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- **Water Infrastructure Dominance**: 10% Q4 and >20% 2026 growth driven by 800,000+ new acres under contract and 1M barrels/day recycling capacity.
- **Chemical Tech Breakout**: 13% revenue growth, 19.9% margins, and 29% gross profit increase from new product adoption.
- **Lithium Royalty Stream**: $2.5M/year in 2027, scaling to $5M/year, leveraging 1.3M barrels/day of produced water infrastructure.
- **Financial Resilience**: $60M Q3 EBITDA, $72M operating cash flow, and strong balance sheet with $250M-$275M 2025 CapEx.
- **Strategic Differentiation**: Unique recycling-first model with dual-pipeline networks, enabling 80%+ Permian volumes recycled vs. peers.

**【CEO Summary Section】**
- **Water Infrastructure Growth**: Q3 revenue decreased 2.5% but maintained 53% gross margins. Expect 10% Q4 growth and >20% 2026 growth driven by 800,000+ new acres under dedication and 65,000+ new acres in the Permian Basin.
- **Chemical Technologies Success**: 13% sequential revenue growth, 19.9% gross margins, and 29% gross profit increase. New product development driving market share gains.
- **Lithium Extraction Partnership**: Texas' first commercial produced water lithium extraction facility with Mariana Minerals, generating $2.5M/year in 2027, ramping to $5M/year at full capacity.
- **Recycling First Strategy**: Recycling 1M barrels/day in the Permian, reducing costs for customers and providing synthetic disposal capacity.
- **Disposal Network Expansion**: Adding disposal capacity to complement recycling, with dual-pipeline systems in the Delaware Basin for flexibility.

**【CFO Financial Commentary】**
- **Consolidated Results**: Adjusted EBITDA of $60M in Q3, up $19M in operating cash flow, and $72M cash flow from operations.
- **Segment Performance**: 
  - **Water Infrastructure**: 53% gross margins, 10% Q4 growth guidance.
  - **Water Services**: 18% gross margins (below target), 23% sequential revenue decline due to divestments.
  - **Chemical Technologies**: 19.9% gross margins, 13% revenue growth.
- **Capital Allocation**: $250M-$275M 2025 CapEx (up $25M), with $95M Q3 growth CapEx for infrastructure projects.
- **Liquidity**: Strong balance sheet with $50M-$60M annual maintenance CapEx.

**【Q&A Key Highlights】**
- **Disposal vs. Recycling**: 80%+ of Permian volumes recycled, with disposal as a backstop. Stranded asset acquisitions enhance network flexibility.
- **Mineral Extraction Potential**: 1.3M barrels/day of produced water moving through infrastructure, targeting $10M-$15M annual royalty revenue by 2030.
- **Chemical Tech Growth**: New products addressing efficiency needs (e.g., extended lateral wellbores), driving 29% gross profit growth.
- **Peak Power Strategy**: Evaluating distributed power and battery storage opportunities, aiming for a distinct growth path separate from water infrastructure.
- **Competitive Position**: Leading market share in Delaware Basin with dual-pipeline systems, enabling 2-way water movement and optionality.
- **Haynesville Outlook**: Strong demand for disposal services, with potential for new infrastructure projects as gas drilling resumes.


Select Water Solutions, Inc. (WTTR) 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

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Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

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Operating Income

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Net Income

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Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

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Diluted EPS from Discontinued Operations

WTTR

WTTR fundamentals

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