Waterbridge Infrastructure LLC
11/05/2026 | Press release | Distributed by Public on 11/05/2026 05:01
Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)
Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations is based on, and should be read in conjunction with, the audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the "2025 Form 10-K") and the accompanying unaudited condensed consolidated financial statements ("Financial Statements") and notes thereto in Part I, Item 1. "Financial Statements" of this Quarterly Report. The historical financial information presented reflects only the historical financial results of WaterBridge NDB Operating LLC, one of our predecessors for SEC reporting purposes, and its subsidiaries for periods prior to September 17, 2025, and to WaterBridge and its subsidiaries for periods after such date. Separate historical results of WaterBridge Equity Finance LLC, a former Delaware limited liability company ("WBEF"), our other SEC reporting predecessor, are presented following the historical financial results of the Company.
The following discussion contains "forward-looking statements" reflecting our current expectations, future plans, estimates, beliefs and assumptions concerning events and financial trends that may be outside our control and may affect our future results of operations, cash flows and financial position. Actual results and the timing of events may differ materially from those contained in these forward-looking statements due to a number of factors, which include those factors discussed below and elsewhere in this Quarterly Report, particularly in the sections titled "Part I - Item 1.A. Risk Factors" in the 2025 Form 10-K and "Cautionary Note Regarding Forward-Looking Statements," all of which are difficult to predict. In light of these risks, uncertainties and assumptions, actual results may differ materially from such forward-looking statements. We do not undertake any obligation to publicly update any forward-looking statements except as otherwise required by applicable law.
Overview
We are a leading integrated, pure-play water infrastructure company with operations predominantly in the Delaware Basin, the most prolific oil and natural gas basin in North America. We believe that our strategically located network, substantial scale and built-in operational redundancies provide a competitive advantage in attracting customers and allow us to achieve significant operating and capital efficiencies. We operate the largest produced water infrastructure network in the United States through which we provide water management solutions to E&P companies under long-term contracts, which include gathering, transporting, recycling and handling produced water. Our synergistic relationship with LandBridge, a leading Delaware Basin land management company, provides us preferential access to significant underutilized pore space in and around the Delaware Basin that is necessary to meet the E&P industry's evolving water handling needs.
We serve our customers primarily under long-term, fixed-fee contracts that contain acreage dedications or MVCs. Many of our long-term, fixed-fee contracts also include areas of mutual interest that grant us the right to provide water management solutions on any leases or oil and natural gas wells subsequently acquired or operated by a customer within a specified area. Our long-term contracts typically grant us the exclusive right to provide water management solutions for all produced water volumes from our customers' oil and natural gas wells located within the dedicated acreage, and customers are typically required to either deliver all dedicated volumes to us or pay us a fee for any diverted dedicated volumes.
Market Condition and Outlook
The global economy and the oil and natural gas industry have continued to face substantial volatility, driven by geopolitical conflicts, domestic political uncertainties, potential U.S. and foreign tariffs, evolving international trade policies and conflicts, OPEC+ production decisions, persistent elevated inflation, higher interest rates and capital costs, and continued industry consolidation. In particular, the war between the United States and Iran (the "Iran War") has driven significant commodity price and inflation volatility during 2026. Ongoing disruption in the Strait of Hormuz, a key global oil and petrochemical chokepoint, has contributed to elevated commodity prices and shipping costs. Further escalation could increase prices further, while de-escalation could cause prices to decline, and either outcome may influence E&P operators' drilling and production decisions. Given the unresolved nature of the Iran War, we cannot predict the extent or duration of related volatility or its ultimate impact on our business. Commodity price volatility directly affects E&P operators' development plans, rig counts and overall activity levels. In addition, the Federal Reserve's recent interest rate increase and a stronger U.S. dollar have increased capital costs, which may temper E&P operators' spending despite elevated oil prices.
Broader macroeconomic and policy developments and shifts in international trade policies (such as the imposition of tariffs or product restrictions) could impair our customers' ability to secure raw materials, equipment or financing. This, in turn, may reduce their operational activity within our areas of operation in the Delaware Basin. Any escalation in U.S. trade disruptions or retaliatory measures from other nations could adversely affect demand for our produced water handling and other water management services.
Despite these challenges, we believe the outlook for energy and infrastructure development, particularly within the Permian Basin, remains positive. E&P activity in the Permian Basin, including the Delaware Basin, has remained largely resilient given favorable well economics. This continued development may be aided by President Trump's various executive orders relating to energy production, which include expedited approvals for energy resource infrastructure and the removal of various impediments to the development of
domestic energy resources, including oil and gas. We believe this growth in production activity will require increased produced water handling capacity, as the volume of produced water from wells in the Delaware Basin significantly exceeds the volume of the related oil and natural gas production.
Third Quarter Results
Significant financial and operating highlights for the third quarter of 2026 include:
•
Revenues of $240.2 million, an increase of 95% as compared to the third quarter of 2025;
•
Net income of $13.3 million, an increase of 180% as compared to the third quarter of 2025;
•
Net income margin of 6% compared to 4% in the third quarter of 2025;
•
Adjusted EBITDA(1) of $124.2 million, an increase of 112% as compared to the third quarter of 2025;
•
Adjusted EBITDA Margin(1) of 52%, an increase of 9% as compared to the third quarter of 2025;
•
Gross Margin of $62.7 million, an increase of 79% as compared to the third quarter of 2025;
•
Adjusted Operating Margin(1) of $131.8 million, an increase of 104% as compared to the third quarter of 2025;
•
Total produced water handling volumes(2) of 2,752 MBbl per day, an increase of 82% as compared to the third quarter of 2025; and
•
Total water solutions volumes of 334 MBbl per day, an increase of 21% as compared to the third quarter of 2025.
(1)
Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Operating Margin are non-GAAP financial measures. Refer to "Non-GAAP Financial Measures" for more information regarding these non-GAAP financial measures and reconciliations to the most comparable GAAP measures.
(2)
Total produced water handling volumes exclude skim oil volumes.
Results of Operations
Three Months Ended September 30, 2026 Compared to Three Months Ended September 30, 2025
WaterBridge Infrastructure LLC
|
Three Months Ended |
Amount of |
Percentage |
||||||||||||||
|
(in thousands) |
2026 |
2025 |
(Decrease) |
Change |
||||||||||||
|
Revenues: |
||||||||||||||||
|
Produced water handling |
$ |
216,955 |
$ |
111,375 |
$ |
105,580 |
95 |
% |
||||||||
|
Water solutions |
9,162 |
10,415 |
(1,253 |
) |
(12 |
)% |
||||||||||
|
Other revenues |
14,046 |
1,460 |
12,586 |
862 |
% |
|||||||||||
|
Total revenues |
240,163 |
123,250 |
116,913 |
95 |
% |
|||||||||||
|
Direct operating costs |
100,362 |
58,229 |
42,133 |
72 |
% |
|||||||||||
|
Depreciation, depletion, amortization and accretion |
77,132 |
30,026 |
47,106 |
157 |
% |
|||||||||||
|
Total cost of revenues |
177,494 |
88,255 |
89,239 |
101 |
% |
|||||||||||
|
General and administrative expense |
18,549 |
9,004 |
9,545 |
106 |
% |
|||||||||||
|
Other operating expense, net |
2,808 |
2,297 |
511 |
22 |
% |
|||||||||||
|
Operating income |
41,312 |
23,694 |
17,618 |
74 |
% |
|||||||||||
|
Interest expense, net |
26,329 |
19,335 |
6,994 |
36 |
% |
|||||||||||
|
Other expense (income), net |
71 |
(31 |
) |
102 |
(329 |
)% |
||||||||||
|
Income before income taxes |
14,912 |
4,390 |
10,522 |
240 |
% |
|||||||||||
|
Income tax expense (benefit) |
1,584 |
(366 |
) |
1,950 |
(533 |
)% |
||||||||||
|
Net income |
$ |
13,328 |
$ |
4,756 |
$ |
8,572 |
180 |
% |
||||||||
Operating Metrics
The amount of revenue we generate depends primarily on the volumes of water that we handle for, sell to or transfer for our customers.
