Kinder morgan, inc. increases quarterly dividend to $0.42 per share
Houston--(business wire)--kinder morgan, inc. (nyse: kmi) today reported first quarter cash available to pay dividends of $573 million, up 12 percent from $513 million for the same period a year ago, and remains on track to meet or exceed its published annual budget of $1.78 billion in cash available to pay dividends. the board of directors increased the quarterly cash dividend to $0.42 per share ($1.68 annualized), which is payable on may 16, 2014, to shareholders of record as of april 30, 2014. this represents an increase of 11 percent from the first quarter 2013 cash dividend per share of $0.38 ($1.52 annualized) and is up from the fourth quarter 2013 dividend of $0.41 ($1.64 annualized) per share. chairman and ceo richard d. kinder said, “kmi had an excellent first quarter led by continued strong performance at kinder morgan energy partners (nyse: kmp) and solid results at el paso pipeline partners (nyse: epb). we are excited about the future as we own and operate what we believe is a great set of midstream assets spanning the united states and western canada. we have identified approximately $16.4 billion in expansion and joint venture investments at the kinder morgan companies that we are confident will come to fruition and drive growth at kmi for years to come. we are seeing unprecedented demand for natural gas transportation capacity. since dec. 1, 2013, we have entered into approximately 2.8 billion cubic feet per day of new firm transportation commitments with customers for terms averaging about 15 years. while many of these commitments result in expansion of our existing assets and drive additional capital expenditures included in our project backlog, about a quarter of the committed volumes is for existing unsubscribed capacity, both indicative of strong demand for our existing pipeline network. in january, due in part to record cold weather in many parts of the country, kinder morgan’s natural gas pipelines transported on average about 33 billion cubic feet per day, representing approximately one-third of the u.s. market demand.” 2014 outlook as previously announced, kmi expects to declare dividends of $1.72 per share for 2014, an 8 percent increase over its 2013 declared dividend of $1.60 per share. growth in 2014 is expected to be driven by continued strong performance at kmp and contributions from epb. the growth at kmi from kmp and epb will be partially offset by the loss of income from the 2013 and expected 2014 sales (dropdowns) of certain assets to kmp and epb. subject to appropriate board approvals, kmi expects to drop down its 50 percent interest in ruby pipeline, its 50 percent interest in gulf lng and its 47.5 percent interest in young gas storage to epb during 2014. other news kmi repurchased 2.8 million shares of its common stock during the first quarter for approximately $94 million, completing the $250 million authorized by the kmi board of directors in october of 2013. subsequent to the completion of that program, the board authorized an additional $100 million share and warrant repurchase program. kmi repurchased approximately 31 million warrants during the first quarter for approximately $55 million, leaving about $45 million remaining on that authorization. kinder morgan is the largest midstream and the third largest energy company in north america with a combined enterprise value of approximately $100 billion. it owns an interest in or operates approximately 80,000 miles of pipelines and 180 terminals. its pipelines transport natural gas, gasoline, crude oil, co2 and other products, and its terminals store petroleum products and chemicals and handle such products as ethanol, coal, petroleum coke and steel. kinder morgan, inc. (nyse: kmi) owns the general partner interests of kinder morgan energy partners, l.p. (nyse: kmp) and el paso pipeline partners, l.p. (nyse: epb), along with limited partner interests in kmp, kinder morgan management, llc (nyse: kmr) and epb. for more information please visit www.kindermorgan.com. please join kinder morgan at 4:30 p.m. eastern time on wednesday, april 16 at www.kindermorgan.com for a live webcast conference call on the company’s first quarter earnings. the non-generally accepted accounting principles, or non-gaap, financial measure of cash available to pay dividends is presented in this news release. cash available to pay dividends is a significant metric used by us and by external users of our financial statements, such as investors, research analysts, commercial banks and others, to compare basic cash flows generated by us to the cash dividends we expect to pay our shareholders on an ongoing basis. management uses this metric to evaluate our overall performance. cash available to pay dividends is also an important non-gaap financial measure for our shareholders because it serves as an indicator of our success in providing a cash return on investment. this financial measure indicates to investors whether or not we are generating cash flow at a level that can sustain or support an increase in the quarterly dividends we are paying. our dividend policy provides that, subject to applicable law, we will pay quarterly cash dividends generally representing the cash we receive from our subsidiaries less any cash disbursements and reserves established by our board of directors. cash available to pay dividends is also a quantitative measure used in the investment community because the value of a share of an entity like kmi that pays out all or a substantial proportion of its cash flow is generally determined by the dividend yield (which in turn is based on the amount of cash dividends the corporation pays to its shareholders). the economic substance behind our use of cash available to pay dividends is to measure and estimate the ability of our assets to generate cash flows sufficient to pay dividends to our investors. we believe the gaap measure most directly comparable to cash available to pay dividends is income from continuing operations. a reconciliation of cash available to pay dividends to income from continuing operations is provided in this release. our non-gaap measure described above should not be considered as an alternative to gaap net income and has important limitations as an analytical tool. our computation of cash available to pay dividends may differ from similarly titled measures used by others. you should not consider this non-gaap measure in isolation or as a substitute for an analysis of our results as reported under gaap. management compensates for the limitations of this non-gaap measure by reviewing our comparable gaap measures, understanding the differences between the measures and taking this information into account in its analysis and its decision making processes. this news release includes forward-looking statements. these forward-looking statements are subject to risks and uncertainties and are based on the beliefs and assumptions of management, based on information currently available to them. although kinder morgan believes that these forward-looking statements are based on reasonable assumptions, it can give no assurance that such assumptions will materialize. important factors that could cause actual results to differ materially from those in the forward-looking statements herein include those enumerated in kinder morgan’s reports filed with the securities and exchange commission. forward-looking statements speak only as of the date they were made, and except to the extent required by law, kinder morgan undertakes no obligation to update or review any forward-looking statement because of new information, future events or other factors. because of these uncertainties, readers should not place undue reliance on these forward-looking statements. total epb distributions to us notes: kinder morgan, inc. and subsidiaries preliminary consolidated statements of income (unaudited) (in millions, except per share amounts) notes: kinder morgan, inc. and subsidiaries preliminary reconciliation of cash available to pay dividends from income from continuing operations (unaudited) (in millions) notes: long-term debt - epb notes:
