- Earnings call transcript Q2 2023

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Operator

Good day, ladies and gentlemen, and welcome to the NGL Energy Partners LP 2Q '23 Earnings Call. [Operator Instructions]

It is now my pleasure to turn the floor over to your host, Linda Bridges, CFO at NGL Energy Partners. Ma'am, the floor is yours.

Linda Bridges

Hi, and welcome to NGL's second quarter fiscal 2023 earnings call.

filed to can attention end be earnings which like harbor our of I'd this release, which closed language, found was usual, call to your safe today's afternoon. As market after towards the

ended other our factors that Management's Today's and the like of set forth Private the website results in remarks Form attention to discussed by of In direct cause statements. XXXX, from safe Securities meaning These, March Act, the on the earnings Partnership, the the release Act the accordance Reform your those actual in may contained with year annual on statements Discussion the Litigation XX, I Partnership's in the section website. report such SEC's forward-looking and for SEC filings XXXX. XX-K any could forward-looking contain to statement risk factors and and within Analysis available and would important differ the together in to which also materially on are with made harbor the

the into Jumping financials.

showed totaling strong a increase Solutions totaled segment fiscal of for compared million the quarter volumes adjusted quarter. Adjusted very second representing Water performance EBITDA the in and $XXX.X year-to-date first half with during $XXX.X Our million, our EBITDA growth fiscal to XX% XXXX.

fiscal on from year Basin We from growing approximately continue volume day, to grows. volume over producers quarter system the actively as particularly Delaware million new previous see comparable last disposal complete and nearly X.X the water per processed increases base the our X% in Produced in barrels quarter. wells the XX% and volumes, totaled water

million strong in skim includes disposal oil of barrel OpEx offset over for year guidance remain our confident this [Technical segment. $XXX We per $X.XX. revenue Total which at by full and Difficulty] remained

respective fiscal periods $XX quarter compared The Liquids the the million million million to last $XX.X and adjusted $XX.X of segment EBITDA reported year-to-date $XX.X and for XXXX second of for Logistics year. million

tighter this certain and in driven again margins refined supply in segment strong on products by to markets. were Results due volumes biodiesel

declined due were last sales at earlier as year and propane on market decreasing fiscal volumes in spot inventory the butane prices product margins the the Our purchased a higher market compared period price cost based of applied through to to to price. year

expect to contracts. inventory our higher with as price environment, in inventory realize lower margins fixed price We our sales the increase we current replace a with our margin and purchased associated forward

seasons, begin we see As enter heating peak this increased segment. and blending to we should flow from into cash

A Logistics $XX.X of adjusted $XX.X net the Oil on impacted our by losses Difficulty] negatively fourth and EBITDA quarter of the million in reported fiscal that [Technical Crude first XXXX. million quarter to related results inventory financial gains that for year-to-date. quick quarter derivatives reminder were

well full whose result decreased with Grand declining producer issues, contracted the quarter as oil higher on decreases volumes contracts. during margins physical [Technical Mesa these physical increased certain rates While as as contracts due to price the to Basin, in as DJ certain on adder volumes we increased of sales realize related were permitting Difficulty] a by rates producers other crude certain differentials the on strong offset in volume part with

in the second the and we're move quarter, recent delays, to are permitting third rig working impacts we count we half seeing producers how fiscal our of Basin increase our as DJ Additionally, increase into are their in fiscal some as through eager year. volume see

adjusted plus contribute Logistics fiscal -- segment guidance Logistics and continue net a to Crude EBITDA corporate to will that the for us Oil of We expect expect to expenses, XXXX. of million EBITDA adjusted all Liquids bring total we $XXX

are facility of deep we fiscal season on on into XXth, a on reminder, we borrowings increase businesses our September million our butane ABL facility propane total second build. result with -- build for our to of $XXX expect million. during perspective, total and expected sheet borrowings did we inventory as quarter our reported and balance inventory and the of ABL a A From liquidity $XXX this

