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TRGP · Targa Resources Corp.

48 filings

10-Q

TRGP 10-Q Quarterly Reports

Targa Resources Corp. - 48 quarterly reports

Filing record · 2016–202610-K1110-Q328-K170

2026-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2026
Targa Resources Corp. (TRGP) reported strong financial performance for the second quarter and first half of 2026, driven by significant growth in its midstream services, particularly in the Logistics and Transportation segment. Total revenues increased by 4% sequentially to $4.44 billion for the quarter and decreased slightly by 3% year-over-year for the six-month period to $8.53 billion. Net income attributable to common shareholders saw a substantial increase of 22% sequentially to $764.6 million for the quarter and a 50% increase year-over-year to $1.24 billion for the six months. This performance was bolstered by higher fees from midstream services, reflecting increased volumes and expansion projects coming online, and favorable NGL and condensate prices, which offset lower natural gas prices. The company continued its aggressive growth strategy through acquisitions, notably the "Stakeholder Acquisition" for $1.25 billion, integrating new Permian Basin midstream infrastructure. Significant capital expenditures were directed towards growth projects, including new processing plants and pipeline expansions, indicating a strong focus on expanding its asset base and service offerings. Targa also demonstrated a commitment to shareholder returns, increasing its common dividend and continuing its share repurchase program, while maintaining a solid liquidity position and compliance with debt covenants.
Aug 6, 2026
2026-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2026
Targa Resources Corp. (TRGP) reported its first-quarter 2026 results, showcasing significant growth driven by strategic acquisitions and expansion projects. Total revenues decreased by 10% year-over-year to $4.1 billion, primarily due to lower commodity sales, but this was partially offset by an 11% increase in fees from midstream services. Net income attributable to common shareholders saw a substantial increase of 140% to $479.6 million, or $2.21 per diluted share, compared to $200.0 million in the prior year. This strong earnings performance was bolstered by significant increases in Adjusted EBITDA (up 19% to $1.4 billion) and Adjusted Cash Flow from Operations (up 22% to $1.18 billion). The company also actively managed its capital structure, completing a significant acquisition and issuing new long-term debt while repurchasing shares. Looking ahead, Targa continues to invest in growth, with numerous expansion projects underway across its gathering and processing, fractionation, and pipeline infrastructure. The company affirmed its financial strength, maintaining compliance with debt covenants and highlighting substantial liquidity.
May 7, 2026
2025-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2025
Targa Resources Corp. reported a strong third quarter of 2025, driven by growth in both its Gathering and Processing and Logistics and Transportation segments. Total revenues increased by 8% year-over-year to $4.15 billion, with net income attributable to common shareholders rising 23% to $478.4 million. This performance was supported by increased commodity sales, particularly in natural gas, and higher fees from midstream services, reflecting continued producer activity and infrastructure expansions. The company demonstrated robust operational execution, evidenced by significant increases in Adjusted EBITDA (up 19%) and Adjusted Free Cash Flow (up 39%). Targa Resources continued its strategic capital allocation by increasing its common dividend and actively repurchasing shares. The company also strengthened its financial position by issuing new long-term debt, including $1.5 billion in senior unsecured notes, and refinancing its revolving credit facility, positioning itself for continued growth and operational efficiency.
Nov 5, 2025
2025-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2025
Targa Resources Corp. (TRGP) reported a strong second quarter of 2025, demonstrating significant growth in revenues and income driven by robust performance across both its Gathering and Processing and Logistics and Transportation segments. Total revenues increased by 20% year-over-year to $4.26 billion, with net income attributable to common shareholders more than doubling to $629.1 million. This growth was fueled by higher commodity sales, particularly NGLs and natural gas, alongside increased fees from midstream services. The company also announced a significant capital allocation strategy, including an increase in its quarterly common dividend to $1.00 per share and the approval of a new $1.0 billion share repurchase program, underscoring its commitment to returning value to shareholders. Operationally, Targa Resources continues to expand its infrastructure, with several key projects in the Permian Basin and fractionation expansions progressing as planned. The company also completed a significant acquisition, increasing its ownership in Targa Badlands to 100%, which is expected to enhance its midstream footprint. Despite higher interest expenses due to increased borrowings, Targa maintained compliance with its debt covenants and reported ample liquidity, positioning it favorably to navigate the evolving energy landscape and fund future growth initiatives.
Aug 7, 2025
2025-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2025
Targa Resources Corp. (TRGP) reported its first-quarter 2025 results, demonstrating resilience with stable total revenues of $4.56 billion, mirroring the prior year's performance. While commodity sales saw a slight dip due to lower volumes and hedging impacts, this was effectively offset by a significant 9% increase in fees from midstream services, highlighting the company's strategic shift towards more fee-based revenue streams. Financially, TRGP significantly strengthened its balance sheet by issuing approximately $2.0 billion in new senior unsecured notes and securing a new $3.5 billion revolving credit facility. The company also completed a substantial acquisition, increasing its ownership in Targa Badlands to 100% for $1.8 billion, which was funded in part by the new debt issuance. Despite increased capital expenditures focused on growth projects, particularly in the Permian Basin, and a notable premium paid for noncontrolling interests, Targa Resources maintained healthy operating cash flow and declared an increased dividend for the first quarter of 2025, signaling confidence in its financial position and future outlook.
May 1, 2025
2024-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2024
Targa Resources Corp. reported solid financial results for the nine months ended September 30, 2024, with total revenues increasing by 1% to $11.98 billion compared to the prior year. The company saw significant growth in its Logistics and Transportation segment, with fees from midstream services up 23% year-over-year, driven by higher gas gathering, processing, and transportation fees, as well as increased export volumes. While commodity sales saw a slight decline, this was largely attributed to lower natural gas and NGL prices, partially offset by higher volumes. Targa continues to invest heavily in growth projects, with capital expenditures increasing significantly to $2.32 billion for the nine months ended September 30, 2024, primarily focused on system expansions in the Permian region and downstream business. The company also returned capital to shareholders through dividends and share repurchases, demonstrating a commitment to balancing growth with shareholder returns.
Nov 5, 2024
2024-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2024
Targa Resources Corp. (TRGP) reported its financial results for the second quarter and first half of 2024. The company demonstrated solid revenue growth, with total revenues increasing by 5% in the second quarter and 3% for the first half of the year, driven by strong performance in both its Gathering and Processing and Logistics and Transportation segments. Despite increased operating expenses and interest costs, the company's operational efficiency and strategic expansions contributed to a robust Adjusted EBITDA growth of 25% in the quarter and 13% year-to-date. Key financial highlights include a significant increase in fee-based midstream services revenue and strong NGL sales. The company continued its strategic capital allocation, increasing its common dividend and actively engaging in share repurchases, underscoring its commitment to returning value to shareholders. Targa Resources also highlighted significant progress on growth projects, including new processing plants in the Permian Basin and fractionation expansions, positioning the company for future production growth and enhanced service offerings. While facing some headwinds from commodity price volatility and increased operational costs, Targa Resources' diversified business model and proactive risk management strategies appear to be effectively navigating the current market environment.
Aug 1, 2024
2024-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2024
Targa Resources Corp. (TRGP) reported its first quarter 2024 results, showing resilient performance in a dynamic energy market. Total revenues increased slightly year-over-year to $4.56 billion, driven by a significant 23% rise in midstream service fees, which offset a modest decline in commodity sales. The company's Gathering and Processing segment demonstrated growth in operating margin, particularly in the Permian region, fueled by increased natural gas inlet volumes from new plant additions and strong producer activity. The Logistics and Transportation segment also saw growth in adjusted operating margin, supported by higher NGL pipeline transportation and fractionation volumes, benefiting from increased supply and export demand. While overall net income attributable to common shareholders decreased significantly compared to the prior year's quarter, this was largely due to the absence of a large non-controlling interest repurchase that occurred in Q1 2023. Adjusted EBITDA showed a modest increase, indicating strong underlying operational performance. The company also reaffirmed its capital expenditure guidance for 2024, highlighting ongoing investments in growth projects, and increased its quarterly dividend.
