# DT Midstream, Inc.: Form 10-Q for the period ended Mar 31, 2024

- Company: [DT Midstream, Inc.](/companies/dtm.md) (CIK 1842022)
- Form: 10-Q
- Filed: 2024-04-30
- Accepted by EDGAR: Apr 30, 2024, 11:16 ET
- Period: 2024-03-31
- Accession: 0001842022-24-000007
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1842022/000184202224000007/dtm-20240331.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1842022/000184202224000007/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2024-03-31.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2024-01-01 to 2024-03-31 | $240.0m | us-gaap:Revenues |
| Operating income | 3 months, 2024-01-01 to 2024-03-31 | $124.0m | us-gaap:OperatingIncomeLoss |
| Interest expense | 3 months, 2024-01-01 to 2024-03-31 | $40.0m | us-gaap:InterestExpense |
| Income tax | 3 months, 2024-01-01 to 2024-03-31 | $31.0m | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2024-01-01 to 2024-03-31 | $97.0m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2024-01-01 to 2024-03-31 | $0.99 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2024-01-01 to 2024-03-31 | $1.00 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2024-01-01 to 2024-03-31 | 97,700,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 3 months, 2024-01-01 to 2024-03-31 | $241.0m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 3 months, 2024-01-01 to 2024-03-31 | $98.0m | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Dividends paid | 3 months, 2024-01-01 to 2024-03-31 | $67.0m | us-gaap:PaymentsOfDividendsCommonStock |
| Cash and equivalents | at 2024-03-31 | $41.0m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2024-03-31 | $229.0m | us-gaap:AssetsCurrent |
| Total assets | at 2024-03-31 | $8.95bn | us-gaap:Assets |
| Current liabilities | at 2024-03-31 | $322.0m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2024-03-31 | $4.64bn | us-gaap:Liabilities |
| Long-term debt | at 2024-03-31 | $3.07bn | us-gaap:LongTermDebtNoncurrent |
| Short-term borrowings | at 2024-03-31 | $55.0m | us-gaap:ShortTermBorrowings |
| Shareholders' equity | at 2024-03-31 | $4.17bn | us-gaap:StockholdersEquity |
| Shares outstanding | at 2024-03-31 | 97,109,100 shares | dei:EntityCommonStockSharesOutstanding |

## Management's discussion and analysis

As filed, 24,162 characters.

*The following discussion of our results of operations and financial condition should be read in conjunction with our unaudited Consolidated Financial Statements and the Notes to Consolidated Financial Statements, which are included under Part I, Item 1. of this quarterly report, and the historical consolidated financial statements and notes thereto, which are included in the DT Midstream 2023 Annual Report on Form 10-K. This discussion contains forward-looking statements that involve risks and uncertainties. The forward-looking statements are not historical facts, but rather are based on current expectations, estimates, assumptions and projections about the midstream industry and our business and financial results. Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number of factors, including those discussed in the sections entitled "Forward-Looking Statements" and "Risk Factors."*

### OVERVIEW

### Our Business

We are an owner, operator, and developer of an integrated portfolio of natural gas midstream assets. We provide multiple, integrated natural gas services to customers through our Pipeline segment, which includes interstate pipelines, intrastate pipelines, storage systems, and gathering lateral pipelines, and through our Gathering segment. We also own joint venture interests in equity method investees which own and operate interstate pipelines that connect to our wholly owned assets.

Our core assets strategically connect key demand centers in the Midwestern U.S., Eastern Canada and Northeastern U.S. regions to the premium production areas of the Marcellus/Utica natural gas formation in the Appalachian Basin and connect key demand centers and LNG export terminals in the Gulf Coast region to premium production areas of the Haynesville natural gas formation.

We have an established history of stable, long-term growth with contractual cash flows from customers that include natural gas producers, local distribution companies, electric power generators, industrials, and national marketers.

