Pipeline operator, TC PipeLines LP (TCP) reported better-than-expected fourth-quarter 2014 results. Higher equity earnings from the Great Lakes and Northern Border Pipeline, in addition to increased income from Bison led to the upside.
The Calgary, Alberta-based master limited partnership (MLP) posted fourth-quarter earnings per unit (EPU) of 71 cents, ahead of the Zacks Consensus Estimate as well as the year-ago quarter earnings, both of which were 63 cents per unit.
For 2014, TC PipeLines reported per unit profits of $2.67, above the Zacks Consensus Estimate of $2.61 and the 2013 earnings of $2.13 per unit.
Distribution & Cash Flows
TC PipeLines announced fourth-quarter cash distribution of 84 cents per unit ($3.36 per unit annualized), in line with the previous quarter’s distribution.
The partnership’s total cash flow during the reported quarter increased about 7.6% year over year to $57 million. The increase was a result of higher contribution from Bison following its acquisition in 2014.
TC PipeLines distributed $54 million in the reported quarter, up almost 4% from the year-ago level.
Pipeline Systems’ Performance
Great Lakes: The partnership’s equity income from Great Lakes was $6 million, up from $3 million reported in the year-ago quarter.
Northern Border Pipeline: Equity income from the Northern Border Pipeline was flat year-over-year at $16 million.
Liquidity
As of Dec 31, 2014, TC PipeLines had $170 million outstanding on the $500 million senior credit facility. The partnership had a long-term debt of $1,446 million, representing a debt-to-capitalization ratio of 47.7%.
Acquisition
On Feb 24, 2015, TC PipeLines entered into an agreement to acquire the remaining 30% interest in the Gas Transmission Northwest LLC from TransCanada Corporation (TRP). The transaction is valued at $446 million.
Zacks Rank
TC PipeLines currently holds a Zacks Rank #2 (Buy).
Better-ranked players from the same industry include Delek Logistics Partners, LP (DKL) and Energy Transfer Equity, L.P. (ETE). Both Delek Logistics and Energy Transfer Equity hold a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment