Financial Performance - Total operating revenues for Q1 2025 reached $443.3 million, a 30% increase from $341.4 million in Q1 2024[15] - Service revenue increased to $127.9 million, up 25% from $102.2 million year-over-year[15] - Product revenue rose to $312.5 million, representing a 32% increase compared to $236.6 million in the same period last year[15] - Operating income decreased to $19.3 million, down 26% from $26.1 million in Q1 2024[15] - Net income attributable to Class A Common Stock Shareholders was $6.1 million, a decline of 47% from $11.6 million in Q1 2024[15] - Net income including noncontrolling interest decreased by 46% to $19.3 million compared to $35.4 million for the same period in 2024[140] - Adjusted EBITDA increased by $16.5 million, or 7%, to $250.0 million for the three months ended March 31, 2025, compared to $233.6 million for the same period in 2024[154] Cash and Assets - Cash and cash equivalents increased to $8.8 million, up from $3.6 million at the end of 2024[18] - Total assets grew to $7.0 billion, an increase from $6.8 billion at the end of 2024[18] - Total long-term debt as of March 31, 2025, was $3,595.0 million, an increase from $3,390.0 million as of December 31, 2024[61] - The Company had available committed borrowing capacity of $693.6 million as of March 31, 2025, compared to $657.2 million at the end of 2024[180] Investments and Acquisitions - The Durango Acquisition, completed on June 24, 2024, had an adjusted purchase price of approximately $785.7 million, allowing the company to expand its footprint into New Mexico and the Northern Delaware Basin[42] - The company completed the Barilla Draw Acquisition for a total of $194.1 million, enhancing its natural gas and crude gathering capabilities[136] - The company plans to issue 7.7 million shares of Class C Common Stock as deferred consideration on July 1, 2025[25] Debt and Interest - Interest expense increased by $8.2 million, or 17%, to $55.7 million, primarily due to decreased gains on interest rate swaps[148] - The fair value of the Company's consolidated debt was $3.74 billion as of March 31, 2025, up from $3.52 billion as of December 31, 2024[69] - A 1.0% increase in interest rates would result in an annualized interest expense change of approximately $16.9 million based on outstanding borrowings[186] Revenue Segments - Total segment operating revenue for the Midstream Logistics segment was $440.86 million, contributing to a consolidated revenue of $443.26 million for the three months ended March 31, 2025[115] - For the three months ended March 31, 2025, the Company reported revenues of $128.3 million from Permian Highway, $59.5 million from Breviloba, and $102.4 million from EPIC, compared to $126.2 million, $50.9 million, and $84.1 million respectively in the same period of 2024[58] Expenses - Cost of sales (excluding depreciation and amortization) increased by $69.7 million, or 45%, to $223.4 million, driven by higher NGL and condensate volumes sold[145] - Operating expenses rose by $20.2 million, or 47%, to $63.6 million, with significant contributions from the Durango and Barilla Draw acquisitions[146] - Depreciation and amortization expenses increased by $19.1 million, or 26%, to $92.7 million, largely due to the Durango and Barilla Draw acquisitions[147] Equity and Dividends - Common Unit limited partners received distributions totaling $70.52 million during the period[24] - Kinetik Holdings Inc. declared dividends on Class A Common Stock at a rate of $0.75 per share, amounting to $43.20 million[24] - During the quarter ended March 31, 2025, the Company made cash dividend payments of $123.2 million, with $0.4 million reinvested in shares of Class A Common Stock[74] Market and Economic Conditions - The annual inflation rate in the U.S. was 2.4% as of March 2025, with the Federal Open Market Committee maintaining the federal funds rate target range at 4.25% - 4.50%[139] - The U.S. government imposed a 25% tariff on steel imports on March 12, 2025, which may adversely affect the Company's construction costs[196] Strategic Initiatives - Kinetik Holdings provided an optimistic outlook, projecting a revenue growth of 10-12% for the next quarter[212] - The company is investing in new product development, with a budget allocation of $30 million for R&D in the upcoming fiscal year[212] - Kinetik is expanding its market presence, targeting a 25% increase in market share through strategic partnerships and acquisitions[212] - Kinetik is implementing new sustainability initiatives, including the issuance of 6.625% Sustainability-Linked Senior Notes to fund green projects[212] - The company emphasized the importance of technology upgrades, with a focus on enhancing user experience and operational efficiency[212]

