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- **Record Q3 Performance:** Adjusted EBITDA of $634 million, driven by cost reductions and operational efficiency.
- **Aris Synergies:** $40 million annual target, with 2.5 months of contribution in Q4.
- **Pipeline Optimization:** Pathfinder disposal capacity expansion enhances returns.
- **Cost Savings:** O&M down 5% Q/Q, with more savings expected.
- **2026 Growth:** Delaware Basin leads with 40% produced water growth, while PRB and DJ Basin face commodity headwinds.
- **Financial Strength:** 3x leverage supports projects, with free cash flow above $1.475 billion.

**【CEO Opening Remarks】**
- Q3 2025 marked a record quarter with adjusted EBITDA of $634 million, driven by cost reduction initiatives and operational efficiency.
- The Aris Water Solutions acquisition solidified WES as a leader in produced water midstream services, with $40 million annual synergy target.
- Secured additional disposal capacity for the Pathfinder pipeline, enhancing project returns and optimizing route efficiency.
- Delaware Basin throughput set a new record, despite fewer wells coming online, while DJ Basin throughput growth was supported by early well onloads.

**【COO Operational Update】**
- Natural gas throughput increased 2% Q/Q, driven by Chipeta plant volumes and DJ Basin activity.
- Crude oil and NGLs throughput decreased 4% Q/Q but expected to rebound in Q4.
- Produced water throughput remained flat, with 2.5 months of Aris contribution in Q4.
- Per Mcf gross margin for natural gas decreased $0.05 Q/Q, while crude oil/NGLs margin increased $0.08.
- 2026 projections: mid-single-digit natural gas growth, low-single-digit crude/NGLs growth, and 40% produced water growth YoY.

**【CFO Financial Update】**
- Q3 net income of $332 million and free cash flow of $397 million, with a $0.91 per unit distribution.
- O&M expenses down 5% Q/Q to $12 million, with cost initiatives expected to sustain savings.
- 2025 adjusted EBITDA guidance revised to high end of $2.35-2.55 billion, with free cash flow above $1.475 billion.
- 2025 capex near high end of $625-775 million, with 2026 capex projected at least $1.1 billion.
- Leverage expected to remain near 3x, supporting growth and flexibility.

**【Q&A Highlights】**
- **Cost Management:** O&M savings sustainable, with further reductions through maintenance rationalization and supply chain optimization.
- **Distribution Growth:** Targeting mid-single-digit growth, with potential increases tied to major projects or M&A.
- **Pathfinder Pipeline:** Additional pore space enhances returns, with contracting progressing post-Aris integration.
- **New Mexico Expansion:** Focus on organic growth leveraging Aris's footprint, with sour gas challenges manageable.
- **2026 Outlook:** Delaware Basin growth offset by cautious PRB and DJ Basin activity due to commodity price weakness.

Western Midstream Partners, LP Common Units (WES) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

WES

WES fundamentals

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