South Bow Corp

South Bow seeks to optimize its assets, invest strategically to sustainably grow its cash flows, and pay a meaningful dividend, if, as, and when declared by South Bow's board of directors (the Board ).

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

South Bow's capital allocation priorities include paying a sustainable base dividend strengthening the Company's investment-grade financial position and leveraging existing infrastructure within South Bow's strategic corridor to offer customers competitive connections, enhanced optionality, and value chain extensions.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

Capital expenditures per the investing activities of the consolidated cash flow statements in the accompanying financial statements.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

Total long-term debt includes the Company's senior unsecured notes ( Senior Notes ) and junior subordinated notes ( Junior Notes ) per the consolidated balance sheets of the accompanying financial statements.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

Refer to the Long-term Debt, including Credit Facilities section of this MD A for additional details.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

Total Long-term Debt and Net Debt 1.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

South Bow seeks to optimize its assets, invest strategically to sustainably grow its cash flows, and pay a meaningful dividend, if, as, and when declared by South Bow's board of directors (the Board ).

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

The Company's capital allocation priorities are built on a foundation of financial strength and are supported by South Bow's stable, predictable cash flows.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

South Bow's capital allocation priorities include paying a sustainable base dividend strengthening the Company's investment-grade financial position and leveraging existing infrastructure within South Bow's strategic corridor to offer customers competitive connections, enhanced optionality, and value chain extensions.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

South Bow Corporation First Quarter 2026 Management s Discussion and Analysis 11 Maintaining a strong balance sheet and financial flexibility is fundamental to South Bow's strategy.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

The Company is committed to prudently managing leverage and expects to enhance its financial resilience, reduce debt service charges, and create additional capacity to fund future growth initiatives and potentially grow shareholder returns.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

These specific normalizing items include gains or losses on sales of assets or assets held for sale, unrealized fair value adjustments related to risk management activities, tariff charges, separation, acquisition, integration, and restructuring costs, and other charges, including but not limited to, impairment, contractual costs, costs associated with preliminary business development activities (referred to as Business Development projects ), and settlements.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

South Bow excludes tariff charges as they are not reflective of ongoing business conducted by the Company and are subject to uncertainty.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

Normalized EBITDA represents income (loss) before income taxes adjusted for the normalizing items including gains or losses on sales of assets or assets held for sale, unrealized fair value adjustments related to risk management activities, tariff charges, separation, acquisition, integration, and restructuring costs, and other charges, including but not limited to, impairment, contractual costs, costs associated with preliminary business development activities, and settlements, in addition to excluding charges for depreciation and amortization, interest expense, interest income and other, and other income.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

South Bow does not provide a reconciliation of such forward-looking measure to the most directly comparable financial measure calculated and presented in accordance with GAAP due to unknown variables and the uncertainty related to future results.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

Tariff charges incurred on the Company's Marketing activities recorded within plant operating costs and other in the consolidated statements of income.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026

$ millions Keystone Pipeline System Marketing Intra-Alberta Other Total Income (loss) before income taxes 197 (22) (75) 100 Adjusted for specific items Depreciation and amortization 60 4 64 Interest expense 84 84 Interest income and other (6) (1) (4) (11) Risk management instruments 32 32 Keystone variable toll disputes (18) (18) Separation costs 1 1 Business Development projects 5 5 Tariff charges Keystone XL costs and other Segment Normalized EBITDA 233 9 15 257 Three Months Ended March 31, 2025 U.

SEC original ↗South Bow Corp — Earnings release (6-K exhibit)EX-99May 7, 2026