Financial Data and Key Metrics Changes - In 2024, Select Energy Services, Inc. achieved record consolidated revenue of $1.5 billion, with a gross margin of 53% in the water infrastructure segment, $258 million in adjusted EBITDA, $235 million in cash flow from operating activities, and $78 million in free cash flow [35][36][44] - The company reported a 26% annual revenue growth and a 62% increase in annual gross profit from the water infrastructure segment [11][12] Business Line Data and Key Metrics Changes - The water infrastructure segment saw significant growth, with a gross profit increase of 62% and a revenue growth expectation of 15% to 25% for 2025 [21][44] - The water services segment experienced a revenue decline of about 10% in Q4, but is expected to recover with low to mid-single-digit percentage revenue increases in Q1 2025 [48][49] - The chemical technologies segment reported a 14% sequential revenue growth in Q4, driven by new product development and market share gains [50] Market Data and Key Metrics Changes - The company has over 2.5 million acres under long-term area dedication, with a significant backlog of future well inventory and produced water volumes [15][42] - Demand for water recycling is increasing, with the company setting a new five-year target to recycle over 400 million barrels of produced water annually by 2029 [39] Company Strategy and Development Direction - The company is focusing on expanding its water infrastructure platform into the municipal, industrial, and agricultural water markets, with a $62 million investment in Colorado [27][30] - Select aims to enhance its capital structure to support significant growth opportunities while maintaining a conservative balance sheet [38][56] Management's Comments on Operating Environment and Future Outlook - Management expects a steady commodity price environment for oil and natural gas in 2025, with a modest reduction in US lower 48 activity levels compared to 2024 [22] - The company anticipates stronger year-over-year adjusted EBITDA growth in 2025, driven primarily by the water infrastructure segment [25][56] Other Important Information - The company has executed nearly a dozen small bolt-on infrastructure acquisitions and increased its base dividend by 17% during the year [12][36] - Select has a disciplined approach to leverage, maintaining a net debt to EBITDA leverage ratio substantially below one times [38] Q&A Session Summary Question: Can you discuss the new venture in Colorado and its return profile? - Management highlighted that the Colorado venture offers high gross margin-related revenue with contracts that could last up to 50 years, providing predictable and repeatable income [70][72] Question: How does the Colorado opportunity compare to traditional recycling projects? - The Colorado opportunity is seen as a resource development opportunity with higher margins than traditional water projects, although it requires a larger upfront investment [73][74] Question: What is the expected revenue growth trajectory for the water infrastructure segment? - Management indicated that the water infrastructure segment is expected to see a strong second half of 2025, with double-digit percentage growth anticipated in Q2 and Q3 [47][81] Question: Will the company maintain its gross margin levels in the upcoming quarters? - Management expressed confidence in maintaining gross margins in the 50% to 60% range, despite some initial operational efficiency challenges with new assets [84][86]

