Q2 2025 Antero Midstream Corp Earnings Call

Spend a second on how you think about allocating to the buyback versus the balance sheet, and is that 50% number still kind of the right ballpark?

Yeah, I mean, I think we think about that 50% in in probably longer term numbers. So, you know, when we're giving those those comments, it's it's over, you know, a full year period, not kind of quarter to quarter a year, um, you know, the first quarter. We had some working capital headwinds so, you know, did not pay as much debt down in that first quarter. And then you saw in the second quarter, we did pay a substantial amount of debt down, um, and then as you as you as you hit on in July, we certainly stepped up on the uh, on the buyback there. So I would say it really does have and flow and and we try to be opportunistic in those share repurchases. And, uh, you know, it can be more aggressive at times. We see more value in the shares. Um, I think for for am we we continue to see a lot of value in the, in the share buyback. Um, and, and we also see the, you know, the value of paying down debt at growing to the equity as well. I think we're the lowest levered uh, Midstream name in the space. And, you know, we think that Debt Pay down does acrew to the equity. Still. As we look at that. Uh, today. So um, we'll continue to uh,

Look at both opportunities and and and it'll change quarter to quarter.

All right, that's clear. Thank you. Appreciate the time.

Thank you. Our next questions come from the line of Jeremy Tonette with Jan. Please proceed with your questions.

Hi, good morning.

Um, just wanted to dig in maybe a little bit more, if it could with regards to in-base and demand opportunities and there's been, you know, some some announcements recently, uh, you know, at the Pennsylvania energy and Innovation Summit. Uh, I think there's also been, uh, you know, some announcements out of, uh, you know, meta with the New Albany, um, facility. And was just wondering, you know, related to these recent developments, I guess, DC opportunities emerging specific to, to am here over time.

Yeah, I think, you know, we, we talked a little bit about in the first question there. Um, you know, West Virginia in particular, as we, where we have our significant, uh, asset base for am. Um, West Virginia recently did pass this micro Grid bill, um, where, you know, if you supply 70% of the power, uh, to a data center, uh, you're essentially you kind of skip the line. Um, so a lot of benefits, uh, if you can, if you can fall under that micro Grid bill, um, and I think it's mentioned in the previous question for for am, you know, I think there's really 2 ways that am plays a role, you know, the extent are uh, accelerates production to meet that specific demand.

Am, of course gets the benefit of of, you know, the water, the low pressure, the compression, the high pressure fees um and then the second piece is, of course, if am participates in building out infrastructure, uh, for the supply, um, am would would, would then earn a fee with potential third party on building that, that infrastructure out. So I think I'd probably communicate what we did on the are call, which is, you know, having lots of conversations. We've got a team internally working it, um, but no no timeline. And in terms of, you know, when, when, if any announcements, um, could be made or, you know, we're trying to go through this thoughtfully. And to the extent, something makes sense for the, uh, for the company will come out with it. But otherwise uh, no no plans in the medium term, intermediate term.

Got it. Understood um maybe just pivoting here to the Clear Water facility lawsuit. I don't know if there's any uh color you could shed on on timeline at this point from a, a legal proceeding standing.

No, unfortunately not. I think that nothing has changed from what we've put in our disclosure. They appealed to the Colorado Supreme Court, and we're just waiting on the Colorado Supreme Court to come out with any sort of decision in terms of whether they take it or not. But no change from that standpoint.

Got it, makes sense. I'll leave it there. Thank you.

Thanks. Thanks.

Thank you, as a reminder, if you would like to ask a question, please press star 1 on your telephone keypad.

Our next questions come from the line of Ned, Baraf with Wells Fargo. Please proceed with your questions.

Hi. Thanks for for taking the questions. Um,

Processing volumes picked up well above capacity in the second quarter.

I would imagine utilization will increase even

further from here. Could you maybe talk about the threshold above name plate? That would potentially trigger a decision to add another processing plant at the JV. It seems that running 5 to 10% above name plate, is not really a trigger, but just curious at what utilization levels, uh, you, you would have to make that decision.

Yeah, I think there's still some room. There you. You could typically run these about 10% over over name plates. So, you know, at the 1 6 related to the JV, um, you know, you'd be 160 over named plates so you've got another 80 or 90, uh, still above that. Um, so uh, no, no imminent, uh, needs, uh, increase processing capacity, and I think it was was talked about in the r call. There's also, you know, pads, uh, that get layered in over the next couple of years that are leaner as well. Um, so, you know, you'd expect that to stay in that in a similar ballpark as you look forward here.

Understood. Quick question on cash taxes. The earnings press release indicated an expected reversal of cash taxes paid here to date in the second half of the year. Could you maybe talk about your cash tax expectations? Longer term, when do you think Antero Midstream will be a full cash taxpayer?

Yeah. You know as as we look out, at least over the 5 years we're not expecting to be a full cash taxpayer. And I think as as I mentioned in in prepared remarks, um, do not expect to be a material. Cash taxpayer through at least 2028, um, and then we'll see see after that. But, uh, you know that the bill overall was was favorable for, for am in the sense. It reduced at least next 5 years by about 150 million in terms of, uh, deferred taxes. So a nice benefit of uh, of getting that bill passed.

Understood, thank you.

Thank you.

Thank you. Our next question is come from the line of Wade, Suki, with capital 1. Please proceed with your questions.

Good morning everyone. Thank you for, uh, taking my questions just wondering if you might be able to speak to a sort of inorganic opportunities, what you're seeing in the asset Market out, there any color you could give would be great. Thank you.

Yeah, good question. You know, when

You some bolt-on Acquisitions. And we've completed over the last several years. Um, you know, those, uh, we'll continue to look at opportunities like that where there's bolt-on opportunities in in in and around. Um, our current asset base, uh, nothing uh, you know, immediate to talk about there. But we're always looking at uh, opportunities there.

Great. Thank you so much. Appreciate it.

Thanks.

Thank you. This is now concludes our question and answer session. I would now like to turn the floor back over to Justin at new for any closing comments.

Thanks operator. And thanks to everybody for joining today's conference. Call please feel free to reach out with any follow-up questions.

Thank you. This does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of your day.