• Consolidated Adjusted EBITDA: Approximately $1.3 billion for Q2 2024.
• Distributable Cash Flow: Approximately $700 million for Q2 2024.
• Net Income: Approximately $880 million for Q2 2024.
• LNG Cargoes Exported: 155 cargoes in Q2 2024.
• Full Year 2024 Guidance: Increased to $5.7 billion to $6.1 billion in consolidated adjusted EBITDA and $3.1 billion to $3.5 billion of distributable cash flow.
• Share Repurchase Authorization: Increased by $4 billion through 2027.
• Dividend Increase: Planned increase to $2 per share annualized next quarter.
• Stage 3 Project Completion: Over 62% completion as of June 2024.
• CapEx on Stage 3: Approximately $400 million in Q2 2024, with total unlevered spend at approximately $3.8 billion.
• Debt Management: Issued $1.2 billion of 5.75% senior notes and redeemed $1.2 billion of 5.625% senior secured notes.

• Warning! GuruFocus has detected 5 Warning Signs with MOGO.

Release Date: August 08, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Cheniere Energy Partners LP (NYSE:CQP) exceeded expectations in Q2 2024, generating $1.3 billion in consolidated adjusted EBITDA and $880 million in net income.
• The company announced a new long-term SPA with Galp, a Portuguese energy company, for approximately 0.5 million tonnes over 20 years, enhancing its European market presence.
• Cheniere Energy Partners LP (NYSE:CQP) increased its 2024 guidance, projecting $5.7 billion to $6.1 billion in consolidated adjusted EBITDA and $3.1 billion to $3.5 billion in distributable cash flow.
• The company successfully executed major maintenance programs at Sabine Pass and Corpus Christi, reinforcing its operational excellence and reliability.
• Cheniere Energy Partners LP (NYSE:CQP) announced a $4 billion increase in its share repurchase authorization through 2027 and plans to increase its dividend to $2 per share annualized next quarter.

Negative Points

• The company faces potential risks from hurricane season, which could impact production and financial results.
• Cheniere Energy Partners LP (NYSE:CQP) is still subject to regulatory and permitting challenges, particularly for its expansion projects.
• The LNG market remains supply-constrained, with limited incremental supply growth expected until 2026.
• The company's financial results could be affected by changes in the tax code, specifically regarding the corporate alternative minimum tax.
• Cheniere Energy Partners LP (NYSE:CQP) has not yet forecasted contributions from Stage 3 volumes for 2024, indicating potential delays in realizing additional revenue.

Q & A Highlights

Q: With the progress made year-to-date, can you provide additional color on the drivers underlying the low versus high end of the updated guidance range? A: Zach Davis, CFO, explained that they are comfortably in the middle of the range, if not better, due to an incremental $100 million added to EBITDA from increased production post-maintenance at Corpus Christi and optimization activities. Variability remains due to potential optimization in the second half, Henry Hub price changes, and weather impacts like hurricanes.

Q: What is your updated view on the regulatory and permitting landscape, especially in light of recent decisions affecting competitor projects? A: Jack Fusco, CEO, stated that Cheniere's permits for SPL Trains 1-6 and CCL 1-3 are no longer subject to appeal. For expansion projects, Cheniere dedicates significant resources to ensure compliance with regulatory requirements, maintaining confidence in their permitting process.

Q: How are commercial discussions progressing, particularly for the SPL expansion, given changes in the LNG market and competitor delays? A: Anatol Feygin, Director, noted that while there is no rush from European long-term counterparties, Asian demand growth and North American production growth continue to drive discussions. Cheniere's reliability and commercial behavior are appreciated by potential customers.

Q: Can you discuss the strategic rationale for potentially adding gas power plant capacity with Calpine under the Texas loan program? A: Jack Fusco, CEO, explained that the increased electricity demand from Stage 3 at Corpus Christi necessitates managing power risk. Partnering with Calpine to enhance a nearby power plant provides a financial hedge against power exposure.

Q: Regarding CCL Stage 3, can you define what "first LNG" means in terms of volume? A: Jack Fusco, CEO, emphasized that Cheniere is committed to genuine business operations, and when they announce first LNG, it will signify substantial production, not just minimal volumes.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.