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Second Quarter 2025 Earnings SupplementAugust 7, 2025 | TARGA RESOURCES CORP.
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Forward Looking Statements 2 Certain statements in this presentation are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included in this presentation that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future, are forward-looking statements, including statements regarding our projected financial performance, capital spending and payment of future dividends. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties, factors and risks, many of which are outside the Company’s control, which could cause results to differ materially from those expected by management of the Company. Such risks and uncertainties include, but are not limited to, actions taken by other countries with significant hydrocarbon production, weather, political, economic and market conditions, including a decline in the price and market demand for natural gas, natural gas liquids and crude oil, the timing and success of our completion of capital projects and business development efforts, the expected growth of volumes on our systems, the impact of significant public health crises, commodity price volatility due to ongoing or new global conflicts, the impact of disruptions in the bank and capital markets, changes in laws and regulations, particularly with regard to taxes, tariffs and international trade, and other uncertainties. These and other applicable uncertainties, factors and risks are described more fully in the Company’s filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K, and any subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. The Company does not undertake an obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.We use any of the following to comply with our disclosure obligations under Regulation FD: press releases, SEC filings, public conference calls, or our website. We routinely post important information on our website at www.targaresources.com, including information that may be deemed to be material. We encourage investors and others interested in the company to monitor these distribution channels for material disclosures.Q 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO N
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G&P segment operating margin increased $15 million(1) +Higher Permian inlet volumes−Higher operating expenses associated with higher volumes and multiple new Permian plants in-serviceG&A and Other+Reduction in non-controlling interests attributable to Badlands transaction and acquisition of CBF minority interestL&T segment operating margin increased $85 million+Higher NGL pipeline transportation and fractionation volumes+Higher LPG export volumes−Higher operating expenses associated with the addition of the Daytona Pipeline, fractionation expansions and a planned turnaround at Mont Belvieu Financial Performance – 2Q 2024 vs. 2Q 2025 3Note: Adjusted EBITDA is a non-GAAP measure. Please see the section of this presentation entitled “Non-GAAP Financial Measures” for a discussion of adjusted EBITDA and a reconciliation of such measure to its most directly comparable GAAP financial measure. (1)Inclusive of realized hedge gain/(loss). 18% increase in Adjusted EBITDA Q 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO N2Q24Adjusted EBITDAG&PAdjusted Operating MarginG&POpexL&TAdjusted Operating MarginL&TOpexG&A and Other 2Q25Adjusted EBITDA $ in millions$0 $200 $400 $600 $800 $1,000 $1,200
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Financial Performance – 1Q 2025 vs. 2Q 2025 4Note: Adjusted EBITDA is a non-GAAP measure. Please see the section of this presentation entitled “Non-GAAP Financial Measures” for a discussion of adjusted EBITDA and a reconciliation of such measure to its most directly comparable GAAP financial measure. (1)Inclusive of realized hedge gain/(loss).G&P segment operating margin decreased $15 million(1)−Lower commodity prices−Higher operating expenses associated with increased volumes and multiple new Permian plants in-service+Higher Permian volumesL&T segment operating margin decreased $14 million−Lower marketing margin−Lower fractionation volumes attributable to a planned turnaround at Mont Belvieu facilities−Higher operating expenses associated with the turnaround+Higher NGL transport volumes 1% decrease in Adjusted EBITDA Q 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO N1Q25Adjusted EBITDAG&PAdjusted Operating MarginG&POpexL&TAdjusted Operating MarginL&TOpexG&A and Other 2Q25Adjusted EBITDA $ in millions$0 $200 $400 $600 $800 $1,000 $1,200
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9029541,09098096902004006008001,0002Q24 3Q24 4Q24 1Q25 2Q25MBbl/d5,6725,9446,0656,0066,2781,2521,2241,1961,1221,21702004006008001,0002,0004,0006,0008,0002Q24 3Q24 4Q24 1Q25 2Q25 NGL Production (MBbl/d) Inlet Volumes (MMcf/d)PermianCentral and BadlandsNGL Production12.0 12.4 14.0 13.4 12.8 0.02.04.06.08.010.012.014.02Q24 3Q24 4Q24 1Q25 2Q25MMBbl/Month Operational Performance 5 Field G&P Natural Gas Inlet Volumes Q 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO N(1)(1)Targa supply volumes from its G&P systems were negatively impacted by weather events in 1Q25. 1Q25 and 2Q25 fractionation volumes were also impacted by a major planned turnaround at Targa’s facilities in Mont Belvieu, TX. LPG export volumes were negatively impacted by weather events in 1Q25.(2)Volumes were impacted by a required 10-year inspection that reduced our loading capabilities in 2Q24 and 3Q24. NGL Pipeline Transportation VolumesFractionation Volumes Export Volumes784829872844961020040060080010002Q24 3Q24 4Q24 1Q25 2Q25MBbl/d(1)(1)(1)(2)(2)(1)
