NGL Energy Reports Steep Drop in Net Income, Expects $500 Million Growth Capex for Fiscal 2016

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Researched by Industrial Info Resources (Sugar Land, Texas)--Full-service midstream provider NGL Energy Partners LP (NYSE:NGL) (Tulsa, Oklahoma) reported net income of $29.9 million for the fiscal year ended March 31, down 39% from fiscal-year 2014. The company contended with adverse markets, a 50% decline in crude oil prices and underutilized storage assets, according to Chief Executive Officer Mike Krimbill.

Industrial Info is tracking 11 NGL Energy projects that have a total worth of $1.27 billion. All are in the planning phases. Company officials said growth capital expenditures (capex) for the current fiscal year are expected to be roughly $500 million.

Krimbill said the company exceeded expectations and guidance for the year, despite various challenges, including backwardated markets and underused storage assets at Cushing, Oklahoma. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were $443.3 million for the year, a 64% increase from the previous fiscal year, he said during the company's earnings conference call. The company set its adjusted EBITDA guidance for fiscal 2016 at $500 million or greater.

Revenue for the fiscal year totaled $16.8 billion, compared with $9.7 billion in fiscal 2014.

For related information, see February 11, 2015, article - NGL Energy Partners Incurs Heavy Costs in Fiscal Third Quarter, Exceeds Plans for 2015 Growth Capex.

NGL Energy noted that during the fiscal year ended March 31, it began construction of the Grand Mesa Pipeline, a 20-inch pipeline that will move 200,000 barrels per day (BBL/d) of Denver-Julesburg (DJ) Basin/Wattenberg crude oil more than 500 miles from Weld County, Colorado, to the company's terminal in Cushing.

"NGL completed a successful open season in which it received the requisite support, in the form of ship-or-pay volume commitments from multiple shippers," the company said in its earnings press release.

Industrial Info is tracking seven projects, totaling $1.1 billion in investment value, connected to the Grand Mesa Pipeline. Construction kickoff is slated for third-quarter 2015, with completion in third-quarter 2016. For related information, see June 1, 2015, article - Where the Crude Flows: Gulf Coast and Cushing.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.