Dt Midstream, Inc. · NYSE:DTM
Dt Midstream — Investor Presentation (March 2022)
32 slides from Dt Midstream's investor presentation, Mar 1, 2022
Slide 1: Company Presentation February 2022
Company Presentation February 2022
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains statements which, to the extent they are not statements of historical or present fact, constitute "forward-looking statements" under the securities laws. These forward-looking statements are intended to provide management's current expectations or pla
Slide 3: Safe Harbor Statement
Safe Harbor Statement This presentation contains statements which, to the extent they are not statements of historical or present fact, constitute "forward-looking statements" under the securities laws. These forward-looking statements are intended to provide management's current expectations or pla
Slide 4: Integrated assets in world class basins
Integrated assets in world class basins
Slide 5: Integrated platform in the leading dry gas formations serving growing demand markets
Integrated platform in the leading dry gas formations serving growing demand markets Pipeline segment connects world-class basins to high-quality markets ~900 miles of FERC-regulated interstate pipelines that have interconnections with multiple interstate pipelines and LDCs Gas storage assets with 9
Slide 6: Diversified earnings contributions from the best dry gas basins and strong markets
Diversified earnings contributions from the best dry gas basins and strong markets 2021 adjusted EBITDA1 by segment 53% 47% Pipeline Gathering 2021 adjusted EBITDA by demand area 34% 7% 40% 19% Gulf Coast Midwest Eastern Canada Northeast & Mid-Atlantic 2021 gathering adjusted EBITDA by supply area 4
Slide 7: Key demand markets feature positive long-term growth outlooks
Key demand markets feature positive long-term growth outlooks Growing and stable demand across diverse set of markets Gulf coast demand is driven by robust LNG exports and industrial sector growth Growth in the Midwest is driven by gas-fired power generation and industrial load Stable demand in the
Slide 8: Appalachia and the Haynesville expected to supply half of US gas by 2035
Currently the most active dry gas basins, Appalachia and the Haynesville, are expected to supply half of US gas by 2035 US Lower 48 Supply Forecast, (Bcf/d) 120 110 90 80 70 60 50 40 30 20 10 0 2020 2025 2030 2035 % of 2035 Total Supply ~27% ~23% ~17% ~7% ~26% DTM basins ~50% of anticipated US suppl
Slide 9: Haynesville production and area LNG exports are both at historic highs
Haynesville production and area LNG exports are both at historic highs Haynesville production (Bcf/d) 16 14 12 10 8 6 4 2 0 2011 2013 2015 2017 2019 2021 53 rigs currently running - most among dry gas basins1 US LNG export feedgas (Bcf/d) ~12.7 Bcf/d 2022 peak (Bcf/d) 14 12 10 8 6 4 2 0 2016 2017 20
Slide 10: Haynesville "wellhead to water" system expansion connects supply with global demand
Phase 1 Haynesville "wellhead to water" system expansion connects highly economic supply with growing global demand Strong fundamentals around our Haynesville system have yielded new contracted expansions Phase 1 Expansion agreements executed with largest Haynesville producer, Southwestern Energy 50
Slide 11: Predictable cash flows supported by strong balance sheet
Predictable cash flows supported by strong balance sheet
Slide 12: Consistent track record of successful organic development and acquisitions
Consistent track record of successful organic development and acquisitions Historical adjusted EBITDA1 growth (millions) ~20% CAGR $82 $768 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Asset growth timeline Washington 10 expansion Millennium Pipeline in-service Vector phase
Slide 13: Growing and durable business that is positioned for today and the future
Growing and durable business that is positioned for today and the future Well balanced business mix 53% 47% 2021 Adjusted EBITDA 1 Pipeline Gathering 4% increase in pipeline segment contribution since 2020 Portfolio durability 100% natural gas focused ~90% of 2021 total contribution 2 is from MVC/De
Slide 14: Increased 2022 guidance provides 8% growth
Increased 2022 guidance provides 8% growth Positioned to deliver strong organic growth in 2022 Leveraging well positioned asset platforms in the Haynesville and Appalachia Strong growth in pipeline segment Long-term contracted cash flows Offsetting first full-year of public company costs 3 Adjusted
Slide 15: Strengthening total shareholder returns with 7% dividend increase
Strengthening total shareholder returns with 7% dividend increase Annualized dividend ($/share) +7% $2.40 $2.56 2021 2022 Quarterly dividend $0.60 $0.64 Long-term contracted cash flow generation supports durable and growing dividend Board approved increased dividend of $0.64 / share for Q1 2022 ~2.4
Slide 16: Strong asset platforms are expected to deliver 5% - 7% growth into 2023
Strong asset platforms are expected to deliver 5% - 7% growth into 2023 Well positioned asset platforms in premier dry gas basins will continue to drive growth Investing in growth opportunities in both the Haynesville and Appalachia Strong growth across both segments Expansion projects with long-ter
Slide 17: Maximizing total shareholder return via our strong cash flow generation
