HESM · Hess Midstream LP

Hess Midstream LP delivered solid Q1 2026 results with net income of $157.7 million, slightly below prior-year $161.4 million, primarily due to lower throughput volumes from reduced production and new-well activity, offset by higher tariff rates, third-party services, and pass-through revenues which drove revenues up 2% to $390.1 million. Operating costs rose to $152.0 million from higher depreciation, while interest expense remained stable at $55.4 million. Attributable net income grew to $87.6 million or $0.68 per Class A share from $0.65, reflecting share repurchases. Adjusted EBITDA expanded 3% to $299.8 million, supported by operational efficiency. CEO Jonathan Stein highlighted execution on priorities, safe operations, and financial strategy, enabling capex reduction to $10.4 million from $50.1 million prior year after gas compression expansion completion. Throughput declined 5% in oil terminaling and 9% in water gathering due to lower production, but gas processing rose 1% from third-party volumes. The board raised the quarterly distribution by $0.0151 to $0.7792 per Class A share, backed by unit repurchases totaling $60 million, signaling commitment to shareholder returns. Updated 2026 guidance lowers capex to $105 million and boosts Adjusted FCF to $910-960 million due to capex savings and deferred taxes until after 2028 under new CAMT guidance, with ~$280 million FCF after distributions at midpoint for returns and debt paydown. Reaffirmed throughput, net income ($650-700M), and Adjusted EBITDA ($1,225-1,275M) guidance underscores stability in fee-based midstream assets serving Chevron and third parties in Bakken.