CALGARY, Alberta, March 04, 2019 (GLOBE NEWSWIRE) — Gibson Energy Inc. (“Gibson” or the “Company”), (TSX: GEI), announced today its operating and financial results for the three months and fiscal year ended December 31, 2018.
“We are very pleased with the record financial and operational results Gibson delivered in 2018, as well as the steps we took to deliver on our strategy, including the sanctioning of projects to reach our growth targets through 2020,” said Steve Spaulding, President and Chief Executive Officer. “With stable cash flows from Infrastructure that continue to grow as projects are placed into service and a favorable market environment driving robust earnings from Wholesale, both our payout ratio and leverage were below our target ranges. We intend to maintain this momentum through 2019.”
- Infrastructure segment profit of $72 million in the fourth quarter contributed to 2018 full year performance of $283 million, a $48 million or 20% increase over full year 2017, with the increase primarily due to additional tankage entering service
- Wholesale segment profit of $81 million in the fourth quarter contributed to 2018 full year performance of $211 million, a $180 million increase over full year 2017, driven by improved sales prices and discounted feedstocks driving strong margins at the Moose Jaw Facility and in Crude Wholesale
- Adjusted EBITDA from continuing operations(1) of $134 million in the fourth quarter contributed to 2018 full year performance of $457 million, a $228 million increase over full year 2017
- Distributable cash flow from combined operations(2) of $84 million in the fourth quarter contributed to 2018 full year performance of $283 million, a $102 million increase over full year 2017, resulting in a payout ratio in 2018 of 67%, below the Company’s 70% to 80% target range, and compared to a payout ratio of 104% in 2017
Strategic Developments and Highlights:
- Secured infrastructure growth capital in 2018 and 2019 totaling approximately $500 million, above the top end of the Company’s growth capital target range and providing line of sight to exceeding the Company’s distributable cash flow per share growth target of 10% through to 2020
- Sanctioned the construction of four new tanks (2 million barrels) under long-term take-or-pay agreements at its Hardisty Terminal
- Secured further growth through the Viking Pipeline Project, the acceleration of the U.S. strategy and the expansion of the Moose Jaw Facility
- Advanced the divestiture of its non-core businesses, with the sales of U.S. Environmental Services business closing on May 3, 2018, Wholesale Propane closing on December 3, 2018 and non-Core Environmental Services North closing February 28, 2019, for proceeds of approximately $225 million. The disposition of Canadian Truck Transportation continues to progress, with aggregate proceeds expected to be around the midpoint of the Company’s target range
- Strengthened the balance sheet and remain fully funded for all sanctioned capital through a combination of disposition proceeds and retained distributable cash flow from combined operations, with Net Debt to Pro Forma Adjusted EBITDA at the of 2018 of 2.3x, below the Company’s 3.0x – 3.5x target range
(1) Adjusted EBITDA from continuing operations is defined in Gibson’s Management’s Discussion and Analysis (“MD&A”). See MD&A section “Results of Continuing Operations” for segment profit from continuing operations discussion, which is the most closely related GAAP measure and disclosed in note 1 of the consolidated financial statements.
(2) Distributable cash flow from combined operations is defined in Gibson’s MD&A. See MD&A sections “Liquidity and Capital Resources” and “Results of Discontinued Operations” for cash flow from operations discussion, which is the most closely related GAAP measure.
Management’s Discussion and Analysis and Financial Statements
The 2018 fourth quarter and year-end Management’s Discussion and Analysis and audited Consolidated Financial Statements provide a detailed explanation of Gibson’s operating results for the three months and fiscal year ended December 31, 2018, as compared to the three months and fiscal year ended December 31, 2017. These documents are available at www.gibsonenergy.com and at www.sedar.com.
2018 Fourth Quarter and Year-End Results Conference Call
A conference call and webcast will be held to discuss the 2018 fourth quarter and year-end financial and operating results at 7:00am Mountain Time (9:00am Eastern Time) on Tuesday, March 5, 2019.
The conference call dial-in numbers are:
- 478-219-0003 / 844-358-6759
- Participant Pass Code: 5241939
This call will also be broadcast live on the Internet and may be accessed directly at the following URL:
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 March 12, 2019, using the following dial-in numbers:
- 404-537-3406 / 855-859-2056
- Participant Pass Code: 5241939
Gibson has also made available certain supplementary information regarding the third quarter operational and financial results, available at www.gibsonenergy.com
Investor Day Webcast Details
Gibson is hosting an Investor Day on the morning of April 2, 2019 in Toronto, during which members of the senior executive team will provide a discussion of the Company’s strategy, its operations, recent developments and future opportunities.
The Investor Day will be webcast beginning at 8:45am Eastern Time (6:45am Mountain Time) and will be available through Gibson’s website www.gibsonenergy.com or may be accessed directly at the following URL: