South Bow Corp Q2 2025 Financial Review: Growth and Dividends
South Bow Corp Reports Strong Second Quarter 2025 Results
CALGARY, Alberta - South Bow Corp. (TSX, NYSE: SOBO) is proud to present its financial and operational results for the second quarter of 2025. All figures are in U.S. dollars unless stated otherwise.
Key Highlights from Q2 2025
Safety and Operational Performance
- Average throughput reached 544,000 barrels per day (bbl/d) on the Keystone Pipeline, and 760,000 bbl/d on the U.S. Gulf Coast segment.
- South Bow has met its commitment of 585,000 bbl/d on the Keystone Pipeline.
- Progress on the Blackrod Connection Project includes the completion of a 150,000-barrel crude oil storage tank.
- Cleanup efforts from the Milepost 171 incident were concluded, ahead of schedule, with significant integrity checks undertaken.
Financial Performance
In Q2 2025, South Bow generated revenue of $524 million and net income of $96 million, translating to $0.46 per share. The normalized EBITDA stood at $250 million, reflecting a decrease primarily due to lower marketing contributions, while the distributable cash flow reached $167 million.
Stability in Financial Metrics
- Long-term debt remained stable at $5.8 billion, with net debt recorded at $4.9 billion.
- The net debt-to-normalized EBITDA ratio was 4.6 times, maintaining a solid financial position.
Shareholder Returns
South Bow declared dividends totaling $104 million, equating to $0.50 per share, during the second quarter. Approval for quarterly dividends was granted by the board, to be paid on a specified date in October 2025.
Operational Enhancements
- Implementation of a new enterprise resource planning system commenced, aligned with internal process improvement for future growth.
- Investment in supervisory control and data acquisition (SCADA) systems is targeted for rollout this year.
Milepost 171 Incident Overview
The recent incident at Milepost 171, which occurred in April, received thorough attention. Cleanup efforts were completed, estimated costs covered largely by insurance, and continued integrity checks ensured safety and reliability.
Market Outlook and Guidance for 2025
Looking ahead, the company anticipates a dynamic market influenced by fluctuating oil demands and global trade challenges. The current guidance indicates adjusted expectations for EBITDA and cash flows amidst changing industry conditions.
2025 Financial Guidance
- Normalized EBITDA guidance for 2025 is projected at around $1.01 billion, subject to market variations.
- Interest expenses and expected capital expenditures are aligned with financial strategies to sustain growth.
Conclusion
South Bow Corp. continues demonstrating strength in its operational and financial strategies, marked by robust throughput, prudent capital allocation, and commitment to shareholder returns through dividends.
Frequently Asked Questions
1. What were the major financial highlights for South Bow Corp in Q2 2025?
In Q2 2025, South Bow reported $524 million in revenue and $96 million in net income, maintaining strong operational performance amidst market challenges.
2. How has South Bow addressed the Milepost 171 incident?
Cleanup at the Milepost 171 site has been successfully completed, with ongoing integrity checks ensuring safe operations post-incident.
3. What is the significance of the declared dividends?
Declared dividends amounting to $104 million reflect South Bow's commitment to returning value to shareholders while maintaining financial stability.
4. What are the company's growth expectations for 2025?
South Bow anticipates normalized EBITDA of around $1.01 billion for 2025, underpinned by contracted cash flows despite external market fluctuations.
5. Where can investors find more information about South Bow?
Investors can visit South Bow's official website and their SEDAR+ profile for detailed financial information and operational updates.
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