Q2 2024 Aris Water Solutions Inc Earnings Call Transcript
Key Points
- Aris Water Solutions Inc (ARIS) achieved adjusted EBITDA of $50 million in Q2 2024, up 17% year-over-year.
- The company saw a 5% year-over-year increase in produced water volumes.
- Aris Water Solutions Inc (ARIS) maintained adjusted operating margins of $0.46 per barrel for the second straight quarter.
- The company has significant balance sheet capacity and flexibility, with net debt of $438 million and a 2.2 times debt-to-adjusted-EBITDA ratio.
- Aris Water Solutions Inc (ARIS) signed a letter of intent with an established iodine production and marketing company to construct the first iodine extraction facility in the Permian Basin.
- Sequentially softer quarter volumetrically due to natural declines from significant produced water flowback volumes.
- Groundwater sales are expected to decline over time as the company focuses on delivering increased sustainable, profitable, recycled produced water volumes.
- CapEx for the first half of 2024 was front-end weighted, with $75 million invested, which may limit flexibility for the remainder of the year.
- The company faces challenges in the M&A landscape, with high valuations making some acquisitions unattractive.
- There is uncertainty around the commercial viability of extracting other minerals from produced water, despite the progress with iodine.
Greetings. Welcome to Aris Water Solutions second quarter 2024 earnings conference call. (Operator Instructions) Please note, this conference is being recorded.
I will now turn the conference over to David Tuerff, Senior Vice President, Finance and Investor Relations. Thank you. You may begin.
Good morning, and welcome to the Aris Water Solutions second quarter 2024 earnings conference call. I am joined today by our President and CEO, Amanda Brock; our Founder and Executive Chairman, Bill Zartler; and our CFO, Stephan Tompsett.
Before we begin, I'd like to remind you that in this call and the related presentation, we will make forward-looking statements regarding our current beliefs, plans and expectations, which are not guarantees of future performance and are subject to a number of known and unknown risks and uncertainties and other factors that could cause actual results to differ materially from results and events contemplated by such forward
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