NGL Energy Partners LP Announces Second Quarter Results and Filing of Form 10-Q
TULSA, Okla.--(BUSINESS WIRE)-- NGL Energy Partners LP (NYS: NGL) , "NGL Energy," today reported net income of $10.1 million and Adjusted EBITDA of $26.3 million for the three months ended September 30, 2012. Net income per limited partner common unit for the quarter was $0.18. General and administrative expenses during the quarter ended September 30, 2012 included $0.6 million of costs related to acquisitions.
NGL Energy's results of operations for the three months ended September 30, 2012 include the operations acquired in a June 2012 merger with High Sierra Energy, LP ("High Sierra"), which contributed significantly to NGL Energy's net income. High Sierra's businesses include crude oil gathering, transportation and marketing; water treatment, disposal, and transportation; and natural gas liquids transportation and marketing.
For the six month period ended September 30, 2012, NGL Energy reported a net loss of $14.6 million and Adjusted EBITDA of $19.9 million. Net loss per limited partner common unit for the six months ended September 30, 2012 was $(0.37). The net loss was impacted by the following items:
- General and administrative expenses during the quarter ended June 30, 2012 included $3.5 million of costs related to the merger with High Sierra.
- NGL recorded a loss of $5.8 million resulting from the accelerated amortization of previously capitalized debt issuance costs upon closing of its new revolving credit facility.
- Declining propane prices during April and May 2012 had an adverse impact on margins of NGL's wholesale marketing and supply segment, which NGL expects to recover when delivering future volumes. NGL has contracts whereby it has committed to purchase ratable volumes of propane at index prices. NGL seeks to manage the price risk associated with these contracts primarily by selling the inventory not stored immediately after it is received. When NGL sells product, it records the cost of sale at the average cost of all inventory at that location, which may include inventory purchased earlier at higher prices and stored for sale in the future. During periods of falling prices, this results in negative margins on these sales.
During October 2012, NGL Energy completed a business combination whereby it acquired certain entities that operate salt water disposal wells and related assets. During October and November 2012, NGL Energy acquired two retail propane businesses. On November 1, 2012, NGL Energy completed a business combination whereby it acquired certain entities that conduct crude oil purchasing and logistics operations in Texas and New Mexico.
A conference call to discuss NGL Energy's results of operations is scheduled for 3:00 p.m. Central Time on November 19, 2012. Analysts, investors, and other interested parties may access the conference call by dialing (800) 510-9661 and providing access code 81546845. An audio replay of the conference call will be available for 7 days beginning at 4:00 p.m. Central Time on November 19, 2012 and can be accessed by dialing (888) 286-8010 and providing access code 85915820.
NGL Energy also announced that it has filed its quarterly report on Form 10-Q for its fiscal quarter ended September 30, 2012 with the Securities and Exchange Commission. NGL Energy has posted a copy of the Form 10-Q on its website at www.nglenergypartners.com.
NGL Energy defines EBITDA as net income (loss) attributable to parent equity, plus income taxes, interest expense and depreciation and amortization expense. NGL Energy defines Adjusted EBITDA as EBITDA excluding the unrealized gain or loss on derivative contracts and the gain or loss on the disposal of assets and share-based compensation expenses. EBITDA and Adjusted EBITDA should not be considered an alternative to net income, income before income taxes, cash flows from operating activities, or any other measure of financial performance calculated in accordance with GAAP as those items are used to measure operating performance, liquidity or the ability to service debt obligations. NGL Energy believes that EBITDA provides additional information for evaluating its ability to make quarterly distributions to its unitholders and is presented solely as a supplemental measure. NGL Energy believes that Adjusted EBITDA provides additional information for evaluating its financial performance without regard to its financing methods, capital structure and historical cost basis. Further, EBITDA and Adjusted EBITDA, as NGL Energy defines them, may not be comparable to EBITDA and Adjusted EBITDA or similarly titled measures used by other entities. A reconciliation of Adjusted EBITDA to net income (loss) attributable to parent equity is shown below.