The table below provides operational and financial data by revenue stream for the periods indicated.
|
Three Months Ended |
Amount of |
Percentage |
||||||||||||||
|
2026 |
2025 |
(Decrease) |
Change |
|||||||||||||
|
Volumes: (MBbl/d) |
||||||||||||||||
|
Produced water handling (1) |
2,752 |
1,513 |
1,239 |
82 |
% |
|||||||||||
|
Water solutions |
||||||||||||||||
|
Recycled produced water |
272 |
226 |
46 |
20 |
% |
|||||||||||
|
Brackish water |
62 |
50 |
12 |
24 |
% |
|||||||||||
|
Total water solutions |
334 |
276 |
58 |
21 |
% |
|||||||||||
|
Total |
3,086 |
1,789 |
1,297 |
72 |
% |
|||||||||||
|
Operating metrics: ($/Bbl) (2) |
||||||||||||||||
|
Produced water handling |
$ |
0.85 |
$ |
0.81 |
$ |
0.04 |
5 |
% |
||||||||
|
Water solutions |
$ |
0.30 |
$ |
0.41 |
$ |
(0.11 |
) |
(27 |
)% |
|||||||
|
Total revenues (3) |
$ |
0.80 |
$ |
0.74 |
$ |
0.06 |
8 |
% |
||||||||
|
Direct operating costs |
$ |
0.35 |
$ |
0.35 |
$ |
- |
0 |
% |
||||||||
|
Gross margin (4) |
$ |
0.22 |
$ |
0.21 |
$ |
0.01 |
5 |
% |
||||||||
|
Adjusted Operating Margin (5) |
$ |
0.46 |
$ |
0.39 |
$ |
0.07 |
18 |
% |
||||||||
(1)
Produced water handling volumes exclude skim oil volumes.
(2)
Operating metrics ($/Bbl) are calculated independently. Therefore, the sum of individual amounts may not equal the total presented due to rounding.
(3)
Total revenues ($/Bbl) exclude Other revenues.
(4)
Gross margin ($/Bbl) is calculated as Total revenues less Total cost of revenues.
(5)
Adjusted Operating Margin ($/Bbl) is a non-GAAP financial measure. Refer to "Non-GAAP Financial Measures" for more information regarding these non-GAAP financial measures and reconciliations to the most comparable GAAP measures.
The table below provides operational and financial data related to skim oil volumes recovered for the periods indicated.
|
Three Months Ended |
Amount of |
Percentage |
||||||||||||||
|
2026 |
2025 |
(Decrease) |
Change |
|||||||||||||
|
Skim oil volumes (Bbl/d) |
2,740 |
1,668 |
1,072 |
64 |
% |
|||||||||||
|
Skim oil realization (1) |
0.10 |
% |
0.11 |
% |
(0.01 |
)% |
(9 |
)% |
||||||||
|
Skim oil realized price ($/Bbl) (2) |
$ |
84.24 |
$ |
59.04 |
$ |
25.20 |
43 |
% |
||||||||
(1)
Skim oil realization is calculated as skim oil volumes divided by produced water handling volumes.
(2)
Realized skim oil pricing is net of certain industry customary deductions.
Revenues
Produced Water Handling Revenues
The table below provides financial data by produced water handling revenue stream and related unit prices for the periods indicated.
|
Three Months Ended |
Amount of |
Percentage |
||||||||||||||
|
Revenues (in thousands): |
2026 |
2025 |
(Decrease) |
Change |
||||||||||||
|
Produced water handling revenues |
$ |
195,717 |
$ |
102,314 |
$ |
93,403 |
91 |
% |
||||||||
|
Skim oil revenues |
21,238 |
9,061 |
12,177 |
134 |
% |
|||||||||||
|
Total produced water handling revenues |
$ |
216,955 |
$ |
111,375 |
$ |
105,580 |
95 |
% |
||||||||
|
Unit prices: ($/Bbl) |
||||||||||||||||
|
Produced water handling revenues |
$ |
0.77 |
$ |
0.74 |
$ |
0.03 |
4 |
% |
||||||||
|
Skim oil revenues (1) |
$ |
0.08 |
$ |
0.07 |
$ |
0.01 |
14 |
% |
||||||||
|
Total produced water handling revenues |
$ |
0.85 |
$ |
0.81 |
$ |
0.04 |
5 |
% |
||||||||
(1)
Skim oil unit price is calculated as skim oil revenue divided by produced water handling volumes.
Produced water handling revenues increased $105.6 million for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025 primarily due to:
•
an increase of $24.5 million due to a 362 MBbl/d volume increase driven primarily by continued development and organic commercial growth and completion activity across the Stateline area. Additionally, there was an increase of $8.1 million related to higher realized unit prices for produced water volumes handled due to composition of customer volume and contracts; and
•
an increase of $5.0 million in skim oil revenues primarily due to a $3.9 million increase related to higher commodity prices and $1.1 million related to higher produced water handling volume with a lower skim oil recovery rate per barrel; and
•
an increase of $57.6 million due to an 877 MBbl/d volume increase and $3.2 million due to higher realized unit prices for produced water volumes handled attributable to the WaterBridge Combination; and
•
an increase of $7.2 million in skim oil revenues primarily due to a $4.8 million increase related to higher produced water handling volume with a lower skim oil recovery rate per barrel due to higher untreated recycled water volumes and a $2.4 million increase due to higher commodity prices attributable to the WaterBridge Combination.
Water Solutions Revenues
Water solutions revenues decreased $1.3 million for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025 primarily due to:
•
a decrease of $0.5 million due to a 97 MBbl/d treated water volume decrease partially offset by an 80 MBbl/d untreated water volume increase. The overall volume decrease was primarily attributable to lower demand for treated recycled water used in conjunction with upstream drilling and completion activity. Additionally, there was a decrease of $2.7 million related to recycled water realized unit price attributable to lower treated recycled water sales; and
•
an increase of $1.0 million due to a 15 MBbl/d brackish water volume increase related to higher customer demand; and
•
an increase of $1.0 million due to a 64 MBbl/d untreated water volume increase attributable to higher demand for untreated recycled water used in conjunction with upstream drilling and completion activity attributable to the WaterBridge Combination.
