Boardwalk Pipeline Partners Scores (BWP, L)

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Boardwalk Pipeline Partners (NYSE:BWP) today announced 2008 third quarter net income of $73.6 million, up 84% from the third quarter of 2007. Nearly 40% of that increase was attributed to increased gas sales and mark-to-market gains on the company’s expansion projects.

To date in 2008, Boardwalk has spent about $1.7 billion on threeexpansion projects for which the total cost is estimated at about $3.9billion. Financing these projects has been costly for the company, andthe failure of Lehman Brothers forced Boardwalk to max out its $1billion revolving credit facility. To raise more capital, the companyissue $1 billion in new partnership units. That’s the bad news. Thegood news is that Loews Corporation (NYSE:L), Boardwalk’s largestshareholder, has agreed to provide the money in case Boardwalk can’traise the cash. Loews’ stock is down about 40% for the year, so thatmay be a promise Loews keeps by selling off Boardwalk.

Shares are indicated up almost 4% at $21.88 right before the open, and its 52-week trading range is $14.00 to $32.74.

Paul Ausick
October 27, 2008