Kinetik (US:KNTK)2025-11-05 23:08Financial Performance - Kinetik reported net income of $15.5 million for Q3 2025 and $109.2 million for the first nine months of 2025[2]. - Adjusted EBITDA for Q3 2025 was $242.6 million, with a total of $735.6 million for the nine months ended September 30, 2025[2]. - Total operating revenues for Q3 2025 reached $463.97 million, a 17% increase from $396.36 million in Q3 2024[20]. - Product revenue for the nine months ended September 30, 2025, was $981.70 million, up 24.7% from $787.09 million in the same period of 2024[20]. - Operating income for Q3 2025 was $19.79 million, a decrease of 72.9% compared to $72.87 million in Q3 2024[20]. - Adjusted EBITDA for the nine months ended September 30, 2025, was $735.58 million, slightly up from $733.64 million in the same period of 2024[22]. - Distributable cash flow for Q3 2025 was $158.49 million, down 13.9% from $184.16 million in Q3 2024[22]. - Net income attributable to holders of Class A Common Stock for Q3 2025 was $5.27 million, a decline of 79.5% from $25.76 million in Q3 2024[20]. - The company reported a basic net income per share of $0.03 for Q3 2025, down from $0.35 in Q3 2024[20]. - The company reported an income before income taxes of $16,658 thousand for Q3 2025, a significant decrease from $91,914 thousand in Q3 2024, indicating a decline of approximately 82%[30][31]. Operational Highlights - The company processed natural gas volumes of 1.84 Bcf/d in Q3 2025, an 8% increase year-over-year[6]. - Kinetik achieved full commercial in-service at the Kings Landing Complex, adding over 200 Mmcf/d of gas processing capacity[9]. - Kinetik reached final investment decision on the acid gas injection project at Kings Landing, expected to be in service by year-end 2026[10]. - The Midstream Logistics segment generated Adjusted EBITDA of $151 million, a 13% decrease year-over-year[6]. - Segment Adjusted EBITDA for the Midstream Logistics segment was $151,358 thousand for Q3 2025, compared to $173,623 thousand for Q3 2024, indicating a decrease of about 13%[30][31]. - The total segment operating revenue for the nine months ended September 30, 2025, was $1,333,970 thousand, up from $1,325,621 thousand in the same period of 2024, reflecting a slight increase of approximately 0.6%[32]. Financial Guidance and Capital Expenditures - The company revised its 2025 Adjusted EBITDA guidance to a range of $965 million to $1.005 billion[4]. - Capital expenditures for 2025 are now guided to be between $485 million and $515 million[7]. - Kinetik repurchased $176 million of Class A common stock year to date, with $100 million repurchased in Q3 2025[6]. Debt and Expenses - Net debt as of September 30, 2025, was $4.15 billion, an increase from $3.94 billion as of September 30, 2024[25]. - Interest expense for the nine months ended September 30, 2025, totaled $173.95 million, compared to $167.55 million in the same period of 2024[22]. - Total operating costs and expenses for Q3 2025 were $444.18 million, a 37.3% increase from $323.49 million in Q3 2024[20]. - General and administrative expenses for Q3 2025 totaled $30,096 thousand, compared to $29,619 thousand in Q3 2024, showing a slight increase of about 1.6%[30][31]. - The total costs of sales (excluding depreciation and amortization) for Q3 2025 were $235,391 thousand, up from $144,586 thousand in Q3 2024, reflecting a significant increase of approximately 63%[30][31]. Equity and Investments - The company closed the sale of its 27.5% equity interest in EPIC Crude, generating over $500 million in net cash proceeds[6]. - The company recognized equity in earnings of unconsolidated affiliates amounting to $58,289 thousand for Q3 2025, compared to $53,244 thousand in Q3 2024, representing an increase of approximately 9%[30][31]. - The company reported a gain on the sale of equity method investment of $89,837,000 and equity income from unconsolidated affiliates of $169,668,000[33]. Definitions and Accounting Practices - Adjusted EBITDA is defined as net income adjusted for interest, taxes, depreciation, and other non-recurring charges, providing a basis for operational performance comparison[35]. - Free Cash Flow is defined as Distributable Cash Flow adjusted for various expenditures, which is a useful measure for comparing cash generation performance over periods[27]. - Net Debt at the balance sheet date is defined as total short-term and long-term debt less cash and cash equivalents, providing insight into the company's leverage position[28]. - Intersegment revenue was eliminated at consolidation, with the company accounting for intersegment sales at market prices[34].