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    DTM
    Earnings call· Jun 2026(Q2 FY26)

    DT Midstream Q2 FY26 earnings call DTM

    Jul 30, 2026 Source

    Executive summary

    DT Midstream Q2 FY26 — Strong Organic Growth and Backlog Commercialization

    DT Midstream delivered strong Q2 FY26 results, driven by robust organic growth and significant commercialization of its project backlog, particularly in pipeline infrastructure. The company is capitalizing on increasing demand from LNG, power generation, and data centers, reinforcing its confidence in the full-year outlook. Management highlighted the strategic positioning of its assets to serve growing natural gas demand across North America, with a focus on disciplined execution and customer needs.

    Highlights

    5

    • Commercialized 60% of the $3.4 billion organic project backlog, with over 80% committed to pipeline projects.

    • Reached Final Investment Decision (FID) on approximately $300 million of new organic growth projects.

    • Haynesville gathering volumes averaged 2.2 Bcf per day, an all-time record throughput for the system.

    • Balance sheet remains healthy with Moody's raising leverage downgrade threshold from 4.0x to 4.25x and Fitch from 4.0x to 4.5x.

    • Secured a 25-year renewal contract for capacity on the Midwestern pipeline, indicating strong asset value.

    Concerns

    3

    • Adjusted EBITDA for Q2 was $305 million, a $3 million decrease from the prior quarter.

    • Pipeline segment results were $14 million lower than the prior quarter.

    • Northeast gathering volumes are expected to be lower in Q3 due to timing of producer activity and maintenance across the gathering network.

    Guidance & targets

    5
    CategoryTargetConfidence
    Full-year 2026 Adjusted EBITDA
    Reaffirmed guidance range
    high materiality
    High
    Full-year 2027 Adjusted EBITDA
    Reaffirmed early outlook
    high materiality
    High
    Dividend growth
    In line with adjusted EBITDA
    medium materiality
    High
    Haynesville volumes Q3
    In line with Q2
    medium materiality
    High
    Northeast volumes Q3
    Lower than Q2
    medium materiality
    High

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    Pipeline
    Segment results were $14 million lower than the prior quarter, driven by seasonally lower revenues from joint venture pipelines and higher revenue on Stonewall.
    		——-$14M—
    Gathering
    Segment results were $11 million greater than the prior quarter, reflecting higher volumes on Blue Union.
    		——+$11M—

    Operational metrics

    16
    Adjusted EBITDA
    $305Mdown $3M QoQ
    Q2 FY26

    Adjusted EBITDA for the second quarter.

    Growth capital investment
    $86Min line with plan
    Q2 FY26

    Growth capital investment for the second quarter, with a ramp expected over the balance of the year.

    Committed capital
    ~$425M
    FY26

    New investments reaching FID increased committed capital for 2026.

    Committed capital
    ~$560M
    FY27

    New investments reaching FID increased committed capital for 2027.

    Leverage downgrade threshold (Moody's)
    4.25xup from 4.0x
    Current

    Moody's recently raised the leverage downgrade threshold.

    Leverage downgrade threshold (Fitch)
    4.5xup from 4.0x
    Current

    Fitch recently raised the leverage downgrade threshold.

    Dividend per share
    $0.88unchanged QoQ
    Q2 FY26

    Second quarter dividend approved by the Board of Directors.

    Haynesville gathering volumes
    2.2 Bcf per dayall-time record
    Q2 FY26

    Total gathering volumes for the Haynesville system.

    Northeast gathering volumes
    1.38 Bcf per day
    Q2 FY26

    Total gathering volumes for the Northeast system.

    Organic project backlog commercialized
    60%
    Q2 FY26

    Percentage of the organic project backlog that has been commercialized.

    LEAP pipeline capacity
    2.3 Bcf per dayincreased by 200 MMcf per day
    Future

    Total capacity of the LEAP pipeline after the announced expansion.

    Appalachia gathering system expansion
    100 MMcf per day
    Future

    Expansion of the Appalachia gathering system supported by a new long-term gathering agreement.

    NEXUS interconnect capacity
    380 MMcf per day
    Future

    New interconnect commercialized on NEXUS for a data center power facility.

    Total new demand on NEXUS mainline
    over 0.5 Bcf
    Future

    Total new demand pool added to the mainline of NEXUS from recent interconnects.

    North America pipeline infrastructure investment need
    $1T
    Next 25 years

    Study highlighting the significant need for new pipeline infrastructure to connect supply to growing demand centers.

    North America natural gas demand growth
    30-40 Bcf
    Next 20 years

    Estimated demand growth that will require all current basins to increase production.

    Industry KPIs

    5
    MetricValueDetails
    Pipeline throughput storage2.3 Bcf per dayBcf per day
    Sanctioned expansion backlog$3.4BUSD
    Basin level production volume2.2 Bcf per dayBcf per day
    FCF shareholder distributions$0.88USD per share
    Take or pay contract structure25 yearsyears

    Deals & partnerships

    2
    2 producer customersLong-term agreements supporting Haynesville system expansionlong-term

    New long-term agreements with two producer customers supporting the Haynesville system expansion, increasing LEAP capacity to 2.3 Bcf per day.

    Unnamed utilityNew interconnect on NEXUS for natural gas-fired power generation facility

    Commercialized a new interconnect on NEXUS to provide supply for a natural gas-fired power generation facility powering a new data center in Ohio.

