Business Context and Reporting Period
Company: WaterBridge Infrastructure LLC (NYSE: WBI)
Filing Type: Form 10-Q (Unaudited)
Reporting Period: Quarter and six months ended June 30, 2026
Business Overview: WaterBridge is a leading integrated, pure-play water infrastructure company operating primarily in the Delaware Basin. The company provides water management solutions, including gathering, transporting, recycling, and handling produced water for oil and natural gas exploration and production (E&P) companies. The company completed its initial public offering (IPO) and "WaterBridge Combination" in September 2025.
Key Financial Metrics
| Metric | Three Months Ended June 30, 2026 | Six Months Ended June 30, 2026 |
|---|---|---|
| Total Revenues | $217.8 million | $418.7 million |
| Net Income | $14.6 million | $24.1 million |
| Net Income Attributable to WBI | $5.1 million | $8.6 million |
| Operating Income | $40.3 million | $70.7 million |
| Adjusted EBITDA | $115.8 million | $218.7 million |
| Adjusted EBITDA Margin | 53% | 52% |
| Cash and Cash Equivalents | $47.6 million (as of June 30, 2026) | N/A |
| Total Debt (Principal) | $1.64 billion | N/A |
| Liquidity | $347.6 million (Cash + Revolver Availability) | N/A |
Material Changes vs. Prior Period
- Revenue Growth: Total revenues increased 128% year-over-year (Q2 2026 vs. Q2 2025) and 116% for the six-month period. This growth was driven by the WaterBridge Combination (acquiring NDB Operating), organic commercial growth, and increased volumes.
- Volume Increases: Total produced water handling volumes rose 114% to 2,598 MBbl/d in Q2 2026. Water solutions volumes increased 71% to 361 MBbl/d.
- Profitability: Net income increased 104% for the quarter and 172% for the six-month period. Adjusted EBITDA increased 185% for the quarter.
- Acquisition Activity: On June 22, 2026, the company acquired Ranger Water Midstream LLC for approximately $82.9 million, adding produced water gathering, disposal, and brackish water supply assets in New Mexico.
- Capital Expenditures: Capital expenditures increased significantly to $234.2 million for the six months ended June 30, 2026, compared to $130.0 million in the prior year period, primarily due to the Speedway Phase I Pipeline project.
Guidance, Outlook, and Risks
Outlook and Management Commentary: Management views the outlook for energy and infrastructure development in the Permian Basin as positive, supported by favorable well economics and potential regulatory support for domestic energy production. The company expects continued growth in produced water handling capacity requirements. In July 2026, the company commenced accepting volumes into the Speedway Phase I Pipeline project.
Recent Developments (Subsequent Events):
- Debt Facility Amendment: On August 4, 2026, the company increased its Revolving Credit Facility commitments from $500 million to $750 million and reduced applicable interest margins by 0.25%.
- New Acquisition: On August 4, 2026, the company entered an agreement to acquire an environmental waste management facility in New Mexico for a net consideration of approximately $169 million, expected to close in Q3 2026.
Risks and Contingencies:
- Geopolitical Volatility: The ongoing war between the U.S. and Iran has driven commodity price and inflation volatility, which could impact E&P operators' drilling decisions.
- Regulatory/Legal: The company is facing an enforcement action from the Railroad Commission of Texas (RRC) seeking approximately $6.9 million for the plugging of an orphan well. The company believes the action is without merit and has not accrued a liability.
- Customer Concentration: The company relies on a limited number of customers and a specific region (Delaware Basin) for the majority of its revenues.
Investor Verification Checklist
- Debt Covenants: Verify compliance with the 2025 Revolving Credit Facility covenants, specifically the consolidated net leverage ratio (max 5.00:1.00) and interest coverage ratio (min 2.50:1.00).
- Acquisition Integration: Monitor the integration and performance of the Ranger Water Midstream acquisition and the pending $169 million waste management facility acquisition.
- Regulatory Resolution: Track the status of the RRC enforcement action regarding the $6.9 million orphan well plugging expense.
- Capital Allocation: Review the funding strategy for the Speedway Phase I project and future capital expenditures against operating cash flows and revolver availability.
- Dividend Sustainability: Assess the ability to maintain the $0.05 per share quarterly dividend given the high capital expenditure program and debt service requirements.