Other revenues. Other revenues increased $12.6 million for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025 due to $8.5 million of energy waste management revenue and $0.7 million of gas transport revenue attributable to the WaterBridge Combination. Additionally, other revenues include $3.4 million of energy waste management revenues associated with the OWL Landfill Services LLC ("NDB Landfill") acquisition.
Direct operating costs. Direct operating costs increased $42.1 million for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025 of which $28.3 million is attributable to the WaterBridge Combination. The remaining increase of $13.8 million was primarily attributable to an increase of $11.9 million due to higher produced water handling volumes related to organic commercial growth, $0.4 million related to various operating expenses due to a nominal direct operating cost per barrel increase of less than $0.01/bbl and $1.5 million related to the NDB Landfill acquisition.
Depreciation, depletion, amortization and accretion. Depreciation, depletion, amortization and accretion increased $47.1 million for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025. The increase is primarily attributable to $37.9 million in depreciation, amortization and depletion expense associated with property, plant and equipment and intangible assets acquired in the WaterBridge Combination and $7.3 million in depreciation expense related to continued high levels of capital investment activity in produced water handling infrastructure subsequent to September 30, 2025.
|
Three Months Ended |
Amount of |
Percentage |
||||||||||||||
|
2026 |
2025 |
(Decrease) |
Change |
|||||||||||||
|
General and administrative expense, excluding share-based compensation expense |
$ |
15,833 |
$ |
7,880 |
$ |
7,953 |
101 |
% |
||||||||
|
Share-based compensation expense |
2,716 |
1,124 |
1,592 |
142 |
% |
|||||||||||
|
Total general and administrative expense |
$ |
18,549 |
$ |
9,004 |
$ |
9,545 |
106 |
% |
||||||||
General and administrative expense. General and administrative expense, excluding share-based compensation expense, increased $8.0 million for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025. The increase was primarily attributable to higher personnel-related expenses of $10.1 million, IT and facility expenses of $1.7 million, professional services for tax, audit, compliance and legal of $1.5 million, and other expenses of $1.3 million. These increases were partially offset by lower allocation of corporate shared services costs of $6.5 million. As a result of the WaterBridge Combination, the Company incurred significant direct costs, whereas prior to the WaterBridge Combination the Company received the majority of its general and administrative expenses through a corporate shared service allocation.
Share-based compensation expense. Share-based compensation expense increased $1.6 million for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025. The increase is primarily attributable to amortization of $2.0 million related to restricted share units ("RSUs") attributable to awards issued in connection with the Company's initial public offering ("IPO") in September 2025, partially offset by decreased amortization of $0.4 million related to vested NDB Incentive Units.
|
Three Months Ended |
Amount of |
Percentage |
||||||||||||||
|
2026 |
2025 |
(Decrease) |
Change(1) |
|||||||||||||
|
Interest on debt |
$ |
26,669 |
$ |
18,036 |
$ |
8,633 |
48 |
% |
||||||||
|
Amortization of debt issuance costs |
1,157 |
1,241 |
(84 |
) |
(7 |
)% |
||||||||||
|
Commitment fees |
444 |
108 |
336 |
311 |
% |
|||||||||||
|
Total interest cost |
28,270 |
19,385 |
8,885 |
46 |
% |
|||||||||||
|
Interest income |
(156 |
) |
(50 |
) |
(106 |
) |
212 |
% |
||||||||
|
Capitalized interest |
(1,785 |
) |
- |
(1,785 |
) |
NM |
||||||||||
|
Total interest expense, net |
$ |
26,329 |
$ |
19,335 |
$ |
6,994 |
36 |
% |
||||||||
(1)
NM - Not meaningful
Interest expense, net. Interest expense, net, increased $7.0 million for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025 primarily attributable to higher interest of $29.1 million attributable to a higher weighted average debt balance of $1,042.1 million, partially offset by lower interest of $20.7 million attributable to a lower weighted average interest rate as a result of the debt refinancing completed in October 2025. Additionally, capitalized interest increased $1.8 million in connection with the development of Speedway Phase I produced water handling infrastructure projects.
Income tax expense (benefit). Income tax expense increased $2.0 million to expense of $1.6 million for the three months ended September 30, 2026 as compared to a benefit of $0.4 million for the three months ended September 30, 2025, primarily related to higher taxable income in 2026 attributable to the Company due to a full quarter as a taxable entity and the timing of the WaterBridge Combination in 2025.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
WaterBridge Infrastructure LLC
|
Nine Months Ended |
Amount of |
Percentage |
||||||||||||||
|
(in thousands) |
2026 |
2025 |
(Decrease) |
Change |
||||||||||||
|
Revenues: |
||||||||||||||||
|
Produced water handling |
$ |
596,523 |
$ |
285,596 |
$ |
310,927 |
109 |
% |
||||||||
|
Water solutions |
27,494 |
28,388 |
(894 |
) |
(3 |
)% |
||||||||||
|
Other revenues |
34,895 |
2,688 |
32,207 |
1,198 |
% |
|||||||||||
|
Total revenues |
658,912 |
316,672 |
342,240 |
108 |
% |
|||||||||||
|
Direct operating costs |
271,749 |
149,049 |
122,700 |
82 |
% |
|||||||||||
|
Depreciation, depletion, amortization and accretion |
218,179 |
72,212 |
145,967 |
202 |
% |
|||||||||||
|
Total cost of revenues |
489,928 |
221,261 |
268,667 |
121 |
% |
|||||||||||
|
General and administrative expense |
53,042 |
23,179 |
29,863 |
129 |
% |
|||||||||||
|
(Gain) loss on disposal of assets, net |
(97 |
) |
11,832 |
(11,929 |
) |
(101 |
)% |
|||||||||
|
Other operating expense, net |
4,003 |
3,821 |
182 |
5 |
% |
|||||||||||
|
Operating income |
112,036 |
56,579 |
55,457 |
98 |
% |
|||||||||||
|
Interest expense, net |
69,029 |
43,560 |
25,469 |
58 |
% |
|||||||||||
|
Other expense (income), net |
753 |
(296 |
) |
1,049 |
(354 |
)% |
||||||||||
|
Income before income taxes |
42,254 |
13,315 |
28,939 |
217 |
% |
|||||||||||
|
Income tax expense (benefit) |
4,850 |
(277 |
) |
5,127 |
(1,851 |
)% |
||||||||||
|
Net income |
$ |
37,404 |
$ |
13,592 |
$ |
23,812 |
175 |
% |
||||||||
Operating Metrics
The amount of revenue we generate depends primarily on the volumes of water that we handle for, sell to or transfer for our customers.
