Equitrans Midstream Corporation

For full-year 2023, Equitrans reported net income attributable to common shareholders of approximately $387 million, or $0.89 per diluted share; net income of $455 million; adjusted EBITDA of $1,056 million; deferred revenue of $329 million; net cash from operating activities of approximately $1 billion; and free cash flow of negative $129 million. For Q4 2023, it reported net income attributable to common shareholders of $134 million, or $0.31 per diluted share; net income of $150 million; adjusted EBITDA of $272 million; deferred revenue of $88 million; net cash from operating activities of $291 million; and free cash flow of negative $241 million. On a year-over-year basis, operating revenue for the full year increased by $36 million, and Q4 operating revenue increased by $5.4 million. For 2024, management guided to net income of $375 million to $455 million, adjusted EBITDA of $1.235 billion to $1.315 billion, deferred revenue of about $145 million, CapEx and capital contributions of $850 million to $955 million, free cash flow of negative $65 million to negative $145 million, and retained free cash flow of negative $325 million to negative $405 million. MVP is now targeted for Q2 2024 at an estimated total project cost of approximately $7.57 billion to approximately $7.63 billion.

Diana Charletta emphasized that the company’s main priority is safely bringing MVP into service, with close attention to environmental protocols and permitting compliance. She said the company is seeing better productivity as weather improved, and that the remaining work scope is narrowing, with April expected to be mostly commissioning work that is less weather-sensitive. Her tone was confident but cautious, acknowledging that the last tasks are among the most difficult on the project.

Kirk Oliver led with the reported financial results and adjusted for several items including the Rager Mountain storage incident, a water contract asset write-down, and derivative impacts tied to EQT-related cash payments. He highlighted 2023 adjusted EBITDA of $1,056 million, operating cash flow of about $1 billion, and free cash flow of negative $129 million, then guided 2024 to adjusted EBITDA of $1.235 billion to $1.315 billion and CapEx/capital contributions of $850 million to $955 million. On capital allocation, he said there are no current plans to change the dividend and that project-level MVP financing should drive a major debt reduction of roughly $800 million to $1 billion, with the possibility of more if markets allow.

Analysts focused on MVP timing, the new cost range, leverage, and whether the dividend could be reduced to preserve cash. Management said the June 1 / Q2 timing remains their current view, that permits are still in good standing, and that the weather-driven delays have mainly affected productivity rather than compliance. On leverage, Kirk said the amended revolver covenant was raised to 6.0x for Q1 and 6.25x for Q2, then steps back down, and management framed that as extra cushion rather than a sign of financing stress. They also said Southgate’s revised scope lowers permitting risk, though permits will still need to be filed later.