Kinder Morgan Announces 2015 Financial Expectations; Expects to Declare Dividends of $2.00 Per Share With Over $500 Million o...
04 December 2014 - 7:20AM
Business Wire
Kinder Morgan, Inc. (NYSE: KMI) today announced its preliminary
2015 financial projections. KMI expects to declare dividends of
$2.00 per share for 2015, an approximately 16 percent increase over
the 2014 dividend budget of $1.72 per share.
Chairman and CEO Richard D. Kinder stated, “We believe the
recently closed transaction merging the Kinder Morgan companies
paves the way for superior growth at KMI for years to come. We
anticipate strong growth in 2015 across our pipeline and storage
businesses and currently have a backlog of approximately $18
billion in expansion projects and joint venture investments that
have a high certainty of completion. We are generating strong
growth even though we have revised our projected West Texas
Intermediate (WTI) crude oil price to $70 per barrel. As our track
record demonstrates, we own and operate a large, diversified
portfolio of stable, primarily fee-based energy assets across North
America which produce substantial cash flow in virtually all types
of market conditions, regardless of commodity prices.”
KMI’s growth in 2015 is expected to be driven by continued high
demand for North American energy infrastructure, including the
transportation and storage of natural gas, natural gas liquids,
crude oil and refined products. Additionally, growth is expected to
be driven by contributions from our expansion projects across
Kinder Morgan’s business units.
For 2015, KMI expects to:
- Generate approximately $8.2 billion in
business segment earnings before DD&A (adding back KMI’s share
of joint venture DD&A).
- Declare over $4.4 billion in dividends
to its shareholders.
- Generate additional cash of over $500
million in excess of its dividend.
- Invest approximately $4.4 billion in
expansions (including contributions to joint ventures) and small
acquisitions.
- Finish the year with a Debt to EBITDA
ratio of 5.6 times.
As noted above, KMI’s expectations assume an average WTI crude
oil price of approximately $70 per barrel in 2015. The overwhelming
majority of cash generated by KMI’s assets is fee based and is not
sensitive to commodity prices. In its CO2 segment, the company
hedges the majority of its oil production, but does have exposure
to unhedged volumes, a significant portion of which are natural gas
liquids. For 2015, the company expects that every $1 change in the
average WTI crude oil price per barrel will impact the CO2 segment
by approximately $7 million pre tax, or approximately 0.086
percent of KMI’s combined business segments’ anticipated segment
earnings before DD&A.
The KMI board of directors will review and approve the 2015
budget at the January board meeting and the budgets will be
discussed in detail during the company’s annual analyst meeting on
Jan. 28, 2015, in Houston. Kinder Morgan remains committed to
transparency and will continue to publish its budgets on the
company’s web site, www.kindermorgan.com. The 2015 budget will be
the standard by which KMI measures its performance next year, and
will be a target for determining employee bonuses.
Kinder Morgan, Inc. (NYSE: KMI) is the largest energy
infrastructure company in North America. It owns an interest in or
operates approximately 80,000 miles of pipelines and
180 terminals. The company’s pipelines transport natural gas,
gasoline, crude oil, CO2 and other products, and its terminals
store petroleum products and chemicals, and handle bulk materials
like coal and petroleum coke. Kinder Morgan is the largest
midstream and third largest energy company in North America with an
enterprise value of more than $125 billion. For more
information please visit www.kindermorgan.com.
This news release includes forward-looking statements. These
forward-looking statements are subject to risks and uncertainties
and are based on the beliefs and assumptions of management, based
on information currently available to them. Although Kinder Morgan
believes that these forward-looking statements are based on
reasonable assumptions, it can give no assurance that such
assumptions will materialize. Important factors that could cause
actual results to differ materially from those in the
forward-looking statements herein include those enumerated in
Kinder Morgan’s reports filed with the Securities and Exchange
Commission. Forward-looking statements speak only as of the date
they were made, and except to the extent required by law, Kinder
Morgan undertakes no obligation to update or review any
forward-looking statement because of new information, future events
or other factors. Because of these uncertainties, readers should
not place undue reliance on these forward-looking statements.
Kinder Morgan, Inc.Media RelationsLarry Pierce,
713-369-9407larry_pierce@kindermorgan.comorInvestor
Relations713-369-9490km_ir@kindermorgan.comwww.kindermorgan.com