NGL Energy Partners LP (NYSE:NGL) (“NGL,” “we,” “us,” “our,” or the “Partnership”) today reported its second quarter Fiscal 2027 financial results. Highlights include:
Financial Results:
- Loss from continuing operations for the second quarter of Fiscal 2027 of $42.6 million, which includes an impairment charge of $58.1 million, compared to income from continuing operations of $29.8 million for the second quarter of Fiscal 2026
- Adjusted EBITDA from continuing operations(1) for the second quarter of Fiscal 2027 of $192.4 million, compared to $167.3 million for the second quarter of Fiscal 2026, a 15% increase
Water Solutions:
- On May 7, 2026, we announced the LEX II Extension, which expands the current long haul LEX Pipeline System to 81 miles with a capability to transport approximately 560,000 barrels per day of produced water from Eddy and Lea Counties, NM to Andrews County, TX. The LEX II Extension is underwritten by a newly executed long-term volume commitment contract that includes increased volume commitments, and an additional four township committed area in Eddy County, NM. The LEX II Extension is expected to be in service by the end of the calendar year.
- Record produced water volumes physically disposed of approximately 3.45 million barrels per day during the second quarter of Fiscal 2027, growing 22.9% from the second quarter of Fiscal 2026
- Paid and physically disposed water volumes of 3.49 million barrels per day during the second quarter of Fiscal 2027, growing 10.9% from the second quarter of Fiscal 2026
- Permitted injection capacity was increased by approximately 255,000 barrels during the second quarter of Fiscal 2027
Debt Transactions
- On September 16, 2026, re-priced the Term Loan B to reduce the applicable margins by 50 basis points
- On October 13, 2026, exercised $50 million of the accordion feature of our ABL facility, raising commitments to $475 million
Guidance:
- Raised our full year Fiscal 2027 Adjusted EBITDA(2) guidance to $735-$745 million
| ________________ |
|
(1) See the “Non-GAAP Financial Measures” section of this release for the definition of Adjusted EBITDA (as used herein) and a discussion of this non-GAAP financial measure. |
|
(2) Certain of the forward-looking financial measures are provided on a non-GAAP basis. A reconciliation of forward-looking financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP is potentially misleading and not practical given the difficulty of projecting event driven transactional and other non-core operating items in any future period. The magnitude of these items, however, may be significant. |
“NGL had another strong quarter driven by our Water Solutions segment. We continue to see growth opportunities in the Water Solutions segment that will set the Partnership up for a strong exit of this fiscal year. We are raising our full year guidance for a second time from Adjusted EBITDA(2) of $725-$735 million to $735-$745 million,” stated Mike Krimbill, NGL’s CEO.
Quarterly Results of Operations
The following table summarizes the unaudited operating income (loss) and Adjusted EBITDA from continuing operations(1) by reportable segment for the periods indicated:
|
|
|
Quarter Ended |
||||||||||||||
|
|
|
September 30, 2026 |
|
September 30, 2025 |
||||||||||||
|
|
|
Operating Income (Loss) |
|
Adjusted EBITDA(1) |
|
Operating Income (Loss) |
|
Adjusted EBITDA(1) |
||||||||
|
|
|
(in thousands) |
||||||||||||||
|
Water Solutions |
|
$ |
94,683 |
|
|
$ |
178,269 |
|
|
$ |
92,354 |
|
|
$ |
151,902 |
|
|
Crude Oil Logistics |
|
|
(56,603 |
) |
|
|
11,862 |
|
|
|
8,224 |
|
|
|
16,553 |
|
|
Liquids Logistics |
|
|
3,485 |
|
|
|
14,211 |
|
|
|
6,346 |
|
|
|
10,521 |
|
|
Corporate and Other |
|
|
(17,640 |
) |
|
|
(11,984 |
) |
|
|
(12,673 |
) |
|
|
(11,643 |
) |
|
Total |
|
$ |
23,925 |
|
|
$ |
192,358 |
|
|
$ |
94,251 |
|
|
$ |
167,333 |
|
Water Solutions
Operating income for the Water Solutions segment increased by $2.3 million for the quarter ended September 30, 2026, compared to the quarter ended September 30, 2025. The increase was due primarily to higher disposal revenues due to an increase in produced water volumes processed from contracted customers and increased water pipeline revenue primarily from a new contract that began in February 2026. The Partnership processed approximately 3.45 million barrels of produced water per day during the quarter ended September 30, 2026, a 22.9% increase when compared to approximately 2.80 million barrels of water per day processed during the quarter ended September 30, 2025.
Revenues from recovered skim oil, including the impact from realized skim oil hedges, totaled $38.6 million for the quarter ended September 30, 2026, an increase of $10.6 million from the prior year period. The increase was due primarily to higher realized crude oil prices received from the sale of skim oil barrels and an increase in skim oil barrels sold due to more skim oil recovered from receiving more produced water.
Operating expenses in the Water Solutions segment increased $9.3 million for the quarter ended September 30, 2026, compared to the quarter ended September 30, 2025 due primarily to higher royalty expense from increased volumes related to certain saltwater disposal wells, higher utilities expense due to increased produced water volumes processed and newly constructed assets placed in-service in advance of permanent grid power infrastructure availability and higher severance taxes due to the increase in revenue from recovered crude oil. Operating expense per produced barrel processed was $0.20 for the quarter ended September 30, 2026, compared to $0.22 in the comparative quarter last year.
There was also an increase in net unrealized losses on skim oil hedges of $23.4 million, compared to the prior year period, due to the volatility in crude oil prices caused by the U.S./Iran conflict.
Crude Oil Logistics
Operating income for the Crude Oil Logistics segment decreased by $64.8 million for the quarter ended September 30, 2026, compared to the quarter ended September 30, 2025. This decrease was due primarily to an impairment of long-lived assets. In addition, lower product margins due to expiration of a commercial contract, increased losses on derivatives and severance expense related to the reorganization of the segment contributed to the decrease. During the quarter ended September 30, 2026, physical volumes on the Grand Mesa Pipeline averaged approximately 64,000 barrels per day, compared to approximately 72,000 barrels per day for the quarter ended September 30, 2025.
Liquids Logistics
Operating income for the Liquids Logistics segment decreased by $2.9 million for the quarter ended September 30, 2026, compared to the quarter ended September 30, 2025. This decrease was primarily related to increased derivative losses during the current period. This decrease was partially offset by increased product margins, excluding derivatives, primarily from the sale of butane and increased service revenue from a new throughput contract at one of our terminals.
Capitalization and Liquidity
Total liquidity (cash plus available capacity on our asset-based revolving credit facility (“ABL Facility”)) was approximately $129.7 million as of September 30, 2026. Borrowings on the Partnership’s ABL Facility totaled approximately $249.0 million as of September 30, 2026, due primarily to an increase in capital spending within our Water Solutions segment.
The Partnership is in compliance with all of its debt covenants and has no upcoming debt maturities.
Second Quarter Conference Call Information
A conference call to discuss NGL’s results of operations is scheduled for 4:00 pm Central Time on Thursday, November 5, 2026. Analysts, investors, and other interested parties may join the webcast via the event link: https://www.webcaster5.com/Webcast/Page/2808/54630 or by dialing (877) 545-0523 and providing conference code: 933561. An archived audio replay of the call will be available for 14 days, which can be accessed by dialing (877) 481-4010 and providing replay passcode 54630.
Non-GAAP Financial Measures
We define EBITDA as net income (loss) attributable to NGL Energy Partners LP, plus interest expense, income tax expense (benefit), and depreciation and amortization expense. We define Adjusted EBITDA as EBITDA excluding net unrealized gains and losses on derivatives, lower of cost or net realizable value adjustments, gains and losses on disposal or impairment of assets, gains and losses on early extinguishment of liabilities, equity-based compensation expense, revaluation of liabilities and other. Also excluded are temporary power costs, which are the incremental costs of power generation for newly constructed assets placed in-service in advance of permanent grid power infrastructure availability. In addition, severance costs are excluded as they are not considered part of the normal operations and excluding these costs enhances comparability across periods and provides a better assessment of underlying operating performance. EBITDA and Adjusted EBITDA should not be considered as alternatives to net (loss) income, (loss) income from continuing operations before income taxes, cash flows from operating activities, or any other measure of financial performance calculated in accordance with GAAP, as those items are used to measure operating performance, liquidity or the ability to service debt obligations. We believe that EBITDA provides additional information to investors for evaluating our ability to make quarterly distributions to our unitholders and is presented solely as a supplemental measure. We believe that Adjusted EBITDA provides additional information to investors for evaluating our financial performance without regard to our financing methods, capital structure and historical cost basis. Further, EBITDA and Adjusted EBITDA, as we define them, may not be comparable to EBITDA, Adjusted EBITDA, or similarly titled measures used by other entities.
For purposes of our Adjusted EBITDA calculation, we make a distinction between realized and unrealized gains and losses on derivatives. During the period when a derivative contract is open, we record changes in the fair value of the derivative as an unrealized gain or loss. When a derivative contract matures or is settled, we reverse the previously recorded unrealized gain or loss and record a realized gain or loss.
Distributable Cash Flow is defined as Adjusted EBITDA minus maintenance capital expenditures, income tax expense, cash interest expense, preferred unit distributions paid and other. Maintenance capital expenditures represent capital expenditures necessary to maintain the Partnership’s operating capacity. Distributable Cash Flow is a performance metric used by senior management to compare cash flows generated by the Partnership (excluding growth capital expenditures and prior to the establishment of any retained cash reserves by the board of directors of our general partner) to the cash distributions expected to be paid to unitholders. Using this metric, management can quickly compute the coverage ratio of estimated cash flows to planned cash distributions. This financial measure also is important to investors as an indicator of whether the Partnership is generating cash flow at a level that can sustain, or support an increase in, quarterly distribution rates. Actual distribution amounts are set by the board of directors of our general partner.
We do not provide a reconciliation for non-GAAP estimates on a forward-looking basis where we are unable to provide a meaningful calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing or amount of various items that would impact the most directly comparable forward-looking U.S. GAAP financial measure that have not yet occurred, are out of the Partnership’s control and/or cannot be reasonably predicted. Forward-looking non-GAAP financial measures provided without the most directly comparable U.S. GAAP financial measures may vary materially from the corresponding U.S. GAAP financial measures.
Forward-Looking Statements
This press release includes “forward-looking statements.” All statements other than statements of historical facts included or incorporated herein may constitute forward-looking statements. Actual results could vary significantly from those expressed or implied in such statements and are subject to a number of risks and uncertainties. While NGL believes such forward-looking statements are reasonable, NGL cannot assure they will prove to be correct. The forward-looking statements involve risks and uncertainties that affect operations, financial performance, and other factors as discussed in filings with the Securities and Exchange Commission. Other factors that could impact any forward-looking statements are those risks described in NGL’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and other public filings. You are urged to carefully review and consider the cautionary statements and other disclosures made in those filings, specifically those under the heading “Risk Factors.” NGL undertakes no obligation to publicly update or revise any forward-looking statements except as required by law.
