ALTAGAS REPORTS STRONG THIRD QUARTER 2025 RESULTS
Executive Summary
- AltaGas reported Q3 2025 results with normalized EBITDA of $268 M (down 9% YoY) and a GAAP loss of $0.08 per share, but reaffirmed FY 2025 guidance for normalized EPS $2.10‑$2.30 and EBITDA $1.775‑$1.875 B.
- The company announced positive final investment decisions (FIDs) on several organic growth projects: REEF Optimization One ($110 M), Keweenaw Connector Pipeline ($135 M), and Phase One Dimsdale gas storage expansion ($65 M).
- Issuance of $200 M 5.375% junior subordinated hybrid notes (Series 4) was completed, with expected cash‑flow savings of ~$30 M over five years.
Key Details
- Financial Highlights
- Normalized EBITDA: $268 M vs. $294 M YoY.
- GAAP EPS: –$0.08 vs. +$0.03 YoY.
- Normalized EPS: $0.04 vs. $0.14 YoY.
- Cash from operations: $34 M (up from $21 M).
-
Dividends declared: $0.315 per common share (payable Dec 31, 2025).
-
Midstream Segment
- Normalized EBITDA: $204 M (+13% YoY).
- Record LPG export volume: 133,147 bbl/d (4% YoY increase).
-
Dimsdale storage utilization near capacity; Phase One expansion to add 6 Bcf (capital cost ~$65 M, capex/EBITDA multiple ~5×).
-
Utilities Segment
- Normalized EBITDA: $68 M (down from $117 M YoY) – impact of pension‑plan settlement absence.
-
Capital deployed Q3: $206 M total; $121 M on modernization programs.
-
Growth Project FIDs
- REEF Optimization One (partner Vopak): Gross capex ~$110 M ($55 M net to AltaGas), adds ~25,000 bbl/d throughput, in‑service H2 2027.
- Keweenaw Connector Pipeline (Michigan): Capex ~$135 M, 30‑mile line serving 14,000 customers, early‑2027 in‑service.
-
Dimsdale Phase One Expansion: $65 M capex, adds 6 Bcf storage, contracts with Tourmaline Oil and Gunvor, targeted year‑end 2026.
-
Mountain Valley Pipeline (MVP) Update
- Current capacity 2.0 Bcf/d operating near full utilization.
- Boost Expansion increased by 20% to add 600 MMcf/d; $450 M capex, targeted mid‑2028, fully contracted.
-
Southgate Project environmental assessment completed; no significant adverse impacts identified.
-
Financing Activity
- Issued $200 M of 5.375% Fixed‑to‑Fixed Rate Junior Subordinated Hybrid Notes, Series 4, due Dec 5 2055.
-
Proceeds used to redeem Series A & B preferred shares; expected cash‑flow savings ≈$30 M over first five years versus prior preferred dividend reset rate.
-
Guidance reaffirmed
- FY 2025 Normalized EPS: $2.10–$2.30 (vs. $2.18 reported FY 2024).
-
FY 2025 Normalized EBITDA: $1.775–$1.875 B (vs. $1.769 B FY 2024).
-
Dividends
- Common share dividend $0.315 per share, payable Dec 31 2025; record date Dec 16 2025.
- Series G preferred dividend $0.376063 per share for period Sep‑Dec 2025.
Notable Quotes
- “We’re pleased with our strong third quarter performance… and reaffirmed our 2025 guidance,” – Vern Yu, President & CEO.
- “The long‑term fundamentals for natural gas and NGLs remain constructive, supporting the positive FIDs we’ve made within our midstream business.” – Vern Yu.