CALGARY, Alberta, Feb. 16, 2024 (GLOBE NEWSWIRE) — TC Energy Corporation ((TSX, NYSE:TRP) (TC Energy or the Company) released its fourth quarter results today. François Poirier, TC Energy’s President and Chief Executive Officer commented, “By remaining focused on a clearly defined set of priorities emphasizing project execution, safety and operational excellence, we delivered record operational performance and financial results. 2023 marks one of the most transformational years for TC Energy – we reached mechanical completion on the Coastal GasLink pipeline project, announced our intention to spin off the Liquids Pipelines business and enhanced our financial strength through our asset divestiture program. Underpinned by our strong performance, TC Energy’s Board of Directors approved a dividend increase of 3.2 per cent for the quarter ending March 31, 2024, equivalent to $3.84 per common share on an annualized basis. This represents our twenty-fourth consecutive year of dividend growth.” Poirier continued, “As we look to 2024, our strategic priorities remain in pursuit of maximizing the value of our assets, safely executing our major projects on time and budget and further enhancing our balance sheet strength and flexibility.”
Highlights
(All financial figures are unaudited and in Canadian dollars unless otherwise noted)
Fourth quarter 2023 financial results:
Delivered approximately 16 per cent growth in comparable EBITDA1 of $3.1 billion compared to $2.7 billion in fourth quarter 2022 and segmented earnings of $2.3 billion compared to segmented losses of $1.0 billion in fourth quarter 2022
Comparable earnings per common share1 of $1.35 in fourth quarter 2023 increased 22 per cent compared to $1.11 in fourth quarter 2022 and net income per common share of $1.41 in fourth quarter 2023 compared to net loss per common share of $1.42 in fourth quarter 2022
Year ended December 31, 2023 financial results:
Delivered approximately 11 per cent growth in 2023 comparable EBITDA of $11.0 billion compared to $9.9 billion in 2022 and segmented earnings of $6.1 billion compared to $3.6 billion in 2022
Five per cent increase in comparable earnings per common share of $4.52 in 2023 compared to $4.30 in 2022 and net income per common share of $2.75 in 2023 compared to $0.64 in 2022
Strong fourth quarter 2023 results were underpinned by the continued reliability, availability and exceptional operational performance of our assets. While our Natural Gas Pipelines business is not exposed to material volumetric or commodity price risks, strong utilization rates demonstrate the demand for our services and the longer-term criticality of our assets
Total NGTL System deliveries averaged 14.5 Bcf/d, largely consistent relative to fourth quarter 2022
U.S. Natural Gas Pipelines deliveries to power generators continued to grow, setting a record of 2.8 Bcf/d during fourth quarter 2023, up 16 per cent relative to fourth quarter 2022
U.S. Natural Gas Pipelines daily average flows were 27.7 Bcf/d, in line with fourth quarter 2022
Gas Transmission Northwest (GTN) system achieved an all-time delivery record of 3.1 Bcf on November 11, 2023
The Keystone Pipeline System achieved approximately 92 per cent operational reliability during fourth quarter 2023
Continued strong demand across the Keystone Pipeline System
Bruce Power achieved approximately 85 per cent availability in fourth quarter 2023 reflecting a planned outage on Unit 8, and approximately 92 per cent overall availability in 2023, with Unit 6 returning to service in September 2023 ahead of schedule and within budget
Alberta cogeneration power plant fleet achieved 98.7 per cent availability
Following mechanical completion, required pipeline commissioning activities were completed on the Coastal GasLink project and the pipeline was ready to deliver natural gas to the LNG Canada facility in fourth quarter 2023. These milestones entitle Coastal GasLink LP to receive a $200 million incentive payment from LNG Canada. In accordance with the contractual terms between the Coastal GasLink LP partners, this amount accrues in full to TC Energy as the project developer, was recorded in fourth quarter 2023 and was settled through a cash distribution on February 12, 2024
Excluding earnings from Coastal GasLink related to the recognition of the $200 million incentive payment, TC Energy delivered approximately nine per cent growth in comparable EBITDA in 2023 compared to 2022
Reaffirming 2024 outlook:
Comparable EBITDA outlook for 2024 is expected to be $11.2 to $11.5 billion and remains consistent with our November 2023 Investor Day, with growth related to increased comparable EBITDA from the NGTL System due to the advancement of expansion programs, the full-year impact of projects placed into service in 2023, including Bruce Power Unit 6 which returned to service in September, along with new projects anticipated to be placed in service in 2024