NGL provides Adjusted EBITDA guidance that does not include certain charges and costs, which in future periods are generally expected to be similar to the kinds of charges and costs excluded from Adjusted EBITDA in prior periods, such as income taxes, interest and other non-operating items, depreciation and amortization, net unrealized gains and losses on derivatives, lower of cost or net realizable value adjustments, gains and losses on disposal or impairment of assets, gains and losses on early extinguishment of liabilities, equity-based compensation expense, acquisition expense, revaluation of liabilities and items that are unusual in nature or infrequently occurring. The exclusion of these charges and costs in future periods will have a significant impact on the Partnership’s Adjusted EBITDA, and the Partnership is not able to provide a reconciliation of its Adjusted EBITDA guidance to net income (loss) without unreasonable efforts due to the uncertainty and variability of the nature and amount of these future charges and costs and the Partnership believes that such reconciliation, if possible, would imply a degree of precision that would be potentially confusing or misleading to investors.
About NGL Energy Partners LP
NGL Energy Partners LP, a Delaware master limited partnership, operates the largest integrated produced water pipeline, disposal, and water handling network in the Delaware Basin, supported by long-term, fee-based producer contracts and continues to enhance its ability to transport produced water from the wellhead to treatment for disposal, recycle, or discharge through our expanding pipeline infrastructure and ongoing disposal capacity investments. While maintaining complementary crude oil and natural gas liquids logistics operations, capital allocation and strategic focus are centered on providing water solutions services, which will reduce earnings volatility and enhance cash flow stability. For further information, visit the Partnership’s website at www.nglenergypartners.com.
|
NGL ENERGY PARTNERS LP AND SUBSIDIARIES |
|||||||
|
Unaudited Condensed Consolidated Balance Sheets |
|||||||
|
(in Thousands, except unit amounts) |
|||||||
|
|
September 30, 2026 |
|
March 31, 2026 |
||||
|
ASSETS |
|
|
|
||||
|
CURRENT ASSETS: |
|
|
|
||||
|
Cash and cash equivalents |
$ |
7,562 |
|
|
$ |
8,505 |
|
|
Accounts receivable, net of allowance for expected credit losses of $1,652 and $1,738, respectively |
|
710,128 |
|
|
|
661,157 |
|
|
Accounts receivable-affiliates |
|
450 |
|
|
|
313 |
|
|
Inventories |
|
98,877 |
|
|
|
67,351 |
|
|
Prepaid expenses and other current assets |
|
36,990 |
|
|
|
36,624 |
|
|
Total current assets |
|
854,007 |
|
|
|
773,950 |
|
|
PROPERTY, PLANT AND EQUIPMENT, net of accumulated depreciation of $1,364,944 and $1,272,286, respectively |
|
2,181,528 |
|
|
|
2,091,747 |
|
|
GOODWILL |
|
351,506 |
|
|
|
351,506 |
|
|
INTANGIBLE ASSETS, net of accumulated amortization of $421,616 and $389,992, respectively |
|
773,401 |
|
|
|
805,110 |
|
|
OPERATING LEASE RIGHT-OF-USE ASSETS |
|
105,667 |
|
|
|
113,326 |
|
|
OTHER NONCURRENT ASSETS |
|
29,703 |
|
|
|
39,900 |
|
|
Total assets |
$ |
4,295,812 |
|
|
$ |
4,175,539 |
|
|
LIABILITIES AND DEFICIT |
|
|
|
||||
|
CURRENT LIABILITIES: |
|
|
|
||||
|
Accounts payable |
$ |
521,480 |
|
|
$ |
495,180 |
|
|
Accounts payable-affiliates |
|
1 |
|
|
|
1 |
|
|
Accrued expenses and other payables |
|
163,303 |
|
|
|
184,184 |
|
|
Advance payments received from customers |
|
21,442 |
|
|
|
15,201 |
|
|
Current maturities of long-term debt |
|
11,538 |
|
|
|
11,457 |
|
|
Operating lease obligations |
|
36,482 |
|
|
|
33,459 |
|
|
Total current liabilities |
|
754,246 |
|
|
|
739,482 |
|
|
LONG-TERM DEBT, net of debt issuance costs of $38,353 and $41,264, respectively, and current maturities |
|
3,334,250 |
|
|
|
3,223,126 |
|
|
