Earnings call transcript Q2 2023

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Operator

Greetings and welcome to the Select Water Solutions Second Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions].

As a reminder, this conference is being recorded.

pleasure your my Chris now is to host, introduce George. It may begin. you Chris,

Chris George

Thank Chief appreciate to everyone. for morning, the you, Good operator. XXXX. of We and results Vice Officer. and are Officer; Solutions Chief John With and call second and Founder, quarter President financial Swyka, Operating Select Nick Michael Chairman, our conference you today and Officer; Senior Executive our webcast review operational for Water us joining and Financial Chief me President Skarke, Schmitz, Executive Vice President

housekeeping recorded XXXX. John, website Before our to I release. telephonic replay access over today's by call replay The turn available August earnings for this call information a from accessible at also A available the until selectwater.com. replay I webcast to have will was and be There a few will XX, yesterday's included cover. of be items in also

on X, information as the or only this transcript replay information speaks note listening longer no reading. time may and Please XXXX, of of be accurate the reported that the call as August therefore, today, of time-sensitive

United current In Federal forward-looking addition, by management the contain forward-looking laws. during Securities made views the statements of within the Select's statements meaning of conference reflect call These the this comments may States management.

uncertainties, our read measures. released to as in risks, statements announcement yesterday and on to XX-Q made the on those Form Form our earnings XX-K, risks, uncertainties, non-GAAP reconciliations our actual of reports The differ expressed those current refer Please to reports is well results, report and financial for as quarterly X-K, encouraged cause various our contingencies on could contingencies. Form to understand our by However, from performance, or materially achievements annual listener management.

segment driven more of made outlined was consolidated release, and several operations on or in the in detail. These Nick on will in its which XXXX, position, have historical reporting structure. X, the company no cash changes as results reporting flows. impact to discuss segment our changes Changes company's by starting certain factors, were Additionally, June John earnings financial

periods within new from prior conform segment Historical the concurrent the include Water refer to of results operations additional recasted financial reporting to as company's structure segment those is supplemental information. Infrastructure sourcing filed in logistics Services report operations information water X-K with Investors available release information current and earnings on segment. to company's the www.investors.selectwater.com. However, recast our at for and remove the of the have the temporary the Form SEC Please the with been Water water section website the to

Now I'd like to over turn Schmitz. to President our Chairman, John CEO, the call Founder, and

John Schmitz

morning for with Chris. again us. thank be you discussing I'm Water Thanks, joining you Select today. Good Solutions to pleased and

and higher income The generation second free margin adjusted cash flow improvements, quarter and meaningful EBITDA. net strong saw

Our and efficiency our along continued our led focus and specialty business, improved infrastructure integration across to resilience the of solutions in D&A. X% sequential with the a operation profit before gross growth on strength and chemistry

able were of X% a still increased million, activity over the first to relative $XX grow to rig to 'XX. quarter, environment modestly increase completion While to quarter we income a second saw million, sequentially the declining EBITDA course the XX% $XX net by and adjusted we and

million components quarter. of but focused things, we of second cash flow to I detail, touch our deliver more a $XXX On the the during operations during can with capital working paying Nick off the in flow side and reduce second progress cash effort from our the pleased quarter. the made helped bit are am on

were free the to about EBITDA able nearly net $XX for Adjusting the for period. during the of through $XX million adjusted matching million spend CapEx flow, we cash of our pull quarter,

for flow room reduction allocation. cash provides a significant make effort, attractive for in on providing half a strides us improvement. I year, more reducing the options outside cash additional working opportunity see to capital generating Strong back over working this capital of with still to the free capital continue many expect for We meaningful -- but flow. progress free have outsized

During our the million $X by water of $XX.X buybacks, we And through second small ultimately, on still $XX million. and CapEx, to million quarter, weighted to returned our were net shareholders projects and $XX contracted closed we recycling acquisition. asset containment outstanding funded a about borrowings million able and dividends reduce heavily infrastructure toward bolt-on pipeline

have I We of position year-end. already provide outstanding war a debt-free portion borrowings the with our our us to shareholder expect cash priorities, Replenishing balance returns. ample repaid to opportunities a sheet our remaining with capital to by additional cash have chest including fully and a during growing review quarter date allocation will meaningful third again

returns opportunities. During M&A the paying we to to third addition against projects A growth the second able alone, were quarter our repurchase dividends X% to capital in shares, of and and we other continue outstanding will weigh quarterly

and years. pandemic, Combined on in recognized execution. satisfying than management safety, customers, rapid We to be vision. leader out our water coming prioritize, across of dedication we and XXXX growth the over is year Operationally, the achieving needed further And believe partner to market of closed very sustainable first excellence having operational entire retention, trusted to employee that enhance remain last job important the in a steadfast a and us, will continued foremost, with the dozen for more and activity our the we acquisitions pace project vision two solutions. organization

our pace has growth strategic as has have However, of the and the activity abated deal activity slowed, efforts. we transitioned

of and integration, acquisition executing flow generation. on infrastructure the cash from the certain our of and service free scale is and operations and, operational company at We locations. made to relocate excellence look entire non-core assets areas scope the closely XXXX appropriate, or and for improving consolidate projects on across organization across facilities efficiencies where focus Our determinations

opportunity most applications of strategic remain areas existing of lifecycle to the chemistry and capital most asset to dollar we'll base. or of We recycling we attentive where proprietary our every chemistry especially full integrate allocation deploy prioritize the add and solutions to technology Infrastructure automation, around and business, have the Water we capital

think to also investing We continue customers those services. prioritize work our them. to we We long-term, we where for and at value we'll work for versus times. all to continue that are hard who call-out to bring customers must in partnerships continue But about value-added seeking

strategic infrastructure scope we provide solutions our base. able strengthen With contractual around chemical we to the the are and and expand infrastructure with are our integrated that to footprint, we customers water well-positioned the have of relations

off adjustments these gross the While during a there from is still by basis declines pay closures. efforts across company and our points on basis yard improving more second we modest revenue quarter have limited XXX base, even the seen with and the consolidated the accomplish, resulted macro-activity margins to customer that with

In to continue our made the business to quarter, our allow organization. capital segment. manner, to what and changes certain Accordingly, temporary reporting our us better water and leadership a during will segment reallocate standpoint. logistics operation more manage operations think and Water about segment from water-sourcing makes the across Services Infrastructure deploy we our the similar sense These a into the second Water we most legacy from determination efficiently

excellence segment's changes operations that aligned side. core For around execution add are and the that Water job these completions-oriented with well closely service offerings Services, more

its Water solutions, reuse pipelines from now levered namely core all change the revenues contracted Infrastructure being are disposal segment, and facilities, infrastructure this the will focus recycling and further facilities. segment, For derived of production so that

before. these ever long-term duration are generating segment's related nature, than gross or the operations adding all more production are and nearly Importantly, margins solutions under to in contracts and high stability

growth realignment this their free highest and priority will Additionally, Water disposal dedicate up leadership Infrastructure pipeline to our around greenfield projects facilities. and areas fully brownfield to recycling our efforts

the projects We underwritten remains the in XXXX. about far expect year. this very quarter, our late in excited have recent to strong and With come project on additional backlog half already to third The growth XXXX of and with $XX contracted I'm XXXX. had of tremendous projects close multiple the this of success projects expected fourth segment so million we looking during quarter back into prospects online

provide the changes the implement visibility the made the will business. of and time were over for drive There segment components realignment the financial to to many and business I us that reasons clear the key believe performance into

I what additional transparency sense better We can to these operational will implement continue providing KPIs makes additional but accountability. to changes for a alignment that think provide for against, will ultimately business, and the reported be review and tracked

has of been the always driving developments and industry. Select solutions technology other forefront at the water of within automation advancement the

Select's chemical that industry produced it As clear to be specialty solutions part a and take driving the the critical sustainable is evolution reuse transition. water toward water of continues hold, will

Importantly, a growing Select positioned and around to technology chemistry is contracted infrastructure footprint. these deploy uniquely solutions

of provide will reuse sustainable, portfolio increased barrels, the care, beneficial technology to ultimate commercialization control and solutions. water or custody use, specifically a lifecycle the and an Long regardless reuse term, recycling strategic towards having and advancement of advance of produced advantage over full

As progress the was on encourage we to section sustainability This achievements the be additional commitment report and key found our for Select's XXXX in details I sustainability to continue of stakeholders, in future. support It our to targets sustainability listeners all review published to can date initiatives, these month. our of our for website. Select’s earlier report this

that and solutions the provide, across strategic our the the for create, become the the significant business. more Additionally, more more entire contracts and continue customers opportunity an value opportunities chemistry message consistent to get to the and is our amount that as scope have can a better of The customers. our paid we highlight and organization, full capabilities water and rebranding earn aligned of with there across to it value-add value long-term are we to our around additional successfully efforts more to we clear partners becoming integrated to visibility Select’s potential create will

seen pace about growth remain acquisitions center. we projects, development front core our recycling rapid business. our our and in will Infrastructure by When think we priorities, certainly a Supported and have recent Water business growth of

total recasted Infrastructure's a perspective, Water for of basis already X% has total half of profit for on gross during third a the in its fact, it put in on recasted Water profit quarter To consolidated a year gross full XX% profit D&A, company matched first XXXX before of XXXX. basis. Infrastructure of as percentage the from gross In expected grown about XXXX to about XXXX the

earned is facilities from chemistry our profitability XXXX, with expect future business company when that significant sustainable opportunities, than growth contracted disposal the recycling will pipelines, and specialty the more manufacturing. potential. specialty looking evolution be combined return shareholder and considerations lot of of I a XX% That financing solutions, that optionality the Select's When in production-weighted of by a at chemistry provides business,

to on and returns, shareholder this quarters. strategic I the execution for forward what further am the very Select profitability vision future holds growth, and in additional about coming excited executing look through

outlook half second and to I'll Nick a unlocking the detail. At let the firmly during in forward on second and of half beyond. look amount second cash our discussed of point, quarter and focused to are I've 'XX a initiatives this we bit meaningful speak Nick? more results But I

Nick Swyka

Thank everyone. you, morning, John, and good

Our and quarter. higher focus yield efficiency cash as second and EBITDA surrounding free strong adjusted gross quarter income company. advanced margins with a the operational macroenvironment flow Net quarter-over-quarter softened on and off generation in both the even the cash paid the for during

the our and and on water for sourcing Water rig through our proprietary completions investment purely today's it operations meets logistics Water decisions, assets. freshwater market's moving our technology we've operations count Infrastructure profitability solutions temporary into continue focused benefited segment, pruned model water from chemistry business water Our to expect lifecycle fixed the by full Streamline even Services and sustainable Water advanced at growing activity. Infrastructure the we segment need and lower and legacy

pipelines, and multi-basin facilities, in distribution and our We around invest infrastructure, and networks disposal treatment fixed recycling by water connected solutions. contracted gathering

financials growth the of towards around go these of While for a our dates. operational it Infrastructure. consolidated The accountability live capital Water impact our remain this an overhaul segment our transparency segment day-to-day margin doesn't as their investments with investments growth this that in should realignment reach advantageous impact grow provide targeted major reconstituted we of operations, our bulk investments will historical additional expect or and represent investors profile

team we implement mentioned, various quarter, businesses a collections dedicated operating technologies, the tremendous John reflected Select the benefit Water Select flow acquisitions, across in on the consolidate company. million and As This multiple the our cash departments our the during recent to into is to made new rebranding of Solutions. result progress cash integrate work $XXX of

flow, credit and target $XXX previous first a receivable should new the million $XX continues our target, by the during of year-end continue to by work quarter our facility around Accounts momentum this has top act market $XX we declined completed flow repurchases With share we year-end executed AR $XX remaining have regular potential and and and to to leaving cash quarterly prior be enjoy this million million strong over million. been to currently With is the as deployed. opportunities. the open on leg now of borrowings million on robust quarter strategic we cash ample rebranding expect raised of Furthermore, technology free reducing authorization. remaining $XX repay of range between to dividend liquidity

We buybacks in shareholder approach value of during quarter. repeating mind, like level activity regional on market reversal. With buyback that share plan third maximize to the with in that opportunistically recent parallel we philosophy dislocations don't bank the

back free With August the dividend plan the initiation share and marks re-evaluate expectation cash a consistent level our time. we profile, of revenue further our our contracted liquidity anniversary we to payout. ample stream the that hope half year, upcoming November over growing growing shareholder and production-levered our commitment to quarterly one-year the of to robust high-margin of However, per over of $X.XX flow returns of our regular and following and

the to million. $XXX income Water Select at by declined revenue looking sequentially Solutions' statement. X% second-quarter Now

efforts additional efficiency million sequentially, in $XX.X and our income $XX Net adjusted line nearly through gross higher $XX and the from increased dollars bottom product EBITDA the to million margins. optimization to from quarter. $XX.X However, first and further increased carried million to million business

