Pembina Pipeline Corporation Reports Strong Results for the First Quarter 2024 and Raises Quarterly Common Share Dividend
All financial figures are in Canadian dollars unless otherwise noted. This news release refers to certain financial measures and ratios that are not specified, defined or determined in accordance with Generally Accepted Accounting Principles ("GAAP"), including net revenue; adjusted earnings before interest, taxes, depreciation and amortization ("adjusted EBITDA"); adjusted cash flow from operating activities; adjusted cash flow from operating activities per common share; and proportionately consolidated debt-to-adjusted EBITDA. For more information see "Non-GAAP and Other Financial Measures" herein.
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Highlights
-
First Quarter Results - reported quarterly earnings of
$438 million and record quarterly adjusted EBITDA of$1,044 million . -
Recent Business Updates - as previously disclosed, developments during and following the first quarter include closing the acquisition of additional interests in the Alliance Pipeline and
Aux Sable (the "Alliance/Aux Sable Acquisition") onApril 1, 2024 , raising Pembina's 2024 adjusted EBITDA guidance range, signing long-term agreements to supply and transport up to 50,000 barrels per day of ethane to support a new petrochemical facility, approval of the expansion ofPembina Gas Infrastructure's ("PGI") Wapiti gas plant, and significant progress made on the development of the proposed Cedar LNG project. -
Common Share Dividend Increase - the board of directors declared a common share cash dividend for the second quarter of 2024 of
$0.69 per share, representing an increase of 3.4 percent to be paid, subject to applicable law, onJune 28, 2024 , to shareholders of record onJune 17, 2024 . -
Strong Balance Sheet - at
March 31, 2024 , the ratio of proportionately consolidated debt-to-adjusted EBITDA was 3.4 times, below the low end of the Company's targeted range. -
Investor Day - at its 2024 Investor Day to be held on
May 16, 2024 , Pembina's officer team will provide an overview of the business and the outlook for the Company amidst transformational changes in the western Canadian energy industry.
Financial and Operational Overview
|
3 Months Ended |
|
($ millions, except where noted) |
2024 |
2023 |
Revenue(1) |
1,540 |
1,618 |
Net revenue(1)(2) |
912 |
936 |
Gross profit |
730 |
672 |
Adjusted EBITDA(2) |
1,044 |
947 |
Earnings |
438 |
369 |
Earnings per common share – basic (dollars) |
0.74 |
0.61 |
Earnings per common share – diluted (dollars) |
0.73 |
0.61 |
Cash flow from operating activities |
436 |
458 |
Cash flow from operating activities per common share – basic (dollars) |
0.79 |
0.83 |
Adjusted cash flow from operating activities(2) |
782 |
634 |
Adjusted cash flow from operating activities per common share – basic (dollars)(2) |
1.42 |
1.15 |
Capital expenditures |
186 |
137 |
(1) |
Comparative 2023 period has been adjusted. See "Accounting Policies & Estimates - Change in Accounting Policies" in Pembina's Management's Discussion and Analysis dated |
|
(2) |
Refer to "Non-GAAP and Other Financial Measures". |
|
Financial and Operational Overview by Division
|
3 Months Ended |
|||||
|
2024 |
2023 |
||||
($ millions, except where noted) |
Volumes (1) |
Earnings (Loss) |
Adjusted
|
Volumes(1) |
Earnings (Loss) |
Adjusted
|
Pipelines |
2,598 |
455 |
599 |
2,467 |
376 |
525 |
Facilities |
805 |
177 |
310 |
721 |
135 |
298 |
Marketing & New Ventures |
295 |
64 |
188 |
267 |
120 |
169 |
Corporate |
— |
(167) |
(53) |
— |
(156) |
(45) |
Income Tax Expense |
— |
(91) |
— |
— |
(106) |
— |
Total |
|
438 |
1,044 |
|
369 |
947 |
(1) |
Volumes for the Pipelines and Facilities divisions are revenue volumes, which are physical volumes plus volumes recognized from take-or-pay commitments. Volumes are stated in mboe/d, with natural gas volumes converted to mboe/d from MMcf/d at a 6:1 ratio. Excludes volumes through third-party processing agreements at Empress. Volumes for |
|
(2) |
Refer to "Non-GAAP and Other Financial Measures". |
|
For further details on the Company's significant assets, including definitions for capitalized terms used herein that are not otherwise defined, refer to Pembina's Annual Information Form for the year ended
Financial & Operational Highlights
Adjusted EBITDA
Pembina reported first quarter adjusted EBITDA of
Pipelines reported adjusted EBITDA of
- higher revenues and volumes on the Peace Pipeline system;
-
the Northern Pipeline system outage in the first quarter of 2023, which had an impact of
$40 million , with no similar impacts in the first quarter of 2024; - the reactivation of the Nipisi Pipeline; and
- higher contribution from Alliance Pipeline related to higher tolls on seasonal contracts.
