Aris Water Solutions — Q3 2024 Earnings Presentation
19 slides from Aris Water Solutions's earnings presentation, Nov 5, 2024
Slide 1: Aris Water Solutions, Inc. – Earnings Presentation Third Quarter 2024
Aris Water Solutions, Inc. – Earnings Presentation Third Quarter 2024
Slide 2: Cautionary Statements
Cautionary Statements Forward-Looking Statements This presentation and the oral statements made in connection with this presentation contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 193
Slide 3: Aris Provides Essential Water Sustainability Solutions
Aris Provides Essential Water Sustainability Solutions We are a leading, growth-oriented water infrastructure and solutions company focused on unlocking value in complex wastewater streams We provide full-cycle, sustainable water handling and recycling solutions that improve the environmental footpr
Slide 4: Overview of Aris's Water System
Overview of Aris’s Water System Asset Footprint Aris Infrastructure Asset Highlights as of September 30, 2024 Produced Water Pipeline Right of Way Miles of Pipeline ~775 Water Handling Facility Water Recycling Facility Produced Water Handling Capacity ~1,800 kbwpd Customer Acreage Water Recycling Ca
Slide 5: Third Quarter 2024 Highlights
Third Quarter 2024 Highlights Highlights 3Q24 1,577 Total 2Q24 1,455 Volumes(1) ✓ Increased produced water volumes 2% 3Q23 1,516 sequentially and 6% year-over-year Operational 3Q24 1,118 Produced Water 2Q24 1,093 Volumes(1) ✓ Increased Water Solutions volumes 27% 3Q23 1,056 sequentially 3Q24 459 Wat
Slide 6: Key Operating and Performance Metrics
Key Operating and Performance Metrics Volume Profile (1) (kbwpd) Adjusted Operating Margin (2) ($/bbl) Produced Water Handling Water Solutions 1,577 1,523 1,577 $0.46 $0.46 $0.45 1,497 1,516 1,455 $0.43 $0.42 1,416 1,376 1,305 $0.41 $0.41 1,242 482 364 459 $0.40 1,167 452 460 362 $0.39 1,092 $0.38 5
Slide 7: Further Increasing 2024 Adjusted EBITDA Range
Further Increasing 2024 Adjusted EBITDA Range ▪ Based on current customer forecasts, anticipating strong completion activity to drive increased water solutions volumes through year-end ▪ Further increasing 2024 Adjusted EBITDA (1) range to $208 to $212 million, a ~10% increase versus initial 2024 ou
Slide 8: Balanced Capital Allocation Strategy and Increasing Shareholder Returns
Balanced Capital Allocation Strategy and Increasing Shareholder Returns Aris’s Capital Allocation Framework ▪ Continuing Commitment to Balance Sheet Strength and Flexibility Operating Cash Flow (-) Interest Expense − 3Q24 leverage at ~2.04X (1) vs. target leverage of ~2.5X-3.5X (-) Maintenance Capit
Slide 9: The Next Phase of Water Management: Beneficial Reuse & Mineral Extraction
The Next Phase of Water Management: Beneficial Reuse & Mineral Extraction 3Q24 Update ▪ Beneficial Reuse − Throughout the 3rd quarter, Aris operated a third desalination technology pilot for treatment of high salinity produced water − This pilot demonstrated lower energy consumption than previously
Slide 10: Appendix
3 ARIS WATER, Appendix ARIS
Slide 11: Aris's Contracted Acreage Features Low Breakevens and Multidecade Inventory Life
Aris’s Contracted Acreage Features Low Breakevens and Multidecade Inventory Life Aris has Premier Contracted Acreage With Low Breakevens… … and Multidecade Remaining Inventory (WTI/NYMEX) BE 20:1 ($/bbl) 6-month Cumulative Oil (bbl/1000 ft) Total Remaining Locations by DSU 11 Sources: Enverus.
Slide 12: Sustainability Highlights
Sustainability Highlights 2023 Sustainability Report Aris published its third annual Sustainability Report on key Environmental, Social, and Governance metrics in 3Q 2024 Sustainability Highlights & Recognition Selected as one of four finalists for the Water Reuse Project of the Year as recognized b
Slide 13: Aris Water is the Pioneer of Cost-Effective, Full-Cycle Water Management
Aris Water is the Pioneer of Cost-Effective, Full-Cycle Water Management Full-Cycle Water Management Full-Cycle Water Management Business Model ▪ Diverse revenue streams provide a reliable Collect Water Handling Fee base business with significant upside potential Water Production From Handling Exist
Slide 14: Aris Has a Premier, Long-Term Contracted Customer Base
Aris Has a Premier, Long-Term Contracted Customer Base Contractual Underpinning 3Q 2024 Top Customers by Revenue (2) ▪ Provider of choice for leading, blue-chip E&P operators Other 23% who have been consolidating the basin ConocoPhillips − Strong track record of repeat business 39% Oxy − 35 long-ter
Slide 15: Appendix: Non-GAAP Financial Measures
Appendix: Non-GAAP Financial Measures We have included certain financial measures that are not calculated in accordance with GAAP in this presentation including Adjusted EBITDA, Adjusted Operating Margin, Adjusted Operating Margin per Barrel, Capital Expenditures, net debt and leverage ratio. We bel
Slide 16: Appendix: Non-GAAP Financial Measures (cont'd)
Appendix: Non-GAAP Financial Measures (cont’d) Adjusted Operating Margin and Adjusted Operating Margin per Barrel We define Adjusted Operating Margin as Gross Margin plus depreciation, amortization and accretion. We define Adjusted Operating Margin per Barrel as Adjusted Operating Margin divided by
Slide 17: Appendix: Non-GAAP Financial Measures (cont'd)
Appendix: Non-GAAP Financial Measures (cont’d) Net Debt and Leverage Ratio We define Net Debt as principal amount of total debt less cash and cash equivalents. We define leverage ratio as Net Debt divided by trailing twelve months (“TTM”) Adjusted EBITDA. The following tables set forth a reconciliat
Slide 18: Appendix: Non-GAAP Financial Measures (cont'd)
Appendix: Non-GAAP Financial Measures (cont’d) Capital Expenditures We define Capital Expenditures as cash capital expenditures for property, plant, and equipment additions less changes in accrued capital costs. The following table sets forth a reconciliation of cash paid for property, plant, and eq
Slide 19: Sustainable Water Management
Sustainable Water Management 19