Highlights
(All financial figures are unaudited and in Canadian dollars unless otherwise noted. * identifies non-GAAP financial measures. Please refer to Non-GAAP Reconciliations Appendices.)
- First quarter GAAP earnings of
$1.4 billion or$0.67 per common share, compared with GAAP earnings of$1.7 billion or$0.86 per common share in 2023 - Adjusted earnings* of
$2.0 billion or$0.92 per common share*, an increase of 8% per share, compared with$1.7 billion or$0.85 per common share in 2023 - Adjusted earnings before interest, income taxes and depreciation and amortization (EBITDA)* of
$5.0 billion , an increase of 11%, compared with$4.5 billion in 2023 - Excluding the contributions from, and the impact of financing, the
U.S. Gas Utilities Acquisitions, Adjusted EBITDA* of$4.8 billion , an increase of 8%, compared with$4.5 billion in 2023 - Cash provided by operating activities of
$3.2 billion , compared with$3.9 billion in 2023 - Distributable cash flow (DCF)* of
$3.5 billion , an increase of 9%, compared with$3.2 billion in 2023 - Excluding the contributions from, and the impact of financing, the
U.S. Gas Utilities Acquisitions, DCF of$3.4 billion an increase of 8%, compared with$3.2 billion in 2023 - Reaffirmed 2024 full year financial guidance and reaffirmed the Company's medium-term outlook. The gas utilities acquisitions announced on
September 5, 2023 (the "Acquisitions") are not included in the 2024 financial guidance - Closed the acquisition of
The East Ohio Gas Company ("EOG"), now doing business as Enbridge Gas Ohio, from Dominion Energy Inc. onMarch 6, 2024 for a purchase price ofUS$6.6 billion (includingUS$2.3 billion of assumed debt) - Received approval of the Mainline Tolling Settlement ("MTS") from the Canada Energy Regulator ("CER") on
March 4, 2024 , after unanimous industry approval - Announced definitive agreement with
WhiteWater/I Squared Capital ("WhiteWater/I Squared") and MPLX LP ("MPLX") to form a joint venture (the "Whistler Parent JV") that will develop, construct, own, and operate natural gas pipeline and storage assets connectingPermian Basin natural gas supply to growingLiquefied Natural Gas ("LNG") and otherU.S. Gulf Coast demand - Sanctioned the previously announced Tennessee Ridgeline Expansion, a
US$1.1 billion natural gas pipeline which will deliver natural gas to theTennessee Valley Authority's recently announced gas-fired generation plant inKingston, Tennessee - Closed the previously announced sale of
Enbridge's interests in Alliance Pipeline ("Alliance") andAux Sable to Pembina Pipeline Corporation onApril 1, 2024 for proceeds of$3.1 billion - Launched a binding open season on Gray Oak Pipeline for up to 120 kbpd of expanded capacity
- Sanctioned 2.5 million barrels of additional storage at Enbridge Ingleside Energy Center ("EIEC"), for
~US$0.1 billion - Signed an agreement to acquire 2 marine docks and land from Flint Hills Resources, adjacent to the EIEC terminal for
~US$0.2 billion - Sanctioned construction of
U.S. Gulf Coast offshore pipelines to service Shell and Equinor'sSparta development for~US$0.2 billion - Issued 23rd Sustainability Report, demonstrating the Company's continued commitment to reconciliation, social governance, and environmental stewardship.