Facilities reported adjusted EBITDA of
-
higher volumes at the
Redwater Complex and Younger compared to the first quarter of 2023, as the prior period was impacted by the Northern Pipeline system outage. The impact of the Northern Pipeline system outage was$14 million in the first quarter of 2023; and - higher operating expenses.
Marketing & New Ventures reported adjusted EBITDA of
-
higher contribution from
Aux Sable due to wider frac spreads and a new third-party marketing arrangement; - change in the provision related to financial assurances for Cedar LNG; and
- realized losses on NGL-based derivatives in the first quarter of 2024 compared to realized gains in the first quarter of 2023.
Corporate reported adjusted EBITDA of negative
Earnings
Pembina reported first quarter earnings of
Pipelines had earnings in the first quarter of
Marketing & New Ventures had earnings in the first quarter of
In addition to the changes in earnings for each division discussed above, the increase in first quarter earnings compared to the prior period was due to lower income tax expense, partially offset by higher costs in the corporate segment, as noted above.
Cash Flow From Operating Activities
Cash flow from operating activities of
On a per share (basic) basis, cash flow from operating activities was
Adjusted Cash Flow From Operating Activities
Adjusted cash flow from operating activities of
On a per share (basic) basis, adjusted cash flow from operating activities was
Volumes
Pipelines volumes of 2,598 mboe/d in the first quarter represent a five percent increase compared to the same period in the prior year. The increase was primarily due to higher volumes on the Peace Pipeline system resulting from earlier recognition of take-or-pay deferred revenue and the impact of the Northern Pipeline system outage in the first quarter of 2023, combined with the reactivation of the Nipisi Pipeline. In the first quarter of 2023, the impact of the Northern Pipeline system outage on Pipelines volumes was approximately 62 mbbls/d.
Facilities volumes of 805 mboe/d in the first quarter represent a 12 percent increase compared to the same period in the prior year. The increase was primarily due to higher volumes at the
Crude oil sales volumes of 80 mboe/d in the first quarter represent a 10 percent increase compared to the same period in the prior year, primarily due to higher blending opportunities compared to the first quarter of 2023, which was impacted by the Northern Pipeline system outage.
NGL sales volumes of 215 mboe/d in the first quarter represent an 11 percent increase compared to the same period in the prior year, primarily due to higher ethane and butane sales as the first quarter of 2023 was impacted by lower supply volumes from the
Quarterly Common Share Dividend
Pembina's board of directors has declared a common share cash dividend for the second quarter of 2024 of
For shareholders receiving their common share dividends in
Quarterly dividend payments are expected to be made on the last business day of March, June, September and December to shareholders of record on the 15th day of the corresponding month, if, as and when declared by the board of directors. Should the record date fall on a weekend or on a statutory holiday, the record date will be the next succeeding business day following the weekend or statutory holiday.
Executive Overview
Strong first quarter results, including record quarterly adjusted EBITDA, have provided an encouraging start to 2024 and our outlook for the business has been further bolstered by notable commercial successes and industry developments.