Oil and Gas Production - The U.S. shale oil production has increased from approximately 500,000 barrels per day in 2010 to about 9 million barrels per day currently, accounting for around 9% of the total global oil supply[34] - U.S. shale gas production has risen from about 15 billion cubic feet per day in 2010 to approximately 85 billion cubic feet per day as of December 2024, representing nearly 80% of U.S. natural gas production[34] Water Management and Recycling - The completion of a typical horizontal well now requires over 750,000 barrels of water, compared to roughly 75,000 barrels in 2010[37] - Current multi-well pad development plans can require in excess of five million barrels of water to complete all wells on the pad[37] - The company is actively expanding its portfolio of water recycling facilities, emphasizing water recycling as a cornerstone of its operations[30] - The company has significantly increased its focus on recycling and reuse of produced water to meet industry demand and reduce fresh water usage[51] - The company aims to enhance its water infrastructure capabilities through recent acquisitions and new recycling and pipeline projects[48] - The Water Infrastructure segment has a combined daily throughput capacity of approximately 3.2 million barrels per day for active produced water recycling and 21 million barrels of produced water storage[69] - The Water Sourcing service line has secured rights to approximately two billion barrels of water annually from hundreds of strategically located sources across the U.S.[82] - The company operates the largest high-capacity aboveground water storage tanks (ASTs) in the U.S., with sizes ranging from 4,500 to 82,000 barrels[83] - The company has developed over 1,000 miles of temporary and permanent pipeline infrastructure across key regions, including the Permian Basin and Bakken Shale[72] Financial Performance and Acquisitions - In 2024, the company executed strategic acquisitions totaling approximately $163 million, including the Tri-State Acquisition for $58.3 million and the Trinity Acquisition for $30.8 million[44] - The company has $85.0 million in outstanding borrowings and $114.8 million of available borrowing capacity under its Prior Sustainability-Linked Credit Facility as of December 31, 2024[387] - As of February 17, 2025, the company had $250.0 million in outstanding indebtedness and $211.3 million of available borrowing capacity under its Sustainability-Linked Credit Facility[387] Environmental and Regulatory Compliance - The company is subject to various environmental regulations that could increase operational costs and limit operational capabilities[140] - The company is subject to regulations regarding the handling and management of Naturally Occurring Radioactive Materials (NORM), which may be present in oilfield wastes[110] - Under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), the company may face strict liability for costs associated with hazardous substance releases, including cleanup and damages[111] - The Clean Water Act (CWA) imposes strict controls on pollutant discharges, requiring permits from the EPA, which could lead to increased compliance costs and project delays[113] - The Oil Pollution Act of 1990 establishes liability for oil spill cleanup costs, with a current limit of $137.7 million for economic damages, unless gross negligence is proven[116] - The Underground Injection Control (UIC) program regulates saltwater disposal wells, and any leakage could result in significant remediation costs and permit suspensions[117] - Recent investigations into induced seismicity linked to wastewater disposal may lead to stricter regulations and operational restrictions in certain states[118] - Hydraulic fracturing is facing increased scrutiny and potential regulatory changes, which could impose additional costs and operational delays for the company and its customers[121] - New regulations on methane emissions finalized by the EPA in December 2023 require states to implement stringent controls, potentially impacting operational costs and compliance[128] - The IRA 2022 establishes a federal fee on methane emissions starting at $900 per ton in 2024, increasing to $1,500 by 2026[129] - Colorado's Energy and Carbon Management Commission adopted rules in January 2024 to scrutinize GHG emissions and set intensity targets for oil and gas operators[131] - President Biden announced a 50-52% reduction in GHG emissions from 2005 levels by 2030, with the U.S. rejoining the Paris Agreement uncertain[132] Operational Efficiency and Technology - The company’s Water Services segment utilizes patented WaterONE™ automation services and AquaView® software for 24/7 monitoring of water-related operations, improving efficiency and safety[32] - The company’s proprietary automation technologies improve efficiency and decrease costs for customers by providing integrated water transfer solutions[83] - The company’s logistics solutions can eliminate approximately 38,500 tank truck loads for a multi-well pad requiring five million barrels of water, significantly reducing costs and environmental footprint[38] - The company’s solid waste management facilities include a 50-acre landfill in North Dakota with more than five million cubic yards of permitted capacity[73] - The company is actively developing and deploying electric pumping units to decrease emissions and reduce the environmental impact of its operations[81] Human Capital and Safety - The company has over 3,700 employees as of December 31, 2024, focusing on human capital management and employee retention[54] - The company emphasizes a strong safety culture, with a Safety Recognition Program that has improved workplace safety and employee morale[53] - The company is committed to promoting human rights and social responsibility, ensuring respect for all individuals without discrimination[61] Market Conditions and Risks - The company faces risks related to capital spending reductions in the oil and gas industry, which could adversely affect liquidity and financial condition[23] - The demand for oilfield services is largely dependent on the level of drilling and completion activity in the U.S. oil and gas industry, influenced by various uncontrollable factors[384] - Sustained low oil and gas prices could lead to lower capital spending and reduced drilling and completion activity, adversely affecting the company's business and financial condition[386] - Litigation risks are increasing against oil and gas companies for contributing to climate change, alleging public nuisances and investor fraud[133] - Access to capital for fossil fuel producers may be restricted due to climate change policies, with institutional investors favoring clean energy[134] - The SEC has finalized a rule requiring climate-related disclosures, but its implementation is currently paused pending litigation[135] Liability and Indemnification - The company assumes responsibility for pollution or contamination from its equipment, while customers generally assume responsibility for other pollution during operations[153] - The company may incur substantial losses that could materially and adversely affect its financial condition due to unforeseen liabilities not addressed by contractual provisions[154] - The company does not currently have or intend to enter into any derivative arrangements to protect against fluctuations in interest rates applicable to its outstanding indebtedness[387] - The company’s MSAs delineate indemnification obligations, with mutual indemnification for personal injury or property loss, except in cases of gross negligence or willful misconduct[153] - The company is exposed to additional liability if it is grossly negligent or commits willful acts causing pollution or contamination[153] - Losses from catastrophic events, such as blowouts, are generally the responsibility of the customer[153]

