Q2 2024 Select Water Solutions Inc Earnings Call Transcript
Key Points
- Improved consolidated operating margins by 2 percentage points sequentially.
- Reduced SG&A by 11%, contributing to a $11 million increase in net income and $10 million increase in adjusted EBITDA.
- Water infrastructure segment achieved record high revenue and gross profit, with an 8% increase in revenue and 17% increase in gross profit before D&A sequentially.
- Completed strategic acquisitions adding over 615,000 barrels per day of permitted disposal capacity, enhancing infrastructure in six primary operating regions.
- Signed multiple new contracts in the Northern Delaware Basin, significantly expanding water recycling capacity and geographic footprint.
- Natural gas prices have been challenging, impacting overall activity levels in the first half of the year.
- Water Services and Chemical Technologies segments faced a more challenging activity outlook, with a 9% decline in manufacturing volumes in the Chemical Technologies segment.
- Certain permitting delays impacted the construction timeline of the Thompson pipeline in the Bakken region, pushing its expected contribution to the end of 2024.
- Continued trimming of revenues from legacy fluids hauling service line, impacting overall revenue growth in the Water Services segment.
- SG&A costs, while reduced, will continue to incur modest transaction and integration-related costs in the third quarter.
Greetings, and welcome to the Select Water Solutions second-quarter earnings conference call. (Operator Instructions) As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host, Chris George, Executive Vice President and Chief Financial Officer. Thank you, Chris, you may begin.
Thank you, operator, and good morning, everyone. We appreciate you joining us for Select Water Solutions conference call and webcast to review our financial and operational results for the second quarter of 2024. With me today are John Schmitz, our Founder, Chairman, President and Chief Executive Officer and Michael Skarke, Executive Vice President and Chief Operating Officer. Before I turn the call over to John, I have a few housekeeping items to cover. A replay of today's call will be available by webcast and accessible from our website at selectwater.com.
There will also be a recorded telephonic replay available until August 14, 2024
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