NGL Energy Partners LP (NGL-PB) Q2 2025 Earnings Report

NGL Energy Partners LP reported Q2 2025 with a continuation of revenue and earnings pressure alongside a high leverage profile. Revenue of $1.3527 billion declined 26.5% year-over-year and 2.5% quarter-over-quarter, driven by softer throughput and weaker market environments in several segments. Gross profit was $169.5 million for a gross margin of ~12.5%, with EBITDA at $143.1 million and operating income of $77.7 million (margins ~5.75%). Net income was modest at $2.45 million, translating to an EPS of -$0.21 for the quarter, underscoring the gap between operating performance and bottom-line profitability due to financing costs and non-operating items.

The balance sheet shows a sizable asset base ($4.89B) paired with elevated leverage: total debt of $3.231B and net debt of $3.223B, contributing to an interest-coverage ratio near 1.0x. Free cash flow remained negative at -$82.9 million, amid capital expenditures of about -$89.6 million and working-capital movements. Operational cash flow was modest at $6.7 million, while financing activity contributed $70.3 million to liquidity, resulting in a small net cash outflow of $0.77 million for the period. While EBITDA remains a robust operational proxy given the midstream context, the company faces near-term deleveraging and liquidity considerations given the debt burden and limited current-period cash-flow resilience.

From a qualitative standpoint, absent a transcript-based view, the quarter appears characterized by ongoing volume and margin pressure with a disciplined capital deployment posture. The near-term investment thesis hinges on stabilizing volumes, improving throughputs across the Water Solutions, Crude Oil Logistics, and Liquids Logistics platforms, and progress on deleveraging to restore balance-sheet flexibility. Investors should monitor (i) commodity-price-driven volume trends, (ii) capex cadence and its impact on free cash flow, and (iii) any management commentary on disposition of assets, financing strategy, or dividend sustainability.