The table below provides operational and financial data by revenue stream for the periods indicated.
|
Nine Months Ended |
Amount of |
Percentage |
||||||||||||||
|
2026 |
2025 |
(Decrease) |
Change |
|||||||||||||
|
Volumes: (MBbl/d) |
||||||||||||||||
|
Produced water handling (1) |
2,604 |
1,309 |
1,295 |
99 |
% |
|||||||||||
|
Water solutions |
||||||||||||||||
|
Recycled produced water |
273 |
235 |
38 |
16 |
% |
|||||||||||
|
Brackish water |
50 |
52 |
(2 |
) |
(4 |
)% |
||||||||||
|
Total water solutions |
323 |
287 |
36 |
13 |
% |
|||||||||||
|
Total |
2,927 |
1,596 |
1,331 |
83 |
% |
|||||||||||
|
Operating metrics: ($/Bbl) (2) |
||||||||||||||||
|
Produced water handling |
$ |
0.84 |
$ |
0.80 |
$ |
0.04 |
5 |
% |
||||||||
|
Water solutions |
$ |
0.31 |
$ |
0.36 |
$ |
(0.05 |
) |
(14 |
)% |
|||||||
|
Total revenues (3) |
$ |
0.78 |
$ |
0.72 |
$ |
0.06 |
8 |
% |
||||||||
|
Direct operating costs |
$ |
0.34 |
$ |
0.34 |
$ |
- |
0 |
% |
||||||||
|
Gross margin (4) |
$ |
0.21 |
$ |
0.22 |
$ |
(0.01 |
) |
(5 |
)% |
|||||||
|
Adjusted Operating Margin (5) |
$ |
0.46 |
$ |
0.38 |
$ |
0.08 |
21 |
% |
||||||||
(1)
Produced water handling volumes exclude skim oil volumes.
(2)
Operating metrics ($/Bbl) are calculated independently. Therefore, the sum of individual amounts may not equal the total presented due to rounding.
(3)
Total revenues ($/Bbl) exclude Other revenues.
(4)
Gross margin ($/Bbl) is calculated as Total revenues less Total cost of revenues.
(5)
Adjusted Operating Margin ($/Bbl) is a non-GAAP financial measure. Refer to "Non-GAAP Financial Measures" for more information regarding these non-GAAP financial measures and reconciliations to the most comparable GAAP measures.
The table below provides operational and financial data related to skim oil volumes recovered for the periods indicated.
|
Nine Months Ended |
Amount of |
Percentage |
||||||||||||||
|
2026 |
2025 |
(Decrease) |
Change |
|||||||||||||
|
Skim oil volumes (Bbl/d) |
2,560 |
1,553 |
1,007 |
65 |
% |
|||||||||||
|
Skim oil realization (1) |
0.10 |
% |
0.12 |
% |
(0.02 |
)% |
(17 |
)% |
||||||||
|
Skim oil realized price ($/Bbl) (2) |
$ |
83.44 |
$ |
59.96 |
$ |
23.48 |
39 |
% |
||||||||
(1)
Skim oil realization is calculated as skim oil volumes divided by produced water handling volumes.
(2)
Realized skim oil pricing is net of certain industry customary deductions.
Revenues
Produced Water Handling Revenues
The table below provides financial data by produced water handling revenue stream and related unit prices for the periods indicated.
|
Nine Months Ended |
Amount of |
Percentage |
||||||||||||||
|
Revenues (in thousands): |
2026 |
2025 |
(Decrease) |
Change |
||||||||||||
|
Produced water handling revenues |
$ |
538,212 |
$ |
260,176 |
$ |
278,036 |
107 |
% |
||||||||
|
Skim oil revenues |
58,311 |
25,420 |
32,891 |
129 |
% |
|||||||||||
|
Total produced water handling revenues |
$ |
596,523 |
$ |
285,596 |
$ |
310,927 |
109 |
% |
||||||||
|
Unit prices: ($/Bbl) |
||||||||||||||||
|
Produced water handling revenues |
$ |
0.76 |
$ |
0.73 |
$ |
0.03 |
4 |
% |
||||||||
|
Skim oil revenues (1) |
$ |
0.08 |
$ |
0.07 |
$ |
0.01 |
14 |
% |
||||||||
|
Total produced water handling revenues |
$ |
0.84 |
$ |
0.80 |
$ |
0.04 |
5 |
% |
||||||||
(1)
Skim oil unit price is calculated as skim oil revenue divided by produced water handling volumes.
Produced water handling revenues increased $310.9 million for the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025 primarily due to:
•
an increase of $64.1 million due to a 322 MBbl/d volume increase, driven primarily by continued development and organic commercial growth and completion activity across the Stateline area. Additionally, there was an increase of $13.6 million related to higher realized unit prices for produced water volumes handled related to composition of customer volume and contracts; and
•
an increase of $12.8 million in skim oil revenues primarily due to a $10.2 million increase related to higher commodity prices and $2.5 million related to higher produced water handling volume with a lower skim oil recovery rate per barrel; and
•
an increase of $189.5 million due to a 973 MBbl/d volume increase and an increase of $10.8 million due to higher realized unit prices for produced water volumes handled related to composition of customer volume and contracts attributable to the WaterBridge Combination; and
•
an increase of $20.1 million in skim oil revenues primarily due to a $14.1 million increase related to higher produced water handling volume with a lower skim oil recovery rate per barrel and a $6.0 million increase related to higher commodity prices attributable to the WaterBridge Combination.
Water Solutions Revenues
Water solutions revenues decreased $0.9 million for the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025 primarily due to:
•
an increase of $1.0 million due to a 1 MBbl/d treated water volume increase and an 11 MBbl/d untreated water volume increase. The overall volume increase was primarily attributable to higher demand for treated recycled water used in conjunction with upstream drilling and completion activity. This was partially offset by a decrease of $1.5 million related to recycled water realized unit price attributable to a lower weighting of treated versus untreated recycled water sales volumes and a change in customer mix; and
•
a decrease of $0.8 million due to a 4 MBbl/d brackish water volume decrease related to brackish water supply assets acquired in May 2024 and a decrease of $0.6 million related to lower realized unit prices for brackish water; and
•
an increase of $1.2 million due to a 24 MBbl/d untreated water volume increase attributable to higher demand for untreated recycled water used in conjunction with upstream drilling and completion activity. This was partially offset by a decrease of $0.2 million related to recycled water realized unit price attributable to a change in customer mix. This net $1.0 million increase is attributable to the WaterBridge Combination.
Other revenues. Other revenues increased $32.2 million for the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025 due to $27.2 million of energy waste management revenue and $2.7 million of gas transport revenue attributable to the WaterBridge Combination partially offset by a decrease of $1.1 million related to the divestment of crude gathering and transportation assets in March 2025. Additionally, other revenues include $3.4 million of energy waste management revenues associated with the NDB Landfill acquisition.
Direct operating costs. Direct operating costs increased $122.7 million for the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025 of which $89.1 million is due to the WaterBridge Combination. The remaining increase of $33.6 million was primarily attributable to an increase of $31.1 million due to higher produced water handling and water solution volumes related to organic commercial growth, $1.0 million related to various operating expenses due to a nominal direct operating cost per barrel increase of less than $0.01/bbl and $1.5 million related to the NDB Landfill acquisition.
