Summary
Kinder Morgan, Inc. (KMI) reported a net loss of $637 million, or $0.28 per diluted share, for the second quarter of 2020, a significant shift from a net income of $518 million, or $0.23 per diluted share, in the same period of 2019. This downturn was largely driven by substantial non-cash impairment charges totaling $1.976 billion, primarily related to goodwill in its Natural Gas Pipelines Non-Regulated and CO2 segments, reflecting the adverse impact of the COVID-19 pandemic and depressed commodity prices on the energy sector. Despite the reported net loss, the company's operational performance, as indicated by Adjusted EBITDA, remained robust, reaching $1.568 billion for the quarter, though down from $1.817 billion in Q2 2019. The company reaffirmed its commitment to shareholder returns by declaring a quarterly dividend of $0.2625 per share, a slight increase from the prior year, though lower than originally planned for 2020, indicating a focus on preserving financial flexibility amidst ongoing market uncertainty. KMI also provided an updated 2020 outlook, expecting Distributable Cash Flow (DCF) and Adjusted EBITDA to be below original plans by over 10% and 8%, respectively. However, the company maintained a strong liquidity position with approximately $3.9 billion available under its credit facility.
Financial Highlights
50 data points| Revenue | $2.56B |
| Cost of Revenue | $441.00M |
| Gross Profit | $2.12B |
| Operating Expenses | $2.84B |
| Operating Income | -$282.00M |
| Net Income | -$637.00M |
| EPS (Basic) | $-0.28 |
| EPS (Diluted) | $-0.28 |
| Shares Outstanding (Basic) | 2.26B |
| Shares Outstanding (Diluted) | 2.26B |
Key Highlights
- 1Reported a net loss of $637 million for Q2 2020, a significant decrease from a net income of $518 million in Q2 2019, primarily due to $1.976 billion in impairment charges (goodwill and long-lived assets).
- 2Adjusted EBITDA remained strong at $1.568 billion for Q2 2020, though down from $1.817 billion in Q2 2019, indicating resilient underlying operational performance despite impairments.
- 3The company updated its 2020 outlook, now expecting Distributable Cash Flow (DCF) to be over 10% below plan and Adjusted EBITDA to be over 8% below plan, reflecting the ongoing impact of the pandemic and commodity price volatility.
- 4Kinder Morgan declared a quarterly dividend of $0.2625 per share, a 5% increase year-over-year, demonstrating continued commitment to shareholder returns while managing financial flexibility.
- 5Liquidity remains strong with approximately $3.9 billion available under its revolving credit facility as of June 30, 2020.
- 6Revenues for the quarter decreased to $2.560 billion from $3.214 billion in the prior year's quarter, impacted by lower commodity sales and service revenues across segments due to reduced energy demand.