Kinetik (KNTK) Q2 2026 earnings summary

Executive summary

• Achieved record financial results in Q2 2026, driven by strong operational execution, commodity margin outperformance, and higher product sales volumes and prices.

• Reached final investment decision 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.

• Signed new long-term natural gas sales and transport agreements, expanding Gulf Coast market access and operational flexibility.

• Advanced major infrastructure and power projects, including the Diamond Volt 40-MW power project and acid gas injection project.

• Maintained robust liquidity with $1.07 billion available as of June 30, 2026, 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 net income: $123.1 million (including noncontrolling interest); net income attributable to Class A shareholders: $49.5 million.

• Q2 2026 operating revenues: $581.4 million (+36% YoY); gross margin: 59.2%.

• Net debt as of June 30, 2026: $3.94 billion; liquidity exceeded $1 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% year-over-year 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.

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

• Management expects cash from operations, pipeline distributions, and credit facilities to cover capital expenditures and dividends over the next 12 months.