Summit Midstream Corporation Reports Second Quarter 2025 Financial and Operating Results
HOUSTON, Aug. 12, 2025 /PRNewswire/ -- Summit Midstream Corporation (NYSE:SMC) ("Summit", "SMC" or the "Company") announced today its financial and operating results for the three months ended June 30, 2025.
Highlights
Second quarter 2025 net loss of $4.2 million, adjusted EBITDA of $61.1 million, cash flow available for distributions ("Distributable Cash Flow" or "DCF") of $32.4 million and free cash flow ("FCF") of $9.2 million
Connected 47 wells during the second quarter and maintained an active customer base with three drilling rigs, and an additional rig expected in the Arkoma, with over 100 DUCs behind our systems
Anchor customer in the Arkoma Basin expected to begin drilling a 20-well program with completions starting in the fourth quarter of 2025 through the first half of 2026
Executed a 10-year extension of certain gathering agreements with key customer in the Williston Basin
Executed a new precedent agreement for 100 MMcf/d of firm capacity on the Double E Pipeline, with Q4 2026 expected in-service date and 10-year term
SMC added to the Russell 3000, Russell 2000, and Russell Microcap Indexes during the June 30, 2025 FTSE Russell reconstitution
Expect year-end financial results to be near the low end of our original 2025 Adjusted EBITDA guidance range of $245 million to $280 million
Management Commentary
Heath Deneke, President, Chief Executive Officer and Chairman, commented, "We generated $61.1 million of Adjusted EBITDA in the second quarter, slightly below our expectations at the midpoint of our guidance range, and connected 47 wells to our systems. The primary driver of underperformance relative to internal expectations this quarter was the timing and performance of certain wells in the DJ and Arkoma Basins, as well as lower than expected realized commodity prices in the DJ Basin. We view the timing impacts as temporary in nature and expect to recover the associated volumes in the second half of this year and into 2026. While crude oil prices have recovered and natural gas prices remain supportive, customers have not reverted development timing back to their original plans established earlier in the year, and as such we expect to be near the low end of our 2025 Adjusted EBITDA guidance range.
From a commercial perspective we remain active across the footprint. In the Arkoma, our key customer is expected to start an incremental 20-well development program, with a drilling rig scheduled to return in the third quarter and completions beginning in the fourth quarter of 2025 through the second quarter of 2026. In the Rockies we are actively pursuing several organic growth opportunities associated with sizeable incremental development programs beginning in 2026, as well as a few targeted bolt-on acquisitions to continue to expand our footprint, service offering and scale in the region. Further, we recently executed a 10-year extension of certain gathering agreements with a key customer in the Williston Basin, extending our weighted average contract life from four years to eight years in the basin. In the Permian, we executed a new precedent agreement for 100 MMcf/d of firm capacity behind the Double E Pipeline, tied to an expansion of a processing plant located in Lea County, New Mexico. The agreement is contingent upon satisfaction of certain customary conditions precedent and is subject to customer providing notice of its final investment decision to construct the new plant. We currently expect a Q4 2026 in-service date for the new plant connection and associated firm transportation agreement. Double E remains a highly strategic asset in the Delaware Basin and we continue to believe the pipeline is well positioned for additional commercial contracts and growth."
Second Quarter 2025 Business Highlights
SMC's average daily natural gas throughput on its wholly owned operated systems increased 3.3% to 912 MMcf/d, while liquids volumes increased 5.4% to 78 Mbbl/d, relative to the first quarter of 2025. Double E pipeline transported an average of 682 MMcf/d and contributed $8.3 million in adjusted EBITDA, net to SMC, for the second quarter of 2025.
Natural gas price-driven segments:
Natural gas price-driven segments generated $35.4 million in combined segment adjusted EBITDA, a 3.3% increase relative to the first quarter and combined capital expenditures of $14.6 million in the second quarter of 2025.
Mid-Con segment adjusted EBITDA totaled $24.9 million, an increase of $2.4 million relative to the first quarter of 2025, primarily due to an increase in volume throughput on the system and higher natural gas sales. Volume throughput on the system increased by 2.9% primarily due to three new well connections in the Arkoma and six new well connections in the Barnett, partially offset by natural productions declines. Subsequent to quarter end, six new wells were connected in the Arkoma and four new wells were connected in the Barnett, bringing year-to-date total well connections to 30 in the Mid-Con segment. Additionally, a key customer in the Arkoma is expected to mobilize a rig in the third quarter to begin an additional 20-well development program. There is currently one rig running in the Barnett and one expected in the Arkoma, with 17 DUCs behind the system.