### STRATEGY

Our principal business objective is to safely and reliably operate and develop natural gas assets across our premier footprint. Our proven leadership and highly engaged employees have an excellent track record. Prospectively, we intend to continue this track record by executing on our natural gas-centric business strategy focused on disciplined capital deployment and supported by a flexible, well capitalized balance sheet. Additionally, we intend to develop low carbon business opportunities and deploy GHG reducing technologies as part of our goal of being leading environmental stewards in the midstream industry. We are executing on our goal to achieve net zero carbon emissions by 2050.

Our strategy is premised on the following principles:

- operate our assets in a sustainable and responsible manner;
- provide exceptional service to our customers;
- disciplined capital deployment in assets supported by strong fundamentals;
- capitalize on asset integration and utilization opportunities;
- pursue economically attractive opportunities; and
- grow cash flows supported by long-term firm revenue contracts.

### RESULTS OF OPERATIONS

Management’s Discussion and Analysis of Financial Condition and Results of Operations includes financial information prepared in accordance with GAAP. The following sections discuss the operating performance and future outlook of our segments. Segment information includes intercompany revenues and expenses, as well as other income and deductions that are eliminated in the Consolidated Financial Statements.

For purposes of the following discussion, any increases or decreases refer to the comparison of the three months ended March 31, 2024 to the three months ended December 31, 2023, and the three months ended March 31, 2024 to the three months ended March 31, 2023, as applicable. The following table summarizes our consolidated financial results:

*(millions, except per share amounts)*

|  | Three Months Ended March 31, 2024 | December 31, 2023 | March 31, 2023 |
| --- | ---: | ---: | ---: |
| Operating revenues | **$240** | $244 | $220 |
| Net Income Attributable to DT Midstream | **97** | 121 | 81 |
| Diluted Earnings per Common Share | **$0.99** | $1.24 | $0.84 |

| Net Income Attributable to DT Midstream | Three Months Ended March 31, 2024 (millions) | December 31, 2023 | March 31, 2023 |
| --- | ---: | ---: | ---: |
| Pipeline | **$74** | $93 | $57 |
| Gathering | **23** | 28 | 24 |
| Total | **$97** | $121 | $81 |

23

### Pipeline

The Pipeline segment consists of our interstate pipelines, intrastate pipelines, storage systems, gathering lateral pipelines including related treatment plants and compression and surface facilities. This segment also includes our equity method investments.

Pipeline results and outlook are discussed below:

|  | Three Months Ended March 31, 2024 (millions) | December 31, 2023 | March 31, 2023 |
| --- | ---: | ---: | ---: |
| Operating revenues | **$107** | $106 | $85 |
| Operation and maintenance | **16** | 17 | 11 |
| Depreciation and amortization | **18** | 19 | 16 |
| Taxes other than income | **6** | 3 | 4 |
| **Operating Income** | **67** | 67 | 54 |
| Interest expense | **13** | 13 | 16 |
| Interest income | **(1)** | — | — |
| Earnings from equity method investees | **(46)** | (45) | (50) |
| Income tax expense | **24** | 3 | 28 |
| **Net Income** | **77** | 96 | 60 |
| **Less: Net Income Attributable to Noncontrolling Interests** | **3** | 3 | 3 |
| **Net Income Attributable to DT Midstream** | **$74** | $93 | $57 |

*Operating revenues* increased $22 million compared to the three months ended March 31, 2023 primarily due to new contracts for Haynesville System (LEAP) expansions of $13 million, higher Stonewall volumes of $4 million, higher long-term storage contracting rates at Washington 10 Storage Complex of $2 million and a full quarter of new transmission service contracts at the Michigan System of $2 million.

*Operation and maintenance* expense increased $5 million compared to the three months ended March 31, 2023 primarily due to operational flow order fee activity in the prior period and higher operation and maintenance expenses at LEAP in the current period.

