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Gas industry

Northern Border Partners Reports 15% Increase in Earnings

Strategic Insights

— 2 min read

Northern Border Partners, L.P., a leading natural gas pipeline company, has announced a 15% increase in reported earnings per unit for the second quarter of 1998, driven by the return on equity allowed on the company's investments in the construction of the Chicago Project. The Partnership generated net income of $16.4 million for the second quarter of 1998, compared to $12.8 million for the same period in 1997. For the first half of 1998, the Partnership reported earnings per unit of $1.05 compared to $0.98 per unit in the first half of 1997.

The increase in earnings per unit during the first two quarters of 1998 is primarily attributable to the return on equity allowed on the Partnership's investments in the construction of the Chicago Project, an $839 million expansion and extension of the Northern Border Pipeline system. The additional returns allowed more than offset the effects of approximately 3 million new common units issued in late 1997 and early 1998 to fund the Partnership's investment.

Key Takeaways:

  • Northern Border Partners, L.P. reported a 15% increase in earnings per unit for the second quarter of 1998, at $0.55 per unit, compared to $0.48 per unit for the same period in 1997.
  • The Partnership generated net income of $16.4 million for the second quarter of 1998, compared to $12.8 million for the same period in 1997.
  • For the first half of 1998, the Partnership reported earnings per unit of $1.05 compared to $0.98 per unit in the first half of 1997.
  • The increase in earnings per unit during the first two quarters of 1998 is primarily attributable to the return on equity allowed on the Partnership's investments in the construction of the Chicago Project, an $839 million expansion and extension of the Northern Border Pipeline system.
  • The Partnership also announced the declaration of its regular quarterly cash distribution of $0.575 per unit for the second quarter of 1998, payable on August 14, 1998 to unitholders of record as of July 31, 1998.
  • Northern Border Partners, L.P. owns a 70% general partner interest in Northern Border Pipeline Company, which owns a 969-mile U.S. interstate pipeline system that transports approximately 20% of all Canadian natural gas into the U.S.

Statistics:

  • 15% increase in reported earnings per unit for the second quarter of 1998, compared to the same period in 1997.
  • Net income of $16.4 million for the second quarter of 1998, compared to $12.8 million for the same period in 1997.
  • Earnings per unit of $1.05 for the first half of 1998, compared to $0.98 per unit in the first half of 1997.
  • 3 million new common units issued in late 1997 and early 1998 to fund the Partnership's investment.
  • $839 million expansion and extension of the Northern Border Pipeline system.
  • 969-mile U.S. interstate pipeline system owned by Northern Border Pipeline Company.
  • Approximately 20% of all Canadian natural gas transported into the U.S. through Northern Border Pipeline Company.

Sources:

  • Northern Border Partners, L.P.
  • Northern Border Pipeline Company.

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