Financial Data and Key Metrics Changes - Adjusted EBITDA from continuing operations for the quarter was $172.5 million, up from $158 million a year ago, representing a 9.2% increase [2] - Operating expenses for the quarter were $0.18 per barrel due to non-recurring expense reductions [6] - Full-year EBITDA guidance remains in the range of $650 million to $660 million [4] Business Line Data and Key Metrics Changes - Water Solutions segment generated Adjusted EBITDA of $154.5 million, an increase of 16.5% from $132.7 million in the prior year [5] - Physical disposal volume reached a record of approximately 3.07 million barrels per day, up 17.1% from 2.6 million barrels per day in the prior year [5] - Crude Oil Logistics Adjusted EBITDA was $15.4 million, down from $17.3 million in the prior year's third quarter [6] - Liquids Logistics Adjusted EBITDA was $15.2 million, compared to $18.6 million in the prior year's third quarter [7] Market Data and Key Metrics Changes - The company processed roughly 3.5 million barrels per day of disposal volumes, a record for the partnership [3] - The average physical volumes on the Grand Mesa Pipeline increased to approximately 85,000 barrels per day, up from 61,000 barrels per day in the prior year [6] Company Strategy and Development Direction - The company is transitioning towards a predominantly water solutions company, shedding non-water assets to improve cash flow consistency [12] - Capital allocation priorities include financing internal growth projects, redeeming Class D preferred units, and opportunistically repurchasing common units [13] - The company is pursuing large-scale produced water treatment strategies, including a partnership with Natura Resources for thermal desalination technology [10][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the stability of growth projects despite crude price volatility, noting that long-term volume commitments remain firm [18] - The company anticipates a strong start to fiscal 2027, projecting to exceed $700 million of EBITDA for the first time [5] - Management highlighted the importance of AI and machine learning in improving operational efficiencies and reducing expenses [10][26] Other Important Information - The company redeemed an additional 18,506 Class D Preferred Units, totaling 88,506, or about 15% of the original Class D outstanding [3] - The company has repurchased approximately 8.7 million common units since the program's inception, nearly 7% of the outstanding units [3] Q&A Session Summary Question: Can you speak to the firmness of the growth projects given the volatility in crude prices? - Management indicated that completed projects came with long-term volume commitments, which remain financially firm despite fluctuations in oil prices [18] Question: How would you characterize the water treatment opportunity in volume and values? - Management emphasized the importance of produced water volumes and available energy sources for economic-scale projects, highlighting the potential of the partnership with Natura [22] Question: What is the current CapEx obligation for the water treatment project? - Management clarified that there would be no CapEx demand from NGL on the nuclear side, and the CapEx forecast remains unchanged [23] Question: Can you discuss the value recovered from the AI and machine learning initiatives? - Management noted improvements in operational expenses and efficiencies but refrained from quantifying the exact dollar amount or percentage of value recovered at this time [26]

Crude Oil Logistics 84% 8% 8% $15.36MM Investor Presentation February 2026 NYSE: NGL Company Overview Water Solutions 84% 8% 8% $15.20MM 1. EBITDA values reflect Q3 Fiscal 2026 and does not include corporate or discontinued operations 2 84% 8% 8% Logistics NGL Total EBITDA by Segment $185.06 MM(1) $154.50 MM ▪ Provides water transportation, treating, recycling, and handling services for upstream customers ▪ Largest integrated water solutions network of injection wells and large diameter pipe in the Delaware ...

Core Insights - The investment landscape in 2025 has been shaped by various factors including China's AI initiatives, pressures on U.S. Big Tech, tariffs from the Trump era, persistent inflation, and high interest rates, leading to a volatile market environment [1] - Retail investors are advised to focus on sales growth as a more reliable metric for stock evaluation compared to earnings, with specific companies highlighted as potential investment opportunities [2][3] Market Conditions - The year began with optimism but faced volatility due to external pressures, particularly in April, before stabilizing in May and improving mid-year as trade tensions eased [1] - The Federal Reserve implemented three rate cuts starting in September, but market momentum weakened in the fourth quarter due to a prolonged U.S. government shutdown and concerns over AI sector overvaluation [1] Investment Strategy - Sales growth is emphasized as a key indicator of a company's momentum, reflecting real demand and potential for future earnings upside [3] - Sustained sales growth supports cash flow stability, allowing companies to reinvest and maintain financial strength without excessive debt [4] Stock Selection Criteria - Stocks were screened based on criteria including 5-Year Historical Sales Growth greater than industry average and Cash Flow exceeding $500 million [5] - Additional metrics for stock selection include a Price-to-Sales (P/S) ratio lower than the industry average, positive sales estimate revisions, operating margins above 5%, and Return on Equity (ROE) greater than 5% [6][7][8] Highlighted Stocks - Agnico Eagle Mines Limited (AEM) is a gold producer with expected sales growth of 38.6% for 2025 and holds a Zacks Rank 1 [10] - EnerSys (ENS) is projected to have a sales growth rate of 4% for fiscal 2026 and carries a Zacks Rank 2 [11] - CACI International Inc (CACI) anticipates an 8.5% sales increase for fiscal 2026, also with a Zacks Rank 2 [12] - Rockwell Automation, Inc. (ROK) expects a sales growth of 5.8% for fiscal 2026 and holds a Zacks Rank 2 [13] - Xylem Inc. (XYL) is projected to grow sales by 5.2% in 2025 and carries a Zacks Rank 2 [14]