*Taxes other than income* increased $3 million compared to the three months ended December 31, 2023 primarily due to new Haynesville System (LEAP) assets placed into service and higher state franchise taxes.

*Interest expense* decreased $3 million compared to the three months ended March 31, 2023 primarily due to lower outstanding borrowings under the Revolving Credit Facility, partially offset by lower capitalized interest due to lower construction in progress during 2024.

*Earnings from equity method investees* decreased $4 million compared to the three months ended March 31, 2023 primarily due to higher interest expense driven by timing of new senior unsecured notes at NEXUS of $5 million, partially

offset by higher revenues of $2 million at NEXUS.

*Income tax expense* increased $21 million compared to the three months ended December 31, 2023 primarily due to the remeasurement of state deferred taxes recognized in 2023. *Income tax expense* decreased $4 million compared to the three months ended March 31, 2023 primarily due to the remeasurement of state deferred taxes recognized in 2023, partially offset by an increase in Income before income taxes. See Note 7, "Income Taxes" to the Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

#### Pipeline Outlook

We believe our long-term agreements with customers and the location and connectivity of our pipeline assets position the business for future growth. We will continue to pursue economically attractive expansion opportunities that leverage our current asset footprint and strategic relationships. These growth opportunities include further expansion at the Haynesville System (LEAP) and Stonewall, new contracts at the Washington 10 Storage Complex, and additional growth related to our equity method investments.

### Gathering

The Gathering segment includes gathering systems, related treatment plants and compression and surface facilities. Gathering results and outlook are discussed below:

|  | Three Months Ended March 31, 2024 (millions) | December 31, 2023 | March 31, 2023 |
| --- | ---: | ---: | ---: |
| Operating revenues | **$133** | $138 | $135 |
| Operation and maintenance | **38** | 52 | 47 |
| Depreciation and amortization | **32** | 30 | 27 |
| Taxes other than income | **6** | 3 | 5 |
| **Operating Income** | **57** | 53 | 56 |
| Interest expense | **27** | 26 | 22 |
| Other (income) and expense | **—** | — | (1) |
| Income tax expense (benefit) | **7** | (1) | 11 |
| **Net Income Attributable to DT Midstream** | **$23** | $28 | $24 |

*Operating revenues* decreased $5 million compared to the three months ended December 31, 2023 primarily due to lower

Susquehanna Gathering volumes of $2 million, lower MVC deficiency fee revenues on Appalachia Gathering of $3 million and lower Haynesville System (Blue Union Gathering) volumes of $1 million, partially offset by a full quarter of a new customer contract on Ohio Utica Gathering of $2 million. *Operating revenues* decreased $2 million compared to the three months ended March 31, 2023 primarily due to lower volumes and lower recovery of production related operating expenses on Blue Union Gathering of $8 million, partially offset by higher Appalachia Gathering volumes of $5 million net of lower MVC deficiency fee revenues, and a new customer contract on Ohio Utica Gathering of $2 million.

*Operation and maintenance* expense decreased $14 million compared to the three months ended December 31, 2023 primarily due to lower planned maintenance on Blue Union Gathering of $11 million, lower Appalachia Gathering expenses of $1 million, higher capitalized labor and lower labor related expenses of $1 million. *Operation and maintenance* expense decreased $9 million compared to the three months ended March 31, 2023 primarily due to lower planned maintenance and production related operating expenses on Blue Union Gathering of $8 million.

*Depreciation and amortization* expense increased $5 million compared to the three months ended March 31, 2023 primarily due to assets placed into service at Blue Union Gathering, Ohio Utica Gathering and Appalachia Gathering.

*Taxes other than income* increased $3 million compared to the three months ended December 31, 2023 primarily due to Blue Union Gathering assets placed into service and a property tax adjustment on Blue Union Gathering in the prior period.

*Interest expense* increased $5 million compared to the three months ended March 31, 2023 primarily due to lower capitalized interest due to lower construction in progress during 2024 and higher interest rates on the Term Loan Facility, partially offset by lower outstanding borrowings under the Revolving Credit Facility.

