FTAI Infrastructure Inc. 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help you understand FTAI Infrastructure Inc. (“we”, “us”, “our”, or the “Company”). Our MD&A should be read in conjunction with our unaudited consolidated financial statements and the accompanying notes, and with Part II, Item 1A, “Risk Factors” and “Forward-Looking Statements” included elsewhere in this Quarterly Report on Form 10-Q. Overview We are in the business of acquiring, developing and operating assets and businesses that represent critical infrastructure for customers in the transportation, energy and industrial products industries. We were formed on December 13, 2021 as FTAI Infrastructure LLC, a Delaware limited liability company and subsidiary of FTAI Aviation Ltd. (previously Fortress Transportation and Infrastructure Investors LLC; “FTAI” or “Former Parent”). We are a publicly-traded company trading on The Nasdaq Global Select Market under the symbol “FIP.” Our operations consist of four primary business lines: (i) Railroad, (ii) Ports and Terminals, (iii) Power and Gas and (iv) Sustainability and Energy Transition. Our Railroad business primarily invests in and operates short line and regional railroads in North America. Our Ports and Terminals business, consisting of our Jefferson Terminal and Repauno segments, develops or acquires industrial properties in strategic locations that store and handle for third parties a variety of energy products, including crude oil, refined products and clean fuels. Our Power and Gas business develops and operates facilities, such as a 485 megawatt power plant at the Long Ridge terminal in Ohio, that leverage the property’s location and key attributes to generate incremental value. Our Sustainability and Energy Transition business focuses on investments in companies and assets that utilize green technology, produce sustainable fuels and products or enable customers to reduce their carbon footprint. We expect to continue to invest in such market sectors, and pursue additional investment opportunities in other infrastructure businesses and assets we believe to be attractive and meet our investment objectives. Our team focuses on acquiring a diverse group of long-lived assets or operating businesses that provide mission-critical services or functions to infrastructure networks and typically have high barriers to entry, strong margins, stable cash flows and upside from earnings growth and asset appreciation driven by increased use and inflation. We believe that there are a large number of acquisition opportunities in our markets and that our Manager’s expertise and business and financing relationships, together with our access to capital and generally available capital for infrastructure projects in today’s marketplace, will allow us to take advantage of these opportunities. As of March 31, 2025, we had total consolidated assets of $4.1 billion and redeemable preferred stock and equity of $0.9 billion. Operating Segments Our reportable segments represent strategic business units comprised of investments in different types of infrastructure assets. We have five reportable segments which operate in infrastructure businesses across several market sectors, all in North America. Our reportable segments are (i) Railroad, (ii) Jefferson Terminal, (iii) Repauno, (iv) Power and Gas and (v) Sustainability and Energy Transition. The Railroad segment is comprised of six freight railroads and one switching company that provide rail service to certain manufacturing and production facilities, in addition to KRS, a railcar cleaning operation. The Jefferson Terminal segment consists of a multi-modal crude oil and refined products terminal, Jefferson Terminal South and other related assets. The Repauno segment consists of a 1,630-acre deep-water port located along the Delaware River with an underground storage cavern, a multipurpose dock, a rail-to-ship transloading system and multiple industrial development opportunities. The Power and Gas segment is comprised of Long Ridge, which is a 1,660-acre multi-modal terminal located along the Ohio River with rail, dock, and multiple industrial development opportunities, including a power plant in operation. The Sustainability and Energy Transition segment is comprised of Aleon/Gladieux, Clean Planet, and CarbonFree, and all three investments are development stage businesses focused on sustainability and recycling. Corporate and Other primarily consists of unallocated corporate general and administrative expenses, management fees, debt and redeemable preferred stock. Additionally, Corporate and Other includes an investment in an unconsolidated entity engaged in the acquisition and leasing of shipping containers and an operating company that provides roadside assistance services for the intermodal and over-the-road trucking industries. Our Manager On May 14, 2024, certain members of Fortress management and affiliates of Mubadala Investment Company, through its wholly owned asset management subsidiary, Mubadala Capital (“Mubadala”), completed their acquisition of 100% of the equity of Fortress. Fortress continues to operate as an independent investment manager under the Fortress brand, with autonomy over investment processes and decision making, personnel and operations. 44 Results of Operations Adjusted EBITDA (Non-GAAP) The chief operating decision maker (“CODM”) utilizes Adjusted EBITDA as the key performance measure. Adjusted EBITDA is not a financial measure in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). This performance measure provides the CODM with the information necessary to assess operational performance, as well as make resource and allocation decisions. We believe Adjusted EBITDA is a useful metric for investors and analysts for similar purposes of assessing our operational performance. Adjusted EBITDA is defined as net income (loss) attributable to stockholders, adjusted (a) to exclude the impact of provision for (benefit from) income taxes, equity-based compensation expense, acquisition and transaction expenses, losses on the modification or extinguishment of debt and capital lease obligations, changes in fair value of non-hedge derivative instruments, asset impairment charges, incentive allocations, depreciation and amortization expense, interest