Q4 2025 Antero Midstream Corp Earnings Call

February 12, 2026

Speaker #1: Greetings . Welcome to Antero Midstream Corp fourth quarter 2025 Earnings Call . At this time , all participants are in a listen only mode .

Speaker #1: A question and answer session will follow the formal presentation . If anyone should require operator assistance during the conference , please press Star Zero on your telephone keypad .

Speaker #1: Please note this conference is being recorded . Recorded . I will now turn the conference over to Dan Katzenberg , Director of Finance .

Speaker #1: Thank you . May begin

Speaker #2: Thank you for joining us for Antero Midstream Corp's fourth quarter investor conference call. We'll spend a few minutes going through the financial and operating highlights, and then we'll open it up for Q&A.

Dan Katzenberg: Thank you for joining us for Antero Midstream's fourth quarter investor conference call. We'll spend a few minutes going through the financial and operating highlights, and then we'll open it up for Q&A. I would also like to direct you to the homepage of our website at anteromidstream.com, where we have provided a separate earnings call presentation that will be reviewed during today's call. Today's call may also contain certain non-GAAP financial measures. Please refer to our earnings press release for important disclosures regarding such measures. Joining me on the call today are Michael Kennedy, CEO and President of Antero Midstream, Justin Agnew, CFO of Antero Midstream, and Brendan Krueger, CFO of Antero Resources. With that, I'll turn the call over to Mike.

Speaker #2: I would also like to direct you to the home page of our website at Antero Midstream Corp , where we have provided a separate earnings call presentation that will be reviewed during today's call .

Speaker #2: Today's call may also contain certain non-GAAP financial measures . Please refer to our earnings press release for important disclosures regarding such measures . Joining me on the call today are Michael Kennedy CEO and president of Antero Midstream Corp .

Speaker #2: Justin Agnew, CFO of Antero Midstream Corp, and Brendan Krueger, CFO of Antero Resources. With that, I'll turn the call over to Mike.

Speaker #2: Thanks , Dan .

Michael Kennedy: Thanks, Dan. Good morning, everyone. We recently closed the acquisition of HG Midstream for $1.1 billion. This bolt-on asset in the core of the Marcellus Shale adds over 400 highly economic undeveloped locations dedicated to Antero Midstream that immediately compete for development capital and infrastructure projects in 2026. This asset is a strategic fit in AM's portfolio and will follow our just-in-time capital investment strategy that generates consistent and repeatable free cash flow. Looking back at 2025, we generated EBITDA growth of 7% year-over-year, which marked our 11th consecutive year of growth since our IPO in 2014. Free cash flow after dividends increased by 30%, driven by capital-efficient organic growth and throughput from AR.

Speaker #3: Good morning everyone . We recently closed the acquisition of HG midstream for $1.1 billion . This bolt on asset in the core of the Marcellus Shale adds over 400 highly economic , undeveloped locations dedicated to Antero Midstream Corp that immediately compete for development , capital and infrastructure projects .

Speaker #3: In 2026 . This asset is a strategic fit in AMS portfolio and will follow our just in time capital investment strategy that generates consistent and repeatable free cash flow Looking back at 2025 , we generated EBITDA growth of 7% year over year , which marked our 11th consecutive year of growth since our IPO in 2014 .

Speaker #3: Free cash flow after dividends increased by 30% , driven by capital efficient organic growth and throughput from AR In 2026 is EBITDA and free cash flow growth continues as we expect , 8% year over year EBITDA growth and 11% year over year free cash flow growth Looking ahead further to 2027 , we expect another year of high single digit EBITDA growth as we realize the full benefits of the acquisition and synergies , including the integration of the water system and AR running a three rig due completion , crew development program on our dedicated acreage Justin will go into the details in his remarks , but the integrated water system , combined with our investment in dry gas assets , provides high visibility into growth at Am Importantly , we can achieve this growth with very modest capital budgets , which allows us to further expand our free cash flow after dividends in 2027 .

