Summary
Kinder Morgan, Inc. (KMI) reported a net loss of $73 million, or $0.01 per share, for the first quarter of 2012. This loss was primarily driven by a significant $428 million non-cash loss on the remeasurement of KMP's FTC Natural Gas Pipelines disposal group to fair value, which was classified as discontinued operations. Excluding this item, income from continuing operations was $305 million, or $0.03 per share, showing a substantial increase from the $150 million in the prior year's comparable quarter. Total revenues decreased slightly to $1.86 billion from $1.93 billion year-over-year. The company is in the process of acquiring El Paso Corporation (EP), with shareholder approvals obtained and the merger expected to close by the end of May 2012. As a condition for regulatory approval of the EP acquisition, KMI must divest certain KMP assets, which were designated as "assets held for sale" and resulted in the aforementioned loss. The company's financial position remains solid, with significant liquidity available through its credit facilities, despite increased debt related to the pending EP acquisition financing. Overall, while the reported net loss is impacted by a one-time non-cash charge, the underlying performance from continuing operations shows considerable improvement, driven by strong results in the CO2, Natural Gas Pipelines, and Terminals segments. Investors should closely monitor the successful integration of the EP acquisition and the timely divestiture of the required KMP assets.
Financial Highlights
44 data points| Revenue | $1.86B |
| Cost of Revenue | $580.00M |
| Gross Profit | $1.28B |
| Operating Expenses | $1.34B |
| Operating Income | $516.00M |
| Interest Expense | $179.00M |
| Net Income | $21.00M |
Key Highlights
- 1Reported a net loss of $73 million ($0.01 per share) for Q1 2012, heavily influenced by a $428 million non-cash loss from discontinued operations related to the divestiture of KMP's FTC Natural Gas Pipelines disposal group.
- 2Income from continuing operations increased significantly to $305 million ($0.03 per share) in Q1 2012, up from $150 million ($0.11 per share) in Q1 2011.
- 3Total revenues for Q1 2012 were $1.86 billion, a slight decrease from $1.93 billion in Q1 2011.
- 4The acquisition of El Paso Corporation (EP) is nearing completion, expected by the end of May 2012, following shareholder approvals.
- 5As a condition for the EP acquisition's regulatory approval, Kinder Morgan must divest certain KMP assets, which has been accounted for as "assets held for sale" and led to the significant loss on remeasurement.
- 6Total segment EBDA (Earnings Before Depreciation, Depletion, and Amortization) increased by 15% to $971 million in Q1 2012, driven by strong performance in the CO2, Natural Gas Pipelines, and Terminals segments.
- 7Liquidity remains strong, with significant borrowing capacity available under KMI's and KMP's revolving credit facilities, totaling approximately $2.17 billion in available capacity.