Core Insights - Select Water Solutions and Occidental have made significant progress in reducing freshwater usage through the Lost Tank recycling facility, which has recycled over 50 million barrels of produced water [1][2][4] Group 1: Facility Operations and Capacity - The Lost Tank facility began operations in 2022 with an initial recycling capacity of 60,000 barrels per day, which has now expanded to 180,000 barrels per day, supported by 1.9 million barrels of storage [2] - The facility has successfully recycled over 50 million barrels of produced water, contributing to reduced environmental impact and addressing regional water management needs [2] Group 2: Infrastructure Development - A 13-mile produced water pipeline was constructed to connect the Lost Tank facility to Occidental's Mesa Verde assets, enhancing water recycling and reuse capabilities [3] - The network is expected to expand further by 2025, with plans to increase pipeline connectivity and integrate the facility into a broader system with a total storage capacity of 12 million barrels [3] Group 3: Commitment to Sustainability - The facility reflects the commitment of both companies to sustainability and innovation, aiming to reduce freshwater dependence and disposal volumes in the Delaware Basin [4] - Select Water Solutions emphasizes the importance of environmentally responsible water management throughout the lifecycle of a well [5]

GAINESVILLE, Texas, Feb. 10, 2025 /PRNewswire/ -- Select Water Solutions, Inc. (NYSE: WTTR) today announced that it will release 2024 fourth quarter and full year financial results on Tuesday, February 18, 2025 after the market closes. In conjunction with the release, the Company has scheduled a conference call, which will also be broadcast live over the Internet, on Wednesday, February 19, 2025 at 11:00 a.m. Eastern Time (10:00 a.m. Central Time).What:    Select Water Solutions 2024 Fourth Quarter and Full ...

Board Changes - Troy W Thacker will retire from Select Water Solutions' Board of Directors after nearly five years of service, with no disagreement with the company [1] - Bruce E Cope and Timothy A Roberts were appointed to the Board, bringing strong accounting, finance, and operational expertise in the oil and gas industry [1][4] New Board Member Profiles - Bruce E Cope has over 30 years of experience in the oil and gas industry, including roles as Senior Vice President at Hunt Consolidated and accounting positions at KPMG and Pacific Enterprises Oil Company USA [2] - Timothy A Roberts has over 20 years of experience in the oil and gas midstream sector, currently serving as CEO of Iron Horse Midstream and previously as CFO of Cardinal Midstream II [3] Company Strategy and Outlook - Select Water Solutions aims to advance midstream partnerships with E&P customers, optimize its business, and deliver market-leading water solutions as part of its Water Infrastructure growth strategy [4] - The company emphasizes sustainable water and technology solutions, supported by critical water infrastructure assets, chemical manufacturing, and water treatment capabilities [5] Industry Context - The company operates in the energy industry, providing water and chemical solutions with a focus on environmentally responsible water management throughout the well lifecycle [5]

GAINESVILLE, Texas, Jan. 28, 2025 /PRNewswire/ -- Select Water Solutions, Inc. (NYSE: WTTR) ("Select" or the "Company"), a leading provider of sustainable water and technology solutions to the energy industry, today announced the successful closing of a new five-year senior secured sustainability-linked credit facility ("Credit Facility"). The Credit Facility includes an initial $300 million revolving credit commitment ("Revolver") and $250 million in term loan commitments ("Term Loan"). Both the Revolver a ...

GAINESVILLE, Texas, Jan. 23, 2025 /PRNewswire/ -- Select Water Solutions, Inc. (NYSE: WTTR) ("Select" or the "Company"), a leading provider of sustainable water and chemical solutions to the energy industry, today announced that its Board of Directors declared a quarterly cash dividend of $0.07 per share of Class A common stock to be paid on February 14, 2025, to holders of record as of the close of business on February 4, 2025. A comparable distribution of $0.07 per unit has also been approved to the unith ...

