NYSE$WTTR
Select Water Solutions Inc · Q3 2023 earnings
Q3 2023 earnings · · Investor relations
Briefing
Select Water Solutions reported Q3 2023 financial results with revenue up 4% year-over-year and strong operating cash flows.
Select Water Solutions announced its Q3 2023 financial results, reporting a revenue of $389.3 million, a 4% increase compared to Q3 2022. The company delivered strong operating cash flows and reduced accounts receivable by $75 million during the quarter. The Water Infrastructure business saw solid sequential revenue growth and margin improvement.
- Generated consolidated revenue of $389 million during the third quarter of 2023, up 4% year-over-year as compared to the third quarter of 2022
- Water Infrastructure generated revenues of $58.4 million, an 86% increase year-over-year as compared to the third quarter of 2022
- Delivered $118.2 million of operating cash flows during the third quarter of 2023
- Announced multiple new contracted infrastructure projects expanding upon existing systems in the Northern Delaware Basin and Haynesville Shale
Headline financials
Revenue & EPS history
Select Water Solutions · Revenue · Quarterly
$389M
Revenue by segment
Select Water Solutions · $389M total across 3 segments · Q3 2023
- Water Services$252M+13.8%64.7%
- Chemical Technologies$79M—20.3%
- Water Infrastructure$58.4M-21.5%15.0%
Forward guidance
Select Water Solutions anticipates continued strong free cash flow generation in Q4, with full-year targets intact. Net capital expenditure forecast is tightened to $120 to $130 million. Water Infrastructure revenues are expected to increase by mid-single digit percentages during Q4 2023, with gross margins before D&A improving 200-300 basis points.
Tailwinds
- Expect to continue to generate strong free cash flow during the fourth quarter, with our full-year targets intact
- Net capital expenditure forecast tightens further to $120 to $130 million, remaining within our latest guidance range
- Recent organic recycling and disposal infrastructure projects have delivered strong performance over the last few quarters, and we expect to see this momentum continue in the fourth quarter and into 2024
- Have a very strong backlog remaining for both greenfield and brownfield infrastructure system projects, and we expect multiple additional capital projects will come under contract in the months ahead
- The Company anticipates Water Infrastructure revenues increasing by mid-single digit percentages during the fourth quarter of 2023, with gross margins before D&A improving 200-300 basis points, supported by the accretive margin contributions of new organic projects commencing operations during the quarter.
Headwinds
- Contributions from net working capital will abate given the outperformance to date
- Saw some impact to consolidated revenues from a more than 10% decline in U.S. onshore completions activity according to industry data
- For the fourth quarter of 2023, the Company expects to see revenues impacted by year-end seasonality with segment revenues down mid-single-digit percentages.
- For the fourth quarter of 2023, the Company anticipates seasonal impacts to revenues and margins, with revenues down low- to mid-single-digit percentages with 19% – 20% gross margins before D&A.
- Though we did see some modest regression in the consolidated margins during the third quarter
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 2023
+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
| Quarter | Report date | Reaction (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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