Summary
Targa Resources Corp. (TRGP), as the parent entity, derives its financial results primarily from its ownership interests in Targa Resources Partners LP (NGLS). The Partnership operates as a leading midstream provider of natural gas and natural gas liquid (NGL) services, with expanding operations in crude oil gathering and petroleum terminaling. For the fiscal year ended December 31, 2013, Targa Resources Corp. reported net income of $201.3 million, with net income attributable to common shareholders being $65.1 million. The company's primary objective is to increase cash available for dividends to its stockholders, achieved by supporting the Partnership's growth through various financial means. The Partnership demonstrated significant growth in 2013, with increases in total assets, Adjusted EBITDA, and distributable cash flow, driven by both organic growth projects and strategic acquisitions like the "Badlands" operations. Key strategic initiatives included substantial capital investments in expansion projects such as international exports, new fractionation capacity (Cedar Bayou Train 4), and new processing plants in North Texas and the Permian Basin. These investments highlight a forward-looking strategy focused on capitalizing on strong production trends in key shale plays and increasing demand for NGLs. The company's financial performance is closely tied to the Partnership's ability to generate and distribute cash. Investors should note the significant leverage at the Partnership level, which is managed through credit facilities and debt issuances. Targa Resources Corp. also maintains its own credit facility and debt obligations, contributing to the overall financial structure. The company emphasizes a dividend policy that aims to distribute cash received from the Partnership, though subject to reserves for expenses and other corporate needs.
Financial Highlights
50 data points| Gross Profit | $1.18B |
| Operating Income | $368.20M |
| Interest Expense | $134.10M |
| Net Income | $65.10M |
| EPS (Basic) | $1.56 |
| EPS (Diluted) | $1.55 |
| Shares Outstanding (Basic) | 41.60M |
| Shares Outstanding (Diluted) | 42.10M |
Key Highlights
- 1Targa Resources Corp.'s financial performance is intrinsically linked to Targa Resources Partners LP (the Partnership), with the parent company deriving its income from distributions received from its ownership interests in the Partnership.
- 2The Partnership experienced substantial growth in 2013, with total assets, Adjusted EBITDA, and distributable cash flow increasing significantly, driven by organic growth projects and acquisitions.
- 3Major capital investments were made in expansion projects, including international NGL exports, the Cedar Bayou Fractionator Train 4, and new processing plants, indicating a strategic focus on increasing capacity and capturing market demand.
- 4The company's business model relies heavily on the Partnership's ability to generate cash flow and make distributions. Fluctuations in commodity prices (natural gas, NGLs, crude oil) and operational efficiency are key drivers of profitability.
- 5Targa Resources Corp. has a commitment to returning capital to shareholders through dividends, which are funded by the cash distributions received from the Partnership.
- 6The company utilizes a significant amount of debt, both at the corporate and Partnership level, which requires careful management of leverage ratios and compliance with debt covenants.
- 7The report details extensive executive compensation plans, including base salary, annual cash bonuses, and long-term equity incentives, tied to company performance and peer group benchmarking.