• Consolidated Adjusted EBITDA: Approximately $1.5 billion for Q3 2024.
• Distributable Cash Flow: Approximately $820 million for Q3 2024.
• Net Income: Approximately $900 million for Q3 2024.
• Stock Repurchase: Nearly $300 million repurchased in Q3 2024, totaling approximately $2 billion year-to-date.
• Debt Repayment: $150 million paid down at Sabine Pass in Q3 2024.
• Capital Expenditure: Approximately $500 million funded, mainly related to Stage 3.
• Dividend Increase: 15% increase to $2 per share annualized in Q3 2024.
• LNG Cargoes Exported: 158 LNG cargoes exported in Q3 2024.
• 2024 Guidance: Increased to $6 billion to $6.3 billion in consolidated adjusted EBITDA and $3.4 billion to $3.7 billion of distributable cash flow.
• Stage 3 Project Completion: Approximately 68% complete as of September 30, 2024.
• Share Repurchase Authorization: Completed $4 billion authorization, starting on an additional $4 billion authorization through 2027.
• 2025 LNG Production Forecast: 47 million to 48 million tons expected, inclusive of Stage 3 volumes.

• Warning! GuruFocus has detected 7 Warning Sign with CQP.

Release Date: October 31, 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) reported strong financial results for the third quarter of 2024, with a consolidated adjusted EBITDA of approximately $1.5 billion and net income of approximately $900 million.
• The company increased its full-year 2024 guidance, expecting consolidated adjusted EBITDA between $6 billion and $6.3 billion, driven by better-than-expected production and portfolio optimization activities.
• Cheniere Energy Partners LP (NYSE:CQP) achieved significant operational milestones, including the production and export of the 1,000th LNG cargo from Corpus Christi and continued progress on the Corpus Christi Stage 3 project, which is ahead of schedule.
• The company increased its third-quarter dividend by 15% to $2 per share annualized, reflecting its commitment to returning value to shareholders.
• Cheniere Energy Partners LP (NYSE:CQP) has been recognized for its environmental stewardship, setting a voluntary Scope 1 methane emissions intensity target and receiving an AAA ESG rating from MSCI.

Negative Points

• The LNG market remains precariously balanced, with geopolitical tensions and potential supply disruptions posing risks to market stability.
• Cheniere Energy Partners LP (NYSE:CQP) faces uncertainty regarding the timing and extent of commissioning processes for new trains, which could impact financial results in 2025.
• The company anticipates major maintenance at Sabine Pass in 2025, which could affect production levels.
• There is a potential impact on distributable cash flow due to changes in the tax code, particularly related to the alternative minimum tax and unrealized derivatives.
• The market for long-term LNG contracts has slowed, with fewer transactions being executed, which could impact future growth opportunities.

Q & A Highlights

Q: Can you provide details on the commissioning process and its impact on costs? A: Zach Davis, CFO, explained that the guidance includes 47 to 48 million tons of total production, with around 1 million tons for commissioning. These volumes will offset CapEx, with margins from a mix of spot and contracted volumes. This could result in hundreds of millions of dollars to help fund the project.

Q: How does the FTA authorization impact SPL expansion discussions with customers? A: Anatol Feygin, EVP and Chief Commercial Officer, stated that they have about 10 million tonnes contracted and are optimizing the project for the best balance of economics and contractual support. They aim for a 90% contracted rate with a 7x CapEx to EBITDA target.

Q: How have delays in competing US Gulf Coast projects affected your commercial discussions? A: Jack Fusco, CEO, noted that their strong relationship with Bechtel and reliable operations have made commercial discussions easier. Anatol Feygin added that their scientific approach to emissions and reliability in project delivery are key components in these discussions.

Q: What are your expectations for European LNG demand in the medium term? A: Anatol Feygin mentioned that European demand is stabilizing, with infrastructure no longer a constraint. They expect demand to remain stable through the mid-2030s, around 120 to 130 million tonnes annually.

Q: How do you view the current LNG shipping market and potential opportunities? A: Anatol Feygin highlighted that Cheniere is a major player in LNG shipping, optimizing their portfolio by chartering vessels in and out. Current low day rates provide opportunities as they prepare for Stage 3 production.

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