WaterBridge Infrastructure LLC Q1 FY2026 earnings call

CEO Jason Long mentioned strong operational momentum in the first quarter, raised 2026 guidance, and speedway Phase 1 and Kraken Project are progressing smoothly. COO Michael Chopp-Wrights introduced the progress of Speedway Phase 1 construction and the strong demand in Phase 2 open season, and the synergistic relationship with LandBridge supports the infrastructure strategy. CFO Scott McNeely introduced raising 2026 full-year guidance, first-quarter financial results, capital expenditure, balance sheet, and declared dividends.

First quarter produced water handling volumes came in at approximately 2.5 million barrels per day. First quarter revenue was $201 million, adjusted EBITDA was $102.9 million with an adjusted EBITDA margin of 51%. Gross margin per barrel improved from 18 cents per barrel in Q4 to 20 cents per barrel in Q1. Speedway Phase 1 is on track for a mid-year in-service date. The Kraken Project NBC increase is expected mid-year. The Speedway Phase 2 open season wrapped up in April with strong results, representing up to 500,000 barrels per day of incremental capacity.

Waterbridge is increasing its full-year volume guidance to 2.525 to 2.725 million barrels a day and adjusted EBITDA guidance to 425 million to 465 million. Capital expenditure guidance of 430 million to 490 million is unchanged. This raise reflects strengthened commercial and operational demand outlook and a more supportive macroeconomic environment.

Risks include macroeconomic uncertainties, cost fluctuations such as steel and resin price increases, and project progress not meeting expectations.

Q: Derek Whitfield asked about the split between new and existing clients in Speedway Phase 2 and further capacity additions.

A: Mix of current and new customers, with recognition of need for long-haul disposal.

Q: John McKay inquired about conservatism in guidance and returns of Speedway Phase 2.

A: Guidance move based on produced water expectations, conservative on commodity price incorporation.

Q: Kevin asked about impact of margins from Speedway 1 and 2 and long-term outlook for deeper zones.

A: Expect margin expansion, deeper zones evaluated by producers.

Q: Eli Josen asked about customer demand for MVCs in Speedway Phase 1 and beneficial reuse.

A: Demand for MVCs, beneficial reuse in discussion stage.

Q: Praneeth Satish asked about opportunities in Speedway Phase 1 and long-term outlook for deeper zones.

A: Unutilized capacity in Speedway Phase 1, deeper zones evolving.

Q: Don Crist asked about inflation on Speedway construction and hedging.

A: Speedway Phase 1 insulated from cost increases, strategic purchasing for Phase 2