AltaGas (ALA) Q3 2024 earnings summary

Executive summary

• Normalized EBITDA rose 17% year-over-year to $294 million in Q3 2024, driven by Utilities strength and record LPG exports to Asia at 128,272 Bbl/d, up 9% year-over-year, despite operational challenges from wildfires and rail strikes.

• Normalized EPS increased to $0.14 from $0.08 year-over-year; GAAP EPS was $0.03 versus a loss of $0.18 in Q3 2023.

• Utilities segment outperformed expectations, benefiting from pension plan settlement, capital investments, cost controls, and regulatory progress.

• Midstream segment maintained robust performance with double-digit growth in gas processing, fractionation, and extraction volumes, offset by higher G&A and lower MVP contributions.

• Major projects REEF and Pipestone II are progressing on time and on budget, with strong construction and commercial momentum.

Financial highlights

• Q3 2024 normalized EBITDA was $294 million, up from $252 million in Q3 2023 (+17% year-over-year).

• Normalized EPS was $0.14 (Q3 2024) vs. $0.08 (Q3 2023); GAAP EPS was $0.03 vs. $(0.18).

• Utilities normalized EBITDA grew 65% year-over-year to $117 million, reflecting modernization investments and pension settlement gains.

• Midstream normalized EBITDA was $181 million (Q3 2024) vs. $185 million (Q3 2023), with record LPG exports and higher volumes offset by lower MVP earnings.

• Q3 2024 revenue was $2,759 million, down from $3,030 million in Q3 2023.

Outlook and guidance

• 2024 normalized EBITDA expected at the upper end of $1,675–$1,775 million guidance; normalized EPS near midpoint of $2.05–$2.25.

• 2024 capital budget remains at $1.3 billion, with 53% allocated to Utilities and 43% to Midstream.

• Anticipates continued strong growth in the Montney region, robust long-term demand from data centers, and LNG export-driven opportunities.

• Targeting 60% of export volumes under long-term tolling agreements by 2027 NGL year.

• Management targets lower leverage ratios and steady dividend growth.