Fitch Ratings upgraded DT Midstream, Inc.'s Long-Term Issuer Default Rating (IDR) to 'BBB-' from 'BB+' on October 4, 2024, assigning a Stable Outlook. This upgrade also included the senior unsecured notes, which were raised to 'BBB-'.
The upgrade follows a significant improvement in the credit profile of DT Midstream's major counterparty, Expand Energy Corporation (EXE), which was also upgraded to 'BBB-'. This development means DT Midstream now derives a majority of its revenues from investment-grade customers, mitigating counterparty risk.
Fitch anticipates DT Midstream's leverage to decrease to approximately 3.2x in 2024, down from 3.5x in 2023, reflecting strong financial health. The company's revenues are 100% fee-based, with about 70% derived from minimum volume commitments and demand charges in 2023, ensuring stable cash flow.
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