expense, interest and other costs on pension and OPEB liabilities, dividends and accretion of redeemable preferred stock, and other non-recurring items, (b) to include the impact of our pro-rata share of Adjusted EBITDA from unconsolidated entities, and (c) to exclude the impact of equity in earnings (losses) of unconsolidated entities and the non-controlling share of Adjusted EBITDA . We believe that net income (loss) attributable to stockholders, as defined by U.S. GAAP, is the most appropriate earnings measure with which to reconcile Adjusted EBITDA. Adjusted EBITDA should not be considered as an alternative to net income (loss) attributable to stockholders as determined in accordance with U.S. GAAP. 45 Comparison of the three months ended March 31, 2025 and 2024 The following table presents our results of operations: Three Months Ended March 31, Change (in thousands) 2025 2024 Revenues Lease income $ 1,337 $ 1,208 $ 129 Rail revenues 42,174 45,901 (3,727) Terminal services revenues 22,705 21,897 808 Roadside services revenues 12,976 13,528 (552) Power revenues 15,780 — 15,780 Gas revenues 1,188 — 1,188 Other revenue 1 1 — Total revenues 96,161 82,535 13,626 Expenses Operating expenses 67,045 64,575 2,470 General and administrative 5,113 4,861 252 Acquisition and transaction expenses 3,515 926 2,589 Management fees and incentive allocation to affiliate 2,542 3,001 (459) Depreciation and amortization 25,012 20,521 4,491 Asset impairment 1,375 — 1,375 Total expenses 104,602 93,884 10,718 Other income (expense) Equity in earnings (losses) of unconsolidated entities 6,689 (11,902) 18,591 Gain (loss) on sale of assets, net 119,828 (13) 119,841 Loss on modification or extinguishment of debt (7) — (7) Interest expense (43,112) (27,593) (15,519) Other income 3,693 2,365 1,328 Total other income (expense) 87,091 (37,143) 124,234 Income (loss) from before income taxes 78,650 (48,492) 127,142 (Benefit from) provision for income taxes (41,514) 1,805 (43,319) Net income (loss) 120,164 (50,297) 170,461 Less: Net loss attributable to non-controlling interest in consolidated subsidiaries (11,401) (10,690) (711) Less: Dividends and accretion of redeemable preferred stock 21,841 16,975 4,866 Net income (loss) attributable to stockholders $ 109,724 $ (56,582) $ 166,306 46 The following table sets forth a reconciliation of net income (loss) attributable to stockholders to Adjusted EBITDA: Three Months Ended March 31, Change (in thousands) 2025 2024 Net income (loss) attributable to stockholders $ 109,724 $ (56,582) $ 166,306 Add: (Benefit from) provision for income taxes (41,514) 1,805 (43,319) Add: Equity-based compensation expense 1,253 2,340 (1,087) Add: Acquisition and transaction expenses 3,515 926 2,589 Add: Losses on the modification or extinguishment of debt and capital lease obligations 7 — 7 Add: Changes in fair value of non-hedge derivative instruments — — — Add: Asset impairment charges 1,375 — 1,375 Add: Incentive allocations — — — Add: Depreciation and amortization expense (1) 24,657 21,097 3,560 Add: Interest expense 43,112 27,593 15,519 Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities (2) 4,500 6,257 (1,757) Add: Dividends and accretion of redeemable preferred stock 21,841 16,975 4,866 Add: Interest and other costs on pension and OPEB liabilities (265) 600 (865) Add: Other non-recurring items (3) 1,035 — 1,035 Less: Equity in (earnings) losses of unconsolidated entities (6,689) 11,902 (18,591) Less: Non-controlling share of Adjusted EBITDA (4) (7,332) (5,682) (1,650) Adjusted EBITDA (Non-GAAP) $ 155,219 $ 27,231 $ 127,988 ________________________________________________________ (1) Includes the following items for the three months ended March 31, 2025 and 2024: (i) depreciation and amortization expense of $25,012 and $20,521, (ii) capitalized contract costs amortization of $1,233 and $576 and (iii) amortization of other comprehensive income of $(1,588) and $—, respectively. (2) Includes the following items for the three months ended March 31, 2025 and 2024: (i) net income (loss) of $6,578 and $(11,942), (ii) interest expense of $7,648 and $10,893, (iii) depreciation and amortization expense of $2,884 and $5,130, (iv) acquisition and transaction expenses of $201 and $19, (v) changes in fair value of non-hedge derivative instruments of $(12,822) and $2,053, (vi) equity-based compensation expense of $— and $1, (vii) asset impairment charges of $— and $87, (viii) equity method basis adjustments of $10 and $16 and (ix) other non-recurring items of $1 and $—, respectively. (3) Includes the following items for the three months ended March 31, 2025: (i) incidental utility rebillings of $650 and (ii) loss on inventory heel of $385. (4) Includes the following items for the three months ended March 31, 2025 and 2024: (i) equity-based compensation expense of $138 and $431, (ii) provision for (benefit from) income taxes of $104 and $(134), (iii) interest expense of $3,940 and $2,189, (iv) depreciation and amortization expense of $3,069 and $3,194, (v) acquisition and transaction expenses of $1 and $—, (vi) interest and other costs on pension and OPEB liabilities of $(2) and $2, (vii) asset impairment charges of $19 and $—, (viii) losses on the modification or extinguishment of debt of $2 and $— and (ix) other non-recurring items of $61 and $—, respectively. Revenue Comparison of the three months ended March 31, 2025 and 2024 Total revenues increased $13.6 million due to higher revenues of $17.3 million in the Power and Gas segment and $0.8 million in the Jefferson Terminal segment, offset by lower revenues of $3.7 million in the Railroad segment, $0.3 million in the Repauno segment and $0.6 million in the Corporate and Other segment. Roadside services revenue decreased $0.6 million due to the decline of roadside services for FYX. Terminal services revenues increased $0.8 million primarily due an increase in average crude oil throughput volumes in the Jefferson Terminal segment. Rail revenues decreased $3.7 million primarily due to a decrease in both carloads and rates per car in the Railroad segment. Power revenues increased $15.8 million due to the acquisition of Long Ridge Energy & Power LLC in February 2025. Gas revenues increased $1.2 million due to the acquisition of Long Ridge Energy & Power LLC in February 2025. 