On
In conjunction with the acquisition closing, Pembina updated its 2024 adjusted EBITDA guidance range to
Further, we are pleased today to announce an increase in the quarterly common share cash dividend of 3.4 percent. The increase reflects the continued growth of Pembina's fee-based business, which is benefiting from rising volumes and increasing utilization across many of its assets in the
As previously announced, during the first quarter, Pembina entered into long-term agreements with
Finally, Pembina recently announced significant achievements in the development of the proposed Cedar LNG project, including securing long-term commercial agreements and issuing a notice to proceed to its engineering, procurement, and construction contractors. Following these critical milestones Cedar LNG and Pembina's partner, the Haisla Nation, have commenced their respective financing processes, in advance of a final investment decision, which is expected by
In addition to LNG developments on
At our upcoming Investor Day on
Projects and New Developments(1)
Pipelines
-
The Phase VIII Peace Pipeline expansion will enable segregated pipeline service for ethane-plus and propane-plus NGL mix from Gordondale,
Alberta , which is centrally located within theMontney trend, into theEdmonton area for market delivery. The project includes new 10-inch and 16-inch pipelines, totaling approximately 150 kilometres, in the Gordondale toLa Glace corridor ofAlberta , as well as new mid-point pump stations and terminal upgrades located throughout the Peace Pipeline system. Phase VIII will add approximately 235,000 bpd of incremental capacity between Gordondale,Alberta andLa Glace, Alberta , as well as approximately 65,000 bpd of capacity betweenLa Glace, Alberta and theNamao hub nearEdmonton, Alberta . As previously disclosed, the estimated project cost was revised lower to$430 million , compared to the original budget of$530 million . The revised cost reflects highly effective project management and execution, favourable weather conditions and productive contractor relationships. The project is trending on time, with all pump stations and pipeline construction completed as of the end of the first quarter of 2024. Pipeline and facility commissioning is currently underway and start-up is expected in the second quarter of 2024. -
The NEBC MPS Expansion includes a new mid-point pump station, terminal upgrades, and additional storage, which will support approximately 40,000 bpd of incremental capacity on the NEBC Pipeline system. This expansion is expected to cost
$90 million and will fulfill customer demand in light of growing production volumes from NEBC and previously announced long-term midstream service agreements with three premier NEBC Montney producers. The project is trending on time and on budget and is expected to enter service in the fourth quarter of 2024. Additionally, Pembina continues to evaluate further expansions to support volume growth in northeasternBritish Columbia , including new pipelines and terminal upgrades on the NEBC Pipeline and downstream systems betweenTaylor, British Columbia and Gordondale,Alberta . OnApril 23, 2024 , Pembina filed its project application with the Canada Energy Regulator.
Facilities
-
Pembina is constructing a new 55,000 bpd propane-plus fractionator ("RFS IV") at its existing
Redwater fractionation and storage complex (the "Redwater Complex "). RFS IV is expected to cost approximately$460 million and will leverage the design, engineering and operating best practices of its existing facilities. The project includes additional rail loading capacity at theRedwater Complex . Subject to regulatory and environmental approvals, RFS IV is expected to be in-service in the first half of 2026 and is currently trending on time and on budget. With the addition of RFS IV, the fractionation capacity at theRedwater Complex will total 256,000 bpd. Site clearing activities have been completed, engineering and procurement activities continue, and site construction is expected to begin in the second quarter of 2024. -
As previously disclosed, during the quarter PGI approved an expansion (the "Wapiti Expansion") that will increase natural gas processing capacity at the Wapiti Plant by 115 mmcf/d (gross to PGI). The Wapiti Plant is fully integrated into Pembina’s value chain and the liquids processed at the plant are transported on the Peace Pipeline system. The Wapiti Expansion is being driven by strong customer demand supported by growing
Montney production and will be fully underpinned by long-term, take-or-pay contracts.
The Wapiti Expansion, which includes a new sales gas pipeline and other related infrastructure, is expected to cost$230 million ($140 million net to Pembina) with an estimated in-service date in the first half of 2026, subject to regulatory and environmental approval. -
PGI is developing a 28 MW cogeneration facility at its K3 Plant (the "K3 Cogeneration Facility"), which is expected to cost
$115 million ($70 million net to Pembina). The K3 Cogeneration Facility is expected to reduce overall operating costs by providing power and heat to the gas processing facility, while reducing customers’ exposure to power prices. The K3 Cogeneration Facility is expected to fully supply the K3 Plant's power requirements, with excess power sold to the grid at market rates. Further, the K3 Cogeneration Facility is expected to contribute to a reduction in annual emissions compliance costs at the K3 Plant through the utilization of the cogeneration waste heat and the low-emission power generated and is expected to be in-service in the first half of 2026.
