Enbridge reports adjusted earnings of US$ 492 million for Q1 2014

Q1 2014 financial highlights

• First quarter earnings were US$ 390 million, including the impact of net unrealised non-cash mark-to-market gains and losses.
• First quarter adjusted earnings were US$ 492 million or US$ 0.6 per common share.
• Enbridge Inc. and Enbridge Energy Partners, L.P. announced the Line 3 Replacement Project, an approximate US$ 7 billion mainline investment programme.
• Enbridge Inc. continued to execute its long-term funding plan and raised approximately US$ 2.1 billion since the end of 2013 through debt and preferred equity, as well as increased its enterprise-wide general purpose credit facilities to US $18.1 billion.

"Enbridge performed well in the first quarter of 2014, reflecting solid operating results across our businesses," said Al Monaco, President and Chief Executive Officer. "Adjusted earnings for the first quarter of 2014 were US$ 492 million, or US$ 0.6 per common share. Backed by the successful execution of our organic growth programme, including projects recently placed into service and those expected to be completed over the balance of 2014, we are on track to be within our full year adjusted earnings per share guidance range of US$ 1.84 to US$ 2.04 per share.

New investments

"During the quarter, we added to our portfolio of commercially secured growth projects, reflecting continued demand for safe and reliable energy infrastructure," said Monaco. "In March, we announced the US$ 7 billion Line 3 replacement programme, the largest project in our company's history. This is a very important project for us as it represents a major enhancement of our mainline liquids pipeline system and it comes with significant benefits to our customers. The increased reliability of throughput on our system will provide customers with greater certainty of service to key markets and aligns well with our number one priority of safety and operational reliability."

Investments in the Company's regional oil sands systems and renewable power generation business also added to the company's growth portfolio in the first quarter. In January, Enbridge announced the US$ 0.2 billion Sunday Creek Terminal expansion, which will improve service in the oil sands and contribute to maintaining Enbridge's leading position in the region. Earlier in the same month, Enbridge announced the approximate US$ 0.2 billion investment in the 110 MW Keechi Wind Project (Keechi), located in Jack County, Texas.

"With a commercially secured portfolio of growth projects totalling a record US$ 36 billion, and an additional US$ 5 billion of projects expected to be secured and placed into service by 2017, there is a high degree of transparency that we will deliver average annual earnings per share growth of 10 - 12% to 2017. The secured slate of organically driven projects also provides confidence in our ability to generate industry leading earnings per share growth well beyond 2017," continued Monaco.

Outlook

"In 2014 and 2015, we expect to place into service more than US$ 18 billion of projects to expand capacity and extend market access for our customers," said Monaco. "Since 2008, we've put over 40 projects into service representing about US$ 18 billion of capital. We continue to build on our proven project management expertise, experience in cost estimation, ability to anticipate challenges and solid on-the-ground execution.

"We're also working to enhance and strengthen our relationships with project stakeholders. The National Energy Board's approval in March of the Line 9B Reversal and Line 9B Expansion Project was supported in large part by the extra lengths taken to engage communities along the right of way and to incorporate stakeholder input, which led to further safety enhancements to the project."

Financing the growth plan also remains a top priority and Enbridge continues to bolster funding and liquidity support. Since the end of 2013, Enbridge has issued US$ 275 million in preference shares, approximately US$ 1.8 billion in medium-term notes and increased its entity-wide general purpose credit facilities by approximately US$ 0.5 billion. Included in the total debt offerings, was a US$ 130 million issuance with a 50-year maturity date, which is a rarity in the Canadian debt capital market. Enbridge also issued a US$ 300 million three-year medium-term note at a coupon rate of 1.9%, the lowest ever by a Canadian corporate issuer.

"Our consistent access to debt and equity markets demonstrates the confidence investors have in Enbridge, our ability to execute on our record growth capital programme and the reliability of our business model," Monaco asserted.

Adapted from press release by Rosalie Starling

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