Excelerate Energy raises 2025 adjusted EBITDA guidance to $450M while accelerating Iraq LNG terminal project

Earnings Call Insights: Excelerate Energy (EE) Q3 2025

MANAGEMENT VIEW

* CEO Steven Kobos opened the call by addressing the impact of Hurricane Melissa on Jamaica, highlighting the rapid restoration of operations and emphasizing the company's commitment to the region. Kobos stated, "I want to reassure our stakeholders that we have comprehensive insurance coverage for adverse weather events like this. With that insurance coverage, combined with our take-or-pay business model, we are confident that there will be limited financial impacts resulting from Hurricane Melissa."
* Kobos highlighted record quarterly EBITDA of $129 million and noted, "With approximately 90% of our future contracted cash flows under take-or-pay agreements, portfolio of weighted average investment-grade counterparties and minimal commodity exposure, we continue to deliver predictable cash flows through market cycles."
* Key strategic development included the execution of a definitive agreement with Iraq's Ministry of Electricity to develop the country's first LNG import terminal at the Port of Khor Al Zubair. Kobos explained, "Unlike a traditional FSRU charter where Excelerate provides regasification capacity alone, an integrated deal allows us to capture a broader portion of the value chain. This approach also creates multiple revenue streams and a more durable commercial framework."
* The company is advancing the conversion of the Excelerate Shenandoah LNG carrier into a floating storage and regasification unit to expand fleet flexibility. Engineering work and procurement of long-lead items have started to compress the construction timeline.
* CFO Dana Armstrong stated, "We reported adjusted net income of $57 million, which is a sequential increase of $10 million or up 22% as compared to the second quarter of this year. Adjusted EBITDA for the third quarter was $129 million, up $22 million or up 21% versus the prior quarter."
* Armstrong added, "For the 3 months ended September 30, our total debt, including finance leases, was $1.3 billion, and we had $463 million of cash and cash equivalents on hand. Additionally, all of the $500 million of capacity under our revolver was available for borrowings."
* Armstrong confirmed the board approved a quarterly cash dividend of $0.08 per share, payable on December 4th.

OUTLOOK

* The company raised its full-year 2025 adjusted EBITDA guidance to a range between $435 million and $450 million. Armstrong said, "For the full year, we now expect adjusted EBITDA to range between $435 million and $450 million. This revised guidance range incorporates the minimal financial impact we expect from Hurricane Melissa."
* Maintenance CapEx is expected to range between $65 million and $75 million, with committed growth CapEx between $95 million and $105 million for the year.
* Looking forward, Armstrong noted the Petrobangla QatarEnergy LNG supply deal starts in January 2026 and is expected to contribute $15 million of incremental EBITDA in 2026 and 2027, stepping up to $18 million in 2028 and thereafter.

FINANCIAL RESULTS

* Adjusted net income for Q3 was $57 million, and adjusted EBITDA reached $129 million, both increases over the prior quarter.
* Q3 results benefited from a full quarter of Jamaica margin, savings in Exemplar dry dock costs, and lower-than-expected fuel costs for the Shenandoah.
* Net debt at quarter-end was $818 million, and the 12-month trailing net leverage was about 2x.
* The dividend remains at $0.08 per share, and the company maintains a strong liquidity position.

Q&A

* Wade Suki, Capital One, asked about the margin split for the Iraq project and CapEx for the Shenandoah conversion. Kobos indicated no breakdown would be provided, but emphasized variability in the contract and confirmed a $200 million all-in estimate for the conversion.
* Suki also inquired about the timeline and capital cost for the conversion, with Kobos confirming prior guidance and noting flexibility in execution.
* Chris Robertson, Deutsche Bank, asked about remaining spend for Hull 3407 and jetty construction in Iraq. Armstrong stated, "We've got $200 million left to pay, and that will be paid at delivery. So the total cost of the shipyard was about $340 million with some of our change orders."
* Robertson also asked about commercial discussions in the Caribbean. Simpson stated there is strong interest in both small-scale onshore regas and floating solutions, with Jamaica serving as a hub.
* Robert Brooks, Northland Capital Markets, asked about insurance coverage, to which Kobos replied, "Most of the insurance programs on the floating assets, it's all quite similar on land-based assets."
* Michael Scialla, Stephens Inc., asked if the Jamaica model would be deployed globally. Kobos responded, "We want to be an integrated energy company in these markets."
* Emma Schwartz, Jefferies, inquired about the repeatability of integrated deals. Kobos affirmed, "We absolutely do."

SENTIMENT ANALYSIS

* Analysts expressed positive sentiment, with multiple acknowledgments of the company's quick recovery efforts in Jamaica and the strategic value of the Iraq deal. Questions focused on project execution, margin splits, and capital allocation.
* Management maintained a confident and upbeat tone during both prepared remarks and Q&A, emphasizing operational resilience, growth opportunities, and financial discipline. Kobos highlighted integration and strategic execution, while Armstrong provided detailed financial clarity.
* Compared to the previous quarter, analyst tone was more focused on specific project execution and less on broader strategic growth, reflecting heightened interest in near-term deliverables. Management maintained consistent confidence throughout both calls.

QUARTER-OVER-QUARTER COMPARISON

* The current quarter featured significant updates, including the Iraq terminal contract, integration progress in Jamaica, and increased full-year EBITDA guidance.
* Management tone remained confident, but this quarter's call included more detailed discussion of project execution and resilience post-Hurricane Melissa.
* Analysts shifted focus from broader Caribbean growth to specifics on capital allocation, insurance coverage, and integrated project economics.
* Key metrics such as adjusted EBITDA and net income increased sequentially, with guidance also raised compared to Q2.
* The strategic focus evolved from integrating Jamaica assets to expanding integrated solutions globally and accelerating project delivery in Iraq.

RISKS AND CONCERNS

* Management addressed operational risks from Hurricane Melissa, assuring stakeholders of "comprehensive insurance coverage for adverse weather events."
* There was discussion of political and execution risks in the Iraq project, with Kobos emphasizing risk mitigation via take-or-pay contracts, credit support, and political risk insurance.
* Analysts raised questions about insurance coverage across other assets and potential contract expirations, which management addressed by highlighting their proactive risk management and contract optimization strategy.

FINAL TAKEAWAY

Excelerate Energy is executing on a disciplined strategy, delivering record financial results, and raising full-year guidance while expanding its infrastructure platform in key markets like Iraq and Jamaica. The company’s resilience in the face of natural disasters, combined with a portfolio of take-or-pay contracts and robust risk mitigation, underpins its confidence in sustaining predictable cash flows and long-term growth. Management emphasizes scalable, integrated solutions as a foundation for capturing new opportunities amid accelerating global LNG demand.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/ee/earnings/transcripts]

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