- Exited the quarter with Debt-to-EBITDA of 4.7x, in the middle of the target range of 4.5x to 5.0x;
Enbridge expects annualized EBITDA contributions from theUS$14 billion of Acquisitions in 2024 to strengthenEnbridge's Debt-to-EBITDA position throughout 2025
CEO COMMENT
"We are pleased to announce a very solid start to 2024. The continued need for safe, reliable, and affordable energy drove high utilization across our footprint. Enbridge has a long history of predictable financial and operational performance, and this quarter was no different. We are executing on our strategic priorities and are on track to achieve our full-year EBITDA and DCF per share guidance," said Greg Ebel, President and CEO of
"Strong operational performance and execution drove record financial results. During the quarter, we reached a significant milestone by closing the purchase of
"In Liquids, we saw high utilization across our systems including another quarter of strong Mainline performance. The CER approved the Mainline Tolling agreement, a true win-win-win for us, our customers, and the markets we serve. We also advanced our integrated
"In Gas Transmission, we entered into a definitive agreement to acquire a meaningful, strategic interest in the Whistler Parent JV, an integrated
"In Gas Distribution, despite significantly warmer weather in
"In Renewables, the acquisition of additional interest in German offshore wind farms, the generation of Investment Tax Credits from Fox Squirrel, and strong European wind resources drove a 100% increase in EBITDA compared to the first quarter of 2023. In
"Today, we published our 23rd annual Sustainability Report which provides an update on our performance across environmental, social, and governance issues versus the targets we set in 2020. Our safety record remains industry-leading, employee diversity is growing, and we're reducing emissions ahead of our 2030 target.
"
FINANCIAL RESULTS SUMMARY
Financial results for the three months ended
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars, except per share amounts; number of shares in millions) | ||
GAAP Earnings attributable to common shareholders | 1,419 | 1,733 |
GAAP Earnings per common share | 0.67 | 0.86 |
Cash provided by operating activities | 3,151 | 3,866 |
Adjusted EBITDA1 | 4,954 | 4,468 |
Base Business Adjusted EBITDA1,2 | 4,845 | 4,468 |
Adjusted Earnings1 | 1,955 | 1,726 |
Adjusted Earnings per common share1 | 0.92 | 0.85 |
Distributable Cash Flow1 | 3,463 | 3,180 |
Base Business Distributable Cash Flow1,2 | 3,437 | 3,180 |
Weighted average common shares outstanding | 2,126 | 2,025 |
Base Business weighted average common shares outstanding2 | 2,023 | 2,025 |
1 | Non-GAAP financial measures. Please refer to Non-GAAP Reconciliations Appendices. |
2 | Base Business results are adjusted to exclude the contributions from, and the impact of financing, the Acquisitions. These include associated EBITDA, DCF, capital expenditures, and common share and debt issuances attributable to the Acquisitions. For a full reconciliation, see Appendix D of this news release. |
GAAP earnings attributable to common shareholders for the first quarter of 2024 decreased by
The period-over-period comparability of GAAP earnings attributable to common shareholders is impacted by certain unusual, infrequent factors or other non-operating factors which are noted in the reconciliation schedule included in Appendix A of this news release. Refer to the Company's Management's Discussion & Analysis for the first quarter of 2024 filed in conjunction with the first quarter financial statements for a detailed discussion of GAAP financial results.
Adjusted EBITDA in the first quarter of 2024 increased by
Adjusted earnings in the first quarter of 2024 increased by
DCF for the first quarter of 2024 increased by
Quarterly per share metrics were impacted by the bought deal equity issuance in the third quarter of 2023, as part of the financing plan for the Acquisitions.
Detailed financial information and analysis can be found below under First Quarter 2024 Financial Results.
FINANCIAL OUTLOOK
The Company reaffirms its 2024 Base Business financial guidance for EBITDA and DCF. Results in the first quarter of 2024 are in line with the Company's expectations.
FINANCING UPDATE
Financing the Acquisitions
Since the announcement of the Acquisitions on
These financings included the issuance of 102.9 million common shares for gross proceeds of approximately
The remaining acquisition funding requirements can be readily satisfied through a variety of alternate sources, including the issuance of senior unsecured notes, hybrid subordinated notes, the Company's ongoing capital recycling program, and initiating an At-The-Market ("ATM") common share issuance program. In order for the Company to retain funding flexibility,
Once funding is complete and the Acquisitions are closed, the Company expects its key leverage ratio, Debt-to-EBITDA, to remain well within its target range of 4.5x to 5.0x after recognizing annualized EBITDA contributions from the Acquisitions.