Piceance segment adjusted EBITDA totaled $10.5 million, a decrease of $1.3 million relative to the first quarter of 2025, primarily due to higher operating expenses and a 1.1% decrease in volume throughput. There were no new wells connected to the system during the quarter.
Oil price-driven segments:
Oil price-driven segments generated $33.5 million of combined segment adjusted EBITDA, representing a 1.2% increase relative to the first quarter of 2025, and had combined capital expenditures of $10.8 million.
Rockies segment adjusted EBITDA totaled $25.2 million, an increase of $0.4 million relative to the first quarter of 2025, primarily due to a 5.4% increase in liquids volume throughput and 14.0% increase in natural gas volume throughput from the acquisition of Moonrise Midstream in the DJ Basin on March 10, 2025, partially offset by a reduction in realized commodity prices, lower margin mix and higher operating expenses in the DJ Basin. Relative to the first quarter, realized residue gas prices decreased approximately 40%, realized NGL prices decreased approximately 10% and realized condensate prices decreased approximately 15%, which had an estimated Adjusted EBITDA impact of approximately $2.0 million. Volumes on Summit's legacy DJ Basin system, excluding incremental volumes from the Moonrise Midstream acquisition, were flat quarter-over-quarter, however, margin mix decreased as a result of higher volume contribution from lower margin contracts, which had an estimated Adjusted EBITDA impact of approximately $1.0 million. Additionally, segment operating expenses and general & administrative expenses increased by approximately $4.5 million relative to the first quarter, which included approximately $1.0 million of timing-related items and one-time costs, which is expected to normalize over the balance of the year. There were 38 new wells connected during the quarter, including 32 in the DJ Basin and 6 in the Williston Basin. There are currently two rigs running and approximately 85 DUCs behind the systems.
Permian segment adjusted EBITDA totaled $8.3 million, a slight increase from the first quarter of 2025, primarily due to a 2.8% increase in volumes shipped on the Double E Pipeline leading to an increase in proportionate adjusted EBITDA from our Double E joint venture.
The following table presents average daily throughput by reportable segment for the periods indicated:
Three Months Ended June 30,
Six Months Ended June 30,
2025
2024
2025
2024
Average daily throughput (MMcf/d):
Northeast (1)
—
95
—
404
Rockies
147
130
138
127
Piceance
263
289
265
301
Mid-Con
502
202
496
191
Aggregate average daily throughput
912
716
899
1,023
Average daily throughput (Mbbl/d):
Rockies
78
75
76
75
Aggregate average daily throughput
78
75
76
75
Ohio Gathering average daily throughput (MMcf/d) (2)
—
—
—
425
Double E average daily throughput (MMcf/d) (3)
682
549
673
508
_________
(1)
Exclusive of Ohio Gathering due to equity method accounting.
(2)
Gross basis, represents 100% of volume throughput for Ohio Gathering, subject to a one-month lag.
(3)
Gross basis, represents 100% of volume throughput for Double E.
The following table presents adjusted EBITDA by reportable segment for the periods indicated:
Three Months Ended June 30,
Six Months Ended June 30,
2025
2024
2025
2024
(In thousands)
(In thousands)
Reportable segment adjusted EBITDA (1):
Northeast (2)
$ ,
$ 1,613
$ ,
$ 30,634
Rockies
25,235
22,858
50,104
45,732
Permian (3)
8,300
7,697
16,570
14,962
Piceance
10,474
12,848
22,260
28,081
Mid-Con
24,900
5,420
47,357
10,520
Total
$ 68,909
$ 50,436
$ 136,291
$ 129,929
Less: Corporate and Other (4)
7,815
7,288
17,691
16,722
Adjusted EBITDA (5)
$ 61,094
$ 43,148
$ 118,600
$ 113,207
__________
(1)
Segment adjusted EBITDA is a non-GAAP financial measure. We define segment adjusted EBITDA as total revenues less total costs and expenses, plus (i) other income (excluding interest income), (ii) our proportional adjusted EBITDA for equity method investees, (iii) depreciation and amortization, (iv) adjustments related to minimum volume commitments ("MVC") shortfall payments, (v) adjustments related to capital reimbursement activity, (vi) share-based and noncash compensation, (vii) impairments and (viii) other noncash expenses or losses, less other noncash income or gains.
