All financial figures are in Canadian dollars unless otherwise
noted
Calgary,
AB, May 1, 2023 /CNW/ - Gibson Energy Inc.
announced today its financial and operating results for the three
months ended March 31, 2023.
"Gibson is off to a great start in 2023, with Adjusted EBITDA in
the quarter reaching a new high-water mark, driven by consistent
results from the Infrastructure segment and a Marketing
contribution well above our initial outlook," said Steve Spaulding, President and Chief Executive
Officer. "This solid business performance has further
improved our leading financial position to a payout ratio of 56%
and leverage of 2.4x, both below our target ranges, and enables us
to increase our share repurchase target for the second quarter to
$50 million resulting in a potential
full year repurchase of up to $125
million. Importantly, since the start of the year, we
have continued to progress discussions with customers to underpin
the sanction of incremental infrastructure projects and have
increasing line of sight to exceeding the high end of our
$100 million to $125 million growth capital target for the
year."
Financial Highlights:
- Revenue of $2,366 million in the
first quarter, a $322 million or 12%
decrease over the first quarter of 2022, primarily a result of
lower commodity prices decreasing contribution from the Marketing
segment
- Infrastructure Adjusted EBITDA(1) of $108 million in the first quarter, a $1 million or 1% decrease from the first quarter
of 2022, with an increase in contribution at the DRU offset by a
decrease from Pipelines
- Marketing Adjusted EBITDA(1) of $59 million in the first quarter, a $38 million or 185% increase from the first
quarter of 2022, primarily due to a much stronger contribution from
both Refined Products and Crude Marketing
- Adjusted EBITDA(1) on a consolidated basis of
$155 million in the first quarter, a
$34 million or 28% increase over the
first quarter of 2022, as result of the factors described
above
- Net Income of $88 million in the
first quarter, a $36 million or 70%
increase over the first quarter of 2022, due to the factors
described above and lower depreciation partially offset by higher
income tax expense and interest expense
- Distributable Cash Flow(1) of $107 million in the first quarter, a $28 million or 36% increase from the first
quarter of 2022, a result of the factors described above
- Dividend Payout ratio(2) on a trailing twelve-month
basis of 56%, below the Company's 70% – 80% target range
- Net Debt to Adjusted EBITDA ratio(2) at March 31, 2023 of 2.4x, below the bottom end of
the Company's 3.0x – 3.5x target range
Strategic Developments and
Highlights:
- Repurchased 1.1 million shares for an aggregate $27 million in the first quarter plus an
additional 0.7 million shares subsequent to the end of the quarter,
for a total to date this year of 1.8 million shares for an
aggregate $42 million representing
1.3% of outstanding shares
- Announced continued progress in its sustainability journey,
achieving top quartile safety performance in 2022 among North
American peers highlighted by Lost Time Injury Frequency and
Recordable Vehicle Incident Frequent rates of zero for both
employees and contractors for the third year in a row, with a Total
Recordable Injury Frequency rate of 0.46 for employees that places
Gibson in the top quartile within its peer group for the second
year in a row
- Announced that Gibson's Board of Directors approved a quarterly
dividend of $0.39 per common share,
an increase of $0.02 per common share
or 5%, beginning with the dividend payable in April
- Renewed the Company's $750
million sustainability-linked revolving credit facility,
extending its maturity into 2028
(1)
|
Adjusted EBITDA and
Distributable Cash Flow are non-GAAP financial measures. See the
"Specified Financial Measures" section of this release.
|
(2)
|
Net debt to Adjusted
EBITDA ratio and Dividend Payout ratio are non-GAAP financial
ratios. See the "Specified Financial Measures" section of this
release.
|
|
|
Management's Discussion and
Analysis and Financial Statements
The 2023 first quarter Management's Discussion and Analysis and
unaudited Condensed Consolidated Financial Statements provide a
detailed explanation of Gibson's financial and operating results
for the three months ended March 31,
2023, as compared to the three months ended March 31, 2022. These documents are
available at www.gibsonenergy.com and at www.sedar.com.
Earnings Conference Call &
Webcast Details
A conference call and webcast will be held to discuss the 2023
first quarter and operating results at 7:00am Mountain Time (9:00am Eastern Time) on Tuesday, May 2, 2023.
