Aris Water Solutions, Inc. (NYSE:ARIS) Q4 2022 Earnings Conference Call March 7, 2023 9:00 AM ET

Company Participants

Bill Zartler - Founder and Executive Chairman

Amanda Brock - President & CEO

Stephan Tompsett - CFO

David Tuerff - SVP, Finance & IR

Conference Call Participants

John Mackay - Goldman Sachs

Spiro Dounis - Citi

Samantha Hoh - Evercore ISI

Praneeth Satish - Wells Fargo

Selman Akyol - Stifel Financial Corp

Operator

Greetings, and welcome to the Aris Water Solutions fourth quarter 2022 earnings call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, David Tuerff, Senior Vice President, Finance and Investor Relations for Aris Water Solutions. Thank you. You may begin.

David Tuerff

Good morning, and welcome to the Aris Water Solutions fourth quarter 2022 earnings conference call. I am joined today by our President and CEO, Amanda Brock; our Founder and Executive Chairman, Bill Zartler; and our CFO, Stephan Tompsett.

Before we begin, I’d like to remind you that in this call and the related presentation, we will make forward-looking statements regarding our current beliefs, plans and expectations which are not guarantees of future performance and are subject to a number of known and unknown risks and uncertainties and other factors that could cause actual results to differ materially from results and events contemplated by such forward-looking statements. You are cautioned not to place undue reliance on forward-looking statements. Please refer to the risk factors and other cautionary statements included in our filings made from time to time with the Securities and Exchange Commission. I would also like to point out that our investor presentation in today’s conference call will contain discussion of non-GAAP financial measures, which we believe are useful in evaluating our performance. These supplemental measures should not be considered in isolation or as a substitute for financial measures prepared in accordance with US GAAP. Reconciliations to the most directly comparable GAAP measures are included in our earnings release in the appendix of today’s companying presentation.

I’ll now turn the call over to our Founder and Executive Chairman, Bill Zartler.

Bill Zartler

Thank you, David, and thanks, everyone, for joining us this morning. 2022 marked another year of tremendous progress for the company. We grew both volume and adjusted EBITDA for the year by more than 20% over 2021. We continue to expand our footprint backed by long-term contracts with premier operators in the core of the Permian Basin. Over the course of last year, the company further established itself as a leader in water infrastructure solutions, as evidenced by our strategic comprehensive water management agreement with Chevron, and our collaborative beneficial reuse efforts alongside ConocoPhillips, ExxonMobil, and Chevron. I'm excited to continue this momentum in 2023 and well beyond. Looking at the market for ’23, we see steady growth from our largest customers, though, as several have communicated publicly, slower growth than forecasted six months ago. As our system expands and covers more ground, we also see additional contracting opportunities with our current and other operators. Capital discipline and shareholder returns remain the core priority for both us and our customers, and no one has been immune to inflationary pressure on operating and capital budgets. For us, that means steady volume growth alongside customers who have extended inventory runway in top tier dedicated acreage, which we are connected to and is reflected in our CapEx for 2023. We also believe that we are at the forefront of solutions for the beneficial reuse of produced water. We began by recycling produced water for the oil and gas industry's own water-intensive operations, and believe we can continue to expand our services into other industrial uses. Amanda will elaborate further on our position and efforts in this sector.