Core Insights - Pentair is positioned as a pure-play water company focused on moving, improving, and enjoying water through three main segments: Flow, Water Solutions, and Pool business [2][3] - The company has been on a transformation journey, successfully expanding its return on sales over several years and anticipates an inflection point leading to top-line growth starting in 2026 [3] Segment Overview - The Flow business is categorized under the "move" segment, while the "improve" segment, known as Water Solutions, is composed of one-third residential and two-thirds commercial operations [2] - The "enjoy" segment, primarily represented by the Pool business, tends to receive the most attention and visibility [2]

Core Insights - The markets started 2025 strong but have faced increased volatility due to the Trump administration's tariff plans and geopolitical uncertainties, leading to cautious investor behavior [1] Stock Selection Strategy - A conventional method for selecting stocks is focusing on those with steady sales growth, with The Walt Disney Company (DIS), Agnico Eagle Mines Limited (AEM), Adobe Inc. (ADBE), and Xylem Inc. (XYL) highlighted as potential candidates [2][10] - Revenue growth is prioritized over earnings as it indicates an expanding customer base and long-term potential, while stagnant revenue may signal operational challenges [3] - An effective investment strategy should also analyze a company's cash position alongside sales, as strong cash reserves and healthy cash flow provide flexibility for growth and stability [4] Screening Parameters - Stocks are shortlisted based on criteria including 5-Year Historical Sales Growth (%) greater than the industry average and Cash Flow exceeding $500 million [5] - Additional metrics include a Price-to-Sales (P/S) Ratio lower than the industry average, positive % Change in F1 Sales Estimate Revisions, Operating Margin greater than 5%, Return on Equity (ROE) above 5%, and a Zacks Rank of 1 or 2 [6][7][8] Company Highlights - The Walt Disney Company (DIS) has a projected sales growth rate of 4.1% for 2025 and currently holds a Zacks Rank of 2 [11] - Agnico Eagle Mines (AEM) is expected to see a sales growth rate of 24.6% in 2025 and has a Zacks Rank of 1 [12] - Adobe Inc. (ADBE) anticipates a sales increase of 9.5% for fiscal 2025 and holds a Zacks Rank of 2 [12] - Xylem Inc. (XYL) has a projected sales growth of 2.2% for 2025 and also carries a Zacks Rank of 2 [13]

Financial Data and Key Metrics Changes - Consolidated adjusted EBITDA from continuing operations for Q4 was $176.8 million, up approximately 20% from $147.9 million in the prior year [6] - Full year adjusted EBITDA from continuing operations was $622.9 million, exceeding previous guidance of $620 million [7] Business Line Data and Key Metrics Changes - Water Solutions adjusted EBITDA for Q4 was $154.9 million, compared to $123.4 million in the prior year [7] - Physical water disposal volumes increased to 2.73 million barrels per day in Q4 from 2.39 million barrels per day in the prior year [8] - Crude Oil Logistics adjusted EBITDA decreased to $13.1 million in Q4 from $15.3 million in the prior year, primarily due to lower volumes on the Grand Mesa pipeline [10][11] - Liquids Logistics adjusted EBITDA was $17.7 million in Q4, down from $22.2 million in the prior year [12] Market Data and Key Metrics Changes - Total volumes paid for disposal increased by 11% in Q4 compared to the same quarter of the previous year [8] - Operating cost per barrel for fiscal 2025 was $0.22, down from $0.24 in fiscal 2024 [9] Company Strategy and Development Direction - The company is focusing on core assets after divesting non-core businesses, which will reduce volatility and seasonality of adjusted EBITDA [5] - Plans to continue reducing leverage and improve capital structure by addressing Class D Preferred Units [6][19] - The company aims to generate approximately 85% of adjusted EBITDA from the Water Solutions segment moving forward [16] Management's Comments on Operating Environment and Future Outlook - Management noted that despite oil price uncertainty, there has been no drop-off in customer activity in the Corita Basin [10] - The company is well-positioned with 90% of volumes committed through acreage dedications and MVCs, with 80% of total volumes from investment-grade counterparties [10] - Future growth is expected in the Water Solutions segment, with guidance for fiscal 2026 adjusted EBITDA between $615 million and $625 million [12] Other Important Information - The company completed the sale of 18 natural gas liquids terminals and other non-core assets, raising $270 million [4][16] - The biodiesel business has been fully wound down, eliminating approximately $75 million of working capital [5] Q&A Session Summary Question: Can you offer more color on your expectations by business for 2026 guidance? - Management explained that the water guidance midpoint implies about $560 million, accounting for a $20 million decline in skim oil revenues due to lower crude prices [21][22] Question: What are the conversations with customers regarding growth opportunities? - Management indicated that they are recontracting and focusing on core customers, with no slowdown in volumes currently observed [27][29] Question: How much lower could you flex capital spending down? - Management stated that capital expenditures are already low and further reductions may not be significant [35][37] Question: How do you think about your low and high range on volumes for the water business? - Management noted that fluctuations in volumes are normal, with a strong base wedge of business and no significant changes expected from customers [40][46] Question: Will there be a reinstatement of common unit distributions? - Management clarified that there are no plans for near-term distributions as the focus is on reducing Class D preferred units [52][54]