47 Expenses Comparison of the three months ended March 31, 2025 and 2024 Total expenses increased $10.7 million, primarily due to increases in (i) operating expenses, (ii) depreciation and amortization, (iii) acquisition and transaction expenses and (iv) asset impairment. Operating expenses increased $2.5 million which primarily reflects: • an increase of $5.6 million primarily related to increased Ohio Gasco LLC drilling expenses as well as increased legal expenses in the Power and Gas Segmen t ; and • an increase of $0.5 million in the Repauno segment due to costs associated with labor costs and professional fees related to the continued development of the site; partially offset by • a decrease of $0.7 million due to decreased roadside services at FYX; • a decrease of $1.0 million primarily due to lower costs associated with stock-based compensation and insurance during the current quarter in the Jefferson Terminal segment; and • a decrease of $1.9 million in the Railroad segment mainly due to decreased carloads. Acquisition and transaction expenses increased $2.6 million primarily due to legal fees in the Power and Gas segment related to the acquisition of Long Ridge Energy & Power LLC in February 2025. Depreciation and amortization increased $4.5 million primarily due to additional assets at Long Ridge Energy & Power LLC after the acquisition in February 2025. Asset impairment increased $1.4 million primarily due to the write-off of the remaining GM-FTAI note receivable in the Sustainability and Energy Transition segment. Other income (expense) Total other income increased $124.2 million primarily due to: • an increase of $18.6 million in equity in earnings of unconsolidated entities primarily due to the equity pickup of Long Ridge Energy & Power LLC before the acquisition in February 2025; • a gain on sale of assets of $119.8 million primarily due to the acquisition of Long Ridge Energy & Power LLC in February 2025; and • an increase of $1.3 million in other income due to favorable adjustments in the pension and OPEB benefits in the Railroad segment, and an increase due to the interest on the Series 2024 Bond funds at the Jefferson Terminal segment; partially offset by • an increase in interest expense of $15.5 million primarily due to an increase in the average outstanding debt of approximately $1.0 billion which consists of (i) $6.1 million for the Senior Notes due 2027, (ii) $10.0 million for the DRP Credit Agreement, (iii) $234.7 million for the Series 2024 Bonds and (iv) $756.8 million for Long Ridge Energy & Power LLC debt. (Benefit from) provision for income taxes Benefit from income taxes increased $43.3 million primarily due to the partial release of the valuation allowance in connection with the acquisition of Long Ridge Energy & Power LLC in February 2025. Net income (loss) Net income increased $170.5 million during the three months ended March 31, 2025, primarily due to the changes noted above. Adjusted EBITDA (Non-GAAP) Adjusted EBITDA increased $128.0 million during the three months ended March 31, 2025, primarily due to the changes noted above. 48 Railroad Segment The following table presents our results of operations: Three Months Ended March 31, Change (in thousands) 2025 2024 Revenues Lease income $ 457 $ 411 $ 46 Rail revenues 42,174 45,901 (3,727) Total revenues 42,631 46,312 (3,681) Expenses Operating expenses 22,939 24,842 (1,903) Acquisition and transaction expenses 93 184 (91) Depreciation and amortization 5,086 5,012 74 Total expenses 28,118 30,038 (1,920) Other (expense) income Loss on sale of assets, net (124) (13) (111) Interest expense (139) (69) (70) Other income (expense) 388 (603) 991 Total other income (expense) 125 (685) 810 Income before income taxes 14,638 15,589 (951) Provision for income taxes 812 1,092 (280) Net income 13,826 14,497 (671) Less: Net income attributable to non-controlling interest in consolidated subsidiaries 87 61 26 Net income attributable to stockholders $ 13,739 $ 14,436 $ (697) 49 The following table sets forth a reconciliation of net income attributable to stockholders to Adjusted EBITDA: Three Months Ended March 31, Change (in thousands) 2025 2024 Net income attributable to stockholders $ 13,739 $ 14,436 $ (697) Add: Provision for income taxes 812 1,092 (280) Add: Equity-based compensation expense 358 290 68 Add: Acquisition and transaction expenses 93 184 (91) Add: Losses on the modification or extinguishment of debt and capital lease obligations — — — Add: Changes in fair value of non-hedge derivative instruments — — — Add: Asset impairment charges — — — Add: Incentive allocations — — — Add: Depreciation and amortization expense 5,086 5,012 74 Add: Interest expense 139 69 70 Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities — — — Add: Dividends and accretion of redeemable preferred stock — — — Add: Interest and other costs on pension and OPEB liabilities (265) 600 (865) Add: Other non-recurring items — — — Less: Equity in earnings of unconsolidated entities — — — Less: Non-controlling share of Adjusted EBITDA (1) (38) (25) (13) Adjusted EBITDA (Non-GAAP) $ 19,924 $ 21,658 $ (1,734) ________________________________________________________ (1) Includes the following items for the three months ended March 31, 2025 and 2024: (i) equity-based compensation expense of $2 and $1, (ii) provision for income taxes of $5 and $4, (iii) interest expense of $1 and $—, (iv) depreciation and amortization expense of $31 and $18, (v) acquisition and transaction expenses of $1 and $— and (vi) interest and other costs on pension and OPEB liabilities of $(2) and $2, respectively. Revenues Total revenues decreased $3.7 million during the three months ended March 31, 2025, respectively, primarily due to both a decrease in carloads and rates per car. Expenses Total expenses decreased $1.9 million during the three months ended March 31, 2025, which primarily reflects a decrease in operating expenses of $1.9 million mainly due to decreased carloads. Other (expense) income Total other income increased $0.8 million during the three months ended March 31, 2025, which primarily reflects an increase in other income related to pension and OPEB benefits due to favorable adjustments. Adjusted EBITDA (Non-GAAP) Adjusted EBITDA decreased $1.7 million during the three months ended March 31, 2025, primarily due to the activity noted above. 