Highlights
Third quarter 2025 net income of $5.0 million, adjusted EBITDA of $65.5 million, cash flow available for distributions ("Distributable Cash Flow" or "DCF") of $36.7 million and free cash flow ("FCF") of $16.7 million
Adjusted EBITDA increased by 7.2% from the second quarter of 2025, driven by higher natural gas volumes in the Rockies segment
Connected 21 wells during the third quarter and maintained an active customer base with five drilling rigs and more than 90 DUCs behind our systems
Double E Pipeline transported record volumes of 712 MMcf/d during the quarter and averaged 745 MMcf/d during September
Anticipate well connects to be near the midpoint of the company's full-year expectations, with 109 wells connected year-to-date and approximately 50 wells expected to be connected in the fourth quarter
Working closely with several customers on their 2026 development programs, with more than 120 new well connects expected in the first half of 2026
Management Commentary
Heath Deneke, President, Chief Executive Officer and Chairman, commented, "We had a solid third quarter with continued growth across our operating footprint. Adjusted EBITDA increased 7.2% from the prior quarter, representing approximately $260 million of run-rate adjusted EBITDA, driven by higher natural gas volumes in the Rockies region. We continue to see healthy customer activity with five rigs currently running behind our assets. In the Arkoma Basin, one of our key customers began drilling the 20-well program we discussed last quarter, which is expected to drive 5% to 10% volumetric growth next year. In the Rockies, natural gas volumes increased 7.5% quarter-over-quarter, averaging approximately 170 MMcf/d in September, supported by ongoing development from our core customers.
As we discussed in second quarter earnings, we continue to expect to finish the year near the low end of our original adjusted EBITDA guidance range of $245 million to $280 million, primarily due to timing delays of anticipated customer activity, however, we anticipate well connects to come in around the midpoint of our full-year expectations, with 109 wells connected year-to-date and approximately 50 wells expected to be connected in the fourth quarter. As we look ahead, we're encouraged by the level of customer engagement across our systems and the visibility we have into next year's activity. We are working closely with several customers on their 2026 development programs, with more than 120 new well connects expected in the first half of 2026. As customers finalize their budgets and full-year development plans, we believe additional wells in the second half of 2026 could drive total activity meaningfully higher. We will provide an update on activity levels and full-year 2026 financial guidance in our fourth quarter earnings release in March 2026."
Third Quarter 2025 Business Highlights
SMC's average daily natural gas throughput on its wholly owned operated systems increased 1.4% to 925 MMcf/d, while liquids volumes decreased 7.7% to 72 Mbbl/d, relative to the second quarter of 2025. Double E pipeline transported an average of 712 MMcf/d and contributed $8.7 million in adjusted EBITDA, net to SMC, for the third quarter of 2025.
Natural gas price-driven segments:
Natural gas price-driven segments generated $36.1 million in combined segment adjusted EBITDA, a 2.0% increase relative to the second quarter and combined capital expenditures of $13.8 million in the third quarter of 2025.
Mid-Con segment adjusted EBITDA totaled $23.6 million, a decrease of $1.3 million relative to the second quarter of 2025, primarily due to product margin partially offset by an increase in volume throughput on the system. Volume throughput on the system increased by 1.2% primarily due to six new well connections in the Arkoma and six new well connections in the Barnett, partially offset by natural production declines. Subsequent to quarter end, two new wells were connected in the Arkoma. There is currently one rig running in the Barnett and one in the Arkoma, with 18 DUCs behind the system, including 17 DUCs behind the Barnett, which are all expected to come online in 2026.
Piceance segment adjusted EBITDA totaled $12.5 million, an increase of $2.0 million relative to the second quarter of 2025, primarily due to realization of previously deferred revenue and lower operating expenses, partially offset by a 1.5% decrease in volume throughput. Further, Summit has successfully redeployed seven latent compressors from the Piceance and two from the DJ Basin to the Arkoma and has identified an additional three compressors to relocate in the next couple quarters. There were no new wells connected to the system during the quarter.