*Income tax expense* increased $8 million compared to the three months ended December 31, 2023 primarily due to the remeasurement of state deferred taxes recognized in 2023. *Income tax expense* decreased $4 million compared to the three months ended March 31, 2023 primarily due to the remeasurement of state deferred taxes recognized in 2023 and an increase in Income before income taxes. See Note 7, "Income Taxes" to the Consolidated Financial Statements under Part I, Item 1 of this Form 10-Q.

#### Gathering Outlook

We believe our long-term agreements with producers and the quality of the natural gas reserves in the Marcellus/Utica and Haynesville formations position the business for future growth. We will continue to pursue economically attractive expansion opportunities that leverage our current asset footprint and strategic relationships. These growth opportunities include further expansion at the Haynesville System (Blue Union Gathering), Appalachia Gathering, Tioga Gathering, and Ohio Utica Gathering.

### ENVIRONMENTAL MATTERS

We are subject to extensive U.S. federal, state, and local environmental regulations. Additional compliance costs may result as the effects of various substances on the environment are studied and governmental regulations are developed and implemented. Actual costs to comply with such regulation could vary substantially from our expectations. Pending or future legislation or regulation could have a material impact on our operations and financial position. Potential impacts include unplanned expenditures for environmental equipment, such as pollution control equipment, financing costs related to additional capital expenditures, and the replacement costs of aging pipelines and other facilities.

For further discussion of environmental matters, see Note 10, "Commitments and Contingencies" to the Consolidated Financial Statements under Part I, Item 1. of this Form 10-Q.

### CAPITAL RESOURCES AND LIQUIDITY

### Cash Requirements

Our principal liquidity requirements are to finance our operations, fund capital expenditures, satisfy our indebtedness obligations, and pay approved dividends. We believe we will have sufficient internal and external capital resources to fund anticipated capital and operating requirements.

|  | Three Months Ended March 31, 2024 (millions) | 2023 |
| --- | ---: | ---: |
| **Cash and Cash Equivalents at Beginning of Period** | **$56** | $61 |
| Net cash and cash equivalents from operating activities | **241** | 244 |
| Net cash and cash equivalents from (used for) investing activities | **(71)** | (216) |
| Net cash and cash equivalents from (used for) financing activities | **(185)** | 6 |
| **Net Increase (Decrease) in Cash and Cash Equivalents** | **(15)** | 34 |
| **Cash and Cash Equivalents at End of Period** | **$41** | $95 |

For purposes of the following discussion, any increases or decreases refer to the comparison of the three months ended March 31, 2024 to the three months ended March 31, 2023.

### Operating Activities

Cash flows from our operating activities can be impacted in the short term by the natural gas volumes gathered or transported through our systems under interruptible service revenue contracts, changing natural gas prices, seasonality, weather fluctuations, dividends received from equity method investees and the financial condition of our customers. Our preference to enter into firm service revenue contracts leads to more stable operating performance, revenues and cash flows and limits our exposure to natural gas price fluctuations.

*Net cash and cash equivalents from operating activities* decreased $3 million for the three months ended March 31, 2024 primarily due to a decrease in dividends received from equity method investees, partially offset by an increase in operating income after adjustment for non-cash items including depreciation and amortization expense, stock-based compensation, and amortization of operating lease right-of-use assets.

### Investing Activities

Cash outflows associated with our investing activities are primarily the result of plant and equipment expenditures, acquisitions, and contributions to equity method investees. Cash inflows from our investing activities are generated from proceeds from sale or collection of notes receivable, distributions received from equity method investees, and proceeds from asset sales.

*Net cash and cash equivalents used for investing activities* decreased $145 million for the three months ended March 31, 2024 primarily due to a decrease in cash used for plant and equipment expenditures and higher distributions received from equity method investees in 2024.

