TULSA, Okla.--(BUSINESS WIRE)-- NGL Energy Partners LP (NYSE: NGL) (“NGL,” “we,” “us,” “our,” or the “Partnership”) today reported its first quarter Fiscal 2027 financial results. Highlights include:

Financial Results:

• Income from continuing operations for the first quarter of Fiscal 2027 of $80.0 million, compared to income from continuing operations of $30.3 million for the first quarter of Fiscal 2026
• Adjusted EBITDA from continuing operations(1) for the first quarter of Fiscal 2027 of $186.2 million, compared to $144.0 million for the first quarter of Fiscal 2026, nearly 30% 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 3.32 million barrels per day during the first quarter of Fiscal 2027, growing 19.6% from the first quarter of Fiscal 2026
• Paid and physically disposed water volumes of 3.43 million barrels per day during the first quarter of Fiscal 2027, growing 12.1% from the first quarter of Fiscal 2026
• Permitted injection capacity was increased by approximately 195,000 barrels during the first quarter of Fiscal 2027

Guidance:

• Raised our full year Fiscal 2027 Adjusted EBITDA(2) guidance to $725-$735 million

“NGL is off to a very strong start to Fiscal 2027, the first quarter results were driven primarily by the Water Solutions segment. We are raising our full year guidance for Adjusted EBITDA(2) from $715-$725 million to $725-$735 million based on our first quarter outperformance. We continue to see growth opportunities in the Water Solutions segment and expect the strong Water Solutions momentum to carry on for the remainder of this fiscal year which would allow us to further increase Adjusted EBITDA(2) guidance.” 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:

Water Solutions

Operating income for the Water Solutions segment increased by $53.6 million for the quarter ended June 30, 2026, compared to the quarter ended June 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 3.32 million barrels of produced water per day during the quarter ended June 30, 2026, a 19.6% increase when compared to approximately 2.77 million barrels of water per day processed during the quarter ended June 30, 2025.

Revenues from recovered skim oil, including the impact from realized skim oil hedges, totaled $40.3 million for the quarter ended June 30, 2026, an increase of $15.5 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 $8.0 million for the quarter ended June 30, 2026, compared to the quarter ended June 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 higher severance taxes due to the increase in revenue from recovered crude oil. Operating expense per produced barrel processed was $0.21 for the quarter ended June 30, 2026, compared to $0.22 in the comparative quarter last year.

There was also an increase in net unrealized gains on skim oil hedges of $15.5 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 increased by $5.2 million for the quarter ended June 30, 2026, compared to the quarter ended June 30, 2025. The increase was due primarily to increased gains on derivatives and lower losses on the disposal of assets. These increases were partially offset by lower product margins, due to the expiration of a commercial contract and selling higher priced inventory into a declining market. During the quarter ended June 30, 2026, physical volumes on the Grand Mesa Pipeline averaged approximately 74,000 barrels per day, compared to approximately 55,000 barrels per day for the quarter ended June 30, 2025.

Liquids Logistics

Operating income for the Liquids Logistics segment decreased by $7.4 million for the quarter ended June 30, 2026, compared to the quarter ended June 30, 2025. This decrease was due primarily to the gain recognized in the prior year period from the sale of most of our Wholesale Propane business and 17 of our natural gas liquids terminals (“Wholesale Propane Disposition”). The decrease was partially offset by increased butane and propane margins, increased service revenue due to a new throughput contract and increased gains from derivative activity.

Capitalization and Liquidity

Total liquidity (cash plus available capacity on our asset-based revolving credit facility (“ABL Facility”)) was approximately $203.6 million as of June 30, 2026. Borrowings on the Partnership’s ABL Facility totaled approximately $177.0 million as of June 30, 2026, due 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.

First Quarter Conference Call Information

A conference call to discuss NGL’s results of operations is scheduled for 4:00 pm Central Time on Tuesday, August 4, 2026. Analysts, investors, and other interested parties may join the webcast via the event link: https://www.webcaster5.com/Webcast/Page/2808/54286 or by dialing (888) 506-0062 and providing conference code: 303193. 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 54286.

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. EBITDA and Adjusted EBITDA should not be considered as alternatives to net income, 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.

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David Sullivan, 918-495-4631

Senior Vice President - Finance

[email protected]

Source: NGL Energy Partners LP