Kinder Morgan raises dividend by 25%, announces Q1 2019 results
Kinder Morgan, Inc. (NYSE: KMI) on April 17 announced that its Board of Directors approved a cash dividend of $0.25 per share for the first quarter ($1.00 annualized) payable on May 15, 2019, to common stockholders of record as of the close of business on April 30, 2019. This is a 25 percent increase over the fourth quarter 2018 dividend. KMI is reporting first quarter net income available to common stockholders of $556 million, compared to $485 million in the first quarter of 2018; and distributable cash flow (DCF) of $1,371 million, a 10 percent increase over the first quarter of 2018. In the first quarter of 2019, KMI continued to fund most of its growth capital through operating cash flows with no need to access capital markets for that purpose. During the first quarter KMI also paid down $1.3 billion of maturing bond debt with cash from the return of capital distribution from the Trans Mountain sale.
As noted above, KMI reported first quarter net income available to common stockholders of $556 million, compared to $485 million for the first quarter of 2018, and DCF of $1,371 million, up 10 percent from $1,247 million for the comparable period in 2018. These increases were due to greater contributions from the Natural Gas Pipelines segment, and lower preferred equity dividend payments, partially offset by the elimination of Kinder Morgan Canada earnings following the Trans Mountain sale and reduced contributions from our CO2 segment. KMI’s project backlog for the first quarter stood at $6.1 billion, approximately $400 million more than the fourth quarter of 2018, with additions of approximately $600 million in new projects, primarily in the Natural Gas Pipelines segment, offset by approximately $200 million in projects placed in service and other project capital adjustments. Excluding the CO2 segment projects, KMI expects projects in the backlog to generate an average Project EBITDA multiple of approximately 5.5 times.
For 2019, KMI’s budget contemplates declared dividends of $1.00 per common share, DCF of approximately $5.0 billion ($2.20 per common share) and Adjusted EBITDA of approximately $7.8 billion. Adjusted EBITDA is likely to be slightly below budget while DCF is expected to be on budget as lower interest expense offsets the slightly lower Adjusted EBITDA. KMI budgeted to invest $3.1 billion in growth projects and contributions to joint ventures during 2019. KMI expects to use internally generated cash flow to fully fund its 2019 dividend payments as well as the vast majority of its 2019 discretionary s