May 2, 2024
2023-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2023
Targa Resources Corp. (TRGP) reported strong results for the third quarter and first nine months of 2023, demonstrating resilience and operational execution. While total revenues saw a decline primarily due to lower commodity prices, the company's fee-based midstream services revenue increased, indicating a positive shift towards more stable income streams. Net income attributable to common shareholders rose by 14% year-over-year for the quarter, driven by improved operational performance and effective cost management. The company continued to execute its growth strategy, with significant capital expenditures focused on expanding its Permian Basin and Mont Belvieu facilities. Targa also actively managed its capital allocation, increasing its common dividend and continuing its share repurchase program. Despite inflationary pressures and higher interest expenses, Targa maintained compliance with its debt covenants and a healthy liquidity position, underscoring its financial stability and operational strength.
Nov 2, 2023
2023-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2023
Targa Resources Corp. (TRGP) reported a solid financial performance for the second quarter and the first half of 2023, demonstrating resilience despite lower commodity prices. Revenues saw a significant decrease year-over-year, largely due to lower commodity sales driven by declining prices for NGLs, natural gas, and condensate. However, this was partially offset by higher volumes and the favorable impact of commodity hedges. Despite the revenue decline, profitability remained strong, with Net Income attributable to Targa Resources Corp. increasing by 21% for the first six months of 2023 compared to the same period in 2022. This was driven by strong operational execution across both the Gathering and Processing and Logistics and Transportation segments, contributing to an increase in Adjusted EBITDA and Distributable Cash Flow. The company also continued to execute its capital allocation strategy, increasing its common dividend and actively repurchasing shares, while investing heavily in growth projects, particularly in the Permian Basin. Key financial indicators such as Adjusted EBITDA and Distributable Cash Flow showed robust year-over-year growth for the six-month period, underscoring the company's ability to generate strong operational cash flows. Targa also maintained compliance with its debt covenants and reported healthy liquidity, with significant availability under its credit facilities, positioning it to fund ongoing operations and growth initiatives.
Aug 3, 2023
2023-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2023
Targa Resources Corp. (TRGP) reported its first-quarter 2023 financial results, showing a significant increase in net income to $555.2 million compared to $168.6 million in the prior year. This strong performance was driven by a substantial increase in income from operations, which more than tripled year-over-year, fueled by higher fees from midstream services and effective cost management, particularly in product purchases and fuel. The company's strategic focus on expanding its fee-based midstream services, evidenced by ongoing construction projects in the Permian Basin and Mont Belvieu, positions it well for future growth. Targa also demonstrated a commitment to shareholder returns through share repurchases and a recent dividend increase. Despite increased interest expenses and operating costs, the overall financial health appears robust, with ample liquidity and compliance with debt covenants providing a stable outlook for the coming periods.
May 4, 2023
2022-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2022
Targa Resources Corp. (TRGP) reported strong financial performance for the nine months ended September 30, 2022, with total revenues increasing by 42% to $16.4 billion, driven by higher commodity prices and increased volumes across its gathering and processing, and logistics and transportation segments. Net income attributable to common shareholders saw a significant 81% increase to $578.9 million compared to the same period last year. The company executed a substantial acquisition in the Delaware Basin for approximately $3.5 billion, significantly expanding its footprint in that key region and integrating valuable natural gas gathering, treating, and processing assets. Targa also undertook strategic debt management, including significant new debt issuances and redemptions, and successfully redeemed all outstanding Series A Preferred Stock. Despite increased interest expenses due to higher borrowings, the company maintained compliance with its debt covenants and ended the period with substantial liquidity.
Nov 3, 2022
2022-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2022
Targa Resources Corp. (TRGP) reported strong financial performance for the second quarter and first half of 2022, demonstrating significant growth in revenues and net income, driven by higher commodity prices and increased volumes across its midstream operations. The company successfully navigated a dynamic market, with total revenues surging by 77% year-over-year for the quarter and 56% for the first half. This robust performance translated into substantial improvements in profitability, with net income attributable to common shareholders rising significantly. Targa also made strategic moves, including the significant acquisition of Lucid Energy Delaware, LLC, and the divestiture of its stake in GCX, indicating active portfolio management. The company's commitment to returning capital to shareholders is evident through increased common dividends and share repurchases, alongside the redemption of its Series A Preferred Stock.
Aug 4, 2022
2022-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2022
Targa Resources Corp. (TRGP) reported solid financial results for the first quarter of 2022, demonstrating strong revenue growth driven by higher commodity prices and increased fee-based services. Total revenues increased by 37% year-over-year to $4.96 billion, with commodity sales up 36% and midstream service fees up 48%. This top-line growth translated into a significant increase in Adjusted EBITDA, which rose 21% to $625.8 million. Operationally, the company saw robust growth in its Gathering and Processing segment, with a 45% increase in operating margin, largely fueled by higher natural gas inlet volumes and realized commodity prices, particularly in the Permian Basin. The Logistics and Transportation segment also showed positive momentum, with a 1% increase in adjusted operating margin driven by higher NGL pipeline transportation, fractionation, and export volumes. Despite a challenging operational environment in early 2021 due to extreme weather, Targa has successfully navigated market dynamics, executing strategic acquisitions and divestitures, including the acquisition of Southcross Energy and the sale of its GCX interest. The company also strengthened its balance sheet through new credit facilities and debt management, positioning itself for continued growth and shareholder returns.
May 5, 2022
2021-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2021
Targa Resources Corp. reported a strong financial performance for the nine months ended September 30, 2021, with total revenues more than doubling compared to the same period in 2020, reaching $11.5 billion. This significant increase was driven by a surge in commodity prices, particularly for NGLs, natural gas, and condensate, coupled with higher volumes across its Gathering and Processing and Logistics and Transportation segments. The company demonstrated robust operational execution, achieving substantial growth in its adjusted EBITDA and Distributable Cash Flow, indicating healthy cash generation capabilities. Key financial highlights include a significant improvement in net income attributable to common shareholders, shifting from a substantial loss in the prior year to a net profit of $319.3 million. This turnaround reflects the recovery in commodity markets and the company's strategic focus on operational efficiency and fee-based businesses. Targa also continued its deleveraging efforts by issuing new debt and using proceeds to redeem existing notes, further strengthening its balance sheet. The company signaled confidence in its future prospects with an announced increase in its common dividend and strategic capital allocation plans.
Nov 4, 2021
2021-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2021
Targa Resources Corp. (TRGP) reported its Q2 2021 results, showcasing a significant rebound from the challenges faced in 2020, particularly driven by higher commodity prices and volumes. Total revenues more than doubled year-over-year to $3.42 billion, with commodity sales seeing a substantial 141% increase due to higher NGL, natural gas, and condensate prices and volumes. The company demonstrated improved profitability, with net income attributable to common shareholders rising to $34.4 million from $48.9 million in the prior year's quarter, which included a significant impairment charge in 2020. This improved performance is further reflected in the non-GAAP measures, with Adjusted EBITDA increasing by 31% year-over-year to $460 million. Financially, Targa Resources has been actively managing its debt structure, including issuing new senior notes and redeeming older ones. The company ended the quarter with $209.0 million in cash and cash equivalents and substantial liquidity through its revolving credit facilities. Despite ongoing market volatility and risks, the company's operational performance and financial management indicate a positive trajectory.
Aug 5, 2021
2021-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2021
Targa Resources Corp. (TRGP) demonstrated a significant rebound in the first quarter of 2021 compared to the same period in 2020, driven by a substantial increase in commodity sales, primarily due to higher NGL, natural gas, and condensate prices. Total revenues surged by 77% year-over-year, largely on the back of an 89% increase in commodity sales. Despite an increase in product purchase costs, the company managed to improve its overall financial performance, as evidenced by a healthy increase in Adjusted EBITDA by 20% and Distributable Cash Flow by 32%. The company's operations were impacted by the February 2021 winter storm, which caused temporary disruptions. However, Targa reported an aggregate benefit of approximately $30 million from the storm's price and operational volatility. Furthermore, Targa successfully executed several financing activities, including the issuance of $1.0 billion in 4% Senior Notes due 2032, which were used to refinance existing debt and strengthen its balance sheet. The company also made progress on its Permian Midland Processing Expansion with the announced relocation of a processing plant.