50 Jefferson Terminal Segment The following table presents our results of operations: Three Months Ended March 31, Change (in thousands) 2025 2024 Revenues Lease income $ 880 $ 797 $ 83 Terminal services revenues 18,569 17,819 750 Total revenues 19,449 18,616 833 Expenses Operating expenses 18,094 19,132 (1,038) Acquisition and transaction expenses (1) 2 (3) Depreciation and amortization 11,240 12,330 (1,090) Total expenses 29,333 31,464 (2,131) Other (expense) income Loss on modification or extinguishment of debt (7) — (7) Interest expense (16,624) (9,297) (7,327) Other income 726 6 720 Total other expense (15,905) (9,291) (6,614) Loss before income taxes (25,789) (22,139) (3,650) Provision for (benefit from) income taxes 423 (554) 977 Net loss (26,212) (21,585) (4,627) Less: Net loss attributable to non-controlling interest in consolidated subsidiaries (11,084) (10,465) (619) Net loss attributable to stockholders $ (15,128) $ (11,120) $ (4,008) 51 The following table sets forth a reconciliation of net loss attributable to stockholders to Adjusted EBITDA: Three Months Ended March 31, Change (in thousands) 2025 2024 Net loss attributable to stockholders $ (15,128) $ (11,120) $ (4,008) Add: Provision for (benefit from) income taxes 423 (554) 977 Add: Equity-based compensation expense 508 1,759 (1,251) Add: Acquisition and transaction expenses (1) 2 (3) Add: Losses on the modification or extinguishment of debt and capital lease obligations 7 — 7 Add: Changes in fair value of non-hedge derivative instruments — — — Add: Asset impairment charges — — — Add: Incentive allocations — — — Add: Depreciation and amortization expense (1) 12,473 12,906 (433) Add: Interest expense 16,624 9,297 7,327 Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities — — — Add: Dividends and accretion of redeemable preferred stock — — — Add: Interest and other costs on pension and OPEB liabilities — — — Add: Other non-recurring items — — — Less: Equity in earnings of unconsolidated entities — — — Less: Non-controlling share of Adjusted EBITDA (2) (6,956) (5,489) (1,467) Adjusted EBITDA (Non-GAAP) $ 7,950 $ 6,801 $ 1,149 ________________________________________________________ (1) Includes the following items for the three months ended March 31, 2025 and 2024: (i) depreciation and amortization expense of $11,240 and $12,330 and (ii) capitalized contract costs amortization of $1,233 and $576, respectively. (2) Includes the following items for the three months ended March 31, 2025 and 2024: (i) equity-based compensation expense of $118 and $412, (ii) provision for (benefit from) income taxes of $98 and $(130), (iii) interest expense of $3,849 and $2,180, (iv) depreciation and amortization expense of $2,889 and $3,027 and (v) losses on the modification or extinguishment of debt of $2 and $—, respectively. Revenues Total revenues increased $0.8 million during the three months ended March 31, 2025 due to an increase in average crude oil throughput volumes. Expenses Total expenses decreased $2.1 million during the three months ended March 31, 2025 which primarily reflects: • a decrease in operating expenses of $1.0 million primarily due to lower costs associated with stock-based compensation and insurance during the current quarter; and • a decrease in depreciation and amortization of $1.1 million due to certain assets becoming fully depreciated. Other (expense) income Total other expense increased $6.6 million during the three months ended March 31, 2025, which primarily reflects an increase in interest expense of $7.3 million related to additional borrowings issued in June 2024, partially offset by an increase in other income of $0.7 million from the interest on the Series 2024 Bond funds. Adjusted EBITDA (Non-GAAP) Adjusted EBITDA increased $1.1 million during the three months ended March 31, 2025, primarily due to the changes noted above. 52 Repauno Segment The following table presents our results of operations: Three Months Ended March 31, Change (in thousands) 2025 2024 Revenues Terminal services revenues $ 3,810 $ 4,078 $ (268) Other revenue 1 1 — Total revenues 3,811 4,079 (268) Expenses Operating expenses 6,666 6,171 495 Acquisition and transaction expenses 316 — 316 Depreciation and amortization 2,496 2,444 52 Total expenses 9,478 8,615 863 Other expense Interest expense (1,518) (146) (1,372) Total other expense (1,518) (146) (1,372) Loss before income taxes (7,185) (4,682) (2,503) Provision for (benefit from) income taxes 12 (136) 148 Net loss (7,197) (4,546) (2,651) Less: Net loss attributable to non-controlling interest in consolidated subsidiaries (404) (286) (118) Net loss attributable to stockholders $ (6,793) $ (4,260) $ (2,533) 53 The following table sets forth a reconciliation of net loss attributable to stockholders to Adjusted EBITDA: Three Months Ended March 31, Change (in thousands) 2025 2024 Net loss attributable to stockholders $ (6,793) $ (4,260) $ (2,533) Add: Provision for (benefit from) income taxes 12 (136) 148 Add: Equity-based compensation expense 302 291 11 Add: Acquisition and transaction expenses 316 — 316 Add: Losses on the modification or extinguishment of debt and capital lease obligations — — — Add: Changes in fair value of non-hedge derivative instruments — — — Add: Asset impairment charges — — — Add: Incentive allocations — — — Add: Depreciation and amortization expense 2,496 2,444 52 Add: Interest expense 1,518 146 1,372 Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities — — — Add: Dividends and accretion of redeemable preferred stock — — — Add: Interest and other costs on pension and OPEB liabilities — — — Add: Other non-recurring items (1) 1,035 — 1,035 Less: Equity in earnings of unconsolidated entities — — — Less: Non-controlling share of Adjusted EBITDA (2) (338) (168) (170) Adjusted EBITDA (non-GAAP) $ (1,452) $ (1,683) $ 231 ________________________________________________________ (1) Includes the following items for the three months ended March 31, 2025: (i) incidental utility rebillings of $650 and (ii) loss on inventory heel of $385. (2) Includes the following items for the three months ended March 31, 2025 and 2024: (i) equity-based compensation expense of $18 and $18, (ii) provision for (benefit from) income taxes of $1 and $(8), (iii) interest