EnLink Midstream LLC Reports Solid Growth in 2023, Sets Positive Outlook for 2024
Net Income: Reported $100.1 million for Q4 and $350.0 million for the full year of 2023.
Adjusted EBITDA: Achieved $350.8 million in Q4 and $1.35 billion for the full year, marking a 5% year-over-year growth.
Free Cash Flow After Distributions (FCFAD): Generated $79.4 million in Q4 and $247.0 million for the full year.
Distributions: Increased quarterly distribution by approximately 6% to $0.1325 per unit.
Common Unit Repurchases: Approximately $90 million in Q4, totaling $250 million for 2023.
2024 Financial Guidance: Expects adjusted EBITDA between $1.31 billion and $1.41 billion and FCFAD of approximately $290 million.
Debt to Adjusted EBITDA Ratio: Maintained at 3.3x as of December 31, 2023.
On February 20, 2024, EnLink Midstream LLC (NYSE:ENLC) released its 8-K filing, detailing its financial performance for the fourth quarter and full year of 2023, and providing financial guidance for 2024. EnLink Midstream LLC, an integrated midstream company, operates across various segments with the Louisiana segment being the most significant revenue contributor. The company specializes in natural gas pipelines, processing plants, and NGL assets, amongst other services.
Financial Highlights and Achievements
EnLink Midstream LLC reported a net income of $100.1 million for the fourth quarter and $350.0 million for the full year of 2023. The company generated a robust adjusted EBITDA of $350.8 million for the fourth quarter and $1.35 billion for the full year, representing a 5% growth compared to 2022. This performance underscores the company's operational strength and strategic initiatives, which are crucial for maintaining competitiveness in the Oil & Gas industry.
Free cash flow after distributions (FCFAD) was reported at $79.4 million for the fourth quarter and $247.0 million for the full year, driven by strong operational results. The company also demonstrated its commitment to shareholder returns by increasing its quarterly distribution to $0.1325 per unit and repurchasing approximately $90 million in common units during the fourth quarter. These financial achievements highlight EnLink's ability to generate substantial cash flows and return capital to its unitholders, a key aspect for value investors in the midstream sector.
Performance Analysis and 2024 Outlook
EnLink Midstream LLC's performance in 2023 was marked by several strategic accomplishments, including the successful launch of its North Texas carbon capture and sequestration project with BKV, and an upsized $250 million common unit repurchase program. CEO Jesse Arenivas commented on the company's record year, noting the achievement of guidance metrics for adjusted EBITDA and free cash flow after distributions.
EnLink delivered another record year by generating adjusted EBITDA of $1.35 billion, achieving the midpoint of 2023 guidance and 5% growth over the prior year," said Jesse Arenivas, EnLink Chief Executive Officer. "Through solid execution and operational excellence, we delivered on our 2023 guidance metrics for adjusted EBITDA and free cash flow after distributions."
Looking ahead to 2024, EnLink expects continued growth with adjusted EBITDA guidance ranging from $1.31 billion to $1.41 billion, which represents approximately 4% growth over 2023, excluding certain effects. The company also anticipates generating approximately $290 million in FCFAD based on the midpoint of 2024 guidance. These projections are indicative of EnLink's confidence in its business model and its ability to capitalize on growth opportunities within its operating segments.
EnLink's financial tables reveal a debt to adjusted EBITDA ratio of 3.3x as of December 31, 2023, maintaining a stable leverage profile. The company's common units outstanding as of February 14, 2024, totaled 453,176,911.
For a detailed review of EnLink Midstream LLC's financial performance and the complete 8-K filing, please visit the SEC website.
EnLink Midstream LLC's solid financial results and positive outlook for 2024 reflect its strategic positioning and operational efficiency in the midstream oil and gas sector. The company's focus on delivering value to shareholders through consistent financial performance and capital return initiatives positions it favorably for continued success in the coming year.
Explore the complete 8-K earnings release (here) from EnLink Midstream LLC for further details.
This article first appeared on GuruFocus.
