LNG exporter Cheniere forecasts 2025 profit below estimates
U.S. liquefied natural gas exporter Cheniere Energy forecast its 2025 core profit largely below Wall Street expectations on Thursday, after reporting a sharp fall in annual earnings and lower LNG revenue due to weaker prices.
The LNG market remained relatively tight in 2024 due to low supply capacity growth, strong demand outside Europe and continued geopolitical tensions.
Despite the favorable market conditions, annual spot prices were overall lower than in 2023.
Cheniere reported a 67% slump in net income, a 30% decline in earnings before interest, taxes, depreciation and amortization while revenue fell 23% in 2024 compared to 2023. It also blamed the results on some unfavorable accounting changes.
The company reported LNG revenue of $14.89 B for the year ended December 31, compared with $19.56 B in 2023.
Cheniere, the largest U.S. LNG exporter, said it is banking on the expected completion of the Corpus Christi expansion project this year to increase supplies of the superchilled gas.
It has the capacity to produce about 45 MMtpy of LNG at Corpus Christi in Texas and Sabine. The company's Corpus Christi Stage 3 liquefaction project is expected to increase the facility's production capacity by > 10 MMtpy.
It produced first LNG from the expansion project in December and its first cargo in February, the company said.
"We expect 2025 to be another record year for LNG production as Stage 3 trains are completed," CEO Jack Fusco said in a statement.
Cheniere expects its adjusted core profit between $6.5 B and $7 B for 2025, the midpoint end of which fell below analysts' average expectation of $6.83 B, according to LSEG data.
TD Cowen analysts said though the forecast fell below estimates, they expect this guidance to increase through the year based on LNG's track record.
Shares of the company were marginally down in early trading.
The United States is trying to increase its LNG exports to help reduce Europe's dependency on Russian gas following Moscow's invasion of Ukraine three years ago.
U.S. President Donald Trump ordered a lifting of the freeze on LNG export approvals the day he came into office for a second time on January 20.
Cheniere has signed several long-term LNG sales agreements with companies including a recent supply deal with Indian Oil Corp.
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