Targa Resources Corp. Reports Mixed Q3 Results with Increased Net Income and Adjusted EBITDA

Targa Resources Corp. (NYSE: TRGP) reported its financial results for the third quarter and nine months ended September 30, 2024, reflecting a mixed performance in revenue and profitability compared to the previous fiscal period. Total revenues for the third quarter were $3,851.8 million, a slight decrease from $3,896.6 million in the same period of 2023. This decline was primarily driven by a drop in commodity sales, which fell to $3,217.0 million from $3,374.3 million, a decrease of approximately 5%. However, fees from midstream services increased significantly to $634.8 million, up from $522.3 million, marking a 22% rise.

Net income for the third quarter surged to $448.1 million, a substantial increase from $279.0 million in the prior year, while net income attributable to Targa Resources Corp. rose to $387.4 million from $220.0 million. This resulted in a basic net income per share of $1.76, compared to $0.97 in the same quarter of 2023. Adjusted EBITDA also saw a notable increase, reaching $1,069.7 million, up from $840.2 million.

For the nine months ended September 30, 2024, total revenues increased to $11,976.2 million from $11,820.8 million, while net income decreased to $1,139.5 million from $1,221.7 million. The decline in net income was attributed to lower commodity prices and unfavorable hedging impacts, despite higher volumes of NGLs and condensate.

Strategically, Targa completed the acquisition of Blackstone Energy Partners’ 25% interest in the Grand Prix Joint Venture in January 2023 for $1.05 billion, which has since allowed the company to own 100% of the venture. In July 2024, Targa entered into an agreement for the Blackcomb Pipeline, expected to transport up to 2.5 Bcf/d of natural gas, with operations anticipated to begin in the second half of 2026. The company also announced several new processing plants in the Permian region, including the East Pembrook and East Driver plants, expected to commence operations in 2026.

Financially, Targa's total assets increased to $21,903.8 million as of September 30, 2024, up from $20,671.8 million at the end of 2023. Long-term debt rose to $13,601.4 million from $12,333.2 million, reflecting increased borrowings to support capital expenditures, which totaled $2,238.9 million for the nine months, significantly higher than $1,665.4 million in the same period of 2023. The company also repurchased shares totaling $646.7 million during the nine months, reflecting its ongoing commitment to return capital to shareholders.