Keyera expects strong free cash flow generation in 2024 following record year
Published: 10:41 12 Dec 2023 EST
Keyera (TSX:KEY) told shareholders on Tuesday that it is on track for a record year in 2023 along with issuing financial guidance for the new year.
The Calgary, Alberta-based midstream energy infrastructure business said it maintained financial strength during 2023 with its net debt to adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) at 2.5 times as of the end of the third quarter.
It said it is on track to deliver record distributable cash flow per share for the full year, in addition to increasing its dividend by 4.2% for shareholders.
Keyera (TSX:KEY) also said it expects to reach the upper end of its adjusted EBITDA compound annual growth rate target of 6% to 7% between 2022 and 2025.
In 2024, it expects capital growth in the range of $80 million and $100 million Maintenance capital is expected to be between $90 million and $110 million, with $20 million recoverable in 2024 and a further $15 expected to be recoverable in future years.
"The fundamentals for natural gas liquids volume growth in the Western Canada Sedimentary Basin remain strong and the recent investments we have made position Keyera (TSX:KEY) to benefit for many years to come, as an essential enabler of this growth,” Keyera (TSX:KEY) CEO Dean Setoguchi said in a statement.
“As we look to 2024, we will experience continued growth from investments made in prior years coupled with lower capital spending. This is anticipated to result in strong free cash flow generation after funding dividends and growth capital."
Keyera (TSX:KEY) shares traded modestly lower on Tuesday morning, down 0.4% at C$33. The stock has gained about 15% in the year to date.
