NYSE$WTTR

Select Water Solutions Inc · Q3 2022 earnings

Q3 2022 earnings · · Investor relations

Briefing

Revenue increased sequentially, and the acquisitions of Breakwater Energy Partners and water gathering pipeline and disposal assets from Cypress Environmental Services were announced.

Select Energy Services reported strong third-quarter results with sequential revenue growth and increased profitability. Net income and Adjusted EBITDA grew significantly, and the company completed strategic acquisitions to enhance its water infrastructure and service offerings.

  • Revenue of $375 million generated during the third quarter of 2022, up 12% sequentially from the second quarter of 2022
  • Net income of $24.7 million and Adjusted EBITDA of $62.8 million during the third quarter of 2022, representing sequential increases of 70% and 32%, respectively
  • Acquired Breakwater Energy Partners, LLC, a leading provider of contracted water recycling and infrastructure solutions focused in the Permian Basin on November 1, 2022
  • Acquired Bakken Shale water gathering pipeline and disposal assets from Cypress Environmental Services, LLC on November 1, 2022

Headline financials

Total Revenue

$375M

Previous: $205M+83.3%
EPS (adj)

$0.22

Previous: -$0.14+257.1%
Capital Expenditures

-$50.8M

Previous: -$29.9M-69.8%
Free Cash Flow

-$29.5M

Previous: -$42M+29.7%
Net Income

$21.3M

Previous: -$12M+277.1%
Operating Income

$28.4M

Previous: -$13.8M+306.4%
Gross Profit

$58.8M

Previous: $8.99M+554.9%
Cash & Equivalents

$13.2M

Previous: $107M-87.7%
Total Assets

$1.07B

Previous: $868M+23.5%

Revenue & EPS history

Select Water Solutions · Revenue · Quarterly

$375M

Q3 2022+83.3%vs Q3 2021
Beat estimate in 10 of 15 quarters(67%)
ActualEstimate

Revenue by segment

Select Water Solutions · $296M total across 2 segments · Q3 2022

  • Water Services
    $221M+96.7%
  • Water Infrastructure
    $74.4M+102.2%

Forward guidance

Looking at the fourth quarter of 2022, the Company expects to see relatively steady revenue and gross margins before D&A, as partial quarter contributions from Breakwater partially offset normal seasonal impacts to the base business.

Tailwinds

  • The Company anticipates low double digit percentage revenue growth for the Water Infrastructure segment.
  • The Company anticipates gross margins before D&A in the high-20 percent range for the Water Infrastructure segment.
  • The Company anticipates mid-single digit percentage revenue growth for the Oilfield Chemicals segment.
  • The Company anticipates relatively stable margins for the Oilfield Chemicals segment.
  • The Company expects to see relatively steady revenue and gross margins before D&A.

Headwinds

  • Normal seasonal impacts to the base business.
  • Partial quarter contributions from Breakwater.
  • Logistical challenges relating to the COVID-19 pandemic
  • Supply chain disruptions relating to the COVID-19 pandemic
  • Volatility in oil and gas prices

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2022

Historical avgQ3 2022

+1.5%

Avg return

Earnings day

+2.1%

Avg return

5 days after

-0.0%

Avg return

30 days after

46%

17 / 37 earnings

Positive

+32.2%

Q3 2024

Best reaction

-13.0%

Q4 2022

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.9%+2.1%+4.4%
Q4 2025+9.1%-3.5%+8.7%
Q3 2025-1.3%-5.8%-4.1%
Q2 2025-5.4%-9.8%-8.2%
Q1 2025-11.8%+4.5%+7.4%
Q4 2024-5.4%-9.0%-24.0%
Q3 2024+32.2%+32.0%+38.1%
Q2 2024+2.7%-3.0%-0.4%
Q1 2024-4.1%-3.7%+12.2%
Q4 2023+16.0%+12.4%+18.6%
Q3 2023+2.2%+3.6%+0.5%
Q2 2023+0.1%-3.3%-2.3%
Q1 2023-2.6%+0.5%-0.8%
Q4 2022-13.0%-9.9%-23.4%
Q3 2022-6.2%+1.1%-11.2%
Q2 2022-1.3%-2.9%-3.2%
Q1 2022+9.9%+10.6%+11.8%
Q4 2021+14.0%+9.8%+18.6%
Q3 2021+4.2%+15.5%-5.6%
Q2 2021-5.6%-5.8%-2.6%
Q1 2021+15.2%+30.1%+26.3%
Q4 2020+3.3%-1.1%-16.7%
Q3 2020-5.2%+0.9%+38.3%
Q2 2020+8.7%+8.7%-1.3%
Q1 2020+4.2%+22.6%+31.2%
Q4 2019-1.1%-10.5%-58.1%
Q3 2019-1.1%-0.2%+0.0%
Q2 2019-4.1%-3.2%-3.4%
Q1 2019-3.8%-0.9%-3.9%
Q4 2018+4.9%+4.9%+23.4%
Q3 2018+11.8%+4.9%-10.7%
Q2 2018-5.0%-14.9%-23.5%
Q1 2018+6.9%+11.6%-9.6%
Q4 2017-6.0%-6.0%-17.2%
Q3 2017-4.0%-5.3%-3.9%
Q2 2017-0.7%-1.3%-5.5%
Q1 2017-1.6%
Q3 2016
Q2 2016
Q1 2016
Q4 2015

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