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DCP Midstream (DCP) Stock Slips 4.8% Since Q3 Earnings Miss
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DCP Midstream, LP declined 4.8% since the third-quarter 2021 earnings announcement on Nov 2. The lower-than-expected results were owing to a decline in NGL pipelines throughput volumes. The negatives were partially offset by increased wellhead volumes in the North.
The partnership reported third-quarter adjusted earnings of 18 cents per unit, missing the Zacks Consensus Estimate of earnings of 70 cents. The bottom line also declined from the year-ago profit of 46 cents per unit.
Total quarterly revenues of $2,827 million missed the Zacks Consensus Estimate of $4,804 million. However, the top line increased from $1,586 million in the year-ago quarter.
DCP Midstream Partners, LP Price, Consensus and EPS Surprise
The segment recorded adjusted EBITDA of $184 million for the third quarter, down from the year-ago period’s $216 million. Lower NGL pipelines throughput volumes affected the segment. The negatives were partially offset by higher Southern Hills and Front Range volumes.
The average NGL pipelines throughput for the quarter was 668 thousand barrels per day (Mbpd), lower than the year-ago level of 680 Mbpd. Fractionator throughputs were recorded at 58 Mbpd, in line with the year-ago level.
Gathering and Processing
The segment reported adjusted EBITDA of $227 million for the third quarter, up from $176 million a year ago. Increased wellhead volumes in the North and favorable commodity prices aided the segment. The positives were partially offset by lower South region volumes.
Average natural gas wellhead volumes for the quarter declined to 4,221 million cubic feet per day (MMcf/d) from the year-ago period’s 4,364 MMcf/d. NGL gross production totaled 406 Mbpd, unchanged from the year-ago quarter’s level.
Total Expenses
Purchases and related costs significantly increased year over year for the quarter under review. Operating and maintenance expenses rose to $168 million from $146 million in the third quarter of 2020.
Total operating costs and expenses for the third quarter were $2,833 million, up from the year-ago figure of $1,526 million.
Financials
For third-quarter 2021, total expansion capital expenditure and equity investments were $12 million. Sustaining capital for the quarter was $17 million. It generated an excess free cash flow of $157 million in the third quarter.
At the end of third-quarter 2021, the partnership reported long-term debt of $5,325 million. Cash and cash equivalents were $3 million. It had current debt of $355 million, reflecting a debt to capitalization of 50.2%.
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Based on the third-quarter results and a strong performance in the first half of the year, the partnership expects to deliver the high end of its financial guidance for 2021.
By 2030, the partnership is planning to lower its Scope 1 and 2 greenhouse gas emissions by 30%. Moreover, it expects to achieve net-zero emissions by 2050.
Zacks Rank & Stocks to Consider
The partnership currently has a Zacks Rank #3 (Hold).
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DCP Midstream (DCP) Stock Slips 4.8% Since Q3 Earnings Miss
DCP Midstream, LP declined 4.8% since the third-quarter 2021 earnings announcement on Nov 2. The lower-than-expected results were owing to a decline in NGL pipelines throughput volumes. The negatives were partially offset by increased wellhead volumes in the North.
The partnership reported third-quarter adjusted earnings of 18 cents per unit, missing the Zacks Consensus Estimate of earnings of 70 cents. The bottom line also declined from the year-ago profit of 46 cents per unit.
Total quarterly revenues of $2,827 million missed the Zacks Consensus Estimate of $4,804 million. However, the top line increased from $1,586 million in the year-ago quarter.
DCP Midstream Partners, LP Price, Consensus and EPS Surprise
DCP Midstream Partners, LP price-consensus-eps-surprise-chart | DCP Midstream Partners, LP Quote
Operations
Logistics and Marketing
The segment recorded adjusted EBITDA of $184 million for the third quarter, down from the year-ago period’s $216 million. Lower NGL pipelines throughput volumes affected the segment. The negatives were partially offset by higher Southern Hills and Front Range volumes.
The average NGL pipelines throughput for the quarter was 668 thousand barrels per day (Mbpd), lower than the year-ago level of 680 Mbpd. Fractionator throughputs were recorded at 58 Mbpd, in line with the year-ago level.
Gathering and Processing
The segment reported adjusted EBITDA of $227 million for the third quarter, up from $176 million a year ago. Increased wellhead volumes in the North and favorable commodity prices aided the segment. The positives were partially offset by lower South region volumes.
Average natural gas wellhead volumes for the quarter declined to 4,221 million cubic feet per day (MMcf/d) from the year-ago period’s 4,364 MMcf/d. NGL gross production totaled 406 Mbpd, unchanged from the year-ago quarter’s level.
Total Expenses
Purchases and related costs significantly increased year over year for the quarter under review. Operating and maintenance expenses rose to $168 million from $146 million in the third quarter of 2020.
Total operating costs and expenses for the third quarter were $2,833 million, up from the year-ago figure of $1,526 million.
Financials
For third-quarter 2021, total expansion capital expenditure and equity investments were $12 million. Sustaining capital for the quarter was $17 million. It generated an excess free cash flow of $157 million in the third quarter.
At the end of third-quarter 2021, the partnership reported long-term debt of $5,325 million. Cash and cash equivalents were $3 million. It had current debt of $355 million, reflecting a debt to capitalization of 50.2%.
View
Based on the third-quarter results and a strong performance in the first half of the year, the partnership expects to deliver the high end of its financial guidance for 2021.
By 2030, the partnership is planning to lower its Scope 1 and 2 greenhouse gas emissions by 30%. Moreover, it expects to achieve net-zero emissions by 2050.
Zacks Rank & Stocks to Consider
The partnership currently has a Zacks Rank #3 (Hold).
Some better-ranked players in the energy space are Diamondback Energy (FANG - Free Report) , APA Corporation (APA - Free Report) and Earthstone Energy . All companies sport a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Diamondback’s earnings for 2021 are expected to surge 60.9% year over year.
APA’s earnings for 2021 are expected to increase 25.5% year over year.
Earthstone’s earnings for 2021 are expected to grow 92.1% year over year.