Marketing & New Ventures
-
Pembina has formed a partnership with the Haisla Nation ("Cedar LNG") to develop the Cedar LNG project (the "
Cedar LNG Project ") a proposed 3.3 million tonne per annum ("mtpa") floating liquified natural gas ("LNG") facility inKitimat, British Columbia , within the traditional territory of the Haisla Nation.The Cedar LNG Project will provide a valuable outlet for WCSB natural gas to access global markets and is expected to achieve higher prices for Canadian producers, contribute to lower overall global emissions, and enhance global energy security. Given it will be a floating LNG facility, manufactured in the controlled conditions of a shipyard, it is expected that theCedar LNG Project will have lower construction and execution risk. Further, powered by BC Hydro, theCedar LNG Project is expected to be one of the lowest emissions LNG facilities in the world.
Cedar LNG has secured a 20-year take-or-pay, fixed toll contract with ARC Resources for 1.5 mtpa of LNG. As part of the agreement, ARC Resources will supply Cedar LNG approximately 200 million cubic feet per day of natural gas via the Coastal GasLink pipeline from its production base in theMontney . Pembina has also entered into an identical bridging agreement with Cedar LNG for 1.5 mtpa of capacity. Commercial negotiations with multiple other potential customers continue to progress as Pembina plans to assign its capacity to a third-party following a positive final investment decision.
Following the finalization of the commercial tolling agreements and in order to maintain schedule, Cedar LNG issued a notice to proceed to Samsung Heavy Industries and Black & Veatch to continue the engineering, procurement, and construction for the design, fabrication and delivery of the floating LNG production unit. Cedar LNG has obtained a detailed Class III level capital cost estimate of approximatelyUS$3.4 billion (gross), includingUS$2.3 billion (gross), or approximately 70 percent, for the floating LNG production unit, which is being constructed under a fixed-price, lump-sum agreement, andUS$1.1 billion (gross) related to onshore infrastructure, owner’s costs, commissioning and start-up costs, financial assurances during construction, and other costs. The total project cost, includingUS$0.6 billion (gross) of interest during construction and transaction costs, is expected to be approximatelyUS$4.0 billion (gross).
Significant milestones have been completed to date and Cedar LNG is continuing to progress towards a final investment decision byJune 2024 , with an anticipated in-service date in late 2028. -
Pembina and TC Energy Corporation ("TC Energy") have formed a partnership to develop the Alberta Carbon Grid ("ACG"), a carbon transportation and sequestration platform. ACG is developing the Industrial Heartland project, which will have the potential to transport and store up to ten million tonnes of carbon dioxide annually. ACG completed the appraisal well drilling, logging and testing inDecember 2023 . Preliminary data was consistent with ACG’s storage capacity expectations and further work is underway to confirm the initial results. Throughout 2024, ACG will continue to progress commercial conversations, refine the project scope, and advance project engineering, including facility design and work on the pipeline routing.
First Quarter 2024 Conference Call & Webcast
Pembina will host a conference call on
A live webcast of the conference call can be accessed on Pembina's website at www.pembina.com under Investor Centre/ Presentation & Events, or by entering:
https://events.q4inc.com/attendee/415220818 in your web browser. Shortly after the call, an audio archive will be posted on the website for a minimum of 90 days.
Annual Meeting of Common Shareholders
The Company will hold its Annual Meeting of Common Shareholders ("AGM") on
2024 Investor Day
Pembina will hold an Investor Day on
About Pembina
Purpose of Pembina: We deliver extraordinary energy solutions so the world can thrive.
Pembina is structured into three Divisions: Pipelines Division, Facilities Division and Marketing & New Ventures Division.
Pembina's common shares trade on the
Forward-Looking Statements and Information
This news release contains certain forward-looking statements and forward-looking information (collectively, "forward-looking statements"), including forward-looking statements within the meaning of the "safe harbor" provisions of applicable securities legislation, that are based on Pembina's current expectations, estimates, projections and assumptions in light of its experience and its perception of historical trends. In some cases, forward-looking statements can be identified by terminology such as "continue", "anticipate", "will", "expects", "estimate", "potential", "planned", "future", "outlook", "strategy", "protect", "plan", "commit", "maintain", "focus", "ongoing", "believe" and similar expressions suggesting future events or future performance.