prices the year. seen activity continue of the based movement we the present customers back along material remain not levels. the We've macro and and our the count have recently completions well-capitalized. pricing do any into remain quarter second highly profitability headwinds, generally steady Commodity in advance half strengthened rig declines While of and with profitable anticipate on believe through we company pricing activity overall we can to some

make the the of though and the an to in last we projects will bulk the will announced some of come early fourth begin growth third Additionally, impact quarter XXXX. quarters, in

management our supported solutions produced multi-basin water footprint. Sustainable a uniquely remains by for core priority volumetric and massive positioned a reliable Select's customers and with

in development We have announce various phases projects that a quarters. number of infrastructure coming in to potential incremental we expect of

deployed prioritized over assets not sequentially overlapping have strategy the locations generate targeting consolidating declined $XX the fully profitability a redeploy decline low X%. of segments. growth, Now limited opportunities higher digit We locations to improvement Services basis benefited up by expect of investment, that course revenue before maximize the from to recovery of a completions and on to walking rationalization to over would continue a gross we We higher lower margins less and Water the underperforming to activity and that than in a have more year are XXX to but cash updated little or those through to certain this D&A With percentage efficiently or still mid-single an revenue locations sell mind be with elsewhere. return them points. integrate profitability or million top-line environment. likely closing

Infrastructure XXXX. accretive XX% segment third range into gains later before believe our the XXX previously and the expected quarter well of recalibrated the online We the projects gross from percentages reuse revenue third points points. digit sourcing this above in margins delivered basis segment mid-single view Our operations of for by base recycling should continued strong and water D&A very first as a and the XXX from margins of margin future performance basis moving see provides logistics expect quarter. as to Removing and Water and water gross quarter, projects this as a a infrastructure. announced margin both of steady year we With clearer come scale the progression

XX% margin in reached success sales. exceeding chemistry level, segment continued with Technologies high gross specialty another Chemical all-time

results We expect activity to quarter in share market gains offset third quarter. second lower as industry steady the relative the

million primarily SG&A SG&A will at that around rebranding I from conclude to of the per million $XX ongoing the to $XX.X due and $X million the decrease deliver end sequentially the rebranding half Consolidated efforts costs. year year. quarter the in decreased $XX.X transaction a back of expect million, given of

announced last We of infrastructure and first $XX.X net on our of CapEx ground the million most second increased the we million call have $XX.X various of projects from on the broken quarter quarter.

previous effect CapEx to $XXX its full expected giving million, remains forecast with within a XXXX year $XX Our to million $XXX in that tightening range to range, million asset sales. net after of roughly

our I'm organic as critical pleased able while with facility sustainability pay linked over $XX executing $XX the little investments growth million the by as well heightened returns cash to we a flows, down these during of quarter. were shareholder our million credit

to We per million expense and during finish and depreciation continue liquidity of expense with remain million the million at quarter around liquidity XXXX. of $XX expect to minimal amortization We total tax to through quarter, added $XX $XXX

is We're dynamic our profitability free several of generating high-return than you. substantial long core footprint accretive these now Select and flow accomplishing to years our our enhanced growth, including and boosting and lives, extracting margins are out and infrastructure increased cash operating flow. cash priorities goals of After while investments margin additional XXXX ideally market-leading and XXXX acquisitions Thank positioned shareholder existing returns. deploying ever. into achieve stronger enter we

that, it we'll with Operator? to questions. open And up

Operator

Thank you.

Our a first now Jim will [Operator Raymond be James. conducting question comes session. We question-and-answer Rollyson, Instructions] from

Jim Rollyson

guys. morning, Good

John Schmitz

Jim. morning, Good

Jim Rollyson

north we’re of kind as generation are we said you'll XXX actually back to points all maybe quarter the Great points? looks stout before, obviously think and able was -- way we're isolated cash guiding than kind this classified show for Infrastructure up basis across as growth, XXX to they on pretty XX% growth generation. of the be more little basis free the to -- Nick, sequentially margins a but Water and on see of about and ago, minute to of margins the something it which Kind progress cash a like, reported flow now, to fronts it you flow circling the margins

just As is late where just what go in you something I how projects next is you looks XXs? something start thinking that mean but the mid-XXs, I just incremental any might and hit Just some the about that I based underway? you margin and sense that all are XQ think really opportunity to? in XQ, provide project accretive, about these impact sense year, the some for that how as that said low can of new maybe business business that's of know when that on on margin XXs-percent high hitting color already maybe have revenue that -- you've

Nick Swyka

Sure, Jim. Thank you.

So as Infrastructure we some I'd be to at point run rate look forward segment, Water that late on at XXXX. a like XX%

there? announced we Now call. projects million We get infrastructure of how $XX our last do in

three-year contracted As you know, potential to a we payback like additional or third projects with with upside parties from expansions. underwrite window

a million alone. of healthy little do gives a you EBITDA, from math there plus $XX those just million, So bit that and $XX pretty you projects

We projects back XX% and it do or expect will some additional add to better. of add next here, over accretive the detail to at that quarter come half that and the to back margins and the of into year

growth as the not acquired couple as rate over networks, that we've forward, today we here it in years. optionality the exit So to that XX% to to is bring real in we expand of other where with continue of basins the and just past the develop around but assets these of engine additional many continue Permian recycling, that's segment of when around XX% from we look taking an

Michael Skarke

this is Michael. Jim, And,

of on was to Just of part said in Nick something timing, that terms question. expand your which

can a the then rate commercial time that run little And to operational going to is nine take to infrastructure and we about buildouts to a you varies are complete, really that the see You and think of work the issues. have bit of but point, at that when And once you're months. it, going to on our full an as buildout, seven then construction you start project of well. think through contract contribution. most when project, And to then take, it -- underwrite execute

Jim Rollyson

still if next of Kind we go obviously last guys margins any opportunities and elsewhere. of quarters. underwriting are are sized you projects there hitting singles, that. obviously over curious, are of on any talking like And or out that there people what there's have you projects rebranded well? -- you you just similar larger of few and absent size Permian as larger, as steady opportunity sounds have of through been top top we kind that? in doubles, XX material or But been new guys as Are on the months of starting ramp to the projects, We've to kind more there's actually so of, kind highlighted see and what steady great capable

Nick Swyka

going average a is quite bigger projects things the or anything it's we interest, pretty through be able say, that And what projects We're I something than $X announced. lot We're to for large that larger. to rebrand $XX of deliver to and my They more to executing confident -- from basins customers. are of there half of within small that the as we'll be on are be And million range we're smaller definitely like our the expectation just both. getting John talking of able build-out. range the of back interest our all looks whether and a footprint. mentioned, that it's the hope about, kind across getting on But in a lot deliver year. deals million to in are deals, would still we're we've deliver really

Jim Rollyson

M&A efforts. on back Curious prices. obviously last things year of be given flow going you get probably John, are cap opportunity for you kind lot chunk phase, market busy you at forever, or question. of of a And shares, your integrating today. past re-buy is focused bunch cash can't generating this integration M&A of one kind shares the free that of the set just and then your to your all given business outlook as everything, just the guys you've buy a And consolidating on overhauling were what good front, and the guys attractive a spent the Fantastic. rebranding pretty

next of So opportunity set the here kind of just curious over the years? couple

John Schmitz

lot together, lot Yeah, companies. opportunity we footprint what great We we've base together is question. across did really transactions put -- put really, a position as of we Jim, really it's areas opportunity busy put across XX, importantly, most were on. with and and of this lower But number asset asset around but -- the the together, them in one that really we're that some a base the focused

a we If our that both and expand volumes focused asset you ask something right as on is within me for very we're asset capital opportunity table are it and very if together this us, M&A, bring opportunity add that there's as base it. long very enhance to if that, good for to fits that unique. the to there's it's infrastructure that a customers for we because or all way put now or base But

and either asset asset pipelines some to And of are other network the are that them base to of the a of in and a to large size -- singular. we more the the they up to conversation, are base of in lot of versus each lot or there Michael's have them but point, small we've is already announced opportunity become small hook to there's place of ones a a a bring lot outside water

water network because there's what's we not the tells really it asset now. that the is add opportunities together what we our base paybacks we also driving are the contracts a quick the Some somewhat paybacks. overlaying customer of XX-month and just and large ourselves, would but and very concentrated water base, are, position put either rebranding them our things I of recycling very or really important, who facilities, of pipeline infrastructure to, we investors, is long-term and quantity They're are yes, over put this together

