DT Midstream(DTM) - 2025 Q1 - Quarterly Report

Financial Performance - Operating revenues for the three months ended March 31, 2025, increased to $303 million, up from$240 million in the same period of 2024, representing a 26.25% growth[25] - Net income attributable to DT Midstream for the three months ended March 31, 2025, was $108 million, compared to$97 million for the same period in 2024, reflecting an 11.34% increase[25] - Basic earnings per common share rose to $1.07 for the three months ended March 31, 2025, compared to$1.00 for the same period in 2024, marking a 7% increase[25] - Operating income for the three months ended March 31, 2025, was $148 million, compared to$124 million in the same period of 2024, a 19.35% increase[25] - The company reported comprehensive income attributable to DT Midstream of $109 million for the three months ended March 31, 2025, compared to$97 million in the same period of 2024, a 12.37% increase[27] - Net cash from operating activities for the three months ended March 31, 2025, was $247 million, compared to$241 million for the same period in 2024, a 2.49% increase[34] - As of March 31, 2025, DT Midstream reported a net income of $111 million, compared to$100 million for the same period in 2024, reflecting an increase of 11%[36] - The company declared dividends of $0.820 per common share, totaling$83 million for the first quarter of 2025, up from $71 million in the same quarter of 2024[36] - Basic earnings per share for Q1 2025 were$1.07, up from $1.00 in Q1 2024, while diluted earnings per share increased to$1.06 from $0.99[87] Assets and Liabilities - Total assets as of March 31, 2025, were$9,932 million, slightly down from $9,935 million as of December 31, 2024[30] - Total liabilities decreased to$5,150 million as of March 31, 2025, from $5,169 million as of December 31, 2024[32] - The company’s long-term debt remained stable at$3,320 million as of March 31, 2025, compared to $3,319 million at the end of 2024[32] - The company’s retained earnings balance as of March 31, 2025, was$747 million, slightly up from $723 million as of December 31, 2024[36] - Total assets as of March 31, 2025, amounted to$929 million, a slight increase from $914 million as of December 31, 2024[48] - The carrying value of goodwill remained unchanged at$776 million as of March 31, 2025, with no impairments reported[85] Cash and Liquidity - Cash and cash equivalents increased to $83 million as of March 31, 2025, up from$68 million at the end of 2024, indicating a 22.06% increase[30] - Cash and cash equivalents increased to $24 million as of March 31, 2025, from$17 million at the end of 2024[48] - The company maintains a Revolving Credit Facility as a source of liquidity, alongside cash generated from operations[42] - The company has a total availability of $1 billion under the Revolving Credit Facility, with net availability of$919 million after accounting for outstanding borrowings of $65 million and letters of credit of$16 million[100] - The weighted average interest rate for Revolving Credit Facility borrowings outstanding was 5.68% as of March 31, 2025[100] Acquisitions and Investments - The company completed the Midwest Pipeline Acquisition on December 31, 2024, enhancing its natural gas transmission capabilities[38] - The company completed the Midwest Pipeline Acquisition on December 31, 2024, for a preliminary purchase price of $1.2 billion, acquiring 100$11 million, with the excess purchase price classified as goodwill[121] - The Clean Fuels Gathering segment's results of operations are included after the July 1, 2024 acquisition date[114] Revenue Streams - Pipeline revenue increased to $169 million in Q1 2025 from$107 million in Q1 2024, while gathering revenue remained relatively stable at $134 million compared to$133 million[71] - Operating revenues for non-consolidated equity method investees were $209 million for the three months ended March 31, 2025, compared to$214 million in 2024[56] - Earnings from equity method investees totaled $37 million for the three months ended March 31, 2025, down from$46 million in the same period of 2024[52] Financial Ratios and Covenants - The consolidated net leverage ratio as of March 31, 2025, is 2.3 to 1, and the interest coverage ratio is 9.0 to 1, indicating compliance with financial covenants[104] - The interim effective tax rate for the three months ended March 31, 2025, was 24%, consistent with the same period in 2024[90] Other Financial Information - Contract liabilities as of March 31, 2025, amounted to $155 million, with expected revenue recognition of$15 million in the remainder of 2025[77] - The total transaction price allocated to remaining performance obligations expected to be recognized as revenue in future periods is $1.414 billion[80] - The company has accrued contingent liabilities of$3 million for future slope restoration expenditures as of March 31, 2025[111] - The company has a maximum potential indemnification under surety bond agreements of $13 million as of March 31, 2025[107] - The company has a credit facility to Vector for CAD$70 million, with a maximum potential payout of USD $49 million[108] - The company recorded$10 million as a long-term prepaid asset related to a gas supply agreement at Clean Fuels Gathering, with $6 million paid during the three months ended March 31, 2025[109] Risks and Dependencies - The company is dependent on a key customer, Expand Energy, for a significant portion of its revenues, which poses a credit risk if volumes from this customer decline[174] - The most recent FERC rate proceedings for the company's pipelines were settled on February 15, 2023, May 3, 2022, and July 31, 2024, with no open proceedings as of March 31, 2025[127]