjusted cash flow from operating
activities
922
747
3,265
2,646
Adjusted cash flow from operating
activities per common share – basic (dollars)
1.59
1.36
5.70
4.81
Proportionately Consolidated
Debt-to-Adjusted EBITDA
Proportionately Consolidated Debt-to-Adjusted EBITDA is a
non-GAAP ratio that management believes is useful to investors and
other users of Pembina’s financial information in the evaluation of
the Company’s debt levels and creditworthiness.
As at December 31
($ millions, except as noted)
2024
2023
Loans and borrowings (current)
1,525
650
Loans and borrowings (non-current)
10,535
9,253
Loans and borrowings of equity accounted
investees
3,333
2,805
Proportionately consolidated debt
15,393
12,708
Adjusted EBITDA
4,408
3,824
Proportionately consolidated
debt-to-adjusted EBITDA (times)
3.5
3.3
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250227832623/en/
For further information: Investor Relations (403) 231-3156
1-855-880-7404 e-mail: investor-relations@pembina.com
www.pembina.com
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