May 6, 2021
2020-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2020
Targa Resources Corp. reported its third quarter 2020 results, a period significantly impacted by the ongoing COVID-19 pandemic and the resulting decline in commodity prices and demand. Despite these headwinds, the company demonstrated resilience, with total revenues increasing by 11% year-over-year for the quarter, driven by higher commodity sales. However, the nine-month period showed a significant net loss, largely attributable to a substantial $2.4 billion impairment of long-lived assets recognized in the first quarter, a direct consequence of the depressed commodity price environment. Operationally, Targa continued to expand its infrastructure, with key projects like the Gateway and Peregrine plants coming online and the expansion of its Grand Prix NGL pipeline nearing completion. The company also took steps to strengthen its financial position by issuing new debt and repurchasing existing notes, as well as reducing its quarterly common dividend to conserve cash and manage debt. While the nine-month period was negatively impacted by impairments, the third quarter showed a recovery in profitability and operating margins, indicating a potential stabilization or improvement in the business environment.
Nov 5, 2020
2020-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2020
Targa Resources Corp. (TRGP) reported its second-quarter 2020 results, which were significantly impacted by the volatile commodity price environment and the ongoing COVID-19 pandemic. The company experienced a substantial decline in revenues and recognized significant impairment charges related to long-lived assets, primarily in its Gathering and Processing segment. Despite these headwinds, Targa generated positive operating cash flow and maintained compliance with its debt covenants. The company also took steps to strengthen its financial position by reducing its quarterly common dividend and cutting capital expenditures. Management highlighted the company's fee-based business components and hedging strategies as key mitigants against commodity price volatility. The company's financial performance in the first half of 2020 was marked by a large impairment charge of $2.44 billion, largely impacting its Mid-Continent and Coastal operations within the Gathering and Processing segment. This impairment was driven by the significant drop in commodity prices due to global demand destruction from COVID-19 and supply-side factors. While revenues decreased year-over-year, the company managed to improve its operating margin and gross margin, driven by cost reduction measures and a shift in contract mix, particularly within the Logistics and Transportation segment. Targa ended the period with a solid liquidity position, supported by its revolving credit facilities.
Aug 6, 2020
2020-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2020
Targa Resources Corp. reported a significant net loss for the first quarter of 2020, primarily driven by a substantial impairment charge of $2.44 billion related to long-lived assets, largely within its Gathering and Processing segment. This impairment reflects the severe downturn in commodity prices experienced in the quarter, exacerbated by the COVID-19 pandemic and increased global oil production. Despite the large reported loss, the company's operational performance showed resilience in certain areas, with an increase in Adjusted EBITDA and Distributable Cash Flow compared to the prior year, demonstrating the benefit of its fee-based contracts and hedging strategies. In response to market conditions, Targa Resources has reduced its quarterly common dividend and significantly cut its 2020 capital expenditure guidance. The company's liquidity remains adequate, supported by available borrowing capacity on its credit facilities. Investors should monitor the ongoing impact of commodity prices, the effectiveness of cost-reduction measures, and the company's ability to manage its debt and capital expenditures in the challenging energy market.
May 7, 2020
2019-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2019
Targa Resources Corp. (TRGP) reported its third-quarter 2019 financial results, demonstrating resilience and strategic execution in a dynamic energy market. While total revenues saw a significant decrease year-over-year, largely due to lower commodity prices impacting commodity sales, the company's operational performance remained strong, with an increase in operating margin by 6%. This growth in operating margin was driven by increased volumes across its Permian and Badlands gathering and processing operations and robust performance in its Logistics and Marketing segment. The company also made significant strides in its growth projects, including the full service of the Grand Prix NGL pipeline and the commencement of new processing plants. Financially, TRGP managed its debt effectively, utilizing proceeds from asset sales, notably the divestiture of a 45% stake in Targa Badlands, to strengthen its balance sheet. The company maintained its dividend payments to common shareholders, underscoring its commitment to returning capital to investors. Looking ahead, TRGP is focused on continued growth through strategic expansions in key basins like the Permian and advancing its downstream infrastructure projects. The company's prudent financial management, demonstrated by its ability to fund substantial capital expenditures and service its debt obligations, positions it favorably to navigate market volatility and capitalize on future opportunities in the midstream energy sector.
Nov 7, 2019
2019-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2019
Targa Resources Corp. (TRGP) reported its financial results for the second quarter and first half of 2019. The company experienced a significant decrease in total revenues, primarily driven by lower commodity prices, particularly for NGLs, natural gas, and condensate. This was partially offset by higher volumes in some areas and fee-based revenue growth. Despite the revenue decline, Targa Resources demonstrated resilience through strong performance in its Gathering and Processing segment, especially in the Permian Basin, and significant growth in its Logistics and Marketing segment. The company continues to invest heavily in growth capital expenditures, particularly in expanding its processing capacity in the Permian and enhancing its NGL logistics infrastructure, including the Grand Prix NGL pipeline. The sale of a 45% interest in Targa Badlands for $1.6 billion provided a substantial cash inflow, which was utilized for debt repayment and general corporate purposes. While the company faces challenges from commodity price volatility and increased operating expenses due to expansion projects, its strategic focus on fee-based services and ongoing infrastructure development positions it for future growth. Investors should monitor the integration of new assets, ongoing capital expenditure execution, and the evolving commodity price environment.
Aug 9, 2019
2019-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2019
Targa Resources Corp. (TRGP) reported a first-quarter 2019 net loss attributable to common shareholders of $69.7 million, or $(0.30) per share, versus a $7.0 million loss in Q1 2018. The headline loss is driven largely by $80.6 million of net interest expense, compared with $16.1 million of net interest income a year earlier, which reflects the loss of non-cash income tied to mandatorily redeemable interests and higher average borrowings. Operationally the business improved: operating margin rose 12% to $383.2 million, Adjusted EBITDA increased 2% to $313.9 million, and gross margin grew to $573.4 million, led by Gathering and Processing volume growth in the Permian and Badlands and higher LPG export and fractionation margins in Logistics and Marketing. Distributable cash flow fell 9% to $196.7 million, and operating cash flow declined to $307.6 million from $354.4 million. The balance sheet shows meaningful leverage and heavy growth spending. Total debt rose to about $7.4 billion from $6.7 billion, and capital expenditures reached $905.6 million, with growth spending of $870.0 million concentrated in Trains 7 and 8, Permian processing plants and the Grand Prix pipeline. Cash fell to $124.9 million, and the company had roughly $3.15 billion of total liquidity as of May 3, 2019, after the April closing of the 45% Targa Badlands sale to Blackstone for $1.6 billion. That sale and the January 2019 senior notes issuance were used to repay debt and fund growth, and the sale is expected to materially change the funding mix for future North Dakota capital spending. For investors, the key tension is between a strong growth pipeline (roughly $2.3 billion of planned 2019 net growth capex, with major in-service dates in 2019 and 2020) and a weaker near-term earnings and cash flow profile driven by higher interest costs, depreciation, and the Series A Preferred dividend burden. Coverage of common dividends by distributable cash flow is thinner in this quarter, and the Vitol Splitter Agreement dispute and the IRS examination are noted as open items.
