Western Midstream Partners (WES) Q4 2024 earnings summary

Executive summary

• Achieved record 2024 throughput growth across all product lines, with double-digit increases in natural gas, crude oil/NGLs, and produced water volumes year-over-year, supported by successful Meritage Midstream integration and major Delaware Basin water infrastructure expansion, including the Pathfinder Pipeline anchored by long-term agreements with Occidental Petroleum.

• Adjusted EBITDA grew 13% to $2.344 billion and free cash flow rose 37% to $1.324 billion, both exceeding guidance; net income attributable to limited partners was $1.54 billion for 2024.

• Divested non-core assets for approximately $795 million, using proceeds to reduce long-term debt and leverage to around 3x by year-end 2024, ahead of schedule.

• Returned $1.246 billion to unitholders in 2024, including a 52% increase in the base distribution, and set a new long-term annual distribution growth target of mid to low single digits.

• Commenced operations of Mentone III, advanced North Loving train construction, and sanctioned the Pathfinder Pipeline and new SWD facilities.

Financial highlights

• Full year 2024 adjusted EBITDA was $2.344 billion (up 13% YoY), and free cash flow was $1.324 billion (up 37% YoY), both above guidance.

• Net income attributable to limited partners for 2024 was $1.54 billion; Q4 net income was $326 million.

• Q4 2024 cash flow from operations was $554 million; free cash flow was $309 million.

• Capital expenditures for 2024 were $790 million, within guidance.

• Total revenues for 2024 were $3.61 billion, up from $3.11 billion in 2023.

Outlook and guidance

• 2025 adjusted EBITDA guidance is $2.35–$2.55 billion, midpoint $2.45 billion (5% YoY growth); free cash flow guidance is $1.275–$1.475 billion, midpoint $1.375 billion (4% YoY growth).

• 2025 capital expenditures expected at $625–$775 million, midpoint $700 million, with 67% allocated to expansion and $65 million for Pathfinder.

• Full year 2025 distribution guidance is at least $3.60 per unit, a 4% increase from prior quarter and 13% above prior year.

• Throughput growth in 2025 expected to be low- to mid-single digits across all products, with Delaware Basin as primary driver.

• No enhanced distribution planned for 2025; focus is on sustainable base distribution growth.