Kinder Morgan misses estimates, lowers annual profit forecast on weak prices
Adds comments from conference call in paragraphs 3 and 13, updates shares in paragraph 2
By Sourasis Bose
Oct 16 (Reuters) -Kinder Morgan KMI.N fell short of Wall Street estimates for third-quarter profit on Wednesday and lowered its annual forecast as the U.S. pipeline operator contends with weaker commodity prices and lower crude volumes.
Shares of the company, whose pipelines move about 40% of total U.S. natural gas production, fell 2.6% in extended trade.
"For the full year, we expect refined product volumes to be slightly below our plan to 2% over 2023," President Thomas Martin said in a conference call.
U.S. WTI crude oil prices Clc1 declined about 8.1% during the third quarter from a year earlier and concerns persist over global demand.
Crude and condensate volumes fell 4% from the year-ago quarter, while natural gas transported rose 2%.
The company projected annual adjusted core profit to be 2% below its prior forecast, compared to previous expectations of in line or within 1-2% below.
Kinder Morgan also cited start-up delays at its renewable natural gas facilities for the revised forecast.
The company, like many U.S. energy peers, is pinning its hopes on the artificial intelligence boom-driven data center power need to buoy natural gas sales.
"Data center demand has skyrocketed," CEO Kimberly Dang said. The overall gas market could grow by 25 billion cubic feet per day over the next five years, she said.
The company said the Gulf Coast Express Pipeline, which it operates and holds a stake in, has green-lighted an about $455 million expansion project that would raise natural gas deliveries by 570 million cubic feet per day from the Permian Basin to South Texas markets.
Kinder Morgan posted an adjusted profit of 25 cents per share, compared with analysts' average expectation of 27 cents, according to estimates compiled by LSEG.
At its products pipelines unit, which includes refined products, adjusted core profit decreased about 11.5% to $277 million.
The company is working with agencies to defend its permits related to the Cumberland gas pipeline project in Tennessee after a U.S. appeals court put them on hold.
Reporting by Sourasis Bose in Bengaluru; Editing by Sriraj Kalluvila
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
