• Dividend: Declared at $0.2925 per share, annualized to $1.17, up 2% from last year.
• Net Income: $717 million, down 4% from the previous year.
• Earnings Per Share (EPS): $0.32, down $0.01 from last year.
• Adjusted Net Income: $766 million, up 1% from last year.
• Adjusted EPS: $0.34, flat compared to last year.
• Net Debt: $32.8 billion, with a net debt to adjusted EBITDA ratio of 4.1 times.
• Natural Gas Demand: Record demand with a 6.8 Bcf/day increase, driven by a 10% rise in residential and commercial demand and a 15% increase in LNG demand.
• Project Backlog: Increased by $900 million, totaling $8.8 billion.
• Transport Volumes: Up 3% compared to Q1 2024.
• Gathering Volumes: Down 6% compared to Q1 2024.
• Refined Products Volumes: Up 2% compared to Q1 2024.
• Crude and Condensate Volumes: Up 4% compared to Q1 2024.
• Liquids Lease Capacity: High at 94%.
• Jones Act Tanker Fleet: 97% leased through 2025.
• CO2 Segment Oil Production: Slightly lower by 1% compared to Q1 2024.
• Adjusted EBITDA Growth: Expected to increase to 5% with the Outrigger acquisition.
• Full-Year Net Debt to Adjusted EBITDA: Expected to end at 3.8 times.

• Warning! GuruFocus has detected 10 Warning Signs with KMI.

Release Date: April 16, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Kinder Morgan Inc (NYSE:KMI) reported strong natural gas performance, with record demand driven by a 10% increase in residential and commercial demand and a 15% increase in LNG demand.
• The company added approximately $900 million to its project backlog, with over 70% focused on serving power demand, indicating strong future growth potential.
• KMI's financial results were in line with expectations, and the company expects to exceed its budget for the year, partly due to the Outrigger acquisition.
• The company has a resilient business model, with almost two-thirds of EBITDA generated from take-or-pay contracts, providing stability amid market volatility.
• KMI's strategic positioning with 70,000 miles of gas pipelines and a significant presence in key demand areas like the Gulf Coast and Southeastern United States supports future expansion opportunities.

Negative Points

• There is uncertainty regarding the impact of tariffs on project economics, although KMI has taken steps to mitigate potential effects.
• Natural gas gathering volumes were down 6% in the quarter compared to the first quarter of 2024, primarily due to lower Haynesville production.
• The company experienced a 4% decline in net income attributable to KMI, partly due to unfavorable mark-to-market on hedges.
• KMI's gathering business, which is roughly 8% of its overall business, faces potential challenges if oil prices remain low, affecting producer activity.
• The company is cautious about the potential impact of economic volatility and commodity price fluctuations on its outlook for the year.

Q & A Highlights

Q: Can you discuss the potential additional gas pipeline investments with utilities and data centers? How has the pace of discussions with customers evolved since the last earnings call? A: Sital Mody, Vice President, President - Natural Gas Pipelines, mentioned that the activity level is strong, with significant competition. Kinder Morgan is well-positioned, particularly with the Bridge project into South Carolina, which is a step towards growth in power and data center opportunities. Kimberly Dang, CEO, added that 70% of the backlog additions this quarter are related to power, and 50% of the overall backlog is power-related, indicating strong activity in the sector.

Q: What is the progress in Arizona regarding pipeline expansion or new projects? A: Sital Mody stated that there is a recognized need in the Southwest, including Arizona, and Kinder Morgan is pursuing both brownfield and greenfield opportunities. While in a competitive situation, there is interest and a need for incremental capacity in the region.

Q: With WTI prices dipping, how might this impact producer activity and Kinder Morgan's business? A: Kimberly Dang noted that the gathering business is a small part of Kinder Morgan's overall business. Conversations with producers have not indicated changes yet. In the Haynesville, a dry natural gas play, discussions have been more bullish, with potential for adding rigs beyond previous expectations. Sital Mody added that Kinder Morgan's assets are in Tier 1 areas, which have historically withstood price volatility well.

Q: Are you seeing any early signs of recessionary demand in your markets? A: Kimberly Dang reported that demand is holding up well, with refined products volumes up 2% and strong natural gas demand. The expectation is for continued strong and growing natural gas demand, driven by LNG exports and storage refill needs, which are less susceptible to recessionary pressures.

Q: Can you provide more details about the new Bridge project and its potential for expansion? A: Sital Mody indicated that South Carolina is experiencing rapid growth in power demand, with potential data center opportunities. The Bridge project establishes a platform for future growth, and while expansion possibilities are great, timing will depend on customer demand.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.