### Financing Activities

DT Midstream paid cash dividends on common stock of $67 million and $62 million during the three months ended March 31, 2024 and 2023, respectively. See Note 6, "Earnings Per Share and Dividends" to the Consolidated Financial Statements under Part I, Item 1. of this Form 10-Q.

*Net cash and cash equivalents used for financing activities* of $185 million for the three months ended March 31, 2024 increased as compared to net cash and cash equivalents from financing activities of $6 million for the three months ended March 31, 2023 primarily due to higher net repayments of borrowings under the Revolving Credit Facility and higher dividends paid on common stock, partially offset by lower distributions to noncontrolling interests.

### Outlook

We expect to continue executing on our natural gas-centric business strategy focused on disciplined capital deployment and supported by a flexible, well capitalized balance sheet. Other than the impact of the items discussed below on our debt and equity capitalization, we are not aware of any trends, other demands, commitments, events or uncertainties that are reasonably likely to materially impact our liquidity position.

Our working capital requirements will be primarily driven by changes in accounts receivable and accounts payable. We continue our efforts to identify opportunities to improve cash flows through working capital initiatives and obtaining long-term firm service revenue contracts from customers.

Our sources of liquidity include cash and cash equivalents generated from operating activities and available borrowings under our Revolving Credit Facility. As of March 31, 2024, we had $16 million of letters of credit outstanding and $55 million of borrowings outstanding under our Revolving Credit Facility. We had approximately $970 million of available liquidity as of March 31, 2024, consisting of cash and cash equivalents and available borrowings under our Revolving Credit Facility.

We expect to pay regular cash dividends to DT Midstream common stockholders in the future. Any payment of future dividends is subject to approval by the Board of Directors and may depend on our future earnings, cash flows, capital requirements, financial condition, and the effect a dividend payment would have on our compliance with relevant financial covenants. Over the long-term, we expect to grow our dividend 5% to 7% annually.

We believe we will have sufficient operating flexibility, cash resources and funding sources to maintain adequate liquidity amounts and to meet future operating cash, capital expenditure and debt servicing requirements. However, our business is capital intensive, and the inability to access adequate capital could adversely impact future earnings and cash flows.

The Credit Agreement covering the Term Loan Facility and Revolving Credit Facility includes financial covenants that DT Midstream must maintain. See Note 9, "Debt" and Note 10, "Commitments and Contingencies" to the Consolidated Financial Statements under Part I, Item 1. of this Form 10-Q.

### CAPITAL INVESTMENTS

Capital spending within our Company is primarily for ongoing maintenance and expansion of our existing assets, and if identified, attractive growth opportunities. We have been disciplined in our capital deployment and make growth investments that meet our criteria in terms of strategy, management skills, and identified risks and expected returns. All potential investments are analyzed for their rates of return and cash payback on a risk-adjusted basis. Our total capital expenditures, inclusive of $1 million in contributions to equity method investees, were $99 million for the three months ended March 31, 2024 primarily for expansions on Ohio Utica Gathering, Blue Union Gathering and LEAP. We anticipate total capital expenditures, inclusive of contributions to equity method investees, for the year ended December 31, 2024 of approximately $350 million to $435 million.

### CRITICAL ACCOUNTING ESTIMATES

The preparation of our Consolidated Financial Statements in conformity with GAAP requires that management applies accounting policies and makes estimates and assumptions that affect results of operations and the amounts of assets and liabilities reported in the Consolidated Financial Statements. Management believes that the area described below requires significant judgment in the application of the accounting policy or in making estimates and assumptions in matters that are inherently uncertain and that may change in subsequent periods.

### Goodwill

We have goodwill that resulted from business combinations. Annually as of October 1st, an impairment test for goodwill is performed which compares the fair value of each reporting unit to its carrying value including goodwill. In between annual impairment tests, we monitor our estimates and assumptions regarding estimated future cash flows, including the impact of movements in market indicators. An interim impairment test is performed whenever a triggering event occurs or circumstances indicate that the value of goodwill may be impaired.

