Tc Energy Corporation · TSX:TRP
Tc Energy — Q1 2022 Earnings Presentation
27 slides from Tc Energy's earnings presentation, Apr 29, 2022
Slide 1: First quarter 2022 conference call
First quarter 2022 conference call APRIL 29, 2022
Slide 2: Forward-looking information and non-GAAP measures
Forward-looking information and non-GAAP measures This presentation includes certain forward-looking information, including, but not limited to, statements related to future dividend and earnings growth, future EBITDA growth, the future growth of our core businesses, the sustainability commitments a
Slide 3: François Poirier, President and Chief Executive Officer
François Poirier President and Chief Executive Officer APRIL 29, 2022
Slide 4: Connecting North America's premier basins to LNG export terminals on every coast
Connecting North America’s premier basins to LNG export terminals on every coast LNG Export Forecast Bcf/d Forecast: 2022-2030 (over 90% growth) Operational, TC Energy connected Next Wave U.S. LNG affiliated projects • In service – Grand Chenier XPress (1.1 Bcf/d) • Progressing – Louisiana XPress (0
Slide 5: U.S. Natural Gas Pipelines
OPERATING HIGHLIGHTS – Q1 2022 U.S. Natural Gas Pipelines • Daily average flows were 30 Bcf/d, up 5 per cent versus 2021 • Numerous all-time flow records despite warmer than average winter season • January 7 – Columbia Gas set all-time sendout record of 10.4 Bcf • January 27 – PNGTS set an all-time
Slide 6: Canadian Natural Gas Pipelines
OPERATING HIGHLIGHTS – Q1 2022 Canadian Natural Gas Pipelines • NGTL experienced highest average winter demand since 2000 of 14.2 Bcf/d • Canadian Mainline experienced additional contracting, and is currently sold-out of long-term firm capacity Mmcf/d NGTL Winter Demand Growth 2019-2022
Slide 7: Coastal GasLink
PROJECT HIGHLIGHTS – Q1 2022 Coastal GasLink 16 First Nations across the project corridor sign historic Equity Option Agreements for 10 per cent ownership interest in CGL • Project surpasses 63 per cent completion • 100 per cent of the project route has been cleared • Over $1 billion in contracts ha
Slide 8: Power and Storage
PROJECT HIGHLIGHTS – Q1 2022 Power and Storage Bruce Power • The IESO accepted the MCR3 Basis of Estimate, clearing the way for the power price increase received on April 1, 2022 • Unit 3 MCR Project will begin in early 2023 with expected completion in 2026 RFI process • Finalized contracts for ~160
Slide 9: Alberta Carbon Grid
Part of TC Energy’s and Pembina’s commitment to energy diversification, industry collaboration and a lower-carbon future ACG will be capable of ACG will have a vital role to transporting and play to support the ACG has been invited into the next stage of sequestering up to Carbon Alberta’s 20 millio
Slide 10: Substantial suite of opportunities to extend our growth horizon
Substantial suite of opportunities to extend our growth horizon $Billions Electrification of our pipeline network Using renewables to power a portion of our pipeline network Other in-corridor growth Incremental Capital-light investments and enhanced returns on existing assets investments and future
Slide 11: 2022 Priorities and progress
2022 Priorities and progress Q1 Highlights Safely deliver the energy people need, every day Placed $0.5 billion in service year-to-date Increase return on capital invested in existing assets Finalized contracts for 160 MW and 240 MW from wind energy and solar projects, respectively Place $6.5 billio
Slide 12: Joel Hunter, Executive Vice-President and Chief Financial Officer
Joel Hunter Executive Vice-President and Chief Financial Officer APRIL 29, 2022
Slide 13: Financial highlights – quarter ended March 31
Financial highlights(1) – quarter ended March 31 Comparable earnings Comparable EBITDA(2) Comparable funds generated from operations(2) per common share(2) (dollars) (millions of dollars) (millions of dollars) Executing an opportunity-rich portfolio while supplying the growing demand for energy (1)
Slide 14: Consolidated results of operations
Consolidated results of operations (millions of dollars, except per share amounts) Three months ended March 31 2022 2021 Net income attributable to common shares 358 (1,057) Specific items (net of tax): Great Lakes goodwill impairment charge 531 - Settlement-in-principle of Mexico prior years’ incom