As over expect on in year. facility of we the to point months, our the of borrowings near borrowings liquidated six see inventory is decreases being end next the low with ABL corresponding the fiscal

for With that, to Mike I'll it turn comments. additional

Mike Krimbill

Linda. Thanks,

for our of of heard, guidance EBITDA NGL, have all fiscal and you $XXX As we in for of $XXX are million million XXXX Water over Solutions. excess confirming

EBITDA changed we like to respect can would where is would as color we to a evaluate With this position like some where guidance to EBITDA be provide That these We I trending. have haven't beat the this this approximately said, in numbers. fiscal million to half repeating results second in million fiscal achieved $XXX performance the in year. six Water Solutions, of Obviously, EBITDA. the $XXX of first in we of of months year

say, Oil processed Crude current about second In is the averaging X% going quarter, results products above date, of experiencing volumes this November a refined albeit is waiting small the first Logistics segment. quarter. to this an in third which of biodiesel, uptick XX Mesa. strong from are we DJ days is Logistics and sideways, might production increased you Liquid October part Grand and month for are volumes water on and they

capacity. benefit business. U.S. wholesale welcome half the change back in than the as year same boost temperatures last a propane currently recent are weather Butane segment Colder of the much if blending operating is weather the normal in above had period. occurs, near should to And November of time much and change and perform expectations compared our for for we a refineries it is at December this will

we the to approximately XX, to unsecured bringing year-to-date, repurchased of million on notes balance calls, $XX As $XXX focus the continue our have previous and of as balance XXXX we September mentioned sheet million have in XXXX.

to of the ABL cash repay maturity, to facility. 'XX prior and using on expect We borrowings needed, free flow notes balance if the our

notes the are pursued to notes our previously as EBITDA deleveraging These our times. initiatives us corporate to on the and certain X.XX fiscal process. are and combined both, we flow to by delever would repay XXXX Additionally, XXXX discussed, debt accelerate to successful, early the if free being will through Reducing with year-end. cash that allow working still initiatives corporate corporate initiatives, retire increased

with for think I we questions. that, open up

Operator

Instructions] you. the [Operator Lynch. first from Merrill Leven is question from Will coming And [ph] Thank

Unidentified Analyst

just the Hi, guys. drop total [Technical I'm you. looking of liquidity at Thank Difficulty]

Operator

Apologies. please. It looks we can like just Will. See him we One if lost, back. moment get

get Okay. Will to We'll try And meantime... the back. in

Linda Bridges

Yes.

think our sorry, facility. I ABL million. cash available borrowings, referenced it the what plus Will of can think really is Again, was, we question had think address I I the define -- liquidity -- was available $XXX drop which as he liquidity, on capacity, I'm I

increase period. excess or as decrease our -- of in will will half the our support the build Our inventory to naturally borrowings, into butane fiscal in year. liquidating They'll the second fall that on inventory we ABL inventory capacity meaning propane and during that We fall facility build begin the capacity facility ABL businesses.

to of So, as inventory ABL repay would be we to up facility. Difficulty] on [Technical build those from our the expected back liquidation borrowings use proceeds

spring. then So, increases a very consistent seeing trend you'll in and and heating into the we is decreases you seasons borrowings as blending early this that fall, exit the have summer, our start see late you'll in where

that on the line. was have think Will that the answers hopefully, don't But that back the I know question. question. we I

Operator

Krimbill Thank were hand to there would some Mike I has no now the other [Operator Will back like questions. closing come you. And Unfortunately, to remarks. not call on. for Instructions] back

Mike Krimbill

Okay. had Well, good a are for the and we last that quarter track numbers call felt like earnings on and provided we one. we this

you very much. thank So,

Operator

This ladies conclude and gentlemen. conference. Thank does today's you,

this at and lines time, day. your disconnect your may for You a have Thank you participation. wonderful

NGL Energy Partners (NGL) 9 Nov 222023 Q2 Earnings call transcript