(2)
Includes our proportional share of adjusted EBITDA for Ohio Gathering. Summit records financial results of its investment in Ohio Gathering on a one-month lag and is based on the financial information available to us during the reporting period. With the divestiture of Ohio Gathering in March 2024, proportional adjusted EBITDA includes financial results from December 1, 2023 through March 22, 2024. We define proportional adjusted EBITDA for our equity method investees as the product of (i) total revenues less total expenses, excluding impairments and other noncash income or expense items and (ii) amortization for deferred contract costs; multiplied by our ownership interest during the respective period.
(3)
Includes our proportional share of adjusted EBITDA for Double E. We define proportional adjusted EBITDA for our equity method investees as the product of total revenues less total expenses, excluding impairments and other noncash income or expense items; multiplied by our ownership interest during the respective period.
(4)
Corporate and Other represents those results that are not specifically attributable to a reportable segment or that have not been allocated to our reportable segments, including certain general and administrative expense items and transaction costs.
(5)
Adjusted EBITDA is a non-GAAP financial measure.
Capital Expenditures
Capital expenditures totaled $26.4 million in the second quarter of 2025, inclusive of maintenance capital expenditures of $5.5 million. Capital expenditures in the second quarter of 2025 were primarily related to pad connections in the Rockies and Mid-Con segments and compressor relocations from the Piceance to the Arkoma.
Six Months Ended June 30,
2025
2024
(In thousands)
Cash paid for capital expenditures (1):
Northeast
$ ,
$ 2,817
Rockies
22,321
20,468
Piceance
1,200
873
Mid-Con
21,726
525
Total reportable segment capital expenditures
$ 45,247
$ 24,683
Corporate and Other
1,749
2,237
Total cash paid for capital expenditures
$ 46,996
$ 26,920
__________
(1)
Excludes cash paid for capital expenditures by Ohio Gathering and Double E due to equity method accounting.
Capital & Liquidity
As of June 30, 2025, SMC had $20.9 million in unrestricted cash on hand and $140 million drawn under its $500 million ABL Revolver with $359 million of borrowing availability, after accounting for $0.8 million of issued, but undrawn letters of credit. As of June 30, 2025, SMC's gross availability based on the borrowing base calculation in the credit agreement was $529 million, which is $29 million greater than the $500 million of lender commitments to the ABL Revolver. As of June 30, 2025, SMC was in compliance with all financial covenants, including interest coverage of 2.7x relative to a minimum interest coverage covenant of 2.0x and first lien leverage ratio of 0.5x relative to a maximum first lien leverage ratio of 2.5x. As of June 30, 2025, SMC reported a total leverage ratio of approximately 4.1x, excluding the potential earnout liability in connection with the Tall Oak Acquisition.
As of June 30, 2025, the Permian Transmission Credit Facility balance was $121.3 million, a reduction of $4.0 million relative to the March 31, 2025 balance of $125.3 million due to scheduled mandatory amortization. Summit Midstream Permian has $4.6 million of cash-on-hand as of June 30, 2025. The Permian Transmission Term Loan remains non-recourse to SMC.
MVC Shortfall Payments
SMC billed its customers $4.2 million in the second quarter of 2025 related to MVC shortfalls. For those customers that do not have MVC shortfall credit banking mechanisms in their gathering agreements, the MVC shortfall payments are accounted for as gathering revenue in the period in which they are earned. In the second quarter of 2025, SMC recognized $4.2 million of gathering revenue associated with MVC shortfall payments. SMC had $0.0 million of adjustments to MVC shortfall payments in the second quarter of 2025. SMC's MVC shortfall payment mechanisms contributed $4.2 million of total adjusted EBITDA in the second quarter of 2025.
Three Months Ended June 30, 2025
MVC Billings
Gathering revenue
Adjustments to MVC shortfall payments
Net impact to adjusted EBITDA
(In thousands)
Net change in deferred revenue related to MVC
shortfall payments:
Piceance Basin
$ ,
$ ,
$ ,
$ ,
Total net change
$ ,
$ ,
$ ,
$ ,
MVC shortfall payment adjustments:
Rockies
$ ,
$ ,
$ (9)
$ (9)
Piceance
4,219
4,219
—
$ 4,219
Northeast
—
—
—
—
Mid-Con
—
—
—
—
Total MVC shortfall payment adjustments
