Keyera Corp. Reports Strong Q2 2025 Results with Dividend Boost

Keyera Corp. Reports Strong Q2 2025 Results with Dividend Boost

Keyera Corp. (TSX: KEY), a leading player in the energy sector, has announced its second quarter financial results, showcasing a solid performance driven by a thriving integrated value chain and consistent customer demand.

Notable Highlights

Dean Setoguchi, President and CEO of Keyera, expressed satisfaction with the quarter's results. He stated, "We advanced our strategy with key project sanctions and witnessed robust commercial momentum across our asset base. The strong demand continues to support our sustainable dividend increases, and we are making strides with our acquisition efforts of Plains’ Canadian NGL assets which is set to provide significant benefits to our operations and stakeholders."

Financial Overview

In Q2 2025, Keyera's adjusted EBITDA reached $252 million, albeit down from $326 million in Q2 2024. This decrease includes transaction costs associated with the Plains acquisition. Notably, the Gathering and Processing and Liquids Infrastructure segments both provided significant contributions, while the Marketing segment saw reduced contributions due to unfavorable commodity price conditions.

Distributable Cash Flow

The distributable cash flow for the quarter was reported at $159 million, equivalent to $0.69 per share, compared to $202 million or $0.88 per share in Q2 2024. Keyera remains confident in its financial strategy with a payout ratio still within target ranges, enabling continued dividend increases for investors.

Growth and Expansion Plans

Keyera has indicated ambitious growth targets through various capital projects, particularly the KFS Frac III expansion and the KAPS Zone 4 development. The company achieved substantial contracting momentum, adding more than 100,000 barrels per day of new long-term contracted volumes, which are expected to strengthen its market position.

Sustainable Dividend Growth

In recognition of the positive financial trajectory, Keyera has raised its dividend by 4%. This increase reflects the company's strong confidence in its cash flow stability and growth, ensuring that shareholders benefit from the company's ongoing success.

Acquisition of Plains' NGL Assets

Keyera's acquisition of Plains' Canadian NGL assets represents a significant milestone, with a transaction value positioned at approximately $5.15 billion. This acquisition is anticipated to close in the early part of 2026, pending regulatory approval. Keyera's leadership believes that this deal will enhance their operational efficiency and service delivery, further contributing to value creation for shareholders and customers.

Long-term Strategy

With a focus on financial prudence, Keyera’s management has committed to a disciplined capital allocation approach. The goal remains to maximize long-term value while maintaining a strong financial position and investment-grade credit ratings. As the company embarks on its transformative growth journey, it remains focused on contributing positively to the energy sector.

Frequently Asked Questions

What were Keyera's Q2 2025 earnings?

Keyera reported adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $252 million.

What is the new dividend increase percentage for Keyera?

Keyera has announced a 4% increase in its dividend.

What is the significance of the Plains acquisition for Keyera?

The acquisition enhances Keyera's scale and service capabilities, vital for sustaining growth and delivering shareholder value.

How much cash flow did Keyera generate in Q2 2025?

Keyera posted a distributable cash flow of $159 million, or $0.69 per share.

When is the earnings conference call scheduled?

The earnings conference call is scheduled for 8:00 a.m. Mountain Time.

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