SOBO · South Bow Corporation

South Bow delivered stable Q1 2026 financial results amid geopolitical and market uncertainty, generating $491 million in revenue and $77 million net income ($0.37/share). Normalized EBITDA rose to $257 million, a $5 million increase from Q4 2025, primarily from stronger Marketing segment performance offsetting lower Keystone Pipeline contributions due to reduced maintenance. Distributable cash flow improved to $168 million, up $19 million quarter-over-quarter from lower current taxes, supporting $104 million in shareholder returns via a $0.50/share dividend. Operationally, Keystone Pipeline throughput averaged 616,000 bbl/d with a 95% SOF, and U.S. Gulf Coast segment hit 709,000 bbl/d, reflecting strong performance. The Blackrod Connection Project entered commercial service on time and budget, poised to add ~$10 million normalized EBITDA in 2026, with cash flows ramping in H2 2026 into 2027. Remedial work on the MP-171 incident progressed with 11 inspections and 76 digs completed. The Company reaffirmed its 2026 guidance of $1.03 billion normalized EBITDA (+/-2%), 90% secured by committed contracts minimizing price and volume risk, and expects Q2 normalized EBITDA slightly above Q1 levels from elevated U.S. Gulf Coast demand. Net debt stood at $4.7 billion with a 4.7x leverage ratio, expected to decline modestly through the year. An open season for the Prairie Connector project closed March 30, 2026, with results pending. This underscores South Bow's focus on reliable cash flows, infrastructure integrity, and disciplined capital allocation prioritizing sustainable dividends and investment-grade positioning.