    Capital programs

    3
    Haynesville System Expansion (LEAP)underway~$300M
    Start: Q2 FY26 (FID)

    Benefit: 200 MMcf per day incremental capacity, 2.3 Bcf per day total

    Expansion of the Haynesville system, increasing LEAP pipeline capacity, supported by new long-term agreements with 2 producer customers.

    Viking Modernization (Phase 1)underway~$300M
    Start: Q2 FY26 (FID)

    Benefit: Improved reliability for critical capacity serving Twin Cities, Minnesota

    First phase of modernization on the Viking pipeline, part of the $300M new organic growth projects.

    Appalachia Gathering System Expansionunderway
    Start: Q2 FY26 (agreement)

    Benefit: 100 MMcf per day expansion, delivering supply into NEXUS and Texas Eastern

    Expansion supported by a new long-term gathering agreement, reflecting growing producer activity.

    Risks & headwinds

    3
    Seasonally lower revenues from joint venture pipelinesQ2 FY26

    $14M decrease in Pipeline segment results QoQ

    Mitigation: Not explicitly stated, but part of normal seasonal fluctuations.

    Lower Northeast gathering volumesQ3 FY26

    Expected to be lower in Q3 FY26

    Mitigation: Due to timing of producer activity and maintenance across the gathering network; management expects Haynesville volumes to offset by being in line with Q2.

    Regulatory process for new projectsOngoing, 3-4 years for earliest in-service of large projects (early 2030s)

    Multi-year journey for large FERC projects (e.g., NEXUS took 7-8 years from concept to in-service)

    Mitigation: Company monitors and observes regulatory processes closely, as they are a derivative of this activity. Focus on strategic and patient approach.

    What to watch in Q3 FY26

    4

    Mist expansion commercialization progress

    Next quarter
    CurrentBinding precedent agreements advancing, first phase in-service as early as end of 2029
    TargetMore specific details on size, scope, and binding agreements

    Why it matters

    Mist is expected to be comparable to G3 in size and scale, representing a significant organic growth opportunity.

    I think we said in the past, and maybe I'll just reiterate it here is that from a size and scale perspective, I think we've always compared this to G3 is something similar in size and scale as G3.

    Q&A highlights

    6

    Can you elaborate on the commercialization process for Mist, its size and phasing, and how the competitive landscape is evolving?

    Management stated it's early to disclose specific size and scope but expects the first phase to be in service as early as end of 2029, driven by customer needs. They are advancing binding precedent agreements and are encouraged by ongoing customer discussions. The project is expected to be comparable to G3 in size and capital investment.

    “I think we said in the past, and maybe I'll just reiterate it here is that from a size and scale perspective, I think we've always compared this to G3 is something similar in size and scale as G3.”

    asked by Theresa Chen · answered by David Slater

    2 min read5 chapters

    Detailed Narrative

    01

    Organic Growth and Project Backlog Commercialization

    DT Midstream has commercialized 60% of its $3.4 billion organic project backlog, with over 80% of this committed to pipeline projects. The company reached FID on approximately $300 million of new organic growth projects this quarter, including a 200 MMcf per day expansion of the Haynesville system and the first phase of modernization on Viking. These projects are supported by long-term contracts and durable customer demand, reinforcing confidence in future growth.

    02

    Haynesville System Expansion and Performance

    The Haynesville system expansion will increase LEAP pipeline capacity by 200 MMcf per day to a total of 2.3 Bcf per day, supported by new long-term agreements with two producer customers, with an expected in-service date in H2 2028. This project enhances connectivity to East Texas supply and direct LNG market access. Operationally, Haynesville gathering volumes averaged an all-time record of 2.2 Bcf per day in Q2, demonstrating strong throughput.

    03

    Midwestern Pipeline and Data Center Demand

    The Midwestern pipeline is seeing significant demand, particularly from data centers and power generation. The company commercialized a new interconnect on NEXUS with 380 MMcf per day capacity to supply a natural gas-fired power generation facility for a new data center in Ohio. Management views Midwestern as the 'last mile' to load centers, benefiting from diverse supply sources like Vector, Alliance, REX, Texas Gas, and Tennessee Gas, making it attractive for customers seeking supply optionality.

    04

    Balance Sheet Strength and Capital Allocation

    DT Midstream maintains a healthy balance sheet, with Moody's raising its leverage downgrade threshold from 4.0x to 4.25x and Fitch from 4.0x to 4.5x. Growth capital investment for Q2 was $86 million, in line with plans, with an expected ramp in the second half⚖️ of the year. The company's committed capital for 2026 and 2027 has increased to approximately $425 million and $560 million, respectively, following new project FIDs. The Q2 dividend was approved at $0.88 per share, unchanged, with a commitment to grow it in line with adjusted EBITDA.

    05

    Long-Term Market Fundamentals and Infrastructure Needs

    The long-term outlook for natural gas infrastructure in North America remains highly constructive, driven by growing LNG and power demand, and the increasing need for reliable, affordable, and secure energy. An Inga Foundation study highlighted the need for over $1 trillion in new pipeline infrastructure investment over the next 25 years. Management anticipates significant incremental investments, including potential new pipelines, to connect future production from basins like Appalachia, Haynesville, and Permian to demand centers, with earliest in-service dates for large projects in the early 2030s.

    AI-generated summary of the company’s earnings call. Not investment advice.