Kinetik Reports Third Quarter 2025 Financial and Operating Results and Revises 2025 Financial Guidance

Core Insights - Kinetik Holdings Inc. reported a net income of $15.5 million for Q3 2025 and $109.2 million for the first nine months of 2025, with Adjusted EBITDA of $242.6 million and $735.6 million respectively [2][5] - The company achieved full commercial in-service at the Kings Landing Complex, enhancing processing capacity in New Mexico, which is expected to support growth in the Delaware Basin [4][12] - Kinetik revised its 2025 Adjusted EBITDA guidance to a range of $965 million to $1.005 billion, reflecting ongoing market conditions and operational adjustments [6][11] Financial Performance - For Q3 2025, Kinetik generated Distributable Cash Flow of $158.5 million and Free Cash Flow of $50.9 million [2][5] - The Midstream Logistics segment saw a 13% decrease in Adjusted EBITDA year-over-year, while the Pipeline Transportation segment experienced a nearly 1% decrease [8][9] - The company repurchased $176 million of Class A common stock year-to-date, with $100 million repurchased in Q3 2025 [9][10] Operational Highlights - The Kings Landing Complex added over 200 million cubic feet per day (Mmcf/d) of gas processing capacity, which is crucial for returning curtailed volumes and supporting new development plans [4][12] - Kinetik reached a final investment decision (FID) on the acid gas injection project at Kings Landing, expected to enhance the company's capabilities in handling sour gas [6][13] - The company secured a five-year LNG pricing agreement with INEOS Energy for 0.5 million tonnes per annum at Port Arthur LNG, starting in early 2027 [6][15] Market Context - The Permian Basin remains a low-cost source of hydrocarbons, but the Delaware Basin rig count has decreased nearly 20% since the start of 2025, indicating a slowdown in producer activity [4][6] - Kinetik's management remains confident in the long-term value proposition despite current commodity headwinds and production challenges in the region [4][6] - The company is addressing takeaway constraints at the Waha Hub by enhancing transport capacity to the U.S. Gulf Coast, expected to commence in 2028 [15][16]