Comparable earnings per common share is expected to be lower than 2023 due to the net impact of higher net income attributable to non-controlling interests as a result of the sale of a 40 per cent non-controlling equity interest in Columbia Gas Transmission, LLC (Columbia Gas) and Columbia Gulf Transmission, LLC (Columbia Gulf) in 2023, partially offset by increased comparable EBITDA and higher AFUDC related to increased capital expenditures on the Southeast Gateway pipeline project
Our 2024 comparable EBITDA and comparable earnings per common share outlooks reflect a full year impact of contributions from the Liquids Pipelines business and does not take into consideration the potential impact of the $3.0 billion capital rotation program or proposed spinoff of the Liquids Pipelines business (the spinoff Transaction) that is subject to TC Energy shareholder and court approvals, favourable tax rulings, other regulatory approvals and satisfaction of other customary closing conditions
2024 capital expenditures are anticipated to be approximately $8.5 to $9.0 billion on a gross basis including capitalized interest, or approximately $8.0 to $8.5 billion on a net basis after considering non-controlling interests. The majority of our 2024 program is focused on the advancement of the Southeast Gateway pipeline project, U.S. Natural Gas Pipelines projects, post-construction and reclamation activities on the Coastal GasLink pipeline project, the Bruce Power Major Component Replacement (MCR) programs, and normal course maintenance capital expenditures
TC Energy’s Board of Directors approved a 3.2 per cent increase in the quarterly common share dividend to $0.96 per common share for the quarter ending March 31, 2024, equivalent to $3.84 per common share on an annualized basis
Placed approximately $5.3 billion of projects in service in 2023 on budget, and expect to place approximately $7.0 billion of new projects in service in 2024
Advanced our capital rotation program in 2023, with $3.0 billion of incremental asset sales expected to be completed by year end 2024
Closed the sale of a 40 per cent non-controlling equity interest in Columbia Gas and Columbia Gulf to Global Infrastructure Partners (GIP) for total cash proceeds of $5.3 billion (US$3.9 billion). Preceding the close of the equity sale, on August 8, 2023, Columbia Pipelines Operating Company LLC and Columbia Pipelines Holding Company LLC issued US$4.6 billion and US$1.0 billion of long-term, senior unsecured debt, respectively. Net proceeds from the offerings were used to repay existing intercompany indebtedness with TC Energy entities and directed towards reducing leverage
Named Van Dafoe as incoming Senior Vice-President and Chief Financial Officer (CFO) and Lori Muratta as incoming Senior Vice-President and General Counsel (GC) at South Bow Corporation (South Bow) to continue to progress the spinoff Transaction. The Company has received a favourable tax ruling from the IRS on the spinoff Transaction and is continuing to work collaboratively with the CRA on obtaining a favourable tax ruling in Canada
FERC approved the VR and WR projects in November and December 2023, respectively
Placed the US$0.1 billion Virginia Electrification project in service in February 2024, on time and on budget
Approved the US$0.9 billion Heartland project in February 2024, which is an expansion project on our ANR System that is expected to increase capacity and improve system reliability with an anticipated in-service date in late 2027
The final cost and schedule estimate for the Bruce Power Unit 4 MCR program was submitted to the Independent Electricity System Operator (IESO) on December 13, 2023, and received IESO approval on February 8, 2024. The Unit 4 MCR is expected to commence in first quarter 2025 and is expected to be completed in 2028
The noted approved projects fit within the capital plan disclosed at our 2023 Investor Day. We remain committed to limiting annual net capital expenditures to $6.0 to $7.0 billion, with a bias to the lower end beyond 2024.
three months ended
December 31
year ended
December 31
(millions of $, except per share amounts)
2023
2022
2023
2022
Income
Net income (loss) attributable to common shares
1,463
(1,447
)
2,829
641
per common share – basic
$1.41
($1.42
)
$2.75
$0.64
Segmented earnings (losses)
Canadian Natural Gas Pipelines
692
(2,592
)
(90
)
(1,440
)
U.S. Natural Gas Pipelines
955
882
3,531
2,617
Mexico Natural Gas Pipelines
150
96
796
491
Liquids Pipelines
309
322
1,011
1,123
Power and Energy Solutions
263
298
1,004
833
Corporate
(42
)
(4
)
(116
)
8
Total segmented earnings (losses)
2,327
(998
)
6,136
3,632
Comparable EBITDA
Canadian Natural Gas Pipelines
1,034
768
3,335
2,806
U.S. Natural Gas Pipelines
1,225
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