NGL Energy Partners (NGL) Q3 2026 earnings summary

Executive summary

• Achieved record water disposal volumes and strong financial performance, with Q3 FY2026 Adjusted EBITDA rising to $172.6 million, up 9.2% year-over-year, driven by Water Solutions' 16% growth and segment dominance.

• Strategic shift toward a water solutions-focused business, supported by long-term contracts, asset sales, debt refinancing, and unit repurchases.

• Net income and operating income rose sharply year-over-year, with net income for the nine months ended December 31, 2025, at $147.7 million, up from $28.4 million, driven by Water Solutions and asset sales.

• Largest integrated water disposal system in the Delaware Basin, with 84% of Q3 FY2026 segment EBITDA from Water Solutions.

• Significant progress on growth projects, including the LEX II pipeline and new contracted volumes, supporting a strong outlook for fiscal 2027.

Financial highlights

• Q3 FY2026 Adjusted EBITDA reached $172.6 million, up from $158 million a year ago; Water Solutions Adjusted EBITDA was $154.5 million, up 16.5% year-over-year.

• Record water disposal volumes of 3.07 million barrels per day, up 17.1% year-over-year.

• Total revenues for the nine months ended December 31, 2025, were $2.21 billion, down from $2.50 billion year-over-year due to divestitures.

• Net income attributable to the partnership was $145.4 million for the nine months, compared to $25.6 million in the prior year.

• Distributable cash flow for Q3 FY2026 was $73.9 million, up from $40.0 million in Q3 FY2025.

Outlook and guidance

• Full-year fiscal 2026 Adjusted EBITDA guidance maintained at $650–$660 million, with fiscal 2027 expected to exceed $700 million.

• Predictable cash flows expected due to long-term fixed fee contracts, acreage dedications, and minimum volume commitments.

• Capital expenditures for fiscal year ending March 31, 2026, are expected to be $220–$230 million.

• The board will evaluate reinstatement of common unit distributions based on leverage, liquidity, and business performance.