Oil price-driven segments:
Oil price-driven segments generated $37.7 million of combined segment adjusted EBITDA, representing a 12.3% increase relative to the second quarter of 2025, and had combined capital expenditures of $8.4 million.
Rockies segment adjusted EBITDA totaled $29.0 million, an increase of $3.8 million relative to the second quarter of 2025, primarily driven by higher natural gas volume throughput as wells connected during the first half of 2025 reached peak production and increased onloads from third-party systems, which resulted in increased fixed-fee revenue and improved product margin. Product margin also benefited from stronger realized NGL and condensate pricing, partially offset by lower realized residue gas prices. These gains were partially offset by a 7.7% decrease in liquids throughput. Nine new wells were connected during the quarter, including four in the DJ Basin and five in the Williston Basin. There are currently three rigs running and approximately 75 DUCs behind the system.
Permian segment adjusted EBITDA totaled $8.7 million, a 4.5% increase from the second quarter of 2025, primarily due to a 4.4% increase in volumes shipped on the Double E Pipeline leading to an increase in proportionate adjusted EBITDA from our Double E joint venture.
The following table presents average daily throughput by reportable segment for the periods indicated:
Three Months Ended September 30,
Nine Months Ended September 30,
2025
2024
2025
2024
Average daily throughput (MMcf/d):
Northeast (1)
—
—
—
269
Rockies
158
128
145
127
Piceance
259
284
263
295
Mid-Con
508
255
500
212
Aggregate average daily throughput
925
667
908
903
Average daily throughput (Mbbl/d):
Rockies
72
70
75
73
Aggregate average daily throughput
72
70
75
73
Ohio Gathering average daily throughput(MMcf/d) (2)
—
—
—
283
Double E average daily throughput (MMcf/d) (3)
712
661
686
559
_________
(1)
Exclusive of Ohio Gathering due to equity method accounting.
(2)
Gross basis, represents 100% of volume throughput for Ohio Gathering, subject to a one-month lag.
(3)
Gross basis, represents 100% of volume throughput for Double E.
The following table presents adjusted EBITDA by reportable segment for the periods indicated:
Three Months Ended September 30,
Nine Months Ended September 30,
2025
2024
2025
2024
(In thousands)
(In thousands)
Reportable segment adjusted EBITDA (1):
Northeast (2)
$ ,
$ ,
$ ,
$ 30,634
Rockies
28,999
24,850
79,103
70,582
Permian (3)
8,675
8,472
25,245
23,434
Piceance
12,509
12,831
34,769
40,912
Mid-Con
23,556
7,278
70,913
17,798
Total
$ 73,739
$ 53,431
$ 210,030
$ 183,360
Less: Corporate and Other (4)
8,241
8,193
25,932
24,915
Adjusted EBITDA (5)
$ 65,498
$ 45,238
$ 184,098
$ 158,445
__________
(1)
Segment adjusted EBITDA is a non-GAAP financial measure. We define segment adjusted EBITDA as total revenues less total costs and expenses, plus (i) other income (excluding interest income), (ii) our proportional adjusted EBITDA for equity method investees, (iii) depreciation and amortization, (iv) adjustments related to minimum volume commitments ("MVC") shortfall payments, (v) adjustments related to capital reimbursement activity, (vi) share-based and noncash compensation, (vii) impairments and (viii) other noncash expenses or losses, less other noncash income or gains.
(2)
Includes our proportional share of adjusted EBITDA for Ohio Gathering. Summit records financial results of its investment in Ohio Gathering on a one-month lag and is based on the financial information available to us during the reporting period. With the divestiture of Ohio Gathering in March 2024, proportional adjusted EBITDA includes financial results from December 1, 2023 through March 22, 2024. We define proportional adjusted EBITDA for our equity method investees as the product of (i) total revenues less total expenses, excluding impairments and other noncash income or expense items and (ii) amortization for deferred contract costs; multiplied by our ownership interest during the respective period.