The estimated fair value in our annual goodwill impairment analysis utilizes significant assumptions that require judgement by management. One such significant assumption is the weighted average cost of capital (WACC) which is used to discount estimates of projected future results and cash flows to be generated by each reporting unit. The WACC is based on our cost of debt, which includes U.S. industrial bond spreads, and cost of equity, which consists of U.S. Treasury Rates plus an equity risk premium. We have noted that U.S. Treasury risk-free rates have decreased slightly since our last annual goodwill impairment test.

Our annual goodwill impairment analysis includes a comparison of the estimated fair value of the Company as a whole to our market capitalization. Management also compares the implied market multiple of the estimated fair value of each reporting unit to midstream industry transaction multiples and considers other market indicators to support the appropriateness of the fair value estimates. Our consolidated market capitalization has increased since our last annual goodwill impairment test. We have noted a slight decline in gathering-related midstream industry transaction multiples since our last annual goodwill impairment test. After assessing all relevant facts and circumstances, we have concluded that no triggering event has occurred that indicates it is more likely than not that the goodwill is impaired for either reporting unit and determined that an interim impairment test is not required. We will continue to monitor our estimates and assumptions on a quarterly basis as market conditions continue to evolve.

While we believe the estimates and assumptions in the fair value are reasonable, the actual results may differ from projections. To the extent projected results or cash flows are revised downward, the reporting unit may be required to write down all or a portion of its goodwill, which would adversely impact our earnings. If current expectations of future long-term growth are not met or market factors outside of our control change, such as U.S. Treasury Rates, a decline in our market capitalization, or a further decline in midstream industry transaction multiples, this may lead to a goodwill impairment in the future.

See Part I, Item 3., "Quantitative and Qualitative Disclosures About Market Risk", in this Form 10-Q for more information on our exposure to market risk. See also "Critical Accounting Estimates" included in DT Midstream's 2023 Annual Report on Form 10-K.

### OFF-BALANCE SHEET ARRANGEMENTS

We are party to off-balance sheet arrangements, which include our equity method investments. See Note 1, "Description of the Business and Basis of Presentation—Principles of Consolidation" to the Consolidated Financial Statements under Part I, Item 1. of this Form 10-Q for further discussion of the nature, purpose and other details of such agreements.

Other off-balance sheet arrangements include the Vector line of credit and our surety bonds, which are discussed further in Note 10, "Commitments and Contingencies" to the Consolidated Financial Statements under Part I, Item 1. of this Form 10-Q.

### NEW ACCOUNTING PRONOUNCEMENTS

See Note 3, "New Accounting Pronouncements" to the Consolidated Financial Statements under Part I, Item 1. of this Form 10-Q.

## Market risk

As filed, 3,793 characters.

### Market Price Risk

Our business is dependent on the continued availability of natural gas production and reserves in our geographical areas of operation. Low prices for natural gas, including those resulting from regional basis differentials, could adversely affect development of additional reserves and future natural gas production that is accessible by our pipeline and storage assets. We manage our exposure through the use of short, medium, and long-term transportation, gathering, and storage contracts. Consequently, our existing operations and cash flows have limited direct exposure to natural gas price risk.

### Credit Risk

We are exposed to credit risk, which is the risk of loss resulting from nonpayment or nonperformance under a contract. We manage our exposure to credit risk associated with customers through credit analysis, credit approval, credit limits and monitoring procedures. For certain transactions, we may request letters of credit, cash collateral, prepayments or guarantees as forms of credit support. Our FERC tariffs require tariff customers that do not meet specified credit standards to provide three months of credit support, however, we are exposed to credit risk beyond this three-month period when our tariffs do not require our customers to provide additional credit support. For some long-term contracts associated with gathering system construction or expansion, we have entered into negotiated credit agreements that provide for enhanced forms of credit support if certain customer credit standards are not met.

