Plains All American Pipeline and Plains GP Holdings Announce Quarterly Distributions and Timing of First-Quarter 2024 Earnings
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Insights
The announcement by Plains All American Pipeline, L.P. (PAA) and Plains GP Holdings (PAGP) regarding their quarterly distributions indicates a steady state of financial disbursements, maintaining the same distribution levels as the previous quarter. This consistency suggests a stable financial position, which could reassure investors looking for predictable income streams, particularly those interested in the energy infrastructure sector.
However, the fact that distributions have not increased could imply a cautious approach by management, possibly due to current market conditions or internal cash flow considerations. It's worth noting the nuances of the distributions, such as the non-taxable nature of the PAGP cash distribution to the extent of a shareholder's tax basis, which can be an attractive aspect for tax-sensitive investors.
From a financial perspective, the unchanged distribution could be interpreted in different ways. On one hand, it could be a sign of disciplined capital management, ensuring that the company does not overextend itself. On the other hand, it may raise questions about the company's growth prospects and ability to increase shareholder value over time. Investors would do well to review the upcoming earnings report for insights into the company's operational performance and strategic direction.
Regarding the tax implications of the distributions, PAA and PAGP have provided important information for equity holders. The classification of PAGP's cash distribution as a potential non-taxable return of capital, to the extent of a shareholder's tax basis, is a critical piece of information for tax planning. This can affect the after-tax return on investment, making it a significant factor in investment decisions for individuals and entities with large holdings.
Moreover, the potential for distributions to be taxable as capital gains beyond the tax basis indicates a need for shareholders to maintain accurate records of their investment's tax basis. The mention of Qualified Notices under Treasury Regulation Section 1.1446 for the PAA Common Unit distribution and PAA Series B Preferred Unit distribution also highlights the need for compliance with tax regulations, particularly for foreign investors subject to withholding tax obligations.
Investors should be proactive in understanding these tax considerations, as they can have a substantial impact on the net income derived from their investments. Engaging with a tax professional to navigate these aspects is advisable, especially given the complexities of tax law as it relates to investment income and capital gains.
HOUSTON, April 04, 2024 (GLOBE NEWSWIRE) -- Plains All American Pipeline, L.P. (Nasdaq: PAA) and Plains GP Holdings (Nasdaq: PAGP) today announced their quarterly distributions with respect to the first quarter of 2024 and also announced timing of first quarter 2024 earnings.
First Quarter Distribution Declaration
PAA and PAGP announced the following quarterly cash distributions, each of which will be payable on May 15, 2024 to holders of the respective securities at the close of business on May 1, 2024:
- PAA Common Units –
$0.31 75 per Common Unit ($1.27 per unit on an annualized basis), which is unchanged from the distribution paid in February 2024. - PAGP Class A Shares –
$0.31 75 per Class A Share ($1.27 per Class A Share on an annualized basis), which is unchanged from the distribution paid in February 2024. - PAA Series A Preferred Units –
$0.61 524 per Series A Preferred Unit (approximately$2.46 per unit on an annualized basis). - Series B Preferred Units -
$24.20 per Series B Preferred Unit (based on the applicable quarterly floating rate).
Although equity holders should consult their own tax advisor regarding their particular circumstances, the PAGP cash distribution per Class A Share is expected to be a non-taxable return of capital to the extent of a Class A Shareholder’s tax basis in each PAGP Class A Share and a reduction in such tax basis. In addition, to the extent any cash distribution exceeds a Class A Shareholder’s tax basis, it should be taxable as a capital gain. Qualified Notices under Treasury Regulation Section 1.1446 with respect to the PAA Common Unit distribution and PAA Series B Preferred Unit distribution will be posted on the Plains website under “Investor Relations – Tax Information.”
First Quarter 2024 Earnings Timing
PAA and PAGP also announced that they will release first-quarter 2024 earnings before market open on Friday, May 3, 2024. Following the announcement, PAA and PAGP will host a conference call at 9:00 a.m. CT (10 a.m. ET) with analysts and investors to discuss earnings. The call will be webcast live on the internet and may be accessed through the "Investors Relations” section of the website at www.plains.com. An audio replay will be available on the website after the call.
PAA is a publicly traded master limited partnership that owns and operates midstream energy infrastructure and provides logistics services for crude oil and natural gas liquids (NGL). PAA owns an extensive network of pipeline gathering and transportation systems, in addition to terminalling, storage, processing, fractionation and other infrastructure assets serving key producing basins, transportation corridors and major market hubs and export outlets in the United States and Canada. On average, PAA handles approximately 8 million barrels per day of crude oil and NGL.
PAGP is a publicly traded entity that owns an indirect, non-economic controlling general partner interest in PAA and an indirect limited partner interest in PAA, one of the largest energy infrastructure and logistics companies in North America.
PAA and PAGP are headquartered in Houston, Texas. More information is available at www.plains.com.
Investor Relations Contacts:
Blake Fernandez
Michael Gladstein
(866) 809-1291
FAQ
What are the quarterly cash distributions announced by Plains All American Pipeline, L.P. (PAA) and Plains GP Holdings (PAGP) for the first quarter of 2024?
When will the quarterly cash distributions be payable to holders of the respective securities?
What is the timing of the first-quarter 2024 earnings release for Plains All American Pipeline, L.P. (PAA) and Plains GP Holdings (PAGP)?
Where can investors access the webcast of the conference call to discuss earnings for Plains All American Pipeline, L.P. (PAA) and Plains GP Holdings (PAGP)?