The conference call dial-in numbers are:
- 416-764-8659 / 1-888-664-6392
This call will also be broadcast live on the Internet and may be
accessed directly at the following URL:
- https://app.webinar.net/K8Rlzx3PeYj
The webcast will remain accessible for a 12-month period at the
above URL. Additionally, a digital recording will be available for
replay two hours after the call's completion until May 16, 2023, using the following dial-in
numbers:
- 416-764-8677 / 1-888-390-0541
- Replay Entry Code: 101920
Annual General Meeting &
Webcast Details
Gibson is holding its Annual Meeting of Shareholders on
Tuesday, May 2, 2023 at 10:00am Mountain Time (12:00 noon Eastern Time). This meeting will be held in
a hybrid format (virtual and in-person). Applying technology to the
meeting by allowing virtual participation will make the meeting
more relevant, accessible and engaging for all involved, permitting
a broader base of shareholders to participate in the meeting,
regardless of their geographic location. The optional virtual
format for the meeting will also help mitigate health and safety
risks.
Following the conclusion of the formal proceedings of the annual
shareholder meeting, Mr. Steve
Spaulding, President and Chief Executive Officer, will
address shareholders and provide brief remarks on the current state
of the business and discuss the highlights of the Company's key
initiatives.
Attending In-Person:
- Lumi Experience Studio
- Suite 1410, 225 6 Ave SW, Calgary, Alberta
Attending virtually can be accessed using the following
URL:
- https://web.lumiagm.com/#/431480231
- Password: gibson2023
The webcast will remain accessible for a 12-month period at the
above URL.
Additionally, information and materials related to the annual
general meeting of shareholders can be accessed using the following
URL:
-
https://www.gibsonenergy.com/investor-centre/shareholder-information/2023-annual-meeting-of-shareholders/
Supplementary
Information
Gibson has also made available certain supplementary information
regarding the 2023 first quarter financial and operating results,
available at www.gibsonenergy.com.
About Gibson
Gibson Energy Inc. ("Gibson" or the "Company") (TSX:
GEI), is a Canadian-based liquids infrastructure company with
its principal businesses consisting of the storage, optimization,
processing, and gathering of liquids and refined products.
Headquartered in Calgary, Alberta,
the Company's operations are focused around its core terminal
assets located at Hardisty and
Edmonton, Alberta, and include the
Moose Jaw Facility and an infrastructure position in the U.S.
Gibson shares trade under the symbol GEI and are listed on the
Toronto Stock Exchange. For more information, visit
www.gibsonenergy.com.
Forward-Looking
Statements
Certain statements contained in this press release constitute
forward-looking information and statements (collectively,
forward-looking statements) including, but not limited to,
statements concerning Gibson's dividend payment, share repurchase
and growth capital targets and sanction of incremental
infrastructure projects and continued progress in Gibson's
sustainability journey. All statements other than statements
of historical fact are forward-looking statements. The use of
any of the words ''anticipate'', ''plan'', ''contemplate'',
''continue'', ''estimate'', ''expect'', ''intend'', ''propose'',
''might'', ''may'', ''will'', ''shall'', ''project'', ''should'',
''could'', ''would'', ''believe'', ''predict'', ''forecast'',
''pursue'', ''potential'' and ''capable'' and similar expressions
are intended to identify forward looking statements.
The forward-looking statements reflect Gibson's beliefs and
assumptions with respect to, among other things, dividend
payment, ability to meet share repurchase and growth capital
targets and ability to sanction incremental infrastructure
projects. These statements involve known and unknown risks,
uncertainties and other factors that may cause actual results or
events to differ materially from those anticipated in such
forward-looking statements. No assurance can be given that these
expectations will prove to be correct and such forward-looking
statements included in this press release should not be unduly
relied upon. These statements speak only as of the date of
this press release. The Company does not undertake any obligations
to publicly update or revise any forward-looking statements except
as required by securities law. Actual results could differ
materially from those anticipated in these forward-looking
statements as a result of numerous risks and uncertainties
including, but not limited to, the risks and uncertainties
described in "Forward-Looking Information" and "Risk Factors"
included in the Company's Annual Information Form and
Management's Discussion and Analysis, each dated February 21, 2023, as filed on SEDAR and
available on the Gibson website at www.gibsonenergy.com.
For further information, please contact:
Mark Chyc-Cies
Vice President, Strategy, Planning & Investor Relations
Phone: (403) 776-3146
Email: mark.chyc-cies@gibsonenergy.com
Specified Financial
Measures
This press release refers to certain financial measures that
are not determined in accordance with GAAP, including non-GAAP
financial measures and non-GAAP financial ratios. Readers are
cautioned that non-GAAP financial measures and non-GAAP financial
ratios do not have standardized meanings prescribed by GAAP and,
therefore, may not be comparable to similar measures presented by
other entities. Management considers these to be important
supplemental measures of the Company's performance and believes
these measures are frequently used by securities analysts,
investors and other interested parties in the evaluation of
companies in industries with similar capital structures.
