10.29
Pembina’s Q3/09 ACFFO/unit was $0.42 compared to RBC CM’ estimate of $0.43 and $0.38 in Q3/08. Modestly better-than-expected results from the Midstream segment were largely offset by slightly higher G&A and interest expense. The Cutbank Complex, which was acquired in June 2009, contributed a full quarter to results (about $10 million in margin). Subsequent to Q3/09, the facility exited an initially 30-day planned outage earlier than scheduled and management expects only a minimal impact on revenue. Management reiterated that the fund remains well positioned to maintain the current $1.56/unit distribution through 2013despite becoming a taxable entity in 2011. Pembina plans to convert to a corporation in late 2010 and expects to distribute $1.56/unit annually to shareholders as a dividend after the new structure is in place. The company issued $267 million of 10-year senior unsecured notes at a 5.91% interest rate to a group of private investors. The net proceeds will be used to repay bank debt and for general corporate purposes, which could include helping finance the planned Nipisi and Mitsue pipeline projects.
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