Acquisitions Power Kinder Morgan Inc (KMI)’s Earnings

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  • Terminals earnings grew 5% year over year to $191 million. It should be noted that as the Copano and El Paso acquisitions make the earnings headlines, this segment had mostly organic growth, driven by increasing coal export volumes, and new or restructured contracts sporting higher rates. Domestic coal volumes continue to drop, however, as do steel volumes.
  • Kinder Morgan Canada was the one underperforming segment in the second quarter, earning $50 million in 2013, compared to $52 million last year. This is solely because of the sale of the Express-Platte system, which management has said will be accretive when all is said and done, though this segment will continue to post lower numbers year over year. As far as a future outlook goes, Canada’s National Energy Board has approved the commercial terms of Kinder Morgan Inc (NYSE:KMI)’s Trans Mountain expansion. The partnership will submit its facilities application for building and operation later this year. If all goes according to plan, the expansion is slated to be in service by 2017.
  • Clearly, the partnership’s two most recent acquisitions are really making an impact, especially in the natural gas segment. However, the Kinder Morgan’s diversity remains its core strength.

    Foolish takeaway
    The strong quarterly performance means that Kinder Morgan Inc (NYSE:KMI) is able to remain on track with its dividend and distribution growth. Both KMI and Kinder Morgan Energy Partners LP (NYSE:KMP) increased their quarterly payout to $0.40 and $1.32, respectively. Both entities are expected to hit their annualized targets of $1.60 and $5.33 per unit.

    The article Acquisitions Power Kinder Morgan’s Earnings originally appeared on Fool.com.

    Fool contributor Aimee Duffy has no position in any stocks mentioned. The Motley Fool recommends Kinder Morgan Inc (NYSE:KMI). The Motley Fool owns shares of Kinder Morgan.

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