By Robb M. Stewart

TC Energy scaled back the cost estimate for a big project in Mexico and is now targeting underlining earnings at the top end of its forecast range after swinging to a profit in the latest quarter.

Bolstered by a rebound in its Canadian natural gas pipelines business, the Canadian owner of natural gas and crude oil pipelines and nuclear power facilities on Thursday reported net income of 1.48 billion Canadian dollars ($1.18 billion), or C$1.40 a share, compared with a year-earlier loss of C$173 million, or C$0.19.

Comparable earnings before interest, tax, depreciation and amortization--a measure of profit followed by industry analysts--were 6% higher at C$2.79 billion. That was slightly ahead of the C$2.75 billion mean forecast of analysts polled by FactSet.

First-quarter revenue rose 3.6% to C$4.08 billion.

TC Energy said it now anticipates comparable Ebitda for the full year will be at the upper end of its expected C$11.2 billion to C$11.5 billion range, which excluding the recent spinoff of a chunk of its business equates to C$9.9 billion to C$10.1 billion.

TC Energy last month completed a spinoff to its shareholders of its liquids pipelines business, which is now known as South Bow. With the exit from South Bow, the company reduced its longterm debt by about C$7.6 billion in October.

President and Chief Executive Francois Poirier said the company's Southeast Gateway marine pipeline project in Mexico is making progress toward commercial in-service no later than the middle of next year, and TC Energy now expects capital expenditures associated with the project to be between $3.9 billion to $4.1 billion, which at the midpoint is about 11% below the original cost estimate.

The company's overall capital expenditure for this year is now set to come in about 8% lower at the mid-point of earlier expectations, at C$7.4 billion to C$7.7 billion.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

November 07, 2024 07:20 ET (12:20 GMT)

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