OPERATING LEASE OBLIGATIONS |
|
72,211 |
|
|
|
82,160 |
|
|
OTHER NONCURRENT LIABILITIES |
|
141,836 |
|
|
|
136,953 |
|
|
|
|
|
|
||||
|
CLASS D PREFERRED UNITS, 315,489 and 315,489 preferred units issued and outstanding, respectively |
|
289,824 |
|
|
|
289,824 |
|
|
REDEEMABLE NONCONTROLLING INTERESTS |
|
617 |
|
|
|
559 |
|
|
|
|
|
|
||||
|
DEFICIT: |
|
|
|
||||
|
General partner, representing a 0.1% interest, 124,939 and 123,938 notional units, respectively |
|
(53,322 |
) |
|
|
(53,319 |
) |
|
Limited partners, representing a 99.9% interest, 124,814,289 and 123,814,289 common units issued and outstanding, respectively |
|
(612,570 |
) |
|
|
(612,276 |
) |
|
Class B preferred limited partners, 12,585,642 and 12,585,642 preferred units issued and outstanding, respectively |
|
305,468 |
|
|
|
305,468 |
|
|
Class C preferred limited partners, 1,800,000 and 1,800,000 preferred units issued and outstanding, respectively |
|
42,891 |
|
|
|
42,891 |
|
|
Noncontrolling interests |
|
20,361 |
|
|
|
20,671 |
|
|
Total deficit |
|
(297,172 |
) |
|
|
(296,565 |
) |
|
Total liabilities and deficit |
$ |
4,295,812 |
|
|
$ |
4,175,539 |
|
|
NGL ENERGY PARTNERS LP AND SUBSIDIARIES |
||||||||||||||||
|
Unaudited Condensed Consolidated Statements of Operations |
||||||||||||||||
|
(in Thousands, except unit and per unit amounts) |
||||||||||||||||
|
|
|
Three Months Ended September 30, |
|
Six Months Ended September 30, |
||||||||||||
|
|
|
|
2026 |
|
|
|
2025 |
|
|
|
2026 |
|
|
|
2025 |
|
|
REVENUES: |
|
|
|
|
|
|
|
|
||||||||
|
Product |
|
$ |
765,505 |
|
|
$ |
484,255 |
|
|
$ |
1,539,805 |
|
|
$ |
920,673 |
|
|
Service and other |
|
|
221,048 |
|
|
|
190,422 |
|
|
|
436,740 |
|
|
|
376,160 |
|
|
Total Revenues |
|
|
986,553 |
|
|
|
674,677 |
|
|
|
1,976,545 |
|
|
|
1,296,833 |
|
|
COST OF SALES: |
|
|
|
|
|
|
|
|
||||||||
|
Product |
|
|
723,373 |
|
|
|
415,554 |
|
|
|
1,402,845 |
|
|
|
793,018 |
|
|
Service and other |
|
|
4,597 |
|
|
|
5,466 |
|
|
|
9,534 |
|
|
|
10,814 |
|
|
Total Cost of Sales |
|
|
727,970 |
|
|
|
421,020 |
|
|
|
1,412,379 |
|
|
|
803,832 |
|
|
OPERATING COSTS AND EXPENSES: |
|
|
|
|
|
|
|
|
||||||||
|
Operating |
|
|
87,619 |
|
|
|
74,089 |
|
|
|
166,504 |
|
|
|
144,857 |
|
|
General and administrative |
|
|
19,526 |
|
|
|
14,729 |
|
|
|
37,094 |
|
|
|
28,469 |
|
|
Depreciation and amortization |
|
|
63,146 |
|
|
|
63,994 |
|
|
|
125,041 |
|
|
|
130,579 |
|
|
Loss (gain) on disposal or impairment of assets, net |
|
|
64,367 |
|
|
|
6,594 |
|
|
|
66,283 |
|
|
|
(2,605 |
) |
|
Operating Income |
|
|
23,925 |
|
|
|
94,251 |
|
|
|
169,244 |
|
|
|
191,701 |
|
|
OTHER INCOME (EXPENSE): |
|
|
|
|
|
|
|
|
||||||||
|
Equity in earnings of unconsolidated entities |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
201 |
|
|
Interest expense |
|
|
(66,846 |
) |
|
|
(64,708 |
) |
|
|
(133,914 |
) |
|
|
(130,253 |
) |
|
Gain on early extinguishment of liabilities, net |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,492 |
|
|
Other income (expense), net |
|
|
492 |
|
|
|
208 |
|
|
|
1,988 |
|
|
|
(3,307 |
) |
|
(Loss) Income From Continuing Operations Before Income Taxes |
|
|
(42,429 |
) |
|
|
29,751 |
|
|
|
37,318 |
|
|
|
59,834 |
|
|
INCOME TAX (EXPENSE) BENEFIT |
|
|
(187 |
) |
|
|
61 |
|
|
|
112 |
|
|
|
243 |
|
|
(Loss) Income From Continuing Operations |
|
|
(42,616 |
) |
|
|
29,812 |
|
|
|
37,430 |
|
|
|
60,077 |
|
|
Income From Discontinued Operations, net of Tax |
|
|
35 |
|
|
|
9 |
|
|
|
70 |
|
|
|
39,388 |
|
|
Net (Loss) Income |
|
|
(42,581 |
) |
|
|
29,821 |
|
|
|
37,500 |
|
|
|
99,465 |
|
|
LESS: NET INCOME FROM CONTINUING OPERATIONS ATTRIBUTABLE TO NONREDEEMABLE NONCONTROLLING INTERESTS |
|
|
(1,705 |
) |
|
|
(490 |
) |
|
|
(3,082 |
) |
|
|
(1,195 |
) |
|
LESS: NET LOSS (INCOME) FROM CONTINUING OPERATIONS ATTRIBUTABLE TO REDEEMABLE NONCONTROLLING INTERESTS |
|
|
35 |
|
|
|
(47 |
