By Tess Stynes
Kinder Morgan Inc.'s (KMI) third-quarter earnings rose 43%
driven by continued strong growth at its Kinder Morgan Energy
Partners LP (KMP) affiliate while El Paso Pipeline Partners LP
(EPB) posted a modest decline.
Kinder Morgan Energy Partners, which holds the majority of
Kinder Morgan assets, reported its profit soared 70% on sharply
higher earnings at its natural-gas pipelines segment while El Paso
Pipeline Partners' earnings were down 6.6% amid higher costs.
Kinder Morgan Inc. acquired El Paso Corp. during late May of
2012 in a roughly $21 billion deal that created the largest
natural-gas pipeline operator in North America. The latest period
is the first to compare with a full quarter of El Paso Pipeline's
year-earlier results.
Kinder Morgan Energy, which transports natural gas and coal, has
benefited from strong production at U.S. alternative shale
fields.
Kinder Morgan Inc. reported a profit of $286 million, or 27
cents a share, up from $200 million, or 17 cents a share, a year
earlier. The year-earlier period included two cents a share in
losses from discontinued operations, mostly owing to fair-value
impacts. Revenue increased 27% to $3.65 billion.
Analysts polled by Thomson Reuters most recently projected
earnings of 32 cents on revenue of $3.71 billion.
Kinder Morgan Energy reported a profit of $689 million, up from
$405 million a year earlier. On a per-unit basis, which reflects
general partner interests, earnings were 59 cents, compared with a
year-earlier loss of six cents. Excluding asset-sale gains,
prior-year fair value impacts and other items, adjusted earnings
were down at 51 cents from 57 cents. Revenue increased 31% to $3.28
billion.
Analysts polled by Thomson Reuters most recently projected
earnings of 62 cents on revenue of $3.06 billion.
The natural-gas pipeline business reported adjusted segment
earnings were up 59%, mostly on dropdowns related to the El Paso
acquisition, as well as a full quarter of contributions from its
Copano Energy acquisition. Overall segment transport volumes fell
6% largely owing to lower natural gas demand for electric power
generation.
El Paso Pipeline Partners reported a profit of $141million, down
from $151 million. On a per-unit basis, which reflects the general
partner interests, earnings fell to 40 cents from 55 cents.
Excluding items, per-unit adjusted earnings were off at 58 cents
from 71 cents. Revenue edged up 0.3% to $369 million.
Analysts polled by Thomson Reuters most recently projected
earnings of 47 cents on revenue of $383 million.
Costs and expenses increased 6.1%.
Kinder Morgan Inc.'s shares closed Wednesday at $35.62, while
Kinder Morgan Energy's units closed at $80.14 and El Paso Pipeline
Partners' units closed at $41.21. The stocks weren't actively
trading after hours.
Write to Tess Stynes at tess.stynes@wsj.com
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