May 8, 2019
2018-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2018
Targa Resources Corp. (TRGP) reported a mixed third quarter 2018. Net income attributable to common shareholders was a loss of $54.0 million ($0.24 per share) for Q3 2018, compared with a loss of $197.0 million in Q3 2017, which had included a $378.0 million impairment. For the nine months, the company swung to net income attributable to common shareholders of $17.9 million, versus a $317.1 million loss a year earlier. The improvement is driven by operating performance: operating margin rose 30% to $408.0 million in Q3 and 23% to $1,117.9 million for the nine months, and Adjusted EBITDA grew to $358.0 million in Q3 (up 29%) and $990.6 million year to date (up 22%). Distributable cash flow reached $287.2 million in Q3, comfortably covering the $0.91 quarterly common dividend and the preferred dividends. Note that Q3 2018 included a $57.5 million loss on the held-for-sale Tacoma and Baltimore terminal sale and a $16.6 million contingent consideration charge. Growth spending is the central story. Capital expenditures were $2.31 billion for the nine months, and management expects at least $2.4 billion of net growth capex in 2018. Major projects include Grand Prix NGL pipeline (about $1.7 billion total cost), the Gulf Coast Express pipeline (about $1.75 billion), and fractionation trains 6 through 8. Much of this is financed by Stonepeak and Blackstone development joint ventures, which contributed $611.7 million of noncontrolling interest capital in the nine months. Net operating cash flow rose to $914.6 million from $531.9 million. Consolidated debt rose to about $5.97 billion, and liquidity was approximately $2.5 billion as of November 5, 2018. The balance sheet shows leverage increasing with the growth program, but liquidity remains adequate and the company was in compliance with its covenants. Risk factors include a $175.8 million net derivative liability, a $329.0 million Permian Acquisition earn-out due in May 2019, and customer concentration, with Petredec accounting for about 17% of Q3 revenue. The October 2018 S&P upgrade to BB, with a positive outlook, is a constructive development for funding costs.
Nov 8, 2018
2018-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2018
Targa Resources Corp. (TRGP) reported a solid second quarter 2018, with operating margin rising 77% year over year to $368.6 million and Adjusted EBITDA up 26% to $326.0 million. Net income attributable to Targa rose to $109.1 million from $57.6 million. Six-month results were also stronger, with operating margin up 19% to $710.1 million and Distributable Cash Flow of $441.4 million, compared with $390.2 million a year earlier. Growth was driven by higher Permian volumes, the March 2017 Permian Acquisition annualizing, and higher NGL and condensate prices, partially offset by lower natural gas prices. Note that the adoption of ASC 606 reduced reported revenue and product purchases but had no effect on operating or gross margin. The balance sheet expanded considerably as the company funded a heavy growth program. Capital expenditures reached $1.29 billion in the first half, versus $609 million a year earlier, with major projects including Grand Prix NGL pipeline, Train 6 fractionation, GCX, and new processing plants. Total assets grew to $15.6 billion, and long-term debt rose to $5.4 billion after the Partnership issued $1.0 billion of 5% senior notes due 2026. Stonepeak and Blackstone contributions through DevCo and joint venture structures, totaling $447 million of noncontrolling interest contributions year to date, helped fund the build-out. Liquidity stood at roughly $3.0 billion as of August 6, 2018. Investors should weigh the strong operating momentum against several items. Preferred dividends of $45.8 million per half year and common dividends of $0.91 per quarter absorb much of distributable cash flow, and the company remains non-investment grade. The Permian Acquisition earn-out liability of $312.4 million is due in May 2019, and the company is evaluating a potential divestiture of its Downstream Petroleum Logistics business. The Whistler Pipeline letter of intent, announced after quarter end, adds a further growth option.
Aug 9, 2018
2018-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2018
Targa Resources Corp. (TRGP) reported first-quarter 2018 net income attributable to Targa of $22.9 million, but after $29.9 million of preferred dividends (cash dividends plus deemed dividends), net loss attributable to common shareholders was $(7.0) million, or $(0.03) per share, versus a $(148.3) million loss ($(0.77) per share) in Q1 2017. Total revenues rose 16% to $2,455.6 million, gross margin increased 12% to $514.6 million, and operating margin rose 11% to $341.4 million, driven by Permian volume growth, higher NGL prices, and a full quarter of the Permian Acquisition. Adjusted EBITDA reached $306.6 million (up 11%) and distributable cash flow was $216.4 million versus $194.0 million a year earlier, against common dividends of $0.91 per share declared. The quarter's GAAP earnings were weighed down by a $56.1 million non-cash charge from the increase in fair value of the Permian Acquisition earn-out liability, which rose to $373.0 million. Operating cash flow increased to $354.4 million, but capital spending surged to $595.9 million in cash outlays, primarily for the Grand Prix NGL pipeline and Permian processing plants, and management expects at least $2.18 billion of net growth capex for announced projects in 2018. Financing was supported by $280.1 million of contributions from noncontrolling interests (largely Stonepeak and Blackstone), $57.7 million of common equity issuance, and $640 million of revolver borrowings, while total debt rose to $5.36 billion. Subsequent events include a $1.0 billion 5% senior notes offering by the Partnership in April 2018, a planned sale of the inland marine barge business for about $69.3 million, and an ongoing review of potential divestiture of the Downstream Petroleum Logistics business. For investors, the key trade-offs are strong operating and distributable cash flow growth and a large, fee-supported project backlog against elevated leverage, heavy reliance on joint-venture and partner funding, and a dividend that remains only marginally covered on a GAAP earnings basis. The company also flagged that it is non-investment grade with Moody's and S&P, which affects letter of credit and counterparty requirements.
May 3, 2018
2017-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2017
Targa Resources Corp. (TRGP) reported a net loss attributable to common shareholders of $197.0 million for Q3 2017 ($0.91 per share) versus a $39.4 million loss in Q3 2016, driven primarily by a $378.0 million non-cash impairment of North Texas gathering and processing assets. Excluding that charge, the quarter reflects healthier underlying operations: total revenues rose 29% to $2,131.8 million, operating margin increased 9% to $313.2 million, and Adjusted EBITDA grew 13% to $276.5 million, while distributable cash flow rose to $186.6 million from $168.3 million. Income from operations for the nine months was a loss of $235.9 million, also reflecting the impairment, with operating margin up 3% to $911.6 million. Growth was funded substantially through equity: the company completed the Permian Acquisition (about $571 million cash plus $416 million of contingent consideration at fair value), raised roughly $1.56 billion of net equity in 2017 through public offerings and its ATM program, and sold a 25% stake in the Grand Prix NGL pipeline joint venture to Blackstone. Total debt was $4.9 billion at quarter-end, and the company subsequently issued $750 million of 5% notes due 2028 to redeem its 2018 notes. Management also noted the Permian Acquisition's contingent earn-out liability was reduced by $125.5 million due to lower producer drilling activity, which boosted other income and signals weaker-than-expected volumes from the acquired assets. Investors should weigh the reported loss against the strong adjusted metrics, the rising dependence on dividends exceeding reported earnings ($2.73 per share declared year-to-date versus a net loss), the Series A Preferred dividend and deemed dividend burden, and the ongoing Permian growth capital program of roughly $1.3 billion for 2017. The company also disclosed that it remediated a previously reported material weakness in interim income tax provision controls.
Nov 3, 2017
2017-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2017
Targa Resources Corp. (TRGP) reported a mixed second quarter 2017. Net income attributable to Targa was $57.6 million for Q2 2017 versus a $23.2 million loss a year earlier, but for the six months the company still posted a $61.7 million net loss attributable to Targa. After preferred dividends ($22.9 million cash plus $6.3 million deemed dividends in Q2), net income attributable to common shareholders was $28.4 million for the quarter, or $0.14 per diluted share, and a loss of $120.0 million year to date. Consolidated operating margin was roughly flat year to date at $598.3 million and fell 3% in Q2 to $291.9 million, while Adjusted EBITDA rose modestly to $534.6 million for the six months. Distributable cash flow for Q2 was $196.0 million, up 26% from the prior year, helped partly by a one-time $20.9 million tax refund recognized in the quarter. The balance sheet and capital structure changed significantly. Targa acquired Permian assets (New Delaware and New Midland) for $987.1 million including contingent consideration, raised roughly $1.5 billion in common equity through January and June 2017 offerings, and redeemed the Partnership's 6% senior notes and repaid its term loan. Total debt obligations fell to $4.44 billion from $4.88 billion, and cash rose to $98.7 million. Management reported liquidity of $1.84 billion as of July 31, 2017. Capital spending is substantial, with at least $1.375 billion of net growth capex planned for 2017 and a Grand Prix NGL pipeline expected to cost about $1.3 billion. The company also disclosed a material weakness in internal control over income tax provisions for interim periods, and concluded that disclosure controls were not effective as of June 30, 2017. For investors, the key tension is between a strong growth and equity-funding story and near-term earnings pressure. Preferred dividends, the Series A Preferred's beneficial conversion feature accretion, and the high tax-related swings in the quarter continue to depress earnings to common shareholders, while the Permian and Grand Prix investments are expected to drive future fee-based cash flow. The Permian Acquisition also carries up to $935 million of potential earn-out payments in 2018 and 2019, which will add to future capital needs.