In particular, this news release contains forward-looking statements, including certain financial outlooks, pertaining to, without limitation, the following: future pipeline, processing, fractionation and storage facility and system operations and throughput levels; Pembina's strategy and the development of new business initiatives and growth opportunities, including the anticipated benefits therefrom and the expected timing thereof; expectations about industry activities and development opportunities, as well as the anticipated benefits thereof, including operating segment and general market conditions outlooks and industry developments for 2024 and thereafter; expectations about future demand for Pembina's infrastructure and services, including expectations in respect of customer contracts, future volume growth in the WCSB, increased utilization and future tolls and volumes; expectations relating to the development of Pembina's new projects and developments, including the Phase VIII Peace Pipeline expansion, the Cedar LNG project, RFS IV, ACG, the NEBC MPS Expansion, the Wapiti Expansion and the K3 Cogeneration Facility, including the timing and anticipated benefits thereof; expectations relating to the development and anticipated benefits of the
The forward-looking statements are based on certain factors and assumptions that Pembina has made in respect thereof as at the date of this news release regarding, among other things: oil and gas industry exploration and development activity levels and the geographic region of such activity; the success of Pembina's operations; prevailing commodity prices, interest rates, carbon prices, tax rates, exchange rates and inflation rates; the ability of Pembina to maintain current credit ratings; the availability and cost of capital to fund future capital requirements relating to existing assets, projects and the repayment or refinancing of existing debt as it becomes due; future operating costs; geotechnical and integrity costs; that any third-party projects relating to Pembina's growth projects will be sanctioned and completed as expected; assumptions with respect to our intention to complete share repurchases, including the funding thereof, existing and future market conditions, including with respect to Pembina's common share trading price, and compliance with respect to applicable securities laws and regulations and stock exchange policies; that any required commercial agreements can be reached in the manner and on the terms expected by Pembina; that all required regulatory and environmental approvals can be obtained on the necessary terms and in a timely manner; that counterparties will comply with contracts in a timely manner; that there are no unforeseen events preventing the performance of contracts or the completion of the relevant projects; prevailing regulatory, tax and environmental laws and regulations; maintenance of operating margins; the amount of future liabilities relating to lawsuits and environmental incidents; and the availability of coverage under Pembina's insurance policies (including in respect of Pembina's business interruption insurance policy).
Although Pembina believes the expectations and material factors and assumptions reflected in these forward-looking statements are reasonable as of the date hereof, there can be no assurance that these expectations, factors and assumptions will prove to be correct. These forward-looking statements are not guarantees of future performance and are subject to a number of known and unknown risks and uncertainties including, but not limited to: the regulatory environment and decisions and Indigenous and landowner consultation requirements; the impact of competitive entities and pricing; reliance on third parties to successfully operate and maintain certain assets; reliance on key relationships, joint venture partners and agreements; labour and material shortages; the strength and operations of the oil and natural gas production industry and related commodity prices; non-performance or default by counterparties to agreements which Pembina or one or more of its affiliates has entered into in respect of its business; actions by governmental or regulatory authorities, including changes in tax laws and treatment, changes in royalty rates, changes in regulatory processes or increased environmental regulation; the ability of Pembina to acquire or develop the necessary infrastructure in respect of future development projects; Pembina's ability to realize the anticipated benefits of the Alliance/Aux Sable Acquisition; fluctuations in operating results; adverse general economic and market conditions, including potential recessions in
This list of risk factors should not be construed as exhaustive. Readers are cautioned that events or circumstances could cause results to differ materially from those predicted, forecasted or projected by forward-looking statements contained herein. The forward-looking statements contained in this news release speak only as of the date of this news release. Pembina does not undertake any obligation to publicly update or revise any forward-looking statements or information contained herein, except as required by applicable laws. Management approved the updated 2024 adjusted EBITDA guidance contained herein on
Non-GAAP and Other Financial Measures
Throughout this news release, Pembina has disclosed certain financial measures and ratios that are not specified, defined or determined in accordance with GAAP and which are not disclosed in Pembina's financial statements. Non-GAAP financial measures either exclude an amount that is included in, or include an amount that is excluded from, the composition of the most directly comparable financial measure specified, defined and determined in accordance with GAAP. Non-GAAP ratios are financial measures that are in the form of a ratio, fraction, percentage or similar representation that has a non-GAAP financial measure as one or more of its components. These non-GAAP financial measures and non-GAAP ratios, together with financial measures and ratios specified, defined and determined in accordance with GAAP, are used by management to evaluate the performance and cash flows of Pembina and its businesses and to provide additional useful information respecting Pembina's financial performance and cash flows to investors and analysts.