Michael Kennedy: In 2026, as the EBITDA and free cash flow growth continues, as we expect 8% year-over-year EBITDA growth and 11% year-over-year free cash flow growth. Looking ahead further to 2027, we expect another year of high single-digit EBITDA growth as we realize the full benefits of the acquisition and synergies, including the integration of the water system and AR, running a 3-rig new completion crew development program on our dedicated acreage. Justin will go into the details in his remarks, but the Antero Water System, combined with our investment in dry gas assets, provides high visibility into growth at AM. Importantly, we can achieve this growth with very modest capital budgets, which allows us to further expand our free cash flow after dividends in 2027. With that, I'll turn the call over to Justin.

Speaker #3: With that , I'll turn the call over to Justin . Thanks , Mike I'll start with our fourth quarter and full year highlights on slide number four .

Justin Agnew: Thanks, Mike. Start with our fourth quarter and full year highlights on slide 4. Adjusted EBITDA was $285 million during the quarter, which is a 4% increase year-over-year, driven by an increase in gathering and compression volumes. During the quarter, we generated $85 million of free cash flow after dividends, which we used to reduce leverage to 2.7 times and repurchase approximately $48 million of AM shares. For the full year, we generated a company record free cash flow after dividends of $325 million, which is a 30% increase compared to 2024. This free cash flow growth, driven by capital efficiencies from leveraging our existing assets, generated a 20% return on invested capital for ROIC in 2025. Now let's move on to slide 5, titled 2026 Capital Budget.

Speaker #3: Adjusted EBITDA was $285 million during the quarter , which was a 4% increase year over year , driven by an increase in gathering and compression volumes during the quarter .

Speaker #3: We generated $85 million of free cash flow after dividends, which we used to reduce leverage to 2.7 times and repurchase approximately $48 million of shares for the full year.

Speaker #3: We generated a company record free cash flow after dividends of $325 million , which is a 30% increase compared to 2024 . This free cash flow growth , driven by capital efficiencies from leveraging our existing assets , generated a 20% return on invested capital for ROIC in 2025 .

Speaker #3: Now , let's move on to slide number five , titled 2026 Capital Budget In 2026 , we have budgeted a capital investment of 190 to $220 million .

Justin Agnew: In 2026, we have budgeted a capital investment of $190 to 220 million. The capital budget includes our blocking and tackling well connect and water capital, construction and relocation of compression assets, high pressure gathering trunk lines, and capital to integrate the water systems. It also includes expansion capital on the dry gas portion of the acreage to enhance downstream deliverability to multiple long-haul pipelines. These projects will unlock significant optionality and improve reliability in the dry gas regime that we don't currently have today. I'll finish my comments on slide number 6, titled 2026 Guidance and Outlook. This guidance includes the impact of the acquisition and divestiture, with contributions to guidance based on closing dates of each transaction.

Speaker #3: The capital budget includes our blocking and tackling well , connect and water capital construction and relocation of compression assets , high pressure gathering , trunk lines and capital to integrate the water systems .

Speaker #3: It also includes expansion capital on the dry gas portion of the acreage to enhance downstream deliverability to multiple long haul pipelines . These projects will unlock significant optionality and improve reliability in the dry gas regime that we don't currently have today , I'll finish my comments on slide number six , titled 2026 Guidance and Outlook .

Speaker #3: This guidance includes the impact of the acquisition and divestiture with contributions to guidance based on closing dates of each transaction for 2026 . We are forecasting adjusted EBITDA of over $1.2 billion at the midpoint , or an 8% increase year over year , as Mike mentioned , after we finished the integration of the acquired water assets in 2026 , we expect further growth in the water business in 2027 .

