From: Elroy | 8/6/2024 3:17:54 PM | | | | Hopefully this means they are producing more cash than expected, and at a minimum they aren't going bankrupt.......
ch-aviation.com
Odd news for a partnership that had preferred stock in arrears for three years until about three months ago, and hasn't paid a distribution for three years.
Hopefully it indicates positive news on the horizon.... |
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From: Elroy | 8/6/2024 4:22:08 PM | | | | This is the only publicly traded peer company for NGL's water business. It's about 40% the size of NGL's water business (and a potential acquisition target down the road, I think).
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Aris Water Solutions, Inc. Reports Second Quarter 2024 Results, Increases Full Year Adjusted EBITDA Guidance
finance.yahoo.com
Full year EBITDA forecast got increased from $185m-$200m to $195m to $205m.
I'm not all that familiar with the specifics of their drivers, but I think Q2 came in better than they were expecting. Q2 EBITDA was forecast as $44m to $48m, and it actually came in at $50m.
Hopefully something similarly positive happens with NGL.... |
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From: Elroy | 8/8/2024 6:30:57 PM | | | | NGL Energy Partners LP Announces First Quarter Fiscal 2025 Financial Results
finance.yahoo.com
These numbers look OK to modestly positive. Positive because nothing nasty appears to have happened, and in these big complex energy companies it seems like something often goes wrong.
I listened to the conference call, and the main important thing they said was water volumes in the month of July were 2.7m processed (versus 2.43m in June Q) and 0.3m paid but not processed (due to minimum volume commitments) (versus 0.16m in June Q). So.....in the month of July, water volumes are up 15% compared to the June Q average. If that continues for all of the Sep Q, it means water EBITDA is going to be about $170m+, which means they're going to easily exceed their fiscal '25 EBITDA forecast.
Water is the best segment in terms of profits. If that segment grows, nothing else matters too much.
Whether NGL units respond to this positive conference call news about July water volumes or not, I got no idea, but it definitely gives us something to look forward to when they report the Sep quarter. |
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From: Elroy | 8/12/2024 8:33:28 AM | | | | Lets see, some simple thoughts on NGL.
The partnership was near $6 before reporting Q1 2024 results in early June. At that time NGL was expected to do $645m in trailing four quarters EBITDA.
Q1 2024 missed EBITDA by about $35km, and the price drifted down to $4.
Now NGL has reported June Q 2025 results, and is on track to deliver $655m EBITDA in early June 2025. Further, while water sales in June Q 2024 were merely OK (flat with the previous quarter) they indicated that the month of July had water sales up more than 15% from the June Q levels. If that keeps up, then water EBITDA should jump strongly in Sep 2024. Then we've got the Lex 2 new pipeline completing in October and going into production, further increasing water sales and EBITDA. The other two divisions did generally well in June Q 2024, and so everything seems to be going along well, with water accelerating. $655m EBITDA for the four months through March 2025 seems very achievable, and perhaps low is water accelerates a bit.
So I think it seems reasonable for NGL to get back to $6.00 as this becomes clear to the market (hopefully after the next quarter), and then perhaps higher than $6.00 because once the June and Sep 2024 quarters are in the rear view mirror, and replaced by June and Sep 2025 EBITDA numbers in the outlook, NGL should be look to do $680m-$700m per four quarters fairly easily.
In other words, it seems reasonably likely (if everything just goes as planned) that Q2 2024 was the fundamental bottom, and the trends (EBITDA at least, that seems to be the important thing) is on it's way up. If that trend is accurate, and NGL can shift from a floor multiple to some sort of growth multiple, the unit price should react very well. |
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From: Elroy | 9/24/2024 9:29:58 AM | | | | NGL Energy Partners LP Announces Quarterly Cash Distribution for the Class B, Class C, and Class D Preferred Units
finance.yahoo.com
TULSA, Okla., September 19, 2024--( BUSINESS WIRE)--NGL Energy Partners LP (NYSE: NGL) announced today that the Board of Directors of its general partner declared a distribution for the quarter ending September 30, 2024 to be paid to the holders of the Partnership’s 12.806% Class B Floating Rate Cumulative Redeemable Perpetual Preferred Units ("Class B Preferred Units") and the 12.716% Class C Floating Rate Cumulative Redeemable Perpetual Preferred Units ("Class C Preferred Units") in accordance with the terms outlined in NGL’s partnership agreement. Each of the Class B Preferred Units will receive a quarterly distribution of $0.8004 and each of the Class C Preferred Units will receive a quarterly distribution of $0.7947 per unit on October 15, 2024, to holders of record on October 1, 2024.