) |
|
|
63 |
|
|
|
(64 |
) |
|
NET (LOSS) INCOME ATTRIBUTABLE TO NGL ENERGY PARTNERS LP |
|
$ |
(44,251 |
) |
|
$ |
29,284 |
|
|
$ |
34,481 |
|
|
$ |
98,206 |
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
NET (LOSS) INCOME FROM CONTINUING OPERATIONS ALLOCATED TO COMMON UNITHOLDERS |
|
$ |
(63,101 |
) |
|
$ |
3,137 |
|
|
$ |
(3,270 |
) |
|
$ |
(30,887 |
) |
|
NET INCOME FROM DISCONTINUED OPERATIONS ALLOCATED TO COMMON UNITHOLDERS |
|
|
35 |
|
|
|
9 |
|
|
|
70 |
|
|
|
39,349 |
|
|
NET (LOSS) INCOME ALLOCATED TO COMMON UNITHOLDERS |
|
$ |
(63,066 |
) |
|
$ |
3,146 |
|
|
$ |
(3,200 |
) |
|
$ |
8,462 |
|
|
BASIC AND DILUTED (LOSS) INCOME PER COMMON UNIT |
|
|
|
|
|
|
|
|
||||||||
|
(Loss) Income From Continuing Operations |
|
$ |
(0.51 |
) |
|
$ |
0.02 |
|
|
$ |
(0.03 |
) |
|
$ |
(0.24 |
) |
|
Income From Discontinued Operations, net of Tax |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
0.30 |
|
|
Net (Loss) Income |
|
$ |
(0.51 |
) |
|
$ |
0.02 |
|
|
$ |
(0.03 |
) |
|
$ |
0.07 |
|
|
BASIC WEIGHTED AVERAGE COMMON UNITS OUTSTANDING |
|
|
124,814,289 |
|
|
|
127,309,332 |
|
|
|
124,808,825 |
|
|
|
129,516,312 |
|
|
DILUTED WEIGHTED AVERAGE COMMON UNITS OUTSTANDING |
|
|
124,814,289 |
|
|
|
127,309,332 |
|
|
|
124,808,825 |
|
|
|
129,516,312 |
|
|
EBITDA, ADJUSTED EBITDA AND DISTRIBUTABLE CASH FLOW RECONCILIATION |
||||||||||||||||
|
(Unaudited) |
||||||||||||||||
|
The following table reconciles NGL’s net (loss) income to NGL’s EBITDA, Adjusted EBITDA and Distributable Cash Flow for the periods indicated: |
||||||||||||||||
|
|
|
Three Months Ended September 30, |
|
Six Months Ended September 30, |
||||||||||||
|
|
|
|
2026 |
|
|
|
2025 |
|
|
|
2026 |
|
|
|
2025 |
|
|
|
|
(in thousands) |
||||||||||||||
|
Net (loss) income |
|
$ |
(42,581 |
) |
|
$ |
29,821 |
|
|
$ |
37,500 |
|
|
$ |
99,465 |
|
|
Less: Net income from continuing operations attributable to nonredeemable noncontrolling interests |
|
|
(1,705 |
) |
|
|
(490 |
) |
|
|
(3,082 |
) |
|
|
(1,195 |
) |
|
Less: Net loss (income) from continuing operations attributable to redeemable noncontrolling interests |
|
|
35 |
|
|
|
(47 |
) |
|
|
63 |
|
|
|
(64 |
) |
|
Net (loss) income attributable to NGL Energy Partners LP |
|
|
(44,251 |
) |
|
|
29,284 |
|
|
|
34,481 |
|
|
|
98,206 |
|
|
Interest expense |
|
|
66,826 |
|
|
|
64,687 |
|
|
|
133,875 |
|
|
|
130,212 |
|
|
Income tax expense (benefit) |
|
|
187 |
|
|
|
(45 |
) |
|
|
(112 |
) |
|
|
(227 |
) |
|
Depreciation and amortization |
|
|
64,192 |
|
|
|
63,222 |
|
|
|
127,117 |
|
|
|
129,048 |
|
|
EBITDA |
|
|
86,954 |
|
|
|
157,148 |
|
|
|
295,361 |
|
|
|
357,239 |
|
|
Net unrealized losses (gains) on derivatives |
|
|
35,636 |
|
|
|
(317 |
) |
|
|
(3,724 |
) |
|
|
(7,857 |
) |
|
Lower of cost or net realizable value adjustments (1) |
|
|
(5,829 |
) |
|
|
2,519 |
|
|
|
459 |
|
|
|
(425 |
) |
|
Loss (gain) on disposal or impairment of assets, net (2) |
|
|
64,361 |
|
|
|
6,595 |
|
|
|
66,268 |
|
|
|
(40,984 |
) |
|
Gain on early extinguishment of liabilities, net |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,492 |
) |
|
Equity-based compensation expense |
|
|
4,177 |
|
|
|
— |
|
|
|
6,168 |
|
|
|
— |
|
|
Other (3) |
|
|
7,094 |
|
|
|
1,436 |
|
|
|
14,114 |
|
|
|
5,867 |
|
|
Adjusted EBITDA |
|
$ |
192,393 |
|
|
$ |
167,381 |
|
|
$ |
378,646 |
|
|
$ |
312,348 |
|
|
Adjusted EBITDA – Discontinued Operations (4) |
|
$ |
35 |
|
|
$ |
48 |
|
|
$ |
70 |
|
|
$ |
1,043 |
|
|
Adjusted EBITDA – Continuing Operations |
|
$ |
192,358 |
|
|
$ |
167,333 |
|
|
$ |
378,576 |
|
|
$ |
311,305 |
|
|
Less: Cash interest expense (5) |
|
|
65,496 |
|
|
|
61,876 |
|
|
|
130,913 |
|
|
|
123,667 |
|
|
Less: Income tax expense (benefit) |
|
|
187 |
|
|
|
(61 |
) |
|
|
(112 |
) |
|
|
(243 |
) |
|
Less: Maintenance capital expenditures |
|
|
17,767 |
|
|
|
11,523 |
|
|
|
33,218 |
|
|
|
22,622 |
|
|
