NGL Energy Partners LP (NGL-PC) Q3 2025 Earnings Report

NGL Energy Partners LP (NGL-PC) delivered QQ3 2025 results reflecting solid operating cash generation set against ongoing margin pressures in the energy midstream complex. Revenue of $1.549B rose meaningfully versus the prior quarter (QoQ increase of approximately 14.5%), while year-over-year revenue declined about 17%. The quarter produced EBITDA of $143.83M and operating income of $75.50M, translating into EBITDA and operating margins of roughly 9.28% and 4.87%, respectively. Net income for the quarter was $13.51M, but reported earnings per share (EPS) were negative at -0.12, highlighting lingering effects of debt service and non-operating items on bottom-line profitability. Free cash flow generation remained a positive near-term attribute, with free cash flow of $95.37M and net operating cash flow of $153.79M, supporting deleveraging and liquidity needs despite a large absolute debt burden (total debt close to $3.20B and net debt around $3.198B).

From a balance sheet perspective, liquidity remains modest (cash and cash equivalents of about $5.68M) with a current ratio near 1.20 and a quick ratio just above 1.0, implying modest near-term liquidity cushions. The company completed the quarter with a cautious debt posture: total debt of $3.203B and a debt ratio around 0.661, alongside an EBITDAR margin of ~9.28% and an interest coverage ratio of ~1.12x, suggesting limited cushion against rising funding costs in a tighter credit environment. Management commentary (where available) focused on sustaining cash flow for capital allocation, maintaining operational reliability across Water Solutions and Logistics, and pursuing efficiency initiatives to offset margin compression in a high-commodity-price environment.

Overall, the QQ3 2025 results reinforce a credible operating cash generation profile for NGL-PC, but reflect a challenging margin backdrop, elevated leverage, and a valuation that implies a significant premium relative to many midstream peers. The investment thesis hinges on disciplined capital allocation, continued free cash flow generation, and the company's ability to de-lever while maintaining service levels across its three segments.