Kinder Morgan Energy Partners LP Earnings: Here’s Why Investors are Not Happy Now

Kinder Morgan Energy Partners LP (NYSE:KMP) delivered a profit and beat Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are down 0.83%.

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Kinder Morgan Energy Partners LP Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 59.02% to $0.97 in the quarter versus EPS of $0.61 in the year-earlier quarter.

Revenue: Rose 43.99% to $2.66 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Kinder Morgan Energy Partners LP reported adjusted EPS income of $0.97 per share. By that measure, the company beat the mean analyst estimate of $0.68. It beat the average revenue estimate of $2.46 billion.

Quoting Management: Chairman and CEO Richard D. Kinder said, KMP had a strong first quarter as our stable and diversified assets continued to grow and produce incremental cash flow. Our five business segments produced approximately $1.276 billion in segment earnings before DD&A and certain items, a 24 percent increase over the first quarter of 2012. KMP also produced cash in excess of our first quarter distribution of approximately $62 million. Growth was spearheaded by contributions from the drop downs of Tennessee Gas Pipeline (NYSE:TGP) and El Paso Natural Gas (EPNG), record export coal volumes in our Terminals business, strong oil and record NGL production at SACROC in our CO2 segment, and good results in our Products Pipelines business. Looking forward, we see exceptional growth opportunities across all of our business segments, as there is a need to build additional midstream infrastructure to move or store oil, gas and liquids from the prolific shale plays in the United States and the oilsands in Alberta, along with increasing demand for export coal and CO2. We currently have identified more than $11 billion in expansion and joint venture investments at KMP and we are pursuing customer commitments for many more projects. Additionally, we expect to close the Copano acquisition in early May, and we look forward to adding Copanos strategic gathering and processing assets and talented employees to the KMP team.

Key Stats (on next page)…

Revenue increased 6.02% from $2.51 billion in the previous quarter. EPS increased 29.33% from $0.75 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.58 to a profit $0.61. For the current year, the average estimate has moved up from a profit of $2.53 to a profit of $2.58 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at]