Financial Data and Key Metrics Changes - Kinetic reported first quarter adjusted EBITDA of $250 million, a 7% year-over-year increase driven by process gas volume growth and margin expansion in the Midstream Logistics segment [7][14] - Distributable cash flow was $157 million, and free cash flow reached $120 million [14] - The company affirmed full-year adjusted EBITDA guidance of $1.09 billion to $1.15 billion, expecting a meaningful acceleration in adjusted EBITDA growth during the second half of the year [16][17] Business Line Data and Key Metrics Changes - The Midstream Logistics segment generated adjusted EBITDA of $159 million, up 11% year-over-year due to increased process gas volumes and margin expansion from Northern Delaware assets [14] - The Pipeline Transportation segment reported adjusted EBITDA of $94 million, down 2% year-over-year, primarily due to the absence of contributions from Gulf Coast Express following the sale of equity interest [16] Market Data and Key Metrics Changes - Kinetic's operations are primarily focused on the Permian Basin, which is expected to remain resilient despite macroeconomic challenges [9][10] - The company anticipates over 1 billion cubic feet per day of gas growth per year, even if Permian crude production remains flat [10] Company Strategy and Development Direction - Kinetic is focused on providing flow assurance and operational reliability to producer customers, with a strong emphasis on organic and inorganic growth opportunities [10][12] - The company announced a $500 million share repurchase program, reflecting management's confidence in Kinetic's value proposition [13][21] - Future capital expenditures are expected to be discretionary and flexible, with less than $50 million of committed growth capital in 2026 [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged elevated volatility and macroeconomic uncertainty but expressed confidence in Kinetic's ability to navigate these challenges [7][20] - The company is seeing some indirect impacts of lower commodity prices, leading to adjustments in gas process volume growth assumptions from approximately 20% to high teens growth [18][19] - Management remains optimistic about the long-term growth outlook, projecting a 10% compound annual growth rate through 2029 [23][26] Other Important Information - Kinetic has made substantial progress on strategic projects, including the commissioning of the King's Landing complex [7][19] - The company has a strong hedging strategy, with approximately 83% of expected gross profit sourced from fixed fee agreements [17][18] Q&A Session Summary Question: Long-term growth drivers - Management highlighted that the 10% compound annual growth rate is supported by contractual resets and growth in New Mexico, with a focus on operational efficiency [23][26] Question: Capital allocation and buybacks - Management confirmed a flexible approach to capital allocation, emphasizing the value seen in the current share price and the potential for M&A opportunities [28][30] Question: Macro environment and CapEx adjustments - Management indicated that further production cuts could lead to adjustments in capital expenditures, but emphasized a customer-specific approach to decision-making [49][52] Question: Commodity exposure and hedging - Management stated that approximately 83% of gross profit is fee-based, with plans to continue hedging against commodity price fluctuations [61][63] Question: Performance of acquired assets - The Barilla Draw acquisition has exceeded expectations, with significant activity anticipated in the coming years [105][106]

Financial Data and Key Metrics Changes - Kinetic reported adjusted EBITDA of $250 million for Q1 2025, a 7% increase year-over-year driven by process gas volume growth and margin expansion in the Midstream Logistics segment [6][14] - Distributable cash flow was $157 million, and free cash flow was $120 million for the quarter [14] - The company affirmed full-year adjusted EBITDA guidance of $1.09 billion to $1.15 billion, expecting a meaningful acceleration in growth during the second half of the year [15][16] Business Line Data and Key Metrics Changes - The Midstream Logistics segment generated adjusted EBITDA of $159 million, up 11% year-over-year due to increased processed gas volumes and margin expansion from Northern Delaware assets [14] - The Pipeline Transportation segment reported adjusted EBITDA of $94 million, down 2% year-over-year, primarily due to the absence of contributions