Aug 3, 2017
2017-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2017
Targa Resources Corp. (TRGP) reported a first-quarter 2017 net loss attributable to common shareholders of $148.3 million, or $(0.77) per share, compared with a $6.5 million loss in Q1 2016. The swing is driven largely by a $71.1 million income tax expense (mostly deferred tax), $16.1 million loss on the Venice Gathering System sale, a $12.0 million impairment on the T2 EF Cogen joint venture, $22.9 million of cash preferred dividends plus $6.1 million of deemed dividends on the Series A Preferred. Operating performance improved: operating margin rose 2.4% to $306.5 million (up from $299.3 million), with Gathering and Processing up 54% to $177.4 million, offset by a 17% decline in Logistics and Marketing to $130.1 million. Adjusted EBITDA increased 4.5% to $276.7 million and distributable cash flow rose 9% to $194.0 million, though the company's dividend of $0.91 per share on 191.8 million weighted shares was not fully covered by DCF on a standalone basis once preferred dividends are considered. The quarter was dominated by the March 1, 2017 Permian Acquisition of Outrigger's New Delaware and New Midland systems for an initial $574.1 million ($484.1 million paid at closing plus $90.0 million payable within 90 days) and up to $935.0 million of earn-outs payable in 2018 and 2019, with $461.6 million of contingent consideration recorded at fair value. The acquisition was funded largely by a $524.2 million January equity offering, and the company continued issuing shares under its at-the-market program. Total debt declined to $4.75 billion from $4.88 billion, but current maturities jumped to $534.9 million because the January 2018 5% senior notes and the securitization facility are now classified as current, and working capital (excluding current debt) fell $191.5 million. Management disclosed that disclosure controls were not effective due to a previously identified material weakness in controls over interim income tax provisions, which remains under remediation. Liquidity totaled $1.86 billion as of May 1, 2017. Investors should weigh the growth from the Permian expansion and the new processing capacity projects against the elevated leverage, the earn-out obligations, the tax-related earnings volatility, and the control deficiency.
May 4, 2017
2016-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2016
Targa Resources Corp. (TRGP) reported a weak third quarter 2016, with net loss attributable to common shareholders of $39.4 million (-$0.23 per share) versus $12.7 million of net income in Q3 2015. Revenue rose 1% to $1,652.3 million, but operating margin fell 12% to $286.6 million and income from operations dropped 55% to $51.6 million. Adjusted EBITDA declined 21% to $245.3 million and distributable cash flow fell 24% to $168.3 million. Lower Logistics and Marketing margins (LPG export fees, fractionation) more than offset gains in Gathering and Processing. Nine-month results were also down, with a $24.0 million goodwill impairment and a net loss attributable to common shareholders of $98.6 million. The structural story is the February 2016 TRC/TRP Merger, which bought in the public Partnership units for about 104.5 million new TRGP shares and gave TRGP full control of Targa Resources Partners LP cash flows. The company also issued $994.1 million of 9.5% Series A Preferred Stock with warrants in March 2016. Its preferred dividends (about $22.9 million per quarter) and the deemed-dividend accretion now weigh on common earnings. Share count rose from about 56 million to 173.7 million, so per-share metrics are not comparable year over year. Balance sheet actions were significant. In October 2016 the Partnership issued $1.0 billion of new 5% notes and used the proceeds, plus revolver borrowings, to tender for about $1.14 billion of 2018, 2020 and 2021 notes, with a roughly $59 million debt extinguishment loss expected in Q4. The TRP revolver was extended to October 2020. Management also disclosed that disclosure controls were not effective because of two material weaknesses, one related to 2015 acquisition valuations and one related to interim income tax provisions.
Nov 4, 2016
2016-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2016
Targa Resources Corp. (TRGP) reported a weak second quarter 2016, with a net loss attributable to common shareholders of $52.6 million (-$0.33 per share) versus $15.2 million of income in Q2 2015. Total revenues fell 7% to $1,583.6 million on lower commodity prices, and operating margin declined 8% to $299.5 million. Adjusted EBITDA dropped 15% to $257.1 million and distributable cash flow fell 19% to $169.6 million. Six-month results were similarly pressured, with a $24.0 million goodwill impairment and a $53 million year-over-year decline in operating margin to $598.8 million, partly offset by the inclusion of two extra months of TPL operations. The most significant structural event was the February 17, 2016 TRC/TRP Merger, in which Targa bought in the public unitholders of Targa Resources Partners LP for 104.5 million shares. This eliminated the public MLP structure and cut noncontrolling interests from $4.79 billion to $0.56 billion, while creating a deferred tax liability of roughly $950 million. The company also raised about $970 million net through a Series A Preferred and warrant offering, and issued $215 million of common stock under an at-the-market program. Proceeds were used largely to repurchase $559 million of Partnership senior notes at a discount, generating a $21.4 million net gain. Investors should weigh the improved balance sheet and simplified structure against the heavier dilution, rising share count, and a 9.5% preferred coupon that ranks senior to common equity. The company also disclosed a continuing material weakness in internal control over valuation of acquired assets, and the first quarter's goodwill impairment shows that further write-downs remain possible if commodity prices stay depressed. Liquidity was $455 million under the TRC revolver as of July 18, 2016, and management stated that cash flow should cover operations and the quarterly dividend for at least the next twelve months.
Aug 3, 2016
2016-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2016
Targa Resources Corp. (TRGP) reported a near-breakeven first quarter 2016, with net loss attributable to common shareholders of $6.5 million (-$0.06 per share) versus net income of $3.2 million a year earlier. Total revenues fell 14% to $1,442.4 million, driven by sharply lower commodity prices (about $522 million of revenue impact), partly offset by a full quarter of Atlas-acquired TPL operations. Operating margin was flat at $299.3 million, while depreciation and amortization rose 63% to $193.5 million and a $24.0 million goodwill impairment was recorded to finalize the 2015 provisional charge. Adjusted EBITDA rose 6.7% to $264.7 million, but distributable cash flow declined 8.7% to $179.7 million. The most significant event in the quarter was the February 17, 2016 TRC/TRP Merger, in which Targa acquired the public common units of Targa Resources Partners for about 104.5 million new TRC shares. This simplified the structure and entitles TRC to all Partnership cash flow going forward, but it created a large deferred tax liability (about $950 million) and reduced noncontrolling interests from $4.8 billion to $548 million. Financing was also significant: Targa sold $994 million of 9.5% Series A preferred stock with warrants to Stonepeak, and used the proceeds to repurchase $357.7 million of TRP senior notes for $330.6 million (a $24.7 million gain) and to reduce debt. Total long-term debt fell to $4.92 billion from $5.72 billion. Investors should note several risks: the company disclosed a material weakness in internal control over financial reporting that remained unremediated at quarter end, shareholder litigation over the TRC/TRP Merger (the federal suit was dismissed in April 2016, while a state court suit remains pending), dilution risk from the preferred stock and warrants, and continued exposure to depressed commodity prices and potential further impairments. Liquidity was $391.6 million at TRC and $1.67 billion at the Partnership as of April 19, 2016.