expense of $90 and $9, (iv) depreciation and amortization expense of $149 and $149, (v) asset impairment charges of $19 and $— and (vi) other non-recurring items of $61 and $—, respectively. Revenues Total revenue decreased $0.3 million during the three months ended March 31, 2025 primarily due to slightly lower volumes stemming from the terminal’s butane throughput contract. Expenses Total expenses increased $0.9 million during the three months ended March 31, 2025 which primarily reflects higher operating expenses due to costs associated with labor costs and professional fees related to the continued development of the site, an increase in depreciation expense due to assets being placed into service, and an increase in acquisition and transaction costs related to a potential financing. Other expense Total other expense increased $1.4 million during the three months ended March 31, 2025, which reflects a reduction in the amount of allowable capitalized interest. Adjusted EBITDA (Non-GAAP) Adjusted EBITDA increased $0.2 million during the three months ended March 31, 2025, primarily due to the changes noted above. 54 Power and Gas Segment The following table presents our results of operations: Three Months Ended March 31, Change (in thousands) 2025 2024 Revenues Terminal services revenues $ 326 $ — $ 326 Power revenues 15,780 — 15,780 Gas revenues 1,188 — 1,188 Total revenues 17,294 — 17,294 Expenses Operating expenses 6,311 692 5,619 Acquisition and transaction expenses 1,069 — 1,069 Depreciation and amortization 6,090 — 6,090 Total expenses 13,470 692 12,778 Other income (expense) Equity in earnings (losses) of unconsolidated entities 10,588 (7,037) 17,625 Gain on sale of assets, net 119,952 — 119,952 Interest expense (9,017) — (9,017) Other income 2,240 2,302 (62) Total other income (expense) 123,763 (4,735) 128,498 Income (loss) before income taxes 127,587 (5,427) 133,014 Benefit from income taxes (42,457) — (42,457) Net income (loss) attributable to stockholders $ 170,044 $ (5,427) $ 175,471 55 The following table sets forth a reconciliation of net income (loss) attributable to stockholders to Adjusted EBITDA: Three Months Ended March 31, Change (in thousands) 2025 2024 Net income (loss) attributable to stockholders $ 170,044 $ (5,427) $ 175,471 Add: Benefit from income taxes (42,457) — (42,457) Add: Equity-based compensation expense — — — Add: Acquisition and transaction expenses 1,069 — 1,069 Add: Losses on the modification or extinguishment of debt and capital lease obligations — — — Add: Changes in fair value of non-hedge derivative instruments — — — Add: Asset impairment charges — — — Add: Incentive allocations — — — Add: Depreciation and amortization expense (1) 4,502 — 4,502 Add: Interest expense 9,017 — 9,017 Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities (2) 6,503 8,782 (2,279) Add: Dividends and accretion of redeemable preferred stock — — — Add: Interest and other costs on pension and OPEB liabilities — — — Add: Other non-recurring items — — — Less: Equity in (earnings) losses of unconsolidated entities (10,588) 7,037 (17,625) Less: Non-controlling share of Adjusted EBITDA — — — Adjusted EBITDA (non-GAAP) $ 138,090 $ 10,392 $ 127,698 ________________________________________________________ (1) Includes the following items for the three months ended March 31, 2025 and 2024: (i) depreciation and amortization expense of $6,090 and $— and (ii) amortization of other comprehensive income of $(1,588) and $—, respectively. (2) Includes the following items for the three months ended March 31, 2025 and 2024: (i) net income (loss) of $10,576 and $(7,053), (ii) interest expense of $6,352 and $9,210, (iii) depreciation and amortization expense of $2,185 and $4,449, (iv) acquisition and transaction expenses of $201 and $19, (v) changes in fair value of non-hedge derivative instruments of $(12,822) and $2,053, (vi) equity-based compensation expense of $— and $1, (vii) asset impairment charges of $— and $87, (viii) equity method basis adjustments of $10 and $16 and (ix) other non-recurring items of $1 and $—, respectively. Revenues Total revenues increased $17.3 million during the three months ended March 31, 2025, primarily due to a $15.8 million increase in power plant revenue as well as a $1.2 million increase in gas revenues as a result of the acquisition of 100% of Long Ridge during the quarter. Expenses Total expenses increased $12.8 million during the three months ended March 31, 2025, which reflects: • an increase in operating expenses of $5.6 million primarily related to increased Ohio Gasco LLC drilling expenses as well as increased legal expenses; • an increase in acquisition and transaction expenses of $1.1 million due to legal fees relating to the acquisition of 100% of Long Ridge; and • an increase in depreciation and amortization expense of $6.1 million related to depreciation expense at the Terminal and Power Plant businesses as a result of the acquisition of 100% of Long Ridge during the quarter. Other income (expense) Total other income increased $128.5 million during the three months ended March 31, 2025 which reflects: • an increase in equity in earnings of unconsolidated entities of $17.6 million, primarily due to the equity pickup of Long Ridge Energy & Power LLC before the acquisition; and • an increase in gain on sale of asset of $120.0 million related to the acquisition of 100% of Long Ridge during the quarter; partially offset by • an increase in interest expense of $9.0 million related to interest expense on the Long Ridge debt that is now consolidated. 