(3)
Includes our proportional share of adjusted EBITDA for Double E. We define proportional adjusted EBITDA for our equity method investees as the product of total revenues less total expenses, excluding impairments and other noncash income or expense items; multiplied by our ownership interest during the respective period.
(4)
Corporate and Other represents those results that are not specifically attributable to a reportable segment or that have not been allocated to our reportable segments, including certain general and administrative expense items and transaction costs.
(5)
Adjusted EBITDA is a non-GAAP financial measure.
Capital Expenditures
Capital expenditures totaled $22.9 million in the third quarter of 2025, inclusive of maintenance capital expenditures of $5.3 million. Capital expenditures in the third quarter of 2025 were primarily related to pad connections in the Rockies and Mid-Con segments and compressor relocations from the Piceance to the Arkoma. Year-to-date capital expenditures include $9.5 million for Tall Oak Integration and compressor relocation projects and $4.2 million for the Williston optimization project.
Nine Months EndedSeptember 30,
2025
2024
(In thousands)
Cash paid for capital expenditures (1):
Northeast
$ ,
$ 2,980
Rockies
30,696
29,211
Piceance
1,531
2,278
Mid-Con
35,210
686
Total reportable segment capital expenditures
$ 67,437
$ 35,155
Corporate and Other
2,473
2,706
Total cash paid for capital expenditures
$ 69,910
$ 37,861
__________
(1)
Excludes cash paid for capital expenditures by Ohio Gathering and Double E due to equity method accounting.
Capital & Liquidity
As of September 30, 2025, SMC had $24.6 million in unrestricted cash on hand and $150 million drawn under its $500 million ABL Revolver with $349 million of borrowing availability, after accounting for $0.8 million of issued, but undrawn letters of credit. As of September 30, 2025, SMC's gross availability based on the borrowing base calculation in the credit agreement was $519 million, which is $19 million greater than the $500 million of lender commitments to the ABL Revolver. As of September 30, 2025, SMC was in compliance with all financial covenants, including interest coverage of 2.7x relative to a minimum interest coverage covenant of 2.0x and first lien leverage ratio of 0.6x relative to a maximum first lien leverage ratio of 2.5x. As of September 30, 2025, SMC reported a total leverage ratio of approximately 4.2x, including the potential earnout liability in connection with the Tall Oak Acquisition.
As of September 30, 2025, the Permian Transmission Credit Facility balance was $117.0 million, a reduction of $4.2 million relative to the June 30, 2025 balance of $121.2 million due to scheduled mandatory amortization. Summit Midstream Permian has $3.8 million of cash-on-hand as of September 30, 2025. The Permian Transmission Term Loan remains non-recourse to SMC.
MVC Shortfall Payments
SMC billed its customers $4.2 million in the third quarter of 2025 related to MVC shortfalls. For those customers that do not have MVC shortfall credit banking mechanisms in their gathering agreements, the MVC shortfall payments are accounted for as gathering revenue in the period in which they are earned. In the third quarter of 2025, SMC recognized $4.2 million of gathering revenue associated with MVC shortfall payments. SMC had $0.0 million of adjustments to MVC shortfall payments in the third quarter of 2025. SMC's MVC shortfall payment mechanisms contributed $4.2 million of total adjusted EBITDA in the third quarter of 2025.
Three Months Ended September 30, 2025
MVCBillings
Gathering revenue
Adjustmentsto MVC shortfall payments
Net impact to adjusted EBITDA
(In thousands)
Net change in deferred revenue related to MVC
shortfall payments:
Piceance Basin
$ ,
$ ,
$ ,
$ ,
Total net change
$ ,
$ ,
$ ,
$ ,
MVC shortfall payment adjustments:
Rockies
$ 2
$ 2
$ ,
$ 2
Piceance
4,192
4,192
—
$ 4,192
Northeast
—
—
—
—
Mid-Con
—
—
—
—
Total MVC shortfall payment adjustments
$ 4,194
$ 4,194
$ ,
$ 4,194