from Gulf Coast Express following its sale [15] Market Data and Key Metrics Changes - Kinetic's operations are primarily focused on the Permian Basin, which is expected to remain resilient despite macroeconomic challenges [8][10] - The company anticipates over 1 billion cubic feet per day of gas growth per year, even if Permian crude production remains flat [10] Company Strategy and Development Direction - Kinetic is focused on providing flow assurance and operational reliability to producer customers, with a strong emphasis on organic and inorganic growth opportunities [10][12] - The company announced a $500 million share repurchase program, reflecting confidence in its value proposition and commitment to returning capital to shareholders [6][13] - Kinetic is taking a measured approach to future spending, with less than $50 million of committed growth capital in 2026, allowing flexibility in investment decisions [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's positioning to navigate macroeconomic uncertainties, highlighting a strong free cash flow profile and industry-leading earnings growth outlook [11][19] - The management noted that while commodity prices have declined, 83% of expected gross profit for 2025 is sourced from fixed fee agreements, providing stability [16][17] Other Important Information - Kinetic has made substantial progress on strategic projects, including the commissioning of the King's Landing complex, expected to unlock over 100 million cubic feet per day of currently curtailed volumes [16][19] - The company is also exploring behind-the-meter power generation opportunities, which could optimize costs and enhance operational efficiency [10][110] Q&A Session Summary Question: Long-term growth drivers - Management indicated that the company expects to maintain a 10% compound annual growth rate (CAGR) through 2029, driven by contractual resets and growth in New Mexico [21][24] Question: Capital allocation and buybacks - Management confirmed a flexible approach to capital allocation, emphasizing the value seen in the current share price and the potential for M&A opportunities [27][30] Question: Macro environment and CapEx adjustments - Management acknowledged uncertainty in the macro environment but indicated that they are seeing yellow lights rather than red, allowing for cautious progress on large infrastructure projects [54][55] Question: Commodity exposure and hedging - Management stated that approximately 83% of gross profit is fee-based, with only 15% directly tied to commodity prices, indicating a strong hedging strategy [61][62] Question: Performance of Barilla Draw assets - Management reported that the Barilla Draw acquisition has exceeded expectations, with significant activity anticipated in the coming years [105][106]

Kinetik Holdings Inc. (KNTK) came out with quarterly earnings of $0.05 per share, missing the Zacks Consensus Estimate of $0.23 per share. This compares to earnings of $0.12 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -78.26%. A quarter ago, it was expected that this company would post earnings of $0.37 per share when it actually produced earnings of $0.01, delivering a surprise of -97.30%.Over the last four quarters, the ...

Financial Performance - Adjusted EBITDA for Q1 2025 was $250 million[6], compared to $233559 thousand for Q1 2024[39] - Free Cash Flow for Q1 2025 was $120 million[6], compared to $107511 thousand for Q1 2024[43] - Capital Expenditures for Q1 2025 were $78 million[6] - The company is affirming FY 2025 Adjusted EBITDA guidance of $109 billion to $115 billion[9] - The company is affirming FY 2025 Capital Guidance of $450 million to $540 million[9] Operational Highlights - Average gas processed volumes for Q1 2025 were 180 Bcfpd, a 17% year-over-year increase[14] - Midstream Logistics Adjusted EBITDA for Q1 2025 was $159 million, an 11% year-over-year increase[14] - Pipeline Transportation Adjusted EBITDA for Q1 2025 was $94 million, a 2% year-over-year decrease[14] - Construction of the 220 Mmcfpd Kings Landing Complex is progressing, with commissioning expected to begin in six weeks[9] Strategic Initiatives - The company authorized a $500 million share repurchase program[9] - The company issued $250 million of 6625% sustainability-linked senior notes[9]