In this news release, Pembina has disclosed the following non-GAAP financial measures and non-GAAP ratios: net revenue, adjusted EBITDA, adjusted EBITDA from equity accounted investees, adjusted EBITDA per common share, adjusted cash flow from operating activities, adjusted cash flow from operating activities per common share, and proportionately consolidated debt-to-adjusted EBITDA. The non-GAAP financial measures and non-GAAP ratios disclosed in this news release do not have any standardized meaning under International Financial Reporting Standards ("IFRS") and may not be comparable to similar financial measures or ratios disclosed by other issuers. Such financial measures and ratios should not, therefore, be considered in isolation or as a substitute for, or superior to, measures and ratios of Pembina's financial performance, or cash flows specified, defined or determined in accordance with IFRS, including revenue, earnings, cash flow from operating activities and cash flow from operating activities per share.
Except as otherwise described herein, these non-GAAP financial measures and non-GAAP ratios are calculated on a consistent basis from period to period. Specific reconciling items may only be relevant in certain periods.
Below is a description of each non-GAAP financial measure and non-GAAP ratio disclosed in this news release, together with, as applicable, disclosure of the most directly comparable financial measure that is determined in accordance with GAAP to which each non-GAAP financial measure relates and a quantitative reconciliation of each non-GAAP financial measure to such directly comparable GAAP financial measure. Additional information relating to such non-GAAP financial measures and non-GAAP ratios, including disclosure of the composition of each non-GAAP financial measure and non-GAAP ratio, an explanation of how each non-GAAP financial measure and non-GAAP ratio provides useful information to investors and the additional purposes, if any, for which management uses each non-GAAP financial measure and non-GAAP ratio; an explanation of the reason for any change in the label or composition of each non-GAAP financial measure and non-GAAP ratio from what was previously disclosed; and a description of any significant difference between forward-looking non-GAAP financial measures and the equivalent historical non-GAAP financial measures, is contained in the "Non-GAAP & Other Financial Measures" section of the management's discussion and analysis of Pembina dated
Net Revenue
Net revenue is a non-GAAP financial measure which is defined as total revenue less cost of goods. The most directly comparable financial measure to net revenue that is determined in accordance with GAAP and disclosed in Pembina's financial statements is revenue.
3 Months Ended |
Pipelines |
Facilities |
Marketing &
|
Corporate &
|
Total (1) |
|||||
($ millions) |
||||||||||
|
2024 |
2023 |
2024 |
2023 |
2024 |
2023 |
2024 |
2023 |
2024 |
2023 |
Revenue |
688 |
628 |
231 |
208 |
800 |
879 |
(179) |
(97) |
1,540 |
1,618 |
Cost of goods sold |
11 |
— |
— |
— |
751 |
740 |
(134) |
(58) |
628 |
682 |
Net revenue |
677 |
628 |
231 |
208 |
49 |
139 |
(45) |
(39) |
912 |
936 |
(1) |
Comparative 2023 period has been adjusted. See "Accounting Policies & Estimates - Change in Accounting Policies" in Pembina's Management's Discussion and Analysis dated |
|
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization
Adjusted EBITDA is a non-GAAP financial measure and is calculated as earnings before net finance costs, income taxes, depreciation and amortization (included in operations and general and administrative expense) and unrealized gains or losses from derivative instruments. The exclusion of unrealized gains or losses from derivative instruments eliminates the non-cash impact of such gains or losses.
Adjusted EBITDA also includes adjustments to earnings for losses (gains) on disposal of assets, transaction costs incurred in respect of acquisitions, dispositions and restructuring, impairment charges or reversals in respect of goodwill, intangible assets, investments in equity accounted investees and property, plant and equipment, certain non-cash provisions and other amounts not reflective of ongoing operations. These additional adjustments are made to exclude various non-cash and other items that are not reflective of ongoing operations.
