Summit Midstream Corp (SMC)·Q4 2024 Earnings Summary

Executive Summary

• Q4 2024 adjusted EBITDA was $46.2M, in line with management’s prior Q3 guidance of $45–$50M; total revenues were $107.0M, and GAAP net loss was $24.8M with diluted EPS of $(2.40). Natural gas throughput rose 10.5% sequentially to 737 MMcf/d, while liquids volumes declined 2.9% to 68 Mbbl/d .
• 2025 guidance initiated: adjusted EBITDA of $245–$280M, capital expenditures of $65–$75M (including $15–$20M maintenance), and expected 125–185 well connections; management targets >$100M levered free cash flow at the midpoint to drive deleveraging toward 3.5x .
• Corporate actions: closed Tall Oak Midstream III acquisition (Dec 2, 2024), announced bolt-on Moonrise Midstream acquisition (Mar 10, 2025), and reinstated cash dividends on Series A preferred (Mar 15, 2025). Year-end total leverage was ~3.9x, pro forma for transactions .
• Key near-term stock catalysts: integration of Arkoma/Mid-Con assets and Moonrise capacity unlocking DJ Basin constraints; contractual step-ups on Double E take-or-pay volumes; narrative around returning capital as leverage trends to 3.5x .

What Went Well and What Went Wrong

What Went Well

• Natural gas throughput increased 10.5% QoQ to 737 MMcf/d; Double E averaged 613 MMcf/d and contributed $7.8M adjusted EBITDA net to SMC, supporting steady base performance .
• Strategic M&A executed: “The Moonrise transaction is both value- and credit- accretive… expands our operational capacity… we expect to generate over $260 million in adjusted EBITDA… [and] more than $100 million of levered free cash flow” (CEO Heath Deneke) .
• Mid-Con strength: adjusted EBITDA rose to $12.8M, +$5.6M QoQ, driven by Tall Oak’s December close, 27 Barnett wells, and the resumption of previously shut-in Barnett volumes; two rigs running with 15 DUCs .

What Went Wrong

• Liquids softness: Rockies liquids volumes fell 2.9% QoQ and Rockies segment EBITDA decreased by $1.6M QoQ due to lower water sales and natural production declines despite slight natural gas volume gains .
• Piceance moderation: segment EBITDA fell $1.0M QoQ on 2.5% lower throughput and higher opex; no new wells connected during the quarter .
• Elevated transaction costs weighed on GAAP results: Q4 included $17.8M in transaction costs and $2.9M loss on early extinguishment of debt, contributing to a GAAP net loss of $24.8M .

Financial Results

Consolidated P&L and Cash Metrics (Q2 → Q3 → Q4 2024)

Note: Q3’s GAAP loss was dominated by non-cash tax expense establishing deferred taxes with the C-Corp conversion .

Revenue Mix (Q2 → Q3 → Q4 2024)

Operating KPIs and Throughput (Q2 → Q3 → Q4 2024)

Segment Adjusted EBITDA

Note: Barnett was incorporated into Mid-Con following Tall Oak close in December 2024, driving the QoQ uplift in Mid-Con .

Capital Expenditures

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “At the mid-point of our 2025 financial guidance range we expect to generate over $260 million in adjusted EBITDA which translates to more than $100 million of levered free cash flow… to continue to de-lever the balance sheet towards our long term 3.5x leverage target.” — Heath Deneke, CEO .
• “We purchased [Moonrise] at approximately 5x 2024 EBITDA… adds 65 MMcf/d of processing capacity… we expect to extract significant operational and commercial synergies in ’25 and beyond.” — CEO prepared remarks .
• “Mid-Con… adjusted EBITDA totaled $12.8 million, an increase of $5.6 million… primarily due to the acquisition of Tall Oak Midstream III… and the resumption of production… in the Barnett.” — Press release .
• “Based on the midpoint of our guidance range, we expect to generate over $100 million of free cash flow available to pay down debt and trend toward our 3.5x leverage target.” — CFO remarks .

Q&A Highlights

• The published Q4 2024 transcript contains prepared remarks only, with no Q&A exchange captured; no additional guidance clarifications beyond prepared commentary were available in the transcript provided .

Estimates Context

• Wall Street consensus (S&P Global/Capital IQ) for Q4 2024 EPS, revenue and EBITDA was unavailable at request time due to data access limits; as a result, we cannot quantify beats/misses versus Street estimates in this recap. Values retrieved from S&P Global were unavailable due to daily limit errors.*

Key Takeaways for Investors

• Q4 execution was steady and in line with internal expectations, with adjusted EBITDA of $46.2M and stronger natural gas throughput; liquids softness and Piceance declines offset segment gains .
• Guidance implies 2025 inflection with $245–$280M adjusted EBITDA and >$100M levered free cash flow at midpoint; deleveraging to 3.5x remains the central capital allocation narrative .
• Strategic consolidation is the principal growth lever: Tall Oak boosts Mid-Con, Moonrise unlocks DJ capacity constraints and synergy capture potential starting in 2025 .
• Double E continues to provide durable underpinnings via take-or-pay contracts; near-term volume variability (613 MMcf/d in Q4 vs 661 MMcf/d in Q3) is balanced by contractual step-ups through 1H25 .
• Cash discipline evident: maintenance capex increased to $4.3M in Q4; total capex $15.8M focused on pad connections and optimization; MVC mechanisms contributed $5.44M to adjusted EBITDA in Q4 .
• Near-term trading lens: watch integration updates and rig/DUC conversion cadence, Rockies liquids trajectory, and any incremental guidance revisions amid commodity price shifts; re-rating may hinge on visible FCF-to-debt paydown pacing .
• Medium-term thesis: improved balance sheet and scalable footprint support continued bolt-on M&A and eventual common dividend potential after preferred reinstatement and leverage target attainment .

Citations:

• Q4 2024 press release and 8-K exhibit:
• Q4 2024 earnings call prepared remarks: and alternative transcript copy –
• Q3 2024 press release and call:
• Q2 2024 press release:
• Tall Oak Midstream III acquisition completed: