Kinder Morgan (KMP, KMR, KMI) reported Q1 2011 results last night after market close. Here is the summary from the press release .

Kinder Morgan Energy Partners Increases Quarterly Distribution to $1.14 Per Unit

Distribution 7% Higher Than First Quarter 2010
HOUSTON, Apr 20, 2011 (BUSINESS WIRE) — Kinder Morgan Energy Partners, L.P. (NYSE: KMP) today increased its quarterly cash distribution per common unit to $1.14 ($4.56 annualized) payable on May 13, 2011, to unitholders of record as of April 29, 2011. The distribution represents a 7 percent increase over the first quarter 2010 cash distribution per unit of $1.07 ($4.28 annualized). KMP has increased the distribution 40 times since current management took over in February of 1997.

KMP reported first quarter distributable cash flow before certain items of $382.2 million, up 8 percent from $353.7 million for the comparable period in 2010. Distributable cash flow per unit before certain items was $1.21 compared to $1.18 for the first quarter last year. First quarter net income before certain items was $423.5 million versus $383.1 million for the same period in 2010. Including certain items, net income was $340.9 million compared to $227.4 million for the first quarter of 2010. Certain items totaled a net loss of $82.6 million versus $155.7 million for the same period last year. Virtually all of the $82.6 million was attributable to an accounting entry for a one-time bonus payment to non-senior management employees that KMP and its unitholders are not responsible for and will never pay any portion of. The amount must be reflected on KMP’s income statement, however, for GAAP purposes.

Chairman and CEO Richard D. Kinder said, “We are pleased to increase our cash distribution per unit for the fifth consecutive quarter. All five of our businesses produced stronger first quarter results than in the comparable period last year. Total segment earnings before DD&A were $879.4 million, up 6 percent from $826.9 million for the first quarter of 2010. Given our solid asset performance, along with current oil prices and interest rates, we are on pace to generate excess cash flow of almost $100 million for 2011, versus our annual budget of $37 million. We previously announced that KMP is expected to declare cash distributions of $4.60 per unit for 2011, which would be a 4.5 percent increase over 2010, and we expect to meet or exceed that target.”

Kinder Morgan is the one of the largest most consistent and most stable of the MLPs . Distribution for Q1 2011 was $1.14, a 7% increase from Q1 2010 and more importantly they generated coverage of the distribution that was above plan. On the conference call they said that if things continued to go well during the rest of 2011 then they would be looking at raising the distribution above their $4.60 target for the year. They mentioned the dividend growth for 2011 could be as high as 7.5% vs the 4.5% currently planned. These are impressive results for such a large and stable company.

All of Kinder Morgan’s business segments were up over last year with their CO2 business and their terminals business showing the largest growth. Here is the breakout by business segment. As the table shows Kinder Morgan is a very stable and diversified business, more so than any other MLP which are more pure plays on one segment or the other.

Three Months Ended March 31,
2011 2010
Segment earnings before DD&A and amort. of excess investments (1)
Products Pipelines $ 180.3 $ 163.9
Natural Gas Pipelines 222.6 219.3
CO2 258.3 247.8
Terminals 170.3 150.9
Kinder Morgan Canada 47.9 45.0
Total $ 879.4 $ 826.

As far as the shares go, KMP is trading at a 6% yield even as the shares hit a 52 weeks and all time high today. KMR shares are trading at a 12% discount to KMP so they yield about 6.8% based on the planned $4.60 distribution for this year. With a 4.5% growth rate with a potential upside of 7.5% growth KMR shares represent very good value. For investors looking for more growth KMI is trading at a 4% yield with a 2011 growth rate planned for 9% and with potential upside of 14%. Also, very good value.

In summary, Kinder Morgan remains the most stable, most diversified MLP in the business but also with great growth prospects.

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