Kinetik Holdings Expands Credit Facility, Extends Maturity

HOUSTON – Kinetik Holdings Inc. (NYSE:KNTK), a natural gas transmission company with a market capitalization of $8.39 billion, has amended its accounts receivable securitization facility, increasing the facility limit to $250 million and extending its termination date to March 31, 2026. This update, filed with the SEC today, also notes the removal of certain sustainability performance targets previously attached to the company. According to InvestingPro data, the company operates with a moderate level of debt, maintaining $3.54 billion in total debt.

On Monday, Kinetik Holdings LP, a subsidiary of Kinetik Holdings Inc., entered into an agreement to amend the original facility established on April 2, 2024. The amendment, known as Amendment No. 1 to the Receivables Purchase Agreement, was made with PNC Bank, National Association serving as the administrative agent.

The amended facility will provide Kinetik with additional financial flexibility by increasing the borrowing capacity from its accounts receivable. This move comes as InvestingPro analysis shows the company’s short-term obligations currently exceed its liquid assets, with a current ratio of 0.7. Additionally, Frontier Field Services, LLC has joined the agreement as an Originator, taking on the associated responsibilities. For deeper insights into Kinetik’s financial health and detailed analysis, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro.

The removal of certain sustainability performance targets from the agreement suggests a shift in the company’s financing conditions, though specifics were not disclosed in the filing. This move could reflect changes in the company’s operational strategy or in the broader market’s approach to sustainability-linked financing.

Investors may view this expansion of credit and extension of maturity favorably, as it could signal confidence from lenders in Kinetik’s financial health and business model. The company has demonstrated strong performance with revenue growth of 18.03% and EBITDA of $515.28 million in the last twelve months. The increased facility limit and extended timeline provide Kinetik with a more robust safety net for managing its cash flow and investing in its operations, while maintaining its attractive 6.01% dividend yield.

The details of the amendment and the joinder agreement with Frontier Field Services are disclosed in Exhibits 10.1 and 10.2 of the SEC filing, offering transparency into the transaction’s specifics.

Kinetik Holdings Inc., previously known as Altus Midstream Co and Kayne Anderson Acquisition Corp, is incorporated in Delaware and headquartered in Houston, Texas. The company specializes in natural gas transmission and is listed on the New York Stock Exchange under the ticker symbol KNTK. Based on InvestingPro’s Fair Value analysis, the stock currently appears slightly overvalued, with additional insights available through InvestingPro’s extensive metrics and expert analysis tools.

The information reported is based on a press release statement filed with the SEC.

In other recent news, Kinetik Holdings Inc. reported its fourth-quarter 2024 earnings, which fell short of analysts’ expectations. The company posted an earnings per share (EPS) of $0.01, significantly below the forecasted $0.48, and its revenue of $385.72 million also missed the expected $393.45 million. Despite this, Kinetik reported a 16% increase in full-year adjusted EBITDA, highlighting strong annual performance. In a separate development, Kinetik announced the pricing of a $250 million sustainability-linked senior notes offering, aimed at general corporate purposes, including debt repayment. Additionally, RBC Capital Markets adjusted its price target for Kinetik Holdings, reducing it from $67.00 to $63.00, but maintained an Outperform rating, citing the company’s strong positioning in the Permian Basin. Meanwhile, Kinetik experienced a change in its board of directors, with the resignation of board member Jesse Krynak, who left without citing any disagreements. These recent developments indicate a dynamic period for Kinetik Holdings as it navigates financial challenges and strategic shifts.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.