Justin Agnew: For 2026, we are forecasting Adjusted EBITDA of over $1.2 billion from this point, or an 8% increase year-over-year. As Mike mentioned, after we finish the integration of the acquired water assets in 2026, we expect further growth in the water business in 2027 as we begin servicing locations on HG-acquired acreage. After interest, a capital budget of $190 to 220 million, and an attractive $0.90 per share dividend, we are forecasting to generate Free Cash Flow After Dividends of $360 million, or an 11% increase compared to 2025. Consistent with our historical approach, we expect a balanced return of capital program in 2026 in the form of debt reduction and share repurchases.

Speaker #3: As we begin servicing locations on acquired acreage after interest, a capital budget of $190 to $220 million and an attractive $0.90 per share dividend.

Speaker #3: We are forecasting to generate free cash flow after dividends of $360 million , or an 11% increase , compared to 2025 , consistent with our historical approach , we expect a balanced return of capital programme in 2026 .

Speaker #3: In the form of debt reduction and share repurchases. This allows us to maintain a strong balance sheet with leverage in the low three times range, core to AM strategy.

Justin Agnew: This allows us to maintain a strong balance sheet with leverage in the low 3x range. Core to AM strategy, the recent acquisition highlights the benefit of lower leverage and debt reduction, which allowed us to flex the balance sheet for the HG acquisition. This improves after-tax accretion, and more importantly, allows the value to accrete to our existing shareholders without the need for equity financing. In summary, we expect 2026 to be yet another year of EBITDA expansion, high capital efficiency, and most importantly, double-digit free cash flow growth. Our organic growth, growth strategy, coupled with a highly accretive acquisition that is fully financed, positions us well to build upon the momentum created in 2025. With that, operator, we are ready to take questions.

Speaker #3: The recent acquisition highlights the benefit of lower leverage and debt reduction, which allowed us to flex the balance sheet for the HG acquisition.

Speaker #3: This improves after-tax accretion and, more importantly, allows the value to accrete to our existing shareholders without the need for equity financing.

Speaker #3: In summary , we expect 2026 to be yet another year of EBITDA expansion . High capital efficiency and most importantly , double digit free cash flow growth .

Speaker #3: Our organic growth growth strategy , coupled with a highly accretive acquisition that is fully financed , positions us well to build upon momentum Created in 2025 .

Speaker #3: With that, operator, we are ready to take questions.

Speaker #1: Thank you . If you would like to ask a question , please press star One on your telephone keypad . A confirmation tone will indicate your line is in the question queue .

Operator: Thank you. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. And for participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment while we pull for questions. Our first question is from John McKay with Goldman Sachs. Please proceed.

Speaker #1: You may press star two if you would like to remove your question from the queue. And for participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment while we poll for questions. Our first question is from John McKay with Goldman Sachs.

Speaker #1: Please proceed

Speaker #4: Hey, good morning, guys. Thank you for the time. I want to start on growth outlook. I want to understand '26 and '27.

John Mackay: Hey, good morning, guys. Thank you for the time. I want to start on, on the growth outlook. I understand 26 and 27 have some, you know, tailwinds from M&A in the headline numbers. Can you just walk us through a little bit what the kind of longer-term growth trajectory looks like? Let's say, you know, once, once the assets are kind of fully up and running, if you guys are running a three rig and two crew program.

John MacKay: Hey, good morning, guys. Thank you for the time. I want to start on, on the growth outlook. I understand 26 and 27 have some, you know, tailwinds from M&A in the headline numbers. Can you just walk us through a little bit what the kind of longer-term growth trajectory looks like? Let's say, you know, once, once the assets are kind of fully up and running, if you guys are running a three rig and two crew program.

Speaker #4: Have some , you tailwinds from M&A in the headline numbers . Can you just walk us through a little bit what the kind of longer term growth trajectory looks like .

Speaker #4: Let's say you know once once the assets are kind of fully up and running , if you guys are running a three rig and two crew program .

Speaker #3: Yeah .

Speaker #5: John , good question . That three rig , two rig program does provide continued growth even past 27 . It's about a couple hundred million a day of growth on throughput volume .

