Cheniere Energy, Inc. Quarterly Report for Q1 Ended Mar 31, 2024

Summary

Cheniere Energy, Inc. (LNG) reported a significant decrease in net income attributable to Cheniere for the first quarter of 2024 compared to the same period in 2023. This decline was primarily driven by unfavorable changes in the fair value and settlements of derivative instruments, particularly the non-recurrence of a substantial gain recognized in Q1 2023 related to IPM agreements, which was largely due to moderating international gas price volatility. Additionally, a decrease in LNG revenues, net of cost of sales and excluding derivatives, contributed to the decline, largely due to lower margins on LNG delivered and a decrease in revenue from marketing operations under short-term agreements. Despite the lower net income, the company demonstrated strong operational cash flow generation and a robust liquidity position. Capital expenditures remained focused on the Corpus Christi Stage 3 Project. Financially, Cheniere issued new senior notes and used the proceeds to retire existing notes, and continued its share repurchase program and dividend payments, reflecting a commitment to capital allocation priorities. The company remains a leading LNG producer with substantial long-term contracted capacity.

Key Highlights

• 1Net income attributable to Cheniere decreased significantly from $5.434 billion in Q1 2023 to $502 million in Q1 2024, primarily due to derivative impacts and lower LNG revenues.
• 2Total revenues declined from $7.310 billion in Q1 2023 to $4.253 billion in Q1 2024, driven by a $3.054 billion decrease in LNG revenues.
• 3Operating cash flow remained strong at $1.246 billion in Q1 2024, though lower than $3.421 billion in Q1 2023, with the decrease attributed to lower cash receipts from LNG sales.
• 4Cheniere issued $1.5 billion of 5.650% Senior Notes due 2034 and used the proceeds to retire $1.5 billion of CCH's 5.875% Senior Secured Notes due 2025.
• 5The company repurchased approximately 7.5 million shares of common stock for $1.2 billion and paid dividends totaling $105 million during the quarter.
• 6Construction on the Corpus Christi Stage 3 Project is 55.9% complete, with expected substantial completion between the second half of 2025 and the first half of 2026.
• 7The company maintains a strong liquidity position with over $12.4 billion in total available liquidity as of March 31, 2024.

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