Jim Rollyson

Yeah.

place you, Sounds Great great see like a progress. guys. to to Thank deploy capital. the

John Schmitz

Jim. Thanks,

Operator

Our comes next Piper. Luke from Lemoine with question

Luke Lemoine

morning. good Hey,

John Schmitz

Luke. Morning,

Luke Lemoine

It margins Good talk margin margin modestly down revs there, question. Services, and improvements with Water Water efficiencies you helpful. has I in improvement of guess with and a can down kind seeing Can down. have unprofitable go but maybe about of even in XQ any tackled to revs operational to some rationalize ticking the same can sounded locations asset you're of on environment. that'd some even morning. the the where margins might outlook this And Jim up. Infrastructure like the commentary nice provide you closing be been continue base. But flattish

John Schmitz

Sure.

So, Water elimination one, drivers to Services pieces, goal chemical in or even on profitable. some are, as XXs. water the that just to and rationalize But margins our and to unprofitable the integrated strategic hit not it the moderately integration for our could mid longer we're that look pressure expecting that, two, have be in And some flat in yards or consolidate revenue. with we XXs by to term downward is or improved the that activity. And further margins, further is directly Really, potentially part that and of the the of high of near-term consolidation integration.

was and where required to the bring efficiency. -- COVID services that's mean, back be. to the is I organization a operational need now, every far to that enough. it efficiency. business to the really get piece really we're the discipline integration just from beyond and We've day So other in needs we execute And built removed

So we're of doing things. number a

cost-effective that help that on, across hit brought number One do of a we technology. been group the and of segments. things But a the customers. very those service committed implementing kind more is solution our and improving to say around provide technology I to for We've the thing really supply we robust and to tackling everyday us to power across add of services margins to things just chain more there's need to medium and And one blocking buying long-term and would final certain, all leverage automation margins. a better safer,

will good which there's think we job that still of areas, profit in I technology, can for bottom of line. implement a good a some number drive we've the places that to pretty done but

are those what services, on really we're Luke. So focused

Luke Lemoine

Thanks it. bunch. a Got Perfect.

Operator

The next with question Seaport is from Tom Curran Global Securities.

Tom Curran

you. Thank guys. morning, Good

to division having XX, Water quantified with us tying structural along you through of operating. and adding provide how for new online we potential close branches? XX%? estimate with Just year maxed are XX%, those revenue are at they? Infrastructure, For existing XX this now in a far those sites customers and How entered Will their generation out XX are

Nick Swyka

on that's for really full it can are comes typically some individual we have in the So, sites time. a site, of time. But down not sustained. points to out that period And

If that a still excess capacity. apply knife just I butter say you across them, were meaningful would have to we

the somewhere to projects of So a customers we say we in bump up in to the have are can leverage our are XX% in can nature we'll more so tie that. that terms XX% customers those market. And I and against and the capacity. the them extent range modular expand And expand to of would capacity Many of we that the is we're of lot to meet in in that looking it we on to to continue utilization. so that start working needs that expanded

John Schmitz

Yeah, one projects add top -- this been John. these Tom, asset thing to really I'd that we've to and into on base, to One it's assets. is water thing an this asset is to of increase develop has And this of to needed recycling base continue as turned able a a asset individual that across produced capacity places opportunity about removing on from disposal more system. places you think major or and moving our as water system effect overlay broad-based

allows the putting So meaningfully. for capacity them together increase to actual

Michael Skarke

highs the so and of single system kind and shape lows to able the Because somewhat. to work through you're utilization, not you're that peak by limited

John Schmitz

to been go about really it's Water this through volumes business And business or how we think But really it's us relationship really specialized a large to opportunities, bringing added to because becoming the very now. of of Services of great well systems to that it, itself and or assets how mix. whether It's or services now last chemistry have the specialized allowed thing on we've with between top develop or water market or chemistry we able think expansion recycling we the different. do, footprint margin also produced the into infrastructure. overlaying Tom, one there's it's And

Tom Curran

pursuing Has increased, then opportunity a last the more recycling us. you set. total total full in the dropped you number many you're the those of And believe then of that on out? how all makes facilities? your of that chasing, inquiry us of projects that update been current XX lifecycle you And number? Could two gave as it Water sense. any That same, I questions have had update held entail on of line here Infrastructure's

Michael Skarke

So on the increased fallen cross the the And to you Generally speaking, last number and of it is time. two have from obviously fluid. set the but signatures is line Deals where go. set, paper. never a finish piece was get opportunity if some really opportunity until can going know come it's out, you

at we would least be above of that lifecycle kind And So or projects. water half today. be better would full

our having into So we're as existing on produced about getting is. talked chemistry water those a much there’s -- to And that focused in the footprint everything solution. starts we've full components that lot we're of water But interest we're infrastructure from footprint. ties the lifecycle what big the around it our it where -- of really, that’s But across the and because again, in Permian that's conversations so is small.