Other Financing
On
SECURED GROWTH PROJECT EXECUTION UPDATE
Funding of the secured growth program is expected to be provided for entirely through the Company's anticipated
BUSINESS UPDATES
Liquids Pipelines: Mainline Tolling Agreement approved by Canadian Energy Regulator
On
The settlement term is seven and a half years through the end of 2028, and is retroactively effective back to
Liquids Pipelines: Permian Export Strategy
Related, in addition to sanctioning an additional 2.5 million barrels at the EIEC, for
Gas Transmission: Extending Offshore Value Chain with Shell Pipeline
On
Gas Transmission: Alliance and Aux Sable Transaction Closed
On
Gas Transmission: New Permian Basin Natural Gas Joint Venture
On
The transaction is expected to be immediately accretive to
Closing is expected in the second quarter of 2024, subject to receipt of required regulatory approvals and satisfaction of other customary closing conditions.
Gas Transmission: Tennessee Ridgeline Expansion reaches Final Investment Decision
The Tennessee Ridgeline Expansion project is an expansion of the
All necessary regulatory authorizations from the
Gas Distribution and Storage:
On
The closings of the remaining Acquisitions remain on track to occur in 2024, each being subject to the receipt of required regulatory approvals, applicable to each gas utility (neither cross-conditioned to the other).
Gas Distribution and Storage:
On
Additionally, the
An updated Draft Interim Rate Order reflecting the Phase 1 Decision was filed on
The Phase 1 Decision, pending resolution of the Motion to Review and Appeal, is immaterial to
FIRST QUARTER 2024 FINANCIAL RESULTS
GAAP Segment EBITDA and Cash Flow from Operations
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Liquids Pipelines | 2,404 | 2,353 |
Gas Transmission | 1,265 | 1,205 |
Gas Distribution and Storage | 765 | 716 |
257 | 136 | |
Eliminations and Other | (642) | 17 |
EBITDA1 | 4,049 | 4,427 |
Earnings attributable to common shareholders | 1,419 | 1,733 |
Cash provided by operating activities | 3,151 | 3,866 |
1 Non-GAAP financial measure. Please refer to Non-GAAP Reconciliations Appendices. |
For purposes of evaluating performance, the Company makes adjustments to GAAP reported earnings, segment EBITDA and cash flow provided by operating activities for unusual, infrequent or other non-operating factors, which allow Management and investors to more accurately compare the Company's performance across periods, normalizing for factors that are not indicative of underlying business performance. Tables incorporating these adjustments follow below. Schedules reconciling EBITDA, adjusted EBITDA, adjusted EBITDA by segment, adjusted earnings, adjusted earnings per share and DCF to their closest GAAP equivalent are provided in the Appendices to this news release.
Adjusted EBITDA By Segment
Adjusted EBITDA generated from U.S. dollar denominated businesses was translated to Canadian dollars at similar average exchange rates (
Liquids Pipelines
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Mainline System | 1,338 | 1,337 |
Regional Oil Sands System | 227 | 231 |
427 | 384 | |
Other Systems2 | 468 | 390 |
Adjusted EBITDA3 | 2,460 | 2,342 |
Operating Data (average deliveries – thousands of bpd) | ||
Mainline System volume4 | 3,127 | 3,120 |
Canadian International Joint Tariff5 ($C) | $— | |
$— | ||
Competitive Tolling Settlement IJT and surcharges6 ($US) | $— | |
Line 3 Replacement Surcharge ($US)6,7 |
1 | Consists of Flanagan South Pipeline, Seaway Pipeline, Gray Oak Pipeline, |
2 | Other consists of Southern Lights Pipeline, Express-Platte System, Bakken System, and others. |
3 | Non-GAAP financial measure. Please refer to Non-GAAP Reconciliations Appendices. |
4 | Mainline System throughput volume represents Mainline System deliveries ex- |
5 | Tariff tolls, per barrel, for heavy crude oil movements from |
6 | Includes the IJT benchmark toll, for heavy crude oil movements from |
7 | Effective |
Liquids Pipelines adjusted EBITDA increased
- higher contributions from the
Gulf Coast and Mid-Continent Systems due to higher volumes on Flanagan South Pipeline and higher EIEC volumes; - higher contributions from Express-Platte due primarily to greater long-haul deliveries; and
- higher contributions from Southern Lights Pipeline due primarily to the discontinuation of rate-regulated accounting in the fourth quarter of 2023.
