Excelerate Energy, Inc. 2026 Q2 Earnings Call

Thank you for joining Excelerate Energy's second quarter 2026 earnings call. Joining me today are Steven Kobos, President and CEO, and Dana Armstrong, Chief Financial Officer. Also joining the call are Oliver Simpson, Chief Commercial Officer, and David Liner, Chief Operating Officer. Our second quarter earnings press release and presentation were published yesterday afternoon and are available on our website at ir.excelerateenergy.com. Before we begin, please note that today's discussion will include forward-looking statements which involve risks and uncertainties that may cause actual results to differ materially. We undertake no obligation to update these statements. We will also reference certain non-GAAP financial measures. Reconciliations to the most directly comparable GAAP measures can be found at the end of the presentation. With that, it is my pleasure to pass the call over to Steven Kobos.

Good morning, everyone. Thank you for joining us. This was a strong quarter for Excelerate, both financially and operationally. We delivered $120 million of adjusted EBITDA and advanced a number of commercial opportunities that support our growth outlook for the years ahead. Before I get into the quarter, let me start with what drives this business. We connect global LNG supply to the markets that need it most, and we own and operate an energy infrastructure portfolio that turns imported LNG into reliable, affordable energy. The backdrop for that work has never been stronger. An unprecedented wave of new LNG supply will come online by the end of this decade. That creates a significant opportunity for the downstream infrastructure required to connect that supply with the countries and customers who depend on it. That is precisely what we provide.

As the operator of the largest portfolio of floating regasification terminals in the world, Excelerate is well-positioned to take advantage of these macro tailwinds. What sets us apart is how we create value from that portfolio. We redeploy and optimize the assets we already own to drive incremental growth, and we invest selectively where we can add stable, contracted cash flow. This quarter is a good example of that discipline at work. Let's get into the updates on the progress we have made. The Excelerate Acadia, our newest floating regas terminal, is an example of how we create value from the infrastructure within our portfolio. The Acadia was delivered in April on budget and ahead of schedule. While it was originally planned for deployment to Iraq this summer, after the onset of the Middle East conflict, we moved quickly to find an interim deployment for the asset.

In May, we signed a nine-month charter with Jordan's National Electric Power Company, NEPCO, to deploy the Acadia to the country's existing LNG import terminal in Aqaba. Operations began in July, the deployment is expected to contribute approximately $20 million of EBITDA this year. We matched one of our floating regasification assets with an immediate customer need and generated meaningful earnings uplift while preserving the asset's strategic positioning for future opportunities. That is the advantage of operating a portfolio of this scale. When a market needs reliable regasification, we can respond. We are also creating incremental value over a much longer horizon. In June, we signed a long-term charter with a subsidiary of Frontera Energy Corporation to redeploy the FSR Express to a new LNG import terminal under development in Colombia's Caribbean coast. The agreement has an initial term of seven years and includes multiple extension options.

Following completion of its current charter and planned dry dock later this year, the Express is expected to begin service in Colombia in early 2027. The new agreement is expected to increase the Express's annual EBITDA contribution by about 35% compared to its current contract. Importantly, it also adds meaningful long-term contracted EBITDA to our backlog. Let me now turn to Iraq. In October 2025, we executed a definitive agreement with a subsidiary of Iraq's Ministry of Electricity to develop the country's first LNG import terminal. It is an integrated project that includes a five-year agreement for regasification services and LNG supply. It has extension options and a minimum contracted offtake of 250 million standard cubic feet per day. Despite the ongoing conflict in the Middle East, we have continued to advance the project while adapting our execution plans as conditions evolve.

We continue to monitor developments across the region closely, safety and security considerations remain at the forefront of project planning and execution. Engineering and procurement activities are nearing completion. Site clearance and dredging activities have continued in preparation for construction, materials required for the terminal have been staged globally and are now being mobilized based on construction priorities. Based on our current project schedule, we now expect terminal operations to commence early in the second quarter of 2027. We remain closely aligned with our counterparties on the value of this project to Iraq's energy system, we appreciate the support of the new Iraqi government and share its commitment to advancing infrastructure that strengthens the country's long-term energy security. When the terminal comes online, it will bring reliable, large-scale gas import capacity to a country that needs it.

