Select Energy Services ( (WTTR) ) has released its Q3 earnings. Here is a breakdown of the information Select Energy Services presented to its investors.
Select Water Solutions, Inc., a leader in sustainable water and technology solutions, serves the energy industry by providing critical water infrastructure, chemical manufacturing, and recycling capabilities. The company announced its financial results for the third quarter of 2024, showcasing a 2% sequential increase in revenue to $371 million and a significant rise in net income and adjusted EBITDA.
The company’s financial performance was bolstered by the strong results from its Water Infrastructure segment, which saw a 20% rise in revenue and a 33% increase in gross profit before depreciation and amortization (D&A). Select also secured multiple long-term contracts to expand its pipeline gathering, recycling, and disposal infrastructure, with planned capital expenditures between $37 million and $42 million. Despite a seasonal slowdown anticipated in the Water Services segment for the fourth quarter, recovery is expected in the Chemical Technologies segment due to new product developments.
During the third quarter, Select reported $51.9 million in operating cash flow and $20.4 million in free cash flow. The Water Infrastructure segment achieved a gross margin before D&A of 56.7%, comfortably surpassing its 50% margin goal ahead of the 2025 target. The company also increased its quarterly base dividend by 17%, reflecting confidence in sustained growth and profitability.
Looking ahead, Select Water Solutions remains optimistic about its growth prospects, particularly in the Water Infrastructure and Chemical Technologies segments. The company aims to achieve record annual adjusted EBITDA and expects more than half of its profitability to be sourced from these segments by the end of 2025. As ongoing capital projects come online, Select anticipates substantial year-over-year adjusted EBITDA growth, reinforcing its position as a comprehensive water solutions provider.
