KINDER MORGAN, INC. Q1 FY2025 earnings call

• Rich Kinder discussed drivers of natural gas demand growth, noting 80% increase from 2005 to 2024 and projections for 20-28 Bcf/day growth by 2030, led by LNG export demand.
• Added ~$900 million to backlog in Q1 2025, totaling $8.8 billion. Over 70% focused on serving power demand, including $430 million Elba Express pipeline extension.
• Tariffs expected to have ~1% impact on new large projects, mitigated by preordering equipment, negotiating caps, and securing domestic steel.
• Closed $640 million acquisition of Bakken gathering and processing system, performing in line with expectations.
• Declared $0.2925 per share dividend, annualized $1.17, 2% increase from last year.
• Net debt $32.8 billion, net debt to adjusted EBITDA 4.1 times, in target range. Expect to exceed budget by Outrigger acquisition contribution.

Natural Gas Business Unit

• Transport volumes up 3% in Q1 2025 vs Q1 2024; new peak day volume records set on four of five largest pipeline systems. Gathering volumes down 6% in Q1 2025 vs Q1 2024, driven by lower Haynesville production. Full-year 2025 gathering volumes expected to average 5% above 2024 but 2% below budget.

Product Pipeline Segment

• Refined products volumes up 2%, crude and condensate volumes up 4% in Q1 2025 vs Q1 2024. Full-year 2025 refined product volumes forecasted to be up ~2% vs 2024, flat with budget.

Terminals Business Segment

• Liquids lease capacity high at 94%. Refining cracks and blending margins softened but remain supportive of strong rates and utilization at key hubs. Jones Act tanker fleet fully leased, 97% leased through 2025, 94% through 2026.

CO2 Segment

• Slightly lower oil production volumes (~1%), 5% higher NGL volumes, 7% lower CO2 volumes in Q1 2025 vs Q1 2024. Full-year 2025 oil volumes forecasted to be 1% below 2024, 2% above budget

• Full-year 2025 expected to exceed budget by Outrigger acquisition contribution. Adjusted EBITDA growth 4%, with Outrigger acquisition increasing to 5%. Adjusted EPS growth 10%, net debt to adjusted EBITDA 3.8 times by year-end.
• Vast majority of expansion projects on track to be placed in service on time and on budget.

• Uncertainty around tariffs and commodity prices causing conservative outlook.
• Potential impact of trade tariffs on US LNG demand and project economics, though currently estimated at ~1% of project costs.

Q: Potential additional gas pipeline investments with utilities and data centers.

A: Sital Mody and Kimberly Allen Dang discussed strong activity level, 70% of Q1 backlog related to power, 50% of total backlog related to power, with active pursuit of data center opportunities in Southern US.

Q: Progress in Arizona regarding EPNG expansion.

A: Sital Mody mentioned interest and need in Arizona, pursuing brownfield and greenfield opportunities, but no specific progress to announce yet.

Q: Recessionary demand signs.

A: Kimberly Allen Dang stated refined product volumes up 2%, strong natural gas demand driven by LNG export and storage refill needs, not seeing early recessionary signs in natural gas demand.

Q: Bridge project and backlog additions.

A: Tom Martin discussed South Carolina's growth potential, Bridge project establishing platform, with potential for future expansions based on customer demand.

Q: Permitting relief and project timing.

A: Kimberly Allen Dang mentioned positive conversations with administration, filing with FERC to accelerate permits by up to 5 months, working to get projects in service early.