Less: Preferred unit distributions paid |
|
|
18,806 |
|
|
|
26,153 |
|
|
|
37,559 |
|
|
|
57,689 |
|
|
Less: Other (6) |
|
|
11,581 |
|
|
|
3,336 |
|
|
|
4,953 |
|
|
|
4,628 |
|
|
Distributable Cash Flow |
|
$ |
78,521 |
|
|
$ |
64,506 |
|
|
$ |
172,045 |
|
|
$ |
102,942 |
|
| ________________ | |
|
(1) |
Lower of cost or net realizable value adjustments in the table above differ from lower of cost or net realizable value adjustments reported in our unaudited condensed consolidated statements of cash flows in the Partnership’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2026, as the amounts reported in the table above represent the change in lower of cost or net realizable value adjustments recorded in our unaudited condensed consolidated statements of operations, which includes reversals, whereas the amounts reported in our unaudited condensed consolidated statements of cash flows represent the lower of cost or net realizable value adjustments recorded at the balance sheet date. |
|
(2) |
Excludes amounts related to unconsolidated entities and noncontrolling interests. |
|
(3) |
Amounts represent accretion expense for asset retirement obligations, expenses incurred related to legal and advisory costs associated with acquisitions and dispositions, unrealized gains and losses on investments and marketable securities and a loss from a legal dispute. For the three months and six months ended September 30, 2026, the amounts include temporary power costs and severance costs. In addition, the amount for the six months ended September 30, 2026 includes approximately $2.6 million of realized losses from derivatives associated with crude oil barrels reclassified as linefill as of March 31, 2026. |
|
(4) |
Amounts include our refined products and biodiesel businesses. |
|
(5) |
Amounts represent interest expense payable in cash, excluding changes in the accrued interest balance. |
|
(6) |
Amounts represent cash paid to settle asset retirement obligations, temporary power costs, and severance costs. For the three months ended September 30, 2026, amount excludes $5.8 million of gains included in Adjusted EBITDA from derivative contracts settled in the preceding quarter, while the amount for the six months ended September 30, 2026 excludes $4.0 million of losses from similarly treated derivative contracts. For the six months ended September 30, 2026, amount also includes realized losses for derivative contracts described in Note 3 above. |
|
ADJUSTED EBITDA RECONCILIATION BY SEGMENT |
||||||||||||||||||||||||||
|
(unaudited) |
||||||||||||||||||||||||||
|
|
Three Months Ended September 30, 2026 |
|||||||||||||||||||||||||
|
|
Water Solutions |
|
Crude Oil Logistics |
|
Liquids Logistics |
|
Corporate and Other |
|
Continuing Operations |
|
Discontinued Operations |
|
Consolidated |
|||||||||||||
|
|
(in thousands) |
|||||||||||||||||||||||||
|
Operating income (loss) |
$ |
94,683 |
|
|
$ |
(56,603 |
) |
|
$ |
3,485 |
|
|
$ |
(17,640 |
) |
|
$ |
23,925 |
|
|
$ |
— |
|
$ |
23,925 |
|
|
Depreciation and amortization |
|
54,055 |
|
|
|
6,258 |
|
|
|
1,816 |
|
|
|
1,017 |
|
|
|
63,146 |
|
|
|
— |
|
|
63,146 |
|
|
Amortization in cost of sales – service |
|
1,602 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,602 |
|
|
|
— |
|
|
1,602 |
|
|
Net unrealized losses on derivatives |
|
21,613 |
|
|
|
5,167 |
|
|
|
8,856 |
|
|
|
— |
|
|
|
35,636 |
|
|
|
— |
|
|
35,636 |
|
|
Lower of cost or net realizable value adjustments |
|
— |
|
|
|
(5,827 |
) |
|
|
(2 |
) |
|
|
— |
|
|
|
(5,829 |
) |
|
|
— |
|
|
(5,829 |
) |
|
Loss on disposal or impairment of assets, net |
|
6,225 |
|
|
|
58,142 |
|
|
|
— |
|
|
|
— |
|
|
|
64,367 |
|
|
|
— |
|
|
64,367 |
|
|
Equity-based compensation expense |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4,177 |
|
|
|
4,177 |
|
|
|
— |
|
|
4,177 |
|
|
Other (expense) income, net |
|
(66 |
