Keyera (KEY) Q3 2024 earnings summary

Executive summary

• Achieved net earnings of $185 million in Q3 2024, up from $78 million in Q3 2023, with strong performance across all business segments and disciplined execution of strategy.

• Adjusted EBITDA rose to $322 million from $288 million year-over-year, and distributable cash flow increased to $195 million from $186 million.

• Maintained a high-quality, integrated asset base with access to premium markets, supporting margin growth and risk-adjusted returns.

• Advanced ESG initiatives, reducing emissions intensity by 21% and absolute emissions by 5% from 2019 to 2023, with further reduction targets set for 2025 and 2035.

• Announced plans for a normal course issuer bid, reflecting commitment to shareholder value.

Financial highlights

• Q3 2024 revenue was $1.96 billion, up from $1.46 billion in Q3 2023.

• Net earnings for Q3 2024 were $184.6 million; distributable cash flow was $195.1 million; adjusted EBITDA reached $322.2 million.

• Net debt to adjusted EBITDA at 1.9x at Q3 2024, reflecting low leverage and strong liquidity of $1.51B.

• Dividends declared per share increased to $0.52, with a payout ratio of 61%.

• Average 5-year ROIC of 15%, with FY23 ROIC at 16%.

Outlook and guidance

• 2024 guidance: growth capex $80–$100M, maintenance capex $120–$140M, marketing realized margin $450–$480M, cash taxes $90–$100M.

• Adjusted EBITDA expected to reach high end of 6–7% CAGR target (2022–2025), holding Marketing constant.

• Dividend growth and share buybacks prioritized, with capital allocation focused on balance sheet strength and growth investments.

• 2025 guidance to be provided on December 10, 2024.