[Kinetik First Quarter 2025 Results](index=1&type=section&id=Kinetik%20Reports%20First%20Quarter%202025%20Financial%20and%20Operating%20Results) This report details Kinetik's financial and operational performance for the first quarter of 2025, highlighting key achievements and future outlook [Financial & Operating Highlights](index=1&type=section&id=First%20Quarter%202025%20Results%20and%20Commentary) Kinetik reported strong Q1 2025 results with increased Adjusted EBITDA and gas volumes, affirming 2025 guidance and expanding share repurchases Q1 2025 Key Performance Indicators | Metric | Q1 2025 | YoY Change | | :--- | :--- | :--- | | Net Income | $19.3 million | - | | Adjusted EBITDA | $250.0 million | +7% | | Gas Processed Volumes | 1.80 Bcf/d | +17% | - Affirmed 2025 guidance with an Adjusted EBITDA range of **$1.09 billion to $1.15 billion** and a Capital Guidance range of **$450 million to $540 million**[4](index=4&type=chunk) - The Board of Directors authorized an increase to the existing share repurchase program, bringing the total authorization to **$500 million**[4](index=4&type=chunk)[5](index=5&type=chunk) - Construction on the Kings Landing Complex is progressing, with commissioning expected to start in six weeks and operations commencing in early Q3 2025[4](index=4&type=chunk) [Management Commentary](index=1&type=section&id=Management%20Commentary) Management highlighted a solid quarter, emphasizing proactive risk management and capital flexibility, anticipating significant Adjusted EBITDA growth in H2 2025 - Management noted that the company is well-positioned to navigate macroeconomic uncertainty through proactive procurement of steel pipe, vigilant cost control, and significant capital allocation flexibility with **less than $50 million** of committed growth capital in 2026 and beyond[3](index=3&type=chunk) - The company's earnings profile is described as a "tale of two halves," with annualized first-half 2025 Adjusted EBITDA of approximately **$1 billion** expected to ramp to an annualized fourth-quarter rate of approximately **$1.2 billion** following the commissioning of Kings Landing[3](index=3&type=chunk) - If current lower commodity price futures persist, full-year Adjusted EBITDA could be negatively impacted by approximately **$20 million**, though results are still expected to fall within the 2025 guidance range[5](index=5&type=chunk) - To demonstrate conviction in the company's value, senior management will receive a material percentage of their remaining 2025 salary in Kinetik common stock, with the CEO taking **100%**[5](index=5&type=chunk) [Financial Performance](index=2&type=section&id=Financial%20Performance) Kinetik reported Q1 2025 net income of $19.3 million and Adjusted EBITDA of $250.0 million, with increased revenues but lower net income due to higher expenses [Key Financial Metrics](index=2&type=section&id=Selected%20Key%20Metrics) Kinetik generated $157.0 million in Distributable Cash Flow and $120.4 million in Free Cash Flow in Q1 2025, with Net Debt increasing to $3.73 billion Q1 2025 Financial Metrics | Metric | Value (in thousands, except ratios) | | :--- | :--- | | Adjusted EBITDA | $250,017 | | Distributable Cash Flow | $156,981 | | Free Cash Flow | $120,393 | | Dividend Coverage Ratio | 1.3x | | Leverage Ratio | 3.4x | | Net Debt to Adjusted EBITDA Ratio | 3.8x | Net Debt Comparison | Date | Net Debt (in thousands) | | :--- | :--- | | March 31, 2025 | $3,734,955 | | December 31, 2024 | $3,526,594 | - In March, the company issued an additional **$250 million** of 6.625% sustainability-linked senior notes and increased its accounts receivable securitization facility to **$250 million**[6](index=6&type=chunk) [Consolidated Statements of Operations](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) Total operating revenues increased to $443.3 million in Q1 2025, but net income decreased to $19.3 million due to higher operating and interest expenses Income Statement Summary (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total operating revenues | $443,263 | $341,394 | | Operating income | $19,280 | $26,101 | | Interest expense | ($55,714) | ($47,467) | | Net income including noncontrolling interest | $19,262 | $35,407 | | Diluted EPS | $0.05 | $0.12 | [Operational & Commercial Update](index=3&type=section&id=Operational%20and%20Commercial) Kinetik is advancing key growth projects, including the Kings Landing complex and ECCC Pipeline, while securing a new long-term gas gathering agreement - Substantial construction progress was made at the Kings Landing facility, with commissioning expected to begin in six weeks and operations in early Q3 2025[10](index=10&type=chunk) - The ECCC Pipeline right-of-way approval process continues, with construction expected to begin in Q3 2025 and an in-service date in Q1 2026[10](index=10&type=chunk) - A new long-term gas gathering and processing agreement was executed with an existing large, private producer in Reeves