Maximizing total shareholder return via our strong cash flow generation Distributable cash flow 1 (millions) $575 - $625 2022 guidance Value creation Highly accretive growth projects Substantial set of organic projects at favorable build multiples Return capital to shareholders Increasing dividend w
Slide 18: Solidifying our 5-year growth investment plan through highly accretive organic projects
Solidifying our 5-year growth investment plan through highly accretive organic projects 2022 capital investments (millions) $350 - $400 $30 - $40 $320 - $360 2022 guidance Growth capital 1 Maintenance capital Completed or contracted growth investments Project In-service date(s) Pipeline Vector Blue
Slide 19: Our well positioned assets provide robust organic growth opportunities
Our well positioned assets provide robust organic growth opportunities Pipeline Platform Region 2022/2023 commercial focus LEAP Lateral NEXUS Pipeline Millennium Pipeline Haynesville Appalachia Appalachia We remain in active discussions with multiple counterparties for a phase 2 expansion Open seaso
Slide 20: Underpinned by long-term, fee-based contracts
Underpinned by long-term, fee-based contracts ~90% of total contribution 1 is from minimum volume commitments (MVC) / demand charges (take-or-pay) and currently flowing gas 2 Average contract tenor of ~9 years Majority of producers flowing at or above MVC levels Solid and improving customer credit p
Slide 21: Growth supported by stable cash flows and strong balance sheet
Growth is supported by highly stable cash flows backed by long-term fee-based contracts with strong customers Financial strength is supported by strong balance sheet with no significant debt maturities for six years Maintaining flexible, well-capitalized balance sheet Continuously monitoring market
Slide 22: Financial policy overview
Financial policy overview Self-funded investment program $1.2 - $1.7 billion Growth investment range from 2021 - 2025 is driven by organic opportunities within existing platforms Industry leading organic growth 7% - 9% growth 2021 adjusted EBITDA1 original guidance to 2022 adjusted EBITDA guidance D
Slide 23: Mature environmental, social and governance leadership
Mature environmental, social and governance leadership
Slide 24: Leading the industry with a mature environmental, social and governance program
Leading the industry with a mature environmental, social and governance program Environmental Targeting net zero greenhouse gas emissions by 2050 and a 30% reduction by 2030 Continuing to advance CCS opportunity in Louisiana Advancing hydrogen development opportunities with strategic partnership Exe
Slide 25: Executing on our plan to be net zero by 2050
Executing on our plan to be net zero by 2050 Currently executing - Carbon capture and sequestration - Electric compression - Renewable natural gas connections Opportunities being evaluated - Methane reducing technologies (e.g., vent control devices, electrical glycol pumps, instrument air system) -
Slide 26: Committed to strong governance practices
Committed to strong governance practices Best-in-class governance practices Structured as C-Corp with separate CEO and Executive Chairman Long-term incentive plans tied to total shareholder return targets Board committee focused on ESG initiatives Broad range of experience and diversity Financial an
Slide 27: Focusing on the diversity, safety, well-being and success of our employees, customers and communities
Focusing on the diversity, safety, well-being and success of our employees, customers and communities Embodying a strong safety culture Safety culture is built on empowerment, training, process safety, proactive risk mitigation and maintaining high safety standards Serving our communities Establishe
Slide 28: Clean assets, clean balance sheet, clean story
Clean assets, clean balance sheet, clean story DT Midstream Integrated assets in premier dry gas basins serving key markets Stable balance sheet with low leverage Predictable, robust contracted cash flows Mature environmental, social and governance leadership 28
Slide 29: Appendix
Appendix ~~ EW @ Midstream
Slide 30: Adjusted EBITDA and distributable cash flow (DCF) are non-GAAP measures
Adjusted EBITDA and distributable cash flow (DCF) are non-GAAP measures Adjusted EBITDA is defined as GAAP net income attributable to DT Midstream before expenses for interest, taxes, depreciation and amortization, further adjusted to include our proportional share of net income from our equity meth
Slide 31: Operating earnings is a non-GAAP measure
Operating earnings is a non-GAAP measure Use of Operating Earnings Information - Operating earnings exclude non-recurring items, certain mark-to-market adjustments and discontinued operations. DT Midstream management believes that operating earnings provide a more meaningful representation of the co
Slide 32: Reconciliation of net income attributable to DT Midstream to Adjusted EBITDA
Reconciliation of net income attributable to DT Midstream to Adjusted EBITDA (millions) 2008 2021 Net income attributable to DT Midstream $ 38 $307 Plus: Interest expense 7 112 Plus: Income tax expense 24 104 Plus: Depreciation and amortization 5 166 Plus: EBTDA from equity method investees1 31 174