Targa Resources Corp. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net income attributable to Targa Resources Corp. was $658 million for the third quarter of 2026, a 38% increase from $478 million in the same period in 2025.
• Adjusted EBITDA was $1,504 million for the third quarter of 2026, an 18% year-over-year increase from $1,275 million in Q3 2025.
• Total revenues were $5,598.6 million for the quarter, up 35% from $4,151.2 million in Q3 2025, driven by a 36% increase in commodity sales and a 29% increase in fees from midstream services.
• Adjusted cash flow from operations was $1,276.8 million for the quarter, an 18% increase from $1,082.8 million in Q3 2025.
• Adjusted free cash flow was $33.6 million for the quarter, a decrease of 81% from $172.8 million in Q3 2025.
• Total consolidated debt was $19.8 billion as of September 30, 2026.
• Total consolidated liquidity was approximately $2.9 billion as of September 30, 2026, including $2.6 billion available under the TRGP Revolver.

Guidance and Future Outlook:

• Full-year 2026 adjusted EBITDA is now expected to be at least $6.0 billion.
• Net growth capital expenditures for 2026 are estimated at approximately $5.0 billion, with net maintenance capital expenditures estimated at approximately $250 million.
• Management intends to recommend a common dividend of $6.00 per share annually ($1.50 per share quarterly) for 2027, representing a 20% increase from 2026 levels.
• The Yeti and Yeti II plants are now expected to begin operations in the second and third quarters of 2027, respectively, earlier than previously expected.
• New processing plants in the Permian Midland and two in the Permian Delaware are expected to be needed in 2028 or early 2029.
• Train 14, a new 150,000 barrels per day NGL fractionator in Mont Belvieu, is expected to begin operations in the first quarter of 2029.

Business Segments and Product Lines:

• Gathering and Processing (G&P): Adjusted operating margin was $1,069.9 million for the quarter, up 22% year-over-year. Record Permian inlet volumes were driven by plant additions (Bull Moose II, Falcon II, East Pembrook, East Driver) and asset acquisitions. Total Permian natural gas inlet volumes reached 7,536.6 MMcf/d, up 14% year-over-year.
• Logistics and Transportation (L&T): Adjusted operating margin was $888.1 million for the quarter, up 10% year-over-year. Record NGL transportation and fractionation volumes were offset by lower marketing and LPG export margins. NGL pipeline transportation volumes were 1,171.7 MBbl/d, up 15% year-over-year.
• New Projects: Operations commenced on Train 12 fractionator and the Bull Run Extension intra-basin residue pipeline ahead of schedule. The Copperhead plant in the Permian Delaware is in start-up ahead of schedule.
• Commercial Agreements: In August 2026, announced new 20-year, fee-based integrated midstream agreements with ExxonMobil subsidiaries for natural gas gathering, processing, and downstream services in the Permian Basin, supported by three new processing plants (Wrangler, Ranger, Ranger II).

Market and Competitive Landscape:

• The Company operates as a leading provider of midstream services and is one of the largest independent infrastructure companies in North America.
• Permian Basin production growth continues to drive higher inlet volumes and supply volumes for the L&T segment.
• The Company is ordering long-lead items for additional processing plants in response to increasing production and customer infrastructure needs.

Risks and Challenges:

• Forward-looking statements note risks including commodity price volatility, weather, political and economic conditions, and the timing and success of capital project completion.
• Risks include the realization of expected benefits from long-term commercial agreements, the growth of volumes on systems, and changes in laws and regulations regarding taxes and trade.
• The Company notes that adjusted free cash flow decreased significantly in the quarter due to higher growth capital expenditures.

Management Commentary and Tone:

• Management highlighted record Permian inlet, NGL transportation, and fractionation volumes as key drivers of performance.
• The tone reflects confidence in operating performance, citing the strength of the first three quarters of 2026 as the basis for raising full-year EBITDA guidance.
• Management emphasized the strategic value of the new long-term agreements with ExxonMobil and the execution of growth projects ahead of schedule.

Other Key Points:

• In August 2026, the Company announced the ordering of long-lead items for an additional processing plant in the Permian Midland and two additional plants in the Permian Delaware.
• The Company declared a quarterly cash dividend of $1.25 per share for Q3 2026, a 25% increase over the Q3 2025 dividend.
• During the quarter, Targa repurchased 180,768 shares of common stock for a total net cost of $52 million.
• As of September 30, 2026, $1,187 million remained available under the Company's share repurchase programs.
• Total cash dividends of approximately $268 million were paid on November 17, 2026.
• The Company recognized Section 45Q tax credits earned through carbon capture and sequestration activities, contributing to the increase in other operating (income) expense for the nine-month period.