USA Compression Partners Reports Fourth-Quarter 2023 Results

Source: www.gulfoilandgas.com 2/13/2024, Location: North America

USA Compression Partners, LP announced its financial and operating results for fourth-quarter 2023.

Financial Highlights
• Record total revenues of $225.0 million for fourth-quarter 2023, compared to $190.1 million for fourth-quarter 2022.
• Net income was $12.8 million for fourth-quarter 2023, compared to $8.4 million for fourth-quarter 2022. Net income for fourth-quarter 2023 includes a $10.5 million loss on derivative instrument.
• Net cash provided by operating activities was $91.6 million for fourth-quarter 2023, compared to $82.1 million for fourth-quarter 2022.
• Adjusted EBITDA of $138.6 million for fourth-quarter 2023, compared to $113.0 million for fourth-quarter 2022.
• Distributable Cash Flow of $79.9 million for fourth-quarter 2023, compared to $60.6 million for fourth-quarter 2022.
• Distributable Cash Flow Coverage was 1.48x for fourth-quarter 2023, compared to 1.18x for fourth-quarter 2022.
• Paid cash distribution of $0.525 per common unit for fourth-quarter 2023, consistent with fourth-quarter 2022.

Operational Highlights
• Average horsepower utilization was 94.1% for fourth-quarter 2023, compared to 91.3% for fourth-quarter 2022.
• Record average revenue-generating horsepower of 3.41 million for fourth-quarter 2023, compared to 3.17 million for fourth-quarter 2022.
• Record average revenue per revenue-generating horsepower per month of $19.52 for fourth-quarter 2023, compared to $17.81 for fourth-quarter 2022.

“Our fourth-quarter results continued the trend of outstanding financial and operational results driven by high market demand for our exceptional level of compression services. Our fourth-quarter achievements consisted of consecutive-quarter record-setting revenues, Adjusted EBITDA, Distributable Cash Flow, and Distributable Cash Flow Coverage,” commented Eric D. Long, USA Compression’s President and Chief Executive Officer.

“These financial results were made possible by near-record utilization, exiting 2023 over 94%, achieving record per-horsepower average revenue of $19.52, record average revenue-generating horsepower of approximately 3.41 million, and at the same time maintaining consistent operating margins. As we turn to 2024, we believe the large-horsepower compression market will continue to be historically tight as crude oil and natural gas production is expected to grow in the key basins in which we operate, and capital discipline is expected to remain prevalent in the oil and gas industry. We look forward to continuing to deliver high-quality service to our customers, and remain focused on improving our financial condition and returning value to our stakeholders.”

Expansion capital expenditures were $90.1 million, maintenance capital expenditures were $6.6 million, and cash interest expense, net was $43.0 million for fourth-quarter 2023.

On January 11, 2024, the Partnership announced a fourth-quarter cash distribution of $0.525 per common unit, which corresponds to an annualized distribution rate of $2.10 per common unit. The distribution was paid on February 2, 2024, to common unitholders of record as of the close of business on January 22, 2024.

On January 12, 2024, the holders of the Partnership’s Series A Preferred Units (“Preferred Units”) elected to convert an aggregate of 40,000 Preferred Units into 1,998,850 common units, which were issued effective as of January 22, 2024.

Operational and Financial Data

Liquidity and Long-Term Debt
As of December 31, 2023, the Partnership was in compliance with all covenants under its $1.6 billion revolving credit facility. As of December 31, 2023, the Partnership had outstanding borrowings under the revolving credit facility of $871.8 million, $728.2 million of availability and, subject to compliance with the applicable financial covenants, available borrowing capacity of $529.1 million. As of December 31, 2023, the outstanding aggregate principal amount of the Partnership’s 6.875% senior notes due 2026 and 6.875% senior notes due 2027 was $725.0 million and $750.0 million, respectively.

Full-Year 2024 Outlook
USA Compression is providing its full-year 2024 guidance as follows:

• Net income range of $95.0 million to $115.0 million;
• A forward-looking estimate of net cash provided by operating activities is not provided because the items necessary to estimate net cash provided by operating activities, in particular the change in operating assets and liabilities, are not accessible or estimable at this time. The Partnership does not anticipate changes in operating assets and liabilities to be material, but changes in accounts receivable, accounts payable, accrued liabilities, and deferred revenue could be significant, such that the amount of net cash provided by operating activities would vary substantially from the amount of projected Adjusted EBITDA and Distributable Cash Flow;
• Adjusted EBITDA range of $555.0 million to $575.0 million; and
• Distributable Cash Flow range of $310.0 million to $330.0 million.


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