Kinder Morgan, Inc. (NYSE: KMI) today reported first quarter cash available to pay dividends of $303 million, up 14 percent from $267 million compared to the same period a year ago and slightly ahead of its published annual budget.
The board of directors increased the quarterly dividend to $0.32 per share ($1.28 annualized), payable on May 16, 2012, to shareholders of record as of April 30, 2012. This represents a 10 percent increase over the quarterly dividend of $0.29 per share ($1.16 annualized) that was announced when KMI was taken public Feb. 16, 2011.
Chairman and CEO Richard D. Kinder said, “KMI had a very good quarter, benefiting from the performance of our publicly traded limited partnership, Kinder Morgan Energy Partners (NYSE: KMP). KMI’s future growth will continue to be driven by KMP, which expects an 8 percent increase in declared cash distributions per unit for 2012 versus 2011, and continues to generate stable and incremental cash flow from its diversified assets. Approximately 99 percent of the distributions KMI currently receives are attributable to KMP.”
As previously announced, KMI expects to declare dividends of $1.35 per share for 2012, a 13 percent increase over its 2011 declared dividend of $1.20. (The 2011 per share amounts are presented as if KMI were publicly traded for all of 2011.) This 2012 outlook for KMI does not include the impact of its pending acquisition of El Paso Corporation (NYSE: EP).
El Paso Acquisition
Integration and Growth Expectations
KMI and El Paso integration teams continue to work together to plan for combining the two companies, subject to limitations imposed by anti-trust regulations. “I’m very pleased with the effort that is taking place among the integration teams of both companies,” Kinder said. “As previously announced, we expect to realize cost savings and other synergies totaling approximately $350 million per year. This integration planning effort is being managed and fully staffed by personnel from each of the two organizations, ensuring that the people who understand best how to operate these assets are establishing how they will be managed after we close the deal. This has required remarkable effort by a large number of people who are each still responsible for their normal jobs. The value of their contributions will be realized by the combined organization for many years to come.”