We depend on a key customer, Southwestern Energy, in the Haynesville formation in the Gulf Coast and in the Utica and Marcellus formations in the Northeastern U.S. for a significant portion of our revenues. The loss of, or reduction in volumes from, this key customer could result in a decline in demand for our services and materially adversely affect our business, financial condition and results of operations.

We engage with customers that are sub-investment grade, including our key customer, Southwestern Energy. These customers are otherwise considered creditworthy or are required to make prepayments or provide security to satisfy credit concerns. We regularly monitor for bankruptcy proceedings that may impact our customers and had no bankruptcy proceedings during the three months ended March 31, 2024.

### Interest Rate Risk

We are subject to interest rate risk in connection with the issuance of debt. Our exposure to interest rate risk arises primarily from changes in SOFR. As of March 31, 2024, we had floating rate debt of $454 million related to the variable rate Term Loan Facility and borrowings outstanding under our Revolving Credit Facility, and a floating rate debt-to-total debt ratio of 14%. See Note 9, "Debt" to the Consolidated Financial Statements under Part I, Item 1. of this Form 10-Q.

We are subject to interest rate risk in connection with our goodwill impairment assessment. See "Critical Accounting Estimates" under Part I, Item 2 of this Form 10-Q.

### Summary of Sensitivity Analysis

A sensitivity analysis was performed on the fair values of our long-term debt obligations. The sensitivity analysis involved increasing and decreasing interest rates as of March 31, 2024 by a hypothetical 10% and calculating the resulting change in the fair values. The hypothetical losses related to long-term debt would be realized only if we transferred all of our fixed-rate long-term debt to other creditors. The results of the sensitivity analysis are as follows:

| Activity | Assuming a 10% Increase in Rates As of March 31, 2024 (millions) | Assuming a 10% Decrease in Rates | Change in the Fair Value of |
| --- | ---: | ---: | --- |
| Interest rate risk | **$(80)** | **$83** | Long-term debt |

29

## Controls and procedures

As filed, 1,588 characters.

### (a) Evaluation of disclosure controls and procedures

Management of DT Midstream carried out an evaluation, under the supervision and with the participation of DT Midstream's Chief Executive Officer (CEO) and Chief Financial Officer (CFO), of the effectiveness of the design and operation of DT Midstream's disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of March 31, 2024, which is the end of the period covered by this report. Based on this evaluation, DT Midstream's CEO and CFO have concluded that such disclosure controls and procedures are effective in providing reasonable assurance that information required to be disclosed by DT Midstream in reports that it files or submits under the Exchange Act (i) is recorded, processed, summarized, and reported within the time periods specified in the SEC's rules and forms and (ii) is accumulated and communicated to DT Midstream's management, including our CEO and CFO, as appropriate to allow timely decisions regarding required disclosure. Due to the inherent limitations in the effectiveness of any disclosure controls and procedures, management cannot provide absolute assurance that the objectives of our disclosure controls and procedures will be attained.

### (b) Changes in internal control over financial reporting

There have been no changes in DT Midstream's internal control over financial reporting during the quarter ended March 31, 2024 that have materially affected, or are reasonably likely to materially affect, DT Midstream's internal control over financial reporting.

## Risk factors

As filed, 458 characters.

There are various risks associated with the operations of DT Midstream's businesses. To provide a framework to understand the operating environment of DT Midstream, a brief explanation of the more significant risks associated with DT Midstream's businesses is provided in Part I, Item 1A. "Risk Factors" in DT Midstream's 2023 Annual Report on Form 10-K. Although DT Midstream has identified and disclosed key risk factors, others could emerge in the future.

Filed Apr 30, 2024.
Source: SEC EDGAR, the filing index for accession 0001842022-24-000007. Last ingested by Listed: Oct 29, 2026, 19:07 ET. No prices; not investment advice.