Enbridge Beats Profit Estimates

Enbridge Inc has reported CAD 2.13 billion ($1.56 billion) in net income adjusted for nonrecurring items for the first quarter, down from CAD 2.24 billion for the same three-month period last year due to lower earnings from liquids pipelines.

Nonetheless adjusted earnings per share of CAD 0.98 ($0.71) beat the Zacks Consensus Estimate of $0.69. Enbridge earlier increased its quarterly dividend by 3 percent to CAD 0.97 for 2026.

Net income before adjustment was CAD 1.67 billion, down from CAD 2.26 billion for Q1 2205.

Liquids pipelines delivered CAD 2.3 billion in adjusted EBITDA, down from CAD 2.62 billion for Q1 2025 partly due to "lower Mainline and Market Access System contributions as a result of higher earnings sharing, lower Mainline tolls on Line 9 deliveries, and lower contributions from FSP [Flanagan South Pipeline]", Calgary, Canada-based Enbridge said in its quarterly statement. An unfavorable exchange rate also weighed down on liquids segment earnings.

Gas transmission adjusted EBITDA rose to CAD 1.52 billion for Q1 2026 from CAD 1.44 billion for Q1 2025. Enbridge attributed the increase to "favorable contracting on our U.S. Gas Transmission assets; and higher revenues at Aitken Creek and BC Pipeline due to higher seasonal spreads and tolls, respectively; partially offset by the unfavorable effect of translating U.S. dollar earnings at a lower average exchange rate in 2026, compared to the same period in 2025".

Adjusted EBITDA from gas distribution and storage climbed to CAD 1.71 billion from CAD 1.6 billion. Enbridge cited "higher distribution margin from rate escalators at Enbridge Gas Ontario; higher Ontario unregulated natural gas storage revenues due to optimization and pricing; and higher base rates for Enbridge Gas Utah and Enbridge Gas North Carolina as a result of recent rate case settlements".

Total adjusted EBITDA stood at CAD 5.81 billion, compared to CAD 5.83 billion for Q1 2025. Operating activities generated CAD 2.34 billion in cash, down from CAD 3.1 billion for Q1 2025.

President and chief executive Greg Ebel said, "The past several months have presented some of the most volatile and complex conditions the global energy sector has faced in decades. Commodity price fluctuations, rapidly shifting geopolitical dynamics, and unprecedented supply disruptions have significantly impacted the energy landscape".

"Mainline volumes averaged 3.2 million barrels per day and the system has been apportioned all year, highlighting sustained supply and demand from our upstream and downstream partners", Ebel added.

"In April, we amended presidential permits for a series of pipelines, providing additional operational flexibility and supporting future expansions. We also launched open seasons on the Flanagan South and Southern Access pipelines to support Mainline Optimization Phase 2, advancing an additional 250 kbpd [thousand barrels per day] of egress capacity from Canada.

"Across our Gas Transmission business, we are advancing high-quality growth projects, including a 25 Bcf [billion cubic feet] expansion to the Tres Palacios storage facility to offer supply optionality to customers and serve demand needs from the significant growth in LNG and power generation facilities entering service across the Gulf. In the Midwest, we sanctioned an expansion to the Vector Pipeline, adding 400 MMcf/d [million cubic feet per day] of westbound capacity to meet growing utility demand. Lastly, in British Columbia we received federal approval for the $4 billion T-South Sunrise Expansion, and the liquefaction module was delivered to the Woodfibre LNG site, marking an important milestone for the facility.

"Our Gas Distribution and Storage business continues to be a steady area of growth, driven by our U.S. utilities with an expected 8-percent-plus rate base compound annual growth rate through the decade. New rates are in effect for Enbridge Gas Utah and North Carolina, and a new rate case in Ohio is in progress. In Ontario, we are adding 8 Bcf of unregulated natural gas storage at the Dawn Hub to strengthen system flexibility in the region and serve rising power generation demand needs.

"Lastly, in our Power segment we sanctioned the 300 MW [megawatts] Cone onshore wind project in Texas supporting Meta. This brings our partnership with Meta to over 1 GW [gigawatts] of combined power generation, and we see meaningful opportunities to further deepen this relationship over time".

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