May 10, 2016
2015-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2015
Targa Resources Corp.'s (TRC) third-quarter 2015 results reflect a significant strategic shift following the substantial acquisition of Atlas Energy, L.P. (ATLS) and Atlas Pipeline Partners, L.P. (APL) earlier in the year. While consolidated revenues declined compared to the prior year, driven by lower commodity prices, the integration of Atlas assets boosted fee-based revenues and expanded operational scale. The company's financial performance highlights the ongoing impact of integrating these large-scale acquisitions, which have increased the company's asset base and complexity. Despite a challenging commodity price environment, TRC has maintained a focus on its midstream operations, with its Targa Resources Partners LP (the Partnership) segment showing increased throughput volumes and growth in fee-based services. The company's balance sheet reflects the significant increase in assets, liabilities, and goodwill associated with the Atlas transactions. Management is actively managing its debt and capital structure, with a significant amount of debt added due to the acquisitions. The company's liquidity remains adequate, supported by its credit facilities and cash flow from operations, though the low commodity price environment presents ongoing risks.
Nov 3, 2015
2015-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2015
Targa Resources Corp. (TRGP) reported a transformative but earnings-light second quarter 2015. The company completed the Atlas mergers on February 27, 2015, acquiring Atlas Pipeline Partners (APL, now Targa Pipeline Partners) and Atlas Energy (ATLS). Total assets nearly doubled to $13.35 billion from $6.45 billion at year-end 2014, and long-term debt rose to $5.80 billion from $2.89 billion. Revenues fell 15% year over year to $1.70 billion for the quarter (21% lower for the six months) as commodity prices dropped sharply, while operating margin rose 17% to $325.5 million, largely due to the acquired TPL assets in Field Gathering and Processing. Bottom-line results were weak. Net income available to common shareholders fell 42% to $15.2 million, or $0.27 per diluted share, versus $26.4 million a year earlier. Depreciation and amortization rose 91% to $163.9 million, interest expense nearly doubled to $70.2 million, and acquisition-related costs and debt-redemption losses further weighed on results. Much of the earnings decline reflects the rising share of net income going to noncontrolling interests in the Partnership, as well as the higher effective tax rate tied to incentive distribution rights (IDRs). Targa's cash flow from its Partnership stake and distributable cash flow rose to $51.9 million in the quarter from $28.7 million, supporting the $0.875 per share dividend declared for the quarter. For investors, the key takeaways are the scale-up of the asset base and distributable cash flow, offset by higher leverage, rising D&A and interest costs, and commodity price exposure that is partly mitigated by hedges. Management also highlighted pending ATLS/APL litigation settlements and a planned reduction of IDR payments under the IDR Giveback Amendment, which will affect future distributions to Targa.
Aug 4, 2015
2015-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2015
Targa Resources Corp. reported its first quarter 2015 results, marked by the significant completion of the Atlas mergers on February 27, 2015. This transformative event substantially increased the company's asset base and complexity. While reported revenues decreased year-over-year due to lower commodity prices, the pro forma results and operational metrics reflect the combined entity's expanded scale and reach across key midstream infrastructure assets. Key financial shifts include a significant increase in total assets, property, plant, and equipment, and goodwill, driven by the Atlas acquisitions. Long-term debt also saw a substantial rise to finance these transactions. Despite a lower net income available to common shareholders compared to the prior year, the company highlighted its adjusted EBITDA and distributable cash flow, which provide a view of operational cash flow generation potential, especially considering the new, larger operational footprint.
May 7, 2015
2014-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2014
Targa Resources Corp. (TRGP) reported a strong third quarter 2014, with consolidated revenues of $2,288.3 million (up 56% year over year for the nine-month period to $6,583.7 million) and net income available to common shareholders of $30.7 million, or $0.73 per diluted share, versus $0.39 a year earlier. Consolidated operating margin rose 48% to $295.0 million in the quarter, driven by LPG export growth, fractionation fees, and higher Field Gathering and Processing volumes from the Longhorn and High Plains plants. Much of the top-line growth reflects higher NGL volumes and prices passed through revenue, so investors should focus on fee-based margin and operating margin rather than revenue. Targa's results are almost entirely generated by its consolidated subsidiary, Targa Resources Partners LP (NGLS), since TRC has no separate operating activities. Of Q3 net income of $120.4 million, $89.7 million was attributable to noncontrolling interests, reflecting the public unitholders' stake in the Partnership. The filing's most consequential disclosure is the pending Atlas transactions announced October 13, 2014. The Partnership will acquire Atlas Pipeline Partners (APL) for an estimated $5.8 billion including debt, and Targa will acquire Atlas Energy (ATLS) for about $1.87 billion, consisting of roughly 10.35 million shares and $610 million in cash. The deals are interdependent and expected to close together in the first quarter of 2015. Shareholders would own roughly 80% of pro forma TRC, and the transaction would add Woodford/SCOOP, Mississippi Lime, and Eagle Ford assets. Investors should weigh the expected benefits against execution risk, the financing burden (including $1.1 billion of committed financing and the APL notes change-of-control obligation), and pending unitholder lawsuits seeking to enjoin the mergers. Balance sheet and liquidity remain manageable. Total long-term debt was $3.14 billion at September 30, 2014, and the Partnership raised $791.5 million of net proceeds in October from 4⅛% notes, which funded a pay-down of revolver and securitization borrowings. The Partnership's credit ratings were upgraded by S&P (to BB+) and Moody's (to Ba1, positive outlook) during 2014. Standalone TRC's liquidity is limited to $64.4 million, and its dividend ($0.7325 per share declared for Q3) depends on distributions from the Partnership, so distribution coverage through distributable cash flow ($31.0 million in Q3 for TRC non-Partnership) is a key metric to monitor.
Nov 4, 2014
2014-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2014
Targa Resources Corp. (TRGP) reported a strong second quarter 2014, with consolidated revenues of $2,061.9 million (up 43% year over year) and net income available to common shareholders of $26.4 million, or $0.63 per diluted share, versus $15.0 million, or $0.36, in Q2 2013. Operating margin rose 64% to $277.4 million, driven mainly by LPG export growth (average 159.0 MBbl/d versus 41.2 MBbl/d a year earlier), higher fractionation fees, new processing plants (Longhorn and High Plains), and higher commodity prices. For the six months, operating margin reached $552.7 million, up 61%. Much of this growth flows through the Partnership (Targa Resources Partners LP, NGLS), which TRGP consolidates, so a large share of consolidated net income ($76.8 million in Q2) is attributed to noncontrolling interests. Targa's own cash inflow depends on distributions from its 2% general partner interest, incentive distribution rights, and 11.3% limited partner stake. From a balance sheet and liquidity standpoint, consolidated long-term debt was $3,048.2 million at June 30, 2014, mostly Partnership obligations. TRC's own revolver had $87.0 million drawn against a $150 million facility, leaving total parent-level liquidity of $71.6 million. Partnership liquidity was about $677.7 million. Capital spending remains heavy, with six-month outlays of $419.6 million and 2014 growth capex guided at roughly $780 million gross. A planned condensate splitter (about $115 million) and a 100,000 bbl/d Mont Belvieu fractionation expansion (about $385 million, completion mid-2016) add to the pipeline. Management reported distributable cash flow of $28.7 million at the TRC level for the quarter, covering the declared $0.69 quarterly dividend when measured against the Partnership distributions received. Key risks include commodity price exposure (partly hedged), a net derivative liability of $11.4 million at the Partnership level, reliance on capital markets for funding, and counterparty credit. Investors should note that, as a parent, TRGP's dividend capacity depends on Partnership distributions, and that consolidated reported earnings substantially overstate the share attributable to TRGP shareholders.
