Kinder Morgan Dividend Increase

Kinder Morgan Inc (KMI) announced a 2.08% increase in its cash dividend! The quarterly cash dividend will increase from $0.48 to $0.49 per share and payable on Aug 14, 2015 to shareholders on record as of Jul 31, 2015. The annual dividend rate goes up from $1.92 to $1.96. Yield going forward is 5.22%.

We are pleased with the large increase in our project backlog which demonstrates our continued ability to leverage our unparalleled asset footprint and provides additional support for future growth,” said Executive Chairman Richard D. Kinder. “For the second quarter, KMI had steady results and increased its dividend to $0.49 per share. We remain on track to meet our full-year dividend target of $2.00 per share. While commodity prices continued to pressure the industry this quarter, we continued to produce strong results due mainly to our large, diversified asset portfolio and fee-based cash flows predominantly supported by take-or-pay contracts. We earned distributable cash flow before certain items of $0.50 per share for the second quarter, which equates to coverage in excess of our dividends of $20 million bringing total coverage to $226 million for the first six months. Our five business segments produced $1.827 billion in segment earnings before DD&A and certain items, up 2 percent from the second quarter 2014, primarily driven by increases in our Products Pipelines and Terminals segments offsetting a decline in our CO2segment.
President and CEO Steve Kean said, “Our current project backlog of expansion and joint venture investments is $22.0 billion. Since the first quarter earnings release, we have placed nearly $700 million of completed projects into service, removed approximately $600 million in projects (primarily in the CO2 segment as a result of additional CO2 source and transportation projects being delayed beyond the time horizon of our five-year backlog due to lower commodity prices) and added approximately $5.0 billion driven by new projects, particularly the $3.3 billion market path portion of the Northeast Energy Direct project – and the incremental $630 million investment resulting from KMI’s agreement to acquire Shell’s 49 percent equity interest in the Elba Liquefaction Company. Projects in the backlog have a high certainty of completion and drive future growth at the company across all of our business segments.

 

My portfolio consists of 103 shares of KMI, which increases my annual dividends from $197.76 to $201.88, an increase of $4.12.

 

9 thoughts on “Kinder Morgan Dividend Increase

  1. I had also read about this yesterday. Good news for sure, however, their payout ratio seems a bit…over the top? They are quite the paradox in that they have such a high payout ratio, more than double their peers, yet they also have a higher profit margin, lower debt to equity, and a higher cash flow rate. I did not know you held so many shares, I only have 40 and they’ve been quite good to me thus far. Thanks for the update.

    – HMB

    • Yup….there were a lot of questions, but KMI has kept its promise on the dividend raises and is on track. Love the visibility the management provides and the regular-as-clockwork raises.

      cheers
      R2R

  2. “Mmm, a 2.08% increase… that’s OK but not exactly exhilarating!”

    Thinking like that would be a mistake! KMI has now increased in 6 consecutive quarters and compared with the year ago quarter, KMI’s dividend has increased 14.3%.

    Congratulations!
    FerdiS

    • Absolutely, FerdiS. The dividend growth record for KMI is fantastic! I love how transparent they’ve been with the shareholders and have managed to achieve those goals set a while ago. Looking forward to more continued growth in dividends in the coming quarters.

      cheers
      R2R

  3. Any increase is a good increase. This is a company that knows how to keep its shareholders happy!

    Sincerely,
    ARB–Angry Retail Banker

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