For further details on these specified financial measures,
including relevant reconciliations, see the
"Specified Financial Measures" section of the Company's MD&A
for the three months ended March 31,
2023 and 2022, which is incorporated by reference herein and
is available on Gibson's SEDAR profile at www.sedar.com and
Gibson's website at www.gibsonenergy.com.
a) Adjusted EBITDA
Noted below is the reconciliation to the most directly
comparable GAAP measures of the Company's segmented and
consolidated adjusted EBITDA for the three months ended
March 31, 2023, and 2022:
Three months ended
March 31
|
Infrastructure
|
Marketing
|
Corporate and
Adjustments
|
Total
|
($
thousands)
|
2023
|
2022
|
2023
|
2022
|
2023
|
2022
|
2023
|
2022
|
Segment
Profit
|
106,571
|
106,977
|
71,831
|
30,648
|
-
|
-
|
178,402
|
137,625
|
Unrealized gain on
derivative financial instruments
|
-
|
-
|
(13,081)
|
(10,040)
|
-
|
-
|
(13,081)
|
(10,040)
|
General and
administrative
|
-
|
-
|
-
|
-
|
(11,917)
|
(8,936)
|
(11,917)
|
(8,936)
|
Adjustments to share of
profit from equity accounted investees
|
1,435
|
2,011
|
-
|
-
|
-
|
-
|
1,435
|
2,011
|
Adjusted
EBITDA
|
108,006
|
108,988
|
58,750
|
20,608
|
(11,917)
|
(8,936)
|
154,839
|
120,660
|
|
|
|
|
|
Three Months ended
March 31,
|
($
thousands)
|
2023
|
2022
|
Net Income
|
88,251
|
51,970
|
|
|
|
Income tax
expense
|
27,047
|
16,002
|
Depreciation,
amortization, and impairment charges
|
28,155
|
38,439
|
Net finance
costs
|
18,419
|
14,921
|
Unrealized gain on
derivative financial instruments
|
(13,081)
|
(10,040)
|
Stock based
compensation
|
4,146
|
6,155
|
Adjustments to share of
profit from equity accounted investees
|
1,435
|
2,011
|
Corporate foreign
exchange loss
|
467
|
1,202
|
Adjusted
EBITDA
|
154,839
|
120,660
|
|
|
|
b) Distributable Cash Flow
The following is a reconciliation of distributable cash flow
from operations to its most directly comparable GAAP measure, cash
flow from operating activities:
|
Three months ended
March 31,
|
($
thousands)
|
2023
|
2022
|
Cash flow from
operating activities
|
159,527
|
305,736
|
Adjustments:
|
|
|
Changes in non-cash
working capital and taxes paid
|
(4,879)
|
(190,653)
|
Replacement
capital
|
(5,335)
|
(2,168)
|
Cash interest expense,
including capitalized interest
|
(16,799)
|
(13,619)
|
Lease
payments
|
(9,572)
|
(10,596)
|
Current income
tax
|
(15,541)
|
(9,581)
|
Distributable cash
flow
|
107,401
|
79,119
|
|
|
|
|
|
|
|
Twelve months ended
March 31,
|
($
thousands)
|
2023
|
Cash flow from
operating activities
|
452,103
|
Adjustments:
|
|
Changes in non-cash
working capital and taxes paid
|
104,198
|
Replacement
capital
|
(25,408)
|
Cash interest expense,
including capitalized interest
|
(62,996)
|
Lease
payments
|
(34,373)
|
Current income
tax
|
(49,034)
|
Distributable cash
flow
|
384,490
|
|
|
c) Dividend Payout Ratio
Twelve months ended
March 31,
|
|
2023
|
2022
|
Distributable cash
flow
|
384,490
|
306,439
|
Dividends
declared
|
216,452
|
208,463
|
Dividend payout
ratio
|
56 %
|
68 %
|
|
|
|
d) Net Debt To Adjusted EBITDA
Ratio
|
Twelve months ended
March 31,
|
|
2023
|
2022
|
|
|
|
Long-term
debt
|
1,577,069
|
1,480,033
|
Lease
liabilities
|
67,910
|
73,437
|
Less: unsecured hybrid
debt
|
(250,000)
|
(250,000)
|
Less: cash and cash
equivalents
|
(40,586)
|
(54,129)
|
|
|
|
Net debt
|
1,354,393
|
1,249,341
|
Adjusted
EBITDA
|
555,158
|
462,816
|
Net debt to adjusted
EBITDA ratio
|
2.4
|
2.7
|
|
|
|
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SOURCE Gibson Energy Inc.