NGL Energy Partners (NGL) Q1 2026 earnings summary

Executive summary

• Net income rose to $69.6 million for the quarter ended June 30, 2025, up from $10.5 million year-over-year, driven by gains from asset sales and discontinued operations.

• Adjusted EBITDA from continuing operations increased to $144.97 million, up from $138.6 million year-over-year, with Water Solutions contributing 92% of Q1 FY2026 Adjusted EBITDA.

• Strategic shift included the sale of rack marketing, Limestone Ranch, refined products, and most of the wholesale propane business, with proceeds used to pay down ABL and other debt.

• Repurchased $19 million of 2032 notes, 70,000 Class D preferred units, and 4.7 million common units at $4.30/unit, strengthening the balance sheet.

• LEX II water pipeline project commenced operations, expanding capacity and contributing to higher water pipeline revenue.

Financial highlights

• Q1 FY2026 Adjusted EBITDA: $144.97 million, up from $144.34 million in Q1 FY2025 and $134.66 million in Q1 FY2024.

• Net income attributable to the partnership was $68.9 million, up from $9.7 million in the prior year period.

• Total revenues from continuing operations were $622.2 million, down from $759.2 million year-over-year, reflecting divestitures and lower commodity prices.

• Water Solutions Adjusted EBITDA grew to $142.87 million, up 13.8% year-over-year, driven by higher disposal volumes and pipeline revenue.

• Crude Oil Logistics Adjusted EBITDA was $9.58 million, down from $18.64 million year-over-year due to lower volumes and prices.

Outlook and guidance

• Reaffirmed full-year adjusted EBITDA guidance of $615 million–$625 million, with management to reevaluate after Q2 if current trends continue.

• Water Solutions segment expected to continue outperforming, supported by long-term contracts and minimum volume commitments.

• Capital expenditures for fiscal year ending March 31, 2026 are expected to be approximately $105 million.

• Board will evaluate reinstatement of common unit distributions, considering leverage, liquidity, and business performance.

• Focus remains on capital efficiency and leveraging existing infrastructure for future volume growth.