Slide 15: Business segment results
Business segment results(1) (millions of dollars) Three months ended March 31 2022 2021 Comparable EBITDA(2) Canadian Natural Gas Pipelines 644 686 U.S. Natural Gas Pipelines 1,107 1,055 Mexico Natural Gas Pipelines 148 180 Liquids Pipelines 329 393 Power and Storage 157 178 Corporate 3 (3) Total 2,
Slide 16: Other income statement items
Other income statement items(1) (millions of dollars) Three months ended March 31 2022 2021 Comparable EBITDA(2) 2,388 2,489 Depreciation and amortization (626) (645) Comparable EBIT(2) 1,762 1,844 Interest expense(3) (580) (570) Allowance for funds used during construction 75 50 Interest income and
Slide 17: 2022 Outlook
2022 Outlook • Comparable EBITDA is expected to be modestly higher than 2021 • Comparable earnings per share are expected to be consistent with 2021 • Total capital expenditures for 2022 expected to be ~$7 billion • Primarily due to higher costs for the NGTL System, reflecting inflationary pressures
Slide 18: Funding program outlook 2022-2024E
Funding program outlook 2022-2024E $Billions Comparable funds generated from operations(1) expected to remain robust • $1.9 billion in the first quarter • Reflects the resiliency and criticality of our energy infrastructure portfolio Financial strength and flexibility underpinned by: • Robust, predi
Slide 19: Comparable EBITDA Outlook
Advancing $25 billion secured capital program Expect to place $6.5 billion of assets in service in 2022 $Billions Canadian U.S. $Billions regulated Canadian maintenance regulated Additional growth maintenance Mainline $2.1 $0.2 opportunities and US$2.0 2022-2024 2022-2024 2022 enhancements Comparabl
Slide 20: Stable and consistent dividend growth
Stable and consistent dividend growth $3.60* Declared a second quarter 2022 dividend of $0.90 per share Equivalent to $3.60 per share annually Twenty-two consecutive years of common share dividend increases with 3-5% expected future growth per annum *Annualized based on second quarter dividend decla
Slide 21: Delivering long-term shareholder value
Delivering long-term shareholder value Track record Visible growth 13% average annual total shareholder $25 billion secured capital program through 2028 return since 2000 Vast opportunity set emanating from unparalleled footprint and organizational capabilities Attractive dividend Solid financial po
Slide 22: Question & answer period
Question & answer period Call participants François Poirier - President and Chief Executive Officer Joel Hunter - Executive Vice-President and Chief Financial Officer Stanley G. Chapman, III - Executive Vice-President and President, U.S. and Mexico Natural Gas Pipelines Corey Hessen - Executive Vice
Slide 23: First quarter 2022 conference call
First quarter 2022 conference call APRIL 29, 2022
Slide 24: Appendix A – Financial highlights comparable GAAP measures
Appendix A – Financial highlights comparable GAAP measures Quarter ended March 31, 2022 Net Income per Common Share Segmented Earnings Net Cash Provided by Operations (dollars) (millions of dollars) (millions of dollars)
Slide 25: Appendix B – Business segment results comparable GAAP measure
Appendix B – Business segment results comparable GAAP measure (millions of dollars) Three months ended March 31 2022 2021 Segmented Earnings Canadian Natural Gas Pipelines 358 356 U.S. Natural Gas Pipelines 310 873 Mexico Natural Gas Pipelines 120 152 Liquids Pipelines 272 (2,508) Power and Storage
Slide 26: Appendix C – Comparable EBITDA and comparable earnings comparable GAAP measure
Appendix C – Comparable EBITDA and comparable earnings comparable GAAP measure (millions of dollars) Three months ended March 31 2022 2021 Comparable EBITDA(1) 2,388 2,489 Depreciation and amortization (626) (645) Interest expense included in comparable earnings (580) (570) Allowance for funds used
Slide 27: Appendix D – Funds generated from operations comparable GAAP measure
Appendix D – Funds generated from operations and comparable funds generated from operations comparable GAAP measure (millions of dollars) Three months ended March 31 2022 2021 Net Cash Provided by Operations 1,707 1,666 (Decrease)/increase in operating working capital (40) 232 Funds Generated from O