About NGL Energy Partners: NGL Energy Partners LP owns and operates a vertically integrated energy business. For further information about NGL Energy and the financial results disclosed in this press release, see NGL Energy's website at www.nglenergypartners.com.
|NGL ENERGY PARTNERS LP|
|Unaudited Condensed Consolidated Balance Sheets|
|As of September 30, 2012 and March 31, 2012|
|(U.S. Dollars in Thousands, except unit amounts)|
|September 30,||March 31,|
|Cash and cash equivalents||$||26,009||$||7,832|
Accounts receivable - trade, net of allowance for doubtful accounts of $1,356 and $818, respectively
|Receivables from affiliates||3,238||2,282|
|Prepaid expenses and other current assets||57,000||10,002|
|Total current assets||736,297||198,624|
PROPERTY, PLANT AND EQUIPMENT, net of accumulated depreciation of $25,326 and $12,843, respectively
|INTANGIBLE ASSETS, net of accumulated amortization of $17,646 and $8,174, respectively||345,942||139,780|
|OTHER NONCURRENT ASSETS||5,658||2,766|
|LIABILITIES AND PARTNERS' EQUITY|
|Trade accounts payable||$||419,750||$||81,369|
|Accrued expenses and other payables||68,724||14,143|
|Advance payments received from customers||74,814||20,293|
|Payables to affiliates||11,780||9,462|
|Current maturities of long-term debt||78,033||19,484|
|Total current liabilities||653,101||144,751|
|LONG-TERM DEBT, net of current maturities||569,903||199,177|
|OTHER NONCURRENT LIABILITIES||2,599||212|
|COMMITMENTS AND CONTINGENCIES|
|General Partner — 0.1% interest; 50,821 and 29,245 notional units outstanding, respectively||(51,052||)||442|
|Limited Partners — 99.9% interest —|
|Common units — 44,850,439 and 23,296,253 units outstanding, respectively||839,977||384,604|
|Subordinated units — 5,919,346 units outstanding at September 30, 2012 and March 31, 2012||11,784||19,824|
|Accumulated other comprehensive income —|
|Foreign currency translation||28||31|
|Total partners' equity||803,816||405,329|
|Total liabilities and partners' equity||$||2,029,419||$||749,469|
|NGL ENERGY PARTNERS LP|
|Unaudited Condensed Consolidated Statements of Operations|
|Three Months and Six Months Ended September 30, 2012 and 2011|
|(U.S. Dollars in Thousands, except unit and per unit amounts)|
|Three Months Ended||Six Months Ended|
|September 30,||September 30,|
|Natural gas liquids logistics||350,368||190,816||541,985||368,809|
|Crude oil logistics||711,021||-||784,538||-|
|COST OF SALES:|
|Natural gas liquids logistics||328,283||188,246||512,328||366,113|
|Crude oil logistics||693,687||-||770,570||-|
|Total Cost of Sales||1,053,690||201,454||1,352,675||387,427|
|OPERATING COSTS AND EXPENSES:|
|General and administrative||10,443||4,164||20,403||6,200|
|Depreciation and amortization||13,361||1,701||22,588||3,078|
|Operating Income (Loss)||18,585||(4,528||)||3,511||(10,211||)|
|OTHER INCOME (EXPENSE):|
|Loss on early extinguishment of debt||-||-||(5,769||)||-|
|Income (Loss) Before Income Taxes||10,159||(5,395||)||(14,092||)||(12,168||)|
|INCOME TAX PROVISION||(77||)||-||(536||)||-|
|Net Income (Loss)||10,082||(5,395||)||(14,628||)||(12,168||)|
|Net (Income) Loss Allocated to General Partner||(694||)||5||(789||)||12|
|Net (Income) Loss Attributable to Noncontrolling Interests||(9||)||-||51||-|
|Net Income (Loss) Attributable to Parent Equity|
|Allocated to Limited Partners||$||9,379||$||(5,390||)||$||(15,366||)||$||(12,156||)|
|Basic and Diluted Earnings (Loss) per Common Unit||$||0.18||$||(0.36||)||$||(0.37||)||$||(0.88||)|
|Basic and Diluted Earnings (Loss) per Subordinated Unit||$||0.18||$||(0.36||)||$||(0.38||)||$||(0.88||)|
|Basic and Diluted Weighted average units outstanding:|
The following table summarizes the volume of product sold and wastewater processed for the three months and six months ended September 30, 2012 and 2011. Gallons sold by our natural gas liquids logistics segment shown in the table below include sales to our retail segment.