Kinder Morgan Lifts Dividend as LNG Boom Powers 16% EPS Gain

Core Insights - Kinder Morgan declared a third-quarter cash dividend of $0.2925 per share, reflecting a 16% year-over-year increase in adjusted EPS to $0.29, driven by U.S. LNG growth and resilient pipeline volumes [1] - The company reported adjusted EBITDA of $1.991 billion, a 6% increase from the previous year, and adjusted net income of $648 million, while GAAP net income remained flat at $628 million [1] Financial Performance - Cash flow from operations reached $1.4 billion, with free cash flow after capital expenditures approximately $0.6 billion, and net debt to adjusted EBITDA at 3.9x [3] - Fitch upgraded Kinder Morgan's senior unsecured rating to BBB+, indicating stable leverage and internally funded growth [3] Operational Highlights - Natural Gas Pipelines segment saw a 6% increase in transport volumes and a 9% rise in gathering volumes, aided by higher transport on Tennessee Gas Pipeline and Texas Intrastate system [2] - Products Pipelines experienced improved tariffs, although refined products throughput decreased by 1% and crude and condensate fell by 3% [2] - Terminal earnings increased due to stronger liquids storage and firmer Jones Act tanker rates, despite softer bulk activity [2] Growth Prospects - Kinder Morgan has a $9.3 billion project backlog, with approximately 90% focused on natural gas [4] - Long-term contracted LNG feedgas deliveries are expected to rise from nearly 8 Bcf/d to almost 12 Bcf/d by the end of 2028 [4] - Total U.S. gas demand is projected to increase by roughly 20% by 2030, driven by LNG exports and power sector needs [4] - Key projects include the Trident Intrastate line, Mississippi Crossing expansion, and SNG/EEC South System Expansion [4]