Aug 1, 2014
2014-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2014
Targa Resources Corp. (TRGP) reported first-quarter 2014 net income of $106.9 million, up from $33.8 million a year earlier, on revenues of $2,352.9 million (up 68%). Net income available to common shareholders was $19.6 million, or $0.47 per diluted share, versus $0.32 in Q1 2013. The bulk of the increase flowed to noncontrolling interests ($87.3 million, versus $20.4 million), reflecting the public limited partner interests in Targa Resources Partners LP (NGLS), which TRC consolidates. Operating margin rose 58% to $275.3 million, driven by LPG export growth (115.6 MBbl/d versus 45.8 MBbl/d), higher fractionation volumes, and higher NGL and natural gas prices in the Field Gathering and Processing segment. Depreciation and G&A also increased, reflecting new capacity and a growing asset base. TRC is a holding company with no direct operations; its cash flows come almost entirely from its 11.4% limited partner interest, 2% general partner interest, and incentive distribution rights in the Partnership. Distributable cash flow for TRC was $27.0 million in Q1 2014, versus $25.1 million a year earlier, and the Partnership's Q1 distribution of $0.7625 per unit was declared on April 15, 2014. TRC's declared dividend rose to $0.6475 per share from $0.6075. The Partnership raised $115.3 million of net equity proceeds in Q1 and a further $47.7 million in April, which helped reduce debt. Consolidated long-term debt fell to $2,891.7 million from $2,989.3 million. The balance sheet remains heavily levered at the Partnership level, and the Partnership's hedge book carried a net liability of $9.6 million at quarter-end because forward commodity prices exceeded hedged fixed prices. Liquidity appears adequate, with TRC corporate liquidity of $91.5 million and Partnership liquidity of $829.2 million. Management states that cash flows from Partnership distributions should cover operations, debt service, taxes, and dividends for at least the next twelve months. Investors should watch commodity price sensitivity, Partnership leverage, and the ability to keep funding growth capital (roughly $700 million gross planned for 2014) through a mix of retained cash flow and equity issuance.
May 2, 2014
2013-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2013
Targa Resources Corp. (TRGP) reported third-quarter 2013 net income of $49.4 million (vs. $19.0 million in Q3 2012) and net income available to common shareholders of $16.3 million, or $0.39 per diluted share (vs. $0.21). For the nine months, net income available to common shareholders was $44.6 million, or $1.06 per diluted share, versus $0.64 a year earlier. Consolidated revenues rose 12% to $1,556.8 million in the quarter, and operating margin increased 23% to $199.4 million, driven by Field Gathering and Processing volumes (including the Badlands acquisition), higher natural gas and condensate prices, and LPG export growth. Income from operations rose 50% in the quarter, though much of the bottom-line gain was boosted by a one-time $9.1 million (quarter) and $15.3 million (year-to-date) non-cash other income from eliminating the Badlands contingent consideration liability. Because TRC has no operations of its own, its results depend on distributions from Targa Resources Partners LP (NGLS), in which TRC holds a 2% general partner interest, all incentive distribution rights, and about 11.9% of the common units. Distributable cash flow to TRC rose to $35.5 million in the quarter from $21.9 million, and the company declared a quarterly dividend of $0.57 per share, up from $0.4975-ish levels earlier in 2013 (the dividend has risen each quarter this year, from $0.4575 to $0.5325 and now $0.57). Noncontrolling interests absorbed a large share of Partnership earnings, consistent with TRC's limited economic share of the Partnership. The balance sheet expanded substantially, with total assets up to $5.73 billion from $5.11 billion at year-end 2012, and long-term debt rising to $2.87 billion, largely from Partnership borrowings to fund growth capital spending (about $708 million in investing outlays year to date, with roughly $900 million of gross growth capex expected for 2013). The Partnership refinanced high-cost notes by issuing $625 million of 4¼% senior notes due 2023, redeeming the 6⅜% and 11¼% notes, and raised about $377 million of equity through at-the-market programs. Management states liquidity of $80 million at TRC and $859.6 million at the Partnership as of October 28, 2013.
Nov 5, 2013
2013-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2013
Targa Resources Corp. (TRGP) reported second-quarter 2013 results that were mixed: revenues rose 9% year over year to $1,441.6 million, but net income available to common shareholders climbed to $15.0 million ($0.36 per diluted share) from $8.6 million, helped mainly by a sharply lower share of income attributed to noncontrolling interests in its subsidiary, Targa Resources Partners LP (NGLS). Consolidated operating margin was roughly flat at $169.1 million (up 1%), as higher Field Gathering and Processing volumes, Logistics fee growth and LPG export activity offset lower NGL prices, weaker Coastal Gathering and Processing margins (down 40%) and a planned maintenance turnaround at Cedar Bayou Fractionators. Six-month results were weaker, with revenues down 4% and operating margin down 4%, largely reflecting lower NGL realized prices in the first quarter. Balance sheet leverage increased meaningfully as the company funded a heavy growth program. Long-term debt rose to $2,728.0 million from $2,475.3 million at year-end 2012, and property, plant and equipment grew to $5,166.8 million gross, reflecting Badlands and other expansion projects. Six-month capital outlays were $444.5 million, and management expects roughly $1.0 billion in gross 2013 growth capex at the Partnership. Financing was supported by a $625 million 4¼% senior notes offering, $231 million of common unit sales, and an accounts receivable securitization facility, while $100 million of 6⅜% notes were redeemed at a $7.4 million loss. Subsequent to quarter-end, the Partnership redeemed its 11¼% notes, and TRC's liquidity stood at about $175 million as of July 29, 2013. For investors, the key drivers are the Partnership's distribution growth, which supports TRC's dividend and incentive distribution rights, and the company's ability to convert its growth capital into fee-based cash flow. Quarterly dividend declared was $0.5325 per share, and the Partnership declared $0.715 per unit. Distributable cash flow to TRC rose to $29.5 million in the quarter from $17.3 million, though the increase was partly structural and sensitive to commodity prices and the pace of Badlands ramp-up.
Aug 2, 2013
2013-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2013
Targa Resources Corp. (TRGP) reported its first quarter 2013 financial results, showing a decrease in net income to $33.8 million compared to $69.2 million in the same period of 2012. This decline was primarily driven by lower revenues, which fell to $1.40 billion from $1.65 billion year-over-year, largely due to decreased realized prices for NGLs and condensate. Despite the dip in net income, Targa Resources Corp.'s net income available to common shareholders increased to $13.4 million ($0.32 per diluted share) from $9.6 million ($0.23 per diluted share) in the prior year's quarter, indicating improved profitability for its common shareholders. The company's operational performance was impacted by fluctuating commodity prices and system volume changes across its segments. The Field Gathering and Processing segment saw a decrease in operating margin, while the Logistics Assets segment reported a significant increase. The company also highlighted its ongoing integration of the recently acquired Badlands assets and its strategic efforts to grow through expansions and potential acquisitions, funded by a combination of operating cash flow, debt, and equity issuances.
May 3, 2013
2012-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2012
Targa Resources Corp. (TRGP) reported a mixed third quarter of 2012 with weaker top-line results but modest improvement in operating margin and net income available to common shareholders. Consolidated revenues fell 19% year over year to $1,393.5 million, driven by lower commodity prices, while operating margin rose 7% to $162.2 million, aided by the Partnership's fee-based Logistics Assets and Marketing and Distribution segments and by higher volumes. Net income available to common shareholders rose to $8.7 million ($0.21 per diluted share) from $4.9 million, though income from operations was down 17% to $59.0 million due to a $15.4 million write-off of the Yscloskey plant investment and Hurricane Isaac-related costs. Nine-month results were more resilient, with operating margin up 8% and net income available to common shareholders up 21% to $26.9 million. Targas economics remain tied to Targa Resources Partners LP (NGLS), which it consolidates. Targa owns a 14.5% limited partner stake, all incentive distribution rights, and a 2% general partner interest, so its cash flow depends largely on distributions from the Partnership. Distributions to Targa from the Partnership rose sharply: the quarter's declared distributions totaled $26.2 million, up from $16.8 million a year earlier, primarily reflecting higher IDR payments. Noncontrolling interests absorbed most of the Partnership's earnings, which is why net income attributable to Targa is small relative to consolidated net income. Balance sheet and liquidity moved in several directions. Long-term debt increased to $1,751.0 million from $1,567.0 million, mainly from the Partnership's $400 million 6⅜% notes issued in January 2012. Subsequent to quarter-end, the company refinanced its credit facilities, expanded the Targa revolver to $150 million, repaid the TRC Holdco loan, and the Partnership issued $400 million of 5¼% notes due 2023 to redeem its 8¼% notes at a premium. Management states that internally generated cash flow and available credit should be sufficient for at least the next twelve months, though the Partnership's exposure to commodity prices, hedging counterparties, and capital markets remains a key risk.