Financial Data and Key Metrics Changes - The company achieved a net income growth of 26% compared to the second quarter of 2024, with revenues growing by 40% year-over-year and gross profit before depreciation and amortization (D&A) increasing by 99% compared to Q3 2023 [9][30][43] - Consolidated adjusted EBITDA for Q3 2024 was $73 million, exceeding guidance of $66 million to $70 million, while the fourth quarter is expected to see adjusted EBITDA between $60 million to $62 million [43][44] Business Line Data and Key Metrics Changes - Water Infrastructure segment revenues grew by 20% compared to Q2 2024, with gross profit before D&A increasing by 33% [9][30] - Water Services segment revenues increased by approximately 2% despite a modest decline in overall completions activity, while margins are expected to hold steady at 20% to 21% in Q4 [38][39] - Chemical Technologies segment experienced a revenue decline due to decreased activity with legacy pressure pumping customers, but is expected to recover in Q4 with revenue growth in the mid-single digits and margins improving to 14% to 16% [40][41] Market Data and Key Metrics Changes - The company added 25,000 acres under long-term dedication in the Permian Basin and executed two new pipeline connection agreements in the Bakken, enhancing its market footprint [11][12] - The company anticipates a seasonal activity slowdown in Q4, particularly impacting the Water Services segment, while expecting revenue and margin recovery in the Chemical Technologies segment [18][39] Company Strategy and Development Direction - The company aims to continue growing its production base and long-term contracted revenue within the Water Infrastructure segment, with a focus on operational improvements and strategic acquisitions [22][36] - The company is positioned to capitalize on industry trends towards increased recycling and complex full life cycle solutions, supporting continued growth opportunities [23][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving record-setting annual adjusted EBITDA and noted that the business development backlog is increasing in size and certainty [15][14] - The company expects strong margins to continue, with a rebound in activity anticipated in Q1 2025 as new projects come online [20][37] Other Important Information - The company reduced SG&A expenses by more than 4% or $1.7 million relative to Q2 2024, maintaining a conservative balance sheet with $80 million of outstanding borrowings [42][46] - A 17% increase in the quarterly dividend payment to $0.07 per share was announced, with total capital return to shareholders expected to be about $40 million during 2024 [49][50] Q&A Session Summary Question: Future margin trajectory in Water Infrastructure - Management indicated that margins in the Water Infrastructure segment are expected to remain in the 50% to 60% range, with opportunities for further improvement through increased asset utilization and strategic contracts [58][62] Question: Impact of operational downtime on Q4 EBITDA - Management clarified that over half of the expected decline in Q4 EBITDA is attributed to planned operational downtime at specific facilities, with some seasonal impacts also expected [71][72] Question: New product wins in Chemical Technologies - Management noted that new product wins are occurring across various regions, particularly in the Permian Basin, and are expected to be repeatable going forward [74] Question: Expected outcomes for the New Mexico recycling plant transition - Management explained that the transition to an integrated system will enhance utilization across facilities, allowing for better water management and increased efficiency [78][79] Question: Long-term contracts and water balancing capability - Management confirmed that long-term contracts are being secured due to the company's water balancing capabilities, providing certainty for operators [101][102] Question: Regulatory environment impact - Management stated that the current regulatory environment is supportive of the industry, with a focus on managing produced water waste streams [110][112]

Select Water Solutions, Inc. (WTTR) reported $371.35 million in revenue for the quarter ended September 2024, representing a year-over-year decline of 4.6%. EPS of $0.15 for the same period compares to $0.14 a year ago.The reported revenue represents a surprise of +5.97% over the Zacks Consensus Estimate of $350.43 million. With the consensus EPS estimate being $0.14, the EPS surprise was +7.14%.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expe ...

Select Water Solutions, Inc. (WTTR) came out with quarterly earnings of $0.15 per share, beating the Zacks Consensus Estimate of $0.14 per share. This compares to earnings of $0.14 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 7.14%. A quarter ago, it was expected that this company would post earnings of $0.11 per share when it actually produced earnings of $0.13, delivering a surprise of 18.18%.Over the last four quarters, ...