CALGARY, AB – Gibson Energy Inc. announced today its financial and operating results for the three and nine months ended September 30, 2021.
“We are pleased to report another strong quarter from both an operational and financial perspective, with our Infrastructure segment run-rate increasing with a partial quarter contribution from the DRU beginning operation and Marketing performance within our initial outlook,” said Steve Spaulding, President and Chief Executive Officer. “Our focus remains on securing incremental growth projects while maintaining the 5x to 7x EBITDA build multiples that we have consistently achieved over the past several years. We have also continued to advance Sustainability and ESG at Gibson, recently adopting a Net Zero by 2050 target and being recognized with a “AAA” rating by MSCI ESG Ratings.”
Financial Highlights:
- Revenue of $1,808 million in the third quarter, a $443 million or 33% increase over the third quarter of 2020, a result of higher commodity prices and volumes increasing contribution from the Marketing Segment
- Infrastructure Adjusted EBITDA(1) of $104 million in the third quarter, an $8 million or 9% increase over the third quarter of 2020, due to additional tankage in service at Hardisty as well as a contribution from the DRU for a portion of the current quarter
- Marketing Adjusted EBITDA of $16 million in the third quarter, a $3 million or 23% increase over the third quarter of 2020, reflecting slightly improved margins in the Crude Marketing business
- Adjusted EBITDA on a consolidated basis of $111 million, a $10 million or 10% increase over the third quarter of 2020, due to the factors discussed above
- Net Income of $36 million in the third quarter, an $18 million or 105% increase over the third quarter of 2020, a result of debt extinguishment costs in the prior quarter as well as the factors described above
- Distributable cash flow of $71 million in the third quarter, a $6 million or 9% increase over the third quarter of 2020, with increased contributions from both the Infrastructure and Marketing segments being partly offset by higher replacement capital and taxes in the current quarter
- Payout ratio on a trailing twelve-month basis of 72%, near the low end of Gibson’s 70% – 80% target range
- Maintained a strong financial position, with Net Debt to Pro Forma Adjusted EBITDA at September 30, 2021 of 3.2x, within the Company’s 3.0x – 3.5x target range, and remain fully-funded for all sanctioned capital
Strategic Developments and Highlights:
- Commenced operation of the DRU on-schedule and within expected capital cost
- Announced the addition of Ms. Juliana Lam to the Company’s Board of Directors, who will also serve on the Audit Committee
- Subsequent to the quarter, received the top “AAA” rating from MSCI ESG Ratings, being only one of three companies globally in the Oil & Gas Refining, Marketing, Transportation & Storage industry and the only company in North America in that industry to receive this leadership rating
- Subsequent to the quarter, announced an ambitious Net Zero by 2050 target. As part of ensuring the Company has a credible path to reaching this target, identified the ability to reduce approximately 90% of current Scope 1 and 2 emissions through the application of existing technologies already in commercial use in North America
(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 and nine months ended September 30, 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 third 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 and nine months ended September 30, 2021, as compared to the three and nine months ended September 30, 2020. These documents are available at www.gibsonenergy.com and at www.sedar.com.
2021 Third Quarter Results Conference Call
A conference call and webcast will be held to discuss the 2021 third quarter financial and operating results at 7 a.m. Mountain Time (9 a.m Eastern Time) on Tuesday, Nov. 2, 2021.
The conference call dial-in numbers are:
- 416-764-8659 / 1-888-664-6392
- Conference ID: 31512031
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 November 16, 2021, using the following dial-in numbers:
- 416-764-8677 / 1-888-390-0541
- Replay Entry Code: 512031#
Supplementary Information
Gibson has also made available certain supplementary information regarding the 2021 third quarter financial and operating results, available at www.gibsonenergy.com.