Tom Curran

promising. queue. but not I'll very return sounds Wow. the That's to surprising,

John Schmitz

Tom. Thanks,

Operator

is question John with Daniel next Daniel from Partners. The Energy

John Daniel

morning. Good

you're I Just of would realized, one here. like a CapEx next that the of to what year? be random that were completely projects few all if could type questions the guess look be evaluating first

Michael Skarke

Michael are been opportunities it the us announced as we've to to most are cash important have handle you. -- and XXXX ones is number that larger of, than What's it kind larger, year's, do hope than get on We better they larger we've If for mentioned, next John, will within heading to that be budget recently. would certainly. be into much today similar realized, certainly all a flow. that's are that we or ones

pursue that across nationwide. projects. We high knowing can that recycle it We we can have dispose care return We we across pursue over So custody Select, with We of water we basins, water. an volume customers. move immense it it. and control, can

all Ultimately, better are and beneficial these that goal, we hope furthering, is water connectivity. to projects really be the that economics greater drive what in able that's to through reuse. ability that system, to use And

have So to we expand. potential do

hope going potential I course, more about a gas apply also but very done. what thoughtful the our solutions calls. that judicious We're exciting traditionally on lot and that, oil We into future of of to we've of have beyond to and horizon to things beyond be some get and in

John Daniel

Got it.

to for the might services a think to is get sense you the your you accelerating driving I’m all growth demand what's trying relative question, last whether really the of I for in Now, experienced actually have or year so?

Nick Swyka

about mentioned, did those. we a more months six that's discussion Yeah, under and long-term certainly when projects contracted than as talk have we we ago, Micheal projects

John Schmitz

John. Hey,

off facility Before in we it. it's are know around set I to develop John. than finding we build well the had more subject, Water us out is do opportunity we because services the it's as between be more and actual driving interaction related as ability I that your but direct question, to and believe what the as it job this answer adds an Infrastructure, for get different services facility something and What the that it we don't to as if that before the to it, we could

Michael Skarke

chemistry would thing you in managing there a the produced chemistry, Select complex for recycling the focuses you're be chemistry as true put and around water applying same recycling water usable augmentation to right the more and it component. And -- Really but and really an making fees, facilities again, on matching frac that well. which augment with water there's effect as specializes into the that,

it's So piece. chemistry and the services

John Daniel

to learn follow Interesting. more. enough. the up Fair on that to have line I’ll

are all operate? geographic projects the said outside but point, different and basins, new -- On I potential presently in seeing areas projects you of where this in at any you're I'm the if various new curious you -- know you're --

Michael Skarke

where yes. the largely in projects as we is that's well haven't where are don't is, areas mean because like the the much haven't so is on where Short as areas answer them. or the in announced still we where but seeing -- focused new in produced distribution activity I been past, DJ the have of we water the Permian, in we've

some to continue it, other want the that with you think reuse basins catch-up you're front. kind to think seeing and I wrestle of So or on of the about and produced challenge, however opportunity challenges water

presents as really But us, our an for you asset base, complex that's newly embrace it that so existing acquired oftentimes infrastructure excited about there more on and the with butter. really because opportunity And and it, of also reuse, start more the one, is around asset our we brownfield bread kind the associated side, base. chemistry to get of chemistry that's

John Schmitz

we we'll projects but or infrastructure not have typically areas at Alaska yet recycling John, but those not have or we're to just offshore major here. in looking those And going areas, facilities anything in operations may or

Michael Skarke

Yeah, existing should our footprint. I have specified within

John Schmitz

adds believe and before John, get question question. off of to has your to effect And that we it a again, your it's subject point because I

active we you now thing centralized second it's recycle, a adding if and back take hauled we contracted deliver out disposal together pipe that with system position water Haynesville or the a we right add big probably Nuverra being pipeline hook large Haynesville become that's that’s it about, opportunity transaction, the the continue lay water produced to hook talking an Michael quantity continue projects Haynesville our are is the or add but Shale have but You and there in that and for we actually the in with Haynesville to it of [indiscernible]. are the to that network that a and can got got network and more to what interesting to the backlog is that backlog, has good to of disposal of piece really that out but together