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48%52%Gathering & ProcessingLogistics & TransportationBusiness Mix – 2Q 2025 6(1)Fully consolidated operating margin and excludes Coastal.(2)Marketing & Other includes Domestic NGL Marketing, Wholesale Propane, Refinery Services, Commercial Transportation, and Gas Marketing. Field Gathering & ProcessingOperating Margin(1)Business Mix – SegmentOperating MarginLogistics & Transportation Operating Margin Q 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO N(2)0%25%50%75%100%1CentralBadlandsPermian0%25%50%75%100%2Q25EMarketing & OtherLPG ExportsNGL Transportation & Services
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48%52%Gathering & ProcessingLogistics & TransportationBusiness Mix – YTD 2025 7(1)Fully consolidated operating margin and excludes Coastal.(2)Marketing & Other includes Domestic NGL Marketing, Wholesale Propane, Refinery Services, Commercial Transportation, and Gas Marketing. Field Gathering & ProcessingOperating Margin(1)Business Mix – SegmentOperating MarginLogistics & Transportation Operating Margin Q 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO N(2)0%25%50%75%100%YTD 2025CentralBadlandsPermian0%25%50%75%100%YTD 2025Marketing & OtherLPG ExportsNGL Transportation & Services
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2025 Financial OutlookFY25 Adjusted EBITDA estimated to be in a range of $4.65 to $4.85B 8Continued growth in Adjusted EBITDA driven by:Record volumes across Targa’s Permian footprintRecord volumes through integrated NGL transport, fractionation and export systemsBadlands transactionStrength and durability of cash flows underpinned by 90%+ fee-based profile2025 Estimates $4,650 - $4,850 millionAdjusted EBITDA~$3,000 millionNet Growth Capex~$250 millionNet Maintenance CapexQ 2 2 0 2 5 E A R NIN G S S UP P L E ME N T P R E S E NTA TIO NNote: Adjusted EBITDA is a non-GAAP measure. Please see the section of this presentation entitled “Non-GAAP Financial Measures” for a discussion of adjusted EBITDA and a reconciliation of such measures to its most directly comparable GAAP financial measure. 2025 Growth Capital Spending:Significant capacity being added across Targa's integrated Permian business to accommodate anticipated multi-year volume growth underpinned by leading Permian producer customersIncreasing FY25 growth capex estimate with announcement of Bull Run Extension in the Permian Delaware, early completion of several projects and acquiring long-lead items for Targa’s next gas processing expansions in the Permian
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9Appendix and ReconciliationsQ 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO N
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Non-GAAP Financial MeasuresThis presentation includes the Company’s non-GAAP financial measures: adjusted EBITDA and adjusted operating margin. The following tables provide reconciliations of these non-GAAP financial measures to their most directly comparable GAAP measures.The Company utilizes non-GAAP measures to analyze the Company’s performance. Adjusted EBITDA and adjusted operating margin (segment) are non-GAAP measures. The GAAP measures most directly comparable to these non-GAAP measures are income (loss) from operations, Net income (loss) attributable to Targa Resources Corp. and segment operating margin. These non-GAAP measures should not be considered as an alternative to GAAP measures and have important limitations as analytical tools. Investors should not consider these measures in isolation or as a substitute for analysis of the Company’s results as reported under GAAP. Additionally, because the Company’s non-GAAP measures exclude some, but not all, items that affect income and segment operating margin, and are defined differently by different companies within the Company’s industry, the Company’s definitions may not be comparable with similarly titled measures of other companies, thereby diminishing their utility. Management compensates for the limitations of the Company’s non-GAAP measures as analytical tools by reviewing the comparable GAAP measures, understanding the differences between the measures and incorporating these insights into the Company’s decision-making processes.Adjusted EBITDAThe Company defines adjusted EBITDA as Net income (loss) attributable to Targa Resources Corp. before interest, income taxes, depreciation and amortization, and other items that the Company believes should be adjusted consistent with the Company’s core operating performance. The adjusting items are detailed in the adjusted EBITDA reconciliation table and its footnotes. Adjusted EBITDA is used as a supplemental financial measure by the Company and by external users of the Company’s financial statements such as investors, commercial banks and others to measure the ability of the Company’s assets to generate cash sufficient to pay interest costs, support the Company’s indebtedness and pay dividends to the Company’s investors.Adjusted Cash Flow from Operations and Adjusted Free Cash Flow The Company defines adjusted cash flow from operations as adjusted EBITDA less cash interest expense on debt obligations and cash tax (expense) benefit. The Company defines adjusted free cash flow as adjusted cash flow from operations less maintenance capital expenditures (net of any reimbursements of project costs) and growth capital expenditures (net of contributions from noncontrolling interest and including contributions to investments in unconsolidated