Gas Transmission
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
949 | 925 | |
Canadian Gas Transmission | 196 | 182 |
Other | 129 | 82 |
Adjusted EBITDA1 | 1,274 | 1,189 |
1 Non-GAAP financial measure. Please refer to Non-GAAP Reconciliations Appendices. |
Gas Transmission adjusted EBITDA increased
- favorable contracting on our
U.S. Gas Transmission and storage assets; - contributions from the acquisitions of
Tres Palacios in the second quarter of 2023,Aitken Creek in the fourth quarter of 2023, and Tomorrow RNG in the first quarter of 2024; and - higher earnings in our
Aux Sable joint venture due to favorable fractionation spreads and contracting; partially offset by - the absence in 2024 of a one-time recognition of revenues attributable to the Texas Eastern rate case settlement in the first quarter of 2023.
Gas Distribution and Storage
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
697 | 699 | |
50 | — | |
Other | 18 | 17 |
Adjusted EBITDA1 | 765 | 716 |
Operating Data | ||
EGI | ||
Volumes (billions of cubic feet) | 664 | 767 |
Number of active customers2(millions) | 3.9 | 3.9 |
Heating degree days3 | ||
Actual | 1,377 | 1,728 |
Forecast based on normal weather4 | 1,627 | 1,892 |
1 | Non-GAAP financial measure. Please refer to Non-GAAP Reconciliations Appendices. |
2 | Number of active customers is the number of natural gas consuming customers at the end of the reported period. |
3 | Heating degree days is a measure of coldness that is indicative of volumetric requirements for natural gas utilized for heating purposes in EGI's distribution franchise areas. |
4 | Normal weather is the weather forecast by EGI in its legacy rate zones, using the forecasting methodologies approved by the OEB. |
Adjusted EBITDA for the first quarter increased
- partial contributions from the acquisition of EOG on
March 6, 2024 ; and - higher distribution charges at EGI resulting from increases in rates and customer base; partially offset by
- the negative impact of warmer weather than for the same period of 2023.
The negative impact of weather was approximately
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Adjusted EBITDA1 | 279 | 139 |
1 Non-GAAP financial measure. Please refer to Non-GAAP Reconciliations Appendices. |
- contributions from our investment in Fox Squirrel as a result of the generation of investment tax credits;
- higher contribution from the Hohe See and Albatros Offshore Wind Facilities as a result of the
November 2023 acquisition of an additional 24.45% interest in these facilities; and - stronger wind resources partially offset by lower energy pricing at European wind facilities.
Eliminations and Other
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Operating and administrative recoveries | 195 | 53 |
Realized foreign exchange hedge settlement (loss)/gain | (19) | 29 |
Adjusted EBITDA1 | 176 | 82 |
1 Non-GAAP financial measure. Please refer to Non-GAAP Reconciliations Appendices. |
Operating and administrative recoveries captured in this segment reflect the cost of centrally delivered services (including depreciation of corporate assets) inclusive of amounts recovered from business units for the provision of those services. U.S. dollar denominated earnings within operating segment results are translated at average foreign exchange rates during the quarter, and the impact of settlements made under the Company's enterprise foreign exchange hedging program are captured in this corporate segment.
