Skip to content
AnalystLens

Plains All American Pipeline 8-K Report, Financial Results (Feb 7, 2025)

Reports
Earnings & Results·Regulation FD·Exhibits & Filings
Filing Date
Filed February 7, 2025
Period End
February 7, 2025
Securities
PAAPAAPU
In the record · 2016–202610-K1110-Q328-K168

PAA filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 168 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Oct ’17Oct ’17
  2. Leadership change8-K · Sep ’20Sep ’20
  3. Material agreement8-K · Aug ’22Aug ’22
  4. Leadership change8-K · Sep ’26Sep ’26

01—Abstract

Summary

Summary of the 8-K filed February 7, 2025. Cited figures are marked; the original filing is the authoritative source.

Plains All American Pipeline, L.P.

(Nasdaq: PAA) and Plains GP Holdings (Nasdaq: PAGP) reported fourth-quarter and full-year 2024 results on February 7, 2025, and furnished the press release as Exhibit 99.1. For the fourth quarter, net income attributable to PAA was $36 milliona versus $312 million a year earlier, and diluted net income per common unit was $(0.04). The quarter absorbed a $225 million charge from the write-off of a receivable for Line 901 insurance proceeds and $140 million of non-cash charges tied to the write-down of two U.S. NGL terminals.

Full-year 2024 net income attributable to PAA was $772 millionb, and Adjusted EBITDA attributable to PAA was $2.78 billion, above the top end of guidance. Full-year net cash provided by operating activities was $2.49 billion, and Adjusted Free Cash Flow was $1.17 billion excluding changes in assets and liabilities, with leverage ending the year at 3.0x. The company also described its efficient growth initiatives, including closing three bolt-on acquisitions for approximately $670 million net to PAA (including Ironwood Midstream Energy) and purchasing about 12.7 million Series A Preferred Units for roughly $330 million.

For 2025, management guides to Adjusted EBITDA attributable to PAA of $2.80 to $2.95 billionc, and expects Adjusted Free Cash Flow of approximately $1.15 billion, reduced by about $580 million for bolt-on transactions closed in the first quarter. Growth capital is expected at +/- $400 million and maintenance capital at +/- $240 million, net to PAA. A distribution increase of $0.25 per unit, payable February 14, 2025, implies a new annual distribution of $1.52 per unit, which the filing describes as a 20% aggregate increase.

Balance sheet actions included a $1 billiond senior unsecured notes offering in January 2025 at 5.95% due 2035. Management anticipates leverage at or below the low end of its 3.25x to 3.75x target range. The filing also notes that the Crude Oil segment's Adjusted EBITDA rose 1% in the quarter while the NGL segment's fell 9%, reflecting lower weighted average frac spreads.

02—Key points

Key Highlights

  1. Q4 2024 net income attributable to PAA of $36 million, down from $312 million, with diluted net income per common unit of $(0.04) versus $0.35 a year earlier.
  2. Q4 2024 results include a $225 million charge for the write-off of a Line 901 insurance proceeds receivable and $140 million of non-cash write-downs on two U.S. NGL terminals.
  3. Full-year 2024 Adjusted EBITDA attributable to PAA of $2.78 billion, above the top end of guidance; full-year Adjusted Free Cash Flow of $1.17 billion excluding changes in assets and liabilities.
  4. 2025 guidance calls for Adjusted EBITDA attributable to PAA of $2.80 to $2.95 billion and Adjusted Free Cash Flow of approximately $1.15 billion, reduced by about $580 million for Q1 2025 bolt-on transactions.
  5. Distribution increase of $0.25 per unit payable February 14, 2025, for a new annual distribution of $1.52 per unit, described as a 20% aggregate increase.
  6. Closed three bolt-on acquisitions for approximately $670 million net to PAA, including Ironwood Midstream Energy, and bought about 12.7 million Series A Preferred Units for roughly $330 million.
  7. Raised $1 billion of senior unsecured notes at 5.95% due 2035 in January 2025; leverage expected at or below the low end of the 3.25x to 3.75x target range.

03—Questions

Frequently Asked Questions

  1. Why was fourth-quarter 2024 net income so much lower than the prior year?

    The filing attributes the decline mainly to a $225 million charge from writing off a receivable for Line 901 insurance proceeds, plus $140 million of non-cash charges from the write-down of two U.S. NGL terminals. Net income attributable to PAA fell to $36 million from $312 million.

  2. Did the underlying business perform well despite the charges?

    Fourth-quarter Adjusted EBITDA attributable to PAA was $729 million, above the top end of guidance per the filing. Crude Oil segment Adjusted EBITDA rose 1%, driven by higher tariff volumes, tariff escalations and acquisitions, while NGL segment Adjusted EBITDA fell 9% on lower weighted average frac spreads.

  3. What does the 2025 outlook look like?

    The company expects 2025 Adjusted EBITDA attributable to PAA of $2.80 to $2.95 billion and about $1.15 billion of Adjusted Free Cash Flow before the roughly $580 million reduction for Q1 2025 bolt-on transactions. Growth capital is guided at +/- $400 million and maintenance capital at +/- $240 million, net to PAA.

  4. How is the distribution changing?

    The company announced a $0.25 per unit increase, payable February 14, 2025, bringing the new annual distribution to $1.52 per unit. The filing describes this as a 20% aggregate increase in the annualized distribution versus 2024 levels.

  5. How is the company managing its balance sheet?

    Leverage ended 2024 at 3.0x. The company raised $1 billion of senior unsecured notes at 5.95% due 2035 in January 2025 and anticipates leverage at or below the low end of its 3.25x to 3.75x target range.

04—Continue

← View all 8-K filings