Aris Water Solutions(US:ARIS)2025-05-07 16:56Financial Performance - Total revenue for Q1 2025 was $120.5 million, a 17% increase compared to Q1 2024[115] - Net income for Q1 2025 was $16.0 million, a 5% decrease compared to Q1 2024[115] - Adjusted EBITDA for Q1 2025 was $56.5 million, a 6% increase compared to Q1 2024[115] - Produced water handling revenues increased to $92.178 million in Q1 2025, up from $85.933 million in Q1 2024[132] - Total Revenue for the Water Gathering and Processing segment in Q1 2025 was $120.3 million, up from $103.4 million in Q1 2024[159] - Adjusted EBITDA for Q1 2025 was $56.5 million, compared to $53.1 million in Q1 2024[159] Production and Operations - Total produced water handling volumes were 1,191 thousand barrels per day, a 3% increase compared to Q1 2024[122] - Total water solutions volumes sold were 559 thousand barrels per day, a 54% increase compared to Q1 2024[122] - Skim oil volumes recovered increased by 13% to 1,962 barrels per day in Q1 2025 compared to Q1 2024[130] Costs and Expenses - Direct operating costs per barrel increased by 10% to $0.32 compared to Q1 2024[122] - Direct operating costs increased by $10.5 million in Q1 2025 compared to Q1 2024, driven by higher produced water handling and solutions volumes[135] - General and administrative expenses rose by $5.5 million in Q1 2025, primarily due to increased compensation and benefits[147] Acquisitions and Investments - The company completed the Crosstek Acquisition for a total consideration of $2.9 million to expand into broader industrial markets[115] - The company acquired Crosstek Membrane Technology LLC for $2.9 million to enhance its capabilities in industrial water treatment[139] - Net cash used in investing activities for Q1 2025 totaled $22.3 million, an increase from $19.6 million in Q1 2024, primarily due to $2.0 million paid for the Crosstek Acquisition[167] Cash Flow and Financing - For Q1 2025, net cash used in operating activities was $6.8 million, a decrease of $50.6 million compared to $43.8 million provided in Q1 2024[166] - Net cash provided by financing activities for Q1 2025 was $25.0 million, including the issuance of $500.0 million in 2030 Notes[168] - As of March 31, 2025, the average outstanding debt balance increased to $463 million in Q1 2025 from $426 million in Q1 2024[150] - As of March 31, 2025, there were no outstanding borrowings under the Credit Facility, as the company used proceeds from the 2030 Notes to repay it[176] Future Outlook and Commitments - Capital expenditures are expected to be between $85.0 million to $105.0 million for 2025, based on contracted customers' outlooks[170] - The company aims to complete Phase 1 testing of its beneficial reuse technologies by the end of Q2 2025[145] - As of March 31, 2025, the remaining minimum commitment under the water disposal agreement was $19.9 million, undiscounted[163] Market and Risk Factors - The average WTI crude oil spot price was $71.78 in Q1 2025, down from $77.50 in Q1 2024[119] - The company does not currently hedge its exposure to commodity price risk, which is influenced by fluctuations in crude oil prices[175] - The company’s revenue is indirectly exposed to fluctuations in crude oil and natural gas prices, impacting drilling and completion activity levels[173] Shareholder Returns - The company declared a dividend of $0.14 per share for both Q1 and Q2 2025 on its Class A common stock[164][165] Research and Development - Research and development expenses related to the Joint Industry Project (JIP) were $2.2 million in Q1 2025, slightly down from $2.6 million in Q1 2024[148] Company Classification - The company is classified as an "emerging growth company" and may take advantage of certain exemptions from reporting requirements until it no longer qualifies[171]