Financial Data and Key Metrics Changes - Pro forma revenue for Q3 2025 increased to $205.5 million, up 8% compared to the previous quarter, driven mainly by increased volumes and rates [16] - Combined produced water handling volumes for the quarter were 2.5 million barrels per day, representing quarter-over-quarter growth of 7% [16] - Pro forma net loss was $18.7 million for the third quarter, with pro forma adjusted EBITDA of $105.7 million and an adjusted EBITDA margin of 51% [16][18] Business Line Data and Key Metrics Changes - Produced water handling comprises approximately 90% of the company's revenue, derived from fixed-fee contracts for transportation, treatment, handling, and disposal [8] - The water solutions business, including fees from sales of brackish water and waste management, contributes the remainder of the revenue [9] Market Data and Key Metrics Changes - The company operates primarily in the Delaware Basin, the most prolific oil and natural gas basin in North America, with a network of approximately 2,500 miles of pipeline and nearly 200 produced water handling facilities [6][8] - The demand for water handling services is expected to grow significantly, particularly in New Mexico, as recycling capacity declines and produced water volumes increase [25] Company Strategy and Development Direction - WaterBridge aims to capitalize on its strong balance sheet and proven business strategy to meet the growing needs of customers in the water infrastructure sector [5] - The company is focused on expanding its infrastructure network and commercial relationships while maintaining a conservative balance sheet [18] - WaterBridge is exploring opportunities to serve a wider range of industries, including data center cooling and beneficial reuse of produced water [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver growth despite macroeconomic volatility, citing long-term contracts and minimum volume commitments as key factors [24] - The company anticipates providing 2026 guidance during the fourth quarter and full year 2025 earnings call [18] Other Important Information - The company completed a successful IPO in September 2025, raising approximately $673 million to strengthen its balance sheet [16] - WaterBridge has secured significant access to pore space through partnerships with LandBridge and Texas Pacific Land, which supports future growth in produced water handling capacity [10] Q&A Session Summary Question: Demand for Speedway Pipeline project - Management noted strong demand for the Speedway Pipeline project, with the potential to add an additional 500,000 barrels per day capacity [21][22] Question: Macro backdrop and growth expectations - Management indicated that the company is well-insulated from broader market volatility, with growth underpinned by minimum volume commitments [24] Question: Competitive landscape and customer discussions - Management highlighted strong traction with producers, emphasizing the importance of partnerships with experienced operators and access to differentiated pore space [30] Question: Contract rate outlook - Management reported meaningful increases in rates for recent deals, reflecting the value of premium flow assurance [31] Question: Regulatory reforms in Texas - Management expressed confidence in their relationship with the Railroad Commission and noted that recent regulatory changes have not negatively impacted the company [40][41] Question: Data center opportunity - Management acknowledged the potential for significant demand from data centers and the company's advantageous position due to its infrastructure and expertise [45][46]
WaterBridge Infrastructure LLC(WBI) - 2025 Q3 - Earnings Call Transcript