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This is the second dividend payment since the NGL preferred came out of arrears and became current. If NGL just reports reasonably well, and investors believe the preferred dividends will continue, I would expect their prices to rise above $25 par value. Both B's and C's pay above 12.5%. That's going to be super attractive as interest rates decline.
Both B's and C's float, so the declines in interest rates will also reduce the preferred dividend, but they're still going to be much more attractive than cash.
NGL has perked up a bit recently. The next three quarters of results should show a significant improvement in free cash flows, giving the partnership lots of options of what to do with the cash. The next big milestone is the not publicly traded preferred D series (about $600m) which expires in summer 2025. NGL has to either repurchase them or refinance them before then. |
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To: Elroy who wrote (96) | 9/24/2024 1:15:05 PM | From: FIFO_kid2 | | | I was quite surprised the stock sold off below $4 given the short term catalyst with Lex 2. I saw it as a gift and my average now is down to 4.35. Hoping the size of my position doesn't trigger UBTI |
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To: FIFO_kid2 who wrote (97) | 9/24/2024 2:33:36 PM | From: Elroy | | | The June Q2 (fiscal Q1) results they said were good, but it left the full year EBITDA target as fairly back end loaded. I still wonder (even with Lex 2) how they're going to make it.
June Q had $144m EBITDA, and the full year guidance is $665m. It means the Sep-Dec-Mar quarters need to average about $172m in EBITDA.
They seem to believe it will happen. If it does, I'd expect the unit price to be well above $6 by June 2025, maybe higher. |
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From: Elroy | 9/30/2024 1:36:09 PM | | | | Today is the last day to buy the B or C NGL preferred stock and receive the 80 cents dividend.
Both trade ex-div tomorrow.
I bet they drop less than 80 cents. I think as the markets come to believe these preferreds will remain current, they likely trade above $25 par price. Both are about $24 today, and pay 80 cents after the close.
There's not a lot of stuff out there yielding 12.5%. I think NGL's balance sheet improving over the next 1 or 2 reports should push the preferreds up to at least $25.
finance.yahoo.com |
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From: Elroy | 10/1/2024 2:47:25 PM | | | | NGL B and C have dropped to about $23 now that they've earned the 80 cents dividend. Both yield 13.5%-14% at the current $23 price. NGL's cash flows should improve quite a lot beginning with the December 2024 quarter, and I think the preferreds will stay out of arrears.
Now's a good chance to pick up a decent income yield in these two preferred stocks - Schwab tickers are NGL/PRB or NGL/PRC. |
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From: Elroy | 10/13/2024 9:50:06 AM | | | | Some interesting items on NGL from the previous conference call (early August).
Water Solutions ... volumes we were paid to dispose that includes deficiency volumes were 2.59 million barrels per day in the first quarter.... The Water Solutions segment ... averaging approximately 2.7 million barrels per day in the month of July. When you include deficiency volumes in July, we will be paid on approximately 3 million barrels per day.
The LEX II water pipeline project with initial capacity of 200,000 barrels per day that is expandable to 500,000 barrels per day is on schedule with an in-service date in October.
Liquids Logistics adjusted EBITDA was $11.5 million in the first quarter... The first quarter is typically the low point of the EBITDA stream for the Liquids segment.
We are reaffirming our full-year guide of $665 million of EBITDA for the partnership and $550 million to $560 million for Water Solutions.
Comment - there are three more quarters to be reported in the "full year". Guidance implies quarterly EBITDA of $174m. Lex 2 launch should add about $10m EBITDA per Q in Dec and March, but still, the EBITDA growth trajectory (if it is met) should easily push the units above $6.00......
Remember that reduced leverage is a function of both lower debt balances and increased EBITDA.
I think he makes this comment because they expect meaningfully increased EBITDA. So leverage will decline by EBITDA growth more than absolute debt reduction. |
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