Depreciation, depletion, amortization and accretion. Depreciation, depletion, amortization and accretion increased $146.0 million for the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025. The increase is primarily attributable to $128.3 million in depreciation, amortization and depletion expense associated with property, plant and equipment and intangible assets acquired in the WaterBridge Combination and $15.1 million in depreciation expense related to continued high levels of capital investment activity in produced water handling infrastructure subsequent to September 30, 2025.
|
Nine Months Ended |
Amount of |
Percentage |
||||||||||||||
|
2026 |
2025 |
(Decrease) |
Change |
|||||||||||||
|
General and administrative expense, excluding share-based compensation expense |
$ |
45,537 |
$ |
20,771 |
$ |
24,766 |
119 |
% |
||||||||
|
Share-based compensation expense |
7,505 |
2,408 |
5,097 |
212 |
% |
|||||||||||
|
Total general and administrative expense |
$ |
53,042 |
$ |
23,179 |
$ |
29,863 |
129 |
% |
||||||||
General and administrative expense. General and administrative expense, excluding share-based compensation expense, increased by $24.8 million for the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025. The increase was primarily attributable to higher personnel-related expenses of $31.3 million, professional services for tax, audit, compliance and legal of $5.3 million, IT and facility expenses of $5.0 million and insurance and other corporate expenses of $4.2 million. These increases were partially offset by lower allocation of corporate shared services costs of $21.0 million. As a result of the WaterBridge Combination, the Company incurred significant direct costs, whereas prior to the WaterBridge Combination the Company received the majority of its general and administrative expenses through a corporate shared service allocation.
Share-based compensation expense. Share-based compensation expense increased $5.1 million for the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025. The increase is primarily attributable to amortization of $5.2 million related to RSUs due to awards issued after the Company's IPO in September 2025.
(Gain) loss on disposal of assets, net. (Gain) loss on disposal of assets decreased $11.9 million primarily due to the sale of crude gathering and transportation assets during the nine months ended September 30, 2025 as compared to no such material sales of assets during the nine months ended September 30, 2026.
|
Nine Months Ended |
Amount of |
Percentage |
||||||||||||||
|
2026 |
2025 |
(Decrease) |
Change |
|||||||||||||
|
Interest on debt |
$ |
74,175 |
$ |
44,038 |
$ |
30,137 |
68 |
% |
||||||||
|
Amortization of debt issuance costs |
3,227 |
3,379 |
(152 |
) |
(4 |
)% |
||||||||||
|
Commitment fees |
1,416 |
253 |
1,163 |
460 |
% |
|||||||||||
|
Total interest cost |
78,818 |
47,670 |
31,148 |
65 |
% |
|||||||||||
|
Interest income |
(582 |
) |
(50 |
) |
(532 |
) |
1064 |
% |
||||||||
|
Capitalized interest |
(9,207 |
) |
(4,060 |
) |
(5,147 |
) |
127 |
% |
||||||||
|
Total interest expense, net |
$ |
69,029 |
$ |
43,560 |
$ |
25,469 |
58 |
% |
||||||||
Interest expense, net. Interest expense, net, increased $25.5 million for the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025 primarily attributable to higher interest of $66.2 million due to a higher weighted average debt balance of $938.2 million, partially offset by lower interest of $36.7 million due to a lower weighted average interest rate as a result of the debt refinancing completed in October 2025. Additionally, capitalized interest increased $5.1 million related to the development of Speedway Phase I produced water handling infrastructure projects.
Income tax expense (benefit). Income tax expense increased $5.2 million to an expense of $4.9 million for the nine months ended September 30, 2026 as compared to a benefit of $0.3 million for the nine months ended September 30, 2025, primarily related to higher taxable income in 2026 attributable to the Company due to a full nine months as a taxable entity and the timing of the WaterBridge Combination in 2025.
The Periods July 1, 2025 through September 16, 2025 and January 1, 2025 through September 16, 2025
WaterBridge Equity Finance LLC
|
(in thousands) |
For the Period July 1, 2025 through September 16, 2025 |
For the Period January 1, 2025 through September 16, 2025 |
||||||
|
Revenues: |
||||||||
|
Produced water handling |
$ |
73,457 |
$ |
229,353 |
||||
|
Water solutions |
1,309 |
8,327 |
||||||
|
Other revenues |
1,533 |
4,954 |
||||||
|
Total revenues |
76,299 |
242,634 |
||||||
|
Direct operating costs |
29,270 |
92,785 |
||||||
|
Depreciation, amortization and accretion |
23,676 |
82,974 |
||||||
|
Total cost of revenues |
52,946 |
175,759 |
||||||
|
General and administrative (income) expense |
(17,262 |
) |
1,678 |
|||||
|
Other operating expense, net |
3,182 |
4,810 |
||||||
|
Operating income |
37,433 |
60,387 |
||||||
|
Interest expense, net |
25,369 |
79,710 |
||||||
|
Other income, net |
(884 |
) |
(2,421 |
) |
||||
|
Income (loss) from operations before taxes |
12,948 |
(16,902 |
) |
|||||
|
Income tax benefit |
(11 |
) |
(40 |
) |
||||
|
Net income (loss) |
$ |
12,959 |
$ |
(16,862 |
) |
|||
Operating Metrics
The amount of revenue we generate depends primarily on the volumes of water that we handle for, sell to or transfer for our customers.
The table below provides operational and financial data by revenue stream for the periods indicated.
|
For the Period July 1, 2025 through September 16, 2025 |
For the Period January 1, 2025 through September 16, 2025 |
|||||||
|
Volumes: (MBbl/d) |
||||||||
|
Produced water handling (1) |
1,206 |
1,144 |
||||||
|
Water solutions |
||||||||
|
Recycled produced water |
22 |
57 |
||||||
|
Brackish water |
20 |
21 |
||||||
|
Total water solutions |
42 |
78 |
||||||
|
Total |
1,248 |
1,222 |
||||||
|
Operating metrics: ($/Bbl) (2) |
||||||||
|
Produced water handling |
$ |
0.78 |
$ |
0.77 |
||||
|
Water solutions |
$ |
0.40 |
$ |
0.41 |
||||
|
Total revenues (3) |
$ |
0.77 |
$ |
0.75 |
||||
|
Direct operating costs |
$ |
0.30 |
$ |
0.29 |
||||
|
Gross margin (4) |
$ |
0.24 |
$ |
0.21 |
||||
(1)
Produced water handling volumes exclude skim oil volumes.
(2)
Operating metrics ($/Bbl) are calculated independently. Therefore, the sum of individual amounts may not equal the total presented due to rounding.
(3)
Total revenues ($/Bbl) exclude Other revenues.
(4)
Gross margin ($/Bbl) is calculated as Total revenues less Total cost of revenues.
The table below provides operational and financial data related to skim oil volumes recovered for the periods indicated.
|
For the Period July 1, 2025 through September 16, 2025 |
For the Period January 1, 2025 through September 16, 2025 |
|||||||
|
Skim oil volumes (Bbl/d) |
1,398 |
1,165 |
||||||
|
Skim oil realization (1) |
0.12 |
% |
0.10 |
% |
||||
|
Skim oil realized price ($/Bbl) (2) |
$ |
62.63 |
$ |
63.45 |
||||
(1)
Skim oil realization is calculated as skim oil revenue divided by produced water handling volumes.
(2)
Realized skim oil pricing is net of certain industry customary deductions.
Revenues
Produced Water Handling Revenues
The table below provides financial data by produced water handling revenue stream and related unit prices for the periods indicated.
|
Revenues (in thousands): |
For the Period July 1, 2025 through September 16, 2025 |
For the Period January 1, 2025 through September 16, 2025 |
||||||
|
Produced water handling revenues |
$ |
66,628 |
$ |
210,208 |
||||
|
Skim oil revenues |
6,829 |
19,145 |
||||||
|
Total produced water handling revenues |
$ |
73,457 |
$ |
229,353 |
||||
|
Unit prices: ($/Bbl) |
||||||||
|
Produced water handling revenues |
$ |
0.71 |
$ |
0.71 |
||||
|
Skim oil revenues (1) |
$ |
0.07 |
$ |
0.06 |
||||
|
Total produced water handling revenues |
$ |
0.78 |
$ |
0.77 |
||||
(1)
Skim oil unit price is calculated as skim oil revenue divided by produced water handling volumes.