Eliminations and Other adjusted EBITDA increased
Distributable Cash Flow
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars; number of shares in millions) | ||
Liquids Pipelines | 2,460 | 2,342 |
Gas Transmission | 1,274 | 1,189 |
Gas Distribution and Storage | 765 | 716 |
279 | 139 | |
Eliminations and Other | 176 | 82 |
Adjusted EBITDA1,3 | 4,954 | 4,468 |
Maintenance capital | (196) | (173) |
Interest expense1 | (1,014) | (926) |
Current income tax1 | (263) | (180) |
Distributions to noncontrolling interests1 | (78) | (92) |
Cash distributions in excess of equity earnings1 | 96 | 65 |
Preference share dividends1 | (93) | (84) |
Other receipts of cash not recognized in revenue2 | 28 | 83 |
Other non-cash adjustments | 29 | 19 |
DCF3 | 3,463 | 3,180 |
Weighted average common shares outstanding4 | 2,126 | 2,025 |
1 | Presented net of adjusting items. |
2 | Consists of cash received, net of revenue recognized, for contracts under make-up rights and similar deferred revenue arrangements. |
3 | Non-GAAP financial measures. Please refer to Non-GAAP Reconciliations Appendices. |
4 | Includes equity pre-funding for the Acquisitions which are expected to close in 2024. |
First quarter 2024 DCF increased
- higher cash distributions from the Hohe See and Albatross offshore wind facilities; partially offset by
- higher interest rates impacting floating-rate debt and new issuances; and
- higher
U.S. Corporate Alternative Minimum taxes.
Weighted average common shares increased due to the bought deal equity issuance in the third quarter of 2023, as part of the pre-funding for the Acquisitions.
Adjusted Earnings
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars, except per share amounts) | ||
Adjusted EBITDA1,2 | 4,954 | 4,468 |
Depreciation and amortization | (1,234) | (1,182) |
Interest expense2 | (1,013) | (915) |
Income taxes2 | (607) | (513) |
Noncontrolling interests2 | (52) | (48) |
Preference share dividends | (93) | (84) |
Adjusted earnings1 | 1,955 | 1,726 |
Adjusted earnings per common share1 | 0.92 | 0.85 |
1 Non-GAAP financial measures. Please refer to Non-GAAP Reconciliations Appendices. |
2 Presented net of adjusting items. |
Adjusted earnings increased
- higher depreciation from assets acquired or placed into service in 2023;
- higher interest expense due to higher interest rates impacting floating-rate debt and new issuances; and
- higher income tax expense driven by higher earnings.
Quarterly per share metrics were negatively impacted by the bought deal equity issuance in the third quarter of 2023, as part the pre-funding for the Acquisitions.
CONFERENCE CALL
The conference call format will include prepared remarks from the executive team followed by a question and answer session for the analyst and investor community only.
DIVIDEND DECLARATION
On
Dividend per share | |
(Canadian dollars unless otherwise stated) | |
Common Shares | |
Preference Shares, Series A | |
Preference Shares, Series B | |
Preference Shares, Series D | |
Preference Shares, Series F | |
Preference Shares, Series G1 | |
Preference Shares, Series H | |
Preference Shares, Series I2 | |
Preference Shares, Series L | |
Preference Shares, Series N | |
Preference Shares, Series P3 | |
Preference Shares, Series R | |
Preference Shares, Series 1 | |
Preference Shares, Series 3 | |
Preference Shares, Series 54 | |
Preference Shares, Series 75 | |
Preference Shares, Series 9 | |
Preference Shares, Series 11 | |
Preference Shares, Series 13 | |
Preference Shares, Series 15 | |
Preference Shares, Series 19 |
1 | The quarterly dividend per share paid on Preference Shares, Series G was decreased to |
2 | The quarterly dividend per share paid on Preference Shares, Series I was decreased to |
3 | The quarterly dividend per share paid on Preference Shares, Series P was increased to |
4 | The quarterly dividend per share paid on Preference Shares, Series 5 was increased to |
5 | The quarterly dividend per share paid on Preference Shares, Series 7 was increased to |
FORWARD-LOOKING INFORMATION
Forward-looking information, or forward-looking statements, have been included in this news release to provide information about
Although
ABOUT
At
None of the information contained in, or connected to,
FOR FURTHER INFORMATION PLEASE | ||
Toll Free: (888) 992-0997 | Toll Free: (800) 481-2804 | |
Email: media@enbridge.com | Email: investor.relations@enbridge.com |
NON-GAAP RECONCILIATIONS APPENDICES
This news release contains references to EBITDA, adjusted EBITDA, adjusted earnings, adjusted earnings per common share and DCF. Management believes the presentation of these metrics gives useful information to investors and shareholders, as they provide increased transparency and insight into the performance of the Company.
