Kinetik (KNTK) Q2 2026 earnings summary

Executive summary

• Achieved record financial results in Q2 2026, driven by strong operational execution, system performance, and favorable commodity prices, with accelerating momentum into the second half of 2026.

• Reached final investment decision (FID) on Kings Landing II (KLII), expanding processing capacity by 300 MMcf/d to 2.7 Bcf/d by 2028, and placed ECCC Pipeline into service.

• Secured new long-term natural gas sales and transport agreements, enhancing Gulf Coast market access and system flexibility.

• Major infrastructure and power projects advanced, including the Diamond Volt 40-MW power project, with in-service expected Q2 2027.

• Maintained robust liquidity over $1 billion and declared a $0.81 per share dividend in July 2026.

Financial highlights

• Q2 2026 Adjusted EBITDA: $281 million (+35% YoY for Midstream Logistics); distributable cash flow: $195 million; free cash flow: $105 million.

• Q2 2026 revenue: $581.4 million (+36% YoY); net income: $123.1 million; net income attributable to Class A shareholders: $49.5 million (+109% YoY).

• Midstream Logistics Adjusted EBITDA: $204.8 million in Q2 2026, up 35% YoY; Pipeline Transportation Adjusted EBITDA: $83 million, down 14% YoY due to EPIC Crude divestiture.

• Leverage ratio at 3.8x; net debt as of June 30, 2026: $3.94 billion; liquidity: $1.07 billion.

• Dividend per share: $0.81 for Q2 2026; dividend coverage ratio: 1.47x for Q2.

Outlook and guidance

• Full-year 2026 Adjusted EBITDA guidance raised to $1.04–$1.1 billion, a 7% increase from original guidance and ~15% YoY growth pro forma for EPIC Crude divestiture.

• Capital expenditures guidance increased to ~$560 million, reflecting accelerated customer development and major project investments.

• Q3 and Q4 2026 Adjusted EBITDA expected at $260–$270 million and $270–$280 million, respectively.

• Processed gas volumes expected to reach 2.2 Bcf/d average in Q4 2026, with curtailments easing in 2H26.

• Dividend increases of 3–5% per year until coverage ratio of 1.6x is reached.