Summary
Kinder Morgan, Inc. (KMI) reported revenues of $3.37 billion for the second quarter of 2017, a 7% increase compared to the same period in 2016, driven primarily by higher natural gas sales and product sales. Net income available to common stockholders was $337 million ($0.15 per share) for the quarter, a slight increase from $333 million ($0.15 per share) in Q2 2016. The company successfully paid down debt, reducing its long-term debt by $2.2 billion compared to the end of 2016, largely due to proceeds from the KML IPO and other asset sales. The company also announced a $2 billion share buyback program expected to begin in 2018, signaling confidence in its financial position and commitment to returning value to shareholders.
Financial Highlights
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Financial Statements
Beta
| Revenue | $3.37B |
| Cost of Revenue | $1.09B |
| Gross Profit | $2.28B |
| Operating Expenses | $2.45B |
| Operating Income | $918.00M |
| Net Income | $376.00M |
| EPS (Basic) | $0.15 |
| EPS (Diluted) | $0.15 |
| Shares Outstanding (Basic) | 2.23B |
| Shares Outstanding (Diluted) | 2.23B |
Key Highlights
- 1Total revenues increased by 7% year-over-year to $3.37 billion for the second quarter of 2017.
- 2Net income available to common stockholders increased slightly to $337 million ($0.15 per share) from $333 million ($0.15 per share) in the prior year quarter.
- 3Long-term debt was reduced by $2.2 billion during the first six months of 2017, ending at $34.0 billion.
- 4The company completed an IPO for its Canadian subsidiary, KML, raising approximately $1.3 billion, which was used to pay down debt.
- 5Kinder Morgan announced a new $2 billion share buyback program, commencing in 2018.
- 6Segment EBDA (Earnings Before Depreciation, Depletion, and Amortization) showed mixed results across segments, with Natural Gas Pipelines down 6% while Products Pipelines and Terminals saw modest increases.
- 7The company continues to face legal and environmental contingencies, though management believes the ultimate resolution will not materially adversely impact the business.
Frequently Asked Questions
Revenue growth in the second quarter of 2017 was primarily driven by an increase in Natural Gas sales and Product sales and other categories, as detailed in the Consolidated Statements of Income.
Kinder Morgan significantly reduced its long-term debt by $2.2 billion during the first six months of 2017, ending at $34.0 billion. This reduction was primarily funded by proceeds from the KML IPO and other debt paydowns.
The IPO of Kinder Morgan Canada Limited (KML) raised approximately $1.3 billion in proceeds, which were used to pay down debt. This transaction also resulted in KMI retaining a 70% interest in its Canadian business, with the public holding the remaining 30%, reflected as noncontrolling interests.
Kinder Morgan announced a $2 billion share buyback program expected to begin in 2018, indicating a commitment to shareholder returns. Additionally, the company reiterated its dividend payment plans and provided guidance for future dividend increases.