Produced water handling revenues for the period July 1, 2025 through September 16, 2025 consisted of:
•
$66.6 million of produced water handling revenues attributable to produced water handling volumes of 1,206 MBbl/d and a realized unit price per barrel of $0.71; and
•
$6.8 million of skim oil revenues attributable to skim oil volume of 1.4 MBbl/d and a realized unit price per barrel of $62.63.
Produced water handling revenues for the period January 1, 2025 through September 16, 2025 consisted of:
•
$210.2 million of produced water handling revenues attributable to produced water handling volumes of 1,144 MBbl/d and a realized unit price per barrel of $0.71; and
•
$19.1 million of skim oil revenues attributable to skim oil volume of 1.2 MBbl/d and a realized unit price per barrel of $63.45.
Water Solutions Revenues
Water solutions revenues for the period July 1, 2025 through September 16, 2025 consisted of:
•
$0.6 million of recycled water revenues attributable to treated and untreated recycled water of 22 MBbl/d and a realized unit price per barrel of $0.33; and
•
$0.7 million of brackish water revenues attributable to brackish water volume of 20 MBbl/d and a realized unit price per barrel of $0.48.
Water solutions revenues for the period January 1, 2025 through September 16, 2025 consisted of:
•
$5.2 million of recycled water revenues attributable to treated and untreated recycled water of 57 MBbl/d and a realized unit price per barrel of $0.35; and
•
$3.1 million of brackish water revenues attributable to brackish water volume of 21 MBbl/d and a realized unit price per barrel of $0.58.
Other revenues. Other revenues for the periods from July 1, 2025 through September 16, 2025, and from January 1, 2025 through September 16, 2025 were primarily attributable to $1.5 million and $5.0 million, respectively, in gas transportation revenues.
Direct operating costs. Direct operating costs for the period July 1, 2025 through September 16, 2025 were attributable to site utilities and power of $5.9 million, repairs and maintenance of $4.9 million, royalty expense of $4.0 million, personnel-related expenses of $3.7 million, costs related to sales of brackish water of $3.2 million, insurance and property taxes of $2.4 million, chemicals and well intervention of $2.2 million and other expenses of $3.1 million. Direct operating costs for the period January 1, 2025 through September 16, 2025 were attributable to site utilities and power of $17.1 million, repairs and maintenance of $13.3 million, royalty expense of $12.7 million, personnel-related expenses of $12.2 million, chemicals and well intervention of $10.4 million, insurance and property taxes of $7.8 million, waste disposal and trucking expenses of $7.3 million, costs related to sales of brackish water of $3.6 million, equipment rental of $3.2 million, and other expenses of $5.2 million.
Depreciation, amortization and accretion. Depreciation, amortization and accretion expense for the period July 1, 2025 through September 16, 2025 consisted of $20.5 million of depreciation expense related to straight-line depreciation of property, plant and equipment, $2.9 million of amortization expense related to amortization of intangible assets and $0.3 million of accretion expense related to asset retirement obligations. Depreciation, amortization and accretion expense for the period January 1, 2025 through September 16, 2025 consisted of $72.3 million of depreciation expense related to straight-line depreciation of property, plant and equipment, $9.9 million of amortization expense related to amortization of intangible assets and $0.8 million of accretion expense related to asset retirement obligations.
|
For the Period July 1, 2025 through September 16, 2025 |
For the Period January 1, 2025 through September 16, 2025 |
|||||||
|
General and administrative expense, excluding share-based compensation benefit |
$ |
5,515 |
$ |
17,059 |
||||
|
Share-based compensation benefit |
(22,777 |
) |
(15,381 |
) |
||||
|
Total general and administrative (income) expense |
$ |
(17,262 |
) |
$ |
1,678 |
|||
General and administrative expense. General and administrative expense, excluding share-based compensation expense for the period July 1, 2025 through September 16, 2025 consisted of $8.4 million of direct employee-related expenses, $1.8 million of office facility and IT-related expenses, $0.6 million of professional services fees primarily related to audit and tax services and $0.6 million of other general and administrative expenses partially offset by corporate shared services allocation to other related operating entities of $5.9 million. General and administrative expense, excluding share-based compensation expense for the period January 1, 2025 through September 16, 2025 consisted of $27.7 million of direct employee-related expenses, $5.6 million of office facility and IT-related expenses, $1.9 million of professional services fees primarily related to audit and tax services and $2.3 million of other general and administrative expenses partially offset by corporate shared services allocation to other related operating entities of $20.4 million.
Share-based compensation benefit. Share-based compensation resulted in a net benefit of $22.8 million and $15.4 million for the periods from July 1, 2025 through September 16, 2025, and from January 1, 2025 through September 16, 2025, respectively, consisted of reflected fair value remeasurements of Incentive Units in WaterBridge Resources LLC and WaterBridge II LLC that are accounted for as liability awards.
Other operating expense, net. Other operating expense, net of $3.2 million and $4.8 million for the periods from July 1, 2025 through September 16, 2025, and from January 1, 2025 through September 16, 2025, respectively, consisted primarily of acquisition-related costs associated with the WaterBridge Combination.
Interest expense, net. Interest expense, net, for the periods from July 1, 2025 through September 16, 2025, and from January 1, 2025 through September 16, 2025 were attributable to the following:
|
For the Period July 1, 2025 through September 16, 2025 |
For the Period January 1, 2025 through September 16, 2025 |
|||||||
|
Interest expense on credit facilities |
$ |
23,432 |
$ |
75,695 |
||||
|
Amortization of debt issuance costs |
1,934 |
6,528 |
||||||
|
Commitment fees |
85 |
335 |
||||||
|
Interest on other |
105 |
483 |
||||||
|
Total interest cost |
25,556 |
83,041 |
||||||
|
Interest income |
(187 |
) |
(667 |
) |
||||
|
Capitalized interest on credit facilities |
- |
(2,664 |
) |
|||||
|
Total interest expense, net |
$ |
25,369 |
$ |
79,710 |
||||
The weighted average interest rates during the periods from July 1, 2025 through September 16, 2025, and from January 1, 2025 through September 16, 2025 were 9.31% and 9.14%, respectively, and the weighted average debt balance was $1.1 billion as of September 16, 2025, attributable entirely to our term loan.
Non-GAAP Financial Measures
We use certain non-GAAP performance measures to evaluate current and past performance and prospects for the future to supplement our financial information presented in accordance with GAAP. Although these non-GAAP financial measures are important factors in assessing our operating results and profitability, they should not be considered in isolation or as a substitute for net income or gross margin or any other measures presented under GAAP.
Management believes Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Operating Margin and Adjusted Operating Margin per Barrel (each as defined below) are useful because they allow us to more effectively evaluate our operating performance and compare the results of our operations from period to period, and against our peers, without regard to our financing methods or capital structure.