County, Texas, with production expected to start later in 2025[10](index=10&type=chunk) [Corporate Updates](index=3&type=section&id=Governance) Kinetik announced its virtual Annual Meeting, the retirement of its Chief Strategy Officer, and upcoming investor conference participation - The Annual Meeting will be held virtually on May 19, 2025[10](index=10&type=chunk) - Anne Psencik, Chief Strategy Officer, will retire effective June 30, 2025, and will continue to consult for the Company[10](index=10&type=chunk) - Kinetik plans to participate in investor conferences in May, June, and July 2025[10](index=10&type=chunk) [Non-GAAP Financial Measures & Reconciliations](index=4&type=section&id=Non-GAAP%20financial%20measures) This section provides reconciliations of non-GAAP measures like Adjusted EBITDA, Distributable Cash Flow, and Free Cash Flow, along with their definitions and utility Q1 2025 Reconciliation of Net Income to Adjusted EBITDA (in thousands) | Line Item | Amount | | :--- | :--- | | Net income including noncontrolling interest (GAAP) | $19,262 | | Add: Interest, taxes, D&A, and other adjustments | $230,755 | | **Adjusted EBITDA (non-GAAP)** | **$250,017** | Q1 2025 Reconciliation to DCF and FCF (in thousands) | Line Item | Amount | | :--- | :--- | | Adjusted EBITDA (non-GAAP) | $250,017 | | Adjustments (Proportionate EBITDA, interest, etc.) | ($93,036) | | **Distributable cash flow (non-GAAP)** | **$156,981** | | Adjustments (CapEx, interest, etc.) | ($36,588) | | **Free cash flow (non-GAAP)** | **$120,393** | - The report provides definitions for key non-GAAP measures including Adjusted EBITDA, Distributable Cash Flow (DCF), Free Cash Flow (FCF), and Net Debt, stating they are used to compare business operations and cash generation performance[25](index=25&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk)

Group 1 - Kinetik Holdings' stock has decreased by 23% since mid-January, indicating a significant pullback from its previous high valuations [1] - The stock was rated a HOLD in January, suggesting a cautious approach to its investment potential [1] Group 2 - The author has a professional background in the Nuclear Power industry, which informs their analysis of potential equities for long-term investment [1]

Capacity and Acquisitions - The company has approximately 2.2 Bcf/d cryogenic natural gas processing capacity, which will increase to 2.4 Bcf/d upon completion of the Kings Landing Project in mid-2025[22]. - The company entered into a definitive agreement to acquire natural gas and crude oil gathering systems assets from Permian Resources for $178.4 million, closing in early January 2025[23]. - The company acquired a 12.5% equity interest in EPIC, increasing its total ownership to 27.5%, with EPIC having a pipeline capacity of 625 MBbl/d[24]. - The Company completed the acquisition of Durango Permian LLC for an adjusted purchase price of approximately $785.7 million, significantly expanding its footprint into New Mexico and the Northern Delaware Basin[25]. - The Durango Acquisition increased processing capacity by over 200 MMcf/d and doubled existing gathering pipeline mileage, with an additional 200 MMcf/d capacity expected from the Kings Landing Project[26]. - The Company sold its 16% equity interest in the Gulf Coast Express Pipeline for an adjusted purchase price of $524.4 million, including a $30 million earn-out contingent on capital project approvals[27]. Operations and Infrastructure - The company is the fourth largest natural gas processor in the Delaware Basin and across the entire Permian Basin by processing capacity[22]. - The company provides a multi-stream opportunity for natural gas gathering, compression, and processing, as well as crude gathering services[23]. - The Midstream Logistics segment operates over 3,900 miles of pipeline in the Delaware Basin, including over 2,300 miles acquired through the Durango Acquisition[34]. - The Company has a total cryogenic processing capacity of approximately 2.2 Bcf/d across seven processing complexes[34]. - The Pipeline Transportation segment includes three equity method investment pipelines with a total capacity of 2.65 Bcf/d for the Permian Highway Pipeline, 600 MBbl/d for Shin Oak, and 625 MBbl/d for EPIC[45]. - The Delaware Link Pipeline, which provides additional transportation capacity to Waha, reached commercial in-service in October 2023 with a capacity of approximately 1.0 Bcf/d[43]. Financial Performance and Risks - The company’s success depends on maintaining or increasing hydrocarbon throughput volumes on its midstream systems[18]. - The company’s ability to return capital to