DT Midstream, Inc. Q1 FY2025 earnings call

• DT Midstream is off to a strong start in 2025, reaffirming 2025 adjusted EBITDA guidance range and 2026 adjusted EBITDA early outlook range, and executing on a $2.3 billion organic growth project backlog.
• Integration of newly acquired interstate pipelines is progressing on schedule, with full cutover of financial activities into DTM systems on April 1 and on track to complete remaining milestones by year-end.
• Construction is underway on the Midwestern Gas Transmission Power Plant Lateral, and in-flight growth investments are on track and on budget. Expansions across the gathering footprint will contribute in the second half of the year.
• Discussed market fundamentals, noting the first quarter was volatile but DTM is well-positioned with durable contracts, over 80% investment-grade rated customers, and no commodity exposure. Long-term fundamentals for natural gas infrastructure remain strong with growing demand from LNG exports, power sector, and political support.

In the first quarter, DT Midstream delivered adjusted EBITDA of $280 million. The Pipeline segment, comprising 70% of adjusted EBITDA, had results $39 million higher than the fourth quarter of 2024, including a full quarter contribution from acquired interstate pipelines. The Gathering segment, making up 30% of adjusted EBITDA, had results $6 million greater than the fourth quarter of 2024, driven by lower expenses in Q1 2025 and growing volumes in the Haynesville. Operationally, total gathering volumes in the Haynesville averaged 1.67 Bcf per day, up from the fourth quarter, while Northeast volumes averaged 1.3 Bcf per day, down from the fourth quarter but in line with the full year plan.

• Reaffirmed 2025 adjusted EBITDA guidance range and 2026 adjusted EBITDA early outlook range.
• Executing on a $2.3 billion organic growth project backlog.
• Committed approximately $365 million in capital in 2025 and approximately $100 million in 2026 for new projects.
• Board of Directors approved a first quarter dividend of $0.82 per share, unchanged from prior quarter, with commitment to grow dividend 5%-7% per year in line with long-term adjusted EBITDA growth.

• Market volatility in the natural gas sector, but DTM is fundamentally well-positioned with durable contracts and minimal exposure. Tariffs are not expected to have material effect as long-term contracts and strategic supplier relationships are in place.

Q: Michael Blum asked about gathering volumes in Q1, specifically Haynesville uptick and Northeast downtick.

A: David Slater responded that Haynesville uptick is in line with public producers' activity, privates are active, confident in Haynesville activity continuing. Appalachia volumes are as expected with projects clicking in second half.

Q: Jeremy Tonet inquired about Millennium open season.

A: David Slater said open season is to gauge market interest in incremental capacity, Millennium has opportunities to repurpose capacity, early signs of demand growth across footprint.

Q: Theresa Chen asked about backlog and Northeast/Midwest assets.

A: David Slater stated acquisition assets performed well, opportunity set more robust than initially thought, will provide updates as confident.

Q: Spiro Dounis asked about LEAP expansion and cadence.

A: David Slater said LEAP expansion in bite-sized increments, well-positioned, Haynesville activity watched, Woodside FID positive. Jeff Jewell added second half stronger due to volume and projects, winter seasonality in Q1.

Q: John Mackay asked about privates in Haynesville responding to price changes.

A: David Slater said watching closely, privates disciplined in hedging, no evidence of quick response to price drop yet.

Q: Keith Stanley asked about CapEx and projects closer to moving forward.

A: David Slater said backlog opportunities growing, more bullish on acquisition opportunities, projects progressing to FID.

Q: Jean Salisbury asked about Borealis project and Appalachia footprint.

A: David Slater said Borealis project could benefit DTM with potential gathering investments, assessed for synergies.

Q: Manav Gupta asked about data center demand post Microsoft pullback.

A: David Slater said active on utility scale and site-specific data centers, demand still growing, utilities involved in connecting data centers.

Q: Robert Mosca asked about Haynesville customer productive capacity in 2026.

A: David Slater said all customer plans are reflected in guidance, insights from customers captured in 2025 and 2026 guidance.