EBITDA represents earnings before interest, tax, depreciation and amortization.
Adjusted EBITDA represents EBITDA adjusted for unusual, infrequent or other non-operating factors on both a consolidated and segmented basis. Management uses EBITDA and adjusted EBITDA to set targets and to assess the performance of the Company and its business units.
Adjusted earnings represent earnings attributable to common shareholders adjusted for unusual, infrequent or other non-operating factors included in adjusted EBITDA, as well as adjustments for unusual, infrequent or other non-operating factors in respect of depreciation and amortization expense, interest expense, income taxes and noncontrolling interests on a consolidated basis. Management uses adjusted earnings as another measure of the Company's ability to generate earnings.
DCF is defined as cash flow provided by operating activities before the impact of changes in operating assets and liabilities (including changes in environmental liabilities) less distributions to noncontrolling interests, preference share dividends and maintenance capital expenditures and further adjusted for unusual, infrequent or other non-operating factors. Management also uses DCF to assess the performance of the Company and to set its dividend payout target.
Base Business Adjusted EBITDA represents adjusted EBITDA, as further adjusted to exclude contributions from, and the impact of financing of, the acquisitions of three natural gas utilities from Dominion Energy, Inc. (the "Gas Utility Acquisitions") (including the associated EBITDA, DCF, capital expenditures, and common share and debt issuances). Management is using Base Business Adjusted EBITDA in 2024 to assess the performance of the Company and its business units excluding the impact of the Gas Utility Acquisitions, which are expected to close in 2024.
Base Business DCF represents adjusted DCF, as further adjusted to exclude contributions from, and the impact of financing of, the Gas Utility Acquisitions (including the associated EBITDA, DCF, capital expenditures, and common share and debt issuances). Management is using Base Business DCF in 2024 to assess the performance of the Company and its dividend payout target, excluding the impact of the Gas Utility Acquisitions.
This news release also contains references to Debt-to-EBITDA, a non-GAAP ratio which utilizes adjusted EBITDA as one of its components. Debt-to-EBITDA is used as a liquidity measure to indicate the amount of adjusted earnings to pay debt, as calculated on the basis of generally accepted accounting principles in
Reconciliations of forward-looking non-GAAP financial measures and non-GAAP ratios to comparable GAAP measures are not available due to the challenges and impracticability of estimating certain items, particularly certain contingent liabilities and non-cash unrealized derivative fair value losses and gains subject to market variability. Because of those challenges, a reconciliation of forward-looking non-GAAP financial measures and non-GAAP ratios is not available without unreasonable effort.
Our non-GAAP financial measures and non-GAAP ratios described above are not measures that have standardized meaning prescribed by
The tables below provide a reconciliation of the non-GAAP measures to comparable GAAP measures.