56 Benefit from income taxes Benefit from income taxes increased $42.5 million primarily due to the partial release of the valuation allowance in connection with the acquisition of Long Ridge Energy & Power LLC in February 2025. Adjusted EBITDA (Non-GAAP) Adjusted EBITDA increased $127.7 million during the three months ended March 31, 2025, primarily due to the changes noted above. Sustainability and Energy Transition Segment The following table presents our results of operations: Three Months Ended March 31, Change (in thousands) 2025 2024 Revenues Other revenue $ — $ — $ — Total revenues — — — Expenses Asset impairment 1,375 — 1,375 Total expenses 1,375 — 1,375 Other (expense) income Equity in losses of unconsolidated entities (3,949) (4,874) 925 Other income 339 660 (321) Total other expense (3,610) (4,214) 604 Net loss attributable to stockholders $ (4,985) $ (4,214) $ (771) The following table sets forth a reconciliation of net loss attributable to stockholders to Adjusted EBITDA: Three Months Ended March 31, Change (in thousands) 2025 2024 Net loss attributable to stockholders $ (4,985) $ (4,214) $ (771) Add: Provision for income taxes — — — Add: Equity-based compensation expense — — — Add: Acquisition and transaction expenses — — — Add: Losses on the modification or extinguishment of debt and capital lease obligations — — — Add: Changes in fair value of non-hedge derivative instruments — — — Add: Asset impairment charges 1,375 — 1,375 Add: Incentive Allocations — — — Add: Depreciation and amortization expense — — — Add: Interest expense — — — Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities (1) (1,965) (2,519) 554 Add: Dividends and accretion of redeemable preferred stock — — — Add: Interest and other costs on pension and OPEB liabilities — — — Add: Other non-recurring items — — — Less: Equity in losses of unconsolidated entities 3,949 4,874 (925) Less: Non-controlling share of Adjusted EBITDA — — — Adjusted EBITDA (Non-GAAP) $ (1,626) $ (1,859) $ 233 ________________________________________________________ (1) Includes the following items for the three months ended March 31, 2025 and 2024: (i) net loss of $(3,948) and $(4,874), (ii) interest expense of $1,284 and $1,674 and (iii) depreciation and amortization expense of $699 and $681, respectively . 57 Expenses Total expenses increased $1.4 million due to the write-off of the remaining GM-FTAI note receivable. Other (expense) income Total other expense decreased $0.6 million during the three months ended March 31, 2025, which reflects changes in equity in losses of unconsolidated entities primarily due to lower operating losses at GM-FTAI Holdco LLC. Adjusted EBITDA (Non-GAAP) Adjusted EBITDA increased $0.2 million during the three months ended March 31, 2025, primarily due to the changes noted above. Corporate and Other The following table presents our results of operations: Three Months Ended March 31, Change (in thousands) 2025 2024 Revenues Roadside services revenues $ 12,976 $ 13,528 $ (552) Total revenues 12,976 13,528 (552) Expenses Operating expenses 13,035 13,738 (703) General and administrative 5,113 4,861 252 Acquisition and transaction expenses 2,038 740 1,298 Management fees and incentive allocation to affiliate 2,542 3,001 (459) Depreciation and amortization 100 735 (635) Total expenses 22,828 23,075 (247) Other income (expense) Equity in earnings of unconsolidated entities 50 9 41 Interest expense (15,814) (18,081) 2,267 Total other expense (15,764) (18,072) 2,308 Loss before income taxes (25,616) (27,619) 2,003 (Benefit from) provision for income taxes (304) 1,403 (1,707) Net loss (25,312) (29,022) 3,710 Less: Dividends and accretion of redeemable preferred stock 21,841 16,975 4,866 Net loss attributable to stockholders $ (47,153) $ (45,997) $ (1,156) 58 The following table sets forth a reconciliation of net loss attributable to stockholders to Adjusted EBITDA: Three Months Ended March 31, Change (in thousands) 2025 2024 Net loss attributable to stockholders $ (47,153) $ (45,997) $ (1,156) Add: (Benefit from) provision for income taxes (304) 1,403 (1,707) Add: Equity-based compensation expense 85 — 85 Add: Acquisition and transaction expenses 2,038 740 1,298 Add: Losses on the modification or extinguishment of debt and capital lease obligations — — — Add: Changes in fair value of non-hedge derivative instruments — — — Add: Asset impairment charges — — — Add: Incentive allocations — — — Add: Depreciation and amortization expense 100 735 (635) Add: Interest expense 15,814 18,081 (2,267) Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities (1) (38) (6) (32) Add: Dividends and accretion of redeemable preferred stock 21,841 16,975 4,866 Add: Interest and other costs on pension and OPEB liabilities — — — Add: Other non-recurring items — — — Less: Equity in earnings of unconsolidated entities (50) (9) (41) Less: Non-controlling share of Adjusted EBITDA — — — Adjusted EBITDA (Non-GAAP) $ (7,667) $ (8,078) $ 411 ________________________________________________________ (1) Includes the following items for the three months ended March 31, 2025 and 2024: (i) net loss of $(50) and $(15) and (ii) interest expense of $12 and $9, respectively. Revenues Total revenues decreased $0.6 million during the three months ended March 31, 2025, primarily due to a decrease in roadside services at FYX. Expenses Total expenses decreased $0.2 million during the three months ended March 31, 2025 which primarily reflects: • a decrease in operating expenses of $0.7 million due to a decrease in roadside services at FYX; and • a decrease in depreciation and amortization expense of $0.6 million due to assets that became fully depreciated; partially offset by • an increase in acquisition and transaction expenses of $1.3 million primarily due to higher professional fees. Other income (expense) Total other expense decreased $2.3 million during the three months ended March 31, 2025, which primarily reflects an increase in capitalized interest. Adjusted EBITDA (Non-GAAP) Adjusted EBITDA increased $0.4 million during the three months ended March 31, 2025, primarily due to the changes noted above. Liquidity and Capital Resources We believe we have sufficient liquidity to satisfy our cash needs; however, we continue to evaluate and take action, as necessary, to preserve adequate liquidity and ensure that our business can continue to operate during these uncertain times. This includes limiting discretionary spending across the organization and re-prioritizing our capital projects. As disclosed in Note 20, subsequent to March 31, 2025, the Company has (i) executed its Series 2025 Bonds at its Repauno segment in an aggregate principal amount of approximately $300.0 million that will be due on January 1, 2035 and January 1, 2045, (ii) executed a binding loan commitment for $106.0 million at its Repauno segment that will be due in 18 months from initial funding and (iii) executed a loan agreement for $40.0 million at its Power and Gas segment that will be due June 7, 2026. Management has approved a plan to accrue