NGL - Why Units of NGL Energy Partners Slumped More Than 15% in March
2023-04-06 08:50:57 ET
Units of NGL Energy Partners (NYSE: NGL) declined by 15.7% in March, according to data provided by S&P Global Market Intelligence . The master limited partnership (MLP) cooled off after a scorching triple-digit rally in February . The slump came despite more good news from the energy company as it has continued to improve its balance sheet over the past month.
Units of NGL Energy Partners skyrocketed in February after the company reported strong fiscal third-quarter results. That enabled it to generate more cash to shore up its balance sheet, including repaying a portion of its unsecured notes set to mature in June. That was part of an ongoing effort to pay off those notes by their maturity date. It achieved that objective in February after its lenders permanently increased the borrowing capacity on its asset-based lending (ABL) facility to $600 million. That allowed the company to call for the early redemption of its remaining 7.5% 2023 senior notes, which it completed at the end of last month.
NGL Energy also stated it was pursuing other ways to generate cash, including noncore asset sales, to pay down additional debt. The MLP delivered on that objective last month. It agreed to sell its marine assets via two transactions for $111.65 million. CEO Mike Krimbill commented on the sale in a press release. He stated: "This non-core asset sale should allow NGL to further reduce leverage by March 31, 2023, as these proceeds will be used for debt reduction. Our near-term focus continues to be reducing absolute debt and leverage."
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Why Units of NGL Energy Partners Slumped More Than 15% in March