Select Water Solutions Inc · Q4 2021 earnings

Briefing

Select Energy Services reported a revenue increase and a return to profitability in Q4 2021, driven by acquisitions and organic growth.

Select Energy Services reported a strong fourth quarter with a 25% sequential increase in revenue to $255.1 million and a net income of $11.2 million. The company benefited from recent acquisitions and organic growth, leading to improved margins and positive net income.

• Revenue increased 25% sequentially to $255.1 million.
• Net income was $11.2 million, a significant improvement from the previous quarter's net loss.
• Adjusted EBITDA rose to $26.4 million, up 74% sequentially.
• Recent acquisitions, including Complete Energy Services, Agua Libre, and HB Rentals, contributed meaningfully to revenue growth.

Headline financials

Revenue & EPS history

The Company expects to see 5% – 10% revenue growth with modest improvements to gross margins before D&A for Water Services. For the Water Infrastructure segment, the Company anticipates the combination of the contributions from the recent acquisitions, including the pending Nuverra acquisition, and the recently completed recycling projects will result in 10% – 15% revenue growth, with gross margins before D&A in mid- to high-20 percent range. Supported by the recent strong revenue growth in the fourth quarter of 2021, the Company anticipates relatively stable revenues in Oilfield Chemicals segment during the first quarter of 2022 with modest improvements to gross margins before D&A.