Adjusted EBITDA per common share is a non-GAAP ratio which is calculated by dividing adjusted EBITDA by the weighted average number of common shares outstanding.
3 Months Ended |
Pipelines |
Facilities |
Marketing &
|
Corporate &
|
Total |
|||||
($ millions, except per share amounts) |
||||||||||
|
2024 |
2023 |
2024 |
2023 |
2024 |
2023 |
2024 |
2023 |
2024 |
2023 |
Earnings (loss) |
455 |
376 |
177 |
135 |
64 |
120 |
(167) |
(156) |
438 |
369 |
Income tax expense |
— |
— |
— |
— |
— |
— |
— |
— |
91 |
106 |
Adjustments to share of profit from equity accounted investees and other |
44 |
44 |
100 |
127 |
7 |
5 |
— |
— |
151 |
176 |
Net finance cost |
6 |
7 |
2 |
2 |
2 |
1 |
98 |
101 |
108 |
111 |
Depreciation and amortization |
95 |
99 |
33 |
34 |
15 |
12 |
13 |
10 |
156 |
155 |
Unrealized loss from derivative instruments |
— |
— |
— |
— |
102 |
34 |
— |
— |
102 |
34 |
Gain on disposal of assets and non-cash provisions |
(1) |
(1) |
(2) |
— |
(2) |
(3) |
3 |
— |
(2) |
(4) |
Adjusted EBITDA |
599 |
525 |
310 |
298 |
188 |
169 |
(53) |
(45) |
1,044 |
947 |
Adjusted EBITDA per common share – basic (dollars) |
|
|
|
|
|
|
|
|
1.90 |
1.72 |
2024 Adjusted EBITDA Guidance
The equivalent historical non-GAAP financial measure to 2024 adjusted EBITDA guidance is adjusted EBITDA for the year ended
12 Months Ended |
Pipelines |
Facilities |
Marketing &
|
Corporate &
|
Total |
($ millions, except per share amounts) |
|||||
Earnings (loss) |
1,840 |
610 |
435 |
(696) |
1,776 |
Income tax expense |
— |
— |
— |
— |
413 |
Adjustments to share of profit from equity accounted investees and other |
172 |
438 |
84 |
— |
694 |
Net finance costs |
28 |
9 |
4 |
425 |
466 |
Depreciation and amortization |
414 |
159 |
46 |
44 |
663 |
Unrealized loss from derivative instruments |
— |
— |
32 |
— |
32 |
Impairment reversal |
(231) |
— |
— |
— |
(231) |
Transaction costs incurred in respect of acquisitions, gain on disposal of assets and non-cash provisions |
11 |
(3) |
(4) |
7 |
11 |
Adjusted EBITDA |
2,234 |
1,213 |
597 |
(220) |
3,824 |
Adjusted EBITDA per common share – basic (dollars) |
|
|
|
|
6.95 |
Adjusted EBITDA from Equity Accounted Investees
In accordance with IFRS, Pembina's jointly controlled investments are accounted for using equity accounting. Under equity accounting, the assets and liabilities of the investment are presented net in a single line item in the Consolidated Statement of Financial Position, "Investments in Equity Accounted Investees". Net earnings from investments in equity accounted investees are recognized in a single line item in the Consolidated Statement of Earnings and Comprehensive Income "Share of Profit from Equity Accounted Investees". The adjustments made to earnings, in adjusted EBITDA above, are also made to share of profit from investments in equity accounted investees. Cash contributions and distributions from investments in equity accounted investees represent Pembina's share paid and received in the period to and from the investments in equity accounted investees.
To assist in understanding and evaluating the performance of these investments, Pembina is supplementing the IFRS disclosure with non-GAAP proportionate consolidation of Pembina's interest in the investments in equity accounted investees. Pembina's proportionate interest in equity accounted investees has been included in adjusted EBITDA.