APPENDIX A
NON-GAAP RECONCILIATIONS – ADJUSTED EBITDA AND ADJUSTED EARNINGS
CONSOLIDATED EARNINGS
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Liquids Pipelines | 2,404 | 2,353 |
Gas Transmission | 1,265 | 1,205 |
Gas Distribution and Storage | 765 | 716 |
257 | 136 | |
Eliminations and Other | (642) | 17 |
EBITDA | 4,049 | 4,427 |
Depreciation and amortization | (1,193) | (1,146) |
Interest expense | (905) | (905) |
Income tax expense | (386) | (510) |
Earnings attributable to noncontrolling interests | (53) | (49) |
Preference share dividends | (93) | (84) |
Earnings attributable to common shareholders | 1,419 | 1,733 |
ADJUSTED EBITDA TO ADJUSTED EARNINGS
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars, except per share amounts) | ||
Liquids Pipelines | 2,460 | 2,342 |
Gas Transmission | 1,274 | 1,189 |
Gas Distribution and Storage | 765 | 716 |
279 | 139 | |
Eliminations and Other | 176 | 82 |
Adjusted EBITDA | 4,954 | 4,468 |
Depreciation and amortization | (1,234) | (1,182) |
Interest expense | (1,013) | (915) |
Income tax expense | (607) | (513) |
Earnings attributable to noncontrolling interests | (52) | (48) |
Preference share dividends | (93) | (84) |
Adjusted earnings | 1,955 | 1,726 |
Adjusted earnings per common share | 0.92 | 0.85 |
EBITDA TO ADJUSTED EARNINGS
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars, except per share amounts) | ||
EBITDA | 4,049 | 4,427 |
Adjusting items: | ||
Change in unrealized derivative fair value (gain)/loss | 785 | (540) |
Employee severance costs | 105 | — |
Competitive Toll Settlement realized hedge loss | — | 638 |
Litigation settlement gain | — | (68) |
Other | 15 | 11 |
Total adjusting items | 905 | 41 |
Adjusted EBITDA | 4,954 | 4,468 |
Depreciation and amortization | (1,193) | (1,146) |
Interest expense | (905) | (905) |
Income tax expense | (386) | (510) |
Earnings attributable to noncontrolling interests | (53) | (49) |
Preference share dividends | (93) | (84) |
Adjusting items in respect of: | ||
Depreciation and amortization | (41) | (36) |
Interest expense | (108) | (10) |
Income tax expense | (221) | (3) |
Earnings attributable to noncontrolling interests | 1 | 1 |
Adjusted earnings | 1,955 | 1,726 |
Adjusted earnings per common share | 0.92 | 0.85 |
APPENDIX B
NON-GAAP RECONCILIATION – ADJUSTED EBITDA TO SEGMENTED EBITDA
LIQUIDS PIPELINES
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Adjusted EBITDA | 2,460 | 2,342 |
Change in unrealized derivative fair value gain/(loss) | (35) | 615 |
CTS realized hedge loss | — | (638) |
Litigation settlement gain | — | 68 |
Other | (21) | (34) |
Total adjustments | (56) | 11 |
EBITDA | 2,404 | 2,353 |
GAS TRANSMISSION
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Adjusted EBITDA | 1,274 | 1,189 |
Change in unrealized derivative fair value gain/(loss) - Commodity prices | (17) | — |
Other | 8 | 16 |
Total adjustments | (9) | 16 |
EBITDA | 1,265 | 1,205 |
GAS DISTRIBUTION AND STORAGE
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Adjusted EBITDA | 765 | 716 |
Total adjustments | — | — |
EBITDA | 765 | 716 |
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Adjusted EBITDA | 279 | 139 |
Change in unrealized derivative fair value gain/(loss) - Foreign exchange | 2 | 2 |
Change in unrealized derivative fair value gain/(loss) - Commodity prices | (13) | — |
Other | (11) | (5) |
Total adjustments | (22) | (3) |
EBITDA | 257 | 136 |
ELIMINATIONS AND OTHER
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Adjusted EBITDA | 176 | 82 |
Change in unrealized derivative fair value gain/(loss) - Foreign exchange | (722) | (83) |
Employee severance costs | (105) | — |
Other | 9 | 18 |
Total adjustments | (818) | (65) |
EBITDA | (642) | 17 |
APPENDIX C
NON-GAAP RECONCILIATION – CASH PROVIDED BY OPERATING ACTIVITIES TO DCF
