EnLink Midstream reports strong second quarter 2024 results

EnLink Midstream, led by president and chief executive officer Jesse Arenivas, has reported robust financial results for the second quarter of 2024. Arenivas stated, “EnLink delivered a solid quarter in line with our expectations, as our midstream assets and our diversified business continue to show resilience. Our Louisiana team is executing on a multiprong growth strategy and moving projects toward commercialization, such as the ‘Henry Hub to the River’ project announced last quarter and the JISH expansion announced today, to supply the high-demand market for natural gas. EnLink’s strength is in our diverse, integrated value chain, which we continue to leverage for new opportunities that optimize and grow our business.”

The company reported notable financial metrics, including an adjusted EBITDA of $306 million and net cash provided by operating activities of $163 million. The quarter also saw a free cash flow after distributions of $53 million, despite capital expenditures and plant relocation costs totaling $103 million.

Financial Highlights:

Net Income: $67 million, up from $50 million in the first quarter of 2024 but down from $90 million in the second quarter of 2023.
Adjusted EBITDA: $306 million, down from $338 million in the previous quarter and $334 million in the same quarter last year.
Net Cash Provided by Operating Activities: $163 million, a significant decrease from $293 million in the first quarter and $316 million in the second quarter of 2023.
Free Cash Flow After Distributions: $53 million, compared to $74 million in the previous quarter and $96 million in the second quarter of 2023.
Debt to Adjusted EBITDA Ratio: 3.3x, consistent with the first quarter and slightly improved from 3.4x in the second quarter of 2023.

Segment Performance:

Permian Basin:

Segment Profit: $93.1 million, including $16.8 million in plant relocation expenses and $1.3 million in unrealized derivative losses. Excluding these, the segment profit grew approximately 10 percent sequentially and year-over-year.
Natural Gas Gathering Volumes: Increased by approximately 7 percent from the first quarter of 2024 and 17 percent from the second quarter of 2023.
Natural Gas Processing Volumes: Increased by approximately 6 percent sequentially and 14 percent year-over-year.
Crude Gathering Volumes: Increased by approximately 16 percent sequentially and 23 percent year-over-year.
Notable Achievement: The third plant relocation, Tiger II, commenced operations in May.

Louisiana:

Segment Profit: $84.3 million, including $5.6 million in unrealized derivative gains. Excluding these, the segment profit decreased approximately 39 percent sequentially and 9 percent year-over-year, due to seasonal effects in the NGL segment.
Natural Gas Transportation Volumes: Increased by approximately 2 percent sequentially and 20 percent year-over-year.
NGL Fractionation Volumes: Decreased by approximately 5 percent sequentially and 2 percent year-over-year.
Key Development: Final Investment Decision on the Stage 1 brownfield expansion project at JISH, expected to add 8 Bcf of working gas storage by 2028.

Oklahoma:

Segment Profit: $103.5 million, including $0.1 million in plant relocation expenses and $0.8 million in unrealized derivative gains. Excluding these, the segment profit grew 14 percent sequentially but decreased approximately 5 percent year-over-year.
Natural Gas Gathering Volumes: Increased by approximately 7 percent sequentially but decreased by 3 percent year-over-year.
Natural Gas Processing Volumes: Increased by approximately 8 percent sequentially but decreased by 3 percent year-over-year.
Crude Gathering Volumes: Decreased by approximately 13 percent sequentially and 34 percent year-over-year.

North Texas:

Segment Profit: $52.4 million, including $1.1 million in unrealized derivative losses. Excluding these, the segment profit decreased approximately 11 percent sequentially and 28 percent year-over-year, reflecting the impact of a one-time contract reset.
Natural Gas Gathering and Transportation Volumes: Increased by approximately 2 percent sequentially but decreased by 8 percent year-over-year.
Natural Gas Processing Volumes: Increased by approximately 1 percent sequentially but decreased by 8 percent year-over-year.