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TC PipeLines (TCP) Q4 Earnings & Sales Fall Y/Y on High CapEx

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TC PipeLines (TCP - Free Report) witnessed unpleasant earnings in fourth-quarter 2019. The firm reported earnings of 95 cents a unit, down 10.4% from $1.06 cents in the year-ago quarter due to higher maintenance capital expenditures along with lower revenues resulting from the termination of the Bison contracts.

Also, quarterly transmission revenues of $104 million compared unfavorably with $220 million recorded in fourth-quarter 2018 amid lower rates of many of its pipelines induced by the 2018 FERC actions.

Distribution & Cash Flow

TC PipeLines announced fourth-quarter cash distribution of 65 cents per unit, in line with the year-ago figure. Notably, this marks the 83rd quarterly distribution by the partnership.

The partnership's distributable cash flow decreased to $76 million in the quarter under review from $95 million in the year-ago period due to higher system utilization resulting in increased maintenance and operating expenses.

TC PipeLines, LP Price, Consensus and EPS Surprise

TC PipeLines, LP Price, Consensus and EPS Surprise

TC PipeLines, LP price-consensus-eps-surprise-chart | TC PipeLines, LP Quote

In the reported quarter, TC PipeLines distributed $47 million in cash, flat with the year-ago period.

Pipeline Systems' Performance

Great Lakes:  Earnings of $14 million generated from equity investment were in line with the prior-year quarter’s figure.

Northern Border Pipeline: Equity earnings totaled $19 million, in line with the prior-year level.

Iroquois: Equity earnings amounted to $12 million, above the prior-year figure of $11 million.


Operation and maintenance expenses were $20 million in the quarter, above the year-earlier period’s $19 million. General/administrative expenses totaled $2 million, unchanged from the year-ago number. Property taxes came in at $7 million, same as the year-ago level. Depreciation costs declined to $20 million from $24 million a year ago. Financial and other charges also decreased to $20 million from $22 million in the corresponding period of 2018.

Balance Sheet

As of Dec 31, TC PipeLines’ cash and cash equivalents summed $83 million. The partnership had a long-term debt of $1,880 million, representing a debt-to-capital ratio of 71.2%.

Zacks Rank & Other Key Picks

TC Pipelines sports a Zacks Rank #1 (Strong Buy). Some other top-ranked players in the energy space are Contango Oil & Gas Company , Noble Energy Inc. (NBL - Free Report) and Earthstone Energy, Inc. (ESTE - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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