Aris Water Solutions, Inc.

Greetings and welcome to the ARIS Water Solutions second quarter 2022 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, David Turf, Senior Vice President, Finance and Investor Relations.

Good morning and welcome to the ARIS Water Solutions second 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, Brenda Schroer. 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 the other cautionary statements included in our most recent quarterly report on Form 10-Q and annual report on Form 10-K filed with the Securities and Exchange Commissions. I would also like to point out that our investor presentation and 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 U.S. GAAP. Reconciliations to the most directly comparable GAAP measures are included in our earnings release and the appendix of today's accompanying presentation. I'll now turn the call over to our founder and executive chairman, Bill Zartler.

Thank you, David, and thanks to everyone for joining us this morning. In the second quarter, we continued our momentum and growth in a supportive commodity price environment, but were impacted by headwinds and supply chain constraints leading to higher than anticipated costs, inflation, and unexpected delays from our contracted customers late in the quarter. With the newer completion design of multi-well long lateral pads and large water supply needs, delays can have a significant impact on us across the end of the quarter. As a result, our adjusted EBITDA for the second quarter fell slightly below our expected range of $38 to $40 million. Our long-term contracts demonstrated reliability and leading recycling capabilities, however, continue to drive our growth alongside our premier customer base. As delayed wells are completed, we expect to both deliver recycled water for those wells and receive the associated produced water volumes back. Similarly, our CPI-linked revenue inflation causes in our contracts are triggered at discrete, generally annual times, thus resulting in short-term mismatches. Fundamentally, we continue to grow substantially year over year and are confident in this continued growth. Yesterday, we also announced the acquisition of the Delaware Energy Services assets in exchange for equity consideration and a small volumetric-based earn-out. I'll let Amanda expand on the strategic benefits of the transaction, but we're pleased to add Delaware Energy's complimentary assets and customers to our core system in Eddy and Lee counties. With that, I'll turn it over to Amanda.