Kinder Morgan Energy Partners distributable cash flow up 13% in Q2

By Lisa Kerner

Charlotte, N.C., July 18 - Kinder Morgan Energy Partners, LP's second quarter was "solid," according to chairman and chief executive officer Richard D. Kinder, who provided details during the company's earnings call on Wednesday.

Second-quarter distributable cash flow before certain items was $366 million, up 13% from $324 million for the prior-year period.

For the first six months of 2012, Kinder Morgan reported distributable cash flow before certain items of $828 million, up 17% from $706 million for the comparable period in 2011.

Net income for the second quarter before certain items was $467 million, compared with $393 million for the second quarter of 2011.

For the six-month period, net income before certain items was $1.0 billion, compared with $800 million for the first six months of 2011.

Kinder Morgan declared a quarterly cash distribution per common unit of $1.23 payable on Aug. 14 to unitholders of record as of July 31, a 7% increase over the second-quarter 2011 cash distribution per unit of $1.15, a company news release said.

During the second quarter, Kinder Morgan sold common units valued at about $154 million under its at-the-market program, and its total was about $278 million for the first half of the year. In addition, the company issued about $300 million of KMP units in its acquisition of midstream assets from Kohlberg Kravis Roberts & Co. in June.

Looking ahead

Kinder Morgan expects to declare cash distributions of $4.98 per unit for 2012, an 8% increase over the $4.61 it distributed for 2011.

The company expects distributable cash flow to remain "essentially equivalent" to its distributions due to deteriorating natural gas liquids prices.

For the year, the company plans to invest about $2.2 billion in expansions, including contributions to joint ventures, and acquisitions.

More than $490 million of the equity required for the investment program is expected to be funded by Kinder Morgan Management, LLC dividends, the release said.

Kinder Morgan is a petroleum pipeline company based in Houston.

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