Julian Demoulin Smith

Julian Dumoulin-Smith asked about the composition of the 2027 CapEx guidance ($2-$2.5 billion), specifically how much is already committed and if new project announcements would be incremental. He also sought clarification on the 2027 EBITDA growth target and the future of the Bahia UJI with ExxonMobil.

Answer

Co-CEO Randy Fowler stated that the CapEx range includes projects not yet FID-ed, expecting to be at the higher end for 2026 and within the $2-$2.5 billion range for 2027. He confirmed the expectation of 10% EBITDA growth for 2027 over 2026, with modest growth for 2026 over 2025, and reiterated the seasonal strength of Q4/Q1. Justin Kleiderer, SVP of Pipelines & Terminals, confirmed the Bahia expansion is backed by ExxonMobil, with Exxon having connection rights and 12 downstream agreements strengthening the relationship.

Julian Demoulin Smith (via Clark Allen) inquired about the Texas House Bill 4384 benefits, specifically asking if the 60% distribution and 40% APT split of benefits would change meaningfully year over year given potential CapEx cadence differences. He also asked if the recent 15% dividend increase, driven by the HB 4384 uplift, should be viewed as a long-term guide up for the dividend.

Answer

President and CEO Kevin Akers stated that the 60/40 split of HB 4384 benefits is not expected to change meaningfully year over year due to the consistent and robust five-year planning process. Senior Vice President and CFO Chris Forsythe clarified that the 15% dividend increase was to rebase the dividend in line with the rebased EPS guidance, and the company intends to grow the dividend 6-8% over the next five years.

Julian Demoulin-Smith asked if the 60% distribution and 40% APT split of Texas House Bill 4384 benefits would change meaningfully year-over-year due to varying CapEx cadences. He also inquired if the recent dividend guide-up, driven by the durability of the HB 4384 uplift, should be viewed as a long-term guide-up.

Answer

Kevin Akers, President and CEO, stated that the company does not expect the 60/40 split of HB 4384 benefits to change meaningfully year-over-year, expressing confidence in the well-laid-out five-year plan. Chris Forsythe, Senior Vice President and Chief Financial Officer, clarified that the 15% dividend increase was to rebase it in line with the rebased EPS guidance, with an intention to grow the dividend 6-8% over the next five years.