Secure Energy Services Q4 Earnings Call Highlights
Management emphasized capital returns and balance sheet strength. Gransch said the company returned CAD 373 million to shareholders in 2025 through dividends and share buybacks, including the repurchase of nearly 19 million shares at an average price below CAD 15, representing about 8% of shares outstanding.
Magus said the company ended 2025 with total debt to adjusted EBITDA of 2.1x, or 1.8x excluding leases. During the fourth quarter, SECURE refinanced part of its debt with CAD 300 million of senior unsecured notes due in 2032, which management said extended maturities and enhanced flexibility.
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Looking to 2026, Gransch said SECURE will increase its dividend by 5% to CAD 0.42 per share annualized, beginning with the second quarter of 2026, while also continuing to buy back shares opportunistically. The company also disclosed that since renewing its NCIB in December, it repurchased 1.1 million shares at a weighted average price of CAD 17.10.
Growth projects and 2026 capital plans
SECURE’s leadership said customer-driven demand led it to invest more heavily than initially planned in 2025. Gransch said the company deployed CAD 138 million of organic growth capital, above its original CAD 75 million plan, with investment directed mainly toward produced water infrastructure in the Montney, industrial waste processing, and optimization in metal recycling.
A key development highlighted on the call was the commissioning of the company’s first two “fully contracted” produced water disposal facilities in the Montney. Gransch said one came online in the fourth quarter, and the second is expected to be online in March, describing the facilities as long-cycle infrastructure supported by long-term agreements.
For 2026, management outlined capital allocation priorities that include CAD 75 million in organic growth projects, while noting that spending could increase as projects are sanctioned. Gransch said 2026 plans include incremental water disposal capacity at two existing Montney facilities and optimization projects across the network, as well as a pre-shredding investment at the Edmonton metal recycling facility intended to improve throughput and reduce downtime on the mega shredder. In Q&A, management said the 2026 growth capital mix is expected to be similar to last year and primarily weighted to the waste management business, with roughly CAD 10 million attributed to metals-related investments such as pre-shred equipment and railcar-related items.
Operational metrics and demand drivers
COO Corey Higham said SECURE delivered “consistent and reliable performance” across its 80-location network in 2025. He shared annual operational volumes across the waste management network, including approximately 95,000 barrels per day of produced water disposed, 38,000 barrels per day of liquid waste processed, roughly 1 million barrels of oil recovered from waste streams, and about 3.2 million tons of solid waste disposed.
In the energy infrastructure segment, Higham said the company handles more than 133,000 barrels per day of crude oil across 13 terminals and three gathering pipelines. He added that pipeline and terminal volumes increased modestly, supported by the Clearwater terminal expansion and the introduction of emulsion treating capabilities under long-term agreements.
Management also discussed how weaker oil prices affected exploration-linked service lines. Higham said produced water volumes remained stable, but waste processing, oil recovery, and landfill volumes declined year-over-year due to reduced exploration activity and lower discretionary spending by customers. Executives noted that about 20% of the business is tied to energy exploration, and that when WTI moves into the high-$50s to low-$60s, customers tend to slow discretionary work.
Metal recycling headwinds, pricing, accounting update, and 2026 outlook
Management said 2025 was challenging for metal recycling following the implementation of a 50% U.S. tariff on finished steel, which reduced Canadian domestic demand. Higham said the company repositioned more than 90% of scrap volumes into U.S. markets, requiring new customer relationships, additional rail capacity, and work to resolve inventory and transportation constraints. In Q&A, Gransch estimated the metals business saw an EBITDA impact of roughly 10% to 15% in 2025, and Higham said inventory levels are expected to normalize by around the midpoint of 2026 as logistics improve.
On pricing, executives said customer discussions were completed in the fourth quarter and that SECURE was “selective” by service line, with no near-term plans for additional pricing actions.
Magus also described a voluntary accounting policy change made in the fourth quarter related to the presentation of oil purchase and resale activities and certain commodity-related derivatives. Under the updated policy, realized and unrealized gains and losses from physically settled commodity contracts and related derivatives are presented on a net basis within revenue rather than as gross proceeds with offsetting costs. Magus said there is no impact to net income, adjusted EBITDA, cash flow, or the balance sheet, and prior periods were restated for comparability. He added that SECURE intends to pursue changes to its industry classification with S&P and MSCI to better reflect its positioning as a waste infrastructure business.
For 2026, SECURE provided adjusted EBITDA guidance of CAD 520 million to CAD 550 million. Management said the first quarter is expected to be broadly consistent with the fourth quarter of 2025, with incremental improvement anticipated later in the year from late-2025 and early-2026 project contributions and improving metal recycling performance as logistics normalize. In Q&A, executives said the guidance range reflects uncertainty largely tied to metals operations and field activity levels, and noted that the outlook does not include any tuck-in acquisitions.
Separately, management discussed its specialty chemicals business, saying activity levels in the third and fourth quarters were relatively similar and that performance in production chemistry related to paraffins and wax removal continued to do well. Magus also referenced ongoing disclosure related to a lawsuit with CES and said the Supreme Court concluded that SECURE owns the patent at issue, with the company disclosing a potential claim of CAD 100 million that would be determined by the courts in the future.
About Secure Energy Services (TSE:SES)
SECURE is a leading waste management and energy infrastructure business headquartered in Calgary, Alberta. The Corporation's extensive infrastructure network located throughout western Canada and North Dakota includes waste processing and transfer facilities, industrial landfills, metal recycling facilities, crude oil and water gathering pipelines, crude oil terminals and storage facilities. Through this infrastructure network, the Corporation carries out its principal business operations, including the collection, processing, recovery, recycling and disposal of waste streams generated by our energy and industrial customers and gathering, optimization, terminalling and storage of crude oil and natural gas liquids.
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