Adjusted EBITDA and Adjusted EBITDA Margin
Adjusted EBITDA and Adjusted EBITDA Margin are used by our management and by external users of our financial statements, such as investors, research analysts and others, to assess the financial performance of our assets over the long term to generate sufficient cash to return capital to equity holders or service indebtedness. We define Adjusted EBITDA as net income before interest; taxes; depreciation, amortization, depletion and accretion; share-based compensation; non-recurring transaction-related expenses; litigation settlements and expenses incurred outside of the ordinary course of business; debt modification and extinguishment costs; gains or losses on disposal of assets; and other non-cash or non-recurring expenses. We define Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenues.
We exclude the items listed above from net income in arriving at Adjusted EBITDA and Adjusted EBITDA Margin because these amounts can vary substantially from company to company within our industry depending upon accounting methods, book values of assets, capital structures and the method by which the assets were acquired.
The following table sets forth a reconciliation of net income and net income margin as determined in accordance with GAAP to Adjusted EBITDA and Adjusted EBITDA Margin, for the periods indicated:
|
Three Months Ended |
Nine Months Ended |
|||||||||||||||
|
2026 |
2025 |
2026 |
2025 |
|||||||||||||
|
Net income |
$ |
13,328 |
$ |
4,756 |
$ |
37,404 |
$ |
13,592 |
||||||||
|
Adjustments: |
||||||||||||||||
|
Depreciation, depletion, amortization and accretion |
77,132 |
30,373 |
218,179 |
73,301 |
||||||||||||
|
Interest expense, net |
26,329 |
19,335 |
69,029 |
43,560 |
||||||||||||
|
Income tax expense (benefit) |
1,584 |
(366 |
) |
4,850 |
(277 |
) |
||||||||||
|
EBITDA |
$ |
118,373 |
$ |
54,098 |
$ |
329,462 |
$ |
130,176 |
||||||||
|
Adjustments: |
||||||||||||||||
|
Share-based compensation - RSUs |
2,380 |
214 |
5,887 |
214 |
||||||||||||
|
TRA remeasurement loss |
- |
- |
3,236 |
- |
||||||||||||
|
Transaction-related expenses(1) |
2,230 |
2,309 |
2,664 |
3,126 |
||||||||||||
|
Share-based compensation - NDB Incentive Units |
524 |
997 |
2,184 |
2,379 |
||||||||||||
|
Temporary power costs |
- |
580 |
352 |
1,014 |
||||||||||||
|
(Gain) loss on disposal of assets, net |
(31 |
) |
141 |
(97 |
) |
11,832 |
||||||||||
|
Other(2) |
770 |
386 |
(732 |
) |
1,406 |
|||||||||||
|
Adjusted EBITDA |
$ |
124,246 |
$ |
58,725 |
$ |
342,956 |
$ |
150,147 |
||||||||
|
Total revenues |
$ |
240,163 |
$ |
123,250 |
$ |
658,912 |
$ |
316,672 |
||||||||
|
Net income margin |
6 |
% |
4 |
% |
6 |
% |
4 |
% |
||||||||
|
Adjusted EBITDA Margin |
52 |
% |
48 |
% |
52 |
% |
47 |
% |
||||||||
(1)
Transaction-related expenses consist of non-capitalizable transaction costs associated with the Ranger Water Midstream LLC ("Ranger") acquisition and NDB Landfill acquisition for the three and nine months ended September 30, 2026 and, corporate reorganization and non-capitalizable initial public offering related charges for the three and nine months ended September 30, 2025.
(2)
Other consists of costs associated with the potential corporate conversion, abandoned well costs, abandoned project costs and other non-cash or non-recurring items for the three and nine months ended September 30, 2026 and abandoned well costs, abandoned project costs and other non-cash or non-recurring items for the three and nine months ended September 30, 2025.
Adjusted Operating Margin and Adjusted Operating Margin per Barrel
Adjusted Operating Margin and Adjusted Operating Margin per Barrel are dependent upon the volume of produced water we gather and handle, the volume of recycled water and brackish water we sell and transfer, the fees we charge for such services and the recurring operating expenses we incur to perform such services. We define Adjusted Operating Margin as gross margin plus depreciation, depletion, amortization and accretion excluding other revenues and cost of other revenues not associated with our produced water handling and water solution revenue streams. We define Adjusted Operating Margin per Barrel as Adjusted Operating Margin divided by total volumes handled, sold or transferred.
The following table sets forth a reconciliation of gross margin and gross margin per barrel as determined in accordance with GAAP to Adjusted Operating Margin and Adjusted Operating Margin per Barrel for the periods indicated:
|
Three Months Ended |
Nine Months Ended |
|||||||||||||||
|
(Dollars in thousands, except per barrel data) |
2026 |
2025 |
2026 |
2025 |
||||||||||||
|
Total revenues |
$ |
240,163 |
$ |
123,250 |
$ |
658,912 |
$ |
316,672 |
||||||||
|
Cost of revenues |
(177,494 |
) |
(88,255 |
) |
(489,928 |
) |
(221,261 |
) |
||||||||
|
Gross margin |
62,669 |
34,995 |
168,984 |
95,411 |
||||||||||||
|
Less: Other revenues |
(14,046 |
) |
(1,460 |
) |
(34,895 |
) |
(2,688 |
) |
||||||||
|
Less: Cost of other revenues(1) |
5,999 |
709 |
14,940 |
1,485 |
||||||||||||
|
Depreciation, depletion, amortization, and accretion |
77,132 |
30,373 |
218,179 |
73,301 |
||||||||||||
|
Adjusted Operating Margin |
$ |
131,754 |
$ |
64,617 |
$ |
367,208 |
$ |
167,509 |
||||||||
|
Total volumes(2) (MBbls) |
283,946 |
164,560 |
799,007 |
435,804 |
||||||||||||
|
Gross margin ($/Bbl) |
$ |
0.22 |
$ |
0.21 |
$ |
0.21 |
$ |
0.22 |
||||||||
|
Adjusted Operating Margin ($/Bbl) |
$ |
0.46 |
$ |
0.39 |
$ |
0.46 |
$ |
0.38 |
||||||||
(1)
Cost of other revenues includes direct operating costs associated with our environmental waste management, gas transportation and divested crude transportation services.
(2)
Total volumes exclude skim oil volumes.
Liquidity and Capital Resources
Overview
Historically, our predecessors' primary sources of liquidity have been capital contributions from their respective members, cash flows from operating activities and borrowings under their credit facilities. Following the completion of our initial public offering, our primary sources of liquidity are cash flows from operating activities and, if required, proceeds from borrowings under the 2025 Revolving Credit Facility. Our primary liquidity and capital requirements will be capital expenditures to support continued growth initiatives and the execution of major development projects, operating expenses, servicing of our debt, the payment of dividends to our shareholders, if any, and general company needs. We believe that we are able to fully fund our ongoing capital expenditures, working capital requirements and other capital needs through cash on hand and cash flows from our operating activities for at least twelve months from the date of this Quarterly Report and over the longer term. However, we may elect to use borrowings under the 2025 Revolving Credit Facility to finance our operating and investing activities in the future and may also need to raise additional capital in the future to support our operations. Refer to Note 7 - Debt within the notes to our unaudited condensed consolidated financial statements for more information.