John Daniel

like what Okay. water that the question, fluid ago? have road or is a old But go bit a factors might curious four final to opportunity today fleet, of years trucks, when electric? to I many how lot business, I'll trucks just going the to back back to I'm And you on maybe Interesting. then which question. had the admittedly of have And my for a what's are you guess That's hauling nerdy the it CNG-powered five set versus running me. on think

Michael Skarke

each other I are and looking one John. John to this on

John Daniel

-- you told I

Michael Skarke

with that I but it, thought being to No, in follow you by it's when teeth in I a mean, get question, water of great your a yeah, can I while, about need think day. you sink truck delivered really probably about back it you the the haven't up was all something frac in to

John Daniel

Yeah.

Michael Skarke

granted the And and is produced of are infrastructure was now frac lot So smaller, as for a the that flowback limited trucks. non-existent well. water the pipeline but sizes or

to all pipe. the in And delivered -- -- and the not taken of at today going pipe. you've is so basins, is is northeast except least produce the to or come the all frac majority, the going be for And -- water being through if most flowback is by hose

So going in there's there. lot the trucks of substantial. for amount And of out be always still trucks an dramatic. pretty to industry that the aspects. a we've And as a eliminated But them reduction certain is there's is need

there's economic CNG of the the challenge, you're over also terms there's and of, we've In looked but CNG, logistics. the piece, well of aware LNG at the just years. Part as

make really your to it planning. yard sure your disciplined and And about at thoughtful yourself work route have kind put so you're that and in to you really infrastructure that of just make

John Schmitz

Hey, John.

very and a have think to oilfield place trucks they meaningful continue all to getting Tank and that off really has important I they it's executed get service pipe we that component clear. the in be a not subject, produce today, place that's is way a Before are today. still They will and water to hooked place. a in

forward. but it be through of other believes, application and to natural we directly And bring will motor technology believe, the it's and to. truck cab or the of that those gas The the to a advanced compressed that advanced position automation as going advancement not answer, the been would answer Select and not you, to type we go be technology different through trucks has of

John Daniel

enough. Thank indulging this you Fair for my questions morning.

Michael Skarke

Thank you.

Operator

Tower next from Robertson Jeff The Water with is Research. question

Jeff Robertson

morning. Good you. Thank

longer all as also and jobs, completion continue solutions question, side volume Just But an the opportunity does provide obviously can operators present laterals for to that on a do push where can larger higher to it you customers? for what does you for margin customers? to present opportunity for they an

John Schmitz

get longer to jobs or laterals frac site, try a by automated because around very customer complicated technical. is more it's completion, Select that XX-hour technical whether as automated laterals activities John. complexity and opportunities manifolds, pumps, getting I'll recycling, is efficiency are in of to But our the period in are position those to to simul those continue utilization take answer of Yeah, of more water the demanded well and this it. the that is And good use sources, and jobs very it be multiple Longer the now. a for water, or that.

So but it's us, things. for yes, complicates it a plus

Jeff Robertson

or your your into play strength Does just site management? can customers that Select for deliver hand the with to what

John Schmitz

Select's built large has across developed you It look but what complexity into of years water lateral, or have Water longer the our also we’ve pad if simul and Select last into because and really of developed quantity job history the thesis, back XX plays Select's fracs that around. Yeah. plays it technology fracs in is drilling

really AquaView, brought sources our aid automation, into pump job needs to So it's be what for solution technology, backbone a big of delivery, is that the about.

Jeff Robertson

questions. my taking for Thanks

Operator

would to turn floor Schmitz over I closing session. question-and-answer our the concludes John to back This like comments. Please. for

John Schmitz

Select operator. Solutions. today look we interest Thank for the to you learning quarter. And definitely and speaking to giving more joining for us again next forward Water in call And about the you, thanks everybody

Operator

thank participation. you for gentlemen, and today's This concludes your teleconference. Ladies

You may and a day. your disconnect lines wonderful have

Select Energy Services (WTTR) 3 Aug 232023 Q2 Earnings call transcript