Summary
Targa Resources Corp. (TRC) reported its financial results for the second quarter and first half of 2013, showing mixed performance compared to the prior year. While consolidated revenues increased year-over-year for the quarter, they declined for the six-month period, primarily due to lower NGL prices. Despite revenue headwinds, the company's strategic expansion projects and acquisitions, notably the Badlands acquisition, are progressing. The company is focused on growing its fee-based businesses within its Gathering and Processing and Logistics and Marketing segments. Management highlighted efforts to manage commodity price volatility through hedging activities and maintain compliance with debt covenants. Investors should note the significant capital expenditures for growth projects and the ongoing integration of recent acquisitions. The company's ability to generate distributable cash flow and fund dividends to shareholders remains a key focus, supported by distributions from Targa Resources Partners LP.
Financial Highlights
47 data points| Gross Profit | $265.20M |
| Operating Income | $60.90M |
| Interest Expense | $32.40M |
| Net Income | $15.00M |
| EPS (Basic) | $0.36 |
| EPS (Diluted) | $0.36 |
| Shares Outstanding (Basic) | 41.60M |
| Shares Outstanding (Diluted) | 42.10M |
Key Highlights
- 1Consolidated revenues increased by 9% to $1.44 billion for the three months ended June 30, 2013, compared to $1.32 billion in the prior year, driven by higher natural gas prices and volumes, as well as increased fee-based revenues.
- 2For the six months ended June 30, 2013, consolidated revenues decreased by 4% to $2.84 billion from $2.96 billion in the prior year, largely due to lower NGL prices, partially offset by higher natural gas and condensate prices and increased volumes.
- 3Operating expenses increased by 24% for the quarter and 22% for the six months, primarily due to system expansions, growth projects, the Badlands acquisition, and higher labor and maintenance costs.
- 4Depreciation and amortization expenses saw a significant increase of 36% for both the quarter and six-month period, driven by the Badlands acquisition and system expansions.
- 5The company completed the integration of the Badlands acquisition, which is expected to contribute to rapid growth in volumes and system build-out.
- 6Total assets grew to $5.41 billion as of June 30, 2013, from $5.11 billion at December 31, 2012, reflecting investments in property, plant, and equipment.
- 7Long-term debt increased to $2.73 billion as of June 30, 2013, from $2.48 billion at December 31, 2012, primarily to fund business expansion and acquisitions.