CALGARY, Alberta – Gibson Energy Inc. announced today its financial and operating results for the three months ended March 31, 2021.
“We are very pleased with the solid start to 2021, with our Infrastructure segment performing in-line with our expected run-rate on a normalized basis and Marketing slightly above our initial outlook,” said Steve Spaulding, President and Chief Executive Officer. “Importantly, since the start of the year, we have resumed our commercial discussions with customers, having already entered into a long-term MSA with our largest customer at the Edmonton Terminal and sanctioned the related Biofuels Blending Project under a 25-year term. We continue to advance other opportunities, including tankage at both Hardisty and Edmonton as well as for additional capacity at the DRU. Since the start of the year, we have also significantly progressed our Sustainability and ESG practice by establishing expanded Sustainability and ESG targets with the ambition of remaining a leader relative to our peers.”
- Revenue of $1,610 million in the first quarter, a $151 million or 10% increase over the first quarter of 2020, a result of higher volumes and commodity prices from the Marketing Segment
- Infrastructure Adjusted EBITDA(1) of $109 million in the first quarter, a $14 million or 14% increase over the first quarter of 2020, due to additional tankage in service at Hardisty and the benefit of a $7 million reversal of an accrual in the current quarter
- Marketing Adjusted EBITDA of $3 million in the first quarter, a $29 million decrease over the first quarter of 2020, driven by reduced margins as well as limited opportunities within the Crude Marketing business and reduced sales volumes in the Refined Products business in the current quarter
- Adjusted EBITDA on a consolidated basis of $103 million, a $15 million or 12% decrease over the first quarter of 2020, due to the factors discussed above with G&A comparable between the two periods
- Net Income of $33 million in the first quarter, a $17 million or 34% decrease over the first quarter of 2020, a result of the factors described above, partly offset by lower income tax expense in the current quarter
- Distributable cash flow of $64 million in the first quarter, a $22 million or 26% decrease over the first quarter of 2020, due to a decreased contribution from the Marketing segment being only partly offset by an increase in the Infrastructure segment
- Payout ratio on a trailing twelve-month basis of 72%, at the bottom end of Gibson’s 70% – 80% target range
- Maintained a strong financial position, with Net Debt to Pro Forma Adjusted EBITDA at March 31, 2021 of 3.1x, within the Company’s 3.0x – 3.5x target range, and remain fully-funded for all sanctioned capital
Strategic Developments and Highlights:
- Entered into a long-term agreement with Suncor Energy Inc. for services at the Company’s Edmonton Terminal, and sanctioned the related Biofuels Blending Project on a fixed-fee basis and a 25-year term to facilitate the storage, blending and transportation of renewable diesel
- Continued to progress the construction of the DRU, which remains on-budget and on-schedule for a mid-year commissioning and start of operations
- Established expanded Sustainability and ESG targets focused around reducing GHG emissions, diversity and inclusion, health and safety as well as community impact as the near-term priorities, with an overarching goal of being a Sustainability and ESG leader relative to Gibson’s peers
- Recognized for its Sustainability and ESG efforts by MSCI ESG Research LLC through their assignment of an “AA” rating of Gibson, which would represent the highest ranking among the Company’s North American peer group
- Subsequent to the end of the quarter, became the first public energy company in North America to fully transition its principal syndicated credit facility into one with sustainability-linked terms, while extending the maturity of the $750 million facility to a full five years into 2026
|(1)||Adjusted Earnings before Interest, Tax, Depreciation and Amortization and other adjustments (“Adjusted EBITDA”), Distributable Cash Flow, Interest Coverage Ratio and Dividend Payout Ratio are non-GAAP measures as noted in the section titled “Non-GAAP Financial Measures” section in Gibson’s Management Discussion and Analysis for the three months ended March 31, 2021 (“MD&A”). The applicable definitions and reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are set out in the “Non-GAAP Financial Measures” section of the MD&A. Effective Q1 2021, the Company has updated the manner in which it determines Adjusted EBITDA and prior period comparative figures have been restated to conform to this new presentation. See “Adjusted EBITDA” in this news release and “Non-GAAP Financial Measures” in the MD&A for the definition and reconciliations of Adjusted EBITDA.|
Management’s Discussion and Analysis and Financial Statements
The 2021 first quarter Management’s Discussion and Analysis and unaudited Condensed Consolidated Financial Statements provide a detailed explanation of Gibson’s financial and operating results for the three months ended March 31, 2021, as compared to the three months ended March 31, 2020. These documents are available at www.gibsonenergy.com and at www.sedar.com.
2021 First Quarter Results Conference Call
A conference call and webcast will be held to discuss the 2021 first quarter financial and operating results at 7:00am Mountain Time (9:00am Eastern Time) on Tuesday, May 4, 2021.
The conference call dial-in numbers are:
- 416-764-8659 / 1-888-664-6392
- Conference ID: 46003156
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 May 19, 2021, using the following dial-in numbers:
- 416-764-8677 / 1-888-390-0541
- Replay Entry Code: 137278#
Annual General Meeting & Webcast Details
Gibson is holding its annual meeting of shareholders on Tuesday, May 4, 2021 at 10:00am Mountain Time (12:00 noon Eastern Time). In light of the continued public health concerns regarding COVID-19, shareholders will not be able to attend the meeting in person as it will be held as a virtual-only meeting conducted via live audio webcast. Shareholders will have an equal opportunity to participate at the virtual-only meeting regardless of their geographic location. Participants are encouraged to register for the live audio webcast at least 10 minutes prior to the presentation start time.
Following the conclusion of the formal proceedings of Gibson’s annual shareholder meeting, Mr. Steve Spaulding, President and Chief Executive Officer, will address shareholders and provide brief remarks on the current state of the business and discuss the highlights of the Company’s key initiatives.
The live audio webcast can be accessed using the following URL:
- Password: gibson2021
Additionally, information and materials related to the annual general meeting of shareholders can be accessed using the following URL:
The webcast will remain accessible for a 12-month period at the above URL.
Gibson has also made available certain supplementary information regarding the 2021 first quarter financial and operating results, available at www.gibsonenergy.com.
Gibson Energy Inc. (“Gibson” or the “Company”), (TSX: GEI) is a Canadian-based oil infrastructure company with its principal businesses consisting of the storage, optimization, processing, and gathering of crude oil and refined products. Headquartered in Calgary, Alberta, the Company’s operations are focused around its core terminal assets located at Hardisty and Edmonton, Alberta, and also include the Moose Jaw Facility and an infrastructure position in the U.S.
Gibson shares trade under the symbol GEI and are listed on the Toronto Stock Exchange. For more information, visit www.gibsonenergy.com.