Justin Agnew: Yeah, John, good question. That three rig, two rig program does provide continued growth even past 2027. It's about a couple hundred million a day of growth on through click volume, so expect that to continue. So I think you'd still be in the mid to high single digit EBITDA growth like we've experienced over our, our time, our last 11 years, and we'll have in 2025 and 2026. I think that's pretty fair to have us generate those type of growth in 2027 and beyond.

Speaker #5: So expect that to continue. So, I think you'd still be in the mid- to high-single-digit EBITDA growth, like we experienced over our time.

Speaker #5: Our last 11 years. And we'll have in '25 and '26. I think that's pretty fair to have us generate those types of growth in '27 and beyond.

Speaker #4: That's clear . Appreciate it . And then , you know , on the AR side , you guys were talking about some growth upside plans .

John MacKay: That's clear. Appreciate it. And then, you know, on the AR side, you guys were talking about some growth upside plans. Can you just walk-- and, you, you gave the color on the AR call, but maybe just again, like walk us through the thought process there and then what that means for AM, both from an EBITDA growth standpoint, but also a capital standpoint, if you move to that higher potential target.

John Mackay: That's clear. Appreciate it. And then, you know, on the AR side, you guys were talking about some growth upside plans. Can you just walk-- and, you, you gave the color on the AR call, but maybe just again, like walk us through the thought process there and then what that means for AM, both from an EBITDA growth standpoint, but also a capital standpoint, if you move to that higher potential target.

Speaker #4: Could you just walk and you gave the color on the AR call . But maybe just again walk us through the thought process there .

Speaker #4: And then what that means for AM, both from an EBITDA growth standpoint, but also a capital standpoint. If you move to that higher potential target.

Speaker #5: Yeah, that's a great thing about it. There's really no capital for AM outside of what we just outlined. Justin did.

Justin Agnew: Yeah, that's a great thing about it. There's really no capital for AM outside of what we just outlined, Justin did. It's right in the heart of our field. We already have all the big trunk lines. We have whatever pipelines are necessary. We have the water. A lot of this is dry gas, so it doesn't need further processing. So really, really nothing different than these capital budgets that we've experienced over the past couple of years for AM. For AR, AR is well positioned, partly because of AM, but also because of firm transport optionality around dry gas being in the right part of the country, but also having the ability to transport our gas to the Gulf Coast for the LNG. So a lot of different demand centers coming AR's way.

Speaker #5: It's right in the heart of our field . We already have all the big trunk lines . We have whatever pipelines are necessary .

Speaker #5: We have the water . A lot of this is dry gas . So it doesn't need a further processing . So really , really nothing different than these capital budgets that we've experienced over the past couple of years for Am AR , AR is well positioned partly because of Am , but also because of firm transport .

Speaker #5: Optionality around dry gas being in the right part of the country, but also having the ability to transport our gas to the Gulf Coast for the LNG.

Speaker #5: So a lot of different demand centers coming Ars way . So AR is the the likely company in most well positioned to meet the growing demand over the next five , ten years .

Justin Agnew: So AR is the likely company and most well-positioned to meet the growing demand over the next 5, 10 years.

Speaker #4: All right . That's clear . Appreciate the time .

John Mackay: All right, that's clear. Appreciate the time.

John MacKay: All right, that's clear. Appreciate the time.

Speaker #6: Yep

Justin Agnew: Yep.

Speaker #1: There are no further questions at this time. I would like to turn the conference back over to Dan for closing remarks.

Operator: There are no further questions at this time. I would like to turn the conference back over to Dan for closing remarks.

Speaker #2: Thank you , everyone for joining us on the call today . Please reach out with any questions that you have . Have a good day .

Dan Katzenberg: Thank you, everyone, for joining us on the call today. Please reach out with any questions that you have. Have a good day.

Operator: Thank you. This will conclude today's conference. You may disconnect your lines at this time.

Q4 2025 Antero Midstream Corp Earnings Call

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