Nov 1, 2012
2012-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2012
Targa Resources Corp. (TRGP) reported Q2 2012 results that showed top-line and profit pressure from weaker commodity prices, while its underlying midstream franchise continued to grow. Consolidated revenues fell 24% year over year to $1,319.1 million for the quarter (and 11% to $2,964.9 million for the six months), driven by lower realized NGL and natural gas prices, which more than offset higher volumes and fee-based revenue. Operating margin declined 7% to $167.2 million in the quarter, though it rose 8% for the six months to $357.2 million. Net income available to common shareholders was $8.6 million ($0.21 per diluted share) versus $10.5 million ($0.25) a year earlier, as a larger share of Partnership earnings went to noncontrolling interests. Because TRGP has no separate operating business, its value to shareholders depends on cash distributions from its roughly 14.5% limited partner interest, its 2% general partner interest, and its incentive distribution rights in Targa Resources Partners LP (NGLS). Management's key metric, distributable cash flow, rose to $31.5 million for the six months from $25.8 million, and the Partnership declared a $0.6425 per unit quarterly distribution (about a $2.57 annual rate) payable August 14, 2012. Dividends declared to TRGP shareholders were $0.39375 per share for the quarter. The Partnership's January 2012 equity offering and $400 million 6⅜% senior notes raised roughly $564 million combined and lifted TRGP's ownership of the Partnership to 16.2%. Liquidity is adequate, with consolidated cash of $117.5 million and the Partnership holding $889.8 million of revolver availability at June 30, 2012. Risks to monitor include commodity price exposure, although the Partnership's hedge book (a net asset of $70.7 million) cushions downside through 2015, capital spending that the Partnership estimates at about $650 million net for 2012, and the EPA's new air emission rules for gas processing, which could add compliance costs. TRGP's parent-level debt (the $89.3 million Holdco loan) is small relative to the Partnership's obligations, and the company reported no material changes to its critical accounting policies.
Aug 6, 2012
2012-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2012
Targa Resources Corp. (TRC) reported its first quarter 2012 financial results, showing a significant increase in net income to $69.2 million, up from $40.8 million in the same period of 2011. This growth was driven by higher commodity sales volumes and increased fee-based revenues within its Logistics and Marketing segment. The company also benefited from a substantial increase in gross margin, up 20% year-over-year, indicating improved operational performance and cost management. Financially, Targa Resources demonstrated solid operational execution. The company's balance sheet reflects total assets of $3.70 billion as of March 31, 2012, with a notable increase in Property, plant and equipment, net, to $2.87 billion. Long-term debt stood at $1.47 billion. Cash provided by operating activities was strong at $138.8 million for the quarter, supporting its operational needs and strategic initiatives. Investors should note the company's focus on growing its fee-based revenue streams and managing commodity price exposure through hedging activities.
May 4, 2012
2011-Q3
Targa Resources Corp. Quarterly Report for Q3 Ended Sep 30, 2011
Targa Resources Corp. (TRGP) reported its third-quarter and nine-month results for the period ending September 30, 2011. The company experienced significant revenue growth, driven by higher NGL and condensate sales volumes and prices, as well as increased fee-based services. This growth translated into a substantial increase in operating margin, demonstrating improved operational performance across its gathering, processing, and logistics segments. Financially, Targa Resources Corp. saw its total assets grow, supported by strategic acquisitions in the logistics and marketing segment, including new terminaling facilities. The company also managed its debt effectively, issuing new notes and refinancing existing debt, while maintaining compliance with debt covenants. Cash flow from operations remained robust, providing resources for both operational needs and capital expenditures, including significant expansion projects planned for the coming years.
Nov 7, 2011
2011-Q2-A
Targa Resources Corp. Quarterly Report (Amendment) for Q2 Ended Jun 30, 2011
This Form 10-Q/A (Amendment No. 1) for Targa Resources Corp. (TRGP) for the quarter ended June 30, 2011 does not contain new financial results, management discussion, or risk disclosures. Its sole purpose, as stated in the explanatory note, is to furnish Exhibit 101, the XBRL-formatted version of the consolidated financial statements and notes from the original Form 10-Q filed August 8, 2011. The amendment states that no other changes were made and that it does not update the original disclosures. The financial statements themselves are not reproduced in the text provided, so no revenue, earnings, cash flow, or balance sheet figures can be drawn from this document. For investors, the filing is primarily administrative. It confirms that the company is a non-accelerated filer, reports 42,349,738 shares of common stock outstanding as of August 1, 2011, and lists exhibits that include supplemental indentures dated April 8, 2011 covering Targa Terminals LLC, a subsidiary of Targa Resources Partners LP, as guarantor-related documentation. Investors seeking operating or financial performance for the period should review the original Form 10-Q filed August 8, 2011, which contains the full financial statements and Management's Discussion and Analysis. The XBRL exhibits are deemed furnished rather than filed under Rule 406T, which limits their liability under Sections 11, 12, and 18 of the Securities Act and Exchange Act.
Aug 19, 2011
2011-Q2
Targa Resources Corp. Quarterly Report for Q2 Ended Jun 30, 2011
Targa Resources Corp. (TRGP) reported a strong second quarter of 2011, with consolidated net income of $63.3 million versus $7.4 million a year earlier, and operating margin up 49% to $178.9 million. Revenues rose 39% to $1,727.7 million, driven mainly by higher commodity prices and NGL sales volumes, while product purchases rose in step. Net income attributable to Targa Resources Corp. (the parent, excluding noncontrolling interests) was $10.5 million, or $0.25 per diluted share, compared with a loss in the prior-year period that was distorted by large preferred and common-equivalent dividends tied to the 2010 IPO and restructuring. Most of the operating results come from Targa Resources Partners LP (NGLS), which Targa consolidates and in which Targa owns a 13.7% limited partner interest plus the general partner and incentive distribution rights. Balance sheet and liquidity improved. Total long-term debt fell to $1,265.8 million from $1,534.7 million at year-end 2010, largely because the Partnership issued $325 million of 6% senior notes due 2021 in February and used the proceeds, along with its equity offering, to repay its revolver. Partnership revolver availability was $815.7 million at quarter end. Targa's standalone cash of $81.6 million is earmarked for an estimated $83.0 million tax liability over fourteen years and for Versado capital reimbursements, and Targa's cash inflow depends on distributions from the Partnership. The Partnership declared a $0.57 per unit distribution for Q2 2011, and Targa declared a $0.29 quarterly dividend per share payable August 16, 2011. Key risks include commodity price exposure, with the Partnership's NGL hedge book carrying a mark-to-market liability of roughly $58 million, a $3.2 million loss on de-designated interest rate swaps, and a non-investment-grade credit rating that raises counterparty collateral demands. The filing also flags proposed EPA air emission rules issued July 28, 2011, which could raise customer and Partnership operating costs. The $360 million Cedar Bayou Fractionator expansion, targeted for completion in Q1 2013, is the largest announced growth project.
Aug 8, 2011
2011-Q1
Targa Resources Corp. Quarterly Report for Q1 Ended Mar 31, 2011
Targa Resources Corp. (TRC) reported its first quarter 2011 financial results, showcasing a notable increase in revenues driven by higher natural gas and NGL sales volumes and improved commodity prices. The company successfully managed operating expenses, leading to a significant expansion in operating margin. While TRC's consolidated net income saw a slight decrease year-over-year, primarily due to a substantial rise in non-controlling interests, the underlying operational performance of its midstream subsidiary, Targa Resources Partners LP (TRP), remained robust. TRP's strategic initiatives, including the acquisition of a refined products terminal and debt management, position it for continued growth. Investors should note the company's focus on cash flow generation and dividend payouts, supported by the stable performance of its gathering, processing, and logistics assets.
May 6, 2011