) |
|
|
421 |
|
|
|
12 |
|
|
|
125 |
|
|
|
492 |
|
|
|
— |
|
|
492 |
|
|
Adjusted EBITDA attributable to noncontrolling interests |
|
(2,249 |
) |
|
|
— |
|
|
|
— |
|
|
|
(19 |
) |
|
|
(2,268 |
) |
|
|
— |
|
|
(2,268 |
) |
|
Other |
|
2,406 |
|
|
|
4,304 |
|
|
|
44 |
|
|
|
356 |
|
|
|
7,110 |
|
|
|
— |
|
|
7,110 |
|
|
Discontinued operations |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
35 |
|
|
35 |
|
|
Adjusted EBITDA |
$ |
178,269 |
|
|
$ |
11,862 |
|
|
$ |
14,211 |
|
|
$ |
(11,984 |
) |
|
$ |
192,358 |
|
|
$ |
35 |
|
$ |
192,393 |
|
|
|
Three Months Ended September 30, 2025 |
|||||||||||||||||||||||||
|
|
Water Solutions |
|
Crude Oil Logistics |
|
Liquids Logistics |
|
Corporate and Other |
|
Continuing Operations |
|
Discontinued Operations |
|
Consolidated |
|||||||||||||
|
|
(in thousands) |
|||||||||||||||||||||||||
|
Operating income (loss) |
$ |
92,354 |
|
|
$ |
8,224 |
|
|
$ |
6,346 |
|
|
$ |
(12,673 |
) |
|
$ |
94,251 |
|
|
$ |
— |
|
$ |
94,251 |
|
|
Depreciation and amortization |
|
55,550 |
|
|
|
6,063 |
|
|
|
1,540 |
|
|
|
841 |
|
|
|
63,994 |
|
|
|
— |
|
|
63,994 |
|
|
Net unrealized (gains) losses on derivatives |
|
(1,760 |
) |
|
|
(312 |
) |
|
|
1,755 |
|
|
|
— |
|
|
|
(317 |
) |
|
|
— |
|
|
(317 |
) |
|
Lower of cost or net realizable value adjustments |
|
— |
|
|
|
2,519 |
|
|
|
— |
|
|
|
— |
|
|
|
2,519 |
|
|
|
— |
|
|
2,519 |
|
|
Loss (gain) on disposal or impairment of assets, net |
|
5,760 |
|
|
|
3 |
|
|
|
832 |
|
|
|
(1 |
) |
|
|
6,594 |
|
|
|
— |
|
|
6,594 |
|
|
Other income (expense), net |
|
33 |
|
|
|
— |
|
|
|
(18 |
) |
|
|
193 |
|
|
|
208 |
|
|
|
— |
|
|
208 |
|
|
Adjusted EBITDA attributable to noncontrolling interests |
|
(1,259 |
) |
|
|
— |
|
|
|
— |
|
|
|
(98 |
) |
|
|
(1,357 |
) |
|
|
— |
|
|
(1,357 |
) |
|
Other |
|
1,224 |
|
|
|
56 |
|
|
|
66 |
|
|
|
95 |
|
|
|
1,441 |
|
|
|
— |
|
|
1,441 |
|
|
Discontinued operations |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
48 |
|
|
48 |
|
|
Adjusted EBITDA |
$ |
151,902 |
|
|
$ |
16,553 |
|
|
$ |
10,521 |
|
|
$ |
(11,643 |
) |
|
$ |
167,333 |
|
|
$ |
48 |
|
$ |
167,381 |
|
|
|
Six Months Ended September 30, 2026 |
|||||||||||||||||||||||||
|
|
Water Solutions |
|
Crude Oil Logistics |
|
Liquids Logistics |
|
Corporate and Other |
|
Continuing Operations |
|
Discontinued Operations |
|
Consolidated |
|||||||||||||
|
|
(in thousands) |
|||||||||||||||||||||||||
|
Operating income (loss) |
$ |
233,251 |
|
|
$ |
(50,745 |
) |
|
$ |
19,795 |
|
|
$ |
(33,057 |
) |
|
$ |
169,244 |
|
|
$ |
— |
|
$ |
169,244 |
|
|
Depreciation and amortization |
|
107,372 |
|
|
|
12,458 |
|
|
|
3,526 |
|
|
|
1,685 |
|
|
|
125,041 |
|
|
|
— |
|
|
125,041 |
|
|
Amortization in cost of sales – service |
|
3,204 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,204 |
|
|
|
— |
|
|
3,204 |
|
|
Net unrealized losses (gains) on derivatives |
|
2,577 |
|
|
|
(7,438 |
) |
|
|
1,137 |
|
|
|
— |
|
|
|
(3,724 |
) |
|
|
— |
|
|
(3,724 |
) |
|
Lower of cost or net realizable value adjustments |
|
— |
|
|
|
514 |
|
|
|
(55 |
) |
|
|
— |
|
|
|
459 |
|
|
|
— |
|
|
459 |
|
|
Loss (gain) on disposal or impairment of assets, net |
|
8,043 |
|
|
|
58,259 |
|
|
|
(11 |
) |
|
|
(8 |
) |
|
|
66,283 |
|
|
|
— |
|
|
66,283 |
|
|
Equity-based compensation expense |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
6,168 |
|
|
|
6,168 |
|
|
|
— |
|
|
6,168 |
|
|
Other income, net |
|
1,354 |
|
|
|
33 |
|
|
|
353 |
|
|
|
248 |
|
|
|
1,988 |
|
|
|
— |
|
|
1,988 |
|
|
Adjusted EBITDA attributable to noncontrolling interests |
|
(4,195 |
) |
|
|
— |
|
|
|
— |
|
|
|
(40 |
) |
|
|
(4,235 |
) |
|
|
— |
|
|
(4,235 |
) |
|
Other |
|
6,519 |
|
|
|
7,422 |
|
|
|
(249 |
) |
|
|
456 |
|
|
|
14,148 |
|
|
|
— |
|
|
14,148 |
|
|
Discontinued operations |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
70 |
|
|
70 |
|
|
Adjusted EBITDA |
$ |
358,125 |
|
|
$ |