paid-in-kind dividends on the Series A Preferred Stock which would preclude the payment of future dividends on common stock, excluding the current common dividend that our board of directors declared on 59 May 6, 2025 that will be paid on May 27, 2025 (see Note 20). Management concluded that such plans are probable of being implemented and the Company will have sufficient liquidity to meet its obligations as they become due over the next twelve months from the date that the consolidated financial statements were issued. Management will continue to evaluate its liquidity and financial position and update future plans accordingly. Our principal uses of liquidity have been and continue to be (i) acquisitions of and investments in infrastructure assets, (ii) expenses associated with our operating activities and (iii) debt service obligations associated with our investments. • Cash used for the purpose of making investments was $164.2 million and $18.9 million during the three months ended March 31, 2025 and 2024, respectively. • Uses of liquidity associated with our operating expenses are captured on a net basis in our cash flows from operating activities. Uses of liquidity associated with our debt obligations are captured in our cash flows from financing activities. Our principal sources of liquidity to fund these uses have been and continue to be (i) cash and restricted cash on hand as of March 31, 2025, (ii) revenues from our infrastructure business net of operating expenses and (iii) proceeds from borrowings. • Cash flows used in operating activities were $85.7 million and $3.9 million during the three months ended March 31, 2025 and 2024, respectively. • During the three months ended March 31, 2025, additional borrowings were obtained in connection with the March 2025 Repauno Credit Agreement of $30.0 million. Additionally, during the three months ended March 31, 2025, we acquired the (i) Long Ridge CanAm loan of $115.2 million, (ii) Senior Secured Notes due 2032 of $600.0 million, (iii) February 2025 Long Ridge Credit Agreement of $400.0 million and (iv) Long Ridge GCM Note of $20.0 million in connection with the acquisition of Long Ridge Energy & Power LLC (see Note 3 for additional details). During the three months ended March 31, 2024, no additional borrowings were obtained and we did not make any principal repayments of debt. We are currently evaluating several potential transactions and related financings, including, but not limited to, providing for increased debt capacity at certain of our subsidiaries, which could occur within the next 12 months. None of these transactions, negotiations or financings are definitive or included within our planned liquidity needs. We cannot assure if or when any such transaction will be consummated or the terms of any such transaction. In addition, from time to time, we may seek to repay, refinance or restructure all or a portion of our debt or to repurchase or repay our outstanding debt through, as applicable, tender offers, exchange offers, open market purchases, privately negotiated transactions or otherwise. Such transactions, if any, will depend on a number of factors, including prevailing market conditions, our liquidity requirements and contractual requirements (including compliance with the terms of our debt agreements), among other factors. Historical Cash Flow Comparison of the three months ended March 31, 2025 and 2024 The following table compares the historical cash flow for the three months ended March 31, 2025 and 2024: Three Months Ended March 31, (in thousands) 2025 2024 Cash Flow Data: Net cash used in operating activities $ (85,651) $ (3,883) Net cash provided by (used in) investing activities 164,299 (18,846) Net cash used in financing activities (2,537) (454) Net cash used in operating activities increased $81.8 million, which primarily reflects certain adjustments to reconcile net income (loss) to cash used in operating activities including (i) an increase in equity in earnings of unconsolidated entities of $18.6 million, (ii) changes in working capital of $75.1 million, (iii) an increase in gain on sale of subsidiaries of $120.0 million and (iv) changes in deferred income taxes of $43.2 million, partially offset by (i) an increase in net income of $170.5 million and (ii) an increase in depreciation and amortization of $4.5 million. Net cash provided by investing activities increased $183.1 million, primarily due to (i) an increase in the acquisition of business of $226.6 million, (ii) an increase in proceeds from investor loan of $11.0 million and (iii) a decrease in the investment of equity instruments of $5.0 million, partially offset by (i) an increase in the acquisition of property, plant and equipment of $53.1 million and (ii) an increase in the investment in unconsolidated entities of $6.3 million. Net cash used in financing activities increased $2.1 million, primarily due to (i) an increase in the payment of cash dividends on preferred stock of $25.5 million, (ii) an increase in the payment of cash dividends on common stock of $3.4 million, (iii) an increase in redeemable preferred stock issuance costs of $0.0 million and (iv) an increase in payment of financing costs of $1.0 million, partially offset by (i) an increase in proceeds from debt of $28.2 million. Debt Obligations Refer to Note 8 of the consolidated financial statements for additional information. 