stockholders through dividends and stock repurchases depends on generating sufficient cash flows[20]. - The Company may face challenges in controlling cash flows from joint ventures, potentially impacting its financial condition and results of operations[103]. - The costs of producing crude oil, natural gas, and NGLs, as well as the availability of drilling rigs and transportation facilities, are critical factors affecting revenue[104]. - The Company relies on third-party pipelines for transportation, and any disruptions could materially affect its ability to operate efficiently and generate revenue[105]. - Customers may suspend or terminate agreements under certain circumstances, which could adversely impact the Company's financial condition and cash flows[107]. Regulatory and Compliance - The Company’s intrastate natural gas operations are regulated by the Railroad Commission of Texas (TRRC), ensuring that rates and services are just and reasonable[56]. - The Company is subject to the U.S. Department of Transportation's Pipeline and Hazardous Materials Safety Administration (PHMSA) regulations, which include mandatory inspections for pipelines in high consequence areas[61]. - The Company has incurred and will continue to incur significant operating and capital expenditures to comply with environmental and occupational health and safety laws[65]. - The Company’s operations are subject to various environmental laws, including the Clean Air Act and the Clean Water Act, which may result in increased compliance costs[67]. - The Company is committed to conducting business in accordance with high ethical standards, with oversight from the Audit Committee on business ethics issues[77]. Sustainability and Environmental Impact - The Company’s sustainability strategy ties 20% of all salaried employees' at-risk pay to the achievement of specific sustainability goals, including methane emissions reduction[74]. - 100% of the Company’s debt capital structure is linked to sustainability performance, including targets related to GHG and methane emission intensity[78]. - The company aims to reduce Scope 2 GHG emissions through energy efficiency measures and sourcing renewable energy[79]. - In 2023, the company converted 3,742 natural gas-driven pneumatics and pumps to instrument air, reducing annual methane emissions by approximately 50%[79]. - The company received approval from the US EPA for the Monitoring, Reporting and Verification Plan for three Class II Acid Gas Injection wells, enabling economic benefits from sequestered CO2 through 45Q tax credits[79]. - The company is in the process of gathering 2024 GHG emission data, indicating a commitment to transparency in environmental impact reporting[78]. Safety and Risk Management - As of December 31, 2024, the Company had approximately 460 employees, with a Total Recordable Incident Rate of 0.75 and a Motor Vehicle Incident Rate of 1.36 in 2024[49][50]. - The Company emphasizes a strong safety culture, with over 18,000 hours of EHS-related training completed by employees in 2024[52]. - The company underwent 13 pipeline integrity and safety audits and three process safety inspections in 2024, resulting in one immaterial regulatory penalty[83]. - The Company’s risk management processes are overseen by the Audit Committee, which reviews ongoing assessments of the company's risk management[76]. Market and Competitive Landscape - Increased competition from other midstream service providers and alternative energy sources could negatively affect demand for the Company's services[108]. - The Company has limited direct exposure to commodity price risk, but its customers are exposed, which could impact future service volumes[112]. - The influence of major shareholders, Blackstone and I Squared Capital, may not align with the interests of other stockholders, impacting corporate actions[146][147]. Economic and Operational Challenges - The Company faces risks from natural or human causes, including severe weather, geopolitical conflicts, and pandemics, which could disrupt operations[161]. - Cybersecurity breaches pose a significant risk, potentially leading to information theft, operational disruption, and financial loss, as the Company increasingly relies on digital technologies[164]. - Changes in tax laws and regulations could adversely affect the Company's operating results and cash flows[123]. - Rate regulation and challenges to the Company's pricing could lead to increased operating expenses and reduced cash flows[126]. - The Company may experience shortages of equipment and skilled labor, which could increase costs and reduce productivity[119].