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Cash provided by operating activities | 3,151 | 3,866 |
Adjusted for changes in operating assets and liabilities1 | 300 | (914) |
3,451 | 2,952 | |
Distributions to noncontrolling interests | (78) | (92) |
Preference share dividends | (93) | (84) |
Maintenance capital2 | (196) | (173) |
Significant adjusting items: | ||
Other receipts of cash not recognized in revenue3 | 28 | 83 |
Employee severance costs, net of tax | 91 | — |
Distributions from equity investments in excess of cumulative earnings4 | 279 | 155 |
CTS realized hedge loss, net of tax | — | 479 |
Litigation settlement gain | — | (68) |
Other items | (19) | (72) |
DCF | 3,463 | 3,180 |
1 | Changes in operating assets and liabilities, net of recoveries. |
2 | Maintenance capital includes expenditures that are required for the ongoing support and maintenance of the existing pipeline system or that are necessary to maintain the service capability of the existing assets (including the replacement of components that are worn, obsolete or completing their useful lives). For the purpose of DCF, maintenance capital excludes expenditures that extend asset useful lives, increase capacities from existing levels or reduce costs to enhance revenues or provide enhancements to the service capability of the existing assets. Maintenance capital also excludes emissions reduction projects and large-scale asset modernization programs that facilitate high operational reliability. |
3 | Consists of cash received, net of revenue recognized, for contracts under make-up rights and similar deferred revenue arrangements. |
4 | Presented net of adjusting items. |
APPENDIX D
NON-GAAP RECONCILIATION – BASE BUSINESS EBITDA AND DISTRIBUTABLE CASH FLOW
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Adjusted EBITDA | 4,954 | 4,468 |
(50) | — | |
E&O EBITDA1 | (59) | — |
Base Business Adjusted EBITDA | 4,845 | 4,468 |
1 Related to investment income from the pre-funding of the Acquisitions. |
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars | ||
EBITDA | 4,049 | 4,427 |
Adjusting items: | ||
Change in unrealized derivative fair value (gain)/loss | 785 | (540) |
Employee severance costs | 105 | — |
Competitive Toll Settlement realized hedge loss | — | 638 |
Litigation settlement gain | — | (68) |
Other | 15 | 11 |
(50) | — | |
E&O EBITDA1 | (59) | — |
Base Business Adjusted EBITDA | 4,845 | 4,468 |
1 Related to investment income from the pre-funding of the Acquisitions. |
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars | ||
DCF | 3,463 | 3,180 |
Adjustments from operating and financing | ||
EBITDA | (109) | — |
Maintenance capital | 15 | — |
Financing costs | 62 | — |
Current income tax | 6 | — |
Base Business DCF | 3,437 | 3,180 |
Three months ended | ||
2024 | 2023 | |
(unaudited; millions of Canadian dollars) | ||
Cash provided by operating activities | 3,151 | 3,866 |
Adjusted for changes in operating assets and liabilities | 300 | (914) |
3,451 | 2,952 | |
Distributions to noncontrolling interests | (78) | (92) |
Preference share dividends | (93) | (84) |
Maintenance capital | (196) | (173) |
Significant adjusting items: | ||
Other receipts of cash not recognized in revenue | 28 | 83 |
Employee severance costs, net of tax | 91 | — |
Distributions from equity investments in excess of cumulative earnings | 279 | 155 |
CTS realized hedge loss, net of tax | — | 479 |
Litigation settlement gain | — | (68) |
Other items | (19) | (72) |
Adjustments from operating and financing | (26) | — |
Base Business DCF | 3,437 | 3,180 |
Three months ended | ||
2024 | 2023 | |
Weighted average common shares outstanding | 2,126 | 2,025 |
Shares issued to finance | (103) | — |
Base Business weighted average common shares outstanding | 2,023 | 2,025 |
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