It will do so under a take-or-pay contracted structure consistent with the rest of our portfolio. Next, let's turn to our FSRU conversion project. To position ourselves for new regasification opportunities as the LNG supply wave comes online, we're converting an LNG carrier into a floating regasification terminal to support our future earnings growth. In July, we entered into a definitive agreement to purchase our second LNG carrier, the Methane Patricia Camila, for approximately $79 million. It will serve as the dedicated vessel for our first FSRU conversion project. As you know, earlier in the process, we evaluated the Shenandoah as the potential conversion candidate, it remains a viable option for future conversion opportunities. However, ultimately, we selected the Methane Patricia Camila for this project because its 170,000 cubic meter storage capacity, TFDE power generation, and installed reliquefaction provide a strong technical foundation for a high-capability FSRU.

We believe these characteristics will enhance the performance of the asset, expand the range of opportunities it can serve, and increase the earnings potential over its operating life. We are also making good progress with the key milestones required to advance the project. Since executing the LNG carrier purchase agreement, we have ordered the regasification plant and continue to advance the shipyard scope toward definitive agreements. We continue to expect the converted FSRU to be available for commercial deployment in early 2028. By advancing the conversion today, we are positioning Excelerate to meet future customer demand at a time when available FSRU capacity is expected to remain limited. Let me close the business update with Jamaica, because it is an important example of where this company is headed over time. A little over a year ago, we acquired our integrated LNG and power platform in Jamaica.

What makes Jamaica valuable is not only the contribution it provides today, it is the combination of LNG import infrastructure, downstream customer relationships, and commercial opportunities that create multiple avenues for growth. Across Jamaica, we continue to identify opportunities to optimize the existing platform and increase utilization through additional LNG sales and expanded infrastructure services. Beyond Jamaica, we have already begun to leverage our existing infrastructure and LNG supply position to support customers on other islands and coastlines throughout the Caribbean. Today, our platform enables us to serve a broad range of customer needs through infrastructure solutions that range from truck-delivered LNG to larger integrated downstream projects. More importantly, Jamaica demonstrates how a single LNG infrastructure platform can create a scalable and repeatable model that can be expanded across the Caribbean over time.

We are seeing increased momentum on the commercial front. We look forward to providing updates on the progress we are making later this year. In summary, here are the key takeaways. Across our portfolio, we continue to create value from the assets we operate today while advancing future growth opportunities. Whether it's the Acadia in Jordan, the redeployment of the FSRU Express, the integrated Iraq LNG import terminal, or our FSRU conversion, each of these initiatives reflects the same approach to capital allocation. Together, they form a sequence pathway to growth through 2028. With each milestone building on the earnings power, contracted cash flow, and infrastructure platform we have in place today. We have a strong foundation and the financial strength to execute our strategy. Finally, I want to recognize our employees around the world. Their commitment and hard work are behind every milestone we discussed today.

With that, I'll turn the call over to Dana.

Thanks, Steven, and good morning, everyone. Excelerate delivered solid financial results in the second quarter. We reported net income of $50 million, roughly flat compared to the first quarter of 2026. Adjusted EBITDA for the second quarter was $120 million, down slightly versus the prior quarter. Adjusted EBITDA increased by 12% from the prior year second quarter, primarily due to a full quarter contribution from the Jamaica platform. For the second quarter, maintenance CapEx spend was $14 million, and committed growth capital spend was $241 million, inclusive of the final payment for the Acadia, which was paid in April. Behind these results is a strong balance sheet that supports near-term execution and our growth objectives. As of June 30th, 2026, total debt, including finance leases, was $1.2 billion.

We ended the quarter with $342 million of cash and cash equivalents, the full $500 million of capacity under our revolving credit facility was available. Net debt was $898 million, and trailing net leverage was 1.9 times. With leverage well below our target range and substantial available liquidity, we have plenty of financial capacity to fund our growth pipeline while continuing to return capital to shareholders. Our capital allocation framework remains disciplined. First, we invest in accretive growth opportunities across our infrastructure platform. Second, we return capital to shareholders through a growing dividend. Finally, when market conditions warrant, we pursue opportunistic share repurchases. Consistent with that framework, our board recently approved a quarterly cash dividend of $0.09 per share of Class A common stock, representing roughly a 13% increase over the prior quarter.