60 Contractual Obligations Our material cash requirements include the following contractual and other obligations: Debt Obligations — As of March 31, 2025, we had outstanding principal and interest payment obligations of $2.8 billion and $1.2 billion, respectively, of which, there are $94.6 million of principal payments due and $189.5 million of interest payments due within the next twelve months. See Note 8 to the consolidated financial statements for additional information about our debt obligations. Unrestricted subsidiaries of FTAI Infrastructure Inc., including Long Ridge Energy & Power LLC, do not guarantee nor are they subject to the restrictive covenants of the agreements governing the indebtedness of FTAI Infrastructure Inc. As of March 31, 2025, the assets of these unrestricted subsidiaries accounted for approximately 43% of our total assets. Lease Obligations —As of March 31, 2025, we had outstanding operating and finance lease obligations of $171.8 million, of which $8.8 million is due within the next twelve months. Redeemable Preferred Stock Obligations —We have dividend payments of $90.1 million due on our redeemable preferred stock within the next twelve months with an option to paid-in-kind dividends at a higher interest rate and to defer payment for nine months. See Note 17 for additional information related to our preferred stock obligations. Other Cash Requirements —In addition to our contractual obligations, we may pay quarterly cash dividends on our common stock, which are subject to change at the discretion of our board of directors. We expect to meet our future short-term liquidity requirements through cash on hand, unused borrowing capacity or future financings and net cash provided by our current operations. We expect that our operating subsidiaries will generate sufficient cash flow to cover operating expenses and the payment of principal and interest on our indebtedness as they become due. We may elect to meet certain long-term liquidity requirements or to continue to pursue strategic opportunities through utilizing cash on hand, cash generated from our current operations and the issuance of securities in the future. Management believes adequate capital and borrowings are available from various sources to fund our commitments to the extent required. Critical Accounting Estimates and Policies Goodwill — Goodwill includes the excess of the purchase price over the fair value of the net tangible and intangible assets associated with the acquisition of Jefferson Terminal, Transtar and FYX. As of December 31, 2024, the carrying amount of goodwill within the Jefferson Terminal, Railroad and Corporate and Other segments was $122.7 million, $147.2 million, and $5.4 million, respectively. We review the carrying values of goodwill at least annually to assess impairment since these assets are not amortized. An annual impairment review is conducted as of October 1st of each year. Additionally, we review the carrying value of goodwill whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. The determination of fair value involves significant management judgment. For an annual goodwill impairment assessment, an optional qualitative analysis may be performed. If the option is not elected or if it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then a goodwill impairment test is performed to identify potential goodwill impairment and measure an impairment loss. A goodwill impairment assessment compares the fair value of a respective reporting unit with its carrying amount, including goodwill. The estimate of fair value of the respective reporting unit is based on the best information available as of the date of assessment, which primarily incorporates certain factors including our assumptions about operating results, business plans, income projections, anticipated future cash flows and market data. If the estimated fair value of the reporting unit is less than the carrying amount, a goodwill impairment is recorded to the extent that the carrying value of the reporting unit exceeds the fair value. As of October 1, 2024, for our Jefferson Terminal reporting unit, we completed a quantitative analysis. We estimate the fair value of Jefferson Terminal using an income approach, specifically a discounted cash flow analysis. This analysis requires us to make significant assumptions and estimates about the forecasted revenue growth rates, capital expenditures and discount rates. The estimates and assumptions used consider historical performance if indicative of future performance and are consistent with the assumptions used in determining future profit plans for the reporting units. In connection with our impairment analysis, although we believe the estimates of fair value are reasonable, the determination of certain valuation inputs is subject to management's judgment. Changes in these inputs, including as a result of events beyond our control, could materially affect the results of the impairment review. If the forecasted cash flows or other key inputs are negatively revised in the future, the estimated fair value of the reporting unit could be adversely impacted, potentially leading to an impairment in the future that could materially affect our operating results. The Jefferson Terminal reporting unit had an estimated fair value that exceeded its carrying value by more than 10% as of October 1, 2024. The Jefferson Terminal reporting unit forecasted revenue is dependent on the ramp up of volumes under current and expected future contracts for storage and throughput of heavy and light crude and refined products, expansion of refined product distribution to Mexico, expansion of volumes and execution of contracts related to sustainable fuels and movements in future oil spreads. At October 1, 2024, approximately 6.0 million barrels of storage was operational. Our discount rate for our 2024 goodwill impairment analysis was 9.5% and our assumed terminal growth rate was 2.5%. If our strategy changes from planned capacity downward due to an inability to source contracts or expand volumes, the fair value of the reporting unit would be negatively affected, which could lead 61 to an impairment. The expansion of refineries in the Beaumont/Port Arthur area, as well as growing crude oil and natural gas production in the U.S. and Canada, are expected to result in increased demand for storage on the U.S. Gulf Coast. Although we do not have significant direct exposure to volatility of crude oil prices, changes in crude oil pricing that affect long term refining planned output could impact Jefferson Terminal operations. We expect the Jefferson Terminal reporting unit to continue to generate positive Adjusted EBITDA in future years. Further delays in executing anticipated contracts or achieving our projected volumes could adversely affect the fair value of the reporting unit. There was no impairment of goodwill for the year ended December 31, 2024. Recent Accounting Pronouncements The Company has reviewed recently issued accounting pronouncements and concluded that such pronouncements are either not applicable to the Company or no material impact is expected in the consolidated financial statements as a result of future adoption.