How did NGL Energy Partners' revenue and expenses shift in Q3 2025?

NGL Energy Partners LP experienced a notable shift in its revenue and expense landscape in Q3 2025, reflecting strategic adjustments and operational changes: 1. **Revenue Shift**: - **Crude Oil Logistics and Liquids Logistics Segment Performance**: The Crude Oil Logistics segment saw a significant decrease in revenue from $425,294 in Q3 2024 to $195,646 in Q3 2025. This decline is attributed to the winding down of the biodiesel business, which negatively impacted the quarter's adjusted EBITDA by $12.1 million. - **Water Solutions Segment Growth**: In contrast, the Water Solutions segment showed growth, with revenues increasing from $179,301 in Q3 2024 to $187,268 in Q3 2025. This segment's adjusted EBITDA also rose to $132.7 million in Q3 2025, up from $121.3 million in the prior year. - **Total Revenues Decline**: Despite the segment-specific gains, total revenues decreased from $1,869,777 in Q3 2024 to $1,549,073 in Q3 2025. |code|Ticker|Name|Date|Cost of Goods Sold|Total Revenue|Operating Expenses|market_code| |---|---|---|---|---|---|---|---| |NGL|NGL.N|NGL Energy Partners|2024 Q4|1.402885E9|1.629594E9|0|169| |NGL|NGL.N|NGL Energy Partners|2025 Q1|1.173208E9|1.387259E9||169| |NGL|NGL.N|NGL Energy Partners|2025 Q2|1.199327E9|1.352675E9||169| |NGL|NGL.N|NGL Energy Partners|2025 Q3|1.309952E9|1.549073E9||169| 2. **Expense Shift**: - **Operating Expense Reductions**: NGL Energy Partners effectively managed expense reductions, particularly in the Water Solutions segment. Operating expenses decreased from $0.25 to $0.21 per produced barrel processed. - **Adjusted EBITDA Variations**: The company's adjusted EBITDA for Q3 2025 was $147.7 million, down from $151.7 million in the same period of the previous year. This decline was influenced by the negative EBITDA from the biodiesel operations. 3. **Strategic Implications**: - **Asset Sales Impact**: NGL Energy Partners completed the sale of several key assets, including natural gas liquids terminals and other business segments, for approximately $270 million. These sales are aimed at reducing debt and refining the company’s capital structure. - **Growth Focus**: The company is focusing on growth in core areas, such as the Crude Oil Logistics segment, where new long-term contracts have been secured with Prairie Operating and another producer, potentially increasing crude oil volumes on the Grand Mesa pipeline to 100,000 barrels per day. In conclusion, NGL Energy Partners faced a decline in total revenues but showed improvements in certain segments and operational efficiencies. Strategic asset sales and focus on core operations are key aspects of the company's approach to navigating current market challenges.