Cheniere Energy Q3 2024 Earnings Call Report

Date: November 1, 2024
CEO: Jack Fusco

Cheniere Energy (NYSE:LNG) reported strong financial results for its third quarter ending 2024, revealing a consolidated adjusted EBITDA of approximately $1.5 billion and a distributable cash flow of around $820 million. The company recorded a net income of about $900 million. They have raised their full-year guidance for 2024, citing increased production and margins, and maintain a positive outlook on the LNG market, particularly in Asia.

Key Takeaways

• Consolidated adjusted EBITDA: $1.5 billion; Distributable cash flow: $820 million.
• Net income: $900 million, marking eight straight quarters of positive net income.
• Full-year 2024 guidance raised for EBITDA to $6B – $6.3B and distributable cash flow to $3.4B – $3.7B.
• Q3 stock buyback: Nearly $300 million, totaling $2 billion year-to-date.
• Debt reduced by $150 million; capital expenditures of $500 million for Corpus Christi Stage 3 project.
• Stage 3 construction is 68% complete; first gas expected soon, first LNG by year-end.
• Voluntary target to limit methane emissions intensity to 0.03% by 2027.
• Achieved AAA ESG rating from MSCI for climate management improvements.
• Global LNG imports grew 9% year-over-year in September.
• U.S. gas prices remained stable at $1.93.
• Expect 47M to 48M tons of LNG production in 2025, supporting EBITDA.

Company Outlook

• Confidence in increased production and margins reflected in raised 2024 guidance.
• Preparations for Train 1 of Stage 3 project completion by year-end.
• Spot volume availability of 3M tons for CMI in 2025.

Market Analysis

Bearish Highlights

• European LNG imports flat; long-term contracting has slowed.

Bullish Highlights

• Strong Asian demand for LNG; significant growth rates anticipated despite cyclical fluctuations.

Misses

• Consolidated cash decreased to $3 billion from $4.5 billion initially this year.

Q&A Highlights

• Discussions regarding changes in DOE permits favoring brownfield expansions.
• Commitment to accurate emissions measurements amidst clean energy transition emphasis.

InvestingPro Insights

• Market capitalization at $41.16 billion with a P/E ratio of 10.08.
• $15.96 billion revenue over the last twelve months with a gross profit margin of 57.25%.
• 4 consecutive years of dividend increases amidst strong cash flow.

Cheniere Energy's solid Q3 performance and optimistic outlook for 2024 positions them strategically for growth in the LNG market, focusing on operational excellence and environmental stewardship.