Summit Midstream Corp. (SMC) Earnings

Management highlights

### Macro Environment - The macro outlook has become increasingly constructive for Summit Midstream, with 80% of 2026 well connections expected in crude oil-oriented basins. Higher crude prices improve producer economics and incentivize accelerated activity levels. - Natural gas demand remains favorable: Henry Hub pricing is constructive, LNG export demand is growing rapidly, and long-term demand from data center expansion and electrification supports the company's MidCon and Permian segment infrastructure. - MidCon segment assets are well-positioned on the natural gas pipeline grid to serve growing Gulf Coast LNG and power markets, while the Permian EE pipeline connects Delaware Basin residue gas to Waha hub and downstream Gulf/East Coast markets. ### Operational Activity - 37 total wells were connected during Q1 2026, including the first four Williston Basin wells under a new 10-year crude gathering agreement, with encouraging early production results. - Lower-than-expected performance from two Arcoma segment pads (drilled to extend proven undeveloped formation boundaries) drove Q1 volume underperformance, but a new three-well pad connected post-quarter has significantly outperformed internal expectations. - The company has five active rigs in the MidCon segment, ~80 drilled but uncompleted wells, and expects 40 new well connections in Q2 2026, 20 of which will be in the MidCon segment, with meaningful volume growth expected in H2 2026. - Post-quarter, the company executed a new 10-year take-or-pay agreement for 100 million cubic feet per day of firm EE pipeline capacity, starting in H1 2027, bringing total contracted EE capacity to over 1.7 BCF per day. ### Balance Sheet and Capital Actions - The company repaid all $45 million of accrued Series A preferred stock dividends, clearing a key milestone for reinstating a common stock dividend. - A $42 million private placement of common stock to an affiliate of Tailwater Capital (Summit's largest shareholder) was completed to fund high-return organic growth projects. - The Summit Permian Transmission term loan refinancing was closed, providing financial flexibility to fund EE pipeline expansion while continuing to deleverage the corporate balance sheet.

Guidance

- Management reaffirms full-year 2026 adjusted EBITDA guidance is on track to hit the midpoint of the original $225 million to $265 million range ($245 million), despite Q1 volume weakness in the Arcoma region. - The company expects more than $100 million of organic adjusted EBITDA growth from its existing asset portfolio by 2030, driven by improving commodity price trends and accelerating producer activity. - The EE pipeline expansion project is expected to grow segment EBITDA to $90 million post-completion, with additional upside from further expansion beyond the current 800 million cubic feet per day project.

Segment performance

1. Rockies Segment: Generated adjusted EBITDA of $26.4 million, a $1.5 million decrease relative to Q4 2025. This decline was driven by a $1.2 million non-cash imbalance, a 3% reduction in liquids volumes, lower realized residue gas prices, and lower freshwater sales, partially offset by a 4.4% increase in natural gas volume throughput and improving crude oil and NGL prices starting in March 2026. It contributes approximately 48.7% of total Q1 2026 adjusted EBITDA. 2. Permian Segment: Reported adjusted EBITDA of $8.7 million, flat relative to Q4 2025. Average throughput volumes reached 805 million cubic feet per day during the quarter. It contributes approximately 16.1% of total Q1 2026 adjusted EBITDA. 3. Pion Segment: Reported adjusted EBITDA of $9.6 million, a $0.4 million decrease from Q4 2025. The decline was primarily driven by a 7.3% volume throughput decline (including 8 million cubic feet per day of temporary shut-ins and natural production declines), with no new wells connected during the quarter. Approximately 20 million cubic feet per day of volume remains shut-in due to low regional gas prices. It contributes approximately 17.7% of total Q1 2026 adjusted EBITDA. 4. Midtown (MidCon) Segment: Reported adjusted EBITDA of $19.3 million, a $2.1 million decrease from Q4 2025, primarily driven by natural production declines, partially offset by six new Arcoma well connections during the quarter. It contributes approximately 35.6% of total Q1 2026 adjusted EBITDA. Total Q1 2026 adjusted EBITDA across all segments was $54.2 million, in line with market expectations.

Risks & headwinds

No explicit discussion of material new risks or operational failures beyond the noted Q1 underperformance: lower-than-expected production from two exploratory Arcoma pads and temporary volume shut-ins in the Pion segment due to low regional natural gas prices. Forward-looking statements carry standard uncertainty around actual results differing from expectations, as detailed in prior SEC filings.

Analyst Q&A

• Q: What is EE Pipeline's competitive positioning, is incremental demand growing from LNG exports, and could it require additional expansion beyond the current project? /

  A: Most competing pipelines have already filled their existing takeaway capacity, and low-cost incremental expansion options for rivals are exhausted; EE is one of the only options available by 2028 to meet growing Permian residue gas demand, with low-cost expansion capability and market-aligned rates. While LNG export growth has been the primary near-term demand catalyst, management also sees growing demand from new power generation and data center markets in the Southwest and Midwest, and expects additional expansion beyond the current 800 million cubic feet per day project. EE EBITDA is expected to grow to ~$90 million with the current expansion, with further upside long-term.

• Q: How sustainable is Rockies segment throughput growth, what producer activity is seen in DJ and Williston basins, and what is the margin profile? /

  A: Multiple large producers are accelerating activity in the DJ Basin, with 16 wells expected online in Q2 2026 as part of a multi-year development program, and other operators adding rigs following acquisitions. Several Williston Basin producers are also accelerating activity, with new wells coming online in Q3 2026 and additional activity planned for 2027. The Rockies segment is expected to grow from ~$85 million current EBITDA to $160 million by 2030, with ~35% of margin exposed to commodity prices, split 75% between crude and NGLs and 25% for residue gas.

• Q: Are there bolt-on acquisition opportunities in core operating regions, and what is the profile of target assets? /

  A: The most actionable near-term opportunities are in the Rockies, where many privately held midstream systems are seeking liquidity. These targets are expected to have purchase multiples of 5-7x LTM EBITDA, are synergistic to existing operations, and are expected to be value and credit accretive. Larger opportunities exist in the Permian (typically $150-$200 million transaction size) which are more complex; management is focused on Rockies opportunities in the near term but does not rule out Permian deals long-term.

• Q: What are the remaining capital structure optimization goals, and how is capital allocated between debt reduction, growth, acquisitions, and shareholder returns? /

  A: The key near-term priority is using free cash flow after funding organic growth for debt repayment to reach the company's long-term 3.5x leverage target. High-return organic growth projects (often with 20-30%+ unlevered returns) will be prioritized alongside deleveraging. After reaching the leverage target, management expects to be able to reinstate a common dividend, with a clear path to achieving this goal in the near future.