NGL-PC Q3 2026 Earnings Call Summary

NGL Energy Partners Q3 2026 Earnings Call Summary

1. Key Financial Results and Metrics

Adjusted EBITDA: $172.5 million, up 9.2% from $158 million in Q3 2025.
Water Solutions Segment EBITDA: $154.5 million, a 16.5% increase from $132.7 million year-over-year.
Physical Water Disposal Volumes: Reached a record 3.07 million barrels per day, up 17.1% from 2.6 million barrels per day in Q3 2025.
Operating Expenses: Reduced to $0.18 per barrel due to nonrecurring expense reductions.
Crude Oil Logistics EBITDA: Declined to $15.4 million from $17.3 million in the prior year.
Liquids Logistics EBITDA: Decreased to $15.2 million from $18.6 million year-over-year.

2. Strategic Updates and Business Highlights

Continued focus on water solutions, with a significant shift away from non-water assets.
Redeemed 15% of Class D preferred equity and repurchased 1.6 million common units, totaling approximately 8.7 million units repurchased since inception.
Successful execution of growth projects in the Delaware Basin, including the Western Express pipeline expansion.
Advanced AI and machine learning initiatives aimed at improving operational efficiencies and reducing costs.
Entered into a Memorandum of Understanding (MOU) with Natura Resources for a nuclear-powered desalination project, aimed at large-scale produced water treatment.

3. Forward Guidance and Outlook

Full-year EBITDA guidance maintained at $650 to $660 million for fiscal 2026.
Anticipation of exceeding $700 million in EBITDA for the first time in fiscal 2027.
Strong contracted volumes expected to contribute positively to growth in the upcoming fiscal year.

4. Bad News, Challenges, or Points of Concern

Decline in EBITDA from Crude Oil and Liquids Logistics segments due to lower oil prices and reduced volumes from committed producers.
Potential impact of extreme weather on disposal volumes, though not expected to materially affect full-year guidance.
Market concerns regarding near-term capital obligations related to the Natura project, which may not yield immediate financial benefits.

5. Notable Q&A Insights

Management expressed confidence in the stability of growth projects despite crude price volatility, citing long-term volume commitments from customers.
Discussions on the potential impact of consolidation in the industry, with no immediate conversations with Devon following recent deals.
AI initiatives are expected to enhance operational efficiencies, but quantifiable financial benefits from these projects are still being assessed.

Overall, NGL Energy Partners demonstrated strong operational performance in Q3 2026, particularly in its Water Solutions segment, while also navigating challenges in other areas. The company remains focused on strategic growth and efficiency improvements, with a positive outlook for the upcoming fiscal year.

NGL-PC — NGL Energy Partners LP