Cheniere(LNG) - 2025 Q2 - Quarterly Results

Financial Performance and Outlook Cheniere reported strong Q2 2025 financial results, updated full-year guidance positively, and detailed performance drivers, including CEO commentary on strategic achievements Second Quarter 2025 Financial Highlights Cheniere reported strong Q2 2025 financial results, with significant year-over-year growth in revenues, net income, Adjusted EBITDA, and Distributable Cash Flow Q2 & H1 2025 Financial Summary | (in billions) | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | Revenues | $4.6 | $10.1 | | Net Income | $1.6 | $2.0 | | Consolidated Adjusted EBITDA | $1.4 | $3.3 | | Distributable Cash Flow | $0.9 | $2.2 | Full Year 2025 Financial Guidance The company updated its full-year 2025 financial guidance, tightening the range for Adjusted EBITDA and raising and tightening Distributable Cash Flow Revised Full Year 2025 Guidance | (in billions) | 2025 Previous | 2025 Revised | | :--- | :--- | :--- | | Consolidated Adjusted EBITDA | $6.5 - $7.0 | $6.6 - $7.0 | | Distributable Cash Flow | $4.1 - $4.6 | $4.4 - $4.8 | - The updated guidance reflects a tightening of the Consolidated Adjusted EBITDA range and an increase and tightening of the Distributable Cash Flow range[7] Detailed Financial Results Review Q2 2025 revenues increased by 43% and net income by 85% year-over-year, driven by derivative fair value changes and higher LNG margins Q2 & H1 2025 vs 2024 Performance | (in millions) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenues | $4,641 | $3,251 | 43% | | Net income | $1,626 | $880 | 85% | | Consolidated Adjusted EBITDA | $1,416 | $1,322 | 7% | - The increase in net income for Q2 2025 was primarily due to an $873 million favorable variance from changes in the fair value of derivative instruments compared to Q2 2024[12] - The increase in Consolidated Adjusted EBITDA was mainly driven by higher total margins per MMBtu of LNG, partially offset by higher operating expenses from planned maintenance and new capacity[12] CEO Commentary CEO Jack Fusco highlighted strong Q2 performance, including the CCL Midscale Trains 8 & 9 FID and Sabine Pass maintenance, enabling revised full-year guidance and continued growth focus - Key achievements in Q2 2025 include the positive FID on the CCL Midscale Trains 8 & 9 Project and the completion of a large-scale planned maintenance at Sabine Pass[10] - The company's focus for the remainder of the year includes growing its brownfield platform and bringing new capacity at Corpus Christi online ahead of schedule and on budget[10] Capital Management and Liquidity Cheniere actively managed its capital allocation in H1 2025, deploying $2.6 billion towards growth, debt reduction, and shareholder returns, while maintaining strong liquidity Capital Allocation Cheniere deployed $2.6 billion in H1 2025 for growth, debt repayment, and shareholder returns, including a 10% dividend increase effective Q3 2025 - In the first six months of 2025, Cheniere deployed $2.6 billion towards growth, balance sheet management, and shareholder returns[6] - Shareholder returns in H1 2025 included repurchasing 3.0 million shares for $656 million and paying dividends totaling $223 million[6] - The company announced an increase in its quarterly dividend by over 10% to $2.22 per common share annualized, starting in Q3 2025[11] Balance Sheet and Liquidity As of June 30, 2025, Cheniere maintained $9.7 billion in total available liquidity and actively managed debt through new issuances and repayments Available Liquidity as of June 30, 2025 | (in millions) | Amount | | :--- | :--- | | Cash and cash equivalents | $1,648 | | Restricted cash and cash equivalents | $369 | | Available commitments under credit facilities | $7,685 | | Total available liquidity | $9,702 | - In July 2025, Cheniere Partners issued $1.0 billion of 5.550% Senior Notes due 2035 to redeem $1.0 billion of 5.875% Senior Secured Notes due 2026[16] - During H1 2025, SPL repaid the remaining $300 million of its 5.625% Senior Secured Notes due 2025 with cash on hand[17] Operational and Project Updates Cheniere secured new long-term commercial agreements, increased its LNG production forecast, and advanced multiple liquefaction expansion projects at Sabine Pass and Corpus Christi Recent Commercial and Growth Highlights Cheniere secured new long-term commercial agreements, increased its run-rate LNG production forecast by over 10%, and expects to generate over $25 billion in available cash through 2030 - The company increased its run-rate LNG production forecast by over 10% and expects to generate over $25 billion of available cash through 2030[11] - Entered a 15-year IPM gas supply agreement with Canadian Natural Resources for 140,000 MMBtu/day, equivalent to approximately 0.85 mtpa of LNG[11] - Signed a long-term SPA with JERA to supply approximately 1.0 mtpa of LNG from 2029 through 2050[11] Liquefaction Projects Overview