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Pembina Pipeline profits surge on new in-service assets, Veresen acquisition

Pembina Pipeline Corp. on Feb. 22 posted fourth-quarter 2017 adjusted EBITDA of C$674 million, climbing from C$342 million in the comparable period of 2016.

The S&P Global Market Intelligence consensus adjusted EBITDA estimate for the most recent quarter was C$571.8 million.

The Calgary, Alberta-based transportation and midstream service provider booked C$445 million, or 83 cents per share, in fourth-quarter earnings, compared with C$131 million, or 28 cents per share, a year earlier.

Revenue for the quarter was up C$1.72 billion, from C$1.25 billion a year earlier, while adjusted cash flow from operating activities totaled C$499 million, or 99 cents per share, an increase from C$292 million, or 74 cents per share, in the prior-year period.

Total volume for the quarter was 2,917 Mboe/d, an increase from 1,941 Mboe/d in the corresponding quarter of 2016.

The company said its books were positively impacted by C$9.4 billion acquisition of Veresen Inc. and C$4.8 billion worth of new projects that were placed into service during the year. The company secured about C$1.2 billion in new growth projects, which are expected to "further strengthen" its competitive position and support market access solutions for its customers.

In the fourth-quarter midstream volume decreased to 162 MBoe/d, from 164 MBoe/d reported in the same quarter of 2016. Conventional pipelines volume during the most recent quarter increased to 862 MBoe/d from 639 MBoe/d in the comparable quarter of 2016.

On a full-year basis, Pembina Pipeline reported adjusted EBITDA of C$1.71 billion for 2017, beating the S&P Global Market Intelligence consensus adjusted EBITDA estimate of C$1.61 billion. The result compares to 2016 adjusted EBITDA of C$1.19 billion.

Full-year earnings were C$891 million, or C$1.88 per share, up from C$466 million, or C$1.01 per share, in 2016. Revenue for the year climbed to C$5.41 billion, from C$4.27 billion recorded in 2016.

The company posted adjusted cash flow from operating activities of C$1.40 billion, or C$3.27 per share, an increase from C$986 million, or C$2.54 per share, a year ago.

For the full year, total volume increased to 2,300 Mboe/d, an increase from 1,907 Mboe/d in 2016.

Looking ahead, the company said it remains on track to achieve its 2018 adjusted EBITDA guidance of C$2.55 billion to C$2.75 billion.

"[W]ith all the success that 2017 brought and the positive momentum we have seen so far in 2018, we are well positioned for what should be another exciting and active year ahead. Our ongoing efforts will continue to focus around building out our value-chain to provide our customers with premium market access for energy products derived from western Canadian hydrocarbons," Pembina Pipeline said in its earnings release.