affiliates). Adjusted cash flow from operations and adjusted free cash flow are performance measures used by the Company and by external users of the Company’s financial statements, such as investors, commercial banks and research analysts, to assess the Company’s ability to generate cash earnings (after servicing the Company’s debt and funding capital expenditures) to be used for corporate purposes, such as payment of dividends, retirement of debt or redemption of other financing arrangements.Adjusted Operating MarginThe Company defines adjusted operating margin for our segments as revenues less product purchases and fuel. It is impacted by volumes and commodity prices as well as by our contract mix and commodity hedging program. Gathering and Processing adjusted operating margin consists primarily of: •Service fees related to natural gas and crude oil gathering, treating and processing; and revenues from the sale of natural gas, condensate, crude oil and NGLs less producer settlements, fuel and transport and the Company’s equity volume hedge settlements. Logistics and Transportation adjusted operating margin consists primarily of:•Service fees (including the pass-through of energy costs included in fee rates); system product gains and losses; and NGL and natural gas sales, less NGL and natural gas purchases, fuel, third-party transportation costs and the net inventory change.•Adjusted operating margin for the Company’s segments provides useful information to investors because it is used as a supplemental financial measure by management and by external users of our financial statements, including investors and commercial banks, to assess: •The financial performance of the Company’s assets without regard to financing methods, capital structure or historical cost basis; the Company’s operating performance and return on capital as compared to other companies in the midstream energy sector, without regard to financing or capital structure; and the viability of capital expenditure projects and acquisitions and the overall rates of return on alternative investment opportunities. 10Q 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO N
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Non-GAAP Measures Reconciliation 11(1)Represents adjustments related to the Company’s subsidiaries with noncontrolling interests, including depreciation and amortization expense as well as earnings for certain plants within Targa’s WestTX joint venture not subject to noncontrolling interest accounting.(2)Litigation expense includes charges related to litigation resulting from the major winter storm in February 2021 that we consider outside the ordinary course of our business and/or not reflective of our ongoing core operations.Q 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO N June 30, 2025 March 31, 2025 June 30, 2024Reconciliation of Net income (loss) attributable to Targa Resources Corp. to Adjusted EBITDANet income (loss) attributable to Targa Resources Corp.629.1$ 270.5$ 298.5$ Interest (income) expense, net218.4 197.1 176.0Income tax expense (benefit)184.1 72.2 94.3Depreciation and amortization expense373.7 367.6 348.6(Gain) loss on sale or disposition of assets(0.7) (0.5) (0.6)Write-down of assets9.6 2.0 0.3(Gain) loss from financing activities— 0.6 0.8Equity (earnings) loss(5.1) (5.5) (2.9)Distributions from unconsolidated affiliates6.2 4.9 5.9Compensation on equity grants17.1 17.6 15.1Risk management activities(280.5) 248.8 46.6Noncontrolling interests adjustments(1)2.5 3.2 1.7Litigation Expense(2)8.6 — —A djusted EBITDA 1,163.0$ 1,178.5$ 984.3$ Three Months Ended,(in millions)
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Non-GAAP Measures Reconciliation 12Q 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO NJune 30, 2025 March 31, 2025 June 30, 2024Gathering and Processing SegmentOperating margin 587.6$ 602.2$ 572.6$ Operating expenses 219.4 208.2 205.7Adjusted operating margin807.0$ 810.4$ 778.3$ Logistics and Transportation SegmentOperating margin 632.4$ 646.7$ 547.7$ Operating expenses 105.4 95.5 85.4Adjusted operating margin737.8$ 742.2$ 633.1$ Three Months Ended,(in millions)
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Non-GAAP Measures Reconciliation 13Q 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO N(1)Represents adjustments related to the Company’s subsidiaries with noncontrolling interests, including depreciation and amortization expense as well as earnings for certain plants within Targa’s WestTX joint venture not subject to noncontrolling interest accounting. Full Year 2025E(in millions)Reconciliation of Estimated Net Income attributable to Targa Resources Corp. to Estimated Adjusted EBITDANet income attributable to Targa Resources Corp.1,830$ Interest expense, net 865 Income tax expense 485 Depreciation and amortization expense 1,510 Equity earnings (22) Distributions from unconsolidated affiliates 26 Compensation on equity grants 70 Risk management and other (17) Noncontrolling interests adjustments(1)3 Estimated Adjusted EBITDA 4,750$
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Targa is a leading provider of midstream services and is one of the largest independent infrastructure companies in North America.Our operations are critical to the efficient, safe, and reliable delivery of energy across the United States and increasingly to the world. Our assets connect natural gas and natural gas liquids (NGLs) to domestic and international markets with growing demand for cleaner fuels and feedstocks.14 Q 2 2 0 2 5 E A R NIN G S S UP P L E ME N TP RE S E N TA TIO N INVESTORRELATIONS@TARGARESOURCES.COMWWW.TARGARESOURCES.COM