Cheniere is advancing multiple liquefaction expansion projects at Sabine Pass and Corpus Christi, achieving key milestones including CCL Stage 3 Train 2 completion and FID for Midscale Trains 8 & 9 Sabine Pass LNG (SPL) Projects The operational SPL Project has over 30 mtpa capacity, with an expansion project under development expected to add up to 20 mtpa in a two-phased approach - The operational SPL Project has a total production capacity of over 30 mtpa of LNG[18] - The SPL Expansion Project is being developed with an expected peak production capacity of up to ~20 mtpa. Its FERC application was updated in June 2025 to reflect a two-phased project[19] Corpus Christi LNG (CCL) Projects The CCL Project has over 18 mtpa operational capacity, with Stage 3 86.7% complete, FID for Midscale Trains 8 & 9 adding ~5 mtpa, and Stage 4 Expansion pre-filing initiated for ~24 mtpa - The CCL Stage 3 Project was 86.7% complete as of June 30, 2025, with substantial completion for all seven trains expected between 2H 2025 and 2H 2026[21] - A positive Final Investment Decision (FID) was made in June 2025 for the CCL Midscale Trains 8 & 9 Project, which will add approximately 5 mtpa of production capacity[11][22][23] - The pre-filing review process with FERC was initiated in July 2025 for the CCL Stage 4 Expansion Project, which has an expected peak production capacity of up to ~24 mtpa[24] LNG Volume Summary As of August 1, 2025, Cheniere exported approximately 4,220 cumulative LNG cargoes, with 550 TBtu exported in Q2 2025 - As of August 1, 2025, a cumulative total of approximately 4,220 LNG cargoes, totaling ~290 million tonnes, have been exported from Cheniere's projects[32] LNG Volumes Recognized (in TBtu) | | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | Operational Volumes | 550 | 1,159 | | Commissioning Volumes | 1 | 6 | | Total Volumes Recognized | 551 | 1,165 | Financial Statements This section presents Cheniere's consolidated statements of operations and balance sheets, highlighting significant revenue growth, increased net income, and a strengthened equity position Consolidated Statements of Operations Q2 2025 saw total revenues of $4.64 billion, income from operations more than doubled to $2.53 billion, and net income attributable to Cheniere reached $1.63 billion Q2 2025 vs Q2 2024 Statement of Operations (in millions) | | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total revenues | $4,641 | $3,251 | | Income from operations | $2,530 | $1,588 | | Net income attributable to Cheniere | $1,626 | $880 | | Diluted EPS | $7.30 | $3.84 | Consolidated Balance Sheets As of June 30, 2025, total assets were $44.58 billion, total liabilities decreased to $33.27 billion, and total stockholders' equity increased to $11.25 billion Balance Sheet Summary (in millions) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total current assets | $3,704 | $4,801 | | Total assets | $44,578 | $43,858 | | Total current liabilities | $3,775 | $4,441 | | Total liabilities | $33,269 | $33,798 | | Total stockholders' equity | $11,251 | $10,053 | Reconciliation of Non-GAAP Measures This section provides detailed reconciliations of non-GAAP financial measures, specifically Consolidated Adjusted EBITDA and Distributable Cash Flow, to their most directly comparable GAAP measures Reconciliation of Consolidated Adjusted EBITDA Q2 2025 Consolidated Adjusted EBITDA was $1.42 billion, reconciled from income from operations by adjusting for depreciation and derivative fair value changes Q2 2025 Reconciliation to Consolidated Adjusted EBITDA (in millions) | | Three Months Ended June 30, 2025 | | :--- | :--- | | Income from operations | $2,530 | | Depreciation, amortization and accretion expense | $329 | | Gain from changes in fair value of derivatives, net | ($1,479) | | Other adjustments | $36 | | Consolidated Adjusted EBITDA | $1,416 | - Consolidated Adjusted EBITDA is calculated by adjusting net income for interest, taxes, depreciation, and certain non-cash or non-operating items to assess the financial performance of assets[42][44] Reconciliation of Distributable Cash Flow Q2 2025 Distributable Cash Flow was $0.92 billion, derived from Consolidated Adjusted EBITDA after accounting for interest, capital expenditures, taxes, and non-controlling interests Q2 2025 Reconciliation to Distributable Cash Flow (in billions) | | Three Months Ended June 30, 2025 | | :--- | :--- | | Consolidated Adjusted EBITDA | $1.42 | | Interest expense, net | ($0.19) | | Maintenance capital expenditures | ($0.06) | | Income tax (excludes deferred taxes) | ($0.02) | | Other | ($0.02) | | Consolidated Distributable Cash Flow | $1.13 | | Attributable to non-controlling interests | ($0.20) | | Cheniere Distributable Cash Flow | $0.92 | - Distributable Cash Flow is a performance measure used to evaluate the ability of assets to generate cash earnings after servicing debt, paying cash taxes, and funding sustaining capital[48]