20,503 |
|
|
$ |
24,496 |
|
|
$ |
(24,548 |
) |
|
$ |
378,576 |
|
|
$ |
70 |
|
$ |
378,646 |
|
|
|
Six Months Ended September 30, 2025 |
|||||||||||||||||||||||||
|
|
Water Solutions |
|
Crude Oil Logistics |
|
Liquids Logistics |
|
Corporate and Other |
|
Continuing Operations |
|
Discontinued Operations |
|
Consolidated |
|||||||||||||
|
|
(in thousands) |
|||||||||||||||||||||||||
|
Operating income (loss) |
$ |
177,301 |
|
|
$ |
8,896 |
|
|
$ |
30,078 |
|
|
$ |
(24,574 |
) |
|
$ |
191,701 |
|
|
$ |
— |
|
$ |
191,701 |
|
|
Depreciation and amortization |
|
113,626 |
|
|
|
12,128 |
|
|
|
3,107 |
|
|
|
1,718 |
|
|
|
130,579 |
|
|
|
— |
|
|
130,579 |
|
|
Net unrealized gains on derivatives |
|
(5,274 |
) |
|
|
(1,444 |
) |
|
|
(1,124 |
) |
|
|
— |
|
|
|
(7,842 |
) |
|
|
— |
|
|
(7,842 |
) |
|
Lower of cost or net realizable value adjustments |
|
— |
|
|
|
2,519 |
|
|
|
(2,944 |
) |
|
|
— |
|
|
|
(425 |
) |
|
|
— |
|
|
(425 |
) |
|
Loss (gain) on disposal or impairment of assets, net |
|
9,296 |
|
|
|
3,924 |
|
|
|
(15,823 |
) |
|
|
(2 |
) |
|
|
(2,605 |
) |
|
|
— |
|
|
(2,605 |
) |
|
Other (expense) income, net |
|
(100 |
) |
|
|
1 |
|
|
|
(346 |
) |
|
|
(2,862 |
) |
|
|
(3,307 |
) |
|
|
— |
|
|
(3,307 |
) |
|
Adjusted EBITDA attributable to unconsolidated entities |
|
221 |
|
|
|
— |
|
|
|
4 |
|
|
|
— |
|
|
|
225 |
|
|
|
— |
|
|
225 |
|
|
Adjusted EBITDA attributable to noncontrolling interests |
|
(2,744 |
) |
|
|
— |
|
|
|
— |
|
|
|
(166 |
) |
|
|
(2,910 |
) |
|
|
— |
|
|
(2,910 |
) |
|
Other |
|
2,445 |
|
|
|
112 |
|
|
|
440 |
|
|
|
2,892 |
|
|
|
5,889 |
|
|
|
— |
|
|
5,889 |
|
|
Discontinued operations |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,043 |
|
|
1,043 |
|
|
Adjusted EBITDA |
$ |
294,771 |
|
|
$ |
26,136 |
|
|
$ |
13,392 |
|
|
$ |
(22,994 |
) |
|
$ |
311,305 |
|
|
$ |
1,043 |
|
$ |
312,348 |
|
|
OPERATIONAL DATA |
|||||||
|
(Unaudited) |
|||||||
|
|
Three Months Ended |
|
Six Months Ended |
||||
|
|
September 30, |
|
September 30, |
||||
|
|
2026 |
|
2025 |
|
2026 |
|
2025 |
|
|
(in thousands, except per day amounts) |
||||||
|
Water Solutions: |
|
|
|
|
|
|
|
|
Produced water processed (barrels per day) |
|
|
|
|
|
|
|
|
Delaware Basin |
3,112,866 |
|
2,442,972 |
|
3,038,034 |
|
2,427,382 |
|
Eagle Ford Basin |
177,471 |
|
185,608 |
|
177,093 |
|
193,149 |
|
DJ Basin |
156,352 |
|
174,824 |
|
166,103 |
|
167,064 |
|
Total |
3,446,689 |
|
2,803,404 |
|
3,381,230 |
|
2,787,595 |
|
Recycled water (barrels per day) |
116,215 |
|
141,270 |
|
130,935 |
|
190,289 |
|
Total (barrels per day) |
3,562,904 |
|
2,944,674 |
|
3,512,165 |
|
2,977,884 |
|
Skim oil sold (barrels per day) |
6,356 |
|
5,002 |
|
6,267 |
|
4,803 |
|
|
|
|
|
|
|
|
|
|
Crude Oil Logistics: |
|
|
|
|
|
|
|
|
Crude oil sold (barrels) |
4,604 |
|
3,173 |
|
8,963 |
|
5,597 |
|
Crude oil transported on owned pipelines (barrels) |
5,853 |
|
6,633 |
|
12,558 |
|
11,623 |
|
Crude oil storage capacity – owned and leased (barrels) (1) |
|
|
|
|
5,232 |
|
5,232 |
|
Crude oil inventory (barrels) (1) |
|
|
|
|
262 |
|
712 |
|
|
|
|
|
|
|
|
|
|
Liquids Logistics: |
|
|
|
|
|
|
|
|
Butane sold (gallons) |
122,172 |
|
111,442 |
|
242,018 |
|
208,380 |
|
Propane sold (gallons) |
42,705 |
|
37,305 |
|
83,787 |
|
104,080 |
|
Other products sold (gallons) |
66,881 |
|
74,158 |
|
128,056 |
|
145,774 |
|
Natural gas liquids storage capacity – owned and leased (gallons) (1) |
|
|
|
|
48,941 |
|
49,571 |
|
Butane inventory (gallons) (1) |
|
|
|
|
38,821 |
|
54,976 |
|
Propane inventory (gallons) (1) |
|
|
|
|
14,403 |
|
18,071 |
|
Other products inventory (gallons) (1) |
|
|
|
|
7,812 |
|
4,849 |
| ________________ | |
|
(1) |
Information is presented as of September 30, 2026 and September 30, 2025, respectively. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20261105569260/en/
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