We strive to maintain financial flexibility and proactively monitor potential capital sources, including equity and debt financing, to meet our target liquidity and capital requirements. If market conditions were to change and our revenues were to decline significantly or operating costs were to increase significantly, our cash flows and liquidity could be reduced and we could be required to seek alternative financing sources.
As of September 30, 2026, the Company's indebtedness consisted of $825.0 million in principal amount of our 6.25% fixed-rate senior unsecured notes due October 2030 (the "2030 Notes"), $750.0 million in principal amount of our 6.50% fixed-rate senior unsecured notes due October 2033 (the "2033 Notes", and together with the 2030 Notes, the "Notes") and $245.0 million of outstanding borrowings under the 2025 Revolving Credit Facility. As of September 30, 2026, the Company had $539.7 million of liquidity comprised of the $505.0 million of available borrowing capacity under the 2025 Revolving Credit Facility, and $34.7 million of cash and cash equivalents.
Dividends and Distributions
|
(in thousands, except for per share amounts) |
Date of Record |
Dividends Paid to Class A Shareholders |
Distributions |
Rate Per |
||||||||||
|
2026: |
||||||||||||||
|
First Quarter |
March 5, 2026 |
$ |
2,163 |
$ |
4,010 |
$ |
0.05 |
|||||||
|
Second Quarter |
June 4, 2026 |
2,439 |
3,733 |
$ |
0.05 |
|||||||||
|
Third Quarter |
August 27, 2026 |
2,780 |
3,392 |
$ |
0.05 |
|||||||||
|
Total |
$ |
7,382 |
$ |
11,135 |
||||||||||
(1)
Excludes the Company.
On November 3, 2026, our board of directors declared a dividend on our Class A shares of $0.05 per share, payable on December 10, 2026, to shareholders of record as of November 25, 2026, and a corresponding required cash distribution to OpCo unitholders (other than the Company).
Contractual Obligations and Other Commitments
We are a party to contractual obligations involving commitments to make payments to third parties. These obligations impact our short-term and long-term liquidity and capital resource needs. Certain contractual obligations are reflected on the balance sheet as of September 30, 2026, while others are considered future commitments. Our contractual obligations primarily consist of non-cancelable purchase commitments with various parties to purchase goods or services entered into in the normal course of business and minimum royalty payments.
Cash Flows
The following table summarizes WaterBridge's cash flow for the nine months ended September 30, 2026 and 2025:
|
Nine Months Ended |
Amount of |
Percentage |
||||||||||||||
|
(in thousands) |
2026 |
2025 |
(Decrease) |
Change |
||||||||||||
|
Net cash provided by operating activities |
$ |
265,582 |
$ |
71,515 |
$ |
194,067 |
271 |
% |
||||||||
|
Net cash used in investing activities |
(611,612 |
) |
(129,529 |
) |
(482,083 |
) |
372 |
% |
||||||||
|
Net cash provided by financing activities |
329,156 |
391,379 |
(62,223 |
) |
(16 |
)% |
||||||||||
|
Net (decrease) increase in cash and cash equivalents |
$ |
(16,874 |
) |
$ |
333,365 |
$ |
(350,239 |
) |
(105 |
)% |
||||||
Net Cash Provided by Operating Activities. Net cash provided by operating activities increased $194.1 million. The increase was attributable to cash flow related to higher net income, net of adjustment items, of $171.9 million primarily related to increased volumes related to the WaterBridge Combination and organic commercial growth, including the completion of the Speedway Phase I project during the nine months ended September 30, 2026. Additionally, changes in working capital of $22.2 million primarily due to higher accrued interest due to timing of interest payments related to the Notes entered into in October 2025, partially offset by timing of collections.
Net Cash Used in Investing Activities. Net cash used in investing activities increased $482.1 million, primarily due to a $314.9 million increase in acquisition and acquisition-related expenditures, net of cash acquired, during the nine months ended September 30, 2026 driven by the NDB Landfill and Ranger acquisitions, and a $168.8 million increase in capital expenditures, inclusive of changes in associated working capital items, primarily related to construction of the Speedway Phase I project.
Net Cash Provided by Financing Activities. Net cash provided by financing activities decreased $62.2 million, to $329.2 million for the nine months ended September 30, 2026, consisting of $353.3 million debt borrowings, net of repayments and debt issuance costs, to fund the NDB Landfill and Ranger acquisitions and working capital needs associated with the Speedway Phase I project. This was partially offset by $18.7 million of dividends, dividend equivalents and distributions paid to shareholders, $2.9 million of required tax withholding related to the net settlement of Class A shares, $1.2 million of offering costs paid, and $0.9 million of repayments on finance leases.
Net cash provided by financing activities for the nine months ended September 30, 2025 consisted of $683.0 million of proceeds from the IPO, net of underwriting discounts and commissions and offering expenses, and contributions by member of $20.1 million prior to the IPO. This was partially offset by a $228.2 million purchase of OpCo equity interests and $82.7 million of debt repayments, net of borrowings and debt issuance costs.
Cash Flows
The following table summarizes WBEF's cash flow for the period January 1, 2025 through September 16, 2025:
|
(in thousands) |
For the Period January 1, 2025 through September 16, 2025 |
|||
|
Net cash provided by operating activities |
$ |
74,899 |
||
|
Net cash used in investing activities |
(73,291 |
) |
||
|
Net cash used in financing activities |
(9,789 |
) |
||
|
Net decrease in cash and cash equivalents |
$ |
(8,181 |
) |
|
Net Cash Provided by Operating Activities. Net cash provided by operating activities consisted of a net loss of $16.9 million, adjusted for non-cash items, primarily including $83.0 million of depreciation, amortization and accretion, $8.8 million of debt issuance costs, contractual customer relationship amortization and other non-cash items, partially offset by $15.4 million of share-based compensation. Operating cash flows were further impacted by an overall $15.4 million increase in working capital, consisting primarily of $21.9 million increase in accrued and other liabilities related to term loan interest, partially offset by a $6.5 million decrease in accounts receivable and accounts payable driven by timing of customer and supplier payments.
Net Cash Used in Investing Activities. Net cash used in investing activities consisted primarily of capital expenditures of $76.2 million related to expansion of our infrastructure network.
Net Cash Used in Financing Activities. Net cash used in financing activities consisted of $16.0 million of debt repayments related to the term loan, insurance financing and equipment financing notes, $13.3 million of distributions paid to Series A preferred unit holders, $3.0 million of contingent consideration payments and $2.4 million of offering costs paid, partially offset by $24.8 million of proceeds from debt, net of debt issuance costs.
Critical Accounting Estimates
The preparation of our Financial Statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the amounts reported in our Financial Statements and the accompanying notes. There have been no significant changes to our critical accounting estimates from those disclosed in our 2025 Form 10-K.
Recently Issued Accounting Pronouncements Not Yet Adopted
For a summary of recently issued accounting pronouncements, refer to Note 2 - Summary of Significant Accounting Policies within the notes to our unaudited condensed consolidated financial statements.
Off Balance Sheet Arrangements
We currently have no material off-balance sheet arrangements.
Waterbridge Infrastructure LLC published this content on November 05, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on November 05, 2026 at 11:06 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]