3 Months Ended |
Pipelines |
Facilities |
Marketing &
|
Total |
||||
($ millions) |
||||||||
|
2024 |
2023 |
2024 |
2023 |
2024 |
2023 |
2024 |
2023 |
Share of profit (loss) from equity accounted investees |
43 |
35 |
75 |
48 |
33 |
(1) |
151 |
82 |
Adjustments to share of profit from equity accounted investees: |
|
|
|
|
|
|
|
|
Net finance costs |
6 |
5 |
27 |
53 |
— |
— |
33 |
58 |
Income tax expense |
— |
1 |
23 |
13 |
— |
— |
23 |
14 |
Depreciation and amortization |
38 |
38 |
49 |
55 |
7 |
5 |
94 |
98 |
Transaction costs incurred in respect of acquisitions and non-cash provisions |
— |
— |
1 |
6 |
— |
— |
1 |
6 |
Total adjustments to share of profit from equity accounted investees |
44 |
44 |
100 |
127 |
7 |
5 |
151 |
176 |
Adjusted EBITDA from equity accounted investees |
87 |
79 |
175 |
175 |
40 |
4 |
302 |
258 |
Adjusted Cash Flow from Operating Activities and Adjusted Cash Flow from Operating Activities per Common Share
Adjusted cash flow from operating activities is a non-GAAP financial measure which is defined as cash flow from operating activities adjusting for the change in non-cash operating working capital, adjusting for current tax and share-based compensation payment, and deducting preferred share dividends paid. Adjusted cash flow from operating activities deducts preferred share dividends paid because they are not attributable to common shareholders. The calculation has been modified to include current tax and share-based compensation payment as it allows management to better assess the obligations discussed below.
Management believes that adjusted cash flow from operating activities provides comparable information to investors for assessing financial performance during each reporting period. Management utilizes adjusted cash flow from operating activities to set objectives and as a key performance indicator of the Company's ability to meet interest obligations, dividend payments and other commitments.
Adjusted cash flow from operating activities per common share is a non-GAAP ratio which is calculated by dividing adjusted cash flow from operating activities by the weighted average number of common shares outstanding.
|
3 Months Ended |
|
($ millions, except per share amounts) |
2024 |
2023 |
Cash flow from operating activities |
436 |
458 |
Cash flow from operating activities per common share – basic (dollars) |
0.79 |
0.83 |
Add (deduct): |
|
|
Change in non-cash operating working capital |
188 |
199 |
Current tax expense |
(76) |
(99) |
Taxes paid, net of foreign exchange |
199 |
47 |
Accrued share-based payment expense |
(20) |
(20) |
Share-based compensation payment |
86 |
77 |
Preferred share dividends paid |
(31) |
(28) |
Adjusted cash flow from operating activities |
782 |
634 |
Adjusted cash flow from operating activities per common share – basic (dollars) |
1.42 |
1.15 |
Proportionately Consolidated Debt-to-Adjusted EBITDA
Proportionately Consolidated Debt-to-Adjusted EBITDA is a non-GAAP ratio that management believes is useful to investors and other users of Pembina’s financial information in the evaluation of the Company’s debt levels and creditworthiness.
|
12 Months Ended |
|
($ millions, except as noted) |
|
|
Loans and borrowings (current) |
550 |
650 |
Loans and borrowings (non-current) |
10,053 |
9,253 |
Loans and borrowings of equity accounted investees |
2,841 |
2,805 |
Proportionately consolidated debt |
13,444 |
12,708 |
Adjusted EBITDA |
3,921 |
3,824 |
Proportionately consolidated debt-to-adjusted EBITDA (times) |
— |
3.3 |
($ millions) |
12 Months
|
3 Months
|
12 Months
|
3 Months
|
Earnings before income tax |
2,243 |
529 |
2,189 |
475 |
Adjustments to share of profit from equity accounted investees and other |
669 |
151 |
694 |
176 |
Net finance costs |
463 |
108 |
466 |
111 |
Depreciation and amortization |
664 |
156 |
663 |
155 |
Unrealized loss on derivative instruments |
100 |
102 |
32 |
34 |
Gain on asset disposal |
2 |
(2) |
— |
(4) |
Transaction costs incurred in respect of acquisitions, transformation and restructuring costs, contract dispute settlement, (gain) loss on disposal of assets and non-cash provisions |
11 |
— |
11 |
— |
Impairment reversal |
(231) |
— |
(231) |
— |
Adjusted EBITDA |
3,921 |
1,044 |
3,824 |
947 |
|
=A+B-C |
A |
B |
C |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240509172858/en/
Investor Relations
(403) 231-3156
1-855-880-7404
e-mail: investor-relations@pembina.com
www.pembina.com
Source: