GEI Gibson Energy Inc.

Gibson Energy Announces 2024 Third Quarter Results and 2024 Record Crude Volumes at Edmonton Terminal

Gibson Energy Announces 2024 Third Quarter Results and 2024 Record Crude Volumes at Edmonton Terminal

All financial figures are in Canadian dollars unless otherwise noted

CALGARY, Alberta, Oct. 29, 2024 (GLOBE NEWSWIRE) -- Gibson Energy Inc. (TSX:GEI) ("Gibson" or the "Company") announced today its financial and operating results for the three and nine months ended September 30, 2024.

"Gibson delivered strong results in the third quarter, driven by the continued strength and stability of our Infrastructure segment, which now represents over 85% of our business, and saw 2024 record third party crude volumes at our Edmonton Terminal in the third quarter, driven by deliveries onto the Trans Mountain Expansion pipeline," said Curtis Philippon, President and Chief Executive Officer. "Since joining Gibson in August, I have had the opportunity to visit all of our operations. Gibson's critical energy infrastructure spans from touching one in four barrels produced in Western Canada to exporting Permian & Eagle Ford barrels through one of the largest crude export terminals in the United States. It is impressive to see firsthand our asset base and meet the passionate talented teams that support it."

Financial Highlights:

  • Revenue of $2,900 million in the third quarter, a $325 million or 10% decrease relative to the third quarter of 2023, due to lower revenues within the Marketing segment driven by Crude Marketing sales volume
  • Infrastructure adjusted EBITDA(1) of $150 million in the third quarter, a $10 million or 7% increase from the third quarter of 2023, primarily driven by a full quarter of contribution from the Gateway Terminal
  • Marketing adjusted EBITDA(1) of $14 million in the third quarter, a $10 million or 41% decrease from the third quarter of 2023, due to lower contributions from the Refined Products business resulting from compressed refining margins and the Crude Marketing business due to fewer opportunities
  • Adjusted EBITDA(1) on a consolidated basis of $151 million in the third quarter, a $2 million or 1% increase over the third quarter of 2023, as higher Infrastructure adjusted EBITDA(1) offset lower Marketing results
  • Net income of $54 million in the third quarter, a $33 million or 161% increase over the third quarter of 2023, primarily due to one-time transaction and finance costs incurred in relation to the acquisition of the Gateway Terminal in the comparative period, and the factors noted above, partially offset by higher depreciation, amortization, income tax expense and foreign exchange losses
  • Distributable cash flow(1) of $88 million in the third quarter, a $5 million or 5% decrease from the third quarter of 2023, primarily due to higher current income tax expense
  • Dividend payout ratio(2) on a trailing twelve-month basis of 65%, below the Company’s 70% – 80% target
  • Net debt to adjusted EBITDA ratio(2) at September 30, 2024 of 3.2x, within the Company’s 3.0x – 3.5x target

Strategic Developments and Highlights:

  • On July 15, 2024, Gibson announced the extension of a long-term contract with an investment grade global E&P company at its Gateway Terminal which further enhanced the quality of the Company's cash flows, as well as the sanction of a connection to the Cactus II Pipeline, providing customers with access to up to approximately 700,000 barrels per day of incremental supply

(1) Adjusted EBITDA and distributable cash flow are non-GAAP financial measures. See the “Specified Financial Measures” section of this release.

(2) Net debt to adjusted EBITDA ratio and dividend payout ratio are non-GAAP financial ratios. See the “Specified Financial Measures” section of this release.

Management’s Discussion and Analysis and Financial Statements

The 2024 third quarter Management’s Discussion and Analysis and unaudited Condensed Consolidated Financial Statements provide a detailed explanation of Gibson’s financial and operating results for the three months and nine months ended September 30, 2024, as compared to the three months and nine months ended September 30, 2023. These documents are available at and on SEDAR+ at .

Earnings Conference Call & Webcast Details

A conference call and webcast will be held to discuss the 2024 third quarter financial and operating results at 7:00am Mountain Time (9:00am Eastern Time) on Wednesday, October 30, 2024.

To register for the call, view dial-in numbers, and obtain a dial-in PIN, please access the following URL:

Registration at least five minutes prior to the conference call is recommended. 

This call will also be broadcast live on the Internet and may be accessed directly at the following URL:

The webcast will remain accessible for a 12-month period at the above URL.

Supplementary Information

Gibson has also made available certain supplementary information regarding the 2024 third quarter financial and operating results, available at .

About Gibson

Gibson is a leading liquids infrastructure company with its principal businesses consisting of the storage, optimization, processing, and gathering of liquids and refined products. Headquartered in Calgary, Alberta, the Company's operations are located across North America, with core terminal assets in Hardisty and Edmonton, Alberta, Ingleside, Texas, and a facility in Moose Jaw, Saskatchewan.

Gibson shares trade under the symbol GEI and are listed on the Toronto Stock Exchange. For more information, visit .

Forward-Looking Statements

Certain statements contained in this press release constitute forward-looking information and statements (collectively, forward-looking statements). All statements other than statements of historical fact are forward-looking statements. The use of any of the words ‘‘anticipate’’, ‘‘plan’’, ‘‘contemplate’’, ‘‘continue’’, ‘‘estimate’’, ‘‘expect’’, ‘‘intend’’, ‘‘propose’’, ‘‘might’’, ‘‘may’’, ‘‘will’’, ‘‘shall’’, ‘‘project’’, ‘‘should’’, ‘‘could’’, ‘‘would’’, ‘‘believe’’, ‘‘predict’’, ‘‘forecast’’, ‘‘pursue’’, ‘‘potential’’ and ‘‘capable’’ and similar expressions are intended to identify forward looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. No assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon. These statements speak only as of the date of this press release. The Company does not undertake any obligations to publicly update or revise any forward-looking statements except as required by securities law. Actual results could differ materially from those anticipated in these forward-looking statements as a result of numerous risks and uncertainties including, but not limited to, the risks and uncertainties described in “Forward-Looking Information” and “Risk Factors” included in the Company's Annual Information Form and Management's Discussion and Analysis, each dated February 20, 2024, as filed on SEDAR+ and available on the Gibson website at .

For further information, please contact:

Investor Relations:

(403) 776-3077

Media Relations:

(403) 476-6334

Specified Financial Measures

This press release refers to certain financial measures that are not determined in accordance with GAAP, including non-GAAP financial measures and non-GAAP financial ratios. Readers are cautioned that non-GAAP financial measures and non-GAAP financial ratios do not have standardized meanings prescribed by GAAP and, therefore, may not be comparable to similar measures presented by other entities. Management considers these to be important supplemental measures of the Company’s performance and believes these measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in industries with similar capital structures.

For further details on these specified financial measures, including relevant reconciliations, see the "Specified Financial Measures" section of the Company’s MD&A for the three and nine months ended September 30, 2024 and 2023, which is incorporated by reference herein and is available on Gibson's SEDAR+ profile at and Gibson's website at .

a) Adjusted EBITDA

Noted below is the reconciliation to the most directly comparable GAAP measures of the Company’s segmented and consolidated adjusted EBITDA for the three and nine months ended September 30, 2024, and 2023:

Three months ended September 30,InfrastructureMarketingCorporate and AdjustmentsTotal
($ thousands)2024 2023 2024 2023 2024 2023 2024 2023 
            
Segment profit150,271 137,727 14,183 17,900   164,454 155,627 
Unrealized (gain) loss on derivative financial instruments(1,553)740 25 6,059   (1,528)6,799 
General and administrative    (13,004)(14,258)(13,004)(14,258)
Adjustments to share of profit from equity accounted investees1,166 1,432     1,166 1,432 
Executive transition costs      251  251  
Renewable power purchase agreement    (175) (175) 
Other        
Adjusted EBITDA149,884 139,899 14,208 23,959 (12,928)(14,258)151,164 149,600 
            

 

Nine months ended September 30,InfrastructureMarketingCorporate and AdjustmentsTotal
($ thousands)2024 2023 2024 2023 2024 2023 2024 2023 
           
Segment profit446,566 336,483 69,391 123,962   515,957 460,445 
Unrealized loss (gain) on derivative financial instruments3,746 740 (1,884)(6,872)  1,862 (6,132)
General and administrative    (51,920)(38,677)(51,920)(38,677)
Adjustments to share of profit from equity accounted investees4,071 4,293     4,071 4,293 
Executive transition costs    10,665  10,665  
Renewable power purchase agreement    (175) (175) 
Other     218  218 
Adjusted EBITDA454,383 341,516 67,507 117,090 (41,430)(38,459)480,460 420,147 
                 

 

 Three months ended September 30,

 
($ thousands)2024 2023 
   
Net Income53,916 20,633 
   
Income tax expense14,573 7,678 
Depreciation, amortization, and impairment charges44,289 38,542 
Finance costs, net32,545 50,222 
Unrealized (gain) loss on derivative financial instruments(1,528)6,799 
Corporate unrealized (gain) loss on derivative financial instruments (1)(1,934)430 
Stock based compensation4,747 6,455 
Acquisition and integration costs 19,959 
Adjustments to share of profit from equity accounted investees1,166 1,432 
Corporate foreign exchange loss (gain) and other3,139 (2,550)
Executive transition costs251  
Adjusted EBITDA151,164 149,600 
     

 

 Nine months ended September 30,

 
($ thousands)2024 2023 
    
Net Income157,737 160,910 
    
Income tax expense46,205 50,864 
Depreciation, amortization, and impairment charges131,452 94,788 
Finance costs, net104,285 80,357 
Unrealized loss (gain) on derivative financial instruments1,862 (6,132)
Corporate unrealized loss (gain) on derivative financial instruments (1)6,707 430 
Stock based compensation15,158 15,344 
Acquisition and integration costs1,371 19,959 
Adjustments to share of profit from equity accounted investees4,071 4,293 
Corporate foreign exchange loss (gain) and other947 (666)
Executive transition costs10,665  
Adjusted EBITDA480,460 420,147 
     

b) Distributable Cash Flow

The following is a reconciliation of distributable cash flow from operations to its most directly comparable GAAP measure, cash flow from operating activities:

 Three months ended September 30,

 Nine months ended September 30,

 
($ thousands)2024 2023 2024 2023 
     
Cash flow from operating activities404,794 190,015 531,178 419,254 
Adjustments:    
Changes in non-cash working capital and taxes paid(258,264)(61,420)(64,620)(14,921)
Replacement capital(13,023)(12,876)(24,260)(25,702)
Cash interest expense, including capitalized interest(34,045)(32,290)(102,405)(65,677)
Acquisition and integration costs (1) 19,959 1,371 19,959 
Executive transition costs7,433  10,665  
Lease payments(8,144)(8,575)(24,178)(26,268)
Current income tax(10,582)(1,860)(23,633)(23,800)
Distributable cash flow88,169 92,953 304,118 282,845 
         

 

Twelve months ended September 30,

 
($ thousands)2024 2023 
   
Cash flow from operating activities686,780 489,312 
Adjustments:  
Changes in non-cash working capital and taxes paid(57,133)47,812 
Replacement capital(34,486)(32,559)
Cash interest expense, including capitalized interest(136,861)(81,966)
Acquisition and integration costs (1)3,454 19,959 
Executive transition costs10,665  
Lease payments(33,806)(34,035)
Current income tax(31,550)(37,218)
Distributable cash flow407,063 371,305 
     

c) Dividend Payout Ratio

Twelve months ended September 30,

 
 2024 2023 
Distributable cash flow407,063 371,305 
Dividends declared263,050 226,755 
Dividend payout ratio65%61%
     

d) Net Debt To Adjusted EBITDA Ratio

 Twelve months ended September 30,

 
 2024 2023 
   
Current and long-term debt2,528,454 2,645,904 
Lease  liabilities50,246 67,862 
Less: unsecured hybrid debt(450,000)(450,000)
Less: cash and cash equivalents(55,584)(54,464)
   
Net debt2,073,116 2,209,302 
Adjusted EBITDA650,141 557,481 
Net debt to adjusted EBITDA ratio3.2 4.0 
     



EN
29/10/2024

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