Financial Data and Key Metrics Changes - In Q4 2024, adjusted EBITDA was reported at $237 million, with distributable cash flow of $155 million and free cash flow of $32 million [19] - For the full year 2024, adjusted EBITDA reached $971 million, representing a 16% year-over-year increase, and capital expenditures totaled $265 million, which was $15 million below the midpoint of guidance [12][24] - The company exited 2024 with a leverage ratio of 3.4 times, down 0.6 times year-over-year [25] Business Line Data and Key Metrics Changes - The Midstream Logistics segment generated adjusted EBITDA of $150 million in Q4, up 3% year-over-year but down 14% sequentially due to negative Waha gas prices impacting volumes [20] - The pipeline transportation segment reported adjusted EBITDA of $92 million, up nearly 9% year-over-year, driven by volume growth and contributions from recent expansions [23] Market Data and Key Metrics Changes - Average gas processed volumes for 2024 were 1.64 billion cubic feet per day, up 13% year-over-year [11] - The company anticipates a 20% growth in gas processed volumes across the system in 2025, outpacing broader Permian growth [26] Company Strategy and Development Direction - The company aims to become a market leader in the Northern Delaware Basin, with strategic M&A and organic growth as key components of its strategy [6] - Kinetik is exploring a large-scale gas-fired power generation facility to manage electricity costs and capitalize on natural gas price volatility [15][16] - The company has set an internal target of achieving $2 billion in EBITDA by 2030, with a focus on organic growth and disciplined capital deployment [54][56] Management's Comments on Operating Environment and Future Outlook - Management noted that 2024 was transformational, with significant milestones in capital allocation and operational performance rebounding by late December [5][11] - The company expects continued growth driven by the Permian supply and US Gulf Coast demand, with LNG exports projected to double by 2030 [13][14] - Management expressed confidence in executing growth strategies and maintaining financial flexibility to pursue both organic and inorganic opportunities [97][98] Other Important Information - The company increased its cash dividend by 4%, marking the first return of capital to shareholders [9] - Kinetik was placed on a positive outlook by S&P, reflecting confidence in its growth trajectory [9] Q&A Session Summary Question: What is the execution risk associated with achieving the 10% EBITDA CAGR target? - Management indicated that they have a strong market share performance and are confident in their ability to execute on growth opportunities, particularly with the King's Landing project [38][39] Question: Are there opportunities for M&A in 2025? - Management acknowledged that while there are opportunities, they maintain a high bar for attractiveness in potential transactions [45][46] Question: How does the company plan to achieve its long-term growth targets? - Management emphasized a focus on organic growth and internal capabilities, with King's Landing being a key project for future growth [56][57] Question: What is the outlook for producer customer activity in 2025? - Management noted robust activity levels among producers, particularly in New Mexico, and highlighted the potential for increased drilling activity if gas prices improve [64][66] Question: How does the company view the competitive landscape for sour gas opportunities? - Management sees significant opportunities in sour gas processing in Northern Delaware and is focused on capitalizing on existing capacity [119] Question: What is the relationship between EBITDA growth and dividend growth? - Management stated that they are prioritizing financial flexibility and retaining cash for growth opportunities, which may result in slower dividend growth [97][98]

2024 Results & 2025 Guidance February 26, 2025 Forward looking statements This presentation includes certain statements that may constitute "forward-looking statements" for purposes of the federal securities laws. Forward-looking statements include, but are not limited to, statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intends," " ...