The APA Group (ASX: APA) share price has slipped into the red on Wednesday after the company posted its FY24 results.
APA shares opened strong but have since dropped 1.45% lower to $7.83 at the time of writing as investors process the update.
Meanwhile, the S&P/ASX 200 index (ASX: XJO) is now down 0.57%.
Let's see what the energy infrastructure company posted.
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APA share price slips despite solid FY24 results
Key highlights of APA's annual numbers include:
- Total statutory revenue climbed 7.9% year over year to $2.59 billion (this excludes pass-through revenue).
- Earnings before interest, tax, depreciation and amortisation (EBITDA) of $1.89 billion a 9.7% increase on FY23.
- Statutory net profit reached $998 million, up from $287 million last year.
- FY24 distribution of 56 cents per security, a 1.8% increase from FY23.
- Capital investment in growth projects totalled $833 million.
What else happened in FY24?
The APA share price had a choppy year in FY24. But on the business side, it made a number of efforts to expand its energy infrastructure portfolio and produce growth.
For instance, its Pilbara Energy acquisition "has performed in line with its acquisition business case", contributing eight months of revenue for the business in FY24.
APA also secured new agreements, including a 20-year gas transport agreement with Senex Energy and a development agreement for the Brigalow gas pipeline in Queensland.
As a result of these factors, sales revenues were up 8% year over year (excluding pass-through revenues), driving EBITDA growth of approximately 10%.
It also recognised a $879 million remeasurement of the 88% interest it holds in the Goldfields gas pipeline (GGP), which was required under accounting rules.
Meanwhile, it threw off $1.07 billion in free cash flow after all capital expenditures, in line with the previous year.
This prompted the Board to declare a 2% dividend growth to 56 cents per share for the year. This could impact the APA share price.
What did management say?
APA CEO and managing director Adam Watson expressed confidence in the company's strategic direction:
APA has delivered another solid financial and operating result in FY24, with revenue, earnings and distribution growth, the completion of key projects and ongoing execution of our growth strategy.
"Over the last year we have successfully integrated the Pilbara Energy business and progressed key projects in the region, including the Port Hedland Solar and Battery Project which is nearing completion.We've also executed a number of new agreements including an agreement to design and develop twin pipelines for CS Energy's Brigalow gas peaking plant in Queensland, as well as a 20-year gas transport agreement with Senex Energy which is expected to support much needed additional gas supply into the east coast gas market from the end of 2025.
What's next?
Looking ahead to FY25, APA has provided guidance for a distribution of 57 cents per security, up 1.8 percent from the previous financial year.
The company also expects underlying EBITDA to range between $1.9 – $2 billion.
APA's guidance on distributions growth balances the need to also fund APA's organic growth pipeline, while maintaining our investment grade credit ratings.
APA share price snapshot
The APA share price has slipped into the red today despite posting a strong set of FY24 numbers and a positive outlook. Shares in the company are down 8.3% year to date and more than 12% lower over the past 12 months.
